Delaware General Assembly


CHAPTER 416

FORMERLY

HOUSE BILL NO. 424

AN ACT TO AMEND CHAPTER 15, TITLE 6 OF THE DELAWARE CODE RELATING TO THE CREATION, REGULATION, OPERATIONS AND DISSOLUTION OF DOMESTIC PARTNERSHIPS AND THE REGISTRATION AND REGULATION OF FOREIGN LIMITED LIABILITY PARTNERSHIPS.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF DELAWARE (Three-fifths of all members elected to each house thereof concurring therein):

Section Amend § 15-101(16), Chapter 15, Title 6 of the Delaware Code by deleting “, limited partnership, trust, estate” immediately after the word “partnership” and substituting in lieu thereof “(whether general or limited)”, by inserting “trust, estate,” immediately after “limited liability company,”, by inserting “(including any group, organization, co-tenancy, plan, board, council or committee)” immediately after the word “association”, by inserting “government (including a country, state, county or any other governmental subdivision, agency or instrumentality),” immediately prior to the word “custodian”, and by inserting “(or series thereof)” immediately after the word “entity”.

Section Amend § 15-105(d), Chapter 15, Title 6 of the Delaware Code by inserting “or § 15-111(i)(4)” immediately after “or as specified in § 15-111(d)” in the fourth sentence thereof and by inserting “or § 15-111(i)(4)” immediately after “or as provided in § 15-111(d)” in the fifth sentence thereof.

Section Amend § 15-111(a), Chapter 15, Title 6 of the Delaware Code by deleting said subsection in its entirety and substituting in lieu thereof the following:

“(a) Each partnership that files a statement of partnership existence, a statement of qualification or a statement of foreign qualification shall have and maintain in the State of Delaware:

(1) A registered office, which may but need not be a place of its business in the State of Delaware; and

(2) A registered agent for service of process on the partnership, which agent may be any of

a. the partnership itself,

b. an individual resident in the State of Delaware,

c. a domestic limited liability company, a domestic corporation, a domestic partnership (other than the partnership itself)(whether general (including a limited liability partnership) or limited (including a limited liability limited partnership)), or a domestic statutory trust, or

d. a foreign corporation, a foreign partnership (whether general (including a limited liability partnership) or limited (including a limited liability limited partnership)), a foreign limited liability company, or a foreign statutory trust.”.

Section Amend § 15-111(d), Chapter 15, Title 6 of the Delaware Code by deleting the “,” immediately after “statement of partnership existence” in the fourth sentence thereof and substituting in lieu thereof the word “and” and by inserting “(in each case as applicable)” immediately after “statement of qualification” in the fourth sentence thereof.

Section Amend § 15-111, Chapter 15, Title 6 of the Delaware Code by inserting new subsections (e), (f), (g), (h), (i) and (j) as follows:

“(e) Every registered agent shall:

(1) If an entity, maintain a business office in the State of Delaware which is generally open, or if an individual, be generally present at a designated location in the State of Delaware, at sufficiently frequent times to accept service of process and otherwise perform the functions of a registered agent;

(2) If a foreign entity, be authorized to transact business in the State of Delaware;

(3) Accept service of process and other communications directed to the partnerships for which it serves as registered agent and forward same to the partnership to which the service or communication is directed; and

(4) Forward to the partnerships for which it serves as registered agent the statement for the annual tax described in § 15-1208 of this title or an electronic notification of same in a form satisfactory to the Secretary of State.

(f) Any registered agent who at any time serves as registered agent for more than fifty entities (a “Commercial Registered Agent”), whether domestic or foreign, shall satisfy and comply with the following qualifications.

(1) A natural person serving as a Commercial Registered Agent shall:

a. Maintain a principal residence or a principal place of business in the State of Delaware;

b. Maintain a Delaware business license;

c. Be generally present at a designated location within the State of Delaware during normal business hours to accept service of process and otherwise perform the functions of a registered agent as specified in subsection (e); and

d. Provide the Secretary of State upon request with such information identifying and enabling communication with such Commercial Registered Agent as the Secretary of State shall require.

