2018 SRC Definitive 20-IS

COVER SHEET

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NOTICE OF REGULAR ANNUAL STOCKHOLDERS' MEETING

(!-..tTO OUR STOCKHOLDERS:

['oy

NOTICE lS HEREBY GIVEN that lhe regular annual meeting of the stockholders of SEAFRONT RESOURCES CORPORATION will be held at Rooms 527-528 YIAS, Level 5, Podium 4, RCBC Plaza, Ayala Cor. Sen. Gil J. Puyat Avenues, Makati City on Thursday, May 17, 20'18 at 1 :30 p.m. The order of business at said meeting will be as follows.

Certification of Service of Notice: Determinatron of Quorum/Call to Order 3. Approval of the I\,4 nutes of the last Stockholders Meeting held on 19 May 2017 Approval of lvlanagemeni Report and the 2017 Audited Financial Statements; 5. Confirmalion and Ratification of all acts, contracts and investments made and entered into by Management and/or Board of Directors during the period 19 May 2017 to 17 May 2018, 6. Election of Nine (9) members of the Board of Djrectors (including Independent Directors) for the year 2018-2019: 7. Appointment of Extefnal Auditors; B. Other l\,4atters; and Adjournment 1

2.

4

9

Please be advised that the record date of stockholders entitled to vote at sard meeting shall be 09 March 2018. Registration for the meeting shall commence at 1:00 p.m. on Thursday, lvlay 17, 20'18 at the above venue.

SEAFRONT RESOURCES CORPORATION

Sf, ATRONT

RSSOURCES CORPORATION JMT Buildin& ADB Avenue Ortigas Center, Parig City

7fr Floor,

637-2917 Telephone Number

3l

December 2017 Fiscal Year Endine

Notice of Regular Annurl Stockholders' Meethg

SEC Form 20-IS

InforErtion Strtcm€nt Pursurnt to S€ctioD 20 of tbc Sccurities Regulation Code Foim T'.pe

RATIONALE AND BRIEF DISCUSSION OF THE AGENDA OF THE 2OI8 ANNUAL STOCKHOLDER'S EETING. (THE "ANNUAL STOCKHOLDERS'MEETING'), Call to Ordot The Chajrman of the Board of Directors (or the Chairman of the meeting, as the case maybe) (the 'Chairman') will call the meeting to order.

2.

Detormination ot QuorumrRepod on Attendanco The Corporate Secretary (orthe Secretary ofthe meeting, as the case may b€) (the "Secretary") willcertify the date when the written notice ofthe Annual Stockholders' Meeting was sent to the stockholders as of the record date of March 09. 2018 and the date of oublication of the notice in the newspaperg ot geneGl circulation.

The Secretary will likewise cediry the presence of a quorum- Unde. the By-Laws of the Corporation (the "Corporation's By-Laws"), the holdeE of a majority of the issued and outstanding capital stock of the Corporation entitled to vote shall, if present in person or by proxy, constitute a quorum for the transaction of busine9s.

Votinq and Votino Procedure Section 5.0 of Article ll ofthe By-Laws ofthe Corporation provides that stockholders rnay vote at all me€tinga the number of shares registercd in theaa reapective names either in person or by proxy executed in writing. No proxy shall be recognized unless pres€nted to the Secretery for inspection and registration at least t6n ('10) calendar days beto.e the date of said me€iing.

ln the same vein, Section 24 of the Corporation Code of the Philippines provides that each stockholder may vote in any ofthe following manneri

1) 2) 3)

he/she may vote such number of sharos for as many persons as there are Directors to be elected; he/she may cumulate said share €nd give one candidate as many votes as the number of Directors to be elected multiplied by higher sharesi he/she may distribute them on the same pdnciple among as many candidates as he/she may see fit. ln any of these instances, the total number of votes cast by the stockholders should not exceed th€ number of shares owned by him/her as shown in the books ol the Corporation multiplied by the total number of Direclors to be elected.

The extemalauditor of the Corporation willbe requested to superviseth€ voting procedure.

Que8tion and Answer The Chairman ofthe meeting willadvise the stockholders of the holding of an open forum after the Menagement's Report was delivered by the President of the Corporation.

3.

App.ovd ofitu fllnuta! ofthc

l!!i

StoclholdcE lr.otirg h.ld on l0 t .y 20tt,

The Minutes of the meeting held on May 19,2017 are posted at the Ssafront Rssourc€s Corporation website, www seafrontresolrces.com.oh. Copies of which will also be dbtribul€d to tho stockholdgE b6io.e the me€ting.

Apploval of

t

anagcmcnt Rapod and tho 2Ot7 Audltad

Fh.ncl.l St tom.ntr.

Th€ Compeny's audited linanciel stiatemenb as of Decemb€r 31, 2017 is iniegrated and made pari of th6 Company's Information Sbtemsnt- The Intormation Statement wlll be sent to the stockholdeG at least fifreen ( 15) business days prior to th6 ASM, and the sam€ will b€ postod at lhe Company's website al wvvw seafrontresources.com.oh.

A resolutlon appovlng the Management Reporl and the 20'17 AudiEd Financial Statemgnb shall b€ pres€ntod to the stockholders for approval.

Th6 stockholders will be given lhe opportunity ic ask questons or raise concems.

Confmatlon rnd Ratttlcroon ol rll rctr, contr.c,lr .nd Involtmgntr mrdc rnd lntottd into by ]{.nrgcm.nt rnd Bo$d ot Dlircto.t durlng tho potlod 19 ry 20lt to l7 .y 201E.

The resolutions approved by the Board in its regular and special m€etings rsfar tc acb don6 by the goard, Co.porate Ofrce.s and Management in the ordinary cours€ ot business. Th€ Compsny also regularly discloses material transactions approved by ihe Board. Thes€ disclogureg are available ior vigwing and downloading at lhe Companfs webslt€ at www.seaf rcntesouaces.com.ph.

The stockholders will b€ requested b ratify all acls ot the Board of Dhocto.g end Management since ihe last stockholde.s' meeting in 201 7.

mombor! ol lhs Board ot Dlrlcto]! (lncluding Ind.pondont Dl|tctor!)

201&2019,

6. Electlon of Nlno

tor th.

y..t

(91

At its me€ting hgld on March 16, 2018, the Nomlnaton Commitiee, as the standing committee

of he Board gf Dir€ctg.s constituted br ths purpose of reviewing and evalualing

the

qualifications ol p€rsons nominated to b€come memb€rs ot ths Board of Oiractors (includlng lhe Independent dlrecto.s) and pursuant to the provbions of f|e CorporaG Govornance Manual ot thg Company and rul€s of the Nomination Committee, Gviewed the candilat6 br director to ensure that they haw all th€ qualifications and none ot the disqualifications ior nomination and eleclion aB members of ths Board of Direclo.a.

The nine (9) nominees will bg submitbd for €lec{ion to lhs Bosrd of Di.ectors by the stockholdeG at the Annual Stockholders' Meeting. The profiles of the nomin€€s arc provided in ths Dofinitivo Information Statement ior the Annual Stockholders' M€€iing.

7.

Appolntngnt of thr Comprny'! E.bm.l Audltor!.

The Company's Board Audit Cgmmitt€€ assess€d and gvsluated the performance for the previous year of the Company's extemal audabr, SYCIP GORRES VELAYO & CO. (SGV).

