Texas 2009 - 81st Regular

Texas Senate Bill SB1442 Compare Versions

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1	1	S.B. No. 1442
2	2
3	3
4	4	AN ACT
5	5	relating to business entities and associations.
6	6	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
7	7	SECTION 1. Section 1.002, Business Organizations Code, is
8	8	amended by amending Subdivisions (10), (11), (12), and (81) and
9	9	adding Subdivisions (56-a) and (56-b) to read as follows:
10	10	(10) "Conversion" means:
11	11	(A) the continuance of a domestic entity as a
12	12	non-code organization [foreign entity] of any type;
13	13	(B) the continuance of a non-code organization
14	14	[foreign entity] as a domestic entity of any type; [or]
15	15	(C) the continuance of a domestic entity of one
16	16	type as a domestic entity of another type;
17	17	(D) the continuance of a domestic entity of one
18	18	type as a foreign entity of the same type that may be treated as a
19	19	domestication, continuance, or transfer transaction under the laws
20	20	of the jurisdiction of formation of the foreign entity; or
21	21	(E) the continuance of a foreign entity of one
22	22	type as a domestic entity of the same type that may be treated as a
23	23	domestication, continuance, or transfer transaction under the laws
24	24	of the jurisdiction of formation of the foreign entity.
25	25	(11) "Converted entity" means an organization
26	26	[entity] resulting from a conversion.
27	27	(12) "Converting entity" means an organization
28	28	[entity] as the organization [entity] existed before the
29	29	organization's [entity's] conversion.
30	30	(56-a) "Non-United States entity" means a foreign
31	31	entity formed under, and the internal affairs of which are governed
32	32	by, the laws of a non-United States jurisdiction.
33	33	(56-b) "Non-United States jurisdiction" means a
34	34	foreign country or other foreign jurisdiction that is not the
35	35	United States or a state of the United States.
36	36	(81) "Shareholder" or "holder of shares" means:
37	37	(A) the person in whose name shares issued by a
38	38	for-profit corporation, professional corporation, or real estate
39	39	investment trust are registered in the share transfer records
40	40	maintained by the for-profit corporation, professional
41	41	corporation, or real estate investment trust; or
42	42	(B) the beneficial owner of shares issued by a
43	43	for-profit corporation, whose shares are held in a voting trust or
44	44	by a nominee on the beneficial owner's behalf, to the extent of the
45	45	rights granted by a nominee statement on file with the for-profit
46	46	corporation in accordance with Sections 21.201(b) and (c).
47	47	SECTION 2. Section 2.003, Business Organizations Code, is
48	48	amended to read as follows:
49	49	Sec. 2.003. GENERAL PROHIBITED PURPOSES. A domestic entity
50	50	may not:
51	51	(1) engage in a business or activity that:
52	52	(A) is expressly unlawful or prohibited by a law
53	53	of this state; or
54	54	(B) cannot lawfully be engaged in by that entity
55	55	under state law; or
56	56	(2) operate as a:
57	57	(A) bank;
58	58	(B) trust company;
59	59	(C) savings association;
60	60	(D) insurance company;
61	61	(E) [railroad company;
62	62	[(F)] cemetery organization, except as
63	63	authorized by Chapter 711, 712, or 715, Health and Safety Code; or
64	64	(F) [(G)] abstract or title company governed by
65	65	Title 11, Insurance Code.
66	66	SECTION 3. Section 3.202, Business Organizations Code, is
67	67	amended by adding Subsection (f) to read as follows:
68	68	(f) A certificate representing ownership interests may not
69	69	be issued in bearer form.
70	70	SECTION 4. Chapter 3, Business Organizations Code, is
71	71	amended by adding Subchapter F to read as follows:
72	72	SUBCHAPTER F. EMERGENCY GOVERNANCE
73	73	Sec. 3.251. EMERGENCY DEFINED. For purposes of this
74	74	subchapter, an emergency exists if a majority of a domestic
75	75	entity's governing persons cannot readily participate in a meeting
76	76	because of the occurrence of a catastrophic event.
77	77	Sec. 3.252. PROVISIONS IN GOVERNING DOCUMENTS. (a) Except
78	78	as otherwise provided by the entity's governing documents, the
79	79	governing persons, owners, or members of a domestic entity may
80	80	adopt provisions in the entity's governing documents regarding the
81	81	management of the entity during an emergency, including provisions:
82	82	(1) prescribing procedures for calling a meeting of
83	83	the governing persons;
84	84	(2) establishing minimum requirements for
85	85	participation at the meeting of the governing persons; and
86	86	(3) designating additional or substitute governing
87	87	persons.
88	88	(b) The emergency provisions must be adopted in accordance
89	89	with:
90	90	(1) the requirements of the governing documents; and
91	91	(2) the applicable provisions of this code.
92	92	Sec. 3.253. EFFECT OF EMERGENCY PROVISIONS. The emergency
93	93	provisions adopted under Section 3.252 take effect only in the
94	94	event of an emergency. The emergency provisions will no longer be
95	95	effective after the emergency ends.
96	96	Sec. 3.254. EFFECT OF OTHER PROVISIONS IN GOVERNING
97	97	DOCUMENTS DURING EMERGENCY. A provision of an entity's governing
98	98	documents that is consistent with the emergency provisions adopted
99	99	under Section 3.252 remains in effect during an emergency.
100	100	Sec. 3.255. EFFECT OF ACTION TAKEN. An action of a domestic
101	101	entity taken in good faith in accordance with the emergency
102	102	provisions:
103	103	(1) is binding on the entity; and
104	104	(2) may not be used to impose liability on a managerial
105	105	official, employee, or agent of the entity.
106	106	SECTION 5. Section 4.005, Business Organizations Code, is
107	107	amended by adding Subsections (d) and (e) to read as follows:
108	108	(d) Subject to any qualification stated in the certificate,
109	109	a certificate issued by the secretary of state stating that a
110	110	domestic filing entity is in existence may be relied on as
111	111	conclusive evidence of the entity's existence.
112	112	(e) Subject to any qualification stated in the certificate,
113	113	a certificate issued by the secretary of state stating that a
114	114	foreign filing entity is in existence or registered may be relied on
115	115	as conclusive evidence that the foreign filing entity is registered
116	116	and authorized to transact business in this state.
117	117	SECTION 6. Subsection (b), Section 4.101, Business
118	118	Organizations Code, is amended to read as follows:
119	119	(b) A certificate of correction must be signed by the person
120	120	authorized by this code to sign the filing instrument to be
121	121	corrected [act on behalf of the entity].
122	122	SECTION 7. Section 6.052, Business Organizations Code, is
123	123	amended by adding Subsection (d) to read as follows:
124	124	(d) The participation or attendance at a meeting of a person
125	125	entitled to notice of the meeting constitutes a waiver by the person
126	126	of notice of a particular matter at the meeting that is not included
127	127	in the purposes or business of the meeting described in the notice
128	128	unless the person objects to considering the matter when it is
129	129	presented.
130	130	SECTION 8. Section 6.205, Business Organizations Code, is
131	131	amended to read as follows:
132	132	Sec. 6.205. REPRODUCTION OR ELECTRONIC TRANSMISSION OF
133	133	CONSENT. (a) Any photographic, photostatic, facsimile, or
134	134	similarly reliable reproduction of a consent in writing signed by
135	135	an owner, member, or governing person of a filing entity may be
136	136	substituted or used instead of the original writing for any purpose
137	137	for which the original writing could be used, if the reproduction is
138	138	a complete reproduction of the entire original writing.
139	139	(b) Except as otherwise provided by an entity's governing
140	140	documents, an electronic transmission of a consent by an owner,
141	141	member, or governing person to the taking of an action by the entity
142	142	is considered a signed writing if the transmission contains or is
143	143	accompanied by information from which it can be determined:
144	144	(1) that the electronic transmission was transmitted
145	145	by the owner, member, or governing person; and
146	146	(2) the date on which the owner, member, or governing
147	147	person transmitted the electronic transmission.
148	148	(c) Unless the consent is otherwise dated, the date
149	149	specified in Subsection (b)(2) is the date on which the consent is
150	150	considered signed.
151	151	SECTION 9. Subchapter A, Chapter 9, Business Organizations
152	152	Code, is amended by adding Section 9.005 to read as follows:
153	153	Sec. 9.005. SUPPLEMENTAL INFORMATION REQUIRED IN
154	154	APPLICATION FOR REGISTRATION OF FOREIGN LIMITED LIABILITY COMPANY.
155	155	(a) This section applies only to a foreign limited liability
156	156	company governed by a company agreement that establishes or
157	157	provides for the establishment of a designated series of members,
158	158	managers, membership interests, or assets that has any of the
159	159	characteristics described by Subsection (b).
160	160	(b) A foreign limited liability company must state in its
161	161	application for registration as a foreign limited liability company
162	162	whether:
163	163	(1) the series has:
164	164	(A) separate rights, powers, or duties with
165	165	respect to specified property or obligations of the foreign limited
166	166	liability company; or
167	167	(B) separate profits and losses associated with
168	168	specified property or obligations of the foreign limited liability
169	169	company;
170	170	(2) any debts, liabilities, obligations, and expenses
171	171	incurred, contracted for, or otherwise existing with respect to a
172	172	particular series shall be enforceable against the assets of that
173	173	series only, and not against the assets of the company generally or
174	174	the assets of any other series; and
175	175	(3) any debts, liabilities, obligations, and expenses
176	176	incurred, contracted for, or otherwise existing with respect to the
177	177	company generally or any other series shall be enforceable against
178	178	the assets of that series.
179	179	SECTION 10. Subsection (a), Section 9.009, Business
180	180	Organizations Code, is amended to read as follows:
181	181	(a) A foreign filing entity must amend its registration to
182	182	reflect:
183	183	(1) a change to its name; [or]
184	184	(2) a change in the business or activity stated in its
185	185	application for registration; and
186	186	(3) if the foreign filing entity is a limited
187	187	partnership:
188	188	(A) the admission of a new general partner;
189	189	(B) the withdrawal of a general partner; and
190	190	(C) a change in the name of the general partner
191	191	stated in its application for registration [or business or activity
192	192	has changed].
193	193	SECTION 11. Subsection (c), Section 9.011, Business
194	194	Organizations Code, is amended to read as follows:
195	195	(c) A certificate from the comptroller stating that all
196	196	[franchise] taxes administered by the comptroller under Title 2,
197	197	Tax Code, have been paid must be filed with the certificate of
198	198	withdrawal in accordance with Chapter 4 if the foreign filing
199	199	entity is a taxable entity under Chapter 171, Tax Code, other than a
200	200	foreign nonprofit [professional] corporation[, foreign for-profit
201	201	corporation, or foreign limited liability company].
202	202	SECTION 12. Subchapter A, Chapter 9, Business Organizations
203	203	Code, is amended by adding Section 9.012 to read as follows:
204	204	Sec. 9.012. AUTOMATIC WITHDRAWAL ON CONVERSION TO DOMESTIC
205	205	FILING ENTITY. A foreign filing entity or foreign limited
206	206	liability partnership registered in this state that converts to a
207	207	domestic filing entity is considered to have withdrawn its
208	208	registration on the effective date of the conversion. This section
209	209	also applies to a conversion and continuance under Section 10.1025.
210	210	SECTION 13. Subsection (d), Section 9.104, Business
211	211	Organizations Code, is amended to read as follows:
212	212	(d) A tax clearance letter [of eligibility] from the
213	213	comptroller stating that the foreign filing entity has satisfied
214	214	all franchise tax liabilities and its registration may be
215	215	reinstated must be filed with the certificate of reinstatement if
216	216	the foreign filing entity is a taxable entity under Chapter 171, Tax
217	217	Code, other than a foreign nonprofit [professional] corporation[,
218	218	for-profit corporation, or limited liability company].
