Texas Business Organizations Code 10.055 – General Effect of Interest Exchange
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Terms Used In Texas Business Organizations Code 10.055
- Interest exchange: means the acquisition of an ownership or membership interest in a domestic entity as provided by Subchapter Texas Business Organizations Code 1.002
- Membership interest: means a member's interest in an entity. See Texas Business Organizations Code 1.002
- Organization: means a corporation, limited or general partnership, limited liability company, business trust, real estate investment trust, joint venture, joint stock company, cooperative, association, bank, insurance company, credit union, savings and loan association, or other organization, regardless of whether the organization is for-profit, nonprofit, domestic, or foreign. See Texas Business Organizations Code 1.002
- Plan of exchange: means a document that conforms with the requirements of § 10. See Texas Business Organizations Code 1.002
When an interest exchange takes effect:
(1) the ownership or membership interest of each acquired organization is exchanged as provided in the plan of exchange, and the former owners or members whose interests are exchanged under the plan of exchange are entitled only to the rights provided in the plan of exchange or, if applicable, a right to receive the fair value for the ownership interests provided under Subchapter H; and
(2) the acquiring organization has all rights, title, and interests with respect to the ownership or membership interest to be acquired by it subject to the provisions of the plan of exchange.