SISC/QSF-OCD-007

Rev 005 6/5/14 Date:

_______________

Mid Examination
Second Semester, AY 2019-2020

Name: ____________________________________ Student Number: _______________

Course: ____________________________________ Subject: ______________________

Integrity is one’s refusal to cheat.

My actions define my character.

_______________________
Signature of Student
_____________________________________________________________________________________
I. Distinction of Terms

FACTOR STOCK DIVIDEND CASH DIVIDEND

In what Form Payable?

Effect on Capital

Level of Management
involved

Cash Flow

Application in case of
delinquency

FACTOR ULTRA VIRES ACT ILLEGAL ACT

Nature

Ratification

BOARD OF DIRECTORS EXECUTIVE COMMITTEE

FACTOR

Appointing Authority

Number

Powers

II. Identify the Level of Management

Write 1 if the Level of Management pertains to BOD alone, 2 for Stockholders alone, and 3
for both BOD and Stockholders. (Write the answer on the space provided before the
number)
1. Merger and Consolidation
2. Incur Ordinary Indebtedness
3. Sale of a Corporate Property
4. Lease of a Vehicle
5. Removal of a Corporate Officer
6. Declaration of Stock Dividend
7. Enter into Loan Agreements
8. Fill-in Vacancy on BOD due to expiration
 9. Fill-in Vacancy on BOD due to removal
10. Fill-m Vacancy on BOD due to Resignation
11. Fill-in Vacancy on BOD due to death
12. Fill-in Vacancy on BOD due to Increase of Members
13. Fill-in Vacancy due to incapacity
14. Investment of Corporate Funds for some other business
15. Declaration of Cash Dividend
16. Enter into Management Contract
17. Call for Outstanding Subscription
18. Adoption of the By-laws
19. Enter into Contract
20. Election of Members of the Board of Directors
21. Incur Bonded Indebtedness
22. Mortgage of a Property
23. Shortening Corporate Term
24. Amendment of the Articles of Incorporation
25. Election of Corporate Officers
26. Increase of Capital Stock
27. Dissolution
28. Engage in Promotions
29. Compensation of Members of the Board
30. Change of Corporate Name

III. Identify the Kind of Power: Express, Implied and Incidental

1. Adopt a Corporate Seal

2. Be a Defendant in a Case
3. File a Case in Court
4. Right of Succession
5. Purchase a Property
6. Issue Shares of Stock
7. Sale of all Assets
8. Giving Pension to employees
9. Donations to Institutions
10. Change of Corporate Name
11. Extend Corporate Term
12. Dissolution
13. Consolidation
14. Denial of Pre-emptive Right
15. Enter into Management Committee
16. Declaration of Cash Dividends
17. Enter into a new business venture
18. Increase of Capital Stock
19. Incur Bonded Indebtedness
20. Incur a Loan Agreement
IV. Essay: A mere yes or no without any justification is no answer at all.

A. A was convicted of a crime of Falsification of Public Document with a penalty of 6 years

when she falsified the Treasurer’s Affidavit of the Corporation sometime in the year 2010. In
the annual meeting of the stockholders last 5 February 2015, A was nominated and elected to
be a Member of the Board of Directors. B moved for his disqualification. Is A disqualified
from being a member of the Board of Directors. Decide. (5 points)

B. In the By-Laws of National Lizquen Corporation, it was expressly declared that A shall be a
member of the Board of Directors for the first five (5) years of the Corporation being then the
founder. B moved to protest the said provision in the By-laws. Decide. (5 Points)

C. A is the President of National Lizquen Corporation owning 50 shares of stock. In dire

necessity, A sold all his shares to B. After payment of the purchase price, A insisted to attend
the regular meeting of the Board of Directors and assumed as such. Other members of the
Board of Directors made their conformity for A to assume the position of being a member. C,
a stockholder, objected to the appointment of A. Decide. (5 points)

D. In the By-laws of National Lizquen Corporation, it was stated that “for one to be a member of
the Board, he/she must own at least 100 shares of stocks”. Is it valid? Explain. (5 Points)
 E. Explain the prohibition stated under the Anti-Dummy Law. (5 Points)

F. A, as the President of the Corporation, entered into a Contract for the purchase of the needed
cement timely for the construction of the project which is already due for turnover.
Considering the urgency of the necessity, A acted without first securing the authority from
the Board and made the necessary payment. A argued that he acted within his authority as the
President and he needs to act fast as the same would be the cause of delay. Decide. (5 Points)

Prepared by: Reviewed by:

Atty. Christian George L. Melitante Ms. Minerva Janne D. Ganaden, MBA

Instructor Program Coordinator, College of Business
Approved by: Noted by:

Dr. Victor C. Manabat, DBA Dr. Felma C. Tria, Ed.D

Dean, College of Business College Director