Texas Agriculture Code 54.005 – Capital Stock
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(a) The incorporators or the board of directors of a corporation formed under this chapter may divide the corporation’s capital stock into preferred and common stock.
(b) If preferred stock is to be issued, the articles of incorporation must state:
(1) the amount of preferred stock that the corporation may issue;
(2) the conditions and procedure for the payment of dividends on preferred stock;
(3) the rate at which preferred stock dividends are paid; and
(4) the conditions and procedure for the retirement of preferred and common stock.
Terms Used In Texas Agriculture Code 54.005
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
(c) A corporation may not pay dividends on its common stock until it has fully paid dividends on its preferred stock at the rate provided by its articles of incorporation.