Absorption-Type Split Agreement
A merger is a corporate reorganization in which two or more companies become a company. When an existing company becomes a surviving company, the merger is called a buyout merger and the other companies that merge are dissolved. When a newly created corporation becomes a surviving entity, the merger is called a founder-type merger and all the merging companies are dissolved. The two companies reached an agreement on the above-mentioned allocation with regard to the distribution of companies following sincere discussions based on an overall consideration of factors such as the performance status and future prospects of the business, which is to be separated from the company as part of the company splitting. The impact of Split Company on the company`s consolidated results of operations is not significant. Where common assets and services used by one of the parties to the business reorganization are required under the reorganization of the enterprise, it is typical for the parties to the reorganization of the enterprise to enter into transitional service contracts or other contractual agreements allowing one party to grant the right to use those common assets to the other party. and one party to provide certain services to the other party after the reorganization of the business comes into effect. According to the Companies Act, there is no particular difference between whether the transferred assets or the undertakings are permanent, except as regards the division of an undertaking (see question 11). However, when assets or operations of a follow-up company are transferred through a non-tax-qualified reorganization, tax law allows for the good-business or goodwill to be realized and recognized by the surviving company or newly created company. . .