reglab/statecodes huggingface dataset:
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 21 - For-Profit Corporations › Subchapter R. Ratification of Defective Corporate Acts or Shares; Proceedings › Section 21.904. Quorum and Voting Requirements for Adoption of Resolutions

Sec. 21.904.  QUORUM AND VOTING REQUIREMENTS FOR ADOPTION OF RESOLUTIONS.  (a)  The quorum and voting requirements applicable to the adoption of the resolutions to ratify a defective corporate act under Section 21.903 are the same as the quorum and voting requirements applicable at the time of the adoption of the resolutions for the type of defective corporate act proposed to be ratified.
(b)  Notwithstanding Subsection (a) and except as provided by Subsection (c), if in order for a quorum to be present or to approve the defective corporate act, the presence or approval of a larger number or portion of directors or of specified directors would have been required by the governing documents of the corporation, any plan or agreement to which the corporation was a party, or any provision of the corporate statute, each as in effect at the time of the defective corporate act, then the presence or approval of the larger number or portion of such directors or of such specified directors must be required for a quorum to be present or to adopt the resolutions to ratify the defective corporate act, as applicable.
(c)  The presence or approval of any director elected, appointed, or nominated by holders of any class or series of which no shares are then outstanding, or by any person that is no longer a shareholder, shall not be required for a quorum to be present or to adopt the resolutions.
Added by Acts 2015, 84th Leg., R.S., Ch. 32 (S.B. 860), Sec. 30, eff. September 1, 2015.
Amended by:
Acts 2017, 85th Leg., R.S., Ch. 75 (S.B. 1518), Sec. 17, eff. September 1, 2017.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 21 - For-Profit Corporations › Subchapter R. Ratification of Defective Corporate Acts or Shares; Proceedings › Section 21.905. Shareholder Approval of Ratified Defective Corporate Act Required; Exception

Sec. 21.905.  SHAREHOLDER APPROVAL OF RATIFIED DEFECTIVE CORPORATE ACT REQUIRED; EXCEPTION.  Each defective corporate act ratified under Section 21.903 must be submitted to shareholders for approval as provided by Sections 21.906 and 21.907, unless:
(1)(A)  no other provision of the corporate statute, no provision of the corporation's governing documents, and no provision of any plan or agreement to which the corporation is a party would have required shareholder approval of:
(i)  the defective corporate act to be ratified at the time of that defective corporate act; or
(ii)  the type of defective corporate act to be ratified at the time the board of directors adopts the resolutions ratifying that defective corporate act under Section 21.903; and
(B)  the defective corporate act to be ratified did not result from a failure to comply with Subchapter M; or
(2)  as of the record date for determining the shareholders entitled to vote on the ratification of the defective corporate act, there are no valid shares outstanding and entitled to vote on the ratification, regardless of whether as of that record date there exist any putative shares.
Added by Acts 2015, 84th Leg., R.S., Ch. 32 (S.B. 860), Sec. 30, eff. September 1, 2015.
Amended by:
Acts 2017, 85th Leg., R.S., Ch. 75 (S.B. 1518), Sec. 18, eff. September 1, 2017.
Acts 2019, 86th Leg., R.S., Ch. 665 (S.B. 1971), Sec. 11, eff. September 1, 2019.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 21 - For-Profit Corporations › Subchapter R. Ratification of Defective Corporate Acts or Shares; Proceedings › Section 21.906. Notice Requirements for Ratified Defective Corporate Act Submitted for Shareholder Approval

Sec. 21.906.  NOTICE REQUIREMENTS FOR RATIFIED DEFECTIVE CORPORATE ACT SUBMITTED FOR SHAREHOLDER APPROVAL.  (a)  If the ratification of a defective corporate act is required to be submitted to the shareholders for approval under Section 21.905, notice of the time, place, if any, and purpose of the meeting shall be given at least 20 days before the date of the meeting to:
(1)  each holder of record, as of the record date of the meeting, of valid shares and putative shares, regardless of whether the shares are voting or nonvoting, at the address of the holder as it appears or most recently appeared, as appropriate, on the corporation's records; and
(2)  each holder of record of valid shares and putative shares, regardless of whether the shares are voting or nonvoting, other than to a holder whose identity or address cannot be ascertained from the corporation's records:
(A)  as of the time of the defective corporate act; or
(B)  in the case of any defective corporate act that involved the establishment of a putative record date, as of that putative record date.
(b)  The notice must contain:
(1)  copies of the resolutions adopted by the board of directors under Section 21.903 or the information required by Sections 21.903(a)(1)-(5); and
(2)  a statement that, on shareholder approval of the ratification of the defective corporate act or putative shares made in accordance with this subchapter, the holder's rights to challenge the defective corporate act or putative shares are limited to an action claiming that a court of appropriate jurisdiction, in its discretion, should declare:
(A)  that the ratification not take effect or that it take effect only on certain conditions, if that action is filed with the court not later than the 120th day after the applicable validation effective time; or
(B)  that the ratification was not accomplished in accordance with this subchapter.
Added by Acts 2015, 84th Leg., R.S., Ch. 32 (S.B. 860), Sec. 30, eff. September 1, 2015.
Amended by:
Acts 2017, 85th Leg., R.S., Ch. 75 (S.B. 1518), Sec. 19, eff. September 1, 2017.
Acts 2019, 86th Leg., R.S., Ch. 665 (S.B. 1971), Sec. 12, eff. September 1, 2019.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 21 - For-Profit Corporations › Subchapter R. Ratification of Defective Corporate Acts or Shares; Proceedings › Section 21.909. Adoption of Resolutions; Effect on Defective Corporate Act

