Anyone have any horror stories from failing to foreign qualify to do business in a state? All I see online are all the articles written by the filing agents trying to stoke the fear of non-compliance, but have never actually seen something bad happen in all my years of practice.

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In a recent case defendants tried to use my clients' failure to register as a foreign corp doing buisness in California as grounds for dismissal. Many $$ were spent fighting on this issue. Court didn't render an opinion because we compelled to arbitration.

Surprised, since in California this seems particularly moot, since the defect can be cured? See United Medical Management Ltd. v. Gatto (1996) 49 Cal. App. 4th 1732, 57.

In the emerging companies space basically means you won’t get funding until you are.

But even outside of that context, even for a vanilla credit facility I’m surprised you were able to get lender counsel to close over a lack of good standing.

In that case, agreed, and your approach is standard in my experience.

Ditto. Was a sr. Corp para in biglaw. for 10 yrs before becoming an atty. I've never seen any ill effect, ever. It's closed over in lots of financings, as long as it's addressed later.

Depends on whether it's a post closing covenant....

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