Philippine Stock Exchange

February 20, 1998 PSE CIRCULAR FOR BROKERS NO. 179-98 February 19, 1998 Philippine Stock Exchange Exchange Center, Exchange Road Ortigas Center, Pasig City Attention : Ms . Grace de Guia Compliance Monitoring and Listing Group Gentlemen : In compliance with your rule on corporate disclosures, we are enclosing herewith for the information of the Exchange a copy of our letter to stockholders of Republic Cement Corporation informing them of the offer of South Western Cement Ventures, Inc., the local joint venture company of Blue Circle Industries, PLC and the Yuchengco Group to buy shares of Republic Cement Corporation. The attached letter and its enclosures shall be released to stockholders tomorrow, February 20, 1998. dctai We are also informing the Exchange that a Loan Agreement between Republic Cement Corporation and South Western Cement Ventures, Inc. was signed this morning, together with the non-assignable and non-negotiable convertible promissory note for Php860.0M issued by Republic Cement Corporation in favor of the latter. The promissory note is convertible into 200,000,000 common shares of Republic Cement Corporation at the conversion price of Php4.30 per share. Conversion can be exercised by either South Western Cement Ventures, Inc or Republic Cement Corporation after two weeks from February 19, 1998 up to maturity of the promissory note on February 18, 2001. We trust you will find our disclosures in order. Very truly yours, REPUBLIC CEMENT CORPORATION (SGD.) EDGARDO V. PAJAO Asst . Corporate Secretary February 16, 1998 NOTICE ON PARTICIPATION OF SHAREHOLDERS OF REPUBLIC CEMENT CORPORATION IN THE SALE OF SHARES TO SOUTH WESTERN CEMENT VENTURES, INC . Dear Shareholder, Overview South Western Cement Ventures, Inc., a Philippine joint venture between Blue Circle Industries PLC and the Yuchengco Group ("South Western") has made an offer to buy up to 120,000,000 shares of Republic Cement Corporation ("RCC") at P4.30 per share (the "Offer"). To evenly spread the benefits of this Offer, RCC has decided, without assuming any liability thereof, to give all RCC shareholders of record as of February 16, 1998 the opportunity to participate in the Offer by selling up to 10% of their existing RCC common shares to South Western. South Western has also offered to purchase a P860,000,000 unsecured Convertible Note maturing 3 years after its issuance and convertible at the option of either RCC or South Western into 200,000,000 fully-paid listed common shares of RCC at a conversion price of P4.30 per share. The issuance of the Convertible Note was duly approved by RCC's Board of Directors and Executive Committee. Blue Circle Industries PLC, which is a corporation based in England, has ownership interest and/or manages cement companies in various parts of Asia, among others. On the other hand, the Yuchengco Group is mainly engaged in banking, insurance and construction business. South Western can make a strategic and meaningful contribution to RCC's long-term business. Mechanics of Participation Eligibility and Entitlement . Each registered shareholder of RCC as of February 16, 1998 ("Reference Date") shall be entitled to sell to South Western up to 10% of the shares held as of Reference Date. If the entitlement results in a fraction of a share, then such fraction cannot be sold. Selling Price . P4.30 per share, less any applicable taxes, fees (commission and Philippine Central Depository ad valorem rate) and other expenses which shall be for the account of the Participating Shareholder. Manner of Participation . All interested eligible shareholders who opt to participate in the Offer must complete the following documents (forms attached hereto): a) Duly executed Irrevocable Power of Attorney, in the form attached, authorizing the Broker, acting through any of its Directors, to sell the number of Participation Shares indicated therein and to sign, execute and deliver the Deed of Assignment in favor of South Western, on behalf of the Participating Shareholders; and b) Form of Consent to Sell Shares . If the Participating Shareholder is a corporation, trust or partnership, the Form of Consent to Sell must be accompanied by a notarized secretary's certificate setting forth the resolutions of the Participating Shareholder's Board of Directors or equivalent body, authorizing the sale of the Participation Shares which are the subject of the Form of Consent to Sell and designating the signatories for the purpose. c) Duly Accomplished Account Opening Forms with Required Documents as stated herewith: For Corporation : SEC Registration Copy of Articles of Incorporation and By-Laws Board Resolution authorizing opening of account with JFECSI or DMG Officers authorized to operate the account For Individual : Photocopies of valid identification card i.e., driver's license, SSS card, TIN card, passport For Partnership : SEC Registration Copy of General Partnership Agreement Officers authorized to operate the account together with the duly endorsed stock certificates evidencing the Participation Shares to be sold (if certified) and submit the same to either: JARDINE FLEMING EXCHANGE CAPITAL SECURITIES, INC . 22nd Floor, Tower One, Exchange Plaza Ayala Triangle, Makati City or DEUTSCHE MORGAN GRENFELL SECURITIES PHILIPPINES, INC . 23rd Floor, Tower One, Exchange Plaza Ayala Triangle, Makati City (the "Broker") not later than 5:00 p.m. of March 15, 1998 (the "Participation Date"): Crossing and Escrow of Shares : The Participation Shares shall be transferred to South Western by means of a block sale through the Philippine Stock Exchange within 3 Trading Days from receipt of the documents required herein. (the "Crossing Date"). All stock certificates representing the Participation Shares shall, from the Participation Date to the Crossing Date, be deposited and held in escrow by the Broker. Stock certificates in the name of South Western following the block sale shall likewise be held in escrow by the Broker. Payment : Payment for the Participation Shares shall not be made immediately upon surrender of the stock certificates or submission of the required documents. Payment shall be made after 4 Trading Days from the Crossing Date (T + 4), by means of a check made out in favor of the relevant Participating Shareholder and crossed "Payee's Account Only" in the relevant amount representing payment for the Participation Shares which shall be made available at the office of the Broker under the Irrevocable Power of Attorney. If not claimed within 30 days after notice of availability, such check shall be mailed or delivered at the Participating Shareholder's risk, to the address specified by the Participating Shareholder in the Form of Consent to Sell or the relevant PCD Participant. Action To Be Taken To be valid, the enclosed form of Consent to sell, Irrevocable Power of Attorney, duly endorsed Stock Certificates must be submitted to and received at the offices of either Jardine Fleming Exchange Capital Securities, Inc. or Deutsche Morgan Grenfell Securities Philippines, Inc. by not later than 5:00 p.m. of March 15, 1998. If the executed Form of Consent to Sell and the Irrevocable Power of Attorney or any of the other required documents have not been received from you by said date, it shall be assumed that you do not wish to sell any of your shares. dctai If you have further questions with respect to the foregoing, please call Ms. Chato Razon or Kathy Pagunsan of Jardine Fleming Exchange Capital Securities, Inc. at telephone numbers 841.9840 and 841.9841 or Ms. Dita Tanedo or Majette Panelo of Deutsche Morgan Grenfell Securities Philippines, Inc. at telephone numbers 894.6620 and 894.6629. Very truly yours, REPUBLIC CEMENT CORPORATION (SGD.) JUAN MIGUEL R. MONTINOLA President and CEO