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INTRODUCED
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HOUSE COMMITTEE
SUBSTITUTE
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SECTION 1. Section 1.002,
Business Organizations Code, is amended by adding Subdivision (63-a) to
read as follows:
(63-a) "Owner
liability" means personal liability for a liability or other
obligation of an organization that is imposed on a person:
(A) by statute solely
because of the person's status as an owner or member of the organization;
or
(B) by a governing
document of an organization under a provision of this code or the laws of
the organization's jurisdiction of formation that authorizes the governing
document to make one or more specified owners or members of the
organization liable in their capacity as owners or members for all or
specified liabilities or other obligations of the organization.
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SECTION 1. Section 1.002,
Business Organizations Code, is amended by adding Subdivision (63-a) to
read as follows:
(63-a) "Owner
liability" means personal liability for a liability or other
obligation of an organization that is imposed on a person:
(A) by statute solely
because of the person's status as an owner or member of the organization;
or
(B) by a governing
document of an organization under a provision of this code or the law of
the organization's jurisdiction of formation that authorizes the governing
document to make one or more specified owners or members of the
organization liable in their capacity as owners or members for all or
specified liabilities or other obligations of the organization.
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SECTION 2. Section 3.054,
Business Organizations Code, is amended.
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SECTION 2. Same as introduced
version.
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SECTION 3. Section 3.060(b),
Business Organizations Code, is amended.
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SECTION 3. Same as introduced
version.
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SECTION 4. Section 3.201(b),
Business Organizations Code, is amended to read as follows:
(b) The ownership interests
in a for-profit corporation, real estate investment trust, or professional
corporation must be certificated unless a
[the] governing document [documents] of the
entity or a resolution adopted by the governing authority of the entity provides
that some or all of any of the classes or series of [states that]
the ownership interests are uncertificated or that some or all of each
of the classes or series of the ownership interests are uncertificated.
The entity may have both
outstanding certificated and uncertificated ownership interests of the same
class or series. If a domestic entity changes the form of its ownership
interests from certificated to uncertificated, a certificated ownership
interest subject to the change becomes an uncertificated ownership interest
only after the certificate is surrendered to the domestic entity.
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SECTION 4. Section 3.201(b),
Business Organizations Code, is amended to read as follows:
(b) The ownership interests
in a for-profit corporation, real estate investment trust, or professional
corporation must be certificated, except
to the extent a [unless the]
governing document [documents] of the entity or a resolution
adopted by the governing authority of the entity provides that some or
all of the classes or series of [states that] the ownership
interests are uncertificated or that some or all of the ownership
interests in any class or series of the ownership interests are
uncertificated. The entity may have outstanding both certificated
and uncertificated ownership interests of the same class or series. If
a domestic entity changes the form of its ownership interests from
certificated to uncertificated, a certificated ownership interest subject
to the change becomes an uncertificated ownership interest only after the
certificate is surrendered to the domestic entity.
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SECTION 5. Section
10.001(e), Business Organizations Code, is amended.
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SECTION 5. Same as introduced
version.
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SECTION 6. Section 10.002(a),
Business Organizations Code, is amended to read as follows:
(a) A plan of merger must be
in writing and must include:
(1) the name of each
organization that is a party to the merger;
(2) the name of each
organization that will survive the merger;
(3) the name of each new
organization that is to be created by the plan of merger;
(4) a description of the
organizational form of each organization that is a party to the merger or
that is to be created by the plan of merger and its jurisdiction of
formation;
(5) the manner and basis,
including use of a formula, of converting or exchanging any of the
ownership or membership interests of each organization that is a party to
the merger into:
(A) ownership interests,
membership interests, obligations, rights to purchase securities, or other
securities of one or more of the surviving or new organizations;
(B) cash;
(C) other property,
including ownership interests, membership interests, obligations, rights to
purchase securities, or other securities of any other person or entity; or
(D) any combination of the
items described by Paragraphs (A)-(C);
(6) the identification of
any of the ownership or membership interests of an organization that is a
party to the merger that are:
(A) to be canceled
rather than converted or exchanged; or
(B) to remain outstanding
rather than converted or exchanged if the organization survives the merger;
(7) the certificate of
formation of each new domestic filing entity to be created by the plan of
merger;
(8) the governing documents
of each new domestic nonfiling entity to be created by the plan of merger;
and
(9) the governing documents
of each non-code organization that:
(A) is to survive the merger
or to be created by the plan of merger; and
(B) is an entity that is
not:
(i) organized under the laws
of any state or the United States; or
(ii) required to file its
certificate of formation or similar document under which the entity is
organized with the appropriate governmental authority.
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SECTION 6. Section 10.002,
Business Organizations Code, is amended by amending Subsection (a) and
adding Subsection (d) to read as follows:
(a) A plan of merger must be
in writing and must include:
(1) the name of each
organization that is a party to the merger;
(2) the name of each organization
that will survive the merger;
(3) the name of each new
organization that is to be created by the plan of merger;
(4) a description of the
organizational form of each organization that is a party to the merger or
that is to be created by the plan of merger and its jurisdiction of
formation;
(5) the manner and basis,
including use of a formula, of converting or exchanging any of the
ownership or membership interests of each organization that is a party to
the merger into:
(A) ownership interests, membership
interests, obligations, rights to purchase securities, or other securities
of one or more of the surviving or new organizations;
(B) cash;
(C) other property,
including ownership interests, membership interests, obligations, rights to
purchase securities, or other securities of any other person or entity; or
(D) any combination of the
items described by Paragraphs (A)-(C);
(6) the identification of
any of the ownership or membership interests of an organization that is a
party to the merger that are:
(A) to be canceled
rather than converted or exchanged; or
(B) to remain outstanding
rather than converted or exchanged if the organization survives the merger;
(7) the certificate of
formation of each new domestic filing entity to be created by the plan of
merger;
(8) the governing documents
of each new domestic nonfiling entity to be created by the plan of merger;
and
(9) the governing documents
of each non-code organization that:
(A) is to survive the merger
or to be created by the plan of merger; and
(B) is an entity that is
not:
(i) organized under the laws
of any state or the United States; or
(ii) required to file its
certificate of formation or similar document under which the entity is
organized with the appropriate governmental authority.
(d) Any of the terms of the plan of merger may be made dependent
on facts ascertainable outside of the plan if the manner in which those
facts will operate on the terms of the merger is clearly and expressly
stated in the plan. In this subsection, "facts" includes the
occurrence of any event, including a determination or action by any person.
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SECTION 7. Section 10.004,
Business Organizations Code, is amended.
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SECTION 7. Same as introduced
version.
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SECTION 8. Section
10.008(a), Business Organizations Code, is amended.
