Chancery Dismisses Stockholder Challenge to PBC Change-of-Control Financing

Morris Nichols prevailed on behalf of lender Tilden Park Capital Management L.P. in a case addressing an issue of first impression. On July 29, 2026, the Delaware Court of Chancery dismissed a lawsuit brought by minority stockholders of MPower Financing, PBC, challenging a $20 million rescue financing that converted the company’s two largest lenders from roughly 25% owners into holders of nearly 85% of its stock.

The case presented a question of first impression for public benefit corporations, specifically, how the Revlon line of cases applies to the board of a PBC in a change-of-control transaction. The Court held that Revlon imposes no best-price standard of conduct on PBC directors.

Together with co-counsel Dechert LLP, Morris Nichols partner John DiTomo and attorney Jialu Zou successfully represented Tilden Park Capital Management L.P.