(2) A domestic or foreign corporation, a domestic or foreign partnership (whether general (including a limited liability partnership) or limited (including a limited liability limited partnership)), a domestic or foreign limited liability company, or a domestic or foreign statutory trust serving as a Commercial Registered Agent shall:

a. Have a business office within the State of Delaware which is generally open during normal business hours to accept service of process and otherwise perform the functions of a registered agent as specified in subsection (e);

b. Maintain a Delaware business license;

c. Have generally present at such office during normal business hours an officer, director or managing agent who is a natural person; and

d. Provide the Secretary of State upon request with such information identifying and enabling communication with such Commercial Registered Agent as the Secretary of State shall require.

(3) For purposes of this subsection and subsection (i)(2)a., a Commercial Registered Agent shall also include any registered agent which has an officer, director or managing agent in common with any other registered agent or agents if such registered agents at any time during such common service as officer, director or managing agent collectively served as registered agents for more than fifty entities, whether domestic or foreign.

(g) Every partnership formed under the laws of the State of Delaware or qualified to do business in the State of Delaware that has and maintains a registered agent pursuant to § 15-111 of this title shall provide to its registered agent and update from time to time as necessary the name, business address and business telephone number of a natural person who is a partner, officer, employee or designated agent of the partnership, who is then authorized to receive communications from the registered agent. Such person shall be deemed the communications contact for the partnership. Every registered agent shall retain (in paper or electronic form) the above information concerning the current communications contact for each partnership for which he, she, or it serves as registered agent. If the partnership fails to provide the registered agent with a current communications contact, the registered agent may resign as the registered agent for such partnership pursuant to this Section.

(h) The Secretary of State is authorized to issue such rules and regulations as may be necessary or appropriate to carry out the enforcement of subsections (e), (f) and (g) of this Section, and to take actions reasonable and necessary to assure registered agents’ compliance with subsections (e), (f) and (g). Such actions may include refusal to file documents submitted by a registered agent.

(i) Upon application of the Secretary of State, the Court of Chancery may enjoin any person or entity from serving as a registered agent or as an officer, director or managing agent of a registered agent.

(1) Upon the filing of a complaint by the Secretary of State pursuant to this Section, the Court may make such orders respecting such proceeding as it deems appropriate, and may enter such orders granting interim or final relief as it deems proper under the circumstances.

(2) Any one or more of the following grounds shall be a sufficient basis to grant an injunction pursuant to this Section:

a. With respect to any registered agent who at any time within one year immediately prior to the filing of the Secretary of State’s complaint is a Commercial Registered Agent, failure after notice and warning to comply with the qualifications set forth in subsection (e) and/or the requirements of subsections (f) or (g) above;

b. The person serving as a registered agent, or any person who is an officer, director or managing agent of an entity registered agent, has been convicted of a felony or any crime which includes an element of dishonesty or fraud or involves moral turpitude; or

c. The registered agent has engaged in conduct in connection with acting as a registered agent that is intended to or likely to deceive or defraud the public.

(3) With respect to any order the Court enters pursuant to this Section with respect to an entity that has acted as a registered agent, the Court may also direct such order to any person who has served as an officer, director or managing agent of such registered agent. Any person who, on or after January 1, 2007, serves as an officer, director or managing agent of an entity acting as a registered agent in the State of Delaware shall be deemed thereby to have consented to the appointment of such registered agent as agent upon whom service of process may be made in any action brought pursuant to this Section, and service as an officer, director or managing agent of an entity acting as a registered agent in the State of Delaware shall be a signification of the consent of such person that any process when so served shall be of the same legal force and validity as if served upon such person within the State of Delaware, and such appointment of the registered agent shall be irrevocable.

(4) Upon the entry of an order by the Court enjoining any person or entity from acting as a registered agent, the Secretary of State shall mail or deliver notice of such order to each affected partnership.

a. that has specified the address of a place of business in a record of the Secretary of State, to the address specified, or

b. an address of which the Secretary of State has obtained from the partnership’s former registered agent, to the address obtained.

