§414-332 Sale of assets other than in
regular course of business. (a) A corporation may sell, lease, exchange,
or otherwise dispose of all, or substantially all, of its property (with or
without the goodwill), otherwise than in the usual and regular course of
business, on the terms and conditions and for the consideration determined by
the corporation's board of directors, if the board of directors proposes and
its shareholders approve the proposed transaction.
(b) For a transaction to be authorized:
(1) The board of directors must recommend the
proposed transaction to the shareholders unless the board of directors
determines that because of conflict of interest or other special circumstances
it should make no recommendation and communicates the basis for its
determination to the shareholders with the submission of the proposed
transaction; and
(2) The shareholders entitled to vote must approve
the transaction.
(c) The board of directors may condition its
submission of the proposed transaction on any basis.
(d) The corporation shall notify each
shareholder, whether or not entitled to vote, of the proposed shareholders'
meeting in accordance with section 414-125. The notice must also state that
the purpose, or one of the purposes, of the meeting is to consider the sale,
lease, exchange, or other disposition of all, or substantially all, the
property of the corporation and contain or be accompanied by a description of
the transaction.
(e) With respect to corporations incorporated
on or after July 1, 1987, at the meeting the shareholders may authorize
the sale, lease, exchange, or other disposition and may fix, or may authorize
the board of directors to fix, any or all of the terms and conditions thereof
and the consideration to be received by the corporation therefor. The
authorization shall require the affirmative vote of the holders of a majority
of the shares of the corporation entitled to vote thereon, unless any class of
shares is entitled to vote thereon as a class, in which event the authorization
shall require the affirmative vote of the holders of a majority of the shares
of each class of shares entitled to vote as a class thereon and of the total
shares entitled to vote thereon.
(f) With respect to corporations incorporated
before July 1, 1987, at the meeting the shareholders may authorize the
sale, lease, exchange, or other disposition and may fix, or may authorize the
board of directors to fix, any or all of the terms and conditions therefor.
The authorization shall require the affirmative vote of the holders of
three-fourths of the shares of the corporation entitled to vote as a class
thereon and of the total shares entitled to vote thereon. The articles of
incorporation may be amended by the vote set forth in the preceding sentence to
provide for a lesser proportion of shares, or of any class or series thereof,
than is provided in the preceding sentence, in which case the articles of
incorporation shall control; provided that the lesser proportion shall not be
less than the proportion set forth in subsection (e).
(g) After a sale, lease, exchange, or other
disposition of property is authorized, the transaction may be abandoned
(subject to any contractual rights) without further shareholder action.
(h) A transaction that constitutes a
distribution is governed by section 414-111 and not by this section.
(i) A sale, lease, exchange, or other
disposition of the property of a corporation shall not be deemed to be the
sale, lease, exchange, or other disposition of all or substantially all the
property of the corporation if the corporation is retaining sufficient property
to continue one or more significant business segments or lines of the
corporation after the sale, lease, exchange, or other disposition.
Furthermore, the business segments or lines retained must not be only temporary
operations or merely a pretext to avoid shareholders' rights which might
otherwise arise under this chapter. [L 2000, c 244, pt of §1; am L 2001, c 129,
§37]