SC 13D

-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Al2NIePUW6BLqu8D+Ov/J/XWKehvy/7RIHpjnJ96EUFspdkuZritUEwY/gQtGBYv q+uBVvUFxsZnDbDUTaEsKw== 0000950123-08-013431.txt : 20081024 0000950123-08-013431.hdr.sgml : 20081024 20081024151748 ACCESSION NUMBER: 0000950123-08-013431 CONFORMED SUBMISSION TYPE: SC 13D PUBLIC DOCUMENT COUNT: 6 FILED AS OF DATE: 20081024 DATE AS OF CHANGE: 20081024 GROUP MEMBERS: TELEFONICA INTERNACIONAL, S.A.U. SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: CHINA UNICOM (HONG KONG) Ltd CENTRAL INDEX KEY: 0001113866 STANDARD INDUSTRIAL CLASSIFICATION: RADIO TELEPHONE COMMUNICATIONS [4812] IRS NUMBER: 000000000 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D SEC ACT: 1934 Act SEC FILE NUMBER: 005-51154 FILM NUMBER: 081139833 BUSINESS ADDRESS: STREET 1: 75TH FLOOR THE CENTER STREET 2: 99 QUEENS ROAD CENTRAL CITY: HONG KONG STATE: F4 ZIP: NA BUSINESS PHONE: 85221213220 MAIL ADDRESS: STREET 1: C/O KYLE KOMBRINK SULLIVAN & CROMWELL STREET 2: 1701 PENNSYLVANIA AVE NW CITY: WASHINGTON STATE: DC ZIP: 20005-5805 FORMER COMPANY: FORMER CONFORMED NAME: CHINA UNICOM LTD DATE OF NAME CHANGE: 20000509 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: TELEFONICA S A CENTRAL INDEX KEY: 0000814052 STANDARD INDUSTRIAL CLASSIFICATION: TELEPHONE COMMUNICATIONS (NO RADIO TELEPHONE) [4813] IRS NUMBER: 000000000 STATE OF INCORPORATION: U3 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D BUSINESS ADDRESS: STREET 1: GRAN VIA 28 CITY: 28013 MADRID STATE: U3 ZIP: 00000 BUSINESS PHONE: 00 34 91 584 0640 MAIL ADDRESS: STREET 1: GRAN VIA 28 CITY: 28013 MADRID STATE: U3 ZIP: 00000 FORMER COMPANY: FORMER CONFORMED NAME: NATIONAL TELEPHONE COMPANY OF SPAIN DATE OF NAME CHANGE: 19880708 SC 13D 1 y72073sc13d.htm SCHEDULE 13D SC 13D

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

(Rule 13d-101)

(Information to be Included in Statements Filed Pursuant to
§ 240.13d-1(a) and Amendments Thereto Filed
Pursuant to § 240.13d-2(a))

Under the Securities Exchange Act of 1934

China Unicom (Hong Kong) Limited

(Name of Issuer)

Ordinary shares of par value HK$0.10 per share
(Title of Class of Securities)

16945R 10 4

(CUSIP Number)

Chu Ka Yee
75/F, The Center
99 Queen’s Road Central
Hong Kong
Telephone: (852) 2126 2018
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)

October 15, 2008
(Date of Event Which Requires Filing of This Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§ 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. o


CUSIP No.		16945R 10 4	13D

NAME OF REPORTING PERSON

TELEFÓNICA, S.A.

CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP

(a) þ

(b) o

SEC USE ONLY

SOURCE OF FUNDS

CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)

CITIZENSHIP OR PLACE OF ORGANIZATION

THE KINGDOM OF SPAIN

SOLE VOTING POWER

NUMBER OF

None

SHARED VOTING POWER

BENEFICIALLY

OWNED BY

1,278,403,444¹

EACH

SOLE DISPOSITIVE POWER

REPORTING

PERSON

None

WITH

SHARED DISPOSITIVE POWER

1,278,403,444¹

AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

1,278,403,444¹

CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES

PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

5.38%

TYPE OF REPORTING PERSON

¹ Includes: (a) 1,000,136,542 ordinary shares beneficially owned by Telefónica Internacional as of the date of the present statement on this Schedule 13D (“Schedule 13D”), resulting from the exchange of a total 663,220,523 ordinary shares of China Netcom Group Corporation (Hong Kong) Limited upon completion of the merger of China Netcom Group Corporation (Hong Kong) Limited into China Unicom (Hong Kong) Limited, which became effective on October 15, 2008; and (b) 274,478,852 ordinary shares and the 3,788,050 ordinary shares underlying 378,805 American Depositary Shares acquired from AllianceBernstein L.P., for which closing is expected to take place on or about October 28, 2008.


CUSIP No.		16945R 10 4	13D

NAME OF REPORTING PERSON

TELEFÓNICA INTERNACIONAL, S.A.U.

CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP

(a) þ

(b) o

SEC USE ONLY

SOURCE OF FUNDS

CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)

CITIZENSHIP OR PLACE OF ORGANIZATION

THE KINGDOM OF SPAIN

SOLE VOTING POWER

NUMBER OF

None

SHARED VOTING POWER

BENEFICIALLY

OWNED BY

1,278,403,444²

EACH

SOLE DISPOSITIVE POWER

REPORTING

PERSON

None

WITH

SHARED DISPOSITIVE POWER

1,278,403,444²

AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

1,278,403,444²

CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES

PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

5.38%

TYPE OF REPORTING PERSON

² Includes: (a) 1,000,136,542 ordinary shares beneficially owned by Telefónica Internacional as of the date of this Schedule 13D, resulting from the exchange of a total 663,220,523 ordinary shares of China Netcom Group Corporation (Hong Kong) Limited upon completion of the merger of China Netcom Group Corporation (Hong Kong) Limited into China Unicom (Hong Kong) Limited, which became effective on October 15, 2008; and (b) 274,478,852 ordinary shares and the 3,788 ,050 ordinary shares underlying 378,805 American Depositary Shares acquired from AllianceBernstein L.P., for which closing is expected to take place on or about October 28, 2008.

TABLE OF CONTENTS


Introduction
	Item 1. Security and Issuer
	Item 2. Identity and Background
	Item 3. Source and Amount of Funds or Other Consideration
	Item 4. Purpose of Transaction
	Item 5. Interest in Securities of the Issuer
	Item 6. Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer
	Item 7. Material to be Filed as Exhibits
SIGNATURE
Exhibit Index
EX-99.1: SHARE PURCHASE AGREEMENT
EX-99.2: IRREVOCABLE UNDERTAKING
EX-99.3: JOINT FILING AGREEMENT

SCHEDULE 13D

Introduction

On September 15, 2008, a Schedule 13D (the “September 15th Schedule 13D”) was filed jointly by Telefónica, S.A., a corporation organized under the laws of the Kingdom of Spain (“Telefónica”), and Telefónica Internacional, S.A.U., a wholly-owned subsidiary of Telefónica (“Telefónica Internacional”), with respect to a share purchase agreement between Telefónica Internacional and AllianceBernstein L.P. for the acquisition of a total 178,721,782 ordinary shares, U.S.$0.04 par value per share (the “Shares”), and 2,512,000 ordinary shares underlying 125,600 American Depositary Shares issued by Citibank N.A. (the “ADSs”), of China Netcom Group Corporation (Hong Kong) Limited, a telecommunications company organized under the laws of Hong Kong (“China Netcom”). At closing on September 9, 2008, Telefónica Internacional paid the equivalent of HK$4,237,245,823 (approximately €368.0 million) as the aggregate purchase price for the Shares and ADSs.

On September 22, 2008, an Amendment No. 1 amending and supplementing the statement on the September 15th Schedule 13D was filed jointly by Telefónica and Telefónica Internacional with respect to the completion of the acquisition by Telefónica Internacional of an additional 148,015,436 ordinary shares, U.S.$0.04 par value per share (the “Additional Shares”), of China Netcom from Shanghai Alliance Investment Ltd., Information and Network Centre of the State Administration of Radio Film and Television, P.R.C., Chinese Academy of Sciences Holdings Co., Ltd., and China Railway Communications Center. At closing on September 23, 2008, Telefónica Internacional paid the equivalent of HK$3,460,304,862.8 (approximately €312.9 million) as the aggregate purchase price for the Additional Shares.

As a result of the acquisition of the Shares, the ADSs and the Additional Shares, Telefónica Internacional was the beneficial owner of a total of 663,220,523 ordinary shares of China Netcom, corresponding to approximately 9.90% of its share capital (the “China Netcom Interest”), which also included:

	(a)		196,882,473 ordinary shares acquired from CNC Fund, L.P. in June 2005; and

	(b)		137,088,832 ordinary shares acquired through open market purchases of (i) 132,794,816 ordinary shares from July to September 2005, (ii) 2,092,016 ordinary shares in December 2006, and (iii) 2,202,000 ordinary shares in December 2007.

On September 4, 2008, Telefónica Internacional entered into an additional share purchase agreement with AllianceBernstein L.P. for the acquisition of a second tranche (the “Second Tranche Acquisition”) in respect of 182,336,159 ordinary shares (the “Second Tranche Shares”) and 2,512,000 ordinary shares underlying 125,600 American Depositary Shares (the “Second Tranche ADSs”) of China Netcom, subject to adjustment at closing. (See Item 6 “Second Tranche Acquisition,” and Exhibit 1 to this Schedule 13D.) The Second Tranche Shares and Second Tranche ADSs were issued upon:

	(a)		The successful completion of the scheme of arrangement of China Netcom (the “Scheme”) through which China Netcom was to be merged into China Unicom Limited (subsequently renamed China Unicom (Hong Kong) Limited, in both instances, “China Unicom”), a telecommunications company organized under the laws of Hong Kong;

	(b)		The completion of the merger of China Netcom into China Unicom (the “Merger”), which became effective on October 15, 2008, as a result of which the China Netcom Interest was exchanged for a total 1,000,136,542 ordinary shares of the enlarged entity

			resulting from the Merger (“New China Unicom”), representing approximately a 4.21% interest in the share capital of New China Unicom; and

	(c)		The cancellation of all the ordinary shares, including the ordinary shares underlying the American Depositary Shares, of China Netcom in issue as of October 14, 2008, which was completed on October 15, 2008.

