Newsletters

Mergers

Disclosure and Shareholder Approval Requirements for Stock Options During Mergers

Initial Public Offerings and Lockup Agreements

A lockup agreement is a contract between an underwriter and a company going public in which the insiders of the company, including directors, officers, employees, and friends and family agree that they will not sell shares of the company they own until a set period of time after the company's shares are sold to the public. The objective of the lockup agreement is to provide a stable market for the securities for a reasonable time after the initial public offering.

Remedies for Dissenting Shareholders and the Deadlocked Corporation

Dissenting shareholders in a publicly-traded corporation may sell or otherwise dispose of their shares and seek as damages any lessening of value of the shares prior to the sale resulting from the matter causing the dissension. However, shareholders in a closely held corporation may not have a reasonable way to dispose of their shares and avoid dissension. Deadlocks among shareholders or directors of closely held corporations thus may result more often in litigation than such conflicts within publicly held corporations.

Pre-Incorporation Contracts of Promoters

Persons who enter into contracts on behalf of a corporation yet to be formed are considered "promoters." Such pre-incorporation contracts raise issues regarding the rights and liabilities of the promoter and the new corporation.

Antitrust and Trade Law Venue

Treble damages under Clayton Act