By Sibley S.B. No. 554
75R4611 CLG-F
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the Texas Non-Profit Corporation Act.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Section A, Article 2.01, Texas Non-Profit
1-5 Corporation Act (Article 1396-2.01, Vernon's Texas Civil Statutes),
1-6 is amended to read as follows:
1-7 A. Except as hereinafter in this Article expressly excluded
1-8 herefrom, non-profit corporations may be organized under this Act
1-9 for any lawful purpose or purposes, which [purposes shall be fully
1-10 stated in the articles of incorporation. Such] purpose or purposes
1-11 may include, without being limited to, any one or more of the
1-12 following: charitable, benevolent, religious, eleemosynary,
1-13 patriotic, civic, missionary, educational, scientific, social,
1-14 fraternal, athletic, aesthetic, agricultural and horticultural; and
1-15 the conduct of professional, commercial, industrial, or trade
1-16 associations; and animal husbandry. Subject to the provisions of
1-17 Chapter 2, Title 83, of the Revised Civil Statutes of Texas, 1925,
1-18 and of such Chapter or any part thereof as it may hereafter be
1-19 amended, a corporation may be organized under this Act if any one
1-20 or more of its purposes for the conduct of its affairs in this
1-21 State is to organize laborers, working men, or wage earners to
1-22 protect themselves in their various pursuits.
1-23 (1) Charitable corporations may be formed for the
1-24 purpose of operating a Dental Health Service Corporation which
2-1 service corporation will manage and coordinate the relationship
2-2 between the contracting dentist, who will perform the dental
2-3 services, and the patient who will receive such services where such
2-4 patient is a member of a group which has contracted with the Dental
2-5 Health Service Corporation to provide dental care to members of
2-6 that group. An application for a charter under this Section shall
2-7 have attached as exhibits (1) an affidavit by the applicants that
2-8 not less than thirty percent (30%) of the dentists legally engaged
2-9 in the practice of dentistry in this state together with their
2-10 names and addresses have signed contracts to perform the required
2-11 dental services for a period of not less than one (1) year, after
2-12 incorporation, and (2) a certification by the Texas State Board of
2-13 Dental Examiners that the applicant incorporators are reputable
2-14 citizens of the State of Texas and are of good moral character and
2-15 that the corporation sought to be formed will be in the best
2-16 interest of the public health. A corporation formed hereunder
2-17 shall have not less than twelve (12) directors, nine (9) of whom
2-18 shall be dentists licensed by the Texas State Board of Dental
2-19 Examiners to practice dentistry in this state and be actively
2-20 engaged in the practice of dentistry in this state. A corporation
2-21 formed hereunder shall maintain not less than thirty percent (30%)
2-22 of the number of dentists actually engaged in the practice of
2-23 dentistry in this state as participating or contracting dentists,
2-24 and shall file with the Texas State Board of Dental Examiners each
2-25 September the names and addresses of all contracting or
2-26 participating dentists. A corporation formed hereunder shall not
2-27 (1) prevent any patient from selecting the licensed dentist of his
3-1 choice to render dental services to him, (2) deny any licensed
3-2 dentist the right to participate as a contracting dentist to
3-3 perform the dental services contracted for by the patient, (3)
3-4 discriminate among patients or licensed dentists regarding payment
3-5 or reimbursement for the cost of performing dental services
3-6 provided the dentist is licensed to perform the dental service, or
3-7 (4) authorize any person to regulate, interfere, or intervene in
3-8 any manner in the diagnosis or treatment rendered by a licensed
3-9 dentist to his patient. A corporation formed hereunder may require
3-10 the attending dentist to provide a narrative oral or written
3-11 description of the dental services rendered for the purpose of
3-12 determining benefits or providing proof of treatment. Diagnostic
3-13 aids used in the course of treatment may be requested by the
3-14 corporation, but may not be required for any purpose.
3-15 SECTION 2. Article 2.04, Texas Non-Profit Corporation Act
3-16 (Article 1396-2.04, Vernon's Texas Civil Statutes), is amended to
3-17 read as follows:
3-18 Art. 2.04. Corporate Name. A. The corporate name shall
3-19 conform to the following requirements:
3-20 (1) It shall not contain any word or phrase which
3-21 indicates or implies that it is organized for any purpose other
3-22 than one or more of the purposes contained in its articles of
3-23 incorporation.