If such a partnership is a domestic partnership and fails to obtain and designate a new registered agent within thirty (30) days after such notice is given, the statement of partnership existence and statement of qualification of such partnership (in each case as applicable) shall be deemed to be cancelled. If such a partnership is a foreign limited liability partnership and fails to obtain and designate a new registered agent within thirty (30) days after such notice is given, such foreign limited liability partnership shall not be permitted to do business in the State of Delaware and its statement of foreign qualification shall be deemed to be cancelled. If any other affected partnership is a domestic partnership and fails to obtain and designate a new registered agent within sixty (60) days after entry of an order by the Court enjoining such partnership’s registered agent from acting as a registered agent, the statement of partnership existence and statement of qualification of such partnership (in each case as applicable) shall be deemed to be cancelled. If any other affected partnership is a foreign limited liability partnership and fails to obtain and designate a new registered agent within sixty (60) days after entry of an order by Court enjoining such partnership’s registered agent from acting as a registered agent, such foreign limited liability partnership shall not be permitted to do business in the State of Delaware and its statement of foreign qualification shall be deemed to be cancelled. If the Court enjoins a person or entity from acting as a registered agent as provided in this Section and no new registered agent shall have been obtained and designated in the time and manner aforesaid, service of legal process against the partnership for which the registered agent had been acting shall thereafter be upon the Secretary of State in accordance with Section 15-113 of this title. The Court of Chancery may, upon application of the Secretary of State on notice to the former registered agent, enter such orders as it deems appropriate to give the Secretary of State access to information in the former registered agent’s possession in order to facilitate communication with the partnerships the former registered agent served.

(j) The Secretary of State is authorized to make a list of registered agents available to the public, and to establish such qualifications and issue such rules and regulations with respect to such listing as the Secretary of State deems necessary or appropriate.”.

Section Amend § 15-407(d), Chapter 15, Title 6 of the Delaware Code by inserting the following sentence at the beginning thereof: “Unless otherwise provided in a partnership agreement, meetings of partners may be held by means of conference telephone or other communications equipment by means of which all persons participating in the meeting can hear each other, and participation in a meeting pursuant to this subsection shall constitute presence in person at the meeting.”.

Section Amend § 15-901(a), Chapter 15, Title 6 of the Delaware Code by deleting the word “or” immediately after “business trust” and substituting in lieu thereof “, an” and by inserting “or entity” immediately after “unincorporated business”.

Section Amend § 15-901(g), Chapter 15, Title 6 of the Delaware Code by inserting the word “and” immediately after “and distribute its assets,” in the first sentence thereof, by deleting “, and the conversion shall constitute a continuation of the existence of the converting other entity in the form of a domestic partnership” immediately before the “.” at the end of the first sentence thereof, by deleting “the domestic partnership shall,” immediately before “for all purposes” in the second sentence thereof, by inserting “the domestic partnership shall” immediately after “the State of Delaware,” in the second sentence thereof, and by inserting “and the conversion shall constitute a continuation of the existence of the converting other entity in the form of a domestic partnership” immediately before the “.” at the end of the second sentence thereof.

Section Amend § 15-903(a), Chapter 15, Title 6 of the Delaware Code by deleting the word “or” immediately after “business trust” and substituting in lieu thereof “, an” and by inserting “or entity” immediately after “unincorporated business”.

Section Amend § 15-903(c), Chapter 15, Title 6 of the Delaware Code by inserting “entity or” immediately before “business form” and by inserting immediately before the “.” at the end thereof “, and the conversion shall not constitute a dissolution of such partnership. When a partnership has converted to another entity or business form pursuant to this Section, for all purposes of the laws of the State of Delaware, the other entity or business form shall be deemed to be the same entity as the converting partnership and the conversion shall constitute a continuation of the existence of the partnership in the form of such other entity or business form”.

Section Amend § 15-903(d), Chapter 15, Title 6 of the Delaware Code by inserting “entity or” immediately before all three appearances of “business form” therein.

Section Amend § 15-903(e), Chapter 15, Title 6 of the Delaware Code by inserting “entity or” immediately before “business form” in the first sentence thereof.

Section Amend § 15-903(e)(3), Chapter 15, Title 6 of the Delaware Code by inserting “entity or” immediately before “business form” and by inserting “, and the name of such entity or business form” immediately before the “;” at the end of said subsection.

Section Amend § 15-903(h), Chapter 15, Title 6 of the Delaware Code by inserting “entity or” immediately before all seven appearances of “business form” in said subsection.

Section Amend § 15-904(a), Chapter 15, Title 6 of the Delaware Code by inserting “a statutory trust,” immediately before “a business trust”, by deleting the word “or” immediately after “a business trust” and substituting in lieu thereof “, an”, and by inserting “or entity” immediately after “any other unincorporated business”.

