How to Incorporate in Delaware
|---| | Designator | Must include "corporation," "incorporated," "company," "limited," or abbreviation | | Prohibited Words | "Bank" (with limited exceptions for regulated entities) | | Distinguishability | Must be unique on Division of Corporations records | | Reservation Fee | $75.00 | | Reservation Duration | 120 days | | Search Tool | https://icis.corp.delaware.gov/Ecorp/EntitySearch/NameSearch.aspx |
Step 1: Prepare Your Certificate of Incorporation
Your Certificate of Incorporation is the foundational document that establishes your Delaware corporation. Under 8 Del. C. § 102, you must include specific required information and can add optional provisions that govern how your corporation operates. The Delaware Division of Corporations will review this document before approving your incorporation.
Required Information
Your Certificate must include six mandatory elements under 8 Del. C. § 102(a). First, your corporation's name must contain one of these words: "association," "company," "corporation," "club," "foundation," "fund," "incorporated," "institute," "society," "union," "syndicate," or "limited" (or abbreviations thereof). Your name must be distinguishable from all other entities on the Division of Corporations' records.
Second, you must provide the address of your registered office in Delaware and the name of your registered agent at that address. Your registered agent must be either a Delaware resident or a domestic/foreign corporation, LLC, LP, or other entity authorized to do business in Delaware.
Third, state your corporation's business purpose. You may simply state that your purpose is "to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of Delaware," which automatically authorizes all lawful business activities.
Fourth, specify your stock structure. If you're issuing one class of stock, state the total number of authorized shares and whether they have par value. If you're issuing multiple classes, specify the number of shares per class and the par value for each class under 8 Del. C. § 151.
Fifth, provide the name and mailing address of your incorporator (the person filing the Certificate).
Sixth, if your incorporator's powers terminate upon filing, list the names and mailing addresses of your initial directors who will serve until the first annual stockholders' meeting.
Optional Provisions
Your Certificate may also include management provisions, voting rules, director powers, and stockholder rights—essentially any provision permitted by Delaware law that you might otherwise include in your bylaws. This flexibility allows you to customize your governance structure at formation.
You may establish a classified board of directors, impose preemptive rights, require supermajority votes for certain actions, or set a specific corporate duration. Many Delaware corporations include a provision authorizing the board to fix the rights and preferences of future stock classes without stockholder approval.
Your certificate may include provisions eliminating or limiting director liability for monetary damages (except for breach of loyalty, intentional misconduct, or improper personal benefit). This exculpation clause is common in Delaware corporations and protects directors from personal liability for good-faith business decisions.
Preparing Your Document
You can prepare your Certificate yourself or use a service provider. The document must be executed and acknowledged in accordance with 8 Del. C. § 103. File it online through the Delaware Division of Corporations' eCorp system at https://icis.corp.delaware.gov/eCorp/, or submit a paper copy to:
Delaware Division of Corporations
John G. Townsend Bldg., 401 Federal Street, Suite 4
Dover, DE 19901
Phone: (302) 739-3073
The filing fee is $89.00. Processing typically takes 1-2 business days for online filings.
Step 1: Appoint Your Board of Directors
Delaware requires you to appoint at least one director when incorporating. Unlike many states, Delaware imposes no residency requirement—your director can live anywhere in the world. You'll name your initial director(s) in your Certificate of Incorporation if the incorporator's powers terminate upon filing, or you can elect them at your first stockholders' meeting.
Minimum Director Requirement
Delaware law requires a minimum of one director for your corporation under 8 Del. C. § 141(b). You can have as many directors as you wish, and you may structure them into classes if desired. This flexibility makes Delaware attractive for both single-founder startups and complex corporate structures.
Director Residency and Qualifications
Your directors do not need to be Delaware residents. They need not be stockholders of your corporation. Delaware imposes no citizenship requirements, age minimums, or professional qualifications. This means you have complete freedom in selecting your board composition.
Naming Directors in Your Certificate
If you want your incorporator's powers to terminate immediately upon filing, you must name your initial director(s) in your Certificate of Incorporation under 8 Del. C. § 102(a)(6). List each director's name and mailing address. This approach is common for startups that want the incorporator to have no ongoing role.
Alternatively, you can name an incorporator without naming initial directors. In this case, your incorporator will hold office until the first stockholders' meeting, at which point stockholders elect the permanent board.
