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which do not apply tax-affecting is unpersuasive because Kettell
testified that ASA’s Board of Examiners approved Kettell for ASA
certification even though he submitted a report to the board that
did not tax-affect S corporation income. Respondent’s expert
witnesses do not automatically tax-affect all S corporation
earnings.
Nammacher’s testimony about valuing ESOP stock for the
Department of Labor is not convincing because there is no
evidence that the Department of Labor’s definition of value is
similar to the definition of fair market value in this case.
c. Del. Open MRI Radiology Associates, P.A. v.
Kessler
Petitioner contends that the reasoning in Del. Open MRI
Radiology Associates, P.A. v. Kessler, 898 A.2d 290 (Del. Ch.
2006), supports application of tax-affecting in this case. We
disagree. The issue in Del. Open MRI was whether the minority
stockholders of Delaware Open MRI Radiology Associates, P.A.,
received fair value of the going concern in a merger (fair merger
price). Id. at 299, 310. The court of chancery said the fair
merger price had to take into account the loss of the favorable
tax treatment for the S corporation shareholders. Id. at 326.
The fair merger price reflected equitable considerations
including the possibility that in a merger minority shareholders
might be squeezed out. Id. at 311-312.
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