In the Matter of Forum Pacific, Inc.

April 15, 2011 SEC-CFD ORDER NO. 090-11 IN THE MATTER OF FORUM PACIFIC, INC. ORDER Before this Commission is the March 24, 2011 Compliance filed by Forum Pacific, Inc. 1 ("Forum"), asking the Commission that the Order of Revocation dated October 1, 2009 be lifted after full payment of the penalties imposed amounting to Php2,553,700.00 and subsequent compliance with its reportorial obligations. Records of the Commission show that Forum's Registration and Permit to Sell Securities were revoked due to repeated violation of the SRC (Non-filing of (i) 2008 Annual Report, its 5th offense and (ii) 2009 1st Quarter Report, its 8th offense). On November 3, 2009 Forum filed a Petition to Lift Order of Revocation invoking the following: The company had no intention to violate the SRC; The negotiation for the sale of its subsidiary in the middle of the 4th Quarter of 2008 and 1st Quarter of 2009 caused the failure of the company to file its regular reports; The failure to file the 2008 Annual Report and 2009 1st Quarter Report was also due to the unfinished examination of its separate and consolidated Financial Statements for 2008 and Interim FS for 2009; That the failure was due to circumstances beyond the company's control; Petitioner is willing to pay the penalty of P40,000.00; Petitioner undertakes to submit the required Reports; aDECHI Petitioner undertakes to submit its reportorial requirements within the period prescribed under the SRC. CFD on January 11, 2010 recommended denial of the Petition based on the following grounds: 1. The company's registration was suspended on May 7, 2007, for 60 days due to late filing of its 2005 Annual Report, 2006 1st and 2nd Quarterly reports and for failure of the company to comply with the Commission's Order dated May 17, 2006. 2. During the period of suspension, the company again committed violations by filing late its 2006 Annual Report (its 4th offense) and 2007 1st Quarter report (6th violation) that led to the revocation of its registration. On January 24, 2008, the Commission en banc resolved to deny the company's request that it be allowed to pay monetary penalty in lieu of revocation and directed CFD to collect the penalties amounting to P1,234,000.00 and proceed with the revocation. On March 27, 2008, the Commission issued a resolution revoking Forum's Registration of Securities and Permit to Sell Securities. 3. Based on records, Forum has existing violations for non-submission of its 2008 Annual Report and 2009 1st Quarter Report and the company's continuous non-compliance with its reportorial obligations negates any favorable action from the Commission on the subject Petition to Lift Order of Revocation. The Commission on January 13, 2010 resolved to deny the Petition to Lift Order of Revocation and directed the company to pay the penalty of P40,000.00 for the late filing of its Current Report. After payment of the penalty on February 1, 2010 and submission of its SEC Form 17-Q for the 2nd and 3rd Quarters of 2009 on April 15 and 20, 2010, respectively, Forum Pacific, Inc. again committed the following violations: Non-filing of its 2009 Annual Report (6th offense) Non-filing of its 2010 1st Quarter Report (11th offense) Non-filing of its 2010 2nd Quarter Report (12th offense) Despite the show cause letters issued by CFD, the company failed to submit the required reports. As such, on August 19, 2010 CFD referred the matter to the Enforcement and Prosecution Department (EPD) for appropriate action. EPD directed Forum's Corporate Secretary and Board to submit within five (5) days from receipt of notice the company's 2009 Annual Report and its 1st & 2nd Quarterly Reports for 2010. After several extensions and a conference on October 12, 2010, EPD gave Forum a non-extendible period of three (3) days from receipt of the letter within which to submit the required reports. aATESD On January 14, 2011, Forum filed before EPD a Manifestation and Urgent Motion for Reconsideration and Motion to Lift the Order of Registration of the Registration of Securities and Permit to Sell Securities and to Hold in Abeyance any Enforcement and/or Administrative Action against it. On February 14, 2011, EPD issued an Order directing Forum to pay the penalty of P2,553,700.00 broken down as follows: 1. P2,210,200.00 as penalties for late filing of Annual Reports, Quarterly Reports, Current Reports and non-filing/late filing of GIS; 2. P43,500.00 for non-compliance with the Financial Reporting Requirements (SEC Memo Circular No. 8, S. of 2008); 3. Additional P300,000.00 for repetitive violation of Sections 17.1 and 17.2 in relation to SRC Rule 17.1 (1) (A)-(i), (ii), and (iii) and Sections 26 and 141 of the Corporation Code. Forum Pacific, Inc. paid the penalty of P2,553,700.00 on March 10, 2011 per Official Receipt No. 0541933. EPD then recommended the lifting of the Order of Revocation upon full payment of the penalties. On April 4, 2011 EPD furnished CFD a copy of the Compliance (dated March 24, 2011) submitted by Forum requesting that the Order of Revocation be lifted on the ground that it has complied with EPD's Order to pay monetary penalty in the amount of P2,553,700.00. On April 14, 2011, CFD recommended to the Commission en banc the lifting of the Order of Revocation of Registration and Permit to Sell Securities issued against Forum Pacific, Inc. for the sake of its 995 1 stockholders that were affected by the revocation and upon consideration of the full payment of the penalties imposed and subsequent compliance by the company of its reportorial obligations. WHEREFORE, in view of the full payment of the penalties imposed and subsequent compliance with its reportorial obligations, the October 1, 2009 Order of Revocation against FORUM PACIFIC, INC., is hereby LIFTED. SO ORDERED. EDSA, Mandaluyong, April 15, 2011. (SGD.) JUSTINA F. CALLANGAN Acting Director Footnotes 1. Filed with the Enforcement and Prosecution Department on March 28, 2011. 1. As of December 31, 2010.