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Texas Business Organizations Code - Section 21.206. Limitation On Action To Enforce Preemptive Right

Legal Research Home > Texas Lawyer > Business Organizations Code > Texas Business Organizations Code - Section 21.206. Limitation On Action To Enforce Preemptive Right

§ 21.206. LIMITATION ON ACTION TO ENFORCE PREEMPTIVE 
RIGHT.  (a) An action brought against a corporation, the board of 
directors or an officer, shareholder, or agent of the corporation, 
or an owner of a beneficial interest in shares of the corporation 
for the violation of a preemptive right of a shareholder must be 
brought not later than the earlier of:
		(1)  the first anniversary of the date written notice 
is given to each shareholder whose preemptive right was violated;  
or
		(2)  the fourth anniversary of the latest of:                                 
			(A)  the date the corporation issued the shares, 
securities, or rights;    
			(B)  the date the corporation sold the shares, 
securities, or rights;  or  
			(C)  the date the corporation otherwise 
distributed the shares, securities, or rights.
	(b)  The notice required by Subsection (a)(1) must:                            
		(1)  be sent to the holder at the address for the holder 
as shown on the appropriate records of the corporation;  and
		(2)  inform the holder that the issuance, sale, or 
other distribution of shares, securities, or rights violated the 
holder's preemptive right.

Acts 2003, 78th Leg., ch. 182, § 1, eff. Jan. 1, 2006.                     

Last modified: August 11, 2007