MERCANTIL SERVICIOS FINANCIEROS, C.A. AND JPMORGAN CHASE BANK, N.A., As Depositary AND HOLDERS OF AMERICAN DEPOSITARY RECEIPTS Deposit Agreement Dated as of August 1, 1997 as Amended and Restated as of December , 2006
AND
JPMORGAN
CHASE BANK, N.A.,
As
Depositary
AND
HOLDERS
OF AMERICAN DEPOSITARY RECEIPTS
Deposit
Agreement Dated as of August 1, 1997 as
Amended
and Restated as of December , 2006
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TABLE
OF CONTENTS
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Page
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PARTIES
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1
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RECITALS
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1
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Section
1.
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Certain
Definitions
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(a)
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ADR
Register
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1
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(b)
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ADRs;
Direct Registration ADRs
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1
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(c)
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ADS
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1
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(d)
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Beneficial
Owner
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1
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(e)
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Custodian
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1
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(f)
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Deliver,
execute, issue et al.
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1
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(g)
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Delivery
Order
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1
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(h)
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Deposited
Securities
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1
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(i)
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Direct
Registration System
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1
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(j)
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Holder
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1
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(k)
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Pre-Release
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1
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(l)
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Pre-Released
ADR
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1
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(m)
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Securities
Act of 1933
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1
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(n)
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Securities
Exchange Act of 1934
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1
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(o)
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Shares
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1
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(p)
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Venezuela
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2
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(q)
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Withdrawal
Order
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1
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Section
2.
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ADRs
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2
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Section
3.
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Deposit
of Shares
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2
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Section
4.
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Issue
of ADRs
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2
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Section
5.
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Distributions
on Deposited Securities
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3
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Section
6.
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Withdrawal
of Deposited Securities
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3
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Section
7.
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Substitution
of ADRs
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4
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Section
8.
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Cancellation
and Destruction of ADRs
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4
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Section
9.
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The
Custodian
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4
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Section
10.
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Co-Registrars
and Co-Transfer Agents
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4
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Section
11.
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Lists
of Holders.
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4
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Section
12.
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Depositary's
Agents
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5
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Section
13.
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Successor
Depositary
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5
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Section
14.
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Reports
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5
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Section
15.
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Additional
Shares
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5
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Section
16.
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Indemnification
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5
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Section
17.
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Notices
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6
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Section
18.
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Miscellaneous
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6
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Section
19.
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Consent
to Jurisdiction
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6
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Section
20.
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Amendment
and Restatement of Old Deposit Agreement
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6
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TESTIMONIUM
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7
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SIGNATURES
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7
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Page
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EXHIBIT
A
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FORM
OF FACE OF CLASS B SHARE ADR
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A-1
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Introductory
Paragraph
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A-1
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(1)
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Issuance
of ADRs
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A-2
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(2)
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Withdrawal
of Deposited Securities
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A-2
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(3)
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Transfers
of ADRs
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A-2
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(4)
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Certain
Limitations
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A-3
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(5)
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Taxes
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A-4
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(6)
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Disclosure
of Interests
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A-4
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(7)
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Charges
of Depositary
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A-4
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(8)
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Available
Information
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A-5
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(9)
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Execution
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A-6
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Signature
of Depositary
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A-6
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Address
of Depositary's Office
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A-6
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FORM
OF REVERSE OF ADR
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A-7
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(10)
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Distributions
on Deposited Securities
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A-7
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(11)
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Record
Dates
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A-8
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(12)
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Voting
of Deposited Securities
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A-8
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(13)
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Changes
Affecting Deposited Securities
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A-8
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(14)
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Exoneration
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A-8
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(15)
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Resignation
and Removal of Depositary; the Custodian
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A-9
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(16)
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Amendment
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A-9
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(17)
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Termination
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A-10
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(18)
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Appointment
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A-10
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i
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Page
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EXHIBIT
B
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FORM
OF FACE OF CLASS A SHARE ADR
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B-1
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Introductory
Paragraph
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B-1
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(1)
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Issuance
of ADRs
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B-2
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(2)
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Withdrawal
of Deposited Securities
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B-2
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(3)
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Transfers
of ADRs
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B-2
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(4)
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Certain
Limitations
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B-3
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(5)
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Taxes
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B-4
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(6)
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Disclosure
of Interests
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B-4
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(7)
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Charges
of Depositary
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B-4
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(8)
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Available
Information
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B-5
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(9)
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Execution
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B-6
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Signature
of Depositary
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B-6
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Address
of Depositary's Office
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B-6
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FORM
OF REVERSE OF ADR
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B-7
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(10)
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Distributions
on Deposited Securities
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B-7
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(11)
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Record
Dates
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B-8
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(12)
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Voting
of Deposited Securities
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B-8
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(13)
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Changes
Affecting Deposited Securities
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B-8
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(14)
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Exoneration
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B-8
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(15)
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Resignation
and Removal of Depositary; the Custodian
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B-9
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(16)
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Amendment
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B-9
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(17)
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Termination
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B-10
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(18)
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Appointment
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B-10
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ii
DEPOSIT
AGREEMENT dated as of August 1, 1997 as amended and restated as of December
,
2006 (as so amended and restated, the "Deposit Agreement") among MERCANTIL
SERVICIOS FINANCIEROS, C.A. and its successors (the "Company"), JPMORGAN CHASE
BANK, N.A., as depositary hereunder (the "Depositary"), and all Holders and
Beneficial Owners from time to time of American Depositary Receipts issued
hereunder ("ADRs") evidencing American Depositary Shares ("ADSs") representing
either deposited Class B Shares or deposited Class A Shares (each described
below). The Company hereby appoints the Depositary as depositary for the
Deposited Securities and hereby authorizes and directs the Depositary to act
in
accordance with the terms set forth in this Deposit Agreement. All capitalized
terms used herein have the meanings ascribed to them in Section 1 or elsewhere
in this Deposit Agreement.
WHEREAS,
the Company and the Depositary entered into a deposit agreement dated as of
August 1, 1997 (the "Prior Deposit Agreement") to provide for the deposit of
Class B Shares of the Company with the Depositary or with the Custodian as
agent
of the Depositary for the purposes set forth in such Prior Deposit Agreement,
for the creation of American depositary shares representing the Class B Shares
so deposited and for the execution and delivery of American depositary receipts
("Old ADRs") evidencing those American depositary shares;
WHEREAS,
the Company and the Depositary desire to amend certain terms of the Prior
Deposit Agreement in accordance with paragraph (16) of the form of ADR
representing Class B Share ADSs attached to that agreement and to reflect such
amendments pursuant to the terms and conditions set forth in this Deposit
Agreement; and
1.
Certain
Definitions.
(a) "ADR
Register"
shall
mean the register maintained by the Depositary at a designated transfer office
(the "Transfer Office") 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. An ADR Register shall be
maintained for each of the Series A Share ADSs and Series B Share ADSs. The
term
ADR Register includes the Direct Registration System.
(b) "ADRs"
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, subject to the other
provisions hereof, be substantially in the form of Exhibit A, in the case of
Class B Share ADSs, and Exhibit B, in the case of Class A Share ADSs, annexed
hereto (each being the "form
of ADR"
and
collectively being the "forms
of ADRs").
The
term "Direct
Registration ADR"
means
an ADR, the ownership of which is recorded on the Direct Registration System.
References to "ADRs" shall include certificated ADRs and Direct Registration
ADRs, unless the context otherwise requires. The forms of ADRs are hereby
incorporated herein and made a part hereof; the provisions of each form of
ADR
shall be binding upon the parties hereto.
