1.

They QUALIFICATIONS
are elected at a meeting OF Acalled
RECTORS
rs Report 2. of Election
All
METHODS
REMOTE of
DIRECTOR
are
for a methods
OF
Directors, VOTING
COMMUNICATION
purpose; OR TRUSTEEof voting
ry, Trustees and TERM
CORPORATE Officers,
AND IN OF Non- OFFICE
REVISED
OFFICERS
ABSENTIA CORPORATION
VOTING
except: 2.The • Every director
election mustmust own
be at
by least
ballotone (1)
(if share of
ftotheholding of• Straight
Election Voting and Cessation
CODE OF THE PHILIPPINES
on. 25
from 1. President
Office • - who
Cumulative
the capital
requested);
must
voting
stock.
be afor director
one candidate
gs, 24 A.
2. Treasurer
• If
Straight
non-stock
Voting
- whoDirectors
must
corporation,
be aorresident
a trustee is required to be a
gement
nd
with
• 3.No
Cumulative
23B. Fair
3. Secretary -•who
delinquent
voting
member
must
Voting
of
be
by
the
astock
TITLE
stock
trustees
distribution
corporation.
citizen and
III
shallshall
hold
resident
be
voted;
The share of 1 year
held by the director must be
ation of 22 office
ofC.theCumulative
Philippines
registered
for
voting
Sec.
for
in hishighest
name one
and
23-45
on number
until their
the books of of the
all a. What
4.
must
Non- be
Compliance
ation.b. When and to whom
reported?
4.Candidates
Stock successors
Officer - with
only
corporation;
are
if the elected
GROUP 6 andis
corporation
candidatemust
votes be
shall reported?
be declared
Rhea Kathleenelected;
cer. vested with qualified.
public interest Joy Anadeo
powers Members
c. Who 5.
submits may
D. • Majority
cast
Cumulative
report? as manyof the directors
voting by must be
distribution
Micah Sheena residents
Bayona of the
votes as 5.The
Other officers
there are requisite
as may
Philippines.
trustees
be
to notice
provided
be must
in
Angelie the beby-
Duriquez given;
ate business. laws.
elected but6.There
may notmust
• Not castbe
have been
morepresent
convictedin byperson or of an
final judgment
orporate offense punishable by imprisonment for a period
than one vote for bya candidate.
representative authorized
exceeding 6 yrs, or a violation of the Corporation
by written proxy;
Code, committed within 5 yrs prior to his election.
 Disqualification of
)
rs Directors, Trustees or
h or without Officers
30
t removal 29 If, within five (5) years prior to the election or appointment
as such, the person was: a. Convicted by final judgment:
ot be used to 28 1. Of an offense punishable by imprisonment for a
kholders or 27 period exceeding six (6) years;
2. For violating this Code; and
of 3. For violating Republic Act No. 8799, otherwise
known as “The Securities Regulation Code”;
ich they may b. Found administratively liable for any
ction 23. offense involving fraudulent acts; and
c. By a foreign court or equivalent foreign
regulatory authority for acts, violations or
misconduct.
 Disqualification of
Removal of Directors
Directors, Trustees or
or Trustees
Officers
30 Requisites:
If, within five (5) years prior to the election or appointment
Board of 29 assuch
1. That such,removal
the person
shallwas:
takea.place
Convicted
eitherbyat final judgment:
a regular
illed only by 28 meeting of1.the Ofcorporation
an offense or punishable by imprisonment
at a special meeting for a
f the
period
called for the exceeding six (6) years;
purpose.
2. Forofviolating
2. Previous notice this Code;
the intention and such removal
to propose
27
must have 3. Forgiven
been violating Republic
to the Act No.or8799,
stockholders otherwise
members.
3. The followingknown asmust
vote “Thehave
Securities
been Regulation
obtained toCode”;
effect
the removal: a. Stock b. Found administratively
Corporation liable for any
- by the stockholders
offense
holding or representing atinvolving fraudulent
least two-thirds (2/3)acts;
of and
the
outstanding capitalc. stock.
By a foreign court or
b. Non-stock equivalent- foreign
Corporation
by a vote of at least regulatory
two-thirdsauthority
(2/3) offorthe
acts, violations or
members
entitled to vote. misconduct similar to those enumerated in
paragraphs (a) and (b) above.
 Disqualification
Removal of Directors of
Vacancies in the Office of Director
Directors, Trustees or
or Trustees
or Trustee; Emergency Board
Officers
30 Requisites:
If, within five (5) years prior to the election or appointment

