Agreement No. 3-2022 of April 27, 2022 Modifying Agreement No. 4-2003

REPUBLIC OF PANAMA BOARD OF DIRECTORS SUPERINTENDENCE OF THE SECURITIES MARKET Agreement No. 3-2022 (From April 27, 2022) "Modifying Agreement No. 4-2003 of April 11, 2003"

THE BOARD OF DIRECTORS

In exercise of its legal powers and

CONSIDERING

That Law 67 of September 1, 2011, reformed Decree-Law 1 of July 8, 1999, and created the Superintendence of the Securities Market (hereinafter: the Superintendence), as an autonomous entity of the State, with legal personality, its own assets, and administrative, budgetary, and financial independence.

That the Board of Directors, in accordance with Articles 5, 6, 10 (numeral 1), 19, and 20 of the Unified Text of the Securities Market Law (hereinafter: Unified Text), acts as the Highest Body for consultation, regulation, and setting of the general policies of the Superintendence, and has among its attributes the power to adopt, reform, and revoke Agreements that develop the provisions of the Securities Market Law.

That the Superintendence, by virtue of Article 3 of the Unified Text, has the general objective of regulating, supervising, and auditing the activities of the securities market developed in the Republic of Panama or from it, promoting legal certainty for all market participants and guaranteeing transparency, with special protection of investors' rights.

That the Superintendence has considered it necessary to analyze the issue of increasing the amount of a registered issuance, as well as the change in the type of registered security, based on requests or consultations received, taking as a basis the procedures adopted for the registration of securities and for the registration of modifications to terms and conditions of registered securities.

That the procedure for the registration of securities has been in effect since the year 2000, through Agreement No. 6-2000 of May 19, 2000, adopted by the former National Securities Commission, which was repealed and replaced by Agreement No. 2-2010 of April 16, 2010, which remains in effect to date, with various modifications.

That the procedure for the registration of modifications to terms and conditions of registered securities was adopted three years later by the former National Securities Commission, through Agreement No. 4-2003 of April 11, 2003, taking as a basis that the Regulator has the authority to establish procedures and requirements for the registration of securities that are subject to public offerings. Therefore, since modifications to the terms and conditions of securities are essential in such registrations, it was appropriate to regulate a specific procedure for such purposes.

That Agreement No. 4-2003 of April 11, 2003, was modified by Agreement No. 6-2020 of May 21, 2020, by Agreement No. 8-2020 of August 4, 2020, and by Agreement No. 8-2021 of December 9, 2021.

That, starting from Law 67 of September 1, 2011, in its Article 38, numeral 5, the fee for the registration of the modification of terms and conditions of an issuance was incorporated into the Securities Market Law, assigning it at that time a fixed amount of one thousand balboas (B/.1,000.00), and additionally, the following was established: "An increase in the amount of an issuance shall not be understood as a modification to the terms and conditions of an issuance."

That through Law 66 of December 9, 2016, the Unified Text was modified, and among other changes, the fee for the registration of the modification of terms and conditions of an issuance was increased to five thousand balboas (B/.5,000.00), but that provision regarding: "An increase in the amount of an issuance shall not be understood as a modification to the terms and conditions of an issuance" was omitted.

That the Superintendence modified the amount of the aforementioned registration fee, through General Resolution SMV No. JD-6-20 of June 23, 2020, and General Resolution SMV No. JD-3-21 of July 14, 2021, fixing it at B/.10,000.00, when the modification of terms and conditions of an issuance is processed through the procedure adopted in Agreement No. 4-2003 of April 11, 2003, and at B/.3,000.00, when the modification of terms and conditions of an issuance is processed through the procedure adopted in Agreement No. 3-2021 of July 14, 2021.

That, from the adoption of the procedure for the registration of modifications to terms and conditions of registered securities at the Superintendence until the beginning of the current year, no requests or consultations had been received regarding the increase in the amount of a registered issuance or for the modification of the type of registered security, through the procedure contemplated in Agreement No. 4-2003 of April 11, 2003.

