73R7965 DWS-F
By Turner of Harris H.B. No. 1494
Substitute the following for H.B. No. 1494:
By Rudd C.S.H.B. No. 1494
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the organization and operation of nonprofit
1-3 corporations.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Section A, Article 1.02, Texas Non-Profit
1-6 Corporation Act (Article 1396-1.02, Vernon's Texas Civil Statutes),
1-7 is amended by adding Subdivisions (14) and (15) to read as follows:
1-8 (14) "Director" means a member of the board of
1-9 directors of a corporation organized under this Act.
1-10 (15) "Ordinary care" means the care that an ordinarily
1-11 prudent person in a similar position would exercise under similar
1-12 circumstances.
1-13 SECTION 2. The Texas Non-Profit Corporation Act (Article
1-14 1396-1.01 et seq., Vernon's Texas Civil Statutes) is amended by
1-15 adding Article 2.04A to read as follows:
1-16 Art. 2.04A. RESERVED NAME. A. The exclusive right to the
1-17 use of a corporate name may be reserved by:
1-18 (1) a person intending to organize a corporation under
1-19 this Act;
1-20 (2) a domestic corporation intending to change its
1-21 name;
1-22 (3) a foreign corporation intending to apply for a
1-23 certificate of authority to conduct affairs in this State;
1-24 (4) a foreign corporation authorized to conduct
2-1 affairs in this State and intending to change its name; or
2-2 (5) a person intending to organize a foreign
2-3 corporation and intending to have that corporation apply for a
2-4 certificate of authority to conduct affairs in this State.
2-5 B. An application for name reservation or transfer of the
2-6 exclusive use of a specified corporate name is subject to the
2-7 procedures and period prescribed by Article 2.06, Texas Business
2-8 Corporation Act.
2-9 SECTION 3. Article 2.05, Texas Non-Profit Corporation Act
2-10 (Article 1396-2.05, Vernon's Texas Civil Statutes), is amended to
2-11 read as follows:
2-12 Art. 2.05. Registered Office and Registered Agent. <A.>
2-13 Each corporation shall have and continuously maintain in this
2-14 State:
2-15 (1) A registered office which may be, but need not be,
2-16 the same as its principal office.
2-17 (2) A registered agent, which agent may be an
2-18 individual resident in this State whose business office is
2-19 identical with such registered office, or a domestic corporation,
2-20 whether for profit or not for profit, or a foreign corporation,
2-21 whether for profit or not for profit, authorized to transact
2-22 business or to conduct its affairs in this State which has a
2-23 <principal or> business office identical with such registered
2-24 office.
2-25 <B. On or before the 15th day of November, 1961, each not
2-26 for profit corporation organized under the laws of this State prior
2-27 to the effective date of this Act shall designate its registered
3-1 office and appoint its registered agent by filing in the office of
3-2 the Secretary of State a statement setting forth:>
3-3 <(1) The name of the corporation.>
3-4 <(2) The street address of its registered office.>
3-5 <(3) The name of its registered agent.>
3-6 <(4) The street address of its registered agent.>
3-7 <(5) That the street address of its registered office
3-8 and the street address of its registered agent are the same.>
3-9 <(6) That such designation and appointment were
3-10 authorized by resolution duly adopted by its board of directors or,
3-11 if the management of the corporation is vested in its members
3-12 pursuant to Article 2.14C of this Act, by the members.>
3-13 <C. The statement required by this Article shall be executed
3-14 by the corporation by its president or a vice-president, and
3-15 verified by him. The original and a copy of the statement shall be
3-16 delivered to the Secretary of State. If the Secretary of State
3-17 finds that such statement conforms to the provisions of this Act,
3-18 he shall, when all fees have been paid as prescribed by law:>
3-19 <(1) Endorse on the original and the copy the word
3-20 "Filed" and the month, day, and year of the filing thereof.>
3-21 <(2) File the original in his office.>
3-22 <(3) Deliver the copy to the corporation or its
3-23 representative.>
3-24 <D. Upon such filing the designation of the registered
3-25 office and the appointment of the registered agent shall become
3-26 effective.>
3-27 SECTION 4. The Texas Non-Profit Corporation Act (Article
4-1 1396-1.01 et seq., Vernon's Texas Civil Statutes) is amended by
4-2 adding Article 2.06A to read as follows:
4-3 Art. 2.06A. CHANGE OF ADDRESS OF REGISTERED AGENT. A. The
4-4 location of the registered office in this State for a corporation
4-5 may be changed from one address to another by filing in the office
4-6 of the Secretary of State a statement setting forth:
4-7 (1) the name of the corporation represented by the
4-8 registered agent;
4-9 (2) the street address at which the registered agent
4-10 has maintained the registered office for that corporation;
4-11 (3) the new street address at which the registered
4-12 agent will maintain the registered office for that corporation; and
4-13 (4) a statement that notice of the change has been
4-14 given to the corporation in writing at least ten (10) days before
4-15 the date of the filing.
4-16 B. The statement required by this article shall be signed by
4-17 the registered agent or, if the agent is a corporation, by an
4-18 officer of the corporate agent on its behalf. If the registered
4-19 agent is simultaneously filing statements for more than one
4-20 corporation, each statement may contain facsimile signatures in the
4-21 execution. The original and one copy of the statement shall be
4-22 delivered to the Secretary of State. If the Secretary of State
4-23 finds that the statement conforms to this Act, the Secretary of
4-24 State shall:
4-25 (1) endorse on the original and the copy the word
4-26 "Filed," and the month, day, and year of the filing;
4-27 (2) file the original in the Secretary of State's
5-1 office; and
5-2 (3) return the copy to the registered agent.
5-3 C. The registered office of the corporation named in the
5-4 statement shall be changed to the new street address of the
5-5 registered agent on the filing of the statement by the Secretary of
5-6 State.
5-7 SECTION 5. Article 2.09, Texas Non-Profit Corporation Act
5-8 (Article 1396-2.09, Vernon's Texas Civil Statutes), is amended to
5-9 read as follows:
5-10 Art. 2.09. By-Laws. A. The initial by-laws of a
5-11 corporation shall be adopted by its board of directors or, if the
5-12 management of the corporation is vested in its members <pursuant to
5-13 Article 2.14C of this Act>, by the members. <The power to alter,
5-14 amend, or repeal the by-laws or to adopt new by-laws shall be
5-15 vested in the members, if any, but such power may be delegated by
5-16 the members to the board of directors. In the event the
5-17 corporation has no members, the power to alter, amend, or repeal
5-18 the by-laws or to adopt new by-laws shall be vested in the board of
5-19 directors.> The by-laws may contain any provisions for the
5-20 regulation and management of the affairs of the <a> corporation not
5-21 inconsistent with law or <with> the articles of incorporation.
5-22 B. A corporation's board of directors may amend or repeal
5-23 the corporation's by-laws, or adopt new by-laws, unless:
5-24 (1) the articles of incorporation or this Act reserves
5-25 the power exclusively to the members in whole or in part;
5-26 (2) the management of the corporation is vested in its
5-27 members; or
6-1 (3) the members in amending, repealing, or adopting a
6-2 particular by-law expressly provide that the board of directors may
6-3 not amend or repeal that by-law.
6-4 SECTION 6. Section A, Article 2.11, Texas Non-Profit
6-5 Corporation Act (Article 1396-2.11, Vernon's Texas Civil Statutes),
6-6 is amended to read as follows:
6-7 A. In the case of a corporation other than a church, written
6-8 or printed notice stating the place, day, and <or> hour of the
6-9 meeting and, in case of a special meeting, the purpose or purposes
6-10 for which the meeting is called, shall be delivered not less than
6-11 ten (10) nor more than sixty (60) <fifty (50)> days before the date
6-12 of the meeting, either personally, by facsimile transmission, or by
6-13 mail, by or at the direction of the president, or the secretary, or
6-14 the officers or persons calling the meeting, to each member
6-15 entitled to vote at such meeting. If mailed, such notice shall be
6-16 deemed to be delivered when deposited in the United States mail
6-17 addressed to the member at his address as it appears on the records
6-18 of the corporation, with postage thereon paid. If transmitted by
6-19 facsimile, notice is deemed to be delivered on successful
6-20 transmission of the facsimile.
6-21 SECTION 7. The Texas Non-Profit Corporation Act (Article
6-22 1396-1.01 et seq., Vernon's Texas Civil Statutes), is amended by
6-23 adding Articles 2.11A and 2.11B to read as follows:
6-24 Art. 2.11A. RECORD DATE FOR DETERMINING MEMBERS ENTITLED TO
6-25 NOTICE AND VOTE. A. The by-laws of a corporation may fix or
6-26 provide the manner of fixing a date as the record date for
6-27 determining the members entitled to notice of a members' meeting.
7-1 If the by-laws do not fix and do not provide for fixing the record
7-2 date, the board of directors may fix a future date as the record
7-3 date. If a record date is not fixed, members at the close of
7-4 business on the business day preceding the date on which notice is
7-5 given, or if notice is waived, at the close of business on the
7-6 business day preceding the date of the meeting, are entitled to
7-7 notice of the meeting.
7-8 B. The by-laws of a corporation may fix or provide the
7-9 manner of fixing a date as the record date for determining the
7-10 members entitled to vote at a members' meeting. If the by-laws do
7-11 not fix and do not provide for fixing a record date, the board may
7-12 fix a future date as the record date. If a record date is not
7-13 fixed, members on the date of the meeting who are otherwise
7-14 eligible to vote are entitled to vote at the meeting.
7-15 C. The by-laws may fix or provide the manner for fixing a
7-16 date as the record date for the purpose of determining the members
7-17 entitled to exercise any rights regarding any other lawful action.
7-18 If the by-laws do not fix and do not provide for fixing a record
7-19 date, the board of directors may fix in advance a record date. If
7-20 a record date is not fixed, members at the close of business on the
7-21 date on which the board of directors adopts the resolution relating
7-22 to the record date, or the 60th day before the date of the other
7-23 action, whichever is later, are entitled to exercise those rights.
7-24 D. A record date fixed under this section may not be more
7-25 than sixty (60) days before the date of the meeting or action that
7-26 requires the determination of the members.
7-27 E. A determination of members entitled to notice of or to
8-1 vote at a members' meeting is effective for any adjournment of the
8-2 meeting unless the board fixes a new date for determining the right
8-3 to notice or the right to vote. The board must fix a new date for
8-4 determining the right to notice or the right to vote if the meeting
8-5 is adjourned to a date more than ninety (90) days after the record
8-6 date for determining members entitled to notice of the original
8-7 meeting.