Sec. 21.909.  ADOPTION OF RESOLUTIONS; EFFECT ON DEFECTIVE CORPORATE ACT.  On or after the validation effective time, unless determined otherwise in an action brought under Section 21.914 and subject to Section 21.907(e), each defective corporate act ratified in accordance with this subchapter may not be considered void or voidable as a result of the failure of authorization described by the resolutions adopted under Sections 21.903 and 21.904, and the effect shall be retroactive to the time of the defective corporate act.
Added by Acts 2015, 84th Leg., R.S., Ch. 32 (S.B. 860), Sec. 30, eff. September 1, 2015.
Amended by:
Acts 2017, 85th Leg., R.S., Ch. 75 (S.B. 1518), Sec. 22, eff. September 1, 2017.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 21 - For-Profit Corporations › Subchapter R. Ratification of Defective Corporate Acts or Shares; Proceedings › Section 21.910. Adoption of Resolutions; Effect on Putative Shares

Sec. 21.910.  ADOPTION OF RESOLUTIONS; EFFECT ON PUTATIVE SHARES.  On or after the validation effective time, unless determined otherwise in an action brought under Section 21.914 and subject to Section 21.907(e), each putative share or fraction of a putative share issued or purportedly issued pursuant to a defective corporate act ratified in accordance with this subchapter and described by the resolutions adopted under Sections 21.903 and 21.904 may not be considered void or voidable and is considered to be an identical share or fraction of a share outstanding as of the time it was purportedly issued.
Added by Acts 2015, 84th Leg., R.S., Ch. 32 (S.B. 860), Sec. 30, eff. September 1, 2015.
Amended by:
Acts 2017, 85th Leg., R.S., Ch. 75 (S.B. 1518), Sec. 23, eff. September 1, 2017.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 21 - For-Profit Corporations › Subchapter R. Ratification of Defective Corporate Acts or Shares; Proceedings › Section 21.912. Valid Shares or Putative Shares

Sec. 21.912.  VALID SHARES OR PUTATIVE SHARES.  In the absence of actual fraud in the transaction, the judgment of the board of directors of a corporation that shares of the corporation are valid shares or putative shares is conclusive, unless otherwise determined by the district court in a proceeding brought under Section 21.914.
Added by Acts 2015, 84th Leg., R.S., Ch. 32 (S.B. 860), Sec. 30, eff. September 1, 2015.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 21 - For-Profit Corporations › Subchapter R. Ratification of Defective Corporate Acts or Shares; Proceedings › Section 21.913. Ratification Procedures or Court Proceedings Concerning Validation Not Exclusive

Sec. 21.913.  RATIFICATION PROCEDURES OR COURT PROCEEDINGS CONCERNING VALIDATION NOT EXCLUSIVE.  (a)  Ratification of an act or transaction under this subchapter or validation of an act or transaction as provided by Sections 21.914 through 21.917 is not the exclusive means of ratifying or validating any act or transaction taken by or on behalf of the corporation, including any defective corporate act or any issuance of putative shares or other shares, or of adopting or endorsing any act or transaction taken by or in the name of the corporation before the corporation exists.
(b)  The absence or failure of ratification of an act or transaction in accordance with this subchapter or of validation of an act or transaction as provided by Sections 21.914 through 21.917 does not, of itself, affect the validity or effectiveness of any act or transaction or the issuance of any shares properly ratified under common law or otherwise, nor does it create a presumption that any such act or transaction is or was a defective corporate act or that those shares are void or voidable.
Added by Acts 2015, 84th Leg., R.S., Ch. 32 (S.B. 860), Sec. 30, eff. September 1, 2015.
Amended by:
Acts 2017, 85th Leg., R.S., Ch. 75 (S.B. 1518), Sec. 26, eff. September 1, 2017.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 21 - For-Profit Corporations › Subchapter R. Ratification of Defective Corporate Acts or Shares; Proceedings › Section 21.915. Exclusive Jurisdiction

Sec. 21.915.  EXCLUSIVE JURISDICTION.  The district court has exclusive jurisdiction to hear and determine any action brought under Section 21.914.
Added by Acts 2015, 84th Leg., R.S., Ch. 32 (S.B. 860), Sec. 30, eff. September 1, 2015.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 21 - For-Profit Corporations › Subchapter R. Ratification of Defective Corporate Acts or Shares; Proceedings › Section 21.916. Service

Sec. 21.916.  SERVICE.  (a)  Service of an application filed under Section 21.914 on the registered agent of a corporation or in any other manner permitted by applicable law is considered to be service on the corporation, and no other party need be joined in order for the district court to adjudicate the matter.
(b)  If an action is brought by a corporation under Section 21.914, the district court may require that notice of the action be provided to other persons identified by the court and permit those other persons to intervene in the action.
Added by Acts 2015, 84th Leg., R.S., Ch. 32 (S.B. 860), Sec. 30, eff. September 1, 2015.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 21 - For-Profit Corporations › Subchapter R. Ratification of Defective Corporate Acts or Shares; Proceedings › Section 21.917. Statute of Limitations

