PART 1. GENERAL PROVISIONS AND DEFINITIONS GOVERNING PARTS 1 THROUGH 5 [5002. - 5080.]

Cal. Corporations Code - CORP 1.
in effect

Cal. Corporations Code - CORP § 5002. Section 5002.

Unless the provisions or the context otherwise requires, the general provisions and definitions set forth in this part govern the construction of this part and of Part 2 (commencing with Section 5110), Part 3 (commencing with Section 7110), Part 4 (commencing with Section 9110), and Part 5 (commencing with Section 9910) of this division.

Cal. Corporations Code - CORP § 5003. Section 5003.

(a) The provisions of this part apply to: (1) Corporations organized under Part 2, Part 3, and Part 4 of this division; (2) Corporations expressly subject to Part 2, Part 3 or Part 4 of this division pursuant to a particular provision of this division or Division 3 (commencing with Section 12000) or other specific statutory provision; (3) Corporations which pursuant to the express provisions of Part 1, Division 2 (commencing with Section 9000) in effect immediately prior to January 1, 1980, are subject to the provisions of Part 1 of Division 2 and which, on or after January 1, 1980, are subject to the Nonprofit Public Benefit Corporation Law, the Nonprofit Mutual Benefit Corporation Law or the Nonprofit Religious Corporation Law, pursuant to Section 9912. (4) Corporations expressly subject to Part 1, Division 2 (commencing with Section 9000) in effect immediately prior to January 1, 1980, pursuant to a particular provision of this division or Division 3 (commencing with Section 12000) or other specific statutory provision in effect immediately prior to January 1, 1980, and which, on or after January 1, 1980, are subject to the Nonprofit Public Benefit Corporation Law, the Nonprofit Mutual Benefit Corporation Law, or the Nonprofit Religious Corporation Law, pursuant to Section 9912; and (5) Corporations incorporated as permitted by subdivision (d) of Section 9911. (b) The existence of corporations formed or existing on the date of enactment or reenactment of this part, Part 2, Part 3, Part 4 or Part 5 shall not be affected by the enactment or reenactment of such parts or by any change in the requirements for the formation of corporations or by the amendment or repeal of the laws under which they were formed or created. (c) Neither the repeals effected by the enactment or reenactment of this part or of Part 2, Part 3, Part 4 or Part 5, nor the amendment thereof shall impair or take away any existing liability or cause of action against any corporation, its members, directors or officers incurred prior to the time of such enactment, reenactment or amendment.

Cal. Corporations Code - CORP § 5005. Section 5005.

Any corporation shall, as a condition of its existence as a corporation, be subject to the provisions of the Code of Civil Procedure authorizing the attachment of corporate property.

Cal. Corporations Code - CORP § 5005.1. Section 5005.1.

(a) Except for a liability that may be insured against pursuant to Division 4 (commencing with Section 3200) of the Labor Code, an authorized corporation may do any of the following: (1) Insure itself against all or any part of any tort liability. (2) Insure any employee of the corporation against all or any part of his or her liability for injury resulting from an act or omission in the scope of employment. (3) Insure any board member, officer, or volunteer of the corporation against any liability that may arise from any act or omission in the scope of participation with the corporation. (4) Insure itself against any loss arising from physical damage to motor vehicles owned or operated by the corporation. (5) Insure itself against the loss or damage to property of every kind, including, but not limited to, losses and expenses related to the loss of property. (b) (1) The arrangement authorized pursuant to this section shall only be available to an authorized corporation where that corporation has joined with two or more other authorized corporations to provide for the pooling of self-insured claims or losses. The pooling arrangement shall be organized as a nonprofit public benefit corporation pursuant to Part 2 (commencing with Section 5110) and shall not be considered insurance nor be subject to regulation under the Insurance Code. (2) A pooling arrangement shall include in every application form for membership and every risk pooling contract issued or renewed on or after January 1, 2016, and in boldface 10-point type on the front page, the following notice: “Notice: This risk pooling contract is issued by a pooling arrangement authorized by California Corporations Code Section 5005.1. The pooling arrangement is not subject to all of the insurance laws of the State of California and is not subject to regulation by the Insurance Commissioner. Insurance guaranty funds are not available to pay claims in the event the risk pool becomes insolvent.” (c) This section does not authorize a corporation organized pursuant to this division to pay for, or to insure, contract, or provide for payment for, any part of a claim or judgment against an employee of the corporation for punitive or exemplary damages. (d) (1) Any insurance pool established pursuant to this section shall have initial pooled resources of not less than two hundred fifty thousand dollars ($250,000). (2) Any insurance pool providing the coverage described in paragraph (5) of subdivision (a) shall do all of the following: (A) Be organized for the purpose of providing the coverage described in paragraph (1) of subdivision (a) for a period of no less than five years. (B) Have accumulated net assets of not less than five million dollars ($5,000,000). (e) All participating corporations in any pool established pursuant to this section are required to agree to pay premiums or make other mandatory financial contributions or commitments necessary to ensure a financially sound risk pool. (f) For the purpose of this section, an authorized “corporation” means any corporation that meets all of the following criteria: (1) Is organized chiefly to provide or fund health or human services, but does not include a hospital. (2) Is exempt from federal income taxation as an organization described in Section 501(c)(3) of the United States Internal Revenue Code.

Cal. Corporations Code - CORP § 5006. Section 5006.

The fees of the Secretary of State for filing instruments by or on behalf of corporations are prescribed in Article 3 (commencing with Section 12180) of Chapter 3 of Part 2 of Division 3 of Title 2 of the Government Code.

Cal. Corporations Code - CORP § 5007. Section 5007.

