By: Hancock S.B. No. 1518
 
  (Oliveira)
 
   
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to corporations, associations, real estate investment
  trusts, and related entities; authorizing fees.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 4.152, Business Organizations Code, is
  amended to read as follows:
         Sec. 4.152.  FILING FEES:  FOR-PROFIT CORPORATIONS. For a
  filing by or for a for-profit corporation, the secretary of state
  shall impose the following fees:
               (1)  for filing a certificate of formation, $300;
               (2)  for filing a certificate of amendment, $150;
               (3)  for filing an application of a foreign corporation
  for registration to transact business in this state, $750;
               (4)  for filing an application of a foreign corporation
  for an amended registration to transact business in this state,
  $150;
               (5)  for filing a restated certificate of formation and
  accompanying statement, $300;
               (6)  for filing a statement of change of registered
  office, registered agent, or both, $15;
               (7)  for filing a statement of change of name or address
  of a registered agent, $15, except that the maximum fee for
  simultaneous filings by a registered agent for more than one
  corporation may not exceed $750;
               (8)  for filing a statement of resolution establishing
  one or more series of shares, $15;
               (9)  for filing a certificate of termination, $40;
               (10)  for filing a certificate of withdrawal of a
  foreign corporation, $15;
               (11)  for filing a certificate from the home state of a
  foreign corporation that the corporation no longer exists in that
  state, $15;
               (12)  for filing a bylaw or agreement restricting
  transfer of shares or securities other than as an amendment to the
  certificate of formation, $15;
               (13)  for filing an application for reinstatement of a
  certificate of formation or registration as a foreign corporation
  following forfeiture under the Tax Code, $75;
               (14)  for filing an application for reinstatement of a
  corporation or registration as a foreign corporation after
  involuntary termination or revocation, $75; [and]
               (15)  for filing a certificate of validation, $15, plus
  the filing fee imposed for filing each new filing instrument that is
  attached as an exhibit to the certificate of validation under
  Section 21.908(b)(3)(C); and
               (16)  for filing any instrument as provided by this
  code for which this section does not expressly provide a fee, $15.
         SECTION 2.  Section 4.159, Business Organizations Code, is
  amended to read as follows:
         Sec. 4.159.  FILING FEES: NONPROFIT ASSOCIATIONS. For a
  filing by or for a nonprofit association, the secretary of state
  shall impose the following fees:
               (1)  for filing a statement appointing an agent to
  receive service of process, $25;
               (2)  for filing an amendment of a statement appointing
  an agent, $5; [and]
               (3)  for filing a cancellation of a statement
  appointing an agent, $5;
               (4)  for filing a certificate of merger or conversion,
  regardless of whether the surviving or new nonprofit organization
  is a domestic or foreign entity, $50; and
               (5)  for filing any instrument of a nonprofit
  association as provided by this code for which this section does not
  expressly provide a fee, $5.
         SECTION 3.  Subchapter D, Chapter 6, Business Organizations
  Code, is amended by adding Section 6.157 to read as follows:
         Sec. 6.157.  VOTING OF JOINTLY HELD OWNERSHIP INTERESTS.
  (a)  In this section, "jointly held ownership interest" means:
               (1)  an ownership interest that is held of record in the
  names of two or more persons, whether fiduciaries, joint tenants,
  tenants in common, or otherwise; or
               (2)  an ownership interest for which two or more
  persons have the right to vote the interest under Section 6.154.
         (b)  A jointly held ownership interest may be voted by:
               (1)  for a jointly held ownership interest as defined
  by Subsection (a)(1), any one of the record owners; or
               (2)  for a jointly held ownership interest as defined
  by Subsection (a)(2), any one of the persons having the right to
  vote the interest, as described by Section 6.154.
         (c)  If a jointly held ownership interest is voted by more
  than one person as described by Subsection (b), the act of a
  majority of the persons voting binds all of the record owners or
  persons having the right to vote the interest.
         (d)  If a jointly held ownership interest is voted by more
  than one person as described by Subsection (b), and the votes of the
  persons are evenly split on any particular matter, each faction may
  vote the interest proportionately.
         (e)  Subsection (b), (c), or (d) does not apply if the
  secretary or other person tabulating votes on the entity's behalf
  has a good faith belief, based on written information the person
  received regarding rights or obligations with respect to voting the
  jointly held ownership interest, that reliance on Subsection (b),
  (c), or (d), as applicable, is unwarranted.
         SECTION 4.  Section 10.010, Business Organizations Code, is
  amended to read as follows:
         Sec. 10.010.  SPECIAL PROVISIONS APPLYING TO NONPROFIT
  CORPORATION AND NONPROFIT ASSOCIATION MERGERS. (a)  A domestic
  nonprofit corporation or nonprofit association may not merge into
  another entity if the domestic nonprofit corporation or nonprofit
  association would, because of the merger, lose or impair its
  charitable status.
         (b)  One or more domestic or foreign for-profit entities or
  non-code organizations may merge into one or more domestic
  nonprofit corporations or nonprofit associations that continue as
  the surviving entity or entities.
         (c)  A domestic nonprofit corporation or nonprofit
  association may not merge with a foreign for-profit entity if the
  domestic nonprofit corporation or nonprofit association does not
  continue as the surviving entity.