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SECTION 8. Same as introduced
version.
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SECTION 9. Section
10.051(f), Business Organizations Code, is amended.
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SECTION 9. Same as introduced
version.
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SECTION 10. Section 10.052(a),
Business Organizations Code, is amended to read as follows:
(a) A plan of exchange must
be in writing and must include:
(1) the name of each
domestic entity the ownership or membership interests of which are to be
acquired;
(2) the name of each
acquiring organization;
(3) if there is more than
one acquiring organization, the ownership or membership interests to be
acquired by each organization;
(4) the terms and conditions
of the exchange; and
(5) the manner and basis,
including use of a formula, of exchanging the ownership or membership interests
to be acquired for:
(A) ownership or membership
interests, obligations, rights to purchase securities, or other securities
of one or more of the acquiring organizations that is a party to the plan
of exchange;
(B) cash;
(C) other property, including
ownership or membership interests, obligations, rights to purchase
securities, or other securities of any other person or entity; or
(D) any combination of those
items.
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SECTION 10. Section 10.052,
Business Organizations Code, is amended by amending Subsection (a) and
adding Subsection (c) to read as follows:
(a) A plan of exchange must
be in writing and must include:
(1) the name of each
domestic entity the ownership or membership interests of which are to be
acquired;
(2) the name of each acquiring
organization;
(3) if there is more than
one acquiring organization, the ownership or membership interests to be
acquired by each organization;
(4) the terms and conditions
of the exchange; and
(5) the manner and basis,
including use of a formula, of exchanging the ownership or membership
interests to be acquired for:
(A) ownership or membership
interests, obligations, rights to purchase securities, or other securities
of one or more of the acquiring organizations that is a party to the plan
of exchange;
(B) cash;
(C) other property,
including ownership or membership interests, obligations, rights to
purchase securities, or other securities of any other person or entity; or
(D) any combination of those
items.
(c) Any of the terms of the plan of exchange may be made dependent
on facts ascertainable outside of the plan if the manner in which those
facts will operate on the terms of the interest exchange is clearly and
expressly stated in the plan. In this subsection, "facts"
includes the occurrence of any event, including a determination or action
by any person.
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SECTION 11. Section
10.101(f), Business Organizations Code, is amended.
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SECTION 11. Same as
introduced version.
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SECTION 12. Section 10.103(a),
Business Organizations Code, is amended to read as follows:
(a) A plan of conversion
must be in writing and must include:
(1) the name of the
converting entity;
(2) the name of the
converted entity;
(3) a statement that the
converting entity is continuing its existence in the organizational form of
the converted entity;
(4) a statement of the type
of entity that the converted entity is to be and the converted entity's
jurisdiction of formation;
(5) if Sections 10.1025 and
10.109 do not apply, the manner and basis, including use of a formula,
of converting the ownership or membership interests of the converting
entity into ownership or membership interests of the converted entity;
(6) any certificate of
formation required to be filed under this code if the converted entity is a
filing entity;
(7) the certificate of
formation or similar organizational document of the converted entity if the
converted entity is not a filing entity; and
(8) if Sections 10.1025 and
10.109 apply, a statement that the converting entity is electing to
continue its existence in its current organizational form and jurisdiction
of formation after the conversion takes effect.
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SECTION 12. Section 10.103,
Business Organizations Code, is amended by amending Subsection (a) and
adding Subsection (c) to read as follows:
(a) A plan of conversion
must be in writing and must include:
(1) the name of the
converting entity;
(2) the name of the
converted entity;
(3) a statement that the
converting entity is continuing its existence in the organizational form of
the converted entity;
(4) a statement of the type
of entity that the converted entity is to be and the converted entity's
jurisdiction of formation;
(5) if Sections 10.1025 and
10.109 do not apply, the manner and basis, including use of a formula,
of converting the ownership or membership interests of the converting
entity into ownership or membership interests of the converted entity;
(6) any certificate of
formation required to be filed under this code if the converted entity is a
filing entity;
(7) the certificate of
formation or similar organizational document of the converted entity if the
converted entity is not a filing entity; and
(8) if Sections 10.1025 and
10.109 apply, a statement that the converting entity is electing to
continue its existence in its current organizational form and jurisdiction
of formation after the conversion takes effect.
(c) Any of the terms of the plan of conversion may be made
dependent on facts ascertainable outside of the plan if the manner in which
those facts will operate on the terms of the conversion is clearly and
expressly stated in the plan. In this subsection, "facts"
includes the occurrence of any event, including a determination or action
by any person.
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SECTION 13. Section 10.151,
Business Organizations Code, is amended by amending Subsection (b) and
adding Subsection (d) to read as follows:
(b) If a certificate of
merger or exchange is required to be filed in connection with an interest
exchange or a merger, other than a merger under Section 10.006, the
certificate must be signed on behalf of each domestic entity and non-code
organization that is a party to the merger or exchange by an officer or
other authorized representative and must include:
(1) the plan of merger or
exchange or a statement certifying:
(A) the name and
organizational form of each domestic entity or non-code organization that
is a party to the merger or exchange;
(B) for a merger, the name
and organizational form of each domestic entity or non-code organization
that is to be created by the plan of merger;
(C) the name of the
jurisdiction in which each domestic entity or non-code organization named
under Paragraph (A) or (B) is incorporated or organized;
(D) for a merger, the
amendments or changes to the certificate of formation of any [each]
filing entity that is a party to the merger, or a statement that
amendments or changes are being made to the certificate of formation of any
filing entity that is a party to the merger as set forth in a restated
certificate of formation containing amendments or a certificate of
amendment attached to the certificate of merger under Subsection (d) [if
no amendments are desired to be effected by the merger, a statement to that
effect];
(E) for a merger, if no
amendments or changes to the certificate of formation of a filing entity
are made under Paragraph (D), a statement to that effect, which may include a reference to a
restated certificate of formation attached to the certificate of merger
under Subsection (d);
(F) for a merger,
that the certificate of formation of each new filing entity to be created
under the plan of merger is being filed with the certificate of merger;
(G) [(F)] that
a [signed] plan of merger or exchange is on file at the principal
place of business of each surviving, acquiring, or new domestic entity or
non-code organization, and the address of each principal place of business;
and
(H) [(G)] that
a copy of the plan of merger or exchange will be on written request
furnished without cost by each surviving, acquiring, or new domestic entity
or non-code organization to any owner or member of any domestic entity that
is a party to or created by the plan of merger or exchange and, for a
merger with multiple surviving domestic entities or non-code organizations,
to any creditor or obligee of the parties to the merger at the time of the
merger if a liability or obligation is then outstanding;
(2) if approval of the
owners or members of any domestic entity that was a party to the plan of
merger or exchange is not required by this code, a statement to that
effect; and
(3) a statement that the
plan of merger or exchange has been approved as required by the laws of the
jurisdiction of formation of each organization that is a party to the
merger or exchange and by the governing documents of those organizations.
