Chapter 7

§ 701 Establishment of banks and trust companies; savings banks and national banks [For application of this section, see 85 Del. Laws, c. 337, § 24]. (a) Except as specifically provided by Chapter 15 or Chapter 16 of this title, banks and trust companies shall be established or created in this State under and in accordance with this chapter. This chapter shall not, however, apply to national banks, except as otherwise provided in subchapters VI and VII of this chapter. The terms “bank” or “banks,” when used in this chapter, do not include such national banks, except as otherwise provided in subchapters VI and VII of this chapter. Furthermore, the provisions of this chapter specifically relating to capital stock or stockholders of a bank organized under this chapter shall not apply to a corporation without capital stock doing a savings bank business. (b) The State Bank Commissioner shall have the authority to allow the establishment under this chapter of banks and trust companies that are authorized to exercise all or less than all of the powers, including incidental powers, that are conferred on them by this chapter, including banks and trust companies whose powers are limited in their articles of association and by order of the State Bank Commissioner. The State Bank Commissioner may promulgate regulations to carry out the State Bank Commissioner’s authority under this chapter, including adopting different forms of applications for a certificate of public convenience and advantage with differing requirements based on the underlying risks of the proposed activities of the bank or trust company. 38 Del. Laws, c. 94, §§  1, 2 ; Code 1935, §§  2370, 2371; 5 Del. C. 1953, §  701; 64 Del. Laws, c. 42, §  2 ; 70 Del. Laws, c. 327, §  3 ; 70 Del. Laws, c. 336, §  1 ; 71 Del. Laws, c. 19, §  19 ; 71 Del. Laws, c. 25, §  7 ; 85 Del. Laws, c. 337, § 5 ; § 702 Applicability of other laws. Every corporation (but not including a limited liability company) created under this chapter shall be deemed to be subject to and entitled to the benefit of this Code and any other general statutes of this State making provision for the regulation of banks and trust companies, or for the regulation and governance of corporations established under Title 8 of this Code, where the same are not inconsistent with the express provisions of this chapter. Every limited liability company created under this chapter shall be deemed to be subject to and entitled to the benefit of this Code and any other general statutes of this State making provision for the regulation of trust companies, or for the regulation and governance of limited liability companies formed under Title 6, where the same are not inconsistent with the express provisions of this chapter. 38 Del. Laws, c. 94, §  32 ; Code 1935, §  2401; 5 Del. C. 1953, §  702; 64 Del. Laws, c. 156, §  2 ; 76 Del. Laws, c. 383, §  2 ; § 703 Taxation. Every corporation and limited liability company created by or under this chapter, and every corporation and limited liability company whose charter, certificate of incorporation or certificate of formation is amended under this chapter, shall be subject to the same taxation as shall be fixed by the laws of this State for banks and trust companies. 38 Del. Laws, c. 94, §  34 ; Code 1935, §  2403; 5 Del. C. 1953, §  703; 61 Del. Laws, c. 490, §  1 ; 76 Del. Laws, c. 383, §  3 ; § 704 Reserved power of State to amend or repeal this chapter. This chapter may be amended or repealed, at the pleasure of the General Assembly, but such amendment or repeal shall not take away or repeal any remedy against any corporation established under this chapter, or its officers, for any liability which shall have been previously incurred. 38 Del. Laws, c. 94, §  35 ; Code 1935, §  2404; 5 Del. C. 1953, §  704; § 705 Revocation for nonuse of charters granted prior to July 1, 1933. Every charter authorizing the establishment of a bank or trust company in this State and which was granted or passed by the General Assembly of this State prior to the 1st day of July, 1933, shall be deemed and held to be revoked for nonuse of corporate franchise unless the corporation created or authorized by such charter was actively engaged in business in this State on December 31, 1933. 32 Del. Laws, c. 103, §  22 ; 38 Del. Laws, c. 93, §  1(8) ; Code 1935, §  2310; 5 Del. C. 1953, §  705; § 706 Limited liability companies as trust companies, conversions [For application of this section, see 85 Del. Laws, c. 346, § 9]. (a) Notwithstanding any other provision of law to the contrary, a trust company, including a limited purpose trust company or a family trust company, may be a limited liability company and any trust company that is a limited liability company shall have all the powers and privileges of, and, except to the extent expressly otherwise provided in this Code, shall be subject to all the duties, restrictions and liabilities of, a corresponding trust company that is a corporation. Except to the extent expressly otherwise provided in this Code, a trust company that is a limited liability company shall be subject to all of the same laws and regulations of this State that relate to a trust company that is a corporation. (b) Unless another intention clearly appears or unless the context requires a different meaning, any terms used in this Code that apply to a trust company that is a corporation shall be construed to apply in the same manner, or in a manner as similar as possible given the context, to a trust company that is a limited liability company, and without limiting the generality of the foregoing, each reference in this Code to: (1) “Capital stock” or “stock” that refers to the stock of a trust company that is a corporation shall also refer to the limited liability company interests in a trust company that is a limited liability company and, correspondingly, each reference in this Code to “common stock”, “preferred stock” and “voting stock” that refers to common stock, preferred stock and voting stock, respectively, of a trust company that is a corporation shall also refer to common limited liability company interests, preferred limited liability company interests and voting limited liability company interests, respectively, in a trust company that is a limited liability company; (2) “Certificate of incorporation” or “charter” that refers to the certificate of incorporation, charter or articles of association, as applicable, of a trust company that is a corporation shall also refer to the certificate of formation and/or articles of association, as applicable, of a trust company that is a limited liability company; (3) “Corporate” that relates to a trust company that is a corporation shall mean “limited liability company” in relation to a trust company that is a limited liability company; (4) “Corporation” that refers to a trust company that is a corporation shall also refer to a trust company that is a limited liability company; provided, that nothing in this chapter shall be construed to affect the status of a trust company that is a limited liability company as a limited liability company rather than a corporation; (5) “Director” or “board of directors” that refers to a director or the board of directors of a trust company that is a corporation shall also refer to a manager or