Governor Brown Signs Flexible Purpose And Benefit Corporation Bills – Confusion To Follow

A Tale of Two Bills

In an action that is likely to lead to concern, confusion and consternation, Governor Brown has signed not one, but two bills that will allow for the formation of corporations that combine profitability with public or other purposes.

Flexible Purpose Corporations

SB 201 (DeSaulnier) was the handiwork of a working group of lawyers who worked for over a year to write a new division to the California Corporations Code to provide for the formation and operation of flexible purpose corporations. Far from operating in secrecy, the working group published a draft of the bill and solicited comments. When Senator Mark DeSaulnier introduced the bill, moreover, he included the proposed substantive text for all the world to see.

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Published In: Business Organization Updates, Elections & Politics Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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