PSE Circular for Brokers No. 1314-99

June 4, 1999 PSE CIRCULAR FOR BROKERS NO. 1314-99 PHILIPPINE STOCK EXCHANGE, INC . DISCLOSURE DEPARTMENT Exchange Rd., Ortigas Center, Pasig City Fax No. 636-0809 Attention: Ms . Grace B . de Guia Asst . Manager Ms . Katrina V . Doble Disclosure Department RE : Centennial City, Inc . (CCI) Gentlemen : We refer to your letter dated 29 May 1999 requesting for clarification of the Philippine Daily Inquirer article (which reported that under the old agreement, the titles to the Three Islands would be conveyed to Amari after payment of P500 million, while under the new agreement Amari will get its share only after the project is completed) particularly under whose name the title to the Three Islands is before and after the signing of the agreement. The original Joint Venture Agreement (JVA) between the Public Estates Authority (PEA) and Amari Coastal Bay Development Corp. (Amari), which was still effectively binding on the parties, underwent a renegotiation resulting in an amended JVA which was approved by the new PEA Board, signed by the parties on 30 March 1999, and, after further scrutiny by the Government Corporate Monitoring and Coordinating Committee, approved by the Office of the President on 28 May 1999, the highest approving body in government. The approval of the amended JVA reconfirmed the validity of the original JVA, addressed the allegedly objectionable portions of the original JVA, stressed the Joint Venture nature of the project, and resulted in a substantial enhancement of the government's share in the project. LLpr In this regard, we note that prior to the signing of the original JVA, title to the Three Islands was in the name of PEA under Transfer Certificate of Title Nos. 7309, 7311 and 7312 of the Registry of Deeds for Paraaque. Prior to the execution of the amended JVA, title to the Three Islands still remains with PEA. We now proceed to address your query and clarify the statement that "under the new agreement Amari will get its share only after the project is completed" since this creates the appearance that the titling of the areas in favor of PEA and/or AMARI will be undertaken only after at least seven years from the effectivity of the amended JVA. This is inaccurate. In the original JVA, while title to the Three Islands would initially be conveyed to Amari as bases of its operations, these titles would be cancelled, consolidated with the other titles of the Reclamation Area, and allocated to PEA or Amari, as the case may be, in accordance with the Land Allocation Plan. The same very same intention is carried over in the amended JVA. The Three Islands were always intended to be, contributed by PEA to the Joint Venture to be held by Amari for the joint as bases of its operations. This concept was strengthened in the amended JVA by specifically providing that PEA's rights over the Three Islands will be contributed by PEA to the Joint Venture. Under the amended JVA, titling of the entire Reclamation Area will be done in phases upon accomplishment by Amari of the Rawland Reclamation of at least 1.5 mean low lower water level of any portion of the Reclamation Area. This means that, depending on the Land Allocation Plan, titles to the Reclamation Area, including those over the Three Islands, will be issued in favor of the entity to which the parcel of Reclamation Area pertains in accordance with the Land Allocation Plan. The titles to such portions of the Net Usable Area allocated to Amari will be held by PEA for Amari. Furthermore, within 30 days from the issuance of the Original Certificate of Title for the parcels of land, and the accomplishment by Amari of the Rawland Reclamation of at least 3.0 mean low lower water level of such portion of the Reclamation Area, including the Three Islands, PEA must execute without delay the necessary deed of transfer of title pertaining to Amari's Land Share based on the Land Allocation Plan. Even prior to delivery of the title to Amari, however, Amari has the right to utilize any portion of the Reclamation Area, including the Three Islands, in order to avail of all forms of investment and financing schemes to raise funds, and PEA must execute the necessary mortgages, pledges and other documents and deeds necessary to constitute a security interest over these portions of the Reclamation Area. All the foregoing terms and conditions will be annotated on all the titles covering the Reclamation Area thus protecting the vested rights of the parties to their Land Share. LLpr We trust that the foregoing sufficiently addresses your query. Please call or write us should you have any questions. Very truly yours, CENTENNIAL CITY INC. By: (SGD.) ATTY. PETER C. SUCHIANCO Corporate Secretary