(a)  When a domestication becomes effective:

(1)  The domesticated entity is:

(i)  Organized under and thereafter subject to the organic law of the domesticated entity; and

(ii)  The same entity without interruption as the domesticating entity;

(2)  All property of the domesticating entity continues to be vested in the domesticated entity without transfer, reversion, or impairment;

(3)  All debts, obligations, and other liabilities of the domesticating entity continue as debts, obligations, and other liabilities of the domesticated entity;

(4)  Except as otherwise provided by law or the plan of domestication, all the rights, privileges, immunities, powers, and purposes of the domesticating entity remain in the domesticated entity;

(5)  The name of the domesticated entity may be substituted for the name of the domesticating entity in any pending action or proceeding;

(6)  The statement of qualification of the domesticated entity becomes effective;

(7)  The provisions of the partnership agreement of the domesticated entity that are to be in a record, if any, approved as part of the plan of domestication become effective; and

(8)  The interests in the domesticating entity are converted to the extent and as approved in connection with the domestication, and the partners of the domesticating entity are entitled only to the rights provided to them under the plan of domestication and to any appraisal rights they have under § 7-12.1-1106.

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Terms Used In Rhode Island General Laws 7-12.1-1156

  • Appraisal: A determination of property value.
  • Business: includes every trade, occupation, and profession. See Rhode Island General Laws 7-12.1-102
  • Domesticating limited liability partnership: means the domestic limited liability partnership that approves a plan of domestication pursuant to Rhode Island General Laws 7-12.1-1101
  • Domestication: means a transaction authorized by Rhode Island General Laws 7-12.1-1101
  • 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 Rhode Island General Laws 7-12.1-102
  • Interest: means :

    (i)  A share in a business corporation;

    (ii)  A membership in a nonprofit corporation;

    (iii)  A partnership interest in a general partnership;

    (iv)  A partnership interest in a limited partnership;

    (v)  A membership interest in a limited liability company;

    (vi)  A share in a general cooperative association;

    (vii)  A member's interest in a limited cooperative association;

    (viii)  A membership in an unincorporated nonprofit association;

    (ix)  A beneficial interest in a statutory trust, business trust, or common-law business trust; or

    (x)  A governance interest or distributional interest in any other type of unincorporated entity. See Rhode Island General Laws 7-12.1-1101

  • Interest holder: means :

    (i)  A shareholder of a business corporation;

    (ii)  A member of a nonprofit corporation;

    (iii)  A general partner of a general partnership;

    (iv)  A general partner of a limited partnership;

    (v)  A limited partner of a limited partnership;

    (vi)  A member of a limited liability company;

    (vii)  A shareholder of a general cooperative association;

    (viii)  A member of a limited cooperative association;

    (ix)  A member of an unincorporated nonprofit association;

    (x)  A beneficiary or beneficial owner of a statutory trust, business trust, or common-law business trust; or

    (xi)  Any other direct holder of an interest. See Rhode Island General Laws 7-12.1-1101

  • Interest holder liability: means :

    (i)  Personal liability for a liability of an entity which is imposed on a person:

    (A)  Solely by reason of the status of the person as an interest holder; or

    (B)  By the organic rules of the entity which make one or more specified interest holders or categories of interest holders liable in their capacity as interest holders for all or specified liabilities of the entity; or

    (ii)  An obligation of an interest holder under the organic rules of an entity to contribute to the entity. See Rhode Island General Laws 7-12.1-1101

  • Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
  • Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
  • Organic law: means the law of an entity's jurisdiction of formation governing the internal affairs of the entity. See Rhode Island General Laws 7-12.1-1101
  • Partner: means a person that:

    (i)  Has become a partner in a partnership under Rhode Island General Laws 7-12.1-102

  • Partnership: A voluntary contract between two or more persons to pool some or all of their assets into a business, with the agreement that there will be a proportional sharing of profits and losses.
  • 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 Rhode Island General Laws 7-12.1-102
  • 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. See Rhode Island General Laws 7-12.1-102
  • Plan: means a plan of merger, plan of interest exchange, plan of conversion, or plan of domestication. See Rhode Island General Laws 7-12.1-1101
  • Plan of domestication: means a plan under Rhode Island General Laws 7-12.1-1101
  • Property: means all property, whether real, personal, or mixed or tangible or intangible, or any right or interest therein. See Rhode Island General Laws 7-12.1-102
  • Registered foreign entity: means a foreign entity that is registered to do business in this state pursuant to a record filed by the secretary of state. See Rhode Island General Laws 7-12.1-1101
  • 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. See Rhode Island General Laws 7-12.1-102
  • 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. See Rhode Island General Laws 7-12.1-102

(b)  Except as otherwise provided in the organic law or partnership agreement of the domesticating limited liability partnership, the domestication does not give rise to any rights that a partner or third party would otherwise have upon a dissolution, liquidation, or winding up of the domesticating partnership.

(c)  When a domestication becomes effective, a person that did not have interest holder liability with respect to the domesticating limited liability partnership and becomes subject to interest holder liability with respect to a domestic limited liability partnership as a result of the domestication has interest holder liability only to the extent provided by this chapter and only for those debts, obligations, and other liabilities that are incurred after the domestication becomes effective.

(d)  When a domestication becomes effective, the interest holder liability of a person that ceases to hold an interest in a domestic domesticating limited liability partnership with respect to which the person had interest holder liability is subject to the following rules:

(1)  The domestication does not discharge any interest holder liability under this chapter to the extent the interest holder liability was incurred before the domestication became effective.

(2)  A person does not have interest holder liability under this chapter for any debt, obligation, or other liability that is incurred after the domestication becomes effective.

(3)  This chapter continues to apply to the release, collection, or discharge of any interest holder liability preserved under subsection (d)(1) of this section as if the domestication had not occurred.

(4)  A person has whatever rights of contribution from any other person as are provided by this chapter, law other than this chapter, or the partnership agreement of the domestic domesticating limited liability partnership with respect to any interest holder liability preserved under subsection (d)(1) of this section as if the domestication had not occurred.

(e)  When a domestication becomes effective, a foreign limited liability partnership that is the domesticated partnership may be served with process in this state for the collection and enforcement of any of its debts, obligations, and other liabilities as provided in § 7-12.1-119.

(f)  If the domesticating limited liability partnership is a registered foreign entity, the registration of the partnership is canceled when the domestication becomes effective.

(g)  A domestication does not require a domestic domesticating limited liability partnership to wind up its business and does not constitute or cause the dissolution of the partnership.

History of Section.
P.L. 2022, ch. 123, § 2, effective January 1, 2023; P.L. 2022, ch. 124, § 2, effective January 1, 2023.