Sections 900-911

California Corporations Code > Sections 900-911
CALIFORNIA GENERAL CORPORATION LAW - CHAPTER 9

Section 900:

(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 and, if a change in shares or the rights of shareholders or an exchange, reclassification or cancellation of shares or rights of shareholders 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 alter any statement which may appear in the original articles of the names and addresses of the first directors, nor the name and address of the initial agent, except to correct an error in the statement or to delete either after the corporation has filed a statement under Section 1502.

901. Before any shares have been issued, any amendment of the articles may be adopted by a writing signed by a majority of the incorporators, if directors were not named in the original articles and have not been elected, or, if directors were named in the original articles or have been elected, by a majority of the directors.

902. (a) After any shares have been issued, amendments may be adopted if approved by the board and approved by the outstanding shares (Section 152), either before or after the approval by the board. (b) Notwithstanding subdivision (a), an amendment extending the corporate existence or making the corporate existence perpetual may be adopted by a corporation organized prior to August 14, 1929, with approval by the board alone. (c) Notwithstanding subdivision (a), unless the corporation has more than one class of shares outstanding, an amendment effecting only a stock split (including an increase in the authorized number of shares in proportion thereto) may be adopted with approval by the board alone. (d) Notwithstanding subdivision (a), an amendment deleting the names and addresses of the first directors or the name and address of the initial agent may be adopted with approval by the board alone. (e) Whenever the articles require for corporate action the vote of a larger proportion or of all of the shares of any class or series, or of a larger proportion or of all of the directors, than is otherwise required by this division, the provision in the articles requiring such greater vote shall not be altered, amended or repealed except by such greater vote unless otherwise provided in the articles. (f) Notwithstanding subdivision (a), any amendment reducing the vote required for an amendment pursuant to subdivision (c) of Section 158 may not be adopted unless approved by the affirmative vote of at least two-thirds of each class of outstanding shares or such other vote as may then be specified by the articles of the corporation.

903. (a) A proposed amendment must be approved by the outstanding shares (Section 152) of a class, whether or not such class is entitled to vote thereon by the provisions of the articles, if the amendment would: (1) Increase or decrease the aggregate number of authorized shares of such class, other than an increase as provided in either subdivision (b) of Section 405 or subdivision (c) of Section 902. (2) Effect an exchange, reclassification, or cancellation of all or part of the shares of such class, including a reverse stock split but excluding a stock split. (3) Effect an exchange, or create a right of exchange, of all or part of the shares of another class into the shares of such class. (4) Change the rights, preferences, privileges or restrictions of the shares of such class. (5) Create a new class of shares having rights, preferences or privileges prior to the shares of such class, or increase the rights, preferences or privileges or the number of authorized shares of any class having rights, preferences or privileges prior to the shares of such class. (6) In the case of preferred shares, divide the shares of any class into series having different rights, preferences, privileges or restrictions or authorize the board to do so. (7) Cancel or otherwise affect dividends on the shares of such class which have accrued but have not been paid. (b) Different series of the same class shall not constitute different classes for the purpose of voting by classes except when a series is adversely affected by an amendment in a different manner than other shares of the same class. (c) In addition to approval by a class as provided in subdivision (a), a proposed amendment must also be approved by the outstanding voting shares (Section 152).

904. (a) Except as provided in subdivision (b), if any amendment of the articles would make shares assessable or would authorize remedy by action for the collection of an assessment on fully paid shares, it shall be approved by all of the outstanding shares affected regardless of limitations or restrictions on the voting rights thereof. (b) If a corporation is a mutual water company within the meaning of Section 2705 of the Public Utilities Code, an amendment of the articles to make the shares assessable or to amend prior article provisions authorizing assessment of shares shall be approved by the holders of at least two-thirds of the outstanding shares of any class affected by the amendment regardless of limitations or restrictions on the voting rights thereof. However, if the amendment would authorize remedy by action for the collection of an assessment on fully paid shares, the amendment shall be approved pursuant to subdivision (a).

905. In the case of amendments adopted after the corporation has issued any shares, the corporation shall file a certificate of amendment, which shall consist of an officers' certificate stating: (a) The wording of the amendment or amended articles in accordance with Section 907; (b) That the amendment has been approved by the board; (c) If the amendment is one for which the approval of the outstanding shares (Section 152) is required, that the amendment was approved by the required vote of shareholders in accordance with Section 902, 903 or 904; the total number of outstanding shares of each class entitled to vote with respect to the amendment; and that the number of shares of each class voting in favor of the amendment equaled or exceeded the vote required, specifying the percentage vote required of each class entitled to vote; and (d) 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. In the event of an amendment of the articles pursuant to a merger, the filing of the officers' certificate and agreement pursuant to Section 1103 or a certificate of ownership pursuant to subdivision (d) of Section 1110 shall be in lieu of any filing required under this chapter.

906. In the case of amendments adopted by the incorporators or the board under Section 901, the corporation shall file a certificate of amendment signed and verified by a majority of the incorporators or of the board, as the case may be, which shall state that the signers thereof constitute at least a majority of the incorporators or of the board, that the corporation has issued no shares and that they adopt the amendment or amendments therein set forth. In the case of amendments adopted by the incorporators, the certificate shall also state that directors were not named in the original articles and have not been elected. In the case of amendments adopted by the board under Section 901, the corporation may file a certificate of amendment pursuant to Section 905 in lieu of a certificate of amendment pursuant to this section.