Based on the Board Audn Committee recommendation, the Board of Direc{ors will r€commsnd thg regppointment of SGV as the Company's ertemalauditor tur 201E.

SGV b

aE d tl|. bp eudling frtns in tha courty srd iE tuIy eca'tdH

Edrrw

by the S€otrid€8

a|d

Co.nmb8hn (gEC).

br ha appolntm€nt ot h€ Comprny! lxilmal audlbr br 2018 tc fie ebckho6ar! br approv8l.

A rssolulbn

Ehall bo

pre!€rbd

a Od|.ll.tl!|r The Chainq| otlhr mrqaiE b be disdssld,

9.

ril

incf.rira

widErthss

are

d|*r!lat.nt

rEttsrE a|d cooc!|rrg

Adroumm.|

detemlnrtoi thet thsre ar€ no othlr trlwant matFr8 b a Funr€d oo motlon duly made and sacondad.

Upon ba

b€ dbcEsed, the flt€e0ng wlll

Number of Shares ReDres€nt€d

PROXY KI{OIY ALL

IEN

BY THESE PRESENTS:

That l, th€ undersigned, a stockhold€r of SEAFRONT RESOURCES CORPORATIOI{, ("SEAFRONT") a corporation duly organized and existjng und€r and by vijtue of ths lavvs of the Republic of the Philippines, do hereby name, constitule and appoint [r.

Roberto Jo3! L. Caltillo, Jt or in his abs€nca, the Cheirman of the Meeting, as my continuing proxy, with rigt( of substitution and revocation, to represent me and vote all shares reglstored in my name in the books of Seafronl Resourcas Corporation or onned by me, at the regular meeting of stockholders to be h€ld on 17 May 2018 and any adjoummenus lhereof the follovying:

a. Certiticetlon of Service of Notice: b. Detemination ot Quorum/Call to Otd€r; c. Approvalof Minutes of the last R€gular Annual Slockhold€E

Meeting held 19 May 2017: d. Approvel of Management Report and the 20'17 Audited Financial Statements; e. Confirmation and Ratification of all ac{s, contracts and investment made and entered into by Management and/or Board of Dlrec{ors during the period 19 May 2017 and 17 May 2O't8: Ebction ot Nin6 (9) membeE of the Board ot Directors (including Ind€psndent Directors) for the year 201&2019; of Extemal Auditors; Appoiniment s. h. Other Matt6rs; i. Adjoumm€ni.

t

as fully to all intents and purpose8 as I might do if pros6nt and aciing in pe6on, with this proxy suspended in 6v6ry instanca where I personally attend and fotmally |lgister my pr$gncg at the me3ting. This prory revokes any and all proxies, which I may have previously executed in favor of a peGon or peEons olher than that named ebove. This proxy shall remain in full torce and effeci until specifically ravoked by me through notice in writing lodged with Corporat€ Socretary of Seafront before the scheduled tim6 of the m6eting.

lN wlTl{ESS YUHEREOF, I hav6 hersto 3et my hend thb

-

2018 at

day ot

Signature Over Printed Name ot Stockholder

Address of Stockhold€r Prorv

ml

SECURITIES AND EXCHANGE COMMISSTON SEC FORM 2GIS lnformation Statement Pursua||l to Scalion 20 ol S.curitl6 R.guhtion Code

I.

Chack the appropriate box:

&tr'

----tlPrEliminary Infonnation Stst€mcnt _Defi nitiv€ Informrtion Sra&meni

2. Nsnc of RegisEanr

as

specified in its charter:

@

3.

Provinc€, counEy or odFrjurisdiclio[ ofincorpo€tion or orSanization: PASIG

4.

SEC ldentification Nomber:

5. BIR Tax ldentificarior Codq

t^, r-

CITY. PHILIPPINES

lEZg

!gq!E!!&!

6. Address of principal office:

N.E!I!!OS9.-PHIIIPPUES 7. RegistEnls 8.

te

lephone number, including ,r€a codet

(@)-gLgE

Datc, tim€.nd place ofthe meeting ofs€curity hold*r Podiup 4. RCBC Phz.. AvrL Cor. S.n. Cll J. Pur.t

9. Approximate

date on which

@

Av.6u.!. Mrkrti Citv.

$e lnfomation Statement is first to bc s.nt or given lo s€curity holders

l!!4!!!29!&

10. Securities registered pursuant to Section 4 ard E ofthc RSA (infonnation on number of shaEs and amount oldebt is applicable only to corporate reSistrants):

Title of Each

Cl.ss

common I

I

.

Nunber of Shar€s ofcommon Slock Oulsttnding !63.000.000 3b.r.s

Ar€ any or all of registranl's securities list€d on the Philippin€ Stock Exchonge?

Yes 1..'

No

Informrtion Required by ltems of SEC Form 2GlS

A. GENERAL INFORMATION

@ The Regular Annual M€eting of SrockholdeB of Seafiont Resources Corporstion will be held at lhe Rooms 52t.528 YIAS, Podiun 4, RCBC Pl8za, Ayal. Cor. Cil J. Puyat Avenues, Malati City, on Thuddty, Mry l?,201&.r l:30 p.m.

Mailing Address

-

7d Floor,

kvel

5,

JMT BulldlEs, ADB Avenue, onlg.s centet, P.ri8 City, Philippinc!.

Approximate date ofwhich rhe lnfomation stalement b to be first sent or given to security holdersr 25 April 2018

WE ARE NOT ASKING YOU FOR A PROXY A D YOU ARE REOUESTED NOT TO SEND US A PROXY hem 2

.

Diir.nteB' Rlphl of Aoor.ilrl

Therc arc no corpont€ matte$ or sctions $at Titlc X ofth€ CorDoration Code.

*ill

entitle dissenting slockholders io exercise their right ofappraisal a! prgvidad in tha

Although thc following actions are not among th? m.dcrs to bc lakcn up during the 20lt Annual Stocl.holders' Meetin& lhe stockholders are her€in apprised oftheir ap'praisal rights pursua lo Titlc X ofthe Philippine Coryorrtion Code. A stockholder shall have the ighr to di$lent 6nd demond paymenr of fair value of the share in clsa he votld against thc following proposed corpottte actions: (a) in case any amendment to the anicles of incorporation hrs the efccl of changing or rastriding the rights of any stockholders or cl&ss of shares. or of authorizing preferences in any respecr supcdor lo those oulslanding shar.s of any class, ot .xtlnding or shortcning the lerm of corporate existence; (b) in c-ase of sale. less€, exqhtnge, transfer, monSage, pledge or odcr disposition ofall or substantially all ofth€ corpode prop€rty and a$!€6; and (c) in c&s€ ofme.get or consolidadon.

