Blogs

Further to our recent report: "California Board Gender Quota Law Faces Challenges," in this post: "Departing Is Such Sweet Sorrow: Some Things To Consider When You Leave California," Allen Matkins Partner Keith Paul Bishop takes aim at the lack of clarity of the critical terminology "principle executive offices" (PEO) used in California's new board gender quota law to identify which companies are subject to the law, and identifies these considerations for companies that may be contemplating moving their PEO to avoid the quota mandate:

• Corporate bylaws or the articles of incorporation may specify the location of the company's PEO. If so, they may need to be amended to change the location.  
• The company's loan agreements might include covenants restricting relocation of its PEO. 
• Employment agreements may allow an executive to resign with "good reason" if the company's PEO location is changed.
• The company may be required to qualify to transact intrastate business and to make tax and other filings in the new location.
• The location of the company's former address must be included on the cover pages of the next Form 8-K and Form 10-Q.
• If the company holds licenses that are location-specific (e.g., CA Financing Law license), appropriate filings must be made with the licensing authority.