(d) As provided by
Subsections (b)(1)(D) and (E), a certificate of merger filed under this
section may include as an attachment a certificate of amendment, a restated
certificate of formation without amendment, or a restated certificate of
formation containing amendments for any filing entity that is a party to
the merger.
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SECTION 13. Section 10.151,
Business Organizations Code, is amended by amending Subsection (b) and
adding Subsection (d) to read as follows:
(b) If a certificate of
merger or exchange is required to be filed in connection with an interest
exchange or a merger, other than a merger under Section 10.006, the
certificate must be signed on behalf of each domestic entity and non-code
organization that is a party to the merger or exchange by an officer or
other authorized representative and must include:
(1) the plan of merger or
exchange or a statement certifying:
(A) the name and
organizational form of each domestic entity or non-code organization that
is a party to the merger or exchange;
(B) for a merger, the name
and organizational form of each domestic entity or non-code organization
that is to be created by the plan of merger;
(C) the name of the
jurisdiction in which each domestic entity or non-code organization named
under Paragraph (A) or (B) is incorporated or organized;
(D) for a merger, the
amendments or changes to the certificate of formation of any [each]
filing entity that is a party to the merger, or a statement that
amendments or changes are being made to the certificate of formation of any
filing entity that is a party to the merger as set forth in a restated
certificate of formation containing amendments or a certificate of
amendment attached to the certificate of merger under Subsection (d) [if
no amendments are desired to be effected by the merger, a statement to that
effect];
(E) for a merger, if no
amendments or changes to the certificate of formation of a filing entity
are made under Paragraph (D), a statement to that effect, which may
also refer to a restated certificate of formation attached to the
certificate of merger under Subsection (d);
(F) for a merger,
that the certificate of formation of each new filing entity to be created
under the plan of merger is being filed with the certificate of merger;
(G) [(F)] that
a [signed] plan of merger or exchange is on file at the principal
place of business of each surviving, acquiring, or new domestic entity or
non-code organization, and the address of each principal place of business;
and
(H) [(G)] that
a copy of the plan of merger or exchange will be on written request
furnished without cost by each surviving, acquiring, or new domestic entity
or non-code organization to any owner or member of any domestic entity that
is a party to or created by the plan of merger or exchange and, for a
merger with multiple surviving domestic entities or non-code organizations,
to any creditor or obligee of the parties to the merger at the time of the
merger if a liability or obligation is then outstanding;
(2) if approval of the
owners or members of any domestic entity that was a party to the plan of
merger or exchange is not required by this code, a statement to that
effect; and
(3) a statement that the
plan of merger or exchange has been approved as required by the laws of the
jurisdiction of formation of each organization that is a party to the
merger or exchange and by the governing documents of those organizations.
(d) As provided by
Subsections (b)(1)(D) and (E), a certificate of merger filed under this
section may include as an attachment a certificate of amendment, a restated
certificate of formation without amendment, or a restated certificate of
formation containing amendments for any filing entity that is a party to
the merger.
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SECTION 14. Section
10.154(b), Business Organizations Code, is amended.
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SECTION 14. Same as
introduced version.
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SECTION 15. Sections
10.354(a) and (c), Business Organizations Code, are amended.
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SECTION 15. Same as
introduced version.
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SECTION 16. Section 10.355,
Business Organizations Code, is amended by adding Subsections (b-1) and (f)
and amending Subsections (c) and (d) to read as follows:
(b-1) If a corporation
effects a merger under Section 21.459(c), the responsible organization
shall provide to the shareholders of that corporation who have a right to
dissent to a plan of merger under Section 10.354 notice of their rights
under this subchapter not later than the 10th day after the effective date
of the merger. Notice required under this subsection that is given to
shareholders before the effective date of the merger may, but is not
required to, contain a reference to that date. If the notice is not given
to the shareholders until on or after the effective date of the merger, the
notice must contain a reference to that date.
(c) A notice required to be
provided under Subsection (a), [or] (b), or (b-1)
must:
(1) be accompanied by a copy
of this subchapter; and
(2) advise the owner of the
location of the responsible organization's principal executive offices to
which a notice required under Section 10.356(b)(1) or a demand under
Section 10.356(b)(3), or both, [(3)] may be provided.
(d) In addition to the
requirements prescribed by Subsection (c), a notice required to be provided:
(1) under Subsection
(a)(1) must accompany the notice of the meeting to consider the action;
(2) [, and a
notice required] under Subsection (a)(2) must be provided to:
(A) [(1)] each
owner who consents in writing to the action before the owner delivers the
written consent; and
(B) [(2)] each
owner who is entitled to vote on the action and does not consent in writing
to the action before the 11th day after the date the action takes effect;
and
(3) under Subsection
(b-1) must be provided:
(A) if given before the
consummation of the tender or exchange offer described by Section
21.459(c)(2), to each shareholder to whom that offer is made; or
(B) if given after the
consummation of the tender or exchange offer described by Section
21.459(c)(2), to each shareholder who did not tender the shareholder's
shares in that offer.
(f) If the notice given
under Subsection (b-1) did not include a reference to the effective date of
the merger, the responsible organization shall, not later than the 10th day
after that date, give a second notice to the shareholders notifying them of
the merger's effective date. If the second notice is given after the later
of the date on which the tender or exchange offer described by Section
21.459(c)(2) is consummated or the 20th day after the date notice under
Subsection (b-1) is given, then the second notice is required to be given
to only those shareholders who have made a demand under Section
10.356(b)(3).
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SECTION 16. Section 10.355,
Business Organizations Code, is amended by adding Subsections (b-1) and (f)
and amending Subsections (c) and (d) to read as follows:
(b-1) If a corporation
effects a merger under Section 21.459(c), the responsible organization
shall notify the shareholders of that corporation who have a right to
dissent to the plan of merger under Section 10.354 of their rights under
this subchapter not later than the 10th day after the effective date of the
merger. Notice required under this subsection that is given to
shareholders before the effective date of the merger may, but is not
required to, contain a statement of the merger's effective date. If the
notice is not given to the shareholders until on or after the effective
date of the merger, the notice must contain a statement of the merger's
effective date.
(c) A notice required to be
provided under Subsection (a), [or] (b), or (b-1)
must:
(1) be accompanied by a copy
of this subchapter; and
(2) advise the owner of the
location of the responsible organization's principal executive offices to
which a notice required under Section 10.356(b)(1) or a demand under
Section 10.356(b)(3), or both, [(3)] may be provided.
