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California General Corporation Law

Allen Matkins

California May Soon Define "Corporation" To Include That Are Not Corporations

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The California Corporations Code is a misnomer.  While the Corporations Code does in fact govern corporations, it also governs a wide variety of unincorporated entities, including general partnerships, limited partnerships,...more

Allen Matkins

Does Amending A Shareholders Agreement Require Qualification Under The California Corporate Securities Law?

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A significant amount of background is required to answer the question of whether amending a shareholders agreement is subject to qualification under the California Corporate Securities Law.  As an initial matter, the CSL...more

Allen Matkins

Professor Bainbridge Queries Whether SB 313 Eviscerates Omnicare, But Does That Question Have Any Relevance To California...

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Delaware practitioners and legal scholars are digesting the implications of SB 313 which adds a new Section 122(18) to the Delaware General Corporation.  According to the bill's synopsis, this new provision...more

Allen Matkins

Is A Notitia Congregationis Valid In California?

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California is a very linguistically diverse state with an estimated 200 plus different languages being spoken.  Within my own family, English is not the primary language spoken at home by any of my grandchildren.  Yet, the...more

Allen Matkins

Directors Removing Directors

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Seven years ago, I addressed the question of whether the board of directors of a California corporation could remove a fellow director...more

Allen Matkins

Can Shareholders Elect Corporate Officers?

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The classic model of corporate governance is that the board of directors appoints and removes the principal corporate officers.  This is consistent with the general principle that the business and affairs of a corporation...more

Allen Matkins

Knowingly Offering A False Annual Statement For Filing With The Secretary Of State Is A Felony

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The Statement of Information required pursuant to California Corporations Code Section 1502 is not required to be signed under penalty of perjury.  However, the statute does require that the corporation (not the individual...more

Allen Matkins

When A California Corporation Converts To A California Limited Liability Company, What Happens To Its Nevada Business License?

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NRS 107.028(1)(d) requires that a trustee under a deed of trust be a "domestic or foreign entity which holds a current state business license issued by the Secretary of State pursuant to chapter 76 of NRS".   In Mahban v....more

Allen Matkins

Not Every California Corporation Is Governed By The California General Corporation Law

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The California General Corporation Law is part of the California Corporations Code, but not every corporation incorporated in California is formed or governed by the General Corporation Law.   In fact, the Corporations Code...more

Allen Matkins

What Egregious Error Have Courts Made Nearly 9,000 Times (And Counting)?

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In a recently published article, Professors Samantha J. Prince & Joshua P. Fershée focus on the propensity to conflate corporations with limited liability companies...more

Allen Matkins

Reverse Stock Splits And The California Corporate Securities Law

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Meredith Ervine recently wrote about reverse stock splits and Nasdaq listed issuers.  A reverse stock split is the "go to" solution for many listed issuers whose share prices fall below the minimum continued stock exchange...more

Allen Matkins

Is The General Counsel Ipso Facto A Corporate Officer?

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One difficulty of answering the question of whether a general counsel is a corporate officer is that the California General Corporation Law does not define "officer".  Corporations Code Section 312(a) requires a corporation...more

Allen Matkins

Why It Is Impossible To File Articles Of Incorporation And A Statement Of Information Simultaneously And A World Without Chevron

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A California corporation begins existence upon the filing of its articles of incorporation.  Cal. Corp. Code § 200(c).  The filing of initial articles of incorporation starts a 90 day clock on the filing of the newly hatched...more

Allen Matkins

I Say Again That Section 2116 Says Nothing About Officers

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Recently, I took note of the fact that the California Supreme Court as granted review of EpicentRx, In.c v. Superior Court, 95 Cal. App. 5th 890 (2023), review granted 539 P.3d 118 (2023).   This was a case that...more

Allen Matkins

If Corporate Charters Are Contracts, Must They Be Signed By The Corporation?

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Recently, Professor Ann Lipton wrote that the California Supreme Court has granted review of EpicentRx, In.c v. Superior Court, 95 Cal. App. 5th 890 (2023), review granted 539 P.3d 118 (2023).   This was a case that I...more

Allen Matkins

How Does One Serve A Dissolved Corporation?

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The California General Corporation Law provides that a California corporation that is dissolved continues to exist for the purpose of, among other things, defending actions against it.  Cal. Corp. Code § 2010(a).  This, of...more

Allen Matkins

What Public Corporation Exists Without Ever Filing Articles Of Incorporation?

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The California General Corporation Law providers that the corporate existence begins upon filing of the articles.  Cal. Corp. Code § 200(c).  However, some California corporations have been birthed without the filing of...more

Allen Matkins

Abandoning Cumulative Voting Does Not Extend Term Of Office

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In November 2018, the citizens of Mission Viejo elected three persons to the City Council for two-year terms of office, rather than four years as prescribed by California Government Code section 57377.  This was done pursuant...more

Allen Matkins

Court Rules Director Of California Corporation Has A Duty To Disclose When Soliciting Consents

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The California General Corporation Law permits shareholders to take action by written consent, unless otherwise provided in the articles of incorporation.  Cal. Corp. Code § 603(a).  When shareholder action is taken by...more

Allen Matkins

California Says Corporations And LLCs Can't Be Directors; The Securities Exchange Act Apparently Believes Otherwise

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Nine years ago, I posed the question of whether the California General Corporation Law permits corporations to serve as directors.  My answer at the time was "no" because Section 164 of the Corporations Code defines...more

Allen Matkins

How Long Is Six Months?

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Statutory time periods can be ambiguous.  For example, what does "six months" mean when one month has 28 or 29 days, other months have 30 days and still others have 31 days....more

Allen Matkins

May Directors Vote By Proxy?

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Neither California's nor Delaware's General Corporation Law expressly prohibits directors from being represented by proxy at board meetings.   However, it appears to have been well settled in Delaware since at least 1915 that...more

Allen Matkins

When May Shares Be Voted Without A Proxy Or Without Transfer Into The Holder's Name?

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In most cases, Generally speaking, only the record owners of shares on the record date are entitled to vote under the California General Corporation Law.  As with most generalizations, however, there are exceptions.  For...more

Allen Matkins

When Do Stock Splits, Reverse Stock Splits And The Like Become Effective?

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Section 908 of the California Corporations Code provides that when a California corporation files a certificate of amendment, the articles of incorporation shall be amended in accordance with the certificate and any stock...more

Allen Matkins

California Nonprofit and Cooperative Corporations Will Soon Be Able To Fix Otherwise Lawful Corporate Actions

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In 2022, the California legislature enacted amendments to the California General Corporation Law allowing corporations formed under that law to ratify or validate otherwise lawful corporate actions.   2022 Cal. Stats.  Ch....more

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