PSE Circular for Brokers No. 732-99

April 13, 1999 PSE CIRCULAR FOR BROKERS NO. 732-99 April 12, 1999 PHILIPPINE STOCK EXCHANGE, INC . PSE Center, Exchange Road, Ortigas Center, Pasig City Attention: Mr . Jose Luis E . Yulo , Jr . President and Chief Executive Officer Gentlemen : In reply to your request for clarification of the news article entitled, "Fil-Estate Socks Debt Restructuring," published in the April 12, 1999 issue of the Philippine Daily Inquirer, please find attached copy of the press release in response to the above-mentioned article, which shall be published tomorrow by the same daily. Please note that Fil-Estate, Inc. (LND) only has a P1 Billion in short-term blank loans, which have been covered into long-term loans, payable within the next three to five years. These are the only interest bearing loans out of LND's total liabilities of P9.3 Billion. LexLib The bulk of liabilities, amounting to P3.8 Billion represents payable to contractors and suppliers, which is normal in view of the continuing operations and expansions. Another P2.6 Billion is actually a reserve which represents the estimated cost to cover the completion cost over the next two to five years of sold real estate and golf shares. We trust we have clarified matters to your satisfaction. Should you require further clarification, please feel free to call us. Thank you very much. Very truly yours, (SGD.) ROBERTO S. ROCO Chief Finance Officer PRESS RELEASE 12 April 1999 FIL-ESTATE LAND FORGES AGREEMENTS WITH BANKS Fil-Estate Land, Inc. has forged agreements with various creditor banks for the conversion of P1-billion short term loans into long-term loans which will allow the property to repay its obligation within the next three to five year. Fil-Estate chief financial officer Roberto S. Roco said the agreements "will ensure the full repayment of the loans from sales which are likely to pick up once the economy improves." Roco said that although these loans are renewed annually, "we have requested and our creditor banks have agreed to convert these obligations into long term loans." Roco said Fil-Estate's creditor banks support the company's Buyer Power Advantage Program for end-buyers which gives longer and easier purchase terms (up to 20 years repayment period) for house and lot units, condominium and townhouses. "There are currently four banks and other have indicated willingness to participate in our program which has already reached the P1 billion mark in option sales since it was launched in the last quarter last year, "Roco said. LLpr He said the loans worth P1 billion are the only interest-bearing obligations out of Fil-Estate's total liabilities of P9.3 billion. In relation to equity of P8.4 billion, this represents a bank debt to equity ratio of only 12.3 percent. "The bulk of these liabilities of P3.8 billion, which grew from P3.2 billion the previous year, represents payables to contractors and suppliers with whom we have long-term dealings. "This is normal in our business in view of continuing operations and expansion. In fact, this amount reflects the faith and trust of our long-term partners as a result of good relations, "Roco said. He said this amount is likely to grow further as the company step up its expansion projects particularly the Forest Hills Residential Estates and Golf & Country Club in Antipolo, the Manila Southwoods in Cavite, and other real estate projects linked to the EDSA MRT III, the 52-hectare Malabon first class residential haven, and the sprawling Naic Cavite residential subdivision for the middle-income market. prLL Another P 2.6 billion set aside by Fil-Estate for real estate golf club and resort development is actually a reserve representing the estimated cost to complete sold real estate and golf shares. "There is no actual liability to anyone and the reserves are intended to cover the completing cost over the next 2 to 5 years," Roco added. Roco said Fil-Estate, which was formed 18 years ago under difficult economic conditions "has gone through various business cycles and managed to come out stronger each time." cdll "Given our minimal debt, large inventory (P7.8 billion at cost and not yet at selling price), experienced management, and marketing strength, we are confident that we will overcome these short-term difficulties," Roco said.