law22123

Chapter 123

2022 -- H 7753
Enacted 06/21/2022

A N A C T

RELATING TO CORPORATIONS, ASSOCIATIONS, AND PARTNERSHIPS -- UNIFORM PARTNERSHIP ACT

Introduced By: Representative Gregg Amore

Date Introduced: March 02, 2022

It is enacted by the General Assembly as follows:

SECTION 1. Sections 7-12-12, 7-12-13, 7-12-14, 7-12-15, 7-12-16, 7-12-17, 7-12-18, 7-

12-19, 7-12-20, 7-12-21, 7-12-22, 7-12-23, 7-12-24, 7-12-25, 7-12-26, 7-12-27, 7-12-28, 7-12-29,

7-12-30, 7-12-31, 7-12-32, 7-12-33, 7-12-34, 7-12-35, 7-12-36, 7-12-37, 7-12-38, 7-12-39, 7-12-

40, 7-12-41, 7-12-42, 7-12-43, 7-12-44, 7-12-45, 7-12-46, 7-12-47, 7-12-48, 7-12-49, 7-12-50, 7-

12-51, 7-12-52, 7-12-53, 7-12-54, 7-12-55, 7-12-56, 7-12-57, 7-12-58 and 7-12-59 of the General

Laws in Chapter 7-12 entitled "Partnerships" are hereby repealed:

7-12-12. Short title.

Sections 7-12-12 - - 7-12-55 may be cited as the "Uniform Partnership Act".

7-12-13. Definitions.

In §§ 7-12-12 - - 7-12-59:

(1) "Bankrupt" includes bankrupt under title 11 of the United States Code (Bankruptcy) or

insolvent under any state insolvent act.

(2) "Business" includes every trade, occupation, or profession.

(3) "Conveyance" includes every assignment, lease, mortgage, or encumbrance.

(4) "Court" includes every court and judge having jurisdiction in the case.

(5) "Foreign registered limited-liability partnership" means a registered limited-liability

partnership or a limited-liability partnership formed pursuant to an agreement governed by the laws

of another jurisdiction and registered under the laws of that jurisdiction.

(6) "Person" includes individuals, partnerships, corporations, and other associations.

(7) "Real property" includes land and any interest or estate in land.

(8) "Registered limited-liability partnership" means a partnership formed pursuant to an

agreement governed by the laws of this state, registered under § 7-12-56 and in compliance with §

7-12-58.

7-12-14. Interpretation of knowledge and notice.

(a) A person has "knowledge" of a fact within the meaning of §§ 7-12-12 - - 7-12-55 not

only when he or she has actual knowledge of it, but also when he or she has knowledge of any other

facts that in the circumstances show bad faith.

(b) A person has "notice" of a fact within the meaning of §§ 7-12-12 - - 7-12-55 when the

person who claims the benefit of the notice:

(1) States the fact to the person; or

(2) Delivers through the mail, or by other means of communication, a written statement of

the fact to the person or to a proper person at his or her place of business or residence.

7-12-15. Rules of construction.

(a) The rule that statutes in derogation of the common law are to be strictly construed has

no application to §§ 7-12-12 - - 7-12-55.

(b) The law of estoppel applies under §§ 7-12-12 - - 7-12-55.

(d) Sections 7-12-12 - - 7-12-55 shall be so interpreted and construed as to effect their

general purpose to make uniform the law of those states which enact them.

(e) Sections 7-12-12 - - 7-12-55 shall not be construed so as to impair the obligations of

any contract existing on October 1, 1957, nor to affect any action or proceedings or right accrued

before October 1, 1957.

7-12-16. Rules for cases not provided for.

In any case not provided for in §§ 7-12-12 - - 7-12-55, the rules of law and equity, including

the law merchant, govern.

7-12-17. Partnership defined.

(a) A partnership is an association of two (2) or more persons to carry on as co-owners a

business for profit, and includes a registered limited-liability partnership.

(b) Any association formed under any other statute of this state, or any statute adopted by

authority, other than the authority of the state, is not a partnership under §§ 7-12-12 - - 7-12-59,

unless the association would have been a partnership in this state prior to May 6, 1957; but §§ 7-

12-12 - - 7-12-59 apply to limited partnerships except insofar as the statutes relating to partnerships

are inconsistent with these provisions.

7-12-18. Rules for determining the existence of a partnership.

In determining whether a partnership exists, these rules apply:

(1) Except as provided by § 7-12-27, persons who are not partners as to each other are not

partners as to third persons.

(2) Joint tenancy, tenancy in common, tenancy by the entireties, joint property, common

property, or part ownership does not of itself establish a partnership, whether the co-owners do or

do not share any profits made by the use of the property.

(3) The sharing of gross returns does not of itself establish a partnership, whether or not

the persons sharing them have a joint or common right or interest in any property from which the

returns are derived.

(4) The receipt by a person of a share of the profits of a business is prima facie evidence

that he or she is a partner in the business, but no such inference is drawn if profits were received in

payment:

(i) As a debt by installments or otherwise;

(ii) As wages of an employee or rent to a landlord;

(iii) As an annuity to a widow or representative of a deceased partner;

(iv) As interest on a loan, though the amount of payment vary with the profits of the

business;

(v) As the consideration for the sale of a good will of a business or other property by

installments or otherwise.

7-12-19. Partnership property.

(a) All property originally brought into the partnership stock or subsequently acquired by

purchase or otherwise, on account of the partnership, is partnership property.

(b) Unless the contrary intention appears, property acquired with partnership funds is

partnership property.

can be conveyed only in the partnership name.

(d) A conveyance to a partnership in the partnership name, though without words of

inheritance, passes the entire estate of the grantor unless a contrary intent appears.

7-12-20. Partner agent of partnership as to partnership business.

(a) Every partner is an agent of the partnership for the purpose of its business, and the act

of every partner, including the execution in the partnership name of any instrument, for apparently

carrying on in the usual way the business of the partnership of which he or she is a member, binds

the partnership, unless the partner so acting has in fact no authority to act for the partnership in the

particular matter, and the person with whom he or she is dealing has knowledge of the fact that he

or she has no authority.

(b) An act of a partner that is not apparently for the carrying on of the business of the

partnership in the usual way does not bind the partnership unless authorized by the other partners.

one or more but less than all the partners have no authority to:

(1) Assign the partnership property in trust for creditors or on the assignee's promise to pay

the debts of the partnership;

(2) Dispose of the good will of the business;

(3) Do any other act that would make it impossible to carry on the ordinary business of a

partnership;

(4) Confess a judgment;

(5) Submit a partnership claim or liability to arbitration or reference.

(d) No act of a partner in contravention of a restriction on authority shall bind the

partnership to persons having knowledge of the restriction.

7-12-21. Conveyance of real property of the partnership.

(a) Where title to real property is in the partnership name, any partner may convey title to

the property by a conveyance executed in the partnership name; but the partnership may recover

the property unless the partner's act binds the partnership under the provisions of § 7-12-20(a), or

unless the property has been conveyed by the grantee or a person claiming through the grantee to

a holder for value without knowledge that the partner, in making the conveyance, has exceeded his

or her authority.

(b) Where title to real property is in the name of the partnership, a conveyance executed by

a partner, in his or her own name, passes the equitable interest of the partnership, provided the act

is one within the authority of the partner under the provisions of § 7-12-20(a).

the record does not disclose the right of the partnership, the partners in whose name the title stands

may convey title to the property, but the partnership may recover the property if the partners' act

does not bind the partnership under the provisions of § 7-12-20(a) unless the purchaser or his or

her assignee, is a holder for value, without knowledge.

(d) Where the title to real property is in the name of one or more or all of the partners, or

in a third person in trust for the partnership, a conveyance executed by a partner in the partnership

name, or in his or her own name, passes the equitable interest of the partnership, provided the act

is one within the authority of the partner under the provision of § 7-12-20(a).

(e) Where the title to real property is in the names of all the partners a conveyance executed

by all the partners passes all their rights in the property.

7-12-22. Partnership bound by admission of partner.

An admission or representation made by any partner concerning partnership affairs within

the scope of his or her authority as conferred by §§ 7-12-12 - - 7-12-55 is evidence against the

partnership.

7-12-23. Partnership charged with knowledge of or notice to partner.

Notice to any partner of any matter relating to partnership affairs, and the knowledge of

the partners acting in the particular matter, acquired while a partner or then present to his or her

mind, and the knowledge of any other partner who reasonably could and should have

communicated it to the acting partner, operate as notice to or knowledge of the partnership, except

in the case of a fraud on the partnership committed by or with the consent of that partner.

7-12-24. Partnership bound by partner's wrongful act.

Where, by any wrongful act or omission of any partner acting in the ordinary course of the

business of the partnership or with the authority of his or her copartners, loss or injury is caused to

any person, not being a partner in the partnership, or any penalty is incurred, the partnership is

liable for the loss, injury, or penalty to the same extent as the partner acting or omitting to act.

7-12-25. Partnership bound by partner's breach of trust.

The partnership is bound to make good the loss:

(1) Where one partner acting within the scope of his or her apparent authority receives

money or property of a third person and misapplies it; and

(2) Where the partnership in the course of its business receives money or property of a third

person and the money or property so received is misapplied by any partner while it is in the custody

of the partnership.

7-12-26. Nature of partner's liability.

(a) All partners are liable, except as provided in subsection (b):

(1) Jointly and severally for everything chargeable to the partnership under §§ 7-12-24 and

7-12-25.

(2) Jointly for all other debts and obligations of the partnership; but any partner may enter

into a separate obligation to perform a partnership contract.

(b) Subject to subsection (c), a partner in a registered limited-liability partnership is not

liable, directly or indirectly (including by way of indemnification, contribution, assessment or

otherwise), for debts, obligations, and liabilities of, or chargeable to, the partnership whether in

tort, contract, or otherwise, arising while the partnership is a registered limited-liability partnership.

liability partnership for his or her own negligence, wrongful acts or misconduct, or that of any

person under that partner's direct supervision and control other than in an administrative capacity.

(d) A partner in a registered limited-liability partnership is not a proper party in his or her

individual capacity to a proceeding by or against a registered limited-liability partnership, the object

of which is to recover damages or enforce the obligations of the registered limited-liability

partnership, unless the partner is personally liable under subsection (c).

(e) Notwithstanding any other provisions of this section, the personal liability of a partner

in a limited-liability partnership engaged in the rendering of professional services is not less than

or greater than the personal liability of a shareholder of a professional corporation organized under

chapter 5.1 of this title engaged in the rendering of the same professional services.

7-12-27. Partner by estoppel.

(a) When a person, by words spoken or written or by conduct, represents himself or herself,

or consents to another representing him or her to any one, as a partner in an existing partnership or

with one or more persons not actual partners, he or she is liable to any person to whom the

representation has been made, who has, on the faith of the representation, given credit to the actual

or apparent partnership, and if he or she has made a representation or consented to its being made

in a public manner, he or she is liable to the person, whether the representation has or has not been

made or communicated to the person giving credit by or with the knowledge of the apparent partner

making the representation or consenting to its being made.

(1) When a partnership liability results, he or she is liable as though he or she were an

actual member of the partnership.

(2) When no partnership liability results, he or she is liable jointly with the other persons,

if any, so consenting to the contract or representation as to incur liability, otherwise separately.

(b) When a person is represented to be a partner in an existing partnership, or with one or

more persons not actual partners, he or she is an agent of the persons consenting to the

representation to bind them to the same extent and in the same manner as though he or she were a

partner in fact, with respect to persons who rely on the representation. Where all the members of

the existing partnership consent to the representation, a partnership act or obligation results; but in

all other cases it is the joint act or obligation of the person acting and the persons consenting to the

representation.

7-12-28. Liability of incoming partner.

A person admitted as a partner into an existing partnership is liable for all the obligations

of the partnership arising before his or her admission as though he or she had been a partner when

the obligations were incurred, except that this liability is satisfied only out of partnership property.

7-12-29. Rules determining rights and duties of partners.

The rights and duties of the partners in relation to the partnership are determined, subject

to any agreement between them, by the following rules:

(1) Each partner is repaid his or her contributions, whether by way of capital or advances

to the partnership property, and shares equally in the profits and surplus remaining after all

liabilities, including those to partners, are satisfied; and except as provided in § 7-12-26(b), each

partner must contribute toward the losses, whether of capital or otherwise, sustained by the

partnership according to his or her share in the profits.

(2) The partnership must indemnify every partner in respect of payments made and

personal liabilities reasonably incurred by him or her in the ordinary and proper conduct of its

business, or for the preservation of its business or property.

(3) A partner, who in aid of the partnership makes any payment or advance beyond the

amount of capital that he or she agreed to contribute, is paid interest from the date of the payment

or advance.

(4) A partner receives interest on the capital contributed by him or her only from the date

when repayment should be made.

(5) All partners have equal rights in the management and conduct of the partnership

business.

(6) No partner is entitled to remuneration for acting in the partnership business, except that

a surviving partner is entitled to reasonable compensation for his or her services in winding up the

partnership affairs.

(7) No person can become a member of a partnership without the consent of all the partners.

(8) Any difference arising as to ordinary matters connected with the partnership business

may be decided by a majority of the partners; but no act in contravention of any agreement between

the partners may be done rightfully without the consent of all the partners.

7-12-30. Partnership books.

The partnership books are kept, subject to any agreement between the partners, at the

principal place of business of the partnership, and every partner shall at all times have access to

and may inspect and copy any of them.

7-12-31. Duty of partners to render information.

Partners shall render on demand true and full information of all things affecting the

partnership to any partner or the legal representative of any deceased partner or partner under legal

disability.

7-12-32. Partner accountable as a fiduciary.

(a) Every partner must account to the partnership for any benefit, and hold as trustee for it

any profits derived by him or her without the consent of the other partners from any transaction

connected with the formation, conduct, or liquidation of the partnership or from any use by him or

her of its property.

(b) This section applies also to the representatives of a deceased partner engaged in the

liquidation of the affairs of the partnership as the personal representatives of the last surviving

partner.

7-12-33. Right to an account.

Any partner has the right to a formal account as to partnership affairs:

(1) If he or she is wrongfully excluded from the partnership business or possession of its

property by his or her copartners.

(2) If the right exists under the terms of any agreement.

(3) As provided by § 7-12-32.

(4) Whenever other circumstances render it just and reasonable.

7-12-34. Continuation of partnership beyond fixed term.

(a) When a partnership for a fixed term or particular undertaking is continued after the

termination of the term or particular undertaking without any express agreement, the rights and

duties of the partners remain the same as they were at the termination, insofar as is consistent with

a partnership at will.

(b) A continuation of the business by the partners or those of them who habitually acted in

the partnership during the term, without any settlement or liquidation of the partnership affairs, is

prima facie evidence of a continuation of the partnership.

7-12-35. Extent of property rights of a partner.

The property rights of a partner are:

(1) His or her rights in specific partnership property;

(2) His or her interest in the partnership; and

(3) His or her rights to participate in the management.

7-12-36. Nature of a partner's right in specific partnership property.

(a) A partner is co-owner with his or her partners of specific partnership property holding

as a tenant in partnership.

(b) The incidents of this tenancy are such that:

(1) A partner, subject to the provisions of §§ 7-12-12 - - 7-12-55 and to any agreement

between the partners, has an equal right with his or her partners to possess specific partnership

property for partnership purposes; but he or she has no right to possess the property for any other

purpose without the consent of his or her partners.

(2) A partner's right in specific partnership property is not assignable, except in connection

with the assignment of rights of all the partners in the same property.

(3) A partner's right in specific partnership property is not subject to attachment or

execution, except on a claim against the partnership. When partnership property is attached for a

partnership debt, the partners, or any of them, or the representatives of a deceased partner, cannot

claim any right under the exemption laws.

(4) On the death of a partner, his or her right in specific partnership property vests in the

surviving partner or partners, except where the deceased was the last surviving partner, when his

or her right in the property vests in his or her legal representative. The surviving partner, or partners,

or the legal representative of the last surviving partner, has no right to possess the partnership

property for any but a partnership purpose.

(5) A partner's right in specific partnership property is not subject to dower, curtesy, or

allowances to widows, heirs, or next of kin.

7-12-37. Nature of partner's interest in the partnership.

A partner's interest in the partnership is his or her share of the profits and surplus, and his

or her share of the profits and surplus is personal property.

7-12-38. Assignment of partner's interest.

(a) A conveyance by a partner of his or her interest in the partnership does not of itself

dissolve the partnership, nor, as against the other partners in the absence of agreement, entitle the

assignee, during the continuance of the partnership, to interfere in the management or

administration of the partnership business or affairs, to require any information or account of

partnership transactions, or to inspect the partnership book. It merely entitles the assignee to

receive, in accordance with his or her contract, the profits to which the assigning partner would

otherwise be entitled.

(b) In case of a dissolution of the partnership, the assignee is entitled to receive his or her

assignor's interest and may require an account from the date only of the last account agreed to by

all the partners.

7-12-39. Partner's interest subject to charging order.

(a) On due application to the superior court by any judgment creditor of a partner, the court

may charge the interest of the debtor partner with payment of the unsatisfied amount of the

judgment debt with interest on it; and may then or later appoint a receiver of his or her share of the

profits, and of any other money due, or to fall due, to him or her in respect of the partnership, and

make all other orders, directions, accounts, and inquiries that the debtor partner might have made,

or that the circumstances of the case require.

(b) The interest charged may be redeemed at any time before foreclosure, or in case of a

sale being directed by the court, may be purchased without causing a dissolution:

(1) With separate property, by any one or more of the partners; or

(2) With partnership property, by any one or more of the partners with the consent of all

the partners whose interests are not so charged or sold.

the exemption laws, regarding his interest in the partnership.

7-12-40. Dissolution defined.

The dissolution of a partnership is the change in the relation of the partners caused by any

partner ceasing to be associated in the carrying on as distinguished from the winding up of the

business.

7-12-41. Partnership not terminated by dissolution.

On dissolution the partnership is not terminated, but continues until the winding up of

partnership affairs is completed.

7-12-42. Causes of dissolution.

Dissolution is caused:

(1) Without violation of the agreement between the partners:

(i) By the termination of the definite term or particular undertaking specified in the

agreement;

(ii) By the express will of any partner when no definite term or particular undertaking is

specified;

(iii) By the express will of all the partners who have not assigned their interests or suffered

them to be charged for their separate debts, either before or after the termination of any specified

term or particular undertaking;

(iv) By the expulsion of any partner from the business bona fide in accordance with the

power conferred by the agreement between the partners;

(2) In contravention of the agreement between the partners, where the circumstances do

not permit a dissolution under any other provision of this section, by the express will of any partner

at any time;

(3) By any event that makes it unlawful for the business of the partnership to be carried on

or for the members to carry it on in partnership;

(4) By the death of any partner;

(5) By the bankruptcy of any partner or the partnership;

(6) By decree of court under § 7-12-43.

7-12-43. Dissolution by decree of court.

(a) On application by or for a partner, the court shall decree a dissolution whenever:

(1) A partner has been declared mentally incompetent in any judicial proceeding or is

shown to be of unsound mind;

(2) A partner becomes in any other way incapable of performing his or her part of the

partnership contract;

(3) A partner has been guilty of any conduct that tends to affect prejudicially the carrying

on of the business;

(4) A partner willfully or persistently commits a breach of the partnership agreement, or

otherwise so conducts him or herself in matters relating to the partnership business that it is not

reasonably practicable to carry on the business in partnership with him or her;

(5) The business of the partnership can only be carried on at a loss;

(6) Other circumstances render a dissolution equitable.

