Texas 2009 - 81st Regular

Texas House Bill HB2235 Compare Versions

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1	1	81R12881 CLG-F
2	2	By: Giddings H.B. No. 2235
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to business entities and associations.
8	8	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
9	9	SECTION 1. Section 1.002, Business Organizations Code, is
10	10	amended by amending Subdivisions (10), (11), (12), and (81) and
11	11	adding Subdivisions (56-a) and (56-b) to read as follows:
12	12	(10) "Conversion" means:
13	13	(A) the continuance of a domestic entity as a
14	14	non-code organization [foreign entity] of any type;
15	15	(B) the continuance of a non-code organization
16	16	[foreign entity] as a domestic entity of any type; [or]
17	17	(C) the continuance of a domestic entity of one
18	18	type as a domestic entity of another type;
19	19	(D) the continuance of a domestic entity of one
20	20	type as a foreign entity of the same type that may be treated as a
21	21	domestication, continuance, or transfer transaction under the laws
22	22	of the jurisdiction of formation of the foreign entity; or
23	23	(E) the continuance of a foreign entity of one
24	24	type as a domestic entity of the same type that may be treated as a
25	25	domestication, continuance, or transfer transaction under the laws
26	26	of the jurisdiction of formation of the foreign entity.
27	27	(11) "Converted entity" means an organization
28	28	[entity] resulting from a conversion.
29	29	(12) "Converting entity" means an organization
30	30	[entity] as the organization [entity] existed before the
31	31	organization's [entity's] conversion.
32	32	(56-a) "Non-United States entity" means a foreign
33	33	entity formed under, and the internal affairs of which are governed
34	34	by, the laws of a non-United States jurisdiction.
35	35	(56-b) "Non-United States jurisdiction" means a
36	36	foreign country or other foreign jurisdiction that is not the
37	37	United States or a state of the United States.
38	38	(81) "Shareholder" or "holder of shares" means:
39	39	(A) the person in whose name shares issued by a
40	40	for-profit corporation, professional corporation, or real estate
41	41	investment trust are registered in the share transfer records
42	42	maintained by the for-profit corporation, professional
43	43	corporation, or real estate investment trust; or
44	44	(B) the beneficial owner of shares issued by a
45	45	for-profit corporation, whose shares are held in a voting trust or
46	46	by a nominee on the beneficial owner's behalf, to the extent of the
47	47	rights granted by a nominee statement on file with the for-profit
48	48	corporation in accordance with Sections 21.201(b) and (c).
49	49	SECTION 2. Section 2.003, Business Organizations Code, is
50	50	amended to read as follows:
51	51	Sec. 2.003. GENERAL PROHIBITED PURPOSES. A domestic entity
52	52	may not:
53	53	(1) engage in a business or activity that:
54	54	(A) is expressly unlawful or prohibited by a law
55	55	of this state; or
56	56	(B) cannot lawfully be engaged in by that entity
57	57	under state law; or
58	58	(2) operate as a:
59	59	(A) bank;
60	60	(B) trust company;
61	61	(C) savings association;
62	62	(D) insurance company;
63	63	(E) [railroad company;
64	64	[(F)] cemetery organization, except as
65	65	authorized by Chapter 711, 712, or 715, Health and Safety Code; or
66	66	(F) [(G)] abstract or title company governed by
67	67	Title 11, Insurance Code.
68	68	SECTION 3. Section 3.202, Business Organizations Code, is
69	69	amended by adding Subsection (f) to read as follows:
70	70	(f) A certificate representing ownership interests may not
71	71	be issued in bearer form.
72	72	SECTION 4. Chapter 3, Business Organizations Code, is
73	73	amended by adding Subchapter F to read as follows:
74	74	SUBCHAPTER F. EMERGENCY GOVERNANCE
75	75	Sec. 3.251. EMERGENCY DEFINED. For purposes of this
76	76	subchapter, an emergency exists if a majority of a domestic
77	77	entity's governing persons cannot readily participate in a meeting
78	78	because of the occurrence of a catastrophic event.
79	79	Sec. 3.252. PROVISIONS IN GOVERNING DOCUMENTS. (a) Except
80	80	as otherwise provided by the entity's governing documents, the
81	81	governing persons, owners, or members of a domestic entity may
82	82	adopt provisions in the entity's governing documents regarding the
83	83	management of the entity during an emergency, including provisions:
84	84	(1) prescribing procedures for calling a meeting of
85	85	the governing persons;
86	86	(2) establishing minimum requirements for
87	87	participation at the meeting of the governing persons; and
88	88	(3) designating additional or substitute governing
89	89	persons.
90	90	(b) The emergency provisions must be adopted in accordance
91	91	with:
92	92	(1) the requirements of the governing documents; and
93	93	(2) the applicable provisions of this code.
94	94	Sec. 3.253. EFFECT OF EMERGENCY PROVISIONS. The emergency
95	95	provisions adopted under Section 3.252 take effect only in the
96	96	event of an emergency. The emergency provisions will no longer be
97	97	effective after the emergency ends.
98	98	Sec. 3.254. EFFECT OF OTHER PROVISIONS IN GOVERNING
99	99	DOCUMENTS DURING EMERGENCY. A provision of an entity's governing
100	100	documents that is consistent with the emergency provisions adopted
101	101	under Section 3.252 remains in effect during an emergency.
102	102	Sec. 3.255. EFFECT OF ACTION TAKEN. An action of a domestic
103	103	entity taken in good faith in accordance with the emergency
104	104	provisions:
105	105	(1) is binding on the entity; and
106	106	(2) may not be used to impose liability on a managerial
107	107	official, employee, or agent of the entity.
108	108	SECTION 5. Section 4.005, Business Organizations Code, is
109	109	amended by adding Subsections (d) and (e) to read as follows:
110	110	(d) Subject to any qualification stated in the certificate,
111	111	a certificate issued by the secretary of state stating that a
112	112	domestic filing entity is in existence may be relied on as
113	113	conclusive evidence of the entity's existence.
114	114	(e) Subject to any qualification stated in the certificate,
115	115	a certificate issued by the secretary of state stating that a
116	116	foreign filing entity is in existence or registered may be relied on
117	117	as conclusive evidence that the foreign filing entity is registered
118	118	and authorized to transact business in this state.
119	119	SECTION 6. Section 4.101(b), Business Organizations Code,
120	120	is amended to read as follows:
121	121	(b) A certificate of correction must be signed by the person
122	122	authorized by this code to sign the filing instrument to be
123	123	corrected [act on behalf of the entity].
124	124	SECTION 7. Section 6.052, Business Organizations Code, is
125	125	amended by adding Subsection (d) to read as follows:
126	126	(d) The participation or attendance at a meeting of a person
127	127	entitled to notice of the meeting constitutes a waiver by the person
128	128	of notice of a particular matter at the meeting that is not included
129	129	in the purposes or business of the meeting described in the notice
130	130	unless the person objects to considering the matter when it is
131	131	presented.
132	132	SECTION 8. Section 6.205, Business Organizations Code, is
133	133	amended to read as follows:
134	134	Sec. 6.205. REPRODUCTION OR ELECTRONIC TRANSMISSION OF
135	135	CONSENT. (a) Any photographic, photostatic, facsimile, or
136	136	similarly reliable reproduction of a consent in writing signed by
137	137	an owner, member, or governing person of a filing entity may be
138	138	substituted or used instead of the original writing for any purpose
139	139	for which the original writing could be used, if the reproduction is
140	140	a complete reproduction of the entire original writing.
141	141	(b) Except as otherwise provided by an entity's governing
142	142	documents, an electronic transmission of a consent by an owner,
143	143	member, or governing person to the taking of an action by the entity
144	144	is considered a signed writing if the transmission contains or is
145	145	accompanied by information from which it can be determined:
146	146	(1) that the electronic transmission was transmitted
147	147	by the owner, member, or governing person; and
148	148	(2) the date on which the owner, member, or governing
149	149	person transmitted the electronic transmission.
150	150	(c) Unless the consent is otherwise dated, the date
151	151	specified in Subsection (b)(2) is the date on which the consent is
152	152	considered signed.
153	153	SECTION 9. Subchapter A, Chapter 9, Business Organizations
154	154	Code, is amended by adding Section 9.005 to read as follows:
155	155	Sec. 9.005. SUPPLEMENTAL INFORMATION REQUIRED IN
156	156	APPLICATION FOR REGISTRATION OF FOREIGN LIMITED LIABILITY COMPANY.
157	157	(a) This section applies only to a foreign limited liability
158	158	company governed by a company agreement that establishes or
159	159	provides for the establishment of a designated series of members,
160	160	managers, membership interests, or assets that has any of the
161	161	characteristics described by Subsection (b).
162	162	(b) A foreign limited liability company must state in its
163	163	application for registration as a foreign limited liability company
164	164	whether:
165	165	(1) the series has:
166	166	(A) separate rights, powers, or duties with
167	167	respect to specified property or obligations of the foreign limited
168	168	liability company; or
169	169	(B) separate profits and losses associated with
170	170	specified property or obligations of the foreign limited liability
171	171	company;
172	172	(2) any debts, liabilities, obligations, and expenses
173	173	incurred, contracted for, or otherwise existing with respect to a
174	174	particular series shall be enforceable against the assets of that
175	175	series only, and not against the assets of the company generally or
176	176	the assets of any other series; and
177	177	(3) any debts, liabilities, obligations, and expenses
178	178	incurred, contracted for, or otherwise existing with respect to the
179	179	company generally or any other series shall be enforceable against
180	180	the assets of that series.
181	181	SECTION 10. Section 9.009(a), Business Organizations Code,
182	182	is amended to read as follows:
183	183	(a) A foreign filing entity must amend its registration to
184	184	reflect:
185	185	(1) a change to its name; [or]
186	186	(2) a change in the business or activity stated in its
187	187	application for registration; and
188	188	(3) if the foreign filing entity is a limited
189	189	partnership:
190	190	(A) the admission of a new general partner;
191	191	(B) the withdrawal of a general partner; and
192	192	(C) a change in the name of the general partner
193	193	stated in its application for registration [or business or activity
194	194	has changed].
195	195	SECTION 11. Section 9.011(c), Business Organizations Code,
196	196	is amended to read as follows:
197	197	(c) A certificate from the comptroller stating that all
198	198	[franchise] taxes administered by the comptroller under Title 2,
199	199	Tax Code, have been paid must be filed with the certificate of
200	200	withdrawal in accordance with Chapter 4 if the foreign filing
201	201	entity is a taxable entity under Chapter 171, Tax Code, other than a
202	202	foreign nonprofit [professional] corporation[, foreign for-profit
203	203	corporation, or foreign limited liability company].
204	204	SECTION 12. Subchapter A, Chapter 9, Business Organizations
205	205	Code, is amended by adding Section 9.012 to read as follows:
206	206	Sec. 9.012. AUTOMATIC WITHDRAWAL ON CONVERSION TO DOMESTIC
207	207	FILING ENTITY. A foreign filing entity or foreign limited
208	208	liability partnership registered in this state that converts to a
209	209	domestic filing entity is considered to have withdrawn its
210	210	registration on the effective date of the conversion. This section
211	211	also applies to a conversion and continuance under Section 10.1025.
