CHAPTER 153. LIMITED PARTNERSHIPS

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BUSINESS ORGANIZATIONS CODE

TITLE 4. PARTNERSHIPS

CHAPTER 153. LIMITED PARTNERSHIPS

SUBCHAPTER A. GENERAL PROVISIONS

Sec. 153.001. DEFINITION. In this chapter, "other limited

partnership provisions" means the provisions of Title 1 and

Chapters 151 and 154, to the extent applicable to limited

partnerships.

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

Sec. 153.002. CONSTRUCTION. (a) This chapter and the other

limited partnership provisions shall be applied and construed to

effect its general purpose to make uniform the law with respect

to limited partnerships among states that have similar laws.

(b) The rule that a statute in derogation of the common law is

to be strictly construed does not apply to this chapter and the

other limited partnership provisions.

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

Sec. 153.003. APPLICABILITY OF OTHER LAWS. (a) Except as

provided by Subsection (b), in a case not provided for by this

chapter and the other limited partnership provisions, the

provisions of Chapter 152 governing partnerships that are not

limited partnerships and the rules of law and equity govern.

(b) The powers and duties of a limited partner shall not be

governed by a provision of Chapter 152 that would be inconsistent

with the nature and role of a limited partner as contemplated by

this chapter.

general partner solely by reason of being a limited partner.

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

Sec. 153.004. NONWAIVABLE TITLE 1 PROVISIONS. (a) Except as

provided by this section, the following provisions of Title 1 may

not be waived or modified in the partnership agreement of a

limited partnership:

(1) Chapter 1, if the provision is used to interpret a provision

or define a word or phrase contained in a section listed in this

subsection;

(2) Chapter 2, other than Section 2.104(c)(2), 2.104(c)(3), or

2.113;

(3) Chapter 3, other than Subchapters C and E of that chapter

and Section 3.151 (provided, that in all events a partnership

agreement may not validly waive or modify Sections 153.551 and

153.552); or

(4) Chapter 4, 5, 10, 11, or 12, other than Section 11.058.

(b) A provision listed in Subsection (a) may be waived or

modified in the partnership agreement if the provision that is

waived or modified authorizes the limited partnership to waive or

modify the provision in the limited partnership's governing

documents.

partnership agreement if the provision that is modified

specifies:

(1) the person or group of persons who are entitled to approve a

modification; or

(2) the vote or other method by which a modification is required

to be approved.

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

Sec. 153.005. WAIVER OR MODIFICATION OF RIGHTS OF THIRD PARTIES.

A provision in this title or in that part of Title 1 applicable

to a limited partnership that grants a right to a person, other

than a general partner, a limited partner, or assignee of a

partnership interest in a limited partnership, may be waived or

modified in the partnership agreement of the limited partnership

only if the person consents to the waiver or modification.

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

SUBCHAPTER B. SUPPLEMENTAL PROVISIONS REGARDING AMENDMENT TO

CERTIFICATE OF FORMATION

Sec. 153.051. REQUIRED AMENDMENT TO CERTIFICATE OF FORMATION.

(a) A general partner shall file a certificate of amendment

reflecting the occurrence of one or more of the following events

not later than the 30th day after the date on which the event

occurred:

(1) the admission of a new general partner;

(2) the withdrawal of a general partner;

(3) a change in the name of the limited partnership; or

(4) except as provided by Section 5.202, a change in:

(A) the address of the registered office; or

(B) the name or address of the registered agent of the limited

partnership.

(b) A general partner who becomes aware that a statement in a

certificate of formation was false when made or that a matter

described in the certificate has changed, making the certificate

false in any material respect, shall promptly amend the

certificate to make it accurate.

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

Sec. 153.052. DISCRETIONARY AMENDMENT TO CERTIFICATE OF

FORMATION. (a) A certificate of formation may be amended at any

time for a proper purpose as determined by the general partners.

(b) A certificate of formation may be amended to state the name,

mailing address, and street address of the business or residence

of each person winding up the limited partnership's affairs if,

after an event requiring the winding up of a limited partnership

but before the limited partnership is reconstituted or a

certificate of termination is filed as provided by Section

11.101:

(1) the certificate of formation has been amended to reflect the

withdrawal of all general partners; or

(2) a person who is not shown on the certificate of formation as

a general partner is carrying out the winding up of a limited

partnership's affairs.

(b), each person winding up the limited partnership's affairs

shall execute and file the certificate of amendment. A person

winding up the partnership's affairs is not subject to liability

as a general partner because of the filing of the certificate of

amendment.

(d) A general partner who is not winding up the limited

partnership's affairs is not required to execute and file a

certificate of amendment as provided by this section.

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

Amended by:

Acts 2005, 79th Leg., Ch.

64, Sec. 85, eff. January 1, 2006.

Acts 2007, 80th Leg., R.S., Ch.

688, Sec. 120, eff. September 1, 2007.

Sec. 153.053. RESTATED CERTIFICATE OF FORMATION. (a) The

general partners may adopt at any time a restated certificate of

formation that does not contain an amendment to the certificate

of formation.

(b) A restated certificate of formation that contains an

amendment to the certificate of formation may be adopted at any

time for a proper purpose as determined by the general partners.

Added by Acts 2005, 79th Leg., Ch.

64, Sec. 86, eff. January 1, 2006.

SUBCHAPTER C. LIMITED PARTNERS

Sec. 153.101. ADMISSION OF LIMITED PARTNERS. (a) In connection

with the formation of a limited partnership, a person acquiring a

limited partnership interest becomes a limited partner on the

later of:

(1) the date on which the limited partnership is formed; or

(2) the date stated in the records of the limited partnership as

the date on which the person becomes a limited partner or, if

that date is not stated in those records, the date on which the

person's admission is first reflected in the records of the

limited partnership.

