Studied by 2 people
articles of incorporation
A corporation shall have perpetual existence unless its
__ provides otherwise.
vote of
its stockholders representing a majority of its outstanding capital stock,
Corporations with certificates of incorporation issued prior to the effectivity of this Code,
and which continue to exist, shall have perpetual existence, unless the corporation, upon a ___ notifies the Commission
that it elects to retain its specific corporate term pursuant to its articles of incorporation:
by amending the
articles of incorporation:
A corporate term for a specific period may be extended or shortened
three (3) years
prior to the original or subsequent expiry date(s)
That no extension may be made earlier than
original or subsequent expiry date(s).
such extension of the
corporate term shall take effect only on the day following
an electronic document,
The articles of incorporation and applications for amendments thereto may be filed with
the Commission in the form of in accordance with the Commission’s rules
and regulations on electronic filing.
majority vote of the board of directors or trustees and the vote or written assent of the stockholders representing at least two-thirds (2/3) of the outstanding capital stock
the appraisal right of dissenting stockholders
any provision or matter stated in the articles
of incorporation may be amended by
stock, without prejudice to the
vote or written assent of majority of the trustees and at least two-thirds (2/3) of
the members.
articles of incorporation of a nonstock corporation may be
amended by
within six (6) months from the date of filing
for a cause not attributable to the corporation.
amendments shall take effect upon their approval by the Commission or from the date
of filing with the said Commission if not acted upon
expressed powers
expressly authorized by the corporation code, other laws, and articles of incorporation
implied powers
necessary for the exercise of express powers
incidental powers
incidental to the existence of the corporation
partnership and joint venture
corporation can now enter?
yes, only foreign is now prohibited
can dc give political donations?
ultra vires acts
not within the express, inherent, implied powers of the corporation
eclessiastical corporation
for spiritual purposes
lay corporation
other than religious purposes
eleemosynary
for charitable purposes
valid law
attempt in good faith (colorable compliance)
use of corporate powers
minimum: submission of bylaws
requities for existence of de facto corporation
personally liable unless there is novation
liability of a promoter
venue of actions
registration of chattel mortgage of sale
validity of meetings of stockholders
principal office serves as?
perperual
50 years
corporation can now have _____ existence from ___ years
not earlier than 3 years
extension of corporate term can be made ____
1 to 15
number of incorporators
must be natural persons (may include partnership, associatiion, corporation - PAC)
of legal age (if natural person)
must own or subscribed with at least 1 share
qualifications of incorporators
not exceeding 15
may exceed 15
number of directors governing stock corporation
number of trustees in non-stock corporation
independent directors, at least 20%
corporations vested with public interest shall have ____ constituting at least ______ of such board
corporations under SRC
bank, quasi-banks
NSSLAs
pawnshops
corporations engaged in money service business
pre-need
trust
insurance
other corporations as determined by SEC
corporations vested with public interest
independent director in revised corporation code
free from any business or other relationship which could reasonably be perceived to materially interfere
labor performed or services rendered
previously incurred indebtedness
property, intangible, tangible actually received
actual cash paid
unrestricted retained earnings to stated capital
oustanding shares exchanged for stocks (reclassification or conversion)
amendment: shares of stocks in another corporation
consideration for stocks
La Pre Pit A, URE, O SEX
subscribed but not yet paid, excluding treasury shares
OS - ____ but not yet _____ excluding ____
(OSA)
ordinary - stock cert and articles of incorporation
close - stck cert, AoI, bylaws
restrictions and preferences should be stated in:
ordinary corpo:
close corpo:
name of treasurer elected by subscribers
no transfer clause with regards to minimum ownership
100% mass media, 70% advertising, the rest 60%
execution clause - names and signatories of incorporators
notarial acknowledgment
other matters inlcuded in the articles of incoporation
majority vote of the board of directors or trustees and the vote or written assent of the stockholders representing at least two-thirds (2/3) of the outstanding capital stock
vote or written assent of majority of the trustees and at least two-thirds (2/3) of the members.
Unless otherwise prescribed by this Code or by special law, and for legitimate purposes, any provision or matter stated in the articles of incorporation may be amended by a _______, without prejudice to the appraisal right of dissenting stockholders in accordance with the provisions of this Code.
