This By-Laws document contains the following information: the name and location of the corporation, the shareholders, and the duties of the officers.
Purpose Of Bylaws For Corporations In Texas
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“Piercing the corporate veil” allows parties undertaking business litigation to navigate around this limited liability. Specifically, the phrase details the actions afforded to certain individuals should a business representative create a subsidiary to otherwise take on liability for consumer losses.
Statutory Preemptive Rights. (a) If the shareholders of a corporation have a preemptive right under this subchapter, the shareholders have a preemptive right to acquire proportional amounts of the corporation's unissued or treasury shares on the decision of the corporation's board of directors to issue the shares.
The secretary of state does not maintain the bylaws or tax exempt filings of any nonprofit organization. Some organizations that have obtained tax-exempt status from the Internal Revenue Service are required to make certain documents available to the public.
Under Article 2.21 of the Texas Business Corporation Act (TBCA), for example, shareholders or affiliates cannot be held liable for a corporation's contractual obligations unless they caused the corporation to be used to perpetrate “an actual fraud… primarily for the purpose of personal benefit”.
Sec. 22.153. ANNUAL MEETING. (a) Except as provided by Subsection (b), a corporation shall hold an annual meeting of the members at a time that is stated in or determined in ance with the corporation's bylaws.
Preparing and filing your articles of incorporation is the first step in starting your business or nonprofit corporation. Approval of this document secures your corporate name and creates the legal entity of the corporation.
Alter Ego Liability in Texas The alter ego theory allows courts to hold individuals accountable for using a corporation to engage in fraudulent activities and evade liability.
Corporations are legally required to adopt bylaws in Texas – Section 21.057 of the Texas Business Organizations Code states that the board of directors of a corporation shall adopt initial bylaws. So, if your company gets caught in a legal battle without bylaws, you could face some serious legal consequences.
They are necessary. Your nonprofit does not need to file bylaws with the Texas Secretary of State, but they are required to obtain tax-exempt status with the IRS.
The following are Texas's requirements for directors of corporations: Minimum number. Corporations must have one or more directors.