Article 26p. 26

COMMERCIAL LAWS NEGOTIABLE INSTRUMENTS, CORPORATION, INSURANCE, TRANSPORTATION, BANKING

even

if

the

meeting

be

improperly

held

or

called,

provided

all

the

stockholders

or

members

of

the

corporation

are

present

or

duly

represented at the

meeting. (24 and 25)

SECTION

52.

Quorum

in

Meetings .

—

Unless

otherwise provided for in this Code or in the bylaws, a

quorum shall consist of the stockholders representing a

majority of the outstanding capital stock or a majority of

the members in case of non-stock corporations. (n)

SECTION

53.

Regular

and

Special

Meetings

of

Directors or Trustees . — Regular meetings of the board

of directors or trustees of every corporation shall be held

monthly, unless the bylaws provide otherwise.

Special meetings of the board of directors or trustees

may be held at any time upon the call of the president or

as provided in the bylaws.

Meetings of directors or trustees of corporations may

be held anywhere in or outside of the Philippines, unless

the bylaws provide otherwise. Notice of regular or special

meetings stating the date, time and place of the meeting

must be sent to every director or trustee at least one (1)

day prior to the scheduled meeting, unless otherwise

provided by the bylaws. A director or trustee may waive

this requirement, either expressly or impliedly. (n)

SECTION 54. Who Shall Preside at Meetings . — The

president shall preside at all meetings of the directors or

trustees as well as of the stockholders or members, unless

the bylaws provide otherwise. (n)

SECTION 55. Right to Vote of Pledgors , Mortgagors ,

and Administrators . — In case of pledged or mortgaged

shares in stock corporations, the pledgor or mortgagor

shall have the right to attend and vote at meetings of

stockholders,

unless

the

pledgee

or

mortgagee

is

expressly given such right in writing which is recorded on

the

appropriate

corporate

books

by the pledgor or

mortgagor. (n)

Executors, administrators, receivers, and other legal

representatives duly appointed by the court may attend

and vote in behalf of the stockholders or members

without need of any written proxy. (27a)

SECTION 56. Voting in Case of Joint Ownership of

Stock . — In case of shares of stock owned jointly by two or

more persons, in order to vote the same, the consent of all

the co-owners shall be necessary, unless there is a written

proxy, signed by all the co-owners, authorizing one or

some of them or any other person to vote such share or

shares: Provided , That when the shares are owned in an

"and/or" capacity by the holders thereof, any one of the

joint owners can vote said shares or appoint a proxy

therefor. (n)

SECTION 57. Voting Right for Treasury Shares . —

Treasury shares shall have no voting right as long as such

stock remains in the Treasury. (n)

SECTION 58. Proxies . — Stockholders and members

may vote in person or by proxy in all meetings of

stockholders or members. Proxies shall be in writing,

signed by the stockholder or member and filed before

the scheduled meeting with the corporate secretary.

Unless otherwise provided in the proxy, it shall be valid

only for the meeting for which it is intended. No proxy

shall be valid and effective for a period longer than five (5)

years at any one time. (n)

SECTION

59.

Voting

Trusts .

—

One

or

more

stockholders of a stock corporation may create a voting

trust for the purpose of conferring upon a trustee or

trustees the right to vote and other rights pertaining to

the shares for a period not exceeding five (5) years at any

one time: Provided , That in the case of a voting trust

specifically required as a condition in a loan agreement,

said voting trust may be for a period exceeding five (5)

years but shall automatically expire upon full payment of

the loan. A voting trust agreement must be in writing and

notarized, and shall specify the terms and conditions

thereof. A certified copy of such agreement shall be filed

with

the

corporation

and

with

the

Securities

and

Exchange

Commission;

otherwise

said

agreement is

ineffective

and

unenforceable.

The

certificate

or

certificates

of

stock

covered

by

the

voting

trust

agreement shall be cancelled and new ones shall be

issued in the name of the trustee or trustees stating that

they are issued pursuant to said agreement. In the books

of the corporation, it shall be noted that the transfer in

the name of the trustee or trustees is made pursuant to

said voting trust agreement.

The trustee or trustees shall execute and deliver to

the transferors voting trust certificates, which shall be

transferable in the same manner and with the same

effect as certificates of stock.

The voting trust agreement filed with the corporation

shall be subject to examination by any stockholder of the

corporation in the same manner as any other corporate

book or record: Provided , That both the transferor and the

trustee or trustees may exercise the right of inspection of

all corporate books and records in accordance with the

provisions of this Code.

Any other stockholder may transfer his shares to the

same trustee or trustees upon the terms and conditions

stated in the voting trust agreement, and thereupon shall

be bound by all the provisions of said agreement.

No voting trust agreement shall be entered into for

the

purpose

of

circumventing

the

law

against

monopolies and illegal combinations in restraint of trade

or used for purposes of fraud.

Unless expressly renewed, all rights granted in a

voting trust agreement shall automatically expire at the

end of the agreed period, and the voting trust certificates

as well as the certificates of stock in the name of the

trustee or trustees shall thereby be deemed cancelled

and new certificates of stock shall be reissued in the

name of the transferors.

The voting trustee or trustees may vote by proxy

unless the agreement provides otherwise. (36a)

TITLE VII Stocks and Stockholders

SECTION 60. Subscription Contract . — Any contract

for the acquisition of unissued stock in an existing

corporation or a corporation still to be formed shall be

deemed a subscription within the meaning of this Title,

notwithstanding the fact that the parties refer to it as a

purchase or some other contract. (n)

SECTION 61. Pre-Incorporation Subscription . — A

subscription for shares of stock of a corporation still to be

formed shall be irrevocable for a period of at least six (6)

months from the date of subscription, unless all of the

other subscribers consent to the revocation, or unless the

incorporation

of

said

corporation fails to materialize

within said period or within a longer period as may be

stipulated in the contract of subscription: Provided , That

no pre-incorporation subscription may be revoked after

the submission of the articles of incorporation to the

Securities and Exchange Commission. (n)

SECTION 62. Consideration for Stocks . — Stocks shall

not be issued for a consideration less than the par or

issued price thereof. Consideration for the issuance of

stock may be any or a combination of any two or more of

the following:

1. Actual cash paid to the corporation;

2. Property, tangible or intangible, actually received

by the corporation and necessary or convenient for its use

and lawful purposes at a fair valuation equal to the par or

issued value of the stock issued;

3. Labor performed for or services actually rendered

to the corporation;

4.

Previously

incurred

indebtedness

of

the

corporation;

5. Amounts transferred from unrestricted retained

earnings to stated capital; and

© Compiled by RGL

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