Unassociated Document
Rule
424(b)(3) 333-137108
THE
RIGHT OF HOLDERS HEREOF TO DIRECT THE VOTING OF SHARES MAY BE RESTRICTED AS
DESCRIBED IN PARAGRAPHS (6) AND (13)
BELOW.
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No. of ADSs: |
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Each ADSs represent |
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One Share |
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CUSIP: |
AMERICAN
DEPOSITARY RECEIPT
evidencing
AMERICAN
DEPOSITARY SHARES
representing
SHARES,
NOMINAL VALUE 0.5 SWISS FRANCS PER SHARE
of
NOVARTIS
AG
(Incorporated
under the
laws
of
Switzerland)
JPMORGAN
CHASE BANK, N.A., a national banking association organized under the laws of
the
United States, as depositary hereunder (the "Depositary"), hereby certifies
that
is the
registered owner (a "Holder") of American
Depositary Shares ("ADSs"), each (subject to paragraph (14)) representing one
Share, nominal value 0.5 Swiss Francs per Share (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 Novartis AG,
a
corporation organized under the laws of Switzerland, and its successors(the
"Company"), deposited at the Geneva office of the Custodian (subject to
paragraph (16), the "Custodian"), under the Amended and Restated Deposit
Agreement dated as of May 11, 2000 to the Deposit Agreement dated as of December
17, 1996 (as so amended and restated and as further amended from time to time,
the "Deposit Agreement") among the Company, the Depositary and all Holders
from
time to time of American Depositary Receipts issued thereunder ("ADRs"), each
of
whom by accepting an ADR becomes a party thereto. The Deposit Agreement and
this
ADR (which includes the provisions set forth on the reverse hereof) shall be
governed by and construed in accordance with the laws of the State of New
York.
(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 at all times fully collateralized (marked to market daily)
with cash or U.S. government securities held by the Depositary for the benefit
of Holders and beneficial owners of ADSs (but such collateral shall not
constitute "Deposited Securities"), (ii) each recipient of Pre-released ADRs
agrees in writing with the Depositary that such recipient (a) owns such Shares,
(b) assigns all beneficial right, title and interest therein to the Depositary,
(c) holds such Shares for the account of the Depositary in its capacity as
such
and for the benefit of the Holders and beneficial owners and (d) will deliver
such Shares to the Custodian as soon as practicable and promptly upon demand
therefor and (iii) all Pre-released ADRs evidence not more than 20% of all
ADSs
(excluding those evidenced by Pre-released ADRs), except that the Depositary
may, with the prior consent of the Company, change such limit. The Depositary
may retain for its own account any earnings on collateral for Pre-released
ADRs
and its charges for issuance thereof. At the request, risk and expense of the
person depositing Shares, the Depositary may accept deposits for forwarding
to
the Custodian and may deliver ADRs at a place other than its office. Every
person depositing Shares under the Deposit Agreement represents and warrants
that such Shares are validly issued and outstanding, fully paid, nonassessable
and free of pre-emptive rights, that the person making such deposit is duly
authorized so to do and that such Shares (A) are not "restricted securities"
as
such term is defined in Rule 144 under the Securities Act of 1933 unless at
the
time of deposit they may be freely transferred in accordance with Rule 144(k)
and may otherwise be offered and sold freely in the United States or (B) have
been registered under the Securities Act of 1933. Such representations and
warranties shall survive the deposit of Shares and issuance of ADRs. The
Depositary will not knowingly accept for deposit under the Deposit Agreement
any
Shares required to be registered under the Securities Act of 1933 and not so
registered; the Depositary may refuse to accept for such deposit any Shares
identified by the Company in order to facilitate the Company's compliance with
such Act.
(2)
Withdrawal
of Deposited Securities.
