All of negotiations of asset sale to eckerd drug

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Reference no: EM13901516

The majority shareholder and president of Dunaway Drug Stores, Inc., William B. Dunaway, was structuring and executing the sale of virtually all of the corporation’s assets to Eckerd Drug Co. While doing this, he negotiated a side noncompeting agreement with Eckered, giving Dunaway $300,000 plus a company car in exchange for a covenant not to compete for three years. He simultaneously amended two corporate leases with Eckerd, thereby decreasing the value of the corporation’s leasehold estates. The board of directors approved the asset sale. Minority shareholders brought a derivative action against William Dunaway, claiming breach of his fiduciary duty in negotiating the undisclosed noncompeting agreement, which did not require him to perform any service for buyer Eckerd Drug? Did William Dunaway make sufficient disclosure about all of the negotiations of the asset sale to Eckerd Drug? Did William Dunway violate any fiduciary Duty to the corporation? Decide. Substantive response.

Reference no: EM13901516

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