Upon completion of the Second Tranche Acquisition, Telefónica International’s pro-forma shareholding in New China Unicom following the successful completion of the Scheme will stand at approximately 5.38% of the share capital of New China Unicom. Closing for the Second Tranche Acquisition is expected to take place on or about October 28, 2008.

Item 1. Security and Issuer.

This Schedule 13D relates to the ordinary shares of par value HK$0.10 per share of New China Unicom (the “New China Unicom Shares”). The address of New China Unicom's registered office is 75/F, The Center, 99 Queen’s Road Central, Hong Kong.

Item 2. Identity and Background.

This Schedule 13D is filed by Telefónica, S.A., a corporation organized under the laws of the Kingdom of Spain, and its wholly-owned subsidiary Telefónica Internacional, S.A.U. The principal business address for Telefónica is Distrito C, Ronda de la Comunicación s/n, 28050, Madrid, Spain. Telefónica’s principal business is telecommunications.

The names, citizenship, business addresses and principal occupations or employments of the executive officers and directors of Telefónica are set forth in Schedule I hereto, which is incorporated herein by reference.

During the last five years, neither Telefónica nor, to the knowledge of Telefónica, any person named in Schedule I hereto has been (i) convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) or (ii) a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding were or are subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.

Item 3. Source and Amount of Funds or Other Consideration.

Upon completion of the Second Tranche Acquisition, Telefónica International’s pro-forma shareholding in the enlarged entity resulting from the Merger of China Netcom into China Unicom and following the completion of the Scheme will stand at approximately 5.38% of New China Unicom’s share capital. The Second Tranche Acquisition, for which closing is expected to take place on or about October 28, 2008, will be funded through internally generated funds. (See Introduction, Item 6 “Second Tranche Acquisition,” and Exhibit 1 to this Schedule 13D.)

Item 4. Purpose of Transaction.

Telefónica, through Telefónica Internacional, is acquiring the Second Tranche Shares for investment purposes. Telefónica intends to assess its investment in New China Unicom from time to time on the basis of various factors, including, without limitation, New China Unicom’s business, financial condition, results of operations and prospects, general economic, market and industry conditions, as well as other developments and other investment opportunities. Depending upon the foregoing factors or any other factors deemed relevant to Telefónica, it may acquire additional shares in New China Unicom, or dispose of all or part of the shares of New China Unicom, in open market transactions, privately negotiated transactions or otherwise. Any acquisition or disposition may be effected by Telefónica at any time without prior notice. Telefónica may engage, directly or through Telefónica Internacional, in communications from time to time with one or more stockholders, officers or directors of New China Unicom regarding New China Unicom’s operating performance, strategic direction or other matters that could result in or relate to, among other things, any of the matters set forth in subparagraphs (a) through (j) of Item 4 of Schedule 13D.

Except as described in this Schedule 13D, neither Telefónica nor Telefónica Internacional has any present plan or proposal that relates to, or could result in, any of the events referred to in paragraphs (a) through (j), inclusive, of Item 4 of Schedule 13D. Telefónica will, however, continue to review the business of New China Unicom and, depending upon one or more of the factors referred to above, may in the future propose that New China Unicom take one or more such actions.

Item 5. Interest in Securities of the Issuer.

(a) Telefónica Internacional currently is the beneficial owner of 1,278,403,444 ordinary shares of New China Unicom, or approximately 5.38% of its ordinary share capital, which includes (a) 274,478,852 ordinary shares, pursuant to the Second Tranche Acquisition, for which closing is expected to take place on or about October 28, 2008, and (b) 3,788,050 ordinary shares underlying 378,805 ADSs.

(b) Pursuant to a letter of undertaking obtained from Telefónica Internacional on June 1, 2008, Telefónica has agreed to vote in favor of the Scheme. (See Item 6 “Letter of Undertaking,” and Exhibit 2 to this Schedule 13D.) Other than such letter of undertaking, neither Telefónica, directly or through Telefónica Internacional, nor, to the best knowledge of Telefónica, any of its respective executive officers and directors listed on Schedule I hereto, has the power to vote or direct the vote, shared power to vote or direct the vote, power to dispose or direct the disposition, or shared power to dispose or direct the disposition of any of the New China Unicom Shares.

(c) Except as set forth in this Schedule 13D, neither Telefónica, directly or through Telefónica Internacional, nor, to the best knowledge of Telefónica, any of its respective executive officers and directors listed on Schedule I hereto, beneficially owns or has effected any transactions in the New China Unicom Shares during the past sixty (60) days.

(d) Except as set forth in this Schedule 13D, neither Telefónica, directly or through Telefónica Internacional, nor, to the best knowledge of Telefónica, any of its respective executive officers and directors listed on Schedule I hereto, has the right to receive or the power to direct the receipt of dividends from, or the proceeds of the sale of, the New China Unicom Shares.

(e) Not applicable.

Item 6. Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer.

Second Tranche Acquisition.

The following summary of certain material provisions of the share purchase agreement with respect to the Second Tranche Acquisition does not purport to be a full and complete description of such documents and is entirely qualified by reference to the full text of such documents attached as Exhibit 1 to this Schedule 13D.

On September 4, 2008, Telefónica Internacional and AllianceBernstein L.P., for itself and on behalf of its affiliates, entered into a share purchase agreement for the sale and purchase of 182,336,159 ordinary shares of China Netcom and the 2,512,000 ordinary shares underlying 125,600 American Depositary Shares of China Netcom, subject to adjustment at closing. The maximum number of ordinary shares of China Netcom Telefónica Internacional agreed to ultimately purchase is 203,152,256 (the “Second Tranche Total Shares”). The Second Tranche Total Shares are subject to the underlying entitlement to the ordinary shares and American Depositary Shares of China Unicom to be issued to AllianceBernstein L.P. and its affiliates pursuant to and in connection with the share exchange proposal (the “Share Proposal”) and the Scheme, including the withdrawal of the listing of China Netcom’s ordinary shares on the Hong Kong Stock Exchange and the delisting of China Netcom’s American Depositary Shares from the New York Stock Exchange, jointly announced by China Netcom and China Unicom on June 2, 2008.

The aggregate purchase price payable for the Second Tranche Total Shares shall be an average of the closing prices of the ordinary shares of China Netcom as quoted on the Hong Kong Stock Exchange for each of the 30 consecutive trading days immediately prior to the completion of the Scheme and the Share Proposal, subject to a minimum purchase price of HK$22.21 and a maximum purchase price of HK$24.55 per share. The purchase price is also subject to adjustment at closing for any monetary distributions paid to or declared by China Netcom and received or to be received by or on behalf of the sellers on or after September 4, 2008. The closing is conditional on, among other things, the completion of the Share Proposal and the Scheme (the “Closing Condition”). Unless otherwise agreed, the closing date for each transaction is the date five (5) business days after the date on which the Closing Condition was satisfied, which date is October 15, 2008, and in any event no later than December 15, 2008 or such later date as the parties may agree (the “Long Stop Date”).

Each party has the right to terminate the share purchase agreement for the Second Tranche Acquisition if the Closing Condition is not satisfied by the Long Stop Date. Each of the parties made customary warranties in connection with such sale and purchase. Each of AllianceBernstein L.P. and its affiliates also undertook to Telefónica Internacional that, until the Long Stop Date or the date the share purchase agreement is terminated, whichever is earlier, it shall not dispose of or enter into any agreement or arrangement to dispose of or permit the disposal of any of the applicable shares.

Letter of Undertaking.

The following summary of certain material provisions of the Letter of Undertaking (as defined below) does not purport to be a full and complete description of such document and is entirely qualified by reference to the full text of such document attached as Exhibit 2 to this Schedule 13D.

On June 1, 2008, Telefónica Internacional entered into a letter of undertaking with China Unicom in connection with China Netcom’s proposed merger into China Unicom pursuant to the Scheme (the “Letter of Undertaking”). A copy of the Letter of Undertaking is included as Exhibit 2 to this Schedule

13D, and the description of the undertakings contained herein is qualified in its entirety by reference to Exhibit 2 to this Schedule 13D, which is incorporated herein by reference.

Pursuant to the Letter of Undertaking, Telefónica Internacional has undertaken that it shall not, among other things, (a) other than pursuant to the Scheme, sell, transfer, charge, encumber, grant any option over or otherwise dispose of any interest in (i) any ordinary shares of China Netcom beneficially owned by Telefónica Internacional as of the date of such Letter of Undertaking or (ii) any other shares or securities in China Netcom issued or unconditionally allotted to it or otherwise acquired by it (such shares referred to in clauses (i) and (ii), collectively, the “Undertaking Shares”); (b) accept, or procure the acceptance of, any other offer in respect of the Undertaking Shares; (c) vote in favor of any resolution which might result in any condition of the Scheme not being fulfilled; (d) other than pursuant to the Scheme, enter into any agreement or arrangement or permit any agreement or arrangement to be entered into or authorize or incur any obligation (i) to do any of the acts referred to in (a), (b) and (c) above or (ii) which, in relation to the Undertaking Shares, would or might restrict or impede it voting in favor of the Scheme; (e) sell or otherwise dispose of any shares or other securities of China Unicom or any interest therein (including any derivatives referenced to such securities) or (f) requisition or join in requisitioning any general or class meeting of China Netcom without the prior consent of China Unicom.

