Does a Foreign Corporation Need to be Dissolved in California?
Full Question:
Answer:
The answer will depend on all the facts involved. A certificate of surrender must be filed in California when a registered foreign corporation ceases to do business. The dissolution would occur in Delaware if it was incorporated there. Whether the subsidiary needs to be dissolved will depend on whether it has been incorporated as a separate entity. For legal purposes, a wholly-owned subsidiary is a separate entity. Please see the statutes below to determine applicability.
See also:
http://www.sos.ca.gov/business/llc/forms/llc-3_4-7_4-8.pdf
The following is a CA statute:
2112. (a) Subject to Section 2113, a foreign corporation which has
qualified to transact intrastate business may surrender its right to
engage in that business within this state by filing a certificate of
surrender signed by a corporate officer stating:
(1) The name of the corporation as shown on the records of the
Secretary of State, and the state or place of incorporation or
organization.
(2) That it revokes its designation of agent for service of
process.
(3) That it surrenders its authority to transact intrastate
business.
(4) That it consents that process against it in any action upon
any liability or obligation incurred within this state prior to the
filing of the certificate of withdrawal may be served upon the
Secretary of State.
(5) A post office address to which the Secretary of State may mail
a copy of any process against the corporation that is served upon
the Secretary of State, which address or the name to which the
process should be sent may be changed from time to time by filing a
statement signed by a corporate officer stating the new address or
name or both.
(6) Except in the case of a foreign association, that a final
franchise tax return, as described by Section 23332 of the Revenue
and Taxation Code, has been or will be filed with the Franchise Tax
Board, as required under Part 10.2 (commencing with Section 18401) of
Division 2 of the Revenue and Taxation Code.
(b) The Secretary of State shall notify the Franchise Tax Board of
the surrender.
The following is a portion of a CA statute:
(al) "Subsidiary of a specified limited liability company" means a
limited liability company or other business entity in which shares,
interests, or other securities possessing more than 50 percent of the
voting power are owned by the specified limited liability company.
(am) "Surviving limited liability company" means a limited
liability company into which one or more other limited liability
companies or other business entities are merged.
(an) "Surviving other business entity" means an other business
entity into which one or more limited liability companies are merged.
(ao) "Time a notice is given or sent," unless otherwise expressly
provided, means the time a written notice is deposited in the United
States mail; is personally delivered to the recipient, is delivered
to a common carrier for transmission, or is actually transmitted by
the person giving the notice by electronic transmission, to the
recipient; or the time any oral notice is communicated, in person or
by telephone, to the recipient or to a person at the office of the
recipient who the person giving the notice has reason to believe will
promptly communicate it to the recipient.
(ap) "Transact intrastate business" means to enter into repeated
and successive transactions of business in this state, other than in
interstate or foreign commerce.
(1) Without excluding other activities which may not be considered
to be transacting intrastate business, a foreign limited liability
company shall not be considered to be transacting intrastate business
merely because its subsidiary transacts intrastate business, or
merely because of its status as any one or more of the following:
(A) A shareholder of a domestic corporation.
(B) A shareholder of a foreign corporation transacting intrastate
business.
(C) A limited partner of a foreign limited partnership transacting
intrastate business.
(D) A limited partner of a domestic limited partnership.
(E) A member or manager of a foreign limited liability company
transacting intrastate business.
(F) A member or manager of a domestic limited liability company.
(2) Without excluding other activities which may not be considered
to be transacting intrastate business, a foreign limited liability
company shall not be considered to be transacting intrastate business
within the meaning of this subdivision solely by reason of carrying
on in this state any one or more of the following activities:
(A) Maintaining or defending any action or suit or any
administrative or arbitration proceeding, or effecting the settlement
thereof, or the settlement of claims or disputes.
(B) Holding meetings of its managers or members or carrying on any
other activities concerning its internal affairs.
(C) Maintaining bank accounts.
(D) Maintaining offices or agencies for the transfer, exchange,
and registration of the foreign limited liability company's
securities or maintaining trustees or depositaries with respect to
those securities.
(E) Effecting sales through independent contractors.
(F) Soliciting or procuring orders, whether by mail or through
employees or agents or otherwise, where those orders require
acceptance without this state before becoming binding contracts.
(G) Creating or acquiring evidences of debt or mortgages, liens,
or security interests in real or personal property.
(H) Securing or collecting debts or enforcing mortgages and
security interests in property securing the debts.
(I) Conducting an isolated transaction that is completed within
180 days and not in the course of a number of repeated transactions
of a like nature.
(3) A person shall not be deemed to be transacting intrastate
business in this state merely because of its status as a member or
manager of a domestic limited liability company or a foreign limited
liability company registered to transact intrastate business in this
state.
(aq) "Vote" includes authorization by written consent.
(ar) "Voting power" means the power to vote on any matter at the
time any determination of voting power is made and does not include
the right to vote upon the happening of some condition or event which
has not yet occurred.
(as) "Withdrawal" includes the resignation or retirement of a
member as a member.
(at) "Written" or "in writing" includes facsimile, telegraphic,
and other electronic communication as authorized by this code.