Subject
to paragraphs (4) and (5), upon surrender of (i) a certificated ADR in form
satisfactory to the Depositary at the Transfer Office or (ii) proper
instructions and documentation in the case of a Direct Registration ADR, the
Holder hereof is entitled to delivery at the Custodian's office of the Deposited
Securities at the time represented by the ADSs evidenced by this ADR. At the
request, risk and expense of the Holder hereof, the Depositary may deliver
such
Deposited Securities at such other place as may have been requested by the
Holder. Notwithstanding any other provision of the Deposit Agreement or this
ADR, the withdrawal of Deposited Securities may be restricted only for the
reasons set forth in General Instruction I.A.(1) of Form F-6 (as such
instructions may be amended from time to time) under the Securities Act of
1933.
(3)
Transfers,
Split-ups and Combinations of ADRs; Maintenance of Office and Transfer Books
by
the Depositary.
The
Depositary or its agent will keep, at a designated transfer office in the
Borough of Manhattan, The City of New York (the "Transfer Office"), (a) a
register (the "ADR Register") for the registration, registration of transfer,
combination and split-up of ADRs, and, in the case of Direct Registration ADRs,
shall include the Direct Registration System, which at all reasonable times
will
be open for inspection by Holders and the Company for the purpose of
communicating with Holders in the interest of the business of the Company or
a
matter relating to the Deposit Agreement and (b) facilities for the delivery
and
receipt of ADRs. The term ADRs includes the Direct Registration System. Title
to
this ADR (and to the Deposited Securities represented by the ADSs evidenced
hereby), when properly endorsed or accompanied by 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 and the Company, notwithstanding any notice to the contrary, may
treat the person in whose name this ADR is registered on the ADR Register as
the
absolute owner hereof for all purposes. Subject to paragraphs (4) and (5),
this
ADR is transferable on the ADR Register and may be split into other ADRs or
combined with other ADRs into one ADR, evidencing the same number of ADSs
evidenced by this ADR, by the Holder hereof or by duly authorized attorney
upon
surrender of this ADR at the Transfer Office properly endorsed or accompanied
by
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. The Depositary, subject
to
the above terms and conditions, shall, upon surrender of a certificated ADR
or
ADRs for purposes of transferring the same or effecting a split-up or
combination of the same, issue a Direct Registration ADR or, at the request
of
the Holder hereof, a new certificated ADR or ADRs, and deliver the same to
or
upon the order of the person entitled thereto without unreasonable delay. 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. At the expense of the Company, the Company shall
have the right, during normal business hours and on reasonable advance notice,
to inspect transfer and registration records of the Depositary relating to
the
ADRs and to take copies thereof, and to require the Depositary and any
co-registrars to supply copies of such portions of such records as the Company
may reasonably request.
(4)
Certain
Limitations.
Prior
to the issue, registration, registration of transfer, split-up or combination
of
any ADR, the delivery of any distribution in respect thereof, or, subject to
the
last sentence of paragraph (2), the withdrawal of any Deposited Securities,
and
from time to time in the case of clause (b)(ii) of this paragraph (4), the
Company, the Depositary or the Custodian may require: (a) payment with respect
thereto of (i) any stock transfer or other tax or other governmental charge,
(ii) any stock transfer or registration fees in effect for the registration
of
transfers of Shares or other Deposited Securities upon any applicable register
and (iii) any applicable charges as provided in paragraph (7) of this ADR;
(b)
the production of proof satisfactory to it of (i) the identity and genuineness
of any signature and (ii) such other information, including without limitation,
information as to citizenship, residence, exchange control approval, beneficial
ownership of any securities, compliance with applicable law, regulations,
provisions of or governing Deposited Securities and terms of the Deposit
Agreement and this ADR, as it may deem necessary or proper; and (c) compliance
with such regulations as the Depositary may establish consistent with the
Deposit Agreement. The issuance of ADRs, the acceptance of deposits of Shares,
the registration, registration of transfer, split-up or combination of ADRs
or,
subject to the last sentence of paragraph (2), the withdrawal of Deposited
Securities may be suspended, generally or in particular instances, when the
ADR
Register or any register for Deposited Securities is closed or when any such
action is deemed advisable by the Depositary or the Company.
(5)
Taxes.
