MORRIS I. GLASSMAN and WILLIAM STEINER, Plaintiffs Below, Appellants, v. UNOCAL EXPLORATION CORPORATION, UNOCAL CORPORATION, JOHN W. AMERMAN, ROGER C. BEACH, MacDONALD G. BECKET, CLAUDE S. BRINEGAR, MALCOLM R. CURRIE, RICHARD K. EAMER, FRANK C. HERRINGER, JOHN F. IMLE, JR., DONALD P. JACOBS, ANN McLAUGHLIN, NEAL E. SCHMALE, THOMAS B. SLEEMAN, RICHARD J. STEGEMEIER, and CHARLES R. WEAVER, Defendants Below, Appellees. IN RE UNOCAL EXPLORATION CORPORATION SHAREHOLDERS LITIGATION, 777 A.2d 242

Summary

A board of directors of a corporation which owned approximately 96 percent of the stock of another corporation and the subsidiary corporation's board of directors established committees to study a possible merger. The subsidiary corporation's committee consisted of three directors who, although also directors of the parent corporation, were not officers or employees of the parent company. The subsidiary corporation also retained financial and legal advisors to assist it during the review process and, after several meetings, its directors agreed to the merger at an exchange ratio of .54 shares of the parent corporation's stock for each share of the subsidiary corporation's stock. The state supreme court held that, in a short-form merger conducted pursuant to Del. Code Ann. tit. 8, § 253, the parent corporation did not have to establish entire fairness, and, absent fraud or illegality, appraisal was the only recourse for minority stockholders who were dissatisfied with the merger ...