By: Turner, Sylvester H.B. No. 1494
73R2320 CAE-F
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 Subdivision (14) 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 SECTION 2. The Texas Non-Profit Corporation Act (Article
1-11 1396-1.01 et seq., Vernon's Texas Civil Statutes) is amended by
1-12 adding Article 2.04A to read as follows:
1-13 Art. 2.04A. RESERVED NAME. A. The exclusive right to the
1-14 use of a corporate name may be reserved by:
1-15 (1) a person intending to organize a corporation under
1-16 this Act;
1-17 (2) a domestic corporation intending to change its
1-18 name;
1-19 (3) a foreign corporation intending to apply for a
1-20 certificate of authority to conduct affairs in this State;
1-21 (4) a foreign corporation authorized to conduct
1-22 affairs in this State and intending to change its name; or
1-23 (5) a person intending to organize a foreign
1-24 corporation and intending to have that corporation apply for a
2-1 certificate of authority to conduct affairs in this State.
2-2 B. An application for name reservation or transfer of the
2-3 exclusive use of a specified corporate name is subject to the
2-4 procedures and period prescribed by Article 2.06, Texas Business
2-5 Corporation Act.
2-6 SECTION 3. Article 2.05, Texas Non-Profit Corporation Act
2-7 (Article 1396-2.05, Vernon's Texas Civil Statutes), is amended to
2-8 read as follows:
2-9 Art. 2.05. Registered Office and Registered Agent. A. Each
2-10 corporation shall have and continuously maintain in this State:
2-11 (1) A registered office which may be, but need not be,
2-12 the same as its principal office.
2-13 (2) A registered agent, which agent may be an
2-14 individual resident in this State whose business office is
2-15 identical with such registered office, or a domestic corporation,
2-16 whether for profit or not for profit, or a foreign corporation,
2-17 whether for profit or not for profit, authorized to transact
2-18 business or to conduct its affairs in this State which has a
2-19 <principal or> business office identical with such registered
2-20 office.
2-21 <B. On or before the 15th day of November, 1961, each not
2-22 for profit corporation organized under the laws of this State prior
2-23 to the effective date of this Act shall designate its registered
2-24 office and appoint its registered agent by filing in the office of
2-25 the Secretary of State a statement setting forth:>
2-26 <(1) The name of the corporation.>
2-27 <(2) The street address of its registered office.>
3-1 <(3) The name of its registered agent.>
3-2 <(4) The street address of its registered agent.>
3-3 <(5) That the street address of its registered office
3-4 and the street address of its registered agent are the same.>
3-5 <(6) That such designation and appointment were
3-6 authorized by resolution duly adopted by its board of directors or,
3-7 if the management of the corporation is vested in its members
3-8 pursuant to Article 2.14C of this Act, by the members.>
3-9 <C. The statement required by this Article shall be executed
3-10 by the corporation by its president or a vice-president, and
3-11 verified by him. The original and a copy of the statement shall be
3-12 delivered to the Secretary of State. If the Secretary of State
3-13 finds that such statement conforms to the provisions of this Act,
3-14 he shall, when all fees have been paid as prescribed by law:>
3-15 <(1) Endorse on the original and the copy the word
3-16 "Filed" and the month, day, and year of the filing thereof.>
3-17 <(2) File the original in his office.>
3-18 <(3) Deliver the copy to the corporation or its
3-19 representative.>
3-20 <D. Upon such filing the designation of the registered
3-21 office and the appointment of the registered agent shall become
3-22 effective.>
3-23 SECTION 4. The Texas Non-Profit Corporation Act (Article
3-24 1396-1.01 et seq., Vernon's Texas Civil Statutes) is amended by
3-25 adding Article 2.06A to read as follows:
3-26 Art. 2.06A. CHANGE OF ADDRESS OF REGISTERED AGENT. A. The
3-27 location of the registered office in this State for a corporation
4-1 may be changed from one address to another by filing in the office
4-2 of the Secretary of State a statement with:
4-3 (1) the name of the corporation represented by the
4-4 registered agent;
4-5 (2) the street address at which the registered agent
4-6 has maintained the registered office for that corporation;
4-7 (3) the new street address at which the registered
4-8 agent will maintain the registered office for that corporation; and
4-9 (4) a statement that notice of the change has been
4-10 given to the corporation in writing at least ten (10) days before
4-11 the date of the filing.
4-12 B. The statement required by this article shall be signed by
4-13 the registered agent or, if the agent is a corporation, by an
4-14 officer of the corporate agent on its behalf. If the registered
4-15 agent is simultaneously filing statements for more than one
4-16 corporation, each statement may contain facsimile signatures in the
4-17 execution. The original and one copy of the statement shall be
4-18 delivered to the Secretary of State. If the Secretary of State
4-19 finds that the statement conforms to this Act, the Secretary of
4-20 State shall:
4-21 (1) endorse on the original and the copy the word
4-22 "Filed," and the month, day, and year of the filing;
4-23 (2) file the original in the Secretary of State's
4-24 office; and
4-25 (3) return the copy to the registered agent.
4-26 C. The registered office of the corporation named in the
4-27 statement shall be changed to the new street address of the
5-1 registered agent on the filing of the statement by the Secretary of
5-2 State.
5-3 SECTION 5. Article 2.09, Texas Non-Profit Corporation Act
5-4 (Article 1396-2.09, Vernon's Texas Civil Statutes), is amended to
5-5 read as follows:
5-6 Art. 2.09. By-Laws. A. The initial by-laws of a
5-7 corporation shall be adopted by its board of directors or, if the
5-8 management of the corporation is vested in its members <pursuant to
5-9 Article 2.14C of this Act>, by the members. <The power to alter,
5-10 amend, or repeal the by-laws or to adopt new by-laws shall be
5-11 vested in the members, if any, but such power may be delegated by
5-12 the members to the board of directors. In the event the
5-13 corporation has no members, the power to alter, amend, or repeal
5-14 the by-laws or to adopt new by-laws shall be vested in the board of
5-15 directors.> The by-laws may contain any provisions for the
5-16 regulation and management of the affairs of the <a> corporation not
5-17 inconsistent with law or <with> the articles of incorporation.
5-18 B. A corporation's board of directors may amend or repeal
5-19 the corporation's by-laws, or adopt new by-laws, unless:
5-20 (1) the articles of incorporation or this Act reserves
5-21 the power exclusively to the members in whole or in part;
5-22 (2) the management of the corporation is vested in its
5-23 members; or
5-24 (3) the members in amending, repealing, or adopting a
5-25 particular by-law expressly provide that the board of directors may
5-26 not amend or repeal that by-law.
5-27 C. If a corporation has no members or no members with voting
6-1 rights, its articles of incorporation or by-laws may contain a
6-2 provision that vests the power to approve any amendments to the
6-3 by-laws in the board of directors or the members of another
6-4 association or corporation organized under the laws of this State
6-5 or another state. If that provision is contained in a
6-6 corporation's articles of incorporation or by-laws, amendments to
6-7 that corporation's by-laws are not effective until they are
6-8 approved by the entity designated in the corporation's articles of
6-9 incorporation or by-laws, as appropriate.
6-10 SECTION 6. Section A, Article 2.11, Texas Non-Profit
6-11 Corporation Act (Article 1396-2.11, Vernon's Texas Civil Statutes),
6-12 is amended to read as follows:
6-13 A. In the case of a corporation other than a church, written
6-14 or printed notice stating the place, day, and <or> hour of the
6-15 meeting and, in case of a special meeting, the purpose or purposes
6-16 for which the meeting is called, shall be delivered not less than
6-17 ten (10) nor more than sixty (60) <fifty (50)> days before the date
6-18 of the meeting, either personally, by facsimile transmission, or by
6-19 mail, by or at the direction of the president, or the secretary, or
6-20 the officers or persons calling the meeting, to each member
6-21 entitled to vote at such meeting. If mailed, such notice shall be
6-22 deemed to be delivered when deposited in the United States mail
6-23 addressed to the member at his address as it appears on the records
6-24 of the corporation, with postage thereon paid. If transmitted by
6-25 facsimile, notice is deemed to be delivered on successful
6-26 transmission of the facsimile.
6-27 SECTION 7. The Texas Non-Profit Corporation Act (Article
7-1 1396-1.01 et seq., Vernon's Texas Civil Statutes), is amended by
7-2 adding Articles 2.11A and 2.11B to read as follows:
7-3 Art. 2.11A. RECORD DATE FOR DETERMINING MEMBERS ENTITLED TO
7-4 NOTICE AND VOTE. A. The by-laws of a corporation may fix or
7-5 provide the manner of fixing a date as the record date for
7-6 determining the members entitled to notice of a members' meeting.
7-7 If the by-laws do not fix and do not provide for fixing the record
7-8 date, the board of directors may fix a future date as the record
7-9 date. If a record date is not fixed, members at the close of
7-10 business on the business day preceding the date on which notice is
7-11 given, or if notice is waived, at the close of business on the
7-12 business day preceding the date on which notice of the meeting is
7-13 given, are entitled to notice of the meeting.
7-14 B. The by-laws of a corporation may fix or provide the
7-15 manner of fixing a date as the record date for determining the
7-16 members entitled to vote at a members' meeting. If the by-laws do
7-17 not fix and do not provide for fixing a record date, the board may
7-18 fix a future date as the record date. If a record date is not
7-19 fixed, members on the date of the meeting who are otherwise
7-20 eligible to vote are entitled to vote at the meeting.
7-21 C. The by-laws may fix or provide the manner for fixing a
7-22 date as the record date for the purpose of determining the members
7-23 entitled to exercise any rights regarding any other lawful action.
7-24 If the by-laws do not fix and do not provide for fixing a record
7-25 date, the board of directors may fix in advance a record date. If
7-26 a record date is not fixed, members at the close of business on the
7-27 date on which the board of directors adopts the resolution relating
8-1 to the record date, or the 60th day before the date of the other
8-2 action, whichever is later, are entitled to exercise those rights.
8-3 D. A record date fixed under this section may not be more
8-4 than sixty (60) days before the date of the meeting or action that
8-5 requires the determination of the members.
