Question 1

Assuming Calvin and Daniella properly exercise their appraisal rights,how is the value of their shares generally determined?

Accepted Answer

A)  By the value of the shares on the day the merger is finalized.
B)  By the value of the shares on the day of the shareholder vote.
C)  By the value of the shares of similarly sized corporations.
D)  By the value of the shares on the day before the shareholder vote.
E)  By the value of the shares on the day following the shareholder vote.F) None of the above
G) A) and C)

Question 2

Today,consolidations are very rare.

Accepted Answer

A) True 
 B)False

Question 3

Although an acquiring corporation can buy another corporation's voting shares,the acquiring corporation cannot buy all of another corporation's voting shares.

Accepted Answer

A) True 
 B)False

Question 4

According to the text,there are three circumstances under which a corporation acquiring assets assumes the liabilities of the selling corporation.Please list all three circumstances.

Accepted Answer

A corporation acquiring assets...

Question 5

In the text case,Hartleib v.Sirius Satellite Radio et al. ,shareholders of Sirius sued Sirius XM after a merger,claiming that Sirius executives decreased stock prices by entering into agreements with XM to the effect that both companies would refrain from looking at other merger deals.Which of the following was the result?

Accepted Answer

A)  That the plaintiffs' statements were sufficiently specific,that the complaint was filed in a timely manner,and that the plaintiff was entitled to damages as a matter of law.
B)  That the plaintiffs had no authority to proceed after the merger.
C)  That the plaintiffs' generalized statements failing to identify specific wrongful acts and coming after changes in board membership were insufficient.
D)  That the plaintiffs' statements,while generalized,were sufficient but that the plaintiff failed to file the complaint in a timely manner.
E)  That the plaintiffs' statements were sufficiently specific,that the complaint was filed in a timely manner,and that a trial would be conducted later.F) C) and D)
G) None of the above

Question 6

If a merger increases the number of the surviving corporation's shares by no more than ________ percent,most states do not require the approval of the surviving corporation's shareholders.

Accepted Answer

A)  5
B)  20
C)  30
D)  15
E)  10F) A) and D)
G) B) and D)

Question 7

Which of the following must a corporation do first when initiating voluntary dissolution procedures?

Accepted Answer

A)  The directors must resign.
B)  The officers must resign.
C)  The court must appoint a receiver.
D)  The directors must file articles of dissolution with the secretary of state.
E)  The directors must notify the local court with jurisdiction over any claims.F) A) and B)
G) B) and E)

Question 8

What key piece of information does an aggressor generally need in order to gain control of a target corporation through proxies?

Accepted Answer

A)  A list of target shareholders
B)  The balance sheet of the target
C)  The income statements of the target
D)  A list of members of the board of directors of the target
E)  A list of target officersF) B) and D)
G) A) and D)

Question 9

By offering to purchase the stock of Grassroots Corporation at a price above its current market value,Grow True Corporation made a[n] ________.

Accepted Answer

A)  Cash purchase offer
B)  Hostile offer
C)  Substantial offer
D)  Above market offer
E)  Tender offerF) D) and E)
G) A) and C)

Question 10

Takeovers to which the management of the target corporation objects are called hostile takeovers.

Accepted Answer

A) True 
 B)False

Question 11

If a dissenting shareholder exercises an appraisal right when a proposed merger is involved,which of the following is generally used to determine the value of stock?

Accepted Answer

A)  The value of shares on the day of the shareholder vote.
B)  The value of shares 10 days before the shareholder vote.
C)  The value of shares on the day the proposed merger was announced.
D)  The value of shares on the day after the shareholder vote.
E)  The value of shares on the day before the shareholder vote.F) A) and B)
G) C) and D)

Question 12

The surviving corporation's right to sue for debt and damages on behalf of the absorbed corporation is called which of the following?

Accepted Answer

A)  A chose in action
B)  A right of litigation
C)  A course of recovery
D)  A right of recovery
E)  An accord and satisfactionF) C) and D)
G) A) and E)

Question 13

Which of the following is true regarding state approval of consolidations?