(c) "Class
B
Share ADSs" shall be those ADSs representing Class B Shares and "Class A Share
ADSs" shall be those ADSs representing Class A Shares. Subject to paragraph
(13)
of each form of ADR, each "Class
B Share ADS"
evidenced by an ADR represents the right to receive four Class B Shares and
a
pro rata share in any other Deposited Securities and each "Class
A Share ADS"
evidenced by an ADR represents the right to receive four Class A Shares and
a
pro rata share in any other Deposited Securities. Unless the context requires
otherwise, the term βADSβ shall mean the Class B Share ADSs and the Class A
Share ADSs.
(d) "Beneficial
Owner"
means a
person with a beneficial interest in an ADS.
(e) "Custodian"means
the agent or agents of the Depositary (singly or collectively, as the context
requires) and any additional or substitute Custodian appointed pursuant to
Section 9. Banco Mercantil C.A., S.A.C.A. shall serve as the initial Custodian
hereunder.
(f)
The
terms
"deliver",
"execute",
"issue",
"register",
"surrender",
"transfer"
or
"cancel",
when
used with respect to (i) Direct Registration ADRs, shall refer to an entry
or
entries or an electronic transfer or transfers in the Direct Registration
System, and (ii) ADRs in physical certificated form, shall refer to the
physical
delivery, execution, issuance, registration, surrender, transfer or cancellation
of certificates representing the ADRs.
(g) "Delivery
Order"
is
defined in Section 3.
(h) "Deposited
Securities"
as of
any time means (i) in the case of Class A Share ADSs, all Class A Shares at
such
time deposited under this Deposit Agreement and any and all other Class A
Shares, securities, property and cash at such time held by the Depositary or
the
Custodian in respect or in lieu of such deposited Class A Shares and other
Class
A Shares, securities, property and cash, and (ii) in the case of Class B Share
ADSs, all Class B Shares at such time deposited under this Deposit Agreement
and
any and all other Class B Shares, securities, property and cash at such time
held by the Depositary or the Custodian in respect or in lieu of such deposited
Class B Shares and other Class B Shares, securities, property and
cash.
2
(i)
"Direct
Registration System"
means
the system for the uncertificated registration of ownership of securities
established by The Depository Trust Company ("DTC") 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 DTC which provides for automated
transfer of ownership between DTC and the Depositary.
(j) "Holder"
means
the person or persons in whose name an ADR is registered on the ADR
Register.
(k)
"Pre-release"
has the
meaning set forth in paragraph (1) of each form of ADR.
(l)
"Pre-released
ADR"
has the
meaning set forth in paragraph (1) of each form of ADR.
(m) "Securities
Act of 1933"
means
the United States Securities Act of 1933, as from time to time
amended.
(n) "Securities
Exchange Act of 1934"
means
the United States Securities Exchange Act of 1934, as from time to time
amended.
(o) "Shares"
represented by the Class B Share ADSs evidenced by the form of ADR set forth
in
Exhibit A hereto shall mean the class B common shares of the Company (the βClass
B Sharesβ), and shall include the rights to receive such Class B Shares
specified in paragraph (1) of such form of ADR and βSharesβ represented by the
Class A Share ADSs evidenced by the form of ADR set forth in Exhibit B hereto
shall mean the class A common shares of the Company (the βClass A Sharesβ), and
shall include the right to receive such Class A Shares specified in paragraph
1
of such form of ADR. Unless the context otherwise requires, references to Shares
shall mean the Class B Shares and Class A Shares.
(p) "Venezuela"
means
the Republic of Venezuela.
(q) "Withdrawal
Order"
is
defined in Section 6.
2.
ADRs.
(a)
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 request of the Company
typewritten and photocopied on plain or safety paper, and shall be substantially
in the form set forth in the forms of ADRs, 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.
3
(b)
Direct
Registration ADRs.
Notwithstanding anything in this Deposit Agreement or in the forms of ADRs
to
the contrary, ADSs shall be evidenced by Direct Registration ADRs, unless
certificated ADRs are specifically requested by the Holder.
(c)
Holders shall be bound by the terms and conditions of this Deposit Agreement
and
of the applicable form of ADR or forms of ADRs, regardless of whether their
ADRs
are Direct Registration ADRs or certificated ADRs.
3.
Deposit
of Shares.
Subject
to paragraph (1) of each form of ADR, in connection with the deposit of Shares
hereunder, the Depositary or the Custodian may require the following in form
satisfactory to it: (a) a written order directing the Depositary to issue to,
or
upon the written order of, the person or persons designated in such order an
ADR
or ADRs evidencing the number of ADSs representing such deposited Shares (a
"Delivery Order"); (b) proper endorsements or duly executed instruments of
transfer in respect of such deposited Shares; (c) instruments assigning to
the
Depositary or its nominee any distribution on or in respect of such deposited
Shares or indemnity therefor; and (d) proxies entitling the Depositary to vote
such deposited Shares. As soon as practicable after the Custodian receives
Deposited Securities pursuant to any such deposit or pursuant to paragraph
(10)
or (13) of the applicable form of ADR, the Custodian shall present such
Deposited Securities for registration of transfer into the name of the
Depositary or its nominee, to the extent such registration is practicable,
at
the cost and expense of the person making such deposit (or for whose benefit
such deposit is made) and shall obtain evidence satisfactory to it of such
registration. Deposited Securities shall be held by the Custodian for the
account and to the order of the Depositary at such place or places and in such
manner as the Depositary shall determine. Deposited Securities may be delivered
by the Custodian to any person only under the circumstances expressly
contemplated in this Deposit Agreement. To the extent that the provisions of
or
governing the Shares make delivery of certificates therefor impracticable,
Shares may be deposited hereunder by such delivery thereof as the Depositary
or
the Custodian may reasonably accept, including, without limitation, by causing
them to be credited to an account maintained by the Custodian for such purpose
with the Company or an accredited intermediary, such as a bank, acting as a
registrar for the Shares, together with delivery of the documents, payments
and
Delivery Order referred to herein to the Custodian or the Depositary.
4.
Issue
of ADRs.
After
any such deposit of Shares, the Custodian shall notify the Depositary of such
deposit and of the information contained in any related Delivery Order by
letter, first class airmail postage prepaid, or, at the request, risk and
expense of the person making the deposit, by cable, telex or facsimile
transmission. After receiving such notice from the Custodian, the Depositary,
subject to this Deposit Agreement, shall properly issue at the Transfer Office,
to or upon the order of any person named in such notice, an ADR or ADRs
registered as requested and evidencing the aggregate Class A Share ADSs or
Class
B Share ADSs, as the case may be, to which such person is entitled. ADRs may
be
issued by the Depositary only under circumstances contemplated in this Deposit
Agreement.
4
5.
Distributions
on Deposited Securities; Conversion of Foreign Currency.
(a) To
the extent that the Depositary determines in its good faith discretion,
after consultation with the Company to the extent practicable, that any
distribution pursuant to paragraph (10) of any form of ADR is not practicable
with respect to any Holder, the Depositary may make such distribution as it
so
deems practicable, including the distribution of foreign currency, securities
or
property (or appropriate documents evidencing the right to receive foreign
currency, securities or property) or the retention thereof as Deposited
Securities with respect to such Holder's ADRs (without liability for interest
thereon or the investment thereof).