3-24 (2) It shall not be the same as, or deceptively
3-25 similar to, the name of any domestic corporation, whether for
3-26 profit or not for profit, limited partnership, or limited liability
3-27 company existing under the laws of this State, or the name of any
4-1 foreign corporation, whether for profit or not for profit, limited
4-2 partnership, or limited liability company authorized to transact
4-3 business or conduct affairs in this State, or a name the exclusive
4-4 right to which is, at the time, reserved in the manner provided by
4-5 this Act, the Texas Business Corporation Act, or any other statute
4-6 providing for reservation of names by a limited partnership or
4-7 limited liability company, or the name of a corporation, limited
4-8 partnership, or limited liability company which has in effect a
4-9 registration of its company [corporate] name as provided in the
4-10 Texas Business Corporation Act or any other applicable law;
4-11 provided that a name may be similar if written consent is obtained
4-12 from the existing corporation, limited partnership, or limited
4-13 liability company having the name deemed to be similar, or the
4-14 person[, or corporation,] for whom the name deemed to be similar is
4-15 reserved or registered in the office of the Secretary of State.
4-16 (3) It shall not contain the word "lottery."
4-17 SECTION 3. Article 2.04A, Texas Non-Profit Corporation Act
4-18 (Article 1396-2.04A, Vernon's Texas Civil Statutes), is amended by
4-19 adding Section C to read as follows:
4-20 C. Any person for whom a specified corporate name has been
4-21 reserved pursuant to Section B of this article may, during the
4-22 period for which such name is reserved, terminate such reservation
4-23 by filing with the Secretary of State an application for
4-24 cancellation of reservation of corporate name subject to the
4-25 procedures prescribed by Article 2.06, Texas Business Corporation
4-26 Act.
4-27 SECTION 4. Article 2.10, Texas Non-Profit Corporation Act
5-1 (Article 1396-2.10, Vernon's Texas Civil Statutes), is amended to
5-2 read as follows:
5-3 Art. 2.10. Meetings of Members. A. If a corporation has
5-4 members:
5-5 (1) Meetings of members shall be held at such place,
5-6 either within or without this State, as may be provided in the
5-7 by-laws. In the absence of any such provision, all meetings shall
5-8 be held at the registered office of the corporation in this State.
5-9 (2) An annual meeting of the members shall be held at
5-10 such times as may be provided in the by-laws, except that where the
5-11 by-laws of a corporation provide for more than one regular meeting
5-12 of members each year, an annual meeting shall not be required, and
5-13 directors may be elected at such meetings as the by-laws may
5-14 provide. If the by-laws designate a specific date and time for the
5-15 annual meeting, the board of directors may call the annual meeting
5-16 within ten (10) days of the designated date and time. Failure to
5-17 hold the annual meeting at the designated date and time shall not
5-18 work a dissolution of the corporation. In the event the board of
5-19 directors fails to call the annual meeting within ten (10) days of
5-20 [at] the designated date and time, any member may make demand that
5-21 such meeting be held within a reasonable time, such demand to be
5-22 made in writing by registered mail directed to any officer of the
5-23 corporation. If the annual meeting of members is not called within
5-24 sixty (60) days following such demand, any member may compel the
5-25 holding of such annual meeting by legal action directed against
5-26 said board, and all of the extraordinary writs of common law and of
5-27 courts of equity shall be available to such member to compel the
6-1 holding of such annual meeting. Each and every member is hereby
6-2 declared to have a justiciable interest sufficient to enable him to
6-3 institute and prosecute such legal proceedings.
6-4 (3) Special meetings of the members may be called by
6-5 the president, the board of directors, by members having not less
6-6 than one-tenth (1/10) of the votes entitled to be cast at such
6-7 meeting, or such other officers or persons as may be provided in
6-8 the articles of incorporation or by-laws.
6-9 SECTION 5. Article 2.11, Texas Non-Profit Corporation Act
6-10 (Article 1396-2.11, Vernon's Texas Civil Statutes), is amended by
6-11 amending Section D and adding Section E to read as follows:
6-12 D. If its by-laws so provide, a corporation having more than
6-13 fifty (50) members at the time a meeting is scheduled or called may
6-14 give notice of such meeting by newsletter mailed to each member.
