Sec 59 to 74 Flashcards
Requisites of a derivative suit
- The party bringing the suit is a shareholder as of the time of the act or transaction complained of
- He has tried to exhaust intra-corporate remedies
- The wrongdoing or harm have been, or being caused to the corporation and not to the particular stockholder bringing the suit
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
Subscription contract
Nature of subscription contract
Consensual contract and indivisible contract
A subscription for shares of stock of a corporation still to be formed
Pre-incorporation subscription
Rules for pre-incorporation subscription
- A pre-incorporation subscription is irrevocable for a period of at least 6 months from the date of subscription
- No pre-incorporation subscription may be revoked after the submission of the AOI to the SEC
Exceptions to the irrevocability of pre-incorporation subscription
- All of the other subscribers consent to the revocation
- The corporation fails to incorporate within the same period or within a longer period stipulated in the contract of subscription
A subscription entered into after the incorporation for the acquisition of unissued stock
Post-incorporation subscription
Stocks shall not be issued for
consideration less than par value or issued price thereof
Requisites for consideration consists of property
- It must be subject to fair valuation equal to the par or issued value of the stock issued
- The property is actually received by the corporation
- If it consists of intangible property, the valuation thereof shall initially be determined by the incorporators or of the BOD subject to the approval by the SEC
Requisites for the issuance of a stock certificate
- Signed by president or vice-president and countersigned by secretary or assistance sec, with seal of the corporation
- Delivery of the certificate
- The par value, must be fully paid
- The original certificate must be surrendered where the person requesting the issuance of a certificate is a transferee from another stockholder
(T or F) Any shares of stock with unpaid claims can still be transferred
False, No shares of stocks with unpaid claims be transferable in the books of the corporation
No certificate of stock shall be issued to a subscriber until
the full amount of the subscription together with the interest and expenses (in case of delinquent shares), if any is due, has been paid
A director or officer who consents for issuance of watered stocks, or having the knowledge of issuance but does not file a written objection with the corporate secretary shall be
liable to the corporation or its creditors, solidarily with the stockholder concerned for the difference between the value received at the time of issuance of the stock and the par or issued value of the same
Subscribers to stocks shall be liable to the corporation for ___________ on all unpaid subscriptions from the date of subscription, if so required by and at the rate fixed in the subscription contract
interest
If no rate of interest is fixed in the subscription contract, the ___________ shall apply
prevailing legal interest rate
Delinquent stock shall not be
voted for, be entitled to vote, or be represented at any stockholder’s meetings nor shall the holder thereof be entitled to any of the rights of the stockholder except for the right to dividends in accordance with the provisions of this code
Holders of subscribed shares but not fully paid which are not delinquent shall have
all the rights of a stockholder
All the books and records must be kept at the
principal office of the corporation
All the books and records must be kept at the principal office of the corporation except
the stock and transfer book may be kept in the principal office of the corporation or in the office of its stock and transfer agent, if any
A corporation shall furnish a stockholder or member, within _______ days from receipt of their written request, its most recent FS, in the form and substance of the financial reporting required by the commission
10 days
Limitations on the right of inspection
- The person demanding the right has not improperly used any information obtained through any previous examination of the books and records of the corporation
- The demand is made in good faith or for a legitimate purpose
- The person demanding the right is not a competitor, director, officer, controlling stockholder, or otherwise represents the interests of a competitor
