Legal Question in Business Law in California

If you were not a stockholder, all that is required is for the company to submit the same form as the annual notice to SecState, showing all the current officers and directors info. Download one from the SecState website, fill it in online with current info and leave a blank for your position. Then have the CEO sign it and you mail it. If a stockholder turning in your stock, the co has to document return of stock in the records.

Sounds to me as though you are confusing resignation from a job with surrendering your ownership. People who are officers of small business corporations are often shareholders as well. Further, there are two aspects to certain top corporate jobs - you may, in addition to being an employee, also be a statutorily-required officer. Here's some explanation:

For-profit corporations are required to have three officers: A chief executive officer (president); a corporate secretary; and a chief financial officer (or treasurer). One person can hold more than one office.

An officer has the legal power to resign at any time. Resigning may be a breach of contract, if there is one, but nevertheless the officer cannot be compelled to serve out his contract. Resignation is accomplished by giving notice to the corporation. Corporations Code 312(b).

Ordinarily, an unequivocal letter of resignation, stating when it is effective, written and delivered to either the secretary, president/CEO, or both, will suffice.

The procedure suggested by Mr. Nelson would assure the government and public also have notice of your resignation, if the CEO will cooperate. (The form is an SI-200 C.) Keep in mind that while an updated SI-200 C must be filed annually, filing after a change of officers is permissive, not mandatory. Corporations Code section 1502.

If you are a director, your resignation should also state that you are resigning from the board, effective immediately (or whenever you want it to be effective). This is also your right, see Corporations Code section 305(d) for notice provisions, etc.

Now, if you are also a shareholder, I must say that I do not know of any law that requires the corporation to take back your shares, to cancel them, or least of all, to buy them from you. This may be covered in a shareholders' agreement, of course, but if it is not, you have limited options for getting rid of them (but why not keep them - you can become a corporate gadfly if it suits you later on).

One possible reason for wanting to dump small-business shares could be that the corporation is a sub-S and you are being allocated a percentage of profits but no dividends are being declared, requiring you to pay taxes on income you haven't been paid. I believe this abuse of an outsider/minority stockholder can be stopped by withdrawing, or threatening to withdraw, you election of "S" status. It requires on-going unanimous election. Consult an attorney beforehand, though.