Legal Question in Business Law in California

Re: Amending Articles of Incorporation

The Bylaws of the corp. should specify how to amend the Articles; if silent, then look to Calif. non-profit corporation law. Please note that there are potential issues with your tax exempt status to be aware of. You should seek the assistance of an attorney on this.

Re: Amending Articles of Incorporation

A California non-profit corporation can amend its articles of incorporation, subject to some statutory limitations. See Corporations Code sections 5810(a), 7810(a), and 9620(a). The Secretary of State will notify the Franchise Tax Board of the change. The limitations mainly affect member rights, majority vote, board make-up and quorum, and lawfulness of purpose. When property is held in a charitable trust, Attorney General approval may be required.

Additional requirements are imposed if the change is from one type of non-profit to another, e.g. from public benefit to mutual benefit.

All types of corporate mergers are also at least theoretically permitted under California law. Most mergers require Attorney General approval, especially where a more specific and restricted type of corporation is merged into a less restrictive one, e.g. public benefit into mutual benefit.

The merger process is rather formal and several documents must be prepared, executed and filed in order to effect the merger. In addition, pre-clearance by the FTB and IRS is strongly recommended, as fundamental changes to a corporation's structure can affect its tax exemptions.

So, the bottom line is that what you're proposing may be possible, but not without the close guidance of an attorney with non-profit experience.

Re: Amending Articles of Incorporation

Yes it may be done whether or not it is in the bylaws. Call me directly at (619) 222-3504.