Document:

Opinion of the Procuradora de la Administracion of the Republic of Panama

 EXHIBIT 4(4) 

 [Letterhead of Procuraduría de la Administración] 
  
 Panamá, 27 de octubre de 2004. 
  
 Dr. Ricaurte Vásquez Morales 
 Minister of Economy and Finance 
 of the Republic of Panama 
 P.O. Box 2694, Zona 3 
 Panama, Republic of Panama 
  
 Dear Minister Vásquez: 
  
 I am the Procuradora de la Administración of the Republic of Panama (the “Republic”) and have served as
counsel to the Republic in connection with the Republic’s Registration Statement (the “Registration Statement”), and the forms of the Underwriting Agreement and the Fiscal Agency Agreement incorporated as Exhibits 4(1) and 4(2)
thereto (the “Agreements”), pursuant to which the Republic is registering certain securities (the “Securities”) to be offered and sold from time to time as set forth in the Registration Statement. 
  
 The filing of this Registration Statement has been authorized pursuant to
Cabinet Decree No. 37, dated October 20, 2004 (the “Cabinet Decree”). 
  
 It is my opinion that when the Securities have been (i) duly authorized, issued, executed and delivered by the Republic and authenticated pursuant to the Cabinet Decree, and (ii) delivered and paid for as contemplated
by the Agreements and the Prospectus (including, without limitation, the applicable Prospectus Supplement and any amendment and supplement thereto), the Securities will constitute valid and legally binding obligations of the Republic under the laws
of the Republic. 
  
 I hereby consent to the filing of this
opinion as an exhibit to the Registration Statement and to the use of my name under the heading “Validity of the Securities” in the Registration Statement. In giving the foregoing consent, I do not thereby admit that I am 
 in the category of persons whose consent is required under Section 7 of the United States Securities Act of 1933, as amended, or the rules and regulations of the United
States Securities and Exchange Commission. 
  
  

			
	Very truly yours,
	
	 /s/    Alma Montenegro de Fletcher

	 Alma Montenegro de Fletcher
 Procuradora
General de la Administración
 of the Republic of PanamaOpinion of Arnold & Porter LLP.

 EXHIBIT 4(6) 

 [Letterhead of Arnold & Porter LLP] 
  
 October 29, 2004 
  
 Ministry of Economy and Finance 
      of the
Republic of Panama 
 P.O. Box 2694, Zona 3 
 Panama, Republic of
Panama 
  
 Dear Ladies and Gentlemen: 
  
 We have acted as special United States counsel to the Republic of Panama
(“Panama”) in connection with the preparation of the registration statement under Schedule B (the “Registration Statement”) filed on the date hereof with the Securities and Exchange Commission (the “Commission”) under
the Securities Act of 1933, as amended (the “Act”), pursuant to which Panama is registering $1,000,000,000 aggregate principal amount of its debt securities and warrants (the “Securities”) to be offered and sold from time to time
as set forth in the Registration Statement and the prospectus (the “Prospectus”) contained therein. We are familiar with (a) the form of Fiscal Agency Agreement (including the forms of Note), as amended by Amendment No. 1 dated as of
September 4, 2003, previously filed as part of Panama’s Registration Statement on Schedule B (Registration No. 333-8558) and made a part of the Registration Statement (the “Fiscal Agency Agreement”), and (b) the form of Underwriting
Agreement previously filed as part of Panama’s Registration Statement on Schedule B (Registration No. 333-8558) and made a part of the Registration Statement (together with the Fiscal Agency Agreement, the “Agreements”). 

 
 In rendering the opinion expressed below, we have examined such
certificates of public officials, government documents and records and other certificates and instruments furnished to us, and have made such other investigations, as we have deemed necessary in connection with the opinion set forth herein.
Furthermore, we have assumed the genuineness of all signatures, the authenticity of all documents submitted to us as originals, the authority of Panama to enter into the Agreements and cause the issuance of the Securities, and the conformity to
authentic originals of all documents submitted to us as copies. As to any document originally prepared in any language other than English and submitted to us in translation, we have assumed the accuracy of the English translation. 
  
