Substantial Change in Corporate Structure

Question 1

Under the Revised Model Business Corporation Act a corporation that owns at least 90% of the outstanding shares of each class of stock

Answer 1

may merge the subsidiary into itself without shareholder approval from either the parent or the sub

Question 2

In order for a merger of two public corporations to happen what is required?

Answer 2

1) Formal plan of merger be prepared

2) Merger plan must be approved by a majority of the board of directors and stockholders of both companies

Question 3

The stockholders of both corporations

Answer 3

need to be given notice of the merger plan

Question 4

A corporation voluntarily dissolves when

Answer 4

it’s board of directors passes a resolution to dissolve and liquidate

Question 5

The resolution to dissolve/liquidate

Answer 5

must be ratified by a majority of stockholders votes

Question 6

After ratification what are the next steps

Answer 6

1) The corporation must file a certificate of dissolution
2) cease business
3) wind up affairs
4) publish notice of dissolution

Question 7

Under Consolidation

Answer 7

1) Two corporations become One new corp
2) Assets and liabilities are acquired by new corp
3) New corp is liable for the old corp’s obligations