Corporations Code — Part 2 | CORP — United States — California law | Esheria

Corporations Code

Part 2 of 13 · provisions 201–400

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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. 12364.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 2. Directors and Management [12350 - 12377] ( Chapter 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 2. Selection, Removal and Resignation of Directors [12360 - 12364] ( Article 2 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    This section says who may fill board vacancies and how a director may resign.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 2. Directors and Management [12350 - 12377] ( Chapter 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 2. Selection, Removal and Resignation of Directors [12360 - 12364] ( Article 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12364. (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 12222) 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 12351, or (3) a sole remaining director. Unless the articles or a bylaw approved by the members (Section 12224) provide that the board may fill vacancies occurring in the board by reason of the removal of directors, such vacancies may be filled only by approval of the members (Section 12224). (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. 78. (SB 1202) Effective January 1, 2023.)
  2. 12370.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 2. Directors and Management [12350 - 12377] ( Chapter 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Standards of Conduct [12370 - 12377] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    The duties and liabilities in this article apply even if a director is paid by the corporation.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 2. Directors and Management [12350 - 12377] ( Chapter 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Standards of Conduct [12370 - 12377] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12370. Any duties and liabilities set forth in this article shall apply without regard to whether a director is compensated by the corporation. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  3. 12371.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 2. Directors and Management [12350 - 12377] ( Chapter 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Standards of Conduct [12370 - 12377] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    A director must perform director duties in good faith, with care and reasonable inquiry, and may rely on certain reports and statements if the stated conditions are met.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 2. Directors and Management [12350 - 12377] ( Chapter 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Standards of Conduct [12370 - 12377] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12371. (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 such 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 persons’s obligations as a director. (Amended by Stats. 2009, Ch. 631, Sec. 48. (AB 1233) Effective January 1, 2010.)
  4. 12372.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 2. Directors and Management [12350 - 12377] ( Chapter 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Standards of Conduct [12370 - 12377] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    Section 12372 says directors’ duties under Section 12371 cover acts or omissions connected with electing, selecting, or nominating directors.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 2. Directors and Management [12350 - 12377] ( Chapter 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Standards of Conduct [12370 - 12377] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12372. (a) Section 12371 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 12371. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  5. 12373.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 2. Directors and Management [12350 - 12377] ( Chapter 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Standards of Conduct [12370 - 12377] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    Certain corporation-director transactions are not automatically void or voidable if the required facts are disclosed and the transaction is approved in good faith; otherwise, the person relying on the transaction must prove it was fair to the corporation.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 2. Directors and Management [12350 - 12377] ( Chapter 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Standards of Conduct [12370 - 12377] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12373. (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 12224) 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), 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. Neither a mere common directorship nor a member-patron relationship on terms available to all members constitutes 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 in good faith; or (2) As to contracts or transactions not approved as provided in paragraph (1), 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). (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  6. 12374.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 2. Directors and Management [12350 - 12377] ( Chapter 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Standards of Conduct [12370 - 12377] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. )

