A) According to the book, if Henry doesn’t agree with the transaction he doesn’t have to be a shareholder in the new Marble Meats Corporation (MMC) that is formed after the merger with Natural Farms. Shareholders Appraisal Rights mean that Henry has the right to be paid the fair value of the MMC shares he owed on the date of the transaction. The fair value of the shares is calculated as the value on the day before the date of the stockholder voting for the transaction. Getting paid the appraisal value is the only option available to Henry.
B) The combination of Marble Meats Corporation (MMC) and Natural Farms, Inc. is considered a merger. A merger is defined as the combination of two or more corporations. MMC will absorb Natural Farms. After the merger, Natural Farms will no longer exist as a business and MMC will be the surviving corporation. Once the merger, has happened MMC will be recognized as the only corporation. MMC will have all the rights, privileges, and power of both corporations. MMC will also become liable for all of Natural Farms debts and obligations.
E2-02
In my opinion, I think that Smith and Jones will prevail in a …show more content…
In this case, Sam made a decision as the director and majority shareholder of CIC to purchase the land from SCPI (another company he owns) at a $50,000 profit to SCPI and paying 10% interest on the $100,000 loan to CIC to buy the land. Clearly Sam, as owner of SCPI was going to benefit greatly from this transaction. This benefit of $50,000 and 10% interest on $100,000 was an expense for CIC and impacted the other shareholders. He made a decision that benefited him and cost the other shareholders. If Sam had the best interest of CIC in mind, wouldn’t he have bought the option for the land for CIC? Or at least sold the land to CIC for $50,000? Olivia, as a minority shareholder of CIC will likely
B) The combination of Marble Meats Corporation (MMC) and Natural Farms, Inc. is considered a merger. A merger is defined as the combination of two or more corporations. MMC will absorb Natural Farms. After the merger, Natural Farms will no longer exist as a business and MMC will be the surviving corporation. Once the merger, has happened MMC will be recognized as the only corporation. MMC will have all the rights, privileges, and power of both corporations. MMC will also become liable for all of Natural Farms debts and obligations.
E2-02
In my opinion, I think that Smith and Jones will prevail in a …show more content…
In this case, Sam made a decision as the director and majority shareholder of CIC to purchase the land from SCPI (another company he owns) at a $50,000 profit to SCPI and paying 10% interest on the $100,000 loan to CIC to buy the land. Clearly Sam, as owner of SCPI was going to benefit greatly from this transaction. This benefit of $50,000 and 10% interest on $100,000 was an expense for CIC and impacted the other shareholders. He made a decision that benefited him and cost the other shareholders. If Sam had the best interest of CIC in mind, wouldn’t he have bought the option for the land for CIC? Or at least sold the land to CIC for $50,000? Olivia, as a minority shareholder of CIC will likely