The articles of incorporation of a nonstock corporation may be amended by the _______
6 months from date of filing
amendment of AoI
if the SEC did not act on the application within _____ from ______, the amended is deemed approved
board of directors
supreme authority in matter of management of regular or ordinary business
must own at least 1 share or nust be a member
majority of BOD need not to be a resident
qualification of a director or trustee
5 years
exceeding 6 years
corporation code
securities regulation code
fraudulent activities
foreign country
bylaws
disqualifications of a director or trustee
if within ___ prior to election or appointment, he was convicted of final judgment:
of an offense punishable by imprisonment for a period ____
violation of ___
violation of ___
liable for ____
by a _____
disqualification in ____
At all elections of directors or trustees, there must be present, either in person or through a representative authorized to act by written proxy, the owners of a majority of the outstanding capital stock, or if there be no capital stock, a majority of the members entitled to vote. When so authorized in the bylaws or by a majority of the board of directors, the stockholders or members may also vote through remote communication or in absentia: Provided, That the right to vote through such modes may be exercised in corporations vested with public interest, notwithstanding the absence of a provision in the bylaws of such corporations.
At all elections of ________ or ________, there must be present, either in person or through a representative authorized to act by written ________, the owners of a ________ of the outstanding ________ stock, or if there be no capital stock, a ________ of the members entitled to ________. When so authorized in the ________ or by a ________ of the board of ________, the ________ or members may also ________ through remote ________ or in ________: Provided, That the ________ to vote through such ________ may be exercised in corporations vested with ________ interest, notwithstanding the absence of a ________ in the ________ of such corporations.
30 days, not later than 60 days
In case of non holding, report should be made within _____ which shall include a new date not later than ____ from the scheduled date.
In stock corporations, stockholders entitled to vote shall have the right to vote the number of shares of stock standing in their own names in the stock books of the corporation at the time fixed in the bylaws or where the bylaws are silent, at the time of the election. The said stockholder may: (a) vote such number of shares for as many persons as there are directors to be elected; (b) cumulate said shares and give one (1) candidate as many votes as the number of directors to be elected multiplied by the number of the shares owned; or (c) distribute them on the same principle among as many candidates as may be seen fit: Provided, That the total number of votes cast shall not exceed the number of shares owned by the stockholders as shown in the books of the corporation multiplied by the whole number of directors to be elected: Provided, however, That no delinquent stock shall be voted. Unless otherwise provided in the articles of incorporation or in the bylaws, members of nonstock corporations may cast as many votes as there are trustees to be elected but may not cast more than one (1) vote for one (1) candidate. Nominees for directors or trustees receiving the highest number of votes shall be declared elected.
In stock corporations, stockholders entitled to vote shall have the right to vote the number of ________ of stock standing in their own names in the stock books of the corporation at the time fixed in the ________ or where the bylaws are ________, at the time of the ________. The said stockholder may: (a) vote such number of shares for as many ________ as there are directors to be ________; (b) cumulate said ________ and give one (1) ________ as many votes as the number of directors to be elected multiplied by the number of the ________ owned; or (c) distribute them on the same ________ among as many ________ as may be seen fit: Provided, That the total number of ________ cast shall not exceed the number of shares ________ by the stockholders as shown in the ________ of the corporation multiplied by the whole number of ________ to be elected: Provided, however, That no ________ stock shall be voted. Unless otherwise provided in the ________ of incorporation or in the ________, members of nonstock corporations may cast as many ________ as there are trustees to be ________ but may not cast more than one (1) vote for one (1) ________. Nominees for directors or trustees receiving the highest number of ________ shall be declared ________.
Any director or trustee of a corporation may be removed from office by a vote of the stockholders holding or representing at least two-thirds (2/3) of the outstanding capital stock, or in a nonstock corporation, by a vote of at least two-thirds (2/3) of the members entitled to vote.
Provided, That such removal shall take place either at a regular meeting of the corporation or at a special meeting called for the purpose.
In either case, after previous notice to stockholders or members of the corporation of the intention to propose such removal at the meeting.
A special meeting of the stockholders or members for the purpose of removing any director or trustee must be called by the secretary on order of the president, or upon written demand of the stockholders representing or holding at least a majority of the outstanding capital stock, or a majority of the members entitled to vote.