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

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 2. Directors and Management [12350 - 12377] ( Chapter 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Standards of Conduct [12370 - 12377] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12374. 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 12373. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  7. 12375.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 2. Directors and Management [12350 - 12377] ( Chapter 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Standards of Conduct [12370 - 12377] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    A corporation may lend money or property to, guarantee obligations of, or advance expenses to directors or officers, but only if the stated approvals and conditions are met.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 2. Directors and Management [12350 - 12377] ( Chapter 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Standards of Conduct [12370 - 12377] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12375. (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 12224), without counting the vote of the director or officer, if a member. (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, for any expenses reasonably anticipated to be incurred in the performance of the duties of the director or officer, 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. (Repealed and added by Stats. 1983, Ch. 792, Sec. 17.)
  8. 12376.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 2. Directors and Management [12350 - 12377] ( Chapter 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Standards of Conduct [12370 - 12377] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    Directors who approve certain unlawful corporate actions can be jointly and severally liable to the corporation and related claimants.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 2. Directors and Management [12350 - 12377] ( Chapter 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Standards of Conduct [12370 - 12377] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12376. (a) Subject to the provisions of Section 12371, directors of a corporation who approve any of the following corporate actions are 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 members under paragraph (3) of subdivision (c): (1) The making of any distribution or purchase or redemption of memberships contrary to Chapter 4 (commencing with Section 12450). (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 Chapters 15 (commencing with Section 12620), 16 (commencing with Section 12630), and 17 (commencing with Section 12650). (3) The making of any loan or guarantee contrary to Section 12375. (b) A director who is present at a meeting of the board, or any committee thereof, at which 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 12455. (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 12490. (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 guarantee, 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 guarantee. 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. 1999, Ch. 453, Sec. 25. Effective January 1, 2000.)
  9. 12377.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 2. Directors and Management [12350 - 12377] ( Chapter 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Standards of Conduct [12370 - 12377] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    A corporation may indemnify certain agents for qualifying proceedings and may also 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 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 2. Directors and Management [12350 - 12377] ( Chapter 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Standards of Conduct [12370 - 12377] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12377. (a) For the purposes of this section, “agent” means any 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 which 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 any 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) 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 that 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 any 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, 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 that 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) In respect of 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 which is settled or otherwise disposed of without court approval. (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 12224), 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 prior to 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. (g) No 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 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 any 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 any 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 the 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 12320. (Amended by Stats. 2012, Ch. 61, Sec. 4. (AB 2668) Effective January 1, 2013.)
  10. 12400.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Issuance of Memberships [12400 - 12405] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    A corporation may issue memberships, but only as allowed by its articles or bylaws.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Issuance of Memberships [12400 - 12405] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12400. 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. (Repealed and added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  11. 12401.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Issuance of Memberships [12400 - 12405] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    A cooperative corporation may issue membership certificates, but if it does, it must give purchasers a disclosure document and include specified membership information.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Issuance of Memberships [12400 - 12405] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12401. (a) A corporation may issue, but is not required to issue, membership certificates. In the event that membership certificates are issued, the certificates shall state the information required to be contained in the disclosure document described in subdivision (b). 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) Except as provided in subdivision (e), prior to issuing a membership, the corporation shall provide the purchaser of a membership with a disclosure document. The disclosure document may be a prospectus, offering circular, brochure, or similar document, a specimen copy of the membership certificate, or a receipt which the corporation proposes to issue. The disclosure document shall contain the following information: (1) A statement that the corporation is a cooperative corporation. (2) A statement that a copy of the corporation’s articles and bylaws will be furnished without charge to a member or prospective member upon written request, and the address of the office of the corporation and the address to which such a written request is to be directed. (3) If there are restrictions imposed by the corporation upon the transfer of membership, a statement to that effect and the restrictions imposed on transfer. (4) If the corporation may levy dues, assessments, or membership or transfer fees, a statement to that effect and the conditions under which the corporation may make such a levy. (5) If the member is required to contribute services to the corporation, a statement to that effect and the amount and nature of the services to be contributed to the corporation. (6) Whether the membership is redeemable and the conditions under which the membership may be redeemed at the option of the corporation or the member. (7) If the voting power or the proprietary interests of the members is unequal, a statement to that effect and the rule or rules by which the voting power and proprietary rights are to be determined. (8) In lieu of specifying verbatim in the disclosure document the restrictions on the transfer of a membership, conditions of levy, amount and nature of services to be contributed, conditions under which memberships are redeemable, or the rules by which the voting power and proprietary rights of members are to be determined, the disclosure document may contain a statement that such information will be provided free of charge to a member or prospective member who requests it in writing. If the disclosure document contains such a statement it shall also set forth the address of the office of the corporation and the address to which such a request is to be directed. (c) If the articles or bylaws are amended so that any statement required by subdivision (a) on outstanding membership certificates is no longer accurate, the board may cancel the outstanding certificates and issue in their place new certificates conforming to the articles or bylaws amendments. (d) When new membership certificates are issued in accordance with subdivision (c), 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 the certificate to be surrendered shall not be entitled to exercise any of the rights of membership until the certificate is surrendered, but such rights shall be suspended only after notice of the order is given to the holder of the certificate and only until the certificate is surrendered. The requirement to surrender outstanding certificates may be enforced by civil action. (e) A corporation shall issue a membership certificate, receipt, or written advice of purchase to anyone purchasing a membership upon the member’s first purchase of a membership of any class. No disclosure document need be provided to an existing member prior to the purchase of additional memberships if that member has previously been provided with a disclosure document which is accurate and correct as of the date of the purchase of the additional memberships. (f) If a corporation does not issue new certificates as contemplated by subdivisions (c) and (d), and if a transferee of a membership certificate has not previously been provided with a disclosure statement which is accurate and correct as of the date of registration of the transfer, then the corporation shall provide a disclosure document to the transferee upon registration with the corporation of the transfer of the certificate. (Amended by Stats. 1983, Ch. 792, Sec. 19.)
  12. 12402.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Issuance of Memberships [12400 - 12405] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    A corporation may replace a lost, stolen, or destroyed membership certificate, and may require a bond or other adequate security before doing so.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Issuance of Memberships [12400 - 12405] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12402. (a) A corporation may issue a new membership certificate 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. (Repealed and added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  13. 12403.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Issuance of Memberships [12400 - 12405] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    A corporation may admit any person to membership unless subdivision (b), its articles, or its bylaws say otherwise, but 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 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Issuance of Memberships [12400 - 12405] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12403. (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 to membership. (Repealed and added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  14. 12404.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Issuance of Memberships [12400 - 12405] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    Members with voting rights must have equal voting power, except where Sections 12314 or 12404.5 permit otherwise.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Issuance of Memberships [12400 - 12405] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12404. Except as permitted in Sections 12314 and 12404.5, the voting power of members having voting rights shall be equal. (Amended by Stats. 2015, Ch. 192, Sec. 14. (AB 816) Effective January 1, 2016.)
  15. 12404.5.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Issuance of Memberships [12400 - 12405] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    Worker-members of a worker cooperative and community investors have voting power, but only as provided in Section 12253.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Issuance of Memberships [12400 - 12405] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12404.5. (a) The worker-members of a worker cooperative shall have voting power as provided in subdivision (a) of Section 12253. (b) Community investors have voting power only as provided in subdivision (c) of Section 12253. (Added by Stats. 2015, Ch. 192, Sec. 15. (AB 816) Effective January 1, 2016.)
  16. 12405.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Issuance of Memberships [12400 - 12405] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    Proxy voting is not allowed.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Issuance of Memberships [12400 - 12405] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12405. There shall be no voting by proxy. (Amended by Stats. 1983, Ch. 792, Sec. 20.)
  17. 12410.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 2. Transfer of Memberships [12410- 12410.] ( Article 2 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    By default, a member may not transfer a membership or related rights unless the articles or bylaws allow it.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 2. Transfer of Memberships [12410- 12410.] ( Article 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12410. (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), Section 12422, and Section 12445, all rights as a member of the corporation cease upon the member’s death or dissolution or the dissolution of a member which is a business entity. (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. (Amended by Stats. 1983, Ch. 792, Sec. 21.)
  18. 12420.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Types of Memberships [12420 - 12422] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    Corporations may issue different membership classes and, if voting memberships exist, may issue additional classes; worker-members must get their rights from the articles or bylaws, memberships cannot be split into partial memberships, and worker cooperatives may make patronage distributions only to the worker-member class.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Types of Memberships [12420 - 12422] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12420. (a) Except as provided in subdivision (b), a corporation may issue memberships having different rights, privileges, preferences, restrictions, or conditions, as provided in its articles or bylaws. If the articles or bylaws authorize at least one class of voting memberships, a corporation may also authorize and issue additional classes of memberships, preferred or otherwise, that are divisible into a series or are nonvoting or both. (b) All worker-members shall have the rights, privileges, preferences, restrictions, or conditions as provided in the articles or bylaws. This membership shall not be divided into partial memberships. (c) A worker cooperative shall only make patronage distributions to the worker-member class. (Amended by Stats. 2015, Ch. 192, Sec. 16. (AB 816) Effective January 1, 2016.)
  19. 12421.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Types of Memberships [12420 - 12422] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    All memberships must be treated the same for rights and related terms, unless the articles or bylaws provide otherwise.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Types of Memberships [12420 - 12422] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12421. Except as provided in the articles or bylaws, all memberships shall have the same rights, privileges, preferences, restrictions and conditions. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  20. 12422.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Types of Memberships [12420 - 12422] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    Memberships are not redeemable unless the corporation’s articles or bylaws allow it.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Types of Memberships [12420 - 12422] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12422. (a) Unless the corporation’s articles or bylaws so provide, memberships are not redeemable. A corporation may provide in its articles or bylaws for one or more classes or series of memberships which are redeemable, in whole or in part, for such consideration within such time or upon the happening of one or more specified events and upon the terms and conditions stated in the articles or bylaws. However, no membership shall actually be redeemed if prohibited by Chapter 4 (commencing with Section 12450). (b) Nothing in this section shall prevent a corporation from creating a sinking fund or similar provision for, or entering into an agreement for, the redemption or purchase of its memberships to the extent permitted by Chapter 4 (commencing with Section 12450). (Amended by Stats. 2013, Ch. 538, Sec. 7. (AB 1255) Effective January 1, 2014.)
  21. 12430.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 4. Termination of Memberships [12430 - 12431] ( Article 4 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    A member may resign at any time, but the bylaws or articles may require reasonable notice. The member remains responsible for certain existing obligations, and a time-limited 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 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 4. Termination of Memberships [12430 - 12431] ( Article 4 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12430. (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. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  22. 12431.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 4. Termination of Memberships [12430 - 12431] ( Article 4 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    A member cannot be expelled, suspended, or terminated unless the section’s procedures are followed, and a court may grant relief if a challenge succeeds.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 4. Termination of Memberships [12430 - 12431] ( Article 4 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12431. (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 that conforms to the requirements of subdivision (c) or (d) 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 if all of the following occur: (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. (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 expulsion, suspension, or termination or arising from contract or otherwise. (Amended by Stats. 2015, Ch. 192, Sec. 17. (AB 816) Effective January 1, 2016.)
  23. 12440.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 5. Rights and Obligations of Members and Creditors [12440 - 12446] ( Article 5 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    A corporation member is generally not personally liable for the corporation’s debts, liabilities, or obligations.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 5. Rights and Obligations of Members and Creditors [12440 - 12446] ( Article 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12440. (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. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  24. 12441.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 5. Rights and Obligations of Members and Creditors [12440 - 12446] ( Article 5 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    A corporation may charge members dues, assessments, or fees under its articles or bylaws, but members may avoid liability by promptly resigning unless a listed exception applies, and creditors may not sue to force collection from members.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 5. Rights and Obligations of Members and Creditors [12440 - 12446] ( Article 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12441. 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. Unless called to the attention of the member and agreed to in writing by the member, article or bylaw provisions authorizing such dues, assessments or fees do not, of themselves, create such liability. No action shall be brought by or on behalf of any creditor to levy or to require the levy of dues, assessments or fees upon the members of the corporation. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  25. 12442.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 5. Rights and Obligations of Members and Creditors [12440 - 12446] ( Article 5 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    A person holding a cooperative membership in a fiduciary or representative capacity is not personally liable for certain unpaid membership-related amounts.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 5. Rights and Obligations of Members and Creditors [12440 - 12446] ( Article 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12442. 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. 792, Sec. 22.)
  26. 12443.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 5. Rights and Obligations of Members and Creditors [12440 - 12446] ( Article 5 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    Creditors generally cannot sue to reach a member’s liability to the corporation unless they first obtain judgment against the corporation and execution is unsatisfied, or the proceedings would be useless.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 5. Rights and Obligations of Members and Creditors [12440 - 12446] ( Article 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12443. (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. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  27. 12444.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 5. Rights and Obligations of Members and Creditors [12440 - 12446] ( Article 5 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    This section says the article does not limit any fraud- or illegality-related rights or remedies that a creditor, member, or the corporation may have.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 5. Rights and Obligations of Members and Creditors [12440 - 12446] ( Article 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12444. 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 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. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  28. 12445.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 5. Rights and Obligations of Members and Creditors [12440 - 12446] ( Article 5 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    The articles or bylaws must state how member capital shares are determined and, if repayable, when and how repayment happens; they must also state how to value a member’s interest and when the corporation must buy it from a terminated member, if required.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 5. Rights and Obligations of Members and Creditors [12440 - 12446] ( Article 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12445. The articles or bylaws shall prescribe: (a) The manner of determining each member’s share of the capital of the corporation contributed by the members and, if repayable, the time and manner for its repayment; and (b) The manner of determining the value, if any, of the member’s interest in the corporation apart from contributed capital and the time and manner of the corporation’s purchase, if required, of such interest from a terminated member. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  29. 12446.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 5. Rights and Obligations of Members and Creditors [12440 - 12446] ( Article 5 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    A consumer cooperative corporation can take certain proprietary interests instead of state escheat only if its articles or bylaws specifically authorize the transfer, it gives at least 60 days’ prior notice, and the affected member does not file a written objection before the proposed transfer date.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 3. Members [12400 - 12446] ( Chapter 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 5. Rights and Obligations of Members and Creditors [12440 - 12446] ( Article 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12446. (a) Subject to subdivision (b), Chapter 7 (commencing with Section 1500) of Title 10 of Part 3 of the Code of Civil Procedure shall not apply to any proprietary interest in a consumer cooperative corporation. Any proprietary interest that would otherwise escheat to the state pursuant to Chapter 7 (commencing with Section 1500) of Title 10 of Part 3 of the Code of Civil Procedure shall instead become the property of the corporation. (b) Notwithstanding subdivision (a), no proprietary interest shall become the property of the corporation under this section unless the following requirements are satisfied: (1) The articles or bylaws shall specifically provide for the transfer of ownership of the otherwise escheated proprietary interests to the corporation. (2) At least 60 days prior notice of the proposed transfer of the proprietary interest to the corporation is given to the affected member by first-class or second-class mail to the last address of the member shown on the corporation’s records, and by publication in a newspaper of general circulation in the county in which the corporation has its principal office. Notice given in the foregoing manner shall be deemed actual notice. (3) No proprietary interest shall become the property of the corporation under this section if written notice objecting thereto is received by the corporation from the affected member prior to the date of the proposed transfer. (c) For purposes of this section, a “proprietary interest” shall mean and include any membership, membership certificate, membership share, or share certificate of any class or series representing a proprietary interest in, and issued by, the corporation together with all accrued and unpaid dividends and patronage distributions relating thereto. (Amended by Stats. 2013, Ch. 538, Sec. 8. (AB 1255) Effective January 1, 2014.)
  30. 12450.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 4. Distributions [12450 - 12455] ( Chapter 4 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Limitations [12450 - 12454.5] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    This section says the chapter does not apply to proceedings for winding up and dissolution of corporations under Chapters 15, 16, and 17.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 4. Distributions [12450 - 12455] ( Chapter 4 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Limitations [12450 - 12454.5] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12450. This chapter does not apply to any proceeding for winding up and dissolution of corporations under Chapters 15 (commencing with Section 12620), 16 (commencing with Section 12630), and 17 (commencing with Section 12650). (Repealed and added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  31. 12451.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 4. Distributions [12450 - 12455] ( Chapter 4 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Limitations [12450 - 12454.5] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    In any fiscal year, distributions under Section 12235 must not exceed 15% of contributions to capital.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 4. Distributions [12450 - 12455] ( Chapter 4 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Limitations [12450 - 12454.5] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12451. Distributions (Section 12235) in any fiscal year shall not exceed 15 percent, multiplied by contributions (whether by membership fees, capital credits, or otherwise) to capital. (Amended by Stats. 1983, Ch. 792, Sec. 23.)
  32. 12452.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 4. Distributions [12450 - 12455] ( Chapter 4 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Limitations [12450 - 12454.5] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    A corporation may purchase or redeem memberships, but only if it meets Section 12453’s requirements and any additional restrictions authorized by Section 12454.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 4. Distributions [12450 - 12455] ( Chapter 4 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Limitations [12450 - 12454.5] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12452. A corporation may, subject to meeting the requirements of Section 12453 and any additional restrictions authorized by Section 12454, purchase or redeem memberships. (Amended by Stats. 1985, Ch. 378, Sec. 7.)
  33. 12453.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 4. Distributions [12450 - 12455] ( Chapter 4 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Limitations [12450 - 12454.5] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    A corporation and its subsidiaries must not buy back memberships, make certain patronage distributions, or make other distributions 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 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 4. Distributions [12450 - 12455] ( Chapter 4 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Limitations [12450 - 12454.5] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12453. Neither a corporation nor any of its subsidiaries shall purchase or redeem memberships, or make a patronage distribution to members out of earnings of the corporation on nonmember patronage, or make a distribution, if the corporation or the subsidiary purchasing or redeeming memberships or 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. (Repealed and added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  34. 12454.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 4. Distributions [12450 - 12455] ( Chapter 4 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Limitations [12450 - 12454.5] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    This section allows a cooperative corporation to impose extra restrictions on membership purchases or redemptions, distributions, and patronage distributions through its articles, bylaws, or an agreement.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 4. Distributions [12450 - 12455] ( Chapter 4 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Limitations [12450 - 12454.5] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12454. Nothing in this chapter prohibits additional restrictions upon the purchase or redemption of a membership, upon distributions, or upon patronage distributions, by provision in a corporation’s articles or bylaws or agreement entered into by the corporation. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  35. 12454.5.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 4. Distributions [12450 - 12455] ( Chapter 4 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Limitations [12450 - 12454.5] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    A worker cooperative may create an indivisible reserves account, but it cannot distribute that account to members.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 4. Distributions [12450 - 12455] ( Chapter 4 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Limitations [12450 - 12454.5] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12454.5. (a) A worker cooperative may create an indivisible reserves account that shall not be distributed to members. (b) Funds in the indivisible reserves account shall only derive from non-patronage-sourced income, in a manner provided in the articles or bylaws, or by the board, and shall be used as capital for the cooperative. (Added by Stats. 2015, Ch. 192, Sec. 18. (AB 816) Effective January 1, 2016.)
  36. 12455.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 4. Distributions [12450 - 12455] ( Chapter 4 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 2. Liability of Members [12455- 12455.] ( Article 2 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    A person who knowingly receives a prohibited distribution or membership redemption payment is liable to the corporation for the amount received plus interest. Certain creditors may sue in the corporation’s name, and a sued person may bring in other liable persons and seek contribution if there is no fraud by the moving party.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 4. Distributions [12450 - 12455] ( Chapter 4 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 2. Liability of Members [12455- 12455.] ( Article 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12455. (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 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 liabilities of the corporation owed to nonconsenting creditors at the time of the violation. (c) Suit may be brought in the name of the corporation to enforce the liability to creditors arising under subdivision (b) for a violation of Section 12452 or 12453 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. (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. (Amended by Stats. 1984, Ch. 812, Sec. 17.)
  37. 12460.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 5. Meetings and Voting [12460 - 12477] ( Chapter 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. General Provisions [12460 - 12466] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    This section sets rules for cooperative corporation member meetings, including when and where they may be held, how remote participation can work, and when courts can order a meeting or ballot.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 5. Meetings and Voting [12460 - 12477] ( Chapter 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. General Provisions [12460 - 12466] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12460. (a) Meetings of members may be held at a place within or without this state that is stated in or fixed in accordance with the bylaws. If no other place is so stated or 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 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, and vote at a meeting of members, subject to subdivision (f). (b) Except as provided in Section 12460.5, a regular meeting of members shall be held annually. In any year in which directors are elected, the election shall be held at the regular meeting unless the directors are chosen in some other manner authorized by law. Any other proper business may be transacted at the meeting. (c) If a corporation 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, after notice to the corporation giving it an opportunity to be heard. (d) The votes represented 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 provision 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 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, however, in a worker cooperative with more than four worker-members, a special meeting may only be called by the greater of three worker-members or 5 percent of the worker-members. In a worker cooperative with fewer than four worker-members, special meetings may be called by one worker-member. (f) A meeting of the members may be conducted, in whole or in part, by electronic transmission by and to the corporation, by electronic video screen communication, conference telephone, or other means of remote communication if the corporation implements reasonable measures: (1) to provide members 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 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. 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 12320; 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 may participate provided that the choice between participating via audiovisual or via audio-only means is made by the member 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. 41. (AB 1170) Effective January 1, 2026.)
  38. 12460.5.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 5. Meetings and Voting [12460 - 12477] ( Chapter 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. General Provisions [12460 - 12466] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    A collective board worker cooperative does not have to hold an annual meeting of members.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 5. Meetings and Voting [12460 - 12477] ( Chapter 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. General Provisions [12460 - 12466] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12460.5. Notwithstanding Section 12460, a collective board worker cooperative shall not be required to hold an annual meeting of members. (Added by Stats. 2015, Ch. 192, Sec. 20. (AB 816) Effective January 1, 2016.)
  39. 12461.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 5. Meetings and Voting [12460 - 12477] ( Chapter 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. General Provisions [12460 - 12466] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    This section sets notice rules for members’ meetings in cooperative corporations, including timing, delivery methods, required contents, and special rules for worker cooperatives, adjourned meetings, and written ballots.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 5. Meetings and Voting [12460 - 12477] ( Chapter 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. General Provisions [12460 - 12466] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12461. (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. A worker cooperative shall provide notice of the meeting not less than 48 hours before the meeting if the meeting is a meeting of only worker-members, provided that the notice is delivered personally to every worker-member. Subject to subdivision (f), and subdivision (b) of Section 12462, that 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 12462, any proper matter may be presented at the meeting for such 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 the corporation, or by mail or other means of written communication, addressed to a member at the address of such 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 12320. 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 such member appearing on the books of the corporation is returned to the corporation by the United States Postal Service marked to indicate the United States Postal Service is unable to deliver the notice or report to the member at such 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 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. At the adjourned meeting the corporation may transact any business which might have been transacted at the original meeting. If the adjournment is for more than 45 days or if after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each member of record 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, and if, either before or after the meeting, each of the persons entitled to vote, not present in person, 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 such 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 such 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 12362, 12364, 12373, 12502, or 12658 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. (h) Subject to the provisions of subdivision (i), and unless prohibited by the articles or bylaws, before any regular or special meeting of members, the board may authorize distribution of a written ballot to every member entitled to vote at the meeting. Such ballot shall set forth the action proposed to be taken at the meeting, shall provide an opportunity to specify approval or disapproval of the proposed action, and shall state that unless revoked by the member voting in person at the meeting, the ballot will be counted if received by the corporation on or before the time of the meeting with respect to which it was sent. If ballots are so distributed with respect to a meeting, the number of members voting at the meeting by unrevoked written ballots shall be deemed present at the meeting for purposes of determining the existence of a quorum pursuant to subdivision (a) of Section 12462 but only with respect to the proposed action referred to in the ballots. These ballots shall be distributed in a manner consistent with the requirements of subdivision (b) and Section 12464. (i) Unless prohibited by the articles or bylaws, written ballots may be distributed in a manner contemplated by subdivision (h) with respect to the election of directors, except that no ballots may be so distributed with respect to the election of directors if cumulative voting is permitted pursuant to Section 12484. (Amended by Stats. 2022, Ch. 617, Sec. 80. (SB 1202) Effective January 1, 2023.)
  40. 12462.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 5. Meetings and Voting [12460 - 12477] ( Chapter 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. General Provisions [12460 - 12466] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    This section sets the quorum and voting rules for members’ meetings, including when bylaws may change the quorum and when meetings may adjourn or keep transacting business.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 5. Meetings and Voting [12460 - 12477] ( Chapter 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. General Provisions [12460 - 12466] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12462. (a) The lesser of 250 members or members representing 5 percent of the voting power, 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 12224). 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 corporation is authorized 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 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 12461. (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 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 in person, but no other business may be transacted, except as provided in subdivision (c). (Amended by Stats. 2000, Ch. 485, Sec. 17. Effective January 1, 2001.)
  41. 12463.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 5. Meetings and Voting [12460 - 12477] ( Chapter 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. General Provisions [12460 - 12466] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    This section allows certain member actions to be taken by written ballot instead of a meeting, if the ballot is sent to every voting member and the section’s conditions are met.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 5. Meetings and Voting [12460 - 12477] ( Chapter 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. General Provisions [12460 - 12466] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12463. (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 12461 and Section 12464. 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 12484. 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 printing and distributing of the written ballots. (f) The secretary shall cause a vote to be taken by written ballot upon any action or recommendation proposed in writing by 20 percent of the members of the corporation. (Amended by Stats. 2004, Ch. 254, Sec. 40. Effective January 1, 2005.)
  42. 12464.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 5. Meetings and Voting [12460 - 12477] ( Chapter 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. General Provisions [12460 - 12466] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    Written ballots meeting the member-count threshold must let members choose approval or disapproval, follow the member’s choice, and exclude withheld director votes from being counted.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 5. Meetings and Voting [12460 - 12477] ( Chapter 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. General Provisions [12460 - 12466] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12464. (a) Any form of written ballot distributed to 10 or more members of a corporation with 100 or more members shall afford an opportunity on the 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 is distributed, to be acted upon 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 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 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 written ballot and the superior court may compel compliance therewith at the suit of any member. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  43. 12465.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 5. Meetings and Voting [12460 - 12477] ( Chapter 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. General Provisions [12460 - 12466] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    A court may authorize alternative meeting or voting procedures for a corporation when normal procedures are impractical or unduly difficult.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 5. Meetings and Voting [12460 - 12477] ( Chapter 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. General Provisions [12460 - 12466] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12465. (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. However, 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. 34.)
  44. 12466.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 5. Meetings and Voting [12460 - 12477] ( Chapter 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. General Provisions [12460 - 12466] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    A cooperative corporation may accept or reject ballots, consents, waivers, and proxy appointments under stated good-faith conditions, and good-faith actors are protected from damages liability.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 5. Meetings and Voting [12460 - 12477] ( Chapter 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. General Provisions [12460 - 12466] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12466. (a) If the name signed on a ballot, consent or waiver corresponds to the name of a member, the corporation if acting in good faith is entitled to accept the ballot, consent, or waiver and give it effect as the act of the member. (b) If the name signed on a ballot, consent, or waiver does not correspond to the record name of a member, the corporation if acting in good faith is nevertheless entitled to accept the vote, consent, or waiver 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 vote, consent or waiver. (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. (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. 51. Effective January 1, 1997.)
  45. 12470.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 5. Meetings and Voting [12460 - 12477] ( Chapter 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 2. Additional Provisions Relating to Election of Directors [12470 - 12477] ( Article 2 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    For directors elected by members, reasonable nomination and election procedures must be available to the members, considering the corporation’s nature, size, and operations.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 5. Meetings and Voting [12460 - 12477] ( Chapter 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 2. Additional Provisions Relating to Election of Directors [12470 - 12477] ( Article 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12470. 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. (Amended by Stats. 1996, Ch. 589, Sec. 52. Effective January 1, 1997.)
  46. 12473.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 5. Meetings and Voting [12460 - 12477] ( Chapter 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 2. Additional Provisions Relating to Election of Directors [12470 - 12477] ( Article 2 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    If a corporation sends out voting material for a director nominee in a publication it owns or controls, it must give every other nominee equal space and equal prominence in that same material.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 5. Meetings and Voting [12460 - 12477] ( Chapter 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 2. Additional Provisions Relating to Election of Directors [12470 - 12477] ( Article 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12473. Where a corporation distributes any material soliciting a vote for any nominee for director in any publication owned or controlled by the corporation, it shall make available to each other nominee, in the same material, an equal amount of space, with equal prominence, to be used by the nominee for a purpose reasonably related to the election. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  47. 12474.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 5. Meetings and Voting [12460 - 12477] ( Chapter 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 2. Additional Provisions Relating to Election of Directors [12470 - 12477] ( Article 2 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    If a board-election nominee asks in writing and pays mailing costs, the corporation must mail the nominee’s election-related material to members within 10 business days, unless it gives the nominee certain Section 12600 rights within 5 business days.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 5. Meetings and Voting [12460 - 12477] ( Chapter 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 2. Additional Provisions Relating to Election of Directors [12470 - 12477] ( Article 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12474. Upon written request by any nominee for election to the board and the payment of the reasonable costs of mailing (including postage), a 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 12600. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  48. 12475.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 5. Meetings and Voting [12460 - 12477] ( Chapter 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 2. Additional Provisions Relating to Election of Directors [12470 - 12477] ( Article 2 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    A corporation generally may not refuse to publish or mail required nominee material because of its content, but it may seek a court order if the material would expose it to liability.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 5. Meetings and Voting [12460 - 12477] ( Chapter 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 2. Additional Provisions Relating to Election of Directors [12470 - 12477] ( Article 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12475. (a) Except as provided in subdivision (c), no corporation may decline to publish or mail material, otherwise required to be published or mailed on behalf of any nominee under this article, on the basis of the content of such material. (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 pursuant to Section 12473 or 12474 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 relieving the corporation from its obligation under Section 12473 or 12474 on the ground the material will expose the moving party to liability. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  49. 12476.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 5. Meetings and Voting [12460 - 12477] ( Chapter 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 2. Additional Provisions Relating to Election of Directors [12470 - 12477] ( Article 2 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