of 29 1. That
A vacancy
assuch
meeting
such,removal
the person
inofthe
shallwas:
Ofoffice
1.the
takea.place
of the
an offense
corporation
Convicted
eitherby
atBoard
punishable
or
at final
byof
a special
judgment:
a regular
meeting 28
imprisonment for a
Directors orforTrustees
period may besixfilled
exceeding by:
(6) years;
27
ees
called the purpose.
2. a.
Previous 2. For violating
notice of theor this
intention Code; and
to propose such removal
Stockholders Members
must have 3. beenForgiven
violating Republic
to the Act No.or8799,
stockholders otherwise
members.
3. b.The
Board
following ofvote
known Directors
asmust
“Thehave orbeen
Trustees
Securities Regulation
obtained toCode”;
effect
b. Found
the removal: a. Stock administratively
Corporation liable for any
- by the stockholders
offense
holding or representing atinvolving fraudulent
least two-thirds acts;
(2/3) of and
the
outstanding capitalc. stock.
By a foreign court or
b. Non-stock equivalent- foreign
Corporation
regulatory
by a vote of at least authority
two-thirds (2/3) offorthe
acts, violations or
members
entitled to vote. misconduct similar to those enumerated in
paragraphs (a) and (b) above.
 Disqualification
Removal of Directors of
Vacancies
(TRUE OR FALSE) in the
Directors, Trustees or Office of Director
or Trustees
or Trustee; Emergency Board
Officers
30 Directors Requisites:
If, within five (5) years prior to the election or appointment
or trustees shall
assuch
1. That
A vacancy
such,removal
the person
inofthe
shallwas:
takea.place
Convicted
eitherby
at final29
judgment:
a regular
participate in the
meeting theOfoffice
1.determination of the
an offense
corporation atBoard
punishable
or ofbyofimprisonment
a special meeting 28 for a
Directors
their own2.percalledorforTrustees
diems
Previous
period
the
2. For or may besixfilled
exceeding
purpose.
violating
notice of theor this
intention Code;
by:
(6) years;
and
to propose such removal
27
a. Stockholders Members
compensation. must have 3. beenForgiven
violating Republic
to the Act No.or8799,
stockholders otherwise
members.
b. Boardknown of Directors or Trustees
as “The Securities Regulation Code”;
3. The following vote must have been obtained to effect
b. Found
the removal: a. Stock administratively
Corporation liable for any
- by the stockholders
offense
holding or representing atinvolving fraudulent
least two-thirds acts;
(2/3) of and
the
outstanding capitalc. stock.
By a foreign court or
b. Non-stock equivalent- foreign
Corporation
regulatory
by a vote of at least authority
two-thirds (2/3) offorthe
acts, violations or
members
entitled to vote. misconduct similar to those enumerated in
paragraphs (a) and (b) above.
 Disqualification
Removal of Directors of
Vacancies in the Office of
Directors, Trustees orDirector
orrule:
General Trustees
or Trustee; Emergency Board
Officers
30 Requisites:
If, within five (5) years prior to the election or appointment
Directors
1. That
A vacancy
assuch
such,removal
and the person
inofthe
shallwas:
trustees takea.place
Convicted
are by
not
either at final29
judgment:
a regular
meeting Ofoffice
1.the of the
an offense
corporation atBoard
punishable
or byof
a special meeting 28
imprisonment for a
entitled
Directors
called to
orfor
Trustees
period
the give may be
exceeding
purpose. themselves
sixfilled by:
(6) years;
27
2. For violating this Code; and
compensation
2. a.
Previous except
notice
Stockholders of theor with
intention
Members torespect
propose such removal
must have 3. beenForgiven
violating Republic
to the Act No.or8799,
stockholders otherwise
members.
3. b.The
Board
to reasonable of
per
known
following Directors
asdiems.
vote “Thehave
must orbeen
Trustees
Securities Regulation
obtained toCode”;
effect
b. Found
the removal: a. Stock administratively
Corporation liable for any
- by the stockholders
offense
holding or representing atinvolving fraudulent
least two-thirds acts;
(2/3) of and
the
outstanding capitalc. stock.
By a foreign court or
b. Non-stock equivalent- foreign
Corporation
regulatory
by a vote of at least authority
two-thirds (2/3) offorthe
acts, violations or
members
entitled to vote. misconduct similar to those enumerated in
paragraphs (a) and (b) above.
 Disqualification
Removal of Directors
Exceptions: of
Vacancies
a. in the
Directors, Trustees or
When fixed in the by-laws Office of Director
b. ortheTrustees
orWhen
Trustee; givingEmergency
of compensation Board is
Officers
30 approved by the
Requisites:
If,
stockholders
within five (5)
representing
years prior to the
at
election or appointment
least a majorityas of the
such, theoutstanding
person was:
1. That such removal shall take place
A vacancy inofthe
capital
a. Convicted
eitherby 29
at final judgment:
a regular
Ofoffice of the atBoard byof
stock. meeting 1.the an offense
corporation punishable
or a special meeting28
imprisonment for a