Any agreement, certificate or other instrument relating to a domestic corporation, a foreign corporation, or a foreign business corporation filed pursuant to the provisions of this part, Part 2, Part 3, Part 4 or Part 5 may be corrected with respect to any misstatement of fact contained therein, any defect in the execution thereof or any other error or defect contained therein, by filing a certificate of correction entitled “Certificate of Correction of _____ (insert here the title of the agreement, certificate or other instrument to be corrected and name(s) of the corporation or corporations)”; provided, however, that no such certificate of correction shall alter the wording of any resolution which was in fact adopted by the board or the members or delegates or effect a corrected amendment of articles which amendment as so corrected would not in all respects have complied with the requirements of this part, Part 2, Part 3, Part 4 or Part 5 at the time of filing of the agreement, certificate or other instrument being corrected. Such certificate of correction shall be signed and verified or acknowledged as provided in this part with respect to the agreement, certificate or other instrument being corrected. It shall set forth the following: (a) The name or names of the corporation or corporations. (b) The date the agreement, certificate or other instrument being corrected was filed. (c) The provision in the agreement, certificate or other instrument as corrected and, if the execution was defective, wherein it was defective. The filing of the certificate of correction shall not alter the effective time of the agreement, certificate or instrument being corrected, which shall remain as its original effective time, and such filing shall not affect any right or liability accrued or incurred before such filing, except that any right or liability accrued or incurred by reason of the error or defect being corrected shall be extinguished by such filing if the person having such right has not detrimentally relied on the original instrument.

Cal. Corporations Code - CORP § 5008. Section 5008.

(a) Upon receipt of any instrument by the Secretary of State for filing pursuant to this part, Part 2, Part 3, Part 4, or Part 5, if it conforms to law, it shall be filed by, and in the office of the Secretary of State and the date of filing endorsed thereon. Except for instruments filed pursuant to Section 6210, 8210, or 9660 the date of filing shall be the date the instrument is received by the Secretary of State unless the instrument provides that it is to be withheld from filing until a future date, other than instruments filed pursuant to Section 5017, or, unless in the judgment of the Secretary of State, the filing is intended to be coordinated with the filing of some other corporate document which cannot be filed. The Secretary of State shall file a document as of any requested future date not more than 90 days after its receipt, including a Saturday, Sunday, or legal holiday, if the document is received in the Secretary of State’s office at least one business day prior to the requested date of filing. An instrument does not fail to conform to law because it is not accompanied by the full filing fee if the unpaid portion of the fee does not exceed the limits established by the policy of the Secretary of State for extending credit in these cases. (b) If the Secretary of State determines that an instrument submitted for filing or otherwise submitted does not conform to law and returns it to the person submitting it, the instrument may be resubmitted accompanied by a written opinion of the member of the State Bar of California submitting the instrument, or representing the person submitting it, to the effect that the specific provision of the instrument objected to by the Secretary of State does conform to law and stating the points and authorities upon which the opinion is based. The Secretary of State shall rely, with respect to any disputed point of law, other than the application of Section 5122, 7122, or 9122, upon that written opinion in determining whether the instrument conforms to law. The date of filing in that case shall be the date the instrument is received on resubmission. (c) Any instrument filed with respect to a corporation, other than original articles or instruments filed pursuant to Section 5017, may provide that it is to become effective not more than 90 days subsequent to its filing date. In case such a delayed effective date is specified, the instrument may be prevented from becoming effective by a certificate stating that by appropriate corporate action it has been revoked and is null and void, executed in the same manner as the original instrument and filed before the specified effective date. In the case of a merger agreement, the certificate revoking the earlier filing need only be executed on behalf of one of the constituent corporations. If no revocation certificate is filed, the instrument becomes effective on the date specified. (d) Any instrument submitted to the Secretary of State for filing pursuant to this part, Part 2, Part 3, Part 4, or Part 5 by a domestic corporation or foreign corporation that is qualified to transact business in California under Section 2105 shall include the entity name and number as they exist on the Secretary of State’s records.

Cal. Corporations Code - CORP § 5008.5. Section 5008.5.

The Secretary of State may cancel the filing of articles if a check or other remittance accepted in payment of the filing fee or franchise tax is not paid upon presentation. Within 90 days of receiving written notification that the item presented for payment has not been honored for payment, the Secretary of State shall give written notice of the applicability of this section and the cancellation date, which shall be not less than 20 days from the date of mailing the written notice as certified by the Secretary of State, to the agent for service of process or to the person submitting the instrument. Thereafter, if the amount has not been paid by cashier’s check or equivalent before the date of cancellation as stated in the written notice of cancellation, the cancellation shall thereupon be effective.

Cal. Corporations Code - CORP § 5008.6. Section 5008.6.

(a) A corporation that (1) fails to file a statement pursuant to Section 6210, 8210, or 9660 for an applicable filing period, (2) has not filed a statement pursuant to Section 6210, 8210, or 9660 during the preceding 24 months, and (3) was certified for penalty pursuant to Section 6810, 8810, or 9690 for the same filing period, shall be subject to suspension pursuant to this section rather than to penalty under Section 6810 or 8810. (b) When subdivision (a) is applicable, the Secretary of State shall provide a notice to the corporation informing the corporation that its corporate powers, rights, and privileges will be suspended 60 days from the date of the notice if the corporation does not file the statement required by Section 6210, 8210, or 9660. (c) If the 60-day period expires without the delinquent corporation filing the required statement, the Secretary of State shall notify the Franchise Tax Board of the suspension, and provide a notice of the suspension to the corporation. Thereupon, except for the purpose of filing an application for exempt status or amending the articles of incorporation as necessary either to perfect that application or to set forth a new name, the corporate powers, rights, and privileges of the corporation are suspended. (d) A statement required by Section 6210, 8210, or 9660 may be filed, notwithstanding suspension of the corporate powers, rights, and privileges under this section or under provisions of the Revenue and Taxation Code. Upon the filing of a statement under Section 6210, 8210, or 9660, by a corporation that has suffered suspension under this section, the Secretary of State shall certify that fact to the Franchise Tax Board and the corporation may thereupon be relieved from suspension, unless the corporation is held in suspension by the Franchise Tax Board because of Section 23301, 23301.5, or 23775 of the Revenue and Taxation Code.

Cal. Corporations Code - CORP § 5008.9. Section 5008.9.

