BILL NUMBER: SB 1472	CHAPTERED  07/12/02

	CHAPTER  173
	FILED WITH SECRETARY OF STATE  JULY 12, 2002
	APPROVED BY GOVERNOR  JULY 11, 2002
	PASSED THE ASSEMBLY  JUNE 28, 2002
	PASSED THE SENATE  MAY 23, 2002
	AMENDED IN SENATE  MAY 20, 2002

INTRODUCED BY   Senator Romero

                        FEBRUARY 19, 2002

   An act to amend Section 710 of the Corporations Code, relating to
corporations.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 1472, Romero.  Corporations.
   Existing law sets forth various requirements applicable to a
corporation with outstanding shares of record held by 100 or more
persons relative to a supermajority vote requirement for an amendment
of the articles of incorporation or a certificate of determination.
A corporation is exempt from these requirements if it meets 4
conditions.
   This bill would delete one of these conditions and make other
related changes.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1.  Section 710 of the Corporations Code is amended to
read:
   710.  (a) This section applies to a corporation with outstanding
shares held of record by 100 or more persons (determined as provided
in Section 605) which files an amendment of articles or certificate
of determination containing a "supermajority vote" provision on or
after January 1, 1989; provided that this section shall not apply to
a corporation which files an amendment of articles or certificate of
determination on or after January 1, 1994, if, at the time of filing,
the corporation has (1) outstanding shares of more than one class or
series of stock; (2) no class of equity securities registered under
Section 12(b) or 12(g) of the Securities Exchange Act of 1934; and
(3) outstanding securities held of record by fewer than 300 persons
determined as provided by Section 605.
   (b) A "supermajority vote" is a requirement set forth in the
articles or in a certificate of determination authorized under any
provision of this division that specified corporate action or actions
be approved by a larger proportion of the outstanding shares than a
majority, or by a larger proportion of the outstanding shares of a
class or series than a majority, but no supermajority vote which is
subject to this section shall require a vote in excess of 662/3
percent of the outstanding shares or 662/3 percent of the outstanding
shares of any class or series of those shares.
   (c) An amendment of the articles or a certificate of determination
that includes a supermajority vote requirement shall be approved by
at least as large a proportion of the outstanding shares (Section
152) as is required pursuant to that amendment or certificate of
determination for the approval of the specified corporate action or
actions.  The supermajority vote requirement shall cease to be
effective two years after the filing of the most recent filing of the
amendment or certificate of determination to adopt or readopt the
supermajority vote requirement.  At any time within one year before
the applicable expiration date, a supermajority vote requirement may
be renewed, and at any time after the expiration date, a
supermajority vote requirement may again be made effective for
another two-year period, by readopting the provision and filing a
certificate of amendment pursuant to, and subject to the limitations
of, this subdivision.  If the provision is not readopted in this
manner, then the particular corporate action or actions previously
subject to the supermajority vote shall thereafter require a vote of
only a majority of either the outstanding shares or the shares of the
specified class or series which had previously been subject to the
supermajority vote provision, whichever the case may be.
   (d) The amendments made to this section by the act amending this
section in the 2001-02 Regular Session shall not affect the rights of
minority shareholders existing under law.