§ 21.730 — LACK OF FORMALITIES; TREATMENT AS PARTNERSHIP.

Texas § 21.730

• Jurisdiction: Texas
• Code BO: Business Organizations Code

Text

Sec. 21.730. LACK OF FORMALITIES; TREATMENT AS PARTNERSHIP. 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.

Legislative History

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