(b) After a limited partnership is formed, a person who acquires

a partnership interest directly from the limited partnership

becomes a new limited partner on:

(1) compliance with the provisions of the partnership agreement

governing admission of new limited partners; or

(2) if the partnership agreement does not contain relevant

admission provisions, the written consent of all partners.

partnership interest becomes a new limited partner as provided by

Section 153.253(a).

(d) A person may be a limited partner unless the person lacks

capacity apart from this chapter and the other limited

partnership provisions.

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

Sec. 153.102. LIABILITY TO THIRD PARTIES. (a) A limited

partner is not liable for the obligations of a limited

partnership unless:

(1) the limited partner is also a general partner; or

(2) in addition to the exercise of the limited partner's rights

and powers as a limited partner, the limited partner participates

in the control of the business.

(b) If the limited partner participates in the control of the

business, the limited partner is liable only to a person who

transacts business with the limited partnership reasonably

believing, based on the limited partner's conduct, that the

limited partner is a general partner.

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

Sec. 153.103. ACTIONS NOT CONSTITUTING PARTICIPATION IN BUSINESS

FOR LIABILITY PURPOSES. For purposes of this section and

Sections 153.102, 153.104, and 153.105, a limited partner does

not participate in the control of the business because the

limited partner has or has acted in one or more of the following

capacities or possesses or exercises one or more of the following

powers:

(1) acting as:

(A) a contractor for or an officer or other agent or employee of

the limited partnership;

(B) a contractor for or an agent or employee of a general

partner;

(D) a partner of a partnership that is a general partner of the

limited partnership; or

(E) a member or manager of a limited liability company that is a

general partner of the limited partnership;

(2) acting in a capacity similar to that described in

Subdivision (1) with any other person that is a general partner

of the limited partnership;

(3) consulting with or advising a general partner on any matter,

including the business of the limited partnership;

(4) acting as surety, guarantor, or endorser for the limited

partnership, guaranteeing or assuming one or more specific

obligations of the limited partnership, or providing collateral

for borrowings of the limited partnership;

(5) calling, requesting, attending, or participating in a

meeting of the partners or the limited partners;

(6) winding up the business of a limited partnership under

Chapter 11 and Subchapter K of this chapter;

(7) taking an action required or permitted by law to bring,

pursue, settle, or otherwise terminate a derivative action in the

right of the limited partnership;

(8) serving on a committee of the limited partnership or the

limited partners; or

(9) proposing, approving, or disapproving, by vote or otherwise,

one or more of the following matters:

(A) the winding up or termination of the limited partnership;

(B) an election to reconstitute the limited partnership or

continue the business of the limited partnership;

other transfer of, or granting of a security interest in, an

asset of the limited partnership;

(D) the incurring, renewal, refinancing, or payment or other

discharge of indebtedness by the limited partnership;

(E) a change in the nature of the business of the limited

partnership;

(F) the admission, removal, or retention of a general partner;

(G) the admission, removal, or retention of a limited partner;

(H) a transaction or other matter involving an actual or

potential conflict of interest;

(I) an amendment to the partnership agreement or certificate of

formation;

(J) if the limited partnership is qualified as an investment

company under the federal Investment Company Act of 1940 (15

U.S.C. Section 80a-1 et seq.), as amended, any matter required by

that Act or the rules and regulations of the Securities and

Exchange Commission under that Act, to be approved by the holders

of beneficial interests in an investment company, including:

(i) electing directors or trustees of the investment company;

(ii) approving or terminating an investment advisory or

underwriting contract;

(iii) approving an auditor; and

(iv) acting on another matter that that Act requires to be

approved by the holders of beneficial interests in the investment

company;

(K) indemnification of a general partner under Chapter 8 or

otherwise;

(L) any other matter stated in the partnership agreement;

(M) the exercising of a right or power granted or permitted to

limited partners under this code and not specifically enumerated

in this section; or

(N) the merger or conversion of a limited partnership.

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

Amended by:

Acts 2007, 80th Leg., R.S., Ch.

688, Sec. 121, eff. September 1, 2007.

Acts 2009, 81st Leg., R.S., Ch.

84, Sec. 51, eff. September 1, 2009.

Sec. 153.104. ENUMERATION OF ACTIONS NOT EXCLUSIVE. The

enumeration in Section 153.103 does not mean that a limited

partner who has acted or acts in another capacity or possesses or

exercises another power constitutes participation by that limited

partner in the control of the business of the limited

partnership.

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

Sec. 153.105. CREATION OF RIGHTS. Sections 153.103 and 153.104

do not create rights of limited partners. Rights of limited

partners may be created only by:

(1) the certificate of formation;

(2) the partnership agreement;

(3) other sections of this chapter; or

(4) the other limited partnership provisions.

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

Sec. 153.106. ERRONEOUS BELIEF OF CONTRIBUTOR BEING LIMITED

PARTNER. Except as provided by Section 153.109, a person who

erroneously but in good faith believes that the person has made a

contribution to and has become a limited partner in a limited

partnership is not liable as a general partner or otherwise

obligated because of making or attempting to make the

contribution, receiving distributions from the partnership, or

exercising the rights of a limited partner if, within a

reasonable time after ascertaining the mistake, the person:

(1) causes an appropriate certificate of formation or

certificate of amendment to be signed and filed;

(2) files or causes to be filed with the secretary of state a

written statement in accordance with Section 153.107; or

(3) withdraws from participation in future profits of the

enterprise by executing and filing with the secretary of state a

certificate declaring the person's withdrawal under this section.

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

Sec. 153.107. STATEMENT REQUIRED FOR LIABILITY PROTECTION. (a)

A written statement filed under Section 153.106(2) must be

entitled "Filing under Section 153.106(2), Business Organizations

Code," and contain:

(1) the name of the partnership;

(2) the name and mailing address of the person signing the

written statement; and

(3) a statement that:

(A) the person signing the written statement acquired a limited

partnership interest in the partnership;

(B) the person signing the written statement has made an effort

to cause a general partner of the partnership to file an accurate

certificate of formation required by the code and the general

partner has failed or refused to file the certificate; and

the person signing the written statement is claiming status as a

limited partner of the partnership named in the document.

