Georgia § 14-2-1202 - Sale of assets requiring shareholder approval.

§ 14-2-1202. Sale of assets requiring shareholder approval.

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 pursuant to Code Section 14-2-1201, on the terms and conditions and for the consideration determined by the corporation's board of directors, if the board of directors proposes and its shareholders approve the proposed transaction. For a transaction to be authorized: 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 either refrain from making such a recommendation or recommend that the shareholders reject or vote against the plan, in which case the board of directors shall transmit to the shareholders the basis for such determination; and The shareholders entitled to vote must approve the transaction. The board of directors may condition its submission of the proposed transaction, the effectiveness of the proposed transaction, or both on any basis. The corporation shall notify each shareholder entitled to vote of the proposed shareholders' meeting in accordance with Code Section 14-2-705. The notice must 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 of the property of the corporation and contain or be accompanied by a description of the transaction. Unless the articles of incorporation, the bylaws, or the board of directors (acting pursuant to subsection (c) of this Code section) require a greater vote or a vote by voting groups, the transaction to be authorized must be approved by a majority of all the votes entitled to be cast on the transaction. After a sale, lease, exchange, or other disposition of property is authorized, the transaction may be abandoned (subject to any contractual rights) without further shareholder action. A transaction that constitutes a distribution is governed by Code Section 14-2-640 and not by this Code section. (Code 1981, § 14-2-1202 , enacted by Ga. L. 1988, p. 1070, § 1; Ga. L. 1997, p. 1165, § 11; Ga. L. 2004, p. 508, § 19; Ga. L. 2006, p. 825, § 15/SB 469.) Law reviews. - For article on the definition of a security in light of the 1973 Georgia Securities Act and the need for maximizing investor protection, see 30 Emory L.J. 73 (1981). For article, "Some Distinctive Features of the Georgia Business Corporation Code," 28 Ga. St. B. J. 101 (1991).