(b) On the application of the purchaser of a partner's interest under §§ 7-12-38 and 7-12-

39, the court shall decree a dissolution:

(1) After the termination of the specified term or particular undertaking;

(2) At any time if the partnership was a partnership at will when the interest was assigned

or when the charging order was issued.

7-12-44. General effect of dissolution on authority of partner.

Except insofar as is necessary to wind up partnership affairs or to complete transactions

begun but not then finished, dissolution terminates all authority of any partner to act for the

partnership:

(1) Regarding the partners:

(i) When the dissolution is not by the act, bankruptcy, or death of a partner; or

(ii) When the dissolution is by the act, bankruptcy, or death of a partner, in cases where §

7-12-45 so requires.

(2) With respect to persons not partners, as declared in § 7-12-46.

7-12-45. Right of partner to contribution from copartners after dissolution.

Where the dissolution is caused by the act, death, or bankruptcy of a partner, each partner

is liable to his or her copartners for his or her share of any liability created by any partner acting

for the partnership as if the partnership had not been dissolved, unless:

(1) The dissolution being by act of any partner, the partner acting for the partnership had

knowledge of the dissolution;

(2) The dissolution being by the death or bankruptcy of a partner, the partner acting for the

partnership had knowledge or notice of the death or bankruptcy; or

(3) The liability is for a debt or obligation for which the partner is not liable as provided in

§ 7-12-26(b).

7-12-46. Power of partner to bind partnership to third persons after dissolution.

(a) After dissolution, a partner can bind the partnership except as provided in subsection

(1) Any act appropriate for winding up partnership affairs or completing transactions

unfinished at dissolution;

(2) Any transaction that would bind the partnership if dissolution had not taken place,

provided the other party to the transaction:

(i) Had extended credit to the partnership prior to dissolution and had no knowledge or

notice of the dissolution; or

(ii) Though he or she had not so extended credit, had nevertheless known of the partnership

prior to dissolution, and, having no knowledge or notice of dissolution, the fact of dissolution had

not been advertised in a newspaper of general circulation in the place (or in each place if more than

one) at which the partnership business was regularly carried on.

(b) The liability of a partner under subsection (a)(2) shall be satisfied out of partnership

assets alone, when the partner had been, prior to dissolution:

(1) Unknown as a partner to the person with whom the contract is made; and

(2) So far unknown and inactive in partnership affairs that the business reputation of the

partnership could not be said to have been in any degree due to his or her connection with it.

(1) The partnership is dissolved because it is unlawful to carry on the business, unless the

act is appropriate for winding up partnership affairs;

(2) The partner has become bankrupt; or

(3) The partner has no authority to wind up partnership affairs, except by a transaction with

one who:

(i) Had extended credit to the partnership prior to dissolution and had no knowledge or

notice of his or her want of authority; or

(ii) Had not extended credit to the partnership prior to dissolution, and, having no

knowledge or notice of his or her want of authority, the fact of his or her want of authority has not

been advertised in the manner provided for advertising the fact of dissolution in subsection

(a)(2)(ii).

(d) Nothing in this section affects the liability under § 7-12-27 of any person who after

dissolution represents him or herself or consents to another representing him or her as a partner in

a partnership engaged in carrying on business.

7-12-47. Effect of dissolution on partner's existing liability.

(a) The dissolution of the partnership does not of itself discharge the existing liability of

any partner.

(b) A partner is discharged from any existing liability upon dissolution of the partnership

by an agreement to that effect between himself or herself, the partnership creditor, and the person

or partnership continuing the business. An agreement may be inferred from the course of dealing

between the creditor having knowledge of the dissolution and the person or partnership continuing

the business.

the partners whose obligations have been assumed are discharged from any liability to any creditor

of the partnership who, knowing of the agreement, consents to a material alteration in the nature or

time of payment of the obligations.

(d) The individual property of a deceased partner is liable for those obligations of the

partnership incurred while he or she was a partner and for which he or she is liable under § 7-12-

26, but subject to the prior payment of his or her separate debts.

7-12-48. Right to wind up.

Unless otherwise agreed, the partners who have not wrongfully dissolved the partnership

or the legal representative of the last surviving partner, not bankrupt, has the right to wind up the

partnership affairs; provided, that any partner, his or her legal representative, or his or her assignee

may obtain winding up by the court upon cause shown.

7-12-49. Rights of partners to application of partnership property.

(a) When dissolution is caused in any way, except in contravention of the partnership

agreement, each partner, as against his or her copartners and all persons claiming through them in

respect of their interests in the partnership, unless otherwise agreed, may have the partnership

property applied to discharge its liabilities, and the surplus applied to pay in cash the net amount

owing to the respective partners. But if dissolution is caused by the expulsion of a bona fide partner

under the partnership agreement, and if the expelled partner is discharged from all partnership

liabilities, either by payment or agreement under § 7-12-47(b), he or she receives in cash only the

net amount due him or her from the partnership.

(b) When dissolution is caused in contravention of the partnership agreement, the rights of

the partners are as follows:

(1) Each partner who has not wrongfully caused dissolution has:

(i) All the rights specified in subsection (a); and

(ii) The right, as against each partner who has wrongfully caused the dissolution, to

damages for breach of the agreement.

(2) The partners who have not wrongfully caused the dissolution, if they all desire to

continue the business in the same name, either by themselves or jointly with others, may do so

during the agreed term for the partnership and for that purpose may possess the partnership

property, provided they secure the payment by bond approved by the court, or pay to any partner

who has wrongfully caused the dissolution, the value of his or her interest in the partnership at the

dissolution, less any damages recoverable under subsection (b)(1)(ii), and in like manner indemnify

him or her against all present or future partnership liabilities.

(3) A partner who has wrongfully caused the dissolution has:

(i) If the business is not continued under the provisions of subsection (b)(2), all the rights

of a partner under subsection (a), subject to subsection (b)(1)(ii);

(ii) If the business is continued under subsection (b)(2), the right as against his or her

copartners, and all claiming through them as to their interests in the partnership, to have the value

of his or her interest in the partnership, less any damages caused to his or her copartners by the

dissolution, ascertained and paid to him or her in cash, or the payment secured by bond approved

by the court, and to be released from all existing liabilities of the partnership; but in ascertaining

the value of the partner's interest, the value of the good will of the business is not considered.

7-12-50. Rights where partnership is dissolved for fraud or misrepresentation.

Where a partnership contract is rescinded on the ground of the fraud or misrepresentation

of one of the parties to the contract, the party entitled to rescind is, without prejudice to any other

right, entitled to:

(1) A lien on, or right of retention of, the surplus of the partnership property, after satisfying

the partnership liabilities to third persons, for any sum of money paid by him or her for the purchase

of an interest in the partnership and for any capital or advances contributed by him; and

(2) Stand, after all liabilities to third persons have been satisfied, in the place of the creditors

of the partnership for any payments made by him or her as to the partnership liabilities; and

(3) Indemnification by the person guilty of the fraud or making the representation against

all debts and liabilities of the partnership.

7-12-51. Rules for distribution.

In settling accounts between the partners after dissolution, the following rules are observed,

subject to any agreement to the contrary:

(1) The assets of the partnership are:

(i) The partnership property;

(ii) The contributions of the partners specified in subdivision (4).

(2) The liabilities of the partnership rank in order of payment, as follows:

(i) Those owing to creditors other than partners;

(ii) Those owing to partners other than for capital and profits;

(iii) Those owing to partners in respect of capital;

(iv) Those owing to partners in respect of profits.

(3) The assets are applied in the order of their declaration in subdivision (1) to the

satisfaction of the liabilities.

(4) Except as provided in § 7-12-26(b), the partners shall contribute, as provided by § 7-

12-29(1), the amount necessary to satisfy the liabilities; but if any, but not all, of the partners are

insolvent, or not being subject to process, refuse to contribute, the other partners shall contribute

their share of the liabilities, and, in the relative proportions in which they share the profits, the

additional amount necessary to pay the liabilities.

(5) An assignee for the benefit of creditors of any person appointed by the court has the

right to enforce the contributions specified in subdivision (4).

(6) Any partner, or his or her legal representative, has the right to enforce the contributions

specified in subdivision (4), to the extent of the amount that he or she has paid in excess of his or

her share.

(7) The individual property of a deceased partner is liable for the contributions specified in

subdivision (4).

(8) When partnership property and the individual properties of the partners are in

possession of a court for distribution, partnership creditors have priority on partnership property

and separate creditors on individual property, saving the rights of lien or secured creditors as

previously.

(9) Where a partner has become bankrupt, or his or her estate is insolvent, the claims against

his or her separate property rank in the following order:

(i) Those owing to separate creditors;

(ii) Those owing to partnership creditors;

(iii) Those owing to partners by way of contribution.

7-12-52. Liability of persons continuing the business in certain cases.

(a) When any new partner is admitted into an existing partnership, or when any partner

retires and assigns (or the representative of the deceased partner assigns) his or her rights in

partnership property to two (2) or more of the partners, or to one or more of the partners, and one

or more third persons, if the business is continued without liquidation of the partnership affairs,

creditors of the first or dissolved partnership are also creditors of the partnership continuing the

business.

(b) When all but one partner retire and assign (or the representative of the deceased partner

assigns) their rights in partnership property to the remaining partner, who continues the business

without liquidation of partnership affairs, either alone or with others, creditors of the dissolved

partnership are also creditors of the person or partnership continuing the business.

continued as described in subsections (a) and (b), with the consent of the retired partners or the

representative of the deceased partner, but without any assignment of his or her right in partnership

property, rights of creditors of the dissolved partnership and of the creditors of the person or

partnership continuing the business are as if the assignment had been made.

(d) When all the partners or their representatives assign their rights in partnership property

to one or more third persons who promise to pay the debts and who continue the business of the

dissolved partnerships, creditors of the dissolved partnerships are also creditors of the person or

partnership continuing the business.

(e) When any partner wrongfully causes a dissolution and the remaining partners continue

the business under the provision of § 7-12-49(b)(2), either alone or with others, and without

liquidation of the partnership affairs, creditors of the dissolved partnership are also creditors of the

person or partnership continuing the business.

(f) When a partner is expelled and the remaining partners continue the business either alone

or with others, without liquidation of the partnership affairs, creditors of the dissolved partnership

are also creditors of the person or partnership continuing the business.

(g) The liability of a third person becoming a partner in the partnership continuing the

business, under this section, to the creditors of the dissolved partnership is satisfied out of

partnership property only.

(h) When the business of a partnership after dissolution is continued under any conditions

described in this section, the creditors of the dissolved partnership, as against the separate creditors

of the retiring or deceased partner or the representative of the deceased partner, have a prior right

to any claim of the retired partner or the representative of the deceased partner against the person

or partnership continuing the business, on account of the retired or deceased partner's interest in the

dissolved partnership or on account of any consideration promised for the interest or for his or her

right in partnership property.

(i) Nothing in this section can be held to modify any right of creditors to set aside any

assignment on the ground of fraud.

(j) The use by the person or partnership continuing the business of the partnership name,

or the name of a deceased partner as part of it, does not of itself make the individual property of

the deceased partner liable for any debts contracted by the person or partnership.

7-12-53. Rights of retiring or estate of deceased partner when the business is

continued.

When any partner retires or dies, and the business is continued under any of the conditions

described in subsection (a), (b), (c), (e) or (f) of § 7-12-52, or § 7-12-49(b)(2), without any

settlement of accounts as between him or her or his or her estate and the person or partnership

continuing the business, unless otherwise agreed, he or she or his or her legal representative as

against the persons or partnership may have the value of his or her interest at the date of dissolution

ascertained, and shall receive as an ordinary creditor an amount equal to the value of his or her

interest in the dissolved partnership with interest, or, at his or her option or at the option of his or

her legal representative, in lieu of interest, the profits attributable to the use of his or her right in

the property of the dissolved partnership; provided, that the creditors of the dissolved partnership

as against the separate creditors, or the representative of the retired or deceased partner, have

priority on any claim arising under this section as provided by § 7-12-52(h).

7-12-54. Accrual of actions.

The right to an account of his or her interest accrues to any partner, or his or her legal

representative, as against the winding up partners or the surviving partners or the person or

partnership continuing the business, at the date of dissolution, in the absence of any agreement to

the contrary.

7-12-55. Other laws preserved.

Nothing contained in §§ 7-12-12 - - 7-12-55 affects the provisions of §§ 7-12-1 - - 7-12-11

or of chapter 13 of this title.

7-12-56. Registered limited-liability partnerships.

(a) To become, and to continue as, a registered limited-liability partnership, a partnership

shall file with the secretary of state an application, or a renewal application, stating the name of the

partnership, the address of its principal office, if the partnership's principal office is not located in

this state, the address of a registered office and the name and address of a registered agent for

service of process in this state that a partnership is required to maintain. In addition, partnerships

under this section shall provide the names and addresses of all resident partners, the place where

the business records of the partnership are maintained, or if more than one location for business

records is maintained, then the principal place of business of the partnership, number, a brief

statement of the business in which the partnership engaged, and that the partnership applies for

status, or renewal of its status, as a registered limited-liability partnership.

(b) The application or renewal application shall be executed by a majority in interest of the

partners or by one or more partners authorized to execute an application or renewal application.

each partnership's initial filing.

Renewal applications are to be filed yearly and are to be accompanied by a fee of fifty

dollars ($50.00).

(d) The secretary of state shall register as a registered limited-liability partnership, and shall

renew the registration of any limited-liability partnership, any partnership that submits a completed

application or renewal application with the required fee.

(e) Registration is effective for one year after the date an application is filed, unless

voluntarily withdrawn by filing with the secretary of state a written withdrawal notice executed by

a majority in interest of the partners or by one or more partners authorized to execute a withdrawal.

Registration, whether pursuant to an original application or a renewal application, as a registered

limited-liability partnership is renewed if, during the sixty-day (60) period preceding the date the

application or renewal application otherwise would have expired, the partnership filed with the

secretary of state a renewal application. A renewal application expires one year after the date an

original application would have expired if the last renewal of the application had not occurred.

(f) The status of a partnership as a registered limited-liability partnership is not affected by

changes after the filing of an application or a renewal application in the information stated in the

application or renewal application.

(g) The secretary of state may provide forms for application for, or renewal of, registration.

Any renewals shall maintain resident partners as set out in this section.

(h) A partnership that registers as a registered limited-liability partnership is not deemed to

have dissolved as a result of that registration and is for all purposes the same partnership that existed

before the registration and continues to be a partnership under the laws of this state. If a registered

limited-liability partnership dissolves, a partnership that is a successor to the registered limited-

liability partnership and that intends to be a registered limited-liability partnership is not required

to file a new application and is deemed to have filed any documents required or permitted under

this chapter that were filed by the predecessor partnership.

(i) The fact that an application or renewal application is on file in the office of the secretary

of state is notice that the partnership is a registered limited-liability partnership and is notice of all

other facts stated in the application or renewal application.

7-12-57. Name of registered limited-liability partnerships.

(a) The name of a registered limited-liability partnership contains the words "registered

limited-liability partnership" or the abbreviation "L.L.P" or "LLP" as the last words or letters of its

name.

(b) The name shall be distinguishable upon the records of the secretary of state from the

name of any domestic for-profit or nonprofit corporation, or any domestic limited partnership, or

any domestic limited-liability company or any registered limited-liability partnership existing

under the laws of the state, or the name of any foreign for-profit or nonprofit corporation, or foreign

limited partnership, or foreign limited-liability company, or foreign registered limited-liability

partnership authorized to transact business in this state, or a name the exclusive right to which is,

at the time filed, reserved or registered in the manner provided under this title, subject to the

following:

(1) This provision does not apply if the applicant files with the secretary of state a certified

copy of a final decree of a court of competent jurisdiction establishing the prior right of the

applicant to the use of the name in this state; and

(2) The name may be the same as the name of a corporation, or limited-liability company,

or registered limited-liability partnership, the certificate of incorporation, authority, organization,

or registration of which has been revoked by the secretary of state as permitted by law and the

revocation has not been withdrawn within one year from the date of the revocation.

(3) Words and/or abbreviations that are required by statute to identify the particular type

of business entity shall be disregarded when determining if a name is distinguishable upon the

records of the secretary of state.

(4) The secretary of state shall promulgate rules and regulations defining the term

"distinguishable upon the record" for the administration of this chapter.

7-12-58. Insurance or financial responsibility of registered limited-liability

partnerships.

(a) A registered limited-liability partnership that is to perform professional services as

defined in § 7-5.1-2 shall carry, if reasonably available, liability insurance of a kind that is designed

to cover the kinds of negligence, wrongful acts, or misconduct for which liability is limited by § 7-

12-26(b). The insurance shall be in the aggregate amount of fifty thousand dollars ($50,000)

multiplied by the number of professional employees of the registered limited-liability partnership

as of the policy anniversary date; provided, that in no case shall the coverage be less than one

hundred thousand dollars ($100,000) but in no event shall the necessary coverage exceed a

maximum of five hundred thousand dollars ($500,000); provided, further, that any policy for

insurance coverage may include a deductible provision in any amount not to exceed twenty-five

thousand dollars ($25,000) for each claim multiplied by the number of professional employees of

the limited-liability partnership as of the date of the issuance of the policy. The policy or policies

of insurance may be subject to any terms, conditions, exclusions and endorsements that are

typically contained in policies of this type.

(b) If, in any proceeding, compliance by a partnership with the requirements of subsection

(a) is disputed:

(1) That issue is determined by the court, and

(2) The burden of proof of compliance is on the person who claims the limitation of liability

in § 7-12-26(b).

subsection (a), the requirements of this section shall not be admissible or in any way be made

known to a jury in determining an issue of liability for or extent of the debt or obligation or damages

in question.

(d) Insurance is reasonably available for the purpose of subsection (a) if, at the time that

the coverage would apply to the negligence, wrongful acts, or misconduct in question, it was

reasonably available to similar types of partnerships through the admitted or eligible surplus lines

market.

(e) A registered limited-liability partnership is considered to be in compliance with

subsection (a) if the partnership provides five hundred thousand dollars ($500,000) of funds

specifically designated and segregated for the satisfaction of judgments against the partnership

based on the forms of negligence, wrongful acts, and misconduct for which liability is limited by §

7-12-26(b) by:

(1) Deposit in trust or in bank escrow of cash, bank certificates of deposit, or United States

Treasury obligations; or

(2) A bank letter of credit or insurance company bonds.

(f) To the extent that a partnership maintains liability insurance or segregated funds

pursuant to the laws or regulations of another jurisdiction, the liability insurance or segregated

funds are deemed to satisfy this section if the amount hereof is equal to or greater than the amount

specified in subsection (a) or (e).

7-12-59. Applicability to foreign and interstate commerce.

(a) A partnership, including a registered limited-liability partnership, formed and existing

pursuant to an agreement governed by this chapter, may conduct its business, carry on its operations

and have and exercise the powers granted by this chapter in any state, territory, district or possession

of the United States, or in any foreign country.

(b) It is the intent of the general assembly that the legal existence of partnerships, including

registered limited-liability partnerships, formed in this state are recognized outside the boundaries

of this state and that, subject to any reasonable requirement of registration, a partnership, including

a registered limited-liability partnership, formed pursuant to an agreement governed by this chapter

and transacting business outside this state is granted the protection of full faith and credit under the

Constitution of the United States.

partnerships, formed and existing pursuant to an agreement governed by this chapter for the debts

and obligations of the partnership, is at all times determined exclusively by the laws of this state.

