Mergers of Unincorporated Associations

Corporations Code Title 3, Part 1, Chapter 6, Article 5 deals with mergers of unincorporated associations in this state.

Section 18350 defines the following terms: “constituent entity,” “disappearing entity,” and “surviving entity.”

Section 18360 allows an unincorporated association to merge with a domestic or foreign corporation, limited partnership, general partnership, or limited liability company.

Section 18370 explains that a merger involving an unincorporated association is subject to the seven specified requirements. The principal terms of the merger agreement are approved by the board, the members, and any person whose approval is required by the association’s governing documents.

Section 18380 specifies that a merger pursuant to this article has three specified effects. All rights of creditors and all liens on or arising from the property of each of the constituent entities are preserved unimpaired, provided that a lien on property of a disappearing entity is limited to the property subject to the lien immediately before the merger is effective.

Section 18390 says that if, as a consequence of merger, a surviving entity succeeds to ownership of real property located in this state, the surviving entity’s record ownership of that property may be evidenced by recording in the county in which the property is located a copy of the agreement of merger.

Section 18400 states that a bequest, devise, gift, grant, or promise contained in a will or other instrument of donation, subscription, or conveyance that is made to a disappearing entity and that takes effect or remains payable after the merger inures to the benefit of the surviving entity.