Practice question
At a valid auction, two bidders each offer the entire required amount. One seeks10 shares; the other seeks9.5 shares. Both bids otherwise satisfy all requirements. The auctioneer rejects the latter solely because fractions are categorically forbidden. What is correct?
- The fraction is expressly contemplated, and the smaller qualifying share quantity governs
- Whole-share status automatically beats every fractional bid
- The higher share quantity always wins
- Neither bid may cover the full amount
- A fraction automatically creates a new subscription
Legal references
- RA11232 Revised Corporation Code: https://lawphil.net/statutes/repacts/ra2019/ra_11232_2019.html Section67, especially corporate bid, treasury-share and notice provisions.
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