{"formats":[{"name":"JSON","format":"json","url":"\/downloads\/2025\/code-json\/13.1-724.json"},{"name":"Plain Text","format":"text","url":"\/downloads\/2025\/code-text\/13.1-724.txt"},{"name":"XML","format":"xml","url":"\/downloads\/2025\/code-xml\/13.1-724.xml"},{"name":"HTML","format":"html","url":"\/downloads\/2025\/code-html\/13.1-724.html"}],"law_id":78985,"edition_id":1,"section_id":78985,"structure_id":16780,"section_number":"13.1-724","catch_line":"Shareholder approval of certain dispositions","history":"Code 1950, \u00a7\u00a7 13-83, 13-84, 13.1-77; 1954, c. 499; 1956, c. 428; 1968, c. 109; 1971, Ex. Sess., c. 117; 1975, c. 500; 1985, c. 522; 1987, c. 181; 1996, c. 77; 2005, c. 765; 2019, c. 734.","full_text":"A\n\nA sale, lease, exchange or other disposition of the corporation’s assets, other than a disposition described in § 13.1-723, requires approval of the corporation’s shareholders if the disposition would leave the corporation without a significant continuing business activity. The corporation will conclusively be deemed to have retained a significant continuing business activity if it retains a business activity that represented, for the corporation and its subsidiaries on a consolidated basis, (i) at least 20 percent of total assets at the end of the most recently completed fiscal year, and (ii) at least 20 percent of either (a) income from continuing operations before taxes or (b) revenues from continuing operations, in each case for the most recently completed fiscal year.B\n\nA disposition that requires approval of the shareholders under subsection A shall be initiated by adoption of 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 submit 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 inform the shareholders of the basis for that determination.C\n\nThe board of directors may set conditions for the approval of a disposition by the shareholders or the effectiveness of the disposition.D\n\nIf a disposition is required to be approved by the shareholders and if the approval is to be sought at a shareholders’ meeting, the corporation shall notify each shareholder, whether or not entitled to vote, of the shareholders’ meeting at which the disposition is to be submitted for approval in accordance with § 13.1-658. The notice shall also state that the purpose, or one of the purposes, of the meeting is to consider the disposition and shall contain or be accompanied by a copy or summary of the agreement pursuant to which the disposition will be effected. If only a summary of the agreement is sent to shareholders, the corporation also shall send a copy of the agreement to any shareholder who requests it.E\n\nUnless the articles of incorporation or board of directors, acting pursuant to subsection C, requires a greater vote or a greater quorum, the approval of a disposition by the shareholders shall require at a meeting at which a quorum exists the approval of the holders of more than two-thirds of all the votes entitled to be cast on the disposition. The articles of incorporation may provide for a greater or lesser vote than that provided for in this subsection or a vote by separate voting groups so long as the vote provided for is not less than a majority of all the votes cast on the disposition by each voting group entitled to vote on the disposition at a meeting at which a quorum of the voting group exists.F\n\nUnless the parties to the disposition have agreed otherwise, after a disposition has been approved by the shareholders, and at any time before the disposition has been consummated, it may be abandoned without action by the shareholders, subject to any contractual rights of the parties to the disposition.G\n\nA disposition of assets in the course of dissolution under Article 16 (§ 13.1-742 et seq.) is not governed by this section.H\n\nThe assets of a direct or indirect consolidated subsidiary shall be deemed to be the assets of the parent corporation for the purposes of this section.I\n\nNotwithstanding any other provision of this section, no corporation organized to conduct the business of a railroad or other public service or a banking business, or a savings institution, an industrial loan association or a credit union may sell, lease or exchange its properties for the conduct of such business in the Commonwealth except to a corporation of the Commonwealth organized for the same purpose or in the case of a bank to a savings and loan association or a corporation of the United States, and in the case of a savings and loan association to a bank or a corporation of the United States.","order_by":null,"text":{"0":{"id":282894,"text":"A sale, lease, exchange or other disposition of the corporation’s assets, other than a disposition described in § 13.1-723, requires approval of the corporation’s shareholders if the disposition would leave the corporation without a significant continuing business activity. The corporation will conclusively be deemed to have retained a significant continuing business activity if it retains a business activity that represented, for the corporation and its subsidiaries on a consolidated basis, (i) at least 20 percent of total assets at the end of the most recently completed fiscal year, and (ii) at least 20 percent of either (a) income from continuing operations before taxes or (b) revenues from continuing operations, in each case for the most recently completed fiscal year.","type":"section","prefixes":["A"],"prefix":"A","entire_prefix":"A","prefix_anchor":"A","level":1,"next_prefix":"B"},"1":{"id":282895,"text":"A disposition that requires approval of the shareholders under subsection A shall be initiated by adoption of 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 submit 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 inform the shareholders of the basis for that