Telefónica Internacional has also undertaken that it shall not directly or indirectly solicit or encourage any person other than China Unicom to make any offer for any shares or other securities of China Netcom or take any action which is or may be prejudicial to the successful outcome of the Scheme or which would or may have the effect of preventing any of the conditions of the Scheme from being fulfilled. Telefónica Internacional has further undertaken to exercise all voting rights attaching to the Undertaking Shares to vote in favor of all resolutions to approve the Scheme and any related matters necessary to implement the Scheme proposed at any general or class meeting of China Netcom (the “EGM”) and court convened meeting (the “Court Meeting”) to be convened and held in connection with the Scheme, or at any adjournment of any such meeting.

The Letter of Undertaking shall lapse if, among other things, (a) China Unicom announces, with the consent of the Securities and Futures Commission of Hong Kong and before the Scheme Document is posted, that it does not intend to proceed with the Scheme; (b) the Scheme is not approved at the EGM or the Court Meeting by November 30, 2008; (c) the Scheme lapses or is withdrawn in accordance with its terms; or (d) there is a higher competing offer for China Netcom. In addition, the Letter of Undertaking would lapse if (i) since the date of the Letter of Undertaking, there has been a material adverse change in the business, financial or trading position of China Unicom or (ii) the independent financial adviser appointed by the independent board committee of China Network does not render an opinion that certain proposals set forth in China Network’s and China Unicom’s joint announcement dated June 2, 2008 are fair and reasonable.

Item 7. Material to be Filed as Exhibits.

Exhibit 1:

Share Purchase Agreement, dated September 4, 2008, for the purchase of shares in China Unicom Limited between Telefónica Internacional, S.A.U. and AllianceBernstein L.P.

Exhibit 2:

Irrevocable Undertaking, dated June 1, 2008, between Telefónica Internacional, S.A.U. and China Unicom Limited.

Exhibit 3:

Joint Filing Agreement, dated October 24, 2008, between Telefónica, S.A. and Telefónica Internacional, S.A.U.

SIGNATURE

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

Dated: October 24, 2008


TELEFÓNICA, S.A.
By:	/s/ Maria Luz Medrano Aranguren
	Name:	Maria Luz Medrano Aranguren
	Title:	Group General Vice Counsel

TELEFÓNICA INTERNACIONAL, S.A.U.
By:	/s/ Juan Carlos Ros Brugueras
	Name:	Juan Carlos Ros Brugueras
	Title:	Attorney

Schedule I

Executive Officers and Directors of Telefónica

The directors and executive officers of Telefónica as of the date hereof are set forth below. The business address of each director or executive officer is that of Telefónica located at Distrito C, Ronda de la Comunicación s/n, 28050 Madrid, Spain. Unless noted otherwise, each of the named individuals is a citizen of the Kingdom of Spain.

Directors and Officers of Telefónica


	Position with	Present principal occupation (if different
Name and surname	Telefónica	from position with Telefónica)

*Members of the Board of Directors:*

César Alierta Izuel	Executive Chairman and Chairman

Isidro Fainé Casas	Vice Chairman	Chairman, Caja de Ahorros y Pensiones de Barcelona

Vitalino Manuel Nafría Aznar	Vice Chairman

Julio Linares López	Director and Chief Operating Officer

José María Abril Pérez	Director

Fernando de Almansa Moreno-Barreda	Director

José María Álvarez-Pallete López	Director	General Manager, Telefónica Latin America

David Arculus (citizen of the United Kingdom)	Director

Eva Castillo Sanz	Director	Head of Global Wealth Management for Europe, Middle East and Asia, Merrill Lynch

Carlos Colomer Casellas	Director	Chairman, Colomer Group

Peter Erskine (citizen of the United Kingdom)	Director

Alfonso Ferrari Herrero	Director

Luiz Fernando Furlán (citizen of the Federative Republic of Brazil)	Director

Gonzalo Hinojosa Fernández de Angulo	Director

Pablo Isla Álvarez de Tejera	Director	Deputy Chairman and CEO, Inditex, S.A.

Antonio Massanell Lavilla	Director	Senior Executive Vice President, Caja de Ahorros y Pensiones de Barcelona

Francisco Javier de Paz Mancho	Director

Sch. I-1


	Position with	Present principal occupation (if different
Name and surname	Telefónica	from position with Telefónica)

*Executive Officers:*

César Alierta Izuel	Chairman and Chief Executive Officer

Julio Linares López	Chief Operating Officer

José María Álvarez-Pallete López	General Manager, Telefónica Latin America

Guillermo Ansaldo Lutz	General Manager, Telefónica Spain

Matthew Key	General Manager, Telefónica Europe

Santiago Fernández Valbuena	General Manager of Finances and Corporate Development

Luis Abril Pérez	Technical General Secretary to the Chairman

Calixto Ríos Pérez	General Manager of Internal Audit

Ramiro Sánchez de Lerín García-Ovies	General Secretary and Secretary to the Board of Directors

Sch. I-2

Exhibit Index


Exhibit No.

1.		Share Purchase Agreement, dated September 4, 2008, for the purchase of shares in China Unicom Limited between Telefónica Internacional, S.A.U. and AllianceBernstein L.P.

2.		Irrevocable Undertaking, dated June 1, 2008, between Telefónica Internacional, S.A.U. and China Unicom Limited.

3.		Joint Filing Agreement, dated October 24, 2008, between Telefónica, S.A. and Telefónica Internacional, S.A.U.

EX-99.1 2 y72073exv99w1.htm EX-99.1: SHARE PURCHASE AGREEMENT EX-99.1

Exhibit 1

EXECUTION VERSION

ALLIANCEBERNSTEIN L.P.

AND

TELEFÓNICA INTERNACIONAL, S.A.U.

SHARE PURCHASE AGREEMENT
FOR THE PURCHASE
OF SHARES IN
CHINA NETCOM GROUP CORPORATION (HONG KONG) LIMITED

CONTENTS


Clause		Page

1.	INTERPRETATION		1

2.	SALE AND PURCHASE		5

3.	CLOSING CONDITION		6

4.	CLOSING		6

5.	REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS		8

6.	TERMINATION		11

7.	INDEMNITIES		12

8.	ACKNOWLEDGEMENTS		12

9.	COSTS AND TAXES		13

10.	FURTHER ASSURANCE		13

11.	ENTIRE AGREEMENT		13

12.	GENERAL		13

13.	NOTICES		14

14.	ARBITRATION		14

15.	GOVERNING LAW		15

16.	COUNTERPARTS		15

SCHEDULE 1			16

THIS SHARE PURCHASE AGREEMENT (this “Agreement”) is made on the 4^th day of September 2008

BETWEEN:

(1)		ALLIANCEBERNSTEIN L.P., a limited partnership established under the laws of Delaware whose principal office is at 1345 Avenue of the Americas, New York, NY10105 (“AB”) as principal and as agent for and on behalf of its Affiliates set out in Schedule 1 (AB and each such Affiliate collectively, the “Sellers”); and

(2)		TELEFÓNICA INTERNACIONAL, S.A.U., a company incorporated in Spain whose registered office is at Distrito C, Edificio Oeste 3, Ronda de la Comunicacíon s/n, 28050 Madrid, Spain (“Buyer”).

RECITALS:

(A)		China Netcom Group Corporation (Hong Kong) Limited is a company incorporated in Hong Kong whose registered office is at Room 6701, The Centre, 99 Queen’s Road Central, Hong Kong and whose Shares are listed on the Hong Kong Stock Exchange (the “Company”).

(B)		The Sale Shares (as defined below) are beneficially owned by AB’s or an Affiliate of AB’s asset management clients in managed accounts over which AB or an Affiliate of AB has investment discretion.

(C)		On 2 June 2008, the Company and Unicom (as defined below) jointly issued an announcement in relation to the proposed merger of the two companies by way of a scheme of arrangement under section 166 of the Companies Ordinance (Cap. 32 of the Laws of Hong Kong) (the “Scheme”) and the share exchange proposals (the “Share Proposal”). Pursuant to the Share Proposal, upon satisfaction or waiver of the relevant conditions of the Share Proposal, the Shares (as defined below) will be cancelled and in consideration thereof, shareholders of the Company will be entitled to receive 1.508 New Unicom Shares (as defined below) for each one Share (as defined below). It is currently contemplated that the Share Proposal and the Scheme will be completed in the fourth quarter of 2008.

(D)		Each of the Sellers agrees to sell to the Buyer, and the Buyer agrees to purchase from the Sellers, the Sale Shares, on the terms and conditions set out in this Agreement (the “Acquisition”).