(b) The statement is effective for 180 days.

more than one person claiming limited partnership status under

this section and Sections 153.106, 153.108, and 153.109.

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

Sec. 153.108. REQUIREMENTS FOR LIABILITY PROTECTION FOLLOWING

EXPIRATION OF STATEMENT. (a) If a certificate described by

Section 153.106(1) has not been filed before the expiration of

the 180-day period described by Section 153.107(b), the person

filing the statement has no further protection from liability

under Section 153.106(2) unless the person complies with this

section. To be protected under Section 153.106 the person must,

not later than the 10th day after the date of expiration of the

180-day period:

(1) withdraw under Section 153.106(3); or

(2) bring an action under Section 153.554 to compel the

execution and filing of a certificate of formation or amendment.

(b) If an action is brought within the applicable period and is

diligently prosecuted to conclusion, the person bringing the

action continues to be protected from liability under Section

153.106(2) until the action is finally decided adversely to that

person.

not protect a person from liability that arises under Sections

153.102-153.105.

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

Sec. 153.109. LIABILITY OF ERRONEOUS CONTRIBUTOR. Regardless of

whether Sections 153.106, 153.107, and 153.108 apply, a person

who makes a contribution in the circumstances described by

Section 153.106 is liable as a general partner to a third party

who transacts business with the partnership before an action

taken under Section 153.106 if:

(1) the contributor has knowledge or notice that no certificate

has been filed or that the certificate inaccurately referred to

the contributor as a general partner; and

(2) the third party reasonably believed, based on the

contributor's conduct, that the contributor was a general partner

at the time of the transaction and extended credit to the

partnership in reasonable reliance on the credit of the

contributor.

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

Sec. 153.110. WITHDRAWAL OF LIMITED PARTNER. A limited partner

may withdraw from a limited partnership only at the time or on

the occurrence of an event specified in a written partnership

agreement. The withdrawal of the partner must be made in

accordance with that agreement.

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

Sec. 153.111. DISTRIBUTION ON WITHDRAWAL. Except as otherwise

provided by Section 153.210 or the partnership agreement, on

withdrawal a withdrawing limited partner is entitled to receive,

not later than a reasonable time after withdrawal, the fair value

of that limited partner's interest in the limited partnership as

of the date of withdrawal.

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

Sec. 153.112. RECEIPT OF WRONGFUL DISTRIBUTION. A limited

partner who receives a distribution that is not permitted under

Section 153.210 is not required to return the distribution unless

the limited partner knew that the distribution violated the

prohibition of Section 153.210. This section does not affect an

obligation of the limited partner under the partnership agreement

or other applicable law to return the distribution.

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

Sec. 153.113. POWERS OF ESTATE OF LIMITED PARTNER WHO IS

DECEASED OR INCAPACITATED. If a limited partner who is an

individual dies or a court adjudges the limited partner to be

incapacitated in managing the limited partner's person or

property, the limited partner's executor, administrator,

guardian, conservator, or other legal representative may exercise

all of the limited partner's rights and powers to settle the

limited partner's estate or administer the limited partner's

property, including the power of an assignee to become a limited

partner under the partnership agreement.

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

SUBCHAPTER D. GENERAL PARTNERS

Sec. 153.151. ADMISSION OF GENERAL PARTNERS. (a) After a

limited partnership is formed, additional general partners may be

admitted:

(1) in the manner provided by a written partnership agreement;

(2) if a written partnership agreement does not provide for the

admission of additional general partners, with the written

consent of all partners.

(b) A person may be a general partner unless the person lacks

capacity apart from this chapter.

may be admitted as a general partner in a limited partnership,

including as a sole general partner, and may acquire a

partnership interest in the limited partnership without:

(1) making a contribution to the limited partnership; or

(2) assuming an obligation to make a contribution to the limited

partnership.

(d) A written partnership agreement may provide that a person

may be admitted as a general partner in a limited partnership,

including as the sole general partner, without acquiring a

partnership interest in the limited partnership.

(e) This section is not a limitation of or does not otherwise

affect Section 153.152.

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

Amended by:

Acts 2005, 79th Leg., Ch.

64, Sec. 87, eff. January 1, 2006.

Acts 2005, 79th Leg., Ch.

64, Sec. 88, eff. January 1, 2006.

Sec. 153.152. GENERAL POWERS AND LIABILITIES OF GENERAL PARTNER.

(a) Except as provided by this chapter, the other limited

partnership provisions, or a partnership agreement, a general

partner of a limited partnership:

(1) has the rights and powers and is subject to the restrictions

of a partner in a partnership without limited partners; and

(2) has the liabilities of a partner in a partnership without

limited partners to the partnership and to the other partners.

(b) Except as provided by this chapter or the other limited

partnership provisions, a general partner of a limited

partnership has the liabilities of a partner in a partnership

without limited partners to a person other than the partnership

and the other partners.

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

Sec. 153.153. POWERS AND LIABILITIES OF PERSON WHO IS BOTH

GENERAL PARTNER AND LIMITED PARTNER. A person who is both a

general partner and a limited partner:

(1) has the rights and powers and is subject to the restrictions

and liabilities of a general partner; and

(2) except as otherwise provided by the partnership agreement,

this chapter, or the other limited partnership provisions, has

the rights and powers and is subject to the restrictions and

liabilities, if any, of a limited partner to the extent of the

general partner's participation in the partnership as a limited

partner.

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

Sec. 153.154. CONTRIBUTIONS BY AND DISTRIBUTIONS TO GENERAL

PARTNER. A general partner of a limited partnership may make a

contribution to, be allocated profits and losses of, and receive

a distribution from the limited partnership as a general partner,

a limited partner, or both.

