Unformatted text preview: - The court concluded that the board was grossly negligent- Violated the duty of care to the shareholders Business Judgement Rule ...acting in good faith…- Protects disinterested investors acting in good faith without jeopardizing their personal finances- The $55/share price was based on leveraged buyout valuation It is a low valuation of a company because it is valued by the bank- Should’ve seeked out a professional opinion about the valuation of the company- You cannot regard the $55 price as the intrinsic value of the company because no one else knew that the company was up for sale so nobody else could make offers. ..it’s a lockup....
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- Spring '11
- Business Ethics, Corporation, Van Gorkom