AB 1802

Bill Subjects

Abstract

Existing law, the California Revised Uniform Limited Liability Company Act, authorizes one or more persons to form a limited liability company by, among other things, signing and delivering articles of organization to the Secretary of State. Under existing law, a limited liability company is a member-managed limited liability company unless the articles of organization contain a statement that the limited liability company is to be manager managed. Existing law provides for filing a certificate of cancellation of the articles of organization in specified circumstances. Existing law, except as specified, authorizes managers or specified other persons, as applicable, to wind up the affairs of the limited liability company. Existing law provides that a limited liability company that has filed a certificate of cancellation continues to exist for limited purposes, including the purpose of winding up its affairs. Existing law requires those persons winding up the affairs of the limited liability company to give written notice of the commencement of winding up by mail to creditors and claimants. Existing law requires that any assets inadvertently or otherwise omitted from the winding up continue in the canceled limited liability company for the benefit of the persons entitled to those assets upon cancellation, and, on realization, be distributed accordingly. Existing law, except as specified, requires the managers of a limited liability company or certain other persons, as applicable, to file with the Secretary of State a certificate of cancellation of articles of organization upon the completion of the winding up of the affairs of the limited liability company under existing law. This bill would specifically require that omitted assets be used to discharge unsatisfied liabilities, if any, known to the company, and that any excess be distributed to the members. If assets are omitted from the winding up, the bill would authorize any person authorized to wind up the affairs of a limited liability company that has filed a certificate of cancellation to use the assets to discharge the liabilities of the limited liability company and distribute any remaining assets to the members. The bill would correct certain cross-references relating to the dissolution, distribution, and winding up procedures.