If there is no secretary, or if the secretary, despite demand, fails or refuses to call the special meeting or to give notice thereof, the stockholder or member of the corporation signing the demand may call for the meeting by directly addressing the stockholders or members.
Notice of the time and place of such meeting, as well as of the intention to propose such removal, must be given by publication or by written notice prescribed in this Code.
Removal may be with or without cause: Provided, That removal without cause may not be used to deprive minority stockholders or members of the right of representation to which they may be entitled under Section 23 of this Code.
The Commission shall, motu proprio or upon verified complaint, and after due notice and hearing, order the removal of a director or trustee elected despite the disqualification, or whose disqualification arose or is discovered subsequent to an election.
The removal of a disqualified director shall be without prejudice to other sanctions that the Commission may impose on the board of directors or trustees who, with knowledge of the disqualification, failed to remove such director or trustee.
REMOVAL OF BOD
Any director or trustee of a corporation may be removed from office by a vote of the stockholders holding or representing at least ________ of the outstanding capital stock, or in a nonstock corporation, by a vote of at least ________ of the members entitled to vote.
Provided, That such removal shall take place either at a ________ meeting of the corporation or at a ________ meeting called for the purpose.
In either case, after previous ________ to stockholders or members of the corporation of the intention to propose such ________ at the meeting.
A special meeting of the stockholders or members for the purpose of removing any director or trustee must be called by the ________ on order of the ________, or upon written demand of the stockholders representing or holding at least a ________ of the outstanding capital stock, or a ________ of the members entitled to vote.
If there is no ________, or if the secretary, despite ________, fails or refuses to call the special meeting or to give ________ thereof, the stockholder or member of the corporation signing the ________ may call for the meeting by directly addressing the ________ or ________.
Notice of the ________ and ________ of such meeting, as well as of the intention to propose such ________, must be given by ________ or by written notice prescribed in this Code.
Removal may be with or without ________: Provided, That removal without cause may not be used to deprive ________ stockholders or members of the right of ________ to which they may be entitled under Section 23 of this Code.
The Commission shall, motu proprio or upon verified ________, and after due notice and ________, order the removal of a director or trustee elected despite the ________, or whose disqualification arose or is ________ subsequent to an election.
The removal of a disqualified director shall be without ________ to other ________ that the Commission may impose on the board of directors or trustees who, with ________ of the disqualification, failed to ________ such director or trustee.
shareholders
directors if they constitute quorum
shareholders
Vacancy
removal
death, resignation, abandonment
increase in the number of directors
same day
no later than 45 days
same meeting
in case of removal, election is held ___ of the meeting authorizing the removal
in case of DRA, _____ from the time of vacancy
in a general or special meeting called for the purpose, or in ____
stockholders even if directors constitute a quorum since their capacity is before expiration only
who shall replace hold-over directors?
among officiers
uninanimous vote
remaining directors or trustees
within 3 days
emergency board is temporarily filled by _____ of the corporation by ____ vote of _____
notification to SEC shall be made ___
at least 2/3 of the outstanding capital stocks
self-dealing directors ratification
voidable, board of directors
self dealing officers general rule: ____ unless authorized by ____
voidable
presence
vote
2/3 of OCS
meeting
adverse interest
fair and reasonable
reasonableness
self-dealing directors:
GR: _____
XPN:
___ not required to constitute a quorum
____ not necessary
if 1 and 2 is absent, ratified by ____
Requirements
there must be ____
full disclosure of ____
contract is ____
if it owns all or substantially all, ____ shall be determined
valid
at least 20%
exceeding 20%
if one is substantial and the other is nominal, voidable on the part of the latter
interlocking directors
GR: ____
nominal
substantial
board of directors
three
executive commitee is appointed by the ____
not less than ___
special commitee
__ commitee can be created
filling the vacancy
amendment or repeal of bylaws
amendment or repeal of board of resolution
approval of action which SH’s approval is needed
distribution of cash and stock dividends
executive commitee cannot do the following
not entitled to compensation
XPN:
reasonable per diems
bylaws
upon majority vote of SH
if performing a function other than director
10% of net income before tax during the preceding year
general rule as to compensation of directors
XPN?
yearly compensation?
nonstock - shareholders
stock - board of directors
election of corporate officers is done by:
in nonstock?
