..

Scptembel' 14, 2015

M;irkets and Securities Regulation Deparlment

Securities and Exchange Commission
SEC Building, EDSA
Greenhills, Mandaluyong City

Attention: Mt. Vicente Graciano P. Felizmenio, Jr.

Director

Cc: Corpora to Governance and Finance Department

Re: DMCl Project Developers, Inc.

Registration Statement filed in respect of
.i;rt,000,000,000 Fixed Rate Bonds

Gentlemen:

We refer to your letter dated September 9, 2015 (the "SEC Letter") in

relation to the Registration Statemen t filed by our clien t, DMCJ Project
Developers, Inc. (th e "Compan y") for the proposed regisll·ation and offering to
the public of fixed rate bonds with an aggrega te principal amom1t of up to
Pl,000,000,000. The SEC Letter required the Company to submit within ten (10)
days from receipt of the said letter an Amended Man ua l on Corporate
Governance ("Amended Manual") "providing a policy on the remuneration of
d irectors and officers to enhance compl iance with the d isclosu l'e rcquil"emcnt of
all fixed and variable compensa tion that are paid, directly or ind irectly, to all its
dil'ectors and top foux (4) management officers during the p receding fiscal year."

In compliance therewitll, we hereby submit on beha lf of our cl ient, a copy

of the Company's Amended Manual, Section 3.2.6 (p. 9) of which was modified
by the Board of Directors on September 10, 2015 to read as follows:

Sectio11 3.2.6 Re1111111er11tio11 of Directors 1111d Officers

Tiie levels of re11111tterntio11 of the Co111p1111y sltoulci be wfficient to be nble

lo nt.h·ncl nnd ret11i11 t/1e semices of qualified 1111rl co111pete11t directors n11d
officers. A portion of the re1111111erntio11 of executive direclors mny lie
slr11ch1red or lie /111sed 0 11 corpom te n11d i111/ivid11nl pe1formm1ce.
 ,
2
-·
T/1e Company's a111111a/ reports amt a11y i11for111ntio11 n11rf proxy
stale111e11ts as may lie requirer/ of l/1e Compm1y 11111/er n11pl1cal1/e laws
n11rl rcg11latio11s s/1111/ r.1mtai11 a clear, concise nrrrf 1111dersln11dnble
disc/os11re of all fixerf n11d w1rin/Jle co111pe11snlio11 I/int 111ny lie paid,
dirc'ctly or iudirccfly, to its d1reclors m11f lop (4) 111mingl'll1errt officers, i11
tile 11ggregale, rf11ri11g Ilic l'recerfi11g fisml year.

We hope that the enclosed Amended Manual already fully complies with
the requiremen ts of the Revised Code of Corporate Governance.

Tha nk you very much.

Very truly yours,

CASTILLO LAMAN TAN PANT A LEON & SAN JOSE

By:
 II DMCI '11
HOMES {
.; !l
•

Feel\· 1t•a/ K{)(J(/ to be Imme

Amended Manual on
Corporate Governance
September 2 015
The Board of Directors and Management of DMCI Project Developers, Inc.
hereby commit themselves t o the principles and best practices contained in
this Manual, and acknowledge that the same shall serve as a guide in the
attainment of their corporate goals.

1. OBJECTIVE

This Manual shall Institutionalize the p1inclples of good corporate governance in the
entire organization.

The Board of Directors and Management believe that corporate governance is one of
the necessary components of what constitute sound business management. In this
regard, Management shall undertake the necessary effort to create corporate
governance awareness within the organization as soon as possible.

2. DEFINffiON OF TERMS

For the purpose of this Manual, words importing the singular also include the plural
and the masculine includes the feminine and the neuter and vice versa where the
context requires. The technical terms used in this Manual shall have the respective
meanings as set forth below:

Board or Board of Directors -the governing body elected by the stockholders that
exercises the corporate powers of the Company, conducts all its business and controls
its properties

Chairman - refers to the person duly elected by the members of the Board of
Directors to preside over Board meetings and other duties and responsibilities listed
under the Company's By-laws.

Corporate Governance - the framework of rules, systems and processes in the

Company that governs the performance by the Board of Directors and Management of
their respective duties and responslbllftles to the stockholders and other stakeholders
which include, among others, customers, employees, suppliers, financiers, government
and community in which It operates.

Company- refers to DMCI Project Developers, Inc.

Code - refers to the Revised Code of Corporate Governance issued by the SEC and as
may be amended by the SEC from time to time.