THE PARTIES AGREE as follows:

1.		INTERPRETATION

1.1		In this Agreement:

		“Affiliate” means, in relation to a person, any other person which, directly or indirectly, controls, is controlled by or is under the common control of the first mentioned person, where “control” means the ownership, directly or indirectly, of more than 50 per cent of the voting shares, registered capital or other equity interest of the relevant person, or the possession, directly or indirectly, of voting rights sufficient to have a material effect on

-1-

the resolutions of the shareholders meeting, to appoint or elect a majority of the directors, or otherwise to direct the management of the relevant person;

		“Business Day” means a day other than a Saturday or Sunday or public holiday in Hong Kong, the United States of America or Spain;

		“Buyer Warranty” means each warranty given by the Buyer as provided in Clause 5.7;

		“CCASS” means the Central Clearing and Settlement System established and operated by Hong Kong Securities Clearing Company Limited;

		“Closing” means completion of the sale and purchase of the Sale Shares (which shall be construed as the New Unicom Shares and Unicom ADSs as at the Closing Date) in accordance with this Agreement;

		“Closing Condition” means the condition set out in Clause 3.1;

		“Closing Date” means the date which is the five Business Days after the date (not being later than the Long Stop Date (as defined in Clause 3.2)) on which the Closing Condition to be satisfied is satisfied, unless otherwise agreed by the Parties in writing as set out in Clause 4.1;

		“DTC” shall mean The Depository Trust Company, a national clearing house and the central book-entry settlement system for securities traded in the United States and, as such, the custodian for the securities of DTC participants maintained in DTC, and any successor thereto;

		“Encumbrance” means a mortgage, charge, pledge, lien, option, restriction, right of first refusal, right of pre-emption, third-party right or interest, assignment, deed of trust, other encumbrance or security interest of any kind, or another type of preferential arrangement (including, without limitation, a title transfer or retention arrangement) having similar effect, any proxy, power of attorney, voting trust arrangement, interest, option or right of first offer or any adverse claim as to title, possession or use;

		“Hong Kong” means The Hong Kong Special Administrative Region of the People’s Republic of China;

		“Hong Kong Stock Exchange” means The Stock Exchange of Hong Kong Limited;

		“Netcom ADSs” means the American Depositary Shares which are issued under the deposit agreement between Netcom and the Netcom Depositary and traded on the New York Stock Exchange, each representing ownership of 20 Shares;

		“Netcom Depositary” means Citibank, N.A. acting in its capacity as the depositary of the Netcom ADSs;

		“New Unicom ADSs” means the new Unicom ADSs to be issued to the Sellers pursuant to the ADSs Proposal (as defined in the Scheme Document) in consideration of the cancellation of the Shares underlying the Netcom ADSs of the Sellers, which will be traded on the New York Stock Exchange upon their issuance;

-2-

		“New Unicom Shares” means the new Unicom Shares to be issued to the Sellers pursuant to the Share Proposal in consideration of the cancellation of the Sale Listed Shares, which will be listed and traded on the Hong Kong Stock Exchange upon their issuance;

		“Purchase Price” means the aggregate purchase price as provided in Clause 2.2 and which may be adjusted, if appropriate, as provided in Clauses 2.2 and 2.3;

		“Relevant Claim” means a Warranty Claim or any claim for indemnification for breach of undertaking or provision in this Agreement by a Party;

		“Sale Listed Shares” means 182,336,159 Shares beneficially owned by the Sellers’ asset management clients in managed accounts over which the Sellers have investment discretion, which are listed and traded on the Hong Kong Stock Exchange and which may be adjusted in accordance with Clause 2.3.2; for the avoidance of doubt, all references to “Sale Listed Shares” shall be construed to include the underlying entitlement to the New Unicom Shares;

		“Sale Netcom ADSs” means 2,512,000 Shares underlying the 125,600 Netcom ADSs which are beneficially owned by the Sellers’ asset management clients in managed accounts over which the Sellers have investment discretion, and which will be traded on the New York Stock Exchange upon their issuance and which may be adjusted in accordance with Clause 2.3.2; for the avoidance of doubt, all references to “Sale Netcom ADS “ shall be construed to include the underlying entitlement to the New Unicom ADSs;

		“Sale Shares” means the Sale Listed Shares and the Sale Netcom ADSs which may be adjusted in accordance with Clause 2.3.2 and the underlying entitlement to the New Unicom Shares and the New Unicom ADSs; for the avoidance of doubt, as at the Closing Date, all references to the Sale Shares shall be construed as references to the New Unicom Shares and the New Unicom ADSs;

		“Scheme Document” means the circular setting out the terms and conditions of the Scheme jointly issued by the Company and Unicom to their respective shareholders and dated 15 August 2008;

		“Seller Warranty” means each warranty given by the Sellers as provided in Clause 5.4 and “Seller Warranties” shall be construed accordingly;

		“Sellers’ Broker” means Citigroup New York, Equity Capital Markets Desk;

		“SFO” means the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong);

		“Shares” means shares of par value US$0.04 each in the issued share capital of the Company;

		“Tax” means any form of taxation, withholding, levy, duty, charge, contribution or fee including, without limitation, any impost of whatever nature (including any fine, penalty, surcharge or interest in relation thereto) imposed by a local, municipal, provincial,

-3-

governmental, state, federal or other fiscal, revenue, customs or excise authority, body or official or other body or authority in any country;

		“Unicom” means China Unicom Limited, a company incorporated in Hong Kong whose registered office is at 75^th Floor, The Centre, 99 Queen’s Road Central, Hong Kong and the Unicom Shares and the Unicom ADSs are listed on the Hong Kong Stock Exchange and the New York Stock Exchange respectively;

		“Unicom ADSs” means the Unicom ADSs which are issued by the Unicom Depositary and traded on the New York Stock Exchange, each representing ownership of 10 Unicom Shares;

		“Unicom Depositary” means The Bank of New York Mellon acting in its capacity as the depositary of the Unicom ADSs;

		“Unicom Shares” means shares of par value of HK$0.10 each in the issued share capital of the Unicom which are listed on the Hong Kong Stock Exchange; and

		“Warranty Claim” means a claim by the Buyer or the Sellers (as the case may be) under or pursuant to the provisions of Clause 5.1 or 5.5 (as the case may be).

1.2

In this Agreement, a reference to:

	1.2.1		a Clause or Schedule, unless the context otherwise requires, is a reference to a clause of, or schedule to, this Agreement and references to this Agreement include the Schedule;

	1.2.2		a “person” includes a reference to any individual, firm, company, corporation or other body corporate, government, state or agency of a state or any joint venture, association or partnership, works council or employee representative body (whether or not having separate legal personality) and a reference to that person’s legal personal representatives, successors, permitted assigns and permitted transferees;

	1.2.3		“Parties” shall mean the parties to this Agreement and a “Party” shall be construed accordingly;

	1.2.4		the knowledge or awareness of or receipt of notice by the Sellers shall mean the actual knowledge of the Sellers, their respective officers and directors; and is deemed to include the knowledge that would have been obtained by the Sellers or any of their respective officers or directors after having made all such reasonable enquiries as a reasonably prudent buyer would make;

	1.2.5		the singular shall include the plural and vice versa and one gender includes all genders; and

	1.2.6		the headings in this Agreement are for reference only and shall not affect the interpretation of this Agreement.

-4-

2.		SALE AND PURCHASE

2.1		Each of the Sellers (as discretionary investment manager on behalf of its relevant asset management clients) agrees to sell and the Buyer agrees to buy the Sale Shares (which shall be construed as the New Unicom Shares and the New Unicom ADSs as at Closing) and each and every right attaching to the Sale Shares on or after the Closing Date including but not limited to any dividend on the Sale Shares (whether in cash or in kind) declared by the Company on or after the Closing Date, subject to the Seller Warranties and the terms and conditions set out herein. Each of the Sellers shall sell and the Buyer shall purchase all (but not part only) of the Sale Shares simultaneously.

2.2		Subject to adjustment at Closing as provided in Clause 2.3, the purchase price payable by the Buyer for each Sale Listed Share and each Share underlying each Sale Netcom ADSs shall be the arithmetic average of the closing prices of the Shares as quoted on the Hong Kong Stock Exchange for each of the thirty (30) consecutive trading days immediately prior to the completion of the Scheme and the Share Proposal (the “Average Closing Price”), provided that if the Average Closing Price per Share is HKD22.21 or lower, the purchase price shall be HKD22.21 for each Sale Listed Share and each Share underlying each Sale Netcom ADSs; and if the Average Closing Price is HKD24.55 or higher, the purchase price shall be HKD24.55 for each Sale Listed Share and each Share underlying each Sale Netcom ADSs. The indicative purchase price for each New Unicom Share and each Unicom Share underlying the New Unicom ADSs is set out in the Annex hereto for illustration purposes.

2.3		The Parties agree that, at Closing, the Purchase Price and/or the number of the Sale Listed Shares and/or the Sale Netcom ADSs shall be subject to the following adjustments:

	2.3.1		the Purchase Price shall be reduced by an amount equal to the amount of any type of monetary distribution paid to or declared by the Company in respect of the Sale Shares and received or to be received by or on behalf of the Sellers on or after the date of this Agreement (the “Adjusted Purchase Price”);

	2.3.2		subject to Clause 5.8, in the event that the number of the Sale Listed Shares and/or the Sale Netcom ADSs is increased or decreased as a result of the instructions from the Sellers’ clients with regard to closure, liquidation or increase of funding to their accounts managed by the Sellers, the number of the Sale Listed Shares and Sale Netcom ADSs shall be increased or decreased accordingly. The Buyer agrees to purchase the ultimate number of the Sale Listed Shares and Sale Netcom ADSs which may be equal to, more than or less than 184,848,159 Sale Shares subject to a maximum number of 203,152,256 Sale Shares, representing an increase of 5% over the current aggregate number of 366,081,941 Sale Shares managed by the Sellers under their investment discretion.

Each of the Sellers undertakes to the Buyer that it will promptly notify the Buyer of any cumulative increase or decrease in the number of the Sale Listed Shares and the Shares underlying the Sale Netcom ADSs by 5% or more and thereafter any further increase or decrease by 1% or more from the date hereof until the date of the satisfaction of the Closing Condition.

