BL2 R.
A 11232 Revised Corporation Code of The Philippines
Midterm Reviewer (TOS Based)
TITLE I.
Definitions;
Corporation
o Artificial being
o Created by Operation of Law
o Has right of succession and the powers, attributes, properties
Expressly authorized by law or Incidental to its existence
Classifications of Corporation (Classes);
Stock Corporations
o Are those which have capital stock divided into shares
o Are authorized to distribute to the holders dividends, or allotments of surplus profits.
Based on number of shares held
Non-Stock Corporation
o All other corporation other than stock corporation
Those Created by Special Laws;
Be governed by the provision of the special law or charter creating them
Supplemented by provisions of this code
Classification of Shares;
Class of share, rights, privileges, or restrictions, and stated par value
o Must be indicated in the AOI
Each share shall be EQUAL in all respect
o Unless otherwise provided in AOI
Condition; There shall always be shares that have voting rights
Shares may or may not have par value.
o Shares issued, no par value deemed fully paid and nonassessable holder not be liable to
corporation to creditors (limited liability)
Entire consideration considered as legal capital, therefore not available for
distribution of dividends
No par value shares, Can’t be issued below P5.00 per share
Corp. authorized to access funds from public not be permitted to issue no par-value shares
Types of Shares;
Common Shares
o Has voting rights
o Dividends are distributed after preferred shareholders are given
As well as distribution of assets, in case of Liquidation
Preference Shares
o No Voting rights
o Has preference in dividend and asset distribution (Liquidation)
o BOD may fix terms and conditions for pref. shares (as per AOI)
Terms and Cond. Effective upon filing of cert with SEC
o Cannot be issued without stated par value
Treasury Shares
o Previously issued shares and are fully paid are repurchased by the corporation through lawful
means
Needs unrestricted retained earnings in order to do so
o Can be sold again
o Not an outstanding capital
o Not included in legal capital
Redeemable Shares
o Shares issued, may be purchased corp. upon expiration of fixed period
Regardless, whether there’s unrestricted RE or none.
o May be issued when expressly provided in AOI
o When repurchased, it is immediately retired
Therefore, can’t be resold
Founder’s Shares
o Has special rights and Privilege that other SH don’t have
Such special rights and privileges shall not violate “Anti-Dummy Law” (C.A 108), “Foreign
Investment Act of 1991”(RA 7042
), and other laws.
Limited to period not exceeding 5 years
o Held by incorporators
Holders of non-voting shares may still vote in following circumstances; (Section 6)
Amendment of AOI
Adoption and Amendment of Bylaws
Disposition of all or substantially all of the corporate property
Incurring, creating, increasing bonded indebtedness
Increase or decrease of authorized capital stock
Merger or consolidation
Investment of corporate funds in another corporation
Dissolution of corporation
TITLE II.
Incorporators;
Number and Qualification; not more than fifteen
Professional Natural person not allowed to form corp. for the purpose of exercising such profession.
o Unless provided in special laws
Must be legal age
Each must own or a subscriber of at least one (1) share
Corporate Term;
No specific term in AOI Perpetual Existence
Corp. registered before Revision of this code shall have Perpetual Existence
o Unless SEC is notified by Corp. to retain specific term from its AOI
Needs vote of SH representing majority of Outstanding Capital
Not Perpetual may be extended or shortened
o By amending AOI
o No extension be earlier than 3 years prior to original/subsequent expiration
Unless there are justifiable reasons
Term expired;
o May apply for revival upon approval by SEC, and cert of revival is issued gives the corp.
perpetual existence (unless application for revival provides otherwise)
o Revival for Financial Intermediaries, Insurance, banks etc.;
Needs favorable recommendation from appropriate government agency
Contents of AOI
1. Name
2. Purpose/s
o More than one; indicate primary and secondary and so on.
3. Location of Principal Office (must be within PH)
4. Term none; Perpetual Existence
5. NNR of Incorporators
6. Number of Directors
7. NNR of Acting Dir./Tru. Until regular ones are elected and qualified
8. Authorized Capital Stock (Stock)
9. Amount of Capital (Non-Stock) NNR of Contributors, and amount contributed by each.
10. Other matters
Arbitration Agreement; may be provided in AOI
TITLE III.
BOD/BOT Qualification and Term;
Corporate Officers;
TITLE IV.
TITLE V.
TITLE VI.
TITLE VII.
TITLE VIII.
TITLE IX.
TITLE X.
TITLE XI.
TITLE XII.
TITLE XIII.
TITLE XIV.
TITLE XV.
TITLE XVI.
TITLE XVII.
Voting for Specific Corp. Act Requirement Summary
Action; Requirement;
Retainment of specific Corp. Term prior to effect of RCCP Majority of Outstanding Capital