(d) Before transacting business in this state, a foreign registered limited-liability

partnership shall comply with any statutory or administrative registration or filing requirements

governing the specific type of business in which the partnership is engaged, and file a notice with

the secretary of state, on any forms that the Secretary provides, stating:

(1) The name of the partnership;

(2) The jurisdiction, the laws of which govern its partnership agreement and under which

it is registered as a limited-liability partnership;

(3) The address of its principal office;

(4) If the partnership's principal office is not located in this state;

(5) The address of a registered office and the name and address of a registered agent for

service of process in this state that the partnership shall be required to maintain;

(6) The names and addresses of all resident partners in this state;

(7) A brief statement of the business in which the partnership engages;

(8) Any other information that the partnership determines to include;

(9) A statement that the partnership is a registered limited-liability partnership. The notice

shall be accompanied by a fee of one thousand dollars ($1,000). The notice is effective for two (2)

years from the date of filing, after which time the partnership shall file a new notice. The filing of

the notice with the secretary of state makes it unnecessary to file any other documents under §§ 6-

1-1 - - 6-1-4.

(e) The name of a foreign registered limited-liability partnership doing business in this state

shall contain the words "Registered Limited-Liability Partnership" or "L.L.P." or "LLP", or any

other similar words or abbreviation as are required or authorized by the laws of the state where the

partnership is registered, as the last words or letters of its name.

(f) The internal affairs of foreign registered limited-liability partnerships, including the

liability of partners for debts, obligations, and liabilities of, or chargeable to, the partnership or

another partner or partners, are subject to and governed by the laws of the jurisdiction in which the

foreign registered limited-liability partnership is registered.

SECTION 2. Title 7 of the General Laws entitled "CORPORATIONS, ASSOCIATIONS,

AND PARTNERSHIPS" is hereby amended by adding thereto the following chapter:

CHAPTER 12.1

UNIFORM PARTNERSHIP ACT

ARTICLE 1

GENERAL PROVISIONS

7-12.1-101. Short title.

This chapter shall be known and may be cited as "The Uniform Partnership Act".

7-12.1-102. Definitions.

As used in this chapter:

(1) "Business" includes every trade, occupation, and profession.

(2) "Contribution", except in the phrase "right of contribution", means property or a benefit

described in § 7-12.1-403 which is provided by a person to a partnership to become a partner or in

the person's capacity as a partner.

(3) "Debtor in bankruptcy" means a person that is the subject of:

(i) An order for relief under Title 11 of the United States Code or a comparable order under

a successor statute of general application; or

(ii) A comparable order under federal, state, or foreign law governing insolvency.

(4) "Delivering/delivered" means either physically transferring a paper document to the

secretary of state or transferring a document to the secretary of state by electronic transmission

through a medium provided and authorized by the secretary of state.

(5) "Distribution" means a transfer of money or other property from a partnership to a

person on account of a transferable interest or in a person's capacity as a partner. The term:

(i) Includes:

(A) A redemption or other purchase by a partnership of a transferable interest; and

(B) A transfer to a partner in return for the partner's relinquishment of any right to

participate as a partner in the management or conduct of the partnership's business or have access

to records or other information concerning the partnership's business; and

(ii) Does not include amounts constituting reasonable compensation for present or past

service or payments made in the ordinary course of business under a bona fide retirement plan or

other bona fide benefits program.

(6) "Electronic transmission" means any form of communication, not directly involving

the physical transmission of paper, that creates a record that may be retained, retrieved, and

reviewed by a recipient thereof, and that may be directly reproduced in paper form by such a

recipient through an automated process.

(7) "Foreign limited-liability partnership" means a foreign partnership whose partners have

limited-liability for the debts, obligations, or other liabilities of the foreign partnership under a

provision similar to § 7-12.1-306(c).

(8) "Foreign partnership" means an unincorporated entity formed under the law of a

jurisdiction other than this state which would be a partnership if formed under the law of this state.

The term includes a foreign limited-liability partnership.

(9) "Jurisdiction", used to refer to a political entity, means the United States, a state, a

foreign country, or a political subdivision of a foreign country.

(10) "Jurisdiction of formation" means the jurisdiction whose law governs the internal

affairs of an entity.

(11) "Limited-liability partnership", except in the phrase "foreign limited-liability

partnership" and in Article 11 of this chapter, means a partnership that has filed a statement of

qualification under § 7-12.1-901 and does not have a similar statement in effect in any other

jurisdiction.

(12) "Partner" means a person that:

(i) Has become a partner in a partnership under § 7-12.1-402 or was a partner in a

partnership when the partnership became subject to this chapter under § 7-12.1-110; and

(ii) Has not dissociated as a partner under § 7-12.1-601.

(13) "Partnership", except in Article 11 of this chapter, means an association of two (2) or

more persons to carry on as co-owners of a business for profit formed under this chapter or that

becomes subject to this chapter under Article 11 of this chapter or § 7-12.1-110. The term includes

a limited-liability partnership.

(14) "Partnership agreement" means the agreement, whether or not referred to as a

partnership agreement and whether oral, implied, in a record, or in any combination thereof, of all

the partners of a partnership concerning the matters described in § 7-12.1-105. The term includes

the agreement as amended or restated.

(15) "Partnership at will" means a partnership in which the partners have not agreed to

remain partners until the expiration of a definite term or the completion of a particular undertaking.

(16) "Person" means an individual, business corporation, nonprofit corporation,

partnership, limited partnership, limited-liability company, general cooperative association, limited

cooperative association, unincorporated nonprofit association, statutory trust, business trust,

common-law business trust, estate, trust, association, joint venture, public corporation, government

or governmental subdivision, agency, or instrumentality, or any other legal or commercial entity.

(17) "Principal office" means the principal executive office of a partnership or a foreign

limited-liability partnership, whether or not the office is located in this state.

(18) "Property" means all property, whether real, personal, or mixed or tangible or

intangible, or any right or interest therein.

(19) "Record", used as a noun, means information that is inscribed on a tangible medium

or that is stored in an electronic or other medium and is retrievable in perceivable form.

(20) "Registered agent" means an agent of a limited-liability partnership or foreign limited-

liability partnership which is authorized to receive service of any process, notice, or demand

required or permitted by law to be served on the partnership.

(21) "Registered foreign limited-liability partnership" means a foreign limited-liability

partnership that is registered to do business in this state pursuant to a statement of registration filed

with the secretary of state.

(22) "Sign" means, with present intent to authenticate or adopt a record:

(i) To execute or adopt a tangible symbol; or

(ii) To attach to or logically associate with the record an electronic symbol, sound, or

process.

(23) "Signature" or "signed" or "executed" means an original signature, facsimile, or an

electronically transmitted signature submitted through a medium provided and authorized by the

secretary of state.

(24) "State" means a state of the United States, the District of Columbia, Puerto Rico, the

United States Virgin Islands, or any territory or insular possession subject to the jurisdiction of the

United States.

(25) "Transfer" includes:

(i) An assignment;

(ii) A conveyance;

(iii) A sale;

(iv) A lease;

(v) An encumbrance, including a mortgage or security interest;

(vi) A gift; and

(vii) A transfer by operation of law.

(26) "Transferable interest" means the right, as initially owned by a person in the person's

capacity as a partner, to receive distributions from a partnership, whether or not the person remains

a partner or continues to own any part of the right. The term applies to any fraction of the interest,

by whomever owned.

(27) "Transferee" means a person to which all or part of a transferable interest has been

transferred, whether or not the transferor is a partner.

7-12.1-103. Knowledge; Notice.

(a) A person knows a fact if the person:

(1) Has actual knowledge of it; or

(2) Is deemed to know it under subsection (d)(1) of this section or law other than this

chapter.

(b) A person has notice of a fact if the person:

(1) Has reason to know the fact from all the facts known to the person at the time in

question; or

(2) Is deemed to have notice of the fact under subsection (d)(2) of this section.

reasonably required to inform the other person in ordinary course, whether or not those steps cause

the other person to know the fact.

(d) A person not a partner is deemed:

(1) To know of a limitation on authority to transfer real property as provided in § 7-12.1-

303(g); and

(2) To have notice of:

(i) A person's dissociation as a partner ninety (90) days after a statement of dissociation

under § 7-12.1-704 becomes effective; and

(ii) A partnership's:

(A) Dissolution ninety (90) days after a statement of dissolution under § 7-12.1-802

becomes effective;

(B) Termination ninety (90) days after a statement of termination under § 7-12.1-802

becomes effective; and

days after articles of merger, interest exchange, conversion, or domestication under Article 11 of

this chapter become effective.

(e) A partner's knowledge or notice of a fact relating to the partnership is effective

immediately as knowledge of or notice to the partnership, except in the case of a fraud on the

partnership committed by or with the consent of that partner.

7-12.1-104. Governing law.

The internal affairs of a partnership and the liability of a partner as a partner for a debt,

obligation, or other liability of the partnership are governed by:

(1) In the case of a limited-liability partnership, the law of this state; and

(2) In the case of a partnership that is not a limited-liability partnership, the law of the

jurisdiction in which the partnership has its principal office.

7-12.1-105. Partnership agreement; Scope, Function, and Limitations.

(a) Except as otherwise provided in subsections (c) and (d) of this section, the partnership

agreement governs:

(1) Relations among the partners as partners and between the partners and the partnership;

(2) The business of the partnership and the conduct of that business; and

(3) The means and conditions for amending the partnership agreement.

(b) To the extent the partnership agreement does not provide for a matter described in

subsection (a) of this section, this chapter governs the matter.

(1) Vary the law applicable under § 7-12.1-104(1);

(2) Vary the provisions of § 7-12.1-110;

(3) Vary the provisions of § 7-12.1-307;

(4) Unreasonably restrict the duties and rights under § 7-12.1-408, but the partnership

agreement may impose reasonable restrictions on the availability and use of information obtained

under that section and may define appropriate remedies, including liquidated damages, for a breach

of any reasonable restriction on use;

(5) Alter or eliminate the duty of loyalty or the duty of care, except as otherwise provided

in subsection (d) of this section;

(6) Eliminate the contractual obligation of good faith and fair dealing under § 7-12.1-

409(d), but the partnership agreement may prescribe the standards, if not manifestly unreasonable,

by which the performance of the obligation is to be measured;

(7) Unreasonably restrict the right of a person to maintain an action under § 7-12.1-410(b);

(8) Relieve or exonerate a person from liability for conduct involving bad faith, willful or

intentional misconduct, or knowing violation of law;

(9) Vary the power of a person to dissociate as a partner under § 7-12.1-602(a), except to

require that the notice under § 7-12.1-601(1) to be in a record;

(10) Vary the grounds for expulsion specified in § 7-12.1-601(5);

(11) Vary the causes of dissolution specified in § 7-12.1-801(4) or (5);

(12) Vary the requirement to wind up the partnership's business as specified in § 7-12.1-

802(a), (b)(1), and (d);

(13) Vary the right of a partner under § 7-12.1-901(f) to vote on or consent to a cancellation

of a statement of qualification;

(14) Vary the right of a partner to approve a merger, interest exchange, conversion, or

domestication under §§ 7-12.1-11.23(a)(2), 7-12.1-11.33(a)(2), 7-12.1-11.43(a)(2), or 7-12.1-

11.53(a)(2);

(15) Vary the required contents of a plan of merger under § 7-12.1-11.22(a), plan of interest

exchange under § 7-12.1-11.32(a), plan of conversion under § 7-12.1-11.42(a), or plan of

domestication under § 7-12.1-11.52(a);

(16) Vary any requirement, procedure, or other provision of this chapter pertaining to:

(i) Registered agents; or

(ii) The secretary of state, including provisions pertaining to records authorized or required

to be filed with the secretary of state under this chapter; or

(17) Except as otherwise provided in §§ 7-12.1-106 and 7-12.1-107(b), restrict the rights

under this chapter of a person other than a partner.

(d) Subject to subsection (c)(8) of this section, without limiting other terms that may be

included in a partnership agreement, the following rules apply:

(1) The partnership agreement may:

(i) Specify the method by which a specific act or transaction that would otherwise violate

the duty of loyalty may be authorized or ratified by one or more disinterested and independent

persons after full disclosure of all material facts; and

(ii) Alter the prohibition in § 7-12.1-406(a)(2) to the extent the prohibition requires only

that the partnership's total assets not be less than the sum of its total liabilities.

(2) To the extent the partnership agreement expressly relieves a partner of a responsibility

that the partner would otherwise have under this chapter and imposes the responsibility on one or

more other partners, the agreement also may eliminate or limit any fiduciary duty of the partner

relieved of the responsibility which would have pertained to the responsibility.

(3) If not manifestly unreasonable, the partnership agreement may:

(i) Alter or eliminate the aspects of the duty of loyalty stated in § 7-12.1-409(b);

(ii) Identify specific types or categories of activities that do not violate the duty of loyalty;

(iii) Alter the duty of care, but may not authorize conduct involving bad faith, willful or

intentional misconduct, or knowing violation of law; and

(iv) Alter or eliminate any other fiduciary duty.

(e) The court shall decide as a matter of law whether a term of a partnership agreement is

manifestly unreasonable under subsection (c)(6) or (d)(3) of this section. The Providence County

superior court:

(1) Shall make its determination as of the time the challenged term became part of the

partnership agreement and by considering only circumstances existing at that time; and

(2) May invalidate the term only if, in light of the purposes and business of the partnership,

it is readily apparent that:

(i) The objective of the term is unreasonable; or

(ii) The term is an unreasonable means to achieve the term's objective.

7-12.1-106. Partnership agreement -- Effect on partnership and person becoming

partner -- Preformation agreement.

(a) A partnership is bound by and may enforce the partnership agreement, whether or not

the partnership has itself manifested assent to the agreement.

(b) A person that becomes a partner is deemed to assent to the partnership agreement.

make an agreement providing that upon the formation of the partnership the agreement will become

the partnership agreement.

7-12.1-107. Partnership agreement -- Effect on third parties and relationship to

records effective on behalf of partnership.

(a) A partnership agreement may specify that its amendment requires the approval of a

person that is not a party to the agreement or the satisfaction of a condition. An amendment is

ineffective if its adoption does not include the required approval or satisfy the specified condition.

(b) The obligations of a partnership and its partners to a person in the person's capacity as

a transferee or person dissociated as a partner are governed by the partnership agreement. Subject

only to a court order issued under § 7-12.1-504(b)(2) to effectuate a charging order, an amendment

to the partnership agreement made after a person becomes a transferee or is dissociated as a partner:

(1) Is effective with regard to any debt, obligation, or other liability of the partnership or

its partners to the person in the person's capacity as a transferee or person dissociated as a partner;

and

(2) Is not effective to the extent the amendment:

(i) Imposes a new debt, obligation, or other liability on the transferee or person dissociated

as a partner; or

(ii) Prejudices the rights under § 7-12.1-701 of a person that dissociated as a partner before

the amendment was made.

effective and contains a provision that would be ineffective under §§ 7-12.1-105(c) or 7-12.1-

105(d)(3) if contained in the partnership agreement, the provision is ineffective in the record.

(d) Subject to subsection (c) of this section, if a record delivered by a partnership to the

secretary of state for filing becomes effective and conflicts with a provision of the partnership

agreement:

(1) The agreement prevails as to partners, persons dissociated as partners, and transferees;

and

(2) The record prevails as to other persons to the extent they reasonably rely on the record.

7-12.1-108. Signing of records to be delivered for filing to secretary of state.

(a) A record filed with the secretary of state pursuant to this chapter must be signed as

follows:

(1) Except as otherwise provided in subsections (a)(2) and (a)(3) of this section, a record

signed by a partnership must be signed by a person authorized by the partnership.

(2) A record filed on behalf of a dissolved partnership that has no partner must be signed

by the person winding up the partnership's business under § 7-12.1-802(c) or a person appointed

under § 7-12.1-802(d) to wind up the business.

(3) A statement of denial by a person under § 7-12.1-304 must be signed by that person.

(4) Any other record delivered on behalf of a person to the secretary of state for filing must

be signed by that person.

(b) A record filed under this chapter may be signed by an agent. Whenever this chapter

requires a particular individual to sign a record and the individual is deceased or incompetent, the

record may be signed by a legal representative of the individual.

person is authorized to sign the record.

7-12.1-109. Liability for inaccurate information in filed record.

(a) If a record filed with the secretary of state under this chapter and filed by the secretary

of state contains inaccurate information, a person that suffers loss by reliance on the information

may recover damages for the loss from:

(1) A person that signed the record, or caused another to sign it on the person's behalf, and

knew the information to be inaccurate at the time the record was signed; and

(2) Subject to subsection (b) of this section, a partner if:

(i) The record was delivered for filing on behalf of the partnership; and

(ii) The partner knew or had notice of the inaccuracy for a reasonably sufficient time before

the information was relied upon so that, before the reliance, the partner reasonably could have:

(A) Effected an amendment under § 7-12.1-901(f);

(B) Filed a petition under § 7-12.1-112; or

of correction under § 7-12.1-116.

(b) To the extent the partnership agreement expressly relieves a partner of responsibility

for maintaining the accuracy of information contained in records delivered on behalf of the

partnership to the secretary of state for filing under this chapter and imposes that responsibility on

one or more other partners, the liability stated in subsection (a)(2) of this section applies to those

other partners and not to the partner that the partnership agreement relieves of the responsibility.

affirms under penalty of perjury that the information stated in the record is accurate.

7-12.1-110. Application to existing relationships.

(a) This chapter governs only:

(1) A partnership formed on or after January 1, 2023; and

(2) Except as otherwise provided in subsection (c) of this section, a partnership formed

before January 1, 2023, which elects, in the manner provided in its partnership agreement or by law

for amending the partnership agreement, to be subject to this chapter.

(b) Except as otherwise provided in subsection (c) of this section, on and after January 1,

2023, this chapter governs all partnerships.

be subject to this chapter, after the election takes effect the provisions of this chapter relating to the

liability of the partnership's partners to third parties apply to:

(1) A third party that had not done business with the partnership in the year before the

election took effect; and

(2) A third party that had done business with the partnership in the year before the election

took effect only if the third party knows or has been notified of the election.

7-12.1-110.1. Election of existing limited-liability partnerships.

(a) With respect to a limited-liability partnership that elects pursuant to §7-12.1-110 (a)(2)

to be subject to this chapter, the partnership must deliver to the secretary of state a statement

approved in the manner required by § 7-12.1-901(b). The statement must contain:

(1) The name of the limited-liability partnership;

(2) A statement that the partnership is a limited-liability partnership and elects to comply

with the provisions of chapter 12.1 of title 7;

(3) A statement that the partnership’s status as a limited-liability partnership is perpetual

and remains effective, regardless of changes to the partnership, until it is canceled or

administratively revoked pursuant to the provision provisions of chapter 12.1 of title 7;

(4) The name and street address in this state of the partnership’s registered agent.

(b) Prior to the effective date of this chapter outlined in § 7-12.1-110(b), a limited-liability

partnership may renew its registration pursuant to § 7-12-56(e). Upon the effective date of this

chapter, to maintain its status as a limited-liability partnership, the following actions must be taken:

(1) A designation of a registered agent must be recorded with the secretary of state; and

(2) At the time prescribed, the limited-liability partnership must file an annual report in

accordance with the provisions of § 7-12.1-913.