Director - refers to a person duly elected by stockholders in the Board.

Executive Director - a director who is also the head of a department or unit of the
Company or performs any work related to its operation.

Internal Control - the systems established by the Board of Directors and

Management for the accomplishment of the Company's objectives, the efficient
operation of its business, the reliability of its financial repo1tlng, and faithful
compliance with the applicable laws, regulations and internal rules.

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 Independent Director - a person who, apart from his fees and shareholdings, is
independent of management ancJ free from any business or other relationship which
could reasonably be perceived to, materially interfere with his exercise of Independent
judgment in carrying out his responsibilities as a director.

Internal Control - the systems established by t he Board of Directors and

Management for the accomplishment of the Company's objectives, the efficient
operation of its business, the reliability of its financial reporting, and faithful
compliance with the applicable laws, regulations and internal rules.

Internal Control System - the framework under which internal controls are
developed and implemented to manage and control a particular risk or business
activity, or combination of risks or business activities, to which the Company is
exposed.

Internal Audit - an independent and objective assurance activity designed to add

value to and improve the Company's operations, and help it accomplish its objectives
by providing a systematic and disciplined approach in the evaluation and improvement
of the effectiveness of risk management, control and governance processes.

Internal Audit Department - refers to an organic unit of the Company that

provides independent, objective assurance and consulting services designed to review
the implementation of the Internal Control.

Management - refers to the body given the authority by the Board of Directors to
implement the policies it has laid down in the conduct of the business of the Company.

Non-executive Director - a director who is not the head of a department or unit of

the Company nor performs any work related to its operation.

Non-audit work - the other services offered by an external auditor to a corporation

that are not directly related and relevant to its statutory audit functions, such as,
accounting, payroll, bookkeeping, reconciliation, computer project management, data
processing, or information technology outsourcing services, internal audit, and other
services t hat may compromise the independence and objectivity of an external
auditor.

Manual - refers to this Manual on Corporate Governance.

SEC - refers to the Securities and Exchange Commission.

3. BOARD GOVERNANCE

The Board of Directors is primarily responsible for the governance of the Company.
Corollary to setting t he policies for the accomplishment of the corporate objectives, it
shall provide an independent check on Management.

3.1 Composition of the Board

The Company's Board shall be composed of nine (9) directors, two (2) of which
are independent directors, who are elected by the stockholders.

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 The membership of the Board may be a combination of executive and non-
executive directors {which include t he independent directors) in order that no
director or small group of directors can dominate the decision-making process.

The non-executive directors should posses such qualifications and stature that
would enable them to effectively participate in the deliberations of the Board.

3.1.1 Chairm an and CEO

The roles of the Chairman and the Chief Executive Officer ("CE0'1 should, as
much as practicable, be separate, to foster an appropriate balance of power,
increased accountability and better capacity for independent decision making
by the Board. A clear delineation of the functions between the Chairman and
the CEO shall be made upon their election.

If the positions of the Chairman and CEO are unified, proper checks and
balances shall be laid down to ensure that the Board gets the benefit of
independent views and perspectives.

The duties and responsibilities of the Chairman in relation to the Board may
include, among others, the following:

{i) Ensure that the meetings of the Board are held In accordance with the
Company's By-laws or as the Chair may deem necessary;
(ii) Supervise the preparation of the agenda of the meeting in coordination
with the Corporate Secretary, taking into consideration the suggestions
of the CEO, Management and the directors; and
(iii) Maintain qualitative and timely lines of communication and information
between the Board and Management.

3.2 Board of Directors

Compliance with the principles of good corporate governance shall start with
the Board.

It shall be the Board's responsibility to foster the long-term success of the

Company and secure its sustained competitiveness in a manner consistent with
its fiduciary respcnsibility, which It shall exercise in the best interest of the
Company, its stockholders and other stakeholders. The Board shall conduct
Itself with utmost honesty and integrity in the discharge of its duties, fu nctions
and responsibilities.

3.2.1 General Responsibility of a Director

It Is the Board's respcnsibillty to foster the long term success of the

Company, and to sustain its competitiveness and profitability in a
manner consistent with its corporate objectives and the best interests
of Its stockholders and other stakeholders.

The Board should formulate the Company's vision, mission, strategic

objectives, policies and procedures that shall guide Its activities,
including the means to effectively monitor Management's performance.

