BILL NUMBER: AB 2588	CHAPTERED  09/18/06

	CHAPTER  324
	FILED WITH SECRETARY OF STATE  SEPTEMBER 18, 2006
	APPROVED BY GOVERNOR  SEPTEMBER 18, 2006
	PASSED THE SENATE  AUGUST 16, 2006
	PASSED THE ASSEMBLY  MAY 4, 2006

INTRODUCED BY   Assembly Member Sharon Runner

                        FEBRUARY 24, 2006

   An act to add Article 6 (commencing with Section 12260) to Chapter
3 of Part 2 of Division 3 of Title 2 of the Government Code,
relating to the Secretary of State.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 2588, Sharon Runner  Business entities: reinstatement.
   Existing law requires that a business entity file with the
Secretary of State a document, as specified, to effect its
termination.
   This bill would require the Secretary of State to reinstate a
business entity to active status upon a court finding that factual
representations in support of the termination document are materially
false or the submission of the termination document for filing with
the Secretary of State is fraudulent or upon other grounds warranting
reinstatement of the business entity.


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


  SECTION 1.  Article 6 (commencing with Section 12260) is added to
Chapter 3 of Part 2 of Division 3 of Title 2 of the Government Code,
to read:

      Article 6.  Reinstatement of Business Entities

   12260.  For the purposes of this article, "termination document"
means the certificate or other document required by the Corporations
Code that is the last certificate or document filed with the
Secretary of State to effect the final dissolution, surrender, or
cancellation of the business entity.
   12261.  The Secretary of State shall reinstate to active status on
its records, a business entity for which a court finds any of the
following:
   (a) The factual representations by a shareholder, member, partner,
or other person that are required for the termination document are
materially false.
   (b) The submission of the termination document to the Secretary of
State for filing is fraudulent.
   (c) Other grounds exist warranting reinstatement of the business
entity.
   12262.  If the Secretary of State determines that the name of a
business entity that has been ordered by a court to be reinstated
creates a conflict under subdivision (b) of Section 201, subdivision
(b) of Section 5122, subdivision (c) of Section 7122, subdivision (b)
of Section 9122, subdivision (b) of Section 12302, subdivision (c)
of Section 15612, or subdivision (c) of Section 17052 of the
Corporations Code or any related statute, the reinstatement shall be
subject to the business entity filing an amendment to change its name
to eliminate the conflict.
   12263.  Nothing in this article authorizes a court to order that
any records of the Secretary of State be expunged. The Secretary of
State shall file a certified copy of the order of the court
reinstating the business entity with the records of the business
entity, and the reinstatement shall be effective on the date the
Secretary of State files the order. The Secretary of State shall
notify the Franchise Tax Board of the reinstatement of the business
entity.