8-6 E. A determination of members entitled to notice of or to
8-7 vote at a members' meeting is effective for any adjournment of the
8-8 meeting unless the board fixes a new date for determining the right
8-9 to notice or the right to vote. The board must fix a new date for
8-10 determining the right to notice or the right to vote if the meeting
8-11 is adjourned to a date more than ninety (90) days after the record
8-12 date for determining members entitled to notice of the original
8-13 meeting.
8-14 Art. 2.11B. MEMBERS' LIST FOR MEETING. A. After fixing a
8-15 record date for the notice of a meeting, a corporation shall
8-16 prepare an alphabetical list of the names of all its members who
8-17 are entitled to notice of the meeting. The list must show the
8-18 address and number of votes each member is entitled to cast at the
8-19 meeting. The corporation shall maintain, through the time of the
8-20 members' meeting, a list of members who are entitled to vote at the
8-21 meeting but are not entitled to notice of the meeting. This list
8-22 shall be prepared on the same basis and be part of the list of
8-23 members.
8-24 B. Not later than two (2) business days after the date
8-25 notice is given of a meeting for which a list was prepared, as
8-26 provided by Section A of this article, and continuing through the
8-27 meeting, the list of members must be available for inspection by
9-1 any member for the purpose of communication with other members
9-2 concerning the meeting at the corporation's principal office or at
9-3 a reasonable place identified in the meeting notice in the city
9-4 where the meeting will be held. A member or member's agent or
9-5 attorney is entitled on written demand to inspect and, subject to
9-6 the limitations of Section B, Article 2.23, of this Act to copy the
9-7 list at a reasonable time and at the member's expense during the
9-8 period it is available for inspection.
9-9 C. The corporation shall make the list of members available
9-10 at the meeting, and any member or member's agent or attorney is
9-11 entitled to inspect the list at any time during the meeting or any
9-12 adjournment.
9-13 SECTION 8. Sections A and B, Article 2.13, Texas Non-Profit
9-14 Corporation Act (Article 1396-2.13, Vernon's Texas Civil Statutes),
9-15 are amended to read as follows:
9-16 A. Each member, regardless of class, shall be entitled to
9-17 one (1) vote on each matter submitted to a vote <at a meeting> of
9-18 the members, except to the extent that the voting rights of members
9-19 of any class or classes are limited, enlarged, or denied by the
9-20 articles of incorporation or the by-laws.
9-21 B. A member may vote in person or, unless the articles of
9-22 incorporation or the by-laws otherwise provide, may vote by proxy
9-23 executed in writing by the member or by his duly authorized
9-24 attorney-in-fact. No proxy shall be valid after eleven (11) months
9-25 from the date of its execution, unless otherwise provided in the
9-26 proxy<; provided, however, proxies executed before and in existence
9-27 on the effective date of this Act shall continue in and have such
10-1 effect as they then have in accordance with whatever may then be
10-2 their terms>. Each proxy shall be revocable unless expressly
10-3 provided therein to be irrevocable, and in no event shall it remain
10-4 irrevocable for more than eleven (11) months. Where directors or
10-5 officers are to be elected by members, the by-laws may provide that
10-6 such elections may be conducted by mail, by facsimile transmission,
10-7 or by any combination of the two.
10-8 SECTION 9. Article 2.14, Texas Non-Profit Corporation Act
10-9 (Article 1396-2.14, Vernon's Texas Civil Statutes), is amended to
10-10 read as follows:
10-11 Art. 2.14. BOARD OF DIRECTORS <OR TRUSTEES>. A. The
10-12 affairs of a corporation shall be managed by a board of directors<,
10-13 or trustees>. Directors <or trustees> need not be residents of
10-14 this State or members of the corporation unless the articles of
10-15 incorporation or the by-laws so require. The articles of
10-16 incorporation or the by-laws may prescribe other qualifications for
10-17 directors <or trustees>.
10-18 B. Boards of directors <or trustees> of religious,
10-19 charitable, educational, or eleemosynary institutions may be
10-20 affiliated with, elected and controlled by a convention, conference
10-21 or association organized under the laws of this State or another
10-22 state, whether incorporated or unincorporated, whose membership is
10-23 composed of representatives, delegates, or messengers from any
10-24 church or other religious association.
10-25 C. The articles of incorporation of a corporation <church>
10-26 may vest the management of the affairs of the corporation in its
10-27 members. If the corporation <church> has a board of directors <or
11-1 similar body>, it may limit the authority of the <such> board of
11-2 directors to whatever extent as may be set forth in the articles of
11-3 incorporation or by-laws. A corporation <church organized and
11-4 operating under a congregational system and incorporated prior to
11-5 the effective date of this Act> shall be deemed to have vested the
11-6 management of the affairs of the corporation in its board of
11-7 directors <members> in the absence of an express provision to the
11-8 contrary in the articles of incorporation or the by-laws.
11-9 D. The board of directors <In the case of a corporation
11-10 which is a church, the Board> may be designated by any name
11-11 appropriate to the customs, usages, or tenets of the corporation
11-12 <church>.
11-13 E. The board of directors <or trustees> of a <non-profit>
11-14 corporation may be elected (in whole or in part) by one or more
11-15 associations <another non-profit corporation> or corporations,
11-16 organized under the laws of this State or another state <domestic
11-17 or foreign,> if (1) the articles of incorporation or the by-laws
11-18 <bylaws> of the former corporation so provide, and (2) the former
11-19 corporation has no members with voting rights.
11-20 F. The articles of incorporation or the by-laws may provide
11-21 that any one or more persons may be ex-officio members of the board
11-22 of directors. A person designated as an ex-officio member of the
11-23 board of directors is entitled to notice of and to attend meetings
11-24 of the board of directors. The ex-officio member is not entitled
11-25 to vote unless otherwise provided in the articles of incorporation
11-26 or the by-laws. An ex-officio member of the board of directors who
11-27 is not entitled to vote does not have the duties or liabilities of
12-1 a director as provided in this Act.
12-2 SECTION 10. Article 2.15, Texas Non-Profit Corporation Act
12-3 (Article 1396-2.15, Vernon's Texas Civil Statutes), is amended to
12-4 read as follows:
12-5 Art. 2.15. Number, Election, Classification, and Removal of
12-6 Directors. A. The number of directors of a corporation shall be
12-7 not less than three (3). Subject to such limitation, the number of
12-8 directors shall be fixed by, or in the manner provided in, the
12-9 articles of incorporation or the by-laws, except as to the number
12-10 constituting the initial board of directors, which number shall be
12-11 fixed by the articles of incorporation. The number of directors
12-12 may be increased or decreased from time to time by amendment to, or
12-13 in the manner provided in, the articles of incorporation or the
12-14 by-laws, but no decrease shall have the effect of shortening the
12-15 term of any incumbent director. The number of directors may not be
12-16 decreased to fewer than three (3). In the absence of a by-law or a
12-17 provision of the articles of incorporation fixing the number of
12-18 directors or providing for the manner in which the number of
12-19 directors shall be fixed, the number of directors shall be the same
12-20 as the number constituting the initial board of directors as fixed
12-21 by the articles of incorporation.
12-22 B. The directors constituting the initial board of directors
12-23 shall be named in the articles of incorporation and shall hold
12-24 office until the first annual election of directors or for such
12-25 other period as may be specified in the articles of incorporation
12-26 or the by-laws. Thereafter, directors shall be elected, <or>
12-27 appointed, or designated in the manner and for the terms provided
13-1 in the articles of incorporation or the by-laws. If the method of
13-2 election, designation, or appointment is not provided in the
13-3 articles of incorporation or by-laws, the directors, other than the
13-4 initial directors, shall be elected by the board of directors. In
13-5 the absence of a provision in the articles of incorporation or the
13-6 by-laws fixing the term of office, a director shall hold office
13-7 until the next annual election of directors and until his successor
13-8 shall have been elected, <or> appointed, or designated and
13-9 qualified.
13-10 C. Directors may be divided into classes and the terms of
13-11 office of the several classes need not be uniform. Unless removed
13-12 in accordance with the provisions of the articles of incorporation
13-13 or the by-laws, each director shall hold office for the term for
13-14 which he is elected, <or> appointed, or designated and until his
13-15 successor shall have been elected, <or> appointed, or designated
13-16 and qualified.
13-17 D. A director may be removed from office pursuant to any
13-18 procedure therefor provided in the articles of incorporation or
13-19 by-laws. In the absence of a provision providing for removal, a
13-20 director may be removed from office, with or without cause, by the
13-21 persons entitled to elect, designate, or appoint the director. If
13-22 the director was elected to office, removal requires an affirmative
13-23 vote equal to the vote necessary to elect the director.
13-24 SECTION 11. Article 2.20, Texas Non-Profit Corporation Act
13-25 (Article 1396-2.20, Vernon's Texas Civil Statutes), is amended to
13-26 read as follows:
13-27 Art. 2.20. Officers. A. The officers of a corporation
14-1 shall consist of a president and a secretary and may also consist
14-2 of a vice-president, <one or more vice-presidents, a secretary,> a
14-3 treasurer, and such other officers and assistant officers as may be
14-4 deemed necessary, each of whom shall be elected or appointed at
14-5 such time and in such manner and for such terms not exceeding three
14-6 (3) years as may be prescribed in the articles of incorporation or
14-7 the by-laws. In the absence of any such provisions, all officers
14-8 shall be elected or appointed annually by the board of directors,
14-9 or, if the management of the corporation is vested in its members
14-10 <pursuant to Article 2.14C of this Act>, by the members. Any two
14-11 or more offices may be held by the same person, except the offices
14-12 of president and secretary. A committee duly designated may
14-13 perform the functions of any officer and the functions of any two
14-14 or more officers may be performed by a single committee, including
14-15 the functions of both president and secretary.
14-16 B. <The articles of incorporation or the by-laws may provide
14-17 that any one or more officers of the corporation shall be
14-18 ex-officio members of the board of directors.>
14-19 <C.> The officers of a corporation may be designated by such
14-20 other or additional titles as may be provided in the articles of
14-21 incorporation or the by-laws.
14-22 C. <D.> In the case of a corporation which is a church, it
14-23 shall not be necessary that there be officers as provided herein,
14-24 but such duties and responsibilities may be vested in the board of
14-25 directors <trustees> or other designated body in any manner
14-26 provided for in the articles of incorporation or the by-laws.
