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A BILL TO BE ENTITLED
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AN ACT
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relating to names of domestic and foreign filing entities for |
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transacting business in this state; creating an offense. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 1.002, Business Organizations Code, is |
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amended by adding Subdivision (21-a) to read as follows: |
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(21-a) "Fictitious name" means an assumed name: |
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(A) that a foreign filing entity adopts for use |
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because the name of the entity as stated in the entity's certificate |
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of formation or similar organizational instrument is not available |
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for use under the laws of this state; and |
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(B) under which the foreign filing entity is |
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registered to transact business in this state, in accordance with |
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Chapter 9. |
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SECTION 2. Subchapter A, Chapter 5, Business Organizations |
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Code, is amended by adding Sections 5.002, 5.003, and 5.004 to read |
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as follows: |
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Sec. 5.002. EVIDENCE OF ESTABLISHED RIGHT TO |
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INDISTINGUISHABLE NAME. Notwithstanding Sections 5.053, 5.102, |
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and 5.153, the secretary of state may register or reserve a name |
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requested on an application for registration filed by a foreign |
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filing entity, or an application for reservation or registration of |
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a name filed by a person, that is not a distinguishable name from |
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another name that is registered or reserved in the records of the |
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secretary of state under this chapter if the foreign filing entity |
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or person delivers to the secretary of state a certified copy of the |
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final judgment of a court of competent jurisdiction that |
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establishes the entity's or person's right to the name in this |
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state. |
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Sec. 5.003. LIABILITY FOR CERTAIN FALSE WRITTEN STATEMENTS. |
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(a) This section applies only to a written statement of consent to |
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use of a name that is provided to the secretary of state under |
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Section 5.053(b), 5.102(b), or 5.153(b). |
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(b) A person may recover damages, court costs, and |
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reasonable attorney's fees if the person incurs a loss and: |
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(1) the loss is caused by a: |
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(A) forged written statement; or |
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(B) delivered written statement that constitutes |
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an offense under Section 5.004; or |
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(2) the person reasonably relies on: |
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(A) a false statement of material fact in a |
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written statement; or |
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(B) the omission in a written statement of a |
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material fact required by this code to be included in the statement. |
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(c) A person may recover under Subsection (b) from: |
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(1) each person who forged the forged written |
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statement or signed the written statement and knew when the |
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statement was signed of the false statement or omission; |
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(2) any managerial official of the entity who directed |
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the signing and delivery of the written statement who knew or should |
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have known when the statement was signed or filed of the false |
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statement or omission; or |
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(3) the entity that authorizes the delivery of the |
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written statement. |
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Sec. 5.004. DELIVERY OF FALSE STATEMENT; OFFENSE. (a) A |
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person commits an offense if the person signs or directs the |
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delivery of a written statement of consent described by Section |
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5.053(b), 5.102(b), or 5.153(b) that the person knows is materially |
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false with intent that the written statement of consent be |
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delivered on behalf of an entity to the secretary of state. |
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(b) An offense under this section is a Class A misdemeanor |
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unless the actor's intent is to defraud or harm another, in which |
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event the offense is a state jail felony. |
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SECTION 3. Section 5.053, Business Organizations Code, is |
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amended to read as follows: |
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Sec. 5.053. DISTINGUISHABLE [IDENTICAL AND DECEPTIVELY
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SIMILAR] NAMES REQUIRED [PROHIBITED]. (a) The name of a [A] filing |
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entity or the name under which [may not have a name, and] a foreign |
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filing entity registers [may not register] to transact business in |
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this state must be distinguishable in the records of the secretary |
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of state from [under a name, that is the same as, or that the
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secretary of state determines to be deceptively similar or similar
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to]: |
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(1) the name of another existing filing entity; |
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(2) the name of a foreign filing entity that is |
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registered under Chapter 9; |
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(3) the fictitious name under which a foreign filing |
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entity is registered to transact business in this state; |
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(4) a name that is reserved under Subchapter C; or |
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(5) [(4)] a name that is registered under Subchapter |
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D. |
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(b) Subsection (a) does not apply if the other entity or the |
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person for whom the name is reserved or registered, as appropriate, |
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provides to the secretary of state a notarized written statement of |
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the entity's or person's consent to the use of the [similar] name. |
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(c) If the secretary of state determines that an entity or |
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person described by Subsection (b) is consenting to the use of a |
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name that is the same as the name or fictitious name of the entity or |
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is the same as the name reserved or registered for the entity or |
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person, the entity's or person's consent is not valid. |
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SECTION 4. Section 5.102, Business Organizations Code, is |
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amended to read as follows: |
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Sec. 5.102. LIMITATION ON THE RESERVATION OF CERTAIN NAMES |
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[PROHIBITED; EXCEPTIONS]. (a) The secretary of state may [not] |
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reserve a name under this subchapter only if the name [that] is |
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distinguishable in the records of the secretary of state from [the
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same as, or that the secretary of state considers deceptively
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similar or similar to]: |
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(1) the name of an existing filing entity; |
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(2) the name of a foreign filing entity that is |
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registered under Chapter 9; |
