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SPONSOR: Sen. Brown & Sen. Townsend & Sen. Pettyjohn &
Rep. Bush & Rep. Griffith
Sens. Hoffner, Mantzavinos, Paradee
DELAWARE STATE SENATE
153rd GENERAL ASSEMBLY
SENATE BILL NO. 95
AN ACT TO AMEND TITLE 8 OF THE DELAWARE CODE RELATING TO THE GENERAL CORPORATION LAW.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF DELAWARE (Two-thirds of all members
elected to each house thereof concurring therein):
1 Section 1. Amend § 102, Title 8 of the Delaware Code by making deletions as shown by strike through and
2 insertions as shown by underline as follows:
3 § 102. Contents of certificate of incorporation.
4 (f) The certificate of incorporation may not contain any provision that would impose liability on a stockholder for
5 the attorneys’ fees or expenses of the corporation or any other party in connection with an internal corporate claim, as
6 defined in § 115 of this title. title, or in connection with any other claim that a stockholder, acting in its capacity as a
7 stockholder or in the right of the corporation, has brought in an action, suit or proceeding.
8 Section 2. Amend § 103, Title 8 of the Delaware Code by making deletions as shown by strike through and
9 insertions as shown by underline as follows:
10 § 103. Execution, acknowledgment, filing, recording and effective date of original certificate of incorporation and
11 other instruments; exceptions.
12 (f) Whenever any instrument authorized to be filed with the Secretary of State under any provision of this title, has
13 been so filed and is an inaccurate record of the corporate action therein referred to, or was defectively or erroneously
14 executed, sealed or acknowledged, the instrument may be corrected or nullified by filing with the Secretary of State a
15 certificate of correction of the instrument which shall be executed, acknowledged and filed in accordance with this section.
16 The If the instrument is to be corrected, the certificate of correction shall specify the inaccuracy or defect to be corrected
17 and shall set forth the portion of the instrument in corrected form. If the instrument is to be nullified, the certificate of
18 correction shall specify the inaccuracy or defect with respect to the instrument and shall provide for the nullification of the
19 instrument. In lieu of filing a certificate of correction the instrument may be corrected by filing with the Secretary of State a
20 corrected instrument which shall be executed, acknowledged and filed in accordance with this section. The corrected
21 instrument shall be specifically designated as such in its heading, shall specify the inaccuracy or defect to be corrected, and
22 shall set forth the entire instrument in corrected form. An instrument corrected or nullified in accordance with this section
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23 shall be effective as of the date the original instrument was filed, except as to those persons who are substantially and
24 adversely affected by the correction or nullification and as to those persons the instrument as corrected or nullified shall be
25 effective from the filing date.
26 Section 3. Amend § 109, Title 8 of the Delaware Code by making deletions as shown by strike through and
27 insertions as shown by underline as follows:
28 § 109. Bylaws.
29 (b) The bylaws may contain any provision, not inconsistent with law or with the certificate of incorporation,
30 relating to the business of the corporation, the conduct of its affairs, and its rights or powers or the rights or powers of its
31 stockholders, directors, officers or employees. The bylaws may not contain any provision that would impose liability on a
32 stockholder for the attorneys’ fees or expenses of the corporation or any other party in connection with an internal corporate
33 claim, as defined in § 115 of this title. title, or in connection with any other claim that a stockholder, acting in its capacity
34 as a stockholder or in the right of the corporation, has brought in an action, suit or proceeding.
35 Section 4. Amend § 115, Title 8 of the Delaware Code by making deletions as shown by strike through and
36 insertions as shown by underline as follows:
37 § 115. Forum selection provisions.
38 (a) The certificate of incorporation or the bylaws may require, consistent with applicable jurisdictional
39 requirements, that any or all internal corporate claims shall be brought solely and exclusively in any or all of the courts in
40 this State, and no provision of the certificate of incorporation or the bylaws may prohibit bringing such claims in the courts
41 of this State.
42 (b) “Internal corporate claims” means claims, including claims in the right of the corporation, (i) that are based
43 upon a violation of a duty by a current or former director or officer or stockholder in such capacity, or (ii) as to which this
44 title confers jurisdiction upon the Court of Chancery.
