Ratified by at Least2

7/27/2019 Ratified by at Least2

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Ratified by atleast2/3 of the

OCSS E C I N TE R I M GUIDELIN

ESCorporation must

have:


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Minimum net

worthof P25 Mat the time of the

filing of theapplication

H a v e b e e n i noperat ion for at l

east 3 years


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Must fulfill

financialratio mandated bySEC in

interimguidelinesrequired:1)trust indenturewith a trusteebank2)underwritingagreeme

nt


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Bonds registered

with theSECPower to sell,

dispose,lease, encumber (Sec.40)ALL

Quantitative TestS

UBSTANTIALLYALL


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Qua l i t a t i ve Tes t (purpose for w

hich itwasincorporated)1 )O f a l l o r s

ubstantially all of its property


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Majority vote of

Board of Directors( m a j o r i t y o f

quorum)

R a t i f i e d o r a

pproved by 2/3of the OCS or

2/3 of themembers


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Re la tes t o t heprimary

purpose.2)Exception to Sec.40 if the sale

isnecessary in theusual and regu

larcourse of businessor if proceed


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s of the sale or

otherdisposition of suchproperty and

assetsbeappropriatedforthe conduct ofitsremainingbusinesses


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Majority vote of

Board of Directors(business

judgmentrule

Does not relate t

op r i m a r y o r secondary

purpose( 1 ) M u s


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t comply with

theBulk Sales Law

L i s t i n g t h e corporate creditorsand the amount

and nature oftheirclaims


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Fai lure renderst

ransactionvoid(2) If no ratifi

catoryvote ofstockholders, itisan utra vires actof the thirdkind Yes, such a

sale doesnotnecessarily leas


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toa dissolution of

thecorporation andreturnof the

residual valueof the corporation.Such isafforded asa matter of equityand

fairness.Power topurchase


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ownshares (Sec.

41)Buy back ofshares

(i)decrease the cost of doing business (ii)perpetuate control of theenterprise.


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Must be for a

legitimate purpose

example:(1)eliminate fractionalshares arisingoutof stockdividends(2)coll

e c t o r c o m p r omise anindebte


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dness to the cor

porationarisingout of unpaid

subscription inadelinquency sale, and to purchasedelinquent sharesduring said sale

and(3)to pay dis


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senting or withdr

awingNone


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Revised BagtasReviewer by Veand

Ocfe 2Astockholders exercising th

eirappraisal right

Taken from

URE only exceptredeemableshares


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P o w e r t o i n v e

s t corporate funds inanother

corporationorbusiness or foranyother purpos

e (Sec.42)

Approved by amajority vote of t


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h e B o a r d o f D

irectors (majorityofquorum)

Ratified by atleast2/3 of the

OCS

As a generalrule,section 42


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appliesif the inves

tmentis forsecondary

orother than theprimary purpose.

E x c e p t i f t h e inves tmen t is re

asonablynecessa r y t o accompli


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sh i tsprimary pur

poseas stated intheA r t i c l e s o

f Incorporation,approval of thestockholders isnotnecessary as itisincluded in th

eBusinessJudgmento f B o


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a r d o f Director

s

Written notice oft h e p r o p o s e d investment andth

e time andplaceof meeting s

hallbe addressedtoeach stockhold


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eror member at

hisplace ofresidenceas sho

wn in theb o o k sof thecorpora t

ion anddepositedto theaddressee

in thePost Office

withpostageprepaid orserved


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personally. Yes, b

ecause minustheratificatory votet

h e c o n t r a c t o r transaction fallsunderthe realmof ul travires transactions of the

thirdtype.Power to d


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eclaredividends

(Sec. 43)

Cashdividends(1)Absolutemajor i t y o f B

o a r d o f Directors


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inaccordancew i t

h t h e BusinessJudgment Rule(2)

Only declaredoutof the UREwhich shallbepayable in cash,inproperty or in

stock(3) However, cashdividend


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s due ondelinqu

ent sharesshallbe first appliedto

the unpaidbalancewhile stock dividendsshallbe withhelduntilfully paid

Stock dividends


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approval of 2/3of

Sec. 43 prohibitsstock corporationf

rom retain ingsurplus profits inexcess of 100%of t he i r pa id -


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up capi ta l s tock

,EXCEPT:(1) When justi f ied byd

efinitecorporateexpansionprojectso rprograms asapproved bytheBoard of Director

s(2) Whencorporationis pro


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hibited underany

loan agreementfr o m d e c l a r i n g

dividends withoutitsconsent andsuch Yes.113


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t h e O C S a ta regular or specialmeeting called f

orthatpurpose.consent

has not yetbeensecuredor(3) When i t ca

n beclearly shownthat


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suchretention is n

ecessaryu n d e rs p e c i a l circumst

ancesobtainingi n t h e corporation such aswhenthere is needforspecial reser

ve forprofitablecontingencies.Powe


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r to enter intoma

nagementcontracts(Sec. 44)

Approved byabsolute majority

of the BoardofDirectors


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Approved by

stockholdersowning majority

of theOCSHOWEVERwhere:(1)Stockholdersrepresenting the

same interestofboth managing


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and the managed

corporationown orcontrol more than

1/3 of the totalOCSentitled tovote of themanagingcorporation

OR(2) Where a majority of the me


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mbers of theBoar

d of Directors ofthe managing

corporationalsoconstitute amajority of themembers oftheBoard of

Directors of themanaged


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corporation. Then

it must beapproved by the

stockholders of themanagedcorporationowning at least2/3 of the

OCSEXCEPT ifthe corporation is


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organized

primarilyasmanagement

company.

Not for a period

longer than fiveyears for anyone

term.


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Documents

Ratified by at Least2