the board of managers of a trust company that is a limited liability company; (6) “Dividends” that refers to dividends of a trust company that is a corporation shall also refer to distributions of a trust company that is a limited liability company; (7) “Incorporated” or “incorporation” that refers to a trust company that is a corporation shall refer to the formation status or formation of a trust company that is a limited liability company; provided that, notwithstanding the foregoing, a trust company that is a limited liability company is formed rather than incorporated; (8) “Incorporator” that refers to an incorporator of a trust company that is a corporation shall also refer to an initial member of a trust company that is a limited liability company; (9) “Shares” that refers to the shares of stock of a trust company that is a corporation shall also refer to the units into which the limited liability company interests in a trust company that is a limited liability company are divided; and (10) “Stockholder” or “shareholder” that refers to a stockholder of a trust company that is a corporation shall also refer to a member of a trust company that is a limited liability company. (c) The limited liability company agreement of a trust company that is a limited liability company shall be comprised solely of the articles of association of the trust company and the bylaws of the trust company and shall be subject to the approval of the State Bank Commissioner as to form and substance. The bylaws of a trust company that is a limited liability company shall not contain any provision that is inconsistent with the articles of association of the trust company. The business and affairs of a trust company that is a limited liability company shall be managed by or under the direction of a board of managers, which shall be designated as a “board of directors” and each manager shall be a natural person and shall be designated as a “director”. Each member of a trust company that is a limited liability company shall be designated as a “stockholder.” The limited liability company interests in a trust company that is a limited liability company shall be designated as “stock.” The units into which limited liability company interests in a trust company that is a limited liability company are divided shall be designated as “shares.” (d) With the prior approval of the State Bank Commissioner, a trust company that is a corporation may convert to a trust company that is a limited liability company by following the applicable procedures set forth in Titles 6 and 8 for the conversion of a corporation incorporated under Chapter 1 of Title 8 to a limited liability company formed under Chapter 18 of Title 6, provided, that, in lieu of filing in the office of the Secretary of State a certificate of formation that complies with § 18-201 of Title 6 pursuant to § 18-214 of Title 6, articles of organization of the limited liability company that comply with § 730 of this title shall be filed in the office of the Secretary of State and, upon the filing of a certificate of conversion to limited liability company as required by § 18-214 of Title 6 and the articles of organization as required by § 730 of this title, the Secretary of State shall issue a certificate of formation for such limited liability company pursuant to § 731 of this title. Such a conversion shall be subject to, and shall have all of the effects provided for under, § 18-214 of Title 6 and § 266 of Title 8 to the extent the same are not inconsistent with the express provisions of this chapter. (e) With the prior approval of the State Bank Commissioner, a trust company that is a limited liability company may convert to a trust company that is a corporation by following the applicable procedures set forth in Titles 6 and 8 for the conversion of a limited liability company formed under Chapter 18 of Title 6 to a corporation incorporated under Chapter 1 of Title 8, provided, that, in lieu of filing in the office of the Secretary of State a certificate of incorporation pursuant to § 265 of Title 8, articles of organization of the corporation that comply with § 730 of this title shall be filed in the office of the Secretary of State and, upon the filing of a certificate of conversion to corporation as required by § 265 of Title 8 and the articles of organization as required by § 730 of this title, the Secretary of State shall issue a certificate of incorporation for such corporation pursuant to § 731 of this title. Such a conversion shall be subject to, and shall have all of the effects provided for under, § 265 of Title 8 and § 18-216 of Title 6 to the extent the same are not inconsistent with the express provisions of this chapter. 76 Del. Laws, c. 383, §  4 ; 85 Del. Laws, c. 346, § 3 ; Delaware General Assembly Judicial Executive Contact Twitter Help function submitSearch() { if (!window.location.origin) { window.location.origin = window.location.protocol + "//" + window.location.hostname + (window.location.port ? ':' + window.location.port : ''); } keyword = document.getElementById('srch-term').value; window.location.href = "/Search?query=" + keyword; } document.getElementById('srch-term').onkeyup = function (e) { if (e.keyCode == 13) { submitSearch(); } } § 721 Restrictions on use of words “savings” or “trust” in corporate name [Repealed]. Repealed by 70 Del. Laws, c. 6, § 2, eff. Feb. 10, 1995. § 722 Incorporators; number and qualifications. Three or more persons, at least 2 of whom must be citizens and residents of this State, of lawful age who associate themselves by a written agreement, hereinafter called “articles of association,” for the purpose of forming a bank or trust company may, upon compliance with this chapter, become a corporation, with the powers conferred by this chapter and subject to the regulations prescribed by this chapter and subject also to the regulations prescribed for banks and trust companies by any general statute of this State. Notwithstanding the foregoing, in the case of a trust company that is a limited liability company, 1 or more persons, whether individuals or nonnatural persons, each of whom will be an initial stockholder of the limited liability company and regardless of the citizenship, residency or domicile of such persons, who associate themselves by a written agreement, or in the case of 1 person, who executes a written agreement, in each case hereinafter called “articles of association,” for the purpose of forming a trust company may, upon compliance with this chapter, form a limited liability company with the powers conferred by this chapter and subject to the regulations prescribed for trust companies by any general statute of this State. 