The sppraisal righr may be exercis€d by the diss€nting stockholdar by making a written demand for payment of the fair value ofhis shar€s on the compEny whhin $iny (30) days afr€r the date oo which thc votc was taken and within ten (10) days aner demahding payment on his shares, he shall submit the c€rtificate of stocks reprerenting his shares to tbe company for notation thercon thal such shaEs ate dis!€nting shsrB. If the proposed corpomte action is implemented and if lhe.c is agrernent 65 to thc fab valuc of the shares, the compony shall pay thc fair vatle of the shar€s to such stockholder upon sunender and transfer of lhe ccnificala of stock, Thc foir v6lua ofthe shar. shall bc determined as to thc dry prior to the drte on which the vote was ttken, excluding any appreciaion or dcpr€cistion in nnticipation of such corpont actions. Provided, thal no payment shall be made to any dissenting stockholder, unless rhe comp€ny has urestricted r€tainad aaming5 in its bookr to cove. such paFent. lfwilhin s period of sixty (60) drys ftom the dlre of the corporste icrion was approve4 the withdrawing stockholder of thc company cannol agl€e on the fair value of the

shares, it shall be detemined an apFaised by three (3) disinterested pcrsons, onc of whom shall bc named by th€ dissenting stockholder. shother by the company aod thi.d by the two Feviously chos€. The fmdings ofthe majoriry ofth€ apprais€Is will b€ final and the swsrd shall be psid by the compsny *ilhin lhi.ty (30) days aner $e swsrd is rnade. Upon paymant ofthc.g€cd o. a*lrdad prica, the stockholder shall fonhwidr lransfer his share to thc compsoy. From the time of demand fo. paymcnl of the f8i value ofthe stockholdcr sharas, all rights accruing to such shares, including voting and dividend righrs shall be supanded.

Itcp

3

-

hac.tst ofccnlln P.rroN ir MrttcE to be Acted Uooo

of6c nornincc ot axacutive officer of the Compsny at any time since the beginning of th€ losr fiscal yesr had nny subsranrial inrer€st, direct o. indi€ct, by sccudg holdings or othcrwisq in any ofthe ma(ers to be acted upon in the meeting, other $an elecrion !o oftic€.

No dir€ctor, nominee for election as director, asociate

No dir€ctor has informed the Corpolstion in writing that he

i

ends to oppose ony action to be takeo by the rcgiatrant at the me€ting.

B. CONTROL AND COMPENSATION INFORMATION Item 4

a)

- vottrs

Sccuriti€! rnd Prlncip3l Hold.rs Thcr.of

Number of Shares Oubianding as of 3l March20l8: Numb€r of Votes Enlitled as of 31 March2018: The

a3

b

follorrs:

b)

All stockholders

c)

Manner of Voting Section 5.0 ofAnicle II of the By-Inws ofthe Corporation provides that stockholde. may vole al all m€eiings the number of shares register€d in lheir r*Fective narnes either in person or by pmxy ex€cutei in \rdling. No proxy shall be recogniz€d

as

ofMsrch 09,2018 arc entitled to notice

163,m0,m0

OnG(l) votc pcr shart

and

vote at the Armual Stocklolders Meeting.

unless pres.nted to the Secretary for inspection and registration al le,st ten (10) calend'I days b€fore the date of

$id

meelinS.

ln the same vein, Section 24 ofthe Corporalion Code ofthe Philippines provides that each stockholder may vote in any

of

the following manner:

l) he/she msy vote such number ofshares for as many peNons as therc arc Directors to b€ elected; 2) he/she may curnulate said share and give one candidate as many votes as the number of Directors to be el€cted 3) d)

nultiplied by hirfte.

shar€s; he/sbe may distribute them on the same principl€ among as many candidates as he/she may se€

fil. ln any ofthes€ instances. the total number of votes cast by the stockholders should not exceed the number of shares o$ned by him./her as shown in the books ofthe Corporation multiplied by tfte total number of Directors to b€ elected.

Security ownership ofcenain Record ard Beneficial Owners and Management Security Ownership ofcenain Record and Beneficial Own€Is

(l)

Th. tolloqing rablc *ts lonh infom ion rith

Nmq^ddBs

cF.t

to a

E6rd

or

b.n.ficirl ow.r diEcrly or

'ndiFcdy

oqning more lhm

5olo

ol$. Conpeyt

C@iral

Stek

of tu@rd

40.92v" PMMIC

l0.46e.EtE

t8 69/"

t5,544.91|

cBctrA-scA*oo10 CBC BuildinS.Trusl

cBc T/A-SCA,00I

t,r.t?8,625

I

CBC Duilding, llust

r

0,204,120

6le/n

N@ rr ft. nobm ot th. Cm@y's .(lllrlln sh:c ft8in d lidc lb. m of rcD Nmis ovx rd. th8n 5% of rh. cmMv s cl)llllm shtB 2 n .o@d.dof PMMIC& @i.d oa by $ Bo&.d olltFroB en Mm'rmt Ms HdftY Dc n d" CbtDClu orPlvfirlc l. tl*corDdn drof Alsscd R6..le e cm.d d by ns Bd'd olDiFtm It. TM L Ak.l@ i! tnc clmt pcd6r of rh. cd's y a CaC ,I?^-s$aoolo !d l/A-sscdDll eTd Ac.N6 *nh Chim Br* sCqpcdmaTdc r].lCdBmt.dsofclrcesieddbyitsBodrdof Didmsd Mel8ffr Mr. Riadr R. Cho i! rE c|!Mr CAC nBrtd{ d CEo ' tCD lod .LE irdd. nddD .d ri*F'lirlE

4

(2)

Secuity Ownership of Ma[agement

as

of March

3 I , 20 I

8.

The following are the dumber of shares ouned of record by the Directors, the Chiel Executive Oflicer and €ach of lhe key of shar.holdinss of each: officers offie and the Nrme of B.nefici.l Own.r

Nrre.d

Tillc of Cl|,!

Poritio!

Robeno iose L. Ca5lillo, J..

Chainnan

.

and Di.cclor

.ffectivc

Amoult tnd Nrtnr. of

B...fici.l Owtr.r3hio

Citiz.nrhio,

I

'Dirg;r"

Filipino

I

"Direc('

FiliDino

|

"Dired"

FebnEv22.2Ol8 Miloeros V. Rey6 Presidmr ed Perry Y. Uy

Di€lor

Yvonne S. Yuchengco

| "Dir€ct"

FiliDino

425'Dirccl 2.834'Indir€ct" Dire.tor Emesiinecma

| Jo

D,

FiliDino

'Direci'

vil'eal-lcdando | 'Dare.t'

rili.ino FiliDino

l.000 "Dirccfl

FiliDino FiliDino

Filioino

Assr. Co.Domte SccreLrv

iltt26 $|rca o.ao.a Tot l . Mrtob.tu Ja L Csdo D€* . dt*b. d J.drr 5,.l0lt dir4 . .D..Ll iod .dd.a .d .r It|EbE drrl.r iL s c-t!|fl. ., rL f,ad .krd Jr.-.v r' ro|& Fdort 22, z0lt E tt. bqra rcai.& H.!!L..d Mr H.ld Y. Dc rL trttr.d s Crnd.. dbiE 's As of March 31, 2018, the Company's directors and executive omcers owned arl aggregare of4926 shares €quival€nt to 0.0'lo ofthe Company's ourstanding shares. None of th€ memb€rs ofthe Company's dift.ton and management owns mot€ lhan 2% of the ouBlanding capital stock ofrhe Conpany.

Voting

Trwt Holden of

S9l.

Comp6ny is not aware of .my voting trust or siinilar anangement among peNons holding more than 57o ofa clas! ofshares.

or monFThe

Chsngca In Conirol - Therc llad tr€el no change in the control of th€ Company since lhe beginning of the lasl fiscal year. The Company has no existing voting trult or change in coltrol agreements.

Item 5 - Director! and Ex€cutive OlficeN: DiEctor

1l Rob.no

,@

1,.