(d) In addition to the
requirements prescribed by Subsection (c), a notice required to be provided:
(1) under Subsection
(a)(1) must accompany the notice of the meeting to consider the action;
(2) [, and a
notice required] under Subsection (a)(2) must be provided to:
(A) [(1)] each
owner who consents in writing to the action before the owner delivers the
written consent; and
(B) [(2)] each
owner who is entitled to vote on the action and does not consent in writing
to the action before the 11th day after the date the action takes effect;
and
(3) under Subsection
(b-1) must be provided:
(A) if given before the
consummation of the tender or exchange offer described by Section
21.459(c)(2), to each shareholder to whom that offer is made; or
(B) if given after the
consummation of the tender or exchange offer described by Section
21.459(c)(2), to each shareholder who did not tender the shareholder's
shares in that offer.
(f) If the notice given
under Subsection (b-1) did not include a statement of the effective date of
the merger, the responsible organization shall, not later than the 10th day
after the effective date, give a second notice to the shareholders
notifying them of the merger's effective date. If the second notice is
given after the later of the date on which the tender or exchange offer
described by Section 21.459(c)(2) is consummated or the 20th day after the
date notice under Subsection (b-1) is given, then the second notice is required
to be given to only those shareholders who have made a demand under Section
10.356(b)(3).
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SECTION 17. Section
10.356(b), Business Organizations Code, is amended.
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SECTION 17. Same as
introduced version.
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SECTION 18. Section
11.001(3), Business Organizations Code, is amended.
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SECTION 18. Same as
introduced version.
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SECTION 19. Section 20.001,
Business Organizations Code, is amended.
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SECTION 19. Same as
introduced version.
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SECTION 20. Section 21.052,
Business Organizations Code, is amended by adding Subsection (d) to read as
follows:
(d) This section does not
affect:
(1) the authority of the
shareholders of a corporation to consent in writing to the cancellation of
an event requiring winding up in accordance with Section 21.502(1) or (2); or
(2) the authority of the
organizers of a corporation to adopt a resolution to cancel an event
requiring winding up in accordance with Section
21.502(1) or (2).
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SECTION 20. Section 21.052,
Business Organizations Code, is amended by adding Subsection (d) to read as
follows:
(d) This section does not
affect:
(1) the authority of the
shareholders of a corporation to consent in writing to the cancellation of
an event requiring winding up in accordance with Section 21.502(1); or
(2) the authority of the
organizers of a corporation to adopt a resolution to cancel an event
requiring winding up in accordance with Section
21.502(2).
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SECTION 21. Section 21.053,
Business Organizations Code, is amended.
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SECTION 21. Same as
introduced version.
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SECTION 22. Section
21.056(a), Business Organizations Code, is amended.
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SECTION 22. Same as
introduced version.
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SECTION 23. Section 21.102,
Business Organizations Code, is amended.
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SECTION 23. Same as
introduced version.
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SECTION 24. Section 21.160,
Business Organizations Code, is amended.
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SECTION 24. Same as
introduced version.
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SECTION 25. Section 21.371,
Business Organizations Code, is amended to read as follows:
Sec. 21.371. PROCEDURES IN
BYLAWS RELATING TO PROXIES. (a) A corporation may establish in the
corporation's bylaws procedures consistent with this code for determining
the validity of proxies and determining whether shares that are held of
record by a bank, broker, or other nominee are represented at a meeting of
shareholders. The procedures may incorporate rules of and determinations
made by a stock exchange or self-regulatory organization regulating the
corporation or that bank, broker, or other nominee.
(b) Subject to any
procedures or conditions as may be provided in the bylaws, the bylaws may
contain one or both of the following:
(1) a provision requiring
that, when soliciting proxies or consents with respect to an election of
directors, the corporation include in both its proxy statement and any form
of its proxy or consent, in addition to individuals nominated by the board
of directors, one or more individuals nominated by a shareholder; or
(2) a provision requiring
that the corporation reimburse expenses incurred by a shareholder in
soliciting proxies or consents with respect to an election of directors so
long as the provision does not apply to any election for which the record
date precedes the adoption of the bylaw provision.
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SECTION 25. Section 21.371,
Business Organizations Code, is amended to read as follows:
Sec. 21.371. PROCEDURES IN
BYLAWS RELATING TO PROXIES. (a) A corporation may establish in the
corporation's bylaws procedures consistent with this code for determining
the validity of proxies and determining whether shares that are held of
record by a bank, broker, or other nominee are represented at a meeting of
shareholders. The procedures may incorporate rules of and determinations
made by a stock exchange or self-regulatory organization regulating the
corporation or that bank, broker, or other nominee.
(b) The bylaws may
contain one or both of the following:
(1) a provision requiring
that, when soliciting proxies or consents with respect to an election of
directors, the corporation include in both its proxy statement and any form
of its proxy or consent, in addition to individuals nominated by the board
of directors, one or more individuals nominated by a shareholder, subject
to any procedures or conditions as may be provided in the bylaws; and
(2) a provision requiring
that the corporation reimburse expenses incurred by a shareholder in
soliciting proxies or consents with respect to an election of directors so
long as the provision does not apply to any election for which the record
date precedes the adoption of the bylaw provision, but subject to any procedures
or conditions as may be provided in the bylaws.
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SECTION 26. Section 21.459,
Business Organizations Code, is amended by adding Subsections (c), (d), and
(e) to read as follows:
(c) This subsection
applies only to a corporation that is a party to the merger and whose
shares are, immediately before the date its board of directors approves the
plan of merger, either listed on a national securities exchange or held of
record by at least 2,000 shareholders. Unless required by the corporation's
certificate of formation, a plan of merger is not required to be approved
by the shareholders of the corporation if:
(1) the plan of merger
expressly:
(A) permits or requires
the merger to be effected under this subsection; and
(B) provides that any
merger effected under this subsection shall be effected as soon as
practicable following the consummation of the offer described by
Subdivision (2);
(2) an organization
consummates a tender or exchange offer for all of the outstanding shares of
the corporation on the terms provided in the plan of merger that, absent
this subsection, would be entitled to vote on the approval of the plan of
merger, except that the offer may exclude shares of the corporation owned
at the time of the commencement of the offer by:
(A) the corporation;
(B) the organization
making the offer;
(C) any person who owns,
directly or indirectly, all of the ownership interests in the organization
making the offer; or
(D) any direct or
indirect wholly owned subsidiary of a person described by Paragraph (A),
(B), or (C);
(3) shares that are
irrevocably accepted for purchase or exchange pursuant to the consummation
of the offer described by Subdivision (2) and that are received by the
depository before the expiration of the offer in addition to the shares
that are otherwise owned by the consummating organization equal at least
the percentage of the shares, and of each class or series of those shares,
of the corporation that, absent this subsection, would be required by:
(A) Section 21.457 and,
if applicable, Section 21.458; and
(B) the certificate of
formation of the corporation to approve the plan of merger;
(4) the organization
consummating the offer described by Subdivision (2) merges with or into the
corporation pursuant to the plan of merger; and
(5) each outstanding
share of each class or series of the corporation that is the subject of and
not irrevocably accepted for purchase or exchange in the offer described by
Subdivision (2) is to be converted or exchanged in the merger into, or into
the right to receive, the same amount and kind of consideration, as
described by Section 10.002(a)(5), as to be paid or delivered for shares of
such class or series of the corporation irrevocably accepted for purchase
or exchange in the offer.
