On March 13, 2025, the Delaware Senate unanimously approved proposed amendments to the Delaware General Corporation Law, which would, among other things, provide a new safe harbor for “interested” transactions involving officers, directors, controlling shareholders, and control groups; lower the current approval requirements for most interested transactions involving controlling stockholders and control groups; and impose new limits on books and records demands.

The state's Senate Bill 21 was introduced last month amid growing concerns that a number of Delaware companies (including some high-profile companies) were considering reincorporation, primarily in Nevada and Texas. The bill that was adopted by the Senate reflects certain changes proposed by the Council of the Corporation Law Section of the Delaware State Bar Association, but does not include certain contested language which would make the amendments applicable to pending cases. As written, the current bill will “not apply to or affect any action of proceeding commenced in a court of competent jurisdiction that is completed or pending, or any demand to inspect books and records made, on or before February 17, 2025.”

The bill will now be considered by the Delaware House on March 19 and 20.   

The proposed amendments have triggered a range of responses. While some view the amendments as a much-needed rebalancing of shareholder and management rights, others view them as a direct rebuke of the Delaware judiciary and an attack on the rights of minority investors.