THE
CORPORATION CODE
OF THE
PHILIPPINES
[Batas Pambansa Blg. 68]
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TITLE XIV
DISSOLUTION
Sec. 117. Methods of dissolution. -
A corporation formed or organized under the provisions of this Code may be
dissolved voluntarily or involuntarily. (n)
Sec. 118. Voluntary dissolution where no
creditors are affected. - If dissolution of a corporation does
not prejudice the rights of any creditor having a claim against it, the
dissolution may be effected by majority vote of the board of directors or
trustees, and by a resolution duly adopted by the affirmative vote of the
stockholders owning at least two-thirds (2/3) of the outstanding capital
stock or of at least two-thirds (2/3) of the members of a meeting to be held
upon call of the directors or trustees after publication of the notice of
time, place and object of the meeting for three (3) consecutive weeks in a
newspaper published in the place where the principal office of said
corporation is located; and if no newspaper is published in such place, then
in a newspaper of general circulation in the Philippines, after sending such
notice to each stockholder or member either by registered mail or by personal
delivery at least thirty (30) days prior to said meeting. A copy of the
resolution authorizing the dissolution shall be certified by a majority of
the board of directors or trustees and countersigned by the secretary of the
corporation. The Securities and Exchange Commission shall thereupon issue the
certificate of dissolution. (62a)
Sec. 119. Voluntary dissolution where creditors
are affected. - Where the dissolution of a corporation may
prejudice the rights of any creditor, the petition for dissolution shall be
filed with the Securities and Exchange Commission. The petition shall be
signed by a majority of its board of directors or trustees or other officers
having the management of its affairs, verified by its president or secretary
or one of its directors or trustees, and shall set forth all claims and
demands against it, and that its dissolution was resolved upon by the
affirmative vote of the stockholders representing at least two-thirds (2/3)
of the outstanding capital stock or by at least two-thirds (2/3) of the
members at a meeting of its stockholders or members called for that purpose.
If the petition is sufficient in form and substance, the
Commission shall, by an order reciting the purpose of the petition, fix a
date on or before which objections thereto may be filed by any person, which
date shall not be less than thirty (30) days nor more than sixty (60) days
after the entry of the order. Before such date, a copy of the order shall be
published at least once a week for three (3) consecutive weeks in a newspaper
of general circulation published in the municipality or city where the
principal office of the corporation is situated, or if there be no such
newspaper, then in a newspaper of general circulation in the Philippines, and
a similar copy shall be posted for three (3) consecutive weeks in three (3)
public places in such municipality or city.
Upon five (5) day's notice, given after the date on which
the right to file objections as fixed in the order has expired, the
Commission shall proceed to hear the petition and try any issue made by the
objections filed; and if no such objection is sufficient, and the material
allegations of the petition are true, it shall render judgment dissolving the
corporation and directing such disposition of its assets as justice requires,
and may appoint a receiver to collect such assets and pay the debts of the
corporation. (Rule 104, RCa)
Sec. 120. Dissolution by shortening corporate
term. - A voluntary dissolution may be effected by amending the
articles of incorporation to shorten the corporate term pursuant to the
provisions of this Code. A copy of the amended articles of incorporation
shall be submitted to the Securities and Exchange Commission in accordance
with this Code. Upon approval of the amended articles of incorporation of the
expiration of the shortened term, as the case may be, the corporation shall
be deemed dissolved without any further proceedings, subject to the
provisions of this Code on liquidation. (n)
Sec. 121. Involuntary dissolution. -
A corporation may be dissolved by the Securities and Exchange Commission upon
filing of a verified complaint and after proper notice and hearing on the
grounds provided by existing laws, rules and regulations. (n)
Sec. 122. Corporate liquidation. -
Every corporation whose charter expires by its own limitation or is annulled
by forfeiture or otherwise, or whose corporate existence for other purposes
is terminated in any other manner, shall nevertheless be continued as a body
corporate for three (3) years after the time when it would have been so
dissolved, for the purpose of prosecuting and defending suits by or against
it and enabling it to settle and close its affairs, to dispose of and convey
its property and to distribute its assets, but not for the purpose of
continuing the business for which it was established.
At any time during said three (3) years, the corporation
is authorized and empowered to convey all of its property to trustees for the
benefit of stockholders, members, creditors, and other persons in interest.
From and after any such conveyance by the corporation of its property in
trust for the benefit of its stockholders, members, creditors and others in
interest, all interest which the corporation had in the property terminates,
the legal interest vests in the trustees, and the beneficial interest in the
stockholders, members, creditors or other persons in interest.
Upon the winding up of the corporate affairs, any asset
distributable to any creditor or stockholder or member who is unknown or
cannot be found shall be escheated to the city or municipality where such
assets are located.
Except by decrease of capital stock and as otherwise
allowed by this Code, no corporation shall distribute any of its assets or
property except upon lawful dissolution and after payment of all its debts
and liabilities. (77a, 89a, 16a)
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