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

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 5. Meetings and Voting [12460 - 12477] ( Chapter 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 2. Additional Provisions Relating to Election of Directors [12470 - 12477] ( Article 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12476. 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. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  50. 12477.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 5. Meetings and Voting [12460 - 12477] ( Chapter 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 2. Additional Provisions Relating to Election of Directors [12470 - 12477] ( Article 2 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    A 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 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 5. Meetings and Voting [12460 - 12477] ( Chapter 5 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 2. Additional Provisions Relating to Election of Directors [12470 - 12477] ( Article 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12477. 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 if the only defect in the election, appointment or removal is the failure to give notice as provided in this part or in the corporation’s articles or bylaws. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  51. 12480.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 6. Voting of Memberships [12480 - 12485] ( Chapter 6 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    A member entitled to vote generally gets one vote on each matter put to the members, subject to stated exceptions.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 6. Voting of Memberships [12480 - 12485] ( Chapter 6 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12480. Except as provided in Sections 12314 and 12484, each member entitled to vote 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 12482. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  52. 12481.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 6. Voting of Memberships [12480 - 12485] ( Chapter 6 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    The board, or the bylaws, may set record dates for which members get notice, may vote, may cast written ballots, or may exercise other rights, subject to timing limits.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 6. Voting of Memberships [12480 - 12485] ( Chapter 6 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12481. (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 60 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 ajournment 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 12463). 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. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  53. 12482.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 6. Voting of Memberships [12480 - 12485] ( Chapter 6 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    This section says that where one membership is held in the names of two or more persons, voting by one person can bind all, or if more than one vote is cast, the majority binds all, unless the articles, bylaws, or required notice say otherwise.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 6. Voting of Memberships [12480 - 12485] ( Chapter 6 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12482. Unless otherwise provided in the articles or bylaws, 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 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 vote, 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. 24. (SB 1005) Effective January 1, 2017.)
  54. 12483.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 6. Voting of Memberships [12480 - 12485] ( Chapter 6 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    The board may appoint election inspectors before a members’ meeting, and if none are appointed or they cannot act, the chairperson may — and on a member’s request must — appoint them at the meeting.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 6. Voting of Memberships [12480 - 12485] ( Chapter 6 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12483. (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 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, the majority of members represented in person shall determine whether one or three inspectors are to be appointed. (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, 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. 81. (SB 1202) Effective January 1, 2023.)
  55. 12484.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 6. Voting of Memberships [12480 - 12485] ( Chapter 6 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    This section limits cumulative voting in director elections and lets members use it only in a central organization when the articles or bylaws authorize it.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 6. Voting of Memberships [12480 - 12485] ( Chapter 6 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12484. (a) Except in the case of a central organization, cumulative voting shall not be permitted. In the case of a central organization, if the articles or bylaws authorize cumulative voting, but not otherwise, every member entitled to vote at any election of directors may cumulate such 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 12224), 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 such 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 such notice, all members may cumulate their votes for candidates in nomination. (c) In any election of directors of a central organization by cumulative voting, the candidates receiving the highest number of votes are elected, subject to any lawful provision specifying election by classes. In any other election of directors, unless otherwise provided in the articles or bylaws, the candidates receiving the highest number of votes are elected. (d) 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. 17.5.)
  56. 12485.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 6. Voting of Memberships [12480 - 12485] ( Chapter 6 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    The court must decide whether a director election or appointment is valid, set a hearing quickly, and ensure notice is served on the corporation and other named persons.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 6. Voting of Memberships [12480 - 12485] ( Chapter 6 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12485. (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) 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, 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. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  57. 12490.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 7. Members’ Derivative Actions [12490- 12490.] ( Chapter 7 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    This section limits when members can bring a corporation-rights action and lets the corporation or certain defendants seek security from the plaintiff.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 7. Members’ Derivative Actions [12490- 12490.] ( Chapter 7 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12490. (a) Subdivisions (c) through (f) notwithstanding, no motion to require security shall be granted in an action brought by the lesser of 100 members or 5 percent of the members. (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 security 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 nature and amount of security, 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 12377. A ruling by the court on the motion shall not be a determination of any issue in the action or of the merits thereof. The amount of the security may thereafter be increased or decreased in the discretion of the court upon a showing that the security provided has or may become inadequate or is excessive, but the court may not in any event increase the total amount of the security beyond fifty thousand dollars ($50,000) in the aggregate for all defendants. If the court, upon any such motion, makes a determination that security 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 security required by the court shall have been furnished within such reasonable time as may be fixed by the court. The corporation and the moving party shall have recourse to the security in such amount as the court shall determine upon the termination of the action. (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, post good and sufficient 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 security theretofore made pursuant hereto, and any such motion then pending shall be dismissed and no further or additional bond or other security 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. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  58. 12500.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 8. Amendment of Articles [12500 - 12510] ( Chapter 8 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    A corporation may amend its articles if it follows this chapter, but it may not change certain original address and officer details except to fix an error or delete them after filing a Section 12570 statement.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 8. Amendment of Articles [12500 - 12510] ( Chapter 8 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12500. (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 12504 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 12570. (Amended by Stats. 2012, Ch. 494, Sec. 29. (SB 1532) Effective January 1, 2013.)
  59. 12501.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 8. Amendment of Articles [12500 - 12510] ( Chapter 8 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    A majority of the incorporators may adopt an amendment of the articles by a signed writing if no directors were named in the original articles, no directors have been elected, and the corporation has no members.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 8. Amendment of Articles [12500 - 12510] ( Chapter 8 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12501. 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. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  60. 12502.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 8. Amendment of Articles [12500 - 12510] ( Chapter 8 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    This section says amendments to the articles usually need board approval and member approval, but some listed amendments can be approved by the board alone.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 8. Amendment of Articles [12500 - 12510] ( Chapter 8 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12502. (a) Except as provided in this section or Section 12503, amendments may be adopted if approved by the board and approved by the members 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. (4) Any amendment authorized in the articles pursuant to subdivision (c) of Section 12313 fixing the rights, privileges, preferences, restrictions, and conditions attaching to any wholly unissued class of memberships. (5) Any amendment authorized in the articles pursuant to subdivision (c) of Section 12313 fixing the designation, number of memberships and the rights, privileges, preferences, restrictions, and conditions attaching to any wholly unissued series of memberships, or an increase or decrease in the number of memberships of any series. (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 a greater vote shall not be altered, amended or repealed except by the class or the greater vote, unless otherwise provided in the articles. (Amended by Stats. 2013, Ch. 538, Sec. 9. (AB 1255) Effective January 1, 2014.)
  61. 12503.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 8. Amendment of Articles [12500 - 12510] ( Chapter 8 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    Some amendments need approval from the affected class or series members.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 8. Amendment of Articles [12500 - 12510] ( Chapter 8 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12503. (a) An amendment shall also be approved by the members (Section 12224) of a class, whether or not the class is entitled to vote thereon by the provisions of the articles, if the amendment would do any of the following: (1) Materially and adversely affect the rights, privileges, preferences, restrictions or conditions of that class as to voting, dissolution, redemption or transfer, or the obligations of that class, 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 the number of memberships authorized for the 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 the class. (6) Authorize a new class of memberships. (b) An amendment shall also be approved by the members of a series whether or not the series is entitled to vote thereon by the articles or bylaws if the series is adversely affected by the amendment in a different manner than other shares of the same class. (Amended by Stats. 2013, Ch. 538, Sec. 10. (AB 1255) Effective January 1, 2014.)
  62. 12504.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 8. Amendment of Articles [12500 - 12510] ( Chapter 8 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    A corporation may amend its articles to change its status to certain other corporation types 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 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 8. Amendment of Articles [12500 - 12510] ( Chapter 8 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12504. (a) A corporation may amend its articles to change its status to that of a nonprofit public benefit corporation, a nonprofit mutual benefit corporation, a nonprofit religious corporation, a business corporation, or a social purpose corporation by complying with this section and the other sections of this chapter. (b) Except as authorized by Section 12501 or unless the corporation has no members, an amendment to change its status to a nonprofit public benefit corporation or a nonprofit religious corporation shall: (1) be approved by the members (Section 12224), and the fairness of the amendment to the members shall be approved by the Commissioner of Financial Protection and Innovation pursuant to Section 25142; or (2) be approved by the members (Section 12224) in an election conducted by written ballot pursuant to Section 12463 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 12570), and may in addition only include those provisions which would have been permitted, in original articles filed by the type of corporation (nonprofit public benefit, nonprofit mutual benefit, nonprofit religious, business, or social purpose) into which the corporation is changing its status. (d) At the time of filing a certificate of amendment to change status to a nonprofit public benefit corporation, the Secretary of State shall make available the filed certificate to the Attorney General. (Amended by Stats. 2022, Ch. 617, Sec. 82. (SB 1202) Effective January 1, 2023.)
  63. 12505.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 8. Amendment of Articles [12500 - 12510] ( Chapter 8 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    When an amendment is adopted, the corporation must file a certificate of amendment.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 8. Amendment of Articles [12500 - 12510] ( Chapter 8 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12505. (a) 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 is in accordance with Section 12507; (2) That the amendment has been approved by the board; (3) If the amendment is one for which the approval of the members (Section 12224) 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. (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 12535 shall be in lieu of any filing required under this chapter. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  64. 12506.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 8. Amendment of Articles [12500 - 12510] ( Chapter 8 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    If incorporators adopt amendments under Section 12501, the corporation must file a certificate of amendment signed and verified by a majority of the incorporators.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 8. Amendment of Articles [12500 - 12510] ( Chapter 8 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12506. In the case of amendments adopted by the incorporators under Section 12501, 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. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  65. 12507.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 8. Amendment of Articles [12500 - 12510] ( Chapter 8 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    A certificate of amendment must state the amended wording of the articles in one of several specified ways, and if the amendment changes outstanding memberships, it must describe that effect.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 8. Amendment of Articles [12500 - 12510] ( Chapter 8 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12507. 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 striken 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. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  66. 12508.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 8. Amendment of Articles [12500 - 12510] ( Chapter 8 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    When a certificate of amendment is filed, the articles must be amended to match it, and membership changes tied to the amendment are carried out.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 8. Amendment of Articles [12500 - 12510] ( Chapter 8 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12508. 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. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  67. 12509.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 8. Amendment of Articles [12500 - 12510] ( Chapter 8 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    A limited-term corporation may amend its articles to extend its existence and, if needed, provide for perpetual existence.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 8. Amendment of Articles [12500 - 12510] ( Chapter 8 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12509. A corporation formed for a limited period may at any time subject 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 12302, 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. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  68. 12510.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 8. Amendment of Articles [12500 - 12510] ( Chapter 8 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    A corporation may file restated articles, and if the restatement also changes the articles, the filing must follow the specified amendment sections.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 8. Amendment of Articles [12500 - 12510] ( Chapter 8 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12510. (a) A corporation may restate in a single certificate the entire text of its articles as amended by filing an officers’ certificate 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 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 names, addresses, signatures and acknowledgments of the first directors and the initial street address and initial mailing address of the corporation 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 the first directors shall not be omitted prior to the time that the corporation has filed a statement under Section 12570). 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 Sections 12505 and 12506, as the case may be, and Section 12507. (b) If the certificate does not itself alter or amend the articles in any respect, it shall be approved by the board and shall be subject to the provisions of this chapter relating to an amendment of the articles not requiring approval of the members (Section 12224). 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. 32. (SB 1532) Effective January 1, 2013.)
  69. 12520.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 9. Sales of Assets [12520 - 12522] ( Chapter 9 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    The board may approve certain mortgages, deeds of trust, pledges, or other hypothecations of the corporation’s property to secure a contract or obligation.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 9. Sales of Assets [12520 - 12522] ( Chapter 9 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12520. 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 12224) shall be necessary for such action. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  70. 12521.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 9. Sales of Assets [12520 - 12522] ( Chapter 9 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

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

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 9. Sales of Assets [12520 - 12522] ( Chapter 9 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12521. (a) 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 12224) either before or after approval by the board and before or after the transaction. (b) Notwithstanding approval by the members (Section 12224), the board may abandon the proposed transaction without further action by the members, subject to the contractual rights, if any, of third parties. (c) 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. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  71. 12522.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 9. Sales of Assets [12520 - 12522] ( Chapter 9 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    A corporation’s secretary or assistant secretary may attach a certificate to an asset-transfer deed or instrument if the transaction was properly approved and the required facts are stated.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 9. Sales of Assets [12520 - 12522] ( Chapter 9 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12522. 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 12224) 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. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  72. 12530.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Merger [12530 - 12540.1] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    A corporation may merge with certain other entities, but mergers involving a nonprofit public benefit corporation or a nonprofit religious corporation need the Attorney General’s prior written consent.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Merger [12530 - 12540.1] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12530. Except as provided in Section 12530.5, any corporation may merge with another domestic corporation, foreign corporation, or other business entity. However, a merger with a nonprofit public benefit corporation or a nonprofit religious corporation must have the prior written consent of the Attorney General. (Amended by Stats. 2015, Ch. 192, Sec. 22. (AB 816) Effective January 1, 2016.)
  73. 12530.5.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Merger [12530 - 12540.1] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    A worker cooperative that has not revoked its worker-cooperative election may not merge or consolidate with a non-worker-cooperative corporation.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Merger [12530 - 12540.1] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12530.5. Notwithstanding Section 12530, a worker cooperative that has not revoked its election to be governed as a worker cooperative under Section 12310.5 shall not consolidate or merge with another corporation other than another worker cooperative. Two or more worker cooperatives may merge or consolidate in a manner consistent with this chapter. (Added by Stats. 2015, Ch. 192, Sec. 23. (AB 816) Effective January 1, 2016.)
  74. 12531.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Merger [12530 - 12540.1] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    A corporation’s board must approve a merger agreement if the corporation wants to merge, and the constituent corporations must be parties to that agreement.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Merger [12530 - 12540.1] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12531. The board of each corporation that 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 all of the following: (a) The terms and conditions of the merger. (b) The amendments, subject to Sections 12500 and 12505 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 (c) of Section 12302. (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 or securities of the constituent corporations into memberships or securities of the surviving corporation and, if any memberships or securities of any of the constituent corporations are not to be converted solely into memberships or securities of the surviving corporation, the cash, property, rights or securities of any corporation that the holders of those memberships or securities are to receive in exchange for the memberships or securities, which cash, property, rights or securities of any corporation may be in addition to or in lieu of memberships or securities of the surviving corporation or that the memberships are to be canceled without consideration. (f) Other details or provisions as are desired, if any, including, without limitation, if not prohibited by this chapter, a provision for the payment of cash in lieu of fractional memberships or for any other arrangement with respect thereto. (Amended by Stats. 1999, Ch. 453, Sec. 27. Effective January 1, 2000.)
  75. 12532.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Merger [12530 - 12540.1] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    Memberships in the same class must be treated equally when distributions of cash, property, rights, or securities are made, unless all members consent or the Commissioner approves the transaction terms and fairness.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Merger [12530 - 12540.1] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12532. Each membership of the same class of any constituent corporation (other than the cancellation of memberships held by a surviving corporation or its parent or a wholly owned subsidiary of either in a constituent corporation) shall be treated equally with respect to any distribution of cash, property, rights, or securities unless: (a) all members of the class consent or (b) the Commissioner of Financial Protection and Innovation has approved the terms and conditions of the transaction and the fairness of such terms pursuant to Section 25142. (Amended by Stats. 2022, Ch. 452, Sec. 60. (SB 1498) Effective January 1, 2023.)
  76. 12533.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Merger [12530 - 12540.1] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    Members of each class in a cooperative corporation that wants to merge must approve the merger terms. A member who voted against the merger may resign within 30 days after the merger takes effect and then gets certain post-resignation protections.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Merger [12530 - 12540.1] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12533. (a) The principal terms of the merger shall be approved by the members (Section 12224) of each class of each corporation which desires to merge. The approval by the members may be given before or after the approval by the board. (b) Any member of any constituent corporation who voted against the merger may, without prior notice, but within 30 days following the effective date of the merger, resign from membership and, in the event of resignation, shall be: (1) Thereafter excused from all contractual obligations to the corporation which have not accrued prior to resignation; and (2) Shall be entitled to the same rights as would have existed if there had been no merger and the membership had been terminated. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  77. 12534.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Merger [12530 - 12540.1] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

