Delaware – General Corporation Law – Domestication and Transfer

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§ 388. | § 389. | § 390.

Corporations

CHAPTER 1. GENERAL CORPORATION LAW

Subchapter XVI. Domestication and Transfer

§ 388. Domestication of non-United States entities.

(a) As used in this section, the term:

(1) “Foreign jurisdiction” means any
foreign country or other foreign jurisdiction (other than the United
States, any state, the District of Columbia, or any possession or
territory of the United States); and

(2) “Non-United States entity” means a
corporation, a limited liability company, a statutory trust, a business
trust or association, a real estate investment trust, a common-law
trust, or any other unincorporated business or entity, including a
partnership (whether general (including a limited liability
partnership) or limited (including a limited liability limited
partnership)), formed, incorporated, created or that otherwise came
into being under the laws of any foreign jurisdiction.

(b) Any non-United States entity may
become domesticated as a corporation in this State by complying with
subsection (h) of this section and filing with the Secretary of State:

(1) A certificate of corporate
domestication which shall be executed in accordance with subsection (g)
of this section and filed in accordance with § 103 of this title; and

(2) A certificate of incorporation, which shall be executed, acknowledged and filed in accordance with § 103 of this title.

(c) The certificate of corporate domestication shall certify:

(1) The date on which and jurisdiction
where the non-United States entity was first formed, incorporated,
created or otherwise came into being;

(2) The name of the non-United States entity immediately prior to the filing of the certificate of corporate domestication;

(3) The name of the corporation as set
forth in its certificate of incorporation filed in accordance with
subsection (b) of this section; and

(4) The jurisdiction that constituted the
seat, siege social, or principal place of business or central
administration of the non-United States entity or any other equivalent
thereto under applicable law, immediately prior to the filing of the
certificate of corporate domestication; and

(5) 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.

(d) Upon the certificate of corporate
domestication and the certificate of incorporation becoming effective
in accordance with § 103 of this title, the non-United States entity
shall be domesticated as a corporation in this State and the
corporation shall thereafter be subject to all of the provisions of
this title, except that notwithstanding § 106 of this title, the
existence of the corporation shall be deemed to have commenced on the
date the non-United States entity commenced its existence in the
jurisdiction in which the non-United States entity was first formed,
incorporated, created or otherwise came into being.

(e) The domestication of any non-United
States entity as a corporation in this State shall not be deemed to
affect any obligations or liabilities of the non-United States entity
incurred prior to its domestication as a corporation in this State, or
the personal liability of any person therefor.

(f) The filing of a certificate of
corporate domestication shall not affect the choice of law applicable
to the non-United States entity, except that, from the effective time
of the domestication, the law of the State of Delaware, including this
title, shall apply to the non-United States entity to the same extent
as if the non-United States entity had been incorporated as a
corporation of this State on that date.

(g) The certificate of corporate
domestication shall be signed by any person who is authorized to sign
the certificate of corporate domestication on behalf of the non-United
States entity.

(h) Prior to the filing of a certificate
of corporate domestication with the Secretary of State, the
domestication shall be 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, and the certificate of incorporation shall be approved by
the same authorization required to approve the domestication.

(i) When a non-United States entity has
become domesticated as a corporation pursuant to this section, for all
purposes of the laws of the State of Delaware, the corporation shall be
deemed to be the same entity as the domesticating non-United States
entity and the domestication shall constitute a continuation of the
existence of the domesticating non-United States entity in the form of
a corporation of this State. When any domestication shall have become
effective under this section, for all purposes of the laws of the State
of Delaware, all of the rights, privileges and powers of the non-United
States entity that has been domesticated, and all property, real,
personal and mixed, and all debts due to such non-United States entity,
as well as all other things and causes of action belonging to such
non-United States entity, shall remain vested in the corporation to
which such non-United States entity has been domesticated (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) and shall
be the property of such corporation (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), and the title to any real
property vested by deed or otherwise in such non-United States entity
shall not revert or be in any way impaired by reason of this title; but
all rights of creditors and all liens upon any property of such
non-United States entity shall be preserved unimpaired, and all debts,
liabilities and duties of the non-United States entity that has been
domesticated shall remain attached to the corporation to which such
non-United States entity has been domesticated (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), and may be
enforced against it to the same extent as if said debts, liabilities
and duties had originally been incurred or contracted by it in its
capacity as such corporation. The rights, privileges, powers and
interests in property of the non-United States entity, as well as the
debts, liabilities and duties of the non-United States entity, shall
not be deemed, as a consequence of the domestication, to have been
transferred to the corporation to which such non-United States entity
has domesticated for any purpose of the laws of the State of Delaware.

