AMENDMENT NO. 1 TO DEPOSIT AGREEMENT
AMENDMENT NO. 1 (the "Amendment") dated as of January , 2003 to the
Common Stock Deposit Agreement dated as of October 19, 1994 (the "Deposit
Agreement") among JPMorgan Chase Bank, as successor depositary, and all holders
from time to time of American Depositary Receipts (the "ADRs") evidencing
American Depositary Shares ("ADSs") representing common stock of Philippine Long
Distance Telephone Company, a corporation organized under the laws of the
Republic of the Philippines, and its successors (the "Company").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, Citibank, N.A. and the holders of ADRs issued under the
Deposit Agreement entered into the Deposit Agreement for the purposes set forth
therein;
WHEREAS, Citibank, N.A. has resigned as depositary under the Deposit
Agreement and the corresponding Common Stock Agreement dated as of October 19,
1994 between Citibank, N.A. and the Company (the "Common Stock Agreement") and
the Company has appointed JPMorgan Chase Bank as successor depositary under the
Deposit Agreement and the Common Stock Agreement;
WHEREAS, JPMorgan Chase Bank has accepted its appointment as successor
depositary (the "Depositary") under the Deposit Agreement and Common Stock
Agreement;
WHEREAS, the Company desires to continue to provide for the deposit of
Common Stock of the Company with the Depositary or the Custodian as agent for
the Depositary and for the execution and delivery of ADRs evidencing ADSs
representing the Common Stock so deposited;
WHEREAS, the Depositary desires to amend and supplement the terms of
the Deposit Agreement and form of ADRs inter alia to reflect the appointment of
JPMorgan Chase Bank as the successor depositary.
NOW, THEREFORE, the Depositary hereby amends and supplements the ADRs
and the Deposit Agreement, effective as of the Effective Date set forth in
Section 4.01 hereof, as follows:
ARTICLE I
DEFINITIONS
Section 1.01. Definitions. All capitalized terms used but which are not
otherwise defined herein shall have the respective meanings given to them in the
Deposit Agreement.
ARTICLE II
AMENDMENT TO DEPOSIT AGREEMENT
Section 2.01. Except with respect to the Custodian, all references in
the Deposit Agreement to "Citibank, N.A." or the "Depositary" shall be
references to "JPMorgan Chase Bank".
Section 2.02. All references in the Deposit Agreement to the "Deposit
Agreement" shall hereby mean the Deposit Agreement, dated as of October 19,
1994, as amended and supplemented by this Agreement and as further amended and
supplemented from time to time.
Section 2.03. Section 1.01 of the Deposit Agreement is amended to read
as follows:
ADRs. The term "ADRs" shall mean the American Depositary
Receipts executed and delivered hereunder. ADRs may be either in
physical certificated form or Direct Registration ADRs. ADRs in
physical certificated form, and the terms and conditions governing
the Direct Registration ADRs (as hereinafter defined), shall be
substantially in the form of Exhibit A annexed hereto (the "form
of ADR"). The term "Direct Registration ADR" means an ADR, the
ownership of which is recorded on the Direct Registration System.
References to "ADRs" shall
2
include certificated ADRs and Direct Registration ADRs, unless the
context otherwise requires. The form of ADR is hereby incorporated
herein and made a part hereof; the provisions of the form of ADR
shall be binding upon the parties hereto.
Section 2.04. Section 1.13 of the Deposit Agreement is amended by
replacing "Citicorp Trade Services, Limited, a corporation organized under the
laws of Hong Kong" with "▇▇▇▇▇▇ & Co."
Section 2.05. The address of the Depositary set forth in Section 1.17
of the Deposit Agreement is amended to read "1 Chase ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇."
Section 2.06. The following new definitions are inserted into Article I
of the Deposit Agreement:
Section 1.21. Deliver, Execute, Issue, Register, Surrender, Transfer
or Cancel . The terms "deliver", "execute", "issue", "register",
"surrender", "transfer" or "cancel", when used with respect to Direct
Registration ADRs, shall refer to an entry or entries or an electronic
transfer or transfers in the Direct Registration System.
Section 1.22. Direct Registration System. The term "Direct
Registration System" means the system for the uncertificated
registration of ownership of securities established by The Depository
Trust & Clearing Corporation ("DTCC") and utilized by the Depositary
pursuant to which the Depositary may record the ownership of ADRs
without the issuance of a certificate, which ownership shall be
evidenced by periodic statements issued by the Depositary to the
Holders entitled thereto. For purposes hereof, the Direct Registration
System shall include access to the Profile Modification System
maintained by DTCC which provides for automated transfer of ownership
between DTCC and the Depositary.
Section 2.07. The first three paragraphs of Section 2.01 of the Deposit
Agreement are hereby amended to read as follows:
ADRs in certificated form shall be engraved, printed or otherwise
reproduced at the discretion of the Depositary in accordance with its
customary practices in its American depositary receipt business, or at
the
3
request of the Company typewritten and photocopied on plain or safety
paper, and shall be substantially in the form set forth in the form of
ADR, with such changes as may be required by the Depositary or the
Company to comply with their obligations hereunder, any applicable
law, regulation or usage or to indicate any special limitations or
restrictions to which any particular ADRs are subject. ADRs may be
issued in denominations of any number of ADSs. ADRs in certificated
form shall be executed by the Depositary by the manual or facsimile
signature of a duly authorized officer of the Depositary. ADRs in
certificated form bearing the facsimile signature of anyone who was at
the time of execution a duly authorized officer of the Depositary
shall bind the Depositary, notwithstanding that such officer has
ceased to hold such office prior to the delivery of such ADRs.
Notwithstanding anything in this Deposit Agreement or in the
form of ADR to the contrary, ADSs shall be evidenced by Direct
Registration ADRs, unless certificated ADRs are specifically requested
by the Holder.
Holders shall be bound by the terms and conditions of this
Deposit Agreement and of the form of ADR, regardless of whether their
ADRs are Direct Registration ADRs or certificated ADRs.
Section 2.08. Section 2.03 of the Deposit Agreement is amended to
include the following at the conclusion thereof:
Notwithstanding anything in this Deposit Agreement to the contrary, to
the extent the Depositary so desires, ADSs shall be evidenced by ADR
reflected on the Direct Registration System unless certificated ADRs
are specifically requested by the Holder. At the request of a Holder,
the Depositary shall, for the purpose of substituting a certificated
ADR with a Direct Registration ADR, or vice versa, execute and deliver
a certificated ADR or a Direct Registration ADR, as the case may be,
for any authorized number of ADSs requested, evidencing the same
aggregate number of ADSs as those evidenced by the certificated ADR or
Direct Registration ADR, as the case may be, substituted.
Section 2.09. Section 2.07 of the Deposit Agreement is amended to read
as follows:
The Depositary shall execute and deliver a new Direct Registration ADR
in exchange and substitution for any mutilated certificated ADR upon
cancellation thereof or in lieu of and in substitution for such
destroyed, lost or stolen certificated ADR, unless the Depositary has
notice that such ADR has been acquired by a bona fide purchaser, upon
the Holder thereof filing
4
with the Depositary a request for such execution and delivery and a
sufficient indemnity bond and satisfying any other reasonable
requirements imposed by the Depositary.
Section 2.10. The following is inserted at the end of the first
paragraph of Section 5.02 of the Deposit Agreement:
In no event shall the Depositary or any of its agents be liable for
any indirect, special, punitive or consequential damages.
Section 2.11. The first two sentences of Section 5.04 of the Deposit
Agreement are amended to read as follows:
The Depositary may at any time resign as Depositary hereunder
by 30 days' written notice of its election so to do to the Company,
such resignation to take effect upon the appointment of a successor
depositary and its acceptance of such appointment as hereinafter
provided. The Depositary may at any time be removed by the Company by
30 days prior written notice of such removal.
In case at any time the Depositary acting hereunder resigns
or is removed, the Company has agreed to use its best efforts to
appoint a successor depositary, which shall be a bank or trust company
having an office in the Borough of Manhattan, The City of New York.
Section 2.12. The address of the Depositary set forth in second
paragraph of Section 7.05 of the Deposit Agreement is amended to read:
JPMorgan ▇▇▇▇▇ ▇▇▇▇, ▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Plaza, 40th Floor, New York,
New York 10081, Attention: ADR Department, Fax: (▇▇▇) ▇▇▇-▇▇▇▇.
ARTICLE III
AMENDMENTS TO FORM OF ADR
Section 3.01. The form of Receipt set forth in Exhibit A to the Deposit
Agreement (the "form of ADR") is amended as provided in this Article.
