Corporations Code — Part 11 | CORP — United States — California law | Esheria

Corporations Code

Part 11 of 13 · provisions 2,001–2,200

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This section repeals the listed acts and sections, but it does not affect certain pre-1873 corporations that did not elect to continue under the Civil Code. This section repeals the acts and code sections listed in it. This section repeals the listed acts and code sections. This section repeals the listed acts and code sections. This section repeals Chapter 183 of the Statutes of 1941.

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Provisions of Corporations Code

Showing 200 of 2,411

  1. 6011.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 10. Mergers [6010 - 6022] ( Chapter 10 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Merger [6010 - 6019.1] ( Article 1 added by Stats. 1978, Ch. 567. )

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    Each corporation’s board must approve a merger agreement if the corporation wants to merge.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 10. Mergers [6010 - 6022] ( Chapter 10 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Merger [6010 - 6019.1] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 6011. The board of each corporation which desires to merge shall approve an agreement of merger. The constituent corporations shall be parties to the agreement of merger and other persons may be parties to the agreement of merger. The agreement shall state: (a) The terms and conditions of the merger; (b) The amendments, subject to Sections 5810 and 5816, to the articles of the surviving corporation to be effected by the merger, if any; if any amendment changes the name of the surviving corporation, the new name may be the same as or similar to the name of a disappearing corporation, subject to subdivision (b) of Section 5122; (c) The amendments to the bylaws of the surviving corporation to be effected by the merger, if any; (d) The name and place of incorporation of each constituent corporation and which of the constituent corporations is the surviving corporation; (e) The manner, if any, of converting memberships of the constituent corporations into memberships of the surviving corporation; and (f) Such other details or provisions as are desired, if any. (Amended by Stats. 1979, Ch. 724.)
  2. 6012.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 10. Mergers [6010 - 6022] ( Chapter 10 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Merger [6010 - 6019.1] ( Article 1 added by Stats. 1978, Ch. 567. )

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    The principal terms of a merger must be approved by the members of each constituent corporation and by any other persons whose approval is required by the articles.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 10. Mergers [6010 - 6022] ( Chapter 10 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Merger [6010 - 6019.1] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 6012. The principal terms of the merger shall be approved by the members (Section 5034) of each constituent corporation and by each other person or persons whose approval of an amendment of articles is required by the articles; and the approval by the members (Section 5034) or such other person or persons required by this section may be given before or after the approval by the board. (Amended by Stats. 1981, Ch. 587, Sec. 20.)
  3. 6013.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 10. Mergers [6010 - 6022] ( Chapter 10 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Merger [6010 - 6019.1] ( Article 1 added by Stats. 1978, Ch. 567. )

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    Each constituent corporation must sign the merger agreement through the listed officers.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 10. Mergers [6010 - 6022] ( Chapter 10 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Merger [6010 - 6019.1] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 6013. Each constituent corporation shall sign the agreement by the chairperson of its board, president or a vice president, and secretary or an assistant secretary acting on behalf of their respective corporations. (Amended by Stats. 2022, Ch. 617, Sec. 54. (SB 1202) Effective January 1, 2023.)
  4. 6014.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 10. Mergers [6010 - 6022] ( Chapter 10 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Merger [6010 - 6019.1] ( Article 1 added by Stats. 1978, Ch. 567. )

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    After required approvals, the surviving corporation must file the merger agreement with attached officers’ certificates; the Secretary of State may certify a separate copy.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 10. Mergers [6010 - 6022] ( Chapter 10 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Merger [6010 - 6019.1] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 6014. After approval of a merger by the board and any approval by the members (Section 5034) or other person or persons required by Section 6012, the surviving corporation shall file a copy of the agreement of merger with an officers’ certificate of each constituent corporation attached stating the total number of memberships of each class entitled to vote on the merger, identifying any other person or persons whose approval is required, and stating that the principal terms of the agreement in the form attached were duly approved by the required vote of the members and (if applicable) such other person or persons. The merger and any amendment of the articles of the surviving corporation contained in the merger agreement shall thereupon be effective (subject to subdivision (c) of Section 5008 and subject to the provisions of Section 6018) and the several parties thereto shall be one surviving corporation. The Secretary of State may certify a copy of the merger agreement separate from the officers’ certificates attached thereto. (Amended by Stats. 2006, Ch. 773, Sec. 15. Effective September 29, 2006.)
  5. 6015.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 10. Mergers [6010 - 6022] ( Chapter 10 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Merger [6010 - 6019.1] ( Article 1 added by Stats. 1978, Ch. 567. )

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    An amended merger agreement may be adopted and approved by the board, and by the members if the amendment changes principal terms.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 10. Mergers [6010 - 6022] ( Chapter 10 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Merger [6010 - 6019.1] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 6015. (a) Any amendment to the agreement may be adopted and the agreement so amended may be approved by the board and, if it changes any of the principal terms of the agreement, by the members (Section 5034) or other person or persons, as required by Section 6012, of any constituent corporation in the same manner as the original agreement. (b) If the agreement so amended is approved as provided in subdivision (a), the agreement so amended shall then constitute the agreement of merger. (Amended by Stats. 1981, Ch. 587, Sec. 21.)
  6. 6016.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 10. Mergers [6010 - 6022] ( Chapter 10 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Merger [6010 - 6019.1] ( Article 1 added by Stats. 1978, Ch. 567. )

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    The board may abandon a merger before it becomes effective.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 10. Mergers [6010 - 6022] ( Chapter 10 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Merger [6010 - 6019.1] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 6016. The board may, in its discretion, abandon a merger, subject to the contractual rights, if any, of third parties, including other constituent corporations, without further approval by the members (Section 5034) or other persons entitled to approve the merger at any time before the merger is effective. (Added by Stats. 1978, Ch. 567.)
  7. 6017.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 10. Mergers [6010 - 6022] ( Chapter 10 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Merger [6010 - 6019.1] ( Article 1 added by Stats. 1978, Ch. 567. )

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    A certified copy of a merger agreement, if certified on or after the effective date by the official who has custody of it, has the same evidentiary force as the original.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 10. Mergers [6010 - 6022] ( Chapter 10 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Merger [6010 - 6019.1] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 6017. A copy of an agreement of merger certified on or after the effective date by an official having custody thereof has the same force in evidence as the original and, except as against the state, is conclusive evidence of the performance of all conditions precedent to the merger, the existence on the effective date of the surviving corporation and the performance of the conditions necessary to the adoption of any amendment to the articles contained in the agreement of merger. (Added by Stats. 1978, Ch. 567.)
  8. 6018.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 10. Mergers [6010 - 6022] ( Chapter 10 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Merger [6010 - 6019.1] ( Article 1 added by Stats. 1978, Ch. 567. )

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    This section sets conditions for merging corporations with foreign corporations and explains when the merger becomes effective and what filings are required.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 10. Mergers [6010 - 6022] ( Chapter 10 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Merger [6010 - 6019.1] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 6018. (a) Subject to the provisions of Section 6010, the merger of any number of corporations with any number of foreign corporations may be effected if the foreign corporations are authorized by the laws under which they are formed to effect the merger. The surviving corporation may be any one of the constituent corporations and shall continue to exist under the laws of the state or place of its incorporation. (b) If the surviving corporation is a public benefit corporation or a religious corporation, the merger proceedings with respect to that corporation and any disappearing corporation shall conform to the provisions of this chapter governing the merger of corporations, but if the surviving corporation is a foreign corporation, then, subject to the requirements of subdivision (d) and Section 6012, the merger proceedings may be in accordance with the laws of the state or place of incorporation of the surviving corporation. (c) If the surviving corporation is a public benefit corporation or a religious corporation, the agreement and the officers’ certificate of each constituent corporation shall be filed as provided in Section 6014 and thereupon, subject to subdivision (c) of Section 5008, the merger shall be effective as to each corporation; and each foreign disappearing corporation that is qualified for the transaction of intrastate business shall by virtue of the filing automatically surrender its right to transact intrastate business. (d) If the surviving corporation is a foreign corporation, the merger shall become effective in accordance with the law of the jurisdiction in which it is organized, but shall be effective as to any disappearing corporation as of the time of effectiveness in the foreign jurisdiction upon the filing in this state as required by this subdivision. There shall be filed as to the domestic disappearing corporation or corporations the documents described in any one of the following paragraphs: (1) A copy of the agreement, certificate, or other document filed by the surviving foreign corporation in the state or place of its incorporation for the purpose of effecting the merger, which copy shall be certified by the public officer having official custody of the original. (2) An executed counterpart of the agreement, certificate, or other document filed by the surviving corporation in the state or place of its incorporation for the purpose of effecting the merger. (3) A copy of the agreement of merger with an officers’ certificate of the surviving foreign corporation and of each constituent domestic corporation attached, which officers’ certificates shall conform to the requirements of Section 6014. (e) If the date of the filing in this state pursuant to subdivision (d) is more than six months after the time of the effectiveness in the foreign jurisdiction, or if the powers of the domestic corporation are suspended at the time of effectiveness in the foreign jurisdiction, the merger shall be effective as to the domestic disappearing corporation or corporations as of the date of filing in this state. Each foreign disappearing corporation that is qualified for the transaction of intrastate business shall automatically by the filing pursuant to subdivision (d) surrender its right to transact intrastate business as of the date of filing in this state regardless of the time of effectiveness as to a domestic disappearing corporation. (Amended by Stats. 2006, Ch. 773, Sec. 16. Effective September 29, 2006.)
  9. 6019.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 10. Mergers [6010 - 6022] ( Chapter 10 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Merger [6010 - 6019.1] ( Article 1 added by Stats. 1978, Ch. 567. )

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    If a merger agreement is made between a nonprofit corporation and a business corporation, listed code sections apply to the relevant constituent corporations.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 10. Mergers [6010 - 6022] ( Chapter 10 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Merger [6010 - 6019.1] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 6019. If an agreement of merger is entered into between a nonprofit corporation and a business corporation: (i) Sections 6011, 6012, 6014, and 6015 shall apply to any constituent public benefit corporation; (ii) Sections 8011, 8011.5, 8012, 8014, and 8015 shall apply to any constituent mutual benefit corporation; (iii) Sections 6014 and 6015 and subdivisions (c) and (d) of Section 9640 shall apply to any constituent religious corporation; and (iv) Sections 1101, 1101.1, 1103, and 1104 shall apply to any constituent business corporation. (Added by Stats. 1981, Ch. 587, Sec. 22.)
  10. 6019.1.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 10. Mergers [6010 - 6022] ( Chapter 10 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Merger [6010 - 6019.1] ( Article 1 added by Stats. 1978, Ch. 567. )

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    This section allows certain corporations to merge with other business entities, but only if required approvals are obtained and the merger paperwork is filed.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 10. Mergers [6010 - 6022] ( Chapter 10 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Merger [6010 - 6019.1] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 6019.1. (a) Subject to the provisions of Sections 6010 and 9640, any one or more corporations may merge with one or more other business entities (Section 5063.5). One or more other domestic corporations and foreign corporations (Section 5053) may be parties to the merger. Notwithstanding the provisions of this section, such a merger may be effected only if: (1) In a merger in which a domestic corporation or domestic other business entity is a party, it is authorized by the laws under which it is organized to effect the merger. (2) In a merger in which a foreign corporation is a party, it is authorized by the laws under which it is organized to effect the merger. (3) In a merger in which a foreign other business entity is a party, it is authorized by the laws under which it is organized to effect the merger. (b) Each corporation and each other party which desires to merge shall approve an agreement of merger. The board and the members (Section 5034) of each corporation which desires to merge, and each other person or persons, if any, whose approval of an amendment of the articles of that corporation is required by the articles or bylaws shall approve the agreement of merger. The agreement of merger shall be approved on behalf of each other party by those persons authorized or required to approve the merger by the laws under which it is organized. The parties desiring to merge shall be parties to the agreement of merger and other persons, including a parent party (Section 5064.5), may be parties to the agreement of merger. The agreement of merger shall state all of the following: (1) The terms and conditions of the merger. (2) The name and place of incorporation or organization of each party and the identity of the surviving party. (3) The amendments, if any, subject to Sections 5810 and 5816, to the articles of the surviving corporation, if applicable, to be effected by the merger. The name of the surviving corporation may be, subject to subdivision (b) of Section 5122 and subdivision (b) of Section 9122, the same as, or similar to, the name of a disappearing party to the merger. (4) The manner, if any, of converting the memberships of each of the constituent corporations into shares, memberships, interests, or other securities of the surviving party; and, if any memberships of any of the constituent corporations are not to be converted solely into shares, memberships, interests, or other securities of the surviving party, the cash, rights, securities, or other property which the holders of those memberships are to receive in exchange for the memberships, which cash, rights, securities, or other property may be in addition to, or in lieu of, shares, memberships, interests, or other securities of the surviving corporation or surviving other business entity. (5) Any other details or provisions required by the laws under which any party to the merger is organized, including, if an unincorporated association is a party to the merger, Section 18370, or if a domestic limited partnership is a party to the merger, subdivision (a) of Section 15911.12, if a domestic general partnership is a party to the merger, subdivision (a) of Section 16911, or, if a domestic limited liability company is a party to the merger, subdivision (a) of Section 17710.12. (6) Any other details or provisions as are desired. (c) Notwithstanding its prior approval, an agreement of merger may be amended prior to the filing of the agreement of merger if the amendment is approved by each constituent corporation in the same manner as the original agreement of merger. If the agreement of merger as so amended and approved is also approved by each of the other parties to the agreement of merger, as so amended it shall then constitute the agreement of merger. (d) The board of a constituent corporation may, in its discretion, abandon a merger, subject to the contractual rights, if any, of third parties, including other parties to the agreement of merger, without further approval by the members (Section 5034) or other persons, at any time before the merger is effective. (e) Each constituent corporation shall sign the agreement of merger by its chairperson of the board, president or a vice president, and also by its secretary or an assistant secretary acting on behalf of their respective corporations. (f) After required approvals of the merger by each constituent corporation and each other party to the merger, the surviving party shall file a copy of the agreement of merger with an officers’ certificate of each constituent domestic and foreign corporation attached stating the total number of outstanding shares or membership interests of each class, if any, entitled to vote on the merger (and identifying any other person or persons whose approval is required), that the agreement of merger in the form attached or its principal terms, as required, were approved by that corporation by a vote of a number of shares or membership interests of each class entitled to vote, if any, which equaled or exceeded the vote required, specifying each class entitled to vote and the percentage vote required of each class, and, if applicable, by that other person or persons whose approval is required. If equity securities of a parent party (Section 5064.5) are to be issued in the merger, the officers’ certificate or certificate of merger of the controlled party shall state either that no vote of the shareholders of the parent party was required or that the required vote was obtained. The merger and any amendment of the articles of the surviving corporation, if applicable, contained in the agreement of merger shall be effective upon the filing of the agreement of merger, subject to the provisions of subdivision (h). If a domestic reciprocal insurer organized after 1974 to provide medical malpractice insurance is a party to the merger, the agreement of merger or certificate of merger shall not be filed until there has been filed the certificate issued by the Insurance Commissioner approving the merger pursuant to Section 1555 of the Insurance Code. In lieu of an officers’ certificate, a certificate of merger, on a form prescribed by the Secretary of State, shall be filed for each constituent other business entity. The certificate of merger shall be executed and acknowledged by each domestic constituent limited liability company by all of the managers of the limited liability company (unless a lesser number is specified in its articles of organization or operating agreement) and by each domestic constituent limited partnership by all general partners (unless a lesser number is provided in its certificate of limited partnership or partnership agreement) and by each domestic constituent general partnership by two partners (unless a lesser number is provided in its partnership agreement) and by each foreign constituent limited liability company by one or more managers and by each foreign constituent general partnership or foreign constituent limited partnership by one or more general partners, and by each constituent reciprocal insurer by the chairperson of the board, president, or vice president, and also by the secretary or assistant secretary, or, if a constituent reciprocal insurer has not appointed such officers, by the chairperson of the board, president, or vice president, and also by the secretary or assistant secretary of the constituent reciprocal insurer’s attorney-in-fact, and by each other party to the merger by those persons required or authorized to execute the certificate of merger by the laws under which that party is organized, specifying for such party the provision of law or other basis for the authority of the signing persons. The certificate of merger shall set forth, if a vote of the shareholders, members, partners, or other holders of interests of a constituent other business entity was required, a statement setting forth the total number of outstanding interests of each class entitled to vote on the merger and that the agreement of merger or its principal terms, as required, were approved by a vote of the number of interests of each class which equaled or exceeded the vote required, specifying each class entitled to vote and the percentage vote required of each class, and any other information required to be set forth under the laws under which the constituent other business entity is organized, including, if a domestic limited partnership is a party to the merger, subdivision (a) of Section 15911.14, if a domestic general partnership is a party to the merger, subdivision (b) of Section 16915, and, if a domestic limited liability company is a party to the merger, subdivision (a) of Section 17710.14. The certificate of merger for each constituent foreign other business entity, if any, shall also set forth the statutory or other basis under which that foreign other business entity is authorized by the laws under which it is organized to effect the merger. The Secretary of State may certify a copy of the agreement of merger separate from the officers’ certificates and certificates of merger attached thereto. (g) A copy of an agreement of merger certified on or after the effective date by an official having custody thereof has the same force in evidence as the original and, except as against the state, is conclusive evidence of the performance of all conditions precedent to the merger, the existence on the effective date of the surviving party to the merger, the performance of the conditions necessary to the adoption of any amendment to the articles, if applicable, contained in the agreement of merger, and the merger of the constituent corporations, either by themselves or together with other constituent parties, into the surviving party to the merger. (h) (1) The merger of domestic corporations with foreign corporations or foreign other business entities in a merger in which one or more other business entities is a party shall comply with subdivisions (a) and (f) and this subdivision. (2) Subject to subdivision (c) of Section 5008 and paragraph (3), the merger shall be effective as to each domestic constituent corporation and domestic constituent other business entity upon filing of the agreement of merger with attachments as provided in subdivision (f). (3) If the surviving party is a foreign corporation or foreign other business entity, except as provided in paragraph (4), the merger shall be effective as to any domestic disappearing corporation as of the time of effectiveness in the foreign jurisdiction upon the filing in this state of a copy of the agreement of merger with an officers’ certificate of the surviving foreign corporation and of each constituent foreign and domestic corporation and a certificate of merger of each constituent other business entity attached, which officers’ certificates and certificates of merger shall conform to the requirements of subdivision (f). If one or more domestic other business entities is a disappearing party in a merger pursuant to this subdivision in which a foreign other business entity is the surviving entity, a certificate of merger required by the laws under which each domestic other business entity is organized, including subdivision (a) of Section 15911.14, subdivision (b) of Section 16915, or subdivision (a) of Section 17710.14, if applicable, shall also be filed at the same time as the filing of the agreement of merger. (4) If the date of the filing in this state pursuant to this subdivision is more than six months after the time of the effectiveness in the foreign jurisdiction, or if the powers of a domestic disappearing corporation are suspended at the time of effectiveness in the foreign jurisdiction, the merger shall be effective as to the domestic disappearing corporation as of the date of filing in this state. (5) Each foreign disappearing corporation that is qualified for the transaction of intrastate business shall automatically by the filing pursuant to subdivision (f) surrender its right to transact intrastate business as of the date of filing in this state or, if later, the effective date of the merger. With respect to each foreign disappearing other business entity previously registered for the transaction of intrastate business in this state, the filing of the agreement of merger pursuant to subdivision (f) automatically has the effect of a cancellation of registration for that foreign other business entity as of the date of filing in this state or, if later, the effective date of the merger, without the necessity of the filing of a certificate of cancellation. (Amended by Stats. 2012, Ch. 419, Sec. 11. (SB 323) Effective January 1, 2013. Operative January 1, 2014, by Sec. 32 of Ch. 419.)
  11. 602.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 6. Shareholders’ Meetings and Consents [600 - 605] ( Chapter 6 added by Stats. 1975, Ch. 682. )

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    Section 602 sets quorum and voting rules for shareholders’ meetings.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 6. Shareholders’ Meetings and Consents [600 - 605] ( Chapter 6 added by Stats. 1975, Ch. 682. ) ## 602. (a) Unless otherwise provided in the articles, a majority of the shares entitled to vote, represented in person or by proxy, shall constitute a quorum at a meeting of the shareholders, but in no event shall a quorum consist of less than one-third (or, in the case of a mutual water company, 20 percent) of the shares entitled to vote at the meeting or, except in the case of a close corporation, of more than a majority of the shares entitled to vote at the meeting. Except as provided in subdivision (b), the affirmative vote of a majority of the shares represented and voting at a duly held meeting at which a quorum is present (which shares voting affirmatively also constitute at least a majority of the required quorum) shall be the act of the shareholders, unless the vote of a greater number or voting by classes is required by this division or the articles. (b) The shareholders present at a duly called or held meeting at which a quorum is present may continue to transact business until adjournment notwithstanding the withdrawal of enough shareholders to leave less than a quorum, if any action taken (other than adjournment) is approved by at least a majority of the shares required to constitute a quorum or, if required by this division or the articles, the vote of a greater number or voting by classes. (c) In the absence of a quorum, any meeting of shareholders may be adjourned from time to time by the vote of a majority of the shares represented either in person or by proxy, but no other business may be transacted, except as provided in subdivision (b). (Amended by Stats. 2000, Ch. 485, Sec. 8. Effective January 1, 2001.)
  12. 6020.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 10. Mergers [6010 - 6022] ( Chapter 10 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Effect of Merger [6020 - 6022] ( Article 2 added by Stats. 1978, Ch. 567. )

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    When a merger happens under this chapter, the disappearing parties cease to exist and the surviving party takes their rights and property and becomes responsible for their debts and liabilities.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 10. Mergers [6010 - 6022] ( Chapter 10 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Effect of Merger [6020 - 6022] ( Article 2 added by Stats. 1978, Ch. 567. ) ## 6020. (a) Upon merger pursuant to this chapter the separate existences of the disappearing parties to the merger cease and the surviving party to the merger shall succeed, without other transfer, to all the rights and property of each of the disappearing parties to the merger and shall be subject to all the debts and liabilities of each and trust obligations upon the property of a disappearing party in the same manner as if incurred by the surviving party to the merger. (b) All rights of creditors and all liens and trusts upon or arising from the property of each of the constituent corporations and other parties to the merger shall be preserved unimpaired, provided that the liens and trust obligations upon property of a disappearing party shall be limited to the property affected thereby immediately prior to the time the merger is effective. (c) Any action or proceeding pending by or against any disappearing corporation or other party to the merger may be prosecuted to judgment, which shall bind the surviving party to the merger, or the surviving party to the merger may be proceeded against or substituted in its place. (Amended by Stats. 1999, Ch. 437, Sec. 15. Effective January 1, 2000.)
  13. 6020.5.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 10. Mergers [6010 - 6022] ( Chapter 10 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Effect of Merger [6020 - 6022] ( Article 2 added by Stats. 1978, Ch. 567. )

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    After a merger, the surviving entity must take on the disappearing entity’s specified tax liabilities and tax filing duties, and may have to pay any tax due. In some cases, the Secretary of State must notify the Franchise Tax Board.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 10. Mergers [6010 - 6022] ( Chapter 10 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Effect of Merger [6020 - 6022] ( Article 2 added by Stats. 1978, Ch. 567. ) ## 6020.5. (a) Upon merger pursuant to this chapter, a surviving domestic or foreign corporation or other business entity shall be deemed to have assumed the liability of each disappearing domestic or foreign corporation or other business entity that is taxed under Part 10 (commencing with Section 17001) of, or under Part 11 (commencing with Section 23001) of, Division 2 of the Revenue and Taxation Code for the following: (1) To prepare and file, or to cause to be prepared and filed, tax and information returns otherwise required of that disappearing entity as specified in Chapter 2 (commencing with Section 18501) of Part 10.2 of Division 2 of the Revenue and Taxation Code. (2) To pay any tax liability determined to be due. (b) If the surviving entity is a domestic limited liability company, domestic corporation, or registered limited liability partnership or a foreign limited liability company, foreign limited liability partnership, or foreign corporation that is registered or qualified to do business in California, the Secretary of State shall notify the Franchise Tax Board of the merger. (Amended by Stats. 2006, Ch. 773, Sec. 18. Effective September 29, 2006.)
  14. 6021.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 10. Mergers [6010 - 6022] ( Chapter 10 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Effect of Merger [6020 - 6022] ( Article 2 added by Stats. 1978, Ch. 567. )

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    If a qualifying merger involves real property in California, filing the required merger certificate or certified merger document in the county recorder’s office is evidence that the surviving party owns the disappearing party’s interest in that property.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 10. Mergers [6010 - 6022] ( Chapter 10 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Effect of Merger [6020 - 6022] ( Article 2 added by Stats. 1978, Ch. 567. ) ## 6021. Whenever a domestic or foreign corporation or other business entity (Section 5063.5) having any real property in this state merges with another domestic or foreign corporation or other business entity pursuant to the laws of this state or of the state or place in which any constituent party to the merger was organized, and the laws of the state or place of organization (including this state) of any disappearing party to the merger provide substantially that the making and filing of the agreement of merger vests in the surviving party to the merger all the real property of any disappearing party to the merger, the filing for record in the office of the county recorder of any county in this state in which any of the real property of the disappearing party to the merger is located of either (a) a certificate prescribed by the Secretary of State, or (b) a copy of the agreement of merger or certificate of merger, certified by the Secretary of State or an authorized public official of the state or place pursuant to the laws of which the merger is effected, shall evidence record ownership in the surviving party to the merger of all interest of that disappearing party to the merger in and to the real property located in that county. (Amended by Stats. 1999, Ch. 437, Sec. 16. Effective January 1, 2000.)
  15. 6022.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 10. Mergers [6010 - 6022] ( Chapter 10 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Effect of Merger [6020 - 6022] ( Article 2 added by Stats. 1978, Ch. 567. )

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    Certain bequests and other donations to a constituent corporation pass to the surviving party after a merger.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 10. Mergers [6010 - 6022] ( Chapter 10 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Effect of Merger [6020 - 6022] ( Article 2 added by Stats. 1978, Ch. 567. ) ## 6022. Any bequest, devise, gift, grant, or promise contained in a will or other instrument of donation, subscription, or conveyance, which is made to a constituent corporation and which takes effect or remains payable after the merger, inures to the surviving party to the merger. (Amended by Stats. 1999, Ch. 437, Sec. 17. Effective January 1, 2000.)
  16. 603.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 6. Shareholders’ Meetings and Consents [600 - 605] ( Chapter 6 added by Stats. 1975, Ch. 682. )

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    Shareholders can approve certain actions without a meeting by written consent, but the corporation must give notice in some cases and director elections by written consent are mostly barred.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 6. Shareholders’ Meetings and Consents [600 - 605] ( Chapter 6 added by Stats. 1975, Ch. 682. ) ## 603. (a) Unless otherwise provided in the articles, any action that may be taken at any annual or special meeting of shareholders may be taken without a meeting and without prior notice, if a consent in writing, as specified in Section 195, setting forth the action so taken, shall be provided by the holders of outstanding shares having not less than the minimum number of votes that would be necessary to authorize or take that action at a meeting at which all shares entitled to vote thereon were present and voted. (b) Unless the consents of all shareholders entitled to vote have been solicited in writing, both of the following shall apply: (1) Notice of any shareholder approval pursuant to Section 310, 317, 1152, 1201 (except for a reorganization as to which shareholders have the right, pursuant to Chapter 13 (commencing with Section 1300) to demand payment of cash for their shares), or 2007 without a meeting by less than unanimous written consent shall be given at least 10 days before the consummation of the action authorized by that approval. Notice shall be given as provided in subdivision (b) of Section 601. (2) Prompt notice shall be given of the taking of any other corporate action approved by shareholders without a meeting by less than unanimous written consent, to those shareholders entitled to vote who have not consented in writing. Notice shall be given as provided in subdivision (b) of Section 601. (c) Any shareholder giving a written consent, or the shareholder’s proxyholders, or a transferee of the shares or a personal representative of the shareholder or their respective proxyholders, may revoke the consent personally or by proxy by a writing received by the corporation prior to the time that written consents of the number of shares required to authorize the proposed action have been filed with the secretary of the corporation, but may not do so thereafter. The revocation is effective upon its receipt by the secretary of the corporation. (d) Notwithstanding subdivision (a), directors may not be elected by written consent except by unanimous written consent of all shares entitled to vote for the election of directors; provided that the shareholders may elect a director to fill a vacancy, other than a vacancy created by removal, by the written consent of a majority of the outstanding shares entitled to vote. (Amended by Stats. 2013, Ch. 109, Sec. 1. (AB 457) Effective January 1, 2014.)
  17. 604.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 6. Shareholders’ Meetings and Consents [600 - 605] ( Chapter 6 added by Stats. 1975, Ch. 682. )

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    Certain proxy or written consent materials must give shareholders a choice to approve or disapprove matters, and in director elections a proxy marked “withhold” must not be voted for a director.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 6. Shareholders’ Meetings and Consents [600 - 605] ( Chapter 6 added by Stats. 1975, Ch. 682. ) ## 604. (a) Any form of proxy or written consent distributed to 10 or more shareholders of a corporation with outstanding shares held of record by 100 or more persons shall afford an opportunity on the proxy or form of written consent to specify a choice between approval and disapproval of each matter or group of related matters intended to be acted upon at the meeting for which the proxy is solicited or by such written consent, other than elections to office, and shall provide, subject to reasonable specified conditions, that where the person solicited specifies a choice with respect to any such matter the shares will be voted in accordance therewith. (b) In any election of directors, any form of proxy in which the directors to be voted upon are named therein as candidates and which is marked by a shareholder “withhold” or otherwise marked in a manner indicating that the authority to vote for the election of directors is withheld shall not be voted for the election of a director. (c) Failure to comply with this section shall not invalidate any corporate action taken, but may be the basis for challenging any proxy at a meeting and the superior court may compel compliance therewith at the suit of any shareholder. (d) This section does not apply to any corporation with an outstanding class of securities registered under Section 12 of the Securities Exchange Act of 1934 or whose securities are exempted from such registration by Section 12(g)(2) of that act. (Amended by Stats. 1980, Ch. 501.)
  18. 605.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 6. Shareholders’ Meetings and Consents [600 - 605] ( Chapter 6 added by Stats. 1975, Ch. 682. )

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    This section tells how to count record holders of a corporation’s shares for the 100-person threshold and how certain shared or indirect holdings are treated.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 6. Shareholders’ Meetings and Consents [600 - 605] ( Chapter 6 added by Stats. 1975, Ch. 682. ) ## 605. (a) For the purpose of determining whether a corporation has outstanding shares held of record by 100 or more persons, shares shall be deemed to be “held of record” by each person who is identified as the owner of such shares on the record of shareholders maintained by or on behalf of the corporation, subject to the following: (1) In any case where the record of shareholders has not been maintained in accordance with accepted practice, any additional person who would be identified as such an owner on such record if it had been maintained in accordance with accepted practice shall be included as a holder of record. (2) Shares identified as held of record by a corporation, a partnership, a limited liability company, a trust, whether or not the trustees are named, or other organization shall be included as so held by one person. (3) Shares identified as held of record by one or more persons as trustees, executors, guardians, conservators, custodians or in other fiduciary capacities with respect to a single trust, estate or account shall be included as held of record by one person. (4) Shares held by two or more persons as coowners shall be included as held by one person. (5) Shares registered in substantially similar names, where the corporation (or other person soliciting proxies) has reason to believe because of the address or other indications that such names represent the same person, may be included as held of record by one person. (b) Notwithstanding subdivision (a): (1) Shares held, to the knowledge of the corporation (or other person soliciting proxies), subject to a voting trust, deposit agreement or similar arrangement shall be included as held of record by the recordholders of the voting trust certificates, certificates of deposit, receipts or similar evidences of interest in such securities; provided, however, that the corporation (or other person soliciting proxies) may rely in good faith on such information as is received in response to its request from a nonaffiliated issuer of the certificates or evidences of interest. (2) If the corporation (or other person soliciting proxies) knows or has reason to know that the form of holding shares of record is used primarily to circumvent the provisions of this section, the beneficial owners of such shares shall be deemed to be the record owners thereof. (Amended by Stats. 1994, Ch. 1010, Sec. 65. Effective January 1, 1995.)
  19. 6110.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 11. Bankruptcy Reorganizations and Arrangements [6110- 6110.] ( Chapter 11 added by Stats. 1978, Ch. 567. )

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    Corporate reorganization proceedings are governed by Chapter 14, and Chapter 14 references to shareholders are treated as references to members.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 11. Bankruptcy Reorganizations and Arrangements [6110- 6110.] ( Chapter 11 added by Stats. 1978, Ch. 567. ) ## 6110. Any proceeding, initiated with respect to a corporation, under any applicable statute of the United States, as now existing or hereafter enacted, relating to reorganizations of corporations, shall be governed by the provisions of Chapter 14 (commencing with Section 1400) of Division 1 of Title 1, and for this purpose the reference in Chapter 14 to “shareholders” shall be deemed to be a reference to members and the reference to “this division” shall be deemed to be a reference to this part. (Amended by Stats. 2009, Ch. 500, Sec. 19. (AB 1059) Effective January 1, 2010.)
  20. 6210.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 12. Required Filings by Corporation or Its Agent [6210 - 6216] ( Chapter 12 added by Stats. 1978, Ch. 567. )

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    Corporations must file a prescribed statement with the Secretary of State within 90 days after filing their original articles and every two years after that.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 12. Required Filings by Corporation or Its Agent [6210 - 6216] ( Chapter 12 added by Stats. 1978, Ch. 567. ) ## 6210. (a) Every corporation shall, within 90 days after the filing of its original articles and biennially thereafter during the applicable filing period, file, on a form prescribed by the Secretary of State, a statement containing: (1) the name of the corporation and the 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 office in California, if any; (4) the mailing address of the corporation, if different from the street address of its principal office or if the corporation has no principal office address in California; and (5) 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, a valid electronic mail address for the corporation or for the corporation’s designee to receive those notices. (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 any domestic or foreign or foreign business corporation that has complied with Section 1505 and whose capacity to act as an 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) For the purposes of this section, the applicable filing period for a corporation shall be the calendar month during which its original articles were filed and the immediately preceding five calendar months. The Secretary of State shall provide a notice to each corporation to comply with this section approximately three months before the close of the applicable filing period. The notice shall state the due date for compliance and shall be sent to the last address of the corporation according to the records of the Secretary of State or to the last electronic mail address according to the records of the Secretary of State if the corporation has elected to receive notices from the Secretary of State by electronic mail. Neither the failure of the Secretary of State to send the notice nor the failure of the corporation to receive it is an excuse for failure to comply with this section. (d) 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 must 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 articles as to the agent for service of process and the address of the agent. (e) The Secretary of State may destroy or otherwise dispose of any statement filed pursuant to this section after it has been superseded by the filing of a new statement. (f) This section does not place any person dealing with the corporation on notice of, or under any duty to inquire about, the existence or content of a statement filed pursuant to this section. (Amended by Stats. 2022, Ch. 617, Sec. 55. (SB 1202) Effective January 1, 2023.)
  21. 6211.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 12. Required Filings by Corporation or Its Agent [6210 - 6216] ( Chapter 12 added by Stats. 1978, Ch. 567. )

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    An agent for service of process may file a resignation with the Secretary of State, and the Secretary of State must notify the corporation. The section also allows certain disclaimers and lets the Secretary of State dispose of the resignation after replacement paperwork is filed.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 12. Required Filings by Corporation or Its Agent [6210 - 6216] ( Chapter 12 added by Stats. 1978, Ch. 567. ) ## 6211. (a) An agent designated for service of process pursuant to Section 6210 may deliver to the Secretary of State, on a form prescribed by the Secretary of State for filing, a signed and acknowledged written statement of resignation as an agent for service of process containing the name of the corporation, the Secretary of State’s file number of the corporation, the name of the resigning agent for service of process, and a statement that the agent is resigning. Thereupon the authority of the agent to act in that capacity shall cease and the Secretary of State forthwith shall mail or otherwise provide written notice of the filing of the statement of resignation to the corporation at its principal office. (b) The resignation of an agent may be effective if, on a form prescribed by the Secretary of State containing the name of the corporation, the Secretary of State’s file number for the corporation, and the name of the agent for service of process, the agent disclaims having been properly appointed as the agent. Similarly, a person named as an officer or director may indicate that the person was never properly appointed as the officer or director. (c) The Secretary of State may destroy or otherwise dispose of any resignation filed pursuant to this section after a new form is filed pursuant to Section 6210 replacing the agent for service of process that has resigned. (Amended by Stats. 2014, Ch. 834, Sec. 12. (SB 1041) Effective January 1, 2015.)
  22. 6212.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 12. Required Filings by Corporation or Its Agent [6210 - 6216] ( Chapter 12 added by Stats. 1978, Ch. 567. )

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    If the designated agent for service of process changes status in the listed ways, the corporation must promptly file a new agent designation that meets Section 6210.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 12. Required Filings by Corporation or Its Agent [6210 - 6216] ( Chapter 12 added by Stats. 1978, Ch. 567. ) ## 6212. If a natural person who has been designated agent for service of process pursuant to Section 6210 dies or resigns or no longer resides in the state or if the corporate agent for such purpose resigns, dissolves, withdraws from the state, forfeits its right to transact intrastate business, has its corporate rights, powers and privileges suspended or ceases to exist, the corporation shall forthwith file a designation of a new agent conforming to the requirements of Section 6210. (Added by Stats. 1978, Ch. 567.)
  23. 6214.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 12. Required Filings by Corporation or Its Agent [6210 - 6216] ( Chapter 12 added by Stats. 1978, Ch. 567. )

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    If an assessor asks, a corporation with locally assessed property must provide a true copy of relevant business records at its California principal office or another mutually acceptable place.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 12. Required Filings by Corporation or Its Agent [6210 - 6216] ( Chapter 12 added by Stats. 1978, Ch. 567. ) ## 6214. Upon request of an assessor, a corporation owning, claiming, possessing or controlling property in this state subject to local assessment shall make available at the corporation’s principal office in California or at a place mutually acceptable to the assessor and the corporation a true copy of business records relevant to the amount, cost and value of all property that it owns, claims, possesses or controls within the county. (Amended by Stats. 1979, Ch. 724.)
  24. 6215.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 12. Required Filings by Corporation or Its Agent [6210 - 6216] ( Chapter 12 added by Stats. 1978, Ch. 567. )

