§ 8016 Merger Abandonment Authority

Corporations Code·California

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Key Takeaways

•The board can cancel a merger anytime before it happens.
•They don’t need to ask members or others for permission to cancel.
•But they can’t ignore contracts with other companies involved.

Example

Two toy companies plan to merge, but one company’s board changes their mind.

The board can stop the merger without asking the members, but if they signed a contract with the other company, they might still have to follow some rules from that contract.

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

Official Source

View on CA.gov

§ 8016 Merger Abandonment Authority

The board may, in its discretion, abandon a merger, subject to the contractual rights, if any, of third parties, including other constituent corporations, without further approval by the members (Section 5034) or other persons entitled to approve the merger at any time before the merger is effective. (Amended by Stats. 1982, Ch. 662, Sec. 18.)

Last verified: January 23, 2026

Key Terms

board abandon a merger contractual rights third parties without further approval members merger is effective

References

Official text at leginfo.legislature.ca.gov
California Legislature. Corporations Code. Section 8016.

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Key Takeaways

Example

Key Terms

Related Statutes

References