If any
tax or other governmental charge shall become payable by or on behalf of the
Custodian or the Depositary with respect to this ADR, any Deposited Securities
represented by the ADSs evidenced hereby or any distribution thereon, such
tax
or other governmental charge shall be paid by the Holder hereof to the
Depositary. The Depositary may refuse to effect any registration, registration
of transfer, split-up or combination hereof or, subject to the last sentence
of
paragraph (2), any withdrawal of such Deposited Securities until such payment
is
made. The Depositary may also deduct from any distributions on or in respect
of
Deposited Securities, or may sell by public or private sale for the account
of
the Holder hereof any part or all of such Deposited Securities (after attempting
by reasonable means to notify the Holder hereof prior to such sale), and may
apply such deduction or the proceeds of any such sale in payment of such tax
or
other governmental charge, the Holder hereof remaining liable for any
deficiency, and shall reduce the number of ADSs evidenced hereby to reflect
any
such sales of Shares. The Depositary will forward to the Company in a timely
fashion such information from its records as the Company may reasonably request
to enable the Company to file necessary reports with governmental authorities
or
agencies, and either the Company or the Depositary may file any such reports
necessary to obtain benefits under any applicable tax treaties for Holders.
The
Depositary shall cooperate with the Company in the Company's efforts to make
and
maintain arrangements enabling Holders to receive any tax credits or other
benefits (pursuant to treaty or otherwise) relating to dividend payments on
the
ADSs, and the Depositary shall, to the extent reasonably practicable, provide
the Company with such documents as the Company may reasonably request to
maintain such arrangements. In connection with any distribution to Holders,
the
Company will remit to the appropriate governmental authority or agency all
amounts (if any) required to be withheld and owing to such authority or agency
by the Company; and the Depositary and the Custodian will remit to the
appropriate governmental authority or agency all amounts (if any) required
to be
withheld and owing to such authority or agency by the Depositary or the
Custodian. If the Depositary determines that any distribution in property other
than cash (including Shares or rights) on Deposited Securities is subject to
any
tax that the Depositary or the Custodian is obligated to withhold, the
Depositary may dispose of all or a portion of such property in such amounts
and
in such manner as the Depositary deems necessary and practicable to pay such
taxes, by public or private sale, and the Depositary shall distribute the net
proceeds of any such sale or the balance of any such property after deduction
of
such taxes to the Holders entitled thereto.
(6)
Disclosure
of Interests.
To the
extent that the provisions of or governing any Deposited Securities may require
disclosure of or impose limits on beneficial or other ownership of Deposited
Securities, other Shares and other securities or may provide for blocking
transfer, voting or other rights, Holders and all persons holding ADRs agree
to
comply with all such disclosure requirements and ownership limitations and
to
cooperate with the Depositary in the Depositary's compliance with any Company
instructions in respect thereof, and the Depositary will use reasonable efforts
to comply with such Company instructions.
Article
5
of the Company's Articles of Incorporation provides that the Board of Directors
of the Company may register nominees with the right to vote in the share
register of the Company to the extent of up to 0.5% of the registered share
capital as set forth in the commercial register. Registered Shares held by
a
nominee that exceed this limit may be registered in the share register if the
nominee discloses the names, addresses and the number of Shares of the persons
for whose account it holds 0.5% or more of the registered Share capital as
set
forth in the commercial register. A nominee who does not comply with such
disclosure requirements will be registered in the share register of the Company
without voting rights with respect to such Shares. Nominees within the meaning
of this provision of Article 5 of the Company's Articles of Incorporation are
persons who do not explicitly declare in the request for registration to hold
the Shares for their own account and with whom the Board of Directors of the
Company has entered into a corresponding agreement. The Company has agreed
to
exempt the Depositary and the Custodian and their respective nominees if any
(but no individual Holder) from this limitation in respect of Deposited
Securities held in connection with the Company's ADR program.
