citation: CORP § 2112

text:
(a) Subject to Section 2113, a foreign corporation which has qualified to transact intrastate business may surrender its right to engage in that business within this state by filing a certificate of surrender signed by a corporate officer or, in the case of a foreign association that has no officers, signed by a trustee stating:

(1) The name of the corporation as shown on the records of the Secretary of State, and the state or place of incorporation or organization.

(2) That it revokes its designation of agent for service of process.

(3) That it surrenders its authority to transact intrastate business.

(4) That it consents that process against it in any action upon any liability or obligation incurred within this state before the filing of the certificate of surrender may be served upon the Secretary of State.

(5) A post office address to which the Secretary of State may mail a copy of any process against the corporation that is served upon the Secretary of State, which address or the name to which the process should be sent may be changed from time to time by filing a statement signed by a corporate officer or, in the case of a foreign association that has no officers, signed by a trustee stating the new address or name or both.

(6) Except in the case of a foreign association, that a final franchise tax return, as described by Section 23332 of the Revenue and Taxation Code, has been or will be filed with the Franchise Tax Board, as required under Part 10.2 (commencing with Section 18401) of Division 2 of the Revenue and Taxation Code.

(b) The Secretary of State shall notify the Franchise Tax Board of the surrender.

history: (History: Amended by Stats. 2022, Ch. 617, Sec. 37. (SB 1202) Effective January 1, 2023.)

title: 1. CORPORATIONS


kind: section

code: CORP

citation: CORP § 2113

text:
(a) The filing of an agreement of merger of a foreign disappearing corporation qualified to transact intrastate business in this state pursuant to Section 1103, or the filing pursuant to subdivision (d) of Section 1108 of an agreement, certificate, or other document as to a merger that includes a disappearing foreign corporation qualified to transact intrastate business, or the filing of a certificate of ownership as to a foreign subsidiary corporation qualified to transact intrastate business in this state pursuant to Section 1110, or the filing by a foreign corporation qualified to transact intrastate business in this state of an organizational document containing a statement of conversion pursuant to Section 15911.08, 16908, or 17710.08, constitutes the surrender by the foreign corporation of its right to engage in intrastate business within this state.

(b) With respect to corporations for which documents have not been filed as provided in subdivision (a), a certificate of surrender as prescribed by Section 2112 shall be filed by a foreign corporation qualified to transact intrastate business upon its merger into another foreign corporation.

(c) In lieu of a signature as prescribed by Section 2112, a certificate of surrender pursuant to subdivision (b) for a merged foreign corporation may be signed in the name of the surviving corporation by an officer thereof. In that case, the certificate of surrender shall be accompanied by a certificate of an authorized public official of the state or place of incorporation of the merged foreign corporation stating that the corporation has been merged into another foreign corporation and setting forth the name and state or place of incorporation of the surviving foreign corporation.

history: (History: Amended by Stats. 2012, Ch. 419, Sec. 10. (SB 323) Effective January 1, 2013. Operative January 1, 2014, by Sec. 32 of Ch. 419.)

division: 1. GENERAL CORPORATION LAW

title: 1. CORPORATIONS

chapter: 21. Foreign Corporations

path: 1. CORPORATIONS > 1. GENERAL CORPORATION LAW > 21. Foreign Corporations


citation: CORP § 2114

text:
(a) A foreign corporation that has transacted intrastate business and has thereafter withdrawn from business in this state may be served with process in the manner provided in this chapter in any action brought in this state arising out of that business, whether or not it has ever complied with the requirements of this chapter.

(b) A foreign corporation that has surrendered its right to transact intrastate business pursuant to Section 2112 or 2113 may be served with process in any action upon a liability or obligation incurred within this state prior to that surrender by delivery of the process to the Secretary of State, or an assistant or a deputy to the Secretary of State pursuant to this chapter and no court order authorizing this service shall be required. The process shall be mailed in the manner prescribed in this chapter except that it shall be sent to the address to which process is authorized to be sent in the certificate of surrender or to the address of the surviving domestic corporation in the case of a surrender under Section 2113.

(c) If a foreign corporation that is qualified to transact intrastate business has its right to transact such business forfeited by the Franchise Tax Board pursuant to the Bank and Corporation Tax Law (Part 11 (commencing with Section 23001) of Division 2 of the Revenue and Taxation Code), service of process on that corporation may be effected in the manner set forth in Sections 2110 and 2111, as if the right to transact intrastate business had not been forfeited.

(d) The fact that a corporation ceases to transact intrastate business without filing a certificate of surrender does not revoke the appointment of any agent for the service of process.

history: (History: Amended by Stats. 1997, Ch. 187, Sec. 5. Effective January 1, 1998.)

title: 1. CORPORATIONS


citation: CORP § 2115

text:
(a) A foreign corporation (other than a foreign association or foreign nonprofit corporation but including a foreign parent corporation even though it does not itself transact intrastate business) is subject to the requirements of subdivision (b) commencing on the date specified in subdivision (d) and continuing until the date specified in subdivision (e) if:

(1) The average of the property factor, the payroll factor, and the sales factor (as defined in Sections 25129, 25132, and 25134 of the Revenue and Taxation Code) with respect to it is more than 50 percent during its latest full income year and

(2) more than one-half of its outstanding voting securities are held of record by persons having addresses in this state appearing on the books of the corporation on the record date for the latest meeting of shareholders held during its latest full income year or, if no meeting was held during that year, on the last day of the latest full income year. The property factor, payroll factor, and sales factor shall be those used in computing the portion of its income allocable to this state in its franchise tax return or, with respect to corporations the allocation of whose income is governed by special formulas or that are not required to file separate or any tax returns, which would have been so used if they were governed by this three-factor formula. The determination of these factors with respect to any parent corporation shall be made on a consolidated basis, including in a unitary computation (after elimination of intercompany transactions) the property, payroll, and sales of the parent and all of its subsidiaries in which it owns directly or indirectly more than 50 percent of the outstanding shares entitled to vote for the election of directors, but deducting a percentage of the property, payroll, and sales of any subsidiary equal to the percentage minority ownership, if any, in the subsidiary. For the purpose of this subdivision, any securities held to the knowledge of the issuer in the names of broker-dealers, nominees for broker-dealers (including clearing corporations), or banks, associations, or other entities holding securities in a nominee name or otherwise on behalf of a beneficial owner (collectively “nominee holders”), shall not be considered outstanding. However, if the foreign corporation requests all nominee holders to certify, with respect to all beneficial owners for whom securities are held, the number of shares held for those beneficial owners having addresses (as shown on the records of the nominee holder) in this state and outside of this state, then all shares so certified shall be considered outstanding and held of record by persons having addresses either in this state or outside of this state as so certified, provided that the certification so provided shall be retained with the record of shareholders and made available for inspection and copying in the same manner as is provided in Section 1600 with respect to that record. A current list of beneficial owners of a foreign corporation’s securities provided to the corporation by one or more nominee holders or their agent pursuant to the requirements of Rule 14b-1(b)(3) or 14b-2(b)(3) as adopted on January 6, 1992, promulgated under the Securities Exchange Act of 1934, shall constitute an acceptable certification with respect to beneficial owners for the purposes of this subdivision.

(b) Except as provided in subdivision (c), the following chapters and sections of this division shall apply to a foreign corporation as defined in subdivision (a) (to the exclusion of the law of the jurisdiction in which it is incorporated):

Chapter 1 (general provisions and definitions), to the extent applicable to the following provisions;

Section 301 (annual election of directors);

Section 303 (removal of directors without cause);

Section 304 (removal of directors by court proceedings);

Section 305, subdivision (c) (filling of director vacancies where less than a majority in office elected by shareholders);

Section 309 (directors’ standard of care);

Section 316 (excluding paragraph (3) of subdivision (a) and paragraph (3) of subdivision (f)) (liability of directors for unlawful distributions);

Section 317 (indemnification of directors, officers, and others);

Sections 500 to 505, inclusive (limitations on corporate distributions in cash or property);

Section 506 (liability of shareholder who receives unlawful distribution);

Section 600, subdivisions (b) and (c) (requirement for annual shareholders’ meeting and remedy if same not timely held);

Section 708, subdivisions (a), (b), and (c) (shareholder’s right to cumulate votes at any election of directors);

Section 710 (supermajority vote requirement);

Section 1001, subdivision (d) (limitations on sale of assets);

Section 1101, subdivision (b) (limitations on mergers);

Section 1151 (first sentence only) (limitations on conversions);

Section 1152 (requirements of conversions);

Chapter 12 (commencing with Section 1200) (reorganizations);

Chapter 13 (commencing with Section 1300) (dissenters’ rights);

Sections 1500 and 1501 (records and reports);

Section 1508 (action by Attorney General);

Chapter 16 (commencing with Section 1600) (rights of inspection).

(c) This section does not apply to any corporation (1) with outstanding securities listed on the New York Stock Exchange, the NYSE American, the NASDAQ Global Market, or the NASDAQ Capital Market, or (2) if all of its voting shares (other than directors’ qualifying shares) are owned directly or indirectly by a corporation or corporations not subject to this section.

(d) For purposes of subdivision (a), the requirements of subdivision (b) shall become applicable to a foreign corporation only upon the first day of the first income year of the corporation (1) commencing on or after the 135th day of the income year immediately following the latest income year with respect to which the tests referred to in subdivision (a) have been met or (2) commencing on or after the entry of a final order by a court of competent jurisdiction declaring that those tests have been met.

(e) For purposes of subdivision (a), the requirements of subdivision (b) shall cease to be applicable to a foreign corporation (1) at the end of the first income year of the corporation immediately following the latest income year with respect to which at least one of the tests referred to in subdivision (a) is not met or (2) at the end of the income year of the corporation during which a final order has been entered by a court of competent jurisdiction declaring that one of those tests is not met, provided that a contrary order has not been entered before the end of the income year.