         (d)  One or more domestic nonprofit corporations or
  nonprofit associations and non-code organizations may merge into
  one or more foreign nonprofit entities that continue as the
  surviving entity or entities.
         SECTION 5.  Section 10.108, Business Organizations Code, is
  amended to read as follows:
         Sec. 10.108.  SPECIAL PROVISIONS APPLYING TO NONPROFIT
  CORPORATION AND NONPROFIT ASSOCIATION CONVERSIONS. A domestic
  nonprofit corporation or nonprofit association may not convert into
  a for-profit entity.
         SECTION 6.  Section 21.157, Business Organizations Code, is
  amended by adding Subsection (d) to read as follows:
         (d)  The authorization by the board of directors for the
  issuance of shares may provide that any shares to be issued under
  the authorization may be issued:
               (1)  in one or more transactions in the numbers and at
  the times as stated in or determined by the authorization; or
               (2)  in the manner stated in the authorization, which
  may include a determination or action by any person or persons,
  including the corporation, if the authorization states:
                     (A)  the maximum number of shares that may be
  issued under the authorization;
                     (B)  the period during which the shares may be
  issued; and
                     (C)  the minimum amount of consideration for which
  the shares may be issued.
         SECTION 7.  Section 21.160(d), Business Organizations Code,
  is amended to read as follows:
         (d)  The amount of the consideration to be received for
  shares may be determined in accordance with Subsection (a) by the
  approval of a minimum amount of consideration or a formula to
  determine that amount. The formula may include or be made dependent
  on facts ascertainable outside the formula, if the manner in which
  those facts operate on the formula is clearly or expressly set forth
  in the formula or in the authorization approving the formula.
         SECTION 8.  Section 21.168(c), Business Organizations Code,
  is amended to read as follows:
         (c)  Subject to the certificate of formation, a right or
  option described by this section must state the terms on which, the
  time within which, and any consideration, including a formula by
  which the consideration may be determined, for which the shares may
  be purchased or received from the corporation on the exercise of the
  right or option. A formula by which the consideration may be
  determined may include or be made dependent on facts ascertainable
  outside the formula, if the manner in which those facts operate on
  the formula is clearly or expressly set forth in the formula or in
  the authorization approving the formula.
         SECTION 9.  Section 21.218(b), Business Organizations Code,
  is amended to read as follows:
         (b)  On [Subject to the governing documents and on] written
  demand stating a proper purpose, a holder of shares of a corporation
  for at least six months immediately preceding the holder's demand,
  or a holder of at least five percent of all of the outstanding
  shares of a corporation, is entitled to examine and copy, at a
  reasonable time, the corporation's [relevant] books, records of
  account, minutes, and share transfer records relating to the stated
  purpose. The examination may be conducted in person or through an
  agent, accountant, or attorney.
         SECTION 10.  Section 21.302, Business Organizations Code, is
  amended to read as follows:
         Sec. 21.302.  AUTHORITY FOR DISTRIBUTIONS. (a)  The board
  of directors of a corporation may authorize a distribution and the
  corporation may make a distribution, subject to Section 21.303.
         (b)  The board of directors may authorize a distribution by
  determining the maximum amount that may be distributed and the
  period during which the maximum amount may be distributed,
  including by setting a formula to determine the amount to be
  distributed. The authorization by the board of directors for a
  distribution may provide that the distribution be paid:
               (1)  in the amounts and at the times as stated in the
  authorization; or
               (2)  in the manner stated in the authorization, which
  may include a determination or action by any person or persons,
  including the corporation, if the authorization states the maximum
  amount that may be distributed under the authorization and the
  period during which the maximum amount may be distributed.
         SECTION 11.  Section 21.414, Business Organizations Code, is
  amended to read as follows:
         Sec. 21.414.  DISSENT TO OR ABSTENTION FROM ACTION.  (a)  A
  director of a corporation who is present at a meeting of the board
  of directors at which action has been taken is presumed to have
  assented to the action taken unless:
               (1)  the director's dissent or abstention has been
  entered in the minutes of the meeting;
               (2)  the director has filed a written dissent or
  abstention with respect to the action with the person acting as the
  secretary of the meeting before the meeting is adjourned; or
               (3)  the director has sent [a written dissent by
  registered mail] to the secretary of the corporation, within a
  reasonable time [immediately] after the meeting has been adjourned,
  a written dissent or abstention by:
                     (A)  certified or registered mail, return receipt
  requested; or
                     (B)  other means specified in the corporation's
  governing documents.
         (b)  A director who voted in favor of an action may not
  dissent or abstain with respect to the action.
         SECTION 12.  Section 21.458(a), Business Organizations
  Code, is amended to read as follows:
         (a)  Separate voting by a class or series of shares of a
  corporation is required for approval of a plan of merger or
  conversion if:
               (1)  that class or series of shares is, under the plan
  of merger or conversion, to be converted into or exchanged for other
  securities, interests, obligations, rights to acquire shares,
  interests, or other securities, cash, property, or any combination
  of the items described by this subdivision;
               (2)  the plan of merger or conversion contains a
  provision that would require approval by that class or series of
  shares under Section 21.364 if the provision was contained in a
  proposed amendment to the corporation's certificate of formation;
  or
               (3) [(2)]  that class or series of shares is entitled
  under the certificate of formation to vote as a class or series on
  the plan of merger or conversion.
