In the Matter of Subic Bay Golf and Country Club, Inc.

May 25, 2009 SEC-CFD ORDER NO. 079-09 IN THE MATTER OF SUBIC BAY GOLF AND COUNTRY CLUB, INC. O R D E R The records on file with this Commission show that the Club committed the following violations: VIOLATION DATE DUE DATE FILED FREQUENCY OF PENALTY VIOLATION Late filing of 2007 Annual 4/15/08 12/10/08 1 1st reprimand Report (SEC Form 17-A); Failure to attach Audited Financial Statements for the year ended 12/31/07 Late filing of 2007 2nd Quarter 8/15/07 2 10/15/08 2nd P78,100.00 Report Late filing of 2007 3rd Quarter 11/14/07 10/15/08 3rd P261,600.00 Report Late filing of 2008 1st Quarter 5/15/08 12/10/08 4th suspension Report Late filing of 2008 2nd Quarter 8/15/08 12/10/08 5th suspension Report Late filing of 2008 3rd Quarter 11/14/08 12/10/08 6th suspension Report Non-filing of 2008 Information At least 25 Not filed 1st reprimand Statement business days before the 2008 Annual Stockholders' Meeting (per BL the ASM is any day in June) Non-filing of sworn certification 01/30/08 - 3rd P96,000.00 3 on the extent of the Club's compliance with its Manual on Corporate Governance for 2008. Non-filing of sworn certification 01/30/08 - 3rd P96,000.00 4 on the attendance of directors to the 2008 board meetings. Failure to attach to the 2008 04/15/09 - 2nd For issuance Annual Report (SEC Form 17-A) of Assessment the Audited Financial Statements letter for the year ended 12/31/08 TOTAL P531,700.00 5 =========== In addition, the Club was previously assessed penalties in the total amount of P219,000.00 for the following violations: VIOLATION DATE DUE DATE FILED FREQUENCY PENALTY OF VIOLATION Late filing of sworn certification 1/30/07 4/23/07 2nd P65,500.00 6 on the extent of the Club's compliance with its Manual on Corporate Governance for 2006. Late filing of sworn certification 12/31/06 3/01/07 2nd P53,500.00 7 on the attendance of directors to the 2006 board meetings. For engaging the services of an P100,000.00 external auditor who is not accredited by the Commission, in violation of SEC Memorandum Circular No. 13, Series of 2003. TOTAL P219,000.00 8 =========== It likewise failed to pay the fine imposed in the Order dated July 1, 2003 in the amount of P100,000.00. In spite of notice and demand, the Club has failed to submit the required reports and pay the assessed penalties. In a letter dated April 2, 2009 which the Commission received on April 15, 2009, the Club, through its President, sought reconsideration of the assessed penalties for the non-filing of the required sworn certifications raising the following justifications: The Club had no operation since it was taken over by SBMA in June 2007; and The Club premise's and golf course, facilities and equipment are operated by Hanafil Golf and Tour, Inc. It further reiterated its previous request to temporarily exempt it from complying with the reportorial requirements under the Securities Regulation Code. Pursuant to the Resolution of the Commission in its meeting on 20 May 2009, the Club's request for reconsideration of the penalties imposed on the non-filing of the required sworn certifications on the extent of its compliance with the Manual on Corporate Governance for the year 2008 and on the attendance of directors to the 2008 board meetings is hereby DENIED and its Registration of Securities and Certificate of Permit to Sell Securities to the Public are hereby SUSPENDED. The Commission further resolved to reduce the assessed penalties of Seven Hundred Fifty Thousand Seven Hundred Pesos (P750,700.00) 9 by 75%, or a total reduced penalty of One Hundred Eighty Seven Thousand Six Hundred Seventy-Five Pesos (P187,675.00). 10 The Club is hereby directed to pay within fifteen (15) days from the date of this Order the reduced penalty of One Hundred Eighty Seven Thousand Six Hundred Seventy-Five Pesos (P187,675.00) plus the P100,000.00 fine (Order dated July 1, 2003), or the total amount of Two Hundred Eighty Seven Thousand Six Hundred Seventy-Five Pesos (P287,675.00), by way of cash, Cashier or Manager's check. Should the company fail to submit the required reports and pay the reduced penalty of Two Hundred Eighty Seven Thousand Six Hundred Seventy-Five Pesos (P287,675.00) within the said period, the Commission shall immediately initiate proceedings for the revocation of its Registration of Securities and Certificate of Permit to Sell Securities to the Public. Let a copy of this Order be posted in the Commission's official website for the information and guidance of the public. SO ORDERED. Signed this 25th day of May 2009 at Mandaluyong City, Philippines. For the Commission: (SGD.) JUSTINA F. CALLANGAN Director Footnotes 1. With 2006 AFS attached. 2. On August 7, 2007, the Club informed the Department of its inability to file its 2nd Quarter Report because of SBMA's takeover of the Club's premises. 3. Computed as of date of assessment on 19 March 2009. 4. Computed as of date of assessment on 19 March 2009. 5. On November 17, 2008, the company requested a waiver of the P339,700 (P78,100.00 + P261,600.00) assessed penalty in view of SBMA's takeover of the Club's premises since June 2007. The company likewise requested consideration from the Commission to be temporarily discharged from filing the required reports under the SRC until it regains the golf course operation through a proper legal forum. 6. Computed per 2005 Consolidated Scale of Fines, as follows: P25,000 (basic penalty) + 500 (81 days of delay). 7. Computed per 2005 Consolidated Scale of Fines, as follows: P25,000 (basic penalty) + 500 (57 days of delay). 8. Upon the company's failure to pay the P219,000.00 penalty, the matter was calendared for a hearing for suspension on June 7, 2007. However, the Club's representative did not appear on the said date, despite due notice through receipt of the Notice of Hearing by an employee, Ms. Shirley Cruz, on June 6, 2007. 9. P531,700.00 + 219,000.00. 10. P750,700.00 * (100%- 75%).