AMENDMENT NO. 1 TO DEPOSIT AGREEMENT
AMENDMENT
NO. 1 TO DEPOSIT AGREEMENT
AMENDMENT
NO. 1, dated
as
of June , 2007 (the “Amendment”), to the Deposit Agreement dated as of June 24,
2002 (as amended hereby, the “Deposit Agreement”), among XXX Participações S.A.
(fka Tele Celular Sul Participações S.A.),
incorporated under the laws of Federative Republic
of Brazil (the “Company”), JPMorgan Chase Bank, N.A., as depositary (the
“Depositary”), and all holders from time to time of American depositary receipts
(“ADRs”) issued thereunder.
WITNESSETH:
WHEREAS,
the Company and the Depositary executed the Deposit Agreement for the purposes
set forth therein; and
WHEREAS,
pursuant to paragraph (16) of the form of ADR contained in the Deposit
Agreement, the Company and the Depositary desire to amend the terms of the
Deposit Agreement and ADRs.
NOW,
THEREFORE, for
good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Company and the Depositary hereby agree to amend the Deposit
Agreement as follows:
ARTICLE
I
DEFINITIONS
SECTION
1.01. Definitions.
Unless
otherwise defined in this Amendment, all capitalized terms used, but not
otherwise defined, herein shall have the meaning given to such terms in the
Deposit Agreement.
ARTICLE
II
AMENDMENTS
TO DEPOSIT AGREEMENT
SECTION
2.01. All
references in the Deposit Agreement to the term “Deposit Agreement” shall, as of
the Effective Date (as herein defined), refer to the Deposit Agreement, dated
as
of June 24, 2002 as amended by this Amendment.
1
SECTION
2.02. Section
1(c) of the Deposit Agreement is amended by replacing "10,000" with
"ten".
SECTION
2.03. The
address of the Depositary set forth in Section 17(a) of the Deposit Agreement
is
amended to read as follows:
JPMorgan
Chase Bank, N.A.
Four
Xxx
Xxxx Xxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attention:
ADR Administration
Fax:
(000) 000-0000
SECTION
2.04. The
address of the Company set forth in Section 17(b) of the Deposit Agreement
is
amended to read as follows:
XXX
Participações S.A.
Xxxxxxx
xxx Xxxxxxxx, 0000, xxxxx 1, 5º andar
22640
000 Xxx xx Xxxxxxx - XX - Xxxxxx
Attention:
Xxxxx Xxxxxxx
Fax:
(00
00) 0000 0000
ARTICLE
III
AMENDMENTS
TO THE FORM OF ADR
SECTION
3.01. All
references in the form of ADR to the number of Shares represented
by each ADS is amended to reflect that each ADS represents ten
Shares.
SECTION
3.02. The
form
of ADR, reflecting the amendments set forth herein and other
clarifying amendments, is amended and restated to read as set forth as Exhibit
A
hereto.
ARTICLE
IV
REPRESENTATIONS
AND WARRANTIES
SECTION
4.01. Representations
and Warranties.
The
Company represents and warrants
to, and agrees with, the Depositary and the Holders, that:
2
(a)
This
Amendment, when executed and delivered by the Company, will be duly and validly
authorized, executed and delivered by the Company, and it and the Deposit
Agreement as amended hereby constitute the legal, valid and binding obligations
of the Company, enforceable against the Company in accordance with their
respective terms, subject to bankruptcy, insolvency, fraudulent transfer,
moratorium and similar laws of general applicability relating to or affecting
creditors’ rights and to general equity principles; and
(b)
In
order
to ensure the legality, validity, enforceability or admissibility into evidence
of this Amendment or the Deposit Agreement as amended hereby (collectively,
the
"Agreements"), neither of such Agreements need to be filed or recorded with
any
court or other authority in the Federative Republic of Brazil, nor does any
stamp or similar tax or governmental charge need to be paid in the Federative
Republic of Brazil on or in respect of such Agreements; provided, however,
prior
to enforcing these Agreement against the Company in the Federative Republic
of
Brazil these Agreements must be translated into Portuguese and registered
with
the Registry of Deeds and Titles in the Federative Republic of Brazil. Such
translation and registration can occur at any time prior to an action being
brought in the Federative Republic of Brazil and is not required for any
such
action to be brought against the Company in New York.
