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CALIFORNIA CORPORATE & SECURITIES LAW

In California, Directors Who Abstain May Still Face Liability

Section 316(a) of the California Corporations Code imposes joint and several liability on directors who approve any of the following actions: The making of any distribution to shareholders to the extent contrary Sections 500 – 503; The distribution of assets to shareholders after institution of dissolution proceedings of the corporation, without paying or adequately providing…

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Why You Should Have Read Last Week’s Posts On California’s D&O Loan Ban

I spent the better part of last week writing about California Corporations Code Section 315.  The statute general prohibits a corporation (Section 162) from making a loan of money or property to, or guaranteeing the obligation of, an officer or director without specified shareholder approval.  What happens if a prohibited loan is made? The good…

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Why Politicians Should Read The Corporations Code (Or At Least This Blog)

Last September, I wrote about California’s unincorporated associations law.  In “Thinking About Joining A Club? You May Want To Consider These Corporations Code Provisions First“, I noted that Title 3 of the California Corporations Code addresses a number of issues, including whether a member may be held liable for the obligations of an unincorporated club.  A…

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Crowdfunding – There Will Be Investor Losses

With preternatural sagacity, Yogi Berra once observed that “prediction is very hard, especially about the future”.  Although I whole heartedly concur with Mr. Berra’s assessment of the difficulties that inhere in prognistication, I’ve nonetheless decided to make a prediction.  My prediction is that after President Obama signs the Jumpstart Our Business Startups Act, there will be investor losses.  I feel very safe…

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