State law or a bylaw of a corporation's charter that compels a bidder for the corporation's majority stock to pay at least the fair market price for the stock held by minority stockholders. This price is usually computed as a multiple of the target firm's price-to-earnings (P/E) ratio. The P/E ratio is based either on the target firm's historical earnings or from a combination of the firm's and its industry's P/E ratio. In some cases the fair price is fixed as a specific sum, or it may be stated as the maximum price paid by the bidder for any portion of the firm's ordinary stock. In a two-tier takeover attempt, this provision ensures that the stockholders who tender their stock in the second tier receive at least the same price as those who tendered their stock in the first tier. The fair price provision can be annulled by the target firm's board of directors upon a super-majority decision, usually requiring 95% of the voting rights.