in stock?
pres - director
treasurer - resident of PH
secretary - resident and citizen
officers must be:
pres
treasurer
secretary
compliance officer
officer required in a corporation vested with public interest
not civilly or criminally liable
gross negligence
watered stocks
personally or solidarily
law (BP22)
liability of officer
xpn:
assents to patently unlawful act, __ negligence, conflict of interest
consents in issuance of ____
agrees to hold himself ____
made by ___ to answer for his action
majority vote of all members regardless if present or not
ex: 15 members, 9 are present, required vote is 8
election of corporate officers requires?
certificate of stocks
document evidencing the interest of stockholder of a corporation
common stocks
founder’s shares
pro-rata division of profits but without any preference
may be limited because of ___
not exceeding 5 years, non-extendable
founder’s shares - with the exclusive right to vote and be voted for a period ____ it is ____
issued only with stated par value
preference must be in ABS
limitations of preferred stock
preferred stocks
they have the privilege of being paid dividends first
yes
are redeemable shares denied of voting right?
II AM SADD
increase, incur, create bonded indebtedness
increase or decrease capital stock
amend articles of incorporation
merger or consolidation
sale, lease, exchange, mortgage of all or substantially all of corporate property
amend and adopt bylaws
dissolution of the corporation
rights of preferred shares
par value
values are fixed in the articles of incorporation and certificate
minimum subscription or orginal price
articles of incorporation, board of directors, by shareholders
no par value shares may be fixed in the ____ by ___when authorized or if not, by ____
deemed fully paid
non-assessable
consideration is not less than 5
entire consideration constitutes capital so not available for dividends declaration
cannot be issued as preferred stocks
cannot be issued by BLTBIPO
buildings, loans, trust, banks, insurance, public utilities
limitations of no-par value shares
watered stocks
shares are issued less than par value
redeemable shares
subjet to redemption which may be optional or mandatory based on face or issued value plus premium
reedemable shares
not subject to availability of unrestricted retained earnings
treasury shares
issued and fully paid but subsequently reacquired
A pre-incorporation subscription is deemed irrevocable for at least __________ months from the date of the subscription.
A pre-incorporation subscription can be revoked if the incorporation does not materialize within __________ months from the date of subscription or any longer period stipulated in the subscription contract.
Pre-incorporation subscriptions become irrevocable __________ submission of the Articles of Incorporation (AOI) to the SEC.
If the incorporation fails to materialize within the stipulated period, the subscription __________ be revoked.
To revoke a pre-incorporation subscription within the irrevocable period, __________ must consent to the revocation.
6
6
after
can
all subscribers
subscription contract
Any contract for the acquisition of unissued stock in an existing corporation or a corporation still to be formed shall be deemed a subscription, notwithstanding the fact that the parties refer to it as a purchase or some other contract
post-incorporation subscriptions
are those made or executed after the formation or organization of the corporation
1. It must be signed by the president or vice-president and countersigned by the secretary or assistant secretary;
2. It must be sealed with the corporate seal, and
3. The entire value thereof (together with the interest or expenses, if any) should have been paid
Issuance of certificates of stock; requisites:
indivisible
Subscription to shares of stock are deemed ____ and no certificate of stock can be issued unless and until the full amount of his subscription including interest and expenses, if any is paid.
For the issuance of a certificate of stock;
If his shares are declared delinquent; or
When he exercises appraisal right.
Rights of a SUBSCRIBER: a subscriber, even if not yet fully paid, is entitled to exercise all the rights of a stockholder and the corresponding liability that attach thereunder, except:
30
Board of Directors (BOD)
A subscription to shares of stock becomes delinquent if no payment is made on the balance of all or any portion of the subscription within __________ days from the date or dates fixed in the contract of subscription, without the need of a call, or on the date specified by the __________ pursuant to a call
the stockholder thereof immediately loses the right to vote and be voted upon or represented in any stockholders meeting as well as all the rights pertaining to a stockholder
Effect of Delinquency: General Rule:
the right to receive dividends:
1. Cash dividend - shall first be applied to the unpaid balance on his subscription plus cost and expenses; while
2. Stock dividends - shall be withheld until his unpaid subscription is paid in full.
XPNS to delinquency
contract of subscription
Board of Directors (BOD)
board
collection
Unpaid subscriptions or any percentage thereof, together with interest if required by the by-laws or the contract of subscription, shall be paid either:
On the date or dates fixed in the __________;
On the date or dates specified by the __________ pursuant to a “call” declaring any or all unpaid portion thereof to be payable.