219	219	SECTION 14. Section 9.251, Business Organizations Code, is
220	220	amended to read as follows:
221	221	Sec. 9.251. ACTIVITIES NOT CONSTITUTING TRANSACTING
222	222	BUSINESS IN THIS STATE. For purposes of this chapter, activities
223	223	that do not constitute transaction of business in this state
224	224	include:
225	225	(1) maintaining or defending an action or suit or an
226	226	administrative or arbitration proceeding, or effecting the
227	227	settlement of:
228	228	(A) such an action, suit, or proceeding; or
229	229	(B) a claim or dispute to which the entity is a
230	230	party;
231	231	(2) holding a meeting of the entity's managerial
232	232	officials, owners, or members or carrying on another activity
233	233	concerning the entity's internal affairs;
234	234	(3) maintaining a bank account;
235	235	(4) maintaining an office or agency for:
236	236	(A) transferring, exchanging, or registering
237	237	securities the entity issues; or
238	238	(B) appointing or maintaining a trustee or
239	239	depositary related to the entity's securities;
240	240	(5) voting the interest of an entity the foreign
241	241	entity has acquired;
242	242	(6) effecting a sale through an independent
243	243	contractor;
244	244	(7) creating, as borrower or lender, or acquiring
245	245	indebtedness or a mortgage or other security interest in real or
246	246	personal property;
247	247	(8) securing or collecting a debt due the entity or
248	248	enforcing a right in property that secures a debt due the entity;
249	249	(9) transacting business in interstate commerce;
250	250	(10) conducting an isolated transaction that:
251	251	(A) is completed within a period of 30 days; and
252	252	(B) is not in the course of a number of repeated,
253	253	similar transactions;
254	254	(11) in a case that does not involve an activity that
255	255	would constitute the transaction of business in this state if the
256	256	activity were one of a foreign entity acting in its own right:
257	257	(A) exercising a power of executor or
258	258	administrator of the estate of a nonresident decedent under
259	259	ancillary letters issued by a court of this state; or
260	260	(B) exercising a power of a trustee under the
261	261	will of a nonresident decedent, or under a trust created by one or
262	262	more nonresidents of this state, or by one or more foreign entities;
263	263	(12) regarding a debt secured by a mortgage or lien on
264	264	real or personal property in this state:
265	265	(A) acquiring the debt in a transaction outside
266	266	this state or in interstate commerce;
267	267	(B) collecting or adjusting a principal or
268	268	interest payment on the debt;
269	269	(C) enforcing or adjusting a right or property
270	270	securing the debt;
271	271	(D) taking an action necessary to preserve and
272	272	protect the interest of the mortgagee in the security; or
273	273	(E) engaging in any combination of transactions
274	274	described by this subdivision;
275	275	(13) investing in or acquiring, in a transaction
276	276	outside of this state, a royalty or other nonoperating mineral
277	277	interest; [or]
278	278	(14) executing [the execution of] a division order,
279	279	contract of sale, or other instrument incidental to ownership of a
280	280	nonoperating mineral interest; or
281	281	(15) owning, without more, real or personal property
282	282	in this state.
283	283	SECTION 15. Subchapter C, Chapter 10, Business
284	284	Organizations Code, is amended by adding Section 10.1025 to read as
285	285	follows:
286	286	Sec. 10.1025. CONVERSION AND CONTINUANCE. (a) A
287	287	converting entity may elect to continue its existence in its
288	288	current organizational form and jurisdiction of formation in
289	289	connection with the entity's:
290	290	(1) conversion under Section 10.101 as a domestic
291	291	entity of one organizational form into a non-United States entity
292	292	of the same organizational form; or
293	293	(2) conversion under Section 10.102 as a non-United
294	294	States entity of one organizational form into a domestic entity of
295	295	the same organizational form.
296	296	(b) The election permitted by Subsection (a) for the
297	297	converting entity to continue its existence in its current
298	298	organizational form and jurisdiction of formation must be:
299	299	(1) adopted and approved as part of the plan of
300	300	conversion for the converting entity as required by Section
301	301	10.101(b) or 10.102(b), as applicable; and
302	302	(2) permitted by, or not prohibited by and
303	303	inconsistent with, the laws of the applicable non-United States
304	304	jurisdiction.
305	305	(c) Section 10.156(2) does not apply in connection with the
306	306	filing of the certificate of conversion if the converting entity is
307	307	a domestic filing entity that elects to continue its existence in
308	308	accordance with this section.
309	309	(d) Chapter 9 does not apply to a non-United States entity
310	310	that also exists as a domestic filing entity because of a conversion
311	311	and election to continue its existence in accordance with this
312	312	section.
313	313	SECTION 16. Subsection (a), Section 10.103, Business
314	314	Organizations Code, is amended to read as follows:
315	315	(a) A plan of conversion must include:
316	316	(1) the name of the converting entity;
317	317	(2) the name of the converted entity;
318	318	(3) a statement that the converting entity is
319	319	continuing its existence in the organizational form of the
320	320	converted entity;
321	321	(4) a statement of the type of entity that the
322	322	converted entity is to be and the converted entity's jurisdiction
323	323	of formation;
324	324	(5) if Sections 10.1025 and 10.109 do not apply, the
325	325	manner and basis of converting the ownership or membership
326	326	interests of the converting entity into ownership or membership
327	327	interests of the converted entity;
328	328	(6) any certificate of formation required to be filed
329	329	under this code if the converted entity is a filing entity; [and]
330	330	(7) the certificate of formation or similar
331	331	organizational document of the converted entity if the converted
332	332	entity is not a filing entity; and
333	333	(8) if Sections 10.1025 and 10.109 apply, a statement
334	334	that the converting entity is electing to continue its existence in
335	335	its current organizational form and jurisdiction of formation after
336	336	the conversion takes effect.
337	337	SECTION 17. Subchapter C, Chapter 10, Business
338	338	Organizations Code, is amended by adding Section 10.109 to read as
339	339	follows:
340	340	Sec. 10.109. SPECIAL PROVISIONS APPLYING TO CONVERSION AND
341	341	CONTINUANCE. (a) This section applies only to a converting entity
342	342	that elects to continue its existence in accordance with Section
343	343	10.1025.
344	344	(b) When the conversion of a converting entity to which this
345	345	section applies takes effect:
346	346	(1) notwithstanding Section 10.106(1), the converting
347	347	entity continues to exist both in its current organizational form
348	348	and jurisdiction of formation and, as the converted entity, in the
349	349	same organizational form in the new jurisdiction of formation;
350	350	(2) the converting entity and the converted entity,
351	351	for purposes of the laws of this state, constitute a single entity
352	352	formed, incorporated, created, or otherwise having come into being,
353	353	as applicable, and existing under the laws of this state and the
354	354	laws of the applicable non-United States jurisdiction, so long as
355	355	the entity continues to exist as a domestic entity under the laws of
356	356	this state following the conversion;
357	357	(3) if the converting entity is a domestic entity,
358	358	this code and the other laws of this state apply to the converted
359	359	entity to the same extent as the laws applied to the entity before
360	360	the conversion;
361	361	(4) if the converting entity is a non-United States
362	362	entity, the laws of the applicable non-United States jurisdiction
363	363	apply to the converted entity to the same extent as the laws applied
364	364	to the entity before the conversion;
365	365	(5) notwithstanding Section 10.106(2), all rights,
366	366	title, and interests in all property owned by the converting entity
367	367	continue to be owned by the converted entity, subject to any
368	368	existing liens or other encumbrances on the property, in both the
369	369	organizational form of the converting entity and the organizational
370	370	form of the converted entity without:
371	371	(A) reversion or impairment;
372	372	(B) further act or deed; or
373	373	(C) the occurrence of a transfer or assignment;
374	374	and
375	375	(6) notwithstanding Section 10.106(3), all
376	376	liabilities and obligations of the converting entity remain the
377	377	liabilities and obligations of the converted entity in both the
378	378	organizational form of the converting entity and the organizational
379	379	form of the converted entity without impairment or diminution
380	380	because of the conversion.
381	381	SECTION 18. Section 10.154, Business Organizations Code, is
382	382	amended by adding Subsection (c) to read as follows:
383	383	(c) In addition to complying with the requirements of
384	384	Subsections (a) and (b), if Sections 10.1025 and 10.109 apply to the
385	385	conversion, the certificate of conversion required by this section
386	386	must:
387	387	(1) be titled "Certificate of Conversion and
388	388	Continuance"; and
389	389	(2) include a statement certifying that the converting
390	390	entity is electing to continue its existence in its current
391	391	organizational form and jurisdiction of formation.
392	392	SECTION 19. Section 10.361, Business Organizations Code, is
393	393	amended by adding Subsection (g) to read as follows:
394	394	(g) The beneficial owner of an ownership interest subject to
395	395	dissenters' rights held in a voting trust or by a nominee on the
396	396	beneficial owner's behalf may file a petition described by
397	397	Subsection (a) if no agreement between the dissenting owner of the
398	398	ownership interest and the responsible organization has been
399	399	reached within the period prescribed by Section 10.358(d). When
400	400	the beneficial owner files a petition described by Subsection (a):
401	401	(1) the beneficial owner shall at that time be
402	402	considered, for purposes of this subchapter, the owner, the
403	403	dissenting owner, and the holder of the ownership interest subject
404	404	to the petition; and
405	405	(2) the dissenting owner who demanded payment under
406	406	Section 10.356 has no further rights regarding the ownership
407	407	interest subject to the petition.
408	408	SECTION 20. Subsection (b), Section 10.366, Business
409	409	Organizations Code, is amended to read as follows:
410	410	(b) An owner who has demanded payment for the owner's
411	411	ownership interest under Section 10.356 is not entitled to vote or
412	412	exercise any other rights of an [another] owner with respect to the
413	413	ownership interest except the right to:
414	414	(1) receive payment for the ownership interest under
415	415	this subchapter; and
416	416	(2) bring an appropriate action to obtain relief on
417	417	the ground that the action to which the demand relates would be or
418	418	was fraudulent.
419	419	SECTION 21. Subsection (b), Section 10.367, Business
420	420	Organizations Code, is amended to read as follows:
421	421	(b) On termination of the right of dissent under this
422	422	section:
423	423	(1) the dissenting owner and all persons claiming a
424	424	right under the owner are conclusively presumed to have approved
425	425	and ratified the action to which the owner dissented and are bound
426	426	by that action;
427	427	(2) the owner's right to be paid the fair value of the
428	428	owner's ownership interests ceases;
429	429	(3) [and] the owner's status as an owner of those
430	430	ownership interests is restored, as if the owner's demand for
431	431	payment of the fair value of the ownership interests had not been
432	432	made under Section 10.356, [without prejudice to any interim
433	433	proceeding] if the owner's ownership interests were not canceled,
434	434	converted, or exchanged as a result of the action or a subsequent
435	435	action;
436	436	(4) the dissenting owner is entitled to receive the
437	437	same cash, property, rights, and other consideration received by
438	438	owners of the same class and series of ownership interests held by
439	439	the owner, as if the owner's demand for payment of the fair value of
440	440	the ownership interests had not been made under Section 10.356, if
441	441	the owner's ownership interests were canceled, converted, or
442	442	exchanged as a result of the action or a subsequent action;
443	443	(5) any action of the domestic entity taken after the
444	444	date of the demand for payment by the owner under Section 10.356
445	445	will not be considered ineffective or invalid because of the
446	446	restoration of the owner's ownership interests or the other rights
447	447	or entitlements of the owner under this subsection; and
448	448	(6) [fundamental business transaction; and
449	449	[(3)] the dissenting owner is entitled to receive
450	450	dividends or other distributions made after the date of the owner's
451	451	payment demand under Section 10.356, [in the interim] to owners of
452	452	the same class and series of ownership interests held by the owner
453	453	as if the [a] demand [for the payment of the ownership interests]
454	454	had not been made [under Section 10.356], subject to any change in
455	455	or adjustment to the ownership interests because of an action taken
456	456	by the domestic entity [the cancellation or exchange of the
457	457	ownership interests] after the date of the [a] demand [under
458	458	Section 10.356 was made pursuant to a fundamental business
459	459	transaction].