5
Section 3.02. Except with respect to the Custodian, all references in
the form of ADR to "Citibank, N.A." or the "Depositary" shall be references to
"JPMorgan Chase Bank".
Section 3.03. The initial paragraph of the form of ADR is amended to
read as follows:
JPMORGAN CHASE BANK, a New York corporation, as depositary hereunder
(the "Depositary"), hereby certifies that is the owner of that number
of American Depositary Shares ("ADSs"), indicated on the records of
the Depositary, representing deposited fully paid Common Stock (the
"Common Stock"), including evidence of rights to receive such Common
Stock (including, but not limited to, purchase invoices as may
effectuate the legal transfer of title to shares under Philippine
law), of Philippines Long Distance Telephone Company, a corporation
organized under the laws of the Republic of the Philippines (the
"Company"). At the date of the Deposit Agreement (as hereafter
defined), each ADS represents one (1) share of Common Stock deposited
under the Deposit Agreement with the Custodian, which at the date of
execution of the Deposit Agreement, as amended, is the Manila branch
of Citibank, N.A. (the "Custodian"). The Deposit Agreement and this
American Depositary Receipt ("ADR") (which includes the provisions set
forth on the reverse hereof) shall be governed by and construed in
accordance with the laws of the State of New York.
Section 3.04. The first sentence of paragraph (1) of the form of ADR is
amended to read as follows:
This ADR is issued pursuant to the Common Stock Deposit Agreement
dated as of October 19, 1994, as amended as of January , 2003 (as so
amended and further amended from time to time, the "Deposit
Agreement"), by and among the Depositary and all Holders from time to
time of ADRs issued thereunder, each of whom by accepting an ADR or
acquiring any beneficial interest therein agrees to become a party
thereto and becomes bound by all terms and provisions thereof.
Section 3.05. Paragraph (3) of the form of ADR is amended to include
the following sentence at the end of the second paragraph thereof:
At the request of a Holder, the Depositary shall, for the purpose of
substituting a certificated ADR with a Direct Registration ADR, or
vice
6
versa, execute and deliver a certificated ADR or a Direct Registration
ADR, as the case may be, for any authorized number of ADSs requested,
evidencing the same aggregate number of ADSs as those evidenced by the
certificated ADR or Direct Registration ADR, as the case may be,
substituted.
Section 3.06. The following language is inserted at the end of the
first paragraph of paragraph (24) of the form of ADR:
In no event shall the Depositary or any of its agents be liable for
any indirect, special, punitive or consequential damages.
Section 3.07. The first two paragraphs of Paragraph (26) of the form of
ADR are amended to read as follows:
The Depositary may at any time resign as Depositary under the
Deposit Agreement by 30 days' written notice of its election so to do
to the Company, such resignation to take effect upon the appointment
of a successor depositary and its acceptance of such appointment as
provided in the Deposit Agreement. The Depositary may at any time be
removed by the Company by 30 days prior written notice of such
removal.
In case at any time the Depositary acting under the Deposit
Agreement resigns or is removed, the Company has agreed to use its
best efforts to appoint a successor depositary, which shall be a bank
or trust company having an office in the Borough of Manhattan, The
City of New York. Any corporation into or with which the Depositary
may be merged or consolidated will be the successor of the Depositary
without the execution or filing of any document or any further act.
ARTICLE IV
MISCELLANEOUS
SECTION 4.01. Effective Date. This Amendment is dated as of the date
set forth above and shall be effective as of the time of effectiveness of the
Registration Statement on Form F-6 to be filed by the Depositary in connection
with its appointment as successor Depositary (the "Effective Date"). After the
Effective Date, the Depositary agrees to promptly mail notice of its
7
appointment to the Holders.
SECTION 4.02. Outstanding ADRs. ADRs issued prior or subsequent to the
date hereof, which do not reflect the changes to the form of ADR effected hereby
(as set forth in Exhibit A hereto), do not need to be called in for exchange and
may remain outstanding until such time as the Holders thereof choose to
surrender them for any reason under the Deposit Agreement. The Depositary is
authorized and directed to take any and all actions deemed necessary to effect
the foregoing, including the printing or overstamping of the form of ADR to
reflect the changes to the form of ADR effected hereby.
SECTION 4.03. Indemnification. The Depositary shall be entitled to the
benefits of the indemnification provisions of Section 5.09 of the Deposit
Agreement in connection with any and all liability it may incur as a result of
the terms of this Amendment and the transactions contemplated herein, subject to
the exceptions provided therein.
SECTION 4.04. Ratification. Except as expressly amended hereby, the
terms, covenants and conditions of the Deposit Agreement, as originally
executed, shall remain in full force and effect.
8
IN WITNESS WHEREOF, the Depositary has duly executed this Amendment as
of the Effective Date and all holders shall become parties hereto upon
acceptance by them of ADRs issued in accordance with the terms hereof, by
continuing to hold their current ADRs or upon acquisition of any beneficial
interest in ADRs.
JPMORGAN CHASE BANK
By:
------------------------
Name:
Title: Vice President
Pursuant to the provisions of Section 6.01 of the Deposit Agreement,
the Company hereby consents to the terms of this Amendment No. 1 to Deposit
Agreement as executed by the Depositary.
PHILIPPINE LONG DISTANCE TELEPHONE COMPANY
By:______________________________
Name:
Title:
9
EXHIBIT A
Number _________
American Depositary Shares
(One American Depositary
Share Represents One Fully
Paid Share of Common Stock)
[FORM OF FACE OF AMERICAN DEPOSITARY RECEIPT]
AMERICAN DEPOSITARY RECEIPT
evidencing
American Depositary Shares
representing
DEPOSITED FULLY PAID SHARES OF COMMON STOCK
of
PHILIPPINE LONG DISTANCE TELEPHONE COMPANY
(Incorporated under the laws of
the Republic of the Philippines)
THE HOLDER OF THIS AMERICAN DEPOSITARY RECEIPT SHALL NOT HAVE, AND SHALL NOT
HAVE THE RIGHT TO INSTRUCT THE DEPOSITARY AS TO THE EXERCISE OF, ANY DISSENTER'S
RIGHTS PROVIDED TO HOLDERS OF COMMON STOCK UNDER PHILIPPINE LAW.
JPMORGAN CHASE BANK, a New York corporation, as depositary hereunder
(the "Depositary"), hereby certifies that is the owner of that number of
American Depositary Shares ("ADSs"), indicated on the records of the Depositary,
representing deposited fully paid Common Stock (the "Common Stock"), including
evidence of rights to receive such Common Stock (including, but not limited to,
purchase invoices as may effectuate the legal transfer of title to shares under
Philippine law), of Philippines Long Distance Telephone Company, a corporation
organized under the laws of the Republic of the Philippines (the "Company"). At
the date of the Deposit Agreement (as hereafter defined), each ADS represents
one (1) share of Common Stock deposited under the Deposit Agreement with the
Custodian, which at the date of execution of the Deposit Agreement, as amended,
is the Manila branch of Citibank, N.A. (the "Custodian"). The Deposit Agreement
and this American Depositary Receipt ("ADR") (which includes the provisions set
forth on the reverse hereof) shall be governed by and construed in accordance
with the laws of the State of New York.
A-1
(1) The Deposit Agreement. This ADR is issued pursuant to the Common
Stock Deposit Agreement dated as of October 19, 1994, as amended as of January ,
2003 (as so amended and further amended from time to time, the "Deposit
Agreement"), by and among the Depositary and all Holders from time to time of
ADRs issued thereunder, each of whom by accepting an ADR or acquiring any
beneficial interest therein agrees to become a party thereto and becomes bound
by all terms and provisions thereof. The Deposit Agreement sets forth the rights
of Holders of the ADRs and the rights and duties of the Depositary in respect of
the Common Stock deposited thereunder and any and all other securities, property
and cash from time to time received in respect of such Shares and held
thereunder (such Common Stock, securities, property and cash, collectively, the
"Deposited Securities"). Copies of the Deposit Agreement are on file at the
Principal New York Office of the Depositary and at the principal office of the
Custodian. The statements made on the face and the reverse of this ADR are
summaries of certain provisions of the Deposit Agreement and are qualified by
and subject to the detailed provisions of the Deposit Agreement, to which
reference is hereby made. Terms defined in the Deposit Agreement and not
otherwise defined herein have the same defined meanings set forth in the Deposit
Agreement.