14-27 D. In the discharge of a duty imposed or power conferred on
15-1 an officer of a corporation, the officer may in good faith rely on
15-2 information, opinions, reports, or statements, including financial
15-3 statements and other financial data, concerning the corporation or
15-4 another person, that were prepared or presented by:
15-5 (1) one or more other officers or employees of the
15-6 corporation, including members of the board of directors;
15-7 (2) legal counsel, public accountants, or other
15-8 persons as to matters the officer reasonably believes are within
15-9 the person's professional or expert competence; or
15-10 (3) in the case of religious corporations, religious
15-11 authorities and ministers, priests, rabbis, or other persons whose
15-12 position or duties in the religious organization the officer
15-13 believes justify reliance and confidence and whom the officer
15-14 believes to be reliable and competent in the matters presented.
15-15 E. An officer is not relying in good faith as required by
15-16 Section D of this article if the officer has knowledge concerning
15-17 the matter in question that makes reliance otherwise permitted by
15-18 Section D of this article unwarranted.
15-19 SECTION 12. Section B, Article 2.23, Texas Non-Profit
15-20 Corporation Act (Article 1396-2.23, Vernon's Texas Civil Statutes),
15-21 is amended to read as follows:
15-22 B. A member of a corporation, on written demand stating the
15-23 purpose of the demand, has the right to examine and copy, in person
15-24 or by agent, accountant, or attorney, at any reasonable time, <All
15-25 books and records of a corporation may be inspected by any member,
15-26 or his agent or attorney,> for any proper purpose, the books and
15-27 records of account of the corporation relevant to that purpose, at
16-1 the expense of the member at any reasonable time.
16-2 SECTION 13. Sections B and C, Article 2.23A, Texas
16-3 Non-Profit Corporation Act (Article 1396-2.23A, Vernon's Texas
16-4 Civil Statutes), are amended to read as follows:
16-5 B. Based on these records, the board of directors <or
16-6 trustees> shall annually prepare or approve a report of the
16-7 financial activity of the corporation for the preceding year. The
16-8 report must conform to accounting standards as promulgated by the
16-9 American Institute of Certified Public Accountants and must include
16-10 a statement of support, revenue, and expenses and changes in fund
16-11 balances, a statement of functional expenses, and balance sheets
16-12 for all funds.
16-13 C. All <records,> books<,> and records of accounts and
16-14 annual reports of the financial activity of the corporation shall
16-15 be kept at the registered office or principal office of the
16-16 corporation in this state for at least three years after the
16-17 closing of each fiscal year and shall be available to the public
16-18 for inspection and copying there during normal business hours. The
16-19 corporation may charge for the reasonable expense of preparing a
16-20 copy of a record or report.
16-21 SECTION 14. Article 2.26, Texas Non-Profit Corporation Act
16-22 (Article 1396-2.26, Vernon's Texas Civil Statutes), is amended to
16-23 read as follows:
16-24 Art. 2.26. LIABILITY OF DIRECTORS IN CERTAIN CASES <AND
16-25 OTHER PERSONS FOR WRONGFUL DISTRIBUTION OF ASSETS>. A. In
16-26 addition to any other liabilities imposed by law upon directors of
16-27 a corporation, the directors who vote for or assent to any
17-1 distribution of assets other than in payment of its debts, when the
17-2 corporation is insolvent or when such distribution would render the
17-3 corporation insolvent, or during the liquidation of the corporation
17-4 without the payment and discharge of or making adequate provisions
17-5 for all known debts, obligations and liabilities of the
17-6 corporation, shall be jointly and severally liable to the
17-7 corporation for the value of such assets which are thus
17-8 distributed, to the extent that such debts, obligations and
17-9 liabilities of the corporation are not thereafter paid and
17-10 discharged.
17-11 B. A director of a corporation who is present at a meeting
17-12 of its board of directors at which action was taken on such
17-13 corporate matter shall be presumed to have assented to such action
17-14 unless his dissent shall be entered in the minutes of the meeting
17-15 or unless he shall file his written dissent to such action with the
17-16 person acting as the secretary of the meeting before the
17-17 adjournment thereof or shall forward such dissent by registered
17-18 mail to the secretary of the corporation immediately after the
17-19 adjournment of the meeting. Such right to dissent shall not apply
17-20 to a director who voted in favor of the action.
17-21 C. A director shall not be liable under Section A of this
17-22 Article if, in voting for or assenting to a distribution, the
17-23 director:
17-24 (1) relied in good faith on information, opinions,
17-25 reports, or statements, including financial statements and other
17-26 financial data, concerning the corporation or another person that
17-27 were prepared or presented by:
18-1 (a) one or more officers or employees of the
18-2 corporation;
18-3 (b) legal counsel, public accountants, or other
18-4 persons as to matters the director reasonably believes are within
18-5 the person's professional or expert competence; or
18-6 (c) a committee of the board of directors of
18-7 which the director is not a member;
18-8 (2) acting in good faith, considered the assets of the
18-9 corporation to be at least that of their book value; or
18-10 (3) in determining whether the corporation made
18-11 adequate provision for payment, satisfaction, or discharge of all
18-12 of its liabilities and obligations as provided in Article 6.03 of
18-13 this Act, relied in good faith on financial statements of, or other
18-14 information concerning, a person who was or became contractually
18-15 obligated to pay, satisfy, or discharge some or all of those
18-16 liabilities or obligations <the exercise of ordinary care, he
18-17 relied and acted in good faith upon written financial statements of
18-18 the corporation represented to him to be correct by the president
18-19 or by the officer of such corporation having charge of its books of
18-20 account, or certified by an independent public or certified public
18-21 accountant or firm of such accountants fairly to reflect the
18-22 financial condition of such corporation, nor shall he be so liable
18-23 if, in the exercise of ordinary care and good faith, in determining
18-24 the amount available for such distribution, he considered the
18-25 assets to be of their book value>.
18-26 D. A director shall not be liable under this Article if, in
18-27 the exercise of ordinary care, he acted in good faith and in
19-1 reliance upon the written opinion of an attorney for the
19-2 corporation.
19-3 E. A director against whom a claim shall be asserted under
19-4 this Article and who shall be held liable thereon shall be entitled
19-5 to contribution from persons who accepted or received such
19-6 distribution knowing such distribution to have been made in
19-7 violation of this Article, in proportion to the amounts received by
19-8 them respectively.
19-9 SECTION 15. Sections A and C, Article 2.27, Texas Non-Profit
19-10 Corporation Act (Article 1396-2.27, Vernon's Texas Civil Statutes),
19-11 are amended to read as follows:
19-12 A. Notwithstanding any provision in this Act or in the
19-13 articles of incorporation to the contrary (except as provided in
19-14 Section B), the articles of incorporation of each corporation which
19-15 is a private foundation described in Section 509 of the Internal
19-16 Revenue Code of 1986 <1954> shall be deemed to contain the
19-17 following provisions: "The corporation shall make distributions at
19-18 such time and in such manner as not to subject it to tax under
19-19 Section 4942 of the Internal Revenue Code of 1986 <1954>; the
19-20 corporation shall not engage in any act of self-dealing which would
19-21 be subject to tax under Section 4941 of the Code; the corporation
19-22 shall not retain any excess business holdings which would subject
19-23 it to tax under Section 4943 of the Code; the corporation shall
19-24 not make any investments which would subject it to tax under
19-25 Section 4944 of the Code; and the corporation shall not make any
19-26 taxable expenditures which would subject it to tax under Section
19-27 4945 of the Code." With respect to any such corporation organized
20-1 prior to January 1, 1970, this Section A shall apply only for its
20-2 taxable years beginning on or after January 1, 1972.
20-3 C. All references in this Article to "the Code" are to the
20-4 Internal Revenue Code of 1986 <1954>, and all references in this
20-5 Article to specific sections of the Code include corresponding
20-6 provisions of any subsequent Federal tax laws.
20-7 SECTION 16. The Texas Non-Profit Corporation Act (Article
20-8 1396-1.01 et seq., Vernon's Texas Civil Statutes) is amended by
20-9 adding Articles 2.28, 2.29, and 2.30 to read as follows:
20-10 Art. 2.28. GENERAL STANDARDS FOR DIRECTORS. A. A director
20-11 shall discharge the director's duties, including the director's
20-12 duties as a member of a committee, in good faith and in a manner
20-13 the director reasonably believes to be in the best interest of the
20-14 corporation.
20-15 B. In the discharge of any duty imposed or power conferred
20-16 on a director, including as a member of a committee, the director
20-17 may in good faith rely on information, opinions, reports, or
20-18 statements, including financial statements and other financial
20-19 data, concerning the corporation or another person that were
20-20 prepared or presented by:
20-21 (1) one or more officers or employees of the
20-22 corporation;
20-23 (2) legal counsel, public accountants, or other
20-24 persons as to matters the director reasonably believes are within
20-25 the person's professional or expert competence;
20-26 (3) a committee of the board of directors of which the
20-27 director is not a member; or
21-1 (4) in the case of religious corporations, religious
21-2 authorities and ministers, priests, rabbis, or other persons whose
21-3 position or duties in the religious organization the director
21-4 believes justify reliance and confidence and whom the director
21-5 believes to be reliable and competent in the matters presented.
21-6 C. A director is not relying in good faith, within the
21-7 meaning of this article, if the director has knowledge concerning a
21-8 matter in question that makes reliance otherwise permitted by this
21-9 article unwarranted.
21-10 D. A director is not liable to the corporation, any member,
21-11 or any other person for any action taken or not taken as a director
21-12 if the director acted in compliance with this article. A person
21-13 seeking to establish liability of a director must prove by clear
21-14 and convincing evidence that the director has not acted in:
21-15 (1) good faith; and
21-16 (2) a manner the director reasonably believes to be in
21-17 the best interest of the corporation.
21-18 E. A director is not deemed to have the duties of a trustee
21-19 of a trust with respect to the corporation or with respect to any
21-20 property held or administered by the corporation, including
21-21 property that may be subject to restrictions imposed by the donor
21-22 or transferor of the property.
21-23 Art. 2.29. DELEGATION OF INVESTMENT AUTHORITY. A. The
21-24 board of directors of a corporation may:
21-25 (1) from time to time engage investment counsel, trust
21-26 corporations, or banks possessing trust powers; and
21-27 (2) confer on those advisors full power and authority
22-1 to:
22-2 (a) purchase or otherwise acquire stocks, bonds,
22-3 securities, and other investments on behalf of the corporation; and
22-4 (b) sell, transfer, or otherwise dispose of any
22-5 of the corporation's assets and properties at a time and for a
22-6 consideration that the advisor deems appropriate.
