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Texas Business Organizations Code - BUS ORG § 21.311. Limitations on Share Dividends

Current as of January 01, 2024 | Updated by Findlaw Staff

A corporation may not pay a share dividend in authorized but unissued shares of any class if:

(1) the surplus of the corporation is less than the amount required by Section 21.313 to be transferred to stated capital at the time the share dividend is made; or

(2) the share dividend will be made to a holder of shares of any other class or series, unless:

(A) the corporation's certificate of formation provides for the dividend; or

(B) the share dividend is authorized by the holders of at least a majority of the outstanding shares of the class or series in which the share dividend is to be made.

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Cite this article: FindLaw.com - Texas Business Organizations Code - BUS ORG § 21.311. Limitations on Share Dividends - last updated January 01, 2024 | https://codes.findlaw.com/tx/business-organizations-code/bus-org-sect-21-311/

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