3.2. 2 Specific Duties and Functions of t he Board

To ensure a high standard of best practice for the Company, its
stockholders and stakeholders, the Board should conduct itself with
honesty and Integrity in the performance of, among others, the
following duties and functions:

a) Implement a process for the selection of directors who

can add value and contribute independent judgment to the
formulation of sound corporate strategies and policies. Appoint
competent, professional, honest and highly-motivated
management officers. Adopt an effective succession planning
program for Management.

b) Provide sound strategic policies and guidelines to the

Company on major capital expenditures. Establish programs that
can sustain its long-term viability and strength. Periodically
evaluate and monitor the implementation of such policies and
strategies, including the business plans, operating budgets and
Management's overall performance.

c) Ensure the Company's faithful compliance with all

applicable laws, regulations and best business practices.

d) Establish and maintain an investor relations program that

will keep the stockholders Informed of important developments in
the Company. If feasible, the Company's CEO or chief financial
officer shall exercise oversight responsibility over this program.

e) Identify the Company's stakeholders in the community in

which the Company operates or are directly affected by its
operations, and formulate a clear policy of accurate, timely and
effective communication with them.

f) Adopt a system of check and balance within the Board. A

regular review of the effectiveness of such system should be
conducted to ensure the integrity of the decision-making and
reporting processes at all times. There should be a continuing
review of the Company's internal control system in order to
maintain its adequacy and effectiveness.

g) Identify key risk areas and performance indicators and

monitor these factors with due diligence to enable the Company
to anticipate and prepare for possible threats to its operational
and financial viability.

h) Formulate and implement policies and procedures that

would ensure the Integrity and transparency of related party
transactions between and among the Company and its parent
company, joint ventures, subsidiaries, associates, affiliates, major
stockholders, officers and directors, Including their spouses,
children and dependent siblings and parents, and of Interlocking
director relationships by members of the Board.

5
,•

I) Constitute an Audit Committee and such other

committees it deems necessary to assist the Board in the
perfonnance of its duties and responsibilities.

j) Establish and maintain an alternative dispute resolution

system in the Company that can amicably settle conflicts or
differences between the Company and its stockholders, and the
Company and third parties, including the regulatory authorities.

k) Meet at such ti mes or frequency as may be needed. The

minutes of such meetings should be duly recorded. Independent
views during Coard meetings should be encouraged and given
due consideration.

I) Keep the activities and decisions of the Board within its

authority under the Company's Artides of Incorporation and By-
laws, and in accordance with existing laws, rules and regulations.

m) Appoint a Compliance Officer who shall have the rank of

at least vice president. In the absence of such appointment, the
Corporate Secretary, preferably a lawyer, shall act as Compliance
Officer.

3.2.3 Dut.i es and Responsibilities of a Director

A Director's office Is one of trust and confidence. A director should act

in the best Interest of the Company in a manner characterized by
transparency, accountability and fairness. He should also exercise
leadership, prudence and integrity in directing the Company towards
sustained progress.

A Director should observe the following nonns of conduct:

• Conduct fair business transactions for the Company and ensure that
his personal interest does not conflict with the Interests of the
Company;

• Devote time and attention necessary to properly and effectively

perform his duties and responslblllties;

• Act judiciously;

• Exercise independent judgment;

• Have a working knowledge of the statutory and regulatory

requirements that affect the Company, including Its Articles of
I ncorporation and By·Laws, the rules and regulations of the SEC,
and where applicable, the requirements of relevant regulatory
agencies.

• Observe confldentlallty;

• Ensure the continuing soundness, effectiveness and adequacy of

the Company's Internal control system.

6
3.2.4 Qualifications of Directors

• Holder of at least one (1) share of stock of the Company;

• He shall be at least a college graduate or have sufficient

experience in managing the business to substitute for such
formal education;

• He shall be at least thirty (30) years old;

• He shall have worked or in business for at least six (6) years

and held a position not less than managerial level;

• He shall have proven to possess integrity and probity; and

• He shall be assiduous.

Disqualifications

As provided in the Code, the following shall be grounds for

permanent disqualification of a director:

(i) Any person convicted by final judgment or order by a

competent judicial or administrative body of any crime that (a)
involves the purchase or sale of securities, as defined in the
Securities Regulation Code; (b) arises out of the person's
conduct as an underwriter, broker, dealer, investment adviser,
principal, distributor, mutual fund dealer, futures commission
merchant, commodity trading advisor, or floor broker; or (c)
arises out of his fiduciary relationship with a bank, quasi-bank,
trust company, investment house or as an affiliated person of
any of them ;

(ii) Any person who, by reason of misconduct, after hearing,

is permanently enjoined by a final judgment or order of the SEC
or any court or administrative body of competent j urisdiction
from : (a) acting as underwriter, broker, dealer, investment
adviser, principal distributor, mutual fund dealer, futures
commission merchant, commodity trading advisor, or floor
broker; (b) acting as director or officer of a bank, quasi-bank,
trust company, investment house, or Investment company; (c)
engaging in or continuing any conduct or practice in any of the
capacities mentioned in sub-paragraphs (a) and {b) above, or
willfully violating the laws that govern securities and banking
activities.

