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15. In a case of merger, the employees of the 20. A corporation sole may validly sell/transfer its
absorbed corporation/dissolved corporation old van for purposes of acquiring a new one
are automatically absorbed by the without court order?
absorbing/surviving corporation? - True. In case of personal property, intervention
- Employees of the absorbed or dissolved of courts shall not be necessary.
corporation are automatically absorbed by the
surviving corporation even in the absence of a 21. The winning bidder in a delinquency sale is the
resolution to that effect because it is more in highest bidder?
keeping with social justice and full protection to - False. The winning bidder is the lowest bidder
labor. Nevertheless, the surviving corporation has from the wordings of the statute. The bidder who
the right to terminate the employment of the tenders to pay the full amount of the delinquency
absorbed employees for a lawful or authorized plus cost and expenses, if any for the least
cause. In the same way, the absorbed employees number of shares.
have the right to resign, retire or otherwise sever
their employment with the surviving corporation 22. The beneficial owner of a voting trust
even before or after the merger or consolidation, agreement may validly transfer his shares by a
subject to existing contractual obligations. (BPI v. mere notarized deed?
BPI Employees Union) - True.
16. A transferee of a certificate of stock in a non- Two modes of transferring shares of stock:
stock corporation, if they are transferable by 1. When the corporation has already issued stock
virtue of a by-law provision, has the same certificates – transfer is done only through endorsement and
right, power and authority to compel the delivery of the certificate or certificates of stock indorsed by
corporation to register the said transfer in the the owner or his attorney-in-fact or other person legally
corporate books in his name, in order that he authorized to make the transfer.
may be considered as a shareholder, in the
same manner that the transferee of a 2. When the corporation has not yet issued certificates
certificate of stock in a stock corporation may of stock – by a duly notarized deed. If a certificate of stock
do so. has been issued a mere notarized deed will not suffice. It must
- True (Sec. 87, last par.), the provision governing be coupled with endorsement and delivery of the stock
stock corporation, when pertinent, shall be certificate.
applicable to non-stock corporations, except as
may be covered by specific provisions of this 24. A director whose shares are declared
Title. delinquent does not automatically cease to be a
director?
11. Distribution of assets upon dissolution of non-stock 8. Transacting business in the Phils. as agent of or acting for
corporations and in behalf of any foreign corporation or entity not duly
licensed to do business in the Phils;
In case dissolution of a non-stock corporation in accordance
with the provisions of this Code, its assets shall be applied and 9. Any other grounds as would render it unfit to transact
distributed as follows: business in the Phils.
1. All liabilities and obligations of the corporation shall 13. Requirements and procedure for the withdrawal of
be paid, satisfied and discharged, or adequate provision shall Foreign Corporations:
be made therefore;
1. Filing of a petition for withdrawal of license;
2. Assets held by the corporation upon a condition
requiring return, transfer or conveyance, and which condition 2. All claims which accrued in the Phils. have been paid,
occurs by reason of the dissolution, shall be returned, compromise or settled;
transferred or conveyed in accordance with such requirements;
3. All taxes, imposts, assessment and penalties, if any, lawfully
3. Assets received and held by the corporation subject to due to the Philippine Government or any of its agencies or
limitations permitting their use only for charitable, religious, political subdivisions have been paid;
benevolent, educational or similar purposes, but not held upon
a condition requiring return, transfer or conveyance by reason 4. Publication of the petition for withdrawal once a week for 3
of the dissolution, shall be transferred or conveyed to one or consecutive weeks in a newspaper of general circulation in the
more corporations, societies or organizations engaged in Philippines; and
activities in the Philippines substantially similar to those of the
5. Issuance of certificate of withdrawal by the SEC.
dissolving corporation according to a plan of distribution
adopted pursuant to this Chapter; 14. Instances when a Foreign Corporation w/ no
license to do business in the Philippines can sue:
4. Assets other than those mentioned in the preceding
paragraphs, if any, shall be distributed in accordance with the a) The act or transaction involved is an “isolated transaction;”
provisions of the articles of incorporation or the by-laws, to the (Bulakhidas vs. Navarro);
extent that the articles of incorporation or the by-laws,
determine the distributive rights of members, or any class or b) The foreign corporation is not seeking to enforce any legal
classes of members, or provide for distribution; and or contractual rights arising from, or growing out of any
business which it has transacted in the Philippines;
5. In any other case, assets may be distributed to such
persons, societies, organizations or corporations, whether or c) The purpose of the suit is to protect its trademark,
not organized for profit, as may be specified in a plan of tradename, reputation or good will. (Western Equipment and
distribution adopted pursuant to this Chapter. (Sec. 94) Supply Co. vs. Reyes);
12. Grounds for revocation of license (Foreign d) The suit is based on violation of the RPC; (Lechemise
Corporation) Lacoste vs. Fernandez);
15. What is dissolution? 3. The surviving or the consolidated corporation will possess all
the rights, privileges, immunities and powers and shall be
- It is the extinguishment of the corporate franchise and the subject to all the duties and liabilities of a corporation
termination of corporate existence. organized under this Code.
General Rule: When a corporation is dissolved, it ceases to be 4. The surviving or the consolidated corporation shall possess
a juridical entity and can no longer pursue the business for all the rights, privileges, immunities and franchise of the
which it is incorporated. constituent corporation, and all property and all receivables
Exception: The Corporation will continue as a body corporate due on whatever account, including the interest of, or
for another period of 3 years from the time it is dissolved for belonging to, or due to its constituents corporation shall be
the purpose of winding up its affairs and the liquidation of its deemed transferred to and vested in such surviving or
assets. consolidated corporation without further act or deed; and
27. The three-year period of liquidation will not apply if General Rule: An insider may not sell or buy a security of the
a trustee/assignee/receiver is appointed to undertake issuer while in possession of material information with respect
the same to the issuer or the security that is not generally available to
the public.
- It will not apply, under Sec. 122 of the Code (2) from and
after any such conveyance by the corporation of its property in Exceptions:
trust for the benefit of its stockholders, members, creditors,
and others in interest, all interest which the corporation had in 1. The insider proves that the information was not gained from
the property terminates, the legal interest vests in the such relationship; or
trustees, and the beneficial interest in the SH, members, 2. The insider disclosed the information to a party reasonably
creditors, or other persons in interest. believed by the insider to possess the information.
28. If not denied by a provision in AOI, the pre-emptive 6.Who is an insider?
right of a corporation is absolute.
a) The issuer;
- The statement is correct, why? Because under Sec. 102, the
pre-emptive right of a close corporation shall extend to all b) A director or officer (or person performing a similar
stock to be issued, including reissuance of treasury shares, functions) of, or a person controlling the issuer;
c) A person whose relationship or former relationship to the
issuer gives or gave him access to material information about
the issuer or the security that is not generally available to the
public;
Note: Marking the close, painting the tape, squeezing the float,
hype and dump, and boiler room operations are illegal when
they are effected to
ANSWER:
ANSWER:
No, until and unless all his shares are bidded out and sold to
the winning bidder, he remains the owner of the shares of
stock. It is still registered in his name in the books of the
corporation. Therefore, he remains as a stockholder, and even
if it may be sold at public auction, he can still continue acting
as the director.
ANSWER: