SUMMARY OF THE SECURITIES REGULATION CODE (R.A.
8799)
The Securities Regulation Code is considered among the “Blue Sky Law”
as it aims to protect the public against the imposition of unsubstantial
schemes and the securities based thereon. As a “Blue Sky Law” the given
law indicates the evil against which it is directed, namely speculative
schemes which have no more basis than a few feet of the blue sky.
What are securities?
Securities are shares or interest in a corporation that raises the more capital
for the profit-making of the businesses. These securities include:
Shares of stocks, bond, debentures
Investment contracts (interest, participation in a profit sharing)
Derivatives (option and warrants)
Certificates (participation, trust, assignment)
Propriety or non-propriety membership certificates
Tender Offers
Tender Offer is a publicly announced intention by a person acting alone or in
concert with others (hereinafter referred to as “person”) to acquire
outstanding equity securities of a public company.
Public Company
o Any corporation with a class of equity securities listed on an
exchange, or with assets in excess of 50,000,000 and has 200 or
more holders, at least 200 of which hold at least 100 shares of a
class of its equity securities.
a. Any person or group of persons acting in concert who intends to
acquire at least 15% of any class of any equity security of a listed
corporation with assets of at least 50,000,000 and having 200 or more
stockholders with at least 100 shares each who intends to acquire at
least 35% of such equity over a period of 12 months shall make
a tender offer to stockholders by filling with the Commission a
declaration to that effect: and furnish the issuer, a statement
containing such of the information required in Section 17 of this code
as the Commission may prescribe. Such person shall publish all
requests or tender offer requesting such tender offers subsequent to
the initial solicitation or request shall contain such information as the
Commission may prescribe, and shall be filed with the Commission and
sent to the issuer not alter than the time copies of such material are
first published or given to security holders.
b. Any solicitation or recommendations to the holders of such security
to accept or reject a tender offer or invitations for tenders shall be
made in accordance with such rules and regulations as the
Commission may prescribe.
c. Securities deposited pursuant to the tender offer or invitations may be
withdrawn by or on behalf of the depositor at any time throughout the
period that the tender offer remains open and if the securities
deposited have not been previously accepted for payment, and at any
time after 60 days from the original tender offer or request or
invitation, except as the Commission may otherwise prescribe.
d. Where the securities offered exceed that which a person or group of
persons is bound or willing to take up and pay for, the securities that
are subject of the tender offer shall be taken up as nearly as may be
pro rata, disregarding fractions, according to the number of securities
deposited by each depositor. The provisions of this subsection shall
also apply to the securities deposited within 10 days after the notice
of an increase of the consideration offered to security holders, as
described in paragraph (e) of this subsection, is first published or sent
or given to security holders.
e. Where any person varies the terms of a tender offer or request or
invitation for tenders before the expiration thereof by increasing the
consideration offered to holders of such securities, such person shall
pay the increased consideration to each security holder whose
securities are taken up and paid for whether or not such securities
have been taken up by such person before the variation of the tender
offer or request or invitation.
19.2. It shall be unlawful for any person to make any untrue
statement of a material fact or omit to state any material fact
necessary in order to make the statements made, in the light of the
circumstances under which they are made, not misleading, or to
engage in any fraudulent, deceptive, or manipulative acts or practices,
in connection with any tender offer or request or invitation for tenders,
or any solicitation of security holders in opposition to or in favor of any
such offer, request, or invitation. The Commission shall, for the
purposes of this subsection, define and prescribe means reasonably
designed to prevent, such acts and practices as are fraudulent,
deceptive, or manipulative.