212	212	SECTION 13. Section 9.104(d), Business Organizations Code,
213	213	is amended to read as follows:
214	214	(d) A tax clearance letter [of eligibility] from the
215	215	comptroller stating that the foreign filing entity has satisfied
216	216	all franchise tax liabilities and its registration may be
217	217	reinstated must be filed with the certificate of reinstatement if
218	218	the foreign filing entity is a taxable entity under Chapter 171, Tax
219	219	Code, other than a foreign nonprofit [professional] corporation[,
220	220	for-profit corporation, or limited liability company].
221	221	SECTION 14. Section 9.251, Business Organizations Code, is
222	222	amended to read as follows:
223	223	Sec. 9.251. ACTIVITIES NOT CONSTITUTING TRANSACTING
224	224	BUSINESS IN THIS STATE. For purposes of this chapter, activities
225	225	that do not constitute transaction of business in this state
226	226	include:
227	227	(1) maintaining or defending an action or suit or an
228	228	administrative or arbitration proceeding, or effecting the
229	229	settlement of:
230	230	(A) such an action, suit, or proceeding; or
231	231	(B) a claim or dispute to which the entity is a
232	232	party;
233	233	(2) holding a meeting of the entity's managerial
234	234	officials, owners, or members or carrying on another activity
235	235	concerning the entity's internal affairs;
236	236	(3) maintaining a bank account;
237	237	(4) maintaining an office or agency for:
238	238	(A) transferring, exchanging, or registering
239	239	securities the entity issues; or
240	240	(B) appointing or maintaining a trustee or
241	241	depositary related to the entity's securities;
242	242	(5) voting the interest of an entity the foreign
243	243	entity has acquired;
244	244	(6) effecting a sale through an independent
245	245	contractor;
246	246	(7) creating, as borrower or lender, or acquiring
247	247	indebtedness or a mortgage or other security interest in real or
248	248	personal property;
249	249	(8) securing or collecting a debt due the entity or
250	250	enforcing a right in property that secures a debt due the entity;
251	251	(9) transacting business in interstate commerce;
252	252	(10) conducting an isolated transaction that:
253	253	(A) is completed within a period of 30 days; and
254	254	(B) is not in the course of a number of repeated,
255	255	similar transactions;
256	256	(11) in a case that does not involve an activity that
257	257	would constitute the transaction of business in this state if the
258	258	activity were one of a foreign entity acting in its own right:
259	259	(A) exercising a power of executor or
260	260	administrator of the estate of a nonresident decedent under
261	261	ancillary letters issued by a court of this state; or
262	262	(B) exercising a power of a trustee under the
263	263	will of a nonresident decedent, or under a trust created by one or
264	264	more nonresidents of this state, or by one or more foreign entities;
265	265	(12) regarding a debt secured by a mortgage or lien on
266	266	real or personal property in this state:
267	267	(A) acquiring the debt in a transaction outside
268	268	this state or in interstate commerce;
269	269	(B) collecting or adjusting a principal or
270	270	interest payment on the debt;
271	271	(C) enforcing or adjusting a right or property
272	272	securing the debt;
273	273	(D) taking an action necessary to preserve and
274	274	protect the interest of the mortgagee in the security; or
275	275	(E) engaging in any combination of transactions
276	276	described by this subdivision;
277	277	(13) investing in or acquiring, in a transaction
278	278	outside of this state, a royalty or other nonoperating mineral
279	279	interest; [or]
280	280	(14) executing [the execution of] a division order,
281	281	contract of sale, or other instrument incidental to ownership of a
282	282	nonoperating mineral interest; or
283	283	(15) owning, without more, real or personal property
284	284	in this state.
285	285	SECTION 15. Subchapter C, Chapter 10, Business
286	286	Organizations Code, is amended by adding Section 10.1025 to read as
287	287	follows:
288	288	Sec. 10.1025. CONVERSION AND CONTINUANCE. (a) A
289	289	converting entity may elect to continue its existence in its
290	290	current organizational form and jurisdiction of formation in
291	291	connection with the entity's:
292	292	(1) conversion under Section 10.101 as a domestic
293	293	entity of one organizational form into a non-United States entity
294	294	of the same organizational form; or
295	295	(2) conversion under Section 10.102 as a non-United
296	296	States entity of one organizational form into a domestic entity of
297	297	the same organizational form.
298	298	(b) The election permitted by Subsection (a) for the
299	299	converting entity to continue its existence in its current
300	300	organizational form and jurisdiction of formation must be:
301	301	(1) adopted and approved as part of the plan of
302	302	conversion for the converting entity as required by Section
303	303	10.101(b) or 10.102(b), as applicable; and
304	304	(2) permitted by, or not prohibited by and
305	305	inconsistent with, the laws of the applicable non-United States
306	306	jurisdiction.
307	307	(c) Section 10.156(2) does not apply in connection with the
308	308	filing of the certificate of conversion if the converting entity is
309	309	a domestic filing entity that elects to continue its existence in
310	310	accordance with this section.
311	311	(d) Chapter 9 does not apply to a non-United States entity
312	312	that also exists as a domestic filing entity because of a conversion
313	313	and election to continue its existence in accordance with this
314	314	section.
315	315	SECTION 16. Section 10.103(a), Business Organizations
316	316	Code, is amended to read as follows:
317	317	(a) A plan of conversion must include:
318	318	(1) the name of the converting entity;
319	319	(2) the name of the converted entity;
320	320	(3) a statement that the converting entity is
321	321	continuing its existence in the organizational form of the
322	322	converted entity;
323	323	(4) a statement of the type of entity that the
324	324	converted entity is to be and the converted entity's jurisdiction
325	325	of formation;
326	326	(5) if Sections 10.1025 and 10.109 do not apply, the
327	327	manner and basis of converting the ownership or membership
328	328	interests of the converting entity into ownership or membership
329	329	interests of the converted entity;
330	330	(6) any certificate of formation required to be filed
331	331	under this code if the converted entity is a filing entity; [and]
332	332	(7) the certificate of formation or similar
333	333	organizational document of the converted entity if the converted
334	334	entity is not a filing entity; and
335	335	(8) if Sections 10.1025 and 10.109 apply, a statement
336	336	that the converting entity is electing to continue its existence in
337	337	its current organizational form and jurisdiction of formation after
338	338	the conversion takes effect.
339	339	SECTION 17. Subchapter C, Chapter 10, Business
340	340	Organizations Code, is amended by adding Section 10.109 to read as
341	341	follows:
342	342	Sec. 10.109. SPECIAL PROVISIONS APPLYING TO CONVERSION AND
343	343	CONTINUANCE. (a) This section applies only to a converting entity
344	344	that elects to continue its existence in accordance with Section
345	345	10.1025.
346	346	(b) When the conversion of a converting entity to which this
347	347	section applies takes effect:
348	348	(1) notwithstanding Section 10.106(1), the converting
349	349	entity continues to exist both in its current organizational form
350	350	and jurisdiction of formation and, as the converted entity, in the
351	351	same organizational form in the new jurisdiction of formation;
352	352	(2) the converting entity and the converted entity,
353	353	for purposes of the laws of this state, constitute a single entity
354	354	formed, incorporated, created, or otherwise having come into being,
355	355	as applicable, and existing under the laws of this state and the
356	356	laws of the applicable non-United States jurisdiction, so long as
357	357	the entity continues to exist as a domestic entity under the laws of
358	358	this state following the conversion;
359	359	(3) if the converting entity is a domestic entity,
360	360	this code and the other laws of this state apply to the converted
361	361	entity to the same extent as the laws applied to the entity before
362	362	the conversion;
363	363	(4) if the converting entity is a non-United States
364	364	entity, the laws of the applicable non-United States jurisdiction
365	365	apply to the converted entity to the same extent as the laws applied
366	366	to the entity before the conversion;
367	367	(5) notwithstanding Section 10.106(2), all rights,
368	368	title, and interests in all property owned by the converting entity
369	369	continue to be owned by the converted entity, subject to any
370	370	existing liens or other encumbrances on the property, in both the
371	371	organizational form of the converting entity and the organizational
372	372	form of the converted entity without:
373	373	(A) reversion or impairment;
374	374	(B) further act or deed; or
375	375	(C) the occurrence of a transfer or assignment;
376	376	and
377	377	(6) notwithstanding Section 10.106(3), all
378	378	liabilities and obligations of the converting entity remain the
379	379	liabilities and obligations of the converted entity in both the
380	380	organizational form of the converting entity and the organizational
381	381	form of the converted entity without impairment or diminution
382	382	because of the conversion.
383	383	SECTION 18. Section 10.154, Business Organizations Code, is
384	384	amended by adding Subsection (c) to read as follows:
385	385	(c) In addition to complying with the requirements of
386	386	Subsections (a) and (b), if Sections 10.1025 and 10.109 apply to the
387	387	conversion, the certificate of conversion required by this section
388	388	must:
389	389	(1) be titled "Certificate of Conversion and
390	390	Continuance"; and
391	391	(2) include a statement certifying that the converting
392	392	entity is electing to continue its existence in its current
393	393	organizational form and jurisdiction of formation.
394	394	SECTION 19. Section 10.361, Business Organizations Code, is
395	395	amended by adding Subsection (g) to read as follows:
396	396	(g) The beneficial owner of an ownership interest subject
397	397	to dissenters' rights held in a voting trust or by a nominee on the
398	398	beneficial owner's behalf may file a petition described by
399	399	Subsection (a) if no agreement between the dissenting owner of the
400	400	ownership interest and the responsible organization has been
401	401	reached within the period prescribed by Section 10.358(d). When
402	402	the beneficial owner files a petition described by Subsection (a):
403	403	(1) the beneficial owner shall at that time be
404	404	considered, for purposes of this subchapter, the owner, the
405	405	dissenting owner, and the holder of the ownership interest subject
406	406	to the petition; and
407	407	(2) the dissenting owner who demanded payment under
408	408	Section 10.356 has no further rights regarding the ownership
409	409	interest subject to the petition.
410	410	SECTION 20. Section 10.366(b), Business Organizations
411	411	Code, is amended to read as follows:
412	412	(b) An owner who has demanded payment for the owner's
413	413	ownership interest under Section 10.356 is not entitled to vote or
414	414	exercise any other rights of an [another] owner with respect to the
415	415	ownership interest except the right to:
416	416	(1) receive payment for the ownership interest under
417	417	this subchapter; and
418	418	(2) bring an appropriate action to obtain relief on
419	419	the ground that the action to which the demand relates would be or
420	420	was fraudulent.