(f) Any foreign corporation that is subject to the requirements of subdivision (b) shall advise any shareholder of record, any officer, director, employee, or other agent (within the meaning of Section 317) and any creditor of the corporation in writing, within 30 days of receipt of written request for that information, whether or not it is subject to subdivision (b) at the time the request is received. Any party who obtains a final determination by a court of competent jurisdiction that the corporation failed to provide to the party information required to be provided by this subdivision or provided the party information of the kind required to be provided by this subdivision that was incorrect, then the court, in its discretion, shall have the power to include in its judgment recovery by the party from the corporation of all court costs and reasonable attorneys’ fees incurred in that legal proceeding to the extent they relate to obtaining that final determination.

history: (History: Amended by Stats. 2022, Ch. 617, Sec. 38. (SB 1202) Effective January 1, 2023.)

title: 1. CORPORATIONS


text:
(a) Section 301.3 shall apply to a foreign corporation that is a publicly held corporation to the exclusion of the law of the jurisdiction in which the foreign corporation is incorporated.

(b) For purposes of this section, a “publicly held corporation” means a foreign corporation with outstanding shares listed on a major United States stock exchange.

history: (History: Added by Stats. 2018, Ch. 954, Sec. 3. (SB 826) Effective January 1, 2019.)

title: 1. CORPORATIONS


text:
(a) Section 301.4 shall apply to a foreign corporation that is a publicly held corporation to the exclusion of the law of the jurisdiction in which the foreign corporation is incorporated.

(b) For purposes of this section, a “publicly held corporation” means a foreign corporation with outstanding shares listed on a major United States stock exchange.

history: (History: Added by Stats. 2020, Ch. 316, Sec. 4. (AB 979) Effective January 1, 2021.)

title: 1. CORPORATIONS


citation: CORP § 2116

text: The directors of a foreign corporation transacting intrastate business are liable to the corporation, its shareholders, creditors, receiver, liquidator or trustee in bankruptcy for the making of unauthorized dividends, purchase of shares or distribution of assets or false certificates, reports or public notices or other violation of official duty according to any applicable laws of the state or place of incorporation or organization, whether committed or done in this state or elsewhere. Such liability may be enforced in the courts of this state.

history: (History: Added by Stats. 1975, Ch. 682.)

title: 1. CORPORATIONS


citation: CORP § 2117

text:
(a) Every foreign corporation (other than a foreign association) qualified to transact intrastate business shall file, within 90 days after the filing of its original statement and designation of foreign corporation and annually thereafter during the applicable filing period, on a form prescribed by the Secretary of State, a statement containing all of the following:

(1) The name of the corporation as registered in California and the California Secretary of State’s file number.

(2) The names and complete business or residence addresses of its chief executive officer, secretary, and chief financial officer.

(3) The street address of its principal executive office.

(4) The mailing address of the corporation, if different from the street address of its principal executive office.

(5) The street address of its principal business office in this state, if any.

(6) If the corporation chooses to receive renewal notices and any other notifications from the Secretary of State by electronic mail instead of by United States mail, the corporation shall include a valid electronic mail address for the corporation or for the corporation’s designee to receive those notices.

(7) A statement of the general type of business that constitutes the principal business activity of the corporation, such as, for example, manufacturer of aircraft, wholesale liquor distributor, or retail department store.

(8) A statement indicating whether any officer or any director has an outstanding final judgment issued by the Division of Labor Standards Enforcement or a court of law, for which no appeal therefrom is pending, for the violation of any wage order or provision of the Labor Code.

(b) The statement required by subdivision (a) shall also designate, as the agent of the corporation for the purpose of service of process, a natural person residing in this state or a corporation that has complied with Section 1505 and whose capacity to act as the agent has not terminated. If a natural person is designated, the statement shall set forth the person’s complete business or residence street address. If a corporate agent is designated, no address for it shall be set forth.

(c) The statement required by subdivision (a) shall be available and open to the public for inspection. The Secretary of State shall provide access to all information contained in the statement by means of an online database.

(d) In addition to any other fees required, a foreign corporation shall pay a five-dollar ($5) disclosure fee upon filing the statement required by subdivision (a). One-half of the fee shall, notwithstanding Section 12176 of the Government Code, be deposited into the Business Programs Modernization Fund established in subdivision (k) of Section 1502, and one-half shall be deposited into the Victims of Corporate Fraud Compensation Fund established in Section 2280.

(e) Whenever any of the information required by subdivision (a) is changed, the corporation may file a current statement containing all the information required by subdivisions (a) and (b). In order to change its agent for service of process or the address of the agent, the corporation shall file a current statement containing all the information required by subdivisions (a) and (b). Whenever any statement is filed pursuant to this section, it supersedes any previously filed statement and the statement in the filing pursuant to Section 2105.

(f) Subdivisions (c), (d), (f), and (g) of Section 1502 apply to statements filed pursuant to this section, except that “articles” shall mean the filing pursuant to Section 2105, and “corporation” shall mean a foreign corporation.

(g) (1) This section shall become operative on January 1, 2022, or upon certification by the Secretary of State that California Business Connect is implemented, whichever date is earlier.

(2) If the Secretary of State certifies California Business Connect is implemented prior to January 1, 2022, the Secretary of State shall post notice of the certification on the homepage of its internet website and send notice of the certification to the Legislative Counsel.

history: (History: Repealed (in Sec. 3) and added by Stats. 2020, Ch. 357, Sec. 4. (AB 3075) Effective January 1, 2021. Conditionally operative on or before January 1, 2022, by its own provisions.)

title: 1. CORPORATIONS


text:
(a) In addition to the statement required pursuant to Section 2117, every publicly traded foreign corporation shall file annually, within 150 days after the end of its fiscal year, on a form prescribed by the Secretary of State, a statement that includes all of the following information:

(1) The name of the independent auditor that prepared the most recent auditor’s report on the publicly traded foreign corporation’s annual financial statements.

(2) A description of other services, if any, performed for the publicly traded foreign corporation during its two most recent fiscal years and the period between the end of its most recent fiscal year and the date of the statement by the foregoing independent auditor, by its parent corporation, or by a subsidiary or corporate affiliate of the independent auditor or its parent corporation.

(3) The name of the independent auditor employed by the foreign corporation on the date of the statement, if different from the independent auditor listed pursuant to paragraph (1).

(4) The compensation for the most recent fiscal year of the publicly traded foreign corporation paid to each member of the board of directors and paid to each of the five most highly compensated executive officers of the foreign corporation who are not members of the board of directors, including the number of any shares issued, options for shares granted, and similar equity-based compensation granted to each of those persons. If the chief executive officer is not among the five most highly compensated executive officers of the corporation, the compensation paid to the chief executive officer shall also be included.

(5) A description of any loan, including the amount and terms of the loans, made to any member of the board of directors by the publicly traded foreign corporation during the foreign corporation’s two most recent fiscal years at an interest rate lower than the interest rate available from unaffiliated commercial lenders generally to a similarly situated borrower.

(6) A statement indicating whether an order for relief has been entered in a bankruptcy case with respect to the foreign corporation, its executive officers, or members of the board of directors of the foreign corporation during the 10 years preceding the date of the statement.

(7) A statement indicating whether any member of the board of directors or executive officer of the publicly traded foreign corporation was convicted of fraud during the 10 years preceding the date of the statement, which conviction has not been overturned or expunged.

(8) A description of any material pending legal proceedings, other than ordinary routine litigation incidental to the business, to which the corporation or any of its subsidiaries is a party or of which any of their property is the subject, as specified by Item 103 of Regulation S-K of the Securities and Exchange Commission (Section 229.103 of Title 12 of the Code of Federal Regulations). A description of any material legal proceeding during which the corporation was found legally liable by entry of a final judgment or final order that was not overturned on appeal during the five years preceding the date of the statement.

(b) For purposes of this section, the following definitions apply:

(1) “Publicly traded foreign corporation” means a foreign corporation, as defined in Section 171, that is an issuer as defined in Section 3 of the Securities Exchange Act of 1934, as amended (15 U.S.C. Sec. 78c), and has at least one class of securities listed or admitted for trading on a national securities exchange, on the OTC Bulletin Board, or on the electronic service operated by OTC Markets Group Inc.

(2) “Executive officer” means the chief executive officer, president, any vice president in charge of a principal business unit, division, or function, any other officer of the corporation who performs a policymaking function, or any other person who performs similar policymaking functions for the corporation.

(3) “Compensation” as used in paragraph (4) of subdivision (a) means all plan and nonplan compensation awarded to, earned by, or paid to the person for all services rendered in all capacities to the corporation and to its subsidiaries, as the compensation is specified by Item 402 of Regulation S-K of the Securities and Exchange Commission (Section 229.402 of Title 17 of the Code of Federal Regulations).

(4) “Loan” as used in paragraph (5) of subdivision (a) excludes an advance for expenses, the foreign corporation’s payment of life insurance premiums, and an advance of litigation expenses, in each instance as permitted according to the applicable law of the state or place of incorporation or organization of the foreign corporation.

(c) This statement shall be available and open to the public for inspection. The Secretary of State shall provide access to all information contained in this statement by means of an online database.

(d) A foreign corporation shall certify that the information it provides pursuant to this section is true and correct. No claim may be made against the state for inaccurate information contained in statements filed under this section with the Secretary of State.

history: (History: Amended by Stats. 2019, Ch. 143, Sec. 27. (SB 251) Effective January 1, 2020.)

title: 1. CORPORATIONS


citation: CORP § 2200

text:
Every corporation that neglects, fails, or refuses: (a) to keep or cause to be kept or maintained the record of shareholders or books of account required by this division to be kept or maintained, (b) to prepare or cause to be prepared or submitted the financial statements required by this division to be prepared or submitted, or (c) to give any shareholder of record the advice required by subdivision (f) of Section 2115, is subject to penalty as provided in this section.

