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Court Of Chancery Explains Effect Of Stockholder Vote In Non-Controlling Stockholder Case

Posted In M&A
In re KKR Financial Holdings LLC Shareholder Litigation, C.A. 9210-CB (October 14, 2014) This important decision addresses two tricky questions of Delaware corporate law. First, it clarifies that the informed vote of a majority of the disinterested stockholders will invokeĀ the business judgment rule when there is no controlling stockholder pushing the transaction. Second, it makes it clear that stockholder approval may ratify director actions even when the stockholder vote is not required to implement that action. The decision carefully reviews prior cases in reaching these conclusions and for that reason alone is worth a reading. Share
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