Exhibit 5(b)
XXXXX XXXX CADOT
NOTARY PUBLIC
[Illegible stamp and signature]
Record No. 13.817-2000
AGREEMENT
INMOBILIARIA E INVERSIONES HIDROINDUSTRIALES S.A.
AND
LQ INVERSIONES FINANCIERAS S.A.
AND
BANCO DEL ESTADO DE CHILE
IN XXXXXXXX DE CHILE, on December 20, 2000, the parties individualized
hereinbelow have appeared in my presence, XXXXX XXXX XXXXX, Notary Public, head
of the 41st Notary Public's Office in Santiago, domiciled at # 0000 Xxxxxxxxx
Xxxxxx, xxxxx 00, Xxxxxxxx xx Xxxxxxxx:
INMOBILIARIA E INVERSIONES HIDROINDUSTRIALES S.A., Tax Id No. 96.635.350-3,
hereinafter also designated "the debtor", hereby represented by Xx. XXXX
XXXXXXXX XXXXXXX XXXXXX, a Chilean citizen, married, civil industrial engineer,
National Id. Card No. 6.926.972-9 and by Xx. XXXXXXXXXX XXXXXXXX XXXXXXXX, a
Chilean citizen, married, lawyer, National Id. Card No. 7.012.089-5, all the
aforementioned domiciled at # 00 Xxxxxxx Xxxxxx Xxx Xxxxxx, xxxxx 00, Xxxxxxxx
xx Xxx Condes; LQ INVERSIONES FINANCIERAS S.A., Tax Id. No. 96.929.880-5,
hereinafter also designated "the Grantor", hereby represented by Xx. XXXX
XXXXXXXX XXXXXXX XXXXXX, a Chilean citizen, married, civil industrial engineer,
National Id. Card No. 6.926.972-9, both of them domiciled at # 20 Xxxxxxx Xxxxxx
Sur, floor 14, District of Las Condes; QUINENCO S.A., Tax Id No. 91.705.000-7,
hereby represented by Xx. XXXXXXXXX XXXXX XXXXXXXX, a Chilean citizen, married,
commercial engineer, National Id. Card No. 6.525.286-4, both of them domiciled
at # 00 Xxxxxxx Xxxxxx Xxx Xxxxxx, xxxxx 00, Xxxxxxxx of Las Condes; and BANCO
DEL ESTADO DE CHILE, an autonomous state-owned company, hereinafter also
designated "the Bank", hereby represented by Xx. XXXXXX XXXXXX XXXXX, a Chilean
citizen, married, commercial engineer, National Id. Card No. 7.706.983-6, both
of them domiciled at # 0000 Xxxxxxxxxx Xxxxxxxx X'Xxxxxxx Xxxxxx, Xxxxxxxx xx
Xxxxxxxx, xxx the
appearing parties of legal age, who have hereby evidenced their identities by
means of the Id. Cards individualized hereinabove and have represented as
follows:
ONE: Banco del Estado has granted a loan amounting to 727,000 Unidades de
Fomento(1) to INMOBILIARIA E INVERSIONES HIDROINDUSTRIALES S.A., which has been
documented by means of a Promissory Note No. 743380, executed by Debtor on the
date specified in the preamble hereof, for the amount referred to hereinabove.
QUINENCO S.A., on its part, undertook as guarantor and joint and several debtor
of the aforesaid note.
TWO: By means of a public deed granted at this Notary Public's Office on today's
date, LQ INVERSIONES FINANCIERAS S.A. undertakes the capacity of pledgor and
joint and several debtor of INMOBILIARIA E INVERSIONES HIDROINDUSTRIALES S.A. so
as to secure full and timely compliance with the aforementioned note referred to
under the foregoing clause before Banco del Estado de Chile. By means of the
same public deed, LQ INVERSIONES FINANCIERAS S.A. granted a stock pledge - as
per Law No. 4.287 - on 396,319,290 shares issued by BANCO DE X. XXXXXXX, so as
to secure compliance with the obligations undertaken with the Bank as a result
of the guarantee and joint and several debt specified hereinabove. The parties
intend that the pledge serves as a surety for the aforementioned loan since,
through the guarantee and joint and several debt, such loan shall also account
for an indirect debt for LQ INVERSIONES FINANCIERAS S.A.
