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Keep a look out for Insights: Delaware Alert to stay up to date on the most important corporate opinions coming out of Delaware!

In re Match Group is a significant decision for practitioners who represent Delaware companies because: (i) it clarifies the presumptive standard of review applicable to any transaction in which a controlling stockholder stands on both sides; and (ii) it highlights the importance of special committee independence. This opinion will inform the advice attorneys give their clients on a variety of issues, from the negotiation and execution of transactions involving controlling stockholders, to the selection of Board and special committee members. The case is also likely to affect the trajectory of existing and future disputes arising out of challenges to controlled transactions. Please check out a recent article that I wrote summarizing this important Delaware Supreme Court opinion.

The Delaware Supreme Court Upholds Two-Condition MFW Framework for Securing Business Judgment Review of Controller Transactions In an en banc, unanimous decision in In re Match Group, Inc. Derivative Litigation, the Delaware Supreme Court rejected the proposal for a less demanding route to business judgment review concerning transactions involving self-interested controlling stockholders that do not amount to complete "squeeze-out" mergers. Instead, Chief Justice Collins J. Seitz, Jr., writing the opinion, upheld that in all instances where the controller has interests on both sides and gains a non-ratable benefit (even in non-squeeze-outs), the presumptive standard of review is entire fairness. Defendants are required to show compliance with both prongs of the framework outlined in Kahn v. M & F Worldwide Corp. ("MFW") to attain business judgment review for the transaction. Additionally, the ruling underscores that within the MFW context, to mimic arm's-length negotiations, every member of the committee, not just a majority, must be independent from the controller. Thus, Match Group v. In re MFW reaffirms that, under Delaware law, MFW remains the exclusive route to trigger business judgment review in transactions involving self-interested controllers and clarifies the necessity of ensuring the independence of each member of the special committee to rely on MFW's safeguards. https://lnkd.in/e5umk7BF

Supreme Court of Delaware issues a key decision of interest to transactional counsel advising on corporate transactions involving controlling stockholders. The key takeaways, and link to the opinion, are in our blog post below.

Once again I had the pleasure of sharing my views with Bill Meagher at The Deal about how the new SEC rules will influence deals, but are unlikely to kill the SPAC market. As I expressed in the article (excerpts only): ..."These new rules include disclosure requirements for all material basis of the projections and for all material assumptions underlying those projections," said Perrie Weiner, who chairs the North America Securities Litigation Group for Baker & McKenzie LLP. "In other words, the SEC has now severely diminished the SPAC's value as being a superior vehicle to the more traditional IPOs in this respect." "The GOP see these rules as closing doors as opposed to providing more opportunities," Weiner said. For the full article (subscription based), log into: https://www.thedeal.com/.

Farrell Fritz, P.C.'s Alon Kapen writes: There are generally two ways you can control a corporation. One is by owning a majority of the stock, in which case you control the board of directors. The other is to secure control contractually, through agreements and charter provisions that provide protections such as board representation or vetos over major transactions. But what happens when those contractual and charter provisions interfere with the statutory authority of a board of directors to manage a company’s affairs as mandated by state corporate law? #boardofdirectors #delaware #corporategovernance #stockholdersagreements

The computation of a shareholder’s gain or loss on a complete liquidation is ordinarily a straightforward affair.

Minority shareholders may have very little say in the day-to-day operation of the business. The New Jersey Oppressed Minority Shareholders Statute (N.J.S.A. 14A:14-7) (the “Act”) protects minority shareholders from unlawful and oppressive acts by the majority or controlling shareholders. The protections afforded by the Act apply to closely held corporations with 25 or fewer shareholders. Read More: https://lnkd.in/eNMYEyyV #spglaw #SchillerPittengerGalvin #attorneys #law #newjersey #oppressed #minority #shareholder #statute

Shareholder Agreements and Unfair Prejudice: Untangling Complex Relationships Greg Vincent, Head of Corporate & Commercial at Morr & Co, looks at the value of contractual clarity and the importance of owner managers acting with transparency and fairness when applying pre-agreed terms on a shareholder exit. In doing so, Greg also outlines the recent case of Wells v Hornshaw [2024] EWHC 330 (Ch). https://lnkd.in/eMntPUPh #CorporateInsights #ShareholderAgreements #Predudice #Shareholders #BusinessAdvice

Minority shareholders may have very little say in the day-to-day operation of the business. The New Jersey Oppressed Minority Shareholders Statute (N.J.S.A. 14A:14-7) (the “Act”) protects minority shareholders from unlawful and oppressive acts by the majority or controlling shareholders. The protections afforded by the Act apply to closely held corporations with 25 or fewer shareholders. Read More: https://lnkd.in/ebFxPBau #spglaw #SchillerPittengerGalvin #attorneys #law #newjersey #oppressed #minority #shareholder #statute