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WorksheetsLaw - July 5
Total questions: 69
Worksheet time: 2hrs 16mins
only natural persons can form corporations
Old Law
New Law
natural persons who are licensed to practice a profession shall be
allowed to organize as a corporation unless otherwise not allowed.
True
False
Any person, partnership, association or corporation singly or jointly with others
but not more than 15 may organize a corporation for any lawful purpose or
purposes.
True
False
incorporators must be residents of the Philippines
Old Law
New Law
A corporation with a single shareholder is called
(a)
Each incorporator must own at least _ share of stock.
(a)
A corporation shall have (a) existence.
A corporation can decide not to have perpetual existence and can
place in the Articles that it will exist for a specific period. This is not allowed.
True
False
Old Law - maximum of __ years renewable for __ years periods.
(a)
is the sum total fixed in the Articles as the
amount paid in or to be paid in and is the total capital of the
company to be used to pursue its business.
(a)
is the total shares issued to stockholders, whether fully paid or partially paid, EXCEPT Treasury shares.
(a)
_____ _______ _____ minus ________ ______ = Outstanding Capital Stock
(a)
lists down all the contents that are required to be included in
the Articles of Incorporation.
Section 11
Section 12
Section 13
Section 14
Unless required by special laws, no minimum capital stock is required
for incorporation.
True
False
Old Law Vs. New Law
A. The 25% - 25% Rule is not required.
B. 25% of authorized capital stock must be subscribed and 25% of subscribed capital stock must be paid-up.
A. Old Law
B. New Law
A. New Law
B. Old Law
The maximum amount of authorized capital stock under the old law.
(a)
If the Subscribed Capital Stock is 25% of Authorized Capital Stock, what is the amount of SCS under the old law?
5M
2.5M
3M
3.5M
If the Paid-Up Capital Stock is 25% of Subscribed Capital Stock, what is the amount of PCS under the old law?
500K
525K
600K
625K
Articles should include the authorized capital stock, the number of
shares into which it is divided, the par value of each share, the names,
nationalities and residence addresses of the original incorporators, the
amount subscribed and paid-up by each.
READ ONLY
READ ONLY
The corporation’s capital stock is the same as the
corporation’s capital.
True
False
is a broader term and refers to all its assets used
for the conduct of its business.
(a)
The Articles may be amended provided they are in accordance with the
Revised Corporation Code and they are for a legitimate purpose.
Sections 15 and 16.
True
False
Amendments must be approved by TWO VOTES:
1. ________ vote of the board of directors or board of trustees and
2. Vote or written assent by the ____________ representing at least 2/3 of the outstanding capital stock. In case of nonstock corporations, at least 2/3 of the _______.
(a)
Means more than half. Divide the number by 2 then add 1.
(a)
A corporate name must be (a) from those already reserved or
registered for use by another corporation or if such name is already protected
by law or when its use is contrary to existing laws and regulations. Section 17.
A name is not distinguishable even it contains the word “company”,
“incorporated” or an abbreviation of such words.
True
False
Punctuations, articles, conjunctions, prepositions, spacing etc. make
the corporate name distinguishable.
True
False
The SEC will not allow the registration of a corporate name which is (a) identical
or deceptively or confusingly similar to that of an existing corporation or (b)
patently deceptive or (c) patently confusing.
JUST READ
BASAHIN U LANG ANTE
Identifies the organization and it uses it to do
business, do legal transactions, sue and be sued. It is a necessary element of its
existence.
(a)
refer to corporations based on their compliance with the
registration requirements.
Sections 11, 12 & 13
Sections 15, 16 & 17
Sections 18, 19 & 20
Sections 21, 22 & 23
is organized in full compliance with the Revised
Corporation Code - perfectly normal and 100% legal.
(a)
is one that exists as a matter of fact but there is a
defect in its incorporation.
(a)
To be a de facto corporation the following requisites
must be present:
(a) existence of a valid law that allows its formation;
(b) good faith compliance with all legal requirements;
(c) exercise of corporate powers by the de facto corporation
read onle
read onle
Only the _________ _______ has the power and authority to question the legal existence of a __ _____ corporation by a quo ________ proceeding.
(a)
De Jure vs. De Facto Corporation
A. as a matter of fact or effect
B. by right
A. De Jure
B. De Facto
A. De Facto
B. De Jure
All persons who assume to act as a corporation knowing it to be without
authority to do so shall be liable for all debts, liabilities and damages incurred or
arising as a result thereof.
(a)
When a corporation by estoppel is sued on any transaction entered into, it shall
not be allowed to use its lack of corporate personality as a defense. Section 20
True
False
You can run away from your obligations using your lack of legal capacity.
True
False
If a corporation does not formally organize and commence business
within 5 years from the date of its incorporation, its certificate of
incorporation shall be deemed revoked on the day following the 5 year
period.