460	460	SECTION 22. Subsection (b), Section 11.101, Business
461	461	Organizations Code, is amended to read as follows:
462	462	(b) A certificate from the comptroller that all taxes
463	463	administered by the comptroller under Title 2, Tax Code, have been
464	464	paid must be filed with the certificate of termination [in
465	465	accordance with Chapter 4] if the filing entity is a taxable entity
466	466	under Chapter 171, Tax Code, other than a nonprofit [professional]
467	467	corporation[, for-profit corporation, or limited liability
468	468	company].
469	469	SECTION 23. Subsection (e), Section 11.202, Business
470	470	Organizations Code, is amended to read as follows:
471	471	(e) A tax clearance letter [of eligibility] from the
472	472	comptroller stating that the filing entity has satisfied all
473	473	franchise tax liabilities and may be reinstated must be filed with
474	474	the certificate of reinstatement if the filing entity is a taxable
475	475	entity under Chapter 171, Tax Code, other than a nonprofit
476	476	[professional] corporation[, for-profit corporation, or limited
477	477	liability company].
478	478	SECTION 24. Subsection (c), Section 11.253, Business
479	479	Organizations Code, is amended to read as follows:
480	480	(c) A certificate of reinstatement must be accompanied by:
481	481	(1) each amendment to the entity's certificate of
482	482	formation that is required by intervening events, including
483	483	circumstances requiring an amendment to the filing entity's name as
484	484	described in Section 11.203; and
485	485	(2) a tax clearance letter from the comptroller
486	486	stating that the filing entity has satisfied all franchise tax
487	487	liabilities and may be reinstated, if the filing entity is a taxable
488	488	entity under Chapter 171, Tax Code, other than a nonprofit
489	489	corporation.
490	490	SECTION 25. Section 11.314, Business Organizations Code, is
491	491	amended to read as follows:
492	492	Sec. 11.314. INVOLUNTARY WINDING UP AND TERMINATION OF
493	493	PARTNERSHIP OR LIMITED LIABILITY COMPANY. A district court in the
494	494	county in which the registered office or principal place of
495	495	business in this state of a domestic partnership or limited
496	496	liability company is located has jurisdiction to order the winding
497	497	up and termination of the domestic partnership or limited liability
498	498	company on application by:
499	499	(1) a partner in the partnership if the court
500	500	determines that:
501	501	(A) the economic purpose of the partnership is
502	502	likely to be unreasonably frustrated; or
503	503	(B) another partner has engaged in conduct
504	504	relating to the partnership's business that makes it not reasonably
505	505	practicable to carry on the business in partnership with that
506	506	partner; or
507	507	(2) an owner of the partnership or limited liability
508	508	company if the court determines that it is not reasonably
509	509	practicable to carry on the entity's business in conformity with
510	510	its governing documents.
511	511	SECTION 26. Section 12.001, Business Organizations Code, is
512	512	amended by adding Subsections (c) and (d) to read as follows:
513	513	(c) The secretary of state, on acceptance of the filing of
514	514	an instrument authorized to be filed with the secretary of state
515	515	under this code, may issue:
516	516	(1) a certificate that evidences the filing of the
517	517	instrument;
518	518	(2) a letter that acknowledges the filing of the
519	519	instrument; or
520	520	(3) a certificate that evidences the filing of the
521	521	instrument and a letter that acknowledges the filing of the
522	522	instrument.
523	523	(d) This section and Sections 12.003 and 12.004 do not apply
524	524	to a domestic real estate investment trust.
525	525	SECTION 27. Section 21.152, Business Organizations Code, is
526	526	amended by amending Subsections (a) and (c) and adding Subsection
527	527	(d) to read as follows:
528	528	(a) A corporation's certificate of formation may divide the
529	529	corporation's authorized shares into one or more classes and may
530	530	divide one or more classes into one or more series. If more than one
531	531	class or series of shares is authorized, the [The] certificate of
532	532	formation must designate each class and series of authorized shares
533	533	to distinguish that class and series from any other class or series.
534	534	(c) Shares of the same class must be identical in all
535	535	respects unless the shares have been divided into one or more
536	536	series. If the shares of a class have been divided into one or more
537	537	series, the shares may vary between series, but all shares of the
538	538	same series must [will] be identical in all respects.
539	539	(d) A corporation's certificate of formation must
540	540	authorize:
541	541	(1) one or more classes or series of shares that
542	542	together have unlimited voting rights; and
543	543	(2) one or more classes or series of shares, which may
544	544	be the same class or series of shares as those with voting rights,
545	545	that together are entitled to receive the net assets of the
546	546	corporation on winding up and termination.
547	547	SECTION 28. Subsection (a), Section 21.153, Business
548	548	Organizations Code, is amended to read as follows:
549	549	(a) If more than one class or series of shares is authorized
550	550	under Section 21.152(d), the certificate of formation must state
551	551	[Each class or series of authorized shares of a corporation must
552	552	have] the designations, preferences, limitations, and relative
553	553	rights, including voting rights, of each class or series [stated in
554	554	the corporation's certificate of formation].
555	555	SECTION 29. Subsection (a), Section 21.154, Business
556	556	Organizations Code, is amended to read as follows:
557	557	(a) Subject to Sections 21.152 and [Section] 21.153, if
558	558	authorized by the corporation's certificate of formation, a
559	559	corporation may issue shares that:
560	560	(1) are redeemable, at the option of the corporation,
561	561	shareholder, or other person or on the occurrence of a designated
562	562	event, subject to Sections 21.303 and 21.304;
563	563	(2) entitle the holders of the shares to cumulative,
564	564	noncumulative, or partially cumulative distributions;
565	565	(3) have preferences over any or all other classes or
566	566	series of shares with respect to payment of distributions;
567	567	(4) have preferences over any or all other classes or
568	568	series of shares with respect to the assets of the corporation on
569	569	the voluntary or involuntary winding up and termination of the
570	570	corporation;
571	571	(5) are exchangeable, at the option of the
572	572	corporation, shareholder, or other person or on the occurrence of a
573	573	designated event, for shares, obligations, indebtedness, evidence
574	574	of ownership, rights to purchase securities of the corporation or
575	575	one or more other entities, or other property or for a combination
576	576	of those rights, assets, or obligations, subject to Section 21.303;
577	577	and
578	578	(6) are convertible into shares of any other class or
579	579	series, at the option of the corporation, shareholder, or other
580	580	person or on the occurrence of a designated event.
581	581	SECTION 30. Section 21.157, Business Organizations Code, is
582	582	amended by adding Subsection (c) to read as follows:
583	583	(c) This subsection applies only to shares issued in
584	584	accordance with Subsections (a) and (b) and Sections 21.160 and
585	585	21.161 for consideration consisting, wholly or partly, of a
586	586	contract for future services or benefits or a promissory note. A
587	587	corporation may place the shares, although fully paid and
588	588	nonassessable, in escrow, or make other arrangements to restrict
589	589	the transfer of the shares, and may credit distributions made with
590	590	respect to the shares against their purchase price, until the
591	591	services are performed, the note is paid, or the benefits are
592	592	received. If the services are not performed, the note is not paid,
593	593	or the benefits are not received, the corporation may pursue
594	594	remedies provided or afforded under law or in the contract or note,
595	595	including causing the shares that are placed in escrow or
596	596	restricted to be forfeited or returned to or reacquired by the
597	597	corporation and the distributions that have been credited to be
598	598	wholly or partly returned to the corporation.
599	599	SECTION 31. Subsection (a), Section 21.163, Business
600	600	Organizations Code, is amended to read as follows:
601	601	(a) A corporation may:
602	602	(1) issue fractions of a share, either certificated or
603	603	uncertificated;
604	604	(2) arrange for the disposition of fractional
605	605	interests by persons entitled to the interests;
606	606	(3) pay cash for the fair value of fractions of a share
607	607	determined when the shareholders entitled to receive the fractions
608	608	are determined; or
609	609	(4) subject to Subsection (b), issue scrip in
610	610	registered [or bearer] form that entitles the holder to receive a
611	611	certificate for a full share or an uncertificated full share on the
612	612	surrender of the scrip aggregating a full share.
613	613	SECTION 32. Section 21.171, Business Organizations Code, is
614	614	amended to read as follows:
615	615	Sec. 21.171. OUTSTANDING OR TREASURY SHARES. (a) Shares
616	616	that are issued are outstanding shares unless the shares are
617	617	treasury shares or are canceled.
618	618	(b) If there are outstanding shares, one or more shares that
619	619	together have unlimited voting rights and one or more shares that
620	620	together are entitled to receive the net assets of the corporation
621	621	on the winding up and termination of the corporation must be
622	622	outstanding shares.
623	623	(c) Treasury shares are considered to be issued shares and
624	624	not outstanding shares.
625	625	(d) [(b)] Treasury shares may not be included in the total
626	626	assets of a corporation for purposes of determining the net assets
627	627	of a corporation.
628	628	SECTION 33. Section 21.201, Business Organizations Code, is
629	629	amended to read as follows:
630	630	Sec. 21.201. REGISTERED HOLDERS AS OWNERS; SHARES HELD BY
631	631	NOMINEES. (a) Except as otherwise provided by this code and
632	632	subject to Chapter 8, Business & Commerce Code, a corporation may
633	633	consider the person registered as the owner of a share in the share
634	634	transfer records of the corporation at a particular time, including
635	635	a record date set under Section 6.101 or 6.102 or Subchapter H, as
636	636	the owner of that share at that time for purposes of:
637	637	(1) voting the share;
638	638	(2) receiving distributions on the share;
639	639	(3) transferring the share;
640	640	(4) receiving notice, exercising rights of dissent,
641	641	exercising or waiving a preemptive right, or giving proxies with
642	642	respect to that share;
643	643	(5) entering into agreements with respect to that
644	644	share in accordance with Section 6.251, 6.252, or 21.210; or
645	645	(6) any other shareholder action.
646	646	(b) A corporation may establish a procedure by which the
647	647	corporation recognizes as a shareholder the beneficial owner of
648	648	shares registered in the name of a nominee.
649	649	(c) A procedure established under Subsection (b) must:
650	650	(1) determine the extent of the corporation's
651	651	recognition of the beneficial owner as a shareholder; and
652	652	(2) include the nominee's filing of a statement with
653	653	the corporation that contains information regarding the beneficial
654	654	owner.
655	655	(d) A procedure established under Subsection (b) may set
656	656	forth:
657	657	(1) the types of nominees to which the procedure
658	658	applies;
659	659	(2) the rights or privileges that the corporation will
660	660	recognize in a beneficial owner, to the extent that the rights or
661	661	privileges are not inconsistent with Section 10.361(g);
662	662	(3) the manner in which the procedure is selected by
663	663	the nominee;
664	664	(4) the information that must be provided when the
665	665	procedure is selected;
666	666	(5) the period for which the selection of the
667	667	procedure is effective; and
668	668	(6) any other aspect of the rights and duties to be
669	669	established under the procedure.