 This opinion is limited to the federal laws of the United States and the laws
of the State of New York, and we do not express any opinion herein concerning the laws of any other jurisdiction. Insofar as the opinion set forth herein relates to matters of the laws of Panama, we have relied upon the opinion of Alma Montenegro de
Fletcher, Procuradora de la Administración of Panama, a copy of which is being filed as an exhibit to the Registration 

 Ministry of Economy and Finance 
 October 29, 2004 
 Page 2 
  
 Statement, and our opinion herein is subject to any and all exceptions and reservations set forth therein. 
  
 Based upon and subject to the foregoing, we are of the opinion that when the Securities have been duly authorized, issued,
and executed by Panama and authenticated, delivered, and paid for as contemplated by the Agreements, the Prospectus and any amendment and supplement thereto, the Securities will constitute valid and legally binding obligations of Panama under the
laws of the State of New York. 
  
 We hereby consent to the filing
of this opinion as an exhibit to the Registration Statement and to the references to this firm under the heading “Validity of the Securities” in the Registration Statement. In giving the foregoing consent, we do not thereby admit that we
are within the category of persons whose consent is required under Section 7 of the Act or the rules and regulations of the Commission thereunder. 
  

			
		
	 	 	 Very truly yours,
  
  
 /s/    Arnold & Porter LLPConsent of the Minister of Economy and Finance of the Republic of Panama

 EXHIBIT 4(8) 

 [Letterhead of Ministry of Economy and Finance] 
  
 October 29, 2004 
  
 CONSENT 
  
 I, Ricaurte Vásquez Morales, Minister of Economy and Finance of the Republic of Panama, hereby consent to the reference to my name, in my official
capacity, as the Minister of Economy and Finance under the caption “Official Statements” in the Prospectus included in this Registration Statement of the Republic of Panama filed with the United States Securities and Exchange Commission.

  

			
		
	 	 	 /s/ Ricaurte Vásquez Morales

	 	 	 Ricaurte Vásquez Morales
 Minister of Economy
and Finance
 of the Republic of PanamaForm of Sunterra Corporation Non-Statutory Stock Option Agreement

 Exhibit 10.1 
  
 SUNTERRA CORPORATION 
  
 NON-STATUTORY STOCK OPTION AGREEMENT 
  

					
	[Date of Grant]	  	[No. of Options Granted]	  	[Option Price]

  
 1. Grant of Option. Sunterra
Corporation, a Maryland corporation (the “Company”), hereby grants to [OPTIONEE] (the “Optionee”) an option, pursuant the Company’s 2002 Stock Option Plan (the “Plan”), to purchase an aggregate of [No. of Options
Granted] shares of Common Stock (“Common Stock”) of the Company at a price of $[            Option Price] per share, purchasable as set forth in and subject to the terms and
conditions of this option and the Plan. Except where the context otherwise requires, the term “Company” shall include the parent and all present and future subsidiaries of the Company as defined in Sections 424(e) and 424(f) of the
Internal Revenue Code of 1986, as amended or replaced from time to time (the “Code”). 
  
 2. Non-Statutory Stock Option. This option is not intended to qualify as an incentive stock option within the meaning of Section 422 of the Code. 
  
 3. Exercise of Option and Provisions for Termination. 
  
 (a) Vesting Schedule. Except as otherwise provided in this Agreement, this option may be exercised prior to the tenth anniversary of the
date of grant (hereinafter the “Expiration Date”) in installments as to not more than the number of shares set forth in the table below during the respective installment periods set forth in the table below. 
  
 VESTING SCHEDULE 
  
 [Vesting Period] 
 [Term in Months] 

[Number of shares vested per month] 
 [Date fully Vested] 
 [Expiration Date] 
  
 The right of exercise shall be cumulative so that if the option is not exercised to the maximum extent permissible during any exercise period, it shall be exercisable, in whole or in part, with respect to all shares
not so purchased at any time prior to the Expiration Date or the earlier termination of this option. This option may not be exercised at any time on or after the Expiration Date, except as otherwise provided in Section 3(e) below. 
  
 (b) Exercise Procedure. Subject to the conditions set forth in this Agreement, this option
shall be exercised by the Optionee’s delivery of written notice of exercise to the Secretary of the Company, specifying the number of shares to be purchased and the purchase price to be paid therefore and accompanied by payment in full in
accordance with Section 4. Such exercise shall be effective upon receipt by the Secretary of the Company of such written notice together with the required payment. The Optionee may purchase less than the number of shares covered hereby, provided
that no partial exercise of this option may be for any fractional share or for fewer than ten whole shares. 
  