ARTICLE
V
MISCELLANEOUS
SECTION
5.01. Effective
Date.
This
Amendment is dated as of the date set forth above and shall be effective
as the
open of business New York time on July 3, 2007 (the “Effective
Date”).
SECTION
5.02. Outstanding
ADRs.
ADRs
issued prior or subsequent to the date hereof, which do not reflect the changes
to the form of ADR effected hereby, 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.
SECTION
5.03. Indemnification.
The
parties hereto shall be entitled to the benefits of the indemnification
provisions of Section 16 of the Deposit Agreement in connection with any
and all
liability it or they may incur as a result of the terms of this Amendment
and
the transactions contemplated herein.
SECTION
5.04. Counterparts.
This
Amendment may be executed in any number of counterparts, each of which shall
be
deemed an original and all of which taken together shall constitute one
instrument.
3
IN
WITNESS WHEREOF,
the
Company and the Depositary have caused this Amendment to be executed by
representatives thereunto duly authorized as of the date set forth
above.
XXX
PARTICIPAÇÕES S.A.
By:_____________________
Name:
|
|
Title:
|
JPMORGAN
CHASE BANK, N.A.
By:_____________________
Name:
|
|
Title:
|
4
EXHIBIT
A
ANNEXED
TO AND INCORPORATED
IN
AMENDMENT NO. 1 TO DEPOSIT AGREEMENT
[FORM
OF
FACE OF ADR]
No.
of
ADSs:
Number
Each
ADS
represents
10
Shares
CUSIP:
AMERICAN
DEPOSITARY RECEIPT
evidencing
AMERICAN
DEPOSITARY SHARES
representing
PREFERRED
SHARES, WITHOUT PAR VALUE
of
XXX
PARTICIPAÇÕES S.A.
(Incorporated
under the
laws
of
the Federative Republic of Brazil)
JPMORGAN
CHASE BANK, N.A., a national banking association organized under the laws
of the
United States, as depositary hereunder (the "Depositary"), hereby certifies
that
is the
registered owner (a "Holder") of
American
Depositary Shares ("ADSs"), each (subject to paragraph (13)) representing
ten
preferred shares, without par value (including the rights to receive Shares
described in paragraph (1), "Shares" and, together with any other securities,
cash or property from time to time held by the Depositary in respect or in
lieu
of deposited Shares, the "Deposited Securities"), of XXX
Participações S.A.,
a
corporation organized under the laws of Federative Republic of Brazil (the
"Company"), deposited under the Deposit Agreement dated as of June 24, 2002
(as
amended from time to time, the "Deposit Agreement") among the Company, the
Depositary and all Holders from time to time of American Depositary Receipts
issued thereunder ("ADRs"), each of whom by accepting an ADR becomes a party
thereto. The Deposit Agreement and this 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.
5
(1)
Issuance
of ADRs.
