Iowa Code 504.1201 – Sale of assets in regular course of activities and mortgage of assets
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1. A corporation may, on the terms and conditions and for the consideration determined by the board of directors, do either of the following:
a. Sell, lease, exchange, or otherwise dispose of all, or substantially all, of its property in the usual and regular course of its activities.
b. Mortgage, pledge, dedicate to the repayment of indebtedness, whether with or without recourse, or otherwise encumber any or all of its property, whether or not in the usual and regular course of its activities.
Terms Used In Iowa Code 504.1201
- articles: includes amended and restated articles of incorporation and articles of merger. See Iowa Code 504.141
- board of directors: means the board of directors of a corporation except that no person or group of persons are the board of directors because of powers delegated to that person or group pursuant to section 504. See Iowa Code 504.141
- following: when used by way of reference to a chapter or other part of a statute mean the next preceding or next following chapter or other part. See Iowa Code 4.1
- Lease: A contract transferring the use of property or occupancy of land, space, structures, or equipment in consideration of a payment (e.g., rent). Source: OCC
- property: includes personal and real property. See Iowa Code 4.1
- Recourse: An arrangement in which a bank retains, in form or in substance, any credit risk directly or indirectly associated with an asset it has sold (in accordance with generally accepted accounting principles) that exceeds a pro rata share of the bank's claim on the asset. If a bank has no claim on an asset it has sold, then the retention of any credit risk is recourse. Source: FDIC
2. Unless the articles require it, approval of the members or any other persons of a transaction described in subsection 1 is not required.