PSE Circular for Brokers No. 2312-98

October 6, 1998 PSE CIRCULAR FOR BROKERS NO. 2312-98 October 5, 1998 FAX FOR: Ms. Grace B. De Guia Supervisor, Disclosure Department PHILIPPINE STOCK EXCHANGE, INC . Ms. Janet J. Alcala Analyst, Disclosure Department PHILIPPINE STOCK EXCHANGE, INC . Tel. Nos.: 636 0122 to 41 local nos.: 706 / 811 / 812 Fax Nos.: 636 0809 / 637 8811 FROM : Atty. Tadeo F. Hilado Corporate Secretary VITARICH CORPORATION This refers to your fax message of 1 October 1998 which requests Vitarich Corporation ("VITA") to "make an official, full, fair and accurate written disclosure" regarding the article entitled "Vitarich soars 48% on joint venture talks" published in the 1 October 1998 issue of the Manila Times. LLjur 1. Please be advised that VITA and other chicken integrators have on some occasions discussed the idea of getting together for the purpose of reducing operating expenses and controlling the costs of chicken production in order to keep the prices of chicken stable and affordable. Such idea, however, is only an option at this time, and nothing definite has been concluded regarding the proposal. 2. With respect to the plan to sell the Texas Chicken Restaurants, the said restaurants are not owned by VITA, but are owned by Philippines' Favorite Chicken, Inc. which is a subsidiary of VITA. VITA is looking for a strategic investor which would provide the capital to implement the development agreement signed with the US principal, American's Favorite Chicken, for the development of 50 Texas Chicken stores in the Philippines by the year 2001. The plan to search for a strategic investor includes VITA's willingness to be diluted to a minority shareholder status to full divestment from VITA. Under the agreement of vita with its creditor banks, 50% of the proceeds from the sale of VITA's interest in Texas Chicken will be used to reduce its debt, while the balance will be set aside for working capital. We trust that the above is sufficient for your purposes. (SGD.) TADEO F. HILADO