CHAPTER 157 - GENERAL PROVISIONS RESPECTING CORPORATIONS

AN ACT TO AMEND CHAPTER 65 OF THE REVISED CODE OF THE STATE OF DELAWARE OF 1935 RELATING TO CORPORATIONS.

Be it enacted by the Senate and House of Representatives of the State of Delaware in General Assembly met (two-thirds of all the members elected to each branch thereof concurring therein):

SECTION 1. That Chapter 65 of the Revised Code of Delaware of 1935, as amended, be and the same hereby is further amended by inserting therein a new section to be known as Code Section 2035A, Sec. 3A, as follows, viz.:

2035A. SEC. 3A. Power to Confer Academic or Honorary Degrees:--No corporation hereafter created under the provisions of this Chapter shall have the power to confer academic or honorary degrees unless the Certificate of Incorporation or an amendment thereof shall expressly so provide and unless the Certificate of Incorporation or an amendment thereof prior to its being filed in the office of the Secretary of State shall have endorsed thereon the approval of the State Board of Education of the State of Delaware. No corporation heretofore created under this Chapter, any provision in its Certificate of Incorporation to the contrary notwithstanding, shall hereafter possess the power aforesaid without first filing in the office of the Secretary of State, in accordance with Sec. 26 of this Chapter, a Certificate of Amendment expressly so providing, the filing of which Certificate of Amendment in the office of the Secretary of State shall be subject to prior approval of the said State Board of Education, evidenced as hereinabove provided. Approval as aforesaid shall be granted only when it shall appear to the reasonable satisfaction of the said State Board of Education, that the corporation is engaged in conducting a bona fide institution of higher learning, giving instructions in arts and letters, science, or the professions, or that the corporation proposes, in good faith, to engage in that field and has or will have the resources, including personnel, requisite for the conduct of an institution of higher learning.

SECTION 2. That Sec. 15 of Chapter 65 of the Revised Code of Delaware of 1935, being Section 2047 of said Revised Code, as amended, be and the same hereby is further amended by striking out the whole of said section 15 and inserting in lieu thereof the following, viz.:

2047. SEC. 15. Certificates of Shares:--Every holder of stock in a corporation shall be entitled to have a certificate, signed by, or in the name of the corporation by, the President or a Vice-President and the Treasurer or an Assistant Treasurer, or the Secretary or an Assistant Secretary of such corporation, certifying the number of shares owned by him in such corporation; provided, however, that, where such certificate is signed (1) by a transfer agent or an assistant transfer agent or (2) by a transfer clerk acting on behalf of such corporation and a registrar, the signature of any such President, Vice-President, Treasurer, Assistant Treasurer, Secretary or Assistant Secretary may be facsimile. In case any officer or officers who shall have signed, or whose facsimile signature or signatures shall have been used on, any such certificate or certificates shall cease to be such officer or officers of such corporation, whether because of death, resignation or otherwise, before such certificate or certificates shall have been delivered by such corporation, such certificate or certificates may nevertheless be adopted by such corporation and be issued and delivered as though the person or persons who signed such certificate or certificates or whose facsimile signature or signatures shall have been used thereon had not ceased to be such officer or officers of such corporation.

SECTION 3. That Section 39 of Chapter 65 of the Revised Code of Delaware of 1935, being Section 2071 of said Revised Code, as amended, be and the same hereby is further amended by striking out the whole of said Section 39, as amended, and inserting in lieu thereof the following, viz.:

