1-1 By: Harris S.B. No. 1617
1-2 (In the Senate - Filed March 23, 1995; March 27, 1995, read
1-3 first time and referred to Committee on Economic Development;
1-4 April 20, 1995, reported favorably, as amended, by the following
1-5 vote: Yeas 8, Nays 0; April 20, 1995, sent to printer.)
1-6 COMMITTEE AMENDMENT NO. 1 By: Harris
1-7 Amend S.B. No. 1617, introduced version, as follows:
1-8 (1) In Section 3.10, as renumbered by the bill (page 1, line
1-9 16, through page 4, line 8; committee printing page 8, line 41,
1-10 through page 9, line 43), strike Subsection (A) and substitute the
1-11 following:
1-12 (A) One or more persons, may act as trust manager(s) of a real
1-13 estate investment trust by subscribing and acknowledging to a
1-14 declaration of trust before an officer duly authorized to take
1-15 acknowledgments of deeds, which shall set forth:
1-16 (1) The name of the real estate investment trust and a
1-17 statement that an assumed name certificate setting forth such name
1-18 has been filed in the manner prescribed by law.
1-19 (2) A statement that it is formed pursuant to the
1-20 provisions of this Act and has the following as its purpose:
1-21 To purchase, hold, lease, manage, sell, exchange,
1-22 develop, subdivide and improve real property and interests in real
1-23 property, and in general, to carry on any other business and do any
1-24 other acts in connection with the foregoing and to have and
1-25 exercise all powers conferred by the laws of the State of Texas
1-26 upon real estate investment trusts formed under the Texas Real
1-27 Estate Investment Trust Act, and to do any or all of the things
1-28 hereinafter set forth to the same extent as natural persons might
1-29 or could do. The term "real property" and the term "interests in
1-30 real property" for the purposes stated herein shall not include
1-31 severed mineral, oil or gas royalty interests.
1-32 (3) <As to any real property of any character, major
1-33 capital improvements must be made within fifteen (15) years of
1-34 purchase or the property must be sold. Such major capital
1-35 improvements must equal or exceed the purchase price of such real
1-36 property, if the same is unimproved property at the time of
1-37 purchase or property outside the corporate limits of a city, town
1-38 or village. Any citizen of the State of Texas may force compliance
1-39 with this provision by filing suit in any district court of this
1-40 state and shall receive from such real estate investment trust
1-41 forced to sell under this provision the sum of five per cent (5%)
1-42 of the sale price of such real property interest as compensation.>
1-43 <(4)> The post office address of its initial principal
1-44 office and place of business.
1-45 (4) The street address of its registered office and
1-46 the name of its registered agent at that address.
1-47 (5) The name and business address, and post office
1-48 address, if different from the business address, of each trust
1-49 manager<, specifying the resident trust manager>.
1-50 (6) The period of its duration, which may be for a
1-51 term of years or perpetual.
1-52 (7) The aggregate number of shares of beneficial
1-53 interest the real estate investment trust shall have authority to
1-54 issue and the par value to be received by the real estate
1-55 investment trust for the issuance of each of such shares. If the
1-56 shares are divided into classes as permitted by Section 3.30 <3.1>
1-57 of this Act <Article>, the declaration shall provide a description
1-58 of each class, including any preferences, conversion, and other
1-59 rights, voting powers, restrictions, limitations as to dividends,
1-60 qualifications, and terms and conditions of redemption.
1-61 (8) <A statement that shares of beneficial interests
1-62 will be issued only for money or property actually received.>
1-63 <(9)> A statement that the trust manager(s) shall
1-64 manage <hold> the money or property received for the issuance of
1-65 shares for the benefit of the shareholders of the real estate
1-66 investment trust <owners of such shares>.
1-67 (9) <(10)> A statement that the real estate investment
1-68 trust will not commence business until it has received for the
2-1 issuance of shares of beneficial interest consideration of at least
2-2 a $1,000 value, consisting of any tangible or intangible benefit to
2-3 the real estate investment trust, including cash, promissory notes,
2-4 services performed for, contracts for services to be performed for,
2-5 or other securities of the real estate investment trust <operations
2-6 until the beneficial ownership is held by one hundred or more
2-7 persons with no five (5) persons owning more than fifty per cent
2-8 (50%) of the total number of outstanding shares of beneficial
2-9 interest. The word person as used herein shall not include
2-10 corporations>.
2-11 (10) <(11)> Any provision, not inconsistent with law,
2-12 including any provision which under this Act is permitted to be set
2-13 forth in the bylaws <by-laws>, which the trust manager(s) elect to
2-14 set forth in the declaration of trust for the regulation of the
2-15 internal affairs of the real estate investment trust.
2-16 (2) In the first sentence of proposed Subsection (C) of
2-17 Section 4.10, as renumbered by the bill (page 10, line 7; committee
2-18 printing page 11, line 64), strike "manager" and substitute
2-19 "managers".
2-20 (3) In Section 5.10, as renumbered by the bill (page 19,
2-21 line 22, through page 20, line 12; committee printing page 15, line
2-22 42, through page 15, line 59), strike proposed Subsection (F) and
2-23 substitute the following:
2-24 (F) The address of the location of the registered office in
2-25 this state for a real estate investment trust may be changed to
2-26 another address on filing with the county clerk of the county where
2-27 the declaration of trust was filed a statement that is executed by
2-28 the registered agent for the real estate investment trust, or if
2-29 the agent is a corporation or real estate investment trust, by an
2-30 officer on behalf of the corporation or the real estate investment
2-31 trust, and that sets forth:
2-32 (1) The name of the real estate investment trust
2-33 represented by the registered agent.
2-34 (2) The address at which the registered agent has
2-35 maintained the registered office for the real estate investment
2-36 trust.
2-37 (3) The new address at which the registered agent will
2-38 maintain the registered office for the real estate investment
2-39 trust.
2-40 (4) A statement that written notice of the change of
2-41 address has been given to the real estate investment trust at least
2-42 10 days before the filing of the statement required by this
2-43 Section.
2-44 (4) In proposed Section 5.20 (page 21, between lines 12 and
2-45 13; committee printing page 16, between lines 16 and 17), add a new
2-46 Subsection (D) to read as follows:
2-47 (D) The secretary of state shall collect for state use the
2-48 fee for maintaining a record of service of any process, notice, or
2-49 demand on the secretary of state as agent for any real estate
2-50 investment trust under this section that is established by Section
2-51 A(20), Article 10.01, Texas Business Corporation Act.
2-52 (5) In proposed Subdivision (19), Subsection (A), of Section
2-53 6.10, as renumbered by the bill (page 24, line 9; committee
2-54 printing page 17, line 24), between "1986" and "that", insert "(or
2-55 any successor statute)".
2-56 (6) In proposed Section 7.20 (page 26, line 19, through page
2-57 27, line 12; committee printing page 18, line 18, through page 18,
2-58 line 38), strike proposed Subsection (A) and substitute the
2-59 following:
2-60 (A) A real estate investment trust shall deliver certificates
2-61 representing shares to which shareholders are entitled, or the
2-62 shares of a real estate investment trust may be uncertificated
2-63 shares. Unless otherwise provided by the declaration of trust or
2-64 bylaws, the trust manager(s) of a real estate investment trust by
2-65 resolution may provide that some or all of any or all classes and
2-66 series of its shares shall be uncertificated shares; provided, that
2-67 the resolution may not apply to shares represented by a certificate
2-68 until the certificate is surrendered to the real estate investment
2-69 trust. Certificates representing shares shall be signed by the
2-70 officer or officers prescribed by the bylaws of the real estate
3-1 investment trust to sign the shares, and may be sealed with the
3-2 seal of the real estate investment trust, if any, or a facsimile of
3-3 the seal. The signatures of the officer or officers on a
3-4 certificate may be facsimiles. If an officer who has signed or
3-5 whose facsimile signature has been placed on the certificate ceases
3-6 to serve as an officer before the certificate is issued, the real
3-7 estate investment trust may issue the certificate, and the
3-8 certificate has the same effect as if that officer were serving as
3-9 an officer on the date of the certificate's issuance.
3-10 (7) In proposed Section 7.20 (page 28, line 17, through page
3-11 29, line 8; committee printing page 18, line 70, through page 19,
3-12 line 18), strike Subsections (D) and (E) and substitute the
3-13 following:
3-14 (D) In accordance with Chapter 8, Business & Commerce Code,
3-15 a real estate investment trust, after the issuance or transfer of
3-16 uncertificated shares, shall send to the registered owner of
3-17 uncertificated shares a written notice containing the information
3-18 required to be set forth or stated on certificates under this Act.
3-19 Except as otherwise expressly provided by law, the rights and
3-20 obligations of the holders of uncertificated shares and the rights
3-21 and obligations of the holders of certificates representing shares
3-22 of the same class and series must be identical. A share may not be
3-23 issued until the consideration for the share, fixed as provided by
3-24 law, has been fully paid.
3-25 (E) A requirement of this Act regarding matters to be set
3-26 forth on certificates representing shares of a real estate
3-27 investment trust may not apply to or affect certificates
3-28 outstanding when the requirement first becomes applicable to the
3-29 certificates, but the requirement shall apply to all certificates
3-30 issued after the requirement becomes applicable, whether the
3-31 requirement relates to an original issue of shares, a transfer of
3-32 shares, or otherwise.
3-33 (8) In Subsection (B) of Section 7.30, as renumbered by the
3-34 bill (page 30, line 27; committee printing page 19, line 64),
3-35 strike "for" each time it appears after "performed".
3-36 (9) In Subdivision (2)(b) of Subsection (B) of Section 9.20,
3-37 as renumbered by the bill (page 41, line 26; committee printing
3-38 page 24, line 10), between "cases" and "that", insert ",".
3-39 (10) In the last sentence of Subsection (A) of Section
3-40 10.30, as renumbered by the bill (page 52, line 24; committee
3-41 printing page 28, line 25), strike "or with the secretary of state"
3-42 and substitute "<or with the secretary of state>".
3-43 (11) In the last sentence of Subsection (B) of Section
3-44 10.30, as renumbered by the bill (page 53, lines 7-8; committee
3-45 printing page 28, lines 35-36), strike "or with the secretary of
3-46 state" and substitute "<or with the secretary of state>".
3-47 (12) In proposed Subsection (H) of Section 13.10, as
3-48 renumbered by the bill (page 68, line 12; committee printing page
3-49 34, line 26), between "name" and "if", insert ",".
3-50 (13) In Subsection (A) of Section 15.10, as renumbered by
3-51 the bill (page 77, line 12, through page 78, line 10; committee
3-52 printing page 37, line 59, through page 38, line 14), strike
3-53 Subdivisions (2) and (3) and substitute the following:
3-54 (2) The trust manager(s) of a real estate investment
3-55 trust who vote for or assent to the making of a loan to an officer
3-56 or trust manager(s) of the real estate investment trust or the
3-57 making of any loans secured by the shares of the real estate
3-58 investment trust, shall be jointly and severally liable to the real
3-59 estate investment trust for the amount of such loan until the
3-60 repayment thereof.
3-61 (3) If the real estate investment trust shall commence
3-62 business <operations> before the real estate investment trust has
3-63 received for the issuance of shares of beneficial interest
3-64 consideration of at least a $1,000 value, consisting of any
3-65 tangible or intangible benefit to the real estate investment trust,
3-66 including cash, promissory notes, services performed, contracts for
3-67 services to be performed, or other securities of the real estate
3-68 investment trust <beneficial ownership is held by one hundred (100)
3-69 or more persons with no five (5) persons owning more than fifty per
3-70 cent (50%) of the total number of outstanding shares of beneficial
4-1 interest>, the real estate investment trust manager(s) who assent
4-2 thereto shall be jointly and severally liable to the trust for the
4-3 part of the required consideration that has not been received
4-4 before commencing business <all debts and obligations incurred by
4-5 the trust prior to the time the beneficial ownership is so held>,
4-6 but such liability shall be terminated when the real estate
4-7 investment trust has actually received the required consideration
4-8 for the issuance <issued the required number> of shares.
4-9 (14) Insert a new proposed Section 19.20 (page 82, between
4-10 lines 19 and 20; committee printing page 39, between lines 61 and
4-11 62) to read as follows:
4-12 Sec. 19.20. ARTICLES OF DISSOLUTION. (A) On the
4-13 termination and liquidation of the real estate investment trust, an
4-14 officer shall execute articles of dissolution on behalf of the real
4-15 estate investment trust and the articles of dissolution shall set
4-16 forth:
4-17 (1) The name of the real estate investment trust.
4-18 (2) The names and respective addresses of its
4-19 officers.
4-20 (3) The names and respective addresses of its trust
4-21 managers.
4-22 (4) That all remaining property and assets of the real
4-23 estate investment trust have been distributed among its
4-24 shareholders in accordance with the shareholders' respective rights
4-25 and interests after applying the property and assets to the just
4-26 and equitable payment of the liabilities and obligations of the
4-27 real estate investment trust.
4-28 (5) The date of the adoption of the resolution to
4-29 dissolve the real estate investment trust by the shareholders of
4-30 the real estate investment trust.
4-31 (6) The number of shares outstanding and the number of
4-32 shares entitled to vote on the dissolution and if the shares of any
4-33 class or series are entitled to vote on the dissolution as a class,
4-34 the designation and number of outstanding shares entitled to vote
4-35 on the dissolution of each of those classes or series.
4-36 (7) The number of shares voted for and against the
4-37 dissolution, respectively, and if the shares of any class or series
4-38 are entitled to vote on the dissolution as a class, the number of
4-39 shares of each of those classes or series that voted for and
4-40 against the dissolution.
4-41 (B) A copy of the articles of dissolution shall be filed
4-42 with the county clerk of the county of the principal place of
4-43 business of the real estate investment trust.
4-44 (C) On the filing of the articles of dissolution with the
4-45 county clerk of the county of the principal place of business of
4-46 the real estate investment trust, the real estate investment trust
4-47 shall cease to exist.
4-48 (15) Strike proposed Section 22.60 (page 89, lines 12-23;
4-49 committee printing page 40, lines 34-45), and substitute the
4-50 following:
4-51 Sec. 22.60. EFFECT OF FILING OF ARTICLES OF AMENDMENT.
4-52 (A) On the filing of the articles of amendment with the county
4-53 clerk of the county of the principal place of business of the real
4-54 estate investment trust, the amendment becomes effective and the
4-55 declaration of trust is considered to be amended accordingly.
4-56 (B) An amendment may not affect any existing cause of action
4-57 in favor of or against the real estate investment trust, or any
4-58 pending suit to which the real estate investment trust is a party,
4-59 or the existing rights of persons other than shareholders. If the
4-60 name of a real estate investment trust is changed by amendment, a
4-61 suit brought by or against the real estate investment trust under
4-62 its former name may not be abated for that reason.
4-63 (16) In proposed Subsection (A) of Section 23.10, as
4-64 renumbered by the bill (page 92, line 19, through page 93, line 3;
4-65 committee printing page 43, line 52, through page 43, line 63),
4-66 strike Subdivision (2) and substitute the following:
4-67 (2)(i) the merger is permitted by the laws of the
4-68 state or country under whose law each corporation, if any, that is
4-69 a party to the merger is incorporated, (ii) the merger is either
4-70 permitted by the laws under which each other entity that is a party
5-1 to the merger is organized or by the constituent documents of the
5-2 other entity that are not inconsistent with those laws, and (iii)
5-3 each domestic or foreign corporation, real estate investment trust,
5-4 partnership or other entity that is a party to the merger complies
5-5 with those laws or documents in effecting the merger, if one or
5-6 more domestic or foreign corporations, real estate investment
5-7 trusts, partnerships or other entities is a party to the merger or
5-8 is to be created by the terms of the plan of merger; and
5-9 (17) In proposed Subsection (A) of proposed Section 23.20
5-10 (page 102, line 27, through page 103, line 7; committee printing
5-11 page 47, line 50, through page 47, line 57), strike Subdivision (2)
5-12 and substitute the following:
5-13 (2) the issuance of shares or interests issued as part
5-14 of the plan of exchange is either permitted by the laws under which
5-15 the domestic or foreign corporations, real estate investment
5-16 trusts, partnerships or other entities are incorporated or
5-17 organized or not inconsistent with those laws, if one or more
5-18 foreign corporations, real estate investment trusts, partnerships
5-19 or other entities are to issue shares or other interests as part of
5-20 the plan of exchange; and
5-21 (18) In the last sentence of proposed Subdivision (1),
5-22 proposed Subsection (B) of proposed Section 23.30 (page 105, line
5-23 11; committee printing page 48, line 45), strike "manager's" and
5-24 substitute "managers'".
5-25 (19) In proposed Subsection (C) of proposed Section 23.30
5-26 (page 105, line 15; committee printing page , line ), strike
5-27 "manager's" and substitute "managers'".
5-28 (20) In proposed Section 23.30 (pages 108, line 18, through
5-29 page 109, line 21; committee printing page 49, line 63, and page
5-30 50, line 23), strike proposed Subsections (I) and (J) and
5-31 substitute the following:
5-32 (I) After a merger or share exchange is approved, and at any
5-33 time before the merger or share exchange has become effective, the
5-34 plan of merger or share exchange may be abandoned (subject to any
5-35 contractual rights) by any of the real estate investment trusts
5-36 that are a party to the merger, without shareholder action, in
5-37 accordance with the procedures set forth in the plan of merger or
5-38 exchange, or, if no such procedures are set forth in the plan, in
5-39 the manner determined by the trust manager(s). If articles of
5-40 merger or exchange have been filed with the county clerk of the
5-41 county of the principal place of business of the real estate
5-42 investment trust but the merger or share exchange has not become
5-43 effective, the merger or share exchange may be abandoned as
5-44 provided in this Subsection if a statement, executed on behalf of
5-45 each domestic and foreign entity that is a party to the merger or
5-46 share exchange by an officer or other duly authorized
5-47 representative of the domestic or foreign entity, and stating that
5-48 the plan of merger or exchange has been abandoned in accordance
5-49 with the plan and this Subsection, is filed with the county clerk
5-50 in each county where the principal place of business of a Texas
5-51 real estate investment trust that is a party to the merger or
5-52 exchange is located before the merger or share exchange takes
5-53 effect.
5-54 (J) On the filing with the county clerk of the county of the
5-55 principal place of business of the real estate investment trust of
5-56 the statement described by Subsection (I) of this Section, the
5-57 merger or share exchange is considered abandoned and may not take
5-58 effect.
5-59 (21) In proposed Subsection (A) of proposed Section 23.40
5-60 (page 111, line 24, through page 112, line 1; committee printing
5-61 page 51, line 10, through page 51, line 14), strike Subdivision (6)
5-62 and substitute the following:
5-63 (6) For each domestic or foreign corporation, or other
5-64 entity that is a party to the plan of merger, a statement that the
5-65 approval of the plan of merger was duly authorized by all action
5-66 required by the laws under which it was incorporated or organized
5-67 and by its constituent documents.
5-68 (22) In proposed Section 23.40 (page 112, line 2, through
5-69 page 113, line 11; committee printing page 51, line 15, through
5-70 page 51, line 51), strike proposed Subsections (B), (C), and (D)
6-1 and substitute the following:
6-2 (B) The original of the articles of merger or exchange, and
6-3 the number of copies of the articles that is equal to the number of
6-4 surviving, new, and acquiring domestic or foreign corporations,
6-5 real estate investment trusts, partnerships and other entities that
6-6 are parties to the plan of merger or exchange or that will be
6-7 created by the terms of the plan of merger or exchange thereof,
6-8 shall be filed with the county clerk in each county where the
6-9 principal place of business of a Texas real estate investment trust
6-10 that is a party to the merger or exchange is located.
6-11 (23) Strike proposed Section 23.50 (page 113, lines 12-15;
6-12 committee printing page 51, lines 52-55), and substitute the
6-13 following:
6-14 Sec. 23.50. EFFECTIVE DATE OF MERGER OR SHARE EXCHANGE.
6-15 Except as otherwise provided by Section 27.10 of this Act, the
6-16 merger or share exchange is effective when the articles of merger
6-17 or exchange are filed as required by Section 23.40 of this Act.
6-18 (24) In proposed Section 24.10 (page 117, lines 1-16;
6-19 committee printing page 53, lines 9-24), strike proposed Subsection
6-20 (A) and substitute the following:
6-21 (A) Except as otherwise provided in the declaration of trust and
6-22 except as provided in the next sentence of this Subsection, the
6-23 sale, lease, exchange, or other disposition of all, or
6-24 substantially all, of the property and assets of a real estate
6-25 investment trust, when made in the usual and regular course of the
6-26 business of the real estate investment trust, may be made on the
6-27 terms and conditions and for the consideration, which may consist
6-28 in whole or in part of money or real or personal property,
6-29 including shares of any real estate investment trust or domestic or
6-30 foreign corporation, as authorized by its trust manager(s) without
6-31 authorization or consent of the shareholders. Except as otherwise
6-32 provided in the declaration of trust, the trust manager(s) may
6-33 authorize any pledge, mortgage, deed of trust, or trust indenture,
6-34 and no authorization or consent of the shareholders shall be
6-35 required for the validity of or for any sale pursuant to the terms
6-36 of the pledge, mortgage, deed of trust, or trust indenture.
6-37 (25) In proposed Subsection (C) of proposed Section 25.30
6-38 (page 130, lines 18-20; committee printing page 58, lines 27-29),
6-39 strike proposed Subdivision (2) and substitute the following:
6-40 (2) pursuant to Subsection (B) of this Section, the
6-41 demand terminates the shareholder's rights under Section 25.20 of
6-42 this Act;
6-43 (26) In proposed Subsection (D) of proposed Section 26.10
6-44 (page 135, lines 16-26; committee printing page 60, lines 20-30),
6-45 strike proposed Subdivisions (5) and (6) and substitute the
6-46 following:
6-47 (5) The articles of merger or exchange shall be filed
6-48 with the county clerk in each county where the principal place of
6-49 business of a Texas real estate investment trust that is a party to
6-50 the merger or exchange is located in the manner and with the number
6-51 of copies provided in Section 23.40 of this Act.
6-52 (6) On the filing of the articles of merger or share
6-53 exchange as provided in Section 23.40 of this Act, the merger or
6-54 share exchange becomes effective with the same effect as if the
6-55 merger or share exchange had been adopted by unanimous action of
6-56 the trust managers and shareholders of the real estate investment
6-57 trust being reorganized. The effectiveness of the merger or share
6-58 exchange shall be determined as provided in Section 23.50 of this
6-59 Act.
6-60 (27) Strike proposed Section 27.10 (page 136, line 11,
6-61 through page 140, line 17; committee printing page 60, line 42,
6-62 through page 62, line 16), and substitute the following:
6-63 Sec. 27.10. DELAYED EFFECTIVENESS OF CERTAIN FILINGS.
6-64 (A) A permitted act may be made effective at a time and date after
6-65 the time and date otherwise provided for the permitted act in this
6-66 Act or may be made effective on the occurrence of future events or
6-67 facts, including future acts of any person or entity, if:
6-68 (1) the articles, statement, application, or other
6-69 filing that is required to be filed with the county clerk of the
6-70 county of the principal place of business of the real estate
7-1 investment trust by this Act to make effective the permitted act
7-2 clearly and expressly set forth, in addition to any other statement
7-3 or information required to be set forth in those documents:
7-4 (a) the time and date on which the permitted act
7-5 is to become effective or whether the permitted act is to become
7-6 effective on the occurrence of a future event or fact;
7-7 (b) the manner in which the future event or fact
7-8 shall operate to cause the permitted act to become effective; and
7-9 (c) the date of the 90th day after the date of
7-10 the filing of the articles, statement, application or other filing;
7-11 (2) in the case of a permitted act that is to become
7-12 effective as of a time or date after the time and date otherwise
7-13 provided in this Act, the subsequent time and date is not more than
7-14 90 days after the date of the filing of the articles, statement,
7-15 application, or other filing that is otherwise required by this Act
7-16 to be filed with the county clerk of the county of the principal
7-17 place of business of the real estate investment trust to make
7-18 effective the permitted act and the time on which the permitted act
7-19 is to become effective is not midnight or noon; and
7-20 (3) in the case of a permitted act that is to take
7-21 effect on the occurrence of events or facts that may occur in the
7-22 future, other than the mere passage of time, a statement that all
7-23 the events or facts on which the effectiveness of the permitted act
7-24 is conditioned have been satisfied or waived, including the date on
7-25 which the condition was satisfied or waived, is filed with the
7-26 county clerk of the county of the principal place of business of
7-27 the real estate investment trust within 90 days of the date of the
7-28 filing of the articles, statement, application or other filing that
7-29 is otherwise required by this Act for the permitted act to become
7-30 effective.
7-31 (B) The statement required by Subdivision (3) of Subsection
7-32 (A) of this Section shall be executed on behalf of each domestic or
7-33 foreign real estate investment trust, corporation, partnership, or
7-34 other entity that was required to execute the articles, statement,
7-35 application, or other filing that is otherwise required to be filed
7-36 with the county clerk of the county of the principal place of
7-37 business of the real estate investment trust to make effective the
7-38 permitted act by this Act by an officer or other duly authorized
7-39 representative of the entity, including an officer or duly
7-40 authorized representative of any successor domestic or foreign real
7-41 estate investment trust, corporation, partnership, or other entity.
7-42 The original statement and a copy of the original statement must be
7-43 filed with the county clerk of the county of the principal place of
7-44 business of the real estate investment trust.
7-45 (C) If any permitted act is to take effect as of a time or
7-46 date after the time and date otherwise provided in this Act for the
7-47 permitted act to become effective, notwithstanding any other
7-48 provision of this Act to the contrary, the permitted act, to the
7-49 extent permitted by Subsection (A) of this Section, shall take
7-50 effect on that subsequent time and date.
7-51 (D) If any permitted act is to be made effective on the
7-52 occurrence of future events or facts, other than the mere passage
7-53 of time, and the statement required by Subdivision (3) of
7-54 Subsection (A) of this Section is filed with the county clerk of
7-55 the county of the principal place of business of the real estate
7-56 investment trust within the time prescribed in that Subdivision,
7-57 the permitted act takes effect on the time and date on which the
7-58 latest specified event or fact occurs or the time and date on which
7-59 the condition is otherwise satisfied or waived. The time and date
7-60 on which a condition to the effectiveness of a permitted act is
7-61 satisfied or waived as set forth in a statement filed with the
7-62 county clerk of the county of the principal place of business of
7-63 the real estate investment trust under Subdivision (3) of
7-64 Subsection (A) of this Section shall be conclusively regarded as
7-65 the time and date on which the condition was satisfied or waived
7-66 for purposes of this Section.
7-67 (E) If the effectiveness of any permitted act is conditioned
7-68 on the occurrence of future events or facts, other than the mere
7-69 passage of time, and the statement required by Subdivision (3) of
7-70 Subsection (A) of this Section is not filed with the county clerk
8-1 of the county of the principal place of business of the real estate
8-2 investment trust within the time prescribed in that Subdivision,
8-3 the permitted act may not take effect unless the articles,
8-4 statement, application, or other filing required by this Act to be
8-5 filed with the county clerk to make the permitted act effective are
8-6 subsequently filed with the county clerk of the county of the
8-7 principal place of business of the real estate investment trust.
8-8 (F) In this section, "permitted act" means:
8-9 (1) the formation of a real estate investment trust
8-10 under this Act;
8-11 (2) an amendment to a real estate investment trust's
8-12 declaration of trust, including an amendment effected pursuant to a
8-13 statement of resolution establishing a series of shares;
8-14 (3) the restatement of the declaration of trust of a
8-15 real estate investment trust;
8-16 (4) a merger or share exchange;
8-17 (5) a cancellation of redeemable or reacquired shares
8-18 or a reduction in stated capital;
8-19 (6) a voluntary dissolution;
8-20 (7) a bylaw or agreement restricting the transfer of
8-21 shares or securities of a real estate investment trust pursuant to
8-22 this Act;
8-23 (8) a change in registered office or registered agent;
8-24 or
8-25 (9) a change of address of a registered agent.
8-26 A BILL TO BE ENTITLED
8-27 AN ACT
8-28 relating to the Texas Real Estate Investment Trust Act.
8-29 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
8-30 SECTION 1. The Texas Real Estate Investment Trust Act
8-31 (Article 6138A, Vernon's Texas Civil Statutes) is amended to read
8-32 as follows:
8-33 Art. 6138A. Texas Real Estate Investment Trust Act
8-34 Sec. 1.10 <1>. Short Title. This Act shall be known and may
8-35 be cited as the "Texas Real Estate Investment Trust Act."
8-36 Sec. 2.10 <2>. Real Estate Investment Trust Defined. A real
8-37 estate investment trust is an unincorporated trust formed by one or
8-38 more trust managers under <the provisions of> Section 3.10 <3> of
8-39 this Act and managed in accordance with <the provisions of Section
8-40 4 of> this Act.
8-41 Sec. 3.10 <3>. Formation of real estate investment trust.
8-42 (A) One or more persons, may act as trust manager(s) of a real
8-43 estate investment trust by subscribing and acknowledging to a
8-44 declaration of trust before an officer duly authorized to take
8-45 acknowledgments of deeds, which shall set forth:
8-46 (1) The name of the real estate investment trust and a
8-47 statement that an assumed name certificate setting forth such name
8-48 has been filed in the manner prescribed by law.