22-7 B. The board of directors also may:
22-8 (1) confer on an advisor described by Section A of
22-9 this article other powers regarding the corporation's investments
22-10 as the board of directors deems appropriate; and
22-11 (2) authorize the advisor to hold title to any of the
22-12 corporation's assets and properties in its own name for the benefit
22-13 of the corporation or in the name of a nominee for the benefit of
22-14 the corporation.
22-15 C. The board of directors has no liability regarding any
22-16 action taken or omitted by an advisor engaged under this article if
22-17 the board of directors acted in good faith in selecting the
22-18 advisor. The board of directors may remove or replace the advisor,
22-19 with or without cause, if they deem that action appropriate or
22-20 necessary.
22-21 Art. 2.30. INTERESTED DIRECTORS. A. A contract or
22-22 transaction between a corporation and one or more of its directors,
22-23 officers, or members, or between a corporation and any other
22-24 corporation, partnership, association, or other organization in
22-25 which one or more of its directors, officers, or members are
22-26 directors, officers, or members, or have a financial interest, is
22-27 not void or voidable solely for that reason, solely because the
23-1 director, officer, or member is present at or participates in the
23-2 meeting of the board or committee of the board or of the members
23-3 that authorizes the contract or transaction, or solely because the
23-4 director's, officer's, or member's votes are counted for that
23-5 purpose, if:
23-6 (1) the material facts as to the relationship or
23-7 interest and as to the contract or transaction are disclosed or are
23-8 known to the board of directors, the committee, or the members, and
23-9 the board, committee, or members in good faith authorizes the
23-10 contract or transaction by the affirmative vote of a majority of
23-11 the disinterested directors or members, even though the
23-12 disinterested directors or members are less than a quorum;
23-13 (2) the material facts as to the relationship or
23-14 interest and as to the contract or transaction are disclosed or are
23-15 known to the members entitled to vote on the contract or
23-16 transaction, and the contract or transaction is specifically
23-17 approved in good faith by vote of the members; or
23-18 (3) the contract or transaction is fair to the
23-19 corporation when it is authorized, approved, or ratified by the
23-20 board of directors, a committee of the board, or the members.
23-21 B. Common or interested directors or members may be counted
23-22 in determining the presence of a quorum at a meeting of the board
23-23 of directors, of a committee, or of the members that authorizes the
23-24 contract or transaction.
23-25 SECTION 17. Sections A and D, Article 3.02, Texas Non-Profit
23-26 Corporation Act (Article 1396-3.02, Vernon's Texas Civil Statutes),
23-27 are amended to read as follows:
24-1 A. The articles of incorporation shall set forth:
24-2 (1) The name of the corporation.
24-3 (2) A statement that the corporation is a non-profit
24-4 corporation.
24-5 (3) The period of duration, which may be perpetual.
24-6 (4) The purpose or purposes for which the corporation
24-7 is organized.
24-8 (5) If the corporation is to have no members, a
24-9 statement to that effect.
24-10 (6) If <the corporation is a church and the>
24-11 management of the <its> affairs of the corporation is to be vested
24-12 in its members <pursuant to Article 2.14C of this Act>, a statement
24-13 to that effect.
24-14 (7) Any provision, not inconsistent with law,
24-15 including any provision which under this Act is required or
24-16 permitted to be set forth in the bylaws, which the incorporators
24-17 elect to set forth in the articles of incorporation for the
24-18 regulation of the internal affairs of the corporation.
24-19 (8) The street address of its initial registered
24-20 office and the name of its initial registered agent at such street
24-21 address.
24-22 (9) The number of directors <or trustees> constituting
24-23 the initial board of directors <or trustees>, and the names and
24-24 addresses of the persons who are to serve as the initial directors
24-25 unless the management of the corporation is vested in its members,
24-26 in which event a statement to that effect <or trustees. A church
24-27 vesting management of its affairs in its members pursuant to
25-1 Article 2.14C of this Act may, in lieu of providing for a board of
25-2 directors or trustees, set forth in the articles of incorporation
25-3 the officers or other body designated pursuant to Article 2.20D of
25-4 this Act>.
25-5 (10) The name and street or post office address of
25-6 each incorporator.
25-7 (11) Provisions consistent with Article 6.02 of this
25-8 Act regarding the distribution of assets on dissolution.
25-9 D. Unless the articles of incorporation provide that a
25-10 change in the number of directors <or trustees> shall be made only
25-11 by amendment to the articles of incorporation, a change in the
25-12 number of directors <or trustees> made by amendment to the by-laws
25-13 shall be controlling. In all other cases, whenever a provision of
25-14 the articles of incorporation is inconsistent with a by-law, the
25-15 provision of the articles of incorporation shall be controlling.
25-16 SECTION 18. Sections A and C, Article 3.05, Texas Non-Profit
25-17 Corporation Act (Article 1396-3.05, Vernon's Texas Civil Statutes),
25-18 are amended to read as follows:
25-19 A. After the issuance of the certificate of incorporation,
25-20 an organization meeting of the board of directors named in the
25-21 articles of incorporation shall be held, either within or without
25-22 this State, at the call of <a majority of> the incorporators or the
25-23 call of a majority of the directors named in the articles of
25-24 incorporation, for the purpose of adopting by-laws, electing
25-25 officers, and for such other purposes as may come before the
25-26 meeting. The incorporators or directors calling the meeting shall
25-27 give at least three (3) days' notice thereof by mail to each
26-1 director named in the articles of incorporation, which notice shall
26-2 state the time and place of the meeting.
26-3 C. If the management of a corporation <church> is vested in
26-4 its members <pursuant to Article 2.14C of this Act>, the
26-5 organization meeting shall be held by the members upon the call of
26-6 any <a majority> of the incorporators. The incorporators calling
26-7 the meeting shall (a) give at least three (3) days' notice by mail
26-8 to each member stating the time and place of the meeting, or shall
26-9 (b) make an oral announcement of the time and place of meeting at
26-10 a regularly scheduled worship service prior to such meeting if the
26-11 corporation is a church, or shall (c) give such notice of the
26-12 meeting as may be provided for in the articles of incorporation.
26-13 SECTION 19. Article 4.02, Texas Non-Profit Corporation Act
26-14 (Article 1396-4.02, Vernon's Texas Civil Statutes), is amended by
26-15 amending Section A and adding Section C to read as follows:
26-16 A. Amendments to the articles of incorporation may be made
26-17 in the following manner:
26-18 (1) Except as provided in Section A(4) of this
26-19 article, where <Where> there are members having voting rights, the
26-20 board of directors shall adopt a resolution setting forth the
26-21 proposed amendment and directing that it be submitted to a vote at
26-22 a meeting of members having voting rights, which may be either an
26-23 annual or a special meeting. Written or printed notice setting
26-24 forth the proposed amendment or a summary of the changes to be
26-25 effected thereby shall be given to each member entitled to vote at
26-26 such meeting within the time and in the manner provided in this Act
26-27 for the giving of notice of meetings of members. The proposed
27-1 amendment shall be adopted upon receiving at least two-thirds of
27-2 the votes which members present at such meeting in person or by
27-3 proxy are entitled to cast, unless any class of members is entitled
27-4 to vote as a class thereon by the terms of the articles of
27-5 incorporation or of the by-laws, in which event the proposed
27-6 amendment shall not be adopted unless it also receives at least
27-7 two-thirds of the votes which the members of each such class who
27-8 are present at such meeting in person or by proxy are entitled to
27-9 cast.
27-10 (2) Where there are no members, <or> no members having
27-11 voting rights, or in the case of an amendment under Section A(4) of
27-12 this article, an amendment shall be adopted at a meeting of the
27-13 board of directors upon receiving the vote of a majority of the
27-14 directors in office.
27-15 (3) Where the management of the affairs of the
27-16 corporation is vested in the members pursuant to Article 2.14C of
27-17 this Act, the proposed amendment shall be submitted to a vote at a
27-18 meeting of members which may be an annual, a regular, or a special
27-19 meeting. Except as otherwise provided in the articles of
27-20 incorporation or the by-laws, notice setting forth the proposed
27-21 amendment or a summary of the changes to be effected thereby shall
27-22 be given to the members within the time and in the manner provided
27-23 in this Act for the giving of notice of meetings of members. The
27-24 proposed amendment shall be adopted upon receiving at least
27-25 two-thirds of the votes of members present at such meeting.
27-26 (4) Unless the articles of incorporation provide
27-27 otherwise, the board of directors of a corporation with members
28-1 having voting rights may adopt one or more of the following
28-2 amendments to the articles of incorporation without member
28-3 approval:
28-4 (a) extend the duration of the corporation if it
28-5 was incorporated when limited duration was required by law;
28-6 (b) delete the names and addresses of the
28-7 initial directors;
28-8 (c) delete the name and address of the initial
28-9 registered agent or registered office, if a statement of change is
28-10 on file with the Secretary of State; or
28-11 (d) change the corporate name by substituting
28-12 the word "corporation," "incorporated," "company," "limited," or
28-13 the abbreviation "corp.," "inc.," "co.," "ltd.," for a similar word
28-14 or abbreviation in the name, or by adding, deleting, or changing a
28-15 geographical attribution to the name.
28-16 C. If a corporation has no members, or no members with
28-17 voting rights, its articles of incorporation may contain a
28-18 provision that vests the power to approve any amendments to the
28-19 articles of incorporation in the board of directors or members of
28-20 another association or corporation organized under the laws of this
28-21 State or of another state. If that provision is contained in a
28-22 corporation's articles of incorporation, amendments to that
28-23 corporation's articles of incorporation are not effective until
28-24 they are approved by the board of directors or members, whichever
28-25 is designated in the corporation's articles of incorporation, of
28-26 the other corporation.
