LawWiki
HomeCodesSearchGlossaryAPIAbout
LawWiki

Plain English summaries of California law with zero-hallucination AI. Every summary is verified against official source text.

Product

  • Search
  • Codes
  • About

Legal

  • Privacy Policy
  • Terms of Service
  • Disclaimer

© 2026 LawWiki. All rights reserved.

HomeCorporations CodeCh. 11.5§ 1159 Shareholder Rights In Conversion

§ 1159 Shareholder Rights In Conversion

Corporations Code·California
AI Summary·Official Text·Key Terms·Related Statutes·References
AI SummaryVerified

§ 1159 Shareholder Rights In Conversion

This law says that when a company changes its type, it is treated like a big re‑organization for the rules in Chapter 13, so the owners get the same rights and the company has the same duties as in a re‑organization.

Key Takeaways

  • •A conversion is treated like a re‑organization for Chapter 13 rules.
  • •Shareholders keep all the rights they would have in a re‑organization.
  • •The converting company must meet all the obligations of a re‑organized company.
  • •These rules only apply to Chapter 13, not to Chapter 12.

Example

A tech firm decides to convert from a regular corporation to a converting corporation and must get its shareholders to vote on the change.

Because of this law, the shareholders get all the voting and other rights they would have if the company were doing a formal re‑organization, and the company must follow all the duties that a re‑organized company would have under Chapter 13.

AI-generated — May contain errors. Not legal advice. Always verify source.

Official Source
View on CA.gov

§ 1159 Shareholder Rights In Conversion

The shareholders of a converting corporation shall have all of the rights under Chapter 13 (commencing with Section 1300) of the shareholders of a corporation involved in a reorganization requiring the approval of its outstanding shares (Section 152), and the converting corporation shall have all of the obligations under Chapter 13 (commencing with Section 1300) of a corporation involved in the reorganization. Solely for purposes of applying the provisions of Chapter 13 (and not for purposes of Chapter 12), a conversion pursuant to Section 1151 or 1157 shall be deemed to constitute a reorganization. (Added by Stats. 2002, Ch. 480, Sec. 6. Effective January 1, 2003.)

Last verified: January 10, 2026

Key Terms

converting corporationreorganizationChapter 13Section 1151Section 1157

Related Statutes

  • § 1150 Business Entity Conversion Definitions
  • § 1112.5 Merger Approval For Social Purpose Corporations
  • § 3305 Dissenting Shareholder Rights Conversion
  • § 1151 Corporate Conversion Requirements
  • § 1152 Corporate Conversion Plan Requirements

References

  • Official text at leginfo.legislature.ca.gov
  • California Legislature. Corporations Code. Section 1159.
View Official Source