6-15 E. If its by-laws so provide, a corporation having more than
6-16 one thousand (1,000) members at the time a meeting is scheduled or
6-17 called may give notice of such meeting by publication in any
6-18 newspaper of general circulation in the community in which the
6-19 principal office of such corporation is located.
6-20 SECTION 6. Section B, Article 2.13, Texas Non-Profit
6-21 Corporation Act (Article 1396-2.13, Vernon's Texas Civil Statutes),
6-22 is amended to read as follows:
6-23 B. A member may vote in person or, unless the articles of
6-24 incorporation or the by-laws otherwise provide, may vote by proxy
6-25 executed in writing by the member or by his duly authorized
6-26 attorney-in-fact. No proxy shall be valid after eleven (11) months
6-27 from the date of its execution, unless otherwise provided in the
7-1 proxy. Each proxy shall be revocable unless expressly provided
7-2 therein to be irrevocable, and in no event shall it remain
7-3 irrevocable for more than eleven (11) months. Where directors or
7-4 officers are to be elected by members, [the by-laws may provide
7-5 that] such elections may be conducted by mail, by facsimile
7-6 transmission, or by any combination of the two.
7-7 SECTION 7. Section D, Article 2.17, Texas Non-Profit
7-8 Corporation Act (Article 1396-2.17, Vernon's Texas Civil Statutes),
7-9 is amended to read as follows:
7-10 D. A director may vote in person or [(if the articles of
7-11 incorporation or the bylaws so provide)] by proxy executed in
7-12 writing by the director. No proxy shall be valid after three
7-13 months from the date of its execution. Each proxy shall be
7-14 revocable unless expressly provided therein to be irrevocable, and
7-15 unless otherwise made irrevocable by law.
7-16 SECTION 8. Article 2.20, Texas Non-Profit Corporation Act
7-17 (Article 1396-2.20, Vernon's Texas Civil Statutes), is amended to
7-18 read as follows:
7-19 Art. 2.20. OFFICERS. A. The officers of a corporation
7-20 shall consist of a president and a secretary and may also consist
7-21 of one or more vice-presidents, a treasurer, and such other
7-22 officers and assistant officers as may be deemed necessary, each of
7-23 whom shall be elected or appointed at such time and in such manner
7-24 and for such terms not exceeding three (3) years as may be
7-25 prescribed in the articles of incorporation or the by-laws. In the
7-26 absence of any such provisions, all officers shall be elected or
7-27 appointed annually by the board of directors, or, if the management
8-1 of the corporation is vested in its members, by the members. Any
8-2 two or more offices may be held by the same person, except the
8-3 offices of president and secretary. A committee duly designated
8-4 may perform the functions of any officer and the functions of any
8-5 two or more officers may be performed by a single committee,
8-6 including the functions of both president and secretary.
8-7 B. An officer shall discharge the officer's duties in good
8-8 faith, with ordinary care, and in a manner the officer reasonably
8-9 believes to be in the best interest of the corporation.
8-10 C. The officers of a corporation may be designated by such
8-11 other or additional titles as may be provided in the articles of
8-12 incorporation or the by-laws.
8-13 D. [C.] In the case of a corporation which is a church, it
8-14 shall not be necessary that there be officers as provided herein,
8-15 but such duties and responsibilities may be vested in the board of
8-16 directors or other designated body in any manner provided for in
8-17 the articles of incorporation or the by-laws.
8-18 E. [D.] In the discharge of a duty imposed or power
8-19 conferred on an officer of a corporation, the officer may in good
8-20 faith and with ordinary care rely on information, opinions,
8-21 reports, or statements, including financial statements and other
8-22 financial data, concerning the corporation or another person, that
8-23 were prepared or presented by:
8-24 (1) one or more other officers or employees of the
8-25 corporation, including members of the board of directors;
8-26 (2) legal counsel, public accountants, or other
8-27 persons as to matters the officer reasonably believes are within
9-1 the person's professional or expert competence; or
9-2 (3) in the case of religious corporations, religious
9-3 authorities and ministers, priests, rabbis, or other persons whose
9-4 position or duties in the religious organization the officer
9-5 believes justify reliance and confidence and whom the officer
9-6 believes to be reliable and competent in the matters presented.