         SECTION 13.  Section 21.607, Business Organizations Code, is
  amended to read as follows:
         Sec. 21.607.  APPLICATION OF MORATORIUM. Section 21.606
  does not apply to:
               (1)  a business combination of an issuing public
  corporation if:
                     (A)  the original articles of incorporation or
  certificate of formation, as applicable, or the original bylaws of
  the corporation contain a provision expressly electing not to be
  governed by this subchapter;
                     (B)  before December 31, 1997, the corporation
  adopted an amendment to the articles of incorporation or bylaws of
  the corporation expressly electing not to be governed by this
  subchapter; or
                     (C)  after December 31, 1997, the corporation
  adopts an amendment to the articles of incorporation or certificate
  of formation, as applicable, or the bylaws of the corporation,
  approved by the affirmative vote of the holders, other than an
  affiliated shareholder or an affiliate or associate of the
  affiliated shareholder, of at least two-thirds of the outstanding
  voting shares of the issuing public corporation, expressly electing
  not to be governed by this subchapter, except that the amendment to
  the articles of incorporation or certificate of formation, as
  applicable, or the bylaws takes effect 18 months after the date of
  the vote and does not apply to a business combination of the issuing
  public corporation with an affiliated shareholder whose share
  acquisition date is on or before the effective date of the
  amendment;
               (2)  a business combination of an issuing public
  corporation with an affiliated shareholder who became an affiliated
  shareholder inadvertently, if the affiliated shareholder:
                     (A)  as soon as practicable divests itself of a
  sufficient number of the voting shares of the issuing public
  corporation so that the affiliated shareholder no longer is the
  beneficial owner, directly or indirectly, of 20 percent or more of
  the outstanding voting shares of the issuing public corporation;
  and
                     (B)  would not at any time within the three-year
  period preceding the announcement date of the business combination
  have been an affiliated shareholder except for the inadvertent
  acquisition;
               (3)  a business combination with an affiliated
  shareholder who was the beneficial owner of 20 percent or more of
  the outstanding voting shares of the issuing public corporation on
  December 31, 1996, and continuously until the announcement date of
  the business combination;
               (4)  a business combination with an affiliated
  shareholder who became an affiliated shareholder through a transfer
  of shares of the issuing public corporation by will or intestate
  succession and continuously was an affiliated shareholder until the
  announcement date of the business combination; or
               (5)  a business combination of an issuing public
  corporation with a domestic wholly owned subsidiary if the domestic
  subsidiary is not an affiliate or associate of the affiliated
  shareholder for a reason other than the affiliated shareholder's
  beneficial ownership of voting shares in the issuing public
  corporation.
         SECTION 14.  Section 21.729(c), Business Organizations
  Code, is amended to read as follows:
         (c)  The dissent of a shareholder may be proven by:
               (1)  an entry in the minutes of the meeting of
  shareholders;
               (2)  a written dissent filed with the secretary of the
  meeting before the adjournment of the meeting;
               (3)  a written dissent that is sent [by registered
  mail] to the secretary of the close corporation:
                     (A)  promptly after the meeting or after a written
  consent was obtained from the other shareholders; and
                     (B)  by certified or registered mail, return
  receipt requested, or by other means specified in the corporation's
  governing documents; or
               (4)  any other means reasonably evidencing the dissent.
         SECTION 15.  Sections 21.901(4), (5), and (8), Business
  Organizations Code, are amended to read as follows:
               (4)  "Failure of authorization" means:
                     (A)  the failure to authorize or effect an act or
  transaction in compliance with the provisions of the corporate
  statute, the governing documents of the corporation, or any plan or
  agreement to which the corporation is a party, if and to the extent
  the failure would render the act or transaction void or voidable; or
                     (B)  the failure of the board of directors or an
  officer of the corporation to authorize or approve an act or
  transaction taken by or on behalf of the corporation that required
  the prior authorization or approval of the board of directors or the
  officer.
               (5)  "Overissue" means the purported issuance of:
                     (A)  shares of a class or series in excess of the
  number of shares of that class or series that the corporation has
  the power to issue under the governing documents of the corporation
  and the corporate statute at the time of issuance; or
                     (B)  shares of any class or series that are not at
  the time of issuance authorized for issuance by the governing
  documents of the corporation.
               (8)  "Validation effective time" or "effective time of
  the validation," with respect to any defective corporate act
  ratified under this subchapter, means the latest [later] of:
                     (A)  the time at which the defective corporate act
  [resolution] submitted to the shareholders for approval [adoption]
  under Section 21.905 is approved [adopted] by the shareholders or,
  if no shareholder approval is required [for adoption], the time at
  which the board of directors adopts the resolutions [notice]
  required by Section 21.903 [21.911 is given]; [or]
                     (B)  if a certificate of validation is not
  required to be filed under Section 21.908, the time, if any,
  specified by the board of directors in the resolutions adopted
  under Section 21.903, which may not precede the time at which the
  resolutions are adopted; or
                     (C)  the time at which any certificate of
  validation filed under Section 21.908 takes effect in accordance
  with Chapter 4.
