Title X – APPRAISAL RIGHT

1. I. The dissenting stockholder shall be entitled to receive payment of the fair value of his shares
as agreed upon between him and the corporation or as determined by the appraisers chosen by
them.

II. Payment may be made regardless if the corporation has unrestricted Retained earnings in its
books to cover the same.

a. Only I is true

b. Only II is true

C. Both are true

d. Both are false

2. The following are instances where a dissenting stockholder who Demands payment of his
shares is no longer allowed to withdraw from His decision, except:

A. The corporation consents to the withdrawal.

b. The proposed corporate action is approved by the SEC where its approval is necessary.

c. The proposed corporate action is abandoned or rescinded by the corporation.

d. The SEC determines that such stockholder is not entitled to appraisal right.

3. I. The corporation shall bear the costs of appraisal, as a rule.

II. Clearly, the right of appraisal may be exercised when there is a minor change in the charter or
articles of incorporation substantially prejudicing the rights of the stockholders.

a. Only I is true

b. Only II is true

c. Both are true

d. Both are false

4. Any stockholder of a corporation shall have the right to dissent and demand payment of the
fair value of his shares in the following instances, except:

a. In case any amendment to the articles of incorporation has effect of changing or restricting the
rights of any stockholder or class of shares, or of authorizing preferences in any respect superior
to those of outstanding shares of any class, or of extending or shortening the term of corporate
existence.

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 b. In case of sale, lease, exchange, transfer, mortgage, pledge o disposition of all or substantially
all of the corporate property and or other assets.

c. In case of increase or decrease of capital stock.

d. In case of merger or consolidation.

5. The following are the instances of appraisal right, except:

a. In case of investing of corporate funds in another corporation or

b. In case of sale, lease, exchange, transfer, mortgage, pledge or other disposition of all or
substantially all of the corporate property and business assets.

c. In case of merger or consolidation.

d. In case any amendment to the articles of incorporation.

6. I. In a close corporation, any stockholder of a close corporation may, for any reason, compel
the said corporation to purchase his shares at their fair value, which shall not be less than their
par or issued value, when the corporation has sufficient assets in its books to cover its debts and
liabilities exclusive of capital stock.

II. The appraisal right may be exercised by any stockholder who shall have voted against the
proposed corporate action, by making a written demand on the corporation within 30 days after
the date on which the vote was taken for payment of the fair value of his shares.

a. Only I is true

b. Only II is true

c. Both are true

d. Both are false

7. I. If within a period of 60 days from the date the corporate action was approved by the
stockholders, the withdrawing stockholder and the corporation cannot agree on the fair value of
the shares, it shall be determined and appraised by 5 disinterested persons.

II. That no payment shall be made to any dissenting stockholder unless the corporation has
unrestricted retained earnings in its books to cover such payment.

a. Only I is true

b. Only II is true

c. Both are true

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 d. Both are false

8. The effects of transfer of dissenting shares are the following:

I. The rights of the transferor as a dissenting stockholder shall cease and the transferee shall have
all the rights of a regular stockholder.

II. All dividend distributions which would have accrued on such shares shall be paid to the
transferee.

a. Only I is true

b. Only II is true

c. Both are true

d. Both are false

9. I. From the time of demand for payment of the fair value of a stockholder's shares until either
the abandonment of the corporate action involved or the purchase of the said shares by the
corporation, all rights accruing to such shares, including voting and dividend rights, shall be
suspended.

II. If the dissenting stockholder is not paid the value of his shares within 10 days after the award,
his voting and dividend rights shall immediately be restored.

a. Only I is true

b. Only II is true

c. Both are true

d. Both are false

10. It means that a stockholder who dissented and voted against the proposed corporate action,
may choose to get out of the corporation by demanding payment of the fair market value of his
shares.

a. Pre-emptive right

b. Voting right

c. Appraisal right

d. Management right

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