In In re School Specialty, Inc., the United States Bankruptcy Court for the District of Delaware denied a motion brought by the Official Committee of Unsecured Creditors which sought to disallow a $23.7 million "early payment fee" in a prepetition credit agreement.

Recent proposed amendments to the Delaware General Corporation Law contain an important addition to Section 251, which governs mergers between Delaware corporations, that would effectively allow the parties to dispense with the need for a back-end stockholder vote on a merger in certain cases where the buyer has acquired a sufficient number of shares in a front-end tender offer.

A pair of recent decisions by the Delaware Court of Chancery scrutinize the use of ‘‘don’t ask, don’t waive’’ provisions in standstill agreements, suggesting that boards be fully informed of the impact of using such a tool in mergers.

Among the many significant proposed changes to Delaware's General Corporation Law that were submitted to the corporation law section of the Delaware State Bar Association this March for approval, the sections dealing with ratification of defective corporate acts stand out as particularly noteworthy.

Legislation proposing to amend the General Corporation Law of the State of Delaware (the “DGCL”) and related sections of title 8 of the Delaware Code has been submitted to the Corporation Law Section of the Delaware State Bar Association for approval. If the amendments become effective, they would result in several significant changes to the DGCL.

The State of Delaware Department of Natural Resources and Environmental Control is considering several legislative amendments that are of potential significance for future site development in the State, as well as for facilities that fall under DNREC's Hazardous Substance Cleanup, Tanks and Oil Pollution programs.

In a bench ruling in Dent v. Ramtron International Corporation, Vice Chancellor Parsons of the Court of Chancery declined to preliminarily enjoin a stockholder vote on a proposed merger between Cypress Semiconductor Corporation and Ramtron International Corporation.

In In re Novell, Inc. Shareholder Litigation, Vice Chancellor Noble of the Court of Chancery declined to dismiss breach of fiduciary duty claims against the board of directors of Novell, Inc., concluding that the plaintiffs’ allegations that the Board had treated a serious bidder in a materially different manner than Novell’s eventual acquiror supported a reasonable inference that the Board had acted in bad faith.

In Metropolitan Life Insurance Company v. Tremont Group Holdings, Inc., Vice Chancellor Parsons of the Court of Chancery further clarified Delaware law with respect to the distinction between direct and derivative claims in litigation involving Delaware limited partnerships.

In South v. Baker, Vice Chancellor Laster of the Court of Chancery dismissed a derivative claim for breach of fiduciary duty based on the Caremark theory of liability, finding that because the plaintiffs failed adequately to represent the company, dismissal of their complaint would be with prejudice to the named plaintiffs only and would not preclude the litigation efforts of other stockholders.