Kansas Statutes 17-78,306. Effect of interest exchange
(a) When an interest exchange becomes effective:
(1) The interests in the acquired entity that are the subject of the interest exchange cease to exist or are converted or exchanged and the interest holders of those interests are entitled only to the rights provided to them under the agreement of interest exchange and to any appraisal rights they have under Kan. Stat. Ann. § 17-78-109, and amendments thereto, and the acquired entity‘s organic law;
Terms Used In Kansas Statutes 17-78,306
- Acquired entity: means the entity, all of one or more classes or series of interests in which are acquired in an interest exchange. See Kansas Statutes 17-78,102
- Acquiring entity: means the entity that acquires all of one or more classes or series of interests of the acquired entity in an interest exchange. See Kansas Statutes 17-78,102
- Agreement: means a plan or agreement of merger, interest exchange, conversion or domestication. See Kansas Statutes 17-78,102
- Appraisal: A determination of property value.
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Domestic entity: means an entity whose internal affairs are governed by the law of this state. See Kansas Statutes 17-78,102
- Entity: means :
(1) A corporation;
(2) a general partnership, including a limited liability partnership;
(3) a limited partnership, including a limited liability limited partnership;
(4) a limited liability company;
(5) a business trust or statutory trust entity;
(6) a cooperative; or
(7) any other person that has a separate legal existence or has the power to acquire an interest in real property in its own name other than:
(A) An individual;
(B) a testamentary, inter vivos or charitable trust, with the exception of a business trust, statutory trust entity or similar trust;
(C) an association or relationship that is not a partnership solely by reason of Kan. See Kansas Statutes 17-78,102
- Governor: means a person by or under whose authority the powers of an entity are exercised and under whose direction the business and affairs of the entity are managed pursuant to the organic law and organic rules of the entity. See Kansas Statutes 17-78,102
- Interest: means :
(1) A governance interest in an unincorporated entity;
(2) a transferable interest in an unincorporated entity; or
(3) a share or membership in a corporation. See Kansas Statutes 17-78,102
- Interest exchange: means a transaction authorized by Kan. See Kansas Statutes 17-78,102
- Interest holder: means a direct holder of an interest. See Kansas Statutes 17-78,102
- Interest holder liability: means :
(1) Personal liability for a liability of an entity that is imposed on a person:
(A) Solely by reason of the status of the person as an interest holder; or
(B) by the organic rules of the entity pursuant to a provision of the organic law authorizing the organic rules to make one or more specified interest holders or categories of interest holders liable in their capacity as interest holders for all or specified liabilities of the entity; or
(2) an obligation of an interest holder under the organic rules of an entity to contribute to the entity. See Kansas Statutes 17-78,102
- Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
- Liability: means a debt, obligation or any other liability arising in any manner, regardless of whether it is secured or whether it is contingent. See Kansas Statutes 17-78,102
- Organic law: means the statutes, if any, other than this act, governing the internal affairs of an entity. See Kansas Statutes 17-78,102
- Organic rules: means the public organic document and private organic rules of an entity. See Kansas Statutes 17-78,102
- Person: means an individual, corporation, estate, trust, partnership, limited liability company, business or similar trust, association, joint venture, public corporation, government, or governmental subdivision, agency or instrumentality, or any other legal or commercial entity. See Kansas Statutes 17-78,102
- Public organic document: means the public record the filing of which creates an entity and any amendment to or restatement of that record. See Kansas Statutes 17-78,102
- Record: means information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form. See Kansas Statutes 17-78,102
(2) the acquiring entity becomes the interest holder of the interests in the acquired entity stated in the agreement of interest exchange to be acquired by the acquiring entity;
(3) the public organic document, if any, of the acquired entity is amended as provided in the certificate of interest exchange and is binding on its interest holders; and
(4) the private organic rules of the acquired entity that are to be in a record, if any, are amended to the extent provided in the agreement of interest exchange and are binding on and enforceable by:
(A) Its interest holders; and
(B) in the case of an acquired entity that is not a corporation, any other person that is a party to an agreement that is part of the acquired entity’s private organic rules.
(b) Except as otherwise provided in the organic law or organic rules of the acquired entity, the interest exchange does not give rise to any rights that an interest holder, governor or third party would otherwise have upon a dissolution, liquidation or winding-up of the acquired entity.
(c) When an interest exchange becomes effective, a person that did not have interest holder liability with respect to the acquired entity and that becomes subject to interest holder liability with respect to a domestic entity as a result of the interest exchange has interest holder liability only to the extent provided by the organic law of the entity and only for those liabilities that arise after the interest exchange becomes effective.
(d) When an interest exchange becomes effective, the interest holder liability of a person that ceases to hold an interest in a domestic acquired entity with respect to which the person had interest holder liability is as follows:
(1) The interest exchange does not discharge any interest holder liability under the organic law of the domestic acquired entity to the extent the interest holder liability arose before the interest exchange became effective;
(2) the person does not have interest holder liability under the organic law of the domestic acquired entity for any liability that arises after the interest exchange becomes effective;
(3) the organic law of the domestic acquired entity continues to apply to the release, collection or discharge of any interest holder liability preserved under paragraph (1) as if the interest exchange had not occurred; and
(4) the person has whatever rights of contribution from any other person as are provided by the organic law or organic rules of the domestic acquired entity with respect to any interest holder liability preserved under paragraph (1) as if the interest exchange had not occurred.