The penalty shall be twenty-five dollars ($25) for each day that the failure or refusal continues, up to a maximum of one thousand five hundred dollars ($1,500), beginning 30 days after receipt of the written request that the duty be performed from one entitled to make the request, except that, in the case of a failure to give advice required by subdivision (f) of Section 2115, the 30-day period shall run from the date of receipt of the request made pursuant to subdivision (f) of Section 2115, and no additional request is required by this section.

The penalty shall be paid to the shareholder or shareholders jointly making the request for performance of the duty, and damaged by the neglect, failure, or refusal, if suit therefor is commenced within 90 days after the written request is made, including any request made pursuant to subdivision (f) of Section 2115; but the maximum daily penalty because of failure to comply with any number of separate requests made on any one day or for the same act shall be two hundred fifty dollars ($250).

history: (History: Amended by Stats. 2001, Ch. 159, Sec. 44. Effective January 1, 2002.)

title: 1. CORPORATIONS

chapter: 22. Crimes and Penalties

path: 1. CORPORATIONS > 1. GENERAL CORPORATION LAW > 22. Crimes and Penalties


citation: CORP § 2201

text:
Any officer of a corporation charged with the duty of entering a transfer of shares upon the books of the corporation and issuing a share certificate or, with respect to uncertificated securities, an initial transaction statement or written statements, who unreasonably neglects, fails or refuses to perform such duty after written request by any person entitled thereto is subject to a penalty of one hundred dollars ($100) and the further penalty of ten dollars ($10) for each day that such default continues, beginning five days after receipt of the request, up to a maximum of five hundred dollars ($500). The penalty shall be paid to each person aggrieved. It may be enforced by action and shall be in addition to all other remedies.

Every director or other officer unreasonably causing such neglect, failure or refusal to make such entries upon the books of the corporation or to issue a certificate or, with respect to uncertificated securities, an initial transaction statement or written statements, for shares to a person entitled thereto is subject to a like penalty.

history: (History: Amended by Stats. 1986, Ch. 766, Sec. 27.)

title: 1. CORPORATIONS


citation: CORP § 2202

text:
Any penalty prescribed by Section 2200 or Section 2201 shall be in addition to any remedy by injunction or action for damages or by writ of mandate for the nonperformance of acts and duties enjoined by law upon the corporation or its directors or officers.

The court in which an action for any such penalty is brought may reduce, remit or suspend the penalty on such terms and conditions as it may deem reasonable when it is made to appear that the neglect, failure or refusal was inadvertent or excusable.

history: (History: Repealed and added by Stats. 1975, Ch. 682.)

title: 1. CORPORATIONS


citation: CORP § 2203

text:
(a) Any foreign corporation which transacts intrastate business and which does not hold a valid certificate from the Secretary of State may be subject to a penalty of twenty dollars ($20) for each day that unauthorized intrastate business is transacted; and the foreign corporation, by transacting unauthorized intrastate business, shall be deemed to consent to the jurisdiction of the courts of California in any civil action arising in this state in which the corporation is named a party defendant.

(b) The penalty established by subdivision (a) of this section shall be assessed according to the number of days it is found that the corporation has been willfully doing unauthorized intrastate business. Prosecution under this section may be brought, and the money penalty recovered thereby shall be paid, in the manner provided by Section 2258 for a prosecution brought under that section. The amount of the penalty assessed shall be determined by the court based upon the circumstances, including the size of the corporation and the willfulness of the violation.

(c) A foreign corporation subject to the provisions of Chapter 21 (commencing with Section 2100) which transacts intrastate business without complying with Section 2105 shall not maintain any action or proceeding upon any intrastate business so transacted in any court of this state, commenced prior to compliance with Section 2105, until it has complied with the provisions thereof and has paid to the Secretary of State a penalty of two hundred fifty dollars ($250) in addition to the fees due for filing the statement and designation required by Section 2105 and has filed with the clerk of the court in which the action is pending receipts showing the payment of the fees and penalty and all franchise taxes and any other taxes on business or property in this state that should have been paid for the period during which it transacted intrastate business.

history: (History: Amended by Stats. 1990, Ch. 926, Sec. 1.)

title: 1. CORPORATIONS


citation: CORP § 2204

text:
(a) Upon the failure of a corporation to file the statement required by Section 1502, the Secretary of State shall provide a notice of that delinquency to the corporation. The notice shall also contain information concerning the application of this section, advise the corporation of the penalty imposed by Section 19141 of the Revenue and Taxation Code for failure to timely file the required statement after notice of the delinquency has been provided by the Secretary of State, and shall advise the corporation of its right to request relief from the Secretary of State because of reasonable cause or unusual circumstances that justify the failure to file. If, within 60 days of providing notice of the delinquency, a statement pursuant to Section 1502 has not been filed by the corporation, the Secretary of State shall certify the name of the corporation to the Franchise Tax Board.

(b) Upon certification pursuant to subdivision (a), the Franchise Tax Board shall assess against the corporation the penalty provided in Section 19141 of the Revenue and Taxation Code.

(c) The penalty herein provided shall not apply to a corporation that on or prior to the date of certification pursuant to subdivision (a) has dissolved, has converted to another type of business entity, or has been merged into another corporation or other business entity.

(d) The penalty herein provided shall not apply and the Secretary of State need not provide a notice of the delinquency to a corporation if the corporate powers, rights, and privileges have been suspended by the Franchise Tax Board pursuant to Section 23301, 23301.5, or 23775 of the Revenue and Taxation Code on or prior to, and remain suspended on, the last day of the filing period pursuant to Section 1502. The Secretary of State need not provide notice of the filing requirement pursuant to Section 1502 to a corporation if the corporate powers, rights, and privileges have been so suspended by the Franchise Tax Board on or prior to, and remain suspended on, the day the Secretary of State prepares the notice for sending.

(e) If, after certification pursuant to subdivision (a), the Secretary of State finds (1) the required statement was filed before the expiration of the 60-day period after providing notice of the delinquency, or (2) the failure to provide notice of delinquency was due to an error of the Secretary of State, the Secretary of State shall promptly decertify the name of the corporation to the Franchise Tax Board. The Franchise Tax Board shall then promptly abate any penalty assessed against the corporation pursuant to Section 19141 of the Revenue and Taxation Code.

(f) If the Secretary of State determines that the failure of a corporation to file the statement required by Section 1502 is excusable because of reasonable cause or unusual circumstances that justify the failure, the Secretary of State may waive the penalty imposed by this section and by Section 19141 of the Revenue and Taxation Code, in which case the Secretary of State shall not certify the name of the corporation to the Franchise Tax Board, or if already certified, the Secretary of State shall promptly decertify the name of the corporation.

history: (History: Amended by Stats. 2014, Ch. 834, Sec. 8. (SB 1041) Effective January 1, 2015.)

title: 1. CORPORATIONS


citation: CORP § 2205

text:
(a) A corporation that (1) fails to file a statement pursuant to Section 1502 for an applicable filing period, (2) has not filed a statement pursuant to Section 1502 during the preceding 24 months, and (3) was certified for penalty pursuant to Section 2204 for the same filing period, is subject to suspension pursuant to this section rather than to penalty pursuant to Section 2204.

(b) When subdivision (a) is applicable, the Secretary of State shall provide a notice to the corporation informing the corporation that its corporate powers, rights, and privileges will be suspended after 60 days if it fails to file a statement pursuant to Section 1502.

(c) After the expiration of the 60-day period without any statement filed pursuant to Section 1502, the Secretary of State shall notify the Franchise Tax Board of the suspension and provide a notice of the suspension to the corporation, and thereupon, the corporate powers, rights, and privileges of the corporation are suspended, except for the purpose of filing an application for exempt status or amending the articles of incorporation as necessary either to perfect that application or to set forth a new name.

(d) A statement pursuant to Section 1502 may be filed notwithstanding suspension of the corporate powers, rights, and privileges pursuant to this section or Section 23301, 23301.5, or 23775 of the Revenue and Taxation Code. Upon the filing of a statement pursuant to Section 1502 by a corporation that has suffered suspension pursuant to this section, the Secretary of State shall certify that fact to the Franchise Tax Board and the corporation may thereupon be relieved from suspension unless the corporation is held in suspension by the Franchise Tax Board by reason of Section 23301, 23301.5, or 23775 of the Revenue and Taxation Code.

history: (History: Amended by Stats. 2011, Ch. 204, Sec. 6. (AB 657) Effective January 1, 2012.)

title: 1. CORPORATIONS


text:
(a) A domestic corporation, as defined in Section 167, may be subject to administrative dissolution pursuant to this section if, as of January 1, 2019, or at any time thereafter, the corporation’s corporate powers, rights, and privileges are, and have been, suspended by the Franchise Tax Board pursuant to Article 7 (commencing with Section 23301) of Chapter 2 of Part 11 of Division 2 of the Revenue and Taxation Code for a period of not less than 60 continuous months.

(b) Prior to administrative dissolution of the corporation, the corporation shall be notified of the pending administrative dissolution as follows:

(1) The Franchise Tax Board shall mail written notice to the last known address of the corporation.

(2) If the corporation does not have a valid address in the records of the Franchise Tax Board, the notice provided in subdivision (d) shall be deemed sufficient notice prior to administrative dissolution.

(c) The Franchise Tax Board shall transmit to the Secretary of State the names and Secretary of State file numbers of the corporations subject to administrative dissolution pursuant to this section.

(d) The Secretary of State shall provide 60 days’ notice of the pending administrative dissolution on its Internet Web site by listing the corporation’s name and the Secretary of State’s file number. The Secretary of State shall also, in conjunction with the information above, provide instructions for a corporation to submit a written objection of the pending administrative dissolution to the Franchise Tax Board, before the expiration of the 60 day’s notice.

(e) (1) A corporation may provide the Franchise Tax Board with a written objection to the administrative dissolution.

(2) The Franchise Tax Board shall notify the Secretary of State if a written objection has been received.