 (c) Continuous Relationship with the Company Required. Except as otherwise provided in this Section 3, this option may not be exercised unless the 

 Optionee, at the time he or she exercises this option, is, and has been at all times since the date of grant of this
option, an employee, officer or director of, or consultant or advisor to, the Company (an “Eligible Optionee”). 
  
 (d) Termination of Relationship with the Company. If the Optionee ceases to be an Eligible Optionee for any reason, then, except as provided in paragraphs (e) below, the
right to exercise this option shall terminate 90 days after such cessation (but in no event after the Expiration Date), provided that this option shall be exercisable only to the extent that the Optionee was entitled to exercise this option on the
date of such cessation. 
  
 (e) Exercise Period Upon Death or Disability. If the
Optionee dies or becomes disabled (within the meaning of Section 22(e)(3) of the Code) prior to the Expiration Date while he or she is an Eligible Optionee, or if the Optionee dies within three months after the Optionee ceases to be an Eligible
Optionee, this option shall be exercisable, within the period of one year following the date of death or disability of the Optionee (whether or not such exercise occurs before the Expiration Date), by the Optionee or by the person to whom this
option is transferred by will or the laws of descent and distribution, provided that this option shall be exercisable only to the extent that this option was exercisable by the Optionee on the date of his or her death or disability. Except as
otherwise indicated by the context, the term “Optionee”, as used in this option, shall be deemed to include the estate of the Optionee or any person who acquires the right to exercise this option by bequest or inheritance or otherwise by
reason of the death of the Optionee. 
  
 4. Payment of Purchase Price. 

 
 (a) Method of Payment. Payment of the purchase price for shares purchased upon exercise of
this option shall be made (i) by delivery to the Company of cash or a check to the order of the Company in an amount equal to the purchase price of such shares, (ii) subject to the consent of the Company, by delivery to the Company of shares of
Common Stock of the Company then owned by the Optionee having a fair market value equal in amount to the purchase price of such shares, (iii) by any other means which the Board of Directors determines are consistent with the purpose of the Plan and
with applicable laws and regulations (including, without limitation, the provisions of Rule 16b-3 under the Securities Exchange Act of 1934 and Regulation T promulgated by the Federal Reserve Board), or (iv) by any combination of such methods of
payment. 
  
 (b) Valuation of Shares or Other Non-Cash Consideration Tendered in
Payment of Purchase Price. For the purposes hereof, the fair market value of any share of the Company’s Common Stock or other non-cash consideration which may be delivered to the Company in exercise of this option shall be determined in good
faith by the Board of Directors of the Company. 
  
 (c) Delivery of Shares
Tendered in Payment of Purchase Price. If the Optionee exercises this option by delivery of shares of Common Stock of the Company, the certificate or certificates representing the shares of Common Stock of the Company to be delivered shall be duly
executed in blank by the Optionee or shall be accompanied by a stock power duly executed in blank suitable for purposes of transferring such shares to the Company. Fractional shares of Common Stock of the Company will not be accepted in payment of
the purchase price of shares acquired upon exercise of this option. 

 (d) Restrictions on Use of Option Stock. Notwithstanding the foregoing, no shares of Common Stock of the Company may be
tendered in payment of the purchase price of shares purchased upon exercise of this option if the shares to be so tendered were acquired within twelve (12) months before the date of such tender, through the exercise of an option granted under the
Plan or any other stock option or restricted stock plan of the Company. 
  
 5.
Delivery of Share; Compliance With Securities Laws, Etc. 
  
 (a) General. The
Company shall, upon payment of the option price for the number of shares purchased and paid for, make prompt delivery of such shares to the Optionee, provided that if any law or regulation requires the Company to take any action with respect to such
shares before the issuance thereof, then the date of delivery of such shares shall be extended for the period necessary to complete such action. 
  
