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ALL
stockholders have preemptive rights unless there is a
specific denial of this right in the articles of
incorporation or an amendment thereto. A preemptive
right is the right to subscribe to the capital stock of
the corporation. The Articles of Incorporation may lay
down the specific rights and powers of shareholders with
respect to the particular shares they hold, all of which
are protected by law so long as they are not in conflict
with the Corporation Code (SEC Memorandum Circular
02-02, V. 2).
Section
39 of the Corporation Code provides that all
stockholders of a stock corporation shall enjoy
preemptive right to subscribe to all issues or
disposition of shares of any class, in proportion to
their respective share holdings, unless such right is
denied by the articles of incorporation or any amendment
thereto. Provided, that such pre-emptive right shall not
extend to shares to be issued in compliance with laws
requiring stock offerings or minimum stock ownership by
the public; or to shares to be issued in good faith with
the approval of the stockholders representing two-thirds
of the outstanding capital stock, in exchange for
property needed for corporate purposes or in payment of
a previously contracted debt (SEC Opinion dated March
23, 1998).
Preemptive right is recognized with respect to new
issues of shares and to additional issues of originally
authorized shares. This is on the theory that when a
corporation at its first inception offers its first
shares, it is presumed to have offered all of those that
it is authorized to issue. An original subscriber is
deemed to have taken his shares knowing that they form a
definite proportionate part of the whole number of
authorized shares. When the shares left unsubscribed are
later reoffered, he cannot therefore claim dilution of
interest (SEC Opinion 03-05 citing Benito v. SEC, July
25, 1983, 123 SCRA 722, 726).
The
adoption of a procedure of notifying the stockholders of
their preemptive right to subscribe may be left to the
decision of the Board of Directors, provided that a
reasonable time within which to exercise the right,
should be given to the stockholders (Decasa, SEC
Opinions, p. 42 citing SEC letter to lawyer Aaron B.
Bautista dated July 28, 1994). However, if the shares
corresponding to one stockholder are not subscribed or
purchased by him, it is not necessary that said shares
should again be offered on a pro-rata basis to the
stockholders who took advantage of their right of
preemption. This is because for as long as they exercise
their preemptive rights, their relative and
proportionate voting strength in the corporation will
not be affected adversely (ibid).
The
shares may also be offered to non-stockholders of record
on a first come first serve basis without violating the
preemptive rights of the stockholders. However, the
Commission considers it a sound corporate practice to
always offer the remaining shares to interested
stockholders of record whenever practical and feasible
before offering them to outside third parties (SEC
Opinion dated December 6, 1994). Being a personal right,
the waiver of pre-emptive right should be given
individually by all nonsubscribing stockholders or by an
authorized person by way of a special power of attorney
(ibid). |