-5-

2.4		The Purchase Price or the Adjusted Purchase Price (as the case may be) for the Sale Shares shall be paid by the Buyer to the Sellers at Closing by wire transfer to a bank or brokerage account (i) designated in writing by the Sellers to the Buyer at least five (5) Business Days prior to the Closing Date or (ii) identified by the Sellers’ Broker to facilitate a delivery versus payment settlement for the transfers. Such transfer instruction for payment shall be irrevocable.

2.5		The Purchase Price or the Adjusted Purchase Price (as the case may be) in respect of the Sale Listed Shares shall be made in HK Dollars and in respect of the Netcom ADSs, shall be in US dollars at an exchange rate to be calculated based on the noon buying rate for US dollars in New York City cable transfers in HK Dollars as certified for customs purpose by the Federal Reserve Bank of New York two Business Days prior to the Completion Date.

3.		CLOSING CONDITION

3.1		Closing is conditional on the completion of the Share Proposal and the Scheme in accordance with the terms and conditions set out in the Scheme Document including for the avoidance of doubt, the withdrawal of the listing of the Shares on the Hong Kong Stock Exchange and the delisting of the Netcom ADSs from the New York Stock Exchange (the “Closing Condition”).

3.2		The Closing Condition is expected to be satisfied on or before 15 October 2008 and in any event no later than 15 December 2008 at 5:00pm Eastern Standard Time or such later date as the Parties may agree (the “Long Stop Date”).

3.3		If the Closing Condition has not been satisfied by the Long Stop Date, either Party has the right to terminate this Agreement with immediate effect. Each Party’s further rights and obligations cease immediately on termination, but termination does not affect a Party’s accrued rights and obligations at the date of termination.

4.		CLOSING

4.1		Closing shall take place on the fifth Business Day following satisfaction of the Closing Condition not being later than the Long Stop Date (the “Closing Date”) (or such other date or time as the Parties may agree in writing).

4.2		Subject to Clause 4.4, at Closing, the Sellers shall or shall procure that:

4.2.1

in respect of the New Unicom Shares, their designated CCASS participant gives an irrevocable delivery instruction to effect a book-entry settlement of the New Unicom Shares on a delivery versus payment (“DVP”) basis in accordance with the General Rules and Operational Procedures of CCASS to the credit of the stock account of the designated CCASS participant of the Buyer whose details have been notified by the Buyer to the Sellers in writing at least one Business Day prior to the Completion Date, and shall procure delivery of a certified true copy of the aforesaid irrevocable delivery instruction of the New Unicom Shares to the broker designated by the Buyer;

-6-

	4.2.2		in respect of the New Unicom ADSs, their designated DTC participant gives an irrevocable delivery instruction to effect a book-entry settlement of the New Unicom ADSs on a DVP basis in accordance with the rules and operational procedures of DTC to the credit of the stock account of the designated DTC participant of the Buyer whose details have been notified by the Buyer to the Sellers in writing at least one Business Day prior to the Completion Date, and shall procure delivery of a certified true copy of the aforesaid irrevocable delivery instruction of the New Unicom ADSs to the broker designated by the Buyer; and

	4.2.3		all the stamp duty payable in respect of the New Unicom Shares is duly paid and shall procure delivery of a certificate issued by the Sellers’ Broker, certifying that the total amount of stamp duty payable in respect of the New Unicom Shares has been duly paid, to the broker designated by the Buyer.

4.3

Subject to Clause 4.4, at Closing, the Buyer shall pay (or shall procure payment):

	4.3.1		to the Sellers such portion of the Purchase Price relates to the New Unicom Shares by procuring that the Buyer’s designated CCASS participant gives an irrevocable payment instruction to effect a book-entry settlement of the New Unicom Shares on a DVP basis in accordance with the General Rules and Operational Procedures of CCASS to such bank account of the Sellers’ designated CCASS participant whose details have been notified by the Sellers to the Buyer in writing at least one Business Day prior to the Completion Date;

	4.3.2		to the Sellers such portion of the Purchase Price relates to the New Unicom ADSs by procuring that the Buyer’s designated DTC participant gives an irrevocable payment instruction to effect a book-entry settlement of the New Unicom ADSs on a DVP basis in accordance with the rules and operational procedures of DTC to such bank account of the Sellers’ designated DTC participant whose details have been notified by the Sellers to the Buyer in writing at least one Business Day prior to the Completion Date.

4.4		Neither Party is obliged to complete the Acquisition unless the other Party has complied with all its obligations under this Clause 4.

4.5		If Closing does not take place on the Closing Date because a Party fails to comply with any of its obligations under this Clause 4 (whether such failure by the Party amounts to a material breach or not), the other Party may by notice to the first-mentioned Party:

	4.5.1		proceed to Closing to the extent reasonably practicable;

	4.5.2		postpone Closing to a date to be agreed by the Parties; or

	4.5.3		terminate this Agreement.

For the avoidance of doubt, if Closing does not take place on the Closing Date because both Parties fail to comply with any of their respective obligations under this Clause 4 (whether such failure by the Party or Parties amounts to a material breach or not), the Parties shall consult with each other in good faith with a view to postponing Closing to a

-7-

date not later than December 31, 2008 or terminating this Agreement, the decision in respect of which shall be in each Party’s absolute discretion.

4.6		If the Parties postpone Closing to another date in accordance with Clause 4.5, the provisions of this Agreement apply as if that other date is the Closing Date.

5.		REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS

5.1		Each of the Sellers represents and warrants to the Buyer that each Seller Warranty is true, accurate and not misleading at the date of this Agreement. Immediately before Closing, each of the Sellers is deemed to warrant to the Buyer that each Seller Warranty is true, accurate and not misleading by reference to the facts and circumstances on each day before Closing, and for this purpose only any references in the Seller Warranties to the date of this Agreement shall be construed as references to the relevant date. Unless otherwise set out in this Agreement, no other warranty is given by the Sellers.

5.2		Each of the Sellers acknowledges that the Buyer is entering into this Agreement in reliance on each Seller Warranty which has also been given as a representation and with the intention of inducing the Buyer to enter into this Agreement. The Sellers shall not invoke the Buyer’s constructive or imputed knowledge of a fact or circumstance which might make a Seller Warranty untrue, inaccurate or misleading as a defence to a claim for breach of Clause 5.1.

5.3		Each Seller Warranty is to be construed independently and (except where this Agreement provides otherwise) is not limited by a provision of this Agreement or another Warranty.

5.4		Each of the Sellers represents and warrants to the Buyer that:

	5.4.1		each of the Sellers is an entity duly organized and validly existing under the laws of its country of origin;

	5.4.2		each of the Sellers has the legal right, full power and authority, and has taken all action necessary, to execute, deliver and to exercise its rights, and perform its obligations, under this Agreement and any other documents to be executed by each of the Sellers pursuant to or in connection with this Agreement, which when executed will constitute valid and binding obligations on each Seller and its asset management clients for whose account the Sale Shares are managed and who are the beneficial owners;

	5.4.3		the Sale Shares are beneficially owned by the Sellers’ asset management clients in managed accounts over which the Sellers have investment discretion. To the best of the Sellers’ knowledge, there is no other person who has any legal or beneficial interest in the Sale Shares;

	5.4.4		each of the Sellers is validly appointed as discretionary investment manager by the beneficial owners in respect of the Sale Shares;

	5.4.5		the Sale Shares are beneficially owned by the Sellers’ asset management clients; to the best of the Sellers’ knowledge, the beneficial owners of the Sale Shares have the full legal right to sell the Sale Shares and which are free from any Encumbrances;

-8-

	5.4.6		upon completion of the Scheme, the Sellers’ asset management clients will be the sole beneficial owners of the New Unicom Shares and the New Unicom ADSs;

	5.4.7		each of the Sellers has not created or permitted the creation of any Encumbrance nor entered into any agreement, arrangement or obligation to create or give an Encumbrance, in relation to any of the Sale Shares, the New Unicom Shares and/or the New Unicom ADSs, and to the best of the Sellers’ knowledge, no person has claimed to be entitled to an Encumbrance in relation to any of the Sale Shares, the New Unicom Shares and/or the New Unicom ADSs;

	5.4.8		to the extent it held proxy voting authority, each of the Sellers has tendered votes in respect of the Shares underlying the Sale Netcom ADSs in favour of the resolution approving the scheme of arrangement under section 166 of the Companies Ordinance (Cap 32 of the Laws of Hong Kong) between the Company and the shareholders of the Company at the extraordinary general meeting of the Company to be held on 17 September 2008, and any adjournment thereof;

	5.4.9		the execution and delivery of, and the performance by each of the Sellers of its obligations under, this Agreement and any other documents to be executed by it pursuant to or in connection with this Agreement will not:

	(a)		result in a breach of any provision of the constitutional or organisational documents of each of the Sellers;

	(b)		result in a breach of or give any third party a right to terminate or modify, or result in the creation of any Encumbrance under, any agreement, licence or other instrument or result in a breach of any order, judgment or decree of any court, governmental agency or regulatory body to which each of the Sellers or its nominee is a party or by which any of the Sellers or its nominee or any of their respective assets is bound; or

	(c)		result in any breach of any contractual covenants or investment management agreement to which each of the Sellers is subject;

	5.4.10		each of the Sellers is not a “connected fund manager” (as defined in the Takeovers Code) or a “connected principal trader” (as defined in the Takeovers Code) of the offeror (i.e. Unicom) or the offeree company (i.e. the Company) nor a party acting in concert with the offeror and that consent from the Executive Director of the Corporate Finance Division of the Securities & Futures Commission is not required for the sale of the Sale Shares;

	5.4.11		each of the Sellers is not required to obtain any other person’s consent in relation to the sale of the Sale Shares, the New Unicom Shares and the New Unicom ADSs;

-9-

	5.4.12		each of the Sellers is not a connected person (as such term is defined in the Rules Governing the Listing of Securities on The Hong Kong Stock Exchange Limited) of the Company or Unicom;

	5.4.13		no petition has been presented or order made and no meeting convened or resolution passed for the winding up or administration of any of the Sellers or for a provisional liquidator to be appointed in respect of any of the Sellers;

	5.4.14		no distress, execution or other process has been levied on any of the assets of any of the Sellers, and no judgment creditor nor any liquidator, provisional liquidator, receiver or an administrative receiver of any of the Sellers has been appointed and there is no reason to believe that such a person might be appointed;

	5.4.15		no voluntary arrangement has been proposed in respect of any of the Sellers and their creditors; and

	5.4.16		each of the Sellers is not insolvent, or unable to pay its debts, and has not stopped paying its debts as they fall due, and no event analogous to any of the foregoing has occurred in or outside Hong Kong.