421	421	SECTION 21. Section 10.367(b), Business Organizations
422	422	Code, is amended to read as follows:
423	423	(b) On termination of the right of dissent under this
424	424	section:
425	425	(1) the dissenting owner and all persons claiming a
426	426	right under the owner are conclusively presumed to have approved
427	427	and ratified the action to which the owner dissented and are bound
428	428	by that action;
429	429	(2) the owner's right to be paid the fair value of the
430	430	owner's ownership interests ceases;
431	431	(3) [and] the owner's status as an owner of those
432	432	ownership interests is restored, as if the owner's demand for
433	433	payment of the fair value of the ownership interests had not been
434	434	made under Section 10.356, [without prejudice to any interim
435	435	proceeding] if the owner's ownership interests were not canceled,
436	436	converted, or exchanged as a result of the action or a subsequent
437	437	action;
438	438	(4) the dissenting owner is entitled to receive the
439	439	same cash, property, rights, and other consideration received by
440	440	owners of the same class and series of ownership interests held by
441	441	the owner, as if the owner's demand for payment of the fair value of
442	442	the ownership interests had not been made under Section 10.356, if
443	443	the owner's ownership interests were canceled, converted, or
444	444	exchanged as a result of the action or a subsequent action;
445	445	(5) any action of the domestic entity taken after the
446	446	date of the demand for payment by the owner under Section 10.356
447	447	will not be considered ineffective or invalid because of the
448	448	restoration of the owner's ownership interests or the other rights
449	449	or entitlements of the owner under this subsection; and
450	450	(6) [fundamental business transaction; and
451	451	[(3)] the dissenting owner is entitled to receive
452	452	dividends or other distributions made after the date of the owner's
453	453	payment demand under Section 10.356, [in the interim] to owners of
454	454	the same class and series of ownership interests held by the owner
455	455	as if the [a] demand [for the payment of the ownership interests]
456	456	had not been made [under Section 10.356], subject to any change in
457	457	or adjustment to the ownership interests because of an action taken
458	458	by the domestic entity [the cancellation or exchange of the
459	459	ownership interests] after the date of the [a] demand [under
460	460	Section 10.356 was made pursuant to a fundamental business
461	461	transaction].
462	462	SECTION 22. Section 11.101(b), Business Organizations
463	463	Code, is amended to read as follows:
464	464	(b) A certificate from the comptroller that all taxes
465	465	administered by the comptroller under Title 2, Tax Code, have been
466	466	paid must be filed with the certificate of termination [in
467	467	accordance with Chapter 4] if the filing entity is a taxable entity
468	468	under Chapter 171, Tax Code, other than a nonprofit [professional]
469	469	corporation[, for-profit corporation, or limited liability
470	470	company].
471	471	SECTION 23. Section 11.202(e), Business Organizations
472	472	Code, is amended to read as follows:
473	473	(e) A tax clearance letter [of eligibility] from the
474	474	comptroller stating that the filing entity has satisfied all
475	475	franchise tax liabilities and may be reinstated must be filed with
476	476	the certificate of reinstatement if the filing entity is a taxable
477	477	entity under Chapter 171, Tax Code, other than a nonprofit
478	478	[professional] corporation[, for-profit corporation, or limited
479	479	liability company].
480	480	SECTION 24. Section 11.253(c), Business Organizations
481	481	Code, is amended to read as follows:
482	482	(c) A certificate of reinstatement must be accompanied by:
483	483	(1) each amendment to the entity's certificate of
484	484	formation that is required by intervening events, including
485	485	circumstances requiring an amendment to the filing entity's name as
486	486	described in Section 11.203; and
487	487	(2) a tax clearance letter from the comptroller
488	488	stating that the filing entity has satisfied all franchise tax
489	489	liabilities and may be reinstated, if the filing entity is a taxable
490	490	entity under Chapter 171, Tax Code, other than a nonprofit
491	491	corporation.
492	492	SECTION 25. Section 11.314, Business Organizations Code, is
493	493	amended to read as follows:
494	494	Sec. 11.314. INVOLUNTARY WINDING UP AND TERMINATION OF
495	495	PARTNERSHIP OR LIMITED LIABILITY COMPANY. A district court in the
496	496	county in which the registered office or principal place of
497	497	business in this state of a domestic partnership or limited
498	498	liability company is located has jurisdiction to order the winding
499	499	up and termination of the domestic partnership or limited liability
500	500	company on application by:
501	501	(1) a partner in the partnership if the court
502	502	determines that:
503	503	(A) the economic purpose of the partnership is
504	504	likely to be unreasonably frustrated; or
505	505	(B) another partner has engaged in conduct
506	506	relating to the partnership's business that makes it not reasonably
507	507	practicable to carry on the business in partnership with that
508	508	partner; or
509	509	(2) an owner of the partnership or limited liability
510	510	company if the court determines that it is not reasonably
511	511	practicable to carry on the entity's business in conformity with
512	512	its governing documents.
513	513	SECTION 26. Section 12.001, Business Organizations Code, is
514	514	amended by adding Subsections (c) and (d) to read as follows:
515	515	(c) The secretary of state, on acceptance of the filing of
516	516	an instrument authorized to be filed with the secretary of state
517	517	under this code, may issue:
518	518	(1) a certificate that evidences the filing of the
519	519	instrument;
520	520	(2) a letter that acknowledges the filing of the
521	521	instrument; or
522	522	(3) a certificate that evidences the filing of the
523	523	instrument and a letter that acknowledges the filing of the
524	524	instrument.
525	525	(d) This section and Sections 12.003 and 12.004 do not apply
526	526	to a domestic real estate investment trust.
527	527	SECTION 27. Section 21.152, Business Organizations Code, is
528	528	amended by amending Subsections (a) and (c) and adding Subsection
529	529	(d) to read as follows:
530	530	(a) A corporation's certificate of formation may divide the
531	531	corporation's authorized shares into one or more classes and may
532	532	divide one or more classes into one or more series. If more than one
533	533	class or series of shares is authorized, the [The] certificate of
534	534	formation must designate each class and series of authorized shares
535	535	to distinguish that class and series from any other class or series.
536	536	(c) Shares of the same class must be identical in all
537	537	respects unless the shares have been divided into one or more
538	538	series. If the shares of a class have been divided into one or more
539	539	series, the shares may vary between series, but all shares of the
540	540	same series must [will] be identical in all respects.
541	541	(d) A corporation's certificate of formation must
542	542	authorize:
543	543	(1) one or more classes or series of shares that
544	544	together have unlimited voting rights; and
545	545	(2) one or more classes or series of shares, which may
546	546	be the same class or series of shares as those with voting rights,
547	547	that together are entitled to receive the net assets of the
548	548	corporation on winding up and termination.
549	549	SECTION 28. Section 21.153(a), Business Organizations
550	550	Code, is amended to read as follows:
551	551	(a) If more than one class or series of shares is authorized
552	552	under Section 21.152(d), the certificate of formation must state
553	553	[Each class or series of authorized shares of a corporation must
554	554	have] the designations, preferences, limitations, and relative
555	555	rights, including voting rights, of each class or series [stated in
556	556	the corporation's certificate of formation].
557	557	SECTION 29. Section 21.154(a), Business Organizations
558	558	Code, is amended to read as follows:
559	559	(a) Subject to Sections 21.152 and [Section] 21.153, if
560	560	authorized by the corporation's certificate of formation, a
561	561	corporation may issue shares that:
562	562	(1) are redeemable, at the option of the corporation,
563	563	shareholder, or other person or on the occurrence of a designated
564	564	event, subject to Sections 21.303 and 21.304;
565	565	(2) entitle the holders of the shares to cumulative,
566	566	noncumulative, or partially cumulative distributions;
567	567	(3) have preferences over any or all other classes or
568	568	series of shares with respect to payment of distributions;
569	569	(4) have preferences over any or all other classes or
570	570	series of shares with respect to the assets of the corporation on
571	571	the voluntary or involuntary winding up and termination of the
572	572	corporation;
573	573	(5) are exchangeable, at the option of the
574	574	corporation, shareholder, or other person or on the occurrence of a
575	575	designated event, for shares, obligations, indebtedness, evidence
576	576	of ownership, rights to purchase securities of the corporation or
577	577	one or more other entities, or other property or for a combination
578	578	of those rights, assets, or obligations, subject to Section 21.303;
579	579	and
580	580	(6) are convertible into shares of any other class or
581	581	series, at the option of the corporation, shareholder, or other
582	582	person or on the occurrence of a designated event.
583	583	SECTION 30. Section 21.157, Business Organizations Code, is
584	584	amended by adding Subsection (c) to read as follows:
585	585	(c) This subsection applies only to shares issued in
586	586	accordance with Subsections (a) and (b) and Sections 21.160 and
587	587	21.161 for consideration consisting, wholly or partly, of a
588	588	contract for future services or benefits or a promissory note. A
589	589	corporation may place the shares, although fully paid and
590	590	nonassessable, in escrow, or make other arrangements to restrict
591	591	the transfer of the shares, and may credit distributions made with
592	592	respect to the shares against their purchase price, until the
593	593	services are performed, the note is paid, or the benefits are
594	594	received. If the services are not performed, the note is not paid,
595	595	or the benefits are not received, the corporation may pursue
596	596	remedies provided or afforded under law or in the contract or note,
597	597	including causing the shares that are placed in escrow or
598	598	restricted to be forfeited or returned to or reacquired by the
599	599	corporation and the distributions that have been credited to be
600	600	wholly or partly returned to the corporation.
601	601	SECTION 31. Section 21.163(a), Business Organizations
602	602	Code, is amended to read as follows:
603	603	(a) A corporation may:
604	604	(1) issue fractions of a share, either certificated or
605	605	uncertificated;
606	606	(2) arrange for the disposition of fractional
607	607	interests by persons entitled to the interests;
608	608	(3) pay cash for the fair value of fractions of a share
609	609	determined when the shareholders entitled to receive the fractions
610	610	are determined; or
611	611	(4) subject to Subsection (b), issue scrip in
612	612	registered [or bearer] form that entitles the holder to receive a
613	613	certificate for a full share or an uncertificated full share on the
614	614	surrender of the scrip aggregating a full share.
615	615	SECTION 32. Section 21.171, Business Organizations Code, is
616	616	amended to read as follows:
617	617	Sec. 21.171. OUTSTANDING OR TREASURY SHARES. (a) Shares
618	618	that are issued are outstanding shares unless the shares are
619	619	treasury shares or are canceled.
620	620	(b) If there are outstanding shares, one or more shares that
621	621	together have unlimited voting rights and one or more shares that
622	622	together are entitled to receive the net assets of the corporation
623	623	on the winding up and termination of the corporation must be
624	624	outstanding shares.
625	625	(c) Treasury shares are considered to be issued shares and
626	626	not outstanding shares.
627	627	(d) [(b)] Treasury shares may not be included in the total
628	628	assets of a corporation for purposes of determining the net assets
629	629	of a corporation.
630	630	SECTION 33. Section 21.201, Business Organizations Code, is
631	631	amended to read as follows:
632	632	Sec. 21.201. REGISTERED HOLDERS AS OWNERS; SHARES HELD BY
633	633	NOMINEES. (a) Except as otherwise provided by this code and
634	634	subject to Chapter 8, Business & Commerce Code, a corporation may
635	635	consider the person registered as the owner of a share in the share
636	636	transfer records of the corporation at a particular time, including
637	637	a record date set under Section 6.101 or 6.102 or Subchapter H, as
638	638	the owner of that share at that time for purposes of:
639	639	(1) voting the share;
640	640	(2) receiving distributions on the share;
641	641	(3) transferring the share;
642	642	(4) receiving notice, exercising rights of dissent,
643	643	exercising or waiving a preemptive right, or giving proxies with
644	644	respect to that share;
645	645	(5) entering into agreements with respect to that
646	646	share in accordance with Section 6.251, 6.252, or 21.210; or
647	647	(6) any other shareholder action.
648	648	(b) A corporation may establish a procedure by which the
649	649	corporation recognizes as a shareholder the beneficial owner of
650	650	shares registered in the name of a nominee.
651	651	(c) A procedure established under Subsection (b) must:
652	652	(1) determine the extent of the corporation's
653	653	recognition of the beneficial owner as a shareholder; and
654	654	(2) include the nominee's filing of a statement with
655	655	the corporation that contains information regarding the beneficial
656	656	owner.
