Document background
The Preference Shares Agreement is a crucial document for Philippine companies seeking to raise capital while maintaining existing voting control structures. This agreement is particularly utilized when companies need to attract investors by offering preferential dividend rights and other financial preferences without diluting management control. The document must comply with the Revised Corporation Code of the Philippines, Securities Regulation Code, and various SEC regulations. It typically includes detailed provisions on dividend rights, voting rights, redemption mechanisms, transfer restrictions, and conversion features. The agreement is commonly used in corporate restructuring, expansion projects, or when companies need to improve their capital structure without taking on additional debt. The document requires careful consideration of both corporate law requirements and tax implications under Philippine jurisdiction.
