All stockholders of a stock corporation shall enjoy preemptive right to subscribe to all issues or disposition of shares of any class, in proportion to their respective shareholdings. This is also called the “right of first refusal”.
Such preemptive right shall not extend to the following:
- (a) shares issued in compliance with laws requiring stock offerings or minimum stock ownership by the public; or
- to shares issued in good faith with the approval of the stockholders representing 2/3 of the outstanding capital stock, in exchange for property needed for corporate purposes or in payment of a previously contracted debt.
The articles of incorporation, or an amendment thereto, may remove or deny pre-emptive rights.
[For the preemptive rights for close corporations, see Close Corporations in the Philippines: The Revised Corporation Code.]