Bill > SB21

This bill amends Delaware's General Corporation Law to provide clearer guidelines and safe harbor procedures for corporate transactions involving directors, officers, and controlling stockholders. Specifically, the bill establishes detailed criteria for determining when transactions with potential conflicts of interest can be approved and protected from legal challenges. The legislation introduces precise definitions for terms like "controlling stockholder," "control group," and "disinterested director," and outlines specific procedures for approving transactions that might otherwise be considered problematic. The bill allows such transactions to be validated through approval by disinterested directors or stockholders, or by demonstrating that the transaction is fair to the corporation and its stockholders. Importantly, the bill limits monetary damages that can be sought against controlling stockholders for breach of duty of care, while preserving other legal protections. The amendments aim to provide corporations with more clarity and predictability in handling complex corporate transactions, particularly those involving potentially conflicted parties, by establishing clear standards for review and approval.

Justice

https://legis.delaware.gov/BillDetail?LegislationId=141857