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

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Merger [12530 - 12540.1] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12534. 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. 83. (SB 1202) Effective January 1, 2023.)
  78. 12535.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Merger [12530 - 12540.1] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    After board and required member approval, the surviving corporation must file the merger agreement with attached officers' certificates, and the merger becomes effective subject to stated sections.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Merger [12530 - 12540.1] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12535. After approval of a merger by the board and any approval by the members under Section 12533, 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, and that the principal terms of the agreement in the form attached were duly approved by the required vote of the members. 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 12214 and subject to the provisions of Section 12539) and the several parties thereto shall be one 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. 29. Effective September 29, 2006.)
  79. 12536.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Merger [12530 - 12540.1] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    An amendment to the merger agreement may be adopted and approved by the board, and if it changes principal terms, it may also need member approval under Section 12533.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Merger [12530 - 12540.1] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12536. (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, as required by Section 12533 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. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  80. 12537.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Merger [12530 - 12540.1] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    The board may abandon a merger before it becomes effective, but only subject to any contractual rights of third parties.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Merger [12530 - 12540.1] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12537. 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 at any time before the merger is effective. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  81. 12538.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Merger [12530 - 12540.1] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    A certified copy of a merger agreement has the same evidentiary force as the original, with an exception against the state.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Merger [12530 - 12540.1] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12538. 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. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  82. 12539.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Merger [12530 - 12540.1] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    This section allows mergers among corporations, including foreign, foreign business, and domestic corporations, if the foreign corporations are authorized to merge under their formation laws.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Merger [12530 - 12540.1] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12539. (a) Subject to the provisions of Section 12530, the merger of any number of corporations with any number of foreign corporations, foreign business corporations, or domestic 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 cooperative corporation, the merger proceedings with respect to that corporation and any domestic disappearing corporation shall conform to the provisions of this chapter and other applicable laws of this state, but if the surviving corporation is a foreign corporation, then, subject to the requirements of subdivision (d) and Section 12533, 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 cooperative corporation, the agreement and the officers’ certificate of each constituent corporation shall be filed as provided in Section 12535 and thereupon, subject to subdivision (c) of Section 12214, 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 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. (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 the filing in this state regardless of the time of effectiveness as to a domestic disappearing corporation. (Amended by Stats. 2006, Ch. 773, Sec. 30. Effective September 29, 2006.)
  83. 12540.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Merger [12530 - 12540.1] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    If a merger agreement is made between a cooperative corporation and one or more business or nonprofit corporations, specified sections apply to the relevant constituent corporations.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Merger [12530 - 12540.1] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12540. If an agreement of merger is entered into between a cooperative corporation and one or more business or nonprofit corporations, Sections 12531, 12532, 12533, 12535, and 12536 shall apply to any constituent cooperative corporation. Sections 8011, 8011.5, 8012, and 8015 shall apply to any constituent mutual benefit corporation. Sections 6011, 6012, 6014, and 6015 shall apply to any constituent public benefit corporation. Sections 6014 and 6015 and subdivisions (c) and (d) of Section 9640 shall apply to any constituent religious corporation and Sections 1101, 1101.1, 1103, and 1104 shall apply to any constituent business corporation. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  84. 12540.1.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Merger [12530 - 12540.1] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    This section sets the rules for cooperative corporation mergers, including who may merge, who must approve, what the merger agreement must contain, and when filing makes the merger effective.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. Merger [12530 - 12540.1] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12540.1. (a) Any one or more corporations may merge with one or more other business entities (Section 12242.5). Subject to the provisions of Section 12530, one or more other domestic corporations or foreign corporations (Section 12237) 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, other domestic corporation, foreign corporation, and other business entity which desires to merge shall approve an agreement of merger. The board and the members of each corporation which desires to merge shall approve (Sections 12222 and 12224) the agreement of merger. The agreement of merger shall be approved on behalf of each other constituent 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 12242.6), 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 12500 and 12507, 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 subdivisions (b) and (c) of Section 12302, the same as, or similar to, the name of a disappearing party to the merger. (4) The manner, if any, of converting the memberships or securities of each of the constituent corporations into shares, memberships, interests, or other securities of the surviving party and, if any memberships or securities 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 or securities are to receive in exchange for the memberships or securities, 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 party. (5) Any other details or provisions required by the laws under which any party to the merger is organized, including, if a domestic limited partnership is a party to the merger, subdivision (a) of Section 15911.12, or, 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) Each membership of the same class of any constituent corporation (other than the cancellation of memberships held by a party to the merger or its parent or a wholly owned subsidiary of either in another constituent corporation) shall be treated equally with respect to any distribution of cash, property, rights, or securities unless (i) all members of the class consent or (ii) the commissioner has approved the terms and conditions of the transaction and the fairness of those terms pursuant to Section 25142. (d) 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. (e) 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 12224), at any time before the merger is effective. (f) 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. (g) 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 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 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 12242.6) 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 (i). 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 general partnership or foreign constituent limited liability company by one or more managers and by each 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 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 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 the 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. (h) 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 of the merger of the constituent corporations, either by themselves or together with other constituent parties, into the surviving party to the merger. (i) (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 (g) and this subdivision. (2) Subject to subdivision (c) of Section 12214 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 (g). (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 (g). 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 (g) 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 (g) automatically has the effect of a cancellation of registration for that foreign other business entity without the necessity of the filing of a certificate of cancellation. (Amended by Stats. 2012, Ch. 419, Sec. 13. (SB 323) Effective January 1, 2013. Operative January 1, 2014, by Sec. 32 of Ch. 419.)
  85. 12550.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 2. Effect of Merger [12550 - 12552] ( Article 2 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    When a merger happens under this chapter, the surviving party takes over the disappearing parties’ rights and property and becomes responsible for their debts, liabilities, and trust obligations.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 2. Effect of Merger [12550 - 12552] ( Article 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12550. (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 these 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. 25.2. Effective January 1, 2000.)
  86. 12550.5.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 2. Effect of Merger [12550 - 12552] ( Article 2 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    After a merger, the surviving entity takes on the disappearing entity’s tax filing and tax payment liabilities, and 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 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 2. Effect of Merger [12550 - 12552] ( Article 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12550.5. (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. 32. Effective September 29, 2006.)
  87. 12551.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 2. Effect of Merger [12550 - 12552] ( Article 2 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    If a merging corporation or business entity owns real property in California, filing certain merger documents in the county recorder’s office can serve as evidence that the surviving party owns that property.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 2. Effect of Merger [12550 - 12552] ( Article 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12551. Whenever a domestic or foreign corporation or other business entity (Section 12242.5) 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 the disappearing party to the merger in and to the real property located in that county. (Amended by Stats. 1999, Ch. 437, Sec. 25.4. Effective January 1, 2000.)
  88. 12552.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 2. Effect of Merger [12550 - 12552] ( Article 2 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    A transfer or gift made to a constituent corporation that is payable or takes effect after a merger goes to the surviving party.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 10. Mergers [12530 - 12552] ( Chapter 10 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 2. Effect of Merger [12550 - 12552] ( Article 2 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12552. 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. 25.6. Effective January 1, 2000.)
  89. 12560.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 11. Bankruptcy Reorganizations and Arrangements [12560- 12560.] ( Chapter 11 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    Certain U.S. corporate reorganization proceedings must be handled under Chapter 14 of Division 1 of Title 1, with two wording substitutions for this section.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 11. Bankruptcy Reorganizations and Arrangements [12560- 12560.] ( Chapter 11 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12560. 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. 25. (AB 1059) Effective January 1, 2010.)
  90. 12570.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 12. Required Filings by Corporation or Its Agent [12570 - 12576] ( Chapter 12 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    Corporations must file an initial and annual statement with the Secretary of State, including specified officer, address, and agent information.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 12. Required Filings by Corporation or Its Agent [12570 - 12576] ( Chapter 12 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12570. (a) Every corporation shall, within 90 days after the filing of its original articles and annually thereafter during the applicable filing period in each year, 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 or general manager, 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 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, the corporation shall include 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 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. 84. (SB 1202) Effective January 1, 2023.)
  91. 12571.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 12. Required Filings by Corporation or Its Agent [12570 - 12576] ( Chapter 12 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    An agent for service of process may file a signed resignation with the Secretary of State, and the Secretary of State must notify the corporation; the agent’s authority then ends.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 12. Required Filings by Corporation or Its Agent [12570 - 12576] ( Chapter 12 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12571. (a) An agent designated for service of process pursuant to Section 12570 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 resigning 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 12570 replacing the agent for service of process that has resigned. (Amended by Stats. 2014, Ch. 834, Sec. 18. (SB 1041) Effective January 1, 2015.)
  92. 12572.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 12. Required Filings by Corporation or Its Agent [12570 - 12576] ( Chapter 12 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    If an agent for service of process dies, resigns, moves out of state, or otherwise stops serving, the corporation must promptly file a new agent designation.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 12. Required Filings by Corporation or Its Agent [12570 - 12576] ( Chapter 12 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12572. If a natural person who has been designated agent for service of process pursuant to Section 12570 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 12570. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  93. 12574.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 12. Required Filings by Corporation or Its Agent [12570 - 12576] ( Chapter 12 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    On request by an assessor, a corporation with locally assessed property must make a true copy of relevant business records available 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 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 12. Required Filings by Corporation or Its Agent [12570 - 12576] ( Chapter 12 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12574. 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. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  94. 12575.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 12. Required Filings by Corporation or Its Agent [12570 - 12576] ( Chapter 12 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    Certain corporate officers, directors, employees, or agents can be held jointly and severally liable for damages if they knowingly make, publish, or alter false corporate documents or records.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 12. Required Filings by Corporation or Its Agent [12570 - 12576] ( Chapter 12 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12575. 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 prospectus, report, circular, certificate, financial statement, balance sheet, public notice, or document respecting the corporation or its memberships, assets, liabilities, capital, dividends, distributions, patronage distributions, 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. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  95. 12576.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 12. Required Filings by Corporation or Its Agent [12570 - 12576] ( Chapter 12 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    The Attorney General may act on a complaint about a corporation's noncompliance and may seek court or agency relief if the response is unsatisfactory or no response is given within 30 days.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 12. Required Filings by Corporation or Its Agent [12570 - 12576] ( Chapter 12 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12576. 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 12460), Chapter 6 (commencing with Section 12480) or Chapter 13 (commencing with Section 12580) 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, general manager, or secretary, of the corporation, as set forth in the most recent statement filed pursuant to Section 12570) 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. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  96. 12580.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 13. Records, Reports and Rights of Inspection [12580 - 12608] ( Chapter 13 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. General Provisions [12580 - 12583] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    If a record that must be open to inspection 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. For this chapter, “written” includes certain electronic communication methods.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 13. Records, Reports and Rights of Inspection [12580 - 12608] ( Chapter 13 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. General Provisions [12580 - 12583] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12580. 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 purposes of this chapter, “written” or “in writing” includes cathode ray tube and similar electronic communications methods. (Amended by Stats. 1983, Ch. 792, Sec. 28.)
  97. 12581.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 13. Records, Reports and Rights of Inspection [12580 - 12608] ( Chapter 13 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. General Provisions [12580 - 12583] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

    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 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 13. Records, Reports and Rights of Inspection [12580 - 12608] ( Chapter 13 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. General Provisions [12580 - 12583] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12581. 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. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  98. 12582.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 13. Records, Reports and Rights of Inspection [12580 - 12608] ( Chapter 13 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. General Provisions [12580 - 12583] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    Any inspection right created by this chapter also applies to the records of each subsidiary of a corporation.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 13. Records, Reports and Rights of Inspection [12580 - 12608] ( Chapter 13 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. General Provisions [12580 - 12583] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12582. Any right of inspection created by this chapter extends to the records of each subsidiary of a corporation. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  99. 12583.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 13. Records, Reports and Rights of Inspection [12580 - 12608] ( Chapter 13 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. General Provisions [12580 - 12583] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    Contract, articles, and bylaws may not limit members’ rights provided in this chapter.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 13. Records, Reports and Rights of Inspection [12580 - 12608] ( Chapter 13 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 1. General Provisions [12580 - 12583] ( Article 1 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12583. The rights of members provided in this chapter may not be limited by contract or the articles or bylaws. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  100. 12600.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 13. Records, Reports and Rights of Inspection [12580 - 12608] ( Chapter 13 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Rights of Inspection [12600 - 12608] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    Members may inspect and copy certain member records, or obtain a member list, if they meet the stated demand and purpose requirements.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 13. Records, Reports and Rights of Inspection [12580 - 12608] ( Chapter 13 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Rights of Inspection [12600 - 12608] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12600. (a) Subject to Sections 12601 and 12602 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, a 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) A member or members possessing 5 percent or more of the voting power for a purpose reasonably related to the members’ interest as members. 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 12606 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. (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). (Repealed and added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  101. 12601.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 13. Records, Reports and Rights of Inspection [12580 - 12608] ( Chapter 13 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Rights of Inspection [12600 - 12608] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    The corporation may ask the superior court to block use of a membership list demand, and the court must follow set timelines and rules for protective orders, mandamus, and costs.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 13. Records, Reports and Rights of Inspection [12580 - 12608] ( Chapter 13 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Rights of Inspection [12600 - 12608] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12601. (a) Where the corporation, in good faith, and with a substantial basis, believes that the membership list, demanded by a member or members under Section 12600, 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) or provides a reasonable alternative pursuant to subdivision (c) of Section 12600 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 a demand by a member or members under Section 12600 or receipt of a written rejection by the member or members of an offer made pursuant to subdivision (c) of Section 12600 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 12600 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 party’s 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 alternate 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 Section 12600 and Section 12608. (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 a member or members under Section 12600, 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 a member or members possessing sufficient voting power, that the demand has been complied with, that the corporation, pursuant to subdivision (c) of Section 12600, 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 list is sought. 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 12600, 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. (Repealed and added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  102. 12602.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 13. Records, Reports and Rights of Inspection [12580 - 12608] ( Chapter 13 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Rights of Inspection [12600 - 12608] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    The superior court may limit or restrict Section 12600 inspection rights on petition, but only when necessary to protect a member’s constitutional rights; it may also issue a temporary order pausing related time limits.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 13. Records, Reports and Rights of Inspection [12580 - 12608] ( Chapter 13 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Rights of Inspection [12600 - 12608] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12602. (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 12600 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 12600 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 12600 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. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  103. 12603.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 13. Records, Reports and Rights of Inspection [12580 - 12608] ( Chapter 13 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Rights of Inspection [12600 - 12608] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    A cooperative corporation must let any member inspect specified books, records, and minutes when the member makes a written demand for a purpose reasonably related to the member’s interests.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 13. Records, Reports and Rights of Inspection [12580 - 12608] ( Chapter 13 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Rights of Inspection [12600 - 12608] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12603. 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. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  104. 12604.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 13. Records, Reports and Rights of Inspection [12580 - 12608] ( Chapter 13 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Rights of Inspection [12600 - 12608] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