28-27 SECTION 20. Section A, Article 4.06, Texas Non-Profit
29-1 Corporation Act (Article 1396-4.06, Vernon's Texas Civil Statutes),
29-2 is amended to read as follows:
29-3 A. A corporation may, by following the procedure to amend
29-4 the articles of incorporation provided by this Act, authorize,
29-5 execute and file restated articles of incorporation, except that
29-6 member approval, if the corporation has members with voting rights,
29-7 is not required if no amendments are made. The restated articles
29-8 of incorporation <which> may restate either:
29-9 (1) The entire text of the articles of incorporation
29-10 as amended or supplemented by all certificates of amendment
29-11 previously issued by the Secretary of State; or
29-12 (2) The entire text of the articles of incorporation
29-13 as amended or supplemented by all certificates of amendment
29-14 previously issued by the Secretary of State, and as further amended
29-15 by such restated articles of incorporation.
29-16 SECTION 21. Article 5.05, Texas Non-Profit Corporation Act
29-17 (Article 1396-5.05, Vernon's Texas Civil Statutes), is amended to
29-18 read as follows:
29-19 Art. 5.05. Effective Date of Merger or Consolidation of
29-20 Domestic Corporations. A. Except as provided by Article 10.07 of
29-21 this Act, on <Upon> the issuance of the certificate of merger or
29-22 the certificate of consolidation by the Secretary of State, the
29-23 merger or consolidation of domestic corporations shall be effected.
29-24 SECTION 22. Article 5.08, Texas Non-Profit Corporation Act
29-25 (Article 1396-5.08, Vernon's Texas Civil Statutes), is amended to
29-26 read as follows:
29-27 Art. 5.08. Conveyance by Corporation. A. Any corporation
30-1 may convey land by deed, with or without the seal of the
30-2 corporation, signed by an officer <the president or vice-president>
30-3 or attorney in fact of the corporation when authorized by
30-4 appropriate resolution of the board of directors or members. Such
30-5 deed, when acknowledged by such officer or attorney in fact to be
30-6 the act of the corporation, or proved in the manner prescribed for
30-7 other conveyances of lands, may be recorded in like manner and with
30-8 the same effect as other deeds. Any such deed when recorded, if
30-9 signed by an officer <the president or any vice-president> of the
30-10 corporation, shall constitute prima facie evidence that such
30-11 resolution of the board of directors or members was duly adopted.
30-12 SECTION 23. Article 6.02, Texas Non-Profit Corporation Act
30-13 (Article 1396-6.02, Vernon's Texas Civil Statutes), is amended to
30-14 read as follows:
30-15 Art. 6.02. Application and Distribution of Assets. A. The
30-16 assets of a corporation in the process of dissolution shall be
30-17 applied and distributed as follows:
30-18 (1) All liabilities and obligations of the corporation
30-19 shall be paid, satisfied and discharged; in case its property and
30-20 assets are not sufficient to satisfy or discharge all the
30-21 corporation's liabilities and obligations, the corporation shall
30-22 apply them so far as they will go to the just and equitable payment
30-23 of the liabilities and obligations.
30-24 (2) Assets held by the corporation upon condition
30-25 requiring return, transfer or conveyance, which condition occurs by
30-26 reason of the dissolution, shall be returned, transferred or
30-27 conveyed in accordance with such requirements.
31-1 (3) Unless provided otherwise by a provision of the
31-2 corporation's articles of incorporation <that refers to this
31-3 subsection>, the remaining assets of the corporation shall be
31-4 distributed only for tax exempt purposes to one or more
31-5 organizations which are exempt under Section 501(c)(3), Internal
31-6 Revenue Code of 1986 <1954> (26 U.S.C. Section 501(c)(3)), or its
31-7 successor statute, or which are described in Section 170(c)(1) or
31-8 (2), Internal Revenue Code of 1986 <1954> (26 U.S.C. Section
31-9 170(c)(1) or (2)), or its successor statute, pursuant to a plan of
31-10 distribution adopted as provided in this Act. A district court of
31-11 the county in which the corporation's principal office is located
31-12 shall distribute to one or more organizations exempt under Section
31-13 501(c)(3) or described in Section 170(c)(1) or (2), or their
31-14 successor statutes, the remaining assets of the corporation not
31-15 distributed under the plan of distribution. Any distribution by
31-16 the court shall be made in such manner as, in the judgment of the
31-17 court, will best accomplish the general purposes for which the
31-18 corporation was organized.
31-19 SECTION 24. Article 7.09, Texas Non-Profit Corporation Act
31-20 (Article 1396-7.09, Vernon's Texas Civil Statutes), is amended to
31-21 read as follows:
31-22 Art. 7.09. Decree of Involuntary Dissolution. A. In
31-23 proceedings to liquidate the assets and affairs of a corporation,
31-24 when the costs and expenses of such proceedings and all debts,
31-25 obligations, and liabilities of the corporation shall have been
31-26 paid and discharged, or adequate provision has been made for the
31-27 discharge, and all of its remaining property and assets distributed
32-1 in accordance with the provisions of this Act, or in case its
32-2 property and assets are not sufficient to satisfy and discharge
32-3 such costs, expenses, debts, and obligations, when all the property
32-4 and assets have been applied so far as they will go to their
32-5 payment, the court shall enter a decree dissolving the corporation,
32-6 whereupon the <existence of the> corporation shall cease to exist.
32-7 SECTION 25. Section B, Article 7.11, Texas Non-Profit
32-8 Corporation Act (Article 1396-7.11, Vernon's Texas Civil Statutes),
32-9 is amended to read as follows:
32-10 B. On receipt of satisfactory written <and verified> proof
32-11 of ownership or of right to such fund within seven (7) years from
32-12 the date such fund was so deposited, the State Treasurer shall
32-13 certify such fact to the Comptroller of Public Accounts, who shall
32-14 issue proper warrant therefor drawn on the State Treasurer in favor
32-15 of the person or persons then entitled thereto. If no claimant has
32-16 made satisfactory proof of rights to such fund within seven (7)
32-17 years from the time of such deposit the State Treasurer shall then
32-18 cause to be published in one issue of a newspaper of general
32-19 circulation in Travis County, Texas, a notice of the proposed
32-20 escheat of such fund, giving the name of the creditor, member, or
32-21 other person <or shareholder> apparently entitled thereto, his last
32-22 known address, if any, the amount of the fund so deposited, and the
32-23 name of the dissolved corporation from whose assets such fund was
32-24 derived. If no claimant makes satisfactory proof of right to such
32-25 fund within two months from the time of such publication, the fund
32-26 so unclaimed shall thereupon automatically escheat to and become
32-27 the property of the General Revenue Fund of the State of Texas.
33-1 SECTION 26. Article 7.12, Texas Non-Profit Corporation Act
33-2 (Article 1396-7.12, Vernon's Texas Civil Statutes), is amended to
33-3 read as follows:
33-4 Art. 7.12. Limited Survival After Dissolution. A. A
33-5 dissolved corporation <dissolved (1) by the issuance of a
33-6 certificate of dissolution or other action by the Secretary of
33-7 State, (2) by a decree of a court when the court has not
33-8 liquidated all the assets and business of the corporation as
33-9 provided in this Act, or (3) by expiration of its period of
33-10 duration,> shall continue its corporate existence for a period of
33-11 three (3) years from the date of dissolution, for the following
33-12 purposes:
33-13 (1) prosecuting or defending in its corporate name any
33-14 action or proceeding by or against the corporation;
33-15 (2) permitting the survival of any remedy not
33-16 otherwise barred by limitations available to or against the
33-17 corporation, its officers, directors, members, or creditors, for
33-18 any right or claim existing, or any liability incurred, before the
33-19 dissolution;
33-20 (3) holding title to and liquidating any assets or
33-21 property that remain in the corporation at the time of, or are
33-22 collected by the corporation after, its dissolution, and applying
33-23 or distributing those assets or properties, or the proceeds
33-24 thereof, as provided in Subsection (3) of Section A of Article 6.04
33-25 of this Act; and
33-26 (4) settling any other affairs not completed before
33-27 its dissolution.
34-1 However, such a dissolved corporation may not continue its
34-2 corporate existence for the purpose of continuing the business or
34-3 affairs for which the dissolved corporation was organized, except
34-4 in the case of a corporation whose period of duration has expired
34-5 and that has chosen to revive its existence as provided in this Act
34-6 or a corporation that has been dissolved by the Secretary of State
34-7 pursuant to Section B of Article 7.01 of this Act and that has been
34-8 reinstated pursuant to Section E of Article 7.01 of this Act.
34-9 B. During the three-year period, the members of the board of
34-10 directors of a dissolved corporation <or trustees> serving at the
34-11 time of dissolution or the majority of them then living, however
34-12 reduced in number, or their successors selected by them, shall
34-13 continue to manage the affairs of the dissolved corporation for the
34-14 limited purpose or purposes specified in this Article, and shall
34-15 have the powers necessary to accomplish those purposes, including
34-16 the power to prosecute, pay, compromise, defend, and satisfy any
34-17 action, claim, demand, or judgment by or against the dissolved
34-18 corporation, and to administer, sell, and distribute in final
34-19 liquidation any property or assets still remaining. In the
34-20 exercise of those powers, the directors shall have the same duties
34-21 to the dissolved corporation that they had immediately prior to the
34-22 dissolution of the corporation and shall be liable to the dissolved
34-23 corporation for actions taken by them after the dissolution to the
34-24 same extent that they would have been liable had those actions been
34-25 taken by them prior to the dissolution. Additional directors or
34-26 trustees may be elected for purposes of this section in accordance
34-27 with the procedures provided in the bylaws in effect before the
35-1 dissolution.
35-2 C. A corporation is not liable for any claim other than an
35-3 existing claim. An existing claim by or against a dissolved
35-4 corporation is extinguished unless an action or proceeding on the
35-5 existing claim is brought before the third anniversary of the date
35-6 of dissolution. If an action or proceeding on an existing claim by
35-7 or against a dissolved corporation is brought within the period
35-8 provided by this section and the existing claim is not extinguished
35-9 under Section D of this article, the dissolved corporation
35-10 continues to survive:
35-11 (1) for purposes of that action or proceeding until
35-12 all judgments, orders, and decrees in that action or proceeding
35-13 have been fully executed; and
35-14 (2) for purposes of applying or distributing any
35-15 properties or assets of the dissolved corporation as provided in
35-16 Article 6.02 of this Act, until the properties or assets are
35-17 applied or distributed <If after the expiration of the three-year
35-18 period there still remains unresolved any action or proceeding not
35-19 otherwise barred by limitations begun by or against the corporation
35-20 before its dissolution or within three (3) years after the date of
35-21 its dissolution, the corporation shall continue to survive only for
35-22 the purpose of that action or proceeding, until any judgment,
35-23 order, or decree in the action or proceeding is fully executed. If
35-24 at the expiration of the three-year period no action or proceeding
35-25 on any remedy available to or against the corporation, its
35-26 officers, directors, members, or creditors, for any right or claim
35-27 existing, or any liability incurred, before the dissolution shall
36-1 have been brought, then that remedy shall abate>.
