Tex. Bus. Orgs. Code § 2.103 · Subchapter B. POWERS OF DOMESTIC ENTITY
POWER TO INCUR INDEBTEDNESS.
Text — Current through the 89th 2nd Called Legislative Session, 2025
(a) Unless otherwise provided by its governing documents or this code, a domestic entity may create indebtedness for any consideration the entity considers appropriate, including:
(1) cash;
(2) property;
(3) a contract to receive property;
(4) a debt or other obligation of the entity or of another person;
(5) services performed or a contract for services to be performed; or
(6) a direct or indirect benefit realized by the entity.
(b) In the absence of fraud in the transaction, the judgment of the governing authority of a domestic entity as to the value of the consideration received by the entity for indebtedness is conclusive.
(c) The consideration for the indebtedness may be received either directly or indirectly by the domestic entity, including by a domestic or foreign organization that is wholly or partially owned, directly or indirectly, by the domestic entity.
(d) This section does not apply to indebtedness created by a domestic entity that is incurred by reason of the authorization or payment of a distribution.
Notes and commentary — not statutory text
History
Acts 2003, 78th Leg., ch. 182, Sec. 1, eff. Jan. 1, 2006.
Source of truth
- Edition
- Current through the 89th 2nd Called Legislative Session, 2025
- Official file
- https://statutes.capitol.texas.gov/Docs/BO/htm/BO.2.htm
- Text hash
- sha256 56e0b3d70ddbfa604eb9fae0505381865327334fb3f061fc155f9b8ecdb8ac9f
- Composed by
- compose_tx.py 2026-10-05: the Legislative Council's chapter files read in document order; verify_tx.py's independent reading (lxml DOM walk) agrees character for character
Procedural information only. Not legal advice and not a substitute for the advice of an attorney. Confirm the current text with the official publisher before relying on it.