Memorandum of Changes Made After the End of the CBA Partnership Committee's Minutes

Anthony van Westrum, P.C.

SECTION 7-64-103.  Effect of partnership agreement; nonwaivable provisions. (1)  To the extent the partnership agreement does not otherwise provide, this article governs relations among the partners and between the partners and the partnership.

(2) The partnership agreement may not:

(a) Vary the rights and duties under section 7-64-105 except to eliminate the duty to provide copies of statements to all of the partners;

(b) Unreasonably restrict the right of access to books and records under section 7-64-403(2) or unreasonably limit the obligations of the partners or the partnership under section 7-64-403(3);

(c) Eliminate any of the duties specified in section 7-64-404(1)(a), (b), or (c) or in section 7-64-603(2)(c), but:

(I) The partnership agreement may identify types or categories of activities that do not violate the any of the duties specified in section 7-64-404(1)(a), (b), or (c), if not unconscionable manifestly unreasonable; or

(II) All of the partners or a number or percentage specified in the partnership agreement may authorize or ratify, after full disclosure of all material facts, an act or transaction that otherwise would violate the any of the duties specified in section 7-64-404(1)(a), (b), or (c);

(d) Unreasonably reduce the duty of care under section 7-64-404(3) or 7-64-603(2)(c);

(e) Eliminate the obligation of good faith and fair dealing under section 7-64-404(3), but the partnership agreement may prescribe the standards by which the performance of the obligation is to be measured, if the standards are not unconscionable manifestly unreasonable.;

(f) Vary the power to dissociate as a partner under section 7-64-602(1), except to require the notice under section 7-64-601(1) to be in writing;

(g) Vary the right of a court to expel a partner in the events specified in section 7-64-601(5);

(h) Vary the requirement to wind up the partnership business in cases specified in section 7-64-801(4), (5), or (6);

(i) Restrict rights of third persons under this article; or

(j) Vary the law applicable to limited liability partnerships as set forth in section 7-64-106(3).

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SECTION 7-64-404.  General standards of partner's conduct. (1)  The duties a partner owes to the partnership and the other partners, in addition to those established elsewhere in this article, include the duties to:

(a) Account to the partnership and hold as trustee for it any property, profit, or benefit derived by the partner in the conduct or winding up of the partnership business or derived from a use by the partner of partnership property, including the appropriation of a partnership opportunity;

(b) Refrain from dealing with the partnership in the conduct or winding up of the partnership business as or on behalf of a party having an interest adverse to the partnership;

(c) Refrain from competing with the partnership in the conduct of the partnership business before the dissolution of the partnership; and

(d) Comply with the provisions of the partnership agreement.

(2) A partner owes to the partnership and the other partners a duty of care in the conduct and winding up of the partnership business which shall be limited to refraining from engaging in grossly negligent or reckless conduct, intentional misconduct, or a knowing violation of law.

(3) A partner shall discharge the partner's duties to the partnership and the other partners and exercise any rights consistently with the obligation of good faith and fair dealing.

(4) A partner does not violate a duty or obligation to the partnership or the other partners solely because the partner's conduct furthers the partner's own interest. A partner shall not be liable to the partnership or the other partners for the partner's good faith reliance on the provisions of the partnership agreement.

(5) A partner may lend money to and transact other business with the partnership, and as to each loan or transaction the rights and obligations of the partner may be exercised or performed in the same manner as those of a person who is not a partner, subject to other applicable law.

(6) If a partnership is formed, the duties a partner owes to the partnership and the other partners pertain to all transactions connected with the formation, conduct, or liquidation of the partnership.

(7) This section applies to a person winding up the partnership business as the personal or legal representative of the last surviving partner as if the person were a partner.

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SECTION 7-64-603. Effect of partner's dissociation. (1) If a partner's dissociation results in a dissolution and winding up of the partnership business, part 8 of this article 64 applies; otherwise, part 7 of this article 64 applies.

(2) Upon a partner's dissociation:

(a) The partner's right to participate in the management and conduct of the partnership business terminates, except as otherwise provided in section 7-64-803;

(b) The partner's duties under section 7-64-404(1)(c) terminates; and

(c) The partner's duties under subsections (1)(a), (1)(b), and (2) of 7-64-404 continue only with regard to matters arising and events occurring before the partner's dissociation, unless the partner participates in winding up the partnership's business pursuant to section 7-64-803.

