Delaware Code

8 Del. C. § 154 (2026)

Determination of amount of capital; capital, surplus and net assets defined

✓ current as of May 2026

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Any corporation may, by resolution of its board of directors, determine that only a part of the consideration which shall be received by the corporation for any of the shares of its capital stock which it shall issue from time to time shall be capital; but, in case any of the shares issued shall be shares having a par value, the amount of the part of such consideration so determined to be capital shall be in excess of the aggregate par value of the shares issued for such consideration having a par value, unless all the shares issued shall be shares having a par value, in which case the amount of the part of such consideration so determined to be capital need be only equal to the aggregate par value of such shares. In each such case the board of directors shall specify in dollars the part of such consideration which shall be capital. If the board of directors shall not have determined (1) at the time of issue of any shares of the capital stock of the corporation issued for cash or (2) within 60 days after the issue of any shares of the capital stock of the corporation issued for consideration other than cash what part of the consideration for such shares shall be capital, the capital of the corporation in respect of such shares shall be an amount equal to the aggregate par value of such shares having a par value, plus the amount of the consideration for such shares without par value. The amount of the consideration so determined to be capital in respect of any shares without par value shall be the stated capital of such shares. The capital of the corporation may be increased from time to time by resolution of the board of directors directing that a portion of the net assets of the corporation in excess of the amount so determined to be capital be transferred to the capital account. The board of directors may direct that the portion of such net assets so transferred shall be treated as capital in respect of any shares of the corporation of any designated class or classes. The excess, if any, at any given time, of the net assets of the corporation over the amount so determined to be capital shall be surplus. Net assets means the amount by which total assets exceed total liabilities. Capital and surplus are not liabilities for this purpose. Notwithstanding anything in this section to the contrary, for purposes of this section and §§ 160 and 170 of this title, the capital of any nonstock corporation shall be deemed to be zero.

8 Del. C. 1953, § 154; 56 Del. Laws, c. 50; 59 Del. Laws, c. 106, § 2; 74 Del. Laws, c. 326, § 4; 77 Del. Laws, c. 253, § 15;

Notes of Decisions

Cited in 11 cases (3 in the last 5 years), 1953–2023 · leading case: Bennett v. Breuil Petroleum Corp., 99 A.2d 236 (Del. Ch. 1953).

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Bennett v. Breuil Petroleum Corp., 99 A.2d 236 (Del. Ch. 1953). “NOTES [1] 8 Del.C. § 154. [2] Grone v. Economic Life Ins.”

Dye v. Commc'ns Ventures III, LP (In re Flashcom, Inc.), 503 B.R. 99 (Bankr. C.D. Cal. 2013). “STOCK REDEMPTION UNDER DELAWARE LAW Under Delaware law, corporations may purchase or redeem their own shares, except when the capital of the corporation is impaired or when the purchase or redemption of shares would cause the capital of the corporation to be impaired.”

Georesearch, Inc. v. Morriss, 193 F. Supp. 163 (W.D. La. 1961). “Plaintiff corporation contends that “impairment of capital” in Section 160 must be interpreted in the light of Section 154, 8 Del. C. § 154 15 which defines capital in this *176 instance to be an amount “equal to the aggregate par value of such shares.”

United States v. Archer-Daniels-Midland Co., a Corp., 243 F.2d 130 (8th Cir. 1957). “” Section 14, Chapter 65, Revised Code of Delaware of 1935, 8 Del.C. § 154. Manifestly, the transfer here was in strict compliance with the provision of the Delaware statute.”

In re The Chemours Co. Derivative Litig. (Del. Ch. 2021). · cites it 4× ““Surplus” is “defined by 8 Del. C. § 154 to mean the excess of net assets over the par value of the corporation’s issued stock.”

The Frederick Hsu Living Trust v. ODN Holding Corp. (Del. Ch. 2017). · cites it 2× “if such shares will be retired upon their acquisition and the capital of the corporation reduced in accordance with §§ 243 and 244 of this title.”

Cont'l Investors Fund LLC v. Tradingscreen Inc. (Del. Ch. 2021). · cites it 2× “if such shares will be retired upon their acquisition and the capital of the corporation reduced in accordance with §§ 243 and 244 of this title.”

Carickhoff v. Cantor (Bankr. D. Del. 2023). · cites it 2× “11 repurchase exceed the amount of the corporation’s surplus, defined by 8 Del. C. § 154 to mean the excess of net assets over the par value of the corporation’s issued stock.”

TCV VI, L.P. v. TradingScreen, Inc. (Del. Ch. 2015). “It has invoked 8 Del. C. § 154 to avoid paying and asserts that full payment would threaten its ability to continue as a going concern.”

ESG Capital Partners II, LP (Del. Ch. 2015). “For the reasons discussed in the preceding section, the Favored LPs did not receive a distribution. They received preferential transfers.”

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