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    Corporate officers, directors, employees, and agents can be jointly and severally liable for damages if they make or publish false corporate records or knowingly false entries, or alter records with intent to deceive.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 12. Required Filings by Corporation or Its Agent [6210 - 6216] ( Chapter 12 added by Stats. 1978, Ch. 567. ) ## 6215. Any officers, directors, employees or agents of a corporation who do any of the following are liable jointly and severally for all the damages resulting therefrom to the corporation or any person injured thereby who relied thereupon or to both: (a) Make, issue, deliver or publish any report, circular, certificate, financial statement, balance sheet, public notice or document respecting the corporation or its memberships, assets, liabilities, business, earnings or accounts which is false in any material respect, knowing it to be false, or participate in the making, issuance, delivery or publication thereof with knowledge that the same is false in a material respect. (b) Make or cause to be made in the books, minutes, records or accounts of a corporation any entry which is false in any material particular knowing such entry is false. (c) Remove, erase, alter or cancel any entry in any books or records of the corporation, with intent to deceive. (Added by Stats. 1978, Ch. 567.)
  25. 6216.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 12. Required Filings by Corporation or Its Agent [6210 - 6216] ( Chapter 12 added by Stats. 1978, Ch. 567. )

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    The Attorney General may act on complaints about a nonprofit corporation’s noncompliance, give notice, and then bring proceedings if the answer is unsatisfactory or missing within 30 days.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 12. Required Filings by Corporation or Its Agent [6210 - 6216] ( Chapter 12 added by Stats. 1978, Ch. 567. ) ## 6216. (a) The Attorney General, upon complaint of a member, director or officer, that a corporation is failing to comply with the provisions of this chapter, Chapter 5 (commencing with Section 5510), Chapter 6 (commencing with Section 5610) or Chapter 13 (commencing with Section 6310), may, in the name of the people of the State of California, send to the principal office of such corporation, (or, if there is no such office, to the office or residence of the chief executive officer or secretary, of the corporation, as set forth in the most recent statement filed pursuant to Section 6210) notice of the complaint. If the answer is not satisfactory, or if there is no answer within 30 days, the Attorney General may institute, maintain or intervene in such suits, actions, or proceedings of any type in any court or tribunal of competent jurisdiction or before any administrative agency for such relief by way of injunction, the dissolution of entities, the appointment of receivers or any other temporary, preliminary, provisional or final remedies as may be appropriate to protect the rights of members or to undo the consequences of failure to comply with such requirements. In any such action, suit or proceeding there may be joined as parties all persons and entities responsible for or affected by such activity. (b) The Attorney General may bring an action under subdivision (a) without having received a complaint, and without first giving notice of a complaint. (Added by Stats. 1978, Ch. 567.)
  26. 6310.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [6310 - 6313] ( Article 1 added by Stats. 1978, Ch. 567. )

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    If an inspectable record is not kept in written form, the corporation must make it available in written form at its own expense before the inspection request is treated as complied with.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [6310 - 6313] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 6310. If any record subject to inspection pursuant to this chapter is not maintained in written form, a request for inspection is not complied with unless and until the corporation at its expense makes such record available in written form. For the purposes of this chapter “written” or “in writing” also includes cathode ray tube and similar electronic communications methods. (Amended by Stats. 1982, Ch. 662, Sec. 9.)
  27. 6311.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [6310 - 6313] ( Article 1 added by Stats. 1978, Ch. 567. )

    Verify source ↗

    An inspection under this chapter may be done in person or through an agent or attorney, and the inspection right includes copying and making extracts.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [6310 - 6313] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 6311. Any inspection under this chapter may be made in person or by agent or attorney and the right of inspection includes the right to copy and make extracts. (Added by Stats. 1978, Ch. 567.)
  28. 6312.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [6310 - 6313] ( Article 1 added by Stats. 1978, Ch. 567. )

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    Inspection rights under this chapter extend to a corporation’s subsidiary records.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [6310 - 6313] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 6312. Any right of inspection created by this chapter extends to the records of each subsidiary of a corporation. (Added by Stats. 1978, Ch. 567.)
  29. 6313.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [6310 - 6313] ( Article 1 added by Stats. 1978, Ch. 567. )

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    Members’ rights under this chapter cannot be limited by contract, articles, or bylaws.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [6310 - 6313] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 6313. The rights of members provided in this chapter may not be limited by contract or the articles or bylaws. (Added by Stats. 1978, Ch. 567.)
  30. 6320.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Required Records, Reports to Directors and Members [6320 - 6325] ( Article 2 added by Stats. 1978, Ch. 567. )

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    Each corporation must keep adequate books and records, meeting minutes, and a member record with names, addresses, and membership class.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Required Records, Reports to Directors and Members [6320 - 6325] ( Article 2 added by Stats. 1978, Ch. 567. ) ## 6320. (a) Each corporation shall keep: (1) Adequate and correct books and records of account; (2) Minutes of the proceedings of its members, board and committees of the board; and (3) A record of its members giving their names and addresses and the class of membership held by each. (b) Those minutes and other books and records shall be kept either in written form or in any other form capable of being converted into clearly legible tangible form or in any combination of the foregoing. When minutes and other books and records are kept in a form capable of being converted into clearly legible paper form, the clearly legible paper form into which those minutes and other books and records are converted shall be admissible in evidence, and accepted for all other purposes, to the same extent as an original paper record of the same information would have been, provided that the paper form accurately portrays the record. (Amended by Stats. 2004, Ch. 254, Sec. 19. Effective January 1, 2005.)
  31. 6321.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Required Records, Reports to Directors and Members [6320 - 6325] ( Article 2 added by Stats. 1978, Ch. 567. )

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    The board must have an annual report sent to members within 120 days after the fiscal year ends, unless a stated exception applies.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Required Records, Reports to Directors and Members [6320 - 6325] ( Article 2 added by Stats. 1978, Ch. 567. ) ## 6321. (a) Except as provided in subdivision (c), (d), or (f), the board shall cause an annual report to be sent to the members not later than 120 days after the close of the corporation’s fiscal year. Unless otherwise provided by the articles or bylaws and if approved by the board of directors, that report and any accompanying material sent pursuant to this section may be sent by electronic transmission by the corporation (Section 20). That report shall contain in appropriate detail the following: (1) The assets and liabilities, including the trust funds, of the corporation as of the end of the fiscal year. (2) The principal changes in assets and liabilities, including trust funds, during the fiscal year. (3) The revenue or receipts of the corporation, both unrestricted and restricted to particular purposes, for the fiscal year. (4) The expenses or disbursements of the corporation, for both general and restricted purposes, during the fiscal year. (5) Any information required by Section 6322. (b) The report required by subdivision (a) shall be accompanied by any report thereon of independent accountants, or, if there is no such report, the certificate of an authorized officer of the corporation that such statements were prepared without audit from the books and records of the corporation. The report shall be prepared, audited, and made available in the manner required by paragraph (1) of subdivision (e) of Section 12586 of the Government Code, if applicable. (c) Subdivision (a) does not apply to any corporation which receives less than twenty-five thousand dollars ($25,000) in gross revenues or receipts during the fiscal year. (d) Where a corporation has provided, pursuant to Section 5510, for regular meetings of members less often than annually, then the report required by subdivision (a) need be made to members only with the frequency with which regular membership meetings are required, unless the articles or bylaws require a report more often. (e) Subdivisions (c) and (d) notwithstanding, a report with the information required by subdivision (a) shall be furnished annually to all of the following: (1) All directors of the corporation. (2) Any member who requests it in writing. (f) A corporation which in writing solicits contributions from 500 or more persons need not send the report otherwise required by subdivision (a) if it does all of the following: (1) Includes with any written material used to solicit contributions a written statement that its latest annual report will be mailed upon request and that such request may be sent to the corporation at a name and address which is set forth in the statement. The term “annual report” as used in this subdivision refers to the report required by subdivision (a). (2) Promptly mails a copy of its latest annual report to any person who requests a copy thereof. (3) Causes its annual report to be published not later than 120 days after the close of its fiscal year in a newspaper of general circulation in the county in which its principal office is located. (Amended by Stats. 2011, Ch. 442, Sec. 10. (AB 1211) Effective January 1, 2012.)
  32. 6322.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Required Records, Reports to Directors and Members [6320 - 6325] ( Article 2 added by Stats. 1978, Ch. 567. )

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    Every corporation must annually give members and directors a statement about certain covered transactions and indemnifications, with a 120-day mailing/delivery fallback if no annual report is issued to all members.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Required Records, Reports to Directors and Members [6320 - 6325] ( Article 2 added by Stats. 1978, Ch. 567. ) ## 6322. (a) Any provision of the articles or bylaws notwithstanding, every corporation shall furnish annually to its members and directors a statement of any transaction or indemnification of a kind described in subdivision (d) or (e), if any such transaction or indemnification took place. If the corporation issues an annual report to all members, this subdivision shall be satisfied by including the required information in the annual report. A corporation which does not issue an annual report to all members, pursuant to subdivision (c) or (d) of Section 6321, shall satisfy this section by mailing or delivering to its members the required statement within 120 days after the close of the corporation’s fiscal year. Unless otherwise provided by the articles or bylaws and if approved by the board of directors, that statement may be sent by electronic transmission by the corporation (Section 20). (b) Except as provided in subdivision (c), a covered transaction under this section is a transaction in which the corporation, its parent, or its subsidiary was a party, and in which either of the following had a direct or indirect material financial interest: (1) Any director or officer of the corporation, or its parent or subsidiary. (2) Any holder of more than 10 percent of the voting power of the corporation, its parent or its subsidiary. For the purpose of subdivision (d), an “interested person” is any person described in paragraph (1) or (2) of this subdivision. (c) For the purpose of subdivision (b), a mere common directorship is not a material financial interest. (d) The statement required by subdivision (a) shall describe briefly: (1) Any covered transaction during the previous fiscal year involving more than fifty thousand dollars ($50,000), or which was one of a number of covered transactions in which the same interested person had a direct or indirect material financial interest, and which transactions in the aggregate involved more than fifty thousand dollars ($50,000). (2) The names of the interested persons involved in such transactions, stating such person’s relationship to the corporation, the nature of such person’s interest in the transaction and, where practicable, the amount of such interest; provided, that in the case of a transaction with a partnership of which such person is a partner, only the interest of the partnership need be stated. (e) The statement required by subdivision (a) shall describe briefly the amount and circumstances of any indemnifications or advances aggregating more than ten thousand dollars ($10,000) paid during the fiscal year to any officer or director of the corporation pursuant to Section 5238; provided that no such report need be made in the case of indemnification approved by the members (Section 5034) under paragraph (2) of subdivision (e) of Section 5238. (Amended by Stats. 2004, Ch. 254, Sec. 21. Effective January 1, 2005.)
  33. 6323.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Required Records, Reports to Directors and Members [6320 - 6325] ( Article 2 added by Stats. 1978, Ch. 567. )

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    The superior court must enforce the corporation’s duty to send the required information and financial statements, may extend the deadline for good cause, and may award a member reasonable expenses and attorneys’ fees if the failure was without justification.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Required Records, Reports to Directors and Members [6320 - 6325] ( Article 2 added by Stats. 1978, Ch. 567. ) ## 6323. (a) The superior court of the proper county shall enforce the duty of making and mailing or delivering the information and financial statements required by this article and, for good cause shown, may extend the time therefor. (b) In any action or proceeding under this section, if the court finds the failure of the corporation to comply with the requirements of this article to have been without justification, the court may award the member reasonable expenses, including attorneys’ fees, in connection with such action or proceeding. (Added by Stats. 1978, Ch. 567.)
  34. 6324.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Required Records, Reports to Directors and Members [6320 - 6325] ( Article 2 added by Stats. 1978, Ch. 567. )

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    A corporation must give any requesting member a copy of reports filed under Article 7, and it may use a report sent to the Attorney General instead of the annual report if that report includes the required information.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Required Records, Reports to Directors and Members [6320 - 6325] ( Article 2 added by Stats. 1978, Ch. 567. ) ## 6324. (a) Nothing in this part relieves a corporation from the requirements of Article 7 (commencing with Section 12580) of Chapter 6 of Part 2 of Division 3 of the Government Code including, without limitation, subdivision (a) of Section 12586. If a report sent to the Attorney General in compliance with the requirements of Article 7 (commencing with Section 12580) of Chapter 6 of Part 2 of Division 3 of the Government Code includes the information required in the annual report, then the corporation may furnish a copy of its report to the Attorney General in lieu of the annual report, whenever it is required to furnish an annual report. (b) A corporation shall furnish any member who so requests a copy of any report filed by the corporation pursuant to Article 7 (commencing with Section 12580) of Chapter 6 of Part 2 of Division 3 of the Government Code. The corporation may impose reasonable charges for copying and mailing a report furnished under this subdivision. (Amended by Stats. 2011, Ch. 442, Sec. 11. (AB 1211) Effective January 1, 2012.)
  35. 6325.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Required Records, Reports to Directors and Members [6320 - 6325] ( Article 2 added by Stats. 1978, Ch. 567. )

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    A corporation must, on a member’s written request, promptly report vote results for a recent members’ meeting for 60 days after the meeting.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Required Records, Reports to Directors and Members [6320 - 6325] ( Article 2 added by Stats. 1978, Ch. 567. ) ## 6325. For a period of 60 days following the conclusion of an annual, regular, or special meeting of members, a corporation shall, upon written request from a member, forthwith inform the member of the result of any particular vote of members taken at the meeting, including the number of memberships voting for, the number of memberships voting against, and the number of memberships abstaining or withheld from voting. If the matter voted on was the election of directors, the corporation shall report the number of memberships, or votes if voted cumulatively, cast for each nominee for director. If more than one class or series of memberships voted, the report shall state the appropriate numbers by class and series of memberships. (Added by Stats. 1999, Ch. 453, Sec. 7. Effective January 1, 2000.)
  36. 6330.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Rights of Inspection [6330 - 6338] ( Article 3 added by Stats. 1978, Ch. 567. )

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    Members may inspect or obtain certain membership records, but only on written demand and subject to conditions; the corporation can use a reasonable alternative in some cases.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Rights of Inspection [6330 - 6338] ( Article 3 added by Stats. 1978, Ch. 567. ) ## 6330. (a) Subject to Sections 6331 and 6332, and unless the corporation provides a reasonable alternative pursuant to subdivision (c), a member may do either or both of the following as permitted by subdivision (b): (1) Inspect and copy the record of all the members’ names, addresses and voting rights, at reasonable times, upon five business days’ prior written demand upon the corporation which demand shall state the purpose for which the inspection rights are requested; or (2) Obtain from the secretary of the corporation, upon written demand and tender of a reasonable charge, an alphabetized list of the names, addresses, and voting rights of those members entitled to vote for the election of directors, as of the most recent record date for which it has been compiled or as of a date specified by the member subsequent to the date of demand. The demand shall state the purpose for which the list is requested. The membership list shall be made available on or before the later of 10 business days after the demand is received or after the date specified therein as the date as of which the list is to be compiled. (b) The rights set forth in subdivision (a) may be exercised by: (1) Any member, for a purpose reasonably related to the person’s interest as a member. Where the corporation reasonably believes that the information will be used for another purpose, or where it provides a reasonable alternative pursuant to subdivision (c), it may deny the member access to the list. In any subsequent action brought by the member under Section 6336, the court shall enforce the rights set forth in subdivision (a) unless the corporation proves that the member will allow use of the information for purposes unrelated to the person’s interest as a member or that the alternative method offered reasonably achieves the proper purpose set forth in the demand. (2) The authorized number of members for a purpose reasonably related to the members’ interest as members. (c) The corporation may, within 10 business days after receiving a demand under subdivision (a), deliver to the person or persons making the demand a written offer of an alternative method of achieving the purpose identified in the demand without providing access to or a copy of the membership list. An alternative method which reasonably and in a timely manner accomplishes the proper purpose set forth in a demand made under subdivision (a) shall be deemed a reasonable alternative, unless within a reasonable time after acceptance of the offer the corporation fails to do those things which it offered to do. Any rejection of the offer shall be in writing and shall indicate the reasons the alternative proposed by the corporation does not meet the proper purpose of the demand made pursuant to subdivision (a). (Amended by Stats. 1989, Ch. 451, Sec. 1.)
  37. 6331.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Rights of Inspection [6330 - 6338] ( Article 3 added by Stats. 1978, Ch. 567. )

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    This section lets a corporation ask the superior court to stop or limit a membership-list demand, but it must act within short filing deadlines unless excused by excusable neglect.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Rights of Inspection [6330 - 6338] ( Article 3 added by Stats. 1978, Ch. 567. ) ## 6331. (a) Where the corporation, in good faith, and with a substantial basis, believes that the membership list, demanded under Section 6330 by the authorized number (Section 5036), will be used for a purpose not reasonably related to the interests as members of the person or persons making the demand (hereinafter called the requesting parties) as members or provides a reasonable alternative pursuant to subdivision (c) of Section 6330, it may petition the superior court of the proper county for an order setting aside the demand. (b) Except as provided in subdivision (c), a petition for an order to show cause why a protective order pursuant to subdivision (d) should not issue shall be filed within 10 business days after the demand by the authorized number under Section 6330 or receipt of a written rejection by the authorized number of an offer made pursuant to subdivision (c) of Section 6330, whichever is later. The petition shall be accompanied by an application for a hearing on the petition. Upon the filing of the petition, the court shall issue a protective order staying production of the list demanded until the hearing on the order to show cause. The court shall set the hearing on the order to show cause not more than 20 days from the date of the filing of the petition. The order to show cause shall be granted unless the court finds that there is no reasonable probability that the corporation will make the showing required under subdivision (f). (c) A corporation may file a petition under this section more than 10 business days after the demand or rejection under Section 6330, but only upon a showing the delay was caused by excusable neglect. In no event, however, may any petition under this section be considered if filed more than 30 days after the requesting parties’ demand or rejection, whichever is later. (d) Upon the return day of the order to show cause, the court may issue a protective order staying production of the list demanded until final adjudication of the petition filed pursuant to this section. No protective order shall issue under this subdivision unless the court finds that the rights of the requesting parties can reasonably be preserved and that the corporation is likely to make the showing required by subdivision (f) or the court is likely to issue a protective order pursuant to subdivision (g). (e) If the corporation fails to file a petition within the time allowed by subdivision (b) or (c), whichever is applicable, or fails to obtain a protective order under subdivision (d), then the corporation shall comply with the demand, and no further action may be brought by the corporation under this section. (f) The court shall issue the final order setting aside the demand only if the corporation proves: (1) That there is a reasonable probability that the requesting parties will permit use of the membership list for a purpose unrelated to their interests as members; or (2) That the method offered by the corporation is a reasonable alternative in that it reasonably achieves the proper purpose set forth in the requesting parties’ demand and that the corporation intends and is able to effectuate the reasonable alternative. (g) In the final order, the court may, in its discretion, order an alternative mechanism for achieving the proper purposes of the requesting parties, or impose just and proper conditions upon the use of the membership list which reasonably assures compliance with Sections 6330 and 6338. (h) The court shall award reasonable costs and expenses, including reasonable attorneys’ fees, to requesting parties who successfully oppose any petition or application filed pursuant to this section. (i) Where the corporation has neither, within the time allowed, complied with a demand by the authorized number (Section 5036) under Section 6330, nor obtained a protective order staying production of the list, or a final order setting aside the demand, which is then in effect, the requesting parties may petition the superior court of the proper county for a writ of mandamus pursuant to Section 1085 of the Code of Civil Procedure compelling the corporation to comply with the demand. At the hearing, the court shall hear the parties summarily, by affidavit or otherwise, and shall issue a peremptory writ of mandamus unless it appears that the demand was not made by an authorized number (Section 5036), that the demand has been complied with, that the corporation, pursuant to subdivision (c) of Section 6330, made an offer which was not rejected in writing within a reasonable time, or that a protective or final order properly issued under subdivision (d), (f) or (g) is then in effect. No inquiry may be made in such proceeding into the use for which the authorized number seek the list. The court shall award reasonable costs and expenses, including reasonable attorneys’ fees, to persons granted an order under this subdivision. (j) Nothing in this section shall be construed to limit the right of the corporation to obtain damages for any misuse of a membership list obtained under Section 6330, or otherwise, or to obtain injunctive relief necessary to restrain misuse of a member list. A corporation shall be entitled to recover reasonable costs and expenses, including reasonable attorneys’ fees, incurred in successfully bringing any such action. (Amended by Stats. 1979, Ch. 724.)
  38. 6332.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Rights of Inspection [6330 - 6338] ( Article 3 added by Stats. 1978, Ch. 567. )

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    A superior court may restrict Section 6330 inspection rights on petition if needed to protect a member’s constitutional rights, and it may also suspend related time limits in some cases.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Rights of Inspection [6330 - 6338] ( Article 3 added by Stats. 1978, Ch. 567. ) ## 6332. (a) Upon petition of the corporation or any member, the superior court of the proper county may limit or restrict the rights set forth in Section 6330 where, and only where such limitation or restriction is necessary to protect the rights of any member under the Constitution of the United States or the Constitution of the State of California. An order issued pursuant to this subdivision shall provide, insofar as possible, for alternative mechanisms by which the persons seeking to exercise rights under Section 6330 may communicate with members for purposes reasonably related to their interests as members. (b) Upon the filing of a petition under subdivision (a), the court may, if requested by the person making the petition, issue a temporary order suspending the running of any time limit specified in Section 6330 for compliance with that section. Such an order may be extended, after notice and hearing, until final adjudication of the petition, wherever it appears that the petitioner may prevail on the merits, and it is otherwise equitable to do so. (Added by Stats. 1978, Ch. 567.)
  39. 6333.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Rights of Inspection [6330 - 6338] ( Article 3 added by Stats. 1978, Ch. 567. )

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    A member may inspect the corporation’s accounting books, records, and certain minutes if the member makes a written demand, at a reasonable time, for a purpose related to the member’s interests as a member.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Rights of Inspection [6330 - 6338] ( Article 3 added by Stats. 1978, Ch. 567. ) ## 6333. The accounting books and records and minutes of proceedings of the members and the board and committees of the board shall be open to inspection upon the written demand on the corporation of any member at any reasonable time, for a purpose reasonably related to such person’s interests as a member. (Added by Stats. 1978, Ch. 567.)
  40. 6334.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Rights of Inspection [6330 - 6338] ( Article 3 added by Stats. 1978, Ch. 567. )

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    Each director has a right to inspect and copy the corporation’s books, records, and documents, and to inspect its physical properties, at any reasonable time.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Rights of Inspection [6330 - 6338] ( Article 3 added by Stats. 1978, Ch. 567. ) ## 6334. Every director shall have the absolute right at any reasonable time to inspect and copy all books, records and documents of every kind and to inspect the physical properties of the corporation of which such person is a director. (Added by Stats. 1978, Ch. 567.)
  41. 6335.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Rights of Inspection [6330 - 6338] ( Article 3 added by Stats. 1978, Ch. 567. )

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    If delays frustrate a proper inspection demand, the demanding persons may seek a superior court order postponing a previously noticed members’ meeting for the length of the delay.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Rights of Inspection [6330 - 6338] ( Article 3 added by Stats. 1978, Ch. 567. ) ## 6335. Where the proper purpose of the person or persons making a demand pursuant to Section 6330 is frustrated by (1) any delay by the corporation in complying with a demand under Section 6330 beyond the time limits specified therein, or (2) any delay caused by the filing of a petition under Section 6331 or Section 6332, or (3) any delay caused by the alternative proposed under subdivision (c) of Section 6330, the person or persons properly making the demand shall have, in the discretion of the court, a right to obtain from the superior court an order postponing any members’ meeting previously noticed for a period equal to the period of such delay. The members may obtain such an order in a proceeding brought pursuant to Section 6331 upon the filing of a verified complaint in the proper county and after a hearing, notice of which shall be given to such persons and in such manner as the court may direct. Such right shall be in addition to any other legal or equitable remedies to which the member may be entitled. (Amended by Stats. 1979, Ch. 724.)
  42. 6336.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Rights of Inspection [6330 - 6338] ( Article 3 added by Stats. 1978, Ch. 567. )

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    If an inspection demand is refused, the superior court may enforce it or appoint inspectors or accountants; officers and agents must provide books and documents, and the applicant usually pays the expenses.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Rights of Inspection [6330 - 6338] ( Article 3 added by Stats. 1978, Ch. 567. ) ## 6336. (a) Upon refusal of a lawful demand for inspection under this chapter, or a lawful demand pursuant to Section 6330 or Section 6333, the superior court of the proper county, or the county where the books or records in question are kept, may enforce the demand or right of inspection with just and proper conditions or may, for good cause shown, appoint one or more competent inspectors or independent accountants to audit the financial statements kept in this state and investigate the property, funds and affairs of any corporation and of any subsidiary corporation thereof, domestic or foreign, keeping records in this state and to report thereon in such manner as the court may direct. (b) All officers and agents of the corporation shall produce to the inspectors or accountants so appointed all books and documents in their custody or power, under penalty of punishment for contempt of court. (c) All expenses of the investigation or audit shall be defrayed by the applicant unless the court orders them to be paid or shared by the corporation. (Amended by Stats. 1979, Ch. 724.)
  43. 6337.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Rights of Inspection [6330 - 6338] ( Article 3 added by Stats. 1978, Ch. 567. )

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    A court may award a member reasonable costs and expenses, including attorneys’ fees, if the corporation failed without justification to comply with a proper demand, except as required by Section 6331.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Rights of Inspection [6330 - 6338] ( Article 3 added by Stats. 1978, Ch. 567. ) ## 6337. In any action or proceeding under this article, and except as required by Section 6331, if the court finds the failure of the corporation to comply with a proper demand thereunder was without justification, the court may award the member reasonable costs and expenses, including reasonable attorneys’ fees, in connection with such action or proceeding. (Added by Stats. 1978, Ch. 567.)
  44. 6338.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Rights of Inspection [6330 - 6338] ( Article 3 added by Stats. 1978, Ch. 567. )

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    A membership list cannot be used or sold without board consent, and several specific uses are barred unless the board consents.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 13. Records, Reports, and Rights of Inspection [6310 - 6338] ( Chapter 13 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Rights of Inspection [6330 - 6338] ( Article 3 added by Stats. 1978, Ch. 567. ) ## 6338. (a) A membership list is a corporate asset. Without consent of the board a membership list or any part thereof may not be obtained or used by any person for any purpose not reasonably related to a member’s interest as a member. Without limiting the generality of the foregoing, without the consent of the board a membership list or any part thereof may not be: (1) Used to solicit money or property unless such money or property will be used solely to solicit the vote of the members in an election to be held by their corporation. (2) Used for any purpose which the user does not reasonably and in good faith believe will benefit the corporation. (3) Used for any commercial purpose or purpose in competition with the corporation. (4) Sold to or purchased by any person. (b) Any person who violates the provisions of subdivision (a) shall be liable for any damage such violation causes the corporation and shall account for and pay to the corporation any profit derived as a result of such violation. In addition, a court in its discretion may award exemplary damages for a fraudulent or malicious violation of subdivision (a). (c) Nothing in this article shall be construed to limit the right of a corporation to obtain injunctive relief necessary to restrain misuse of a membership list or any part thereof. (d) In any action or proceeding under this section, a court may award the corporation reasonable costs and expenses, including reasonable attorneys’ fees, in connection with such action or proceeding. (e) As used in this section, the term “membership list” means the record of the members’ names and addresses. (Amended by Stats. 1996, Ch. 589, Sec. 18. Effective January 1, 1997.)
  45. 6410.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 14. Service of Process [6410- 6410.] ( Chapter 14 added by Stats. 1978, Ch. 567. )

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    Service of process on a corporation is governed by Chapter 17 (starting with Section 1700) of Division 1 of Title 1.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 14. Service of Process [6410- 6410.] ( Chapter 14 added by Stats. 1978, Ch. 567. ) ## 6410. Service of process upon a corporation shall be governed by Chapter 17 (commencing with Section 1700) of Division 1 of Title 1. (Added by Stats. 1978, Ch. 567.)
  46. 6510.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 15. Involuntary Dissolution [6510 - 6519] ( Chapter 15 added by Stats. 1978, Ch. 567. )

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    This section allows certain people to file a complaint for involuntary dissolution of a corporation in the superior court, and requires the Attorney General to be part of any such action.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 15. Involuntary Dissolution [6510 - 6519] ( Chapter 15 added by Stats. 1978, Ch. 567. ) ## 6510. (a) A complaint for involuntary dissolution of a corporation on any one or more of the grounds specified in subdivision (b) may be filed in the superior court of the proper county by any of the following persons: (1) One-half or more of the directors in office. (2) A person or persons holding or authorized in writing by persons holding not less than 331/3 percent of the voting power exclusive of memberships held by persons who have personally participated in any of the transactions enumerated in paragraph (5) of subdivision (b). (3) Any member if the ground for dissolution is that the period for which the corporation was formed has terminated without extension thereof. (4) Any other person expressly authorized to do so in the articles. (5) The Attorney General. (6) The head organization under whose authority the corporation was created, where the corporation’s articles include the provision authorized by subdivision (a), paragraph (2), clause (i), of Section 5132. (b) The grounds for involuntary dissolution are that: (1) The corporation has abandoned its activity for more than one year. (2) The corporation has an even number of directors who are equally divided and cannot agree as to the management of its affairs, so that its activities can no longer be conducted to advantage or so that there is danger that its property will be impaired or lost or its activities impaired and the members are so divided into factions that they cannot elect a board consisting of an uneven number. (3) There is internal dissension and two or more factions of members in the corporation are so deadlocked that its activities can no longer be conducted with advantage. (4) When during any four-year period or when all voting power has been exercised at two consecutive meetings or in two written ballots for the election of directors, whichever period is shorter, the members have failed to elect successors to directors whose terms have expired or would have expired upon election of their successors. (5) Those in control of the corporation have been guilty of or have knowingly countenanced persistent and pervasive fraud, mismanagement or abuse of authority or the corporation’s property is being misapplied or wasted by its directors or officers. (6) Liquidation is reasonably necessary as the corporation is failing and has continuously failed to carry out its purposes. (7) The period for which the corporation was formed has terminated without extension of such period. (8) The corporation is required to dissolve under the terms of any article provision adopted pursuant to subdivision (a), paragraph (2), clause (i), of Section 5132. (c) At any time prior to the trial of the action any creditor or the authorized number (Section 5036) of members may intervene therein. (d) In any action brought pursuant to subdivision (a), the Attorney General shall be an indispensable party. (Amended by Stats. 1979, Ch. 724.)
  47. 6511.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 15. Involuntary Dissolution [6510 - 6519] ( Chapter 15 added by Stats. 1978, Ch. 567. )

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    The Attorney General may seek judicial dissolution of a corporation for specified misconduct, tax nonpayment, or other grounds, and the court may order dissolution or related relief.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 15. Involuntary Dissolution [6510 - 6519] ( Chapter 15 added by Stats. 1978, Ch. 567. ) ## 6511. (a) The Attorney General may bring an action against any corporation or purported corporation in the name of the people of this state, upon the Attorney General’s own information or upon complaint of a private party, to procure a judgment dissolving the corporation and annulling, vacating or forfeiting its corporate existence upon any of the following grounds: (1) The corporation has seriously offended against any provision of the statutes regulating corporations or charitable organizations. (2) The corporation has fraudulently abused or usurped corporate privileges or powers. (3) The corporation has violated any provision of law by any act or default which under the law is a ground for forfeiture of corporate existence. (4) The corporation has failed to pay to the Franchise Tax Board for a period of five years any tax imposed upon it by the Bank and Corporation Tax Law. (b) If the ground of the action is a matter or act which the corporation has done or omitted to do that can be corrected by amendment of its articles or by other corporate action, such suit shall not be maintained unless (1) the Attorney General, at least 30 days prior to the institution of suit, has given the corporation written notice of the matter or act done or omitted to be done and (2) the corporation has failed to institute proceedings to correct it within the 30-day period or thereafter fails to duly and properly make such amendment or take the corrective corporate action. (c) In any such action the court may order dissolution or such other or partial relief as it deems just and expedient. The court also may appoint a receiver for winding up the affairs of the corporation or may order that the corporation be wound up by its board subject to the supervision of the court. (d) Service of process on the corporation may be made pursuant to Chapter 17 (commencing with Section 1700) of Division 1 or by written notice to the president or secretary of the corporation at the address indicated in the corporation’s last tax return filed pursuant to the Bank and Corporation Tax Law. The Attorney General shall also publish one time in a newspaper of general circulation in the proper county a notice to the members of the corporation. (Added by Stats. 1978, Ch. 567.)
  48. 6512.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 15. Involuntary Dissolution [6510 - 6519] ( Chapter 15 added by Stats. 1978, Ch. 567. )

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    If a corporation’s involuntary dissolution complaint is based on a board deadlock, the court may appoint a provisional director.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 15. Involuntary Dissolution [6510 - 6519] ( Chapter 15 added by Stats. 1978, Ch. 567. ) ## 6512. If the ground for the complaint for involuntary dissolution of the corporation is a deadlock in the board as set forth in paragraph (2) of subdivision (b) of Section 6510, the court may appoint a provisional director. The provisions of subdivision (e) of Section 5225 apply to any such provisional director so appointed. (Added by Stats. 1978, Ch. 567.)
  49. 6513.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 15. Involuntary Dissolution [6510 - 6519] ( Chapter 15 added by Stats. 1978, Ch. 567. )

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    A court may appoint a receiver in an involuntary dissolution case to manage the corporation and preserve its property if the stated risk conditions are met.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 15. Involuntary Dissolution [6510 - 6519] ( Chapter 15 added by Stats. 1978, Ch. 567. ) ## 6513. If, at the time of the filing of a complaint for involuntary dissolution or at any time thereafter, the court has reasonable grounds to believe that unless a receiver of the corporation is appointed the interests of the corporation or the public or charitable purpose of the corporation will suffer pending the hearing and determination of the complaint, upon the application of the plaintiff, and after a hearing upon such notice to the corporation as the court may direct and upon the giving of security pursuant to Sections 566 and 567 of the Code of Civil Procedure, the court may appoint a receiver to take over and manage the affairs of the corporation and to preserve its property pending the hearing and determination of the complaint for dissolution. (Amended by Stats. 1982, Ch. 517, Sec. 188.)
  50. 6514.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 15. Involuntary Dissolution [6510 - 6519] ( Chapter 15 added by Stats. 1978, Ch. 567. )

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    After a hearing, the court may order a nonprofit corporation wound up and dissolved if cause is shown, and may also make other orders or injunctions when justice and equity require.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 15. Involuntary Dissolution [6510 - 6519] ( Chapter 15 added by Stats. 1978, Ch. 567. ) ## 6514. After hearing the court may decree a winding up and dissolution of the corporation if cause therefor is shown or, with or without winding up and dissolution, may make such orders and decrees and issue such injunctions in the case as justice and equity require. (Added by Stats. 1978, Ch. 567.)
  51. 6515.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 15. Involuntary Dissolution [6510 - 6519] ( Chapter 15 added by Stats. 1978, Ch. 567. )

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    This section says involuntary winding-up proceedings start when the winding-up order is entered, the board must carry out the winding up under court supervision, the corporation must stop ordinary activities except as needed for winding up, and directors must mail notice to members, known creditors, and claimants unless the order is stayed or enjoined.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 15. Involuntary Dissolution [6510 - 6519] ( Chapter 15 added by Stats. 1978, Ch. 567. ) ## 6515. (a) Involuntary proceedings for winding up a corporation commence when the order for winding up is entered under Section 6514. (b) When an involuntary proceeding for winding up has commenced, the board shall conduct the winding up of the affairs of the corporation, subject to the supervision of the court, unless other persons are appointed by the court, on good cause shown, to conduct the winding up. The directors or such other persons may, subject to any restrictions imposed by the court, exercise all their powers through the executive officers without any order of court. (c) When an involuntary proceeding for winding up has commenced, the corporation shall cease to conduct its activities except to the extent necessary for the beneficial winding up thereof and except during such period as the board may deem necessary to preserve the corporation’s goodwill or going concern value, pending a sale or other disposition of its assets, or both, in whole or in part. The directors shall cause written notice of the commencement of the proceeding for involuntary winding up to be given by mail to all members and to all known creditors and claimants whose addresses appear on the records of the corporation, unless the order for winding up has been stayed by appeal therefrom or otherwise or the proceeding or the execution of the order has been enjoined. (Added by Stats. 1978, Ch. 567.)
  52. 6516.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 15. Involuntary Dissolution [6510 - 6519] ( Chapter 15 added by Stats. 1978, Ch. 567. )

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    When an involuntary winding-up proceeding has started, the court has broad authority over claims, accounts, directors, vacancies, stays, dissolution, parties, and charitable-trust assets.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 15. Involuntary Dissolution [6510 - 6519] ( Chapter 15 added by Stats. 1978, Ch. 567. ) ## 6516. When an involuntary proceeding for winding up has been commenced, the jurisdiction of the court includes: (a) The requirement of the proof of all claims and demands against the corporation, whether due or not yet due, contingent, unliquidated or sounding only in damages, and the barring from participation of creditors and claimants failing to make and present claims and proof as required by any order. (b) The determination or compromise of all claims of every nature against the corporation or any of its property, and the determination of the amount of money or assets required to be retained to pay or provide for the payment of claims. (c) The presentation and filing of intermediate and final accounts of the directors or other persons appointed to conduct the winding up and hearing thereon, the allowance, disallowance or settlement thereof and the discharge of the directors or such other persons from their duties and liabilities. (d) The appointment of a commissioner to hear and determine any or all matters, with such power or authority as the court may deem proper. (e) The filling of any vacancies on the board which the directors or members are unable to fill. (f) The removal of any director if it appears that the director has been guilty of dishonesty, misconduct, neglect or breach of trust in conducting the winding up or if the director is unable to act. The court may order an election to fill the vacancy so caused, and may enjoin, for such time as it considers proper, the reelection of the director so removed; or the court, in lieu of ordering an election, may appoint a director to fill the vacancy caused by such removal. Any director so appointed by the court shall serve until the next regular meeting of members or until a successor is elected or appointed. (g) The staying of the prosecution of any suit, proceeding or action against the corporation and requiring the parties to present and prove their claims in the manner required of other creditors. (h) The determination of whether adequate provision has been made for payment or satisfaction of all debts and liabilities not actually paid. (i) The making of orders for the withdrawal or termination of proceedings, to windup and dissolve, subject to conditions for the protection of creditors. (j) The making of an order, upon the allowance or settlement of the final accounts of the directors or such other persons, that the corporation has been duly wound up and is dissolved. Upon the making of such order, the corporate existence shall cease except for purposes of further winding up if needed. (k) The making of orders for the bringing in of new parties as the court deems proper for the determination of all questions and matters. (l) The disposition of assets held in charitable trust. (Added by Stats. 1978, Ch. 567.)
  53. 6517.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 15. Involuntary Dissolution [6510 - 6519] ( Chapter 15 added by Stats. 1978, Ch. 567. )

