Finals Flashcards
Non-voting shares still entitled to vote
(DA2SI3M)
DISSOLUTION
AMENDMENT -AOI
AMENDMENT and adoption - bl
SLEMPO - all or substantially all property
INVESTMENT - corp funds (into another corp)
INCUR, create, increase - bonded indebtedness INCREASE/decrease - cap stock
MERGER and consolidation
2 INSTANCES WHEN CALL IS NOT NECESSARY
- TERMS OF SUBSCRIPTION AGREEMENT
payable not upon call but
a. Immediately
b. Specific day c.
In installment at specified dates
- INSOLVENCY
due and demandable
3 THEORIES BASIS for holding SH and officers liable for watered stocks
SUBSCRIPTION CONTRACT THEORY
unacceptable in our jurisdiction
FRAUD THEORY
TRUST FUND DOCTRINE
CONSIDERATIONS purchase of SOS
(APILAO)
ACTUAL CASH
PROPERTY
Tangible intangible Actually received
Necessary and convenient - use and lawful purpose
Fair value equal to par or issued value
INDEBTEDNESS
Previously incurred
LABOR
Actually rendered
AMOUNTS TRANSFERRED
Unrestricted retained earnings to stated capital
OUTSTANDING SHARES
exchange for stocks
Grounds for derivative suit
EXPRESS ALLEGATION
suit derivative in nature
NATURE OF RELIEFS PRAYED FOR
for the benefit of the corporation
a. Wastage or dissipation of corp funds
b. Violation of the laws
Procedure for involuntary dissolution
FILING of a verified complaint
PROPER NOTICE
HEARING
SEC RULES - instances for suspension/revocation of COR
- Failure to ORGANIZE AND COMMENCE
the tranx of business Within 2 years from the date of incorporation
- INOPERATIVE for a continuous period of at least 5 years
- Failed to FILE BY-laws within theprescribed period i.e. w/in 1 month from receipt of notice of issuance of COI
- Failed to FILE/REGISTER for a period of 5 years their Financial statements General information sheet Stock and transfer book
GROUNDS FOR INVOLUTARY DISSOLUTION
(CUSOBOI - FRG2)
CONTINUANCE
of business is not profitable or feasibele
upon recommendation and finding of SEC
ULTRA VIRES
or misuse of rights privileges and franchise
_SURRENDER - r_ights privileges and franchise
commission or ommission of acts amounting to such
OFFENDED
any provision of law
BY-LAWS
failure to file within prescribed period
ORGANIZE AND COMMENCE
business tranx within 2 years from issuance of COR
INOPERATIVE
continuous period of at least 5 years
FAILURE TO FILE
required reports
REFUSAL
or defiance to comply with a lawful order of the SEC
grave violation of its franchise
GUILTY - FRAUD
in procuring COR
GUILTY - SERIOUS MISREPRESENTATION
as to what the corp can do and is doing
to the prejudice or damage of the general public
REQUISITES FOR DERIVATIVE SUIT
(SECAN)
SHAREHOLDER
as of the time the act or tranx complained of
party bringing the action
EXHAUSTION
intra-corporate remedies
CAUSE OF ACTION
actually devolves on the corp
APPRAISAL RIGHT
not available
NOT NUISANCE or HARRASSMENT
CANNOT BE CLOSE-CORPORATIONS
(PIPE BOMS)
Corporations declared to be vested with PUBLIC INTEREST
INSURANCE Companies
PUBLIC UTILITY
EDUCATIONAL INSTITUTIONS
BANKS
OIL COMPANIES
MINING COMPANIES
STOCK EXCHANGES
REMEDIES AVAILABLE WHEN CORP REFUSES TO ISSUE CERT OF STOCK
- FILE SUIT - specific performance
- FILE ALTERNATIVE SUIT - damages
- MANDAMUS
- RESCIND - recover money that has been paid
MATTERS RECORDED IN THE STOCK AND TRANSFER BOOK
(AISO)
ALL STOCKS
in the names of SH
alphabetically arranged
INSTALLMENT
paid and inpaid
STATEMENT
alienation
sale
transfer
OTHERS
by laws provide
3 POLICIES IN SHARE CLASSIFICATION
1. FREEDOM AND POWER
2. PRESUMPTION OF EQUALITY
3. VOTING RIGHTS on matters it considers fundalmental measures (da2si3m)
PRIMARY DISTINCTION OF CLOSE CORPORATION
- IDENTITY OF STOCK OWNERSHIP
- ACTIVE MANAGEMENT