(d) In Subsection (c) and
this subsection and, as applicable, in Sections 10.355(d)(3)(B), 10.355(f),
and 10.356(b)(3)(E)(iv):
(1)
"Consummates," "consummation," or
"consummating" means irrevocably accepts for purchase or exchange
shares tendered pursuant to a tender or exchange offer.
(2)
"Depository" means an agent appointed to facilitate consummation
of the offer described by Subsection (c)(2).
(e) For purposes of
Subsection (c)(3), "received," with respect to shares, means:
(1) physical receipt of a
certificate representing shares, in the case of certificated shares; and
(2) transfer into the
depository's account or an agent's message being received by the
depository, in the case of uncertificated shares.
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SECTION 26. Section 21.459,
Business Organizations Code, is amended by adding Subsections (c), (d), and
(e) to read as follows:
(c) This subsection
applies only to a corporation that is a party to the merger and whose
shares are, immediately before the date its board of directors approves the
plan of merger, either listed on a national securities exchange or held of
record by at least 2,000 shareholders. Unless required by the corporation's
certificate of formation, a plan of merger is not required to be approved
by the shareholders of the corporation if:
(1) the plan of merger
expressly:
(A) permits or requires
the merger to be effected under this subsection; and
(B) provides that any
merger effected under this subsection shall be effected as soon as
practicable following the consummation of the offer described by
Subdivision (2);
(2) an organization
consummates a tender or exchange offer for all of the outstanding shares of
the corporation on the terms provided in the plan of merger that, absent
this subsection, would be entitled to vote on the approval of the plan of
merger, except that the offer may exclude shares of the corporation owned
at the time of the commencement of the offer by:
(A) the corporation;
(B) the organization
making the offer;
(C) any person who owns,
directly or indirectly, all of the ownership interests in the organization
making the offer; or
(D) any direct or
indirect wholly owned subsidiary of a person described by Paragraph (A),
(B), or (C);
(3) shares that are
irrevocably accepted for purchase or exchange pursuant to the consummation
of the offer described by Subdivision (2) and that are received by the
depository before the expiration of the offer in addition to the shares
that are otherwise owned by the consummating organization equal at least
the percentage of the shares, and of each class or series of those shares,
of the corporation that, absent this subsection, would be required to
approve the plan of merger by:
(A) Section 21.457 and,
if applicable, Section 21.458; and
(B) the certificate of
formation of the corporation;
(4) the organization
consummating the offer described by Subdivision (2) merges with or into the
corporation pursuant to the plan of merger; and
(5) each outstanding
share of each class or series of the corporation that is the subject of and
not irrevocably accepted for purchase or exchange in the offer described by
Subdivision (2) is to be converted or exchanged in the merger into, or into
the right to receive, the same amount and kind of consideration, as
described by Section 10.002(a)(5), as to be paid or delivered for shares of
such class or series of the corporation irrevocably accepted for purchase
or exchange in the offer.
(d) In Subsection (c) and
this subsection and, as applicable, in Sections 10.355(d)(3)(B), 10.355(f),
and 10.356(b)(3)(E)(iv):
(1)
"Consummates," "consummation," or
"consummating" means irrevocably accepts for purchase or exchange
shares tendered pursuant to a tender or exchange offer.
(2)
"Depository" means an agent appointed to facilitate consummation
of the offer described by Subsection (c)(2).
(e) For purposes of
Subsection (c)(3), "received," with respect to shares, means:
(1) physical receipt of a
certificate representing shares, in the case of certificated shares; and
(2) transfer into the
depository's account or an agent's message being received by the
depository, in the case of uncertificated shares.
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SECTION 27. Section
22.109(a), Business Organizations Code, is amended to read as follows:
(a) A [The board
of directors of a] corporation may adopt a restated certificate of
formation as provided by Subchapter B, Chapter 3, by following the same
procedure to amend its [the corporation's] certificate of
formation provided by Sections 22.104-22.107, except that:
(1) member approval
is required only if the restated certificate of formation contains an
amendment; and
(2) the members may
consent in writing, or the organizers of a corporation may adopt a
resolution, to authorize a restated certificate of formation that contains
an amendment to cancel an event requiring winding up in accordance with
Section 22.302(1)(B) or 22.302(2).
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SECTION 27. Section
22.109(a), Business Organizations Code, is amended to read as follows:
(a) A [The board
of directors of a] corporation may adopt a restated certificate of
formation as provided by Subchapter B, Chapter 3, by following the same
procedure to amend its [the corporation's] certificate of
formation provided by Sections 22.104-22.107, except that:
(1) member approval
is required only if the restated certificate of formation contains an
amendment; and
(2) the members may
consent in writing, or the organizers of a corporation may adopt a
resolution, to authorize a restated certificate of formation that contains
an amendment to cancel an event requiring winding up in accordance with
Section 22.302(1)(B) or 22.302(2), as
applicable.
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SECTION 28. Section 22.164,
Business Organizations Code, is amended by amending Subsection (b) and
adding Subsection (d) to read as follows:
(b) Except as otherwise
provided by Subsection (c) or (d), or the certificate of formation
in accordance with Section 22.162, the vote required for approval of a
fundamental action is:
(1) at least two-thirds of
the votes that members present in person or by proxy are entitled to cast
at the meeting at which the action is submitted for a vote, if the
corporation has members with voting rights;
(2) at least two-thirds of
the votes of members present at the meeting at which the action is
submitted for a vote, if the management of the affairs of the corporation is
vested in the corporation's members under Section 22.202; or
(3) the affirmative vote of
the majority of the directors in office, if the corporation has no members
or has no members with voting rights.
(d) If the corporation
has no members or has no members with voting rights and the corporation has not commenced its nonprofit
activities, the vote required for approval of a fundamental action
consisting of an amendment to the certificate of formation to cancel an
event requiring winding up or any of the actions described by Subsections
(a)(2) through (a)(6) is the affirmative vote of a majority of the
organizers or a majority of the directors in office.