7-12.1-111. Delivery of record.

(a) Except as otherwise provided in this chapter, permissible means of delivery of a record

include delivery by hand, mail, conventional commercial practice, and electronic transmission.

(b) Delivery to the secretary of state is effective only when a record is received by the

secretary of state.

7-12.1-112. Signing and filing pursuant to judicial order.

(a) If a person required by this chapter to sign a record or deliver a record to the secretary

of state for filing under this chapter does not do so, any other person that is aggrieved may petition

the superior court to order:

(1) The person to sign the record;

(2) The person to deliver the record to the secretary of state for filing; or

(3) The secretary of state to file the record unsigned.

(b) If a petitioner under subsection (a) of this section is not the partnership or foreign

limited-liability partnership to which the record pertains, the petitioner shall make the partnership

or foreign partnership a party to the action.

7-12.1-113. Filing requirements.

(a) To be filed by the secretary of state pursuant to this chapter, a record must be received

by the secretary of state, comply with this chapter, and satisfy the following:

(1) The filing of the record must be required or permitted by this chapter;

(2) The record must be physically delivered in written form unless and to the extent the

secretary of state permits electronic delivery of records;

(3) The words in the record must be in English, and numbers must be in Arabic or Roman

numerals, but the name of an entity need not be in English if written in English letters or Arabic or

Roman numerals;

(4) The record must be signed by a person authorized or required under this chapter to sign

the record; and

(5) The record must state the name and capacity, if any, of each individual who signed it,

either on behalf of the individual or the person authorized or required to sign the record, but need

not contain a seal, attestation, acknowledgment, or verification.

(b) If any law other than this chapter prohibits the disclosure by the secretary of state of

information contained in a record filed with the secretary of state, the secretary of state shall file

the record if the record otherwise complies with this chapter but may redact the information.

and any fee, tax, interest, or penalty required to be paid under this chapter or law other than this

chapter must be paid in a manner permitted by the secretary of state or by that law.

(d) The secretary of state may require that a record delivered in written form be

accompanied by an identical or conformed copy.

(e) The secretary of state may provide forms for filings required or permitted to be made

by this chapter, but, except as otherwise provided in this section, their use is not required.

(f) The secretary of state may require that a cover sheet for a filing be on a form prescribed

by the secretary of state.

7-12.1-114. Effective date and time.

Except as otherwise provided in § 7-12.1-115 and subject to § 7-12.1-116(c), a record filed

under this chapter is effective:

(1) On the date and at the time of its filing by the secretary of state, as provided in § 7-

12.1-117(b);

(2) On the date of filing and at the time specified in the record as its effective time, if later

than the time under subsection (1) of this section;

(3) At a specified delayed effective date and time, which may not be more than ninety (90)

days after the date of filing; or

(4) If a delayed effective date is specified, but no time is specified, at one minute past

twelve am (12:01 a.m.) on the date specified, which may not be more than ninety (90) days after

the date of filing.

7-12.1-115. Withdrawal of filed record before effectiveness.

(a) Except as otherwise provided in §§ 7-12.1-11.24, 7-12.1-11.34, 7-12.1-11.44, and 7-

12.1-11.54, a record filed with the secretary of state may be withdrawn before it takes effect by

delivering to the secretary of state for filing a statement of withdrawal.

(b) A statement of withdrawal must:

(1) Be signed by each person that signed the record being withdrawn, except as otherwise

agreed by those persons;

(2) Identify the record to be withdrawn; and

(3) If signed by fewer than all the persons that signed the record being withdrawn, state

that the record is withdrawn in accordance with the agreement of all the persons that signed the

record.

evidenced by the original record does not take effect.

7-12.1-116. Correcting filed record.

(a) A person on whose behalf a filed record was filed with the secretary of state may correct

the record if:

(1) The record at the time of filing was inaccurate;

(2) The record was defectively signed; or

(3) The electronic transmission of the record to the secretary of state was defective.

(b) To correct a filed record, a person on whose behalf the record was delivered to the

secretary of state must deliver to the secretary of state for filing a statement of correction.

(1) May not state a delayed effective date;

(2) Must be signed by the person correcting the filed record;

(3) Must identify the filed record to be corrected;

(4) Must specify the inaccuracy or defect to be corrected; and

(5) Must correct the inaccuracy or defect.

(d) A statement of correction is effective as of the effective date of the filed record that it

corrects except for purposes of § 7-12.1-103(d) and as to persons relying on the uncorrected filed

record and adversely affected by the correction. For those purposes and as to those persons, the

statement of correction is effective when filed.

7-12.1-117. Duty of secretary of state to file -- Review of refusal to file -- Delivery of

record by secretary of state.

(a) The secretary of state shall file a record filed with the secretary of state which satisfies

this chapter. The duty of the secretary of state under this section is ministerial.

(b) When the secretary of state files a record, the secretary of state shall record it as filed

on the date and at the time of its delivery. After filing a record, the secretary of state shall deliver

to the person that submitted the record a copy of the record with an acknowledgment of the date

and time of filing and, in the case of a statement of denial, also to the partnership to which the

statement pertains.

ten (10) business days after the record is delivered:

(1) Return the record or notify the person that submitted the record of the refusal; and

(2) Provide a brief explanation in a record of the reason for the refusal.

(d) If the secretary of state refuses to file a record, the person that submitted the record may

petition the superior court to compel filing of the record. The record and the explanation of the

secretary of state of the refusal to file must be attached to the petition. The Providence County

superior court may decide the matter in a summary proceeding.

(e) The filing of or refusal to file a record does not:

(1) Affect the validity or invalidity of the record in whole or in part; or

(2) Create a presumption that the information contained in the record is correct or incorrect.

(f) Except as otherwise provided by § 7-12.1-909 or by law other than this chapter, the

secretary of state may deliver any record to a person by delivering it:

(1) In person to the person that submitted it;

(2) To the address of the person's registered agent;

(3) To the principal office of the person;

(4) To an electronic address the person provides to the secretary of state for delivery; or

(5) By providing, at no cost to the filer, access to a downloadable copy of the record from

the secretary of state’s online corporate database.

(g) Notwithstanding that any instrument authorized to be filed with the secretary of state

under this chapter is when filed inaccurately, defectively or erroneously executed, sealed or

acknowledged, or otherwise defective in any respect, the secretary of state has no liability to any

individual for the preclearance for filing, the acceptance for filing or the filing and indexing of such

instrument by the secretary of state.

7-12.1-117.1. Fees for filing documents and issuing certificates.

The secretary of state shall charge and collect for:

(1) Filing a statement of partnership authority, one hundred dollars ($100);

(2) Filing a statement of amendment or cancellation of partnership authority, fifty dollars

($50.00);

(3) Filing a statement of denial of partnership authority, fifty dollars ($50.00);

(4) Filing a statement of dissociation, ten dollars ($10.00);

(5) Filing an application to reserve a partnership name, fifty dollars ($50.00);

(6) Filing a notice of transfer of a reserved partnership name, fifty dollars ($50.00);

(7) Filing a statement of change of registered agent, twenty dollars ($20.00);

(8) Filing a statement of change of name or address only for a registered agent, without

fee;

(9) Filing a statement of qualification for a limited-liability partnership, one hundred fifty

dollars ($150)

(10) Filing a statement of amendment or cancellation of a limited-liability partnership, fifty

dollars ($50.00);

(11) Filing a fictitious business name statement for a limited-liability partnership, fifty

dollars ($50.00)

(12) Filing an application of registration for a foreign limited-liability partnership, one

hundred fifty dollars ($150);

(13) Filing an amendment to an application of registration for a foreign limited-liability

partnership, fifty dollars ($50.00)

(14) Filing a certificate of withdrawal of registration as a foreign limited-liability

partnership, fifty dollars ($50.00);

(15) Filing any other document, statement, or report of a domestic or foreign limited-

liability partnership, except an annual report, ten dollars ($10.00);

(16) An annual report of a domestic or foreign limited-liability partnership, fifty dollars

($50.00);

(17) To withdraw the certificate of revocation of a limited-liability partnership, whether

domestic or foreign, a penalty in the amount of fifty dollars ($50.00) for each year or part of the

year that has elapsed since the issuance of the certificate of revocation;

(18) For issuing a certificate of good standing/letter of status, twenty dollars ($20.00);

(19) For issuing a certificate of fact, thirty dollars ($30.00);

(20) For furnishing a certified copy of any document, instrument, or paper relating to a

partnership or limited-liability partnership, a fee of fifteen cents ($.15) per page and ten dollars

($10.00) for the certificate and affirming the seal to it;

(21) Service of process on the secretary of state as registered agent of a partnership or a

limited-liability partnership, fifteen dollars ($15.00) which amount may be recovered as a taxable

cost by the party to the suit or action making the service if the party prevails in the suit or action;

(22) Filing articles of merger for a partnership or limited-liability partnership, one hundred

dollars ($100); and

(23) Filing a statement of domestication for a limited-liability partnership, fifty dollars

($50.00).

7-12.1-118. Reservation of power to amend or repeal.

The general assembly has power to amend or repeal all or part of this chapter at any time,

and all limited-liability partnerships and foreign limited-liability partnerships subject to this chapter

shall be governed by the amendment or repeal.

7-12.1-119. Supplemental principles of law.

Unless displaced by particular provisions of this chapter, the principles of law and equity

supplement this chapter.

ARTICLE 2

NATURE OF PARTNERSHIP

7-12.1-201. Partnership as entity.

(a) A partnership is an entity distinct from its partners.

(b) A partnership is the same entity regardless of whether the partnership has a statement

of qualification in effect under § 7-12.1-901.

7-12.1-202. Formation of partnership.

(a) Except as otherwise provided in subsection (b) of this section, the association of two

(2) or more persons to carry on as co-owners a business for profit forms a partnership, whether or

not the persons intend to form a partnership.

(b) An association formed under a statute other than this chapter, a predecessor statute, or

a comparable statute of another jurisdiction is not a partnership under this chapter.

(1) Joint tenancy, tenancy in common, tenancy by the entireties, joint property, common

property, or part ownership does not by itself establish a partnership, even if the co-owners share

profits made by the use of the property;

(2) The sharing of gross returns does not by itself establish a partnership, even if the persons

sharing them have a joint or common right or interest in property from which the returns are

derived; and

(3) A person who receives a share of the profits of a business is presumed to be a partner

in the business, unless the profits were received in payment:

(i) Of a debt by installments or otherwise;

(ii) For services as an independent contractor or of wages or other compensation to an

employee;

(iii) Of rent;

(iv) Of an annuity or other retirement or health benefit to a deceased or retired partner or a

beneficiary, representative, or designee of a deceased or retired partner;

(v) Of interest or other charge on a loan, even if the amount of payment varies with the

profits of the business, including a direct or indirect present or future ownership of the collateral,

or rights to income, proceeds, or increase in value derived from the collateral; or

(vi) For the sale of the goodwill of a business or other property by installments or otherwise.

7-12.1-203. Partnership property.

Property acquired by a partnership is property of the partnership and not of the partners

individually.

7-12.1-204. When property is partnership property.

(a) Property is partnership property if acquired in the name of:

(1) The partnership; or

(2) One or more partners with an indication in the instrument transferring title to the

property of the person's capacity as a partner or of the existence of a partnership but without an

indication of the name of the partnership.

(b) Property is acquired in the name of the partnership by a transfer to:

(1) The partnership in its name; or

(2) One or more partners in their capacity as partners in the partnership, if the name of the

partnership is indicated in the instrument transferring title to the property.

even if not acquired in the name of the partnership or of one or more partners with an indication in

the instrument transferring title to the property of the person's capacity as a partner or of the

existence of a partnership.

(d) Property acquired in the name of one or more of the partners, without an indication in

the instrument transferring title to the property of the person's capacity as a partner or of the

existence of a partnership and without use of partnership assets, is presumed to be separate property,

even if used for partnership purposes.

ARTICLE 3

RELATIONS OF PARTNERS TO PERSONS DEALING WITH PARTNERSHIP

7-12.1-301. Partner agent of partnership.

Subject to the effect of a statement of partnership authority under § 7-12.1-303, the

following rules apply:

(1) Each partner is an agent of the partnership for the purpose of its business. An act of a

partner, including the signing of an instrument in the partnership name, for apparently carrying on

in the ordinary course the partnership business or business of the kind carried on by the partnership

binds the partnership, unless the partner did not have authority to act for the partnership in the

particular matter and the person with which the partner was dealing knew or had notice that the

partner lacked authority.

(2) An act of a partner which is not apparently for carrying on in the ordinary course the

partnership's business or business of the kind carried on by the partnership binds the partnership

only if the act was actually authorized by all the other partners.

7-12.1-302. Transfer of partnership property.

(a) Partnership property may be transferred as follows:

(1) Subject to the effect of a statement of partnership authority under § 7-12.1-303,

partnership property held in the name of the partnership may be transferred by an instrument of

transfer signed by a partner in the partnership name;

(2) Partnership property held in the name of one or more partners with an indication in the

instrument transferring the property to them of their capacity as partners or of the existence of a

partnership, but without an indication of the name of the partnership, may be transferred by an

instrument of transfer signed by the persons in whose name the property is held; or

(3) Partnership property held in the name of one or more persons other than the partnership,

without an indication in the instrument transferring the property to them of their capacity as partners

or of the existence of a partnership, may be transferred by an instrument of transfer signed by the

persons in whose name the property is held.

(b) A partnership may recover partnership property from a transferee only if it proves that

signing of the instrument of initial transfer did not bind the partnership under § 7-12.1-301 and:

(1) As to a subsequent transferee who gave value for property transferred under subsections

(a)(1) and (a)(2) of this section, proves that the subsequent transferee knew or had been notified

that the person who signed the instrument of initial transfer lacked authority to bind the partnership;

(2) As to a transferee who gave value for property transferred under subsection (a)(3) of

this section, proves that the transferee knew or had been notified that the property was partnership

property and that the person who signed the instrument of initial transfer lacked authority to bind

the partnership.

partnership would not have been entitled to recover the property, under subsection (b) of this

section, from any earlier transferee of the property.

(d) If a person holds all the partners' interests in the partnership, all the partnership property

vests in that person. The person may sign a record in the name of the partnership to evidence vesting

of the property in that person and may file or record the record.

7-12.1-303. Statement of partnership authority.

(a) A partnership may deliver to the secretary of state for filing a statement of partnership

authority. The statement:

(1) Must include the name of the partnership and:

(i) If the partnership is not a limited-liability partnership, the street and mailing addresses

of its principal office; or

(ii) If the partnership is a limited-liability partnership, the name and street and mailing

addresses of its registered agent;

(2) With respect to any position that exists in or with respect to the partnership, may state

the authority, or limitations on the authority, of all persons holding the position to:

(i) Sign an instrument transferring real property held in the name of the partnership; or

(ii) Enter into other transactions on behalf of, or otherwise act for or bind, the partnership;

and

(3) May state the authority, or limitations on the authority, of a specific person to:

(i) Sign an instrument transferring real property held in the name of the partnership; or

(ii) Enter into other transactions on behalf of, or otherwise act for or bind, the partnership.

(b) To amend or cancel a statement of authority filed by the secretary of state, a partnership

must deliver to the secretary of state for filing an amendment or cancellation stating:

(1) The name of the partnership;

(2) If the partnership is not a limited-liability partnership, the street and mailing addresses

of the partnership's principal office;

(3) If the partnership is a limited-liability partnership, the name and street and mailing

addresses of its registered agent;

(4) The date the statement being affected became effective; and

(5) The contents of the amendment or a declaration that the statement is canceled.

persons that are not partners.

(d) Subject to subsection (c) of this section and § 7-12.1-103(d)(1), and except as otherwise

provided in subsections (f), (g), and (h) of this section, a limitation on the authority of a person or

a position contained in an effective statement of authority is not by itself evidence of any person's

knowledge or notice of the limitation.

(e) Subject to subsection (c) of this section, a grant of authority not pertaining to transfers

of real property and contained in an effective statement of authority is conclusive in favor of a

person that gives value in reliance on the grant, except to the extent that if the person gives value:

(1) The person has knowledge to the contrary;

(2) The statement has been canceled or restrictively amended under subsection (b) of this

section; or

(3) A limitation on the grant is contained in another statement of authority that became

effective after the statement containing the grant became effective.

(f) Subject to subsection (c) of this section, an effective statement of authority that grants

authority to transfer real property held in the name of the partnership, a certified copy of which

statement is recorded in the office for recording transfers of the real property, is conclusive in favor

of a person that gives value in reliance on the grant without knowledge to the contrary, except to

the extent that when the person gives value:

(1) The statement has been canceled or restrictively amended under subsection (b) of this

section, and a certified copy of the cancellation or restrictive amendment has been recorded in the

office for recording transfers of the real property; or

(2) A limitation on the grant is contained in another statement of authority that became

effective after the statement containing the grant became effective, and a certified copy of the later-

effective statement is recorded in the office for recording transfers of the real property.

(g) Subject to subsection (c) of this section, if a certified copy of an effective statement

containing a limitation on the authority to transfer real property held in the name of a partnership

is recorded in the office for recording transfers of that real property, all persons are deemed to know

of the limitation.

(h) Subject to subsection (i) of this section, an effective statement of dissolution is a

cancellation of any filed statement of authority for the purposes of subsection (f) of this section and

is a limitation on authority for purposes of subsection (g) of this section.

(i) After a statement of dissolution becomes effective, a partnership may deliver to the

secretary of state for filing and, if appropriate, may record a statement of authority that is designated

as a post-dissolution statement of authority. The statement operates as provided in subsections (f)

and (g) of this section.

(j) Unless canceled earlier, an effective statement of authority is canceled by operation of

law five (5) years after the date on which the statement, or its most recent amendment, becomes

effective. The cancellation is effective without recording under subsection (f) or (g) of this section.

(k) An effective statement of denial operates as a restrictive amendment under this section

and may be recorded by certified copy for purposes of subsection (f)(1) of this section.

7-12.1-304. Statement of denial.

A person named in a filed statement of authority granting that person authority may deliver

to the secretary of state for filing a statement of denial that:

(1) Provides the name of the partnership and the caption of the statement of authority to

which the statement of denial pertains; and

(2) Denies the grant of authority.

7-12.1-305. Partnership liable for partner's actionable conduct.

(a) A partnership is liable for loss or injury caused to a person, or for a penalty incurred, as

a result of a wrongful act or omission, or other actionable conduct, of a partner acting in the ordinary

course of business of the partnership or with the actual or apparent authority of the partnership.

(b) If, in the course of the partnership's business or while acting with actual or apparent

authority of the partnership, a partner receives or causes the partnership to receive money or

property of a person not a partner, and the money or property is misapplied by a partner, the

partnership is liable for the loss.

7-12.1-306. Partner's liability.

(a) Except as otherwise provided in subsections (b) and (c) of this section, all partners are

liable jointly and severally for all debts, obligations, and other liabilities of the partnership unless

otherwise agreed by the claimant or provided by law.

(b) A person that becomes a partner is not personally liable for a debt, obligation, or other

liability of the partnership incurred before the person became a partner.

limited-liability partnership is solely the debt, obligation, or other liability of the limited-liability

partnership. A partner is not personally liable, directly or indirectly, by way of contribution or

otherwise, for a debt, obligation, or other liability of the limited-liability partnership solely by

reason of being or acting as a partner. This subsection applies:

(1) Despite anything inconsistent in the partnership agreement that existed immediately

before the vote or consent required to become a limited-liability partnership under § 7-12.1-901(b);

and

(2) Regardless of the dissolution of the limited-liability partnership.

