Texas Business Organizations Code - Section 21.154. Certain Optional Characteristics Of Shares
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§ 21.154. CERTAIN OPTIONAL CHARACTERISTICS OF
SHARES. (a) Subject to Section 21.153, if authorized by the
corporation's certificate of formation, a corporation may issue
shares that:
(1) are redeemable, at the option of the corporation,
shareholder, or other person or on the occurrence of a designated
event, subject to Sections 21.303 and 21.304;
(2) entitle the holders of the shares to cumulative,
noncumulative, or partially cumulative distributions;
(3) have preferences over any or all other classes or
series of shares with respect to payment of distributions;
(4) have preferences over any or all other classes or
series of shares with respect to the assets of the corporation on
the voluntary or involuntary winding up and termination of the
corporation;
(5) are exchangeable, at the option of the
corporation, shareholder, or other person or on the occurrence of a
designated event, for shares, obligations, indebtedness, evidence
of ownership, rights to purchase securities of the corporation or
one or more other entities, or other property or for a combination
of those rights, assets, or obligations, subject to Section 21.303;
and
(6) are convertible into shares of any other class or
series, at the option of the corporation, shareholder, or other
person or on the occurrence of a designated event.
(b) Shares without par value may not be converted into
shares with par value unless:
(1) at the time of conversion, the part of the
corporation's stated capital represented by the shares without par
value is at least equal to the aggregate par value of the shares to
be converted; or
(2) the amount of any deficiency computed under
Subdivision (1) is transferred from surplus to stated capital.
Acts 2003, 78th Leg., ch. 182, § 1, eff. Jan. 1, 2006.
Section: 21.106 21.107 21.108 21.109 21.151 21.152 21.153 21.154 21.155 21.156 21.157 21.158 21.159 21.160 21.161
Last modified: August 11, 2007
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