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SECTION 28. Section 22.164,
Business Organizations Code, is amended by amending Subsection (b) and adding
Subsection (d) to read as follows:
(b) Except as otherwise
provided by Subsection (c) or (d) or the certificate of formation in
accordance with Section 22.162, the vote required for approval of a
fundamental action is:
(1) at least two-thirds of the
votes that members present in person or by proxy are entitled to cast at
the meeting at which the action is submitted for a vote, if the corporation
has members with voting rights;
(2) at least two-thirds of
the votes of members present at the meeting at which the action is
submitted for a vote, if the management of the affairs of the corporation
is vested in the corporation's members under Section 22.202; or
(3) the affirmative vote of
the majority of the directors in office, if the corporation has no members
or has no members with voting rights.
(d) If the corporation
has no members or has no members with voting rights and the corporation does not hold any assets and has not solicited
any assets or otherwise engaged in activities, the vote required for
approval of a fundamental action consisting of an amendment to the
certificate of formation to cancel an event requiring winding up or any of
the actions described by Subsections (a)(2) through (a)(6) is the
affirmative vote of a majority of the organizers or a majority of the
directors in office.
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SECTION 29. Section 22.302,
Business Organizations Code, is amended to read as follows:
Sec. 22.302. CERTAIN
PROCEDURES FOR APPROVAL. To approve a voluntary winding up, a
reinstatement, a cancellation of an event requiring winding up, a
revocation of a voluntary decision to wind up, or a distribution plan, a
corporation must follow the following procedures:
(1) if the corporation has
no members or has no members with voting rights and the corporation:
(A) has engaged in any nonprofit activities, the
corporation's board of directors must adopt a resolution to wind up, to
reinstate, to cancel the event requiring winding up, to revoke a voluntary
decision to wind up, or to effect the distribution plan by the vote of
directors required by Section 22.164(b)(3) [22.164]; or
(B) has not commenced its
nonprofit activities, a majority of
the organizers or the board of directors of the corporation must adopt a
resolution to wind up, to reinstate, to cancel an event requiring winding
up, to revoke a voluntary decision to wind up, or to effect the
distribution plan by the vote required by Section 22.164(d);
(2) if the management of the
affairs of the corporation is vested in the corporation's members under
Section 22.202, the winding up, reinstatement, cancellation of event
requiring winding up, revocation of voluntary decision to wind up, or
distribution plan:
(A) must be submitted to a
vote at an annual, regular, or special meeting of members; and
(B) must be approved by the
members by the vote required by Section
22.164; or
(3) if the corporation has
members with voting rights:
(A) the corporation's board
of directors must approve a resolution:
(i) recommending the winding
up, reinstatement, cancellation of event requiring winding up, revocation
of a voluntary decision to wind up, or distribution plan; and
(ii) directing that the
winding up, reinstatement, cancellation of event requiring winding up,
revocation of a voluntary decision to wind up, or distribution plan of the
corporation be submitted to a vote at an annual or special meeting of
members; and
(B) the members must approve
the action described by Paragraph (A) in accordance with Section 22.303.
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SECTION 29. Section 22.302,
Business Organizations Code, is amended to read as follows:
Sec. 22.302. CERTAIN
PROCEDURES FOR APPROVAL. To approve a voluntary winding up, a
reinstatement, a cancellation of an event requiring winding up, a
revocation of a voluntary decision to wind up, or a distribution plan, a
corporation must follow the following procedures:
(1) if the corporation has
no members or has no members with voting rights and the corporation:
(A) holds any assets or has solicited any assets or
otherwise engaged in activities, the corporation's board of
directors must adopt a resolution to wind up, to reinstate, to cancel the
event requiring winding up, to revoke a voluntary decision to wind up, or
to effect the distribution plan by the vote of directors required by
Section 22.164(b)(3) [22.164]; or
(B) does not hold any assets and has not solicited
any assets or otherwise engaged in activities, a majority of the
organizers or the board of directors of the corporation must adopt a
resolution to wind up, to reinstate, to cancel an event requiring winding
up, to revoke a voluntary decision to wind up, or to effect the
distribution plan by the vote required by Section 22.164(d);
(2) if the management of the
affairs of the corporation is vested in the corporation's members under
Section 22.202, the winding up, reinstatement, cancellation of event
requiring winding up, revocation of voluntary decision to wind up, or
distribution plan:
(A) must be submitted to a
vote at an annual, regular, or special meeting of members; and
(B) must be approved by the
members by the vote required by Section 22.164(b)(2)
[22.164]; or
(3) if the corporation has
members with voting rights:
(A) the corporation's board
of directors must approve a resolution:
(i) recommending the winding
up, reinstatement, cancellation of event requiring winding up, revocation
of a voluntary decision to wind up, or distribution plan; and
(ii) directing that the
winding up, reinstatement, cancellation of event requiring winding up,
revocation of a voluntary decision to wind up, or distribution plan of the
corporation be submitted to a vote at an annual or special meeting of
members; and
(B) the members must approve
the action described by Paragraph (A) in accordance with Section 22.303.
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SECTION 30. Chapter 21,
Business Organizations Code, is amended by adding Subchapter R to read as
follows:
SUBCHAPTER R. RATIFICATION
OF DEFECTIVE CORPORATE ACTS OR SHARES; PROCEEDINGS
Sec. 21.901.
DEFINITIONS.
Sec. 21.902. RATIFICATION
OF DEFECTIVE CORPORATE ACT AND PUTATIVE SHARES.
Sec. 21.903. RATIFICATION
OF DEFECTIVE CORPORATE ACT; ADOPTION OF RESOLUTION.
Sec. 21.904. QUORUM AND
VOTING REQUIREMENTS FOR ADOPTION OF RESOLUTION. (a) The quorum and voting
requirements applicable to the adoption of a resolution under Section
21.903 are the same as the quorum and voting requirements applicable at the
time of the adoption of a resolution for the type of defective corporate
act proposed to be ratified.
(b) Notwithstanding
Subsection (a) and except as provided by Subsection (c), if in order for a
quorum to be present or to approve the defective corporate act, a larger number or portion of directors or the
presence of specified directors would have been required by the
governing documents of the corporation, any plan or agreement to which the
corporation was a party, or any provision of the corporate statute, each of
which are in effect at the time of the defective corporate act, then the larger number or portion of such directors
must be required for a quorum to be present or the presence of such
directors must be required to adopt the resolution, as applicable.
(c) The presence or
approval of any director elected, appointed, or nominated by holders of any
class or series of which no shares are then outstanding, or by any person
that is no longer a shareholder, may not be required for a quorum to be
present or to adopt the resolution.
