HB 7311 Summary

• Revises director duty standards by requiring directors to act in good faith and in the corporation's best interests, with explicit standards for reliance on delegated authority and board committee performance, effective October 1, 2017.

• Establishes new procedures for ratifying and validating defective corporate actions (actions void due to authorization failures or share overissuance) through board and shareholder approval, with a 120-day claim period after validation becomes effective.

• Creates liability standards limiting director exposure by requiring plaintiffs to prove lack of good faith, inadequate decision-making, lack of independence, failure of oversight, or improper financial benefit to establish director liability.

• Permits corporations to adopt charter provisions limiting or eliminating the duty of directors and officers to offer business opportunities to the corporation, subject to board approval for certain officer situations.

• Authorizes merger and share exchange transactions without shareholder approval when an acquirer makes a public tender offer meeting specified thresholds, effective October 1, 2017.

• Updates limited liability company law regarding registered agent resignation, foreign registration procedures, and merger processes, with terminology changes from "statements" to "certificates," effective July 1, 2017.