per diems.
Directors
c. When thecalled
2. a.
orforTrustees
compensation
Previous
period
the
notice
may be
exceeding
refers
purpose.
2. Forofviolating
theor
tosix
intention
filled
reasonable
this Code;
by:
(6) years;
and such removal
to propose
27
Stockholders Members
must have 3. Forgiven
been violating Republic
to the Act No.or8799,
stockholders otherwise
members.
3. b.The
Board ofvote
known Directors
asmust
“Thehave orbeen
Trustees
Securities Regulation
obtained toCode”;
Limitation on compensationb. Found administratively liableeffect
following
for any
the removal: a. Stock Corporation - by the stockholders
The total yearly
holdingcompensation offense
or representing atinvolving
of directors fraudulent
shall(2/3)
least two-thirds acts;
of and
the
not exceed 10% ofoutstanding capitalc. stock.
the net income By a foreign
before courttax
income
b. Non-stock or equivalent- foreign
Corporation
regulatory authority
(2/3) offorthe
acts, violations or
of the corporationbyduring
a vote the
of atpreceding
least two-thirds
year. members
entitled to vote. misconduct similar to those enumerated in
paragraphs (a) and (b) above.
 Disqualification
Removal of Directors of
Vacancies in the Office of Director
Directors, Trustees or
or or Trustees
Trustee; Emergency Board
Note: Officers
30 Requisites:
If, within five (5) years prior to the election or appointment
r Corporations such, the vested
person was: with
1. That such removal shall take place eitherby
as a. public
Convicted at final29
judgment:
a regular
interestArequires
vacancy
meeting into
ofthe Ofoffice
1.submit
the of their
to
an offense
corporation the atBoard
punishable
or byof
a special meeting 28
imprisonment for a
Directors
shareholders called
2. a.
and or
Previous
forTrustees
the
period
the
2. SEC
For
may
exceeding
purpose.
an
violating
notice of theor
be sixfilled
annual
this
intention Code;
by:
(6) years;
and
to propose such removal
27
Stockholders Members
report of totalmustcompensation
have 3. Forgiven
been violating for each
Republic
to the Act No.or8799,
stockholders otherwise
members.
3. b.The
Board
following ofvote
known Directors
asmust
“Thehave orbeen
Trustees
Securities Regulation
obtained toCode”;
effect
director or trustee. b. Found
the removal: a. Stock administratively
Corporation liable for any
- by the stockholders
offense
holding or representing atinvolving fraudulent
least two-thirds acts;
(2/3) of and
the
outstanding capitalc. stock.
By a foreign court or
b. Non-stock equivalent- foreign
Corporation
regulatory
by a vote of at least authority
two-thirds (2/3) offorthe
acts, violations or
members
entitled to vote. misconduct similar to those enumerated in
paragraphs (a) and (b) above.
 Disqualification
Removal of Directors of
GroundsVacancies
for liability in
to the
pay Office
damages
Directors, Trustees or of Director
or or
• a. Willingly Trustees
and knowingly
Trustee; voting for orBoard
Emergency
Note: Officers
assenting to patently unlawful acts of
Requisites:
If, within five (5) years prior to the election 30 or appointment
the corporation Corporations
Arequires
vacancy into
vested
person was: with
1. That such removal shall take place eitherby
as such, the a. public
Convicted at final 29
judgment:
a regular
• b. interest
Being guilty ofmeeting
gross ofthe Ofoffice
1.submit
