Richards, Layton & Finger sent along an update memorandum by email reporting that:
Legislation proposing to amend the General Corporation Law of the State of Delaware (the “DGCL”) is expected to be introduced to the Delaware General Assembly for consideration during its 2023 regular session. If enacted, the 2023 amendments to the DGCL will, among other things, make the following changes:
- Sections 152, 153 and 157 (as well as Section 160(b)) will be revised to make clarifying changes with respect to the creation and issuance of stock and rights and options to purchase stock, including confirming that a corporation is not required to receive the statutory minimum consideration (typically the par value) for a disposition of treasury shares.
I am surprised there was enough doubt so as to justify amending not just one section but four. After all, Folk on. the Delaware General Corporation Law tells us at GCL-368 that:
Par shares held in treasury can be reissued at less than par because there is no need to demand the statutorily required consideration another time.
This is so because the when par stock is redeemed or repurchased the capital attributable to that stock remains on the balance sheet as capital.