(2) Surrender of ADRs and Withdrawal of Deposited Securities. Subject
to the terms and conditions of the Deposit Agreement, upon (i) surrender of ADSs
by delivery of ADRs at the Principal New York Office of the Depositary for the
purpose of withdrawal or sale of the Deposited Securities represented thereby
and (ii) payment of all fees (including the fees of the Depositary (which are
summarized in paragraph (8) of this ADR) provided in the Deposit Agreement,
including Exhibit B thereto), taxes (including stamp, transfer and capital gains
taxes) and governmental or other charges payable in connection with such
surrender and cancellation of ADRs, a Holder is entitled to (A) physical
delivery, to him or upon his order, or electronic delivery, if available, to an
account outside the United States designated by such person of the Common Stock
and any other documents of title at the time represented by the ADR together
with such other delivery of Deposited Securities (other than Common Stock) then
represented by ADSs as the Depositary may effect or (B) request that the
Depositary use reasonable efforts to sell or cause to be sold the Common Stock
represented by the ADSs evidenced by such ADRs on such Holder's behalf over the
Philippine Stock Exchange and to remit the proceeds thereof (less the fees and
expenses provided herein and any brokerage fee or selling expenses incurred in
connection with such sale) to such Holder or in accordance with such Holder's
instructions; provided that no such request may be made by any such Holder to
the Depositary to sell or to cause to be sold such Common Stock in amounts less
than the minimum trading (board) lot prescribed by the Philippine Stock
Exchange.
An ADR surrendered and written instructions received for such purposes
may be required by the Depositary to be properly endorsed or accompanied by
properly executed instruments of transfer. The person requesting withdrawal of
Deposited Securities or the sale of Common Stock as provided under the Deposit
Agreement and described herein shall deliver to the Depositary written
instructions requesting the Depositary to cause (i) the Deposited Securities
being withdrawn to be delivered (subject to any applicable clearing procedures
and provisions of the Amended Articles of Incorporation of the Company and
subject to the provisions of this
A-2
paragraph (2)) to or upon the written order of a person or persons designated in
such order or (ii) the Common Stock being withdrawn to be so sold.
Upon the receipt of written instructions to use reasonable efforts to
sell or cause to be sold the Common Stock represented by ADSs being withdrawn
from deposit under the Deposit Agreement and compliance with the other
provisions of Section 2.05 of the Deposit Agreement, the Depositary will,
subject to the terms and conditions of the Deposit Agreement and applicable laws
and regulations, direct the Custodian to make reasonable efforts, in its sole
discretion, to sell or cause to be sold the Common Stock represented by the ADSs
so surrendered, through a securities company in the Philippines selected by the
Depositary, over the Philippine Stock Exchange. Any such sale of Common Stock
will be at the risk and expense (including any brokerage commissions), of the
Holder requesting such sale. Upon receipt of any proceeds from such sale (less
any fees and expenses incurred in connection with such sale, including brokerage
commissions) the Depositary will, subject to the terms of Section 4.06 of the
Deposit Agreement (which are summarized in paragraph (18) below), convert or
cause to be converted any such proceeds into dollars and distribute any such
proceeds to or to the order of the person or persons designated in such written
instructions. The Depositary may make delivery to such person or persons at the
Principal New York Office of the Depositary of any such proceeds of sale. The
parties acknowledge that no assurance can be given that the Depositary will be
able to effect any sale of any Common Stock in a timely manner or at a specified
price, particularly during periods of trading illiquidity or volatility with
respect to Common Stock.
Upon the receipt of written instructions requesting the withdrawal and
delivery of Deposited Securities from deposit under the Deposit Agreement and
compliance with the other provisions of Section 2.05 of the Deposit Agreement,
the Depositary will direct the Custodian to deliver at the principal office of
such Custodian, subject to the terms and conditions of the Deposit Agreement and
applicable laws and regulations, to or upon the written order of the person or
persons designated in such written instructions, the Deposited Securities
represented by the ADSs evidenced by such surrendered ADR or represented by the
ADSs specified in such written instructions; except that the Depositary may,
subject to applicable law, make delivery to such person or persons at the
Principal New York Office of the Depositary of any dividends or distributions
(other than dividends or distributions consisting of Common Stock) with respect
to the Deposited Securities to be withdrawn, or of any proceeds of sale of any
dividends, distributions (other than dividends or distributions consisting of
Common Stock) or rights with respect to the Deposited Securities which may at
the time be held by the Depositary.
At the request, risk and expense of any Holder so surrendering an ADR
or submitting such written instructions for delivery, and for the account of
such Holder, and provided that payment of any applicable tax or governmental or
other charge shall have been made in accordance with Section 3.02 of the Deposit
Agreement, the Depositary will direct the Custodian to forward any cash or other
property (other than rights) comprising, and forward a certificate or
certificates (if certificates may be delivered) and other proper documents of
title, if any, for, the Deposited Securities represented by the ADSs evidenced
by such ADR to the Depositary for delivery at the Principal New York Office of
the Depositary. Such direction will
A-3
be given by letter or, at the request, risk and expense of such Holder, by
cable, telex or facsimile transmission.
The Depositary will not accept surrender of ADRs or written
instructions for the purpose of withdrawal of less than one share of Common
Stock. In addition, the Depositary shall only honor requests for withdrawal of
whole numbers of shares of Common Stock. In the case of surrender of an ADR
evidencing a number of ADSs representing other than a whole number of shares of
Common Stock, the Depositary will cause delivery of the appropriate whole number
of shares of Common Stock as provided in the Deposit Agreement and summarized
herein, and will execute and deliver to the person surrendering such ADR a new
ADR evidencing ADSs representing any remaining fractional shares of Common
Stock.
Notwithstanding anything in the Deposit Agreement to the contrary, the
Company and the Depositary each agrees that it will not exercise any rights it
has under the Deposit Agreement to prevent the withdrawal or delivery of
Deposited Securities in a manner which would violate the United States
securities laws, including, but not limited to, Section I.A(1) of the General
Instructions to the Form F-6 Registration Statement, as amended from time to
time, under the Securities Act of 1933.
(3) Transfers, Split-ups and Combinations. Subject to the limitations
stated herein and in the Deposit Agreement, this ADR is transferable on the
books of the Depositary by the Holder hereof in person or by duly authorized
attorney, upon surrender (at the Depositary's Principal New York Office) of this
ADR properly endorsed or accompanied by proper instruments of transfer
(including signature guarantees in accordance with standard industry practice)
and duly stamped as may be required by any applicable law. Thereupon, the
Depositary will execute a new ADR or ADRs and deliver the same to or upon the
order of the person entitled thereto.
This ADR may be split into other ADRs or may be combined with other
ADRs into one ADR, evidencing the same aggregate number of ADSs and registered
in the name of the same Holder as the ADR or ADRs surrendered. At the request of
a Holder, the Depositary shall, for the purpose of substituting a certificated
ADR with a Direct Registration ADR, or vice versa, execute and deliver a
certificated ADR or a Direct Registration ADR, as the case may be, for any
authorized number of ADSs requested, evidencing the same aggregate number of
ADSs as those evidenced by the certificated ADR or Direct Registration ADR, as
the case may be, substituted.
(4) Limitations on Execution and Delivery, Transfer, Etc. of ADRs;
Suspension of Delivery, Transfer, Etc. As a condition precedent to the execution
and delivery, registration of transfer, split-up, combination or surrender of
any ADR for the purpose of withdrawal of any Deposited Securities, the
Depositary or the Custodian may require (i) payment from the Holder, the
presenter of an ADR or the depositor of Common Stock, of a sum sufficient to
reimburse it for any taxes (including any transfer, capital gains or stamp
taxes) or governmental or other charges and any stock transfer, custody or
registration fee with respect thereto and payment of any applicable fees (which
are summarized in paragraph (8) of this ADR) provided for in the Deposit
Agreement, including Exhibit B thereto, (ii) production of proof satisfactory to
it as to
A-4
the identity and genuineness of any signature, including, but not limited to, a
signature guarantee in accordance with industry practice, and (iii) compliance
with such other restrictions, if any, as the Depositary may, after consultation
with the Company, establish consistent with the provisions of the Deposit
Agreement.
The delivery of ADRs against deposits of Common Stock generally or of
particular Common Stock may be suspended or withheld, or the registration of
transfer of ADRs in particular instances may be refused, or the registration of
transfer generally may be suspended, or the surrender of outstanding ADRs for
the purpose of withdrawal of Deposited Securities may be suspended, during any
period when the transfer books of the Depositary or the Company (or the
appointed agent of the Company for the transfer and registration of Common
Stock) are closed, or if any such action is deemed necessary or advisable by the
Company or the Depositary at any time or from time to time.