         SECTION 16.  Section 21.903, Business Organizations Code, is
  amended to read as follows:
         Sec. 21.903.  RATIFICATION OF DEFECTIVE CORPORATE ACT;
  ADOPTION OF RESOLUTIONS [RESOLUTION]. (a)  To ratify one or more
  [a] defective corporate acts [act], the board of directors of the
  corporation shall adopt resolutions [a resolution] stating:
               (1)  the defective corporate act or acts to be
  ratified;
               (2)  the date [time] of each [the] defective corporate
  act;
               (3)  if the defective corporate act or acts involved
  the issuance of putative shares, the number and type of putative
  shares issued and the date or dates on which the putative shares
  were purportedly issued;
               (4)  the nature of the failure of authorization with
  respect to each [the] defective corporate act to be ratified; and
               (5)  that the board of directors approves the
  ratification of the defective corporate act or acts.
         (b)  A [The] resolution may also state that, notwithstanding
  shareholder approval of the ratification of a defective corporate
  act that is a subject of the resolution [the adoption of the
  resolution by the shareholders], the board of directors may, with
  respect to the defective corporate act [at any time before the
  validation effective time], abandon the ratification of the
  defective corporate act at any time before the validation effective
  time [resolution] without further shareholder action.
         SECTION 17.  Section 21.904, Business Organizations Code, is
  amended to read as follows:
         Sec. 21.904.  QUORUM AND VOTING REQUIREMENTS FOR ADOPTION OF
  RESOLUTIONS [RESOLUTION]. (a)  The quorum and voting requirements
  applicable to the adoption of the resolutions to ratify a defective
  corporate act [a resolution] under Section 21.903 are the same as
  the quorum and voting requirements applicable at the time of the
  adoption of the resolutions [a resolution] for the type of
  defective corporate act proposed to be ratified.
         (b)  Notwithstanding Subsection (a) and except as provided
  by Subsection (c), if in order for a quorum to be present or to
  approve the defective corporate act, the presence or approval of a
  larger number or portion of directors or of specified directors
  would have been required by the governing documents of the
  corporation, any plan or agreement to which the corporation was a
  party, or any provision of the corporate statute, each as in effect
  at the time of the defective corporate act, then the presence or
  approval of the larger number or portion of such directors or of
  such specified directors must be required for a quorum to be present
  or to adopt the resolutions to ratify the defective corporate act
  [resolution], as applicable.
         (c)  The presence or approval of any director elected,
  appointed, or nominated by holders of any class or series of which
  no shares are then outstanding, or by any person that is no longer a
  shareholder, shall not be required for a quorum to be present or to
  adopt the resolutions [resolution].
         SECTION 18.  Section 21.905, Business Organizations Code, is
  amended to read as follows:
         Sec. 21.905.  SHAREHOLDER APPROVAL [ADOPTION] OF RATIFIED
  DEFECTIVE CORPORATE ACT [RESOLUTION] REQUIRED; EXCEPTION.  Each
  defective corporate act ratified [The resolution adopted] under
  Section 21.903 must be submitted to shareholders for approval
  [adoption] as provided by Sections 21.906 and 21.907, unless:
               (1)  no other provision of the corporate statute, no
  provision of the corporation's governing documents, and no
  provision of any plan or agreement to which the corporation is a
  party would have required shareholder approval of:
                     (A)  the defective corporate act to be ratified[,
  either] at the time of that defective corporate [the] act; or
                     (B)  the type of defective corporate act to be
  ratified at the time the board of directors adopts the resolutions
  ratifying that defective corporate act under [when the resolution
  required by] Section 21.903 [is adopted]; and
               (2)  the defective corporate act to be ratified did not
  result from a failure to comply with Subchapter M.
         SECTION 19.  Section 21.906, Business Organizations Code, is
  amended to read as follows:
         Sec. 21.906.  NOTICE REQUIREMENTS FOR RATIFIED DEFECTIVE
  CORPORATE ACT [RESOLUTION] SUBMITTED FOR SHAREHOLDER APPROVAL.
  (a)  If the ratification of a defective corporate act is required
  to be submitted to the shareholders for approval under Section
  21.905 [requires that the resolution be submitted to the
  shareholders for approval], notice of the time, place, if any, and
  purpose of the meeting shall be given at least 20 days before the
  date of the meeting to:
               (1)  each holder of record, as of the record date of the
  meeting, of valid shares and putative shares, regardless of whether
  the shares are voting or nonvoting, at the address of the holder as
  it appears or most recently appeared, as appropriate, on the
  corporation's records; and
               (2)  [.
         [(b)  Notice under this section shall be given to] each
  holder of record of valid shares and putative shares, regardless of
  whether the shares are voting or nonvoting, as of the time of the
  defective corporate act, except that notice is not required to be
  given to a holder whose identity or address cannot be ascertained
  from the corporation's records.