Section Amend § 15-904(c)(4), Chapter 15, Title 6 of the Delaware Code by deleting the word “and” at the end thereof.

Section Amend § 15-904(c)(5), Chapter 15, Title 6 of the Delaware Code by deleting the “.” at the end thereof and substituting in lieu thereof “; and”.

Section Amend § 15-904(c), Chapter 15, Title 6 of the Delaware Code by inserting a new subsection (6) thereto reading as follows:

“(6) That the domestication has been approved in the manner provided for by the document, instrument, agreement or other writing, as the case may be, governing the internal affairs of the non-United States entity and the conduct of its business or by applicable non-Delaware law, as appropriate.”.

Section Amend § 15-904(g), Chapter 15, Title 6 of the Delaware Code by inserting the word “the” immediately after “Prior to” and by inserting the word “of” immediately after the word “filing”.

Section Amend § 15-904(h), Chapter 15, Title 6 of the Delaware Code by inserting “(and also in the non-United States entity, if and for so long as the non-United States entity continues its existence in the foreign jurisdiction in which it was existing immediately prior to the domestication)” immediately after the first appearance of the words “to which such non-United States entity has been domesticated” in the first sentence thereof, by inserting “(and also of the non-United States entity, if and for so long as the non-United States entity continues its existence in the foreign jurisdiction in which it was existing immediately prior to the domestication)” immediately after the words “the property of such domestic partnership” in the first sentence thereof, and by inserting “(and also to the non-United States entity, if and for so long as the non-United States entity continues its existence in the foreign jurisdiction in which it was existing immediately prior to the domestication)” immediately after the second appearance of the words “to which such non-United States entity has been domesticated” in the first sentence thereof.

Section Amend § 15-904(i), Chapter 15, Title 6 of the Delaware Code by deleting from the first sentence thereof “the domestic partnership shall,”, by inserting “the domestic partnership shall” immediately after “the State of Delaware,” in the first sentence thereof, by inserting “and the domestication shall constitute a continuation of the existence of the domesticating non-United States entity in the form of a domestic partnership” immediately before the “.” at the end of the first sentence thereof, by inserting the word “and” immediately before “the domestication shall not be deemed to constitute a dissolution” in the second sentence thereof, and by deleting “, and the domestication shall constitute a continuation of the existence of the domesticating non-United States entity in the form of a domestic partnership” immediately before the “.” at the end of the second sentence thereof.

Section Amend § 15-905(a), Chapter 15, Title 6 of the Delaware Code by inserting “or continue” immediately after the word “domesticate” in the first sentence thereof and by inserting “domestic” immediately before the word “continuance” in the second sentence thereof.

Section Amend § 15-905(b), Chapter 15, Title 6 of the Delaware Code by inserting “or continuance” immediately after all nine appearances of the word “domestication” in the first four sentences thereof, by inserting the word “domestic” immediately before “continuance if the partnership’s existence” in the fourth sentence thereof, and by inserting the word “domestic” immediately before “continuance shall state” in the fifth sentence thereof.

Section Amend § 15-905(b)(3), Chapter 15, Title 6 of the Delaware Code by inserting “or continued and the name of the entity or business form formed, incorporated, created or that otherwise comes into being as a consequence of the transfer of the partnership to, or its domestication or continuance in, such foreign jurisdiction” immediately before the “;” at the end of the paragraph thereof.

Section Amend §15-905(b)(4), Chapter 15, Title 6 of the Delaware Code by inserting the word “to” immediately before “or domestication”, by deleting the word “to” immediately after the word “domestication” and substituting in lieu thereof “or continuance in”, and by inserting the word “domestic” immediately after “certificate of transfer and”.

Section Amend § 15-905(b)(7), Chapter 15, Title 6 of the Delaware Code by inserting “or continued” immediately after the word “domesticated” in the second sentence thereof.

Section Amend § 15-905(b)(8), Chapter 15, Title 6 of the Delaware Code by inserting the word “domestic” immediately before both appearances of the word “continuance”.

Section Amend § 15-905(c), Chapter 15, Title 6 of the Delaware Code by inserting “or continuance” immediately after the word “domestication” in the second sentence thereof.

Section Amend § 15-905(d), Chapter 15, Title 6 of the Delaware Code by inserting “or continuance” immediately after all five appearances of the word “domestication” in said subsection and by inserting “and shall not be deemed to constitute a dissolution of such partnership” immediately before the “.” at the end of the second sentence thereof.