9-7 F. [E.] An officer is not relying in good faith as required
9-8 by Section E [D] of this article if the officer has knowledge
9-9 concerning the matter in question that makes reliance otherwise
9-10 permitted by Section E [D] of this article unwarranted.
9-11 G. An officer is not deemed to have the duties of a trustee
9-12 of a trust with respect to the corporation or with respect to any
9-13 property held or administered by the corporation, including
9-14 property that may be subject to restrictions imposed by the donor
9-15 or transferor of the property.
9-16 SECTION 9. Article 2.21, Texas Non-Profit Corporation Act
9-17 (Article 1396-2.21, Vernon's Texas Civil Statutes), is amended to
9-18 read as follows:
9-19 Art. 2.21. REMOVAL OF OFFICERS. A. Any officer elected or
9-20 appointed may be removed by the persons authorized to elect or
9-21 appoint such officer with or without cause whenever in their
9-22 judgment the best interests of the corporation will be served
9-23 thereby. The removal of an officer shall be without prejudice to
9-24 the contract rights, if any, of the officer so removed. Election
9-25 or appointment of an officer or agent shall not of itself create
9-26 contract rights.
9-27 SECTION 10. Article 2.23, Texas Non-Profit Corporation Act
10-1 (Article 1396-2.23, Vernon's Texas Civil Statutes), is amended by
10-2 adding Section C to read as follows:
10-3 C. A corporation has no obligation to retain its books and
10-4 records for a given fiscal year more than three years after the
10-5 closing of such fiscal year.
10-6 SECTION 11. Article 2.24, Texas Non-Profit Corporation Act
10-7 (Article 1396-2.24, Vernon's Texas Civil Statutes), is amended to
10-8 read as follows:
10-9 Art. 2.24. DIVIDENDS PROHIBITED. A. No dividend shall be
10-10 paid and no part of the income of a corporation shall be
10-11 distributed to its members, directors, or officers unless such
10-12 member has obtained and maintained an exemption from the Internal
10-13 Revenue Service classifying the member as an organization described
10-14 in Section 501(c)(3) of the Internal Revenue Code of 1986 (26
10-15 U.S.C. Section 501(c)(3)), or corresponding provisions of any
10-16 subsequent federal tax laws. A corporation may pay compensation in
10-17 a reasonable amount to its members, directors, or officers for
10-18 services rendered, may confer benefits upon its members in
10-19 conformity with its purposes, and upon dissolution or final
10-20 liquidation may make distributions to its members, but only as
10-21 permitted by this Act.
10-22 SECTION 12. Section B, Article 3.02, Texas Non-Profit
10-23 Corporation Act (Article 1396-3.02, Vernon's Texas Civil Statutes),
10-24 is amended to read as follows:
10-25 B. Provided that charters or articles of incorporation of
10-26 corporations existing on the effective date of this Act which do
10-27 not contain one or more of the requirements listed in the foregoing
11-1 Section need not be amended for the purpose of meeting such
11-2 requirements. Any subsequent amendment or restatement of the
11-3 articles of incorporation of such corporation shall include such
11-4 requirements, except that any subsequent amendment to the articles
11-5 of incorporation need not [it shall not be necessary, in such
11-6 amended or restated articles, to] include the information required
11-7 in Subsections [(8),] (9)[,] and (10) of Section A.
11-8 SECTION 13. Section A, Article 3.05, Texas Non-Profit
11-9 Corporation Act (Article 1396-3.05, Vernon's Texas Civil Statutes),
11-10 is amended to read as follows:
11-11 A. After the issuance of the certificate of incorporation,
11-12 an organization meeting of the board of directors named in the
11-13 articles of incorporation shall be held, either within or without
11-14 this State, at the call of the incorporators or the call of a
11-15 majority of the directors named in the articles of incorporation,
11-16 for the purpose of adopting by-laws, electing officers, and for
11-17 such other purposes as may come before the meeting. The
11-18 incorporators or directors calling the meeting shall give at least
11-19 three (3) days' notice thereof either personally, by facsimile
11-20 transmission, or by mail to each director named in the articles of
11-21 incorporation, which notice shall state the time and place of the
11-22 meeting.
