BIDDING RULES AND CONDITIONS

SPECIAL PUBLIC AUCTION

JUNE 30, 2018

1. Prior to the start of the public auction, the bidder shall register his/her name and will be
required to present any valid government issued identification card, which will qualify him/her
to participate in the Bidding. He/She shall be given a bidder number.

2. The public auction shall be presided by an auctioneer. Auction starts when the auctioneer
announces the indicative price of a particular property.

3. The auctioneer shall progressively increase the bid price in the following increments for
others to challenge until such time as only one bidder with the highest bid among all other
bidders wins:

First five (5) increments - by P10,000.00

6th to 10th increments - by P20,000.00
Onwards - by P50,000.00

The auctioneer shall have the sole discretion to increase the increments at any amount in order
to facilitate the bidding process.

4. Upon the fall of the hammer, the auctioneer shall announce the identification number of the
bidder who submitted the highest bid and the amount of his/her bid. No other bids shall be
accepted after the fall of the hammer.

Please note that published prices for the properties are indicative, and will be subject to
evaluation by the Bank. Final determination of the highest bids shall be subject to approval of
Union Bank.

5. Immediately after the auction, the highest bidder shall be issued a provisional Award
Certificate which shall state the name of the highest bidder, the amount of the highest bid and
the description of the property.

The Award Certificate is not a document of sale. The award certificate merely certifies that the
person whose name is stated thereat is the highest bidder for the property described and for
the price indicated therein.

6. Upon issuance of the provisional Award Certificate, the highest bidder shall present said
Certificate to the Bank care of Asset Recovery Group—Sales Division which will prepare the
corresponding contract of sale based on the following Rules:

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 A) Rules for Cash Payment:

i) Highest bidder who opts to pay in cash the full highest Bid Price indicated in the
provisional Award Certificate shall be entitled to a 5% discount on the full highest Bid
Price.

ii) Payment terms for Cash Buyers:

a) Not later than five (5) working days from the Auction Date, an earnest money
computed at 10% of the gross highest bid price shall be paid by the highest
bidder to the Bank.

b) The balance of the purchase price, net of the 5% discount shall be paid not
later than forty-five (45) working days from the auction date.

Should the highest bidder fail to pay the balance of the purchase price above indicated within
45 working days period from the auction date, the earnest money paid by him/her for the
Property shall be forfeited in favor of the Bank without prior written notice.

B) Rules for Installment Payment:

i) The highest bidder shall pay 10% of the highest bid price as down payment for the sale
to him/her of the property. The down payment shall be payable in six (6) equal monthly
installments. The schedule of payment will be as follows:

a) The first installment will be paid within five (5) working days from the auction
date.

b) The second installment will be paid on the same date of the immediately
succeeding month after (a) above.

c) The third installment will be paid on the same date of the immediately
succeeding month after (b) above, and so on until the sixth (6 th) installment.

Should the highest bidder fail to pay the down payment based on the above schedule (refer to
a to c), or should he/she fail to continue with the sale or to execute the Contract to Sell, to
submit the required post-dated checks within ten (10) working days from full payment of the
earnest money, all payments made in favor of UnionBank shall be forfeited without prior
written notice.

ii) The balance of the Purchase Price shall be payable up to a maximum period of 15
years bearing an interest rate of 11% fixed for 15 years.

Upon execution of the sale document, the highest bidder shall be required to submit
five (5) post-dated checks to cover his/her 2nd to 6th installment payment for the

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 down payment and twenty (24) post-dated checks to cover his/her monthly
amortization for the first two (2) years including payments for the real estate tax and
insurance premium. This procedure shall continue until full payment of the Purchase
Price. The real estate tax for the first year shall be paid by the buyer upon his/her
execution of the contract to sell. Failure to comply with this requirement shall
constitute an event of default.

iii) Union Bank shall cause the existing improvement/s on the auctioned properties to be
insured against fire and lightning. The cost of the premium due shall be charged to the buyer.

7. Rights of the Next Qualified Bidder—In either case of cash or installment sales, the highest
bidder shall forfeit his/her right to purchase the auctioned property if he/she does not pay the
Earnest Money within five (5) working days from the auction date. The next qualified highest
bidder shall then be informed of the forfeiture of the highest bidder.

8. After compliance with all conditions of the sale and the bid price has been paid in full, a Deed
of Absolute Sale shall be issued in favor of the highest bidder.

9. The auctioned properties are sold on “as is where is” basis. As such, the SELLER makes no
warranty as to the boundaries, technical description of the property, and its legal condition
such as the existence of any claims, suits or actions involving the same. Among others, BUYERS
shall be responsible for the eviction of the occupants on the property, if any, or for the repair of
the property if needed. It shall be understood that the SELLER makes no warranty whatsoever
on the authenticity and accuracy of title over the property.

The herein prospective bidder certifies that he/she has made his/her own independent
verification/inspection of the title over the property and the physical and legal condition of the
property prior to the bidding.

10. UnionBank shall ensure that the payment of real estate taxes on the property being sold is
updated up to the date of the bidding. From the date of the purchase, the real estate taxes shall
be for the account of the buyer.

11. The documentary stamp tax, capital gains/creditable withholding tax, transfer tax, value
added tax, registration fees, insurance premium and all other applicable taxes and incidental
costs in relation to the sale of the property to the BUYERS shall be for the BUYERS’ account.

12. UnionBank reserves the right to reject any and all bids prior to the issuance of the
provisional Award Certificate to the highest bidder for whatever reason it may deem proper.

13. Prior to the auction date, UnionBank may at any time withdraw any of the properties
included in the list of real estate properties for public auction.

14. The highest bidder shall not be allowed to move into the premises of the property, build or
introduce any improvement thereon, make any renovations or alterations whatsoever, unless

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the down payment has been fully paid, the sales document duly executed, the 24 post-dated
checks and all documentary and other requirements duly submitted. Provided, however, that
upon his/her non-compliance with the said requirements, the highest bidder who has prior
possession of the property undertakes to voluntarily vacate the same and remove the
improvements he/she has introduced thereon at his expense and hereby irrevocably authorizes
the Bank to padlock, fence, close said property, cut off utilities thereto and take physical
possession thereof.

15. The BUYERS shall strictly comply with the schedule of payment either on cash or installment
basis. Non-compliance to the said payment schedule shall result in the forfeiture of all
payments made in favor of UnionBank without prior written notice.

16. In all cases, the BUYERS shall strictly follow the schedule of payment, terms and conditions
indicated in the provisional Award Certificate.

As a participant in the auction, I hereby confirm having read and fully understood the rules
and conditions of the auction and I agree to follow and be bound by them.

___________________________________
Buyer/s’ Signature Over Printed Name

___________________________________
Date

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