Subject to the further terms and provisions of Section 2.06 of the
Deposit Agreement (which are summarized in this paragraph (4)), JPMorgan Chase
Bank and its agents, on their own behalf, may own and deal in any class of
securities of the Company and its affiliates and in ADRs. The Depositary may
issue ADRs for evidence of rights to receive Common Stock from the Company, or
any custodian, registrar, transfer agent, clearing agency or other entity
involved in ownership or transaction records in respect of the Common Stock.
Such evidence of rights shall consist of written blanket or specific guarantees
of ownership of Common Stock furnished on behalf of the Holder hereof. Neither
the Depositary nor the Custodian shall lend Deposited Securities or ADRs;
provided, however, that the Depositary may issue ADRs prior to the receipt of
Common Stock pursuant to Section 2.02 of the Deposit Agreement (a "Pre-Release
Transaction") and deliver shares of Common Stock upon the receipt and
cancellation of ADRs which have been Pre-Released, whether or not such
cancellation is prior to the termination of such Pre-Release Transaction or the
Depositary knows that such ADR has been Pre-Released. The Depositary may receive
ADRs in lieu of shares in satisfaction of a Pre-Release Transaction. Each such
Pre-Release transaction will be (a) subject to (x) a written representation from
the person to whom ADRs are to be delivered (the "Applicant") that such person,
or its customer, owns the Common Stock to be remitted, (y) an unconditional
guarantee by such person to deliver to the Custodian the number of shares of
Common Stock that are the subject of the Pre-Release Transaction and (z) any
additional restrictions or requirements that the Depositary deems appropriate,
(b) subject to a written representation to the Applicant that it will hold such
shares of Common Stock in trust for the Depositary until their delivery to the
Depositary or Custodian, reflect on its records the Depositary as owner of such
shares of Common Stock and deliver such Common Stock upon the Depositary's
request, (c) at all times fully collateralized (marked to market daily) with
cash, United States government securities or such other collateral of comparable
safety and liquidity, (d) terminable by the Depositary on not more than five (5)
business days notice, and (e) subject to such further indemnities and credit
regulations as the Depositary deems appropriate. The Depositary intends that the
number of ADRs issued by it pursuant to a Pre-Release Transaction and
outstanding at anytime generally will not exceed thirty percent (30%) of the
ADRs issued by the Depositary and with respect to which shares of Common Stock
are on deposit with the Depositary or Custodian; provided, however, that the
A-5
Depositary reserves the right to change or disregard such limit from time to
time as it deems appropriate. The Depositary will also set limits with respect
to the number of ADRs and Common Stock involved in transactions to be effected
hereunder with any one person on a case by case basis as it deems appropriate.
The Depositary may retain for its own account any compensation received
by it in connection with the foregoing. Collateral provided pursuant to (b)
above, but not the earnings thereon, shall be held for the benefit of the
Holders only.
Without limitation of the foregoing, the Depositary will not knowingly
accept for deposit under this Deposit Agreement any Common Stock required to be
registered pursuant to the provisions of the Securities Act (including, but not
limited to, any "restricted securities" within the meaning of Rule 144 under the
Securities Act), unless a registration statement under the Securities Act is in
effect as to such Common Stock. The Depositary will use reasonable efforts to
comply with written instructions of the Company not to accept for deposit under
the Deposit Agreement any Common Stock identified in such instructions at such
times and under such circumstances as may reasonably be specified in such
instructions in order to facilitate the Company's compliance with the securities
laws of the United States.
Any person depositing Common Stock or any Holder may be required from
time to time to file with the Depositary or the Custodian such proof of
citizenship, residence, exchange control approval, payment of all applicable
taxes or other governmental charges, compliance with all applicable laws and
regulations and the terms of the Deposit Agreement, or legal or beneficial
ownership and the nature of such interest, to provide information relating to
the registration on the books of the Company (or the appointed agent of the
Company for the transfer and registration of Common Stock) of the Common Stock
presented for deposit or other information, to execute such certificates and to
make such representations and warranties as the Depositary or the Company may
deem necessary or proper to enable the Depositary to perform its obligations
under the Deposit Agreement or to enable the Company or the Depositary to
perform their respective obligations under the Company Agreement (as hereinafter
defined). The Depositary may withhold the execution or delivery or registration
of transfer of all or part of any ADR or the distribution or sale of any
dividend or other distribution of rights or of the proceeds thereof or the
withdrawal of any Deposited Securities until such proof or other information is
filed or such certificates are executed or such representations and warranties
are made. The Depositary shall take such additional actions and provide such
additional information as the Depositary shall from time to time agree with the
Company.
(5) Liability of Holders for Taxes and Other Charges. If any tax or
governmental or other charge shall become payable with respect to this ADR, to
any Deposited Securities represented by the ADSs evidenced hereby, such tax or
governmental or other charge (other than any capital or stamp duties or transfer
taxes payable by the Company in accordance with the terms and conditions of the
Common Stock) shall be payable by the Holder hereof to the Depositary. The
Depositary may refuse, and the Company shall be under no obligation, to effect
any registration of transfer of all or any part of this ADR or any deposit or
withdrawal of
A-6
Deposited Securities represented by the ADSs evidenced hereby until such payment
is made, and may withhold any dividends or other distributions, or may sell for
the account of the Holder hereof any part or all of the Deposited Securities
represented by the ADSs evidenced hereby, and may apply such dividends or other
distributions or the proceeds of any such sale in payment of such tax or
governmental or other charge, the Holder hereof remaining liable for any
deficiency.
(6) Warranties by Depositor. Each person depositing Common Stock under
the Deposit Agreement shall be deemed thereby to represent and warrant that such
Common Stock and each certificate therefor are validly issued and outstanding,
fully paid and nonassessable, that the person making such deposit is duly
authorized to do so and that such shares of Common Stock are not "restricted
securities" as such term is defined in Rule 144 of the Securities Act. Such
representations and warranties shall survive the deposit of Common Stock and
issuance of ADRs in respect thereof.
(7) Compliance with U.S. Securities Laws. Notwithstanding anything in
the Deposit Agreement to the contrary, the Company and the Depositary have each
agreed that it will not exercise any rights it has under the Deposit Agreement
to prevent the withdrawal or delivery of Deposited Securities in a manner which
would violate the United States securities laws, including, but not limited to,
Section I.A. (1) of the General Instructions to the Form F-6 Registration
Statement, as amended from time to time, under the Securities Act of 1933.
(8) Charges of Depositary. The Depositary will charge the party
receiving an ADR against deposit of Common Stock or other depositary receipts,
$0.05 per ADS. The Depositary will charge the party surrendering an ADR in
connection with the withdrawal of Deposit Securities, $0.05 per ADS. The
Depositary will charge the party for whom the sale or exercise of rights, is
made, $0.02 per ADS per distribution. Holders will pay through deduction or
otherwise, in addition to the fees and charges summarized above in this
paragraph (8) and set forth in Exhibit B to the Deposit Agreement, (i) taxes and
other governmental charges (including, but not limited to, any transfer, capital
gains and stamp tax) other than any capital or stamp duties or transfer taxes
payable by the Company in accordance with the terms and conditions of the Common
Stock, (ii) such registration, transfer, custody or other fees as may from time
to time be in effect for the registration of transfers of Common Stock generally
on the share register of the Company or its appointed agent for the registration
of transfer and accordingly applicable to transfers of Common Stock to or from
the name of the Nominee on the making of deposits pursuant to Section 2.02 of
the Deposit Agreement or withdrawals pursuant to Section 2.05 of the Deposit
Agreement, (iii) such cable, telex, facsimile transmission and delivery expenses
as are expressly provided in the Deposit Agreement to be at the expense of
persons depositing Common Stock or Holders and (iv) such reasonable expenses and
charges as are incurred by the Depositary in the conversion of foreign currency
pursuant to Section 4.06 of the Deposit Agreement (which is summarized in
paragraph (18) hereof) or in connection with other distributions to holders of
Common Stock pursuant to Section 4.02, 4.03, 4.04 or 4.05 of the Deposit
Agreement (which are summarized in paragraphs (14), (15), (16) and (17),
respectively, hereof).
