US Laws, Codes, Statutes & Cases

§ 13.1-900. 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 good will, 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 adopts and its members approve the proposed transaction.

B. For a transaction to be authorized where there are members having voting rights:

1. The board of directors shall submit the proposed transaction to the members with its recommendation unless the board of directors determines that because of conflict of interests or other special circumstances it should make no recommendation and communicates the basis for its determination to the members with the submission of the proposed transaction.

2. The members entitled to vote shall approve the transaction as provided in subdivision 5 of this subsection.

3. The board of directors may condition its submission of the proposed transaction on any basis.

4. The corporation shall notify each member, whether or not entitled to vote, of the proposed members' meeting in accordance with § 13.1-842. The notice shall 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 copy of the agreement pursuant to which the transaction will be effected.

5. Unless the board of directors, acting pursuant to subdivision 3 of this subsection, requires a greater vote, the transaction to be authorized shall be approved by more than two-thirds of all the votes cast on the transaction at a meeting at which a quorum exists. The articles of incorporation may provide for a greater or lesser vote than that provided for in this subsection or a vote by separate voting groups so long as the vote provided for is not less than a majority of all the votes cast on the transaction by each voting group entitled to vote on the transaction at a meeting at which a quorum of the voting group exists.

6. Unless the parties to the transaction have agreed otherwise, after a sale, lease, exchange, or other disposition of property is authorized, the transaction may be abandoned, subject to any contractual rights, without further member action in accordance with the procedure set forth in the resolution proposing the transaction or, if none is set forth, in the manner determined by the board of directors.

C. For a transaction to be authorized where there are no members, or no members having voting rights, the proposed transaction shall be authorized upon receiving the vote of a majority of the directors in office.

(Code 1950, §§ 13-232, 13.1-246; 1956, c. 428; 1985, c. 522; 1991, c. 110.)