8-8 Art. 2.11B. VOTING MEMBERS' LIST FOR MEETING. A. After
8-9 fixing a record date for the notice of a meeting, a corporation
8-10 shall prepare an alphabetical list of the names of all its voting
8-11 members who are entitled to notice of the meeting. The list must
8-12 show the address and number of votes each voting member is entitled
8-13 to cast at the meeting. The corporation shall maintain, through
8-14 the time of the members' meeting, a list of members who are
8-15 entitled to vote at the meeting but are not entitled to notice of
8-16 the meeting. This list shall be prepared on the same basis and be
8-17 part of the list of voting members.
8-18 B. Not later than two (2) business days after the date
8-19 notice is given of a meeting for which a list was prepared, as
8-20 provided by Section A of this article, and continuing through the
8-21 meeting, the list of voting members must be available for
8-22 inspection by any member entitled to vote at the meeting for the
8-23 purpose of communication with other members concerning the meeting
8-24 at the corporation's principal office or at a reasonable place
8-25 identified in the meeting notice in the city where the meeting will
8-26 be held. A voting member or voting member's agent or attorney is
8-27 entitled on written demand to inspect and, subject to the
9-1 limitations of Section B, Article 2.23, of this Act to copy the
9-2 list at a reasonable time and at the member's expense during the
9-3 period it is available for inspection.
9-4 C. The corporation shall make the list of voting members
9-5 available at the meeting, and any voting member or voting member's
9-6 agent or attorney is entitled to inspect the list at any time
9-7 during the meeting or any adjournment.
9-8 SECTION 8. Sections A and B, Article 2.13, Texas Non-Profit
9-9 Corporation Act (Article 1396-2.13, Vernon's Texas Civil Statutes),
9-10 are amended to read as follows:
9-11 A. Each member, regardless of class, shall be entitled to
9-12 one (1) vote on each matter submitted to a vote <at a meeting> of
9-13 the members, except to the extent that the voting rights of members
9-14 of any class or classes are limited, enlarged, or denied by the
9-15 articles of incorporation or the by-laws.
9-16 B. A member may vote in person or, unless the articles of
9-17 incorporation or the by-laws otherwise provide, may vote by proxy
9-18 executed in writing by the member or by his duly authorized
9-19 attorney-in-fact. No proxy shall be valid after eleven (11) months
9-20 from the date of its execution, unless otherwise provided in the
9-21 proxy<; provided, however, proxies executed before and in existence
9-22 on the effective date of this Act shall continue in and have such
9-23 effect as they then have in accordance with whatever may then be
9-24 their terms>. Each proxy shall be revocable unless expressly
9-25 provided therein to be irrevocable, and in no event shall it remain
9-26 irrevocable for more than eleven (11) months. Where directors or
9-27 officers are to be elected by members, the by-laws may provide that
10-1 such elections may be conducted by mail, by facsimile transmission,
10-2 or by any combination of the two.
10-3 SECTION 9. Article 2.14, Texas Non-Profit Corporation Act
10-4 (Article 1396-2.14, Vernon's Texas Civil Statutes), is amended to
10-5 read as follows:
10-6 Art. 2.14. BOARD OF DIRECTORS <OR TRUSTEES>. A. The
10-7 affairs of a corporation shall be managed by a board of directors<,
10-8 or trustees>. Directors <or trustees> need not be residents of
10-9 this State or members of the corporation unless the articles of
10-10 incorporation or the by-laws so require. The articles of
10-11 incorporation or the by-laws may prescribe other qualifications for
10-12 directors <or trustees>.
10-13 B. Boards of directors <or trustees> of religious,
10-14 charitable, educational, or eleemosynary institutions may be
10-15 affiliated with, elected and controlled by a convention, conference
10-16 or association organized under the laws of this State or another
10-17 state, whether incorporated or unincorporated, whose membership is
10-18 composed of representatives, delegates, or messengers from any
10-19 church or other religious association.
10-20 C. The articles of incorporation of a corporation <church>
10-21 may vest the management of the affairs of the corporation in its
10-22 members. If the corporation <church> has a board of directors <or
10-23 similar body>, it may limit the authority of the <such> board of
10-24 directors to whatever extent as may be set forth in the articles of
10-25 incorporation or by-laws. Except for a church that is organized
10-26 and operating under a cooperative system, was incorporated before
10-27 January 1, 1984, and has the management of its affairs vested in
11-1 its members, a <A> corporation <church organized and operating
11-2 under a congregational system and incorporated prior to the
11-3 effective date of this Act> shall be deemed to have vested the
11-4 management of the affairs of the corporation in its board of
11-5 directors <members> in the absence of an express provision to the
11-6 contrary in the articles of incorporation or the by-laws.
11-7 D. The board of directors <In the case of a corporation
11-8 which is a church, the Board> may be designated by any name
11-9 appropriate to the customs, usages, or tenets of the corporation
11-10 <church>.
11-11 E. The board of directors <or trustees> of a <non-profit>
11-12 corporation may be elected (in whole or in part) by one or more
11-13 associations <another non-profit corporation> or corporations,
11-14 organized under the laws of this State or another state <domestic
11-15 or foreign,> if (1) the articles of incorporation or the by-laws
11-16 <bylaws> of the former corporation so provide, and (2) the former
11-17 corporation has no members with voting rights.
11-18 F. The articles of incorporation or the by-laws may provide
11-19 that any one or more persons may be ex-officio members of the board
11-20 of directors. A person designated as an ex-officio member of the
11-21 board of directors is entitled to notice of and to attend meetings
11-22 of the board of directors. The ex-officio member is not entitled
11-23 to vote unless otherwise provided in the articles of incorporation
11-24 or the by-laws. An ex-officio member of the board of directors who
11-25 is not entitled to vote does not have the duties or liabilities of
11-26 a director as provided in this Act.
11-27 SECTION 10. Article 2.15, Texas Non-Profit Corporation Act
12-1 (Article 1396-2.15, Vernon's Texas Civil Statutes), is amended to
12-2 read as follows:
12-3 Art. 2.15. Number, Election, Classification, and Removal of
12-4 Directors. A. The number of directors of a corporation shall be
12-5 not less than three (3). Subject to such limitation, the number of
12-6 directors shall be fixed by, or in the manner provided in, the
12-7 articles of incorporation or the by-laws, except as to the number
12-8 constituting the initial board of directors, which number shall be
12-9 fixed by the articles of incorporation. The number of directors
12-10 may be increased or decreased from time to time by amendment to, or
12-11 in the manner provided in, the articles of incorporation or the
12-12 by-laws, but no decrease shall have the effect of shortening the
12-13 term of any incumbent director. The number of directors may not be
12-14 decreased to fewer than three (3). In the absence of a by-law or a
12-15 provision of the articles of incorporation fixing the number of
12-16 directors or providing for the manner in which the number of
12-17 directors shall be fixed, the number of directors shall be the same
12-18 as the number constituting the initial board of directors as fixed
12-19 by the articles of incorporation.
12-20 B. The directors constituting the initial board of directors
12-21 shall be named in the articles of incorporation and shall hold
12-22 office until the first annual election of directors or for such
12-23 other period as may be specified in the articles of incorporation
12-24 or the by-laws. Thereafter, directors shall be elected, <or>
12-25 appointed, or designated in the manner and for the terms provided
12-26 in the articles of incorporation or the by-laws. If the method of
12-27 election, designation, or appointment is not provided in the
13-1 articles of incorporation or by-laws, the directors, other than the
13-2 initial directors, shall be elected by the board of directors. In
13-3 the absence of a provision in the articles of incorporation or the
13-4 by-laws fixing the term of office, a director shall hold office
13-5 until the next annual election of directors and until his successor
13-6 shall have been elected, <or> appointed, or designated and
13-7 qualified.
13-8 C. Directors may be divided into classes and the terms of
13-9 office of the several classes need not be uniform. Unless removed
13-10 in accordance with the provisions of the articles of incorporation
13-11 or the by-laws, each director shall hold office for the term for
13-12 which he is elected, <or> appointed, or designated and until his
13-13 successor shall have been elected, <or> appointed, or designated
13-14 and qualified.
13-15 D. A director may be removed from office pursuant to any
13-16 procedure therefor provided in the articles of incorporation or
13-17 by-laws. In the absence of a provision providing for removal, a
13-18 director may be removed from office, with or without cause, by the
13-19 persons entitled to elect, designate, or appoint the director. If
13-20 the director was elected to office, removal requires an affirmative
13-21 vote equal to the vote necessary to elect the director.
13-22 SECTION 11. Article 2.20, Texas Non-Profit Corporation Act
13-23 (Article 1396-2.20, Vernon's Texas Civil Statutes), is amended to
13-24 read as follows:
13-25 Art. 2.20. Officers. A. The officers of a corporation
13-26 shall consist of a president and a secretary and may also consist
13-27 of<,> one or more vice-presidents, <a secretary,> a treasurer, and
14-1 such other officers and assistant officers as may be deemed
14-2 necessary, each of whom shall be elected or appointed at such time
14-3 and in such manner and for such terms not exceeding three (3) years
14-4 as may be prescribed in the articles of incorporation or the
14-5 by-laws. In the absence of any such provisions, all officers shall
14-6 be elected or appointed annually by the board of directors, or, if
14-7 the management of the corporation is vested in its members
14-8 <pursuant to Article 2.14C of this Act>, by the members. Any two
14-9 or more offices may be held by the same person, except the offices
14-10 of president and secretary. A committee duly designated may
14-11 perform the functions of any officer and the functions of any two
14-12 or more officers may be performed by a single committee, including
14-13 the functions of both president and secretary.
14-14 B. <The articles of incorporation or the by-laws may provide
14-15 that any one or more officers of the corporation shall be
14-16 ex-officio members of the board of directors.>
14-17 <C.> The officers of a corporation may be designated by such
14-18 other or additional titles as may be provided in the articles of
14-19 incorporation or the by-laws.
14-20 C. <D.> In the case of a corporation which is a church, it
14-21 shall not be necessary that there be officers as provided herein,
14-22 but such duties and responsibilities may be vested in the board of
14-23 directors <trustees> or other designated body in any manner
14-24 provided for in the articles of incorporation or the by-laws.
