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DelawareSB 21153rd General Assembly (2024–2026)SenateWALLET

AN ACT TO AMEND TITLE 8 OF THE DELAWARE CODE RELATING TO THE GENERAL CORPORATION LAW.

Sponsored By: Bryan Townsend (Democratic)

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Bill Overview

Analyzed Economic Effects

5 provisions identified: 1 benefits, 2 costs, 2 mixed.

Broader corporate records access for directors

Directors can examine stock ledgers, stockholder lists, books, and other corporate records for a purpose tied to their role. The Court of Chancery alone decides disputes over this access. The corporation must prove that the director has an improper purpose.

Fewer damage claims against controlling stockholders

Controlling stockholders and control-group members are shielded from money damages for duty-of-care breaches while acting as controllers. This narrows the money that corporations and other stockholders can recover through those claims. The shield excludes loyalty breaches, bad faith, intentional misconduct, knowing law violations, and deals producing an improper personal benefit. Courts retain authority to grant remedies other than money, such as orders stopping a deal.

Tighter corporate records access for stockholders

Stockholders must request records in good faith for a proper purpose tied to their ownership, specifically describing that purpose and the related records. The list covers governing documents, board and committee records and materials, specified corporate agreements, independence questionnaires, and three years of certain meeting records, stockholder communications, and annual financial statements. Beneficial owners must provide ownership evidence, and agents or attorneys must provide written authorization. Companies can set reasonable confidentiality and use limits, remove unrelated material, and require produced records to be treated as part of a related complaint. The Court of Chancery generally can order only listed records; when specified records are missing, it can order necessary and essential equivalents, while separate inspection and litigation discovery rights remain intact.

New corporate control and independence rules

A controlling stockholder holds majority voting power, including related holdings, or at least one-third plus equivalent control and managerial authority. Two or more people count as a control group when an agreement or understanding gives them control together. For exchange-listed companies, a board finding of independence under exchange rules creates a presumption that a director is disinterested. This applies only when the director is not a party to the deal; rebutting it requires substantial, specific facts. Nomination or election by an interested person alone does not show a conflict, and interested directors can count toward a quorum.

New protections for insider corporate deals

The law protects qualifying Delaware corporate deals from damages and other court remedies for covered conflicts or duty claims. Director or officer deals qualify through fairness, informed good-faith approval by a majority of disinterested directors, or an informed, uncoerced majority of disinterested stockholder votes cast. Controller deals other than going-private deals qualify through fairness, a qualifying board committee, or an informed, uncoerced majority of disinterested stockholder votes cast. The committee must know the material facts, oversee or negotiate the deal, have power to reject it, exclude the controller, and have a disinterested majority; the stockholder route requires making the deal conditional on that vote. Going-private deals require fairness or both approval routes; shares irrevocably accepted in covered tender offers count as votes in favor.

Sponsors & Cosponsors

Sponsor

  • Bryan Townsend

    Democratic • Senate

Cosponsors

  • Timothy D. Dukes

    Republican • House

  • Krista Griffith

    Democratic • House

  • Kerri Evelyn Harris

    Democratic • House

  • Gerald W. Hocker

    Republican • Senate

  • S. Elizabeth Lockman

    Democratic • Senate

  • Melissa Minor-Brown

    Democratic • House

  • Edward S. Osienski

    Democratic • House

  • Brian Pettyjohn

    Republican • Senate

  • Ray Seigfried

    Democratic • Senate

  • David P. Sokola

    Democratic • Senate

  • Jeffrey N. Spiegelman

    Republican • House

Roll Call Votes

No roll call votes available for this bill.

Actions Timeline

  1. SS 1 for SB 21 - Signed by Governor

    3/25/2025Governor

  2. SS 1 for SB 21 - Passed By House. Votes: 32 YES 7 NO 2 ABSENT

    3/25/2025House

  3. SS 1 for SB 21 - - Defeated By House. Votes: 8 YES 31 NO 2 ABSENT

    3/25/2025House

  4. SS 1 for SB 21 - - Stricken in House

    3/25/2025House

  5. SS 1 for SB 21 - - Defeated By House. Votes: 8 YES 31 NO 2 ABSENT

    3/25/2025House

  6. SS 1 for SB 21 - - Defeated By House. Votes: 8 YES 31 NO 2 ABSENT

    3/25/2025House

  7. SS 1 for SB 21 - - Defeated By House. Votes: 9 YES 30 NO 2 ABSENT

    3/25/2025House

  8. SS 1 for SB 21 - - Defeated By House. Votes: 6 YES 32 NO 1 NOT VOTING 2 ABSENT

    3/25/2025House

  9. SS 1 for SB 21 - - Stricken in House

    3/25/2025House

  10. Substituted in Senate by SS 1 for SB 21

    3/25/2025Senate

  11. SS 1 for SB 21 - Reported Out of Committee (Judiciary) in House with 9 On Its Merits

    3/19/2025House

  12. Substituted in Senate by SS 1 for SB 21

    3/18/2025Senate

  13. SS 1 for SB 21 - Assigned to Judiciary Committee in House

    3/13/2025House

  14. SS 1 for SB 21 - Passed By Senate. Votes: 20 YES 1 ABSENT

    3/13/2025Senate

  15. SS 1 for SB 21 - Reported Out of Committee (Judiciary) in Senate with 2 Favorable, 2 On Its Merits

    3/12/2025Senate

  16. Substituted in Senate by SS 1 for SB 21

    3/12/2025Senate

  17. Introduced and Assigned to Judiciary Committee in Senate

    2/17/2025Senate

Bill Text

  • Current

    2/17/2025

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