State of Illinois
92nd General Assembly
Legislation

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92_SB2049eng

 
SB2049 Engrossed                               LRB9216008DJgc

 1        AN ACT concerning partnerships.

 2        Be it  enacted  by  the  People  of  the  State  of  Illinois,
 3    represented in the General Assembly:


 4                              ARTICLE 1
 5                         GENERAL PROVISIONS

 6        Section  100.  Short title.  This Act may be cited as the
 7    Uniform Partnership Act (1997).

 8        Section 101. Definitions. In this Act:
 9        (a)  "Business" includes  every  trade,  occupation,  and
10    profession.
11        (b)  "Debtor  in  bankruptcy"  means  a person who is the
12    subject of:
13             (1)  an order for  relief  under  Title  11  of  the
14        United   States  Code  or  a  comparable  order  under  a
15        successor statute of general application; or
16             (2)  a comparable order  under  federal,  state,  or
17        foreign law governing insolvency.
18        (c)  "Distribution"  means  a  transfer of money or other
19    property from a partnership to a  partner  in  the  partner's
20    capacity as a partner or to the partner's transferee.
21        (d)  "Foreign  limited  liability  partnership"  means  a
22    partnership that:
23             (1)  is  formed  under  laws  other than the laws of
24        this State; and
25             (2)  has  the  status   of   a   limited   liability
26        partnership under those laws.
27        (e)  "Limited  liability partnership" means a partnership
28    that has filed a statement  of  qualification  under  Section
29    1001  and  does not have a similar statement in effect in any
 
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 1    other jurisdiction.
 2        (f)  "Partnership" means an  association  of  2  or  more
 3    persons to carry on as co-owners a business for profit formed
 4    under Section 202 of this Act, predecessor law, or comparable
 5    law of another jurisdiction.
 6        (g)  "Partnership agreement" means the agreement, whether
 7    written,  oral, or implied, among the partners concerning the
 8    partnership,  including   amendments   to   the   partnership
 9    agreement.
10        (h)  "Partnership  at  will" means a partnership in which
11    the partners have not agreed to  remain  partners  until  the
12    expiration  of  a  definite  term  or  the  completion  of  a
13    particular undertaking.
14        (i)  "Partnership interest" or "partner's interest in the
15    partnership"  means  all  of  a  partner's  interests  in the
16    partnership, including the  partner's  transferable  interest
17    and all management and other rights.
18        (j)  "Person"  means an individual, corporation, business
19    trust,  estate,  trust,   partnership,   association,   joint
20    venture,  government,  governmental  subdivision,  agency, or
21    instrumentality, or any other legal or commercial entity.
22        (k)  "Property" means all property,  real,  personal,  or
23    mixed, tangible or intangible, or any interest therein.
24        (l)  "State"  means  a  state  of  the United States, the
25    District of Columbia, the Commonwealth of Puerto Rico, or any
26    territory or insular possession subject to  the  jurisdiction
27    of the United States.
28        (m)  "Statement"   means   a   statement  of  partnership
29    authority under Section 303  of  this  Act,  a  statement  of
30    denial  under  Section 304, a statement of dissociation under
31    Section 704, a statement of dissolution under Section 805,  a
32    statement  of merger under Section 907 or 908, a statement of
33    qualification under Section 1001, a statement  of  withdrawal
34    under   Section   1001   or  1102,  a  statement  of  foreign
 
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 1    qualification  under  Section  1102,  or  an   amendment   or
 2    cancellation of any of the foregoing.
 3        (n)  "Transfer"   includes   an  assignment,  conveyance,
 4    lease, mortgage, deed, and encumbrance.

 5        Section 102. Knowledge and notice.
 6        (a)  A person knows a  fact  if  the  person  has  actual
 7    knowledge of it.
 8        (b)  A person has notice of a fact if the person:
 9             (1)  knows of it;
10             (2)  has received a notification of it; or
11             (3)  has  reason  to  know it exists from all of the
12        facts known to the person at the time in question.
13        (c)  A person notifies or gives a notification to another
14    by taking steps  reasonably  required  to  inform  the  other
15    person  in  ordinary  course, whether or not the other person
16    learns of it.
17        (d)  A  person   receives   a   notification   when   the
18    notification:
19             (1)  comes to the person's attention; or
20             (2)  is  duly  delivered  at  the  person's place of
21        business or at any other place held out by the person  as
22        a place for receiving communications.
23        (e)  Except  as  otherwise  provided in subsection (f), a
24    person  other  than  an  individual  knows,  has  notice,  or
25    receives  a  notification  of  a  fact  for  purposes  of   a
26    particular  transaction  when  the  individual conducting the
27    transaction knows, has notice, or receives a notification  of
28    the  fact,  or  in  any  event  when the fact would have been
29    brought to the  individual's  attention  if  the  person  had
30    exercised   reasonable   diligence.   The   person  exercises
31    reasonable diligence if it maintains reasonable routines  for
32    communicating   significant  information  to  the  individual
33    conducting the transaction and there is reasonable compliance
 
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 1    with the routines. Reasonable diligence does not  require  an
 2    individual  acting  for the person to communicate information
 3    unless the communication is part of the individual's  regular
 4    duties   or   the  individual  has  reason  to  know  of  the
 5    transaction and that  the  transaction  would  be  materially
 6    affected by the information.
 7        (f)  A  partner's  knowledge,  notice,  or  receipt  of a
 8    notification  of  a  fact  relating  to  the  partnership  is
 9    effective immediately as knowledge by, notice to, or  receipt
10    of a notification by the partnership, except in the case of a
11    fraud  on the partnership committed by or with the consent of
12    that partner.

13        Section   103.   Effect   of    partnership    agreement;
14    nonwaivable provisions.
15        (a)  Except  as  otherwise  provided  in  subsection (b),
16    relations among the partners and between the partners and the
17    partnership are governed by the partnership agreement. To the
18    extent the partnership agreement does not otherwise  provide,
19    this Act governs relations among the partners and between the
20    partners and the partnership.
21        (b)  The partnership agreement may not:
22             (1)  vary  the  rights  and duties under Section 105
23        except  to  eliminate  the  duty  to  provide  copies  of
24        statements to all of the partners;
25             (2)  unreasonably restrict the right  of  access  to
26        books and records under Section 403(b);
27             (3)  eliminate   or  reduce  a  partner's  fiduciary
28        duties, but may:
29                  (i)  identify specific types or  categories  of
30             activities  that do not violate these duties, if not
31             manifestly unreasonable; and
32                  (ii)  specify  the  number  or  percentage   of
33             partners  that  may  authorize or ratify, after full
 
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 1             disclosure of all material facts, a specific act  or
 2             transaction   that  otherwise  would  violate  these
 3             duties;
 4             (4)  eliminate or  reduce  the  obligation  of  good
 5        faith  and  fair  dealing  under  Section 404(d), but the
 6        partnership agreement  may  prescribe  the  standards  by
 7        which   the  performance  of  the  obligation  is  to  be
 8        measured,   if   the   standards   are   not   manifestly
 9        unreasonable;
10             (5)  vary the power to dissociate as a partner under
11        Section  602(a),  except  to  require  the  notice  under
12        Section 601(1) to be in writing;
13             (6)  vary the right of a court to expel a partner in
14        the events specified in Section 601(5);
15             (7)  vary the requirement to wind up the partnership
16        business in cases specified in Section  801(4),  (5),  or
17        (6);
18             (8)  vary  the law applicable to a limited liability
19        partnership under Section 106(b); or
20             (9)  restrict the rights of a person, other  than  a
21        partner   and  transferee  of  a  partner's  transferable
22        interest under this Act.

23        Section 104. Supplemental principles of law.
24        (a)  Unless displaced by particular  provisions  of  this
25    Act, the principles of law and equity supplement this Act.
26        (b)  If  an  obligation to pay interest arises under this
27    Act and the rate is not specified, the rate is that specified
28    in Section 4 of the Interest Act.

29        Section  105.  Execution,  filing,   and   recording   of
30    statements.
31        (a)  A  statement  may  be  filed  in  the  office of the
32    Secretary of State. A certified copy of a statement  that  is
 
SB2049 Engrossed            -6-                LRB9216008DJgc
 1    filed  in  an  office  in  another  State may be filed in the
 2    office of the Secretary  of  State.  Either  filing  has  the
 3    effect  provided  in  this  Act  with  respect to partnership
 4    property located in or transactions that occur in this State.
 5        (b)  A certified copy of a statement that has been  filed
 6    in  the  office of the Secretary of State and recorded in the
 7    office for recording  transfers  of  real  property  has  the
 8    effect  provided  for  recorded  statements  in  this  Act. A
 9    recorded  statement  that  is  not  a  certified  copy  of  a
10    statement filed in the office of the Secretary of State  does
11    not  have the effect provided for recorded statements in this
12    Act.
13        (c)  A statement filed by a partnership must be  executed
14    by  at least 2 partners. Other statements must be executed by
15    a  partner  or  other  person  authorized  by  this  Act.  An
16    individual who executes a statement as, or on  behalf  of,  a
17    partner  or  other  person  named as a partner in a statement
18    shall personally declare under penalty of  perjury  that  the
19    contents of the statement are accurate.
20        (d)  A  person authorized by this Act to file a statement
21    may amend or cancel the statement by filing an  amendment  or
22    cancellation  that  names  the  partnership,  identifies  the
23    statement,  and  states  the  substance  of  the amendment or
24    cancellation.
25        (e)  A person who files  a  statement  pursuant  to  this
26    Section  shall promptly send a copy of the statement to every
27    nonfiling partner and to any other person named as a  partner
28    in the statement.  Failure to send a copy of a statement to a
29    partner  or  other person does not limit the effectiveness of
30    the statement as to a person not a partner.
31        (f)  The Secretary of State may collect a fee for  filing
32    or  providing  a certified copy of a statement as provided in
33    Section 108. The officer responsible for recording  transfers
34    of real property may collect a fee for recording a statement.
 
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 1        Section 106. Governing law.
 2        (a)  Except  as otherwise provided in subsection (b), the
 3    law of the jurisdiction in which a partnership has its  chief
 4    executive  office  governs  relations  among the partners and
 5    between the partners and the partnership.
 6        (b)  The law of this State governs  relations  among  the
 7    partners and between the partners and the partnership and the
 8    liability   of  partners  for  an  obligation  of  a  limited
 9    liability partnership.

10        Section 107. Partnership subject to amendment  or  repeal
11    of Act.  A partnership governed by this Act is subject to any
12    amendment to or repeal of this Act.

13        Section 108. Fees.
14        (a)  The  Secretary  of State shall charge and collect in
15    accordance  with  the  provisions  of  this  Act  and   rules
16    promulgated under its authority:
17             (1)  fees for filing documents;
18             (2)  miscellaneous charges; and
19             (3)  fees  for  the sale of lists of filings, copies
20        of  any  documents,  and  the  sale  or  release  of  any
21        information.
22        (b)  The Secretary of State shall charge and collect:
23             (1)  for furnishing a copy or certified copy of  any
24        document,  instrument,  or paper relating to a registered
25        limited liability partnership, $1 per page, but not  less
26        than  $25,  and  $25 for the certificate and for affixing
27        the seal to the certificate;
28             (2)  for the transfer  of  information  by  computer
29        process media to any purchaser, fees established by rule;
30             (3)  for   filing   a   statement   of   partnership
31        authority, $25;
32             (4)  for filing a statement of denial, $25;
 
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 1             (5)  for filing a statement of dissociation, $25;
 2             (6)  for filing a statement of dissolution, $100;
 3             (7)  for filing a statement of merger, $100;
 4             (8)  for  filing  a statement of qualification for a
 5        limited liability partnership organized under the laws of
 6        this State, $100 for each partner, but in no event  shall
 7        the fee be less than $200 or exceed $5,000;
 8             (9)  for    filing    a    statement    of   foreign
 9        qualification, $500;
10             (10)  for filing a renewal statement for  a  limited
11        liability  partnership  organized  under the laws of this
12        State, $100 for each partner, but in no event  shall  the
13        fee be less than $200 or exceed $5,000;
14             (11)  for  filing  a renewal statement for a foreign
15        limited liability partnership, $300.
16             (12)  for filing an amendment or cancellation  of  a
17        statement, $25;
18             (13)  for filing a statement of withdrawal, $100;
19             (14)  for  the  purposes  of changing the registered
20        agent name or registered office, or both, $25.
21        (c)  All fees collected pursuant to  this  Act  shall  be
22    deposited into the Division of Corporations Limited Liability
23    Partnership Fund.
24        (d)  There  is  hereby  continued in the State treasury a
25    special fund to be known  as  the  Division  of  Corporations
26    Limited Liability Partnership Fund. Moneys deposited into the
27    Fund shall, subject to appropriation, be used by the Business
28    Services  Division of the Office of the Secretary of State to
29    administer the responsibilities of the Secretary  of    State
30    under  this  Act.  The  balance of the Fund at the end of any
31    fiscal year shall not exceed  $200,000,  and  any  amount  in
32    excess  thereof  shall  be transferred to the General Revenue
33    Fund.
 