(b)
Upon
receipt by the Depositary or the Custodian of any foreign currency in connection
with the Deposited Securities, if at the time of its receipt such foreign
currency can in the reasonable judgment of the Depositary be converted on a
reasonable basis into U.S. dollars and the resulting U.S. dollars transferred
to
the United States for distribution to Holders entitled thereto, the Depositary
shall as promptly as practicable convert or cause to be converted such foreign
currency into U.S. dollars by sale or in any other manner that it may determine,
and shall transfer the resulting U.S. dollars (net of its charges and expenses
in effecting such conversion) to the United States and shall distribute such
U.S. dollars to the Holders entitled thereto in accordance with Paragraph (10)
of the applicable form of ADR. If such conversion or distribution can be
effected only with the approval or license of any government or agency thereof,
the Depositary shall have discretion to file such application for approval
or
license as it may deem desirable. If the Depositary determines in its reasonable
judgment that such foreign currency is not convertible, in whole or in part,
on
a reasonable basis into U.S. dollars transferable to the United States, or
if
any approval or license which is required for such conversion is denied or
in
the opinion of the Depositary, after consultation with the Company to the extent
practicable, is not obtainable or is not obtained within a reasonable period
or
at a reasonable cost, the Depositary may distribute all or part of the foreign
currency (or an appropriate document evidencing the right to receive such
foreign currency) to, or in its discretion may hold such foreign currency
uninvested and without liability for interest thereon for the respective
accounts of, the Holders entitled thereto. All fees and expenses of any such
conversion shall be deducted from the proceeds thereof.
6.
Withdrawal
of Deposited Securities.
In
connection with any surrender of an ADR for withdrawal of the Deposited
Securities represented by the ADSs evidenced thereby, the Depositary may require
proper endorsement in blank of such ADR (or duly executed instruments of
transfer thereof in blank) and the Holder's written order directing the
Depositary to cause the Deposited Securities represented by the ADSs evidenced
by such ADR to be withdrawn and delivered to, or upon the written order of,
any
person designated in such order (a "Withdrawal Order"). Directions from the
Depositary to the Custodian to deliver Deposited Securities shall be given
by
letter, first class airmail postage prepaid, or, at the request, risk and
expense of the Holder, by cable, telex or facsimile transmission. Delivery
of
Deposited Securities may be made by the delivery of certificates (which, if
required by law shall be properly endorsed or accompanied by properly executed
instruments of transfer or, if such certificates may be registered, registered
in the name of such Holder or as ordered by such Holder in any Withdrawal Order)
or by such other means as the Depositary may deem practicable, including,
without limitation, by transfer of record ownership thereof to an account
designated in the Withdrawal Order maintained either by the Company or an
accredited intermediary, such as a bank, acting as a registrar for the Deposited
Securities.
5
7.
Substitution
of ADRs.
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 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.
8.
Cancellation
and Destruction of ADRs.
All
ADRs surrendered to the Depositary shall be cancelled by the Depositary. The
Depositary is authorized to destroy ADRs in certificated form so cancelled
in
accordance with its customary practices. The Depositary shall maintain records
of all ADRs surrendered and Deposited Securities withdrawn under Paragraph
(2)
of each form of ADR, substitute ADRs delivered, and cancelled or destroyed
ADRs
under this Section 8, in keeping with the procedures ordinarily followed by
stock transfer agents located in The City of New York or as required by
applicable law, rule or regulation.
9.
The
Custodian.
The
Depositary shall use its reasonable efforts under the circumstances to ensure
that at all times there is a Custodian hereunder. Other than the initial
Custodian appointed hereunder, the Depositary shall be responsible for the
compliance by each Custodian with the provisions hereof applicable thereto.
Any
Custodian in acting hereunder shall be subject to the directions of the
Depositary and shall be responsible solely to it. The Depositary may from time
to time, after consultation with the Company if practicable, appoint one or
more
agents to act for it as Custodian hereunder. Each Custodian so appointed (other
than JPMorgan Chase Bank, N.A.) shall give written notice to the Company and
the
Depositary accepting such appointment and agreeing to be bound by the applicable
terms hereof. Any Custodian may resign from its duties hereunder by at least
30
days written notice to the Depositary. The Depositary may, after consultation
with the Company if practicable, discharge any Custodian at any time upon notice
to the Custodian being discharged and subject to the provisions of any agreement
between such Custodian and the Depositary. Any Custodian ceasing to act
hereunder as Custodian shall deliver, upon the instruction of the Depositary,
all Deposited Securities held by it to a Custodian continuing to
act.
10.
Co-Registrars
and Co-Transfer Agents.
The
Depositary may appoint and remove (i) co-registrars to register Class A Share
ADSs and/or Class B Share ADSs and transfers, combinations and split-ups of
ADRs
and to countersign ADRs in accordance with the terms of any such appointment
and
(ii) co-transfer agents for the purpose of effecting transfers, combinations
and
split-ups of ADRs at designated transfer offices in addition to the Transfer
Office on behalf of the Depositary. Each co-registrar or co-transfer agent
(other than JPMorgan Chase Bank, N.A.) shall give notice in writing to the
Company and the Depositary accepting such appointment and agreeing to be bound
by the applicable terms of this Deposit Agreement.
11.
Lists
of Holders.
The
Company shall have the right to inspect transfer records of the Depositary
and
its agents and the ADR Registers, take copies thereof and require the Depositary
and its agents to supply copies of such portions of such records as the Company
may request. The Depositary or its agent shall furnish to the Company promptly
upon the written request of the Company, a list of the names, addresses and
holdings of ADSs by all Holders as of a date within seven days of the
Depositary's receipt of such request.
6
12.
Depositary's
Agents.
The
Depositary may perform its obligations under this Deposit Agreement through
any
agent appointed by it, provided that the Depositary shall notify the Company
of
such appointment and shall remain responsible for the performance of such
obligations as if no agent were appointed.
13.
Successor
Depositary.
The
Depositary may at any time resign as Depositary hereunder by 60 days prior
written notice of its election so to do delivered to the Company. The Depositary
may at any time be removed by the Company by 60 days prior written notice of
such removal. Notwithstanding anything to the contrary contained herein, in
case
at any time the Depositary acting hereunder shall resign or be removed, it
shall
continue to act as Depositary for the purpose of terminating this Deposit
Agreement pursuant to paragraph (17) of each form of ADR. Any bank or trust
company into or with which the Depositary may be merged or consolidated, or
to
which the Depositary shall transfer substantially all its American depositary
receipt business, shall be the successor of the Depositary without the execution
or filing of any document or any further act.
14.
Reports.
On or
before the first date on which the Company makes any communication generally
available to holders of Deposited Securities or publicly files or submits any
communication to any securities regulatory authority or stock exchange, the
Company shall transmit to the Depositary a copy thereof in English or with
an
English translation or summary to the extent required under Rule 12g3-2(b)
promulgated under the Securities Exchange Act of 1934. The Company has delivered
to the Depositary and the Custodian, a copy of all provisions of or governing
the Shares and any other Deposited Securities issued by the Company or any
affiliate of the Company and, promptly upon any change thereto, the Company
shall deliver to the Depositary and the Custodian a copy (in English or with
an
English translation) of such provisions as so changed. The Depositary and its
agents may rely upon the Company's delivery thereof for all purposes of this
Deposit Agreement.
15.
Additional
Shares.
Neither
the Company nor any company controlling, controlled by or under common control
with the Company shall issue additional Shares, rights to subscribe for Shares,
securities convertible into or exchangeable for Shares or rights to subscribe
for any such securities or shall deposit any Shares under this Deposit
Agreement, except under circumstances complying in all respects with the
Securities Act of 1933. The Depositary will use reasonable efforts to comply
with written instructions of the Company not to accept for deposit hereunder
any
Shares 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 securities laws in the United
States.
16.
Indemnification.