(f) If a written objection to the administrative dissolution is not received by the Franchise Tax Board during the 60-day period described in subdivision (d), the corporation shall be administratively dissolved pursuant to this section. The certificate of dissolution of the Secretary of State shall be prima facie evidence of the administrative dissolution.

(g) (1) If the written objection of a corporation to the administrative dissolution has been received by the Franchise Tax Board before the expiration of the 60-day period described in subdivision (d), that corporation shall have an additional 90 days from the date the written objection is received by the Franchise Tax Board to file returns, pay or otherwise satisfy all accrued taxes, penalties, and interest, file a current Statement of Information with the Secretary of State, fulfill any other requirements to be eligible, and apply for revivor.

(2) (A) If the conditions in paragraph (1) are satisfied, the administrative dissolution shall be canceled.

(B) If the conditions in paragraph (1) are not satisfied, the corporation shall be administratively dissolved pursuant to this section as of the later of the date that is 90 days after the receipt of the written objection or after the period in paragraph (3), if so extended.

(3) The Franchise Tax Board may extend the 90-day period in paragraph (1), but for no more than one period of 90 days.

(h) Upon administrative dissolution pursuant to this section, the corporation’s liabilities for qualified taxes, interest, and penalties, as defined in paragraph (2) of subdivision (b) of Section 23310 of the Revenue and Taxation Code, if any, shall be abated. Any actions taken by the Franchise Tax Board to collect the abated liability shall be released, withdrawn, or otherwise terminated by the Franchise Tax Board and no subsequent administrative or civil action shall be taken or brought to collect all or part of that amount.

(i) If the corporation is administratively dissolved pursuant to this section, the liability to creditors, if any, is not discharged. The liability of the directors, shareholders, transferees, or other persons related to the administratively dissolved corporation is not discharged.

(j) The administrative dissolution of a corporation pursuant to this section shall not diminish or adversely affect the ability of the Attorney General to enforce liabilities as otherwise provided by law.

(k) No administrative appeal, writ, or other judicial action may be taken based on the Franchise Tax Board’s or the Secretary of State’s actions pursuant to this section, except pursuant to subdivision (h) if related to repayment of amounts erroneously received after administrative dissolution has occurred.

(l) Upon administrative dissolution, the corporate rights, powers, and privileges of the corporation shall cease.

history: (History: Added by Stats. 2018, Ch. 679, Sec. 1. (AB 2503) Effective January 1, 2019.)

title: 1. CORPORATIONS


citation: CORP § 2206

text:
(a) Sections 2204 and 2205 apply to foreign corporations with respect to the statements required to be filed by Section 2117. For this purpose, the suspension of the corporate powers, rights, and privileges of a domestic corporation shall mean the forfeiture of the exercise of the corporate powers, rights, and privileges of a foreign corporation in this state.

(b) A foreign nonprofit corporation which has suffered the forfeiture of the exercise of the corporate powers, rights, and privileges in this state may nevertheless file an application for exempt status as specified in Section 23301 of the Revenue and Taxation Code.

(c) The forfeiture of the exercise of the corporate powers, rights, and privileges of a foreign corporation in this state as used in subdivision (a) does not prohibit the transaction of business in this state by a foreign corporation if the business transacted subsequent to the forfeiture would not, considered as an entirety, require the foreign corporation to obtain a certificate of qualification pursuant to Sections 191 and 2105.

history: (History: Added by Stats. 1985, Ch. 764, Sec. 8. Operative July 1, 1986, by Sec. 11 of Ch. 764.)

title: 1. CORPORATIONS


citation: CORP § 2207

text:
(a) A corporation is liable for a civil penalty in an amount not exceeding one million dollars ($1,000,000) if the corporation does both of the following:

(1) Has actual knowledge that an officer, director, manager, or agent of the corporation does any of the following:

(A) Makes, publishes, or posts, or has made, published, or posted, either generally or privately to the shareholders or other persons, either of the following:

(i) An oral, written, or electronically transmitted report, exhibit, notice, or statement of its affairs or pecuniary condition that includes a material statement or omission that is false and intended to give the shares of stock in the corporation a materially greater or a materially less apparent market value than they really possess.

(ii) An oral, written, or electronically transmitted report, prospectus, account, or statement of operations, values, business, profits, or expenditures, that includes a material false statement or omission intended to give the shares of stock in the corporation a materially greater or a materially less apparent market value than they really possess.

(B) Refuses, or has refused to make, any book entry or post any notice required by law in the manner required by law.

(C) Misstates or conceals, or has misstated or concealed, from a regulatory body a material fact in order to deceive a regulatory body to avoid a statutory or regulatory duty, or to avoid a statutory or regulatory limit or prohibition.

(2) Within 30 days after actual knowledge is acquired of the actions described in paragraph (1), the corporation knowingly fails to do both of the following:

(A) Notify the Attorney General or appropriate government agency in writing, unless the corporation has actual knowledge that the Attorney General or appropriate government agency has been notified.

(B) Notify its shareholders in writing, unless the corporation has actual knowledge that the shareholders have been notified.

(b) The requirement for notification under this section does not apply if the action taken or about to be taken by the corporation, or by an officer, director, manager, or agent of the corporation under paragraph (1) of subdivision (a), is abated within the time prescribed for reporting, unless the appropriate government agency requires disclosure by regulation.

(c) If the action reported to the Attorney General pursuant to this section implicates the government authority of an agency other than the Attorney General, the Attorney General shall promptly forward the written notice to that agency.

(d) If the Attorney General was not notified pursuant to subparagraph (A) of paragraph (2) of subdivision (a), but the corporation reasonably and in good faith believed that it had complied with the notification requirements of this section by notifying a government agency listed in paragraph (5) of subdivision (e), no penalties shall apply.

(e) For purposes of this section:

(1) “Manager” means a person having both of the following:

(A) Management authority over a business entity.

(B) Significant responsibility for an aspect of a business that includes actual authority for the financial operations or financial transactions of the business.

(2) “Agent” means a person or entity authorized by the corporation to make representations to the public about the corporation’s financial condition and who is acting within the scope of the agency when the representations are made.

(3) “Shareholder” means a person or entity that is a shareholder of the corporation at the time the disclosure is required pursuant to subparagraph (B) of paragraph (2) of subdivision (a).

(4) “Notify its shareholders” means to give sufficient description of an action taken or about to be taken that would constitute acts or omissions as described in paragraph (1) of subdivision (a). A notice or report filed by a corporation with the United States Securities and Exchange Commission that relates to the facts and circumstances giving rise to an obligation under paragraph (1) of subdivision (a) shall satisfy all notice requirements arising under paragraph (2) of subdivision (a), but is not the exclusive means of satisfying the notice requirements, if the Attorney General or appropriate agency is informed in writing that the filing has been made together with a copy of the filing or an electronic link where it is available online without charge.

(5) “Appropriate government agency” means an agency on the following list that has regulatory authority with respect to the financial operations of a corporation:

(A) Department of Financial Protection and Innovation.

(B) Department of Insurance.

(C) Department of Managed Health Care.

(D) United States Securities and Exchange Commission.

(6) “Actual knowledge of the corporation” means the knowledge an officer or director of a corporation actually possesses or does not consciously avoid possessing, based on an evaluation of information provided pursuant to the corporation’s disclosure controls and procedures.

(7) “Refuse to make a book entry” means the intentional decision not to record an accounting transaction when all of the following conditions are satisfied:

(A) The independent auditors required recordation of an accounting transaction during the course of an audit.

(B) The corporation’s audit committee has not approved the independent auditor’s recommendation.

(C) The decision is made for the primary purpose of rendering the financial statements materially false or misleading.

(8) “Refuse to post any notice required by law” means an intentional decision not to post a notice required by law when all of the following conditions exist:

(A) The decision not to post the notice has not been approved by the corporation’s audit committee.

(B) The decision is intended to give the shares of stock in the corporation a materially greater or a materially less apparent market value than they really possess.

(9) “Misstate or conceal material facts from a regulatory body” means an intentional decision not to disclose material facts when all of the following conditions exist:

(A) The decision not to disclose material facts has not been approved by the corporation’s audit committee.

(B) The decision is intended to give the shares of stock in the corporation a materially greater or a materially less apparent market value than they really possess.

(10) “Material false statement or omission” means an untrue statement of material fact or an omission to state a material fact necessary in order to make the statements made under the circumstances under which they were made not misleading.

(11) “Officer” means any person as set forth in Rule 16a-1 promulgated under the Securities Exchange Act of 1934 or any successor regulation thereto, except an officer of a subsidiary corporation who is not also an officer of the parent corporation.

(f) This section only applies to corporations that are issuers, as defined in Section 2 of the Sarbanes-Oxley Act of 2002 (15 U.S.C. Sec. 7201 et seq.).

