CONTRACT OF LEGAL REPRESENTATION OF BONDHOLDERS BETWEEN PROMIGAS S.A. E.S.P. AND HELM FIDUCIARIA S.A.

Transcription

1 CONTRACT OF LEGAL REPRESENTATION OF BONDHOLDERS BETWEEN PROMIGAS S.A. E.S.P. AND HELM FIDUCIARIA S.A. The undersigned, AQUILES MERCADO GONZALEZ, of legal age, identified with Colombian National ID Card No issued in Puerto Colombia, acting as Legal Representative for PROMIGAS S.A. E.S.P., a company hereinafter referred to as THE ISSUER, for one of the parties, and, the other, CESAR AUGUSTO PAEZ MENDOZA, identified with the Colombian National ID Card No , issued in Bogota, acting as Alternate of the President and therefore as legal representative of HELM FIDUCIARIA S.A., a fiduciary company domiciled in the city of Bogota, constituted by public deed number 6128 on September 23, 1991 at the Notary Public 18 in Bogota, and duly authorized to enter into the present contract, and accredited by a certificate issued by the Superintendence of Finance of Colombia, that is attached to the present contract and who hereinafter will be referred to as THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS, and together the Parties, agree to sign the present contract which is governed by the following clauses and for those matters not covered by them, by the provisions in Decree 2555 of 2010 and all other rules that modify or add to the decree, the Commerce Code and the special laws that regulate the matter: CLAUSE ONE: ISSUANCE OF BONDS. THE ISSUER will issue Ordinary Bonds that will be termed PROMIGAS S.A. E.S.P ORDINARY BONDS, for an amount of up to FIVE HUNDRED AND EIGHTY BILLION COLOMBIAN PESOS LEGAL CURRENCY ($580,000,000,000), in order to be placed in public securities market in compliance with decree 2555 of 2010, as stated in the respective Prospectus that is an integral part of this contract. The issue of ordinary bonds will be done in a dematerialized form and will be administered by the DECEVAL S.A. (Central Securities Deposit) Any modification to the conditions established in the Prospectus should be communicated fifteen (15) business days in advance of the intent to make the modification to THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS, to either agree to the new conditions of the contract or to resign from the Legal Representation of the Ordinary Bondholders, as set forth in Clause Twelve in this document. CLAUSE TWO: OBJECT. The object of the present contract is to regulate the relationship between the THE ISSUER AND THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS and 1

2 to determine the obligations it must assume with the ordinary bondholders when the bonds are issued by THE ISSUER. CLAUSE THREE: LEGAL REPRESENTATION OF BONDHOLDERS. HELM FIDUCIARIA S.A. is designated as legal representative of the ordinary bondholders. Paragraph: THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS, declares they have the power to sign and carry out the purpose of the present contract and that they are not involved in any of the situations referred to in Article of Decree 2555 of 2010 (Unique Decree) which would impede them to act as such. CLAUSE FOUR: RIGHTS OF THE ISSUER. In addition to those embodied in the existing provisions and in the Information Leaflet, THE ISSUER will have the following rights: 1. Receive timely feedback about the development in the tasks of THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS. 2. Receive indications and comments that THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS formulates, aimed at the best execution of the present contract. 3. Require that THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS convenes the General Assembly of Ordinary Bondholders in agreement to the selected terms in the Prospectus and in the Decree 2555 of 2010 and if they fail to do so request that the Financial Superintendence of Colombia calls the meeting. CLAUSE FIVE: OBLIGATIONS OF THE ISSUER. The following will be obligations of THE ISSUER: 1. Comply with the obligations referred to in the Prospectus and those arising from the Decree 2555 of 2010, and all other additional rules, related to the issue of bonds and/or subject matters from the present contract. 2. Provide THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS all the information that is required for them to carry out their duties and let them inspect, with prior written notice and in the business hours of THE ISSUER, to the extent necessary for the same purpose, their books and documents. Similarly, THE ISSUER henceforth orders his fiscal auditor to supply all the information that is required to THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS so that he may exercise his duties, in agreement with item 3 of article of Decree 2555 of Pay THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS the agreed remuneration, in accordance with the provisions in this contract. 4. Be held accountable for the fulfillment of the commitments made in relation to the issuing of bonds, in accordance with that which has been established in the Prospectus. 2

