The 2021 amendments to the Delaware General Corporation Law (DGCL), the Delaware Revised Uniform Partnership Act (DRUPA), the Delaware Revised Uniform Limited Partnership Act (DRULPA), and the Delaware Limited Liability Company Act (DLLCA and, together with the DRUPA and the DRULPA, the alternative entity statutes) went into effect Aug. 1. Below is a brief description of some of the more notable 2021 amendments. (No amendments were made to the Delaware Statutory Trust Act in 2021.)
Amendments to the DGCL
- Corporation’s Own Stock for Purposes of Voting and Establishing a Quorum (Section 160(c)).
Section 160(c) of the DGCL was amended to clarify that if a corporation’s capital stock is held by another entity (whether a corporation or an alternative entity) and the corporation directly or indirectly holds a majority of the voting power of such entity, then such capital stock may not be voted or counted for the purposes of establishing a quorum.
Amendments to the Alternative Entity Statutes
- Applicability of Certain of the DRUPA’s Default Rules (Section 15-103 of the DRUPA).