SB2049 Engrossed            -9-                LRB9216008DJgc
 1        Section 109. Illinois Administrative Procedure  Act.  The
 2    Illinois  Administrative  Procedure  Act is expressly adopted
 3    and incorporated in Articles 10 and 11 of this Act as if  all
 4    of  the  provisions  of the Illinois Administrative Procedure
 5    Act were included in Articles 10 and 11 of this  Act,  except
 6    that the provisions of subsection (c) of Section 10-65 of the
 7    Illinois Administrative Procedure Act, which provides that at
 8    a  hearing the licensee has the right to show compliance with
 9    all  lawful  requirements  for  retention,  continuation,  or
10    renewal of the license, is specifically excluded, and for the
11    purposes of this Act, the notice required under Section 10-25
12    of the Illinois  Administrative    Procedure  Act  is  deemed
13    sufficient when mailed to the last known address of a party.

14                              ARTICLE 2
15                        NATURE OF PARTNERSHIP

16        Section 201. Partnership as entity.
17        (a)  A   partnership  is  an  entity  distinct  from  its
18    partners.
19        (b)  A limited liability partnership continues to be  the
20    same  entity that existed before the filing of a statement of
21    qualification under Section 1001 of this Act.

22        Section 202. Formation of partnership.
23        (a)  Except as otherwise provided in subsection (b),  the
24    association  of  2 or more persons to carry on as co-owners a
25    business for profit forms a partnership, whether or  not  the
26    persons intend to form a partnership.
27        (b)  An  association  formed  under  a statute other than
28    this Act, a predecessor statute, or a comparable  statute  of
29    another jurisdiction is not a partnership under this Act.
30        (c)  In  determining whether a partnership is formed, the
31    following rules apply:
 
SB2049 Engrossed            -10-               LRB9216008DJgc
 1             (1)  Joint tenancy, tenancy in  common,  tenancy  by
 2        the  entireties, joint property, common property, or part
 3        ownership does not by  itself  establish  a  partnership,
 4        even  if  the  co-owners share profits made by the use of
 5        the property.
 6             (2)  The sharing of gross returns does not by itself
 7        establish a partnership, even if the persons sharing them
 8        have a joint or common right or interest in property from
 9        which the returns are derived.
10             (3)  A person who receives a share of the profits of
11        a business is presumed to be a partner in  the  business,
12        unless the profits were received in payment:
13                  (i)  of a debt by installments or otherwise;
14                  (ii)  for services as an independent contractor
15             or of wages or other compensation to an employee;
16                  (iii)  of rent;
17                  (iv)  of  an  annuity  or  other  retirement or
18             health benefit to a beneficiary, representative,  or
19             designee of a deceased or retired partner;
20                  (v)  of  interest  or  other  charge on a loan,
21             even if  the  amount  of  payment  varies  with  the
22             profits  of  the  business,  including  a  direct or
23             indirect  present  or  future   ownership   of   the
24             collateral,   or  rights  to  income,  proceeds,  or
25             increase in value derived from the collateral; or
26                  (vi)  for  the  sale  of  the  goodwill  of   a
27             business   or  other  property  by  installments  or
28             otherwise.

29        Section 203. Partnership property. Property acquired by a
30    partnership is property of the partnership  and  not  of  the
31    partners individually.

32        Section 204. When property is partnership property.
 
SB2049 Engrossed            -11-               LRB9216008DJgc
 1        (a)  Property  is partnership property if acquired in the
 2    name of:
 3             (1)  the partnership; or
 4             (2)  one or more partners with an indication in  the
 5        instrument  transferring  title  to  the  property of the
 6        person's capacity as a partner or of the existence  of  a
 7        partnership  but without an indication of the name of the
 8        partnership.
 9        (b)  Property is acquired in the name of the  partnership
10    by a transfer to:
11             (1)  the partnership in its name; or
12             (2)  one  or  more  partners  in  their  capacity as
13        partners  in  the  partnership,  if  the  name   of   the
14        partnership  is  indicated in the instrument transferring
15        title to the property.
16        (c)  Property is presumed to be partnership  property  if
17    purchased  with  partnership  assets, even if not acquired in
18    the name of the partnership or of one or more  partners  with
19    an  indication  in  the  instrument transferring title to the
20    property of the person's capacity as  a  partner  or  of  the
21    existence of a partnership.
22        (d)  Property  acquired in the name of one or more of the
23    partners,   without   an   indication   in   the   instrument
24    transferring title to the property of the  person's  capacity
25    as a partner or of the existence of a partnership and without
26    use  of  partnership  assets,  is  presumed  to  be  separate
27    property, even if used for partnership purposes.

28                              ARTICLE 3
29                      RELATIONS OF PARTNERS TO
30                  PERSONS DEALING WITH PARTNERSHIP

31        Section 301. Partner agent of partnership. Subject to the
32    effect  of a statement of partnership authority under Section
 
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 1    303 of this Act:
 2             (1)  Each partner is an agent of the partnership for
 3        the purpose  of  its  business.  An  act  of  a  partner,
 4        including   the   execution   of  an  instrument  in  the
 5        partnership name,  for  apparently  carrying  on  in  the
 6        ordinary  course  the partnership business or business of
 7        the  kind  carried  on  by  the  partnership  binds   the
 8        partnership,  unless  the partner had no authority to act
 9        for the partnership in  the  particular  matter  and  the
10        person  with  whom  the  partner  was dealing knew or had
11        received  a  notification   that   the   partner   lacked
12        authority.
13             (2)  An act of a partner which is not apparently for
14        carrying  on  in  the  ordinary  course  the  partnership
15        business  or  business  of  the  kind  carried  on by the
16        partnership binds the partnership only  if  the  act  was
17        authorized by the other partners.

18        Section 302. Transfer of partnership property.
19        (a)  Partnership property may be transferred as follows:
20             (1)  Subject   to  the  effect  of  a  statement  of
21        partnership authority under  Section  303  of  this  Act,
22        partnership  property held in the name of the partnership
23        may be transferred by an instrument of transfer  executed
24        by a partner in the partnership name.
25             (2)  Partnership property held in the name of one or
26        more  partners  with  an  indication  in  the  instrument
27        transferring  the  property  to them of their capacity as
28        partners or  of  the  existence  of  a  partnership,  but
29        without an indication of the name of the partnership, may
30        be  transferred  by an instrument of transfer executed by
31        the persons in whose name the property is held.
32             (3)  Partnership property held in the name of one or
33        more persons  other  than  the  partnership,  without  an
 
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 1        indication in the instrument transferring the property to
 2        them of their capacity as partners or of the existence of
 3        a  partnership,  may  be  transferred by an instrument of
 4        transfer executed  by  the  persons  in  whose  name  the
 5        property is held.
 6        (b)  A  partnership may recover partnership property from
 7    a  transferee  only  if  it  proves  that  execution  of  the
 8    instrument of initial transfer did not bind  the  partnership
 9    under Section 301 and:
10             (1)  as  to  a  subsequent transferee who gave value
11        for property transferred under subsection (a)(1) and  (2)
12        of  this  Section,  proves that the subsequent transferee
13        knew or had received a notification that the  person  who
14        executed   the  instrument  of  initial  transfer  lacked
15        authority to bind the partnership; or
16             (2)  as to a transferee who gave value for  property
17        transferred  under  subsection  (a)(3),  proves  that the
18        transferee knew or had received a notification  that  the
19        property was partnership property and that the person who
20        executed   the  instrument  of  initial  transfer  lacked
21        authority to bind the partnership.
22        (c)  A partnership may not recover  partnership  property
23    from  a  subsequent  transferee  if the partnership would not
24    have been entitled to recover the property, under  subsection
25    (b), from any earlier transferee of the property.
26        (d)  If  a person holds all of the partners' interests in
27    the partnership, all of the  partnership  property  vests  in
28    that person. The person may execute a document in the name of
29    the  partnership  to evidence vesting of the property in that
30    person and may file or record the document.

31        Section 303. Statement of partnership authority.
32        (a)  A partnership may file a  statement  of  partnership
33    authority, which:
 
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 1             (1)  must include:
 2                  (i)  the name of the partnership;
 3                  (ii)  the street address of its chief executive
 4             office  and of one office in this State, if there is
 5             one;
 6                  (iii)  the names and mailing addresses  of  all
 7             of  the  partners  or  of  an  agent  appointed  and
 8             maintained  by  the  partnership  for the purpose of
 9             subsection (b); and
10                  (iv)  the names of the partners  authorized  to
11             execute  an  instrument  transferring  real property
12             held in the name of the partnership; and
13             (2)  may state the authority, or limitations on  the
14        authority,  of  some or all of the partners to enter into
15        other transactions on behalf of the partnership  and  any
16        other matter.
17        (b)  If  a  statement  of  partnership authority names an
18    agent, the agent shall maintain  a  list  of  the  names  and
19    mailing  addresses  of  all  of  the  partners  and  make  it
20    available to any person on request for good cause shown.
21        (c)  If  a  filed  statement  of partnership authority is
22    executed pursuant to Section 105(c) and states  the  name  of
23    the  partnership  but  does  not  contain  all  of  the other
24    information required by subsection (a) of this  Section,  the
25    statement  nevertheless operates with respect to a person not
26    a partner as provided in subsections (d) and (e).
27        (d)  Except as otherwise provided in  subsection  (g)  of
28    this  Section,  a  filed  statement  of partnership authority
29    supplements  the  authority  of  a  partner  to  enter   into
30    transactions on behalf of the partnership as follows:
31             (1)  Except  for transfers of real property, a grant
32        of  authority  contained  in   a   filed   statement   of
33        partnership  authority is conclusive in favor of a person
34        who gives value without knowledge  to  the  contrary,  so
 
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 1        long  as  and  to  the  extent  that a limitation on that
 2        authority  is  not  then  contained  in   another   filed
 3        statement.  A  filed  cancellation  of  a  limitation  on
 4        authority revives the previous grant of authority.
 5             (2)  A  grant of authority to transfer real property
 6        held in the  name  of  the  partnership  contained  in  a
 7        certified  copy  of  a  filed  statement  of  partnership
 8        authority  recorded in the office for recording transfers
 9        of that real property is conclusive in favor of a  person
10        who  gives  value  without  knowledge to the contrary, so
11        long as and to the extent that  a  certified  copy  of  a
12        filed statement containing a limitation on that authority
13        is  not  then  of  record  in  the  office  for recording
14        transfers of that real property.  The  recording  in  the
15        office for recording transfers of that real property of a
16        certified copy of a filed cancellation of a limitation on
17        authority revives the previous grant of authority.
18        (e)  A  person  not  a  partner  is  deemed  to know of a
19    limitation on the authority of a  partner  to  transfer  real
20    property  held  in the name of the partnership if a certified
21    copy of the filed  statement  containing  the  limitation  on
22    authority  is of record in the office for recording transfers
23    of that real property.
24        (f)  Except as otherwise provided in subsections (d)  and
25    (e)  of  this Section and Sections 704 and 805 of this Act, a
26    person not a partner is not deemed to know of a limitation on
27    the authority of a partner merely because the  limitation  is
28    contained in a filed statement.
29        (g)  Unless   earlier  canceled,  a  filed  statement  of
30    partnership authority is canceled by operation of law 5 years
31    after the date on which the statement,  or  the  most  recent
32    amendment, was filed with the Secretary of State.

33        Section  304.  Statement  of  denial.  A partner or other
 
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 1    person named as a partner in a filed statement of partnership
 2    authority or in a list maintained by  an  agent  pursuant  to
 3    Section  303(b)  may  file  a statement of denial stating the
 4    name of the partnership and the fact that  is  being  denied,
 5    which may include denial of a person's authority or status as
 6    a partner. A statement of denial is a limitation on authority
 7    as provided in Section 303(d) and (e).

 8        Section  305. Partnership liable for partner's actionable
 9    conduct.
10        (a)  A partnership is liable for loss or injury caused to
11    a person, or for  a  penalty  incurred,  as  a  result  of  a
12    wrongful  act  or omission, or other actionable conduct, of a
13    partner acting in the ordinary  course  of  business  of  the
14    partnership or with authority of the partnership.
15        (b)  If,  in  the course of the partnership's business or
16    while acting with authority of  the  partnership,  a  partner
17    receives  or  causes  the  partnership  to  receive  money or
18    property of a person not a partner, and the money or property
19    is misapplied by a partner, the partnership is liable for the
20    loss.

21        Section 306. Partner's liability.
22        (a)  Except as otherwise provided in subsections (b)  and
23    (c)  of  this  Section,  all  partners are liable jointly and
24    severally for  all  obligations  of  the  partnership  unless
25    otherwise agreed by the claimant or provided by law.
26        (b)  A  person  admitted  as  a  partner into an existing
27    partnership is not  personally  liable  for  any  partnership
28    obligation  incurred  before  the  person's  admission  as  a
29    partner.
30        (c)  An  obligation  of  a partnership incurred while the
31    partnership  is  a  limited  liability  partnership,  whether
32    arising in  contract,  tort,  or  otherwise,  is  solely  the
 
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 1    obligation  of  the  partnership. A partner is not personally
 2    liable, directly or indirectly, by  way  of  contribution  or
 3    otherwise,  for  such an obligation solely by reason of being
 4    or  so  acting  as  a  partner.   This   subsection   applies
 5    notwithstanding  anything  inconsistent  in  the  partnership
 6    agreement  that  existed immediately before the vote required
 7    to become  a  limited  liability  partnership  under  Section
 8    1001(b) of this Act.

