Court of Chancery of Delaware

In an action brought by stockholders of a rural Illinois bank holding company subject to a cash out merger used to reclassify the company as an S corporation, the court finds that: 1) the merger was presumptively subject to entire fairness review; 2) the merger was financially unfair to plaintiff class; 3) directors disclosed all material facts in connection with the merger; 4) thus, stockholders who voted for the merger were barred from recovery; 5) stockholders who did not vote for the merger were not barred from recovery; and 6) recovery of the stockholders who did not seek appraisal will track the recovery of the plaintiffs who perfected their appraisal rights.

Appellate Information

• Decided 08/18/2006
• Published 09/07/2006

Judges

Court

• Court of Chancery of Delaware

Counsel