Notesale: Turn your study into money

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Corporations Created by Special Laws / Charters
Corporations may be also formed by virtue of special laws or charters, and shall be governed primarily by the provisions
applicable to them
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Corporators
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2
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Those stockholders or members mentioned in the articles of incorporation as originally forming and
composing the corporation and who are signatories thereof
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Stockholders
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4
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Corporators of a non-stock corporation
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Promoters
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Capital Stock Terms
1
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Amount specified in the articles of incorporation paid in for carrying on of the business of the
corporation
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Authorized capital stock
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b
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Part of capital stock which is subscribed, whether paid or unpaid
c
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Total shares of stock issued to subscribers/stockholders, whether or not fully or
partially paid, except treasury shares
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Paid up capital stock
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e
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Part of capital stock which is not issued nor subscribed
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Legal capital
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Example Problem:
The articles of incorporation of Pol Corporation provide for an authorized capital stock of PHP 10,000,000 divided into
10,000 shares each
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Find for:
1
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Subscribed capital stock – PHP 2,500,000 (10M x 25%)
3
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Unissued capital stock – PHP 7,500,000 (10M – 2
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Paid up capital stock – PHP 625,000 (10M x 25% x 25%)
6
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One of the units into which the capital stock of the corporation is divided
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Written acknowledgement by the corporation of the stockholder’s interest in the corporation
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Nominal value of which appears to the stock certificate
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One without any nominal or par value appearing of stock certificates
Classes of Shares of Stock
1
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2
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a
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Non-cumulative preferred stock – entitled the holder for payment to current dividends but not those in
arrears, before holders of common shares are paid
c
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Non-participating preferred stock – entitle the holder only to the amount stipulated paid to holders of
preferred shares
Redeemable Shares
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Founder’s Shares
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Treasury Shares
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Watered Shares
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Voting Shares
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Non-voting Shares
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Incorporation and Organization of Private Corporations
Steps in Incorporation
1
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No corporate name shall be allowed if the proposed name is:
a
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Patently deceptive, confusing or contrary to existing laws
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Drafting and execution of articles of incorporation signed by the incorporators
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Filing of articles of incorporation with SEC
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Payment for the filing, publication and other fees
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Issuance of certificate of incorporation by SEC
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Name of corporation
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Purpose of the corporation
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Place of principal office which must be in the Philippines
4
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Names, nationalities and residences of incorporators (majority are residents of Philippines, and must be at least a
subscribed of one share of stock)
6
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Amount of authorized capital stock, number of shares divided, and par value of each
8
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(must not be
lower than PHP 5,000)
9
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Name of temporary treasurer elected, notarial acknowledgement, and affidavit
Amendment of Articles of Incorporation
Votes required for amendment
1
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Vote or written assent of 2/3 of the outstanding capital stock or members
Effectivity
Upon approval by SEC or from the date of filing with Commission if not acted within 6 months
Non-use of corporate charter for:
 Two years – shall be deemed dissolved unless the same is due to causes beyond the control of the corporation
as may be determined by SEC
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