45 (c) With respect to claims that are not internal corporate claims, the certificate of incorporation or bylaws may
46 require stockholders, when acting in their capacity as stockholders or in the right of the corporation, to bring any or all such
47 claims only in 1 or more prescribed forums or venues, if such claims relate to the business of the corporation, the conduct
48 of its affairs, or the rights or powers of the corporation or its stockholders, directors or officers; provided that such
49 requirement is consistent with applicable jurisdictional requirements and allows a stockholder to bring such claims in at
50 least 1 court in this State that has jurisdiction over such claims.
51 Section 5. Amend § 131, Title 8 of the Delaware Code by making deletions as shown by strike through and
52 insertions as shown by underline as follows:
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53 § 131. Registered office in State; principal office or place of business in State. State.
54 (a) Every corporation shall have and maintain in this State a registered office which may, but need not be, the
55 same as its a place of business. the corporation’s business in this State.
56 (b) Whenever the term “corporation’s principal office or place of business in this State” or “principal office or
57 place of business of the corporation in this State,” or other term of like import, is or has been used in a corporation’s
58 certificate of incorporation, or in any other document, or in any statute, it shall be deemed to mean and refer to, unless the
59 context indicates otherwise, the corporation’s registered office required by this section; and it shall not be necessary for any
60 corporation to amend its certificate of incorporation or any other document to comply with this section. As used in this title,
61 “registered office” means the address of the registered agent located in this State being appointed to accept service of
62 process and otherwise perform the duties of a registered agent.
63 Section 6. Amend § 132, Title 8 of the Delaware Code by making deletions as shown by strike through and
64 insertions as shown by underline as follows:
65 § 132. Registered agent in State; resident agent.
66 (b)(1) Every registered agent for a domestic corporation or a foreign corporation shall:
67 (1)a. If an entity, maintain a business office in this State which is generally open, or if an individual, be
68 generally present at a designated location in this State, at sufficiently frequent times to accept service of process
69 and otherwise perform the functions of a registered agent;
70 (2)b. If a foreign entity, be authorized to transact business in this State;
71 (3)c. Accept service of process and other communications directed to the corporations for which it serves
72 as registered agent and forward same to the corporation to which the service or communication is directed;
73 (4)d. Forward to the corporations for which it serves as registered agent the annual report required by §
74 502 of this title or an electronic notification of same in a form satisfactory to the Secretary of State (“Secretary”);
75 and
76 (5)e. Satisfy and adhere to regulations established by the Secretary regarding the verification of both the
77 identity of the entity’s contacts and individuals for which the registered agent maintains a record for the reduction
78 of risk of unlawful business purposes.
79 (2) A registered agent may not perform its duties or functions solely through the use of a virtual office, the
80 retention by the agent of a mail forwarding service, or both. For purposes of this paragraph (b)(2), “virtual office”
81 means the performance of duties or functions solely through the internet or solely through other means of remote
82 communication.
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83 Section 7. Amend § 155, Title 8 of the Delaware Code by making deletions as shown by strike through and
84 insertions as shown by underline as follows:
85 § 155. Fractions of shares.
86 A corporation may, but shall not be required to, issue fractions of a share. If it does not issue fractions of a share, it
87 shall (1) arrange for the disposition of fractional interests by those entitled thereto, (2) pay in cash the fair value of fractions
88 of a share as of the time when those entitled to receive such fractions are determined or (3) issue scrip or warrants in
89 registered form (either represented by a certificate or uncertificated) or in bearer form (represented by a certificate) which
90 shall entitle the holder to receive a full share upon the surrender of such scrip or warrants aggregating a full share. A
91 certificate for a fractional share or an uncertificated fractional share shall, but scrip or warrants shall not unless otherwise
92 provided therein, entitle the holder to exercise voting rights, to receive dividends thereon and to participate in any of the
93 assets of the corporation in the event of liquidation. The board of directors may cause scrip or warrants to be issued subject
94 to the conditions that they shall become void if not exchanged for certificates representing the full shares or uncertificated
95 full shares before a specified date, or subject to the conditions that the shares for which scrip or warrants are exchangeable
96 may be sold by the corporation and the proceeds thereof distributed to the holders of scrip or warrants, or subject to any
97 other conditions which the board of directors may impose.
98 Section 8. Amend § 252, Title 8 of the Delaware Code by making deletions as shown by strike through and
99 insertions as shown by underline as follows:
100 § 252. Merger or consolidation of domestic and foreign corporations; service of process upon surviving or
101 resulting corporation.