38 Del. Laws, c. 94, §  4 ; Code 1935, §  2373; 5 Del. C. 1953, §  722; 63 Del. Laws, c. 3, §  1 ; 71 Del. Laws, c. 25, §  8 ; 76 Del. Laws, c. 383, §  5 ; § 723 Articles of association; contents and execution. (a) The articles of association shall set forth that the subscribers thereto associate themselves with the intention of forming a corporation, and shall specifically state: (1) The name by which the corporation shall be known; (2) The purpose for which it is formed; (3) The city or town where its place of business will be located; (4) The amount of its capital stock, and the number of shares into which it is to be divided; (5) The number, or manner of fixing such number, of its directors, which shall not be less than 5; (6) Whether or not the corporation is to have perpetual existence, and if not the time when its existence is to cease; (7) Whether the private property of the stockholders shall be subject to the payment of corporate debts, and if so, to what extent. (b) The articles of association may also contain other provisions defining, limiting and regulating the powers of the corporation, the powers and duties of the directors, and the powers of the stockholders, if such provisions are consonant with the object, purpose and provisions of this chapter and are not in conflict with this Code or any other general statute of this State relating to banks and trust companies. (c) Each incorporator shall subscribe to the articles his or her name, residence, post-office address and the number of shares of stock which he or she agrees to take, and shall acknowledge the same to be his or her act and deed before some officer authorized by the laws of this State to take acknowledgments of deeds. (d) The articles of association may contain an article which provides that any article or provision thereof shall not be amended, modified, repealed or otherwise changed in any manner whatsoever. Such an article, when approved by the Commissioner under § 729 of this title, shall be valid, binding and enforceable against the corporation and its shareholders notwithstanding any other provision of this title. 38 Del. Laws, c. 94, §  5 ; Code 1935, §  2374; 5 Del. C. 1953, §  723; 64 Del. Laws, c. 386, §  1 ; 70 Del. Laws, c. 186, §  1 ; 85 Del. Laws, c. 337, § 6 ; § 724 Notice of intention to incorporate; publication. Notice of the intention of the incorporators to form a bank or trust company shall be given to the State Bank Commissioner, and a notice in such form as the Commissioner shall approve shall be published at least once a week, for 2 successive weeks, in 1 or more newspapers designated by the Commissioner, at least 1 of which newspapers shall be published in the county where it is proposed to establish the bank or trust company. The published notice shall specify the names of all the associates, the name of the proposed corporation, the city or town where it is to be located, and the amount of its capital stock. 38 Del. Laws, c. 94, §  6 ; Code 1935, §  2375; 5 Del. C. 1953, §  724; 57 Del. Laws, c. 740, §  19A ; 71 Del. Laws, c. 254, §  6 ; § 725 Application for a certificate of public convenience and advantage. Within 60 days after the second publication of the notice of intention to incorporate but not before the expiration of 20 days from the date of the second publication, the incorporators shall apply to the State Bank Commissioner for a certificate that public convenience and advantage will be promoted by the establishment of the bank or trust company. 38 Del. Laws, c. 94, §  6 ; Code 1935, §  2375; 5 Del. C. 1953, §  725; 57 Del. Laws, c. 740, §  19A ; 71 Del. Laws, c. 254, §  7 ; § 726 Determination of public convenience. Upon the application for a certificate that public convenience and advantage will be promoted by the establishment of the bank or trust company, the State Bank Commissioner shall consider and determine whether public convenience and advantage would be promoted by the establishment of the bank or trust company, and whether the terms and provisions of the articles of association are in compliance with this chapter and shall issue or refuse to issue a certificate in accordance with such determination. If the Commissioner refuses to issue a certificate, no further proceedings shall be had, but the application may be renewed after 1 year from the date of the refusal. If the Commissioner issues the certificate, the incorporators shall hold the first meeting and follow the procedure prescribed by § 727 of this title. 38 Del. Laws, c. 94, §  7 ; Code 1935, §  2376; 5 Del. C. 1953, §  726; 57 Del. Laws, c. 740, §  19A ; § 727 Organization meeting of incorporators; notice; proceedings. (a) The first meeting of the incorporators shall be called by a notice signed either by the incorporator who is designated in the articles of association for the purpose, or by a majority of the incorporators. The notice shall state the time, place and purposes of the meeting. A copy of the notice shall, at least 7 days before the day appointed for the meeting, be given to each incorporator, or left at the incorporator’s residence or usual place of business, or deposited in the post office, postage prepaid, and addressed to the incorporator at his or her residence or usual place of business, and another copy thereof and an affidavit of 1 of the incorporators that the notice has been duly served shall be filed and recorded with the records of the corporation. If all the incorporators shall in writing, endorsed upon the articles of association, waive such notice and fix the time and place of the meeting, no notice shall be required. (b) At the first meeting, or at any adjournment thereof, the incorporators shall organize by the choice by ballot of a temporary secretary, by the adoption of bylaws and by the election in such manner as the bylaws may determine, of directors, a president, a secretary, and such other officers as the bylaws may prescribe. All the officers so elected shall be sworn to the faithful performance of their duties. The temporary secretary shall make and attest a record of the proceedings until the secretary has been chosen and sworn, including a record of such choice and qualification. 38 Del. Laws, c. 94, §  8 ; Code 1935, §  2377; 5 Del. C. 1953, §  727; 70 Del. Laws, c. 186, §  1 ; § 728 Articles of organization. The president and a majority of the directors elected at the organization meeting of the incorporators shall make, sign and make oath to, a certificate (hereinafter called “articles of organization”) setting forth: (1) A true copy of the articles of association; (2) The names of the subscribers thereto; (3) The name, residence, business, post office or mailing address of each of the officers of the corporation; and (4) The date of the first meeting and the successive adjournments thereof, if any. 38 Del. Laws, c. 94, §  9 ; Code 1935, §  2378; 5 Del. C. 1953, §  728; 85 Del. Laws, c. 337, § 7 ; § 729 Approval of articles of organization. The articles of organization, together with the records of the proposed corporation, shall be submitted to the State Bank Commissioner. The Commissioner shall examine the same, and may require such amendment thereof or such additional information as it may consider proper or necessary. If the Commissioner finds that the provisions of law have been complied with, the Commissioner shall endorse its approval upon the articles of organization. 38 Del. Laws, c. 94, §  9 ; Code 1935, §  2378; 5 Del. C. 1953, §  729; 57 Del. Laws, c. 740, §  19A ; § 730 Filing of articles of organization. The articles of organization with the endorsement of the State Bank Commissioner shall, within 30 days after the date of the endorsement, be filed in the office of the Secretary of State. 