In a "C" Reorganization, the Assumption of Target Corporation's Liabilities

question 44

True/False

In a "C" reorganization, the assumption of target corporation's liabilities by the acquiring corporation can be ignored as long as boot in the form of cash or property does not exceed 20 percent of the fair market value of the assets transferred.

---

Definitions:

Dealer Market

A financial market mechanism wherein buyers and sellers of securities conduct transactions through dealers who buy and sell for their own account.

Primary Market

The segment of the capital market where new securities are issued and sold to initial buyers, typically involving underwriting processes.

Liquidation Market

A market where assets are sold quickly, often at a reduced price, to convert them into cash.

Corporate Charter

A legal document issued by a government agency that establishes a corporation and outlines its rights and obligations.