11-23 SECTION 14. Article 5.06, Texas Non-Profit Corporation Act
11-24 (Article 1396-5.06, Vernon's Texas Civil Statutes), is amended to
11-25 read as follows:
11-26 Art. 5.06. EFFECT OF MERGER OR CONSOLIDATION OF DOMESTIC
11-27 CORPORATIONS. A. When a [such] merger or consolidation of a
12-1 domestic corporation under Article 5.01, 5.02, or 5.07 of this Act
12-2 has been made effective [corporations has been effected]:
12-3 (1) [The several corporations parties to the plan of
12-4 merger or consolidation shall be a single corporation, which, in
12-5 the case of a merger, shall be that corporation designated in the
12-6 plan of merger as the surviving corporation, and, in the case of
12-7 consolidation, shall be the new corporation provided for in the
12-8 plan of consolidation.]
12-9 [(2)] The separate existence of every domestic
12-10 corporation that is a party to the merger, except any surviving or
12-11 new domestic [all corporations parties to the plan of merger or
12-12 consolidation, except the surviving or new] corporation, shall
12-13 cease.
12-14 (2) All rights, title, and interest to all real estate
12-15 and other property owned by each corporation that is a party to the
12-16 merger shall be vested in the [(3) Such] surviving or new
12-17 corporation without revision or impairment, [shall have all the
12-18 rights, privileges, immunities and powers and shall be subject to
12-19 all the duties and liabilities of a corporation organized under
12-20 this Act.]
12-21 [(4) Such surviving or new corporation shall thereupon
12-22 and thereafter possess all the rights, privileges, immunities and
12-23 franchises, as well of a public as of a private nature, of each of
12-24 the merging or consolidating corporations; and all property, real,
12-25 personal and mixed, and all debts due on whatever account, and all
12-26 other choses in action, and all and every other interest, of or
12-27 belonging to or due to each of the corporations so merged or
13-1 consolidated, shall be taken and deemed to be transferred to and
13-2 vested in such single corporation] without further act or deed, and
13-3 without any transfer or assignment having occurred, but subject to
13-4 any existing liens or encumbrances thereon.
13-5 (3) All [(5) Such surviving or new corporation shall
13-6 thenceforth be responsible and liable for all the] liabilities and
13-7 obligations of each corporation shall become the liabilities and
13-8 obligations of the surviving or new corporation.
13-9 (4) A [of the corporations so merged or consolidated;
13-10 and any claim existing or action or] proceeding pending by or
13-11 against any corporation may be continued as if the merger did not
13-12 occur and the [of such corporations may be prosecuted as if such
13-13 merger or consolidation had not taken place, or such] surviving or
13-14 new corporation may be substituted in the proceeding [its place.
13-15 Neither the rights of creditors nor any liens upon the property of
13-16 any such corporations shall be impaired by such merger or
13-17 consolidation].
13-18 (5) [(6)] In the case of a merger, the articles of
13-19 incorporation of the surviving corporation shall be deemed to be
13-20 amended to the extent, if any, that changes in its articles of
13-21 incorporation are stated in the plan of merger; and, in the case of
13-22 a consolidation, the statement [statements] set forth in the
13-23 articles of consolidation and which is [are] required or are
13-24 permitted to be set forth in the articles of incorporation of
13-25 corporations organized under this Act shall be deemed to be the
13-26 articles of incorporation of the new corporation.
13-27 SECTION 15. The Texas Non-Profit Corporation Act (Article
14-1 1396-1.01 et seq., Vernon's Texas Civil Statutes), is amended by
14-2 adding Article 5.10 to read as follows:
14-3 Art. 5.10. MERGERS WITH OTHER ENTITIES. A. In addition to
14-4 a merger or consolidation effected pursuant to Article 5.01, 5.02,
14-5 or 5.07 of this Act and subject to this article, a domestic
14-6 corporation may adopt a plan of merger and one or more domestic
14-7 corporations may merge with one or more domestic or foreign
14-8 corporations or other entities in accordance with Part Five of the
14-9 Texas Business Corporation Act; provided, however, that nothing in
14-10 this article shall be deemed to authorize the merger of a
14-11 charitable corporation into another entity if such charitable
14-12 corporation would thereby have its charitable status lost or
14-13 impaired; but a for-profit corporation or other entity may be
14-14 merged into one or more charitable corporations which shall
14-15 continue as the surviving entity or entities.