(d) The failure of a limited-liability partnership to observe formalities relating to the

exercise of its powers or management of its business is not a ground for imposing liability on a

partner for a debt, obligation, or other liability of the partnership.

(e) The cancellation or administrative revocation of a limited-liability partnership's

statement of qualification does not affect the limitation in this section on the liability of a partner

for a debt, obligation, or other liability of the partnership incurred while the statement was in effect.

7-12.1-307. Actions by and against partnership and partners.

(a) A partnership may sue and be sued in the name of the partnership.

(b) To the extent not inconsistent with § 7-12.1-306, a partner may be joined in an action

against the partnership or named in a separate action.

judgment against a partnership may not be satisfied from a partner's assets unless there is also a

judgment against the partner.

(d) A judgment creditor of a partner may not levy execution against the assets of the partner

to satisfy a judgment based on a claim against the partnership unless the partner is personally liable

for the claim under § 7-12.1-306 and:

(1) A judgment based on the same claim has been obtained against the partnership and a

writ of execution on the judgment has been returned unsatisfied in whole or in part;

(2) The partnership is a debtor in bankruptcy;

(3) The partner has agreed that the creditor need not exhaust partnership assets;

(4) A court grants permission to the judgment creditor to levy execution against the assets

of a partner based on a finding that partnership assets subject to execution are clearly insufficient

to satisfy the judgment, that exhaustion of partnership assets is excessively burdensome, or that the

grant of permission is an appropriate exercise of the court's equitable powers; or

(5) Liability is imposed on the partner by law or contract independent of the existence of

the partnership.

(e) This section applies to any debt, liability, or other obligation of a partnership which

results from a representation by a partner or purported partner under § 7-12.1-308.

7-12.1-308. Liability of purported partner.

(a) If a person, by words or conduct, purports to be a partner, or consents to being

represented by another as a partner, in a partnership or with one or more persons not partners, the

purported partner is liable to a person to whom the representation is made, if that person, relying

on the representation, enters into a transaction with the actual or purported partnership. If the

representation, either by the purported partner or by a person with the purported partner's consent,

is made in a public manner, the purported partner is liable to a person who relies upon the purported

partnership even if the purported partner is not aware of being held out as a partner to the claimant.

If partnership liability results, the purported partner is liable with respect to that liability as if the

purported partner were a partner. If no partnership liability results, the purported partner is liable

with respect to that liability jointly and severally with any other person consenting to the

representation.

(b) If a person is thus represented to be a partner in an existing partnership, or with one or

more persons not partners, the purported partner is an agent of persons consenting to the

representation to bind them to the same extent and in the same manner as if the purported partner

were a partner with respect to persons who enter into transactions in reliance upon the

representation. If all the partners of the existing partnership consent to the representation, a

partnership act or obligation results. If fewer than all the partners of the existing partnership consent

to the representation, the person acting and the partners consenting to the representation are jointly

and severally liable.

partner in a statement of partnership authority.

(d) A person does not continue to be liable as a partner merely because of a failure to file

a statement of dissociation or to amend a statement of partnership authority to indicate the person's

dissociation as a partner.

(e) Except as otherwise provided in subsections (a) and (b) of this section, persons who are

not partners as to each other are not liable as partners to other persons.

ARTICLE 4

RELATIONS OF PARTNERS TO EACH OTHER AND TO PARTNERSHIP

7-12.1-401. Partner's rights and duties.

(a) Each partner is entitled to an equal share of the partnership distributions and, except in

the case of a limited-liability partnership, is chargeable with a share of the partnership losses in

proportion to the partner's share of the distributions.

(b) A partnership shall reimburse a partner for any payment made by the partner in the

course of the partner's activities on behalf of the partnership, if the partner complied with this

section and § 7-12.1-409 in making the payment.

demand against the person and any debt, obligation, or other liability incurred by the person by

reason of the person's former or present capacity as a partner, if the claim, demand, debt, obligation,

or other liability does not arise from the person's breach of this section or §§ 7-12.1-407 or 7-12.1-

409.

(d) In the ordinary course of its business, a partnership may advance reasonable expenses,

including attorneys' fees and costs, incurred by a person in connection with a claim or demand

against the person by reason of the person's former or present capacity as a partner, if the person

promises to repay the partnership if the person ultimately is determined not to be entitled to be

indemnified under subsection (c) of this section.

(e) A partnership may purchase and maintain insurance on behalf of a partner against

liability asserted against or incurred by the partner in that capacity or arising from that status even

if, under § 7-12.1-105(c)(7), the partnership agreement could not eliminate or limit the person's

liability to the partnership for the conduct giving rise to the liability.

(f) A partnership shall reimburse a partner for an advance to the partnership beyond the

amount of capital the partner agreed to contribute.

(g) A payment or advance made by a partner which gives rise to a partnership obligation

under subsections subsection (b) or (f) of this section constitutes a loan to the partnership which

accrues interest from the date of the payment or advance.

(h) Each partner has equal rights in the management and conduct of the partnership's

business.

(i) A partner may use or possess partnership property only on behalf of the partnership.

(j) A partner is not entitled to remuneration for services performed for the partnership,

except for reasonable compensation for services rendered in winding up the business of the

partnership.

(k) A difference arising as to a matter in the ordinary course of business of a partnership

may be decided by a majority of the partners. An act outside the ordinary course of business of a

partnership and an amendment to the partnership agreement may be undertaken only with the

affirmative vote or consent of all the partners.

7-12.1-402. Becoming partner.

(a) Upon formation of a partnership, a person becomes a partner under § 7-12.1-202(a).

(b) After formation of a partnership, a person becomes a partner:

(1) As provided in the partnership agreement;

(2) As a result of a transaction effective under Article 11 of this chapter; or

(3) With the affirmative vote or consent of all the partners.

(1) Acquiring a transferable interest; or

(2) Making or being obligated to make a contribution to the partnership.

7-12.1-403. Form of contribution.

A contribution may consist of property transferred to, services performed for, or another

benefit provided to the partnership or an agreement to transfer property to, perform services for, or

provide another benefit to the partnership.

7-12.1-404. Liability for contribution.

(a) A person's obligation to make a contribution to a partnership is not excused by the

person's death, disability, termination, or other inability to perform personally.

(b) If a person does not fulfill an obligation to make a contribution other than money, the

person is obligated at the option of the partnership to contribute money equal to the value of the

part of the contribution which has not been made.

affirmative vote or consent of all the partners. If a creditor of a limited-liability partnership extends

credit or otherwise acts in reliance on an obligation described in subsection (a) of this section

without knowledge or notice of a compromise under this subsection, the creditor may enforce the

obligation.

7-12.1-405. Sharing of and right to distributions before dissolution.

(a) Any distribution made by a partnership before its dissolution and winding up must be

in equal shares among partners, except to the extent necessary to comply with a transfer effective

under § 7-12.1-503 or charging order in effect under § 7-12.1-504.

(b) Subject to § 7-12.1-701, a person has a right to a distribution before the dissolution and

winding up of a partnership only if the partnership decides to make an interim distribution.

in any form other than money. Except as otherwise provided in § 7-12.1-806, a partnership may

distribute an asset in kind only if each part of the asset is fungible with each other part and each

person receives a percentage of the asset equal in value to the person's share of distributions.

(d) If a partner or transferee becomes entitled to receive a distribution, the partner or

transferee has the status of, and is entitled to all remedies available to, a creditor of the partnership

with respect to the distribution. However, the partnership's obligation to make a distribution is

subject to offset for any amount owed to the partnership by the partner or a person dissociated as

partner on whose account the distribution is made.

7-12.1-406. Limitations on distributions by limited-liability partnership.

(a) A limited-liability partnership may not make a distribution, including a distribution

under § 7-12.1-806, if after the distribution:

(1) The partnership would not be able to pay its debts as they become due in the ordinary

course of the partnership's business; or

(2) The partnership's total assets would be less than the sum of its total liabilities plus the

amount that would be needed, if the partnership were to be dissolved and wound up at the time of

the distribution, to satisfy the preferential rights upon dissolution and winding up of partners and

transferees whose preferential rights are superior to the rights of persons receiving the distribution.

(b) A limited-liability partnership may base a determination that a distribution is not

prohibited under subsection (a) of this section on:

(1) Financial statements prepared on the basis of accounting practices and principles that

are reasonable in the circumstances; or

(2) A fair valuation or other method that is reasonable under the circumstances.

under subsection (a) of this section is measured:

(1) In the case of a distribution as defined in § 7-12.1-102(4)(i) 7-12.1-102(5)(i), as of the

earlier of:

(i) The date money or other property is transferred or debt is incurred by the limited-

liability partnership; or

(ii) The date the person entitled to the distribution ceases to own the interest or rights being

acquired by the partnership in return for the distribution;

(2) In the case of any other distribution of indebtedness, as of the date the indebtedness is

distributed; and

(3) In all other cases, as of the date:

(i) The distribution is authorized, if the payment occurs not later than one hundred twenty

(120) days after that date; or

(ii) The payment is made, if the payment occurs more than one hundred twenty (120) days

after the distribution is authorized.

(d) A limited-liability partnership's indebtedness to a partner or transferee incurred by

reason of a distribution made in accordance with this section is at parity with the partnership's

indebtedness to its general, unsecured creditors, except to the extent subordinated by agreement.

(e) A limited-liability partnership's indebtedness, including indebtedness issued as a

distribution, is not a liability for purposes of subsection (a) of this section if the terms of the

indebtedness provide that payment of principal and interest is made only if and to the extent that a

payment of a distribution could then be made under this section. If the indebtedness is issued as a

distribution, each payment of principal or interest is treated as a distribution, the effect of which is

measured on the date the payment is made.

(f) In measuring the effect of a distribution under § 7-12.1-806, the liabilities of a dissolved

limited-liability partnership do not include any claim that has been disposed of under §§ 7-12.1-

807, 7-12.1-808, or 7-12.1-809.

7-12.1-407. Liability for improper distributions by limited-liability partnership.

(a) Except as otherwise provided in subsection (b) of this section, if a partner of a limited-

liability partnership consents to a distribution made in violation of § 7-12.1-406 and in consenting

to the distribution fails to comply with § 7-12.1-409, the partner is personally liable to the

partnership for the amount of the distribution which exceeds the amount that could have been

distributed without the violation of § 7-12.1-406.

(b) To the extent the partnership agreement of a limited-liability partnership expressly

relieves a partner of the authority and responsibility to consent to distributions and imposes that

authority and responsibility on one or more other partners, the liability stated in subsection (a) of

this section applies to the other partners and not to the partner that the partnership agreement

relieves of the authority and responsibility.

406 is personally liable to the limited-liability partnership but only to the extent that the distribution

received by the person exceeded the amount that could have been properly paid under § 7-12.1-

406.

(d) A person against which an action is commenced because the person is liable under

subsection (a) of this section may:

(1) Implead any other person that is liable under subsection (a) of this section and seek to

enforce a right of contribution from the person; and

(2) Implead any person that received a distribution in violation of subsection (c) of this

section and seek to enforce a right of contribution from the person in the amount the person received

in violation of subsection (c) of this section.

(e) An action under this section is barred unless commenced not later than two (2) years

after the distribution.

7-12.1-408. Rights to information of partners and persons dissociated as partner.

(a) A partnership shall keep its books and records, if any, at its principal office.

(b) On reasonable notice, a partner may inspect and copy during regular business hours, at

a reasonable location specified by the partnership, any record maintained by the partnership

regarding the partnership's business, financial condition, and other circumstances, to the extent the

information is material to the partner's rights and duties under the partnership agreement or this

chapter.

(1) Without demand, any information concerning the partnership's business, financial

condition, and other circumstances which the partnership knows and is material to the proper

exercise of the partner's rights and duties under the partnership agreement or this chapter, except to

the extent the partnership can establish that it reasonably believes the partner already knows the

information; and

(2) On demand, any other information concerning the partnership's business, financial

condition, and other circumstances, except to the extent the demand or the information demanded

is unreasonable or otherwise improper under the circumstances.

(d) The duty to furnish information under subsection (c) of this section also applies to each

partner to the extent the partner knows any of the information described in subsection (c) of this

section.

(e) Subject to subsection (j) of this section, on ten (10) days' demand made in a record

received by a partnership, a person dissociated as a partner may have access to information to which

the person was entitled while a partner if:

(1) The information pertains to the period during which the person was a partner;

(2) The person seeks the information in good faith; and

(3) The person satisfies the requirements imposed on a partner by subsection (b) of this

section.

(f) Not later than ten (10) days after receiving a demand under subsection (e) of this section,

the partnership in a record shall inform the person that made the demand of:

(1) The information that the partnership will provide in response to the demand and when

and where the partnership will provide the information; and

(2) The partnership's reasons for declining, if the partnership declines to provide any

demanded information.

(g) A partnership may charge a person that makes a demand under this section the

reasonable costs of copying, limited to the costs of labor and material.

(h) A partner or person dissociated as a partner may exercise the rights under this section

through an agent or, in the case of an individual under legal disability, a legal representative. Any

restriction or condition imposed by the partnership agreement or under subsection (j) of this section

applies both to the agent or legal representative and to the partner or person dissociated as a partner.

(i) Subject to § 7-12.1-505, the rights under this section do not extend to a person as

transferee.

(j) In addition to any restriction or condition stated in its partnership agreement, a

partnership, as a matter within the ordinary course of its business, may impose reasonable

restrictions and conditions on access to and use of information to be furnished under this section,

including designating information confidential and imposing nondisclosure and safeguarding

obligations on the recipient. In a dispute concerning the reasonableness of a restriction under this

subsection, the partnership has the burden of proving reasonableness.

7-12.1-409. Standards of conduct for partners.

(a) A partner owes to the partnership and the other partners the duties of loyalty and care

stated in subsections (b) and (c) of this section.

(b) The fiduciary duty of loyalty of a partner includes the duties:

(1) To account to the partnership and hold as trustee for it any property, profit, or benefit

derived by the partner:

(i) In the conduct or winding up of the partnership's business;

(ii) From a use by the partner of the partnership's property; or

(iii) From the appropriation of a partnership opportunity;

(2) To refrain from dealing with the partnership in the conduct or winding up of the

partnership business as or on behalf of a person having an interest adverse to the partnership; and

(3) To refrain from competing with the partnership in the conduct of the partnership's

business before the dissolution of the partnership.

is to refrain from engaging in grossly negligent or reckless conduct, willful or intentional

misconduct, or a knowing violation of law.

(d) A partner shall discharge the duties and obligations under this chapter or under the

partnership agreement and exercise any rights consistently with the contractual obligation of good

faith and fair dealing.

(e) A partner does not violate a duty or obligation under this chapter or under the

partnership agreement solely because the partner's conduct furthers the partner's own interest.

(f) All the partners may authorize or ratify, after full disclosure of all material facts, a

specific act or transaction by a partner that otherwise would violate the duty of loyalty.

(g) It is a defense to a claim under subsection (b)(2) of this section and any comparable

claim in equity or at common law that the transaction was fair to the partnership.

(h) If, as permitted by subsection (f) of this section or the partnership agreement, a partner

enters into a transaction with the partnership which otherwise would be prohibited by subsection

(b)(2) of this section, the partner's rights and obligations arising from the transaction are the same

as those of a person that is not a partner.

7-12.1-410. Actions by partnership and partners.

(a) A partnership may maintain an action against a partner for a breach of the partnership

agreement, or for the violation of a duty to the partnership, causing harm to the partnership.

(b) A partner may maintain an action against the partnership or another partner, with or

without an accounting as to partnership business, to enforce the partner's rights and protect the

partner's interests, including rights and interests under the partnership agreement or this chapter or

arising independently of the partnership relationship.

by law.

7-12.1-411. Continuation of partnership beyond definite term or particular

undertaking.

(a) If a partnership for a definite term or particular undertaking is continued, without an

express agreement, after the expiration of the term or completion of the undertaking, the rights and

duties of the partners remain the same as they were at the expiration or completion, so far as is

consistent with a partnership at will.

(b) If the partners, or those of them who habitually acted in the business during the term or

undertaking, continue the business without any settlement or liquidation of the partnership, they

are presumed to have agreed that the partnership will continue.

ARTICLE 5

TRANSFERABLE INTERESTS AND RIGHTS OF TRANSFEREES AND

CREDITORS

7-12.1-501. Partner not co-owner of partnership property.

A partner is not a co-owner of partnership property and has no interest in partnership

property which can be transferred, either voluntarily or involuntarily.

7-12.1-502. Nature of transferable interest.

A transferable interest is personal property.

7-12.1-503. Transfer of transferable interest.

(a) A transfer, in whole or in part, of a transferable interest:

(1) Is permissible;

(2) Does not by itself cause a person's dissociation as a partner or a dissolution and winding

up of the partnership business; and

(3) Subject to § 7-12.1-505, does not entitle the transferee to:

(i) Participate in the management or conduct of the partnership's business; or

(ii) Except as otherwise provided in subsection (c) of this section, have access to records

or other information concerning the partnership's business.

(b) A transferee has the right to:

(1) Receive, in accordance with the transfer, distributions to which the transferor would

otherwise be entitled; and

(2) Seek under § 7-12.1-801(5) a judicial determination that it is equitable to wind up the

partnership business.

of the partnership's transactions only from the date of dissolution.

(d) A partnership need not give effect to a transferee's rights under this section until the

partnership knows or has notice of the transfer.

(e) A transfer of a transferable interest in violation of a restriction on transfer contained in

the partnership agreement is ineffective if the intended transferee has knowledge or notice of the

restriction at the time of transfer.

(f) Except as otherwise provided in § 7-12.1-601(4)(ii), if a partner transfers a transferable

interest, the transferor retains the rights of a partner other than the transferable interest transferred

and retains all the duties and obligations of a partner.

(g) If a partner transfers a transferable interest to a person that becomes a partner with

respect to the transferred interest, the transferee is liable for the partner's obligations under §§ 7-

12.1-404 and 7-12.1-407 known to the transferee when the transferee becomes a partner.

7-12.1-504. Charging order.

(a) On application by a judgment creditor of a partner or transferee, a court may enter a

charging order against the transferable interest of the judgment debtor for the unsatisfied amount

of the judgment. A charging order constitutes a lien on a judgment debtor's transferable interest and

requires the partnership to pay over to the person to which the charging order was issued any

distribution that otherwise would be paid to the judgment debtor.

(b) To the extent necessary to effectuate the collection of distributions pursuant to a

charging order in effect under subsection (a) of this section, the court may:

(1) Appoint a receiver of the distributions subject to the charging order, with the power to

make all inquiries the judgment debtor might have made; and

(2) Make all other orders necessary to give effect to the charging order.

debt within a reasonable time, the court may foreclose the lien and order the sale of the transferable

interest. The purchaser at the foreclosure sale obtains only the transferable interest, does not thereby

become a partner, and is subject to § 7-12.1-503.

(d) At any time before foreclosure under subsection (c) of this section, the partner or

transferee whose transferable interest is subject to a charging order under subsection (a) of this

section may extinguish the charging order by satisfying the judgment and filing a certified copy of

the satisfaction with the court that issued the charging order.

(e) At any time before foreclosure under subsection (c) of this section, a partnership or one

or more partners whose transferable interests are not subject to the charging order may pay to the

judgment creditor the full amount due under the judgment and thereby succeed to the rights of the

judgment creditor, including the charging order.

