The Appraisal Remedy

Question 1

what is the appraisal remedy

Answer 1

it is a remedy where dissenting s/h who do not approve of trigger events are given the right to opt out of the company by withdrawing the fair value of their shares

Question 2

what are the procedural requirements that the s/h must comply with

Answer 2

1. notify the company that he is going to object
2. attend meeting/ proxy
3. vote against transaction
4. company sends notice to dissenting s/h
5. s/h sends demand to company to pay fair value of the shares

Question 3

what does S115 (8) set out

Answer 3

A s/h is entitled to relief under S164 if he is

1. notified the company in advance of intention to oppose
2. was present at the meeting
3. voted against the resolution

Question 4

what does S164 state in terms of the demand

Answer 4

The s/h may demand that the company pay the fair value of the shares in instances where it adopted a resolution following a trigger event

Question 5

What is the company process for the appraisal remedy

Answer 5

1. sends written offer to pay fair value determined by the directors
2. s/h may decide to accept or reject
3. if s/h rejects - court judicial appraisal
4. s/h accepts - initial offer will be bound by court determination