(a)
If a corporation starts operations but later on becomes inoperative for a
period of at least 5 years, the SEC may after notice and hearing place
the company under delinquent status. A delinquent corporation shall
have 2 years to resume operations and comply with all requirements. If
it still does not resume operations (7 years total) the SEC will move to
revoke its Certificate of Incorporation. Section 21
(a)
grace period to operate for 2 years
(a)
2 steps involved in the Non-use of Corporate Charter
(a)
on its own without notice and hearing
(a)
shall exercise corporate powers, conduct all business and control all properties of the stock corporation.
(a)
Directors Vs. Trustees
A. term of 1 year
B. term of not exceeding 3 years
A. Directors
B. Trustees
A. Trustees
B. Directors
Each director/trustee shall hold office until a successor is elected and qualified.
(a)
shall exercise corporate powers, conduct all business and
control all properties of the non-stock corporation.
(a)
A trustee must continue to be a (a) while a trustee.
Duties of Directors/Trustees
(a)
Stock corporations vested with public interest are required to have independent directors constituting at least 20% of the board:
• Those covered by the Revised Securities Code
• Banks, quasi-banks, pawnshops, preneed, trust and insurance companies
• Others so declared by the SEC
Read Only
Read Only
is independent of management and is free from any business or other relationship which could, or could reasonably be perceived to materially interfere with the exercise of independent judgment in carrying out the responsibilities as a director.
(a)
has fiduciary duties to the corporation
(a)
This rule presumes that directors have acted in good faith and have sufficiently investigated the facts and circumstances surrounding an issue. A director must not be a rubber stamp of the corporation.
This rule applies to all directors, whether ordinary or independent.
(a)
Any stockholder or member shall have the right to nominate any director
or trustee who possesses all the qualifications and none of the
disqualifications in the Code.
True
False
Voting may be done through remote communications or in absentia
when allowed by the Bylaws. A stockholder or member who votes
through remote communications or in absentia shall be deemed
not present for purposes of quorum.
True
False
Vote are distributed equally among the candidates without
preference. MOST COMMON.
(a)
Concentrate said shares and give the votes to only one
candidate.
(a)
Distribute them on the same principle among as many candidates as
the stockholder wants.
(a)
A. One person to be both President and Secretary is allowed
B. One person to be both President and Treasurer is NOT allowed
C. One person to be both Secretary / Treasurer is not allowed
A. True
B. False
C. True
A. False
B. True
C. False
A. True
B. True
C. True
A. False
B. False
C. False
Two Kinds of Authority
(a)
The doctrine of _______ _________ provides that a corporation will be
estopped from denying an agent’s authority if it knowingly permits one of
its officers or any other agent to act within the scope of an apparent
authority and it holds him out to the public as possessing the power to do
those acts.
This concept is based on the principle of estoppel (prevent or preclude a party from denying)
(a)
Within (a) days after their election the secretary or any other officer of
the corporation shall submit to the SEC the names, nationalities,
shareholdings and residence addresses of the directors, trustees and officers.
If no elections were held, the company shall report to the SEC within __
days from the scheduled date of election why the elections were not
held and specify a new date for the election which shall not be later than __
days from the original date.
(a)
Should a director, trustee or officer die, resign or in any manner cease
to hold office, the secretary or the director, trustee or officer of the
corporation shall within _ days from knowledge thereof report in
writing such fact to the SEC.
(a)
Removal may be with or without cause provided that removal without
cause may not be used to deprive minority stockholders of the
right of representation.
True
False
Voting can be done either at a
(a)
Any vacancy occurring, other than by removal or by expiration of term, may
be filled (1) the vote of at least a majority of the remaining directors or
trustees if there is still a quorum or (2) if there is no quorum the vacancies
must be filled by the stockholders or members in a regular or special meeting
called for that purpose.
When the vacancy is due to term expiration, the election shall be held no later
than the day of such expiration at a meeting called for that purpose.
When the vacancy is due to removal, the election may be held on the same
day as the stockholder’s meeting authorizing the removal and this act must be
stated in the agenda and stockholder’s notice of the meeting.
JUST READ
Matagal ang time, basahin mo ante
A person shall be disqualified from being a director, trustee or officer of any corporation,
if within 5 years prior to election or appointment, the person was:
a. Convicted by final judgment
- of any offense punishable by imprisonment for a period exceeding 6 years;
- for violating the RCC and
- for violating the Securities Regulation Code (RA 8799)
b. Found administratively liable for any offense involving fraudulent acts
c. Found guilty by a foreign court or equivalent foreign regulatory authority for acts,
violations or misconduct similar to those enumerated in a and b above.
Basahin mo nalang ulit, wala ako maisip na tanong e
Mahaba time beh
The bylaws of a corporation may impose other disqualifications in addition to
those enumerated in Section 26, such as preventing the directors of
competitor corporations to be elected to its Board. An example of this is the?
(a)