(a) A nonprofit corporation described in Section 5059, 5060, or 5061, or a foreign nonprofit corporation, as defined in Section 5053, that has qualified to transact intrastate business, shall be subject to administrative dissolution or administrative surrender in accordance with this section if, as of January 1, 2016, or later, the nonprofit corporation’s or foreign corporation’s corporate powers are, and have been, suspended or forfeited by the Franchise Tax Board for a period of not less than 48 continuous months. (b) Prior to the administrative dissolution or administrative surrender of the nonprofit corporation or foreign corporation, the corporation shall be notified of the pending administrative dissolution or administrative surrender as follows: (1) The Franchise Tax Board shall mail written notice to the last known address of a nonprofit corporation or foreign corporation meeting the requirement described in subdivision (a). (2) If the nonprofit corporation or foreign corporation does not have a valid address in the records of the Franchise Tax Board, the notice provided in subdivision (d) shall be deemed sufficient notice prior to administrative dissolution or administrative surrender. (c) The Franchise Tax Board shall transmit to the Secretary of State and the Attorney General’s Registry of Charities and Fundraisers the names and Secretary of State file numbers of nonprofit corporations and foreign corporations subject to the administrative dissolution or administrative surrender provisions of this section. (d) The Secretary of State shall provide 60 calendar days’ notice of the pending administrative dissolution or administrative surrender on its internet website by listing the corporation name and the Secretary of State’s file number for the nonprofit corporation or foreign corporation. The Secretary of State shall also, in conjunction with the information above, provide instructions for a nonprofit corporation or foreign corporation to submit a written objection of the pending administrative dissolution or administrative surrender to the Franchise Tax Board. (e) (1) A nonprofit corporation or foreign corporation may provide the Franchise Tax Board with a written objection to the administrative dissolution or administrative surrender. (2) The Franchise Tax Board shall notify the Secretary of State if a written objection has been received. (f) If no written objection to the administrative dissolution or administrative surrender is received by the Franchise Tax Board during the 60-day period described in subdivision (d), the nonprofit corporation or foreign corporation shall be administratively dissolved or administratively surrendered in accordance with this section. The certificate of the Secretary of State shall be prima facie evidence of the administrative dissolution or administrative surrender. (g) (1) If the written objection of a nonprofit corporation or foreign corporation to the administrative dissolution or administrative surrender has been received by the Franchise Tax Board before the expiration of the 60-day period described in subdivision (d), that nonprofit corporation or foreign corporation shall have an additional 90 days from the date the written objection is received by the Franchise Tax Board to pay or otherwise satisfy all accrued taxes, penalties, and interest and to file a current Statement of Information with the Secretary of State. (2) (A) If the conditions in paragraph (1) are satisfied, the administrative dissolution or administrative surrender shall be canceled. (B) If the conditions in paragraph (1) are not satisfied, the nonprofit corporation or foreign corporation shall be administratively dissolved or administratively surrendered in accordance with this section as of the date that is 90 days after the receipt of the written objection. (3) The Franchise Tax Board may extend the 90-day period in paragraph (1), but for no more than one period of 90 days. (h) Upon administrative dissolution or administrative surrender in accordance with this section, the nonprofit corporation’s or the foreign corporation’s liabilities for qualified taxes, interest, and penalties as defined in Section 23156 of the Revenue and Taxation Code, if any, shall be abated. Any actions taken by the Franchise Tax Board to collect that abated liability shall be released, withdrawn, or otherwise terminated by the Franchise Tax Board, and no subsequent administrative or civil action shall be taken or brought to collect all or part of that amount. Any amounts erroneously received by the Franchise Tax Board in contravention of this section may be credited and refunded in accordance with Article 1 (commencing with Section 19301) of Chapter 6 of Part 10.2 of Division 2 of the Revenue and Taxation Code. (i) If the nonprofit corporation or foreign corporation is administratively dissolved or administratively surrendered under this section, the liability to creditors, if any, is not discharged. The liability of the directors of, or other persons related to, the administratively dissolved or administratively surrendered nonprofit corporation or foreign corporation is not discharged. The administrative dissolution or administrative surrender of a nonprofit corporation or foreign corporation pursuant to this section shall not diminish or adversely affect the ability of the Attorney General to enforce liabilities as otherwise provided by law.

Cal. Corporations Code - CORP § 5009. Section 5009.

Except as otherwise required, any reference in this part, Part 2, Part 3, Part 4 or Part 5 to mailing means first-, second-, or third-class mail, postage prepaid, unless registered mail is specified. Registered mail includes certified mail.

Cal. Corporations Code - CORP § 5010. Section 5010.

If the articles or bylaws provide for more or less than one vote for any membership on any matter, the references in Sections 5033 and 5034 to a majority or other proportion of memberships mean, as to those matters, a majority or other proportion of the votes entitled to be cast. Whenever in Part 2 (commencing with Section 5110) or Part 3 (commencing with Section 7110) members are disqualified from voting on any matter, their memberships shall not be counted for the determination of a quorum at any meeting to act upon, or the required vote to approve action upon, that matter under any other provision of Part 2 (commencing with Section 5110) or Part 3 (commencing with Section 7110) or the articles or bylaws.

Cal. Corporations Code - CORP § 5011. Section 5011.

All references in Part 3 (commencing with Section 7110) to the voting of memberships include the voting of securities given voting rights in the articles pursuant to paragraph (3) of subdivision (a) of Section 7132.

Cal. Corporations Code - CORP § 5012. Section 5012.

All references in this part, Part 2 (commencing with Section 5110), Part 3 (commencing with Section 7110), or Part 4 (commencing with Section 9110) to financial statements of a corporation mean statements prepared in conformity with generally accepted accounting principles or some other basis of accounting which reasonably sets forth the assets and liabilities and the income and expenses of the corporation and discloses the accounting basis used in their preparation.

Cal. Corporations Code - CORP § 5013. Section 5013.

As used in this part, Part 2 (commencing with Section 5110), Part 3 (commencing with Section 7110), or Part 4 (commencing with Section 9110), “independent accountant” means a certified public accountant or public accountant who is independent of the corporation, as determined in accordance with generally accepted auditing standards, and who is engaged to audit financial statements of the corporation or perform other accounting services.

Cal. Corporations Code - CORP § 5014. Section 5014.

Any requirement in Part 3 (commencing with Section 7110) for a vote of each class of members means such a vote regardless of limitations or restrictions upon the voting rights thereof, unless expressly limited to voting memberships.

Cal. Corporations Code - CORP § 5015. Section 5015.