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SECTION 7-64-801.  Events causing dissolution and winding up of partnership business. A partnership is dissolved, and its business must be wound up, only upon the occurrence of any of the following events:

(1) In a partnership at will, the partnership's having notice from a partner, other than a partner who is dissociated under section 7-64-601(2) through (10), of that partner's express will to withdraw as a partner, except that, if the partnership has notice that the partner's will is to withdraw at a later date, then the dissolution shall occur at the later date specified by the partner;

(2) In a partnership for a definite term or particular undertaking:

(a) The expiration of Within ninety days after a partner's wrongful dissociation by death or otherwise under section 7-64-601(6) through (10) or wrongful 602(2) or a partner's dissociation by death or otherwise under section 7-64-602(2), unless before that time a majority in interest 601(6) through (10), the express will of at least half of the remaining partners agree to continue the partnership to wind up the partnership business, for which purpose a partner's rightful dissociation, pursuant to section 7-64-602(2)(b)(I), constitutes the expression of that partner's will;

(b) The express will of all of the partners to wind up the partnership business; or

(c) The expiration of the term or the completion of the undertaking;

(3) An event agreed to in the partnership agreement resulting in the winding up of the partnership business;

(4) An event that makes it unlawful for all or substantially all of the business of the partnership to be continued, but a cure of illegality within ninety days after the partnership has notice of the event is effective retroactively to the date of the event for purposes of this section;

(5) On application by a partner, a judicial determination that:

(a) The economic purpose of the partnership is likely to be unreasonably frustrated;

(b) 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;

(c) It is not otherwise reasonably practicable to carry on the partnership business in conformity with the partnership agreement; or

(d) The partnership is not reasonably likely to pay liabilities against which it indemnifies the dissociated partner;

(6) On application by a transferee of a partner's transferable interest, a judicial determination that it is equitable to wind up the partnership business:

(a) 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

(b) 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.

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SECTION 7-64-1003.  Name. (1)   The name of each limited liability partnership as set forth in its registration statement and the name of each limited liability limited partnership as set forth in its certificate of limited partnership or registration statement:

(a) Shall, in the case of a limited liability partnership, contain the words "limited liability partnership" or "registered limited liability partnership" or the abbreviation "L.L.P.", or "LLP", "R.L.L.P.", or "RLLP," and, in the case of a limited liability limited partnership, contain the words "limited liability limited partnership" or "registered limited liability limited partnership" or the abbreviation "L.L.L.P.", or "LLLP""R.L.L.L.P.", or "RLLLP".;

(b) Shall be deemed to be in compliance with section 7-62-102(1)(a) if its name is in compliance with subsection (1)(a) of this section.

(2) Except as authorized by subsection (3) of this section, the name of a limited liability partnership or a limited liability limited partnership shall not be the same as or deceptively similar to:

(a) The corporate name of any domestic corporation or domestic nonprofit corporation;

(b) The name of any domestic limited partnership, domestic limited liability partnership, or domestic limited liability limited partnership, as set forth in its certificate of limited partnership or registration statement on file with the secretary of state;

(c) The name of any domestic limited partnership association as set forth in its articles of association on file with the secretary of state;

(d) The name of any domestic limited liability company as set forth in its articles of organization on file with the secretary of state;

(e) The name under which any foreign corporation, foreign nonprofit corporation, foreign limited partnership, foreign limited liability company, foreign limited liability partnership, foreign limited liability limited partnership, or foreign limited partnership association is authorized to transact business in or is registered in this state;

(f) The corporate name of any foreign corporation or foreign nonprofit corporation, the company name of any foreign limited liability company, or the association name of any foreign limited partnership association if such name is registered with the secretary of state pursuant to the laws of this state;

(g) A name the exclusive right to which is reserved with the secretary of state under the laws of this state;

(h) Any trade name or assumed name that is registered with the secretary of state by another person pursuant to section 7-71-101;

(i) The corporate name, assumed name, or trade name of a dissolved corporation during the one-hundred-twenty-day period following the effective date of such corporation's dissolution: or

(j) Any trademark registered with the secretary of state by another person pursuant to section 7-70-102.

(3) A limited liability partnership may apply to the secretary of state for authorization to use a name, or may deliver for filing a registration statement that states a name, that is the same as or deceptively similar to a name otherwise not available pursuant to subsection (2) of this section if the limited liability partnership delivers to the secretary of state for filing either:

(a) The written consent of the other holder of the name to use the same or a deceptively similar name if one or more words are added, altered, or deleted to make the name distinguishable on the records of the secretary of state from the other name; or

(b) A certified copy of a final decree of a court of competent jurisdiction establishing the prior right of the limited liability partnership to the use of such name in this state.