Mr. Ernesto S. Alcantara

March 15, 1982 Mr. Ernesto S. Alcantara 128 Brookspoint St., Aurora Hill Baguio City Dear Mr. Alcantara: This has reference to your letter-query dated February 23, 1982 requesting information relative to the PAMANA Educational Plans, Inc. in connection with an offer made to you to organize a group or representatives in Baguio City and La Union Province to sell educational pre-needs plans of subject firm. LexLib In answer to your first query relative to the stability of said corporation, please be informed that its Balance Sheet as of June 30, 1981 on file with this Commission indicates that the company has P10.65 worth of current assets for every P1.00 current liability and P93.73 worth of total assets for every P1.00 total liability. Of the total assets, 99% has been funded by the stockholders and 1% has been borrowed from creditors. In reply to your second query, please be informed also that the SEC has granted to PAMANA Permit No. 0019 to sell P75 million worth of its educational pre-need plans to the public, after almost four (4) months of careful screening and review covering the financial, legal and actuarial aspects of the plans. Please note, however, that the permit does not in any way constitute an indorsement or recommendation by this Commission of the plans permitted to be offered for sale, to wit: . . . Every permit and any other statement, printed or otherwise, for public consumption, that makes reference to such permit shall clearly and distinctly state that the issuance thereof is only permissive and does not constitute a recommendation or endorsement of the securities permitted to be offered for sale . It shall be unlawful to make, or cause to be made, to any prospective purchaser any representation contrary to the foregoing. (Section 8, Revised Securities Act, BP Blg. 1674 ). Relative to your third and forth queries regarding the protection or guarantee that buyers have for their investments in case of a financial setback for the company and the party which will assume payment of the "future" costs of college education as promised by the company in case of financial reverses, please be informed that the SEC, in conjunction with other government agencies, does its best to protect the public. Hence, this Commission is very strict with its requirement of a Trust Fund; and in order to ensure delivery of the promised goods or services, the pre-need companies are required to place part of the proceeds of the sale in banks as trust funds where they earn income. The SEC also carefully studies the registration papers/statements, screens the financial papers and scrutinizes the actuarial studies. But it still cannot possibly and legally guarantee the public against financial setbacks of the company. Please be advised accordingly. Very truly yours, (SGD.) MANUEL G. ABELLO Chairman