670	670	SECTION 34. Section 21.224, Business Organizations Code, is
671	671	amended to read as follows:
672	672	Sec. 21.224. PREEMPTION OF LIABILITY. The liability of a
673	673	holder, beneficial owner, or subscriber of shares of a corporation,
674	674	or any affiliate of such a holder, owner, or subscriber or of the
675	675	corporation, for an obligation that is limited by Section 21.223 is
676	676	exclusive and preempts any other liability imposed for that
677	677	obligation under common law or otherwise.
678	678	SECTION 35. Subsection (a), Section 21.361, Business
679	679	Organizations Code, is amended to read as follows:
680	680	(a) At [If expressly authorized by a corporation's
681	681	certificate of formation in general or with respect to a specified
682	682	class or series of shares or group of classes or series of shares
683	683	and subject to Subsections (b) and (c), at] each election of
684	684	directors of the corporation, each shareholder entitled to vote at
685	685	the election is entitled to:
686	686	(1) vote the number of shares owned by the shareholder
687	687	for as many candidates as there are directors to be elected and for
688	688	whose election the shareholder is entitled to vote; or
689	689	(2) if expressly authorized by a corporation's
690	690	certificate of formation in general or with respect to a specified
691	691	class or series of shares or group of classes or series of shares
692	692	and subject to Subsections (b) and (c), cumulate votes by:
693	693	(A) giving one candidate as many votes as the
694	694	total of the number of the directors to be elected multiplied by the
695	695	shareholder's shares; or
696	696	(B) distributing the votes among one or more
697	697	candidates using the same principle.
698	698	SECTION 36. Subsection (a), Section 21.406, Business
699	699	Organizations Code, is amended to read as follows:
700	700	(a) The certificate of formation of a corporation may
701	701	provide that directors, regardless of whether elected by the
702	702	holders of a class or series of shares or by a group of classes or
703	703	series of shares [entitled to elect one or more directors], as
704	704	provided by Section 21.405, are entitled to cast more or less than
705	705	one vote on all matters or on specified matters. Such a provision
706	706	also applies to directors voting in any committee or subcommittee
707	707	regarding all matters or the specified matters, as applicable,
708	708	unless otherwise provided by the certificate of formation.
709	709	SECTION 37. Subsection (b), Section 21.418, Business
710	710	Organizations Code, is amended to read as follows:
711	711	(b) An otherwise valid contract or transaction described by
712	712	Subsection (a) is valid notwithstanding that the [a] director or
713	713	officer having the relationship or interest described by Subsection
714	714	(a) [of the corporation] is present at or participates in the
715	715	meeting of the board of directors, or of a committee of the board
716	716	that authorizes the contract or transaction, or votes or signs, in
717	717	the person's capacity as a director or committee member, a
718	718	unanimous written consent of directors or committee members to
719	719	authorize the contract or transaction, if:
720	720	(1) the material facts as to the relationship or
721	721	interest described by Subsection (a) and as to the contract or
722	722	transaction are disclosed to or known by:
723	723	(A) the corporation's board of directors or a
724	724	committee of the board of directors and the board of directors or
725	725	committee in good faith authorizes the contract or transaction by
726	726	the approval [affirmative vote] of the majority of the
727	727	disinterested directors or committee members, regardless of
728	728	whether the disinterested directors or committee members
729	729	constitute a quorum; or
730	730	(B) the shareholders entitled to vote on the
731	731	authorization of the contract or transaction, and the contract or
732	732	transaction is specifically approved in good faith by a vote of the
733	733	shareholders; or
734	734	(2) the contract or transaction is fair to the
735	735	corporation when the contract or transaction is authorized,
736	736	approved, or ratified by the board of directors, a committee of the
737	737	board of directors, or the shareholders.
738	738	SECTION 38. Subsection (a), Section 101.054, Business
739	739	Organizations Code, is amended to read as follows:
740	740	(a) Except as provided by this section, the following
741	741	provisions may not be waived or modified in the company agreement of
742	742	a limited liability company:
743	743	(1) this section;
744	744	(2) Section 101.101 [101.101(b)], 101.151, 101.206,
745	745	101.501, or 101.502;
746	746	(3) Chapter 1, if the provision is used to interpret a
747	747	provision or define a word or phrase contained in a section listed
748	748	in this subsection;
749	749	(4) Chapter 2, except that Section 2.104(c)(2),
750	750	2.104(c)(3), or 2.113 may be waived or modified in the company
751	751	agreement;
752	752	(5) Chapter 3, except that Subchapters C and E may be
753	753	waived or modified in the company agreement; or
754	754	(6) Chapter 4, 5, 7, 10, 11, or 12, other than Section
755	755	11.056.
756	756	SECTION 39. Section 101.106, Business Organizations Code,
757	757	is amended by adding Subsection (c) to read as follows:
758	758	(c) Sections 9.406 and 9.408, Business & Commerce Code, do
759	759	not apply to a membership interest in a limited liability company,
760	760	including the rights, powers, and interests arising under the
761	761	company's certificate of formation or company agreement or under
762	762	this code. To the extent of any conflict between this subsection
763	763	and Section 9.406 or 9.408, Business & Commerce Code, this
764	764	subsection controls. It is the express intent of this subsection to
765	765	permit the enforcement, as a contract among the members of a limited
766	766	liability company, of any provision of a company agreement that
767	767	would otherwise be ineffective under Section 9.406 or 9.408,
768	768	Business & Commerce Code.
769	769	SECTION 40. Subsection (c), Section 101.112, Business
770	770	Organizations Code, is amended to read as follows:
771	771	(c) A charging order constitutes a lien on the judgment
772	772	debtor's membership interest. The charging order lien may not be
773	773	foreclosed on under this code or any other law.
774	774	SECTION 41. Section 101.206, Business Organizations Code,
775	775	is amended by amending Subsections (a) and (d) and adding
776	776	Subsection (f) to read as follows:
777	777	(a) Unless the distribution is made in compliance with
778	778	Chapter 11, a [A] limited liability company may not make a
779	779	distribution to a member of the company if, immediately after
780	780	making the distribution, the company's total liabilities, other
781	781	than liabilities described by Subsection (b), exceed the fair value
782	782	of the company's total assets.
783	783	(d) A member of a limited liability company who receives a
784	784	distribution from the company in violation of this section is not
785	785	required to return the distribution to the company unless [if] the
786	786	member had knowledge of the violation.
787	787	(f) For purposes of this section, "distribution" does not
788	788	include an amount constituting reasonable compensation for present
789	789	or past services or a reasonable payment made in the ordinary course
790	790	of business under a bona fide retirement plan or other benefits
791	791	program.
792	792	SECTION 42. Subchapter E, Chapter 101, Business
793	793	Organizations Code, is amended by adding Section 101.208 to read as
794	794	follows:
795	795	Sec. 101.208. RECORD DATE. A company agreement may
796	796	establish or provide for the establishment of a record date with
797	797	respect to allocations and distributions.
798	798	SECTION 43. The heading to Section 101.251, Business
799	799	Organizations Code, is amended to read as follows:
800	800	Sec. 101.251. GOVERNING AUTHORITY [MEMBERSHIP].
801	801	SECTION 44. Subsection (b), Section 101.255, Business
802	802	Organizations Code, is amended to read as follows:
803	803	(b) An otherwise valid contract or transaction described by
804	804	Subsection (a) is valid notwithstanding that the [a] governing
805	805	person or officer having the relationship or interest described by
806	806	Subsection (a) [of the company] is present at or participates in the
807	807	meeting of the governing authority, or of a committee of the
808	808	governing [person's] authority, that authorizes the contract or
809	809	transaction or votes or signs, in the person's capacity as a
810	810	governing person or committee member, a written consent of
811	811	governing persons or committee members to authorize the contract or
812	812	transaction, if:
813	813	(1) the material facts as to the relationship or
814	814	interest described by Subsection (a) and as to the contract or
815	815	transaction are disclosed to or known by:
816	816	(A) the company's governing authority or a
817	817	committee of the governing authority and the governing authority or
818	818	committee in good faith authorizes the contract or transaction by
819	819	the approval [affirmative vote] of the majority of the
820	820	disinterested governing persons or committee members, regardless
821	821	of whether the disinterested governing persons or committee members
822	822	constitute a quorum; or
823	823	(B) the members of the company, and the members
824	824	in good faith approve the contract or transaction by vote of the
825	825	members; or
826	826	(2) the contract or transaction is fair to the company
827	827	when the contract or transaction is authorized, approved, or
828	828	ratified by the governing authority, a committee of the governing
829	829	authority, or the members of the company.
830	830	SECTION 45. Chapter 101, Business Organizations Code, is
831	831	amended by adding Subchapter M to read as follows:
832	832	SUBCHAPTER M. SERIES LIMITED LIABILITY COMPANY
833	833	Sec. 101.601. SERIES OF MEMBERS, MANAGERS, MEMBERSHIP
834	834	INTERESTS, OR ASSETS. (a) A company agreement may establish or
835	835	provide for the establishment of one or more designated series of
836	836	members, managers, membership interests, or assets that:
837	837	(1) has separate rights, powers, or duties with
838	838	respect to specified property or obligations of the limited
839	839	liability company or profits and losses associated with specified
840	840	property or obligations; or
841	841	(2) has a separate business purpose or investment
842	842	objective.
843	843	(b) A series established in accordance with Subsection (a)
844	844	may carry on any business, purpose, or activity, whether or not for
845	845	profit, that is not prohibited by Section 2.003.
846	846	Sec. 101.602. ENFORCEABILITY OF OBLIGATIONS AND EXPENSES OF
847	847	SERIES AGAINST ASSETS. (a) Notwithstanding any other provision of
848	848	this chapter or any other law, but subject to Subsection (b) and any
849	849	other provision of this subchapter:
850	850	(1) the debts, liabilities, obligations, and expenses
851	851	incurred, contracted for, or otherwise existing with respect to a
852	852	particular series shall be enforceable against the assets of that
853	853	series only, and shall not be enforceable against the assets of the
854	854	limited liability company generally or any other series; and
855	855	(2) none of the debts, liabilities, obligations, and
856	856	expenses incurred, contracted for, or otherwise existing with
857	857	respect to the limited liability company generally or any other
858	858	series shall be enforceable against the assets of a particular
859	859	series.
860	860	(b) Subsection (a) applies only if:
861	861	(1) the records maintained for that particular series
862	862	account for the assets associated with that series separately from
863	863	the other assets of the company or any other series;
864	864	(2) the company agreement contains a statement to the
865	865	effect of the limitations provided in Subsection (a); and
866	866	(3) the company's certificate of formation contains a
867	867	notice of the limitations provided in Subsection (a).
868	868	Sec. 101.603. ASSETS OF SERIES. (a) Assets associated
869	869	with a series may be held directly or indirectly, including being
870	870	held in the name of the series, in the name of the limited liability
871	871	company, through a nominee, or otherwise.
872	872	(b) If the records of a series are maintained in a manner so
873	873	that the assets of the series can be reasonably identified by
874	874	specific listing, category, type, quantity, or computational or
875	875	allocational formula or procedure, including a percentage or share
876	876	of any assets, or by any other method in which the identity of the
877	877	assets can be objectively determined, the records are considered to
878	878	satisfy the requirements of Section 101.602(b)(1).
