By Pitts H.B. No. 2779
76R8659 DWS-F
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to additional charges authorized for a qualified
1-3 commercial loan.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Article 1H.101(b), Title 79, Revised Statutes
1-6 (Article 5069-1H.101, Vernon's Texas Civil Statutes), is amended to
1-7 read as follows:
1-8 (b) The parties may contract for the following additional
1-9 charges:
1-10 (1) a discount or commission that an obligor has paid
1-11 or agreed to pay to one or more underwriters of securities issued
1-12 by the obligor;
1-13 (2) an option or right to exchange, redeem, or convert
1-14 all or a portion of the principal amount of the loan, or interest
1-15 on the principal amount, for or into capital stock or other equity
1-16 securities of an obligor or of an affiliate of the obligor;
1-17 (3) an option or right to purchase capital stock or
1-18 other equity securities of an obligor or of an affiliate of the
1-19 obligor;
1-20 (4) an option or other right, whether by contract,
1-21 conveyance, or otherwise, to participate in or own a share of the
1-22 income, revenues, production, appreciation in value, or profits:
1-23 (A) of an obligor or of an affiliate of the
1-24 obligor;
2-1 (B) of any segment of the business or operations
2-2 of an obligor or of an affiliate of the obligor; or
2-3 (C) derived or to be derived from any ownership
2-4 rights of an obligor or of an affiliate of the obligor in real or
2-5 personal property, including any proceeds of the sale or other
2-6 disposition of ownership rights; or
2-7 (5) any compensation realized as a result of the
2-8 receipt, exercise, sale, or other disposition of any option or
2-9 other right described by this subsection.
2-10 SECTION 2. Section 306.101(b), Finance Code, is amended to
2-11 read as follows:
2-12 (b) The parties to a qualified commercial loan agreement may
2-13 contract for the following charges:
2-14 (1) a discount or commission that an obligor has paid
2-15 or agreed to pay to one or more underwriters of securities issued
2-16 by the obligor;
2-17 (2) an option or right to exchange, redeem, or convert
2-18 all or a portion of the principal amount of the loan, or interest
2-19 on the principal amount, for or into capital stock or other equity
2-20 securities of an obligor or of an affiliate of an obligor;
2-21 (3) an option or right to purchase capital stock or
2-22 other equity securities of an obligor or of an affiliate of an
2-23 obligor;
2-24 (4) an option or other right created by contract,
2-25 conveyance, or otherwise, to participate in or own a share of the
2-26 income, revenues, production, appreciation in value, or profits:
2-27 (A) of an obligor or of an affiliate of an
3-1 obligor;
3-2 (B) of any segment of the business or operations
3-3 of an obligor or of an affiliate of an obligor; or
3-4 (C) derived or to be derived from ownership
3-5 rights of an obligor or of an affiliate of an obligor in property,
3-6 including any proceeds of the sale or other disposition of
3-7 ownership rights; or
3-8 (5) compensation realized as a result of the receipt,
3-9 exercise, sale, or other disposition of an option or other right
3-10 described by this subsection.
3-11 SECTION 3. (a) Section 1 of this Act takes effect
3-12 immediately on passage only if the Act of the 76th Legislature,
3-13 Regular Session, 1999, relating to nonsubstantive additions to and
3-14 corrections in enacted codes does not take effect.
3-15 (b) Section 2 of this Act takes effect September 1, 1999,
3-16 only if the Act of the 76th Legislature, Regular Session, 1999,
3-17 relating to nonsubstantive additions to and corrections in enacted
3-18 codes takes effect.
3-19 SECTION 4. The importance of this legislation and the
3-20 crowded condition of the calendars in both houses create an
3-21 emergency and an imperative public necessity that the
3-22 constitutional rule requiring bills to be read on three several
3-23 days in each house be suspended, and this rule is hereby suspended,
3-24 and that this Act take effect and be in force according to its
3-25 terms, and it is so enacted.