CORPO Flashcards
at least 2/3 of the OCS ALONE
PARDS
power to deny Pre-emptive rights
delegation of powers to Amend, repeal, adopt new by-laws
Removal of director/trustees
ratification of act of Disloyal director
ratification of a contract of Self-dealing directors
Attributes of corpo
- Is an artificial being with separate and distinct personality
- Is created by operation of law
- Has a right of succession
- Has the powers, attributes, and properties expressly authorized by law or incidental to its existence
4.
at least majority vote of BOD and vote of the stockholders representing at least 2/3 of the OCS
ADAM-LI3ES
Amendment of AOI
Dissolution of Corporation
Adoption of plan of distribution of assets of non-stock corpo.
sale, Lease, exchange, mortgage, pledge or disposal of all or substantially all of corporate assets
Increase or decrease of capital stock
Incur, create or increase bonded indebtedness
Investment of corporate funds in another corporation or business or for any other purpose other than primary purpose.
Extension of corporate term
Issuance of Stock dividends
Commencement of Corporate Existence
corporate existence and juridical personality commence from the date the SEC issues certificates of incorporation under its official seal.
At least majority votes of BOD ALONE
OVPshares
Elections of Officers’
Vacancies, in BOD if due to DRAD. (Death, resignation, abandonment, disqualifications of director)
Power to acquire own shares
at least majority vote of BOD and vote of stockholders representing at least majority of OCS
FAM
Fixing the issued price of no-par value shares if BOd/BOT are not authorized by the AOI and by-laws
Amendments or repeal of by-laws or adoption of new by-laws
Management contract
At least majority of OCS ALONE
FFAD
Fixing of compensation of Directors
Fixing the issued price for no-par value shares if BOD/BOT are not authorized by the AOI or by-laws
Adoption of by-laws
Elections of Directors/Trustees
Basic Rights of Stockholders and members
- Right to vote
- Right to inspect
- Right to dividends
- Pre-emptive rights
- Appraisal rights
Illegal vs Ultra Vires
Illegal contemplates the doing of an act which is contrary to LAMOPPPD and are, like similar transactions between individuals, void. They cannot serve as basis of a court action nor to acquire validity of performance, ratification or estoppel. Ultra vires, on the other hand, or those which are illegal or void ab initio, but are not merely within scope of the articles of incorporation, are merely voidable and may become binding and enforceable when ratified by its stockholders.
Illegal vs Ultra Vires
Illegal contemplates the doing of an act which is contrary to LAMOPPPD and are, like similar transactions between individuals, void. They cannot serve as basis of a court action nor to acquire validity of performance, ratification or estoppel. Ultra vires, on the other hand, or those which are illegal or void ab initio, but are not merely within scope of the articles of incorporation, are merely voidable and may cbecome binding and enforceable when ratified by its stockholders.
At least majority votes of BOD ALONE
OVPshares
Elections of Officers’
Vacancies, in BOD if due to DRAD. (Death, resignation, abandonment, disqualifications of director)
Power to acquire own shares
Concept of Ultra Vires
No corporation shall exercise corporate power other than those conferred by the RCC, or by its articles of incorporation, and except as necessary/incidental to the exercise of the powers conferred.
At least majority votes of BOD ALONE
OVPshares
Elections of Officers’
Vacancies, in BOD if due to DRAD. (Death, resignation, abandonment, disqualifications of director)
Power to acquire own shares
Non-use of corporate charter
If a corporation doesn’t organize or commence its business within 5 yrs from the date of its incorporation, its certificate of incorporation shall be deemed revoked as of the day following the end of the 5-yr period.
If a corpo. has commenced its business but subsequently becomes inoperative for a period at least 5 consecutive years, the SEC may after due notice and hearing place the corpo. under delinquent status. The corpo. will be given 2 years from the date which it was placed under delinquent status to resume operations and comply with all the requirements that the SEC shall prescribe.
Doctrine of Separate Personality
The law vests corporation with separate and distinct personality from those that represent the corporation.
Meaning, the liability of corporation is not liability of corporation’s officers, bods, stockholders/owners, and parents/subsidiary corporation.
General Corporate Powers
SPAABAR
- To Sue and be sued in its corporate name
- To have Perpetual existence, unless the articles of incorporation provides otherwise
- to Adopt and use corporate seals
- to Amend its articles of incorporation
- to adopt By-laws, not contrary to lamopp, and to Amend and Repeal the same.
SPECIFIC POWERS
- Power to increase/decrease capital stocks
- Power to create/increase bonded indebtedness
- Power of non-stock corporation to incur, create or increase bonded indebtedness
- Power to deny pre-emptive rights
- Power to sell/disposed all or substantially all of the corporation’s corporate assets.
- Power to acquire its own shares
- Power to invest corporate funds in another corporation.
- Power to Declare dividends
- Power to enter into management contract
Corporations not allowed to issue no-par value common shares
BLTBPIPO
Buildings and
Loans Association
Trust Companies
Banks
Public Utilities
Insurance Companies
Preneed Companies
Other Corporations authorized to obtain or access money from the public
Test to determine the nationality of corporation
- Incorporation test - nationality is determined by the state of incorporation regardless of the nationality of the stockholders.
- Domiciliary test - nationality is determined by the principal place of business of the corporation.
- Control test - nationality is determined by the controlling stockholders or members
- Grandfather rule - nationality is attributed to the percentage of equity in the corporation used in nationalized or partly nationalized areas.
Doctrine of Piercing the Veil of Corporate Fiction
Under this doctrine, the corporate existence may be disregarded where the entity is formed or used for non-legitimate purposes, such as to evade a just and due obligation, or to justify a wrong, to shield or perpetrate fraud or to carry out similar and inequitable considerations, other unjustifiable aims or intentions, in which case, the fiction will be disregarded and the individuals composing it and two corporations will be treated as identical.
Who are can be incorporate
/ any person
/ partnership
/ association, or
/ corporation
singly or jointly with others but no more than 15 in numbers, may organize a corporation for any lawful purpose or purposes.
Will the new rule apply to the existing corpo? (RCC)
Yes, the corporate with certificates of incorporation issued upon the effectivity of RCC, and which continue to exist, shall have perpetual existence, unless the corporation, upon a vote of its stockholders representing majority of its outstanding capital stock, notifies the SEC that it elects to retain its specific corporate term pursuant to its articles of incorporation.
What is corporation?
is an artificial being created by operation of law, having the right of succession, and the powers, attributes, and properties expressly authorized by law or incidents to its existence.
CORPORATE POWERS
- General powers
- Specific powers
- Ultra vires
- Trust fund doctrine
