Chapter 8 - The Hostile Takeover
The peace in our bungalow didn't last forty-eight hours.
On Thursday evening, Lucas called me in an urgent panic. ""Claire, get the television on immediately. Evelyn Sullivan just allied with a private equity group out of Boston. They’ve launched a hostile takeover bid for Sullivan Group.""
I turned on CNBC. The headlines were blaring red: EVELYN SULLIVAN AND VANCE HOLDINGS LAUNCH $4.2 BILLION TENDER OFFER TO OUST ETHAN SULLIVAN FROM FOUNDER ROLE.
Arthur Sterling appeared on screen, announcing that the board had determined Ethan's public scandals rendered him mentally incompetent to lead the firm. If the tender offer succeeded by Friday afternoon at market close, Ethan would be completely stripped of his company, his patents, and his intellectual property.
Five minutes later, Ethan knocked frantically on our door. He looked exhausted, his hair rumpled from running his hands through it, holding an iPad covered in financial spreadsheets.
""Claire, I'm sorry to bring this to your doorstep,"" Ethan said breathlessly as I let him in. ""The vote is at 3:00 PM tomorrow. Vance Holdings bought fifteen percent of the floating shares on the open market today. Combined with my mother’s trust, they control forty-nine percent. If they acquire just two more percent from institutional brokers, they take Sullivan Group.""
Noah, who had been doing sixth-grade algebra at the dining table, quietly walked over and took the iPad out of Ethan’s hands.
""Let me see that,"" Noah murmured.
""Noah, this is complex institutional finance,"" Ethan began gently.
""Silence, please,"" Noah ordered, scrolling through the shareholder registers at lightning speed. His little fingers swiped across debt covenants, option schedules, and proxy filings. After two minutes, Noah adjusted his glasses and looked up at Ethan.
""Your father’s original corporate charter from 1998 had a family legacy clause, correct?"" Noah asked.
Ethan blinked. ""Yes... but that clause required an heir of direct bloodline to co-sign any voting block reallocation.""
""And two days ago, you transferred twenty percent of your personal voting stock into an irrevocable trust for Sophie and me,"" Noah said, a razor-sharp smirk spreading across his face. ""Which makes Sophie and me the legal guardians of the Sullivan Legacy Proxy block. Under section fourteen, sub-article B of your own corporate bylaws, any hostile tender offer made by a non-lineage shareholder can be unilaterally frozen for ninety days if the direct heirs invoke the Right of First Refusal.""
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Ethan stared at his ten-year-old son with a mixture of terror and awe. ""You read our bylaws?""
""I read them on Tuesday night while eating chicken nuggets,"" Noah replied casually. ""Call your corporate secretary. We’re going to the board meeting tomorrow. And this time, I’m bringing Sophie.""
