Practice question
The articles contain no authority for the board to set preferred-share terms. Directors nevertheless invent a new preference and file a certificate, saying filing alone supplies the missing articles authorization. Which is correct?
- Filing automatically amends every article
- No articles authorization is needed in any case
- The directors may grant any secret preference
- Section 6 requires articles authorization for the board’s power as well as the specified filing; one does not replace the other.
- Only the preference’s name matters
Legal references
- Revised Corporation Code, RA 11232, Sections 3 and 6: https://lawphil.net/statutes/repacts/ra2019/ra_11232_2019.html
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