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Texas Business Organizations Code - Section 10.362. Computation And Determination Of Fair Value Of Ownership Interest

Legal Research Home > Texas Lawyer > Business Organizations Code > Texas Business Organizations Code - Section 10.362. Computation And Determination Of Fair Value Of Ownership Interest

§ 10.362. COMPUTATION AND DETERMINATION OF FAIR VALUE OF 
OWNERSHIP INTEREST.  (a) For purposes of this subchapter, the fair 
value of an ownership interest of a domestic entity subject to 
dissenters' rights is the value of the ownership interest on the 
date preceding the date of the action that is the subject of the 
appraisal.  Any appreciation or depreciation in the value of the 
ownership interest occurring in anticipation of the proposed action 
or as a result of the action must be specifically excluded from the 
computation of the fair value of the ownership interest.
	(b)  In computing the fair value of an ownership interest 
under this subchapter, consideration must be given to the value of 
the organization as a going concern without including in the 
computation of value any:
		(1)  payment for a control premium or minority discount 
other than a discount attributable to the type of ownership 
interests held by the dissenting owner;  and
		(2)  limitation placed on the rights and preferences of 
those ownership interests.
	(c)  The determination of the fair value of an ownership 
interest made for purposes of this subchapter may not be used for 
purposes of making a determination of the fair value of that 
ownership interest for another purpose or of the fair value of 
another ownership interest, including for purposes of determining 
any minority or liquidity discount that might apply to a sale of an 
ownership interest.

Acts 2003, 78th Leg., ch. 182, § 1, eff. Jan. 1, 2006.                     

Last modified: August 11, 2007