14-25 D. In the discharge of a duty imposed or power conferred on
14-26 an officer of a corporation, the officer may in good faith and with
14-27 ordinary care rely on information, opinions, reports, or
15-1 statements, including financial statements and other financial
15-2 data, concerning the corporation or another person, that were
15-3 prepared or presented by:
15-4 (1) one or more other officers or employees of the
15-5 corporation, including members of the board of directors;
15-6 (2) legal counsel, public accountants, or other
15-7 persons as to matters the officer reasonably believes are within
15-8 the person's professional or expert competence; or
15-9 (3) in the case of religious corporations, religious
15-10 authorities and ministers, priests, rabbis, or other persons whose
15-11 position or duties in the religious organization the officer
15-12 believes justify reliance and confidence and whom the officer
15-13 believes to be reliable and competent in the matters presented.
15-14 E. An officer is not relying in good faith as required by
15-15 Section D of this article if the officer has knowledge concerning
15-16 the matter in question that makes reliance otherwise permitted by
15-17 Section D of this article unwarranted.
15-18 SECTION 12. Section B, Article 2.23, Texas Non-Profit
15-19 Corporation Act (Article 1396-2.23, Vernon's Texas Civil Statutes),
15-20 is amended to read as follows:
15-21 B. A member of a corporation, on written demand stating the
15-22 purpose of the demand, has the right to examine and copy, in person
15-23 or by agent, accountant, or attorney, at any reasonable time, <All
15-24 books and records of a corporation may be inspected by any member,
15-25 or his agent or attorney,> for any proper purpose, the books and
15-26 records of the corporation relevant to that purpose, at the expense
15-27 of the member <at any reasonable time>.
16-1 SECTION 13. Section B, Article 2.23A, Texas Non-Profit
16-2 Corporation Act (Article 1396-2.23A, Vernon's Texas Civil
16-3 Statutes), is amended to read as follows:
16-4 B. Based on these records, the board of directors <or
16-5 trustees> shall annually prepare or approve a report of the
16-6 financial activity of the corporation for the preceding year. The
16-7 report must conform to accounting standards as promulgated by the
16-8 American Institute of Certified Public Accountants and must include
16-9 a statement of support, revenue, and expenses and changes in fund
16-10 balances, a statement of functional expenses, and balance sheets
16-11 for all funds.
16-12 SECTION 14. Article 2.26, Texas Non-Profit Corporation Act
16-13 (Article 1396-2.26, Vernon's Texas Civil Statutes), is amended to
16-14 read as follows:
16-15 Art. 2.26. LIABILITY OF DIRECTORS IN CERTAIN CASES <AND
16-16 OTHER PERSONS FOR WRONGFUL DISTRIBUTION OF ASSETS>. A. In
16-17 addition to any other liabilities imposed by law upon directors of
16-18 a corporation, the directors who vote for or assent to any
16-19 distribution of assets other than in payment of its debts, when the
16-20 corporation is insolvent or when such distribution would render the
16-21 corporation insolvent, or during the liquidation of the corporation
16-22 without the payment and discharge of or making adequate provisions
16-23 for all known debts, obligations and liabilities of the
16-24 corporation, shall be jointly and severally liable to the
16-25 corporation for the value of such assets which are thus
16-26 distributed, to the extent that such debts, obligations and
16-27 liabilities of the corporation are not thereafter paid and
17-1 discharged.
17-2 B. A director of a corporation who is present at a meeting
17-3 of its board of directors at which action was taken on such
17-4 corporate matter shall be presumed to have assented to such action
17-5 unless his dissent shall be entered in the minutes of the meeting
17-6 or unless he shall file his written dissent to such action with the
17-7 person acting as the secretary of the meeting before the
17-8 adjournment thereof or shall forward such dissent by registered
17-9 mail to the secretary of the corporation immediately after the
17-10 adjournment of the meeting. Such right to dissent shall not apply
17-11 to a director who voted in favor of the action.
17-12 C. A director shall not be liable under Section A of this
17-13 Article if, in voting for or assenting to a distribution, the
17-14 director:
17-15 (1) relied in good faith and with ordinary care on
17-16 information, opinions, reports, or statements, including financial
17-17 statements and other financial data, concerning the corporation or
17-18 another person that were prepared or presented by:
17-19 (a) one or more officers or employees of the
17-20 corporation;
17-21 (b) legal counsel, public accountants, or other
17-22 persons as to matters the director reasonably believes are within
17-23 the person's professional or expert competence; or
17-24 (c) a committee of the board of directors of
17-25 which the director is not a member;
17-26 (2) acting in good faith and with ordinary care,
17-27 considered the assets of the corporation to be at least that of
18-1 their book value; or
18-2 (3) in determining whether the corporation made
18-3 adequate provision for payment, satisfaction, or discharge of all
18-4 of its liabilities and obligations as provided in Article 6.03 of
18-5 this Act, relied in good faith and with ordinary care on financial
18-6 statements of, or other information concerning, a person who was or
18-7 became contractually obligated to pay, satisfy, or discharge some
18-8 or all of those liabilities or obligations <the exercise of
18-9 ordinary care, he relied and acted in good faith upon written
18-10 financial statements of the corporation represented to him to be
18-11 correct by the president or by the officer of such corporation
18-12 having charge of its books of account, or certified by an
18-13 independent public or certified public accountant or firm of such
18-14 accountants fairly to reflect the financial condition of such
18-15 corporation, nor shall he be so liable if, in the exercise of
18-16 ordinary care and good faith, in determining the amount available
18-17 for such distribution, he considered the assets to be of their book
18-18 value>.
18-19 D. A director shall not be liable under this Article if, in
18-20 the exercise of ordinary care, he acted in good faith and in
18-21 reliance upon the written opinion of an attorney for the
18-22 corporation.
18-23 E. A director against whom a claim shall be asserted under
18-24 this Article and who shall be held liable thereon shall be entitled
18-25 to contribution from persons who accepted or received such
18-26 distribution knowing such distribution to have been made in
18-27 violation of this Article, in proportion to the amounts received by
19-1 them respectively.
19-2 SECTION 15. Sections A and C, Article 2.27, Texas Non-Profit
19-3 Corporation Act (Article 1396-2.27, Vernon's Texas Civil Statutes),
19-4 are amended to read as follows:
19-5 A. Notwithstanding any provision in this Act or in the
19-6 articles of incorporation to the contrary (except as provided in
19-7 Section B), the articles of incorporation of each corporation which
19-8 is a private foundation described in Section 509 of the Internal
19-9 Revenue Code of 1986 <1954> shall be deemed to contain the
19-10 following provisions: "The corporation shall make distributions at
19-11 such time and in such manner as not to subject it to tax under
19-12 Section 4942 of the Internal Revenue Code of 1986 <1954>; the
19-13 corporation shall not engage in any act of self-dealing which would
19-14 be subject to tax under Section 4941 of the Code; the corporation
19-15 shall not retain any excess business holdings which would subject
19-16 it to tax under Section 4943 of the Code; the corporation shall
19-17 not make any investments which would subject it to tax under
19-18 Section 4944 of the Code; and the corporation shall not make any
19-19 taxable expenditures which would subject it to tax under Section
19-20 4945 of the Code." With respect to any such corporation organized
19-21 prior to January 1, 1970, this Section A shall apply only for its
19-22 taxable years beginning on or after January 1, 1972.
19-23 C. All references in this Article to "the Code" are to the
19-24 Internal Revenue Code of 1986 <1954>, and all references in this
19-25 Article to specific sections of the Code include corresponding
19-26 provisions of any subsequent Federal tax laws.
19-27 SECTION 16. The Texas Non-Profit Corporation Act (Article
20-1 1396-1.01 et seq., Vernon's Texas Civil Statutes) is amended by
20-2 adding Articles 2.28, 2.29, and 2.30 to read as follows:
20-3 Art. 2.28. GENERAL STANDARDS FOR DIRECTORS. A. A director
20-4 shall discharge the director's duties, including the director's
20-5 duties as a member of a committee, in good faith, with ordinary
20-6 care, and in a manner the director reasonably believes to be in the
20-7 best interest of the corporation.
20-8 B. In the discharge of any duty imposed or power conferred
20-9 on a director, including as a member of a committee, the director
20-10 may in good faith rely on information, opinions, reports, or
20-11 statements, including financial statements and other financial
20-12 data, concerning the corporation or another person that were
20-13 prepared or presented by:
20-14 (1) one or more officers or employees of the
20-15 corporation;
20-16 (2) legal counsel, public accountants, or other
20-17 persons as to matters the director reasonably believes are within
20-18 the person's professional or expert competence;
20-19 (3) a committee of the board of directors of which the
20-20 director is not a member; or
20-21 (4) in the case of religious corporations, religious
20-22 authorities and ministers, priests, rabbis, or other persons whose
20-23 position or duties in the religious organization the director
20-24 believes justify reliance and confidence and whom the director
20-25 believes to be reliable and competent in the matters presented.
20-26 C. A director is not relying in good faith, within the
20-27 meaning of this article, if the director has knowledge concerning a
21-1 matter in question that makes reliance otherwise permitted by this
21-2 article unwarranted.
21-3 D. A director is not liable to the corporation, any member,
21-4 or any other person for any action taken or not taken as a director
21-5 if the director acted in compliance with this article. A person
21-6 seeking to establish liability of a director must prove that the
21-7 director has not acted:
21-8 (1) in good faith;
21-9 (2) with ordinary care; and
21-10 (3) in a manner the director reasonably believes to be
21-11 in the best interest of the corporation.
21-12 E. A director is not deemed to have the duties of a trustee
21-13 of a trust with respect to the corporation or with respect to any
21-14 property held or administered by the corporation, including
21-15 property that may be subject to restrictions imposed by the donor
21-16 or transferor of the property.
21-17 Art. 2.29. DELEGATION OF INVESTMENT AUTHORITY. A. The
21-18 board of directors of a corporation may:
21-19 (1) from time to time contract with investment
21-20 counsel, trust companies, banks, investment advisors, or investment
21-21 managers; and
21-22 (2) confer on those advisors full power and authority
21-23 to:
21-24 (a) purchase or otherwise acquire stocks, bonds,
21-25 securities, and other investments on behalf of the corporation; and
21-26 (b) sell, transfer, or otherwise dispose of any
21-27 of the corporation's assets and properties at a time and for a
22-1 consideration that the advisor deems appropriate.
22-2 B. The board of directors also may:
22-3 (1) confer on an advisor described by Section A of
22-4 this article other powers regarding the corporation's investments
22-5 as the board of directors deems appropriate; and
22-6 (2) authorize the advisor to hold title to any of the
22-7 corporation's assets and properties in its own name for the benefit
22-8 of the corporation or in the name of a nominee for the benefit of
22-9 the corporation.