         (b) [(c)]  The notice must contain:
               (1)  copies [a copy] of the resolutions adopted by the
  board of directors under Section 21.903 or the information required
  by Sections 21.903(a)(1)-(5) [resolution]; and
               (2)  a statement that, on shareholder approval of the
  ratification of the defective corporate act or putative shares made
  in accordance with this subchapter, the holder's rights to
  challenge the defective corporate act or putative shares are
  limited to an action claiming [the following must be brought not
  later than the 120th day of the validation effective time:
                     [(A)     any claim that the defective corporate act
  or putative shares ratified under this subchapter are void or
  voidable due to the identified failure of authorization; or
                     [(B)  any claim] that a [the district] court of
  appropriate jurisdiction, in its discretion, should declare:
                     (A)  that the [a] ratification [made in accordance
  with this subchapter] not take effect or that it take effect only on
  certain conditions, if that action is filed with the court not later
  than the 120th day after the applicable validation effective time;
  or
                     (B)  that the ratification was not accomplished in
  accordance with this subchapter.
         SECTION 20.  Section 21.907, Business Organizations Code, is
  amended to read as follows:
         Sec. 21.907.  SHAREHOLDER MEETING; QUORUM AND VOTING.
  (a)  At the shareholder meeting, the quorum and voting requirements
  applicable to the approval of the ratification [adoption] of a
  defective corporate act [the resolution] under Section 21.905 are
  [shall be] the same as the quorum and voting requirements
  applicable at the time of the approval [such adoption] by the
  shareholders of the ratification for the type of ratified defective
  corporate act proposed to be approved [ratified], except as
  provided by this section.
         (b)  If the presence or approval of a larger number or
  portion of shares or of any class or series of shares or of
  specified shareholders would have been required for a quorum to be
  present or to approve the defective corporate act, as applicable,
  by the corporation's governing documents, any plan or agreement to
  which the corporation was a party, or any provision of the corporate
  statute, each as in effect at the time of the defective corporate
  act, then the presence or approval of the larger number or portion
  of shares or of the class or series of shares or of such specified
  shareholders shall be required for a quorum to be present or to
  approve the ratification of the defective corporate act [adopt the
  resolution], as applicable, except that the presence or approval of
  shares of any class or series of which no shares are then
  outstanding, or of any person that is no longer a shareholder, is
  [shall] not [be] required.
         (c)  The approval by the shareholders of the ratification of
  [adoption of a resolution to ratify] the election of a director
  requires the affirmative vote of the majority of shares present at
  the meeting and entitled to vote on the election of the director at
  the time of the approval, unless the governing documents of the
  corporation then in effect or in effect at the time of the defective
  election require or required a larger number or portion of shares or
  of any class or series of shares or of specified shareholders to
  elect the director, in which case the affirmative vote of the larger
  number or portion of shares or of the class or series of shares or of
  the specified shareholders is required to ratify the election of
  the director, except that the presence or approval of shares of any
  class or series of which no shares are then outstanding, or of any
  person that is no longer a shareholder, is not required.
         (d)  If a failure of authorization results from the failure
  to comply with Subchapter M, the approval of the ratification of the
  defective corporate act requires the vote set forth by Section
  21.606(2), regardless of whether that vote would have otherwise
  been required.
         (e)  Putative shares on the record date for determining
  shareholders entitled to vote on any matter submitted to
  shareholders under Section 21.905 are not entitled to be counted
  for voting or quorum purposes in any vote to approve the
  ratification of any defective corporate act, regardless of any
  ratification that becomes effective after the record date.
         SECTION 21.  Section 21.908, Business Organizations Code, is
  amended to read as follows:
         Sec. 21.908.  CERTIFICATE OF VALIDATION. (a)  If a [the]
  defective corporate act ratified under this subchapter would have
  required under any other provision of the corporate statute the
  filing of a filing instrument or other document with the filing
  officer, the corporation[, instead of filing the filing instrument
  or other document otherwise required by this code,] shall file a
  certificate of validation with respect to the defective corporate
  act in accordance with Chapter 4, regardless of whether a filing
  instrument or other document was previously filed with respect to
  the defective corporate act.  The filing of another filing
  instrument or document is not required.
         (a-1)  A separate certificate of validation is required for
  each defective corporate act for which a certificate of validation
  is required under this section, except that: 
               (1)  two or more defective corporate acts may be
  included in a single certificate of validation if the corporation
  filed, or to comply with the applicable provisions of this code
  could have filed, a single filing instrument or other document
  under another provision of this code to effect the acts; 
               (2)  a single certificate of validation may be filed to
  amend the certificate of formation of the corporation to establish
  a new class or series of shares or to increase the number of
  authorized shares of any class or series of shares, in order to cure
  multiple previous overissues of the shares of the class or series;
  and
               (3)  a single certificate of validation may be filed to
  amend the corporation's certificate of formation to establish two
  or more new classes or series of shares, to increase the number of
  authorized shares of two or more classes or series of shares, or to
  establish one or more new classes or series of shares and increase
  the number of authorized shares of one or more classes or series of
  shares, in order to cure multiple previous overissues of the shares
  of all the classes and series that are the subjects of the
  certificate of validation.
         (a-2)  An amendment effected by a certificate of validation
  described by Subsection (a-1)(2) or (3) is effective as to each
  class or series that is a subject of the certificate of validation
  as of the first overissue of the shares of the class or series.
