REVISED CORPORATION CODE (RCC)

Case Overview and Summary

DEFINITIONS AND CLASSIFICATIONS

- Section 2 defines a corporation as an artificial being created by law with rights, powers, and properties authorized by law.
- Section 3 classifies corporations into stock (with capital stock divided into shares) and non-stock corporations.
- Section 4 states that corporations created by special laws shall be governed by those laws, supplemented by this Code.
- Section 5 defines corporators, incorporators, stockholders, and members.
- Section 6 covers classification of shares, voting rights, par value, and no-par value shares.
- Section 7 allows founders' shares with special rights for a limited period.
- Section 8 defines redeemable shares that the corporation can purchase back.
- Section 9 defines treasury shares as reacquired shares that can be disposed of.

INCORPORATION AND ORGANIZATION

- Section 10 states the qualifications for incorporators and allows one person corporations.
- Section 11 provides for perpetual corporate existence unless stated otherwise.
- Section 12 states there is no minimum capital stock requirement for stock corporations.
- Section 13 lists the required contents of articles of incorporation.
- Section 14 provides the standard form for articles of incorporation.
- Section 15 allows amendment of articles by majority board and 2/3 stockholder votes.
- Section 16 lists grounds for the Commission to disapprove articles or amendments.
- Section 17 prohibits corporate names that are not distinguishable.
- Section 18 outlines the registration and incorporation process.
- Section 19 allows inquiry into corporate rights through quo warranto proceedings.
- Section 20 imposes liability on those acting as a corporation without authority.
- Section 21 provides for revocation of charter for non-use or continuous inoperation.

BOARD, TRUSTEES, OFFICERS

- Section 22 vests corporate powers in the board, states qualifications and term.
- Section 23 covers election of directors/trustees and voting rights.
- Section 24 requires appointment of president, treasurer, resident secretary.
- Section 25 requires reporting of election results to the Commission.
- Section 26 lists grounds for disqualification of directors/trustees/officers.
- Section 27 allows removal of directors/trustees by 2/3 stockholder vote.
- Section 28 covers filling of vacancies and emergency boards.
- Section 29 limits compensation of directors/trustees unless allowed by bylaws.
- Section 30 imposes liability for willful unlawful acts or conflicts of interest.
- Section 31 voids contracts with interested directors/trustees unless conditions met.
- Section 32 allows contracts between interlocked corporations if fair.
- Section 33 requires directors to account for usurped corporate opportunities.
- Section 34 allows board committees including an executive committee.

CORPORATE POWERS

- Section 35 lists the general corporate powers.
- Section 36 allows extension or shortening of corporate term by 2/3 vote.
- Section 37 requires 2/3 stockholder approval for changes in capital or debt.
- Section 38 allows denial of preemptive rights in the articles.
- Section 39 requires board approval for sale of assets, 2/3 for all/substantially all.
- Section 40 allows stock buybacks if there are unrestricted retained earnings.
- Section 41 allows investments outside primary purpose by 2/3 stockholder vote.
- Section 42 allows declaration of dividends from unrestricted retained earnings.
- Section 43 requires stockholder approval for management contracts.
- Section 44 limits corporate powers to those authorized in the articles.

BYLAWS

- Section 45 requires bylaws to be approved by majority stockholders.
- Section 46 lists the provisions that may be included in the bylaws.
- Section 47 allows bylaw amendments by majority board and stockholders.

MEETINGS

- Section 48 classifies meetings as regular or special.
- Section 49 requires annual stockholder meetings and specifies notice requirements.
- Section 50 requires meetings at the principal office unless not practicable.
- Section 51 defines quorum as majority of outstanding capital stock.
- Section 52 requires monthly board meetings unless bylaws state otherwise.
- Section 53 states the president or chairman shall preside over meetings.
- Sections 54-57 cover voting rights, proxies, joint owners, and treasury shares.

STOCKS AND STOCKHOLDERS

- Sections 59-62 cover subscription contracts and issuance of stock certificates.
- Section 63 prohibits issuing certificates until fully paid.
- Section 64 imposes liability for watered stock on directors/officers.
- Section 65 allows interest charges on unpaid subscriptions.
- Sections 66-69 cover procedures for calling unpaid subscriptions and delinquency sales.
- Section 70 suspends delinquent stockholder rights except dividends.
- Section 71 gives full stockholder rights to non-delinquent partial payers.
- Section 72 provides for replacing lost or destroyed stock certificates.

