What if someone offers to buy all of my corporation’s assets?

Your corporation can sell, lease, exchange, or otherwise transfer all or substantially all of its assets. See Cal. Corp. Code § 1001. Before a sale can go through, the board of directors must approve the terms and conditions, and the consideration (the money, securities, or other property) paid for the assets, as being in the corporation’s best interests. In addition, the transfer must be approved by the shareholders, unless the transaction is in the usual and regular course of the corporation’s business. A sale of all or substantially all of its assets is not normally in the usual and regular course of the corporation’s business, but it can happen if, for example, the corporation is selling its major assets as part of the process of modernizing its capital assets. Even after the approval of a proposed sale by shareholders, the board can still abandon the sale without going back to the shareholders, subject to the contractual rights, if any, of the purchasing party.