A Close Corporation keeps ownership tightly held, simplifies governance, and enables tailored shareholder agreements that limit transfers and protect continuity. It is suitable where owners want control, predictable succession, and fewer formal board requirements while still enjoying corporate liability protections.
Typical users include small business owners, family-owned companies, and certain professional practices that prefer close control and restricted share transfer.
These users select the close-corporation model to preserve control, reduce outsider influence, and encode buy-sell mechanics directly into corporate governance documents.
Foundational filing with the California Secretary of State that creates the corporation, states authorized shares, and names the initial agent for service of process; must match internal records and shareholder documentation.
Formal election or shareholder resolution that acknowledges the corporation will operate under close-corporation rules and any special statutory provisions, ensuring transfer restrictions and reduced formalities are enforceable.
Detailed contract among owners that sets transfer restrictions, preemption rights, valuation methods, buy-sell triggers, dispute resolution, and consent thresholds for major actions.
Accurate stock ledger and, if issued, certificates documenting ownership, issuance dates, and any legend noting transfer restrictions; essential for maintaining corporate formalities and enforcing restrictions.
Bylaws or written operating principles that define meeting frequency, voting thresholds, officer roles, and how shareholder-managed vs. board-managed decisions are handled.
Clauses that govern involuntary transfers, death or disability of owners, valuation formulas, and mandatory purchase obligations to preserve ownership continuity.
| Field | Configuration |
|---|---|
| Template name | Descriptive title for reuse and version control |
| Signature order | Set sequential or parallel signer order |
| Authentication level | Choose email, SMS code, or KBA as required |
| Storage location | Designate secure repository and retention policy |
Select a platform that supports secure audit trails, accepted file formats, and integrations with your document management systems.
Ensure the platform you choose enables audit trails, secure storage, and accessibility for all signers while meeting any industry-specific compliance requirements.
Corporation effective on approved filing date
File per California SOS schedule; initial filing often required after formation
Hold shareholder meetings and document minutes annually
File federal and state corporate returns by applicable deadlines
Meet California franchise and fee requirements to avoid penalties
| signNow | DocuSign | Adobe Sign | PandaDoc | HelloSign | |
|---|---|---|---|---|---|
| Starting Price | $8/user/mo | $15/user/mo | $14/user/mo | $19/user/mo | $15/user/mo |
| Free Trial | 7-day free trial | Verify with vendor | Verify with vendor | Verify with vendor | Verify with vendor |
| Bulk Send | Yes | Yes | Yes | Yes | No |
| Audit Trail | Yes | Yes | Yes | Yes | Yes |
| HIPAA Compliant | Yes | Yes | Yes | No | No |
| Envelope Cap | No cap | 100 envelopes/user/year | Varies | Varies | Varies |