Article 15p. 15

SPECIAL RULES OF PROCEDURE SUPPLEMENT TO THE RULES OF COURT

Section 24. Discharge of Rehabilitation Receiver. -

Upon termination of the rehabilitation proceedings, the

rehabilitation receiver shall submit his final report and

accounting with such period of time as the court will

allow him. Upon approval of his report and accounting,

the court shall order his discharge.

RULE 4 DEBTOR-INITIATED REHABILITATION

Section 1. Who May Petition. - Any debtor who foresees

the

impossibility

of

meeting its debts when they

respectively fall due, may petition the proper regional

trial court for rehabilitation.

A group of companies may jointly file a petition for

rehabilitation under these Rules when one or more of

its constituent corporations foresee the impossibility of

meeting debts when they respectively fall due, and the

financial

distress

would

likely

adversely

affect the

financial

condition

and/or

operations

of the other

member companies of the group is essential under the

terms and conditions of the proposed rehabilitation

plan.

Section 2. Contents of Petition. -

(a) The petition filed by the debtor must be verified and

must

set

forth

with sufficient particularity all the

following material facts: (1) the name and business of

the debtor; (2) the nature of the business of the debtor;

(3) the history of the debtor; (4) the cause of its inability

to

pay

its

debts;

(5)

all

the

pending

actions

or

proceedings known to the debtor and the courts or

tribunals

where

they

are

pending;

(6)

threats

or

demands to enforce claims or liens against the debtor;

and (7) the manner by which the debtor may be

rehabilitated and how such rehabilitation may benefit

the

general

body

of

creditors,

employees

and

stockholders.

(b) The petition shall be accompanied by the following

documents:

(1) An audited financial statement of the debtor at the

end of its last fiscal year;

(2) Interim financial statements as of the end of the

month prior to the filing of the petition;

(3) A Schedule of Debts and Liabilities which lists all the

creditors of the debtor, indicating the name and last

address of record of each creditor; the amount of each

claim as to principal, interest, or penalties due as of the

date of filing; the nature of the claim; and any pledge,

lien, mortgage judgement or other security given for

the payment thereof;

(4)

An

Inventory

of

Assets

which

must

list

with

reasonable specificity all the assets of the debtor,

stating the nature of each asset, the location and

condition thereof, the book value or market value of the

asset, and attaching the corresponding certificate of

title thereof in case of real property, or the evidence of

title or ownership in case of movable property, the

encumbrances, liens or claims thereon, if any, and the

identities

and

addresses

of

the

lienholders

and

claimants. The Inventory shall include a Schedule of

Accounts Receivable which must indicate the amount

of each, the persons from who due, the date of maturity

and the degree of collectibility categorizing them as

highly collectible to remotely collectible;

(5) A rehabilitation plan which conforms with the

minimal requirements set out in Section 18 of Rule 3;

(6) A Schedule of Payments and Disposition of Assets

which the debtor may have effected within three (3)

months

immediately

preceding

the

filing

of

the

petition;

(7) A Schedule of Cash Flow of the debtor for three (3)

months

immediately

preceding

the

filing

of

the

petition, and a detailed schedule of the projected cash

flow for the succeeding three (3) months;

(8) A Statement of Possible Claims by or against the

debtor which must contain a brief statement of the

facts

which might give rise to the claim and an

estimate of the probable amount thereof;

(9) An Affidavit of General Financial Condition which

shall contain answers to the questions or matters

prescribed in Annex "A" hereof;

(10) At least three (3) nominees for the position of

rehabilitation receiver as well as their qualifications and

addresses, including but not limited to their telephone

numbers, fax numbers and e-mail address; and

(11) A certificate attesting under oath that (i) the filing of

the petition has been duly authorized; and (ii) the

directors

and

stockholders

of

the

debtor

have

irrevocably

approved

and/or

consented

to,

in

accordance with existing laws, all actions or matters

necessary

and desirable to rehabilitate the debtor

including, but not limited to, amendments to the

articles of incorporation and by-laws or articles of

partnership; increase or decrease in the authorized

capital

stock;

issuance

of

bonded

indebtedness;

alienation, transfer, or encumbrance of assets of the

debtor; and modification of shareholders' rights.

(c) Five (5) copies of the petition shall be filed with the

court.

Section 3. Verification by Debtor. - The petition filed by

the

debtor

must

be verified by an affidavit of a

responsible officer of the debtor and shall be in a form

substantially as follows:

"I, ___________________, (position) of (name of petitioner),

do solemnly swear that the petitioner has been duly

authorized to file the petition and that the stockholders

and

board

of

directors

(or

governing

body)

have

approved and/or consented to, accordance with law, all

actions or matters necessary or desirable to rehabilitate

the debtor. The petition is being filed to protect the

interests of the debtor, the stockholders, the inventors

and the creditors of the debtor, which warrant the

appointment of a rehabilitation receiver. There is no

petition for insolvency filed with any other body, court

of tribunal affecting the petitioner. The Inventory of

Assets

and

the

Schedule

of

Debts

and Liabilities

contains a full, correct and true description of all debts

and liabilities and of all goods, effects, estate and

property

of

whatever

kind

of

class

belonging

to

petitioner. The Inventory also contains a full, correct and

true statement of all debts owing or due to petitioner,

or to any person or persons in trust for petitioner and of

all securities and contracts whereby any money may

hereafter become due or payable to petitioner or by or

through which any benefit or advantage may accrue to

petitioner. The petition contains a concise statement of

the facts giving rise, or which might give rise, to any

cause of action in favor of petitioner. Petitioner has no

land, money, stock, expectancy, or property of any kind,

except those set forth in the Inventory of Assets.

Petitioner has, in no instance, created or acknowledged

a debt for a greater sum than the true and correct

amount.

Petitioner,

its

officers,

directors

and

stockholders have not, directly or indirectly, concealed,

fraudulently sold or otherwise fraudulently disposed of,

any part of petitioner's real or personal property, estate,

effects or rights of action, and petitioner, its officers,

directors

and

stockholders

have

not

in

any

way

compounded with any of its creditors in order to give

preference to such creditors, or to receive or to accept

any profit or advantage therefrom, or to defraud or

deceive in any manner any creditor to whom petitioner

is

indebted.

Petitioner,

its

officers,

directors,

and

stockholders have been acting in good faith and with

due diligence.

Section 4. Opposition to or Comment on Petition. -

Every creditor of the debtor or any interested party shall

file his verified opposition to or comment on the

petition not later than fifteen (15) days before the date

of the initial hearing fixed in the stay order. After such

time, no creditor or interested party shall be allowed to

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