Director Duties and Liability
Delaware law imposes fiduciary duties of care and loyalty on directors. However, your certificate may eliminate or limit personal liability for monetary damages for breach of the duty of care (but not loyalty or intentional misconduct). This exculpation clause protects directors from personal liability for good-faith business decisions.
Directors hold office until their successors are elected and qualified or until they resign or are removed. A majority of directors constitutes a quorum for board action unless your certificate or bylaws require a greater number. The board may act by written consent without a meeting under 8 Del. C. § 141(f).
Documenting Director Appointments
Once your corporation is formed, document all director appointments in your corporate records. Maintain a record of board meetings, resolutions, and any changes to board composition. While Delaware does not require you to file director information with the state, you must keep accurate records for your own corporate governance and tax purposes.
Step 1: File Your Certificate of Incorporation
You must file your Certificate of Incorporation with the Delaware Division of Corporations to officially create your corporation. This document establishes your company's legal existence and contains essential information about your business structure, ownership, and governance.
Where and How to File
Submit your Certificate of Incorporation to the Delaware Division of Corporations either online or by mail. The online filing system (eCorp) at https://icis.corp.delaware.gov/eCorp/ is the fastest method. You can also file by mail or in person at:
John G. Townsend Bldg.
401 Federal Street, Suite 4
Dover, DE 19901
Phone: (302) 739-3073
Filing Fee Structure
The filing fee for your Certificate of Incorporation is $89.00 under 8 Del. C. § 101. However, additional fees apply if your authorized shares exceed certain thresholds under 8 Del. C. § 391.
Fee calculation for authorized shares:
The filing fee is based on your authorized capital stock. For par value stock: $0.02 per share for the first 20,000 shares, $0.01 per share for shares 20,001–200,000, and $0.004 per share for shares over 200,000 (minimum $15). For stock without par value: $0.01 per share for the first 20,000 shares, $0.005 per share for shares 20,001–2,000,000, and $0.004 per share for shares over 2,000,000 (minimum $15).
Example: If you authorize 5,000,000 shares without par value, your fee is: (20,000 × $0.01) + (1,980,000 × $0.005) + (3,000,000 × $0.004) = $200 + $9,900 + $12,000 = $22,100. However, the maximum filing fee is $200,000 (or $250,000 for large corporate filers).
Processing Time
Delaware processes Certificate of Incorporation filings quickly. Online filings typically receive same-day or next-business-day approval. Standard mail filings may take 5-7 business days.
After Filing
Upon filing and payment of fees, your corporation legally exists. The Division issues a file-stamped copy of your Certificate as evidence of incorporation. Your corporation's existence is deemed to commence on the filing date under 8 Del. C. § 106.
Once approved, the Delaware Division of Corporations will return a certified copy of your Certificate of Incorporation. This document serves as proof of your corporation's legal existence. You'll need certified copies for opening a business bank account, obtaining an Employer Identification Number (EIN) from the IRS, and other business purposes.
Step 1: Appoint a Registered Agent and Office
You must appoint a registered agent and designate a registered office in Delaware before your corporation can operate legally. Under 8 Del. C. § 131, your registered agent serves as the official point of contact for legal documents and state correspondence. This requirement is non-negotiable and must be included in your Certificate of Incorporation.
Who Can Serve as Your Registered Agent
Delaware law permits three categories of registered agents:
Individual Delaware Residents
You may appoint any individual who maintains a physical address in Delaware. This person does not need to be a shareholder or director, but they must be a state resident.
Delaware Business Entities
You can designate a domestic Delaware corporation, LLC, limited partnership, or statutory trust as your registered agent. The entity must be authorized to conduct business in Delaware.
Foreign Entities
A foreign corporation, LLC, limited partnership, or statutory trust can serve as your registered agent if it's already authorized to do business in Delaware.
Physical Address Requirement
Your registered office must have a physical street address in Delaware—not a P.O. box. This address appears on your Certificate of Incorporation and becomes public record. You can use your principal place of business, a commercial office, or a registered agent service's address.
Professional Registered Agent Services
Many entrepreneurs use a professional registered agent service rather than serving as their own agent. This provides privacy (the agent's address appears on public filings, not your home address) and ensures documents are received and forwarded promptly. Professional agents typically charge $50–$150 annually.
Consent and Documentation
Your appointed registered agent must consent to the appointment. When you file your Certificate of Incorporation with the Delaware Division of Corporations, you're certifying that your agent has agreed to serve in this capacity.
