PJC Business

F RAUD AND N EGLIGENT M ISREPRESENTATION

PJC 105.25

“Insider” also includes a managing agent of [ Debtor, Inc./Debtor Partners ], or an affiliate, or an insider of an affiliate as if the affiliate were [ Debtor, Inc./Debtor Partners ]. Relative. The term “relative” in the definition of “insider” is defined in section 24.002(11). If no relatives participated in the relevant transactions, the portions of the definition of insider that refer to “relative” should not be submitted. If there is no fac tual dispute that a relative did participate in a relevant transaction, the court may instruct the jury that the relative is an insider. Affiliate. The term “affiliate” in the definition of “insider” is defined in section 24.002(1). If no affiliates participated in the relevant transactions, the portions of the definition of insider that refer to “affiliate” should not be submitted. If there is no fac tual dispute that an affiliate did participate in a relevant transaction, the court may instruct the jury that the affiliate is an insider. If there is a factual dispute regarding whether a particular entity is an affiliate, the relevant parts of the following definition should be submitted: “Affiliate” means a person or entity— 1. who directly or indirectly owns, controls, or holds with power to vote 20 percent or more of the outstanding voting securi ties of Debtor, Inc. , other than a person or entity who holds the securities— a. as a fiduciary or agent without sole discretionary power to vote the securities or b. solely to secure a debt, if the person or entity has not exercised the power to vote; 2. whose business is operated by Dean Debtor under a lease or other agreement, or a person or entity substantially all of whose assets are controlled by Dean Debtor ; or 3. who operates Dean Debtor ’s business under a lease or other agreement or controls substantially all of Dean Debtor ’s assets. [If the alleged affiliate is a corporation, the following additional definition may be included.] “Affiliate” also means a corporation 20 percent or more of whose outstanding voting securities are directly or indirectly owned, con trolled, or held with power to vote by Dean Debtor .

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