Posted by Asher Bearman on December 03, 2012

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Asher Bearman
asher.bearman@dlapiper.com

Earlier this year, I wrote about an opinion from the Delaware Court of Chancery that, if affirmed, could have broad practical implications for LLC managers and the fiduciary duties owed to their members.  We have been monitoring this case and, on November 7, the Delaware Supreme Court issued its decision.  As it turns out, whether fiduciary duties are owed by default in a Delaware LLC remains an open question.  The Delaware Supreme Court affirmed the earlier Chancery Court's opinion exclusively on contractual grounds, leaving open-ended the question as to default fiduciary duties by rejecting the Chancery Court's decision to incorporate fiduciary duties into the Delaware LLC Act.  Please continue reading below for the text of DLA Piper's follow-up Client Alert posted by John Reed and Jennifer Lloyd.

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Posted by Trent Dykes on October 24, 2012

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Kevin Criddle
kevin.criddle@dlapiper.com 

 
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Anthony Kappus
anthony.kappus@dlapiper.com

One of the key considerations in structuring merger and acquisition (M&A) transactions is determining which contracts of the target company, if any, will remain in effect for the acquiror following closing.  This post will briefly outline: (1) the general rules of contract assignment; (2) the effect of anti-assignment clauses and other exceptions to the general rule of assignability; and (3) the effect of four common M&A structures on contract assignment.

General Rule: Contracts are Freely Assignable

The general rule is that contracts are freely assignable unless the contract itself, a statute, or public policy dictates otherwise.  This is true in Washington State, where courts have found that contractual rights are generally transferable unless the contract expressly prohibits assignment in “very specific” and “unmistakable terms.”

Exceptions to the General Assignability Rule

The exceptions to the general rule of free assignability fall into two broad categories: (1) contractual prohibitions on free assignability (“anti-assignment clauses”) and (2) case law prohibitions on free assignability of certain types of contracts that arise out of public policy concerns.

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Posted by Asher Bearman on June 07, 2012

Carbins_Amy.jpgCONTRIBUTED BY
Amy Carbins
amy.carbins@dlapiper.com

In the early growth stages, new companies often look for short-term leases for relatively small suites to enable the company to expand or scale back on the space and rent obligations depending on the success of the business. When the time comes for a new company to branch out into its first office space, the need to finalize the lease quickly can become very pressing. However, the legal issues and financial risks associated with short-term leases for small suites are, for the most part, very similar to those associated with long-term leases for large spaces. Most landlords will present the same form of lease to a tenant for a two-year, 3,000 square foot lease as they present to a tenant for a five- or ten-year, 50,000 square foot lease. In an ideal setting, a company would be able to engage counsel to negotiate for customary tenant protections throughout the lease. However, when time and resources available to devote to lease negotiations are scarce, tenants must prioritize issues in order to get to lease signing within the company's time and cost budgets. Although circumstances vary from lease to lease, there are some key considerations that are likely to be present in any commercial office lease.

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