Buslaw 2 REVIEWER

Two types of Person

- Natural
- Artificial

BUSINESS ORGANIZATION

Sole Proprietorship

Partnership

Business Trust

Joint Venture

Cooperatives

Corporation

CORPORATION - • A corporation is an artificial being created by operation of law,

having the right of succession and the powers, attributes and properties expressly
authorized by law or incident to its existence

How corporation are created?

-general law

-special law

STAGES OF INCORPORATION

-Promotion

-Incorporation

-Formal organization
BASIC CONTENTS OF AN AOI

1.Name of the Corporation

2.Specific purpose

3.Place of principal office

4.Term of corporate life

5.Names, nationalities and residences of the incorporators

6.Number of directors or trustees

TERM OF EXISTENCE 50years

INCORPORATORS must be:

- Natural Persons

- Legal age

- Subscriber to at least one share of capital stock

- Majority must be residents of Philippines

Directors/Trustees must be:

- Own at least one share of capital stock

- Residents of the Philippines

- Not convicted by final judgement of an offence punishable by imprisonment for a

period exceeding 6 years

- Independent directors

Authorized capital stock at least 25% has been paid

Power of stockholders

- Extension or shortening of corporate term

- Increase or decrease of the capital stock

- Other matters

Share of Stock - Unit of capital stock which represents the interest or the right of the
holder.

Par Value Share - Share with specific money value fixed in the AOI and appearing in
the cerificate of stock.

No Par Value Share - Share without any stated value appearing on the face of the
certificate of stock

Voting Share - right to vote

Non Voting share - without right to vote
Common Share - Entitles holder to an equal pro rata division of the profits
Preferred Share - Payment of dividends or distribution of an assets of a corporation in
case of its liquidation

Promotion Shares - For promoters

Share in Escrow - Third party deposited to an agent or grantor until the event is
happening

Convertible Stock - Changes

Treasury Share - fully paid

Components of a corporation

- Promoter

- Corporator

- Incorporator

- Stockholder

- Member

CORPORATE POWERS

- Express

- Implied

- Incidental

KINDS OF MEETINGS
-Stockholder (Annually) APRIL

-Directors or13 Trustees (monthly)

Voting Trust Agreement - Writing agreement one or more shareholders is transferring

their shares to any person or to a corporation for the purpose of vesting to them voting

Voting Trust Agreement Limitations

- Should not exceed 5 yrs

- Not to be used as a fraud

- Must be written and notarized

- Certificate copy must be filled with the corporation and SEC

- Shall be subject to examination by the SH

Subscription of contract

Irrevocable for at least 6 months from date of subscription/ beyond 6 months after AOI

Revocable if fails to incorporate

Sources of corporate assets

- Contributions

- Loans

- Profits

- Stock Dividends
Stock Delinquent unpaid for 30days