Any reference in this part, Part 2 (commencing with Section 5110), Part 3 (commencing with Section 7110), Part 4 (commencing with Section 9110), or Part 5 (commencing with Section 9910) to the time a notice is given or sent means, unless otherwise expressly provided, (a) the time a written notice by mail is deposited in the United States mails, postage prepaid; or (b) the time any other written notice, including facsimile, telegram, or other electronic mail message, is personally delivered to the recipient or is delivered to a common carrier for transmission, or actually transmitted by the person giving the notice by electronic means, to the recipient; or (c) the time any oral notice is communicated, in person or by telephone, including a voice messaging system or other system or technology designed to record and communicate messages, or wireless, to the recipient, including the recipient’s designated voice mailbox or address on such a system, or to a person at the office of the recipient who the person giving the notice has reason to believe will promptly communicate it to the recipient.

Cal. Corporations Code - CORP § 5016. Section 5016.

A notice or report mailed or delivered as part of a newsletter, magazine or other organ regularly sent to members shall constitute written notice or report pursuant to this division when addressed and mailed or delivered to the member, or in the case of members who are residents of the same household and who have the same address on the books of the corporation, when addressed and mailed or delivered to one of such members, at the address appearing on the books of the corporation.

Cal. Corporations Code - CORP § 5017. Section 5017.