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(3) the fictitious name under which a foreign filing |
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entity is registered to transact business in this state; |
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(4) a name that is reserved under this subchapter; or |
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(5) [(4)] a name that is registered under Subchapter |
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D. |
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(b) Subsection (a) does not apply if the other entity or the |
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person for whom the name is reserved or registered, as appropriate, |
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provides to the secretary of state a notarized written statement of |
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the entity's or person's consent to the subsequent reservation of |
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the [similar] name. |
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(c) If the secretary of state determines that an entity or |
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person described by Subsection (b) is consenting to the subsequent |
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reservation of a name that is the same as the name or fictitious |
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name of the entity or is the same as the name reserved or registered |
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for the entity or person, the entity's or person's consent is not |
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valid. |
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SECTION 5. Section 5.153, Business Organizations Code, is |
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amended to read as follows: |
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Sec. 5.153. LIMITATION ON THE REGISTRATION OF CERTAIN NAMES |
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[REGISTRATIONS PROHIBITED; EXCEPTIONS]. (a) The secretary of |
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state may [not] register a name under this subchapter only if the |
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name [that] is distinguishable in the records of the secretary of |
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state from [the same as, or that the secretary of state determines
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to be deceptively similar or similar to]: |
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(1) the name of an existing filing entity; |
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(2) the name of a foreign filing entity that is |
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registered under Chapter 9; |
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(3) the fictitious name under which a foreign filing |
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entity is registered to transact business in this state; |
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(4) a name that is reserved under Subchapter C; or |
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(5) [(4)] a name that is registered under this |
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subchapter. |
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(b) Subsection (a) does not apply if: |
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(1) the other entity or the person for whom the name is |
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reserved or registered, as appropriate, provides to the secretary |
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of state a notarized written statement of the entity's or person's |
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consent to the registration of the [similar] name; or |
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(2) the applicant is a bank, trust company, savings |
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association, or insurance company that has been in continuous |
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existence from a date that precedes the date the indistinguishable |
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[conflicting] name is filed with the secretary of state. |
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(c) If the secretary of state determines that an entity or |
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person described by Subsection (b)(1) is consenting to the |
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registration of a name that is the same as the name or fictitious |
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name of the entity or is the same as the name reserved or registered |
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for the entity or person, the entity's or person's consent is not |
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valid. |
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SECTION 6. Section 9.105, Business Organizations Code, is |
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amended to read as follows: |
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Sec. 9.105. USE OF DISTINGUISHABLE NAME REQUIRED [SIMILAR
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TO PREVIOUSLY REGISTERED NAME]. If the secretary of state |
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determines that the [a foreign filing entity's] name of a foreign |
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filing entity or the fictitious name under which it is registered to |
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transact business in this state does not comply with Chapter 5 [is
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the same as, deceptively similar to, or similar to a name of a
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filing entity or foreign filing entity as provided by or reserved or
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registered under this code], the secretary of state may not accept |
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for filing the certificate of reinstatement unless the foreign |
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filing entity contemporaneously amends its registration to change |
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its name to a name that complies with Chapter 5, or provides a |
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fictitious name under which the foreign filing entity will transact |
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business in this state that complies with Chapter 5 [obtains
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consent for the use of the similar name]. |
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SECTION 7. Section 11.203, Business Organizations Code, is |
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amended to read as follows: |
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Sec. 11.203. USE OF DISTINGUISHABLE NAME REQUIRED [SIMILAR
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TO PREVIOUSLY REGISTERED NAME]. If the secretary of state |
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determines that a filing entity's name contained in a certificate |
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of reinstatement filed under Section 11.202 does not comply with |
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Chapter 5 [is the same as, deceptively similar to, or similar to a
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name of a filing entity or foreign entity on file as provided by or
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reserved or registered under this code], the secretary of state may |
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not accept for filing the certificate of reinstatement unless the |
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filing entity contemporaneously amends its certificate of |
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formation to change its name to a name that complies with Chapter 5 |
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[or obtains consent for the use of the similar name]. |
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SECTION 8. Section 5.002, Business Organizations Code, as |
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added by this Act, applies only to an application filed on or after |
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the effective date of this Act. An application filed before the |
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effective date of this Act is governed by the law in effect on the |
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date the application was filed, and the former law is continued in |
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effect for that purpose. |
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SECTION 9. Sections 5.102 and 5.153, Business Organizations |
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Code, as amended by this Act, apply only to an application for |
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registration or reservation of a name filed on or after the |
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effective date of this Act. An application for registration or |
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reservation of a name filed before the effective date of this Act is |
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governed by the law in effect on the date the application was filed, |
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and the former law is continued in effect for that purpose. |
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SECTION 10. Sections 9.105 and 11.203, Business |
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Organizations Code, as amended by this Act, apply only to a |
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certificate of reinstatement filed on or after the effective date |
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of this Act. A certificate of reinstatement filed before the |
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effective date of this Act is governed by the law in effect on the |
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date the certificate of reinstatement was filed, and the former law |
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is continued in effect for that purpose. |
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SECTION 11. This Act takes effect June 1, 2018. |