An international private equity fund has two classes of stock (A & B): A is located in one continent while B is located in another.  Previously, the investment strategy has been a "silo" approach; however, the fund wants to adopt a new strategy merging A and B into a single class of stock (C) that will be tied to investments in both far-flung locales.

An exchange price has been determined (A & B into C) through management's valuation analysis, and all shareholders agree but one—who only disputes the new strategy, not the price.  This sole shareholder has asked to be bought out at the exchange price, which requires a fairness opinion because: (1) the company is a 501(c)(3) organization; (2) the dissenting shareholder is selling his shares to another 501(c)(3) organization; and (3) the shareholder is also a member of the Board of Directors (related party).

In this context (fairness opinion versus appraisal rights), a subscriber asks, “is there some Delaware or Tax Court case law that supports the exchange price as fair market value?”

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