The disqualification shall also apply if such person is

currently the subject of an order of the SEC or any court or
administrative body denying, revoking or suspending any
registration, license or permit issued to him under the
Corporation Code, Securities Regulation Code or any other law
administered by the SEC or Bangko Sentral ng Pilipinas ("BSP"),

7
or under any rule or regulatlon issued by the SEC or BSP, or has
otherwise been restrained to engage in any activity Involving
securities and banking; or such person Is currently the subject
of an effective order of a self-regulatory organization
suspending or expelling him from membership, participation or
association with a member or participant of the organization;

(Ill) Any person convicted by final judgment or order by a

court or competent admlnistratlve body of an offense Involving
moral turpitude, fraud, embezzlement, theft, estafa,
counterfeiting, misappropriatlon, forgery, bribery, false
affirmation, perjury or other fraudulent acts;

(iv) Any person who has been adjudged by final j udgment or

order of the SEC, court, or competent administrative body to
have willfully violated, or willfully aided, abetted, counseled,
induced or procured the violatlon of any provision of the
Corporation Code, Securitles Regulation Code or any other law
administered by the SEC or BSP, or any of its rule, regulation or
order;

(v) Any person earlier elected as independent director who

becomes an officer, employee or consultant of the same
Company;

(vi) Any person judlclalty declared as insolvent;

(vii) Any person found guilty by final judgment or order of a

fore.ign court or equivalent financial regulatory authority of acts,
violations or misconduct similar to any of the acts, violations or
misconduct enumerated In sub-paragraphs (i) to (v) above;

(viii) Conviction by final judgment of an offense punishable by

Imprisonment for more than six (6) years, or a violation of the
Corporation Code committed wltl1ln five (5) years prior to the
date of his election or appointment.

Any of the following shalt be a ground for the temporarv

disqualification of a director:

• Refusal to comply with the disclosure requirements of the

Securities Regulation Code and Its Implementing Rules and
Regulatlons. The disqualification shall be In effect as long as
the refusal persists;

• Absence In more than fifty percent (50%) of all regular and

special meetings of the Board during his Incumbency, or any
twelve-(12) month period during the said Incumbency,
unless the absence Is due to Illness, death In the Immediate
family or serious accident. The disquallficatlon shall apply
for purposes of the succeeding election;

8
 • Dismissal or termination for cause as director of any
corporation covered by the Code. This disqualification shall
be in effect until he has cleared himself from any
involvement in the cause that gave rise to his dismissal or
termination.

• If any of the judgments or orders cited in the grounds for

permanent disqualification has not yet become final.

A temporarily disqualified director shall, within sixty (60)

business days from such disqualification, take the appropriate
action to remedy or correct the disqualification. If he fails or
refuses to do so for unjustified reasons, the disqualification shall
become permanent.

3.2.5 Board Meetings and Quorum Requirement

The members of the Board should attend its regular and special
meetings in person or through teleconferencing conducted in
accordance with the rules and regulations of the SEC.

Independent directors should always attend board meetings.

Unless otherwise provided in the by-laws, their absence shall not affect
the quorum requirement. However, the Board may, to promote
transparency, require the presence of at least one independent director
In all its meetings.

3.2.6 Remuneration of Directors and Officers

The levels of remuneration of the Company should be sufficient

to be able to attract and retain the services of qualified and competent
directors and officers. A portion of the remuneration of executive
directors may be structured or be based on corporate and individual
performance.

The Company's annual reports and any information and proxy

statements as may be required of the Company under applicable laws
and regulations shall contain a clear, concise and understandable
disclosure of all fixed and variable compensation that may be paid,
directly or indirectly, to its directors and top (4) management officers,
in the aggregate, during the preceding fiscal year. (Amended as of
September 10, 2015)

4. BOARD COMMllTEES

The Board shall constitute the proper committees to assist it in good corporate
governance.

4.1 Nomination and Election Committee

The Nomination Committee shall have at least three (3) Directors.

9
 lt shall pre-screen and shortlist all candidates nominated to become a
member of the Board of Directors in accordance with the qualifications
and disqualifications set forth in Section 3.2.4 of this Manual.

4.1.1 In consultation with the Board, review and re- define, as appropriate,
the role, duties and responsibilities of the CEO by Integrating the
dynamic requirements of the business as a going concern and future
expansionary prospects within the realm of good corporate governance
at all times.

4.1.2 The CEO and other executive directors shall submit themselves to a low
indicative limit on membership in other corporate Boards. The same
low limit shall apply to independent, non-executive directors who serve
as full-time executives in other corporations. In any case, the capacity
of directors to serve with diligence shall not be compromised.

4.1.3 The Nomination Committee shall consider the following guidelines in

determining the number of directorships for the members of the Board:

• The nature of the business of the Company;

• Age of the director;

• Number of directorships/active memberships and officerships in

other corporations or organizations; and

• Possible conflict of interest.

The optimum number shall be related to the capacity of a director to

perform his duties diligently in general.

4 .2 Compe nsation and Remunerati on Committee

The Compensation or Remuneration Committee shall be composed of at least

three (3) members, one of whom shall be an independent director.

4.2.1 Duties and Responsibilities

• Establish a formal and transparent procedure for developing a policy

on executive remuneration and for fixing the remuneration
packages of corporate offlcers and directors, and provide oversight
over remuneration of senior management and other key personnel
ensuring that compensation is consistent with the Company's
culture, strategy and control environment.

• Designate amount of remuneration, which shall be in a sufficient

level to attract and retain directors and officers who are needed to
run the Company successfully.

• Establish a formal and transparent procedure for developing a policy

on executive remuneration and for fixing the remuneration
packages of Individual directors, if any, and officers.

10
 • Develop a form on Full Business Interest Disclosure as part of the
pre-employment requirements for all incoming officers, which
among others compel all officers to declare under the penalty of
perjury all their existing business interests or shareholdings that
may directly or indirectly conflict in their performance of duties once
hired.

• Disallow any director to decide his or her own remuneration.

• Provide in the Company's annual reports, information and proxy

statements a clear, concise and understandable disclosure of
compensation of Its executive officers for the previous fiscal year
and ensuing year.

• Review of the existing administration or personnel to strengthen

provisions on conflict of interest, salaries and benefits policies,
promotion and career advancement directives, and compliance of
personnel concerned with all statutory requirements that must be
periodically met in their respective posts.

4.3 Audit Committee

The Audit Committee shall be composed of at least three (3) members

of the Board. Each member shall have adequate understanding at least
or competence at most of the Company's financial management
systems and environment.

4.3.1 Functions of the Audit Committee

The Audit Committee shall have the following functions:

a) Assist the Board in the performance of its oversight responsibility for

the financial reporting process, system of internal control, audit
process, and monitoring of compliance with applicable laws, rules
and regulations;

b) Provide oversight over Management's activities in managing credit,

market, liquidity, operational, legal and other risks of tne Company.
This function shall include regular receipt from Management of
information on risk exposures and risk management activities;

c) Perform oversight functions over the Company's internal and

external auditors. It should ensure that the internal and external
auditors act independently from each other, and that both auditors
are given unrestricted access to all records, properties and
personnel to enable them to perform their respective audit
functions;

d) Review the annual internal audit plan to ensure its conformity with
the objectives of the Company. The plan shall include the audit
scope, resources and budget necessary to implement it;

e) Prior to the commencement of the audit, discuss with the external

auditor the nature, scope and expenses of the audit, and ensure

ll
 proper coordination if more than one audit finn is involved in the
activity to secure proper coverage and minimize duplication of
efforts;

f) Organize an internal audit department, and consider the

appointment of an independent internal auditor and the terms and
conditions of its engagement and removal;

g) Monitor and evaluate the adequacy and effectiveness of the

Company's Internal control system, including financial reporting
control and lnfonnatlon technology security;

h) Review the reports submitted by the internal and external auditors;

i) Review the quarterly, half-year and annual financial statements

before their submission to the Board, with particular focus on the
following matters:

Any change/s in accounting policies and practices

Major judgmental areas
Significant adjustments resulting from the audit
Going concern assumptions
Compliance with accounting standards
Compliance with tax, legal and regulatory requirements.

j) Coordinate, monitor and facilitate compliance with laws, rules and

regulations;

k) Evaluate and determine the non-audit work, if any, of the external

auditor, and review periodically the non-audit fees paid to the
external auditor in relation to their significance to the total annual
income of the external auditor and to the Company's overall
consultancy expenses. The Audit Committee shall disallow any non-
audit work that will conflict with his duties as an external auditor or
may pose a threat to his independence. The non-audit work, if
allowed, should be disclosed in the Company's annual report;

I) Establish and identify the reporting line of the Internal auditor to

enable him to properly fulfill his duties and responslbllltles. He shall
functionally report directly to the Audit Committee.