(a) (1) Otherwise lawful corporate actions not in compliance, or purportedly not in compliance, with this division or the articles, bylaws, or a plan or agreement to which the corporation is a party in effect at the time of the corporate action, may be ratified, or validated by the superior court, in accordance with the provisions of this section. (2) Except as otherwise determined by the superior court pursuant to subdivision (e), a ratification or validation of a corporate action in accordance with this section is conclusive in the absence of fraud. (3) This section does not limit the authority of the board, the members, or the corporation to effect any other lawful means of ratification or validation of a corporate action or correction of a record. (4) No corporate action may be ratified under subdivision (b) by a dissolved corporation or a foreign corporation, and no petition may be filed under subdivision (e) in respect of any corporate action of such a corporation. (5) This section shall not be used to ratify or validate any corporate action in respect of any of the following: (A) Noncompliance with subdivision (a) of Section 5231, 7231, or 9241. (B) Noncompliance with Section 5234, subdivision (a) or (b) of Section 7233, or Section 9244. (C) Noncompliance with Section 5236 or 7235. (D) Transactions covered by Section 5233. (E) Transactions covered by Section 9243. (b) (1) A ratification of a corporate action pursuant to this section, other than a ratification relating to the election of the initial directors pursuant to paragraph (2) of this subdivision, shall be approved by the board and, as applicable, approved by the members in accordance with any provision set forth in this division or the articles, bylaws, or a plan or agreement to which the corporation is a party that is applicable to the type of corporate action proposed to be ratified and in effect at the time of the ratification, unless there are no members entitled to vote on the ratification at the time of the ratification, in which case the ratification shall be approved solely by the board, or a higher approval standard that was or would have been applicable to the original taking or purported taking of the corporate action, in which case the ratification shall be approved in accordance with such higher approval standard. In order to approve a ratification of a corporate action pursuant to this paragraph, the board and, as applicable, the members shall adopt resolutions setting forth all of the following: (A) Each corporate action to be ratified. (B) The date when each such corporate action was purportedly taken, and the date any such corporate action shall be deemed to have become effective pursuant to this section if different than the date the corporate action was purportedly taken. (C) The nature of the noncompliance or purported noncompliance of each such corporate action. (D) A statement that the ratification of each such corporate action is approved. (2) If the corporate action to be ratified relates to the election of the initial directors pursuant to Section 5134, 7134, or 9134, a majority of the persons who, at the time of the ratification, are exercising the powers of directors may approve that ratification by adopting resolutions setting forth all of the following: (A) The name of the person or persons who first took action in the name of the corporation as the initial directors of the corporation. (B) The earlier of the date on which such persons first took such action or were purported to have been elected as the initial directors, and the date on which such person or persons shall be deemed to have become the initial directors of the corporation pursuant to this section if different than the date of such first action or purported election, as applicable. (C) That the ratification of the election of such person or persons as the initial directors is approved. (c) Notice of any ratification of a corporate action pursuant to this section shall be given promptly after ratification pursuant to subdivision (b) to each member, regardless of whether approval of the members is required for the ratification. The notice shall be given as provided in subdivision (b) of Section 5511 or 7511 or subdivision (a) of Section 9411, as applicable, and shall include a copy of any resolutions adopted pursuant to subdivision (b) and a copy of this section. (d) (1) If a corporate action ratified pursuant to this section would have required the filing of an instrument with the Secretary of State pursuant to the provisions of this division, or if such ratification would cause any instrument previously filed with the Secretary of State to be inaccurate or incomplete in any material respect after giving effect to the ratification, the corporation shall file a certificate of ratification to make, amend, or correct each such instrument. The certificate of ratification shall have the effect as specified therein, and shall be filed with the Secretary of State. A certificate of ratification shall consist of an officers’ certificate setting forth all of the following: (A) The name of the corporation and the Secretary of State’s file number of the corporation. (B) The title of any such instrument whose making, amendment, or correction is being effected by the certificate of ratification. (C) The date any such instrument was filed with the Secretary of State, or a statement that any such instrument was not previously filed with the Secretary of State and, as applicable, a statement that the ratification approved pursuant to the resolutions set forth in the certificate of ratification would cause any such instrument to be inaccurate or incomplete in any material respect after giving effect to the ratification. (D) The date any such instrument shall be deemed to have become effective pursuant to this section, which may be prior to or after the filing date. (E) A statement that the certificate of ratification is making, amending, or correcting any such instrument, as applicable, and a copy of any such instrument containing all of the information required to be included under this division for such instrument to be so made, amended, or corrected. An instrument attached to a certificate of ratification pursuant to this subparagraph need not be separately executed and acknowledged and need not include any statement required by any other section of this division that such instrument has been approved and adopted in accordance with the provisions of such other section. (F) A statement that the ratification has been approved pursuant to subdivision (b), a copy of the resolutions adopted pursuant to subdivision (b) in respect of the ratification. (2) The office of the Secretary of State may, in its discretion, refuse to file any certificate of ratification if the instrument would render prior filings with the Secretary of State inaccurate, ambiguous, or unintelligible. Upon refusal of the Secretary of State to file a certificate of ratification pursuant to this subdivision, the corporation shall seek validation pursuant to subdivision (e). (e) (1) Upon the filing of a petition by an authorized person, the superior court of the proper county shall have jurisdiction in equity to determine the validity of any corporate action (whether or not such corporate action is a ratification or has been the subject of any ratification), validate and declare effective any such corporate action, and declare the date any such corporate action shall be deemed to have become effective or valid, as applicable, pursuant to this section. (2) This section does not prescribe or circumscribe the facts and circumstances the superior court may consider or which remedies the superior court may grant in exercising its jurisdiction under this section, except as described in this subdivision. The superior court may make any order concerning the corporate action as justice and equity may require. (3) Any petition relating to a ratification taken or proposed to be taken pursuant to this section shall be filed not later than 180 days after the notice required by subdivision (c) is given, except this paragraph shall not apply to an action asserting that a ratification was not accomplished in accordance with this section or to any person to whom notice of the ratification was required to have been given pursuant to subdivision (c), but to whom such notice was not given. (4) For purposes of this subdivision, the proper county shall be the county where the principal office of the corporation is located or, if the principal office is not located in this state, in the county in which the corporation’s agent for service of process is located. (5) Service of the petition under paragraph (1) upon the registered agent of the corporation shall be deemed to be service upon the corporation, and no other party need be joined in order for the superior court to adjudicate the matter. The superior court may require notice of the action to be provided to other persons specified by the court and permit those other persons to intervene in the action. (6) For purposes of this subdivision, “authorized person” means the corporation, any successor entity to the corporation, any director, any member, or any other person, so long as the other person claims to be substantially and adversely affected by the ratification of a corporate action pursuant to this section. (7) Any petition seeking validation of a corporate action shall identify every pending legal proceeding of which the petitioner is aware and in which (A) the validity of the corporate action is being directly challenged or (B) the validation of the corporate action would result in the dismissal of the proceeding in whole or in part. If the petitioner becomes aware of any additional such legal proceeding, the petitioner shall amend, or, to the extent required by applicable rules, move for leave to amend, the petition within 10 court days to identify each such proceeding. Identification of a proceeding shall include the venue or forum in which the proceeding was filed, any case number or other unique identifier assigned to the proceeding in that venue or forum, the names of the parties to the proceeding, and the date on which the proceeding was filed. (f) If a corporate action validated by the superior court pursuant to this section would have required the filing of an instrument with the Secretary of State pursuant to the provisions of this division, or if such validation would cause any instrument previously filed with the Secretary of State to be inaccurate or incomplete in any material respect after giving effect to the validation, the corporation shall file a certificate of validation to make, amend, or correct each such instrument. The certificate of validation shall have the effect as specified therein, and shall be filed with the Secretary of State. A certificate of validation shall consist of an officers’ certificate setting forth all of the following: (1) The name of the corporation and the Secretary of State’s file number of the corporation. (2) The title of any such instrument whose making, amendment, or correction is being effected by the certificate of validation. (3) The date any such instrument was filed with the Secretary of State, or a statement that any such instrument was not previously filed with the Secretary of State and, as applicable, a statement that the validation ordered pursuant to the superior court order set forth in the certificate of validation would cause any such instrument to be inaccurate or incomplete in any material respect after giving effect to the validation. (4) The date any such instrument shall be deemed to have become effective pursuant to this section, which may be prior to or after the filing date. (5) A statement that the certificate of validation is making, amending, or correcting any such instrument, as applicable, and a copy of any such instrument containing all of the information required to be included under this division for such instrument to be so made, amended, or corrected. An instrument attached to a certificate of validation pursuant to this paragraph need not be separately executed and acknowledged and need not include any statement required by any other section of this division that such instrument has been approved and adopted in accordance with the provisions of such other section. (6) A statement that the validation has been ordered pursuant to subdivision (e), and a copy of the superior court order issued pursuant to subdivision (e) in respect of such validation. (g) Unless otherwise stated in resolutions adopted pursuant to subdivision (b) or determined by the superior court pursuant to subdivision (e), a corporate action or security of the corporation ratified or validated in accordance with this section relates back to the date of the original corporate action. (h) As used in this section: (1) “Corporate action” means any of the following: (A) Any action or purported action of the board. (B) Any action or purported action of the members. (C) Any other action or transaction taken, or purportedly taken, by or on behalf of the corporation. (2) “Higher approval standard” means any provision set forth in this division or the articles, bylaws, or a plan or agreement to which the corporation was a party in effect at the time of the original taking or purported taking of a corporate action: (A) Requiring action of the board or members, at a meeting or by written consent, to be taken by a proportion greater than would have been required pursuant to this division or the articles, bylaws, or a plan or agreement to which the corporation is a party in effect at the time of the ratification of the corporate action pursuant to this section. (B) Requiring a greater proportion of the directors or members to constitute a quorum for the transaction of business at a meeting than would have been required pursuant to this division or the articles, bylaws, or a plan or agreement to which the corporation is a party in effect at the time of the ratification of the corporate action pursuant to this section. (C) Requiring, prohibiting, or prescribing conditions on action of the board or members at a meeting or by written consent, which would not have been required, prohibited, or prescribed pursuant to this division or the articles, bylaws, or a plan or agreement to which the corporation is a party in effect at the time of the ratification of the corporate action pursuant to this section. (D) Requiring separate action of any specified person or persons, which would not have been required pursuant to this division or the articles, bylaws, or a plan or agreement to which the corporation is a party in effect at the time of the ratification of the corporate action pursuant to this section. (i) The corporation shall retain all records related to the ratification or validation of a corporate action under this section in accordance with Section 6320, 8320, or 9510. (j) If the corporation is a party to a pending legal proceeding in which (1) the validity of a corporate action sought to be ratified or validated pursuant to this section is at issue or (2) the ratification or validation of a corporate action pursuant to this section would result in the dismissal in whole or in part of the proceeding, the corporation shall notify the judge, arbitrator, or other person presiding over the proceeding at least 10 court days prior to adopting resolutions pursuant to subdivision (b) or filing a petition pursuant to subdivision (e) with respect to that corporate action. That person shall have power to stay the ratification or validation as justice and equity may require.

Cal. Corporations Code - CORP § 5030. Section 5030.