The
Company shall indemnify, defend and save harmless each of the Depositary and
its
agents against any loss, liability or expense (including reasonable fees and
expenses of counsel) which may arise out of acts performed or omitted, in
connection with the provisions of this Deposit Agreement and of the ADRs, as
the
same may be amended, modified or supplemented from time to time in accordance
herewith (i) by either the Depositary or its agents or their respective
directors, employees, agents and affiliates, except, subject to the penultimate
paragraph of this Section 16, for any liability or expense directly arising
out
of the negligence or bad faith of the Depositary or its agents appointed
hereunder (other than the initial Custodian), or (ii) by the Company or any
of
its directors, employees, agents or affiliates.
7
The
indemnities set forth in the preceding paragraph shall apply to any liability
or
expense which may arise out of any misstatement or alleged misstatement or
omission or alleged omission in any registration statement, proxy statement,
prospectus (or placement memorandum), or preliminary prospectus (or preliminary
placement memorandum) relating to the offer or sale of ADSs, except to the
extent any such liability or expense arises out of (i) information relating
to
the Depositary or its agents (other than the Company), as applicable, furnished
in writing by the Depositary and not changed or altered by the Company expressly
for use in any of the foregoing documents or (ii) if such information is
provided, the failure to state a material fact necessary to make the information
provided not misleading.
Except
as
provided in the next succeeding paragraph, the Depositary shall indemnify,
defend and save harmless the Company against any loss, liability or expense
(including reasonable fees and expenses of counsel) incurred by the Company
in
respect of this Deposit Agreement to the extent such loss, liability or expense
is due to the negligence or bad faith of the Depositary or its agents appointed
hereunder (other than the initial Custodian).
Any
person seeking indemnification hereunder (an "indemnified
person")
shall
notify the person from whom it is seeking indemnification (the "indemnifying
person")
of the
commencement of any indemnifiable action or claim promptly after such
indemnified person becomes aware of such commencement (provided that the failure
to make such notification shall not affect such indemnified person's rights
otherwise than under this Section 16 and shall only affect its rights hereunder
to the limited extent that such failure is prejudicial) and shall consult in
good faith with the indemnifying person as to the conduct of the defense of
such
action or claim, which shall be reasonable in the circumstances. No indemnified
person shall compromise or settle any indemnifiable action or claim without
the
prior written consent of the indemnifying person (which consent shall not be
unreasonably withheld or delayed).
Notwithstanding
any other provision of this Deposit Agreement or the forms of ADRs to the
contrary, neither the Company nor the Depositary, nor any of their agents,
shall
be liable to the other for any indirect, special, punitive or consequential
damages (collectively "Special Damages") except (i) to the extent such Special
Damages arise from the gross negligence or willful misconduct of the party
from
whom indemnification is sought or (ii) to the extent Special Damages arise
from
or out of a claim brought by a third party (including, without limitation,
Holders) against the Depositary or its agents, except to the extent such Special
Damages arise out of the gross negligence or willful misconduct of the party
seeking indemnification hereunder
The
obligations set forth in this Section 16 shall survive the termination of this
Deposit Agreement and the succession or substitution of any indemnified
person.
17.
Notices.
Notice
to any Holder shall be deemed given when first mailed, first class postage
prepaid, to the address of such Holder on any ADR Register or received by such
Holder. Notice to the Depositary or the Company shall be deemed given when
first
received by it at the address or facsimile transmission number set forth in
(a)
or (b), respectively, or at such other address or facsimile transmission number
as either may specify to the other by written notice:
8
|
(a)
|
JPMorgan
Chase Bank, N.A.
|
|
|
Four
Xxx Xxxx Xxxxx
|
||
|
Xxx
Xxxx, Xxx Xxxx 00000
|
||
|
Attention:
ADR Administration
|
||
|
Fax:
(000) 000-0000
|
||
|
(b)
|
||
|
Xx.
Xxxxxx Xxxxx Xx. 0
|
||
|
Xxxx.
Xxxxxxxxx, Piso 35
|
||
|
Caracas
1011, Republic of Venezuela
|
||
|
Attention:
Manager of Shareholders' Division
|
||
|
Fax:
000 000 0000
|
18.
Miscellaneous.
This
Deposit Agreement is for the exclusive benefit of the Company, the Depositary,
the Holders, and their respective successors hereunder, and shall not give
any
legal or equitable right, remedy or claim whatsoever to any other person. The
Holders and owners of ADRs from time to time shall be parties to this Deposit
Agreement and shall be bound by all of the provisions hereof. If any such
provision is invalid, illegal or unenforceable in any respect, the remaining
provisions shall in no way be affected thereby. This Deposit Agreement may
be
executed in any number of counterparts, each of which shall be deemed an
original and all of which shall constitute one instrument. The Depositary agrees
to respond promptly to such reasonable inquiries or requests for information
(which information is currently made available on a regular basis by the
Depositary to its depositary receipt clientele) as the Company may make from
time to time with respect to the depositary receipt facility created hereby.
19.
Consent
to Jurisdiction.
The
Company irrevocably waives any objection which it may now or hereafter have
to
the laying of venue of, and any agrees that, any legal suit, action or
proceeding against the Company brought by the Depositary or any Holder, arising
out of or based upon this Deposit Agreement or the transactions contemplated
hereby, may be instituted in any state or federal court in the Borough of
Manhattan in New York, New York, and irrevocably submits to the non-exclusive
jurisdiction of such courts in any such suit, action or proceeding. The Company
also irrevocably agrees that any legal suit, action or proceeding against the
Depositary brought by the Company, arising out of or based upon this Deposit
Agreement or the transactions contemplated hereby, may only be instituted in
a
state or federal court in the Borough of Manhattan in New York, New York. The
Company has appointed Banco Mercantil New York Representative Office, 00 Xxxx
00xx
Xxxxxx,
Xxx Xxxx, XX 00000, as its authorized agent (the "Authorized Agent") upon which
process may be served in any such action arising out of or based on this Deposit
Agreement or the transactions contemplated hereby which may be instituted in
any
state or federal court in the Borough of Manhattan in New York, New York by
the
Depositary or any Holder, and waives any other requirements of or objections
to
personal jurisdiction with respect thereto. The Company represents and warrants
that the Authorized Agent has agreed to act as said agent for service of
process, and the Company agrees to take any and all action, including the filing
of any and all documents and instruments, that may be necessary to continue
such
appointment in full force and effect as aforesaid. Service of process upon
the
Authorized Agent and written notice of such service to the Company shall be
deemed, in every respect, effective service of process upon the Company. If,
for
any reason, the Authorized Agent named above or its successor shall no longer
serve as agent of the Company to receive service of process in New York, the
Company shall promptly appoint a successor acceptable to the Depositary, so
as
to serve and will promptly advise the Depositary thereof. In the event the
Company fails to continue such designation and appointment in full force and
effect, the Company hereby waives personal service of process upon it and
consents that any such service of process may be made by certified or registered
mail, return receipt requested, directed to the Company at its address last
specified for notices hereunder, and service so made shall be deemed completed
five days after the same shall have been couriered by a recognized overnight
delivery service. Notwithstanding the foregoing, any action based on this
Agreement may be instituted by the Depositary or any Holder in any competent
court in the Republic of Venezuela.