The Audit Committee shall ensure that, in the perfonnance of the work
of the internal auditor, he shall be free from interference by outside
parties.

5. THE CORPORATESECRETARY
The Corporate Secretary, who should be a Filipino citizen and a resident of the
Philippines, is an officer of the Company. He should -

(I) Be responsible for the safekeeping and preservation of the integrity of

the minutes of the meetings of the Board and its committees, as well as
the other official records of the Company;

12
 {II) Be loyal to the mission, vision and objectives of the Company;

(iii) Work fairly and objectively with the Board, Management, stockholders
and other stakeholders;

(iv) Have appropriate administrative and interpersonal skills;

(v) If he is not at the same time the Company's legal counsel, be aware of
the laws, rules and regulations necessary in the performance of his duties
and responsibilities;

(vi) Have a working knowledge of the operations of the Company;

(vii) Inform the members of the Board, in accordance with the Company's By-
laws, of the agenda of their meetings and ensure that the members
have before them accurate information that will enable them to arrive
at intelligent decisions on matters that require their approval;

(viii) Attend all Board meetings, except when justifiable causes, such as,
illness, death in the immediate family and serious accidents, prevent him
from doing so;

(ix) Ensure that all Board procedures, rules and regulations are strictly
followed by its members; and

(x) If he is also the Compliance Officer, perform all the duties and
responsibilities of the said officer as provided for in the Code.

6. COMPLIANCE OFFICER

The Board shall appoint a Compliance Officer who shall report directly to the Chairman
of the Board. He shall hold the position of a Vice President or its equivalent. He shall
have direct reporting responsibilities to the Chairman.

He shall perform the following duties:

(i) Monitor compliance by the Company with the Code, this Manual and the
rules and regulations of regulatory agencies and, if any violations are
found, report the matter to the Board and recommend the Imposition of
appropriate disciplinary action on the responsible parties and the
adoption of measures to prevent a repetition of the violation;

(ii) Identify and monitor compliance with the rules and regulations of
regulatory agencies, and take appropriate corrective measures to address
all regulatory issues and concerns;

(iii) Appear before the SEC when summoned In relation to compliance with
the Code;

(iv) Issue a certification every January 30th of the year on the extent of the
Company's compliance with the Code for the completed year and, if there
arc any deviations, explain the reason for such deviation; and

13
..

(v) Prepare and submit to the SEC all reports or disclosures required under
the Code;

7. ADEQUATE AND TIMELY INFORMATION

To enable the members of the Board to properly fulfill their duties and responsibilities,
Management should provide them with complete, adequate and timely information
about the matters to be taken in their meetings.

Reliance on Information volunteered by Management would not be sufficient in all

circumstances and further inquiries may have to be made by a member of the Board
to enable him to properly perform his duties and responsibilities. Hence, the members
should be given independent access to Management and the Corporate Secretary.

The information may include the background or explanation on matters brought

before the Board, disclosures, budgets, forecasts and Internal financial documents.

The members, either individually or as a Board, and In furtherance of their duties and
responsibilities, should have access to independent professional advice at the
Company's expense.

8. ACCOUNTABILITY AND AUDIT

A. The Board is primarily accountable to the stockholders. It should provide a

balanced and comprehensible assessment of the Company's performance, position
and prospects on a quarterly basis, including interim and other reports that could
adversely affect its business, as well as reports to regulators that are required by
law.

Thus, it is essential that Management provide all members of the Board with
accurate and timely information that would enable the Board to comply with its
responsibilities to the stockholders.