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

Sec. 153.155. WITHDRAWAL OF GENERAL PARTNER. (a) A person

ceases to be a general partner of a limited partnership on the

occurrence of one or more of the following events of withdrawal:

(1) the general partner withdraws as a general partner from the

limited partnership as provided by Subsection (b);

(2) the general partner ceases to be a general partner of the

limited partnership as provided by Section 153.252(b);

(3) the general partner is removed as a general partner in

accordance with the partnership agreement;

(4) unless otherwise provided by a written partnership

agreement, or with the written consent of all partners, the

general partner:

(A) makes a general assignment for the benefit of creditors;

(B) files a voluntary bankruptcy petition;

insolvent in a federal or state bankruptcy or insolvency

proceeding;

(D) files a petition or answer seeking for the general partner a

reorganization, arrangement, composition, readjustment,

liquidation, winding up, termination, dissolution, or similar

relief under law;

(E) files a pleading admitting or failing to contest the

material allegations of a petition filed against the general

partner in a proceeding of the type described by Paragraphs

(A)-(D); or

(F) seeks, consents to, or acquiesces in the appointment of a

trustee, receiver, or liquidator of the general partner or of all

or a substantial part of the general partner's properties;

(5) unless otherwise provided by a written partnership agreement

or with the written consent of all partners, the expiration of:

(A) 120 days after the date of the commencement of a proceeding

against the general partner seeking reorganization, arrangement,

composition, readjustment, liquidation, dissolution, or similar

relief under law if the proceeding has not been previously

dismissed;

(B) 90 days after the date of the appointment, without the

general partner's consent, of a trustee, receiver, or liquidator

of the general partner or of all or a substantial part of the

general partner's properties if the appointment has not

previously been vacated or stayed; or

appointment has not previously been vacated;

(6) the death of a general partner;

(7) a court adjudicating a general partner who is an individual

mentally incompetent to manage the general partner's person or

property;

(8) unless otherwise provided by a written partnership agreement

or with the written consent of all partners, the commencement of

winding up activities intended to conclude in the termination of

a trust that is a general partner, but not merely the

substitution of a new trustee;

(9) unless otherwise provided by a written partnership agreement

or with the written consent of all partners, the commencement of

winding up activities of a separate partnership that is a general

partner;

(10) unless otherwise provided by a written partnership

agreement or with the written consent of all partners, the:

(A) filing of a certificate of termination or its equivalent for

an entity, other than a nonfiling entity or a foreign nonfiling

entity, that is a general partner; or

(B) termination or revocation of the certificate of formation or

its equivalent of an entity, other than a nonfiling entity or a

foreign nonfiling entity, that is a general partner and the

expiration of 90 days after the date of notice to the entity of

termination or revocation without a reinstatement of its

certificate of formation or its equivalent; or

(11) the distribution by the fiduciary of an estate that is a

general partner of the estate's entire interest in the limited

partnership.

(b) A general partner may withdraw at any time from a limited

partnership and cease to be a general partner under Subsection

(a) by giving written notice to the other partners.

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

Amended by:

Acts 2007, 80th Leg., R.S., Ch.

688, Sec. 122, eff. September 1, 2007.

Sec. 153.156. NOTICE OF EVENT OF WITHDRAWAL. A general partner

who is subject to an event that with the passage of the specified

period becomes an event of withdrawal under Section 153.155(a)(4)

or (5) shall notify the other partners of the event not later

than the 30th day after the date on which the event occurred.

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

Sec. 153.157. WITHDRAWAL OF GENERAL PARTNER IN VIOLATION OF

PARTNERSHIP AGREEMENT. Unless otherwise provided by the

partnership agreement, a withdrawal by a general partner of a

partnership having a period of duration or for a particular

undertaking before the expiration of that period or completion of

that undertaking is a breach of the partnership agreement.

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

Amended by:

Acts 2007, 80th Leg., R.S., Ch.

688, Sec. 123, eff. September 1, 2007.

Sec. 153.158. EFFECT OF WITHDRAWAL. (a) Unless otherwise

provided by a written partnership agreement and subject to the

liability created under Section 153.162, if a general partner

ceases to be a general partner under Section 153.155, the

remaining general partner or partners, or, if there are no

remaining general partners, a majority-in-interest of the limited

partners in a vote that excludes any limited partnership interest

held by the withdrawing general partner, may:

(1) convert that general partner's partnership interest to that

of a limited partner; or

(2) pay to the withdrawn general partner in cash, or secure by

bond approved by a court of competent jurisdiction, the value of

that partner's partnership interest minus the damages caused if

the withdrawal constituted a breach of the partnership agreement.

(b) Until an action described by Subsection (a) is taken, the

owner of the partnership interest of the withdrawn general

partner has the status of an assignee under Subchapter F, Section

153.113, and Section 153.555.

withdrawal of a general partner, the partnership may be

reconstituted.

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

Sec. 153.159. CONVERSION OF PARTNERSHIP INTEREST AFTER

WITHDRAWAL. If the partners convert the partnership interest

under Section 153.158(a)(1), the limited partnership interest may

be reduced pro rata with all other partners to provide

compensation, an interest in the partnership, or both, to a

replacement general partner.

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

Sec. 153.160. EFFECT OF CONVERSION OF PARTNERSHIP INTEREST. (a)

After an amendment to the certificate of formation reflecting

the general partner's withdrawal as a general partner is filed

under Section 153.051, the withdrawing general partner:

(1) may vote as a limited partner in all matters, to the same

extent as the members of the class of limited partners having the

least voting rights with respect to the matter on which the vote

is taken; and

(2) may not vote on the admission and compensation of a general

partner who replaces the withdrawing general partner.