14-16 B. For purposes of this article, the term "merger" means:
14-17 (1) the division of a domestic corporation into two or
14-18 more domestic corporations or into a surviving corporation or one
14-19 or more domestic or foreign corporations or other entities; or
14-20 (2) the combination of one or more domestic
14-21 corporations with one or more domestic or foreign corporations or
14-22 other entities resulting in:
14-23 (a) one or more surviving domestic or foreign
14-24 corporations or other entities;
14-25 (b) the creation of one or more domestic or
14-26 foreign corporations or other entities; or
14-27 (c) one or more surviving domestic or foreign
15-1 corporations or other entities and the creation of one or more
15-2 domestic or foreign corporations or other entities.
15-3 C. For purposes of this article, the term "other entity"
15-4 means any entity, whether organized for profit or not, that is a
15-5 corporation (other than a domestic corporation or foreign
15-6 corporation), limited or general partnership, limited liability
15-7 company, real estate investment trust, joint venture, stock
15-8 company, cooperative, association, bank, trust, insurance company,
15-9 or other legal entity organized pursuant to the laws of this state
15-10 or any other state or country to the extent such laws or the
15-11 constituent documents of that entity, not inconsistent with such
15-12 laws, permit that entity to enter into a merger with a domestic
15-13 corporation as permitted by this article.
15-14 D. The procedures for approval of a merger set forth in
15-15 Article 5.03 of this Act shall also apply to any merger effected
15-16 pursuant to this article in lieu of Section A(1), Article 5.01, and
15-17 Article 5.03 of the Texas Business Corporation Act. The provisions
15-18 set forth in Article 5.04 of the Texas Business Corporation Act and
15-19 Article 5.04 of this Act with respect to articles of merger shall
15-20 both apply to any merger to the extent applicable. The effects of
15-21 any merger effected pursuant to this article shall be as set forth
15-22 in Article 5.06 of the Texas Business Corporation Act. All other
15-23 provisions of this part shall apply to a merger under this article
15-24 except to the extent the provisions of Part Five of the Texas
15-25 Business Corporation Act expressly apply to the merger and such
15-26 provisions are not in conflict with the provisions of this Act.
15-27 SECTION 16. Section E, Article 7.01, Texas Non-Profit
16-1 Corporation Act (Article 1396-7.01, Vernon's Texas Civil Statutes),
16-2 is amended to read as follows:
16-3 E. Any corporation dissolved by the Secretary of State under
16-4 the provisions of Section B of this article may be reinstated by
16-5 the Secretary of State at any time within a period of 36 [12]
16-6 months from the date of such dissolution, upon approval of an
16-7 application for reinstatement signed by an officer or director of
16-8 the dissolved corporation. Such application shall be filed by the
16-9 Secretary of State whenever it is established to the Secretary's
16-10 [his] satisfaction that in fact there was no cause for the
16-11 dissolution, or whenever the neglect, omission or delinquency
16-12 resulting in dissolution has been corrected and payment made of all
16-13 fees, taxes, penalties and interest due thereon which accrued
16-14 before the dissolution plus an amount equal to the total taxes from
16-15 the date of dissolution to the date of reinstatement which would
16-16 have been payable had the corporation not been dissolved. A
16-17 reinstatement filing fee of $25.00 shall accompany the application
16-18 for reinstatement.
16-19 Reinstatement shall not be authorized if the corporate name
16-20 is the same as or deceptively similar to a corporate, limited
16-21 partnership, or limited liability company name already on file or
16-22 reserved or registered, unless the corporation being reinstated
16-23 contemporaneously amends the articles of incorporation to change
16-24 its name.
16-25 When the application for reinstatement is approved and filed
16-26 by the Secretary of State, the corporate existence shall be deemed
16-27 to have continued without interruption from the date of dissolution
17-1 except the reinstatement shall have no effect upon any issue of
17-2 personal liability of the directors, officers, or agents of the
17-3 corporation during the period between dissolution and
17-4 reinstatement.
