December 3, 2021

Volume XI, Number 337

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December 03, 2021

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December 02, 2021

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December 01, 2021

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PEO Versus PPB

California's female and underrepresented community board quota statutes apply to publicly held corporations having their principal executive offices in California "according to the corporation's SEC 10-K form".  Cal. Corp. Code §§ 301.3(a) & 301.4(a).  These requirements have caused many publicly traded corporations to take a look at the location of their principal executive office.   The location of a corporation's principal executive office has significance beyond board quota requirements.  

 Numerous provisions of the GCL establish venue based on the location of the corporation's PEO, including the following:

  • Section 305(c) (order for a special meeting of shareholders to elect entire board);

  • Section 308(a) (appointment of a provisional director);

  • Section 419(b) (order requiring issuance of replacement certificate);

  • Section 601(c) (order giving notice of special meeting of shareholders);

  • Section 709(a) (determination of validity of election);

  • Section 1304(a) (dissenting shares);

  • Section 1501(e) (enforcement of obligation to furnish reports); and

  • Section 1800(a) (complaint for involuntary dissolution).

Each of these statutes refers to the "proper county" which is defined in Section 177 as "the county where the principal executive office of the corporation is located or, if the principal executive office of the corporation is not located in this state, or the corporation has no such office, the County of Sacramento".

At yesterday's webinar, I was asked about the difference between a corporation's "principal executive office" and "principal place of business".   The GCL does make an occasional reference to a corporation's PPB.  For example, Section 1152(g) requires a converted entity that is domestic partnership to keep the plan of conversion at its PBB.   A similar requirement can be found in Section 1113(g)(2)(F) with respect to mergers.   

In addition to these references to the "principal place of business", the GCL has a few references to a corporation's "principal business office".  See, e.g., Cal. Corp. Code §§ 213, 1502 and 2117.

The annual statement filed by California corporations and foreign corporations transacting intrastate business in California (Form SI-550) requires disclosure of the street address of the PEO.  The statement requires disclosure of the street address, if any, of the corporation's  "principal office in California" if the PEO is not located in California.  

© 2010-2021 Allen Matkins Leck Gamble Mallory & Natsis LLP National Law Review, Volume XI, Number 300
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About this Author

Keith Paul Bishop, Corporate Transactions Lawyer, finance securities attorney, Allen Matkins Law Firm
Partner

Keith Bishop works with privately held and publicly traded companies on federal and state corporate and securities transactions, compliance, and governance matters. He is highly-regarded for his in-depth knowledge of the distinctive corporate and regulatory requirements faced by corporations in the state of California.

While many law firms have a great deal of expertise in federal or Delaware corporate law, Keith’s specific focus on California corporate and securities law is uncommon. A former California state regulator of securities and financial institutions, Keith has decades of...

949-851-5428
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