§414-332  Sale of assets other than inregular course of business.  (a)  A corporation may sell, lease, exchange,or otherwise dispose of all, or substantially all, of its property (with orwithout the goodwill), otherwise than in the usual and regular course ofbusiness, on the terms and conditions and for the consideration determined bythe corporation's board of directors, if the board of directors proposes andits shareholders approve the proposed transaction.

(b)  For a transaction to be authorized:

(1)  The board of directors must recommend theproposed transaction to the shareholders unless the board of directorsdetermines that because of conflict of interest or other special circumstancesit should make no recommendation and communicates the basis for itsdetermination to the shareholders with the submission of the proposedtransaction; and

(2)  The shareholders entitled to vote must approvethe transaction.

(c)  The board of directors may condition itssubmission of the proposed transaction on any basis.

(d)  The corporation shall notify eachshareholder, whether or not entitled to vote, of the proposed shareholders'meeting in accordance with section 414-125.  The notice must also state thatthe purpose, or one of the purposes, of the meeting is to consider the sale,lease, exchange, or other disposition of all, or substantially all, theproperty of the corporation and contain or be accompanied by a description ofthe transaction.

(e)  With respect to corporations incorporatedon or after July 1, 1987, at the meeting the shareholders may authorizethe sale, lease, exchange, or other disposition and may fix, or may authorizethe board of directors to fix, any or all of the terms and conditions thereofand the consideration to be received by the corporation therefor.  Theauthorization shall require the affirmative vote of the holders of a majorityof the shares of the corporation entitled to vote thereon, unless any class ofshares is entitled to vote thereon as a class, in which event the authorizationshall require the affirmative vote of the holders of a majority of the sharesof each class of shares entitled to vote as a class thereon and of the totalshares entitled to vote thereon.

(f)  With respect to corporations incorporatedbefore July 1, 1987, at the meeting the shareholders may authorize thesale, lease, exchange, or other disposition and may fix, or may authorize theboard of directors to fix, any or all of the terms and conditions therefor. The authorization shall require the affirmative vote of the holders ofthree-fourths of the shares of the corporation entitled to vote as a classthereon and of the total shares entitled to vote thereon.  The articles ofincorporation may be amended by the vote set forth in the preceding sentence toprovide 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 ofincorporation shall control; provided that the lesser proportion shall not beless than the proportion set forth in subsection (e).

(g)  After a sale, lease, exchange, or otherdisposition of property is authorized, the transaction may be abandoned(subject to any contractual rights) without further shareholder action.

(h)  A transaction that constitutes adistribution is governed by section 414-111 and not by this section.

(i)  A sale, lease, exchange, or otherdisposition of the property of a corporation shall not be deemed to be thesale, lease, exchange, or other disposition of all or substantially all theproperty of the corporation if the corporation is retaining sufficient propertyto continue one or more significant business segments or lines of thecorporation after the sale, lease, exchange, or other disposition. Furthermore, the business segments or lines retained must not be only temporaryoperations or merely a pretext to avoid shareholders' rights which mightotherwise arise under this chapter. [L 2000, c 244, pt of §1; am L 2001, c 129,§37]