10 Questions
According to the Revised Corporation Code of the Philippines, what is a stock corporation?
A corporation with capital stock divided into shares
What is the main characteristic of nonstock corporations under the Revised Corporation Code of the Philippines?
They do not have capital stock divided into shares
Which term refers to a being created by operation of law with the right of succession under the Revised Corporation Code of the Philippines?
Corporation
Corporations created by special laws or charters in the Philippines are primarily governed by:
The special law or charter creating them
Under the Revised Corporation Code, what defines a corporation as an artificial being?
Having the right of succession
What is the key difference between Corporators and Incorporators?
Corporators are not mentioned in the articles of incorporation while Incorporators are.
In what circumstances can shares be deprived of voting rights?
All shares except preferred or redeemable shares can be deprived of voting rights.
What are the matters on which holders of nonvoting shares are entitled to vote?
Amendment of bylaws, merger or consolidation with other corporations, and increase or decrease of authorized capital stock.
Under what conditions are corporations not permitted to issue no-par value shares of stock?
When obtaining funds from the public and engaging in specific types of businesses.
What advantage do preferred shares have over common shares during liquidation?
Preferred shares are given preference in the distribution of dividends and corporate assets during liquidation.
Study Notes
General Provisions
- The Revised Corporation Code of the Philippines is the title of the code.
- A corporation is an artificial being created by operation of law, having the right of succession and powers, attributes, and properties authorized by law or incidental to its existence.
Classification of Corporations
- Corporations formed or organized under this code may be stock or nonstock corporations.
- Stock corporations have capital stock divided into shares and are authorized to distribute dividends or allotments of surplus profits to shareholders.
- Nonstock corporations are all other corporations that do not have capital stock divided into shares.
Corporations Created by Special Laws or Charters
- Corporations created by special laws or charters are governed primarily by the provisions of the special law or charter creating them, supplemented by the provisions of this code.
Corporators and Incorporators, Stockholders and Members
- Corporators are those who compose a corporation, whether as stockholders or shareholders in a stock corporation or as members in a nonstock corporation.
- Incorporators are those stockholders or members mentioned in the articles of incorporation as originally forming and composing the corporation and who are signatories thereof.
Classification of Shares
- The classification of shares, their corresponding rights, privileges, or restrictions, and their stated par value must be indicated in the articles of incorporation.
- Each share is equal in all respects to every other share, except as otherwise provided in the articles of incorporation and in the certificate of stock.
- Shares in stock corporations may be divided into classes or series of shares, or both.
- No share may be deprived of voting rights except those classified and issued as "preferred" or "redeemable" shares, unless otherwise provided in this code.
- Holders of nonvoting shares are entitled to vote on certain matters, such as amendment of the articles of incorporation, adoption and amendment of bylaws, and dissolution of the corporation.
This quiz provides an overview of the Revised Corporation Code of the Philippines, including important definitions and classifications. Test your knowledge about the general provisions outlined in the code.
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