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    The court sets a deadline for creditors and claimants to file claims, and late claims may be allowed in some cases.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 15. Involuntary Dissolution [6510 - 6519] ( Chapter 15 added by Stats. 1978, Ch. 567. ) ## 6517. (a) All creditors and claimants may be barred from participation in any distribution of the general assets if they fail to make and present claims and proofs within such time as the court may direct, which shall not be less than four nor more than six months after the first publication of notice to creditors unless it appears by affidavit that there are no claims, in which case the time limit may be three months. If it is shown that a claimant did not receive notice because of absence from the state or other cause, the court may allow a claim to be filed or presented at any time before distribution is completed. (b) Such notice to creditors shall be published not less than once a week for three consecutive weeks in a newspaper of general circulation published in the county in which the proceeding is pending or, if there is no such newspaper published in that county, in such newspaper as may be designated by the court, directing creditors and claimants to make and present claims and proofs to the person, at the place and within the time specified in the notice. A copy of the notice shall be mailed to each person shown as a creditor or claimant on the books of the corporation, at such person’s last known address. (c) Holders of secured claims may prove for the whole debt in order to realize any deficiency. If such creditors fail to present their claims they shall be barred only as to any right to claim against the general assets for any deficiency in the amount realized on their security. (d) Before any distribution is made the amount of any unmatured, contingent or disputed claim against the corporation which has been presented and has not been disallowed, or such part of any such claim as the holder would be entitled to if the claim were due, established or absolute, shall be paid into court and there remain to be paid over to the party when the party becomes entitled thereto or, if the party fails to establish a claim, to be paid over or distributed with the other assets of the corporation to those entitled thereto; or such other provision for the full payment of such claim, if and when established, shall be made as the court may deem adequate. A creditor whose claim has been allowed but is not yet due shall be entitled to its present value upon distribution. (e) Suits against the corporation on claims which have been rejected shall be commenced within 30 days after written notice of rejection thereof is given to the claimant. (Added by Stats. 1978, Ch. 567.)
  54. 6518.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 15. Involuntary Dissolution [6510 - 6519] ( Chapter 15 added by Stats. 1978, Ch. 567. )

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    The court may order a nonprofit public benefit corporation wound up and dissolved when the required accounts are settled and the corporation is ready to be dissolved.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 15. Involuntary Dissolution [6510 - 6519] ( Chapter 15 added by Stats. 1978, Ch. 567. ) ## 6518. (a) Upon the final settlement of the accounts of the directors or other persons appointed pursuant to Section 6515 and the determination that the corporation’s affairs are in condition for it to be dissolved, the court may make an order declaring the corporation duly wound up and dissolved. The order shall declare: (1) That the corporation has been duly wound up, that a final franchise tax return, as described by Section 23332 of the Revenue and Taxation Code, has been 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 and that its known debts and liabilities have been paid or adequately provided for, or that those debts and liabilities have been paid as far as its assets permitted, as the case may be. If there are known debts or liabilities for payment of which adequate provision has been made, the order shall state what provision has been made, setting forth the name and address of the corporation, person or governmental agency that has assumed or guaranteed the payment, or the name and address of the depositary with which deposit has been made or such other information as may be necessary to enable the creditor or other person to whom payment is to be made to appear and claim payment of the debt or liability. (2) That its known assets have been distributed to the persons entitled thereto or that it acquired no known assets, as the case may be. (3) That the accounts of directors or such other persons have been settled and that they are discharged from their duties and liabilities to creditors and members. (4) That the corporation is dissolved. (b) In an action brought by, and at the request of, the Attorney General, the court may make an order declaring that a corporation is wound up and dissolved without meeting the requirements in subdivision (a), upon a finding by the court that it is impossible or impracticable to meet some or all of those requirements. (c) The court may make such additional orders and grant such further relief as it deems proper upon the evidence submitted. (d) Upon the making of the order declaring the corporation dissolved, corporate existence shall cease except for the purposes of further winding up if needed; and the directors or such other persons shall be discharged from their duties and liabilities, except as otherwise ordered by the court and in respect to completion of the winding up. (Amended by Stats. 2008, Ch. 715, Sec. 2. Effective January 1, 2009.)
  55. 6519.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 15. Involuntary Dissolution [6510 - 6519] ( Chapter 15 added by Stats. 1978, Ch. 567. )

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    If a corporation is dissolved or forfeits its existence by a court order, a certified copy of the order must be filed right away, and the Secretary of State must notify the Franchise Tax Board.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 15. Involuntary Dissolution [6510 - 6519] ( Chapter 15 added by Stats. 1978, Ch. 567. ) ## 6519. Whenever a corporation is dissolved or its existence forfeited by order, decree or judgment of a court, a copy of the order, decree or judgment, certified by the clerk of court, shall forthwith be filed. The Secretary of State shall notify the Franchise Tax Board of the dissolution. (Amended by Stats. 2006, Ch. 773, Sec. 20. Effective September 29, 2006.)
  56. 6610.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 16. Voluntary Dissolution [6610 - 6618] ( Chapter 16 added by Stats. 1978, Ch. 567. )

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    Corporations may voluntarily wind up and dissolve if the required member or board approvals are obtained, and some corporations may do so by board approval alone when specified conditions are met.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 16. Voluntary Dissolution [6610 - 6618] ( Chapter 16 added by Stats. 1978, Ch. 567. ) ## 6610. (a) Any corporation may elect voluntarily to wind up and dissolve (1) by approval of a majority of all members (Section 5033) or (2) by approval of the board and approval of the members (Section 5034). (b) Any corporation which comes within one of the following descriptions may elect by approval of the board to wind up and dissolve: (1) A corporation which has been the subject of an order for relief in bankruptcy. (2) A corporation which has disposed of all of its assets and has not conducted any activity for a period of five years immediately preceding the adoption of the resolution electing to dissolve the corporation. (3) A corporation which has no members. (4) A corporation which is required to dissolve under provisions of its articles adopted pursuant to subparagraph (A) of paragraph (2) of subdivision (a), of Section 5132. (c) If a corporation comes within one of the descriptions in subdivision (b) and the number of directors then in office is less than a quorum, the corporation may elect to voluntarily wind up and dissolve by any of the following: (1) The unanimous consent of the directors then in office. (2) The affirmative vote of a majority of the directors then in office at a meeting held pursuant to waiver of notice by those directors complying with subdivision (a) of Section 5211. (3) The vote of a sole remaining director. (d) If a corporation elects to voluntarily wind up and dissolve pursuant to subdivision (c), references to the board in this chapter and Chapter 17 (commencing with Section 6710) shall be deemed to be to a board consisting solely of those directors or that sole director and action by the board shall require at least the same consent or vote as would be required under subdivision (c) for an election to wind up and dissolve. (Amended by Stats. 2009, Ch. 631, Sec. 15. (AB 1233) Effective January 1, 2010.)
  57. 6610.5.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 16. Voluntary Dissolution [6610 - 6618] ( Chapter 16 added by Stats. 1978, Ch. 567. )

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    This section lets certain nonprofit corporation leaders sign a dissolution certificate when the corporation has no memberships, and requires the certificate to be filed with the Secretary of State.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 16. Voluntary Dissolution [6610 - 6618] ( Chapter 16 added by Stats. 1978, Ch. 567. ) ## 6610.5. (a) Notwithstanding any other provision of this division, when a corporation has not issued any memberships, a majority of the directors, or, if no directors have been named in the articles or have been elected, the incorporator or a majority of the incorporators, may sign and verify a certificate of dissolution stating all of the following: (1) That the certificate of dissolution is being filed within 24 months from the date the articles of incorporation were filed. (2) That the corporation does not have any debts or other liabilities, except as provided in paragraph (3) and subdivision (d). (3) That the tax liability will be satisfied on a taxes-paid basis or that a person or corporation or other business entity assumes the tax liability, if any, of the dissolving corporation and is responsible for additional corporate taxes, if any, that are assessed and that become due after the date of the assumption of the tax liability. (4) 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. (5) That the corporation was created in error. (6) That the known assets of the corporation remaining after payment of, or adequately providing for, known debts and liabilities have been distributed as required by law or that the corporation acquired no known assets, as the case may be. (7) That a majority of the directors, or, if no directors have been named in the articles or have been elected, the incorporator or a majority of the incorporators authorized the dissolution and elected to dissolve the corporation. (8) That the corporation has not issued any memberships, and if the corporation has received payments for memberships, those payments have been returned to those making the payments. (9) That the corporation is dissolved. (b) A certificate of dissolution signed and verified pursuant to subdivision (a) shall be filed with the Secretary of State. The Secretary of State shall notify the Franchise Tax Board and the Attorney General’s Registry of Charities and Fundraisers of the dissolution. (c) Upon filing a certificate of dissolution pursuant to subdivision (b), a corporation shall be dissolved and its powers, rights, and privileges shall cease. (d) Notwithstanding the dissolution of a corporation pursuant to this section, its liability to creditors, if any, is not discharged. The liability of the directors of, or other persons related to, the dissolved corporation is not discharged. The 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. (Amended by Stats. 2023, Ch. 478, Sec. 19. (AB 1756) Effective January 1, 2024.)
  58. 6611.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 16. Voluntary Dissolution [6610 - 6618] ( Chapter 16 added by Stats. 1978, Ch. 567. )

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    A corporation that has elected to wind up and dissolve must file a certificate of that election and send a copy to the Attorney General.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 16. Voluntary Dissolution [6610 - 6618] ( Chapter 16 added by Stats. 1978, Ch. 567. ) ## 6611. (a) Whenever a corporation has elected to wind up and dissolve a certificate evidencing that election shall forthwith be filed and a copy thereof filed with the Attorney General. (b) The certificate shall be an officers’ certificate or shall be signed and verified by at least a majority of the directors then in office or by one or more members authorized to do so by approval of a majority of all members (Section 5033) and shall set forth: (1) That the corporation has elected to wind up and dissolve. (2) If the election was made by the vote of members alone, the number of votes for the election and that the election was made by a majority of all members (Section 5033). (3) If the election was made by the board and members pursuant to paragraph (2) of subdivision (a) of Section 6610, or subparagraph (B) of paragraph (1) of subdivision (b) of Section 9680, the certificate shall state that it was made by the board and the members in accordance with Section 5034. (4) If the certificate is executed by a member or members, that the subscribing person or persons were authorized to execute the certificate by a majority of all members (Section 5033). (5) If the election was made by the board pursuant to subdivision (b) of Section 6610, or paragraph (2) of subdivision (b) of Section 9680, the circumstances showing the corporation to be within one of the categories described in that subdivision. (c) If an election to dissolve made pursuant to subdivision (a) of Section 6610 or paragraph (1) of subdivision (b) of Section 9680 is made by the vote of all the members of a corporation with members or by all members of the board of a corporation without members pursuant to subdivision (b) of Section 6610, or paragraph (2) of subdivision (b) of Section 9680 and a statement to that effect is added to the certificate of dissolution pursuant to Section 6615, the separate filing of the certificate of election pursuant to this section is not required. (Amended by Stats. 2014, Ch. 834, Sec. 13. (SB 1041) Effective January 1, 2015.)
  59. 6612.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 16. Voluntary Dissolution [6610 - 6618] ( Chapter 16 added by Stats. 1978, Ch. 567. )

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    A corporation may revoke a voluntary decision to wind up and dissolve before any assets are distributed, but it must then sign, verify, and file a revocation certificate and send a copy to the Attorney General.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 16. Voluntary Dissolution [6610 - 6618] ( Chapter 16 added by Stats. 1978, Ch. 567. ) ## 6612. (a) A voluntary election to wind up and dissolve may be revoked prior to distribution of any assets: (1) if the election was made pursuant to paragraph (1) of subdivision (a) of Section 6610, by the vote of a majority of all members (Section 5033); or (2) if the election was made pursuant to paragraph (2) of subdivision (a) of Section 6610, by the approval of the board and the members (Section 5034); or (3) if the election was by the board pursuant to subdivision (b) of Section 6610, by approval of the board. Thereupon a certificate evidencing the revocation shall be signed, verified and filed in the manner prescribed by Section 6611 and a copy thereof filed with the Attorney General. (b) The certificate shall set forth: (1) That the corporation has revoked its election to wind up and dissolve. (2) That no assets have been distributed pursuant to the election. (3) If the revocation was made by the vote of members alone, the number of votes for the revocation and that the revocation was made by a majority of all members (Section 5033). (4) If the revocation was made by the board and members pursuant to paragraph (2) of subdivision (a) of Section 6612, the certificate shall so state. (5) If the revocation was made by the board alone, the certificate shall so state. (Amended by Stats. 1979, Ch. 724.)
  60. 6613.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 16. Voluntary Dissolution [6610 - 6618] ( Chapter 16 added by Stats. 1978, Ch. 567. )

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    When voluntary winding up starts, the board keeps acting and can finish winding up the corporation’s affairs, while the corporation generally stops operating except as needed for winding up and preserving value.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 16. Voluntary Dissolution [6610 - 6618] ( Chapter 16 added by Stats. 1978, Ch. 567. ) ## 6613. (a) Voluntary proceedings for winding up the corporation commence upon the adoption of the resolution required by Section 6610 by the members, by the board and members, or by the board alone, electing to wind up and dissolve. (b) When a voluntary proceeding for winding up has commenced, the board shall continue to act as a board and shall have full powers to wind up and settle its affairs, both before and after the filing of the certificate of dissolution. (c) When a voluntary proceeding for winding up has commenced, the corporation shall cease to conduct its activities except to the extent necessary for the beneficial winding up thereof, to the extent necessary to carry out its purposes and except during such period as the board may deem necessary to preserve the corporation’s goodwill or going-concern value pending a sale or other disposition of its assets, or both, in whole or in part. The board shall cause written notice of the commencement of the proceeding for voluntary winding up to be given by mail to all its members (except no notice need be given to the members who voted in favor of winding up and dissolving the corporation), to all known creditors and claimants whose addresses appear on the records of the corporation, and to the Attorney General. (Added by Stats. 1978, Ch. 567.)
  61. 6614.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 16. Voluntary Dissolution [6610 - 6618] ( Chapter 16 added by Stats. 1978, Ch. 567. )

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    A superior court may take jurisdiction over a voluntary winding up proceeding and may issue orders about the winding up if the statutory conditions are met.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 16. Voluntary Dissolution [6610 - 6618] ( Chapter 16 added by Stats. 1978, Ch. 567. ) ## 6614. If a corporation is in the process of voluntary winding up, the superior court of the proper county, upon the petition of (a) the corporation, or (b) the authorized number (Section 5036), or (c) the Attorney General, or (d) three or more creditors, and upon such notice to the corporation and to other persons interested in the corporation as members and creditors as the court may order, may take jurisdiction over such voluntary winding up proceeding if that appears necessary for the protection of any parties in interest or if it appears necessary to protect the purpose or purposes served by the corporation. The court, if it assumes jurisdiction, may make such orders as to any and all matters concerning the winding up of the affairs of the corporation and the protection of its creditors, its assets and its purpose or purposes as justice and equity may require. The provisions of Chapter 15 (commencing with Section 6510) (except Sections 6510 and 6511) shall apply to such court proceedings. (Added by Stats. 1978, Ch. 567.)
  62. 6615.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 16. Voluntary Dissolution [6610 - 6618] ( Chapter 16 added by Stats. 1978, Ch. 567. )

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    After a corporation is fully wound up, the directors must sign and verify a certificate of dissolution with specified statements, and the Secretary of State may not accept filing without the required attachment unless an exception applies.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 16. Voluntary Dissolution [6610 - 6618] ( Chapter 16 added by Stats. 1978, Ch. 567. ) ## 6615. (a) When a corporation has been completely wound up without court proceedings, a majority of the directors then in office shall sign and verify a certificate of dissolution stating: (1) That the corporation has been completely wound up. (2) That its known debts and liabilities have been actually paid, or adequately provided for, or paid or adequately provided for as far as its assets permitted, or that it has incurred no known debts or liabilities, as the case may be. If there are known debts or liabilities for payment of which adequate provision has been made, the certificate shall state what provision has been made, setting forth the name and address of the corporation, person or governmental agency that has assumed or guaranteed the payment, or the name and address of the depositary with which deposit has been made or other information as may be necessary to enable the creditor or other person to whom payment is to be made to appear and claim payment of the debt or liability. (3) That the corporation is dissolved. (4) That all final returns required under the Revenue and Taxation Code have been or will be filed with the Franchise Tax Board. (5) That the corporation, if applicable, is a committee, as defined in Section 82013 of the Government Code, that is required to and does file any statement pursuant to the provisions of Article 2 (commencing with Section 84200) of Chapter 4 of Title 9 of the Government Code and is exempt from the supervisory authority of the Attorney General pursuant to Sections 12581 and 12583 of the Government Code and is exempt from and not required to file the attachment specified in subdivision (b). (b) Except as provided in subdivision (c), one of the following documents issued by the Attorney General shall be attached to the certificate of dissolution: (1) A written waiver of objections to the distribution of the corporation’s assets pursuant to subdivision (c) of Section 6716. (2) A written confirmation that the corporation has no assets. (c) The certificate of dissolution and attachment described in subdivision (b) shall be filed with the Secretary of State. The Secretary of State shall not accept a certificate of dissolution for filing without this attachment unless the attachment is not required as specified in paragraph (5) of subdivision (a). The corporate existence shall cease upon the acceptance of the filing of the certificate of dissolution and, if required, the attachment, by the Secretary of State, except for the purpose of further winding up if needed. The Secretary of State shall notify the Franchise Tax Board of the dissolution. (Amended by Stats. 2011, Ch. 442, Sec. 12. (AB 1211) Effective January 1, 2012.)
  63. 6616.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 16. Voluntary Dissolution [6610 - 6618] ( Chapter 16 added by Stats. 1978, Ch. 567. )

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    When a corporation’s term ends without renewal or extension, the board must stop activities and wind up the corporation’s affairs, and then a majority of directors must file a certificate meeting Section 6615 requirements.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 16. Voluntary Dissolution [6610 - 6618] ( Chapter 16 added by Stats. 1978, Ch. 567. ) ## 6616. Except as otherwise provided by law, if the term of existence for which any corporation was organized expires without renewal or extension thereof, the board shall terminate its activities and wind up its affairs; and when the affairs of the corporation have been wound up a majority of the directors shall execute and file a certificate conforming to the requirements of Section 6615. (Added by Stats. 1978, Ch. 567.)
  64. 6617.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 16. Voluntary Dissolution [6610 - 6618] ( Chapter 16 added by Stats. 1978, Ch. 567. )

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    The board may ask the superior court to declare the corporation wound up and dissolved, and the court must give notice and allow interested persons to object.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 16. Voluntary Dissolution [6610 - 6618] ( Chapter 16 added by Stats. 1978, Ch. 567. ) ## 6617. (a) The board, in lieu of filing the certificate of dissolution, may petition the superior court of the proper county for an order declaring the corporation duly wound up and dissolved. Such petition shall be filed in the name of the corporation. (b) Upon the filing of the petition, the court shall make an order requiring all persons, including the Attorney General, interested to show cause why an order shall not be made declaring the corporation duly wound up and dissolved and shall direct that the order be served by notice to all creditors, claimants and members in the same manner as the notice given under subdivision (b) of Section 6517. Notice shall be served upon the Attorney General. (c) Any person claiming to be interested as creditor or otherwise may appear in the proceeding at any time before the expiration of 30 days from the completion of publication of the order to show cause and contest the petition, and upon failure to appear such person’s claim shall be barred. (d) Thereafter an order shall be entered and filed and have the effect as prescribed in Sections 6518 and 6519. (Added by Stats. 1978, Ch. 567.)
  65. 6618.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 16. Voluntary Dissolution [6610 - 6618] ( Chapter 16 added by Stats. 1978, Ch. 567. )

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    A nonprofit corporation winding up voluntarily may handle known claims using this section’s notice and deadline process.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 16. Voluntary Dissolution [6610 - 6618] ( Chapter 16 added by Stats. 1978, Ch. 567. ) ## 6618. (a) A corporation in the process of voluntary winding up may dispose of the known claims against it by following the procedure described in this section. (b) The written notice to known creditors and claimants required by subdivision (c) of Section 6613 shall comply with all of the following requirements: (1) Describe any information that must be included in a claim. (2) Provide a mailing address where a claim may be sent. (3) State the deadline, which may not be fewer than 120 days from the effective date of the written notice, by which the corporation must receive the claim. (4) State that the claim will be barred if not received by the deadline. (c) A claim against the corporation is barred if any of the following occur: (1) A claimant who has been given the written notice under subdivision (b) does not deliver the claim to the corporation by the deadline. (2) A claimant whose claim was rejected by the corporation does not commence a proceeding to enforce the claim within 90 days from the effective date of the rejection notice. (d) For purposes of this section “claim” does not include a contingent liability or a claim based on an event occurring after the effective date of dissolution. (Added by Stats. 1996, Ch. 589, Sec. 19. Effective January 1, 1997.)
  66. 6710.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 17. General Provisions Relating to Dissolution [6710 - 6721] ( Chapter 17 added by Stats. 1978, Ch. 567. )

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    After a dissolution proceeding starts, directors, court-appointed persons, and officers may take listed steps to wind up and liquidate the corporation.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 17. General Provisions Relating to Dissolution [6710 - 6721] ( Chapter 17 added by Stats. 1978, Ch. 567. ) ## 6710. The powers and duties of the directors (or other persons appointed by the court pursuant to Section 6515) and officers after commencement of a dissolution proceeding include, but are not limited to, the following acts in the name and on behalf of the corporation: (a) To elect officers and to employ agents and attorneys to liquidate or wind up its affairs. (b) To continue the conduct of the affairs of the corporation insofar as necessary for the disposal or winding up thereof. (c) To carry out contracts and collect, pay, compromise and settle debts and claims for or against the corporation. (d) To defend suits brought against the corporation. (e) To sue, in the name of the corporation, for all sums due or owing to the corporation or to recover any of its property. (f) To collect any amounts remaining unpaid on memberships or to recover unlawful distributions. (g) Subject to the provisions of Section 5142, to sell at public or private sale, exchange, convey or otherwise dispose of all or any part of the assets of the corporation for an amount deemed reasonable by the board without compliance with the provisions of Section 5911, and to execute bills of sale and deeds of conveyance in the name of the corporation. (h) In general, to make contracts and to do any and all things in the name of the corporation which may be proper or convenient for the purposes of winding up, settling and liquidating the affairs of the corporation. (Amended by Stats. 1979, Ch. 724.)
  67. 6711.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 17. General Provisions Relating to Dissolution [6710 - 6721] ( Chapter 17 added by Stats. 1978, Ch. 567. )

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    A board vacancy may be filled during a winding up proceeding under the method set out in Section 5224.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 17. General Provisions Relating to Dissolution [6710 - 6721] ( Chapter 17 added by Stats. 1978, Ch. 567. ) ## 6711. A vacancy on the board may be filled during a winding up proceeding in the manner provided in Section 5224. (Added by Stats. 1978, Ch. 567.)
  68. 6712.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 17. General Provisions Relating to Dissolution [6710 - 6721] ( Chapter 17 added by Stats. 1978, Ch. 567. )

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    When directors’ identity or ability to serve is uncertain, an interested person, including the Attorney General, may ask the superior court to decide who the directors are or appoint directors to wind up the corporation.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 17. General Provisions Relating to Dissolution [6710 - 6721] ( Chapter 17 added by Stats. 1978, Ch. 567. ) ## 6712. When the identity of the directors or their right to hold office is in doubt, or if they are dead or unable to act, or they fail or refuse to act or their whereabouts cannot be ascertained, any interested person, including the Attorney General, may petition the superior court of the proper county to determine the identity of the directors or, if there are no directors, to appoint directors to wind up the affairs of the corporation, after hearing upon such notice to such persons as the court may direct. (Added by Stats. 1978, Ch. 567.)
  69. 6713.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 17. General Provisions Relating to Dissolution [6710 - 6721] ( Chapter 17 added by Stats. 1978, Ch. 567. )

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    The board must distribute remaining corporate assets after known debts and liabilities are paid or adequately provided for, unless a court-supervised winding up requires waiting for the claims period to end.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 17. General Provisions Relating to Dissolution [6710 - 6721] ( Chapter 17 added by Stats. 1978, Ch. 567. ) ## 6713. (a) After determining that all the known debts and liabilities of a corporation in the process of winding up have been paid or adequately provided for, the board shall distribute all the remaining corporate assets in the manner provided in Sections 6715 and 6716. (b) If the winding up is by court proceeding or subject to court supervision, the distribution shall not be made until after the expiration of any period for the presentation of claims that has been prescribed by order of the court. (c) Anything to the contrary notwithstanding, assets, if any, which are not subject to attachment, execution or sale for the corporation’s debts and liabilities may be distributed pursuant to Sections 6715 and 6716 even though all debts and liabilities have not been paid or adequately provided for. (Added by Stats. 1978, Ch. 567.)
  70. 6714.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 17. General Provisions Relating to Dissolution [6710 - 6721] ( Chapter 17 added by Stats. 1978, Ch. 567. )

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    A debt or liability is treated as adequately provided for if it is covered by one of the listed methods.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 17. General Provisions Relating to Dissolution [6710 - 6721] ( Chapter 17 added by Stats. 1978, Ch. 567. ) ## 6714. The payment of a debt or liability, whether the whereabouts of the creditor is known or unknown, has been adequately provided for if the payment has been provided for by either of the following means: (a) Payment thereof has been assumed or guaranteed in good faith by one or more financially responsible persons or by the United States government or any agency thereof, and the provision (including the financial responsibility of such persons) was determined in good faith and with reasonable care by the board to be adequate at the time of any distribution of the assets by the board pursuant to this chapter. (b) The amount of the debt or liability has been deposited as provided in Section 6718. This section does not prescribe the exclusive means of making adequate provision for debts and liabilities. (Amended by Stats. 1979, Ch. 724.)
  71. 6715.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 17. General Provisions Relating to Dissolution [6710 - 6721] ( Chapter 17 added by Stats. 1978, Ch. 567. )

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    After complying with Section 6713, a corporation must return, transfer, or convey assets held under a valid condition if the condition has occurred or will occur because of the dissolution.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 17. General Provisions Relating to Dissolution [6710 - 6721] ( Chapter 17 added by Stats. 1978, Ch. 567. ) ## 6715. After complying with the provisions of Section 6713, assets held by a corporation upon a valid condition requiring return, transfer, or conveyance, which condition has occurred or will occur by reason of the dissolution, shall be returned, transferred, or conveyed in accordance with the condition. (Added by Stats. 1978, Ch. 567.)
  72. 6716.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 17. General Provisions Relating to Dissolution [6710 - 6721] ( Chapter 17 added by Stats. 1978, Ch. 567. )

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    When a nonprofit corporation dissolves, its assets must be disposed of according to its articles or bylaws, subject to any trust terms and certain court and Attorney General procedures.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 17. General Provisions Relating to Dissolution [6710 - 6721] ( Chapter 17 added by Stats. 1978, Ch. 567. ) ## 6716. After complying with the provisions of Section 6713: (a) Except as provided in Section 6715, all of a corporation’s assets shall be disposed of on dissolution in conformity with its articles or bylaws subject to complying with the provisions of any trust under which such assets are held. (b) Except as provided in subdivision (c), the disposition required in subdivision (a) shall be made by decree of the superior court of the proper county in proceedings to which the Attorney General is a party. The decree shall be made upon petition therefor by the Attorney General or, upon 30 days’ notice to the Attorney General, by any person concerned in the dissolution. (c) The disposition required in subdivision (a) may be made without the decree of the superior court, subject to the rights of persons concerned in the dissolution, if the Attorney General makes a written waiver of objections to the disposition. (d) Subdivisions (b) and (c) shall not be applicable to any corporation as described in paragraph (5) of subdivision (a) of Section 6615. (Amended by Stats. 2011, Ch. 442, Sec. 13. (AB 1211) Effective January 1, 2012.)
  73. 6717.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 17. General Provisions Relating to Dissolution [6710 - 6721] ( Chapter 17 added by Stats. 1978, Ch. 567. )

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    Dissolution asset distributions may be made in money, property, or securities, either in installments or as a lump sum, subject to any trust terms.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 17. General Provisions Relating to Dissolution [6710 - 6721] ( Chapter 17 added by Stats. 1978, Ch. 567. ) ## 6717. Subject to the provisions of any trust under which assets to be distributed are held, distribution may be made either in money or in property or securities and either in installments from time to time or as a whole, if this can be done fairly and ratably and in conformity with the provisions of the articles and bylaws and shall be made as soon as reasonably consistent with the beneficial liquidation of the corporation’s assets. (Added by Stats. 1978, Ch. 567.)
  74. 6718.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 17. General Provisions Relating to Dissolution [6710 - 6721] ( Chapter 17 added by Stats. 1978, Ch. 567. )

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    A corporation may deposit certain unclaimed, refused, unknown, or disputed payments or claim amounts with the Controller in trust, and the depositary must later pay the money over to the lawful owner on proof of title.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 17. General Provisions Relating to Dissolution [6710 - 6721] ( Chapter 17 added by Stats. 1978, Ch. 567. ) ## 6718. (a) If any creditors or other persons are unknown or fail or refuse to accept their payment or distribution in cash or property or their whereabouts cannot be ascertained after diligent inquiry, or the existence or amount of a claim of a creditor or other person is contingent, contested, or not determined, the corporation may deposit any such payment, distribution, or the maximum amount of the claim with the Controller in trust for the benefit of those lawfully entitled to the payment, distribution, or the amount of the claim. The payment or distribution shall be paid over by the depositary to the lawful owners, their representatives or assigns, upon satisfactory proof of title. (b) For the purpose of providing for the transmittal, receipt, accounting for, claiming, management, and investment of all money or other property deposited with the Controller under subdivision (a), the money or other property shall be deemed to be paid or delivered for deposit with the Controller under Chapter 7 (commencing with Section 1500) of Title 10 of Part 3 of the Code of Civil Procedure, and may be recovered in the manner prescribed in that chapter. (Amended by Stats. 1996, Ch. 860, Sec. 2. Effective January 1, 1997.)
  75. 6719.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 17. General Provisions Relating to Dissolution [6710 - 6721] ( Chapter 17 added by Stats. 1978, Ch. 567. )

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    If a dissolving corporation distributed assets before paying or adequately providing for debts, the corporation may recover the improper distribution, and the Attorney General or creditors may sue to enforce that liability.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 17. General Provisions Relating to Dissolution [6710 - 6721] ( Chapter 17 added by Stats. 1978, Ch. 567. ) ## 6719. (a) Whenever in the process of winding up a corporation any distribution of assets has been made, otherwise than under an order of court, without prior payment or adequate provision for payment of any of the debts and liabilities of the corporation, any amount so improperly distributed to any person may be recovered by the corporation. Any of such persons may be joined as defendants in the same action or be brought in on the motion of any other defendant. (b) Suit may be brought in the name of the corporation to enforce the liability under subdivision (a) against any or all persons receiving the distribution by the Attorney General or by any one or more creditors of the corporation, whether or not they have reduced their claims to judgment. (c) As used in this section, “process of winding up” includes proceedings under Chapters 15 (commencing with Section 6510) and 16 (commencing with Section 6610) and also any other distribution of assets to persons made in contemplation of termination or abandonment of the corporate business. (Added by Stats. 1978, Ch. 567.)
  76. 6720.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 17. General Provisions Relating to Dissolution [6710 - 6721] ( Chapter 17 added by Stats. 1978, Ch. 567. )

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    A dissolved corporation may keep existing only to wind up its affairs, handle actions and obligations, and distribute property and assets; it may not keep carrying on its normal activities except as needed for winding up.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 17. General Provisions Relating to Dissolution [6710 - 6721] ( Chapter 17 added by Stats. 1978, Ch. 567. ) ## 6720. (a) A corporation which is dissolved nevertheless continues to exist for the purpose of winding up its affairs, prosecuting and defending actions by or against it and enabling it to collect and discharge obligations, dispose of and convey its property and collect and divide its assets, but not for the purpose of continuing its activities except so far as necessary for the winding up thereof. (b) No action or proceeding to which a corporation is a party abates by the dissolution of the corporation or by reason of proceedings for winding up and dissolution thereof. (c) Any assets inadvertently or otherwise omitted from the winding up continue in the dissolved corporation for the benefit of the persons entitled thereto upon dissolution of the corporation and on realization shall be distributed accordingly. (Added by Stats. 1978, Ch. 567.)
  77. 6721.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 17. General Provisions Relating to Dissolution [6710 - 6721] ( Chapter 17 added by Stats. 1978, Ch. 567. )

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    After dissolution, claims can be brought against people who received distributed assets, and service of process may be made by specified methods including substitute service through the Secretary of State if needed.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 17. General Provisions Relating to Dissolution [6710 - 6721] ( Chapter 17 added by Stats. 1978, Ch. 567. ) ## 6721. (a) In all cases where a corporation has been dissolved, any person to whom assets were distributed upon dissolution may be sued in the corporate name upon any cause of action against the corporation arising prior to its dissolution. Notice of such action shall be given to the Attorney General who may intervene. This section is procedural in nature and is not intended to determine liability. (b) Summons or other process against such a corporation may be served by delivering a copy thereof to an officer, director or person having charge of its assets or, if no such person can be found, to any agent upon whom process might be served at the time of dissolution. If none of such persons can be found with due diligence and it is so shown by affidavit to the satisfaction of the court, then the court may make an order that summons or other process be served upon the dissolved corporation by personally delivering a copy thereof, together with a copy of the order, to the Secretary of State or an assistant or deputy secretary of state. Service in this manner is deemed complete on the 10th day after the delivery of process to the Secretary of State. A copy of any summons or other process shall be served on the Attorney General. (c) Every such corporation shall survive and continue to exist indefinitely for the purpose of being sued in any quiet title action. Any judgment rendered in any such action shall bind each and every person having an interest in such corporation, to the extent of their interest therein, and such action shall have the same force and effect as an action brought under the provisions of Sections 410.50 and 410.60 of the Code of Civil Procedure. Service of summons or other process in any such action may be made as provided in Chapter 4 (commencing with Section 413.10) of Title 5 of Part 2 of the Code of Civil Procedure or as provided in subdivision (b). (d) Upon receipt of such process and the fee therefor, the Secretary of State forthwith shall give notice to the corporation as provided in Section 1702. (Amended by Stats. 1979, Ch. 724.)
  78. 6810.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 18. Crimes and Penalties [6810 - 6815] ( Chapter 18 added by Stats. 1978, Ch. 567. )

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    If a corporation misses the Section 6210 filing, the Secretary of State must send a delinquency notice and, after 60 days without filing, certify the corporation to the Franchise Tax Board, which then assesses a $50 penalty unless an exception applies.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 18. Crimes and Penalties [6810 - 6815] ( Chapter 18 added by Stats. 1978, Ch. 567. ) ## 6810. (a) Upon the failure of a corporation to file the statement required by Section 6210, 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, and 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 delinquency has been provided by the Secretary of State. If, within 60 days after providing the notice of delinquency, a statement pursuant to Section 6210 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 a penalty of fifty dollars ($50) pursuant to 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 the corporate powers, rights, and privileges of which 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 6210. The Secretary of State need not provide notice of the filing requirement pursuant to Section 6210 to a corporation the corporate powers, rights, and privileges of which 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 the required statement was filed before the expiration of the 60-day period after providing notice of the delinquency, 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 a statement required by Section 6210 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. (Amended by Stats. 2014, Ch. 834, Sec. 14. (SB 1041) Effective January 1, 2015.)
  79. 6811.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 18. Crimes and Penalties [6810 - 6815] ( Chapter 18 added by Stats. 1978, Ch. 567. )

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    A corporate director who knowingly and fraudulently joins a vote or act to make a distribution meant to defraud creditors, members, or the corporation commits a crime.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 18. Crimes and Penalties [6810 - 6815] ( Chapter 18 added by Stats. 1978, Ch. 567. ) ## 6811. Any director of any corporation 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 distribution with the design of defrauding creditors, members, or the corporation, is guilty of a crime. Each such crime is punishable by imprisonment pursuant to subdivision (h) of Section 1170 of the Penal Code or by a fine of not more than one thousand dollars ($1,000) or imprisonment in a county jail for not more than one year, or both that fine and imprisonment. (Amended by Stats. 2011, Ch. 15, Sec. 40. (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.)
  80. 6812.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 18. Crimes and Penalties [6810 - 6815] ( Chapter 18 added by Stats. 1978, Ch. 567. )

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    Directors or officers of a corporation commit a crime if they knowingly publish materially false or fraudulently exaggerated reports, or if they refuse to make required book entries or notices.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 18. Crimes and Penalties [6810 - 6815] ( Chapter 18 added by Stats. 1978, Ch. 567. ) ## 6812. (a) Every director or officer of any corporation is guilty of a crime if such director or officer knowingly concurs in making or publishing, either generally or privately, to members or other persons (1) any materially false report or statement as to the financial condition of the corporation, or (2) any willfully or fraudulently exaggerated report, account or statement of operations or financial condition, intended to induce and having a tendency to induce, contributions or donations to the corporation by members or other persons. (b) Every director or officer of any corporation is guilty of a crime who refuses to make or direct to be made any book entry or the posting of any notice required by law in the manner required by law. (c) A violation of subdivision (a) or (b) of this section shall be punishable by imprisonment in state prison or by a fine of not more than one thousand dollars ($1,000) or imprisonment in the county jail for not more than one year or both such fine and imprisonment. (Added by Stats. 1978, Ch. 567.)
  81. 6813.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 18. Crimes and Penalties [6810 - 6815] ( Chapter 18 added by Stats. 1978, Ch. 567. )

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    Certain corporate insiders must make truthful book entries and must not falsify or omit material records, especially when acting with intent to defraud.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 18. Crimes and Penalties [6810 - 6815] ( Chapter 18 added by Stats. 1978, Ch. 567. ) ## 6813. (a) Every director, officer or agent of any corporation, 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 crime. (b) Every director, officer, agent or member of any corporation 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 crime. (c) Each crime specified in this section is punishable by imprisonment in state prison, or by imprisonment in a county jail for not exceeding one year, or a fine not exceeding one thousand dollars ($1,000), or by both such fine and imprisonment. (Added by Stats. 1978, Ch. 567.)
  82. 6814.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 18. Crimes and Penalties [6810 - 6815] ( Chapter 18 added by Stats. 1978, Ch. 567. )

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    Certain corporate directors, officers, agents, and people organizing a corporation must not knowingly show false, forged, or altered documents to authorized public officers or boards to deceive them.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 18. Crimes and Penalties [6810 - 6815] ( Chapter 18 added by Stats. 1978, Ch. 567. ) ## 6814. Every director, officer or agent of any corporation, or any person proposing to organize such a 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, 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 more than one year. (Amended by Stats. 2011, Ch. 15, Sec. 41. (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.)
  83. 6815.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 18. Crimes and Penalties [6810 - 6815] ( Chapter 18 added by Stats. 1978, Ch. 567. )

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    This section says the chapter does not restrict the state’s power to punish conduct that is already a crime under another statute.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 18. Crimes and Penalties [6810 - 6815] ( Chapter 18 added by Stats. 1978, Ch. 567. ) ## 6815. Nothing in this chapter limits the power of the state to punish any person for any conduct which constitutes a crime under any other statute. (Added by Stats. 1978, Ch. 567.)
  84. 6910.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 19. Foreign Corporations [6910- 6910.] ( Chapter 19 added by Stats. 1978, Ch. 567. )

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    Foreign corporations doing intrastate business must comply with Chapter 21 of Division 1, with stated exceptions.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 2. NONPROFIT PUBLIC BENEFIT CORPORATIONS [5110 - 6910] ( Part 2 added by Stats. 1978, Ch. 567. ) ## CHAPTER 19. Foreign Corporations [6910- 6910.] ( Chapter 19 added by Stats. 1978, Ch. 567. ) ## 6910. Foreign corporations transacting intrastate business shall comply with Chapter 21 (commencing with Section 2100) of Division 1, except as to matters specifically otherwise provided for in this part and except that Section 2115 shall not be applicable. (Amended by Stats. 1997, Ch. 187, Sec. 8. Effective January 1, 1998.)
  85. 7.

    ## Corporations Code - CORP ## GENERAL PROVISIONS ( General Provisions enacted by Stats. 1947, Ch. 1038. )

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    A deputy or legally authorized person may exercise a public officer’s power or perform the officer’s duty, unless the code says otherwise.

    ## Corporations Code - CORP ## GENERAL PROVISIONS ( General Provisions enacted by Stats. 1947, Ch. 1038. ) ## 7. Whenever, by the provisions of this code, a power is granted to, or a duty imposed upon, a public officer, the power may be exercised or the duty performed by a deputy of the officer or by a person authorized, pursuant to law, by the officer, unless this code expressly provides otherwise. (Enacted by Stats. 1947, Ch. 1038.)
  86. 700.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 7. Voting of Shares [700 - 711] ( Chapter 7 added by Stats. 1975, Ch. 682. )

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    Each outstanding share generally gets one vote on shareholder matters, unless Section 708 or the articles provide otherwise. A voting shareholder may also split votes among shares, except for elections to office.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 7. Voting of Shares [700 - 711] ( Chapter 7 added by Stats. 1975, Ch. 682. ) ## 700. (a) Except as provided in Section 708 and except as may be otherwise provided in the articles, each outstanding share, regardless of class, shall be entitled to one vote on each matter submitted to a vote of shareholders. (b) Any holder of shares entitled to vote on any matter may vote part of the shares in favor of the proposal and refrain from voting the remaining shares or vote them against the proposal, other than elections to office, but, if the shareholder fails to specify the number of shares such shareholder is voting affirmatively, it will be conclusively presumed that the shareholder’s approving vote is with respect to all shares such shareholder is entitled to vote. (Added by Stats. 1975, Ch. 682.)
  87. 701.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 7. Voting of Shares [700 - 711] ( Chapter 7 added by Stats. 1975, Ch. 682. )

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    The board may set a record date to decide which shareholders get notice, can vote, or can receive dividends, distributions, or rights. If no record date is set, the section gives default dates, and the board must set a new record date if an adjourned meeting is delayed more than 45 days.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 7. Voting of Shares [700 - 711] ( Chapter 7 added by Stats. 1975, Ch. 682. ) ## 701. (a) In order that the corporation may determine the shareholders entitled to notice of any meeting or to vote or entitled to receive payment of any dividend or other distribution or allotment of any rights or entitled to exercise any rights in respect of any other lawful action, the board may fix, in advance, a record date, which shall not be more than 60 nor less than 10 days prior to the date of such meeting nor more than 60 days prior to any other action. (b) If no record date is fixed: (1) The record date for determining shareholders entitled to notice of or to vote at a meeting of shareholders shall be at the close of business on the business day next preceding the day on which notice is given or, if notice is waived, at the close of business on the business day next preceding the day on which the meeting is held. (2) The record date for determining shareholders entitled to give consent to corporate action in writing without a meeting, when no prior action by the board has been taken, shall be the day on which the first written consent is given. (3) The record date for determining shareholders for any other purpose shall be at the close of business on the day on which the board adopts the resolution relating thereto, or the 60th day prior to the date of such other action, whichever is later. (c) A determination of shareholders of record entitled to notice of or to vote at a meeting of shareholders shall apply to any adjournment of the meeting unless the board fixes a new record date for the adjourned meeting, but the board shall fix a new record date if the meeting is adjourned for more than 45 days from the date set for the original meeting. (d) Shareholders at the close of business on the record date are entitled to notice and to vote or to receive the dividend, distribution or allotment of rights or to exercise the rights, as the case may be, notwithstanding any transfer of any shares on the books of the corporation after the record date, except as otherwise provided in the articles or by agreement or in this division. (Amended by Stats. 1977, Ch. 235.)
  88. 702.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 7. Voting of Shares [700 - 711] ( Chapter 7 added by Stats. 1975, Ch. 682. )

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    Section 702 says who may vote shares in special holding situations, including trustees, receivers, pledged shares, minors, and attorneys in fact.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 7. Voting of Shares [700 - 711] ( Chapter 7 added by Stats. 1975, Ch. 682. ) ## 702. (a) Subject to subdivision (c) of Section 703, shares held by an administrator, executor, guardian, conservator or custodian may be voted by such holder either in person or by proxy, without a transfer of such shares into the holder’s name; and shares standing in the name of a trustee may be voted by the trustee, either in person or by proxy, but no trustee shall be entitled to vote shares held by such trustee without a transfer of such shares into the trustee’s name. (b) Shares standing in the name of a receiver may be voted by such receiver; and shares held by or under the control of a receiver may be voted by such receiver without the transfer thereof into the receiver’s name if authority to do so is contained in the order of the court by which such receiver was appointed. (c) Subject to the provisions of Section 705 and except where otherwise agreed in writing between the parties, a shareholder whose shares are pledged shall be entitled to vote such shares until the shares have been transferred into the name of the pledgee, and thereafter the pledgee shall be entitled to vote the shares so transferred. (d) Shares standing in the name of a minor may be voted and the corporation may treat all rights incident thereto as exercisable by the minor, in person or by proxy, whether or not the corporation has notice, actual or constructive, of the nonage, unless a guardian of the minor’s property has been appointed and written notice of such appointment given to the corporation. (e) If authorized to vote the shares by the power of attorney by which the attorney in fact was appointed, shares held by or under the control of an attorney in fact may be voted and the corporation may treat all rights incident thereto as exercisable by the attorney in fact, in person or by proxy, without the transfer of the shares into the name of the attorney in fact. (Amended by Stats. 1985, Ch. 403, Sec. 13.)
  89. 703.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 7. Voting of Shares [700 - 711] ( Chapter 7 added by Stats. 1975, Ch. 682. )

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    Certain corporate shares may be voted only by specified corporate officers or authorized persons, and some subsidiary or fiduciary-held shares cannot vote except in limited cases.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 7. Voting of Shares [700 - 711] ( Chapter 7 added by Stats. 1975, Ch. 682. ) ## 703. (a) Shares standing in the name of another corporation, domestic or foreign, may be voted by an officer, agent, or proxyholder as the bylaws of the other corporation may prescribe or, in the absence of such provision, as the board of the other corporation may determine or, in the absence of that determination, by the chairperson of the board, president or any vice president of the other corporation, or by any other person authorized to do so by the chairperson of the board, president, or any vice president of the other corporation. Shares which are purported to be voted or any proxy purported to be executed in the name of a corporation (whether or not any title of the person signing is indicated) shall be presumed to be voted or the proxy executed in accordance with the provisions of this subdivision, unless the contrary is shown. (b) Shares of a corporation owned by its subsidiary shall not be entitled to vote on any matter. (c) Shares held by the issuing corporation in a fiduciary capacity, and shares of an issuing corporation held in a fiduciary capacity by its subsidiary, shall not be entitled to vote on any matter, except as follows: (1) To the extent that the settlor or beneficial owner possesses and exercises a right to vote or to give the corporation binding instructions as to how to vote such shares. (2) Where there are one or more cotrustees who are not affected by the prohibition of this subdivision, in which case the shares may be voted by the cotrustees as if it or they are the sole trustee. (Amended by Stats. 2015, Ch. 98, Sec. 8. (SB 351) Effective January 1, 2016.)
  90. 704.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 7. Voting of Shares [700 - 711] ( Chapter 7 added by Stats. 1975, Ch. 682. )

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    When shares are registered in the names of two or more persons, their voting acts are treated in a set way unless the corporation’s secretary gets written notice and the relevant instrument or order says otherwise.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 7. Voting of Shares [700 - 711] ( Chapter 7 added by Stats. 1975, Ch. 682. ) ## 704. (a) If shares stand of record in the names of two or more persons, whether fiduciaries, members of a partnership, joint tenants, tenants in common, spouses as community property, tenants by the entirety, voting trustees, persons entitled to vote under a shareholder voting agreement or otherwise, or if two or more persons (including proxyholders) have the same fiduciary relationship respecting the same shares, unless the secretary of the corporation is given written notice to the contrary and is furnished with a copy of the instrument or order appointing them or creating the relationship wherein it is so provided, their acts with respect to voting shall have the following effect: (1) If only one votes, such act binds all. (2) If more than one vote, the act of the majority so voting binds all. (3) If more than one vote, but the vote is evenly split on any particular matter, each faction may vote the securities in question proportionately. (b) If the instrument so filed or the registration of the shares shows that any such tenancy is held in unequal interests, a majority or even split for the purpose of this section shall be a majority or even split in interest. (Amended by Stats. 2016, Ch. 50, Sec. 21. (SB 1005) Effective January 1, 2017.)
  91. 705.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 7. Voting of Shares [700 - 711] ( Chapter 7 added by Stats. 1975, Ch. 682. )

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    A shareholder entitled to vote may authorize a proxy, and a recordholder must issue a proxy to the pledgor or owner on demand and payment of necessary expenses in the stated circumstances.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 7. Voting of Shares [700 - 711] ( Chapter 7 added by Stats. 1975, Ch. 682. ) ## 705. (a) Every person entitled to vote shares may authorize another person or persons to act by proxy with respect to such shares. Any proxy purporting to be executed in accordance with the provisions of this division shall be presumptively valid. (b) No proxy shall be valid after the expiration of 11 months from the date thereof unless otherwise provided in the proxy. Every proxy continues in full force and effect until revoked by the person executing it prior to the vote pursuant thereto, except as otherwise provided in this section. Such revocation may be effected by a writing delivered to the corporation stating that the proxy is revoked or by a subsequent proxy executed by the person executing the prior proxy and presented to the meeting, or as to any meeting by attendance at such meeting and voting in person by the person executing the proxy. The dates contained on the forms of proxy presumptively determine the order of execution, regardless of the postmark dates on the envelopes in which they are mailed. (c) A proxy is not revoked by the death or incapacity of the maker unless, before the vote is counted, written notice of such death or incapacity is received by the corporation. (d) Except when other provision shall have been made by written agreement between the parties, the recordholder of shares which such person holds as pledgee or otherwise as security or which belong to another shall issue to the pledgor or to the owner of such shares, upon demand therefor and payment of necessary expenses thereof, a proxy to vote or take other action thereon. (e) A proxy which states that it is irrevocable is irrevocable for the period specified therein (notwithstanding subdivision (c)) when it is held by any of the following or a nominee of any of the following: (1) A pledgee. (2) A person who has purchased or agreed to purchase or holds an option to purchase the shares or a person who has sold a portion of such person’s shares in the corporation to the maker of the proxy. (3) A creditor or creditors of the corporation or the shareholder who extended or continued credit to the corporation or the shareholder in consideration of the proxy if the proxy states that it was given in consideration of such extension or continuation of credit and the name of the person extending or continuing credit. (4) A person who has contracted to perform services as an employee of the corporation, if a proxy is required by the contract of employment and if the proxy states that it was given in consideration of such contract of employment, the name of the employee and the period of employment contracted for. (5) A person designated by or under an agreement under Section 706. (6) A beneficiary of a trust with respect to shares held by the trust. Notwithstanding the period of irrevocability specified, the proxy becomes revocable when the pledge is redeemed, the option or agreement to purchase is terminated or the seller no longer owns any shares of the corporation or dies, the debt of the corporation or the shareholder is paid, the period of employment provided for in the contract of employment has terminated, the agreement under Section 706 has terminated, or the person ceases to be a beneficiary of the trust. In addition to the foregoing clauses (1) through (5), a proxy may be made irrevocable (notwithstanding subdivision (c)) if it is given to secure the performance of a duty or to protect a title, either legal or equitable, until the happening of events which, by its terms, discharge the obligations secured by it. (f) A proxy may be revoked, notwithstanding a provision making it irrevocable, by a transferee of shares without knowledge of the existence of the provision unless the existence of the proxy and its irrevocability appears, in the case of certificated securities, on the certificate representing such shares, or in the case of uncertificated securities, on the initial transaction statement and written statements. (Amended by Stats. 1986, Ch. 766, Sec. 22.)
  92. 706.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 7. Voting of Shares [700 - 711] ( Chapter 7 added by Stats. 1975, Ch. 682. )

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    Shareholder voting agreements may control how shares are voted, and voting trust agreements may let trustees vote and represent shares for a limited period.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 7. Voting of Shares [700 - 711] ( Chapter 7 added by Stats. 1975, Ch. 682. ) ## 706. (a) Notwithstanding any other provision of this division, an agreement between two or more shareholders of a corporation, if in writing and signed by the parties thereto, may provide that in exercising any voting rights the shares held by them shall be voted as provided by the agreement, or as the parties may agree or as determined in accordance with a procedure agreed upon by them, and the parties may but need not transfer the shares covered by such an agreement to a third party or parties with authority to vote them in accordance with the terms of the agreement. Such an agreement shall not be denied specific performance by a court on the ground that the remedy at law is adequate or on other grounds relating to the jurisdiction of a court of equity. (b) Shares in any corporation may be transferred by written agreement to trustees in order to confer upon them the right to vote and otherwise represent the shares for such period of time, not exceeding 10 years, as may be specified in the agreement. The validity of a voting trust agreement, otherwise lawful, shall not be affected during a period of 10 years from the date when it was created or last extended as hereinafter provided by the fact that under its terms it will or may last beyond such 10-year period. At any time within two years prior to the time of expiration of any voting trust agreement as originally fixed or as last extended as provided in this subdivision, one or more beneficiaries under the voting trust agreement may, by written agreement and with the written consent of the voting trustee or trustees, extend the duration of the voting trust agreement with respect to their shares for an additional period not exceeding 10 years from the expiration date of the trust as originally fixed or as last extended as provided in this subdivision. A duplicate of the voting trust agreement and any extension thereof shall be filed with the secretary of the corporation and shall be open to inspection by a shareholder, a holder of a voting trust certificate or the agent of either, upon the same terms as the record of shareholders of the corporation is open to inspection. (c) No agreement made pursuant to subdivision (a) shall be held to be invalid or unenforceable on the ground that it is a voting trust that does not comply with subdivision (b) or that it is a proxy that does not comply with Section 705. (d) This section shall not invalidate any voting or other agreement among shareholders or any irrevocable proxy complying with subdivision (e) of Section 705, which agreement or proxy is not otherwise illegal. (Amended by Stats. 1997, Ch. 136, Sec. 3. Effective January 1, 1998.)
  93. 707.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 7. Voting of Shares [700 - 711] ( Chapter 7 added by Stats. 1975, Ch. 682. )

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    This section lets the board or, in some cases, the meeting chair appoint election inspectors for shareholder meetings, and requires the inspectors to carry out specified vote-related tasks fairly and diligently.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 7. Voting of Shares [700 - 711] ( Chapter 7 added by Stats. 1975, Ch. 682. ) ## 707. (a) In advance of any meeting of shareholders the board may appoint inspectors of election to act at the meeting and any adjournment thereof. If inspectors of election are not so appointed, or if any persons so appointed fail to appear or refuse to act, the chairperson of any meeting of shareholders may, and on the request of any shareholder or a shareholder’s proxy shall, appoint inspectors of election (or persons to replace those who so fail or refuse) at the meeting. The number of inspectors shall be either one or three. If appointed at a meeting on the request of one or more shareholders or proxies, the majority of shares represented in person or by proxy shall determine whether one or three inspectors are to be appointed. (b) The inspectors of election shall determine the number of shares outstanding and the voting power of each, the shares represented at the meeting, the existence of a quorum and the authenticity, validity and effect of proxies, receive votes, ballots or consents, hear and determine all challenges and questions in any way arising in connection with the right to vote, count and tabulate all votes or consents, determine when the polls shall close, determine the result and do such acts as may be proper to conduct the election or vote with fairness to all shareholders. (c) The inspectors of election shall perform their duties impartially, in good faith, to the best of their ability and as expeditiously as is practical. If there are three inspectors of election, the decision, act or certificate of a majority is effective in all respects as the decision, act or certificate of all. Any report or certificate made by the inspectors of election is prima facie evidence of the facts stated therein. (Amended by Stats. 2022, Ch. 617, Sec. 16. (SB 1202) Effective January 1, 2023.)
  94. 708.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 7. Voting of Shares [700 - 711] ( Chapter 7 added by Stats. 1975, Ch. 682. )

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    Shareholders may cumulate votes for director elections if they meet the stated notice and nomination conditions, and some mutual water company shareholders are covered too.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 7. Voting of Shares [700 - 711] ( Chapter 7 added by Stats. 1975, Ch. 682. ) ## 708. (a) Except as provided in Sections 301.5 and 708.5, every shareholder complying with subdivision (b) and entitled to vote at any election of directors may cumulate such shareholder’s votes and give one candidate a number of votes equal to the number of directors to be elected multiplied by the number of votes to which the shareholder’s shares are normally entitled, or distribute the shareholder’s votes on the same principle among as many candidates as the shareholder thinks fit. (b) No shareholder shall be entitled to cumulate votes (i.e., cast for any candidate a number of votes greater than the number of votes that the shareholder normally is entitled to cast) unless the candidate or candidates’ names have been placed in nomination prior to the voting and the shareholder has given notice at the meeting prior to the voting of the shareholder’s intention to cumulate the shareholder’s votes. If any one shareholder has given that notice, all shareholders may cumulate their votes for candidates in nomination. (c) Except as provided in Section 708.5, in any election of directors, the candidates receiving the highest number of affirmative votes of the shares entitled to be voted for them up to the number of directors to be elected by those shares are elected; votes against the director and votes withheld shall have no legal effect. (d) Subdivision (a) applies to the shareholders of any mutual water company organized or existing for the purpose of delivering water to its shareholders at cost on lands located within the boundaries of one or more reclamation districts now or hereafter legally existing in this state and created by or formed under the provisions of any statute of this state, but does not otherwise apply to the shareholders of mutual water companies unless their articles or bylaws so provide. (e) Elections for directors need not be by ballot unless a shareholder demands election by ballot at the meeting and before the voting begins or unless the bylaws so require. (Amended by Stats. 2006, Ch. 871, Sec. 1. Effective January 1, 2007.)
  95. 708.5.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 7. Voting of Shares [700 - 711] ( Chapter 7 added by Stats. 1975, Ch. 682. )

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    This section defines “uncontested election” and “listed corporation,” and lets certain listed corporations require shareholder approval to elect a director in an uncontested election.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 7. Voting of Shares [700 - 711] ( Chapter 7 added by Stats. 1975, Ch. 682. ) ## 708.5. (a) For purposes of this section,the following definitions shall apply: (1) “Uncontested election” means an election of directors in which, at the expiration of the time fixed under the articles of incorporation or bylaws requiring advance notification of director candidates or, absent such a provision in the articles of incorporation or bylaws, at a time fixed by the board of directors that is not more than 14 days before notice is given of the meeting at which the election is to occur, the number of candidates for election does not exceed the number of directors to be elected by the shareholders at that election. (2) “Listed corporation” means a domestic corporation that qualifies as a listed corporation under subdivision (d) of Section 301.5. (b) Notwithstanding paragraph (5) of subdivision (a) of Section 204, a listed corporation that has eliminated cumulative voting pursuant to subdivision (a) of Section 301.5 may amend its articles of incorporation or bylaws to provide that, in an uncontested election, approval of the shareholders, as specified in Section 153, shall be required to elect a director. (c) Notwithstanding subdivision (b) of Section 301, if an incumbent director fails to be elected by approval of the shareholders (Section 153) in an uncontested election of a listed corporation that has amended its articles of incorporation or bylaws pursuant to subdivision (b), then, unless the incumbent director has earlier resigned, the term of the incumbent director shall end on the date that is the earlier of 90 days after the date on which the voting results are determined pursuant to Section 707 or the date on which the board of directors selects a person to fill the office held by that director pursuant to subdivision (d). (d) Any vacancy on the board of directors resulting from any failure of a candidate to be elected by approval of the shareholders (Section 153) in an uncontested election of a listed corporation that has amended its articles of incorporation or bylaws pursuant to subdivision (b) shall be filled in accordance with the procedures set forth in Section 305. (Added by Stats. 2006, Ch. 871, Sec. 2. Effective January 1, 2007.)
  96. 709.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 7. Voting of Shares [700 - 711] ( Chapter 7 added by Stats. 1975, Ch. 682. )

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    A shareholder, or someone denied the right to vote, may file an action asking the superior court to decide whether a director election or appointment is valid.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 7. Voting of Shares [700 - 711] ( Chapter 7 added by Stats. 1975, Ch. 682. ) ## 709. (a) Upon the filing of an action therefor by any shareholder or by any person who claims to have been denied the right to vote, the superior court of the proper county shall try and determine the validity of any election or appointment of any director of any domestic corporation, or of any foreign corporation if the election was held or the appointment was made in this state. In the case of a foreign corporation the action may be brought at the option of the plaintiff in the county in which the corporation has its principal office in California or in the county in which the election was held or the appointment was made. (b) Upon the filing of the complaint, and before any further proceedings are had, the court shall enter an order fixing a date for the hearing, which shall be within five days unless for good cause shown a later date is fixed, and requiring notice of the date for the hearing and a copy of the complaint to be served upon the corporation and upon the person whose purported election or appointment is questioned and upon any person (other than the plaintiff) whom the plaintiff alleges to have been elected or appointed, in the manner in which a summons is required to be served, or, if the court so directs, by registered mail; and the court may make such further requirements as to notice as appear to be proper under the circumstances. (c) The court may determine the person entitled to the office of director or may order a new election to be held or appointment to be made, may determine the validity, effectiveness and construction of voting agreements and voting trusts, the validity of the issuance of shares and the right of persons to vote and may direct such other relief as may be just and proper. (Amended by Stats. 2022, Ch. 617, Sec. 17. (SB 1202) Effective January 1, 2023.)
  97. 710.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 7. Voting of Shares [700 - 711] ( Chapter 7 added by Stats. 1975, Ch. 682. )

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    This section limits supermajority voting rules in certain corporation articles or certificates and sets when the section applies or does not apply.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 7. Voting of Shares [700 - 711] ( Chapter 7 added by Stats. 1975, Ch. 682. ) ## 710. (a) This section applies to a corporation with outstanding shares held of record by 100 or more persons (determined as provided in Section 605) that files an amendment of articles or certificate of determination containing a “supermajority vote” provision on or after January 1, 1989. This section shall not apply to a corporation that files an amendment of articles or certificate of determination on or after January 1, 1994, if, at the time of filing, the corporation has (1) outstanding shares of more than one class or series of stock, (2) no class of equity securities registered under Section 12(b) or 12(g) of the Securities Exchange Act of 1934, and (3) outstanding shares held of record by fewer than 300 persons determined as provided by Section 605. (b) A “supermajority vote” is a requirement set forth in the articles or in a certificate of determination authorized under any provision of this division that specified corporate action or actions be approved by a larger proportion of the outstanding shares than a majority, or by a larger proportion of the outstanding shares of a class or series than a majority, but no supermajority vote that is subject to this section shall require a vote in excess of 662/3 percent of the outstanding shares or 662/3 percent of the outstanding shares of any class or series of those shares. (c) An amendment of the articles or a certificate of determination that includes a supermajority vote requirement shall be approved by at least as large a proportion of the outstanding shares (Section 152) as is required pursuant to that amendment or certificate of determination for the approval of the specified corporate action or actions. (d) The amendments made to this section by the act amending this section in the 2001–02 Regular Session shall not affect the rights of minority shareholders existing under law. (Amended by Stats. 2006, Ch. 57, Sec. 2. Effective January 1, 2007.)
  98. 711.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 7. Voting of Shares [700 - 711] ( Chapter 7 added by Stats. 1975, Ch. 682. )

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    People with the power to vote shares for another must keep voting records, disclose them on reasonable written request, and may be able to charge a reasonable disclosure fee.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 1. GENERAL CORPORATION LAW [100 - 2319] ( Division 1 repealed and added by Stats. 1975, Ch. 682. ) ## CHAPTER 7. Voting of Shares [700 - 711] ( Chapter 7 added by Stats. 1975, Ch. 682. ) ## 711. (a) The Legislature finds and declares that: Many of the residents of this state are the legal and beneficial owners or otherwise the ultimate beneficiaries of shares of stock of domestic and foreign corporations, title to which may be held by a variety of intermediate owners as defined in subdivision (b). The informed and active involvement of such beneficial owners and beneficiaries in holding legal owners and, through them, management, accountable in their exercise of corporate power is essential to the interest of those beneficiaries and beneficial owners and to the economy and well-being of this state. The purpose of this section is to serve the public interest by ensuring that voting records are maintained and disclosed as provided in this section. In the event that by statute or regulation pursuant to the federal Employee Retirement Income Security Act of 1974 (29 U.S.C. Sec. 1001 et seq.), there are imposed upon investment managers as defined in Sec. 2(38) thereof, duties substantially the same as those set forth in this section, compliance with those statutory or regulatory requirements by persons subject to this section shall be deemed to fulfill the obligations contained in this section. This section shall be construed liberally to achieve that purpose. (b) For purposes of this section, a person on whose behalf shares are voted includes, but is not limited to: (1) A participant or beneficiary of an employee benefit plan with regard to shares held for the benefit of the participant or beneficiary. (2) A shareholder, beneficiary, or contract owner of any entity (or of any portfolio of any entity) as defined in Section 3(a) of the federal Investment Company Act of 1940 (15 U.S.C. Sec. 80a-1 et seq.), as amended, to the extent the entity (or portfolio) holds the shares for which the record is requested. (c) For the purposes of this section, a person on whose behalf shares are voted does not include: (1) A person who possesses the right to terminate or withdraw from the shareholder, contract owner, participant, or beneficiary relationship with any entity (or any portfolio of any entity) defined in subdivision (b). This exclusion does not apply in the event the right of termination or withdrawal cannot be exercised without automatic imposition of a tax penalty. The right to substitute a relationship with an entity or portfolio, the shares of which are voted by or subject to the direction of the investment adviser (as defined in Section 2 of the federal Investment Company Act of 1940 (15 U.S.C. Sec. 80a-1 et seq.), as amended), of the prior entity or portfolio, or an affiliate of the investment adviser, shall not be deemed to be a right of termination or withdrawal within the meaning of this subdivision. (2) A person entitled to receive information about a trust pursuant to Section 16061 of the Probate Code. (3) A beneficiary, participant, contract owner, or shareholder whose interest is funded through the general assets of a life insurance company authorized to conduct business in this state. (d) Every person possessing the power to vote shares of stock on behalf of another shall maintain a record of the manner in which the shares were voted. The record shall be maintained for a period of 12 consecutive months from the effective date of the vote. (e) Upon a reasonable written request, the person possessing the power to vote shares of stock on behalf of another, or a designated agent, shall disclose the voting record with respect to any matter involving a specific security or securities in accordance with the following procedures: (1) Except as set forth in paragraph (2), disclosure shall be made to the person making the request. The person making the disclosure may require identification sufficient to identify the person making the request as a person on whose behalf the shares were voted. A request for identification, if made, shall be reasonable, shall be made promptly, and may include a request for the person’s social security number. (2) If the person possessing the power to vote shares on behalf of another holds that power pursuant to an agreement entered into with a party other than the person making the request for disclosure, the person maintaining and disclosing the record pursuant to this section may, instead, make the requested disclosure to that party. Disclosure to that party shall be deemed compliance with the disclosure requirement of this section. If disclosure is made to that party and not to the person making the request, subdivision (i) shall not apply. However, nothing herein shall prohibit that party and the person possessing the power to vote on shares from entering into an agreement between themselves for the payment or assessment of a reasonable charge to defray expenses of disclosing the record. (f) Where the entity subject to the requirements of this section is organized as a unit investment trust as defined in Section 4(2) of the federal Investment Company Act of 1940 (15 U.S.C. Sec. 80a-1 et seq.), the open-ended investment companies underlying the unit investment trust shall promptly make available their proxy voting records to the unit investment trust upon evidence of a bona fide request for voting record information pursuant to subdivision (e). (g) Signing a proxy on another’s behalf and forwarding it for disposition or receiving voting instructions does not constitute the power to vote. A person forwarding proxies or receiving voting instructions shall disclose the identity of the person having the power to vote shares upon reasonable written request by a person entitled to request a voting record under subdivision (c). (h) For purposes of this section, if one or more persons has the power to vote shares on behalf of another, unless a governing instrument provides otherwise, the person or persons may designate an agent who shall maintain and disclose the record in accordance with subdivisions (b) and (c). (i) Except as provided in paragraph (2) of subdivision (e), or as otherwise provided by law or a governing instrument, a person maintaining and disclosing a record pursuant to this section may assess a reasonable charge to the requesting person in order to defray expenses of disclosing the record in accordance with subdivision (e). Disclosure shall be made within a reasonable period after payment is received. (j) Upon the petition of any person who successfully brings an action pursuant to or to enforce this section, the court may award costs and reasonable attorney’s fees if the court finds that the defendant willfully violated this section. (k) The obligation to maintain and disclose a voting record in accordance with subdivisions (b) and (c) shall commence January 1, 1990. (Added by Stats. 1988, Ch. 1360, Sec. 1.)
  99. 7110.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Title and Purposes [7110 - 7111] ( Article 1 added by Stats. 1978, Ch. 567. )

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    This section says the part is known as the Nonprofit Mutual Benefit Corporation Law and may be cited by that name.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Title and Purposes [7110 - 7111] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 7110. This part shall be known and may be cited as the Nonprofit Mutual Benefit Corporation Law. (Added by Stats. 1978, Ch. 567.)
  100. 7111.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Title and Purposes [7110 - 7111] ( Article 1 added by Stats. 1978, Ch. 567. )

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    A corporation may be formed under this part for any lawful purpose, unless its assets are permanently dedicated to charitable, religious, or public purposes and it must distribute assets on dissolution to people carrying on those purposes.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Title and Purposes [7110 - 7111] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 7111. Subject to any other provision of law of this state applying to the particular class of corporation or line of activity, a corporation may be formed under this part for any lawful purpose; provided that a corporation all of the assets of which are irrevocably dedicated to charitable, religious, or public purposes and which as a matter of law or according to its articles or bylaws must, upon dissolution, distribute its assets to a person or persons carrying on a charitable, religious, or public purpose or purposes may not be formed under this part. (Amended by Stats. 1981, Ch. 587, Sec. 25.)
  101. 7120.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Formation [7120 - 7122.3] ( Article 2 added by Stats. 1978, Ch. 567. )

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    One or more persons may form a corporation by filing articles of incorporation. If initial directors are named, they must sign and acknowledge the articles; if not, the incorporators must sign them.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Formation [7120 - 7122.3] ( Article 2 added by Stats. 1978, Ch. 567. ) ## 7120. (a) One or more persons may form a corporation under this part by executing and filing articles of incorporation. (b) If initial directors are named in the articles, each director named in the articles shall sign and acknowledge the articles; if initial directors are not named in the articles, the articles shall be signed by one or more persons who thereupon are the incorporators of the corporation. (c) The corporate existence begins upon the filing of the articles and continues perpetually, unless otherwise expressly provided by law or in the articles. (Amended by Stats. 1983, Ch. 1085, Sec. 3.)
  102. 7121.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Formation [7120 - 7122.3] ( Article 2 added by Stats. 1978, Ch. 567. )

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    An existing unincorporated association may convert into a corporation if properly authorized, and the conversion changes property and some member status rules.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Formation [7120 - 7122.3] ( Article 2 added by Stats. 1978, Ch. 567. ) ## 7121. (a) In the case of an existing unincorporated association, the association may change its status to that of a corporation upon a proper authorization for such by the association in accordance with its rules and procedures. (b) In addition to the matters required to be set forth in the articles pursuant to Section 7130, the articles in the case of an incorporation authorized by subdivision (a) shall set forth that an existing unincorporated association, stating its name, is being incorporated by the filing of the articles. (c) The articles filed pursuant to this section shall be accompanied by a verified statement of any two officers or governing board members of the association stating that the incorporation of the association by means of the articles to which the verified statement is attached has been approved by the association in accordance with its rules and procedures. (d) Upon the change of status of an unincorporated association to a corporation pursuant to subdivision (a), the property of the association becomes the property of the corporation and the members of the association who had any voting rights of the type referred to in Section 5056 become members of the corporation. (e) The filing for record in the office of the county recorder of any county in this state in which any of the real property of the association is located, of a copy of the articles of incorporation filed pursuant to this section, certified by the Secretary of State, shall evidence record ownership in the corporation of all interests of the association in and to the real property located in that county. (f) All rights of creditors and all liens upon the property of the association shall be preserved unimpaired. Any action or proceeding pending by or against the unincorporated association may be prosecuted to judgment, which shall bind the corporation, or the corporation may be proceeded against or substituted in its place. (g) If a corporation is organized by a person who is or was an officer, director or member of an unincorporated association and such corporation is not organized pursuant to subdivision (a), the unincorporated association may continue to use its name and the corporation may not use a name which is the same as or similar to the name of the unincorporated association. (Amended by Stats. 1981, Ch. 587, Sec. 26.)
  103. 7122.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Formation [7120 - 7122.3] ( Article 2 added by Stats. 1978, Ch. 567. )

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    The Secretary of State may not file certain articles with prohibited name terms or misleading names, and applicants may reserve a name for 60 days by paying the required fee.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Formation [7120 - 7122.3] ( Article 2 added by Stats. 1978, Ch. 567. ) ## 7122. (a) The Secretary of State shall not file articles setting forth a name in which “bank,” “trust,” “trustee,” or related words appear, unless the certificate of approval of the Commissioner of Financial Protection and Innovation is attached thereto. (b) The Secretary of State shall not file articles pursuant to this part setting forth a name that may create the impression that the purpose of the corporation is public, charitable, or religious or that it is a charitable foundation. (c) The name of a corporation shall not be a name that the Secretary of State determines is likely to mislead the public and shall be distinguishable in the records of the Secretary of State from all of the following: (1) The name of any corporation. (2) The name of any foreign corporation authorized to transact intrastate business in this state. (3) Each name that is under reservation pursuant to this title. (4) The name of a foreign corporation that has registered its name pursuant to Section 2101. (5) An alternate name of a foreign corporation under subdivision (b) of Section 2106. (6) A name that will become the record name of a domestic or foreign corporation upon a corporate instrument when there is a delayed effective or file date. (d) The use by a corporation of a name in violation of this section may be enjoined notwithstanding the filing of its articles by the Secretary of State. (e) Any applicant may, upon payment of the fee prescribed therefor in the Government Code, obtain from the Secretary of State a certificate of reservation of any name not prohibited by subdivision (c), and upon the issuance of the certificate the name stated therein shall be reserved for a period of 60 days. The Secretary of State shall not, however, issue certificates reserving the same name for two or more consecutive 60-day periods to the same applicant or for the use or benefit of the same person; nor shall consecutive reservations be made by or for the use or benefit of the same person of names so similar as to fall within the prohibitions of subdivision (c). (Amended by Stats. 2022, Ch. 617, Sec. 56. (SB 1202) Effective January 1, 2023.)
  104. 7122.3.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Formation [7120 - 7122.3] ( Article 2 added by Stats. 1978, Ch. 567. )

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    The Secretary of State must not file corporate articles if the corporation’s name would fall within certain Financial Code prohibitions, unless the filing is for a corporation organized under a specified Financial Code section.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Formation [7120 - 7122.3] ( Article 2 added by Stats. 1978, Ch. 567. ) ## 7122.3. The Secretary of State shall not file articles for a corporation the name of which would fall within the prohibitions of Section 18104 of the Financial Code. This section shall not apply to articles filed for a corporation organized in accordance with Section 18100 of the Financial Code. (Added by Stats. 1999, Ch. 453, Sec. 10. Effective January 1, 2000.)
  105. 7130.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Articles of Incorporation [7130 - 7135] ( Article 3 added by Stats. 1978, Ch. 567. )

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    Articles of incorporation for a corporation formed under this part must include specified information, including the corporation’s name and required address and purpose statements.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Articles of Incorporation [7130 - 7135] ( Article 3 added by Stats. 1978, Ch. 567. ) ## 7130. The articles of incorporation of a corporation formed under this part shall set forth the following: (a) The name of the corporation. (b) (1) Except as provided in paragraph (2) or (3), the following statement: “This corporation is a nonprofit mutual benefit corporation organized under the Nonprofit Mutual Benefit Corporation Law. The purpose of this corporation is to engage in any lawful act or activity, other than credit union business, for which a corporation may be organized under such law.” (2) In the case of a corporation formed under this part that is subject to the California Credit Union Law (Chapter 1 (commencing with Section 14000) of Division 5 of the Financial Code), the articles shall set forth a statement of purpose that is prescribed in the applicable provisions of the California Credit Union Law. (3) In the case of a corporation formed under this part that is a public bank, as defined in Section 57600 of the Government Code, the articles shall set forth a statement of purpose that is prescribed in subdivision (a) of Section 57601 of the Government Code. (4) The articles may include a further definition of the corporation’s purposes. (c) The name and street address in this state of the corporation’s initial agent for service of process in accordance with subdivision (b) of Section 8210. (d) The initial street address of the corporation. (e) The initial mailing address of the corporation, if different from the initial street address. (Amended by Stats. 2019, Ch. 442, Sec. 3. (AB 857) Effective January 1, 2020.)
  106. 7131.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Articles of Incorporation [7130 - 7135] ( Article 3 added by Stats. 1978, Ch. 567. )

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    The articles of incorporation may include a statement limiting the corporation’s purposes or powers.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Articles of Incorporation [7130 - 7135] ( Article 3 added by Stats. 1978, Ch. 567. ) ## 7131. The articles of incorporation may set forth a further statement limiting the purposes or powers of the corporation. (Added by Stats. 1978, Ch. 567.)
  107. 7132.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Articles of Incorporation [7130 - 7135] ( Article 3 added by Stats. 1978, Ch. 567. )

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    The articles of incorporation may include certain listed provisions, but those provisions are only effective if they are expressly stated in the articles.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Articles of Incorporation [7130 - 7135] ( Article 3 added by Stats. 1978, Ch. 567. ) ## 7132. (a) The articles of incorporation may set forth any or all of the following provisions, which shall not be effective unless expressly provided in the articles: (1) A provision limiting the duration of the corporation’s existence to a specified date. (2) A provision conferring upon the holders of any evidences of indebtedness, issued or to be issued by a corporation the right to vote in the election of directors and on any other matters on which members may vote under this part even if the corporation does not have members. (3) A provision conferring upon members the right to determine the consideration for which memberships shall be issued. (4) In the case of a subordinate corporation instituted or created under the authority of a head organization, a provision setting forth either or both of the following: (A) That the subordinate corporation shall dissolve whenever its charter is surrendered to, taken away by, or revoked by the head organization granting it. (B) That in the event of its dissolution pursuant to an article provision allowed by subparagraph (A) or in the event of its dissolution for any reason, any assets of the corporation after compliance with the applicable provisions of Chapters 15 (commencing with Section 8510), 16 (commencing with Section 8610), and 17 (commencing with Section 8710) shall be distributed to the head organization. (b) Nothing contained in subdivision (a) shall affect the enforceability, as between the parties thereto, of any lawful agreement not otherwise contrary to public policy. (c) The articles of incorporation may set forth any or all of the following provisions: (1) The names and addresses of the persons appointed to act as initial directors. (2) Provisions concerning the transfer of memberships, in accordance with Section 7320. (3) The classes of members, if any, and if there are two or more classes, the rights, privileges, preferences, restrictions and conditions attaching to each class. (4) A provision which would allow any member to have more or less than one vote in any election or other matter presented to the members for a vote. (5) A provision that requires an amendment to the articles, as provided in subdivision (a) of Section 7812, or to the bylaws, and any amendment or repeal of that amendment, to be approved in writing by a specified person or persons other than the board or the members. However, this approval requirement, unless the articles specify otherwise, shall not apply if any of the following circumstances exist: (A) The specified person or persons have died or ceased to exist. (B) If the right of the specified person or persons to approve is in the capacity of an officer, trustee, or other status and the office, trust, or status has ceased to exist. (C) If the corporation has a specific proposal for amendment or repeal, and the corporation has provided written notice of that proposal, including a copy of the proposal, to the specified person or persons at the most recent address for each of them, based on the corporation’s records, and the corporation has not received written approval or nonapproval within the period specified in the notice, which shall not be less than 10 nor more than 30 days commencing at least 20 days after the notice has been provided. (6) Any other provision, not in conflict with law, for the management of the activities and for the conduct of the affairs of the corporation, including any provision which is required or permitted by this part to be stated in the bylaws. (Amended by Stats. 2009, Ch. 631, Sec. 16. (AB 1233) Effective January 1, 2010.)
  108. 7133.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Articles of Incorporation [7130 - 7135] ( Article 3 added by Stats. 1978, Ch. 567. )

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    A Secretary of State–certified copy of a corporation’s articles is conclusive proof the corporation was formed, except in a quo warranto action, and is prima facie proof of corporate existence.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Articles of Incorporation [7130 - 7135] ( Article 3 added by Stats. 1978, Ch. 567. ) ## 7133. For all purposes other than an action in the nature of quo warranto, a copy of the articles of a corporation duly certified by the Secretary of State is conclusive evidence of the formation of the corporation and prima facie evidence of its corporate existence. (Added by Stats. 1978, Ch. 567.)
  109. 7134.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Articles of Incorporation [7130 - 7135] ( Article 3 added by Stats. 1978, Ch. 567. )

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    If the articles do not name initial directors, the incorporator(s) may take necessary steps to organize the corporation until directors are elected.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Articles of Incorporation [7130 - 7135] ( Article 3 added by Stats. 1978, Ch. 567. ) ## 7134. If initial directors have not been named in the articles, the incorporator or incorporators, until the directors are elected, may do whatever is necessary and proper to perfect the organization of the corporation, including the adoption and amendment of bylaws of the corporation and the election of directors and officers. (Added by Stats. 1978, Ch. 567.)
  110. 7135.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Articles of Incorporation [7130 - 7135] ( Article 3 added by Stats. 1978, Ch. 567. )

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    This section says the articles of a mutual benefit corporation cannot be read to limit a court’s equitable power to impose a charitable trust on its assets or treat the corporation as a public benefit corporation.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Articles of Incorporation [7130 - 7135] ( Article 3 added by Stats. 1978, Ch. 567. ) ## 7135. Nothing in Section 7130 or 7131 or in any provision of the articles of a mutual benefit corporation shall be construed to limit the equitable power of a court to impress a charitable trust upon any or all of the assets of a mutual benefit corporation or otherwise treat it as a public benefit corporation. (Added by Stats. 1978, Ch. 567.)
  111. 7140.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 4. Powers [7140 - 7142] ( Article 4 added by Stats. 1978, Ch. 567. )

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    A corporation has broad powers to run its activities, including adopting bylaws, dealing in its own securities, and taking certain emergency actions, subject to limits in its articles, bylaws, and other applicable law.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 4. Powers [7140 - 7142] ( Article 4 added by Stats. 1978, Ch. 567. ) ## 7140. Subject to any limitations contained in the articles or bylaws and to compliance with other provisions of this division and any other applicable laws, a corporation, in carrying out its activities, shall have all of the powers of a natural person, including, without limitation, the power to: (a) Adopt, use, and at will alter a corporate seal, but failure to affix a seal does not affect the validity of any instrument. (b) Adopt, amend, and repeal bylaws. (c) Qualify to conduct its activities in any other state, territory, dependency, or foreign country. (d) Issue, purchase, redeem, receive, take or otherwise acquire, own, sell, lend, exchange, transfer or otherwise dispose of, pledge, use, and otherwise deal in and with its own memberships, bonds, debentures, notes, and debt securities. (e) Pay pensions, and establish and carry out pension, deferred compensation, saving, thrift, and other retirement, incentive, and benefit plans, trusts, and provisions for any or all of its directors, officers, employees, and persons providing services to it or any of its subsidiary or related or associated corporations, and to indemnify and purchase and maintain insurance on behalf of any fiduciary of such plans, trusts, or provisions. (f) Issue certificates evidencing membership in accordance with the provisions of Section 7313 and issue identity cards. (g) Levy dues, assessments, and admission and transfer fees. (h) Make donations for the public welfare or for community funds, hospital, charitable, educational, scientific, civic, religious, or similar purposes. (i) Assume obligations, enter into contracts, including contracts of guarantee or suretyship, incur liabilities, borrow or lend money or otherwise use its credit, and secure any of its obligations, contracts, or liabilities by mortgage, pledge, or other encumbrance of all or any part of its property and income. (j) Participate with others in any partnership, joint venture, or other association, transaction, or arrangement of any kind whether or not such participation involves sharing or delegation of control with or to others. (k) Act as trustee under any trust incidental to the principal objects of the corporation, and receive, hold, administer, exchange, and expend funds and property subject to such trust. (l) Carry on a business at a profit and apply any profit that results from the business activity to any activity in which it may lawfully engage. (m) (1) In anticipation of or during an emergency, take either or both of the following actions necessary to conduct the corporation’s business operations and affairs, unless emergency bylaws provide otherwise pursuant to subdivision (g) of Section 7151: (A) Modify lines of succession to accommodate the incapacity of any director, officer, employee, or agent resulting from the emergency. (B) Relocate the principal office, designate alternative principal offices or regional offices, or authorize the officers to do so. (2) During an emergency, take either or both of the following actions necessary to conduct the corporation’s business operations and affairs, unless emergency bylaws provide otherwise pursuant to subdivision (g) of Section 7151: (A) Give notice to a director or directors in any practicable manner under the circumstances, including, but not limited to, by publication and radio, when notice of a meeting of the board cannot be given to that director or directors in the manner prescribed by the bylaws or Section 7211. (B) Deem that one or more officers of the corporation present at a board meeting is a director, in order of rank and within the same rank in order of seniority, as necessary to achieve a quorum for that meeting. (3) In anticipation of or during an emergency, the board may take any action that it determines to be necessary or appropriate to respond to the emergency, mitigate the effects of the emergency, or comply with lawful federal and state government orders, but shall not take any action that requires the vote of the members, unless the required vote of the members was obtained prior to the emergency. (4) Any actions taken in good faith in anticipation of or during an emergency under this subdivision bind the corporation and shall not be used to impose liability on a corporate director, officer, employee, or agent. (5) For purposes of this subdivision, “emergency” means any of the following events or circumstances as a result of which, and only so long as, a quorum of the corporation’s board of directors cannot be readily convened for action: (A) A natural catastrophe, including, but not limited to, a hurricane, tornado, storm, high water, wind-driven water, tidal wave, tsunami, earthquake, volcanic eruption, landslide, mudslide, snowstorm, drought, epidemic, pandemic, or disease outbreak, or, regardless of cause, any fire, flood, or explosion. (B) An attack on or within this state or on the public security of its residents by an enemy of this state or on the nation by an enemy of the United States of America, or upon receipt by this state of a warning from the federal government indicating that any such enemy attack is probable or imminent. (C) An act of terrorism or other manmade disaster that results in extraordinary levels of casualties or damage or disruption severely affecting the infrastructure, environment, economy, government functions, or population, including, but not limited to, mass evacuations. (D) A state of emergency proclaimed by the Governor of this state, including any person serving as Governor in accordance with Section 10 of Article V of the California Constitution and Section 12058 of the Government Code, or by the President of the United States of America. (Amended by Stats. 2021, Ch. 523, Sec. 10. (AB 663) Effective January 1, 2022.)
  112. 7141.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 4. Powers [7140 - 7142] ( Article 4 added by Stats. 1978, Ch. 567. )

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    This section limits when internal restrictions on a nonprofit mutual benefit corporation’s powers can be used against third parties, and it says authorized corporate contracts or conveyances bind the corporation.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 4. Powers [7140 - 7142] ( Article 4 added by Stats. 1978, Ch. 567. ) ## 7141. Subject to Section 7142: (a) No limitation upon the activities, purposes, or powers of the corporation or upon the powers of the members, officers, or directors, or the manner of exercise of such powers, contained in or implied by the articles or by Chapters 15 (commencing with Section 8510), 16 (commencing with Section 8610), and 17 (commencing with Section 8710) shall be asserted as between the corporation or member, officer or director and any third person, except in a proceeding: (1) by a member or the state to enjoin the doing or continuation of unauthorized activities by the corporation or its officers, or both, in cases where third parties have not acquired rights thereby, (2) to dissolve the corporation, or (3) by the corporation or by a member suing in a representative suit against the officers or directors of the corporation for violation of their authority. (b) Any contract or conveyance made in the name of a corporation which is authorized or ratified by the board, or is done within the scope of authority, actual or apparent, conferred by the board or within the agency power of the officer executing it, except as the board’s authority is limited by law other than this part, binds the corporation, and the corporation acquires rights thereunder whether the contract is executed or wholly or in part executory. (Amended by Stats. 1979, Ch. 724.)
  113. 7142.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 4. Powers [7140 - 7142] ( Article 4 added by Stats. 1978, Ch. 567. )

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    For corporations holding assets in charitable trust, certain people may sue to remedy a breach of the trust, the Attorney General must be notified, and the court is limited in rescinding or enjoining a contract.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 4. Powers [7140 - 7142] ( Article 4 added by Stats. 1978, Ch. 567. ) ## 7142. (a) Notwithstanding Section 7141, in the case of a corporation holding assets in charitable trust, any of the following may bring an action to enjoin, correct, obtain damages for or to otherwise remedy a breach of the charitable trust: (1) The corporation, or a member in the name of the corporation pursuant to Section 7710. (2) An officer of the corporation. (3) A director of the corporation. (4) A person with a reversionary, contractual, or property interest in the assets subject to such charitable trust. (5) The Attorney General, or any person granted relator status by the Attorney General. The Attorney General shall be given notice of any action brought by the persons specified in paragraphs (1) through (4), and may intervene. (b) In an action under this section, the court may not rescind or enjoin the performance of a contract unless: (1) All of the parties to the contract are parties to the action; or (2) No party to the contract has, in good faith, and without actual notice of the trust restriction, parted with value, under the contract or in reliance upon it; and (3) It is equitable to do so. (Amended by Stats. 1979, Ch. 724.)
  114. 7150.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 5. Bylaws [7150 - 7153] ( Article 5 added by Stats. 1978, Ch. 567. )

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    Bylaws can be adopted, amended, or repealed by the board or by member approval, but only within specified limits and exceptions.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 5. Bylaws [7150 - 7153] ( Article 5 added by Stats. 1978, Ch. 567. ) ## 7150. (a) Except as provided in subdivision (c) and Sections 7151, 7220, 7224, 7512, 7613, and 7615, bylaws may be adopted, amended or repealed by the board unless the action would: (1) Materially and adversely affect the rights of members as to voting, dissolution, redemption, or transfer; (2) Increase or decrease the number of members authorized in total or for any class; (3) Effect an exchange, reclassification or cancellation of all or part of the memberships; or (4) Authorize a new class of membership. (b) Bylaws may be adopted, amended or repealed by approval of the members (Section 5034); provided, however, that such adoption, amendment or repeal also requires approval by the members of a class if such action would: (1) Materially and adversely affect the rights, privileges, preferences, restrictions or conditions of that class as to voting, dissolution, redemption, or transfer in a manner different than such action affects another class; (2) Materially and adversely affect such class as to voting, dissolution, redemption, or transfer by changing the rights, privileges, preferences, restrictions or conditions of another class; (3) Increase or decrease the number of memberships authorized for such class; (4) Increase the number of memberships authorized for another class; (5) Effect an exchange, reclassification or cancellation of all or part of the memberships of such class; or (6) Authorize a new class of memberships. (c) The articles or bylaws may restrict or eliminate the power of the board to adopt, amend or repeal any or all bylaws, subject to subdivision (e) of Section 7151. (d) Bylaws may also provide that the repeal or amendment of those bylaws, or the repeal or amendment of specified portions of those bylaws, may occur only with the approval in writing of a specified person or persons other than the board or members. However, this approval requirement, unless the bylaws specify otherwise, shall not apply if any of the following circumstances exist: (1) The specified person or persons have died or ceased to exist. (2) If the right of the specified person or persons to approve is in the capacity of an officer, trustee, or other status and the office, trust, or status has ceased to exist. (3) If the corporation has a specific proposal for amendment or repeal, and the corporation has provided written notice of that proposal, including a copy of the proposal, to the specified person or persons at the most recent address for each of them, based on the corporation’s records, and the corporation has not received written approval or nonapproval within the period specified in the notice, which shall not be less than 10 nor more than 30 days commencing at least 20 days after the notice has been provided. (Amended by Stats. 2009, Ch. 631, Sec. 17. (AB 1233) Effective January 1, 2010.)
  115. 7151.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 5. Bylaws [7150 - 7153] ( Article 5 added by Stats. 1978, Ch. 567. )

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    The bylaws must state how many directors the corporation will have, and certain changes to director-number bylaws need member approval after members are admitted. The bylaws may also set a wide range of governance rules, including meetings, committees, officers, member admissions, voting thresholds, member limits, and emergency procedures.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 5. Bylaws [7150 - 7153] ( Article 5 added by Stats. 1978, Ch. 567. ) ## 7151. (a) The bylaws shall set forth (unless such provision is contained in the articles, in which case it may only be changed by an amendment of the articles) the number of directors of the corporation, or the method of determining the number of directors of the corporation, or that the number of directors shall be not less than a stated minimum nor more than a stated maximum with the exact number of directors to be fixed, within the limits specified, by approval of the board or the members (Section 5034), in the manner provided in the bylaws, subject to subdivision (e). The number or minimum number of directors may be one or more. (b) Once members have been admitted, a bylaw specifying or changing a fixed number of directors or the maximum or minimum number or changing from a fixed to a variable board or vice versa may only be adopted by approval of the members (Section 5034). (c) The bylaws may contain any provision, not in conflict with law or the articles, for the management of the activities and for the conduct of the affairs of the corporation, including but not limited to: (1) Any provision referred to in subdivision (c) of Section 7132. (2) The time, place, and manner of calling, conducting, and giving notice of members’, directors’, and committee meetings, or of conducting mail ballots. (3) The qualifications, duties, and compensation of directors; the time of their election; and the requirements of a quorum for directors’ and committee meetings. (4) The appointment of committees, composed of directors or nondirectors, or both, by the board or any officer and the authority of any such committees. (5) The appointment, duties, compensation, and tenure of officers. (6) The mode of determination of members of record. (7) The making of reports and financial statements to members. (8) Setting, imposing, and collecting dues, assessments, and admission and transfer fees. (d) The bylaws may provide for the manner of admission, withdrawal, suspension, and expulsion of members, consistent with the requirements of Section 7341. (e) The bylaws may require, for any or all corporate actions (except as provided in paragraphs (1) and (2) of subdivision (a) of Section 7222, subdivision (c) of Section 7615, and Section 8610) the vote of a larger proportion of, or all of, the members or the members of any class, unit, or grouping of members or the vote of a larger proportion of, or all of, the directors, than is otherwise required by this part. Such a provision in the bylaws requiring such greater vote shall not be altered, amended, or repealed except by such greater vote, unless otherwise provided in the bylaws. (f) The bylaws may contain a provision limiting the number of members, in total or of any class, which the corporation is authorized to admit. (g) (1) The bylaws may contain any provision, not in conflict with the articles, to manage and conduct the business affairs of the corporation effective only in an emergency as defined in Section 7140, including, but not limited to, procedures for calling a board meeting, quorum requirements for a board meeting, and designation of additional or substitute directors. (2) During an emergency, the board may take any action that it determines to be necessary or appropriate to respond to the emergency, mitigate the effects of the emergency, or comply with lawful federal and state government orders, but shall not take any action that requires the vote of the members, unless the required vote of the members was obtained prior to the emergency. (3) All provisions of the regular bylaws consistent with the emergency bylaws shall remain effective during the emergency, and the emergency bylaws shall not be effective after the emergency ends. (4) Corporate action taken in good faith in accordance with the emergency bylaws binds the corporation, and shall not be used to impose liability on a corporate director, officer, employee, or agent. (Amended by Stats. 2021, Ch. 523, Sec. 11. (AB 663) Effective January 1, 2022.)
  116. 7152.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 5. Bylaws [7150 - 7153] ( Article 5 added by Stats. 1978, Ch. 567. )

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    A corporation may authorize delegates in its bylaws, and delegates must have one vote each and may not vote by proxy.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 5. Bylaws [7150 - 7153] ( Article 5 added by Stats. 1978, Ch. 567. ) ## 7152. A corporation may provide in its bylaws for delegates having some or all of the authority of members. Where delegates are provided for, the bylaws shall set forth delegates’ terms of office, any reasonable method for delegates’ selection and removal, and any reasonable method for calling, noticing, and holding meetings of delegates, may set forth the manner in which delegates may act by written ballot similar to Section 7513 for written ballot of members, and may set forth the manner in which delegates may participate in meetings of delegates similar to paragraph (6) of subdivision (a) of Section 7211. Each delegate shall have one vote on each matter presented for action. A delegate shall not vote by proxy. Delegates may be given a name other than “delegates.” (Amended by Stats. 2021, Ch. 523, Sec. 12. (AB 663) Effective January 1, 2022.)
  117. 7153.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 5. Bylaws [7150 - 7153] ( Article 5 added by Stats. 1978, Ch. 567. )

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    A corporation may put in its bylaws rules for voting by members or delegates by chapter, organizational unit, region, or other geographic grouping.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 5. Bylaws [7150 - 7153] ( Article 5 added by Stats. 1978, Ch. 567. ) ## 7153. A corporation may provide in its bylaws for voting by its members or delegates on the basis of chapter or other organizational unit, or by region or other geographic grouping. (Added by Stats. 1979, Ch. 724.)
  118. 7160.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 6. Location and Inspection of Articles and Bylaws [7160- 7160.] ( Article 6 added by Stats. 1978, Ch. 567. )

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    Corporations must keep their articles and bylaws at their principal office in California, make them available for member inspection during office hours, and, if they have no California office, send a copy to any member who requests it in writing.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 1. Organization and Bylaws [7110 - 7160] ( Chapter 1 added by Stats. 1978, Ch. 567. ) ## ARTICLE 6. Location and Inspection of Articles and Bylaws [7160- 7160.] ( Article 6 added by Stats. 1978, Ch. 567. ) ## 7160. Every corporation shall keep at its principal office in this state the original or a copy of its articles and bylaws as amended to date, which shall be open to inspection by the members at all reasonable times during office hours. If the corporation has no office in this state, it shall upon the written request of any member furnish to such member a copy of the articles or bylaws as amended to date. (Added by Stats. 1978, Ch. 567.)
  119. 7210.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [7210 - 7215] ( Article 1 added by Stats. 1978, Ch. 567. )

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    Each corporation must have a board of directors, and the board controls corporate activities and powers unless the part, articles, or bylaws require member approval. The board may delegate management, but remains ultimately responsible.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [7210 - 7215] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 7210. Each corporation shall have a board of directors. Subject to the provisions of this part and any limitations in the articles or bylaws relating to action required to be approved by the members (Section 5034), or by a majority of all members (Section 5033), the activities and affairs of a corporation shall be conducted and all corporate powers shall be exercised by or under the direction of the board. The board may delegate the management of the activities of the corporation to any person or persons, management company, or committee however composed, provided that the activities and affairs of the corporation shall be managed and all corporate powers shall be exercised under the ultimate direction of the board. (Amended by Stats. 1996, Ch. 589, Sec. 23. Effective January 1, 1997.)
  120. 7211.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [7210 - 7215] ( Article 1 added by Stats. 1978, Ch. 567. )

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    This section sets rules for nonprofit mutual benefit corporation board meetings, including who may call meetings, how much notice is required, quorum rules, written consents, and director voting.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [7210 - 7215] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 7211. (a) Unless otherwise provided in the articles or in the bylaws, all of the following apply: (1) Meetings of the board may be called by the chair of the board or the president or any vice president or the secretary or any two directors. (2) Regular meetings of the board may be held without notice if the time and place of the meetings are fixed by the bylaws or the board. Special meetings of the board shall be held upon four days’ notice by first-class mail or 48 hours’ notice delivered personally or by telephone, including a voice messaging system or by electronic transmission by the corporation (Section 20). The articles or bylaws may not dispense with notice of a special meeting. A notice, or waiver of notice, need not specify the purpose of any regular or special meeting of the board. (3) Notice of a meeting need not be given to a director who provided a waiver of notice or consent to holding the meeting or an approval of the minutes thereof in writing, whether before or after the meeting, or who attends the meeting without protesting, prior thereto or at its commencement, the lack of notice to that director. These waivers, consents and approvals shall be filed with the corporate records or made a part of the minutes of the meetings. (4) A majority of the directors present, whether or not a quorum is present, may adjourn any meeting to another time and place. If the meeting is adjourned for more than 24 hours, notice of an adjournment to another time or place shall be given prior to the time of the adjourned meeting to the directors who were not present at the time of the adjournment. (5) Meetings of the board may be held at a place within or without the state that has been designated in the notice of the meeting or, if not stated in the notice or if there is no notice, designated in the bylaws or by resolution of the board. (6) Directors may participate in a meeting through use of conference telephone, electronic video screen communication, or electronic transmission by and to the corporation (Sections 20 and 21). Participation in a meeting through use of conference telephone or electronic video screen communication pursuant to this subdivision constitutes presence in person at that meeting as long as all directors participating in the meeting are able to hear one another. Participation in a meeting through use of electronic transmission by and to the corporation, other than conference telephone and electronic video screen communication, pursuant to this subdivision constitutes presence in person at that meeting if both of the following apply: (A) Each director participating in the meeting can communicate with all of the other directors concurrently. (B) Each director is provided the means of participating in all matters before the board, including, without limitation, the capacity to propose, or to interpose an objection to, a specific action to be taken by the corporation. (7) A majority of the number of directors authorized in or pursuant to the articles or bylaws constitutes a quorum of the board for the transaction of business. The articles or bylaws may require the presence of one or more specified directors in order to constitute a quorum of the board to transact business, as long as the death or nonexistence of a specified director or the death or nonexistence of the person or persons otherwise authorized to appoint or designate that director does not prevent the corporation from transacting business in the normal course of events. The articles or bylaws may not provide that a quorum shall be less than one-fifth the number of directors authorized in or pursuant to the articles or bylaws, or less than two, whichever is larger, unless the number of directors authorized in or pursuant to the articles or bylaws is one, in which case one director constitutes a quorum. (8) Subject to the provisions of Sections 7212, 7233, 7234, and subdivision (e) of Section 7237 and Section 5233, insofar as it is made applicable pursuant to Section 7238, an act or decision done or made by a majority of the directors present at a meeting duly held at which a quorum is present is the act of the board. The articles or bylaws may not provide that a lesser vote than a majority of the directors present at a meeting is the act of the board. A meeting at which a quorum is initially present may continue to transact business notwithstanding the withdrawal of directors, if any action taken is approved by at least a majority of the required quorum for that meeting, or a greater number required by this division, the articles or the bylaws. (b) An action required or permitted to be taken by the board may be taken without a meeting if all directors individually or collectively consent in writing to that action and if, subject to subdivision (a) of Section 7224, the number of directors then in office constitutes a quorum. The written consent or consents shall be filed with the minutes of the proceedings of the board. The action by written consent shall have the same force and effect as a unanimous vote of the directors. For purposes of this subdivision only, “all directors” does not include an “interested director” as defined in subdivision (a) of Section 5233, insofar as it is made applicable pursuant to Section 7238 or described in subdivision (a) of Section 7233, or a “common director” as described in subdivision (b) of Section 7233 who abstains in writing from providing consent, where (1) the facts described in paragraph (2) or (3) of subdivision (d) of Section 5233 are established or the provisions of paragraph (1) or (2) of subdivision (a) of Section 7233 or in paragraph (1) or (2) of subdivision (b) of Section 7233 are satisfied, as appropriate, at or prior to execution of the written consent or consents; (2) the establishment of those facts or satisfaction of those provisions, as applicable, is included in the written consent or consents executed by the noninterested directors or noncommon directors or in other records of the corporation; and (3) the noninterested directors or noncommon directors, as applicable, approve the action by a vote that is sufficient without counting the votes of the interested directors or common directors. (c) Each director shall have one vote on each matter presented to the board of directors for action. A director shall not vote by proxy. (d) This section applies also to incorporators, to committees of the board, and to action by those incorporators or committees mutatis mutandis. (Amended by Stats. 2020, Ch. 370, Sec. 38. (SB 1371) Effective January 1, 2021.)
  121. 7212.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [7210 - 7215] ( Article 1 added by Stats. 1978, Ch. 567. )

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    The board may create committees and give them board powers, subject to limits and bylaw/resolution conditions.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [7210 - 7215] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 7212. (a) The board may, by resolution adopted by a majority of the number of directors then in office, provided that a quorum is present, create one or more committees, each consisting of two or more directors, to serve at the pleasure of the board. Appointments to such committees shall be by a majority vote of the directors then in office, unless the articles or bylaws require a majority vote of the number of directors authorized in or pursuant to the articles or bylaws. The bylaws may authorize one or more such committees, each consisting of two or more directors, and may provide that a specified officer or officers who are also directors of the corporation shall be a member or members of such committee or committees. The board may appoint one or more directors as alternate members of such committee, who may replace any absent member at any meeting of the committee. Such committee, to the extent provided in the resolution of the board or in the bylaws, shall have all the authority of the board, except with respect to: (1) The approval of any action for which this part also requires approval of the members (Section 5034) or approval of a majority of all members (Section 5033), regardless of whether the corporation has members. (2) The filling of vacancies on the board or in any committee which has the authority of the board. (3) The fixing of compensation of the directors for serving on the board or on any committee. (4) The amendment or repeal of bylaws or the adoption of new bylaws. (5) The amendment or repeal of any resolution of the board which by its express terms is not so amendable or repealable. (6) The appointment of committees of the board or the members thereof. (7) The expenditure of corporate funds to support a nominee for director after there are more people nominated for director than can be elected. (8) With respect to any assets held in charitable trust, the approval of any self-dealing transaction except as provided in paragraph (3) of subdivision (d) of Section 5233. (b) A committee exercising the authority of the board shall not include as members persons who are not directors. However, the board may create other committees that do not exercise the authority of the board and these other committees may include persons regardless of whether they are directors. (c) Unless the bylaws otherwise provide, the board may delegate to any committee, appointed pursuant to paragraph (4) of subdivision (c) of Section 7151 or otherwise, powers as authorized by Section 7210, but may not delegate the powers set forth in paragraphs (1) to (8), inclusive, of subdivision (a). (Amended by Stats. 2011, Ch. 442, Sec. 15. (AB 1211) Effective January 1, 2012.)
  122. 7213.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [7210 - 7215] ( Article 1 added by Stats. 1978, Ch. 567. )

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    A corporation must maintain specified officers, the board chooses officers unless the articles or bylaws say otherwise, and an officer may resign by written notice.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [7210 - 7215] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 7213. (a) A corporation shall have (1) a chair of the board, who may be given the title chair, chairperson, chair of the board, or chairperson of the board, or a president or both, (2) a secretary, (3) a treasurer or a chief financial officer or both, and (4) any other officers with any titles and duties as shall be stated in the bylaws or determined by the board and as may be necessary to enable it to sign instruments. The president, or if there is no president the chair of the board, is the general manager and chief executive officer of the corporation, unless otherwise provided in the articles or bylaws. Unless otherwise specified in the articles or the bylaws, if there is no chief financial officer, the treasurer is the chief financial officer of the corporation. Any number of offices may be held by the same person unless the articles or bylaws provide otherwise. Where a corporation holds assets in charitable trust, any compensation of the president or chief executive officer and the chief financial officer or treasurer shall be determined in accordance with subdivision (g) of Section 12586 of the Government Code, if applicable. (b) Except as otherwise provided by the articles or bylaws, officers shall be chosen by the board and serve at the pleasure of the board, subject to the rights, if any, of an officer under any contract of employment. Any officer may resign at any time upon written notice to the corporation without prejudice to the rights, if any, of the corporation under any contract to which the officer is a party. (Amended by Stats. 2022, Ch. 617, Sec. 57. (SB 1202) Effective January 1, 2023.)
  123. 7214.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [7210 - 7215] ( Article 1 added by Stats. 1978, Ch. 567. )

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    Certain written corporate instruments signed by listed officers are not invalidated against the corporation just because the officers lacked authority, unless the other party actually knew they lacked authority.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [7210 - 7215] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 7214. Subject to the provisions of subdivision (a) of Section 7141 and Section 7142, any note, mortgage, evidence of indebtedness, contract, conveyance or other instrument in writing, and any assignment or endorsement thereof, executed or entered into between any corporation and any other person, when signed by any one of the chairperson of the board, the president or any vice president and by any one of the secretary, any assistant secretary, the chief financial officer, or any assistant treasurer of such corporation, is not invalidated as to the corporation by any lack of authority of the signing officers in the absence of actual knowledge on the part of the other person that the signing officers had no authority to execute the same. (Amended by Stats. 2022, Ch. 617, Sec. 58. (SB 1202) Effective January 1, 2023.)
  124. 7215.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [7210 - 7215] ( Article 1 added by Stats. 1978, Ch. 567. )

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    A certified original or copy of certain corporate records is prima facie evidence of the adoption of bylaws or resolutions, or of the proper holding of the meeting and the matters stated in it.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [7210 - 7215] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 7215. The original or a copy in writing or in any other form capable of being converted into clearly legible tangible form of the bylaws or of the minutes of any incorporators’, members’, directors’, committee or other meeting or of any resolution adopted by the board or a committee thereof, or members, certified to be a true copy by a person purporting to be the secretary or an assistant secretary of the corporation, is prima facie evidence of the adoption of such bylaws or resolution or of the due holding of such meeting and of the matters stated therein. (Amended by Stats. 2004, Ch. 254, Sec. 23. Effective January 1, 2005.)
  125. 7220.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Selection, Removal and Resignation of Directors [7220 - 7225] ( Article 2 added by Stats. 1978, Ch. 567. )

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    This section sets limits and options for how nonprofit mutual benefit corporation directors are elected, how long they serve, and when their terms end.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Selection, Removal and Resignation of Directors [7220 - 7225] ( Article 2 added by Stats. 1978, Ch. 567. ) ## 7220. (a) Except as provided in subdivision (d), (e), or (f), directors shall be elected for terms of not longer than four years, as fixed in the articles or bylaws. However, the terms of directors of a corporation without members may be up to six years. In the absence of any provision in the articles or bylaws, the term shall be one year. The articles or bylaws may provide for staggering the terms of directors by dividing the total number of directors into groups of one or more directors. The terms of office of the several groups and the number of directors in each group need not be uniform. No amendment of the articles or bylaws may extend the term of a director beyond that for which the director was elected, nor may any bylaw provision increasing the terms of directors be adopted without approval of the members (Section 5034). (b) Except as otherwise provided in the articles or bylaws, each director, including a director elected to fill a vacancy, shall hold office until the expiration of the term for which elected and until a successor has been elected and qualified, unless the director has been removed from office. (c) The articles or bylaws may provide for the election of one or more directors by the members of any class voting as a class. (d) For the purposes of this subdivision, “designator” means one or more designators. Notwithstanding subdivisions (a) to (c), inclusive, all or any portion of the directors authorized in the articles or bylaws of a corporation may hold office by virtue of designation or selection by a specified designator as provided by the articles or bylaws rather than by election. Those directors shall continue in office for the term prescribed by the governing article or bylaw provision, or, if there is no term prescribed, until the governing article or bylaw provision is duly amended or repealed, except as provided in subdivision (e) of Section 7222. A bylaw provision authorized by this subdivision may be adopted, amended, or repealed only by approval of the members (Section 5034), except as provided in subdivision (d) of Section 7150. Unless otherwise provided in the articles or bylaws, the entitlement to designate or select a director or directors shall cease if any of the following circumstances exist: (1) The specified designator of that director or directors has died or ceased to exist. (2) If the entitlement of the specified designator of that director or directors to designate is in the capacity of an officer, trustee, or other status and the office, trust, or status has ceased to exist. (e) If a corporation has not issued memberships and (1) all the directors resign, die, or become incompetent, or (2) a corporation’s initial directors have not been named in the articles and all incorporators resign, die, or become incompetent before the election of the initial directors, the superior court of any county may appoint directors of the corporation upon application by any party in interest. (f) If authorized in the articles or bylaws of a corporation, all or any portion of the directors may hold office ex officio by virtue of occupying a specified position within the corporation or outside the corporation. The term of office of an ex officio director shall coincide with that director’s respective term of office in the specified position entitling him or her to serve on the board of directors. Upon an ex officio director’s resignation or removal from that position, or resignation or removal from the board for any reason, the term of office as a director of the corporation shall immediately cease. At that time, the successor in office shall become an ex officio director of the corporation, occupying the place of the former director. (Amended by Stats. 2018, Ch. 322, Sec. 3. (AB 2557) Effective January 1, 2019.)
  126. 7221.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Selection, Removal and Resignation of Directors [7220 - 7225] ( Article 2 added by Stats. 1978, Ch. 567. )

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    The board may declare a director’s office vacant if specified disqualifying events occur, including unsound mind, felony conviction, certain charitable-trust breaches, missed meetings when bylaws allow removal for that reason, or failure to keep required qualifications.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Selection, Removal and Resignation of Directors [7220 - 7225] ( Article 2 added by Stats. 1978, Ch. 567. ) ## 7221. (a) The board may declare vacant the office of a director who has been declared of unsound mind by a final order of court, or convicted of a felony, or, in the case of a corporation holding assets in charitable trust, has been found by a final order or judgment of any court to have breached any duty arising as a result of Section 7238, or, if at the time a director is elected, the bylaws provide that a director may be removed for missing a specified number of board meetings, fails to attend the specified number of meetings. (b) As provided in paragraph (3) of subdivision (c) of Section 7151, the articles or bylaws may prescribe the qualifications of the directors. The board, by a majority vote of the directors who meet all of the required qualifications to be a director, may declare vacant the office of any director who fails or ceases to meet any required qualification that was in effect at the beginning of that director’s current term of office. (Amended by Stats. 1996, Ch. 589, Sec. 26. Effective January 1, 1997.)
  127. 7222.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Selection, Removal and Resignation of Directors [7220 - 7225] ( Article 2 added by Stats. 1978, Ch. 567. )