This
ADR is one of the ADRs issued under the Deposit Agreement. Subject to paragraph
(4), the Depositary may so issue ADRs for delivery at the Transfer Office
(defined in paragraph (3)) only against deposit with the Custodian of: (a)
Shares in form satisfactory to the Custodian; (b) rights to receive Shares
from
the Company or any registrar, transfer agent, clearing agent or other entity
recording Share ownership or transactions; or, (c) other rights to receive
Shares (until such Shares are actually deposited pursuant to (a) or (b) above,
"Pre-released ADRs") only if (i) Pre-released ADRs are fully collateralized
(marked to market daily) with cash or U.S. government securities held by
the
Depositary for the benefit of Holders (but such collateral shall not constitute
"Deposited Securities"), (ii) each recipient of Pre-released ADRs agrees
in
writing with the Depositary that such recipient (a) owns such Shares, (b)
assigns all beneficial right, title and interest therein to the Depositary,
(c)
holds such Shares for the account of the Depositary and (d) will deliver
such
Shares to the Custodian as soon as practicable and promptly upon demand therefor
and (iii) all Pre-released ADRs evidence not more than 30% of all ADSs
(excluding those evidenced by Pre-released ADRs), provided,
however,
that
the Depositary reserves the right to change or disregard such limit from
time to
time as it deems appropriate. The Depositary may retain for its own account
any
earnings on collateral for Pre-released ADRs and its charges for issuance
thereof. At the request, risk and expense of the person depositing Shares,
the
Depositary may accept deposits for forwarding to the Custodian and may deliver
ADRs at a place other than its office. Every person depositing Shares under
the
Deposit Agreement represents and warrants that such Shares are validly issued
and outstanding, fully paid, nonassessable and free of pre-emptive rights,
that
the person making such deposit is duly authorized so to do and that such
Shares
(A) are not "restricted securities" as such term is defined in Rule 144 under
the Securities Act of 1933 unless at the time of deposit they may be freely
transferred in accordance with Rule 144(k) and may otherwise be offered and
sold
freely in the United States or (B) have been registered under the Securities
Act
of 1933. Such representations and warranties shall survive the deposit of
Shares
and issuance of ADRs. The Depositary will not knowingly accept for deposit
under
the Deposit Agreement any Shares required to be registered under the Securities
Act of 1933 and not so registered; the Depositary may refuse to accept for
such
deposit any Shares identified by the Company in order to facilitate the
Company's compliance with such Act.
(2)
Withdrawal
of Deposited Securities.
Subject
to paragraphs (4) and (5) and to the provisions of or governing Deposited
Securities (including the Company's estatuto
or
applicable law), upon surrender of (i) a certificated ADR in form satisfactory
to the Depositary at the Transfer Office or (ii) proper instructions and
documentation in the case of a Direct Registration ADR, the Holder hereof
is
entitled to delivery at the Custodian's office of the Deposited Securities
at
the time represented by the ADSs evidenced by this ADR. At the request, risk
and
expense of the Holder hereof, the Depositary may deliver such Deposited
Securities at such other place as may have been requested by the Holder.
Notwithstanding any other provision of the Deposit Agreement or this ADR,
the
withdrawal of Deposited Securities may be restricted only for the reasons
set
forth in General Instruction I.A.(1) of Form F-6 (as such instructions may
be
amended from time to time) under the Securities Act of 1933. The Depositary
shall not deliver any Deposited Securities hereunder this paragraph (2) other
than upon receipt and cancellation of the respective ADRs.
6
(3)
Transfers
of ADRs.
The
Depositary or its agent will keep, at a designated transfer office in the
Borough of Manhattan, The City of New York (the "Transfer Office"), (a) a
register (the "ADR Register") for the registration, registration of transfer,
combination and split-up of ADRs, and, in the case of Direct Registration
ADRs,
shall include the Direct Registration System, which at all reasonable times
will
be open for inspection by Holders and the Company for the purpose of
communicating with Holders in the interest of the business of the Company
or a
matter relating to the Deposit Agreement and (b) facilities for the delivery
and
receipt of ADRs. The term ADR Register includes the Direct Registration System.
Title to this ADR (and to the Deposited Securities represented by the ADSs
evidenced hereby), when properly endorsed in the case of ADRs in certificated
form) or upon delivery to the Depositary of proper instruments of transfer,
is
transferable by delivery with the same effect as in the case of negotiable
instruments under the laws of the State of New York; provided
that the
Depositary, notwithstanding any notice to the contrary, may treat the person
in
whose name this ADR is registered on the ADR Register as the absolute owner
hereof for all purposes. Subject to paragraphs (4) and (5), this ADR is
transferable on the ADR Register and may be split into other ADRs or combined
with other ADRs into one ADR, evidencing the same number of ADSs evidenced
by
this ADR, by the Holder hereof or by duly authorized attorney upon surrender
of
this ADR at the Transfer Office properly endorsed (in the case of ADRs in
certificated form) or upon delivery to the Depositary of proper instruments
of
transfer and duly stamped as may be required by applicable law; provided
that the
Depositary may close the ADR Register at any time or from time to time when
deemed expedient by it or requested by the Company. 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)
Certain
Limitations.
