§ 23-0.6-3-6 — Effect of interest exchange

Indiana § 23-0.6-3-6

• Jurisdiction: Indiana
• Title 23: BUSINESS AND OTHER ASSOCIATIONS
• Art. 0.6: UNIFORM BUSINESS ORGANIZATION
• Ch. 3: Interest Exchange

Text

(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 plan of interest exchange and
to any appraisal rights they have under IC 23-0.6-1-8 and the
acquired entity's organic law;
(2) the acquiring entity becomes the interest holder of the
interests in the acquired entity stated in the plan 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 articles 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 plan
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 business
corporation or nonprofit 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, governing person, 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 under this chapter becomes effective,
a foreign entity that is the surviving entity may be served with process
in this state for the collection and enforcement of any debts,
obligations, or other liabilities of a domestic exchanging entity in
accordance with applicable law.
(e) 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 subdivision (1) as if the interest
exchange had not occurred.
(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 subdivision (1) as if the interest
exchange had not occurred.

Legislative History

As added by P.L.118-2017, SEC.6.