(b) If the general partner's withdrawal violates the partnership

agreement, the general partner does not have voting rights.

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

Sec. 153.161. LIABILITY OF GENERAL PARTNER FOR DEBT INCURRED

AFTER EVENT OF WITHDRAWAL. (a) Unless otherwise provided by a

written partnership agreement and subject to the liability

created under Section 153.162, a general partner who ceases to be

a general partner under Section 153.155 is not personally liable

in the partner's capacity as a general partner for partnership

debt incurred after that partner ceases to be a general partner

unless the applicable creditor at the time the debt was incurred

reasonably believed that the partner remained a general partner.

(b) A creditor of the partnership has reason to believe that a

partner remains a general partner if:

(1) the creditor had no knowledge or notice of the general

partner's withdrawal and:

(A) was a creditor of the partnership at the time of the general

partner's withdrawal; or

(B) had extended credit to the partnership within two years

before the date of withdrawal; or

(2) the creditor had known that the partner was a general

partner in the partnership before the general partner's

withdrawal and had no knowledge or notice of the withdrawal and

the general partner's withdrawal had not been advertised in a

newspaper of general circulation in each place at which the

partnership business was regularly conducted.

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

Sec. 153.162. LIABILITY FOR WRONGFUL WITHDRAWAL. (a) If a

general partner's withdrawal from a limited partnership violates

the partnership agreement, the partnership may recover damages

from the withdrawing general partner for breach of the

partnership agreement, including the reasonable cost of obtaining

replacement of the services the withdrawn partner was obligated

to perform.

(b) In addition to pursuing any remedy available under

applicable law, the partnership may effect the recovery of

damages under Subsection (a) by offsetting those damages against

the amount otherwise distributable to the withdrawing general

partner, reducing the limited partner interest into which the

withdrawing general partner's interest may be converted under

Section 153.158(a)(1), or both.

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

SUBCHAPTER E. FINANCES

Sec. 153.201. FORM OF CONTRIBUTION. The contribution of a

partner may consist of a tangible or intangible benefit to the

limited partnership or other property of any kind or nature,

including:

(1) cash;

(2) a promissory note;

(3) services performed;

(4) a contract for services to be performed; and

(5) another interest in or security of the limited partnership,

another domestic or foreign limited partnership, or other entity.

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

Amended by:

Acts 2005, 79th Leg., Ch.

64, Sec. 89, eff. January 1, 2006.

Sec. 153.202. ENFORCEABILITY OF PROMISE TO MAKE CONTRIBUTION.

(a) A promise by a limited partner to make a contribution to, or

pay cash or transfer other property to, a limited partnership is

not enforceable unless the promise is in writing and signed by

the limited partner.

(b) Except as otherwise provided by the partnership agreement, a

partner or the partner's legal representative or successor is

obligated to the limited partnership to perform an enforceable

promise to make a contribution to or pay cash or transfer other

property to a limited partnership, notwithstanding the partner's

death, disability, or other change in circumstances.

successor does not make a contribution or other payment of cash

or transfer of other property required by the enforceable

promise, whether as a contribution or with respect to a

contribution previously made, that partner or the partner's legal

representative or successor is obligated, at the option of the

limited partnership, to pay to the partnership an amount of cash

equal to the portion of the agreed value, as stated in the

partnership agreement or in the partnership records required to

be kept under Sections 153.551 and 153.552, of the contribution

represented by the amount of cash that has not been paid or the

value of the property that has not been transferred.

(d) A partnership agreement may provide that the partnership

interest of a partner who fails to make a payment of cash or

transfer of other property to the partnership, whether as a

contribution or with respect to a contribution previously made,

required by an enforceable promise is subject to specified

consequences, which may include:

(1) a reduction of the defaulting partner's percentage or other

interest in the limited partnership;

(2) subordination of the partner's partnership interest to the

interest of nondefaulting partners;

(3) a forced sale of the partner's partnership interest;

(4) forfeiture of the partner's partnership interest;

(5) the lending of money to the defaulting partner by other

partners of the amount necessary to meet the defaulting partner's

commitment;

(6) a determination of the value of the defaulting partner's

partnership interest by appraisal or by formula and redemption or

sale of the partnership interest at that value; or

(7) another penalty or consequence.

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

Sec. 153.203. RELEASE OF OBLIGATION TO PARTNERSHIP. Unless

otherwise provided by the partnership agreement, the obligation

of a partner or the legal representative or successor of a

partner to make a contribution, pay cash, transfer other

property, or return cash or property paid or distributed to the

partner in violation of this chapter or the partnership agreement

may be compromised or released only by consent of all of the

partners.

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

Sec. 153.204. ENFORCEABILITY OF OBLIGATION. (a)

Notwithstanding a compromise or release under Section 153.203, a

creditor of a limited partnership who extends credit or otherwise

acts in reasonable reliance on an obligation described by Section

153.203 may enforce the original obligation if:

(1) the obligation is reflected in a document signed by the

partner; and

(2) the document is not amended or canceled to reflect the

compromise or release.

(b) Notwithstanding the compromise or release, a general partner

remains liable to persons other than the partnership and the

other partners, as provided by Sections 153.152(a)(2) and (b).

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

Sec. 153.205. REQUIREMENTS TO ENFORCE CONDITIONAL OBLIGATION.

(a) An obligation of a limited partner of a limited partnership

that is subject to a condition may be enforced by the partnership

creditor described by Section 153.204 only if the condition is

satisfied or waived by or with respect to the limited partner.

(b) A conditional obligation of a limited partner of a limited

partnership includes a contribution payable on a discretionary

call of the limited partnership before the time the call occurs.

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

Sec. 153.206. ALLOCATION OF PROFITS AND LOSSES. (a) The

profits and losses of a limited partnership shall be allocated

among the partners in the manner provided by a written

partnership agreement.

