How to take control of a Board through written consents

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Last month, the Delaware Court of Chancery issued an opinion in Kerbawy v. McDonnell that addressed how holders of a majority of a company’s shares should take control of a board of directors by executing written consents. The case involved interpretation of Section 228 of the Delaware General Corporation Law, which provides that, unless otherwise set forth in a corporation’s certificate…

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Dole CEO and GC Fraud Liability for Otherwise Proper Going-Private Deal

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Yesterday, the Delaware Court of Chancery found the controlling shareholder-CEO and General Counsel of Dole Food Co. Inc. liable to investors for $148 million for fraudulently driving down the company’s share price in anticipation of a going-private transaction.  What’s particularly noteworthy here is that the controlling shareholder appears to have structured the transaction with all of…

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What are the main features of public company M&A?

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A few years ago, I gave a training webinar on public company M&A with my close friend Roger W. Bivans, a Partner with Baker & McKenzie in Dallas. This offers a fairly comprehensive treatment of the subject. However, it hasn’t been updated to reflect any changes in the law since its original publication date so be careful…

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M&A Fiduciary Duties: Maximizing Shareholder Value

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You owe minority investors or other shareholders special fiduciary duties when you sell your company. As I discussed in a prior post, directors, officers and others who control companies (let’s call them “control persons”), owe certain baseline fiduciary duties to shareholders.  Under Delaware law, the benchmark for corporate governance in the United States, these duties apply…

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Fiduciary Duties: Minority Shareholder Rights

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Officers, directors, managers, controlling stockholders and other control persons of corporations and other entities frequently have responsibilities to minority owners set forth in their companies’ organizational documents (charters, bylaws, operating agreements, etc.).  For example, a control person may be required to give investors access to a company’s books and records. In addition, state law imposes…

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