“Acknowledged” means that an instrument is either: (a) Formally acknowledged as provided in Article 3 (commencing with Section 1180) of Chapter 4 of Title 4 of Part 4 of Division 2 of the Civil Code; or (b) Accompanied by a declaration in writing signed by the persons executing the same that they are such persons and that the instrument is the act and deed of the person or persons executing the same. Any certificate of acknowledgment taken without this state before a notary public or a judge or clerk of a court of record having an official seal need not be further authenticated.

Cal. Corporations Code - CORP § 5031. Section 5031.

A corporation is an “affiliate” of, or a corporation is “affiliated” with, another specified corporation if it directly, or indirectly through one or more intermediaries, controls, is controlled by or is under common control with the other specified corporation.

Cal. Corporations Code - CORP § 5032. Section 5032.

“Approved by (or approval of) the board” means approved or ratified by the vote of the board or by the vote of a committee authorized to exercise the powers of the board, except as to matters not within the competence of the committee under Section 5212, Section 7212, or Section 9212.

Cal. Corporations Code - CORP § 5033. Section 5033.

“Approval by (or approval of) a majority of all members” means approval by an affirmative vote (or written ballot in conformity with Section 5513, Section 7513, or Section 9413) of a majority of the votes entitled to be cast. Such approval shall include the affirmative vote of a majority of the outstanding memberships of each class, unit, or grouping of members entitled, by any provision of the articles or bylaws or of Part 2, Part 3, Part 4 or Part 5 to vote as a class, unit, or grouping of members on the subject matter being voted upon and shall also include the affirmative vote of such greater proportion, including all, of the votes of the memberships of any class, unit, or grouping of members if such greater proportion is required by the bylaws (subdivision (e) of Section 5151, subdivision (e) of Section 7151, or subdivision (e) of Section 9151) or Part 2, Part 3, Part 4 or Part 5.

Cal. Corporations Code - CORP § 5034. Section 5034.

“Approval by (or approval of) the members” means approved or ratified by the affirmative vote of a majority of the votes represented and voting at a duly held meeting at which a quorum is present (which affirmative votes also constitute a majority of the required quorum) or written ballot in conformity with Section 5513, 7513, or 9413 or by the affirmative vote or written ballot of such greater proportion, including all of the votes of the memberships of any class, unit, or grouping of members as may be provided in the bylaws (subdivision (e) of Section 5151, subdivision (e) of Section 7151, or subdivision (e) of Section 9151) or in Part 2, Part 3, Part 4 or Part 5 for all or any specified member action.

Cal. Corporations Code - CORP § 5035. Section 5035.

“Articles” includes the articles of incorporation, amendments thereto, amended articles, restated articles, and certificates of incorporation.

Cal. Corporations Code - CORP § 5036. Section 5036.

(a) Except as provided in subdivision (b) or (c), “authorized number” means 5 percent of the voting power. (b) Where (disregarding any provision for cumulative voting which would otherwise apply) the total number of votes entitled to be cast for a director is 1,000 or more, but less than 5,000 the authorized number shall be 2 1 2 percent of the voting power, but not less than 50. (c) Where (disregarding any provision for cumulative voting which would otherwise apply) the total number of votes entitled to be cast for a director is 5,000 or more, the authorized number shall be one-twentieth of 1 percent of the voting power, but not less than 125. (d) Any right under Part 2, Part 3, or Part 4 which may be exercised by the authorized number, or some multiple thereof, may be exercised by a member with written authorizations obtained within any 11-month period from members who, in the aggregate, hold the equivalent voting power. Any such authorization shall specify the right to be exercised thereunder and the duration thereof (which shall not exceed three years). (e) Where any provision of Part 2, Part 3, or Part 4 specifies twice the authorized number, that means two times the number calculated according to subdivision (a), (b) or (c).

Cal. Corporations Code - CORP § 5039.5. Section 5039.5.

All references in this division to “chairperson of the board,” other than in Sections 5213, 7213, and 9213, shall be deemed to refer to all permissible titles for a chair of the board, as permitted by Sections 5213, 7213, and 9213.

Cal. Corporations Code - CORP § 5040. Section 5040.

“Chapter” refers to a chapter of Part 2 (commencing with Section 5110), Part 3 (commencing with Section 7110), or Part 4 (commencing with Section 9110) unless otherwise expressly stated.

Cal. Corporations Code - CORP § 5041. Section 5041.

“Class” refers to those memberships which: (a) are identified in the articles or bylaws as being a different type of membership; or (b) have the same rights with respect to voting, dissolution, redemption and transfer. For the purpose of this section, rights shall be considered the same if they are determined by a formula applied uniformly.

Cal. Corporations Code - CORP § 5043. Section 5043.

“Common shares,” as used in Part 3 (commencing with Section 7110), means shares which have no preference over any other shares with respect to distribution of assets on liquidation or with respect to payment of dividends.

Cal. Corporations Code - CORP § 5044. Section 5044.

“Constituent corporation” means a corporation which is merged with one or more other corporations and includes the surviving corporation.

Cal. Corporations Code - CORP § 5045. Section 5045.

“Control” means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a corporation.

Cal. Corporations Code - CORP § 5046. Section 5046.

(a) “Corporation” as used in this part and Part 5 (commencing with Section 9910), refers to corporations defined in subdivisions (b), (c), and (d). (b) “Corporation,” as used in Part 2 (commencing with Section 5110), means a nonprofit public benefit corporation as defined in Section 5060. (c) “Corporation,” as used in Part 3 (commencing with Section 7110) means a nonprofit mutual benefit corporation as defined in Section 5059. (d) “Corporation,” as used in Part 4 (commencing with Section 9110), including those provisions of Part 2 (commencing with Section 5110) made applicable pursuant to Chapter 6 (commencing with Section 9610) of Part 4, means a nonprofit religious corporation as defined in Section 5061.

Cal. Corporations Code - CORP § 5047. Section 5047.

Except as otherwise expressly provided, “directors” means natural persons, designated in the articles or bylaws or elected by the incorporators, and their successors and natural persons designated, elected, or appointed by any other name or title to act as members of the governing body of the corporation. If the articles or bylaws designate that a natural person is a director or a member of the governing body of the corporation by reason of occupying a specified position within the corporation or outside the corporation, without limiting that person’s right to vote as a member of the governing body, that person shall be a director for all purposes and shall have the same rights and obligations, including voting rights, as the other directors. A person who does not have authority to vote as a member of the governing body of the corporation, is not a director as that term is used in this division regardless of title.