879	879	Sec. 101.604. NOTICE OF LIMITATION ON LIABILITIES OF
880	880	SERIES. Notice of the limitation on liabilities of a series
881	881	required by Section 101.602 that is contained in a certificate of
882	882	formation filed with the secretary of state satisfies the
883	883	requirements of Section 101.602(b)(3), regardless of whether:
884	884	(1) the limited liability company has established any
885	885	series under this subchapter when the notice is contained in the
886	886	certificate of formation; and
887	887	(2) the notice makes a reference to a specific series
888	888	of the limited liability company.
889	889	Sec. 101.605. GENERAL POWERS OF SERIES. A series
890	890	established under this subchapter has the power and capacity, in
891	891	the series' own name, to:
892	892	(1) sue and be sued;
893	893	(2) contract;
894	894	(3) hold title to assets of the series, including real
895	895	property, personal property, and intangible property; and
896	896	(4) grant liens and security interests in assets of
897	897	the series.
898	898	Sec. 101.606. LIABILITY OF MEMBER OR MANAGER FOR
899	899	OBLIGATIONS; DUTIES. (a) Except as and to the extent the company
900	900	agreement specifically provides otherwise, a member or manager
901	901	associated with a series or a member or manager of the company is
902	902	not liable for a debt, obligation, or liability of a series,
903	903	including a debt, obligation, or liability under a judgment,
904	904	decree, or court order.
905	905	(b) The company agreement may expand or restrict any duties,
906	906	including fiduciary duties, and related liabilities that a member,
907	907	manager, officer, or other person associated with a series has to:
908	908	(1) the series or the company;
909	909	(2) a member or manager associated with the series; or
910	910	(3) a member or manager of the company.
911	911	Sec. 101.607. CLASS OR GROUP OF MEMBERS OR MANAGERS.
912	912	(a) The company agreement may:
913	913	(1) establish classes or groups of one or more members
914	914	or managers associated with a series each of which has certain
915	915	express relative rights, powers, and duties, including voting
916	916	rights; and
917	917	(2) provide for the manner of establishing additional
918	918	classes or groups of one or more members or managers associated with
919	919	the series each of which has certain express rights, powers, and
920	920	duties, including providing for voting rights and rights, powers,
921	921	and duties senior to existing classes and groups of members or
922	922	managers associated with the series.
923	923	(b) The company agreement may provide for the taking of an
924	924	action, including the amendment of the company agreement, without
925	925	the vote or approval of any member or manager or class or group of
926	926	members or managers, to create under the provisions of the company
927	927	agreement a class or group of the series of membership interests
928	928	that was not previously outstanding.
929	929	(c) The company agreement may provide that:
930	930	(1) all or certain identified members or managers or a
931	931	specified class or group of the members or managers associated with
932	932	a series have the right to vote on any matter separately or with all
933	933	or any class or group of the members or managers associated with the
934	934	series;
935	935	(2) any member or class or group of members associated
936	936	with a series has no voting rights; and
937	937	(3) voting by members or managers associated with a
938	938	series is on a per capita, number, financial interest, class,
939	939	group, or any other basis.
940	940	Sec. 101.608. GOVERNING AUTHORITY. (a) Notwithstanding
941	941	any conflicting provision of the certificate of formation of a
942	942	limited liability company, the governing authority of a series
943	943	consists of the managers or members associated with the series as
944	944	provided in the company agreement.
945	945	(b) If the company agreement does not provide for the
946	946	governing authority of the series, the governing authority of the
947	947	series consists of:
948	948	(1) the managers associated with the series, if the
949	949	company's certificate of formation states that the company will
950	950	have one or more managers; or
951	951	(2) the members associated with the series, if the
952	952	company's certificate of formation states that the company will not
953	953	have managers.
954	954	Sec. 101.609. APPLICABILITY OF OTHER PROVISIONS OF CHAPTER;
955	955	SYNONYMOUS TERMS. (a) To the extent not inconsistent with this
956	956	subchapter, this chapter applies to a series and its associated
957	957	members and managers.
958	958	(b) For purposes of the application of any other provision
959	959	of this chapter to a provision of this subchapter, and as the
960	960	context requires:
961	961	(1) a reference to "limited liability company" or
962	962	"company" means the "series";
963	963	(2) a reference to "member" means "member associated
964	964	with the series"; and
965	965	(3) a reference to "manager" means "manager associated
966	966	with the series."
967	967	Sec. 101.610. EFFECT OF CERTAIN EVENT ON MANAGER OR MEMBER.
968	968	(a) An event that under this chapter or the company agreement
969	969	causes a manager to cease to be a manager with respect to a series
970	970	does not, in and of itself, cause the manager to cease to be a
971	971	manager of the limited liability company or with respect to any
972	972	other series of the company.
973	973	(b) An event that under this chapter or the company
974	974	agreement causes a member to cease to be associated with a series
975	975	does not, in and of itself, cause the member to cease to be
976	976	associated with any other series or terminate the continued
977	977	membership of a member in the limited liability company or require
978	978	the winding up of the series, regardless of whether the member was
979	979	the last remaining member associated with the series.
980	980	Sec. 101.611. MEMBER STATUS WITH RESPECT TO DISTRIBUTION.
981	981	(a) Subject to Sections 101.613, 101.617, 101.618, 101.619, and
982	982	101.620, when a member associated with a series established under
983	983	this subchapter is entitled to receive a distribution with respect
984	984	to the series, the member, with respect to the distribution, has the
985	985	same status as a creditor of the series and is entitled to any
986	986	remedy available to a creditor of the series.
987	987	(b) Section 101.207 does not apply to a distribution with
988	988	respect to the series.
989	989	Sec. 101.612. RECORD DATE FOR ALLOCATIONS AND
990	990	DISTRIBUTIONS. A company agreement may establish or provide for
991	991	the establishment of a record date for allocations and
992	992	distributions with respect to a series.
993	993	Sec. 101.613. DISTRIBUTIONS. (a) A limited liability
994	994	company may make a distribution with respect to a series.
995	995	(b) A limited liability company may not make a distribution
996	996	with respect to a series to a member if, immediately after making
997	997	the distribution, the total amount of the liabilities of the
998	998	series, other than liabilities described by Subsection (c), exceeds
999	999	the fair value of the assets associated with the series.
1000	1000	(c) For purposes of Subsection (b), the liabilities of a
1001	1001	series do not include:
1002	1002	(1) a liability related to the member's membership
1003	1003	interest; or
1004	1004	(2) except as provided by Subsection (e), a liability
1005	1005	of the series for which the recourse of creditors is limited to
1006	1006	specified property of the series.
1007	1007	(d) For purposes of Subsection (b), the assets associated
1008	1008	with a series include the fair value of property of the series
1009	1009	subject to a liability for which recourse of creditors is limited to
1010	1010	specified property of the series only if the fair value of that
1011	1011	property exceeds the liability.
1012	1012	(e) A member who receives a distribution from a series in
1013	1013	violation of this section is not required to return the
1014	1014	distribution to the series unless the member had knowledge of the
1015	1015	violation.
1016	1016	(f) This section may not be construed to affect the
1017	1017	obligation of a member to return a distribution to the series under
1018	1018	the company agreement or other state or federal law.
1019	1019	(g) Section 101.206 does not apply to a distribution with
1020	1020	respect to a series.
1021	1021	(h) For purposes of this section, "distribution" does not
1022	1022	include an amount constituting reasonable compensation for present
1023	1023	or past services or a reasonable payment made in the ordinary course
1024	1024	of business under a bona fide retirement plan or other benefits
1025	1025	program.
1026	1026	Sec. 101.614. AUTHORITY TO WIND UP AND TERMINATE SERIES.
1027	1027	Except to the extent otherwise provided in the company agreement
1028	1028	and subject to Sections 101.617, 101.618, 101.619, and 101.620, a
1029	1029	series and its business and affairs may be wound up and terminated
1030	1030	without causing the winding up of the limited liability company.
1031	1031	Sec. 101.615. TERMINATION OF SERIES. (a) Except as
1032	1032	otherwise provided by Sections 101.617, 101.618, 101.619, and
1033	1033	101.620, the series terminates on the completion of the winding up
1034	1034	of the business and affairs of the series in accordance with
1035	1035	Sections 101.617, 101.618, 101.619, and 101.620.
1036	1036	(b) The limited liability company shall provide notice of
1037	1037	the termination of a series in the manner provided in the company
1038	1038	agreement for notice of termination, if any.
1039	1039	(c) The termination of the series does not affect the
1040	1040	limitation on liabilities of the series provided by Section
1041	1041	101.602.
1042	1042	Sec. 101.616. EVENT REQUIRING WINDING UP. Subject to
1043	1043	Sections 101.617, 101.618, 101.619, and 101.620, the business and
1044	1044	affairs of a series are required to be wound up:
1045	1045	(1) if the winding up of the limited liability company
1046	1046	is required under Section 101.552(a) or Chapter 11; or
1047	1047	(2) on the earlier of:
1048	1048	(A) the time specified for winding up the series
1049	1049	in the company agreement;
1050	1050	(B) the occurrence of an event specified with
1051	1051	respect to the series in the company agreement;
1052	1052	(C) the occurrence of a majority vote of all of
1053	1053	the members associated with the series approving the winding up of
1054	1054	the series or, if there is more than one class or group of members
1055	1055	associated with the series, a majority vote of the members of each
1056	1056	class or group of members associated with the series approving the
1057	1057	winding up of the series;
1058	1058	(D) if the series has no members, the occurrence
1059	1059	of a majority vote of all of the managers associated with the series
1060	1060	approving the winding up of the series or, if there is more than one
1061	1061	class or group of managers associated with the series, a majority
1062	1062	vote of the managers of each class or group of managers associated
1063	1063	with the series approving the winding up of the series; or
1064	1064	(E) a determination by a court in accordance with
1065	1065	Section 101.621.
1066	1066	Sec. 101.617. PROCEDURES FOR WINDING UP AND TERMINATION OF
1067	1067	SERIES. (a) The following provisions apply to a series and the
1068	1068	associated members and managers of the series:
1069	1069	(1) Subchapters A, G, H, and I, Chapter 11; and
1070	1070	(2) Subchapter B, Chapter 11, other than Sections
1071	1071	11.051, 11.056, 11.057, 11.058, and 11.059.
1072	1072	(b) For purposes of the application of Chapter 11 to a
1073	1073	series and as the context requires:
1074	1074	(1) a reference to "domestic entity," "filing entity,"
1075	1075	or "entity" means the "series";
1076	1076	(2) a reference to an "owner" means a "member
1077	1077	associated with the series";
1078	1078	(3) a reference to the "governing authority" or a
1079	1079	"governing person" means the "governing authority associated with
1080	1080	the series" or a "governing person associated with the series"; and
1081	1081	(4) a reference to "business," "property,"
1082	1082	"obligations," or "liabilities" means the "business associated
1083	1083	with the series," "property associated with the series,"
1084	1084	"obligations associated with the series," or "liabilities
1085	1085	associated with the series."
1086	1086	(c) After the occurrence of an event requiring winding up of
1087	1087	a series under Section 101.616, unless a revocation as provided by
1088	1088	Section 101.618 or a cancellation as provided by Section 101.619
1089	1089	occurs, the winding up of the series must be carried out by:
1090	1090	(1) the governing authority of the series or one or
1091	1091	more persons, including a governing person, designated by:
1092	1092	(A) the governing authority of the series;
1093	1093	(B) the members associated with the series; or
1094	1094	(C) the company agreement; or
1095	1095	(2) a person appointed by the court to carry out the
1096	1096	winding up of the series under Section 11.054, 11.405, 11.409, or
1097	1097	11.410.