(f) This chapter does not deprive any partner or transferee of the benefit of any exemption

law applicable to the transferable interest of the partner or transferee.

(g) This section provides the exclusive remedy by which a person seeking in the capacity

of a judgment creditor to enforce a judgment against a partner or transferee may satisfy the

judgment from the judgment debtor's transferable interest.

7-12.1-505. Power of legal representative of deceased partner.

If a partner dies, the deceased partner's legal representative may exercise:

(1) The rights of a transferee provided in § 7-12.1-503(c); and

(2) For purposes of settling the estate, the rights the deceased partner had under § 7-12.1-

408.

ARTICLE 6

DISSOCIATION

7-12.1-601. Events causing dissociation.

A person is dissociated as a partner when:

(1) The partnership knows or has notice of the person's express will to withdraw as a

partner, but, if the person has specified a withdrawal date later than the date the partnership knew

or had notice, on that later date;

(2) An event stated in the partnership agreement as causing the person's dissociation occurs;

(3) The person is expelled as a partner pursuant to the partnership agreement;

(4) The person is expelled as a partner by the affirmative vote or consent of all the other

partners if:

(i) It is unlawful to carry on the partnership business with the person as a partner;

(ii) There has been a transfer of all of the person's transferable interest in the partnership,

other than:

(A) A transfer for security purposes; or

(B) A charging order in effect under § 7-12.1-504 which has not been foreclosed;

(iii) The person is an entity and:

(A) The partnership notifies the person that it will be expelled as a partner because the

person has filed a statement of dissolution or the equivalent, the person has been administratively

dissolved, the person's charter or the equivalent has been revoked, or the person's right to conduct

business has been suspended by the person's jurisdiction of formation; and

(B) Not later than ninety (90) days after the notification, the statement of dissolution or the

equivalent has not been withdrawn, rescinded, or revoked, or the person's charter or the equivalent

or right to conduct business has not been reinstated; or

(iv) The person is an unincorporated entity that has been dissolved and whose activities

and affairs are being wound up;

(5) On application by the partnership or another partner, the person is expelled as a partner

by judicial order because the person:

(i) Has engaged or is engaging in wrongful conduct that has affected adversely and

materially, or will affect adversely and materially, the partnership's business;

(ii) Has committed willfully or persistently, or is committing willfully or persistently, a

material breach of the partnership agreement or a duty or obligation under § 7-12.1-409; or

(iii) Has engaged or is engaging in conduct relating to the partnership's business which

makes it not reasonably practicable to carry on the business with the person as a partner;

(6) The person:

(i) Becomes a debtor in bankruptcy;

(ii) Signs an assignment for the benefit of creditors; or

(iii) Seeks, consents to, or acquiesces in the appointment of a trustee, receiver, or liquidator

of the person or of all or substantially all the person's property;

(7) In the case of an individual:

(i) The individual dies;

(ii) A guardian or general conservator for the individual is appointed; or

(iii) A court orders that the individual has otherwise become incapable of performing the

individual's duties as a partner under this chapter or the partnership agreement;

(8) In the case of a person that is a testamentary or inter vivos trust or is acting as a partner

by virtue of being a trustee of such a trust, the trust's entire transferable interest in the partnership

is distributed;

(9) In the case of a person that is an estate or is acting as a partner by virtue of being a

personal representative of an estate, the estate's entire transferable interest in the partnership is

distributed;

(10) In the case of a person that is not an individual, the existence of the person terminates;

(11) The partnership participates in a merger under Article 11 of this chapter and:

(i) The partnership is not the surviving entity; or

(ii) Otherwise as a result of the merger, the person ceases to be a partner;

(12) The partnership participates in an interest exchange under Article 11 of this chapter

and, as a result of the interest exchange, the person ceases to be a partner;

(13) The partnership participates in a conversion under Article 11 of this chapter;

(14) The partnership participates in a domestication under Article 11 of this chapter and,

as a result of the domestication, the person ceases to be a partner; or

(15) The partnership dissolves and completes winding up.

7-12.1-602. Power to dissociate as partner -- Wrongful dissociation.

(a) A person has the power to dissociate as a partner at any time, rightfully or wrongfully,

by withdrawing as a partner by express will under § 7-12.1-601(1).

(b) A person's dissociation as a partner is wrongful only if the dissociation:

(1) Is in breach of an express provision of the partnership agreement; or

(2) In the case of a partnership for a definite term or particular undertaking, occurs before

the expiration of the term or the completion of the undertaking and:

(i) The person withdraws as a partner by express will, unless the withdrawal follows not

later than ninety (90) days after another person's dissociation by death or otherwise under §§ 7-

12.1-601(6) through 7-12.1-601(10) or wrongful dissociation under this subsection;

(ii) The person is expelled as a partner by judicial order under § 7-12.1-601(5);

(iii) The person is dissociated under § 7-12.1-601(6); or

(iv) In the case of a person that is not a trust other than a business trust, an estate, or an

individual, the person is expelled or otherwise dissociated because it willfully dissolved or

terminated.

other partners for damages caused by the dissociation. The liability is in addition to any debt,

obligation, or other liability of the partner to the partnership or the other partners.

7-12.1-603. Effect of dissociation.

(a) If a person's dissociation results in a dissolution and winding up of the partnership

business, Article 8 of this chapter applies; otherwise, Article 7 of this chapter applies.

(b) If a person is dissociated as a partner:

(1) The person's right to participate in the management and conduct of the partnership's

business terminates, except as otherwise provided in § 7-12.1-802(c); and

(2) The person's duties and obligations under § 7-12.1-409 end with regard to matters

arising and events occurring after the person's dissociation, except to the extent the partner

participates in winding up the partnership's business pursuant to § 7-12.1-802.

or other liability to the partnership or the other partners which the person incurred while a partner.

ARTICLE 7

PERSON'S DISSOCIATION AS A PARTNER WHEN BUSINESS NOT WOUND UP

7-12.1-701. Purchase of interest of person dissociated as partner.

(a) If a person is dissociated as a partner without the dissociation resulting in a dissolution

and winding up of the partnership business under § 7-12.1-801, the partnership shall cause the

person's interest in the partnership to be purchased for a buyout price determined pursuant to

subsection (b) of this section.

(b) The buyout price of the interest of a person dissociated as a partner is the amount that

would have been distributable to the person under § 7-12.1-806(b) if, on the date of dissociation,

the assets of the partnership were sold and the partnership were wound up, with the sale price equal

to the greater of:

(1) The liquidation value; or

(2) The value based on a sale of the entire business as a going concern without the person.

but damages for wrongful dissociation under § 7-12.1-602(b), and all other amounts owing,

whether or not presently due, from the person dissociated as a partner to the partnership, must be

offset against the buyout price.

(d) A partnership shall defend, indemnify, and hold harmless a person dissociated as a

partner whose interest is being purchased against all partnership liabilities, whether incurred before

or after the dissociation, except liabilities incurred by an act of the person under § 7-12.1-702.

(e) If no agreement for the purchase of the interest of a person dissociated as a partner is

reached not later than one hundred twenty (120) days after a written demand for payment, the

partnership shall pay, or cause to be paid, in money to the person the amount the partnership

estimates to be the buyout price and accrued interest, reduced by any offsets and accrued interest

under subsection (c) of this section.

(f) If a deferred payment is authorized under subsection (h) of this section, the partnership

may tender a written offer to pay the amount it estimates to be the buyout price and accrued interest,

reduced by any offsets under subsection (c) of this section, stating the time of payment, the amount

and type of security for payment, and the other terms and conditions of the obligation.

(g) The payment or tender required by subsections subsection (e) or (f) of this section must

be accompanied by the following:

(1) A statement of partnership assets and liabilities as of the date of dissociation;

(2) The latest available partnership balance sheet and income statement, if any;

(3) An explanation of how the estimated amount of the payment was calculated; and

(4) Written notice that the payment is in full satisfaction of the obligation to purchase

unless, not later than one hundred twenty (120) days after the written notice, the person dissociated

as a partner commences an action to determine the buyout price, any offsets under subsection (c)

of this section, or other terms of the obligation to purchase.

(h) A person that wrongfully dissociates as a partner before the expiration of a definite term

or the completion of a particular undertaking is not entitled to payment of any part of the buyout

price until the expiration of the term or completion of the undertaking, unless the person establishes

to the satisfaction of the court that earlier payment will not cause undue hardship to the business of

the partnership. A deferred payment must be adequately secured and bear interest.

(i) A person dissociated as a partner may maintain an action against the partnership,

pursuant to § 7-12.1-410(b)(2), to determine the buyout price of that person's interest, any offsets

under subsection (c) of this section, or other terms of the obligation to purchase. The action must

be commenced not later than one hundred twenty (120) days after the partnership has tendered

payment or an offer to pay or within one year after written demand for payment if no payment or

offer to pay is tendered. The court shall determine the buyout price of the person's interest, any

offset due under subsection (c) of this section, and accrued interest, and enter judgment for any

additional payment or refund. If deferred payment is authorized under subsection (h) of this section,

the court shall also determine the security for payment and other terms of the obligation to purchase.

The court may assess reasonable attorneys' fees and the fees and expenses of appraisers or other

experts for a party to the action, in amounts the court finds equitable, against a party that the court

finds acted arbitrarily, vexatiously, or not in good faith. The finding may be based on the

partnership's failure to tender payment or an offer to pay or to comply with subsection (g) of this

section.

7-12.1-702. Power to bind and liability of person dissociated as partner.

(a) After a person is dissociated as a partner without the dissociation resulting in a

dissolution and winding up of the partnership business and before the partnership is merged out of

existence, converted, or domesticated under Article 11, or dissolved, the partnership is bound by

an act of the person only if:

(1) The act would have bound the partnership under § 7-12.1-301 before dissociation; and

(2) At the time the other party enters into the transaction:

(i) Less than two (2) years has passed since the dissociation; and

(ii) The other party does not know or have notice of the dissociation and reasonably

believes that the person is a partner.

(b) If a partnership is bound under subsection (a) of this section, the person dissociated as

a partner which caused the partnership to be bound is liable:

(1) To the partnership for any damage caused to the partnership arising from the obligation

incurred under subsection (a) of this section; and

(2) If a partner or another person dissociated as a partner is liable for the obligation, to the

partner or other person for any damage caused to the partner or other person arising from the

liability.

7-12.1-703. Liability of person dissociated as partner to other persons.

(a) Except as otherwise provided in subsection (b) of this section, a person dissociated as

a partner is not liable for a partnership obligation incurred after dissociation.

(b) A person that is dissociated as a partner is liable on a transaction entered into by the

partnership after the dissociation only if:

(1) A partner would be liable on the transaction; and

(2) At the time the other party enters into the transaction:

(i) Less than two (2) years has passed since the dissociation; and

(ii) The other party does not have knowledge or notice of the dissociation and reasonably

believes that the person is a partner.

as a partner may be released from liability for a debt, obligation, or other liability of the partnership.

(d) A person dissociated as a partner is released from liability for a debt, obligation, or

other liability of the partnership if the partnership's creditor, with knowledge or notice of the

person's dissociation but without the person's consent, agrees to a material alteration in the nature

or time of payment of the debt, obligation, or other liability.

7-12.1-704. Statement of dissociation.

(a) A person dissociated as a partner or the partnership may deliver to the secretary of state

for filing a statement of dissociation stating the name of the partnership and that the person has

dissociated from the partnership.

(b) A statement of dissociation is a limitation on the authority of a person dissociated as a

partner for the purposes of § 7-12.1-303.

7-12.1-705. Continued use of partnership name.

Continued use of a partnership name, or the name of a person dissociated as a partner as

part of the partnership name, by partners continuing the business does not of itself make the person

dissociated as a partner liable for an obligation of the partners or the partnership continuing the

business.

ARTICLE 8

DISSOLUTION AND WINDING UP

7-12.1-801. Events causing dissolution.

A partnership is dissolved, and its business must be wound up, upon the occurrence of any

of the following:

(1) In a partnership at will, the partnership knows or has notice of a person's express will

to withdraw as a partner, other than a partner that has dissociated under §§ 7-12.1-601(2) through

7-12.1-601(10), but, if the person has specified a withdrawal date later than the date the partnership

knew or had notice, on the later date;

(2) In a partnership for a definite term or particular undertaking:

(i) Within ninety (90) days after a person's dissociation by death or otherwise under §§ 7-

12.1-601(6) through 7-12.1-601(10) or wrongful dissociation under § 7-12.1-602(b), the

affirmative vote or consent of at least half of the remaining partners to wind up the partnership

business, for which purpose a person's rightful dissociation pursuant to § 7-12.1-602(b)(2)(i)

constitutes that partner's consent to wind up the partnership business;

(ii) The affirmative vote or consent of all the partners to wind up the partnership business;

(iii) The expiration of the term or the completion of the undertaking;

(3) An event or circumstance that the partnership agreement states causes dissolution;

(4) On application by a partner, the entry by the superior court of an order dissolving the

partnership on the grounds that:

(i) The conduct of all or substantially all the partnership's business is unlawful;

(ii) The economic purpose of the partnership is likely to be unreasonably frustrated;

(iii) Another partner has engaged in conduct relating to the partnership business which

makes it not reasonably practicable to carry on the business in partnership with that partner; or

(iv) It is otherwise not reasonably practicable to carry on the partnership business in

conformity with the partnership agreement;

(5) On application by a transferee, the entry by the superior court of an order dissolving

the partnership on the ground that it is equitable to wind up the partnership business:

(i) After the expiration of the term or completion of the undertaking, if the partnership was

for a definite term or particular undertaking at the time of the transfer or entry of the charging order

that gave rise to the transfer; or

(ii) At any time, if the partnership was a partnership at will at the time of the transfer or

entry of the charging order that gave rise to the transfer; or

(6) The passage of ninety (90) consecutive days during which the partnership does not have

at least two (2) partners.

7-12.1-802. Winding up.

(a) A dissolved partnership shall wind up its business and, except as otherwise provided in

§ 7-12.1-803, the partnership continues after dissolution only for the purpose of winding up.

(b) In winding up its business, the partnership:

(1) Shall discharge the partnership's debts, obligations, and other liabilities, settle and close

the partnership's business, and marshal and distribute the assets of the partnership; and

(2) May:

(i) Deliver to the secretary of state for filing a statement of dissolution stating the name of

the partnership and that the partnership is dissolved;

(ii) Preserve the partnership business and property as a going concern for a reasonable time;

(iii) Prosecute and defend actions and proceedings, whether civil, criminal, or

administrative;

(iv) Transfer the partnership's property;

(v) Settle disputes by mediation or arbitration;

(vi) Deliver to the secretary of state for filing a statement of termination stating the name

of the partnership and that the partnership is terminated; and

(vii) Perform other acts necessary or appropriate to the winding up.

winding up as if still a partner, unless the dissociation was wrongful.

(d) If a dissolved partnership does not have a partner and no person has the right to

participate in winding up under subsection (c) of this section, the personal or legal representative

of the last person to have been a partner may wind up the partnership's business. If the representative

does not exercise that right, a person to wind up the partnership's business may be appointed by the

affirmative vote or consent of transferees owning a majority of the rights to receive distributions at

the time the consent is to be effective. A person appointed under this subsection has the powers of

a partner under § 7-12.1-804 but is not liable for the debts, obligations, and other liabilities of the

partnership solely by reason of having or exercising those powers or otherwise acting to wind up

the partnership's business.

(e) On the application of any partner or person entitled under subsection (c) of this section

to participate in winding up, the superior court may order judicial supervision of the winding up of

a dissolved partnership, including the appointment of a person to wind up the partnership's business,

if:

(1) The partnership does not have a partner and within a reasonable time following the

dissolution no person has been appointed under subsection (d) of this section; or

(2) The applicant establishes other good cause.

7-12.1-803. Rescinding dissolution.

(a) A partnership may rescind its dissolution, unless a statement of termination applicable

to the partnership has become effective or the superior court has entered an order under §§ 7-12.1-

801(4) or 7-12.1-801(5) dissolving the partnership.

(b) Rescinding dissolution under this section requires:

(1) The affirmative vote or consent of each partner; and

(2) If the partnership has filed with the secretary of state a statement of dissolution and:

(i) The statement has not become effective, delivery to the secretary of state for filing of a

statement of withdrawal under § 7-12.1-115 applicable to the statement of dissolution; or

(ii) The statement of dissolution has become effective, delivery to the secretary of state for

filing of a statement of rescission stating the name of the partnership and that dissolution has been

rescinded under this section.

(1) The partnership resumes carrying on its business as if dissolution had never occurred;

(2) Subject to subsection (c)(3) of this section, any liability incurred by the partnership

after the dissolution and before the rescission has become effective is determined as if dissolution

had never occurred; and

(3) The rights of a third party arising out of conduct in reliance on the dissolution before

the third party knew or had notice of the rescission may not be adversely affected.

7-12.1-804. Power to bind partnership after dissolution.

(a) A partnership is bound by a partner's act after dissolution which:

(1) Is appropriate for winding up the partnership business; or

(2) Would have bound the partnership under § 7-12.1-301 before dissolution if, at the time

the other party enters into the transaction, the other party does not know or have notice of the

dissolution.

(b) A person dissociated as a partner binds a partnership through an act occurring after

dissolution if:

(1) At the time the other party enters into the transaction:

(i) Less than two (2) years has passed since the dissociation; and

(ii) The other party does not know or have notice of the dissociation and reasonably

believes that the person is a partner; and

(2) The act:

(i) Is appropriate for winding up the partnership's business; or

(ii) Would have bound the partnership under § 7-12.1-301 before dissolution and at the

time the other party enters into the transaction the other party does not know or have notice of the

dissolution.

7-12.1-805. Liability after dissolution of partner and person dissociated as partner.

(a) If a partner having knowledge of the dissolution causes a partnership to incur an

obligation under § 7-12.1-804(a) by an act that is not appropriate for winding up the partnership

business, the partner is liable:

(1) To the partnership for any damage caused to the partnership arising from the obligation;

and

(2) If another partner or person dissociated as a partner is liable for the obligation, to that

other partner or person for any damage caused to that other partner or person arising from the

liability.

(b) Except as otherwise provided in subsection (c) of this section, if a person dissociated

as a partner causes a partnership to incur an obligation under § 7-12.1-804(b), the person is liable:

(1) To the partnership for any damage caused to the partnership arising from the obligation;

and

(2) If a partner or another person dissociated as a partner is liable for the obligation, to the

partner or other person for any damage caused to the partner or other person arising from the

obligation.

(1) Section 7-12.1-802(c) permits the person to participate in winding up; and

(2) The act that causes the partnership to be bound under § 7-12.1-804(b) is appropriate for

winding up the partnership's business.

7-12.1-806. Disposition of assets in winding up -- When contributions required.

(a) In winding up its business, a partnership shall apply its assets, including the

contributions required by this section, to discharge the partnership's obligations to creditors,

including partners that are creditors.

(b) After a partnership complies with subsection (a) of this section, any surplus must be

distributed in the following order, subject to any charging order in effect under § 7-12.1-504:

(1) To each person owning a transferable interest that reflects contributions made and not

previously returned, an amount equal to the value of the unreturned contributions; and

(2) Among persons owning transferable interests in proportion to their respective rights to

share in distributions immediately before the dissolution of the partnership.

of this section, with respect to each unsatisfied obligation incurred when the partnership was not a

limited-liability partnership, the following rules apply:

(1) Each person that was a partner when the obligation was incurred and that has not been

released from the obligation under §§ 7-12.1-703(c) and 7-12.1-703(d) shall contribute to the

partnership for the purpose of enabling the partnership to satisfy the obligation. The contribution

due from each of those persons is in proportion to the right to receive distributions in the capacity

of a partner in effect for each of those persons when the obligation was incurred.

