Harff v. Kerkorian

QUILLEN, Chancellor:

This action is a combined derivative and class action challenging a singular corpo rate act — the declaration and payment of a $1.75 per share dividend by Metro-Goldwyn-Mayer, Inc., in the late fall of 1973.

Plaintiffs are holders of 5% convertible subordinated debentures due 1993 which were issued by Metro-Goldwyn-Mayer, Inc. (MGM), pursuant to an Indenture Agreement between MGM and The Chase Manhattan Bank (Trustee) dated July 1, 1968. On November 21, 1973, the Board of Directors of MGM declared a cash dividend, the first cash dividend since 1969, in the amount of $1.75…