Articles of Incorporation for a Close Corporation in the Philippines serve as the primary constitutional document for businesses seeking to incorporate as a closely-held entity. This document type is particularly suitable for family businesses, professional practices, and small to medium-sized enterprises that wish to maintain tight control over ownership and management. It must comply with the Revised Corporation Code of the Philippines, specifically Title XIII governing Close Corporations, and SEC regulations. The document establishes the corporation's legal existence, sets out its basic structure, governance framework, and includes specific provisions restricting share transfers and ownership. It's typically used when incorporating a business with a limited number of shareholders (not exceeding 20) who wish to maintain close control over the company's ownership and management. The document must be filed with the SEC and includes crucial information about capital structure, corporate purpose, and management arrangements.
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1. Article I - Corporate Name: States the complete corporate name that has been approved by the SEC
2. Article II - Purpose Clause: Details the primary and secondary purposes of the corporation
3. Article III - Principal Office: Specifies the complete address of the corporation's principal office
4. Article IV - Term of Existence: States the duration of corporate existence (perpetual unless specified otherwise)
5. Article V - Founders and Directors: Names and addresses of the original founders/stockholders and initial board of directors
6. Article VI - Capital Structure: Details of authorized capital stock, par value, and classes of shares
7. Article VII - Subscription and Payment: Information about share subscriptions and payments by the incorporating stockholders
8. Article VIII - Close Corporation Requirements: Specific provisions identifying the entity as a close corporation and restrictions on share transfers
9. Article IX - Corporate Officers: Designation of required officers and their roles
10. Article X - Fiscal Year: Specification of the corporation's fiscal year
1. Article on Preemptive Rights: Include when stockholders are to be given preemptive rights to subscribe to additional share issuances
2. Article on Foreign Ownership Limitations: Required when the corporation operates in a nationality-restricted industry
3. Article on Arbitration: Include when shareholders want to specify alternative dispute resolution mechanisms
4. Article on Stockholders' Agreement: Include when incorporating an existing stockholders' agreement into the Articles
5. Article on Special Corporate Powers: Include when the corporation needs specific powers beyond standard corporate powers
1. Schedule A - Share Subscription Details: Detailed breakdown of share subscriptions by each incorporating stockholder
2. Schedule B - Secondary Purposes: Detailed list of secondary business purposes if not fully contained in main document
3. Schedule C - List of Assets: If assets are being transferred to the corporation upon incorporation
4. Appendix 1 - Treasurer's Affidavit: Sworn statement regarding the payment and custody of capital stock subscription
5. Appendix 2 - Authority to Verify Bank Account: Authorization for SEC to verify paid-up capital in bank
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