(a) An association may not issue preferred stock before the preferred stock is fully paid for in cash.
(b) An association may not make a loan against the shares of its outstanding preferred stock.
(c) An association may retire or redeem preferred stock in the manner provided by:
(1) the articles of incorporation; or
(2) a resolution of the board establishing the rights and preferences relating to the stock.
Official text of the Texas Finance Code as published by the Texas Legislative Council.