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socrateaser
socrateaser, Attorney
Category: Business Law
Satisfied Customers: 33385
Experience:  Retired (mostly)
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This is in relation to the last question. We will pay you

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This is in relation to the last question. We will pay you a bonus of 60.00 on completion for this if you are willing.

We understand that we are able to make the two small changes. We have one last change we have found that is necessary. Our annual meeting is held in November and the articles state December. Is this something that can be changed by action of the Board? We are really confused as to how to determine what constitutes major changes that the membership would have to approve and what minor changes the Board can act on. Can you enlighten us just a tad. On top of that request, would you be interested in reviewing our Articles of Incorporation and Bylaws aside from this site...
Submitted: 3 years ago.
Category: Business Law
Expert:  socrateaser replied 3 years ago.
Hi,

I'm a different lawyer, and I respectfully XXXXX XXXXX my colleague's previous answer to you concerning Texas Corporations law.

Under Bus. Org. Code. (BOC) 22.160.(a), "Each member of a corporation, regardless of class, is entitled to one vote on each matter submitted to a vote of the corporation's members, except to the extent that the voting rights of members of a class are limited, enlarged, or denied by the certificate of formation or bylaws of the corporation."

Based upon the statutory language, if your Articles state that the corporation has members, but does not deny the members the right to vote, then each member has voting rights.

What follows from this is that under BOC 22.105 and 22.107(b), the board may modify the Articles so as to add the suffix "Inc." to the name of the corporation without member approval -- however, it must set an annual or special meeting to modify the date of the annual meeting, if that meeting date is set forth in the Articles.

Note: As of Jan 1, 2010, the term "Articles of Incorporation," under Texas law has been replaced by the term "Certificate of Formation." The terms have identical meaning.

Finally, in answer to your question about reviewing your Articles/Certificate, I regret that such a review is beyond the scope of services that can be provided in this forum.

EDIT AFTER: Out of morbid curiosity, I have now taken the liberty to review the first question and answer that you received in this forum, and once again, I regret to inform you that in my opinion, it too is incorrect. And you are not going to like my answer here one little bit.

Under BOC 11.152(b), "A domestic entity whose specified period of duration has expired may cancel that event requiring winding up by amending its governing documents in the manner provided by this code, not later than the third anniversary of the date the period expired or an earlier date prescribed by the title of this code governing the domestic entity, to extend its period of duration."

In short, if your corp had a 50 year duration which expired in the year 2002, then you must either cancel the termination of the corporation before the year 2006 or wind it up, and if you do not, then the Texas Secretary of State will be forced by law to wind it up for you, pursuant to the mandate of BOC 11.104.

To be frank, if you do as the first "expert" suggests and contact the Secretary of State, you will effectively be putting yourself out of business, because the SOS will have no alternative but to forcibly wind up your corporation. Whereas if you say nothing at all, then you may be able to form a new corporation, and sell your assets to that entity, before winding up the original corporation. Note also, that as of the year 2006, any contract entered into by your corporation is unenforceable, in the event that a dispute arises, because your corporation is not lawfully entitled to continue its existence after 12/31/2005.

On a final note, if you are dissatisfied with any of the answers that you previously received here, you may contact customer service and demand a refund. I hope that you will not do that with my answer here -- but, considering the circumstances, I wouldn't blame you -- despite my diligence in trying to set the record straight, before you plow your corporate ship right up onto the rocks.

Hope this helps.

Edited by socrateaser on 11/4/2010 at 8:18 AM EST
Customer: replied 3 years ago.

Thank you thank you thank you!!!

 

We can form the new non profit and sell the assets to it. Problem is that we have a trust that the corporation is a beneficiary of. If we change our name, we might be out of compliance. Can we use the same name again? or ???

Expert:  socrateaser replied 3 years ago.
Re using the same name again, you can't possibly do that until the original corporation is wound up, because the name wouldn't be available. My question, and this is one that you may actually benefit from contacting the Secretary of State about, is how soon is a preexisting name becomes available again after a corporation is wound up. The SOS may "mothball" the name for a certain period of time, in order to avoid confusion. If not, then you could conceivably wind up the existing corporation and immediately register the new one under the same name.

Otherwise, you would have to ask the probate court to order your new corporation the beneficiary of the old corporation's interest in the trust, because as it stands now, your corporation actually has no legal authority to assign its benefits under the trust to a new entity.

This really is a mess.
socrateaser, Attorney
Category: Business Law
Satisfied Customers: 33385
Experience: Retired (mostly)
socrateaser and 5 other Business Law Specialists are ready to help you
Customer: replied 3 years ago.
Thanks, XXXXX XXXXX what I exactly needed to know. Yes it is a mess of gargantuan porportions.

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