Management should formulate, under the supervision of the Audit Committee, the
rules and procedures on financial reporting and internal control in accordance with
the following guidelines:

(i) The extent of its responsibility in the preparation of the financial

statements of the Company, with the corresponding delineation of the
responsibilities that pertain to the external auditor, should be clearly
explained;

(Ii) An effective system of internal control that will ensure the integrity of the
financial reports and protection of the assets of the Company for the
benefit of all stockholders and other stakeholders;

(iii) On the basis of the approved audit plans, internal audit examinations
should cover, at the minimum, the evaluation of the adequacy and
effectiveness of controls that cover the Company's governance,
operations and information systems, including the reliability and Integrity
of financial and operational information, effectiveness and efficiency of
operations, protection of assets, and compliance with contracts, laws,
rules and regulations;

14
 (iv) The Company should consistently comply with the financial reporting
requirements of the SEC;

(v) The external auditor should be rotated or changed every five (5) years or
earlier, or the signing partner of the external auditing firm assigned to
the Company, should be changed with the same frequency. The internal
auditor should submit to the Audit Committee and Management an
annual report on the internal audit department's activities, responsibilities
and performance relative t o the audit plans and strategies as approved
by the Audit Committee. The annual report should include significant risk
exposures, control issues and such other matters as may be needed or
requested by the Board and Management. The internal auditor should
certify that he conducts his activities in accordance with the International
St andards on the Professional Practice of Internal Auditing. If he does
not, he shall disclose to the Board and Management the reasons why he
has not fully complied with the said standards.

B. The Board, after consultations with the Audit Committee, shall recommend to the
stockholders an external auditor duly accredited by the SEC who shall undertake
an independent audit of the Company, and shall provide an objective assurance on
the manner by which the financial statements shall be prepared and presented to
the stockholders. The external auditor shall not, at the same time, provide internal
audit services to the Company. Non-audit work may be given to the external
auditor, provided it does not conflict with his duties as an independent auditor, or
does not pose a threat to his independence.

If the external auditor resigns, Is dismissed or ceases to perform his services, the
reason/s for and the date of effectivlty of such action shall be reported in the
Company's annual and current reports. The report shall include a discussion of any
disagreement between him and the Company on accounting principles or
practices, financial disclosures or audit procedures which the former auditor and
the Company failed to resolve satisfactorily. A preliminary copy of the said report
shall be given by the Company to the external auditor before its submission.

I f the external auditor believes that any statement made in an annual report,
information statement or any report filed with the SEC or any regulatory body
during the period of his engagement is incorrect or incomplete, he shall give his
com ments or views on the matter in the said reports.

c. External Auditor

i. An external auditor shall enable an environment of good corporate governance

as reflected In the financial records and reports of l'he Company. An external
auditor shall be selected and appointed by the stockholders upon
recommendation of the Audit Committee.

ii. The reason/s for the resignation, dismissal or cessation from service and the
date thereof of an external auditor shall be reported in the Company's annual
and current reports. Said report shall include a discussion of any
disagreement with said former external auditor on any matter of accounting
principles or practices, financial statement disclosure or auditing scope or
procedure.

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 iii. The external auditor of the Company shall not at the same time provide the
services of an internal auditor. The Company shall ensure that other non-
audit work shall not be in conflict with the functions of the external auditor.

iv. The external auditor shall be rotated or the handling partner shall be changed
every five (5) years or earlier.

v . If an external auditor believes that the statements made in the Company's

annual reports, information statement or proxy statement filed during
engagement is Incorrect or Incomplete, he shall qualify his views In said
reports.

Under the superv1s1on of the Audit Committee, the internal auditor should
formulate the rules and procedures on financial reporting and internal control.

o. Internal Auditor

i. The Company shall have in place an independent internal audit function which
shall be performed by an internal auditor or a group of internal auditors,
through which its Board, senior management and stockholders shall be
provided with reasonable assurance that Its key organizational and procedural
controls remain effective and appropriate, and are complied with.

Ii. The internal auditor shall report to the Audit Committee.

iii. The minimum internal control mechanisms for management's operational

responsibility shall center on the CEO, being ultimately accountable for the
Company's organizational and procedural controls.

iv. The scope and particulars of a system of effective organizational and

procedural controls shall be based on the following factors: the nature and
complexity of business and the business culture; the volume, size and
complexity of transactions; the degree of risk; the degree of centralization and
delegation of authority; the extent and effectiveness of Information
technology; and the extent of regulatory compliance.

9. COMMUNICATION PROCESS

9.1 This Manual shall be available for inspection by any stockholder of the Company at
reasonable hours on business days.

9.2 All directors and the Management are tasked to ensure the thorough dissemination
of this Manual to all employees and related third parties, and to likewise enjoin
complfance in the process.

9.3 An adequate number of printed copies of this Manual must be reproduced with a
minimum of at least one (1) hard copy of the Manual per department of the
Company.