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    This section lets members, or in some cases directors or a designator, remove directors under specified voting and bylaw conditions.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Selection, Removal and Resignation of Directors [7220 - 7225] ( Article 2 added by Stats. 1978, Ch. 567. ) ## 7222. (a) Subject to subdivisions (b) and (f), any or all directors may be removed without cause if: (1) In a corporation with fewer than 50 members, the removal is approved by a majority of all members (Section 5033). (2) In a corporation with 50 or more members, the removal is approved by the members (Section 5034). (3) In a corporation with no members, the removal is approved by a majority of the directors then in office. (b) Except for a corporation having no members, pursuant to Section 7310: (1) In a corporation in which the articles or bylaws authorize members to cumulate their votes pursuant to subdivision (a) of Section 7615, no director may be removed (unless the entire board is removed) when the votes cast against removal, or not consenting in writing to the removal, would be sufficient to elect the director if voted cumulatively at an election at which the same total number of votes were cast (or, if the action is taken by written ballot, all memberships entitled to vote were voted) and the entire number of directors authorized at the time of the director’s most recent election were then being elected. (2) When by the provisions of the articles or bylaws the members of any class, voting as a class, are entitled to elect one or more directors, any director so elected may be removed only by the applicable vote of the members of that class. (3) When by the provisions of the articles or bylaws the members within a chapter or other organizational unit, or region or other geographic grouping, voting as such, are entitled to elect one or more directors, any director so elected may be removed only by the applicable vote of the members within the organizational unit or geographic grouping. (c) Any reduction of the authorized number of directors or any amendment reducing the number of classes of directors does not remove any director prior to the expiration of the director’s term of office unless the reduction or amendment also provides for the removal of one or more specified directors. (d) Except as provided in this section and Sections 7221 and 7223, a director may not be removed prior to the expiration of the director’s term of office. (e) Where a director removed under this section or Section 7221 or 7223 was chosen by designation pursuant to subdivision (d) of Section 7220, then: (1) Where a different person may be designated pursuant to the governing article or bylaw provision, the new designation shall be made. (2) Where the governing article or bylaw provision contains no provision under which a different person may be designated, the governing article or bylaw provision shall be deemed repealed. (f) For the purposes of this subdivision, “designator” means one or more designators. If by the provisions of the articles or bylaws a designator is entitled to designate one or more directors, then: (1) Unless otherwise provided in the articles or bylaws at the time of designation, any director so designated may be removed without cause by the designator of that director. (2) Any director so designated may only be removed under subdivision (a) with the written consent of the designator of that director. (3) Unless otherwise provided in the articles or bylaws, the right to remove shall not apply if any of the following circumstances exist: (A) The designator entitled to that right has died or ceased to exist. (B) If that right is in the capacity of an officer, trustee, or other status, and the office, trust, or status has ceased to exist. (Amended by Stats. 2009, Ch. 631, Sec. 23. (AB 1233) Effective January 1, 2010.)
  128. 7223.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Selection, Removal and Resignation of Directors [7220 - 7225] ( Article 2 added by Stats. 1978, Ch. 567. )

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    A court may remove a director for fraudulent or dishonest acts, gross abuse of authority or discretion, or certain duty breaches, and may bar reelection for a court-set period.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Selection, Removal and Resignation of Directors [7220 - 7225] ( Article 2 added by Stats. 1978, Ch. 567. ) ## 7223. (a) The superior court of the proper county may, at the suit of one of the parties specified in subdivision (b), remove from office any director in case of fraudulent or dishonest acts or gross abuse of authority or discretion with reference to the corporation or breach of any duty arising as a result of Section 7238 and may bar from reelection any director so removed for a period prescribed by the court. The corporation shall be made a party to such action. (b) An action under subdivision (a) may be instituted by any of the following: (1) A director. (2) In the case of a corporation where the total number of votes entitled to be cast for a director is less than 5,000, twice the authorized number (Section 5036) of members, or 20 members, whichever is less. (3) In the case of a corporation where the total number of votes entitled to be cast for a director is 5,000 or more, twice the authorized number (Section 5036) of members, or 100 members, whichever is less. (c) In the case of a corporation holding assets in charitable trust, the Attorney General may bring an action under subdivision (a), may intervene in such an action brought by any other party and shall be given notice of any such action brought by any other party. (Amended by Stats. 1981, Ch. 587, Sec. 29.)
  129. 7224.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Selection, Removal and Resignation of Directors [7220 - 7225] ( Article 2 added by Stats. 1978, Ch. 567. )

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    This section governs how nonprofit mutual benefit corporation board vacancies are filled and how a director may resign in writing.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Selection, Removal and Resignation of Directors [7220 - 7225] ( Article 2 added by Stats. 1978, Ch. 567. ) ## 7224. (a) Unless otherwise provided in the articles or bylaws and except for a vacancy created by the removal of a director, vacancies on the board may be filled by approval of the board (Section 5032) or, if the number of directors then in office is less than a quorum, by (1) the unanimous written consent of the directors then in office, (2) the affirmative vote of a majority of the directors then in office at a meeting held pursuant to notice or waivers of notice complying with Section 7211, or (3) a sole remaining director. Unless the articles or a bylaw approved by the members (Section 5034) provide that the board may fill vacancies occurring in the board by reason of the removal of directors, or unless the corporation has no members pursuant to Section 7310, such vacancies may be filled only by approval of the members (Section 5034). (b) The members may elect a director at any time to fill any vacancy not filled by the directors. (c) Any director may resign effective upon giving written notice to the chairperson of the board, the president, the secretary, or the board of directors of the corporation, unless the notice specifies a later time for the effectiveness of such resignation. If the resignation is effective at a future time, a successor may be elected to take office when the resignation becomes effective. (Amended by Stats. 2022, Ch. 617, Sec. 59. (SB 1202) Effective January 1, 2023.)
  130. 7225.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Selection, Removal and Resignation of Directors [7220 - 7225] ( Article 2 added by Stats. 1978, Ch. 567. )

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    A court may appoint a provisional director when a nonprofit corporation’s directors or members are deadlocked. In charitable trust cases, notice must be given to the Attorney General, who may intervene or bring the action. A provisional director must be impartial and gets director powers and possible court-fixed compensation.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Selection, Removal and Resignation of Directors [7220 - 7225] ( Article 2 added by Stats. 1978, Ch. 567. ) ## 7225. (a) If a corporation has an even number of directors who are equally divided and cannot agree as to the management of its affairs, so that its activities can no longer be conducted to advantage or so that there is danger that its property, activities, or business will be impaired or lost, the superior court of the proper county may, notwithstanding any provisions of the articles or bylaws and whether or not an action is pending for an involuntary winding up or dissolution of the corporation, appoint a provisional director pursuant to this section. Action for such appointment may be brought by any director or by members holding not less than 331/3 percent of the voting power. (b) If the members of a corporation are deadlocked so that they cannot elect the directors to be elected at the time prescribed therefor, the superior court of the proper county may, notwithstanding any provisions of the articles or bylaws, upon petition of members holding 50 percent of the voting power, appoint a provisional director or directors pursuant to this section or order such other equitable relief as the court deems appropriate. (c) In the case of a corporation holding assets in charitable trust: (1) Any person bringing an action under subdivision (a) or (b) shall give notice to the Attorney General, who may intervene; and (2) The Attorney General may bring an action under subdivision (a) or (b). (d) A provisional director shall be an impartial person, who is neither a member nor a creditor of the corporation, nor related by consanguinity or affinity within the third degree according to the common law to any of the other directors of the corporation or to any judge of the court by which such provisional director is appointed. A provisional director shall have all the rights and powers of a director until the deadlock in the board or among members is broken or until such provisional director is removed by order of the court or by approval of a majority of all members (Section 5033). Such person shall be entitled to such compensation as shall be fixed by the court unless otherwise agreed with the corporation. (Amended by Stats. 1995, Ch. 154, Sec. 16. Effective January 1, 1996.)
  131. 7230.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Standards of Conduct [7230 - 7238] ( Article 3 added by Stats. 1978, Ch. 567. )

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    This section says the article’s duties and liabilities apply even if a director is paid, and Probate Code Part 4 does not apply to directors of any corporation.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Standards of Conduct [7230 - 7238] ( Article 3 added by Stats. 1978, Ch. 567. ) ## 7230. (a) Any duties and liabilities set forth in this article shall apply without regard to whether a director is compensated by the corporation. (b) Part 4 (commencing with Section 16000) of Division 9 of the Probate Code does not apply to the directors of any corporation. (Amended by Stats. 1987, Ch. 923, Sec. 1.3. Operative January 1, 1988, by Sec. 103 of Ch. 923.)
  132. 7231.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Standards of Conduct [7230 - 7238] ( Article 3 added by Stats. 1978, Ch. 567. )

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    Directors must perform their duties in good faith, in the corporation’s best interests, and with reasonable care.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Standards of Conduct [7230 - 7238] ( Article 3 added by Stats. 1978, Ch. 567. ) ## 7231. (a) A director shall perform the duties of a director, including duties as a member of any committee of the board upon which the director may serve, in good faith, in a manner such director believes to be in the best interests of the corporation and with such care, including reasonable inquiry, as an ordinarily prudent person in a like position would use under similar circumstances. (b) In performing the duties of a director, a director shall be entitled to rely on information, opinions, reports or statements, including financial statements and other financial data, in each case prepared or presented by: (1) One or more officers or employees of the corporation whom the director believes to be reliable and competent in the matters presented; (2) Counsel, independent accountants or other persons as to matters which the director believes to be within such person’s professional or expert competence; or (3) A committee upon which the director does not serve that is composed exclusively of any or any combination of directors, persons described in paragraph (1), or persons described in paragraph (2), as to matters within the committee’s designated authority, which committee the director believes to merit confidence, so long as, in any case, the director acts in good faith, after reasonable inquiry when the need therefor is indicated by the circumstances and without knowledge that would cause such reliance to be unwarranted. (c) A person who performs the duties of a director in accordance with subdivisions (a) and (b) shall have no liability based upon any alleged failure to discharge the person’s obligations as a director, including, without limiting the generality of the foregoing, any actions or omissions which exceed or defeat a public or charitable purpose to which assets held by a corporation are dedicated. (Amended by Stats. 2009, Ch. 631, Sec. 24. (AB 1233) Effective January 1, 2010.)
  133. 7231.5.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Standards of Conduct [7230 - 7238] ( Article 3 added by Stats. 1978, Ch. 567. )

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    Volunteer directors and volunteer executive officers of covered nonprofit corporations are shielded from monetary liability and damages claims for duty failures if they act in good faith, in the corporation’s best interests, and with ordinary prudent care, subject to stated exceptions.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Standards of Conduct [7230 - 7238] ( Article 3 added by Stats. 1978, Ch. 567. ) ## 7231.5. (a) Except as provided in Section 7233 or 7236, there is no monetary liability on the part of, and no cause of action for damages shall arise against, any volunteer director or volunteer executive officer of a nonprofit corporation subject to this part based upon any alleged failure to discharge the person’s duties as a director or officer if the duties are performed in a manner that meets all of the following criteria: (1) The duties are performed in good faith. (2) The duties are performed in a manner such director or officer believes to be in the best interests of the corporation. (3) The duties are performed with such care, including reasonable inquiry, as an ordinarily prudent person in a like position would use under similar circumstances. (b) “Volunteer” means the rendering of services without compensation. “Compensation” means remuneration whether by way of salary, fee, or other consideration for services rendered. However, the payment of per diem, mileage, or other reimbursement expenses to a director or executive officer does not affect that person’s status as a volunteer within the meaning of this section. (c) “Executive officer” means the president, vice president, secretary, or treasurer of a corporation or other individual serving in like capacity who assists in establishing the policy of the corporation. (d) This section shall apply only to trade, professional, and labor organizations incorporated pursuant to this part which operate exclusively for fraternal, educational, and other nonprofit purposes, and under the provisions of Section 501(c) of the United States Internal Revenue Code. (e) This section shall not be construed to limit the provisions of Section 7231. (Amended by Stats. 1990, Ch. 107, Sec. 5.)
  134. 7232.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Standards of Conduct [7230 - 7238] ( Article 3 added by Stats. 1978, Ch. 567. )

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    Section 7231 governs directors’ duties for acts or omissions connected to electing, selecting, or nominating directors.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Standards of Conduct [7230 - 7238] ( Article 3 added by Stats. 1978, Ch. 567. ) ## 7232. (a) Section 7231 governs the duties of directors as to any acts or omissions in connection with the election, selection, or nomination of directors. (b) This section shall not be construed to limit the generality of Section 7231. (Added by Stats. 1978, Ch. 567.)
  135. 7233.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Standards of Conduct [7230 - 7238] ( Article 3 added by Stats. 1978, Ch. 567. )

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    This section says certain contracts or transactions involving a corporation and its directors are not automatically void or voidable if disclosure, approval, and fairness conditions are met.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Standards of Conduct [7230 - 7238] ( Article 3 added by Stats. 1978, Ch. 567. ) ## 7233. (a) No contract or other transaction between a corporation and one or more of its directors, or between a corporation and any domestic or foreign corporation, firm or association in which one or more of its directors has a material financial interest, is either void or voidable because such director or directors or such other corporation, business corporation, firm or association are parties or because such director or directors are present at the meeting of the board or a committee thereof which authorizes, approves or ratifies the contract or transaction, if: (1) The material facts as to the transaction and as to such director’s interest are fully disclosed or known to the members and such contract or transaction is approved by the members (Section 5034) in good faith, with any membership owned by any interested director not being entitled to vote thereon; (2) The material facts as to the transaction and as to such director’s interest are fully disclosed or known to the board or committee, and the board or committee authorizes, approves or ratifies the contract or transaction in good faith by a vote sufficient without counting the vote of the interested director or directors and the contract or transaction is just and reasonable as to the corporation at the time it is authorized, approved or ratified; or (3) As to contracts or transactions not approved as provided in paragraph (1) or (2) of this subdivision, the person asserting the validity of the contract or transaction sustains the burden of proving that the contract or transaction was just and reasonable as to the corporation at the time it was authorized, approved or ratified. A mere common directorship does not constitute a material financial interest within the meaning of this subdivision. A director is not interested within the meaning of this subdivision in a resolution fixing the compensation of another director as a director, officer or employee of the corporation, notwithstanding the fact that the first director is also receiving compensation from the corporation. (b) No contract or other transaction between a corporation and any corporation, business corporation or association of which one or more of its directors are directors is either void or voidable because such director or directors are present at the meeting of the board or a committee thereof which authorizes, approves or ratifies the contract or transaction, if: (1) The material facts as to the transaction and as to such director’s other directorship are fully disclosed or known to the board or committee, and the board or committee authorizes, approves or ratifies the contract or transaction in good faith by a vote sufficient without counting the vote of the common director or directors or the contract or transaction is approved by the members (Section 5034) in good faith; or (2) As to contracts or transactions not approved as provided in paragraph (1) of this subdivision, the contract or transaction is just and reasonable as to the corporation at the time it is authorized, approved or ratified. This subdivision does not apply to contracts or transactions covered by subdivision (a). (Amended by Stats. 1979, Ch. 724.)
  136. 7234.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Standards of Conduct [7230 - 7238] ( Article 3 added by Stats. 1978, Ch. 567. )

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    Interested or common directors may be counted toward a quorum for certain board or committee meetings.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Standards of Conduct [7230 - 7238] ( Article 3 added by Stats. 1978, Ch. 567. ) ## 7234. Interested or common directors may be counted in determining the presence of a quorum at a meeting of the board or a committee thereof which authorizes, approves or ratifies a contract or transaction as provided in Section 7233. (Added by Stats. 1978, Ch. 567.)
  137. 7235.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Standards of Conduct [7230 - 7238] ( Article 3 added by Stats. 1978, Ch. 567. )

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    A corporation may make certain loans, guaranties, and expense advances to directors or officers, if the listed approvals and conditions are met and the articles or bylaws do not prohibit it.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Standards of Conduct [7230 - 7238] ( Article 3 added by Stats. 1978, Ch. 567. ) ## 7235. (a) Unless prohibited by the articles or bylaws, a corporation may loan money or property to, or guarantee the obligation of, any director or officer of the corporation or of its parent, affiliate or subsidiary, provided: (1) The board determines the loan or guaranty may reasonably be expected to benefit the corporation. (2) Prior to consummating the transaction or any part thereof, the loan or guaranty is either: (A) Approved by the members (Section 5034), without counting the vote of the director or officer, if a member, or (B) Approved by the vote of a majority of the directors then in office, without counting the vote of the director who is to receive the loan or the benefit of the guaranty. (b) Notwithstanding subdivision (a), a corporation may advance money to a director or officer of the corporation or of its parent, affiliate or subsidiary, for any expenses reasonably anticipated to be incurred in the performance of the duties of the director or officer of the corporation or of its parent, affiliate or subsidiary, provided that in the absence of such an advance the director or officer would be entitled to be reimbursed for these expenses by the corporation, its parent, affiliate, or subsidiary. (c) The provisions of subdivisions (a) and (b) do not apply to credit unions, or to the payment of premiums in whole or in part by a corporation on a life insurance policy on the life of a director or officer so long as repayment to the corporation of the amount paid by it is secured by the proceeds of the policy and its cash surrender value, or to loans permitted under any statute regulating any special class of corporations. (Amended by Stats. 1983, Ch. 1085, Sec. 5.)
  138. 7236.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Standards of Conduct [7230 - 7238] ( Article 3 added by Stats. 1978, Ch. 567. )

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    Directors who approve certain improper corporate actions can be jointly and severally liable, and abstaining while present at the meeting counts as approval.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Standards of Conduct [7230 - 7238] ( Article 3 added by Stats. 1978, Ch. 567. ) ## 7236. (a) Subject to the provisions of Section 7231, directors of a corporation who approve any of the following corporate actions shall be jointly and severally liable to the corporation for the benefit of all of the creditors entitled to institute an action under paragraph (1) or (2) of subdivision (c) or to the corporation in an action by the head organization or members under paragraph (1) or (3) of subdivision (c): (1) The making of any distribution contrary to Chapter 4 (commencing with Section 7410). (2) The distribution of assets after institution of dissolution proceedings of the corporation, without paying or adequately providing for all known liabilities of the corporation, excluding any claims not filed by creditors within the time limit set by the court in a notice given to creditors under Chapter 15 (commencing with Section 8510), Chapter 16 (commencing with Section 8610), and Chapter 17 (commencing with Section 8710). (3) The making of any loan or guaranty contrary to Section 7235. (b) A director who is present at a meeting of the board, or any committee thereof, at which an action specified in subdivision (a) is taken and who abstains from voting shall be considered to have approved the action. (c) Suit may be brought in the name of the corporation to enforce the liability: (1) Under paragraph (1) of subdivision (a), against any or all directors liable by the persons entitled to sue under subdivision (c) of Section 7420. (2) Under paragraph (2) or (3) of subdivision (a), against any or all directors liable by any one or more creditors of the corporation whose debts or claims arose prior to the time of the corporate action who have not consented to the corporate action, whether or not they have reduced their claims to judgment. (3) Under paragraph (3) of subdivision (a), against any or all directors liable by any one or more members at the time of any corporate action specified in paragraph (3) of subdivision (a) who have not consented to the corporate action, without regard to the provisions of Section 7710. (d) The damages recoverable from a director under this section shall be the amount of the illegal distribution, or if the illegal distribution consists of property, the fair market value of that property at the time of the illegal distribution, plus interest thereon from the date of the distribution at the legal rate on judgments until paid, together with all reasonably incurred costs of appraisal or other valuation, if any, of that property, or the loss suffered by the corporation as a result of the illegal loan or guaranty, but not exceeding, in the case of an action for the benefit of creditors, the liabilities of the corporation owed to nonconsenting creditors at the time of the violation. (e) Any director sued under this section may implead all other directors liable and may compel contribution, either in that action or in an independent action against directors not joined in that action. (f) Directors liable under this section shall also be entitled to be subrogated to the rights of the corporation: (1) With respect to paragraph (1) of subdivision (a), against the persons who received the distribution. (2) With respect to paragraph (2) of subdivision (a), against the persons who received the distribution. (3) With respect to paragraph (3) of subdivision (a), against the person who received the loan or guaranty. Any director sued under this section may file a cross-complaint against the person or persons who are liable to the director as a result of the subrogation provided for in this subdivision or may proceed against them in an independent action. (Amended by Stats. 2000, Ch. 135, Sec. 23. Effective January 1, 2001.)
  139. 7237.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Standards of Conduct [7230 - 7238] ( Article 3 added by Stats. 1978, Ch. 567. )

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    A nonprofit corporation may indemnify agents and may advance defense expenses or buy insurance for them, subject to stated conditions and exceptions.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Standards of Conduct [7230 - 7238] ( Article 3 added by Stats. 1978, Ch. 567. ) ## 7237. (a) For purposes of this section, “agent” means a person who is or was a director, officer, employee, or other agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee, or agent of another foreign or domestic corporation, partnership, joint venture, trust or other enterprise, or was a director, officer, employee, or agent of a foreign or domestic corporation that was a predecessor corporation of the corporation or of another enterprise at the request of the predecessor corporation; “proceeding” means any threatened, pending, or completed action or proceeding, whether civil, criminal, administrative, or investigative; and “expenses” includes, without limitation, attorneys’ fees and any expenses of establishing a right to indemnification under subdivision (d) or paragraph (3) of subdivision (e). (b) A corporation shall have power to indemnify a person who was or is a party or is threatened to be made a party to any proceeding (other than an action by or in the right of the corporation to procure a judgment in its favor, an action brought under Section 5233 of Part 2 (commencing with Section 5110) made applicable pursuant to Section 7238, or an action brought by the Attorney General or a person granted relator status by the Attorney General for any breach of duty relating to assets held in charitable trust) by reason of the fact that the person is or was an agent of the corporation, against expenses, judgments, fines, settlements, and other amounts actually and reasonably incurred in connection with the proceeding if the person acted in good faith and in a manner the person reasonably believed to be in the best interests of the corporation and, in the case of a criminal proceeding, had no reasonable cause to believe the conduct of the person was unlawful. The termination of any proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent shall not, of itself, create a presumption that the person did not act in good faith and in a manner which the person reasonably believed to be in the best interests of the corporation or that the person had reasonable cause to believe that the person’s conduct was unlawful. (c) A corporation shall have power to indemnify a person who was or is a party or is threatened to be made a party to any threatened, pending, or completed action by or in the right of the corporation, or brought under Section 5233 of Part 2 (commencing with Section 5110) made applicable pursuant to Section 7238, or brought by the Attorney General or a person granted relator status by the Attorney General for breach of duty relating to assets held in charitable trust, to procure a judgment in its favor by reason of the fact that the person is or was an agent of the corporation, against expenses actually and reasonably incurred by the person in connection with the defense or settlement of the action if the person acted in good faith, in a manner the person believed to be in the best interests of the corporation and with such care, including reasonable inquiry, as an ordinarily prudent person in a like position would use under similar circumstances. No indemnification shall be made under this subdivision: (1) With respect to any claim, issue, or matter as to which the person shall have been adjudged to be liable to the corporation in the performance of the person’s duty to the corporation, unless and only to the extent that the court in which the proceeding is or was pending shall determine upon application that, in view of all the circumstances of the case, the person is fairly and reasonably entitled to indemnity for the expenses which the court shall determine; (2) Of amounts paid in settling or otherwise disposing of a threatened or pending action, with or without court approval; or (3) Of expenses incurred in defending a threatened or pending action that is settled or otherwise disposed of without court approval unless the action concerns assets held in charitable trust and is settled with the approval of the Attorney General. (d) To the extent that an agent of a corporation has been successful on the merits in defense of any proceeding referred to in subdivision (b) or (c) or in defense of any claim, issue, or matter therein, the agent shall be indemnified against expenses actually and reasonably incurred by the agent in connection therewith. (e) Except as provided in subdivision (d), any indemnification under this section shall be made by the corporation only if authorized in the specific case, upon a determination that indemnification of the agent is proper in the circumstances because the agent has met the applicable standard of conduct set forth in subdivision (b) or (c), by: (1) A majority vote of a quorum consisting of directors who are not parties to the proceeding; (2) Approval of the members (Section 5034), with the persons to be indemnified not being entitled to vote thereon; or (3) The court in which the proceeding is or was pending upon application made by the corporation or the agent or the attorney, or other person rendering services in connection with the defense, whether or not the application by the agent, attorney or other person is opposed by the corporation. (f) Expenses incurred in defending any proceeding may be advanced by the corporation before the final disposition of the proceeding upon receipt of an undertaking by or on behalf of the agent to repay the amount unless it shall be determined ultimately that the agent is entitled to be indemnified as authorized in this section. The provisions of subdivision (a) of Section 7235 do not apply to advances made pursuant to this subdivision. (g) A provision made by a corporation to indemnify its or its subsidiary’s directors or officers for the defense of any proceeding, whether contained in the articles, bylaws, a resolution of members or directors, an agreement, or otherwise, shall not be valid unless consistent with this section. Nothing contained in this section shall affect any right to indemnification to which persons other than the directors and officers may be entitled by contract or otherwise. (h) No indemnification or advance shall be made under this section, except as provided in subdivision (d) or paragraph (3) of subdivision (e), in any circumstance where it appears: (1) That it would be inconsistent with a provision of the articles, bylaws, a resolution of the members, or an agreement in effect at the time of the accrual of the alleged cause of action asserted in the proceeding in which the expenses were incurred or other amounts were paid, which prohibits or otherwise limits indemnification; or (2) That it would be inconsistent with any condition expressly imposed by a court in approving a settlement. (i) A corporation shall have power to purchase and maintain insurance on behalf of an agent of the corporation against any liability asserted against or incurred by the agent in that capacity or arising out of the agent’s status as such whether or not the corporation would have the power to indemnify the agent against that liability under the provisions of this section. (j) This section does not apply to any proceeding against a trustee, investment manager, or other fiduciary of a pension, deferred compensation, saving, thrift, or other retirement, incentive, or benefit plan, trust, or provision for any or all of the corporation’s directors, officers, employees, and persons providing services to the corporation or any of its subsidiary or related or affiliated corporations, in that person’s capacity as such, even though the person may also be an agent as defined in subdivision (a) of the employer corporation. A corporation shall have power to indemnify the trustee, investment manager, or other fiduciary to the extent permitted by subdivision (e) of Section 7140. (Amended by Stats. 2013, Ch. 76, Sec. 25. (AB 383) Effective January 1, 2014.)
  140. 7238.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Standards of Conduct [7230 - 7238] ( Article 3 added by Stats. 1978, Ch. 567. )

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    If a corporation holds assets in charitable trust, its directors (and similar functionaries) must follow the conduct standards in Article 3 for those assets.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 3. Standards of Conduct [7230 - 7238] ( Article 3 added by Stats. 1978, Ch. 567. ) ## 7238. Where a corporation holds assets in charitable trust, the conduct of its directors or of any person performing functions similar to those performed by a director, shall, in respect to the assets held in charitable trust, be governed by the standards of conduct set forth in Article 3 (commencing with Section 5230) of Chapter 2 of Part 2 for directors of nonprofit public benefit corporations. This does not limit any additional requirements which may be specifically set forth in this part regarding corporations holding assets in charitable trust. (Added by Stats. 1978, Ch. 567.)
  141. 7240.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 4. Examination by Attorney General [7240- 7240.] ( Article 4 added by Stats. 1978, Ch. 567. )

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    A corporation holding assets in charitable trust must submit to Attorney General examination, and the Attorney General may start proceedings if there is a failure to comply with the trust.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 2. Directors and Management [7210 - 7240] ( Chapter 2 added by Stats. 1978, Ch. 567. ) ## ARTICLE 4. Examination by Attorney General [7240- 7240.] ( Article 4 added by Stats. 1978, Ch. 567. ) ## 7240. A corporation holding assets in charitable trust is subject at all times to examination by the Attorney General, on behalf of the state, to ascertain to what extent, if at all, it has failed or is failing to comply with trusts it has assumed. In case of any such failure the Attorney General, in the name of the state, may institute against any person or persons the proceedings necessary to correct the failure. (Amended by Stats. 1979, Ch. 724.)
  142. 7310.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 3. Members [7310 - 7354] ( Chapter 3 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Issuance of Memberships [7310 - 7315] ( Article 1 added by Stats. 1978, Ch. 567. )

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    A nonprofit mutual benefit corporation may admit members, or it may state in its articles or bylaws that it has no members.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 3. Members [7310 - 7354] ( Chapter 3 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Issuance of Memberships [7310 - 7315] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 7310. (a) A corporation may admit persons to membership, as provided in its articles or bylaws, or may provide in its articles or bylaws that it shall have no members. In the absence of any provision in its articles or bylaws providing for members, a corporation shall have no members. (b) In the case of a corporation which has no members: (1) Any action for which there is no specific provision of this part applicable to a corporation which has no members and which would otherwise require approval by a majority of all members (Section 5033) or approval by the members (Section 5034) shall require only approval of the board, any provision of this part or the articles or bylaws to the contrary notwithstanding. (2) All rights which would otherwise vest in the members to share in a distribution upon dissolution shall vest in the directors. (c) Reference in this part to a corporation which has no members includes a corporation in which the directors are the only members. (Amended by Stats. 1984, Ch. 812, Sec. 6.5.)
  143. 7311.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 3. Members [7310 - 7354] ( Chapter 3 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Issuance of Memberships [7310 - 7315] ( Article 1 added by Stats. 1978, Ch. 567. )

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    A corporation may issue memberships, but only subject to its articles or bylaws.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 3. Members [7310 - 7354] ( Chapter 3 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Issuance of Memberships [7310 - 7315] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 7311. Subject to the articles or bylaws, memberships may be issued by a corporation for no consideration or for such consideration as is determined by the board. (Amended by Stats. 1981, Ch. 587, Sec. 30.)
  144. 7312.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 3. Members [7310 - 7354] ( Chapter 3 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Issuance of Memberships [7310 - 7315] ( Article 1 added by Stats. 1978, Ch. 567. )

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    A person generally may not hold more than one membership or any fractional membership, unless one of the listed exceptions applies.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 3. Members [7310 - 7354] ( Chapter 3 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Issuance of Memberships [7310 - 7315] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 7312. No person may hold more than one membership, and no fractional memberships may be held, except as follows: (a) Two or more persons may have an indivisible interest in a single membership when authorized by, and in a manner or under the circumstances prescribed by, the articles or bylaws subject to Section 7612. (b) If the articles or bylaws provide for classes of membership and if the articles or bylaws permit a person to be a member of more than one class, a person may hold a membership in one or more classes. (c) Any branch, division, or office of any person, which is not formed primarily to be a member, may hold a separate membership. (d) In the case of membership in an owners’ association, created in connection with any of the forms of development referred to in Section 11004.5 of the Business and Professions Code, the articles or bylaws may permit a person who owns an interest, or who has a right of exclusive occupancy, in more than one lot, parcel, area, apartment, or unit to hold a separate membership in the owners’ association for each lot, parcel, area, apartment, or unit. (e) In the case of membership in a mutual water company, as defined in Section 14300, the articles or bylaws may permit a person entitled to membership by reason of the ownership, lease, or right of occupancy of more than one lot, parcel, or other service unit to hold a separate membership in the mutual water company for each lot, parcel, or other service unit. (f) In the case of membership in a mobilehome park acquisition corporation, as described in Section 11010.8 of the Business and Professions Code, a bona fide secured party who has, pursuant to a security interest in a membership, taken title to the membership by way of foreclosure, repossession, or voluntary repossession, and who is actively attempting to resell the membership to a prospective homeowner or resident of the mobilehome park, may own more than one membership. (Amended by Stats. 2006, Ch. 538, Sec. 79. Effective January 1, 2007.)
  145. 7313.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 3. Members [7310 - 7354] ( Chapter 3 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Issuance of Memberships [7310 - 7315] ( Article 1 added by Stats. 1978, Ch. 567. )

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    A corporation may issue membership certificates, and the board may require replacement or surrender of certificates in some cases.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 3. Members [7310 - 7354] ( Chapter 3 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Issuance of Memberships [7310 - 7315] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 7313. (a) A corporation may, but is not required to, issue membership certificates. Nothing in this section shall restrict a corporation from issuing identity cards or similar devices to members which serve to identify members qualifying to use facilities or services of the corporation. (b) Membership certificates issued by corporations shall state the following on the certificate: (1) The corporation is a nonprofit mutual benefit corporation which may not make distributions to its members except upon dissolution, or, if the articles or bylaws so provide, that it may not make distributions to its members during its life or upon dissolution. (2) If there are restrictions upon the transferability, a statement that a copy of the restrictions are on file with the secretary of the corporation and are open for inspection by a member on the same basis as the records of the corporation. (c) If the membership certificates are transferable only with consent of the corporation, or if there are no membership certificates, then instead of complying with paragraph (2) of subdivision (b) the corporation may, or if there are no membership certificates, shall, give notice to the transferee, within a reasonable time after the corporation is first notified of the proposed transfer, and before the membership is transferred on the books and records of the corporation, of the information that would otherwise be provided by the legends required by paragraph (2) of subdivision (b). (d) If the articles or bylaws are amended so that any statement required by subdivision (b) upon outstanding membership certificates is no longer accurate, then the board may cancel the outstanding certificates and issue in their place new certificates conforming to the articles or bylaw amendments. (e) Where new membership certificates are issued in accordance with subdivision (d), the board may order holders of outstanding certificates to surrender and exchange them for new certificates within a reasonable time fixed by the board. The board may further provide that the holder of a certificate so ordered to be surrendered shall not be entitled to exercise any of the rights of membership until the certificate is surrendered and exchanged, but rights shall be suspended only after notice of such order is given to the holder of the certificate and only until the certificate is exchanged. The duty of surrender of any outstanding certificates may also be enforced by civil action. (Amended by Stats. 1985, Ch. 378, Sec. 4.)
  146. 7314.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 3. Members [7310 - 7354] ( Chapter 3 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Issuance of Memberships [7310 - 7315] ( Article 1 added by Stats. 1978, Ch. 567. )

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    A corporation may replace a lost, stolen, or destroyed certificate, and may require the owner to provide a bond or other adequate security. If the corporation refuses, the owner or legal representative may ask the superior court for an order requiring replacement.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 3. Members [7310 - 7354] ( Chapter 3 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Issuance of Memberships [7310 - 7315] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 7314. (a) A corporation may issue a new membership certificate or a new certificate for any security in the place of any certificate theretofore issued by it, alleged to have been lost, stolen or destroyed, and the corporation may require the owner of the lost, stolen or destroyed certificate or the owner’s legal representative to give the corporation a bond (or other adequate security) sufficient to indemnify it against any claim that may be made against it (including any expense or liability) on account of the alleged loss, theft or destruction of any such certificate or the issuance of such new certificate. (b) If a corporation refuses to issue a new membership certificate or other certificate in place of one theretofore issued by it, or by any corporation of which it is the lawful successor, alleged to have been lost, stolen or destroyed, the owner of the lost, stolen or destroyed certificate or the owner’s legal representative may bring an action in the superior court of the proper county for an order requiring the corporation to issue a new certificate in place of the one lost, stolen or destroyed. (Added by Stats. 1978, Ch. 567.)
  147. 7315.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 3. Members [7310 - 7354] ( Chapter 3 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Issuance of Memberships [7310 - 7315] ( Article 1 added by Stats. 1978, Ch. 567. )

    Verify source ↗

    A corporation may admit any person to membership, except where subdivision (b) or its articles or bylaws provide otherwise. It may not admit its subsidiary to membership.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 3. Members [7310 - 7354] ( Chapter 3 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Issuance of Memberships [7310 - 7315] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 7315. (a) Except as provided in subdivision (b), or in its articles or bylaws, a corporation may admit any person to membership. (b) A corporation may not admit its subsidiary (Section 5073) to membership. (Amended by Stats. 1979, Ch. 724.)
  148. 7320.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 3. Members [7310 - 7354] ( Chapter 3 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Transfer of Memberships [7320- 7320.] ( Article 2 added by Stats. 1978, Ch. 567. )

    Verify source ↗

    Members generally may not transfer a membership or related rights unless the articles or bylaws allow it. The articles or bylaws may also let the board set transfer rules, and later transfer restrictions are not binding on earlier memberships unless those holders voted for the restriction.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 3. Members [7310 - 7354] ( Chapter 3 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Transfer of Memberships [7320- 7320.] ( Article 2 added by Stats. 1978, Ch. 567. ) ## 7320. Subject to Section 7613: (a) Unless the articles or bylaws otherwise provide: (1) No member may transfer a membership or any right arising therefrom; and (2) Subject to the provisions of subdivision (b), all rights as a member of the corporation cease upon the member’s death or dissolution. (b) The articles or bylaws may provide for, or may authorize the board to provide for, the transfer of memberships, or of memberships within any class or classes, with or without restriction or limitation, including transfer upon the death, dissolution, merger, or reorganization of a member. (c) Where transfer rights have been provided, no restriction of them shall be binding with respect to memberships issued prior to the adoption of the restriction, unless the holders of such memberships voted in favor of the restriction. (Added by Stats. 1978, Ch. 567.)
  149. 7340.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 3. Members [7310 - 7354] ( Chapter 3 added by Stats. 1978, Ch. 567. ) ## ARTICLE 4. Termination of Memberships [7340 - 7341] ( Article 4 added by Stats. 1978, Ch. 567. )

    Verify source ↗

    A member may resign at any time, but the bylaws or articles may require reasonable notice. Resigning does not erase certain existing payment or contract obligations, and a fixed-term membership expires when its term ends unless renewed.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 3. Members [7310 - 7354] ( Chapter 3 added by Stats. 1978, Ch. 567. ) ## ARTICLE 4. Termination of Memberships [7340 - 7341] ( Article 4 added by Stats. 1978, Ch. 567. ) ## 7340. (a) A member may resign from membership at any time, although the articles or bylaws may require reasonable notice before the resignation is effective. (b) This section shall not relieve the resigning member from any obligation for charges incurred, services or benefits actually rendered, dues, assessments or fees, or arising from contract, a condition to ownership of land, an obligation arising out of the ownership of land, or otherwise, and this section shall not diminish any right of the corporation to enforce any such obligation or obtain damages for its breach. (c) A membership issued for a period of time shall expire when such period of time has elapsed unless the membership is renewed. (Amended by Stats. 1979, Ch. 724.)
  150. 7341.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 3. Members [7310 - 7354] ( Chapter 3 added by Stats. 1978, Ch. 567. ) ## ARTICLE 4. Termination of Memberships [7340 - 7341] ( Article 4 added by Stats. 1978, Ch. 567. )

