Here’s an excerpt from this lengthy piece on Cooley’s CapitalXchange that explores the impact of the recent Delaware, Texas and Nevada state changes relating to in which state a company might want to be incorporated in: “Senate Bill 21 also makes changes to Section 220 of the DGCL, relating to the inspection of books and records, including the following:
- Restricts the scope of books and records requests. Addressing an issue previously undefined in statute, Senate Bill 21 amends Section 220 to expressly enumerate the categories of “books and records” that can be requested.
- Imposes a three-year lookback period. The amendments cap stockholder access to records at three years.
- Procedural requirements for books and records requests. The amendments codify the requirement that a stockholder demand be made in good faith and for a proper purpose and must describe the purpose and records sought “with reasonable particularity.”
Our securities litigation + enforcement colleagues provided their two cents on these amendments shortly after Senate Bill 21 was enacted as well.
But don’t hang up your coat just yet, since the constitutionality of these amendments has been questioned, and the Delaware Supreme Court has taken up the challenge.”
Authored by
Broc Romanek