Court Of Chancery Explains Relationship Of Pill Cases To Proxy Contests
Posted In M&A
Third Point LLC V. Ruprecht, C.A. 9469-VCP (May 2, 2014)
A poison pill may affect a proxy contest by limiting one side's ability to acquire stock to vote in its favor. But, as this important decision holds, the adoption of a pill is subject to the Unocal standard and not the more exacting Blasius "compelling justification" test. The opinion is also important for its exacting analysis of the justifications under Unocal to not waive a pill and to use a 2-level pill in the face of an imminent proxy contest.