36-2 D. A dissolved corporation may give written notice to a
36-3 person having or asserting an existing claim against the dissolved
36-4 corporation to present the existing claim to the dissolved
36-5 corporation in accordance with the notice. The notice must be sent
36-6 by registered or certified mail, return receipt requested, to the
36-7 person having or asserting the existing claim at the person's last
36-8 known address, and must:
36-9 (1) state that the person's claim against the
36-10 dissolved corporation must be presented in writing to the dissolved
36-11 corporation on or before the date stated in the notice, which shall
36-12 be not earlier than 120 days after the date the notice is sent to
36-13 the person;
36-14 (2) state that the written presentation of the claim
36-15 must describe the claim in sufficient detail to reasonably inform
36-16 the dissolved corporation of the identity of the person and to the
36-17 nature and amount of the claim;
36-18 (3) state a mailing address where the written
36-19 presentation of the person's claim against the dissolved
36-20 corporation is to be sent and state that if the written
36-21 presentation of the claim is not received at that address on or
36-22 before the date stated in the notice, the claim will be
36-23 extinguished; and
36-24 (4) be accompanied by a copy of this section.
36-25 E. If a written presentation of a person's claim against the
36-26 dissolved corporation that meets the requirements of Section D of
36-27 this article has been received at the address of the dissolved
37-1 corporation stated in the notice on or before the date stated in
37-2 the notice, the dissolved corporation may give written notice to
37-3 that person that the claim is rejected by the dissolved
37-4 corporation. The notice of rejection must be sent by registered or
37-5 certified mail, return receipt requested, addressed to the person
37-6 at the person's last known address, and must state:
37-7 (1) that the claim is rejected by the dissolved
37-8 corporation;
37-9 (2) that the claim will be extinguished unless an
37-10 action or proceeding on the claim is brought within 180 days after
37-11 the date the notice of rejection was sent to the person and before
37-12 the third anniversary of the date of dissolution; and
37-13 (3) the date the notice of rejection was sent and the
37-14 date of dissolution.
37-15 F. A person's claim against a dissolved corporation is
37-16 extinguished if:
37-17 (1) a written presentation of that claim meeting the
37-18 requirements of this article is not received at the address of the
37-19 dissolved corporation stated in the notice to the person on or
37-20 before the date stated in the notice; or
37-21 (2) an action or proceeding on the claim is not
37-22 brought within 180 days after the date a notice of rejection was
37-23 sent to the person and before the third anniversary of the date of
37-24 dissolution.
37-25 G. A dissolved corporation that was dissolved by the
37-26 expiration of the period of its duration may, during the three-year
37-27 period following the date of dissolution, amend its articles of
38-1 incorporation by following the procedure prescribed in this Act to
38-2 extend or perpetuate its period of existence. That expiration
38-3 shall not of itself create any vested right on the part of any
38-4 member or creditor to prevent such an action. No act or contract
38-5 of a dissolved corporation during a period within which it could
38-6 have extended its existence as permitted by this Article, whether
38-7 or not it has taken action so to extend its existence, shall be in
38-8 any degree invalidated by the expiration of its period of duration.
38-9 H. In this article:
38-10 (1) "Dissolved corporation" means a corporation that
38-11 was dissolved:
38-12 (a) by the issuance of a certificate of
38-13 dissolution or other action by the Secretary of State;
38-14 (b) by a decree of a court when the court has
38-15 not liquidated all the assets and affairs of the corporation as
38-16 provided in this Act; or
38-17 (c) by expiration of its period of duration if
38-18 the corporation has not revived its existence as provided in this
38-19 Act.
38-20 (2) "Claim" means a right to payment, damages, or
38-21 property, whether liquidated or unliquidated, accrued or
38-22 contingent, matured or unmatured.
38-23 (3) "Existing claim" means a claim that existed before
38-24 dissolution and is not otherwise barred by limitations or a
38-25 contractual obligation incurred after dissolution.
38-26 SECTION 27. Section B, Article 8.01, Texas Non-Profit
38-27 Corporation Act (Article 1396-8.01, Vernon's Texas Civil Statutes),
39-1 is amended to read as follows:
39-2 B. Without excluding other activities which may not
39-3 constitute conducting affairs in this State, a foreign corporation
39-4 shall not be considered to be conducting affairs in this State, for
39-5 the purposes of this Act, by reason of carrying on in this State
39-6 any one (1) or more of the following activities:
39-7 (1) Maintaining or defending any action or suit or any
39-8 administration or arbitration proceedings, or affecting the
39-9 settlement thereof or the settlement of claims or disputes to which
39-10 it is a party.
39-11 (2) Holding meetings of its directors or members or
39-12 carrying on other activities concerning its internal affairs.
39-13 (3) Maintaining bank accounts.
39-14 (4) Maintaining offices or agencies for the transfer,
39-15 exchange, and registration of securities issued by it, or
39-16 appointing and maintaining trustees or depositaries with relation
39-17 to its securities.
39-18 (5) Voting the stock of any corporation which it has
39-19 lawfully acquired.
39-20 (6) <(5)> Effecting sales through independent
39-21 contractors.
39-22 (7) Creating as borrower or lender, or acquiring,
39-23 indebtedness or mortgages or other security interests in real or
39-24 personal property <(6) Creating evidence of debt, mortgages, or
39-25 liens on real or personal property>.
39-26 (8) <(7)> Securing or collecting debts due to it or
39-27 enforcing any rights in property securing the same.
40-1 (9) <(8)> Conducting any affairs in interstate
40-2 commerce.
40-3 (10) <(9)> Conducting an isolated transaction
40-4 completed within a period of thirty (30) days and not in the course
40-5 of a number of repeated transactions of like nature.
40-6 (11) <(10)> Exercising the powers of executor or
40-7 administrator of the estate of a non-resident decedent under
40-8 ancillary letters issued by a court of this State, or exercising
40-9 the powers of a trustee under the will of a non-resident decedent,
40-10 or under a trust created by a person, corporation or association,
40-11 non-resident of this State, if the exercise of such powers in such
40-12 case will not involve activities which would be deemed to
40-13 constitute the transacting of business in this State in the case of
40-14 a foreign corporation acting in its own right.
40-15 (12) <(11)> Acquiring, in transactions outside Texas,
40-16 or in interstate commerce, of debts secured by mortgages or liens
40-17 on real or personal property in Texas, collecting or adjusting of
40-18 principal and interest payments thereon, enforcing or adjusting any
40-19 rights and property securing said debts, taking any actions
40-20 necessary to preserve and protect the interest of the mortgagee in
40-21 said security, or any combinations of such transactions.
40-22 (13) <(12)> Investing in or acquiring, in transactions
40-23 outside of Texas, royalties and other non-operating mineral
40-24 interests, and the execution of division orders, contracts of sale
40-25 and other instruments incidental to the ownership of such
40-26 non-operating mineral interests.
40-27 SECTION 28. Section A, Article 8.04, Texas Non-Profit
41-1 Corporation Act (Article 1396-8.04, Vernon's Texas Civil Statutes),
41-2 is amended to read as follows:
41-3 A. A foreign corporation, in order to procure a certificate
41-4 of authority to conduct affairs in this State, shall make
41-5 application therefor to the Secretary of State, which application
41-6 shall set forth:
41-7 (1) The name of the corporation and the state or
41-8 country under the laws of which it is incorporated and, if the
41-9 corporation is required to qualify under a name other than its
41-10 corporate name, the name under which the corporation is to be
41-11 qualified.
41-12 (2) A statement that the corporation is a non-profit
41-13 corporation.
41-14 (3) The date of incorporation and the period of
41-15 duration of the corporation.
41-16 (4) The street address of the principal office of the
41-17 corporation in the state or country under the laws of which it is
41-18 incorporated.
41-19 (5) The street address of the proposed registered
41-20 office of the corporation in this State, and the name of its
41-21 proposed registered agent in this State at such address.
41-22 (6) The purpose or purposes of the corporation which
41-23 it proposes to pursue in conducting its affairs in this State.
41-24 (7) The names and respective addresses of the
41-25 directors and officers of the corporation.
41-26 (8) A statement of whether or not the corporation has
41-27 members.
42-1 (9) Such additional information as may be necessary or
42-2 appropriate in order to enable the Secretary of State to determine
42-3 whether such corporation is entitled to a certificate of authority
42-4 to conduct affairs in this State.
42-5 SECTION 29. Article 8.06, Texas Non-Profit Corporation Act
42-6 (Article 1396-8.06, Vernon's Texas Civil Statutes), is amended to
42-7 read as follows:
42-8 Art. 8.06. Effect of Certificate of Authority. A. Upon the
42-9 issuance of a certificate of authority by the Secretary of State,
42-10 the corporation shall be authorized to conduct affairs in this
42-11 State for those purposes set forth in its application and the
42-12 certificate shall be conclusive evidence of the right of the
42-13 corporation to conduct affairs in this State for that purpose,
42-14 except as against this State in a proceeding to revoke the
42-15 certificate<, subject, however, to the right of this State to
42-16 revoke such authority as provided in this Act>.
42-17 SECTION 30. Section A, Article 8.08, Texas Non-Profit
42-18 Corporation Act (Article 1396-8.08, Vernon's Texas Civil Statutes),
42-19 is amended to read as follows:
42-20 A. A foreign corporation authorized to conduct affairs in
42-21 this state may change its registered office or change its
42-22 registered agent, or both, upon filing in the office of the
42-23 Secretary of State a statement setting forth:
42-24 (1) The name of the corporation.
42-25 (2) The street <post-office> address of its then
42-26 registered office.
42-27 (3) If the street <post-office> address of its
43-1 registered office is to be changed, the street <post-office>
43-2 address to which the registered office is to be changed.