8-49 (2) A statement that it is formed pursuant to the
8-50 provisions of this Act and has the following as its purpose:
8-51 To purchase, hold, lease, manage, sell, exchange,
8-52 develop, subdivide and improve real property and interests in real
8-53 property, and in general, to carry on any other business and do any
8-54 other acts in connection with the foregoing and to have and
8-55 exercise all powers conferred by the laws of the State of Texas
8-56 upon real estate investment trusts formed under the Texas Real
8-57 Estate Investment Trust Act, and to do any or all of the things
8-58 hereinafter set forth to the same extent as natural persons might
8-59 or could do. The term "real property" and the term "interests in
8-60 real property" for the purposes stated herein shall not include
8-61 severed mineral, oil or gas royalty interests.
8-62 (3) <As to any real property of any character, major
8-63 capital improvements must be made within fifteen (15) years of
8-64 purchase or the property must be sold. Such major capital
8-65 improvements must equal or exceed the purchase price of such real
8-66 property, if the same is unimproved property at the time of
8-67 purchase or property outside the corporate limits of a city, town
8-68 or village. Any citizen of the State of Texas may force compliance
8-69 with this provision by filing suit in any district court of this
8-70 state and shall receive from such real estate investment trust
9-1 forced to sell under this provision the sum of five per cent (5%)
9-2 of the sale price of such real property interest as compensation.>
9-3 <(4)> The post office address of its initial principal
9-4 office and place of business.
9-5 (4) <(5)> The name and business address, and post
9-6 office address, if different from the business address, of each
9-7 trust manager<, specifying the resident trust manager>.
9-8 (5) <(6)> The period of its duration, which may be for
9-9 a term of years or perpetual.
9-10 (6) <(7)> The aggregate number of shares of beneficial
9-11 interest the real estate investment trust shall have authority to
9-12 issue and the par value to be received by the real estate
9-13 investment trust for the issuance of each of such shares. If the
9-14 shares are divided into classes as permitted by Section 3.30 <3.1>
9-15 of this Act <Article>, the declaration shall provide a description
9-16 of each class, including any preferences, conversion, and other
9-17 rights, voting powers, restrictions, limitations as to dividends,
9-18 qualifications, and terms and conditions of redemption.
9-19 (7) <(8) A statement that shares of beneficial
9-20 interests will be issued only for money or property actually
9-21 received.>
9-22 <(9)> A statement that the trust manager(s) shall
9-23 manage <hold> the money or property received for the issuance of
9-24 shares for the benefit of the shareholders of the real estate
9-25 investment trust <owners of such shares>.
9-26 (8) <(10)> A statement that the real estate investment
9-27 trust will not commence business until it has received for the
9-28 issuance of shares of beneficial interest consideration of at least
9-29 a $1,000 value, consisting of any tangible or intangible benefit to
9-30 the real estate investment trust, including cash, promissory notes,
9-31 services performed for, contracts for services to be performed for,
9-32 or other securities of the real estate investment trust <operations
9-33 until the beneficial ownership is held by one hundred or more
9-34 persons with no five (5) persons owning more than fifty per cent
9-35 (50%) of the total number of outstanding shares of beneficial
9-36 interest. The word person as used herein shall not include
9-37 corporations>.
9-38 (9) <(11)> Any provision, not inconsistent with law,
9-39 including any provision which under this Act is permitted to be set
9-40 forth in the bylaws <by-laws>, which the trust manager(s) elect to
9-41 set forth in the declaration of trust for the regulation of the
9-42 internal affairs of the real estate investment trust.
9-43 (B) The declaration of trust shall be filed for record with
9-44 the County Clerk of the county of the principal place of business
9-45 of the real estate investment trust. The existence of the real
9-46 estate investment trust begins when the declaration of trust is
9-47 filed as required by this subsection.
9-48 (C) After the real estate investment trust has been formed,
9-49 an organizational meeting of the initial trust managers named in
9-50 the declaration of trust shall be held, at the call of a majority
9-51 of the trust manager(s) named in the declaration of trust, to adopt
9-52 bylaws, elect officers, and transact other business that may come
9-53 before the trust managers at the meeting. The trust managers who
9-54 call the meeting shall give each trust manager named in the
9-55 declaration of trust at least three days' notice of the meeting by
9-56 mail. The notice must state the time and place of the meeting.
9-57 Sec. 3.20. DEFENSE OF ULTRA VIRES. (A) Lack of capacity of
9-58 a real estate investment trust may never be the basis of a claim or
9-59 defense at law or in equity.
9-60 (B) An act of a real estate investment trust or a conveyance
9-61 or transfer of real or personal property to or by a real estate
9-62 investment trust may not be declared invalid because the act,
9-63 conveyance, or transfer was beyond the scope of the purpose or
9-64 purposes of the real estate investment trust as expressed in the
9-65 declaration of trust or because there are limitations expressed in
9-66 the declaration of trust on the authority of the officers and trust
9-67 manager(s) of the real estate investment trust to exercise any
9-68 statutory power of the real estate investment trust.
9-69 (C) The fact that an act, conveyance, or transfer was, or
9-70 is, beyond the scope of the purpose or purposes of the real estate
10-1 investment trust as expressed in its declaration of trust or
10-2 inconsistent with any expressed limitations of authority, may be
10-3 asserted:
10-4 (1) In a proceeding by a shareholder against the real
10-5 estate investment trust to enjoin an act or acts or the transfer of
10-6 real or personal property by or to the real estate investment
10-7 trust. If the unauthorized act or transfer sought to be enjoined
10-8 is being, or is to be, performed or made pursuant to any contract
10-9 to which the real estate investment trust is a party, the court may
10-10 set aside and enjoin the performance of the contract, if all of the
10-11 parties to the contract are parties to the proceeding and if the
10-12 court considers the action to be equitable. If the court sets
10-13 aside and enjoins the performance of the contract, the court may
10-14 allow compensation to the real estate investment trust or to the
10-15 other parties to the contract for the loss or damage sustained as a
10-16 result of the court's action. The court may not award anticipated
10-17 profits to be derived from the performance of the contract as a
10-18 part of loss or damage sustained.
10-19 (2) In a proceeding by the real estate investment
10-20 trust against the incumbent or former officers or trust manager(s)
10-21 of the real estate investment trust for exceeding their authority,
10-22 whether the real estate investment trust is acting directly or
10-23 through a receiver, trustee, or other legal representative, or
10-24 through shareholders in a representative suit.
10-25 Sec. 3.30 <3.1>. Classification of shares. (A) <Provisions
10-26 in declaration of trust.> A real estate investment trust may
10-27 provide by its declaration of trust:
10-28 (1) that any specified class of shares is preferred
10-29 over another class as to its distributive share of the assets on
10-30 voluntary or involuntary liquidation of the real estate investment
10-31 trust and the amount of the preference;
10-32 (2) that any specified class of shares may be redeemed
10-33 at the option of the real estate investment trust or of the holders
10-34 of the shares and the terms and conditions of redemption, including
10-35 the time and price of redemption;
10-36 (3) that any specified class of shares is convertible
10-37 into shares of one or more other classes and the terms and
10-38 conditions of conversion;
10-39 (4) that the holders of any specified securities
10-40 issued or to be issued by the real estate investment trust have any
10-41 voting or other rights which, by law, are or may be conferred on
10-42 shareholders;
10-43 (5) for any other preferences, rights, restrictions,
10-44 including restrictions on transferability, and qualifications not
10-45 inconsistent with law; provided, however, that no shareholder shall
10-46 have a preemptive right to acquire securities unless specifically
10-47 provided for in the declaration of trust; and
10-48 (6) that the trust manager(s) may classify or
10-49 reclassify any unissued shares from time to time by setting or
10-50 changing the preferences, conversion or other rights, voting
10-51 powers, restrictions, limitations as to dividends, qualifications,
10-52 or terms or conditions of redemption of the shares.
10-53 (B) <Statement of designation to be filed with county
10-54 clerk.> If, under a power contained in the declaration of trust,
10-55 the trust manager(s) classifies or reclassifies any unissued shares
10-56 by setting or changing the preferences, conversion or other rights,
10-57 voting powers, restrictions, limitations as to dividends,
10-58 qualifications, or terms or conditions of redemption, the trust
10-59 manager(s), before issuing any of the shares, shall file a
10-60 statement of designation for record with the county clerk of the
10-61 county of the principal place of business of the real estate
10-62 investment trust, which shall include:
10-63 (1) A description of the shares, including the
10-64 preferences, conversion and other rights, voting powers,
10-65 restrictions, limitations as to dividends, qualifications, and
10-66 terms and conditions of redemption, as set or changed by the trust
10-67 manager(s); and
10-68 (2) A statement that the shares have been classified
10-69 or reclassified by the trust manager(s) under the authority
10-70 contained in the declaration of trust.
11-1 <(C) Statements in certificates evidencing shares. If the
11-2 real estate investment trust has authority to issue shares of more
11-3 than one class, except as provided in Subsection (D) of this
11-4 Section, the certificate evidencing the shares shall contain on its
11-5 face or back a full statement or summary of:>
11-6 <(1) The designations and any preferences, conversion
11-7 and other rights, voting powers, restrictions, limitations as to
11-8 dividends, qualifications, and terms and conditions of redemption
11-9 of the shares of each class which the real estate investment trust
11-10 is authorized to issue; and>
11-11 <(2) If the real estate investment trust is authorized
11-12 to issue any preferred or special class in series:>
11-13 <(a) The differences in the relative rights and
11-14 preferences between the shares of each series to the extent they
11-15 have been set; and>
11-16 <(b) The authority of the trust manager(s) to
11-17 set the relative rights and preferences of subsequent series.>
11-18 <(D) Alternatives to full statement. (1) A summary of the
11-19 information required by Subsection (C) of this Section, as included
11-20 in a registration statement permitted to become effective under the
11-21 federal Securities Act of 1933, is an acceptable summary for the
11-22 purposes of this Section.>
11-23 <(2) Instead of a full statement or summary as
11-24 required by Subsection (C) of this Section, the certificate may
11-25 state that the real estate investment trust will furnish a full
11-26 statement of the information required by Subsection (C) of this
11-27 Section to any holder of shares without charge on written request
11-28 to the real estate investment trust at its principal place of
11-29 business or registered office.>
11-30 Sec. 4.10 <4>. Operation of real estate investment trust;
11-31 Trust Managers and Officers. (A) The control, operation,
11-32 disposition, investment, reinvestment and management of the trust
11-33 estate and, whether included in the foregoing or not, all powers
11-34 necessary or appropriate to effect any or all of the purposes for
11-35 which the real estate investment trust is organized shall be vested
11-36 in one or more <the> trust manager(s) named in the declaration of
11-37 trust or successor(s) selected in accordance therewith; provided
11-38 that naming successor trust manager(s) shall be considered an
11-39 amendment to the declaration of trust. Trust managers must be
11-40 natural persons but do not need to be residents of this state <At
11-41 least a majority of the trust managers must be natural persons and
11-42 residents of the State of Texas and the other trust manager(s), if
11-43 any, need not be residents of this state> or shareholders of the
11-44 real estate investment trust unless the declaration of trust or
11-45 bylaws <by-laws> so require. The declaration of trust or bylaws
11-46 <by-laws> may prescribe other qualifications for the trust
11-47 manager(s).
11-48 (B) The number of trust manager(s) shall be fixed by, or in
11-49 the manner provided in, the declaration of trust or the bylaws,
11-50 except for the number of initial trust manager(s), which shall be
11-51 fixed by the declaration of trust. The number of trust managers
11-52 may be increased or decreased from time to time by amendment to, or
11-53 in the manner provided in, the declaration of trust or the bylaws.
11-54 A decrease in the number of trust managers does not shorten the
11-55 term of any incumbent trust manager. Unless otherwise provided in
11-56 the declaration of trust or the bylaws, a trust manager shall serve
11-57 until the manager's successor has been elected by the requisite
11-58 vote. A trust manager may succeed himself or herself in office.
11-59 If no successor trust manager is elected, the existing trust
11-60 manager shall remain in office until the manager's successor is
11-61 elected.
11-62 (C) The bylaws of a real estate investment trust may provide
11-63 that the trust manager be divided into two or three classes, each
11-64 class to be as nearly equal in number as possible. The bylaws may
11-65 provide that the terms of office of trust managers of the first
11-66 class expire on the election of a successor at the first annual
11-67 meeting of shareholders after their election, that the terms of
11-68 office of trust managers of the second class expire on the election
11-69 of a successor at the second annual meeting after their election,
11-70 and that the terms of office of trust managers of the third class,
12-1 if any, expire on the election of a successor at the third annual
12-2 meeting after their election. If the bylaws provide for the
12-3 classification of trust managers, (1) an annual election for the
12-4 whole number of trust managers is not necessary, and (2) at each
12-5 annual meeting after the classification, the number of trust
12-6 managers equal to the number of the class whose terms expire at the
12-7 time of the meeting shall stand for election to office until the
12-8 second succeeding annual meeting, if there are two classes, or
12-9 until the third succeeding annual meeting, if there are three
12-10 classes. A classification of trust managers does not take effect
12-11 before the next annual meeting of shareholders at which trust
12-12 managers are elected unless the classification is effected by a
12-13 bylaw adopted by the shareholders. A classification of trust
12-14 managers is not effective for any real estate investment trust if
12-15 any shareholder has the right to cumulate his votes for the
12-16 election of trust managers of the real estate investment trust
12-17 unless there are nine or more trust managers.
12-18 (D) Any vacancy occurring in the trust managers may be
12-19 filled by the vote of a majority of the remaining trust managers,
12-20 though less than a quorum; provided, however, that the declaration
12-21 of trust or bylaws may provide an alternative procedure for filling
12-22 vacancies, including simple majority or super-majority votes of the
12-23 shareholders. A trust manager elected to fill a vacancy shall be
12-24 elected for the unexpired term of the trust manager's predecessor
12-25 in office, and until the trust manager's successor is elected and
12-26 qualified <or by the vote of two-thirds (2/3) of the outstanding
12-27 voting shares of the trust>.
12-28 (E) A <(C) If the trust is managed by three (3) or more
12-29 trust managers, a> majority of the number of trust managers shall
12-30 constitute a quorum for the transaction of business unless a
12-31 greater number is required by the declaration of trust or the
12-32 bylaws <by-laws>.
12-33 (F) <(D)> The trust manager(s) may designate one or more
12-34 persons, regardless of whether the persons are trust managers,
12-35 <such of its members> to constitute officers of the real estate
12-36 investment trust to the extent provided in the declaration of trust
12-37 or in the bylaws <by-laws> of the real estate investment trust, who
12-38 shall have and may exercise all of the authorities of the trust
12-39 manager(s) in the business and affairs of the real estate
12-40 investment trust except where action of the trust manager(s) is
12-41 specified by this Act or other applicable laws, but the designation
12-42 of such officers and the delegation thereto of authority shall not
12-43 operate to relieve the trust manager(s), or any member thereof, of
12-44 any responsibility imposed upon them or him by law. All officers
12-45 and agents of the real estate investment trust shall have such
12-46 authority and perform such duties in the management of the real
12-47 estate investment trust as may be provided in the bylaws <by-laws>
12-48 or as may be determined by the trust manager(s) not inconsistent
12-49 with the bylaws <by-laws>. Any officer or agent elected or
12-50 appointed by the trust manager(s) may be removed by the trust
12-51 manager(s) whenever in their judgment the best interests of the
12-52 real estate investment trust will be served thereby, but such
12-53 removal shall be without prejudice to the contract rights, if any,
12-54 of <if> the person <is> so removed. Election or appointment of an
12-55 officer or agent shall not of itself create contract rights.
12-56 (G) <(E)> The trust manager(s) or officers shall have the
12-57 power to exercise complete discretion with respect to the
12-58 investment of the trust estate so long as the investment is
12-59 <subject to the limitation that seventy-five per cent (75%) of the
12-60 total trust assets shall be invested in real property (including
12-61 fee ownership and co-ownership of land or improvements thereon and
12-62 leaseholds of land or improvements thereon), interests in mortgages
12-63 on real property, shares in other real estate investment trusts,
12-64 cash and cash items (including receivables) and Government
12-65 securities; provided that (i) the trust manager(s) or officers
12-66 shall not have the power to invest in severed mineral, oil or gas
12-67 royalty interests, and (ii) the trust manager(s) or officers may
12-68 invest any percentage of the trust estate in a subsidiary
12-69 corporation or entity, so long as such percentage ownership is> not
12-70 contrary to or inconsistent with this Section or with the sections
13-1 of the Internal Revenue Code of 1986 (or any successor statute)
13-2 which relate to or govern real estate investment trusts or the
13-3 regulations adopted under such sections.
13-4 (H) <(F)> The trust manager(s) and the officers of the real
13-5 estate investment trust shall receive such compensation as may be
13-6 fixed by, or in the manner provided in, the declaration of trust
13-7 or<,> the bylaws. If the declaration of trust or bylaws does not
13-8 contain a provision for compensation to the trust managers and
13-9 officers of the real estate investment trust, the compensation for
13-10 the trust managers and officers shall be determined by vote of the
13-11 trust managers <by-laws or as determined by majority vote of the
13-12 holders of all the outstanding shares>.
13-13 (I) <(G)> To the extent any provision of this Act is
13-14 contrary to or inconsistent with the sections of the Internal
13-15 Revenue Code of 1986 (or any successor statute) which relate to or
13-16 govern real estate investment trusts or the regulations adopted
13-17 under those sections, or requires any trust formed hereunder to
13-18 take (or prohibits any trust formed hereunder from taking) any
13-19 action required to secure or maintain its status as a real estate
13-20 investment trust under such sections or regulations, the sections
13-21 and regulations of the Internal Revenue Code of 1986 (or any
13-22 successor statute) shall prevail over the provisions of this Act as
13-23 to any real estate investment trust qualifying or attempting to
13-24 qualify under such sections and regulations.
13-25 Sec. 4.20. INTERESTED TRUST MANAGERS AND OFFICERS. (A) A
13-26 contract or transaction between a real estate investment trust and
13-27 one or more of the trust manager(s) or officers of the real estate
13-28 investment trust, or between a real estate investment trust and any
13-29 other real estate investment trust, corporation, partnership,
13-30 association, or other organization, is not void or voidable solely
13-31 because one or more of the trust manager(s) or officers of the real
13-32 estate investment trust are trust manager(s), directors, or
13-33 officers or have a financial interest in the other real estate
13-34 investment trust, corporation, partnership, association, or other
13-35 organization; solely because the trust manager or officer is
13-36 present at or participates in the meeting of the trust manager(s)
13-37 or committee of trust managers that authorizes the contract or
13-38 transaction; or solely because the trust manager's or officer's
13-39 votes are counted for the authorization if:
13-40 (1) The material facts as to the trust manager's or
13-41 officer's relationship or interest and as to the contract or
13-42 transaction are disclosed or are known to the trust manager(s) or
13-43 the committee, and the trust manager(s) or committee in good faith
13-44 authorizes the contract or transaction by the affirmative vote of a
13-45 majority of the disinterested trust manager(s), even though the
13-46 number of disinterested trust manager(s) is less than a quorum;
13-47 (2) The material facts as to the trust manager's or
13-48 officer's relationship or interest and as to the contract or
13-49 transaction are disclosed or are known to the shareholders entitled
13-50 to vote on the contract or transaction, and the contract or
13-51 transaction is specifically approved in good faith by vote of the
13-52 shareholders; or
13-53 (3) The contract or transaction is fair as to the real
13-54 estate investment trust as of the time the contract or transaction
13-55 is authorized, approved, or ratified by the trust manager(s), a
13-56 committee of trust managers, or the shareholders.
13-57 (B) Common or interested trust manager(s) may be counted in
13-58 determining the presence of a quorum at a meeting of the trust
13-59 manager(s) or of a committee of trust managers that authorizes the
13-60 contract or transaction.
13-61 Sec. 4.30. COMMITTEES OF THE TRUST MANAGERS. (A) If the
13-62 declaration of trust or the bylaws provide for the designation of
13-63 committees of trust managers, the trust manager(s), by resolution
13-64 adopted by a majority of the trust manager(s), may designate from
13-65 among the members of the trust managers one or more committees.
13-66 The committees must be composed of one or more of the members of
13-67 the trust managers. The trust managers may designate one or more
13-68 of their members as alternate members of any committee who, subject
13-69 to any limitations imposed by the trust manager(s), may replace
13-70 absent or disqualified members at any meeting of that committee.
14-1 To the extent provided in the resolution or in the declaration of
14-2 trust or the bylaws, a committee has and may exercise all of the
14-3 authority of the trust manager(s) subject to the limitations set
14-4 forth in Subsections (B) and (C) of this Section.
14-5 (B) A committee of trust manager(s) does not have the
14-6 authority of the trust manager(s) with regard to:
14-7 (1) amending the declaration of trust, except that a
14-8 committee, to the extent provided in the resolution designating
14-9 that committee or in the declaration of trust or the bylaws, may
14-10 exercise the authority of the trust manager(s) to classify or
14-11 reclassify shares in accordance with Section 3.30 of this Act;
14-12 (2) proposing a reduction of the stated capital of the
14-13 real estate investment trust;
14-14 (3) approving a plan of merger or share exchange of
14-15 the real estate investment trust;
14-16 (4) recommending to the shareholders the sale, lease,
14-17 or exchange of all or substantially all of the property and assets
14-18 of the real estate investment trust other than in the usual and
14-19 regular course of its business;
14-20 (5) recommending to the shareholders a voluntary
14-21 dissolution of the real estate investment trust or a revocation of
14-22 the trust;
14-23 (6) amending, altering, or repealing the bylaws or
14-24 adopting new bylaws of the real estate investment trust;
14-25 (7) filling vacancies in the trust manager(s);
14-26 (8) filling vacancies in or designating alternate
14-27 members of the committee;
14-28 (9) filling any trust manager vacancy occurring
14-29 because of an increase in the number of trust managers;
14-30 (10) electing or removing officers of the real estate
14-31 investment trust or members or alternate members of the committee;
14-32 (11) fixing the compensation of any member or
14-33 alternate members of the committee; or
14-34 (12) altering or repealing any resolution of the trust
14-35 manager(s) that by its terms provides that it may not be altered in
14-36 that manner or repealed.
14-37 (C) A committee of the trust manager(s) may not authorize a
14-38 distribution or the issuance of shares of the real estate
14-39 investment trust, unless the distribution or issuance is authorized
14-40 by the resolution designating that committee or the declaration of
14-41 trust or the bylaws.
14-42 (D) The designation of a committee of trust manager(s) and
14-43 the delegation to the committee of the trust managers' authority
14-44 does not relieve any trust manager of any responsibility imposed by
14-45 law.
14-46 Sec. 5.10 <5>. Registered Office and Registered Agent
14-47 <Service of Process on Real Estate Investment Trust>. (A) Each
14-48 real estate investment trust shall have and continuously maintain
14-49 in this state:
14-50 (1) a registered office that may be, but need not be,
14-51 the same as the principal office and place of business of the real
14-52 estate investment trust; and
14-53 (2) a registered agent that may be either:
14-54 (a) an individual resident in this state whose
14-55 business office is the same as the registered office of the real
14-56 estate investment trust; or
14-57 (b) a domestic corporation or real estate
14-58 investment trust or a foreign corporation authorized to transact
14-59 business in this state that has a business office that is the same
14-60 as the registered office of the real estate investment trust <The
14-61 resident trust manager(s) and any one of them if more than one and
14-62 any officer of the trust shall be an agent of such trust upon whom
14-63 any process, notice, or demand required or permitted by law to be
14-64 served upon the trust may be served>.
14-65 (B) A real estate investment trust may change its registered
14-66 office, its registered agent, or both, on filing with the county
14-67 clerk of the county where the declaration of trust was filed a
14-68 statement that is executed by an officer on behalf of the real
14-69 estate investment trust and that sets forth:
14-70 (1) The name of the real estate investment trust.
15-1 (2) The post-office address of the registered office
15-2 of the real estate investment trust.
15-3 (3) If the post-office address of the registered
15-4 office of the real estate investment trust is to be changed, the
15-5 post-office address to which the registered office is to be
15-6 changed.
15-7 (4) The name of the registered agent of the real
15-8 estate investment trust.
15-9 (5) If the registered agent of the real estate
15-10 investment trust is to be changed, the name of the successor
15-11 registered agent.
15-12 (6) A statement that the post-office address of the
15-13 registered office of the real estate investment trust or the
15-14 post-office address of the business office of the registered agent,
15-15 as changed, will be the same.
15-16 (7) A statement that the proposed change was
15-17 authorized by the trust managers of the real estate investment
15-18 trust or by an officer of the real estate investment trust who is
15-19 authorized by the trust managers to make a decision regarding the
15-20 proposed change.
15-21 (C) Any registered agent of a real estate investment trust
15-22 may resign:
15-23 (1) by giving written notice to the real estate
15-24 investment trust at the last known address of the real estate
15-25 investment trust; and
15-26 (2) by filing written notice with the county clerk of
15-27 the county where the declaration of trust was filed within 10 days
15-28 after the date on which the notice described by Subdivision (1) of
15-29 this Subsection was mailed or delivered to the real estate
15-30 investment trust.
15-31 (D) The notice described by Subsection (C)(2) of this
15-32 Section must include the last known address of the real estate
15-33 investment trust, a statement that written notice of resignation
15-34 has been given to the real estate investment trust, and the date of
15-35 the resignation.
15-36 (E) On complying with the notice requirements of Subsections
15-37 (C) and (D), the appointment of a registered agent who wants to
15-38 resign as agent terminates on the expiration of 30 days after the
15-39 date on which the notice is filed with the county clerk of the
15-40 county where the declaration of trust was filed.
15-41 (F) The address of the location of the registered office in
15-42 this state for a real estate investment trust may be changed to
15-43 another address on filing with the county clerk of the county where
15-44 the declaration of trust was filed a statement that is executed by
15-45 an officer on behalf of the real estate investment trust and that
15-46 sets forth:
15-47 (1) The name of the real estate investment trust and
15-48 the name of the trust's registered agent.
15-49 (2) The address at which the registered agent has
15-50 maintained the registered office for the real estate investment
15-51 trust.
15-52 (3) The new address at which the registered agent will
15-53 maintain the registered office for the real estate investment
15-54 trust.
15-55 (4) A statement that written notice of the change of
15-56 address has been given to the real estate investment trust at least
15-57 10 days before the filing of the statement required by this
15-58 Section.
15-59 Sec. 5.20. SERVICE OF PROCESS. (A) The president, all vice
15-60 presidents, and the registered agent of the real estate investment
15-61 trust are agents of the real estate investment trust on whom any
15-62 process, notice, or demand required or permitted by law to be
15-63 served on the real estate investment trust may be served.
15-64 (B) When a real estate investment trust fails to appoint or
15-65 maintain a registered agent in this state, or when the registered
15-66 agent of the real estate investment trust cannot with reasonable
15-67 diligence be found at the registered office, the Secretary of State
15-68 shall be an agent of the real estate investment trust on whom any
15-69 process, notice, or demand may be served. Service of any process,
15-70 notice, or demand on the Secretary of State shall be made by
16-1 delivering to and leaving with the Secretary of State, the
16-2 Assistant Secretary of State, or any clerk having charge of the
16-3 corporation department of the office of the Secretary of State,
16-4 duplicate copies of the process, notice, or demand. If any
16-5 process, notice, or demand is served on the Secretary of State
16-6 under this Section, the Secretary of State shall immediately
16-7 forward by registered mail one of the copies of the process,
16-8 notice, or demand to the real estate investment trust at its
16-9 registered office. Any service made on the Secretary of State
16-10 shall be returnable in not less than 30 days.
16-11 (C) The Secretary of State shall keep a record of all
16-12 processes, notices, and demands served on the Secretary of State
16-13 under this Section. The record must include the time of the
16-14 service and the action of the Secretary of State with regard to the
16-15 process, notice, or demand.
16-16 Sec. 6.10 <6>. General Powers of Real Estate Investment
16-17 Trust. (A) Subject to the provisions of paragraphs (B) and (C) of
16-18 this Section, each real estate investment trust shall have power:
16-19 (1) To have perpetual succession by its trust name
16-20 unless a limited period of duration is stated in its declaration of
16-21 trust.
16-22 (2) To sue and be sued, complain and defend, in its
16-23 trust name.
16-24 (3) To purchase, receive, lease, or otherwise acquire,
16-25 own, hold, improve, use and otherwise deal in and with, real or
16-26 personal property or any interest therein, wherever situated, as
16-27 the purposes of the real estate investment trust shall require<,
16-28 but the trust shall not own more than one thousand (1,000) acres
16-29 outside the corporate limits of a town or city at any one time>.
16-30 (4) To sell, convey, mortgage, pledge, lease,
16-31 exchange, transfer and otherwise dispose of all or any part of its
16-32 property and assets.
16-33 (5) To lend money to, and otherwise assist, the
16-34 employees, officers, and trust managers of the real estate
16-35 investment trust if the loan or assistance may reasonably be
16-36 expected to benefit, directly or indirectly, the lending or
16-37 assisting real estate investment trust.