 9        Section  307.  Actions  by  and  against  partnership and
10    partners.
11        (a)  A partnership may sue and be sued in the name of the
12    partnership.
13        (b)  An action may be  brought  against  the  partnership
14    and,  to the extent not inconsistent with Section 306 of this
15    Act, any or all of the partners in  the  same  action  or  in
16    separate actions.
17        (c)  A  judgment against a partnership is not by itself a
18    judgment against a partner. A judgment against a  partnership
19    may  not be satisfied from a partner's assets unless there is
20    also a judgment against the partner.
21        (d)  A judgment  creditor  of  a  partner  may  not  levy
22    execution  against  the  assets  of  the partner to satisfy a
23    judgment based on a claim against the partnership unless  the
24    partner  is personally liable for the claim under Section 306
25    and:
26             (1)  a judgment based on the  same  claim  has  been
27        obtained  against the partnership and a writ of execution
28        on the judgment has been returned unsatisfied in whole or
29        in part;
30             (2)  the partnership is a debtor in bankruptcy;
31             (3)  the partner has agreed that the  creditor  need
32        not exhaust partnership assets;
33             (4)  a  court  grants  permission  to  the  judgment
 
SB2049 Engrossed            -18-               LRB9216008DJgc
 1        creditor  to  levy  execution  against  the  assets  of a
 2        partner  based  on  a  finding  that  partnership  assets
 3        subject to execution are clearly insufficient to  satisfy
 4        the  judgment,  that  exhaustion of partnership assets is
 5        excessively burdensome, or that the grant  of  permission
 6        is  an  appropriate  exercise  of  the  court's equitable
 7        powers; or
 8             (5)  liability is imposed on the partner by  law  or
 9        contract independent of the existence of the partnership.
10        (e)  This Section applies to any partnership liability or
11    obligation  resulting  from  a representation by a partner or
12    purported partner under Section 308 of this Act.

13        Section 308. Liability of purported partner.
14        (a)  If a person, by words or conduct, purports to  be  a
15    partner,  or  consents  to  being represented by another as a
16    partner, in a partnership or with one  or  more  persons  not
17    partners, the purported partner is liable to a person to whom
18    the  representation  is  made, if that person, relying on the
19    representation, enters into a transaction with the actual  or
20    purported  partnership.  If the representation, either by the
21    purported partner or by a person with the purported partner's
22    consent, is made in a public manner, the purported partner is
23    liable to a person who relies upon the purported  partnership
24    even  if the purported partner is not aware of being held out
25    as a  partner  to  the  claimant.  If  partnership  liability
26    results, the purported partner is liable with respect to that
27    liability  as  if the purported partner were a partner. If no
28    partnership  liability  results,  the  purported  partner  is
29    liable with respect to that liability jointly  and  severally
30    with any other person consenting to the representation.
31        (b)  If  a  person is thus represented to be a partner in
32    an existing partnership, or with  one  or  more  persons  not
33    partners,  the  purported  partner  is  an  agent  of persons
 
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 1    consenting to the representation to bind  them  to  the  same
 2    extent  and  in  the  same manner as if the purported partner
 3    were a partner,  with  respect  to  persons  who  enter  into
 4    transactions  in  reliance upon the representation. If all of
 5    the partners of  the  existing  partnership  consent  to  the
 6    representation,  a  partnership act or obligation results. If
 7    fewer than all of the partners of  the  existing  partnership
 8    consent  to  the  representation,  the  person acting and the
 9    partners consenting to the  representation  are  jointly  and
10    severally liable.
11        (c)  A  person  is not liable as a partner merely because
12    the person is named by another in a statement of  partnership
13    authority.
14        (d)  A person does not continue to be liable as a partner
15    merely   because   of  a  failure  to  file  a  statement  of
16    dissociation or to amend a statement of partnership authority
17    to indicate the partner's dissociation from the partnership.
18        (e)  Except as otherwise provided in subsections (a)  and
19    (b)  of this Section, persons who are not partners as to each
20    other are not liable as partners to other persons.

21                              ARTICLE 4
22                 RELATIONS OF PARTNERS TO EACH OTHER
23                         AND TO PARTNERSHIP

24        Section 401. Partner's rights and duties.
25        (a)  Each partner is deemed to have an account that is:
26             (1)  credited with an amount equal to the money plus
27        the value of any other property, net of the amount of any
28        liabilities, the partner contributes to  the  partnership
29        and the partner's share of the partnership profits; and
30             (2)  charged  with an amount equal to the money plus
31        the value of any other property, net of the amount of any
32        liabilities,  distributed  by  the  partnership  to   the
 
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 1        partner  and  the  partner's  share  of  the  partnership
 2        losses.
 3        (b)  Each  partner  is  entitled to an equal share of the
 4    partnership profits and is chargeable with  a  share  of  the
 5    partnership  losses  in  proportion to the partner's share of
 6    the profits.
 7        (c)  A partnership shall reimburse a partner for payments
 8    made and indemnify a partner for liabilities incurred by  the
 9    partner  in  the  ordinary  course  of  the  business  of the
10    partnership or  for  the  preservation  of  its  business  or
11    property.
12        (d)  A  partnership  shall  reimburse  a  partner  for an
13    advance to the partnership beyond the amount of  capital  the
14    partner agreed to contribute.
15        (e)  A  payment  or advance made by a partner which gives
16    rise to a partnership obligation under subsection (c) or  (d)
17    of  this  Section constitutes a loan to the partnership which
18    accrues interest from the date of the payment or advance.
19        (f)  Each partner has equal rights in the management  and
20    conduct of the partnership business.
21        (g)  A  partner  may  use or possess partnership property
22    only on behalf of the partnership.
23        (h)  A  partner  is  not  entitled  to  remuneration  for
24    services performed for the partnership, except for reasonable
25    compensation for services rendered in winding up the business
26    of the partnership.
27        (i)  A person may become a partner only with the  consent
28    of all of the partners.
29        (j)  A  difference arising as to a matter in the ordinary
30    course of business of a  partnership  may  be  decided  by  a
31    majority  of the partners. An act outside the ordinary course
32    of  business  of  a  partnership  and  an  amendment  to  the
33    partnership agreement may be undertaken only with the consent
34    of all of the partners.
 
SB2049 Engrossed            -21-               LRB9216008DJgc
 1        (k)  This Section does not affect the  obligations  of  a
 2    partnership to other persons under Section 301 of this Act.

 3        Section  402.  Distributions  in  kind.  A partner has no
 4    right to receive, and  may  not  be  required  to  accept,  a
 5    distribution in kind.

 6        Section  403. Partner's rights and duties with respect to
 7    information.
 8        (a)  A partnership shall keep its books and  records,  if
 9    any, at its chief executive office.
10        (b)  A  partnership  shall  provide  partners  and  their
11    agents  and  attorneys  access  to  its books and records. It
12    shall provide former partners and their agents and  attorneys
13    access  to  books and records pertaining to the period during
14    which they were partners. The right of  access  provides  the
15    opportunity  to  inspect  and  copy  books and records during
16    ordinary  business  hours.  A  partnership   may   impose   a
17    reasonable  charge, covering the costs of labor and material,
18    for copies of documents furnished.
19        (c)  Each partner and the partnership shall furnish to  a
20    partner,  and  to  the  legal  representative  of  a deceased
21    partner or partner under legal disability:
22             (1)  without demand, any information concerning  the
23        partnership's  business  and  affairs reasonably required
24        for the proper  exercise  of  the  partner's  rights  and
25        duties under the partnership agreement or this Act; and
26             (2)  on demand, any other information concerning the
27        partnership's  business and affairs, except to the extent
28        the demand or the information demanded is unreasonable or
29        otherwise improper under the circumstances.

30        Section 404. General standards of partner's conduct.
31        (a)  The  fiduciary  duties  a  partner   owes   to   the
 
SB2049 Engrossed            -22-               LRB9216008DJgc
 1    partnership  and  the  other  partners  include  the  duty of
 2    loyalty and the duty of care set forth in subsections (b) and
 3    (c) of this Section.
 4        (b)  A partner's duty of loyalty to the  partnership  and
 5    the other partners includes the following:
 6             (1)  to  account  to  the  partnership  and  hold as
 7        trustee for it any property, profit, or  benefit  derived
 8        by  the  partner  in  the  conduct  and winding up of the
 9        partnership business or derived from a use by the partner
10        of partnership property, including the appropriation of a
11        partnership opportunity;
12             (2)  to act fairly when a  partner  deals  with  the
13        partnership   in   the  conduct  or  winding  up  of  the
14        partnership business as or on behalf of a party having an
15        interest adverse to the partnership; and
16             (3)  to refrain from competing with the  partnership
17        in  the  conduct  of  the partnership business before the
18        dissolution of the partnership.
19        (c)  A partner's duty of care to the partnership and  the
20    other   partners  in  the  conduct  and  winding  up  of  the
21    partnership business is limited to refraining  from  engaging
22    in   grossly   negligent  or  reckless  conduct,  intentional
23    misconduct, or a knowing violation of law.
24        (d)  A partner shall discharge his or her duties  to  the
25    partnership  and  the  other partners under this Act or under
26    the partnership agreement and exercise any rights  consistent
27    with the obligation of good faith and fair dealing.
28        (e)  A  partner  does  not  violate  a duty or obligation
29    under this Act or  under  the  partnership  agreement  merely
30    because  the  partner's  conduct  furthers  the partner's own
31    interest.
32        (f)  This Section applies to  a  person  winding  up  the
33    partnership  business as the personal or legal representative
34    of the last  surviving  partner  as  if  the  person  were  a
 
SB2049 Engrossed            -23-               LRB9216008DJgc
 1    partner.

 2        Section 405. Actions by partnership and partners.
 3        (a)  A  partnership  may  maintain  an  action  against a
 4    partner for a breach of the partnership agreement, or for the
 5    violation of a duty to the partnership, causing harm  to  the
 6    partnership.
 7        (b)  A   partner  may  maintain  an  action  against  the
 8    partnership or another partner for legal or equitable relief,
 9    with or without an accounting as to partnership business, to:
10             (1)  enforce  the   partner's   rights   under   the
11        partnership agreement;
12             (2)  enforce  the  partner's  rights under this Act,
13        including:
14                  (i)  the partner's rights  under  Section  401,
15             403, or 404;
16                  (ii)  the  partner's  right  on dissociation to
17             have  the  partner's  interest  in  the  partnership
18             purchased pursuant to Section  701  or  enforce  any
19             other right under Article 6 or 7; or
20                  (iii)  the   partner's   right   to   compel  a
21             dissolution  and  winding  up  of  the   partnership
22             business  under  or  enforce  any  other right under
23             Article 8; or
24             (3)  enforce the rights and  otherwise  protect  the
25        interests  of the partner, including rights and interests
26        arising independently of the partnership relationship.
27        (c)  The accrual of, and any time limitation on, a  right
28    of  action  for  a  remedy  under this Section is governed by
29    other law. A right to an accounting upon  a  dissolution  and
30    winding up does not revive a claim barred by law.

31        Section  406. Continuation of partnership beyond definite
32    term or particular undertaking.
 
SB2049 Engrossed            -24-               LRB9216008DJgc
 1        (a)  If a partnership for a definite term  or  particular
 2    undertaking is continued, without an express agreement, after
 3    the  expiration of the term or completion of the undertaking,
 4    the rights and duties of the partners remain the same as they
 5    were at the expiration or completion, so far as is consistent
 6    with a partnership at will.
 7        (b)  If the partners, or those  of  them  who  habitually
 8    acted  in  the  business  during  the  term  or  undertaking,
 9    continue  the  business without any settlement or liquidation
10    of the partnership, they are presumed to have agreed that the
11    partnership will continue.

12                              ARTICLE 5
13                TRANSFEREES AND CREDITORS OF PARTNER

14        Section  501.  Partner  not   co-owner   of   partnership
15    property. A partner is not a co-owner of partnership property
16    and  has  no  interest  in  partnership property which can be
17    transferred, either voluntarily or involuntarily.

18        Section   502.   Partner's   transferable   interest   in
19    partnership. The only transferable interest of a  partner  in
20    the  partnership  is  the  partner's share of the profits and
21    losses of the partnership and the partner's right to  receive
22    distributions.  The interest is personal property.