102 (c) The agreement shall be adopted, approved, certified, executed and acknowledged by each of the constituent
103 corporations in accordance with the laws under which it is organized, and, in the case of a corporation of this State, in the
104 same manner as is provided in § 251 of this title. The agreement shall be filed and shall become effective for all purposes of
105 the laws of this State when and as provided in § 251 of this title with respect to the merger or consolidation of corporations
106 of this State. In lieu of filing the agreement of merger or consolidation, the surviving or resulting corporation may file a
107 certificate of merger or consolidation, executed in accordance with § 103 of this title, which states:
108 (7) That a copy of the agreement of consolidation or merger will be furnished by the surviving or resulting
109 corporation, on request and without cost, to any stockholder of any constituent corporation; and
110 (8) If the corporation surviving or resulting from the merger or consolidation is a corporation of this State, the
111 authorized capital stock of each constituent corporation which is not a corporation of this State; and [Repealed.]
112 (9) The agreement, if any, required by subsection (d) of this section.
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113 Section 9. Amend § 311, Title 8 of the Delaware Code by making deletions as shown by strike through and
114 insertions as shown by underline as follows:
115 § 311. Revocation of voluntary dissolution; restoration of expired certificate of incorporation.
116 (a) At any time prior to the expiration of 3 years following the dissolution of a corporation pursuant to § 275 of
117 this title or such longer period as the Court of Chancery may have directed pursuant to § 278 of this title, or at any time
118 prior to the expiration of 3 years following the expiration of the time limited for the corporation’s existence as provided in
119 its certificate of incorporation or such longer period as the Court of Chancery may have directed pursuant to § 278 of this
120 title, a corporation may revoke the dissolution theretofore effected by it or restore its certificate of incorporation after it has
121 expired by its own limitation in the following manner:
122 (4) At the meeting a vote of the stockholders shall be taken on a resolution to revoke the dissolution in the
123 case of a dissolution or to restore the certificate of incorporation in the case of an expiration by limitation. If a majority
124 of the stock of the corporation which was outstanding and entitled to vote upon a dissolution at the time of its
125 dissolution, in the case of a revocation of dissolution, or which was outstanding and entitled to vote upon an
126 amendment to the certificate of incorporation to change the period of the corporation’s duration at the time of its
127 expiration by limitation, in the case of a restoration, shall be voted for the resolution, a certificate of revocation of
128 dissolution or a certificate of restoration shall be executed, acknowledged and filed in accordance with § 103 of this
129 title, which shall be specifically designated as a certificate of revocation of dissolution or a certificate of restoration in
130 its heading and shall state:
131 a. The name of the corporation;
132 b. The address (which shall be stated in accordance with § 131(c) of this title) of the corporation’s
133 registered office in this State, and the name of its registered agent at such address;
134 c. The names and respective addresses of its officers;
135 d. The names and respective addresses of its directors;
136 e. The date of filing of the corporation’s original certificate of incorporation with the Secretary of State;
137 f. The date of filing of the corporation’s certificate of dissolution with the Secretary of State;
138 e. g. That a majority of the stock of the corporation which was outstanding and entitled to vote upon a
139 dissolution at the time of its dissolution have voted in favor of a resolution to revoke the dissolution, in the case of
140 a revocation of dissolution, or that a majority of the stock of the corporation which was outstanding and entitled to
141 vote upon an amendment to the certificate of incorporation to change the period of the corporation’s duration at
142 the time of its expiration by limitation, in the case of a restoration, have voted in favor of a resolution to restore the
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143 certificate of incorporation; or, if it be the fact, that, in lieu of a meeting and vote of stockholders, the stockholders
144 have given their written consent to the revocation or restoration in accordance with § 228 of this title; and
145 f. h. In the case of a restoration, the new specified date limiting the duration of the corporation’s existence
146 or that the corporation shall have perpetual existence.
147 Section 10. Amend § 312, Title 8 of the Delaware Code by making deletions as shown by strike through and
148 insertions as shown by underline as follows:
149 § 312. Revival of certificate of incorporation.