5.5		The Buyer represents and warrants to the Sellers that each Buyer Warranty is true, accurate and not misleading at the date of this Agreement. Immediately before Closing, the Buyer is deemed to warrant to the Sellers that each Buyer Warranty is true, accurate and not misleading by reference to the facts and circumstances on each day before Closing, and for this purpose only, any references in the Buyer Warranties to the date of this Agreement shall be construed as references to the relevant date. Unless otherwise set out in this Agreement, no other warranty is given by the Buyer.

5.6		The Buyer acknowledges that each of the Sellers is entering into this Agreement in reliance on each Buyer Warranty which has also been given as a representation and with the intention of inducing the Sellers to enter into this Agreement. The Buyer shall not invoke the Sellers’ constructive or imputed knowledge of a fact or circumstance which might make a Buyer Warranty untrue, inaccurate or misleading as a defence to a claim for breach of Clause 5.5.

5.7		The Buyer represents and warrants to the Sellers that:

	5.7.1		the Buyer is a corporation duly organized and validly existing under the laws of its country of origin;

	5.7.2		the Buyer has the legal right, full power and authority, and has taken all action necessary, to execute, deliver and to exercise its rights, and perform its obligations, under this Agreement and any other documents to be executed by the Buyer pursuant to or in connection with this Agreement, which when executed will constitute valid and binding obligations on the Buyer;

	5.7.3		the execution and delivery of, and the performance by the Buyer of its obligations under, this Agreement and any other documents to be executed by it pursuant to or in connection with this Agreement will not:

-10-

	(a)		result in a breach of any provision of the constitutional or organisational documents of the Buyer; or

	(b)		result in a breach of or give any third party a right to terminate or modify, or result in the creation of any Encumbrance under, any agreement, licence or other instrument or result in a breach of any order, judgment or decree of any court, governmental agency or regulatory body to which the Buyer or its nominee is a party or by which any of the Buyer or its nominee or any of their respective assets is bound;

	5.7.4		the Buyer is not required to obtain any other person’s consent in relation to the acquisition of the Sale Shares;

	5.7.5		no petition has been presented or order made and no meeting convened or resolution passed for the winding up or administration of the Buyer or for a provisional liquidator to be appointed in respect of the Buyer;

	5.7.6		no distress, execution or other process has been levied on any of the assets of the Buyer, and no judgment creditor nor any liquidator, provisional liquidator, receiver or an administrative receiver of the Buyer has been appointed and there is no reason to believe that such a person might be appointed;

	5.7.7		no voluntary arrangement has been proposed in respect of the Buyer and its creditors; and

	5.7.8		the Buyer is not insolvent, or unable to pay its debts, and has not stopped paying its debts as they fall due, and no event analogous to any of the foregoing has occurred in or outside Hong Kong.

5.8		Each of the Sellers undertakes to the Buyer that it shall not dispose of or enter into any agreement or arrangement to dispose of or permit the disposal of any of the Sale Shares, the disposal of which is subject to its discretion from the date of this Agreement and until the Long Stop Date or the date when this Agreement is terminated in accordance with Clause 3.3, whichever is earlier.

5.9		Each of the Sellers further undertakes to the Buyer that it shall exercise or procure to be exercised all the voting rights attaching to the Sale Listed Shares in favour of the resolution approving the Scheme and the Share Proposal at the shareholders’ meeting of the Company to be held on 17 September 2008, and any adjournment thereof.

6.		TERMINATION

6.1		If, at any time before Closing:

	6.1.1		there is a breach of any of the warranties of a Party set out in Clause 5.4 or 5.7, or any event occurs which would constitute a breach of such warranties; or

	6.1.2		a Party is in breach of any provision of this Agreement,

the other Party may by written notice to the Party that has committed a breach (the “Defaulting Party”) elect to proceed to Closing or terminate this Agreement.

-11-

		For the avoidance of doubt, if, upon the occurrence of any event set out in Clause 6.1.1 or 6.1.2, the non-defaulting Party elects to proceed to Closing, the non-defaulting Party shall be entitled to make a Relevant Claim against the Defaulting Party for such breach of warranties or breach of provisions of this Agreement.

6.2		Each of the Parties undertakes to notify the other Party in writing immediately if it becomes aware of a matter, breach, event, fact or circumstance that may give rise to a right of termination under Clause 6.1.

6.3		Each Party’s further rights and obligations cease immediately on termination, except that Clauses 7, 8, 9, 13, 14 and 15 shall survive termination of this Agreement and shall continue in full force and effect. Termination does not affect a Party’s accrued rights and obligations at the date of termination.

7.		INDEMNITIES

7.1		Each Party shall indemnify the other Party and keep the other Party indemnified, on demand against each loss, liability and cost suffered or incurred directly by the other Party as a result of or which arises out of or in connection with any of the following matters:

	7.1.1		any breach of any of the warranties set out in Clause 5.4 by the Sellers or Clause 5.7 by the Buyer, as the case may be; and

	7.1.2		any breach of any undertaking or provision contained in this Agreement by the first-mentioned Party.

7.2

Each Party shall indemnify the other Party, and keep the other Party indemnified, on demand against each loss, liability and cost which the other Party incurs directly arising out of:

	7.2.1		the settlement of a Relevant Claim against the first-mentioned Party or the enforcement of a settlement, provided that any such settlement has previously been approved in writing by the indemnifying Party; and

	7.2.2		legal proceedings against the first-mentioned Party in respect of a Relevant Claim in which judgment is given for the other Party or the enforcement of the judgment.

7.3		The total liability of each Party under the indemnity obligation provided in this Clause 7 shall not exceed the amount of the Purchase Price for all the Sale Shares.

8.		ACKNOWLEDGEMENTS

8.1		Each of the Sellers agrees and acknowledges that at the time of the execution of this Agreement and as at Closing, each of the Sellers is aware that the Buyer is a person connected with the Company (within the meaning of the SFO) and is or may be in possession of relevant information (as defined in Parts XIII and XIV of the SFO) relating to the Company and/or Unicom by virtue of it having two representatives on the board of directors of the Company and a representative on the Strategic Committee of the Company. Each of the Sellers further confirms that it has not received from the Buyer

-12-

(during the negotiations of the transaction contemplated by this Agreement or otherwise) or any other person, any such relevant information in relation to the Company or Unicom.

8.2		Each of the Sellers and the Buyer is not and will not, at any time be, engaged in insider dealing for the purposes of the SFO in connection with the Acquisition and the related transactions entered into or to be entered into pursuant to this Agreement; none of the Sellers, the Buyer, any of their respective Affiliates and any person acting on its or their behalf or under its or their control has taken or will take, directly or indirectly, any action designed or which was designed, or which constitutes or has constituted or might reasonably be or have been expected to cause or result in, stabilisation or manipulation of the price of any Shares or other securities of the Company or Unicom.

9.		COSTS AND TAXES

		All the stamp duty payable in connection with the Acquisition under this Agreement shall be borne by the relevant asset management clients of the Sellers. All the brokerage fees payable to the Sellers’ Broker and the Buyer’s designated broker in relation to the execution of the Acquisition contemplated herein shall be borne by the Parties in equal share. Except as otherwise provided in this Agreement, each Party shall be responsible for its own Tax liabilities and other costs arising from the Acquisition contemplated in this Agreement.

10.		FURTHER ASSURANCE

		A Party shall, on reasonable request from the other Party, do and execute or cause to be done and executed all such further acts, deeds, things and documents as may be necessary to give effect to the terms of this Agreement.

11.		ENTIRE AGREEMENT

		This Agreement constitutes the entire agreement and supersedes any previous agreements between the Parties relating to the subject matter of this Agreement.

12.		GENERAL

12.1		Subject to and without prejudice to the Buyer’s rights under Clause 6.1, the Buyer shall not be entitled to rescind this Agreement in any circumstances whatsoever (whether before or after Closing). This shall not exclude any liability for (or remedy in respect of) fraudulent misrepresentation.

12.2		A Party may make such filing regarding the Acquisition as required by the applicable laws and rules from time to time.

12.3		The invalidity, illegality or unenforceability of any provision of this Agreement shall not affect the continuation in force of the remainder of this Agreement.

12.4		Each Party may not, without the prior written consent of the other Party, assign, transfer, declare a trust for the benefit of or in any other way alienate any of its obligations or rights under this Agreement whether in whole or in part except that the Buyer may assign or transfer any of its obligations or rights under this Agreement to an Affiliate controlled

-13-

by the Buyer without the Sellers’ consent provided always that the Buyer shall remain fully liable for all obligations, covenants and undertakings set out herein following such assignment.

