Chancery Holds Common Stockholders Can (Sometimes) Waive Appraisal Rights
In Manti Holdings LLC et al v. Authentix Acquisition Company, Inc., the Delaware Court of Chancery held a stockholder could waive appraisal rights in a stockholders agreement. The Court noted:
- The stockholders agreement was not a contract of adhesion. Sophisticated parties were involved and were represented by counsel, and counsel exchanged drafts of the proposed stockholders agreement before agreeing to a final contract.
- There is no record evidence that the petitioners were not fully informed.
- The Delaware General Corporation Law, or the DGCL, does not explicitly prohibit contractual modification or waiver of appraisal rights, nor does it require a party to exercise its statutory appraisal rights. Thus, such modification or waiver serves to supplement the DGCL, and is not inconsistent with, nor contrary to, the DGCL.
- The stockholders agreement clearly and unambiguously waived appraisal rights.
- The Court did not decide whether a waiver of appraisal would be upheld in other circumstances.
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