Consuming Assets Corporation Law and Legal Definition

Texas Business Organizations Code defines a Consuming Assets Corporation. Tex. Business Organizations Code § 21.002 reads in relevant part:

"Consuming assets corporation" means a corporation that:

1.is engaged in the business of exploiting assets subject to depletion or amortization;

2.states in its certificate of formation that it is a consuming assets corporation;

3. includes the phrase "a consuming assets corporation" as part of its official corporate name and gives the phrase equal prominence with the rest of the corporate name on the financial statements and certificates of ownership of the corporation; and

4. includes in each of the certificates of ownership of the corporation the sentence, "This corporation is permitted by law to pay dividends out of reserves that may impair its stated capital."