In a post last week, I wrote about the recurring question of who is an “officer” for purposes of determining qualification for advancement, indemnification, and insurance benefits. I received several comments about the post, including a note from Keith Paul Bishop of the Allen Matkins law firm, who writes the California Corporate & Securities Law blog. Bishop wrote to send me links to two of his blog posts, in which he explored the California and Delaware statutory provisions relevant to the question of, as he put it, “what makes an officer an officer?” His blog posts provide interesting additional perspective on this question.

California

In the first of the two posts (here), Bishop examines the relevant California statutes. He first noted that the California General Corporations Law does not define the term “officer,” but that the California Corporations Code Section 312(a) does require that a corporation have:

(1) a chairperson of the board, who may be given the title of chair of the board, chairperson of the board, chairperson, or a president or both, (2) a secretary, (3) a chief financial officer, and (4) such other officers with such titles and duties as shall be stated in the bylaws or determined by the board and as may be necessary to enable it to sign instruments and share certificates.

As Bishop notes, the first three categories of persons are officers by virtue of their titles, while persons in the last category must fulfill at least three conditions: First, they must have a title, second, they must have duties, and third, they must be necessary for the corporation to sign instruments and share certificates. Both the title and the duties must be either stated in the bylaws or determined by the board of directors.

Bishop notes further that Section 312(a) is a statement of what officers a corporation must have. It does not, he observes, “state that persons are officers only if they fall into one of the four mandated categories of officers.” Thus, the California General Corporation Law “leave open the possibility that persons, not described in Section 312(a), are officers.”

Delaware

In the second of the two posts (here), Bishop reviews the relevant Delaware statutory provisions. Delaware, by contrast to California, does not require that a corporation organized under its laws have particular titles such as president, treasurer, or secretary. 10 Del. Code Section 3114(b) (what Bishop calls the “deemed consent” statute) defines the term “officer” as follows:

(i) is or was the president, chief executive officer, chief operating officer, chief financial officer, chief legal officer, controller, treasurer or chief accounting officer of the corporation at any time during the course of conduct alleged in the action or proceeding to be wrongful,

(ii) is or was identified in the corporation’s public filings with the United States Securities and Exchange Commission because such person is or was 1 of the most highly compensated executive officers of the corporation at any time during the course of conduct alleged in the action or proceeding to be wrongful, or

(iii) has, by written agreement with the corporation, consented to be identified as an officer for purposes of this section.

This definition of the term “officer” is relevant because Section 145(c) of the Delaware General Corporation Law specifies that for indemnification with respect to any act or occurrence occurring after December 31, 2020, references to “officer for purposes of mandatory indemnification are limited to only persons who at the time of the act or omission are deemed to have consented to service by delivery of process to the registered agent of the corporation pursuant to Section 3114(b).