Preserving the stockholder franchise: issuance of Series B Preferred Stock with separate series vote on all matters subject to stockholder approval breached directors’ duty of loyalty and held invalid under “enhanced scrutiny” standard *

USA - October 31 2011
In Johnston v. Pedersen (Del. Ch. Sept 23, 2011), Vice Chancellor Laster of the Delaware Court of Chancery held that the issuance of Series B Preferred Stock conferring on the holders of Series B Preferred Stock a separate series vote on any matter submitted to the stockholders for approval, including the election of directors, was invalid.

Co-authors: Noel Pacheco , Jeannie Shin .

Delaware Supreme Court rules onwhether a “series of transactions” should be aggregated inanalyzing the saleof “substantially all” assets question *

USA - October 31 2011
The Delaware Supreme Court recently ruled that a company’s proposed splitoff of assets should not be aggregated with three prior spinoff and splitoff transactions, where the proposed splitoff was not “sufficiently connected” to the prior transactions, for purposes of determining whether the company has disposed of “substantially all” of its assets.

Co-authors: Stephanie Tang , Jeannie Shin .

California appellate court holds that boards of directors may enter into exclusive transaction agreements – no “fiduciary out” required *

USA - April 8 2011
On March 30, 2011, the California Court of Appeal issued the first California state court decision affirming that the board of directors of a California corporation may lawfully enter into an exclusive agreement involving a recapitalization, merger or other extraordinary transaction without any requirement for a "fiduciary out".

Co-authors: Daniel J. Tyukody , Richard Vernon Smith .

National security review of mergers and acquisitions in China by foreign investors *

China - February 16 2011
On February 3, 2011, the State Council of the People's Republic of China (PRC) issued a new regulation to implement the requirement for national security reviews of mergers and acquisitions involving domestic enterprises by foreign investors.

Co-authors: Elizabeth Cole , Jeannie Shin , Richard Vernon Smith .