Changing Your Registered Agent
If you need to replace your registered agent after incorporation, you'll file a Change of Agent form with the Division of Corporations under 8 Del. C. § 133. The filing fee is $50.00. Your new agent must also provide written consent before the change becomes effective.
Step 1: Adopt Bylaws
Delaware corporations must adopt bylaws to establish internal governance rules, though the specific bylaw requirements are not mandated by statute—you have significant flexibility in what you include. Your bylaws work alongside your Certificate of Incorporation to define how your corporation operates.
What Bylaws Cover
Your bylaws establish the operational framework for your corporation. They typically address director and shareholder meeting procedures, board composition and duties, officer roles and responsibilities, stock issuance rules, and amendment procedures. Under 8 Del. C. § 102(b)(1), any provision permitted in the Certificate of Incorporation may instead be included in your bylaws, giving you flexibility in how you structure governance.
When to Adopt Bylaws
You should adopt bylaws immediately after incorporating or before your first shareholder meeting. Your initial board of directors (named in your Certificate of Incorporation or elected at your organizational meeting) formally adopts bylaws through a board resolution. This typically happens at an organizational meeting held shortly after filing your Certificate of Incorporation with the Delaware Division of Corporations.
Key Bylaw Provisions
Include provisions addressing: the number and election of directors (Delaware requires a minimum of 1 director per 8 Del. C. § 141), the timing and notice requirements for board and shareholder meetings, the powers and duties of officers, the classes and issuance of stock, dividend policies, and the process for amending bylaws. You may also include provisions addressing indemnification of directors and officers, which Delaware law permits under 8 Del. C. § 102(b)(1).
Many Delaware corporations adopt bylaws that provide maximum flexibility. For example, bylaws may authorize the board to set the number of directors (within a range), allow board action by written consent without a meeting, and permit stockholder action by written consent under 8 Del. C. § 228.
Bylaw Amendment Process
Your bylaws should specify how they can be amended. Typically, bylaws may be amended by either the board of directors or shareholders, depending on what your Certificate of Incorporation and bylaws themselves provide. Delaware law allows considerable flexibility here—you control the amendment process through your initial bylaw language.
No State Filing Required
Unlike your Certificate of Incorporation, you do not file bylaws with the Delaware Division of Corporations. You keep bylaws as internal corporate records. However, you must make them available to shareholders and directors as required by Delaware law, and you should maintain a copy at your registered office address listed in your Certificate of Incorporation.
Step 1: Issue Stock Certificates
Stock certificates represent ownership in your Delaware corporation and must be issued to shareholders who have paid for their shares. Delaware law does not mandate a specific format for certificates, but they should clearly identify the corporation, shareholder name, number of shares, and class of stock.
Certificate Contents
Your stock certificates should include the corporation's name, the shareholder's name, the number and class of shares issued, and any restrictions on transfer. While Delaware's General Corporation Law (8 Del. C. § 101 et seq.) does not prescribe exact certificate language, certificates serve as evidence of ownership and should reference your Certificate of Incorporation's authorized share structure.
Timing of Issuance
Issue certificates after your board of directors approves the issuance and the shareholder pays the agreed consideration. This typically occurs at your first board meeting or during the initial capitalization of the corporation. Certificates can be issued for par value shares, no-par shares, or any combination authorized in your Certificate of Incorporation.
Physical or Digital Format
Delaware permits both physical certificates and book-entry (uncertificated) shares. Many modern corporations maintain digital records rather than issuing physical certificates. If you choose physical certificates, ensure they are signed by authorized officers (typically the president and secretary) and include the corporate seal.
Consideration for Shares
Stockholders must pay for their shares. Payment may be in cash, property, services rendered, or promissory notes under 8 Del. C. § 152. Document the consideration paid to avoid later disputes. If a stockholder receives shares for services, document the agreement and the value assigned to those services.
Stock Restrictions
You may impose transfer restrictions on stock (e.g., requiring board approval for sales, granting the corporation a right of first refusal, or restricting sales to competitors). Any restrictions must be noted on the stock certificate or the corporation must provide written notice to the stockholder. Restrictions are enforceable if reasonable and properly disclosed.
Record-Keeping Requirements
Maintain a stock ledger showing each shareholder's name, address, number of shares, class of stock, and date of issuance. This record must be available for shareholder inspection and supports your annual franchise tax filings with the Delaware Division of Corporations.