Sec. 21.917.  STATUTE OF LIMITATIONS.  (a)  This section does not apply to:
(1)  an action asserting that a ratification was not accomplished in accordance with this subchapter; or
(2)  any person to whom notice of the ratification was not given as required by Sections 21.906 and 21.911.
(b)  Notwithstanding any other provision of this subchapter:
(1)  an action claiming that a defective corporate act or putative shares are void or voidable due to a failure of authorization identified in the resolutions adopted in accordance with Section 21.903 may not be filed in or must be dismissed by any court after the applicable validation effective time; and
(2)  an action claiming that a court of appropriate jurisdiction, in its discretion, should declare that a ratification in accordance with this subchapter not take effect or that the ratification take effect only on certain conditions may not be filed with the court after the expiration of the 120th day after the later of the validation effective time or the time that any notice required to be given under Section 21.911 is given with respect to the ratification.
(c)  Except as otherwise provided by a corporation's governing documents, for purposes of this section, notice under Section 21.911 that is:
(1)  mailed is considered to be given on the date the notice is deposited in the United States mail with postage paid in an envelope addressed to the holder at the holder's address appearing or most recently appearing, as appropriate, in the records of the corporation; and
(2)  transmitted by facsimile or electronic message is considered to be given when the facsimile or electronic message is transmitted to a facsimile number or an electronic message address provided by the holder, or to which the holder consents, for the purpose of receiving notice.
Added by Acts 2015, 84th Leg., R.S., Ch. 32 (S.B. 860), Sec. 30, eff. September 1, 2015.
Amended by:
Acts 2017, 85th Leg., R.S., Ch. 75 (S.B. 1518), Sec. 27, eff. September 1, 2017.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 21 - For-Profit Corporations › Subchapter S. Public Benefit Corporations › Section 21.951. Law Applicable to Public Benefit Corporations; Formation

Sec. 21.951.  LAW APPLICABLE TO PUBLIC BENEFIT CORPORATIONS; FORMATION.  (a)  A for-profit corporation may elect under Section 3.007(e) to be a public benefit corporation that is governed by this subchapter.
(b)  If a corporation elects to be a public benefit corporation, the corporation is subject to the other provisions of this chapter and other provisions of this code applicable to for-profit corporations.
(c)  To the extent of a conflict between this subchapter and another provision of this chapter or another provision of this code applicable to for-profit corporations, this subchapter controls.
Added by Acts 2017, 85th Leg., R.S., Ch. 776 (H.B. 3488), Sec. 4, eff. September 1, 2017.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 21 - For-Profit Corporations › Subchapter S. Public Benefit Corporations › Section 21.952. Definitions

Sec. 21.952.  DEFINITIONS.  In this subchapter:
(1)  "Public benefit" means a positive effect, or a reduction of a negative effect, on one or more categories of persons, entities, communities, or interests, other than shareholders in their capacities as shareholders of the corporation, including effects of an artistic, charitable, cultural, economic, educational, environmental, literary, medical, religious, scientific, or technological nature.
(2)  "Public benefit corporation" means a domestic for-profit corporation that elects under Section 3.007(e) to be a public benefit corporation governed by this subchapter.
(3)  "Public benefit provisions" means the provisions of a certificate of formation that are required by Section 3.007(e) and this subchapter.
Added by Acts 2017, 85th Leg., R.S., Ch. 776 (H.B. 3488), Sec. 4, eff. September 1, 2017.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 21 - For-Profit Corporations › Subchapter S. Public Benefit Corporations › Section 21.953. Purpose of Public Benefit Corporation; Name of Corporation

Sec. 21.953.  PURPOSE OF PUBLIC BENEFIT CORPORATION; NAME OF CORPORATION.  (a)  A public benefit corporation is a domestic for-profit corporation that is intended to produce a public benefit or benefits and to operate in a responsible and sustainable manner.
(b)  To accomplish the purpose of the corporation described by Subsection (a), a public benefit corporation shall be managed in a manner that balances:
(1)  the shareholders' pecuniary interests;
(2)  the best interests of those persons materially affected by the corporation's conduct; and
(3)  the public benefit or benefits specified in the corporation's certificate of formation.
(c)  The name of the public benefit corporation specified in its certificate of formation may contain the words "public benefit corporation," the abbreviation "P.B.C.," or the designation "PBC."  If the name does not contain those words or that abbreviation or designation, before the issuance of unissued shares or the disposition of treasury shares and except as provided by Subsection (d), notice that the corporation is a public benefit corporation shall be given to any person:
(1)  to whom the unissued shares are issued; or
(2)  who acquires the treasury shares.
(d)  Notice is not required to be provided under Subsection (c) if:
(1)  the issuance or disposal of shares described by that subsection is under an offering registered under the Securities Act of 1933 (15 U.S.C. Section 77a et seq.); or
(2)  at the time of the issuance or disposal of  shares described by that subsection, the corporation has a class of securities registered under the Securities Exchange Act of 1934 (15 U.S.C. Section 78a et seq.).
(e)  Section 5.054(a) does not apply to a public benefit corporation that includes in its name the words, abbreviation, or designation permitted by Subsection (c).
Added by Acts 2017, 85th Leg., R.S., Ch. 776 (H.B. 3488), Sec. 4, eff. September 1, 2017.
Amended by:
Acts 2019, 86th Leg., R.S., Ch. 665 (S.B. 1971), Sec. 14, eff. September 1, 2019.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 21 - For-Profit Corporations › Subchapter S. Public Benefit Corporations › Section 21.955. Stock Certificates; Notices Regarding Uncertificated Stock

