Iowa Code 490.1402 – Dissolution by board of directors and shareholders
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1. The board of directors may propose dissolution for submission to the shareholders by first adopting a resolution authorizing the dissolution.
Terms Used In Iowa Code 490.1402
- Articles of incorporation: means the articles of incorporation described in section 490. See Iowa Code 490.140
- 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.
- 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
- Interest: means either or both of the following rights under the organic law governing an unincorporated entity:a. See Iowa Code 490.140
- Proceeding: includes a civil suit and criminal, administrative, and investigatory action. See Iowa Code 490.140
- Quorum: The number of legislators that must be present to do business.
- Shareholder: means a record shareholder. See Iowa Code 490.140
- state: when applied to the different parts of the United States, includes the District of Columbia and the territories, and the words "United States" may include the said district and territories. See Iowa Code 4.1
2. a. For a proposal to dissolve to be adopted, it shall then be approved by the shareholders. In submitting the proposal to dissolve to the shareholders for approval, the board of directors shall recommend that the shareholders approve the dissolution, unless any of the following apply:(1) The board of directors determines that because of conflict of interest or other special circumstances it should make no recommendation.(2) Section 490.826 applies.b. If paragraph “a”, subparagraph (1) or (2), applies, the board shall inform the shareholders of the basis for its so proceeding.3. The board of directors may set conditions for the approval of the proposal for dissolution by shareholders or the effectiveness of the dissolution.4. If the approval of the shareholders is to be given at a meeting, the corporation shall notify each shareholder, regardless of whether entitled to vote, of the meeting of shareholders at which the dissolution is to be submitted for approval. The notice must state that the purpose, or one of the purposes, of the meeting is to consider dissolving the corporation.5. Unless the articles of incorporation, bylaws, or the board of directors acting pursuant to subsection 3 require a greater vote, a greater quorum, or a vote by voting groups, adoption of the proposal to dissolve shall require the approval of the shareholders at a meeting at which a quorum exists consisting of a majority of the votes entitled to be cast on the proposal to dissolve.