Mr. Jorge L. Cabildo

February 20, 1992 Mr. Jorge L. Cabildo 7th Floor, Singapore Airlines Building 138 H. V. de la Costa St., Legaspi Village, Makati, Metro Manila S i r : This refers to your letter requesting opinion whether a corporation with more than 200 stockholders whose stock certificates were previously handled by a transfer agent who listed the stockholders in a computerized individual ledger is required to maintain a stock and transfer book after the termination of the services of said transfer agent, or will it just continue with the ledgers. The pertinent provision of the Corporation Code provides: "SECTION 74. Books to be kept ;... Stock corporations must also keep a book to be known as the " stock and transfer book ",in which must be kept a record of all stocks in the names of the stockholders alphabetically arranged; the installments paid and unpaid on all stock for which subscription has been made, and the date of payment of any installment; a statement of every alienation, sale or transfer of stock made, the date thereof, and by and to whom made; and such other entries as the by-laws may prescribe. The stock and transfer book shall be kept in the principal office of the corporation or in the office of its stock transfer agent and shall be open for inspection of any director or stockholder of the corporation at reasonable hours on business days. ..." (Emphasis supplied) LLjur The language of the above-provision is imperative and mandatory for corporations to keep a "stock and transfer book". A corporation may use loose leaf computerized records for stock and transfer book provided the following provisions of the "SEC Rules Requiring The Maintenance Of Stock And Transfer Book/Membership Book And The Preparation Of Annual List of Stockholders/Members (As Amended)" shall be complied with: "5. In the case of corporations which are using loose leaf or computerized records for their stock and transfer book/membership book, such corporations concerned must comply with the requirements under Rules No. 1, 2, 3, and 4 above and also submit certification under oath by the Corporate Secretary or transfer agent stating that they are using loose leaf or computerized records in lieu of formal submission of their stock and transfer records. Within thirty (30) days from the end of the fiscal year, the Secretary of the corporation or transfer agent must submit to the commission a certification under oath stating the kind and number of loose leaf or computerized records used during each fiscal year, as well as the authenticity of the entries made on these records. If for valid reasons acceptable to the Commission additional time is needed, an extension of not exceeding thirty (30) days may be granted, provided a written request is filed on or before the due date and upon payment of an extension fee of Three Hundred (P300.00) Pesos. 6. All the used loose leaf or computerized stock and transfer records of the corporation, including those which were spoiled or canceled must be kept intact and with the proper indexing system in order to facilitate the examination thereof whenever this is called for by this Commission. The Commission may require the corporations concerned to submit reports from time to time covering their loose leaf or computerized stock and transfer records as the need arises. 7. The stock and transfer book/membership book or its equivalent must be preserved and shall form part of the records of the corporation." Please be advised accordingly. Very truly yours, (SGD.) ROSARIO N. LOPEZ Chairman