1098	1098	(d) An action taken in accordance with this section does not
1099	1099	affect the limitation on liability of members and managers provided
1100	1100	by Section 101.606.
1101	1101	Sec. 101.618. REVOCATION OF VOLUNTARY WINDING UP. Before
1102	1102	the termination of the series takes effect, a voluntary decision to
1103	1103	wind up the series under Section 101.616(2)(C) or (D) may be revoked
1104	1104	by:
1105	1105	(1) a majority vote of all of the members associated
1106	1106	with the series approving the revocation or, if there is more than
1107	1107	one class or group of members associated with the series, a majority
1108	1108	vote of the members of each class or group of members associated
1109	1109	with the series approving the revocation; or
1110	1110	(2) if the series has no members, a majority vote of
1111	1111	all the managers associated with the series approving the
1112	1112	revocation or, if there is more than one class or group of managers
1113	1113	associated with the series, a majority vote of the managers of each
1114	1114	class or group of managers associated with the series approving the
1115	1115	revocation.
1116	1116	Sec. 101.619. CANCELLATION OF EVENT REQUIRING WINDING UP.
1117	1117	(a) Unless the cancellation is prohibited by the company
1118	1118	agreement, an event requiring winding up of the series under
1119	1119	Section 101.616(1) or (2) may be canceled by the consent of all of
1120	1120	the members of the series before the termination of the series takes
1121	1121	effect.
1122	1122	(b) In connection with the cancellation, the members must
1123	1123	amend the company agreement to:
1124	1124	(1) eliminate or extend the time specified for the
1125	1125	series if the event requiring winding up of the series occurred
1126	1126	under Section 101.616(1); or
1127	1127	(2) eliminate or revise the event specified with
1128	1128	respect to the series if the event requiring winding up of the
1129	1129	series occurred under Section 101.616(2).
1130	1130	Sec. 101.620. CONTINUATION OF BUSINESS. The series may
1131	1131	continue its business following the revocation under Section
1132	1132	101.618 or the cancellation under Section 101.619.
1133	1133	Sec. 101.621. WINDING UP BY COURT ORDER. A district court
1134	1134	in the county in which the registered office or principal place of
1135	1135	business in this state of a domestic limited liability company is
1136	1136	located, on application by or for a member associated with the
1137	1137	series, has jurisdiction to order the winding up and termination of
1138	1138	a series if the court determines that it is not reasonably
1139	1139	practicable to carry on the business of the series in conformity
1140	1140	with the company agreement.
1141	1141	SECTION 46. Chapter 151, Business Organizations Code, is
1142	1142	amended by adding Section 151.004 to read as follows:
1143	1143	Sec. 151.004. OFFICERS. A partnership may have elected or
1144	1144	appointed officers in accordance with Section 3.103.
1145	1145	SECTION 47. Subsection (a), Section 152.801, Business
1146	1146	Organizations Code, is amended to read as follows:
1147	1147	(a) Except as provided by Subsection (b) or the partnership
1148	1148	agreement, a partner in a limited liability partnership is not
1149	1149	personally liable to any person, including a partner, directly or
1150	1150	indirectly, by contribution, indemnity, or otherwise, for a debt or
1151	1151	obligation of the partnership incurred while the partnership is a
1152	1152	limited liability partnership.
1153	1153	SECTION 48. Subsection (f), Section 152.802, Business
1154	1154	Organizations Code, is amended to read as follows:
1155	1155	(f) A registration may be withdrawn by filing a withdrawal
1156	1156	notice with the secretary of state in accordance with Chapter 4. A
1157	1157	certificate from the comptroller stating that all taxes
1158	1158	administered by the comptroller under Title 2, Tax Code, have been
1159	1159	paid must be filed with the notice of withdrawal. A withdrawal
1160	1160	notice terminates the status of the partnership as a limited
1161	1161	liability partnership from the date on which the notice is filed or
1162	1162	a later date specified in the notice, but not later than the
1163	1163	expiration date under Subsection (e). A withdrawal notice must:
1164	1164	(1) contain:
1165	1165	(A) the name of the partnership;
1166	1166	(B) the federal tax identification number of the
1167	1167	partnership;
1168	1168	(C) the date of registration of the partnership's
1169	1169	last application under this subchapter; and
1170	1170	(D) the current street address of the
1171	1171	partnership's principal office in this state and outside this
1172	1172	state, if applicable; and
1173	1173	(2) be signed by:
1174	1174	(A) a majority-in-interest of the partners; or
1175	1175	(B) one or more partners authorized by a
1176	1176	majority-in-interest of the partners.
1177	1177	SECTION 49. Section 152.906, Business Organizations Code,
1178	1178	is amended by adding Subsection (c) to read as follows:
1179	1179	(c) A certificate from the comptroller stating that all
1180	1180	taxes administered by the comptroller under Title 2, Tax Code, have
1181	1181	been paid must be filed with the withdrawal of registration.
1182	1182	SECTION 50. Section 152.914, Business Organizations Code,
1183	1183	is amended by adding Subsection (f) to read as follows:
1184	1184	(f) A tax clearance letter from the comptroller stating that
1185	1185	a foreign limited liability partnership has satisfied all franchise
1186	1186	tax liabilities and may be reinstated must be filed with the
1187	1187	certificate of reinstatement if the foreign limited liability
1188	1188	partnership is a taxable entity under Chapter 171, Tax Code.
1189	1189	SECTION 51. Section 153.103, Business Organizations Code,
1190	1190	is amended to read as follows:
1191	1191	Sec. 153.103. ACTIONS NOT CONSTITUTING PARTICIPATION IN
1192	1192	BUSINESS FOR LIABILITY PURPOSES. For purposes of this section and
1193	1193	Sections 153.102, 153.104, and 153.105, a limited partner does not
1194	1194	participate in the control of the business because the limited
1195	1195	partner has or has acted in one or more of the following capacities
1196	1196	or possesses or exercises one or more of the following powers:
1197	1197	(1) acting as:
1198	1198	(A) a contractor for or an officer or other agent
1199	1199	or employee of the limited partnership;
1200	1200	(B) a contractor for or an agent or employee of a
1201	1201	general partner;
1202	1202	(C) an officer, director, or stockholder of a
1203	1203	corporate general partner;
1204	1204	(D) a partner of a partnership that is a general
1205	1205	partner of the limited partnership; or
1206	1206	(E) a member or manager of a limited liability
1207	1207	company that is a general partner of the limited partnership;
1208	1208	(2) acting in a capacity similar to that described in
1209	1209	Subdivision (1) with any other person that is a general partner of
1210	1210	the limited partnership;
1211	1211	(3) consulting with or advising a general partner on
1212	1212	any matter, including the business of the limited partnership;
1213	1213	(4) acting as surety, guarantor, or endorser for the
1214	1214	limited partnership, guaranteeing or assuming one or more specific
1215	1215	obligations of the limited partnership, or providing collateral for
1216	1216	borrowings of the limited partnership;
1217	1217	(5) calling, requesting, attending, or participating
1218	1218	in a meeting of the partners or the limited partners;
1219	1219	(6) winding up the business of a limited partnership
1220	1220	under Chapter 11 and Subchapter K of this chapter;
1221	1221	(7) taking an action required or permitted by law to
1222	1222	bring, pursue, settle, or otherwise terminate a derivative action
1223	1223	in the right of the limited partnership;
1224	1224	(8) serving on a committee of the limited partnership
1225	1225	or the limited partners; or
1226	1226	(9) proposing, approving, or disapproving, by vote or
1227	1227	otherwise, one or more of the following matters:
1228	1228	(A) the winding up or termination of the limited
1229	1229	partnership;
1230	1230	(B) an election to reconstitute the limited
1231	1231	partnership or continue the business of the limited partnership;
1232	1232	(C) the sale, exchange, lease, mortgage,
1233	1233	assignment, pledge, or other transfer of, or granting of a security
1234	1234	interest in, an asset of the limited partnership;
1235	1235	(D) the incurring, renewal, refinancing, or
1236	1236	payment or other discharge of indebtedness by the limited
1237	1237	partnership;
1238	1238	(E) a change in the nature of the business of the
1239	1239	limited partnership;
1240	1240	(F) the admission, removal, or retention of a
1241	1241	general partner;
1242	1242	(G) the admission, removal, or retention of a
1243	1243	limited partner;
1244	1244	(H) a transaction or other matter involving an
1245	1245	actual or potential conflict of interest;
1246	1246	(I) an amendment to the partnership agreement or
1247	1247	certificate of formation;
1248	1248	(J) if the limited partnership is qualified as an
1249	1249	investment company under the federal Investment Company Act of 1940
1250	1250	(15 U.S.C. Section 80a-1 et seq.), as amended, any matter required
1251	1251	by that Act or the rules and regulations of the Securities and
1252	1252	Exchange Commission under that Act, to be approved by the holders of
1253	1253	beneficial interests in an investment company, including:
1254	1254	(i) electing directors or trustees of the
1255	1255	investment company;
1256	1256	(ii) approving or terminating an investment
1257	1257	advisory or underwriting contract;
1258	1258	(iii) approving an auditor; and
1259	1259	(iv) acting on another matter that that Act
1260	1260	requires to be approved by the holders of beneficial interests in
1261	1261	the investment company;
1262	1262	(K) indemnification of a general partner under
1263	1263	Chapter 8 or otherwise;
1264	1264	(L) any other matter stated in the partnership
1265	1265	agreement;
1266	1266	(M) the exercising of a right or power granted or
1267	1267	permitted to limited partners under this code and not specifically
1268	1268	enumerated in this section; or
1269	1269	(N) the merger or conversion of a limited
1270	1270	partnership.
1271	1271	SECTION 52. Section 153.210, Business Organizations Code,
1272	1272	is amended to read as follows:
1273	1273	Sec. 153.210. LIMITATION ON DISTRIBUTION. (a) Unless the
1274	1274	distribution is made in compliance with Chapter 11, a [A] limited
1275	1275	partnership may not make a distribution to a partner if,
1276	1276	immediately after giving effect to the distribution and despite any
1277	1277	compromise of a claim referred to by Sections 153.203 and 153.204,
1278	1278	all liabilities of the limited partnership, other than liabilities
1279	1279	to partners with respect to their partnership interests and
1280	1280	liabilities for which the recourse of creditors is limited to
1281	1281	specified property of the limited partnership, exceed the fair
1282	1282	value of the partnership assets. The fair value of property that is
1283	1283	subject to a liability for which recourse of creditors is limited
1284	1284	shall be included in the partnership assets for purposes of this
1285	1285	subsection only to the extent that the fair value of that property
1286	1286	exceeds that liability.
1287	1287	(b) For purposes of this section, "distribution" does not
1288	1288	include an amount constituting reasonable compensation for present
1289	1289	or past services or a reasonable payment made in the ordinary course
1290	1290	of business under a bona fide retirement plan or other benefits
1291	1291	program.
1292	1292	SECTION 53. Subsection (c), Section 153.256, Business
1293	1293	Organizations Code, is amended to read as follows:
1294	1294	(c) A charging order constitutes a lien on the judgment
1295	1295	debtor's partnership interest. The charging order lien may not be
1296	1296	foreclosed on under this code or any other law.
1297	1297	SECTION 54. Subsection (c), Section 153.309, Business
1298	1298	Organizations Code, is amended to read as follows:
1299	1299	(c) This section and Sections 153.307 and 153.308 do not
1300	1300	affect the liability of a limited partner [to the limited
1301	1301	partnership].