23        Section 503. Transfer of partner's transferable interest.
24        (a)  A  transfer,  in  whole  or  in part, of a partner's
25    transferable interest in the partnership:
26             (1)  is permissible;
27             (2)  does  not  by  itself   cause   the   partner's
28        dissociation  or  a  dissolution  and  winding  up of the
29        partnership business; and
30             (3)  does not, as against the other partners or  the
 
SB2049 Engrossed            -25-               LRB9216008DJgc
 1        partnership,   entitle   the   transferee,   during   the
 2        continuance  of  the  partnership,  to participate in the
 3        management or conduct of  the  partnership  business,  to
 4        require  access  to  information  concerning  partnership
 5        transactions, or to inspect or copy the partnership books
 6        or records.
 7        (b)  A transferee of a partner's transferable interest in
 8    the partnership has a right:
 9             (1)  to  receive,  in  accordance with the transfer,
10        distributions to which the transferor would otherwise  be
11        entitled;
12             (2)  to  receive upon the dissolution and winding up
13        of the  partnership  business,  in  accordance  with  the
14        transfer,  the  net amount otherwise distributable to the
15        transferor; and
16             (3)  to seek under a judicial determination that  it
17        is equitable to wind up the partnership business.
18        (c)  In  a  dissolution  and  winding up, a transferee is
19    entitled to an account of partnership transactions only  from
20    the  date  of  the  latest  account  agreed  to by all of the
21    partners.
22        (d)  Upon transfer, the transferor retains the rights and
23    duties of a partner other than the interest in  distributions
24    transferred.
25        (e)  A partnership need not give effect to a transferee's
26    rights  under  this  Section  until  it  has  notice  of  the
27    transfer.
28        (f)  A  transfer  of a partner's transferable interest in
29    the partnership in violation of  a  restriction  on  transfer
30    contained in the partnership agreement is ineffective as to a
31    person  having  notice  of  the  restriction  at  the time of
32    transfer.

33        Section 504. Partner's transferable interest  subject  to
 
SB2049 Engrossed            -26-               LRB9216008DJgc
 1    charging order.
 2        (a)  On  application  by a judgment creditor of a partner
 3    or of a partner's transferee, a court having jurisdiction may
 4    charge the transferable interest of the  judgment  debtor  to
 5    satisfy the judgment. The court may appoint a receiver of the
 6    share  of  the  distributions  due  or  to  become due to the
 7    judgment debtor in respect of the partnership  and  make  all
 8    other   orders,   directions,  accounts,  and  inquiries  the
 9    judgment debtor might have made or which the circumstances of
10    the case may require.
11        (b)  A charging order constitutes a lien on the  judgment
12    debtor's  transferable interest in the partnership. The court
13    may order a  foreclosure  of  the  interest  subject  to  the
14    charging  order at any time. The purchaser at the foreclosure
15    sale has the rights of a transferee.
16        (c)  At any time before foreclosure, an interest  charged
17    may be redeemed:
18             (1)  by the judgment debtor;
19             (2)  with  property other than partnership property,
20        by one or more of the other partners; or
21             (3)  with partnership property, by one  or  more  of
22        the  other  partners  with  the  consent  of  all  of the
23        partners whose interests are not so charged.
24        (d)  This Act does not deprive a partner of a right under
25    exemption laws with respect to the partner's interest in  the
26    partnership.
27        (e)  This  Section provides the exclusive remedy by which
28    a judgment creditor of a partner or partner's transferee  may
29    satisfy  a judgment out of the judgment debtor's transferable
30    interest in the partnership.

31                              ARTICLE 6
32                       PARTNER'S DISSOCIATION
 
SB2049 Engrossed            -27-               LRB9216008DJgc
 1        Section 601. Events  causing  partner's  dissociation.  A
 2    partner is dissociated from a partnership upon the occurrence
 3    of any of the following events:
 4             (1)  the   partnership's   having   notice   of  the
 5        partner's express will to withdraw as a partner or  on  a
 6        later date specified by the partner;
 7             (2)  an event agreed to in the partnership agreement
 8        as causing the partner's dissociation;
 9             (3)  the   partner's   expulsion   pursuant  to  the
10        partnership agreement;
11             (4)  the partner's expulsion by the  unanimous  vote
12        of the other partners if:
13                  (i)  it is unlawful to carry on the partnership
14             business with that partner;
15                  (ii)  there  has  been  a  transfer  of  all or
16             substantially all  of  that  partner's  transferable
17             interest  in  the partnership, other than a transfer
18             for security purposes, or a court order charging the
19             partner's interest, which has not been foreclosed;
20                  (iii)  within 90  days  after  the  partnership
21             notifies   a  corporate  partner  that  it  will  be
22             expelled because  it  has  filed  a  certificate  of
23             dissolution  or the equivalent, its charter has been
24             revoked, or its right to conduct business  has  been
25             suspended  by the jurisdiction of its incorporation,
26             there  is  no  revocation  of  the  certificate   of
27             dissolution  or  no  reinstatement of its charter or
28             its right to conduct business; or
29                  (iv)  a partnership that is a partner has  been
30             dissolved and its business is being wound up;
31             (5)  on  application  by  the partnership or another
32        partner,   the   partner's    expulsion    by    judicial
33        determination because:
34                  (i)  the  partner  engaged  in wrongful conduct
 
SB2049 Engrossed            -28-               LRB9216008DJgc
 1             that   adversely   and   materially   affected   the
 2             partnership business;
 3                  (ii)  the  partner  willfully  or  persistently
 4             committed  a  material  breach  of  the  partnership
 5             agreement or of a duty owed to  the  partnership  or
 6             the other partners under Section 404 of this Act; or
 7                  (iii)  the  partner engaged in conduct relating
 8             to the  partnership  business  which  makes  it  not
 9             reasonably  practicable  to carry on the business in
10             partnership with the partner;
11             (6)  the partner's:
12                  (i)  becoming a debtor in bankruptcy;
13                  (ii)  executing an assignment for  the  benefit
14             of creditors;
15                  (iii)  seeking,  consenting  to, or acquiescing
16             in  the  appointment  of  a  trustee,  receiver,  or
17             liquidator  of   that   partner   or   of   all   or
18             substantially all of that partner's property; or
19                  (iv)  failing,   within   90   days  after  the
20             appointment,  to  have   vacated   or   stayed   the
21             appointment of a trustee, receiver, or liquidator of
22             the  partner  or of all or substantially all  of the
23             partner's property obtained  without  the  partner's
24             consent  or  acquiescence, or failing within 90 days
25             after  the  expiration  of  a  stay  to   have   the
26             appointment vacated;
27             (7)  in the case of a partner who is an individual:
28                  (i)  the partner's death;
29                  (ii)  the  appointment of a guardian or general
30             conservator for the partner; or
31                  (iii)  a  judicial   determination   that   the
32             partner has otherwise become incapable of performing
33             the   partner's   duties   under   the   partnership
34             agreement;
 
SB2049 Engrossed            -29-               LRB9216008DJgc
 1             (8)  in  the case of a partner that is a trust or is
 2        acting as a partner by virtue of being  a  trustee  of  a
 3        trust,  distribution  of  the trust's entire transferable
 4        interest in the partnership, but not merely by reason  of
 5        the substitution of a successor trustee;
 6             (9)  in  the  case of a partner that is an estate or
 7        is acting as a partner by  virtue  of  being  a  personal
 8        representative of an estate, distribution of the estate's
 9        entire  transferable interest in the partnership, but not
10        merely by reason  of  the  substitution  of  a  successor
11        personal representative; or
12             (10)  termination   of  a  partner  who  is  not  an
13        individual, partnership, corporation, trust, or estate.

14        Section 602.  Partner's  power  to  dissociate;  wrongful
15    dissociation.
16        (a)  A  partner  has the power to dissociate at any time,
17    rightfully or wrongfully, by express will pursuant to Section
18    601(1) of this Act.
19        (b)  A partner's dissociation is wrongful only if:
20             (1)  it is in breach of an express provision of  the
21        partnership agreement; or
22             (2)  in  the  case  of  a partnership for a definite
23        term or particular undertaking, before the expiration  of
24        the term or the completion of the undertaking:
25                  (i)  the  partner  withdraws  by  express will,
26             unless the withdrawal follows within 90  days  after
27             another partner's dissociation by death or otherwise
28             under   Section  601(6)  through  (10)  or  wrongful
29             dissociation under this subsection;
30                  (ii)  the  partner  is  expelled  by   judicial
31             determination under Section 601(5);
32                  (iii)  the partner is dissociated by becoming a
33             debtor in bankruptcy; or
 
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 1                  (iv)  in  the  case  of a partner who is not an
 2             individual, trust other than a  business  trust,  or
 3             estate,   the   partner  is  expelled  or  otherwise
 4             dissociated  because  it  willfully   dissolved   or
 5             terminated.
 6        (c)  A  partner  who  wrongfully dissociates is liable to
 7    the partnership and to the other partners for damages  caused
 8    by  the  dissociation.  The  liability  is in addition to any
 9    other obligation of the partner to the partnership or to  the
10    other partners.

11        Section 603. Effect of partner's dissociation.
12        (a)  If a partner's dissociation results in a dissolution
13    and winding up of the partnership business, Article 8 of this
14    Act applies; otherwise, Article 7 applies.
15        (b)  Upon a partner's dissociation:
16             (1)  the  partner's  right  to  participate  in  the
17        management   and  conduct  of  the  partnership  business
18        terminates, except as otherwise provided in Section 803;
19             (2)  except  as  provided  in  clause  (3)  of  this
20        subsection, a partner's duties terminate; and
21             (3)  the partner's duty  of  loyalty  under  Section
22        404(b)(1)  and  (2) and duty of care under Section 404(c)
23        continue only with regard to matters arising  and  events
24        occurring  before  the partner's dissociation, unless the
25        partner participates  in  winding  up  the  partnership's
26        business pursuant to Section 803.

27                              ARTICLE 7
28          PARTNER'S DISSOCIATION WHEN BUSINESS NOT WOUND UP

29        Section 701. Purchase of dissociated partner's interest.
30        (a)  If  a  partner  is  dissociated  from  a partnership
31    without resulting in a dissolution  and  winding  up  of  the
 
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 1    partnership  business  under  Section  801  of  this Act, the
 2    partnership shall cause the dissociated partner's interest in
 3    the partnership to be purchased for a buyout price determined
 4    pursuant to subsection (b) of this Section.
 5        (b)  The buyout price of a dissociated partner's interest
 6    is the amount that  would  have  been  distributable  to  the
 7    dissociating  partner under Section 807(b) if, on the date of
 8    dissociation, the assets of the partnership were  sold  at  a
 9    price  equal  to  the greater of the liquidation value or the
10    value based on a sale of  the  entire  business  as  a  going
11    concern  without  the dissociated partner and the partnership
12    were wound up as of that date. Interest must be paid from the
13    date of dissociation to the date of payment.
14        (c)  Damages  for  wrongful  dissociation  under  Section
15    602(b), and all other amounts owing, whether or not presently
16    due, from the dissociated partner to the partnership, must be
17    offset against the buyout price. Interest must be  paid  from
18    the date the amount owed becomes due to the date of payment.
19        (d)  A  partnership shall indemnify a dissociated partner
20    whose interest is being  purchased  against  all  partnership
21    liabilities,   whether   incurred   before   or   after   the
22    dissociation,  except  liabilities  incurred by an act of the
23    dissociated partner under Section 702.
24        (e)  If no agreement for the purchase  of  a  dissociated
25    partner's interest is reached within 120 days after a written
26    demand for payment, the partnership shall pay, or cause to be
27    paid,  in  cash  to  the  dissociated  partner the amount the
28    partnership estimates to be  the  buyout  price  and  accrued
29    interest,  reduced  by any offsets and accrued interest under
30    subsection (c).
31        (f)  If a deferred payment is authorized under subsection
32    (h), the partnership may tender a written offer  to  pay  the
33    amount  it  estimates  to  be  the  buyout  price and accrued
34    interest,  reduced  by  any  offsets  under  subsection  (c),
 
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 1    stating the time of payment, the amount and type of  security
 2    for  payment,  and  the  other  terms  and  conditions of the
 3    obligation.
 4        (g)  The payment or tender required by subsection (e)  or
 5    (f) must be accompanied by the following:
 6             (1)  a   statement   of   partnership   assets   and
 7        liabilities as of the date of dissociation;
 8             (2)  the  latest available partnership balance sheet
 9        and income statement, if any;
10             (3)  an explanation of how the estimated  amount  of
11        the payment was calculated; and
12             (4)  written  notice  that  the  payment  is in full
13        satisfaction of the obligation to purchase unless, within
14        120  days  after  the  written  notice,  the  dissociated
15        partner commences  an  action  to  determine  the  buyout
16        price,  any  offsets under subsection (c), or other terms
17        of the obligation to purchase.
18        (h)  A partner  who  wrongfully  dissociates  before  the
19    expiration  of  a  definite  term  or  the  completion  of  a
20    particular  undertaking  is  not  entitled  to payment of any
21    portion of the buyout price until the expiration of the  term
22    or   completion   of  the  undertaking,  unless  the  partner
23    establishes to the satisfaction of  the  court  that  earlier
24    payment  will not cause undue hardship to the business of the
25    partnership. A deferred payment must  be  adequately  secured
26    and bear interest.
27        (i)  A dissociated partner may maintain an action against
28    the   partnership,  pursuant  to  Section  405(b)(2)(ii),  to
29    determine the buyout price of that  partner's  interest,  any
30    offsets   under   subsection  (c),  or  other  terms  of  the
31    obligation to purchase. The action must be  commenced  within
32    120  days  after  the  partnership has tendered payment or an
33    offer to pay or within one  year  after  written  demand  for
34    payment  if no payment or offer to pay is tendered. The court
 
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 1    shall determine the buyout price of the dissociated partner's
 2    interest,  any  offset  due  under  subsection  (c)  of  this
 3    Section, and accrued interest, and  enter  judgment  for  any
 4    additional   payment   or  refund.  If  deferred  payment  is
 5    authorized  under  subsection  (h),  the  court  shall   also
 6    determine  the  security  for  payment and other terms of the
 7    obligation to  purchase.  The  court  may  assess  reasonable
 8    attorney's  fees  and  the fees and expenses of appraisers or
 9    other experts for a party to the action, in amounts the court
10    finds equitable, against a party that the court  finds  acted
11    arbitrarily,  vexatiously,  or not in good faith. The finding
12    may be based on the partnership's failure to  tender  payment
13    or an offer to pay or to comply with subsection (g).