Cruillo, Jr

Bo€rd

6 64 15

Jo

D VillNd-fo&do

2002 of th.

ed

62 56

.trdriv. F60!.y

| !s to

201

Bdd

DiEtd qd ci.irm'|

"' 12

Enstinecmd

3i.e

Chlimln

of dE 22, 2018

Executiv€ Offic€rsr 16 12

5l AisL

C(Drlrc

sqlts

m

clcctcd ar rhe Annual Stockholders' Mc.ting lo hold oiice until lhe ncxl Annual $ockholdeB' Meetif,S and until $eh r.specrive successo$ have b€en appoinled or eleded and quali{iql. 't he mcmbcB

of the Boa.d

Eelow is the

lkt

of the members of th€ Board, Nominees,

.nd thc corporrte ollicers, snd their

busincss e4erience during the

prst five (5) yeers:

Mr, Rob€.to Jose L. Castillo, 64. Filipino. is pres€ntly the President & CEO of EEI Corporation, an 87-y€ar old company that Fovides constnrction services in the Philjppines, the Middle East, South Pacific and Africa. Mr. Castillo also ov€rsees EEI subsidjaries namely: Equipment Engineers, EEI Construction and Marine, lnc., EEI Poryet Corporation, Al Rushaid Peholeum lnvestment Company in Saudi Arabia, EEI Realty Co.pomtion and Culf Asia Intemational Corpomtion. EEI is a member of the Yuch€ngco cmup of Companies. He is also a Director of the following: Petrowind En€.ry, Inc., Petrocteen Enerry Corporation, Petrosolar Corporation, Brightnote Assets Corpo.ation, Hermosa Ecozone Development Corporadon, Kubota-Kasui Philippincs Corporation. SQ Resources, Inc., SN Resowces, lnc., Somersd Hospitality Holdings Philippines, lnc., Ascolr Hospitality Holdings Phitippines, Inc. and Tong Hsing Electronics Philippines. Inc. He is also Chairman of the Advisory Board Carmebay lndustrial Cor?oration and Chaiman CJC Corporation.

Ma. Mlhgros V. Reyes, ?6, Filipino, is preseotly th. Chairman/Presidert of Petrocrccn Ener$/ Corpontion, Chaiiman of Maiba.ara Ceothermal, lnc. She is also the President of PetroEnergy Resouces Cor?omtion, an oil explomtion and development company, and Perosolar Corporarion. She is also a Director of lpeople, lm., Director/Tredsurer of Hemosa Ecozone & Development Corporation. She was formerly a Director/Consultant ofPNOC-EC and a Senior Vice President of Basic Petroleum and

Minenls.lnc.

72, Filipino, is prcsently the Presid€nr of Manila Memorial Park. He is a Dir€ctor of La Funemria Paz, Sucal. He is also an ftx{om member of Manila Memorial Park and La Funeraria Paz, Sucat. He is formerly a member of the Boad of Directors ofvarious companies such as: RCBC Realty corp., EEI corporation, I People, lnc., Landcv corp., Hi-Esai, First Malayan t easing, Subic Power Coryomlion, Malayan Colleges L€unq lnc., Honda Cars, tdc. in Quezon City/Kalookan and lsuzu Manila

Mr. Perry Y. Uy,

Mr. Yvonn€ S. Yfthengco' 64, Filipino, is the Presiden/Director of Malayan Insunnce Compsny' Inc.' Mico Equities, lnc, Philippine lotegrated Advertising Agency, lnc-, Alto Pacific Cor?oration, RCBC Land, Inc. She also holds the position of ChaiDerson of First Nationwide Assurance Corporation, The Malayan Plaza Cond. Own€ru Association, I|!c, RCBC Capital corporation and xYz Assets coryoration. chairpeNon/Pfesidanr oi Royal commons, lnc., Y Tower Il ofiice cond corp., Yuchengco Tower Ofiice Condominium Corp. Director/Treasurer and ClO of Pan Malayan Mgml. & lnv't. Corp., Director and Tre&surer PetroEnergy Resources Corporation; Honala Cars Kslookan, Mona Lisa Development Corpomtior! Asst. Tr€asurer, Enrique T. Yuchengco, Inc.; Memtrer, Board of Trustees AY Foundation, Inc, Mapua lnslitute of Technolos/, lnc, Phil-Asia Assistance Foundation, Inc., Yuchengco Museum,Inc. She is a member ofAdvisory Commitlee ofRizal Bat*ing Corporation. She also sits in the board of several companies such as: House of Investrnenl Inc.. HYD€e Mana8ement and Resource Cor?., iPeople, inc.. La Frmeraria Paz lnc.-Sucnl, Luisita lndustrral Park Corp.. Malayan Coltege trguna, Inc.. Malaysn Colleges, lnc., Malayan High School of Scjence, lnc., Malayan lnsumnce (H.K.), Malayan lntemational Insumnce CoIp.. Msnila Menolial Park, lnc., Ntional Reinsurance Corpomtion of the pilippines, Pan Malayan Exp.ess, lnc., Pan Malayan R€alty Corporation, Asia-Pac Reinsumnce Co., Ltd., AY Holdings, Inc., DS Realty, Inc., Pan Pacific Computer C€nt€r, lnc,Shayamala Corpomtion and YCC Coroorale Services. lnc.

President and CEO ol House of Investments, lnc. and President of RCBC Realty Corporation. He serves as Director ofHouse of Inv€sdnents and its significant subsidiaries and asso.iates- H€ also serv$ as Direclor of Rizal Commercial Banking Corpomtion and National Reinsuranca Corporatron ofthe Philippines. He was former senior partner of Sycip, cores, Velayo and Co., CPAS where he served as Financial Srrvice Practice H€ad. He also serves as Direcior and Treasurer of CRIBS Foundation, Inc.

Mr. Medel T. N€rr, 62, Filipino, is the

Chairman of Conal Corporstion and Vice{hairm.n of Aviana Development Corpolarion. He is a mernber of rhe Boad of Directors of various companies such ss: Aces Technical Serviccs, lnc ,

Mr. Nicssio I. Alcsnt{ra, 75. Filipino, He is Fesently the

Acil Corporation, Alcor Tmnsport Corporatior!, Alsing Power Holdings, lnc., Alsons Aquaculture Coryoration, AlsonyAWS

lnformation System, lnc. Alsons Coryomtion, Alsons Development & Investments Corp., Alsons Insumnce B.okers Corp., Alsons Land corporation, Alsons Power Holdings corporation, Alsons Properti€s corpomtion, Alsons security co., Inc., Aquasur

Resouces Corporation, BDO Private Bank, Inc., Buayan Cattle, lnc. Conal Holdings Coryoration, Finfish Halch€ries, Inc., lndophil Resouces NL, The Philoddll CorDorarion, San Ramon Power, lnc., S'arangani Agricultur-al Co., lnc., SamnSani Energ/ Co.pomtion, Seawood Hotdings lncorporared Sunfoods Agri. Ventures, Inc., Site Croup Intemational, Ltd. Southem Philippines Power Corpomtion and westem Mindanao Power Corpora$on.

Atty. Ernestire Crrmcn Jo Vilhr€al-Fernrndo, 56, Filipino, Sh€ is th€ Director of various corporation such as: CounFy Banken lnsurdnc€ Corpoiation, Country Bankers Life lnsumnce Corporation, Director and Treasurer ofJose E. Desiderio, Inc., Managing Director of Cente. for Asian Culinary Studies and Femando Villaroal Books, lrgal Counsel, Committe€ on Art Auction, Ateneo Alumni Associarion, Parmer, tenando Panagsagan Btuitilan Law Office.

