TEXAS BUSINESS ORGANIZATIONS CODE

TITLE 3. LIMITED LIABILITY COMPANIES

CHAPTER 101. LIMITED LIABILITY COMPANIES

SUBCHAPTER F. MANAGEMENT

Sec. 101.251. MEMBERSHIP.
The governing authority of a limited liability company consists of:
(1) the managers of the company, if the company’s certificate of formation states that the company will have one or more managers; or
(2) the members of the company, if the company’s certificate of formation states that the company will not have managers.

Sec. 101.252. MANAGEMENT BY GOVERNING AUTHORITY.
The governing authority of a limited liability company shall manage the business and affairs of the company as provided by:
(1) the company agreement; and
(2) this title and the provisions of Title 1 applicable to a limited liability company to the extent that the company agreement does not provide for the management of the company.

Sec. 101.253. DESIGNATION OF COMMITTEES; DELEGATION OF AUTHORITY.
(a) The governing authority of a limited liability company by resolution may designate:
(1) one or more committees of the governing authority consisting of one or more governing persons of the company; and
(2) subject to any limitation imposed by the governing authority, a governing person to serve as an alternate member of a committee designated under Subdivision (1) at a committee meeting from which a member of the committee is absent or disqualified.
(b) A committee of the governing authority of a limited liability company may exercise the authority of the governing authority as provided by the resolution designating the committee.
(c) The designation of a committee under this section does not relieve the governing authority of any responsibility imposed by law.

Sec. 101.254. DESIGNATION OF AGENTS; BINDING ACTS.
(a) Except as provided by this title and Title 1, each governing person of a limited liability company and each officer or agent of a limited liability company vested with actual or apparent authority by the governing authority of the company is an agent of the company for purposes of carrying out the company’s business.
(b) An act committed by an agent of a limited liability company described by Subsection (a) for the purpose of apparently carrying out the ordinary course of business of the company, including the execution of an instrument, document, mortgage, or conveyance in the name of the company, binds the company unless:
(1) the agent does not have actual authority to act for the company; and
(2) the person with whom the agent is dealing has knowledge of the agent’s lack of actual authority.
(c) An act committed by an agent of a limited liability company described by Subsection (a) that is not apparently for carrying out the ordinary course of business of the company binds the company only if the act is authorized in accordance with this title.

Sec. 101.255. CONTRACTS OR TRANSACTIONS INVOLVING INTERESTED GOVERNING PERSONS OR OFFICERS.
(a) This section applies only to a contract or transaction between a limited liability company and:
(1) one or more of the company’s governing persons or officers; or
(2) an entity or other organization in which one or more of the company’s governing persons or officers:
(A) is a managerial official; or
(B) has a financial interest.
(b) An otherwise valid contract or transaction is valid notwithstanding that a governing person or officer of the company is present at or participates in the meeting of the governing authority, or of a committee of the governing person’s authority, that authorizes the contract or transaction or votes to authorize the contract or transaction, if:
(1) the material facts as to the relationship or interest and as to the contract or transaction are disclosed to or known by:
(A) the company’s governing authority or a committee of the governing authority and the governing authority or committee in good faith authorizes the contract or transaction by the affirmative vote of the majority of the disinterested governing persons or committee members, regardless of whether the disinterested governing persons or committee members constitute a quorum; or
(B) the members of the company, and the members in good faith approve the contract or transaction by vote of the members; or
(2) the contract or transaction is fair to the company when the contract or transaction is authorized, approved, or ratified by the governing authority, a committee of the governing authority, or the members of the company.
(c) Common or interested governing persons of a limited liability company may be included in determining the presence of a quorum at a meeting of the company’s governing authority or of a committee of the governing authority that authorizes the contract or transaction.