Prior
to the issue, registration, registration of transfer, split-up or combination
of
any ADR, the delivery of any distribution in respect thereof, or, subject
to the
last sentence of paragraph (2), the withdrawal of any Deposited Securities,
and
from time to time in the case of clause (b)(ii) of this paragraph (4), the
Company, the Depositary or the Custodian may require: (a) payment with respect
thereto of (i) any stock transfer or other tax or other governmental charge,
(ii) any stock transfer or registration fees in effect for the registration
of
transfers of Shares or other Deposited Securities upon any applicable register
and (iii) any applicable charges as provided in paragraph (7) of this ADR;
(b)
the production of proof satisfactory to it of (i) the identity and genuineness
of any signature and (ii) such other information, including without limitation,
information as to citizenship, residence, exchange control approval, beneficial
ownership of any securities, compliance with applicable law, regulations,
provisions of or governing Deposited Securities and terms of the Deposit
Agreement and this ADR, as it may deem necessary or proper; and (c) compliance
with such regulations as the Depositary may establish consistent with the
Deposit Agreement and any regulations which the Depositary is informed of
in
writing by the Company which are deemed desirable by the Depositary, the
Company
or the Custodian to facilitate compliance with any applicable rules or
regulations of the Banco Central do Brasil (the "Central Bank") or Comissão de
Valores Mobiliários (the "Securities Commission"). The issuance of ADRs, the
acceptance of deposits of Shares, the registration, registration of transfer,
split-up or combination of ADRs or, subject to the last sentence of paragraph
(2), the withdrawal of Deposited Securities may be suspended, generally or
in
particular instances, when the ADR Register or any register for Deposited
Securities is closed or when any such action is deemed advisable by the
Depositary or the Company.
7
(5)
Taxes.
If any
tax or other governmental charge shall become payable by or on behalf of
the
Custodian or the Depositary with respect to this ADR, any Deposited Securities
represented by the ADSs evidenced hereby or any distribution thereon, such
tax
or other governmental charge shall be paid by the Holder hereof to the
Depositary. The Depositary may refuse to effect any registration, registration
of transfer, split-up or combination hereof or, subject to the last sentence
of
paragraph (2), any withdrawal of such Deposited Securities until such payment
is
made. The Depositary may also deduct from any distributions on or in respect
of
Deposited Securities, or may sell by public or private sale for the account
of
the Holder hereof any part or all of such Deposited Securities (after attempting
by reasonable means to notify the Holder hereof prior to such sale), and
may
apply such deduction or the proceeds of any such sale in payment of such
tax or
other governmental charge, the Holder hereof remaining liable for any
deficiency, and shall reduce the number of ADSs evidenced hereby to reflect
any
such sales of Shares. The Depositary will forward to the Company in a timely
fashion such information from its records as the Company may reasonably request
to enable the Company to file necessary reports with governmental authorities
or
agencies, and either the Company or the Depositary may file any such reports
necessary to obtain benefits under any applicable tax treaties for Holders.
The
Depositary shall cooperate with the Company in the Company's efforts to make
and
maintain arrangements enabling Holders to receive any tax credits or other
benefits (pursuant to treaty or otherwise) relating to dividend payments
on the
ADSs, and the Depositary shall, to the extent reasonably practicable, provide
the Company with such documents as the Company may reasonably request to
maintain such arrangements. In connection with any distribution to Holders,
the
Company will remit to the appropriate governmental authority or agency all
amounts (if any) required to be withheld and owing to such authority or agency
by the Company; and the Depositary and the Custodian will remit to the
appropriate governmental authority or agency all amounts (if any) required
to be
withheld and owing to such authority or agency by the Depositary or the
Custodian. If the Depositary determines that any distribution in property
other
than cash (including Shares or rights) on Deposited Securities is subject
to any
tax that the Depositary or the Custodian is obligated to withhold, the
Depositary may dispose of all or a portion of such property in such amounts
and
in such manner as the Depositary deems necessary and practicable to pay such
taxes, by public or private sale, and the Depositary shall distribute the
net
proceeds of any such sale or the balance of any such property after deduction
of
such taxes to the Holders entitled thereto.