(b) If a written partnership agreement does not provide for the

allocation of profits and losses, the profits and losses shall be

allocated:

(1) in accordance with the current percentage or other interest

in the partnership stated in partnership records of the kind

described by Section 153.551(a); or

(2) if the allocation of profits and losses is not provided for

in partnership records of the kind described by Section

153.551(a), in proportion to capital accounts.

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

Sec. 153.207. RIGHT TO DISTRIBUTION. Subject to Section

153.210, when a partner becomes entitled to receive a

distribution, the partner has with respect to the distribution

the status of and is entitled to all remedies available to a

creditor of the limited partnership.

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

Sec. 153.208. SHARING OF DISTRIBUTIONS. (a) A distribution of

cash or another asset of a limited partnership shall be made to a

partner in the manner provided by a written partnership

agreement.

(b) If a written partnership agreement does not provide

otherwise, a distribution that is a return of capital shall be

made on the basis of the agreed value, as stated in the

partnership records required to be maintained under Section

153.551(a), of the contribution made by each partner to the

extent that the contribution has not been returned. A

distribution that is not a return of capital shall be made in

proportion to the allocation of profits as determined under

Section 153.206.

in this section, "return of capital" means a distribution to a

partner to the extent that the partner's capital account,

immediately after the distribution, is less than the amount of

that partner's contribution to the partnership as reduced by a

prior distribution that was a return of capital.

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

Sec. 153.209. INTERIM DISTRIBUTIONS. Except as otherwise

provided by this section and Section 153.210, a partner is

entitled to receive a distribution from a limited partnership to

the extent and at the time or on the occurrence of an event

specified in the partnership agreement before:

(1) the partner withdraws from the partnership; and

(2) the winding up of the partnership business.

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

Sec. 153.210. LIMITATION ON DISTRIBUTION. (a) Unless the

distribution is made in compliance with Chapter 11, a limited

partnership may not make a distribution to a partner if,

immediately after giving effect to the distribution and despite

any compromise of a claim referred to by Sections 153.203 and

153.204, all liabilities of the limited partnership, other than

liabilities to partners with respect to their partnership

interests and liabilities for which the recourse of creditors is

limited to specified property of the limited partnership, exceed

the fair value of the partnership assets. The fair value of

property that is subject to a liability for which recourse of

creditors is limited shall be included in the partnership assets

for purposes of this subsection only to the extent that the fair

value of that property exceeds that liability.

(b) For purposes of this section, "distribution" does not

include an amount constituting reasonable compensation for

present or past services or a reasonable payment made in the

ordinary course of business under a bona fide retirement plan or

other benefits program.

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

Amended by:

Acts 2009, 81st Leg., R.S., Ch.

84, Sec. 52, eff. September 1, 2009.

SUBCHAPTER F. PARTNERSHIP INTEREST

Sec. 153.251. ASSIGNMENT OF PARTNERSHIP INTEREST. (a) Except

as otherwise provided by the partnership agreement, a partnership

interest is assignable wholly or partly.

(b) Except as otherwise provided by the partnership agreement,

an assignment of a partnership interest:

(1) does not require the winding up of a limited partnership;

(2) does not entitle the assignee to become, or to exercise

rights or powers of, a partner; and

(3) entitles the assignee to be allocated income, gain, loss,

deduction, credit, or similar items and to receive distributions

to which the assignor was entitled to the extent those items are

assigned.

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

Amended by:

Acts 2007, 80th Leg., R.S., Ch.

688, Sec. 124, eff. September 1, 2007.

Sec. 153.252. RIGHTS OF ASSIGNOR. (a) Except as otherwise

provided by the partnership agreement, until the assignee becomes

a partner, the assignor partner continues to be a partner in the

limited partnership. The assignor partner may exercise any rights

or powers of a partner, except to the extent those rights or

powers are assigned.

(b) Except as otherwise provided by the partnership agreement,

on the assignment by a general partner of all of the general

partner's rights as a general partner, the general partner's

status as a general partner may be terminated by the affirmative

vote of a majority-in-interest of the limited partners.

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

Sec. 153.253. RIGHTS OF ASSIGNEE. (a) An assignee of a

partnership interest, including the partnership interest of a

general partner, may become a limited partner if and to the

extent that:

(1) the partnership agreement provides; or

(2) all partners consent.

(b) An assignee who becomes a limited partner, to the extent of

the rights and powers assigned, has the rights and powers and is

subject to the restrictions and liabilities of a limited partner

under a partnership agreement and this code.

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

Sec. 153.254. LIABILITY OF ASSIGNEE. (a) Until an assignee of

the partnership interest in a limited partnership becomes a

partner, the assignee does not have liability as a partner solely

as a result of the assignment.

(b) Unless otherwise provided by a written partnership

agreement, an assignee who becomes a limited partner:

(1) is liable for the obligations of the assignor to make

contributions as provided by Sections 153.202-153.204;

(2) is not obligated for liabilities unknown to the assignee at

the time the assignee became a limited partner and that could not

be ascertained from a written partnership agreement; and

(3) is not liable for the obligations of the assignor under

Sections 153. 105, 153.112, and 153.162.

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

Sec. 153.255. LIABILITY OF ASSIGNOR. Regardless of whether an

assignee of a partnership interest becomes a limited partner, the

assignor is not released from the assignor's liability to the

limited partnership under Subchapter E and Sections 153.105,

153.112, and 153.162.

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

Sec. 153.256. PARTNER'S PARTNERSHIP INTEREST SUBJECT TO CHARGING

ORDER. (a) On application by a judgment creditor of a partner or

of any other owner of a partnership interest, a court having

jurisdiction may charge the partnership interest of the judgment

debtor to satisfy the judgment.

(b) To the extent that the partnership interest is charged in

the manner provided by Subsection (a), the judgment creditor has

only the right to receive any distribution to which the judgment

debtor would otherwise be entitled in respect of the partnership

interest.

partnership interest. The charging order lien may not be

foreclosed on under this code or any other law.

