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78R8217 RCJ-F
By: Goolsby H.B. No. 2578
Substitute the following for H.B. No. 2578:
By: Solomons C.S.H.B. No. 2578
A BILL TO BE ENTITLED
AN ACT
relating to the use of an electronic transmission by a corporation
for purposes of giving notice, voting, or participating in a
meeting.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section A, Article 1.02, Texas Business
Corporation Act, is amended by adding Subdivision (13-a) to read as
follows:
(13-a) "Electronic transmission" means a form of
communication that:
(a) does not directly involve the physical
transmission of paper;
(b) creates a record that may be retained, retrieved,
and reviewed by the recipient; and
(c) may be directly reproduced in paper form by the
recipient through an automated process.
SECTION 2. Article 2.24, Texas Business Corporation Act, is
amended by adding Section E to read as follows:
E. Unless the articles of incorporation or bylaws provide
otherwise, a shareholder may participate in a special or annual
meeting by means of conference telephone or similar communication
equipment by which all shareholders participating in the meeting
may hear each other. A shareholder participating in a meeting by
this means is deemed to be present in person at the meeting.
SECTION 3. Part 2, Texas Business Corporation Act, is
amended by adding Article 2.25-1 to read as follows:
Art. 2.25-1. NOTICE BY ELECTRONIC TRANSMISSION. A. On
consent of a shareholder, notice from a corporation under any
provision of this Act, the articles of incorporation, or the bylaws
may be given to the shareholder by electronic transmission. The
shareholder may specify the form of electronic transmission to be
used to communicate notice. The shareholder may revoke this
consent by written notice to the corporation. The shareholder's
consent is deemed to be revoked if the corporation is unable to
deliver by electronic transmission two consecutive notices, and the
secretary, assistant secretary, or transfer agent of the
corporation, or another person responsible for delivering notice on
behalf of the corporation knows that delivery of these two
electronic transmissions was unsuccessful. The inadvertent failure
to treat the unsuccessful transmissions as a revocation of
shareholder consent does not invalidate a meeting or other action.
B. Notice under this section is deemed given when the notice
is:
(1) transmitted to a facsimile number provided by the
shareholder for the purpose of receiving notice;
(2) transmitted to an electronic mail address provided
by the shareholder for the purpose of receiving notice;
(3) posted on an electronic network and a message is
sent to the shareholder at the address provided by the shareholder
for the purpose of alerting the shareholder of a posting; or
(4) communicated to the shareholder by any other form
of electronic transmission consented to by the shareholder.
C. An affidavit of the secretary, assistant secretary,
transfer agent, or other agent of the corporation that notice has
been given by electronic transmission is, in the absence of fraud,
prima facie evidence that the notice was given.
SECTION 4. Part 2, Texas Business Corporation Act, is
amended by adding Article 2.29-1 to read as follows:
Art. 2.29-1. ELECTRONIC VOTING. By a resolution of the
board of directors of a corporation, a shareholder or shareholder's
proxy entitled to vote may be authorized to vote by electronic
transmission. The electronic transmission must contain or be
submitted with information establishing that transmission was
authorized by the shareholder or the shareholder's proxy.
SECTION 5. Article 2.37, Texas Business Corporation Act, is
amended by adding Section C to read as follows:
C. On consent of a director, notice of the date, time, place
or purpose of a regular or special meeting of the board of directors
may be given to the director by electronic transmission. The
director may specify the form of electronic transmission to be used
to communicate notice. The director may revoke this consent by
written notice to the corporation. The director's consent is
deemed to be revoked if the corporation is unable to deliver by
electronic transmission two consecutive notices, and the secretary
of the corporation or other person responsible for delivering the
notice on behalf of the corporation knows that the delivery of these
two electronic transmissions was unsuccessful. The inadvertent
failure to treat the unsuccessful transmissions as a revocation of
the director's consent does not invalidate a meeting or other
action. An affidavit of the secretary or other agent of the
corporation that notice has been given by electronic transmission
is, in the absence of fraud, prima facie evidence that the notice
was given. Notice under this section is deemed given when the
notice is:
(1) transmitted to a facsimile number provided by the
director for the purpose of receiving notice;
(2) transmitted to an electronic mail address provided
by the director for the purpose of receiving notice;
(3) posted on an electronic network and a message is
sent to the director at the address provided by the director for the
purpose of alerting the director of a posting; or
(4) communicated to the director by any other form of
electronic transmission consented to by the director.
SECTION 6. This Act takes effect immediately if it receives
a vote of two-thirds of all the members elected to each house, as
provided by Section 39, Article III, Texas Constitution. If this
Act does not receive the vote necessary for immediate effect, this
Act takes effect September 1, 2003.