Can This Bylaw Provision Eliminate Shareholder Proposals?

Rule 14a-8 under the Securities Exchange Act of 1934 requires companies that are subject to the federal proxy rules to include shareholder proposals in their own proxy statements to shareholders, subject to certain procedural and substantive...

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...

Close Corporation Or Simply A Closely Held Corporation?

A corporation may have a single shareholder or tens of thousands of shareholders.  The former is often referred to as a "closely held corporation".  The California Corporations Code does not use or define the term "closely held corporation" although...

A Different Sort Of Standing Is At Issue In Federal Court Challenge To California Female Director Quota

Last November, a shareholder of OSI Systems, Inc. filed a complaint in the U.S. District Court for the Eastern District of California challenging California's law imposing female director quotas on publicly traded corporations headquartered in...

What Makes Common Stock, Common?

Suppose that the articles of incorporation provide that a corporation will have two classes of shares, with one class entitled to 90% of all dividends declared and assets upon liquidation and the other class to the remaining 10%.  Clearly, an...

Bill Threatens Further Obfuscation Of California's Board Quota Law

Two years ago, California State Senator Hannah-Beth Jackson introduced a bill imposing gender quotas on publicly held domestic or foreign corporations having their principal executive offices in California.  Then Governor Brown admitted "I don't...

Four Decades After Being Abolished, Some California Corporations Continue To Refer To "Treasury Stock"

Treasury shares are shares that a corporation has issued and then reacquired but not retired.  Hence, they are shares that have been issued but are no longer outstanding.  In some states, treasury shares retain some legal significance but not so in...

What Happens When A Board Fails To Determine The Fair Value Of The Consideration For Shares?

California Corporations Code Section 409(e) imposes a duty on the board of directors to determine "the fair value to the corporation in monetary terms of any consideration other than money for which shares are issued".  Does a board's failure to...

California Board Gender Quota Law Challenged In Federal Court

Cydney Posner at Cooley LLP wrote last week about a new challenge to California's Board Gender Quota law.  The lawsuit, Creighton Meland v. Alex Padilla, Secretary of State of California,was reportedly filed in federal district court in California...

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