    Verify source ↗

    A member cannot be expelled, suspended, or terminated except through procedures that meet this section’s requirements.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 3. Members [7310 - 7354] ( Chapter 3 added by Stats. 1978, Ch. 567. ) ## ARTICLE 4. Termination of Memberships [7340 - 7341] ( Article 4 added by Stats. 1978, Ch. 567. ) ## 7341. (a) No member may be expelled or suspended, and no membership or memberships may be terminated or suspended, except according to procedures satisfying the requirements of this section. An expulsion, termination or suspension not in accord with this section shall be void and without effect. (b) Any expulsion, suspension, or termination must be done in good faith and in a fair and reasonable manner. Any procedure which conforms to the requirements of subdivision (c) is fair and reasonable, but a court may also find other procedures to be fair and reasonable when the full circumstances of the suspension, termination, or expulsion are considered. (c) A procedure is fair and reasonable when: (1) The provisions of the procedure have been set forth in the articles or bylaws, or copies of such provisions are sent annually to all the members as required by the articles or bylaws; (2) It provides the giving of 15 days’ prior notice of the expulsion, suspension or termination and the reasons therefor; and (3) It provides an opportunity for the member to be heard, orally or in writing, not less than five days before the effective date of the expulsion, suspension or termination by a person or body authorized to decide that the proposed expulsion, termination or suspension not take place. (d) Any notice required under this section may be given by any method reasonably calculated to provide actual notice. Any notice given by mail must be given by first-class or registered mail sent to the last address of the members shown on the corporation’s records. (e) Any action challenging an expulsion, suspension or termination of membership, including any claim alleging defective notice, must be commenced within one year after the date of the expulsion, suspension or termination. In the event such an action is successful the court may order any relief, including reinstatement, it finds equitable under the circumstances, but no vote of the members or of the board may be set aside solely because a person was at the time of the vote wrongfully excluded by virtue of the challenged expulsion, suspension or termination, unless the court finds further that the wrongful expulsion, suspension or termination was in bad faith and for the purpose, and with the effect, of wrongfully excluding the member from the vote or from the meeting at which the vote took place, so as to affect the outcome of the vote. (f) This section governs only the procedures for expulsion, suspension or termination and not the substantive grounds therefor. An expulsion, suspension or termination based upon substantive grounds which violate contractual or other rights of the member or are otherwise unlawful is not made valid by compliance with this section. (g) A member who is expelled or suspended or whose membership is terminated shall be liable for any charges incurred, services or benefits actually rendered, dues, assessments or fees incurred before the expulsion, suspension or termination or arising from contract or otherwise. (Amended by Stats. 1996, Ch. 589, Sec. 27. Effective January 1, 1997.)
  151. 7350.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 3. Members [7310 - 7354] ( Chapter 3 added by Stats. 1978, Ch. 567. ) ## ARTICLE 5. Rights and Obligations of Members and Creditors [7350 - 7354] ( Article 5 added by Stats. 1978, Ch. 567. )

    Verify source ↗

    Members are not personally liable for a corporation’s debts or obligations just because they are members.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 3. Members [7310 - 7354] ( Chapter 3 added by Stats. 1978, Ch. 567. ) ## ARTICLE 5. Rights and Obligations of Members and Creditors [7350 - 7354] ( Article 5 added by Stats. 1978, Ch. 567. ) ## 7350. (a) A member of a corporation is not, as such, personally liable for the debts, liabilities, or obligations of the corporation. (b) No person is liable for any obligation arising from membership unless the person was admitted to membership upon the person’s application or with the person’s consent. (c) The ownership of an interest in real property, when a condition of its ownership is membership in a corporation, shall be considered consent to such membership for the purpose of this section. (Added by Stats. 1978, Ch. 567.)
  152. 7351.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 3. Members [7310 - 7354] ( Chapter 3 added by Stats. 1978, Ch. 567. ) ## ARTICLE 5. Rights and Obligations of Members and Creditors [7350 - 7354] ( Article 5 added by Stats. 1978, Ch. 567. )

    Verify source ↗

    A corporation may charge members dues, assessments, or fees if its articles or bylaws allow it, and a member may avoid liability by promptly resigning after learning of them unless an exception applies.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 3. Members [7310 - 7354] ( Chapter 3 added by Stats. 1978, Ch. 567. ) ## ARTICLE 5. Rights and Obligations of Members and Creditors [7350 - 7354] ( Article 5 added by Stats. 1978, Ch. 567. ) ## 7351. A corporation may levy dues, assessments, or fees upon its members pursuant to its articles or bylaws, but a member upon learning of them may avoid liability for them by promptly resigning from membership, except where the member is liable for them by contract, as a condition to ownership of an interest in real property, as an obligation arising out of the ownership of an interest in real property, or otherwise. Article or bylaw provisions authorizing such dues, assessments or fees do not, of themselves, create such liability. (Amended by Stats. 1979, Ch. 724.)
  153. 7352.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 3. Members [7310 - 7354] ( Chapter 3 added by Stats. 1978, Ch. 567. ) ## ARTICLE 5. Rights and Obligations of Members and Creditors [7350 - 7354] ( Article 5 added by Stats. 1978, Ch. 567. )

    Verify source ↗

    A person holding a membership in a fiduciary or representative capacity is not personally liable for certain unpaid membership-related amounts; the estate and funds may still be liable.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 3. Members [7310 - 7354] ( Chapter 3 added by Stats. 1978, Ch. 567. ) ## ARTICLE 5. Rights and Obligations of Members and Creditors [7350 - 7354] ( Article 5 added by Stats. 1978, Ch. 567. ) ## 7352. A person holding a membership as pledgee or a membership as executor, administrator, guardian, trustee, receiver or in any representative or fiduciary capacity is not personally liable for any unpaid balance of the purchase price of the membership, or for any amount owing to the corporation by the member, because the membership is so held, but the estate and funds in the hands of such fiduciary or representative are liable and the membership subject to sale therefor. (Amended by Stats. 1983, Ch. 1085, Sec. 5.1.)
  154. 7353.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 3. Members [7310 - 7354] ( Chapter 3 added by Stats. 1978, Ch. 567. ) ## ARTICLE 5. Rights and Obligations of Members and Creditors [7350 - 7354] ( Article 5 added by Stats. 1978, Ch. 567. )

    Verify source ↗

    A creditor generally cannot start an action to reach a member’s liability to the corporation unless the creditor has a final judgment and unsatisfied execution, or the proceedings would be useless.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 3. Members [7310 - 7354] ( Chapter 3 added by Stats. 1978, Ch. 567. ) ## ARTICLE 5. Rights and Obligations of Members and Creditors [7350 - 7354] ( Article 5 added by Stats. 1978, Ch. 567. ) ## 7353. (a) No action shall be brought by or on behalf of any creditor to reach and apply the liability, if any, of a member to the corporation to pay the amount due on such member’s membership or otherwise due to the corporation unless final judgment has been rendered in favor of the creditor against the corporation and execution has been returned unsatisfied in whole or in part or unless such proceedings would be useless. (b) All creditors of the corporation, with or without reducing their claims to judgment, may intervene in any such creditor’s action to reach and apply unpaid amounts due the corporation and any or all members who owe amounts to the corporation may be joined in such action. Several judgments may be rendered for and against the parties to the action or in favor of a receiver for the benefit of the respective parties thereto. (c) All amounts paid by any member in any such action shall be credited on the unpaid balance due the corporation by such member. (Added by Stats. 1978, Ch. 567.)
  155. 7354.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 3. Members [7310 - 7354] ( Chapter 3 added by Stats. 1978, Ch. 567. ) ## ARTICLE 5. Rights and Obligations of Members and Creditors [7350 - 7354] ( Article 5 added by Stats. 1978, Ch. 567. )

    Verify source ↗

    This section says the chapter does not limit existing fraud- or illegality-based rights and remedies tied to the issue or sale of memberships or securities.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 3. Members [7310 - 7354] ( Chapter 3 added by Stats. 1978, Ch. 567. ) ## ARTICLE 5. Rights and Obligations of Members and Creditors [7350 - 7354] ( Article 5 added by Stats. 1978, Ch. 567. ) ## 7354. Nothing in this part shall be construed as in derogation of any rights or remedies which any creditor or member may have against any promoter, member, director, officer or the corporation because of participation in any fraud or illegality practiced upon such creditor or member by any such person or by the corporation in connection with the issue or sale of memberships or securities or in derogation of any rights which the corporation may have by rescission, cancellation or otherwise because of any fraud or illegality practiced on it by any such person in connection with the issue or sale of memberships or securities. (Added by Stats. 1978, Ch. 567.)
  156. 7410.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 4. Distributions [7410 - 7420] ( Chapter 4 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Limitations [7410 - 7414] ( Article 1 added by Stats. 1978, Ch. 567. )

    Verify source ↗

    This chapter does not apply to winding up and dissolution proceedings under Chapters 15, 16, and 17.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 4. Distributions [7410 - 7420] ( Chapter 4 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Limitations [7410 - 7414] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 7410. This chapter does not apply to any proceeding for winding up and dissolution of corporations under Chapters 15 (commencing with Section 8510), 16 (commencing with Section 8610), and 17 (commencing with Section 8710). (Added by Stats. 1978, Ch. 567.)
  157. 7411.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 4. Distributions [7410 - 7420] ( Chapter 4 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Limitations [7410 - 7414] ( Article 1 added by Stats. 1978, Ch. 567. )

    Verify source ↗

    A corporation generally may not make distributions unless it is dissolving, but it may purchase or redeem memberships if it meets the stated requirements and any extra restrictions.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 4. Distributions [7410 - 7420] ( Chapter 4 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Limitations [7410 - 7414] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 7411. (a) Except as provided in subdivision (b), no corporation shall make any distribution except upon dissolution. (b) A corporation may, subject to meeting the requirements of Sections 7412 and 7413 and any additional restrictions authorized by Section 7414, purchase or redeem memberships. (Amended by Stats. 1979, Ch. 724.)
  158. 7412.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 4. Distributions [7410 - 7420] ( Chapter 4 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Limitations [7410 - 7414] ( Article 1 added by Stats. 1978, Ch. 567. )

    Verify source ↗

    A corporation and its subsidiaries must not make a distribution if doing so would likely leave them unable to pay liabilities as they mature.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 4. Distributions [7410 - 7420] ( Chapter 4 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Limitations [7410 - 7414] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 7412. Neither a corporation nor any of its subsidiaries shall make a distribution if the corporation or the subsidiary making the distribution is, or as a result thereof would be, likely to be unable to meet its liabilities (except those whose payment is otherwise adequately provided for) as they mature. (Added by Stats. 1978, Ch. 567.)
  159. 7413.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 4. Distributions [7410 - 7420] ( Chapter 4 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Limitations [7410 - 7414] ( Article 1 added by Stats. 1978, Ch. 567. )

    Verify source ↗

    A corporation and its subsidiaries may not buy or redeem a parent or subsidiary membership when the corporation’s articles contain the specified provision and the buyer is likely unable to meet the resulting obligations.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 4. Distributions [7410 - 7420] ( Chapter 4 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Limitations [7410 - 7414] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 7413. Neither a corporation nor any of its subsidiaries shall purchase or redeem a membership of the parent or subsidiary if the articles of the corporation contain a provision authorized by subparagraph (B) of paragraph (4) of subdivision (a) of Section 7132 and such corporation or the subsidiary making the purchase or redemption is, or as a result thereof would be, likely to be unable to meet the obligations resulting from such article provision. (Amended by Stats. 2022, Ch. 617, Sec. 60. (SB 1202) Effective January 1, 2023.)
  160. 7414.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 4. Distributions [7410 - 7420] ( Chapter 4 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Limitations [7410 - 7414] ( Article 1 added by Stats. 1978, Ch. 567. )

    Verify source ↗

    The chapter does not bar extra limits on buying or redeeming a membership if those limits are set in the corporation’s articles, bylaws, or an agreement with the corporation.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 4. Distributions [7410 - 7420] ( Chapter 4 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. Limitations [7410 - 7414] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 7414. Nothing in this chapter prohibits additional restrictions upon the purchase or redemption of a membership by provision in a corporation’s articles or bylaws or agreement entered into by the corporation. (Added by Stats. 1978, Ch. 567.)
  161. 7420.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 4. Distributions [7410 - 7420] ( Chapter 4 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Liability of Members [7420- 7420.] ( Article 2 added by Stats. 1978, Ch. 567. )

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    A person who knowingly receives a prohibited distribution must repay it with judgment-rate interest, and the repayment can run to the corporation, a head organization, or qualifying creditors depending on the violation.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 4. Distributions [7410 - 7420] ( Chapter 4 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Liability of Members [7420- 7420.] ( Article 2 added by Stats. 1978, Ch. 567. ) ## 7420. (a) Any person who with knowledge of facts indicating the impropriety thereof receives any distribution, including a payment in redemption of a membership, prohibited by this chapter is liable to the corporation for the amount so received by the person with interest thereon at the legal rate on judgments until paid. (b) Any person who with knowledge of facts indicating the impropriety thereof receives any distribution, including a payment in redemption of a membership, prohibited by this chapter is liable to the corporation for the benefit of the head organization, or of all of the creditors entitled to institute an action under subdivision (c), for the amount so received by the person with interest thereon at the legal rate on judgments until paid, but not exceeding the obligations of the corporation owed to the head organization at the time of the violation, or the liabilities of the corporation owed to nonconsenting creditors at the time of the violation, as the case may be. (c) Suit may be brought in the name of the corporation to enforce the liability (1) to creditors arising under subdivision (b) for a violation of Section 7411 or 7412 against any or all persons liable by any one or more creditors of the corporation whose debts or claims arose prior to the time of the distribution and who have not consented thereto, whether or not they have reduced their claims to judgment, or (2) to the head organization arising under subdivision (b) for a violation of Section 7413 against any or all persons liable by any head organization which pursuant to the corporation’s articles is entitled to a distribution of assets upon dissolution. (d) Any person sued under subdivision (b) may implead all other persons liable under subdivision (b) and may in the absence of fraud by the moving party compel contribution, either in that action or in an independent action against persons not joined in that action. (e) Nothing contained in this section affects any liability which any person may have under the Uniform Voidable Transactions Act (Chapter 1 (commencing with Section 3439) of Title 2 of Part 2 of Division 4 of the Civil Code). (Amended by Stats. 2015, Ch. 44, Sec. 20. (SB 161) Effective January 1, 2016.)
  162. 7510.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [7510 - 7517] ( Article 1 added by Stats. 1978, Ch. 567. )

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    This section sets rules for nonprofit mutual benefit corporation member meetings, including where meetings may be held, when regular meetings must be held, and when remote participation is allowed.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [7510 - 7517] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 7510. (a) Meetings of members may be held at a place within or without this state as may be stated in or fixed in accordance with the bylaws. If no other place is stated or so fixed, meetings of members shall be held at the principal office of the corporation. Subject to any limitations in the articles or bylaws of the corporation, if authorized by the board of directors in its sole discretion, and subject to those guidelines and procedures as the board of directors may adopt, members not physically present in person (or, if proxies are allowed, by proxy) at a meeting of members may, by electronic transmission by and to the corporation (Sections 20 and 21), electronic video screen communication, conference telephone, or other means of remote communication, participate in a meeting of members, be deemed present in person (or, if proxies are allowed, by proxy), and vote at a meeting of members, subject to subdivision (f). (b) A regular meeting of members shall be held on a date and time, and with the frequency stated in or fixed in accordance with the bylaws, but in any event in each year in which directors are to be elected at that meeting for the purpose of conducting such election, and to transact any other proper business which may be brought before the meeting. (c) If a corporation with members is required by subdivision (b) to hold a regular meeting and fails to hold the regular meeting for a period of 60 days after the date designated therefor or, if no date has been designated, for a period of 15 months after the formation of the corporation or after its last regular meeting, or if the corporation fails to hold a written ballot for a period of 60 days after the date designated therefor, then the superior court of the proper county may summarily order the meeting to be held or the ballot to be conducted upon the application of a member or the Attorney General, after notice to the corporation giving it an opportunity to be heard. (d) The votes represented, either in person (or, if proxies are allowed, by proxy), at a meeting called or by written ballot ordered pursuant to subdivision (c), and entitled to be cast on the business to be transacted shall constitute a quorum, notwithstanding any provision of the articles or bylaws or in this part to the contrary. The court may issue such orders as may be appropriate, including, without limitation, orders designating the time and place of the meeting, the record date for determination of members entitled to vote, and the form of notice of the meeting. (e) Special meetings of members for any lawful purpose may be called by the board, the chairperson of the board, the president, or such other persons, if any, as are specified in the bylaws. In addition, special meetings of members for any lawful purpose may be called by 5 percent or more of the members. (f) A meeting of the members may be conducted, in whole or in part, by electronic transmission by and to the corporation, electronic video screen communication, conference telephone, or other means of remote communication if the corporation implements reasonable measures: (1) to provide members and proxyholders, if proxies are allowed, a reasonable opportunity to participate in the meeting and to vote on matters submitted to the members, including an opportunity to read or hear the proceedings of the meeting concurrently with those proceedings, (2) if any member or proxyholder, if proxies are allowed, votes or takes other action at the meeting by means of electronic transmission to the corporation, electronic video screen communication, conference telephone, or other means of remote communication, to maintain a record of that vote or action in its books and records, and (3) to verify that each person who has voted remotely is a member or proxyholder, if proxies are allowed. A corporation shall not conduct a meeting of members solely by electronic transmission by and to the corporation, electronic video screen communication, conference telephone, or other means of remote communication unless one or more of the following conditions apply: (A) all of the members consent; (B) the board determines it is necessary or appropriate because of an emergency, as defined in paragraph (5) of subdivision (m) of Section 7140; or (C) notwithstanding the absence of consent from all members pursuant to (A) or subdivision (b) of Section 20, the meeting includes a live audiovisual feed for the duration of the meeting. A corporation holding a meeting pursuant to (C) may offer, in addition to remote audiovisual feed, an audio-only means by which a member or proxyholder may participate provided that the choice between participating via audiovisual or via audio-only means is made by the member or proxyholder and the corporation does not impose any barriers to either mode of participation. A de minimis disruption of an audio or audiovisual feed does not require a corporation to end a meeting under, or render the corporation out of compliance with, this subdivision. (Amended by Stats. 2025, Ch. 67, Sec. 40. (AB 1170) Effective January 1, 2026.)
  163. 7511.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [7510 - 7517] ( Article 1 added by Stats. 1978, Ch. 567. )

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    This section requires written notice for members’ meetings, sets timing rules, says what the notice must include, and limits adjournments and special-meeting business.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [7510 - 7517] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 7511. (a) Whenever members are required or permitted to take any action at a meeting, a written notice of the meeting shall be given not less than 10 nor more than 90 days before the date of the meeting to each member who, on the record date for notice of the meeting, is entitled to vote thereat; provided, however, that if notice is given by mail, and the notice is not mailed by first-class, registered, or certified mail, that notice shall be given not less than 20 days before the meeting. Subject to subdivision (f), and subdivision (b) of Section 7512, the notice shall state the place, date and time of the meeting, the means of electronic transmission by and to the corporation (Sections 20 and 21), electronic video screen communication, conference telephone, or other means of remote communication, if any, by which members may participate in that meeting, and (1) in the case of a special meeting, the general nature of the business to be transacted, and no other business may be transacted, or (2) in the case of the regular meeting, those matters which the board, at the time the notice is given, intends to present for action by the members, but, except as provided in subdivision (b) of Section 7512, any proper matter may be presented at the meeting for the action. The notice of any meeting at which directors are to be elected shall include the names of all those who are nominees at the time the notice is given to members. (b) (1) Notice of a members’ meeting or any report shall be given personally, by electronic transmission by a corporation, or by mail or other means of written communication, addressed to a member at the address of the member appearing on the books of the corporation or given by the member to the corporation for purpose of notice, or if no such address appears or is given, at the place where the principal office of the corporation is located or by publication at least once in a newspaper of general circulation in the county in which the principal office is located. Notwithstanding the foregoing, the notice of a members’ meeting or any report may be sent by electronic communication or other means of remote communication if the board determines it is necessary or appropriate because of an emergency, as defined in paragraph (5) of subdivision (m) of Section 7140. An affidavit of giving of any notice or report as permitted because of an emergency or otherwise in accordance with the provisions of this part, executed by the secretary, assistant secretary, or any transfer agent, shall be prima facie evidence of the giving of the notice or report. (2) If any notice or report addressed to the member at the address of the member appearing on the books of the corporation is returned to the corporation by the United States Postal Service marked to indicate that the United States Postal Service is unable to deliver the notice or report to the member at the address, all future notices or reports shall be deemed to have been duly given without further mailing if the same shall be available for the member upon written demand of the member at the principal office of the corporation for a period of one year from the date of the giving of the notice or report to all other members. (3) (A) Notice given by electronic transmission by the corporation under this subdivision shall be valid only if it complies with Section 20. Notwithstanding the foregoing, notice shall not be given by electronic transmission by the corporation under this subdivision after either of the following: (i) The corporation is unable to deliver two consecutive notices to the member by that means. (ii) The inability to so deliver the notices to the member becomes known to the secretary, any assistant secretary, the transfer agent, or other person responsible for the giving of the notice. (B) This paragraph shall not apply if notices are provided by electronic communication or other means of remote communication as permitted because of an emergency. (c) Upon request in writing to the corporation addressed to the attention of the chairperson of the board, president, vice president, or secretary by any person (other than the board) entitled to call a special meeting of members, the officer forthwith shall cause notice to be given to the members entitled to vote that a meeting will be held at a time fixed by the board not less than 35 nor more than 90 days after the receipt of the request. If the corporation is a common interest development, as defined in Section 4100 of the Civil Code, the corporation shall cause notice to be given to the members entitled to vote that a meeting will be held at a time fixed by the board not less than 35 nor more than 150 days after receipt of the request. If the notice is not given within 20 days after receipt of the request, the persons entitled to call the meeting may give the notice or the superior court of the proper county shall summarily order the giving of the notice, after notice to the corporation giving it an opportunity to be heard. The court may issue such orders as may be appropriate, including, without limitation, orders designating the time and place of the meeting, the record date for determination of members entitled to vote, and the form of notice. (d) When a members’ meeting is adjourned to another time or place, unless the bylaws otherwise require and except as provided in this subdivision, notice need not be given of the adjourned meeting if the time and place thereof (or the means of electronic transmission by and to the corporation or electronic video screen communication, conference telephone, or other means of remote communication, if any, by which members may participate) are announced at the meeting at which the adjournment is taken. No meeting may be adjourned for more than 45 days. At the adjourned meeting the corporation may transact any business which might have been transacted at the original meeting. If after the adjournment a new record date is fixed for notice or voting, a notice of the adjourned meeting shall be given to each member who, on the record date for notice of the meeting, is entitled to vote at the meeting. (e) The transactions of any meeting of members however called and noticed, and wherever held, are as valid as though had at a meeting duly held after regular call and notice, if a quorum is present either in person or by proxy, and if, either before or after the meeting, each of the persons entitled to vote, not present in person (or, if proxies are allowed, by proxy), provides a waiver of notice or consent to the holding of the meeting or an approval of the minutes thereof in writing. All such waivers, consents, and approvals shall be filed with the corporate records or made a part of the minutes of the meeting. Attendance of a person at a meeting shall constitute a waiver of notice of and presence at the meeting, except when the person objects, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened and except that attendance at a meeting is not a waiver of any right to object to the consideration of matters required by this part to be included in the notice but not so included, if the objection is expressly made at the meeting. Neither the business to be transacted at nor the purpose of any regular or special meeting of members need be specified in any written waiver of notice, consent to the holding of the meeting or approval of the minutes thereof, unless otherwise provided in the articles or bylaws, except as provided in subdivision (f). (f) Any approval of the members required under Section 7222, 7224, 7233, 7812, 8610, or 8719, other than unanimous approval by those entitled to vote, shall be valid only if the general nature of the proposal so approved was stated in the notice of meeting or in any written waiver of notice. (g) A court may find that notice not given in conformity with this section is still valid, if it was given in a fair and reasonable manner. (Amended by Stats. 2022, Ch. 617, Sec. 62. (SB 1202) Effective January 1, 2023.)
  164. 7512.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [7510 - 7517] ( Article 1 added by Stats. 1978, Ch. 567. )

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    This section sets quorum and voting rules for members’ meetings, allows bylaws to change quorum in some cases, and lets meetings be adjourned when quorum is missing.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [7510 - 7517] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 7512. (a) One-third of the voting power, represented in person or by proxy, shall constitute a quorum at a meeting of members, but, subject to subdivisions (b) and (c), a bylaw may set a different quorum. Any bylaw amendment to increase the quorum may be adopted only by approval of the members (Section 5034). If a quorum is present, the affirmative vote of the majority of the voting power represented at the meeting, entitled to vote, and voting on any matter shall be the act of the members unless the vote of a greater number or voting by classes is required by this part or the articles or bylaws. (b) Where a bylaw authorizes a corporation to conduct a meeting with a quorum of less than one-third of the voting power, then the only matters that may be voted upon at any regular meeting actually attended, in person or by proxy, by less than one-third of the voting power are matters notice of the general nature of which was given, pursuant to the first sentence of subdivision (a) of Section 7511. (c) Subject to subdivision (b), the members present at a duly called or held meeting at which a quorum is present may continue to transact business until adjournment notwithstanding the withdrawal of enough members to leave less than a quorum, if any action taken (other than adjournment) is approved by at least a majority of the members required to constitute a quorum or, if required by this division, or by the articles or the bylaws, the vote of the greater number or voting by classes. (d) In the absence of a quorum, any meeting of members may be adjourned from time to time by the vote of a majority of the votes represented either in person or by proxy, but no other business may be transacted, except as provided in subdivision (c). (e) For an election of directors of a corporation that is a common interest development, and in the absence of meeting quorum as required by the association’s governing documents or this section, unless a lower quorum for a reconvened meeting is authorized by an association’s governing documents, the corporation may adjourn the meeting to a date at least 20 days after the adjourned meeting, at which time the quorum required for purposes of a reconvened meeting to elect directors shall be 20 percent of the association’s members, voting in person, by proxy, or by secret ballot. (Amended by Stats. 2024, Ch. 401, Sec. 2. (AB 2460) Effective January 1, 2025.)
  165. 7513.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [7510 - 7517] ( Article 1 added by Stats. 1978, Ch. 567. )

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    This section lets members act without a meeting by written ballot if the corporation sends ballots to all voting members and the vote meets quorum and approval rules.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [7510 - 7517] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 7513. (a) Subject to subdivision (e), and unless prohibited in the articles or bylaws, any action which may be taken at any regular or special meeting of members may be taken without a meeting if the corporation distributes a written ballot to every member entitled to vote on the matter. Unless otherwise provided by the articles or bylaws and if approved by the board of directors, that ballot and any related material may be sent by electronic transmission by the corporation (Section 20) and responses may be returned to the corporation by electronic transmission to the corporation (Section 21). That ballot shall set forth the proposed action, provide an opportunity to specify approval or disapproval of any proposal, and provide a reasonable time within which to return the ballot to the corporation. (b) Approval by written ballot pursuant to this section shall be valid only when the number of votes cast by ballot within the time period specified equals or exceeds the quorum required to be present at a meeting authorizing the action, and the number of approvals equals or exceeds the number of votes that would be required to approve at a meeting at which the total number of votes cast was the same as the number of votes cast by ballot. (c) Ballots shall be solicited in a manner consistent with the requirements of subdivision (b) of Section 7511 and Section 7514. All such solicitations shall indicate the number of responses needed to meet the quorum requirement and, with respect to ballots other than for the election of directors, shall state the percentage of approvals necessary to pass the measure submitted. The solicitation must specify the time by which the ballot must be received in order to be counted. (d) Unless otherwise provided in the articles or bylaws, a written ballot may not be revoked. (e) Directors may be elected by written ballot under this section, where authorized by the articles or bylaws, except that election by written ballot may not be authorized where the directors are elected by cumulative voting pursuant to Section 7615. (f) When directors are to be elected by written ballot and the articles or bylaws prescribe a nomination procedure, the procedure may provide for a date for the close of nominations prior to the printing and distributing of the written ballots. (Amended by Stats. 2004, Ch. 254, Sec. 26. Effective January 1, 2005.)
  166. 7514.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [7510 - 7517] ( Article 1 added by Stats. 1978, Ch. 567. )

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    Proxy forms and written ballots sent to enough members must let people choose approval or disapproval, and withheld director votes must not be counted for or against a director.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [7510 - 7517] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 7514. (a) Any form of proxy or written ballot distributed to 10 or more members of a corporation with 100 or more members shall afford an opportunity on the proxy or form of written ballot to specify a choice between approval and disapproval of each matter or group of related matters intended, at the time the written ballot or proxy is distributed, to be acted upon at the meeting for which the proxy is solicited or by such written ballot, and shall provide, subject to reasonable specified conditions, that where the person solicited specifies a choice with respect to any such matter the vote shall be cast in accordance therewith. (b) In any election of directors, any form of proxy or written ballot in which the directors to be voted upon are named therein as candidates and which is marked by a member “withhold” or otherwise marked in a manner indicating that the authority to vote for the election of directors is withheld shall not be voted either for or against the election of a director. (c) Failure to comply with this section shall not invalidate any corporate action taken, but may be the basis for challenging any proxy at a meeting or written ballot and the superior court may compel compliance therewith at the suit of any member. (Amended by Stats. 1979, Ch. 724.)
  167. 7515.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [7510 - 7517] ( Article 1 added by Stats. 1978, Ch. 567. )

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    If a corporation cannot practically hold a meeting or obtain consent as required, the superior court may order a meeting, written ballot, or other voting method, and the court must set fair notice procedures.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [7510 - 7517] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 7515. (a) If for any reason it is impractical or unduly difficult for any corporation to call or conduct a meeting of its members, delegates or directors, or otherwise obtain their consent, in the manner prescribed by its articles or bylaws, or this part, then the superior court of the proper county, upon petition of a director, officer, delegate or member, may order that such a meeting be called or that a written ballot or other form of obtaining the vote of members, delegates or directors be authorized, in such a manner as the court finds fair and equitable under the circumstances. (b) The court shall, in an order issued pursuant to this section, provide for a method of notice reasonably designed to give actual notice to all parties who would be entitled to notice of a meeting held pursuant to the articles, bylaws and this part, whether or not the method results in actual notice to every such person, or conforms to the notice requirements that would otherwise apply. In a proceeding under this section the court may determine who the members or directors are. (c) The order issued pursuant to this section may dispense with any requirement relating to the holding of and voting at meetings or obtaining of votes, including any requirement as to quorums or as to the number or percentage of votes needed for approval, that would otherwise be imposed by the articles, bylaws, or this part. (d) Wherever practical any order issued pursuant to this section shall limit the subject matter of the meetings or other forms of consent authorized to items, including amendments to the articles or bylaws, the resolution of which will or may enable the corporation to continue managing its affairs without further resort to this section; provided, however, that an order under this section may also authorize the obtaining of whatever votes and approvals are necessary for the dissolution, merger, sale of assets or reorganization of the corporation. (e) Any meeting or other method of obtaining the vote of members, delegates or directors conducted pursuant to an order issued under this section, and which complies with all the provisions of such order, is for all purposes a valid meeting or vote, as the case may be, and shall have the same force and effect as if it complied with every requirement imposed by the articles, bylaws, and this part. (Amended by Stats. 1986, Ch. 766, Sec. 31.)
  168. 7516.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [7510 - 7517] ( Article 1 added by Stats. 1978, Ch. 567. )

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    Members may take actions without a meeting if all members consent in writing.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [7510 - 7517] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 7516. Any action required or permitted to be taken by the members may be taken without a meeting, if all members shall individually or collectively consent in writing to the action. The written consent or consents shall be filed with the minutes of the proceedings of the members. The action by written consent shall have the same force and effect as the unanimous vote of the members. (Added by Stats. 1981, Ch. 587, Sec. 33.)
  169. 7517.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [7510 - 7517] ( Article 1 added by Stats. 1978, Ch. 567. )

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    A corporation acting in good faith may accept or reject ballots, consents, waivers, and proxy appointments based on signature and authority checks.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 1. General Provisions [7510 - 7517] ( Article 1 added by Stats. 1978, Ch. 567. ) ## 7517. (a) If the name signed on a ballot, consent, waiver, or proxy appointment corresponds to the name of a member, the corporation if acting in good faith is entitled to accept the ballot, consent, waiver or proxy appointment and give it effect as the act of the member. (b) If the name signed on a ballot, consent, waiver, or proxy appointment does not correspond to the record name of a member, the corporation if acting in good faith is nevertheless entitled to accept the ballot, consent, waiver, or proxy appointment and give it effect as the act of the member if any of the following occur: (1) The member is an entity and the name signed purports to be that of an officer or agent of the entity. (2) The name signed purports to be that of an attorney-in-fact of the member and if the corporation requests, evidence acceptable to the corporation of the signatory’s authority to sign for the member has been presented with respect to the ballot, consent, waiver, or proxy appointment. (3) Two or more persons hold the membership as cotenants or fiduciaries and the name signed purports to be the name of at least one of the coholders and the person signing appears to be acting on behalf of all the coholders. (4) The name signed purports to be that of an administrator, executor, guardian, or conservator representing the member and, if the corporation requests, evidence of fiduciary status acceptable to the corporation has been presented with respect to the ballot, consent, waiver, or proxy appointment. (5) The name signed purports to be that of a receiver or trustee in bankruptcy of the member, and, if the corporation requests, evidence of this status acceptable to the corporation has been presented with respect to the ballot, consent, waiver, or proxy appointment. (c) The corporation is entitled to reject a ballot, consent, waiver, or proxy appointment if the secretary or other officer or agent authorized to tabulate votes, acting in good faith, has a reasonable basis for doubt concerning the validity of the signature or the signatory’s authority to sign for the member. (d) The corporation and any officer or agent thereof who accepts or rejects a ballot, consent, waiver, or proxy appointment in good faith and in accordance with the standards of this section shall not be liable in damages to the member for the consequences of the acceptance or rejection. (e) Corporate action based on the acceptance or rejection of a ballot, consent, waiver, or proxy appointment under this section is valid unless a court of competent jurisdiction determines otherwise. (Added by Stats. 1996, Ch. 589, Sec. 29. Effective January 1, 1997.)
  170. 7520.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Additional Provisions Relating to Election of Directors [7520 - 7527] ( Article 2 added by Stats. 1978, Ch. 567. )

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    A nonprofit corporation must make reasonable nomination and election procedures available to members for member-elected directors.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Additional Provisions Relating to Election of Directors [7520 - 7527] ( Article 2 added by Stats. 1978, Ch. 567. ) ## 7520. (a) As to directors elected by members, there shall be available to the members reasonable nomination and election procedures given the nature, size and operations of the corporation. (b) If a corporation complies with all of the provisions of Sections 7521, 7522, 7523, and 7524 applicable to a corporation with the same number of members, the nomination and election procedures of that corporation, shall be deemed reasonable. However, those sections do not prescribe the exclusive means of making available to the members reasonable procedures for nomination and election of directors. A corporation may make available to the members other reasonable nomination and election procedures given the nature, size, and operations of the corporation. (c) Subject to the provisions of subdivisions (a), (b), and (d) of Section 7616, the superior court of the proper county shall enforce the provisions of this section. (Amended by Stats. 1996, Ch. 589, Sec. 30. Effective January 1, 1997.)
  171. 7521.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Additional Provisions Relating to Election of Directors [7520 - 7527] ( Article 2 added by Stats. 1978, Ch. 567. )

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    A nonprofit corporation with 500 or more members may allow qualified people to be nominated for the board in specified ways.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Additional Provisions Relating to Election of Directors [7520 - 7527] ( Article 2 added by Stats. 1978, Ch. 567. ) ## 7521. A corporation with 500 or more members may provide that, except for directors who are elected as authorized by Section 7152 or 7153, and except as provided in Section 7522, any person who is qualified to be elected to the board of directors of the corporation may be nominated: (a) By any method authorized by the bylaws, or if no method is set forth in the bylaws by any method authorized by the board. (b) By petition delivered to an officer of the corporation, signed within 11 months preceding the next time directors will be elected, by members representing the following number of votes: Number of Votes Eligible to be Cast for Director Disregarding any Provision for Cumulative Voting Number of Votes Under 5,000 ........................ 2 percent of voting power 5,000 or more ........................ one-twentieth of 1 percent of voting power but not less than 100. This subdivision does not apply to a corporation described in subdivision (c). (c) In corporations with one million or more members engaged primarily in the business of retail merchandising of consumer goods, by petition delivered to an officer of the corporation, signed within 11 months preceding the next time directors will be elected, by such reasonable number of members as is set forth in the bylaws, or if no number is set forth in the bylaws, by such reasonable number of members as is determined by the directors. (d) If there is a meeting to elect directors, by any member present at the meeting in person or by proxy if proxies are permitted. (Amended by Stats. 1996, Ch. 589, Sec. 31. Effective January 1, 1997.)
  172. 7522.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Additional Provisions Relating to Election of Directors [7520 - 7527] ( Article 2 added by Stats. 1978, Ch. 567. )

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    A nonprofit corporation with 5,000 or more members may adopt nomination and election procedures for director elections, including a nomination close date and related voting rules.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Additional Provisions Relating to Election of Directors [7520 - 7527] ( Article 2 added by Stats. 1978, Ch. 567. ) ## 7522. A corporation with 5,000 or more members may provide that, in any election of a director or directors by members of the corporation except for an election authorized by Section 7152 or 7153: (a) The corporation’s articles or bylaws shall set a date for the close of nominations for the board. The date shall not be less than 50 nor more than 120 days before the day directors are to be elected. No nominations for the board can be made after the date set for the close of nominations. (b) If more people are nominated for the board than can be elected, the election shall take place by means of a procedure which allows all nominees a reasonable opportunity to solicit votes and all members a reasonable opportunity to choose among the nominees. (c) A nominee shall have a reasonable opportunity to communicate to the members the nominee’s qualifications and the reasons for the nominee’s candidacy. (d) If after the close of nominations the number of people nominated for the board is not more than the number of directors to be elected, the corporation may without further action declare that those nominated and qualified to be elected have been elected. (e) (1) Notwithstanding subdivision (d), for a common interest development subject to this part, if, after the close of nominations of directors for the board of directors of the common interest development, the number of director nominees is not more than the number of vacancies to be elected, as determined by the inspector or inspectors of elections selected pursuant to Section 5110 of the Civil Code, the director nominees shall be considered elected by acclamation if the association provided individual notice of the election and the procedure for nominating candidates at least 30 days before the close of nominations. (2) For purposes of this subdivision: (A) “Common interest development” has the same meaning as that term is defined in Section 4100 of the Civil Code. (B) “Individual notice” has the same meaning as that term is defined in Section 4153 of the Civil Code. (Amended by Stats. 2019, Ch. 858, Sec. 2. (SB 754) Effective January 1, 2020.)
  173. 7523.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Additional Provisions Relating to Election of Directors [7520 - 7527] ( Article 2 added by Stats. 1978, Ch. 567. )

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    A corporation with 500 or more members may choose to require equal space and prominence in its own publication for other director nominees when it publishes vote-soliciting material.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Additional Provisions Relating to Election of Directors [7520 - 7527] ( Article 2 added by Stats. 1978, Ch. 567. ) ## 7523. Where a corporation with 500 or more members publishes any material soliciting a vote for any nominee for director in any publication owned or controlled by the corporation, the corporation may provide that it shall make available to all other nominees, in the same issue of the publication, an equal amount of space, with equal prominence, to be used by the nominee for a purpose reasonably related to the election. (Amended by Stats. 1996, Ch. 589, Sec. 33. Effective January 1, 1997.)
  174. 7524.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Additional Provisions Relating to Election of Directors [7520 - 7527] ( Article 2 added by Stats. 1978, Ch. 567. )

