PSE Circular for Brokers No. 3016-99

November 26, 1999 PSE CIRCULAR FOR BROKERS NO. 3016-99 November 25, 1999 Philippine Stock Exchange, Inc. Philippine Stock Exchange Center Exchange Road, Ortigas Center Pasig City Attention: Ms . Grace B . De Guia Asst . Manager, Disclosure Department Dear Madam: We acknowledge receipt of your FAX Message dated November 11, 1999 addressed to our Corporate Secretary, Justice Camilo D. Quiason, concerning that article in the Business World which reported that our Company braces for labor problems after our rank-and-file union, the Meralco Employees and Workers Association (MEWA), filed a complaint for unfair labor practices at the National Conciliation and Mediation Board (NCMB). It is not true that the union filed a complaint for unfair labor practices at the NCMB. What it filed was a case for "preventive mediation" allegedly in behalf and in representation of what the union President Juanito G. Rivera described in said article as some 200 "project-hired employees" terminated by our Company. The union has charged our Company of illegal dismissal, withholding of salaries, and harassment. cdlex These project employees were hired to perform work/services in the Meralco Transformation Project by virtue of temporary employment contracts of fixed duration and/or coterminous with certain phases of the project. They acted as alternates for regular employees who were temporarily transferred/assigned to the project or in the reengineering of certain functions or offices. With the transformation project drawing close to completion, we have reached the stage where we have to terminate the temporary employment contracts. As the hiring of these project employees under temporary employment contacts are authorized by existing laws and jurisprudence, and by reason also of the fact that they do not belong to the collective bargaining unit being represented by MEWA, we moved for the termination of the mediation proceedings during the hearing last November 18. Thank you and please accept this as our compliance with your directive to make an official, full, fair and accurate disclosure on the matter. Very truly yours, (SGD.) GIL S. SAN DIEGO Assistant Corporate Secretary