22-10 C. The board of directors has no liability regarding any
22-11 action taken or omitted by an advisor engaged under this article if
22-12 the board of directors acted in good faith and with ordinary care
22-13 in selecting the advisor. The board of directors may remove or
22-14 replace the advisor, with or without cause, if they deem that
22-15 action appropriate or necessary.
22-16 Art. 2.30. INTERESTED DIRECTORS. A. A contract or
22-17 transaction between a corporation and one or more of its directors,
22-18 officers, or members, or between a corporation and any other
22-19 corporation, partnership, association, or other organization in
22-20 which one or more of its directors, officers, or members are
22-21 directors, officers, or members, or have a financial interest, is
22-22 not void or voidable solely for that reason, solely because the
22-23 director, officer, or member is present at or participates in the
22-24 meeting of the board or committee of the board or of the members
22-25 that authorizes the contract or transaction, or solely because the
22-26 director's, officer's, or member's votes are counted for that
22-27 purpose, if:
23-1 (1) the material facts as to the relationship or
23-2 interest and as to the contract or transaction are disclosed or are
23-3 known to the board of directors, the committee, or the members, and
23-4 the board, committee, or members in good faith and with ordinary
23-5 care authorizes the contract or transaction by the affirmative vote
23-6 of a majority of the disinterested directors or members, even
23-7 though the disinterested directors or members are less than a
23-8 quorum;
23-9 (2) the material facts as to the relationship or
23-10 interest and as to the contract or transaction are disclosed or are
23-11 known to the members entitled to vote on the contract or
23-12 transaction, and the contract or transaction is specifically
23-13 approved in good faith and with ordinary care by vote of the
23-14 disinterested members; or
23-15 (3) the contract or transaction is fair to the
23-16 corporation when it is authorized, approved, or ratified by the
23-17 board of directors, a committee of the board, or the members.
23-18 B. Common or interested directors or members may be counted
23-19 in determining the presence of a quorum at a meeting of the board
23-20 of directors, of a committee, or of the members that authorizes the
23-21 contract or transaction.
23-22 SECTION 17. Sections A and D, Article 3.02, Texas Non-Profit
23-23 Corporation Act (Article 1396-3.02, Vernon's Texas Civil Statutes),
23-24 are amended to read as follows:
23-25 A. The articles of incorporation shall set forth:
23-26 (1) The name of the corporation.
23-27 (2) A statement that the corporation is a non-profit
24-1 corporation.
24-2 (3) The period of duration, which may be perpetual.
24-3 (4) The purpose or purposes for which the corporation
24-4 is organized.
24-5 (5) If the corporation is to have no members, a
24-6 statement to that effect.
24-7 (6) If <the corporation is a church and the>
24-8 management of the <its> affairs of the corporation is to be vested
24-9 in its members <pursuant to Article 2.14C of this Act>, a statement
24-10 to that effect.
24-11 (7) Any provision, not inconsistent with law,
24-12 including any provision which under this Act is required or
24-13 permitted to be set forth in the bylaws, which the incorporators
24-14 elect to set forth in the articles of incorporation for the
24-15 regulation of the internal affairs of the corporation.
24-16 (8) The street address of its initial registered
24-17 office and the name of its initial registered agent at such street
24-18 address.
24-19 (9) The number of directors <or trustees> constituting
24-20 the initial board of directors <or trustees>, and the names and
24-21 addresses of the persons who are to serve as the initial directors
24-22 unless the management of the corporation is vested in its members,
24-23 in which event a statement to that effect shall be set forth <or
24-24 trustees. A church vesting management of its affairs in its
24-25 members pursuant to Article 2.14C of this Act may, in lieu of
24-26 providing for a board of directors or trustees, set forth in the
24-27 articles of incorporation the officers or other body designated
25-1 pursuant to Article 2.20D of this Act>.
25-2 (10) The name and street or post office address of
25-3 each incorporator.
25-4 (11) If the corporation is to be authorized on its
25-5 dissolution to distribute its assets in a manner other than as
25-6 provided by Article 6.02(3) of this Act, a statement describing the
25-7 manner of distribution of the corporation's assets.
25-8 D. Unless the articles of incorporation provide that a
25-9 change in the number of directors <or trustees> shall be made only
25-10 by amendment to the articles of incorporation, a change in the
25-11 number of directors <or trustees> made by amendment to the by-laws
25-12 shall be controlling. In all other cases, whenever a provision of
25-13 the articles of incorporation is inconsistent with a by-law, the
25-14 provision of the articles of incorporation shall be controlling.
25-15 SECTION 18. Sections A and C, Article 3.05, Texas Non-Profit
25-16 Corporation Act (Article 1396-3.05, Vernon's Texas Civil Statutes),
25-17 are amended to read as follows:
25-18 A. After the issuance of the certificate of incorporation,
25-19 an organization meeting of the board of directors named in the
25-20 articles of incorporation shall be held, either within or without
25-21 this State, at the call of <a majority of> the incorporators or the
25-22 call of a majority of the directors named in the articles of
25-23 incorporation, for the purpose of adopting by-laws, electing
25-24 officers, and for such other purposes as may come before the
25-25 meeting. The incorporators or directors calling the meeting shall
25-26 give at least three (3) days' notice thereof by mail to each
25-27 director named in the articles of incorporation, which notice shall
26-1 state the time and place of the meeting.
26-2 C. If the management of a corporation <church> is vested in
26-3 its members <pursuant to Article 2.14C of this Act>, the
26-4 organization meeting shall be held by the members upon the call of
26-5 any <a majority> of the incorporators. The incorporators calling
26-6 the meeting shall (a) give at least three (3) days' notice by mail
26-7 to each member stating the time and place of the meeting, or shall
26-8 (b) make an oral announcement of the time and place of meeting at
26-9 a regularly scheduled worship service prior to such meeting if the
26-10 corporation is a church, or shall (c) give such notice of the
26-11 meeting as may be provided for in the articles of incorporation.
26-12 SECTION 19. Section A, Article 4.02, Texas Non-Profit
26-13 Corporation Act (Article 1396-4.02, Vernon's Texas Civil Statutes),
26-14 is amended to read as follows:
26-15 A. Amendments to the articles of incorporation may be made
26-16 in the following manner:
26-17 (1) Except as provided in Section A(4) of this
26-18 article, where <Where> there are members having voting rights, the
26-19 board of directors shall adopt a resolution setting forth the
26-20 proposed amendment and directing that it be submitted to a vote at
26-21 a meeting of members having voting rights, which may be either an
26-22 annual or a special meeting. Written or printed notice setting
26-23 forth the proposed amendment or a summary of the changes to be
26-24 effected thereby shall be given to each member entitled to vote at
26-25 such meeting within the time and in the manner provided in this Act
26-26 for the giving of notice of meetings of members. The proposed
26-27 amendment shall be adopted upon receiving at least two-thirds of
27-1 the votes which members present at such meeting in person or by
27-2 proxy are entitled to cast, unless any class of members is entitled
27-3 to vote as a class thereon by the terms of the articles of
27-4 incorporation or of the by-laws, in which event the proposed
27-5 amendment shall not be adopted unless it also receives at least
27-6 two-thirds of the votes which the members of each such class who
27-7 are present at such meeting in person or by proxy are entitled to
27-8 cast.
27-9 (2) Where there are no members, <or> no members having
27-10 voting rights, or in the case of an amendment under Section A(4) of
27-11 this article, an amendment shall be adopted at a meeting of the
27-12 board of directors upon receiving the vote of a majority of the
27-13 directors in office.
27-14 (3) Where the management of the affairs of the
27-15 corporation is vested in the members pursuant to Article 2.14C of
27-16 this Act, the proposed amendment shall be submitted to a vote at a
27-17 meeting of members which may be an annual, a regular, or a special
27-18 meeting. Except as otherwise provided in the articles of
27-19 incorporation or the by-laws, notice setting forth the proposed
27-20 amendment or a summary of the changes to be effected thereby shall
27-21 be given to the members within the time and in the manner provided
27-22 in this Act for the giving of notice of meetings of members. The
27-23 proposed amendment shall be adopted upon receiving at least
27-24 two-thirds of the votes of members present at such meeting.
27-25 (4) Unless the articles of incorporation provide
27-26 otherwise, the board of directors of a corporation with members
27-27 having voting rights may adopt one or more of the following
28-1 amendments to the articles of incorporation without member
28-2 approval:
28-3 (a) extend the duration of the corporation if it
28-4 was incorporated when limited duration was required by law;
28-5 (b) delete the names and addresses of the
28-6 initial directors;
28-7 (c) delete the name and address of the initial
28-8 registered agent or registered office, if a statement of change is
28-9 on file with the Secretary of State; or
28-10 (d) change the corporate name by substituting
28-11 the word "corporation," "incorporated," "company," "limited," or
28-12 the abbreviation "corp.," "inc.," "co.," "ltd.," for a similar word
28-13 or abbreviation in the name, or by adding, deleting, or changing a
28-14 geographical attribution to the name.
28-15 SECTION 20. Section A, Article 4.06, Texas Non-Profit
28-16 Corporation Act (Article 1396-4.06, Vernon's Texas Civil Statutes),
28-17 is amended to read as follows:
28-18 A. A corporation may, by following the procedure to amend
28-19 the articles of incorporation provided by this Act, authorize,
28-20 execute and file restated articles of incorporation, except that
28-21 member approval, if the corporation has members with voting rights,
28-22 is not required if no amendments are made. The restated articles
28-23 of incorporation <which> may restate either:
28-24 (1) The entire text of the articles of incorporation
28-25 as amended or supplemented by all certificates of amendment
28-26 previously issued by the Secretary of State; or
28-27 (2) The entire text of the articles of incorporation
29-1 as amended or supplemented by all certificates of amendment
29-2 previously issued by the Secretary of State, and as further amended
29-3 by such restated articles of incorporation.
29-4 SECTION 21. Article 5.05, Texas Non-Profit Corporation Act
29-5 (Article 1396-5.05, Vernon's Texas Civil Statutes), is amended to
29-6 read as follows:
29-7 Art. 5.05. Effective Date of Merger or Consolidation of
29-8 Domestic Corporations. A. Except as provided by Article 10.07 of
29-9 this Act, on <Upon> the issuance of the certificate of merger or
29-10 the certificate of consolidation by the Secretary of State, the
29-11 merger or consolidation of domestic corporations shall be effected.