150 (g) Any corporation that revives its certificate of incorporation under this chapter shall pay to this State a sum
151 equal to all franchise taxes, penalties and interest thereon due at the time its certificate of incorporation became forfeited or
152 void pursuant to this title; provided, however, that any corporation that revives its certificate of incorporation under this
153 chapter whose certificate of incorporation has been forfeited or void for more than 5 years shall, in lieu of the payment of
154 the franchise taxes and penalties otherwise required by this subsection, pay a sum equal to 3 times the amount of the annual
155 franchise tax that would be due and payable by such corporation for the year in which the revival is effected, computed at
156 the then current rate of taxation. No payment made pursuant to this subsection shall reduce the amount of franchise tax due
157 under Chapter 5 of this title for the year in which the revival is effected. If the filing of a certificate of validation under §
158 204 of this title relates to a time during which the corporation’s certificate of incorporation had been forfeited or void, the
159 annual reports and annual franchise taxes that would have been required to be filed and paid during the period in which the
160 corporation’s certificate of incorporation had been forfeited or void, including interest thereon, are required to be filed and
161 paid at the time of the filing of such certificate of validation.
162 Section 11. Amend § 377, Title 8 of the Delaware Code by making deletions as shown by strike through and
163 insertions as shown by underline as follows:
164 § 377. Change of registered agent. agent; reinstatement of qualification to do business.
165 (e) Upon the filing of a certificate of reinstatement in accordance with subsection (d) of this section, and the filing
166 of all annual reports and the payment of all required fees that would have been required to be filed and paid during the time
167 the foreign corporation’s qualification to do business in this State had been forfeited, the qualification of the foreign
168 corporation to do business in this State shall be reinstated with the same force and effect as if it had not been forfeited
169 pursuant to this title.
170 Section 12. Amend § 502, Title 8 of the Delaware Code by making deletions as shown by strike through and
171 insertions as shown by underline as follows:
172 § 502. Annual franchise tax report; contents; failure to file and pay tax; duties of Secretary of State.
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173 (a) Annually on or before March 1, every corporation now existing or hereafter incorporated under Chapter 1 of
174 this title or which has accepted the Constitution of this State, shall make an annual franchise tax report to the Secretary of
175 State. The report shall be made on a form designated by the Secretary of State and shall be signed by the corporation’s
176 president, secretary, treasurer or other proper officer duly authorized so to act, or by any of its directors, or if filing an
177 initial report by any incorporator in the event its board of directors shall not have been elected. The fact that an individual’s
178 name is signed on the report shall be prima facie evidence that such individual is authorized to certify the report on behalf
179 of the corporation; however, the official title or position of the individual signing the corporate report shall be designated.
180 The report shall contain the following information:
181 (1) The location of its registered office in this State, which shall include the street, number, city and postal
182 code;
183 (2) The name of the agent upon whom service of process against the corporation may be served;
184 (3) The nature of the business of the corporation;
185 (3)(4) The location of the principal place of business of the corporation, which shall include the street,
186 number, city, state or foreign country (provided that, unless a corporation maintains its principal place of business in
187 this State and serves as its own registered agent, for purposes of this subsection, the principal place of business address
188 shall not be the address of the registered office of the corporation in this State); State and shall not be the address of
189 any other registered agent);
190 (4)(5) The names and addresses of all the directors as of the filing date of the report and the name and address
191 of the officer who signs the report; provided, that other than an initial report, all reports shall list a director or directors
192 excepting any report filed in conjunction with a certificate of dissolution filed by an incorporator pursuant to § 274 of
193 this title or a certificate of dissolution filed pursuant to § 275(c) of this title;
194 (5)(6) The number of shares and the par value per share of each class of capital stock having a par value and
195 the number of shares of each class of stock without par value which the corporation is authorized to issue; and
196 (6) [Repealed.]
197 (7) Such additional information, schedules and attachments as the Secretary shall require to ascertain the
198 franchise tax due to the State.
199 Section 13. Amend § 503, Title 8 of the Delaware Code by making deletions as shown by strike through and
200 insertions as shown by underline as follows:
201 § 503. Rates and computation of franchise tax.