(6)
Disclosure
of Interests.
To the
extent that the provisions of or governing any Deposited Securities may require
disclosure of or impose limits on beneficial or other ownership of Deposited
Securities, other Shares and other securities and may provide for blocking
transfer, voting or other rights to enforce such disclosure or limits, Holders
and all persons holding ADRs agree to comply with all such disclosure
requirements and ownership limitations and to cooperate with the Depositary
in
the Depositary's compliance with any Company instructions in respect thereof,
and the Depositary will use reasonable efforts to comply with such Company
instructions.
8
(7)
Charges
of Depositary.
The
Depositary may charge each person to whom ADSs are issued against deposits
of
Shares, including deposits in respect of Share Distributions, Rights and
Other
Distributions (as such terms are defined in paragraph (10)), and each person
surrendering ADSs for withdrawal of Deposited Securities, U.S. $5.00 for
each
100 ADSs (or portion thereof) delivered or surrendered. The Depositary may
sell
(by public or private sale) sufficient securities and property received in
respect of Share Distributions, Rights and Other Distributions prior to such
deposit to pay such charge. The following additional charges shall be incurred
by the Holders, by any party depositing or withdrawing Shares or by any party
surrendering ADRs or to whom ADRs are issued (including, without limitation,
issuance pursuant to a stock dividend or stock split declared by the Company
or
an exchange of stock regarding the ADRs or the Deposited Securities or a
distribution of ADRs pursuant to paragraph (10)), whichever is applicable
(i) a
fee of $.02 or less per ADS (or portion thereof) for any Cash distribution
made
pursuant to the Deposit Agreement, (ii) to the extent not prohibited by the
rules of any stock exchange or interdealer quotation system upon which the
ADSs
are traded, a fee of $1.50 per ADR or ADRs for transfers made pursuant to
paragraph (3) hereof and (iii) a fee for the distribution of securities pursuant
to paragraph (10) hereof, such fee being in an amount equal to the fee for
the
execution and delivery of ADSs referred to above which would have been charged
as a result of the deposit of such securities (for purposes of this paragraph
(7) treating all such securities as if they were Shares) but which securities
or
the net cash proceeds from the sale thereof are instead distributed by the
Depositary to Holders entitled thereto. The Company will pay all other charges
and expenses of the Depositary and any agent of the Depositary (except the
Custodian) pursuant to agreements from time to time between the Company and
the
Depositary, except (i) stock transfer or other taxes and other governmental
charges (which are payable by Holders or persons depositing Shares), (ii)
cable,
telex and facsimile transmission and delivery charges incurred at the request
of
persons depositing, or Holders delivering Shares, ADRs or Deposited Securities
(which are payable by such persons or Holders), (iii) transfer or registration
fees for the registration of transfer of Deposited Securities on any applicable
register in connection with the deposit or withdrawal of Deposited Securities
(which are payable by persons depositing Shares or Holders withdrawing Deposited
Securities; there are no such fees in respect of the Shares as of the date
of
the Deposit Agreement), (iv) expenses of the Depositary in connection with
the
conversion of foreign currency into U.S. dollars (which are paid out of such
foreign currency)and (v) such fees and expenses as are incurred by the
Depositary (including without limitation expenses incurred on behalf of Holders
in connection with compliance with foreign exchange control regulations or
any
law or regulation relating to foreign investment) in delivery of Deposited
Securities or otherwise in connection with the Depositary's or its Custodian's
compliance with applicable law, rule or regulation. These charges may be
changed
in the manner indicated in paragraph (16).
(8)
Available
Information.
The
Deposit Agreement, the provisions of or governing Deposited Securities and
any
written communications from the Company, which are both received by the
Custodian or its nominee as a holder of Deposited Securities and made generally
available to the holders of Deposited Securities, are available for inspection
by Holders at the offices of the Depositary and the Custodian and at the
Transfer Office. The Depositary will mail copies of such communications (or
English translations or summaries thereof) to Holders when furnished by the
Company. The Company is subject to the periodic reporting requirements of
the
Securities Exchange Act of 1934 and accordingly files certain reports with
the
United States Securities and Exchange Commission (the "Commission"). Such
reports and other information may be inspected and copied at public reference
facilities maintained by the Commission located at the date hereof at 000
X
Xxxxxx, XX, Xxxxxxxxxx, XX 00000.