2071. SEC. 39. Dissolution; Proceedings for:--If it should be deemed advisable, in the judgment of the Board of Directors, and most for the benefit of any corporation organized under this Chapter, that it should be dissolved, the said board, within ten days after the adoption of a resolution to that effect by a majority of the whole board at any meeting called for that purpose, of which meeting every director shall have received at least three days' notice, shall cause notice of the adoption of such resolution to be mailed to each stockholder of record having voting power, and also cause a like notice to be inserted in a newspaper published in the county wherein the corporation shall have its principal office in the State of Delaware, at least three weeks successively, once a week, next preceding the time appointed for the same, of a meeting of the stockholders having voting power, to be held at the office of the corporation, to take action upon the resolution so adopted by the Board of Directors, which meeting may, by consent of a majority in interest of the stockholders present in person or by proxy, having voting power, be adjourned or recessed from time to time. At said meeting a vote of the stockholders, having voting power, by ballot in person or by proxy, shall be taken for and against the proposed dissolution, which vote shall be conducted by two Judges appointed for the purpose, either by the directors or by the said meeting. Said judges shall decide upon the qualifications of voters, and accept their votes, and when the voting is completed, count and ascertain the number of shares voted respectively for and against the dissolution, and shall declare whether the persons or bodies corporate holding two-thirds of the voting stock of said corporation have voted for the proposed dissolution; and shall make out a certificate accordingly. stating the number of shares of stock having voting power issued and outstanding and entitled to vote thereon, and the number of shares voted for and the number of shares voted against the dissolution, respectively, and shall subscribe and deliver said certificate to the secretary of the corporation. If it shall appear by said certificate of the judges that the persons or bodies corporate holding two-thirds of the stock of said corporation having voting power have voted in favor of the dissolution, a certificate certifying that such dissolution has been authorized in accordance with the provisions of this section and the names and residences of the directors and officers shall be made under the seal of the corporation and signed by its President or a Vice-President and its Secretary or an Assistant Secretary, and the President or such Vice-President shall acknowledge the said certificate before an officer authorized by the laws of the State of Delaware to take acknowledgments of deeds; and the said certificate so executed and acknowledged shall be filed in the office of the Secretary of State, who, upon being satisfied by due proof that the requirements aforesaid have been complied with, shall issue his certificate that such certificate has been filed, and the Secretary of State shall cause his certificate to be published in one issue in a newspaper published in the county wherein was situated the principal office in the State of Delaware of the dissolved corporation. The Secretary of State shall ascertain the charge for publishing the certificate of dissolution as aforesaid, and collect the amount from the corporation before the certificate of dissolution is issued, and upon the filing in the office of the Secretary of State of an affidavit of the manager or publisher of the said newspaper that said certificate has been published one time, in said newspaper, the corporation shall be dissolved.

Whenever all the stockholders, having voting power, shall consent in writing, either in person or by duly authorized attorney, to a dissolution, no meeting of stockholders shall be necessary, but on filing such consent in the office of the Secretary of State, he shall, as above provided, issue a certificate of dissolution, which shall be published as above provided. In the event that such consent is signed by an attorney, the original power of attorney or a photostatic copy thereof shall be attached to and filed with such consent.

Whenever the Secretary of State issues a certificate of dissolution it shall be recorded in the office of the Recorder of the County in which the principal office of the corporation was maintained.

This section shall apply only to proceedings for dissolution in which the resolution by a majority of the whole board of directors is adopted after the date of the approval of this Act. All proceedings for dissolution in which the resolution by a majority of the whole board of directors is adopted on or prior to the date of the approval of this Act shall be governed by the law in force immediately prior to the approval of this Act, which as to such proceedings and only such proceedings is continued in force and effect.

SECTION 4. That Chapter 65 of the Revised Code of Delaware of 1935, as amended, be and the same hereby is further amended by inserting therein a new section to be known as Code Section 2083A, Sec. 51A, as follows, viz.:

2083A. Sec. 51A. In any derivative suit hereafter instituted by a stockholder of a corporation organized under the laws of this State, it shall be averred in the Bill of Complaint that the Complainant was a stockholder of the corporation at the time of the transaction of which he complains or that his stock thereafter devolved upon him by operation of law.

SECTION 5. That Sec. 59A of Chapter 65 of the Revised Code of Delaware of 1935, being Section 2091A of said Revised Code, as amended, be and the same hereby is further amended by striking out the whole of said Sec. 59A and inserting in lieu thereof the following, viz.:

