Texas § BO.21.756 - JUDICIAL PROCEEDING TO ENFORCE CLOSE CORPORATION PROVISION

§ BO.21.756. JUDICIAL PROCEEDING TO ENFORCE CLOSE CORPORATION PROVISION

JUDICIAL PROCEEDING TO ENFORCE CLOSE CORPORATION PROVISION. (a) In a judicial proceeding under this section, a court shall enforce a close corporation provision without regard to whether there is an adequate remedy at law. (b) The court may enforce a close corporation provision by injunction, specific performance, or other relief the court determines to be fair and equitable under the circumstances, including: (1) damages instead of or in addition to specific enforcement; (2) the appointment of a provisional director or custodian; (3) the appointment of a receiver for specific assets of the close corporation in accordance with Section 11.403 ; (4) the appointment of a receiver to rehabilitate the close corporation in accordance with Section 11.404 ; (5) subject to Section 21.757 , the liquidation of the assets and business and involuntary termination of the close corporation and appointment of a receiver to effect the liquidation in accordance with Section 11.405 ; and (6) the termination of close corporation status. (c) The court may not order termination of close corporation status under Subsection (b)(6) unless the court determines that: (1) any other remedy in law or equity, including appointment of a provisional director, custodian, or other type of receiver, is inadequate; and (2) the size, the nature of the business, or the number of shareholders of the close corporation, or their relationship to one another or other similar factors, make it wholly impractical to continue close corporation status. Acts 2003, 78th Leg., ch. 182, Sec. 1, eff. Jan. 1, 2006.