657	657	(d) A procedure established under Subsection (b) may set
658	658	forth:
659	659	(1) the types of nominees to which the procedure
660	660	applies;
661	661	(2) the rights or privileges that the corporation will
662	662	recognize in a beneficial owner, to the extent that the rights or
663	663	privileges are not inconsistent with Section 10.361(g);
664	664	(3) the manner in which the procedure is selected by
665	665	the nominee;
666	666	(4) the information that must be provided when the
667	667	procedure is selected;
668	668	(5) the period for which the selection of the
669	669	procedure is effective; and
670	670	(6) any other aspect of the rights and duties to be
671	671	established under the procedure.
672	672	SECTION 34. Section 21.224, Business Organizations Code,
673	673	is amended to read as follows:
674	674	Sec. 21.224. PREEMPTION OF LIABILITY. The liability of a
675	675	holder, beneficial owner, or subscriber of shares of a corporation,
676	676	or any affiliate of such a holder, owner, or subscriber or of the
677	677	corporation, for an obligation that is limited by Section 21.223 is
678	678	exclusive and preempts any other liability imposed for that
679	679	obligation under common law or otherwise.
680	680	SECTION 35. Section 21.361(a), Business Organizations
681	681	Code, is amended to read as follows:
682	682	(a) At [If expressly authorized by a corporation's
683	683	certificate of formation in general or with respect to a specified
684	684	class or series of shares or group of classes or series of shares
685	685	and subject to Subsections (b) and (c), at] each election of
686	686	directors of the corporation, each shareholder entitled to vote at
687	687	the election is entitled to:
688	688	(1) vote the number of shares owned by the shareholder
689	689	for as many candidates as there are directors to be elected and for
690	690	whose election the shareholder is entitled to vote; or
691	691	(2) if expressly authorized by a corporation's
692	692	certificate of formation in general or with respect to a specified
693	693	class or series of shares or group of classes or series of shares
694	694	and subject to Subsections (b) and (c), cumulate votes by:
695	695	(A) giving one candidate as many votes as the
696	696	total of the number of the directors to be elected multiplied by the
697	697	shareholder's shares; or
698	698	(B) distributing the votes among one or more
699	699	candidates using the same principle.
700	700	SECTION 36. Section 21.406(a), Business Organizations
701	701	Code, is amended to read as follows:
702	702	(a) The certificate of formation of a corporation may
703	703	provide that directors, regardless of whether elected by the
704	704	holders of a class or series of shares or by a group of classes or
705	705	series of shares [entitled to elect one or more directors], as
706	706	provided by Section 21.405, are entitled to cast more or less than
707	707	one vote on all matters or on specified matters. Such a provision
708	708	also applies to directors voting in any committee or subcommittee
709	709	regarding all matters or the specified matters, as applicable,
710	710	unless otherwise provided by the certificate of formation.
711	711	SECTION 37. Section 21.418(b), Business Organizations
712	712	Code, is amended to read as follows:
713	713	(b) An otherwise valid contract or transaction described by
714	714	Subsection (a) is valid notwithstanding that the [a] director or
715	715	officer having the relationship or interest described by Subsection
716	716	(a) [of the corporation] is present at or participates in the
717	717	meeting of the board of directors, or of a committee of the board
718	718	that authorizes the contract or transaction, or votes or signs, in
719	719	the person's capacity as a director or committee member, a
720	720	unanimous written consent of directors or committee members to
721	721	authorize the contract or transaction, if:
722	722	(1) the material facts as to the relationship or
723	723	interest described by Subsection (a) and as to the contract or
724	724	transaction are disclosed to or known by:
725	725	(A) the corporation's board of directors or a
726	726	committee of the board of directors and the board of directors or
727	727	committee in good faith authorizes the contract or transaction by
728	728	the approval [affirmative vote] of the majority of the
729	729	disinterested directors or committee members, regardless of
730	730	whether the disinterested directors or committee members
731	731	constitute a quorum; or
732	732	(B) the shareholders entitled to vote on the
733	733	authorization of the contract or transaction, and the contract or
734	734	transaction is specifically approved in good faith by a vote of the
735	735	shareholders; or
736	736	(2) the contract or transaction is fair to the
737	737	corporation when the contract or transaction is authorized,
738	738	approved, or ratified by the board of directors, a committee of the
739	739	board of directors, or the shareholders.
740	740	SECTION 38. Section 101.054(a), Business Organizations
741	741	Code, is amended to read as follows:
742	742	(a) Except as provided by this section, the following
743	743	provisions may not be waived or modified in the company agreement of
744	744	a limited liability company:
745	745	(1) this section;
746	746	(2) Section 101.101 [101.101(b)], 101.151, 101.206,
747	747	101.501, or 101.502;
748	748	(3) Chapter 1, if the provision is used to interpret a
749	749	provision or define a word or phrase contained in a section listed
750	750	in this subsection;
751	751	(4) Chapter 2, except that Section 2.104(c)(2),
752	752	2.104(c)(3), or 2.113 may be waived or modified in the company
753	753	agreement;
754	754	(5) Chapter 3, except that Subchapters C and E may be
755	755	waived or modified in the company agreement; or
756	756	(6) Chapter 4, 5, 7, 10, 11, or 12, other than Section
757	757	11.056.
758	758	SECTION 39. Section 101.106, Business Organizations Code,
759	759	is amended by adding Subsection (c) to read as follows:
760	760	(c) Sections 9.406 and 9.408, Business & Commerce Code, do
761	761	not apply to a membership interest in a limited liability company,
762	762	including the rights, powers, and interests arising under the
763	763	company's certificate of formation or company agreement or under
764	764	this code. To the extent of any conflict between this subsection
765	765	and Section 9.406 or 9.408, Business & Commerce Code, this
766	766	subsection controls. It is the express intent of this subsection to
767	767	permit the enforcement, as a contract among the members of a limited
768	768	liability company, of any provision of a company agreement that
769	769	would otherwise be ineffective under Section 9.406 or 9.408,
770	770	Business & Commerce Code.
771	771	SECTION 40. Section 101.112(c), Business Organizations
772	772	Code, is amended to read as follows:
773	773	(c) A charging order constitutes a lien on the judgment
774	774	debtor's membership interest. The charging order lien may not be
775	775	foreclosed on under this code or any other law.
776	776	SECTION 41. Section 101.206, Business Organizations Code,
777	777	is amended by amending Subsections (a) and (d) and adding
778	778	Subsection (f) to read as follows:
779	779	(a) Unless the distribution is made in compliance with
780	780	Chapter 11, a [A] limited liability company may not make a
781	781	distribution to a member of the company if, immediately after
782	782	making the distribution, the company's total liabilities, other
783	783	than liabilities described by Subsection (b), exceed the fair value
784	784	of the company's total assets.
785	785	(d) A member of a limited liability company who receives a
786	786	distribution from the company in violation of this section is not
787	787	required to return the distribution to the company unless [if] the
788	788	member had knowledge of the violation.
789	789	(f) For purposes of this section, "distribution" does not
790	790	include an amount constituting reasonable compensation for present
791	791	or past services or a reasonable payment made in the ordinary course
792	792	of business under a bona fide retirement plan or other benefits
793	793	program.
794	794	SECTION 42. Subchapter E, Chapter 101, Business
795	795	Organizations Code, is amended by adding Section 101.208 to read as
796	796	follows:
797	797	Sec. 101.208. RECORD DATE. A company agreement may
798	798	establish or provide for the establishment of a record date with
799	799	respect to allocations and distributions.
800	800	SECTION 43. The heading to Section 101.251, Business
801	801	Organizations Code, is amended to read as follows:
802	802	Sec. 101.251. GOVERNING AUTHORITY [MEMBERSHIP].
803	803	SECTION 44. Section 101.255(b), Business Organizations
804	804	Code, is amended to read as follows:
805	805	(b) An otherwise valid contract or transaction described by
806	806	Subsection (a) is valid notwithstanding that the [a] governing
807	807	person or officer having the relationship or interest described by
808	808	Subsection (a) [of the company] is present at or participates in the
809	809	meeting of the governing authority, or of a committee of the
810	810	governing [person's] authority, that authorizes the contract or
811	811	transaction or votes or signs, in the person's capacity as a
812	812	governing person or committee member, a written consent of
813	813	governing persons or committee members to authorize the contract or
814	814	transaction, if:
815	815	(1) the material facts as to the relationship or
816	816	interest described by Subsection (a) and as to the contract or
817	817	transaction are disclosed to or known by:
818	818	(A) the company's governing authority or a
819	819	committee of the governing authority and the governing authority or
820	820	committee in good faith authorizes the contract or transaction by
821	821	the approval [affirmative vote] of the majority of the
822	822	disinterested governing persons or committee members, regardless
823	823	of whether the disinterested governing persons or committee members
824	824	constitute a quorum; or
825	825	(B) the members of the company, and the members
826	826	in good faith approve the contract or transaction by vote of the
827	827	members; or
828	828	(2) the contract or transaction is fair to the company
829	829	when the contract or transaction is authorized, approved, or
830	830	ratified by the governing authority, a committee of the governing
831	831	authority, or the members of the company.
832	832	SECTION 45. Chapter 101, Business Organizations Code, is
833	833	amended by adding Subchapter M to read as follows:
834	834	SUBCHAPTER M. SERIES LIMITED LIABILITY COMPANY
835	835	Sec. 101.601. SERIES OF MEMBERS, MANAGERS, MEMBERSHIP
836	836	INTERESTS, OR ASSETS. (a) A company agreement may establish or
837	837	provide for the establishment of one or more designated series of
838	838	members, managers, membership interests, or assets that:
839	839	(1) has separate rights, powers, or duties with
840	840	respect to specified property or obligations of the limited
841	841	liability company or profits and losses associated with specified
842	842	property or obligations; or
843	843	(2) has a separate business purpose or investment
844	844	objective.
845	845	(b) A series established in accordance with Subsection (a)
846	846	may carry on any business, purpose, or activity, whether or not for
847	847	profit, that is not prohibited by Section 2.003.
848	848	Sec. 101.602. ENFORCEABILITY OF OBLIGATIONS AND EXPENSES OF
849	849	SERIES AGAINST ASSETS. (a) Notwithstanding any other provision of
850	850	this chapter or any other law, but subject to Subsection (b) and any
851	851	other provision of this subchapter:
852	852	(1) the debts, liabilities, obligations, and expenses
853	853	incurred, contracted for, or otherwise existing with respect to a
854	854	particular series shall be enforceable against the assets of that
855	855	series only, and shall not be enforceable against the assets of the
856	856	limited liability company generally or any other series; and
857	857	(2) none of the debts, liabilities, obligations, and
858	858	expenses incurred, contracted for, or otherwise existing with
859	859	respect to the limited liability company generally or any other
860	860	series shall be enforceable against the assets of a particular
861	861	series.
862	862	(b) Subsection (a) applies only if:
863	863	(1) the records maintained for that particular series
864	864	account for the assets associated with that series separately from
865	865	the other assets of the company or any other series;
866	866	(2) the company agreement contains a statement to the
867	867	effect of the limitations provided in Subsection (a); and
868	868	(3) the company's certificate of formation contains a
869	869	notice of the limitations provided in Subsection (a).
