Kentucky Section 262 of the Delaware General Corporation Law

• Category: Corporations - Mergers and Acquisitions
• State: Multi-State
• Control #: US-CC-12-829
• Format: Word; Rich Text

Description

This is a multi-state form covering the subject matter of the title. Kentucky Section 262 of the Delaware General Corporation Law, also known as the Appraisal Rights Statute, is a crucial provision that provides shareholders of Delaware corporations with the right to seek appraisal of their shares in certain transactions. This section is an important safeguard for shareholders, ensuring their fair treatment in cases where they disagree with a proposed merger or consolidation involving the corporation they have invested in. The primary purpose of Kentucky Section 262 is to protect minority shareholders who may have concerns about the value they will receive as a result of a proposed transaction. By exercising their appraisal rights, these shareholders have the opportunity to seek a judicial determination of the fair value of their shares, as opposed to accepting the terms of the transaction offered by the corporation. There are different types of transactions that may trigger the applicability of Kentucky Section 262. These include mergers, consolidations, or transfers of substantially all assets not made in the usual course of business. In such cases, dissenting shareholders who meet the statutory requirements have the right to demand appraisal of their shares. To exercise their appraisal rights, shareholders must follow a specific process outlined in the Delaware General Corporation Law. This typically involves sending a written notice prior to the shareholder vote on the proposed transaction, stating their intention to seek appraisal. After the transaction is approved, the dissenting shareholder must then file a petition with the Delaware Court of Chancery to initiate the appraisal proceedings. The Court of Chancery plays a vital role in determining the fair value of the dissenting shareholders' shares. It may consider all relevant factors, including the value of the corporation as a going concern and any market prices or other financial information available. The court has the authority to set the fair value independently of the negotiated transaction price. Kentucky Section 262 provides shareholders with an important protection mechanism to ensure that they receive fair value for their investment in Delaware corporations. This provision emphasizes the importance of shareholder rights and the need for transparency and fair dealings in corporate transactions. In summary, Kentucky Section 262 of the Delaware General Corporation Law grants shareholders in Delaware corporations the right to seek appraisal of their shares in certain transactions. It serves as a safeguard for minority shareholders, allowing them to challenge the fair value of their shares when they disagree with a proposed merger or consolidation. By exercising appraisal rights, dissenting shareholders can seek a judicial determination of the fair value of their shares, ensuring their equitable treatment in corporate transactions.

Kentucky Section 262 of the Delaware General Corporation Law, also known as the Appraisal Rights Statute, is a crucial provision that provides shareholders of Delaware corporations with the right to seek appraisal of their shares in certain transactions. This section is an important safeguard for shareholders, ensuring their fair treatment in cases where they disagree with a proposed merger or consolidation involving the corporation they have invested in. The primary purpose of Kentucky Section 262 is to protect minority shareholders who may have concerns about the value they will receive as a result of a proposed transaction. By exercising their appraisal rights, these shareholders have the opportunity to seek a judicial determination of the fair value of their shares, as opposed to accepting the terms of the transaction offered by the corporation. There are different types of transactions that may trigger the applicability of Kentucky Section 262. These include mergers, consolidations, or transfers of substantially all assets not made in the usual course of business. In such cases, dissenting shareholders who meet the statutory requirements have the right to demand appraisal of their shares. To exercise their appraisal rights, shareholders must follow a specific process outlined in the Delaware General Corporation Law. This typically involves sending a written notice prior to the shareholder vote on the proposed transaction, stating their intention to seek appraisal. After the transaction is approved, the dissenting shareholder must then file a petition with the Delaware Court of Chancery to initiate the appraisal proceedings. The Court of Chancery plays a vital role in determining the fair value of the dissenting shareholders' shares. It may consider all relevant factors, including the value of the corporation as a going concern and any market prices or other financial information available. The court has the authority to set the fair value independently of the negotiated transaction price. Kentucky Section 262 provides shareholders with an important protection mechanism to ensure that they receive fair value for their investment in Delaware corporations. This provision emphasizes the importance of shareholder rights and the need for transparency and fair dealings in corporate transactions. In summary, Kentucky Section 262 of the Delaware General Corporation Law grants shareholders in Delaware corporations the right to seek appraisal of their shares in certain transactions. It serves as a safeguard for minority shareholders, allowing them to challenge the fair value of their shares when they disagree with a proposed merger or consolidation. By exercising appraisal rights, dissenting shareholders can seek a judicial determination of the fair value of their shares, ensuring their equitable treatment in corporate transactions.