City of Pontiac Police and Fire Retirement System v. Dayforce, Inc.

majority opinion

IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE

CITY OF PONTIAC POLICE )

AND FIRE RETIREMENT )

SYSTEM, ROGER SMITH, and )

GEORGE ASSAD, )

)

Plaintiff, C.A. No. 2026-0073-LM

)

v. )

)

DAYFORCE, INC., )

Defendant. )

Date Submitted: June 17, 2026

Final Report: August 6, 2026

POST-TRIAL FINAL REPORT

Peter B. Andrews, David M. Sborz, Andrew J. Peach, Jackson E. Warren, Jacob D. Jeifa, ANDREWS & SPRINGER LLC, Wilmington, Delaware; Joel Fleming,

Lauren Godles Milgroom, EQUITY LITIGATION GROUP LLC, Boston, MA; D.

Seamus Kaskela, Adrienne Bell, KASKELA LAW LLC, Newtown Square, PA;

Counsel for Plaintiff Roger Smith.

Ned Weinberger, Mark D. Richardson, Brendan W. Sullivan, LABATON KELLER SUCHAROW LLP, Wilmington, Delaware; John Vielandi, Jiahui (Rose) Wang, LABATON KELLER SUCHAROW LLP, New York, NY; Cynthia Billings-Dunn,

ASHERKELLY LAW, Southfield, MI; Counsel for Plaintiff City of Pontiac Police and Fire Retirement System.

Kimberly A. Evans, Lindsay K. Faccenda, Daniel M. Baker, BLOCK & LEVITON LLP, Wilmington, DE; Jason M. Leviton, BLOCK & LEVITON LLP, Boston, MA; Counsel for Plaintiff George Assad.

Kevin R. Shannon, Berton W. Ashman, Jr., Daniel M. Rusk, IV, Justin T. Hymes, POTTER ANDERSON & CORROON LLP, Wilmington, DE; Counsel for

Defendant Dayforce, Inc.

MITCHELL, M.

I. INTRODUCTION

This post-trial report resolves a books-and-records action brought by City of

Pontiac Police and Fire Retirement System, Roger Smith, and George Assad

(“Plaintiffs”) under 8 Del. C. § 220 arising from the Merger in which private equity

funds affiliated with Thoma Bravo, L.P. (“Thoma Bravo”) acquired Dayforce, Inc.

(“Dayforce” or the “Defendant”).

Plaintiffs seek to inspect additional books and records to investigate potential

wrongdoing in connection with the Merger. Dayforce produced records responsive

to Plaintiffs’ inspection demands but declined to produce others. Plaintiffs contend

they are entitled to inspect additional categories of records under Section 220, while

Dayforce maintains its production satisfied the statutory requirements. For the

reasons that follow, the Court grants Plaintiffs’ demand in part and denies it in part.

This is my post-trial final report.

II. FACTUAL BACKGROUND 1

A. The Parties

Dayforce is a Delaware corporation headquartered in Minneapolis,

Minnesota.2 Dayforce provides cloud-based human-capital management and

payroll software solutions to enterprise clients.3 David Ossip founded Dayforce in

2009. 4 He served as CEO and Chairman of the Board and owned approximately 4%

of outstanding shares at the time of the Merger.5

Plaintiffs City of Pontiac Police and Fire Retirement System, Roger Smith,

and George Assad have been beneficial owners of shares of Dayforce common stock

until the closing of the Merger.6 Plaintiffs seek inspection of Dayforce’s books and

records under Section 220 to investigate potential wrongdoing in connection with

the transaction.7 Matthew Nye is a trustee of City of Pontiac Police and Fire

The facts in this report reflect my findings based on the record developed at the half-day trial held on June 17, 2026. I grant the evidence the weight and credibility I find it deserves. Citations to the Docket are cited in the form of “D.I. __.” The parties submitted joint exhibits numbered 1–103. Citations to the joint exhibits are in the form of “JX__.” 2

D.I. 28 at 2.

Id.

D.I. 13 at 5.

Id.

D.I. 28 at 2.

See generally D.I. 1.