17-5 SECTION 17. Section A, Article 8.03, Texas Non-Profit
17-6 Corporation Act (Article 1396-8.03, Vernon's Texas Civil Statutes),
17-7 is amended to read as follows:
17-8 A. No certificate of authority shall be issued to a foreign
17-9 corporation if the corporate name of such corporation:
17-10 (1) Contains any word or phrase which indicates or
17-11 implies that it is organized for any purpose other than one or more
17-12 of the purposes contained in its articles of incorporation.
17-13 (2) Is the same as, or deceptively similar to, the
17-14 name of any corporation, whether for profit or not for profit,
17-15 limited partnership, or limited liability company existing under
17-16 any Act of this State, or any foreign corporation, whether for
17-17 profit or not for profit, limited partnership, or limited liability
17-18 company authorized to transact business or conduct affairs in this
17-19 State, or a corporate, limited partnership, or limited liability
17-20 company name reserved or registered as permitted by the laws of
17-21 this State; provided that a name may be similar if written consent
17-22 is obtained from the existing corporation, limited partnership, or
17-23 limited liability company having the name deemed to be similar or
17-24 the person[, or corporation] for whom the name deemed to be similar
17-25 is reserved or registered in the office of the Secretary of State.
17-26 A certificate of authority shall be issued as provided by this Act
17-27 to any foreign corporation having a name the same as, deceptively
18-1 similar to, or, if no consent is given, similar to the name of any
18-2 domestic corporation, limited partnership, or limited liability
18-3 company existing under the laws of this State or of any foreign
18-4 corporation, limited partnership, or limited liability company
18-5 authorized to transact business or conduct affairs in this State,
18-6 or a name the exclusive right to which is, at the time, reserved or
18-7 registered in accordance with this Act or any other applicable law,
18-8 provided the foreign corporation qualifies and does business under
18-9 a name that meets the requirements of this article. The foreign
18-10 corporation shall set forth in the application for a certificate of
18-11 authority the name under which it is qualifying and shall file an
18-12 assumed name certificate in accordance with Chapter 36, Business &
18-13 Commerce Code, as amended.
18-14 SECTION 18. Section E, Article 8.15, Texas Non-Profit
18-15 Corporation Act (Article 1396-8.15, Vernon's Texas Civil Statutes),
18-16 is amended to read as follows:
18-17 E. Any corporation whose certificate of authority has been
18-18 revoked by the Secretary of State under the provisions of Section B
18-19 of this article may be reinstated by the Secretary of State at any
18-20 time within a period of 36 [12] months from the date of such
18-21 revocation [dissolution], upon approval of an application for
18-22 reinstatement signed by an officer or director of the corporation.
18-23 Such application shall be filed by the Secretary of State whenever
18-24 it is established to the Secretary's [his] satisfaction that in
18-25 fact there was no cause for the revocation, or whenever the
18-26 neglect, omission or delinquency resulting in revocation has been
18-27 corrected and payment made of all fees, taxes, penalties and
19-1 interest due thereon which accrued before the revocation plus an
19-2 amount equal to the total taxes from the date of revocation to the
19-3 date of reinstatement which would have been payable had the
19-4 corporation's certificate not been revoked. A reinstatement filing
19-5 fee of $25.00 shall accompany the application for reinstatement.
19-6 Reinstatement shall not be authorized if the corporate name
19-7 is the same as or deceptively similar to a corporate, limited
19-8 partnership, or limited liability company name already on file or
19-9 reserved or registered, unless the corporation being reinstated
19-10 contemporaneously amends its certificate of authority to change its
19-11 name.
19-12 When the application for reinstatement is approved and filed
19-13 by the Secretary of State, the corporate authority to do business
19-14 in Texas shall be deemed to have continued without interruption
19-15 from the date of revocation, except that reinstatement shall have
19-16 no effect upon any issue of personal liability of the directors,
19-17 officers, or agents of the corporation during the period between
19-18 revocation and reinstatement.
19-19 SECTION 19. (a) This Act takes effect September 1, 1997,
19-20 and applies to an entity affected regardless of the date of
19-21 formation or incorporation.
19-22 (b) This Act shall not affect any action or proceeding
19-23 commenced before the effective date of this Act.
19-24 SECTION 20. The importance of this legislation and the
19-25 crowded condition of the calendars in both houses create an
19-26 emergency and an imperative public necessity that the
19-27 constitutional rule requiring bills to be read on three several
20-1 days in each house be suspended, and this rule is hereby suspended.