(2) If a person does not contribute the full amount required under subsection (c)(1) of this

section with respect to an unsatisfied obligation of the partnership, the other persons required to

contribute by subsection (c)(1) of this section on account of the obligation shall contribute the

additional amount necessary to discharge the obligation. The additional contribution due from each

of those other persons is in proportion to the right to receive distributions in the capacity of a partner

in effect for each of those other persons when the obligation was incurred.

(3) If a person does not make the additional contribution required by subsection (c)(2) of

this section, further additional contributions are determined and due in the same manner as provided

in that subsection.

(d) A person that makes an additional contribution under subsection (c)(2) or (c)(3) of this

section may recover from any person whose failure to contribute under subsection (c)(1) or (c)(2)

of this section necessitated the additional contribution. A person may not recover under this

subsection more than the amount additionally contributed. A person's liability under this subsection

may not exceed the amount the person failed to contribute.

(e) If a partnership does not have sufficient surplus to comply with subsection (b)(1) of this

section, any surplus must be distributed among the owners of transferable interests in proportion to

the value of the respective unreturned contributions.

(f) All distributions made under subsections (b) and (c) of this section must be paid in

money.

7-12.1-807. Known claims against dissolved limited-liability partnership.

(a) Except as otherwise provided in subsection (d) of this section, a dissolved limited-

liability partnership may give notice of a known claim under subsection (b) of this section, which

has the effect provided in subsection (c) of this section.

(b) A dissolved limited-liability partnership may in a record notify its known claimants of

the dissolution. The notice must:

(1) Specify the information required to be included in a claim;

(2) State that a claim must be in writing and provide a mailing address to which the claim

is to be sent;

(3) State the deadline for receipt of a claim, which may not be less than one hundred twenty

(120) days after the date the notice is received by the claimant;

(4) State that the claim will be barred if not received by the deadline; and

(5) Unless the partnership has been throughout its existence a limited-liability partnership,

state that the barring of a claim against the partnership will also bar any corresponding claim against

any partner or person dissociated as a partner which is based on § 7-12.1-306.

subsection (b) of this section are met and:

(1) The claim is not received by the specified deadline; or

(2) If the claim is timely received but rejected by the limited-liability partnership:

(i) The partnership causes the claimant to receive a notice in a record stating that the claim

is rejected and will be barred unless the claimant commences an action against the partnership to

enforce the claim not later than ninety (90) days after the claimant receives the notice; and

(ii) The claimant does not commence the required action not later than ninety (90) days

after the claimant receives the notice.

(d) This section does not apply to a claim based on an event occurring after the date of

dissolution or a liability that on that date is contingent.

7-12.1-808. Other claims against dissolved limited-liability partnership.

(a) A dissolved limited-liability partnership may publish notice of its dissolution and

request persons having claims against the partnership to present them in accordance with the notice.

(b) A notice under subsection (a) of this section must:

(1) Be published at least once in a newspaper of general circulation;

(2) Describe the information required to be contained in a claim, state that the claim must

be in writing, and provide a mailing address to which the claim is to be sent;

(3) State that a claim against the partnership is barred unless an action to enforce the claim

is commenced not later than three (3) years after publication of the notice; and

(4) Unless the partnership has been throughout its existence a limited-liability partnership,

state that the barring of a claim against the partnership will also bar any corresponding claim against

any partner or person dissociated as a partner which is based on § 7-12.1-306.

subsection (b) of this section, the claim of each of the following claimants is barred unless the

claimant commences an action to enforce the claim against the partnership not later than three (3)

years after the publication date of the notice:

(1) A claimant that did not receive notice in a record under § 7-12.1-807;

(2) A claimant whose claim was timely sent to the partnership but not acted on; and

(3) A claimant whose claim is contingent at, or based on an event occurring after, the date

of dissolution.

(d) A claim not barred under this section or § 7-12.1-807 may be enforced:

(1) Against a dissolved limited-liability partnership, to the extent of its undistributed assets;

(2) Except as otherwise provided in § 7-12.1-809, if assets of the partnership have been

distributed after dissolution, against a partner or transferee to the extent of that person's

proportionate share of the claim or of the partnership's assets distributed to the partner or transferee

after dissolution, whichever is less, but a person's total liability for all claims under this subsection

may not exceed the total amount of assets distributed to the person after dissolution; and

(3) Against any person liable on the claim under §§ 7-12.1-306, 7-12.1-703, and 7-12.1-

805.

7-12.1-809. Court proceedings.

(a) A dissolved limited-liability partnership that has published a notice under § 7-12.1-808

may file an application with the Providence County superior court for a determination of the amount

and form of security to be provided for payment of claims that are reasonably expected to arise

after the date of dissolution based on facts known to the partnership and:

(1) At the time of the application:

(i) Are contingent; or

(ii) Have not been made known to the partnership; or

(2) Are based on an event occurring after the date of dissolution.

(b) Security is not required for any claim that is or is reasonably anticipated to be barred

under § 7-12.1-807.

section, the dissolved limited-liability partnership shall give notice of the proceeding to each

claimant holding a contingent claim known to the partnership.

(d) In any proceeding under this section, the court may appoint a guardian ad litem to

represent all claimants whose identities are unknown. The reasonable fees and expenses of the

guardian, including all reasonable expert witness fees, must be paid by the dissolved limited-

liability partnership.

(e) A dissolved limited-liability partnership that provides security in the amount and form

ordered by the court under subsection (a) of this section satisfies the partnership's obligations with

respect to claims that are contingent, have not been made known to the partnership, or are based on

an event occurring after the date of dissolution, and such claims may not be enforced against a

partner or transferee on account of assets received in liquidation.

7-12.1-810. Liability of partner and person dissociated as partner when claim against

partnership barred.

If a claim against a dissolved partnership is barred under §§ 7-12.1-807, 7-12.1-808, or 7-

12.1-809, any corresponding claim under §§ 7-12.1-306, 7-12.1-703, or 7-12.1-805 is also barred.

ARTICLE 9

LIMITED-LIABILITY PARTNERSHIP

7-12.1-901. Statement of qualification.

(a) A partnership may become a limited-liability partnership pursuant to this section.

(b) The terms and conditions on which a partnership becomes a limited-liability partnership

must be approved by the affirmative vote or consent necessary to amend the partnership agreement

except, in the case of a partnership agreement that expressly addresses obligations to contribute to

the partnership, the affirmative vote or consent necessary to amend those provisions.

a limited-liability partnership by delivering to the secretary of state for filing a statement of

qualification. The statement must contain:

(1) The name of the partnership which must comply with § 7-12.1-902;

(2) The street and mailing addresses of the partnership's principal office and, if different,

the street address of an office in this state, if any;

(3) The name and street and mailing addresses in this state of the partnership's registered

agent; and

(4) A statement that the partnership elects to become a limited-liability partnership.

(d) A partnership's status as a limited-liability partnership remains effective, regardless of

changes in the partnership, until it is canceled pursuant to subsection (f) of this section or

administratively revoked pursuant to § 7-12.1-903.

(e) The status of a partnership as a limited-liability partnership and the protection against

liability of its partners for the debts, obligations, or other liabilities of the partnership while it is a

limited-liability partnership is not affected by errors or later changes in the information required to

be contained in the statement of qualification.

(f) A limited-liability partnership may amend or cancel its statement of qualification by

delivering to the secretary of state for filing a statement of amendment or cancellation. The

statement must be approved by the affirmative vote or consent of all the partners and state the name

of the limited-liability partnership and in the case of:

(1) An amendment, state the text of the amendment; and

(2) A cancellation, state that the statement of qualification is canceled.

7-12.1-902. Permitted names.

(a) The name of a partnership that is not a limited-liability partnership may not contain the

phrase "Registered Limited-liability Partnership" or "Limited-liability Partnership" or the

abbreviation "R.L.L.P.", "L.L.P.", "RLLP" , or "LLP".

(b) The name of a limited-liability partnership must contain the phrase "Registered

Limited-liability Partnership" or "Limited-liability Partnership" or the abbreviation "R.L.L.P.",

"L.L.P.", "RLLP", or "LLP".

liability partnership may register to do business in this state, must be distinguishable on the records

of the secretary of state from any:

(1) Name of an existing person whose formation or qualifications required the filing of a

record by the secretary of state or any name that is filed, reserved, or registered under this title or

as permitted by the laws of this state, subject to the following:

(i) This provision does not apply if the applicant files with the secretary of state a certified

copy of a final decree of a court of competent jurisdiction establishing the prior right of the

applicant to the use of the name in this state; and

(ii) The name may be the same as the name of an existing person the certificate of

incorporation or organization of which has been revoked by the secretary of state as permitted by

law, and the revocation has not been withdrawn within one year from the date of the revocation.

(iii) Words and/or abbreviations that are required by statute to identify the particular type

of business entity shall be disregarded when determining if a name is distinguishable upon the

records of the secretary of state.

(iv) The secretary of state shall promulgate rules and regulations defining the term

"distinguishable upon the record" for the administration of this chapter.

7-12.1-902.1. Fictitious business name.

(a) Any domestic or foreign limited-liability partnership formed under the laws of, or

registered to do business in this state may transact business in this state under a fictitious name

provided that it files a fictitious business name statement in accordance with this section prior to

the time it commences to conduct business under the fictitious name.

(b) A fictitious business name statement shall be filed with the secretary of state, and shall

be signed by a person authorized or required under this chapter to sign a record, and shall state:

(1) The fictitious business name to be used; and

(2) The name of the applicant limited-liability partnership or foreign limited-liability

partnership, and the state and date of its formation.

abandonment of use of a fictitious business name registered in accordance with this section or upon

the cancellation of the domestic limited-liability partnership or the withdrawal of registration of the

foreign limited-liability partnership.

(d) The statement of abandonment of use of a fictitious business name under this section

shall be filed with the secretary of state, shall be executed in the same manner provided in

subsection (2) (b) of this section, and shall state:

(1) The fictitious business name being abandoned;

(2) The date on which the original fictitious business name statement being abandoned was

filed; and

(3) The information presented in subsection (b) of this section.

(e) No domestic or foreign limited-liability partnership transacting business under a

fictitious business name contrary to the provisions of this section, or its assignee, may maintain any

action upon or on account of any contract made, or transaction had, in the fictitious business name

in any court of the state until a fictitious business name statement has been filed in accordance with

this section.

(f) No domestic or foreign limited-liability partnership may be permitted to transact

business under a fictitious business name pursuant to this section that is the same as the name of an

existing person whose registration or qualification required the filing of a record by the secretary

of state or any name that is filed, reserved, or registered under this title or as permitted by the laws

of this state, subject to the following:

(1) This provision does not apply if the applicant files with the secretary of state a certified

copy of a final decree of a court of competent jurisdiction establishing the prior right of the

applicant to the use of the name in this state; and

(2) The name may be the same as the name of an existing person the certificate of

incorporation or organization of which has been revoked by the secretary of state as permitted by

law, and the revocation has not been withdrawn within one year from the date of the revocation.

(3) Words and/or abbreviations that are required by statute to identify the particular type

of business entity shall be disregarded when determining if a name is distinguishable upon the

records of the secretary of state.

(4) The secretary of state shall promulgate rules and regulations defining the term

"distinguishable upon the record" for the administration of this chapter.

7-12.1-903. Administrative revocation of statement of qualification.

(a) The statement of qualification of a limited-liability partnership may be revoked by the

secretary of state under the conditions prescribed in this section when it is established that:

(1) The limited-liability partnership procured its statement of qualification through fraud;

(2) The limited-liability partnership has continued to exceed or abuse the authority

conferred upon it by law;

(3) The limited-liability partnership has failed to file its annual report within the time

required by this chapter;

(4) The limited-liability partnership has failed to pay any required fees to the secretary of

state when they have become due and payable;

(5) The secretary of state has received notice from the division of taxation, in accordance

with § 7-12.1-915, that the limited-liability partnership has failed to pay any fees or taxes due this

state;

(6) The limited-liability partnership has failed for thirty (30) days to appoint and maintain

a registered agent in this state as required by this chapter;

(7) The limited-liability partnership has failed, after change of its registered agent, to file

in the office of the secretary of state a statement of the change as required by this chapter;

(8) The limited-liability partnership has failed to file in the office of the secretary of state

any amendment to its statement of qualification or any articles of dissolution, cancellation

statement, merger, or consolidation as prescribed by this chapter; or

(9) A misrepresentation has been made of any material matter in any application, report,

affidavit, or other document submitted by the limited-liability partnership pursuant to this chapter.

(b) No certificate of a limited-liability partnership shall be revoked by the secretary of state

unless:

(1) The secretary of state shall have given the limited-liability partnership notice thereof

not less than sixty (60) days prior to such revocation by regular mail addressed to the registered

agent in this state on file with the secretary of state's office, which notice shall specify the basis for

the revocation; provided, however, that if a prior mailing addressed to the address of the registered

agent of the limited-liability partnership in this state currently on file with the secretary of state's

office has been returned as undeliverable by the United States Postal Service for any reason, or if

the revocation notice is returned as undeliverable by the United States Postal Service for any reason,

the secretary of state shall give notice as follows:

(i) To the limited-liability partnership at its principal office of record as shown in its most

recent annual report, and no further notice shall be required; or

(ii) In the case of a limited-liability partnership that has not yet filed an annual report, then

to the limited-liability partnership at the principal office in the statement of qualification of limited-

liability partnership and no further notice shall be required; and

(2) The limited-liability partnership fails prior to revocation to file the annual report, pay

the fees or taxes, file the required statement of change of registered agent, file any amendments to

its statement of qualification or articles of dissolution, cancellation statement, merger, or

consolidation, or correct the misrepresentation.

7-12.1-903.1. Issuance of certificates of revocation.

(a) Upon revoking any such certificate of a limited-liability partnership, the secretary of

state shall:

(1) Issue a certificate of revocation in duplicate;

(2) File one of the certificates in the secretary of state's office;

(3) Send to the limited-liability partnership by regular mail a certificate of revocation,

addressed to the registered agent of the limited-liability partnership in this state on file with the

secretary of state's office; provided, however, that if a prior mailing addressed to the address of the

registered agent of the limited-liability partnership in this state currently on file with the secretary

of state's office has been returned to the secretary of state as undeliverable by the United States

Postal Service for any reason, or if the revocation certificate is returned as undeliverable to the

secretary of state's office by the United States Postal Service for any reason, the secretary of state

shall give notice as follows:

(i) To the limited-liability partnership at its principal office of record as shown in its most

recent annual report, and no further notice shall be required; or

(ii) In the case of a limited-liability partnership that has not yet filed an annual report, then

to the domestic limited-liability company at the principal office in the articles of organization or to

the authorized person listed on the articles of organization, and no further notice shall be required.

(b) An administrative revocation under this section affects only the partnership’s status as

a limited-liability partnership and is not an event causing dissolution of the partnership.

registered agent.

7-12.1-904. Reinstatement.

(a) A partnership whose statement of qualification has been revoked administratively under

§ 7-12.1-903 may apply to the secretary of state for reinstatement of the statement of qualification

not later than two (2) years after the effective date of the revocation. The application must be

accompanied by a certificate of good standing from the Rhode Island division of taxation and state:

(1) The name of the partnership at the time of the administrative revocation of its statement

of qualification and, if needed, a different name that satisfies § 7-12.1-902;

(2) The address of the principal office of the partnership and the name and street and

mailing addresses of its registered agent;

(3) The effective date of administrative revocation of the partnership's statement of

qualification;

(4) On the payment by the limited-liability partnership of a penalty in the amount of fifty

dollars ($50.00) for each year or part of year that has elapsed since the issuance of the certificate

of revocation; and

(5) That the grounds for revocation did not exist or have been cured.

(b) To have its statement of qualification reinstated, a partnership must pay all fees, taxes,

interest, and penalties that were due to the secretary of state or tax administrator at the time of the

administrative revocation and all fees, taxes, interest, and penalties that would have been due to the

secretary of state or tax administrator while the partnership's statement of qualification was revoked

administratively.

section contains the required information, is satisfied that the information is correct, and determines

that all payments required to be made to the secretary of state by subsection (b) of this section have

been made, the secretary of state shall:

(1) Cancel the statement of revocation and prepare a statement of reinstatement that states

the secretary of state's determination and the effective date of reinstatement; and

(2) File the statement of reinstatement and serve a copy on the partnership.

(d) When reinstatement under this section has become effective, the following rules apply:

(1) The reinstatement relates back to and takes effect as of the effective date of the

administrative revocation.

(2) The partnership's status as a limited-liability partnership continues as if the revocation

had not occurred.

(3) The rights of a person arising out of an act or omission in reliance on the revocation

before the person knew or had notice of the reinstatement are not affected.

7-12.1-905. Judicial review of denial of reinstatement.

(a) If the secretary of state denies a partnership's application for reinstatement following

administrative revocation of the partnership's statement of qualification, the secretary of state shall

serve the partnership with a notice in a record that explains the reasons for the denial.

(b) A partnership may seek judicial review of denial of reinstatement in the Providence

County superior court not later than thirty (30) days after service of the notice of denial.

7-12.1-906. Reservation of name.

(a) A person may reserve the exclusive use of a name that complies with § 7-12.1-902 by

delivering an application to the secretary of state for filing. The application must state the name

and address of the applicant and the name to be reserved. If the secretary of state finds that the

name is available, the secretary of state shall reserve the name for the applicant's exclusive use for

one hundred twenty (120) days.

(b) The owner of a reserved name may transfer the reservation to another person by

delivering to the secretary of state a signed notice in a record of the transfer which states the name

and address of the person to which the reservation is being transferred.

7-12.1-907. Registration of name.

(a) A foreign limited-liability partnership not registered to do business in this state under

Article 10 of this chapter may register its name, or an alternate name adopted pursuant to § 7-12.1-

902, if the name is distinguishable on the records of the secretary of state from the names that are

not available under § 7-12.1-902.

(b) To register its name or an alternate name adopted pursuant to § 7-12.1-902, a foreign

limited-liability partnership must deliver to the secretary of state for filing an application stating

the partnership's name, the jurisdiction and date of its formation, and any alternate name adopted

pursuant to § 7-12.1-902. If the secretary of state finds that the name applied for is available, the

secretary of state shall register the name for the applicant's exclusive use.

registration.

(d) A foreign limited-liability partnership whose name registration is effective may renew

the registration for successive one-year periods by delivering, not earlier than three (3) months

before the expiration of the registration, to the secretary of state for filing a renewal application that

complies with this section. When filed, the renewal application renews the registration for a

succeeding one-year period.

(e) A foreign limited-liability partnership whose name registration is effective may register

as a foreign limited-liability partnership under the registered name or consent in a signed record to

the use of that name by another person that is not an individual.

7-12.1-908. Registered agent.

(a) Each limited-liability partnership and each registered foreign limited-liability

partnership shall designate and maintain a registered agent in this state. The designation of a

registered agent is an affirmation of fact by the partnership or foreign partnership that the agent has

consented to serve.

