17-7202.   Close corporation defined; contents ofarticles of incorporation; effect of joint held stock.(a) A close corporation is a corporation organized under this act whosearticles of incorporation contain the provisions required by K.S.A. 17-6002,and amendments thereto, and, in addition, provide that:

      (1)   All of the corporation's issued stock of all classes, exclusiveof treasury shares, shall be held of record by not more than a specifiednumber of persons, not exceeding 35; and

      (2)   All of the issued stock of all classes shall be subject to one or more ofthe restrictions on transfer permitted by K.S.A. 17-6426, and amendmentsthereto; and

      (3)   The corporation shall make no offering of any of its stock ofany class which would constitute a "public offering" within the meaningof the United States securities act of 1933, as it may be amended fromtime to time.

      (b)   The articles of incorporation of a close corporation may setforth the qualifications of stockholders, either by specifying classesof persons who shall be entitled to be holders of record of stock of anyclass, or by specifying classes of persons who shall not be entitled tobe holders of stock of any class, or both.

      (c)   For purposes of determining the number of holders of record ofthe stock of a close corporation, stock which is held in joint or commontenancy or by the entireties shall be treated as held by one stockholder.

      History:   L. 1972, ch. 52, § 126;L. 2004, ch. 143, § 77; Jan. 1, 2005.