Whitebox Concentrated Convertible Arbitrage Partners, L.P. v SuperiorWell Servs., Inc.

2011 NY Slip Op 05865 [86 AD3d 431]

July 7, 2011

Appellate Division, First Department

As corrected through Wednesday, August 31, 2011

Whitebox Concentrated Convertible Arbitrage Partners, L.P., et al.,Respondents, v Superior Well Services, Inc., Appellant.

—[*1]Simpson Thacher & Bartlett LLP, New York (Bruce D. Angiolillo of counsel), forappellant.

Ross & Orenstein LLC, Minneapolis, Minnesota (John B. Orenstein of counsel), forrespondents.

Order, Supreme Court, New York County (Charles E. Ramos, J.), entered March 3, 2011,which denied defendant's motion to dismiss the complaint, unanimously reversed, on the law,with costs, and the motion granted. The Clerk is directed to enter judgment in favor of defendantdismissing the complaint.

Defendant established by documentary evidence that the acquisition of more than 50% of itsstock and the subsequent merger with Diamond Acquisition Corporation did not constitute a"Fundamental Change" as defined in the certificate of designations, which would have requireddefendant to provide a fundamental change notice to its preferred shareholders within 10 days ofa fundamental change. The tender offer for common shares and defendant's subsequent mergerinto Diamond, with defendant being the surviving entity, were two consecutive steps in a single,integrated transaction (see Noddings Inv. Group, Inc. v Capstar Communications,Inc., 1999 WL 182568, 1999 Del Ch LEXIS 56 [Del Ch 1999], affd 741 A2d 16 [Del1999]).

The plain language of the certificate of designations for the convertible preferred stockunambiguously demonstrated that defendant, a Delaware corporation, did not effect afundamental change (see Bailey v Fish& Neave, 8 NY3d 523, 528 [2007]). The fact that plaintiffs attached a particular,subjective meaning to the term "transaction" that differed from the term's plain meaning did notrender the term ambiguous (see SlatterySkanska Inc. v American Home Assur. Co., 67 AD3d 1, 15 [2009]; Innophos, Inc. v Rhodia, S.A., 38AD3d 368, 369 [2007], affd 10 NY3d 25 [2008]). Concur—Andrias, J.P.,Sweeny, Renwick, Freedman and Manzanet-Daniels, JJ.