Question 1

Salt Corporation wants to acquire or merge with Pepper Corporation.Salt should

Accepted Answer

In order for Salt Corporation to acquire or merge with Pepper Corporation, they would need to make a tender offer to the shareholders of Pepper. This allows the shareholders to choose whether or not to sell their shares and become part of the merger or acquisition. Filing a plan of merger with the secretary of state or filing an article of merger with Pepper would be necessary steps in the process, but they would not be the initial action that Salt Corporation should take. Making a tender offer to the shareholders of Salt would also not be necessary in this scenario.

Question 2

Brock is a shareholder of Competent Homebuilders Corporation (CHC).For the last few years,business has not been profitable for CHC.The firm has lost money on its operations.There has been some profit through sales of company assets,but the board of directors has refused to declare a dividend.This last year,the firm's accountants failed to file fed?eral in?come tax returns and the board refused to pay the tax.Brock takes a close look at the firm and protests to the board,in particular over the fail?ure to declare a dividend,but the board ignores the complaint.Which of these events,if any,would form a ground for a court to order the dissolu?tion of CHC,on Brock's petition? If the court denies the petition,could Brock and the other shareholders dissolve CHC?

Accepted Answer

The answer of Brock is a shareholder of Competent Homebuilders...

Question 3

Starr Cardio,Inc.,is a small business.Ted,Uma,and eleven other members of the Starr family own all of its stock.Currently,Starr's income is taxed at the corporate level and,after being distributed to the family members,at the shareholder level.Can Starr retain its corporate status but oth?er?wise avoid this double taxation? If so,how?

Accepted Answer

The answer of Starr Cardio,Inc.,is a small business.Ted,Uma,and eleven other...

Question 4

Precise Device Corporation and Quality Instruments,Inc.,decide to merge.This corporate combination does not require the approval of

Accepted Answer

The answer of Precise Device Corporation and Quality Instruments,Inc.,decide to...

Question 5

Realty Credit Company and Second Mortgage Corporation plan to con?solidate.Most likely,the articles of consolidation will be filed with

Accepted Answer

The articles of consolidation are required to be filed with the state's secretary of state as per the state laws.

Question 6

Jen files a suit against Kopper Kettle Company.While the suit is pending,Kopper Kettle merges with Luminous Pans,Inc.,with Luminous absorbing Kopper Kettle.Now,liability in the suit,if any,rests with

Accepted Answer

Since Luminous has absorbed Kopper Kettle, it also absorbs Kopper Kettle's liabilities, including the pending lawsuit filed by Jen. Therefore, liability in the suit now rests with Luminous.

Question 7

Giant Lift Corporation purchases all of the assets of Heavy Hydraulics Corporation.With respect to Heavy Hydraulics's liabilities,Giant Lift is

Accepted Answer

Giant Lift is only responsible for the liabilities of Heavy Hydraulics if the sale is actually a merger or consolidation. If it is a simple asset purchase, Giant Lift is not automatically responsible for Heavy Hydraulics's liabilities. However, if the transaction is structured as a merger or consolidation, Giant Lift may assume responsibility for these liabilities.

Question 8

Sangfroid Business Corporation can be compelled to dissolve by

Accepted Answer

Sangfroid Business Corporation can be compelled to dissolve by itself, through its shareholders and directors, or the state. This means that the corporation can voluntarily decide to dissolve, or the shareholders and directors can vote to dissolve the corporation. Additionally, the state can compel the corporation to dissolve for various reasons, such as failure to pay taxes or violating state regulations. Creditors alone do not have the power to compel a corporation to dissolve.

Question 9

Ruff Games,Inc.,wishes to ac?quire a controlling interest in Smart Toy Com?pany by buying its stock.Smart Toy is

Accepted Answer

Smart Toy Company is the corporation that Ruff Games, Inc. wishes to acquire, making it the target corporation.

Question 10

Corporate Properties,Inc.,attempts to acquire a substantial number of the shares of Downtown Realty Corporation through a public offer to Downtown's shareholders.This is

Accepted Answer

A tender offer is a public offer to buy a substantial number of shares of a company directly from its shareholders. This is different from a consolidation, which involves a merging of two companies into one entity, a short-form merger which is a statutory merger that can occur without the approval of all shareholders, and a termination, which is the ending of a business or contract.

Question 11

Mall Stores Corporation owns 95 percent of the shares of Niche Retail Corporation.Mall Stores combines with Niche Retail,but only Mall Stores continues to exist.This transaction was

Accepted Answer

A short-form merger occurs when a parent company owns at least 90 percent of the subsidiary's shares and merges the subsidiary into itself, resulting in the subsidiary's dissolution. In this scenario, Mall Stores owns 95 percent of Niche Retail's shares and only Mall Stores continues to exist after the combination, making it a short-form merger. Consolidation involves the formation of a new company by combining two or more companies, while a tender offer is an offer made by an acquiring company to purchase shares of a target company's stock from its shareholders. Termination refers to the ending of a contractual relationship or agreement.

Question 12

Raven is a shareholder of Quantum Mechanix Corporation.Raven could normally ex?er?cise appraisal rights if Quantum participated in

Accepted Answer

The answer of Raven is a shareholder of Quantum Mechanix...

Quiz 30: Formation and Termination of a Corporation