(j) Unless otherwise agreed or otherwise
required under applicable non-Delaware law, the domesticating
non-United States entity shall not be required to wind up its affairs
or pay its liabilities and distribute its assets, and the domestication
shall not be deemed to constitute a dissolution of such non-United
States entity. If, following domestication, a non-United States entity
that has become domesticated as a corporation of this State continues
its existence in the foreign jurisdiction in which it was existing
immediately prior to domestication, the corporation and such non-United
States entity shall, for all purposes of the laws of the State of
Delaware, constitute a single entity formed, incorporated, created or
otherwise having come into being, as applicable, and existing under the
laws of the State of Delaware and the laws of such foreign jurisdiction.

(k) In connection with a domestication
under this section, shares of stock, rights or securities of, or
interests in, the non-United States entity that is to be domesticated
as a corporation of this State may be exchanged for or converted into
cash, property, or shares of stock, rights or securities of such
corporation or, in addition to or in lieu thereof, may be exchanged for
or converted into cash, property, or shares of stock, rights or
securities of, or interests in, another corporation or other entity or
may be cancelled. (64 Del. Laws, c. 321, § 2; 65 Del. Laws, c. 127, §
11; 70 Del. Laws, c. 587, § 33; 75 Del. Laws, c. 30, §§ 29-45.)

§ 389. Temporary transfer of domicile into this State.

(a) As used in this section:

(1) The term “foreign jurisdiction” and
the term “non-United States entity” shall have the same meanings as set
forth in § 388(a) of this title.

(2) The terms “officers” and “directors”
include, in addition to such persons, trustees, managers, partners and
all other persons performing functions equivalent to those of officers
and directors, however named or described in any relevant instrument.

(3) The term “emergency condition” shall be deemed to include but not be limited to any of the following:

a. War or other armed conflict;

b. Revolution or insurrection;

c. Invasion or occupation by foreign military forces;

d. Rioting or civil commotion of an extended nature;

e. Domination by a foreign power;

f. Expropriation, nationalization or confiscation of a material part of the assets or property of the non-United States entity;

g. Impairment of the institution of private property (including private property held abroad);

h. The taking of any action under the
laws of the United States whereby persons resident in the jurisdiction,
the law of which governs the internal affairs of the non-United States
entity, might be treated as “enemies” or otherwise restricted under
laws of the United States relating to trading with enemies of the
United States;

i. The immediate threat of any of the foregoing; and

j. Such other event which, under the law
of the jurisdiction governing the internal affairs of the non-United
States entity, permits the non-United States entity to transfer its
domicile.

(b) Any non-United States entity may,
subject to and upon compliance with this section, transfer its domicile
(which term, as used in this section, shall be deemed to refer in
addition to the seat, siege social or principal place of business or
central administration of such entity, or any other equivalent thereto
under applicable law) into this State, and may perform the acts
described in this section, so long as the law by which the internal
affairs of such entity are governed does not expressly prohibit such
transfer.

(c) Any non-United States entity that
shall propose to transfer its domicile into this State shall submit to
the Secretary of State for the Secretary of State’s review, at least 30
days prior to the proposed transfer of domicile, the following:

(1) A copy of its certificate of
incorporation and bylaws (or the equivalent thereof under applicable
law), certified as true and correct by the appropriate director,
officer or government official;

(2) A certificate issued by an authorized
official of the jurisdiction the law of which governs the internal
affairs of the non-United States entity evidencing its existence;

(3) A list indicating the person or
persons who, in the event of a transfer pursuant to this section, shall
be the authorized officers and directors of the non-United States
entity, together with evidence of their authority to act and their
respective executed agreements in writing regarding service of process
as set out in subsection (j) of this section;

(4) A certificate executed by the appropriate officer or director of the non-United States entity, setting forth:

a. The name and address of its registered agent in this State;

b. A general description of the business in which it is engaged;

c. That the filing of such certificate
has been duly authorized by any necessary action and does not violate
the certificate of incorporation or bylaws (or equivalent thereof under
applicable law) or any material agreement or instrument binding on such
entity;

d. A list indicating the person or
persons authorized to sign the written communications required by
subsection (e) of this section;

e. An affirmance that such transfer is
not expressly prohibited under the law by which the internal affairs of
the non-United States entity are governed; and

f. An undertaking that any transfer of
domicile into this State will take place only in the event of an
emergency condition in the jurisdiction the law of which governs the
internal affairs of the non-United States entity and that such transfer
shall continue only so long as such emergency condition, in the
judgment of the non-United States entity’s management, so requires; and

(5) The examination fee prescribed under § 391 of this title.

