Acoje Holdings, Inc.

December 10, 1999 PSE CIRCULAR FOR BROKERS NO. 3164-99 SUBJECT : Acoje Holdings, Inc . Acoje Holdings, Inc. ("AJO") furnished the Exchange a copy of its Amended SEC Form 11-A for the fiscal year ended June 30, 1999 with amendments on the following items: Item 1. Business ". . . As of June 30, 1999, the only major investment holding of the company would be its 485 shares at the Metropolitan Club, Inc. ("Metroclub"), a non-stock, non-profit sports membership club. The shareholdings of the company at Metroclub would be approximately 30.3% of all outstanding shares of the club. . . ." LexLib Item 2. Properties ". . . 2. The company's other hard assets are composed mainly of old vehicles, various spare parts, and other drilling accessories that have either been fully depreciated or have full provisions for allowances for obsolescence." prcd Item 4. Submission of Matters to a Vote of Security Holders The annual stockholders meeting for the fiscal year ended June 30, 1998 was held last May 28, 1999 at Metroclub. The pertinent disclosure on the said stockholders meeting was duly filed with SEC on Form 11-C on May 31, 1999. The annual stockholders' meeting for the fiscal year ended June 30, 1999 will be held on November 29, 1999 Item 5. Market for Registrant's Common Equity and Related Stockholder Matters ". . . B. High and low sales 1999-1998 Price per Share Low High April - June 1999 1.96 0.65 Jan. - March 1999 0.82 0.50 Oct. - Dec. 1998 1.10 0.28 Jul.- Sept. 1998 1.40 0.34 April - June 1998 2.18 1.50 Jan. - Mar. 1998 3.40 1.20* Oct. - Dec. 1997 3.90 1.70* July - Sept. 1997 1.85 0.35* * Adjusted for change in par value from P0.01 to 1.00 on 02/09/98 3. Dividends The company has not declared any dividends because of the deficit balance on the company's Retained Earnings account. Recent Sales of Unregistered Securities During the fiscal year ended June 30, 1999, there was no sale of unregistered securities of the company. Item 6. Management's Discussion and Analysis of Plan of Operation ". . . On January 25, 1996, the stockholders of Acoje approved the change in the primary purpose of the company from oil exploration to that of an investment holding company and a change in company name to Acoje Holdings, Inc. . . . The company also intends to go into other investments that will be focused on "high technology firms" as broadly described. This other investments are expected to be funded from a call for the full payment on all the unpaid subscriptions on the company's common shares. Of the aforementioned investment arena, the company shall have a special concentration on entities engaging or planning to engage into product/service offerings using the Internet as their major business platform. The targeted companies would include entities whose potential markets are regional and/or global, whose business concepts and plans are innovative and creative, and whose proponents are deeply committed, technologically proficient, and entrepreneurially motivated. . . . The huge peso depreciation that occurred in 1997 had no material adverse impact on the company as Acoje neither had any foreign currency denominated liabilities nor transactions. . . ." Item 7. Financial Statements A. 2. ". . . There was no dividend income received on the above securities during the fiscal year." A.3. ". . . For the fiscal year ended June 30, 1999, the company wrote off receivables amounting to P1,169,724.18. On the non-written off balance of P344,253.00, the company provided for almost all trade and other receivables inasmuch as these receivables are over 10 years old. Other receivables are comprised of the following: a. Vicente Goquiolay & Co., Inc. P58,505.00 b. ATC Securities, Inc. 12,120.00 P70,625.00 A.4. ". . . For the fiscal year ended June 30, 1999, the company wrote off other current asset amounting to P494,293.69. These write offs consist of income tax refundable amounting to P419,629.46 and prepaid income tax amounting to P74,664.23. The foregoing accounts were written off since the accounts are over the prescribed period allowed by the BIR for the company to be able to use them as tax credits." cdll A.5. ". . . The company sold two (2) shares of Metroclub during the fiscal year." A.6 Depreciation a. The depreciation of property and equipment charged during the period based on cost is P299,159.00 b. The depreciation of property charged during the period based on appraised value amounted to P333,500.00 All of the above depreciation expenses, which total to P632,659.00 were charged to operations. cdll A.7 Property and Equipment Our accounting policy with respect to revaluation increment on property is as follows: cdlex "The revaluation increment account is treated as a permanent account and is not diminished by any depreciation charges. The accumulated depreciation on revaluation is disclosed in a note to the financial statements". This is in accordance with paragraph 17-A of the statement of Accounting Standards No. 12. LibLex A.8. Other Assets The beginning balance of this account is established as follows: 1) Permanent investment P5,000.00 2) Inventory 409,078.02 3) Deposit 48,617.60 4) Machinery and Equipment 2,158,277.66 Total P2,620,972.68 Less: Accumulated depreciation 1,984,443.25 Allowance