Espinos Agro-Industrial Corporation

October 20, 1982 Espinos Agro-Industrial Corporation c/o Mr. Ambrosio Reyes 22 Tirad Pass St., S.M.H. Quezon City Gentlemen: This pertains to your letter dated September 29, 1982 inquiring whether or not a corporation can act as guarantor for loans of its stockholders and whether the said corporate act may be included in the corporation's secondary purposes. It appears from the facts on record that ESPINOS AGRO-INDUSTRIAL CORPORATION is a duly registered corporation with certificate of registration No. 63921 issued by this Commission on October 8, 1975. Records further show that in paragraph 4 of its Articles of Incorporation, it is specifically provided as one of its secondary purposes that the corporation is authorized to do the following act: "To purchase or otherwise acquire, as a going concern or otherwise, all or any part of the business, goodwill, rights, property, real or personal, and assets of all kinds, and in connection with the acquisition of the same to undertake, assume and guarantee all or any part of the liabilities of any corporation, association, partnership or personal deemed to be of use or benefit to the corporation in any manner in connection with any of its objects or purposes; and to pay for the same in cash and/or stock and/or bonds and/or notes and/or other securities of this corporation and/or otherwise, and to hold, possess, manage, conduct and carry on the whole or any part of the business so acquired, and to pledge, mortgage, sell or otherwise dispose of any business or property so required, in the manner and to the extent now or hereafter authorized or permitted by law." It is evident from the aforequoted secondary purpose of the corporation that it may guarantee or assume the liabilities of any corporation, association partnership, or person, including that of its stockholders, if the same is done in furtherance of the corporate objects and for the benefit of the corporation. Conversely, however, the corporation can not act as guarantor for the personal loans of its stockholders; neither can the same be validated thru the inclusion of such purpose in the Articles of Incorporation of the Corporation. llcd Very truly yours, (SGD.) JULIO A. SULIT, JR. Associate Commissioner