Continuation clause

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A continuation clause is a provision in the articles of association of a partnership that, in certain shareholder- related constellations that result in the dissolution of the company according to the law, orders the departure of the shareholder concerned from the company, which is continued by the remaining shareholders.

A society under civil law (GbR) is u. a. through the termination of the company by a partner (Sections 723, 724 BGB) or by the attachment creditor of a partner (Section 725 (1) BGB), the death of a partner ( Section 727 BGB ) and the opening of insolvency proceedings over the assets of a partner (Section 728 (2) BGB) dissolved, whereby the winding up of the company is initiated by way of liquidation. The continuation clause modifies this legal consequence in such a way that the shareholder concerned, with whom the company can no longer be operated in the aforementioned constellations, leaves the company that is continued by the remaining shareholders. The further legal consequences result from §§ 738 to 740 BGB; In this respect, the severance payment claim to which the resigning partner (or his heirs) is entitled under Section 738 (1) sentence 2 of the German Civil Code (BGB) is to be named, through which the resigning partner (or his heirs) is to be placed as it is in the law envisaged case of the dissolution of the company. The debtor of this claim is society; the remaining partners are exceptionally personally liable for this, although the company liability results from the company relationship.

In a general partnership (OHG) or limited partnership (KG) one (separates (personally liable) partner with his death from § 131 1 III no., § 161 para. 2 HGB ). Its share in the company grows with the other shareholders ( Section 105 (3) HGB in conjunction with Section 738 (1) sentence 1 BGB), the company is not dissolved. A continuation clause is therefore not necessary for these types of company.

Entry clause

A so-called entry clause, on the other hand, grants the shareholder's heir the right to join the company. The entry clause represents a real contract in favor of third parties , in which the departing partner is the recipient of the promise and the co-partners are the promise. The person named in the articles of association does not become a partner upon death, but only has a contractual right against the other partners to be accepted into the company. As long as the person entitled to enter does not decide to become a partner, the heirs can assert compensation claims in accordance with Section 738 of the German Civil Code (BGB) if such claims are not excluded in the articles of association. On the one hand, they would allow capital to flow out of the company and, on the other hand, they would deprive the person entitled to enter their capital value of the promised share in the company. In practice, a “trustee solution” is therefore often included in the articles of association, according to which the co-partners manage the deceased partner's share in trust until the person entitled to join has made a decision.

A qualified entry clause is used when the individual person of the entrant is named in the articles of association. This does not necessarily have to be the heir of the deceased partner.

Succession clause

A succession clause makes the share in the company hereditary, so that in the event of the death of the partner, the heir follows by way of universal succession to become the partner. A distinction is made between the simple and the qualified succession clause.

Simple succession clause

The simple succession clause stipulates that in the event of the death of a partner, the company should continue with his heirs. The heir of a partner can, according to Section 139 Paragraph 1 Clause 1 HGB, demand that he be granted the position of a limited partner. If the request of the heir is accepted by the other shareholders, the company becomes a KG. If the shareholders reject the conversion of the company into a KG, the heir acquires a right to termination (Section 139 (2) HGB) and, if the termination is exercised, a claim for compensation in accordance with Section 105 (3) HGB i. V. m. Section 738 (1) BGB.

If several persons are heirs, they inherit as a community of heirs according to the principle of § 2032 BGB . As a joint ownership community, however, a community of heirs cannot be involved in an advertising partnership, which is why the principle of Section 2032 of the German Civil Code (BGB) is broken. There is a special succession in which each heir becomes a partner and can dispose of his share in the company alone.

Qualified succession clause

A qualified succession clause makes the succession in the company shares dependent on the characteristics or the identity of the heir, such as ancestry or a professional qualification. The non-qualified co-heirs then have a right to compensation against the qualified heir if the partner dies. This can be prevented by a division order according to § 2048 BGB or an advance legacy according to § 2150 BGB in the will of the partner. If the qualified successor clause fails because the person identified by it does not become an heir, it can be interpreted into a qualified entry clause in favor of the named person by means of reinterpretation according to § 140 BGB.

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