Chancery Deals A Blow To Supermajority Bylaw Provisions

Law360, New York (February 10, 2017, 10:38 AM EST) -- Lisa R. Stark

Taylor B. Bartholomew In Frechter v. Zier, C.A. No. 12038-VCG (Del. Ch. Jan. 24, 2017), the Delaware Court of Chancery held that a corporation's bylaw requiring a supermajority stockholder vote for the removal of directors was invalid. According to the court, the supermajority bylaw was inconsistent with Section 141(k) of the General Corporation Law of the State of Delaware (DGCL), which provides that, except with respect to corporations having a staggered board or cumulative voting, any director may be removed with or without cause by the holders of a majority of the outstanding voting power of the corporation....

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