Subject
to the third sub-paragraph of Paragraph (13) hereof, regardless of whether
a
holder of Shares (in the form of Shares and/or ADRs or otherwise) has complied
with all disclosure requirements, the Company may in its discretion refuse
to
recognize the voting rights (and the rights connected therewith) of any Holder
of Shares in respect of Shares held, directly or indirectly, singly or in
combination or concert with other entities by agreement or otherwise, in excess
of 2% of the Company's share capital at any time entered in the Commercial
Register of the Canton of Basle City. See paragraph (13) regarding Voting of
Deposited Securities.
(7)
Charges
of Depositary.
The
Depositary may charge each person to whom ADRs are issued against deposits
of
Shares, including deposits in respect of Share Distributions, Rights and Other
Distributions (as such terms are defined in paragraph (10)), and each person
surrendering ADRs for withdrawal of Deposited Securities, up to U.S. $5.00
for
each 100 ADSs (or portion thereof) evidenced by the ADRs delivered or
surrendered. The Depositary may sell (by public or private sale) sufficient
securities and property received in respect of Share Distributions, Rights
and
Other Distributions prior to such deposit to pay such charge. The Company will
pay all other charges and expenses of the Depositary and any agent of the
Depositary (except the Custodian) pursuant to agreements from time to time
between the Company and the Depositary, except (i) stock transfer or other
taxes
and other governmental charges (which are payable by Holders or persons
depositing Shares), (ii) cable, telex and facsimile transmission and delivery
charges incurred at the request of persons depositing, or Holders delivering
Shares, ADRs or Deposited Securities (which are payable by such persons or
Holders), (iii) transfer or registration fees for the registration of transfer
of Deposited Securities on any applicable register in connection with the
deposit or withdrawal of Deposited Securities (which are payable by persons
depositing Shares or Holders withdrawing Deposited Securities; there are no
such
fees in respect of the Shares as of the date of the Deposit Agreement) and
(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). These charges
may be changed in the manner indicated in paragraph (17).
(8)
Available
Information.
The
Deposit Agreement, the provisions of or governing Deposited Securities and
any
written communications from the Company, which are both received by the
Custodian or its nominee as a holder of Deposited Securities and made generally
available to the holders of Deposited Securities, are available for inspection
by Holders at the offices of the Depositary and the Custodian and at the
Transfer Office. The Depositary will mail copies of such communications (or
English translations or summaries thereof) to Holders when furnished by the
Company. The Company is subject to the periodic reporting requirements of the
Securities Exchange Act of 1934 and accordingly files certain reports with
the
United States Securities and Exchange Commission (the "Commission"). Such
reports and other information may be inspected and copied at public reference
facilities maintained by the Commission located at the date hereof at 100 F
Street, N.E., Washington, D.C. 20549.
(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: |
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JPMORGAN CHASE BANK, N.A., as
Depositary |
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By
........................................................ |
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Authorized
Officer |
The
Transfer Office is currently located at 4 New York Plaza, New York, New York
10004
[FORM
OF
REVERSE OF ADR]
(10)
Distributions
on Deposited Securities.
Subject
to paragraphs (4), (5) and (7), the Depositary will distribute as promptly
as
practicable by mail, to the extent distribution by mail is practicable, 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 reasonably practicable basis, subject to (i) appropriate adjustments
for
taxes withheld, (ii) such distribution being impermissible pursuant to
applicable law with respect to certain Holders, and (iii) deduction of the
Depositary's expenses in (1) converting any foreign currency to U.S. dollars
by
sale or in such other manner as the Depositary may determine to the extent
that
it determines that such conversion may be made on a reasonable basis, (2)
transferring foreign currency or U.S. dollars to the United States by such
means
as the Depositary may determine to the extent that it determines that such
transfer may be made on a reasonable basis, (3) obtaining any approval or
license of any governmental authority required for such conversion or transfer,
which is obtainable at a reasonable cost and within a reasonable time and (4)
making any sale by public or private means in any commercially reasonable
manner. (b) Shares.