Mr. Victor V. Bensvidez, 66, Filipino, He is the Nominee of Alakor

Securities Cor?omtion, Dhector ofBoulevard Holdings, Inc.

Formerly: Geneml Manag€r of Alakor Securities. Inc, Director, Mariwasa siam Holdings, Anglo Philippines Holdings Corpomtion, VP and Director Mabuhay Holdings Corpontion and Taga$ay Prop€nies & Holdings corporation. Columnist, The Daily Clobe, Iov€s[nent Res€irch Consultant ofJames Cap€I, Manager/Corplan of Banco Filipino and Managet/lnv€strn€nt Research ofAnselmo Trinidad & Co.

Mr. Rlul M. koFndo, 66, Filipino, He is the Chairman of RCBC Securitiei, Inc., President and Dire€tor of InvesBnenl Houses Association ofthe Phils. (IHAP). Consultant of RCBC Cspital Corporation, Director, Bankar4 Inc. He is slso formerly Chaimran of the Board and Noninee ofPhilippine Stock Exchange, Inc and formerly President and CEO ofRCBC Capital Corporation Aaty. Samuel V. Torrcr, 53, Filipino, is the Cen. Counsevcorporate Secretary of AY Foundation, Alto Pacific Conp8ny, Inc. (Formerly: The Pacific Fund, lnc.), Banlers Assurance Corp., FBIA lnsurance Agency, Inc., Bluehounds Security & tnt't. Agency, Enrique T. Yuchengco, lnc., First Nationwide Assumnce Corp., GPL Holdings, lnc CPL C€bu Tower O{fic€ Cond Cory., GPL Holdings, Inc., crepaland, Inc., Grepa Realiry Holding Coeoration, Hexsgon Integrated Financial & Insurance Agency, Hi-Eisai Pharmaceutical, Inc., Honda Cars Kslookan, Inc, House of lnveslmenls, Inc , Hexagon Inlegrated Fin lns Agency, Inc , Hexagon Lounge, !nc., iPeople, Inc., Inv€stnent Managers, Inc., lnnd€v Corporation, La Funemria Paz'Sucat, Inc., Malayan High School of Science, lnc., Malayan lnsumnce Co., lnc., Mico Equities, Inc., Malayan Colleges, Inc., Malayan Colleges Leguna' Inc.' Malayan Secdities Corpomtion, Mapua lnformation Technolory Centcr, Inc., MJ88t Corpontion, Mona Lisa Developmen! Corpomtion, Pan Mdayan Msnagement & Investment Corporation, Pao Malayan Reahy Co.pomtion, Pan Malayan Express, Inc.. Pan Pacific Computer C€nter, Inc., People eserve CorpoEriod, PetroEners/ Resources Corporatiot! Philippine Integrated Advertising Agency, lnc.. Royal Commons, Inc., RCBC Forex Cor?oration, RCBC Realty Corporalion, RCBC Land, RCBC Secuiities' Inc.' RCBC Bankard Services CorDoration, RCBC Securities, Inc.. RP Land Development Corporariod, Sun Life Crepa Finarcial, tnc., yuch€ngco Mus€um, YCC Corporare Services. Inc., Y Realty Corporarion, Y Tower Il Office Condominium Corp., Yuchengco Tower ofrce Condominium corp. and xamdu Motors, Inc.

Atty. Arlan P. Profeta, rg, Filipino, is presently the Corporate Secretary of Maibarara Ceothermal, Inc., Pefocr€€n Energy Corporarion, Petrowind Energy, lnc. and Perrosolar Corporation. He isalsolheAsst. Corporate Secretary ofPefoEnerry Resources Corpomtion and formerly Tax N4anager of Punongbayan and Amullo.

Nomine.s for f,l€ction rs MembeK of th€ Bosrd of Diredor€:

L 2.

3.

4.

5.

Mr. Roberto Jose L. Castillo - Director Ms- Milagros V. Reyes Mr. Peny Y. Uy Ms. Yvonne S. Yuch€ngco - Dircdor Mr. Med€l T. Nera- Director

Director Director

6.

7.

8.

9.

Mr. Nic6sio l. Alcantara Independent Dir€ctor Atty. Emestine Carmen Jo D. villareal-Fcmando Mr. R6ul M, LeoDando - Director Mr. Vicror V. Benavidez - Direcior

-

lndep€ndent Director

The nominatron committ.e passed upon their qualifications and found no disqualificarions, as provided for in the By-Laws and in accordance with SRC Rule 3 8 as amended and approv€d by the Board of Directon and Stockholders on May | ?, 2008

Atty. A.turo B. Maulion, a ltockholder of record, formally nominated Mr. Nicasio I. Alcantara and Atty. Em€stine Carnen Jo D. Villareal-Fernando as Indep€ndeni Directors. Atty. Maulion has no relations with the Nominees. (Please s€€ attachcd Annex "A" for the Certification of Independenr Dircctors).

The Nominadon Committee adheres to the criteria and guidelincs goveming th€ conduct of the nominalions as s€t fortl in the Drocedures under SRC Rule 38 on the Nomination and Election of Indcp€ndent Dir€ctors, By-t$r6, and ihe Conpany's Manual of Corpomte Govemance.

7

fie

Conpany hrs adoptcd the SRC Rule 38 (Requircmcnts on Nomination and Election of Independent Direclo6) and compliance lhcrcwith has bcen made. Only nominc.s whos6 names appc$ on tlrc Final List of Candidtl.s shall be cligible for election as lndcpcndcnt Dircctoa. No fiirlhar rcminations shall be antertaircd or allowed on the floor during thc aclual annual stockholders' mccting.

An Indcpcndc||t Dirrctor is s person who b indeFndent of nunageme and the conrolling sharEholder, and is Fe€ from any business or oth€r r€latiomhip which could, or could reasonably be Frceived to, materially interfere with his ex€rcis€ of indcpcndent judgcmrot in c$rying oul his responsibilitics rs a direclor. (Phrca !a. Ann.r 'A' for the Certltlcrli,on of l.d.pcodctrl Dircclorl The mcrnbcrs ot thc Board of Di&ctors and tha lndcpcndcm DiEclors arc al.cled at thc gcneral meeting of stockholders, who shall hold offic€ for the term of one ( | ) year or until th€ir successors shall have b€€n elccLd and qullifild.

The Management Committee members and other Office.s of the Company, unless rEmovcd by the Board of Directors, such unlil th€ir succcssors arE elecled or rppointed,

$all

sarvc 4t

Slgnltlcr Eoploy... oth.l

than tha aforcmcntioncd DiractoN snd Executivc offic€rs iderfificd in the it€m on Dilectors snd Executive ofticers in lhis Information Statement, therc are no o$er employaas oftha Cornpany who may have significant influence i[ the Company's major ,nd/or sF tegic pbnninS and dccision-mrking.

Thc Corporation valucs its human r€sources. It exp€ccs each employee to do his shsrE in schicving the Corporation's sa{ goals.

F.Blty R.lrtlorrhlp Therc are no f.mily r€lationships kno$n to thc Compsny.