10. TRAINING PROCESS

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 10.1 If necessary, funds shall be allocated by the Treasurer or its equivalent officer
for the purpose of conducting an orientation program or workshop to
operationalize this Manual.

11 STOCKHOLDERS' RIGHTS AND PROTECTION OF MINORITY STOCKHOLDERS'

INTEREST

A. The Board shall respect the rights of the stockholders as provided for in the
Corporation Code; namely:

(i) Right to vote on all matters that require their consent or approval

(ii) Pre-emptive right to all stock issuances of the Company

(iii) Right to Inspect corporate books and records

(iv) Right to information

(v) Right to dividends

(vi) Appraisal right

B. The Board should be transparent and fair in the conduct of the annual and special
stockholders' meetings of the Company. The stockholders should be encouraged
to personally attend such meetings. If they cannot attend, they should be apprised
ahead of time of their right to appoint a proxy. Subject to the requirements of the
Company's By-laws, the exercise of that right shall not be unduly restricted and
any doubt about the validity of a proxy should be resolved in the stockholder's
favor.

It Is the duty of t he Board to promote the rights of the stockholders, remove

impediments to the exercise of those rights and provide an adequate avenue for
them to seek timely redress for breach of their rights.

The Board should take the appropriate steps to remove excessive or unnecessary
costs and other administrative impediments to the stockholders' meaningful
participation in meetings, whether in person or by proxy. Accurate and timely
information should be made available to the stockholders to enable them to make
a sound j udgment on all matters brought to their attention for consideration or
approval.

Although all stockholders should be treated equally or without discrimination, the

Board should give minority stockholders the right to propose the holding of
meetings and the items for discussion in the agenda that relate directly to the
business of the Company.

12. DISCLOSURE AND TRAN SPARENCY

The essence of corporate governance Is transparency. The more transparent the

Internal workings of the Company are, the more difficult it will be for Management and
dominant stockholders to mismanage the Company or misappropriate its assets.

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 It Is therefore essential that all material information about the Company which could
adversely affect its viability or the interest of its stockholders and other stakeholders
should be publicly and timely disclosed. Such information should include, among
others, earnings results, acquisition or disposition of assets, off balance sheet
transactions, related party transactions, and direct and indirect remuneration of
members of the Board andManagement.

1 3. COMMITMENT TO GOOD CORPORATE GOVERNANCE

As part of the Company's commitment to corporate governance, it shall establish and

implement its corporate governance rules in accordance with the Code. This Manual
shall be submitted to the SEC to enable the SEC to determine the Company's
compliance with the Code, taking into consideration the nature, size and scope of
business of the Company.

This Manual shall be available for inspection by any stockholder of the Company at
reasonable hours on business days.

14. MONITORING AND ASSESSMENT

• Each Committee shall report regularly to the Board.

• The Compliance Officer shall establish an evaluation system to determine and

measure compliance with this Manual. Any violation thereof shall subject the
responsible director, officer or employee to the penalty provided under Part 15 of
this Manual.

• The establishment of such evaluation system, including the features thereof, shall
be disclosed in such form of report that is applicable to the Company. The
adoption of such performance evaluation system must be covered by a Board
approval.

• This Manual shall be subject to quarterly review unless the Board amends the
same earlier.

• All business processes and practices being performed within any department or
business unit of Company that are not consistent with any portion of this Manual
shall be revoked unless upgraded to the compliant extent.

15. PENALTIES FOR NON-COMPLIANCE WITH THE MANUAL

• To strictly observe and implement the provisions of this Manual, the following
penalties shall be imposed, after notice and hearing, on the Company's directors,
officers, staff, subsidiaries and affiliat es and their respective directors, officers and
staff in case of violation of any of the provision of this Manual:

• In case of fi rst violation, the subject person shall be reprimanded.

• Suspension from office shall be imposed in case of second violation. The

duration of the suspension shall depend on the gravity of the violation.

• For third violation, the maximum penalty of removal from office shall be
imposed.

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 • The commission of a third violation of this Manual by any member of the Board of
the Company or its subsidiaries and affiliates shall be a sufficient cause for removal
from directorship.

• The Compliance Officer shill! be responsible for determining vlolation/s through

notice and hearing and shall recommend to the Chairman the Imposable penalty
for such violation, for further review and approval of the Board.

Signed:

£tle/~
NOEL A. LAMAN
Corporate Secretary / Compliance Officer

~#--
ALFREDO R. AUSTRIA
President
\Y--
September 10, 2015

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