Sec. 21.905. SHAREHOLDER APPROVAL OF RESOLUTION REQUIRED. The
resolution adopted under Section 21.903 must be submitted to shareholders
for adoption as provided by Sections 21.906 and 21.907, unless:
(1) no other provision of
the corporate statute, no provision of the corporation's governing
documents, and no provision of any plan or agreement to which the
corporation is a party would require shareholder approval of the defective
corporate act to be ratified, either at the time of the act or at the time
when the resolution required by Section 21.903 is adopted; and
(2) the defective
corporate act to be ratified did not result from a failure to comply with
Subchapter M.
Sec. 21.906. NOTICE
REQUIREMENTS FOR RESOLUTION SUBMITTED FOR SHAREHOLDER APPROVAL.
Sec. 21.907. SHAREHOLDER
MEETING; QUORUM AND VOTING. (a) At the shareholder meeting, the quorum and
voting requirements applicable to the adoption of the resolution under
Section 21.905 shall be the same as the quorum and voting requirements
applicable at the time of such adoption by the shareholders for the type of
defective corporate act to be ratified, except as provided by this section.
(b) If the approval of a larger number or portion of
shares or of any class or series of shares or the presence of specified shareholders for a quorum to be
present or to approve the defective corporate act would have been required
by the corporation's governing documents, any plan or agreement to which
the corporation was a party, or any provision of the corporate statute in
effect as of the time of the defective corporate act, then the approval of the larger number or portion
of shares or of the class or series of shares or the presence of such specified shareholders shall be
required for a quorum to be present or to adopt the resolution, as
applicable, except that approval of shares of any class or series of which
no shares are then outstanding, or the presence of any person that is no
longer a shareholder, may not be required.
(c) The adoption of a
resolution to ratify the election of a director requires the affirmative
vote of the majority of shares present at the meeting and entitled to vote
on the election of the director, unless the governing documents of the
corporation then in effect or in effect at the time of the defective
election require or required a larger number or portion of shares to elect
the director, in which case the affirmative vote of the larger number or portion
of shares is required to ratify the election of the director.
(d) If a failure of
authorization results from the failure to comply with Subchapter M, the
ratification of the defective corporate act must require the vote set forth
by Section 21.606(2), regardless of whether that vote would have otherwise
been required.
Sec. 21.908. CERTIFICATE
OF VALIDATION. (a) If the defective corporate act ratified under this
subchapter would have required under any other provision of the corporate
statute the filing of a filing instrument or other document with the filing
officer, the corporation, instead of filing the filing instrument or other
document otherwise required by this code, shall file a certificate of
validation in accordance with Chapter 4, regardless of whether a filing
instrument or other document was previously filed with respect to the
defective corporate act.
(b) The certificate of
validation must set forth:
(1) a copy of the
resolution adopted in accordance with Sections 21.903 and 21.904, the date
of adoption of the resolution by the board of directors and, if applicable,
by the shareholders, and a statement that the resolution was adopted in
accordance with this subchapter;
(2) if a filing
instrument or document was previously filed with a filing officer under the
corporate statute in respect of the defective corporate act, the title and
date of filing of the prior filing instrument or document and any articles
or certificate of correction to the filing instrument; and
(3) the provisions that
would be required under any other section of this code to be included in
the filing instrument that otherwise would have been required to be filed
with respect to the defective corporate act under this code.
Sec. 21.909. ADOPTION OF
RESOLUTION; EFFECT ON DEFECTIVE CORPORATE ACT.
Sec. 21.910. ADOPTION OF
RESOLUTION; EFFECT ON PUTATIVE SHARES. On or after the validation
effective time, unless determined otherwise in an action brought under
Section 21.914, each putative share or fraction of a putative share issued
or purportedly issued pursuant to the defective corporate act and
identified in the resolution required by Sections 21.903 and 21.904 may not
be considered void or voidable as a result of a failure of authorization
identified in the resolution and, in the absence of any failure of
authorization not ratified, is considered to be an identical share or
fraction of a share outstanding as of the time it was purportedly issued.
Sec. 21.911. NOTICE TO
SHAREHOLDERS FOLLOWING ADOPTION OF RESOLUTION
Sec. 21.912. VALID SHARES
OR PUTATIVE SHARES.
Sec. 21.913. RATIFICATION
PROCEDURES OR COURT PROCEEDINGS CONCERNING VALIDATION NOT EXCLUSIVE. (a)
Ratification of an act or transaction under this subchapter or validation
of an act or transaction as provided by Sections 21.914 through 21.917 may not be considered to be the exclusive means
of ratifying or validating any act or transaction taken by or on behalf of
the corporation, including any defective corporate act or any issuance of
putative shares or other shares.
(b) The absence or
failure of ratification of an act or transaction in accordance with this
subchapter or of validation of an act or transaction as provided by
Sections 21.914 through 21.917 may not, of itself, affect the validity or effectiveness
of any act or transaction or the issuance of any shares properly ratified
under common law or otherwise, nor shall it
create a presumption that any such act or transaction is or was a defective
corporate act or that those shares are void or voidable.
Sec. 21.914. PROCEEDING
REGARDING VALIDITY OF DEFECTIVE CORPORATE ACTS AND SHARES.
Sec. 21.915. EXCLUSIVE
JURISDICTION.
Sec. 21.916. SERVICE.
(a) Service of an application filed under Section 21.914 on the registered
agent of a corporation or in any other manner permitted by applicable law
is considered to be service on the corporation, and no other party need be
joined in order for the district court to adjudicate the matter.
(b) If an action is
brought by a corporation under this section,
the district court may require that notice of the action be provided to
other persons identified by the court and permit those other persons to
intervene in the action.
Sec. 21.917. STATUTE OF
LIMITATIONS.
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SECTION 30. Chapter 21,
Business Organizations Code, is amended by adding Subchapter R to read as
follows:
SUBCHAPTER R. RATIFICATION
OF DEFECTIVE CORPORATE ACTS OR SHARES; PROCEEDINGS
Sec. 21.901.
DEFINITIONS.
Sec. 21.902. RATIFICATION
OF DEFECTIVE CORPORATE ACT AND PUTATIVE SHARES.
Sec. 21.903. RATIFICATION
OF DEFECTIVE CORPORATE ACT; ADOPTION OF RESOLUTION.
Sec. 21.904. QUORUM AND
VOTING REQUIREMENTS FOR ADOPTION OF RESOLUTION. (a) The quorum and voting
requirements applicable to the adoption of a resolution under Section
21.903 are the same as the quorum and voting requirements applicable at the
time of the adoption of a resolution for the type of defective corporate
act proposed to be ratified.