Accepted Answer

A)  The secretary of state must approve consolidations so long as the corporate entity at issue has sufficient assets.
B)  The secretary of state must approve consolidations so long as no more than 10% of either company's shareholders object.
C)  After reviewing the plan to see that legal requirements are met,the secretary of state issues a certificate to grant approval.
D)  There is no requirement that the state approve consolidations.
E)  The secretary of state must approve consolidations so long as creditors of the corporate entity at issue do not remain unpaid.F) B) and C)
G) A) and B)

Question 14

[Gaming Merger] Calvin and Daniella each own 5% of GamePower,a video game design company.GamePower is seeking to merge with GameKing,and before a shareholder meeting,Calvin and Daniella email all other shareholders and corporate representatives about their disagreement with the proposed transaction.At the shareholder meeting,they vote against the merger with GameKing,but,90% of the shareholders vote in favor of the merger.Calvin tells Daniella that it is not fair that they are forced to be part of GameKing.Daniella tells him they have no choice,so get used to it.
-What,if any,option do Calvin and Daniella have if they do not want to be part of the merged corporation?

Accepted Answer

A)  As dissenting shareholders,they cannot overrule the majority's vote.
B)  They can exercise their appraisal rights and receive monetary compensation from the corporation for their value.
C)  Because 90% of the shareholders voted in favor of the merger,there are no other steps Calvin and Daniella can take.
D)  They have no options because the law does not protect shareholders from one another.
E)  They have no options because 90% of the shareholders voted in favor of the merger,thus,they cannot exercise their appraisal rights.F) A) and E)
G) A) and B)

Question 15

In a merger,which of the following is true regarding the property of the absorbed corporation?

Accepted Answer

A)  It must be held in trust for at least six months to satisfy claims of creditors.
B)  It must be placed within the jurisdiction of the secretary of state for at least one year in order to satisfy claims of creditors.
C)  It must be sold and distributed to the absorbed corporation's shareholders.
D)  It is obtained by the surviving corporation.
E)  It must be held in trust for at least one year to satisfy claims of creditors.F) C) and E)
G) B) and D)

Question 16

Which of the following is true regarding Tony's suggestion that dissolution be implemented quickly in order to avoid claims by creditors?

Accepted Answer

A)  Whether or not his suggestion will help depends on the corporation's articles of incorporation which set forth the time period during which creditors may file claims following dissolution.
B)  His suggestion was a good one only for debts outstanding for over 1 year;otherwise,the creditors have at least six months following dissolution in which to make claims.
C)  His suggestion was a good one because in that way,the claims could likely be avoided.
D)  His suggestion would not avoid claims because the law requires that creditors be allowed at least 120 days after dissolution in order to make a claim.
E)  Whether or not his suggestion will help depends on the corporation's bylaws which set forth the time period during which creditors may file claims following dissolution.F) B) and E)
G) B) and D)

Question 17

Is Jude correct that the proxies do not really matter?

Accepted Answer

A)  Yes,only shareholders have a right to vote at shareholder meetings.
B)  Yes,the proxies do not have a right to vote at shareholder meetings.
C)  Yes,proxies have no rights under the law.
D)  No,although only shareholders have a right to vote at shareholder meetings,the proxies can influence the shareholders.
E)  No,the holder of a proxy has the right to vote at shareholder meetings.F) All of the above
G) B) and C)

Question 18

To what does the term "going private" refer during a hostile takeover situation?

Accepted Answer

A)  A leveraged buyout
B)  A management buyout
C)  A closely managed buyout
D)  An approved buyout
E)  A corporate buyoutF) C) and E)
G) A) and B)

Question 19

[Green Trees] Keith,the president of Grow True Corporation,a company that provides landscaping services,wanted his corporation to purchase Grassroots Corporation,another corporation providing landscaping services.The board of Grassroots Corporation,however,did not wish to sell.The board of Grow True Corporation decided to buy any or all of Grassroots Corporation's stock in order to gain control of Grassroots Corporation.The management of Grassroots Corporation and its board strongly objected to the attempt by Grow True Corporation to take over the company.Grow True Corporation offered to purchase stock held by Grassroots shareholders at a price substantially above the current market value of the stock.When that strategy was not wholly successful,Grow True Corporation offered to give shareholders of Grassroots Corporation stock in Grow True Corporation in return for their Grassroots Corporation stock.
-Which of the following terms describes Grow True Corporation in its attempt to buy any or all of Grassroots Corporation's voting shares

Accepted Answer

A)  Incentive giver
B)  Pusher
C)  Demander
D)  Bully
E)  AggressorF) C) and E)
G) A) and B)

Question 20

In which of the following does an aggressor pay cash to target shareholders?

