CHAPTER 16 - Wyoming Business Corporation Act - Sale of Assets

Wyoming Business Corporation Act

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ARTICLE 12 - SALE OF ASSETS

17-16-1201. Disposition of assets not requiring shareholder approval

(a) No approval of the shareholders of a corporation is required unless the articles of incorporation otherwise provide:

(i) To sell, lease, exchange, or otherwise dispose of any or all of the corporation's assets in the usual and regular course of business;

(ii) To mortgage, pledge, dedicate to the repayment of indebtedness, whether with or without recourse, or otherwise encumber any or all of the corporation's assets whether or not in the usual and regular course of business; or

(iii) To transfer any or all of the corporation's assets to one (1) or more corporations or other entities all of the shares or interests of which are owned by the corporation; or

(iv) To distribute assets pro rata to the holders of one (1) or more classes or series of the corporation's shares.

(b) Repealed by Laws 2009, Ch. 115, 3.

17-16-1202. Shareholder approval of certain dispositions

(a) A sale, lease, exchange, or other disposition of assets, other than a disposition described in W.S. 17-16-1201, requires approval of the corporation's shareholders if the disposition would leave the corporation without a significant continuing business activity. If a significant business activity of the corporation prior to any such disposition of assets was the active or passive holding, maintenance or management of investments, then such holding, maintenance or management of investments shall be considered a significant continuing business activity. If a corporation retains a business activity that represented at least twenty-five percent (25%) of total assets at the end of the most recently completed fiscal year, and twenty-five percent (25%) of either income from continuing operations before taxes or revenues from continuing operations for that fiscal year, in each case of the corporation and its subsidiaries on a consolidated basis, the corporation will conclusively be deemed to have retained a significant continuing business activity.

(b) A disposition that requires approval of the shareholders under subsection (a) of this section shall be initiated by a resolution by the board of directors authorizing the disposition. After adoption of such a resolution, the board of directors shall submit the proposed disposition to the shareholders for their approval. The board of directors shall also transmit to the shareholders a recommendation that the shareholders approve the proposed disposition, unless the board of directors makes a determination that because of conflicts of interest or other special circumstances it should not make such a recommendation, in which case the board of directors shall transmit to the shareholders the basis for that determination.

(c) The board of directors may condition its submission of a disposition to the shareholders under subsection (b) of this section on any basis.

(d) If a disposition is required to be approved by the shareholders under subsection (a) of this section and if the approval is to be given at a meeting, the corporation shall notify each shareholder, whether or not entitled to vote, of the meeting of shareholders at which the disposition is to be submitted for approval. The notice shall state that the purpose, or one (1) of the purposes, of the meeting is to consider the disposition and shall contain a description of the disposition, including the terms and conditions thereof and the consideration to be received by the corporation.

(e) Unless the articles of incorporation or the board of directors, acting pursuant to subsection (c) of this section, require a greater vote or a greater number of votes to be present, the approval of a disposition by the shareholders shall require the approval of the shareholders at a meeting at which a quorum exists.

(f) After a disposition has been approved by the shareholders under subsection (b) of this section and at any time before the disposition has been consummated, it may be abandoned by the corporation without action by the shareholders, subject to any contractual rights of other parties to the disposition.

(g) A disposition of assets in the course of dissolution under article 14 is not governed by this section.

(h) For purposes of this section, the ownership interests of a parent corporation in its subsidiaries, whether owned directly by the parent corporation or indirectly through other subsidiaries shall be valued at the net asset values of such subsidiaries, without application of any discount to the valuation of such ownership interests because of a lack of marketability or otherwise.

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