3 5. Cover the expenses that are incurred in the convening and activities of the General Assembly of Ordinary Bondholders, in accordance with the article of Decree 2555 of These expenses will be covered directly by THE ISSUER. 6. Inform the Financial Superintendence of Colombia and THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS any situation or circumstance that constitutes an issue of Relevant Information according to the terms of Article of Decree 2555 of Comply with all duties to report information and all other obligations that are derived from the registration in the National Registry of Securities and Issuers. 8. Comply with all obligations that appear in the Prospectus, and any other contract signed as part of the bond issuing process, as well as all others that correspond by law. 9. Deposit the global bond for the bonds to be issued with DECEVAL S.A. (Centralized Securities Deposit). 10. Present the information of THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS in a truthful manner in any publication. 11. Send each month to THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS, for the duration of the present contract, a statement of the quantity of bonds placed, name of subscriber and number of securities. 12. Invite THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS to all Shareholder Meetings. 13. Supply THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS the necessary resources in order to carry out all administrative and maintenance duties that are necessary for the exercise of the rights and defense of the common interests of the ordinary bondholders, including professional fees that must be paid to a lawyer in case they are needed to be hired in order to intervene, in defense of the rights of the ordinary bondholders in judicial processes when those rights are not recognized. In such a case, THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS, before agreeing to the above mentioned fees, must obtain a written authorization from THE ISSUER, regarding the amount of the fees that may be agreed and the form of payment. In the event that the authorization isn t offered within ten business days from the request presented by THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS, it shall be allowed to carry out the hiring according to the submitted fees request. 14. Register the appointment of the new Legal Representative of the bondholders in the commercial registry of the Chamber of Commerce of the registered address of THE ISSUER immediately they are appointed, following the prior acceptance of the resignation 3

4 of the LEGAL REPRESENTATIVE OF THE BONDHOLDERS or at his removal or at the termination of the contract of representation and submit within twenty (20) days following the signing of the present contract the certificate of the Chamber of Commerce where said appointment is made, the foregoing in accordance with that indicated in article of Decree 2555 of July, CLAUSE SIX: FUNCTIONS OF THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS. In addition to those provided under law, THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS will have the following powers: 1. To execute all the acts of conservation and administration which are necessary to exercise the rights and the defense of the common interests of the ordinary bondholders. 2. Carry out dispositions for which the General Assembly of Ordinary Bondholders legally empowers them. 3. Act on behalf of the bondholders in judicial or bankruptcy processes or by arrangement, in business restructure agreement plans provided for under law 550 of 1999 or Law 1116 of 2006, as applicable, and also in those that are brought forward as a consequence of the seizure of possession of properties and assets or the administrative intervention of THE ISSUER. For this purpose, THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS must take part in the respective process within legal terms, for which they shall accompany said request, as proof of credit, an authentic copy of the contract of the legal representation of bondholders and evidence based on their records about the outstanding amount of the loan and its interest. 4. Represent the ordinary bondholders in everything regarding their common or collective interests. 5. Summon and preside over The General Assembly of Ordinary Bondholders, and will put himself forward as President of said Assembly. 6. Request from the Financial Superintendence of Colombia, with respect to the Issuer, and within competence of that Superintendence, reports from the case and the indispensable reviews of the accounting books and other documents of the issuing Company. 7. Inform the ordinary bondholders and the Financial Superintendence of Colombia as soon as possible and through suitable methods, of any failure of compliance of the obligations of THE ISSUER or the existence of any circumstance that causes a reasonable fear of that said non-compliance will occur, such as any event that affects or may significantly affect the financial situation and/or the legal situation of THE ISSUER. Said information will take place within ten (10) business days following it being brought to the attention of THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS of the occurrence of said noncompliance. 4

