The certificate of incorporation of a close corporation may provide that the business of the corporation shall be managed by the stockholders of the corporation rather than by a board of directors. So long as this provision continues in effect:
(1) No meeting of stockholders need be called to elect directors;
(2) Unless the context clearly requires otherwise, the stockholders of the corporation shall be deemed to be directors for purposes of applying provisions of this chapter; and
(3) The stockholders of the corporation shall be subject to all liabilities of directors.
Such a provision may be inserted in the certificate of incorporation by amendment if all incorporators and subscribers or all holders of record of all of the outstanding stock, whether or not having voting power, authorize such a provision. An amendment to the certificate of incorporation to delete such a provision shall be adopted by a vote of the holders of a majority of all outstanding stock of the corporation, whether or not otherwise entitled to vote. If the certificate of incorporation contains a provision authorized by this section, the existence of such provision shall be noted conspicuously on the face or back of every stock certificate issued by such corporation.
Structure Delaware Code
Chapter 1. GENERAL CORPORATION LAW
Subchapter XIV. Close Corporations; Special Provisions
§ 341. Law applicable to close corporation.
§ 342. Close corporation defined; contents of certificate of incorporation.
§ 343. Formation of a close corporation.
§ 344. Election of existing corporation to become a close corporation.
§ 345. Limitations on continuation of close corporation status.
§ 347. Issuance or transfer of stock of a close corporation in breach of qualifying conditions.
§ 348. Involuntary termination of close corporation status; proceeding to prevent loss of status.
§ 349. Corporate option where a restriction on transfer of a security is held invalid.
§ 350. Agreements restricting discretion of directors.
§ 351. Management by stockholders.
§ 352. Appointment of custodian for close corporation.
§ 353. Appointment of a provisional director in certain cases.
§ 354. Operating corporation as partnership.