Retirement System, who verified the October 9, 2025 demand. 8 Roger Smith and

George Assad likewise submitted declarations stating that they beneficially owned

Dayforce common stock continuously since at least June 2025 and May 2025,

respectively.9 The parties do not dispute that Plaintiffs satisfied Section 220’s

stockholder-status requirement.

B. The Merger

On August 21, 2025, Dayforce announced that it had entered into a definitive

agreement to be acquired by entities affiliated with Thoma Bravo in a transaction

valued at approximately $12.3 billion (the “Merger”). 10 Under the agreement and

plan of the Merger, Dayforce stockholders would receive cash consideration of $70

per share for each share of Dayforce common stock they held. 11 The Merger resulted

in Dayforce becoming a privately held company after the transaction.12

The day after the Merger was announced, Ossip shared a post about the

Merger and announced that “This will continue to be fun!!” 13 Additionally,

contemporaneous news articles reported that Dayforce executives were expected to

D.I. 1, Ex. 2, Ex. A ¶ 1.

D.I. 1, Ex 3, Ex. 2; D.I. 1, Ex 1, Ex. 1.

D.I. 28 at 3.

Id. at 3–4.

JX 57 § 1.01.

D.I. 13 at 31.

remain and quoted Ossip saying, “I’m going nowhere.”14 These statements

prompted questions regarding whether Dayforce’s senior management discussed or

reached any understanding regarding post-closing roles before the Merger

Agreement was executed.

On September 29, 2025, Dayforce filed its Proxy statement (“Proxy”).15 The

Proxy stated “none of [Dayforce’s] executive officers . . . discussed or entered into

any agreement with [Thoma Bravo] regarding [post-closing] employment” before

the Merger Agreement was signed.16 The record reflects communications indicating

Thoma Bravo’s interest in retaining existing management, including references to

“figure out how to back this guy[.],” and a desire to “. . . partner with the existing

team[.]” 17 The Proxy also discussed the executive RSUs and PSUs—including

Ossip’s—converting into “Replacement Awards,” rather than being cashed out in

the Merger.18 Plaintiffs contend these facts are inconsistent with the Proxy’s

disclosures and form part of the basis for their inspection demands. On November

Id.

D.I. 15 at 22.

D.I. 13 at 31.

D.I. 17 at 12; D.I. 15 at 13.

D.I. 13 at 35.

12, 2025, Dayforce stockholders approved the Merger at a special meeting of

stockholders.19

C. Section 220 Demands and Dayforce’s Production

On September 30, 2025, George Assad served Dayforce with his demand,

under Section 220, for inspection of books and records (the “Assad Demand”).20

The demand sought “inspection . . . to investigate possible mismanagement [or]

breaches of fiduciary duty by [Dayforce’s] officers [or] directors in connection with

the Merger.”21 On October 9, 2025, City of Pontiac Police and Fire Retirement

System served Dayforce with its demand, under Section 220, for inspection of books

and records (the “Pontiac Demand”).22 The demand sought inspection “to

investigate and assess potential misconduct, wrongdoing, [or] breaches of fiduciary

duty by members of the Board and senior management in connection with

[Dayforce’s] agreement to be acquired by [Thoma Bravo].”23

On November 5, 2025, Roger Smith served Dayforce with his demand, under

Section 220, for inspection of books and records (the “Smith Demand”).24 The

D.I. 28 at 4.

Id.

D.I. 1, Ex. 1.

D.I. 1, Ex. 2.

Id.

D.I. 1, Ex. 3.

demand sought inspection “to investigate possible breaches of fiduciary duty and

other misconduct or wrongdoing committed by [Dayforce’s] fiduciaries in

connection with the [Merger].”25 Although the demands were served separately,

they sought substantially similar categories of documents relating to the Merger

process, the Board’s consideration of the transaction, and the conduct of Dayforce’s

fiduciaries.

Between October 17 and December 24, 2025, Dayforce produced 54

documents responsive to these demands, which included formal board materials.26

On January 8, 2026, Dayforce informed Plaintiffs that: “Dayforce certifies that, to

the best of its knowledge, [its] production is complete.”27 Plaintiffs thereafter

maintained that Dayforce’s production was incomplete and that additional categories

of books and records remained necessary to fulfill the purposes identified in their

demands. This action followed.