38 Del. Laws, c. 94, §  9 ; Code 1935, §  2378; 5 Del. C. 1953, §  730; 57 Del. Laws, c. 740, §  19A ; § 731 Certificate of incorporation; issuance, form, recording and evidence. (a) Upon the filing of the articles of organization as required by § 730 of this title, the Secretary of State shall issue a certificate of incorporation in the following form: STATE OF DELAWARE Be it known that whereas (the names of the incorporators) have associated themselves with the intention of forming a corporation under the name of (the name of the corporation), for the purpose (the purpose declared in the articles of association), with a capital stock of (the amount fixed in the articles of association), and having its place of business in (the city or town where its place of business will be located) and have complied with the statutes of this State in such case made and provided, as appears from the articles of organization of the corporation, duly approved by the State Bank Commissioner and on file in this office; now, therefore, I (the name of the Secretary of State), Secretary of the State of Delaware, do hereby certify that (the names of the incorporators), their associates and successors, are legally organized and established as, and are hereby made, an existing corporation under the name of (name of the corporation), with the powers, rights and privileges, and subject to the limitations, duties and restrictions which by law appertain thereto. Witness my official signature hereunto subscribed, and the great Seal of the State of Delaware hereunto affixed, this ________ day of ________________ in the year ________ (the date of the filing of the articles of organization). (b) Notwithstanding the foregoing, in the case of a trust company that is a limited liability company, upon the filing of the articles of organization as required by § 730 of this title, the Secretary of State shall issue a certificate of formation in the following form: STATE OF DELAWARE Be it known that whereas (the name(s) of the incorporator(s)) [has executed articles of association for the purpose][have associated themselves with the intention] of forming a limited liability company under the name of (the name of the limited liability company), for the purpose (the purpose declared in the articles of association), with a capital stock of (the amount fixed in the articles of association), and having its place of business in (the city or town where its place of business will be located) and [has][have] complied with the statutes of this State in such case made and provided, as appears from the articles of organization of the limited liability company, duly approved by the State Bank Commissioner and on file in this office; now, therefore, I (the name of the Secretary of State), Secretary of the State of Delaware, do hereby certify that (the name(s) of the incorporator(s)), [his][her][its][their] associates and successors, are legally formed and established as, and [is][are] hereby made, an existing limited liability company under the name of (name of the limited liability company), with the powers, rights and privileges, and subject to the limitations, duties and restrictions which by law appertain thereto. Witness my official signature hereunto subscribed, and the great Seal of the State of Delaware hereunto affixed, this ________ day of ________________ in the year ________ (the date of the filing of the articles of organization). (c) The Secretary of State shall sign the certificate of incorporation or certificate of formation, as applicable, and cause the Great Seal of the State to be thereto affixed and shall deliver the same to the corporation or the limited liability company, as applicable, together with a certified copy of the articles of organization and the endorsement of the State Bank Commissioner thereon, upon payment of the costs and charges therefor. A certified copy of the certificate shall be kept on file in the office of the Secretary of State with the articles of organization, and the certificate together with the articles of organization and the endorsement thereon of the State Bank Commissioner shall be recorded in the office of the recorder of deeds for the county in which the place of business of the corporation is to be located. (d) The certificate or a copy thereof duly certified by the Secretary of State, together with a certified copy of the articles of organization and the endorsement thereon of the State Bank Commissioner, accompanied with the certificate of the recorder of deeds for the county wherein the same is recorded under the recorder of deed’s hand and the seal of the recorder of deed’s office, stating that the certificate and articles of organization have been recorded in the office of the recorder, or a copy of the record duly certified by the recorder, shall be evidence in all courts of this State. 38 Del. Laws, c. 94, §  9 ; Code 1935, §  2378; 5 Del. C. 1953, §  731; 57 Del. Laws, c. 740, §  19A ; 70 Del. Laws, c. 186, §  1 ; 76 Del. Laws, c. 383, §§  6, 7 ; 84 Del. Laws, c. 42, § 1 ; § 732 Commencement of corporate existence. Upon the issuance of the certificate of incorporation or certificate of formation by the Secretary of State and the recording of the certificate and articles of organization as provided in § 731 of this title, the corporation or limited liability company named in such certificate and articles of organization shall from the date of the certificate be and constitute a corporation or limited liability company, for the purposes and by the name set forth in the certificate, subject to dissolution, termination or the revocation or forfeiture of the franchise under this chapter or under this Code or any other statute of this State relating to the dissolution or termination of or to the revocation or forfeiture of the charter or franchise of banks or trust companies; but the corporation or limited liability company shall not have the right to do any business until it has secured from the State Bank Commissioner of this State the certificate provided for in § 733 of this title. 38 Del. Laws, c. 94, §  9 ; Code 1935, §  2378; 5 Del. C. 1953, §  732; 76 Del. Laws, c. 383, §  8 ; § 733 Commencement of business; certificate authorizing. A certified copy of the certificate of incorporation and of the articles of organization and the endorsement of the approval of the State Bank Commissioner shall be filed with the State Bank Commissioner; and when the whole capital stock has been issued, a list of the stockholders, with the name, residence and post-office address of each, and the number of shares held by each, shall be filed with the State Bank Commissioner, which list shall be certified by the president and the cashier or treasurer of the corporation. Upon receipt of the list the Commissioner shall cause an examination to be made of the method of payment of the capital stock and if, after such examination, it appears that the whole capital stock has been paid in cash, and that all requirements of this Code and any other law have been complied with, the Commissioner shall issue a certificate authorizing the corporation to begin the transaction of business. No corporation shall begin the transaction of business until a certificate has been granted. 