5 8. THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS must comply with each and every one of the obligations that arise from the Prospectus and with any other obligation that the existing laws require. 9. The LEGAL REPRESENTATIVE OF THE BONDHOLDERS must maintain confidentiality concerning the reports that are received with respect to THE ISSUER and is prohibited to reveal or divulge information and details about the business that wasn t strictly essential for the safeguarding of the interests of the ordinary bondholders. 10. Approach the Financial Superintendence of Colombia, so that if it sees fit, it can request from the issuing entity the constitution of special guarantees and the adoption of methods of preservation and security of the encumbered assets as requested by the General Assembly of Ordinary Bondholders. 11. Report to the competent authorities any irregularities that may compromise the safety of the interests of the ordinary bondholders. 12. Be informed of the fees for service. 13. Render audited accounts of their work at least once every six months which shall be sent to THE ISSUER by or by the means selected by THE FIDUCIARY always proceeding with a digital signature. 14. All others designated in the article of the Decree 2555 of First Paragraph: In the event that, from the obtained information, THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS concludes that it is necessary to examine the books of THE ISSUER or request additional information, THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS shall formulate the requirements of the case directly to THE ISSUER. Second Paragraph: Unless it concerns the information that is referred to in Paragraph 9 of the present clause, THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS must maintain confidentiality concerning the reports that they receive from the Financial Superintendence of Colombia or from any other authority with regard to THE ISSUER and is prohibited from revealing or divulging information and details about the business that wasn t strictly essential for the safeguarding of the interests of the ordinary bondholders. CLAUSE SEVEN: In exercise of their functions as REPRESENTATIVE OF THE BONDHOLDERS, they must adopt the following rules of conduct: 5

6 a. Act in the ways established in the rules of decree 2555 of 2010, and in the other existing provisions, revealing in a proper and timely way to the Financial Superintendence of Colombia and the ordinary bondholders, all relevant information about the ISSUER and/or themselves. b. Refrain from conducting operations where a real or potential conflict of interest exists which goes against the interests of the ordinary bondholders and that ignores common and collective interests or the execution of conservation and administrative acts in detriment to the rights and the defense of the interests of each and every one of them, benefitting individual interests from the conduct. c. Inform the Financial Superintendence of Colombia immediately about any situation or event that could imply a conflict of interest in their actions against the interests of ordinary bondholders. In accordance with article of Decree 2555 of 2010, a conflict of interest is defined as a situation in which a person is faced with different options of conduct with relation to incompatible interests, neither of which favor the interests of legal or contractual obligations. For legal representatives of the bondholders, it is considered that, among other behaviors, a conflict of interest is when a situation involves a selection between: 1. Private gain and that of ordinary bondholders they are representing. 2. The benefit of the parent or controlling company itself and the benefit of the ordinary bondholders. 3. The benefit of another subordinate entity to the same parent or controlling company and the usefulness or benefit to ordinary bondholders. 4. The benefit of a related third party to THE REPRESENTATIVE OF THE HOLDERS and the usefulness or benefit of said benefit to ordinary bond holders. 5. The benefit of another client or group of clients of the entity and the usefulness or benefit of the ordinary bondholders. Paragraph: In this case, the REPRESENTATIVE OF THE HOLDERS shall be suspended, without generating any responsibility in the form of REPRESENTATIVE OF THE HOLDERS, until the Financial Superintendence of Colombia decides. d. Be inhibited from the exercise of legal representation of the holders issued by any entity in respect of which exists one of the marked ineligibilities in the article of Decree 2555 of e. Abstain from giving any preferential treatment to a holder or group of ordinary bondholders in respect to the others. 6