(g) An action to enforce this section may only be brought by the Attorney General or a district attorney or city attorney in the name of the people of the state.

history: (History: Amended by Stats. 2022, Ch. 452, Sec. 49. (SB 1498) Effective January 1, 2023.)

title: 1. CORPORATIONS


citation: CORP § 2251

text: Any promoter, director or officer of a corporation who knowingly and willfully issues or consents to the issuance of certificates for certificated securities, or initial transaction statements or written statements for uncertificated securities, in violation of this division with intent to defraud present or future shareholders, subscribers, purchasers of shares or creditors is guilty of a misdemeanor punishable by a fine of not more than one thousand dollars ($1,000) or imprisonment for not more than one year or both.

history: (History: Amended by Stats. 1986, Ch. 766, Sec. 28.)

title: 1. CORPORATIONS


citation: CORP § 2252

text: Every person (a) who signs the name of a fictitious person to any subscription for or agreement to take stock in any domestic or foreign corporation, existing or proposed, or (b) who signs to any subscription or agreement the name of any person, knowing that the person has no means or does not intend in good faith to comply with all the terms thereof or that there is any understanding or agreement that the terms of the subscription or agreement are not to be complied with or enforced, is guilty of a misdemeanor.

title: 1. CORPORATIONS


citation: CORP § 2253

text: Any director of a stock corporation, domestic or foreign, who concurs in any vote or act of the directors of the corporation or any of them, knowingly and with dishonest or fraudulent purpose, to make any dividend or distribution of assets except in the cases and in the manner allowed by law, either with the design of defrauding creditors or shareholders or of giving a false appearance to the value of the stock and thereby defrauding subscribers or purchasers, is guilty of a misdemeanor, punishable by a fine of not more than one thousand dollars ($1,000) or imprisonment for not more than one year or both.

title: 1. CORPORATIONS


citation: CORP § 2254

text: Every director, officer or agent of any corporation, domestic or foreign, is guilty of a felony (a) who knowingly concurs in making, publishing or posting either generally or privately to the shareholders or other persons (1) any written report, exhibit, statement of its affairs or pecuniary condition or notice containing any material statement which is false, or (2) any untrue or willfully or fraudulently exaggerated report, prospectus, account, statement of operations, values, business, profits, expenditures or prospects, or (3) any other paper or document intended to produce or give, or having a tendency to produce or give, the shares of stock in such corporation a greater value or a less apparent or market value than they really possess, or (b) who refuses to make any book entry or post any notice required by law in the manner required by law.

title: 1. CORPORATIONS


citation: CORP § 2255

text:
(a) Every director, officer or agent of any corporation, domestic or foreign, who knowingly receives or acquires possession of any property of the corporation, otherwise than in payment of a just demand, and, with intent to defraud, omits to make, or to cause or direct to be made, a full and true entry thereof in the books or accounts of the corporation is guilty of a public offense.

(b) Every director, officer, agent or shareholder of any corporation, domestic or foreign, who, with intent to defraud, destroys, alters, mutilates or falsifies any of the books, papers, writings or securities belonging to the corporation or makes or concurs in omitting to make any material entry in any book of accounts or other record or document kept by the corporation is guilty of a public offense.

(c) Each public offense specified in this section is punishable by imprisonment pursuant to subdivision (h) of Section 1170 of the Penal Code, or by imprisonment in a county jail not exceeding one year, or a fine not exceeding one thousand dollars ($1,000), or by both that fine and imprisonment.

history: (History: Amended by Stats. 2011, Ch. 15, Sec. 38. (AB 109) Effective April 4, 2011. Operative October 1, 2011, by Sec. 636 of Ch. 15, as amended by Stats. 2011, Ch. 39, Sec. 68.)

title: 1. CORPORATIONS


citation: CORP § 2256

text: Every officer, agent or clerk of any corporation, domestic or foreign, or any person proposing to organize such a corporation or to increase the capital stock of any such corporation, who knowingly exhibits any false, forged or altered book, paper, voucher, security or other instrument of evidence to any public officer or board authorized by law to examine the organization of such corporation or to investigate its affairs or to allow an increase of its capital, with intent to deceive such officer or board in respect thereto, is punishable by imprisonment pursuant to subdivision (h) of Section 1170 of the Penal Code, or by imprisonment in a county jail for not exceeding one year.

history: (History: Amended by Stats. 2011, Ch. 15, Sec. 39. (AB 109) Effective April 4, 2011. Operative October 1, 2011, by Sec. 636 of Ch. 15, as amended by Stats. 2011, Ch. 39, Sec. 68.)

title: 1. CORPORATIONS


citation: CORP § 2257

text: Every person who, without being authorized so to do, subscribes the name of another to or inserts the name of another in any prospectus, circular or other advertisement or announcement of any corporation, domestic or foreign, whether existing or intended to be formed, with intent to permit the document to be published and thereby to lead persons to believe that the person whose name is so subscribed is an officer, agent, shareholder or promoter of such corporation, when in fact no such relationship exists to the knowledge of such person, is guilty of a misdemeanor.

title: 1. CORPORATIONS


citation: CORP § 2258

text:
Any foreign corporation subject to the provisions of Chapter 21 which transacts intrastate business without complying therewith is guilty of a misdemeanor, punishable by fine of not less than five hundred dollars ($500) nor more than one thousand dollars ($1,000), to be recovered in any court of competent jurisdiction.

Prosecution under this section may be brought by the Attorney General or by any district attorney. If brought by the latter, one-half of the fine collected shall be paid to the treasurer of the county in which the conviction was had and one-half to the State Treasurer. If brought by the Attorney General the entire amount of fine collected shall be paid to the State Treasurer to the credit of the General Fund of the state.

title: 1. CORPORATIONS


citation: CORP § 2259

text: Any person who transacts intrastate business on behalf of a foreign corporation which is not authorized to transact such business in this state, knowing that it is not so authorized, is guilty of a misdemeanor punishable by fine of not less than fifty dollars ($50) nor more than six hundred dollars ($600).

history: (History: Amended by Stats. 1983, Ch. 1092, Sec. 75. Effective September 27, 1983. Operative January 1, 1984, by Sec. 427 of Ch. 1092.)

title: 1. CORPORATIONS


citation: CORP § 2260

text: In a prosecution for a violation of Section 2252, 2253, 2254, 2255, 2256 or 2257, the fact that the corporation was a foreign corporation is not a defense, if it was carrying on business or keeping an office therefor within this state.

history: (History: Amended by Stats. 1976, Ch. 641.)

title: 1. CORPORATIONS


citation: CORP § 2280

text: The Victims of Corporate Fraud Compensation Fund is hereby established in the State Treasury. The fund shall be administered by the Secretary of State for the sole purpose of providing restitution to the victims of a corporate fraud. The Secretary of State shall adopt regulations in furtherance of the administration of this chapter. Notwithstanding Section 13340 of the Government Code, the money in the fund is continuously appropriated to the Secretary of State for the purposes authorized by this chapter.

history: (History: Added by Stats. 2012, Ch. 564, Sec. 4. (SB 1058) Effective January 1, 2013.)

title: 1. CORPORATIONS

path: 1. CORPORATIONS > 1. GENERAL CORPORATION LAW > 22.5. Victims of Corporate Fraud Compensation Fund


citation: CORP § 2281

text:
As used in this chapter:

(a) “Agent” means a person who was an officer or director of a corporation, as defined in subdivision (e), at the time the fraudulent acts occurred, was named in a final criminal restitution order in connection with the fraudulent acts, and was acting in the person’s capacity as the corporation’s officer or director when committing the fraudulent acts.

(b) “Application” means a request for payment from the fund submitted to the Secretary of State pursuant to this chapter.

(c) “Claimant” means an aggrieved person who resides in the state at the time of the fraud and who submits an application pursuant to this chapter.

(d) “Complaint,” for the purpose of an application based on a criminal restitution order, means the facts of the underlying transaction or transactions upon which the criminal restitution order is based.

(e) “Corporation” means a domestic corporation as defined by Section 162 or 2509 or a foreign corporation that is qualified to transact business in California pursuant to Section 2105.

(f) “Court of competent jurisdiction” means a state or federal court situated in California.

(g) “Final judgment” means a judgment, arbitration award, or criminal restitution order for which appeals have been exhausted or for which the period for appeal has expired, enforcement of which is not barred by the order of any court or by any statutory provision, which has not been nullified or rendered void by any court order or statutory provision, and for which the claimant has not otherwise been fully reimbursed. The following are examples of final judgments:

(1) A civil judgment that has been entered against a corporation for fraud, misrepresentation, or deceit, with the intent to defraud, and includes findings of facts and conclusions of law.

(2) If the matter was submitted to arbitration, a copy of the arbitration decision and any other documentation supporting the arbitration award. An arbitration award against a corporation for conduct constituting fraud, misrepresentation, or deceit, with the intent to defraud, that includes findings of fact and conclusions of law rendered in accordance with the rules established by the American Arbitration Association or another recognized arbitration body, and in accordance with Sections 1280 to 1294.2, inclusive, of the Code of Civil Procedure where applicable, and where the arbitration award has been confirmed and reduced to judgment pursuant to Section 1287.4 of the Code of Civil Procedure.

(3) A criminal restitution order issued by a court of competent jurisdiction against a corporation, or an agent of the corporation, for fraud, misrepresentation, or deceit, with the intent to defraud, pursuant to subdivision (f) of Section 1202.4 of the Penal Code or Section 3663 of Title 18 of the United States Code. An application for payment from the fund that is based on a criminal restitution order shall comply with all of the requirements of this chapter.

(h) “Fund” means the Victims of Corporate Fraud Compensation Fund created by Section 2280.

(i) “Judgment debtor” means a corporation or agent against which a judgment, arbitration award, or criminal restitution order has been entered for conduct constituting intentional fraud.

history: (History: Amended by Stats. 2016, Ch. 390, Sec. 1. (AB 2759) Effective January 1, 2017.)

title: 1. CORPORATIONS

chapter: 22.5. Victims of Corporate Fraud Compensation Fund


citation: CORP § 2282

text:
(a) When an aggrieved person obtains a final judgment in a court of competent jurisdiction against a corporation based upon the corporation’s fraud, misrepresentation, or deceit, made with intent to defraud, or obtains a criminal restitution order against an agent based upon the agent's fraud, misrepresentation, or deceit, made with intent to defraud while acting in the agent’s capacity as the corporation’s officer or director, the aggrieved person may, upon the judgment becoming final and after diligent collection efforts are made, file an application with the Secretary of State for payment from the fund, within the limitations specified in Section 2289, for the amount unpaid on the judgment that represents the awarded actual and direct loss, any awarded compensatory damages, and awarded costs to the claimant in the final judgment, excluding punitive damages.

(b) The application shall be delivered in person or by certified mail to the Secretary of State not later than 18 months after the judgment has become final.

(c) The application shall be made on a form prescribed by the Secretary of State and shall include each of the following:

(1) The name and address of the claimant.

