17-7213.   Appointment of provisional director for closecorporation, when; qualifications, rights and powers of provisionaldirector.(a) Notwithstanding any contrary provision of the articles ofincorporation or the bylaws or agreement of the stockholders, thedistrict court may appoint a provisional director for a closecorporation, if the directors are so divided respecting the managementof the corporation's business and affairs that the votes required foraction by the board of directors cannot be obtained, with theconsequence that the business and affairs of the corporation can nolonger be conducted to the advantage of the stockholders generally.

      (b)   An application for relief under this section must be filed (1)by at least one-half (1/2) of the number of directors then in office,(2) by the holders of at least one-third (1/3) of all stock thenentitled to elect directors, or, (3) if there be more than one class ofstock then entitled to elect one or more directors, by the holders oftwo-thirds (2/3) of the stock of any such class; but the articles ofincorporation of a close corporation may provide that a lesserproportion of the directors or of the stockholders or of a class ofstockholders may apply for relief under this section.

      (c)   A provisional director shall be an impartial person who isneither a stockholder nor a creditor of the corporation or of anysubsidiary or affiliate of the corporation, and whose furtherqualifications, if any, may be determined by the district court. Aprovisional director is not a receiver of the corporation and does nothave the title and powers of a custodian or receiver appointed underK.S.A. 17-6516 or 17-6901. A provisionaldirector shall have all the rights and powers of a duly elected directorof the corporation, including the right to notice of and to vote atmeetings of directors, until such time as he shall be removed by orderof the court, or by the holders of a majority of all shares thenentitled to vote to elect directors, or by the holders of two-thirds(2/3) of the shares of that class of voting shares which filed theapplication for appointment of a provisional director. His compensationshall be determined by agreement between him and the corporation,subject to approval of the court, which may fix his compensation in theabsence of agreement or in the event of disagreement between theprovisional director and the corporation.

      (d)   Even though the requirements of subsection (b) of this section,relating to the number of directors or stockholders who may petition forappointment of a provisional director are not satisfied, the districtcourt, nevertheless, may appoint a provisional director if permitted bysubsection (b) of K.S.A. 17-7212.

      History:   L. 1972, ch. 52, § 137; July 1.