Sec. 21.955.  STOCK CERTIFICATES; NOTICES REGARDING UNCERTIFICATED STOCK.  (a)  A stock certificate issued by a public benefit corporation must note conspicuously that the corporation is a public benefit corporation governed by this subchapter.
(b)  A notice sent to any person under Section 3.205 must state conspicuously that the corporation is a public benefit corporation governed by this subchapter.
Added by Acts 2017, 85th Leg., R.S., Ch. 776 (H.B. 3488), Sec. 4, eff. September 1, 2017.
Amended by:
Acts 2019, 86th Leg., R.S., Ch. 665 (S.B. 1971), Sec. 15, eff. September 1, 2019.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 21 - For-Profit Corporations › Subchapter S. Public Benefit Corporations › Section 21.956. Duties of Directors

Sec. 21.956.  DUTIES OF DIRECTORS.  (a)  The board of directors of a public benefit corporation shall manage or direct the business and affairs of the corporation in a manner that balances:
(1)  the pecuniary interests of the shareholders;
(2)  the best interests of those persons materially affected by the corporation's conduct; and
(3)  the specific public benefit or benefits specified in the corporation's certificate of formation.
(b)  A director of a public benefit corporation does not, by virtue of the public benefit provisions included in the certificate of formation or by virtue of the purpose and requirements of Sections 21.953(a) and (b), owe any duty to any person because of:
(1)  any interest the person has in the public benefit or benefits specified in the certificate of formation; or
(2)  any interest materially affected by the corporation's conduct.
(c)  With respect to a decision implicating the balance requirement of Subsection (a), a director of a public benefit corporation is considered to have satisfied the director's duties to shareholders and the corporation if the director's decision is both informed and disinterested and is not a decision that no person of ordinary, sound judgment would approve.
(d)  The certificate of formation of a public benefit corporation may include a provision that any disinterested failure of a director to satisfy the requirements of this section does not, for the purposes of the applicable provisions of this code, constitute an act or omission not in good faith or a breach of the duty of loyalty.
Added by Acts 2017, 85th Leg., R.S., Ch. 776 (H.B. 3488), Sec. 4, eff. September 1, 2017.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 21 - For-Profit Corporations › Subchapter S. Public Benefit Corporations › Section 21.957. Periodic Statements

Sec. 21.957.  PERIODIC STATEMENTS.  (a)  A public benefit corporation shall include in each notice of a meeting of shareholders a statement to the effect that the corporation is a public benefit corporation governed by this subchapter.
(b)  A public benefit corporation, at least biennially, shall provide to the corporation's shareholders a statement pertaining to the corporation's promotion of the public benefit or benefits specified in the corporation's certificate of formation and promotion of the best interests of those materially affected by the corporation's conduct.  The statement must include:
(1)  the objectives the board of directors has established to promote the public benefit or benefits and interests;
(2)  the standards the board of directors has adopted to measure the corporation's progress in promoting the public benefit or benefits and interests;
(3)  objective factual information based on those standards regarding the corporation's success in meeting the objectives for promoting the public benefit or benefits and interests; and
(4)  an assessment of the corporation's success in meeting the objectives and promoting the public benefit or benefits and interests.
(c)  The certificate of formation or bylaws of a public benefit corporation may require that the corporation:
(1)  provide the statement required by Subsection (b) more frequently than biennially; or
(2)  make the statement required by Subsection (b) available to the public.
Added by Acts 2017, 85th Leg., R.S., Ch. 776 (H.B. 3488), Sec. 4, eff. September 1, 2017.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 21 - For-Profit Corporations › Subchapter S. Public Benefit Corporations › Section 21.958. Derivative Suits

Sec. 21.958.  DERIVATIVE SUITS.  (a)  In this section, "shareholder"  means:
(1)  shareholders of a public benefit corporation that own, individually or collectively, at least two percent of the corporation's outstanding shares; or
(2)  shareholders of a public benefit corporation the shares of which are listed on a national securities exchange that own at least the lesser of:
(A)  the percentage of shares described by Subdivision (1); or
(B)  shares whose market value is at least $2 million.
(b)  A shareholder of a public benefit corporation may maintain a derivative action on behalf of the corporation to enforce compliance with the requirements of Section 21.956(a).
Added by Acts 2017, 85th Leg., R.S., Ch. 776 (H.B. 3488), Sec. 4, eff. September 1, 2017.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 21 - For-Profit Corporations › Subchapter S. Public Benefit Corporations › Section 21.959. No Effect on Other Corporations

Sec. 21.959.  NO EFFECT ON OTHER CORPORATIONS.  Except as provided by Section 21.954, this subchapter does not apply to a corporation that is not a public benefit corporation.
Added by Acts 2017, 85th Leg., R.S., Ch. 776 (H.B. 3488), Sec. 4, eff. September 1, 2017.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 22 - Nonprofit Corporations › Subchapter A. General Provisions › Section 22.001. Definitions