C.rtrin R€LtiotrlhiF.od Rel.ted TrrnecdoDs Relat€d party relarioBhip exisc when one psrty has the ability to cantrol dircclly, or indir€ctly trough one o. morc intemediari€s, the other psrty or exer€b€ significant influence over the olher psrty in making financial and opcrtting dacisiotrs. Such rclationship elso exists between rnd/or anong entities. which are unde. common conEol with lhe r€porting enterprfu€s and its kcy nanaSamcnt p€rsonnel, dircctols, or irs shdrholders. ln coNid€ring €ach r€lated party relationship, rltcnlion is dir€cted to the sub6tancc oftbc rclstionship, and not m€r€ly lhc lcgal form.

The Compsny in its regular conduct of busincss has

d

cald into the followiog tramaclions wilh clated panies consisting

of

rcimburs€ment ofexpens€s and managcmeol and aocounting sefticcs agtaqnarts.

hvolv.m.nt itr Cartrln Lagrl Procccdingt For thc past five (5) years, none ofth€ DirrctoE or Executive Ofticers was involved nor hts aDy such oflic€r or ditlctor has baln involvad in 6ny lcgal casls undar tha l$olvency Law or the Philippine Revis€d Penal Code eithe. as defendont or accue4 nor has any such offcer or dllctor b€qr thc subjcq of any c.un order, judgmcnt or decrEe b6rrin& sBpending or othe is€ limiting him from engaging in the practic€ of any typc of business including d|osc connlcted with s€curities Eading" inve$rnenls, insurance o. banlinS activities.

As of this r€poi, lhe Company b not a party !o any lirigarion or rrbitration pmc€€dingr of m6tarial imporraDe, \,trich could b€ exp€clcd (o have a matcrial advers€ efrect on the Company or on the resulb of its operations. No litigation oa claim of marcrial impo(ancc is kro\rn to b€ p€nding or d|rl ted ag8inst the Company or any of ils propedies.

Rehtcd P.rty Tr.os.cllotra Relarcd prrty relationship exisls whcn onc pany has tha ability to conFol, dircclly, or indircctly through one o. more intermcdiariesr the orher psrty or exercise significant influeoc€ ovcr d|G odEr parq in makirg finsncial end operating d€cisions. Such rcbtionship slso exbts b€tween nnd/or amonS cntities, *hich sre undc. co'tuaon control with thc r€po.ting rnt€rpris.s and its key mantSement

personnel. dircclors, or its shareholders- In considering each relaled party relationship, att€ntion is directed to the substance relationship, and not merely the legal fom.

ofthe

The Company in its regular cobduct of buliness has enlered into the following transactions with related parties consisting of reimbursemenl ofexpens€s and man€gement and accounting sewices aSreements.

The Company's financial staten€nts include lhe following amounls resultinS from tsansactions with related parties:

7nt1

N.tur ot

tn.$ctio.

Amoo||U Voltmc

PrY|blc ttrd

tccru.d

T.rn!

.tp.ft.s

Condltlon!

Amlhi.: No.int rdt b€.ringj

PERC

plyrbl.wt.ndu.

ReimbrB.mcnb Yll,62S

711,625 !d demrndrblc

Aeouting Senic.s

HEDC

{Nole

l0)

267t57 P339.{82

-do-

-

Un!.cu..d

-do-

F71.625

20t6

Amounv R€ceivables of rrDsacrion Volume Nole 9) Naturc

Tcrns

Conditions

Aifiliatc: Nonitlercst b€din&

PF:RC

ReimbMmts

Pl

1,127

P

payable and

whs

duc

Uns€cured,

deman&blc no inpairm.nl

A@unnna

HEDC

Senic€s

Notes

9ud l0)

267.a57

F2?9.r84

25,000

-do-

-do-

F25.000

No compensation and short-term benefits for key management personn€l werc charged in pmfit or loss

a5

of Decembet 31. 2017 and

2016 because PERC provides administrative services to the Company.

Terns an l conditio^r d iorcactions vrith rclated pa ies Outstanding balances at year-end are to b€ senled in cash. Therc have been no guanntees provided ot receiv€d for any relat€d party receivables or payables.

Aside flom the above, th€re w€re no other r€lated transactions or proposed transaclions duing the last two (2) years to which the regisrant rYas or is io be a pany,

Dfu.grc€menb with the ConFnny

No direcror has resigned or declined to stand for re-€lecrion for the Boord of Directors since the date of the annu3l meeling security holders due ro any disage€ment with the Corporstion relative to lhe Corpodion's operations, policies and praclices.

of

It.m 6 - compe ation of Dircctors and Ereculive Omcers Table (CEo and

Hichest Paid Execurive oIlicer ComDcnsation Desisnrtion

Milados V. Rcves

President

Perry Y. Uy Atty. Samuel V. Tones

CorDorale Secretary Asst. Corpomte Secrelarv

Atty. Arlan P. Prolela

able

{All Dreclols

as a

S.lr.y

Prnicuh.s

8oo||!€s

Oah€rAndurl Compcnsrtio.

2015

All Dire$ors

ss a

goup'

r

20t6 20t7 2018i.

70,000 75.000 85,000

95.000

Toi.l 70,000 75.000 85.000 95.000

rall executive officers ofthe comp:my do not rcceive any compensation.

** 2018 projected perdiem during BOD meetings.

There is no emplolment conlmct btwe€n the registrant and lhe Chairman and all others Executive Officers.

There are no other arangements pursuant to which any dircctor of the company was compensatedt or is to be comp€nsated,

dire.lly or indircctly.

Iten ? - Indep€ndena Public Accountlot The extemal audilor ofthe Corporation is the auditing firm Slcip Corres Velayo & Co. (SGV). The sat0c accounting flrm has been endoned by the Audit Committee to the Boad. The Board, in turn, approved the endorsement and will nominate the reappointrnent of the said auditing firm for the stockholders' approval at the scheduled annual stockholders' meetinS. The said auditing firm has accepted the Company's invitation to stand for re-election lhis year.

Audit s€rvic€s of SCV tbr the calendar year ended Decemb€r 3t, 201? are the exarnination ol the financial sEenents of the Company, review of income lax rctums and other s€rvices related to filing of.eports made with lhe Secudties and Exchange Commission and BurEau of lntemal Revenue.

The representatives of SCV have always been pr€senr at the sharehold€rs' meeting held during prior years and shall likewise b€ pres€nt dudng this year's stockholders' m€€ting to respond to appropriale questions or make slatemenls with ret'ereDc€ to malte$ for which their services wcrc cogaged.

Punuant ro SRC Rule 68 Paragraph 3 (b) (lV) (Re: Rotstioo of Extemol Auditors), the Company has not eneiag€d Ms. Ana L€a Bergado, partner of SCV & Co,, for more than five (5) yesrs. She was engaged by the Company for examination of the Company's 20lt fmancial statements. The engagement ofthe partner is subject !o the approval by the shareholders oflhe appoinm€nt ofSGV & Co. as the extemal auditor for Calendar ]ear 20 | 7.

The Company is compliant with lhe Roiation requirement of its extemal auditor's certiryinS partner as required under SRC Rule 68 (3Xb) (tV). A two year cooling oif period shall be observed in the re-engagement of same signinB partner or individual audilor.

l0 AUDIT AND AUDIT.RELATED FEES Extemal audil fees inclusive ol VAT snd oul of pocket expenses arnounted to P323,400.00 (incl$ive of VAT) for Decemb€r 31, | 7. Said fe€s arc for ihe audit and rcvi€w of regisranl's amual financial statcments and other s€rvices render€d in connection with filing ofsaid financial statements with the gov€mment institution such as SEC and BlR.