A-7
Any other charges and expenses of the Depositary under the Deposit
Agreement and the Registrar, if any, will be paid by the Company after
consultation and agreement and in accordance with agreements in writing entered
into between the Depositary and the Company as to the nature and amount of such
charges and expenses. The charges and expenses of the Custodian, the Nominee or
any other agent of the Depositary are for the sole account of the Depositary.
The right of the Depositary to receive payment of fees, charges and
expenses as provided in Section 5.05 of the Deposit Agreement (and summarized in
this paragraph (8)) shall survive the termination of the Deposit Agreement and,
as to any Depositary, the resignation of such Depositary pursuant to Section
5.04 of the Deposit Agreement.
(9) Title to ADRs. Subject to any limitations set forth herein or in
the Deposit Agreement, it is a condition of this ADR, and every successive
Holder hereof by accepting or holding the same consents and agrees, that when
properly endorsed or accompanied by proper instruments of transfer (including
signature guarantees in accordance with standard industry practice) title to
this ADR (and to each ADS evidenced hereby) is transferable by delivery with the
same effect as in the case of a negotiable instrument in accordance with the
laws of the State of New York; provided, however, that the Depositary and the
Company, notwithstanding any notice to the contrary, may deem and treat the
Holder of this ADR as the absolute owner hereof for any purpose, including,
without limitation, the purpose of determining the person entitled to
distribution of dividends or other distributions or to any notice provided for
in the Deposit Agreement and neither the Depositary nor the Company shall have
any obligation or be subject to any liability under the Deposit Agreement to any
holder hereof unless such holder is the Holder hereof.
(10) Validity of ADR. This ADR shall not be entitled to any benefits
under the Deposit Agreement or be valid or obligatory for any purpose unless
this ADR has been executed by the Depositary by the manual signature of a duly
authorized officer of the Depositary or, if a Registrar shall have been
appointed, such signature may be a facsimile if this ADR is counter- signed by
the manual signature of a duly authorized officer of the Registrar and dated by
such officer.
(11) Disclosure of Interests. The Company or the Depositary may from
time to time request Holders or former Holders to provide information as to the
capacity in which they hold or held this ADR and the nature of such interest and
various other matters. Each such Holder agrees to provide any such information
reasonably requested by the Company or the Depositary pursuant to the Deposit
Agreement whether or not still a Holder at the time of such request.
(12) Ownership Restrictions. The Company may restrict transfers of
Common Stock if such transfer might result in ownership of Common Stock
exceeding the limits under any applicable law or the Company's Amended Articles
of Incorporation. The Philippine
A-8
Constitution requires that at least 60% of the capital of a corporation
operating a public utility in the Philippines be owned by Philippine citizens.
The Depositary will, if and as directed by the Company, take action with respect
to the ownership interest of any Holder in excess of any legal or contractual
limitations on the legal or beneficial ownership of Common Stock or ADSs,
including, but not limited to, a mandatory sale or disposition on behalf of a
Holder of the Common Stock represented by the ADSs held by such Holder in excess
of such limitation, if and to the extent such disposition is permitted by
applicable law.
(13) Available Information. The Company is subject to the periodic
reporting requirements of the Securities Exchange Act of 1934 and, accordingly,
files certain reports with the Commission. These public reports can be inspected
by Holders and copied at the public reference facilities maintained by the
Commission located at the date of this Deposit Agreement at Judiciary Plaza, ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇.
JPMORGAN CHASE BANK, as depositary
By:_______________________________
Dated:
The address of the Principal New York Office of the Depositary is 1
Chase ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇.
A-9
(FORM OF REVERSE OF AMERICAN DEPOSITARY RECEIPT)
SUMMARY OF CERTAIN ADDITIONAL PROVISIONS
OF THE DEPOSIT AGREEMENT
(14) Cash Distributions; Withholding. Whenever the Custodian or the
Depositary receives any cash dividend or other cash distribution by the Company
in respect of any Deposited Securities, the Depositary will, subject to the
provisions of Section 4.06 of the Deposit Agreement (which are summarized in
paragraph (18) below), convert or cause any portion of such dividend or
distribution which is not in dollars to be converted into dollars and shall
promptly distribute such amount to the Holders entitled hereto in proportion to
the number of ADSs representing such Deposited Securities held by them
respectively, after deduction or upon payment of the fees and expenses of the
Depositary or the Custodian (and without liability for interest); provided,
however, that in the event that the Company, the Custodian or the Depositary
shall be required to withhold and does withhold from any cash dividend or other
cash distribution in respect of any Deposited Securities an amount on account of
taxes or other governmental charges, the amount distributed to Holders in
respect of ADSs representing such Deposited Securities shall be reduced
accordingly. The Depositary will distribute only such amount, however, as can be
distributed without attributing to any Holder a fraction of one cent, and any
balance not so distributable will be held by the Depositary (without liability
for interest thereon) and will be added to and become part of the next sum
received by the Depositary for distribution to Holders then outstanding. The
Company has agreed with the Depositary that the Company or its agent, or the
Depositary or its agent, as appropriate, will remit to the appropriate
governmental authority or agency all amounts withheld and owing to such
authority or agency. The Depositary will forward to the Company or its agent
such information from its records as the Company may reasonably request to
enable the Company or its agent to file necessary reports with governmental
authorities or agencies or, at the request and expense of the Company, the
Depositary or its agent may file such reports if deemed lawful and reasonably
feasible by the Depositary.
(15) Distributions in Common Stock. If any distribution in respect of
any Deposited Securities consists of a dividend in, or free distribution of,
Common Stock, the Depositary may, after consultation with the Company,
distribute to the Holders entitled thereto, in proportion to the number of ADSs
representing such Deposited Securities held by them respectively, additional
ADRs for an aggregate number of ADSs representing the number of shares of Common
Stock received as such dividend or free distribution, in either case, after
deduction or upon payment of the fees and expenses of the Depositary; provided,
however, that if for any reason (including any requirement that the Company or
the Depositary withhold, or make an advance payment of, an amount on account of
taxes or other governmental charges or that such Common Stock must be registered
under the Securities Act in order to be distributed to Holders) the Depositary
reasonably deems such distribution not to be practical or feasible, the
Depositary may, after consultation with the Company, (i) to the extent permitted
by applicable law, adopt such method as it may reasonably deem equitable and
practicable for the purpose of obtaining such dividend or effecting such
distribution, including the sale (at public or private sale) of the Common Stock
thus received, or any part thereof, and the net proceeds of any such
A-10
sale after payment of and reimbursement of advances to pay any taxes or
governmental charges shall be distributed by the Depositary to the Holders
entitled thereto as in the case of a distribution received in cash or (ii) if
the Depositary reasonably determines that no such method of distribution can be
effected in a practicable or equitable manner, the Depositary may refrain from
effecting such distribution altogether until such time as it reasonably
determines that a practicable or equitable distribution can be effected. In lieu
of issuing ADRs or adjusting the Depositary's records for fractional ADSs in any
such case, the Depositary will sell the number of shares of Common Stock
represented by the aggregate of such fractions and distribute the net proceeds
in dollars, all in the manner and subject to the conditions set forth in Section
4.02 of the Deposit Agreement (which are summarized in paragraph (14) above). If
additional ADRs are not so distributed (except pursuant to the preceding
sentence), or such change in the records of the Depositary is not made, each ADS
will thenceforth also represent its proportionate interest in the additional
shares of Common Stock distributed upon the Deposited Securities represented
thereby.
(16) Distribution of Rights. In the event that the Company shall offer
or cause to be offered to the holders of any Deposited Securities any rights to
subscribe for additional Common Stock or any rights of any other nature, the
Depositary, after consultation with the Company, has discretion as to the
procedure to be followed in making such rights available to the Holders entitled
thereto, subject to certain conditions set forth in Section 5.09 of the Deposit
Agreement (which are summarized in paragraph (27) below), or in disposing of
such rights on behalf of such Holders and making the net proceeds available in
cash to such Holders or, if by the terms of such rights offering or by reason of
applicable law, the Depositary may neither make such rights available to such
Holders nor dispose of such rights and make the net proceeds available to such
Holders, then the Depositary will allow the rights to lapse; provided, however,
that the Depositary will, if requested by the Company, take action as follows:
(i) if at the time of the offering of any rights the Depositary
determines that it is lawful and feasible to make such rights available to
all or certain Holders by means of warrants or otherwise, the Depositary
will, after deduction or upon payment of the fees and expenses of the
Depositary, distribute warrants or other instruments in proportion to the
number of ADSs representing such Deposited Securities held by them
respectively, or by means of such other method as it may deem feasible in
order to facilitate the exercise, sale or transfer of rights by such
Holders or the sale or resale of securities obtainable upon exercise of
such rights by such Holders; or
(ii) if at the time of the offering of any rights the Depositary
determines that it is not lawful or not feasible to make such rights
available to certain Holders by means of warrants or otherwise, or if the
rights represented by such warrants or such other instruments are not
exercised and appear to be about to lapse, the Depositary will use its
reasonable efforts to sell such rights or such warrants or other
instruments, if a market therefor is available, at public or private sales,
at such place or places and upon such terms as it may deem proper and,
after deduction or upon payment of the fees and expenses of the Depositary
and any applicable taxes, allocate the net proceeds of such
A-11
sales for the account of the Holders otherwise entitled to such rights,
warrants or other instruments upon an averaged or other practicable basis
without regard to any distinctions among such Holders because of exchange
restrictions or the date of delivery of any ADR or ADRs, or otherwise.