THREE: The appearing parties hereby agree that, for the aforementioned loan to
be properly secured, a ratio between the pledged stocks and the effective amount
of the loan amounting to 1.5 to 1 shall be kept. In other words, the total value
of pledged shares shall be equivalent to 1.5 times the amount of the loan.
Pledged shares value shall be deemed to be the lowest of: a) the average closing
price of issuer's stocks at the Xxxxxxxx Stock Exchange corresponding to the
180-day period prior to the date on which price is determined and b) the average
closing price of shares at the Xxxxxxxx Stock Exchange along the 30 days prior
to price determination. The aforesaid measurement shall be carried out on a
monthly basis, on the first working day of every month.
FOUR: Should the surety / debt ratio drop below the 1.25:1 level, Debtor and/or
Grantor shall, upon the Bank's discretion and within the 30-day term following
notification therefrom, grant a stock pledge on a higher number of shares issued
by BANCO DE X. XXXXXXX or other stocks acceptable for the Bank, or Debtor and/or
Grantor shall make an advance payment of the loan so that the aforementioned
ratio regains the 1.5:1 level. On an alternative basis and within the same term,
Debtor and/or Grantor shall be entitled to make term deposits at the Bank as
accommodation endorsements, on a 1:1 surety / debt ratio basis, so that the
aforementioned ratio regains the required level. Should the aforementioned fail
to be achieved within the required term, Banco del Estado de Chile shall be
irrevocably entitled to transfer a portion or the entire amount of the pledged
shares and to allocate the product to paying the loan in advance, so that the
surety / debt ratio regains the 1.5:1 level. LQ INVERSIONES FINANCIERAS S.A. and
INMOBILIARIA E INVERSIONES HIDROINDUSTRIALES S.A. hereby grant a special and
irrevocable power of attorney to Banco del Estado de Chile, on behalf of which
its representative hereby accepts the power to act accordingly.
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(1) Unidad de Fomento - UF - a Chilean, non-physical indexed monetary unit.
2
FIVE: Should the surety / debt ratio rise above the 1.75 level along three
consecutive measurements, Debtor and/or Grantor shall require release of pledge
for as many shares as necessary for having such ratio regain the 1.5:1 level.
SIX. Should the stocks of BANCO DE X. XXXXXXX be no longer able to be valued by
means of the mechanism referred to under clause three herein, the Bank shall be
entitled to require Debtor replacement thereof for by other shares deemed to be
satisfactory thereto and complying with the aforementioned requirement. The
replacement pledge shall be granted within a 30-working day term as of notice
from the Bank. In addition, Debtor shall be entitled to request replacement of
the pledged BANCO DE X. XXXXXXX stocks for by shares corresponding to another
company, which the Bank considers acceptable or for term deposits as
accommodation endorsements, where the latter have a 1:1 surety / debt ratio.
SEVEN. INMOBILIARIA E INVERSIONES HIDROINDUSTRIALES S.A. hereby undertakes
before the Bank, on behalf of which accepts its representative, to keep a debt
ratio - measured as the quotient resulting from the current liabilities divided
by net worth - not exceeding 2.75 times. Should Debtor exceed the aforementioned
level, it shall correct such situation within the following 45-day term.
EIGHT: QUINENCO S.A., in turn, in its capacity of guarantor and joint and
several debtor of the note securing the loan referred to under clause one
herein, hereby undertakes as follows before Banco del Estado de Chile: a)
Keeping assets free from all and every encumbrances, collaterals, burdens,
restrictions or privileges for an amount equivalent to at least 1.3 times the
outstanding balance of all the unsecured debts held by Quinenco S.A. For these
purposes, both assets and debts shall be valued at book value; b) Keeping an
individual indebtedness level whereby the financial debt / total capital
formation ratio not exceeding 0.45 times. To this end, financial debt shall be
construed as the addition of lots 21,010; 21,015; 21,020; 21,025; 21,030;
21,060; 21,075; 22,010; 22,020; 22,030; 22,040 and 22,045 of Quinenco's
individual FECU. Total capital formation shall be construed as the addition of
individual net worth, plus financial debt; c) Keeping a minimum individual net
worth of at least UF 33 million. The aforementioned obligations, as well as that
provided in the clause hereinabove shall remain in full effect for as long as
the relevant loan remains unpaid.