(2) If the claimant is represented by an attorney for the application, the name, business address, and telephone number of the attorney. If the claimant is not represented by an attorney for the application, a telephone number where the claimant can be reached during regular business hours shall be included.

(3) The name and address of the corporation and the agent, if any.

(4) The identification of the final judgment, the amount of the claim that remains unreimbursed from any source, and an explanation of the claim’s computation.

(5) A copy of a final judgment and a copy of the civil complaint and any amendments thereto upon which the judgment finding fraud, misrepresentation, or deceit, made with the intent to defraud, was made shall be deemed to satisfy compliance with the requirements prescribed in this paragraph. The claimant may also provide any additional documentation that he or she believes may help the Secretary of State in evaluating the application, including, but not limited to, evidence submitted to the court in the underlying judgment or a detailed narrative statement of facts in explanation of the allegations of the complaint upon which the underlying judgment is based.

(6) If the final judgment is a criminal restitution order, the claimant shall provide the charging document and the restitution order, and if the defendant is an agent, documentation showing the defendant named in the restitution order is an agent as defined in this chapter.

(7) A description of searches and inquiries conducted by or on behalf of the claimant with respect to the judgment debtor’s assets liable to be sold or applied to satisfaction of the judgment. A court’s determination or finding of the judgment debtor’s insolvency or lack of assets to pay the claimant shall be deemed to satisfy the requirements prescribed in this paragraph.

(8) Each of the following representations by the claimant:

(A) That the claimant is not a spouse, registered domestic partner, or an immediate family member of an employee, officer, director, managing agent, or other principal of the corporation nor a personal representative of the spouse, registered domestic partner, or an immediate family member of an employee, officer, director, managing agent, or other principal of the corporation.

(B) That the claimant has complied with all of the requirements of this section.

(C) That the judgment underlying the claim meets the requirements of subdivisions (a) and (b), including all of the following:

(i) That the judgment was for fraud, misrepresentation, or deceit by the corporation or the agent of the corporation, with the intent to defraud.

(ii) That the judgment is unpaid in part or in whole.

(iii) That the underlying judgment and debt have not been discharged in bankruptcy, or the underlying judgment is statutorily nondischargeable, or, in the case of a bankruptcy proceeding that is open at or after the time of the filing of the application, that the judgment and debt have been declared to be nondischargeable by the judge or stipulated as nondischargeable by the parties in the proceeding and that the claimant has been granted permission by the bankruptcy court to proceed with collection or otherwise proceed with the claimant’s claims against the judgment debtor or debtors.

(D) That the claimant does not have a pending claim and has not collected on the final judgment from any other restitution fund. If the claimant has a pending claim or has collected from another fund, a description of the nature of the pending claim and the recovery amounts from any restitution fund.

(d) (1) Except as provided in paragraphs (2), (3), and (4) the Secretary of State shall not condition an award of payment from the fund upon a claimant providing any additional information or documents other than those prescribed in subdivision (c).

(2) If the final judgment in favor of the claimant was by default, stipulated, a consent judgment, or pursuant to Section 594 of the Code of Civil Procedure or if the action against the corporation or its agent was defended by a trustee in bankruptcy, the Secretary of State may request additional documents and information from the claimant to determine whether the claim is valid.

(3) If the final judgment does not expressly set forth the amount of damages that were awarded for actual loss and compensatory damages that are payable from the fund pursuant to Section 2289, the Secretary of State may ask the claimant to provide copies of documentation pertaining to the amount of the actual and direct loss and the awarded compensatory damages or both of those findings. For purposes of this section, “sufficient proof of money damages” may include any of the following: copies of bank account statements showing or confirming particular transactions, copies of the front and back of checks made payable to the corporation that have been negotiated, credit card statements showing or confirming particular transactions, or similar documentation demonstrating financial loss directly resulting from the fraudulent acts by the corporation or its agent and the amount of compensatory damages awarded by the court.

(4) If there is no court determination or finding of the insolvency of the judgment debtor or lack of assets to pay the claimant, the Secretary of State may request additional information and documentation from the claimant to determine what assets, if any, are available to satisfy the final judgment.

(e) The Secretary of State shall include with the application form a notice to the claimant of his or her obligation to protect the underlying judgment from discharge in bankruptcy, to be appended to the application.

(f) If a claimant is a spouse, registered domestic partner, or an immediate family member of an employee, officer, director, managing agent, or other principal of the corporation, or is a personal representative of the spouse, registered domestic partner, or an immediate family member of an employee, officer, director, managing agent, or other principal of the corporation, the claimant shall not be precluded for that reason alone from receiving an award where the claimant can otherwise meet the requirements of this section.

history: (History: Amended by Stats. 2017, Ch. 561, Sec. 25. (AB 1516) Effective January 1, 2018.)

title: 1. CORPORATIONS


text:
(a) The Secretary of State shall provide notice to the corporation and all agents named in the application that a claimant has submitted an application for payment from the fund and shall also provide within that notice, as prescribed by the Secretary of State, the method to contest the payment from the fund.

(b) The notice to the corporation shall be provided by certified mail addressed to the corporation’s last designated agent for service of process of record with the Secretary of State and notice shall be deemed complete five calendar days after the notice is mailed.

(c) If the corporation or its agent wishes to contest payment of an application by the Secretary of State, the corporation or agent shall mail or deliver a written response addressed to the Secretary of State within 30 calendar days of the notice of the application, and shall mail or deliver a copy of the response to the claimant. The written response of the corporation or agent shall not be directed to issues and facts conclusively established by the underlying judgment. If the corporation fails to mail or deliver a timely response, the corporation shall have waived the corporation’s right to present objections to payment of the application, and shall not thereafter be entitled to notice of any action taken or proposed to be taken by the Secretary of State with respect to the application.

history: (History: Amended by Stats. 2016, Ch. 390, Sec. 3. (AB 2759) Effective January 1, 2017.)

title: 1. CORPORATIONS


text:
(a) The response by the corporation shall be by an officer or director and shall contain proof of service showing that a copy of the response was sent to the claimant, or if the claimant is represented by an attorney for purposes of the application, to the claimant’s attorney, at the address specified in the application for the claimant or the claimant’s attorney, respectively.

(b) If the corporation is not represented by an attorney in objecting to payment of the application, the response shall contain the name, title, and address of the officer, director, managing agent, or other responsible person authorized to represent the corporation and the address at which the corporation wishes to receive correspondence and notices relating to the application, and a telephone number at which the corporation’s representative can be reached during regular business hours. If the corporation is represented by an attorney in objecting to the application, the response shall contain the name, business address, and telephone number of the attorney.

title: 1. CORPORATIONS


citation: CORP § 2283

text:
(a) If the Secretary of State determines that the application, as submitted by the claimant, fails to comply with the requirements of Section 2282, the Secretary of State shall, within 21 calendar days after receipt of the application by a single claimant or within 40 calendar days after receipt of the application by multiple claimants, mail an itemized list of deficiencies to the claimant.

(b) The time within which the Secretary of State is required to act under Section 2284 shall be measured from the date of receipt by the Secretary of State of a completed application. In the event of an irreconcilable dispute between the claimant and the Secretary of State on the question of whether the application is complete, the claimant may immediately file the claim with the court pursuant to Section 2287.

(c) If the Secretary of State has mailed one or more itemized lists of deficiencies to a claimant, and, if after 30 calendar days the Secretary of State has not received a response to the latest list of deficiencies, the Secretary of State shall notify the claimant that, unless the claimant responds to the deficiencies within a specified period of time of not less than 15 calendar days, the application will be denied.

title: 1. CORPORATIONS


citation: CORP § 2284

text:
(a) The Secretary of State shall render a final written decision on the application within 90 calendar days after a completed application has been received unless the claimant agrees in writing to extend the time within which the Secretary of State may render a decision.

(b) The Secretary of State may deny or grant the application or may enter into a compromise with the claimant to pay less in settlement than the full amount of the claim. If the claimant refuses to accept a settlement of the claim offered by the Secretary of State, the written decision of the Secretary of State shall be to deny the claim. Evidence of settlement offers and discussions between the Secretary of State and the claimant shall not be competent evidence in judicial proceedings undertaken by the claimant pursuant to Section 2287.

(c) Upon issuance of a proposed decision to award payment or an offer to compromise, the claimant shall have 60 calendar days from the date of service of the proposed award or offer to compromise to accept the proposed award or offer to compromise. If the claimant fails to accept the proposed award or offer to compromise within the specified time, the application shall be deemed denied.

title: 1. CORPORATIONS


citation: CORP § 2285

text: The Secretary of State shall give written notice, as prescribed by the Secretary of State, of a decision rendered with respect to the application to the claimant.

title: 1. CORPORATIONS


citation: CORP § 2286

text: The Secretary of State shall give notice, as prescribed by the Secretary of State, to the corporation and all agents named in the application that the Secretary of State has made a decision to award funds to the claimant and shall provide a copy of the decision to the corporation and all agents named in the application.

history: (History: Amended by Stats. 2016, Ch. 390, Sec. 4. (AB 2759) Effective January 1, 2017.)

title: 1. CORPORATIONS


citation: CORP § 2287

text:
(a) A claimant against whom the Secretary of State has rendered a decision denying an application may, within six months after the mailing of the notice of the denial, file a verified petition in superior court for an Order Directing Payment Out of the Victims of Corporate Fraud Compensation Fund based upon the grounds set forth in the application to the Secretary of State. If the underlying judgment is a California state court judgment, the petition shall be filed in the court in which the underlying judgment was entered. If the underlying judgment is not a California state court judgment or is a federal court judgment, the petition shall be filed in the superior court of any county within California that would have been a proper venue if the underlying lawsuit had been filed in a California state court, or in the Superior Court of the County of Sacramento.