Accepted Answer

A)  Substantial tender offer
B)  Asset tender offer
C)  Cash tender offer
D)  Hostile tender offer
E)  Immediate tender offerF) C) and D)
G) B) and D)

Exam 40: Corporations: Mergers, consolidations, terminations

To what does the term "going private" refer during a hostile takeover situation?

Correct Answer
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Correct Answer
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If a dissenting shareholder exercises an appraisal right when a proposed merger is involved,which of the following is generally used to determine the value of stock?

Correct Answer
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Correct Answer
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What key piece of information does an aggressor generally need in order to gain control of a target corporation through proxies?

Correct Answer
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Although an acquiring corporation can buy another corporation's voting shares,the acquiring corporation cannot buy all of another corporation's voting shares.

Correct Answer
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Today,consolidations are very rare.

Correct Answer
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Assuming Calvin and Daniella properly exercise their appraisal rights,how is the value of their shares generally determined?

Correct Answer
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Is Jude correct that the proxies do not really matter?

Correct Answer
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In a merger,which of the following is true regarding the property of the absorbed corporation?

Correct Answer
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Which of the following is true regarding state approval of consolidations?

Correct Answer
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Which of the following is true regarding Tony's suggestion that dissolution be implemented quickly in order to avoid claims by creditors?

Correct Answer
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The surviving corporation's right to sue for debt and damages on behalf of the absorbed corporation is called which of the following?

Correct Answer
verified

If a merger increases the number of the surviving corporation's shares by no more than ________ percent,most states do not require the approval of the surviving corporation's shareholders.

Correct Answer
verified

Takeovers to which the management of the target corporation objects are called hostile takeovers.

Correct Answer
verified

Which of the following must a corporation do first when initiating voluntary dissolution procedures?

Correct Answer
verified

By offering to purchase the stock of Grassroots Corporation at a price above its current market value,Grow True Corporation made a[n] ________.

Correct Answer
verified

In which of the following does an aggressor pay cash to target shareholders?

Correct Answer
verified

According to the text,there are three circumstances under which a corporation acquiring assets assumes the liabilities of the selling corporation.Please list all three circumstances.

Correct Answer
verified
A corporation acquiring assets...
View Answer

Correct Answer
verified

Exam 40: Corporations: Mergers, consolidations, terminations

To what does the term "going private" refer during a hostile takeover situation?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

If a dissenting shareholder exercises an appraisal right when a proposed merger is involved,which of the following is generally used to determine the value of stock?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

What key piece of information does an aggressor generally need in order to gain control of a target corporation through proxies?

Correct AnswerverifiedShow Answer

Although an acquiring corporation can buy another corporation's voting shares,the acquiring corporation cannot buy all of another corporation's voting shares.

Correct AnswerverifiedShow Answer

Today,consolidations are very rare.

Correct AnswerverifiedShow Answer

Assuming Calvin and Daniella properly exercise their appraisal rights,how is the value of their shares generally determined?

Correct AnswerverifiedShow Answer

Is Jude correct that the proxies do not really matter?

Correct AnswerverifiedShow Answer

In a merger,which of the following is true regarding the property of the absorbed corporation?

Correct AnswerverifiedShow Answer

Which of the following is true regarding state approval of consolidations?

Correct AnswerverifiedShow Answer

Which of the following is true regarding Tony's suggestion that dissolution be implemented quickly in order to avoid claims by creditors?

Correct AnswerverifiedShow Answer

The surviving corporation's right to sue for debt and damages on behalf of the absorbed corporation is called which of the following?

Correct AnswerverifiedShow Answer

If a merger increases the number of the surviving corporation's shares by no more than ________ percent,most states do not require the approval of the surviving corporation's shareholders.

Correct AnswerverifiedShow Answer

Takeovers to which the management of the target corporation objects are called hostile takeovers.

Correct AnswerverifiedShow Answer

Which of the following must a corporation do first when initiating voluntary dissolution procedures?

Correct AnswerverifiedShow Answer

By offering to purchase the stock of Grassroots Corporation at a price above its current market value,Grow True Corporation made a[n] ________.

Correct AnswerverifiedShow Answer

In which of the following does an aggressor pay cash to target shareholders?

Correct AnswerverifiedShow Answer

According to the text,there are three circumstances under which a corporation acquiring assets assumes the liabilities of the selling corporation.Please list all three circumstances.

Correct AnswerverifiedA corporation acquiring assets...View AnswerShow Answer

Correct AnswerverifiedShow Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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A corporation acquiring assets...
View Answer

Correct Answer
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