870	870	Sec. 101.603. ASSETS OF SERIES. (a) Assets associated with
871	871	a series may be held directly or indirectly, including being held in
872	872	the name of the series, in the name of the limited liability
873	873	company, through a nominee, or otherwise.
874	874	(b) If the records of a series are maintained in a manner so
875	875	that the assets of the series can be reasonably identified by
876	876	specific listing, category, type, quantity, or computational or
877	877	allocational formula or procedure, including a percentage or share
878	878	of any assets, or by any other method in which the identity of the
879	879	assets can be objectively determined, the records are considered to
880	880	satisfy the requirements of Section 101.602(b)(1).
881	881	Sec. 101.604. NOTICE OF LIMITATION ON LIABILITIES OF
882	882	SERIES. Notice of the limitation on liabilities of a series
883	883	required by Section 101.602 that is contained in a certificate of
884	884	formation filed with the secretary of state satisfies the
885	885	requirements of Section 101.602(b)(3), regardless of whether:
886	886	(1) the limited liability company has established any
887	887	series under this subchapter when the notice is contained in the
888	888	certificate of formation; and
889	889	(2) the notice makes a reference to a specific series
890	890	of the limited liability company.
891	891	Sec. 101.605. GENERAL POWERS OF SERIES. A series
892	892	established under this subchapter has the power and capacity, in
893	893	the series' own name, to:
894	894	(1) sue and be sued;
895	895	(2) contract;
896	896	(3) hold title to assets of the series, including real
897	897	property, personal property, and intangible property; and
898	898	(4) grant liens and security interests in assets of
899	899	the series.
900	900	Sec. 101.606. LIABILITY OF MEMBER OR MANAGER FOR
901	901	OBLIGATIONS; DUTIES. (a) Except as and to the extent the company
902	902	agreement specifically provides otherwise, a member or manager
903	903	associated with a series or a member or manager of the company is
904	904	not liable for a debt, obligation, or liability of a series,
905	905	including a debt, obligation, or liability under a judgment,
906	906	decree, or court order.
907	907	(b) The company agreement may expand or restrict any duties,
908	908	including fiduciary duties, and related liabilities that a member,
909	909	manager, officer, or other person associated with a series has to:
910	910	(1) the series or the company;
911	911	(2) a member or manager associated with the series; or
912	912	(3) a member or manager of the company.
913	913	Sec. 101.607. CLASS OR GROUP OF MEMBERS OR MANAGERS. (a)
914	914	The company agreement may:
915	915	(1) establish classes or groups of one or more members
916	916	or managers associated with a series each of which has certain
917	917	express relative rights, powers, and duties, including voting
918	918	rights; and
919	919	(2) provide for the manner of establishing additional
920	920	classes or groups of one or more members or managers associated with
921	921	the series each of which has certain express rights, powers, and
922	922	duties, including providing for voting rights and rights, powers,
923	923	and duties senior to existing classes and groups of members or
924	924	managers associated with the series.
925	925	(b) The company agreement may provide for the taking of an
926	926	action, including the amendment of the company agreement, without
927	927	the vote or approval of any member or manager or class or group of
928	928	members or managers, to create under the provisions of the company
929	929	agreement a class or group of the series of membership interests
930	930	that was not previously outstanding.
931	931	(c) The company agreement may provide that:
932	932	(1) all or certain identified members or managers or a
933	933	specified class or group of the members or managers associated with
934	934	a series have the right to vote on any matter separately or with all
935	935	or any class or group of the members or managers associated with the
936	936	series;
937	937	(2) any member or class or group of members associated
938	938	with a series has no voting rights; and
939	939	(3) voting by members or managers associated with a
940	940	series is on a per capita, number, financial interest, class,
941	941	group, or any other basis.
942	942	Sec. 101.608. GOVERNING AUTHORITY. (a) Notwithstanding
943	943	any conflicting provision of the certificate of formation of a
944	944	limited liability company, the governing authority of a series
945	945	consists of the managers or members associated with the series as
946	946	provided in the company agreement.
947	947	(b) If the company agreement does not provide for the
948	948	governing authority of the series, the governing authority of the
949	949	series consists of:
950	950	(1) the managers associated with the series, if the
951	951	company's certificate of formation states that the company will
952	952	have one or more managers; or
953	953	(2) the members associated with the series, if the
954	954	company's certificate of formation states that the company will not
955	955	have managers.
956	956	Sec. 101.609. APPLICABILITY OF OTHER PROVISIONS OF CHAPTER;
957	957	SYNONYMOUS TERMS. (a) To the extent not inconsistent with this
958	958	subchapter, this chapter applies to a series and its associated
959	959	members and managers.
960	960	(b) For purposes of the application of any other provision
961	961	of this chapter to a provision of this subchapter, and as the
962	962	context requires:
963	963	(1) a reference to "limited liability company" or
964	964	"company" means the "series";
965	965	(2) a reference to "member" means "member associated
966	966	with the series"; and
967	967	(3) a reference to "manager" means "manager associated
968	968	with the series."
969	969	Sec. 101.610. EFFECT OF CERTAIN EVENT ON MANAGER OR MEMBER.
970	970	(a) An event that under this chapter or the company agreement
971	971	causes a manager to cease to be a manager with respect to a series
972	972	does not, in and of itself, cause the manager to cease to be a
973	973	manager of the limited liability company or with respect to any
974	974	other series of the company.
975	975	(b) An event that under this chapter or the company
976	976	agreement causes a member to cease to be associated with a series
977	977	does not, in and of itself, cause the member to cease to be
978	978	associated with any other series or terminate the continued
979	979	membership of a member in the limited liability company or require
980	980	the winding up of the series, regardless of whether the member was
981	981	the last remaining member associated with the series.
982	982	Sec. 101.611. MEMBER STATUS WITH RESPECT TO DISTRIBUTION.
983	983	(a) Subject to Sections 101.613, 101.617, 101.618, 101.619, and
984	984	101.620, when a member associated with a series established under
985	985	this subchapter is entitled to receive a distribution with respect
986	986	to the series, the member, with respect to the distribution, has the
987	987	same status as a creditor of the series and is entitled to any
988	988	remedy available to a creditor of the series.
989	989	(b) Section 101.207 does not apply to a distribution with
990	990	respect to the series.
991	991	Sec. 101.612. RECORD DATE FOR ALLOCATIONS AND
992	992	DISTRIBUTIONS. A company agreement may establish or provide for
993	993	the establishment of a record date for allocations and
994	994	distributions with respect to a series.
995	995	Sec. 101.613. DISTRIBUTIONS. (a) A limited liability
996	996	company may make a distribution with respect to a series.
997	997	(b) A limited liability company may not make a distribution
998	998	with respect to a series to a member if, immediately after making
999	999	the distribution, the total amount of the liabilities of the
1000	1000	series, other than liabilities described by Subsection (c), exceeds
1001	1001	the fair value of the assets associated with the series.
1002	1002	(c) For purposes of Subsection (b), the liabilities of a
1003	1003	series do not include:
1004	1004	(1) a liability related to the member's membership
1005	1005	interest; or
1006	1006	(2) except as provided by Subsection (e), a liability
1007	1007	of the series for which the recourse of creditors is limited to
1008	1008	specified property of the series.
1009	1009	(d) For purposes of Subsection (b), the assets associated
1010	1010	with a series include the fair value of property of the series
1011	1011	subject to a liability for which recourse of creditors is limited to
1012	1012	specified property of the series only if the fair value of that
1013	1013	property exceeds the liability.
1014	1014	(e) A member who receives a distribution from a series in
1015	1015	violation of this section is not required to return the
1016	1016	distribution to the series unless the member had knowledge of the
1017	1017	violation.
1018	1018	(f) This section may not be construed to affect the
1019	1019	obligation of a member to return a distribution to the series under
1020	1020	the company agreement or other state or federal law.
1021	1021	(g) Section 101.206 does not apply to a distribution with
1022	1022	respect to a series.
1023	1023	(h) For purposes of this section, "distribution" does not
1024	1024	include an amount constituting reasonable compensation for present
1025	1025	or past services or a reasonable payment made in the ordinary course
1026	1026	of business under a bona fide retirement plan or other benefits
1027	1027	program.
1028	1028	Sec. 101.614. AUTHORITY TO WIND UP AND TERMINATE SERIES.
1029	1029	Except to the extent otherwise provided in the company agreement
1030	1030	and subject to Sections 101.617, 101.618, 101.619, and 101.620, a
1031	1031	series and its business and affairs may be wound up and terminated
1032	1032	without causing the winding up of the limited liability company.
1033	1033	Sec. 101.615. TERMINATION OF SERIES. (a) Except as
1034	1034	otherwise provided by Sections 101.617, 101.618, 101.619, and
1035	1035	101.620, the series terminates on the completion of the winding up
1036	1036	of the business and affairs of the series in accordance with
1037	1037	Sections 101.617, 101.618, 101.619, and 101.620.
1038	1038	(b) The limited liability company shall provide notice of
1039	1039	the termination of a series in the manner provided in the company
1040	1040	agreement for notice of termination, if any.
1041	1041	(c) The termination of the series does not affect the
1042	1042	limitation on liabilities of the series provided by Section
1043	1043	101.602.
1044	1044	Sec. 101.616. EVENT REQUIRING WINDING UP. Subject to
1045	1045	Sections 101.617, 101.618, 101.619, and 101.620, the business and
1046	1046	affairs of a series are required to be wound up:
1047	1047	(1) if the winding up of the limited liability company
1048	1048	is required under Section 101.552(a) or Chapter 11; or
1049	1049	(2) on the earlier of:
1050	1050	(A) the time specified for winding up the series
1051	1051	in the company agreement;
1052	1052	(B) the occurrence of an event specified with
1053	1053	respect to the series in the company agreement;
1054	1054	(C) the occurrence of a majority vote of all of
1055	1055	the members associated with the series approving the winding up of
1056	1056	the series or, if there is more than one class or group of members
1057	1057	associated with the series, a majority vote of the members of each
1058	1058	class or group of members associated with the series approving the
1059	1059	winding up of the series;
1060	1060	(D) if the series has no members, the occurrence
1061	1061	of a majority vote of all of the managers associated with the series
1062	1062	approving the winding up of the series or, if there is more than one
1063	1063	class or group of managers associated with the series, a majority
1064	1064	vote of the managers of each class or group of managers associated
1065	1065	with the series approving the winding up of the series; or
1066	1066	(E) a determination by a court in accordance with
1067	1067	Section 101.621.
1068	1068	Sec. 101.617. PROCEDURES FOR WINDING UP AND TERMINATION OF
1069	1069	SERIES. (a) The following provisions apply to a series and the
1070	1070	associated members and managers of the series:
1071	1071	(1) Subchapters A, G, H, and I, Chapter 11; and
1072	1072	(2) Subchapter B, Chapter 11, other than Sections
1073	1073	11.051, 11.056, 11.057, 11.058, and 11.059.
1074	1074	(b) For purposes of the application of Chapter 11 to a
1075	1075	series and as the context requires:
1076	1076	(1) a reference to "domestic entity," "filing entity,"
1077	1077	or "entity" means the "series";
1078	1078	(2) a reference to an "owner" means a "member
1079	1079	associated with the series";
1080	1080	(3) a reference to the "governing authority" or a
1081	1081	"governing person" means the "governing authority associated with
1082	1082	the series" or a "governing person associated with the series"; and
1083	1083	(4) a reference to "business," "property,"
1084	1084	"obligations," or "liabilities" means the "business associated
1085	1085	with the series," "property associated with the series,"
1086	1086	"obligations associated with the series," or "liabilities
1087	1087	associated with the series."
