§ 511 — Petition for court approval

New York § 511

• Jurisdiction: New York
• Law NPC: Not-for-Profit Corporation
• Art. 5: Corporate Finance

Text

§ 511. Petition for court approval.\n (a) To obtain court approval to sell, lease, exchange or otherwise\ndispose of all or substantially all its assets, a corporation shall\npresent a verified petition to the supreme court of the judicial\ndistrict, or the county court of the county, wherein the corporation has\nits office or principal place of carrying out the purposes for which it\nwas formed. The petition shall set forth:\n 1. The name of the corporation, the law under or by which it was\nincorporated.\n 2. The names of its directors and principal officers, and their places\nof residence.\n 3. The activities of the corporation.\n 4. A description, with reasonable certainty, of the assets to be sold,\nleased, exchanged, or otherwise disposed of, or a statement that it is\nproposed to sell, lease, exchange or otherwise dispose of all or\nsubstantially all the corporate assets more fully described in a\nschedule attached to the petition; and a statement of the fair value of\nsuch assets, and the amount of the corporation's debts and liabilities\nand how secured.\n 5. The consideration to be received by the corporation and the\ndisposition proposed to be made thereof, together with a statement that\nthe dissolution of the corporation is or is not contemplated thereafter.\n 6. That the consideration and the terms of the sale, lease, exchange\nor other disposition of the assets of the corporation are fair and\nreasonable to the corporation, and that the purposes of the corporation,\nor the interests of its members will be promoted thereby, and a concise\nstatement of the reasons therefor.\n 7. That such sale, lease, exchange or disposition of corporate assets,\nhas been recommended or authorized by vote of the directors in\naccordance with law, at a meeting duly called and held, as shown in a\nschedule annexed to the petition setting forth a copy of the resolution\ngranting such authority with a statement of the vote thereon.\n 8. Where the consent of members of the corporation is required by law,\nthat such consent has been given, as shown in a schedule annexed to the\npetition setting forth a copy of such consent, if in writing, or of a\nresolution giving such consent, adopted at a meeting of members duly\ncalled and held, with a statement of the vote thereon.\n 9. A request for court approval to sell, lease, exchange or otherwise\ndispose of all or substantially all the assets of the corporation as set\nforth in the petition.\n (b) Upon presentation of the petition, the court shall direct that a\nminimum of fifteen days notice be given by mail or in person to the\nattorney general, and in its discretion may direct that notice of the\napplication be given, personally or by mail, to any person interested\ntherein, as member, officer or creditor of the corporation. The court\nshall have authority to shorten the time for service on the attorney\ngeneral upon a showing of good cause. The notice shall specify the time\nand place, fixed by the court, for a hearing upon the application. Any\nperson interested, whether or not formally notified, may appear at the\nhearing and show cause why the application should not be granted.\n (c) If the corporation be insolvent, or if its assets be insufficient\nto liquidate its debts and liabilities in full, the application shall\nnot be granted unless all the creditors of the corporation shall have\nbeen served, personally or by mail, with a notice of the time and place\nof the hearing.\n (d) If it shall appear, to the satisfaction of the court, that the\nconsideration and the terms of the transaction are fair and reasonable\nto the corporation and that the purposes of the corporation or the\ninterests of the members will be promoted, it may authorize the sale,\nlease, exchange or other disposition of all or substantially all the\nassets of the corporation, as described in the petition, for such\nconsideration and upon such terms as the court may prescribe. The order\nof the court shall direct the disposition of the consideration to be\nreceived thereunder by the corporation.\n