Sec. 22.001.  DEFINITIONS.  In this chapter:
(1)  "Board of directors" means the group of persons vested with the management of the affairs of the corporation, regardless of the name used to designate the group.
(2)  "Bylaws" means the rules adopted to regulate or manage the corporation, regardless of the name used to designate the rules.
(3)  "Corporation" or "domestic corporation" means a domestic nonprofit corporation subject to this chapter.
(3-a)  "Director" means a person who is a member of the board of directors, regardless of the name or title used to designate the person.  The term does not include a person designated as a director of the corporation, or as an ex officio, honorary, or other type of director of the corporation if the person is not entitled to vote as a director.
(4)  "Foreign corporation" means a foreign nonprofit corporation.
(5)  "Nonprofit corporation" means a corporation no part of the income of which is distributable to a member, director, or officer of the corporation, except as provided by Section 22.054.
(6)  "Ordinary care" means the care that an ordinarily prudent person in a similar position would exercise under similar circumstances.
Acts 2003, 78th Leg., ch. 182, Sec. 1, eff. Jan. 1, 2006.
Amended by:
Acts 2015, 84th Leg., R.S., Ch. 121 (S.B. 1233), Sec. 1, eff. May 23, 2015.
Acts 2019, 86th Leg., R.S., Ch. 665 (S.B. 1971), Sec. 16, eff. September 1, 2019.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 22 - Nonprofit Corporations › Subchapter A. General Provisions › Section 22.002. Meetings by Remote Communications Technology

Sec. 22.002.  MEETINGS BY REMOTE COMMUNICATIONS TECHNOLOGY.  A meeting of the members of a corporation, the board of directors of a corporation, or any committee designated by the board of directors of a corporation may be held by means of a conference telephone or similar communications equipment, another suitable electronic communications system, including videoconferencing technology or the Internet, or any combination of those means, in accordance with Section 6.002.
Acts 2003, 78th Leg., ch. 182, Sec. 1, eff. Jan. 1, 2006.
Amended by:
Acts 2019, 86th Leg., R.S., Ch. 665 (S.B. 1971), Sec. 17, eff. September 1, 2019.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 22 - Nonprofit Corporations › Subchapter B. Purposes and Powers › Section 22.051. General Purposes

Sec. 22.051.  GENERAL PURPOSES.  A nonprofit corporation may be formed for any lawful purpose or purposes not expressly prohibited under this chapter or Chapter 2, including any purpose described by Section 2.002.
Acts 2003, 78th Leg., ch. 182, Sec. 1, eff. Jan. 1, 2006.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 22 - Nonprofit Corporations › Subchapter B. Purposes and Powers › Section 22.052. Dental Health Service Corporation

Sec. 22.052.  DENTAL HEALTH SERVICE CORPORATION.  (a)  A charitable corporation may be formed to operate a dental health service corporation that manages and coordinates the relationship between a dentist who contracts to perform dental services and a patient who will receive the services as a member of a group that contracted with the dental health service corporation to provide dental care to group members.
(b)  The certificate of formation for a charitable corporation formed under this section must have attached as an exhibit:
(1)  an affidavit of the organizer or organizers stating:
(A)  that not less than 30 percent of the dentists legally engaged in the practice of dentistry in this state have signed a contract to perform the required dental services for a period of at least one year after incorporation;  and
(B)  the names and addresses of those dentists;  and
(2)  a certification by the State Board of Dental Examiners that:
(A)  the applicants are reputable residents of this state of good moral character;  and
(B)  the corporation will be in the best interest of the public health.
(c)  A corporation formed under this section must have at least 12 directors, including 9 directors who are licensed to practice dentistry in this state and are actively engaged in the practice of dentistry in this state.
(d)  A corporation formed under this section shall maintain as participating or contracting dentists at least 30 percent of the number of dentists actually engaged in the practice of dentistry in this state.  The corporation shall file annually in September with the State Board of Dental Examiners the name and address of each participating or contracting dentist.
(e)  A corporation formed under this section may not:
(1)  prevent a patient from selecting the licensed dentist of the patient's choice to provide dental services to the patient;
(2)  deny a licensed dentist the right to participate as a contracting dentist to perform the dental services contracted for by the patient;
(3)  discriminate among patients or licensed dentists regarding payment or reimbursement for the cost of performing dental services;  or
(4)  authorize any person to regulate, interfere with, or intervene in any manner in the diagnosis or treatment provided by a licensed dentist to a patient.
(f)  A corporation formed under this section may require the attending dentist to provide a narrative oral or written description of the dental services provided to determine benefits or provide proof of treatment.  The corporation may request but may not require diagnostic aids used in the course of treatment.
Acts 2003, 78th Leg., ch. 182, Sec. 1, eff. Jan. 1, 2006.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 22 - Nonprofit Corporations › Subchapter B. Purposes and Powers › Section 22.053. Dividends Prohibited

Sec. 22.053.  DIVIDENDS PROHIBITED.  Except as provided by Section 22.054, a dividend may not be paid to, and no part of the income of a corporation may be distributed to, the corporation's members, directors, or officers.
Acts 2003, 78th Leg., ch. 182, Sec. 1, eff. Jan. 1, 2006.
Amended by:
Acts 2015, 84th Leg., R.S., Ch. 121 (S.B. 1233), Sec. 2, eff. May 23, 2015.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 22 - Nonprofit Corporations › Subchapter B. Purposes and Powers › Section 22.054. Authorized Benefits and Distributions

