Texas § BO.21.761 - APPOINTMENT OF CUSTODIAN

§ BO.21.761. APPOINTMENT OF CUSTODIAN

APPOINTMENT OF CUSTODIAN. (a) In a judicial proceeding under this section, a court shall appoint a custodian for a close corporation on presentation of proof that: (1) at a meeting held for the election of directors, the shareholders are so divided that the shareholders have failed to elect successors to directors whose terms have expired or would have expired on qualification of a successor; (2) the business of the close corporation is suffering or is threatened with irreparable injury because the directors, or the shareholders or the persons empowered to manage the business and affairs of the close corporation under a shareholders' agreement, are so divided with respect to the management of the business and affairs of the close corporation that the required vote or consent to take action on behalf of the close corporation cannot be obtained and a remedy with respect to the deadlock in a close corporation provision has failed; or (3) the plaintiff or intervenor has the right to wind up and terminate the close corporation under a shareholders' agreement as provided by Section 21.714 . (b) To be eligible to serve as a custodian, a person must comply with all the qualifications required to serve as a receiver under Section 11.406 . Acts 2003, 78th Leg., ch. 182, Sec. 1, eff. Jan. 1, 2006.