PSE Circular for Brokers No. 1707-99

July 13, 1999 PSE CIRCULAR FOR BROKERS NO. 1707-99 SECURITIES AND EXCHANGE COMMISSION SEC FORM 11-C CURRENT REPORT UNDER SECTION 11 OF THE REVISED SECURITIES ACT (RSA) AND RSA RULE 11(a)-1(b)(3) THEREUNDER 1. July 12, 1999 (Date of earliest event reported) 2. SEC Identification Number 35815 3. BIR Tax Identification No. 000-489-462 4. PILIPINO TELEPHONE CORPORATION Exact name of registrant as specified in its charter 5. PHILIPPINES Province, country or other jurisdiction of incorporation 6. _________ (SEC Use Only) Industry Classification Code 7. 9th Floor Bankers' Centre 1200 6764 Ayala Avenue Postal Code Makati City Address of principal office 8. (632) 891-3888 Registrant's telephone number, including area code 9. N. A. Former name or former address, if changed since last report 10. Securities registered pursuant to Sections 4 and 8 of the RSA Title of Each Class Number of Shares of Common Stock Licensed and Amount of Debt Outstanding Common Shares 1,688,088,793 common shares 1 Long Term Commercial Papers P1,000,000,000.00 shares 11. Indicate the item numbers reported herein: Item 3 and Item 9 Item 3 At the regular meeting of the Board of Directors held on July 8, 1999, the Board appointed Joaquin Cunanan & Company as the Company's external auditors for the fiscal year 1999. The Company's external auditors for the immediately preceding fiscal year was Sycip Gorres Velayo & Company ("SGV"). There were no disagreements with SGV on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure. LibLex Item 9 On July 5, 1999, the Company received from its counsel a copy of the Arbitral Award issued on June 23, 1999 by the Arbitrator Justo P. Torres, Jr. in connection with the arbitration proceedings entitled "Pilipino Telephone Corporation (Claimant) versus Philippine Global Communications Inc. (Respondent). The dispositive portion of the Arbitral Award reads as follows: "Accordingly, an Arbitral Award is hereby issued as follows: 1. Declaring Philcom excused from paying the balance of the subscription price under the Subscription Agreement dated 30 April 1997 and the amended Subscription Agreement dated 30 October 1997; 2. Ordering Philcom to pay Piltel the amount of P294,597,406.00 deductible from the downpayment of P516,475,116.00; 3. Ordering Philcom to pay Piltel any liability, as mutually determined by the parties, that it may have to the latter arising from or in connection with the working alliance or any business arrangement, also deductible from the downpayment of P516,475,116.00; 4. Ordering Piltel to convert the balance, if any, of the downpayment, after deducting the P294,597,406.00 and any liability of Philcom to Piltel as decreed in item 3 above, to common shares at the original subscription price of P20.00 per share; and 5. Ordering Philcom to increase Piltel's share, over a 5-year period, to seventy percent (70%) of the Philippine share (Philippine Retention) for offered outgoing traffic carried by Philcom's international gateway facility. SO ORDERED." SIGNATURE Pursuant to the requirements of the Revised Securities Act, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereto duly authorized. LexLib PILIPINO TELEPHONE CORPORATION (SGD.) MA. LOURDES C. RAUSA-CHAN Corporate Secretary Footnotes 1. This excludes the subscription of Philippine Global Communications, Inc. (Philcom) to 258,237,558 common shares.