determination.","type":"section","prefixes":["B"],"prefix":"B","entire_prefix":"B","prefix_anchor":"B","level":1,"prior_prefix":"A","next_prefix":"C"},"2":{"id":282896,"text":"The board of directors may set conditions for the approval of a disposition by the shareholders or the effectiveness of the disposition.","type":"section","prefixes":["C"],"prefix":"C","entire_prefix":"C","prefix_anchor":"C","level":1,"prior_prefix":"B","next_prefix":"D"},"3":{"id":282897,"text":"If a disposition is required to be approved by the shareholders and if the approval is to be sought at a shareholders’ meeting, the corporation shall notify each shareholder, whether or not entitled to vote, of the shareholders’ meeting at which the disposition is to be submitted for approval in accordance with § 13.1-658. The notice shall also state that the purpose, or one of the purposes, of the meeting is to consider the disposition and shall contain or be accompanied by a copy or summary of the agreement pursuant to which the disposition will be effected. If only a summary of the agreement is sent to shareholders, the corporation also shall send a copy of the agreement to any shareholder who requests it.","type":"section","prefixes":["D"],"prefix":"D","entire_prefix":"D","prefix_anchor":"D","level":1,"prior_prefix":"C","next_prefix":"E"},"4":{"id":282898,"text":"Unless the articles of incorporation or board of directors, acting pursuant to subsection C, requires a greater vote or a greater quorum, the approval of a disposition by the shareholders shall require at a meeting at which a quorum exists the approval of the holders of more than two-thirds of all the votes entitled to be cast on the disposition. The articles of incorporation may provide for a greater or lesser vote than that provided for in this subsection or a vote by separate voting groups so long as the vote provided for is not less than a majority of all the votes cast on the disposition by each voting group entitled to vote on the disposition at a meeting at which a quorum of the voting group exists.","type":"section","prefixes":["E"],"prefix":"E","entire_prefix":"E","prefix_anchor":"E","level":1,"prior_prefix":"D","next_prefix":"F"},"5":{"id":282899,"text":"Unless the parties to the disposition have agreed otherwise, after a disposition has been approved by the shareholders, and at any time before the disposition has been consummated, it may be abandoned without action by the shareholders, subject to any contractual rights of the parties to the disposition.","type":"section","prefixes":["F"],"prefix":"F","entire_prefix":"F","prefix_anchor":"F","level":1,"prior_prefix":"E","next_prefix":"G"},"6":{"id":282900,"text":"A disposition of assets in the course of dissolution under Article 16 (§ 13.1-742 et seq.) is not governed by this section.","type":"section","prefixes":["G"],"prefix":"G","entire_prefix":"G","prefix_anchor":"G","level":1,"prior_prefix":"F","next_prefix":"H"},"7":{"id":282901,"text":"The assets of a direct or indirect consolidated subsidiary shall be deemed to be the assets of the parent corporation for the purposes of this section.","type":"section","prefixes":["H"],"prefix":"H","entire_prefix":"H","prefix_anchor":"H","level":1,"prior_prefix":"G","next_prefix":"I"},"8":{"id":282902,"text":"Notwithstanding any other provision of this section, no corporation organized to conduct the business of a railroad or other public service or a banking business, or a savings institution, an industrial loan association or a credit union may sell, lease or exchange its properties for the conduct of such business in the Commonwealth except to a corporation of the Commonwealth organized for the same purpose or in the case of a bank to a savings and loan association or a corporation of the United States, and in the case of a savings and loan association to a bank or a corporation of the United States.","type":"section","prefixes":["I"],"prefix":"I","entire_prefix":"I","prefix_anchor":"I","level":1,"prior_prefix":"H"}},"ancestry":[{"id":16780,"edition_id":1,"name":"Disposition of Assets","identifier":"13","label":"article","depth":3,"order_by":1,"parent_id":12983,"metadata":{},"date_created":"2026-06-26 04:42:44","date_modified":"2026-06-26 04:42:44","permalink":{"id":150467,"object_type":"structure","relational_id":16780,"identifier":"13","token":"13.1\/9\/13","url":"\/13.1\/9\/13\/","edition_id":1,"permalink":0,"preferred":1}},{"id":12983,"edition_id":1,"name":"Virginia Stock Corporation Act","identifier":"9","label":"chapter","depth":2,"order_by":1,"parent_id":12744,"metadata":{},"date_created":"2026-06-26 03:44:06","date_modified":"2026-06-26 03:44:06","permalink":{"id":150163,"object_type":"structure","relational_id":12983,"identifier":"9","token":"13.1\/9","url":"\/13.1\/9\/","edition_id":1,"permalink":0,"preferred":1}},{"id":12744,"edition_id":1,"name":"Corporations","identifier":"13.1","label":"title","depth":1,"order_by":1,"parent_id":null,"metadata":{},"date_created":"2026-06-26 03:43:51","date_modified":"2026-06-26 03:43:51","permalink":{"id":147493,"object_type":"structure","relational_id":12744,"identifier":"13.1","token":"13.1","url":"\/13.1\/","edition_id":1,"permalink":0,"preferred":1}}],"structure_contents":[{"id":86592,"structure_id":16780,"section_number":"13.1-723","catch_line":"Disposition of assets not requiring shareholder approval","url":"\/13.1-723\/","token":"13.1\/9\/13\/13.1-723","metadata":false},{"id":78985,"structure_id":16780,"section_number":"13.1-724","catch_line":"Shareholder approval of certain dispositions","url":"\/13.1-724\/","token":"13.1\/9\/13\/13.1-724","metadata":false}],"previous_section":{"id":86592,"structure_id":16780,"section_number":"13.1-723","catch_line":"Disposition of assets not requiring shareholder approval","url":"\/13.1-723\/","token":"13.1\/9\/13\/13.1-723","metadata":false},"metadata":false,"official_url":"https:\/\/law.lis.virginia.gov\/vacode\/13.1-724\/","history_text":"

