DOJ Opinion No. 020, s. 1983

DOJ OPINION NO. 020 , s. 1983 January 27, 1983 To: The Sumitomo Bank, Limited, 3-2, Marunouchi 1-chome Chiyoda-ku, Tokyo For it self as Agent for the Banks parties to the Loan Agreement referred to below, and to such Banks Re: National Power Corporation Japanese Yen 2,000,000 Loan Facility Guaranteed by the Republic of the Philippines Gentlemen : As the Minister of Justice of the Republic of the Philippines (the "Republic"), I have been requested to give this opinion to you in connection with the Guarantee (the "Guarantee") dated August 28, 1982 made by the Republic of the Philippines (in such capacity, the "Guarantor") under which the Guarantor has agreed to guarantee the obligations of National Power Corporation under a Loan Agreement dated August 28, 1982 made between (1) National Power Corporation (the "Borrower") (2) The Sumitomo Bank, Limited, as Lead Manager and the several banks and financial institutions the respective names and offices of which are set forth in the Schedule to the Agreement under the headings "Lead Manager" and "Managers" (together the "Managers") (3) the several banks and financial institutions the respective names and offices of which are set forth in the Schedule to the Agreement (together the "Banks") and (4) The Sumitomo Bank, Limited, as agent for the Banks (in such capacity, the "Agent") under which the Banks have agreed to make available to the Borrower a loan facility not exceeding the maximum principal amount of Y2,000,000,000. Words and expressions defined in the Agreement shall bear the same meaning in this letter. After examining all documents, including an executed copy of the Guarantee and making all inquiries which I consider necessary and having regard to the laws of the Republic which I consider relevant, I am of the opinion that: 1. The Guarantee as executed and delivered constitutes the legal, valid and binding obligations of the Guarantor enforceable in accordance with its terms. 2. The obligations of the Guarantor under the Guarantee constitute the direct, uncondition, unsecured and general obligations of the Guarantor and will rank and do rank at least pari passu with all other outstanding unsecured and unsubordinated External indebtedness from time to time issued, created or assumed by the Guarantor, whether now or in the future. prcd 3. The Guarantor has not created any mortgage, charge, lien, pledge or other encumbrance over any, of its property, assets or rights to receive income by way of specific security for any of its External Indebtedness now existing, other than (a) liens, charges, encumbrances or other security interests created on property at the time of purchase thereof to secure payment of the purchase price of such property of (b) liens arising in the ordinary course of banking transactions securing a debt maturing not more than one year after its date. 4. Any permission, order, consent, license, approval or authorization of any government authority, bureau or agency in the Republic required in connection with the execution, delivery or performance, legality, validity or enforceability of the Guarantee has been obtained. 5. It is not necessary or advisable under the laws of the Republic to file, register or otherwise record the Guarantee or any other document relating thereto in any public office or elsewhere in order to ensure the validity, effectiveness or enforceability of the Guarantee. 6. There are no stamp taxes, levies, registration taxes, duties or similar charges now due, or which under the present laws of the Republic could in the future become due, in connection with the execution or delivery of the Guarantee or on any payment to be made by the Guarantor pursuant thereto (except such incomes taxes which the Guarantor is required to withhold under the laws of the Republic), in connection with the enforcement of the Agreement or the Guarantee or on the admissibility into evidence of the Guarantee. 7. The obligation imposed on the Guarantor by paragraph 8 of the Guarantee to pay to the agent for each Bank such additional amounts as are mentioned therein in the event that by law any payments to be made by the Guarantor are subject to any Taxes is not in breach of any law of the Republic and is a valid, binding and enforceable obligation of the Guarantor. 8. The execution, delivery and performance of the Guarantee by the Guarantor will not in any respect exceed any power granted to it by or violate or conflict with or result in any breach of any provision of any law, statute, decree, rule or regulation or any order of any governmental authority, agency or court of the Republic and, furthermore, none of the terms of the Guarantee or of any procedure contemplated in the Guarantee is in contravention of or is alleged (to the best of my knowledge) by any applicable authority or body void, voidable, prohibited of unenforceable under the laws of the Republic. 9. The Guarantor is not in breach of any agreement relating to External Indebtedness or other debt obligations in excess of the equivalent of $10 million (at current rates or exchange) to which it is a party or by which it may be bound and no litigation, arbitration, or administrative proceedings are presently current or pending or, to the best of my knowledge, threatened, which breach, litigation, arbitration or administrative proceedings, as the case may be, would be material in the context of the Guarantee or might impair the Guarantor's ability to perform its obligation under the Guarantee. 10. The waiver of immunity and consent to enforcement of judgment by the Guarantor contained in paragraph 13 of the Guarantee is not in breach of any law of the Republic and are valid, binding and irrevocable. The submission by the Guarantor to the non-exclusive jurisdiction of the High Court of Justice of England, the New York State and Federal courts sitting in New York City and the Tokyo District Court pursuant to paragraph 12 of the Guarantee, is effective to permit such courts to exercise jurisdiction over the Guarantor in any action or proceedings brought in such courts, provided that each such court is entitled under the laws or regulations applicable to it to exercise such jurisdiction. prcd 11. The execution and delivery of the Guarantee by the Guarantor constitutes the private and commercial act of the Guarantor. 12. The express choice by the Guarantor that the governing law of the Guarantee be Japanese law under paragraph 12 of the Guarantee is valid under the private international law of the Republic and Japanese law would accordingly be applied by the courts of the Republic if the Guarantee or any claim made under it comes under their jurisdiction. A court of the Republic would, however, also refer to the laws, decrees, and administrative regulations of the Republic upon the capacity and the authority of the Guarantor to provide guarantees and the Guarantee in particular. A judgment of the Courts of England or any New York State or Federal Court sitting in New York City or the Tokyo District Court rendered in an action brought in accordance with applicable law to enforce the obligations of the Guarantor under the Guarantee would be enforceable in the Republic against the Guarantor, except for want of jurisdiction, lack of notice, collusion or fraud and clear mistake of fact or law. 13. The qualification by the Agent or the Banks for admission to do business under the laws of the Republic of the Philippines or any political sub-division thereof does not constitute a condition to, and the failure to so qualify does not affect, the exercise by the Agent or the Banks (solely by reason of the execution and delivery of this Guarantee) of any right, privilege or remedy afforded to the Agent or the Banks in, under or in connection with the Guarantee or the enforcement of any such right, privilege or remedy. The performance by the Agent or the Banks of any action required or permitted under the Guarantee will not violate any law or regulation of the Republic of the Philippines or any political sub-division thereof or result in any tax liability upon or other unfavorable consequences for the agent or any of the Banks pursuant to the laws of the Republic of the Philippines or any political sub-division or taxing authority thereof. 14. The Guarantor is a member in good standing of the International Monetary Fund ("IMF") and is fully eligible to utilize its Special Drawing Right, and the General Resources Account of the IMF in accordance with the Articles of Agreement of the IMF. You and the Banks may continue to rely on this opinion on the first Drawdown, unless otherwise notified. llcd Very truly yours, (SGD.) RICARDO C. PUNO Minister of Justice