December 12, 1994

Mr. Greg Z.M. Maligaya

Pryce Properties Corporation
8th Flr., BPI Paseo de Roxas Condominium Center,
8753 Paseo de Roxas, Makati, M.M.
Sir:
This refers to your letter requesting opinion on the correctness of the view
that pre-emptive right of stockholders of good standing can be waived by the
corporation itself through a stockholders resolution.
The pertinent provision of the Corporation Code provides:
"SECTION 39.
Power to deny pre-emptive right. All stockholders
of a stock corporation shall enjoy pre-emptive right to subscribe to all issues
or disposition of shares of any class, in proportion to their respective
shareholdings, unless such right is denied by the articles of incorporation or
an 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
(2/3) of the outstanding capital stock, in exchange for property needed for
corporate purposes or in payment of a previously contracted debt."
(Emphasis supplied)
Thus, unless specifically denied in the articles of incorporation or the issuance
fall under any of the exceptions enumerated in the above provision, all stockholders
of records shall have the pre-emptive right to subscribe to additional issuances of
shares. Accordingly, waiver of such right by all non-subscribing stockholders is
necessary. Being a personal right, such waiver should be given individually by the
non-subscribing stockholders concerned. (SEC Letter dated October 1, 1981
addressed to Mr. Fernando C. Santico) For purposes of compliance, any evidence of
the required waiver is acceptable to the SEC.

Very truly yours,

(SGD.) FE ELOISA C.
GLORIA
Associate Commissioner