20

Thcrt wete no fces paid or accrued for the last two years nelative to tax aocountin& compliance, advice, plaoning and 6ny other form

oftax services.

The Audit Committee approved the above fe€s based on the ser.vices rcndcrcd and the amount paid Fom the previous year's audit. k is the policy ofthe compsny that all audit findings ars pres€nted to its Audit Comminee which reviews and make Ecommendalions to the Board on actions to be taken thcreon. The Board of Dir€ctors of th€ Company pass€s upon ard approves the Audit Committee's necommendations. Thc memb€rs oftha Audit Commiltc€ ar! as follows:

Alcllltrm Nera Raut M. Leooando Nicasio I. Medel T.

Itam

8-

Chairinan (lndependent Director) Member Member

CompeBatlop Phn

No acrion is to b€ Ekcn

*ith

raspact to any plrh pursuanl Io which cash or

non{.sh comp.nsation may

be

p.id or distlibuted.

c.w Itcn

9

- Autborizrtior or l3!u.oc€ of Sccoritl6 Othcrwisc thrn

for

Erchrp.

Therc is no matter or corporate action to be taken up in rhe meeting wilh respecl to issuance ofsecurilies.

Iten l0

-

Modillcrtiotr or Erch.oee ofs.coriti6

No Modification of Outstandiog Securilies Item I I

-

Fln.Bcl.l rrd Oth.r ltrform.tlor

Thc Audited Financial Statcments ofthe Company is Attachcd as Annex incorpomrcd in tha attachcd Managamant Repon.

"A".

The Management's Discussion

& Aoalysis is

lLm |2 - Mereerl" Coololidraion. Acduillliotr rnd Similir M.tten Not Applicable.

Item l3

-

Acoubltion or Dilmrition ofPropcrlv

Not Applicable.

Itao

l4-

Rcrtrtament of Accouots

None,

D. OTI{ER MATTERS It o

s)

l5 - Aatlon wlth R..occl to R.oort!

Appruval of the M inut€s of rhe 20 | 7 Annual Shsreholders Meeting; The Minutes I

.

of20l7 Annual

Shareholders Meeting r€flects the

follo*ing:

Approval of Managlmcnt Repon and the 20 | 6 Audited Financi6l Stalemenls contained in lhe 20 | 6 lnformaaion Statement.

2.

Conlirmation and Ratification ofsll acts, conFacls and investrnents made and enlered inlo by Managcmcnt and/or $e Board of Directors during the p€riod of l9 Mdy 2016lo 19 May 2017.

ll 3.

4.

Election ofN in€ (9) mefibers of $e Bo3rd of Directors for lhe year 2017-20 | 8.

AppoinonentofExtemalAuditors.

b)

Approval ofManagemen! Report and rhe 201? Audited Financbl Srabnents;

c)

Confirmation and Rstification ofall acts, conEacls and investmenb made 6nd entcred into by Maoagcmcnt and/or the Boad of DircctoB during th€ pniod of | 9 May 20 I 7 to 17 May 20 | 8i

L

Constitution of various Coomincas and Appoinment ofchairman and MembeB: (Organizltional Meeting held | 9 May

20t1t.

Such os:

NomlDrtion Comnittee

Members -

ChaiDerson

Helen Y. Dee

MedelT. Nera Nicesio l. Alcantara - IodeDendent Director

Comp€nrrli,otr atrd Rcmutraratlor CoEmlttae Pcrry Y. Uy Chai.person -

Members -

Helen Y. Dee Emesrine camen Jo D. villereal-FemandelndeDcndant

Dir€ctor

AIdll Committ.a

Members -

Chairpelson

Rill

Manrg€nent Commialec

Memb€N -

Chairperson

CorporaL lntorD.tloB ComDlhncc Omccr

Olnc.r/

ar!r. Corpor.rc loform.iio! Otfic.r/ a.rt. CoitDli.nc. Oftc.r

2.

Nicasio I. Alcantara - Indep€ndent Director Revnaldo B. Vea Medel T. Nera

Nicasio I. Alcantan - lodapcndcnt Dircctor Yvonne S. Yuchengco

Pery Y. Uy - Atty. Samuel V. Ton€s

-

Atty. Arlan P. Profela

Ratifiaation ofacts and rcsolutions ofManagement ard oflhe Board ofDirectors as r€fened to in the Notice of the fuinual Meeting rcfe$ only (o acts and resolutions done in the ordinary .ours€ ofbusiness and opemlion of thc Compsny. Rrtilication is being sought in dle incran ofrransparency snd as a matler of cu$omary pmctice or procedure undertaken at every Annual Meeling ofstockholders oflhe Cornpany.

Ther€ are no other sc,ts and r€solutions of Management and of the Bosrd of Directors lhat oeed thc approv6l the slockholders.

d)

Election of Nine (9) members of the Board of Dllclors (including Indepcndcnt Dir€ctoE) for lhe year 20 I 8-20 | 9.

It E 16 " Mrttrr3

s) b)

Not R.aol.cd to be Submitted

Proofofthe rcquircd notice oftha mccdng Proofoflhe presence ofa quorum

Itcm l7 - Amend||tent of Ch.rler.

None.

Itep

lt

None,

-

Olh.r Propo..d Actlon

Bv-l,rr!

or Olh€r Docudeot

of

12

Itcm 19. Volltr! Prc..durai

e)

d|e votc raquir€d for appmval or elecliod

Srotion 4 ofAriicle Il ofthe By-kws ofthc CoDoration providcs that unbs.r otherwis€ Fesdb€d by the Corpo€tion l.aw, r quorun d any meeting ofdE stoc*holdeB shall crNist ofr nEjority ofthc subscrib.d capital stoc* ofrhe Codp€tly rcpFscrad in pcrsm 6 by plory, and e mijority of such quqrm shall d€cide lny qu€stion d|at may cone before lhe maatin& save ond except in lhode sevEral meers in which lhc lsws of thc Philippin€s rcquir€ thc afftEative vote ofa

grcalc Foporl'on,

Wilb rcgrrd to lha eleclion of th€ rDadbcrs of thc Bo€d of Dir€c1ors, d|e nsnin€€s r€c€iving th€ highest number of vote shrll bc dccLr€d clecled pursuad to s€ction 24 of tho Corporation Code of the Philippincs. Likc*ise, for the elcclion of Ext mal Audilols,lhe nomi&€ receiving lha highast rurnbcr ofvotas *ill bc dcclarcd th€ Coryor.tion's Excrnal Audilors.

b)

the method by which votes vrill be counled

Exccpt in cases wher€ voting by ballot is applicablc, voting and counting shall be viva voce. Ifby ballol, counting shall be suporyisad by tha oxlemal auditors and ftnrfer agcnt!. lfby viva voc€, counting shall also b€ supervised by th€ .xtemal auditots 6nd tlansGr 6eents.

l3

SIGNATURE

Aftar reesoaable itrquiry rnd to the b.st of my knowl€dg€ snd belicf, I c€rtify thst th€ information set forth in this report is true, compl€te rnd corrett. Thfu report is sign€d tu tbe Clty of Plslg on _ April2018.

