Which statement best describes the true basis for payment to dissenting shareholders?

Which statement best describes the true basis for payment to dissenting shareholders?

• A. The day of the vote
• B. The day prior to the vote, the fair value basis
• C. The surrender date
• D. The date of the corporate action

Answer: (D)

In dissenters’ rights, the amount paid to a shareholder who dissents is determined as of the date the corporate action takes effect. That is the moment the transaction terms become fixed and ownership changes hands, so the value used for payment is anchored to the date the corporate action occurs. The vote itself sets whether the action proceeds, but it does not set the payment basis. The surrender date comes later, when the shareholder actually exchanges shares for payment, so it isn’t the moment used to fix the value. Therefore, the payment basis is the date of the corporate action.

In dissenters’ rights, the amount paid to a shareholder who dissents is determined as of the date the corporate action takes effect. That is the moment the transaction terms become fixed and ownership changes hands, so the value used for payment is anchored to the date the corporate action occurs. The vote itself sets whether the action proceeds, but it does not set the payment basis. The surrender date comes later, when the shareholder actually exchanges shares for payment, so it isn’t the moment used to fix the value. Therefore, the payment basis is the date of the corporate action.