An apartment cooperative will typically involved a corporation renting apartments to people who are also owners of stock in the corporation. The apartment complex is owned by the corporation.
Two basic documents are ordinarily involved in the transfer of a member's or stockholder's interest in a cooperative apartment corporation: (1) an agreement for the purchase and sale of the proprietary lease and the appurtenant membership or stock; and (2) the instrument of assignment.
The agreement of purchase and sale is similar in format to an agreement for the sale of real property. The seller agrees to assign all rights under the proprietary lease covering the unit, and to sell the membership or stock in the corporation. The seller also agrees to procure the consent of the corporation to the transfer if this is required in the proprietary lease. The purchaser agrees to pay the purchase price and to submit references to the corporation and otherwise cooperate in procuring its consent to the transfer, and also promises to execute an agreement in a form approved by the corporation by which the purchaser assumes and agrees to be bound by all covenants and conditions of the proprietary lease.
The instrument of assignment does not differ materially from an ordinary assignment of a lease of real property, except that the assignor's interest in the membership or stock in the corporation is assigned together with interests under the proprietary lease. Ordinarily, the assignor declares that there are no liens or other claims outstanding against the lease or the shares to be assigned, that there are no undischarged bankruptcy proceedings or unsatisfied judgments or tax liens outstanding against the assignor, and that the assignor has full right and authority to assign the lease and shares.
Consent payment corporate action refers to a financial event or process in which a corporation offers monetary compensation to its shareholders in exchange for their approval or consent to a specific corporate decision or action. It is a way for companies to engage with their shareholders and seek their agreement before executing crucial business changes. Consent payment corporate action plays a significant role in corporate governance as it ensures transparency and accountability within a company's decision-making process. By seeking approval from shareholders, companies demonstrate their commitment to involving key stakeholders in important business matters and fostering a sense of ownership among investors. There are several types of Consent payment corporate actions used by companies to gain shareholder consent: 1. Cash Consent Payment: In this type of corporate action, companies offer a cash payment to shareholders in exchange for their consent. The cash amount is typically based on a predetermined formula or percentage of the shareholder's ownership in the company. 2. Stock Consent Payment: Instead of cash, some corporations may offer additional shares or stock options to shareholders as a Consent payment. This type of corporate action allows shareholders to increase their ownership stake in the company while giving their consent to a proposed action or decision. 3. Preferred Dividend Payment: In certain instances, companies might offer preferred dividend payments to shareholders who provide their consent. This type of Consent payment entails issuing a higher dividend rate to shareholders who agree to a particular corporate action. 4. Coupon Rate Adjustment: Consent payment corporate actions can also involve adjusting the coupon rates on bonds or other debt instruments held by shareholders. The coupon rate may increase or decrease based on the level of consent received, providing an incentive for shareholders to support the proposed action. 5. Special Dividend: Some companies may issue a special dividend to shareholders who grant their consent. This type of consent payment is often reserved for significant corporate actions or decisions with substantial implications for the company and its shareholders. In conclusion, Consent payment corporate action involves offering financial incentives to shareholders in exchange for their agreement or consent to a specific corporate decision. It is an important aspect of corporate governance, allowing companies to involve shareholders in key business matters. Whether through cash, stock, preferred dividends, coupon rate adjustments, or special dividends, Consent payment corporate actions provide a means to secure shareholder approval while maintaining transparency and accountability within the company.
