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A BILL TO BE ENTITLED
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AN ACT
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relating to shareholder proposals submitted to certain domestic |
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corporations. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subchapter H, Chapter 21, Business Organizations |
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Code, is amended by adding Section 21.373 to read as follows: |
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Sec. 21.373. SHAREHOLDER PROPOSALS. (a) This section |
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applies only to a corporation that: |
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(1) is formed under the laws of this state; |
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(2) has a class of equity securities registered under |
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Section 12(b) of the Securities Exchange Act of 1934; |
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(3) is admitted to listing on a national securities |
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exchange; |
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(4) either: |
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(A) has its principal office in this state; or |
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(B) is admitted to listing on a stock exchange |
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that: |
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(i) has its principal office in this state; |
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and |
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(ii) has received approval by the state |
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pursuant to Subchapter C, Chapter 4005, Government Code; and |
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(5) opts into this section by amending its governing |
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documents and providing notice to shareholders in its proxy |
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statement. |
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(b) Except as otherwise provided by a corporation's |
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governing documents, to submit a matter to the shareholders for |
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approval at a shareholder meeting, a shareholder, or group of |
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shareholders, must: |
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(1) hold no less than the lesser of: |
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(A) $1,000,000 in market value of the |
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corporation's securities entitled to vote on the proposal, measured |
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at the date of submission of the proposal; or |
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(B) three percent of the corporation's |
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securities entitled to vote on the proposal; |
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(2) continuously maintain ownership in the shares |
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required by Subdivision (1) for at least six months leading up to |
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and through the shareholder meeting; and |
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(3) solicit the holders of shares representing at |
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least 67% of the voting power of shares entitled to vote on the |
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proposal. |
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(c) Subsection (b) does not apply to: |
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(1) director nominations; and |
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(2) procedural resolutions that are ancillary to the |
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conduct of the meeting. |
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(d) If this section applies to a corporation, it shall not |
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be legally permissible for the shareholders of the corporation to |
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vote on any matter submitted to a meeting of shareholders by a |
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shareholder unless: |
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(1) that proposal has been submitted in compliance |
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with subsection (b); or |
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(2) that proposal is exempt under subsection (c). |
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SECTION 2. This Act takes effect September 1, 2025. |