Dear Sir:

Thank you for meeting with me this past week. In this letter, I will provide you
with my legal opinion and analysis so you can make a qualified decision regarding the
charges you face. I will first restate the facts, as I know them, to confirm their
accuracy. Next, I will provide you with an explanation of the law as it applies in your
case.
As you've described it, your government has issued bond and plan to offer an
amendment to exchange the old bonds for new bonds. The majority bondholders who
are institutional investors are willing to this change while the minority bondholders
refuse to participate in this restructuring. In order to encourage the minority
bondholders to give up their old bonds, the government is planning to delete the tax
gross-up clause in the old bonds. So problems arouse that whether this action violates
any duties of good faith and fair dealing doctrine according to New York Contract
Law.
According to Van Gemert v. Boeing, the newspaper notice was inadequate, since
there should be a necessity to protect unsophisticated investors. Boeing could have
easily advertised in the press or provided details with proxy material. Compared to
Metropolitan Life Insurance Co. v. RJR Nabisco, plaintiffs were sophisticated parties
who contemplated the possibility of inserting a provision that would have protected
them from such a possibility, but they declined out of fear of losing the business.
Therefore, the buyout breached an implied covenant of good faith and fair dealing.
In accordance with the facts and analysis of the above cases, we can safely come
to the following conclusions. If the plaintiffs are sophisticated parties such as
institutional investors who contemplated the possibility of inserting a provision that
would have protected them from such a possibility, the implied covenant of good faith
and fair dealing will not be applied. If the plaintiffs are ordinary shareholders, then
they will be protected by the doctrine of good faith and fair dealing. In this case, the
minority shareholders are the latter one, so they will be protected by the implied
covenant of good faith and fair dealing. Therefore, we suggest the government of
Urbania no to cut the tax gross-up clause.
Please do not hesitate to call me with any questions you may have. Also, if there
are any misstatements of fact in this letter it is important that you contact me when
possible. Again, it was a pleasure meeting you and I look forward to your call.

Yours Sincerely,