Tex. Bus. Orgs. Code Section 153.404
Determination by Independent Persons


(a)

A determination of how to proceed on allegations made in a demand or petition relating to a derivative proceeding must be made by an affirmative vote of the majority of:

(1)

the independent and disinterested general partners of the limited partnership, whether one or more, even if the independent and disinterested general partners are not a majority of the general partners of the limited partnership;

(2)

a committee consisting of one or more independent and disinterested general partners appointed by a majority of one or more independent and disinterested general partners of the limited partnership, even if the appointing independent and disinterested general partners are not a majority of the general partners of the limited partnership; or

(3)

a panel of one or more independent and disinterested individuals appointed by the court on a motion by the limited partnership listing the names of the individuals to be appointed and stating that, to the best of the limited partnership’s knowledge, the individuals to be appointed are disinterested and qualified to make the determinations contemplated by Section 153.408 (Dismissal of Derivative Proceeding).

(b)

An entity to which this subsection applies is independent and disinterested under this section only if its decision with respect to the limited partnership’s derivative proceeding is made by a majority of its governing persons who are independent and disinterested with respect to that derivative proceeding, even if those governing persons are not a majority of its governing persons. This subsection applies to an entity that is:

(1)

a general partner of the limited partnership; or

(2)

directly, or indirectly through one or more other entities, a governing person of that general partner.

(c)

The court shall appoint a panel under Subsection (a)(3) if the court finds that the individuals recommended by the limited partnership are independent and disinterested and are otherwise qualified with respect to expertise, experience, independent judgment, and other factors considered appropriate by the court under the circumstances to make the determinations. An individual appointed by the court to a panel under this section may not be held liable to the limited partnership or the limited partnership’s partners for an action taken or omission made by the individual in that capacity, except for an act or omission constituting fraud or wilful misconduct.
Acts 2003, 78th Leg., ch. 182, Sec. 1, eff. Jan. 1, 2006.
Amended by:
Acts 2019, 86th Leg., R.S., Ch. 899 (H.B. 3603), Sec. 28, eff. September 1, 2019.

Source: Section 153.404 — Determination by Independent Persons, https://statutes.­capitol.­texas.­gov/Docs/BO/htm/BO.­153.­htm#153.­404 (accessed Mar. 23, 2024).

153.001
Definition
153.002
Construction
153.003
Applicability of Other Laws
153.005
Waiver or Modification of Rights of Third Parties
153.051
Required Amendment to Certificate of Formation
153.052
Discretionary Amendment to Certificate of Formation
153.101
Admission of Limited Partners
153.102
Liability to Third Parties
153.103
Actions Not Constituting Participation in Business for Liability Purposes
153.104
Enumeration of Actions Not Exclusive
153.105
Creation of Rights
153.106
Erroneous Belief of Contributor Being Limited Partner
153.107
Statement Required for Liability Protection
153.108
Requirements for Liability Protection Following Expiration of Statement
153.109
Liability of Erroneous Contributor
153.110
Withdrawal of Limited Partner
153.111
Distribution on Withdrawal
153.112
Receipt of Wrongful Distribution
153.113
Powers of Estate of Limited Partner Who Is Deceased or Incapacitated
153.151
Admission of General Partners
153.152
General Powers and Liabilities of General Partner
153.153
Powers and Liabilities of Person Who Is Both General Partner and Limited Partner
153.154
Contributions by and Distributions to General Partner
153.155
Withdrawal of General Partner
153.156
Notice of Event of Withdrawal
153.157
Withdrawal of General Partner in Violation of Partnership Agreement
153.158
Effect of Withdrawal
153.159
Conversion of Partnership Interest After Withdrawal
153.160
Effect of Conversion of Partnership Interest
153.161
Liability of General Partner for Debt Incurred After Event of Withdrawal
153.162
Liability for Wrongful Withdrawal
153.201
Form of Contribution
153.202
Enforceability of Promise to Make Contribution
153.203
Release of Obligation to Partnership
153.204
Enforceability of Obligation
153.205
Requirements to Enforce Conditional Obligation
153.206
Allocation of Profits and Losses
153.207
Right to Distribution
153.208
Sharing of Distributions
153.209
Interim Distributions
153.210
Limitation on Distribution
153.251
Assignment of Partnership Interest
153.252
Rights of Assignor
153.253
Rights of Assignee
153.254
Liability of Assignee
153.255
Liability of Assignor
153.256
Partner’s Partnership Interest Subject to Charging Order
153.257
Exemption Laws Applicable to Partnership Interest Not Affected
153.301
Periodic Report
153.302
Form and Contents of Report
153.303
Filing Fee
153.304
Delivery of Report
153.305
Action by Secretary of State
153.306
Effect of Filing Report
153.307
Effect of Failure to File Report
153.308
Notice of Forfeiture of Right to Transact Business
153.309
Effect of Forfeiture of Right to Transact Business
153.310
Revival of Right to Transact Business
153.311
Termination of Certificate or Revocation of Registration After Forfeiture
153.312
Reinstatement of Certificate of Formation or Registration
153.351
Requirements
153.352
Applicability of Other Requirements
153.353
Law Applicable to Partners
153.401
Definitions
153.402
Standing to Bring Proceeding
153.403
Demand
153.404
Determination by Independent Persons
153.405
Stay of Proceeding
153.406
Discovery
153.407
Tolling of Statute of Limitations
153.408
Dismissal of Derivative Proceeding
153.409
Allegations After Demand Rejected
153.410
Discontinuance or Settlement
153.411
Payment of Expenses
153.412
Application to Foreign Limited Partnerships
153.413
Closely Held Limited Partnership
153.501
Cancellation or Revocation of Event Requiring Winding Up
153.502
Winding up Procedures
153.503
Powers of Person Conducting Wind up
153.504
Disposition of Assets
153.505
Approval of Reinstatement
153.551
Records
153.552
Examination of Records
153.553
Execution of Filings
153.554
Execution, Amendment, or Cancellation by Judicial Order
153.555
Permitted Transfer in Connection with Racetrack License
153.5521
Penalty for Refusal to Permit Examination of Certain Records

Accessed:
Mar. 23, 2024

§ 153.404’s source at texas​.gov