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Texas Statutes (Last Updated: January 4, 2014) |
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BUSINESS ORGANIZATIONS CODE |
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Title 2. CORPORATIONS |
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Chapter 21. FOR-PROFIT CORPORATIONS |
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Subchapter L. DERIVATIVE PROCEEDINGS |
Sec. 21.563. CLOSELY HELD CORPORATION
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(a) In this section, "closely held corporation" means a corporation that has:
(1) fewer than 35 shareholders; and
(2) no shares listed on a national securities exchange or regularly quoted in an over-the-counter market by one or more members of a national securities association.
(b) Sections 21.552-21.559 do not apply to a closely held corporation.
(c) If justice requires:
(1) a derivative proceeding brought by a shareholder of a closely held corporation may be treated by a court as a direct action brought by the shareholder for the shareholder's own benefit; and
(2) a recovery in a direct or derivative proceeding by a shareholder may be paid directly to the plaintiff or to the corporation if necessary to protect the interests of creditors or other shareholders of the corporation.