§ 909 — Sale, lease, exchange or other disposition of assets

§ 909. Sale, lease, exchange or other disposition of assets.\n (a) A sale, lease, exchange or other disposition of all or\nsubstantially all the assets of a corporation, if not made in the usual\nor regular course of the business actually conducted by such\ncorporation, shall be authorized only in accordance with the following\nprocedure:\n (1) The board shall authorize the proposed sale, lease, exchange or\nother disposition and direct its submission to a vote of shareholders.\n (2) Notice of meeting shall be given to each shareholder of record,\nwhether or not entitled to vote.\n (3) The shareholders shall approve such sale, lease, exchange or other\ndisposition and may fix, or may authorize the board to fix, any of the\nterms and conditions thereof and the consideration to be received by the\ncorporation therefor, which may consist in whole or in part of cash or\nother property, real or personal, including shares, bonds or other\nsecurities of any other domestic or foreign corporation or corporations,\nby vote at a meeting of shareholders of (A) for corporations in\nexistence on the effective date of this clause the certificate of\nincorporation of which expressly provides such or corporations\nincorporated after the effective date of this clause, a majority of the\nvotes of all outstanding shares entitled to vote thereon or (B) for\nother corporations in existence on the effective date of this clause,\ntwo-thirds of the votes of all outstanding shares entitled to vote\nthereon.\n (b) A recital in a deed, lease or other instrument of conveyance\nexecuted by a corporation to the effect that the property described\ntherein does not constitute all or substantially all of the assets of\nthe corporation, or that the disposition of the property affected by\nsaid instrument was made in the usual or regular course of business of\nthe corporation, or that the shareholders have duly authorized such\ndisposition, shall be presumptive evidence of the fact so recited.\n (c) An action to set aside a deed, lease or other instrument of\nconveyance executed by a corporation affecting real property or real and\npersonal property may not be maintained for failure to comply with the\nrequirements of paragraph (a) unless the action is commenced and a\nnotice of pendency of action is filed within one year after such\nconveyance, lease or other instrumment is recorded or within six months\nafter this subdivision takes effect, whichever date occurs later.\n (d) Whenever a transaction of the character described in paragraph (a)\ninvolves a sale, lease, exchange or other disposition of all or\nsubstantially all the assets of the corporation, including its name, to\na new corporation formed under the same name as the existing\ncorporation, upon the expiration of thirty days from the filing of the\ncertificate of incorporation of the new corporation, with the consent of\nthe state tax commission attached, the existing corporation shall be\nautomatically dissolved, unless, before the end of such thirty-day\nperiod, such corporation has changed its name. The adjustment and\nwinding up of the affairs of such dissolved corporation shall proceed in\naccordance with the provisions of article 10 (Non-judicial dissolution).\n (e) The certificate of incorporation of a corporation formed under the\nauthority of paragraph (d) shall set forth the name of the existing\ncorporation, the date when its certificate of incorporation was filed by\nthe department of state, and that the shareholders of such corporation\nhave authorized the sale, lease, exchange or other disposition of all or\nsubstantially all the assets of such corporation, including its name, to\nthe new corporation to be formed under the same name as the existing\ncorporation.\n (f) Notwithstanding shareholder approval, the board may abandon the\nproposed sale, lease, exchange or other disposition without further\naction by the shareholders, subject to the rights, if any, of third\nparties under any contract relating thereto.\n