Dissolution of an LLC

Corporations Code Title 2.6, Article 7 deals with the dissolution and winding up of a limited liability company under the California Revised Uniform LLC Act.

Section 17707.01 provides that a limited liability company is dissolved and its activities are wound up upon the happening of the first of three specified events to occur.

Section 17707.02 states that, if a domestic limited liability company has not conducted any business, 50% or more of the voting interests of the members, or, if there are no members, 50% or more of the voting interests of the managers, if any, may execute and acknowledge a certificate of cancellation of articles of organization, on a form prescribed by the Secretary of State, stating all eight specified items.

Section 17707.03 provides that, pursuant to an action filed by any manager or by any member or members of a limited liability company, a court of competent jurisdiction may decree the dissolution of a limited liability company whenever any of the five specified events occur.

Section 17707.04 explains that, in the event of a dissolution of a limited liability company, the three specified procedures are to be followed.

Section 17707.05 states that, after determining that all the known debts and liabilities of a limited liability company in the process of winding up, including, without limitation, debts and liabilities to members who are creditors of the limited liability company, have been paid or adequately provided for, the remaining assets are to be distributed among the members according to their respective rights and preferences as specified.

Section 17707.06 provides that a limited liability company that has filed a certificate of cancellation nevertheless continues to exist for the purpose of winding up its affairs, prosecuting and defending actions by or against it in order to collect and discharge obligations, disposing of and conveying its property, and collecting and dividing its assets.

Section 17707.07 allows causes of action against a dissolved limited liability company, whether arising before or after the dissolution of the limited liability company, to be enforced against any of the specified entities. Summons or other process against a limited liability company may be served by delivering a copy thereof to a manager, member, officer, or person having charge of its assets or.

Section 17707.08 requires the managers to sign and file in the office of, and on a form prescribed by, the Secretary of State, a certificate of dissolution upon the dissolution of the limited liability company pursuant to this article, with exceptions. The certification has to set forth at least three specified items. The certificate of cancellation of articles of organization must set forth four specified items. The Secretary of State notifies the Franchise Tax Board of the filing.

Section 17707.09 states that a majority of the members may cause to be filed, in the office of, and on a form prescribed by, the Secretary of State, a certificate of continuation, in any of the three specified circumstances. The certificate of continuation must set forth two specified items.