PSE Circular for Brokers No. 1429-99

June 17, 1999 PSE CIRCULAR FOR BROKERS NO. 1429-99 DISCLOSURE DEPARTMENT Listings and Disclosure Group Philippine Stock Exchange, Inc. 4/F Philippine Stock Exchange Centre Exchange Road, Ortigas Center Pasig City, Metro Manila Attention: Ms . Grace B . De Guia Asst . Manager Gentlemen : We confirm receipt of your letter of today's date regarding your request for clarification of the Manila times article, which we received at 8:52 a.m. this morning. We have not as yet received a signed copy of the arrangement from PAGCOR but we believe that the information contained in the article is generally accurate, with the exception that the approval with PAGCOR received was, to our knowledge, from the Office of the Government Corporate Counsel (OGCC) and not from Justice Secretary Cuevas. The OGCC is the normal approving authority for PAGCOR contracts. Approval for PAGCOR to operate Jai-Alai was also received from the Office of the President through Executive Secretary Ronaldo Zamora. LLjur We understand that PAGCOR has issued a Press Statement regarding the details of the agreement which, as operate, is their right and responsibility. We urgently request that trading in Belle stock be immediately resumed. Very truly yours, (SGD.) A. BAYANI K. TAN Corporate Secretary Pagcor, Belle sign jai-alai agreement By CARMINA E. REYES Reporter The Philippine Amusement and Gaming Corp. (Pagcor) finally signed last night an agreement with Belle Jai-Alai Corp. and Filipinas Gaming Corp. reviving jai-alai games in the country, according to sources in the state-owned gambling monopoly. Pagcor spokesperson Senen Lainez told The Times the agreement was signed by, among others, Pagcor chair Alice Reyes and Belle Corp. chair Roberto Ongpin. "Pagcor has signed an agreement with Belle Jai-Alai Corp. and Filipinas Gaming Entertainment Totalizator Corp. paving the way for the resumption of jai-alai operations under Pagcor's direct control of supervision," he said. Another Pagcor official, Erasmo Rivera head of Pagcor's jai-alai task force, also said that Pagcor Chairwoman Alice Reyes signed the agreement yesterday after it was approved by government lawyers and Justice Secretary Serafin Cuevas. Cdphil "I want to fast-track this, so we can reopen it as soon as possible." Rivera told Bloomberg News. "We are providing employment and we are providing entertainment." The contract breaks as a deadlock of over three years that stalled the return of the popular game, which was shut down by then President Corazon Aquino in 1986. In Malacaang, Executive Secretary Ronaldo Zamora also confirmed the signing of the agreement, adding that he has given Pagcor the go-signal to finalize the deal a week ago. Anticipating possible criticism that the agreement violates the constitutional provision that only Congress can grant gambling franchises, Zamora stressed that the deal does not vest the private parties any franchise or license to engage jai-alai operations. He clarified that the jai-alai operations will be undertaken by Pagcor itself. Under the joint-venture agreement, Pagcor will operate the arena, known as a fronton, and supply the personnel. Pilipinas Gaming, a unit of retail magnate Henry Sy's empire, owns the fronton. Gaming revenue will be divided equally among the government, Belle and Pilipinas Gaming. A date for restarting the games has yet to be fixed. Belle, a Manila-based developer that built the Tagaytay Highlands golf resort south of Manila, will provide the capital and will run as many, as 300 off-site betting installations throughout the country. Belle is counting on its gaming interests to offset slumping property sales. Jai-alai, a ball game with rules similar to handball, enjoyed immense popularity in the Philippines until Aquino revoked an exclusive contract to operate the sport held by the brother-in-law of former dictator Ferdinand Marcos. Belle shares rose 9.3 percent to P2.95, their highest level since November 1997. The company's warrants surged 48 percent to 0.46 peso. "Belle will provide the funds needed to cover all capital expenditures including the use of an integrated computerized system for online and offline betting," Lainez told The Times . "Filipinas Gaming will make available the jai-alai fronton facilities located within the Harrison Plaza compound in Malate, Manila." "With the agreement signed, the parties, can now focus on finalizing other operational details leading to the relaunching of jai-alai operations in the country at the soonest time possible," Lainez added. cdlex The Pagcor spokesperson couldn't say when the games will begin but another company official said they're looking at a possible relaunch this Saturday, June 19. The official said at least 100 off-site betting stations in Metro Manila will be open by that time. With reports from Sandra Aguinaldo and Bloomberg News