(i)
Additional ADRs evidencing whole ADSs representing any Shares available to
the
Depositary resulting from a dividend or free distribution on Deposited
Securities consisting of Shares (a "Share Distribution") and (ii) U.S. dollars
available to it resulting from the net proceeds of sales of Shares received
in a
Share Distribution, which Shares would give rise to fractional ADSs if
additional ADRs were issued therefor, as in the case of Cash. (c) Rights.
(i)
Warrants or other instruments in the discretion of the Depositary after
consultation with the Company if practicable representing rights to acquire
additional ADRs in respect of any rights to subscribe for additional Shares
or
rights of any nature available to the Depositary as a result of a distribution
on Deposited Securities ("Rights"), to the extent that the Company timely
furnishes to the Depositary evidence satisfactory to the Depositary that the
Depositary may lawfully distribute the same (the Company has no obligation
to so
furnish such evidence), or (ii) to the extent the Company does not so furnish
such evidence and sales of Rights are practicable, any U.S. dollars available
to
the Depositary from the net proceeds of sales of Rights as in the case of Cash,
or (iii) to the extent the Company does not so furnish such evidence and such
sales cannot practicably be accomplished by reason of the nontransferability
of
the Rights, limited markets therefor, their short duration or otherwise, nothing
(and any Rights may lapse). (d) Other
Distributions.
(i)
Securities or property available to the Depositary resulting from any
distribution on Deposited Securities other than Cash,Share Distributions and
Rights ("Other Distributions"), by any means that the Depositary may deem
equitable and practicable, or (ii) to the extent the Depositary deems
distribution of such securities or property not to be equitable and practicable,
any U.S. dollars available to the Depositary from the net proceeds of sales
of
Other Distributions as in the case of Cash. The Depositary shall endeavor to
conduct any sales hereunder in a commercially reasonable manner. Such U.S.
dollars available will be distributed by checks drawn on a bank in the United
States for whole dollars and cents (any fractional cents being withheld without
liability for interest and dealt with by the Depositary in accordance with
its
then current procedures). Notwithstanding the foregoing, no distribution to
Holders pursuant to this paragraph (10) shall be unreasonably delayed by any
action of the Depositary or its agents.
(11) Conversion
of Foreign Currency.
Whenever the Depositary or the Custodian shall receive foreign currency, as
a
cash dividend or other distribution or as the net proceeds from the sale of
securities, property or rights, which, in the judgment of the Depositary can
then be converted on a reasonable basis into U.S. dollars which can, at the
time
of receipt thereof, be transferred to the United States, the Depositary shall,
as promptly as practicable, convert or cause to be converted, by sale or in
any
other manner that it may determine, such foreign currency into U.S. dollars
and
shall transfer the resulting U.S. dollars (net of its charges and expenses
in
effecting such conversion) to the United States. Such U.S. dollars shall be
distributed as promptly as practicable to the Holders entitled thereto or,
if
the Depositary shall have distributed any warrants or other instruments that
entitle the holders thereof to such U.S. dollars, then to the holders of such
warrants or instruments, as applicable, upon surrender thereof for cancellation.
Such distribution may be made upon an averaged or other practicable basis
without regard to any distinctions among Holders on account of exchange
restrictions or otherwise. If such conversion or distribution can be effected
only with the approval or license of any government or agency thereof, the
Depositary shall, unless prohibited pursuant to applicable law or otherwise
impracticable in the reasonable opinion of the Depositary after consultation
with the Company if practicable, file such application for approval or license,
if any; provided, however that the Depositary shall be entitled to rely upon
Swiss local counsel in such matters, which counsel shall be instructed to act
as
promptly as possible.. The Company shall not be obliged to make any such filing
on behalf of the Depositary. If at any time the Depositary shall determine
that
in its judgment any foreign currency received by the Depositary is not
convertible on a reasonable basis into U.S. dollars transferable to the United
States, or if any approval or license of any governmental authority or agency
thereof that is required for such conversion is denied or in the opinion of
the
Depositary is not obtainable at a reasonable cost or within a reasonable period,
the Depositary may, subject to applicable laws and regulations, either
distribute the foreign currency (or an appropriate document evidencing the
right
to receive such foreign currency) to, or hold such foreign currency (without
liability for interest thereon) for the respective accounts of, the Holders
entitled to receive the same; provided,
however,
that if
requested in writing by a Holder entitled thereto, the Depositary may, in its
discretion, distribute the foreign currency, as promptly as practicable. If
any
such conversion of foreign currency, in whole or in part, can be effected for
distribution to some but not all of the Holders entitled thereto, the Depositary
shall make such conversion and distribution in U.S. dollars to the extent
permissible to the Holders entitled thereto and may either so distribute or
hold
such balance (without liability for interest thereon) for the respective
accounts of, the Holders entitled thereto for whom such conversion and
distribution is not practicable; provided,
however,
that if
requested in writing by a Holder entitled thereto, the Depositary may, in its
discretion, distribute the foreign currency, as promptly as
practicable.
