Opinion ID: 2180498
Heading Depth: 1
Heading Rank: 4

Heading: The Parties' Conduct in the Interim of the Court of Chancery Action

Text: By the time the Court of Chancery action was filed, AeroGlobal had provided Cirrus with $12 million of the $15 million bridge financing. Aeroglobal decided to defer the remaining $3 million bridge loan payment until after the uncertainties caused by the Court of Chancery action had been resolved. In the early parts of July 2001, AeroGlobal also proposed an amendment of the AeroGlobal LOI to Cirrus, in which AeroGlobal's second stage investment of $30 million would be deferred until after the Court of Chancery issued a decision in favor of Cirrus and expiration of the time to appeal any such decision. The proposal would also allow AeroGlobal to place the remaining $3 million of the bridge loan into an escrow account, pending resolution of the lawsuit in the Court of Chancery. Cirrus rejected both proposals. However, on July 10, 2001, Cirrus agreed to and did amend the AeroGlobal LOI for the sole purpose of including an extension of the closing deadline for the $30 million investment from August 2, 2001 to August 10, 2001. At the same time it was having difficulties with the AeroGlobal loans, Cirrus began to consider other financing options. Nonetheless, Alan Klapmeier explicitly acknowledged that despite AeroGlobal's deferral of the remaining $3 million bridge loan payment, the exclusive negotiations provision contained in the AeroGlobal LOI remained in full force and prohibited Cirrus from discussing other financing options. On July 13, 2001, CHCL offered to dismiss the Chancery Court litigation against Cirrus in exchange for payment of $10 million. Cirrus rejected the offer but did begin to discuss the possibility of reviving the initial CHCL SPA.