(b) Notwithstanding
Subsection (a) and except as provided by Subsection (c), if in order for a
quorum to be present or to approve the defective corporate act, the presence or approval of a larger number or
portion of directors or of specified directors would have been
required by the governing documents of the corporation, any plan or agreement
to which the corporation was a party, or any provision of the corporate
statute, each as in effect at the time of the defective corporate act, then
the presence or approval of the larger
number or portion of such directors or of such specified directors
must be required for a quorum to be present or to adopt the resolution, as
applicable.
(c) The presence or
approval of any director elected, appointed, or nominated by holders of any
class or series of which no shares are then outstanding, or by any person
that is no longer a shareholder, shall not be required for a quorum to be
present or to adopt the resolution.
Sec. 21.905. SHAREHOLDER ADOPTION OF RESOLUTION REQUIRED. The
resolution adopted under Section 21.903 must be submitted to shareholders
for adoption as provided by Sections 21.906 and 21.907, unless:
(1) no other provision of
the corporate statute, no provision of the corporation's governing
documents, and no provision of any plan or agreement to which the
corporation is a party would have required shareholder approval of the
defective corporate act to be ratified, either at the time of the act or at
the time when the resolution required by Section 21.903 is adopted; and
(2) the defective
corporate act to be ratified did not result from a failure to comply with
Subchapter M.
Sec. 21.906. NOTICE
REQUIREMENTS FOR RESOLUTION SUBMITTED FOR SHAREHOLDER APPROVAL.
Sec. 21.907. SHAREHOLDER
MEETING; QUORUM AND VOTING. (a) At the shareholder meeting, the quorum and
voting requirements applicable to the adoption of the resolution under
Section 21.905 shall be the same as the quorum and voting requirements
applicable at the time of such adoption by the shareholders for the type of
defective corporate act to be ratified, except as provided by this section.
(b) If the presence or approval of a larger number or
portion of shares or of any class or series of shares or of specified shareholders would have
been required for a quorum to be present or to approve the defective
corporate act, as applicable, by the corporation's governing documents, any
plan or agreement to which the corporation was a party, or any provision of
the corporate statute, each as in effect at the time of the defective
corporate act, then the presence or
approval of the larger number or portion of shares or of the class
or series of shares or of such specified
shareholders shall be required for a quorum to be present or to
adopt the resolution, as applicable, except that the presence or approval
of shares of any class or series of which no shares are then outstanding,
or of any person that is no longer a shareholder, shall not be required.
(c) The adoption of a
resolution to ratify the election of a director requires the affirmative
vote of the majority of shares present at the meeting and entitled to vote
on the election of the director, unless the governing documents of the
corporation then in effect or in effect at the time of the defective
election require or required a larger number or portion of shares to elect
the director, in which case the affirmative vote of the larger number or
portion of shares is required to ratify the election of the director.
(d) If a failure of
authorization results from the failure to comply with Subchapter M, the
ratification of the defective corporate act requires the vote set forth by
Section 21.606(2), regardless of whether that vote would have otherwise
been required.
Sec. 21.908. CERTIFICATE
OF VALIDATION. (a) If the defective corporate act ratified under this
subchapter would have required under any other provision of the corporate
statute the filing of a filing instrument or other document with the filing
officer, the corporation, instead of filing the filing instrument or other
document otherwise required by this code, shall file a certificate of
validation in accordance with Chapter 4, regardless of whether a filing
instrument or other document was previously filed with respect to the
defective corporate act.
(b) The certificate of
validation must set forth:
(1) a copy of the
resolution adopted in accordance with Sections 21.903 and 21.904, the date
of adoption of the resolution by the board of directors and, if applicable,
the date of adoption by the shareholders, and a statement that the
resolution was adopted in accordance with this subchapter;
(2) if a filing
instrument or document was previously filed with a filing officer under the
corporate statute in respect of the defective corporate act, the title and
date of filing of the prior filing instrument or document and any articles or
certificate of correction to the filing instrument; and
(3) the provisions that
would be required under any other section of this code to be included in
the filing instrument that otherwise would have been required to be filed
with respect to the defective corporate act under this code.
Sec. 21.909. ADOPTION OF
RESOLUTION; EFFECT ON DEFECTIVE CORPORATE ACT.
Sec. 21.910. ADOPTION OF
RESOLUTION; EFFECT ON PUTATIVE SHARES. On or after the validation
effective time, unless determined otherwise in an action brought under
Section 21.914, each putative share or fraction of a putative share issued
or purportedly issued pursuant to the defective corporate act and
identified in the resolution adopted under Sections 21.903 and 21.904 may
not be considered void or voidable as a result of a failure of
authorization identified in the resolution and, in the absence of any
failure of authorization not ratified, is considered to be an identical
share or fraction of a share outstanding as of the time it was purportedly
issued.
Sec. 21.911. NOTICE TO
SHAREHOLDERS FOLLOWING ADOPTION OF RESOLUTION.
Sec. 21.912. VALID SHARES
OR PUTATIVE SHARES.
Sec. 21.913. RATIFICATION
PROCEDURES OR COURT PROCEEDINGS CONCERNING VALIDATION NOT EXCLUSIVE. (a)
Ratification of an act or transaction under this subchapter or validation
of an act or transaction as provided by Sections 21.914 through 21.917 is not the exclusive means of ratifying or
validating any act or transaction taken by or on behalf of the corporation,
including any defective corporate act or any issuance of putative shares or
other shares.
(b) The absence or
failure of ratification of an act or transaction in accordance with this
subchapter or of validation of an act or transaction as provided by
Sections 21.914 through 21.917 does not, of itself, affect the validity or
effectiveness of any act or transaction or the issuance of any shares
properly ratified under common law or otherwise, nor does it create a presumption that any such act or
transaction is or was a defective corporate act or that those shares are
void or voidable.
Sec. 21.914. PROCEEDING
REGARDING VALIDITY OF DEFECTIVE CORPORATE ACTS AND SHARES.
Sec. 21.915. EXCLUSIVE
JURISDICTION.
Sec. 21.916. SERVICE.
(a) Service of an application filed under Section 21.914 on the registered
agent of a corporation or in any other manner permitted by applicable law
is considered to be service on the corporation, and no other party need be
joined in order for the district court to adjudicate the matter.
(b) If an action is
brought by a corporation under Section
21.914, the district court may require that notice of the action be
provided to other persons identified by the court and permit those other
persons to intervene in the action.
Sec. 21.917. STATUTE OF
LIMITATIONS.
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SECTION 31. This Act takes
effect September 1, 2015.
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SECTION 31. Same as
introduced version.
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