LAW

Q: After the existence of a quorum has been determined in a meeting of stockholders,

a number of them left the meeting thereby leaving less than a quorum. Is the majority
of the vote of those present sufficient to validity decide a matter properly presented?
 No, because they are less than the minimum or the majority of the stockholders
which will make the vote of the present not sufficient to decide the matter properly.
Since it was stated in the Section 51. Quorum in Meetings that a quorum shall
consist of the stockholders representing a majority of the outstanding capital stocks
or a majority of the members in the case of nonstock corporations. Thus, the
presence of stockholders or members are entitled to vote, represents the majority of
the members.

APPLICATION
a. What is a derivative suit?
 A lawsuit brought by a shareholder of a corporation on its behalf to enforce or
defend a legal right or claim, which the corporation has failed to do. Derivative
suits permit a shareholder to bring an action in the name of the corporation against
parties allegedly causing harm to the corporation.

b. What are the different modes by which shares may be distributed?

 Some of the modes by which shares may be distributed are public issue or initial
public offer (IPO), private placement, offer for sale, sale through intermediaries,
sale to inside coterie, sale through managing brokers, and privileged subscriptions.

ASSESSMENT
a. What are the books and records are required by law to be kept by
corporation?
 The books and records that must be kept by the corporation are records of all
business transactions and minutes book for meetings of the stockholders or
members, or of the board of directors or trustees. The minutes of books include the
time and place of holding the meeting, how the meeting is authorized, notices
given, regular or special meeting, present and absent, and act done at meeting.
b. When a corporation sells its assets to another corporation, does the acquire all
assets of the corporation including the obligations of corporation to other
creditors?
 It depends if a company buys all or almost all of another company's assets (rather
than shares) in a direct purchase, the buying (or acquiring) company simply extends
its ownership and control over the new assets. Unless the transaction is to be paid
for with stock and the acquiring corporation must issue new shares to make the
purchase, in which case its shareholders must approve the additional shares, the
purchasing corporation does not need shareholder approval. For the liability issue,
many entities prefer to acquire "just the assets," but this strategy also allows them
to "write up" the assets so that they can be depreciated at a greater value.