(b) A copy of the petition shall be served upon the Secretary of State by the claimant. A certificate or affidavit of service shall be filed by the claimant with the court. Service on the Secretary of State may be made by mail addressed to the Secretary of State’s office.

(c) The Secretary of State shall have 30 calendar days after being served with the petition in which to file a written response. The court shall thereafter set the matter for hearing upon the request of the claimant. The court shall grant a request of the Secretary of State for one continuance of as much as 30 calendar days and may, upon a showing of good cause by any party, continue the hearing as the court deems appropriate.

(d) The claimant shall have the burden of proving compliance with the requirements of Section 2282 by competent evidence at an evidentiary hearing. The claimant shall be entitled to a de novo review of the merits of the application as contained in the administrative record.

(e) At any time during the court proceedings, the petition may be compromised or settled by the Secretary of State and the court shall, upon joint petition of the claimant and the Secretary of State, issue an order directing payment out of the fund.

title: 1. CORPORATIONS


citation: CORP § 2288

text:
(a) Whenever the court proceeds upon a petition under Section 2287, it shall order payment out of the fund only upon a determination that the aggrieved party has a valid cause of action within the purview of Section 2282, and has complied with Section 2287.

(b) (1) The Secretary of State may defend any action on behalf of the fund and shall have recourse to all appropriate means of defense and review, including examination of witnesses and the right to relitigate any issues that are material and relevant in the proceeding against the fund. The claimant’s judgment shall create a rebuttable presumption of the fraud, misrepresentation, or deceit by the corporation, which presumption shall affect the burden of producing evidence.

(2) If the civil judgment, arbitration award, or criminal restitution order in the underlying action on which the final judgment in favor of the petitioner was by default, stipulation, consent, or pursuant to Section 594 of the Code of Civil Procedure, or if the action against the corporation or its agent was defended by a trustee in bankruptcy, the petitioner shall have the burden of proving that the cause of action against the corporation or its agent was for fraud, misrepresentation, or deceit.

(c) If the final judgment is a criminal restitution order against an agent, the petitioner shall have the burden of proving that the defendant named in the criminal restitution order qualifies as an agent as defined in this chapter. An active corporation, that has submitted a response to the application pursuant to Section 2282.2, may be permitted by the court to appear in the action regarding the sole issue of whether the defendant named in the criminal restitution order qualifies as its agent as defined in this chapter.

(d) The Secretary of State may move the court at any time to dismiss the petition when it appears there are no triable issues and the petition is without merit. The motion may be supported by affidavit of any person or persons having knowledge of the facts, and may be made on the basis that the petition, and the judgment referred to therein, does not form the basis for a meritorious recovery claim within the purview of Section 2282; provided, however, the Secretary of State shall give written notice at least 10 calendar days before hearing on the motion to the claimant.

history: (History: Amended by Stats. 2016, Ch. 390, Sec. 5. (AB 2759) Effective January 1, 2017.)

title: 1. CORPORATIONS


citation: CORP § 2289

text:
(a) Notwithstanding any other provision of this chapter and regardless of the number of persons aggrieved in an instance of corporate fraud, or misrepresentation or deceit resulting in a judgment meeting the requirements of Section 2282, or the number of judgments against a corporation or its agent, the liability of the fund shall not exceed fifty thousand dollars ($50,000) for any one claimant per single judgment finding fraud, misrepresentation, or deceit, made with the intent to defraud.

(b) When multiple corporations or their agents are involved in the same event or series of events that are the basis of the claimant’s final judgment and the conduct of two or more of the corporations or their agents results in a judgment meeting the requirements of Section 2282, the claimant may seek recovery from the fund based on the judgment against any one of the corporations or their agents, subject to the limitations of subdivision (a).

(c) When multiple claimants are involved in a corporate fraud, or in misrepresentation or deceit by a corporation or its agents, resulting in a judgment meeting the requirements of Section 2282, each claimant may seek recovery from the fund individually, subject to the limitations of subdivision (a).

(d) Claimants who are spouses, registered domestic partners, or persons other than natural persons, that have obtained an eligible final judgment shall be considered one claimant.

history: (History: Amended by Stats. 2016, Ch. 390, Sec. 6. (AB 2759) Effective January 1, 2017.)

title: 1. CORPORATIONS


citation: CORP § 2290

text: If, at any time, the money deposited in the fund is insufficient to satisfy any duly authorized award or offer of settlement, the Secretary of State shall, when sufficient money has been deposited in the fund, satisfy the unpaid awards or offer of settlement, in the order that the awards or offers of settlement were originally filed.

history: (History: Amended by Stats. 2016, Ch. 390, Sec. 7. (AB 2759) Effective January 1, 2017.)

title: 1. CORPORATIONS


citation: CORP § 2291

text: Any sums received by the Secretary of State pursuant to any provisions of this chapter shall be deposited in the State Treasury and credited to the fund.

title: 1. CORPORATIONS


citation: CORP § 2292

text: It shall be unlawful for any person or the agent of any person to file with the Secretary of State any notice, statement, or other document required under the provisions of this chapter that is false or untrue or contains any willful, material misstatement of fact. That conduct shall constitute a public offense punishable by imprisonment in a county jail for a period of not more than one year or a fine of not more than one thousand dollars ($1,000), or both.

title: 1. CORPORATIONS


citation: CORP § 2293

text: When the Secretary of State has paid from the fund any sum to the claimant, the Secretary of State shall be subrogated to all of the rights of the claimant and the claimant shall assign all of his or her right, title, and interest in the judgment to the Secretary of State and any amount and interest so recovered by the Secretary of State on the judgment shall be deposited in the fund.

title: 1. CORPORATIONS


text: If the Secretary of State pays from the fund any amount in settlement of a claim or toward satisfaction of a final judgment against a corporation or its agent, the corporation or its agent shall be required to pay to the fund the amount paid plus interest at the prevailing legal rate applicable to a judgment rendered in any court of this state, within 30 calendar days of the date that the Secretary of State provided notice of the payment of the award or compromise. If the corporation or its agent fails to make the required payment to the fund within the required time, the corporation shall be suspended until the payment is made. A discharge in bankruptcy shall not relieve a corporation or its agent from the penalties and disabilities provided in this chapter.

history: (History: Amended by Stats. 2016, Ch. 390, Sec. 8. (AB 2759) Effective January 1, 2017.)

title: 1. CORPORATIONS


citation: CORP § 2294

text: The Secretary of State shall not make any award to a claimant from the fund if the claimant has received payment from any other restitution funds or for the portions of the judgment that the claimant has collected from the corporation or its agent or any other defendant in the underlying judgment.

history: (History: Amended by Stats. 2016, Ch. 390, Sec. 9. (AB 2759) Effective January 1, 2017.)

title: 1. CORPORATIONS


citation: CORP § 2295

text: The failure of an aggrieved person to comply with all of the provisions of this chapter shall constitute a waiver of any rights hereunder.

title: 1. CORPORATIONS


citation: CORP § 2296

text: This chapter shall apply to applications submitted to the Secretary of State on or after January 1, 2013.

title: 1. CORPORATIONS


citation: CORP § 2300

text: As used in this chapter, the term “new law” means this division of the Corporations Code as amended by act of the California Legislature, 1975–76 Regular Session, effective January 1, 1977, and as in effect on that date; the term “prior law” means the applicable law as in effect prior to January 1, 1977; and the term “effective date” means January 1, 1977.

history: (History: Added by Stats. 1975, Ch. 682.)

title: 1. CORPORATIONS

chapter: 23. Transition Provisions

path: 1. CORPORATIONS > 1. GENERAL CORPORATION LAW > 23. Transition Provisions


citation: CORP § 2301

text:
(a) Except as otherwise expressly provided in this chapter, the provisions of the new law apply on and after the effective date to all corporations referred to in Section 162 existing on the effective date and to all actions taken by the directors or shareholders of such corporations on and after the effective date.

(b) Except as otherwise expressly provided in this chapter, all of the sections of the new law governing acts, contracts or other transactions by a corporation or its directors or shareholders apply only to such acts, contracts or transactions occurring on or after the effective date and the prior law governs such acts, contracts or transactions occurring prior thereto.

(c) Except as otherwise expressly provided in this chapter, any vote or consent by the directors or shareholders of a corporation prior to the effective date in accordance with the prior law shall be effective in accordance with the prior law and if any certificate or document is required to be filed in any public office of this state relating to such action, it may be filed after the effective date in accordance with the prior law.

title: 1. CORPORATIONS


citation: CORP § 2302

text: The provisions of Sections 202, 204 (other than subdivision (a) thereof) and 205 of the new law relating to the contents of articles do not apply to corporations existing on the effective date unless and until an amendment of the articles is filed stating that the corporation elects to be governed by all of the provisions of the new law not otherwise applicable to it under this chapter. Such amendment may be adopted by approval of the board alone, except that, if any such amendment makes any change in the articles other than conforming the statement of purposes and powers to subdivision (b) of Section 202 and the deletion of any references to par value and location of principal office and deleting any statement regarding the number of directors or conforming any such statement to Section 212 (subject to Section 2304), it shall also be approved by the outstanding shares (Section 152) if such approval is otherwise required for the changes made. The amendment shall not name the corporation’s initial agent for service of process if a report required by Section 1502 has been filed.

history: (History: Amended by Stats. 1977, Ch. 235.)

title: 1. CORPORATIONS


text: The provisions of subdivision (a) of Section 204, insofar as they require the inclusion of certain provisions in the articles, do not apply to the provisions of bylaws in effect on the effective date and valid under the prior law, unless and until an amendment is filed pursuant to Section 2302.

history: (History: Added by Stats. 1977, Ch. 235.)

title: 1. CORPORATIONS


text: The absence of any reference to par value in the articles of a corporation which is subject to the prior law relating to the contents of articles as specified in Section 2302 is equivalent to a statement that the shares of stock are to be without par value.

history: (History: Added by Stats. 1985, Ch. 764, Sec. 8.5.)

