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Exam 35: Corporate Mergers, Takeovers, and Termination

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Question 31

True/False

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When a corporation is dissolved voluntarily, its assets can be liquidated without notice to its creditors.

A) True
B) False

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Question 32

Multiple Choice

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Enchilada Inc. seeks to purchase a substantial number of the voting shares of Fajita Inc. Enchilada deals directly with the shareholders of Fajita. Enchilada offers a price higher than the market price of Fajita's shares. This is

A) a poison pill.
B) a tender offer.
C) a self-tender.
D) a breach of the business judgment rule.

E) C) and D)
F) All of the above

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Question 33

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Dissolution of a corporation can be brought about by

A court cannot dissolve a corporation for failure to commence business operations.

Bus Corporation exchanges some of its shares for some of the shares of Car Company. The exchange is used to create Drive Inc., whose business activity is to hold the shares of the two companies. Once the formalities are satisfied, a certificate of the exchange is issued by

Merger and consolidation refer to two legally distinct proceedings, but consolidation is also used to refer to all types of corporate combinations.

Avery wants to go into business as Boom! to make and market fireworks. When deciding which form of business organization would be most appropriate, Avery would normally take into account all of the following except

Shareholders are not required to vote to approve a plan of merger.

Market Company exchanges some of its shares for some of the shares of Niche Corporation. On the exchange of shares between Market and Niche

A short-form merger can be accomplished only with the approval of the shareholders.

Kudos Corporation combines its assets and liabilities with those of Livestream Company to form MedOnline Inc. Kudos and Livestream cease to exist. The agreement between Kudos and Livestream that sets out the capital structure and other features of MedOnline

Before a vote is taken on a proposed combination, the shareholders must be given sufficient information to evaluate the deal.

Lipstick Inc. merges with Mascara Inc. Only Mascara remains. The articles of merger

Doris wants to form a new firm-eBeats-to market a new app. Fees are required to form all of the following business organizations except

Dissolution of a corporation can be brought about by an agreement between the shareholders and the board of directors.

During the liquidation process, corporate assets are converted into cash.

A takeover is the acquisition of control over a corporation through a purchase of substantially all of its assets.

A share exchange can be used to create a holding company.

Beef Inc. merges with Chicken Corporation. Beef absorbs Chicken. After the merger, the surviving corporation is

Appraisal rights do not normally apply to short-form mergers.