43-3 (4) The name of its then registered agent.
43-4 (5) If its registered agent is to be changed, the name
43-5 of its successor registered agent.
43-6 (6) That the street <post-office> address of its
43-7 registered office and the post-office address of the business
43-8 office of its registered agent, as changed, will be identical.
43-9 (7) That such change was authorized by its Board of
43-10 Directors or by an officer of the corporation so authorized by the
43-11 Board of Directors, or if the management of the corporation is
43-12 vested in its members pursuant to Article 2.14C of this Act, by the
43-13 members.
43-14 SECTION 31. Article 8.12, Texas Non-Profit Corporation Act
43-15 (Article 1396-8.12, Vernon's Texas Civil Statutes), is amended to
43-16 read as follows:
43-17 Art. 8.12. Amended Certificate of Authority. A. If a
43-18 foreign corporation authorized to conduct affairs in this State
43-19 changes any information reflected on its original or an amended
43-20 application for a certificate of authority, including the change of
43-21 its corporate name or a change in the purposes authorized by its
43-22 existing certificate of authority, the corporation shall file an
43-23 application for amended certificate of authority setting forth the
43-24 change with the Secretary of State <A foreign corporation
43-25 authorized to conduct affairs in this State shall procure an
43-26 amended certificate of authority in the event it changes its
43-27 corporate name, or desires to pursue in this State other or
44-1 additional purposes than those set forth in its prior application
44-2 for a certificate of authority, by making application therefor to
44-3 the Secretary of State>.
44-4 B. <Any other statement on the original application for a
44-5 certificate of authority may be changed by filing an application
44-6 for an amended certificate of authority setting forth the change.>
44-7 <C.> An application for an amended certificate of authority
44-8 submitted because of a name change must be accompanied by a
44-9 certificate from the proper filing officer in the jurisdiction of
44-10 incorporation evidencing the name change.
44-11 C. <D.> The requirements in respect to the form and contents
44-12 of such application, the manner of its execution, the filing of the
44-13 original and a copy of the application with the Secretary of State,
44-14 the issuance of an amended certificate of authority and the effect
44-15 thereof, shall be the same as in the case of an original
44-16 application for a certificate of authority.
44-17 SECTION 32. Section A, Article 8.13, Texas Non-Profit
44-18 Corporation Act (Article 1396-8.13, Vernon's Texas Civil Statutes),
44-19 is amended to read as follows:
44-20 A. A foreign corporation authorized to conduct affairs in
44-21 this State may withdraw from this State upon procuring from the
44-22 Secretary of State a certificate of withdrawal. In order to
44-23 procure such certificate of withdrawal, such foreign corporation
44-24 shall deliver to the Secretary of State an application for
44-25 withdrawal, which shall set forth:
44-26 (1) The name of the corporation and the state or
44-27 country under the laws of which it is incorporated.
45-1 (2) That the corporation is not conducting affairs in
45-2 this State.
45-3 (3) That the corporation surrenders its authority to
45-4 conduct affairs in this State.
45-5 (4) That the corporation revokes the authority of its
45-6 registered agent in this State to accept service of process and
45-7 consents that service of process in any action, suit or proceeding
45-8 based upon any cause of action arising in this State during the
45-9 time the corporation was authorized to conduct affairs in this
45-10 State may thereafter be made on such corporation by service thereof
45-11 on the Secretary of State.
45-12 (5) A street or post office address to which the
45-13 Secretary of State may mail a copy of any process against the
45-14 corporation that may be served on him.
45-15 (6) A statement that all sums due, or accrued, to this
45-16 State have been paid, or that adequate provision has been made for
45-17 the payment thereof.
45-18 (7) A statement that all known creditors or claimants
45-19 have been paid or provided for and that the corporation is not
45-20 involved in or threatened with litigation in any court in this
45-21 State, or that adequate provision has been made for the
45-22 satisfaction of any judgment, order or decree which may be entered
45-23 against it in any pending suits.
45-24 SECTION 33. Section B, Article 8.15, Texas Non-Profit
45-25 Corporation Act (Article 1396-8.15, Vernon's Texas Civil Statutes),
45-26 is amended to read as follows:
45-27 B. The certificate of authority of a foreign corporation to
46-1 conduct affairs in this state may be revoked by order of the
46-2 Secretary of State when it is established that it is in default in
46-3 any of the following particulars:
46-4 (1) The corporation has failed to file any report
46-5 within the time required by law, or has failed to pay any fees,
46-6 franchise taxes, or penalties prescribed by law when the same have
46-7 become due and payable; or
46-8 (2) The corporation has failed to maintain a
46-9 registered agent in this state as required by law; or
46-10 (3) The corporation has changed any information
46-11 reflected on its original or amended application for a certificate
46-12 of authority, including the change of its corporate name or a
46-13 change in the purposes authorized by its existing certificate of
46-14 authority <its corporate name> and has failed to file with the
46-15 Secretary of State within thirty days after such change <of name>
46-16 became effective, an application for an amended certificate of
46-17 authority, or that the corporation has changed its corporate name
46-18 and that the newly adopted name is not available for use in this
46-19 state; or
46-20 (4) The corporation has failed to pay the filing fee
46-21 for the corporation's certificate of authority, or the fee was paid
46-22 by an instrument that was dishonored when presented by the state
46-23 for payment.
46-24 SECTION 34. Article 9.10, Texas Non-Profit Corporation Act
46-25 (Article 1396-9.10, Vernon's Texas Civil Statutes), is amended by
46-26 adding Sections C and D to read as follows:
46-27 C. The articles of incorporation may provide that any action
47-1 required by this Act to be taken at a meeting of the members or
47-2 directors of a corporation or any action that may be taken at a
47-3 meeting of the members or directors or of any committee may be
47-4 taken without a meeting if a consent in writing, setting forth the
47-5 action to be taken, is signed by a sufficient number of members,
47-6 directors, or committee members as would be necessary to take that
47-7 action at a meeting at which all of the members, directors, or
47-8 members of the committee were present and voted. Any written
47-9 consent shall bear the date of signature of each member, director,
47-10 or committee member who signs the consent. A written consent
47-11 signed by less than all of the members, directors, or committee
47-12 members is not effective to take the action that is the subject of
47-13 the consent unless, within 60 days after the date of the earliest
47-14 dated consent delivered to the corporation in the manner required
47-15 by this article, a consent signed by the required number of
47-16 members, directors, or committee members is delivered to the
47-17 corporation to its registered office, registered agent, principal
47-18 place of business, transfer agent, registrar, exchange agent, or an
47-19 officer or agent of the corporation having custody of the books in
47-20 which proceedings of meetings of members, directors, or committees
47-21 are recorded. Delivery shall be by hand or certified or registered
47-22 mail, return receipt requested. Delivery to the corporation's
47-23 principal place of business shall be addressed to the president or
47-24 principal executive officer of the corporation. Prompt notice of
47-25 the taking of any action by members, directors, or a committee with
47-26 a meeting by less than unanimous written consent shall be given to
47-27 all members, directors, or committee members who did not consent in
48-1 writing to the action. If any action by members, directors, or a
48-2 committee is taken by written consent signed by less than all of
48-3 the members, directors, or committee members, any articles or
48-4 documents filed with the Secretary of State as a result of the
48-5 taking of the action shall state, in lieu of any statement required
48-6 by this Act concerning any vote of the members or directors, that
48-7 written consent has been given in accordance with the provisions of
48-8 this article and that any written notice required by this article
48-9 has been given.
48-10 D. A telegram, telex, cablegram, or similar transmission by
48-11 a member, director, or member of a committee or a photographic,
48-12 photostatic, facsimile, or similar reproduction of a writing signed
48-13 by a member, director, or member of a committee shall be regarded
48-14 as signed by the member, director, or member of a committee for
48-15 purposes of this article.