(d) The entry of a charging order is the exclusive remedy by

which a judgment creditor of a partner or of any other owner of a

partnership interest may satisfy a judgment out of the judgment

debtor's partnership interest.

(e) This section does not deprive a partner or other owner of a

partnership interest of a right under exemption laws with respect

to the judgment debtor's partnership interest.

(f) A creditor of a partner or of any other owner of a

partnership interest does not have the right to obtain possession

of, or otherwise exercise legal or equitable remedies with

respect to, the property of the limited partnership.

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

Amended by:

Acts 2007, 80th Leg., R.S., Ch.

688, Sec. 125, eff. September 1, 2007.

Acts 2009, 81st Leg., R.S., Ch.

84, Sec. 53, eff. September 1, 2009.

Sec. 153.257. EXEMPTION LAWS APPLICABLE TO PARTNERSHIP INTEREST

NOT AFFECTED. Section 153.256 does not deprive a partner of the

benefit of an exemption law applicable to that partner's

partnership interest.

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

SUBCHAPTER G. REPORTS

Sec. 153.301. PERIODIC REPORT. The secretary of state may

require a domestic limited partnership or a foreign limited

partnership registered to transact business in this state to file

a report not more than once every four years as required by this

subchapter.

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

Sec. 153.302. FORM AND CONTENTS OF REPORT. (a) The report

must:

(1) include:

(A) the name of the limited partnership;

(B) the state or territory under the laws of which the limited

partnership is formed;

partnership in this state and the name of the registered agent at

that address;

(D) the address of the principal office in the United States

where records are to be kept or made available under Sections

153.551 and 153.552; and

(E) the name, mailing address, and street address of the

business or residence of each general partner;

(2) be made on a form adopted by the secretary of state for that

purpose; and

(3) be signed on behalf of the limited partnership by at least

one general partner.

(b) The information contained in the report must be given as of

the date of the execution of the report.

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

Sec. 153.303. FILING FEE. The filing fee for the report is as

provided by Chapter 4.

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

Sec. 153.304. DELIVERY OF REPORT. The report must be delivered

to the secretary of state not later than the 30th day after the

date on which notice is mailed under Section 153.305.

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

Sec. 153.305. ACTION BY SECRETARY OF STATE. (a) The secretary

of state shall send a notice that the report required by Section

153.301 is due.

(b) The notice must be:

(1) addressed to the limited partnership; and

(2) mailed to:

(A) the registered office of the limited partnership;

(B) the last known address of the limited partnership as it

appears on record in the office of the secretary of state; or

partnership.

of a report form to be prepared and filed as provided by this

subchapter.

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

Sec. 153.306. EFFECT OF FILING REPORT. (a) If the secretary of

state finds that the report complies with this subchapter, the

secretary shall:

(1) accept the report for filing;

(2) acknowledge to the limited partnership the filing of the

report; and

(3) update the records of the secretary of state's office to

reflect:

(A) a reported change in the address of the registered office or

principal office, or in the business or residence address of a

general partner; and

(B) a reported change in the name of the registered agent.

(b) The filing of a report under Section 153.301 does not

relieve the limited partnership of the requirement to file an

amendment to the certificate of formation required under Section

153.051 or 153.052, except that the limited partnership is not

required to file an amendment to change the information specified

in Subsection (a)(3).

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

Sec. 153.307. EFFECT OF FAILURE TO FILE REPORT. (a) A domestic

or foreign limited partnership that fails to file a report under

Section 153.301 when the report is due forfeits the limited

partnership's right to transact business in this state. A

forfeiture under this section takes effect without judicial

ascertainment.

(b) When the right to transact business has been forfeited under

this section, the secretary of state shall note that the right to

transact business has been forfeited and the date of forfeiture

on the record kept in the secretary's office relating to the

limited partnership.

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

Sec. 153.308. NOTICE OF FORFEITURE OF RIGHT TO TRANSACT

BUSINESS. Notice of the forfeiture under Section 153.307 shall

be mailed to the limited partnership at:

(1) the registered office of the limited partnership;

(2) the last known address of the limited partnership; or

(3) any other place of business of the limited partnership.

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

Sec. 153.309. EFFECT OF FORFEITURE OF RIGHT TO TRANSACT

BUSINESS. (a) Unless the right of the limited partnership to

transact business is revived in accordance with Section 153.310:

(1) the limited partnership may not maintain an action, suit, or

proceeding in a court of this state; and

(2) a successor or assignee of the limited partnership may not

maintain an action, suit, or proceeding in a court of this state

on a right, claim, or demand arising from the transaction of

business by the limited partnership in this state.

(b) The forfeiture of the right to transact business in this

state does not:

(1) impair the validity of a contract or act of the limited

partnership; or

(2) prevent the limited partnership from defending an action,

suit, or proceeding in a court of this state.

the liability of a limited partner.

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

Amended by:

Acts 2009, 81st Leg., R.S., Ch.

84, Sec. 54, eff. September 1, 2009.

Sec. 153.310. REVIVAL OF RIGHT TO TRANSACT BUSINESS. (a) A

limited partnership that forfeits the right to transact business

in this state as provided by Section 153.309 may be relieved from

the forfeiture by filing the required report not later than the

120th day after the date of mailing of the notice of forfeiture

under Section 153.308, accompanied by the filing fees as provided

by Chapter 4.

(b) If a limited partnership complies with Subsection (a), the

secretary of state shall:

(1) revive the right of the limited partnership to transact

business in this state;

(2) cancel the note regarding the forfeiture; and

(3) note the revival and the date of revival on the record kept

in the secretary's office relating to the limited partnership.

