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Limited partnerships are created under, and governed by, state statutes.
The corporate existence typically begins when the articles of incorporation are signed.
Some states require limited liability partner- ships to carry liability insurance to protect
the partners from bad investments.
Because the corporation is a separate entity, the corporation itself is liable for any debts
and obligations it incurs.
Due diligence work is completed after the closing of mergers and acquisitions.
Creditors of the partnership may look to the personal property of partners in the event
that partnership assets are insufficient to cover a debt.
A partnership agreement may provide for an unequal distribution of the assets of the
partner- ship to the partners upon dissolution of the partnership.
The laws of the foreign state subject the foreign corporation to many of the same duties
and restrictions applicable to domestic corporations and regulate the internal affairs of
the corporation.
With the possible exception of statutory close corporations, all business corporations
are required to elect a board of directors and to have a board of directors at all times.
Directors may be removed by the officers of the corporation.
Corporations that give notice of dissolution to creditors are afforded the same protection
from future claims as the dissolving corporation that does not give notice.
The issuer of securities has the option of regis- tering the securities under the provisions
of the Securities Act of 1933 or the Securities Ex- change Act of
The partnership agreement may specify that one partner has the right to manage the
business of the partnership.
Partners act as agents for the partnership and the other partners.
A corporation may be a partner of a limited partnership.
Unlike the stock exchanges, over-the-counter markets are not subject to federal
regulation.
Both the Securities Act of 1933 and the Securities Exchange Act of 1934 contain
antifraud provisions.
Limited partners are granted the same rights as general partners of a general
partnership.