Sec. 22.054.  AUTHORIZED BENEFITS AND DISTRIBUTIONS.  A corporation may:
(1)  pay compensation in a reasonable amount to the members, directors, or officers of the corporation for services provided;
(2)  confer benefits on the corporation's members in conformity with the corporation's purposes;
(3)  make distributions to the corporation's members on winding up and termination to the extent authorized by this chapter; and
(4)  make distributions of its income to the corporation's members who are nonprofit corporations organized under this code and who are exempt from income taxation under Section 501(a), Internal Revenue Code of 1986, by being listed under Section 501(c)(3) of that code, if:
(A)  the distributions are made in accordance with the purpose or purposes of the corporation as stated in the certificate of formation and with the fiduciary responsibilities of the board of directors, including the duty to safeguard restricted funds for their intended purposes; and
(B)  after the distributions are complete:
(i)  the corporation would be able to pay the corporation's debts as they become due in the usual course of its activities; and
(ii)  the corporation's total assets would at least equal the sum of its total liabilities.
Acts 2003, 78th Leg., ch. 182, Sec. 1, eff. Jan. 1, 2006.
Amended by:
Acts 2015, 84th Leg., R.S., Ch. 121 (S.B. 1233), Sec. 3, eff. May 23, 2015.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 22 - Nonprofit Corporations › Subchapter B. Purposes and Powers › Section 22.055. Power to Assist Employee or Officer

Sec. 22.055.  POWER TO ASSIST EMPLOYEE OR OFFICER.  (a)  A corporation may lend money to or otherwise assist an employee or officer of the corporation, but not a director, if the loan or assistance may reasonably be expected to directly or indirectly benefit the corporation.
(b)  A loan made to an officer must be:
(1)  made for the purpose of financing the officer's principal residence;  or
(2)  set in an original principal amount that does not exceed:
(A)  100 percent of the officer's annual salary, if the loan is made before the first anniversary of the officer's employment;  or
(B)  50 percent of the officer's annual salary, if the loan is made in any subsequent year.
Acts 2003, 78th Leg., ch. 182, Sec. 1, eff. Jan. 1, 2006.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 22 - Nonprofit Corporations › Subchapter B. Purposes and Powers › Section 22.056. Health Organization Corporation

Sec. 22.056.  HEALTH ORGANIZATION CORPORATION.  (a)  Doctors of medicine and osteopathy licensed by the Texas Medical Board, podiatrists licensed by the Texas Department of Licensing and Regulation, and chiropractors licensed by the Texas Board of Chiropractic Examiners may form a corporation that is jointly owned, managed, and controlled by those practitioners to perform a professional service that falls within the scope of practice of those practitioners and consists of:
(1)  carrying out research in the public interest in medical science, medical economics, public health, sociology, or a related field;
(2)  supporting medical education in medical schools through grants or scholarships;
(3)  developing the capabilities of individuals or institutions studying, teaching, or practicing medicine, including podiatric medicine, or chiropractic;
(4)  delivering health care to the public; or
(5)  instructing the public regarding medical science, public health, hygiene, or a related matter.
(b)  When doctors of medicine, osteopathy, podiatry, and chiropractic form a corporation that is jointly owned by those practitioners, the authority of each of the practitioners is limited by the scope of practice of the respective practitioners and none can exercise control over the other's clinical authority granted by their respective licenses, either through agreements, the certificate of formation or bylaws of the corporation, directives, financial incentives, or other arrangements that would assert control over treatment decisions made by the practitioner.  The Texas Medical Board, the Texas Department of Licensing and Regulation, and the Texas Board of Chiropractic Examiners continue to exercise regulatory authority over their respective licenses.
Acts 2003, 78th Leg., ch. 182, Sec. 1, eff. Jan. 1, 2006.
Amended by:
Acts 2017, 85th Leg., R.S., Ch. 388 (S.B. 679), Sec. 1, eff. June 1, 2017.
Acts 2019, 86th Leg., R.S., Ch. 467 (H.B. 4170), Sec. 19.001, eff. September 1, 2019.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 22 - Nonprofit Corporations › Subchapter B. Purposes and Powers › Section 22.0561. Corporations Formed by Physicians and Physician Assistants

Sec. 22.0561.  CORPORATIONS FORMED BY PHYSICIANS AND PHYSICIAN ASSISTANTS.  (a)  Physicians licensed under Subtitle B, Title 3, Occupations Code, and physician assistants licensed under Chapter 204, Occupations Code, may form a corporation to perform a professional service that falls within the scope of practice of those practitioners and consists of:
(1)  carrying out research in the public interest in medical science, medical economics, public health, sociology, or a related field;
(2)  supporting medical education in medical schools through grants or scholarships;
(3)  developing the capabilities of individuals or institutions studying, teaching, or practicing medicine or acting as a physician assistant;
(4)  delivering health care to the public;  or
(5)  instructing the public regarding medical science, public health, hygiene, or a related matter.
(b)  A physician assistant may not be an officer of the corporation.
(c)  A physician assistant may not contract with or employ a physician to be a supervising physician of the physician assistant or of any physician in the corporation.
(d)  The authority of each practitioner is limited by the scope of practice of the respective practitioner.  An organizer of the entity must be a physician and ensure that a physician or physicians control and manage the entity.
(e)  Nothing in this section may be construed to allow the practice of medicine by someone not licensed as a physician under Subtitle B, Title 3, Occupations Code, or to allow a person not licensed as a physician to direct the activities of a physician in the practice of medicine.
(f)  A physician assistant or combination of physician assistants may have only a minority ownership interest in an entity created under this section. The ownership interest of an individual physician assistant may not equal or exceed the ownership interest of any individual physician owner. A physician assistant or combination of physician assistants may not interfere with the practice of medicine by a physician owner or the supervision of physician assistants by a physician owner.
(g)  The Texas Medical Board and the Texas Physician Assistant Board continue to exercise regulatory authority over their respective license holders according to applicable law.  To the extent of a conflict between Subtitle B, Title 3, Occupations Code, and Chapter 204, Occupations Code, or any rules adopted under those statutes, Subtitle B, Title 3, or a rule adopted under that subtitle controls.
Added by Acts 2011, 82nd Leg., R.S., Ch. 782 (H.B. 2098), Sec. 1, eff. June 17, 2011.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 22 - Nonprofit Corporations › Subchapter C. Formation and Governing Documents › Section 22.101. Incorporation of Certain Organizations

