When A California Corporation Converts To A California Limited Liability Company, What Happens To Its Nevada Business License?
Allen Matkins Blog
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2d ago
NRS 107.028(1)(d) requires that a trustee under a deed of trust be a "domestic or foreign entity which holds a current state business license issued by the Secretary of State pursuant to chapter 76 of NRS".   In Mahban v. Prestige Default Services, LLC, 525 P.3d 835 (Nev. 2023), the trustors (Mahban) sought declaratory relief that the trustee (Prestige) had violated NRS 107.028 because the trustee did not hold a valid Nevada business license when serving as the foreclosure trustee.   Prestige was originally formed as a California corporation, but it later con ..read more
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DFPI Is Victim Of Identity Theft
Allen Matkins Blog
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2d ago
There is certainly no lack of persons actively violating the seventh or eighth commandment (depending upon who is counting).  Last week, the California Department of Financial Protection & Innovation announced that it has learned of persons who are "fraudulently claiming to be from the “Department of Financial Protection and Innovation” and using the same letterhead and logo of the DFPI".  These thieves use the actual name of the DFPI's Chief Information Officer, aka CIO.   According to the DFPI, these scammers are seeking payment through a digital payment application f ..read more
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Why Is The DFPI Requesting Funding To Implement Venture Capital Funding Reporting Mandate?
Allen Matkins Blog
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5d ago
Last year, the California legislature enacted a bill, SB 54 (Skinner), that requires a "a venture capital" company to report annually to the Civil Rights Department on its funding determinations related to companies primarily founded by diverse founding team members.  The bill was enacted notwithstanding its significant flaws, which Governor Gavin Newsom's signing message: However, this bill contains problematic provisions and unrealistic timelines that could present barriers to successful implementation and enforcement.  Within California's large and complex venture capital environ ..read more
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Home Means Nevada For This Corporation, But Its Heart Remains Exclusively With The Delaware Court Of Chancery
Allen Matkins Blog
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1w ago
 In 2019, the Nevada legislature added a provision to the state's corporate law permitting the articles of incorporation or bylaws to require, to the extent not inconsistent with any applicable jurisdictional requirements and the laws of the United States, that any, all or certain "concurrent jurisdiction actions" and "internal actions" be brought solely or exclusively in specified court(s).  NRS 78.046.  In the case of an "internal action", the specified courts must include at least one Nevada court whereas no such requirement is imposed with respect to a "concurrent jurisdicti ..read more
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Governor Seeks $7.9 Million To Implement Venture Capital Company Reporting Law That He Branded As "Problematic"
Allen Matkins Blog
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1w ago
Article 14, Section 12 of the California Constitution requires the Governor to submit a budget to the Legislature by January 10 of each year.  The Constitution further required that the budget be accompanied by a budget bill, which the chairperson of the budget committees of each house of the legislature must introduce "immediately".  The legislature must pass the budget by June 15.    In the interval between the introduction and passing of the budget, various adjustments to revenues and expenditures are made.  The administration communicates these proposed changes by ..read more
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When Must A Proxy Include The "General Nature Of The Matter To Be Voted On"?
Allen Matkins Blog
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1w ago
The California Nonprofit Corporation Law defines a "proxy" as 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".  Cal. Corp. Code § 5069.  The other person(s) referred to in the statute are denominated as a "proxyholder".  Cal. Corp. Code § 5070. The first thing to keep in mind regarding this definition is its use of several other statutorily defined terms - "member", "person", "written" and "vote" .  Cal. Corp. Code §§ 5056, 5065, 5079, & 5077, respectively.   ..read more
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OAL Rejects DFPI Proposed Regulations
Allen Matkins Blog
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1w ago
In March 2023, the California Department of Financial Protection & Innovation proposed to adopt numerous regulations to "implement, interpret, and make specific registration requirements for covered persons under the California Consumer Financial Protection Law; requirements for exemption from registration for licensees under the California Financing Law, California Deferred Deposit Transaction Law, and Student Loan Servicing Act; and the regulation of certain advances under the California Financing Law".  The proposed rules garnered extensive comments and the DFPI responded to those ..read more
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Federal Judge Finds Exception To Exclusivity Of California Dissenters' Rights Remedy To Be "Likely" Even Though The Statute Says Otherwise
Allen Matkins Blog
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2w ago
California Corporations Code Section 1312(a) provides: No shareholder of a corporation who has a right under this chapter [Cal. Corp. Code Chapter 13]  to demand payment of cash for the shares held by the shareholder shall have any right at law or in equity to attack the validity of the reorganization or short-form merger, or to have the reorganization or short-form merger set aside or rescinded, except in an action to test whether the number of shares required to authorize or approve the reorganization have been legally voted in favor thereof; but any holder of shares of a class whose t ..read more
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How The Mandatory Indemnification Statutes Of Nevada And Delaware Differ
Allen Matkins Blog
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2w ago
Both Delaware and Nevada require corporations to indemnify certain persons against expenses (including attorneys' fees) to the extent that they have been successful on the merits or otherwise in defense of any action, suit or proceeding.  See DGCL § 145(c) and NRS 78.751.  There is a key difference between these two statutes.  The difference relates to who must be indemnified.   The Delaware statute refers to directors and officers.  Delaware further narrows the field of persons entitled to mandatory indemnification by providing: For indemnification wit ..read more
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Chamber Of Commerce Highlights Some Differences Between SEC And California Climate Disclosure Mandates
Allen Matkins Blog
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2w ago
Last year, the California legislature enacted two bills, SB 253 and SB 261 that purport to impose burdensome disclosure mandates on businesses.  The legislature did so in spite of obvious constitutional infirmities.  It was no surprise that the laws were promptly challenged  by the U.S. Chamber of Commerce and others.  See As Foretold, California's New Forced Speech Laws Are Being Challenged.  The state responded by seeking dismissal of the lawsuit on the basis of standing.  This was a disingenuous move on the part of the state, since it would only delay the ..read more
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