[Gaming Merger] Calvin and Daniella each own 5% of GamePower, a video game design company. GamePower is seeking to merge with GameKing, and before a shareholder meeting, Calvin and Daniella email all other shareholders and corporate representatives about their disagreement with the proposed transaction. At the shareholder meeting, they vote against the merger with GameKing, but, 90% of the shareholders vote in favor of the merger. Calvin tells Daniella that it is not fair that they are forced to be part of GameKing. Daniella tells him they have no choice, so get used to it.
-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.

Question

Quizplus · Accepted Answer

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.

[Gaming Merger] Calvin and Daniella Each Own 5% of GamePower