16-38 (6) <(5)> To purchase, receive, subscribe for, or
16-39 otherwise acquire, own, hold, vote, use, employ, mortgage, lend,
16-40 pledge, sell or otherwise dispose of, and otherwise use and deal in
16-41 and with, securities, shares or other interests in, or obligations
16-42 of, domestic or foreign corporations, associations, partnerships,
16-43 other real estate investment trusts, or individuals, or direct or
16-44 indirect obligations of the United States or of any other
16-45 government, state, territory, government district, or municipality,
16-46 or of any instrumentality thereof.
16-47 (7) To purchase or otherwise acquire its own bonds,
16-48 debentures, or other evidences of its indebtedness or obligations;
16-49 to purchase or otherwise acquire its own unredeemable shares and
16-50 hold those acquired shares as treasury shares or cancel or
16-51 otherwise dispose of those acquired shares; and to redeem or
16-52 purchase shares made redeemable by the provisions of its
16-53 declaration of trust.
16-54 (8) <(6)> To make contracts, and incur liabilities,
16-55 borrow money at such rates of interest as the trust may determine,
16-56 issue its notes, bonds, and other obligations, and secure any of
16-57 its obligations by mortgage or pledge of all or any of its
16-58 property, franchises, and income.
16-59 (9) <(7)> To lend money for its trust purposes, invest
16-60 and reinvest its funds, and take and hold real and personal
16-61 property as security for the payment of funds so loaned or
16-62 invested.
16-63 (10) <(8)> To conduct its business, carry on its
16-64 operations, and have offices and exercise the powers granted by
16-65 this Act in any state, territory, district or possession of the
16-66 United States, or in any foreign country.
16-67 (11) <(9)> To elect or appoint officers and agents of
16-68 the trust for such period of time as the real estate investment
16-69 trust may determine, and define their duties and fix their
16-70 compensation.
17-1 (12) <(10)> To make and alter bylaws <by-laws>, not
17-2 inconsistent with its declaration of trust or with the laws of this
17-3 state, for the administration and regulation of the affairs of the
17-4 real estate investment trust.
17-5 (13) To make donations for the public welfare or for
17-6 charitable, scientific, or educational purposes.
17-7 (14) To transact any lawful business that the trust
17-8 managers find will aid government policy.
17-9 (15) To indemnify trust managers, officers, employees,
17-10 and agents of the real estate investment trust and to purchase and
17-11 maintain liability insurance for those persons.
17-12 (16) To pay pensions and establish pension plans,
17-13 pension trusts, profit sharing plans, stock option plans, stock
17-14 bonus plans, and other incentive plans for any or all of, or any
17-15 class or classes of, its trust managers, officers or employees.
17-16 (17) To be an organizer, partner, member, associate,
17-17 or manager of any partnership, joint venture, or other enterprise,
17-18 and to the extent permitted in any other jurisdiction, to be an
17-19 incorporator of any other corporation of any type or kind.
17-20 (18) <(11)> To cease its trust activities and
17-21 terminate its existence by voluntary dissolution.
17-22 (19) To engage in activities that are mandated or
17-23 authorized by sections of the Internal Revenue Code of 1986 that
17-24 relate to or govern real estate investment trusts or the
17-25 regulations adopted under that law.
17-26 (20) <(12)> Whether included in the foregoing or not,
17-27 to have and exercise, all powers necessary or appropriate to effect
17-28 any or all of the purposes for which the real estate investment
17-29 trust is organized.
17-30 (B) Nothing in this Section grants any authority to officers
17-31 or trust manager(s) of a real estate investment trust to perform
17-32 any of the foregoing powers inconsistent with the limitations on
17-33 any of the same which may be expressly set forth in this Act or in
17-34 the declaration of trust or in any other laws of this state.
17-35 Authority of officers and trust manager(s) to act beyond the scope
17-36 of the purpose or purposes of a real estate investment trust is not
17-37 granted by any provision of this Section.
17-38 (C) Nothing contained in this Act shall be deemed to
17-39 authorize any action in violation of the antitrust laws <Anti-Trust
17-40 Laws> of this state as now existing or hereafter amended.
17-41 Sec. 7.10. SUBSCRIPTION FOR SHARES. (A) Unless otherwise
17-42 provided in the subscription, a subscription for shares of a real
17-43 estate investment trust to be organized may not be revoked within
17-44 six months, except with the consent of all other subscribers.
17-45 (B) In the case of a real estate investment trust to be
17-46 organized, the filing of the declaration of trust with the county
17-47 clerk of the county of the principal place of business of the real
17-48 estate investment trust constitutes acceptance by the real estate
17-49 investment trust of all subscriptions for shares that are contained
17-50 in a list of subscriptions filed with the declaration of trust.
17-51 The list of subscriptions shall contain the name, post-office
17-52 address, number of shares, and amount paid by each subscriber.
17-53 Failure to include a subscription for shares in the list of
17-54 subscriptions constitutes a rejection of the offer.
17-55 (C) In the case of an existing real estate investment trust,
17-56 acceptance of a subscription for shares is effected by a resolution
17-57 of acceptance by the trust manager(s) or by a written memorandum of
17-58 acceptance of the subscription for shares executed by a person
17-59 authorized to execute the memorandum by the trust manager(s) and
17-60 delivered to the subscriber or the subscriber's assignee.
17-61 (D) Subscriptions for shares, whether made before or after
17-62 the organization of a real estate investment trust, shall be paid
17-63 in full at a time determined by the trust manager(s) or in
17-64 installments and at times determined by the trust manager(s). Any
17-65 call made by the trust manager(s) for payment on subscriptions must
17-66 be uniform for all shares of the same class or all shares of the
17-67 same series, as the case may be. In case of default in the payment
17-68 of any installment or call when the payment is due, the real estate
17-69 investment trust may proceed to collect the amount due in the same
17-70 manner as the real estate investment trust would collect any debt
18-1 due the real estate investment trust. The bylaws may prescribe
18-2 other penalties for failure to pay installments or calls that may
18-3 become due, but a penalty working a forfeiture of a subscription,
18-4 or of the amounts paid on the subscription, may not be declared
18-5 against any subscriber unless the amount due on the subscription
18-6 remains unpaid on the 21st day after the day on which written
18-7 demand is made for payment. If mailed, the written demand is
18-8 considered to be made when deposited in the United States mail in a
18-9 sealed envelope, with prepaid postage, addressed to the subscriber
18-10 at the subscriber's last post-office address known to the real
18-11 estate investment trust. If the demand remains unsatisfied for the
18-12 20-day period, and if the real estate investment trust is solvent,
18-13 the real estate investment trust may declare the subscription to be
18-14 forfeited. The effect of the declaration of forfeiture is to
18-15 terminate all the rights and obligations of the subscriber as a
18-16 subscriber of shares.
18-17 Sec. 7.20. CERTIFICATES REPRESENTING SHARES. (A) A real
18-18 estate investment trust shall deliver certificates representing
18-19 shares to which shareholders are entitled, or the shares of a real
18-20 estate investment trust may be uncertificated shares. Unless
18-21 otherwise provided by the declaration of trust or bylaws, the trust
18-22 manager(s) of a real estate investment trust by resolution may
18-23 provide that some or all of any or all classes and series of its
18-24 shares shall be uncertificated shares; provided, that the
18-25 resolution may not apply to shares represented by a certificate
18-26 until the certificate is surrendered to the real estate investment
18-27 trust. Certificates representing shares shall be signed by the
18-28 officer or officers prescribed by the bylaws of the real estate
18-29 investment trust to sign the shares, and may be sealed with the
18-30 seal of the real estate investment trust, if any, or a facsimile of
18-31 the seal. The signatures of the officer or officers on a
18-32 certificate may be facsimiles. If an officer who has signed or
18-33 whose facsimile signature has been placed on the certificate ceases
18-34 to serve as officer before the certificate is issued, the real
18-35 estate investment trust may issue the certificate, and the
18-36 certificate has the same effect as if that officer were serving as
18-37 officer on the date of the certificate's issuance.
18-38 (B) If a real estate investment trust is authorized to issue
18-39 shares of more than one class or series, each certificate
18-40 representing shares issued by the real estate investment trust
18-41 shall conspicuously:
18-42 (1) set forth on the face or back of the certificate a
18-43 full statement of all the designations, preferences, limitations,
18-44 and relative rights of the shares of each class or series to the
18-45 extent they have been fixed and determined and the authority of the
18-46 trust manager(s) to fix and determine the designations,
18-47 preferences, limitations, and relative rights of subsequent series;
18-48 or
18-49 (2) state on the face or back of the certificate that:
18-50 (a) a statement that contains the information
18-51 required in Subdivision (1) of this Subsection is set forth in the
18-52 declaration of trust on file with the county clerk of the county of
18-53 the principal place of business of the real estate investment
18-54 trust; and
18-55 (b) the real estate investment trust, on written
18-56 request to the real estate investment trust at its principal place
18-57 of business or registered office, will furnish a copy of the
18-58 statement to the record holder of the certificate without charge.
18-59 (C) Each certificate representing shares shall state on the
18-60 face of the certificate:
18-61 (1) That the real estate investment trust is organized
18-62 under the laws of this state.
18-63 (2) The name of the person to whom the certificate was
18-64 issued.
18-65 (3) The number and class of shares and the designation
18-66 of the series, if any, that the certificate represents.
18-67 (4) The par value of each share represented by the
18-68 certificate, or a statement that the shares are without par value.
18-69 (D) In accordance with Chapter 8, Business & Commerce Code,
18-70 a real estate investment trust, after the issuance or transfer of
19-1 uncertificated shares, shall send to the registered owner of
19-2 uncertificated shares a written notice containing the information
19-3 required to be set forth or stated on certificates under this Act.
19-4 Except as otherwise expressly provided by law, the rights and
19-5 obligations of the holders of uncertificated shares and the rights
19-6 and obligations of the holders of certificates representing shares
19-7 of the same class and series must be identical. A share may not be
19-8 issued until the consideration for the shares, fixed as provided by
19-9 law, has been fully paid.
19-10 (E) A requirement of this Act regarding matters to be set
19-11 forth on certificates representing shares of a real estate
19-12 investment trust may not apply to or affect certificates
19-13 outstanding when the requirement first becomes applicable to the
19-14 certificates, but the requirement shall apply to all certificates
19-15 issued after the requirement becomes applicable whether the
19-16 requirement relates to an original issue of shares, a transfer of
19-17 shares, or otherwise.
19-18 (F) If any restriction on the transfer or registration of
19-19 the transfer of shares is imposed or agreed to by the real estate
19-20 investment trust, as permitted by this Act, each certificate
19-21 representing shares restricted in this manner:
19-22 (1) shall conspicuously set forth a full or summary
19-23 statement of the restriction on the face of the certificate;
19-24 (2) shall set forth the statement on the back of the
19-25 certificate and conspicuously refer to the statement on the face of
19-26 the certificate; or
19-27 (3) shall conspicuously state on the face or back of
19-28 the certificate that such a restriction exists pursuant to a
19-29 specified document and:
19-30 (a) that the real estate investment trust, on
19-31 written request to the real estate investment trust at its
19-32 principal place of business, shall furnish to the record holder of
19-33 the certificate a copy of the specific document without charge; or
19-34 (b) if the document is one required or permitted
19-35 to be and has been filed under this Act, that the specified
19-36 document is on file with the county clerk of the county of the
19-37 principal place of business of the real estate investment trust and
19-38 contains a full statement of the restriction.
19-39 (G) Unless the document described by Subdivision (3) of
19-40 Subsection (F) of this Section was on file with the county clerk of
19-41 the county of the principal place of business of the real estate
19-42 investment trust at the time of the request, a real estate
19-43 investment trust that fails within a reasonable time to furnish
19-44 without charge to a record holder of a certificate who requested a
19-45 copy of the specified document may not be permitted to enforce its
19-46 rights under the restriction imposed on the shares represented by
19-47 the certificate.
19-48 (H) If a real estate investment trust has by its declaration
19-49 of trust provided for a preemptive right of shareholders to acquire
19-50 unissued securities of the real estate investment trust, each
19-51 certificate representing shares issued by the real estate
19-52 investment trust shall conspicuously set forth on the face or back
19-53 of the certificate a full statement of the existence of preemptive
19-54 rights.
19-55 Sec. 7.30 <7>. Consideration and Payment for Shares.
19-56 (A) Shares may be issued for such consideration <expressed in
19-57 dollars> as shall be fixed from time to time by the trust
19-58 manager(s). If the shares have a par value, the consideration for
19-59 the shares may not be less than the par value.
19-60 (B) The consideration paid for the issuance of shares shall
19-61 consist of any tangible or intangible benefit to the real estate
19-62 investment trust, including cash, promissory notes, services
19-63 performed for, contracts for services to be performed for, or other
19-64 securities of the real estate investment trust <money paid or
19-65 property actually received>. Shares may not be issued until the
19-66 full amount of the consideration has been paid. When such
19-67 consideration shall have been paid to the real estate investment
19-68 trust or to another entity of which all of the outstanding shares
19-69 of each class of capital stock are owned, directly or indirectly,
19-70 by the real estate investment trust, the shares shall be deemed to
20-1 have been issued, and the shareholder entitled to receive such
20-2 issue, shall be a shareholder with respect to such shares, and the
20-3 shares shall be considered fully paid and non-assessable.
20-4 (C) <Neither promissory notes nor the promise of future
20-5 services, nor past services shall constitute payment or part
20-6 payment for shares of a real estate investment trust.>
20-7 <(D)> In the absence of fraud in the transaction, the
20-8 judgment of the trust manager(s) or the shareholders, as the case
20-9 may be, as to the value of the consideration received for shares
20-10 shall be conclusive.
20-11 Sec. 7.40. TRANSFER OF SHARES AND OTHER SECURITIES AND
20-12 RESTRICTIONS ON TRANSFER. (A) Except as otherwise provided in
20-13 this Act, the shares and other securities of a real estate
20-14 investment trust are personal property for all purposes and are
20-15 transferable in accordance with Chapter 8, Business & Commerce
20-16 Code.
20-17 (B) A restriction on the transfer or registration of
20-18 transfer of a security may be imposed by the declaration of trust
20-19 or bylaws, or by a written agreement among any number of the
20-20 holders of the securities or a written agreement among any number
20-21 of the holders and the real estate investment trust, provided the
20-22 real estate investment trust places on file a counterpart of the
20-23 agreement at its principal place of business or its registered
20-24 office. The counterpart of the agreement shall be subject to the
20-25 same right of examination by a shareholder of the real estate
20-26 investment trust, in person or by agent, attorney, or accountant,
20-27 as are the books and records of the real estate investment trust.
20-28 A restriction on the transfer or registration of transfer of a
20-29 security imposed as described by this Subsection is not valid with
20-30 respect to any security issued before the adoption of the
20-31 restriction unless the holder of the security voted in favor of the
20-32 restriction or is a party to the agreement imposing the
20-33 restriction.
20-34 (C) Any restriction on the transfer or registration of
20-35 transfer of a security of a real estate investment trust shall be
20-36 specifically enforceable against the holder of the restricted
20-37 security or any successor or transferee of the holder if the
20-38 restriction is:
20-39 (1) reasonable and noted conspicuously on the
20-40 certificate or other instrument representing the security; or
20-41 (2) in the case of an uncertificated security,
20-42 reasonable and notation of the restriction is contained in the
20-43 notice sent pursuant to Subsection (D) of Section 7.20 of this Act
20-44 with respect to the security.
20-45 (D) A restriction, even though otherwise enforceable, is
20-46 ineffective against a transferee for value without actual knowledge
20-47 of the restriction at the time of the transfer or against any
20-48 subsequent transferee (whether or not for value), unless the
20-49 restriction is noted conspicuously on the certificate or other
20-50 instrument representing the security or, in the case of an
20-51 uncertificated security, notation of the restriction is contained
20-52 in the notice sent pursuant to Subsection (D) of Section 7.20 of
20-53 this Act with respect to the security. The restriction shall be
20-54 specifically enforceable against any other person who is not a
20-55 transferee for value from and after the time that the person
20-56 acquires actual knowledge of the existence of the restriction.
20-57 (E) In particular and without limiting the general power
20-58 granted in Subsections (B), (C), and (D) of this Section to impose
20-59 reasonable restrictions, a restriction on the transfer or
20-60 registration of transfer of securities of a real estate investment
20-61 trust is valid if it reasonably:
20-62 (1) obligates the holders of the restricted securities
20-63 to offer to the real estate investment trust or to any other
20-64 holders of securities of the real estate investment trust or to any
20-65 other person, or to any combination of those persons, a prior
20-66 opportunity, to be exercised within a reasonable time, to acquire
20-67 the restricted securities;
20-68 (2) obligates the real estate investment trust, to the
20-69 extent permitted by this Act, or any holder of securities of the
20-70 real estate investment trust or any other person, or any
21-1 combination of those persons, to purchase the securities that are
21-2 the subject of an agreement regarding the purchase and sale of the
21-3 restricted securities;
21-4 (3) requires the real estate investment trust or the
21-5 holders of any class of securities of the real estate investment
21-6 trust to consent to any proposed transfer of the restricted
21-7 securities or to approve the proposed transferee of the restricted
21-8 securities for the purpose of preventing violations of federal or
21-9 state laws;
21-10 (4) prohibits the transfer of the restricted
21-11 securities to designated persons or classes of persons, and the
21-12 designation is not manifestly unreasonable; or
21-13 (5) maintains any tax advantage to the real estate
21-14 investment trust, including maintaining its status as a real estate
21-15 investment trust under the applicable provisions of the Internal
21-16 Revenue Code of 1986 or the regulations adopted under that law.
21-17 (F) A real estate investment trust that has adopted a bylaw,
21-18 or is a party to an agreement restricting the transfer of its
21-19 shares or other securities, may file the bylaw or agreement as a
21-20 matter of public record with the county clerk of the county of the
21-21 principal place of business of the real estate investment trust, as
21-22 follows:
21-23 (1) The real estate investment trust shall file a copy
21-24 of the bylaw or agreement with the county clerk and a statement
21-25 attached to the copy setting forth:
21-26 (a) the name of the real estate investment
21-27 trust;
21-28 (b) that the copy of the bylaw or agreement is a
21-29 true and correct copy of the bylaw or agreement; and
21-30 (c) that the filing has been duly authorized by
21-31 the trust manager(s) or the shareholders, as the case may be.
21-32 (2) The statement shall be executed by an officer on
21-33 behalf of the real estate investment trust.
21-34 (3) After the filing of the statement with the county
21-35 clerk, the bylaw or agreement restricting the transfer of shares or
21-36 other securities becomes a matter of public record and the fact of
21-37 the filing of the bylaw or agreement shall be stated on any
21-38 certificate representing the shares or other securities restricted
21-39 by the bylaw or agreement if required by Subsection (F) of Section
21-40 7.20 of this Act.
21-41 (G) By complying with the provisions of this Act or amending
21-42 the declaration of trust, a real estate investment trust that is a
21-43 party to an agreement restricting the transfer of its shares or
21-44 other securities may make that agreement part of its declaration of
21-45 trust without restating the provisions of the agreement in the
21-46 declaration of trust. If the agreement alters any provision of the
21-47 original or amended declaration of trust, the articles of amendment
21-48 must identify the altered provision by reference or description.
21-49 If the agreement is to be an addition to the original or amended
21-50 declaration of trust, the articles of amendment shall state that
21-51 fact. A copy of the agreement restricting the transfer of shares
21-52 or other securities must be attached to the articles of amendment.
21-53 The articles of amendment shall state that the attached copy of the
21-54 agreement is a true and correct copy of the agreement and that its
21-55 inclusion as part of the declaration of trust has been duly
21-56 authorized in the manner required by this Act to amend the
21-57 declaration of trust.
21-58 (H) When shares are registered on the books of a real estate
21-59 investment trust in the names of two or more persons as joint
21-60 owners with the right of survivorship, after the death of a joint
21-61 owner and before the time that the real estate investment trust
21-62 receives actual written notice that parties other than the
21-63 surviving joint owner or owners claim an interest in the shares of
21-64 or any distributions from the real estate investment trust, the
21-65 real estate investment trust may record on its books and otherwise
21-66 effect the transfer of those shares to any person, firm, or entity
21-67 (including that surviving joint owner individually) and may pay any
21-68 distributions made in respect of those shares, in each case as if
21-69 the surviving joint owner or owners were the absolute owners of the
21-70 shares. A real estate investment trust permitting such a transfer
22-1 by and making any distribution to a surviving joint owner or owners
22-2 before the receipt of written notice from other parties claiming an
22-3 interest in those shares or distributions is discharged from all
22-4 liability for the transfer or payment so made; provided, however,
22-5 that the discharge of the real estate investment trust from
22-6 liability and the transfer of full legal and equitable title of the
22-7 shares does not affect, reduce, or limit any cause of action
22-8 existing in favor of any owner of an interest in those shares or
22-9 distributions against the surviving owner or owners.
22-10 Sec. 8.10 <8>. LIABILITY OF SUBSCRIBERS AND SHAREHOLDERS.
22-11 (A) A holder of shares, an owner of any beneficial interest in
22-12 shares, or a subscriber for shares whose subscription has been
22-13 accepted is not under an obligation to the real estate investment
22-14 trust or to its obligees with respect to:
22-15 (1) the shares other than the obligation to pay to the
22-16 real estate investment trust the full amount of the consideration,
22-17 fixed in compliance with Section 7.30 of this Act, for which the
22-18 shares were or are to be issued;
22-19 (2) any contractual obligation of the real estate
22-20 investment trust on the basis that the holder, owner, or subscriber
22-21 is or was the alter ego of the real estate investment trust, or on
22-22 the basis of actual fraud or constructive fraud, a sham to
22-23 perpetrate a fraud, or other similar theory, unless the obligee
22-24 demonstrates that the holder, owner, or subscriber caused the real
22-25 estate investment trust to be used for the purpose of perpetrating
22-26 and did perpetrate an actual fraud on the obligee primarily for the
22-27 direct personal benefit of the holder, owner, or subscriber; or
22-28 (3) any obligation of the real estate investment trust
22-29 on the basis of the failure of the real estate investment trust to
22-30 observe any formality, including the failure to:
22-31 (a) comply with any requirement of this Act or
22-32 of the declaration of trust or bylaws of the real estate investment
22-33 trust; or
22-34 (b) observe any requirement prescribed by this
22-35 Act or by the declaration of trust or bylaws for acts taken by the
22-36 real estate investment trust, its trust manager(s), or its
22-37 shareholders.
22-38 (B) The liability of a holder, owner, or subscriber of
22-39 shares of a real estate investment trust for an obligation that is
22-40 limited by Subsection (A) of this Section is exclusive and preempts
22-41 any other liability imposed on a holder, owner, or subscriber of
22-42 shares of a real estate investment trust for that obligation under
22-43 common law or otherwise, except that this Section does not limit
22-44 the obligation of a holder, owner, or subscriber to an obligee of
22-45 the real estate investment trust when:
22-46 (1) the holder, owner, or subscriber has expressly
22-47 assumed, guaranteed, or agreed to be personally liable to the
22-48 obligee for the obligation; or
22-49 (2) the holder, owner, or subscriber is otherwise
22-50 liable to the obligee for the obligation under this Act or another
22-51 applicable statute <A holder of a certificate of shares shall not
22-52 be personally or individually liable in any manner whatsoever for
22-53 any debt, act, omission or obligation incurred by the trust or the
22-54 trust manager(s) and shall be under no obligation to the trust or
22-55 to its creditors with respect to such shares other than the
22-56 obligation to pay to the trust the full amount of the consideration
22-57 for which such shares were issued or to be issued>.
22-58 (C) <(B)> Any person becoming an assignee or transferee of
22-59 certificated shares or of uncertificated shares or of a
22-60 subscription for <a certificate of> shares in good faith and
22-61 without knowledge or notice that the full consideration therefor
22-62 has not been paid to the real estate investment trust shall not be
22-63 personally liable to the real estate investment trust or its
22-64 creditors for any unpaid portion of such consideration.
22-65 (D) <(C)> An executor, administrator, conservator, guardian,
22-66 trustee, assignee for the benefit of creditors, or receiver, shall
22-67 not be liable personally as a holder of shares of a real estate
22-68 investment trust, but the estate and funds in his hands shall be
22-69 liable to pay to the real estate investment trust the full amount
22-70 of the consideration for which such shares were issued or to be
23-1 issued.
23-2 (E) <(D)> No pledgee or other holder of shares as collateral
23-3 security shall be personally liable as a shareholder.
23-4 <(E) No real estate investment trust may impose restrictions
23-5 on the sale or other disposition of its shares and on the transfer
23-6 thereof.>
23-7 Sec. 9.10 <9>. BYLAWS <By-laws>. (A) The initial bylaws
23-8 <by-laws> of the real estate investment trust shall be adopted by
23-9 the trust manager(s) <or the shareholders>. The bylaws <by-laws>
23-10 may contain any provisions for the regulation and management of the
23-11 affairs of the real estate investment trust not inconsistent with
23-12 law or the declaration of trust.
23-13 (B) The trust manager(s) of a real estate investment trust
23-14 may amend or repeal the real estate investment trust's bylaws
23-15 <by-laws>, or adopt new bylaws <by-laws>, unless:
23-16 (1) the declaration of trust or this Act reserves the
23-17 power exclusively to the shareholders in whole or part; or
23-18 (2) the shareholders in amending, repealing, or
23-19 adopting a particular bylaw provision <by-law> expressly provide
23-20 that the trust manager(s) may not amend or repeal that bylaw
23-21 <by-law>.
23-22 (C) Unless the declaration of trust or a bylaw <by-law>
23-23 adopted by the shareholders provides otherwise as to all or some
23-24 portion of a real estate investment trust's bylaws <by-laws>, a
23-25 real estate investment trust's shareholders may amend, repeal, or
23-26 adopt the real estate investment trust's bylaws <by-laws> even
23-27 though the bylaws <by-laws> may also be amended, repealed, or
23-28 adopted by its trust manager(s).
23-29 Sec. 9.20 <9.1>. Indemnification. (A) In this Section:
23-30 (1) "Trust Manager" means any person who is or was a
23-31 trust manager of the real estate investment trust and any person
23-32 who, while a trust manager of the real estate investment trust, is
23-33 or was serving, at the request of the real estate investment trust
23-34 as a trust manager, director, officer, partner, venturer,
23-35 proprietor, trustee, employee, agent, or similar functionary of
23-36 another real estate investment trust, foreign or domestic
23-37 corporation, partnership, joint venture, sole proprietorship,
23-38 trust, employee benefit plan, or other enterprise.
23-39 (2) "Expenses" include court costs and attorney's
23-40 fees.
23-41 (3) "Official capacity":
23-42 (a) when used with respect to a trust manager,
23-43 means the office of trust manager in the real estate investment
23-44 trust; and
23-45 (b) when used with respect to a person other
23-46 than a trust manager, means the elective or appointive office in
23-47 the real estate investment trust held by the officer or the
23-48 employment or agency relationship undertaken by the employee or
23-49 agent in behalf of the real estate investment trust; but
23-50 (c) in both paragraphs (a) and (b) does not
23-51 include service for any other real estate investment trust or
23-52 foreign or domestic corporation or any partnership, joint venture,
23-53 sole proprietorship, trust, employee benefit plan, or other
23-54 enterprise.
23-55 (4) "Proceeding" means any threatened, pending, or
23-56 completed action, suit, or proceeding, whether civil, criminal,
23-57 administrative, arbitrative, or investigative, any appeal in such
23-58 an action, suit, or proceeding, and any inquiry or investigation
23-59 that could lead to such an action, suit, or proceeding.
23-60 (5) "Real estate investment trust" includes any
23-61 domestic or foreign predecessor of the real estate investment trust
23-62 in a merger, consolidation, or other transaction in which the
23-63 liabilities of the predecessor are transferred to the real estate
23-64 investment trust by operation of law and in any other transaction
23-65 in which the real estate investment trust assumes the liabilities
23-66 of the predecessor but does not specifically exclude liabilities
23-67 that are the subject matter of this Section.
23-68 (B) A real estate investment trust may indemnify a person
23-69 who was, is, or is threatened to be made a named defendant or
23-70 respondent in a proceeding because the person is or was a trust
24-1 manager only if it is determined in accordance with Subsection (F)
24-2 of this Section that the person:
24-3 (1) conducted himself in good faith;
24-4 (2) reasonably believed:
24-5 (a) in the case of conduct in his official
24-6 capacity as a trust manager of the real estate investment trust,
24-7 that his conduct was in the real estate investment trust's best
24-8 interests; and
24-9 (b) in all other cases that his conduct was at
24-10 least not opposed to the real estate investment trust's best
24-11 interests; and
24-12 (3) in the case of any criminal proceeding, had no
24-13 reasonable cause to believe that his conduct was unlawful.
24-14 (C) Except to the extent permitted by Subsection (E) of this
24-15 Section, a trust manager may not be indemnified under Subsection
24-16 (B) of this Section in respect of a proceeding:
24-17 (1) in which the person is found liable on the basis
24-18 that personal benefit was improperly received by him, whether or
24-19 not the benefit resulted from an action taken in the person's
24-20 official capacity; or
24-21 (2) in which the person is found liable to the real
24-22 estate investment trust.