2091A. Sec. 59A. Merger of Parent Corporation and Wholly Owned Subsidiary; Proceedings for:--Any corporation now or hereafter organized under the provisions of this Chapter or existing under the laws of this State, for the purpose of carrying on any kind of business, owning all the stock of any other corporation now or hereafter organized under the provisions of this Chapter or existing under the laws of this State, or now or hereafter organized under the laws of any other State of the United States of America, if the laws under which said other corporation is formed shall permit a merger as herein provided, may file in the office of the Secretary of State a certificate of such ownership in its name and under its corporate seal, signed by its president or a vice-president, and its secretary or treasurer or assistant secretary or assistant treasurer, and setting forth a copy of the resolution of its board of directors to merge such other corporation, and to assume all of its obligations and the date of the adoption thereof; and a certified copy of said Certificate shall be recorded in the office of the Recorder of Deeds of the County in which the principal place of business of the parent corporation is located, and if the other corporation is also a Delaware corporation and its principal place of business is located in a different County, another certified copy of said Certificate shall be recorded in the office of the Recorder of Deeds of such other County. Thereupon, all of the estate, property, rights, privileges and franchises of such other corporation shall vest in and be held and enjoyed by such parent corporation as fully and entirely and without change or diminution as the same were before held and enjoyed by such other corporation, and be managed and controlled by such parent corporation, and except as hereinafter in this section provided, in its name, but subject to all liabilities and obligations of such other corporation and the rights of all creditors thereof. The parent corporation shall not thereby acquire power to engage in any business, or to exercise any right, privilege or franchise, of a kind which it could not lawfully engage in or exercise under the provisions of the law by or pursuant to which such parent corporation is organized. The parent corporation shall be deemed to have assumed all the liabilities and obligations of the merged corporation, and shall be liable in the same manner as if it had itself incurred such liabilities and obligations. The parent corporation may relinquish its corporate name and assume in place thereof the name of the merged corporation, by including it in a provision to that effect in the Resolution of Merger adopted by the directors and set forth in the Certificate of Ownership, and upon the filing of such Certificate the change of name shall be completed, with the same force and effect and subject to the same conditions and consequences as if such change had been accomplished by proceedings under the appropriate section of this chapter. Any plan of consolidation or merger which requires or contemplates any changes other than those herein specifically authorized with respect to the parent corporation, shall be accomplished under the provisions of Section 59 of this Chapter. The provisions of Section 61 of this Chapter shall not apply to any merger effected under this Section.

SECTION 6. That Section 77A of Chapter 65 of the Revised Code of Delaware of 1935, being Section 2109A of said Revised Code, as amended, be and the same hereby is further amended by striking out the first paragraph of said Section 77A and inserting in lieu thereof the following, viz.:

2109A. Sec. 77A. Plan of Reorganization Under the Laws of the United States, Execution of, Filing Certificates:--(1) Any corporation now or hereafter organized under this Chapter or existing under the laws of this State, a plan of reorganization of which, pursuant to the provisions of any applicable statute of the United States, as now existing or hereafter enacted, relating to reorganizations of corporations, has been or shall be confirmed by the decree or order of a court of competent jurisdiction, shall have full power and authority to put into effect and carry out the plan and the decrees and orders of the court or judge relative thereto and may take any proceeding and do any act provided in the plan or directed by such decrees and orders, without further action by its directors or stockholders. Such power and authority may be exercised, and such proceedings and acts may be taken, as may be directed by such decrees or orders, by the trustee or trustees of such corporation appointed in the reorganization proceedings (or a majority thereof), or if none be appointed and acting, by designated officers of the corporation, or by a master or other representative appointed by the court or judge, with like effect as if exercised and taken by unanimous action of the directors and stockholders of the corporation. And also by striking out the third numbered paragraph of said Section 77A and substituting in lieu thereof the following, viz.:

(3) A certificate, executed as hereinafter provided, of any amendment, change or alteration, or of dissolution, or any agreement of merger or consolidation, made by such corporation pursuant to the foregoing provisions, shall be filed in the office of the Secretary of State, and a certified copy thereof recorded in the office of the Recorder of Deeds of the County in which the principal place of business is located, and shall thereupon become effective in accordance with its terms and the provisions hereof. Such certificate, agreement of merger or other instrument shall be made, executed and acknowledged, as may be directed by such decrees or orders, by the trustee or trustees appointed in the reorganization proceedings (or a majority thereof), or, if none be appointed and acting, by officers of the corporation, or by a master or other representative appointed by the court or judge, and shall certify that provision for the making of such certificate, agreement or instrument is contained in a decree or order of a court or judge having jurisdiction of a proceeding under such applicable statute of the United States for the reorganization of such corporation.

Approved April 18. 1945.