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How is the term “outstanding capital stock” defined under the Revised Corporation Code?

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How is the term “outstanding capital stock” defined under the Revised Corporation Code? The term “outstanding capital stock” is defined as the total shares of stock issued under binding subscription contracts to subscribers or stockholders (SEC. 173, Revised Corporation Code of the Philippines). This total includes shares whether they are fully paid or only partially […]

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Who is the winning bidder at a delinquency sale, and how are the resulting shares transferred?

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Who is the winning bidder at a delinquency sale, and how are the resulting shares transferred? The delinquent stock is sold at public auction to the bidder who offers to pay the full amount of the balance due, together with accrued interest, costs of advertisement, and expenses of sale, for the smallest number of shares

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Who has the right to vote shares in a stock corporation when the shares are subject to a security interest?

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Who has the right to vote shares in a stock corporation when the shares are subject to a security interest? In cases where a stockholder grants a security interest in their shares (like a pledge or chattel mortgage), the stockholder-grantor shall retain the right to attend and vote at meetings of stockholders (SEC. 54, Revised

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What is the rule for voting shares of stock owned jointly by two or more persons?

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What is the rule for voting shares of stock owned jointly by two or more persons? When shares are owned jointly by two or more persons, the consent of all co-owners shall be necessary for voting those shares (SEC. 55, Revised Corporation Code of the Philippines). This joint consent is required unless the co-owners execute

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Name two types of consideration that are explicitly prohibited for the issuance of shares of stock.

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Name two types of consideration that are explicitly prohibited for the issuance of shares of stock. Stocks shall not be issued for a consideration less than their par or issued price, a principle known as prohibiting “watered stock” (SEC. 61, Revised Corporation Code of the Philippines). The Code then explicitly prohibits the issuance of shares

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When consideration for stocks is other than cash, who determines the valuation, and whose approval is required?

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When consideration for stocks is other than cash, who determines the valuation, and whose approval is required? Where the consideration for the issuance of stock is something other than actual cash, such as property, or consists of intangible property like patents or copyrights, the initial valuation thereof is determined by the stockholders or the board

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What is necessary for the valid transfer of shares of stock, besides the delivery of the certificate?

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What is necessary for the valid transfer of shares of stock, besides the delivery of the certificate? Shares of stock are personal property and may be transferred by delivery of the certificate indorsed by the owner or their authorized representative (SEC. 62, Revised Corporation Code of the Philippines). However, no transfer shall be valid, except

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What is the general rule regarding the preemptive right of stockholders, and how can it be denied?

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What is the general rule regarding the preemptive right of stockholders, and how can it be denied? The general rule dictates that all stockholders of a stock corporation shall enjoy the preemptive right to subscribe to all issues or disposition of shares of any class (SEC. 38, Revised Corporation Code of the Philippines). This right

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What financial requirement must be met before a stock corporation can acquire its own shares (other than redeemable shares)?

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What financial requirement must be met before a stock corporation can acquire its own shares (other than redeemable shares)? A stock corporation has the power to purchase or acquire its own shares for a legitimate corporate purpose, provided that the corporation has unrestricted retained earnings in its books to cover the shares to be purchased

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What details regarding capital structure must a stock corporation’s Articles of Incorporation set forth?

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What details regarding capital structure must a stock corporation’s Articles of Incorporation set forth? If the corporation is a stock corporation, its Articles of Incorporation must detail the amount of its authorized capital stock, the number of shares into which this capital stock is divided, and the par value of each share (SEC. 13, Revised

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