14        Section  702.  Dissociated  partner's  power  to bind and
15    liability to partnership.
16        (a)  For 2 years  after  a  partner  dissociates  without
17    resulting  in a dissolution and winding up of the partnership
18    business, the partnership, including a surviving  partnership
19    under  Article  9  of  this  Act,  is  bound by an act of the
20    dissociated partner which would have  bound  the  partnership
21    under  Section 301 before dissociation only if at the time of
22    entering into the transaction the other party:
23             (1)  reasonably  believed   that   the   dissociated
24        partner was then a partner;
25             (2)  did   not   have   notice   of   the  partner's
26        dissociation; and
27             (3)  is not  deemed  to  have  had  knowledge  under
28        Section 303(e) or notice under Section 704(c).
29        (b)  A  dissociated  partner is liable to the partnership
30    for any damage caused to  the  partnership  arising  from  an
31    obligation   incurred   by   the  dissociated  partner  after
32    dissociation  for  which  the  partnership  is  liable  under
33    subsection (a) of this Section.
 
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 1        Section 703. Dissociated  partner's  liability  to  other
 2    persons.
 3        (a)  A   partner's   dissociation   does  not  of  itself
 4    discharge  the  partner's   liability   for   a   partnership
 5    obligation   incurred   before  dissociation.  A  dissociated
 6    partner is not liable for a partnership  obligation  incurred
 7    after   dissociation,   except   as   otherwise  provided  in
 8    subsection (b) of this Section.
 9        (b)  A partner who dissociates  without  resulting  in  a
10    dissolution  and  winding  up  of the partnership business is
11    liable as a partner to  the  other  party  in  a  transaction
12    entered  into  by the partnership, or a surviving partnership
13    under Article 9  of  this  Act,  within  2  years  after  the
14    partner's dissociation, only if the partner is liable for the
15    obligation under Section 306 and at the time of entering into
16    the transaction the other party:
17             (1)  reasonably   believed   that   the  dissociated
18        partner was then a partner;
19             (2)  did  not   have   notice   of   the   partner's
20        dissociation; and
21             (3)  is  not  deemed  to  have  had  knowledge under
22        Section 303(e) or notice under Section 704(c).
23        (c)  By agreement with the partnership creditor  and  the
24    partners  continuing  the business, a dissociated partner may
25    be released from liability for a partnership obligation.
26        (d)  A dissociated partner is released from liability for
27    a partnership obligation  if  a  partnership  creditor,  with
28    notice   of   the  partner's  dissociation  but  without  the
29    partner's consent, agrees to a  material  alteration  in  the
30    nature or time of payment of a partnership obligation.

31        Section 704. Statement of dissociation.
32        (a)  A  dissociated partner or the partnership may file a
33    statement of dissociation stating the name of the partnership
 
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 1    and that the partner is dissociated from the partnership.
 2        (b)  A statement of dissociation is a limitation  on  the
 3    authority  of  a  dissociated  partner  for  the  purposes of
 4    Section 303(d) and (e).
 5        (c)  For the purposes of Sections 702(a)(3) and 703(b)(3)
 6    of this Act, a person not a partner is deemed to have  notice
 7    of   the   dissociation   90  days  after  the  statement  of
 8    dissociation is filed.

 9        Section 705. Continued use of partnership name. Continued
10    use of a partnership name, or a dissociated partner's name as
11    part thereof, by partners continuing the business does not of
12    itself make the dissociated partner liable for an  obligation
13    of the partners or the partnership continuing the business.

14                              ARTICLE 8
15                   WINDING UP PARTNERSHIP BUSINESS

16        Section 801. Events causing dissolution and winding up of
17    partnership  business.  A  partnership  is dissolved, and its
18    business must be wound up, only upon the occurrence of any of
19    the following events:
20             (1)  in a partnership  at  will,  the  partnership's
21        having notice from a partner, other than a partner who is
22        dissociated  under  Section  601(2) through (10), of that
23        partner's express will to withdraw as a partner, or on  a
24        later date specified by the partner;
25             (2)  in   a  partnership  for  a  definite  term  or
26        particular undertaking:
27                  (i)  within   90   days   after   a   partner's
28             dissociation by death  or  otherwise  under  Section
29             601(6)  through  (10) or wrongful dissociation under
30             Section 602(b), the express will of at least half of
31             the remaining partners to wind  up  the  partnership
 
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 1             business,  for  which  purpose  a partner's rightful
 2             dissociation  pursuant   to   Section   602(b)(2)(i)
 3             constitutes the expression of that partner's will to
 4             wind up the partnership business;
 5                  (ii)  the  express  will of all of the partners
 6             to wind up the partnership business; or
 7                  (iii)  the  expiration  of  the  term  or   the
 8             completion of the undertaking;
 9             (3)  an event agreed to in the partnership agreement
10        resulting in the winding up of the partnership business;
11             (4)  an  event  that  makes  it  unlawful for all or
12        substantially all of the business of the  partnership  to
13        be  continued,  but  a  cure of illegality within 90 days
14        after notice to the partnership of the event is effective
15        retroactively to the date of the event  for  purposes  of
16        this Section;
17             (5)  on   application   by  a  partner,  a  judicial
18        determination that:
19                  (i)  the economic purpose of the partnership is
20             likely to be unreasonably frustrated;
21                  (ii)  another partner has  engaged  in  conduct
22             relating  to the partnership business which makes it
23             not reasonably practicable to carry on the  business
24             in partnership with that partner; or
25                  (iii)  it    is    not   otherwise   reasonably
26             practicable to carry on the partnership business  in
27             conformity with the partnership agreement; or
28             (6)  on  application  by a transferee of a partner's
29        transferable interest, a judicial determination  that  it
30        is equitable to wind up the partnership business:
31                  (i)  after   the  expiration  of  the  term  or
32             completion of the undertaking,  if  the  partnership
33             was for a definite term or particular undertaking at
34             the  time  of  the transfer or entry of the charging
 
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 1             order that gave rise to the transfer; or
 2                  (ii)  at any time, if  the  partnership  was  a
 3             partnership  at  will at the time of the transfer or
 4             entry of the charging order that gave  rise  to  the
 5             transfer.

 6        Section 802. Partnership continues after dissolution.
 7        (a)  Subject   to  subsection  (b)  of  this  Section,  a
 8    partnership continues after dissolution only for the  purpose
 9    of  winding  up  its  business. The partnership is terminated
10    when the winding up of its business is completed.
11        (b)  At any time after the dissolution of  a  partnership
12    and  before  the winding up of its business is completed, all
13    of the partners, including  any  dissociating  partner  other
14    than  a  wrongfully dissociating partner, may waive the right
15    to  have  the  partnership's  business  wound  up   and   the
16    partnership terminated. In that event:
17             (1)  the   partnership   resumes   carrying  on  its
18        business as if dissolution had never  occurred,  and  any
19        liability  incurred by the partnership or a partner after
20        the dissolution and before the waiver is determined as if
21        dissolution had never occurred; and
22             (2)  the rights of  a  third  party  accruing  under
23        Section  804(1)  of this Act or arising out of conduct in
24        reliance on the dissolution before the third  party  knew
25        or  received  a  notification  of  the  waiver may not be
26        adversely affected.

27        Section 803. Right to wind up partnership business.
28        (a)  After dissolution, a partner who has not  wrongfully
29    dissociated  may  participate in winding up the partnership's
30    business, but on application of any partner, partner's  legal
31    representative,  or  transferee,  the  appropriate court, for
32    good cause shown,  may  order  judicial  supervision  of  the
 
SB2049 Engrossed            -38-               LRB9216008DJgc
 1    winding up.
 2        (b)  The  legal  representative  of  the  last  surviving
 3    partner may wind up a partnership's business.
 4        (c)  A  person  winding  up  a partnership's business may
 5    preserve the partnership business  or  property  as  a  going
 6    concern  for  a reasonable time, prosecute and defend actions
 7    and proceedings, whether civil, criminal, or  administrative,
 8    settle  and  close the partnership's business, dispose of and
 9    transfer   the   partnership's   property,   discharge    the
10    partnership's  liabilities,  distribute  the  assets  of  the
11    partnership  pursuant  to  Section  807,  settle  disputes by
12    mediation or arbitration, and perform other necessary acts.

13        Section 804. Partner's power to  bind  partnership  after
14    dissolution.   Subject   to   Section  805  of  this  Act,  a
15    partnership is bound by a  partner's  act  after  dissolution
16    that:
17             (1)  is  appropriate  for winding up the partnership
18        business; or
19             (2)  would have bound the partnership under  Section
20        301  before  dissolution,  if  the  other  party  to  the
21        transaction did not have notice of the dissolution.

22        Section 805. Statement of dissolution.
23        (a)  After  dissolution, a partner who has not wrongfully
24    dissociated may file a statement of dissolution  stating  the
25    name   of  the  partnership  and  that  the  partnership  has
26    dissolved and is winding up its business.
27        (b)  A statement of dissolution cancels a filed statement
28    of partnership authority for the purposes of  Section  303(d)
29    and  is a limitation on authority for the purposes of Section
30    303(e).
31        (c)  For the purposes of Sections 301 and 804,  a  person
32    not a partner is deemed to have notice of the dissolution and
 
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 1    the  limitation on the partners' authority as a result of the
 2    statement of dissolution 90 days after it is filed.
 3        (d)  After  filing  and,  if  appropriate,  recording   a
 4    statement  of  dissolution,  a dissolved partnership may file
 5    and,  if  appropriate,  record  a  statement  of  partnership
 6    authority which will operate with respect to a person  not  a
 7    partner  as  provided  in  Section  303(d)  and  (e)  in  any
 8    transaction,  whether  or  not the transaction is appropriate
 9    for winding up the partnership business.

10        Section 806. Partner's liability to other partners  after
11    dissolution.
12        (a)  Except  as  otherwise  provided in subsection (b) of
13    this Section and Section 306 of this Act, after dissolution a
14    partner is liable to the other  partners  for  the  partner's
15    share  of  any  partnership  liability incurred under Section
16    804.
17        (b)  A partner who, with knowledge  of  the  dissolution,
18    incurs a partnership liability under Section 804(2) by an act
19    that  is  not  appropriate  for  winding  up  the partnership
20    business is liable to the partnership for any  damage  caused
21    to the partnership arising from the liability.

22        Section  807.  Settlement  of  accounts and contributions
23    among partners.
24        (a)  In winding up a partnership's business,  the  assets
25    of  the  partnership,  including  the  contributions  of  the
26    partners  required  by  this  Section,  must  be  applied  to
27    discharge  its  obligations  to  creditors, including, to the
28    extent permitted by law,  partners  who  are  creditors.  Any
29    surplus  must  be  applied  to  pay  in  cash  the net amount
30    distributable to partners in accordance with their  right  to
31    distributions under subsection (b) of this Section.
32        (b)  Each  partner  is  entitled  to  a settlement of all
 
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 1    partnership  accounts  upon  winding   up   the   partnership
 2    business.  In  settling  accounts among the partners, profits
 3    and  losses  that  result  from  the   liquidation   of   the
 4    partnership  assets  must  be  credited  and  charged  to the
 5    partners' accounts. The partnership shall make a distribution
 6    to a partner in an amount equal to any excess of the  credits
 7    over  the  charges  in the partner's account. A partner shall
 8    contribute to the partnership an amount equal to  any  excess
 9    of  the charges over the credits in the partner's account but
10    excluding from the calculation  charges  attributable  to  an
11    obligation  for  which  the  partner is not personally liable
12    under Section 306 of this Act.
13        (c)  If a partner fails to  contribute  the  full  amount
14    required  under  subsection  (b)  of this Section, all of the
15    other partners shall contribute, in the proportions in  which
16    those  partners  share  partnership  losses,  the  additional
17    amount  necessary  to satisfy the partnership obligations for
18    which they are personally liable under Section 306. A partner
19    or partner's legal representative may recover from the  other
20    partners  any  contributions  the partner makes to the extent
21    the amount contributed exceeds that partner's  share  of  the
22    partnership  obligations  for which the partner is personally
23    liable under Section 306.
24        (d)  After the settlement of accounts, each partner shall
25    contribute, in the proportion in  which  the  partner  shares
26    partnership   losses,   the   amount   necessary  to  satisfy
27    partnership obligations that were not known at  the  time  of
28    the settlement and for which the partner is personally liable
29    under Section 306.
30        (e)  The  estate  of a deceased partner is liable for the
31    partner's obligation to contribute to the partnership.
32        (f)  An assignee  for  the  benefit  of  creditors  of  a
33    partnership or a partner, or a person appointed by a court to
34    represent  creditors  of  a  partnership  or  a  partner, may
 
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 1    enforce  a  partner's  obligation  to   contribute   to   the
 2    partnership.

