AN ACT TO AMEND SECTION 253, TITLE 8, DELAWARE CODE, ENTITLED "GENERAL CORPORATION LAW" AND RELATING TO THE MERGER OF PARENT CORPORATION AND SUBSIDIARY.
Be it enacted by the General Assembly of the State of Delaware (two-thirds of all Members elected to each House thereof concurring therein):
Section 1. § 253, Title 8, Delaware Code, is hereby repealed and a new § 253 is hereby enacted to read as follows:
§ 253. Merger of parent corporation and subsidiary
(a) Any corporation organized or existing under the laws of this State, or under the laws of any other state or jurisdiction subject to the laws of the United States, if the laws of such other state or jurisdiction shall permit such a merger, owning at least ninety per centum of the outstanding shares of each class of the stock of any other corporation or corporations organized or existing under the laws of this State, or under the laws of any other state or jurisdiction subject to the laws of the United States, if the laws of such other state or jurisdiction shall permit such a merger, may file in the office of the Secretary of State a certificate of such ownership and merger 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 either to merge such other corporation or corporations into it and to assume all of its or their obligations, or to merge itself, or itself and one or more of such other corporations, into one of such other corporations, and the date of the adoption thereof; provided, however, that in case the parent corporation shall not own all the outstanding stock of all the subsidiary corporations, parties to a merger as aforesaid, the resolution of the board of directors of the parent corporation shall state the terms and conditions of the merger, including the securities, cash or other consideration to be issued, paid or delivered by the surviving corporation upon surrender of each share of the subsidiary corporation or corporations not owned by the parent corporation. If the parent corporation be not the surviving corporation, said resolution shall include provision for the pro rata issuance of stock of the surviving corporation to the holders of the stock of the parent corporation on surrender of the certificates therefor, and said certificate of ownership and merger shall state that the proposed merger has been approved by the holders of a majority of the stock of the parent corporation at a meeting of such stockholders duly called and held after twenty days' notice of the purpose thereof mailed to the last known post office address of each such stockholder. A certified copy of the certificate shall be recorded in the office of the recorder of deeds of any county of this State in which the principal office of either the parent or a subsidiary corporation is located. If the surviving corporation is organized or exists under the laws of any state or jurisdiction, other than the laws of this State, the provisions of section 252 (d) of this title shall also apply to a merger under this section.
(b) Upon the recording of the certificate pursuant to subsection (a) of this section, all of the estate, property, rights, privileges and franchises of the corporation or corporations which did not survive the merger shall vest in and be held and enjoyed by the surviving corporation as fully and entirely and without change or diminution as the same were before held and enjoyed by the corporation or corporations which did not survive the merger and be managed and controlled by the surviving corporation, and except as hereinafter in this section provided, in its name, but subject to all liabilities and obligations of the corporation or corporations which did not survive the merger and the rights of all creditors thereof. The surviving 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 the surviving corporation is organized. The surviving corporation shall be deemed to have assumed all the liabilities and obligations of the corporation or corporations, which did not survive the merger, and shall be liable in the same manner as if it had itself incurred such liabilities and obligations.
(c) If the surviving corporation is a Delaware corporation, it may relinquish its corporate name and assume in place thereof the name of a corporation which did not survive the merger by the inclusion of a provision to that effect in the resolution of merger adopted by the directors of the parent corporation and set forth in the certificate of ownership and merger, and upon the filing and recording 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.
(d) 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 sections 251 and 252 of this title. The provisions of section 262 of this title shall not apply to any merger effected under this section, except as provided in paragraph (e) of this section.
(e) In the event all of the stock of a subsidiary Delaware Corporation party to a merger effected under this section is not owned by the parent corporation immediately prior to the merger, the surviving corporation shall within 10 days after the date on which the Certificate of Ownership and Merger has been filed and recorded, notify each stockholder of such Delaware Corporation that the Certificate of Ownership and Merger has been filed and recorded and the terms and conditions of the merger. The notice shall be sent by registered mail, return receipt requested, addressed to the stockholder at his last known address as it appears on the books of the corporation. If any such stockholder shall within 20 days after the date of mailing of the notice object in writing to said merger and demand in writing from the surviving corporation, payment for his stock, such surviving corporation shall, within 30 days after the expiration of the period of 20 days, pay to him the value of his stock on the date of the recording of the Certificate of Ownership and Merger, exclusive of any element of value arising from the expectation or accomplishment of said merged. If during the period of 30 days provided for herein the surviving corporation and any such objecting stockholder fail to agree as to the value of such stock, any such stockholder or the corporation may file a petition in the Court of Chancery as provided in paragraph (c) of section 262 of this title and thereupon the parties shall have the rights and duties and follow the procedure set forth in paragraphs (d) to (j), inclusive, of section 262.
Approved April 17, 1959.