Corporation Law of the Republic of Panama

Law 32 of February 26, 1927

CHAPTER V:

Board of Directors

ARTICLE 49. The business of every corporation shall be managed by a Board of Directors composed of not less than three directors, all of whom shall be male or female persons of legal age.

ARTICLE 50. Subject to the provisions of this law and of the articles of incorporation, the Board of Directors of every corporation shall have absolute control over and full direction of the affairs of the corporation.

ARTICLE 51. The Board of Directors may exercise all of the powers of the corporation except such powers that are by law, the articles of incorporation or by the by-laws, conferred upon or reserved to the stockholders.

ARTICLE 52. Subject to the provisions of this law and the articles of incorporation, the number of Directors shall be fixed by the by-laws of the corporation.

ARTICLE 53. A majority of the Board of Directors of a corporation at a meeting duly assembled shall be necessary to constitute a quorum for the transaction of business. However, the articles of incorporation may provide that a certain number of the directors, whether more or less than a majority, shall be sufficient to constitute a quorum.

ARTICLE 54. The act of a majority of the directors present at a meeting at which a quorum is present shall be the act of the Board of Directors.

ARTICLE 55. Unless otherwise provided in the articles of incorporation, no director need be a stockholder.

ARTICLE 56. The directors may make, alter, amend and repeal the by-laws of the corporation, unless otherwise provided by the articles of incorporation, or in the by-laws adopted by the stockholders.

ARTICLE 57. The directors of every corporation shall be chosen at the time and place and in the manner provided for by the articles of incorporation or by-laws.

ARTICLE 58. Vacancies in the Board of Directors shall be filled in the manner prescribed by the articles of incorporation or by-laws.

ARTICLE 59. Subject to the provisions contained in the two foregoing articles, vacancies, whether resulting from an increase in the authorized number of directors or otherwise, may be filled by the vote of a majority of the directors then in office.

ARTICLE 60. If the directors are not elected by the specific day designated for that purpose, the directors then in office shall continue to hold their offices and discharge their duties until their respective successors shall have been elected.

ARTICLE 61. Unless otherwise provided in the articles of incorporation or in the by-laws, the Board of Directors may appoint two or more of their number to constitute a committee or committees, who shall have and exercise the powers of the Board of Directors in the management of the business affairs of the corporation to the extent and subject to the restrictions expressed in the articles of incorporation, the by-laws, or the resolutions appointing such committees.

ARTICLE 62. If the articles of incorporation so provide, at any meeting of the directors, any director may be represented and vote by proxy or proxies (who need not be directors), appointed by an instrument in writing, public or private, with or without power of substitution.

ARTICLE 63. Directors may be removed at any time by the vote of holders of a majority of the outstanding shares entitled to vote for directors. Officers, agents and employees may be removed at any time by resolution adopted by a majority of the directors, or in such a manner as the articles of incorporation or by-laws provide.

ARTICLE 64. If any dividend or distribution of assets be declared or paid which reduces the value of the assets of the corporation remaining after the payment of such dividend or such distribution, as the case may be, to less than the aggregate amount of its debts and liabilities, including capital stock, or if a reduction of capital stock be made, except in accordance with the provisions of this law, or if any report or statements be made which shall be false in any material representation, the directors of the corporation who assent thereto with knowledge of the impairment of the capital stock or of such falsity, as the case may be, shall be jointly and severally liable to the creditors of the corporation for any loss or damage arising therefrom.