29-12 SECTION 22. Article 5.08, Texas Non-Profit Corporation Act
29-13 (Article 1396-5.08, Vernon's Texas Civil Statutes), is amended to
29-14 read as follows:
29-15 Art. 5.08. Conveyance by Corporation. A. Any corporation
29-16 may convey land by deed, with or without the seal of the
29-17 corporation, signed by an officer <the president or vice-president>
29-18 or attorney in fact of the corporation when authorized by
29-19 appropriate resolution of the board of directors or members. Such
29-20 deed, when acknowledged by such officer or attorney in fact to be
29-21 the act of the corporation, or proved in the manner prescribed for
29-22 other conveyances of lands, may be recorded in like manner and with
29-23 the same effect as other deeds. Any such deed when recorded, if
29-24 signed by an officer <the president or any vice-president> of the
29-25 corporation, shall constitute prima facie evidence that such
29-26 resolution of the board of directors or members was duly adopted.
29-27 SECTION 23. Article 6.02, Texas Non-Profit Corporation Act
30-1 (Article 1396-6.02, Vernon's Texas Civil Statutes), is amended to
30-2 read as follows:
30-3 Art. 6.02. Application and Distribution of Assets. A. The
30-4 assets of a corporation in the process of dissolution shall be
30-5 applied and distributed as follows:
30-6 (1) All liabilities and obligations of the corporation
30-7 shall be paid, satisfied and discharged; in case its property and
30-8 assets are not sufficient to satisfy or discharge all the
30-9 corporation's liabilities and obligations, the corporation shall
30-10 apply them so far as they will go to the just and equitable payment
30-11 of the liabilities and obligations.
30-12 (2) Assets held by the corporation upon condition
30-13 requiring return, transfer or conveyance, which condition occurs by
30-14 reason of the dissolution, shall be returned, transferred or
30-15 conveyed in accordance with such requirements.
30-16 (3) Unless provided otherwise by a provision of the
30-17 corporation's articles of incorporation <that refers to this
30-18 subsection>, the remaining assets of the corporation shall be
30-19 distributed only for tax exempt purposes to one or more
30-20 organizations which are exempt under Section 501(c)(3), Internal
30-21 Revenue Code of 1986 <1954> (26 U.S.C. Section 501(c)(3)), or its
30-22 successor statute, or which are described in Section 170(c)(1) or
30-23 (2), Internal Revenue Code of 1986 <1954> (26 U.S.C. Section
30-24 170(c)(1) or (2)), or its successor statute, pursuant to a plan of
30-25 distribution adopted as provided in this Act. A district court of
30-26 the county in which the corporation's principal office is located
30-27 shall distribute to one or more organizations exempt under Section
31-1 501(c)(3) or described in Section 170(c)(1) or (2), or their
31-2 successor statutes, the remaining assets of the corporation not
31-3 distributed under the plan of distribution. Any distribution by
31-4 the court shall be made in such manner as, in the judgment of the
31-5 court, will best accomplish the general purposes for which the
31-6 corporation was organized.
31-7 SECTION 24. Article 7.09, Texas Non-Profit Corporation Act
31-8 (Article 1396-7.09, Vernon's Texas Civil Statutes), is amended to
31-9 read as follows:
31-10 Art. 7.09. Decree of Involuntary Dissolution. A. In
31-11 proceedings to liquidate the assets and affairs of a corporation,
31-12 when the costs and expenses of such proceedings and all debts,
31-13 obligations, and liabilities of the corporation shall have been
31-14 paid and discharged, or adequate provision has been made for the
31-15 discharge, and all of its remaining property and assets distributed
31-16 in accordance with the provisions of this Act, or in case its
31-17 property and assets are not sufficient to satisfy and discharge
31-18 such costs, expenses, debts, and obligations, when all the property
31-19 and assets have been applied so far as they will go to their
31-20 payment, the court shall enter a decree dissolving the corporation,
31-21 whereupon the <existence of the> corporation shall cease to exist.
31-22 SECTION 25. Section B, Article 7.11, Texas Non-Profit
31-23 Corporation Act (Article 1396-7.11, Vernon's Texas Civil Statutes),
31-24 is amended to read as follows:
31-25 B. On receipt of satisfactory written <and verified> proof
31-26 of ownership or of right to such fund within seven (7) years from
31-27 the date such fund was so deposited, the State Treasurer shall
32-1 certify such fact to the Comptroller of Public Accounts, who shall
32-2 issue proper warrant therefor drawn on the State Treasurer in favor
32-3 of the person or persons then entitled thereto. If no claimant has
32-4 made satisfactory proof of rights to such fund within seven (7)
32-5 years from the time of such deposit the State Treasurer shall then
32-6 cause to be published in one issue of a newspaper of general
32-7 circulation in Travis County, Texas, a notice of the proposed
32-8 escheat of such fund, giving the name of the creditor, member, or
32-9 other person <or shareholder> apparently entitled thereto, his last
32-10 known address, if any, the amount of the fund so deposited, and the
32-11 name of the dissolved corporation from whose assets such fund was
32-12 derived. If no claimant makes satisfactory proof of right to such
32-13 fund within two months from the time of such publication, the fund
32-14 so unclaimed shall thereupon automatically escheat to and become
32-15 the property of the General Revenue Fund of the State of Texas.
32-16 SECTION 26. Article 7.12, Texas Non-Profit Corporation Act
32-17 (Article 1396-7.12, Vernon's Texas Civil Statutes), is amended to
32-18 read as follows:
32-19 Art. 7.12. Limited Survival After Dissolution. A. A
32-20 dissolved corporation <dissolved (1) by the issuance of a
32-21 certificate of dissolution or other action by the Secretary of
32-22 State, (2) by a decree of a court when the court has not
32-23 liquidated all the assets and business of the corporation as
32-24 provided in this Act, or (3) by expiration of its period of
32-25 duration,> shall continue its corporate existence for a period of
32-26 three (3) years from the date of dissolution, for the following
32-27 purposes:
33-1 (1) prosecuting or defending in its corporate name any
33-2 action or proceeding by or against the corporation;
33-3 (2) permitting the survival of any remedy not
33-4 otherwise barred by limitations available to or against the
33-5 corporation, its officers, directors, members, or creditors, for
33-6 any right or claim existing, or any liability incurred, before the
33-7 dissolution;
33-8 (3) holding title to and liquidating any assets or
33-9 property that remain in the corporation at the time of, or are
33-10 collected by the corporation after, its dissolution, and applying
33-11 or distributing those assets or properties, or the proceeds
33-12 thereof, as provided in Subsection (3) of Section A of Article 6.04
33-13 of this Act; and
33-14 (4) settling any other affairs not completed before
33-15 its dissolution.
33-16 However, such a dissolved corporation may not continue its
33-17 corporate existence for the purpose of continuing the business or
33-18 affairs for which the dissolved corporation was organized, except
33-19 in the case of a corporation whose period of duration has expired
33-20 and that has chosen to revive its existence as provided in this Act
33-21 or a corporation that has been dissolved by the Secretary of State
33-22 pursuant to Section B of Article 7.01 of this Act and that has been
33-23 reinstated pursuant to Section E of Article 7.01 of this Act.
33-24 B. During the three-year period, the members of the board of
33-25 directors of a dissolved corporation <or trustees> serving at the
33-26 time of dissolution or the majority of them then living, however
33-27 reduced in number, or their successors selected by them, shall
34-1 continue to manage the affairs of the dissolved corporation for the
34-2 limited purpose or purposes specified in this Article, and shall
34-3 have the powers necessary to accomplish those purposes, including
34-4 the power to prosecute, pay, compromise, defend, and satisfy any
34-5 action, claim, demand, or judgment by or against the dissolved
34-6 corporation, and to administer, sell, and distribute in final
34-7 liquidation any property or assets still remaining. In the
34-8 exercise of those powers, the directors shall have the same duties
34-9 to the dissolved corporation that they had immediately prior to the
34-10 dissolution of the corporation and shall be liable to the dissolved
34-11 corporation for actions taken by them after the dissolution to the
34-12 same extent that they would have been liable had those actions been
34-13 taken by them prior to the dissolution. Additional directors <or
34-14 trustees> may be elected for purposes of this section in accordance
34-15 with the procedures provided in the bylaws in effect before the
34-16 dissolution.
34-17 C. A corporation is not liable for any claim other than an
34-18 existing claim. An existing claim by or against a dissolved
34-19 corporation is extinguished unless an action or proceeding on the
34-20 existing claim is brought before the third anniversary of the date
34-21 of dissolution. If an action or proceeding on an existing claim by
34-22 or against a dissolved corporation is brought within the period
34-23 provided by this section and the existing claim is not extinguished
34-24 under this article, the dissolved corporation continues to survive:
34-25 (1) for purposes of that action or proceeding until
34-26 all judgments, orders, and decrees in that action or proceeding
34-27 have been fully executed; and
35-1 (2) for purposes of applying or distributing any
35-2 properties or assets of the dissolved corporation as provided in
35-3 Article 6.02 of this Act, until the properties or assets are
35-4 applied or distributed <If after the expiration of the three-year
35-5 period there still remains unresolved any action or proceeding not
35-6 otherwise barred by limitations begun by or against the corporation
35-7 before its dissolution or within three (3) years after the date of
35-8 its dissolution, the corporation shall continue to survive only for
35-9 the purpose of that action or proceeding, until any judgment,
35-10 order, or decree in the action or proceeding is fully executed. If
35-11 at the expiration of the three-year period no action or proceeding
35-12 on any remedy available to or against the corporation, its
35-13 officers, directors, members, or creditors, for any right or claim
35-14 existing, or any liability incurred, before the dissolution shall
35-15 have been brought, then that remedy shall abate>.
35-16 D. A dissolved corporation may give written notice to a
35-17 person having or asserting an existing claim against the dissolved
35-18 corporation to present the existing claim to the dissolved
35-19 corporation in accordance with the notice. The notice must be sent
35-20 by registered or certified mail, return receipt requested, to the
35-21 person having or asserting the existing claim at the person's last
35-22 known address, and must:
35-23 (1) state that the person's claim against the
35-24 dissolved corporation must be presented in writing to the dissolved
35-25 corporation on or before the date stated in the notice, which shall
35-26 be not earlier than 120 days after the date the notice is sent to
35-27 the person;
36-1 (2) state that the written presentation of the claim
36-2 must describe the claim in sufficient detail to reasonably inform
36-3 the dissolved corporation of the identity of the person and to the
36-4 nature and amount of the claim;
36-5 (3) state a mailing address where the written
36-6 presentation of the person's claim against the dissolved
36-7 corporation is to be sent and state that if the written
36-8 presentation of the claim is not received at that address on or
36-9 before the date stated in the notice, the claim will be
36-10 extinguished; and
36-11 (4) be accompanied by a copy of this section.
