Bidders and Targets: Mergers and Acquisitions in the U. S. Book

	Acknowledgments	xi
1	Introduction	1
Part I	The Framework
2	If Only Directors Were Perfect	9
2.1	The Prisoner's Dilemma	11
2.2	Judging Business Judgment	15
2.3	The Standards for Defense	18
2.4	The Stricter Standard	22
3	Shareholders Are Not Perfect Either	24
3.1	Questioning Takeover Mania	24
3.2	The Short-run Outlook of Institutional Shareholders	27
3.3	The Impotence of Bidders' Shareholders	29
3.4	Possible Solutions	30
4	The Chief Executive Office	33
5	The Importance of State Corporation Law	39
5.1	The Scope of State Law	40
5.2	The Preeminence of Delaware	42
5.3	The Fear of Federal Preemption	45
5.4	The Courts' Preoccupation with Procedure and Morality	46
5.5	Disclosure	48
5.6	Special Committees	49
5.7	Expert Advice	50
5.8	The Limits of the Procedural Approach	51
6	How State Antitakeover Laws Change the Balance	53
6.1	Laws that Restrict Mergers	55
6.2	The Delaware Version of the New York Statute	58
6.3	Laws that Restrict Voting	59
6.4	Heightened Disclosure Statutes	60
6.5	Fair Price Laws	61
6.6	Special Appraisal Rights Laws (Put Statutes)	61
6.7	A New Wave of State Antitakeover Statutes	62
6.8	The Next Response from the Courts	64
6.9	The Future in Delaware	67
7	Defending Friendly Acquisitions from Competition	69
7.1	Lockups: Revlon and Other Cases	70
7.2	Fiduciary Outs	75
8	Poison Pills and Other Defenses Against Takeovers	76
8.1	Discrimination and Flip-in Pills	79
8.2	Pills and State Laws Compared	83
8.3	Other Defensive Devices	84
9	The Role of Federal Law	87
9.1	The Securities Laws	87
9.2	The One-Share-One-Vote Controversy	89
9.3	Antitrust Laws	91
9.4	How Acquisitions become Public	93
9.5	Foreign Bidders	96
10	Conflicts of Interest: Auctions, Squeeze-outs, Leveraged Buyouts and Insider Trading	99
10.1	When are Auctions Required?	99
10.2	Auction Procedure	102
10.3	The Level Playing Field	104
10.4	Squeeze-out Mergers	105
10.5	Leveraged Buyouts and Recapitalizations	109
10.6	Insider Trading	112
Part II	Advice for Bidders and Targets
11	A Successful Bidder May Still Be a Loser	119
11.1	The Winner's Curse	120
12	Friendly Deals: What Good is a Contract?	124
12.1	The Structure of an Agreed Transaction	125
12.2	Why It is Hard to Obtain a Legally Binding Agreement	130
13	Should I Make a Hostile Bid?	134
13.1	The Competition: Why Were They Not Bidding Before?	135
13.2	Should I Talk to the Target First?	137
13.3	Public Relations	138
13.4	Why Most Successful Bids Wind up 'Friendly'	139
13.5	Competing Friendly Bids	141
13.6	Family Holdings	141
13.7	Margin Regulations	142
13.8	Proxy Fights	143
13.9	Street Sweeps	146
14	How Should We Defend Against a Hostile Bid?	148
14.1	Should We Appoint a Special Committee?	150
14.2	Staying Independent	151
14.3	Combining with Another Company	156
14.4	Selling the Company to a Favored Buyer	157
14.5	Aiming for the Highest Price	160
15	Traps and Opportunities for Bidders	161
15.1	Regulated Industries	162
15.2	Dealing with the Environment	165
15.3	Employee Benefits	168
15.4	Special Opportunities and Risks for Foreign Bidders	172
16	Practical Thoughts on Leveraged Buyouts and Recapitalizations	177
16.1	Leveraged Buyouts and their Strategic Problems	177
16.2	How Recapitalizations Attempt to Solve Some of the Problems of LBOs	178
16.3	Private Acquisitions and Auctions	182
Part III	Case Study: the Time--Warner Agreements
	Introduction	187
17	Commentary on the Original Time--Warner Merger Agreement	189
	Share Exchange Agreement	262
18	Commentary on the Revised Time--Warner Agreement	279
	Appendix	359
A.1	General Antifraud Provisions in the Federal Securities Laws	364
A.1.1	Securities Exchange Act of 1934 [section]10	364
A.1.2	Securities and Exchange Commission Rule 10b-5	365
A.2	Federal Tender Offer Statute and Regulations	366
A.2.1	Securities Exchange Act of 1934 [section]13(d)	366
A.2.2	Securities Exchange Act of 1934 [section]14	368
A.2.3	Securities and Exchange Commission Regulations 13D-G	372
A.2.4	Securities and Exchange Commission Regulation 14D	380
A.2.5	Securities and Exchange Commission Regulation 14E	400
A.3	Securities and Exchange Commission's One-Share-One-Vote Rule (Rule 19c-4)	404
A.4	Organization of Corporations under Delaware Law: Delaware Corporation Law [section]141	407
A.5	Delaware Merger and Antitakeover Statutes	411
A.5.1	Delaware Merger Statute: Delaware Corporation Law [section]251	411
A.5.2	Delaware Antitakeover Law (Restricting Mergers): Delaware Corporation Law [section]203	415
A.6	Appraisal Rights under Delaware Law: Delaware Corporation Law [section]262	421
A.7	New York Statute on Duty of Directors: New York Business Corporation Law [section]717	427
A.8	New York Statute Restricting Mergers: New York Business Corporation Law [section]912	429
A.9	New Jersey Statute on Duty of Directors: New Jersey Business Corporation Act [section]14A:6-1	439
A.10	New Jersey Statute Permitting Poison Pills: New Jersey Business Corporation Act [section]14A:7-7	440
A.11	List of State Antitakeover Statutes	441
A.12	Delaware Supreme Court Opinion in Paramount Communications Inc. v. Time Inc. (February 26, 1990)	445
	Table of Cases	467
	Bibliography	472
	Glossary	478
	Subject Index	507
	Name Index	520