negligence
the ofortheir
to
an offense
corporation the atBoard
punishable
or byof
a special meeting 28
imprisonment for a
bad faith Directors
in
shareholders called
directing
2. a.
and or
Previous
forTrustees
the
the
period
the
2. affairs
SEC
For
may
exceeding
purpose. of
an
violating
notice of theor
be
the
sixfilled
annual
this
intention Code;
by:
(6) years;
and
to propose such removal
27
corporation Stockholders Members
report of total mustcompensation
have 3. Forgiven
been violating for
Republic
to the each Act No.or8799,
stockholders otherwise
members.
• c. Acquiring 3. b.
any Board
personal
The following of
known
or Directors
asmust
“Thehave
pecuniary
vote orbeen
Trustees
Securities Regulation
obtained toCode”;
effect
director or trustee.
the removal: a. b. Found
Stock administratively
Corporation - by the liable for any
stockholders
interest in conflict with their duty as such
holding or representing atinvolving
offense fraudulent
least two-thirds (2/3)acts;
of and
the
directors or trustees.
outstanding capitalc. stock.By a foreign court or
b. Non-stock equivalent- foreign
Corporation
regulatory
by a vote of at least authority
two-thirds (2/3) offorthe
acts, violations or
members
entitled to vote. misconduct similar to those enumerated in
paragraphs (a) and (b) above.
 Disqualification
Removal of Directors of
Vacancies in the
Directors, Office of Director
Trustees or
Liability or
of directors/trustee
or Trustees
Trustee; or
Emergency Board
Note: Officers
officers for secret profits –
Requisites:
If, within five (5) years prior to the election 30 or appointment
Corporations
the director/trustee
Arequires
vacancy
such, the vested
or
personofficer
was: with
1. That such removal shall take place eitherby
as a. public
Convicted at final29
judgment:
a regular
guiltyinterest
of violation dutyinto
ofmeeting the
shall
of Ofoffice
1.submit
the be held of their
to
an offense
corporation the atBoard
punishable
or byof
a special meeting 28
imprisonment for a
accountable Directors
for
shareholders the called
2. a.
or
profits
and
Previous
Trustees
for
the
period
the
which
2. SEC
For
may
exceeding
purpose.
an
violating
notice of theor
be sixfilled
annual
this
intention Code;
by:
(6) years;
and
to propose such removal
27
otherwise would have Stockholders
accrued Forthe
Members
report of total
mustcompensation
have 3.been violating
given for each
Republic
to the Act No.or8799,
stockholders otherwise
members.
corporation. 3. b.The
Board
following ofvote
known Directors
asmust
“Thehave orbeen
Trustees
Securities Regulation
obtained toCode”;
effect
director or trustee. b. Found
the removal: a. Stock administratively
Corporation liable for any
- by the stockholders
offense
holding or representing atinvolving fraudulent
least two-thirds acts;
(2/3) of and
the
outstanding capitalc. stock.
By a foreign court or
b. Non-stock equivalent- foreign
Corporation
regulatory
by a vote of at least authority
two-thirds (2/3) offorthe
acts, violations or
members
entitled to vote. misconduct similar to those enumerated in
paragraphs (a) and (b) above.
Section 31:
A contract of the corporation with one or more of
its directors, trustees, officers or their spouses and
relatives within the 4th civil degree of consanguinity or
affinity is _____, at the option of such corporation.