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    A corporation with 500 or more members may choose to require mailing of a nominee’s election-related material to members, and if the request and payment conditions are met, it must mail the material within 10 business days unless it gives the nominee certain Section 8330 rights within 5 business days.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Additional Provisions Relating to Election of Directors [7520 - 7527] ( Article 2 added by Stats. 1978, Ch. 567. ) ## 7524. A corporation with 500 or more members may provide that upon written request by any nominee for election to the board and the payment of the reasonable costs of mailing (including postage), the corporation shall within 10 business days after such request (provided payment has been made) mail to all members, or such portion of them as the nominee may reasonably specify, any material, which the nominee may furnish and which is reasonably related to the election, unless the corporation within five business days after the request allows the nominee, at the corporation’s option, the rights set forth in either paragraph (1) or (2) of subdivision (a) of Section 8330. (Amended by Stats. 1996, Ch. 589, Sec. 34. Effective January 1, 1997.)
  175. 7525.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Additional Provisions Relating to Election of Directors [7520 - 7527] ( Article 2 added by Stats. 1978, Ch. 567. )

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    This section covers corporations that mail or publish nominee materials for director elections. It limits liability for the corporation and related people for nominee-supplied materials, requires the nominee to indemnify them, and lets the corporation seek a court order not to mail or publish material that could expose it to liability.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Additional Provisions Relating to Election of Directors [7520 - 7527] ( Article 2 added by Stats. 1978, Ch. 567. ) ## 7525. (a) This section shall apply to corporations publishing or mailing materials on behalf of any nominee in connection with procedures for the nomination and election of directors. (b) Neither the corporation, nor its agents, officers, directors, or employees, may be held criminally liable, liable for any negligence (active or passive) or otherwise liable for damages to any person on account of any material which is supplied by a nominee for director and which it mails or publishes in procedures intended to comply with Section 7520 or pursuant to Section 7523 or 7524 but the nominee on whose behalf such material was published or mailed shall be liable and shall indemnify and hold the corporation, its agents, officers, directors, and employees and each of them harmless from all demands, costs, including reasonable legal fees and expenses, claims, damages and causes of action arising out of such material or any such mailing or publication. (c) Nothing in this section shall prevent a corporation or any of its agents, officers, directors, or employees from seeking a court order providing that the corporation need not mail or publish material tendered by or on behalf of a nominee under this article on the ground the material will expose the moving party to liability. (Amended by Stats. 1996, Ch. 589, Sec. 35. Effective January 1, 1997.)
  176. 7526.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Additional Provisions Relating to Election of Directors [7520 - 7527] ( Article 2 added by Stats. 1978, Ch. 567. )

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    A corporation may not spend funds to support a director nominee unless the board authorizes it, and only while there are not more nominees than can be elected.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Additional Provisions Relating to Election of Directors [7520 - 7527] ( Article 2 added by Stats. 1978, Ch. 567. ) ## 7526. Without authorization of the board, no corporation funds may be expended to support a nominee for director after there are more people nominated for director than can be elected. (Added by Stats. 1978, Ch. 567.)
  177. 7527.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Additional Provisions Relating to Election of Directors [7520 - 7527] ( Article 2 added by Stats. 1978, Ch. 567. )

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    A legal challenge to the validity of a director election, appointment, or removal must be filed within nine months.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 5. Meetings and Voting [7510 - 7527] ( Chapter 5 added by Stats. 1978, Ch. 567. ) ## ARTICLE 2. Additional Provisions Relating to Election of Directors [7520 - 7527] ( Article 2 added by Stats. 1978, Ch. 567. ) ## 7527. An action challenging the validity of any election, appointment or removal of a director or directors must be commenced within nine months after the election, appointment or removal. If no such action is commenced, in the absence of fraud, any election, appointment or removal of a director is conclusively presumed valid nine months thereafter. (Amended by Stats. 1981, Ch. 587, Sec. 35.)
  178. 7610.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 6. Voting of Memberships [7610 - 7616] ( Chapter 6 added by Stats. 1978, Ch. 567. )

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    Members are generally entitled to one vote on each matter, unless the corporation’s articles or bylaws or Section 7615 provide otherwise.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 6. Voting of Memberships [7610 - 7616] ( Chapter 6 added by Stats. 1978, Ch. 567. ) ## 7610. Except as provided in a corporation’s articles or bylaws or Section 7615, each member shall be entitled to one vote on each matter submitted to a vote of the members. Single memberships in which two or more persons have an indivisible interest shall be voted as provided in Section 7612. (Added by Stats. 1978, Ch. 567.)
  179. 7611.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 6. Voting of Memberships [7610 - 7616] ( Chapter 6 added by Stats. 1978, Ch. 567. )

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    This section lets bylaws or the board set a record date to decide which members may receive notice, vote, cast written ballots, or exercise other rights at a members’ meeting.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 6. Voting of Memberships [7610 - 7616] ( Chapter 6 added by Stats. 1978, Ch. 567. ) ## 7611. (a) The bylaws may provide or, in the absence of such provision, the board may fix, in advance, a date as the record date for the purpose of determining the members entitled to notice of any meeting of members. Such record date shall not be more than 90 nor less than 10 days before the date of the meeting. If no record date is fixed, members at the close of business on the business day preceding the day on which notice is given or, if notice is waived, at the close of business on the business day preceding the day on which the meeting is held are entitled to notice of a meeting of members. A determination of members entitled to notice of a meeting of members shall apply to any adjournment of the meeting unless the board fixes a new record date for the adjourned meeting. (b) The bylaws may provide or, in the absence of such provision, the board may fix, in advance, a date as the record date for the purpose of determining the members entitled to vote at a meeting of members. Such record date shall not be more than 60 days before the date of the meeting. Such record date shall also apply in the case of an adjournment of the meeting unless the board fixes a new record date for the adjourned meeting. If no record date is fixed, members on the day of the meeting who are otherwise eligible to vote are entitled to vote at the meeting of members or, in the case of an adjourned meeting, members on the day of the adjourned meeting who are otherwise eligible to vote are entitled to vote at the adjourned meeting of members. (c) The bylaws may provide or, in the absence of such provision, the board may fix, in advance, a date as the record date for the purpose of determining the members entitled to cast written ballots (Section 7513). Such record date shall not be more than 60 days before the day on which the first written ballot is mailed or solicited. If no record date is fixed, members on the day the first written ballot is mailed or solicited who are otherwise eligible to vote are entitled to cast written ballots. (d) The bylaws may provide or, in the absence of such provision, the board may fix, in advance, a date as the record date for the purpose of determining the members entitled to exercise any rights in respect of any other lawful action. Such record date shall not be more than 60 days prior to such other action. If no record date is fixed, members at the close of business on the day on which the board adopts the resolution relating thereto, or the 60th day prior to the date of such other action, whichever is later, are entitled to exercise such rights. (Amended by Stats. 1981, Ch. 587, Sec. 36.)
  180. 7612.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 6. Voting of Memberships [7610 - 7616] ( Chapter 6 added by Stats. 1978, Ch. 567. )

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    When a membership is held by two or more people, voting by one person can bind all, and if more than one votes, the majority controls, unless the secretary gets written notice and the required instrument or order copy.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 6. Voting of Memberships [7610 - 7616] ( Chapter 6 added by Stats. 1978, Ch. 567. ) ## 7612. If a membership stands of record in the names of two or more persons, whether fiduciaries, members of a partnership, joint tenants, tenants in common, spouses as community property, tenants by the entirety, persons entitled to vote under a voting agreement or otherwise, or if two or more persons (including proxyholders) have the same fiduciary relationship respecting the same membership, unless the secretary of the corporation is given written notice to the contrary and is furnished with a copy of the instrument or order appointing them or creating the relationship wherein it is so provided, their acts with respect to voting shall have the following effect: (a) If only one votes, such act binds all; or (b) If more than one vote, the act of the majority so voting binds all. (Amended by Stats. 2016, Ch. 50, Sec. 23. (SB 1005) Effective January 1, 2017.)
  181. 7613.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 6. Voting of Memberships [7610 - 7616] ( Chapter 6 added by Stats. 1978, Ch. 567. )

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    Members may appoint proxies to act for their memberships, but proxy rights can be limited by the articles or bylaws and certain proxy validity rules apply.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 6. Voting of Memberships [7610 - 7616] ( Chapter 6 added by Stats. 1978, Ch. 567. ) ## 7613. (a) Any member may authorize another person or persons to act by proxy with respect to such membership except that this right may be limited or withdrawn by the articles or bylaws, subject to subdivision (f). Any proxy purported to be executed in accordance with the provisions of this part shall be presumptively valid. (b) No proxy shall be valid after the expiration of 11 months from the date thereof unless otherwise provided in the proxy, except that the maximum term of any proxy shall be three years from the date of execution. Every proxy continues in full force and effect until revoked by the person executing it prior to the vote pursuant thereto, except as otherwise provided in this section. Such revocation may be effected by a writing delivered to the corporation stating that the proxy is revoked or by a subsequent proxy executed by the person executing the prior proxy and presented to the meeting, or as to any meeting by attendance at such meeting and voting in person by the person executing the proxy. The dates contained on the forms of proxy presumptively determine the order of execution, regardless of the postmark dates on the envelopes in which they are mailed. (c) A proxy is not revoked by the death or incapacity of the maker or the termination of a membership as a result thereof unless, before the vote is counted, written notice of such death or incapacity is received by the corporation. (d) Unless otherwise provided in the articles or bylaws, the proxy of a member which states that it is irrevocable is irrevocable for the period specified therein (notwithstanding subdivisions (b) and (c)) when it is held by any of the following or a nominee of any of the following: (1) A person who has purchased or who has agreed to purchase the membership; (2) A creditor or creditors of the corporation or the member who extended or continued credit to the corporation or the member in consideration of the proxy if the proxy states that it was given in consideration of such extension or continuation of credit and the name of the person extending or continuing the credit; or (3) A person who has contracted to perform services as an employee of the corporation, if the proxy is required by the contract of employment and if the proxy states that it was given in consideration of such contract of employment, the name of the employee and the period of employment contracted for. Notwithstanding the period of irrevocability specified, the proxy becomes revocable when the agreement to purchase is terminated; the debt of the corporation or the member is paid; or the period of employment provided for in the contract of employment has terminated. In addition to the foregoing paragraphs (1) through (3), a proxy of a member may be made irrevocable (notwithstanding subdivision (c)) if it is given to secure the performance of a duty or to protect a title, either legal or equitable, until the happening of events which, by its terms, discharge the obligations secured by it. (e) A proxy may be revoked, notwithstanding a provision making it irrevocable, by a transferee of a membership without knowledge of the existence of the provision unless the existence of the proxy and its irrevocability appears on the certificate representing the membership. (f) Subdivision (a) notwithstanding: (1) No amendment of the articles or bylaws repealing, restricting, creating or expanding proxy rights may be adopted without approval by the members (Section 5034); and (2) No amendment of the articles or bylaws restricting or limiting the use of proxies may affect the validity of a previously issued irrevocable proxy during the term of its irrevocability, so long as it complied with applicable provisions, if any, of the articles or bylaws at the time of its issuance, and is otherwise valid under this section. (g) Anything to the contrary notwithstanding, any revocable proxy covering matters requiring a vote of the members pursuant to Section 7222; Section 7224; Section 7233; paragraph (1) of subdivision (f) of this section; Section 7812; paragraph (2) of subdivision (a) of Section 7911; Section 8012; subdivision (a) of Section 8015; Section 8610; or subdivision (a) of Section 8719 is not valid as to such matters unless it sets forth the general nature of the matter to be voted on. (Amended by Stats. 1981, Ch. 587, Sec. 37.)
  182. 7614.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 6. Voting of Memberships [7610 - 7616] ( Chapter 6 added by Stats. 1978, Ch. 567. )

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    The board, or sometimes the meeting chairperson, may appoint election inspectors for members’ meetings, and those inspectors must carry out specified voting duties fairly and in good faith.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 6. Voting of Memberships [7610 - 7616] ( Chapter 6 added by Stats. 1978, Ch. 567. ) ## 7614. (a) In advance of any meeting of members, the board may appoint inspectors of election to act at the meeting and any adjournment thereof. If inspectors of election are not so appointed, or if any persons so appointed fail to appear or refuse to act, the chairperson of any meeting of members may, and on the request of any member or a member’s proxy shall, appoint inspectors of election (or persons to replace those who so fail or refuse) at the meeting. The number of inspectors shall be either one or three. If appointed at a meeting on the request of one or more members or proxies, the majority of members represented in person or by proxy shall determine whether one or three inspectors are to be appointed. In the case of any action by written ballot (Section 7513), the board may similarly appoint inspectors of election to act with powers and duties as set forth in this section. (b) The inspectors of election shall determine the number of memberships outstanding and the voting power of each, the number represented at the meeting, the existence of a quorum, and the authenticity, validity and effect of proxies, receive votes, ballots or consents, hear and determine all challenges and questions in any way arising in connection with the right to vote, count and tabulate all votes or consents, determine when the polls shall close, determine the result and do such acts as may be proper to conduct the election or vote with fairness to all members. (c) The inspectors of election shall perform their duties impartially, in good faith, to the best of their ability and as expeditiously as is practical. If there are three inspectors of election, the decision, act or certificate of a majority is effective in all respects as the decision, act, or certificate of all. Any report or certificate made by the inspectors of election is prima facie evidence of the facts stated therein. (Amended by Stats. 2022, Ch. 617, Sec. 63. (SB 1202) Effective January 1, 2023.)
  183. 7615.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 6. Voting of Memberships [7610 - 7616] ( Chapter 6 added by Stats. 1978, Ch. 567. )

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    This section lets members use cumulative voting for director elections only if the articles or bylaws authorize it, and sets notice and nomination conditions for using that voting method.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 6. Voting of Memberships [7610 - 7616] ( Chapter 6 added by Stats. 1978, Ch. 567. ) ## 7615. (a) If the articles or bylaws authorize cumulative voting, but not otherwise, every member entitled to vote at any election of directors may cumulate the member’s votes and give one candidate a number of votes equal to the number of directors to be elected multiplied by the number of votes to which the member is entitled, or distribute the member’s votes on the same principle among as many candidates as the member thinks fit. An article or bylaw provision authorizing cumulative voting may be repealed or amended only by approval of the members (Section 5034), except that the governing article or bylaw provision may require the vote of a greater proportion of the members, or of the members of any class, for its repeal. (b) No member shall be entitled to cumulate votes for a candidate or candidates unless the candidate’s name or candidates’ names have been placed in nomination prior to the voting and the member has given notice at the meeting prior to the voting of the member’s intention to cumulate votes. If any one member has given this notice, all members may cumulate their votes for candidates in nomination. (c) In any election of directors by cumulative voting, the candidates receiving the highest number of votes are elected, subject to any lawful provision specifying election by classes. (d) In any election of directors not governed by subdivision (c), unless otherwise provided in the articles or bylaws, the candidates receiving the highest number of votes are elected. (e) Elections for directors need not be by ballot unless a member demands election by ballot at the meeting and before the voting begins or unless the bylaws so require. (Amended by Stats. 1984, Ch. 812, Sec. 10.)
  184. 7616.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 6. Voting of Memberships [7610 - 7616] ( Chapter 6 added by Stats. 1978, Ch. 567. )

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    This section lets certain people challenge a nonprofit corporation director election or appointment in superior court, requires notice to the Attorney General in charitable-trust cases, and gives the court authority to set a quick hearing and grant related relief.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 6. Voting of Memberships [7610 - 7616] ( Chapter 6 added by Stats. 1978, Ch. 567. ) ## 7616. (a) Upon the filing of an action therefor by any director or member or by any person who had the right to vote in the election at issue, the superior court of the proper county shall determine the validity of any election or appointment of any director of any corporation. (b) In the case of a corporation holding assets in charitable trust, any person bringing an action under this section shall give notice of the action to the Attorney General, who may intervene. (c) Upon the filing of the complaint, and before any further proceedings are had, the court shall enter an order fixing a date for the hearing, which shall be within five days unless for good cause shown a later date is fixed, and requiring notice of the date for the hearing and a copy of the complaint to be served upon the corporation and upon the person whose purported election or appointment is questioned and upon any person (other than the plaintiff) whom the plaintiff alleges to have been elected or appointed, in the manner in which a summons is required to be served, or, if the court so directs, by registered mail; and the court may make such further requirements as to notice as appear to be proper under the circumstances. (d) The court, consistent with the provisions of this part and in conformity with the articles and bylaws to the extent feasible, may determine the person entitled to the office of director or may order a new election to be held or appointment to be made, may determine the validity, effectiveness and construction of voting agreements and voting trusts, the validity of the issuance of memberships and the right of persons to vote and may direct such other relief as may be just and proper. (Added by Stats. 1978, Ch. 567.)
  185. 7710.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 7. Members’ Derivative Actions [7710- 7710.] ( Chapter 7 added by Stats. 1978, Ch. 567. )

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    In certain member derivative actions, the court may require the plaintiff to post a bond, but not if the suit is brought by 100 members or fewer as specified. The plaintiff must also meet pleading requirements, and if a bond order is made, the action can be dismissed unless the bond is posted.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 7. Members’ Derivative Actions [7710- 7710.] ( Chapter 7 added by Stats. 1978, Ch. 567. ) ## 7710. (a) Subdivisions (c) through (f) notwithstanding, no motion to require a bond shall be granted in an action brought by 100 members or the authorized number (Section 5036), whichever is less. (b) No action may be instituted or maintained in the right of any corporation by any member of such corporation unless both of the following conditions exist: (1) The plaintiff alleges in the complaint that plaintiff was a member at the time of the transaction or any part thereof of which plaintiff complains, or that plaintiff’s membership thereafter devolved upon plaintiff by operation of law from a holder who was a holder at the time of transaction or any part thereof complained of; and (2) The plaintiff alleges in the complaint with particularity plaintiff’s efforts to secure from the board such action as plaintiff desires, or the reasons for not making such effort, and alleges further that plaintiff has either informed the corporation or the board in writing of the ultimate facts of each cause of action against each defendant or delivered to the corporation or the board a true copy of the complaint which plaintiff proposes to file. (c) Subject to subdivision (a), in any action referred to in subdivision (b), at any time within 30 days after service of summons upon the corporation or upon any defendant who is an officer or director of the corporation, or held such office at the time of the acts complained of, the corporation or such defendant may move the court for an order, upon notice and hearing, requiring the plaintiff to furnish a bond as hereinafter provided. The motion shall be based upon one or both of the following grounds: (1) That there is no reasonable possibility that the prosecution of the cause of action alleged in the complaint against the moving party will benefit the corporation or its members economically or otherwise. (2) That the moving party, if other than the corporation, did not participate in the transaction complained of in any capacity. The court on application of the corporation or any defendant may, for good cause shown, extend the 30-day period for an additional period or periods not exceeding 60 days. (d) At the hearing upon any motion pursuant to subdivision (c), the court shall consider such evidence, written or oral, by witnesses or affidavit, as may be material (1) to the ground or grounds upon which the motion is based, or (2) to a determination of the probable reasonable expenses, including attorneys’ fees, of the corporation and the moving party which will be incurred in the defense of the action. If the court determines, after hearing the evidence adduced by the parties, that the moving party has established a probability in support of any of the grounds upon which the motion is based, the court shall fix the amount of the bond, not to exceed fifty thousand dollars ($50,000), to be furnished by the plaintiff for reasonable expenses, including attorneys’ fees, which may be incurred by the moving party and the corporation in connection with the action, including expenses for which the corporation may become liable pursuant to Section 7237. A ruling by the court on the motion shall not be a determination of any issue in the action or of the merits thereof. If the court, upon any such motion, makes a determination that a bond shall be furnished by the plaintiff as to any one or more defendants, the action shall be dismissed as to such defendant or defendants, unless the bond required by the court has been furnished within such reasonable time as may be fixed by the court. (e) If the plaintiff shall, either before or after a motion is made pursuant to subdivision (c), or any order or determination pursuant to such motion, furnish a bond or bonds in the aggregate amount of fifty thousand dollars ($50,000) to secure the reasonable expenses of the parties entitled to make the motion, the plaintiff has complied with the requirements of this section and with any order for a bond theretofore made, and any such motion then pending shall be dismissed and no further or additional bond shall be required. (f) If a motion is filed pursuant to subdivision (c), no pleadings need be filed by the corporation or any other defendant and the prosecution of the action shall be stayed until 10 days after the motion has been disposed of. (Amended by Stats. 1982, Ch. 517, Sec. 189.)
  186. 7810.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 8. Amendment of Articles [7810 - 7820] ( Chapter 8 added by Stats. 1978, Ch. 567. )

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    A corporation may amend its articles if it follows this chapter, but it generally may not change certain original-article statements about its initial addresses, first directors, or initial agent except to correct an error or delete the information after filing a Section 8210 statement.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 8. Amendment of Articles [7810 - 7820] ( Chapter 8 added by Stats. 1978, Ch. 567. ) ## 7810. (a) By complying with the provisions of this chapter, a corporation may amend its articles from time to time, in any and as many respects as may be desired, so long as its articles as amended contain only such provisions as it would be lawful to insert in original articles filed at the time of the filing of the amendment or as authorized by Section 7813.5 and, if a change in the rights of members or an exchange, reclassification or cancellation of memberships is to be made, such provisions as may be necessary to effect such change, exchange, reclassification or cancellation. It is the intent of the Legislature in adopting this section to exercise to the fullest extent the reserve power of the state over corporations and to authorize any amendment of the articles covered by the preceding sentence regardless of whether any provision contained in the amendment was permissible at the time of the original incorporation of the corporation. (b) A corporation shall not amend its articles to add any statement or to alter any statement which may appear in the original articles of the initial street address and initial mailing address of the corporation, the names and addresses of the first directors, or the name and address of the initial agent, except to correct an error in the statement or to delete the information after the corporation has filed a statement under Section 8210. (Amended by Stats. 2012, Ch. 494, Sec. 19. (SB 1532) Effective January 1, 2013.)
  187. 7811.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 8. Amendment of Articles [7810 - 7820] ( Chapter 8 added by Stats. 1978, Ch. 567. )

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    An amendment of the articles may be adopted in writing if it is signed by a majority of the incorporators and the stated conditions are met.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 8. Amendment of Articles [7810 - 7820] ( Chapter 8 added by Stats. 1978, Ch. 567. ) ## 7811. Any amendment of the articles may be adopted by a writing signed by a majority of the incorporators, so long as: (a) No directors were named in the original articles; (b) No directors have been elected; and (c) The corporation has no members. (Added by Stats. 1978, Ch. 567.)
  188. 7812.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 8. Amendment of Articles [7810 - 7820] ( Chapter 8 added by Stats. 1978, Ch. 567. )

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    This section says nonprofit mutual benefit corporations can amend their articles if the required approvals are obtained, and some listed amendments may be approved by the board alone.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 8. Amendment of Articles [7810 - 7820] ( Chapter 8 added by Stats. 1978, Ch. 567. ) ## 7812. (a) Except as provided in this section or Section 7813, amendments may be adopted if approved by the board and approved by the members (Section 5034) and approved by such other person or persons, if any, as required by the articles. The approval by the members or other person or persons may be before or after the approval by the board. (b) Notwithstanding subdivision (a), the following amendments may be adopted by approval of the board alone: (1) An amendment extending the corporate existence or making the corporate existence perpetual, if the corporation was organized prior to August 14, 1929. (2) An amendment deleting the initial street address and initial mailing address of the corporation, the names and addresses of the first directors, or the name and address of the initial agent. (3) Any amendment, at a time the corporation has no members; provided, however, that if the articles require approval by any person for an amendment, an amendment may not be adopted without such approval. (4) An amendment adopted pursuant to Section 9913. (c) Whenever the articles require for corporate action the approval of a particular class of members or of a larger proportion of, or all of, the votes of any class, or of a larger proportion of, or all of, the directors, than is otherwise required by this part, the provision in the articles requiring such greater vote shall not be altered, amended or repealed except by such class or such greater vote, unless otherwise provided in the articles. (Amended by Stats. 2012, Ch. 494, Sec. 20. (SB 1532) Effective January 1, 2013.)
  189. 7813.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 8. Amendment of Articles [7810 - 7820] ( Chapter 8 added by Stats. 1978, Ch. 567. )

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    A class of members must approve an amendment if the amendment would materially affect that class’s voting, dissolution, redemption, transfer rights, membership numbers, or create a new class.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 8. Amendment of Articles [7810 - 7820] ( Chapter 8 added by Stats. 1978, Ch. 567. ) ## 7813. An amendment must also be approved by the members (Section 5034) of a class, whether or not such class is entitled to vote thereon by the provisions of the articles or bylaws, if the amendment would: (a) Materially and adversely affect the rights, privileges, preferences, restrictions or conditions of that class as to voting, dissolution, redemption or transfer in a manner different than such action affects another class; (b) Materially and adversely affect such class as to voting, dissolution, redemption or transfer by changing the rights, privileges, preferences, restrictions or conditions of another class; (c) Increase or decrease the number of memberships authorized for such class; (d) Increase the number of memberships authorized for another class; (e) Effect an exchange, reclassification or cancellation of all or part of the memberships of such class; or (f) Authorize a new class of memberships. (Amended by Stats. 1981, Ch. 587, Sec. 38.)
  190. 7813.5.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 8. Amendment of Articles [7810 - 7820] ( Chapter 8 added by Stats. 1978, Ch. 567. )

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    A mutual benefit corporation may change its status by amending its articles if it follows this section and related chapter provisions.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 8. Amendment of Articles [7810 - 7820] ( Chapter 8 added by Stats. 1978, Ch. 567. ) ## 7813.5. (a) A mutual benefit corporation may amend its articles to change its status to that of a public benefit corporation, a religious corporation, a business corporation, a social purpose corporation, or a cooperative corporation by complying with this section and the other sections of this chapter. (b) Except as authorized by Section 7811 or unless the corporation has no members, an amendment to change its status to a public benefit corporation or religious corporation shall: (1) be approved by the members (Section 5034), and the fairness of the amendment to the members shall be approved by the Commissioner of Financial Protection and Innovation pursuant to Section 25142; (2) be approved by the members (Section 5034) in an election conducted by written ballot pursuant to Section 7513 in which no negative votes are cast; or (3) be approved by 100 percent of the voting power. (c) Amended articles authorized by this section shall include the provisions which would have been required (other than the initial street address and initial mailing address of the corporation and the name of the initial agent for service of process if a statement has been filed pursuant to Section 8210), and may in addition only include those provisions which would have been permitted, in original articles filed by the type of corporation (public benefit, religious, business, social purpose, or cooperative) into which the mutual benefit corporation is changing its status. (d) At the time of filing a certificate of amendment to change status to a public benefit corporation, the Secretary of State shall make available the filed certificate to the Attorney General. (e) In the case of a change of status to a business corporation, social purpose corporation, or a cooperative corporation, if the Franchise Tax Board has issued a determination exempting the corporation from tax as provided in Section 23701 of the Revenue and Taxation Code, the corporation shall be subject to Section 23221 of the Revenue and Taxation Code upon filing the certificate of amendment. (Amended by Stats. 2022, Ch. 617, Sec. 64. (SB 1202) Effective January 1, 2023.)
  191. 7814.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 8. Amendment of Articles [7810 - 7820] ( Chapter 8 added by Stats. 1978, Ch. 567. )

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    After an amendment is adopted, the corporation must file a certificate of amendment, except when the amendment was adopted by incorporators under Section 7811.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 8. Amendment of Articles [7810 - 7820] ( Chapter 8 added by Stats. 1978, Ch. 567. ) ## 7814. (a) Except for amendments adopted by the incorporators pursuant to Section 7811, upon adoption of an amendment, the corporation shall file a certificate of amendment, which shall consist of an officers’ certificate stating: (1) The wording of the amendment or amended articles in accordance with Section 7816; (2) That the amendment has been approved by the board; (3) If the amendment is one for which the approval of the members (Section 5034) or the approval of 100 percent of the voting power is required, that the amendment was approved by the required vote of members; and (4) If the amendment is one which may be adopted with approval by the board alone, a statement of the facts entitling the board alone to adopt the amendment. (5) If the amendment is one for which the approval of a person or persons other than the incorporators, directors or members is required, that the approval of such person or persons has been obtained. (b) In the event of an amendment of the articles pursuant to a merger, the filing of the officers’ certificate and agreement pursuant to Section 8014 shall be in lieu of any filing required under this chapter. (Amended by Stats. 1979, Ch. 724.)
  192. 7815.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 8. Amendment of Articles [7810 - 7820] ( Chapter 8 added by Stats. 1978, Ch. 567. )

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    If incorporators adopt amendments under Section 7811, the corporation must file a signed and verified certificate of amendment.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 8. Amendment of Articles [7810 - 7820] ( Chapter 8 added by Stats. 1978, Ch. 567. ) ## 7815. In the case of amendments adopted by the incorporators under Section 7811, the corporation shall file a certificate of amendment signed and verified by a majority of the incorporators which shall state that the signers thereof constitute at least a majority of the incorporators, that directors were not named in the original articles and have not been elected, that the corporation has no members and that they adopt the amendment or amendments therein set forth. (Amended by Stats. 1979, Ch. 724.)
  193. 7816.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 8. Amendment of Articles [7810 - 7820] ( Chapter 8 added by Stats. 1978, Ch. 567. )

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    A certificate of amendment must state the amendment wording in one or more specified ways, and if memberships are being reclassified, canceled, exchanged, or otherwise changed, the amended articles must state the effect on outstanding memberships.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 8. Amendment of Articles [7810 - 7820] ( Chapter 8 added by Stats. 1978, Ch. 567. ) ## 7816. The certificate of amendment shall establish the wording of the amendment or amended articles by one or more of the following means: (a) By stating that the articles shall be amended to read as therein set forth in full. (b) By stating that any provision of the articles, which shall be identified by the numerical or other designation given it in the articles or by stating the wording thereof, shall be stricken from the articles or shall be amended to read as set forth in the certificate. (c) By stating that the provisions set forth therein shall be added to the articles. If the purpose of the amendment is to reclassify, cancel, exchange, or otherwise change outstanding memberships the amended articles shall state the effect thereof on outstanding memberships. (Added by Stats. 1978, Ch. 567.)
  194. 7817.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 8. Amendment of Articles [7810 - 7820] ( Chapter 8 added by Stats. 1978, Ch. 567. )

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    When the certificate of amendment is filed, the articles are amended as stated in the certificate and any membership changes are carried out.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 8. Amendment of Articles [7810 - 7820] ( Chapter 8 added by Stats. 1978, Ch. 567. ) ## 7817. Upon the filing of the certificate of amendment, the articles shall be amended in accordance with the certificate and any change, reclassification or cancellation of memberships shall be effected, and a copy of the certificate, certified by the Secretary of State, is prima facie evidence of the performance of the conditions necessary to the adoption of the amendment. (Added by Stats. 1978, Ch. 567.)
  195. 7818.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 8. Amendment of Articles [7810 - 7820] ( Chapter 8 added by Stats. 1978, Ch. 567. )

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    A limited-period corporation may extend its term after expiration by amending its articles to remove the term limit and provide perpetual existence.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 8. Amendment of Articles [7810 - 7820] ( Chapter 8 added by Stats. 1978, Ch. 567. ) ## 7818. A corporation formed for a limited period may at any time subsequent to the expiration of the term of its corporate existence, extend the term of its existence by an amendment to its articles removing any provision limiting the term of its existence and providing for perpetual existence. If the filing of the certificate of amendment providing for perpetual existence would be prohibited if it were original articles by the provisions of Section 7122, the Secretary of State shall not file such certificate unless, by the same or a concurrently filed certificate of amendment, the articles of such corporation are amended to adopt a new available name. For the purpose of the adoption of any such amendment, persons who have been functioning as directors of such corporation shall be considered to have been validly elected even though their election may have occurred after the expiration of the original term of the corporate existence. (Added by Stats. 1978, Ch. 567.)
  196. 7819.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 8. Amendment of Articles [7810 - 7820] ( Chapter 8 added by Stats. 1978, Ch. 567. )

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    A corporation may file restated articles in one certificate, and if the certificate changes the articles it must follow the cited amendment procedures.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 8. Amendment of Articles [7810 - 7820] ( Chapter 8 added by Stats. 1978, Ch. 567. ) ## 7819. (a) A corporation may restate in a single certificate the entire text of its articles as amended by filing an officers’ certificate or, in circumstances where incorporators or the board may amend a corporation’s articles pursuant to Sections 7811 and 7815, a certificate signed and verified by a majority of the incorporators or the board, as applicable, entitled “Restated Articles of Incorporation of (insert name of corporation)” which shall set forth the articles as amended to the date of filing of the certificate, except that the signatures and acknowledgments of the articles by the incorporators and any statements regarding the effect of any prior amendment upon memberships and any provisions of agreements of merger (other than amendments to the articles of the surviving corporation), and the initial street address and initial mailing address of the corporation, and the names and addresses of the first directors and of the initial agent for service of process shall be omitted (except that the initial street address and initial mailing address of the corporation and the names and addresses of the initial agent for service of process and, if previously set forth in the articles, the initial directors, shall not be omitted prior to the time that the corporation has filed a statement under Section 8210). Such omissions are not alterations or amendments of the articles. The certificate may also itself alter or amend the articles in any respect, in which case the certificate must comply with Section 7814 or 7815, as the case may be, and Section 7816. (b) If the certificate does not itself alter or amend the articles in any respect, it shall be approved by the board or, prior to the issuance of any memberships and the naming and election of directors, by a majority of the incorporators, and shall be subject to the provisions of this chapter relating to an amendment of the articles not requiring approval of the members (Section 5034). If the certificate does itself alter or amend the articles, it shall be subject to the provisions of this chapter relating to the amendment or amendments so made. (c) Restated articles of incorporation filed pursuant to this section shall supersede for all purposes the original articles and all amendments filed prior thereto. (Amended by Stats. 2012, Ch. 494, Sec. 22. (SB 1532) Effective January 1, 2013.)
  197. 7820.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 8. Amendment of Articles [7810 - 7820] ( Chapter 8 added by Stats. 1978, Ch. 567. )

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    An amendment to a corporation’s articles does not, by itself, remove charitable trust requirements or limits, and the Attorney General may issue rulings on whether to oppose a proposed action or amendment.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 8. Amendment of Articles [7810 - 7820] ( Chapter 8 added by Stats. 1978, Ch. 567. ) ## 7820. (a) Amendment of the articles of a corporation holding property in charitable trust, pursuant to this chapter, does not, of itself, abrogate any requirement or limitation imposed upon the corporation, or any property held by it, by virtue of the trust under which such property is held by the corporation. (b) The Attorney General may, at the corporation’s request, and pursuant to such regulations as the Attorney General may issue, give rulings as to whether the Attorney General will or may oppose a proposed action, or article amendment, as inconsistent with or proscribed by the requirements of a charitable trust. (Added by Stats. 1978, Ch. 567.)
  198. 7910.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 9. Sales of Assets [7910 - 7914] ( Chapter 9 added by Stats. 1978, Ch. 567. )

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    The board may approve certain liens on corporate property to secure a contract or obligation, and member approval is not needed unless the articles or bylaws say otherwise.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 9. Sales of Assets [7910 - 7914] ( Chapter 9 added by Stats. 1978, Ch. 567. ) ## 7910. Any mortgage, deed of trust, pledge or other hypothecation of all or any part of the corporation’s property, real or personal, for the purpose of securing the payment or performance of any contract or obligation may be approved by the board. Unless the articles or bylaws otherwise provide, no approval of the members (Section 5034) shall be necessary for such action. (Added by Stats. 1978, Ch. 567.)
  199. 7911.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 9. Sales of Assets [7910 - 7914] ( Chapter 9 added by Stats. 1978, Ch. 567. )

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    A corporation may dispose of substantially all of its assets if the board approves the terms, and members also approve unless the deal is in the usual course of business.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 9. Sales of Assets [7910 - 7914] ( Chapter 9 added by Stats. 1978, Ch. 567. ) ## 7911. (a) Subject to the provisions of Section 7142, a corporation may sell, lease, convey, exchange, transfer or otherwise dispose of all or substantially all of its assets when the principal terms are: (1) Approved by the board; and (2) Unless the transaction is in the usual and regular course of its activities, approved by the members (Section 5034), either before or after approval by the board and before or after the transaction. (b) Notwithstanding approval by the members (Section 5034), the board may abandon the proposed transaction without further action by the members, subject to the contractual rights, if any, of third parties. (c) Subject to the provisions of Section 7142, such sale, lease, conveyance, exchange, transfer or other disposition may be made upon such terms and conditions and for such consideration as the board may deem in the best interests of the corporation. The consideration may be money, property, or securities of any domestic corporation, foreign corporation, or foreign business corporation or any of them. (Amended by Stats. 1981, Ch. 587, Sec. 39.)
  200. 7912.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 9. Sales of Assets [7910 - 7914] ( Chapter 9 added by Stats. 1978, Ch. 567. )

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    A deed or transfer instrument for corporate assets may be accompanied by a certificate from the secretary or assistant secretary stating the required approval facts.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 2. NONPROFIT CORPORATION LAW [5000 - 10841] ( Heading of Division 2 amended by Stats. 1978, Ch. 567. ) ## PART 3. NONPROFIT MUTUAL BENEFIT CORPORATIONS [7110 - 8910] ( Part 3 added by Stats. 1978, Ch. 567. ) ## CHAPTER 9. Sales of Assets [7910 - 7914] ( Chapter 9 added by Stats. 1978, Ch. 567. ) ## 7912. Any deed or instrument conveying or otherwise transferring any assets of a corporation may have annexed to it the certificate of the secretary or an assistant secretary of the corporation, setting forth that the transaction has been validly approved by the board and (a) stating that the property described in such deed or instrument is less than substantially all of the assets of the corporation or that the transfer is in the usual and regular course of the business of the corporation, if such be the case, or (b) if such property constitutes all or substantially all of the assets of the corporation and the transfer is not in the usual and regular course of the business of the corporation, stating the fact of approval thereof by the members (Section 5034) or all the members pursuant to this chapter. Such certificate is prima facie evidence of the existence of the facts authorizing such conveyance or other transfer of the assets and conclusive evidence in favor of any purchaser or encumbrancer for value who, without notice of any trust restriction applicable to the property or any failure to comply therewith, in good faith parted with value. (Added by Stats. 1978, Ch. 567.)

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