38 Del. Laws, c. 94, §  10 ; Code 1935, §  2379; 5 Del. C. 1953, §  733; 57 Del. Laws, c. 740, §  19A ; § 734 Revocation of charter for failure to commence business within reasonable time. Every corporation created under this chapter shall, after the expiration of a reasonable time from the date of its incorporation, as determined by the State Bank Commissioner, be actively engaged in the business for which it was created or its certificate of incorporation and corporate franchise shall be deemed and held to be revoked. The Commissioner shall by regulations prescribe the criteria to be applied in determining what constitutes a reasonable period of time. 38 Del. Laws, c. 94, §  33 ; Code 1935, §  2402; 5 Del. C. 1953, §  734; 63 Del. Laws, c. 3, §  2 ; § 735 Fees of Secretary of State and Commissioner. (a) The following fees shall be collected by and paid to the Secretary of State, for the use of the State: (1) For making and issuing the certificate of incorporation, $200. (2) For making the certified copy of the articles of association, $50. (3) For making the certified copy of the certificate of incorporation to be kept on file in the office of the Secretary of State and for filing and indexing the same and the articles of association in said office, $50. (4) For supplying any additional certified copy of the certificate of incorporation or articles of association requested by the corporation, $50. (5) For all services described in paragraphs (a)(1) through (a)(4) of this section that are requested to be completed within 24-hours of the time of request, an additional fee of up to $300. (b) Before issuing the certificate authorizing the corporation to begin the transaction of business, the State Bank Commissioner shall collect from the corporation, for the use of the State, the sum of $5,750. In addition, the applicant shall pay an investigation fee of $1,150 which shall not be refundable and shall be submitted with the application. 38 Del. Laws, c. 94, §  34 ; Code 1935, §  2403; 5 Del. C. 1953, §  735; 60 Del. Laws, c. 268, §§  2, 3 ; 67 Del. Laws, c. 260, §  1 ; 68 Del. Laws, c. 9, §  7 ; 85 Del. Laws, c. 273, § 1 ; Delaware General Assembly Judicial Executive Contact Twitter Help function submitSearch() { if (!window.location.origin) { window.location.origin = window.location.protocol + "//" + window.location.hostname + (window.location.port ? ':' + window.location.port : ''); } keyword = document.getElementById('srch-term').value; window.location.href = "/Search?query=" + keyword; } document.getElementById('srch-term').onkeyup = function (e) { if (e.keyCode == 13) { submitSearch(); } } § 741 Bylaws, adoption, amendment and repeal. A corporation may adopt bylaws for the proper management of its affairs, and may establish regulations controlling the assignment and transfer of its shares. The first set of bylaws shall be adopted at the meeting of the incorporators, as provided in § 727 of this title, but thereafter the power to make, alter or repeal bylaws shall be in the stockholders, provided that any corporation may, in the certificate of incorporation, confer that power upon the directors. 38 Del. Laws, c. 94, §  12 ; Code 1935, §  2381; 5 Del. C. 1953, §  741; 50 Del. Laws, c. 381, §  1 ; § 742 Directors; number, quorum, term, vacancies and oath. (a) The business of every corporation organized under this chapter shall be managed by a board of directors. The number of directors which shall constitute the whole board shall be such as shall be fixed by, or in the manner provided in, the articles of association, but in no case shall the number of directors be less than 5. The bylaws shall prescribe how many directors shall constitute a quorum for the transaction of business. (b) The directors elected at the organization meeting of the incorporators, as provided in § 727 of this title, shall hold office until the succeeding annual meeting of the stockholders and until their successors have been duly chosen and qualified, and thereafter directors shall be elected at the annual meeting of the stockholders or at an adjournment of the annual meeting. Vacancies in the board of directors shall be filled by a majority of the remaining directors, though less than a quorum, and the directors so chosen shall hold office until the next annual election and until their successors shall be duly elected and qualified. (c) Every director shall be sworn to the faithful performance of the director’s duties. 32 Del. Laws, c. 103, §  17 ; 38 Del. Laws, c. 94, §  11 ; Code 1935, §§  2305, 2380; 5 Del. C. 1953, §  742; 49 Del. Laws, c. 124 ; 63 Del. Laws, c. 142, §  3 ; 64 Del. Laws, c. 156, §  1 ; 70 Del. Laws, c. 186, §  1 ; 85 Del. Laws, c. 337, § 8 ; § 743 Stockholders’ meetings; time, place, adjournment and quorum. (a) Meetings of stockholders (except the meeting of incorporators referred to in § 727 of this title) shall be held in this State. The bylaws shall fix the time of the annual meeting and may provide for special or called meetings of stockholders. (b) Any meeting of the stockholders may be adjourned and at such adjourned meeting, any business may be transacted that could have been acted on at the meeting which was adjourned. (c) The bylaws may prescribe what number of shares shall be represented at any stockholders’ meeting to constitute a quorum, but in the absence of such a provision, any number of shares represented at a stockholders’ meeting shall be sufficient for the transaction of business thereat. 38 Del. Laws, c. 94, §  12 ; Code 1935, §  2381; 5 Del. C. 1953, §  743; 63 Del. Laws, c. 219, §  1 ; § 744 Voting rights of stockholders. Each stockholder shall, at every meeting of the stockholders, be entitled to 1 vote in person or by proxy for each share of the capital stock held by such stockholder on all issues on which such stockholder is entitled to vote. No stock shall be voted which shall have been transferred on the books of the corporation within 20 days next preceding the stockholders’ meeting. 38 Del. Laws, c. 94, §  12 ; Code 1935, §  2381; 5 Del. C. 1953, §  744; 60 Del. Laws, c. 350, §  1 ; § 745 Capital stock; minimum required. The capital stock of a bank organized under this chapter shall be as follows: not less than $500,000 if the bank is located in a city or town having a population of more than 50,000 persons; not less than $350,000 if the bank is located in a city or town of not more than 50,000 nor less than 5,000 persons; and not less than $250,000 if the bank is located in a town of not more than 5,000 persons, or such greater amount as the Commissioner may require after review of the charter, business plan and proposed activities of the bank. The capital stock of a trust company or limited purpose trust company organized under the law of this State shall not in any case be less than $500,000; provided, however, that this requirement shall not apply to trust companies organized under the laws of this State prior to February 28, 1933, and authorized by a certificate issued by the State Bank Commissioner to transact the business of a trust company on January 1, 1997. In addition to the capital stock required by the foregoing, every such bank, trust company or limited purpose trust company shall have a paid-in surplus account equal to no less than one-half of the minimum capital stock required by this section. The minimum capital stock and paid-in surplus required to be maintained by such corporation in its banking or trust company business pursuant to this section may not be utilized to satisfy the capital or reserve requirements to which the corporation may be subject with respect to any activity authorized by § 761(a)(14) of this title. 