Don't Sleep On Your Lost, Destroyed Or Stolen Stock Certificate, Darlin'
What Happens When A Corporation Cannot Afford To Pay Dissenting Shares?

Chapter 13 of the California General Corporation governs so-called "dissenters' rights".  In general, Chapter 13 provides that in certain specified transactions, a shareholder can require the corporation to purchase the shareholder's "dissenting...

A Farraginous Stew Of Share Certificate Legend Requirements

Section 418 of the California Corporations Code requires that the following six statements appear "on the certificate", to the extent applicable:

Why Does DTC Need A Nominee?

Section 416 of the California Corporations Code contemplates that corporations may issue shares in either certificated or uncertificated form.  If the corporations shares are not publicly traded, the holding system is likely to be direct - the...

Blockchain Shareholder Records - For A Limited Time Only In California

In 2018, California enacted legislation authorizing California corporations to include a provision in their articles of incorporation allowing the use of blockchain technology to record and track the issuance and transfer of stock certificates. ...

When A Distribution Is Not Subject To Chapter 5

Chapter 5 of the California Corporations Code prohibits a distribution to shareholders unless specified conditions are met. The most common type of distribution subject to these limitations is a dividend, but the term "distribution to shareholders"...

When Is Notice Given?

The California General Corporation includes several provisions requiring notice to either directors or shareholders.  Section 307, for example, requires that notice be given to directors of special meetings of the board.  The statute further...

Are Supermajority Board Voting Bylaws Effective?

Section 204 of the California Corporations Code lists a number of possible provisions that may be included in the articles and "which shall not be effective unless expressly provided in the articles".  Included in this list of permissible provisions...

The Ineluctably Absent Modality Of Creditor Derivative Claims

On Monday, I wrote about Berg & Berg Enterprises, LLC v. Boyle, 178 Cal. App. 4th 1020, 100 Cal. Rptr. 3d 875 (2009).  The Court of Appeal in Berg adopted the trust fund doctrine, holding that upon the actual insolvency of the corporations,...

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