9
(9)
Execution.
This
ADR shall not be valid for any purpose unless executed by the Depositary
by the
manual or facsimile signature of a duly authorized officer of the
Depositary.
Dated:
JPMORGAN
CHASE BANK, N.A., as Depositary
By
........................
The
Depositary's office is located at 0 Xxx Xxxx Xxxxx, Xxx Xxxx, Xxx Xxxx
00000.
10
[FORM
OF
REVERSE OF ADR]
(10)
Distributions
on Deposited Securities.
Subject
to paragraphs (4) and (5), to the extent practicable, the Depositary will
distribute by mail to each Holder entitled thereto on the record date set
by the
Depositary therefor at such Holder's address shown on the ADR Register, in
proportion to the number of Deposited Securities (on which the following
distributions on Deposited Securities are received by the Custodian) represented
by ADSs evidenced by such Holder's ADRs: (a) Cash.
Any
U.S. dollars available to the Depositary resulting from a cash dividend or
other
cash distribution or the net proceeds of sales of any other distribution
or
portion thereof authorized in this paragraph (10) ("Cash"), on an averaged
or
other practicable basis, subject to (i) appropriate adjustments for taxes
withheld, (ii) such distribution being impermissible or impracticable with
respect to certain Holders, and (iii) deduction of the Depositary's expenses
in
(1) converting any foreign currency to U.S. dollars by sale or in such other
manner as the Depositary may determine to the extent that it determines that
such conversion may be made on a reasonable basis, (2) transferring foreign
currency or U.S. dollars to the United States by such means as the Depositary
may determine to the extent that it determines that such transfer may be
made on
a reasonable basis, (3) obtaining any approval or license of any governmental
authority required for such conversion or transfer, which is obtainable at
a
reasonable cost and within a reasonable time and (4) making any sale by public
or private means in any commercially reasonable manner. (b) Shares.
(i)
Additional ADRs evidencing whole ADSs representing any Shares available to
the
Depositary resulting from a dividend or free distribution on Deposited
Securities consisting of Shares (a "Share Distribution") and (ii) U.S. dollars
available to it resulting from the net proceeds of sales of Shares received
in a
Share Distribution, which Shares would give rise to fractional ADSs if
additional ADRs were issued therefor, as in the case of Cash. (c) Rights.
(i)
Warrants or other instruments in the discretion of the Depositary representing
rights to acquire additional ADRs in respect of any rights to subscribe for
additional Shares or rights of any nature available to the Depositary as
a
result of a distribution on Deposited Securities ("Rights"), to the extent
that
the Company timely furnishes to the Depositary evidence satisfactory to the
Depositary that the Depositary may lawfully distribute the same (the Company
has
no obligation to so furnish such evidence), or (ii) to the extent the Company
does not so furnish such evidence and sales of Rights are practicable, any
U.S.
dollars available to the Depositary from the net proceeds of sales of Rights
as
in the case of Cash, or (iii) to the extent the Company does not so furnish
such
evidence and such sales cannot practicably be accomplished by reason of the
nontransferability of the Rights, limited markets therefor, their short duration
or otherwise, nothing (and any Rights may lapse). (d) Other
Distributions.
(i)
Securities or property available to the Depositary resulting from any
distribution on Deposited Securities other than Cash, Share Distributions
and
Rights ("Other Distributions"), by any means that the Depositary may deem
equitable and practicable, or (ii) to the extent the Depositary deems
distribution of such securities or property not to be equitable and practicable,
any U.S. dollars available to the Depositary from the net proceeds of sales
of
Other Distributions as in the case of Cash. Such U.S. dollars available will
be
distributed by checks drawn on a bank in the United States for whole dollars
and
cents (any fractional cents being withheld without liability and handled
in
accordance with the then current practices of the Depositary).
11
(11)
Record
Dates.