If any of the documents referred to in
paragraphs (1)-(5) of this subsection are not in English, a translation
thereof, under oath of the translator, shall be attached thereto. If
such documents satisfy the requirements of this section, and if the
name of the non-United States entity meets the requirements of §
102(a)(1) of this title, the Secretary of State shall notify the
non-United States entity that such documents have been accepted for
filing, and the records of the Secretary of State shall reflect such
acceptance and such notification. In addition, the Secretary of State
shall enter the name of the non-United States entity on the Secretary
of State’s reserved list to remain there so long as the non-United
States entity is in compliance with this section. No document submitted
under this subsection shall be available for public inspection pursuant
to Chapter 100 of Title 29 until, and unless, such entity effects a
transfer of its domicile as provided in this section. The Secretary of
State may waive the 30-day period and translation requirement provided
for in this subsection upon request by such entity, supported by facts
(including, without limitation, the existence of an emergency
condition) justifying such waiver.

(d) On or before March 1 in each year,
prior to the transfer of its domicile as provided for in subsection (e)
of this section, during any such transfer and, in the event that it
desires to continue to be subject to a transfer of domicile under this
section, after its domicile has ceased to be in this State, the
non-United States entity shall file a certificate executed by an
appropriate officer or director of the non-United States entity,
certifying that the documents submitted pursuant to this section remain
in full force and effect or attaching any amendments or supplements
thereto and translated as required in subsection (c) of this section,
together with the filing fee prescribed under § 391 of this title. In
the event that any non-United States entity fails to file the required
certificate on or before March 1 in each year, all certificates and
filings made pursuant to this section shall become null and void on
March 2 in such year, and any proposed transfer thereafter shall be
subject to all of the required submissions and the examination fee set
forth in subsection (c) of this section.

(e) If the Secretary of State accepts the
documents submitted pursuant to subsection (c) of this section for
filing, such entity may transfer its domicile to this State at any time
by means of a written communication to such effect addressed to the
Secretary of State, signed by 1 of the persons named on the list filed
pursuant to subparagraph d. of paragraph (4) of subsection (c) of this
section, and confirming that the statements made pursuant to paragraph
(4) of subsection (c) of this section remain true and correct;
provided, that if emergency conditions have affected ordinary means of
communication, such notification may be made by telegram, telex,
telecopy or other form of writing so long as a duly signed duplicate is
received by the Secretary of State within 30 days thereafter. The
records of the Secretary of State shall reflect the fact of such
transfer. Upon the payment to the Secretary of State of the fee
prescribed under § 391 of this title, the Secretary of State shall
certify that the non-United States entity has filed all documents and
paid all fees required by this title. Such certificate of the Secretary
of State shall be prima facie evidence of transfer by such non-United
States entity of its domicile into this State.

(f) Except to the extent expressly
prohibited by the laws of this State, from and after the time that a
non-United States entity transfers its domicile to this State pursuant
to this section, the non-United States entity shall have all of the
powers which it had immediately prior to such transfer under the law of
the jurisdiction governing its internal affairs and the directors and
officers designated pursuant to paragraph (3) of subsection (c) of this
section, and their successors, may manage the business and affairs of
the non-United States entity in accordance with the laws of such
jurisdiction. Any such activity conducted pursuant to this section
shall not be deemed to be doing business within this State for purposes
of § 371 of this title. Any reference in this section to the law of the
jurisdiction governing the internal affairs of a non-United States
entity which has transferred its domicile into this State shall be
deemed to be a reference to such law as in effect immediately prior to
the transfer of domicile.

(g) For purposes of any action in the
courts of this State, no non-United States entity which has obtained
the certificate of the Secretary of State referred to in subsection (e)
of this section shall be deemed to be an “enemy” person or entity for
any purpose, including, without limitation, in relation to any claim of
title to its assets, wherever located, or to its ability to institute
suit in said courts.

(h) The transfer by any non-United States
entity of its domicile into this State shall not be deemed to affect
any obligations or liabilities of such non-United States entity
incurred prior to such transfer.

(i) The directors of any non-United
States entity which has transferred its domicile into this State may
withhold from any holder of equity interests in such entity any amounts
payable to such holder on account of dividends or other distributions,
if the directors shall determine that such holder will not have the
full benefit of such payment, so long as the directors shall make
provision for the retention of such withheld payment in escrow or under
some similar arrangement for the benefit of such holder.