(12) Record
Dates.
The
Depositary may, after consultation with the Company, if practicable, fix a
record date (which shall be as near as practicable to any corresponding record
date set by the Company) for the determination of the Holders who shall be
entitled to receive any distribution on or in respect of Deposited Securities,
to give instructions for the exercise of any voting rights, to receive any
notice or to act in respect of other matters and only such Holders shall be
so
entitled.
(13)
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 shall mail to Holders a notice stating (a) such
information as is contained in such notice and any solicitation materials (or
a
summary thereof), (b) that each Holder on the record date set by the Depositary
therefor will be entitled, subject to applicable law and the provisions of
or
governing Deposited Securities (including, without limitation, the provisions
of
the Company's Articles of Incorporation as in effect from time to time and
resolutions and regulations of the Company's Board of Directors adopted pursuant
to such Articles of Incorporation, which provisions, and, if applicable,
resolutions and regulations shall be summarized in a form provided by the
Company) to instruct the Depositary as to the exercise of the voting rights,
if
any, pertaining to the Deposited Securities represented by the ADSs evidenced
by
such Holder's ADRs and (c) the manner in which such instructions may be given,
including instructions to give a discretionary proxy to a person designated
by
the Company. Upon receipt of instructions of a Holder on such record date in
the
manner and on or before the date established by the Depositary for such purpose,
the Depositary shall endeavor insofar as practicable and permitted under the
provisions of or governing Deposited Securities to vote or cause to be voted
(or
to grant a discretionary proxy to a person designated by the Company) 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. 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) that the
Company does not wish such proxy given.
Notwithstanding
anything to the contrary contained herein, the Depositary shall not be obligated
to give any such deemed instruction unless and until the Depositary has been
provided with an opinion, which may be given at the time of entering into the
Deposit Agreement, of counsel to the Company (which may be internal counsel),
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 Switzerland, (ii) the granting of such proxy will
not
result in a violation of Swiss law, rule, regulation or permit and (iii) the
voting arrangement and proxy as contemplated herein will be given effect under
Swiss law. If after the date such opinion is delivered to the Depositary the
Company is advised by counsel that there has occurred a change in Swiss law
such
that the foregoing opinion could no longer be rendered favorably in whole or
in
part, the Company shall promptly notify the Depositary of such change and the
Depositary shall thereafter have no obligation to give any such discretionary
proxy. The Company agrees to direct its counsel to inform it of any such changes
in Swiss law.
