Delaware Lawmakers Enact Significant Statutory Changes to the State’s Business Entity Laws

Important legislative changes can be found online at the Delaware Business Entity Law Website (http://cscde.lexisnexis.com) and in the Fall 2009 Edition of Delaware Laws Governing Business Entities.

The 2009 Regular Session of the Delaware General Assembly generated a number of significant amendments to the state’s General Corporation Law and to its alternative entity statutes.  Among these were changes increasing many of the fees and other amounts payable by business entities under Delaware law. The revisions generally became effective on August 1, 2009.

“Delaware’s business laws are reviewed regularly and revised periodically to keep them up to date, and the state’s lawmakers have demonstrated their continuing attentiveness to Delaware’s business entity statutes by enacting various amendments to those laws,” explains Robert L. Symonds, a shareholder in the Wilmington, Delaware office of Stevens & Lee and a Senior Legal Advisor to CSC® Media.

Noteworthy statutory revisions made to Delaware’s General Corporation Law address proxy access and reimbursement of proxy expenses. Other amendments touch on “empty voting” issues, judicial removal of directors, indemnification and advancement rights, and amounts payable to the Delaware Secretary of State.

On the alternative entity side, statutory amendments were enacted to clarify the application of the doctrine of independent legal significance in the alternative entity context, clarify the subject matter jurisdiction of the Delaware Court of Chancery, address the execution of certificates filed with the Delaware Secretary of State, and facilitate a change of the registered agent or registered office of a Delaware partnership, limited partnership, or limited liability company that is the surviving entity in a merger.

A number of the statutory revisions passed by Delaware lawmakers increase the fees and taxes payable to the Delaware Secretary of State for corporations and alternative entities. The most prominent of the amendments to the General Corporation Law raises the maximum annual franchise tax from $165,000 to $180,000. (The annual taxes payable under the state’s alternative entities laws are unchanged.)

Delaware Laws Governing Business Entities Fall 2009 Edition provides users with legislative changes in print and online

“While some of these statutory updates are largely technical adjustments, others are substantive, and have real significance for legal professionals who do business in the state of Delaware,” says CSC Media Director Andrea Unterberger. “It’s important that practitioners have a resource that provides them with this information in a format that is up-to-date, comprehensive, and easy to use.”

The Fall 2009 Edition of Delaware Laws Governing Business Entities, slated for release next month, contains these changes, including a chapter on amounts payable by business entities under Delaware law. The book also features in-depth analyses of the statutory revisions and their significance prepared by CSC’s Senior Legal Advisors, Matthew J. O’Toole and Robert L. Symonds, Jr.

The new edition also includes over 100 new case annotations from Delaware state courts and from courts in other jurisdictions that apply Delaware business entity law. Volume 2 also contains the full text of five recent cases, including Berger, which examines short form mergers and remedies for minority shareholders, as well as Lyondell, in which the Delaware Supreme Court overturns the Chancery Court’s controversial decision regarding the duty of loyalty and good faith on the part of independent directors.

 The latest legislative developments and all of the other content and features found in Delaware Laws Governing Business Entities are also available online at the Delaware Business Entity Law website at http://cscde.lexisnexis.com/. This website includes Volumes 1 and 2 in a fully searchable format, plus links to statutes, case annotations and opinions, as well as annotated forms for Delaware business transactions, sample bylaws and operating agreements.

Online users can create electronic bookmarks and take notes anywhere on the site, and print, email and export search results. Also, the website is browser-based, so users can access it simply by logging on from any computer.

“The website gives you fast access to the current statutes, case annotations, statutory revisions, fee changes and all the other business entity law information that you need, right on your desktop,” Unterberger explains. “And if you can’t find something you’re looking for, or you need clarification on an issue, let us know by sending an email to aunterbe@cscinfo.com. We are committed to providing you with the information you need, when you need it, and in the format of your choice.”