48-16 SECTION 35. Article 10.04, Texas Non-Profit Corporation Act
48-17 (Article 1396-10.04, Vernon's Texas Civil Statutes), is amended to
48-18 read as follows:
48-19 Art. 10.04. To What Corporations This Act Applies; Procedure
48-20 for Adoption of Act by Existing Corporation. A. This Act does not
48-21 apply to domestic corporations organized under any statute other
48-22 than this Act or to any foreign corporations granted authority to
48-23 conduct affairs within this State under any statute other than this
48-24 Act. If any domestic corporation is organized under or is governed
48-25 by a statute that does not contain a provision regarding a matter
48-26 provided for in this Act, or any foreign corporation is granted
48-27 authority to conduct affairs within this State under a statute that
49-1 does not contain a provision regarding a matter provided for in
49-2 this Act in respect of foreign corporations, or if a statute
49-3 specifically provides that the general laws for incorporation or
49-4 for the granting of a certificate of authority to conduct affairs
49-5 in this State supplement the provisions of that statute, the
49-6 provisions of this Act apply only to the extent not inconsistent
49-7 with the provisions of the other statute or with the express
49-8 provisions of the corporation's articles of incorporation or
49-9 bylaws. <Until September 1, 1961, this Act shall not apply to any
49-10 domestic corporation duly chartered and existing on the effective
49-11 date of this Act, or to any foreign corporation, unless such
49-12 domestic corporation shall voluntarily elect to adopt the
49-13 provisions of this Act and shall comply with the procedure
49-14 prescribed by Section B of this Article, and unless such foreign
49-15 corporation shall procure a certificate of authority pursuant to
49-16 Part Eight of this Act.>
49-17 <B. From and after the effective date of this Act and prior
49-18 to September 1, 1961, any domestic corporation duly chartered and
49-19 existing on the effective date of this Act may voluntarily elect to
49-20 adopt the provisions of this Act and may become subject to its
49-21 provisions by taking the following steps:>
49-22 <(1) A resolution reciting that the corporation
49-23 voluntarily adopts this Act shall be adopted by the board of
49-24 directors and/or the members in accordance with the procedure
49-25 prescribed by this Act for the amendment of articles of
49-26 incorporation of such corporation.>
49-27 <(2) Upon adoption of the required resolution or
50-1 resolutions, an instrument shall be executed in duplicate by the
50-2 corporation by its president or a vice-president and by its
50-3 secretary or an assistant secretary, and verified by one of the
50-4 officers signing such statement, which shall set forth:>
50-5 <(a) The name of the corporation.>
50-6 <(b) Each resolution adopted by the corporation.>
50-7 <(c) The date of the adoption of each
50-8 resolution.>
50-9 <(d) The street address of its initial
50-10 registered office and the name of its initial registered agent at
50-11 such address.>
50-12 <(3) Duplicate originals of such document shall be
50-13 delivered to the Secretary of State. If the Secretary of State
50-14 finds that such document conforms to law, he shall, when all fees
50-15 and franchise taxes have been paid as prescribed by law:>
50-16 <(a) Endorse on each of such duplicate originals
50-17 the word "Filed," and the month, day, and year of the filing
50-18 thereof.>
50-19 <(b) File one of such duplicate originals in his
50-20 office.>
50-21 <(c) Deliver the other duplicate original to the
50-22 corporation or its representative.>
50-23 <(4) Upon the filing of such document, all provisions
50-24 of this Act shall thereafter apply to the corporation; provided,
50-25 however, that such delivery to and filing by the Secretary of State
50-26 need not precede action by the directors and/or the members of a
50-27 corporation in connection with amendments to its articles of
51-1 incorporation or its by-laws under this Act so long as (a) such
51-2 amendments do not become effective until after the Secretary of
51-3 State has filed the document whereby such corporation adopts this
51-4 Act and (b) the procedures and requirements of this Act for the
51-5 adoption of such amendments, including requirements as to notice,
51-6 shall have been complied with and satisfied.>
51-7 <C. Except for the exceptions and limitations of Section A
51-8 of this Article, this Act shall apply to all domestic corporations
51-9 organized after the date on which this Act becomes effective and to
51-10 all domestic corporations electing to adopt this Act and
51-11 manifesting their election in the manner provided in Section B of
51-12 this Article, prior to September 1, 1961.>
51-13 <D. From and after September 1, 1961, this Act shall apply
51-14 to all domestic corporations and to all foreign corporations
51-15 conducting or seeking to conduct affairs within this State. Those
51-16 domestic corporations existing at the time that this Act becomes
51-17 effective which have not meanwhile adopted this Act by complying
51-18 with Section B of this Article shall, on September 1, 1961, be
51-19 deemed to have elected to adopt this Act by not voluntarily
51-20 dissolving.>
51-21 <E. No foreign corporation shall conduct affairs in this
51-22 State after September 1, 1961, unless and until it shall have
51-23 procured a certificate of authority in accordance with the
51-24 requirements of Part Eight of this Act. Such certificates may be
51-25 applied for and issued at any time after the effective date of this
51-26 Act and this Act shall thereafter apply to such corporation from
51-27 the date of the issuance of its certificate of authority; provided,
52-1 however, that if such corporation expressly so requests in its
52-2 application, the effective date of its certificate may be delayed
52-3 until September 1, 1961, even though issued prior to such date.>
52-4 B. <F.> In so far as the same are not inconsistent with or
52-5 contrary to any applicable provision of the Insurance Code of
52-6 Texas, or any amendment thereto, the provisions of this Act shall
52-7 apply to and govern burial associations as defined in Article
52-8 14.37, Texas Insurance Code local mutual aid associations,
52-9 statewide mutual assessment corporations, and county mutual
52-10 insurance companies; provided however, (a) that any such mutual
52-11 insurance associations or companies may, upon advance approval of
52-12 the Commissioner of Insurance, pay dividends to its members, and
52-13 (b) that wherever in this Act some duty, responsibility, power,
52-14 authority, or act is vested in, required of, or to be performed by
52-15 the Secretary of State, such is to be vested in, required of, or
52-16 performed by the Commissioner of Insurance in so far as such mutual
52-17 insurance companies or associations are concerned.
52-18 C. <G.> This Act shall not apply to those corporations
52-19 excepted under Article 2.01 B, Subsections (3), (4), and (5) of
52-20 this Act; provided however, that if any of said excepted domestic
52-21 corporations were heretofore or are hereafter organized not for
52-22 profit under special statutes which contain no provisions in regard
52-23 to some of the matters provided for in this Act, or if such special
52-24 statutes specifically applicable provide that the general laws for
52-25 incorporation shall supplement the provisions of such statutes,
52-26 then the provisions of this Act shall apply to the extent that they
52-27 are not inconsistent with the provisions of such special statutes.
53-1 SECTION 36. The Texas Non-Profit Corporation Act (Article
53-2 1396-1.01 et seq., Vernon's Texas Civil Statutes) is amended by
53-3 adding Article 10.07 to read as follows:
53-4 Art. 10.07. DELAYED EFFECTIVENESS OF CERTAIN FILINGS. A.
53-5 In this article the following are permitted acts:
53-6 (1) the incorporation of a corporation under this Act;
53-7 (2) an amendment to a corporation's articles of
53-8 incorporation;
53-9 (3) the restatement of articles of incorporation of a
53-10 corporation;
53-11 (4) a voluntary dissolution;
53-12 (5) the authorization or withdrawal of a foreign
53-13 corporation to conduct affairs in this State;
53-14 (6) an amendment to the certificate of authority of a
53-15 foreign corporation;
53-16 (7) a change in registered office or registered agent;
53-17 or
53-18 (8) a change of address of a registered agent.
53-19 B. A permitted act may be made effective as of a time and
53-20 date after the time and date otherwise provided in this Act or may
53-21 be made effective on the occurrence of events or facts that may
53-22 occur in the future. Those events or facts may include future acts
53-23 of any person or entity, if:
53-24 (1) the articles, statement, application, or other
53-25 filing that is required by this Act to be filed with the Secretary
53-26 of State to make the permitted act effective clearly and expressly
53-27 sets forth, in addition to any other statement or information
54-1 required to be set forth:
54-2 (a) the time and date on which the permitted act
54-3 is to become effective; or
54-4 (b) if the permitted act is to become effective
54-5 on the occurrence of events or facts that may occur in the future,
54-6 the manner in which the events or facts will operate to cause the
54-7 permitted act to become effective;
54-8 (2) in the case of a permitted act that is to become
54-9 effective on the mere passage of time as of a time or date after
54-10 the time and date otherwise provided in this Act, the subsequent
54-11 time and date must not be more than 180 days after the date of the
54-12 filing of the articles, statement, application, or other filing
54-13 that is otherwise required by this Act to be filed with the
54-14 Secretary of State to make effective the permitted act; and
54-15 (3) in the case of a permitted act that is to be made
54-16 effective on the occurrence of events or facts that may occur in
54-17 the future, other than the mere passage of time, a statement that
54-18 all the events or facts on which the effectiveness of the permitted
54-19 act is conditioned have been satisfied or waived and the date on
54-20 which the condition was satisfied or waived must be filed with the
54-21 Secretary of State within 180 days of the date of the filing of the
54-22 articles, statement, application, or other filing that is otherwise
54-23 required by this Act for the permitted act to become effective.
54-24 C. The statement required by Section A(3) of this article
54-25 shall be executed on behalf of each domestic or foreign corporation
54-26 or other entity that was required to execute the articles,
54-27 statement, application, or other filing that is otherwise required
55-1 by this Act to be filed with the Secretary of State to make
55-2 effective the permitted act by an officer or other duly authorized
55-3 representative, including an officer or duly authorized
55-4 representative of any successor domestic or foreign corporation or
55-5 other entity, and an original and copy shall be filed with the
55-6 Secretary of State. If the Secretary of State finds that the
55-7 statement conforms to the provisions of this Act, the Secretary of
55-8 State shall:
55-9 (1) endorse on the original and the copy the word
55-10 "Filed" and the month, day, and year of the filing;
55-11 (2) file the original in the Secretary of State's
55-12 office; and
55-13 (3) return the copy to the filing party or its
55-14 representative.
55-15 D. If any permitted act is to become effective as of a time
55-16 or date after the time and date otherwise provided in this Act, for
55-17 the permitted act to become effective, notwithstanding any other
55-18 provision of this Act to the contrary, the permitted act shall
55-19 become, to the extent permitted by Section A of this article,
55-20 effective as of the subsequent time and date, and any certificate
55-21 issued by the Secretary of State on the filing of the articles,
55-22 statement, application, or other filing that is otherwise required
55-23 by this Act for the permitted act to become effective shall
55-24 expressly state the time and date on which the permitted act is to
55-25 become effective.
55-26 E. If a permitted act is to be made effective on the
55-27 occurrence of events or facts that may occur in the future, other
56-1 than the mere passage of time, and the statement required by
56-2 Section A(3) of this article is filed with the Secretary of State
56-3 within the time prescribed, the permitted act becomes effective as
56-4 of the time and date on which the latest specified event or fact
56-5 occurs or the time and date on which the condition is otherwise
56-6 satisfied or waived. Any certificate issued or notation,
56-7 acknowledgement, or other statement made by the Secretary of State
56-8 on the filing of the articles, statement, application, or other
56-9 filing that is otherwise required by this Act for the permitted act
56-10 to become effective shall state that "The effectiveness of the
56-11 action to which this instrument relates is conditioned on the
56-12 occurrence of certain facts or events described in the filing to
56-13 which this instrument relates" or shall make reference in a manner
56-14 the Secretary of State approves, to the fact that the effectiveness
56-15 of the action is conditioned. The time and date on which a
56-16 condition to the effectiveness of a permitted act is satisfied or
56-17 waived as set forth in a statement filed with the Secretary of
56-18 State pursuant to Section A(3) of this article shall be
56-19 conclusively regarded as the time and date on which the condition
56-20 was satisfied or waived for purposes of this article.
56-21 F. If the effectiveness of any permitted act is conditioned
56-22 on the occurrence of events or facts that may occur in the future,
56-23 other than the mere passage of time, and the statement required by
56-24 Section A(3) of this article is not filed with the Secretary of
56-25 State within the time prescribed, the permitted act is not
56-26 effective unless there is subsequently filed with the Secretary of
56-27 State the articles, statement, application, or other filing
57-1 required by this Act to be filed with the Secretary of State to
57-2 make the permitted act effective.
57-3 SECTION 37. This Act takes effect September 1, 1993.
57-4 SECTION 38. The importance of this legislation and the
57-5 crowded condition of the calendars in both houses create an
57-6 emergency and an imperative public necessity that the
57-7 constitutional rule requiring bills to be read on three several
57-8 days in each house be suspended, and this rule is hereby suspended.