Section 10-2A-309

Appointment of custodian for close corporation.

(a) The circuit court of the county in which the corporation has its registered office or any court in such place having jurisdiction, upon application of any shareholder, may appoint one or more persons to be custodians, and, if the corporation is insolvent, to be receivers, of any close corporation when:

(1) Pursuant to Section 10-2A-308 the business and affairs of the corporation are managed by the shareholders and they are so divided that the business of the corporation is suffering or is threatened with irreparable injury and any remedy with respect to such deadlock provided in the articles of incorporation or bylaws or in any written agreement of the shareholders has failed; or

(2) The petitioning shareholder has the right to the dissolution of the corporation under a provision of the articles of incorporation permitted by Section 10-2A-312.

(b) In lieu of appointing a custodian for a close corporation under this section the court may appoint a provisional director, whose powers and status shall be as provided in Section 10-2A-310 if the court determines that it would be in the best interest of the corporation. Such appointment shall not preclude any subsequent order of the court appointing a custodian for such corporation.

(c) A custodian appointed under this section shall have all the powers of a receiver appointed under Section 10-2A-196, but the authority of the custodian is to continue the business of the corporation and not to liquidate its affairs and distribute its assets, except when the court shall otherwise order.

(Acts 1980, No. 80-633, p. 1094, §170.)