That Agreement No. 4-2003 of April 11, 2003, establishes in its Article 1 that modifications to registered and circulating securities shall be understood as those changes that result in reforms to the terms and conditions established in the title and documents supporting the offering, expressed in the original information prospectus with which a public offering of securities was duly registered with the Superintendence, such as: a.) maturity date of the securities, interest payment dates (when applicable) or capital; b.) interest rates; c.) redemption date of the securities, form or grounds for requesting redemption of the securities; and d.) guarantees and/or backing of the issuance: understood as such those mechanisms that seek to ensure holders the payment of invested capital and interest, when applicable, such as for example: real guarantees, personal guarantees, trust agreement, amortization funds, among others.

That the procedure adopted in Agreement No. 4-2003 of April 11, 2003, was not designed to contemplate modifications in the amount and/or type of security of a registered issuance, since these are characteristics proper to the public offering, essential elements within the structure or program originally presented to the Superintendence for its review, which were subject or subordinate to the registration granted by this Regulator. For this reason, it can be seen that the respective registration fee is percentage-based and takes as a calculation base the amount authorized to be registered, unlike the registration fee for the modification of terms and conditions of an issuance, which is established with a fixed amount.

That the increase in the amount of a registered issuance at the Superintendence or the change in the type of registered securities is a procedure incompatible with the nature of the registration fee contemplated for the modification of terms and conditions, it undermines the registration itself carried out by the Superintendence, which took as a basis the amount of the issuance and the structure or program originally presented, seen in the fact that the increase in the amount could affect the issuer's financial indicators, the issuer's risk rating, and the registered securities, the guarantees of the issuance, among other aspects not contemplated in that structure or program originally presented to the Superintendence.

That the types of modifications described above in an issuance registered with the Superintendence generate concern, insofar as they not only alter characteristics proper to the public offering, which at the time favored holders in making their investment decision, but could also affect their rights, taking into account scenarios not originally foreseen in the public offering that could take place, such as the variation in decision-making power regarding future modifications to the terms and conditions.

That, in this sense, it should be noted that Article 323 of the Unified Text establishes that when the Superintendence contemplates reforming an Agreement, it must consider to determine if the action is necessary and appropriate: (a) the public interest, (b) the protection of investors, and (c) if the action promotes efficiency, market competition, and capital formation.

That Article 327 of the Unified Text determines that the Superintendence may adopt Agreements in situations of urgency, which imply a danger to the investing public and require immediate action, without having to comply with the public consultation process provided for in Articles 323 to 325 of the Unified Text. In such cases, the Superintendence may adopt only those Agreements that are necessary to prevent, avoid, or minimize said danger.

That the situation previously stated requires immediate action by the Superintendence, specially aiming to protect the rights of investors, who could be affected by requests for registration of modification of the amount of the registered issuance or for the change of the type of registered securities, under the procedure established in Agreement No. 4-2003 of April 11, 2003. Therefore, the Superintendence, based on what is determined in Article 327 of the Unified Text, has decided to adopt this Agreement.

Therefore, the Board of Directors of the Superintendence of the Securities Market, in exercise of its legal powers,

AGREES:

ARTICLE FIRST: MODIFY Article 1 of Agreement No. 4-2003 of April 11, 2003, as follows:

Article 1 (Scope of Application): Modifications to registered securities shall be understood as those changes that result in reforms to the terms and conditions established in the title and documents supporting the offering, expressed in the original information prospectus with which a public offering of securities was duly registered with the Superintendence of the Securities Market, such as (for example): a. Maturity date of the securities, dates and form of payment of interest (when applicable) or capital. b. Interest rates. c. Reasons and/or financial conditions. d. Redemption date of the securities, form or grounds for requesting redemption of the securities or other payments related to redemption. e. Guarantees and/or backing of the issuance: understood as such those mechanisms that seek to ensure holders the payment of invested capital and interest, when applicable, such as for example: real guarantees, personal guarantees, trust agreement, amortization funds, among others.

Any issuer wishing to modify the terms and conditions of a public offering of securities registered with the Superintendence of the Securities Market must comply with the provisions of this procedure.

The increase or decrease in the amount of an issuance, as well as the change in the type of securities previously registered with the Superintendence of the Securities Market, shall not be subject to modification under the procedure established in this Agreement, as they are considered constitutive elements of the offering itself and not as terms and conditions of an issuance susceptible to modification.

ARTICLE SECOND: EFFECTIVENESS. The provisions of this Agreement shall enter into force upon its publication in the Official Gazette.

PUBLISH AND COMPLY,

Adriana President of the Board of Directors

Secretary of the Board of Directors