D. Procedural History

On January 15, 2026, Plaintiffs filed their Verified Complaint to Compel

Inspection of Books and Records under 8 Del. C. § 220. 28 On February 3, 2026, the

Id.

D.I. 28 at 4.

Id. at 5.

See generally D.I. 1.

Court entered a Stipulation and Order. 29 Plaintiffs seek an Order from this Court

entering judgment in favor of Plaintiffs and against Dayforce as follows: Ordering

Dayforce to produce: (i) informal board materials concerning David Ossip’s

anticipated post-closing employment; (ii) informal Board and officer-level materials

concerning alleged discrepancies between the Proxy and the Board’s deliberative

process to fill gaps regarding discussions between management and the Board about

the Merger; and (iii) short- and long-range plans and related financial forecasts. The

Court held a trial on June 17, 2026, and took the matter under advisement. 30

III. ANALYSIS

A. Governing Legal Standard

The amended Section 220, as revised by Senate Bill No. 21 (“SB 21”), alters

the categories of corporate records available for inspection and the burden of proof

a stockholder must make to obtain them. Because the scope of relief now depends

on the type of records requested, the Court must proceed in stages.

First, a stockholder must satisfy Section 220(b) by submitting a “written

demand under oath.”31 When the demand seeks records beyond the stock ledger or

stockholder list, the stockholder must establish three other requirements. The

D.I. 28 at 5.

See generally D.I. 25.

8 Del. C. § 220(b)(1).

demand must (1) establish good faith and a proper purpose; (2) describe with

reasonable particularity both the purpose of the inspection and the records sought;

and (3) show the requested records are reasonably related to the stated purpose.32

Second, if those threshold requirements are met, the Court may order

inspection of the statute’s enumerated categories of “books and records” identified

in Section 220(c).33 If the corporation lacks specified formal records, the Court may

order production of their functional equivalents, limited to materials necessary and

essential to accomplish the stockholder’s proper purpose.34

Third, requests for non-enumerated records proceed under Sections

220(g)(2)–(3). Under Sections 220(g)(2)–(3), when a stockholder seeks records

outside the enumerated categories, the stockholder must show a compelling need

and prove by clear and convincing evidence that the specific records are necessary

and essential to further the stockholder’s proper purpose. 35

The Court evaluates each disputed category of records separately to determine

whether Plaintiffs are entitled to inspection under the statutory framework, including

the heightened requirements applicable to records outside the statute’s enumerated

categories.

8 Del. C. § 220(b)(2).

8 Del. C. § 220(c).

8 Del. C. § 220(f).

8 Del. C. § 220(g)(2); 8 Del. C. § 220(g)(3).

B. Plaintiffs Have Established a Proper Purpose and a Credible Basis

to Investigate Potential Wrongdoing.

Before the Court may compel inspection, a stockholder must establish that the

demand satisfies the statutory prerequisites discussed above. Plaintiffs must show

that they seek inspection for a proper purpose and that the record establishes a

credible basis from which the Court can infer possible wrongdoing warranting

further investigation.36 Although Plaintiffs bear the burden of satisfying both

requirements, the credible-basis standard imposes only a minimal evidentiary burden

and has been described as the lowest burden of proof in Delaware. 37 The Court

addresses each requirement in turn.

1. Plaintiffs Have Established a Proper Purpose.

Plaintiffs contend they seek inspection to investigate potential breaches of

fiduciary duty and other wrongdoings arising from Dayforce’s Merger.38

See 8 Del. C. § 220(b)(2)(a).

AmerisourceBergen Corp. v. Lebanon Cnty. Employees’ Ret. Fund, 243 A.3d 417, 431– 32 (Del. 2020) ([U]nder Section 220, a stockholder who wishes to investigate corporate wrongdoing must present a credible basis from which the court can infer that wrongdoing may have occurred. It bears repeating that this test ‘reflects judicial efforts to maintain a proper balance between the rights of shareholders to obtain information based upon credible allegations of corporation mismanagement and the rights of directors to manage the business of the corporation without undue interference from stockholders.’ Having struck that balance, this Court has not required stockholders to prove that the wrongdoing they seek to investigate is actionable. To the contrary, we have stated that a stockholder is not required to prove that wrongdoing occurred, only that there is ‘possible mismanagement that would warrant further investigation.’”).

