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Commercial Assets Inc. won a Delaware Chancery Court judge’s approval of a settlement of shareholder lawsuits challenging a $53 million buyout of the real estate investment firm by Asset Investors Corp. Vice Chancellor Leo Strine approved the settlement — which gave Commercial Assets shareholders the option to accept cash for their shares rather than Asset Investors’ stock — at a hearing in Wilmington, Del. Aug. 3. He also approved $640,000 in fees and expenses for investors’ lawyers and the lead plaintiff in the case. In August 1999, Asset Investors, an affiliated real estate investment trust, made a bid for the 73 percent of Commercial Assets it didn’t already own by offering 0.4075 of one of its shares for each Commercial Assets share. Three Commercial Assets shareholders quickly filed suit in Chancery Court in Wilmington, arguing they weren’t getting enough for their stock. After negotiations with shareholders’ lawyers, the Denver-based companies agreed to allow Commercial Asset holders to get $5.75 per share rather than Asset Investors stock for their holdings. Asset Investors officials agreed to pay $20.4 million under the settlement’s cash option. The remaining shares exchanged in the transaction were valued at $32.7 million. Shareholders also won the right to vote on the buyout and to review proxy materials sent to investors prior to balloting under the settlement. Two weeks ago, 97 percent of Asset Investors’ and Commercial Assets’ shareholders voted to approve the buyout, the company said. Both companies specialize in investing in trailers and parks for recreational vehicles. Shareholders’ lawyers “achieved a substantial benefit” for their clients by challenging the buyout, Strine said in approving the settlement. Along with the attorneys fees, Strine also approved a $5,000 fee for lead plaintiff Jay Weinstein. Weinstein, who oversees a Baltimore-based investment fund, owns more than $100,000 in Commercial Asset stock. He was singled out for his work consulting with shareholders’ lawyers on the case. Shareholders were represented in the case by Norman Monhait of Wilmington’s Rosenthal Monhait Gross & Goddess. Commercial Asset’s directors and officers were represented by Charles F. Richards Jr., Srinivas M. Raju and Thad J. Bracegirdle of Wilmington’s Richards Layton & Finger. Commercial Assets and Asset Investors were represented by Edward P. Welch, Andrew J. Turezyn and Lorin M. Hochman of the Wilmington office of New York’s Skadden Arps Slate Meagher & Flom. The case was In Re Commercial Assets Inc. Shareholders Litigation, Consolidated CA No. 17402.

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