38 Del. Laws, c. 94, §  13 ; Code 1935, §  2382; 5 Del. C. 1953, §  745; 63 Del. Laws, c. 261, §  5 ; 67 Del. Laws, c. 55, §  1 ; 67 Del. Laws, c. 223, §  3 ; 71 Del. Laws, c. 19, §  20 ; § 746 Par value of stock; payment for and issuance; increase and reduction. The capital stock shall be divided into shares of a stated par value. No business shall be transacted by the corporation until the whole amount of its capital stock is subscribed for and actually paid in in cash. No stock shall be issued by any corporation until the par value thereof shall be fully paid in in cash. Any corporation may, subject to the approval of the State Bank Commissioner, increase or reduce its capital stock in the manner hereinafter provided. In the case of a reduction, the capital stock shall not be reduced to less than the amount required by § 745 of this title. 38 Del. Laws, c. 94, §  13 ; Code 1935, §  2382; 49 Del. Laws, c. 120 ; 51 Del. Laws, c. 14 ; 64 Del. Laws, c. 386, §  2 ; § 747 Stockholders’ liability. The private property of the stockholders shall not be subject to the payment of the corporate debts except as otherwise provided in the articles of association. 38 Del. Laws, c. 94, §  14 ; Code 1935, §  2383; 5 Del. C. 1953, §  747; § 748 Dividends. The directors of a bank or trust company may declare dividends on common or preferred stock of so much of the net profits of the corporation as they shall judge expedient; but the corporation shall, before the declaration of a dividend on common stock from the net profits, carry 50% of its net profits of the preceding period for which the dividend is paid to its surplus fund until the same shall amount to 50% of its capital stock; and thereafter shall carry 25% of its net profits of the preceding period for which the dividend is paid to its surplus fund until the same shall amount to 100% of its capital stock. 32 Del. Laws, c. 103, §  19 ; 38 Del. Laws, c. 93, §  1(8) ; 38 Del. Laws, c. 94, §  28 ; Code 1935, §§  2307, 2397; 5 Del. C. 1953, §  748; 60 Del. Laws, c. 458, §  1 ; § 749 Amendment of charter. (a) Banks and trust companies heretofore or hereafter created by or under this Code or any other special act or general law of this State, except as provided in Chapters 15 or 16 of this title, shall hereafter amend their charters, certificates of incorporation, certificates of formation or articles of association by and under this section. (b) Any bank or trust company in this State whether created under this chapter or by special act of the General Assembly (but not under Chapters 15 or 16 of this title), may, from time to time, when and as desired, amend its charter, certificate of incorporation or articles of association relating to the regulation and governance of corporations established under Title 8, or, in the case of a trust company that is a limited liability company, its certificate of formation or articles of association relating to regulation and governance of limited liability companies formed under Title 6, in each case where the same are not inconsistent with the express provisions of this chapter, including, but not limited to, addition to its corporate powers and purposes, or diminution thereof, or both (provided such additional corporate power or purpose to be such as is authorized or contemplated under any of the provisions of this chapter); or by increasing or decreasing its authorized capital stock (provided that such increase or decrease be expressly approved by the State Bank Commissioner, and provided also that the capital stock shall not be reduced below the amount prescribed by § 745 of this title); by changing the number or par value of its shares of stock; or by changing its corporate title (provided that the word “savings” shall not be used in the amended title, and provided further that no corporation not authorized to do a trust company business shall use the word “trust” in its amended title); and by increasing or decreasing its number of directors (provided that in no case shall the whole number of directors be less than 5). Any or all such changes or alterations may be effected by 1 certificate of amendment. No amendment shall contain a provision which would not have been lawful and proper to insert in an original charter, certificate of incorporation, certificate of formation or articles of association adopted granted or issued under this chapter, but nothing contained in this section shall prohibit the increase in capital stock of a trust company organized prior to February 28, 1933 and authorized by a certificate issued by the State Bank Commissioner to transact the business of a trust company on January 1, 1997, to any amount which may be less than required in § 745 of this title. In the case of an increase of capital stock, the amendment may provide that the increased stock may in whole or in part be disposed of without being offered to the stockholders, but in no case shall any stock be issued except upon payment in full in cash. (c) The procedure for amendment and the manner of making and effecting the same shall be as prescribed in Chapter 1 of Title 8 for the amendment of the certificate of incorporation of a corporation having a capital stock or, in the case of a trust company that is a limited liability company, as prescribed in Chapter 18 of Title 6 for the amendment of the certificate of formation or limited liability company agreement of a limited liability company. No certificate of amendment shall be received or filed by the Secretary of State or be deemed or held to be effective unless and until the proposed certificate of amendment shall have been submitted to the State Bank Commissioner and shall have been approved both in substance and in form by said Commissioner. 38 Del. Laws, c. 94, §§  3, 30 ; Code 1935, §§  2372, 2399; 46 Del. Laws, c. 251, §  3 ; 5 Del. C. 1953, §  749; 49 Del. Laws, c. 121 ; 51 Del. Laws, c. 15 ; 57 Del. Laws, c. 740, §  19A ; 64 Del. Laws, c. 386, §  3 ; 66 Del. Laws, c. 26, §  1 ; 71 Del. Laws, c. 19, §  21 ; 71 Del. Laws, c. 25, §§  9, 10 ; 76 Del. Laws, c. 383, §§  9-13 ; § 750 Merger and consolidation [Repealed]. Repealed by 70 Del. Laws, c. 327, § 4, eff. May 2, 1996. § 751 Acquisition or sale of assets, assumption of liabilities, consolidation and merger; Commissioner’s approval; title to property. (a) No bank or trust company doing business in this State, whether or not organized under this chapter, shall merge or consolidate with, sell any substantial portion of its assets to, or take over any substantial portion of the assets and/or assume the liabilities, in whole or in part, of any other bank or trust company, savings bank, national bank, federal savings association (as defined in the Home Owners’ Loan Act, 12 U.S.C. § 1461 et seq.) or out-of-state bank (as defined in § 795 of this title) (whether any of the foregoing is then doing business or has ceased to do business or has surrendered its charter or has dissolved) unless and until such action shall be approved by the State Bank Commissioner. (b) The Commissioner may require that he or she be furnished with such information as to the assets and liabilities and as to the condition of the banks or trust companies concerned as he or she deems necessary or proper to determine whether to give or withhold his approval. The State Bank Commissioner shall refuse his or her approval whenever in his opinion the transaction will weaken or tend to weaken any bank or trust company concerned. (c) No title to any property shall pass where the transaction is in violation of this section. 