1088	1088	(c) After the occurrence of an event requiring winding up of
1089	1089	a series under Section 101.616, unless a revocation as provided by
1090	1090	Section 101.618 or a cancellation as provided by Section 101.619
1091	1091	occurs, the winding up of the series must be carried out by:
1092	1092	(1) the governing authority of the series or one or
1093	1093	more persons, including a governing person, designated by:
1094	1094	(A) the governing authority of the series;
1095	1095	(B) the members associated with the series; or
1096	1096	(C) the company agreement; or
1097	1097	(2) a person appointed by the court to carry out the
1098	1098	winding up of the series under Section 11.054, 11.405, 11.409, or
1099	1099	11.410.
1100	1100	(d) An action taken in accordance with this section does not
1101	1101	affect the limitation on liability of members and managers provided
1102	1102	by Section 101.606.
1103	1103	Sec. 101.618. REVOCATION OF VOLUNTARY WINDING UP. Before
1104	1104	the termination of the series takes effect, a voluntary decision to
1105	1105	wind up the series under Section 101.616(2)(C) or (D) may be revoked
1106	1106	by:
1107	1107	(1) a majority vote of all of the members associated
1108	1108	with the series approving the revocation or, if there is more than
1109	1109	one class or group of members associated with the series, a majority
1110	1110	vote of the members of each class or group of members associated
1111	1111	with the series approving the revocation; or
1112	1112	(2) if the series has no members, a majority vote of
1113	1113	all the managers associated with the series approving the
1114	1114	revocation or, if there is more than one class or group of managers
1115	1115	associated with the series, a majority vote of the managers of each
1116	1116	class or group of managers associated with the series approving the
1117	1117	revocation.
1118	1118	Sec. 101.619. CANCELLATION OF EVENT REQUIRING WINDING UP.
1119	1119	(a) Unless the cancellation is prohibited by the company
1120	1120	agreement, an event requiring winding up of the series under
1121	1121	Section 101.616(1) or (2) may be canceled by the consent of all of
1122	1122	the members of the series before the termination of the series takes
1123	1123	effect.
1124	1124	(b) In connection with the cancellation, the members must
1125	1125	amend the company agreement to:
1126	1126	(1) eliminate or extend the time specified for the
1127	1127	series if the event requiring winding up of the series occurred
1128	1128	under Section 101.616(1); or
1129	1129	(2) eliminate or revise the event specified with
1130	1130	respect to the series if the event requiring winding up of the
1131	1131	series occurred under Section 101.616(2).
1132	1132	Sec. 101.620. CONTINUATION OF BUSINESS. The series may
1133	1133	continue its business following the revocation under Section
1134	1134	101.618 or the cancellation under Section 101.619.
1135	1135	Sec. 101.621. WINDING UP BY COURT ORDER. A district court
1136	1136	in the county in which the registered office or principal place of
1137	1137	business in this state of a domestic limited liability company is
1138	1138	located, on application by or for a member associated with the
1139	1139	series, has jurisdiction to order the winding up and termination of
1140	1140	a series if the court determines that it is not reasonably
1141	1141	practicable to carry on the business of the series in conformity
1142	1142	with the company agreement.
1143	1143	SECTION 46. Chapter 151, Business Organizations Code, is
1144	1144	amended by adding Section 151.004 to read as follows:
1145	1145	Sec. 151.004. OFFICERS. A partnership may have elected or
1146	1146	appointed officers in accordance with Section 3.103.
1147	1147	SECTION 47. Section 152.801(a), Business Organizations
1148	1148	Code, is amended to read as follows:
1149	1149	(a) Except as provided by Subsection (b) or the partnership
1150	1150	agreement, a partner in a limited liability partnership is not
1151	1151	personally liable to any person, including a partner, directly or
1152	1152	indirectly, by contribution, indemnity, or otherwise, for a debt or
1153	1153	obligation of the partnership incurred while the partnership is a
1154	1154	limited liability partnership.
1155	1155	SECTION 48. Section 152.802(f), Business Organizations
1156	1156	Code, is amended to read as follows:
1157	1157	(f) A registration may be withdrawn by filing a withdrawal
1158	1158	notice with the secretary of state in accordance with Chapter 4. A
1159	1159	certificate from the comptroller stating that all taxes
1160	1160	administered by the comptroller under Title 2, Tax Code, have been
1161	1161	paid must be filed with the notice of withdrawal. A withdrawal
1162	1162	notice terminates the status of the partnership as a limited
1163	1163	liability partnership from the date on which the notice is filed or
1164	1164	a later date specified in the notice, but not later than the
1165	1165	expiration date under Subsection (e). A withdrawal notice must:
1166	1166	(1) contain:
1167	1167	(A) the name of the partnership;
1168	1168	(B) the federal tax identification number of the
1169	1169	partnership;
1170	1170	(C) the date of registration of the partnership's
1171	1171	last application under this subchapter; and
1172	1172	(D) the current street address of the
1173	1173	partnership's principal office in this state and outside this
1174	1174	state, if applicable; and
1175	1175	(2) be signed by:
1176	1176	(A) a majority-in-interest of the partners; or
1177	1177	(B) one or more partners authorized by a
1178	1178	majority-in-interest of the partners.
1179	1179	SECTION 49. Section 152.906, Business Organizations Code,
1180	1180	is amended by adding Subsection (c) to read as follows:
1181	1181	(c) A certificate from the comptroller stating that all
1182	1182	taxes administered by the comptroller under Title 2, Tax Code, have
1183	1183	been paid must be filed with the withdrawal of registration.
1184	1184	SECTION 50. Section 152.914, Business Organizations Code,
1185	1185	is amended by adding Subsection (f) to read as follows:
1186	1186	(f) A tax clearance letter from the comptroller stating that
1187	1187	a foreign limited liability partnership has satisfied all franchise
1188	1188	tax liabilities and may be reinstated must be filed with the
1189	1189	certificate of reinstatement if the foreign limited liability
1190	1190	partnership is a taxable entity under Chapter 171, Tax Code.
1191	1191	SECTION 51. Section 153.103, Business Organizations Code,
1192	1192	is amended to read as follows:
1193	1193	Sec. 153.103. ACTIONS NOT CONSTITUTING PARTICIPATION IN
1194	1194	BUSINESS FOR LIABILITY PURPOSES. For purposes of this section and
1195	1195	Sections 153.102, 153.104, and 153.105, a limited partner does not
1196	1196	participate in the control of the business because the limited
1197	1197	partner has or has acted in one or more of the following capacities
1198	1198	or possesses or exercises one or more of the following powers:
1199	1199	(1) acting as:
1200	1200	(A) a contractor for or an officer or other agent
1201	1201	or employee of the limited partnership;
1202	1202	(B) a contractor for or an agent or employee of a
1203	1203	general partner;
1204	1204	(C) an officer, director, or stockholder of a
1205	1205	corporate general partner;
1206	1206	(D) a partner of a partnership that is a general
1207	1207	partner of the limited partnership; or
1208	1208	(E) a member or manager of a limited liability
1209	1209	company that is a general partner of the limited partnership;
1210	1210	(2) acting in a capacity similar to that described in
1211	1211	Subdivision (1) with any other person that is a general partner of
1212	1212	the limited partnership;
1213	1213	(3) consulting with or advising a general partner on
1214	1214	any matter, including the business of the limited partnership;
1215	1215	(4) acting as surety, guarantor, or endorser for the
1216	1216	limited partnership, guaranteeing or assuming one or more specific
1217	1217	obligations of the limited partnership, or providing collateral for
1218	1218	borrowings of the limited partnership;
1219	1219	(5) calling, requesting, attending, or participating
1220	1220	in a meeting of the partners or the limited partners;
1221	1221	(6) winding up the business of a limited partnership
1222	1222	under Chapter 11 and Subchapter K of this chapter;
1223	1223	(7) taking an action required or permitted by law to
1224	1224	bring, pursue, settle, or otherwise terminate a derivative action
1225	1225	in the right of the limited partnership;
1226	1226	(8) serving on a committee of the limited partnership
1227	1227	or the limited partners; or
1228	1228	(9) proposing, approving, or disapproving, by vote or
1229	1229	otherwise, one or more of the following matters:
1230	1230	(A) the winding up or termination of the limited
1231	1231	partnership;
1232	1232	(B) an election to reconstitute the limited
1233	1233	partnership or continue the business of the limited partnership;
1234	1234	(C) the sale, exchange, lease, mortgage,
1235	1235	assignment, pledge, or other transfer of, or granting of a security
1236	1236	interest in, an asset of the limited partnership;
1237	1237	(D) the incurring, renewal, refinancing, or
1238	1238	payment or other discharge of indebtedness by the limited
1239	1239	partnership;
1240	1240	(E) a change in the nature of the business of the
1241	1241	limited partnership;
1242	1242	(F) the admission, removal, or retention of a
1243	1243	general partner;
1244	1244	(G) the admission, removal, or retention of a
1245	1245	limited partner;
1246	1246	(H) a transaction or other matter involving an
1247	1247	actual or potential conflict of interest;
1248	1248	(I) an amendment to the partnership agreement or
1249	1249	certificate of formation;
1250	1250	(J) if the limited partnership is qualified as an
1251	1251	investment company under the federal Investment Company Act of 1940
1252	1252	(15 U.S.C. Section 80a-1 et seq.), as amended, any matter required
1253	1253	by that Act or the rules and regulations of the Securities and
1254	1254	Exchange Commission under that Act, to be approved by the holders of
1255	1255	beneficial interests in an investment company, including:
1256	1256	(i) electing directors or trustees of the
1257	1257	investment company;
1258	1258	(ii) approving or terminating an investment
1259	1259	advisory or underwriting contract;
1260	1260	(iii) approving an auditor; and
1261	1261	(iv) acting on another matter that that Act
1262	1262	requires to be approved by the holders of beneficial interests in
1263	1263	the investment company;
1264	1264	(K) indemnification of a general partner under
1265	1265	Chapter 8 or otherwise;
1266	1266	(L) any other matter stated in the partnership
1267	1267	agreement;
1268	1268	(M) the exercising of a right or power granted or
1269	1269	permitted to limited partners under this code and not specifically
1270	1270	enumerated in this section; or
1271	1271	(N) the merger or conversion of a limited
1272	1272	partnership.
1273	1273	SECTION 52. Section 153.210, Business Organizations Code,
1274	1274	is amended to read as follows:
1275	1275	Sec. 153.210. LIMITATION ON DISTRIBUTION. (a) Unless the
1276	1276	distribution is made in compliance with Chapter 11, a [A] limited
1277	1277	partnership may not make a distribution to a partner if,
1278	1278	immediately after giving effect to the distribution and despite any
1279	1279	compromise of a claim referred to by Sections 153.203 and 153.204,
1280	1280	all liabilities of the limited partnership, other than liabilities
1281	1281	to partners with respect to their partnership interests and
1282	1282	liabilities for which the recourse of creditors is limited to
1283	1283	specified property of the limited partnership, exceed the fair
1284	1284	value of the partnership assets. The fair value of property that is
1285	1285	subject to a liability for which recourse of creditors is limited
1286	1286	shall be included in the partnership assets for purposes of this
1287	1287	subsection only to the extent that the fair value of that property
1288	1288	exceeds that liability.