1302	1302	SECTION 55. Section 153.311, Business Organizations Code,
1303	1303	is amended to read as follows:
1304	1304	Sec. 153.311. TERMINATION [CANCELLATION] OF CERTIFICATE OR
1305	1305	REVOCATION OF REGISTRATION AFTER FORFEITURE. (a) The secretary of
1306	1306	state may terminate [cancel] the certificate of formation of a
1307	1307	domestic limited partnership, or revoke the registration of a
1308	1308	foreign limited partnership, if the limited partnership:
1309	1309	(1) forfeits its right to transact business in this
1310	1310	state under Section 153.307; and
1311	1311	(2) fails to revive that right under Section 153.310.
1312	1312	(b) Termination [Cancellation] of the certificate or
1313	1313	revocation of registration takes effect without judicial
1314	1314	ascertainment.
1315	1315	(c) The secretary of state shall note the termination or
1316	1316	revocation [cancellation] and the date [of cancellation] on the
1317	1317	record kept in the secretary's office relating to the limited
1318	1318	partnership.
1319	1319	(d) On termination or revocation [cancellation], the status
1320	1320	of the limited partnership is changed to inactive according to the
1321	1321	records of the secretary of state. The change to inactive status
1322	1322	does not affect the liability of a limited partner [to the limited
1323	1323	partnership].
1324	1324	SECTION 56. Subsections (a) and (b), Section 153.312,
1325	1325	Business Organizations Code, are amended to read as follows:
1326	1326	(a) A limited partnership the certificate of formation or
1327	1327	registration of which has been terminated or revoked [canceled] as
1328	1328	provided by Section 153.311 may be relieved of the termination or
1329	1329	revocation [cancellation] by filing the report required by Section
1330	1330	153.301, accompanied by the filing fees provided by Chapter 4.
1331	1331	(b) If the limited partnership pays the fees required by
1332	1332	Subsection (a) and all taxes, penalties, and interest due and
1333	1333	accruing before termination or revocation, the secretary of state
1334	1334	shall:
1335	1335	(1) reinstate the certificate or registration of the
1336	1336	limited partnership without judicial ascertainment;
1337	1337	(2) change the status of the limited partnership to
1338	1338	active; and
1339	1339	(3) note the reinstatement on the record kept in the
1340	1340	secretary's office relating to the limited partnership.
1341	1341	SECTION 57. Section 154.001, Business Organizations Code,
1342	1342	is amended by adding Subsection (d) to read as follows:
1343	1343	(d) Sections 9.406 and 9.408, Business & Commerce Code, do
1344	1344	not apply to a partnership interest in a partnership, including the
1345	1345	rights, powers, and interests arising under the governing documents
1346	1346	of the partnership or under this code. To the extent of any
1347	1347	conflict between this subsection and Section 9.406 or 9.408,
1348	1348	Business & Commerce Code, this subsection controls. It is the
1349	1349	express intent of this subsection to permit the enforcement, as a
1350	1350	contract among the partners of a partnership, of any provision of a
1351	1351	partnership agreement that would otherwise be ineffective under
1352	1352	Section 9.406 or 9.408, Business & Commerce Code.
1353	1353	SECTION 58. Subsection (b), Section 200.317, Business
1354	1354	Organizations Code, is amended to read as follows:
1355	1355	(b) An otherwise valid contract or transaction described by
1356	1356	Subsection (a) is valid notwithstanding that the [a] trust manager
1357	1357	or officer having the relationship or interest described by
1358	1358	Subsection (a) [of the trust] is present at or participates in the
1359	1359	meeting of the trust managers or of a committee of the trust
1360	1360	managers that authorizes the contract or transaction, or votes or
1361	1361	signs, in the person's capacity as a trust manager or committee
1362	1362	member, a unanimous written consent of trust managers or committee
1363	1363	members to authorize the contract or transaction, if:
1364	1364	(1) the material facts as to the relationship or
1365	1365	interest described by Subsection (a) and as to the contract or
1366	1366	transaction are disclosed to or known by:
1367	1367	(A) the trust managers or a committee of the
1368	1368	trust managers, and the trust managers or committee of the trust
1369	1369	managers in good faith authorize the contract or transaction by the
1370	1370	approval [affirmative vote] of the majority of disinterested trust
1371	1371	managers or committee members, regardless of whether the
1372	1372	disinterested trust managers or committee members constitute a
1373	1373	quorum; or
1374	1374	(B) the shareholders entitled to vote on the
1375	1375	authorization of the contract or transaction, and the contract or
1376	1376	transaction is specifically approved in good faith by a vote of the
1377	1377	shareholders; or
1378	1378	(2) the contract or transaction is fair to the real
1379	1379	estate investment trust when the contract or transaction is
1380	1380	authorized, approved, or ratified by the trust managers, a
1381	1381	committee of the trust managers, or the shareholders.
1382	1382	SECTION 59. Subsection (a), Section 402.005, Business
1383	1383	Organizations Code, is amended to read as follows:
1384	1384	(a) On or after January 1, 2010, if a domestic entity formed
1385	1385	before January 1, 2006, or a foreign filing entity registered with
1386	1386	the secretary of state to transact business in this state before
1387	1387	January 1, 2006, has not taken the actions specified by Section
1388	1388	402.003 [402.003(a)] or 402.004 to elect to adopt this code:
1389	1389	(1) this code applies to the entity and all actions
1390	1390	taken by the managerial officials, owners, or members of the
1391	1391	entity, except as otherwise expressly provided by this title;
1392	1392	(2) if the entity is a domestic or foreign filing
1393	1393	entity, the entity is not considered to have failed to comply with
1394	1394	this code if the entity's certificate of formation or application
1395	1395	for registration, as appropriate, does not comply with this code;
1396	1396	(3) if the entity is a domestic filing entity, the
1397	1397	entity shall conform its certificate of formation to the
1398	1398	requirements of this code when it next files an amendment to its
1399	1399	certificate of formation; and
1400	1400	(4) if the entity is a foreign filing entity, the
1401	1401	entity shall conform its application for registration to the
1402	1402	requirements of this code when it next files an amendment to its
1403	1403	application for registration.
1404	1404	SECTION 60. Section 9.406, Business & Commerce Code, is
1405	1405	amended by adding Subsection (j) to read as follows:
1406	1406	(j) This section does not apply to an interest in a
1407	1407	partnership or limited liability company.
1408	1408	SECTION 61. Section 9.408, Business & Commerce Code, is
1409	1409	amended by adding Subsection (e) to read as follows:
1410	1410	(e) This section does not apply to an interest in a
1411	1411	partnership or limited liability company.
1412	1412	SECTION 62. Section 71.002, Business & Commerce Code, is
1413	1413	amended by amending Subdivisions (2), (4), (7), (8), and (9) and
1414	1414	adding Subdivision (6-a) to read as follows:
1415	1415	(2) "Assumed name" means:
1416	1416	(A) for an individual, a name that does not
1417	1417	include the surname of the individual;
1418	1418	(B) for a partnership, a name that does not
1419	1419	include the surname or other legal name of each joint venturer or
1420	1420	general partner;
1421	1421	(C) for an individual or a partnership, a name,
1422	1422	including a surname, that suggests the existence of additional
1423	1423	owners by including words such as "Company," "& Company," "& Son,"
1424	1424	"& Sons," "& Associates," "Brothers," and similar words, but not
1425	1425	words that merely describe the business being conducted or the
1426	1426	professional service being rendered;
1427	1427	(D) for a limited partnership, a name other than
1428	1428	the name stated in its certificate of formation;
1429	1429	(E) for a company, a name used by the company;
1430	1430	(F) for a corporation, a name other than the name
1431	1431	stated in its certificate of formation or a comparable document;
1432	1432	(G) for a [registered] limited liability
1433	1433	partnership, a name other than the name stated in its application
1434	1434	filed with the office of the secretary of state or a comparable
1435	1435	document; and
1436	1436	(H) for a limited liability company, a name other
1437	1437	than the name stated in its certificate of formation or a comparable
1438	1438	document.
1439	1439	(4) "Company" means a real estate investment trust, a
1440	1440	joint-stock company, or any other business, professional, or other
1441	1441	association or legal entity that is not incorporated, other than a
1442	1442	partnership, limited partnership, limited liability company, [or
1443	1443	registered] limited liability partnership, or foreign filing
1444	1444	entity.
1445	1445	(6-a) "Foreign filing entity" means an entity formed
1446	1446	under the laws of a jurisdiction other than this state that
1447	1447	registers or is required by law to register with the secretary of
1448	1448	state to conduct business or render professional services in this
1449	1449	state under Chapter 9, Business Organizations Code.
1450	1450	(7) "Office" means:
1451	1451	(A) for a person that is not an individual or that
1452	1452	is a corporation that is not required to or does not maintain a
1453	1453	registered office in this state, the person's:
1454	1454	(i) principal office; and
1455	1455	(ii) principal place of business if not the
1456	1456	same as the person's principal office; and
1457	1457	(B) for a corporation, limited partnership,
1458	1458	[registered] limited liability partnership, [or] limited liability
1459	1459	company, or foreign filing entity that is required to maintain a
1460	1460	registered office in this state, the entity's:
1461	1461	(i) registered office; and
1462	1462	(ii) principal office if not the same as the
1463	1463	entity's registered office.
1464	1464	(8) "Partnership" means a joint venture or general
1465	1465	partnership other than a limited partnership or a [registered]
1466	1466	limited liability partnership.
1467	1467	(9) "Person" includes an individual, partnership,
1468	1468	limited partnership, limited liability company, [registered]
1469	1469	limited liability partnership, company, [or] corporation, or
1470	1470	foreign filing entity.
1471	1471	SECTION 63. Subsection (b), Section 71.003, Business &
1472	1472	Commerce Code, is amended to read as follows:
1473	1473	(b) This chapter does not require a corporation, limited
1474	1474	partnership, [registered] limited liability partnership, [or]
1475	1475	limited liability company, or foreign filing entity or its
1476	1476	shareholders, associates, partners, or members to file a
1477	1477	certificate to conduct business or render a professional service in
1478	1478	this state under the name of the entity as stated in the certificate
1479	1479	of formation, application filed with the office of the secretary of
1480	1480	state, or other comparable document of the entity.
1481	1481	SECTION 64. Section 71.051, Business & Commerce Code, is
1482	1482	amended to read as follows:
1483	1483	Sec. 71.051. CERTIFICATE FOR CERTAIN UNINCORPORATED
1484	1484	PERSONS. A person must file a certificate under this subchapter if
1485	1485	the person regularly conducts business or renders a professional
1486	1486	service in this state under an assumed name other than as a
1487	1487	corporation, limited partnership, [registered] limited liability
1488	1488	partnership, [or] limited liability company, or foreign filing
1489	1489	entity.