To enforce payment, the following remedies are available:
By __________ action; and
By a __________ case in court.
TRUE
Failure or refusal of the BOD to enforce or collect payment of unpaid subscription will not prevent the creditors or the receiver of the corporation to institute a court action to collect the unpaid portion thereof. (TRUE OR FALSE)
subscription
interest
advertisement
sale
shares
expenses
certificate
certificate
treasury
In a delinquency sale, the amount to be paid includes:
a. The balance due on each __________.
b. All accrued __________.
c. Costs of __________.
d. Expenses of __________.
Bids in a delinquency sale shall all be for the amount due above and shall differ only on the number of __________ that the bidders are willing to accept in exchange for the said amount.
The highest bidder in a delinquency sale is determined by the bid made for the __________ number of shares in exchange for the total amount due.
The effect of a delinquency sale is that the stock purchased shall be transferred to the purchaser in the books of the corporation and a __________ for such stock shall be issued in the purchaser’s favor.
Any remaining shares, if any, shall be credited to the delinquent stockholder, who shall also be entitled to the issuance of a __________ of stock covering those shares.
If there are no bidders at the public auction, the corporation may bid for the shares, and the total amount due shall be credited as __________ in the books of the corporation.
In this case, title to all the shares of stock covered by the subscription shall be vested in the corporation as __________ shares.
pre-emptive right
right is the shareholder’s right to subscribe to all issues or disposition of shares of any class in proportion to his present holdings, the purpose being to enable the shareholder to retain his proportionate control in the corporation and to retain his equity in the surplus
a. Shares to be issued to comply with the laws requiring stock offering or minimum stock ownership by the public;
b. Shares issued in good faith in exchange for property needed for corporate purposes;
c. Shares issued in payment for previously contracted debt;
d. In case the right is denied in the Articles of Incorporation;
XPN in pre-emptive right
maximum of 30 days
suspension of rights
old: less than 50k
assets or liabilities less than 600k
certifiction
section 75 (old)
section 74 (RCC)
signed by all incorporators
majority of the OCS or members
adoption of by laws
prior to incorporation
after incorporation
majority of OCS and members
delegation - 2/3 of OCS or members, revocation - majority of SH or members
amendment of by laws
regular or special meeting
BOD delegated and revocation
arbitration
no longer requires
AMENDMENTS: Section 46(d) of the RCC now includes “The modes by which a stockholder, member, director, or trustee may attend meetings and cast their vote.”
It likewise includes that an ___ agreement may be provided in the bylaws.
The submission of the amended by-laws _____ that it be filed with the SEC attached to the original articles of incorporation and original bylaws.
Not exceeding 1/10 of 1% of the aggregate price
Payment of filing fees is ____ at which securities are proposed to be offered
Within 45 days after date of filing
___SEC shall give order declaring registration statement effective or rejecting it
Securities Regulation Code
Aims to protect investing public
1/10 of 1% of the maximum aggregate price or issued value of the securities
Exemption Fee
Which has sold a class of its securities pursuant to registration
Listed for trading in an exchange
Need assets of what is 50 million pesos having 200 or more shareholders holding up these 100 shares of a class of its equity securities
Reporterial requirements shall apply to an issuer:
90 days
Obligation of such issuer to file report shall be terminate ___ after the notification to that SEC by the issuer that the number of its holders holding at least 100 shares reduce to less than 100
Date of annual stakeholders meeting
Date of annual members meeting
Anniversary date of the license of SEC license
All corporation shall file their general information sheet within ____ from
Stock
Nonstock
Foreign
Calendar year - last numerical digit
Coding schedule
Fiscal year
120 days
110 days (brOker)
105 days (list5d)
Filing of annual Financial statements
corporations using ___ depending on the_____ of their SEC registration or license number
however any corporation may file their AFS on or before the____
Corporations using ____
GR: ___ calendar days
XPN: broker dealers: ___ calendar days from end of fiscal year
Listed companies and public companies - ___ days from the end of FY
Note
Flashcard