Pursuant
to the Company's Articles of Incorporation, the Board of Directors of the
Company may refuse to recognize the voting rights (and the rights connected
therewith) of any holder of Shares (in the form of Shares and/or ADRs or
otherwise) in respect of Shares held, directly or indirectly, singly or in
combination or concert with other entities by agreement or otherwise, in excess
of 2% of the Company's share capital at any time entered in the Commercial
Register of the Canton of Basle City. The holdings of affiliated legal entities,
including, but not limited to corporations and partnerships, are aggregated
for
the purposes of this limitation. The Company has agreed to exempt the Depositary
and the Custodian and their respective nominees if any (but no individual
Holder) from this limitation in respect of Deposited Securities held in
connection with the Company's ADR program up to a limit of 15% of the Company's
share capital at any time entered in the Commercial Register of the Canton
of
Basle City. The Depositary will inform the Company if the Depositary reaches
14.5% of the Company's share capital at any time entered in such Commercial
Register, at which time the Company will review and may increase the 15%
limitation. In the event this 15% limitation is not increased, the Company
may
refuse to recognize the voting rights of any Holder regardless of the Holder's
individual percentage share ownership or whether the Holder has complied with
any disclosure requirements. This limitation shall not apply to any rights
other
than voting (and the rights connected therewith), such as rights relating to
dividends or transfer.
In
addition, the Company has the right not to recognize votes of Deposited
Securities or other Company Shares held by (a) any Holder in excess of the
two
per cent limitation and/or (b) any Holder or other person holding an interest
in
an ADR who has not complied with the disclosure obligations of paragraph (6)
hereof. The Company reserves the right to instruct Holders to deliver their
ADRs
for cancellation and withdrawal of the Deposited Securities so as to permit
the
Company to re-register such withdrawn Deposited Securities as Shares without
voting rights. The Company may also refuse to allow such Holder to redeposit
such Shares into the ADR facility.
The
Shares are registered shares the transfer of which (for so long as they are
book-entry shares) is effected by use of the share registration form and by
a
corresponding entry in the books of a bank or depositary institution following
an assignment in writing by the selling shareholder and notification of such
assignment to the Company. In the event that the Shares will be printed, the
transfer is effected by delivery of the endorsed share certificate. The transfer
of Shares further requires that the name of the purchaser be registered in
the
Share Register of the Company. Failing such registration, the purchaser of
such
Shares underlying the ADSs may not vote at general meetings of the Company.
All
voting rights with respect to the Shares are subject to Swiss law.
(14)
Changes
Affecting Deposited Securities.
Subject
to paragraphs (4) and (5), the Depositary may, in its discretion, and shall
if
the Company shall so request, amend this ADR or distribute additional or amended
ADRs (with or without calling this ADR for exchange) or cash, securities or
property on the record date set by the Depositary therefor to reflect any change
in par value, split-up, consolidation, cancellation or other reclassification
of
Deposited Securities, any Share Distribution or Other Distribution not
distributed to Holders or any cash, securities or property available to the
Depositary in respect of Deposited Securities from (and the Depositary is hereby
authorized to surrender any Deposited Securities to any person and to sell
by
public or private sale any property received in connection with) any
recapitalization, reorganization, merger, consolidation, liquidation,
receivership, bankruptcy or sale of all or substantially all the assets of
the
Company, and to the extent the Depositary does not so amend this ADR or make
a
distribution to Holders to reflect any of the foregoing, or the net proceeds
thereof, whatever cash, securities or property results from any of the foregoing
shall constitute Deposited Securities and each ADS evidenced by this ADR shall
automatically represent its pro rata interest in the Deposited Securities as
then constituted.
(15)
Exoneration.
The
Depositary, the Company, their respective directors, employees, officers, agents
or affiliates and each of them shall: (a) incur no liability (i) if any present
or future law, regulation, order, decree, moratorium, fiat, the provisions
of or
governing any Deposited Securities and the Memorandum and Articles of
Incorporation of the Company, act of God, war or other circumstance beyond
its
control shall prevent, delay or subject to any civil or criminal penalty or
restraint or any act which the Deposit Agreement or this ADR provides shall
be
done or performed by it, or (ii) by reason of any exercise or failure to
exercise any discretion given it in the Deposit Agreement, this ADR or the
Memorandum and Articles of Incorporation of the Company; (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)
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; or (d)
not
be liable for any action or inaction by it in reliance upon the advice of or
information from legal counsel, accountants, any person presenting Shares for
deposit, any Holder, or any other person believed by it to be competent to
give
such advice or information. The Depositary, its agents and the Company may
rely
and shall be protected in acting upon any written notice, request, direction
or
other document believed by them to be genuine and to have been signed or
presented by the proper party or parties. The Depositary and its agents will
not
be responsible for any failure to carry out any instructions to vote any of
the
Deposited Securities, for the manner in which any such vote is cast or for
the
effect of any such vote. The Depositary and its agents may own and deal in
any
class of securities of the Company and its affiliates and in ADRs. The Company
has agreed to indemnify the Depositary and its agents under certain
circumstances and the Depositary and its agents have agreed to indemnify the
Company under certain circumstances. No disclaimer of liability under the
Securities Act of 1933 is intended by any provision hereof.