37 Del. Laws, c. 131, §  1 ; 32 Del. Laws, c. 103 ; Code 1935, §  2314; 5 Del. C. 1953, §  751; 70 Del. Laws, c. 112, §§  6, 7 ; § 752 Fees for merger, consolidation or acquisition of assets and assumption of liabilities [Repealed]. Repealed by 70 Del. Laws, c. 327, § 4, eff. May 2, 1996. Delaware General Assembly Judicial Executive Contact Twitter Help function submitSearch() { if (!window.location.origin) { window.location.origin = window.location.protocol + "//" + window.location.hostname + (window.location.port ? ':' + window.location.port : ''); } keyword = document.getElementById('srch-term').value; window.location.href = "/Search?query=" + keyword; } document.getElementById('srch-term').onkeyup = function (e) { if (e.keyCode == 13) { submitSearch(); } } § 761 General powers of corporations organized under this chapter. (a) A corporation established under and in compliance with this chapter shall have power to: (1) Sue and be sued, complain and defend in any court of law or equity; (2) Make and use a common seal and alter the same at pleasure; (3) Hold, purchase, convey, mortgage or lease real and personal property; (4) Borrow and lend money; (5) Discount bills, promissory notes or other evidences of debt; (6) Receive deposits of money either on time or demand; (7) Buy and sell gold and silver bullion and foreign money and coin; (8) Purchase securities for the investment of the funds under its control and sell the same; (9) Take mortgages and obligations of all kinds for payment of money for the investment of funds under its control and sell the same; (10) Receive for safekeeping securities and all types of choses in action and all kinds of personal property; (11) Keep deposit boxes and rent them to customers or patrons; (12) Engage in the sale, distribution and underwriting of, and deal in, stocks, bonds, debentures, notes or other securities; (13) Exercise the powers and engage in the activities permissible for such corporations through 1 or more subsidiaries; (14) Act as an insurer and transact the business of insurance in accordance with the provisions of Title 18; except that no corporation established under and in compliance with this chapter shall have power to act as a title insurer and transact the business of title insurance; (15) Act as guarantor or surety for the debt or obligation of another, including specifically but without limitation the rediscounting with recourse of commercial paper and the issuance of letters of credit as defined in § 5-103(1)(a) of Title 6 and standby letters of credit. As used herein, the term “standby letter of credit” includes every letter of credit (or similar arrangement however named or designated) which represents an obligation to the beneficiary on the part of the issuer to repay money borrowed by or advanced to or for the account of the customer, or to make payment on account of any evidence of indebtedness undertaken by the customer, or to make payment on account of any default by the customer in performance of an obligation. The terms “beneficiary,” “issuer” and “customer” as used herein have the same meaning as in § 5-103(1) of Title 6; and (16) Authorize an affiliated insured depository institution (as those terms are defined in § 796 of this title) to engage in the authorized agency activities provided in § 796A of this title. (17) Generally, use, exercise and enjoy all of the powers, rights, privileges and franchises incident to a banking corporation and, if established as a trust company, incident to a trust company, and which are necessary or proper for the transaction of the business of the corporation. (b) All powers conferred by this section are subject to and are to be construed as qualified by the limitations, restrictions and regulations prescribed by the Commissioner or in other sections of this chapter or by this Code or any other statute of this State providing regulations for banks and trust companies. (c) For the purposes of this subchapter, “personal property” includes digital assets. 38 Del. Laws, c. 94, §  15 ; Code 1935, §  2384; 5 Del. C. 1953, §  761; 66 Del. Laws, c. 27, §  6 ; 67 Del. Laws, c. 223, §  2 ; 70 Del. Laws, c. 112, §  8 ; 85 Del. Laws, c. 337, § 9 ; § 762 Ownership of real estate used for transaction of business. A corporation established under this chapter may hold real estate suitable for the transaction of its business; but, if the aggregate amount invested and proposed to be invested therein, including the cost of alterations and additions in the nature of permanent fixtures, exceeds, directly or indirectly, 50 percent of its capital, surplus and undivided profit accounts, the excess investment shall be made only with the approval of the State Bank Commissioner. The amount of money invested by the corporation in the securities of any corporation, trust or other organization which holds real estate in whole or in part used for the transaction of the business of the corporation or intended for such use, shall be included in determining the amount of real estate that may be held by the corporation under this section. 38 Del. Laws, c. 94, §  19 ; Code 1935, §  2388; 5 Del. C. 1953, §  762; 62 Del. Laws, c. 3, §  3 ; § 763 Membership in Federal Reserve System. (a) Any bank or trust company incorporated under this Code or any other laws of this State may become a member of the Federal Reserve Bank, organized or to be organized in the Federal Reserve District in which such bank or trust company is located, under the act of Congress known as the Federal Reserve Act, approved December 23, 1913, and such bank or trust company may subscribe for, purchase, hold and surrender, from time to time, such amounts of the capital stock of such Federal Reserve Bank as the bank or trust company may deem advisable or as may be required under the Federal Reserve Act, or any amendment thereof, in order to obtain and continue such membership, and upon the purchase of such stock, to assume the liabilities and become entitled to the benefits recited in the Federal Reserve Act. (b) Any corporation which becomes a member of the Federal Reserve System may, while it continues as a member bank of the System, have and exercise any and all of the corporate powers and privileges which may be exercised by member banks of the System. 