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

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 13. Records, Reports and Rights of Inspection [12580 - 12608] ( Chapter 13 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Rights of Inspection [12600 - 12608] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12604. 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. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  105. 12605.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 13. Records, Reports and Rights of Inspection [12580 - 12608] ( Chapter 13 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Rights of Inspection [12600 - 12608] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    A demand-maker whose inspection purpose is frustrated by certain delays may ask the superior court to postpone a previously noticed members’ meeting.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 13. Records, Reports and Rights of Inspection [12580 - 12608] ( Chapter 13 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Rights of Inspection [12600 - 12608] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12605. Where the proper purpose of the person or persons making a demand pursuant to Section 12600 is frustrated by (a) any delay by the corporation in complying with a demand under Section 12600 beyond the time limits specified therein, or (b) any delay caused by the filing of a petition under Section 12601 or Section 12602, or (c) any delay caused by the alternative proposed under subdivision (c) of Section 12600, 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 12601 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. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  106. 12606.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 13. Records, Reports and Rights of Inspection [12580 - 12608] ( Chapter 13 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Rights of Inspection [12600 - 12608] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    If inspection is refused, the superior court may enforce the inspection right or appoint inspectors or accountants; corporate officers and agents must provide books and documents, and contempt may follow noncompliance.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 13. Records, Reports and Rights of Inspection [12580 - 12608] ( Chapter 13 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Rights of Inspection [12600 - 12608] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12606. (a) Upon refusal of a lawful demand for inspection under this chapter, or a lawful demand pursuant to Section 12600 or Section 12603, 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. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  107. 12607.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 13. Records, Reports and Rights of Inspection [12580 - 12608] ( Chapter 13 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Rights of Inspection [12600 - 12608] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    In an action or proceeding under this article, the court may award the member reasonable costs and expenses, including attorneys’ fees, if the corporation’s failure to comply with a proper demand was without justification, except as required by Section 12601.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 13. Records, Reports and Rights of Inspection [12580 - 12608] ( Chapter 13 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Rights of Inspection [12600 - 12608] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12607. In any action or proceeding under this article, and except as required by Section 12601, 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. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  108. 12608.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 13. Records, Reports and Rights of Inspection [12580 - 12608] ( Chapter 13 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Rights of Inspection [12600 - 12608] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    A membership list cannot be used or sold without board consent except in limited member-election solicitation circumstances.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 13. Records, Reports and Rights of Inspection [12580 - 12608] ( Chapter 13 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## ARTICLE 3. Rights of Inspection [12600 - 12608] ( Article 3 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12608. (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; or (2) Used for any purpose which the user does not reasonably and in good faith believe will benefit the corporation; or (3) Used for any commercial purpose or purpose in competition with the corporation; or (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 said 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 all the members’ names and addresses. (Amended by Stats. 1996, Ch. 589, Sec. 53. Effective January 1, 1997.)
  109. 12610.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 14. Service of Process [12610- 12610.] ( Chapter 14 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    Service of process on a corporation is governed by Chapter 17 of Division 1 of Title 1.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 14. Service of Process [12610- 12610.] ( Chapter 14 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12610. 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. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  110. 12620.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 15. Involuntary Dissolution [12620 - 12629] ( Chapter 15 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    Certain directors, members, and other authorized persons may file a complaint for involuntary dissolution in the superior court, and members or creditors may intervene before trial.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 15. Involuntary Dissolution [12620 - 12629] ( Chapter 15 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12620. (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. (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 persistent unfairness toward any member or the corporation’s property is being misapplied or wasted by its directors or officers. (6) The period for which the corporation was formed has terminated without extension of such period. (c) At any time prior to the trial of the action any member or creditor may intervene therein. (d) This section does not apply to any corporation subject to: (1) The Public Utilities Act (Part 1 (commencing with Section 201) of Division 1 of the Public Utilities Code) unless an order is obtained from the Public Utilities Commission authorizing the corporation either (a) to dispose of its assets as provided in Section 851 of the Public Utilities Code or (b) to dissolve. (2) The provisions of Article 14 (commencing with Section 1010) of Chapter 1 of Part 2 of Division 1 of the Insurance Code when the application authorized by Section 1011 of the Insurance Code has been filed by the Insurance Commissioner unless the consent of the Insurance Commissioner has been obtained. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  111. 12621.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 15. Involuntary Dissolution [12620 - 12629] ( Chapter 15 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    The Attorney General may sue to dissolve a corporation or purported corporation on listed 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 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 15. Involuntary Dissolution [12620 - 12629] ( Chapter 15 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12621. (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. (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. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  112. 12622.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 15. Involuntary Dissolution [12620 - 12629] ( Chapter 15 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    If a corporation’s board is deadlocked in a qualifying involuntary-dissolution complaint, the court may appoint a provisional director.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 15. Involuntary Dissolution [12620 - 12629] ( Chapter 15 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12622. 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 12620 the court may appoint a provisional director. The provisions of subdivision (d) of Section 12365 apply to any such provisional director so appointed. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  113. 12623.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 15. Involuntary Dissolution [12620 - 12629] ( Chapter 15 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    In an involuntary dissolution case, the court may appoint a receiver to manage the corporation and preserve its property if needed while the complaint is pending.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 15. Involuntary Dissolution [12620 - 12629] ( Chapter 15 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12623. 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 its members 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 (except that the Attorney General shall not be required to give security), 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. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  114. 12624.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 15. Involuntary Dissolution [12620 - 12629] ( Chapter 15 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    After a hearing, the court may order a corporation to be wound up and dissolved if cause is shown.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 15. Involuntary Dissolution [12620 - 12629] ( Chapter 15 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12624. 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. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  115. 12625.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 15. Involuntary Dissolution [12620 - 12629] ( Chapter 15 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    Once an involuntary winding-up proceeding starts, the board must conduct the winding up under court supervision, the corporation generally must stop doing business, and the directors must send written notice to members, known creditors, and claimants unless an exception applies.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 15. Involuntary Dissolution [12620 - 12629] ( Chapter 15 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12625. (a) Involuntary proceedings for winding up a corporation commence when the order for winding up is entered under Section 12624. (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. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  116. 12626.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 15. Involuntary Dissolution [12620 - 12629] ( Chapter 15 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    If an involuntary winding-up proceeding has started, the court has broad power over claims, accounts, directors, parties, and dissolution-related orders.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 15. Involuntary Dissolution [12620 - 12629] ( Chapter 15 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12626. 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 determination of the rights of members and of all classes of members in and to the assets of the corporation. (d) 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. (e) The appointment of a commissioner to hear and determine any or all matters, with such power or authority as the court may deem proper. (f) The filing of any vacancies on the board which the directors or the members are unable to fill. (g) 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. (h) 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. (i) The determination of whether adequate provision has been made for payment or satisfaction of all debts and liabilities not actually paid. (j) The making of orders for the withdrawal or termination of proceedings, to wind up and dissolve, subject to conditions for the protection of members and creditors. (k) 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. (l) The making of orders for the bringing in of new parties as the court deems proper for the determination of all questions and matters. (m) The disposition of assets held in charitable trust. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  117. 12627.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 15. Involuntary Dissolution [12620 - 12629] ( Chapter 15 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    Creditors and claimants can be barred from sharing in a general asset distribution if they do not file claims and proofs by the court-set deadline.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 15. Involuntary Dissolution [12620 - 12629] ( Chapter 15 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12627. (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. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  118. 12628.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 15. Involuntary Dissolution [12620 - 12629] ( Chapter 15 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    A court may declare a cooperative corporation wound up and dissolved once the directors’ 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 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 15. Involuntary Dissolution [12620 - 12629] ( Chapter 15 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12628. (a) Upon the final settlement of the accounts of the directors or other persons appointed pursuant to Section 12625 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) The court may make such additional orders and grant such further relief as it deems proper upon the evidence submitted. (c) 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 in respect to completion of the winding up. (Amended by Stats. 2006, Ch. 773, Sec. 33. Effective September 29, 2006.)
  119. 12629.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 15. Involuntary Dissolution [12620 - 12629] ( Chapter 15 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    When a corporation is dissolved or forfeits its existence by a court order, decree, or judgment, a certified copy 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 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 15. Involuntary Dissolution [12620 - 12629] ( Chapter 15 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12629. 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. 34. Effective September 29, 2006.)
  120. 12630.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 16. Voluntary Dissolution [12630 - 12638] ( Chapter 16 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    A corporation may voluntarily wind up and dissolve, but only through the approval steps listed in this section.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 16. Voluntary Dissolution [12630 - 12638] ( Chapter 16 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12630. (a) Any corporation may elect voluntarily to wind up and dissolve (1) by approval of a majority of all members (Section 12223) or (2) by approval of the board and approval of the members (Section 12224). (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. (c) If a corporation comes within one of the descriptions in subdivision (b) and if the number of directors then in office is less than a quorum, it 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 12351. (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 12650) 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. 49. (AB 1233) Effective January 1, 2010.)
  121. 12631.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 16. Voluntary Dissolution [12630 - 12638] ( Chapter 16 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    A corporation that has elected to wind up and dissolve must promptly file a certificate for that election, and the certificate must include specified statements about the election and who authorized it.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 16. Voluntary Dissolution [12630 - 12638] ( Chapter 16 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12631. (a) Whenever a corporation has elected to wind up and dissolve a certificate evidencing that election shall forthwith be filed. (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 12223) 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 persons holding at least a majority of the voting power. (3) If the certificate is executed by a member or members, that the subscribing person or persons were authorized to execute the certificate by persons representing at least a majority of the voting power. (4) If the election was made by the board pursuant to subdivision (b) of Section 12630, the certificate shall also set forth 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 12630 is made by the vote of all the members of a corporation with members or by a vote of all members of the board of a corporation without members pursuant to subdivision (b) of Section 12630 and a statement to that effect is added to the certificate of dissolution pursuant to Section 12635, the separate filing of the certificate of election pursuant to this section is not required. (Amended by Stats. 2014, Ch. 834, Sec. 19. (SB 1041) Effective January 1, 2015.)
  122. 12632.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 16. Voluntary Dissolution [12630 - 12638] ( Chapter 16 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    A corporation may revoke a voluntary election to wind up and dissolve before any assets are distributed, but the required approvals depend on how the election was originally made.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 16. Voluntary Dissolution [12630 - 12638] ( Chapter 16 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12632. (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 12630, by the approval of a majority of all members; (2) if the election was made pursuant to paragraph (2) of subdivision (a) of Section 12630, by approval of the board and approval of the members; or (3) if the election was by the board pursuant to subdivision (b) of Section 12630, by approval of the board. Thereupon a certificate evidencing the revocation shall be signed, verified and filed in the manner prescribed by Section 12631. (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 persons representing at least a majority of the voting power. (4) If the revocation was made by the approval of the board and the approval of the members, the certificate shall so state. (5) If the revocation was made by the board alone, the certificate shall so state. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  123. 12633.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 16. Voluntary Dissolution [12630 - 12638] ( Chapter 16 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    Once voluntary winding up starts, the board keeps acting and may wind up the corporation’s affairs, while the corporation generally must stop operating except as needed for winding up or preserving value.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 16. Voluntary Dissolution [12630 - 12638] ( Chapter 16 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12633. (a) Voluntary proceedings for winding up the corporation commence upon the adoption of the resolution required by Section 12630 by the members or by the board, 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. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  124. 12634.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 16. Voluntary Dissolution [12630 - 12638] ( Chapter 16 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    If a corporation is voluntarily winding up, the superior court may take jurisdiction on petition by the corporation, qualifying members, or certain creditors, and may issue orders to protect those involved.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 16. Voluntary Dissolution [12630 - 12638] ( Chapter 16 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12634. 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) a member or members possessing 5 percent or more of the voting power, or (c) 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. 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 members and creditors as justice and equity may require. The provisions of Chapter 15 (commencing with Section 12620) (except Sections 12620 and 12621) shall apply to such court proceedings. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  125. 12635.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 16. Voluntary Dissolution [12630 - 12638] ( Chapter 16 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    After a corporation has been completely wound up without court proceedings, a majority of the directors then in office must sign and verify a certificate of dissolution, and the certificate must be filed.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 16. Voluntary Dissolution [12630 - 12638] ( Chapter 16 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12635. (a) When a corporation has been completely wound up without court proceedings therefor, 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 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. (3) That its known assets have been distributed to the persons entitled thereto or that it acquired no known assets, as the case may be. (4) That the corporation is dissolved. (5) That a final franchise tax return, as described by Section 23332 of the Revenue and Taxation Code, has been or will be filed with the Franchise Tax Board, as required under Part 10.2 (commencing with Section 18401) of Division 2 of the Revenue and Taxation Code. (b) The certificate of dissolution shall be filed and thereupon the corporate existence shall cease, 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. 2006, Ch. 773, Sec. 35. Effective September 29, 2006.)
  126. 12636.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 16. Voluntary Dissolution [12630 - 12638] ( Chapter 16 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    If a corporation’s term expires without renewal or extension, the board must stop its activities and wind up the corporation’s affairs, unless another law says otherwise.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 16. Voluntary Dissolution [12630 - 12638] ( Chapter 16 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12636. 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 12635. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  127. 12637.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 16. Voluntary Dissolution [12630 - 12638] ( Chapter 16 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    The board may ask the superior court for an order dissolving the corporation instead of filing a certificate of dissolution; the court must notify interested persons, and interested members, creditors, or others may appear and contest within 30 days after publication.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 16. Voluntary Dissolution [12630 - 12638] ( Chapter 16 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12637. (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 interested persons 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 12627. (c) Any person claiming to be interested as member, 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 12628 and 12629. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  128. 12638.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 16. Voluntary Dissolution [12630 - 12638] ( Chapter 16 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    A corporation winding up may handle known claims by this procedure, but its notice must set a claim deadline of at least 120 days, and late claims or untimely challenges can be barred.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 16. Voluntary Dissolution [12630 - 12638] ( Chapter 16 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12638. (a) A corporation in the process of 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 12633 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 shall 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 renumbering Section 12637 (as added by Stats. 1996, Ch. 589, Sec. 54) by Stats. 2015, Ch. 303, Sec. 46. (AB 731) Effective January 1, 2016.)
  129. 12650.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 17. General Provisions Relating to Dissolution [12650 - 12663] ( Chapter 17 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    After a dissolution proceeding starts, directors, court-appointed persons, and officers may take winding-up actions for the corporation.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 17. General Provisions Relating to Dissolution [12650 - 12663] ( Chapter 17 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12650. The powers and duties of the directors (or other persons appointed by the court pursuant to Section 12625) 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) 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 12521, 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. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  130. 12651.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 17. General Provisions Relating to Dissolution [12650 - 12663] ( Chapter 17 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    A board vacancy may be filled during a winding up proceeding as provided in Section 12364.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 17. General Provisions Relating to Dissolution [12650 - 12663] ( Chapter 17 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12651. A vacancy on the board may be filled during a winding up proceeding in the manner provided in Section 12364. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  131. 12652.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 17. General Provisions Relating to Dissolution [12650 - 12663] ( Chapter 17 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    An interested person may ask the superior court to resolve who the directors are, and the court may appoint directors to wind up the corporation if there are no directors.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 17. General Provisions Relating to Dissolution [12650 - 12663] ( Chapter 17 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12652. 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 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. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  132. 12653.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 17. General Provisions Relating to Dissolution [12650 - 12663] ( Chapter 17 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    The board must distribute a winding-up corporation’s remaining assets after known debts and liabilities are paid or provided for, unless court-supervised timing rules or the special asset rule apply.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 17. General Provisions Relating to Dissolution [12650 - 12663] ( Chapter 17 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12653. (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 12655, 12656, and 12656.5. (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, that are not subject to attachment, execution, or sale for the corporation’s debts and liabilities may be distributed pursuant to Sections 12655, 12656, and 12656.5 even though all debts and liabilities have not been paid or adequately provided for. (Amended by Stats. 2015, Ch. 192, Sec. 24. (AB 816) Effective January 1, 2016.)
  133. 12654.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 17. General Provisions Relating to Dissolution [12650 - 12663] ( Chapter 17 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    A debt or liability is treated as adequately provided for if it is assumed or guaranteed in good faith by financially responsible persons or the U.S. government, or if the amount is deposited under Section 12659.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 17. General Provisions Relating to Dissolution [12650 - 12663] ( Chapter 17 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12654. 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 12659. This section does not prescribe the exclusive means of making adequate provision for debts and liabilities. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  134. 12655.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 17. General Provisions Relating to Dissolution [12650 - 12663] ( Chapter 17 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    A corporation must return, transfer, or convey assets held under a valid condition when that condition has occurred or will occur, after complying with Section 12653.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 17. General Provisions Relating to Dissolution [12650 - 12663] ( Chapter 17 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12655. After complying with the provisions of Section 12653 assets held by a corporation upon a valid condition requiring return, transfer, or conveyance, which condition has occurred or will occur, shall be returned, transferred, or conveyed in accordance with the condition. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  135. 12656.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 17. General Provisions Relating to Dissolution [12650 - 12663] ( Chapter 17 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    On dissolution, a corporation must dispose of its assets as the articles or bylaws say, or otherwise distribute them among members according to their rights.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 17. General Provisions Relating to Dissolution [12650 - 12663] ( Chapter 17 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12656. After complying with the provisions of Section 12653 and except as otherwise provided in Section 12655, assets held by a corporation shall be disposed of on dissolution as follows: (a) If the articles or bylaws provide the manner of disposition, the assets shall be disposed of in that manner. (b) If the articles or bylaws do not provide the manner of disposition, the assets shall be distributed among the members in accordance with their respective rights therein. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  136. 12656.5.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 17. General Provisions Relating to Dissolution [12650 - 12663] ( Chapter 17 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    On dissolution, a worker cooperative must distribute most of its unallocated capital account to members under the cooperative’s chosen basis, and any indivisible reserve account amount must go to a designated cooperative development organization.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 17. General Provisions Relating to Dissolution [12650 - 12663] ( Chapter 17 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12656.5. (a) After complying with the provisions of Section 12653, and except as otherwise provided in Section 12655, upon dissolution of a worker cooperative the majority of the unallocated capital account shall be distributed to members on the basis of any of the following, as specified in the articles of incorporation or bylaws of the cooperative: (1) Patronage. (2) Capital contributions. (3) A combination of patronage and capital contributions. (b) A worker cooperative is authorized to include patronage provided by past and current members in its distribution of the unallocated capital account. (c) Subdivision (a) shall not apply to any amounts in the indivisible reserve account. Any amount in the indivisible reserve account shall, upon dissolution, be allocated to a cooperative development organization designated in the articles of incorporation or the bylaws. (Added by Stats. 2015, Ch. 192, Sec. 25. (AB 816) Effective January 1, 2016.)
  137. 12657.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 17. General Provisions Relating to Dissolution [12650 - 12663] ( Chapter 17 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    Distribution in liquidation may be made in money, property, or securities, and either in installments or all at once, if it is fair, ratable, and consistent with the articles and bylaws.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 17. General Provisions Relating to Dissolution [12650 - 12663] ( Chapter 17 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12657. 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 assets. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  138. 12658.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 17. General Provisions Relating to Dissolution [12650 - 12663] ( Chapter 17 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    When a winding-up corporation has multiple membership classes, a distribution plan that departs from liquidation rights may still be adopted if approved by the board and each class of members; after adoption, the board must mail notice within 20 days to holders with a liquidation preference.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 17. General Provisions Relating to Dissolution [12650 - 12663] ( Chapter 17 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12658. (a) If a corporation in process of winding up has more than one class of memberships outstanding, a plan of distribution of the memberships, obligations, or securities of any other corporation, domestic or foreign, or assets other than money which is not in accordance with the liquidation rights of any class or classes as specified in the articles or bylaws may nevertheless be adopted if approved by (1) the board and (2) by approval by the members (Section 12224) of each class. The plan may provide that such distribution is in complete or partial satisfaction of the rights of any of such members upon distribution and liquidation of the assets. (b) A plan of distribution so approved shall be binding upon all the members. The board shall cause notice of the adoption of the plan to be given by mail within 20 days after its adoption to all holders of memberships having a liquidation preference. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  139. 12659.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 17. General Provisions Relating to Dissolution [12650 - 12663] ( Chapter 17 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    A corporation may deposit certain disputed or unclaimed payments, distributions, or claim amounts with the Controller, and the depositary must later pay them to the lawful owners on proof of title.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 17. General Provisions Relating to Dissolution [12650 - 12663] ( Chapter 17 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12659. (a) If any members, 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, member, or other person is contingent, contested, or not determined, or if the ownership of any memberships is in dispute, 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. 4. Effective January 1, 1997.)
  140. 12660.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 17. General Provisions Relating to Dissolution [12650 - 12663] ( Chapter 17 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    If a corporation in winding up distributes assets before its debts are paid or provided for, the improper distribution can be recovered, and creditors may sue to enforce that liability.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 17. General Provisions Relating to Dissolution [12650 - 12663] ( Chapter 17 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12660. (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 any one or more creditors of the corporation, whether or not they have reduced their claims to judgment. (c) Members who satisfy any liability under this section shall have the right of ratable contribution from other distributees similarly liable. Any member who has been compelled to return to the corporation more than the member’s ratable share of the amount needed to pay the debts and liabilities of the corporation may require that the corporation recover from any or all of the other distributees such proportion of the amounts received by them upon the improper distribution as to give contribution to those held liable under this section and make the distribution of the assets fair and ratable, according to the respective rights and preferences of the memberships, after payment or adequate provision for payment of all the debts and liabilities of the corporation. (d) As used in this section, “process of winding up” includes proceedings under Chapters 15 (commencing with Section 12630) and 16 (commencing with Section 12630) and also any other distribution of assets to persons made in contemplation of termination or abandonment of the corporate business. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  141. 12661.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 17. General Provisions Relating to Dissolution [12650 - 12663] ( Chapter 17 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    A dissolved corporation continues only for winding up and related matters, not for carrying on its business.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 17. General Provisions Relating to Dissolution [12650 - 12663] ( Chapter 17 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12661. (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. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  142. 12662.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 17. General Provisions Relating to Dissolution [12650 - 12663] ( Chapter 17 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    Claims against a dissolved corporation may be enforced against the dissolved corporation’s undistributed assets or against persons who received distributed assets, but only up to the stated limits and time rules.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 17. General Provisions Relating to Dissolution [12650 - 12663] ( Chapter 17 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12662. (a) (1) Causes of action against a dissolved corporation, whether arising before or after the dissolution of the corporation, may be enforced against any of the following: (A) Against the dissolved corporation, to the extent of its undistributed assets; including, without limitation, any insurance assets held by the corporation that may be available to satisfy claims. (B) If any of the assets of the dissolved corporation have been distributed to other persons, against those persons to the extent of their pro rata share of the claim or to the extent of the corporate assets distributed to them upon dissolution of the corporation, whichever is less. The total liability of a person under this section may not exceed the total amount of assets of the dissolved corporation distributed to that person upon dissolution of the corporation. (2) Except as set forth in subdivision (c), all causes of action against a person to whom assets were distributed arising under this section are extinguished unless the claimant commences a proceeding to enforce the cause of action against that person prior to the earlier of the following: (A) The expiration of the statute of limitations applicable to the cause of action. (B) Four years after the effective date of the dissolution of the corporation. (3) As a matter of procedure only, and not for purposes of determining liability, persons to whom assets of a dissolved corporation are distributed may be sued in the name of the corporation upon any cause of action against the corporation. This section does not affect the rights of the corporation or its creditors under Section 2009, or the rights, if any, of creditors under the Uniform Voidable Transactions Act, which may arise against persons to whom those assets are distributed. This subdivision applies to corporations dissolved on or after January 1, 2000. Corporations dissolved prior to that date are subject to the law in effect prior to that date. (b) Summons or other process against a dissolved corporation may be served by delivering a copy thereof to an officer, director, or person having charge of its assets or, if that person cannot be found, to any agent upon whom process might be served at the time of dissolution. If none of these 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. (c) Every dissolved corporation shall survive and continue to exist indefinitely for the purpose of being sued in any quiet title action. Any judgment rendered in any quiet title action shall bind each and all of its members or other persons having any equity or other interest in that corporation, to the extent of their interest therein, and that 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 quiet title 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 that process and the fee therefor, the Secretary of State forthwith shall give notice to the corporation as provided in Section 1702. (Amended by Stats. 2019, Ch. 143, Sec. 33. (SB 251) Effective January 1, 2020.)
  143. 12663.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 17. General Provisions Relating to Dissolution [12650 - 12663] ( Chapter 17 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    An owners’ association, or anyone acting for it, may not transfer all or substantially all assets or file a certificate of dissolution; a court also may not order the association wound up and dissolved, unless the stated member-approval and occupancy conditions are satisfied.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 17. General Provisions Relating to Dissolution [12650 - 12663] ( Chapter 17 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12663. Without the approval of 100 percent of the members, any contrary provision in this part or the articles or bylaws notwithstanding, so long as there is any lot, parcel, area, apartment or unit for which 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, is obligated to provide management, maintenance, preservation, or control, the following shall apply: (a) The owners’ association or any person acting on its behalf shall not do either of the following: (1) Transfer all or substantially all of its assets. (2) File a certificate of dissolution. (b) No court shall enter an order declaring the owners’ association duly wound up and dissolved. (Amended by Stats. 2006, Ch. 538, Sec. 81. Effective January 1, 2007.)
  144. 12670.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 18. Crimes and Penalties [12670 - 12679] ( Chapter 18 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    If a corporation fails to file the required statement, the Secretary of State must notify it, and if the filing is still missing after 60 days, certify the corporation to the Franchise Tax Board, which must assess a $50 penalty unless an exception applies.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 18. Crimes and Penalties [12670 - 12679] ( Chapter 18 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12670. (a) Upon the failure of a corporation to file the statement required by Section 12570, 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 shall 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 notice of the delinquency, a statement pursuant to Section 12570 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 which on or prior to the date of certification pursuant to subdivision (a) has dissolved, has been 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 12570. The Secretary of State need not provide notice of the filing requirement pursuant to Section 12570, 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 12570 is excusable because of reasonable cause or unusual circumstances which 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. 20. (SB 1041) Effective January 1, 2015.)
  145. 12671.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 18. Crimes and Penalties [12670 - 12679] ( Chapter 18 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    Promoters, directors, or officers of a corporation who knowingly and willfully issue or consent to issuing memberships or membership certificates to defraud members or creditors commit a misdemeanor.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 18. Crimes and Penalties [12670 - 12679] ( Chapter 18 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12671. Any promoter, director, or officer of a corporation who knowingly and willfully issues or consents to the issuance of memberships or membership certificates with intent to defraud present or future members or creditors is guilty of a misdemeanor punishable by a fine of not more than one thousand dollars ($1,000) or by imprisonment in county jail for not more than one year or by both such fine and imprisonment. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  146. 12672.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 18. Crimes and Penalties [12670 - 12679] ( Chapter 18 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    A corporate director who knowingly and fraudulently helps approve an improper distribution of assets, outside what this part allows, commits a crime.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 18. Crimes and Penalties [12670 - 12679] ( Chapter 18 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12672. 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 of assets, except in the case and in the manner allowed by this part, either with the design of defrauding creditors or members or of giving a false appearance to the value of the membership and thereby defrauding purchasers 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 by both that fine and imprisonment. (Amended by Stats. 2011, Ch. 15, Sec. 44. (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.)
  147. 12673.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 18. Crimes and Penalties [12670 - 12679] ( Chapter 18 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    Directors or officers of a corporation commit a crime if they knowingly help publish false or exaggerated corporate reports, or if they refuse required book entries or notices.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 18. Crimes and Penalties [12670 - 12679] ( Chapter 18 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12673. (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, prospectus, account, or statement of operations, financial condition, or prospects, or (3) any other paper intended to give, and having a tendency to give, a membership in such corporation a greater or lesser value than it really possesses. (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. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  148. 12674.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 18. Crimes and Penalties [12670 - 12679] ( Chapter 18 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    This section makes certain acts by corporate directors, officers, agents, and members crimes, including fraudulent misappropriation-related record omissions and fraudulent destruction or falsification of corporate records.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 18. Crimes and Penalties [12670 - 12679] ( Chapter 18 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12674. (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 both such fine and imprisonment. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  149. 12675.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 18. Crimes and Penalties [12670 - 12679] ( Chapter 18 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    A corporation’s director, officer, agent, or organizer must not knowingly show false, forged, or altered documents to an authorized public officer or board to deceive them.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 18. Crimes and Penalties [12670 - 12679] ( Chapter 18 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12675. 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 exceeding one year. (Amended by Stats. 2011, Ch. 15, Sec. 45. (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.)
  150. 12676.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 18. Crimes and Penalties [12670 - 12679] ( Chapter 18 added by Stats. 1982, Ch. 1625, Sec. 3. )