24-23 (D) The termination of a proceeding by judgment, order,
24-24 settlement, or conviction, or on a plea of nolo contendere or its
24-25 equivalent is not of itself determinative that the person did not
24-26 meet the requirements set forth in Subsection (B) of this Section.
24-27 A person shall be deemed to have been found liable in respect of
24-28 any claim, issue, or matter only after the person shall have been
24-29 so adjudged by a court of competent jurisdiction after exhaustion
24-30 of all appeals therefrom.
24-31 (E) A person may be indemnified under Subsection (B) of this
24-32 Section against judgments, penalties (including excise and similar
24-33 taxes), fines, settlements, and reasonable expenses actually
24-34 incurred by the person in connection with the proceeding; but if
24-35 the person is found liable to the real estate investment trust or
24-36 is found liable on the basis that personal benefit was improperly
24-37 received by the person, the indemnification (1) is limited to
24-38 reasonable expenses actually incurred by the person in connection
24-39 with the proceeding, and (2) shall not be made in respect of any
24-40 proceeding in which the person shall have been found liable for
24-41 wilful or intentional misconduct in the performance of his duty to
24-42 the real estate investment trust.
24-43 (F) A determination to furnish indemnification under
24-44 Subsection (B) of this Section shall be made only:
24-45 (1) by a majority vote of a quorum consisting of trust
24-46 managers who at the time of the vote are not named defendants or
24-47 respondents in the proceeding;
24-48 (2) if such a quorum cannot be obtained, by a majority
24-49 vote of a committee of the trust managers, designated to act in the
24-50 matter by a majority vote of all trust managers, consisting solely
24-51 of two or more trust managers who at the time of the vote are not
24-52 named defendants or respondents in the proceeding;
24-53 (3) by special legal counsel selected by the trust
24-54 managers or a committee thereof by vote as set forth in Subdivision
24-55 (1) or (2) of this Subsection, or, if such a quorum cannot be
24-56 obtained and such a committee cannot be established, by a majority
24-57 vote of all trust managers; or
24-58 (4) by the shareholders in a vote that excludes the
24-59 shares of beneficial interest held by trust managers who are named
24-60 defendants or respondents in the proceeding.
24-61 (G) Authorization of indemnification and determination as to
24-62 reasonableness of expenses must be made in the same manner as the
24-63 determination that indemnification is permissible, except that if
24-64 the determination that indemnification is permissible is made by
24-65 special legal counsel, authorization of indemnification and
24-66 determination as to reasonableness of expenses must be made in the
24-67 manner specified by Subdivision (3) of Subsection (F) of this
24-68 Section for the selection of special legal counsel. A provision
24-69 contained in the declaration of trust, the bylaws <by-laws>, or an
24-70 agreement that makes mandatory the indemnification permitted under
25-1 Subsection (B) of this Section shall be deemed to constitute
25-2 authorization of indemnification in the manner required by this
25-3 Subsection <paragraph> even though such provision may not have been
25-4 adopted or authorized in the same manner as the determination that
25-5 indemnification is permissible.
25-6 (H) A real estate investment trust shall indemnify a trust
25-7 manager against reasonable expenses incurred by him in connection
25-8 with a proceeding in which he is a named defendant or respondent
25-9 because he is or was a trust manager if he has been wholly
25-10 successful, on the merits or otherwise, in the defense of the
25-11 proceeding.
25-12 (I) If, in a suit for the indemnification required by
25-13 Subsection (H) of this Section, a court of competent jurisdiction
25-14 determines that the trust manager is entitled to indemnification
25-15 under that Subsection, the court shall order indemnification and
25-16 shall award to the trust manager the expenses incurred in securing
25-17 the indemnification.
25-18 (J) If, upon application of a trust manager, a court of
25-19 competent jurisdiction determines, after giving any notice the
25-20 court considers necessary, that the trust manager is fairly and
25-21 reasonably entitled to indemnification in view of all the relevant
25-22 circumstances, whether or not he has met the requirements set forth
25-23 in Subsection (B) of this Section or has been found liable in the
25-24 circumstances described by Subsection (C) of this Section, the
25-25 court may order the indemnification that the court determines is
25-26 proper and equitable; but if the trust manager is found liable to
25-27 the real estate investment trust or is found liable on the basis
25-28 that personal benefit was improperly received by the trust manager,
25-29 the indemnification shall be limited to reasonable expenses
25-30 actually incurred by the trust manager in connection with the
25-31 proceeding.
25-32 (K) Reasonable expenses incurred by a trust manager who was,
25-33 is, or is threatened to be made a named defendant or respondent in
25-34 a proceeding may be paid or reimbursed by the real estate
25-35 investment trust, in advance of the final disposition of the
25-36 proceeding and without the determination specified in Subsection
25-37 (F) of this Section or the authorization or determination specified
25-38 in Subsection (G) of this Section, after the real estate investment
25-39 trust receives a written affirmation by the trust manager of his
25-40 good faith belief that he has met the standard of conduct necessary
25-41 for indemnification under this Section and a written undertaking by
25-42 or on behalf of the trust manager to repay the amount paid or
25-43 reimbursed if it is ultimately determined that he has not met that
25-44 standard or if it is ultimately determined that indemnification of
25-45 the trust manager against expenses incurred by him in connection
25-46 with that proceeding is prohibited by Subsection (E) of this
25-47 Section. A provision contained in the declaration of trust, the
25-48 bylaws, a resolution of shareholders or trust managers <by-laws>,
25-49 or an agreement that makes mandatory the payment or reimbursement
25-50 permitted under this Subsection shall be deemed to constitute
25-51 authorization of that payment or reimbursement.
25-52 (L) The written undertaking required by Subsection (K) of
25-53 this Section must be an unlimited general obligation of the trust
25-54 manager but need not be secured. It may be accepted without
25-55 reference to financial ability to make repayment.
25-56 (M) A provision for a real estate investment trust to
25-57 indemnify or to advance expenses to a trust manager who was, is, or
25-58 is threatened to be made a named defendant or respondent in a
25-59 proceeding, whether contained in the declaration of trust, the
25-60 bylaws, a resolution of shareholders or trust managers <by-laws>,
25-61 an agreement, or otherwise, except in accordance with Subsection
25-62 (R) of this Section, is valid only to the extent it is consistent
25-63 with this Section as limited by the declaration of trust, if such a
25-64 limitation exists.
25-65 (N) Notwithstanding any other provision of this Section, a
25-66 real estate investment trust may pay or reimburse expenses incurred
25-67 by a trust manager in connection with his appearance as a witness
25-68 or other participation in a proceeding at a time when he is not a
25-69 named defendant or respondent in the proceeding.
25-70 (O) An officer of the real estate investment trust shall be
26-1 indemnified as, and to the same extent, provided by Subsections
26-2 (H), (I), and (J) of this Section for a trust manager and is
26-3 entitled to seek indemnification under those Subsections <Sections>
26-4 to the same extent as a trust manager. A real estate investment
26-5 trust may indemnify and advance expenses to an officer, employee,
26-6 or agent of the real estate investment trust to the same extent
26-7 that it may indemnify and advance expenses to trust managers under
26-8 this Section.
26-9 (P) A real estate investment trust may indemnify and advance
26-10 expenses to persons who are not or were not officers, employees, or
26-11 agents of the real estate investment trust but who are or were
26-12 serving at the request of the real estate investment trust as a
26-13 trust manager, director, officer, partner, venturer, proprietor,
26-14 trustee, employee, agent, or similar functionary of another real
26-15 estate investment trust or of a foreign or domestic corporation,
26-16 partnership, joint venture, sole proprietorship, trust, employee
26-17 benefit plan, or other enterprise to the same extent that it may
26-18 indemnify and advance expenses to trust managers under this
26-19 Section.
26-20 (Q) A real estate investment trust may indemnify and advance
26-21 expenses to an officer, employee, agent, or person identified in
26-22 Subsection (P) of this Section and who is not a trust manager to
26-23 such further extent, consistent with law, as may be provided by its
26-24 declaration of trust, bylaws <by-laws>, general or specific action
26-25 of its trust managers, or contract or as permitted or required by
26-26 common law.
26-27 (R) A real estate investment trust may purchase and maintain
26-28 insurance or another arrangement on behalf of any person who is or
26-29 was a trust manager officer, employee, or agent of the real estate
26-30 investment trust or who is or was serving at the request of the
26-31 real estate investment trust as a trust manager or a director,
26-32 officer, partner, venturer, proprietor, trustee, employee, agent,
26-33 or similar functionary of another real estate investment trust or
26-34 of a foreign or domestic corporation, partnership, joint venture,
26-35 sole proprietorship, trust, employee benefit plan, or other
26-36 enterprise, against any liability asserted against him and incurred
26-37 by him in such a capacity or arising out of his status as such a
26-38 person, whether or not the real estate investment trust would have
26-39 the power to indemnify him against that liability under this
26-40 Section. If the insurance or other arrangement is with a person or
26-41 entity that is not regularly engaged in the business of providing
26-42 insurance coverage, the insurance or arrangement may provide for
26-43 payment of a liability with respect to which the real estate
26-44 investment trust would not have the power to indemnify the person
26-45 only if including coverage for the additional liability has been
26-46 approved by the shareholders of the real estate investment trust.
26-47 Without limiting the power of the real estate investment trust to
26-48 procure or maintain any kind of insurance or other arrangement, a
26-49 real estate investment trust may, for the benefit of persons
26-50 indemnified by the real estate investment trust, (1) create a trust
26-51 fund; (2) establish any form of self-insurance; (3) secure its
26-52 indemnity obligation by grant of a security interest or other lien
26-53 on the assets of the real estate investment trust; or (4) establish
26-54 a letter of credit, guaranty, or surety arrangement. The insurance
26-55 or other arrangement may be procured, maintained, or established
26-56 within the real estate investment trust or with any insurer or
26-57 other person deemed appropriate by the trust manager(s) regardless
26-58 of whether all or part of the stock or other securities of the
26-59 insurer or other person are owned in whole or part by the real
26-60 estate investment trust. In the absence of fraud, the judgment of
26-61 the trust manager(s) as to the terms and conditions of the
26-62 insurance or other arrangement and the identity of the insurer or
26-63 other person participating in an arrangement shall be conclusive
26-64 and the insurance or arrangement shall not be voidable and shall
26-65 not subject the trust manager(s) approving the insurance or
26-66 arrangement to liability, on any ground, regardless of whether a
26-67 trust manager participating in the approval is a beneficiary of the
26-68 insurance or arrangement.
26-69 (S) Any indemnification of or advance of expenses to any
26-70 person who is or was a trust manager, officer, employee, or agent
27-1 of the real estate investment trust or who is or was serving at the
27-2 request of the real estate investment trust as a trust manager or a
27-3 director, officer, partner, venturer, proprietor, trustee,
27-4 employee, agent, or similar functionary of another real estate
27-5 investment trust or of a foreign or domestic corporation,
27-6 partnership, joint venture, sole proprietorship, trust, employee
27-7 benefit plan, or other enterprise in accordance with this Section
27-8 shall be reported in writing to the shareholders with or before the
27-9 notice or waiver of notice of the next shareholders meeting or with
27-10 or before the next submission to shareholders of a consent to
27-11 action without a meeting pursuant to Section 10.30 <10.2> of this
27-12 Act and, in any case, within the 12-month period immediately
27-13 following the date of the indemnification or advance.
27-14 (T) For purposes of this Section, the real estate investment
27-15 trust is deemed to have requested a trust manager to serve an
27-16 employee benefit plan whenever the performance by him of his duties
27-17 to the real estate investment trust also imposes duties on or
27-18 otherwise involves services by him to the plan or participants or
27-19 beneficiaries of the plan. Excise taxes assessed on a trust
27-20 manager with respect to an employee benefit plan pursuant to
27-21 applicable law are deemed fines. Action taken or omitted by him
27-22 with respect to an employee benefit plan in the performance of his
27-23 duties for a purpose reasonably believed by him to be in the
27-24 interest of the participants and beneficiaries of the plan is
27-25 deemed to be for a purpose which is not opposed to the best
27-26 interests of the real estate investment trust.
27-27 (U) The declaration of trust of a real estate investment
27-28 trust may restrict the circumstances under which the real estate
27-29 investment trust is required or permitted to indemnify a person
27-30 under Subsection (H), (I), (J), (O), (P), or (Q) of this Section.
27-31 Sec. 10.10 <10>. Meetings of Shareholders. (A) Meetings of
27-32 shareholders shall be held at such place, either within or without
27-33 the state, as may be provided in the bylaws <by-laws>. In the
27-34 absence of any such provision, all meetings shall be held at the
27-35 principal office of the real estate investment trust.
27-36 (B) An annual meeting of the shareholders shall be held at
27-37 such time as may be provided in the bylaws <by-laws>. In the event
27-38 the trust manager(s) fail to call the annual meeting at the
27-39 designated time, any shareholder may make demand that such meeting
27-40 be held within a reasonable time, such demand to be made in writing
27-41 by registered mail directly to any officer or trust manager of the
27-42 real estate investment trust. If the annual meeting of the
27-43 shareholders is not called within sixty (60) days following such
27-44 demand, any shareholder may compel the holding of such annual
27-45 meeting by legal action directed against said trust manager(s), and
27-46 all of the extraordinary writs of the common law and of a court of
27-47 equity shall be available to such shareholder to compel the holding
27-48 of such annual meeting. Each and every shareholder is hereby
27-49 declared to have a justiciable interest sufficient to enable him to
27-50 institute and prosecute such legal proceedings. Failure to hold
27-51 the annual meeting at the designated time may not cause the
27-52 dissolution of the real estate investment trust.
27-53 (C) Special meetings of the shareholders may be called by
27-54 the trust manager(s), any officer of the real estate investment
27-55 trust, <the holders of not less than one-tenth (1/10) of all the
27-56 shares entitled to vote at the meetings,> or such other persons as
27-57 may be provided in the declaration of trust or the bylaws. Special
27-58 meetings of the shareholders may also be called by the holders of
27-59 at least 10 percent of all the shares entitled to vote at the
27-60 proposed special meeting, unless the declaration of trust provides
27-61 for a number of shares greater than or less than 10 percent, in
27-62 which event special meetings of the shareholders may be called by
27-63 the holders of at least the percentage of shares so specified in
27-64 the declaration of trust. The declaration of trust may not provide
27-65 for a number of shares greater than 50 percent <by-laws>.
27-66 Sec. 10.20 <10.1>. Trust manager meetings and notice of
27-67 meetings. (A) Meetings of the trust manager(s), whether regular
27-68 or special, may be held either within or without this State.
27-69 (B) Regular meetings of the trust manager(s) may be held
27-70 with or without notice as prescribed in the bylaws <by-laws>.
28-1 Special meetings of the trust manager(s) shall be held upon such
28-2 notice as is prescribed in the bylaws <by-laws>. Attendance of a
28-3 trust manager at a meeting shall constitute a waiver of notice of
28-4 such meeting, except where a trust manager attends a meeting for
28-5 the express purpose of objecting to the transaction of any business
28-6 on the ground that the meeting is not lawfully called or convened.
28-7 Neither the business to be transacted at, nor the purpose of, any
28-8 regular or special meeting of the trust manager(s) need be
28-9 specified in the notice or waiver of notice of such meeting, unless
28-10 required by the bylaws <by-laws>.
28-11 Sec. 10.30 <10.2>. Actions without a meeting;<:> telephone
28-12 meetings. (A) Unless otherwise provided by the declaration of
28-13 trust or bylaws, any <Any> action required or permitted <by this
28-14 Act> to be taken at a meeting of the shareholders of a real estate
28-15 investment trust<, or any action which may be taken at a meeting of
28-16 the shareholders,> may be taken without a meeting if a consent in
28-17 writing, setting forth the action so taken, shall be signed by all
28-18 of the shareholders entitled to vote with respect to the subject
28-19 matter thereof. Such action<, and such consent> shall then have
28-20 the same force and effect as action taken at a meeting <a unanimous
28-21 vote of shareholders>, and may be stated as such in any declaration
28-22 of trust or document filed with the county clerk of the county of
28-23 the principal place of business of the real estate investment trust
28-24 or with the secretary of state.
28-25 (B) Unless otherwise provided <restricted> by the
28-26 declaration of trust or bylaws <by-laws>, any action required or
28-27 permitted to be taken at a meeting of the trust manager(s) or any
28-28 committee may be taken without a meeting if a consent in writing,
28-29 setting forth the action so taken, is signed by all the trust
28-30 managers or members of such committee, as the case may be. Such
28-31 action <consent> shall then have the same force and effect as
28-32 action taken <a unanimous vote> at a meeting, and may be stated as
28-33 such in any document or instrument filed with the county clerk of
28-34 the county of the principal place of business of the trust or with
28-35 the secretary of state.
28-36 (C) Subject to the provisions required or permitted by this
28-37 Act for notice of meetings, unless otherwise restricted by the
28-38 declaration of trust or bylaws <by-laws>, shareholders, trust
28-39 manager(s), or members of any committee designated by such trust
28-40 manager(s), may participate in and hold a meeting of such
28-41 shareholders, trust manager(s) or committee by means of conference
28-42 telephone or similar communications equipment by means of which all
28-43 persons participating in the meeting can hear each other, and
28-44 participation in a meeting pursuant to this Section shall
28-45 constitute presence in person at such meeting, except where a
28-46 person participates in the meeting for the express purpose of
28-47 objecting to the transaction of any business on the ground that the
28-48 meeting is not lawfully called or convened.
28-49 (D) If action is taken with respect to a particular matter
28-50 by the holders of shares of a class or series by means of a written
28-51 consent in compliance with Subsection (A) of this Section, any
28-52 provision of this Act that requires advance notice of a meeting or
28-53 of the proposed action does not apply as to that class or series
28-54 for that action.
28-55 Sec. 11.10 <11>. Notice of shareholders meetings.
28-56 (A) Written or printed notice stating the place, day and hour of
28-57 the meeting and, in case of a special meeting, the purpose or
28-58 purposes for which the meeting is called, shall be delivered not
28-59 less than ten (10) nor more than sixty (60) days before the date of
28-60 the meeting, either personally or by mail, by or at the direction
28-61 of the trust manager(s) or any officer or person calling the
28-62 meeting, to each shareholder of record entitled to vote at such
28-63 meeting. If mailed, such notice shall be deemed to be delivered
28-64 when deposited in the United States Mail addressed to the
28-65 shareholder at his address as it appears on the books of the trust,
28-66 with postage thereon prepaid.
28-67 (B) Any notice otherwise required to be given to any
28-68 shareholder under this Act or the declaration of trust or bylaws of
28-69 any real estate investment trust is not required for the
28-70 shareholder if:
29-1 (1) notice of two consecutive annual meetings and all
29-2 notices of meetings held during the period between those annual
29-3 meetings, if any, have been mailed to the shareholder at the
29-4 address shown on the share transfer records of the real estate
29-5 investment trust and the notice has been returned undeliverable; or
29-6 (2) all (but in no event less than two) payments (if
29-7 sent by first class mail) of distributions or interest on
29-8 securities during a 12-month period have been mailed to the
29-9 shareholder at the address shown on the share transfer records of
29-10 the real estate investment trust, and the payments have been
29-11 returned undeliverable.
29-12 (C) Any action or meeting taken or held without notice to a
29-13 shareholder described by Subsection (B) of this Section has the
29-14 same force and effect as if the notice had been duly given to the
29-15 shareholder. If the action taken by the real estate investment
29-16 trust is reflected in any document filed with the Secretary of
29-17 State, that document may state that notice was duly given to all
29-18 persons to whom notice was required to be given. If a shareholder
29-19 described by Subsection (B) of this Section delivers to the real
29-20 estate investment trust a written notice setting forth the
29-21 shareholder's current address, the requirement that notice be given
29-22 to the shareholder shall be reinstated.
29-23 Sec. 11.20. REGISTERED HOLDERS OF SHARES, CLOSING OF SHARE
29-24 TRANSFER RECORDS, AND RECORD DATE. (A) Unless otherwise provided
29-25 in this Act, and subject to the provisions of Chapter 8, Business &
29-26 Commerce Code, a real estate investment trust may regard the person
29-27 in whose name any shares issued by the real estate investment trust
29-28 are registered in the share transfer records of the real estate
29-29 investment trust at any particular time (including shares
29-30 registered as of a record date fixed under Subsection (B) or (C) of
29-31 this Section) as the owner of those shares at that time for
29-32 purposes of:
29-33 (1) voting those shares;
29-34 (2) receiving distributions on or notices in respect
29-35 of those shares;
29-36 (3) transferring those shares;
29-37 (4) exercising rights of dissent with respect to those
29-38 shares;
29-39 (5) exercising or waiving any preemptive right with
29-40 respect to those shares;
29-41 (6) entering into agreements with respect to those
29-42 shares in accordance with Section 7.40 or 13.20 of this Act; or
29-43 (7) giving proxies with respect to those shares.
29-44 (B) Neither the real estate investment trust nor any of the
29-45 officers, trust manager(s), employees, or agents of the real estate
29-46 investment trust are liable for regarding a person described by
29-47 Subsection (A) of this Section as the owner of those shares at that
29-48 time for those purposes, regardless of whether that person does not
29-49 possess a certificate for those shares.
29-50 (C) For the purpose of determining shareholders entitled to
29-51 notice of or to vote at any meeting of shareholders or any
29-52 adjournment of a meeting of shareholders, or shareholders entitled
29-53 to receive a distribution by a real estate investment trust (other
29-54 than a distribution involving a purchase or redemption by the real
29-55 estate investment trust of any of its own shares) or a share
29-56 dividend, or in order to make a determination of shareholders for
29-57 any other proper purpose (other than determining shareholders
29-58 entitled to consent to action by shareholders proposed to be taken
29-59 without a meeting of shareholders), the trust manager(s) of a real
29-60 estate investment trust may provide that the share transfer records
29-61 shall be closed for a stated period not to exceed 60 days. If the
29-62 share transfer records are closed for the purpose of determining
29-63 shareholders entitled to notice of or to vote at a meeting of
29-64 shareholders, the share transfer records shall be closed for at
29-65 least 10 days immediately before the meeting. In lieu of closing
29-66 the share transfer records, the bylaws, or in the absence of an
29-67 applicable bylaw, the trust manager(s), may fix in advance a date
29-68 as the record date for the determination of shareholders. The
29-69 record date for any such determination of shareholders may not be
29-70 more than 60 days and, in the case of a meeting of shareholders,
30-1 not less than 10 days, before the date on which the particular
30-2 action requiring the determination of shareholders is to be taken.
30-3 If the share transfer records are not closed and no record date is
30-4 fixed for the determination of shareholders entitled to notice of
30-5 or to vote at a meeting of shareholders, or shareholders entitled
30-6 to receive a distribution (other than a distribution involving a
30-7 purchase or redemption by the real estate investment trust of any
30-8 of its own shares) or a share dividend, the date on which notice of
30-9 the meeting is mailed or the date on which the resolution of the
30-10 trust manager(s) declaring such distribution or share dividend is
30-11 adopted, as the case may be, shall be the record date for such
30-12 determination of shareholders. When a determination of
30-13 shareholders entitled to vote at any meeting of shareholders has
30-14 been made in the manner provided in this Section, the determination
30-15 of shareholders shall apply to any adjournment of the meeting of
30-16 shareholders except where the determination has been made through
30-17 the closing of the share transfer records and the stated period of
30-18 closing has expired.
30-19 (D) Unless a record date has previously been fixed or
30-20 determined under this Section, when action by shareholders is
30-21 proposed to be taken by written consent without a meeting of
30-22 shareholders, the trust manager(s) may fix a record date for the
30-23 purpose of determining shareholders entitled to consent to that
30-24 action. The record date may not precede, and may not be more than
30-25 10 days after, the date on which the trust managers adopt the
30-26 resolution fixing the record date. If no record date has been
30-27 fixed by the trust manager(s) and the prior action of the trust
30-28 manager(s) is not required by this Act, the record date for
30-29 determining shareholders entitled to consent to action in writing
30-30 without a meeting shall be the first date on which a signed written
30-31 consent setting forth the action taken or proposed to be taken is
30-32 delivered by hand or by certified or registered mail, return
30-33 receipt requested, to the real estate investment trust as provided
30-34 by Subsection (A) of Section 10.30 of this Act. Delivery to the
30-35 real estate investment trust's principal place of business shall be
30-36 addressed to the president or the principal executive officer of
30-37 the real estate investment trust. If no record date shall have
30-38 been fixed by the trust manager(s) and prior action of the trust
30-39 manager(s) is required by this Act, the record date for determining
30-40 shareholders entitled to consent to action in writing without a
30-41 meeting shall be at the close of business on the date on which the
30-42 trust manager(s) adopt a resolution taking such prior action.
30-43 (E) Distributions made by a real estate investment trust,
30-44 including those distributions that were payable but not paid to a
30-45 holder of shares, or to the holder's heirs, successors, or assigns,
30-46 and have been held in suspense by the real estate investment trust
30-47 or were paid or delivered by the real estate investment trust into
30-48 an escrow account or to a trustee or custodian, shall be payable by
30-49 the real estate investment trust, escrow agent, trustee, or
30-50 custodian of the distributions to the holder of the shares as of
30-51 the record date determined for that distribution as provided in
30-52 Subsection (B) of this Section, or to the holder's heirs,
30-53 successors, or assigns.
30-54 Sec. 12.10 <12>. QUORUM OF AND VOTING BY SHAREHOLDERS.
30-55 (A) Unless otherwise provided in the declaration of trust in
30-56 accordance with this Section, with respect to any meeting of
30-57 shareholders, a quorum shall be present for any matter to be
30-58 presented at that meeting if the holders of a majority of the
30-59 shares entitled to vote at the meeting are represented at the
30-60 meeting in person or by proxy. The declaration of trust may
30-61 provide:
30-62 (1) that a quorum is present at a meeting of
30-63 shareholders only if the holders of a specified greater portion of
30-64 the shares entitled to vote are represented at the meeting in
30-65 person or by proxy; or
30-66 (2) that a quorum is present at a meeting of
30-67 shareholders if the holders of a specified lesser portion, but not
30-68 less than one-third (1/3), of the shares entitled to vote are
30-69 represented at the meeting in person or by proxy.
30-70 (B) Unless otherwise provided in the declaration of trust or
31-1 the bylaws, once a quorum is present at a meeting of shareholders,
31-2 the shareholders represented in person or by proxy at the meeting
31-3 may conduct such business as may be properly brought before the
31-4 meeting until the meeting is adjourned. The subsequent withdrawal
31-5 of any shareholder from the meeting or the refusal of any
31-6 shareholder represented in person or by proxy to vote does not
31-7 affect the presence of a quorum at the meeting. Unless otherwise
31-8 provided in the declaration of trust or the bylaws, the
31-9 shareholders represented in person or by proxy at a meeting of
31-10 shareholders at which a quorum is not present may adjourn the
31-11 meeting until such time and to such place as may be determined by a
31-12 vote of the holders of a majority of the shares represented in
31-13 person or by proxy at that meeting.
31-14 (C) With respect to any matter, other than the election of
31-15 trust manager(s) or a matter for which the affirmative vote of the
31-16 holders of a specified portion of the shares entitled to vote is
31-17 required by this Act, the affirmative vote of the holders of a
31-18 majority of the shares entitled to vote on, and that voted for or
31-19 against or expressly abstained with respect to, that matter at a
31-20 meeting of shareholders at which a quorum is present shall be the
31-21 act of the shareholders, unless otherwise provided in the
31-22 declaration of trust or the bylaws in accordance with this Section.
31-23 With respect to any matter, other than the election of trust
31-24 manager(s) or a matter for which the affirmative vote of the
31-25 holders of a specified portion of the shares entitled to vote is
31-26 required by this Act, the declaration of trust or the bylaws may
31-27 provide:
31-28 (1) that the act of the shareholders shall be the
31-29 affirmative vote of the holders of a specified portion, but not
31-30 less than a majority, of the shares entitled to vote on that
31-31 matter;
31-32 (2) that the act of the shareholders shall be the
31-33 affirmative vote of the holders of a specified portion, but not
31-34 less than a majority, of the shares entitled to vote on that matter
31-35 and represented in person or by proxy at a meeting of shareholders
31-36 at which a quorum is present;
31-37 (3) that the act of the shareholders shall be the
31-38 affirmative vote of the holders of a specified portion, but not
31-39 less than a majority, of the shares entitled to vote on, and voted
31-40 for or against, that matter at a meeting of shareholders at which a
31-41 quorum is present; or
31-42 (4) that the act of the shareholders shall be the
31-43 affirmative vote of the holders of a specified portion, but not
31-44 less than a majority, of the shares entitled to vote on, and that
31-45 voted for or against or expressly abstained with respect to, that
31-46 matter at a meeting of shareholders at which a quorum is present.
