Business Law Newsletters

Breakpoints in Mutual Fund Charges

Mutual funds may offer "breakpoints" in their front-end sales load. Thus, a fund that charges a fee of five percent for investments up to $25,000 may charge only four percent for investments from $25,000 to $50,000 and three percent for investments over $50,000. The fund has breakpoints at $25,000 and $50,000.

Copyrights, Patents, and Trademarks Defined

Copyrights, patents, and trademarks can be among the most valuable assets of a business.

Failing Company Defense

A merger or acquisition that has the potential to lessen competition significantly may violate Section 7 of the Clayton Act, 15 U.S.C.S. § 18. However, a "failing company" defense has emerged from case law and legislative history of an amendment to Section 7 that allows an acquisition or merger to proceed if the company being acquired is subject to imminent bankruptcy or liquidation, and the acquiring company is the only prospective purchaser of the failing company.

Federal Regulation of Corporate Takeover Bids or Tender Offers

Traditionally, proxies of shareholders of corporate takeover targets were sought for votes in favor of the takeover. Rules issued by the Securities and Exchange Commission to regulate the content of proxies so that shareholders were able to make an informed decision provided some protection for shareholders.

Ultra Vires Acts

In most states, the duty of obedience is recognized as one of the three fiduciary duties a director owes to the corporation. One component of the duty of obedience is that a director is prohibited from committing an ultra vires act. Ultra vires, translated from the Latin, means "beyond powers." An ultra vires act is beyond the scope of the powers bestowed on the corporation (and the director) by the corporate charter or bylaws. Thus, a director commits an ultra vires act when he acts without or beyond the authority vested in him by the corporation.