Texas Business Organizations Code 2.101 – General Powers
Terms Used In Texas Business Organizations Code 2.101
- Affiliate: means a person who controls, is controlled by, or is under common control with another person. See Texas Business Organizations Code 1.002
- Associate: when used to indicate a relationship with a person, means:
(A) a domestic or foreign entity or organization for which the person:
(i) is an officer or governing person; or
(ii) beneficially owns, directly or indirectly, either individually or through an affiliate, 10 percent or more of a class of voting ownership interests or similar securities of the entity or organization;
(B) a trust or estate in which the person has a substantial beneficial interest or for which the person serves as trustee or in a similar fiduciary capacity;
(C) the person's spouse or a relative of the person related by consanguinity or affinity who resides with the person; or
(D) a governing person or an affiliate or officer of the person. See Texas Business Organizations Code 1.002 - Business: means a trade, occupation, profession, or other commercial activity. See Texas Business Organizations Code 1.002
- Certificate of formation: means :
(A) the document required to be filed with the filing officer under Chapter 3 to form a filing entity; and
(B) if appropriate, a restated certificate of formation and all amendments of an original or restated certificate of formation. See Texas Business Organizations Code 1.002 - Domestic: means , with respect to an entity, that the entity is formed under this code or the entity's internal affairs are governed by this code. See Texas Business Organizations Code 1.002
- Domestic entity: means an organization formed under or the internal affairs of which are governed by this code. See Texas Business Organizations Code 1.002
- Entity: means a domestic entity or foreign entity. See Texas Business Organizations Code 1.002
- Governing authority: means a person or group of persons who are entitled to manage and direct the affairs of an entity under this code and the governing documents of the entity, except that if the governing documents of the entity or this code divide the authority to manage and direct the affairs of the entity among different persons or groups of persons according to different matters, "governing authority" means the person or group of persons entitled to manage and direct the affairs of the entity with respect to a matter under the governing documents of the entity or this code. See Texas Business Organizations Code 1.002
- Governing documents: means :
(A) in the case of a domestic entity:
(i) the certificate of formation for a domestic filing entity or the document or agreement under which a domestic nonfiling entity is formed; and
(ii) the other documents or agreements adopted by the entity under this code to govern the formation or the internal affairs of the entity; or
(B) in the case of a foreign entity, the instruments, documents, or agreements adopted under the law of its jurisdiction of formation to govern the formation or the internal affairs of the entity. See Texas Business Organizations Code 1.002 - Individual: means a natural person. See Texas Business Organizations Code 1.002
- Law: means , unless the context requires otherwise, both statutory and common law. See Texas Business Organizations Code 1.002
- Lease: A contract transferring the use of property or occupancy of land, space, structures, or equipment in consideration of a payment (e.g., rent). Source: OCC
- Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
- Manager: means a person designated as a manager of a limited liability company that is not managed by members of the company. See Texas Business Organizations Code 1.002
- Member: means :
(A) in the case of a limited liability company, a person who has become, and has not ceased to be, a member in the limited liability company as provided by its governing documents or this code;
(B) in the case of a nonprofit corporation, a person who has membership rights in the nonprofit corporation under its governing documents;
(C) in the case of a cooperative association, a member of a nonshare or share association;
(D) in the case of a nonprofit association, a person who has membership rights in the nonprofit association under its governing documents; or
(E) in the case of a professional association, a person who has membership rights in the professional association under its governing documents. See Texas Business Organizations Code 1.002 - Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
- Organization: means a corporation, limited or general partnership, limited liability company, business trust, real estate investment trust, joint venture, joint stock company, cooperative, association, bank, insurance company, credit union, savings and loan association, or other organization, regardless of whether the organization is for-profit, nonprofit, domestic, or foreign. See Texas Business Organizations Code 1.002
- Partner: means a limited partner or general partner. See Texas Business Organizations Code 1.002
- Person: means an individual or a corporation, partnership, limited liability company, business trust, trust, association, or other organization, estate, government or governmental subdivision or agency, or other legal entity, or a protected series or registered series of a domestic limited liability company or foreign entity. See Texas Business Organizations Code 1.002
- Property: includes tangible and intangible property and an interest in that property. See Texas Business Organizations Code 1.002
Except as otherwise provided by this code, a domestic entity has the same powers as an individual to take action necessary or convenient to carry out its business and affairs. Except as otherwise provided by this code, the powers of a domestic entity include the power to:
(1) sue, be sued, and defend suit in the entity’s business name;
(2) have and alter a seal and use the seal or a facsimile of it by impressing, affixing, or reproducing it;
(3) acquire, receive, own, hold, improve, use, and deal in and with property or an interest in property;
(4) sell, convey, mortgage, pledge, lease, exchange, and otherwise dispose of property;
(5) make contracts and guarantees;
(6) incur liabilities, borrow money, issue notes, bonds, or other obligations, which may be convertible into, or include the option to purchase, other securities or ownership interests in the entity, and secure its obligations by mortgaging or pledging its property, franchises, or income;
(7) lend money, invest its funds, and receive and hold property as security for repayment;
(8) acquire its own bonds, debentures, or other evidences of indebtedness or obligations;
(9) acquire its own ownership interests, regardless of whether redeemable, and hold the ownership interests as treasury ownership interests or cancel or dispose of the ownership interests;
(10) be a promoter, organizer, owner, partner, member, associate, or manager of an organization;
(11) acquire, receive, own, hold, vote, use, pledge, and dispose of ownership interests in or securities issued by another person;
(12) conduct its business, locate its offices, and exercise the powers granted by this code to further its purposes, in or out of this state;
(13) lend money to, and otherwise assist, its managerial officials, owners, members, or employees as necessary or appropriate if the loan or assistance reasonably may be expected to benefit, directly or indirectly, the entity;
(14) elect or appoint officers and agents of the entity, establish the length of their terms, define their duties, and fix their compensation;
(15) pay pensions and establish pension plans, pension trusts, profit-sharing plans, bonus plans, and incentive plans for managerial officials, owners, members, or employees or former managerial officials, owners, members, or employees;
(16) indemnify and maintain liability insurance for managerial officials, owners, members, employees, and agents of the entity or the entity’s affiliate;
(17) adopt and amend governing documents for managing the affairs of the entity subject to applicable law;
(18) make donations for the public welfare or for a charitable, scientific, or educational purpose;
(19) voluntarily wind up its business and activities and terminate its existence;
(20) transact business or take action that will aid governmental policy;
(21) renounce, in its certificate of formation or by action of its governing authority, an interest or expectancy of the entity in, or an interest or expectancy of the entity in being offered an opportunity to participate in, specified business opportunities or a specified class or category of business opportunities presented to the entity or one or more of its managerial officials or owners; and
(22) take other action necessary or appropriate to further the purposes of the entity.