9
To
the
extent that the Company or any of its properties, assets or revenues may have
or
may hereafter be entitled to, or have attributed to it, any right of immunity,
on the grounds of sovereignty or otherwise, from any legal action, suit or
proceeding, from the giving of any relief in any respect thereof, from setoff
or
counterclaim, from the jurisdiction of any court, from service of process,
from
attachment upon or prior to judgment, from attachment in aid of execution or
judgment, or from execution of judgment, or other legal process or proceeding
for the giving of any relief or for the enforcement of any judgment, in any
jurisdiction in which proceedings may at any time be commenced, with respect
to
its obligations, liabilities or other matters under or arising out of or in
connection with the Shares or Deposited Securities, the ADSs, the ADRs or this
Agreement, the Company, to the fullest extent permitted by law, hereby
irrevocably and unconditionally waives, and agrees not to plead or claim, any
such immunity and consents to such relief and enforcement.
20. Amendment
and Restatement of Prior Deposit Agreement.
The
Deposit
Agreement
amends and restates the Prior Deposit Agreement in its entirety to consist
exclusively of the Deposit Agreement, and each Old ADR is hereby deemed amended
and restated to substantially conform to the form of ADR set forth in Exhibit
A
annexed hereto, except that, to the extent any portion of such amendment and
restatement would prejudice any substantial existing right of Holders and
Beneficial Owners of Old ADRs, such portion shall not become effective as to
such Holders or Beneficial Owners with respect to such Old ADRs until 30 days
after Holders shall have received notice thereof, such notice to be conclusively
deemed given upon the mailing to such Holders of notice of such amendment and
restatement which notice contains a provision whereby such Holders can receive
a
copy of the form of ADR.
10
IN
WITNESS WHEREOF, MERCANTIL SERVICIOS FINANCIEROS, C.A. and JPMORGAN CHASE BANK,
N.A. have duly executed this Deposit Agreement as of the day and year first
above set forth and all holders of ADRs shall become parties hereto upon
acceptance by them of ADRs issued in accordance with the terms
hereof.
|
By:
|
||
|
Name:
|
||
|
Title:
|
||
|
JPMORGAN
CHASE BANK, N.A.
|
||
|
By:
|
||
|
Name:
|
||
|
Title:
Vice President
|
||
11
EXHIBIT
A
ANNEXED
TO AND INCORPORATED IN
DEPOSIT
AGREEMENT
[FORM
OF
FACE OF ADR EVIDENCING CLASS B SHARE ADSs]
|
____
|
No.
of ADSs:
|
|
Number
|
|
|
__________
|
|
|
Each
ADS represents
|
|
|
Four
Shares
|
|
|
CUSIP:
|
THE
SHARES REPRESENTED HEREBY HAVE LIMITED VOTING RIGHTS. SEE
PARAGRAPH
(12) HEREOF.
AMERICAN
DEPOSITARY RECEIPT
evidencing
AMERICAN
DEPOSITARY SHARES
representing
SERIES
B
COMMON SHARES
of
(Incorporated
under the laws of The Republic of Venezuela)
JPMORGAN
CHASE BANK, N.A., a national banking association organized under the laws of
the
United States of America, 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 four
series B common shares (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 Mercantil Servicios
Financieros, C.A., a corporation organized under the laws of the Republic of
Venezuela (the "Company"), deposited under the Deposit Agreement dated as of
August 1, 1997 as amended and restated as of December , 2006 (as amended from
time to time, the "Deposit Agreement") among the Company, the Depositary and
all
Holders and Beneficial Owners from time to time of American Depositary Receipts
issued thereunder ("ADRs"), each of whom, by accepting an ADR, agrees to become
a party thereto and to be bound by all of the terms and conditions thereof
and
hereof. 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. The terms and conditions of the Deposit
Agreement are hereby incorporated by reference.
A-1
(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) unless requested in writing
by the Company to cease doing so at least two business days in advance of the
proposed deposit, 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
such other collateral as the Depositary deems appropriate held by the Depositary
for the benefit of Holders (but such collateral shall not constitute "Deposited
Securities"), (ii) each recipient of Pre-released ADRs represents and agrees
in
writing with the Depositary that such recipient or its customer (a) beneficially
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 but in no event more than five days after demand
therefor, and (iii) all Pre-released ADRs evidence not more than 20% of all
ADSs
(excluding those evidenced by Pre-released ADRs). 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.
Holders
of ADRs will be entitled to withdraw the Deposited Securities at any time
subject only to (i) temporary delays caused by closing the transfer books of
the
Depositary or the Company or the deposit of Shares in connection with voting
at
a shareholders' meeting, or the payment of dividends, (ii) the payment of fees,
taxes and similar charges, and (iii) compliance with any laws or governmental
regulations relating to the ADRs or the withdrawal of Deposited Securities.
Subject to paragraphs (4) and (5), 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, or to the extent in dematerialized
form from, 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.
A-2
(3)
Transfers
of ADRs.
The ADR
Register shall, 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.
The
Depositary shall also maintain facilities for the delivery and receipt of ADRs.
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 and neither the Depositary nor the Company will have
any
obligation or be subject to any liability under the Deposit Agreement to any
holder of an ADR, unless such holder is the Holder thereof. 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
aggregate number of ADSs surrendered for split-up or combination, 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
first 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 of any signatory
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. 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 first 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 if the Company
reasonably deems such closure necessary by reason of applicable law, rule or
regulation.
A-3
(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 first 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, if appropriate, shall reduce the number of ADSs evidenced
hereby to reflect any such sales of Shares and shall distribute the net proceeds
of any such sale or the balance of any such property after deduction of such
tax
or other governmental charge to the Holders entitled thereto. 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. Each
Holder of an ADR or an interest therein agrees to indemnify the Depositary,
the
Company, the Custodian and any of their respective directors, employees, agents
and affiliates against, and hold each of them harmless from, any claims by
any
governmental authority with respect to taxes, additions to tax, penalties or
interest arising out of any refund of taxes, reduced rate of withholding at
source or other tax benefit obtained.
(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 comply with any reasonable Company
instructions in respect thereof. The Company reserves the right to instruct
Holders to deliver their ADSs for cancellation and withdrawal of the Deposited
Securities so as to permit the Company to deal directly with the Holder thereof
as a holder of Shares and Holders agree to comply with such instructions. The
Depositary agrees to cooperate with the Company in its efforts to inform Holders
of the Company's exercise of its rights under this paragraph and agrees to
consult with, and provide reasonable assistance without risk, liability or
expense on the part of the Depositary, to the Company on the manner or manners
in which it may enforce such rights with respect to any Holder.
A-4
(7)
Charges
of Depositary.
The
Depositary may collect from (i) each person to whom ADSs are
issued, including, without limitation, issuances against deposits of
Shares, issuances in respect of Share Distributions, Rights and Other
Distributions (as such terms are defined in paragraph (10)), issuances
pursuant to a stock dividend or stock split declared by the Company, or
issuances pursuant to a merger, exchange of securities or any other
transaction or event affecting the ADSs or the Deposited Securities,
and (ii) each person surrendering ADSs for withdrawal of Deposited
Securities or whose ADSs are cancelled or reduced for any other reason, up
to
U.S.$5.00 for each 100 ADSs (or portion thereof) issued, delivered, reduced,
cancelled or surrendered (as the case may be). 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 ADSs, to whom ADSs 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 ADSs or the Deposited Securities or a
distribution of ADSs pursuant to paragraph (10)), whichever is applicable (i)
a
fee of U.S.$0.02 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 the primary stock exchange upon which the ADSs are listed, a fee of
U.S.$1.50 per ADR or ADRs for transfers made pursuant to paragraph (3) hereof,
(iii) a fee for the distribution or sale 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, (iv)
a
fee of U.S.$0.02 per ADS (or portion thereof) per year for the services
performed by the Depositary in administering the ADRs (which fee shall be
assessed against Holders as of the record date or dates set by the Depositary
not more than once each calendar year and shall be payable at the sole
discretion of the Depositary by billing such Holders or by deducting such charge
from one or more cash dividends or other cash distributions), 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. 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 or 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) any other charge payable by any of the Depositary,
any of the Depositaryβs agents, including, without limitation, the custodian, or
the agents of the Depositaryβs agents in connection with the servicing of the
Shares or other Deposited Securities (which charge shall be assessed against
Holders as of the record date or dates set by the Depositary and shall be
payable at the sole discretion of the Depositary by billing such Holders or
by
deducting such charge from one or more cash dividends or other cash
distributions). Such charges may at any time and from time to time be changed
by
agreement between the Company and the Depositary.
A-5
(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. At the written request of the Company, the Depositary will
distribute copies of such communications (or English translations or summaries
thereof) to Holders when furnished by the Company. The Company furnishes the
United States Securities and Exchange Commission (the "Commission") with certain
public reports and documents required by foreign law or otherwise under Rule
12g3-2(b) under the Securities Exchange Act of 1934. Such reports and documents
may be inspected and copied at the public reference facilities maintained by
the
Commission located at the date of the Deposit Agreement at 000 X Xxxxxx, XX,
Xxxxxxxxxx, XX 00000.
(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.
A-6
[FORM
OF
REVERSE OF ADR]
(10)
Distributions
on Deposited Securities.
Subject
to paragraphs (4) and (5) and any restrictions imposed by Venezuelan law, rule,
regulation or applicable permit, to the extent practicable, the Depositary
will
promptly distribute 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. If the Depositary
determines that any foreign currency received by it cannot be converted on
a
reasonable basis and transferred to the United States, the Depositary may
distribute the foreign currency received by it or, at its sole discretion,
hold
such foreign currency, uninvested and without liability for interest thereon.
(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 good faith 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,
after
consultation with the Company if practicable, lawful, equitable and practicable,
or (ii) to the extent the Depositary deems, after consultation with the Company
if practicable, distribution of such securities or property not to be lawful,
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. Fractional cents will be withheld without
liability and dealt with by the Depositary in accordance with its then current
practices. Notwithstanding anything herein to the contrary, the Company shall
have no obligation to either (i) register any ADSs, Shares, Rights or other
securities described in this Paragraph (10) under the Securities Act of 1933
or
(ii) take other actions to permit the distribution of such ADSs, Shares, Rights
or other securities in accordance with applicable U.S. securities
laws.
A-7
(11)
Record
Dates.
The
Depositary may, after consultation with the Company if practicable, fix a record
date (which, to the extent applicable, shall be as near as practicable to any
corresponding record date set by the Company with respect to the Shares) for
the
determination of the Holders who shall be responsible for the fee assessed
by
the Depositary for administration of the ADR program and for any expenses
provided for in paragraph (7) hereof as well as 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 or obligated.
(12)
Voting
of Deposited Securities.
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, upon the written request of the Company, shall
distribute 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, subject to any applicable provisions
of Venezuelan law, 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. 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. Class B Shares have the same rights as Class A Shares,
except that (i) a Class B Share has one-tenth of the voting power of a Class
A
Share and (ii) Class B Shares can only be voted for the appointment of statutory
auditors and their alternates and for the approval of financial statements
presented by the Board of Directors.
To
the
extent such instructions are not so received by the Depositary from any Holder,
the Depositary shall deem such Holder to have so instructed the Depositary
to
give a discretionary proxy to a person designated by the Company and the
Depositary shall endeavor insofar as practicable and permitted under the
provisions of or governing Deposited Securities to give a discretionary proxy
to
a person designated by the Company to vote the Deposited Securities represented
by the ADSs evidenced by such Holder's ADRs as to which such instructions are
so
given, provided
that no
such instruction shall be deemed given and no discretionary proxy shall be
given
with respect to any matter as to which the Company informs the Depositary (and
the Company agrees to provide such information promptly in writing) or the
Depositary reasonably believes (in the case of (y) or (z) below) that (x) the
Company does not wish such proxy given, (y) substantial opposition exists or
(z)
such matter materially affects the rights of holders of Shares.
A-8
Notwithstanding
anything to the contrary contained herein, prior to providing any such deemed
instruction with respect to any vote, the Depositary may require the Company
to
provide it with, and if so requested the Depositary shall have received, a
legal
opinion of counsel to the Company satisfactory to the Depositary, in form and
substance satisfactory to the Depositary, to the effect that (i) the granting
of
such discretionary proxy does not subject the Depositary to any reporting
obligations in The Republic of Venezuela, (ii) the granting of such proxy will
not result in a violation of Venezuelan law, rule, regulation or permit, (iii)
the voting arrangement and proxy as contemplated herein will be given effect
under Venezuelan law, rule and regulation, (iv) the Depositary will not be
deemed to be authorized to exercise any discretion when voting in accordance
with the terms of this paragraph (12) under Venezuelan law, rule or regulation
and, (v) the Depositary will not be subject to any liability under Venezuelan
law, rule or regulation for losses arising from the exercise of the voting
arrangements set forth in this paragraph (12).
There
is
no guarantee that Holders generally or any Holder in particular will receive
the
notice described above with sufficient time to enable such Holder to return
any
voting instructions to the Depositary in a timely manner.
(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, irrespective of whether such Deposited
Securities are surrendered or otherwise cancelled by operation of law, rule,
regulation or otherwise, 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.
A-9
(14)
Exoneration.
The
Depositary, the Company, their agents and each of them shall: (a) incur no
liability (i) if any present or future law, rule or regulation of the United
States, the Republic of Venezuela or any other country, or of any governmental
or regulatory authority or any securities exchange or market or automated
quotation system, the provisions of or governing any Deposited Securities,
any
present or future provision of the Company's charter, any act of God, war,
terrorism 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
them (including, without limitation, voting pursuant to paragraph (12) hereof),
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 in good faith to be
competent to give such advice or information. Neither the Depositary nor its
agents shall be responsible for any limitations, qualifications or restrictions
imposed upon any of them, the Shares, the ADRs or under the Deposit Agreement
as
a result of the entering into of the Deposit Agreement or any terms hereof
or
thereof. The Depositary, the Company and the respective agents of each of them
acting hereunder 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. Notwithstanding anything to the contrary set forth
in
the Deposit Agreement or an ADR, the Depositary and its agents may fully respond
to any and all demands or requests for information maintained by or on its
behalf in connection with the Deposit Agreement, any Holder or Holders, any
ADR
or ADRs or otherwise related hereto to the extent such information is requested
or required by or pursuant to any lawful authority, including without limitation
laws, rules, regulations, administrative or judicial process, banking,
securities or other regulators. The Company has agreed to indemnify the
Depositary and its agents under certain circumstances and the Depositary has
agreed to indemnify the Company under certain circumstances. Neither the Company
nor the Depositary nor any of their respective agents shall be liable to Holders
or beneficial owners of interests in ADSs for any indirect, special, punitive
or
consequential damages. 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 60 days prior written notice of its
election to do so delivered to the Company, or be removed as Depositary by
the
Company by 60 days prior written notice of such removal delivered to the
Depositary. The Depositary may appoint substitute or additional Custodians
and
the term "Custodian"
refers
to each Custodian or all Custodians as the context requires.
(16)
Amendment.
Subject
to the first sentence of paragraph (2), the ADRs and the Deposit Agreement
may
be amended by the Company and the Depositary without the consent of the Holders
in any respect, 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 or regulatory
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 laws, rules
or
regulations. 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.
A-10
(17)
Termination.
The
Depositary may, and shall at the written direction of the Company, terminate
the
Deposit Agreement (or the ADSs representing Class B Shares portion thereof)
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.
(18)
Appointment.
Each
Holder and each person holding an interest in ADSs, upon acceptance of any
ADSs
(or any interest therein) issued in accordance with the terms and conditions
of
the Deposit Agreement shall be deemed for all purposes to (a) be a party to
and
bound by the terms of the Deposit Agreement and the applicable ADR(s), and
(b)
appoint the Depositary its attorney-in-fact, with full power to delegate, to
act
on its behalf and to take any and all actions contemplated in the Deposit
Agreement and the applicable ADR(s), to adopt any and all procedures necessary
to comply with applicable law and to take such action as the Depositary in
its
sole discretion may deem necessary or appropriate to carry out the purposes
of
the Deposit Agreement and the applicable ADR(s), the taking of such actions
to
be the conclusive determinant of the necessity and appropriateness
thereof.
A-11
EXHIBIT
B
ANNEXED
TO AND INCORPORATED IN
DEPOSIT
AGREEMENT
[FORM
OF
FACE OF ADR EVIDENCING CLASS A SHARE ADSs]
[FORM
OF
FACE OF ADR]
|
____
|
No.
of ADSs:
|
|
Number
|
|
|
__________
|
|
|
Each
ADS represents
|
|
|
Four
Shares
|
|
|
CUSIP:
|
AMERICAN
DEPOSITARY RECEIPT
evidencing
AMERICAN
DEPOSITARY SHARES
representing
SERIES
A
COMMON SHARES
of
(Incorporated
under the laws of The Republic of Venezuela)
JPMORGAN
CHASE BANK, N.A., a national banking association organized under the laws of
the
United States of America, 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 four
series A common shares (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 Mercantil Servicios
Financieros, C.A., a corporation organized under the laws of the Republic of
Venezuela (the "Company"), deposited under the Deposit Agreement dated as of
August 1, 1997 as amended and restated as of [DATE] , 2006 (as amended from
time
to time, the "Deposit Agreement") among the Company, the Depositary and all
Holders and Beneficial Owners from time to time of American Depositary Receipts
issued thereunder ("ADRs"), each of whom, by accepting an ADR, agrees to become
a party thereto and to be bound by all of the terms and conditions thereof
and
hereof. 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. The terms and conditions of the Deposit
Agreement are hereby incorporated by reference.
B-1
(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) unless requested in writing
by the Company to cease doing so at least two business days in advance of the
proposed deposit, 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
such other collateral as the Depositary deems appropriate held by the Depositary
for the benefit of Holders (but such collateral shall not constitute "Deposited
Securities"), (ii) each recipient of Pre-released ADRs represents and agrees
in
writing with the Depositary that such recipient or its customer (a) beneficially
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 but in no event more than five days after demand
therefor, and (iii) all Pre-released ADRs evidence not more than 20% of all
ADSs
(excluding those evidenced by Pre-released ADRs). 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.
Holders
of ADRs will be entitled to withdraw the Deposited Securities at any time
subject only to (i) temporary delays caused by closing the transfer books of
the
Depositary or the Company or the deposit of Shares in connection with voting
at
a shareholders' meeting, or the payment of dividends, (ii) the payment of fees,
taxes and similar charges, and (iii) compliance with any laws or governmental
regulations relating to the ADRs or the withdrawal of Deposited Securities.
Subject to paragraphs (4) and (5), 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, or to the extent in dematerialized
form from, 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.
B-2
(3)
Transfers
of ADRs.
The ADR
Register shall, 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.
The
Depositary shall also maintain 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 and neither the Depositary nor the Company will have
any
obligation or be subject to any liability under the Deposit Agreement to any
holder of an ADR, unless such holder is the Holder thereof. 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
aggregate number of ADSs surrendered for split-up or combination, 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
first 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 of any signatory
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. 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 first 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 if the Company
reasonably deems such closure necessary by reason of applicable law, rule or
regulation.
B-3
(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 first 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, if appropriate, shall reduce the number of ADSs evidenced
hereby to reflect any such sales of Shares and shall distribute the net proceeds
of any such sale or the balance of any such property after deduction of such
tax
or other governmental charge to the Holders entitled thereto. 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. Each
Holder of an ADR or an interest therein agrees to indemnify the Depositary,
the
Company, the Custodian and any of their respective directors, employees, agents
and affiliates against, and hold each of them harmless from, any claims by
any
governmental authority with respect to taxes, additions to tax, penalties or
interest arising out of any refund of taxes, reduced rate of withholding at
source or other tax benefit obtained.
(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 comply with any reasonable Company
instructions in respect thereof. The Company reserves the right to instruct
Holders to deliver their ADSs for cancellation and withdrawal of the Deposited
Securities so as to permit the Company to deal directly with the Holder thereof
as a holder of Shares and Holders agree to comply with such instructions. The
Depositary agrees to cooperate with the Company in its efforts to inform Holders
of the Company's exercise of its rights under this paragraph and agrees to
consult with, and provide reasonable assistance without risk, liability or
expense on the part of the Depositary, to the Company on the manner or manners
in which it may enforce such rights with respect to any Holder.
B-4
(7)
Charges
of Depositary.
The
Depositary may collect from (i) each person to whom ADSs are
issued, including, without limitation, issuances against deposits of
Shares, issuances in respect of Share Distributions, Rights and Other
Distributions (as such terms are defined in paragraph (10)), issuances
pursuant to a stock dividend or stock split declared by the Company, or
issuances pursuant to a merger, exchange of securities or any other
transaction or event affecting the ADSs or the Deposited Securities,
and (ii) each person surrendering ADSs for withdrawal of Deposited
Securities or whose ADSs are cancelled or reduced for any other reason,
U.S.$5.00 for each 100 ADSs (or portion thereof) issued, delivered, reduced,
cancelled or surrendered (as the case may be). 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 ADSs, to whom ADSs 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 ADSs or the Deposited Securities or a
distribution of ADSs pursuant to paragraph (10)), whichever is applicable (i)
a
fee of U.S.$0.02 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 the primary stock exchange upon which the ADSs are listed, a fee of
U.S.$1.50 per ADR or ADRs for transfers made pursuant to paragraph (3) hereof,
(iii) a fee for the distribution or sale 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, (iv)
a
fee of U.S.$0.02 per ADS (or portion thereof) per year for the services
performed by the Depositary in administering the ADRs (which fee shall be
assessed against Holders as of the record date or dates set by the Depositary
not more than once each calendar year and shall be payable at the sole
discretion of the Depositary by billing such Holders or by deducting such charge
from one or more cash dividends or other cash distributions), 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. 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 or 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) any other charge payable by any of the Depositary,
any of the Depositaryβs agents, including, without limitation, the custodian, or
the agents of the Depositaryβs agents in connection with the servicing of the
Shares or other Deposited Securities (which charge shall be assessed against
Holders as of the record date or dates set by the Depositary and shall be
payable at the sole discretion of the Depositary by billing such Holders or
by
deducting such charge from one or more cash dividends or other cash
distributions). Such charges may at any time and from time to time be changed
by
agreement between the Company and the Depositary.
B-5
(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. At the written request of the Company, the Depositary will
distribute copies of such communications (or English translations or summaries
thereof) to Holders when furnished by the Company. The Company furnishes the
United States Securities and Exchange Commission (the "Commission") with certain
public reports and documents required by foreign law or otherwise under Rule
12g3-2(b) under the Securities Exchange Act of 1934. Such reports and documents
may be inspected and copied at the public reference facilities maintained by
the
Commission located at the date of the Deposit Agreement at 000 X Xxxxxx, XX,
Xxxxxxxxxx, XX 00000.