31-47 (D) Unless otherwise provided in the declaration of trust or
31-48 the bylaws in accordance with this Section, trust manager(s) shall
31-49 be elected by two-thirds (2/3) of the votes cast by the holders of
31-50 shares entitled to vote in the election of trust manager(s) at a
31-51 meeting of shareholders at which a quorum is present. The
31-52 declaration of trust or the bylaws may provide:
31-53 (1) that a trust manager shall be elected only if the
31-54 trust manager receives the vote of the holders of a specified
31-55 portion, but not less than a majority, of the shares entitled to
31-56 vote in the election of trust manager(s);
31-57 (2) that a trust manager shall be elected only if the
31-58 trust manager receives the vote of the holders of a specified
31-59 portion, but not less than a majority, of the shares entitled to
31-60 vote in the election of trust manager(s) and represented in person
31-61 or by proxy at a meeting of shareholders at which a quorum is
31-62 present; or
31-63 (3) that a trust manager shall be elected only if the
31-64 trust manager receives a specified portion, but not less than a
31-65 majority, of the votes cast by the holders of shares entitled to
31-66 vote in the election of trust manager(s) at a meeting of
31-67 shareholders at which a quorum is present.
31-68 (E) With respect to any matter for which the affirmative
31-69 vote of the holders of a specified portion of the shares entitled
31-70 to vote is required by this Act, the declaration of trust may
32-1 provide that the act of the shareholders on that matter shall be
32-2 the affirmative vote of the holders of a specified portion, but not
32-3 less than a majority, of the shares entitled to vote on that
32-4 matter, rather than the affirmative vote otherwise required by this
32-5 Act. With respect to any matter for which the affirmative vote of
32-6 the holders of a specified portion of the shares of any class or
32-7 series is required by this Act, the declaration of trust also may
32-8 provide that the act of the holders of shares of that class or
32-9 series on that matter shall be the affirmative vote of the holders
32-10 of a specified portion, but not less than a majority, of the shares
32-11 of that class or series, rather than the affirmative vote of the
32-12 holders of shares of that class or series otherwise required by
32-13 this Act. If any provision of the declaration of trust provides
32-14 that the act of the shareholders on any matter shall be the
32-15 affirmative vote of the holders of a specified portion of the
32-16 shares entitled to vote on that matter that is greater than a
32-17 majority of the shares so entitled to vote, that provision of the
32-18 declaration of trust may not be amended or modified, directly or
32-19 indirectly, without the affirmative vote of the holders of that
32-20 greater portion of the shares entitled to vote on that matter,
32-21 unless otherwise provided in the declaration of trust. If any
32-22 provision of the declaration of trust provides that the act of the
32-23 holders of shares of any class or series on any matter shall be the
32-24 affirmative vote of the holders of a specified portion of the
32-25 shares of that class or series that is greater than a majority of
32-26 the shares of that class or series, that provision of the
32-27 declaration of trust may not be amended or modified, directly or
32-28 indirectly, without the affirmative vote of the holders of that
32-29 greater portion of the shares of that class or series, unless
32-30 otherwise provided in the declaration of trust.
32-31 (F) A real estate investment trust may establish procedures
32-32 in its bylaws, consistent with this Act, for determining the
32-33 validity of proxies and whether shares that are held of record by a
32-34 bank, broker, or other nominee are represented at a meeting of
32-35 shareholders with respect to any matter. Those procedures may
32-36 incorporate or look to rules and determinations of self regulatory
32-37 organizations regulating that bank, broker, or other nominee
32-38 <Unless otherwise provided in the declaration of trust, the holders
32-39 of a majority of the shares entitled to vote, represented in person
32-40 or by proxy, shall constitute a quorum at a meeting of
32-41 shareholders, but in no event shall a quorum consist of the holders
32-42 of less than one-third (1/3) of the shares entitled to vote and
32-43 thus represented at such meeting. The vote of the holders of a
32-44 majority of the shares entitled to vote and thus represented at a
32-45 meeting at which a quorum is present, shall be the act of the
32-46 shareholders meeting, unless the vote of a greater number is
32-47 required by law, the declaration of trust or by-laws>.
32-48 Sec. 13.10 <13>. VOTING OF SHARES. (A)(1) Each outstanding
32-49 share, regardless of class, shall be entitled to one vote on each
32-50 matter submitted to a vote at a meeting of shareholders, except:
32-51 (a) to the extent that the declaration of trust
32-52 provides for more or less than one vote per share or (if and to the
32-53 extent permitted by this Act) limits or denies voting rights to the
32-54 holders of the shares of any class or series; or
32-55 (b) as otherwise provided by this Act.
32-56 (2) If the declaration of trust provides for more or
32-57 less than one vote per share for all the outstanding shares or for
32-58 the shares of any class or any series on any matter, every
32-59 reference in this Act (or in the declaration of trust or bylaws,
32-60 unless expressly stated otherwise in the declaration of trust or
32-61 bylaws), in connection with such matter, to a specified portion of
32-62 those shares shall mean the portion of the votes entitled to be
32-63 cast in respect of the shares by virtue of the provisions of the
32-64 declaration of trust.
32-65 (B) Shares of the stock of a real estate investment trust
32-66 that are owned by another real estate investment trust or
32-67 corporation, if a majority of the voting stock of the other real
32-68 estate investment trust or corporation is owned or controlled by
32-69 the real estate investment trust, may not be voted, directly or
32-70 indirectly, at any meeting, and may not be counted in determining
33-1 the total number of outstanding shares at any given time. Nothing
33-2 in this Subsection shall be construed as limiting the right of any
33-3 real estate investment trust to vote stock, including voting its
33-4 own stock, held or controlled by the real estate investment trust
33-5 in a fiduciary capacity or with respect to which the real estate
33-6 investment trust otherwise exercises voting power in a fiduciary
33-7 capacity.
33-8 (C) Any shareholder may vote either in person or by proxy
33-9 executed in writing by the shareholder. A telegram, telex,
33-10 cablegram, or similar transmission by the shareholder, or a
33-11 photographic, photostatic, facsimile, or similar reproduction of a
33-12 writing executed by the shareholder, shall be treated as an
33-13 execution in writing for purposes of this Section. No proxy shall
33-14 be valid after 11 months from the date of its execution unless
33-15 provided otherwise in the proxy. A proxy shall be revocable unless
33-16 the proxy form conspicuously states that the proxy is irrevocable
33-17 and the proxy is coupled with an interest. Proxies coupled with an
33-18 interest include the appointment as proxy of:
33-19 (1) a pledgee;
33-20 (2) a person who purchased or agreed to purchase, or
33-21 owns or holds an option to purchase, the shares;
33-22 (3) a creditor of the real estate investment trust who
33-23 extended to the real estate investment trust credit under terms
33-24 requiring the appointment;
33-25 (4) an employee of the real estate investment trust
33-26 whose employment contract requires the appointment; or
33-27 (5) a party to a voting agreement created under
33-28 Subsection (B) of Section 13.20 of this Act.
33-29 (D) An irrevocable proxy, if noted conspicuously on the
33-30 certificate representing the shares that are subject to the
33-31 irrevocable proxy or, in the case of uncertificated shares, if
33-32 notation of the irrevocable proxy is contained in the notice sent
33-33 pursuant to Subsection (D) of Section 7.20 of this Act with respect
33-34 to the shares that are subject to the irrevocable proxy, shall be
33-35 specifically enforceable against the holder of those shares or any
33-36 successor or transferee of the holder. Unless noted conspicuously
33-37 on the certificate representing the shares that are subject to the
33-38 irrevocable proxy or, in the case of uncertificated shares, unless
33-39 notation of the irrevocable proxy is contained in the notice sent
33-40 pursuant to Subsection (D) of Section 7.20 of this Act with respect
33-41 to the shares that are subject to the irrevocable proxy, an
33-42 irrevocable proxy, even though otherwise enforceable, is
33-43 ineffective against a transferee for value without actual knowledge
33-44 of the existence of the irrevocable proxy at the time of the
33-45 transfer or against any subsequent transferee (whether or not for
33-46 value). The irrevocable proxy shall be specifically enforceable
33-47 against any other person who is not a transferee for value from and
33-48 after the time that the person acquires actual knowledge of the
33-49 existence of the irrevocable proxy.
33-50 (E)(1) At each election of trust manager(s), every
33-51 shareholder entitled to vote at the election shall have the right
33-52 to vote, in person or by proxy, the number of shares owned by the
33-53 shareholder for as many persons as there are trust manager(s) to be
33-54 elected and for whose election the shareholder has a right to vote.
33-55 (2) Cumulative voting, whereby a shareholder gives one
33-56 candidate as many votes as the number of trust manager(s)
33-57 multiplied by the shareholder's shares shall equal, or by
33-58 distributing such votes on the same principle among any number of
33-59 candidates, may not be permitted unless specifically authorized in
33-60 the declaration of trust. If cumulative voting is authorized in
33-61 the declaration of trust, any shareholder who intends to cumulate
33-62 the shareholder's votes accordingly must give written notice of the
33-63 shareholder's intention to cumulate the shareholder's votes to the
33-64 trust manager(s) on or before the day preceding the election at
33-65 which the shareholder intends to cumulate the shareholder's votes.
33-66 (F) Shares standing in the name of another real estate
33-67 investment trust or corporation, domestic or foreign, may be voted
33-68 by an officer, agent, or proxy that is authorized to vote those
33-69 shares by the bylaws of the real estate investment trust or
33-70 corporation, or, in the absence of such authorization, by an
34-1 officer, agent, or proxy as determined by the trust manager(s) or
34-2 board of directors of the real estate investment trust or
34-3 corporation. When any foreign real estate investment trust or
34-4 corporation without a permit to do business in this state lawfully
34-5 owns or may lawfully own or acquire stock in a Texas real estate
34-6 investment trust, the foreign real estate investment trust or
34-7 corporation may vote that stock and participate in the management
34-8 and control of the business and affairs of the Texas real estate
34-9 investment trust, as other shareholders, subject to all laws and
34-10 rules governing real estate investment trusts in this state,
34-11 including especially the provisions of the antitrust laws of this
34-12 state.
34-13 (G) Shares held by a person who is an administrator,
34-14 executor, guardian, or conservator may be voted by the person so
34-15 long as the shares forming a part of an estate are in the
34-16 possession and forming a part of the estate being served by the
34-17 person, either personally or by proxy, without a transfer of such
34-18 shares into the person's name. Shares standing in the name of a
34-19 trustee may be voted by the trustee, either personally or by proxy,
34-20 but a trustee is not entitled to vote shares held by the trustee
34-21 without a transfer of those shares into the trustee's name as
34-22 trustee.
34-23 (H) Shares standing in the name of, held by, or under the
34-24 control of a receiver may be voted by the receiver, without
34-25 transferring the shares into the receiver's name if authority to
34-26 vote the shares is contained in an appropriate court order by which
34-27 the receiver was appointed to serve as receiver.
34-28 (I) A shareholder whose shares are pledged is entitled to
34-29 vote those shares until the shares have been transferred into the
34-30 pledgee's name. After the shares have been transferred into the
34-31 pledgee's name, the pledgee shall be entitled to vote the
34-32 transferred shares <A shareholder may vote either in person or by
34-33 proxy executed in writing by the shareholder or by his duly
34-34 authorized attorney in fact. No proxy shall be valid after eleven
34-35 (11) months from the date of its execution unless otherwise
34-36 provided in the proxy. Each proxy shall be revocable unless
34-37 expressly provided therein to be irrevocable, but in no event shall
34-38 it remain irrevocable for a period of more than eleven (11) months.>
34-39 <(C)(1) At each election for trust manager(s) every
34-40 shareholder entitled to vote at such election shall have the right
34-41 to vote, in person or by proxy, the number of shares owned by him
34-42 for as many persons as there are trust manager(s) to be elected and
34-43 for whose election he has a right to vote, or unless expressly
34-44 prohibited by the declaration of trust, to cumulate his votes by
34-45 giving one (1) candidate as many votes as the number of such trust
34-46 manager(s) multiplied by his shares shall equal, or by distributing
34-47 such votes on the same principle among any number of such
34-48 candidates.>
34-49 <(2) No amendment of the declaration of trust
34-50 prohibiting the right of cumulative voting shall be effective
34-51 unless at least sixty-six and two-thirds per cent (66 2/3%) of the
34-52 outstanding shares entitled to vote upon such amendment shall have
34-53 been voted in favor of such amendment.>
34-54 <(3) Any shareholder who intends to cumulate his votes
34-55 as herein authorized shall give written notice of such intention to
34-56 the trust manager(s) on or before the day preceding the election at
34-57 which such shareholder intends to cumulate his votes>.
34-58 Sec. 13.20. VOTING TRUSTS AND VOTING AGREEMENTS. (A) Any
34-59 number of shareholders of a real estate investment trust may enter
34-60 into a written voting trust agreement to confer on a trustee or
34-61 trustees the right to vote or otherwise represent shares of the
34-62 real estate investment trust. The shares that are to be subject to
34-63 the agreement shall be transferred to the trustee or trustees for
34-64 purposes of the agreement, and a counterpart of the agreement shall
34-65 be deposited with the real estate investment trust at its principal
34-66 place of business or registered office. The counterpart of the
34-67 voting trust agreement deposited with the real estate investment
34-68 trust shall be subject to the same right of examination by a
34-69 shareholder of the real estate investment trust, in person or by
34-70 agent or attorney, as are the books and records of the real estate
35-1 investment trust, and shall be subject to examination by any holder
35-2 of a beneficial interest in the voting trust, either in person or
35-3 by agent or attorney, at any reasonable time for any proper
35-4 purpose.
35-5 (B) Any number of shareholders of a real estate investment
35-6 trust, or any number of shareholders of a real estate investment
35-7 trust and the real estate investment trust itself, may enter into a
35-8 written voting agreement for the purpose of providing that shares
35-9 of the real estate investment trust must be voted in the manner
35-10 prescribed in the agreement. A counterpart of the agreement shall
35-11 be deposited with the real estate investment trust at its principal
35-12 place of business or registered office and shall be subject to the
35-13 same right of examination by a shareholder of the real estate
35-14 investment trust, in person or by agent or attorney, as are the
35-15 books and records of the real estate investment trust. The
35-16 agreement is specifically enforceable against the holders of those
35-17 shares or any successor or transferee of the holder, if the
35-18 agreement is noted conspicuously on the certificate representing
35-19 the shares that are subject to the agreement or, in the case of
35-20 uncertificated shares, if notation of the agreement is contained in
35-21 the notice sent pursuant to Subsection (D) of Section 7.20 of this
35-22 Act with respect to the shares that are subject to the agreement.
35-23 Unless noted conspicuously on the certificate representing the
35-24 shares that are subject to the agreement or, in the case of
35-25 uncertificated shares, unless notation of the agreement is
35-26 contained in the notice sent pursuant to Subsection (D) of Section
35-27 7.20 of this Act with respect to the shares that are subject to the
35-28 agreement, the agreement, even though otherwise enforceable, is
35-29 ineffective against a transferee for value without actual knowledge
35-30 of the existence of the agreement at the time of the transfer or
35-31 against any subsequent transferee (whether or not for value). The
35-32 agreement is specifically enforceable against any other person who
35-33 is not a transferee for value from and after the time that the
35-34 person acquires actual knowledge of the existence of the agreement.
35-35 A voting agreement entered into pursuant to this Subsection is not
35-36 subject to Subsection (A) of this Section.
35-37 Sec. 14.10 <14>. DISTRIBUTIONS <DIVIDENDS>. (A) The trust
35-38 manager(s) may authorize and the real estate investment trust may
35-39 make distributions subject to any restrictions in its declaration
35-40 of trust and to the limitations set forth in this Section.
35-41 (B) A real estate investment trust may not make a
35-42 distribution if:
35-43 (1) after giving effect to the distribution, the real
35-44 estate investment trust would be insolvent; or
35-45 (2) the distribution exceeds the surplus of the real
35-46 estate investment trust.
35-47 (C) Notwithstanding the limitation set forth in Subdivision
35-48 (2) of Subsection (B) of this Section, if the net assets of a real
35-49 estate investment trust are not less than the amount of the
35-50 proposed distribution, the real estate investment trust may make a
35-51 distribution involving a purchase or redemption of any of its own
35-52 shares if the purchase or redemption is made by the real estate
35-53 investment trust to:
35-54 (1) eliminate fractional shares;
35-55 (2) collect or compromise indebtedness owed by or to
35-56 the real estate investment trust;
35-57 (3) pay dissenting shareholders entitled to payment
35-58 for their shares under this Act; or
35-59 (4) effect the purchase or redemption of redeemable
35-60 shares in accordance with this Act.
35-61 (D) A real estate investment trust's indebtedness to a
35-62 shareholder incurred by reason of a distribution made in accordance
35-63 with this Section shall be at parity with the real estate
35-64 investment trust's indebtedness to its general, unsecured
35-65 creditors, except to the extent the indebtedness is subordinated,
35-66 or payment of that indebtedness is secured, by agreement <The trust
35-67 manager(s) may from time to time, declare and the trust may pay,
35-68 dividends on its outstanding shares in cash, in property, or in its
35-69 own shares, except when the trust is insolvent or when the payment
35-70 thereof would render the trust insolvent, or when the declaration
36-1 or payment thereof would be contrary to any restrictions contained
36-2 in the declaration of trust.>
36-3 <(B) The trust manager(s) must, when requested by the
36-4 holders of at least one-third (1/3) of the outstanding shares of
36-5 the trust, present written reports of the situation and amount of
36-6 business of the trust and, subject to limitations on the authority
36-7 of the trust manager(s) by provisions of law, or the declaration of
36-8 trust or the by-laws, the trust manager(s) shall declare and
36-9 provide for payment of such dividends of the profits from the
36-10 business of the trust as such trust manager(s) shall deem
36-11 expedient>.
36-12 Sec. 14.20. SHARE DIVIDENDS. (A) The trust manager(s) of a
36-13 real estate investment trust may authorize and the real estate
36-14 investment trust may pay share dividends subject to any
36-15 restrictions in the declaration of trust of the real estate
36-16 investment trust and to the limitations set forth in this Section.
36-17 (B) A real estate investment trust may not pay a share
36-18 dividend payable in authorized but unissued shares if the surplus
36-19 of the real estate investment trust is less than the amount
36-20 required by this Section to be transferred to stated capital at the
36-21 time that share dividend is paid.
36-22 (C) If a share dividend is payable in authorized but
36-23 unissued shares having a par value, those shares shall be issued at
36-24 the par value. At the time that share dividend is paid, an amount
36-25 of surplus designated by the trust manager(s), in an amount not
36-26 less than the aggregate par value of the shares to be issued as a
36-27 share dividend, shall be transferred to stated capital.
36-28 (D) If a share dividend is payable in authorized but
36-29 unissued shares without par value, those shares shall be issued at
36-30 the value fixed by resolution of the trust manager(s) adopted at
36-31 the time the share dividend is authorized. At the time the share
36-32 dividend is paid, an amount of surplus equal to the aggregate value
36-33 fixed in respect of those shares shall be transferred to stated
36-34 capital.
36-35 (E) A share dividend payable in shares of any class may not
36-36 be paid to the holders of shares of any other class unless the
36-37 declaration of trust so provides or unless the payment is
36-38 authorized by the affirmative vote or the written consent of the
36-39 holders of at least a majority of the outstanding shares of the
36-40 class in which the payment is to be made.
36-41 Sec. 14.30. SPLIT-UP OR DIVISION WITHOUT STATED CAPITAL
36-42 INCREASE. A split-up or division of the issued shares of any class
36-43 of a real estate investment trust into a greater number of shares
36-44 of the same class without increasing the stated capital of the real
36-45 estate investment trust does not constitute a share dividend or a
36-46 distribution and may therefore be approved and authorized by the
36-47 trust manager(s) and carried out by the real estate investment
36-48 trust.
36-49 Sec. 14.40. DETERMINATION OF NET ASSETS, STATED CAPITAL, AND
36-50 SURPLUS. (A) Determinations whether a real estate investment
36-51 trust is insolvent and determinations of the value of the net
36-52 assets and of stated capital and surplus of the real estate
36-53 investment trust, and each of their components, may, but are not
36-54 required to, be based on:
36-55 (1) financial statements of the real estate investment
36-56 trust that present the financial condition of the real estate
36-57 investment trust in accordance with generally accepted accounting
36-58 principles, including financial statements that include subsidiary
36-59 or other entities accounted for on a consolidated basis or on the
36-60 equity method of accounting;
36-61 (2) financial statements prepared on the basis of
36-62 accounting used to file the real estate investment trust's federal
36-63 income tax return or any other accounting practices and principles
36-64 that are reasonable in the circumstances;
36-65 (3) financial information that is prepared on a basis
36-66 consistent with the financial statements referred to in
36-67 Subdivisions (1) and (2) of this Subsection, including condensed or
36-68 summary financial statements;
36-69 (4) projection, forecast, or other forward-looking
36-70 information relating to the future economic performance, financial
37-1 condition, or liquidity of the real estate investment trust that is
37-2 reasonable in the circumstances;
37-3 (5) a fair valuation or information from any other
37-4 method that is reasonable in the circumstances; or
37-5 (6) any combination of the statements, valuations, or
37-6 information authorized by this Subsection.
37-7 (B) Subsection (A) of this Section and the determinations
37-8 made in accordance with that Subsection do not apply to the
37-9 calculation of any tax imposed under the laws of this state.
37-10 Sec. 14.50. DATE OF DETERMINATION OF SURPLUS. (A) In the
37-11 case of a distribution by a real estate investment trust or the
37-12 payment of a share dividend, the surplus of the real estate
37-13 investment trust shall be determined, and the determination whether
37-14 the real estate investment trust would be insolvent after giving
37-15 effect to the distribution shall be made:
37-16 (1) if the action is to be taken on or before the
37-17 120th day after the date of authorization, on the date that action
37-18 is authorized by the trust manager(s); or
37-19 (2) if the action is taken after the 120th day after
37-20 the date of authorization, on the date:
37-21 (a) that is within 120 days before the date the
37-22 action is to be taken and that is designated by the trust
37-23 manager(s); or
37-24 (b) on the date the action is taken if the trust
37-25 manager(s) does not make the designation described by Subdivision
37-26 (2)(a) of this Subsection.
37-27 (B) For the purposes of this Section, a distribution that
37-28 involves the incurrence by a real estate investment trust of any
37-29 indebtedness or deferred payment obligation or a distribution that
37-30 involves a contract by the real estate investment trust to acquire
37-31 any of its own shares is considered to have been made on the date
37-32 the indebtedness or obligation is incurred or, in the case of a
37-33 contract to purchase shares, at the option of the real estate
37-34 investment trust, either the date the contract is made or is
37-35 effective or the date on which the shares to be acquired are
37-36 acquired.
37-37 Sec. 14.60. SURPLUS AND RESERVES. A real estate investment
37-38 trust, by resolution of its trust managers, may:
37-39 (1) create a reserve or reserves out of its surplus or
37-40 designate or allocate any part or all of its surplus in any manner
37-41 for any proper purpose or purposes; and
37-42 (2) increase, decrease, or abolish the reserve,
37-43 designation, or allocation in the same manner.
37-44 Sec. 15.10 <15>. Liability of trust manager(s). (A) In
37-45 addition to any other liabilities imposed by law upon trust
37-46 manager(s) of a real estate investment trust:
37-47 (1) The trust manager(s) of a real estate investment
37-48 trust who vote for or assent to any distribution of assets of a
37-49 real estate investment trust to its shareholders during the
37-50 liquidation of the real estate investment trust without the payment
37-51 and discharge of, or making adequate provisions for, all known
37-52 debts, obligations and liabilities of the real estate investment
37-53 trust shall be jointly and severally liable to the real estate
37-54 investment trust for the value of such assets which are
37-55 distributed, to the extent that such debts, obligations and
37-56 liabilities of the real estate investment trust are not thereafter
37-57 paid and discharged.
37-58 (2) The trust manager(s) of a real estate investment
37-59 trust who vote for or assent to the making of a loan to an officer
37-60 or real estate investment trust manager(s) of the real estate
37-61 investment trust or the making of any loans secured by the shares
37-62 of the real estate investment trust, shall be jointly and severally
37-63 liable to the real estate investment trust for the amount of such
37-64 loan until the repayment thereof.
37-65 (3) If the real estate investment trust shall commence
37-66 business <operations> before the real estate investment trust has
37-67 received for the issuance of shares of beneficial interest
37-68 consideration of at least a $1,000 value, consisting of any
37-69 tangible or intangible benefit to the real estate investment trust,
37-70 including cash, promissory notes, services performed for, contracts
38-1 for services to be performed for, or other securities of the real
38-2 estate investment trust <beneficial ownership is held by one
38-3 hundred (100) or more persons with no five (5) persons owning more
38-4 than fifty per cent (50%) of the total number of outstanding shares
38-5 of beneficial interest>, the real estate investment trust
38-6 manager(s) who assent thereto shall be jointly and severally liable
38-7 to the trust for the part of the required consideration that has
38-8 not been received before commencing business <all debts and
38-9 obligations incurred by the trust prior to the time the beneficial
38-10 ownership is so held>, but such liability shall be terminated when
38-11 the real estate investment trust has actually received the required
38-12 consideration for the issuance <issued the required number> of
38-13 shares.
38-14 (B) The trust manager(s) shall not be liable under
38-15 Subsection (A)(1) <Subsection 1 of paragraph (A)> of this Section
38-16 if, in the exercise of ordinary care, in good faith, in determining
38-17 the amount available for any such dividend or distribution, he (i)
38-18 considered the assets to be of their book value or (ii) relied on
38-19 information, opinions, reports, or statements, including financial
38-20 statements and other financial data, concerning the real estate
38-21 investment trust or another person, that were prepared or presented
38-22 by:
38-23 (a) one or more officers or employees of the
38-24 real estate investment trust, other than the trust manager;
38-25 (b) legal counsel, public accountants,
38-26 investment bankers, or other persons as to matters the trust
38-27 manager reasonably believes are within the person's professional or
38-28 expert competence; or
38-29 (c) a committee of the trust managers of which
38-30 the trust manager is not a member.
38-31 (C) A trust manager(s) shall not be liable for any claims or
38-32 damages that may result from his acts in the discharge of any duty
38-33 imposed or power conferred upon him by the real estate investment
38-34 trust, if, in the exercise of ordinary care, he acted in good faith
38-35 and in reliance upon information, opinions, reports, or statements,
38-36 including financial statements and other financial data, concerning
38-37 the real estate investment trust or another person, that were
38-38 prepared or presented by:
38-39 (1) one or more officers or employees of the real
38-40 estate investment trust, other than the real estate investment
38-41 trust manager;
38-42 (2) legal counsel, public accountants, investment
38-43 bankers, or other persons as to matters the trust manager
38-44 reasonably believes are within the person's professional or expert
38-45 competence; or
38-46 (3) a committee of the trust managers of which the
38-47 trust manager is not a member.
38-48 (D) A trust manager is not relying in good faith within the
38-49 meaning of this Section if the trust manager has knowledge
38-50 concerning the matter in question that makes reliance otherwise
38-51 permitted by this Section unwarranted <the written opinion of an
38-52 attorney for the trust>.
38-53 (E) <(D)> No trust manager shall be liable to the real
38-54 estate investment trust for any act, omission, loss, damage, or
38-55 expense arising from the performance of his duty under a real
38-56 estate investment trust, save only for his own wilful misfeasance,
38-57 wilful <or> malfeasance, or gross negligence.
38-58 (F) A trust manager found liable with respect to a claim is
38-59 entitled to receive contribution, as appropriate to achieve equity,
38-60 from each of the other trust managers who are liable with respect
38-61 to that claim.
38-62 (G) An action may not be brought against a trust manager for
38-63 liability imposed by this Section after two years after the date on
38-64 which the act alleged to give rise to the liability occurred.
38-65 <Sec. 16. ><Share as Personal Property><. A share of beneficial
38-66 ownership in a real estate investment trust shall be considered
38-67 personal property.>
38-68 Sec. 17.10 <17>. Joinder of Shareholders Not Required. The
38-69 joinder of shareholders in any sale, mortgage, lease, or other
38-70 disposition of all or any part of assets of a real estate
39-1 investment trust shall not be required.
39-2 Sec. 18.10 <18>. Books and Records. (A) Each real estate
39-3 investment trust shall keep complete and correct books of account
39-4 and shall keep minutes of the proceedings of its shareholders and
39-5 trust manager(s) and shall keep at its principal office or place of
39-6 business a record of its shareholders giving the names and
39-7 addresses of all shareholders and the number of shares held by
39-8 each.
39-9 (B) Any person who shall have been a shareholder of record
39-10 for at least six (6) months immediately preceding his demand, or
39-11 who shall be the holder of record of at least five per cent (5%) of
39-12 all the outstanding shares of a real estate investment trust, upon
39-13 written demand stating the purpose thereof, shall have the right to
39-14 examine, in person or by agent or attorney, at any reasonable time
39-15 or times, for any proper purpose, its books and records of account,
39-16 minutes and record of shareholders, and shall be entitled to make
39-17 extracts therefrom.
39-18 (C) Nothing herein contained shall impair the power of any
39-19 court of competent jurisdiction, upon proof by a shareholder of
39-20 proper purpose, irrespective of the period of time during which
39-21 such shareholder shall have been a shareholder of record, and
39-22 irrespective of the number of shares held by him, to compel
39-23 production, for examination by such shareholder, of the books and
39-24 records of account, minutes, and record of shareholders of a real
39-25 estate investment trust.