36-12 E. If a written presentation of a person's claim against the
36-13 dissolved corporation that meets the requirements of Section D of
36-14 this article has been received at the address of the dissolved
36-15 corporation stated in the notice on or before the date stated in
36-16 the notice, the dissolved corporation may give written notice to
36-17 that person that the claim is rejected by the dissolved
36-18 corporation. The notice of rejection must be sent by registered or
36-19 certified mail, return receipt requested, addressed to the person
36-20 at the person's last known address, and must state:
36-21 (1) that the claim is rejected by the dissolved
36-22 corporation;
36-23 (2) that the claim will be extinguished unless an
36-24 action or proceeding on the claim is brought within 180 days after
36-25 the date the notice of rejection was sent to the person and before
36-26 the third anniversary of the date of dissolution; and
36-27 (3) the date the notice of rejection was sent and the
37-1 date of dissolution.
37-2 F. A person's claim against a dissolved corporation is
37-3 extinguished if:
37-4 (1) a written presentation of that claim meeting the
37-5 requirements of this article is not received at the address of the
37-6 dissolved corporation stated in the notice to the person on or
37-7 before the date stated in the notice; or
37-8 (2) an action or proceeding on the claim is not
37-9 brought within 180 days after the date a notice of rejection was
37-10 sent to the person and before the third anniversary of the date of
37-11 dissolution.
37-12 G. A dissolved corporation that was dissolved by the
37-13 expiration of the period of its duration may, during the three-year
37-14 period following the date of dissolution, amend its articles of
37-15 incorporation by following the procedure prescribed in this Act to
37-16 extend or perpetuate its period of existence. That expiration
37-17 shall not of itself create any vested right on the part of any
37-18 member or creditor to prevent such an action. No act or contract
37-19 of a dissolved corporation during a period within which it could
37-20 have extended its existence as permitted by this Article, whether
37-21 or not it has taken action so to extend its existence, shall be in
37-22 any degree invalidated by the expiration of its period of duration.
37-23 H. In this article:
37-24 (1) "Dissolved corporation" means a corporation that
37-25 was dissolved:
37-26 (a) by the issuance of a certificate of
37-27 dissolution or other action by the Secretary of State;
38-1 (b) by a decree of a court when the court has
38-2 not liquidated all the assets and affairs of the corporation as
38-3 provided in this Act; or
38-4 (c) by expiration of its period of duration if
38-5 the corporation has not revived its existence as provided in this
38-6 Act.
38-7 (2) "Claim" means a right to payment, damages, or
38-8 property, whether liquidated or unliquidated, accrued or
38-9 contingent, matured or unmatured.
38-10 (3) "Existing claim" means a claim that existed before
38-11 dissolution and is not otherwise barred by limitations or a
38-12 contractual obligation incurred after dissolution.
38-13 SECTION 27. Section B, Article 8.01, Texas Non-Profit
38-14 Corporation Act (Article 1396-8.01, Vernon's Texas Civil Statutes),
38-15 is amended to read as follows:
38-16 B. Without excluding other activities which may not
38-17 constitute conducting affairs in this State, a foreign corporation
38-18 shall not be considered to be conducting affairs in this State, for
38-19 the purposes of this Act, by reason of carrying on in this State
38-20 any one (1) or more of the following activities:
38-21 (1) Maintaining or defending any action or suit or any
38-22 administration or arbitration proceedings, or affecting the
38-23 settlement thereof or the settlement of claims or disputes to which
38-24 it is a party.
38-25 (2) Holding meetings of its directors or members or
38-26 carrying on other activities concerning its internal affairs.
38-27 (3) Maintaining bank accounts.
39-1 (4) Maintaining offices or agencies for the transfer,
39-2 exchange, and registration of securities issued by it, or
39-3 appointing and maintaining trustees or depositaries with relation
39-4 to its securities.
39-5 (5) Voting the stock of any corporation which it has
39-6 lawfully acquired.
39-7 (6) <(5)> Effecting sales through independent
39-8 contractors.
39-9 (7) Creating as borrower or lender, or acquiring,
39-10 indebtedness or mortgages or other security interests in real or
39-11 personal property <(6) Creating evidence of debt, mortgages, or
39-12 liens on real or personal property>.
39-13 (8) <(7)> Securing or collecting debts due to it or
39-14 enforcing any rights in property securing the same.
39-15 (9) <(8)> Conducting any affairs in interstate
39-16 commerce.
39-17 (10) <(9)> Conducting an isolated transaction
39-18 completed within a period of thirty (30) days and not in the course
39-19 of a number of repeated transactions of like nature.
39-20 (11) <(10)> Exercising the powers of executor or
39-21 administrator of the estate of a non-resident decedent under
39-22 ancillary letters issued by a court of this State, or exercising
39-23 the powers of a trustee under the will of a non-resident decedent,
39-24 or under a trust created by a person, corporation or association,
39-25 non-resident of this State, if the exercise of such powers in such
39-26 case will not involve activities which would be deemed to
39-27 constitute the transacting of business in this State in the case of
40-1 a foreign corporation acting in its own right.
40-2 (12) <(11)> Acquiring, in transactions outside Texas,
40-3 or in interstate commerce, of debts secured by mortgages or liens
40-4 on real or personal property in Texas, collecting or adjusting of
40-5 principal and interest payments thereon, enforcing or adjusting any
40-6 rights and property securing said debts, taking any actions
40-7 necessary to preserve and protect the interest of the mortgagee in
40-8 said security, or any combinations of such transactions.
40-9 (13) <(12)> Investing in or acquiring, in transactions
40-10 outside of Texas, royalties and other non-operating mineral
40-11 interests, and the execution of division orders, contracts of sale
40-12 and other instruments incidental to the ownership of such
40-13 non-operating mineral interests.
40-14 SECTION 28. Section A, Article 8.04, Texas Non-Profit
40-15 Corporation Act (Article 1396-8.04, Vernon's Texas Civil Statutes),
40-16 is amended to read as follows:
40-17 A. A foreign corporation, in order to procure a certificate
40-18 of authority to conduct affairs in this State, shall make
40-19 application therefor to the Secretary of State, which application
40-20 shall set forth:
40-21 (1) The name of the corporation and the state or
40-22 country under the laws of which it is incorporated and, if the
40-23 corporation is required to qualify under a name other than its
40-24 corporate name, the name under which the corporation is to be
40-25 qualified.
40-26 (2) A statement that the corporation is a non-profit
40-27 corporation.
41-1 (3) The date of incorporation and the period of
41-2 duration of the corporation.
41-3 (4) The street address of the principal office of the
41-4 corporation in the state or country under the laws of which it is
41-5 incorporated.
41-6 (5) The street address of the proposed registered
41-7 office of the corporation in this State, and the name of its
41-8 proposed registered agent in this State at such address.
41-9 (6) The purpose or purposes of the corporation which
41-10 it proposes to pursue in conducting its affairs in this State.
41-11 (7) The names and respective addresses of the
41-12 directors and officers of the corporation.
41-13 (8) A statement of whether or not the corporation has
41-14 members.
41-15 (9) Such additional information as may be necessary or
41-16 appropriate in order to enable the Secretary of State to determine
41-17 whether such corporation is entitled to a certificate of authority
41-18 to conduct affairs in this State.
41-19 SECTION 29. Article 8.06, Texas Non-Profit Corporation Act
41-20 (Article 1396-8.06, Vernon's Texas Civil Statutes), is amended to
41-21 read as follows:
41-22 Art. 8.06. Effect of Certificate of Authority. A. Upon the
41-23 issuance of a certificate of authority by the Secretary of State,
41-24 the corporation shall be authorized to conduct affairs in this
41-25 State for those purposes set forth in its application and the
41-26 certificate shall be conclusive evidence of the right of the
41-27 corporation to conduct affairs in this State for that purpose,
42-1 except as against this State in a proceeding to revoke the
42-2 certificate<, subject, however, to the right of this State to
42-3 revoke such authority as provided in this Act>.
42-4 SECTION 30. Section A, Article 8.08, Texas Non-Profit
42-5 Corporation Act (Article 1396-8.08, Vernon's Texas Civil Statutes),
42-6 is amended to read as follows:
42-7 A. A foreign corporation authorized to conduct affairs in
42-8 this state may change its registered office or change its
42-9 registered agent, or both, upon filing in the office of the
42-10 Secretary of State a statement setting forth:
42-11 (1) The name of the corporation.
42-12 (2) The street <post-office> address of its then
42-13 registered office.
42-14 (3) If the street <post-office> address of its
42-15 registered office is to be changed, the street <post-office>
42-16 address to which the registered office is to be changed.
42-17 (4) The name of its then registered agent.
42-18 (5) If its registered agent is to be changed, the name
42-19 of its successor registered agent.
42-20 (6) That the street <post-office> address of its
42-21 registered office and the post-office address of the business
42-22 office of its registered agent, as changed, will be identical.
42-23 (7) That such change was authorized by its Board of
42-24 Directors or by an officer of the corporation so authorized by the
42-25 Board of Directors, or if the management of the corporation is
42-26 vested in its members pursuant to Article 2.14C of this Act, by the
42-27 members.
43-1 SECTION 31. Article 8.12, Texas Non-Profit Corporation Act
43-2 (Article 1396-8.12, Vernon's Texas Civil Statutes), is amended to
43-3 read as follows:
43-4 Art. 8.12. Amended Certificate of Authority. A. If a
43-5 foreign corporation authorized to conduct affairs in this State
43-6 changes its corporate name or desires to pursue in this State
43-7 purposes other than or in addition to the purposes authorized by
43-8 its existing certificate of authority, the corporation shall file
43-9 with the Secretary of State an application for amended certificate
43-10 of authority setting forth the change <A foreign corporation
43-11 authorized to conduct affairs in this State shall procure an
43-12 amended certificate of authority in the event it changes its
43-13 corporate name, or desires to pursue in this State other or
43-14 additional purposes than those set forth in its prior application
43-15 for a certificate of authority, by making application therefor to
43-16 the Secretary of State>.
43-17 B. A foreign corporation may change any other statement on
43-18 its original application for certificate of authority or any
43-19 amendment to that certificate by filing with the Secretary of State
43-20 an application for an amended certificate of authority setting
43-21 forth the change <Any other statement on the original application
43-22 for a certificate of authority may be changed by filing an
43-23 application for an amended certificate of authority setting forth
43-24 the change>.
