Document: Pryor v. IAC/InterActiveCorp, C.A. No. 6884-CS (Del. Ch. June 7, 2012)
The Delaware Court of Chancery held that the delivery of notice of an arbitral award to a person appointed as a stockholder representative under a stockholders’ agreement was effective notice as to the other stockholder parties to the agreement. The stockholders’ agreement did not contain an express provision designating the stockholder representative as the other stockholders’ attorney-in-fact for all matters arising under the agreement. However, the stockholders’ agreement did confer exclusive authority on the stockholder representative to decide whether and when to exercise, on behalf of all stockholder parties to the agreement, the put right at issue in this case. In addition, the stockholders’ agreement granted the stockholder representative the exclusive role to act on behalf of the other stockholders in valuation and arbitration proceedings arising from the exercise of the put right. Accordingly, the Court found that service of notice of an arbitral award on the stockholder representative was effective notice on all stockholder parties for purposes of determining the timeliness of plaintiff’s challenge to an arbitral award arising from the stockholder representative’s exercise of the put right.