Corporate Sale of Substantially All Assets Approval Requirements in South Carolina

At a glance

Requirements one by one

South Carolina uses a qualitative trigger and no percentage test

S.C. Code Ann. § 33-12-102(a) applies to a sale, lease, exchange, or other disposition of all or substantially all corporate property, with or without goodwill, outside the usual and regular course. The statute states no significant-continuing-activity, percentage, consolidated-basis, subsidiary- valuation, or investment-holding test.

Section 33-12-103 defines “sale” for Chapter 12 to include the disposition verbs but exclude a mortgage or other security interest. Whether actual property and operations meet the qualitative threshold remains a separate question.

The board recommends or explains why it does not

The board proposes the transaction and determines its terms, conditions, and consideration. Under § 33-12-102(b), it recommends the proposal unless conflict of interest or other special circumstances justify no recommendation; it then communicates its basis with shareholder submission. The board may condition its submission on any basis.

Every shareholder receives a transaction description

Section 33-12-102(d) requires notice to each shareholder whether or not entitled to vote. It must state that considering the disposition is a meeting purpose and contain or accompany a transaction description. S.C. Code Ann. § 33-7-105 supplies the 10-to-60-day interval. The transaction statute does not separately require a summary of terms, conditions, or consideration.

No-meeting action under § 33-7-104 requires signed written consent from every shareholder entitled to vote. Because Chapter 12 requires nonvoter notice, those holders receive written notice and the meeting-equivalent materials at least 10 days before unanimous-consent action.

Two-thirds is the default, but a majority is the floor

Section 33-12-102(e)-(f) defaults to two-thirds of all votes entitled to be cast. The articles may lower or raise that vote or require voting groups, but cannot go below a majority of all entitled votes. The board may impose a greater vote as a submission condition. The section states no automatic voting-group vote.

The private-company subsidiary route is narrow

S.C. Code Ann. § 33-12-101 lets the board authorize an all-or-substantially-all disposition in the usual and regular course and any mortgage, pledge, debt dedication, or other encumbrance, unless the articles require shareholder approval.

Its wholly owned corporation route applies only to a statutory “public corporation”—one with a federally registered class of equity securities. It is not a general wholly owned subsidiary exception for the ordinary private corporation in this survey. A transaction that constitutes a distribution uses § 33-6-400 rather than § 33-12-102; the approval section states no general dissolution or court-order exception.

Authorization preserves an exit, subject to contracts

After authorization, § 33-12-102(g) permits abandonment without another shareholder action, subject to contractual rights. Chapter 12 states no separate statutory agreement execution, filing, amendment, or closing process.

Dissent uses a narrower transaction list

Section 33-13-102 grants an eligible voter dissent rights on consummation of an outside-course sale or exchange of all or substantially all property. Unlike the approval section, it does not name lease or other disposition. It includes a sale in dissolution but excludes a court-ordered sale and a cash sale under a plan requiring distribution of all or substantially all net proceeds within one year. Shares listed on a national exchange or designated national-market-system security are excluded.

Sections 33-13-200 to -220 require the meeting notice to flag the right and carry the dissent chapter. A claimant gives written intent before the vote and does not vote in favor, subject to the corporate-proxy exception. The corporation sends the dissenters' notice within 10 days after action; it fixes a demand deadline 30 to 60 days after delivery and a certificate-deposit date no earlier than 20 days after the demand date.

What trips people up

• The default denominator is all votes entitled. Two-thirds of votes present or cast is not enough.
• The wholly owned route is public-company only. “Public corporation” is a defined federal-registration status, not every for-profit corporation.
• Approval and dissent use different verb lists. Approval reaches a lease or other disposition; the ordinary dissent trigger names sale or exchange.

Common questions

May the articles reduce the two-thirds vote?

Yes, but not below a majority of all votes entitled to be cast. They may also raise the vote or require voting groups.

Does a mortgage require the extraordinary-disposition vote?

Not ordinarily. Section 33-12-101 makes an encumbrance board-authorized unless the articles require shareholder approval, and § 33-12-103 excludes a mortgage or security interest from Chapter 12's defined “sale.”

Can the corporation abandon after approval?

Yes. Section 33-12-102(g) permits abandonment without further shareholder action, subject to contractual rights.

Statutes and sources

• S.C. Code Ann. §§ 33-1-400 and 33-6-400 — corporation, public-corporation, voting-group, distribution definitions and distribution authority. Official Title 33 Chapter 1 and Chapter 6, accessed September 5, 2026.
• S.C. Code Ann. §§ 33-7-104 to -105 and 33-12-101 to -103 — consent, notice, board-only transactions, approval trigger, recommendation, vote, abandonment, and transaction definition. Official Chapter 7 and Chapter 12, accessed September 5, 2026.
• S.C. Code Ann. § 33-13-102 and §§ 33-13-200 to -220 — dissent eligibility, exclusions, notice, intent, demand, and certificate timing. Official Title 33 Chapter 13, accessed September 5, 2026.