What is a Section 220 demand?

What is a Section 220 demand?

Section 220 of the DGCL provides stockholders and directors with an invaluable resource to inspect a corporation’s books and records or stockholder list, and can serve useful purposes such as valuing a stockholder’s interest, communicating with other shareholders before an election of directors, investigating corporate …

What is a 228 E notice?

Section 228(e) of the [Delaware General Corporation Law (“DGCL”)] requires that when corporate action is taken “without a meeting by less than unanimous consent,” the stockholders who did not consent must receive “[p]rompt notice.” “Prompt notice to the minority stockholders is of critical importance.” That is because …

What actions require shareholder approval under Delaware law?

Stockholder Approval Required to: Amend the Certificate of Incorporation. Enter into fundamental corporate transactions (sale of company, merger, sale of substantially all assets of corporation, etc.) Elect Directors (though vacant seats from departed directors can often be filled by Board)

Is a Delaware corporation required to have an annual meeting?

Delaware law requires that a “meeting of stockholders” of a corporation must happen every year (or technically every 13 months under Delaware law). According to Delaware law, the reason for the annual meeting is to elect directors and transact “Any other proper business”.

How do I amend a certificate of incorporation in Delaware?

To make amendments to your Delaware Stock Corporation, you submit the completed State of Delaware Certificate of Amendment of Certificate of Incorporation form to the Department of State by mail, fax or in person, along with the filing fee and the Filing Cover Memo. Non-stock corporations use a separate amendment form.

Can a directors sell a company without shareholder approval?

A director cannot enter into a contract to acquire anything of substance from the company, or to sell anything of substance to the company, unless shareholders have first approved the deal by passing an ordinary resolution, or the contract is conditional on getting that approval.

Can a Delaware corporation have no directors?

If at any time, by reason of death or resignation or other cause, a corporation should have no directors in office, then any officer or any stockholder or an executor, administrator, trustee or guardian of a stockholder, or other fiduciary entrusted with like responsibility for the person or estate of a stockholder.

Does Delaware require meeting minutes?

While Texas requires its corporations to keep regular meeting minutes, Delaware does not. These minutes do not need to be filed with the state, but they should be kept with your corporate records.

What is a section 220 action in Delaware law?

Section 220 of the Delaware General Corporation Law (“DGCL”) provides the means by which a stockholder can make a demand for the books and records of a Delaware corporation. The long-favored approach under Delaware law is for a plaintiff to file a Section 220 action as an investigatory tool prior to commencing litigation.

Can a stockholder make a demand for books and Records in Delaware?

Books and Records Demand. Section 220 of the Delaware General Corporation Law (“DGCL”) provides the means by which a stockholder can make a demand for the books and records of a Delaware corporation. The long-favored approach under Delaware law is for a plaintiff to file a Section 220 action as an investigatory tool prior to commencing litigation.

Who is a stockholder in Delaware Code Title 8?

Delaware Code Title 8. Corporations § 220. Inspection of books and records (a) As used in this section: (1) “ Stockholder ” means a holder of record of stock in a stock corporation, or a person who is the beneficial owner of shares of such stock held either in a voting trust or by a nominee on behalf of such person.

What is a “proper purpose” for a section 220 action?

To properly commence a Section 220 action to inspect a corporation’s books and records, a “stockholder” must make a demand in writing, under oath, and assert a “proper purpose.” 8 Del. C. § 220.