by TheBusinessProfessor | Feb 23, 2025 | Business Entities, Corporate Governance & Ownership
What is a Keepwell Agreement?Keep-well agreement refers to a legal contract initiated by a parent company to its subsidiary, for the purpose of maintaining financial backing and solvency, throughout the agreed period. A subsidiary refers to a company with fifty...
by TheBusinessProfessor | Feb 23, 2025 | Business Entities, Corporate Governance & Ownership
What is an Amalgamation?Amalgamation is a consolidation of two entities to form a single entity. When two small businesses or companies are combined to form one, amalgamation has occurred. This is a little different from merger and acquisition in which an entity is...
by TheBusinessProfessor | Feb 23, 2025 | Business Entities, Corporate Governance & Ownership
What is a Corporate Charter?A charter is a legal document authorized by a state to recognize the creation of a corporate business entity. Some states issue a Certificate of incorporation, rather than a charter. The charter generally bears the seal of the state of...
by TheBusinessProfessor | Feb 23, 2025 | Business Entities, Corporate Governance & Ownership
What is the Revlon Rule?When a hostile takeover is about to occur and is inevitable, a company’s board of directors makes a satisfactory effort to get the company the highest possible value they can get. This is known as the Revlon Rule. This rule is...
by TheBusinessProfessor | Feb 23, 2025 | Business Entities, Corporate Governance & Ownership
What is a Fat Man Strategy?A fat man strategy is a tactic used by a target company to foil or prevent a hostile takeover. When this strategy is used, the target company defends or protects itself by buying the assets of another company or acquiring the company. When...
by TheBusinessProfessor | Feb 23, 2025 | Business Entities, Corporate Governance & Ownership
What is a Holding Company?A holding company is a company that exists solely for owning assets or voting stock in other companies. This company does not engage in any production of goods and services or business operations but only focuses on owning assets of other...