If registration (under the Securities Act or any other applicable law)
of the rights or the securities to which any rights relate is required in order
for the Company to offer such rights to Holders and to sell to them the
securities to which such rights relate, the Depositary will not offer such
rights to Holders unless and until a registration statement is in effect, or
unless the offering and sale of such rights or securities to such Holders are
exempt from registration under the provisions of such law and, if requested by
the Depositary, the Company furnishes to the Depositary an opinion of counsel in
the United States for the Company reasonably satisfactory to the Depositary to
such effect. The Company shall have no obligation to register such rights or
such securities under the Securities Act.
(17) Distributions Other Than Cash, Common Stock or Rights. Whenever
the Custodian or the Depositary shall receive any distribution other than cash,
Common Stock or rights upon any Deposited Securities, the Depositary will cause
the securities or property so received to be distributed to the Holders entitled
thereto, after deduction or upon payment of the fees and expenses of the
Depositary, in proportion to the number of ADSs representing such Deposited
Securities held by them respectively, in any manner that the Depositary may deem
equitable and practicable for accomplishing such distribution; provided,
however, that if in the opinion of the Depositary it cannot cause such
securities or property to be distributed or such distribution cannot be made
proportionately among the Holders entitled thereto, or if for any other reason
(including any requirement that the Company, the Custodian or the Depositary
withhold an amount on account of taxes or other governmental charges or that
such securities must be registered under the Securities Act in order to be
distributed to Holders) the Depositary deems such distribution not to be
feasible, the Depositary may, after consultation with the Company, adopt such
method as it may deem equitable and practicable for the purpose of effecting
such distribution, including the sale (at public or private sale) of the
securities or property thus received, or any part thereof, and the net proceeds
of any such sale will be distributed by the Depositary to the Holders entitled
thereto as in the case of a distribution received in cash; provided that any
unsold balance of such securities or property will be distributed by the
Depositary to the Holders entitled thereto, if such distribution is feasible
without withholding for or on account of any taxes or other governmental charges
and without registration under the Securities Act, in accordance with such
equitable and practicable method as the Depositary adopts.
(18) Conversion of Foreign Currency. Whenever the Custodian receives
currency other than dollars (in this paragraph referred to as "foreign
currency"), by way of dividends or other distributions or the net proceeds from
the sale of securities, property or rights, and if at the time of the receipt
thereof the foreign currency so received can in the judgment of the Depositary
be converted on a reasonable basis into dollars which can, at the time of
receipt thereof, be transferred to the United States and distributed to the
Holders entitled thereto, the
A-12
Depositary will promptly convert or cause to be converted, by sale or in any
other manner that it may determine, such foreign currency into dollars, and such
dollars (less any reasonable and customary expenses incurred by the Depositary
in the conversion of the foreign currency) will be distributed to the Holders
entitled thereto or, if the Depositary shall have distributed any warrants or
other instruments which entitle the holders thereof to such dollars, then to the
holders of such warrants and/or instruments upon surrender thereof for
cancellation. Such distribution will be made upon an averaged or other
practicable basis without regard to any distinctions among Holders on account of
any application of exchange restrictions or otherwise.
If such conversion or distribution generally or with regard to a
particular Holder can be effected only with the approval or license of any
government or agency thereof, the Depositary may file such application for
approval or license, if any, as it may deem desirable.
If at any time the Depositary determines that in its judgment any
foreign currency received by the Depositary is not convertible on a reasonable
basis into dollars distributable to Holders entitled thereto, or if any approval
or license of any government or authority or agency thereof which is required
for such conversion is denied or in the opinion of the Depositary is not
obtainable, or if any such approval or license is not obtained within a
reasonable period as determined by the Depositary, the Depositary may distribute
the foreign currency (or an appropriate document evidencing the right to receive
such foreign currency) received by the Depositary to, or in its discretion may
hold such foreign currency (without liability for interest) for the respective
accounts of, the Holders entitled to receive the same.
If any such conversion of foreign currency, in whole or in part, cannot
be effected for distribution to some Holders entitled thereto, the Depositary
may in its discretion make such conversion and distribution in dollars to the
extent permissible to the Holders for whom such conversion and distribution is
practicable and may, subject to any applicable currency and exchange
regulations, distribute the balance of the foreign currency received by the
Depositary to, or hold such balance for the account of, the Holders for whom
such conversion and distribution is not practicable.
(19) Fixing of Record Date. Whenever any cash dividend or other cash
distribution shall become payable or any distribution other than cash shall be
made, or whenever rights shall be issued, with respect to the Deposited
Securities, or whenever the Depositary receives notice of any meeting of holders
of Common Stock or other Deposited Securities or any other meeting of holders of
the Company's securities at which holders of Common Stock or other Deposited
Securities are entitled to vote, or whenever, for any reason, the Depositary
causes a change in the number of shares of Common Stock that are represented by
each ADS, or whenever the Depositary finds it necessary or convenient in respect
of any matter, the Depositary will fix a record date after consultation with the
Company (which shall be as near as practicable to the corresponding record date
for such distribution or meeting set by the Company) for the determination of
the Holders who shall be entitled to receive such dividend, distribution or
rights or the net proceeds of the sale thereof, or to give instructions for the
exercise of voting rights, if any, at any such meeting or in respect of such
changed number of shares of Common Stock represented by a ADS or in respect of
such other matter. Subject to the provisions of Sections
A-13
4.02 through 4.06 of the Deposit Agreement (which are summarized in paragraphs
(14) through (18), respectively, above) and to the other terms and conditions of
the Deposit Agreement, the Holders on such record date will be entitled to
receive the amount distributable by the Depositary with respect to such dividend
or other distribution or such rights or the net proceeds of sale thereof and to
exercise the rights of Holders under the Deposit Agreement with respect to such
changed number of shares of Common Stock represented by each ADS, in proportion
to the number of ADSs held by them respectively, to give such voting
instructions, to receive such notice or solicitation or to act in respect of any
matter.
(20) Voting of Deposited Securities. As soon as practicable after
receipt of notice of any meeting of holders of Common Stock or other Deposited
Securities or any other meeting of holders of the Company's securities at which
holders of Common Stock or other Deposited Securities are entitled to vote, the
Depositary will fix a record date for determining the Holders entitled to give
instructions for the exercise of voting rights as provided in Section 4.07 of
the Deposit Agreement (and summarized in paragraph (19) above) and will mail or
cause to be mailed to the Holders of record a notice which will contain: (a)
such information as is contained in such notice of meeting and (b) a statement
that the Holders of record at the close of business on a specified record date
will be entitled, subject to any applicable provisions of the law of the
Philippines and of the Amended Articles of Incorporation and the By-Laws of the
Company, to instruct the Depositary as to the exercise of the voting rights, if
any, pertaining to the number of shares of Common Stock or other Deposited
Securities represented by their respective ADSs evidenced by their respective
ADRs. Upon the written request of a Holder on such record date, received on or
before the date established by the Depositary for such purpose, the Depositary
will endeavor insofar as is practicable to vote or cause to be voted the amount
of Deposited Securities represented by such ADSs evidenced by such ADR in
accordance with the instructions set forth in such request.
The Depositary may not itself exercise any voting discretion over any
Common Stock. If the Depositary does not receive instructions from a Holder on
or before the date established by the Depositary for such purpose, such Holder
shall be deemed, and the Depositary shall deem such Holder, to have instructed
the Depositary to give a discretionary proxy to a person designated by the
Company for the purpose of exercising the voting rights, if any, pertaining to
the Common Stock represented by ADSs evidenced by such Holder's ADRs, provided
that no such discretionary proxy shall be given with respect to any matter as to
which the Company informs the Depositary that (i) the Company does not wish such
proxy given, (ii) substantial opposition exists or (iii) the rights of holders
of Common Stock will be materially and adversely affected.
