MFW protects controlling-stockholder transactions even when a third-party bidder makes a competing bid that is superior to a negotiated merger with the controller. A special committee will likely satisfy the duty of care...more
In re Stream TV Networks, Inc. Omnibus Agreement Litig., C.A. No. 2020-0776-JTL (Del. Ch. Oct. 3, 2022) - Court of Chancery Rule 70 speaks to the Court’s discretion in fashioning sanctions for failure to comply with a...more
As discussed in this post, the California General Corporation Law defines and uses the term "common shares" rather than "common stock". Common shares are shares that have no preference over other shares with respect to...more
Surprisingly, the California General Corporation Law uses the term "common stock" as opposed to "common stock" in only a single statute. Section 159 of the California Corporations Code defines "common shares" as "shares...more
The NYSE has amended the Listed Company Manual regarding shareholder approval requirements for the issuance of securities and certain related party matters. The SEC approved the amendments on an accelerated basis....more
L-5 Healthcare Partners, LLC v. Alphatec Holdings, Inc., C.A. No. 2019-0412-KSJM (Del. Ch. Oct. 12, 2020) - Pursuant to a share purchase agreement, a plaintiff stockholder had preemption rights that entitled the...more
The second of a six-part series examining six specific and evolving rights plan provisions. As discussed in greater detail in some of our prior articles, a shareholder rights plan is a defensive measure used by a public...more
The SEC has declared immediately effective (yet another) proposed change to the rules of an exchange—this one from the NYSE. The NYSE has adopted new Section 312.03T of the NYSE Listed Company Manual, which will provide a...more
Suppose that the articles of incorporation provide that a corporation will have two classes of shares, with one class entitled to 90% of all dividends declared and assets upon liquidation and the other class to the remaining...more
Despite political and economic uncertainties, markets and deal activity were resilient in 2019, and strong fundamentals remain in place heading into 2020. Companies continue to face a challenging litigation and enforcement...more
In recent years, fintech has been an attractive sector for growth capital, as evidenced by robust investment and M&A valuations in the sector. While interest remained high in 2019, deal volumes began to level off early in the...more
Our Federal Tax Group reflects on the Third Circuit’s recent SIH Partners v. Commissioner ruling and suggests taking a second look at old Treasury regulations that might not survive judicial scrutiny....more
Section 1800 of the California Corporations Code provides a procedure for the involuntary dissolution of a corporation. The process begins with the filing of a verified complaint, but only those persons listed in the statute...more
The NYSE recently issued a proposal to amend Sections 312.03 and 312.04 of the Listed Company Manual (the “NYSE Manual”) to change the circumstances in which NYSE-listed companies are required to obtain shareholder approval...more
On September 26, 2018, the Securities and Exchange Commission approved amendments (the “Amendments”) to NASDAQ Rule 5635(d) (commonly referred to as the “20% Rule”). The purpose of the 20% Rule is to protect an issuer’s...more
Cedarview Opportunities Master Fund L.P. v. Spanish Broadcasting System Inc. C.A. 2017-0785-AGB (August 27, 2018) - How to interpret the provisions of preferred stock is often a difficult task. Any preference must be...more
QC Holdings Inc. v. Allconnect Inc., C.A. 2017-0715-JTL (August 27, 2018) - This decision on a undisputed factual record interpreted a contractual right to put stock by rejecting one side’s argument as “commercially...more
QC Holdings Inc. v. Allconnect Inc., C.A. No. 2017-0715-JTL (Del. Ch. Aug. 28, 2018) - This decision is necessary reading for drafters of redemption rights. It involves the interpretation of a redemption rights agreement...more
In re CBS Corporation, C.A. No. 2018-0342-AGB (Del. Ch. July 13, 2018) - It is well settled that members of the board of directors are entitled to essentially unfettered access to the corporation’s records to carry out...more
Venture capital firms and their director designees on portfolio company boards can find themselves stuck between their fiduciary duty to common shareholders and the terms of preferred investment documents. Before any other...more
On January 10, 2018, Vice Chancellor J. Travis Laster of the Delaware Court of Chancery granted a motion for judgment on the pleadings to plaintiffs, the CEO and another director of TradingScreen Inc., invalidating a written...more
The Delaware Court of Chancery recently issued two important decisions addressing the interpretation and effects of stockholders' agreements. In Schroeder v. Buhannic, the Court of Chancery refused to interpret a...more
R.L. Polk & Co. Inc., a private company, was allegedly more than 90% controlled by the Polk family. The Company was in the consumer marketing business with holdings such as Carfax, Inc. In March 2011, the Company initiated a...more
A recent decision of the Delaware Court of Chancery (the “Court”) places certain fiduciary constraints on a company’s ability to satisfy its obligations to its preferred equity holders. While investors often seek to acquire...more
In Magna Equities II, LLC et al., v. Writ Media Group Inc., et al., No. 653808/2016, 2017 BL 115243 (N.Y. Sup. Ct March 30, 2017), Justice Peter Sherwood dismissed for lack of jurisdiction and failure to state a claim all...more