The record of this law\u2019s original creation isn\u2019t available online. It has been modified 9 times. Those modifications are cataloged by \u201cThe Acts of Assembly,\u201d a state publication, by year and chapter. Those modifications that can be read on the General Assembly\u2019s website will be linked accordingly. Those modifications are as follows: in 1954, chapter 499; in 1956, chapter 428; in 1968, chapter 109; in 1975, chapter 500; in 1985, chapter 522; in 1987, chapter 181; in 1996, chapter 77<\/a>; in 2005, chapter 765<\/a>; in 2019, chapter 734<\/a>.<\/p>","references":[{"id":70173,"section_number":"13.1-658","catch_line":"Notice of meeting","order_by":null,"url":"\/13.1-658\/"},{"id":65588,"section_number":"13.1-730","catch_line":"Right to appraisal","order_by":null,"url":"\/13.1-730\/"},{"id":54774,"section_number":"54.1-2353","catch_line":"Protection of the interests of associations; appointment of receiver for common interest community manager","order_by":null,"url":"\/54.1-2353\/"},{"id":61378,"section_number":"6.2-1205","catch_line":"Merger, consolidation or transfer of assets of insolvent or financially unstable savings institution; notice and hearing; final order; priorities; examinations of resulting institutions","order_by":null,"url":"\/6.2-1205\/"},{"id":64972,"section_number":"6.2-914","catch_line":"Merger or transfer of assets of insolvent bank","order_by":null,"url":"\/6.2-914\/"}],"refers_to":[{"id":70173,"section_number":"13.1-658","catch_line":"Notice of meeting","order_by":null,"url":"\/13.1-658\/"},{"id":86592,"section_number":"13.1-723","catch_line":"Disposition of assets not requiring shareholder approval","order_by":null,"url":"\/13.1-723\/"},{"id":78573,"section_number":"13.1-742","catch_line":"Dissolution by directors and shareholders","order_by":null,"url":"\/13.1-742\/"}],"permalink":{"id":150473,"object_type":"law","relational_id":78985,"identifier":"13.1-724","token":"13.1\/9\/13\/13.1-724","url":"\/13.1-724\/","edition_id":1,"permalink":0,"preferred":1},"url":"\/13.1-724\/","token":"13.1\/9\/13\/13.1-724","dublin_core":{"Title":"Shareholder approval of certain dispositions","Type":"Text","Format":"text\/html","Identifier":"\u00a7 13.1-724","Relation":"Code of Virginia"},"html":"\n\t\t\t\t\t\t