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    A person must not, without authorization, use another person's name in a corporation prospectus, circular, advertisement, or announcement to make it seem that person is an officer, agent, or promoter. Violations are misdemeanors.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 18. Crimes and Penalties [12670 - 12679] ( Chapter 18 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12676. Every person who, without being authorized so to do, subscribes the name of another to or inserts the name of another in any prospectus, circular or other advertisement or announcement of any corporation, whether existing or intended to be formed, with intent to permit the document to be published and thereby to lead persons to believe that the person whose name is so subscribed is an officer, agent or promoter of such corporation, when in fact no such relationship exists to the knowledge of such person, is guilty of a misdemeanor. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  151. 12677.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 18. Crimes and Penalties [12670 - 12679] ( Chapter 18 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    This section says the chapter does not limit 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 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 18. Crimes and Penalties [12670 - 12679] ( Chapter 18 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12677. 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. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  152. 12678.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 18. Crimes and Penalties [12670 - 12679] ( Chapter 18 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    A person may be enjoined for violating Section 12311, and a corporation may be enjoined for doing business outside the purpose for which it was formed.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 18. Crimes and Penalties [12670 - 12679] ( Chapter 18 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12678. Any person may be enjoined from violating the provisions of Section 12311. Any corporation may be enjoined from carrying on business outside of the purpose for which it was formed. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  153. 12679.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 18. Crimes and Penalties [12670 - 12679] ( Chapter 18 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    A person who violates Section 12311, or a corporation that carries on business outside the purpose for which it was formed, commits a misdemeanor punishable by up to a $500 fine, up to one year in jail, or both.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 18. Crimes and Penalties [12670 - 12679] ( Chapter 18 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12679. Any person violating Section 12311, and any corporation carrying on business outside the purpose for which it was formed, is guilty of a misdemeanor punishable by a fine of five hundred dollars ($500), or by imprisonment for not more than one year, or by both such fine and imprisonment. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  154. 12680.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 19. Foreign Corporations [12680- 12680.] ( Chapter 19 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    Foreign corporations doing intrastate business must comply with Chapter 21 of Division 1, with stated part-specific exceptions, and Section 2115 does not apply.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 19. Foreign Corporations [12680- 12680.] ( Chapter 19 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12680. 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. 10. Effective January 1, 1998.)
  155. 12690.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 20. Transition Provisions [12690 - 12704] ( Chapter 20 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    This section defines “new law,” “prior law,” and “subject corporation” for Sections 12690 to 12704.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 20. Transition Provisions [12690 - 12704] ( Chapter 20 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12690. As used in Sections 12690 to 12704, inclusive, of this part: (a) “New law” means Part 2 (commencing with Section 12200) of Division 3 of Title 1 of the Corporations Code enacted by the California Legislature during the 1981–82 Regular Session and operative January 1, 1984. (b) “Prior law” means Part 2 (commencing with Section 12220) of Division 3 of Title 1 of the Corporations Code in effect on December 31, 1983. (c) “Subject corporation” means any corporation described in subdivision (a) of Section 12202 and subject to the prior law. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  156. 12691.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 20. Transition Provisions [12690 - 12704] ( Chapter 20 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    This section says when the new law applies to cooperative corporations and related acts, using January 1, 1984 as the key cutoff date.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 20. Transition Provisions [12690 - 12704] ( Chapter 20 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12691. (a) The new law shall apply to all corporations which are incorporated on or after January 1, 1984, under Part 2 (commencing with Section 12200) of this division or which are expressly governed by Part 2 pursuant to a particular provision of this division or other specific statutory provision. (b) Except as otherwise expressly provided in this chapter, the new law shall apply to all subject corporations and to all actions taken by the directors, officers, or members of such corporations, on or after January 1, 1984. (c) Except as otherwise expressly provided in this chapter, all of the sections of the new law governing acts, contracts, or other transactions by a subject corporation or its directors, officers, or members, shall apply only to the acts, contracts, or transactions occurring on or after January 1, 1984, and the prior law shall govern acts, contracts, or transactions occurring before January 1, 1984. (d) Except as otherwise expressly provided in this chapter, any vote or consent by the directors or members of a subject corporation prior to January 1, 1984, in accordance with the prior law, shall be effective in accordance with that law. If any certificate or document is required to be filed in any public office of this state relating to such vote or consent, it may be filed on or after January 1, 1984, in accordance with the prior law. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  157. 12692.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 20. Transition Provisions [12690 - 12704] ( Chapter 20 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    This section limits when certain new-law articles provisions apply to subject corporations and sets rules for adopting an amendment to elect those provisions.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 20. Transition Provisions [12690 - 12704] ( Chapter 20 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12692. (a) The provisions of Sections 12310 and 12313 of the new law relating to the contents of articles of incorporation do not apply to subject corporations unless and until an amendment of the articles is filed stating that the corporation elects to be governed by all of the provisions of the new law not otherwise applicable to it under this chapter. (b) The amendment described in subdivision (a) may be adopted by the board alone, except that if such amendment makes any change in the articles other than conforming the statement of purposes of the subject corporation to Section 12310, deleting any references to the location of its principal office, deleting any statement of par value or any statement regarding the number of directors, or conforming any such statement to Section 12331 (subject to Section 12694), the amendment shall also be approved by the members (Section 12224) if such approval is otherwise required for the changes made. (c) The amendment shall not name the corporation’s initial agent for service of process if a report required by Section 12570 has been filed. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  158. 12693.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 20. Transition Provisions [12690 - 12704] ( Chapter 20 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    This transition rule says Section 12320 applies to subject corporations, and earlier article statements about corporate powers are not treated as limits unless they say so expressly.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 20. Transition Provisions [12690 - 12704] ( Chapter 20 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12693. Section 12320 of the new law shall apply to subject corporations, but any statement in the articles of these corporations prior to an amendment thereof pursuant to Section 12692, relating to the powers of the corporation, shall not be construed as a limitation unless it is expressly stated as such. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  159. 12694.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 20. Transition Provisions [12690 - 12704] ( Chapter 20 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    This section says subdivision (a) of Section 12353 applies to subject corporations, and their treasurer is treated as the chief financial officer unless the articles or bylaws say otherwise.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 20. Transition Provisions [12690 - 12704] ( Chapter 20 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12694. Subdivision (a) of Section 12353 of the new law shall apply to subject corporations, but the treasurer of these corporations shall be deemed to be the chief financial officer unless otherwise provided in the articles or bylaws. (Amended by Stats. 2009, Ch. 631, Sec. 50. (AB 1233) Effective January 1, 2010.)
  160. 12695.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 20. Transition Provisions [12690 - 12704] ( Chapter 20 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    For subject corporations, Section 12377 controls proposed indemnification after January 1, 1984, including when the underlying events happened before that date.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 20. Transition Provisions [12690 - 12704] ( Chapter 20 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12695. Section 12377 governs any proposed indemnification by a subject corporation after January 1, 1984, whether the events upon which the indemnification is based occurred before or after January 1, 1984. Any statement relating to indemnification contained in the articles or bylaws of a subject corporation shall not be construed as limiting the indemnification permitted by Section 12377, unless it is expressly stated as so intended. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  161. 12696.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 20. Transition Provisions [12690 - 12704] ( Chapter 20 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    This section says the new law’s Chapters 5 and 6 apply to certain member meetings, written ballots, and votes on or after January 1, 1984, but prior law still applies to meetings initially called before that date if notice was given to voting members.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 20. Transition Provisions [12690 - 12704] ( Chapter 20 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12696. (a) The provisions of Chapter 5 (commencing with Section 12460) and Chapter 6 (commencing with Section 12480) of the new law shall apply to any meeting of members of a subject corporation, held on or after January 1, 1984, and to any action by such members pursuant to a written ballot, which becomes effective on or after January 1, 1984, and to any vote cast at such a meeting or ballot, given for such action, whether or not a ballot was executed by the member prior to January 1, 1984. (b) Notwithstanding subdivision (a), the prior law shall apply to any meeting of members and to any vote cast at such a meeting if the meeting was initially called for a date prior to January 1, 1984, and notice thereof was given to members entitled to vote at the meeting. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  162. 12697.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 20. Transition Provisions [12690 - 12704] ( Chapter 20 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    This section says the new law applies to actions started on or after January 1, 1984, for a subject corporation, while the prior law controls actions started before that date that were still pending then.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 20. Transition Provisions [12690 - 12704] ( Chapter 20 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12697. Section 12490 of the new law shall apply to actions commenced on or after January 1, 1984, with respect to a subject corporation. The prior law shall govern actions which are commenced prior to January 1, 1984, but are still pending on January 1, 1984. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  163. 12698.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 20. Transition Provisions [12690 - 12704] ( Chapter 20 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    This section says Chapters 9 and 10 of the new law apply to certain transactions by a subject corporation on or after January 1, 1984, unless one of the stated prior-law approval exceptions applies.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 20. Transition Provisions [12690 - 12704] ( Chapter 20 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12698. Chapter 9 (commencing with Section 12520) and Chapter 10 (commencing with Section 12530) of the new law shall apply to transactions consummated by a subject corporation on or after January 1, 1984, unless the approval required by the prior law has been given prior to January 1, 1984, or has been given on or after January 1, 1984, at a meeting of members initially called for a date prior to January 1, 1984, in which case the transaction shall be governed by the prior law. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  164. 12699.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 20. Transition Provisions [12690 - 12704] ( Chapter 20 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    For involuntary dissolution actions of a subject corporation, the new law applies if the action starts on or after January 1, 1984; older pending actions are governed by prior law.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 20. Transition Provisions [12690 - 12704] ( Chapter 20 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12699. Chapter 15 (commencing with Section 12620) and Chapter 17 (commencing with Section 12650) of the new law shall apply to acts for involuntary dissolution of a subject corporation commenced on or after January 1, 1984. The prior law shall govern any of these actions which are commenced prior to January 1, 1984, but are still pending on January 1, 1984. (Added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  165. 12700.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 20. Transition Provisions [12690 - 12704] ( Chapter 20 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    For voluntary dissolution proceedings, the new law applies if the election to wind up and dissolve is filed on or after January 1, 1984; earlier-initiated proceedings are governed by the prior law.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 20. Transition Provisions [12690 - 12704] ( Chapter 20 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12700. Chapter 16 (commencing with Section 12630) and Chapter 17 (commencing with Section 12650) of the new law shall apply to any voluntary dissolution proceeding initiated with respect to a subject corporation by the filing on or after January 1, 1984, of an election to wind up and dissolve. The prior law shall govern any of these proceedings so initiated prior to January 1, 1984. (Repealed and added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  166. 12701.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 20. Transition Provisions [12690 - 12704] ( Chapter 20 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    If a corporate agent was designated for service of process before January 1, 1984, service may be made at any office listed in the agent’s filed certificate.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 20. Transition Provisions [12690 - 12704] ( Chapter 20 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12701. When any corporate agent has been designated for service of process prior to January 1, 1984, and such designation of an agent included a name of a city, town, or village where the corporate agent maintained an office, service on such an agent may be effected at any office of the agent set forth in the certificate of the corporate agent filed pursuant to Section 1505, 6213, 8213, or 12573, or filed pursuant to Section 3301.5, 3301.6, 6403.5, or 6403.6 as in effect prior to January 1, 1977. (Repealed and added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  167. 12702.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 20. Transition Provisions [12690 - 12704] ( Chapter 20 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    Eligible subject corporations may choose to continue under this code, and certain certificates must be filed with the Secretary of State.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 20. Transition Provisions [12690 - 12704] ( Chapter 20 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12702. Any subject corporation that existed on the first day of January 1873, was formed under the laws of this state, and which has not already elected to continue its existence under the prior law, may at any time elect to continue its existence under the provisions of this code applicable thereto, (a) by the unanimous vote of all its directors, (b) by the vote of the members representing a majority of the voting power of the corporation at an election held at any annual meeting of the members or at any meeting called by the directors for the express purpose of considering this subject, or (c) by action of the directors upon the written consent of the members representing a majority of the voting power of the corporation. A certificate of the action of the directors, signed by the directors and the secretary, shall be filed in the office of the Secretary of State when the election is made by the unanimous vote of the directors or upon the written consent of the members. A certificate of the proceedings of the meeting of the members when the election is made at any such meeting, signed by the chairperson and secretary of the meeting and a majority of the directors, shall be filed in the office of the Secretary of State. Thereafter, the corporation shall continue its existence under the provisions of this code which are applicable thereto, and shall possess all the rights and powers, and shall be subject to all the obligations, restrictions, and limitations, prescribed thereby. (Amended by Stats. 2022, Ch. 617, Sec. 85. (SB 1202) Effective January 1, 2023.)
  168. 12704.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 20. Transition Provisions [12690 - 12704] ( Chapter 20 added by Stats. 1982, Ch. 1625, Sec. 3. )

    Verify source ↗

    If a subject corporation’s rights, privileges, and powers were already suspended before January 1, 1984, the prior-law sections keep applying until the controller restores them.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 2. COOPERATIVE CORPORATIONS [12200 - 12704] ( Heading of Part 2 amended by Stats. 2015, Ch. 192, Sec. 2. ) ## CHAPTER 20. Transition Provisions [12690 - 12704] ( Chapter 20 added by Stats. 1982, Ch. 1625, Sec. 3. ) ## 12704. If the corporate rights, privileges, and powers of a subject corporation have been suspended and are still suspended immediately prior to January 1, 1984 pursuant to the prior law, as a result of its incorporation of the General Nonprofit Corporation Law (commencing with Section 9000) in effect on December 31, 1979, and the incorporation by the General Nonprofit Corporation Law of Sections 5700 through 5908 of the prior law (Section 2300), such sections and provisions continue to apply to such corporation until restoration by the controller pursuant to such sections. (Repealed and added by Stats. 1982, Ch. 1625, Sec. 3. Operative January 1, 1984.)
  169. 13.

