Tex. Bus. Orgs. Code § 21.730 · Subchapter O. CLOSE CORPORATION
LACK OF FORMALITIES; TREATMENT AS PARTNERSHIP.
Text — Current through the 89th 2nd Called Legislative Session, 2025
The failure of a close corporation under this subchapter to observe a usual formality or requirement prescribed for an ordinary corporation by this chapter relating to the exercise of corporate powers or the management of a corporation's business and affairs and the performance of a shareholders' agreement that treats the close corporation as if the corporation were a partnership or in a manner that otherwise is appropriate only among partners may not:
(1) be a factor in determining whether to impose personal liability on the shareholders for the close corporation's obligations by disregarding the separate entity of the close corporation or otherwise;
(2) be grounds for invalidating an otherwise valid shareholders' agreement; or
(3) affect the status of the close corporation as a corporation under this chapter or other law.
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.21.htm
- Text hash
- sha256 6240fff95259f08b10d574dba6d8d63040796e22c8a3fcbdc81fb3a681ef53b7
- 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
Cited by 1 provision
Provisions in this library whose text cites Tex. Bus. Orgs. Code § 21.730. Each shows the citation as that text prints it.
Business Organizations Code
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.