Texas Senate Bill SB748

Texas 2011 - 82nd Regular

• Introduced: 2/16/11
• Out of Senate Committee: 3/7/11
• Voted on by Senate: 3/17/11
• Refer: 2/23/11
• Out of House Committee: 4/29/11
• Report Pass: 3/7/11
• Voted on by House: 5/5/11
• Engrossed: 3/17/11
• Governor Action: 5/27/11
• Refer: 4/4/11
• Report Pass: 4/20/11
• Enrolled: 5/11/11
• Passed: 5/27/11

Caption

Relating to business entities and associations.

Impact

The bill directly impacts Texas state law governing the activities and operations of business entities. By clarifying terms and reducing ambiguity regarding merger and conversion procedures, SB748 promotes efficiency in business transactions. The modifications will allow entities to operate with better legal backing, thus potentially lowering litigation risks associated with mergers or ownership exchanges. Additionally, the provisions aim to reassess the liability of partnerships and corporations, particularly about the responsibilities of governing persons in transactions involving conflicts of interest.

Summary

SB748, pertinent to business entities and associations in Texas, seeks to amend several sections of the Business Organizations Code aimed at streamlining the processes for mergers, conversions, and exchanges among various business entities. The bill introduces definitions for key concepts such as 'national securities exchange' and updates the framework regarding plans for mergers and conversions, enhancing clarity and legal consistency in business operations. These updates are vital for facilitating smoother transitions in business ownership and structure, addressing existing shortcomings in the current legal framework.

Contention

While the bill is generally viewed as a means to modernize and simplify the governance of business entities, there may be contention around the degree of control or responsibility placed on governing persons during mergers and acquisitions. Details regarding transparency in transactions where conflicts of interest may occur are critical and could be points of debate among stakeholders. Different stakeholders, including business owners, lawyers, and legislators, might have perceptible divisions on the implications of these changes, particularly around liability and the level of protection afforded to minority shareholders or partners.