         (b)  The certificate of validation must include [set forth]:
               (1)  each defective corporate act that is a subject of
  the certificate of validation, including:
                     (A)  for a defective corporate act involving the
  issuance of putative shares, the number and type of putative shares
  issued and the date or dates on which the putative shares were
  purported to have been issued;
                     (B)  the date of the defective corporate act; and
                     (C)  the nature of the failure of authorization
  with respect to the defective corporate act [a copy of the
  resolution adopted in accordance with Sections 21.903 and 21.904,
  the date of adoption of the resolution by the board of directors
  and, if applicable, the date of adoption by the shareholders, and a
  statement that the resolution was adopted in accordance with this
  subchapter];
               (2)  a statement that each defective corporate act was
  ratified in accordance with this subchapter, including:
                     (A)  the date on which the board of directors
  ratified each defective corporate act; and
                     (B)  the date, if any, on which the shareholders
  approved the ratification of each defective corporate act; and
               (3)  as appropriate:
                     (A)  if a filing instrument [or document] was
  previously filed with a filing officer under the corporate statute
  with [in] respect to [of] the defective corporate act and no change
  to the filing instrument is required to give effect to the defective
  corporate act as ratified in accordance with this subchapter:
                           (i)  the name, [the] title, and filing date
  [of filing] of the previously filed [prior] filing instrument and
  of any certificate of correction to the filing instrument; and
                           (ii)  a statement that a copy of the
  previously filed filing instrument, together with [or document and]
  any [articles or] certificate of correction to the filing
  instrument, is attached as an exhibit to the certificate of
  validation [filing instrument]; [and]
                     (B)  if a filing instrument was previously filed
  with a filing officer under the corporate statute with respect to
  the defective corporate act and the filing instrument requires any
  change to give effect to the defective corporate act as ratified in
  accordance with this subchapter, including a change to the date and
  time of the effectiveness of the filing instrument:
                           (i)  the name, title, and filing date of the
  previously filed filing instrument and of any certificate of
  correction to the filing instrument;
                           (ii)  a statement that a filing instrument
  containing all the information required to be included under the
  applicable provisions of this code to give effect to the ratified
  defective corporate act is attached as an exhibit to the
  certificate of validation; and
                           (iii)  the date and time that the attached
  filing instrument is considered to have become effective under this
  subchapter; or
                     (C)  if a filing instrument was not previously
  filed with a filing officer under the corporate statute with
  respect to the defective corporate act and the defective corporate
  act as ratified under this subchapter would have required under the
  other applicable provisions of this code the filing of a filing
  instrument in accordance with Chapter 4, if the defective corporate
  act had occurred when this code was in effect:
                           (i)  a statement that a filing instrument
  containing all the information required to be included under the
  applicable provisions of this code to give effect to the defective
  corporate act, as if the defective corporate act had occurred when
  this code was in effect, is attached as an exhibit to the
  certificate of validation; and
                           (ii)  the date and time that the attached
  filing instrument is considered to have become effective under this
  subchapter
               [(3)     the provisions that would be required under any
  other section of this code to be included in the filing instrument
  that otherwise would have been required to be filed with respect to
  the defective corporate act under this code].
         (c)  A filing instrument attached to a certificate of
  validation under Subsection (b)(3)(B) or (C) does not need to be
  executed separately and does not need to include any statement
  required by any other provision of this code that the instrument has
  been approved and adopted in accordance with that provision.
         SECTION 22.  Section 21.909, Business Organizations Code, is
  amended to read as follows:
         Sec. 21.909.  ADOPTION OF RESOLUTIONS [RESOLUTION]; EFFECT
  ON DEFECTIVE CORPORATE ACT.  On or after the validation effective
  time, unless determined otherwise in an action brought under
  Section 21.914 and subject to Section 21.907(e), each defective
  corporate act ratified in accordance with this subchapter [set
  forth in the resolution adopted under Sections 21.903 and 21.904]
  may not be considered void or voidable as a result of the [a]
  failure of authorization described by [identified in] the
  resolutions adopted under Sections 21.903 and 21.904 [resolution],
  and the effect shall be retroactive to the time of the defective
  corporate act.
         SECTION 23.  Section 21.910, Business Organizations Code, is
  amended to read as follows:
         Sec. 21.910.  ADOPTION OF RESOLUTIONS [RESOLUTION]; EFFECT
  ON PUTATIVE SHARES.  On or after the validation effective time,
  unless determined otherwise in an action brought under Section
  21.914 and subject to Section 21.907(e), each putative share or
  fraction of a putative share issued or purportedly issued pursuant
  to a [the] defective corporate act ratified in accordance with this
  subchapter and described by [identified in] the resolutions
  [resolution] adopted under Sections 21.903 and 21.904 may not be
  considered void or voidable [as a result of a failure of
  authorization identified in the resolution] and[, in the absence of
  any failure of authorization not ratified,] is considered to be an
  identical share or fraction of a share outstanding as of the time it
  was purportedly issued.
         SECTION 24.  The heading to Section 21.911, Business
  Organizations Code, is amended to read as follows:
         Sec. 21.911.  NOTICE TO SHAREHOLDERS FOLLOWING RATIFICATION
  OF DEFECTIVE CORPORATE ACT [ADOPTION OF RESOLUTION].
