News & Analysis as of

Preferred Shares Shareholders

Farrell Fritz, P.C.

Must a Professional Corporation Redeem the Shares of its Retired Shareholders?

Farrell Fritz, P.C. on

I previously wrote that one of the most difficult periods in the lifecycle of a closely held business is the period following the death of an owner, due to the tension between the remaining owners wishing to continue the...more

Carlton Fields

Whither Objector Blackmail

Carlton Fields on

The Seventh Circuit confronts “objector blackmail” and limits the extraction of “rents from the litigation process simply by showing up and objecting to consummation of the settlement.”...more

Allen Matkins

What Makes Common Stock, Common?

Allen Matkins on

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

Skadden, Arps, Slate, Meagher & Flom LLP

Skadden's 2020 Insights

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

Skadden, Arps, Slate, Meagher & Flom LLP

Valuation Challenges for Fintechs Highlight Legal Considerations in ‘Down Rounds’

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

Barnea Jaffa Lande & Co.

Seven Investment Terms Every Entrepreneur Should Know

Barnea Jaffa Lande & Co. on

Being an entrepreneur involves wearing many hats. In addition to thinking about product and design, you must also be able to speak the language of investors.   Below are some important terms every entrepreneur should know...more

Morris James LLP

Chancery Enforces Preferred Stock Consent Rights, and Reasons that Designee of a Corporate Stockholder Is an “Affiliate” of that...

Morris James LLP on

PWP Xerion Holdings III LLC v. Red Leaf Resources Inc., C.A. No. 2017-0235-JTL (Del. Ch. Oct. 23, 2019). Preferred stockholders frequently obtain the right to veto specific types of transactions....more

Mayer Brown Free Writings + Perspectives

Social Costs of Dividends and Repurchases

In a recent paper, referenced above, author JB Heaton analyzes the extent to which the ability of corporations to return capital to their shareholders through dividends and repurchases results in substantial social costs. As...more

Morris James LLP

Court Of Chancery Interprets Preferred Stock Rights

Morris James LLP on

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

Morris James LLP

Court Of Chancery Interprets Contract Rights Under Commercially Rational Test

Morris James LLP on

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

Morris James LLP

Court of Chancery Enforces Redemption Rights and Addresses the Potential Effect of a Merger on Previously-Exercised Put Rights

Morris James LLP on

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

Foley & Lardner LLP

Common Misconceptions Regarding Preferred Stock Create Risk of Costly Mistakes

Foley & Lardner LLP on

Preferred stock is commonly used for venture capital and private equity investments. It gives the investor the ability to convert to common stock if the deal succeeds, and also includes protection of the liquidation...more

Foley & Lardner LLP

Venture Capital Firms and Their Portfolio Company Directors Face Risk of Liability for Conflicts of Interest

Foley & Lardner LLP on

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

Polsinelli

Further Clarification from Delaware Supreme Court on Deal Price in Statutory Appraisal Actions

Polsinelli on

The Delaware Supreme Court offered further guidance this week on the weight to be accorded a negotiated deal price in the context of shareholder appraisal litigation, which of course is important to businesses and counsel...more

Orrick, Herrington & Sutcliffe LLP

Public Company Corporate Governance Features in the Technology Sector: 2017

Orrick recently released a groundbreaking new study examining the corporate governance structures of every U.S. incorporated company in the Dow Jones Technology Sector Index. Led by partner Ed Batts, the study encompasses a...more

Cole Schotz

Delaware Court Of Chancery Identifies Fiduciary Duty Constraints On Preferred Equity

Cole Schotz on

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

Hogan Lovells

Why Luxembourg remains a jurisdiction of choice for private equity

Hogan Lovells on

1. Framework for an exit from an SARL - Prior to 23 August 2016, any transfer of shares to non-shareholders of an SARL was subject to the prior approval of the shareholders holding not less than 75% of the SARL's share...more

Stinson - Corporate & Securities Law Blog

ISS Launches 2017 ISS Benchmark Policy Comment Period

ISS announced the launch of its 2017 benchmark voting policy consultation period. The open comment period, which will solicit views from governance stakeholders globally on certain proposed voting policies for 2017, will run...more

Adler Pollock & Sheehan P.C.

Glossary of Important Securities Regulation Terms and Definitions

This Glossary is designed to provide law students taking Securities Regulation with a tool that will assist them in learning the basic language of securities law and achieve a working knowledge of the fundamental principles...more

Adler Pollock & Sheehan P.C.

Mergers & Acquisitions Glossary

This Glossary contains many of the important terms and definitions used in the M&A world. The Glossary is not exhaustive, however. Like most areas of the law, M&A is a highly complex subject that involves several legal and...more

K&L Gates LLP

Amendment to Taiwan’s Company Act Establishes 'Closely-Held Company Limited by Shares' to Provide Flexibility on Fund-Raising for...

K&L Gates LLP on

On July 1, 2015, an amendment (Amendment) to the Company Act of Taiwan took effect to establish a new category of company under the new Chapter 13, called “closely-held company limited by shares”, hereinafter, a 'close...more

Katten Muchin Rosenman LLP

Seventh Circuit Holds Under Indiana Law, Company Was Allowed to Vote Its Own Shares

The United States Court of Appeals for the Seventh Circuit recently affirmed a district court decision holding that under Indiana law, an Indiana corporation could vote its own outstanding preferred shares. In 1999, Emmis...more

Akin Gump Strauss Hauer & Feld LLP

Avoiding Common Pitfalls in Preferred Stock Transactions

Preferred stock issuances by Delaware corporations are often effected through a board’s “blank check” power contained in a company’s certificate of incorporation and permitted by Section 151(a) of the Delaware General...more

PilieroMazza PLLC

OHA Sheds Some Light on What Constitutes a “Class” of Stock

PilieroMazza PLLC on

In my recent article about the impact of separate stock classes on veteran-owned firms, I discussed how having more than one class of voting stock can complicate an ownership analysis under both the Department of Veterans...more

Smith Anderson

North Carolina Business Court Limits Unfair and Deceptive Trade Practice Claims Concerning Internal Corporate Matters

Smith Anderson on

On January 28, 2014, the North Carolina Business Court dismissed an unfair and deceptive trade practice claim alleging that corporate directors structured the sale of a corporation in a manner that shortchanged its common...more

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