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Simple English definitions for legal terms
dissenters' right
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A quick definition of dissenters' right:
Dissenters' Right: A legal right given to shareholders of a company who disagree with a major decision, such as a merger, to have their shares evaluated by a court and demand that the company buy back their shares at the evaluated value. This right is also known as the appraisal remedy, appraisal right, right of dissent and appraisal.
A more thorough explanation:
Dissenters' right is a legal term that refers to the right of corporate shareholders who oppose some extraordinary corporate action, such as a merger, to have their shares judicially appraised and to demand that the corporation buy back their shares at the appraised value. This is also known as the appraisal remedy.
For example, if a company decides to merge with another company, some shareholders may not agree with this decision. In such a case, those shareholders can exercise their dissenters' right and demand that the company buy back their shares at a fair price.
The dissenters' right is a way for shareholders to protect their interests and ensure that they are not forced to accept a decision that they do not agree with. It gives them the option to exit the company and receive a fair value for their shares.