What Is the Difference Between the Procedures Governing Mergers and Consolidations

question 68

Multiple Choice

What is the difference between the procedures governing mergers and consolidations?

• A) With consolidation, the plan need not be submitted to the secretary of state.
• B) With consolidation, only the board of directors of both involved corporations must approve the plan; with merger, the shareholders of both involved corporations must also approve the plan.
• C) Unlike merger, with consolidation, no approval certificate is necessary.
• D) Unlike consolidation, with merger, the shareholders must approve the plan before it goes to the board of directors.
• E) The procedures governing mergers and consolidations are the same.

---

Definitions:

Par Value

The nominal or face value of a bond, stock, or coupon as stated in the financial instrument, which is a significant figure for calculating interest payments or dividends.

Par Value

The nominal or face value of a stock or bond as stated by the issuing company, often used in the context of bonds.

Preferred Stock

A class of ownership in a corporation with a specified dividend that must be paid before dividends to common stockholders.

Shares

Shares represent units of ownership interest in a corporation or financial asset, allowing shareholders to potentially participate in the profits and decision-making of the company.