 3                              ARTICLE 9
 4                       CONVERSIONS AND MERGERS

 5        Section 901. Definitions. In this article:
 6             (1)  "General   partner"   means   a  partner  in  a
 7        partnership  and  a  general   partner   in   a   limited
 8        partnership.
 9             (2)  "Limited  partner" means a limited partner in a
10        limited partnership.
11             (3)  "Limited   partnership"   means    a    limited
12        partnership  created  under  the  Revised Uniform Limited
13        Partnership Act, predecessor law, or  comparable  law  of
14        another jurisdiction.
15             (4)  "Partner" includes both a general partner and a
16        limited partner.

17        Section   902.   Conversion  of  partnership  to  limited
18    partnership.
19        (a)  A  partnership  may  be  converted  to   a   limited
20    partnership pursuant to this Section.
21        (b)  The  terms  and  conditions  of  a  conversion  of a
22    partnership to a limited partnership must be approved by  all
23    of  the  partners  or by a number or percentage specified for
24    conversion in the partnership agreement.
25        (c)  After the conversion is approved  by  the  partners,
26    the   partnership   shall   file  a  certificate  of  limited
27    partnership  in  the  jurisdiction  in  which   the   limited
28    partnership is to be formed. The certificate must include:
29             (1)  a  statement that the partnership was converted
30        to a limited partnership from a partnership;
31             (2)  its former name; and
 
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 1             (3)  a statement of the number of votes cast by  the
 2        partners  for and against the conversion and, if the vote
 3        is less than unanimous, the number or percentage required
 4        to  approve  the   conversion   under   the   partnership
 5        agreement.
 6        (d)  The  conversion takes effect when the certificate of
 7    limited partnership is filed or at any later  date  specified
 8    in the certificate.
 9        (e)  A general partner who becomes a limited partner as a
10    result  of the conversion remains liable as a general partner
11    for an obligation incurred  by  the  partnership  before  the
12    conversion  takes effect. If the other party to a transaction
13    with  the  limited  partnership  reasonably   believes   when
14    entering  the  transaction  that  the  limited  partner  is a
15    general  partner,  the  limited  partner  is  liable  for  an
16    obligation incurred by the limited partnership within 90 days
17    after the conversion  takes  effect.  The  limited  partner's
18    liability   for   all   other   obligations  of  the  limited
19    partnership incurred after the  conversion  takes  effect  is
20    that  of a limited partner as provided in the Revised Uniform
21    Limited Partnership Act.

22        Section  903.  Conversion  of  limited   partnership   to
23    partnership.
24        (a)  A   limited   partnership  may  be  converted  to  a
25    partnership pursuant to this Section.
26        (b)  Notwithstanding a provision to  the  contrary  in  a
27    limited  partnership agreement, the terms and conditions of a
28    conversion of a limited partnership to a partnership must  be
29    approved by all of the partners.
30        (c)  After  the  conversion  is approved by the partners,
31    the limited  partnership  shall  cancel  its  certificate  of
32    limited partnership.
33        (d)  The  conversion takes effect when the certificate of
 
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 1    limited partnership is canceled.
 2        (e)  A limited partner who becomes a general partner as a
 3    result of the conversion remains liable  only  as  a  limited
 4    partner for an obligation incurred by the limited partnership
 5    before  the  conversion  takes  effect.  Except  as otherwise
 6    provided in Section 306, the partner is liable as  a  general
 7    partner  for  an obligation of the partnership incurred after
 8    the conversion takes effect.

 9        Section 904. Effect of conversion; entity unchanged.
10        (a)  A partnership or limited partnership that  has  been
11    converted  pursuant  to  this article is for all purposes the
12    same entity that existed before the conversion.
13        (b)  When a conversion takes effect:
14             (1)  all   property   owned   by   the    converting
15        partnership  or limited partnership remains vested in the
16        converted entity;
17             (2)  all obligations of the  converting  partnership
18        or  limited  partnership  continue  as obligations of the
19        converted entity; and
20             (3)  an action or  proceeding  pending  against  the
21        converting  partnership  or  limited  partnership  may be
22        continued as if the conversion had not occurred.

23        Section 905. Merger of partnerships.
24        (a)  Pursuant to a plan of merger approved as provided in
25    subsection (c) of this Section, a partnership may  be  merged
26    with one or more partnerships or limited partnerships.
27        (b)  The plan of merger must set forth:
28             (1)  the   name   of  each  partnership  or  limited
29        partnership that is a party to the merger;
30             (2)  the name of the surviving entity into which the
31        other partnerships or limited partnerships will merge;
32             (3)  whether the surviving entity is  a  partnership
 
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 1        or a limited partnership and the status of each partner;
 2             (4)  the terms and conditions of the merger;
 3             (5)  the   manner   and   basis  of  converting  the
 4        interests of each party to the merger into  interests  or
 5        obligations  of  the  surviving  entity, or into money or
 6        other property in whole or part; and
 7             (6)  the street address of  the  surviving  entity's
 8        chief executive office.
 9        (c)  The plan of merger must be approved:
10             (1)  in the case of a partnership that is a party to
11        the  merger,  by  all  of  the  partners,  or a number or
12        percentage  specified  for  merger  in  the   partnership
13        agreement; and
14             (2)  in  the case of a limited partnership that is a
15        party to the merger, by the vote required for approval of
16        a merger by the law of the State or foreign  jurisdiction
17        in which the limited partnership is organized and, in the
18        absence  of such a specifically applicable law, by all of
19        the partners, notwithstanding a provision to the contrary
20        in the partnership agreement.
21        (d)  After a plan of merger is approved  and  before  the
22    merger  takes effect, the plan may be amended or abandoned as
23    provided in the plan.
24        (e)  The merger takes effect on the later of:
25             (1)  the approval of  the  plan  of  merger  by  all
26        parties to the merger, as provided in subsection (c);
27             (2)  the  filing of all documents required by law to
28        be filed as a  condition  to  the  effectiveness  of  the
29        merger; or
30             (3)  any  effective  date  specified  in the plan of
31        merger.

32        Section 906. Effect of merger.
33        (a)  When a merger takes effect:
 
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 1             (1)  the separate existence of every partnership  or
 2        limited  partnership that is a party to the merger, other
 3        than the surviving entity, ceases;
 4             (2)  all  property  owned  by  each  of  the  merged
 5        partnerships  or  limited  partnerships  vests   in   the
 6        surviving entity;
 7             (3)  all obligations of every partnership or limited
 8        partnership  that  is  a  party  to the merger become the
 9        obligations of the surviving entity; and
10             (4)  an  action  or  proceeding  pending  against  a
11        partnership or limited partnership that is a party to the
12        merger  may  be  continued  as  if  the  merger  had  not
13        occurred, or the surviving entity may be substituted as a
14        party to the action or proceeding.
15        (b)  The Secretary of State of this State  is  the  agent
16    for  service  of process in an action or proceeding against a
17    surviving  foreign  partnership  or  limited  partnership  to
18    enforce an obligation of a domestic  partnership  or  limited
19    partnership that is a party to a merger. The surviving entity
20    shall  promptly  notify the Secretary of State of the mailing
21    address of its chief executive office and of  any  change  of
22    address.  Upon  receipt  of  process,  the Secretary of State
23    shall mail a copy of the process  to  the  surviving  foreign
24    partnership or limited partnership.
25        (c)  A  partner  of  the surviving partnership or limited
26    partnership is liable for:
27             (1)  all obligations of a party to  the  merger  for
28        which  the  partner  was  personally  liable  before  the
29        merger;
30             (2)  all  other  obligations of the surviving entity
31        incurred before the merger by a party to the merger,  but
32        those  obligations  may be satisfied only out of property
33        of the entity; and
34             (3)  except as otherwise provided in Section 306  of
 
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 1        this   Act,  all  obligations  of  the  surviving  entity
 2        incurred  after  the  merger  takes  effect,  but   those
 3        obligations  may be satisfied only out of property of the
 4        entity if the partner is a limited partner.
 5        (d)  If the obligations incurred before the merger  by  a
 6    party  to the merger are not satisfied out of the property of
 7    the surviving partnership or limited partnership, the general
 8    partners of that party immediately before the effective  date
 9    of  the  merger  shall  contribute  the  amount  necessary to
10    satisfy that party's obligations to the surviving entity,  in
11    the  manner  provided  in  Section  807  or  in  the  Limited
12    Partnership  Act  of  the jurisdiction in which the party was
13    formed, as the case may be,  as  if  the  merged  party  were
14    dissolved.
15        (e)  A partner of a party to a merger who does not become
16    a partner of the surviving partnership or limited partnership
17    is  dissociated  from the entity, of which that partner was a
18    partner,  as  of  the  date  the  merger  takes  effect.  The
19    surviving entity shall cause the partner's  interest  in  the
20    entity  to  be  purchased  under  Section  701 of this Act or
21    another statute specifically  applicable  to  that  partner's
22    interest  with  respect  to a merger. The surviving entity is
23    bound under Section 702  by  an  act  of  a  general  partner
24    dissociated  under this subsection, and the partner is liable
25    under Section  703  for  transactions  entered  into  by  the
26    surviving entity after the merger takes effect.

27        Section 907. Statement of merger.
28        (a)  After a merger, the surviving partnership or limited
29    partnership   may   file   a   statement  that  one  or  more
30    partnerships or limited partnerships  have  merged  into  the
31    surviving entity.
32        (b)  A statement of merger must contain:
33             (1)  the   name   of  each  partnership  or  limited
 
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 1        partnership that is a party to the merger;
 2             (2)  the name of the surviving entity into which the
 3        other partnerships or limited partnerships were merged;
 4             (3)  the street address of  the  surviving  entity's
 5        chief executive office and of an office in this State, if
 6        any; and
 7             (4)  whether  the  surviving entity is a partnership
 8        or a limited partnership.
 9        (c)  Except as otherwise provided in  subsection  (d)  of
10    this  Section,  for  the purposes of Section 302, property of
11    the surviving partnership or limited partnership which before
12    the merger was held in the  name  of  another  party  to  the
13    merger  is  property held in the name of the surviving entity
14    upon filing a statement of merger.
15        (d)  For the purposes of Section 302,  real  property  of
16    the surviving partnership or limited partnership which before
17    the  merger  was  held  in  the  name of another party to the
18    merger is property held in the name of the  surviving  entity
19    upon recording a certified copy of the statement of merger in
20    the office for recording transfers of that real property.
21        (e)  A  filed  and, if appropriate, recorded statement of
22    merger, executed and declared  to  be  accurate  pursuant  to
23    Section  105(c), stating the name of a partnership or limited
24    partnership that is a party  to  the  merger  in  whose  name
25    property  was  held  before  the  merger  and the name of the
26    surviving  entity,  but  not  containing  all  of  the  other
27    information required  by  subsection  (b)  of  this  Section,
28    operates   with   respect  to  the  partnerships  or  limited
29    partnerships named to the extent provided in subsections  (c)
30    and (d).

