Iowa Code 486A.906 – Effect of merger
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1. When a merger takes effect all of the following apply:
a. The separate existence of every partnership or limited partnership that is a party to the merger, other than the surviving entity, ceases.
b. All property owned by each of the merged partnerships or limited partnerships vests in the surviving entity.
c. All obligations of every partnership or limited partnership that is a party to the merger become the obligations of the surviving entity.
d. An action or proceeding pending against a partnership or limited partnership that is a party to the merger may be continued as if the merger had not occurred, or the surviving entity may be substituted as a party to the action or proceeding.
Terms Used In Iowa Code 486A.906
- following: when used by way of reference to a chapter or other part of a statute mean the next preceding or next following chapter or other part. See Iowa Code 4.1
- Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
- 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.
- Partnership: means an association of two or more persons to carry on as co-owners a business for profit formed under section 486A. See Iowa Code 486A.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.
- Property: means all property, real, personal, or mixed, tangible or intangible, or any interest in such property. See Iowa Code 486A.101
- Service of process: The service of writs or summonses to the appropriate party.
- State: means a state, territory, or possession of the United States, the District of Columbia, or the Commonwealth of Puerto Rico. See Iowa Code 486A.101
- Statute: A law passed by a legislature.
2. The secretary of state of this state is the agent for service of process in an action or proceeding against a surviving foreign partnership or limited partnership to enforce an obligation of a domestic partnership or limited partnership that is a party to a merger. The surviving entity shall promptly notify the secretary of state of the mailing address of its chief executive office and of any change of address. Upon receipt of process, the secretary of state shall mail a copy of the process to the surviving foreign partnership or limited partnership.
3. A partner of the surviving partnership or limited partnership is liable for all of the following:
a. All obligations of a party to the merger for which the partner was personally liable before the merger.
b. All other obligations of the surviving entity incurred before the merger by a party to the merger, but those obligations may be satisfied only out of property of the surviving entity.
c. Except as otherwise provided in section 486A.306, all obligations of the surviving entity incurred after the merger takes effect, but those obligations may be satisfied only out of property of the surviving entity if the partner is a limited partner.
4. If the obligations incurred before the merger by a party to the merger are not satisfied out of the property of the surviving partnership or limited partnership, the general partners of that party immediately before the effective date of the merger shall contribute the amount necessary to satisfy that party’s obligations to the surviving entity, in the manner provided in section 486A.807 or in chapter 488 or under the law of the jurisdiction in which the party was formed, as the case may be, as if the merged party were dissolved.
5. A partner of a party to a merger who does not become a partner of the surviving partnership or limited partnership is dissociated from the entity, of which that partner was a partner, as of the date the merger takes effect. The surviving entity shall cause the partner’s interest in the entity to be purchased under section 486A.701 or another statute specifically applicable to that partner’s interest with respect to a merger. The surviving entity is bound under section 486A.702 by an act of a general partner dissociated under this subsection, and the partner is liable under section 486A.703 for transactions entered into by the surviving entity after the merger takes effect.