Vacancies in the Office of Director or Trustee; Emergency Board......... 88 Compensation of Directors or Trustees ..................................................... 90 Liabilities of Directors, Trustees, or Officers ............................................ 91 Dealings of Directors, Trustees, or Officers with the Corporation........ 92 Contracts Between Corporations with Interlocking Directors............... 93 Disloyalty of a Director ................................................................................ 93 Executive Management and Other Special Committees......................... 95 Lesson 2.2: POWERS OF CORPORATIONS Corporate Powers and Capacities............................................................... 97 Power to Extend or Shorten Corporate Term ............................................ 98 Power to Increase or Decrease Capital Stock; Incur, Create, or Increase Bonded Indebtedness............................................................... 98 Power to Acquire Own Shares.................................................................... 101 Power to Invest Corporate Funds in Another Corporation or Business or for Any Other Purpose ...........................................................102 Power to Declare Dividends........................................................................ 103 Power to Enter into Management Contract............................................... 106 Ultra Vires Acts of the Corporations ..........................................................107 Lesson 3.1: BYLAWS Adoption of Bylaws ......................................................................................109 Lesson 3.2: MEETINGS Regular and Special Meetings of Stockholders or Members.................. 113 Regular and Special Meetings of Directors or Trustees; Quorum......... 116 Person in Charge of Presiding the Meetings ...........................................117 Right to Attend and Vote in Meetings ....................................................... 117 Manner of Voting; Proxies........................................................................... 118 CHAPTER 2: RIGHTS OF STOCKHOLDER, MERGER, AND APPRAISAL RIGHT LESSON 1: Lesson 1.1: STOCKS AND STOCKHOLDERS Subscription Contract................................................................................... 127 Consideration for Stocks .............................................................................. 129 Certificate of Stock and Transfer of Shares ............................................... 129 Issuance of Stock Certificates...................................................................... 131 LESSON 3: v Its Qualifications and Terms ...................................................................... 81 Disqualification of Directors, Trustees, or Officers ................................. 82 Election of Directors or Trustees ............................................................... 84 Corporate Officers ....................................................................................... 85 Report of Election of Directors, Trustees, and Officers; Non-holding of Election and Cessation from Office .............................. 87 Removal of Directors or Trustees .............................................................. 87 PRIVATE CORPORATIONS Number and Qualifications of Incorporators ........................................... 70 Terms of Corporate Existence ..................................................................... 72 Capital Stock Requirements ....................................................................... 72 Contents of the Articles of Incorporation.................................................. 73 Amendment of Articles of Incorporation.................................................. 74 Grounds When Articles of Incorporation or Amendment May Be Disapproved .................................................................................... 75 Corporate Name ........................................................................................... 76 Registration, Incorporation, and Commencement of Corporate Existence ..................................................................................... 77 Effects of Non-use of Corporate Charter and Continuous Inoperation .............................................................................. 78 LESSON 2: Lesson 2.1: BOARD OF DIRECTORS/TRUSTEES AND OFFICERS The Board of Directors or Trustees of a Corporation,
Business Laws and Regulations
Liability of Directors for Watered Stocks ..................................................132 Delinquency Sale ..........................................................................................134 Effects of Delinquency ................................................................................. 136 Lost or Destroyed Certificates ....................................................................136 Lesson 1.2: CORPORATE BOOKS AND RECORDS Books to Be Kept; Stock Transfer Agent ....................................................142 Right to Financial Statements .....................................................................144 Lesson 2.1: MERGER AND CONSOLIDATION Plan of Merger or Consolidation ...............................................................145 Stockholders’ or Members’ Approval ........................................................ 146 Articles of Merger or Consolidation ..........................................................147 Effectivity of Merger or Consolidation ...................................................... 148 Effects of Merger or Consolidation ............................................................149 Lesson 2.2: APPRAISAL RIGHT When to Exercise Appraisal Right .............................................................151 CHAPTER 3: OTHER CLASSES OF CORPORATIONS, DISSOLUTION, AND POWERS OF SEC LESSON 1: NONSTOCK CORPORATION Purposes .................................................................................................................159 Right to Vote........................................................................................................... 160 Election and Term of Trustees .............................................................................160 Rules of Distribution of Assets ............................................................................ 161 Conversion from a Stock Corporation to a Nonstock Corporation ................ 162 LESSON 2: Lesson 2.1: CLOSE CORPORATIONS Articles of Incorporation.............................................................................. 164 Effects of Issuance or Transfer of Stocks in Breach of Qualifying Conditions ................................................................................. 164 Agreements by Stockholders.......................................................................165 When a Board Meeting is Unnecessary or Improperly Held .................166 Amendment of Articles of Incorporation.................................................. 166 Deadlocks....................................................................................................... 166 Withdrawal of Stockholder or Dissolution of Corporation..................... 167 LESSON 2.2: SPECIAL CORPORATIONS LESSON 2.2.1: EDUCATIONAL CORPORATIONS Board of Trustees .................................................................................168 LESSON 2.2.2: RELIGIOUS CORPORATIONS Corporation Sole................................................................................... 169 Articles of Incorporation ..................................................................... 169 Submission of the Articles of Incorporation ....................................170 Acquisition and Alienation of Property ...........................................170 Filling of Vacancies .............................................................................. 171 Dissolution ............................................................................................ 171 Religious Societies................................................................................171 LESSON 2.2.3: ONE-PERSON CORPORATION Minimum Capital Stock Not Required for One-person Corporation ..................................................................... 172 Articles of Incorporation ....................................................................172 Bylaws .................................................................................................... 173 Display of Corporate Name ................................................................ 173 Single Stockholder as Director and President.................................. 173 Nominee and Alternate Nominee .....................................................173 Treasurer, Corporate Secretary, and Other Officers .......................174 Minute Books, Records, and Reportorial Requirements ................ 175 Conversion from an Ordinary Corporation to OPC .......................176 Conversion from OPC to an Ordinary Stock Corporation............. 177 LESSON 3: DISSOLUTION OF CORPORATION Methods of Dissolution ........................................................................................180 Voluntary Dissolution Where No Creditors Are Affected ..............................180 Voluntary Dissolution Where Creditors Are Affected; Procedure and LESSON 2:
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2025 Higher Education Learning Solutions for the Business and Accountancy Program 136
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