Chapter 22 Self-test Questions

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. A scheme of reconstruction is available under which piece of legislation?

Part 26 of the Companies Act 2006 correct incorrect

Section 110 of the Insolvency Act 1986 correct incorrect

Part 28 of the Companies Act 1986 correct incorrect

The Takeover Code correct incorrect

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. A scheme of reconstruction is sanctioned by passing an ordinary resolution.

True correct incorrect

False correct incorrect

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. A three-stage process exists to implement a scheme of arrangement. Which one of the following is not one of these three stages?

Meetings of creditors and members are held to approve the scheme correct incorrect

An application to the court is made to sanction the scheme correct incorrect

A board resolution is tabled to determine if the company should enter into a scheme of arrangement correct incorrect

An application is made to the court to summon meetings of members and creditors affected by the scheme correct incorrect

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. Identify which of the following parties can apply to the court to summon meetings of members and creditors affected by a scheme of arrangement.

The company correct incorrect

The directors of the company correct incorrect

Any creditor of the company correct incorrect

The liquidator correct incorrect

The administrator correct incorrect

Any member of the company correct incorrect

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. In order to approve a scheme of arrangement, at least 75 per cent in value of persons present and voting must vote in favour of the scheme.

True correct incorrect

False correct incorrect

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. When does a scheme of arrangement become binding?

When it is approved by the relevant members and creditors correct incorrect

When it is sanctioned by the court correct incorrect

When a copy of the court order sanctioning the scheme is sent to Companies House correct incorrect

When the company has notified the members and creditors that the scheme has been sanctioned correct incorrect

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. Which one of the following is not a function of the Takeover Panel?

To provide rulings on the interpretation, application or effect of the Takeover Code correct incorrect

To provide directions to restrain breaches of the Takeover Code correct incorrect

To determine whether a takeover or merger constitutes a breach of competition law correct incorrect

To make rules giving effect to the Takeover Directive correct incorrect

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. The Takeover Code only applies to takeover bids in relation to listed companies?

True correct incorrect

False correct incorrect

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. What is the mandatory offer?

If a person acquires 90 per cent of a company's shares, he must offer to buy the remaining shares correct incorrect

If a person acquires 90 per cent of the company's shares, the remaining shareholders can compel that person to make an offer for their shares correct incorrect

If a person acquires shares that carry at least 30 per cent of the company's voting rights, that person must make an offer to any class of equity shares and holders of shares with voting rights correct incorrect

If a person acquires over 50 per cent of a company's shares, he must make a takeover bid correct incorrect

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. When will squeeze-out and sell-out rights be triggered?

When a person acquires at least 30 per cent of the voting rights in a company correct incorrect

When a person acquires at least 50 per cent of the voting rights in a company correct incorrect

When a person acquires a majority of the voting rights in a company correct incorrect

When a person acquires at least 90 per cent of the shares in question and those shares carry at least 90 per cent of the voting rights correct incorrect