a. Ratified
b. Void
c. Voidable
d. Valid
Section 31:
A contract of the corporation with one or more of its directors, trustees,
officers or their spouses and relatives within the fourth civil degree of consanguinity
or affinity is voidable, at the option of such corporation, unless all the following
requisites are present:
a. The presence of such director or trustee in the board meeting in which the
contract was approved was not necessary to constitute a quorum for such
meeting.
b. The vote of such director or trustee was not necessary for the approval of the
contract
c. The contract is fair and reasonable under the circumstances
d. In case of corporations vested with public interest, material contracts are
approved by at least ⅔ of the entire membership of the board, with at least a
majority of the independent directors voting to approve the material contract
e. In case of an officer, the contract has been previously authorized by the Board
of Directors.
Conditions for ratification of contract with director or trustee
in the absence of the first three conditions:

1. The contract is fair and reasonable under the circumstances

2. Full disclosure of the adverse interest of the director or
trustee is made at the meeting called for the purpose
3. Ratification is made by the vote of the stockholders
representing at least ⅔ of the outstanding capital stock or
of ⅔of the members.
 Contracts Between
33 Corporation with
34
38
37
36
35

Interlocking Directors
 Interlocking Director- is a director who holds seats in
the Board of Directors of two or more corporations.

The contract between two or more corporations with

interlocking directors shall be valid if,
a. There is no fraud
ctor b. The contract is fair and reasonable under the
circumstances
34
33
38
37
36
35

c. If the interest of the interlocking director in one

corporation is merely nominal, the following conditions
are concerned:
d. (1) His presence in the board meeting was not
necessary to constitute a quorum
(2) His vote was not necessary for the approval of the
contract
 The director is considered disloyal if he

WELCOME
acquire for himself a business
opportunity which should belong to
FREE POWERPOINT
thereby TEMPLATE
34

the corporation, obtaining

38
37
36
35

33
profits to theBY POWERPOINT
DESIGNED prejudice SCHOOL
of the
corporation
 Duty of disloyal director Refunding
the profits to the corporation
nt,
WELCOME
• Disloyal Director is exempted
fromFREE POWERPOINT
when his actTEMPLATE
34

liability is
38
37
36
35

33
DESIGNED
ratified BY POWERPOINT
by a vote of the SCHOOL
stockholders representing at least
⅔ of the outstanding capital
stock.
 Executive committee may act within competence
of the board if provided by the by-laws.

WELCOME
• Executive committee must be composed of at
least 3 directors.
FREE POWERPOINT TEMPLATE

34
38
37
36
35

33
• May be authorized on a majority vote of the
board to actDESIGNED BY POWERPOINT
on such specific SCHOOL
matters within the
competence of the board
 EXCEPT

WELCOME
• Approval of any action for which shareholders' approval is
also required
• Filing of vacancies in the board
• Amendment or repeal of by-laws or the adoption of new
by-laws FREE POWERPOINT TEMPLATE

34
35
38
37
36

33
• Amendment or repeal of any resolution of the board which
DESIGNED BY POWERPOINT SCHOOL
by its express terms is not amendable or repeatable
• Distribution of cash dividends to the shareholders.
Note: the Board of Directors may create special
committees of temporary or permanent nature and
determine the members' term, composition, compensation,
powers, and responsibilities.
 Corporate Powers and Capacity
• Power to sue and be sued
•
•
•
•
WELCOME
Power to adopt and use corporate seal
Power to acquire and convey property;
Powr to acquire shares or securities
FREE POWERPOINT
Power to contribute to charity; TEMPLATE

34
38
37
36

33
35
• Power to have perpetual existence;
DESIGNED BY POWERPOINT SCHOOL
• Power to amend articles or incorporation in
accordance with the provisions of this code;
• To adopt bylaws, not contrary to law, morals or
public policy, and to amend or repeal the same
in accordance with this Code;
 Corporate Powers and Capacity
• In case of stock corporations, to issue or sell stocks
to subscribers and to sell treasury stocks in

