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John Jenkins at DealLawyers.com took note yesterday of an interesting ruling by Vice Chancellor J. Travis Laster in
Stream TV Networks v. SeeCubic, C.A. No. 2020-0310-JTL (Dec. 8, 2020). On issue in the case was whether Section 271 of the Delaware General Corporation Law requires shareholder approval when an insolvent corporation transfers all or substantially all of its assets to its secured creditors. Vice Chancellor Laster ruled: Interpreting Section 271 to require a stockholder vote before an insolvent or failing corporation can transfer its assets to secured creditors would conflict with Section 272 of the DGCL, which authorizes a corporation to mortgage or pledge all of its assets without complying with Section 271.