A domestic entity may cancel a winding-up event and keep operating if the code and its governing documents allow it, and it must do so within the stated time limits.
Sec. 11.152. CONTINUATION OF BUSINESS WITHOUT WINDING UP. (a) Subject to Subsections (c) and (d), a domestic entity to which an event requiring the winding up of the entity occurs as specified by Section 11.051(3) or (4) may cancel the event requiring winding up in the manner specified in the title of this code governing the domestic entity not later than the first anniversary of the date of the event requiring winding up or an earlier period prescribed by the title of this code governing the domestic entity. (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. The expiration of its period of duration does not by itself create a vested right on the part of an owner, member, or creditor of the entity to prevent the extension of that period. An act undertaken or a contract entered into by the domestic entity during a period in which the entity could have extended its period of duration as provided by this subsection is not invalidated by the expiration of that period, regardless of whether the entity has taken any action to extend its period of duration. (c) A domestic entity may not cancel an event requiring winding up specified in Section 11.051(3) and continue its business if the action is prohibited by the entity's governing documents or the title of this code governing the entity. (d) A domestic entity may cancel an event requiring winding up specified in Section 11.051(4) and continue its business only if the action: (1) is not prohibited by the entity's governing documents; and (2) is expressly authorized by the title of this code governing the entity. (e) On cancellation of an event requiring winding up under this section, the domestic entity may continue its business. Acts 2003, 78th Leg., ch. 182, Sec. 1, eff. Jan. 1, 2006. Amended by: Acts 2007, 80th Leg., R.S., Ch. 688 (H.B. 1737), Sec. 67, eff. September 1, 2007.