D.I. 13 at 2.

Investigating potential wrongdoing constitutes a proper purpose under Section 220

when that purpose is reasonably related to the stockholder’s interest as a

stockholder. 39

Here, Plaintiffs’ demands articulate a proper purpose. Plaintiffs seek to

investigate whether Dayforce’s fiduciaries complied with their disclosure and

fiduciary obligations during the sale process. 40 In particular, Plaintiffs question

whether the Proxy accurately disclosed the nature and timing of discussions

concerning senior management’s anticipated post-closing employment and whether

the Proxy’s description of the Board’s deliberative process is consistent with the

formal corporate record.41 Plaintiffs’ asserted concerns center on several issues.

First, Plaintiffs point to the Proxy’s representation that none of Dayforce’s executive

officers discussed post-closing employment with Thoma Bravo before execution of

the Merger Agreement.42 Plaintiffs contend that disclosure is difficult to reconcile

with contemporaneous statements that Dayforce executives were expected to remain

after the transaction, Ossip’s public statements that “[t]his will continue to be fun!!”

and “I’m going nowhere,” the Proxy’s discussion of executive “Replacement

8 Del. C. § 220(b).

D.I. 13 at 3–4, 30.

Id. at 4, 52.

Id. at 31.

Awards,” and evidence that Thoma Bravo sought to partner with the existing team

from the outset of the transaction.43

Second, Plaintiffs identify inconsistencies between the Proxy’s narrative

describing the Merger process and the Board’s formal minutes, including the

existence of executive sessions that Plaintiffs contend are not fully reflected in the

corporate record. 44 According to Plaintiffs, these circumstances warrant further

investigation into whether the Proxy accurately described the Board’s deliberations

and the events leading to the Merger.45

Those are quintessential Section 220 purposes. Investigating whether

directors and officers complied with their fiduciary duties and whether stockholders

received accurate disclosures in connection with the sale of a corporation is

reasonably related to Plaintiffs’ interests as stockholders. The Court concludes that

Plaintiffs have established a proper purpose under Section 220.

2. Plaintiffs Have Established a Credible Basis to Investigate

Potential Wrongdoing.

Having determined that Plaintiffs seek inspection for a proper purpose, the

Court next considers whether Plaintiffs have established a credible basis from which

the Court may infer possible wrongdoing. The credible-basis standard is the lowest

Id. at 31, 35, 43–45.

Id. at 55–60.

Id. at 42, 55.

burden of proof in Delaware.46 It does not require Plaintiffs to prove that fiduciary

misconduct occurred or even that wrongdoing is more likely than not. Rather,

Plaintiffs need only present some evidence from which the Court can infer a credible

possibility of wrongdoing that would further warrant an investigation.47 Here,

Plaintiffs satisfy that burden.

Plaintiffs identify inconsistencies between the Proxy’s disclosures concerning

post-closing employment and contemporaneous statements by Dayforce’s senior

management and Thoma Bravo.48 Plaintiffs point to alleged discrepancies between

the Proxy’s narrative describing the Board’s consideration of the Merger and the

formal Board minutes documenting portions of that process. 49 Considered together,

these circumstances provide a credible basis to investigate whether Dayforce’s

fiduciaries fulfilled their disclosure and fiduciary obligations in connection with the

Merger.

With respect to post-closing employment, the Proxy affirmatively represents

that none of Dayforce’s executive officers discussed or entered into any agreement

regarding post-closing employment with Thoma Bravo before the execution of the

Seinfeld v. Verizon Commc’ns, Inc., 909 A.2d 117, 123 (Del. 2006).

Id.

D.I. 13 at 55–60.

See generally D.I. 13 at 31–35, 43–45, 55–60.

Merger Agreement.50 Yet the record reflects that immediately following the

announcement of the transaction, David Ossip publicly made several inconsistent

statements previously discussed. The record further reflects that Thoma Bravo

viewed retaining Dayforce’s existing management team as an important component

of the transaction. 51 These facts provide some evidence supporting Plaintiffs’

request to investigate whether discussions regarding management continuity

occurred before the execution of the Merger Agreement.

