The Citizens For A Pro Business Delaware, Inc.

1571 WordsJan 29, 20177 Pages
The Citizens for a Pro-Business Delaware, Inc. (“Citizens”) has offered a proposed amendment to 8 Del. C. § 226. Specifically they argue that §266 has two clear deficiencies, (1) the statute does not give sufficient guidance for the court as to the many potential remedies developed by court and academics; and (2) the statute provides no guidance or restrictions on when courts should use the extreme remedies. Currently §266(a) states, (a) The Court of Chancery, upon application of any stockholder, may appoint 1 or more persons to be custodians, and, if the corporation is insolvent, to be receivers, of and for any corporation when: (1) At any meeting held for the election of directors the stockholders are so divided that they have failed to…show more content…
Citizens Memo Ex. A. Consequently, this memo will discuss the validity of these proposed changes in reference to cited national and Delaware statutes and cases that attempt to highlight the necessity and legal precedence of Citizens’ proposed changes. However, despite their attempts, these proposed changes overstep the bounds set, not only in Delaware but nationwide, as a result there changes should not be applied to §226. I. ALTERNATE REMEDIES AND WHEN TO GRANT THEM Citizens has offered several statutes to give a nationwide assessment of the current state of corporate aw as it concerns remedies for deadlock and when to grant them, however, these statutes are not similar to their proposed statute changes. These statutes include 805 Ill. Comp. Stat. Ann. 5/12.56(b), Ga.Code Ann. § 14-2-941(a), Mo. Ann. Stat. § 351.855, Mont. Code Ann. § 35-9-502(1); Or. Rev. Stat. Ann. § 60.952(2); S.C. Code Ann. § 33-18-410(a); Wis. Stat.Ann. § 180.1833(2) (a), Wyo. Stat. Ann. § 17-17-141(a), and cf. Model Bus. Corp. Act Ann., Model Statutory Close Corp. Supplement, § 41 (1984). All of the various statutes give an itemize list of alternative remedies for deadlock however, none of them are similar to the current construction of §266 nor the proposed statute. These itemized lists are intended to give guidance to when dissolution of a corporation is needed. See § 60.952(2); §

More about The Citizens For A Pro Business Delaware, Inc.

Open Document