Schrödinger’s Cat And Merging Into A Foreign Corporation – Corporate/Commercial Law

Allen Matkins Leak Gamble Mallory & Natsis LLP

United States:

Schrödinger’s cat and merger into a foreign company

June 10, 2021

Allen Matkins Leak Gamble Mallory & Natsis LLP

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If a California corporation is merged with a foreign corporation, the merger will take effect in accordance with the law of the jurisdiction in which the surviving corporation was incorporated. In California, the merger will take effect for the California Vanishing Company at the effective date in the foreign jurisdiction upon filing the required filing with the California Secretary of State. Cal.no. Corp. Code Section 1108. For example, if a California corporation merges with a Delaware corporation and the Delaware merger takes effect on January 1, the California merger will take effect on January 1, upon filing the required California filing.

However, there is an exception to this rule if the California filing date is more than six months after the date of effectiveness in the foreign jurisdiction (or if the powers of the California company are suspended at the time of effectiveness in the foreign jurisdiction). Jurisdiction) the merger will take effect for the California Vanishing Company on the day of filing in California. Cal.no. Corp. Code § 1108 (e). Thus, if a California corporation merges into a Delaware corporation and the Delaware merger takes effect on January 1, but no filing is made in California by July 15, the California merger will not take effect until July 15.

This creates a curiosity that is reminiscent of Schrödinger’s famous cat. For example, let’s say it’s February 1st and a California company merged with a Delaware corporation effective January 1st, but no application has been filed in California. As of February 1st, there is no telling whether the California corporation exists. If the required California filing occurs within six months of the Delaware taking effect, it will not exist on February 1st. However, if the filing occurs more than six months after the Delaware became effective, it will continue to exist in California.

A company that was and is

For those who do not know Schrödinger’s cat, this is a reference to a famous thought experiment by the Austrian physicist Erwin Schrödinger from 1935. The experiment is a hypothetical cat in a box with a poison bottle, a radioactive source, a hammer and a Geiger counter. When the atomic particle from the source disintegrates, the Geiger counter detects the emission, triggers the hammer, which breaks the vial and kills the cat. The problem is that in quantum mechanics it is assumed that particles exist in all possible states (so-called quantum assumption), so that paradoxically they decay and not decay at the same time. This means that the cat is dead and alive at the same time, and an observer will not recognize the cat’s condition until the box is opened.

The content of this article is intended to provide general guidance on the subject. Expert advice should be sought regarding your specific circumstances.

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