Atty. Nestor H. Santana

November 17, 1982 Atty. Nestor H. Santana 103 Midland Mansions Pasay Road, Legaspi Village Makati, Metro Manila Sir : This has reference to your letter dated October 30, 1982, regarding certain conditions imposed by the Board of Directors of Philippine Overseas Drilling and Oil Development Corporation (PHILODRILL) as contained in the "Notice of Annual Meeting of Stockholders" dated September 27, 1982, quoted hereunder. LexLib "For the purposes of the meeting, only stockholders of record at the close of business on October 8, 1982, and who are actually stockholders on November 17th, the day of the meeting, will be entitled to vote thereat." You are of the opinion that the clause "and who are actually stockholders on November 17th, the day of the meeting" should be deleted so that no holder of shares of stock will be prevented from being represented and voted at the stockholders' meeting since the qualification will be limited to stockholders of record at the close of business on October 8, 1982. All shares sold between October 9 to November 17th will be eligible to be represented and voted by the stockholders of record on October 8, 1982 and the purchasers thereof who have knowledge of this condition are deemed to have appointed the said stockholders as their proxies at the annual meeting of stockholders. In reply thereto, please be informed that the pertinent provision of Sec. 24 of the Corporation Code provides, thus: "SECTION 24. Election of Directors or Trustees . ...In stock corporations every stockholder entitled to vote shall have the right to vote in person or by proxy the number of share of stock standing at the time fixed in the by-laws in his own name on the stock books of the corporation, or where the by-laws are silent, at the time of the election. ..Provided, that the total number of votes cast by him shall not exceed the number of shares owned by him as shown in the books of the corporation multiplied by the whole number of directors to be elected. Provided, however, that no delinquent stock shall be voted ..." (Emphasis supplied) Your approved by-laws, specifically, the last paragraph of Section 2 of Article V provides, and we quote: "Said book shall be closed five days before each meeting of the stockholders, and during such period no stock may be transferred." Taking into consideration the aforequoted provision, it follows that only stockholders of record as of November 12, 1982, which is five (5) days before the meeting of November 17, 1982, shall have the right to vote in person or by proxy. LibLex Please be guided accordingly. Very truly yours, (SGD.) JULIO A. SULIT, JR. Associate Commissioner