CORPORATE BOOKS AND RECORDS

- Section 73 requires keeping corporate records open for inspection.
- Section 74 requires providing recent financial statements to stockholders.

MERGER AND CONSOLIDATION

- Section 75 allows merger or consolidation of corporations.
- Section 76 requires 2/3 stockholder approval for merger/consolidation plans.
- Section 77 requires articles of merger/consolidation to be filed.
- Section 78 states the Commission shall approve if requirements are met.
- Section 79 specifies the effects of an approved merger or consolidation.

APPRAISAL RIGHTS

- Section 80 gives appraisal rights in certain corporate acts.
- Sections 81-85 cover the procedures for exercising appraisal rights.

NONSTOCK CORPORATIONS

- Section 86 defines a nonstock corporation.
- Section 87 allows various purposes for nonstock corporations.
- Section 88 allows limiting or denying voting rights of members.
- Section 89 states memberships are non-transferable unless allowed.
- Section 90 allows termination of membership per the bylaws.
- Section 91 covers election and terms of trustees.
- Section 92 requires keeping an updated members list.
- Sections 93-94 cover distribution of assets upon dissolution.

CLOSE CORPORATIONS

- Section 95 defines a close corporation and applicability of the title.
- Section 96 allows restricting transfers and classifications in articles.
- Section 97 allows transfer restrictions if properly disclosed.
- Section 98 allows refusing transfers violating restrictions.
- Section 99 allows stockholder agreements on voting, management, etc.
- Section 100 validates informal director actions in certain cases.
- Section 101 extends preemptive rights to all new issues.
- Section 102 requires 2/3 vote to amend provisions required for close corporations.
- Section 103 allows the Commission to intervene in deadlocks.
- Section 104 allows withdrawal of stockholders or dissolution for oppression.

SPECIAL CORPORATIONS

- Section 105 subjects educational corporations to special laws.
- Section 106 requires 5-15 trustees for nonstock educational corporations.
- Sections 107-114 cover corporations sole and religious corporations.
- Sections 115-132 cover one person corporations (OPCs).

DISSOLUTION

- Section 133 allows voluntary or involuntary dissolution.
- Section 134 allows dissolution by majority stockholder vote if no creditors affected.
- Section 135 requires 2/3 stockholder approval if creditors are affected.
- Section 136 allows dissolution by shortening the corporate term.
- Sections 137-138 cover withdrawal of dissolution requests and grounds for involuntary dissolution.
- Section 139 provides for a 3-year winding up period after dissolution.

FOREIGN CORPORATIONS

- Section 140 defines foreign corporations allowed to do business in the Philippines.
- Sections 141-153 cover licensing requirements, filings, sanctions, and withdrawal.

INVESTIGATIONS, OFFENSES, PENALTIES

- Sections 154-157 give the Commission investigation and contempt powers.
- Section 158 allows the Commission to impose administrative sanctions.
- Sections 159-170 define offenses like unauthorized corporate name use, violations by directors/officers, false reports, fraud, and graft/corruption.
- Sections 171-172 cover liability of officers/employees and those aiding violations.

MISCELLANEOUS PROVISIONS

- Section 173 defines outstanding capital stock.
- Section 174 allows designating governing boards by other names.
- Section 175 authorizes the Commission to collect and retain fees.
- Section 176 allows limits on stock ownership in corporations of public interest.
- Section 177 requires annual financial statements and general information sheets.
- Section 178 gives the Commission visitorial powers over corporations.
- Section 179 lists the Commission's powers and functions.
- Section 180 requires an electronic filing and monitoring system.
- Section 181 allows arbitration clauses in corporate documents.
- Section 182 transfers jurisdiction over party-list organizations to COMELEC.
- Section 183 states the Code does not amend laws on special corporations.
- Section 184 preserves rights and liabilities after dissolution or amendment.
- Section 185 gives existing corporations 2 years to comply with new requirements.
- Sections 186-188 cover separability, repealing of the old Corporation Code, and effectivity.