7 f. Convene the assembly of ordinary bondholders when considered applicable, when requested by THE ISSUER or a plural number of bondholders that represents no less than ten percent (10%) of the bonds in circulation. In the case of reluctance of the REPRESENTATIVE OF THE HOLDERS in conducting said hearing, those same bondholders will be able to request the Financial Superintendence of Colombia to conduct the hearing. g. Convene the Assembly of ordinary bondholders, in order to decide on a replacement, when in the course of the issuance a situation is found which prohibits the entity in order to continue acting as its representative. Said hearing must take place within five (5) business days following the occurrence or knowledge of said situation. h. Avoid any conduct that in accordance with the legal standards and/or the concept of the Financial Superintendence of Colombia endanger the adequate exercise of the functions as REPRESENTATIVE OF THE BONDHOLDERS. i. Convene the Assembly of the Ordinary Bondholders, when ordered by the Financial Superintendence of Colombia in the cases in which serious circumstances exist that must be known by the Ordinary Bondholders and that can determine that instructions be given to THE REPRESENTATIVE OF THE HOLDERS or that his nomination be revoked. j. Request THE ISSUER to make an issuance of definite bonds to the Ordinary Bondholders in the event that the Deposit Contract is terminated in an anticipated manner in accordance with the terms stated therein and THE ISSUER doesn t designate a new entity to act as Depositor before the next payment date, in accordance with that established in the Prospectus. CLAUSE EIGHT: DURATION. The duration term of this contract will correspond to the total repayment of the capital from the securities, in accordance with the Prospectus annex and two (2) additional calendar months. CLAUSE NINE: RESPONSIBILITY. THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS is responsible for even slight negligence in the performance of his duties. CLAUSE TEN: REMOVAL. THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS can be removed at any moment by the General Assembly of the Ordinary Bondholders and in that case the present contract will automatically become terminated bearing in mind the provisions in the thirteenth clause. CLAUSE ELEVEN: REMUNERATION. THE ISSUER will recognize THE REPRESENTATIVE OF THE BONDHOLDERS, during the validity of the present contract and starting from 7

8 the first notice of offer of issuance, a commission equivalent to TWO (2) Colombian Monthly Minimum Wages, liquidated monthly and payable monthly or by a fraction per month. The invoice must be paid within thirty (30) calendar days following the date of submission; prior submission and approval on part of the Issuer of the invoice or respective bill issued by HELM FIDUCIARIA S.A. In the event that the invoices are not paid within the aforementioned term, a penalty interest rate will be charged that is the highest permitted by law. THE ISSUER expressly accepts that the certification concerning the amount of the remuneration owed to THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS signed by the Legal Representative and the Statutory Auditor of THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS, together with this contract, will have sufficient power to charge THE ISSUER and hereby waive any rights to default interest. First Paragraph: THE ISSUER will be responsible for all costs and expenses that are generated from the bond issuance. Additionally they will cover all the expenses that are derived from the meeting of the General Assemblies of Bondholders, be they ordinary or extraordinary. Second Paragraph: The modification of the commission and its payment date only requires an agreement from THE ISSUER and from THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS. CLAUSE TWELVE: RESIGNATION. THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS shall resign from the designation made by THE ISSUER in any of the following events: 1. When, with prior certification from the Financial Superintendence of Colombia, serious motives are presented that impede the fulfillment of the obligations before the ordinary bondholders and/or before THE ISSUER. 2. When during the act of maintaining the representation of the ordinary bondholders, there is a serious detriment to their interests or the fulfillment of the contract becomes excessively burdensome. 3. Dissolution of HELM FIDUCIARIA S.A. 4. For non-compliance of THE ISSUER in the payment of the stipulated remuneration, upon prior written notification by HELM FIDUCIARIA S.A. 8

9 5. On proving the concealment or false submission of reports by THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS. CLAUSE THIRTEEN. REGISTRATION. THE ISSUER shall register the designation of THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS in the Business Registry in the Chamber of Commerce from the registered address of THE ISSUER. This appointment will remain in effect with respect to THE ISSUER, the ordinary bond holders and third party members until a new representative is elected under the premise of resignation or removal. In any case, THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS will remain obligated to fulfill their duties, while a new appointment is made and a new registration is completed. CLAUSE FOURTEEN: CONVENING OF THE GENERAL ASSEMBLY OF THE BONDHOLDERS. The execution of the Assemblies of Bondholders will be governed by the legal norms established for this effect by the Financial Superintendence of Colombia. The convening for the Assemblies of Ordinary Bondholders shall be prominently made in the newspapers El Tiempo and/or La Republica and/or Portafolio, or any other suitable method at the discretion of the Financial Superintendence of Colombia that equally guarantees the widest distribution of the notice, eight (8) business days before the meeting, informing the Ordinary Bondholders if it is the first, second, or third notice, or the time that is pointed out in the Decree 2555 of 2010, the place, the date, the time and the agenda of the assembly and any other information or precaution that must be known in agreement with the provisions in the Decree 2555 of The applicable standards for the holding of said assemblies shall be in accordance with Decree 2555 of 2010 and the standards that modify, add, or replace it and the Prospectus where applicable. The meetings of the assembly of ordinary bondholders will be carried out in the city of Bogota, at the place that is indicated in the notice. CLAUSE FIFTEEN: DISPOSALS. Any disposal, lien, embargo and other limitations to the right will only take effect with respect from THE ISSUER, THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS and third-party members, when any of these situations are formalized they shall conform to that which is established by the law and the Prospectus. CLAUSE SIXTEEN: ACCOUNTS AND RECORDS. THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS shall in accordance with the legal standards, in memorandum accounts, separate accounts and records of the development of the issue referred to herein. 9