The record likewise establishes a credible basis to investigate the adequacy of

the Board’s disclosed deliberation process.52 Plaintiffs identify several instances in

which the Proxy’s description of the Merger negotiations differs from what appears

in the formal Board minutes. 53 Plaintiffs also point to Board meetings at which

executive sessions occurred without separately memorialized minutes. 54 These

asserted gaps provide a sufficient factual predicate to inquire whether the formal

record fully reflects the Board’s consideration of the transaction and the information

presented to it throughout the sale process. Dayforce responds that the alleged

discrepancies are either immaterial or reflect Plaintiffs’ attempt to manufacture

D.I. 13 at 44.

D.I. 17 at 11–15.

D.I. 13 at 55–60.

Id. at 44; D.I. 17 at 22–23.

See D.I. 13 at 36, 55–60.

inconsistencies where none exist. 55 At this stage, the Court does not resolve

competing factual inferences or determine whether fiduciary misconduct actually

occurred. The question is simply whether Plaintiffs have presented sufficient

evidence to warrant further investigation. They have.

Accordingly, the Court concludes that Plaintiffs have established a credible

basis to investigate potential wrongdoing in connection with the Merger.

C. Plaintiffs are Entitled to Inspect Certain, But Not All, of the

Requested Additional Records.

Having concluded that Plaintiffs have established both a proper purpose and

a credible basis to investigate potential wrongdoing, the Court considers the scope

of inspection to which Plaintiffs are entitled. The fact that Plaintiffs have established

a proper purpose and a credible basis to investigate potential wrongdoing does not

automatically entitle them to every category of documents requested in their

demands. Under Section 220(g), a stockholder seeking records beyond the statute’s

enumerated categories must establish a compelling need for those materials and

prove by clear and convincing evidence that the specific records sought are

necessary and essential to further the stockholder’s proper purpose. 56

D.I. 15 at 33–38.

8 Del. C. § 220(g)(2)–(3).

1. Plaintiffs Have Not Demonstrated Entitlement to Broad

Informal Materials Concerning Ossip’s Post-Closing

Management Employment.

Plaintiffs seek production of informal Board and officer-level materials

concerning the timing and substance of discussions between Thoma Bravo and

David Ossip regarding Ossip’s anticipated post-closing employment. 57 The request

for informal board and officer-level communications regarding anticipated postclosing roles for senior management, including when and how Mr. Ossip confirmed

continued service, falls within the non-enumerated lane of Section 220(g)(2)–(3).

Plaintiffs therefore must demonstrate a compelling need and prove by clear and

convincing evidence that the specific informal communications sought are necessary

and essential to investigate the asserted disclosure and process concerns.

On this record, Plaintiffs have not carried that burden. Plaintiffs rely

principally on pre-amendment decisions such as Palantir, Calgon, Squarespace,

Empire Resorts, Whole Earth, and SharpSpring, arguing that informal

communications should be produced where formal Board materials do not fully

capture discussions of management’s post-closing employment or where proxy

disclosures are inconsistent with the formal corporate record. 58 But that authority

D.I. 13 at 50–54.

D.I. 13 at 50–54; KT4 Partners LLC v. Palantir Techs. Inc., 203 A.3d 738 (Del. 2019); Inter-Loc. Pension Fund GCC/IBT v. Calgon Carbon Corp., 2019 WL 479082 (Del. Ch. Jan. 25, 2019), aff’d, 237 A.3d 818 (Del. 2020); Mich. Elec. Empls.’ Pension Fund v. Squarespace, Inc., C.A. No. 2024-1041-SEM (Del. Ch. Dec. 3, 2025); Brown v. Empire

predates SB 21’s express three-lane framework and its clear-and-convincing,

compelling-need requirement for non-enumerated materials. Those cases may still

inform the credible-basis inquiry and illustrate when informal materials can be

appropriate, but they do not displace the amended statute’s burdens and tailoring

requirement.