43-25 C. An application for an amended certificate of authority
43-26 submitted because of a name change must be accompanied by a
43-27 certificate from the proper filing officer in the jurisdiction of
44-1 incorporation evidencing the name change.
44-2 D. The requirements in respect to the form and contents of
44-3 such application, the manner of its execution, the filing of the
44-4 original and a copy of the application with the Secretary of State,
44-5 the issuance of an amended certificate of authority and the effect
44-6 thereof, shall be the same as in the case of an original
44-7 application for a certificate of authority.
44-8 SECTION 32. Section A, Article 8.13, Texas Non-Profit
44-9 Corporation Act (Article 1396-8.13, Vernon's Texas Civil Statutes),
44-10 is amended to read as follows:
44-11 A. A foreign corporation authorized to conduct affairs in
44-12 this State may withdraw from this State upon procuring from the
44-13 Secretary of State a certificate of withdrawal. In order to
44-14 procure such certificate of withdrawal, such foreign corporation
44-15 shall deliver to the Secretary of State an application for
44-16 withdrawal, which shall set forth:
44-17 (1) The name of the corporation and the state or
44-18 country under the laws of which it is incorporated.
44-19 (2) That the corporation is not conducting affairs in
44-20 this State.
44-21 (3) That the corporation surrenders its authority to
44-22 conduct affairs in this State.
44-23 (4) That the corporation revokes the authority of its
44-24 registered agent in this State to accept service of process and
44-25 consents that service of process in any action, suit or proceeding
44-26 based upon any cause of action arising in this State during the
44-27 time the corporation was authorized to conduct affairs in this
45-1 State may thereafter be made on such corporation by service thereof
45-2 on the Secretary of State.
45-3 (5) A street or post office address to which the
45-4 Secretary of State may mail a copy of any process against the
45-5 corporation that may be served on him.
45-6 (6) A statement that all sums due, or accrued, to this
45-7 State have been paid, or that adequate provision has been made for
45-8 the payment thereof.
45-9 (7) A statement that all known creditors or claimants
45-10 have been paid or provided for and that the corporation is not
45-11 involved in or threatened with litigation in any court in this
45-12 State, or that adequate provision has been made for the
45-13 satisfaction of any judgment, order or decree which may be entered
45-14 against it in any pending suits.
45-15 SECTION 33. Section B, Article 8.15, Texas Non-Profit
45-16 Corporation Act (Article 1396-8.15, Vernon's Texas Civil Statutes),
45-17 is amended to read as follows:
45-18 B. The certificate of authority of a foreign corporation to
45-19 conduct affairs in this State <state> may be revoked by order of
45-20 the Secretary of State when it is established that it is in default
45-21 in any of the following particulars:
45-22 (1) The corporation has failed to file any report
45-23 within the time required by law, or has failed to pay any fees,
45-24 franchise taxes, or penalties prescribed by law when the same have
45-25 become due and payable; or
45-26 (2) The corporation has failed to maintain a
45-27 registered agent in this State <state> as required by law; or
46-1 (3) The corporation has changed its corporate name or
46-2 the purposes authorized by its existing certificate of authority
46-3 <its corporate name> and has failed to file with the Secretary of
46-4 State within thirty days after such change <of name> became
46-5 effective, an application for an amended certificate of authority,
46-6 or that the corporation has changed its corporate name and that the
46-7 newly adopted name is not available for use in this State <state>;
46-8 or
46-9 (4) The corporation has failed to pay the filing fee
46-10 for the corporation's certificate of authority, or the fee was paid
46-11 by an instrument that was dishonored when presented by this State
46-12 <the state> for payment.
46-13 SECTION 34. Section A, Article 9.03, Texas Non-Profit
46-14 Corporation Act (Article 1396-9.03, Vernon's Texas Civil Statutes),
46-15 is amended to read as follows:
46-16 A. The Secretary of State shall charge and collect for:
46-17 (1) Filing articles of incorporation and issuing a
46-18 certificate of incorporation, Twenty-five Dollars ($25).
46-19 (2) Filing articles of amendment and issuing a
46-20 certificate of amendment, Twenty-five Dollars ($25).
46-21 (3) Filing articles of merger or consolidation and
46-22 issuing a certificate of merger or consolidation, Fifty Dollars
46-23 ($50).
46-24 (4) Filing a statement of change of address of
46-25 registered office or change of registered agent, or both, Five
46-26 Dollars ($5).
46-27 (5) Filing articles of dissolution, Five Dollars ($5).
47-1 (6) Filing an application of a foreign corporation for
47-2 a certificate of authority to conduct affairs in this state and
47-3 issuing a certificate of authority, Twenty-five Dollars ($25).
47-4 (7) Filing an application of a foreign corporation for
47-5 an amended certificate of authority to conduct affairs in this
47-6 state and issuing an amended certificate of authority, Twenty-five
47-7 Dollars ($25).
47-8 (8) Filing an application for withdrawal of a foreign
47-9 corporation and issuing a certificate of withdrawal, Five Dollars
47-10 ($5).
47-11 (9) Filing any other statement or report of a domestic
47-12 or foreign corporation, Five Dollars ($5).
47-13 (10) Filing restatement of articles of incorporation,
47-14 Fifty Dollars ($50).
47-15 (11) Filing a statement of change of address of
47-16 registered agent, Fifteen Dollars ($15.00), except that the maximum
47-17 fee for simultaneous filings by a registered agent for more than
47-18 one corporation may not exceed Two Hundred Fifty Dollars ($250.00).
47-19 SECTION 35. Article 9.10, Texas Non-Profit Corporation Act
47-20 (Article 1396-9.10, Vernon's Texas Civil Statutes), is amended by
47-21 adding Section C to read as follows:
47-22 C. (1) The articles of incorporation may provide that any
47-23 action required by this Act to be taken at a meeting of the members
47-24 or directors of a corporation or any action that may be taken at a
47-25 meeting of the members or directors or of any committee may be
47-26 taken without a meeting if a consent in writing, setting forth the
47-27 action to be taken, is signed by a sufficient number of members,
48-1 directors, or committee members as would be necessary to take that
48-2 action at a meeting at which all of the members, directors, or
48-3 members of the committee were present and voted.
48-4 (2) Each written consent shall bear the date of
48-5 signature of each member, director, or committee member who signs
48-6 the consent. A written consent signed by less than all of the
48-7 members, directors, or committee members is not effective to take
48-8 the action that is the subject of the consent unless, within 60
48-9 days after the date of the earliest dated consent delivered to the
48-10 corporation in the manner required by this article, a consent or
48-11 consents signed by the required number of members, directors, or
48-12 committee members is delivered to the corporation at its registered
48-13 office, registered agent, principal place of business, transfer
48-14 agent, registrar, exchange agent, or an officer or agent of the
48-15 corporation having custody of the books in which proceedings of
48-16 meetings of members, directors, or committees are recorded.
48-17 Delivery shall be by hand or certified or registered mail, return
48-18 receipt requested. Delivery to the corporation's principal place
48-19 of business shall be addressed to the president or principal
48-20 executive officer of the corporation.
48-21 (3) Prompt notice of the taking of any action by
48-22 members, directors, or a committee without a meeting by less than
48-23 unanimous written consent shall be given to all members, directors,
48-24 or committee members who did not consent in writing to the action.
48-25 (4) If any action by members, directors, or a
48-26 committee is taken by written consent signed by less than all of
48-27 the members, directors, or committee members, any articles or
49-1 documents filed with the Secretary of State as a result of the
49-2 taking of the action shall state, in lieu of any statement required
49-3 by this Act concerning any vote of the members or directors, that
49-4 written consent has been given in accordance with the provisions of
49-5 this article and that any written notice required by this article
49-6 has been given.
49-7 (5) A telegram, telex, cablegram, or similar
49-8 transmission by a member, director, or member of a committee or a
49-9 photographic, photostatic, facsimile, or similar reproduction of a
49-10 writing signed by a member, director, or member of a committee
49-11 shall be regarded as signed by the member, director, or member of a
49-12 committee for purposes of this article.
49-13 SECTION 36. Article 10.04, Texas Non-Profit Corporation Act
49-14 (Article 1396-10.04, Vernon's Texas Civil Statutes), is amended to
49-15 read as follows:
49-16 Art. 10.04. To What Corporations This Act Applies; Procedure
49-17 for Adoption of Act by Existing Corporation. A. Except as
49-18 otherwise provided by this article, this Act does not apply to
49-19 domestic corporations organized under any statute other than this
49-20 Act or to any foreign corporations granted authority to conduct
49-21 affairs within this State under any statute other than this Act.