Cal. Corporations Code - CORP § 5047.5. Section 5047.5.

(a) The Legislature finds and declares that the services of directors and officers of nonprofit corporations who serve without compensation are critical to the efficient conduct and management of the public service and charitable affairs of the people of California. The willingness of volunteers to offer their services has been deterred by a perception that their personal assets are at risk for these activities. The unavailability and unaffordability of appropriate liability insurance makes it difficult for these corporations to protect the personal assets of their volunteer decisionmakers with adequate insurance. It is the public policy of this state to provide incentive and protection to the individuals who perform these important functions. (b) Except as provided in this section, no cause of action for monetary damages shall arise against any person serving without compensation as a director or officer of a nonprofit corporation subject to Part 2 (commencing with Section 5110), Part 3 (commencing with Section 7110), or Part 4 (commencing with Section 9110) of this division on account of any negligent act or omission occurring (1) within the scope of that person’s duties as a director acting as a board member, or within the scope of that person’s duties as an officer acting in an official capacity; (2) in good faith; (3) in a manner that the person believes to be in the best interest of the corporation; and (4) is in the exercise of his or her policymaking judgment. (c) This section shall not limit the liability of a director or officer for any of the following: (1) Self-dealing transactions, as described in Sections 5233 and 9243. (2) Conflicts of interest, as described in Section 7233. (3) Actions described in Sections 5237, 7236, and 9245. (4) In the case of a charitable trust, an action or proceeding against a trustee brought by a beneficiary of that trust. (5) Any action or proceeding brought by the Attorney General. (6) Intentional, wanton, or reckless acts, gross negligence, or an action based on fraud, oppression, or malice. (7) Any action brought under Chapter 2 (commencing with Section 16700) of Part 2 of Division 7 of the Business and Professions Code. (d) This section only applies to nonprofit corporations organized to provide religious, charitable, literary, educational, scientific, social, or other forms of public service that are exempt from federal income taxation under Section 501(c)(3) or 501(c)(6) of the Internal Revenue Code. (e) This section applies only if the nonprofit corporation maintains a liability insurance policy with an amount of coverage of at least the following amounts: (1) If the corporation’s annual budget is less than fifty thousand dollars ($50,000), the minimum required amount is five hundred thousand dollars ($500,000). (2) If the corporation’s annual budget equals or exceeds fifty thousand dollars ($50,000), the minimum required amount is one million dollars ($1,000,000). This section applies only if the claim against the director or officer can also be made directly against the corporation and a liability insurance policy is applicable to the claim. If that policy is found to cover the damages caused by the director or officer, no cause of action as provided in this section shall be maintained against the director or officer. (f) For the purposes of this section, the payment of actual expenses incurred in attending meetings or otherwise in the execution of the duties of a director or officer shall not constitute compensation. (g) Nothing in this section shall be construed to limit the liability of a nonprofit corporation for any negligent act or omission of a director, officer, employee, agent, or servant occurring within the scope of his or her duties. (h) This section does not apply to any corporation that unlawfully restricts membership, services, or benefits conferred on the basis of political affiliation, age, or any characteristic listed or defined in subdivision (b) or (e) of Section 51 of the Civil Code. (i) This section does not apply to any volunteer director or officer who receives compensation from the corporation in any other capacity, including, but not limited to, as an employee.

Cal. Corporations Code - CORP § 5049. Section 5049.

“Distribution” means the distribution of any gains, profits or dividends to any member as such. As used in this section, “member” means any person who is a member as defined in Section 5056 and any person who is referred to as a member as authorized by subdivision (a) of Sections 5332, 7333 and 9332.

Cal. Corporations Code - CORP § 5052. Section 5052.

“Foreign business corporation,” as used in Part 3 (commencing with Section 7110), means a foreign corporation as defined in Section 171 except that it does not include a foreign corporation as defined in Section 5053.

Cal. Corporations Code - CORP § 5053. Section 5053.

“Foreign corporation” means any corporation incorporated in a jurisdiction other than California pursuant to that jurisdiction’s law for the incorporation of nonprofit corporations; except that as used in subdivision (b) of Section 5122, in subdivision (c) of Section 7122, and in subdivision (b) of Section 9122, “foreign corporation” means a corporation described in Section 171.

Cal. Corporations Code - CORP § 5054. Section 5054.

“Incentive and benefit plans,” as used in Section 5140, in Section 7140, and in Section 9140 includes, but is not limited to, any plan or agreement under which the compensation of officers or employees is fixed, in full or in part, by reference to the financial performance of the corporation.

Cal. Corporations Code - CORP § 5055. Section 5055.

“Liquidating price” or “liquidation preference,” as used in Part 3 (commencing with Section 7110), means amounts payable on memberships of any class, upon voluntary or involuntary dissolution, winding up or distribution of the entire assets of the corporation, in priority to amounts payable to members of another class or classes.

Cal. Corporations Code - CORP § 5056. Section 5056.

(a) “Member” means any person who, pursuant to a specific provision of a corporation’s articles or bylaws, has the right to vote for the election of a director or directors or on a disposition of all or substantially all of the assets of a corporation or on a merger or on a dissolution unless the provision granting such right to vote is only effective as a result of paragraph (2) of subdivision (a) of Section 7132. “Member” also means any person who is designated in the articles or bylaws as a member and, pursuant to a specific provision of a corporation’s articles or bylaws, has the right to vote on changes to the articles or bylaws. (b) The articles or bylaws may confer some or all of the rights of a member, set forth in this part and in Parts 2 through 5 of this division, upon any person or persons who do not have any of the voting rights referred to in subdivision (a). (c) Where a member of a corporation is not a natural person, such member may authorize in writing one or more natural persons to vote on its behalf on any or all matters which may require a vote of the members. (d) A person is not a member by virtue of any of the following: (1) Any rights such person has as a delegate. (2) Any rights such person has to designate or select a director or directors. (3) Any rights such person has as a director.

Cal. Corporations Code - CORP § 5058. Section 5058.