Plaintiffs frame their request as targeted, not a “tell me more” request, seeking

the specific materials necessary to determine when and how Ossip’s anticipated

post-closing role was discussed, because in their view, the formal Board materials

do not explain when Ossip confirmed he would remain with Dayforce following the

Merger. 59 But the question before the Court is not whether additional

communications might exist. It is whether Plaintiffs have demonstrated by clear and

convincing evidence that the specific informal board and officer-level materials they

request are necessary and essential to answer that question. They have not.

The formal board materials, together with the Proxy and the public statements

on which Plaintiffs rely, already frame the issue Plaintiffs seek to investigate. Those

materials may not definitively resolve when or how Ossip’s post-closing role was

decided, but Plaintiffs have not shown that the requested informal communications

Resorts, Inc., C.A. No. 2019-0908-KSJM (Del. Ch. Feb. 20, 2020); Dodiya v. Whole Earth Brands, Inc., C.A. No. 2024-1033-LWW (Del. Ch. Jan. 29, 2025); Hightower v. SharpSpring, Inc., 2022 WL 3970155 (Del. Ch. Aug. 31, 2022).

D.I. 13 at 52.

are the only meaningful source of the information, or that the formal record is so

deficient that they need to resort to informal Board and officer communications.

Defendant produced Board minutes, presentations, and the Proxy itself, all of which

permit Plaintiffs to investigate the timing and circumstances surrounding the Merger

and Ossip’s anticipated post-closing role. Ordering the production of the requested

informal communications on this record would exceed what Section 220(g)(2)–(3)

requires.

Accordingly, the Court concludes that Plaintiffs have not established a

compelling need for the production of informal materials concerning Ossip’s postclosing employment because the existing formal materials and Proxy suffice to

frame the inquiry and because Plaintiffs have not shown that informal

communications are necessary and essential.

2. Plaintiffs Have Not Demonstrated That Inspection of

Informal Materials to Fill Material Gaps in the Minutes is

Warranted.

Plaintiffs seek informal materials to fill perceived gaps in minutes for

executive sessions held during the Board meetings on October 29, 2024, February

28, 2025, and May 2, 2025.60 Plaintiffs contend that the absence of separately

memorialized executive-session materials creates gaps in the Board’s formal record

and prevents Plaintiffs from fully assessing the Board’s deliberative process leading

D.I. 13 at 55.

to the Merger.61 This request, to inspect informal materials to fill gaps in executivesession minutes, would proceed under Section 220(g)(2)–(3) and require clear and

convincing proof of a compelling need and necessary-and-essential tailoring.

According to Plaintiffs, the Proxy recounts substantive executive-session

discussions at each of those meetings including Ossip’s outreach and updates

regarding Thoma Bravo’s interest, management’s reports regarding competing

bidder contracts, and ongoing price negotiations that are absent from the minutes

produced in response to the demands.62 Relying principally on Whole Earth,

Squarespace, Zendesk, and Palantir, Plaintiffs contend that where a proxy describes

deliberations not reflected in the formal minutes, informal Board materials including

emails, notes, and other communications may constitute the functional equivalent of

missing formal records or otherwise satisfy Section 220(g).63

Plaintiffs emphasize the Company’s acknowledgment that no separate

executive-session minutes exist for some sessions. 64 Plaintiffs characterize this issue

as analogous to Whole Earth, where the Court ordered production of informal Board

and officer-level materials after concluding that the proxy described deliberations

Id. at 55–59.

Id. at 56–57.

Id. at 55–59; Whole Earth, C.A. No. 2024-1033-LWW; Squarespace, Inc., C.A. No. 2024-1041-SEM; In re Zendesk, Inc. Section 220 Litig., 2023 WL 5496485 (Del. Ch. Aug. 25, 2023); Palantir, 203 A.3d 738.

D.I. 13 at 57.

from numerous meetings which were not reflected in the minutes. 65 Plaintiffs

likewise rely on Squarespace and Zendesk, arguing that minutes containing only

“bland references” of material events cannot satisfy a stockholder’s inspection

rights.66 Plaintiffs invoke NVIDIA, Empire Resorts, and Palantir for the proposition

that, where formal corporate records fail to document material Board discussions,

inspection may extend to informal materials to bridge those gaps.67 According to

Plaintiffs, the same principle applies here because the Proxy recounts substantive

discussions concerning Thoma Bravo’s outreach, the Board’s authorization for

Ossip to engage with Thoma Bravo, and management’s updates regarding price

negotiations and competing bidders, while the formal minutes merely note that the

Board entered an executive session.