39-26 <Sec. 19. ><Transfer of Shares><. The shares of ownership shall
39-27 be transferable by an appropriate instrument in writing and by the
39-28 surrender of the shares of ownership to the trust manager(s) or to
39-29 the persons designated by them, but no transfer shall be of any
39-30 effect as against the trust of the trust manager(s) until it has
39-31 been recorded upon the books of the trust kept for that purpose.>
39-32 Sec. 19.10 <20>. Termination and liquidation. A real estate
39-33 investment trust may be dissolved by the affirmative vote of the
39-34 holders of at least two-thirds (2/3) of the outstanding voting
39-35 shares of the real estate investment trust, unless any class or
39-36 series of shares is entitled to vote as a class on the dissolution,
39-37 in which case the resolution shall require for its adoption the
39-38 affirmative vote of the holders of at least two-thirds of the
39-39 outstanding shares within each class or series of shares entitled
39-40 to vote as a class on the dissolution and at least two-thirds of
39-41 the outstanding shares otherwise entitled to vote on the
39-42 dissolution. Shares entitled to vote as a class shall be entitled
39-43 to vote only as a class unless otherwise entitled to vote on each
39-44 matter generally or provided in the declaration of trust. Upon
39-45 receiving such vote, the trust manager(s) shall liquidate the real
39-46 estate investment trust and distribute the remaining property and
39-47 assets of the real estate investment trust among its shareholders
39-48 in accordance with their respective rights and interests after
39-49 applying such property as far as it will go to the just and
39-50 equitable payment of the liabilities and obligations of the real
39-51 estate investment trust. Upon the filing by the trust manager(s)
39-52 of a withdrawal of assumed name certificate as provided by law, the
39-53 real estate investment trust shall cease to carry on its business,
39-54 except insofar as may be necessary for the winding up thereof.
39-55 <Sec. 21. ><Greater Voting Requirements><. Whenever, with
39-56 respect to any action taken by the shareholders of a trust, the
39-57 declaration of trust requires the vote or concurrence of the
39-58 holders of a greater portion of the shares than is required by this
39-59 Act, with respect to such action, the provisions of the declaration
39-60 of trust shall control.>
39-61 Sec. 21.10 <22>. Waiver of Notice. Whenever any notice is
39-62 required to be given to any shareholder of a real estate investment
39-63 trust under the provisions of this Act or under the provisions of
39-64 the declaration of trust or bylaws <by-laws> of the real estate
39-65 investment trust, a waiver thereof in writing, signed by the person
39-66 or persons entitled to such notice, whether before or after the
39-67 time stated therein, shall be equivalent to the giving of such
39-68 notice.
39-69 Sec. 22.10 <23>. Right to Amend Declaration of Trust.
39-70 (A) A real estate investment trust may amend its declaration of
40-1 trust, from time to time, in any and as many respects as may be
40-2 desired, so long as its declaration of trust as amended contains
40-3 only such provisions as may be lawfully contained in original
40-4 declaration of trust at the time of making such amendment, and, if
40-5 a change in shares or the rights of shareholders, or an exchange,
40-6 reclassification, or cancellation of shares or rights of
40-7 shareholders is to be made, such provisions as may be necessary to
40-8 effect such change, exchange, reclassification or cancellation.
40-9 <The declaration of trust may be amended upon receipt of the
40-10 affirmative vote of the holders of at least two-thirds (2/3) of the
40-11 outstanding shares of the trust. Any and all amendments to the
40-12 declaration of trust shall be made of record in the same manner as
40-13 the original declaration of trust.>
40-14 (B) A shareholder of a real estate investment trust does not
40-15 have a vested property right resulting from any provision in the
40-16 declaration of trust, including a provision relating to management,
40-17 control, capital structure, dividend entitlement, or purpose or
40-18 duration of the real estate investment trust.
40-19 Sec. 22.20. PROCEDURE TO AMEND DECLARATION OF TRUST.
40-20 (A) The declaration of trust may be amended in the following
40-21 manner:
40-22 (1) The trust manager(s) shall adopt a resolution
40-23 setting forth the proposed amendment and, if shares have been
40-24 issued, directing that the amendment be submitted to a vote at an
40-25 annual or special meeting of shareholders. If no shares have been
40-26 issued, the amendment shall be adopted by resolution of the trust
40-27 manager(s) and the provisions for adoption by shareholders may not
40-28 apply. The resolution may incorporate the proposed amendment in a
40-29 restated declaration of trust that contains a statement that except
40-30 for the designated amendment the restated declaration of trust
40-31 correctly sets forth without change the corresponding provisions of
40-32 the original declaration of trust, and that the restated
40-33 declaration of trust together with the designated amendment
40-34 supersedes the original declaration of trust and all amendments to
40-35 the original declaration of trust.
40-36 (2) Written or printed notice setting forth the
40-37 proposed amendment or a summary of the changes to be effected by
40-38 the proposed amendment shall be given to each shareholder of record
40-39 entitled to vote on the proposed amendment within the time and in
40-40 the manner provided in this Act for giving notice of meetings of
40-41 shareholders. If the meeting is an annual meeting, the proposed
40-42 amendment or the summary of the changes may be included in the
40-43 notice of the annual meeting.
40-44 (3) At the meeting, a vote of the shareholders
40-45 entitled to vote on the proposed amendment shall be taken on the
40-46 proposed amendment. The proposed amendment is adopted on receiving
40-47 the affirmative vote of the holders of at least two-thirds (2/3) of
40-48 the outstanding shares entitled to vote on the proposed amendment,
40-49 unless any class or series of shares is entitled to vote on the
40-50 proposed amendment as a class, in which case the proposed amendment
40-51 shall be adopted on receiving the affirmative vote of the holders
40-52 of at least two-thirds (2/3) of the shares within each class or
40-53 series of outstanding shares entitled to vote on the proposed
40-54 amendment as a class and of at least two-thirds (2/3) of the total
40-55 outstanding shares entitled to vote on the proposed amendment.
40-56 (B) Any number of amendments may be submitted to and voted
40-57 on by the shareholders at one meeting.
40-58 Sec. 22.30. CLASS VOTING ON AMENDMENTS. (A) The holders of
40-59 the outstanding shares of a class shall be entitled to vote as a
40-60 class on a proposed amendment, and the holders of the outstanding
40-61 shares of a series shall be entitled to vote as a class on a
40-62 proposed amendment, whether or not entitled to vote on the proposed
40-63 amendment by the provisions of the declaration of trust, if the
40-64 amendment would accomplish any of the following, unless the
40-65 amendment is undertaken pursuant to authority granted to the trust
40-66 manager(s) in the declaration of trust in accordance with Section
40-67 3.30 of this Act:
40-68 (1) Increase or decrease the aggregate number of
40-69 authorized shares of such class or series.
40-70 (2) Increase or decrease the par value of the shares
41-1 of such class, including changing shares having a par value into
41-2 shares without par value, or shares without par value into shares
41-3 with par value.
41-4 (3) Effect an exchange, reclassification, or
41-5 cancellation of all or part of the shares of such class or series.
41-6 (4) Effect an exchange, or create a right of exchange,
41-7 of all or any part of the shares of another class into the shares
41-8 of such class or series.
41-9 (5) Change the designations, preferences, limitations,
41-10 or relative rights of the shares of such class or series.
41-11 (6) Change the shares of such class or series, whether
41-12 with or without par value, into the same or a different number of
41-13 shares, either with or without par value, of the same class or
41-14 series or another class or series.
41-15 (7) Create a new class or series of shares having
41-16 rights and preferences equal, prior, or superior to the shares of
41-17 the class or series, or increase the rights and preferences of any
41-18 class or series having rights and preferences equal, prior, or
41-19 superior to the shares of the class or series, or increase the
41-20 rights and preferences of any class or series having rights or
41-21 preferences later or inferior to the shares of the class or series
41-22 in such a manner as to become equal, prior, or superior to the
41-23 shares of the class or series.
41-24 (8) Divide the shares of the class into series and fix
41-25 and determine the designation of the series and the variations in
41-26 the relative rights and preferences between the shares of the
41-27 series.
41-28 (9) Limit or deny the existing preemptive rights of
41-29 the shares of the class or series, if the rights have previously
41-30 been granted pursuant to this Act.
41-31 (10) Cancel or otherwise affect dividends on the
41-32 shares of the class or series that had accrued but had not been
41-33 declared.
41-34 (B) Unless otherwise provided in a real estate investment
41-35 trust's declaration of trust, if the holders of the outstanding
41-36 shares of a class that is divided into series are entitled to vote
41-37 as a class on a proposed amendment and the amendment would affect
41-38 all series of the class (other than any series of which no shares
41-39 are outstanding or any series that is not affected by the
41-40 amendment) equally, the holders of the separate series are not
41-41 entitled to separate class votes.
41-42 (C) Unless otherwise provided in a real estate investment
41-43 trust's declaration of trust, a proposed amendment to the real
41-44 estate investment trust's declaration of trust that would solely
41-45 effect changes in the designations, preferences, limitations, or
41-46 relative rights, including voting rights, of one or more series of
41-47 shares of the real estate investment trust that have been
41-48 established pursuant to the authority granted the trust manager(s)
41-49 in the declaration of trust in accordance with this Act does not
41-50 require the approval of the holders of the outstanding shares of
41-51 any class or series other than that series if the preferences,
41-52 limitations and relative rights of that series after giving effect
41-53 to the amendment and of any series that may be established as a
41-54 result of a reclassification of that series are, in each case,
41-55 within those permitted to be fixed and determined by the trust
41-56 manager(s) with respect to the establishment of any new series of
41-57 shares pursuant to the authority granted to the trust manager(s) in
41-58 the declaration of trust in accordance with this Act.
41-59 Sec. 22.40. ARTICLES OF AMENDMENT. (A) An officer shall
41-60 execute the articles of amendment on behalf of the real estate
41-61 investment trust. If no shares have been issued, and the articles
41-62 of amendment are adopted by the trust manager(s), a majority of the
41-63 trust manager(s) may execute the articles of amendment on behalf of
41-64 the real estate investment trust.
41-65 (B) The articles of amendment shall set forth:
41-66 (1) The name of the real estate investment trust.
41-67 (2) If the amendment alters any provision of the
41-68 original or amended declaration of trust, an identification by
41-69 reference or description of the altered provision and a statement
41-70 of its text as it is amended to read. If the amendment is an
42-1 addition to the original or amended declaration of trust, a
42-2 statement of that fact and the full text of each added provision.
42-3 (3) The date of the adoption of the amendment by the
42-4 shareholders, or by the trust manager(s), where no shares have been
42-5 issued.
42-6 (4) The number of shares outstanding, and the number
42-7 of shares entitled to vote on the amendment, and if the shares of
42-8 any class or series are entitled to vote on the amendment as a
42-9 class, the designation and number of outstanding shares entitled to
42-10 vote on the amendment of each such class or series.
42-11 (5) The number of shares voted for and against the
42-12 amendment, respectively, and, if the shares of any class are
42-13 entitled to vote on the amendment as a class or series, the number
42-14 of shares of each such class or series voted for and against the
42-15 amendment, respectively, or if no shares have been issued, a
42-16 statement to that effect.
42-17 (6) If the amendment provides for an exchange,
42-18 reclassification, or cancellation of issued shares, and if the
42-19 manner in which the exchange, reclassification, or cancellation of
42-20 issued shares shall be effected is not set forth in the amendment,
42-21 then a statement of the manner in which the exchange,
42-22 reclassification, or cancellation of the issued shares shall be
42-23 effected.
42-24 (7) If the amendment effects a change in the amount of
42-25 stated capital, then a statement of the manner in which the change
42-26 in the amount of stated capital is effected and a statement,
42-27 expressed in dollars, of the amount of stated capital as changed by
42-28 the amendment.
42-29 Sec. 22.50. FILING OF ARTICLES OF AMENDMENT. A copy of the
42-30 articles of amendment shall be filed with the county clerk of the
42-31 county of the principal place of business of the real estate
42-32 investment trust.
42-33 Sec. 22.60. EFFECT OF CERTIFICATE OF AMENDMENT. (A) On the
42-34 filing of the articles of amendment with the county clerk of the
42-35 county of the principal place of business of the real estate
42-36 investment trust, the amendment becomes effective and the
42-37 declaration of trust is considered to be amended accordingly.
42-38 (B) An amendment may not affect any existing cause of action
42-39 in favor of or against the real estate investment trust, or any
42-40 pending suit to which the real estate investment trust is a party,
42-41 or the existing rights of persons other than shareholders. If the
42-42 name of a real estate investment trust is changed by amendment, a
42-43 suit brought by or against the real estate investment trust under
42-44 its former name may not be abated for that reason.
42-45 Sec. 22.70. RESTATED DECLARATION OF TRUST. (A) A real
42-46 estate investment trust, by following the procedure to amend the
42-47 declaration of trust provided by this Act (except that no
42-48 shareholder approval shall be required where no amendment is made),
42-49 may authorize, execute, and file a restated declaration of trust
42-50 that may restate:
42-51 (1) the entire text of the declaration of trust as
42-52 amended or supplemented by all articles of amendment previously
42-53 filed with the county clerk of the county of the principal place of
42-54 business of the real estate investment trust; or
42-55 (2) the entire text of the declaration of trust as
42-56 amended or supplemented by all articles of amendment previously
42-57 filed with the county clerk of the county of the principal place of
42-58 business of the real estate investment trust, and as further
42-59 amended by the restated declaration of trust.
42-60 (B) If the restated declaration of trust restates the entire
42-61 declaration of trust, as amended and supplemented by all articles
42-62 of amendment previously filed with the county clerk of the county
42-63 of the principal place of business of the real estate investment
42-64 trust, without making any further amendment to the declaration of
42-65 trust, the introductory paragraph shall contain a statement that
42-66 the instrument accurately copies the declaration of trust and all
42-67 amendments to the declaration of trust that are in effect on that
42-68 date and that the instrument contains no change in any provision of
42-69 the declaration of trust. The number of trust manager(s) and the
42-70 names and addresses of the persons serving as trust manager(s) may
43-1 be inserted in lieu of similar information concerning the initial
43-2 trust manager(s).
43-3 (C) If the restated declaration of trust restates the entire
43-4 declaration of trust, as amended and supplemented by all articles
43-5 of amendment previously filed with the county clerk of the county
43-6 of the principal place of business of the real estate investment
43-7 trust, and as further amended by the restated declaration of trust,
43-8 the instrument containing the declaration of trust shall:
43-9 (1) Set forth, for any amendment made by the restated
43-10 declaration of trust, a statement that the amendment has been
43-11 effected in conformity with the provisions of this Act, and the
43-12 statements required by this Act to be contained in articles of
43-13 amendment.
43-14 (2) Contain a statement that the instrument accurately
43-15 copies the declaration of trust and all amendments to the
43-16 declaration of trust that are in effect on that date and as further
43-17 amended by the restated declaration of trust and that the
43-18 instrument contains no other change in any provision in the
43-19 declaration of trust; provided that the number of trust manager(s)
43-20 and the names and addresses of the persons serving as trust
43-21 manager(s) may be inserted in lieu of similar information
43-22 concerning the initial trust manager(s).
43-23 (3) Restate the text of the entire declaration of
43-24 trust as amended and supplemented by all articles of amendment
43-25 previously filed with the county clerk of the county of the
43-26 principal place of business of the real estate investment trust and
43-27 as further amended by the restated declaration of trust.
43-28 (D) An officer shall execute the restated declaration of
43-29 trust on behalf of the real estate investment trust. If no shares
43-30 have been issued and the restated declaration of trust is adopted
43-31 by the trust manager(s), a majority of the trust manager(s) may
43-32 execute the restated declaration of trust on behalf of the real
43-33 estate investment trust.
43-34 (E) On the filing of the copy of the restated declaration of
43-35 trust with the county clerk of the county of the principal place of
43-36 business of the real estate investment trust, the original
43-37 declaration of trust and all amendments to the original declaration
43-38 of trust shall be superseded and the restated declaration of trust
43-39 is considered to be the declaration of trust of the real estate
43-40 investment trust.
43-41 Sec. 23.10 <23.1>. MERGER. (A) A domestic real estate
43-42 investment trust may adopt a plan of merger and one or more
43-43 domestic real estate investment trusts may merge with one or more
43-44 domestic or foreign corporations, real estate investment trusts,
43-45 partnerships or other entities if:
43-46 (1) the trust manager(s) of each domestic real estate
43-47 investment trust that is a party to the plan of merger act on, and
43-48 its shareholders (if required by Section 23.30 of this Act)
43-49 approve, the plan of merger in the manner prescribed in Section
43-50 23.30 of this Act;
43-51 (2)(i) the merger is permitted by the laws of the
43-52 state or country under whose law each foreign corporation, if any,
43-53 that is a party to the merger is incorporated, (ii) the merger is
43-54 either permitted by the laws under which each other entity that is
43-55 a party to the merger is organized or by the constituent documents
43-56 of the other entity that are not inconsistent with those laws, and
43-57 (iii) each foreign corporation, real estate investment trust,
43-58 partnership or other entity that is a party to the merger complies
43-59 with those laws or documents in effecting the merger, if one or
43-60 more foreign corporations, real estate investment trusts,
43-61 partnerships or other entities is a party to the merger or is to be
43-62 created by the terms of the plan of merger; and
43-63 (3) no shareholder of a domestic real estate
43-64 investment trust that is a party to the merger will, as a result of
43-65 the merger, become personally liable, without the shareholder's
43-66 consent, for the liabilities or obligations of any other person or
43-67 entity.
43-68 (B) A plan of merger shall set forth:
43-69 (1) the name of each domestic or foreign corporation,
43-70 real estate investment trust, partnership or other entity that is a
44-1 party to the merger and the name of each domestic or foreign
44-2 corporation, real estate investment trust, partnership or other
44-3 entity, if any, that shall survive the merger, which may be one or
44-4 more of the domestic or foreign corporations, real estate
44-5 investment trusts, partnerships or other entities that are a party
44-6 to the merger, and the name of each new domestic or foreign
44-7 corporation, real estate investment trust, partnership or other
44-8 entity, if any, that may be created by the terms of the plan of
44-9 merger;
44-10 (2) the terms and conditions of the merger including
44-11 the following, if more than one domestic or foreign corporation,
44-12 real estate investment trust, partnership or other entity is to
44-13 survive or to be created by the terms of the plan of merger:
44-14 (a) the manner and basis of allocating and
44-15 vesting the real estate and other property of each domestic or
44-16 foreign real estate investment trust and of each other entity that
44-17 is a party to the merger among one or more of the surviving or new
44-18 domestic or foreign corporations, real estate investment trusts,
44-19 partnerships and other entities;
44-20 (b) the name of the surviving or new domestic or
44-21 foreign corporation, real estate investment trust, partnership or
44-22 other entity that is to be obligated for the payment of the fair
44-23 value of any shares held by a shareholder of any domestic real
44-24 estate investment trust that is a party to the merger who has
44-25 complied with the requirements of Section 25.20 of this Act; and
44-26 (c) the manner and basis of allocating all other
44-27 liabilities and obligations of each domestic or foreign
44-28 corporation, real estate investment trust, partnership and other
44-29 entity that is a party to the merger (or making adequate provision
44-30 for the payment and discharge thereof) among one or more of the
44-31 surviving or new domestic or foreign corporations, real estate
44-32 investment trusts, partnerships and other entities;
44-33 (3) the manner and basis of converting any of the
44-34 shares or other evidence of ownership of each domestic or foreign
44-35 corporation, real estate investment trust, partnership and other
44-36 entity that is a party to the merger into shares, obligations,
44-37 evidences of ownership, rights to purchase securities or other
44-38 securities of one or more of the surviving or new domestic or
44-39 foreign corporations, real estate investment trusts, partnerships
44-40 or other entities, into cash or other property, including shares,
44-41 obligations, evidences of ownership, rights to purchase securities
44-42 or other securities of any other person or entity, or into any
44-43 combination of the foregoing; and
44-44 (4) the declaration of trust, articles of
44-45 incorporation, partnership agreement, or other organizational
44-46 documents of each real estate investment trust, corporation,
44-47 partnership or other entity that is a party to the merger and that
44-48 is to survive the merger or is to be created by the terms of the
44-49 plan of merger.
44-50 (C) The plan of merger may set forth:
44-51 (1) any amendments to the organizational documents of
44-52 any surviving entity;
44-53 (2) provisions relating to a share exchange; and
44-54 (3) any other provisions relating to the merger.
44-55 (D) On the merger's taking effect, the surviving or new
44-56 foreign corporation, real estate investment trust, partnership or
44-57 other entity, if any, that is the sole surviving or new foreign
44-58 corporation, real estate investment trust, partnership or other
44-59 entity in the merger, or if more than one domestic or foreign
44-60 corporation, real estate investment trust, partnership or other
44-61 entity is to survive or to be created by the terms of the plan of
44-62 the merger, the surviving or new foreign corporation, real estate
44-63 investment trust, partnership or other entity that is designated in
44-64 the plan of merger to be the entity obligated for the payment of
44-65 the fair value of any shares held by a shareholder who has complied
44-66 with the requirements of Section 25.20 of this Act for the recovery
44-67 of the fair value of the shareholder's shares, is considered to:
44-68 (1) appoint the Secretary of State in this state as
44-69 its agent for service of process in a proceeding to enforce any
44-70 obligation or the rights of dissenting shareholders of each
45-1 domestic entity that is a party to the merger; and
45-2 (2) agree that it will promptly pay to the dissenting
45-3 shareholders of each domestic entity that is a party to the merger
45-4 the amount, if any, to which the dissenting shareholders are
45-5 entitled under Section 25.10 of this Act.
45-6 (E) This Section does not limit the power of a domestic or
45-7 foreign corporation, real estate investment trust, partnership or
45-8 other entity to acquire all or part of the shares of one or more
45-9 classes or series of a domestic real estate investment trust
45-10 through a voluntary exchange or otherwise.
45-11 (F) This Section does not limit the power of domestic or
45-12 foreign subsidiary entities to merge into a parent pursuant to
45-13 applicable law <Definitions. In this Section the following words
45-14 have the meanings indicated.>
45-15 <(1) "Business trust" means an unincorporated trust or
45-16 association, including a Texas real estate investment trust, a
45-17 common-law trust, or a Massachusetts trust, which is engaged in
45-18 business and in which property is acquired, held, managed,
45-19 administered, controlled, invested, or disposed of by trust
45-20 managers or trustees for the benefit and profit of any person who
45-21 may become a holder of a transferable unit of beneficial interest
45-22 in the trust.>
45-23 <(2) "Foreign business trust" means a business trust
45-24 organized under the laws of the United States, another state of the
45-25 United States, or a territory, possession, or district of the
45-26 United States.>
45-27 <(3) "Texas real estate investment trust" means a real
45-28 estate investment trust formed under the provisions of this Act.>
45-29 <(B) Merger authorized. Unless the declaration of trust
45-30 provides otherwise, a Texas real estate investment trust may merge
45-31 into a Texas or foreign business trust or into a Texas or foreign
45-32 corporation having capital stock, or one or more such business
45-33 trusts or such corporations may merge into it.>
45-34 <(C) Approval generally; exceptions. A merger shall be
45-35 approved in the manner provided by this Section, except that:>
45-36 <(1) A foreign business trust, a Texas business trust,
45-37 other than a Texas real estate investment trust, or a corporation
45-38 party to the merger shall have the merger advised, authorized, and
45-39 approved in the manner and by the vote required by its declaration
45-40 of trust or charter and the laws of the place where it is
45-41 organized; and>
45-42 <(2) A merger need be approved by a Texas real estate
45-43 investment trust successor only by a majority of its trust managers
45-44 if:>
45-45 <(a) The merger does not reclassify or change
45-46 its outstanding shares or otherwise amend its declaration of trust;
45-47 and>
45-48 <(b) The number of shares to be issued or
45-49 delivered in the merger is not more than fifteen per cent (15%) of
45-50 the number of its shares of the same class or series outstanding
45-51 immediately before the merger becomes effective.>
45-52 <(D) Trust managers' actions. The trust managers of each
45-53 Texas real estate investment trust proposing to merge shall:>
45-54 <(1) Adopt a resolution that declares the proposed
45-55 transaction is advisable on substantially the terms and conditions
45-56 set forth or referred to in the resolution; and>
45-57 <(2) Direct that the proposed transaction be submitted
45-58 for consideration at either an annual or special meeting of
45-59 shareholders.>
45-60 <(E) Notice to shareholders. Notice which states that a
45-61 purpose of a meeting will be to act upon the proposed merger shall
45-62 be given by each Texas real estate investment trust in the manner
45-63 provided for corporations by Article 5.03 of the Texas Business
45-64 Corporation Act to:>
45-65 <(1) Each of its shareholders entitled to vote on the
45-66 proposed transaction; and>
45-67 <(2) Each of its shareholders not entitled to vote on
45-68 the proposed transaction, except the shareholders of a successor in
45-69 a merger if the merger does not alter the contract rights of their
45-70 shares as expressly set forth in the declaration of trust.>
46-1 <(F) Shareholders' approval. The proposed merger shall be
46-2 approved by the shareholders of each Texas real estate investment
46-3 trust by the affirmative vote of two-thirds (2/3) of all the votes
46-4 entitled to be cast on the matter.>
46-5 <(G) Articles of merger. Articles of merger containing
46-6 provisions required by Article 5.04 of the Texas Business
46-7 Corporation Act and such other provisions as may be permitted by
46-8 that Article shall be:>
46-9 <(1) Executed for each party to the articles in the
46-10 manner required by this Section or by Part Five of the Texas
46-11 Business Corporation Act; and>
46-12 <(2) Filed for the record with the secretary of state
46-13 in the manner required by Part Five of the Texas Business
46-14 Corporation Act and filed with the county clerk in each county
46-15 where the principal place of business of a Texas real estate
46-16 investment trust which is a party to the merger is located.>
46-17 <(H) Abandonment of proposed merger. (1) A proposed merger
46-18 may be abandoned before the effective date of the articles:>
46-19 <(a) If the articles so provide, by majority
46-20 vote of the trust manager(s) of any one business trust party to the
46-21 articles or of the entire board of directors of any one corporation
46-22 party to the articles; or>
46-23 <(b) Unless the articles provide otherwise, by
46-24 majority vote of the trust manager(s) of each Texas real estate
46-25 investment trust party to the articles.>
46-26 <(2) If the articles have been filed with the county
46-27 clerk and the secretary of state, notice of the abandonment shall
46-28 be given promptly to such parties.>
46-29 <(3)(a) If the proposed merger is abandoned as
46-30 provided in this subdivision, no legal liability arises under the
46-31 articles.>
46-32 <(b) An abandonment does not prejudice the
46-33 rights of any person under any other contract made by a business
46-34 trust or a corporation party to the proposed articles in connection
46-35 with the proposed merger.>
46-36 <(I) Dissenting shareholders. Each shareholder of a Texas
46-37 real estate investment trust dissenting to a merger of the Texas
46-38 real estate investment trust shall have the same rights as a
46-39 dissenting shareholder of a Texas corporation under Part Five of
46-40 the Texas Business Corporation Act and under the same procedures.>
46-41 <(J) Certificates of merger. (1) The secretary of state
46-42 shall prepare certificates of merger which specify:>
46-43 <(a) The name of each party to the articles;>
46-44 <(b) The name of the successor and the location
46-45 of its principal office in this state or, if it has none, its
46-46 principal place of business; and>
46-47 <(c) The time the articles are accepted for
46-48 record by the secretary of state.>
46-49 <(2) In addition to any other provision of law with
46-50 respect to recording, the secretary of state shall send one of the
46-51 certificates to the successor entity in the merger, and such
46-52 successor shall send a copy of the certificate to the county clerk
46-53 in each county where the principal place of business of a Texas
46-54 real estate investment trust which was a party to the merger is
46-55 located.>
46-56 <(3) On receipt of the certificate, each such county
46-57 clerk promptly shall record it with the declaration of trust to
46-58 which such articles of merger relate.>
46-59 <(k) Time merger effective. (1) Texas real estate
46-60 investment trust successor. If the successor in a merger is a
46-61 Texas real estate investment trust, a merger is effective as of the
46-62 time the secretary of state accepts the articles of merger for
46-63 record.>
46-64 <(2) Successor other than Texas real estate investment
46-65 trust. (a) If the successor in a merger is a Texas or foreign
46-66 corporation or a Texas or foreign business trust, other than a
46-67 Texas real estate investment trust, the merger is effective as of
46-68 the later of:>
46-69 <(i) The time specified by the law of the
46-70 place where the successor is organized; or>
47-1 <(ii) The time the secretary of state
47-2 accepts the articles of merger for record.>
47-3 <(b) A foreign successor in a merger shall file
47-4 for record with the secretary of state a certificate from the place
47-5 where it is organized which certifies the date the articles of
47-6 merger were filed. However, the failure to file this certificate
47-7 does not invalidate the merger.>
47-8 <(L) Effect of merger. (1) Consummation of a merger has
47-9 the effects provided in this Subsection.>
47-10 <(2) The separate existence of each business trust and
47-11 corporation party to the articles, except the successor, ceases.>
47-12 <(3) The shares of each business trust party to the
47-13 articles which are to be converted or exchanged under the terms of
47-14 the articles cease to exist, subject to the rights of a dissenting
47-15 shareholder under Subsection (I) of this Section.>
47-16 <(4) In addition to any other purposes and powers set
47-17 forth in the articles, if the articles provide, the successor has
47-18 the purposes and powers of each party to the articles.>
47-19 <(5)(a) The assets of each party to the articles,
47-20 including any legacies which it would have been capable of taking,
47-21 transfer to, vest in, and devolve on the successor without further
47-22 act or deed.>
47-23 <(b) Confirmatory deeds, assignments, or similar
47-24 instruments to evidence the transfer may be executed and delivered
47-25 at any time in the name of the transferring party to the articles
47-26 by its last acting officers or trustees or by the appropriate
47-27 officers or trustees of the successor.>
47-28 <(6)(a) The successor is liable for all the debts and
47-29 obligations of each nonsurviving party to the articles. An
47-30 existing claim, action, or proceeding pending by or against any
47-31 nonsurviving party to the articles may be prosecuted to judgment as
47-32 if the merger had not taken place, or, on motion of the successor
47-33 or any party, the successor may be substituted as a party and the
47-34 judgment against the nonsurviving party to the articles constitutes
47-35 a lien on the property of the successor.>
47-36 <(b) A merger does not impair the rights of
47-37 creditors or any liens on the property of any business trust or
47-38 corporation party to the articles>.
