Opinion ID: 1478250
Heading Depth: 2
Heading Rank: 2

Heading: Mr. Barton's Testamentary Plan

Text: The Corporation is a non-public, closely-held Delaware corporation headquartered in Arkansas. It is engaged in the business of selling wholesale and retail lumber in the Mississippi Delta. The Corporation was formed in 1928 by E.C. Barton (Mr. Barton) and has two classes of common stock: Class A voting stock and Class B non-voting stock. Substantially all of the Corporation's stock was held by Mr. Barton at the time of his death in 1967. Mr. Barton was survived by his second wife, Martha K. Barton (Mrs. Barton) who died in 1985, and by Dorothy B. Rebsamen and Mary Lee Marcom, his daughter and granddaughter, respectively, from his first marriage. Pursuant to Mr. Barton's testamentary plan, 49 percent of the Class A voting stock was bequeathed outright to eight of his loyal employees. The remaining 51 percent, along with 14 percent of the Class B non-voting stock, was placed into an independently managed 15-year trust for the same eight people. Sixty-one percent of the Class B non-voting stock was bequeathed outright to Mrs. Barton. Mr. Barton's daughter and granddaughter received 21 percent of the Class B stock in trust. The non-voting Class B shares Mr. Barton bequeathed to his family represented 75 percent of the Corporation's total equity. Ownership interests in the Corporation began to change in the early 1970s following the distribution of Mr. Barton's estate. Mrs. Barton gave certain shares of Class B non-voting stock to her three children, Guy C. Blackwell, Owen G. Blackwell and Martha G. Hestand (the children). In 1973 the Corporation purchased all of the Class B stock held in trust for Mr. Barton's daughter and granddaughter at a price of $45 per share. [2] Mrs. Barton sold the remainder of her Class B shares to the Corporation in January 1975 at a price of $45 per share. These transactions left Mrs. Barton's three children collectively with 30 percent of the outstanding Class B non-voting stock. The children have no voting rights despite their substantial equity interest in the Corporation. The children are also the only non-employee Class B stockholders. There is no public market for, or trading in, either class of the Corporation's stock. This creates problems for stockholders, particularly the Class B minority stockholders, who wish to sell or otherwise realize the value of their shares. The corporation purported to address this problem in several ways over the years.