NINE: Banco del Estado de Chile shall be entitled to require advance payment of
all and every pending obligations held by INMOBILIARIA E INVERSIONES
HIDROINDUSTRIALES S.A. therewith. Further the Bank shall be entitled to demand
the payment of the pledge, guarantee and surety as specified under clauses one
and two herein in any of the following cases: a) In the event Debtor and/or
Quinenco S.A. fail to fully and timely comply with the obligations undertaken
thereby by means of this instrument; b) Should Quinenco's current major
stockholders loose control of such company.
TEN: Debtor shall be able to pay the loan referred to under clause one herein in
advance, with no fee being applicable thereto, provided that the following
requirements are complied with: a) Notifying the Bank in writing, at least 90
days in advance to the date on which it intends to make the relevant advance
payment; b) As of January 15, 2002, it shall be able to pay in advance as much
as 50 per cent of the owed principal. Said advance payment shall only be carried
out on any day between January 15 and January 31, 2002. Following such date,
payment shall only be performed on interest payment dates; c) As of January
3
15, 2003, Debtor shall be able to pay up to 100 per cent of owed principal. The
aforesaid advance payment shall only be carried out on any day between January
15 and January 31, 2003. Following such date, payment shall only be performed on
interest payment dates.
ELEVEN: For all the legal purposes stemming from this instrument, the appearing
parties hereby establish their domicile in the city and district of Santiago
and, consequently, shall subject to the jurisdiction of the Courts of Justice
located therein.
TWELVE: All and every expenses resulting from this deed shall be exclusively
born by Xxxxxx.
The power of Xx. Xxxx Xxxxxxxx Xxxxxxx Xxxxxx and Xx. Xxxxxxxxxx Xxxxxxxx
Xxxxxxxx to act on behalf of INMOBILIARIA E INVERSIONES HIDROINDUSTRIALES S.A.
is evidenced by means of a public deed dated October 29, 1998 granted at the
Santiago Notary Public's Office of Xx. Xxxxxx Xxxxx Xxxxxx. The power of Xx.
Xxxx Xxxxxxxx Xxxxxxx Xxxxxx to act on behalf of LQ INVERSIONES FINANCIERAS S.A.
is evidenced by means of public deeds dated December 13 and December 15, 2000,
both of them granted at the Santiago Notary Public's Office of Xx. Xxxx
Xxxxxxxxx Xxxx. The power of Xx. Xxxxxxxxx Xxxxx Xxxxxxxx to act on behalf of
QUINENCO S.A. is evidenced by means of a public deeds dated December 12, 2000,
granted at the Santiago Notary Public's Office of Xx. Xxxx Xxxxxxxxx Xxxx. The
power of the Bank's representative is evidenced by means of a public deed dated
June 7, 1996, granted at the Santiago Notary Public's Office of Xx. Xxxxx Xxxxxx
Xxxxxxxxxx.
This agreement has been prepared by counsel XXXXXX XXXXX XXXXXX. In witness
whereof, the parties sign this document having one single date and effect.
Counterparts are provided. Registered under Record No. 13.817.
In witness whereof I have hereunto affixed my hand and seal.
(Signature illegible)
XXXX XXXXXXXX XXXXXXX XXXXXX
National Id. Card No. 6.926.972-9
(Signature illegible)
XXXXXXXXXX XXXXXXXX XXXXXXXX
National Id. Card No. 7.012.089-5
(Signature illegible)
XXXXXXXXX XXXXX XXXXXXXX
National Id. Card No. 6.525.286-4
(Signature illegible)
XXXXXX XXXXXX XXXXX
National Id. Card No. 7.706.983-6
By proxy BANCO DEL ESTADO DE CHILE
4
(Signature and stamp illegible)
(Stamp: Banco del Estado de Chile - Group Head - Major Corporations; Signature
illegible).
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