Mr. F. Ben Reyes

April 30, 2001 MR. F. BEN REYES President RP Enterprises Inc. Suite 219, Bank of P.I. Condominium Plaza Cervantes, Binondo, Manila, 1006 Dear Mr. Reyes, This is in reply to your letter dated January 09, 2001 inquiring about the functions of an ex-officio/honorary director and whether such director can vote in the adoption of resolutions, or object/sponsor motions or engage in debate or argument. An ex-officio director is not allowed in this jurisdiction considering that Section 23 of the Corporation Code requires that the board of directors are to be elected by the stockholders/members of a corporation. Section 23 of the Corporation Code thus provides: "Sec. 23. The Board of directors or trustees Unless otherwise provided in this Code, the corporate powers of all corporation formed under this Code shall be exercised, all business conducted and all property of such corporations controlled and held by the board of directors or trustees to be elected from among the holders of stocks, . . ." Besides, the Corporation Code does not provide for the office of an ex-officio director. (Lopez, Corporation C od e of the Philippines, p. 386) The term ex-officio director means a person who becomes director of a corporation because of his title to an office, and not because of an election by the stockholders or members. (SEC Opinion dated Oct. 29, 1985, addressed to Phil. Social Science Council, Inc.) Nevertheless, the SEC, in some instances, allowed as an exception a provision in the by-laws appointing an "ex-officio" member of the board provided that there is an apprise provision therein that the appointee shall have no voting rights. Thus, the status of an "ex-officio" member of the board is only an honorary member whose role would be only to act as adviser during the meeting. (supra, citing SEC Opinions dtd. Oct. 23, 1989, Atty. Jose P. Garcia and Sept. 1, 1987, Dr. Natividad Puertallano, p. 386) Very truly yours, (SGD.) FE ELOISA C. GLORIA Commissioner