title: 1. CORPORATIONS


citation: CORP § 2303

text: Sections 206 and 207 of the new law apply to corporations existing on the effective date, but any statement in the articles of such corporation, prior to an amendment thereof pursuant to Section 2302, relating to the purposes or powers of the corporation shall not be construed as a limitation unless it is expressly stated as such.

title: 1. CORPORATIONS


citation: CORP § 2304

text: The effect of a difference between the articles and bylaws in the statement of the number of directors shall not be governed by subdivision (a) of Section 212 of the new law for a corporation existing on the effective date, which shall continue to be governed by the prior law, unless and until an amendment of its articles is filed pursuant to Section 2302. If such amendment makes any change in the number of directors or the maximum or minimum number of directors or makes a change from a fixed to a variable board or vice versa, it shall also be approved by the outstanding shares (Section 152).

history: (History: Amended by Stats. 1988, Ch. 919, Sec. 11.)

title: 1. CORPORATIONS


citation: CORP § 2305

text: Subdivision (a) of Section 312 of the new law applies to a corporation existing on the effective date, but the “treasurer” of such corporation shall be deemed to be the “chief financial officer.”

title: 1. CORPORATIONS


citation: CORP § 2306

text: Section 317 of the new law governs any proposed indemnification by a corporation after the effective date, whether the events upon which the indemnification is based occurred before or after the effective date. Any statement relating to indemnification contained in the articles or bylaws of a corporation on the effective date shall not be construed as limiting the indemnification permitted by Section 317 unless it is expressly stated as so intended.

title: 1. CORPORATIONS


citation: CORP § 2307

text: Sections 417 and 418 of the new law relating to required statements on certificates representing shares apply to certificates representing shares of corporations existing on the effective date only if the shares are originally issued after the effective date, and the prior law shall continue to govern the certificates representing shares originally issued prior to the effective date, unless and until an amendment of the articles is filed pursuant to Section 2302, and the certificate is presented for transfer.

title: 1. CORPORATIONS


citation: CORP § 2308

text: Chapter 5 of the new law applies to any distribution to its shareholders made after the effective date by a corporation existing on the effective date, except that any such distribution effected pursuant to a contract for the purchase or redemption of shares entered into by the corporation prior to the effective date may be made if permissible under Chapter 5 or under the prior law in effect at the time the contract was entered into.

title: 1. CORPORATIONS


citation: CORP § 2309

text: Subdivision (a) of Section 510 of the new law applies only to shares acquired after the effective date.

title: 1. CORPORATIONS


citation: CORP § 2310

text: The provisions of Chapter 6 (commencing with Section 600) and Chapter 7 (commencing with Section 700) (other than Section 706) of the new law apply to any meeting of shareholders held after the effective date and to any action by shareholders pursuant to written consent which becomes effective after the effective date and to any vote cast at such a meeting or consent given for such action (whether or not a proxy or consent was executed by the shareholder prior to the effective date); provided, however, that the prior law shall apply to any such meeting of shareholders and to any vote cast at such a meeting if such meeting was initially called for a date prior to the effective date and notice thereof was given to shareholders entitled to vote thereat.

title: 1. CORPORATIONS


citation: CORP § 2311

text: Section 706 of the new law applies to agreements and voting trusts entered into after the effective date and prior law governs such agreements or trusts entered into prior thereto unless the agreement or trust is amended or extended thereafter, in which event the new law applies.

title: 1. CORPORATIONS


citation: CORP § 2312

text: Section 800 of the new law applies to actions commenced after the effective date and prior law governs actions pending on the effective date.

title: 1. CORPORATIONS


citation: CORP § 2313

text: Chapters 10 (commencing with Section 1000), 11 (commencing with Section 1100), 12 (commencing with Section 1200) and 13 (commencing with Section 1300) of the new law apply to transactions consummated after the effective date, unless a required approval of the outstanding shares (Section 152) has been given prior to the effective date or has been given after the effective date but at a meeting of shareholders initially called for a date prior to the effective date, in which case the transaction shall be governed by the prior law.

title: 1. CORPORATIONS


citation: CORP § 2314

text: Chapters 18 (commencing with Section 1800) and 20 (commencing with Section 2000) of the new law apply to actions for involuntary dissolution commenced after the effective date, but the prior law governs any such action pending on the effective date.

title: 1. CORPORATIONS


citation: CORP § 2315

text: Chapters 19 (commencing with Section 1900) and 20 (commencing with Section 2000) of the new law apply to any voluntary dissolution proceeding initiated by the filing of an election after the effective date, but the prior law governs any such proceeding so initiated prior to the effective date.

title: 1. CORPORATIONS


citation: CORP § 2316

text: A foreign association which has transacted intrastate business in this state prior to the effective date and which is required by Section 2105 of the new law to obtain a certificate of qualification from the Secretary of State shall not be subject to any direct or indirect penalty as a result of failure to obtain such certificate of qualification if the certificate of qualification is obtained no later than four months after the effective date.

title: 1. CORPORATIONS


citation: CORP § 2317

text: When any corporate agent for service of process has been designated prior to the effective date and such designation of agent included a name of a city, town or village wherein the corporate agent maintained an office, service on such agent may be effected at any office of the agent set forth in the certificate of the corporate agent filed pursuant to Section 1505 of the new law or filed pursuant to Section 3301.5, 3301.6, 6403.5 or 6403.6 of the prior law, whether or not such office is in said city, town or village.

title: 1. CORPORATIONS


citation: CORP § 2318

text:
Any corporation existing on the first day of January, 1873, formed under the laws of this state, and still existing, which has not already elected to continue its existence under the prior law, may, at any time, elect to continue its existence under the provisions of this code applicable thereto by the unanimous vote of all its directors, or such election may be made at any annual meeting of the shareholders, or at any meeting called by the directors especially for considering the subject, if voted by shareholders representing a majority of the voting power, or may be made by the directors upon the written consent of that number of the shareholders.

A certificate of the action of the directors, signed by them and their secretary, when the election is made by their unanimous vote, or upon the written consent of the shareholders, or a certificate of the proceedings of the meeting of the shareholders, when the election is made at any such meeting, signed by the chairperson and secretary of the meeting and a majority of the directors, shall be filed in the office of the Secretary of State, and thereafter the corporation continues its existence under the provisions of this code which are applicable thereto, and possesses all the rights, and powers, and is subject to all the obligations, restrictions, and limitations prescribed thereby.

history: (History: Amended by Stats. 2022, Ch. 617, Sec. 39. (SB 1202) Effective January 1, 2023.)

title: 1. CORPORATIONS


citation: CORP § 2319

text: If the corporate rights, privileges and powers of a corporation have been suspended and are still suspended immediately prior to the effective date pursuant to Sections 5700 through 5908 of the old law and provisions of law there referred to, said sections and provisions continue to apply to such a corporation until restoration by the Controller pursuant to said sections.

title: 1. CORPORATIONS


citation: CORP § 2500

text: This division shall be known and may be cited as the Social Purpose Corporations Act.

history: (History: Amended by Stats. 2014, Ch. 694, Sec. 13. (SB 1301) Effective January 1, 2015.)

division: 1.5. SOCIAL PURPOSE CORPORATIONS ACT

title: 1. CORPORATIONS

chapter: 1. General Provisions and Definitions

path: 1. CORPORATIONS > 1.5. SOCIAL PURPOSE CORPORATIONS ACT > 1. General Provisions and Definitions


citation: CORP § 2501

text: Except as otherwise expressly stated, the provisions of Division 1 (commencing with Section 100) shall apply to corporations organized under this division, and references in that division to the terms “close corporation,” “constituent corporation,” “corporation,” “disappearing corporation,” “domestic corporation,” “foreign corporation,” “surviving corporation,” and similar terms shall be read to apply, in the same manner, to include the similar “social purpose corporation.”

history: (History: Amended by Stats. 2014, Ch. 694, Sec. 14. (SB 1301) Effective January 1, 2015.)

title: 1. CORPORATIONS


citation: CORP § 2502

text: This division applies only to social purpose corporations organized expressly under this division whether organized or existing under this division or amended, merged or converted into a social purpose corporation in accordance with Chapter 9 (commencing with Section 900) of Division 1, Chapter 11 (commencing with Section 1100) of Division 1 or Chapter 11.5 (commencing with Section 1150) of Division 1, including all flexible purpose corporations formed under this division prior to January 1, 2015, and now existing except as provided in paragraph (2) of subdivision (b) of Section 2601 and paragraph (3) of subdivision (b) of Section 2602.

history: (History: Amended by Stats. 2014, Ch. 694, Sec. 15. (SB 1301) Effective January 1, 2015.)

title: 1. CORPORATIONS


text: Every social purpose corporation organized under the laws of this state or similar foreign social purpose corporation, all of the capital stock of which is beneficially owned by the United States, an agency or instrumentality of the United States or any social purpose corporation or similar foreign social purpose corporation the whole of the capital stock of which is owned by the United States or by an agency or instrumentality of the United States, is conclusively presumed to be an agency and instrumentality of the United States and is entitled to all privileges and immunities to which the holders of all of its stock are entitled as agencies of the United States.

history: (History: Amended by Stats. 2014, Ch. 694, Sec. 16. (SB 1301) Effective January 1, 2015.)

title: 1. CORPORATIONS


text: Unless otherwise expressly provided, whenever reference is made in this division to any other state or federal statute, that reference is to that statute as it may be amended from time to time, whether before or after the enactment of this division.

history: (History: Added by Stats. 2011, Ch. 740, Sec. 12. (SB 201) Effective January 1, 2012.)

title: 1. CORPORATIONS


text: A social purpose corporation may be sued in the same manner as a corporation as provided in the Code of Civil Procedure.

history: (History: Amended by Stats. 2014, Ch. 694, Sec. 17. (SB 1301) Effective January 1, 2015.)

title: 1. CORPORATIONS