31        Section  908. Merger of partnership and limited liability
32    company.
33        (a)  Under a plan of merger approved under subsection (c)
 
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 1    of this Section, any one or more partnerships of  this  State
 2    may  merge  with  or  into  one  or  more  limited  liability
 3    companies  of  this   State, any other state or states of the
 4    United States, or the District of Columbia, if  the  laws  of
 5    the  other state or states or the District of Columbia permit
 6    the merger. The partnership or partnerships and  the  limited
 7    liability  company  or  companies  may  merge  with or into a
 8    partnership, which may be any one of these  partnerships,  or
 9    they  may  merge  with  or  into a limited liability company,
10    which may be any one of these  limited  liability  companies,
11    which  shall be a partnership or limited liability company of
12    this State, any other state of  the  United  States,  or  the
13    District of Columbia, which permits the merger.
14        (b)  A   plan  of  merger  must  set  forth  all  of  the
15    following:
16             (1)  The name of each entity that is a party to  the
17        merger.
18             (2)  The name of the surviving entity into which the
19        other entities will merge.
20             (3)  The  type  of  organization  of  the  surviving
21        entity.
22             (4)  The terms and conditions of the merger.
23             (5)  The   manner   and  basis  for  converting  the
24        interests of each party to  the  merger  into  interests,
25        obligations, or other securities of the surviving entity,
26        or into money or other property in whole or in part.
27             (6)  The  street  address  of the surviving entity's
28        principal place of business.
29        (c)  The plan of merger required  by  subsection  (b)  of
30    this  Section must be approved by each party to the merger in
31    accordance with all of the following:
32             (1)  In the case of a partnership,  by  all  of  the
33        partners  or  by the number or percentage of the partners
34        required to approve a merger specified in the partnership
 
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 1        agreement.
 2             (2)  In the case of a limited liability company,  by
 3        all  members  or  by  the number or percentage of members
 4        required to approve a merger specified in  the  operating
 5        agreement.
 6        (d)  After  a  plan  of merger is approved and before the
 7    merger takes effect, the plan may be amended or abandoned  as
 8    provided in the plan of merger.
 9        (e)  After  approval  of  the  plan  of merger under this
10    Section, unless the merger is abandoned under subsection  (d)
11    of  this  Section,  a  statement  of merger must be signed on
12    behalf of each party to  the  merger  and  delivered  to  the
13    Secretary of State of this State for filing. The statement of
14    merger must set forth all of the following:
15             (1)  The   name  and,  in  the  case  of  a  limited
16        liability partnership, jurisdiction of  each  partnership
17        and  the  name  and  jurisdiction of organization of each
18        limited liability company that is a party to the merger.
19             (2)  That a plan of merger  has  been  approved  and
20        signed  by  each  partnership  and each limited liability
21        company that is a party to the merger.
22             (3)  The  name  and   address   of   the   surviving
23        partnership or surviving limited liability company.
24             (4)  The effective date of the merger.
25             (5)  If  a  party to the merger is a foreign limited
26        liability  company  or  a   foreign   limited   liability
27        partnership,  the  jurisdiction and date of the filing of
28        its   articles   of   organization   or   statement    of
29        qualification,  as the case may be, and the date when its
30        application for authority was filed with the Secretary of
31        State of this State or, if an application  has  not  been
32        filed, a statement to that effect.
33             (6)  If the surviving entity is not a partnership or
34        limited  liability  company  organized  under the laws of
 
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 1        this State, an agreement that the surviving entity may be
 2        served with process in  this  State  and  is  subject  to
 3        liability in any action or proceeding for the enforcement
 4        of  any  liability  or  obligation  of any partnership or
 5        limited liability company which is a party to the  merger
 6        or  which  was  previously subject to suit in this State,
 7        and for the enforcement, as provided in this Act, of  the
 8        right  of  partners  of any partnership or members of any
 9        limited liability company to receive  payment  for  their
10        interests   in   the  partnership  or  limited  liability
11        company, as  the  case  may  be,  against  the  surviving
12        entity.
13        (f)  If  a foreign limited liability company or a foreign
14    limited liability partnership is the surviving  entity  of  a
15    merger,  it  may  not  do  business  in  this  State until an
16    application for that authority is filed with the Secretary of
17    State.
18        (g)  The surviving  partnership  or  other  entity  shall
19    furnish a copy of the plan of merger, on request, and without
20    cost,  to any person holding an interest in an entity that is
21    to merge.
22        (h)  To the  extent  that  the  statement  of  merger  is
23    inconsistent  with  the articles of organization of a limited
24    liability company or the  statement  of  qualification  of  a
25    limited  liability partnership, the statement of merger shall
26    operate as an amendment to the articles  of  organization  or
27    statement of qualification, as the case may be.
28        (i)  The  merger  is  effective  upon  the  filing of the
29    statement of merger with  the  Secretary  of  State  of  this
30    State,  or  on  a later date as specified in the statement of
31    merger not later than 30 days subsequent to the filing of the
32    statement of merger under subsection (e) of this Section.
33        (j)  When  any  merger  becomes  effective   under   this
34    Section:
 
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 1             (1)  the  separate existence of each partnership and
 2        each limited liability company that is  a  party  to  the
 3        merger, other than the surviving entity, terminates;
 4             (2)  all property owned by each partnership and each
 5        limited  liability  company that is a party to the merger
 6        vests in the surviving entity;
 7             (3)  all debts, liabilities, and  other  obligations
 8        of  each  partnership  and each limited liability company
 9        that is a party to the merger become the  obligations  of
10        the surviving entity;
11             (4)  an   action  or  proceeding  by  or  against  a
12        partnership or limited liability company that  is a party
13        to the merger may be continued as if the merger  had  not
14        occurred  or the surviving entity may be substituted as a
15        party to the action or proceeding; and
16             (5)  except as prohibited  by  other  law,  all  the
17        rights,  privileges,  immunities, powers, and purposes of
18        each partnership and limited liability company that is  a
19        party to the merger vest in the surviving entity.
20        (k)  The Secretary of State of this State is an agent for
21    service  of  process  in  an action or proceeding against any
22    surviving foreign entity to  enforce  an  obligation  of  any
23    party  to  a  merger if the surviving foreign entity fails to
24    appoint or  maintain  an  agent  designated  for  service  of
25    process  in  this  State  or the agent for service of process
26    cannot with reasonable diligence be found at  the  designated
27    office.  Service is effected under this subsection (k) at the
28    earliest of:
29             (1)  the date  the  surviving  entity  receives  the
30        process notice or demand;
31             (2)  the date shown on the return receipt, if signed
32        on behalf of the surviving entity; or
33             (3)  5 days after its deposit in the mail, if mailed
34        postpaid and correctly addressed.
 
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 1        (l)  Service  under  subsection (k) of this Section shall
 2    be made by the person instituting the action by doing all  of
 3    the following:
 4             (1)  Serving  on  the  Secretary  of  State  of this
 5        State, or  on  any  employee  having  responsibility  for
 6        administering  this  Act  in his or her office, a copy of
 7        the process, notice, or demand, together with any  papers
 8        required  by  law  to  be  delivered  in  connection with
 9        service and paying the fee prescribed by Section  108  of
10        this Act.
11             (2)  Transmitting  notice  of  the  service  on  the
12        Secretary  of  State  of  this  State  and  a copy of the
13        process, notice, or demand and accompanying papers to the
14        surviving entity being served, by registered or certified
15        mail at the address set forth in the statement of merger.
16             (3)  Attaching an affidavit of compliance with  this
17        Section,  in substantially the form that the Secretary of
18        State of  this  State  may  by  rule  prescribe,  to  the
19        process, notice, or demand.
20        (m)  Nothing  contained  in  this  Section shall limit or
21    affect the right to serve  any  process,  notice,  or  demand
22    required  or permitted by law to be served upon a partnership
23    in any other manner now or hereafter permitted by law.
24        (n)  The Secretary of State of this State shall keep, for
25    a period of 5 years from the date of service, a record of all
26    processes, notices, and demands served upon him or her  under
27    this Section and shall record the time of the service and the
28    person's action with reference to the service.
29        (o)  Except  as  provided  by  agreement with a person to
30    whom a partner of a partnership is obligated, a merger  of  a
31    partnership  that  has  become effective shall not affect any
32    obligation or liability existing at the time of the merger of
33    a partner of a partnership that is merging.
 
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 1        Section  909.  Approval  of  conversion  into  a  limited
 2    liability company. A partnership may convert into  a  limited
 3    liability  company  organized,  formed,  or created under the
 4    laws of this  State,  upon  approval  of  the  conversion  in
 5    accordance  with  this Section. The terms and conditions of a
 6    conversion of a partnership to a  limited  liability  company
 7    must  be  approved  by  all of the partners or by a number or
 8    percentage of the partners required  for  conversion  in  the
 9    partnership agreement.
10        After  a  conversion  is  approved, the partnership shall
11    file articles of organization in the Office of the  Secretary
12    of  State  in accordance with subsection (d) of Section 37-10
13    of the Limited Liability Company Act.

14        Section 910. Nonexclusive. This Article is not exclusive.
15    Partnerships or limited  partnerships  may  be  converted  or
16    merged in any other manner provided by law.

17                             ARTICLE 10
18                    LIMITED LIABILITY PARTNERSHIP

19        Section 1001. Statement of qualification.
20        (a)  A   partnership   may  become  a  limited  liability
21    partnership pursuant to this Section.
22        (b)  The terms and  conditions  on  which  a  partnership
23    becomes  a  limited liability partnership must be approved by
24    the vote necessary to amend the partnership agreement except,
25    in  the  case  of  a  partnership  agreement  that  expressly
26    considers obligations to contribute to the  partnership,  the
27    vote necessary to amend those provisions.
28        (c)  After  the  approval  required  by subsection (b) of
29    this Section, a partnership may become  a  limited  liability
30    partnership  by  filing a statement of qualification with the
31    Secretary of State. The statement must contain:
 
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 1             (1)  the name of the partnership;
 2             (2)  the street address of the  partnership's  chief
 3        executive office and, if different, the street address of
 4        an office in this State, if any;
 5             (3)  the    name   and   street   address   of   the
 6        partnership's agent for service of process;
 7             (4)  the number of partners;
 8             (5)  a brief statement of the business in which  the
 9        partnership engages;
10             (6)  a  statement  that  the partnership applies for
11        qualification as a limited liability partnership; and
12             (7)  a  deferred  effective  date,  if  any,  of  an
13        application   for   status   as   a   limited   liability
14        partnership.
15        (d)  The agent of a  limited  liability  partnership  for
16    service of process must be an individual who is a resident of
17    this  State or other person authorized to do business in this
18    State.
19        (e)  The status of a partnership as a  limited  liability
20    partnership  is  effective  on the later of the filing of the
21    statement or a  date  specified  in  the  statement  and  the
22    receipt  by  the  Secretary of State of the required fee. The
23    status remains effective  for  one  year  after  the  date  a
24    statement of qualification is filed, regardless of changes in
25    the partnership, unless the partnership voluntarily withdraws
26    by  filing  a  statement  of  withdrawal,  in which event the
27    status of the partnership as a limited liability  partnership
28    shall  terminate  on  the date such statement is filed or, if
29    later, a date specified on the statement.
30        (f)  The status of a partnership as a  limited  liability
31    partnership and the liability of its partners is not affected
32    by  errors or later changes in the information required to be
33    contained in the  statement of qualification under subsection
34    (c) of this Section.
 
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 1        (g)  The  filing  of   a   statement   of   qualification
 2    establishes  that  a partnership has satisfied all conditions
 3    precedent to  the  qualification  of  the  partnership  as  a
 4    limited liability partnership.
 5        (h)  An  amendment  or  cancellation  of  a  statement of
 6    qualification is effective when it is filed or on a  deferred
 7    effective date specified in the amendment or cancellation.
 8        (i)  The  Secretary  of State shall register as a limited
 9    liability  partnership  any  partnership   that   submits   a
10    completed application with the required fee.
11        (j)  The  Secretary of State shall provide statements for
12    registration  application,  renewal   of   registration   and
13    voluntary cancellation.

14        Section  1002.  Name.  The  name  of  a limited liability
15    partnership  must  end  with  "Registered  Limited  Liability
16    Partnership", "Limited  Liability  Partnership",  "R.L.L.P.",
17    "L.L.P.", "RLLP", or "LLP".

18        Section 1003. Renewal statements.
19        (a)  A  limited  liability  partnership,  and  a  foreign
20    limited liability partnership authorized to transact business
21    in  this  State, shall file a renewal statement in the Office
22    of the Secretary of State which contains:
23             (1)  the name of the partnership;
24             (2)  the street address of the  partnership's  chief
25        executive office and, if different, the street address of
26        an office in this State, if any;
27             (3)  the    name   and   street   address   of   the
28        partnership's agent for service of process;
29             (4)  if  the  partnership  is  a  domestic   limited
30        liability partnership, the number of partners;
31             (5)  a  brief statement of the business in which the
32        partnership engages; and
 
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 1             (6)  if  the  partnership  is  a   foreign   limited
 2        liability partnership, a current certificate of status in
 3        good   standing   as   a   registered  limited  liability
 4        partnership under the laws of that state or jurisdiction.
 5        (b)  Qualification as a  limited  liability  partnership,
 6    whether  pursuant  to  an  original  statement  or  a renewal
 7    statement, is renewed if, during the 60 day period  preceding
 8    the date the initial statement or renewal statement otherwise
 9    would  have expired, the partnership files with the Secretary
10    of State a renewal statement. A renewal statement expires one
11    year after the date an original statement would have  expired
12    if the last renewal of the statement had not occurred.
13        (c)  The  Secretary of State shall renew the registration
14    of any limited liability partnership of any partnership  that
15    submits a renewal statement with the required fee.

16                             ARTICLE 11
17                FOREIGN LIMITED LIABILITY PARTNERSHIP

18        Section  1101.  Law  governing  foreign limited liability
19    partnership.
20        (a)  The law under  which  a  foreign  limited  liability
21    partnership  is  formed  governs relations among the partners
22    and  between  the  partners  and  the  partnership  and   the
23    liability of partners for obligations of the partnership.
24        (b)  A  foreign  limited liability partnership may not be
25    denied a statement of foreign qualification by reason of  any
26    difference  between  the  law under which the partnership was
27    formed and the law of this State.
28        (c)  A  statement  of  foreign  qualification  does   not
29    authorize  a  foreign limited liability partnership to engage
30    in any business or exercise any power that a partnership  may
31    not  engage  in  or  exercise  in  this  State  as  a limited
32    liability partnership.
 