1289	1289	(b) For purposes of this section, "distribution" does not
1290	1290	include an amount constituting reasonable compensation for present
1291	1291	or past services or a reasonable payment made in the ordinary course
1292	1292	of business under a bona fide retirement plan or other benefits
1293	1293	program.
1294	1294	SECTION 53. Section 153.256(c), Business Organizations
1295	1295	Code, is amended to read as follows:
1296	1296	(c) A charging order constitutes a lien on the judgment
1297	1297	debtor's partnership interest. The charging order lien may not be
1298	1298	foreclosed on under this code or any other law.
1299	1299	SECTION 54. Section 153.309(c), Business Organizations
1300	1300	Code, is amended to read as follows:
1301	1301	(c) This section and Sections 153.307 and 153.308 do not
1302	1302	affect the liability of a limited partner [to the limited
1303	1303	partnership].
1304	1304	SECTION 55. Section 153.311, Business Organizations Code,
1305	1305	is amended to read as follows:
1306	1306	Sec. 153.311. TERMINATION [CANCELLATION] OF CERTIFICATE OR
1307	1307	REVOCATION OF REGISTRATION AFTER FORFEITURE. (a) The secretary of
1308	1308	state may terminate [cancel] the certificate of formation of a
1309	1309	domestic limited partnership, or revoke the registration of a
1310	1310	foreign limited partnership, if the limited partnership:
1311	1311	(1) forfeits its right to transact business in this
1312	1312	state under Section 153.307; and
1313	1313	(2) fails to revive that right under Section 153.310.
1314	1314	(b) Termination [Cancellation] of the certificate or
1315	1315	revocation of registration takes effect without judicial
1316	1316	ascertainment.
1317	1317	(c) The secretary of state shall note the termination or
1318	1318	revocation [cancellation] and the date [of cancellation] on the
1319	1319	record kept in the secretary's office relating to the limited
1320	1320	partnership.
1321	1321	(d) On termination or revocation [cancellation], the status
1322	1322	of the limited partnership is changed to inactive according to the
1323	1323	records of the secretary of state. The change to inactive status
1324	1324	does not affect the liability of a limited partner [to the limited
1325	1325	partnership].
1326	1326	SECTION 56. Sections 153.312(a) and (b), Business
1327	1327	Organizations Code, are amended to read as follows:
1328	1328	(a) A limited partnership the certificate of formation or
1329	1329	registration of which has been terminated or revoked [canceled] as
1330	1330	provided by Section 153.311 may be relieved of the termination or
1331	1331	revocation [cancellation] by filing the report required by Section
1332	1332	153.301, accompanied by the filing fees provided by Chapter 4.
1333	1333	(b) If the limited partnership pays the fees required by
1334	1334	Subsection (a) and all taxes, penalties, and interest due and
1335	1335	accruing before termination or revocation, the secretary of state
1336	1336	shall:
1337	1337	(1) reinstate the certificate or registration of the
1338	1338	limited partnership without judicial ascertainment;
1339	1339	(2) change the status of the limited partnership to
1340	1340	active; and
1341	1341	(3) note the reinstatement on the record kept in the
1342	1342	secretary's office relating to the limited partnership.
1343	1343	SECTION 57. Section 154.001, Business Organizations Code,
1344	1344	is amended by adding Subsection (d) to read as follows:
1345	1345	(d) Sections 9.406 and 9.408, Business & Commerce Code, do
1346	1346	not apply to a partnership interest in a partnership, including the
1347	1347	rights, powers, and interests arising under the governing documents
1348	1348	of the partnership or under this code. To the extent of any
1349	1349	conflict between this subsection and Section 9.406 or 9.408,
1350	1350	Business & Commerce Code, this subsection controls. It is the
1351	1351	express intent of this subsection to permit the enforcement, as a
1352	1352	contract among the partners of a partnership, of any provision of a
1353	1353	partnership agreement that would otherwise be ineffective under
1354	1354	Section 9.406 or 9.408, Business & Commerce Code.
1355	1355	SECTION 58. Section 200.317(b), Business Organizations
1356	1356	Code, is amended to read as follows:
1357	1357	(b) An otherwise valid contract or transaction described by
1358	1358	Subsection (a) is valid notwithstanding that the [a] trust manager
1359	1359	or officer having the relationship or interest described by
1360	1360	Subsection (a) [of the trust] is present at or participates in the
1361	1361	meeting of the trust managers or of a committee of the trust
1362	1362	managers that authorizes the contract or transaction, or votes or
1363	1363	signs, in the person's capacity as a trust manager or committee
1364	1364	member, a unanimous written consent of trust managers or committee
1365	1365	members to authorize the contract or transaction, if:
1366	1366	(1) the material facts as to the relationship or
1367	1367	interest described by Subsection (a) and as to the contract or
1368	1368	transaction are disclosed to or known by:
1369	1369	(A) the trust managers or a committee of the
1370	1370	trust managers, and the trust managers or committee of the trust
1371	1371	managers in good faith authorize the contract or transaction by the
1372	1372	approval [affirmative vote] of the majority of disinterested trust
1373	1373	managers or committee members, regardless of whether the
1374	1374	disinterested trust managers or committee members constitute a
1375	1375	quorum; or
1376	1376	(B) the shareholders entitled to vote on the
1377	1377	authorization of the contract or transaction, and the contract or
1378	1378	transaction is specifically approved in good faith by a vote of the
1379	1379	shareholders; or
1380	1380	(2) the contract or transaction is fair to the real
1381	1381	estate investment trust when the contract or transaction is
1382	1382	authorized, approved, or ratified by the trust managers, a
1383	1383	committee of the trust managers, or the shareholders.
1384	1384	SECTION 59. Section 402.005(a), Business Organizations
1385	1385	Code, is amended to read as follows:
1386	1386	(a) On or after January 1, 2010, if a domestic entity formed
1387	1387	before January 1, 2006, or a foreign filing entity registered with
1388	1388	the secretary of state to transact business in this state before
1389	1389	January 1, 2006, has not taken the actions specified by Section
1390	1390	402.003 [402.003(a)] or 402.004 to elect to adopt this code:
1391	1391	(1) this code applies to the entity and all actions
1392	1392	taken by the managerial officials, owners, or members of the
1393	1393	entity, except as otherwise expressly provided by this title;
1394	1394	(2) if the entity is a domestic or foreign filing
1395	1395	entity, the entity is not considered to have failed to comply with
1396	1396	this code if the entity's certificate of formation or application
1397	1397	for registration, as appropriate, does not comply with this code;
1398	1398	(3) if the entity is a domestic filing entity, the
1399	1399	entity shall conform its certificate of formation to the
1400	1400	requirements of this code when it next files an amendment to its
1401	1401	certificate of formation; and
1402	1402	(4) if the entity is a foreign filing entity, the
1403	1403	entity shall conform its application for registration to the
1404	1404	requirements of this code when it next files an amendment to its
1405	1405	application for registration.
1406	1406	SECTION 60. Section 9.406, Business & Commerce Code, is
1407	1407	amended by adding Subsection (j) to read as follows:
1408	1408	(j) This section does not apply to an interest in a
1409	1409	partnership or limited liability company.
1410	1410	SECTION 61. Section 9.408, Business & Commerce Code, is
1411	1411	amended by adding Subsection (e) to read as follows:
1412	1412	(e) This section does not apply to an interest in a
1413	1413	partnership or limited liability company.
1414	1414	SECTION 62. Section 71.002, Business & Commerce Code, is
1415	1415	amended by amending Subdivisions (2), (4), (7), (8), and (9) and
1416	1416	adding Subdivision (6-a) to read as follows:
1417	1417	(2) "Assumed name" means:
1418	1418	(A) for an individual, a name that does not
1419	1419	include the surname of the individual;
1420	1420	(B) for a partnership, a name that does not
1421	1421	include the surname or other legal name of each joint venturer or
1422	1422	general partner;
1423	1423	(C) for an individual or a partnership, a name,
1424	1424	including a surname, that suggests the existence of additional
1425	1425	owners by including words such as "Company," "& Company," "& Son,"
1426	1426	"& Sons," "& Associates," "Brothers," and similar words, but not
1427	1427	words that merely describe the business being conducted or the
1428	1428	professional service being rendered;
1429	1429	(D) for a limited partnership, a name other than
1430	1430	the name stated in its certificate of formation;
1431	1431	(E) for a company, a name used by the company;
1432	1432	(F) for a corporation, a name other than the name
1433	1433	stated in its certificate of formation or a comparable document;
1434	1434	(G) for a [registered] limited liability
1435	1435	partnership, a name other than the name stated in its application
1436	1436	filed with the office of the secretary of state or a comparable
1437	1437	document; and
1438	1438	(H) for a limited liability company, a name other
1439	1439	than the name stated in its certificate of formation or a comparable
1440	1440	document.
1441	1441	(4) "Company" means a real estate investment trust, a
1442	1442	joint-stock company, or any other business, professional, or other
1443	1443	association or legal entity that is not incorporated, other than a
1444	1444	partnership, limited partnership, limited liability company, [or
1445	1445	registered] limited liability partnership, or foreign filing
1446	1446	entity.
1447	1447	(6-a) "Foreign filing entity" means an entity formed
1448	1448	under the laws of a jurisdiction other than this state that
1449	1449	registers or is required by law to register with the secretary of
1450	1450	state to conduct business or render professional services in this
1451	1451	state under Chapter 9, Business Organizations Code.
1452	1452	(7) "Office" means:
1453	1453	(A) for a person that is not an individual or that
1454	1454	is a corporation that is not required to or does not maintain a
1455	1455	registered office in this state, the person's:
1456	1456	(i) principal office; and
1457	1457	(ii) principal place of business if not the
1458	1458	same as the person's principal office; and
1459	1459	(B) for a corporation, limited partnership,
1460	1460	[registered] limited liability partnership, [or] limited liability
1461	1461	company, or foreign filing entity that is required to maintain a
1462	1462	registered office in this state, the entity's:
1463	1463	(i) registered office; and
1464	1464	(ii) principal office if not the same as the
1465	1465	entity's registered office.
1466	1466	(8) "Partnership" means a joint venture or general
1467	1467	partnership other than a limited partnership or a [registered]
1468	1468	limited liability partnership.
1469	1469	(9) "Person" includes an individual, partnership,
1470	1470	limited partnership, limited liability company, [registered]
1471	1471	limited liability partnership, company, [or] corporation, or
1472	1472	foreign filing entity.
1473	1473	SECTION 63. Section 71.003(b), Business & Commerce Code, is
1474	1474	amended to read as follows:
1475	1475	(b) This chapter does not require a corporation, limited
1476	1476	partnership, [registered] limited liability partnership, [or]
1477	1477	limited liability company, or foreign filing entity or its
1478	1478	shareholders, associates, partners, or members to file a
1479	1479	certificate to conduct business or render a professional service in
1480	1480	this state under the name of the entity as stated in the certificate
1481	1481	of formation, application filed with the office of the secretary of
1482	1482	state, or other comparable document of the entity.
