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Jane T (LLC)
Jane T (LLC), Attorney
Category: Business Law
Satisfied Customers: 8435
Experience:  Worked in corporation's law department; business formations, formalities, and other business matters
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Hi Jane, Jack Squelch is the CEO and 25% stockholder of

Customer Question

Hi Jane,

Jack Squelch is the CEO and 25% stockholder of GEE Inc. He receives an offer to buy the company from a LBO firm called Asset Strippers Inc. He knows that Asset Strippers is interested in selling off the real estate assets of GEE and want to make a quick buck that way. They offer him $35/share as against the prevailing market price of $25. He does not appoint independent consultants to evaluate the bid, and advises the Board of Directors that the offer is a good one and that the company should accept it. The Board acts on this advice and passes a resolution to sell the company to Asset Strippers Inc. Has any violation of the Securities Laws been committed?

Analyzed duties of directors.

Evaluated whether Squelch violated duty of loyalty.

Discussed special obligations of 10% shareholders.

Cited appropriate case law.

Determined that Squelch was liable.
Submitted: 7 years ago.
Category: Business Law
Expert:  Jane T (LLC) replied 7 years ago.



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