Asked by Lindani Skhosana on May 27, 2024
Verified
Cloud Inc. merges with Data Corporation. Cloud, the surviving corporation, issues shares or pays fair consideration to
A) Cloud's shareholders.
B) Data's shareholders.
C) the state.
D) no one.
Fair Consideration
In the context of contracts, it refers to something of value that is exchanged between parties, which is considered reasonable and equitable.
Shares Issue
The process by which a company distributes new shares of stock to investors or the public for the first time.
- Acquire knowledge of the steps and permissions essential for corporate mergers and takeovers.
Verified Answer
EM
Edith MendezMay 27, 2024
Final Answer :
B
Explanation :
In a merger where one corporation (Cloud Inc.) is the surviving entity, it typically issues shares or pays fair consideration to the shareholders of the non-surviving corporation (Data Corporation) as compensation for their shares being absorbed into the surviving entity.
Learning Objectives
- Acquire knowledge of the steps and permissions essential for corporate mergers and takeovers.
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