1483	1483	SECTION 64. Section 71.051, Business & Commerce Code, is
1484	1484	amended to read as follows:
1485	1485	Sec. 71.051. CERTIFICATE FOR CERTAIN UNINCORPORATED
1486	1486	PERSONS. A person must file a certificate under this subchapter if
1487	1487	the person regularly conducts business or renders a professional
1488	1488	service in this state under an assumed name other than as a
1489	1489	corporation, limited partnership, [registered] limited liability
1490	1490	partnership, [or] limited liability company, or foreign filing
1491	1491	entity.
1492	1492	SECTION 65. Section 71.052, Business & Commerce Code, is
1493	1493	amended to read as follows:
1494	1494	Sec. 71.052. CONTENTS OF CERTIFICATE. The certificate must
1495	1495	state:
1496	1496	(1) the assumed name under which the business is or is
1497	1497	to be conducted or the professional service is or is to be rendered;
1498	1498	(2) if the registrant is:
1499	1499	(A) an individual, the individual's full name and
1500	1500	residence address;
1501	1501	(B) a partnership:
1502	1502	(i) the venture or partnership name;
1503	1503	(ii) the venture or partnership office
1504	1504	address;
1505	1505	(iii) the full name of each joint venturer
1506	1506	or general partner; and
1507	1507	(iv) each joint venturer's or general
1508	1508	partner's residence address if the venturer or partner is an
1509	1509	individual or the joint venturer's or general partner's office
1510	1510	address if the venturer or partner is not an individual;
1511	1511	(C) an estate:
1512	1512	(i) the name of the estate;
1513	1513	(ii) the estate's office address, if any;
1514	1514	(iii) the full name of each representative
1515	1515	of the estate; and
1516	1516	(iv) each representative's residence
1517	1517	address if the representative is an individual or the
1518	1518	representative's office address if the representative is not an
1519	1519	individual;
1520	1520	(D) a real estate investment trust:
1521	1521	(i) the name of the trust;
1522	1522	(ii) the address of the trust;
1523	1523	(iii) the full name of each trustee
1524	1524	manager; and
1525	1525	(iv) each trustee manager's residence
1526	1526	address if the trustee manager is an individual or the trustee
1527	1527	manager's office address if the trustee manager is not an
1528	1528	individual; or
1529	1529	(E) a company, other than a real estate
1530	1530	investment trust[, or a corporation]:
1531	1531	(i) the name of the company [or
1532	1532	corporation];
1533	1533	(ii) the state, country, or other
1534	1534	jurisdiction under the laws of which the company [or corporation]
1535	1535	was organized [or incorporated]; and
1536	1536	(iii) the company's [or corporation's]
1537	1537	office address;
1538	1538	(3) the period, not to exceed 10 years, during which
1539	1539	the registrant will use the assumed name; and
1540	1540	(4) a statement specifying that the business that is
1541	1541	or will be conducted or the professional service that is or will be
1542	1542	rendered in the county under the assumed name is being or will be
1543	1543	conducted or rendered as a proprietorship, sole practitioner,
1544	1544	partnership, real estate investment trust, joint-stock company, or
1545	1545	other form of unincorporated business or professional association
1546	1546	or entity other than a limited partnership, limited liability
1547	1547	company, [or registered] limited liability partnership, or foreign
1548	1548	filing entity.
1549	1549	SECTION 66. Section 71.101, Business & Commerce Code, is
1550	1550	amended to read as follows:
1551	1551	Sec. 71.101. CERTIFICATE FOR INCORPORATED BUSINESS OR
1552	1552	PROFESSION, LIMITED PARTNERSHIP, [REGISTERED] LIMITED LIABILITY
1553	1553	PARTNERSHIP, [OR] LIMITED LIABILITY COMPANY, OR FOREIGN FILING
1554	1554	ENTITY. A corporation, limited partnership, [registered] limited
1555	1555	liability partnership, [or] limited liability company, or foreign
1556	1556	filing entity must file a certificate under this subchapter if the
1557	1557	entity:
1558	1558	(1) regularly conducts business or renders
1559	1559	professional services in this state under an assumed name; or
1560	1560	(2) is required by law to use an assumed name in this
1561	1561	state to conduct business or render professional services.
1562	1562	SECTION 67. Section 71.102, Business & Commerce Code, is
1563	1563	amended to read as follows:
1564	1564	Sec. 71.102. CONTENTS OF CERTIFICATE. The certificate must
1565	1565	state:
1566	1566	(1) the assumed name under which the business is or is
1567	1567	to be conducted or the professional service is or is to be rendered;
1568	1568	(2) the registrant's name as stated in the
1569	1569	registrant's certificate of formation or application filed with the
1570	1570	office of the secretary of state or other comparable document;
1571	1571	(3) the state, country, or other jurisdiction under
1572	1572	the laws of which the registrant was incorporated or organized and
1573	1573	the registrant's registered or similar office address in that
1574	1574	state, country, or jurisdiction;
1575	1575	(4) the period, not to exceed 10 years, during which
1576	1576	the registrant will use the assumed name;
1577	1577	(5) a statement specifying that the registrant is:
1578	1578	(A) a for-profit [business] corporation,
1579	1579	nonprofit corporation, professional corporation, professional
1580	1580	association, or other type of corporation;
1581	1581	(B) a limited partnership, [registered] limited
1582	1582	liability partnership, or limited liability company; or
1583	1583	(C) another type of incorporated business,
1584	1584	professional or other association, or legal entity, foreign or
1585	1585	domestic;
1586	1586	(6) the address of:
1587	1587	(A) the registrant's[:
1588	1588	[(i) registered office in this state and
1589	1589	the name of its registered agent at that address; and
1590	1590	[(ii)] principal office[, if the principal
1591	1591	office address is not the same as the registrant's registered
1592	1592	office address in this state]; or
1593	1593	(B) if the registrant is not required to or does
1594	1594	not maintain a registered office in this state:
1595	1595	(i) the registrant's office in this state;
1596	1596	and
1597	1597	(ii) the registrant's place of business in
1598	1598	this state and any office of the registrant outside this state, if
1599	1599	the registrant is not incorporated or organized under the laws of
1600	1600	this state; and
1601	1601	(7) the county or counties in this state where the
1602	1602	registrant is or will be conducting business or rendering
1603	1603	professional services under the assumed name.
1604	1604	SECTION 68. Section 71.103, Business & Commerce Code, is
1605	1605	amended to read as follows:
1606	1606	Sec. 71.103. PLACE OF FILING. (a) The corporation, limited
1607	1607	partnership, [registered] limited liability partnership, [or]
1608	1608	limited liability company, or foreign filing entity shall file the
1609	1609	certificate in the office of the secretary of state and in the
1610	1610	office or offices of each county clerk as specified by Subsection
1611	1611	(b) or (c).
1612	1612	(b) An [Except as provided by Subsection (c), the] entity
1613	1613	that maintains a registered office in this state shall file the
1614	1614	certificate in the office [offices] of the county clerk of the
1615	1615	county in which the entity's:
1616	1616	(1) registered office is located, if the entity's
1617	1617	principal office is not located in this state; or [and]
1618	1618	(2) principal office is located, if the entity's
1619	1619	principal office is located in this state [and not in the same
1620	1620	county where the registered office is located].
1621	1621	(c) An [If the] entity that [is not required to or] does not
1622	1622	maintain a registered office in this state[, the entity] shall file
1623	1623	the certificate:
1624	1624	(1) in the office of the county clerk of the county in
1625	1625	which the entity's office in this state is located; or
1626	1626	(2) in the office of the county clerk of the county in
1627	1627	which the entity's principal place of business in this state is
1628	1628	located, if:
1629	1629	(A) the entity is not incorporated or organized
1630	1630	under the laws of this state; and
1631	1631	(B) the county in which the entity's principal
1632	1632	place of business in this state is located is not the same county
1633	1633	where the entity's office is located.
1634	1634	SECTION 69. Section 71.152(b), Business & Commerce Code, is
1635	1635	amended to read as follows:
1636	1636	(b) An event that causes the information in a certificate to
1637	1637	become materially misleading includes:
1638	1638	(1) a change in the name, identity, entity, form of
1639	1639	business or professional organization, or location of a registrant;
1640	1640	(2) for a proprietorship or sole practitioner, a
1641	1641	change in ownership; or
1642	1642	(3) for a partnership:
1643	1643	(A) the admission of a new partner or joint
1644	1644	venturer; or
1645	1645	(B) the end of a general partner's or joint
1646	1646	venturer's association with the partnership[; or
1647	1647	[(4) for a registrant required by law to maintain a
1648	1648	registered office or similar office and a registered agent or
1649	1649	similar agent at that office, a change in the address of the office
1650	1650	or in the identity of the agent].
1651	1651	SECTION 70. Section 19(A), Texas Professional Association
1652	1652	Act (Article 1528f, Vernon's Texas Civil Statutes), is amended to
1653	1653	read as follows:
1654	1654	(A) The original and a copy of the articles of dissolution
1655	1655	shall be delivered to the Secretary of State, together with a
1656	1656	certificate from the comptroller stating that all taxes
1657	1657	administered by the comptroller under Title 2, Tax Code, have been
1658	1658	paid. If the Secretary of State finds that the articles of
1659	1659	dissolution conform to law, he shall, when all fees have been paid
1660	1660	as required by law:
1661	1661	(1) Endorse on the original and the copy the word
1662	1662	"Filed," and the month, day, and year of the filing thereof.
1663	1663	(2) File the original in his office.
1664	1664	(3) Issue a certificate of dissolution to which he
1665	1665	shall affix the copy.
1666	1666	SECTION 71. Section 2.03(a), Texas Revised Limited
1667	1667	Partnership Act (Article 6132a-1, Vernon's Texas Civil Statutes),
1668	1668	is amended to read as follows:
1669	1669	(a) A certificate of limited partnership shall be canceled
1670	1670	by paying the filing fee and filing a certificate of cancellation,
1671	1671	together with a certificate from the comptroller stating that all
1672	1672	taxes administered by the comptroller under Title 2, Tax Code, have
1673	1673	been paid, with the secretary of state:
1674	1674	(1) on the completion of the winding up of the
1675	1675	partnership;
1676	1676	(2) when there are no limited partners; or
1677	1677	(3) subject to Subsection (c) of this section, on a
1678	1678	merger or conversion as provided by Subsection (b) of Section 2.11
1679	1679	of this Act or Subsection (c) of Section 2.15 of this Act.
1680	1680	SECTION 72. Section 9.06, Texas Revised Limited Partnership
1681	1681	Act (Article 6132a-1, Vernon's Texas Civil Statutes), is amended to
1682	1682	read as follows:
1683	1683	Sec. 9.06. CANCELLATION OF REGISTRATION. A foreign limited
1684	1684	partnership may cancel its registration by paying the application
1685	1685	fee and filing with the secretary of state a certificate of
1686	1686	cancellation executed by a general partner, conforming to the
1687	1687	requirements of Section 2.03 of this Act as if it were a domestic
1688	1688	limited partnership, together with a certificate from the
1689	1689	comptroller stating that all taxes administered by the comptroller
1690	1690	under Title 2, Tax Code, have been paid. A cancellation does not
1691	1691	terminate the authority of the secretary of state to accept service
1692	1692	of process on the foreign limited partnership with respect to
1693	1693	causes of action arising out of the transaction of business in
1694	1694	Texas.
1695	1695	SECTION 73. Section 2.006, Business Organizations Code, is
1696	1696	repealed.
1697	1697	SECTION 74. This Act takes effect September 1, 2009.