Sec. 22.101.  INCORPORATION OF CERTAIN ORGANIZATIONS.  A religious society, a charitable, benevolent, literary, or social association, or a church may incorporate as a corporation governed by this chapter with the consent of a majority of its members.  Those members shall authorize the organizers to execute the certificate of formation.
Acts 2003, 78th Leg., ch. 182, Sec. 1, eff. Jan. 1, 2006.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 22 - Nonprofit Corporations › Subchapter C. Formation and Governing Documents › Section 22.102. Bylaws

Sec. 22.102.  BYLAWS.  (a)  The initial bylaws of a corporation shall be adopted by the corporation's board of directors or, if the management of the corporation is vested in the corporation's members, by the members.
(b)  The bylaws may contain provisions for the regulation and management of the affairs of the corporation that are consistent with law and the certificate of formation.
(c)  The board of directors may amend or repeal the bylaws, or adopt new bylaws, unless:
(1)  this chapter or the corporation's certificate of formation wholly or partly reserves the power exclusively to the corporation's members;
(2)  the management of the corporation is vested in the corporation's members;  or
(3)  in amending, repealing, or adopting a bylaw, the members expressly provide that the board of directors may not amend or repeal the bylaw.
Acts 2003, 78th Leg., ch. 182, Sec. 1, eff. Jan. 1, 2006.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 22 - Nonprofit Corporations › Subchapter C. Formation and Governing Documents › Section 22.103. Inconsistency Between Certificate of Formation and Bylaw

Sec. 22.103.  INCONSISTENCY BETWEEN CERTIFICATE OF FORMATION AND BYLAW.  (a)  A provision of a certificate of formation of a corporation that is inconsistent with a bylaw controls over the bylaw, except as provided by Subsection (b).
(b)  A change in the number of directors by amendment to the bylaws controls over the number stated in the certificate of formation, unless the certificate of formation provides that a change in the number of directors may be made only by amendment to the certificate.
Acts 2003, 78th Leg., ch. 182, Sec. 1, eff. Jan. 1, 2006.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 22 - Nonprofit Corporations › Subchapter C. Formation and Governing Documents › Section 22.104. Organization Meeting

Sec. 22.104.  ORGANIZATION MEETING.  (a)  After the certificate of formation is filed, the board of directors named in the certificate of formation of a corporation shall hold an organization meeting of the board, either in or out of this state, at the call of the organizers or a majority of the directors to adopt bylaws and elect officers and for other purposes determined by the board at the meeting.  The organizers or directors calling the meeting shall send notice of the time and place of the meeting to each director named in the certificate of formation not later than the third day before the date of the meeting.
(b)  A first meeting of the members may be held at the call of the majority of the directors on notice provided not later than the third day before the date of the meeting.  The notice must state the purposes of the meeting.
(c)  If the management of a corporation is vested in the corporation's members, the members shall hold the organization meeting on the call of an organizer.  An organizer who calls the meeting shall:
(1)  send notice of the time and place of the meeting to each member not later than the third day before the  date of the meeting;
(2)  if the corporation is a church, make an oral announcement of the time and place of the meeting at a regularly scheduled worship service before the meeting; or
(3)  send notice of the meeting in the manner provided by the certificate of formation.
Acts 2003, 78th Leg., ch. 182, Sec. 1, eff. Jan. 1, 2006.
Amended by:
Acts 2005, 79th Leg., Ch. 64 (H.B. 1319), Sec. 66, eff. January 1, 2006.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 22 - Nonprofit Corporations › Subchapter C. Formation and Governing Documents › Section 22.105. Procedures to Adopt Amendment to Certificate of Formation by Members Having Voting Rights

Sec. 22.105.  PROCEDURES TO ADOPT AMENDMENT TO CERTIFICATE OF FORMATION BY MEMBERS HAVING VOTING RIGHTS.  (a)  Except as provided by Section 22.107(b), to amend the certificate of formation of a corporation with members having voting rights, the board of directors of the corporation must adopt a resolution specifying the proposed amendment and directing that the amendment be submitted to a vote at an annual or special meeting of the members having voting rights.
(b)  Written notice containing the proposed amendment or a summary of the changes to be effected by the amendment shall be given to each member entitled to vote at the meeting within the time and in the manner provided by this chapter for giving notice of a meeting of members.
(c)  The proposed amendment shall be adopted on receiving the vote required by Section 22.164.
Acts 2003, 78th Leg., ch. 182, Sec. 1, eff. Jan. 1, 2006.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 22 - Nonprofit Corporations › Subchapter C. Formation and Governing Documents › Section 22.106. Procedures to Adopt Amendment to Certificate of Formation by Managing Members

