Articles Posted in Delaware Court of Chancery

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This action involved a challenge to the decision by a purchaser to terminate a share purchase agreement and related consulting services agreement based on the purchaser's contention that certain conditions precedent to closing those agreements had not been met by the seller. Purchaser brought an action for declaratory judgment and injunctive relief, seeking a determination that it properly terminated the share purchase and consulting services agreements and was entitled to the return of its down payment on the purchase price from escrow. The court found that the agreements between the parties unambiguously provided that the Development Fees were contingent on the commencement of actual development of the projects and that the purchaser was under no obligation to develop the projects. Therefore, the court granted purchaser's motion for partial summary judgment on that issue and held that seller was not entitled to any Development Fees as a result of purchaser's decision to terminate the transaction. View "Invenergy Solar Dev. LLC v. Gonergy Caribbean Sarl, et al." on Justia Law

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This case arose out of a sale-leaseback transaction that occurred in 2001. On July 10, 2011, the seller-lessees' parent company announced plans for a proposed transaction whereby it would seek a new credit facility and undergo an internal reorganization. As part of a subsequent reorganization, substantially all of its profitable power generating facilities would be transferred from existing subsidiaries to new "bankruptcy remote" subsidiaries, except for two financially weakened power plants. On July, 22, 2011, plaintiffs brought this action seeking to temporarily restrain the closing of the proposed transaction on the grounds that it violated the successor obligor provisions of the guaranties and would constitute a fraudulent transfer. The court found it more appropriate to analyze plaintiffs' motion for a temporary restraining order under the heightened standard for a preliminary injunction. Having considered the record, the court held that plaintiffs have failed to show either a probability of success on the merits of their breach of contract and fraudulent transfer claims or the existence of imminent irreparable harm if the transaction was not enjoined. Therefore, the court denied plaintiffs' application for injunctive relief. View "Roseton Ol, LLC, et al. v. Dynegy Holdings Inc." on Justia Law