(16)
Resignation
and Removal of Depositary; the Custodian.
The
Depositary may resign as Depositary by written notice of its election to do
so
delivered to the Company, or be removed as Depositary by the Company by written
notice of such removal delivered to the Depositary; such resignation or removal
shall take effect upon the appointment of and acceptance by a successor
depositary. The Depositary may, after consultation with the Company if
practicable, appoint substitute or additional Custodians and the term
"Custodian"
refers
to each Custodian or all Custodians as the context requires.
(17)
Amendment.
Subject
to the last sentence of paragraph (2), the ADRs and the Deposit Agreement may
be
amended by the Company and the Depositary, provided
that any
amendment that imposes or increases any fees or charges (other than stock
transfer or other taxes and other governmental charges, transfer or registration
fees, cable, telex or facsimile transmission costs, delivery costs or other
such
expenses), or that shall otherwise prejudice any substantial existing right
of
Holders, shall become effective 30 days after notice of such amendment shall
have been given to the Holders. Every Holder of an ADR at the time any amendment
to the Deposit Agreement so becomes effective shall be deemed, by continuing
to
hold such ADR, to consent and agree to such amendment and to be bound by the
Deposit Agreement as amended thereby. In no event shall any amendment impair
the
right of the Holder of any ADR to surrender such ADR and receive the Deposited
Securities represented thereby, except in order to comply with mandatory
provisions of applicable law. By holding this ADR or an interest therein, the
parties hereto, including any Holder hereof and beneficial owner herein agree
that any amendments or supplements which (i) are reasonably necessary (as agreed
by the Company and the Depositary) in order for (a) the ADSs to be registered
on
Form F-6 under the Securities Act of 1933 or (b) the ADSs or Shares to be traded
solely in electronic book-entry form and (ii) do not in either such case impose
or increase any fees or charges to be borne by Holders, shall be deemed not
to
prejudice any substantial rights of Holders. Notwithstanding the foregoing,
if
any governmental body should adopt new laws, rules or regulations which would
require amendment or supplement of the Deposit Agreement or the form of ADR
to
ensure compliance therewith, the Company and the Depositary may amend or
supplement the Deposit Agreement and the ADR at any time in accordance with
such
changed rules. Such amendment or supplement to the Deposit Agreement in such
circumstances may become effective before a notice of such amendment or
supplement is given to Holders or within any other period of time as required
for compliance.
(18)
Termination.
The
Depositary may, and shall at the written direction of the Company, terminate
the
Deposit Agreement and this ADR by mailing notice of such termination to the
Holders at least 30 days prior to the date fixed in such notice for such
termination. After the date so fixed for termination, the Depositary and its
agents will perform no further acts under the Deposit Agreement and this ADR,
except to receive and hold (or sell) distributions on Deposited Securities
and
deliver Deposited Securities being withdrawn. As soon as practicable after
the
expiration of six months from the date so fixed for termination, the Depositary
shall sell the Deposited Securities and shall thereafter (as long as it may
lawfully do so) hold in a segregated account the net proceeds of such sales,
together with any other cash then held by it under the Deposit Agreement,
without liability for interest, in trust for the pro rata
benefit
of the Holders of ADRs not theretofore surrendered. After making such sale,
the
Depositary shall be discharged from all obligations in respect of the Deposit
Agreement and this ADR, except for its obligations to the Company under Section
16 of the Deposit Agreement and 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.