Section 10A-20-5.03

Disposition of property of educational corporations where the stockholders are unknown or the number of shares is unknown.

(a) Where the charter of any educational corporation organized under the laws of this state, general or special, provides for the issuance of stock and the stockholders are unknown or where the amount or number of shares are unknown, the property of the corporation may be disposed of as follows: The acting trustees or directors having peaceable charge of the business and property of the corporation, whether legally elected or not, may contract to sell or otherwise dispose of the property of the corporation in the manner as they may deem best to carry out the purpose of the corporation, which action must be concurred in by a majority of the acting trustees or directors.

(b) Within 30 days after making the contract or agreement, the trustees or directors shall cause to be filed in the name of the corporation, in the circuit court of the county in which the property or the principal part thereof is situated, a petition in writing, verified by affidavit, setting forth the purposes of the corporation and that the stockholders are unknown or that the amount or number of shares are unknown, setting out the sale or disposition contemplated and that, in the judgment of the trustees or a majority of them, the disposition is best to carry out the purposes of the corporation. If any of the stockholders are known, the petition shall also set out their names and residence if known.

(c) On the filing of the petition, the register or clerk shall cause publication to be made as to unknown or nonresident stockholders as provided by law for publication as to nonresidents on the filing of complaints, he or she shall issue a summons to all resident stockholders named in the petition, which shall be served as other summons and the same proceedings had as to all the known stockholders named in the petition as provided for complaints.

(d) Within the time allowed for pleading to complaints, any known or unknown stockholder may come in and propound a claim and contest the disposition if he or she deems proper, and the petition shall be heard as other complaints, and the disposition confirmed or set aside, or the disposition made, of the property as the equities of the case may require.

(e) If the petition is not contested within the time allowed for pleading to complaints, the same may be submitted to the judge on affidavits and the charter of the corporation, or a certified copy thereof, and the judge may enter an order thereon ratifying the sale or disposition, or modifying the same and prescribing the terms and restrictions as the judge may deem best for carrying out the purposes of the corporation and authorizing a conveyance of the property by the trustees or the president and secretary of the board, which shall convey to the grantee all the title of the corporation or of any stockholder thereof in the property subject to the restrictions contained in the order or the judge may refuse to ratify the disposition.

(f) If any money is paid under the order, the same shall be paid to the register or clerk to be distributed under the orders of the court to the parties entitled thereto on proper proof.

(g) Any party contesting the petition may, at any time within 42 days after the entry of the order, prosecute an appeal to the Supreme Court as on final judgments in accordance with the Alabama Rules of Appellate Procedure, and the appeal may also be taken by the acting trustees or directors in the name of the corporation.

(Acts 1911, No. 277, p. 327; Code 1923, §§7076-7082; Code 1940, T. 10, §§161-167; §10-4-82; amended and renumbered by Act 2009-513, p. 967, §332.)