The
Depositary may, after consultation with the Company if practicable, fix a
record
date (which shall be as near as practicable to any corresponding record date
set
by the Company) for the determination of the Holders who shall be entitled
to
receive any distribution on or in respect of Deposited Securities, to give
instructions for the exercise of any voting rights, to receive any notice
or to
act in respect of other matters and only such Holders shall be so
entitled.
(12)
Voting
of Deposited Securities.
Under
the Brazilian Corporate Law (Law 6404 of December 15, 1976) and the by-laws
of
the Company on the date of the Deposit Agreement, the Shares have general
voting
rights only so long as the Company has failed for three consecutive fiscal
years
to pay a minimum dividend on the Shares of 25% of the Company's net profits;
otherwise the Shares have no voting rights in respect of any matters except
changes to the Company's capital structure which adversely affect the Shares.
As
soon as practicable after receipt from the Company of notice of any meeting
or
solicitation of consents or proxies of holders of Shares or other Deposited
Securities, the Depositary shall mail to Holders a notice stating (a) such
information as is contained in such notice and any solicitation materials,
(b)
that each Holder on the record date set by the Depositary therefor will be
entitled to instruct the Depositary as to the exercise of the voting rights,
if
any, pertaining to the Deposited Securities represented by the ADSs evidenced
by
such Holder's ADRs and (c) the manner in which such instructions may be given,
including instructions to give a discretionary proxy to a person designated
by
the Company. Upon receipt of instructions of a Holder on such record date
in the
manner and on or before the date established by the Depositary for such purpose,
the Depositary shall endeavor insofar as practicable and permitted under
the
provisions of or governing Deposited Securities to vote or cause to be voted
the
Deposited Securities represented by the ADSs evidenced by such Holder's ADRs
in
accordance with such instructions. The Depositary will not itself exercise
any
voting discretion in respect of any Deposited Securities.
(13)
Changes
Affecting Deposited Securities.
Subject
to paragraphs (4) and (5), the Depositary may, in its discretion, amend this
ADR
or distribute additional or amended ADRs (with or without calling this ADR
for
exchange) or cash, securities or property on the record date set by the
Depositary therefor to reflect any change in par value, split-up, consolidation,
cancellation or other reclassification of Deposited Securities, any Share
Distribution or Other Distribution not distributed to Holders or any cash,
securities or property available to the Depositary in respect of Deposited
Securities from (and the Depositary is hereby authorized to surrender any
Deposited Securities to any person and to sell by public or private sale
any
property received in connection with) any recapitalization, reorganization,
merger, consolidation, liquidation, receivership, bankruptcy or sale of all
or
substantially all the assets of the Company, and to the extent the Depositary
does not so amend this ADR or make a distribution to Holders to reflect any
of
the foregoing, or the net proceeds thereof, whatever cash, securities or
property results from any of the foregoing shall constitute Deposited Securities
and each ADS evidenced by this ADR shall automatically represent its pro
rata
interest in the Deposited Securities as then constituted.
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(14)
Exoneration.
The
Depositary, the Company, their agents and each of them shall: (a) incur no
liability (i) if law, regulation, the provisions of or governing any Deposited
Securities, act of God, war or other circumstance beyond its control shall
prevent, delay or subject to any civil or criminal penalty any act which
the
Deposit Agreement or this ADR provides shall be done or performed by it,
or (ii)
by reason of any exercise or failure to exercise any discretion given it
in the
Deposit Agreement or this ADR; (b) assume no liability except to perform
its
obligations to the extent they are specifically set forth in this ADR and
the
Deposit Agreement without gross negligence or bad faith; (c) in the case
of the
Depositary and its agents, be under no obligation to appear in, prosecute
or
defend any action, suit or other proceeding in respect of any Deposited
Securities or this ADR; (d) in the case of the Company and its agents hereunder
be under no obligation to appear in, prosecute or defend any action, suit
or
other proceeding in respect of any Deposited Securities or this ADR, which
in
its opinion may involve it in expense or liability, unless indemnity
satisfactory to it against all expense (including fees and disbursements
of
counsel) and liability be furnished as often as may be required; or (e) not
be
liable for any action or inaction by it in reliance upon the advice of or
information from legal counsel, accountants, any person presenting Shares
for
deposit, any Holder, or any other person believed by it to be competent to
give
such advice or information. The Depositary, its agents and the Company may
rely
and shall be protected in acting upon any written notice, request, direction
or
other document believed by them to be genuine and to have been signed or
presented by the proper party or parties. The Depositary and its agents will
not
be 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. The Depositary and its agents may own and deal in
any
class of securities of the Company and its affiliates and in ADRs. The Company
has agreed to indemnify the Depositary and its agents under certain
circumstances and the Depositary has agreed to indemnify the Company against
losses incurred by the Company to the extent such losses are due to the
negligence or bad faith of the Depositary. No disclaimer of liability under
the
Securities Act of 1933 is intended by any provision hereof.