“Membership certificate,” as used in Part 3 (commencing with Section 7110), means a document evidencing a transferable property interest in a corporation.

Cal. Corporations Code - CORP § 5059. Section 5059.

“Nonprofit mutual benefit corporation” or “mutual benefit corporation” means a corporation which is organized under Part 3 (commencing with Section 7110), or subject to Part 3 under the provisions of subdivision (a) of Section 5003.

Cal. Corporations Code - CORP § 5060. Section 5060.

“Nonprofit public benefit corporation” or “public benefit corporation” means a corporation which is organized under Part 2 (commencing with Section 5110) or subject to Part 2 under the provisions of subdivision (a) of Section 5003.

Cal. Corporations Code - CORP § 5061. Section 5061.

“Nonprofit religious corporation” or “religious corporation” means a corporation which is organized under Part 4 (commencing with Section 9110) or subject to Part 4 pursuant to subdivision (a) of Section 5003.

Cal. Corporations Code - CORP § 5062. Section 5062.

“Officer’s certificate” means a certificate signed and verified by the chair of the board, the president or any vice president and by the secretary, the chief financial officer, the treasurer or any assistant secretary or assistant treasurer.

Cal. Corporations Code - CORP § 5063. Section 5063.

“On the certificate,” as used in Part 3 (commencing with Section 7110), means that a statement appears on the face of a certificate or on the reverse thereof with a reference thereto on the face.

Cal. Corporations Code - CORP § 5063.5. Section 5063.5.

“Other business entity” means a domestic or foreign limited liability company, limited partnership, general partnership, business trust, real estate investment trust, unincorporated association, or a domestic reciprocal insurer organized after 1974 to provide medical malpractice insurance as set forth in Article 16 (commencing with Section 1550) of Chapter 3 of Part 2 of Division 1 of the Insurance Code. As used herein, “general partnership” means a “partnership” as defined in Section 16101; “business trust” means a business organization formed as a trust; “real estate investment trust” means a “real estate investment trust” as defined in subsection (a) of Section 856 of the Internal Revenue Code of 1986, as amended; and “unincorporated association” has the meaning set forth in Section 18035.

Cal. Corporations Code - CORP § 5064. Section 5064.

A “parent” of a specified corporation is an affiliate controlling such corporation directly or indirectly through one or more intermediaries.

Cal. Corporations Code - CORP § 5064.5. Section 5064.5.

“Parent party” means the corporation in control of any constituent domestic or foreign corporation or other business entity and whose equity securities are issued, transferred, or exchanged in a merger pursuant to Section 6019.1 or 8019.1.

Cal. Corporations Code - CORP § 5065. Section 5065.

“Person,” in addition to those entities specified in Section 18 and unless otherwise expressly provided, includes any association, business corporation, company, corporation, corporation sole, domestic corporation, estate, foreign corporation, foreign business corporation, individual, joint stock company, joint venture, mutual benefit corporation, public benefit corporation, religious corporation, partnership, government or political subdivision, agency or instrumentality of a government.

Cal. Corporations Code - CORP § 5068. Section 5068.

“Proper county” means the county where the corporation’s principal office in this state is located or, if the corporation has no such office, the County of Sacramento.

Cal. Corporations Code - CORP § 5069. Section 5069.

“Proxy” means a written authorization signed by a member or the member’s attorney in fact giving another person or persons power to vote on behalf of such member. “Signed” for the purpose of this section means the placing of the member’s name on the proxy (whether by manual signature, typewriting, telegraphic transmission or otherwise) by the member or such member’s attorney in fact.

Cal. Corporations Code - CORP § 5072. Section 5072.

“Shares,” as used in Part 3 (commencing with Section 7110), means the units into which the proprietary interests in a business corporation or foreign business corporation are divided in the articles.

Cal. Corporations Code - CORP § 5073. Section 5073.

(a) Except as provided in subdivision (b), “subsidiary” of a specified corporation means a corporation more than 50 percent of the voting power of which is owned directly, or indirectly through one or more subsidiaries, by the specified corporation. (b) For the purpose of Section 7315, “subsidiary” of a specified corporation means a corporation more than 25 percent of the voting power of which is owned directly, or indirectly through one or more subsidiaries as defined in subdivision (a), by the specified corporation.

Cal. Corporations Code - CORP § 5075. Section 5075.

“Vacancy” when used with respect to the board means any authorized position of director which is not then filled, whether the vacancy is caused by death, resignation, removal, change in the number of directors authorized in the articles or bylaws (by the board or the members) or otherwise.

Cal. Corporations Code - CORP § 5076. Section 5076.

“Verified” means that the statements contained in a certificate or other document are declared to be true of the own knowledge of the persons executing the same in either: (a) An affidavit signed by them under oath before an officer authorized by the laws of this state or of the place where it is executed to administer oaths; or (b) A declaration in writing executed by them under penalty of perjury and stating the date and place (whether within or without this state) of execution. Any affidavit sworn to without this state before a notary public or a judge or clerk of a court of record having an official seal need not be further authenticated.

Cal. Corporations Code - CORP § 5077. Section 5077.

“Vote” includes, but is not limited to, authorization by written consent pursuant to subdivision (b) of Section 5211, subdivision (b) of Section 7211, or subdivision (b) of Section 9211 and authorization by written ballot pursuant to Section 5513, Section 7513, or Section 9413.

Cal. Corporations Code - CORP § 5078. Section 5078.

“Voting power” means the power to vote for the election of directors at the time any determination of voting power is made and does not include the right to vote upon the happening of some condition or event which has not yet occurred. In any case where different classes of memberships are entitled to vote as separate classes for different members of the board, the determination of percentage of voting power shall be made on the basis of the percentage of the total number of authorized directors which the memberships in question (whether of one or more classes) have the power to elect in an election at which all memberships then entitled to vote for the election of any directors are voted.

Cal. Corporations Code - CORP § 5079. Section 5079.

“Written” or “in writing” includes facsimile, telegraphic, and other electronic communication as authorized by this code, including an electronic transmission by a corporation that satisfies the requirements of Section 20.
Source: CA Legislative Counsel Bulk DataURL: https://downloads.leginfo.legislature.ca.gov/pubinfo_2025.zipFetched: 6/27/2026

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