Asked by April Thompson on Jun 30, 2024
Verified
Assuming Calvin and Daniella can exercise their appraisal rights in this situation, what must they do?
A) They must issue a statement demanding the merger be declared null and void.
B) They must issue a statement demanding the vote be re-cast.
C) They must issue a statement demanding adequate compensation for their shares.
D) They must file a demand with a court for fair market value for their shares.
E) They must file a notice with the Secretary of State objecting to the merger and demanding fair market value for their shares.
Appraisal Rights
The right of shareholders to have their shares appraised and to receive monetary compensation in lieu of accepting the terms of certain corporate actions, like mergers.
Shareholder Meeting
is a gathering of a company's shareholders, held to discuss the company's performance, elect the board of directors, and make other decisions affecting the company.
Adequate Compensation
Fair and reasonable payment or reimbursement for services, losses, or expenses incurred.
- Recognize the legal and practical implications of shareholder dissent in mergers and acquisitions.
Verified Answer
SP
Shilvi PatelJul 02, 2024
Final Answer :
C
Explanation :
In situations where shareholders disagree with a merger, they can exercise their appraisal rights, which typically involve demanding adequate compensation for their shares if they do not agree with the merger terms. This is a legal right in many jurisdictions that allows dissenting shareholders to receive payment of the fair market value of their shares if they do not wish to participate in the merger.
Learning Objectives
- Recognize the legal and practical implications of shareholder dissent in mergers and acquisitions.