(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.
B-6
[FORM
OF
REVERSE OF ADR]
(10)
Distributions
on Deposited Securities.
Subject
to paragraphs (4) and (5) and any restrictions imposed by Venezuelan law, rule,
regulation or applicable permit, to the extent practicable, the Depositary
will
promptly distribute 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. If the Depositary
determines that any foreign currency received by it cannot be converted on
a
reasonable basis and transferred to the United States, the Depositary may
distribute the foreign currency received by it or, at its sole discretion,
hold
such foreign currency, uninvested and without liability for interest thereon.
(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 good faith 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,
after
consultation with the Company if practicable, lawful, equitable and practicable,
or (ii) to the extent the Depositary deems, after consultation with the Company
if practicable, distribution of such securities or property not to be lawful,
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. Fractional cents will be withheld without
liability and dealt with by the Depositary in accordance with its then current
practices. Notwithstanding anything herein to the contrary, the Company shall
have no obligation to either (i) register any ADSs, Shares, Rights or other
securities described in this Paragraph (10) under the Securities Act of 1933
or
(ii) take other actions to permit the distribution of such ADSs, Shares, Rights
or other securities in accordance with applicable U.S. securities
laws.
B-7
(11)
Record
Dates.
The
Depositary may, after consultation with the Company if practicable, fix a record
date (which, to the extent applicable, shall be as near as practicable to any
corresponding record date set by the Company with respect to the Shares) for
the
determination of the Holders who shall be responsible for the fee assessed
by
the Depositary for administration of the ADR program and for any expenses
provided for in paragraph (7) hereof as well as 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 or obligated.
(12)
Voting
of Deposited Securities.
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, upon the written request of the Company, shall
distribute 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, subject to any applicable provisions
of Venezuelan law, 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. 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. Class B Shares have the same rights as Class A Shares,
except that (i) a Class B Share has one-tenth of the voting power of a Class
A
Share and (ii) Class B Shares can only be voted for the appointment of statutory
auditors and their alternates and for the approval of financial statements
presented by the Board of Directors.
To
the
extent such instructions are not so received by the Depositary from any Holder,
the Depositary shall deem such Holder to have so instructed the Depositary
to
give a discretionary proxy to a person designated by the Company and the
Depositary shall endeavor insofar as practicable and permitted under the
provisions of or governing Deposited Securities to give a discretionary proxy
to
a person designated by the Company to vote the Deposited Securities represented
by the ADSs evidenced by such Holder's ADRs as to which such instructions are
so
given, provided
that no
such instruction shall be deemed given and no discretionary proxy shall be
given
with respect to any matter as to which the Company informs the Depositary (and
the Company agrees to provide such information promptly in writing) or the
Depositary reasonably believes (in the case of (y) or (z) below) that (x) the
Company does not wish such proxy given, (y) substantial opposition exists or
(z)
such matter materially affects the rights of holders of Shares.
B-8
Notwithstanding
anything to the contrary contained herein, prior to providing any such deemed
instruction with respect to any vote, the Depositary may require the Company
to
provide it with, and if so requested the Depositary shall have received, a
legal
opinion of counsel to the Company satisfactory to the Depositary, in form and
substance satisfactory to the Depositary, to the effect that (i) the granting
of
such discretionary proxy does not subject the Depositary to any reporting
obligations in The Republic of Venezuela, (ii) the granting of such proxy will
not result in a violation of Venezuelan law, rule, regulation or permit, (iii)
the voting arrangement and proxy as contemplated herein will be given effect
under Venezuelan law, rule and regulation, (iv) the Depositary will not be
deemed to be authorized to exercise any discretion when voting in accordance
with the terms of this paragraph (12) under Venezuelan law, rule or regulation
and, (v) the Depositary will not be subject to any liability under Venezuelan
law, rule or regulation for losses arising from the exercise of the voting
arrangements set forth in this paragraph (12).
There
is
no guarantee that Holders generally or any Holder in particular will receive
the
notice described above with sufficient time to enable such Holder to return
any
voting instructions to the Depositary in a timely manner.
(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, irrespective of whether such Deposited
Securities are surrendered or otherwise cancelled by operation of law, rule,
regulation or otherwise, 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.
(14)
Exoneration.
The
Depositary, the Company, their agents and each of them shall: (a) incur no
liability (i) if any present or future law, rule or regulation of the United
States, the Republic of Venezuela or any other country, or of any governmental
or regulatory authority or any securities exchange or market or automated
quotation system, the provisions of or governing any Deposited Securities,
any
present or future provision of the Company's charter, any act of God, war,
terrorism 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
them (including, without limitation, voting pursuant to paragraph (12) hereof),
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 in good faith to be
competent to give such advice or information. Neither the Depositary nor its
agents shall be responsible for any limitations, qualifications or restrictions
imposed upon any of them, the Shares, the ADRs or under the Deposit Agreement
as
a result of the entering into of the Deposit Agreement or any terms hereof
or
thereof. The Depositary, the Company and the respective agents of each of them
acting hereunder 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. Notwithstanding anything to the contrary set forth
in
the Deposit Agreement or an ADR, the Depositary and its agents may fully respond
to any and all demands or requests for information maintained by or on its
behalf in connection with the Deposit Agreement, any Holder or Holders, any
ADR
or ADRs or otherwise related hereto to the extent such information is requested
or required by or pursuant to any lawful authority, including without limitation
laws, rules, regulations, administrative or judicial process, banking,
securities or other regulators. The Company has agreed to indemnify the
Depositary and its agents under certain circumstances and the Depositary has
agreed to indemnify the Company under certain circumstances. Neither the Company
nor the Depositary nor any of their respective agents shall be liable to Holders
or beneficial owners of interests in ADSs for any indirect, special, punitive
or
consequential damages. No disclaimer of liability under the Securities Act
of
1933 is intended by any provision hereof.
B-9
(15)
Resignation
and Removal of Depositary; the Custodian.
The
Depositary may resign as Depositary by 60 days prior written notice of its
election to do so delivered to the Company, or be removed as Depositary by
the
Company by 60 days prior written notice of such removal delivered to the
Depositary. The Depositary may appoint substitute or additional Custodians
and
the term "Custodian"
refers
to each Custodian or all Custodians as the context requires.
(16)
Amendment.
Subject
to the first sentence of paragraph (2), the ADRs and the Deposit Agreement
may
be amended by the Company and the Depositary without the consent of the Holders
in any respect, 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 or regulatory
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 laws, rules
or
regulations. 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.
B-10
(17)
Termination.
The
Depositary may, and shall at the written direction of the Company, terminate
the
Deposit Agreement (or the ADSs representing Class A Shares portion thereof)
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.
(18)
Appointment.
Each
Holder and each person holding an interest in ADSs, upon acceptance of any ADSs
(or any interest therein) issued in accordance with the terms and conditions
of
the Deposit Agreement shall be deemed for all purposes to (a) be a party to
and
bound by the terms of the Deposit Agreement and the applicable ADR(s), and
(b)
appoint the Depositary its attorney-in-fact, with full power to delegate, to
act
on its behalf and to take any and all actions contemplated in the Deposit
Agreement and the applicable ADR(s), to adopt any and all procedures necessary
to comply with applicable law and to take such action as the Depositary in
its
sole discretion may deem necessary or appropriate to carry out the purposes
of
the Deposit Agreement and the applicable ADR(s), the taking of such actions
to
be the conclusive determinant of the necessity and appropriateness
thereof.
B-11