Summary Quizzer in Corporation Law

Summary Quizzer in Corporation Law

Atty. Macmod

A. Identification/ Basic concepts/ Principles 1. Theory that a corporation owes its life from the state. 2. Theory that a corporation is independent of State existence. 3. Theory that a corporation is a group of businessmen only. 4. Theory that a corporation enjoys a distinct personality. 5. Theory that a corporation and its officers/ BOD’S are one. 6. Death of components of a corporation will not affect its life. 7. A body that holds corporate powers. 8. A private corporation performing public functions. 9. A corporation created for charitable purpose. 10. Corporate nationality is determined by its principal office. 11. Corporate nationality is determined by place of organization. 12. Corporate nationality is determined by its principal stockholders. 13. A corporation with at least 200 stockholders and P50 M or more assets. 14. Theory that a corporation cannot declare dividends w/out Surplus profit (URE). 15. Amount fixed by the corporate charter to be subscribed and paid. 16. They represent real equity in a corporation. 17. They represent credit due from the corporation. 18. Shares w/c are not allowed to banks, trust companies, public utility co., insurance co., etc. 19. Minimum amount allowed for no par values shares. 20. A Certificate of Stock indorsed in blank by a stockholder and entrusted to a broker. 21. Shares w/c have been issued for a condition. 22. Shares that can be issued even for less than their par value. 23. Shared issued at less than their par value. 24. Refers to a right of a dissenting stockholder. 25. Minority stockholders principal remedy against the majority stockholders. 26. Corporation with not more than 20 stockholders. 27. Can sue and be sued in the Philippines. 28. Can have more then 15 incorporators. 29. Composed of 1 incorporator only. 30. Can only be questioned by the solicitor general.

B. True or False 31. The two-year rule is automatic just like the 5-year rule. 32. Incorporators and corporators must be capacitated to enter into a contract always. 33. President of the corporation need not to be a stockholder. 34. A resident alien can be a corporate secretary. 35. A board director can be required to own more than 1 share. 36. Majority of board directors must be Resident citizens. 37. Executive officers are elected by majority vote of OCS. 38. An executive committee has the power to amend Board resolutions. 39. Conviction of a crime punishable by 6 yrs. imprisonment disqualified a board director. 40. Board directors are not entitled to compensation as a rule. 41. Corporate Powers are vested in the Executive officers. 42. Board directors are removed by 2/3 votes of stockholders. 43. Even non-voting shares can vote in the election of officers. 44. Directors are solidarily liable for damages suffered by the corp. due to their acts. 45. Stockholders are liable to pay corporate debts even up to their separate property. 46.Appraisal right can be exercised in the increase of capital stocks. 47. Pre-emptive right can be denied by the corporate charter. 48. Self-dealing directors are prohibited by the Corporation Code. 49. Ultra vires acts are prohibited hence voidable. 50. Cumulative voting is normally allowed in Non-stock Corporation. 51. A delinquent Stockholder loses all his rights. 52. Stockholders can meet anywhere if by laws provided. 53. No transfer of shares is allowed in close corporations. 54. Majority vote of OCS is required to elect Board directors. 55. Stockholders can compel the corporation to declare dividends if there is Surplus profit. 56. Sale of all corporate assets requires approval of all stockholders. 57. Stock dividends cannot be issued to non-stockholders even for services rendered to the corporation. 58. No dividends can be declared out of capital except liquidating dividends only.

59. Amendments to the articles of incorporation can take effect even w/o SEC approval. 60. Proxy and VTA must be both notarized. 61. The Holder of a VTA can be elected board director. 62. Shares of Stocks cannot be transferred gratuitously. 63. Stock subscriptions are indivisible contracts. 64. Pre- emptive right in close corporations include treasury shares. 65. De facto corporations must possess a certificate of incorporation from SEC. 66. Board members of school must always be in multiple 5 and 1/5 shall be elected yearly. 67. Stock corporations can be converted into a Non-stock Corporation. 68. Illegal acts are ultra vires and vise versa. 69. Voluntary dissolution does not require any hearing. 70. Life of a corporation can be extended for another 50 yrs. in the last 6 years of its life. 71. After dissolution, a corporation can still exist for 3 more years but for liquidation purposes only. 72. To declare dividends is w/in the express powers of a corporation. 73. The Code of Corporate governance is applicable to all stock corporations. 74. Cumulative voting in stock corporations is mandatory. 75. Authorized capital stock of P1 M requires a paid up capital of at least P50, 000. 76. Quorum for Board meetings shall be majority of board directors always. 77. Corporate life starts upon filing of Articles. of Inc. 78. Cert. of Inc. can be issued even w/out by laws. 79. Board directors can attend by proxy if by laws provided. 80. Ultra vires can be ratified if consented by all stockholders.