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202 (e) In case a corporation shall have changed during the taxable year the amount of its authorized capital stock, the
203 total annual franchise tax payable at the foregoing rates shall be arrived at by adding together the franchise taxes calculated
204 as above set forth as prorated for the several periods of the year during which each distinct authorized amount of capital
205 stock was in effect. The filing of a certificate of validation pursuant to under § 204 of this title shall not reduce the annual
206 franchise tax and interest due for any period prior to the filing of such certificate of validation validation, and shall not
207 entitle the corporation to a refund, and any calculation of additional annual franchise tax and interest due for any period
208 prior to the filing of such certificate of validation shall be calculated at the current rates in effect pursuant to under this
209 section.
210 (h) All corporations as defined in this section which are regulated investment companies as defined by § 851 of the
211 federal Internal Revenue Code [26 U.S.C. § 851], shall pay to the Secretary of State as an annual franchise tax, a tax
212 computed either under paragraph (a)(1) or (a)(2) of this section, or a tax at the rate of $400 per annum for each $1,000,000,
213 or fraction thereof in excess of $1,000,000, of the average gross assets thereof during the taxable year, whichever be the
214 least, provided that in no case shall the tax on any corporation for a full taxable year under this subsection be more than
215 $100,000. The average assets for the purposes of this section shall be taken to be the mean of the gross assets on January 1
216 and December 31 of the taxable year. Any corporation electing to pay a tax under this subsection shall show on its annual
217 franchise tax report that the corporation is a regulated investment company as above defined, and the amount of its assets
218 on January 1 and December 31 of the taxable year, and the mean thereof. The Secretary of State may investigate the facts
219 set forth in the report and if it should be found that the corporation so electing to pay under this subsection shall not be a
220 regulated investment company, as above defined, shall assess upon the corporation a tax under paragraphs (a)(1) and (a)(2)
221 of this section, whichever be the lesser.[Repealed.]
222 Section 14. Amend § 505, Title 8 of the Delaware Code by making deletions as shown by strike through and
223 insertions as shown by underline as follows:
224 § 505. Review and refund; jurisdiction and power of the Secretary of State; appeal.
225 (a) If any corporation claims that the annual franchise tax or any penalties or interest were erroneously or illegally
226 fixed or paid with respect to a calendar year, the corporation may, not later than March 1 of the second calendar year
227 following the close of such calendar year, petition the Secretary of State for a reduction or refund of such tax, penalties or
228 interest. No refund shall be granted in connection with the filing of a certificate of correction under § 103(f) of this title or
229 the filing of a certificate of validation under § 204 of this title.
230 Section 15. Sections 1 through 12 and Section 14 of this Act take effect on August 1, 2025.
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231 Section 16. Section 503(h) of Title 8, as contained in Section 13 of this Act, takes effect for tax years beginning on
232 or after January 1, 2026. Section 503(e) of Title 8, as contained in Section 13 of this Act, takes effect on August 1, 2025.
SYNOPSIS
This Act continues the practice of amending periodically the Delaware General Corporation Law (“DGCL”) to
keep it current and maintain its national preeminence. The following is a section-by-section review of the proposed
amendments to the DGCL.
Sections 1, 3 and 4 of this Act amend §§ 102(f), 109(b) and 115 of Title 8, respectively. Since 2015, the provisions
of §§ 102(f), 109(b) and 115 have included provisions for the regulation of “internal corporate claims” as defined in § 115.
In addition to permitting forum selection provisions that require internal corporate claims to be adjudicated in a court in this
State, these sections prohibit certificate of incorporation and bylaw provisions that purport to:
a. impose “fee-shifting” against stockholders with respect to internal corporate claims; or
b. preclude a stockholder from asserting an internal corporate claim in a court in this State.
A certificate of incorporation may address and regulate not only internal corporate claims but additional claims
that relate to a corporation’s “intra-corporate affairs” if the certificate provision at issue is consistent with public policy.
Salzberg v. Sciabacucchi, 227 A.3d 102 (Del. 2020).
