Series 79 practice questionmediumSqueeze-Out Mergers and Appraisal Rights
In a squeeze-out merger subject to Delaware law, which standard governs the fairness of the transaction to minority shareholders?
- ABusiness judgment rule
- BEntire fairness✓ Correct answer
- CMarket price standard
- DBoard neutrality rule
Explanation
Why B — Entire fairness
Entire fairness applies in conflict transactions, assessing both price and process. Trap answers use less stringent standards not applicable to squeeze-outs.
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