28 Del. Laws, c. 107, §  1 ; 38 Del. Laws, c. 94, §  21 ; Code 1935, §§  2273, 2390; 5 Del. C. 1953, §  763; § 764 Capital notes or debentures. (a) With the approval of the State Bank Commissioner, any bank or trust company in this State, whether or not organized under this chapter, may at any time through action of its board of directors and without requiring any action of its stockholders issue and sell its capital notes or debentures. The capital notes or debentures shall be subordinate and subject to the claims of depositors and may be subordinated and subjected to the claims of other creditors. (b) The term “capital” as used in this Code and any other laws of this State relating to banking shall be construed to embrace the amount of outstanding capital notes and debentures legally issued by any bank or trust company in this State and sold by it. The capital stock of any bank or trust company may be deemed to be unimpaired when the amount of the capital notes and debentures as represented by cash or sound assets exceeds the impairment as found by the State Bank Commissioner. Before any capital notes or debentures are retired or paid by the bank or trust company, any existing deficiency of its capital (disregarding the notes or debentures to be retired) must be paid in cash, to the end that the sound capital assets shall at least equal the capital stock of the bank or trust company. (c) The capital notes or debentures shall in no case be subject to any assessment. The holders of capital notes or debentures shall not be held individually responsible as such holders for any debts, contracts, or engagements of the bank or trust company and shall not be held liable for assessments to restore impairments in the capital of the institution. 40 Del. Laws, c. 149, §  1 ; Code 1935, §  2407; 5 Del. C. 1953, §  764; 63 Del. Laws, c. 3, §  4 ; § 765 Power of trust company. In the case of a corporation established as a trust company under this chapter, the powers conferred by § 761 of this title shall include the right or power to be appointed executor of a will, codicil or writing testamentary, administrator with the will annexed or administrator of the estate of any decedent, receiver, assignee, guardian, conservator or trustee by will or by any written instrument or other act of the parties, or by any court or official, under the same circumstances, in the same manner, and subject to the same control by the court having jurisdiction of the same, as a legally qualified individual. 38 Del. Laws, c. 94, §  22 ; Code 1935, §  2391; 5 Del. C. 1953, §  765; § 766 Power of trust company to act as agent, registrar, trustee, etc. A trust company established under this chapter may act as agent for the purpose of issuing, registering or countersigning the certificates of stock, bonds, or other evidences of indebtedness of a corporation, association, municipal corporation, state or national government, on such terms as may be agreed upon, and may also act as trustee for the bondholders of a corporation, and for such purpose may receive transfers of real and personal property upon such terms as may be agreed upon. 38 Del. Laws, c. 94, §  25 ; Code 1935, §  2394; 5 Del. C. 1953, §  766; § 767 Limitations on powers and activities of banks and trust companies. (a) Any bank or trust company which engages in any activity authorized by § 761(a)(14) of this title otherwise than through a subsidiary thereof shall engage in each such activity through a department or division which shall maintain financial records separate and distinct from other records of such bank or trust company; provided, that such division may be established and may engage in each such activity only in accordance with the provisions of Title 18. (b) A bank or trust company which engages in any activity authorized by § 761(a)(14) of this title, whether through a department, division or subsidiary, may make loans to and transact other business with such department, division or subsidiary, provided such loan or other transaction is made on terms and under circumstances substantially the same as for comparable transactions with or involving other customers, or, in the absence of comparable transactions, upon terms and under circumstances that in good faith would be offered to or would apply to other customers. (c) No department, division or subsidiary of a bank or trust company which engages in any activity authorized by § 761(a)(14) of this title shall utilize in any manner or for any purpose the information contained in any insurance contract between a nonaffiliated insurer and the insured which such company has obtained from the insured in connection with any request for an extension of credit. (d) No bank or trust company which engages in any activity authorized by § 761(a)(14) of this title shall, in evaluating any request or application for the extension of credit, discriminate against an applicant on the basis that such applicant is a competitor of such bank or trust company in any such activity. (e) The offer to sell or the sale of any insurance product authorized to be sold under this section shall be made only by those individuals who are validly licensed as insurance agents or brokers in the State or other jurisdiction in which the sale of insurance is offered or consummated. The offer to sell insurance products shall include, but not be limited to, solicitation by mail, telephone, electronic or print media, and by personal contact. Violation of this subsection shall subject the violator and the employer of the violator to the penalties prescribed in Title 18 for solicitation or sale of insurance and the receipt or payment of commissions to unauthorized persons, if the violation occurred in this State. The Banking Commissioner and the Insurance Commissioner shall be charged to advise regulators in other states or jurisdictions when it is discovered that such violations have occurred in such other state or jurisdiction. 38 Del. Laws, c. 94, §§  16, 26 ; Code 1935, §§  2385, 2395; 5 Del. C. 1953, §  767; 63 Del. Laws, c. 3, §  5 ; 66 Del. Laws, c. 27, §  7 ; 67 Del. Laws, c. 223, §  4 ; 67 Del. Laws, c. 224, §§  1, 2 ; 70 Del. Laws, c. 112, §  9 ; 71 Del. Laws, c. 254, §  8 ; § 768 Loans on security of and purchase of its own capital stock. No corporation established under this chapter or under Chapter 15 of this title shall directly or indirectly make a loan or discount on the security of the shares of its own capital stock, nor be the purchaser or holder of such shares, unless such security or purchase shall be necessary to prevent loss upon a debt previously contracted in good faith. The stock so purchased or acquired shall, within 6 months after its purchase or acquisition, be sold or disposed of at public or private sale. Notwithstanding the foregoing, the Commissioner may approve the purchase by such a corporation of the shares of its own capital stock, subject to such terms and conditions, if any, as the Commissioner may require. 38 Del. Laws, c. 94, §  18 ; Code 1935, §  2387; 5 Del. C. 1953, §  768; 64 Del. Laws, c. 42, §  4 ; 71 Del. Laws, c. 19, §  22 ; 80 Del. Laws, c. 1, §  1 ; § 769 Ownership of capital stock of another bank or trust company. No bank or trust company shall hold more than 10 percent of the capital stock of any other bank or trust company without the approval of the Commissioner. In determining whether to grant such approval, the Commissioner shall consider the convenience and needs of the public of this State. Any acquisition by a bank or trust company of more than 10 percent of the capital stock of any other bank or trust company that was approved by the Commissioner before January 1, 1996, shall be deemed to have been approved by the Commissioner without the survival of any conditions required by former subsection (b) of this section. 32 Del. Laws, c. 103, §  21 ; 38 Del. Laws, c. 93, §  1(8) ; 38 Del. Laws, c. 94, §  29 ; Code 1935, §§  2309, 2398; 5 Del. C. 1953, §  769; 64 Del. Laws, c. 386, §  4 ; 64 Del. Laws, c. 461, §  1 ; 68 Del. Laws, c. 303, §  11 ;