Plaintiffs cite cases to support the proposition that a Proxy’s narrative can

contribute to a credible basis to investigate potential wrongdoing. But a Proxy with

greater narrative detail than the Board minutes does not, standing alone, satisfy

Section 220(g)(2)–(3)’s requirement to prove by clear and convincing evidence that

Whole Earth, C.A. No. 2024-1033-LWW, Tr. at 22.

D.I. 13 at 58.

See NVIDIA Corp. v. City of Westland Police & Fire Ret. Sys., 282 A.3d 1, 27–28 (Del. 2022) (affirming production of informal materials where formal board materials did not address the subject matter of the demand); Empire Resorts, C.A. No. 2019-0909-KSJM, at 54–57 (TRANSCRIPT) (ordering electronic communications where formal materials did not fully explain events); Palantir, 203 A.3d at 756–58; Whole Earth, C.A. No. 2024-1033-LWW, Tr. at 21.

non-enumerated records are necessary and essential. Nor does the absence of

separate executive-session minutes establish that additional records exist or that

emails, notes, or similar informal communications are necessary and essential under

Section 220(g). The statute requires a showing tethered to specific records and a

demonstration that the information cannot reasonably be obtained from the

enumerated materials or their functional equivalents.

On this record, Plaintiffs have not shown by clear and convincing evidence

that informal executive-session materials exist and that they are necessary and

essential to investigate the alleged discrepancies, where the formal Board materials

and the Proxy have already been produced. To permit inspection based largely on

speculation that executive session discussions may contain additional relevant

information would be inappropriate and would not satisfy Section 220(g)’s

heightened burden.

3. Plaintiffs Are Entitled to Inspect Forecasts.

Plaintiffs seek production of the short- and long-range plans and related

financial forecasts that were provided to and reviewed by the Board at the October

29, 2024, January 30, 2025, February 28, 2025, and May 2, 2025 meetings.68

According to Plaintiffs, these materials are necessary to evaluate the information

available to the Board when it considered the Merger and to assess whether the Proxy

D.I. 13 at 60.

accurately described the Board’s deliberative process.69 Dayforce responds that it

has produced the formal books and records concerning the Merger, including the

financial information presented to the Board when considering the Merger.70

Here, Plaintiffs are entitled to inspect these materials. Those forecasts are

within the scope of inspection because they reflect the financial information actually

presented to the Board in connection with the Merger and are necessary and essential

to evaluate the Board’s deliberations and the financial analyses disclosed to

stockholders. The Court orders production of the short and long-range plans and

related financial forecasts provided to and reviewed by the Board at the October 29,

2024, January 30, 2025, February 28, 2025, and May 2, 2025 meetings, as identified

in the Proxy. Those forecasts informed the Board’s consideration of the transaction

and the financial analyses performed in connection with the Merger.

Accordingly, those forecasts are necessary and essential for Plaintiffs to

evaluate the information available to the Board satisfying Section 220(g).

IV. CONCLUSION

For the foregoing reasons, the Court concludes that Plaintiffs are entitled to

inspect certain books and records consistent with this Report but have not established

an entitlement to all categories of records requested under Section 220(g).

Id. at 60–61.

D.I. 15 at 52.

Accordingly, judgment should be entered in favor of Plaintiffs in part and in favor

of Defendant in part. Inspection is granted for the forecasts provided to and reviewed

by the Board at the October 29, 2024, January 30, 2025, February 28, 2025, and May

2, 2025 meetings. Inspection is denied as to informal post-closing employment

communications and informal executive-session materials because Plaintiffs have

not met § 220(g)(2)–(3)’s compelling-need, clear-and-convincing standard.

This is the Court’s post-trial final report and expedited exceptions may be

filed within three days under Court of Chancery Rule 144. If no exceptions are

taken, the parties shall meet and confer regarding the additional production required

by this final report and submit a proposed implementing order consistent with its

terms within one week thereafter.

City of Pontiac Police and Fire Retirement System v. Dayforce, Inc.

Authorities cited

Opinion · public domain