1490	1490	SECTION 65. Section 71.052, Business & Commerce Code, is
1491	1491	amended to read as follows:
1492	1492	Sec. 71.052. CONTENTS OF CERTIFICATE. The certificate must
1493	1493	state:
1494	1494	(1) the assumed name under which the business is or is
1495	1495	to be conducted or the professional service is or is to be rendered;
1496	1496	(2) if the registrant is:
1497	1497	(A) an individual, the individual's full name and
1498	1498	residence address;
1499	1499	(B) a partnership:
1500	1500	(i) the venture or partnership name;
1501	1501	(ii) the venture or partnership office
1502	1502	address;
1503	1503	(iii) the full name of each joint venturer
1504	1504	or general partner; and
1505	1505	(iv) each joint venturer's or general
1506	1506	partner's residence address if the venturer or partner is an
1507	1507	individual or the joint venturer's or general partner's office
1508	1508	address if the venturer or partner is not an individual;
1509	1509	(C) an estate:
1510	1510	(i) the name of the estate;
1511	1511	(ii) the estate's office address, if any;
1512	1512	(iii) the full name of each representative
1513	1513	of the estate; and
1514	1514	(iv) each representative's residence
1515	1515	address if the representative is an individual or the
1516	1516	representative's office address if the representative is not an
1517	1517	individual;
1518	1518	(D) a real estate investment trust:
1519	1519	(i) the name of the trust;
1520	1520	(ii) the address of the trust;
1521	1521	(iii) the full name of each trustee
1522	1522	manager; and
1523	1523	(iv) each trustee manager's residence
1524	1524	address if the trustee manager is an individual or the trustee
1525	1525	manager's office address if the trustee manager is not an
1526	1526	individual; or
1527	1527	(E) a company, other than a real estate
1528	1528	investment trust[, or a corporation]:
1529	1529	(i) the name of the company [or
1530	1530	corporation];
1531	1531	(ii) the state, country, or other
1532	1532	jurisdiction under the laws of which the company [or corporation]
1533	1533	was organized [or incorporated]; and
1534	1534	(iii) the company's [or corporation's]
1535	1535	office address;
1536	1536	(3) the period, not to exceed 10 years, during which
1537	1537	the registrant will use the assumed name; and
1538	1538	(4) a statement specifying that the business that is
1539	1539	or will be conducted or the professional service that is or will be
1540	1540	rendered in the county under the assumed name is being or will be
1541	1541	conducted or rendered as a proprietorship, sole practitioner,
1542	1542	partnership, real estate investment trust, joint-stock company, or
1543	1543	other form of unincorporated business or professional association
1544	1544	or entity other than a limited partnership, limited liability
1545	1545	company, [or registered] limited liability partnership, or foreign
1546	1546	filing entity.
1547	1547	SECTION 66. Section 71.101, Business & Commerce Code, is
1548	1548	amended to read as follows:
1549	1549	Sec. 71.101. CERTIFICATE FOR INCORPORATED BUSINESS OR
1550	1550	PROFESSION, LIMITED PARTNERSHIP, [REGISTERED] LIMITED LIABILITY
1551	1551	PARTNERSHIP, [OR] LIMITED LIABILITY COMPANY, OR FOREIGN FILING
1552	1552	ENTITY. A corporation, limited partnership, [registered] limited
1553	1553	liability partnership, [or] limited liability company, or foreign
1554	1554	filing entity must file a certificate under this subchapter if the
1555	1555	entity:
1556	1556	(1) regularly conducts business or renders
1557	1557	professional services in this state under an assumed name; or
1558	1558	(2) is required by law to use an assumed name in this
1559	1559	state to conduct business or render professional services.
1560	1560	SECTION 67. Section 71.102, Business & Commerce Code, is
1561	1561	amended to read as follows:
1562	1562	Sec. 71.102. CONTENTS OF CERTIFICATE. The certificate must
1563	1563	state:
1564	1564	(1) the assumed name under which the business is or is
1565	1565	to be conducted or the professional service is or is to be rendered;
1566	1566	(2) the registrant's name as stated in the
1567	1567	registrant's certificate of formation or application filed with the
1568	1568	office of the secretary of state or other comparable document;
1569	1569	(3) the state, country, or other jurisdiction under
1570	1570	the laws of which the registrant was incorporated or organized and
1571	1571	the registrant's registered or similar office address in that
1572	1572	state, country, or jurisdiction;
1573	1573	(4) the period, not to exceed 10 years, during which
1574	1574	the registrant will use the assumed name;
1575	1575	(5) a statement specifying that the registrant is:
1576	1576	(A) a for-profit [business] corporation,
1577	1577	nonprofit corporation, professional corporation, professional
1578	1578	association, or other type of corporation;
1579	1579	(B) a limited partnership, [registered] limited
1580	1580	liability partnership, or limited liability company; or
1581	1581	(C) another type of incorporated business,
1582	1582	professional or other association, or legal entity, foreign or
1583	1583	domestic;
1584	1584	(6) the address of:
1585	1585	(A) the registrant's[:
1586	1586	[(i) registered office in this state and
1587	1587	the name of its registered agent at that address; and
1588	1588	[(ii)] principal office[, if the principal
1589	1589	office address is not the same as the registrant's registered
1590	1590	office address in this state]; or
1591	1591	(B) if the registrant is not required to or does
1592	1592	not maintain a registered office in this state:
1593	1593	(i) the registrant's office in this state;
1594	1594	and
1595	1595	(ii) the registrant's place of business in
1596	1596	this state and any office of the registrant outside this state, if
1597	1597	the registrant is not incorporated or organized under the laws of
1598	1598	this state; and
1599	1599	(7) the county or counties in this state where the
1600	1600	registrant is or will be conducting business or rendering
1601	1601	professional services under the assumed name.
1602	1602	SECTION 68. Section 71.103, Business & Commerce Code, is
1603	1603	amended to read as follows:
1604	1604	Sec. 71.103. PLACE OF FILING. (a) The corporation,
1605	1605	limited partnership, [registered] limited liability partnership,
1606	1606	[or] limited liability company, or foreign filing entity shall file
1607	1607	the certificate in the office of the secretary of state and in the
1608	1608	office or offices of each county clerk as specified by Subsection
1609	1609	(b) or (c).
1610	1610	(b) An [Except as provided by Subsection (c), the] entity
1611	1611	that maintains a registered office in this state shall file the
1612	1612	certificate in the office [offices] of the county clerk of the
1613	1613	county in which the entity's:
1614	1614	(1) registered office is located, if the entity's
1615	1615	principal office is not located in this state; or [and]
1616	1616	(2) principal office is located, if the entity's
1617	1617	principal office is located in this state [and not in the same
1618	1618	county where the registered office is located].
1619	1619	(c) An [If the] entity that [is not required to or] does not
1620	1620	maintain a registered office in this state[, the entity] shall file
1621	1621	the certificate:
1622	1622	(1) in the office of the county clerk of the county in
1623	1623	which the entity's office in this state is located; or
1624	1624	(2) in the office of the county clerk of the county in
1625	1625	which the entity's principal place of business in this state is
1626	1626	located, if:
1627	1627	(A) the entity is not incorporated or organized
1628	1628	under the laws of this state; and
1629	1629	(B) the county in which the entity's principal
1630	1630	place of business in this state is located is not the same county
1631	1631	where the entity's office is located.
1632	1632	SECTION 69. Subsection (b), Section 71.152, Business &
1633	1633	Commerce Code, is amended to read as follows:
1634	1634	(b) An event that causes the information in a certificate to
1635	1635	become materially misleading includes:
1636	1636	(1) a change in the name, identity, entity, form of
1637	1637	business or professional organization, or location of a registrant;
1638	1638	(2) for a proprietorship or sole practitioner, a
1639	1639	change in ownership; or
1640	1640	(3) for a partnership:
1641	1641	(A) the admission of a new partner or joint
1642	1642	venturer; or
1643	1643	(B) the end of a general partner's or joint
1644	1644	venturer's association with the partnership[; or
1645	1645	[(4) for a registrant required by law to maintain a
1646	1646	registered office or similar office and a registered agent or
1647	1647	similar agent at that office, a change in the address of the office
1648	1648	or in the identity of the agent].
1649	1649	SECTION 70. Section 681.170, Business & Commerce Code, is
1650	1650	amended to read as follows:
1651	1651	Sec. 681.170. CITY OF MIDLOTHIAN [TRADE ZONE CORPORATION].
1652	1652	The City of Midlothian [Trade Zone Corporation, organized under the
1653	1653	laws of this state,] may apply for and accept a grant of authority
1654	1654	to establish, operate, and maintain:
1655	1655	(1) a foreign trade zone in Midlothian, Ellis County,
1656	1656	adjacent to the port limits of the Dallas-Fort Worth port of entry;
1657	1657	and
1658	1658	(2) other subzones in Ellis County.
1659	1659	SECTION 71. Subsection (A), Section 19, Texas Professional
1660	1660	Association Act (Article 1528f, Vernon's Texas Civil Statutes), is
1661	1661	amended to read as follows:
1662	1662	(A) The original and a copy of the articles of dissolution
1663	1663	shall be delivered to the Secretary of State, together with a
1664	1664	certificate from the comptroller stating that all taxes
1665	1665	administered by the comptroller under Title 2, Tax Code, have been
1666	1666	paid. If the Secretary of State finds that the articles of
1667	1667	dissolution conform to law, he shall, when all fees have been paid
1668	1668	as required by law:
1669	1669	(1) Endorse on the original and the copy the word
1670	1670	"Filed," and the month, day, and year of the filing thereof.
1671	1671	(2) File the original in his office.
1672	1672	(3) Issue a certificate of dissolution to which he
1673	1673	shall affix the copy.
1674	1674	SECTION 72. Subsection (a), Section 2.03, Texas Revised
1675	1675	Limited Partnership Act (Article 6132a-1, Vernon's Texas Civil
1676	1676	Statutes), is amended to read as follows:
1677	1677	(a) A certificate of limited partnership shall be canceled
1678	1678	by paying the filing fee and filing a certificate of cancellation,
1679	1679	together with a certificate from the comptroller stating that all
1680	1680	taxes administered by the comptroller under Title 2, Tax Code, have
1681	1681	been paid, with the secretary of state:
1682	1682	(1) on the completion of the winding up of the
1683	1683	partnership;
1684	1684	(2) when there are no limited partners; or
1685	1685	(3) subject to Subsection (c) of this section, on a
1686	1686	merger or conversion as provided by Subsection (b) of Section 2.11
1687	1687	of this Act or Subsection (c) of Section 2.15 of this Act.
1688	1688	SECTION 73. Section 9.06, Texas Revised Limited Partnership
1689	1689	Act (Article 6132a-1, Vernon's Texas Civil Statutes), is amended to
1690	1690	read as follows:
1691	1691	Sec. 9.06. CANCELLATION OF REGISTRATION. A foreign limited
1692	1692	partnership may cancel its registration by paying the application
1693	1693	fee and filing with the secretary of state a certificate of
1694	1694	cancellation executed by a general partner, conforming to the
1695	1695	requirements of Section 2.03 of this Act as if it were a domestic
1696	1696	limited partnership, together with a certificate from the
1697	1697	comptroller stating that all taxes administered by the comptroller
1698	1698	under Title 2, Tax Code, have been paid. A cancellation does not
1699	1699	terminate the authority of the secretary of state to accept service
1700	1700	of process on the foreign limited partnership with respect to
1701	1701	causes of action arising out of the transaction of business in
1702	1702	Texas.
1703	1703	SECTION 74. Section 2.006, Business Organizations Code, is
1704	1704	repealed.
1705	1705	SECTION 75. This Act takes effect September 1, 2009.
1706	1706	______________________________ ______________________________
1707	1707	President of the Senate Speaker of the House
1708	1708	I hereby certify that S.B. No. 1442 passed the Senate on
1709	1709	April 9, 2009, by the following vote: Yeas 31, Nays 0; and that the
1710	1710	Senate concurred in House amendment on May 11, 2009, by the
1711	1711	following vote: Yeas 31, Nays 0.
1712	1712	______________________________
1713	1713	Secretary of the Senate
1714	1714	I hereby certify that S.B. No. 1442 passed the House, with
1715	1715	amendment, on May 4, 2009, by the following vote: Yeas 143, Nays 0,
1716	1716	one present not voting.
1717	1717	______________________________
1718	1718	Chief Clerk of the House
1719	1719	Approved:
1720	1720	______________________________
1721	1721	Date
1722	1722	______________________________
1723	1723	Governor