A.<\/span> A sale, lease, exchange or other disposition<\/span> of the corporation<\/span>’s assets<\/span>, other than a disposition<\/span> described in § 13.1-723<\/a>, requires approval of the corporation<\/span>’s shareholders<\/span> if the disposition<\/span> would leave the corporation<\/span> without a significant continuing business activity. The corporation<\/span> will conclusively be deemed to have retained a significant continuing business activity if it retains a business activity that represented, for the corporation<\/span> and its subsidiaries on a consolidated basis, (i) at least 20 percent of total assets<\/span> at the end of the most recently completed fiscal year, and (ii) at least 20 percent of either (a) income from continuing operations before taxes or (b) revenues from continuing operations, in each case for the most recently completed fiscal year. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

B.<\/span> A disposition<\/span> that requires approval of the shareholders<\/span> under subsection A shall be initiated by adoption of a resolution by the board of directors authorizing the disposition<\/span>. After adoption of such a resolution, the board of directors shall submit the proposed disposition<\/span> to the shareholders<\/span> for their approval. The board of directors shall also submit to the shareholders<\/span> a recommendation that the shareholders<\/span> approve the proposed disposition<\/span>, unless the board of directors makes a determination that because of conflicts of interest<\/span> or other special circumstances it should not make such a recommendation, in which case the board of directors shall inform the shareholders<\/span> of the basis for that determination. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

C.<\/span> The board of directors may set conditions for the approval of a disposition<\/span> by the shareholders<\/span> or the effectiveness of the disposition<\/span>. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

D.<\/span> If a disposition<\/span> is required to be approved by the shareholders<\/span> and if the approval is to be sought at a shareholders<\/span>’ meeting, the corporation<\/span> shall notify each shareholder<\/span>, whether or not entitled to vote, of the shareholders<\/span>’ meeting at which the disposition<\/span> is to be submitted for approval in accordance with § 13.1-658<\/a>. The notice shall also state<\/span> that the purpose, or one of the purposes, of the meeting is to consider the disposition<\/span> and shall contain or be accompanied by a copy or summary of the agreement pursuant to which the disposition<\/span> will be effected. If only a summary of the agreement is sent to shareholders<\/span>, the corporation<\/span> also shall send a copy of the agreement to any shareholder<\/span> who requests it. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

E.<\/span> Unless the articles of incorporation<\/span> or board of directors, acting pursuant to subsection C, requires a greater vote or a greater quorum, the approval of a disposition<\/span> by the shareholders<\/span> shall require at a meeting at which a quorum exists the approval of the holders of more than two-thirds of all the votes entitled to be cast on the disposition<\/span>. The articles of incorporation<\/span> may provide for a greater or lesser vote than that provided for in this subsection or a vote by separate voting groups<\/span> so long as the vote provided for is not less than a majority of all the votes cast on the disposition<\/span> by each voting group<\/span> entitled to vote on the disposition<\/span> at a meeting at which a quorum of the voting group<\/span> exists. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

F.<\/span> Unless the parties to the disposition<\/span> have agreed otherwise, after a disposition<\/span> has been approved by the shareholders<\/span>, and at any time before the disposition<\/span> has been consummated, it may be abandoned without action by the shareholders<\/span>, subject to any contractual rights of the parties to the disposition<\/span>. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

G.<\/span> A disposition<\/span> of assets<\/span> in the course of dissolution under Article 16 (§ 13.1-742<\/a> et seq.) is not governed by this section. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

H.<\/span> The assets<\/span> of a direct or indirect consolidated subsidiary shall be deemed to be the assets<\/span> of the parent corporation<\/span> for the purposes of this section. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