Sections 1, 3 and 4 of this Act amend §§ 102(f), 109(b) and 115 so that the same statutory safeguards that apply to
certificate and bylaw provisions regulating internal corporate claims will also apply to certificate and bylaw provisions
addressing the intra-corporate affairs claims permitted under the reasoning of the Salzberg decision. With respect to these
claims:
a. Amended §§ 102(f) and 109(b) prohibit fee-shifting provisions: that is, certificate of incorporation and bylaw
provisions that purport to impose liability on a stockholder for the attorneys’ fees or expenses of the corporation or any
other party with respect to any claim that a stockholder has brought, in its capacity as a stockholder or in the right of the
corporation, in an action, suit, or proceeding.
b. Amended § 115 specifies that a certificate of incorporation or bylaw provision addressing intra-corporate affairs
claims must be consistent with applicable jurisdictional requirements and must allow stockholders to bring the claims in at
least 1 court in this State that has jurisdiction over such claims. Amended § 115 permits the designation of any judicial or
arbitral forum so long as the designation does not prevent a stockholder from bringing claims in a court with jurisdiction in
this State. The United States District Court for the District of Delaware is a court “in” this State for purposes of amended §
115.
Rather than specifically defining the types of non-internal claims that constitute intra-corporate affairs claims,
amended § 115 authorizes forum selection provisions that relate to “the business of the corporation, the conduct of its
affairs, or the rights or powers of the corporation or its stockholders, directors or officers.” This language is taken from §§
102(b)(1) and 109(b). The Salzberg decision relied on similar language from § 102(b)(1) to uphold the validity of forum
selection provisions related to certain intra-corporate affairs claims. It is anticipated that the courts will interpret and apply
amended § 115 in the same manner that the Delaware Supreme Court interpreted and applied the language of § 102(b)(1) in
the Salzberg decision. Amended § 115 is not intended to promote the development of new forum selection provisions
beyond what is permitted under the reasoning of the Salzberg decision.
Under amended § 115, a forum selection provision addressing non-internal corporate claims cannot prohibit claims
from being brought in a court in this State “that has jurisdiction over such claims.” Amended § 115 therefore reaches a
result different from the United States Court of Appeals for the Ninth Circuit in Lee v. Fisher, 70 F.4th 1129 (9th Cir.
2023), and the United States District Court for the Western District of Texas in Sobel v. Thompson, 2023 WL 4356066
(W.D. Tex. July 5, 2023). In these decisions, the courts upheld the application of a forum selection bylaw that required all
derivative claims to be asserted exclusively in the Court of Chancery, including derivative claims under the Securities
Exchange Act of 1934. However, the Court of Chancery does not have jurisdiction over Securities Exchange Act claims.
Under amended § 115, a forum selection provision that purports to address derivative claims under federal law must be
permissible under § 115, consistent with the reasoning in the Salzberg decision, and must also permit the claim to be
brought in the United States District Court for the District of Delaware.
Consistent with the provisions pre-dating these amendments:
a. Amended §§ 102(f), 109(b) and 115 are not intended to prevent the application of a provision on fee-shifting, or
the selection of a forum other than a court in this State, if the provision is included in a stockholder agreement or other
writing signed by the stockholder against whom the provision is to be enforced;
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b. Amended § 115 is not intended to foreclose evaluation of whether the specific terms and manner of adoption of
a particular provision authorized by amended § 115 comport with any relevant fiduciary obligation or operate reasonably in
the circumstances; and
c. Amended § 115 is not intended to limit or expand the jurisdiction of the Court of Chancery or the Superior
Court.
Section 2 of this Act amends § 103(f), which provides for the correction of instruments filed with the Secretary of
State. The amendment confirms that, in addition to correcting a previously filed instrument, a certificate of correction may
nullify a previously filed instrument by specifying the inaccuracy or defect with respect to such previously filed instrument
and providing that the previously filed instrument is nullified. A statement that the previously filed instrument is nullified
or void, or a statement with words of similar meaning, will constitute sufficient provision for the nullification.
Section 5 of this Act amends § 131, which requires a corporation to have a registered office in this State. In
addition to enacting wording changes to § 131(a), the amendments to § 131(b) provide that all references in Title 8 to a
corporation’s “registered office” in this State shall be deemed to mean and refer to the address of the registered agent
located in this State that has been appointed to accept service of process and otherwise perform the duties of a registered
agent. The amendments also delete the provisions in § 131(b) that, in certain instances, deemed a corporation’s registered
office to be the corporation’s principal office or principal place of business in this State for purposes of Title 8 and the
certificate of incorporation. As amended, Title 8 does not include provisions that automatically treat a corporation’s
registered office as a principal office or principal place of business of the corporation.
Section 6 of this Act amends § 132(b), which addresses certain duties of a registered agent of a corporation.