(j) All process issued out of any court
of this State, all orders made by any court of this State and all rules
and notices of any kind required to be served on any non-United States
entity which has transferred its domicile into this State may be served
on the non-United States entity pursuant to § 321 of this title in the
same manner as if such entity were a corporation of this State. The
directors of a non-United States entity which has transferred its
domicile into this State shall agree in writing that they will be
amenable to service of process by the same means as, and subject to the
jurisdiction of the courts of this State to the same extent as are
directors of corporations of this State, and such agreements shall be
submitted to the Secretary of State for filing before the respective
directors take office.

(k) Any non-United States entity which
has transferred its domicile into this State may voluntarily return to
the jurisdiction the law of which governs its internal affairs by
filing with the Secretary of State an application to withdraw from this
State. Such application shall be accompanied by a resolution of the
directors of the non-United States entity authorizing such withdrawal
and by a certificate of the highest diplomatic or consular official of
such jurisdiction accredited to the United States indicating the
consent of such jurisdiction to such withdrawal. The application shall
also contain, or be accompanied by, the agreement of the non-United
States entity that it may be served with process in this State in any
proceeding for enforcement of any obligation of the non-United States
entity arising prior to its withdrawal from this State, which agreement
shall include the appointment of the Secretary of State as the agent of
the non-United States entity to accept service of process in any such
proceeding and shall specify the address to which a copy of process
served upon the Secretary of State shall be mailed. Upon the payment of
any fees and taxes owed to this State, the Secretary of State shall
file the application and the non-United States entity’s domicile shall,
as of the time of filing, cease to be in this State. (64 Del. Laws, c.
321, § 3; 71 Del. Laws, c. 339, § 88; 75 Del. Laws, c. 30, §§ 46-66.)

§ 390. Transfer, domestication or continuance of domestic corporations.

(a) Upon compliance with the provisions
of this section, any corporation existing under the laws of this State
may transfer to or domesticate or continue in any foreign jurisdiction
and, in connection therewith, may elect to continue its existence as a
corporation of this State. As used in this section, the term:

(1) “Foreign jurisdiction” means any
foreign country, or other foreign jurisdiction (other than the United
States, any state, the District of Columbia, or any possession or
territory of the United States); and

(2) “Resulting entity” means the entity
formed, incorporated, created or otherwise coming into being as a
consequence of the transfer of the corporation to, or its domestication
or continuance in, a foreign jurisdiction pursuant to this section.

(b) The board of directors of the
corporation which desires to transfer to or domesticate or continue in
a foreign jurisdiction shall adopt a resolution approving such
transfer, domestication or continuance specifying the foreign
jurisdiction to which the corporation shall be transferred or in which
the corporation shall be domesticated or continued and, if applicable,
that in connection with such transfer, domestication or continuance the
corporation’s existence as a corporation of this State is to continue
and recommending the approval of such transfer or domestication or
continuance by the stockholders of the corporation. Such resolution
shall be submitted to the stockholders of the corporation at an annual
or special meeting. Due notice of the time, place and purpose of the
meeting shall be mailed to each holder of stock, whether voting or
nonvoting, of the corporation at the address of the stockholder as it
appears on the records of the corporation, at least 20 days prior to
the date of the meeting. At the meeting, the resolution shall be
considered and a vote taken for its adoption or rejection. If all
outstanding shares of stock of the corporation, whether voting or
nonvoting, shall be voted for the adoption of the resolution, the
corporation shall file with the Secretary of State a certificate of
transfer if its existence as a corporation of this State is to cease or
a certificate of transfer and domestic continuance if its existence as
a corporation of this State is to continue, executed in accordance with
§ 103 of this title, which certifies:

(1) The name of the corporation, and if it has been changed, the name under which it was originally incorporated.

(2) The date of filing of its original certificate of incorporation with the Secretary of State.

(3) The foreign jurisdiction to which the
corporation shall be transferred or in which it shall be domesticated
or continued and the name of the resulting entity.

(4) That the transfer, domestication or
continuance of the corporation has been approved in accordance with the
provisions of this section.

(5) In the case of a certificate of
transfer, (i) that the existence of the corporation as a corporation of
this State shall cease when the certificate of transfer becomes
effective, and (ii) the agreement of the corporation that it may be
served with process in this State in any proceeding for enforcement of
any obligation of the corporation arising while it was a corporation of
this State which shall also irrevocably appoint the Secretary of State
as its agent to accept service of process in any such proceeding and
specify the address to which a copy of such process shall be mailed by
the Secretary of State.