I.<\/span> Notwithstanding any other provision of this section, no corporation<\/span> organized to conduct the business of a railroad or other public service or a banking business, or a savings institution, an industrial loan association or a credit union may sell, lease or exchange its properties for the conduct of such business in the Commonwealth except to a corporation<\/span> of the Commonwealth organized for the same purpose or in the case of a bank to a savings and loan association or a corporation<\/span> of the United States<\/span>, and in the case of a savings and loan association to a bank or a corporation<\/span> of the United States<\/span>. <\/i><\/a><\/p><\/section>","plain_text":" CODE OF VIRGINIA\n\nSHAREHOLDER APPROVAL OF CERTAIN DISPOSITIONS (\u00a7 13.1-724)\n\nA. A sale, lease, exchange or other disposition of the corporation’s\nassets, other than a disposition described in § 13.1-723, requires approval\nof the corporation’s shareholders if the disposition would leave the\ncorporation without a significant continuing business activity. The corporation\nwill conclusively be deemed to have retained a significant continuing business\nactivity if it retains a business activity that represented, for the corporation\nand its subsidiaries on a consolidated basis, (i) at least 20 percent of total\nassets at the end of the most recently completed fiscal year, and (ii) at least\n20 percent of either (a) income from continuing operations before taxes or (b)\nrevenues from continuing operations, in each case for the most recently\ncompleted fiscal year.\n\nB. A disposition that requires approval of the shareholders under subsection A\nshall be initiated by adoption of a resolution by the board of directors\nauthorizing the disposition. After adoption of such a resolution, the board of\ndirectors shall submit the proposed disposition to the shareholders for their\napproval. The board of directors shall also submit to the shareholders a\nrecommendation that the shareholders approve the proposed disposition, unless\nthe board of directors makes a determination that because of conflicts of\ninterest or other special circumstances it should not make such a\nrecommendation, in which case the board of directors shall inform the\nshareholders of the basis for that determination.\n\nC. The board of directors may set conditions for the approval of a disposition\nby the shareholders or the effectiveness of the disposition.\n\nD. If a disposition is required to be approved by the shareholders and if the\napproval is to be sought at a shareholders’ meeting, the corporation shall\nnotify each shareholder, whether or not entitled to vote, of the\nshareholders’ meeting at which the disposition is to be submitted for\napproval in accordance with § 13.1-658. The notice shall also state that\nthe purpose, or one of the purposes, of the meeting is to consider the\ndisposition and shall contain or be accompanied by a copy or summary of the\nagreement pursuant to which the disposition will be effected. If only a summary\nof the agreement is sent to shareholders, the corporation also shall send a copy\nof the agreement to any shareholder who requests it.\n\nE. Unless the articles of incorporation or board of directors, acting pursuant\nto subsection C, requires a greater vote or a greater quorum, the approval of a\ndisposition by the shareholders shall require at a meeting at which a quorum\nexists the approval of the holders of more than two-thirds of all the votes\nentitled to be cast on the disposition. The articles of incorporation may\nprovide for a greater or lesser vote than that provided for in this subsection\nor a vote by separate voting groups so long as the vote provided for is not less\nthan a majority of all the votes cast on the disposition by each voting group\nentitled to vote on the disposition at a meeting at which a quorum of the voting\ngroup exists.\n\nF. Unless the parties to the disposition have agreed otherwise, after a\ndisposition has been approved by the shareholders, and at any time before the\ndisposition has been consummated, it may be abandoned without action by the\nshareholders, subject to any contractual rights of the parties to the\ndisposition.\n\nG. A disposition of assets in the course of dissolution under Article 16 (§\n13.1-742 et seq.) is not governed by this section.\n\nH. The assets of a direct or indirect consolidated subsidiary shall be deemed to\nbe the assets of the parent corporation for the purposes of this section.\n\nI. Notwithstanding any other provision of this section, no corporation organized\nto conduct the business of a railroad or other public service or a banking\nbusiness, or a savings institution, an industrial loan association or a credit\nunion may sell, lease or exchange its properties for the conduct of such\nbusiness in the Commonwealth except to a corporation of the Commonwealth\norganized for the same purpose or in the case of a bank to a savings and loan\nassociation or a corporation of the United States, and in the case of a savings\nand loan association to a bank or a corporation of the United States.\n\nHISTORY: Code 1950, \u00a7\u00a7 13-83, 13-84, 13.1-77; 1954, c. 499; 1956, c. 428;\n1968, c. 109; 1971, Ex. Sess., c. 117; 1975, c. 500; 1985, c. 522; 1987, c. 181;\n1996, c. 77; 2005, c. 765; 2019, c. 734.","edition":{"id":1,"name":"2025","slug":"2025","date_created":"2026-06-21 22:39:22","date_modified":"2026-06-21 22:39:22","current":1,"order_by":1,"last_import":null}}