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

    Verify source ↗

    For this code, singular terms include the plural, and plural terms include the singular.

    ## Corporations Code - CORP ## GENERAL PROVISIONS ( General Provisions enacted by Stats. 1947, Ch. 1038. ) ## 13. The singular number includes the plural, and the plural number includes the singular. (Enacted by Stats. 1947, Ch. 1038.)
  170. 1300.

    ## 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 13. Dissenters’ Rights [1300 - 1313] ( Chapter 13 added by Stats. 1975, Ch. 682. )

    Verify source ↗

    Some shareholders may demand that the corporation buy their dissenting shares for cash at fair market value if the chapter’s conditions are met.

    ## 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 13. Dissenters’ Rights [1300 - 1313] ( Chapter 13 added by Stats. 1975, Ch. 682. ) ## 1300. (a) If the approval of the outstanding shares (Section 152) of a corporation is required for a reorganization under subdivisions (a) and (b) or subdivision (e) or (f) of Section 1201, each shareholder of the corporation entitled to vote on the transaction and each shareholder of a subsidiary corporation in a short-form merger may, by complying with this chapter, require the corporation in which the shareholder holds shares to purchase for cash at their fair market value the shares owned by the shareholder which are dissenting shares as defined in subdivision (b). The fair market value shall be determined as of the day of, and immediately prior to, the first announcement of the terms of the proposed reorganization or short-form merger, excluding any appreciation or depreciation in consequence of the proposed reorganization or short-form merger, as adjusted for any stock split, reverse stock split, or share dividend that becomes effective thereafter. (b) As used in this chapter, “dissenting shares” means shares to which all of the following apply: (1) That were not, immediately prior to the reorganization or short-form merger, listed on any national securities exchange certified by the Commissioner of Financial Protection and Innovation under subdivision (o) of Section 25100, and the notice of meeting of shareholders to act upon the reorganization summarizes this section and Sections 1301, 1302, 1303, and 1304; provided, however, that this provision does not apply to any shares with respect to which there exists any restriction on transfer imposed by the corporation or by any law or regulation; and provided, further, that this provision does not apply to any shares where the holder of those shares is required, by the terms of the reorganization or short-form merger, to accept for the shares anything except: (A) shares of any other corporation, which shares, at the time the reorganization or short-form merger is effective, are listed on any national securities exchange certified by the Commissioner of Financial Protection and Innovation under subdivision (o) of Section 25100; (B) cash in lieu of fractional shares described in the foregoing subparagraph (A); or (C) any combination of the shares and cash in lieu of fractional shares described in the foregoing subparagraphs (A) and (B). (2) That were outstanding on the date for the determination of shareholders entitled to vote on the reorganization and (A) were not voted in favor of the reorganization or, (B) if described in paragraph (1), were voted against the reorganization, or were held of record on the effective date of a short-form merger; provided, however, that subparagraph (A) rather than subparagraph (B) of this paragraph applies in any case where the approval required by Section 1201 is sought by written consent rather than at a meeting. (3) That the dissenting shareholder has demanded that the corporation purchase at their fair market value, in accordance with Section 1301. (4) That the dissenting shareholder has submitted for endorsement, in accordance with Section 1302. (c) As used in this chapter, “dissenting shareholder” means the recordholder of dissenting shares and includes a transferee of record. (Amended by Stats. 2022, Ch. 452, Sec. 48. (SB 1498) Effective January 1, 2023.)
  171. 1301.

    ## 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 13. Dissenters’ Rights [1300 - 1313] ( Chapter 13 added by Stats. 1975, Ch. 682. )

    Verify source ↗

    In a reorganization, the corporation must send affected shareholders a notice and related documents within 10 days, and a shareholder who wants cash for dissenting shares must make a written demand by the stated deadline.

    ## 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 13. Dissenters’ Rights [1300 - 1313] ( Chapter 13 added by Stats. 1975, Ch. 682. ) ## 1301. (a) If, in the case of a reorganization, any shareholders of a corporation have a right under Section 1300, subject to compliance with paragraphs (3) and (4) of subdivision (b) thereof, to require the corporation to purchase their shares for cash, that corporation shall mail to each of those shareholders a notice of the approval of the reorganization by its outstanding shares (Section 152) within 10 days after the date of that approval, accompanied by a copy of Sections 1300, 1302, 1303, and 1304 and this section, a statement of the price determined by the corporation to represent the fair market value of the dissenting shares, and a brief description of the procedure to be followed if the shareholder desires to exercise the shareholder’s right under those sections. The statement of price constitutes an offer by the corporation to purchase at the price stated any dissenting shares as defined in subdivision (b) of Section 1300, unless they lose their status as dissenting shares under Section 1309. (b) Any shareholder who has a right to require the corporation to purchase the shareholder’s shares for cash under Section 1300, subject to compliance with paragraphs (3) and (4) of subdivision (b) thereof, and who desires the corporation to purchase shares shall make written demand upon the corporation for the purchase of those shares and payment to the shareholder in cash of their fair market value. The demand is not effective for any purpose unless it is received by the corporation or any transfer agent thereof (1) in the case of shares described in subdivision (b) of Section 1300, not later than the date of the shareholders’ meeting to vote upon the reorganization, or (2) in any other case, within 30 days after the date on which the notice of the approval by the outstanding shares pursuant to subdivision (a) or the notice pursuant to subdivision (h) of Section 1110 was mailed to the shareholder. (c) The demand shall state the number and class of the shares held of record by the shareholder which the shareholder demands that the corporation purchase and shall contain a statement of what the shareholder claims to be the fair market value of those shares as determined pursuant to subdivision (a) of Section 1300. The statement of fair market value constitutes an offer by the shareholder to sell the shares at that price. (Amended by Stats. 2012, Ch. 473, Sec. 2. (AB 1680) Effective January 1, 2013.)
  172. 1302.

    ## 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 13. Dissenters’ Rights [1300 - 1313] ( Chapter 13 added by Stats. 1975, Ch. 682. )

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    A shareholder who wants the corporation to buy dissenting shares must, within 30 days after the relevant notice is mailed, submit the required certificates or written notice to the corporation or its transfer agent.

    ## 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 13. Dissenters’ Rights [1300 - 1313] ( Chapter 13 added by Stats. 1975, Ch. 682. ) ## 1302. Within 30 days after the date on which notice of the approval by the outstanding shares or the notice pursuant to subdivision (h) of Section 1110 was mailed to the shareholder, the shareholder shall submit to the corporation at its principal office or at the office of any transfer agent thereof, (a) if the shares are certificated securities, the shareholder’s certificates representing any shares which the shareholder demands that the corporation purchase, to be stamped or endorsed with a statement that the shares are dissenting shares or to be exchanged for certificates of appropriate denomination so stamped or endorsed or (b) if the shares are uncertificated securities, written notice of the number of shares which the shareholder demands that the corporation purchase. Upon subsequent transfers of the dissenting shares on the books of the corporation, the new certificates, initial transaction statement, and other written statements issued therefor shall bear a like statement, together with the name of the original dissenting holder of the shares. (Amended by Stats. 2012, Ch. 473, Sec. 3. (AB 1680) Effective January 1, 2013.)
  173. 1303.

    ## 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 13. Dissenters’ Rights [1300 - 1313] ( Chapter 13 added by Stats. 1975, Ch. 682. )

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    A dissenting shareholder is entitled to the agreed price plus interest if the corporation and shareholder agree on dissenting shares and price. The corporation must pay the fair market value within 30 days after the amount is agreed or reorganization conditions are satisfied, whichever is later, subject to Section 1306 and any contrary agreement.

    ## 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 13. Dissenters’ Rights [1300 - 1313] ( Chapter 13 added by Stats. 1975, Ch. 682. ) ## 1303. (a) If the corporation and the shareholder agree that the shares are dissenting shares and agree upon the price of the shares, the dissenting shareholder is entitled to the agreed price with interest thereon at the legal rate on judgments from the date of the agreement. Any agreements fixing the fair market value of any dissenting shares as between the corporation and the holders thereof shall be filed with the secretary of the corporation. (b) Subject to the provisions of Section 1306, payment of the fair market value of dissenting shares shall be made within 30 days after the amount thereof has been agreed or within 30 days after any statutory or contractual conditions to the reorganization are satisfied, whichever is later, and in the case of certificated securities, subject to surrender of the certificates therefor, unless provided otherwise by agreement. (Amended by Stats. 1986, Ch. 766, Sec. 24.)
  174. 1304.

    ## 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 13. Dissenters’ Rights [1300 - 1313] ( Chapter 13 added by Stats. 1975, Ch. 682. )

    Verify source ↗

    This section lets a shareholder or interested corporation ask a superior court to decide whether shares are dissenting shares and what they are worth, but the filing must be made within six months after the notice was mailed.

    ## 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 13. Dissenters’ Rights [1300 - 1313] ( Chapter 13 added by Stats. 1975, Ch. 682. ) ## 1304. (a) If the corporation denies that the shares are dissenting shares, or the corporation and the shareholder fail to agree upon the fair market value of the shares, then the shareholder demanding purchase of such shares as dissenting shares or any interested corporation, within six months after the date on which notice of the approval by the outstanding shares (Section 152) or notice pursuant to subdivision (h) of Section 1110 was mailed to the shareholder, but not thereafter, may file a complaint in the superior court of the proper county praying the court to determine whether the shares are dissenting shares or the fair market value of the dissenting shares or both or may intervene in any action pending on such a complaint. (b) Two or more dissenting shareholders may join as plaintiffs or be joined as defendants in any such action and two or more such actions may be consolidated. (c) On the trial of the action, the court shall determine the issues. If the status of the shares as dissenting shares is in issue, the court shall first determine that issue. If the fair market value of the dissenting shares is in issue, the court shall determine, or shall appoint one or more impartial appraisers to determine, the fair market value of the shares. (Amended by Stats. 2012, Ch. 473, Sec. 4. (AB 1680) Effective January 1, 2013.)
  175. 1305.

    ## 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 13. Dissenters’ Rights [1300 - 1313] ( Chapter 13 added by Stats. 1975, Ch. 682. )

    Verify source ↗

    This section sets the court appraisal and payment process for dissenting shares, including report filing, court confirmation or valuation, judgment, payment timing, appeal, and costs.

    ## 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 13. Dissenters’ Rights [1300 - 1313] ( Chapter 13 added by Stats. 1975, Ch. 682. ) ## 1305. (a) If the court appoints an appraiser or appraisers, they shall proceed forthwith to determine the fair market value per share. Within the time fixed by the court, the appraisers, or a majority of them, shall make and file a report in the office of the clerk of the court. Thereupon, on the motion of any party, the report shall be submitted to the court and considered on such evidence as the court considers relevant. If the court finds the report reasonable, the court may confirm it. (b) If a majority of the appraisers appointed fail to make and file a report within 10 days from the date of their appointment or within such further time as may be allowed by the court or the report is not confirmed by the court, the court shall determine the fair market value of the dissenting shares. (c) Subject to the provisions of Section 1306, judgment shall be rendered against the corporation for payment of an amount equal to the fair market value of each dissenting share multiplied by the number of dissenting shares which any dissenting shareholder who is a party, or who has intervened, is entitled to require the corporation to purchase, with interest thereon at the legal rate from the date on which judgment was entered. (d) Any such judgment shall be payable forthwith with respect to uncertificated securities and, with respect to certificated securities, only upon the endorsement and delivery to the corporation of the certificates for the shares described in the judgment. Any party may appeal from the judgment. (e) The costs of the action, including reasonable compensation to the appraisers to be fixed by the court, shall be assessed or apportioned as the court considers equitable, but, if the appraisal exceeds the price offered by the corporation, the corporation shall pay the costs (including in the discretion of the court attorneys’ fees, fees of expert witnesses and interest at the legal rate on judgments from the date of compliance with Sections 1300, 1301 and 1302 if the value awarded by the court for the shares is more than 125 percent of the price offered by the corporation under subdivision (a) of Section 1301). (Amended by Stats. 1986, Ch. 766, Sec. 25.)
  176. 1306.

    ## 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 13. Dissenters’ Rights [1300 - 1313] ( Chapter 13 added by Stats. 1975, Ch. 682. )

    Verify source ↗

    If Chapter 5 blocks payment of fair market value to dissenting shareholders, they become creditors of the corporation and receive that amount plus interest at the legal rate on judgments.

    ## 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 13. Dissenters’ Rights [1300 - 1313] ( Chapter 13 added by Stats. 1975, Ch. 682. ) ## 1306. To the extent that the provisions of Chapter 5 prevent the payment to any holders of dissenting shares of their fair market value, they shall become creditors of the corporation for the amount thereof together with interest at the legal rate on judgments until the date of payment, but subordinate to all other creditors in any liquidation proceeding, such debt to be payable when permissible under the provisions of Chapter 5. (Repealed and added by Stats. 1975, Ch. 682.)
  177. 1307.

    ## 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 13. Dissenters’ Rights [1300 - 1313] ( Chapter 13 added by Stats. 1975, Ch. 682. )

    Verify source ↗

    The corporation must credit certain cash dividends on dissenting shares against the amount it owes for those shares.

    ## 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 13. Dissenters’ Rights [1300 - 1313] ( Chapter 13 added by Stats. 1975, Ch. 682. ) ## 1307. Cash dividends declared and paid by the corporation upon the dissenting shares after the date of approval of the reorganization by the outstanding shares (Section 152) and prior to payment for the shares by the corporation shall be credited against the total amount to be paid by the corporation therefor. (Repealed and added by Stats. 1975, Ch. 682.)
  178. 1308.

    ## 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 13. Dissenters’ Rights [1300 - 1313] ( Chapter 13 added by Stats. 1975, Ch. 682. )

    Verify source ↗

    Dissenting shareholders keep their share-related rights and privileges unless this chapter expressly limits them, and they cannot withdraw a payment demand unless the corporation agrees.

    ## 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 13. Dissenters’ Rights [1300 - 1313] ( Chapter 13 added by Stats. 1975, Ch. 682. ) ## 1308. Except as expressly limited in this chapter, holders of dissenting shares continue to have all the rights and privileges incident to their shares, until the fair market value of their shares is agreed upon or determined. A dissenting shareholder may not withdraw a demand for payment unless the corporation consents thereto. (Repealed and added by Stats. 1975, Ch. 682.)
  179. 1309.

    ## 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 13. Dissenters’ Rights [1300 - 1313] ( Chapter 13 added by Stats. 1975, Ch. 682. )

    Verify source ↗

    Dissenting shares can lose that status, and holders lose the right to require the corporation to buy them, if any listed event happens.

    ## 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 13. Dissenters’ Rights [1300 - 1313] ( Chapter 13 added by Stats. 1975, Ch. 682. ) ## 1309. Dissenting shares lose their status as dissenting shares and the holders thereof cease to be dissenting shareholders and cease to be entitled to require the corporation to purchase their shares upon the happening of any of the following: (a) The corporation abandons the reorganization. Upon abandonment of the reorganization, the corporation shall pay on demand to any dissenting shareholder who has initiated proceedings in good faith under this chapter all necessary expenses incurred in such proceedings and reasonable attorneys’ fees. (b) The shares are transferred prior to their submission for endorsement in accordance with Section 1302 or are surrendered for conversion into shares of another class in accordance with the articles. (c) The dissenting shareholder and the corporation do not agree upon the status of the shares as dissenting shares or upon the purchase price of the shares, and neither files a complaint or intervenes in a pending action as provided in Section 1304, within six months after the date on which notice of the approval by the outstanding shares or notice pursuant to subdivision (h) of Section 1110 was mailed to the shareholder. (d) The dissenting shareholder, with the consent of the corporation, withdraws the shareholder’s demand for purchase of the dissenting shares. (Amended by Stats. 2012, Ch. 473, Sec. 5. (AB 1680) Effective January 1, 2013.)
  180. 1310.

    ## 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 13. Dissenters’ Rights [1300 - 1313] ( Chapter 13 added by Stats. 1975, Ch. 682. )

    Verify source ↗

    If litigation challenges the sufficiency or regularity of shareholder votes approving a reorganization, proceedings under Sections 1304 and 1305 are suspended until that litigation is finally decided.

    ## 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 13. Dissenters’ Rights [1300 - 1313] ( Chapter 13 added by Stats. 1975, Ch. 682. ) ## 1310. If litigation is instituted to test the sufficiency or regularity of the votes of the shareholders in authorizing a reorganization, any proceedings under Sections 1304 and 1305 shall be suspended until final determination of such litigation. (Repealed and added by Stats. 1975, Ch. 682.)
  181. 1311.

    ## 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 13. Dissenters’ Rights [1300 - 1313] ( Chapter 13 added by Stats. 1975, Ch. 682. )

    Verify source ↗

    This section says the chapter does not apply to certain shares whose terms already specify the amount payable in a reorganization or merger, except for Section 1312.

    ## 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 13. Dissenters’ Rights [1300 - 1313] ( Chapter 13 added by Stats. 1975, Ch. 682. ) ## 1311. This chapter, except Section 1312, does not apply to classes of shares whose terms and provisions specifically set forth the amount to be paid in respect to such shares in the event of a reorganization or merger. (Amended by Stats. 1988, Ch. 919, Sec. 8.)
  182. 1312.