         SECTION 25.  Section 21.911, Business Organizations Code, is
  amended by amending Subsections (a), (d), (e), and (f) and adding
  Subsection (g) to read as follows:
         (a)  For each defective corporate act ratified by the board
  of directors under Sections 21.903 and 21.904, notice [Notice] of
  the ratification [adoption of a resolution under this subchapter]
  shall be given promptly to:
               (1)  each holder of valid shares and putative shares,
  regardless of whether the shares are voting or nonvoting, as of the
  date the board of directors adopted the resolutions ratifying the
  defective corporate act [resolution]; or
               (2)  each holder of valid shares and putative shares,
  regardless of whether the shares are voting or nonvoting, as of a
  date not later than the 60th day after the date of adoption [on
  which the resolution is adopted], as established by the board of
  directors.
         (d)  The notice must contain:
               (1)  copies [a copy] of the resolutions adopted by the
  board of directors under Section 21.903 or the information required
  by Sections 21.903(a)(1)-(5) [resolution]; and
               (2)  a statement that, on ratification of the defective
  corporate act or putative shares made in accordance with this
  subchapter, the holder's rights to challenge the defective
  corporate act or putative shares are limited to an action claiming
  [the following must be brought not later than the 120th day of the
  validation effective time:
                     [(A)     any claim that the defective corporate act
  or putative shares ratified under this subchapter are void or
  voidable due to the identified failure of authorization; or
                     [(B)  any claim] that a [the district] court of
  appropriate jurisdiction, in its discretion, should declare:
                     (A)  that the [a] ratification [made in accordance
  with this subchapter] not take effect or that it take effect only on
  certain conditions, if the action is filed not later than the 120th
  day after the later of the applicable validation effective time or
  the time at which the notice required by this section is given; or
                     (B)  that the ratification was not accomplished in
  accordance with this subchapter.
         (e)  Notwithstanding Subsections (a)-(d):
               (1)  [,] notice is not required to be given under this
  section to a person if notice of the ratification of the defective
  corporate act [resolution] is given to that person in accordance
  with Section 21.906; and
               (2)  for a corporation that has a class of stock listed
  on a national securities exchange, the notice required by this
  section may be considered given if the information contained in the
  notice is disclosed in a document publicly filed by the corporation
  with the Securities and Exchange Commission under Section 13, 14,
  or 15(d), Securities Exchange Act of 1934 (15 U.S.C. Section 78m,
  78n, or 78o(d)), and any rules promulgated under that Act.
         (f)  For purposes of Sections 21.905, [Section] 21.906, and
  21.907 and this section, notice to holders of putative shares and
  notice to holders of valid shares and putative shares as of the time
  of the defective corporate act shall be treated as notice to holders
  of valid shares for purposes of Sections 6.051, 6.052, 6.053,
  6.201, 6.202, 6.203, 6.204, 6.205, 21.353, and 21.3531.
         (g)  If the ratification of a defective corporate act has
  been approved by shareholders acting under Section 6.202, the
  notice required by this section may be included in any notice
  required to be given under Section 6.202(d) and, if included:
               (1)  shall be sent to the shareholders entitled to the
  notice under Section 6.202(d) and all other holders of valid shares
  and putative shares otherwise entitled to the notice under
  Subsection (a) of this section; and
               (2)  is not required to be sent to shareholders or
  holders of valid shares or putative shares who signed a consent
  described by Section 6.202(b).
         SECTION 26.  Section 21.913(a), Business Organizations
  Code, is amended to read as follows:
         (a)  Ratification of an act or transaction under this
  subchapter or validation of an act or transaction as provided by
  Sections 21.914 through 21.917 is not the exclusive means of
  ratifying or validating any act or transaction taken by or on behalf
  of the corporation, including any defective corporate act or any
  issuance of putative shares or other shares, or of adopting or
  endorsing any act or transaction taken by or in the name of the
  corporation before the corporation exists.
         SECTION 27.  Section 21.917, Business Organizations Code, is
  amended by amending Subsection (b) and adding Subsection (c) to
  read as follows:
         (b)  Notwithstanding any other provision of this
  subchapter[, the following may not be brought after the expiration
  of the 120th day of the validation effective time]:
               (1)  an action claiming [asserting] that a defective
  corporate act or putative shares [ratified in accordance with this
  subchapter] are void or voidable due to a failure of authorization
  identified in the resolutions [resolution] adopted in accordance
  with Section 21.903 may not be filed in or must be dismissed by any
  court after the applicable validation effective time; and [or]
               (2)  an action claiming [asserting] that a [the
  district] court of appropriate jurisdiction, in its discretion,
  should declare that a ratification in accordance with this
  subchapter not take effect or that the ratification take effect
  only on certain conditions may not be filed with the court after the
  expiration of the 120th day after the later of the validation
  effective time or the time that any notice required to be given
  under Section 21.911 is given with respect to the ratification.
         (c)  Except as otherwise provided by a corporation's
  governing documents, for purposes of this section, notice under
  Section 21.911 that is:
               (1)  mailed is considered to be given on the date the
  notice is deposited in the United States mail with postage paid in
  an envelope addressed to the holder at the holder's address
  appearing or most recently appearing, as appropriate, in the
  records of the corporation; and
               (2)  transmitted by facsimile or electronic message is
  considered to be given when the facsimile or electronic message is
  transmitted to a facsimile number or an electronic message address
  provided by the holder, or to which the holder consents, for the
  purpose of receiving notice.