(b) A registered agent for a limited-liability partnership or registered foreign limited-

liability partnership must be an existing person and have a place of business in this state.

chapter are:

(1) To forward to the limited-liability partnership or registered foreign limited-liability

partnership at the address most recently supplied to the agent by the partnership or foreign

partnership any process, notice, or demand pertaining to the partnership or foreign partnership

which is served on or received by the agent;

(2) If the registered agent resigns, to provide the notice required by § 7-12.1-907(c) to the

partnership or foreign partnership at the address most recently supplied to the agent by the

partnership or foreign partnership; and

(3) To keep current the information with respect to the agent in the statement of

qualification or foreign registration statement.

7-12.1-909. Change of registered agent or address for registered agent by limited-

liability partnership.

(a) A limited-liability partnership or registered foreign limited-liability partnership may

change its registered agent or the address of its registered agent by delivering to the secretary of

state for filing a statement of change that states:

(1) The name of the partnership or foreign partnership; and

(2) The information that is to be in effect as a result of the filing of the statement of change.

(b) The partners of a limited-liability partnership need not approve the delivery to the

secretary of state for filing of:

(1) A statement of change under this section; or

(2) A similar filing changing the registered agent or registered office, if any, of the

partnership in any other jurisdiction.

affirmation of fact by the limited-liability partnership or registered foreign limited-liability

partnership that the agent has consented to serve.

7-12.1-910. Resignation of registered agent.

(a) A registered agent may resign as an agent for a limited-liability partnership or registered

foreign limited-liability partnership by delivering to the secretary of state for filing a statement of

resignation that states:

(1) The name of the partnership or foreign partnership;

(2) The name of the agent;

(3) That the agent resigns from serving as registered agent for the partnership or foreign

partnership; and

(4) The address of the partnership or foreign partnership to which the agent will send the

notice required by subsection (c) of this section.

(b) A statement of resignation takes effect on the earlier of:

(1) The thirty-first day after the day on which it is filed by the secretary of state; or

(2) The designation of a new registered agent for the limited-liability partnership or

registered foreign limited-liability partnership.

registered foreign limited-liability partnership notice in a record of the date on which a statement

of resignation was filed.

(d) When a statement of resignation takes effect, the registered agent ceases to have

responsibility under this chapter for any matter thereafter tendered to it as agent for the limited-

liability partnership or registered foreign limited-liability partnership. The resignation does not

affect any contractual rights the partnership or foreign partnership has against the agent or that the

agent has against the partnership or foreign partnership.

(e) A registered agent may resign with respect to a limited-liability partnership or registered

foreign limited-liability partnership whether or not the partnership or foreign partnership is in good

standing.

7-12.1-911. Change of name or address by registered agent.

(a) If a registered agent changes its name or address, the agent may deliver to the secretary

of state for filing a statement of change that states:

(1) The name of the limited-liability partnership or registered foreign limited-liability

partnership represented by the registered agent;

(2) The name of the agent as currently shown in the records of the secretary of state for the

partnership or foreign partnership;

(3) If the name of the agent has changed, its new name; and

(4) If the address of the agent has changed, its new address.

(b) A registered agent promptly shall furnish notice to the represented limited-liability

partnership or registered foreign limited-liability partnership of the filing by the secretary of state

of the statement of change and the changes made by the statement.

7-12.1-912. Service of process, notice, or demand.

(a) A limited-liability partnership or registered foreign limited-liability partnership may be

served with any process, notice, or demand required or permitted by law by serving its registered

agent.

(b) If a limited-liability partnership or registered foreign limited-liability partnership fails

to appoint or maintain a registered agent in this state, or whenever its registered agent cannot with

reasonable diligence be found at the registered office, then the secretary of state is an agent of the

corporation upon whom any process, notice, or demand may be served. Service on the secretary of

state of any process, notice, or demand is made by delivering to and leaving with him or her or with

any clerk having charge of the corporation department of his or her office, duplicate copies of the

process, notice, or demand. In the event any process, notice, or demand is served on the secretary

of state, the secretary of state shall immediately forward one of the copies by certified mail,

addressed to the corporation at its registered office. Any service upon the secretary of state is

returnable in not less than thirty (30) days.

of the plaintiff and defendant, the title, docket number and nature of the proceeding in which

process has been served upon the secretary of state, the fact that service has been effected pursuant

to this subsection, the return date thereof, and the day and hour when the service was made. The

secretary of state shall not be required to retain such information for a period longer than five (5)

years from receipt of the service of process.

(d) Service of process, notice, or demand on a registered agent must be in a written record.

(e) Service of process, notice, or demand may be made by other means under law other

than this chapter.

7-12.1-913. Annual report for secretary of state.

(a) A limited-liability partnership or registered foreign limited-liability partnership shall

deliver to the secretary of state for filing an annual report that states:

(1) The name of the partnership or registered foreign partnership;

(2) The street and mailing addresses of its principal office;

(3) The name of at least one partner;

(4) In the case of a foreign partnership, its jurisdiction of formation and any alternate name

adopted under § 7-12.1-1006;

(5) A brief statement of the character of the business in which the limited-liability

partnership is actually engaged in this state; and

(6) Any additional information that is required by the secretary of state.

(b) The annual report must be made on forms prescribed and furnished by the secretary of

state, and the information in the annual report must be current as of the date the report is signed by

the limited-liability partnership or registered foreign limited-liability partnership.

before May 1, of the year following the calendar year in which the limited-liability partnership's

statement of qualification became effective or the registered foreign limited-liability partnership

registered to do business in this state. Subsequent annual reports must be filed with the secretary of

state after February 1, and before May 1, of each calendar year thereafter. Proof to the satisfaction

of the secretary of state that prior to May 1 the report was deposited in the United States mail in a

sealed envelope, properly addressed, with postage prepaid, is deemed to be a compliance with this

requirement.

(d) If the secretary of state finds that the annual report conforms to the requirements of this

chapter, the secretary of state shall file the report. If an annual report does not contain the

information required by this section, the secretary of state promptly shall notify the reporting

limited-liability partnership or registered foreign limited-liability partnership in a record and return

the report for correction, in which event the penalties subsequently prescribed for failure to file the

report within the time previously provided do not apply if the report is corrected to conform to the

requirements of this chapter and returned to the secretary of state within thirty (30) days from the

date on which it was mailed to the corporation by the secretary of state.

(e) Each limited-liability partnership, domestic or foreign, that fails or refuses to file its

annual report for any year within thirty (30) days after the time prescribed by this chapter is subject

to a penalty of twenty-five dollars ($25.00) per year.

7-12.1-914. Filing of returns with the tax administrator -- annual charge.

(a) For tax years beginning on or after January 1, 2012, a limited-liability partnership

registered under § 7-12-56, shall file a return in the form and containing the information as

prescribed by the tax administrator as follows:

(1) If the fiscal year of the limited-liability partnership is the calendar year, on or before

the fifteenth day of April in the year following the close of the fiscal year; and

(2) If the fiscal year of the limited-liability partnership is not a calendar year, on or before

the fifteenth day of the fourth month following the close of the fiscal year.

(b) For tax years beginning after December 31, 2015, a limited-liability partnership

registered under § 7-12-56 or this chapter, shall file a return, in the form and containing the

information as prescribed by the tax administrator, and shall be filed on or before the date a federal

tax return is due to be filed, without regard to extension.

11-2(e), shall be due on the filing of the limited-liability partnership's return filed with the tax

administrator and shall be paid to the division of taxation.

(d) The annual charge is delinquent if not paid by the due date for the filing of the return

and an addition of one hundred dollars ($100) to the charge is then due.

7-12.1-915. Confirmation of state fees and taxes.

(a) Notwithstanding any other provisions of the Rhode Island general laws, when any

section of this chapter refers to state fees and/or taxes paid, the division of taxation is authorized to

respond and share tax information with the secretary of state’s office in response to a request from

that office regarding an entity’s tax status as compliant or noncompliant.

(b) If the secretary of state’s office receives notice from the division of taxation that the

limited-liability partnership has failed to pay any fees or taxes due this state, the secretary of state

shall begin revocation proceedings in accordance with the provisions of § 7-12.1-903.

to pay state fees and/or taxes to the division of taxation. However, the secretary of state’s office

must otherwise protect all state and federal tax information in its custody as required by § 7-12.1-

915 and refrain from disclosing any other specific tax information.

7-12.1-916. Revocation of certificate of limited-liability partnership or certificate of

registration for nonpayment of fee fees or taxes.

(a) The tax administrator may, after July 15 of each year, compile a list of all limited-

liability partnerships that have failed to pay any state fees and/or taxes for one year after the fees

and/or taxes became due and payable, and the failure is not the subject of a pending appeal. The

tax administrator shall certify to the correctness of the list. Upon receipt of the certified list, the

secretary of state may initiate revocation proceedings as defined in § 7-12.1-903.

(b) With respect to any information provided by the division of taxation to the secretary of

state’s office pursuant to this chapter, the secretary of state, together with the employees or agents

thereof, shall be subject to all state and federal tax confidentiality laws applying to the division of

taxation and the officers, agents, and employees thereof, and which restrict the acquisition, use,

storage, dissemination, or publication of confidential taxpayer data.

revocation that the taxpayer has failed to pay state fees and/or taxes to the division of taxation.

However, the secretary of state’s office must otherwise protect all state and federal tax information

in its custody as required by subsection (b) of this section and refrain from disclosing any other

specific tax information.

ARTICLE 10

FOREIGN LIMITED-LIABILITY PARTNERSHIP

7-12.1-1001. Governing law.

(a) The law of the jurisdiction of formation of a foreign limited-liability partnership

governs:

(1) The internal affairs of the partnership; and

(2) The liability of a partner as partner for a debt, obligation, or other liability of the foreign

partnership.

(b) A foreign limited-liability partnership is not precluded from registering to do business

in this state because of any difference between the law of its jurisdiction of formation and the law

of this state.

not authorize the foreign partnership to engage in any business or exercise any power that a limited-

liability partnership may not engage in or exercise in this state.

7-12.1-1002. Registration to do business in this state.

(a) A foreign limited-liability partnership may not do business in this state until it registers

with the secretary of state under this article.

(b) A foreign limited-liability partnership doing business in this state may not maintain an

action or proceeding in this state unless it has registered to do business in this state.

state does not impair the validity of a contract or act of the foreign partnership or preclude it from

defending an action or proceeding in this state.

(d) A limitation on the liability of a partner of a foreign limited-liability partnership is not

waived solely because the foreign partnership does business in this state without registering to do

business in this state.

(e) Sections 7-12.1-1001(a) and 7-12.1-1001(b) applies even if a foreign limited-liability

partnership fails to register under this article.

7-12.1-1003. Foreign registration statement.

To register to do business in this state, a foreign limited-liability partnership must deliver

a foreign registration statement to the secretary of state for filing. The statement must state:

(1) The name of the partnership and, if the name does not comply with § 7-12.1-902, an

alternate name adopted pursuant to § 7-12.1-1006(a);

(2) That the partnership is a foreign limited-liability partnership;

(3) The partnership's jurisdiction of formation;

(4) The general character of the business it proposes to transact in this state;

(5) The name and business address of at least one partner;

(6) The street and mailing addresses of the partnership's principal office and, if the law of

the partnership's jurisdiction of formation requires the partnership to maintain an office in that

jurisdiction, the street and mailing addresses of the required office;

(7) The name and street and mailing addresses of the partnership's registered agent in this

state;

(8) A statement that the secretary of state is appointed the agent of a foreign limited-liability

partnership for service of process if no agent has been appointed, or, if appointed, the agent’s

authority has been revoked or if the agent cannot be found or served with the exercise of reasonable

diligence; and

(9) Additional information as may be necessary or appropriate in order to enable the

secretary of state to determine whether the foreign limited-liability partnership is entitled to a

certificate of authority to transact business in this state.

7-12.1-1004. Amendment of foreign registration statement.

A registered foreign limited-liability partnership shall deliver to the secretary of state for

filing an amendment to its foreign registration statement if there is a change in:

(1) The name of the partnership;

(2) The alternate name adopted pursuant to § 7-12.1-1006(a);

(3) The address required by § 7-12.1-1003(6).

7-12.1-1005. Activities not constituting doing business.

(a) Activities of a foreign limited-liability partnership which do not constitute doing

business in this state under this article include:

(1) Maintaining, defending, mediating, arbitrating, or settling an action or proceeding;

(2) Carrying on any activity concerning its internal affairs, including holding meetings of

its partners;

(3) Maintaining accounts in financial institutions;

(4) Maintaining offices or agencies for the transfer, exchange, and registration of securities

of the partnership or maintaining trustees or depositories with respect to those securities;

(5) Selling through independent contractors;

(6) Soliciting or obtaining orders by any means if the orders require acceptance outside this

state before they become contracts;

(7) Creating or acquiring indebtedness, mortgages, or security interests in property;

(8) Securing or collecting debts or enforcing mortgages or security interests in property

securing the debts and holding, protecting, or maintaining property;

(9) Conducting an isolated transaction that is not in the course of similar transactions;

(10) Owning, without more, property; and

(11) Doing business in interstate commerce.

(b) A person does not do business in this state solely by being a partner of a foreign limited-

liability partnership that does business in this state.

foreign limited-liability partnership to service of process, taxation, or regulation under law of this

state other than this chapter.

7-12.1-1006. Noncomplying name of foreign limited-liability partnership.

(a) A foreign limited-liability partnership whose name does not comply with § 7-12.1-902

may not register to do business in this state until it adopts, for the purpose of doing business in this

state, an alternate name that complies with § 7-12.1-902. A partnership that registers under an

alternate name under this subsection need not comply with §§ 7-16-902 or 7-1.2-402. A partnership

that registers under an alternate name under this subsection need not comply with this state’s

fictitious name statute. After registering to do business in the state with an alternate name, a

partnership shall do business in this state under:

(1) The alternate name;

(2) The partnership's name, with the addition of its jurisdiction of formation; or

(3) A name the partnership is authorized to use under the state's fictitious name statute to

include, but not be limited to, §§ 7-16- 902.1 or 7-1.2-402.

(b) If a registered foreign limited-liability partnership changes its name to one that does

not comply with § 7-12.1-902, it may not do business in this state until it complies with subsection

(a) of this section by amending its registration to adopt an alternate name that complies with § 7-

12.1-902.

7-12.1-1007. Withdrawal deemed on conversion to domestic filing entity or domestic

limited-liability partnership.

A registered foreign limited-liability partnership that converts to a domestic limited-

liability partnership or to a domestic entity whose formation requires the delivery of a record to the

secretary of state for filing is deemed to have withdrawn its registration on the effective date of the

conversion.

7-12.1-1008. Withdrawal on dissolution or conversion to nonfiling entity other than

limited-liability partnership.

(a) A registered foreign limited-liability partnership that has dissolved and completed

winding up or has converted to a domestic or foreign entity whose formation does not require the

public filing of a record, other than a limited-liability partnership, shall deliver a statement of

withdrawal to the secretary of state for filing. The statement must state:

(1) In the case of a partnership that has completed winding up:

(i) Its name and jurisdiction of formation;

(ii) That the partnership surrenders its registration to do business in this state;

(iii) That the limited-liability partnership revokes the authority of its registered agent in

this state to accept service of process and consents that service of process in any action, suit, or

proceeding based upon any cause of action arising in this state during the time the limited-liability

partnership was authorized to transact business in this state may subsequently be made on the

limited-liability partnership by service on the secretary of state in accordance with subsection (b)

of this section; and

(iv) The post office address to which the secretary of state may mail a copy of any process

against the limited-liability partnerships that is served on the secretary of state.

(2) In the case of a partnership that has converted:

(i) The name of the converting partnership and its jurisdiction of formation;

(ii) The type of entity to which the partnership has converted and its jurisdiction of

formation;

(iii) That the converted entity surrenders the converting partnership's registration to do

business in this state and revokes the authority of the converting partnership's registered agent to

act as registered agent in this state on behalf of the partnership or the converted entity; and

(iv) A mailing address to which service of process may be made under subsection (b) of

this section.

(b) After a withdrawal under this section becomes effective, service of process in any action

or proceeding based on a cause of action arising during the time the foreign limited-liability

partnership was registered to do business in this state may be made pursuant to § 7-12.1-912.

7-12.1-1009. Transfer of registration.

(a) When a registered foreign limited-liability partnership has merged into a foreign entity

that is not registered to do business in this state or has converted to a foreign entity required to

secretary of state for filing an application for transfer of registration. The application must state:

(1) The name of the registered foreign limited-liability partnership before the merger or

conversion;

(2) That before the merger or conversion the registration pertained to a foreign limited-

liability partnership;

(3) The name of the applicant foreign entity into which the foreign limited-liability

partnership has merged or to which it has been converted and, if the name does not comply with §

7-12.1-902, an alternate name adopted pursuant to § 7-12.1-1006(a);

(4) The type of entity of the applicant foreign entity and its jurisdiction of formation;

(b) An application for authority to transact business in the state of Rhode Island for the

resulting entity type and a certificate of legal existence or good standing issued by the proper officer

of the state or country under the laws of which the resulting entity has been formed.

foreign limited-liability limited partnership to do business in this state is transferred without

interruption to the foreign entity into which the partnership has merged or to which it has been

converted.

7-12.1-1010. Revocation of registration.

(a) The registration of a foreign limited-liability partnership may be revoked by the

secretary of state under the conditions prescribed in this section when it is established that:

(1) The limited-liability partnership procured its certificate of registration through fraud;

(2) The limited-liability partnership has continued to exceed or abuse the authority

conferred upon it by law;

(3) The limited-liability partnership has failed to file its annual report within the time

required by this chapter;

(4) The limited-liability partnership has failed to pay any required fees to the secretary of

state when they have become due and payable;

(5) The limited-liability partnership has failed for thirty (30) days to appoint and maintain

a registered agent in this state as required by this chapter;

(6) The limited-liability partnership has failed, after change of its registered agent, to file

in the office of the secretary of state a statement of the change as required by this chapter;

(7) The limited-liability partnership has failed to file in the office of the secretary of state

any amendment to its certificate of registration or any articles of dissolution, merger, or

consolidation as prescribed by this chapter; or

(8) A misrepresentation has been made of any material matter in any application, report,

affidavit, or other document submitted by the limited-liability partnership pursuant to this chapter.

(b) No certificate of registration of a limited-liability partnership shall be revoked by the

secretary of state unless:

(1) The secretary of state shall have given the limited-liability partnership notice thereof

not less than sixty (60) days prior to such revocation by regular mail addressed to the registered

agent in this state on file with the secretary of state's office, which notice shall specify the basis for

the revocation; provided, however, that if a prior mailing addressed to the address of the registered

agent of the limited-liability partnership in this state currently on file with the secretary of state's

office has been returned as undeliverable by the United States Postal Service for any reason, or if

the revocation notice is returned as undeliverable by the United States Postal Service for any reason,

the secretary of state shall give notice as follows:

(i) To the limited-liability partnership at its principal office of record as shown in its most

recent annual report, and no further notice shall be required; or

(ii) In the case of a limited-liability partnership that has not yet filed an annual report, then

to the limited-liability partnership at the principal office in the certificate of registration of limited-

liability partnership and no further notice shall be required; and

(2) The limited-liability partnership fails prior to revocation to file the annual report, pay

the fees or taxes, file the required statement of change of registered agent, file the amendment to

its registration or certificate of withdrawal of registration, merger, or consolidation, or correct the

misrepresentation.

7-12.1-1011. Issuance of certificates of revocation.

(a) Upon revoking any such certificate of registration of limited-liability partnership, the

secretary of state shall: