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LETTER OF INSTRUCTIONS
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LETTER OF INSTRUCTIONS NO. 276
TO
: The Chairman and Members
National Development Company
GENTLEMEN:
In order to facilitate the disposition of private lands owned by Caltex (Philippines) Inc. and affected by the termination of the Laurel-Langley Agreement, you are hereby directed to undertake the following measures:
1.
Immediately execute the appropriate deed of
donation between Caltex (Philippines) Inc. and NDC, whereby the former
donates to the latter its private lands. Properties shall be donated at
fair market value as evidenced by the amount established in 1974 as a
basis for real estate tax payment.
2. Execute
with Caltex the simultaneous exchange of
private landholdings for shares of stock such that both shall acquire
control over the Batangas Land Company (BLC), a realty corporation
organized by employees of Caltex.
The simultaneous exchange shall
be made strictly conforming to the
following guidelines:
a.
The authorized capital stock of BLC must first be
increased to P35 million more or less;
b. NDC shall
acquire at least 60 percent of the
authorized capital stock and convey in payment therefor its
landholdings acquired under PD No. 680 and lands acquired from Caltex
donation.
c. Caltex
shall acquire the remaining portion of the
authorized capital stock and convey, in payment therefor, parcels of
land in equal value to the total shares of stock bought, provided that
such parcels of land be likewise appraised at their fair market value
as evidenced by the amount established in 1974 as a basis for real
estate tax payment.
d. BLC shall
then be a corporation 60% owned and
controlled by NDC and shall have at least three members of its Board of
Directors elected from among the Board of Directors of NDC.
3. Arrange and finalize the execution of the lease contract between BLC and Caltex for the latter's lease of all its former private lands transferred to NDC by donation and under PD No. 680.
The lease contract shall strictly conform to the following guidelines:
a.
Lease period shall be for 25 years renewable for
another 25 years.
b. Rent shall
not be less than 1½ per cent of
the donated value during the first 25-year period. Annual rental for
the total fifty year period shall not be less than 2 ½ per cent
of the donated value.
In addition, the rent shall
include the amount representing the real
estate taxes due from BLC on lands leased to Caltex, who shall then
continue to bear the real estate tax liability.
c. A
revaluation of the lands shall be made prior to
the renewal date of the first 25-year period and annual rentals then
shall be paid against any resultant higher revaluation of the land.
Revaluation shall not exceed 25% above the original valuation.
Ownership of all improvements on the lands remains with Caltex Philippines even after fifty year-lease period provided ownership does not conflict with existing pertinent law.
For immediate compliance.
May 9, 1975
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