Change in TX Law - Registered Agent Must Consent to Serve

The following bulletin was prepared by Susan Marx of our Corporate and Securities practice group. Please don't hesitate to contact her or me if you need further information.

Effective January 1, 2010, an individual or entity must provide its written or electronic consent (a "Consent") prior to being named as a domestic or foreign entity's registered agent for service of process in Texas (TBOC Section 5.201(b)). The Texas Secretary of State has developed a form entitled "Acceptance of Appointment and Consent to Serve as Registered Agent" that may be used, but is not required. If the form is not used, the Consent must at a minimum identify the agent and the organization for whom the agent is agreeing to serve, and include the agent's dated signature.

The Consent need NOT be filed with the Texas Secretary of State, but should be retained in the records of the represented entity. The Consent may be filed separately with the Texas Secretary of State for a $15 fee. If the Consent is filed together with a Certificate of Formation, Certificate of Amendment, Statement of Change of Registered Agent, Certificate of Merger or Conversion, or Application for Registration of a Foreign Entity, however, no fee is required.

Prior to the sale, acquisition, or transfer of a majority of the outstanding shares or ownership interests of a Texas entity, the governing authority of the entity must verify whether the person or entity named as registered agent of the entity prior to the transaction has consented to continue to serve the represented entity in that capacity after the transaction (TBOC Section 5.2011(b)).

When filing a Certificate of Formation, Certificate of Amendment, Statement of Change of Registered Agent, or Certificate of Merger or Conversion for a Texas entity, or qualifying a foreign entity in Texas, one of the following procedures should be followed regarding the Consent:

1. If you are using Capitol Services to effect the filing and it also will serve as registered agent, you should be aware that Capitol Services has developed a policy pursuant to which it will automatically sign and include the Consent with all filings that designate or appoint a registered agent or that effect a change or correction in registered agent information, including Certificates of Formation, Certificates of Amendment, Statements of a Change of Registered Agent, Certificates of Merger or Conversion and Applications for Registration of a Foreign Entity. Capitol Services will file the Consent with the Secretary of State, and no fee will be charged when it is filed together with one of the foregoing filings.
2. If an individual or another service (such as CT Corporation) will serve as registered agent, you should either (i) complete the form developed by the Secretary of State (link above) and request that the agent sign and return it for your records, or (ii) secure a Consent by sending an email to the proposed agent containing the required information discussed above.

Please note that under the revised TBOC sections, the appointment of a person as a registered agent constitutes an affirmation by the filing entity that a person has consented to serve as the registered agent. Persons who have not consented to serve as registered agent are able to withdraw and avoid liability.

Pursuant to TBOC Section 5.207, the penalties under TBOC Sections 4.007 and 4.008 also apply to filing a statement that names the registered agent without that person's consent. TBOC Section 4.007 provides that a person who has sustained a loss as a result of a false filing may recover damages, court costs and reasonable attorneys' fees. TBOC Section 4.008 further provides that making a false filing is a Class A misdemeanor, unless the actor's intent is to defraud or harm another, in which case it is a state jail felony.

You can read the revised provisions of the Texas Business Organizations Code effecting these changes by clicking here.