12.5		No variation of this Agreement shall be effective unless in writing and signed by or on behalf of each Party.

13.		NOTICES

13.1		Any notice, claim, demand or other communication under or in connection with this Agreement (a “Notice”) shall be in writing in English and shall be delivered or sent to the parties as follows:

(a)

in the case of the Sellers:


Address:		1345 Avenue of the Americas
		New York NY 10105
		USA
Fax Number:		+212-969-2293
Attention:		General Counsel

(b)

in the case of the Buyer:


Address:		Distrito C, Edificio Oeste 3
		Ronda de la Comunicación s/n
		28050 Madrid
		SPAIN
Fax Number:		+ 34 91 483 61 84
Attention:		General Counsel

		or to such other address or fax number as the relevant Party may have notified to the other in accordance with this Clause 13.

13.2		A Notice shall be deemed to have been given and received: (i) on the fifth (5th) Business Day following the date of mail posting if properly addressed and postage paid, or (ii) on the next following Business Date following the date of delivery, if delivered by courier, or (iii) on the next Business Day if delivered by fax with issuance by the transmitting machine of a written confirmation that the number of pages constituting the notice have been transmitted without error followed by mail posting within the next Business Day.

14.		ARBITRATION

14.1		Any dispute arising out of or in connection with this Agreement (a “Dispute”) shall be referred to and finally resolved by arbitration at the Hong Kong International Arbitration Centre (“HKIAC”) in accordance with the UNCITRAL Arbitration Rules as at present in force, which rules are deemed to be incorporated by reference into this Clause 14 and as may be amended by the rest of this Clause 14. Any such arbitration shall be held in Hong Kong and administered by the HKIAC in accordance with HKIAC Procedures for Arbitration in force as at the date of this Agreement including such additions to the UNCITRAL Arbitration Rules as are therein contained.

-14-

14.2		There shall be one arbitrator who shall be jointly appointed by the Parties and failing agreement, the arbitrator shall be appointed by the HKIAC. The appointing authority shall be the HKIAC. The language to be used in the arbitral proceedings shall be English. The award rendered by the arbitrator shall be final and binding upon the Parties and enforceable through entry in any court of competent jurisdiction. The prevailing Party shall be entitled to recover from the other Party such attorneys’ fees, arbitrators’ fees and other arbitration costs and expenses as it has reasonably incurred.

15.		GOVERNING LAW

		This Agreement shall be governed by and construed in accordance with the laws of Hong Kong.

16.		COUNTERPARTS

		This Agreement may be executed in any number of counterparts, each of which when executed and delivered is an original and all of which together evidence the same agreement.

-15-

SCHEDULE 1

Names of the Sellers

AllianceBernstein Limited, an Affiliate of AB

AllianceBernstein Hong Kong Limited, an Affiliate of AB

AllianceBernstein Japan Ltd, an Affiliate of AB

AllianceBernstein Investment Management Australia Limited, an Affiliate of AB

AllianceBernstein Australia Limited, an Affiliate of AB

AllianceBernstein New Zealand Limited, an Affiliate of AB

AllianceBernstein (Singapore) Ltd, an Affiliate of AB

-16-

EXECUTED by the Parties on the date first written above.

SIGNED by

ALLIANCEBERNSTEIN L.P.
By Its General Partner,
ALLIANCEBERNSTEIN CORPORATION

Laurence E. Cranch
Executive Vice President, General Counsel
& Corporate Secretary

SIGNED by

for and on behalf of
Telefónica Internacional, S.A.U.
in the presence of:

Signature Page

Annex

Indicative purchase price of each Unicom Share

(for illustration purpose only)

Based on an exchange ratio of 1 Sale Listed Share shall be entitled to receive 1.508 New Unicom Shares and 1 Sale Netcom ADS shall be entitled to receive 3.016 New Unicom ADSs as set out in the Scheme Document and subject to adjustment at Closing as provided in Clause 2.3, the purchase price for each New Unicom Share and each Unicom Share underlying the New Unicom ADSs shall be as follows:


	Purchase price for each	Purchase price for each
Assumption	New Unicom Share	New Unicom ADS
Assuming the Average Closing Price (as defined in Clause 2.2) is HK$22.21 or below	HK$14.7281	HK$147.281
Assuming the Average Closing Price is HK$24.55 or higher	HK$16.2798	HK$162.798

EX-99.2 3 y72073exv99w2.htm EX-99.2: IRREVOCABLE UNDERTAKING EX-99.2

Exhibit 2

IRREVOCABLE UNDERTAKING

To:    China Unicom Limited
          75th Floor, The Center
          99 Queen’s Road Central
           Hong Kong

June 1, 2008

Dear Sirs

Proposed Merger of China Unicom Limited and China Netcom Group Corporation (Hong Kong) Limited

We understand that China Unicom Limited (Unicom) is proposing a merger with China Netcom Group Corporation (Hong Kong) Limited
(Netcom) which would be implemented by way of a scheme of arrangement by Netcom under Section 166 of the Hong Kong Companies Ordinance pursuant to which all of the issued Netcom shares (including the Netcom shares underlying the Netcom American Depositary Shares) will be cancelled, on the terms and subject to the conditions as set out in the announcement of the Scheme attached as the Appendix to this letter (the Announcement).

This letter sets out the terms and conditions on which we will vote in favour of the Scheme.

Shareholdings

1. Telefonica Internacional, S.A.U. (the Covenantor) represents and warrants to Unicom that:

(a)		it is the legal and beneficial owner of 333,971,305 Netcom shares, representing approximately 5% of the issued share capital of Netcom (the *Relevant Shares* );

(b)		the Relevant Shares and any Further Relevant Shares (as defined in paragraph 2(a) below) are held free of any lien, charge, option, claim, equity, right of pre-emption and any other third party right or encumbrance of any nature whatsoever and together with all rights accruing or attaching thereto, including, without limitation, the right to receive in full dividends and other distributions declared, made or paid, if any, on or after the date of the Announcement; and

(c)		it has full power and authority to enter into this letter, to perform the obligations set out in this letter, and to vote the Relevant Shares and any Further Relevant Shares in favour of the Scheme.

Dealings

2. The Covenantor undertakes to Unicom that before the Scheme becomes effective, lapses or is withdrawn or until this letter lapses in accordance with its terms, it shall not:

(a)

other than pursuant to the Scheme, sell, transfer, charge, encumber, grant any option over or otherwise dispose of any interest in (i) any Relevant Shares or (ii) any other

		shares or securities in Netcom issued or unconditionally allotted to it or otherwise acquired by it (the *Further Relevant Shares*);

(b)		accept, or procure the acceptance of, any other offer in respect of the shares or securities referred to in paragraph 2(a) above, except as provided in paragraph 10(e) below;

(c)		vote as a shareholder of Netcom in favour of any resolution which might result in any condition of the Scheme not being fulfilled;

(d)		other than pursuant to the Scheme, enter into any agreement or arrangement or permit any agreement or arrangement to be entered into or authorise or incur any obligation or permit any obligation to arise:

	(i)		to do any of the acts referred to in paragraphs 2(a) to 2(c) above; or

	(ii)		which, in relation to the Relevant Shares or any Further Relevant Shares, would or might restrict or impede the Covenantor voting in favour of the Scheme,

and, for the avoidance of doubt, references in this paragraph 2(d) to any agreement, arrangement, authorisation or obligation includes any agreement, arrangement, authorisation or obligation whether or not subject to any condition;

(e)		sell or otherwise dispose of any shares or other securities of Unicom or any interest therein (including any derivatives referenced to such securities); or

(f)		requisition or join in requisitioning any general or class meeting of Netcom without the prior consent of Unicom.

3. The Covenantor undertakes that it shall not directly or indirectly solicit or encourage any person other than Unicom to make any offer for any shares or other securities of Netcom or take any action which may be prejudicial to the successful outcome of the Scheme or which would or might have the effect of preventing any of the conditions of the Scheme from being fulfilled.

Undertaking to Vote in Favour of the Scheme

4. In consideration of Unicom’s agreement in paragraph 9 to make the Proposals (as defined in the Announcement) and assist in the preparation of the formal document setting out the terms and conditions of the Scheme (the Scheme Document), the Covenantor undertakes that it shall exercise all voting rights attaching to the Relevant Shares and any Further Relevant Shares to vote in favour of all resolutions to approve the Scheme and any related matters necessary to implement the Scheme proposed at any general or class meeting (the EGM) and the Court convened meeting (the Court Meeting) of Netcom to be convened and held in connection with the Scheme, or at any adjournment of any such meeting. In the event that the representative appointed by the Covenantor cannot attend and vote at the EGM or the Court Meeting, this letter shall be deemed to authorize the chairman of the EGM or the Court Meeting, as the case may be, as the proxy or representative of the Covenantor to attend and vote at the EGM or Court Meeting in respect of the resolutions to approve the Scheme, and any related matters necessary to implement the Scheme.

Page 2

Documentation

5. We consent to:

(a)		the inclusion of references to the Covenantor and this letter in the Announcement substantially in the terms set out in the Announcement;

(b)		a copy of this letter being filed as an exhibit to any of Unicom’s filings with, or submissions to, the United States Securities and Exchange Commission (the *US SEC*), if and to the extent required. In the event that a copy of this letter is required to be filed by Unicom with any other regulatory body, Unicom shall obtain the Covenantor’s prior consent, such consent shall not be unreasonably withheld or delayed;

(c)		references to the Covenantor, particulars of this letter substantially in the terms set out in the Announcement and our interests in the Relevant Shares and any Further Relevant Shares as required by the Hong Kong Code on Takeovers and Mergers (the *Code*) to be included in any announcement of the Scheme, the Scheme Document and any other related or ancillary document; and

(d)		this letter being available for inspection as required by the Code or the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the *Hong Kong Stock Exchange*).