10 CLAUSE SEVENTEEN: STAMP DUTY. For the purpose of the present contract stamp duty it is considered that to be an undetermined amount. In the event that said duty is generated, THE ISSUER will assume the corresponding costs. CLAUSE EIGHTEEN: Taking into account the provisions in External Circular No. 038 of June 18, 1997 issued by the Banking Superintendence now known as the Financial Superintendence of Colombia, THE ISSUER is obligated to annually update the information set out in the form that to this effect will be sent to THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS, and as well providing the relevant, required documents. CLAUSE NINETEEN: RISK MANAGEMENT. HELM FIDUCIARIA S.A. uses special administration systems to manage Market, Credit, and Operational Risk along with Money Laundering Prevention and the Funding of Terrorist Activities which are implemented in the fiduciary business conducted by the Company through the implementation of the current standards. In any case the parties affirm that they understand and accept that risk management is the excepted in the current state of business, but is not limited given that in the development and execution of the Fiduciary Agreement situations can be presented that generate new risks which will be mitigated by the mechanisms that the parties agree upon. CLAUSE TWENTY: CONFLICT OF INTEREST. The present contract has been evaluated in respect to the existence of any possible conflict of interest which is established in paragraph 9, Article 146 of the E.O.S.F. (Organic Statute of the Financial System) and as a result of said evaluation it was found that there was no conflict of interest of these characteristics. As it is foreseen as a mechanism in order to avoid any situation that involves a conflict of interest in the terms of paragraph 9, article 146 of the E.O.S.F., in the event that a conflict of interest occurs during the execution of business, the following procedure will happen: the conflict of interest shall be identified, said conflict will be made known to the Fiduciary Management, so it can be determined if it exists and the relevant decisions shall be taken to manage it. CLAUSE TWENTY ONE: ADDRESS FOR NOTIFICATIONS. For all purposes the parties will have the following addresses: THE ISSUER: Calle 66 No , in the city of Barranquilla. Telephone: Fax:

11 THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS: Carerra 7 No th Floor Bogota Telephone: Fax: CLAUSE TWENTY TWO: ANNEXES. They form an integral part of the present contract. 1. The certificates of existence and representation of the parties. 2. All communications that are generated in the development of the present contract. 3. Prospectus for Ordinary Bonds. 4. Copy of the Resolution issued by the Financial Superintendence of Colombia. CLAUSE TWENTY THREE: REGISTERED ADDRESS. For all legal and contractual purposes the parties have set the city of Bogota as the registered address. CLAUSE TWENTY FOUR: MODIFICATION. The present contract may be modified by the parties provided that they do not negatively affect the interests of THE BONDHOLDERS and that the intended modification is previously published on the website of THE LEGAL REPRESENTATIVE OF THE BONDHOLDERS. For the record it is signed in three (3) copies, in the city of Bogota, on August the Thirtieth (30 th ) two thousand and twelve (2012). THE ISSUER THE LEGAL REPRESENTATIVE OF BONDHOLDERS AQUILES MERCADO GONZÁLEZ C.C. No of Puerto Colombia LEGAL REPRESENTATIVE PROMIGAS S.A. E.S.P CESAR AUGUSTO PAEZ MENDOZA C.C. No of Bogotá LEGAL REPRESENTATIVE HELM FIDUCIARIA S.A. 11