47-39 Sec. 23.20. SHARE EXCHANGE OR ACQUISITION. (A) One or more
47-40 domestic or foreign corporations, real estate investment trusts,
47-41 partnerships or other entities may acquire all of the outstanding
47-42 shares of one or more classes or series of one or more domestic
47-43 real estate investment trusts if:
47-44 (1) the trust manager(s) of each domestic real estate
47-45 investment trust that is a party to the plan of exchange acts on a
47-46 plan of exchange in the manner prescribed by Section 23.30 of this
47-47 Act and its shareholders (if required by Section 23.30 of this Act)
47-48 approve the plan of exchange;
47-49 (2) the issuance of shares or interests issued as part
47-50 of the plan of exchange is either permitted by the laws under which
47-51 the foreign corporations, real estate investment trusts,
47-52 partnerships or other entities are incorporated or organized or not
47-53 inconsistent with those laws, if one or more foreign corporations,
47-54 real estate investment trusts, partnerships or other entities are
47-55 to issue shares or other interests as part of the plan of exchange;
47-56 and
47-57 (3) each acquiring domestic or foreign corporation,
47-58 real estate investment trust, partnership or other entity takes all
47-59 action that may be required by the laws of the state or country
47-60 under which the entity was incorporated or organized and by its
47-61 constituent documents to effect the exchange.
47-62 (B) A plan of exchange must set forth:
47-63 (1) the name of the real estate investment trust or
47-64 trusts whose shares will be acquired and the name of each acquiring
47-65 domestic or foreign corporation, real estate investment trust,
47-66 partnership or other entity;
47-67 (2) the terms and conditions of the exchange
47-68 including, if there is more than one acquiring domestic or foreign
47-69 corporation, real estate investment trust, partnership or other
47-70 entity, the shares to be acquired by each such entity; and
48-1 (3) the manner and basis of exchanging the shares to
48-2 be acquired for shares, obligations, evidences of ownership, rights
48-3 to purchase securities or other securities of one or more of the
48-4 acquiring domestic or foreign corporations, real estate investment
48-5 trusts, partnerships or other entities that are parties to the plan
48-6 of exchange, or for cash or other property, including shares,
48-7 obligations, evidences of ownership, rights to purchase securities
48-8 or other securities of any other person or entity, or for any
48-9 combination of the foregoing.
48-10 (C) The plan of exchange may set forth any other provisions
48-11 relating to the exchange and may be contained in and be a part of a
48-12 plan of merger.
48-13 (D) A plan of exchange may not be effected if any
48-14 shareholder of a domestic real estate investment trust that is a
48-15 party to the share exchange will, as a result of the share
48-16 exchange, become personally liable, without the shareholder's
48-17 consent, for the liabilities or obligations of any other person or
48-18 entity.
48-19 (E) This Section does not limit the power of a domestic or
48-20 foreign corporation, real estate investment trust, partnership or
48-21 other entity to acquire all or part of the shares of one or more
48-22 classes or series of a domestic real estate investment trust
48-23 through a voluntary exchange or otherwise.
48-24 Sec. 23.30. ACTION ON PLAN OF MERGER OR EXCHANGE.
48-25 (A) Except as provided by Subsection (G) of this Section, after
48-26 acting on a plan of merger or exchange in the manner prescribed by
48-27 Subdivision (1) of Subsection (B) of this Section, the trust
48-28 manager(s) of each domestic real estate investment trust that is a
48-29 party to the merger, and the trust manager(s) of each domestic real
48-30 estate investment trust whose shares are to be acquired in the
48-31 share exchange, shall submit the plan of merger or exchange for
48-32 approval by its shareholders.
48-33 (B) Except as provided by Subsection (G) of this Section,
48-34 for a plan of merger or exchange to be approved:
48-35 (1) the trust manager(s) of the real estate investment
48-36 trust may adopt a resolution recommending that the plan of merger
48-37 or exchange be approved by the shareholders of the real estate
48-38 investment trust, unless the trust manager(s) determines that for
48-39 any reason the trust manager(s) should not make that
48-40 recommendation, in which case the trust manager(s) may adopt a
48-41 resolution directing that the plan of merger or exchange be
48-42 submitted to shareholders for approval without recommendation and,
48-43 in connection with the submission, communicate the basis for the
48-44 trust manager's determination that the plan be submitted to
48-45 shareholders without any recommendation; and
48-46 (2) the shareholders entitled to vote on the plan of
48-47 merger or exchange must approve the plan.
48-48 (C) The trust manager(s) may condition the trust manager's
48-49 submission to shareholders of a plan of merger or exchange on any
48-50 basis.
48-51 (D) The real estate investment trust shall notify each
48-52 shareholder, whether or not the shareholder is entitled to vote, of
48-53 the meeting of shareholders at which the plan of merger or exchange
48-54 is to be submitted for approval in accordance with Section 11.10 of
48-55 this Act. The notice shall be given at least 20 days before the
48-56 meeting and shall state that the purpose, or one of the purposes,
48-57 of the meeting is to consider the plan of merger or exchange and
48-58 shall contain or be accompanied by a copy or summary of the plan.
48-59 (E) Unless the trust manager(s) (acting pursuant to
48-60 Subsection (C) of this Section) requires a greater vote or a vote
48-61 by class or series, the vote of shareholders required for approval
48-62 of a plan of merger or exchange shall be the affirmative vote of
48-63 the holders of at least two-thirds (2/3) of the outstanding shares
48-64 of each real estate investment trust entitled to vote on the plan
48-65 of merger or exchange, unless any class or series of shares of any
48-66 such real estate investment trust is entitled to vote as a class on
48-67 the plan of merger or exchange, in which event the vote required
48-68 for approval by the shareholders of the real estate investment
48-69 trust shall be the affirmative vote of the holders of at least
48-70 two-thirds (2/3) of the outstanding shares otherwise entitled to
49-1 vote on the plan of merger or exchange as a class and at least
49-2 two-thirds (2/3) of the outstanding shares otherwise entitled to
49-3 vote on the plan of merger or exchange. Shares entitled to vote as
49-4 a class shall be entitled to vote only as a class unless otherwise
49-5 entitled to vote on each matter submitted to the shareholders
49-6 generally or as provided in the declaration of trust.
49-7 (F) Separate voting by a class or series of shares of a
49-8 declaration of trust shall be required:
49-9 (1) for approval of a plan of merger if:
49-10 (a) the plan contains a provision that if
49-11 contained in a proposed amendment to the declaration of trust would
49-12 require approval by that class or series of shares under Section
49-13 22.30 of this Act; or
49-14 (b) that class or series of shares is entitled
49-15 under the declaration of trust to vote as a class on the plan of
49-16 merger or exchange; and
49-17 (2) on a plan of exchange if:
49-18 (a) shares of that class or series are to be
49-19 exchanged pursuant to the terms of the plan, or
49-20 (b) that class or series is entitled under the
49-21 declaration of trust to vote as a class on the plan of merger or
49-22 exchange.
49-23 (G) Unless the declaration of trust otherwise requires,
49-24 approval by the shareholders of a real estate investment trust on a
49-25 plan of merger is not required and Subsections (A) through (F) of
49-26 this Section do not apply if:
49-27 (1) the real estate investment trust is the sole
49-28 surviving real estate investment trust in the merger;
49-29 (2) the declaration of trust of the real estate
49-30 investment trust will not differ from its declaration of trust
49-31 before the merger;
49-32 (3) each shareholder of the real estate investment
49-33 trust whose shares were outstanding immediately before the
49-34 effective date of the merger will hold the same number of shares,
49-35 with identical designations, preferences, limitations, and relative
49-36 rights, immediately after the effective date of the merger;
49-37 (4) the voting power of the number of voting shares
49-38 outstanding immediately after the merger, plus the voting power of
49-39 the number of voting shares issuable as a result of the merger
49-40 (either by the conversion of securities issued pursuant to the
49-41 merger or the exercise of rights to purchase securities issued
49-42 pursuant to the merger), will not exceed by more than 20 percent
49-43 the voting power of the total number of voting shares of the real
49-44 estate investment trust outstanding immediately before the merger;
49-45 (5) the number of participating shares outstanding
49-46 immediately after the merger, plus the number of participating
49-47 shares issuable as a result of the merger (either by the conversion
49-48 of securities issued pursuant to the merger or the exercise of
49-49 rights to purchase securities issued pursuant to the merger), will
49-50 not exceed by more than 20 percent the total number of
49-51 participating shares of the real estate investment trust
49-52 outstanding immediately before the merger; and
49-53 (6) the trust manager(s) of the real estate investment
49-54 trust adopt a resolution approving the plan of merger.
49-55 (H) In this Section:
49-56 (1) "Participating shares" means shares that entitle
49-57 the holders of the shares to participate in distributions without
49-58 limitation.
49-59 (2) "Voting shares" means shares that entitle the
49-60 holders of the shares to vote unconditionally in elections of trust
49-61 manager(s).
49-62 (I) After a merger or share exchange is approved, and at any
49-63 time before the merger or share exchange has become effective, the
49-64 plan of merger or share exchange may be abandoned (subject to any
49-65 contractual rights) by any of the real estate investment trusts
49-66 that are a party to the merger, without shareholder action, in
49-67 accordance with the procedures set forth in the plan of merger or
49-68 exchange, or, if no such procedures are set forth in the plan, in
49-69 the manner determined by the trust manager(s). If articles of
49-70 merger or exchange have been filed with the Secretary of State but
50-1 the merger or share exchange has not become effective, the merger
50-2 or share exchange may be abandoned as provided in this Subsection
50-3 if a statement, executed on behalf of each domestic and foreign
50-4 entity that is a party to the merger or share exchange by an
50-5 officer or other duly authorized representative of the domestic or
50-6 foreign entity, and stating that the plan of merger or exchange has
50-7 been abandoned in accordance with the plan and this Subsection, is
50-8 filed with the Secretary of State before the merger or share
50-9 exchange takes effect. If the Secretary of State finds that the
50-10 statement conforms to law, the Secretary of State, when all fees
50-11 have been paid as required by law, shall:
50-12 (1) Endorse on the original and each copy the word
50-13 "Filed" and the month, day, and year of the filing of the statement
50-14 thereof.
50-15 (2) File the original in the office of the Secretary
50-16 of State.
50-17 (3) Issue a certificate of abandonment to each
50-18 domestic or foreign entity that is a party to the plan of merger or
50-19 exchange.
50-20 (J) On the filing by the Secretary of State of the statement
50-21 described by Subsection (I) of this Section, the merger or share
50-22 exchange is considered abandoned and may not take effect.
50-23 Sec. 23.40. ARTICLES OF MERGER OR EXCHANGE. (A) If a plan
50-24 of merger or exchange has been approved in accordance with Section
50-25 23.30 of this Act and has not been abandoned, or approved by the
50-26 trust manager(s) if shareholder approval is not required under that
50-27 Section, articles of merger or exchange shall be executed on behalf
50-28 of each domestic or foreign corporation, real estate investment
50-29 trust, partnership or other entity that is a party to the plan of
50-30 merger or exchange by an officer or other duly authorized
50-31 representative of that entity and shall set forth:
50-32 (1) The plan of merger or exchange or statement
50-33 certifying the following:
50-34 (a) the name and state of incorporation or
50-35 organization of each domestic or foreign corporation, real estate
50-36 investment trust, partnership or other entity that is a party to
50-37 the plan of merger or exchange or that is to be created by the plan
50-38 of merger or exchange;
50-39 (b) that a plan of merger or exchange has been
50-40 approved;
50-41 (c) in the case of a merger, the amendments or
50-42 changes in the declaration of trust of each domestic surviving real
50-43 estate investment trust, or if no amendments are to be effected by
50-44 the merger, a statement to that effect;
50-45 (d) the declaration of trust of each new
50-46 domestic real estate investment trust to be created pursuant to the
50-47 terms of the plan of merger;
50-48 (e) that an executed plan of merger or exchange
50-49 is on file at the principal place of business of each surviving,
50-50 acquiring, or new domestic or foreign corporation, real estate
50-51 investment trust, partnership or other entity, stating the address
50-52 of that entity; and
50-53 (f) that a copy of the plan of merger or
50-54 exchange will be furnished by each surviving, acquiring, or new
50-55 domestic or foreign corporation, real estate investment trust,
50-56 partnership or other entity, on written request and without cost,
50-57 to any shareholder, creditor or other obligee of each domestic real
50-58 estate investment trust that is a party to or created by the plan
50-59 of merger or exchange.
50-60 (2) If shareholder approval is not required by Section
50-61 23.30 of this Act, a statement to that effect.
50-62 (3) For each real estate investment trust the approval
50-63 of whose shareholders is required, the number of shares
50-64 outstanding, and, if the shares of any class or series are entitled
50-65 to vote as a class, the designation and number of outstanding
50-66 shares of each such class or series.
50-67 (4) For each real estate investment trust the approval
50-68 of whose shareholders is required, the number of shares not
50-69 entitled to vote only as a class, voted for and against the plan,
50-70 respectively, and, if the shares of any class or series are
51-1 entitled to vote as a class, the number of shares of each such
51-2 class or series voted for and against the plan, respectively.
51-3 (5) For each acquiring domestic or foreign
51-4 corporation, real estate investment trust, partnership or other
51-5 entity in a plan of exchange, a statement that the plan and
51-6 performance of its terms were duly authorized by all action
51-7 required by the laws under which it was incorporated or organized
51-8 and by its constituent documents.
51-9 (6) For each foreign corporation, or other entity that
51-10 is a party to the plan of merger, a statement that the approval of
51-11 the plan of merger was duly authorized by all action required by
51-12 the laws under which it was incorporated or organized and by its
51-13 constituent documents.
51-14 (B) The original of the articles of merger or exchange, and
51-15 the number of copies of the articles that is equal to the number of
51-16 surviving, new, and acquiring domestic or foreign corporations,
51-17 real estate investment trusts, partnerships and other entities that
51-18 are parties to the plan of merger or exchange or that will be
51-19 created by the terms of the plan of merger or exchange thereof,
51-20 shall be delivered to the Secretary of State.
51-21 (C) If the Secretary of State finds that the articles of
51-22 merger or exchange conform to law, and when all fees and franchise
51-23 taxes, if any, have been paid as required by law or if the plan of
51-24 merger or exchange (or statement provided) provides that one or
51-25 more of the surviving, new or acquiring domestic or foreign
51-26 corporations, real estate investment trusts, partnerships or other
51-27 entities will be responsible for the payment of all fees and
51-28 franchise taxes, if any, and that all surviving, new or acquiring
51-29 domestic or foreign corporations, real estate investment trusts,
51-30 partnerships and other entities will be obligated to pay fees and
51-31 franchise taxes, if any, if the fees and franchise taxes are not
51-32 timely paid, the Secretary of State shall:
51-33 (1) Endorse on the original and each copy the word
51-34 "Filed," and the month, day, and year of the filing of articles of
51-35 merger or exchange.
51-36 (2) File the original in the office of the Secretary
51-37 of State.
51-38 (3) Issue a certificate of merger or exchange,
51-39 together with a copy of the articles attached to the certificate,
51-40 to each surviving, new, and acquiring domestic or foreign
51-41 corporation, real estate investment trust, partnership or other
51-42 entity that is a party to the plan of merger or exchange or that is
51-43 created by the plan of merger or exchange, or its or their
51-44 respective representatives.
51-45 (D) A copy of the certificate of merger or exchange, with a
51-46 copy of the articles attached to the copy of the certificate of
51-47 merger or exchange, shall be filed with the county clerk in each
51-48 county where the principal place of business of a Texas real estate
51-49 investment trust that is a party to the merger or exchange is
51-50 located.
51-51 Sec. 23.50. EFFECTIVE DATE OF MERGER OR SHARE EXCHANGE.
51-52 Except as otherwise provided by Section 27.10 of this Act, the
51-53 merger or share exchange is effective on the issuance of the
51-54 certificate of merger or exchange by the Secretary of State.
51-55 Sec. 23.60. EFFECT OF MERGER OR SHARE EXCHANGE. (A) When a
51-56 merger under Section 23.10 or 23.20 of this Act takes effect:
51-57 (1) the separate existence of every domestic real
51-58 estate investment trust that is a party to the merger, except any
51-59 surviving or new domestic real estate investment trust, ceases;
51-60 (2) all rights, title, and interest to all real estate
51-61 and other property owned by each domestic or foreign corporation,
51-62 real estate investment trust, partnership or other entity that is a
51-63 party to the merger shall be allocated to and vested in one or more
51-64 of the surviving or new domestic or foreign corporations, real
51-65 estate investment trusts, partnerships and other entities as
51-66 provided in the plan of merger without reversion or impairment,
51-67 without further act or deed, and without any transfer or assignment
51-68 having occurred, but subject to any existing liens or other
51-69 encumbrances on the real estate and property;
51-70 (3) all liabilities and obligations of each domestic
52-1 or foreign corporation, real estate investment trust, partnership
52-2 and other entity that is a party to the merger shall be allocated
52-3 to one or more of the surviving or new domestic or foreign
52-4 corporations, real estate investment trusts, partnerships or other
52-5 entities in the manner set forth in the plan of merger, and each
52-6 surviving or new domestic or foreign corporation, real estate
52-7 investment trust, partnership or other entity to which a liability
52-8 or obligation shall have been allocated pursuant to the plan of
52-9 merger shall be the primary obligor for the liability or obligation
52-10 and, except as otherwise set forth in the plan of merger or as
52-11 provided by law or contract, no other party to the merger, other
52-12 than a surviving domestic or foreign corporation, real estate
52-13 investment trust, partnership or other entity created thereby,
52-14 shall be liable for the liability or obligation;
52-15 (4) a proceeding pending by or against any domestic or
52-16 foreign corporation, real estate investment trust, partnership or
52-17 other entity that is a party to the merger may be continued as if
52-18 the merger did not occur, or the surviving or new entity or
52-19 entities to which the liability, obligation, asset or right
52-20 associated with such proceeding is allocated to and vested in
52-21 pursuant to the plan of merger, may be substituted in the
52-22 proceeding;
52-23 (5) the declaration of trust of each surviving real
52-24 estate investment trust shall be amended to the extent provided in
52-25 the plan of merger;
52-26 (6) each new domestic real estate investment trust
52-27 that has a declaration of trust set forth in the plan of merger
52-28 pursuant to Section 23.10 of this Act shall be formed as a real
52-29 estate investment trust under this Act; and each other entity to be
52-30 incorporated or organized under the laws of this State that has
52-31 organizational documents set forth in the plan of merger, on an
52-32 executed copy of the articles of merger being delivered to or filed
52-33 with any required governmental entity with which organizational
52-34 documents of such other entity are required to be delivered or
52-35 filed, and on meeting such additional requirements, if any, of law
52-36 for its incorporation or organization, shall be incorporated or
52-37 organized as provided in the plan of merger; and
52-38 (7) the shares of each domestic or foreign real estate
52-39 investment trust and the shares or evidences of ownership in each
52-40 other entity that is a party to the merger that are to be converted
52-41 or exchanged, in whole or part, into shares, obligations, evidences
52-42 of ownership, rights to purchase securities or other securities of
52-43 one or more of the surviving or new domestic or foreign
52-44 corporations, real estate investment trusts, partnerships or other
52-45 entities, into cash or other property, including shares,
52-46 obligations, evidences of ownership, rights to purchase securities
52-47 or other securities of any other person or entity, or into any
52-48 combination of the foregoing, shall be so converted and exchanged
52-49 and the former holders of the shares of each domestic real estate
52-50 investment trust that is a party to the merger shall be entitled
52-51 only to the rights provided in the articles of merger or to their
52-52 rights of dissent under Section 25.10 of this Act.
52-53 (B) When a share exchange takes effect, the shares of each
52-54 acquired real estate investment trust are considered to have been
52-55 exchanged as provided in the plan of exchange, and the former
52-56 holders of the shares exchanged pursuant to the plan of exchange
52-57 shall be entitled only to the exchange rights provided in the
52-58 articles of exchange or to their rights of dissent under Section
52-59 25.10 of this Act. When a share exchange takes effect, the
52-60 acquiring domestic or foreign entity or entities of the shares to
52-61 be acquired and exchanged in the share exchange shall be entitled
52-62 to all rights, title, and interests with respect to the shares so
52-63 acquired and exchanged subject to the provisions in the articles of
52-64 exchange.
52-65 (C) If the plan of merger fails to provide for the
52-66 allocation and vesting of the right, title, and interest in any
52-67 particular item of real estate or other property or for the
52-68 allocation of any liability or obligation of any party to the
52-69 merger, that item of real estate or other property shall be owned
52-70 in undivided interest by, or such liability or obligation shall be
53-1 the joint and several liability and obligation of, each of the
53-2 surviving and new domestic and foreign corporations, real estate
53-3 investment trusts, partnerships and other entities, pro rata to the
53-4 total number of surviving and new domestic and foreign
53-5 corporations, real estate investment trusts, partnerships and other
53-6 entities resulting from the merger.
53-7 Sec. 24.10. DISPOSITION OF ASSETS AUTHORIZED BY TRUST
53-8 MANAGERS. (A) Except as otherwise provided in the declaration of
53-9 trust and except as provided in the next sentence of this
53-10 Subsection, the sale, lease, exchange, or other disposition of all,
53-11 or substantially all, of the property and assets of a real estate
53-12 investment trust, when made in the usual and regular course of the
53-13 business of the real estate investment trust, may be made on the
53-14 terms and conditions and for the consideration that may consist in
53-15 whole or in part of money or real or personal property, including
53-16 shares of any real estate investment trust or domestic or foreign
53-17 corporation, as authorized by its trust manager(s) without
53-18 authorization or consent of the shareholders. Except as otherwise
53-19 provided in the declaration of trust, the trust manager(s) may
53-20 authorize any pledge, mortgage, deed of trust, or trust indenture,
53-21 and no authorization or consent of the shareholders shall be
53-22 required for the validity of or for any sale pursuant to the terms
53-23 of the pledge, mortgage, deed of trust, or trust indenture.
53-24 (B) A transaction referred to in this Section of this Act is
53-25 in the usual and regular course of business if the real estate
53-26 investment trust, directly or indirectly, continues to engage in
53-27 one or more businesses or applies a portion of the consideration
53-28 received in connection with the transaction to the conduct of a
53-29 business in which it engages following the transaction.
53-30 (C) When authorized by appropriate resolution of the trust
53-31 manager(s), any real estate investment trust may convey land by
53-32 deed, with or without the seal, if any, of the real estate
53-33 investment trust, signed by an officer or attorney in fact of the
53-34 real estate investment trust. The deed, when acknowledged by the
53-35 officer or attorney in fact to be the act of the real estate
53-36 investment trust, or proved in the manner prescribed for other
53-37 conveyances of lands, may be recorded in the same manner and with
53-38 the same effect as other deeds. The deed when recorded, if signed
53-39 by an officer of the real estate investment trust, constitutes
53-40 prima facie evidence that the resolution of the trust manager(s)
53-41 was duly adopted.
53-42 Sec. 24.20. DISPOSITION OF ASSETS REQUIRING SPECIAL
53-43 AUTHORIZATION OF SHAREHOLDERS; EFFECT OF DISPOSITION REQUIRING OR
53-44 NOT REQUIRING AUTHORIZATION; LIABILITY OF ACQUIRING ENTITY. (A) A
53-45 sale, lease, exchange, or other disposition (not including any
53-46 pledge, mortgage, deed of trust or trust indenture unless otherwise
53-47 provided in the declaration of trust) of all, or substantially all,
53-48 the property and assets, with or without the good will, of a real
53-49 estate investment trust, if not made in the usual and regular
53-50 course of its business, may be made on the terms and conditions and
53-51 for the consideration that may consist in whole or in part of money
53-52 or real or personal property, including shares of any real estate
53-53 investment trust or domestic or foreign corporation, as may be
53-54 authorized in the following manner:
53-55 (1) The trust manager(s) may adopt a resolution
53-56 recommending that the sale, lease, exchange, or other disposition
53-57 of the property and assets of a real estate investment trust be
53-58 approved by shareholders of the real estate investment trust,
53-59 unless the trust manager(s) determine that for any reason they
53-60 should not make the recommendation in which case the trust
53-61 manager(s) may adopt a resolution directing that the sale, lease,
53-62 exchange, or other disposition be submitted to shareholders without
53-63 approval and, in connection with the submission, communicate the
53-64 basis for its determination that the sale, lease, exchange or other
53-65 disposition be submitted without shareholder approval.
53-66 (2) The trust manager(s) may submit the proposed sale,
53-67 lease, exchange, or other disposition for authorization by the real
53-68 estate investment trust's shareholders at an annual or special
53-69 meeting of shareholders.
53-70 (3) Written or printed notice shall be given to each
54-1 shareholder of record entitled to vote at the meeting within the
54-2 time and in the manner provided for in this Act for giving notice
54-3 of meetings to shareholders. The notice must state that the
54-4 purpose, or one of the purposes, of the meeting is to consider the
54-5 proposed sale, lease, exchange, or other disposition of the assets
54-6 or property of the real estate investment trust.
54-7 (4) At the meeting, the shareholders may authorize the
54-8 sale, lease, exchange or other disposition of the assets and
54-9 property and may fix, or may authorize the trust manager(s) to fix,
54-10 any or all of the terms and conditions of the disposition and the
54-11 consideration to be received by the real estate investment trust
54-12 for the disposition. The authorization shall require the
54-13 affirmative vote of the holders of at least two-thirds (2/3) of the
54-14 outstanding shares of the real estate investment trust entitled to
54-15 vote on the authorization, unless any class or series of shares of
54-16 the real estate investment trust is entitled to vote as a class on
54-17 the authorization, in which case the vote required for
54-18 authorization by the shareholders shall be the affirmative vote of
54-19 the holders of at least two-thirds (2/3) of the outstanding shares
54-20 within each such class or series entitled to vote on the
54-21 authorization as a class and at least two-thirds (2/3) of the
54-22 outstanding shares otherwise entitled to vote on the authorization.
54-23 Shares entitled to vote as a class shall be entitled to vote only
54-24 as a class unless otherwise entitled to vote on each matter
54-25 submitted to the shareholders generally or provided in the
54-26 declaration of trust.
54-27 (5) After the authorization for the disposition of the
54-28 assets and property by vote of shareholders, the trust manager(s),
54-29 nevertheless, in their discretion, may abandon the sale, lease,
54-30 exchange or other disposition of assets, subject to the rights of
54-31 third parties under any contracts relating to the assets, without
54-32 further action or approval by shareholders.
54-33 (B) A disposition of any, all, or substantially all, of the
54-34 property and assets of a real estate investment trust, whether or
54-35 not it requires the special authorization of the shareholders of
54-36 the real estate investment trust, effected under Subsection (A) of
54-37 this Section or under Section 23.60 of this Act or otherwise:
54-38 (1) is not considered to be a merger pursuant to this
54-39 Act or otherwise; and
54-40 (2) except as otherwise expressly provided by another
54-41 statute, does not make the acquiring real estate investment trust,
54-42 corporation, partnership, or other entity responsible or liable for
54-43 any liability or obligation of the selling real estate investment
54-44 trust that the acquiring entity did not expressly assume.
54-45 Sec. 25.10. RIGHTS OF DISSENTING SHAREHOLDERS IN THE EVENT
54-46 OF CERTAIN ACTIONS. (A) Any shareholder of a domestic real estate
54-47 investment trust may dissent from any of the following actions:
54-48 (1) any plan of merger to which the real estate
54-49 investment trust is a party if shareholder approval is required by
54-50 Section 23.30 of this Act and the shareholder holds shares of a
54-51 class or series that was entitled to vote on the plan of merger as
54-52 a class or otherwise;
54-53 (2) any sale, lease, exchange or other disposition
54-54 (not including any pledge, mortgage, deed of trust, or trust
54-55 indenture unless otherwise provided in the declaration of trust) of
54-56 all, or substantially all, of the property and assets, with or
54-57 without good will, of a real estate investment trust requiring the
54-58 special authorization of the shareholders as provided by this Act;
54-59 or
54-60 (3) any plan of exchange pursuant to Section 23.20 of
54-61 this Act in which the shares of the real estate investment trust of
54-62 the class or series held by the shareholder are to be acquired.
