Montana Code 35-2-617. Sale of assets other than in regular course of activities
35-2-617. Sale of assets other than in regular course of activities. (1) A corporation may sell, lease, exchange, or otherwise dispose of all or substantially all of its property, which may include the good will, other than in the usual and regular course of its activities on the terms and conditions and for the consideration determined by the corporation‘s board if the proposed transaction is approved as required by subsection (2).
Terms Used In Montana Code 35-2-617
- Amendment: A proposal to alter the text of a pending bill or other measure by striking out some of it, by inserting new language, or both. Before an amendment becomes part of the measure, thelegislature must agree to it.
- Approved by the members: means approved and ratified by the affirmative vote:
(a)of a majority of the votes represented and voting:
(i)at a meeting at which a quorum is present and the affirmative votes constitute a majority of the required quorum;
(ii)by a written ballot or written consent in conformity with this chapter; or
(iii)by the affirmative vote, written ballot, or written consent of the majority; and
(b)that includes the votes of all the members of any class, unit, or grouping that may be required by the articles, bylaws, or this chapter for any specified member action. See Montana Code 35-2-114
- articles: include amended and restated articles of incorporation and articles of merger. See Montana Code 35-2-114
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- board of directors: means the board of directors except that a person or group of persons is not the board of directors because of powers delegated to that person or group pursuant to 35-2-414. See Montana Code 35-2-114
- Bylaws: means the code, codes, or rules, other than the articles, adopted pursuant to this chapter for the regulation or management of the affairs of the corporation, regardless of the name or names by which the code, codes, or rules are designated. See Montana Code 35-2-114
- Class: refers to a group of memberships that have the same rights with respect to voting, dissolution, redemption, and transfer. See Montana Code 35-2-114
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Corporation: means a public benefit corporation, mutual benefit corporation, or religious corporation. See Montana Code 35-2-114
- Directors: means individuals:
(a)designated in the articles or bylaws or elected by the incorporators and their successors; and
(b)elected or appointed by any other name or title to act as members of the board. See Montana Code 35-2-114
- Entity: includes :
(a)a corporation and foreign corporation;
(b)a business corporation and foreign business corporation;
(c)a profit and nonprofit unincorporated association;
(d)a corporation sole;
(e)a business trust, an estate, a partnership, a trust, and two or more persons having a joint or common economic interest; and
(f)a state, the United States, and a foreign government. See Montana Code 35-2-114
- 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
- Membership: refers to the rights and obligations a member or members have pursuant to a corporation's articles, bylaws, and this chapter. See Montana Code 35-2-114
- Notice: means that term as described in 35-2-115. See Montana Code 35-2-114
- Person: includes any individual or entity. See Montana Code 35-2-114
- Property: means real and personal property. See Montana Code 1-1-205
- Public benefit corporation: means a domestic corporation designated as a public benefit corporation. See Montana Code 35-2-114
- Religious corporation: means a domestic corporation designated as a religious corporation. See Montana Code 35-2-114
- State: when applied to the different parts of the United States, includes the District of Columbia and the territories. See Montana Code 1-1-201
- Usual: means according to usage. See Montana Code 1-1-206
- voting: includes but is not limited to the giving of consent in the form of a record provided electronically or by written ballot and written consent. See Montana Code 35-2-114
- Voting power: means the total number of votes entitled to be cast for the election of directors at the time the determination of voting power is made. See Montana Code 35-2-114
- Writing: includes printing. See Montana Code 1-1-203
(2)Unless this chapter, the articles, the bylaws, or the board of directors or members, acting pursuant to subsection (4), require a greater vote or voting by class, the proposed transaction to be authorized must be approved:
(a)by the board;
(b)by the members by two-thirds of the votes cast or a majority of the voting power, whichever is less; and
(c)in writing by any person or persons whose approval is required by a provision of the articles, as authorized by 35-2-232, for an amendment to the articles or bylaws.
(3)If the corporation does not have members, the transaction must be approved by a vote of a majority of the directors in office at the time the transaction is approved. In addition, the corporation shall provide notice, in accordance with 35-2-429(3), of any directors’ meeting at which approval is to be obtained. 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 or assets of the corporation and must contain or be accompanied by a copy or summary of a description of the transaction.
(4)The board may condition its submission of the proposed transaction and the members may condition their approval of the transaction on receipt of a higher percentage of affirmative votes or on any other basis.
(5)If the corporation seeks to have the transaction approved by the members at a membership meeting, the corporation shall give notice to its members of the proposed membership meeting in accordance with 35-2-530. The notice must 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 or assets of the corporation and must contain or be accompanied by a copy or summary of a description of the transaction.
(6)If the board needs to have the transaction approved by the members by written consent or written ballot, the material soliciting the approval must contain or be accompanied by a copy or summary of a description of the transaction.
(7)(a) Except as provided in subsection (7)(b), a public benefit corporation or religious corporation shall give written notice to the attorney general 20 days before it sells, leases, exchanges, or otherwise disposes of all or substantially all of its property if the transaction is not in the usual and regular course of its activities unless the attorney general has given the corporation a written waiver of this subsection.
(b)A public benefit corporation or religious corporation that is considered a nonprofit health entity, as defined in 50-4-701, is subject to the provisions of Title 50, chapter 4, part 7.
(8)After a sale, lease, exchange, or other disposition of property is authorized, the transaction may be abandoned, subject to any contractual rights, without further action by the members or any other person who approved the transaction in accordance with the procedure set forth in the resolution proposing the transaction or, if no procedure is set forth, in the manner determined by the board of directors.