(15)
Resignation
and Removal of Depositary; the Custodian.
The
Depositary may resign as Depositary by written notice of its election to
do so
delivered to the Company, or be removed as Depositary by the Company by written
notice of such removal delivered to the Depositary. The Depositary may appoint
a
substitute Custodian and the term "Custodian"
refers
to each such substitute Custodian; provided, however, that at no time without
the proper Brazilian governmental approvals shall the Depositary have more
than
one Custodian acting for it hereunder.
(16)
Amendment.
Subject
to the last sentence of paragraph (2), the ADRs and the Deposit Agreement
may be
amended by the Company and the Depositary, provided
that any
amendment that imposes or increases any fees or charges (other than stock
transfer or other taxes and other governmental charges, transfer or registration
fees, cable, telex or facsimile transmission costs, delivery costs or other
such
expenses), or that shall otherwise prejudice any substantial existing right
of
Holders, shall become effective 30 days after notice of such amendment shall
have been given to the Holders. Every Holder of an ADR at the time any amendment
to the Deposit Agreement so 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 the Holder of any ADR to surrender such ADR and receive the Deposited
Securities represented thereby, except in order to comply with mandatory
provisions of applicable law. Any amendments or supplements which (i) are
reasonably necessary (as agreed by the Company and the Depositary) in order
for
(a) the ADSs to be registered on Form F-6 under the Securities Act of 1933
or
(b) the ADSs or Shares to be traded solely in electronic book-entry form
and
(ii) do not in either such case impose or increase any fees or charges to
be
borne by Holders, shall be deemed not to prejudice any substantial rights
of
Holders. Notwithstanding the foregoing, if any governmental body should adopt
new laws, rules or regulations which would require amendment or supplement
of
the Deposit Agreement or the form of ADR to ensure compliance therewith,
the
Company and the Depositary may amend or supplement the Deposit Agreement
and the
ADR at any time in accordance with such changed rules. Such amendment or
supplement to the Deposit Agreement in such circumstances may become effective
before a notice of such amendment or supplement is given to Holders or within
any other period of time as required for compliance.
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(17)
Termination.
Upon
the resignation or removal of the Depositary pursuant to the Deposit Agreement,
the Depositary may, and shall at the written direction of the Company, terminate
the Deposit Agreement and this ADR by mailing notice of such termination
to the
Holders at least 30 days prior to the date fixed in such notice for such
termination. After the date so fixed for termination, the Depositary and
its
agents will perform no further acts under the Deposit Agreement and this
ADR,
except to receive and hold (or sell) distributions on Deposited Securities
and
deliver Deposited Securities being withdrawn. As soon as practicable after
the
expiration of six months from the date so fixed for termination, the Depositary
shall sell the Deposited Securities and shall thereafter (as long as it may
lawfully do so) hold in a segregated account the net proceeds of such sales,
together with any other cash then held by it under the Deposit Agreement,
without liability for interest, in trust for the pro rata
benefit
of the Holders of ADRs not theretofore surrendered. After making such sale,
the
Depositary shall be discharged from all obligations in respect of the Deposit
Agreement and this ADR, except to account for such net proceeds and other
cash.
After the date so fixed for termination, the Company shall be discharged
from
all obligations under the Deposit Agreement except for its obligations to
the
Depositary and its agents.
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