Asked by
Nicholas Fetterman
on Nov 01, 2024Verified
The "Unocal Rule" says that under the business judgment rule,board members have the right and the duty to work to block a takeover bid when that bid will damage the corporation and legitimate corporate plans.
Unocal Rule
A legal standard from a Delaware Supreme Court case that gives boards of directors a framework for resisting takeover bids.
Business Judgment Rule
A legal principle that shields corporate directors and officers from liability for decisions made in good faith but that ultimately resulted in loss or damage.
Takeover Bid
An offer made to acquire a controlling interest in a company, often against the wishes of its management.
- Familiarize oneself with the essential elements of the business judgment rule and its protective provisions for corporate management.
Verified Answer
TH
Learning Objectives
- Familiarize oneself with the essential elements of the business judgment rule and its protective provisions for corporate management.