CLOSE CORPORATION
DEFINITION; PROVIDES IN THE AOI THE FF:
- all issued shares are held of record by a specified number of people not more than 20
- transfer all issued shares of all classes are subject to one or more restrictions (under Title XII)
- should NOT list any of its shares in the stocks exchange or make any public offering of its shares
***not a close corp if 2/3 of its voting shares or shares entitled to vote are owned or controlled by another corp not a close corp
REQUIREMENTS/PROCEDURES
LICENSE TO DO BUSINESS IN THE PHILIPPINES
- FILING A VERIFIED APPLICATION WITH THE SEC*
- REQUIRED DATA*
- CERTIFIED CONSULARIZED COPIES*
- CERTIFICATION OF RECIPROCITY*
- *************************************************************************
1. _Copy of AOI and B_L certified in accordance with law
translation to an official language
- application for license under oath
- attached: certification of reciprocity
- statement under oath of the president
corp is solvent as of the date not exceeding 1 year prior
- banking, financial and insurance - must comply with the provision of existing law applicable to them
e. g. favorable reccomendation
WHAT MUST BE SET FORTH IN THE APPLICATION FOR LICENSE TO DO BUSINESS IN THE PH
(DARPS - DA3O)
DATE AND TERM
of incorporation
ADDRESS
principal office in the country or state of incorporation
including street number
RESIDENT AGENT
name and address
PLACE IN THE PH
where it intends to operate
SPECIFIC PURPOSE OR PURPOSES
intends to pursue
DIRECTORS AND OFFICERS
names and addresses
present
AUTHORIZED CAPITAL STOCK
statement and the aggregate number of shares it is authorized to issue
AMOUNT ACTUALLY PAID
statement
ADDITIONAL INFORMATION
necessary to help SEC determine whether it should be issued license
OUTSTANDING CAPITAL STOCK
statement and the aggregate number of shares it has issued
GROUNDS FOR REVOCATION OF LICENSE
(Farcatiap - UMAO)
FAILURE
file its ANNUAL REPORT or pay any fee
appoint and maintain RESIDENT AGENT
submit statement of CHANGE of RA
submit AUTHENTICATED COPY of any AMENDMENT of its AOI/BL
pay TAXES, IMPOSTS, ASSESSMENT, PENALTIES
UNFIT to transact business
MISREPRESENTATION of any material matter
acts as AGENT OF or ACTING on behalf of another FOREIGN CORP not duly licensed to do business in PH
transact business OUTSIDE of the PURPOSE
INSTANCES WHERE APPRAISAL RIGHT IS AVAILABLE
(ATSIM)
1. AMENDMENT
of AOI or BL changing or restricting rights of any SH or class of shares or authorizing preferences
2.TERM
extend or shorten
3. SLEMPOT
all or substantially all of its assets or property
4. INVESTMENT
corp funds
into another corp
outside of its primary purpose
5. MERGER OR CONSOLIDATION
ACTS CONSTITUTION DOING BUSINESS
FIA 1991
(SAPO)
1. SOLICITING
orders
services contracts
opening offices - liaison or branches
2. APPOINTING
representatives
distributors
a. domiciled in PH
b. calendar year stay in the country for a period of 180 days or more
3.PARTICIPATING
management
supervision
control
of any domestic business or entity in the PH
4. OTHER ACT/(S)
implies a countinuity of commercial dealing or arrangements
business gain
ACTS NOT CONSTITUTING DOING BUSINESS
FIA 1991
(MAPS CCP)
1. MERE INVESTMENT
2. APPOINTING
representative or distributor in PH
doing business in its own name
3. PUBLICATION
general advertisment in any print or broadcast media
4. STOCK OF GOODS
maintains … in PH
solely for having the same processed by another entity in the PH
5. CONSIGNMENT
by FC
equipment
with local company for the processing of products for export
6. COLLECTING INFORMATION
7. PERFORMING
services auxilliary to an existing isolated contract NOT in a continuing basis
