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Dutch auction meaning

What does Dutch auction mean?
In practice, a Dutch auction is a contractual deadlock or exit mechanism in shareholders’ agreements and joint venture arrangements. Each party submits a sealed bid stating the lowest price per share (or enterprise value) at which it is willing to sell its shares to the other. The party that bids the lower price is compelled to sell, and the other party must buy at that price. It is used after escalation steps fail to resolve a deadlock and is less common than russian roulette or a Mexican/Texas shoot-out. The term is descriptive transactional shorthand rather than a concept defined by statute or case law. Key features and drafting points include: sealed bids submitted to an independent recipient; clear pricing basis and timetable; tie‑break provisions; funding certainty and completion mechanics; confidentiality; waiver of pre-emption and other transfer restrictions; regulatory/competition approvals; and consequences of default. It can mitigate valuation disputes but may disadvantage a party with weaker information or liquidity. Usage and enforceability are broadly consistent across England & Wales, Scotland, Northern Ireland and Ireland, subject to general contract and company law, company constitutional restrictions, unfair prejudice considerations, insolvency constraints and any applicable financial assistance or regulatory regimes.
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NEWS
UK and EU environmental law weekly: courts, legislation and policy on planning, climate, permits, waste, water and ESG (14 March 2024)

This issue includes Air emissions and climate change Brexit Contamination and pollution Energy efficiency and buildings Energy for environmental lawyers Environmental assessment Environmental disputes and proceedings Environmental information Environmental issues in transactions Environmental permits and consents Environmental taxes, reliefs and incentives ESG and sustainability Hazardous substances and chemicals Health and safety Sources of environmental law (UK, EU, international) Waste Waste producer responsibility regimes Water, flooding and drainage Wildlife, biodiversity and habitat conservation Daily and weekly news alerts New and updated content Trackers Useful information Air emissions and climate change Court finds there is no presumption favouring repurposing and re-using buildings in the NPPF (Marks and Spencer plc v Secretary of State for Levelling Up, Housing and Communities). In that case, the High Court quashed the Secretary of State’s decision blocking M&S’s Oxford Street redevelopment. Written by Martha Grekos, barrister at MGLC...

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PRACTICE NOTES
Deadlock in UK corporate joint ventures: triggers, reserved matters, and resolution mechanisms (escalation, ADR/expert determination, buy-sell options, share transfers, and termination via liquidation or winding up)

A deadlock arises when parties to an agreement face an irreconcilable dispute and cannot reach consensus. The expression is commonly associated with corporate joint ventures (JVs), especially 50:50 JVs where neither side holds a controlling interest and, as a result, unanimous consent is required for all decisions. Deadlock may equally occur in non-50:50 JVs, for example where specific matters demand unanimity or where more than two JV participants vote and no majority is achieved. Certain conflicts can trigger a deadlock that prevents the joint venture company (JVC) from operating effectively. It is sensible to address at the outset how a deadlock might be settled. Consequently, joint venture agreements (JVAs) usually include deadlock resolution mechanisms (often in stepped stages) that must be followed to resolve the impasse. Defining deadlock procedures within the JVA will save time and expense if a deadlock emerges and will help the parties to maintain the JV's continuity. On occasion, the very circumstances that produce a deadlock can also prompt the aggrieved party to seek relief under...

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