Holders do not have, and will not have the right to instruct the
Depositary as to the exercise of, any dissenter's rights provided to holders of
Common Stock under Philippine law.
(21) Changes Affecting Deposited Securities. Upon any change in par
value, split-up, consolidation or any other reclassification of Deposited
Securities, or upon any recapitalization, reorganization, merger or
consolidation of the Company or sale of assets
A-14
affecting the Company or to which it is a party, any securities that shall be
received by the Depositary or the Custodian in exchange for or in conversion of
or in respect of Deposited Securities will be treated as new Deposited
Securities, and the ADRs will, subject to the terms of the Deposit Agreement and
applicable laws (including any registration requirements of the Securities Act),
thenceforth represent the right to receive the new Deposited Securities so
received in exchange or conversion, unless new or additional ADRs are delivered
pursuant to the following sentence. In any such case the Depositary may, and
will at the Company's request, subject to the terms of the Deposit Agreement,
execute and deliver additional ADRs, as in the case of a stock dividend on the
Common Stock, or call for the surrender of outstanding ADRs to be exchanged for
new ADRs specifically describing such new Deposited Securities.
Notwithstanding the foregoing, in the event that the Depositary
determines that any security or property so received may not be lawfully or
practicably distributed to all or certain Holders, the Depositary may and will,
if the Company requests, sell such securities or property at public or private
sale, at such place or places and upon such terms as it may deem proper, and may
allocate the net proceeds of such sales (after payment of the expenses thereof
and any taxes or governmental charges) for the account of the Holders otherwise
entitled to such securities or property upon an averaged or other practicable
basis without regard to any distinctions among such Holders and distribute the
net proceeds so allocated to the extent practicable as in the case of a
distribution received in cash pursuant to Section 4.02 of the Deposit Agreement
(which is summarized in paragraph (14) above).
Promptly upon receipt of notice from the Company of the occurrence of
any such change, conversion or exchange covered by Section 4.09 of the Deposit
Agreement (which is summarized in this paragraph (21)) in respect of the
Deposited Securities, the Depositary will give notice thereof in writing, at the
Company's expense, to all Holders.
(22) Transmittal by the Depositary of Company Notices, Reports and
Communications; Inspection of Transfer Books. The Depositary will make available
for inspection during business hours by Holders at its Principal New York Office
and at the principal office of each Custodian copies of (i) the Deposit
Agreement and any related documents, (ii) the Common Stock Agreement dated the
date of the Deposit Agreement between the Company and the Depositary and
relating thereto (the "Company Agreement"), (iii) the Company's Amended Articles
of Incorporation and By-Laws and the Resolutions of the Board of Directors
relating to the Common Stock and (iv) any notices, reports or communications,
including any proxy soliciting materials, received from the Company which are
both (a) received by the Depositary or the Custodian or the nominee of either,
as the holder of the Deposited Securities, and (b) made generally available to
the holders of such Deposited Securities by the Company. The Depositary will
also send to Holders, at the Company's expense, copies of such notices, reports
and communications when furnished by the Company to the Depositary pursuant to
Section 5.07 of the Deposit Agreement. The Depositary will keep books for the
registration of ADRs and their transfer which at all reasonable times will be
open for inspection by the Company and Holders of ADRs, provided that such
inspection shall not be for the purpose of communicating with Holders of ADRs in
the interest of a business or object other than the business of the Company or a
A-15
matter related to the Deposit Agreement or the ADRs.
(23) Withholding. Notwithstanding any other provision of the Deposit
Agreement, in the event that the Depositary determines that any distribution of
property (including Common Stock, rights to subscribe therefor and other
securities) is subject to any tax or governmental charges which the Depositary
is obligated to withhold, the Depositary may dispose of all or a portion of such
property (including Common Stock, rights to subscribe therefor and other
securities) in such amounts and in such manner as the Depositary deems necessary
and practicable to pay such taxes or governmental charges, including by public
or private sale, and the Depositary will distribute the net proceeds of any such
sale or the balance of any such property after deduction of such taxes or
governmental charges to the Holders entitled thereto in proportion to the number
of ADSs held by them respectively and the Depositary will, if feasible without
withholding for or on account of taxes or other governmental charges, and
otherwise in compliance with applicable law, distribute any unsold balance of
such property in accordance with the provisions of the Deposit Agreement. To the
extent that the Depositary is obligated to withhold as described in the previous
sentence, the Depositary will remit to the appropriate governmental authority or
agency all amounts withheld and owing to such authority or agency and will file
such corresponding reports as may be required.
The Company has agreed with the Depositary that, before making any
distribution or other payment on any Deposited Securities, the Company will make
such deductions (if any) which, by the laws or regulations of the Philippines,
the Company is required to make in respect of any income, capital gains or other
taxes and that the Company may also deduct the amount of any tax or governmental
charges payable by the Company or for which the Company might be made liable in
respect of such distribution or other payment or any document signed in
connection therewith.
(24) Obligations of the Depositary, the Custodian and the Company. The
Company assumes no obligation nor is it subject to any liability under the
Deposit Agreement to Holders or other persons, except that it has agreed with
the Depositary to act in good faith and use reasonable judgment in the
performance of its obligations set forth in the Company Agreement. The
Depositary assumes no obligation nor is it subject to any liability under the
Deposit Agreement to Holders or other persons (including, without limitation,
liability with respect to the validity or worth of the Deposited Securities),
except that it has agreed to act in good faith and use reasonable judgment in
the performance of its obligations set forth in the Deposit Agreement. The
Depositary has undertaken in the Deposit Agreement to perform such duties and
only such duties as are specifically set forth therein, and no implied covenants
or obligations shall be read into the Deposit Agreement against the Depositary
or the Company. In no event shall the Depositary or any of its agents be liable
for any indirect, special, punitive or consequential damages.
Neither the Depositary nor the Company are under any obligation to
appear in, prosecute or defend any action, suit or other proceeding in respect
of any Deposited Securities or in respect of the ADRs, which in its opinion may
involve it in expense or liability, unless indemnity satisfactory to it in its
sole discretion against all expense and liability be furnished as
A-16
often as may be required, and no Custodian is under any obligation whatsoever
with respect to such proceedings, the Custodian being responsible solely to the
Depositary.
Neither the Depositary nor the Company shall be liable for any action
or inaction by it in reliance upon the advice of or information from legal
counsel, accountants, any person presenting Common Stock for deposit, any
Holder, or any other person believed by it in good faith to be competent to give
such advice or information. Each of the Depositary, its agents and the Company
and its agents may rely and shall be protected in acting upon any written
notice, request, direction or other document believed by it to be genuine and to
have been signed or presented by the proper party or parties. Subject to the
provisions of Section 5.02 of the Deposit Agreement (which are summarized in
this paragraph (24)), the Depositary is not responsible for any failure to carry
out any instructions to vote any of the Deposited Securities, for the manner in
which any such vote is cast or for the effect of any such vote.
It is intended that neither the Depositary nor any agent of the
Depositary shall be deemed to be an "issuer" of the securities under the federal
securities laws or applicable state securities laws of the United States or any
other jurisdiction, it being expressly understood and agreed that the Depositary
and its agent are acting only in a ministerial capacity as Depositary for the
Common Stock.
(25) Prevention or Delay in Performance by the Depositary or the
Company. Neither the Depositary nor the Company will incur any liability to any
Holder or other person if by reason of any present or future law, regulation,
decree, order or other action of the United States, the Philippines or any other
country or jurisdiction, or of any other governmental authority, or by reason of
any act of God, war or other circumstances beyond its control or, in the case of
the Depositary, by reason of any provision, present or future, of the Amended
Articles of Incorporation and By-laws of the Company or any Deposited
Securities, the Depositary or the Company is prevented, delayed or forbidden
from doing or performing any act or thing which by the terms of the Deposit
Agreement (in the case of the Depositary) or the Company Agreement it is
provided shall be done or performed; nor will the Depositary or the Company
incur any liability to any Holder or other person by reason of any
nonperformance or delay, caused as aforesaid, in performance of any act or thing
that by the terms of the Deposit Agreement it is provided shall or may be done
or performed, or by reason of any exercise of, or failure to exercise, any
discretion provided for in the Deposit Agreement. Where, by the terms of a
distribution pursuant to Section 4.02, 4.03 or 4.05 of the Deposit Agreement
(which are summarized in paragraphs (14), (15) and (17), respectively, above))
or an offering or distribution pursuant to Section 4.04 of the Deposit Agreement
(which is summarized in paragraph (16) above), or because of applicable law,
such distribution or offering may not be made available to Holders, and the
Depositary may not dispose of such distribution or offering on behalf of such
Holders and make the net proceeds available to such Holders, then the Depositary
may make no such distribution or offering, and may allow any rights, if
applicable, to lapse.