WELCOME
accordance with the provisions of this Code; and to
admit members to the corporation if it be a
nonstock corporation;
• To enter into a partnership, joint venture, merger,
FREE POWERPOINT TEMPLATE

34
38
37
36

33
35
consolidation, or any other commercial agreement
with natural and juridical
DESIGNED persons;
BY POWERPOINT SCHOOL
• To establish pension, retirement, and other plans for
the benefit of its directors, trustees, officers, and
employees; and
• To exercise such other powers as may be essential
or necessary to carry out its purpose or purposes as
stated in the articles of incorporation.
 Express Powers Implied Powers

WELCOME
FREE POWERPOINT TEMPLATE

34
36
38
37

33
35
DESIGNED BY POWERPOINT SCHOOL
 Power to Extend or Shorten Corporate
Term

by a:
WELCOME
Requisites for the exercise of the power:
1. Vote required - The act must be approved

a. MajorityFREE
vote ofPOWERPOINT TEMPLATE

34
the board of directors
38
37

33
35
36
or trustees, and
DESIGNED BY POWERPOINT SCHOOL
b. 2/3 of the outstanding capital stock, or
2/3 od the members in a meeting called
for the purpose.
2. The articles of incorporation are
amended to effect such extension or shortening
of corporate term.
 WELCOME
FREE POWERPOINT TEMPLATE

34
38

33
35
36
37

DESIGNED BY POWERPOINT SCHOOL

 (True/False)

WELCOME
Any increase or decrease in the
capital stock or the incurring,
FREE POWERPOINT TEMPLATE

34
38

33
37

35
36
creating or increasing of any
DESIGNED BY POWERPOINT SCHOOL
bonded indebtedness shall require
prior approval of the Commission.
 Power to Increase or Decrease Capital
Stock; Incur, Create or Increase
Bonded Indebtedness
Requisites: WELCOME
a. Vote required - The act must be approved by
• Majority of theFREE
boardPOWERPOINT TEMPLATE

34
38

33
37

35
36
of directors and
• 2/3 of the outstanding
DESIGNED capital stock in a
BY POWERPOINT SCHOOL
meeting called for the purpose.
b. A certificate must be signed by a majority of the
directors of the corporation and countersigned by
the chairperson.
 c. The increase or decrease if capital stock
must be approved by the SEC.

WELCOME
d. If there is an increase of capital stock, the
treasurer must execute a sworn
statement showing that at least 25% of
the increase in capital stock has been
FREE POWERPOINT TEMPLATE

34
38

33
37

35
36
subscribed and that at least 25% of the
DESIGNED
amount subscribed BY POWERPOINT
has been paid stock SCHOOL
or the incurring, creating or increasing
of any bonded indebtedness shall
require prior approval of the
Commission.
 Power to incur bonded indebtedness
Requisites:
a. Vote required - The act must be approved
by a:

directors and
WELCOME
1. Majority vote of the board of
FREE POWERPOINT TEMPLATE

34
38

33
37

35
36
2. 2/3 of the outstanding capital stock in
a meeting called forDESIGNED BY POWERPOINT SCHOOL
the purpose.
a. The incurring, creating, or increasing
of bonded indebtedness must be approved by
the SEC.
b. The bonds issued must be registered
with the SEC.
 WELCOME
FREE POWERPOINT TEMPLATE

34
38

33
37

35
36
DESIGNED BY POWERPOINT SCHOOL
 WELCOME
Power to Deny Pre-
emptive Right
FREE POWERPOINT TEMPLATE

34
38

33
37

35
36
DESIGNED BY POWERPOINT SCHOOL
Preemptive right refers to the right of existing
stockholders to purchase or subscribe to all issuances
of shares of any class, in proportion to their

WELCOME
respective stockholdings, before such shares are
offered to the public.
When a right not available
a. When it is denied by the articles of incorporation or
FREE POWERPOINT TEMPLATE

