The Delaware Chancery Court has voided Frantz Manufacturing Co.`s issuance of 125,000 shares to its employee stock ownership plan in April, EAC Industries Inc. reported. EAC, based in Chicago, has claimed to own more than 50 percent of Frantz, of Sterling, Ill. Frantz said the stock issue, approved before EAC made its move to gain control, meant EAC actually owned only 42 percent of Frantz`s stock. However, EAC said the court confirmed that it is owner of a majority of Frantz`s stock outstanding, and that EAC`s chairman and chief executive, Peter B. Fritzsche, is a member of Frantz`s board. The court also validated the actions of EAC in amending Frantz`s bylaws, including the requirement of a unanimous vote of Frantz`s board to take any action, EAC said. Concerning the action, Fritzsche said: ”We now hope that we can proceed with our plan to negotiate a merger of Frantz and EAC and realize the benefits of this combination rather than continue in fruitless litigation.” Frantz management had no comment, but a spokesman said Frantz`s ”real case”
concerning the manner by which EAC acquired its stock position in Frantz is pending in U.S. District Court in Chicago. It goes to trial July 25, he said.