    ## 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 13. Dissenters’ Rights [1300 - 1313] ( Chapter 13 added by Stats. 1975, Ch. 682. )

    Verify source ↗

    Certain dissenting shareholders may not challenge the reorganization or short-form merger, and courts are generally barred from stopping the deal, with limited exceptions.

    ## 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 13. Dissenters’ Rights [1300 - 1313] ( Chapter 13 added by Stats. 1975, Ch. 682. ) ## 1312. (a) No shareholder of a corporation who has a right under this chapter to demand payment of cash for the shares held by the shareholder shall have any right at law or in equity to attack the validity of the reorganization or short-form merger, or to have the reorganization or short-form merger set aside or rescinded, except in an action to test whether the number of shares required to authorize or approve the reorganization have been legally voted in favor thereof; but any holder of shares of a class whose terms and provisions specifically set forth the amount to be paid in respect to them in the event of a reorganization or short-form merger is entitled to payment in accordance with those terms and provisions or, if the principal terms of the reorganization are approved pursuant to subdivision (b) of Section 1202, is entitled to payment in accordance with the terms and provisions of the approved reorganization. (b) If one of the parties to a reorganization or short-form merger is directly or indirectly controlled by, or under common control with, another party to the reorganization or short-form merger, subdivision (a) shall not apply to any shareholder of such party who has not demanded payment of cash for such shareholder’s shares pursuant to this chapter; but if the shareholder institutes any action to attack the validity of the reorganization or short-form merger or to have the reorganization or short-form merger set aside or rescinded, the shareholder shall not thereafter have any right to demand payment of cash for the shareholder’s shares pursuant to this chapter. The court in any action attacking the validity of the reorganization or short-form merger or to have the reorganization or short-form merger set aside or rescinded shall not restrain or enjoin the consummation of the transaction except upon 10 days’ prior notice to the corporation and upon a determination by the court that clearly no other remedy will adequately protect the complaining shareholder or the class of shareholders of which such shareholder is a member. (c) If one of the parties to a reorganization or short-form merger is directly or indirectly controlled by, or under common control with, another party to the reorganization or short-form merger, in any action to attack the validity of the reorganization or short-form merger or to have the reorganization or short-form merger set aside or rescinded, (1) a party to a reorganization or short-form merger which controls another party to the reorganization or short-form merger shall have the burden of proving that the transaction is just and reasonable as to the shareholders of the controlled party, and (2) a person who controls two or more parties to a reorganization shall have the burden of proving that the transaction is just and reasonable as to the shareholders of any party so controlled. (Amended by Stats. 1988, Ch. 919, Sec. 9.)
  183. 1313.

    ## 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 13. Dissenters’ Rights [1300 - 1313] ( Chapter 13 added by Stats. 1975, Ch. 682. )

    Verify source ↗

    A conversion under Chapter 11.5 is treated as a reorganization for applying this chapter, to the extent Section 1159 provides.

    ## 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 13. Dissenters’ Rights [1300 - 1313] ( Chapter 13 added by Stats. 1975, Ch. 682. ) ## 1313. A conversion pursuant to Chapter 11.5 (commencing with Section 1150) shall be deemed to constitute a reorganization for purposes of applying the provisions of this chapter, in accordance with and to the extent provided in Section 1159. (Added by Stats. 2002, Ch. 480, Sec. 7. Effective January 1, 2003.)
  184. 13200.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 1. General Provisions and Definitions [13200 - 13208] ( Chapter 1 added by Stats. 1953, Ch. 207. )

    Verify source ↗

    This section names this part the Fish Marketing Act.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 1. General Provisions and Definitions [13200 - 13208] ( Chapter 1 added by Stats. 1953, Ch. 207. ) ## 13200. This part shall be known as “the Fish Marketing Act.” (Amended by Stats. 1957, Ch. 2261.)
  185. 13201.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 1. General Provisions and Definitions [13200 - 13208] ( Chapter 1 added by Stats. 1953, Ch. 207. )

    Verify source ↗

    This section states the purpose of the part: to promote orderly marketing of fish and fishery products, reduce speculation and waste, improve distribution efficiency, and stabilize the market.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 1. General Provisions and Definitions [13200 - 13208] ( Chapter 1 added by Stats. 1953, Ch. 207. ) ## 13201. This part is enacted in order to promote, foster, and encourage the intelligent and orderly marketing of fish and fishery products through cooperation; to eliminate speculation and waste; to make the distribution of fish and fishery products between producer and consumer as direct as can be efficiently done; and to stabilize the marketing of fish and fishery products. (Amended by Stats. 1957, Ch. 2261.)
  186. 13202.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 1. General Provisions and Definitions [13200 - 13208] ( Chapter 1 added by Stats. 1953, Ch. 207. )

    Verify source ↗

    This section defines “fishery products,” “member,” and “association” for this part of the Corporations Code.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 1. General Provisions and Definitions [13200 - 13208] ( Chapter 1 added by Stats. 1953, Ch. 207. ) ## 13202. As used in this part: (a) “Fishery products” includes fish, crustaceans, mollusks, and marine products for human consumption. (b) “Member” includes members of associations without capital stock and holders of common stock in associations organized with shares of stock. (c) “Association” means any corporation organized under this part. (Amended by Stats. 1957, Ch. 2261.)
  187. 13203.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 1. General Provisions and Definitions [13200 - 13208] ( Chapter 1 added by Stats. 1953, Ch. 207. )

    Verify source ↗

    Associations are deemed nonprofit if they are not organized to make profit for themselves or their members, and only serve their members as producers of fishery products.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 1. General Provisions and Definitions [13200 - 13208] ( Chapter 1 added by Stats. 1953, Ch. 207. ) ## 13203. Associations shall be deemed “nonprofit,” inasmuch as they are not organized to make profit for themselves, as such, or for their members, as such, but only for their members as producers of fishery products. (Added by Stats. 1953, Ch. 207.)
  188. 13204.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 1. General Provisions and Definitions [13200 - 13208] ( Chapter 1 added by Stats. 1953, Ch. 207. )

    Verify source ↗

    General Corporation Law provisions, powers, and rights apply to associations unless they conflict with this part’s express provisions.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 1. General Provisions and Definitions [13200 - 13208] ( Chapter 1 added by Stats. 1953, Ch. 207. ) ## 13204. The provisions of the General Corporation Law and all powers and rights thereunder, apply to associations, except where such provisions are in conflict with or inconsistent with the express provisions of this part. (Amended by Stats. 1957, Ch. 2261.)
  189. 13205.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 1. General Provisions and Definitions [13200 - 13208] ( Chapter 1 added by Stats. 1953, Ch. 207. )

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    Associations are not subject to the Corporate Securities Law, and they may issue membership certificates, stock, or other securities under this division without getting a permit from the Commissioner of Financial Protection and Innovation.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 1. General Provisions and Definitions [13200 - 13208] ( Chapter 1 added by Stats. 1953, Ch. 207. ) ## 13205. No association is subject in any manner to the terms of the Corporate Securities Law and all associations may issue their membership certificates or stock or other securities as provided in this division without the necessity of any permit from the Commissioner of Financial Protection and Innovation. (Amended by Stats. 2022, Ch. 452, Sec. 61. (SB 1498) Effective January 1, 2023.)
  190. 13206.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 1. General Provisions and Definitions [13200 - 13208] ( Chapter 1 added by Stats. 1953, Ch. 207. )

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    An association and certain marketing agreements are treated as not being illegal restraints of trade, conspiracies, monopolies, or price-fixing under this section.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 1. General Provisions and Definitions [13200 - 13208] ( Chapter 1 added by Stats. 1953, Ch. 207. ) ## 13206. An association shall be deemed not to be a conspiracy nor a combination in restraint of trade nor an illegal monopoly; nor an attempt to lessen competition or to fix prices arbitrarily or to create a combination or pool in violation of any law of the State; and the marketing contracts and agreements between the association and its members and any agreements authorized in this part shall be considered not to be illegal nor in restraint of trade nor contrary to the provisions of any statute enacted against pooling or combinations. (Amended by Stats. 1957, Ch. 2261.)
  191. 13207.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 1. General Provisions and Definitions [13200 - 13208] ( Chapter 1 added by Stats. 1953, Ch. 207. )

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    Laws that conflict with this part do not apply to associations, and exemptions for fishery products held by an individual producer also apply to the same products when delivered by members and held by the association.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 1. General Provisions and Definitions [13200 - 13208] ( Chapter 1 added by Stats. 1953, Ch. 207. ) ## 13207. Any provisions of law which are in conflict with this part shall not be construed as applying to associations. Any exemptions under any laws applying to fishery products in the possession or under the control of the individual producer shall apply similarly and completely to such fishery products delivered by its members, in the possession or under the control of the association. (Amended by Stats. 1957, Ch. 2261.)
  192. 13208.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 1. General Provisions and Definitions [13200 - 13208] ( Chapter 1 added by Stats. 1953, Ch. 207. )

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    Two or more associations may merge into one constituent association or consolidate into a new association.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 1. General Provisions and Definitions [13200 - 13208] ( Chapter 1 added by Stats. 1953, Ch. 207. ) ## 13208. Any two or more associations may be merged into one such constituent association or consolidated into a new association. Such merger or consolidation shall be made in the manner prescribed by the General Corporation Law for domestic corporations. (Added by Stats. 1953, Ch. 207.)
  193. 13220.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 2. Formation, Articles, and By-laws [13220 - 13251] ( Chapter 2 added by Stats. 1953, Ch. 207. ) ## ARTICLE 1. Formation [13220- 13220.] ( Article 1 added by Stats. 1953, Ch. 207. )

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    Five or more qualifying persons may form an association under this division.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 2. Formation, Articles, and By-laws [13220 - 13251] ( Chapter 2 added by Stats. 1953, Ch. 207. ) ## ARTICLE 1. Formation [13220- 13220.] ( Article 1 added by Stats. 1953, Ch. 207. ) ## 13220. Five or more persons, a majority of whom are residents of this State, engaged in the production of fishery products, may form an association, with or without shares of stock, under the provisions of this division. (Added by Stats. 1953, Ch. 207.)
  194. 13225.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 2. Formation, Articles, and By-laws [13220 - 13251] ( Chapter 2 added by Stats. 1953, Ch. 207. ) ## ARTICLE 2. Articles of Incorporation [13225 - 13230] ( Article 2 added by Stats. 1953, Ch. 207. )

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    Articles of incorporation must be signed, acknowledged, and filed as required by the General Corporation Law for domestic corporations.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 2. Formation, Articles, and By-laws [13220 - 13251] ( Chapter 2 added by Stats. 1953, Ch. 207. ) ## ARTICLE 2. Articles of Incorporation [13225 - 13230] ( Article 2 added by Stats. 1953, Ch. 207. ) ## 13225. Articles of incorporation shall be signed, acknowledged, and filed in the manner prescribed by the General Corporation Law for domestic corporations. (Added by Stats. 1953, Ch. 207.)
  195. 13226.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 2. Formation, Articles, and By-laws [13220 - 13251] ( Chapter 2 added by Stats. 1953, Ch. 207. ) ## ARTICLE 2. Articles of Incorporation [13225 - 13230] ( Article 2 added by Stats. 1953, Ch. 207. )

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    The articles of incorporation must state specific basic details about the association, its office, directors, addresses, and initial agent for service of process.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 2. Formation, Articles, and By-laws [13220 - 13251] ( Chapter 2 added by Stats. 1953, Ch. 207. ) ## ARTICLE 2. Articles of Incorporation [13225 - 13230] ( Article 2 added by Stats. 1953, Ch. 207. ) ## 13226. The articles of incorporation shall state: (a) The name of the association. (b) The purposes for which it is formed. (c) The county where the principal office for the transaction of business of the corporation is to be located. (d) The number of directors thereof, which shall be not less than three and may be any number in excess thereof; the term of office of such directors; and the names and residence of those who are to serve as directors for the first year, or until election and qualification of their successors. (e) The initial street address of the association. (f) The initial mailing address of the association, if different from the initial street address. (g) The name and street address in this state of the association’s initial agent for service of process in accordance with subdivision (b) of Section 1502. (Amended by Stats. 2012, Ch. 494, Sec. 34. (SB 1532) Effective January 1, 2013.)
  196. 13227.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 2. Formation, Articles, and By-laws [13220 - 13251] ( Chapter 2 added by Stats. 1953, Ch. 207. ) ## ARTICLE 2. Articles of Incorporation [13225 - 13230] ( Article 2 added by Stats. 1953, Ch. 207. )

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    If an association has stock shares, its articles must state the number of shares, any par value per share, the total par value, or that the shares have no par value.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 2. Formation, Articles, and By-laws [13220 - 13251] ( Chapter 2 added by Stats. 1953, Ch. 207. ) ## ARTICLE 2. Articles of Incorporation [13225 - 13230] ( Article 2 added by Stats. 1953, Ch. 207. ) ## 13227. If the association is organized with shares of stock, the articles shall state the number of shares which may be issued and if the shares are to have a par value, the par value of each share, and the aggregate par value of all shares; and if the shares are to be without par value it shall be so stated. (Added by Stats. 1953, Ch. 207.)
  197. 13228.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 2. Formation, Articles, and By-laws [13220 - 13251] ( Chapter 2 added by Stats. 1953, Ch. 207. ) ## ARTICLE 2. Articles of Incorporation [13225 - 13230] ( Article 2 added by Stats. 1953, Ch. 207. )

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    If shares are classified, the articles of incorporation must describe each class of shares and state the number of shares and the preferences, rights, privileges, and restrictions for each class.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 2. Formation, Articles, and By-laws [13220 - 13251] ( Chapter 2 added by Stats. 1953, Ch. 207. ) ## ARTICLE 2. Articles of Incorporation [13225 - 13230] ( Article 2 added by Stats. 1953, Ch. 207. ) ## 13228. If the shares are to be classified, the articles shall contain a description of the classes of shares and a statement of the number of shares of each kind or class and the nature and extent of the preferences, rights, privileges and restrictions granted to or imposed upon the holders of the respective classes of stock. (Added by Stats. 1953, Ch. 207.)
  198. 13229.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 2. Formation, Articles, and By-laws [13220 - 13251] ( Chapter 2 added by Stats. 1953, Ch. 207. ) ## ARTICLE 2. Articles of Incorporation [13225 - 13230] ( Article 2 added by Stats. 1953, Ch. 207. )

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    An association without shares must have articles that say whether member voting power and property rights are equal or unequal, explain the rules if they are unequal, and provide for admitting new members with voting and property rights under those rules.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 2. Formation, Articles, and By-laws [13220 - 13251] ( Chapter 2 added by Stats. 1953, Ch. 207. ) ## ARTICLE 2. Articles of Incorporation [13225 - 13230] ( Article 2 added by Stats. 1953, Ch. 207. ) ## 13229. If the association is organized without shares of stock, the articles shall state whether the voting power and the property rights and interest of each member are equal or unequal; and if unequal the general rule or rules applicable to all members by which the voting power and the property rights and interests, respectively, of each member may be and are determined and fixed; and shall also provide for the admission of new members who shall be entitled to vote and to share in the property of the association with the old members, in accordance with such general rule or rules. (Added by Stats. 1953, Ch. 207.)
  199. 13230.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 2. Formation, Articles, and By-laws [13220 - 13251] ( Chapter 2 added by Stats. 1953, Ch. 207. ) ## ARTICLE 2. Articles of Incorporation [13225 - 13230] ( Article 2 added by Stats. 1953, Ch. 207. )

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    An association may alter or amend its articles of incorporation under the rules and purposes set by the General Corporation Law for domestic corporations.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 2. Formation, Articles, and By-laws [13220 - 13251] ( Chapter 2 added by Stats. 1953, Ch. 207. ) ## ARTICLE 2. Articles of Incorporation [13225 - 13230] ( Article 2 added by Stats. 1953, Ch. 207. ) ## 13230. The articles of incorporation of any association may be altered or amended in the manner and for the purposes prescribed by the General Corporation Law for domestic corporations. (Added by Stats. 1953, Ch. 207.)
  200. 13240.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 2. Formation, Articles, and By-laws [13220 - 13251] ( Chapter 2 added by Stats. 1953, Ch. 207. ) ## ARTICLE 3. By-laws [13240 - 13251] ( Article 3 added by Stats. 1953, Ch. 207. )

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    Each association must adopt by-laws within 30 days after incorporation, and those by-laws cannot conflict with this part.

    ## Corporations Code - CORP ## TITLE 1. CORPORATIONS [100 - 14707] ( Title 1 enacted by Stats. 1947, Ch. 1038. ) ## DIVISION 3. CORPORATIONS FOR SPECIFIC PURPOSES [12000 - 14707] ( Division 3 enacted by Stats. 1947, Ch. 1038. ) ## PART 3. FISH MARKETING [13200 - 13356] ( Part 3 added by Stats. 1953, Ch. 207. ) ## CHAPTER 2. Formation, Articles, and By-laws [13220 - 13251] ( Chapter 2 added by Stats. 1953, Ch. 207. ) ## ARTICLE 3. By-laws [13240 - 13251] ( Article 3 added by Stats. 1953, Ch. 207. ) ## 13240. Each association shall within 30 days after its incorporation, adopt for its government and management, a code of by-laws, not inconsistent with this part. A majority vote of the members or shares of stock issued and outstanding and entitled to vote, or the written assent of a majority of the members or of stockholders representing a majority of all the shares of stock issued and outstanding and entitled to vote, is necessary to adopt such by-laws and is effectual to repeal or amend any by-laws, or to adopt additional by-laws. The power to repeal and amend the by-laws, and adopt new by-laws, may, by a similar vote, or similar written assent, be delegated to the board of directors, which authority may, by a similar vote, or similar written assent, be revoked. (Amended by Stats. 1957, Ch. 2261.)

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