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 1        Section 1102. Statement of foreign qualification.
 2        (a)  Before  transacting  or   continuing   to   transact
 3    business   in   this   State,  a  foreign  limited  liability
 4    partnership must file  a  statement  of  qualification  or  a
 5    renewal statement under Section 1001; provided, however, that
 6    the statement must contain:
 7             (1)  the  name  of  the  foreign  limited  liability
 8        partnership which satisfies the requirements of the state
 9        or  other  jurisdiction  under whose law it is formed and
10        ends with  "Registered  Limited  Liability  Partnership",
11        "Limited  Liability  Partnership",  "R.L.L.P.", "L.L.P.",
12        "RLLP", or "LLP";
13             (2)  the street address of the  partnership's  chief
14        executive office and, if different, the street address of
15        an office of the partnership in this State, if any;
16             (3)  the    name   and   street   address   of   the
17        partnership's agent for service of process;
18             (4)  a brief statement of the business in which  the
19        partnership engages;
20             (5)  a deferred effective date, if any; and
21             (6)  a  document  or  documents sufficient under the
22        laws of the state or jurisdiction in  which  the  limited
23        liability partnership is organized to constitute official
24        certification  of  current  status  in good standing as a
25        registered limited liability partnership under  the  laws
26        of that state or jurisdiction.
27        (b)  A  foreign  partnership  may  not  use an assumed or
28    fictitious  name  in  the  conduct   of   its   business   to
29    intentionally  misrepresent the geographic origin or location
30    of the partnership. This subsection (b) does not apply to any
31    foreign limited liability partnership that has  gross  annual
32    revenues in excess of $100,000,000.
33        (c)  A  person  shall not advertise or cause to be listed
34    in a telephone directory an assumed  or  fictitious  business
 
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 1    name  that  intentionally misrepresents where the business is
 2    actually located or operating  or  falsely  states  that  the
 3    business  is  located or operating in the area covered by the
 4    telephone directory. This subsection (c) does not apply to  a
 5    telephone service provider or to the publisher or distributor
 6    of   a   telephone  service  directory,  unless  the  conduct
 7    prescribed in this  subsection  (c)  is  on  behalf  of  that
 8    telephone  service provider or that publisher or distributor.
 9    This subsection (c) does not apply  to  any  foreign  limited
10    liability  partnership  that  has  gross  annual  revenues in
11    excess of $100,000,000.
12        (d)  A  foreign  limited   liability   partnership   that
13    violates  this  Section is guilty of a petty offense and must
14    be fined not less than $501  and  not  more  than  $1,000.  A
15    foreign   limited  liability  partnership  is  guilty  of  an
16    additional offense for each additional day  in  violation  of
17    this Section.
18        (e)  The agent of a foreign limited liability partnership
19    for  service  of  process  must  be  an  individual  who is a
20    resident of this State  or  other  person  authorized  to  do
21    business in this State.
22        (f)  The  status  of  a  partnership as a foreign limited
23    liability partnership is effective on the later of the filing
24    of the statement of foreign qualification or a date specified
25    in the statement. The status remains effective, regardless of
26    changes  in   the   partnership,   unless   the   partnership
27    voluntarily withdraws by filing a statement of withdrawal, in
28    which  event  the  status  of  the  partnership  as a foreign
29    limited liability partnership shall  terminate  on  the  date
30    such statement is filed or, if later, a date specified on the
31    statement.
32        (g)  An  amendment  or  cancellation  of  a  statement of
33    foreign qualification is effective when it is filed or  on  a
34    deferred   effective  date  specified  in  the  amendment  or
 
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 1    cancellation.
 2        (h)  The Secretary of State shall register as  a  limited
 3    liability   partnership   any   foreign   limited   liability
 4    partnership  that  submits  a  completed application with the
 5    required fee.

 6        Section 1103. Effect of failure to qualify.
 7        (a)  A foreign limited liability partnership  transacting
 8    business  in  this  State  may  not  maintain  an  action  or
 9    proceeding  in this State unless it has in effect a statement
10    of foreign qualification.
11        (b)  The  failure  of   a   foreign   limited   liability
12    partnership   to  have  in  effect  a  statement  of  foreign
13    qualification does not impair the validity of a  contract  or
14    act  of the foreign limited liability partnership or preclude
15    it from defending an action or proceeding in this State.
16        (c)  A limitation on personal liability of a  partner  is
17    not  waived  solely  by  transacting  business  in this State
18    without a statement of foreign qualification.
19        (d)  If a foreign limited liability partnership transacts
20    business  in  this  State  without  a  statement  of  foreign
21    qualification, the  Secretary  of  State  is  its  agent  for
22    service  of process with respect to a right of action arising
23    out of the transaction of business in this State.

24        Section 1104.  Activities  not  constituting  transacting
25    business.
26        (a)  Activities    of   a   foreign   limited   liability
27    partnership which do not constitute transacting business  for
28    the purpose of this Article include:
29             (1)  maintaining,  defending,  or settling an action
30        or proceeding;
31             (2)  holding meetings of its partners or carrying on
32        any other activity concerning its internal affairs;
 
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 1             (3)  maintaining bank accounts;
 2             (4)  maintaining  offices  or   agencies   for   the
 3        transfer, exchange, and registration of the partnership's
 4        own  securities  or  maintaining trustees or depositories
 5        with respect to those securities;
 6             (5)  selling through independent contractors;
 7             (6)  soliciting or obtaining orders, whether by mail
 8        or through employees  or  agents  or  otherwise,  if  the
 9        orders  require acceptance outside this State before they
10        become contracts;
11             (7)  creating or  acquiring  indebtedness,  with  or
12        without   a  mortgage,  or  other  security  interest  in
13        property;
14             (8)  collecting debts or  foreclosing  mortgages  or
15        other  security interests in property securing the debts,
16        and holding,  protecting,  and  maintaining  property  so
17        acquired;
18             (9)  conducting  an  isolated  transaction  that  is
19        completed  within 30 days and is not one in the course of
20        similar transactions; and
21             (10)  transacting business in interstate commerce.
22        (b)  For purposes of this Article, the ownership in  this
23    State  of income-producing real property or tangible personal
24    property, other than property excluded under  subsection  (a)
25    of  this  Section,  constitutes  transacting business in this
26    State.
27        (c)  This Section  does  not  apply  in  determining  the
28    contacts  or  activities  that  may subject a foreign limited
29    liability partnership to service  of  process,  taxation,  or
30    regulation under any other law of this State.

31        Section  1105.  Action  by Attorney General. The Attorney
32    General may maintain an action to restrain a foreign  limited
33    liability partnership from transacting business in this State
 
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 1    in violation of this Article.

 2                             ARTICLE 12
 3                      MISCELLANEOUS PROVISIONS

 4        Section 1201. Uniformity of application and construction.
 5    This  Act  shall  be  applied and construed to effectuate its
 6    general purpose to make uniform the law with respect  to  the
 7    subject of this Act among States enacting it.

 8        Section  1202.  Short  title.  (See Section 100 for short
 9    title.)

10        Section 1203. Severability clause. If  any  provision  of
11    this  Act or its application to any person or circumstance is
12    held invalid, the invalidity does not affect other provisions
13    or applications of this Act which can be given effect without
14    the invalid provision or application, and  to  this  end  the
15    provisions of this Act are severable.

16        Section  1204.  Effective  date.  (See  Section  1299 for
17    effective date.)

18        Section 1205. Repealer. (See Section 1290 for repeals.)

19        Section 1206. Applicability.
20        (a)  Before January 1, 2008,  this  Act  governs  only  a
21    partnership formed:
22             (1)  on   or   after   January  1,  2003,  except  a
23        partnership  that  is  continuing  the  business   of   a
24        dissolved  partnership under Section 33 of the superseded
25        Uniform Partnership Act; and
26             (2)  before  January  1,  2003,  that   elects,   as
27        provided  by  subsection  (c)  of  this  Section,  to  be
 
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 1        governed by this Act.
 2        (b)  On  and  after January 1, 2008, this Act governs all
 3    partnerships.
 4        (c)  Before January 1, 2008,  a  partnership  voluntarily
 5    may   elect,  in  the  manner  provided  in  its  partnership
 6    agreement or by law for amending the  partnership  agreement,
 7    to  be  governed  by  this  Act.  The  provisions of this Act
 8    relating to the liability of the  partnership's  partners  to
 9    third  parties  apply to limit those partners' liability to a
10    third party who had done business with the partnership within
11    one year before the partnership's election to be governed  by
12    this  Act  only  if  the  third party knows or has received a
13    notification of the partnership's election to be governed  by
14    this Act.

15        Section 1207. Savings clause. This Act does not affect an
16    action  or  proceeding commenced or right accrued before this
17    Act takes effect.

18        Section 1290.  The Uniform Partnership Act is amended  by
19    adding Part VII as follows:

20        (805 ILCS 205/Part VII heading new)
21                  PART VII.  APPLICABILITY; REPEAL

22        (805 ILCS 205/90 new)
23        Sec. 90.  Applicability of Act.
24        (a)  Except  as  provided  in  subsection  (b),  this Act
25    governs a partnership formed before January  1,  2003.   This
26    Act  governs a partnership formed after December 31, 2002 and
27    before January 1, 2008 only if that partnership is continuing
28    the business of a dissolved partnership under Section 33.   A
29    partnership  may  not  be  formed  under this Act on or after
30    January 1, 2003 unless it is continuing  the  business  of  a
 
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 1    dissolved partnership under Section 33.
 2        (b)  A  partnership  formed  before  January  1, 2003 may
 3    voluntarily elect to be governed, before January 1, 2008,  by
 4    the  Uniform  Partnership  Act  (1997) as provided in Section
 5    1206 of that Act.

 6        (805 ILCS 205/95 new)
 7        Sec. 95.  Repeal.  This Act is  repealed  on  January  1,
 8    2008.

 9        Section  1295.  The  Revised  Uniform Limited Partnership
10    Act is amended by changing Sections 201 and 1204  and  adding
11    Section 805 as follows:

12        (805 ILCS 210/201) (from Ch. 106 1/2, par. 152-1)
13        Sec. 201.  Certificate of Limited Partnership.
14        (a)  In   order   to   form   a  limited  partnership,  a
15    certificate of limited partnership must be executed and filed
16    in the office of the Secretary of  State  in  Springfield  or
17    Chicago.   Certificates  may  be  filed  in  such  additional
18    offices  as  the  Secretary  of  State  may  designate.   The
19    certificate shall set forth:
20             (1)  the name of the limited partnership;
21             (2)  the  purposes  for  which  the  partnership  is
22        formed,  which  may  be  stated to be, or to include, the
23        transaction of any or all  lawful  businesses  for  which
24        limited partnerships may be formed under this Act;
25             (3)  the  address of the office at which the records
26        required to be maintained by Section 104 are kept and the
27        name of its registered  agent  and  the  address  of  its
28        registered  office  required  to be maintained by Section
29        103;
30             (4)  the name and business address of  each  general
31        partner;
 
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 1             (5)  the latest date, if any, upon which the limited
 2        partnership is to dissolve;
 3             (6)  any  other  matters  the  partners determine to
 4        include therein; and
 5             (7)  any other information the  Secretary  of  State
 6        shall by rule deem necessary to administer this Act.
 7        (b)  A  limited  partnership is formed at the time of the
 8    filing of the  certificate  of  limited  partnership  in  the
 9    office  of  the  Secretary of State or at any later time, not
10    more than 60 days subsequent to the filing of the certificate
11    of limited  partnership,  specified  in  the  certificate  of
12    limited  partnership  if,  in  either  case,  there  has been
13    substantial compliance with the requirements of this Section.
14        (c)  A limited partnership may be formed by converting  a
15    partnership  to  a limited partnership as provided in Section
16    902 of the Uniform Partnership Act (1997).
17    (Source: P.A. 92-33, eff. 7-1-01.)

18        (805 ILCS 210/805 new)
19        Sec.  805.  Conversion   to   partnership.    A   limited
20    partnership  may be converted to a partnership as provided in
21    Section 903 of the Uniform Partnership Act (1997).

22        (805 ILCS 210/1204) (from Ch. 106 1/2, par. 162-4)
23        Sec. 1204.  Rules for Cases Not Provided for in this Act.
24    Before January 1, 2008, in any case not provided for in  this
25    Act  the  provisions of the Uniform Partnership Act govern if
26    that Act is otherwise applicable as provided in Section 90 of
27    that Act.  After December 31, 2002, in any case not  provided
28    for  in  this  Act, the provisions of the Uniform Partnership
29    Act (1997) govern if that  Act  is  otherwise  applicable  as
30    provided in Section 1206 of that Act.
31    (Source: P.A. 84-1412.)
 
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 1        Section  1299.  Effective date.  This Act takes effect on
 2    January 1, 2003.

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