49-22 If any domestic corporation is organized under or is governed by a
49-23 statute that does not contain a provision regarding a matter
49-24 provided for in this Act, or any foreign corporation is granted
49-25 authority to conduct affairs within this State under a statute that
49-26 does not contain a provision regarding a matter provided for in
49-27 this Act in respect of foreign corporations, or if a statute
50-1 specifically provides that the general laws for incorporation or
50-2 for the granting of a certificate of authority to conduct affairs
50-3 in this State supplement the provisions of that statute, the
50-4 provisions of this Act apply only to the extent not inconsistent
50-5 with the provisions of the other statute. <Until September 1,
50-6 1961, this Act shall not apply to any domestic corporation duly
50-7 chartered and existing on the effective date of this Act, or to any
50-8 foreign corporation, unless such domestic corporation shall
50-9 voluntarily elect to adopt the provisions of this Act and shall
50-10 comply with the procedure prescribed by Section B of this Article,
50-11 and unless such foreign corporation shall procure a certificate of
50-12 authority pursuant to Part Eight of this Act.>
50-13 <B. From and after the effective date of this Act and prior
50-14 to September 1, 1961, any domestic corporation duly chartered and
50-15 existing on the effective date of this Act may voluntarily elect to
50-16 adopt the provisions of this Act and may become subject to its
50-17 provisions by taking the following steps:>
50-18 <(1) A resolution reciting that the corporation
50-19 voluntarily adopts this Act shall be adopted by the board of
50-20 directors and/or the members in accordance with the procedure
50-21 prescribed by this Act for the amendment of articles of
50-22 incorporation of such corporation.>
50-23 <(2) Upon adoption of the required resolution or
50-24 resolutions, an instrument shall be executed in duplicate by the
50-25 corporation by its president or a vice-president and by its
50-26 secretary or an assistant secretary, and verified by one of the
50-27 officers signing such statement, which shall set forth:>
51-1 <(a) The name of the corporation.>
51-2 <(b) Each resolution adopted by the corporation.>
51-3 <(c) The date of the adoption of each
51-4 resolution.>
51-5 <(d) The street address of its initial
51-6 registered office and the name of its initial registered agent at
51-7 such address.>
51-8 <(3) Duplicate originals of such document shall be
51-9 delivered to the Secretary of State. If the Secretary of State
51-10 finds that such document conforms to law, he shall, when all fees
51-11 and franchise taxes have been paid as prescribed by law:>
51-12 <(a) Endorse on each of such duplicate originals
51-13 the word "Filed," and the month, day, and year of the filing
51-14 thereof.>
51-15 <(b) File one of such duplicate originals in his
51-16 office.>
51-17 <(c) Deliver the other duplicate original to the
51-18 corporation or its representative.>
51-19 <(4) Upon the filing of such document, all provisions
51-20 of this Act shall thereafter apply to the corporation; provided,
51-21 however, that such delivery to and filing by the Secretary of State
51-22 need not precede action by the directors and/or the members of a
51-23 corporation in connection with amendments to its articles of
51-24 incorporation or its by-laws under this Act so long as (a) such
51-25 amendments do not become effective until after the Secretary of
51-26 State has filed the document whereby such corporation adopts this
51-27 Act and (b) the procedures and requirements of this Act for the
52-1 adoption of such amendments, including requirements as to notice,
52-2 shall have been complied with and satisfied.>
52-3 <C. Except for the exceptions and limitations of Section A
52-4 of this Article, this Act shall apply to all domestic corporations
52-5 organized after the date on which this Act becomes effective and to
52-6 all domestic corporations electing to adopt this Act and
52-7 manifesting their election in the manner provided in Section B of
52-8 this Article, prior to September 1, 1961.>
52-9 <D. From and after September 1, 1961, this Act shall apply
52-10 to all domestic corporations and to all foreign corporations
52-11 conducting or seeking to conduct affairs within this State. Those
52-12 domestic corporations existing at the time that this Act becomes
52-13 effective which have not meanwhile adopted this Act by complying
52-14 with Section B of this Article shall, on September 1, 1961, be
52-15 deemed to have elected to adopt this Act by not voluntarily
52-16 dissolving.>
52-17 <E. No foreign corporation shall conduct affairs in this
52-18 State after September 1, 1961, unless and until it shall have
52-19 procured a certificate of authority in accordance with the
52-20 requirements of Part Eight of this Act. Such certificates may be
52-21 applied for and issued at any time after the effective date of this
52-22 Act and this Act shall thereafter apply to such corporation from
52-23 the date of the issuance of its certificate of authority; provided,
52-24 however, that if such corporation expressly so requests in its
52-25 application, the effective date of its certificate may be delayed
52-26 until September 1, 1961, even though issued prior to such date.>
52-27 B. <F.> In so far as the same are not inconsistent with or
53-1 contrary to any applicable provision of the Insurance Code of
53-2 Texas, or any amendment thereto, the provisions of this Act shall
53-3 apply to and govern burial associations as defined in Article
53-4 14.37, Texas Insurance Code local mutual aid associations,
53-5 statewide mutual assessment corporations, and county mutual
53-6 insurance companies; provided however, (a) that any such mutual
53-7 insurance associations or companies may, upon advance approval of
53-8 the Commissioner of Insurance, pay dividends to its members, and
53-9 (b) that wherever in this Act some duty, responsibility, power,
53-10 authority, or act is vested in, required of, or to be performed by
53-11 the Secretary of State, such is to be vested in, required of, or
53-12 performed by the Commissioner of Insurance in so far as such mutual
53-13 insurance companies or associations are concerned.
53-14 C. <G.> This Act shall not apply to those corporations
53-15 excepted under Article 2.01 B, Subsections (3), (4), and (5) of
53-16 this Act; provided however, that if any of said excepted domestic
53-17 corporations were heretofore or are hereafter organized not for
53-18 profit under special statutes which contain no provisions in regard
53-19 to some of the matters provided for in this Act, or if such special
53-20 statutes specifically applicable provide that the general laws for
53-21 incorporation shall supplement the provisions of such statutes,
53-22 then the provisions of this Act shall apply to the extent that they
53-23 are not inconsistent with the provisions of such special statutes.
53-24 SECTION 37. The Texas Non-Profit Corporation Act (Article
53-25 1396-1.01 et seq., Vernon's Texas Civil Statutes) is amended by
53-26 adding Article 10.07 to read as follows:
53-27 Art. 10.07. DELAYED EFFECTIVENESS OF CERTAIN FILINGS. A.
54-1 In this article the following are permitted acts:
54-2 (1) the incorporation of a corporation under this Act;
54-3 (2) an amendment to a corporation's articles of
54-4 incorporation;
54-5 (3) the restatement of articles of incorporation of a
54-6 corporation;
54-7 (4) a voluntary dissolution;
54-8 (5) the authorization or withdrawal of a foreign
54-9 corporation to conduct affairs in this State;
54-10 (6) an amendment to the certificate of authority of a
54-11 foreign corporation;
54-12 (7) a change in registered office or registered agent;
54-13 (8) a change of address of a registered agent; or
54-14 (9) a merger or consolidation of domestic corporations
54-15 or of domestic and foreign corporations.
54-16 B. A permitted act may be made effective as of a time and
54-17 date after the time and date otherwise provided in this Act or may
54-18 be made effective on the occurrence of events or facts that may
54-19 occur in the future. Those events or facts may include future acts
54-20 of any person or entity, if:
54-21 (1) the articles, statement, application, or other
54-22 filing that is required by this Act to be filed with the Secretary
54-23 of State to make the permitted act effective clearly and expressly
54-24 sets forth, in addition to any other statement or information
54-25 required to be set forth:
54-26 (a) the time and date on which the permitted act
54-27 is to become effective; or
55-1 (b) if the permitted act is to become effective
55-2 on the occurrence of events or facts that may occur in the future,
55-3 the manner in which the events or facts will operate to cause the
55-4 permitted act to become effective;
55-5 (2) in the case of a permitted act that is to become
55-6 effective on the mere passage of time as of a time or date after
55-7 the time and date otherwise provided in this Act, the subsequent
55-8 time and date must not be more than 90 days after the date of the
55-9 filing of the articles, statement, application, or other filing
55-10 that is otherwise required by this Act to be filed with the
55-11 Secretary of State to make effective the permitted act; and
55-12 (3) in the case of a permitted act that is to be made
55-13 effective on the occurrence of events or facts that may occur in
55-14 the future, other than the mere passage of time, a statement that
55-15 all the events or facts on which the effectiveness of the permitted
55-16 act is conditioned have been satisfied or waived and the date on
55-17 which the condition was satisfied or waived must be filed with the
55-18 Secretary of State within 90 days of the date of the filing of the
55-19 articles, statement, application, or other filing that is otherwise
55-20 required by this Act for the permitted act to become effective.
55-21 C. The statement required by Section A(3) of this article
55-22 shall be executed on behalf of each domestic or foreign corporation
55-23 or other entity that was required to execute the articles,
55-24 statement, application, or other filing that is otherwise required
55-25 by this Act to be filed with the Secretary of State to make
55-26 effective the permitted act by an officer or other duly authorized
55-27 representative, including an officer or duly authorized
56-1 representative of any successor domestic or foreign corporation or
56-2 other entity, and an original and copy shall be filed with the
56-3 Secretary of State. If the Secretary of State finds that the
56-4 statement conforms to the provisions of this Act, the Secretary of
56-5 State shall:
56-6 (1) endorse on the original and the copy the word
56-7 "Filed" and the month, day, and year of the filing;
56-8 (2) file the original in the Secretary of State's
56-9 office; and
56-10 (3) return the copy to the filing party or its
56-11 representative.
56-12 D. If any permitted act is to become effective as of a time
56-13 or date after the time and date otherwise provided in this Act, for
56-14 the permitted act to become effective, notwithstanding any other
56-15 provision of this Act to the contrary, the permitted act shall
56-16 become, to the extent permitted by Section A of this article,
56-17 effective as of the subsequent time and date, and any certificate
56-18 issued by the Secretary of State on the filing of the articles,
56-19 statement, application, or other filing that is otherwise required
56-20 by this Act for the permitted act to become effective shall
56-21 expressly state the time and date on which the permitted act is to
56-22 become effective.
56-23 E. If a permitted act is to be made effective on the
56-24 occurrence of events or facts that may occur in the future, other
56-25 than the mere passage of time, and the statement required by
56-26 Section A(3) of this article is filed with the Secretary of State
56-27 within the time prescribed, the permitted act becomes effective as
57-1 of the time and date on which the latest specified event or fact
57-2 occurs or the time and date on which the condition is otherwise
57-3 satisfied or waived. Any certificate issued or notation,
57-4 acknowledgement, or other statement made by the Secretary of State
57-5 on the filing of the articles, statement, application, or other
57-6 filing that is otherwise required by this Act for the permitted act
57-7 to become effective shall state that "The effectiveness of the
57-8 action to which this instrument relates is conditioned on the
57-9 occurrence of certain facts or events described in the filing to
57-10 which this instrument relates" or shall make reference in a manner
57-11 the Secretary of State approves, to the fact that the effectiveness
57-12 of the action is conditioned. The time and date on which a
57-13 condition to the effectiveness of a permitted act is satisfied or
57-14 waived as set forth in a statement filed with the Secretary of
57-15 State pursuant to Section A(3) of this article shall be
57-16 conclusively regarded as the time and date on which the condition
57-17 was satisfied or waived for purposes of this article.
57-18 F. If the effectiveness of any permitted act is conditioned
57-19 on the occurrence of events or facts that may occur in the future,
57-20 other than the mere passage of time, and the statement required by
57-21 Section A(3) of this article is not filed with the Secretary of
57-22 State within the time prescribed, the permitted act is not
57-23 effective unless there is subsequently filed with the Secretary of
57-24 State the articles, statement, application, or other filing
57-25 required by this Act to be filed with the Secretary of State to
57-26 make the permitted act effective.
57-27 SECTION 38. This Act takes effect January 1, 1994.
58-1 SECTION 39. The importance of this legislation and the
58-2 crowded condition of the calendars in both houses create an
58-3 emergency and an imperative public necessity that the
58-4 constitutional rule requiring bills to be read on three several
58-5 days in each house be suspended, and this rule is hereby suspended.