54-63 (B) Notwithstanding Subsection (A) of this Section, a
54-64 shareholder may not dissent from any plan of merger in which there
54-65 is a single surviving or new domestic or foreign corporation, real
54-66 estate investment trust, partnership, or other entity, or from any
54-67 plan of exchange, if:
54-68 (1) the shares held by the shareholder are part of a
54-69 class or series, and on the record date fixed to determine the
54-70 shareholders entitled to vote on the plan of merger or plan of
55-1 exchange, the shares are:
55-2 (a) listed on a national securities exchange,
55-3 (b) designated as a national market security on an interdealer
55-4 quotation system by the National Association of Securities Dealers,
55-5 Inc., or successor entity, or (c) held of record by not less than
55-6 2,000 holders; and
55-7 (2) the shareholder is not required by the terms of
55-8 the plan of merger or the plan of exchange to accept any
55-9 consideration for the shareholder's shares other than:
55-10 (a) shares of a domestic or foreign entity that,
55-11 immediately after the effective date of the merger or exchange,
55-12 will be part of a class or series, shares of which are (i) listed,
55-13 or authorized for listing upon official notice of issuance, on a
55-14 national securities exchange, (ii) approved for quotation as a
55-15 national market security on an interdealer quotation system by the
55-16 National Association of Securities Dealers, Inc., or successor
55-17 entity, or (iii) held of record by not less than 2,000 holders;
55-18 (b) cash in lieu of fractional shares otherwise
55-19 entitled to be received; or
55-20 (c) any combination of the securities and cash
55-21 described in this Subdivision.
55-22 Sec. 25.20. PROCEDURE FOR DISSENT BY SHAREHOLDERS AS TO
55-23 ACTIONS. (A) Any shareholder of any domestic real estate
55-24 investment trust who has the right to dissent from any of the
55-25 actions referred to in Section 25.10 of this Act may exercise that
55-26 right to dissent only by complying with the following procedures:
55-27 (1)(a) With respect to a proposed action that is
55-28 submitted to a vote of shareholders at a meeting, the shareholder
55-29 shall file with the real estate investment trust, before the
55-30 meeting, a written objection to the action. The shareholder's
55-31 objection must state that the shareholder will exercise the
55-32 shareholder's right to dissent if the action is effective and must
55-33 contain the shareholder's address, to which notice of the action
55-34 shall be delivered or mailed in that event. If the action is
55-35 effected and the shareholder did not vote in favor of the action,
55-36 the real estate investment trust, in the case of action other than
55-37 a merger, or the surviving or new entity that is liable in the case
55-38 of a merger to discharge the shareholder's right of dissent, shall
55-39 deliver or mail to the shareholder written notice that the action
55-40 has been effected within ten (10) days after the action is
55-41 effected. The shareholder may make a written demand on the
55-42 existing, surviving, or new entity for payment of the fair value of
55-43 the shareholder's shares within 10 days from the delivery or
55-44 mailing of the notice. The fair value of the shares shall be the
55-45 value of the shares on the day before the meeting, excluding any
55-46 appreciation or depreciation in anticipation of the proposed
55-47 action. The demand shall state the number and class of the shares
55-48 owned by the shareholder and the fair value of the shares as
55-49 estimated by the shareholder. A shareholder who fails to make a
55-50 demand within the 10-day period is bound by the action.
55-51 (b) With respect to a proposed action that is
55-52 approved pursuant to Subsection (A) of Section 10.30 of this Act,
55-53 the real estate investment trust, in the case of action other than
55-54 a merger, and the surviving or new entity that is liable in the
55-55 case of a merger to discharge the shareholder's right of dissent,
55-56 within 10 days after the date the action takes effect, shall mail
55-57 to each shareholder of record as of the date the action takes
55-58 effect notice of the fact and date of the action and that the
55-59 shareholder may exercise the shareholder's right to dissent from
55-60 the action. The notice shall be accompanied by a copy of this
55-61 Section and any articles or documents filed by the real estate
55-62 investment trust with the Secretary of State to effect the action.
55-63 If the shareholder did not consent to the taking of the action, the
55-64 shareholder may make written demand on the existing, surviving, or
55-65 new entity for payment of the fair value of the shareholder's
55-66 shares within 20 days after the mailing of the notice. The fair
55-67 value of the shares shall be the value of the shares on the date
55-68 the written consent authorizing the action was delivered to the
55-69 real estate investment trust pursuant to Subsection (A) of Section
55-70 10.20 of this Act, excluding any appreciation or depreciation in
56-1 anticipation of the action. The demand shall state the number and
56-2 class of shares owned by the dissenting shareholder and the fair
56-3 value of the shares as estimated by the shareholder. Any
56-4 shareholder failing to make demand within the 20-day period is
56-5 bound by the action.
56-6 (2) Within 20 days after receipt by the existing,
56-7 surviving, or new entity of a demand for payment made by a
56-8 dissenting shareholder in accordance with Subdivision (1) of this
56-9 Subsection, the entity shall deliver or mail to the shareholder a
56-10 written notice that shall either set out that the entity accepts
56-11 the amount claimed in the demand and agrees to pay that amount
56-12 within 90 days after the date on which the action was effected,
56-13 and, in the case of shares represented by certificates, on the
56-14 surrender of the certificates duly endorsed, or shall contain an
56-15 estimate by the entity of the fair value of the shares and an offer
56-16 to pay the amount of that estimate within 90 days after the date on
56-17 which the action was effected, on receipt of notice within 60 days
56-18 after that date from the shareholder that the shareholder agrees to
56-19 accept that amount and, in the case of shares represented by
56-20 certificates, on the surrender of the certificates duly endorsed.
56-21 (3) If, within 60 days after the date on which the
56-22 real estate investment trust action was effected, the value of the
56-23 shares is agreed on between the shareholder and the existing,
56-24 surviving, or new entity, payment for the shares shall be made
56-25 within 90 days after the date on which the action was effected and,
56-26 in the case of shares represented by certificates, on surrender of
56-27 the certificates duly endorsed. On payment of the agreed value,
56-28 the shareholder ceases to have any interest in the shares or in the
56-29 real estate investment trust.
56-30 (B) If, within 60 days after the date on which the action
56-31 was effected, the shareholder and the existing, surviving, or new
56-32 entity do not agree on the value of the shares, the shareholder or
56-33 entity, within 60 days after the expiration of the 60-day period,
56-34 may file a petition in any court of competent jurisdiction in the
56-35 county in which the principal office of the domestic real estate
56-36 investment trust is located, asking for a finding and determination
56-37 of the fair value of the shareholder's shares. On the filing of a
56-38 petition by the shareholder, service of a copy of the petition must
56-39 be made on the entity. The entity, within 10 days after receiving
56-40 the service, shall file in the office of the clerk of the court in
56-41 which the petition was filed a list containing the names and
56-42 addresses of all shareholders of the domestic real estate
56-43 investment trust who have demanded payment for their shares and
56-44 with whom agreements as to the value of their shares have not been
56-45 reached by the entity. If the petition is filed by the entity, the
56-46 list described in this Subsection must be attached to the petition.
56-47 The clerk of the court shall give notice of the time and place
56-48 fixed for the hearing of the petition by registered mail to the
56-49 entity and to the shareholders named on the list at the addresses
56-50 stated in the list. The court shall approve the forms of notices
56-51 sent by mail. All shareholders notified as required by this
56-52 Subsection and the entity are bound by the final judgment of the
56-53 court.
56-54 (C) After the hearing of a petition filed under this
56-55 Section, the court shall determine which shareholders have complied
56-56 with the provisions of this Section and have become entitled to the
56-57 valuation of and payment of their shares. The court shall appoint
56-58 one or more qualified appraisers to determine that value. The
56-59 appraisers may examine any books and records of the real estate
56-60 investment trust that relate to the shares the appraisers are
56-61 charged with the duty of valuing. The appraisers shall make a
56-62 determination of the fair value of the shares after conducting an
56-63 investigation. The appraisers shall also afford a reasonable
56-64 opportunity to allow interested parties to submit to the appraisers
56-65 pertinent evidence relating to the value of the shares. The
56-66 appraisers also have the power and authority that may be conferred
56-67 on masters in chancery by the Rules of Civil Procedure.
56-68 (D) The appraisers shall determine the fair value of the
56-69 shares of the shareholders adjudged by the court to be entitled to
56-70 payment for their shares and shall file their report of that value
57-1 in the office of the clerk of the court. The clerk shall give
57-2 notice of the filing of the appraisers report to interested
57-3 parties. The appraisers report shall be subject to exceptions to
57-4 be heard before the court both on the law and the facts. The court
57-5 shall determine the fair value of the shares of the shareholders
57-6 entitled to payment for their shares and shall order the existing,
57-7 surviving, or new entity to pay that value, together with interest
57-8 on the value of shares to the shareholders entitled to payment,
57-9 beginning 91 days after the date on which the applicable action
57-10 from which the shareholder elected to dissent was effected to the
57-11 date of such judgment. The judgment shall be immediately payable
57-12 to the holders of uncertificated shares. The judgment shall be
57-13 payable to the holders of shares represented by certificates only
57-14 on, and simultaneously with, the surrender to the existing,
57-15 surviving, or new entity of duly endorsed certificates for those
57-16 shares. On payment of the judgment, the dissenting shareholders
57-17 cease to have any interest in those shares or in the real estate
57-18 investment trust. The court shall allow the appraisers a
57-19 reasonable fee as court costs, and all court costs shall be
57-20 allocated between the parties in the manner that the court
57-21 determines to be fair and equitable.
57-22 (E) Shares acquired by the existing, surviving, or new
57-23 entity, pursuant to the payment of the agreed value of the shares,
57-24 to the payment of the agreed value of the shares, or to payment of
57-25 the judgment entered for the value of the shares, as in this
57-26 Section provided, in the case of a merger, shall be treated as
57-27 provided in the plan of merger and, in all other cases, may be held
57-28 and disposed of by the real estate investment trust as in the case
57-29 of other treasury shares.
57-30 (F) This Section does not apply to a merger if, on the date
57-31 of the filing of the articles of merger, the surviving entity is
57-32 the owner of all the outstanding shares of the other entities,
57-33 domestic or foreign, that are parties to the merger.
57-34 (G) In the absence of fraud in the transaction, the remedy
57-35 provided by this Section to a shareholder objecting to any action
57-36 referred to in Section 25.10 of this Act is the exclusive remedy
57-37 for the recovery of the value of the shareholder's shares or money
57-38 damages to the shareholder with respect to the action. If the
57-39 existing, surviving, or new entity complies with the requirements
57-40 of this Section, any shareholder who fails to comply with the
57-41 requirements of this Section is not entitled to bring suit for the
57-42 recovery of the value of the shareholder's shares or money damages
57-43 to the shareholder with respect to the action.
57-44 Sec. 25.30. PROVISIONS AFFECTING REMEDIES OF DISSENTING
57-45 SHAREHOLDERS. (A) Any shareholder who has demanded payment for
57-46 the shareholder's shares in accordance with Section 25.20 of this
57-47 Act is not entitled to vote or exercise any other rights of a
57-48 shareholder except the right to receive payment for the
57-49 shareholder's shares pursuant to the provisions of that Section and
57-50 the right to maintain an appropriate action to obtain relief on the
57-51 ground that the action would be or was fraudulent. The respective
57-52 shares for which payment has been demanded may not be considered
57-53 outstanding for the purposes of any subsequent vote of
57-54 shareholders.
57-55 (B) On receiving a demand for payment from any dissenting
57-56 shareholder, the real estate investment trust shall make an
57-57 appropriate notation of the demand in its shareholder records.
57-58 Within 20 days after demanding payment for shares in accordance
57-59 with Section 25.20 of this Act, each holder of certificates
57-60 representing those shares shall submit the certificates to the real
57-61 estate investment trust for notation on the certificates that such
57-62 demand has been made. The failure of holders of certificated
57-63 shares to submit the certificates to the real estate investment
57-64 trust, at the option of the real estate investment trust, shall
57-65 terminate the shareholder's rights under Section 25.20 of this Act
57-66 unless a court of competent jurisdiction for good and sufficient
57-67 cause shown directs otherwise. If uncertificated shares for which
57-68 payment has been demanded or shares represented by a certificate on
57-69 which the real estate investment trust has made a notation under
57-70 this Subsection are transferred, any new certificate issued for
58-1 those shares shall bear similar notation together with the name of
58-2 the original dissenting holder of those shares, and a transferee of
58-3 those shares shall acquire by the transfer no rights in the real
58-4 estate investment trust other than those which the original
58-5 dissenting shareholder had after making demand for payment of the
58-6 fair value of the shares.
58-7 (C) Any shareholder who has demanded payment for the
58-8 shareholder's shares in accordance with Section 25.20 of this Act
58-9 may withdraw that demand at any time before payment of those shares
58-10 has been made or before any petition has been filed pursuant to
58-11 Section 25.20 of this Act. The demand may not be withdrawn after
58-12 the payment of the shares has been made or after any such petition
58-13 has been filed, unless the real estate investment trust consents to
58-14 the withdrawal of the demand. The shareholder and all persons
58-15 claiming under the shareholder shall be conclusively presumed to
58-16 have approved and ratified the action from which the shareholder
58-17 dissented and shall be bound by the action, the rights of the
58-18 shareholder to be paid the fair value of the shareholder's shares
58-19 shall cease, and the shareholder's status as a shareholder shall be
58-20 restored without prejudice to any proceedings that may have been
58-21 taken during the interim, and the shareholder is entitled to
58-22 receive any dividends or other distributions made to the
58-23 shareholders in the interim if:
58-24 (1) the demand is withdrawn as provided in this
58-25 Subsection;
58-26 (2) pursuant to Subsection B of this Section, the
58-27 demand terminates the shareholder's rights under Section 25.20 of
58-28 this Act;
58-29 (3) no petition asking for a court finding and
58-30 determination of fair value of such shares has been filed within
58-31 the time provided in Section 25.20 of this Act; or
58-32 (4) the court determines, after the hearing of a
58-33 petition filed under Section 25.20, that the shareholder is not
58-34 entitled to the relief provided by that Section.
58-35 Sec. 26.10. REORGANIZATION UNDER A FEDERAL STATUTE.
58-36 (A) Notwithstanding any other provision of this Act to the
58-37 contrary, a trustee appointed for a real estate investment trust
58-38 being reorganized under a federal statute, the designated officers
58-39 of the real estate investment trust, or any other individual or
58-40 individuals designated by the court to act on behalf of the real
58-41 estate investment trust may do any of the following without action
58-42 by or notice to its trust managers or shareholders in order to
58-43 carry out a plan of reorganization ordered or decreed by a court of
58-44 competent jurisdiction under the federal statute:
58-45 (1) amend or restate its declaration of trust if the
58-46 declaration of trust after amendment or restatement contains only
58-47 provisions required or permitted in a declaration of trust;
58-48 (2) merge or engage in a share exchange with one or
58-49 more domestic or foreign real estate investment trusts,
58-50 corporations, partnerships or other entities pursuant to a plan of
58-51 merger or exchange having such terms and provisions as required or
58-52 permitted by Sections 23.10 and 23.20 of this Act;
58-53 (3) change the location of its registered office,
58-54 change its registered agent, and remove or appoint any agent to
58-55 receive service of process;
58-56 (4) alter, amend, or repeal its bylaws;
58-57 (5) constitute or reconstitute and classify or
58-58 reclassify its trust managers, and name, constitute, or appoint
58-59 trust managers and officers in place of or in addition to all or
58-60 some of the officers or trust managers then in place;
58-61 (6) sell, lease, exchange or otherwise dispose of all,
58-62 or substantially all, of its property and assets;
58-63 (7) authorize and fix the terms, manner, and
58-64 conditions of the issuance of bonds, debentures, or other
58-65 obligations, whether or not convertible into shares of any class or
58-66 bearing warrants or other evidences of optional rights to purchase
58-67 or subscribe for any shares of any class; or
58-68 (8) dissolve.
58-69 (B) Actions taken under Subdivision (4) or (5) of Subsection
58-70 (A) of this Section take effect on the date the order or decree
59-1 approving the plan of reorganization is entered or on another
59-2 effective date as may be specified, without further action of the
59-3 real estate investment trust, as and to the extent set forth in the
59-4 plan of reorganization or the order or decree approving the plan of
59-5 reorganization.
59-6 (C) A trustee appointed for a real estate investment trust
59-7 being reorganized under a federal statute, the designated officers
59-8 of the real estate investment trust, or any other individual or
59-9 individuals designated by the court on behalf of a real estate
59-10 investment trust that is being reorganized, may sign:
59-11 (1) articles of amendment or a restated declaration of
59-12 trust setting forth:
59-13 (a) the name of the real estate investment
59-14 trust;
59-15 (b) the text of each amendment or the
59-16 restatement approved by the court;
59-17 (c) the date of the court's order or decree
59-18 approving the articles of amendment or restatement;
59-19 (d) the court, file name, and case number of the
59-20 reorganization case in which the order or decree was entered; and
59-21 (e) a statement that the court had jurisdiction
59-22 of the case under federal statute;
59-23 (2) articles of merger or exchange setting forth:
59-24 (a) the name of the real estate investment
59-25 trust;
59-26 (b) the text of the part of the plan of
59-27 reorganization that contains the plan of merger or exchange
59-28 approved by the court and that shall include the information
59-29 required by Section 23.40 of this Act, as applicable;
59-30 (c) the date of the court's order or decree
59-31 approving the plan of merger or consolidation;
59-32 (d) the court, file name, and case number of the
59-33 reorganization case in which the order or decree was entered; and
59-34 (e) a statement that the court had jurisdiction
59-35 of the case under federal statute; or
59-36 (3) articles of dissolution setting forth:
59-37 (a) the name of the real estate investment
59-38 trust;
59-39 (b) the information required by Section 19.10 of
59-40 this Act, if any;
59-41 (c) the date of the court's order or decree
59-42 approving the articles of dissolution;
59-43 (d) a statement that the debts, obligations and
59-44 liabilities of the real estate investment trust have been paid or
59-45 discharged as provided in the plan of reorganization and that the
59-46 remaining property and assets of the real estate investment trust
59-47 have been distributed as provided in the plan of reorganization;
59-48 (e) the court, file name, and case number of the
59-49 reorganization case in which the order or decree was entered; and
59-50 (f) a statement that the court had jurisdiction
59-51 of the case under federal statute.
59-52 (D) The following apply when a domestic or foreign real
59-53 estate investment trust, corporation, partnership or other entity
59-54 that is not being reorganized merges or engages in a share exchange
59-55 with a real estate investment trust that is being reorganized
59-56 pursuant to a plan of reorganization:
59-57 (1) Sections 23.10, 23.20, 23.30, 25.10, 25.20, and
59-58 25.30 of this Act apply to the domestic or foreign real estate
59-59 investment trust, corporation, partnership, or other entity that is
59-60 not being reorganized to the same extent those sections would apply
59-61 if that entity were merging or engaging in a share exchange with a
59-62 real estate investment trust that is not being reorganized.
59-63 (2) Section 23.60 of this Act applies to the domestic
59-64 or foreign real estate investment trust, corporation, partnership
59-65 or other entity that is not being reorganized to the same extent
59-66 that Section would apply if the domestic or foreign real estate
59-67 investment trust, corporation, partnership or other entity were
59-68 merging or engaging in a share exchange with a real estate
59-69 investment trust that is not being reorganized, except as otherwise
59-70 provided in the plan of reorganization ordered or decreed by a
60-1 court of competent jurisdiction under the federal statute.
60-2 (3) On receiving all of the required authorization for
60-3 all action required by this Act for each real estate investment
60-4 trust that is a party to the plan of merger or exchange that is not
60-5 being reorganized and all action by each domestic or foreign real
60-6 estate investment trust, corporation, partnership or other entity
60-7 that is a party to the plan of merger or exchange required by the
60-8 laws under which it is incorporated or organized and its
60-9 constituent documents, each domestic or foreign real estate
60-10 investment trust, corporation, partnership or other entity that is
60-11 a party to the merger or exchange other than the real estate
60-12 investment trust that is being reorganized as provided in Section
60-13 23.40 of this Act the persons described by Subsection (C) of this
60-14 Section, on behalf of the real estate investment trust that is
60-15 being reorganized, shall sign the articles of merger or exchange.
60-16 (4) The articles of merger or exchange shall set forth
60-17 the information required in Subdivision (2) of Subsection (C) of
60-18 this Section.
60-19 (5) The articles of merger or exchange shall be filed
60-20 with the Secretary of State in the manner and with the number of
60-21 copies provided in Section 23.40 of this Act.
60-22 (6) On the issuance of the certificate of merger or
60-23 share exchange by the Secretary of State as provided in Section
60-24 23.40 of this Act, the merger or share exchange becomes effective
60-25 with the same effect as if the merger or share exchange had been
60-26 adopted by unanimous action of the trust managers and shareholders
60-27 of the real estate investment trust being reorganized. The
60-28 effectiveness of the merger or share exchange shall be determined
60-29 as provided in Section 23.50 of this Act.
60-30 (E) Shareholders of a real estate investment trust being
60-31 reorganized under a federal statute do not have a right to dissent
60-32 under this Act, unless the plan of reorganization provides
60-33 otherwise.
60-34 (F) This Section does not apply after a final decree is
60-35 entered by a court in the reorganization case even though the court
60-36 may retain jurisdiction of the case for limited purposes unrelated
60-37 to consummation of the plan of reorganization.
60-38 (G) This Section does not preclude other changes in real
60-39 estate investment securities by a plan of reorganization ordered or
60-40 decreed by a court of competent jurisdiction under federal statute.
60-41 Sec. 27.10. DELAYED EFFECTIVENESS OF CERTAIN FILINGS.
60-42 (A) A permitted act may be made effective at a time and date after
60-43 the time and date otherwise provided for the permitted act in this
60-44 Act or may be made effective on the occurrence of future events or
60-45 facts, including future acts of any person or entity, if:
60-46 (1) the articles, statement, application, or other
60-47 filing that is required to be filed with the Secretary of State by
60-48 this Act to make effective the permitted act clearly and expressly
60-49 set forth, in addition to any other statement or information
60-50 required to be set forth in those documents:
60-51 (a) the time and date on which the permitted act
60-52 is to become effective or whether the permitted act is to become
60-53 effective on the occurrence of a future event or fact;
60-54 (b) the manner in which the future event or fact
60-55 shall operate to cause the permitted act to become effective; and
60-56 (c) the date of the 90th day after the date of
60-57 the filing of the articles, statement, application or other filing;
60-58 (2) in the case of a permitted act that is to become
60-59 effective as of a time or date after the time and date otherwise
60-60 provided in this Act, the subsequent time and date is not more than
60-61 90 days after the date of the filing of the articles, statement,
60-62 application, or other filing that is otherwise required by this Act
60-63 to be filed with the Secretary of State to make effective the
60-64 permitted act and the time on which the permitted act is to become
60-65 effective is not midnight or noon; and
60-66 (3) in the case of a permitted act that is to take
60-67 effect on the occurrence of events or facts that may occur in the
60-68 future, other than the mere passage of time, a statement that all
60-69 the events or facts on which the effectiveness of the permitted act
60-70 is conditioned have been satisfied or waived, including the date on
61-1 which the condition was satisfied or waived, is filed with the
61-2 Secretary of State within 90 days of the date of the filing of the
61-3 articles, statement, application or other filing that is otherwise
61-4 required by this Act for the permitted act to become effective.
61-5 (B) The statement required by Subdivision (3) of Subsection
61-6 (A) of this Section shall be executed on behalf of each domestic or
61-7 foreign real estate investment trust, corporation, partnership, or
61-8 other entity that was required to execute the articles, statement,
61-9 application, or other filing that is otherwise required to be filed
61-10 with the Secretary of State to make effective the permitted act by
61-11 this Act by an officer or other duly authorized representative of
61-12 the entity, including an officer or duly authorized representative
61-13 of any successor domestic or foreign real estate investment trust,
61-14 corporation, partnership, or other entity. The original statement
61-15 and a copy of the original statement must be filed with the
61-16 Secretary of State. If the Secretary of State finds that the
61-17 statement conforms to the provisions of this Act, the Secretary of
61-18 State shall:
61-19 (1) Endorse on the original and the copy the word
61-20 "Filed" and the month, day, and year of the filing of the
61-21 statement.
61-22 (2) File the original in the office of the Secretary
61-23 of State.
61-24 (3) Return the copy to the filing party or its
61-25 representative.
61-26 (C) If any permitted act is to take effect as of a time or
61-27 date after the time and date otherwise provided in this Act for the
61-28 permitted act to become effective, notwithstanding any other
61-29 provision of this Act to the contrary, the permitted act, to the
61-30 extent permitted by Subsection (A) of this Section, shall take
61-31 effect on that subsequent time and date. Any certificate issued by
61-32 the Secretary of State on the filing of the articles, statement,
61-33 application or other filing that is otherwise required by this Act
61-34 for the permitted act to become effective shall expressly set forth
61-35 the time and date on which the permitted act is to take effect.
61-36 (D) If any permitted act is to be made effective on the
61-37 occurrence of future events or facts, other than the mere passage
61-38 of time, and the statement required by Subdivision (3) of
61-39 Subsection (A) of this Section is filed with the Secretary of State
61-40 within the time prescribed in that Subdivision, the permitted act
61-41 takes effect on the time and date on which the latest specified
61-42 event or fact occurs or the time and date on which the condition is
61-43 otherwise satisfied or waived. Any certificate issued, or
61-44 notation, acknowledgement or other statement made by the Secretary
61-45 of State on the filing of the articles, statement, application, or
61-46 other filing that is otherwise required by this Act for the
61-47 permitted act to take effect shall state that "The effectiveness of
61-48 the action to which this instrument relates is conditioned on the
61-49 occurrence of certain facts or events described in the filing to
61-50 which this instrument relates" or shall make reference, in such
61-51 manner as the Secretary of State considers appropriate, to the fact
61-52 that the effectiveness of the action is conditioned on the
61-53 occurrence of those facts or events. The time and date on which a
61-54 condition to the effectiveness of a permitted act is satisfied or
61-55 waived as set forth in a statement filed with the Secretary of
61-56 State under Subdivision (3) of Subsection (A) of this Section shall
61-57 be conclusively regarded as the time and date on which the
61-58 condition was satisfied or waived for purposes of this Section.
61-59 (E) If the effectiveness of any permitted act is conditioned
61-60 on the occurrence of future events or facts, other than the mere
61-61 passage of time, and the statement required by Subdivision (3) of
61-62 Subsection (A) of this Section is not filed with the Secretary of
61-63 State within the time prescribed in that Subdivision, the permitted
61-64 act may not take effect unless the articles, statement,
61-65 application, or other filing required by this Act to be filed with
61-66 the Secretary of State to make the permitted act effective are
61-67 subsequently filed with the Secretary of State.
61-68 (F) In this section, "permitted act" means:
61-69 (1) the formation of a real estate investment trust
61-70 under this Act;
62-1 (2) an amendment to a real estate investment trust's
62-2 declaration of trust, including an amendment effected pursuant to a
62-3 statement of resolution establishing a series of shares;
62-4 (3) the restatement of declaration of trust of a real
62-5 estate investment trust;
62-6 (4) a merger or share exchange;
62-7 (5) a cancellation of redeemable or reacquired shares
62-8 or a reduction in stated capital;
62-9 (6) a voluntary dissolution;
62-10 (7) a bylaw or agreement restricting the transfer of
62-11 shares or securities of a real estate investment trust pursuant to
62-12 this Act;
62-13 (8) a change in registered office or registered agent;
62-14 or
62-15 (9) a change of address of a registered agent.
62-16 Sec. 28.10 <24>. CASES NOT PROVIDED FOR. (A) In any case
62-17 not provided for in this Act, analogous provisions of the Texas
62-18 Business Corporation Act, and the case law construing that Act,
62-19 shall govern; provided, however, that in any case where a provision
62-20 of this Act conflicts with a provision of the Texas Business
62-21 Corporation Act, the provisions of this Act control. Nothing in
62-22 this Section shall be construed to cause a provision of the Texas
62-23 Business Corporation Act to control over a similar provision of
62-24 this Act on the grounds that the Texas Business Corporation Act
62-25 provision is more or less extensive, restrictive, or detailed. <the
62-26 rules of law and equity, including the law of merchant shall
62-27 govern. For purposes of the Texas Trust Code (Subtitle B, Title 9,
62-28 Property Code) and this Act, a real estate investment trust created
62-29 hereunder shall be considered a "business trust.">
62-30 (B) Any unincorporated trust which does not meet the
62-31 requirements of this Act shall be treated as an unincorporated
62-32 association pursuant to Chapter 2 of this Title 105.
62-33 SECTION 2. This Act takes effect September 1, 1995, and
62-34 changes in law made by this Act apply only to an action or
62-35 proceeding that is commenced on or after that date. An action or
62-36 proceeding that was commenced before the effective date of this Act
62-37 is governed by the law as it existed immediately before the
62-38 effective date, and that law is continued in effect for that
62-39 purpose.
62-40 SECTION 3. The importance of this legislation and the
62-41 crowded condition of the calendars in both houses create an
62-42 emergency and an imperative public necessity that the
62-43 constitutional rule requiring bills to be read on three several
62-44 days in each house be suspended, and this rule is hereby suspended.
62-45 * * * * *