Section Amend § 15-905(e), Chapter 15, Title 6 of the Delaware Code by inserting the word “domestic” before all three appearances of the word “continuance” in said subsection, by inserting “or business form” immediately after “and the entity” in the second sentence thereof, and by inserting “or continuance” immediately after the word “domestication” in the second sentence thereof.

Section Amend § 15-905(f), Chapter 15, Title 6 of the Delaware Code by inserting “or continuance” immediately after both appearances of the word “domestication” therein and by inserting “entity or” immediately before both appearances of “business form” therein.

Section Amend § 15-905(g), Chapter 15, Title 6 of the Delaware Code by inserting “or continued” immediately after the first, third, sixth and ninth appearances of the word “domesticated” in said subsection, by inserting “or continued entity or” immediately after the second, eighth and tenth appearances of the word “domesticated” in said subsection, by inserting “and shall constitute a continuation of the existence of such domestic partnership in the form of the transferred or domesticated or continued entity or business form” immediately before the “.” at the end of the first sentence thereof, by inserting “or continuance” immediately after the word “domestication” in said second sentence, by deleting “business form” immediately after the fourth appearance of the word “domesticated” in said subsection and substituting in lieu thereof “or continued entity or business form (and also in the domestic partnership that has transferred, domesticated or continued, if and for so long as such domestic partnership continues its existence as a domestic partnership)”, by deleting “business form” immediately after the fifth appearance of the word “domesticated” in said subsection and substituting in lieu thereof “or continued entity or business form (and also of the domestic partnership that has transferred, domesticated or continued, if and for so long as such domestic partnership continues its existence as a domestic partnership)”, by deleting “business form,” immediately after the seventh appearance of the word “domesticated” in said subsection and substituting in lieu thereof “or continued entity or business form (and also to the domestic partnership that has transferred, domesticated or continued, if and for so long as such domestic partnership continues its existence as a domestic partnership)”, and by inserting “or continuation” immediately after the word “domestication” in the third sentence thereof.

Section Amend Subchapter X of Chapter 15, Title 6 of the Delaware Code by adding thereto, immediately following § 15-1003, a new § 15-1004 reading as follows:

Ҥ 15-1004. Reinstatement of Statement of Qualification or Statement of Foreign Qualification.

(a) A partnership whose statement of qualification or statement of foreign qualification has been canceled pursuant to Section 15-111(d) or Section 15-111(i)(4) of this chapter may apply to the Secretary of State for reinstatement after the effective date of the cancellation. The application must state:

(1) The name of the partnership and the effective date of the cancellation and, if such name is not available at the time of reinstatement, the name under which the statement of qualification or statement of foreign qualification is to be reinstated; and

(2) That the partnership has obtained and designated a new registered agent as required by § 15-111(a) of this chapter and the name and address of such new registered agent and the address of the partnership’s registered office in the State of Delaware.

(b) A cancellation of a partnership’s statement of qualification or statement of foreign qualification pursuant to Section 15-111(d) or Section 15-111(i)(4) of this chapter only affects a partnership’s status as a limited liability partnership or a foreign limited liability partnership and is not an event of dissolution of the partnership.

(c) A reinstatement under subsection (a) relates back to and takes effect as of the effective date of the cancellation, and the partnership’s status as a limited liability partnership or a foreign limited liability partnership continues as if the cancellation had never occurred.”.

Section Amend § 15-1102(b), Chapter 15, Title 6 of the Delaware Code by inserting “, Section 15-111(d) or Section 15-111(i)(4)” immediately after “Section 15-105(d)”.

Section Amend § 15-1210(a), Chapter 15, Title 6 of the Delaware Code by adding “or Section 15-111(i)(4)” immediately after “Section 15-111(d)” in the first sentence thereof.

Section Amend § 15-1210(c), Chapter 15, Title 6 of the Delaware Code by inserting “or Section 15-111(i)(4)” immediately after “Section 15-111(d)” in such subsection.

Section Sections 1 and 4 and Sections 6 through 32 of this Act shall become effective August 1, 2006. Sections 2, 3 and 5 and Sections 33 through 36 of this Act shall become effective January 1, 2007.

Approved July 10, 2006