Court Of Chancery Again Interprets The Step Transaction Doctrine
Coughlan v. NXPB, C.A. 5110-VCG (November 4, 2011)
It is sometimes important to decide if a series of transactions are to be coupled together to be treated as one. The so-called step transaction doctrine does that when applied. Here the Court used the step transaction to interpret an agreement that gave the selling stockholders the right to a bump up in the merger consideration and certain protections if company assets were sold before all the additional consideration was paid. This somewhat lenient application of the doctrine may signal its greater acceptance by the Court.