Amended § 132(b) specifies that a registered agent may not perform its duties or functions solely through the use of either
or both of a virtual office or the retention by the agent of a mail forwarding service. Amended § 132(b) defines “virtual
office” as the performance of duties or functions solely through the internet or solely through other means of remote
communication.
Section 7 of this Act amends § 155 to eliminate the ability of a corporation to issue scrip or warrants in bearer
form in lieu of issuing fractional shares of stock. Amended § 155 continues to permit corporations to issue scrip or warrants
in registered form. The amendment is intended to bring § 155 in line with the Corporate Transparency Act, 31 U.S.C. §
5336(f), which prohibits corporations from issuing certificates in bearer form for either a whole or fractional interest in an
entity.
Section 8 of this Act amends § 252(c), which lists the information that a corporation must include in a certificate
filed with the Secretary of State to merge or consolidate domestic corporations with foreign corporations. The amendments
delete from § 252(c) a requirement that a certificate of merger or consolidation list the authorized capital stock of each
foreign corporation that has ceased to exist as a result of the merger or consolidation.
Section 9 of this Act amends § 311, which addresses the procedures for revoking the dissolution of a corporation
and restoring an expired corporation. Amended § 311(a)(4) requires that a certificate of revocation of dissolution or
certificate of restoration state the date of filing of the corporation’s original certificate of incorporation with the Secretary of
State and state the date of filing of the corporation’s certificate of dissolution with the Secretary of State.
Section 10 of this Act amends § 312, which enables a corporation to revive its certificate of incorporation after the
certificate has become forfeited or void. Amended § 312(g) addresses circumstances where a corporation has been revived
under § 312 and later files a certificate of validation under § 204 to ratify one or more defective corporate acts. If the
certificate of validation relates to a time during which the corporation was forfeited or void, amended § 312(g) requires the
corporation to file the annual franchise tax reports, and pay the annual franchise taxes, that would have been required to be
filed, and paid, during the period that the certificate of incorporation had been forfeited or void. The franchise taxes owed
include the interest accrued on the taxes, and the filings and payments must be made at the time the certificate of validation
is filed.
Section 11 of this Act amends § 377. Among other things, § 377 addresses the procedures that a foreign
corporation must follow to reinstate its qualification to do business in this State after the qualification has been forfeited
under § 132 or § 136. In connection with such a reinstatement, amended § 377(e) requires a foreign corporation to file all
annual reports and pay all required fees that would have been required to be filed or paid during the time the foreign
corporation’s qualification to do business in this State had been forfeited.
Section 12 of this Act amends § 502, which requires a corporation to file an annual report with the Secretary of
State. Amended § 502(a) requires that the report disclose the nature of the business of the corporation and confirms that no
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office of any registered agent may be disclosed as the address of the principal place of business of the corporation, except
where the corporation maintains its principal place of business in this State and serves as its own registered agent. The
paragraphs of amended § 502(a) have also been re-numbered.
Section 13 of this Act amends § 503, which provides the rates and means of computing franchise taxes. Amended
§ 503(e) provides that the filing of a certificate of validation to ratify one or more defective corporate acts pursuant to § 204
will not reduce the interest owed on the franchise taxes owed for prior periods and specifies that a corporation is not entitled
to a franchise tax refund for any period prior to the filing of the certificate of validation. The amendments also repeal §
503(h), which specified an alternative franchise tax rate for regulated investment companies.
Section 14 of this Act amends § 505 by clarifying that a corporation is not entitled to a refund of taxes, penalties or
interest in connection with filing a certificate of correction under § 103(f) or a certificate of validation under § 204.
Section 15 of this Act provides that Sections 1 through 12 and Section 14 of this Act take effect on August 1,
2025.
Section 16 of this Act provides that § 503(h), as contained in Section 13 of this Act, takes effect for tax years
beginning on or after January 1, 2026. Section 16 of this Act also provides that § 503(e), as contained in Section 13 of this
Act, takes effect on August 1, 2025.
This Act requires a greater than majority vote for passage because § 1 of Article IX of the Delaware Constitution
requires the affirmative vote of two-thirds of the members elected to each house of the General Assembly to amend the
general corporation law.
Author: Senator Brown
DLS : MJC : AF Page 11 of 11 Released: 04/08/2025 12:47 PM
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