The Delaware Court of Chancery issued its decision in In re Tesla Motors, Inc., on April 27, 2022, rejecting claims that Tesla, Inc. CEO Elon Musk breached his fiduciary duties to Tesla’s stockholders as a director and an...more
5/11/2022
/ Acquisition Agreements ,
Breach of Duty ,
Business Litigation ,
Controlling Stockholders ,
Corporate Sales Transactions ,
Elon Musk ,
Energy Sector ,
Entire Fairness Standard ,
Fiduciary Duty ,
Merger Agreements ,
Purchase Price ,
SolarCity ,
Tesla
Key Takeaways: The Third, Sixth, Seventh, and Ninth Circuit Courts of Appeals have recognized the doctrine of federal common law successor liability for claims brought under certain federal labor and employment statutes,...more
On June 5, 2020, President Trump signed into law the Paycheck Protection Program Flexibility Act of 2020 (the “PPP Flexibility Act”). The PPP Flexibility Act makes a handful of significant changes to the Paycheck Protection...more
The Federal Reserve Bank (the “Fed”) and the U.S. Department of the Treasury (the “Treasury”) announced preliminary details for the Main Street Lending Program (the “MSLP”) on April 9, 2020. Additional details and guidance as...more
5/8/2020
/ Borrowers ,
CARES Act ,
Coronavirus/COVID-19 ,
EBITDA ,
Eligibility ,
Federal Reserve ,
Financial Stimulus ,
Lenders ,
Main Street Lending Programs ,
Main Street New Loan Facility ,
Midsize and Large Business Loans ,
Relief Measures ,
Special Purpose Vehicles ,
Term Sheets ,
U.S. Treasury
In Marchand v. Barnhill et al. (“Blue Bell”),1 the Delaware Supreme Court on June 19 unanimously reversed the dismissal of a shareholder derivative lawsuit against the members of the board of directors and two officers of...more
7/1/2019
/ Appeals ,
Bad Faith ,
Blue Bell Creameries ,
Board of Directors ,
Breach of Duty ,
Caremark claim ,
Compliance ,
Corporate Counsel ,
DE Supreme Court ,
Demand Futility ,
Derivative Suit ,
Dismissals ,
Duty of Loyalty ,
Food Manufacturers ,
Food Poisoning ,
Food Safety ,
Independent Director ,
Listeria ,
Product Recalls ,
Reversal ,
Shareholder Litigation ,
Wrongful Death
In a decision with potentially far-reaching implications for private equity sponsors and other controlling stockholders, the Delaware Court of Chancery expanded the potential for liability for foreign-based controllers by...more
4/5/2019
/ Acquisitions ,
Arm's Length Principle ,
Board of Directors ,
Breach of Duty ,
Business Judgment Rule ,
Bylaws ,
Civil Liability ,
Controlling Stockholders ,
Entire Fairness Standard ,
Fiduciary Duty ,
Foreign Subsidiaries ,
Forum Selection ,
Implied Consent ,
Minority Shareholders ,
Motion to Dismiss ,
Personal Jurisdiction ,
Private Equity ,
Self-Dealing ,
Shareholder Approval ,
Standard of Review ,
Subsidiaries
In the Spring 2017 edition of Dechert’s Global Private Equity Newsletter, we reviewed the Delaware Court of Chancery’s decision in Chicago Bridge & Iron Company N.V. v. Westinghouse Electric Company LLC and WSW Acquisition...more
10/7/2017
/ Auditors ,
Buyers ,
Contract Drafting ,
DE Supreme Court ,
GAAP ,
Indemnification Clauses ,
Merger Agreements ,
Private Equity ,
Purchase Price ,
Purchase Price Adjustment ,
Representations and Warranties ,
Sellers
Crucial to any private equity seller is certainty: the certainty that a sale will be consummated at an agreed price and that any potential post-closing liability is fully understood in advance of distributing proceeds to...more
10/3/2017
/ Buyers ,
Carve Out Provisions ,
Contract Drafting ,
Contract Terms ,
Fraud ,
Indemnification ,
Private Equity ,
Purchase Agreement ,
Representations and Warranties ,
Risk Mitigation ,
Sellers
It is common practice for purchase agreements in private company M&A transactions to contain one set of rules to determine and resolve disputes regarding a post-closing purchase price adjustment and a separate, often vastly...more
4/13/2017
/ Acquisitions ,
Breach of Contract ,
Buyers ,
Closing Adjustment Cost ,
Contract Drafting ,
Contract Terms ,
GAAP ,
Mergers ,
Non-GAAP Financial Measures ,
Nuclear Power ,
Power Plants ,
Power Purchase Agreements ,
Purchase Agreement ,
Purchase Price ,
Representations and Warranties ,
Sellers
A recent decision from the Delaware Chancery Court adds a twenty-first century interpretation to the common law doctrine of consequential damages which has roots reaching back to English contract law. This decision highlights...more
4/8/2017
/ Acquisitions ,
Buyers ,
Common Law Claims ,
Consequential Damages ,
Contract Drafting ,
Contract Terms ,
Damages ,
Foreseeability ,
Mergers ,
Sellers ,
Stock Purchase Agreement
It is not unexpected for there to be requirements in consumer contracts that clear formulations of waivers are necessary before a consumer can be deprived of rights. However, under Delaware law similar formality and clarity...more
Representation and warranty insurance (R&WI) has become an integral component of the M&A landscape and is here to stay. The data speaks for itself: in 2014, more than 700 U.S. R&WI policies were issued, which was double the...more
8/19/2015
/ Acquisitions ,
Buyers ,
Commercial Insurance Policies ,
Escrow Accounts ,
Indemnification ,
Indemnification Clauses ,
Mergers ,
Representations and Warranties ,
Risk Allocation ,
Scope of Coverage ,
Sellers ,
Underwriting
This article originally was published in the Winter 2015 Edition of the Dechert Private Equity Newsletter but has been updated to reflect recent guidance from the U.S. Commerce Department’s Bureau of Economic Affairs (BEA) on...more
4/23/2015
/ BEA ,
Covered Transactions ,
Filing Deadlines ,
Foreign Direct Investment ,
Foreign Investment ,
Foreign Ownership ,
Form BE-10 ,
Form BE-13 ,
Private Equity ,
Private Equity Funds ,
Reporting Requirements ,
U.S. Commerce Department
With the globalization of the economy, most private equity funds are likely to own companies based in the United States that have operations or subsidiaries outside the United States, and/or have interests in non-U.S....more
Addressing an unsettled area of Delaware law, the Delaware Court of Chancery (the “Chancery Court”) revisited the appropriate standard of review for a going-private merger with a controlling stockholder....more
FINRA, the largest independent regulator for all securities firms doing business in the United States, has released a set of FAQs relating to its review of public securities offerings filed on its Public Offering Filing...more
2/15/2013
/ Conflicts of Interest ,
Disclosure Requirements ,
DPPs ,
Exemptions ,
Filing Fees ,
Financial Industry Regulatory Authority (FINRA) ,
Initial Public Offering (IPO) ,
Lock-Up Requirements ,
Public Offerings ,
REIT ,
Right of First Refusal ,
Securities and Exchange Commission (SEC) ,
Underwriting