(a) A plan of interest exchange shall not be effective unless it has been approved:

(1) By a domestic acquired entity (A) in accordance with the requirements, if any, in its organic law and organic rules for approval of an exchange of interests; (B) except as otherwise provided in subsection (c) of this section, if neither its organic law nor organic rules provide for approval of an exchange of interests, then in accordance with the requirements, if any, in its organic law and organic rules for approval of a merger, as if the interest exchange were a merger; or (C) if neither its organic law nor organic rules provide for approval of an exchange of interests or a merger, by all of the interest holders of the entity entitled to vote on or consent to any matter; and

(2) In a record, by each interest holder of a domestic acquired entity that shall have interest holder liability for liabilities that arise after the interest exchange becomes effective, unless, in the case of an entity that is not a business corporation, (A) the organic rules of the entity provide in a record for the approval of an interest exchange or a merger in which some or all of its interest holders become subject to interest holder liability by the vote or consent of fewer than all of the interest holders; and (B) the interest holder voted for or consented in a record to such provision of the organic rules or became an interest holder after the adoption of such provision.

(b) An interest exchange involving a foreign acquired entity shall not be effective unless it is approved by the foreign entity in accordance with the law of the foreign entity's jurisdiction of organization.

(c) Except as otherwise provided in its organic law or organic rules, the interest holders of the acquiring entity shall not be required to approve the interest exchange.

(P.A. 11-241, S. 18.)

History: P.A. 11-241 effective January 1, 2014.