WHEREAS,
Agrix Marketing, Inc. and its subsidiary and affiliate corporations had
induced the public to invest funds upon the promise of excessive rates
of interest under schemes the Securities and Exchange Commission has
declared to be illegal devices; chanroblesvirtualawlibrary
WHEREAS, Agrix Marketing, Inc. and its subsidiary and affiliate
corporations have defaulted on the payment of the promised yields
including the principal, as a result of the deterioration of their
financial position;chanroblesvirtualawlibrary
WHEREAS, pursuant to its power under PD 902-A, the Securities and
Exchange Commissions found that these high interest-yielding investment
contracts were illegal devices or schemes amounting to
misrepresentations which are detrimental to the interest of the public
particularly the small investors;chanroblesvirtualawlibrary
WHEREAS, after study and evaluation of the existing assets and
liabilities, earnings and operations of the Agrix Group of
corporations, it has been determined that the best way to salvage and
protect the interests of its investors and creditors is to consolidate
the assets and liabilities of the Agrix Group of Companies into a
single corporation which will then be rehabilitated with the assistance
of government;chanroblesvirtualawlibrary
WHEREAS, under Letter of Instructions No. 1021, the National
Development Company has been deputized to formulate and adopt a
rehabilitation program for the Agrix Complex corporations to best
protect the interests of its investors and creditors;chanroblesvirtualawlibrary
WHEREAS, in view of the magnitude of investments and the number of
small investors involved, there is a need to act expeditiously in order
to protect the investing public and creditors and insure stability of
the economy. chanroblesvirtualawlibrary
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Republic of
the Philippines, by virtue of the powers vested in me by the
Constitution, do hereby order:cralaw:red
Section 1. Rehabilitation Program. — The
Rehabilitation program of Agrix Marketing, Inc. and its subsidiary and
affiliate corporations as formulated by the National Development
Company is hereby approved, under terms and conditions set forth below.
Section 2. Dissolution of the Agrix Group of
Companies and Organization of New Agrix, Inc. — In line with the
rehabilitation program, the corporations comprising the Agrix Group of
Companies are to be dissolved and their assets and liabilities are to
be transferred to New Agrix, Inc. which is hereby authorized to be
organized as a private stock corporation. The Securities and Exchange
Commission is hereby instructed to permit the incorporation of New
Agrix, Inc. with an authorized capital stock of Two Hundred Million
Pesos (P200,000,000.00) divided into 200 million common shares with a
par value of One (1) Peso per share.
The provisions of the Corporation Code regarding watered stocks
notwithstanding, the paid-up capital of New Agrix, Inc. will consist of
the sum of the valid claims of investors and shareholders in the Agrix
Group of Companies. In the determination of valid claims only the
principal amount, without interest and dividends, of investors and
shareholders' in the Agrix Group of Companies, excluding those against
whom criminal charges have been or will be filed, will be
considered. chanroblesvirtualawlibrary
Section 3. Procedure for Issuance of Common Shares of
the New Agrix, Inc. — New Agrix, Inc. shall issue shares of stock
equivalent to the principal amount of the valid claims of all Agrix
investors and shareholders, other than those excluded in Sec. 2, upon
submission by such investors and shareholders of original copies of
proof of their investment. A Claims Committee, consisting of a
representative from the National Development Company, the Securities
and Exchange Commission and the Ministry of Justice, is hereby
constituted to establish the rules and regulations for determining the
validity of claims.
Section 4. Settlements of Monetary Obligations of
Dissolved Corporations. — All monetary obligations, whether secured or
unsecured, of the dissolved corporations, duly submitted and verified
shall be assumed by the New Agrix, Inc. but only in respect of the
principal value thereof, except for secured creditors. Payment thereof
shall be subject to the following terms and conditions:cralaw:red
(i) Secured obligations shall bear interest at the
rate of twelve per cent (12%) per annum on outstanding balances and
shall be payable in equal annual installments over a 5-year period,
commencing one year from date hereof. All mortgages and other liens
presently attaching to any of the assets of the dissolved corporations
are hereby extinguished.
(ii) Unsecured obligations shall not bear interest
and shall be payable in equal annual installments over a 10-year
period, commencing one year from date hereof.
(iii) All accrued interests, penalties or charges as
of date hereof pertaining to the obligations, whether secured or
unsecured, shall not be recognized.
Section 5. Interest-Free Rehabilitation Loan. — To
assist in the attainment of the obligations of the rehabilitation
program, the National Development Company shall extend an interest-free
loan to the New Agrix, Inc. in an amount not to exceed Ten Million
Pesos (P10,000,000.00), unless authorized by the President of the
Philippines.
Section 6. Exemption from Taxes. — As a further
assistance from the national government and in order to accelerate the
rehabilitation program, New Agrix Inc. shall be exempted from all taxes
under the National Internal Revenue Code, as amended, for a period of
five years from date hereof.
Section 7. Management of the New Agrix, Inc. — In
order to protect its interests and that of the investors, National
Development Company shall manage the New Agrix, Inc. until such time as
the interest-free loan has been fully paid. In carrying out this
management responsibility, the National Development Company shall
submit periodic and regular reports to the Board of Directors of New
Agrix, Inc. which shall be duly organized in accordance with corporate
rules, to represent the shareholders of New Agrix, Inc. Upon full
payment of the National Development Company loan, the Board of New
Agrix, Inc. will appoint its own management.
Section 8. Exemption from Liability. — The National
Development Company, including their officers and employees, or any
person or entity acting in their behalf, shall not be held liable for
any act or omission in connection with the implementation of this
Decree.
Section 9. Actions or Proceedings Involving the
Dissolved Corporations and/or their Assets. — All monetary claims
against the dissolved corporations which are presently pending, or
which may hereafter be filed, with the court or with any adjudicatory
body, shall be dismissed. In addition, in all legal proceedings of
whatever nature wherein a claim or charge is made against any of the
assets of the dissolved corporations, no order shall be issued which
may in any way interfere with the full possession and ownership of said
assets by the New Agrix, Inc. chanroblesvirtualawlibrary
Section 10. Assistance of Government Agencies and
Offices. — The Securities and Exchange Commission and such other
government agencies or offices as may be involved in the implementation
of this Decree shall extend all assistance to facilitate the
achievement of the objective of this Decree.
Section 11. Effectivity. — This Decree shall take
effect 90 days from date hereof or upon certification by the Ministry
of Justice that the filing of criminal charges against Agrix principals
has been completed, whichever is earlier.
Done in the City of Manila,
this 21st day of August, in the year of Our Lord, Nineteen Hundred and
Eighty.
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