(a) When a conversion becomes effective:

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Terms Used In Tennessee Code 61-3-1115

  • Appraisal: A determination of property value.
  • Conversion: means a transaction authorized by §. See Tennessee Code 61-3-1101
  • Converted entity: means the converting entity as the converting entity continues in existence after a conversion. See Tennessee Code 61-3-1101
  • Converting entity: means the domestic entity that approves a plan of conversion pursuant to §. See Tennessee Code 61-3-1101
  • Interest: means :
    (A) A share in a business corporation. See Tennessee Code 61-3-1101
  • Interest holder: means :
    (A) A shareholder of a business corporation. See Tennessee Code 61-3-1101
  • Interest holder liability: means :
    (A) Personal liability for a liability of an entity that is imposed on a person:
    (i) Solely by reason of the status of the person as an interest holder. See Tennessee Code 61-3-1101
  • 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 Tennessee Code 61-3-1101
  • Organic rules: means the public organic record and private organic rules of an entity. See Tennessee Code 61-3-1101
  • Partner: means a limited partner or general partner. See Tennessee Code 61-3-101
  • 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.
  • Person: means an individual, business corporation, nonprofit corporation, partnership, limited partnership, limited liability company, 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 Tennessee Code 61-3-101
  • Plan: means a plan of merger, plan of conversion, or plan of domestication. See Tennessee Code 61-3-1101
  • Plan of conversion: means a plan under §. See Tennessee Code 61-3-1101
  • Property: means all property, whether real, personal, mixed, or tangible or intangible, or any right or interest in such property. See Tennessee Code 61-3-101
  • Record: when 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. See Tennessee Code 61-3-101
  • 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 Tennessee Code 61-3-1101
  • 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 Tennessee Code 61-3-101
  • Transfer: includes :
    (A) An assignment. See Tennessee Code 61-3-101
(1) The converted entity is:

(A) Organized under and subject to the organic law of the converted entity; and
(B) The same entity without interruption as the converting entity;
(2) All property of the converting entity continues to be vested in the converted entity without transfer, reversion, or impairment;
(3) All debts, obligations, and other liabilities of the converting entity continue as debts, obligations, and other liabilities of the converted entity;
(4) Except as otherwise provided by law or the plan of conversion, all the rights, privileges, immunities, powers, and purposes of the converting entity remain in the converted entity;
(5) The name of the converted entity may be substituted for the name of the converting entity in any pending action or proceeding;
(6) The certificate of limited partnership of the converted entity becomes effective;
(7) The provisions of the partnership agreement of the converted entity that are to be in a record, if any, approved as part of the plan of conversion become effective; and
(8) The interests in the converting entity are converted, and the interest holders of the converting entity are entitled only to the rights provided to them under the plan of conversion and to any appraisal rights they have under § 61-3-1103.
(b) Except as otherwise provided in the partnership agreement of a domestic converting limited partnership, the conversion does not give rise to any rights that a partner or third party would have upon a dissolution, liquidation, or winding up of the converting entity.
(c) When a conversion becomes effective, a person that did not have interest holder liability with respect to the converting entity and becomes subject to interest holder liability with respect to a domestic entity as a result of the conversion has interest holder liability only to the extent provided by the organic law of the entity and only for those debts, obligations, and other liabilities that are incurred after the conversion becomes effective.
(d) When a conversion becomes effective, the interest holder liability of a person that ceases to hold an interest in a domestic converting limited partnership with respect to which the person had interest holder liability is subject to the following:

(1) The conversion does not discharge any interest holder liability under this chapter to the extent the interest holder liability was incurred before the conversion became effective;
(2) The person does not have interest holder liability under this chapter for any debt, obligation, or other liability that is incurred after the conversion becomes effective;
(3) This chapter continues to apply to the release, collection, or discharge of any interest holder liability preserved under subdivision (d)(1) as if the conversion had not occurred; and
(4) The person has whatever rights of contribution from any other person as are provided by this chapter, law other than this chapter or the organic rules of the converting entity with respect to any interest holder liability preserved under subdivision (d)(1) as if the conversion had not occurred.
(e) When a conversion becomes effective, a foreign entity that is the converted entity 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 § 61-3-119.
(f) If the converting entity is a registered foreign entity, its registration to do business in this state is cancelled when the conversion becomes effective.
(g) A conversion does not require the entity to wind up its affairs and does not constitute or cause the dissolution of the entity.
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