         SECTION 28.  Section 22.154(a), Business Organizations
  Code, is amended to read as follows:
         (a)  If the board of directors of a corporation fails to call
  the annual meeting of members when required, a member of the
  corporation may demand that the meeting be held within a reasonable
  time.  The demand must be made in writing and sent to an officer of
  the corporation by certified or registered mail, return receipt
  requested, or by other means specified in the corporation's
  governing documents.
         SECTION 29.  Section 22.214, Business Organizations Code, is
  amended to read as follows:
         Sec. 22.214.  ACTION BY DIRECTORS. The act of a majority of
  the directors present in person or by proxy at a meeting at which a
  quorum is present at the time of the act is the act of the board of
  directors of a corporation, unless the act of a greater number is
  required by the certificate of formation or bylaws of the
  corporation.
         SECTION 30.  Section 22.227, Business Organizations Code, is
  amended to read as follows:
         Sec. 22.227.  DISSENT TO OR ABSTENTION FROM ACTION. (a)  A
  director of a corporation who is present at a meeting of the board
  of directors at which action is taken on a corporate matter
  described by Section 22.226(a) is presumed to have assented to the
  action unless:
               (1)  the director's dissent or abstention has been
  entered in the minutes of the meeting;
               (2)  the director has filed a written dissent or
  abstention with respect to the action with the person acting as the
  secretary of the meeting before the meeting is adjourned; or
               (3)  the director has sent [a written dissent by
  registered mail] to the secretary of the corporation, within a
  reasonable time [immediately] after the meeting has been adjourned,
  a written dissent or abstention by:
                     (A)  certified or registered mail, return receipt
  requested; or
                     (B)  other means specified in the corporation's
  governing documents.
         (b)  The right to dissent or abstain under this section does
  not apply to a director who voted in favor of the action.
         SECTION 31.  Section 200.251, Business Organizations Code,
  is amended by amending Subsection (b) and adding Subsection (b-1)
  to read as follows:
         (b)  If the annual meeting is not held at the designated
  time, a shareholder may [by certified or registered mail] make a
  written request to an officer or trust manager of the real estate
  investment trust that the meeting be held within a reasonable time.
  The request calling for the meeting must be made by:
               (1)  certified or registered mail, return receipt
  requested; or
               (2)  other means specified in the real estate
  investment trust's governing documents.
         (b-1)  If the annual meeting is not called before the 61st
  day after the date the written request calling for a meeting is made
  under Subsection (b), any shareholder may bring suit at law or in
  equity to compel the meeting to be held.
         SECTION 32.  Sections 251.354(a) and (b), Business
  Organizations Code, are amended to read as follows:
         (a)  If a cooperative association required by Section
  251.353 to file a copy of a report with the secretary of state does
  not file the report within the prescribed time, the secretary of
  state shall send written notice of the requirement [by registered
  mail] to the cooperative association at[. The notice must be sent
  to] the cooperative association's principal office not later than
  the 60th day after the date the report becomes due.
         (b)  If a cooperative association [is] required by Section
  251.353 to file a report at the cooperative association's [its]
  registered office, but not with the secretary of state, [and] fails
  to file the report within the prescribed time, the secretary of
  state or any member of the cooperative association may send written
  notice of the requirement [by registered mail] to the cooperative
  association's principal office.
         SECTION 33.  Section 252.017(b), Business Organizations
  Code, is amended to read as follows:
         (b)  Chapters 1, [and] 4, and 10 and, if a nonprofit
  association designates an agent for service of process, Subchapter
  E, Chapter 5, apply to a nonprofit association.
         SECTION 34.  Chapter 252, Business Organizations Code, is
  amended by adding Section 252.018 to read as follows:
         Sec. 252.018.  MERGERS AND CONVERSIONS. A nonprofit
  association may effect a merger or conversion by complying with the
  applicable provisions of Chapter 10 and the nonprofit association's
  governing documents.
         SECTION 35.  Chapter 402, Business Organizations Code, is
  amended by adding Section 402.015 to read as follows:
         Sec. 402.015.  PERPETUAL DURATION OF OLD CORPORATIONS.
  (a)  Notwithstanding any provision in the articles of
  incorporation limiting the period of duration of a domestic
  for-profit corporation formed before September 6, 1955, the period
  of duration of the corporation became perpetual on May 2, 1979, if
  the corporation was in existence according to the records of the
  secretary of state on May 2, 1979. A corporation described by this
  subsection may amend the corporation's articles of incorporation or
  certificate of formation, as applicable, to limit the corporation's
  period of duration after May 2, 1979.
         (b)  Notwithstanding a provision in the articles of
  incorporation limiting the period of duration of a domestic
  nonprofit corporation formed before August 10, 1959, the period of
  duration of the corporation became perpetual on May 2, 1979, if the
  corporation was in existence according to the records of the
  secretary of state on May 2, 1979. A corporation described by this
  subsection may amend the corporation's articles of incorporation or
  certificate of formation, as applicable, to limit the corporation's
  period of duration after May 2, 1979.
         SECTION 36.  This Act takes effect September 1, 2017.