BL2-CORP.STWORK.MCAR-401E
SEATWORK.MCAR. Books, Merger& Consolidation, Appraisal Right
Read or research to answer the following questions?
1. What is the Procedure For Merger Or Consolidation?
a. The stockholder must be a dissenting stockholder – he voted against the
proposed action (Sec. 81, RCCP);
b. The stockholder must make a written demand on the corporation within 30 days
after the vote is taken;
c. The price to be paid is the fair value of the share on the date before the vote
was taken.
d. If within sixty (60) days from the approval of the corporate action by the
stockholders, the withdrawing stockholder and the corporation cannot agree on
the fair value of the shares, it shall be determined and appraised by three (3)
disinterested persons, one of whom shall be named by the stockholder, another
by the corporation, and the third by the two (2) thus chosen. Majority vote from
the three appraisers shall become final.
e. Costs of appraisal shall be borne by the corporation, unless the fair value
ascertained by the appraisers is approximately the same as the price which the
corporation may have offered to pay the stockholder, in which case they shall
be borne by the stockholder. (Sec.84, RCCP)
f. No payment shall be made to any dissenting stockholder unless the corporation
has unrestricted retained earnings in its books to cover such payment: (Sec.81
RCCP)
g. Upon payment by the corporation of the agreed or awarded price, the
stockholder shall forthwith transfer the shares to the corporation.
h. The appraiser gives its final approval.
2. Who approves the Plan of Merger or Consolidation within the constituent
corporations?
- It shall be approved by the majority approved by majority vote of the board of
directors or Trustees of the concerned corporations at separate meetings,
and approved by 2/3 of the Outstanding Capital Stock (OCS) of stockholders
or members.
3. How is the Appraisal Right exercised and who gives its final approval?
- The Appraisal Right is exercised by:
1. The stockholder must be a dissenting stockholder – he voted against the
proposed action (Sec. 81, RCCP);
2. The stockholder must make a written demand on the corporation within
30 days after the vote is taken;
3. The price to be paid is the fair value of the share on the date before the
vote was taken.
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4. If within sixty (60) days from the approval of the corporate action by the
stockholders, the withdrawing stockholder and the corporation cannot
agree on the fair value of the shares, it shall be determined and
appraised by three (3) disinterested persons, one of whom shall be
named by the stockholder, another by the corporation, and the third by
the two (2) thus chosen. Majority vote from the three appraisers shall
become final.
5. Costs of appraisal shall be borne by the corporation, unless the fair value
ascertained by the appraisers is approximately the same as the price
which the corporation may have offered to pay the stockholder, in which
case they shall be borne by the stockholder. (Sec.84, RCCP)
6. No payment shall be made to any dissenting stockholder unless the
corporation has unrestricted retained earnings in its books to cover such
payment: (Sec.81 RCCP)
7. Upon payment by the corporation of the agreed or awarded price, the
stockholder shall forthwith transfer the shares to the corporation.
The appraiser gives its final approval.