for obsolete 409,078.02 Net 227,451.41 ============ For the fiscal year ended June 30, 1999, the company decided to write off the deposit account amounting to P48,617.60 and the remaining book value of machinery and equipment after depreciation amounting to P173,834.41 inasmuch as the company is no longer engaged in any drilling operations. A.9. Advances to affiliated company These are advances to Gem Communication Holdings., Inc., a shareholder of the company. The advances amount to P18,700,000.00. Shares held by Gem Communications Holdings, Inc. on Premiere Entertainment Production, Inc. collateralize these advances. The advances bear interest, which is market based. All of the advances were made during the fiscal year. A.10 Bank Loans These are loans from Equitable Banking Corporation collateralized by a pledge on a portion of the investment by the company in the proprietary shares of Metroclub. The loans were drawn under a credit facility agreement expiring on October 1999. Interest rates on the loans are market based and re-priced on a monthly basis. A.13. Loss per share: 1999 = P12,303,328.00 510,063,298 shares = P0.02412/share 1998 = P5,695,718.00 510,063,298 shares = P0.0112/share 1997 = P12,264,201.00 51,006,329,813.00 shares = P0.000240/share * Note: * The total subscribed shares are based on P0.01 old par value A.14. Loss on sale of securities: Loss on sale of marketable securities amounted to P359,152.02 Loss on sale of investment amounted to P725,000.00 Item 9. Directors and Executive Officers of the Registrant 2. Term of Office term of office of a director is one year . 5. Involvement in Certain Proceedings . LexLib The company, or its subsidiaries, is not a party to any pending legal proceedings. It is not involved in any legal proceedings with respect to any of its properties. It is not involved in any claims or lawsuits involving damages that may materially affect it or its subsidiaries. Item 10. Executive Compensation The aggregate amount of compensation paid by the Company to its directors, and management as a group for the fiscal year ended June 30, 1998 amounted to P828,000.00. For the fiscal year ended June 30, 1999, the company paid the aggregate amount of P475,000.00 in compensation to its directors and executive officers as a group. For the fiscal year ending June 30, 2000, the company projects to pay an aggregate amount of P2,750,000.00 to its executive officers and directors as a group. llcd Annual compensation Name and Principal Position 1997-1998 1998-1999 1999-2000 1. Anselmo Trinidad, Jr. Chairman 2. Salvador C. Martinez President/CEO (Since August 15, 1999) 3. Ernesto Tongson Vice President for Special Projects (until March 1997) and President/CEO (since March 1997 until August 1999) 4. Gonzalo Goquiolay Technical consultant to the Board of Directors 5. Hirene Lopez Exec. Vice-Pres. And Treasurer ========== ========== =========== Aggregate Compensation of the CEO & Four Mostly High-Paid Executives P708,000.00 P235,000.00 P2,100,000.00 All Officers and Directors as a Group Unnamed 828,000.00 475,000.00 2,750,000.00 Item 11. Security Ownership of Certain Beneficial Owner 1. Security Ownership of Certain Beneficial Owner As of June 30, 1999, Acoje Holdings, Inc. knows of no one who beneficially owns in excess of 10% of its common stock except as set forth below. Title of Class Name No. of share Nature Percentage 1. Common GEM Communications Holdings Corporation 325,258,000 Record/Beneficial 63.81% 2. Common Atc Securities, Inc.* 150,435,202 Record/Beneficial 29.51% *ATC subscribed to Acoje common shares on its behalf and on behalf of its clients. The common shares subscribed for ATC's account are 50,530,000 common shares while those held for its clients' accounts total 99,905,202 of which 30,670,000 common shares are beneficially owned by Anselmo Trinidad, Jr. The common shares beneficially owned by each client of ATC including that of Anselmo Trinidad, Jr. will not result in any of them owning or holding at least 10% of the company's outstanding capital stock, even it such beneficially-owned common shares are combined with other common shares registered under each client's respective name, as the case may be. 2. Security Ownership of Management Title of Class Name Amount and Nature of Beneficial Ownership Percent of class Common Anselmo Trinidad, Jr. 50,020,000 shares sole voting* 9.80% Item 12. Certain Relationship and Related Transactions Mr. Gonzalo Goquiolay, a director and the technical assistant to the Board is the husband of Mrs. Carmen F. Goquiolay, assistant to the president of the Company. The Company retains the law firm of Castillo-Laman Tan Pantaleon & San Jose Law Offices (CLTPS) where the corporate secretary, Atty. Roberto V. San Jose, is a senior partner. During the last fiscal year, the Company paid CLTPS legal fees that the Company believes to be reasonable. cdll The company's parent, GEM Communications Holdings, Inc., owns and controls 325,258,000 shares or 63.80% of the company's outstanding capital stock. A copy of AJO's Amended SEC Form 11-A for the fiscal year ended June 30, 1999 is available for reference at the PSE Centre and PSE-Plaza Libraries. For your information. prcd (SGD.) MARIA ISABEL T. GARCIA OIC, Listings and Disclosure Group