Merger Mechanics

Statutes

Delaware GCL § 251
Merger or consolidation of domestic corporations and limited liability company

Delaware GCL § 252
Merger or consolidation of domestic and foreign corporations; service of process upon surviving or resulting corporation

Delaware GCL § 253
Short-Form Mergers

Delaware GCL § 254
Merger or consolidation of domestic corporation and joint-stock or other association

Delaware GCL § 255
Merger or consolidation of
domestic nonstock corporations

Delaware GCL § 256
Merger or consolidation of domestic and foreign nonstock corporations; service of process upon surviving or resulting corporation

Delaware GCL § 257
Merger or consolidation of domestic stock
and nonstock corporations

Delaware GCL § 258
Merger or consolidation of domestic and foreign stock
and nonstock corporations

Delaware GCL § 259
Status, rights, liabilities, of constituent and surviving or resulting corporations following merger or consolidation

Delaware GCL § 260
Powers of corporation surviving or resulting from merger or consolidation; issuance of stock, bonds or other indebtedness

Delaware GCL § 261
Effect of merger upon pending actions

Delaware GCL § 262
Appraisal Rights

Delaware GCL § 263
Merger or consolidation of domestic corporation

Delaware GCL § 264
Merger or consolidation of domestic corporation and limited liability company

Delaware GCL § 265
Conversion of other entities to a domestic corporation

Delaware GCL § 266
Conversion of a domestic corporation to other entities

Doctrine of Independent Legal Significance

Delaware courts rarely invoke the
de facto merger doctrine

Instead, give equal dignity to different DGCL provisions so that they have independent legal significance
Thus, won't recast a sale of assets to be a merger
or vice versa
Few exceptions have involved hindering creditors
Instead, Delaware courts apply DGCL provisions in a strict, formalistic way

Merger can thus be used as alternative means to an end

E g, to avoid terms of preferred stock
(preference stripping)
E g, to avoid dividend arrearages

Benchmark Capital v Vague (Del Ch 2002)

Venture capital-backed company needed additional capital
Used a merger to avoid terms of preferred stock that would have given VC firm a veto over proposed financing
Court denied VC firm's request for a preliminary injunction to block the merger and subsequent financing

Warner Communications v Chris-Craft (Del Ch 1989)

Denied class vote on merger to preferred holders
Even though effect of merger was to avoid their preferences

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