Elimination Of Exception’s Exception For Listed Companies Is In The Offing
While many were thinking of love on Valentine’s Day, Assembly member Bob Wieckowski’s thoughts were turned to dissenters’ rights; for on that day he introduced AB 1680. This bill would eliminate an exception to an exception from the definition of “dissenting shares” in Corporations Code Section 1300(b). Because dissenters’ rights are intended to allow a shareholder the opportunity to obtain Read more...
Tomorrow Is The Bill Introduction Deadline
Under Joint Rules 61(b)(4) and 54(a), tomorrow is the last day for the introduction of bills in the California legislature. This means that in the next several months the legislature will be considering thousands of bills. In theory, the legislature should proceed in accordance with a schedule fixed by the state constitution, statutes and their own rules. However, the legislature Read more...
Seeing Red And More Than 50% Ownership May Mean A 90% Vote
California broadly authorizes a corporation to sell, lease, convey, exchange, transfer or otherwise dispose of all or substantially all of its assets when the principal terms have been approved by the board. If the sale is not in the usual and regular course of business, the principal terms must also be approved by the outstanding shares. Cal. Corp. Code § 1001(a). Read more...
Nevada Business Entity Law Changes Are Now In Effect
Nevada’s legislature meets only in odd number years and then for only 120 calendar days (2,880 hours). Nev. Const. Art. 4, § 2(2). This year, the legislature enacted SB 405, which makes numerous changes, large and small, to the Nevada’s business entity laws. These changes took effect on October 1. NRS 218.530. Among other things, SB 405 reduces to two Read more...
Nevada Supreme Court Pragmatically Rules On Delivery Of Dissenters’ Rights Notices
Last week, the Nevada Supreme Court answered the question of whether notice of dissenters’ rights must be delivered to both stockholders of record and beneficial owners. NRS 92A.410(2) provides that when a merger is effected without stockholder approval under NRS 92A.180, the Nevada corporation “shall notify in writing all stockholders entitled to assert dissenters’ rights that the action was taken Read more...
“Fair Is Foul, And Foul Is Fair”, But Are “Fair Value” And “Fair Market Value” Synonymous?
Last Friday, I wrote in this post about a recent Nevada Supreme Court decision that provides a modicum of guidance on how “fair value” is to be determined for purposes of Nevada’s dissenters’ rights law. California’s dissenters’ rights law doesn’t refer to “fair value”. Rather, California uses the term “fair market value”. According to Professor Harold Marsh, Jr., the use Read more...
Court of Appeal Upholds Contractual Limitations Period In Acquisition Agreement
Yesterday, the Fourth District Court of Appeal issued an opinion addressing two issues that should be of interest to the M&A community. Zalkind v. Ceradyne, Inc. involved a dispute concerning an asset purchase agreement. The Zalkinds (Stanley, Elizabeth and Quest Technology, LP, a limited partnership owned by them) agreed to sell all of Quest’s assets to Ceradyne, Inc. for cash and unregistered Read more...
California’s 50/90 Rule – When Being In Control May Mean That You’re Not
Many out-of-state practitioners are surprised to learn that California has special statutory provisions governing a merger when a constituent corporation (Section 161) or its parent (Section 175) owns, directly or indirectly, more than 50% of the voting power (Section 194.5) of the other constituent corporation prior to the merger. This is the so-called “50/90 Rule”. It can be found in the last sentence of Section 1101. Under Read more...