(26) Resignation of the Depositary; Appointment of Successor
Depositary; the Custodian. The Depositary may at any time resign as Depositary
under the Deposit Agreement by 30 days' written notice of its election so to do
to the Company, such resignation to take effect
A-17
upon the appointment of a successor depositary and its acceptance of such
appointment as provided in the Deposit Agreement. The Depositary may at any time
be removed by the Company by 30 days prior written notice of such removal.
In case at any time the Depositary acting under the Deposit Agreement
resigns or is removed, the Company has agreed to use its best efforts to appoint
a successor depositary, which shall be a bank or trust company having an office
in the Borough of Manhattan, The City of New York. Any corporation into or with
which the Depositary may be merged or consolidated will be the successor of the
Depositary without the execution or filing of any document or any further act.
The Depositary, after consultation with the Company, will from time to
time appoint one or more agents to act for it as Custodian under the Deposit
Agreement. The Depositary has initially appointed Citibank, N.A., Manila, as
custodian and agent of the Depositary for the purpose of the Deposit Agreement.
The Custodian in acting under the Deposit Agreement will be subject at all times
and in all respects to the direction of the Depositary and will be responsible
solely to it.
The Custodian may resign and be discharged from its duties under the
Deposit Agreement by 30 days' prior notice of its election to do so delivered to
the Depositary; such resignation to become effective upon appointment of a
successor Custodian and its acceptance of such appointment as provided in the
Deposit Agreement. The Depositary may discharge any Custodian at any time upon
notice to the Custodian being discharged and appoint a substitute or an
additional custodian, who will thereafter be the Custodian under the Deposit
Agreement.
(27) Issuance of Additional Common Stock, Etc. In the event of any
issuance of additional Common Stock or of other securities (including rights and
convertible or exchangeable securities) as a dividend or distribution with
respect to the Common Stock or other Deposited Securities, or future issuances
to Holders for cash of additional Common Stock or such other securities, the
Depositary will not distribute any such additional Common Stock or other
securities to the Holders unless the Company shall have furnished to the
Depositary a written opinion from counsel for the Company in the United States,
which counsel shall be reasonably satisfactory to the Depositary, stating
whether or not the circumstances of such issue are such as to make it necessary
for a registration statement under the Securities Act to be in effect at or
prior to making such dividend or distribution available to the Holders entitled
thereto and, if in the opinion of such counsel a registration statement is
required, stating that there is a registration statement in effect which will
cover the issuance of such securities.
The Company has agreed with the Depositary that any future issuances of
(1) additional Common Stock, (2) rights, preferences or privileges to subscribe
for Common Stock, (3) securities convertible into or exchangeable for Common
Stock, or (4) rights, preferences or privileges to subscribe for securities
convertible into or exchangeable for Common Stock (in each case other than as a
dividend or distribution or issuance for cash to Holders as described in the
immediately preceding paragraph, shall be effected by the Company in a manner so
as to not violate the Securities Act. If the Company determines that an issuance
of such securities is required to be registered under the Securities Act, the
Company has agreed with the Depositary
A-18
to (x) register such issuance to the extent necessary, (y) alter the terms of
the issuance to avoid the registration requirements of the Securities Act or (z)
direct the Depositary to take such measures as are provided in Sections 4.03
through 4.05 of the Deposit Agreement (which are summarized as described in
paragraphs (15) through (17), respectively, above) or other specific measures
with respect to the acceptance for deposit of Common Stock to prevent such
issuance from being made in violation of the registration requirements of the
Securities Act.
The Company has agreed with the Depositary that neither the Company nor
any company controlling, controlled by or under common control with the Company
will at any time deposit any Common Stock, either upon original issuance or upon
a sale of Common Stock previously issued and reacquired by the Company or by any
such controlled or controlling company unless such transaction is registered
under the Securities Act or is exempt from registration under the Securities Act
as confirmed by a written opinion from counsel for the Company in the United
States, which counsel shall be reasonably satisfactory to the Depositary.
(28) Amendment. The form of this ADR and any provisions of the Deposit
Agreement may, with the consent of the Company, at any time and from time to
time be amended by the Depositary in any respect which it may deem necessary or
desirable. Any amendment which imposes or increases any fees or charges (other
than taxes and other governmental charges), or which otherwise prejudice any
substantial existing right of Holders, shall not, however, become effective as
to outstanding ADRs until the expiration of 90 days (or 30 days in the case of
any amendment which shall impose or increase any fees of the Depositary for the
issuance, execution and delivery of ADRs or any fees or expenses in respect of
transfer or sales of Common Stock or any delivery expenses and charges incurred
by the Depositary in the conversion of foreign currency and in connection with
foreign exchange control regulations) after notice of such amendment shall have
been given to the Holders of outstanding ADRs. Every Holder at the time any
amendment becomes effective shall be deemed by continuing to hold such ADR to
consent and agree to such amendment and to be bound by the Deposit Agreement as
amended thereby. In no event shall any amendment impair the right of any Holder
to surrender such Holder's ADRs and receive therefor the Deposited Securities
represented thereby or to request the Depositary to use reasonable efforts to
sell or cause to be sold Common Stock constituting Deposited Securities over a
stock exchange in the Philippines and to distribute the proceeds therefrom to
the persons entitled thereto, in any case except in order to comply with
provisions of applicable law.
(29) Termination. The Depositary will at any time at the direction of
the Company terminate the Deposit Agreement by mailing notice of such
termination to the Holders of all ADRs then outstanding at least 90 days prior
to the date fixed in such notice for such termination. The Depositary may
likewise terminate the Deposit Agreement if the Depositary delivers to the
Company a written notice of its election to resign, and a qualified successor
depositary shall not have been appointed and accepted its appointment as
provided in Section 5.04 of the Deposit Agreement (which is summarized in
paragraph (26) above) within 90 days after such delivery. If any ADRs remain
outstanding after the date of termination, the Depositary thereafter will
discontinue the registration of transfers of ADRs, will suspend the distribution
of
A-19
dividends to the Holders thereof, will not accept deposits of Common Stock (and
will instruct each Custodian to act accordingly), and will not give any further
notices or perform any further acts under the Deposit Agreement, except that the
Depositary will continue to collect dividends and other distributions pertaining
to Deposited Securities, will sell property and rights and convert Deposited
Securities into cash as provided in the Deposit Agreement, and will continue to
deliver Deposited Securities, together with any dividends or other distributions
received with respect thereto and the net proceeds of the sale of any Common
Stock, rights or other property (in all such cases, without liability for
interest), in exchange for ADRs surrendered to the Depositary. At any time after
the expiration of six months from the date of termination, the Depositary may
sell the Deposited Securities then held under the Deposit Agreement and may
thereafter hold the net proceeds of any such sale, together with any other cash
then held by it under the Deposit Agreement, without liability for interest, for
the pro rata benefit of the Holders of ADRs which have not theretofore been
surrendered. After making such sale, the Depositary will be discharged from all
obligations under the Deposit Agreement and the Company Agreement, except to
account for such net proceeds and other cash and for its obligations under the
indemnification provisions of Section 5.10 of the Deposit Agreement.
A-20
FOR VALUE RECEIVED, the undersigned Holder hereby sell(s), assign(s) and
transfer(s) unto _______________ whose taxpayer identification number is
_______________ and whose address including postal zip code is _______________
the within ADR and all rights thereunder, hereby irrevocably constituting and
appointing _______________ attorney-in-fact to transfer said ADR on the books of
the Depositary with full power of substitution in the premises.
Dated: Name:
---------------------------------------- ---------------------------------
By:
---------------------------------------- ---------------------------------
Title:
---------------------------------------- ---------------------------------
NOTICE: The signature of
the Holder to this
assignment must
correspond with the name
as written upon the face
of the within instrument
in every particular,
without alteration or
enlargement or any
change whatsoever.
---------------------------------------- ---------------------------------
SIGNATURE GUARANTEED
---------------------------------------- ---------------------------------
---------------------------------------- ---------------------------------
A-21