17-6410. Powers of corporation respecting its own stock; limitations.
17-6410
17-6410. Powers of corporation respecting its own
stock; limitations.
(a) Every corporation may purchase, redeem, receive, take or otherwise acquire,
own and hold, sell, lend, exchange, transfer or otherwise dispose of, pledge,
use and otherwise deal in and with its own shares; provided, however, that no
corporation shall:
(1) Purchase or redeem its own shares of capital stock for cash or other
property when the capital of the corporation is impaired or when such purchase
or redemption would cause any impairment of the capital of the corporation,
except that a corporation may purchase or redeem out of capital any of its own
shares which are entitled upon any distribution of its assets, whether by
dividend or in liquidation, to a preference over another class or series of its
stock, or, if no shares entitled to such a preference are outstanding, any of
its own shares, if such shares will be retired upon their acquisition and the
capital of the corporation reduced in accordance with K.S.A. 17-6603 and
17-6604, and amendments thereto. Nothing in this subsection shall invalidate or
otherwise affect a note, debenture or other obligation of a corporation given
by it as consideration for its acquisition by purchase, redemption or exchange
of its shares of stock if at the time such note, debenture or obligation was
delivered by the corporation its capital was not then impaired or did not
thereby become impaired;
(2) purchase, for more than the price at which they may then be redeemed, any
of its shares which are redeemable at the option of the
corporation; or
(3) redeem any of its shares unless their redemption is authorized by
subsection (b) of K.S.A. 17-6401, and amendments thereto, and then only in
accordance with such section and the articles of incorporation.
(b) Nothing in this section limits or affects a corporation's right to resell
any of its shares theretofore purchased or redeemed out of surplus and which
have not been retired, for such consideration as shall be fixed by the
board of directors.
(c) Shares of its own capital stock belonging to the corporation or to
another corporation, if a majority of the shares entitled to vote in the
election of directors of such other corporation is held, directly or
indirectly, by the corporation, shall neither be entitled to vote nor be
counted for quorum purposes. Nothing in this section shall be construed as
limiting the right of any corporation to vote stock, including but not limited
to its own stock, held by it in a fiduciary capacity.
(d) Shares which have been called for redemption shall not be deemed to be
outstanding shares for the purpose of voting or determining the total number of
shares entitled to vote on any matter on and after the date on which written
notice of redemption has been sent to holders thereof and a sum sufficient to
redeem such shares has been irrevocably deposited or set aside to pay the
redemption price to the holders of the shares upon surrender of
certificates therefor.
History: L. 1972, ch. 52, § 37;
L. 1988, ch. 99, § 15;
Revived and amend., L. 1988, ch. 100, § 15;
L. 2004, ch. 143, § 16; Jan. 1, 2005.