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

Sec. 153.311. TERMINATION OF CERTIFICATE OR REVOCATION OF

REGISTRATION AFTER FORFEITURE. (a) The secretary of state may

terminate the certificate of formation of a domestic limited

partnership, or revoke the registration of a foreign limited

partnership, if the limited partnership:

(1) forfeits its right to transact business in this state under

Section 153.307; and

(2) fails to revive that right under Section 153.310.

(b) Termination of the certificate or revocation of registration

takes effect without judicial ascertainment.

revocation and the date on the record kept in the secretary's

office relating to the limited partnership.

(d) On termination or revocation, the status of the limited

partnership is changed to inactive according to the records of

the secretary of state. The change to inactive status does not

affect the liability of a limited partner.

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

Amended by:

Acts 2009, 81st Leg., R.S., Ch.

84, Sec. 55, eff. September 1, 2009.

Sec. 153.312. REINSTATEMENT OF CERTIFICATE OF FORMATION OR

REGISTRATION. (a) A limited partnership the certificate of

formation or registration of which has been terminated or revoked

as provided by Section 153.311 may be relieved of the termination

or revocation by filing the report required by Section 153.301,

accompanied by the filing fees provided by Chapter 4.

(b) If the limited partnership pays the fees required by

Subsection (a) and all taxes, penalties, and interest due and

accruing before termination or revocation, the secretary of state

shall:

(1) reinstate the certificate or registration of the limited

partnership without judicial ascertainment;

(2) change the status of the limited partnership to active; and

(3) note the reinstatement on the record kept in the secretary's

office relating to the limited partnership.

the time of reinstatement, the secretary of state shall require

the limited partnership as a precondition to reinstatement to:

(1) file an amendment to the partnership's certificate of

formation; or

(2) in the case of a foreign limited partnership, amend its

application for registration to adopt an assumed name for use in

this state.

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

Amended by:

Acts 2009, 81st Leg., R.S., Ch.

84, Sec. 56, eff. September 1, 2009.

SUBCHAPTER H. LIMITED PARTNERSHIP AS LIMITED LIABILITY

PARTNERSHIP

Sec. 153.351. REQUIREMENTS. A limited partnership is a limited

liability partnership and a limited partnership if the

partnership:

(1) registers as a limited liability partnership:

(A) as permitted by its partnership agreement; or

(B) if its partnership agreement does not include a provision

for becoming a limited liability partnership, with the consent of

partners required to amend its partnership agreement;

(2) complies with Subchapter J, Chapter 152; and

(3) complies with Chapter 5.

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

Sec. 153.352. APPLICABILITY OF OTHER REQUIREMENTS. For purposes

of applying Section 152.802 to a limited partnership:

(1) an application to become a limited liability partnership or

to withdraw a registration must be signed by at least one general

partner; and

(2) other references to a partner mean a general partner only.

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

Sec. 153.353. LAW APPLICABLE TO PARTNERS. If a limited

partnership is a limited liability partnership, Section 152.801

applies to a general partner and to a limited partner who is

liable under other provisions of this chapter for the debts or

obligations of the limited partnership.

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

SUBCHAPTER I. DERIVATIVE ACTIONS

Sec. 153.401. RIGHT TO BRING ACTION. A limited partner may

bring an action in a court on behalf of the limited partnership

to recover a judgment in the limited partnership's favor if:

(1) all general partners with authority to bring the action have

refused to bring the action; or

(2) an effort to cause those general partners to bring the

action is not likely to succeed.

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

Sec. 153.402. PROPER PLAINTIFF. In a derivative action, the

plaintiff must be a limited partner when the action is brought

and:

(1) the person must have been a limited partner at the time of

the transaction that is the subject of the action; or

(2) the person's status as a limited partner must have arisen by

operation of law or under the terms of the partnership agreement

from a person who was a limited partner at the time of the

transaction.

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

Sec. 153.403. PLEADING. In a derivative action, the complaint

must contain with particularity:

(1) the effort, if any, of the plaintiff to secure initiation of

the action by a general partner; or

(2) the reasons for not making the effort.

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

Sec. 153.404. SECURITY FOR EXPENSES OF DEFENDANTS. (a) In a

derivative action, the court may require the plaintiff to give

security for the reasonable expenses incurred or expected to be

incurred by a defendant in the action, including reasonable

attorney's fees.

(b) The court may increase or decrease at any time the amount of

the security on a showing that the security provided is

inadequate or excessive.

file an affidavit in accordance with the Texas Rules of Civil

Procedure.

(d) Except as provided by Subsection (c), if a plaintiff fails

to give the security within a reasonable time set by the court,

the court shall dismiss the suit without prejudice.

(e) The court, on final judgment for a defendant and on a

finding that suit was brought without reasonable cause against

the defendant, may require the plaintiff to pay reasonable

expenses, including reasonable attorney's fees, to the defendant,

regardless of whether security has been required.

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

Sec. 153.405. EXPENSES OF PLAINTIFF. If a derivative action is

successful, wholly or partly, or if anything is received by the

plaintiff because of a judgment, compromise, or settlement of the

action or claim constituting a part of the action, the court may

award the plaintiff reasonable expenses, including reasonable

attorney's fees, and shall direct the plaintiff to remit to a

party identified by the court the remainder of the proceeds

received by the plaintiff.

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

SUBCHAPTER K. SUPPLEMENTAL WINDING UP AND TERMINATION PROVISIONS

Sec. 153.501. CANCELLATION OR REVOCATION OF EVENT REQUIRING

WINDING UP; CONTINUATION OF BUSINESS. (a) The limited

partnership may cancel under Section 11.152 an event requiring

winding up arising from the expiration of its period of duration

as specified in Section 11.051(1) or from the occurrence of an

event specified in its governing documents as specified in

Section 11.051(3) if, not later than the 90th day after the

event, all remaining partners, or anothe

State Codes and Statutes

State Codes and Statutes

State Codes and Statutes

State Codes and Statutes

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