907. (a) The certificate of amendment shall establish the wording of the amendment or amended articles by one or more of the following means: (1) By stating that the articles shall be amended to read as therein set forth in full. (2) By stating that any provision of the articles, which shall be identified by the numerical or other designation given it in the articles or by stating the wording thereof, shall be stricken from the articles or shall be amended to read as set forth in the certificate. (3) By stating that the provisions set forth therein shall be added to the articles. (b) If the purpose of the amendment is to effect a stock split or reverse stock split or to reclassify, cancel, exchange, or otherwise change outstanding shares, the amended articles shall state the effect thereof on outstanding shares. (c) In the event of an amendment to change the statement of authorized shares from a single class of shares to two classes, the shares outstanding immediately prior to the amendment are automatically considered to be the same number of shares of the common stock class. If the designation of only one of the two classes includes "common," that class is the common stock class. If the designation of both classes or of neither class includes "common" but one of the two classes has limited or no voting rights, the class whose voting rights are not limited is the common stock class for the purpose of this subdivision. This subdivision has no application if the amendment of articles includes a statement of the effect of the amendment on outstanding shares pursuant to subdivision (b). (d) An amendment which adds or eliminates a stated par value or changes the stated par value and which does not also state the effect of the amendment on outstanding shares is not thereby subject to subdivision (b).

908. Upon the filing of the certificate of amendment, the articles shall be amended in accordance with the certificate and any stock split, reverse stock split, reclassification, cancellation, exchange or other change in shares 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.

909. A corporation formed for a limited period may at any time subsequent to the expiration of the term of its corporate existence, if it has continuously acted as a corporation and done business as such, 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 201, 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. The certificate of amendment shall set forth that the corporation continuously acted as a corporation and did business as such from the expiration of its term of corporate existence to the date of the amendment.

910. (a) A corporation may restate in a single certificate the entire text of its articles as amended by filing an officers' certificate or, in circumstances where incorporators or the board may amend a corporation's articles pursuant to Sections 901 and 906, a certificate signed and verified by a majority of the incorporators or the board, as applicable, entitled "Restated Articles of Incorporation of (insert name of corporation)" which shall set forth the articles as amended to the date of the filing of the certificate, except that the signatures and acknowledgments of the articles by the incorporators and any statements regarding the effect of any prior amendment upon outstanding shares and any provisions of agreements of merger (other than amendments to the articles of the surviving corporation) and the names and addresses of the first directors and of the initial agent for service of process shall be omitted (except that the names and addresses of the initial agent for service of process and, if previously set forth in the articles, the initial directors, shall not be omitted prior to the time that the corporation has filed a statement under Section 1502). Such omissions are not alterations or amendments of the articles. The certificate may also itself alter or amend the articles in any respect, in which case the certificate must comply with Section 905 or 906, as the case may be, and Section 907. (b) If the certificate does not itself alter or amend the articles in any respect, it shall be approved by the board or, prior to the issuance of any shares and the naming and election of directors, by a majority of the incorporators, and shall be subject to the provisions of this chapter relating to an amendment of the articles not requiring any approval of the outstanding shares (Section 152). 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 and, except for certificates approved by a majority of the incorporators, the certificate shall also state that the board has approved the restated articles. (c) Certificates of determination are a part of the articles within the meaning of this section. The provisions of such a certificate shall be given an article designation in the restated articles. (d) Restated articles of incorporation filed pursuant to this section shall supersede for all purposes the original articles and all amendments and certificates of determination filed prior thereto.

911. (a) A corporation may, by amendment of its articles pursuant to this section, convert to a nonprofit public benefit corporation, nonprofit mutual benefit corporation, nonprofit religious corporation, or cooperative corporation. (b) The amendment of the articles to convert to a nonprofit corporation shall revise the statement of purpose, delete the authorization for shares and any other provisions relating to authorized or issued shares, make such other changes as may be necessary or desired, and, if any shares have been issued, provide either for the cancellation of those shares or for the conversion of those shares to memberships of the nonprofit corporation. The amendment of the articles to convert to a cooperative corporation shall revise the statement of purpose, make such other changes as may be necessary or desired, and, if any shares have been issued, provide for the cancellation of those shares or for the conversion of those shares to memberships of the cooperative corporation, if necessary. (c) If shares have been issued, an amendment to convert to a nonprofit corporation shall be approved by all of the outstanding shares of all classes regardless of limitations or restrictions on the voting rights thereof and an amendment to convert to a cooperative corporation shall be approved by the outstanding shares (Section 152) of each class regardless of limitations or restrictions on the voting rights thereof. (d) If an amendment pursuant to this section is included in a merger agreement, the provisions of this section apply, except that any provision for cancellation or conversion of shares shall be in the merger agreement rather than in the amendment of the articles. (e) Notwithstanding subdivision (c), if a corporation is a mutual water company within the meaning of Section 2705 of the Public Utilities Code and under the terms of the conversion each outstanding share is converted to a membership of a nonprofit mutual benefit corporation, an amendment to convert to a nonprofit mutual benefit corporation shall be approved by the outstanding shares (Section 152) of each class regardless of limitations or restrictions on the voting rights thereof.

California Corporations Code > Sections 900-911
< Section 800 | Sections 1000-1002>