Sec. 22.106.  PROCEDURES TO ADOPT AMENDMENT TO CERTIFICATE OF FORMATION BY MANAGING MEMBERS.  (a)  To be approved, a proposed amendment to the certificate of formation of a corporation the management of the affairs of which is vested in the corporation's members under Section 22.202 must be submitted to a vote at an annual, regular, or special meeting of the members.
(b)  Except as otherwise provided by the certificate of formation or bylaws, notice containing the proposed amendment or a summary of the changes to be effected by the amendment shall be given to the members within the time and in the manner provided by this chapter for giving notice of a meeting of members.
(c)  The proposed amendment shall be adopted on receiving the vote required by Section 22.164.
Acts 2003, 78th Leg., ch. 182, Sec. 1, eff. Jan. 1, 2006.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 22 - Nonprofit Corporations › Subchapter C. Formation and Governing Documents › Section 22.107. Procedures to Adopt Amendment to Certificate of Formation by Board of Directors

Sec. 22.107.  PROCEDURES TO ADOPT AMENDMENT TO CERTIFICATE OF FORMATION BY BOARD OF DIRECTORS.  (a)  If a corporation has no members or has no members with voting rights, or in the case of an amendment under Subsection (b), an amendment to the corporation's certificate of formation shall be adopted at a meeting of the board of directors on receiving the vote of directors required by Section 22.164.
(b)  Except as otherwise provided by the certificate of formation, the board of directors of a corporation with members having voting rights may, without member approval, adopt amendments to the certificate of formation to:
(1)  extend the duration of the corporation if the corporation was incorporated when limited duration was required by law;
(2)  delete the names and addresses of the initial directors;
(3)  delete the name and address of the initial registered agent or registered office, if a statement of change is on file with the secretary of state;  or
(4)  change the corporate name by:
(A)  substituting the word "corporation," "incorporated," "company," or "limited," or the abbreviation "corp.," "inc.," "co.," or "ltd.," for a similar word or abbreviation in the name;  or
(B)  adding, deleting, or changing a geographical attribution to the name.
Acts 2003, 78th Leg., ch. 182, Sec. 1, eff. Jan. 1, 2006.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 22 - Nonprofit Corporations › Subchapter C. Formation and Governing Documents › Section 22.108. Number of Amendments Subject to Vote at Meeting

Sec. 22.108.  NUMBER OF AMENDMENTS SUBJECT TO VOTE AT MEETING.  Any number of amendments to the corporation's certificate of formation may be submitted to and voted on by a corporation's members at any one meeting of the members.
Acts 2003, 78th Leg., ch. 182, Sec. 1, eff. Jan. 1, 2006.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 22 - Nonprofit Corporations › Subchapter C. Formation and Governing Documents › Section 22.109. Restated Certificate of Formation

Sec. 22.109.  RESTATED CERTIFICATE OF FORMATION.  (a)  A corporation may adopt a restated certificate of formation as provided by Subchapter B, Chapter 3, by following the same procedure to amend its certificate of formation provided by Sections 22.104-22.107, except that:
(1)  member approval is required only if the restated certificate of formation contains an amendment; and
(2)  the members may consent in writing, or the organizers of a corporation may adopt a resolution, to authorize a restated certificate of formation that contains an amendment to cancel an event requiring winding up in accordance with Section 22.302(1)(B) or 22.302(2), as applicable.
(b)  A person shall file a restated certificate of formation as provided by Chapter 4, and the restated certificate of formation takes effect as provided by Subchapter B, Chapter 3.
Added by Acts 2005, 79th Leg., Ch. 64 (H.B. 1319), Sec. 67, eff. January 1, 2006.
Amended by:
Acts 2015, 84th Leg., R.S., Ch. 32 (S.B. 860), Sec. 27, eff. September 1, 2015.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 22 - Nonprofit Corporations › Subchapter D. Members › Section 22.151. Members

Sec. 22.151.  MEMBERS.  (a)  A corporation may have one or more classes of members or may have no members.
(b)  If the corporation has one or more classes of members, the corporation's certificate of formation or bylaws must include:
(1)  a designation of each class;
(2)  the manner of the election or appointment of the members of each class;  and
(3)  the qualifications and rights of the members of each class.
(c)  A corporation may issue a certificate, card, or other instrument evidencing membership rights, voting rights, or ownership rights as authorized by the certificate of formation or bylaws.
Acts 2003, 78th Leg., ch. 182, Sec. 1, eff. Jan. 1, 2006.
2023 Texas Statutes › Business Organizations Code › Title 2 - Corporations › Chapter 22 - Nonprofit Corporations › Subchapter D. Members › Section 22.152. Immunity From Liability

Sec. 22.152.  IMMUNITY FROM LIABILITY.  The members of a corporation are not personally liable for a debt, liability, or obligation of the corporation.
Acts 2003, 78th Leg., ch. 182, Sec. 1, eff. Jan. 1, 2006.