(6) In the case of a certificate of
transfer and domestic continuance, that the corporation will continue
to exist as a corporation of this State after the certificate of
transfer and domestic continuance becomes effective.

(c) Upon the filing of a certificate of
transfer in accordance with subsection (b) of this section and payment
to the Secretary of State of all fees prescribed under this title, the
Secretary of State shall certify that the corporation has filed all
documents and paid all fees required by this title, and thereupon the
corporation shall cease to exist as a corporation of this State at the
time the certificate of transfer becomes effective in accordance with §
103 of this title. Such certificate of the Secretary of State shall be
prima facie evidence of the transfer, domestication or continuance by
such corporation out of this State.

(d) The transfer, domestication or
continuance of a corporation out of this State in accordance with this
section and the resulting cessation of its existence as a corporation
of this State pursuant to a certificate of transfer shall not be deemed
to affect any obligations or liabilities of the corporation incurred
prior to such transfer, domestication or continuance, the personal
liability of any person incurred prior to such transfer, domestication
or continuance, or the choice of law applicable to the corporation with
respect to matters arising prior to such transfer, domestication or
continuance. Unless otherwise agreed or otherwise provided in the
certificate of incorporation, the transfer, domestication or
continuance of a corporation out of the State of Delaware in accordance
with this section shall not require such corporation to wind up its
affairs or pay its liabilities and distribute its assets under this
title and shall not be deemed to constitute a dissolution of such
corporation.

(e) If a corporation files a certificate
of transfer and domestic continuance, after the time the certificate of
transfer and domestic continuance becomes effective, the corporation
shall continue to exist as a corporation of this State, and the law of
the State of Delaware, including this title, shall apply to the
corporation to the same extent as prior to such time. So long as a
corporation continues to exist as a corporation of the State of
Delaware following the filing of a certificate of transfer and domestic
continuance, the continuing corporation and the resulting entity shall,
for all purposes of the laws of the State of Delaware, constitute a
single entity formed, incorporated, created or otherwise having come
into being, as applicable, and existing under the laws of the State of
Delaware and the laws of the foreign jurisdiction.

(f) When a corporation has transferred,
domesticated or continued pursuant to this section, for all purposes of
the laws of the State of Delaware, the resulting entity shall be deemed
to be the same entity as the transferring, domesticating or continuing
corporation and shall constitute a continuation of the existence of
such corporation in the form of the resulting entity. When any
transfer, domestication or continuance shall have become effective
under this section, for all purposes of the laws of the State of
Delaware, all of the rights, privileges and powers of the corporation
that has transferred, domesticated or continued, and all property,
real, personal and mixed, and all debts due to such corporation, as
well as all other things and causes of action belonging to such
corporation, shall remain vested in the resulting entity (and also in
the corporation that has transferred, domesticated or continued, if and
for so long as such corporation continues its existence as a
corporation of this State) and shall be the property of such resulting
entity (and also of the corporation that has transferred, domesticated
or continued, if and for so long as such corporation continues its
existence as a corporation of this State), and the title to any real
property vested by deed or otherwise in such corporation shall not
revert or be in any way impaired by reason of this title; but all
rights of creditors and all liens upon any property of such corporation
shall be preserved unimpaired, and all debts, liabilities and duties of
such corporation shall remain attached to the resulting entity (and
also to the corporation that has transferred, domesticated or
continued, if and for so long as such corporation continues its
existence as a corporation of this State), and may be enforced against
it to the same extent as if said debts, liabilities and duties had
originally been incurred or contracted by it in its capacity as such
resulting entity. The rights, privileges, powers and interests in
property of the corporation, as well as the debts, liabilities and
duties of the corporation, shall not be deemed, as a consequence of the
transfer, domestication or continuance, to have been transferred to the
resulting entity for any purpose of the laws of the State of Delaware.

(g) In connection with a transfer,
domestication or continuance under this section, shares of stock of the
transferring, domesticating or continuing corporation may be exchanged
for or converted into cash, property, or shares of stock, rights or
securities of, or interests in, the resulting entity or, in addition to
or in lieu thereof, may be exchanged for or converted into cash,
property, or shares of stock, rights or securities of, or interests in,
another corporation or other entity or may be cancelled.

(h) No vote of the stockholders of a
corporation shall be necessary to authorize a transfer, domestication
or continuance if no shares of the stock of such corporation shall have
been issued prior to the adoption by the board of directors of the
resolution approving the transfer, domestication or continuance. (70
Del. Laws, c. 79, § 20; 71 Del. Laws, c. 120, §§ 20-29; 75 Del. Laws,
c. 30, §§ 67-79.)

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