I 

,. 2 L . 

I 

i ‘ 

z-. OFFICE OF THE ATTORNEY GENERAL OF TEXAS 

b AUSTIN 

3-GHANR 

-- 

Honorable William J. Lawson 

Seoretary of State 

km t in, Texas 

Dear Sir: 

Be: one 00 

Lone star GM Oorpor ce holding oompnny, 

and it8 subrldiari 

tion, Uommunlty Eia 

Tex8s Cltler Ga8 0 

store and oreatr two 

e assets ot all tha ol4 

rations are idimiri84 

it is propose4 that oor00mpany,~ an4 that 

Corporation "Au will not 

0t Arti0ie 1302, v. A. 0. s. 

Base4 upon euoh iaot situation, you propoun4 the 

pueetion: 

V&n Corporation A, whloh will be ohartere4 

under eubdlviaion 36 of hrtiole 1302, ati whioh 

will engage in the purohasr, trmalniseion and . 

dietributlon of natural gas to the gsnera;l publio, 
Honorable %SIllIam J. Lawson, page 2 

own ond hold the stock of Corporation B, 

which will also be ohartared under subdivlslon 36 or Artiale 1302 and whiah will engage 

IA the 011 and g&e produalng business, it being understood that Corporation A will not 

itself dlreotly engage IA the 011 an4 gas 

producing business, but will engage thereln 

lndlreotly through Its ownership of the 

stock of Corporation BP" 

Sub4lvlsIon 36 or Artlole 1302, V. A. C. S., as 

amended by Rots or 1935, Forty-rourth Legislature, Page 296, 

Ohapter 110, reada: 

wiirtiole 1302 - Purposes - The purposes ror 

which private oorporations may be formed are8 

a * l * 

“36. To store, transport, buy an4 sell oil, gas, 

salt, brine and other mineral solutions an4 llquIrle4 minerals; also sand an4 olay for the manuraoture and sale or clay pro4wts.w 

Wq held In our Opinion MO. O-3003 that the rights, ' 

benelite an4 privileges oonterred by Chapter 15, Title 32, 

V. A. C. S., oould be adopted by those oorporatlons ohartered 

or holding a roreign permit uader aubblvialon 36 oi Artlole 

1302, eupra. 

XrtIole 1502, V. A. C. S., oontained IA Chapter 15, 

arrorde one ot suoh right.8 an4 privileges en4 It Is 

:~p&.artlale to whloh we must look for the answer to the 

epeolrlo queitlon berore'ti. It reads: 

*In lieu or engagfng dlreotly IA the oil an4 gas 

pro4uofng business IA any State or oonntry, a oorjioratloa organized under this ohapter an4 authorized 

to ewhge in said produoing business may own the 

stock of other aorporetlona engaged therein, provided 

that It shall not own the etoak of more than one producing corporation, or one pipe line crorporation, 

organized under the laws of this or any other single 

State. No oorporatlon organIze4 In any other state 

or country shall be permitted to own or operate oil 
pipe lines or engage In the oil produolng business 

In this State when the stock of suoh oorporation 

icr omed In whole or In part by a oorporatlon organized un3er this ohapter." 

There la no question but that a r?OrpOratiOA oreated 

mder subdivision 36, supra, has the right to enga@e in the 

oil an4 gar pro4uoIng buolnesa. Article 1499 also oontalned 

in Chapt8r 15 expressly OOArer6 euch rights. 

It Is our oplnlm that the propose4 oorporatlon *A’ 

sin lieu of engaging direotly In the 011 and gas pro4uolng 

busiPeesW may own stook of the proposed oorporatlon crB.n 

We era returning the instruments submitted with your 

lettsr 0r request. 

Your8 very truly 

ATTCRNEY Gl?NERE,L OF TECS 

BY 

Lloyd Awstroag 

Assi8tant