6. We shall endeavour to promptly give you all information and any assistance as you may reasonably require for the preparation of the Scheme Document and all related and ancillary announcements and documents in order to comply with the requirements of the Code, the Securities and Futures Commission of Hong Kong (the SFC), the Hong Kong Stock Exchange, the US SEC and any other legal or regulatory requirement or body. We shall, promptly after the same comes to our attention, notify you in writing of any material change in the accuracy or impact of any information previously given to you.

Interpretation

7. In this letter, the Scheme means a scheme of arrangement under Section 166 of the Hong Kong Companies Ordinance by Netcom involving the cancellation of all the issued Netcom shares (including the shares underlying the Netcom American Depositary Shares) on the terms and subject to the conditions set out in the Announcement and the Scheme Document or such other terms as may be required to comply with the requirements of the SFC or the Hong Kong Stock Exchange provided that such other terms do not constitute material changes to the terms of the Scheme as set out in the Announcement.

Time of the Essence

8. Any time, date or period mentioned in this letter may be extended by mutual agreement but as regards any time, date or period originally fixed or as extended, time shall be of the essence. References to times of the day are to time in the Hong Kong Special Administrative Region of the People’s Republic of China (Hong Kong).

The Scheme

9. Subject to paragraph 10 , Unicom agrees to make the Proposals and assist Netcom in the preparation of the Scheme Document, provided the Announcement of the Scheme is released substantially in the form attached as the Appendix to this letter (except for such

Page 3

changes required to comply with the requirements of the SFC or the Hong Kong Stock Exchange and provided that such changes are not material) by not later than June 30, 2008.

10. Notwithstanding any other provisions in this letter, this letter shall lapse and each party shall have no obligations hereunder upon the earlier to occur of the following:

(a)		if the Announcement is not released by June 30, 2008; or

(b)		if Unicom announces, with the consent of the SFC and before the Scheme Document is posted, that it does not intend to proceed with the Scheme; or

(c)		if the Scheme is not approved at the EGM or the Court Meeting by November 30, 2008; or

(d)		if the Scheme lapses or is withdrawn in accordance with its terms; or

(e)		in the event of a higher competing offer for Netcom; or

(f)		if since the date of this letter, there has been a material adverse change in the business, financial or trading position of Unicom; or

(g)		in the event that the independent financial adviser appointed by the Independenet Board Committee of Netcom does not render an opinion that the Proposals are fair and reasonable.

If this letter lapses, the Covenantor shall not have any claim against Unicom and Unicom shall not have any claim against the Covenantor pursuant to this letter.

Specific Performance

11. The Covenantor agrees that if it fails to comply with the undertakings in paragraphs 2 and 4 , damages would not be an adequate remedy and accordingly, Unicom shall be entitled to the remedy of specific performance, injunction or other equitable relief.

potential share acquisition

12. Nothing in this letter shall be construed so as to prevent or restrict the Covnenator or any of its affiliates from acquiring any shares or securities in Netcom or Unicom, provided that such acquisition(s) will be done in accordance with the relevant provisions of the Code and the applicable laws. It is agreed that the Covenantor is not acting in concert with Unicom or persons acting in concert with it by acquiring such shares or securities.

Governing Law and Jurisdiction

13. The terms of this letter shall be governed by and construed in accordance with the laws of the Hong Kong and the parties submit to the exclusive jurisdiction of the Hong Kong courts for all purposes in connection with this letter.

Counterparts

14. This letter may be executed in any number of counterparts and by the parties to it on separate counterparts, each of which is an original but all of which together constitute one and the same instrument.

Page 4

Please acknowledge your agreement to the above by signing and returning to us a copy of this letter on the date hereof.


Yours faithfully For and on behalf of Telefonica Internacional, S.A.U.
/s/ José Mariá Álvarez-Pallete
Name:	Mr José María Álvarez-Pallete
Title:	President and Chief Executive Officer

We hereby confirm our agreement to the above.


For and on behalf of China Unicom Limited
/s/ Chang Xiaobing
Name:	Chang Xiaobing
Title:	Chairman and Chief Executive Officer

Page 5

EX-99.3 4 y72073exv99w3.htm EX-99.3: JOINT FILING AGREEMENT EX-99.3

Exhibit 3

Joint Filing Agreement

In accordance with Rule 13d-1(k) under the Securities Exchange Act of 1934, as amended, each of the persons named below agrees to the joint filing of a statement on Schedule 13D (including amendments thereto) with respect to the ordinary shares, par value HK$0.10 per share, of China Unicom (Hong Kong) Limited, a corporation organized under the laws of Hong Kong, and further agrees that this Joint Filing Agreement be included as an exhibit to such filings, provided that, as contemplated by Section 13d-1(k)(1)(ii), no person shall be responsible for the completeness or accuracy of the information concerning the other persons making the filing, unless such person knows or has reason to believe that such information is inaccurate. This Joint Filing Agreement may be executed in any number of counterparts, all of which taken together shall constitute one and the same instrument.

Dated: October 24, 2008


	TELEFÓNICA, S.A.
By:	/s/ María Luz Medrano Aranguren
	Name:	María Luz Medrano Aranguren
	Title:	Group General Vice Counsel


	TELEFÓNICA INTERNACIONAL, S.A.U.
By:	/s/ Juan Carlos Ros Brugueras
	Name:	Juan Carlos Ros Brugueras
	Title:	Attorney

GRAPHIC 5 y72073y7118801.gif GRAPHIC begin 644 y72073y7118801.gif M1TE&.#EAL@`H`-4@`&]O;^_O[_O[^[Z^OCL[.YN;F]K:V@\/#_W]_?GY^?;V M]BTM+?___QX>'N;FYJ6EI;>WMU965F-C8\;&QH:&AI&1D?[^_O+R\JZNKN#@ MX,W-S4E)2>KJZGM[>]34U````/___P`````````````````````````````` M```````````````````````````````````````````````````````````` M`````````````````````````````````"'Y!`$``"``+`````"R`"@```;_ M0!#D\"E^%@J0>@T"BA@&G`1>!806HJ7(,9Q`@"!M%#Y4?=Q84106Y`P$3#:1%#7T.`P.J?F.B M58.E1A#*`Y!R81+5UG(.QDO>1[D92@5%`[D&2N%*10#/T'OP2E:7TFX!JWKY M:P;NA='(2.IB(9V2,.T^1%B2X-0U,J'FU7NFR`B_-16+7/R2H=/G@P M"*("J0Y%%D"@.]#6(Q@X0FH*P9#H+9*-!2A0)(+8R4((-@Z0.%3(`5:,W-= M@SGK,P1:$<`#G54T/`N2/QP`<"<0AJR6`V3]M>9UY@?,YNG>S;NW[]_`@PL? M3KRX\>/(DRM?SKRY\^?0HTN?3KVZ]>O8LVO?SKV[]^_@PXL?3[Z\^?/HTZM? MS[Z]^_?PX\N?3Q\\@P`:#%A=8P%5E5,G873*?@(&H,9]K^B4#`<%!=*0*Z?D M5IT!Q!@!0(-7D0)"8(&4M?^`*`,8D408B'QA05HBR;2&.6Z4*%U';A`UDST; MCB4'`F=\8)D<(2ZFA3-K2*#'9EFP>,AU216`@`%G;(1%1""<\1<5BAW0206$ M]%B$`R3*`6,##B"0EHQDL(B!*Q).9TP?&2BCQA=61/```!A$8.,:=LJI&H9D M]`A5!`@`^459LX!@035RL/B`*Z95]P\\];@QI10A?5"`8DH%TJ,9NA#A(A4P MK?6,D5P0*=U0-1TA)``53MK$`RGY]`&9?9X#U0.V?#H%3*8F.N1U(IE&QUUP MHJH$8:XNP4"%$@!P!H%8](A!I8(6Z0M(1@2(!8O$9F>G0@,8^686?-7HUQHP MNE%F:*V6!H6&'!P8\<``W[ZSHCN9V5O=!15R@,O M""2EZQ0(<]%`FMM:@ET"*"ZPE!R=Z1L:&0Q\#$+(68V+A0%9W84R`%@R0M@' 1'4"+Q03Y:E7?S3CG7%\0`#L_ ` end GRAPHIC 6 y72073y7118802.gif GRAPHIC begin 644 y72073y7118802.gif M1TE&.#EA-P`4`,05`%]?7^_O[Y^?G]_?WR\O+Q\?'\_/SP\/#X^/CV!@8&]O M;Z^OKT]/3T!`0'!P<']_?[^_OX"`@#\_/P```/_______P`````````````` M`````````````````````````"'Y!`$``!4`+``````W`!0```7_8"6.9&F> M:*J*E$&5`14,\%L9`1G$.#G,D*!A%*,87Y$(8)*,O"@$"(.A$(@"$H@Q:QM( M#)$"P%H9$!8"R4&BJ+0(!H6$[7[8']J75U(@$`I#"WT0$X42;@@+$`]B!#1* M!5M&;F,#1T<3=@`1+`E9=P)/$@(""00(AQ4!48P`CA60$`4'!)PW!PZ%A1`1 M]C, M48:GFTDZ?XYP,8*"EC(V5BA=RK2ITZ=0HTJ=2K6JU:M8LVK=RK6KUZ]@580` "`#L_ ` end -----END PRIVACY-ENHANCED MESSAGE-----

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents