Merger refers to the situation where one of the constituent corporations remains in being and absorbs into itself the other constituent corporation. It refers to the case where no new corporation is created, but where one of the constituent corporations ceases to exist, being absorbed by the remaining corporation.
Generally, statutes authorizing the combination of corporations prescribe the steps by which consolidation or merger may be effected. The general procedure is that the constituent corporations make a contract setting forth the terms of the merger or consolidation, which is subsequently ratified by the requisite number of stockholders of each corporation.
Title: Illinois Checklist of Matters to Consider in Drafting a Merger Agreement Keywords: Illinois, merger agreement, checklist, matters, drafting, considerations, types 1. Introduction to the Illinois Checklist for Merger Agreements The Illinois Checklist for Matters to Consider in Drafting a Merger Agreement is a comprehensive guide designed to assist parties involved in corporate mergers within the state of Illinois. This checklist covers crucial matters that should be outlined and properly addressed in a merger agreement to ensure a smooth and legally sound transaction. 2. Key Components of the Illinois Checklist for Merger Agreements a. Confidentiality and Non-Disclosure: Reviewing and incorporating appropriate confidential information provisions to protect sensitive data during the negotiation stages. b. Definitive Agreements: Ensuring all necessary agreements, such as the merger agreement itself, voting agreements, employment agreements, or any other relevant documents, are clearly defined. c. Merger Structure and Transaction Details: Outlining the preferred merger structure, consideration, treatment of stock options, purchase price adjustments, and other transaction-specific details. d. Representations and Warranties: Listing all necessary representations and warranties to be made by both parties involved in the merger, addressing company operations, financials, compliance with laws, legal disputes, etc. e. Due Diligence: Detailed provisions for the scope of due diligence, access to records, and any limitations or exceptions. f. Regulatory Approval: Guidelines for obtaining necessary regulatory approvals, such as antitrust clearance or approval from specific government agencies. g. Closing Conditions and Covenants: Specifying conditions that must be met before closing the merger, including required consents, completion of necessary legal formalities, third-party approvals, and other relevant obligations. h. Termination Provisions: Outlining conditions under which either party can terminate the merger agreement, potential penalties, and the obligation to reimburse expenses. i. Indemnification and Limitation of Liability: Clearly defining parties' rights and obligations with regard to indemnification, allocating risks and limiting liability for breaches or misrepresentations. j. Post-Closing Matters: Addressing requirements such as post-closing adjustments, retention of records, and any ongoing obligations or commitments once the merger is complete. 3. Types of Illinois Checklist for Merger Agreements a. Checklist for Public Company Mergers: Focused on additional considerations, SEC regulations, shareholder approvals, proxy statements, and other specific requirements applicable to publicly traded companies. b. Checklist for Private Company Mergers: Catered to the needs of privately-held companies, encompassing aspects like shareholder agreements, employee matters, and exemptions from certain detailed reporting requirements. c. Checklist for Cross-Border Mergers: Tailored for mergers involving an Illinois-based company and a foreign entity, addressing international regulations, tax implications, cultural differences, and potential jurisdictional complexities. d. Checklist for Sector-Specific Mergers: Targeted checklists for mergers in specific industries, such as healthcare, technology, finance, or manufacturing, considering sector-specific regulations, permits, or licenses. Note: The types mentioned above are hypothetical, and the Illinois Checklist for Merger Agreements may not be explicitly categorized in this manner. However, the checklist can be customized based on the specific nature of the merger, industry, or legal requirements involved. It is crucial to consult with legal professionals experienced in Illinois corporate law to ensure that any merger agreement complies with applicable regulations and protects the interests of all parties involved.