 (b) Listing, Qualification, Etc. This option shall be subject to the requirement that if, at any time, counsel to the Company shall determine that the listing,
registration or qualification of the shares subject hereto upon any securities exchange or under any state or federal law, or the consent or approval of any governmental or regulatory body, or that the disclosure of non-public information or the
satisfaction of any other condition is necessary as a condition of, or in connection with, the issuance or purchase of shares hereunder, this option may not be exercised, in whole or in part, unless such listing, registration, qualification, consent
or approval, disclosure or satisfaction of such other condition shall have been effected or obtained on terms acceptable to the Board of Directors. Nothing herein shall be deemed to require the Company to apply for, effect or obtain such listing,
registration, qualification or disclosure, or to satisfy such other condition. 
  
 6. Nontransferability of Option. This option is personal and no rights granted hereunder may be transferred, assigned, pledged or hypothecated in any way (whether by operation of law or otherwise) nor shall any such rights be subject to
execution, attachment or similar process, except that this option may be transferred (i) by will or the laws of descent and distribution or (ii) pursuant to a qualified domestic relations order as defined in Section 414(p) of the Code. Upon any
attempt to transfer, assign, pledge, hypothecate or otherwise dispose of this option or of such rights contrary to the provisions hereof, or upon the levy of any attachment or similar process upon this option or such rights, this option and such
rights shall, at the election of the Company, become null and void. 
  
 7. No
Special Employment or Similar Rights. Nothing contained in the Plan or this option shall be construed or deemed by any person under any circumstances to bind the Company to continue the employment or other relationship of the Optionee with the
Company for the period within which this option may be exercised. 
  
 8. Rights as
a Shareholder. The Optionee shall have no rights as a shareholder with respect to any shares which may be purchased by exercise of this option (including, without limitation, any rights to receive dividends or non-cash distributions with respect to
such shares) unless and until a certificate representing such shares is duly issued and delivered to the Optionee. No adjustment shall be made for dividends or other rights for which the record date is prior to the date such stock certificate is
issued. 

 9. Adjustment Provisions. 
  
 (a) General. If, through or as a result of any merger, consolidation, sale of all or substantially all of the assets of the Company, reorganization, recapitalization,
reclassification, stock dividend, stock split, reverse stock split or other similar transaction, (i) the outstanding shares of Common Stock are increased or decreased or are exchanged for a different number or kind of shares or other securities of
the Company, or (ii) additional shares or new or different shares or other securities of the Company or other non-cash assets are distributed with respect to such shares of Common Stock or other securities, the Optionee shall, with respect to this
option or any unexercised portion hereof, be entitled to the rights and benefits, and be subject to the limitations, set forth in Section 7(b) of the Plan. 
  
 (b) Board Authority to Make Adjustments. Any adjustments under this Section 9 will be made by the Board of Directors, whose determination as to what adjustments, if any,
will be made and the extent thereof will be final, binding and conclusive. No fractional shares will be issued pursuant to this option on account of any such adjustments. 
  
 10. Mergers, Consolidation, Distributions, Liquidations, Etc. In the event of a merger or consolidation or sale of all or substantially all
of the assets of the Company in which outstanding shares of Common Stock are exchanged for securities, cash or other property of any other corporation or business entity, or in the event of a liquidation of the Company, prior to the Expiration Date
or termination of this option, the Optionee shall, with respect to this option or any unexercised portion hereof, be entitled to the rights and benefits, and be subject to the limitations, set forth in Section 7(b) of the Plan. 
  
 11. Withholding Taxes. The Company’s obligation to deliver shares upon the exercise of
this option shall be subject to the Optionee’s satisfaction of all applicable federal, state and local income and employment tax withholding requirements. 
  

12. Miscellaneous. 
  
 (a) Except as provided herein, this option may not be amended or otherwise modified unless evidenced in writing and signed by the Company and the Optionee. 
  
 (b) This option shall be governed by and construed in accordance with the laws of the State of Maryland. 
  

			
	 Date of Issue:
  
 IssueDate
	  	 SUNTERRA CORPORATION

  

			
	 
		
	By:	 	 
	 	 	 Frederick C. Bauman

	 Its:
	 	 Secretary

 OPTIONEE’S ACCEPTANCE 
  
 The undersigned hereby accepts the foregoing option and agrees to the terms and conditions thereof. The undersigned hereby acknowledges receipt of a copy of the
Company’s 2002 Stock Option Plan. 
  

			
	OPTIONEE:	  	 ADDRESS:
  
 OptioneeAddress1
 OptioneeAddress2
 OptioneeAddress3

  

	
	
	  
	 Optionee

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