34
38
an amendment

33
37

35
36
b. b. When shares are to be issued in compliance with
DESIGNED BY POWERPOINT SCHOOL
laws requiring stock offerings or minimum stock
ownership by the public
c. c. When shares issued in good faith with the approval
of the stockholders representing ⅔ of the outstanding
capital stock, in exchange for property needed for
corporate purposes or in payment of a previously
contracted debt.
 Section 39: Sale or Other
Disposition of Assets
Subject to provisions of
END

41
44
43
42

40

Republic Act No. 10667,

known as the Philippine
Competition Act
 QUESTION: (YES or NO)

X corporation is engaged in selling pencils on

wholesale basis. It is merely renting a bodega and
90% of its assets consists of its stocks of pencil. “A”, a
school supply dealer, purchased all the stocks of x
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corp. Is the transaction a sale of substantially all

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of the assets of the corporation requiring

concurrence of stockholders representing 2/3 of
the outstanding capital stock?
nds in
e own The power to sell, lease, exchange,
ess or mortgage, pledge or otherwise dispose
wer
of all or substantially all of its property
RE
out of stock and assets must be approve by:
Votes required
rd of
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a. Majority vote of the Board of

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dness to the
bscription, Directors or trustees and,
pital
elinquent b. ⅔ of the outstanding capital stock
in a or ⅔ of the members in a meeting
itled to
called for the purpose.
 QUESTION: (YES or NO)

Aa corporation is engaged in the business of

printing books. Around 70% of its assets consists of
cash in the bank, 25% printing machine and the
remaining office equipment and supplies. Aa
END

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corporation plans to sell the machine. Can it be

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considered sale of substantially all of the assets of

the corporation?
 Dividends - part or portion of the profits of a
corporation set aside, declared, and ordered
by the directors for distribution to stockholders.

WELCOME
The board of directors of a stock
corporation has the power to declare
END

dividends outFREE POWERPOINT TEMPLATE

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of the "unrestricted retained
earnings". It could be: BY POWERPOINT SCHOOL
DESIGNED
a. Cash Dividend
b. Property Dividend
c. Stock dividend
 Exercise of the power to declare
dividends

Requisites:
WELCOME
a. Voting requirement
(1) StockFREE
Dividends -Majority voteTEMPLATE
of the
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POWERPOINT

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directors present provided there is a quorum -
DESIGNED BY POWERPOINT SCHOOL
⅔ of the outstanding capital stock entitled to
vote in a meeting called for the purpose
(2) Cash Dividends -Majority vote of the
directors present provided there is a quorum
 WELCOME
END

FREE POWERPOINT TEMPLATE

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DESIGNED BY POWERPOINT SCHOOL
 CONCEPT

WELCOME
-a contract whereby a corporation
delegates the management
or operation of its
END

FREEbusiness
POWERPOINT
to another TEMPLATE

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corporation;
DESIGNED BY POWERPOINT SCHOOL

-Also called service contract or

operating agreement.
 GENERAL RULE:

WELCOME
No management contract
shall be entered into for a
END

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period longer than five

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DESIGNED BY POWERPOINT SCHOOL
(5) years for any one (1)
term.
 Ultra Vires Acts
WELCOME
of Corporation
END

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DESIGNED BY POWERPOINT SCHOOL
 The following statements are presented
to you:

WELCOME
I. All ultra-vires acts are illegal acts.
II. All illegal acts are ultra-vires acts.
END

a. Both statements FREE POWERPOINT TEMPLATE

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are true

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b. Both statements are DESIGNED
false BY POWERPOINT SCHOOL
c. I is true; II is false
d. I is false; II is true
 Ultra Vires
WELCOME
-an act or contract
FREEwhich is beyond
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the powers that a corporation can
DESIGNED BY POWERPOINT SCHOOL
lawfully exercise.
 COVERAGE OF ULTRA
VIRES ACT
WELCOME
a. Acts beyond the powers of the corporation as
END

FREE
provided for in the POWERPOINT
law and its articles of TEMPLATE

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incorporation.
DESIGNED BY POWERPOINT SCHOOL
b. Acts or contracts entered into in behalf of the
corporation by persons who have no
corporate authority.
c. Acts and contracts that are illegal per se or
contrary to law.