PALM BEACH, Fla. and WILMINGTON, Del., April 10, 2017 /PRNewswire/ -- Shirley Shawe, a 1% owner of TransPerfect, recently made an offer to vote her share with TransPerfect co-CEO Elizabeth Elting, a 50% owner, in order to resolve the deadlock that the Chancery Court felt would harm the company and its valuation. Last week, Ms. Shawe's bid to cross lines in the contentious dispute for control of the company was not only denied by Ms. Elting, but was returned with a threat of holding Ms. Shawe in Contempt of Court for trying to settle the case. Despite this threat, Ms. Shawe will file a motion with the Chancery Court to compel a shareholder meeting to discuss and vote on what, in Delaware, has become known as the "51% Solution" -- to settle the TransPerfect case. TransPerfect has not held a shareholder meeting in over 13 months, giving Ms. Shawe the statutory right to convene a meeting and have her proposal heard.
Last month, Ms. Shawe offered to cede her vote as a shareholder, and vote against her son, co-CEO Philip Shawe, a 49% owner, in order to grant Elizabeth Elting, 51% control and the ability to select an entire slate of five board members, a plan which will permanently resolve the deadlock. Ms. Shawe's vote would give Elting complete operational control of TransPerfect's business. Ms. Shawe's proposal also satisfies both the letter and spirit of Delaware General Corporate Law §226, and enables the Chancery Court to declare success by having driven the parties to a consensual resolution, and Ms. Elting to declare success for having control of the business through her ability to select all five Board Members.
Ms. Shawe has heard Ms. Elting's proclamations that she wants operational control of the TransPerfect business, and has seen the Chancellor's decisions which are based on this premise. This has guided Ms. Shawe's decision to give Ms. Elting exactly what she wants, by offering to vote with her. This outcome would not only end the Court's only rationale for intervention, but also its only legal basis for ordering the unprecedented dissolution and forced sale of a solvent thriving company, and give Ms. Elting the victory she claims to have wanted. Ms. Shawe's offer drew an astonishing response; Elting's Delaware law firm proceeded to threaten Ms. Shawe, the 76-year old stockholder of TransPerfect, with Contempt of Court, for attempting to vote with their side and attempting to settle the case.
"I am glad that my lawyers have correctly worked through the Delaware law that allows me to save this company by voting with Ms. Elting to break deadlock. I very much hope that Liz and her attorneys at Potter Anderson do not threaten me again. I have never heard of a judge holding someone in Contempt for trying to settle a case. Kevin Shannon must think he has Chancellor Bouchard wrapped around his pinky-finger for Potter Anderson to threaten me with something so absurd as holding me in Contempt of Court for attempting to settle. I may be 76 years old, but I will not be pushed around by bullies in suits who are putting their own agendas ahead of TransPerfect," Shirley Shawe said.
Ms. Shawe continued, "I'm 76 years old, and my TransPerfect stock certificate is my only meaningful asset in this world, it's my personal property and my total net worth, and the S-Corp distributions that it produces are tax-advantaged and my sole source of income, and no -- I do not want to sell it for cash now, and will not do so voluntarily. Additionally, there are 4,000 employees who need their company's owners to make decisions with their best interest at heart, and I will keep pushing until we get there. I am gratified to have the support of many employees of TransPerfect, many of whom have reached out to me and thanked me for efforts to save their successful company from the court intervention that threatens it's existence."
"I am asking Chancellor Bouchard to realize that there is an offer on the table that would end the dispute and keep our successful company intact. Forcing all parties to meet with a ready solution in-hand, is the best way to guarantee our employees do not need to fear the outcome of this case any longer. The only people winning from this are the Custodian, his consultants, and the lawyers," Ms. Shawe said in closing.
Ms. Shawe's ownership was swiftly dismissed by Chancellor as meaningless, when Bouchard asked who Ms. Shawe was going to leave her 1% share of the company to upon her death -- and then concluded that, because she was elderly, her ownership rights were indistinguishable from that of her son's, and therefore had no value or merit today.
Ms. Shawe would also like to thank Senator Colin Bonini, and offer her public support to his recent "TransPerfect Bill" that would mandate prudent interim steps before allowing a judge to immediately jump to the "nuclear option" of a court-ordered forced sale of a profitable and solvent Delaware corporation. She will continue to pursue all avenues in the court system and legislative process, and has only just begun her fight to save TransPerfect and to preserve the jobs of its 4,000 workers.
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