SEAFRONT RESOURCES CORPORATION

Arz

t--

/3lrvu-sr- v. rirnnss corpo"ate sectetuy

/

dd

l4 MANAGEMDNT Rf,PORT TO STOCKHOLDERS I. AUSINESS AND CANERAL INFORMATION

PART

Datcription of Busircss

lien l - B||siness

Develoomenl

Seafronl Resources Cor?oration (the "Company') was registered wifi lhe Seculities and Exchange Commissiotr (SEC) on April 16, 1970 as an oil exploralion and production company. On October 18, 1996, tle Compaoy amended its Anicles of lncorpomlion which provides for the revision of its primary pupose liom engaginS in the business ofoil explontion atrd production into a holding company and to include oil exploration and produclion business as one of its secondary puryos€s.

Tha Company implemented a quasireorganization plan whercby (a) its authorized capital stock was decreas€d liom P800 Million divided into 800 Million shares, 1o P388 Million divid€d into 3E8 Million shares, both at par value ofPl: and O) its issued and subscrib€d capital stock were decreased from P575 Million to Pl63 Million appli€d plopodonalely for all stockholders. The reduction surplus resulting lrom the quasi-reorganization was used to offset the Company's deficit .s of December 31, 1997. The quasi-r€organization plan was approved by dle SEC on October 5, I 998.

The registered ofrice address ofthe Company is 7th Floor, JMT Building, ADB Avenue,

frigas

Center, PasigCity.

The Company's sharcs ofstock are listed and are cur€ntly traded at the Philippine Stock Exchange.

Busin€3s of l$u€.

A. Inv6tm€nt! in trinancirl As€ts

rt Fair Vrlu€ through Profit rnd l,oca (FVPL) (Note 8 of the AFS) The Company maintains a podfolio of inv€stments in stocks traded in the Philippine Stock Exchange and investment in Govemment Securities. These finrncial ass€rs at FVPL are caried st fsir value as follows: Listed securities: Eouitv

securities

2011

2016

F62.845291

?41.453,721

B. lnveslment in Av.iLble for Sde SecuritiB (AFS) (Nole E of tbe AFS) AFS financial sssets consisr of quoted and unquoted sha.es of stock held for long-term investment purposes and are caried at iair value. The carrying values ofthese investments are as follows

Listed equity securities:

PetroEnergyResourcesCorporation(PERC) Bensuet

CorDomtion

2017

2016

?23,492,102

Pl5,982,332

4.338.155 27,830.257

5.591,957 21,5',t4,289

Nonlisted equity secuiity: Hemosa Ecozone Development Corpoaation

(HEDC)

Investment in Covemment

Secuities

494,534,818

8,535,131

P530,m0,206

121,999.234 6,081,769 ?149.655,296

lnvestnent in HEDC

I I , | 997, the Company entered into a Projecl Shareholders' Agreement with five other €ompanies l.d by Investtnent and Capital Corporation of tbe Philippines and Penta Capital Investmenr Corporstion to develop 500 lo 600 hectares of raw land in Hermos4 Batasn into a ne{, romship consisting of industrial estaies, residential communities, a golf ajd country club and a On January

As of December 31, 2017 and 2016, tbe Company har oubtanding subsariptions payable to HEDC which amounted PI2.35 million.

The subscriptions payable are due on demand (see Note l3). lnvestrnent in HEDC is presented in the stal€ment of financial position at fair value net of subscription payable.

The fair value ofinvestment in HEDC is detennin€d using the adjusted net ass€t method wherein the ass€ls of HEDC consistrng mainly ofparcels of land are adjusted ftom cost to lls fair value. The valuation ofthe parcels of land l,as p€rformed by an acqedit€d indep€ndent valuation company as at December 3 I, 201 7 and 20 | 6. This measurement falls mder Level 3 in lhe fair value hiemrchy.

As a resuh ofrhe valuation, the Compaoy recognized unrealized gain on fair value changes of its invesment in HEDC amounting to P 372-54 million and P34.30 million in 2017 and 2016, respectively, in other comprehensive income.

Trensrction with snd/or dep€ndencc on releted pertles Not applicable Percetrtage ofsale or revenue snd net income contributed by forelgn sales Revenues which are mainly {iom the uffealized gains on market value changes ofFVPL, interest income, dividend and rental income are denominated in Pesos. There are no revenues ftom foreien sal€s.

Tot8l number of €mploye€j The Company has no employees; PERC provides administrative, accounting and legal s€rvic€s to the Company. The company does not anticipare any sp€cial undenaking thal would wardnt hiring some people for regular employrnent.

Conpetitiotr Th€ Compahy itself has no competitor b€cause it is a holding company. Its major investrnent, HEDC has competiton such as Clark Developmert Corpomtion, Subic Gateway Pa* and other nearby indust ial zon€s.

Petenl, trrde, copyright, licenses and etc.

The Company has no existing patents, trademarks, copyrighls, licenses, franchises, concessions or royalty ogrcements

Reserrch rnd d€velopm€nt rctivltlei

No amounl of money was spent for development activities for the lasl three fiscal years. Tbe Company do€s not intend to acquire additional propenies in the next rw€lve (12) nonths. However. fie Company can sustain its need for op€rating exFenses in the ordinary course of busincss,

Product!

The Company has its investments in stocks (as discussed in the "Busincss ofthe lssuer") as its principal produ€t. Tolal revenue as of December 31. 2Ol6 ainounred to P?.634 millioq bulk ofwhich is {iom the unrealized gain on the fair value changes of investments in FVPL. Other than discussed, the Company has no princ'pal product which contributes l0olo or more to sales or revenues. No govemment approval is needed for its principal Product.

Rkk Factors

Economi

ines Political.

The Philippines has, from time ro time, experienced military instabilily, mass demonstrations, and simila. occurences. which have led to political instability. The country has also exp€rienced periods of slow gro*ah, high inflation and sigificant depreciation ofthe peso. The .egional economic crisis which started in 199? negatively affected the Philippine economy resuhing in the decline ofthe peso, higher inter€sl mre, increased unemployment, geater volatility and lower value ofthe stock market, lo*er credit mting ofthe country alld the reducrion of the counrry's foreign currency resew€s. There has also been growing concems about the unrestrained judicial intervention in major infrastuctue project ofthe govemmenl.

Therc is no assurance tha! the political environment in the Philippines will be stable and that cunent or future govemmenls will adopt economic policies conduciv€ io suslained economic growlh The general politica! sjruation in and the state ofthe economy ofthe Philippines may influence the gro*th and profitabilit ofth€ Conpany. Any future political or €conomic instability in these countries may have a negative effeci on the flnancial results ofthe Company.

Eouitv Partdershio Risk The Company entered into a Project Shareholder's Agreement with five other companies led by lnvestment and Capiial CorPordtion of the philippines and Penla Capirat Invesmeot Corpomtion to develop 500400 hectares of raw land in Hemosa, Bataan. lnlo a township consisting of indust ial estates, residenrial communides, a golfand couotry club and a commercial center. This satuation may invotve special risks associaled with rhe poss;bility that rhe equity partner (i) may have economic or business inter€sts or goals thai are inconsistent with those ofth€ Cornpany; (ii) take actions contmry to the interests ofthe Company; (iii) be unable ot unwilling

to fulfill its obligations ul|d€r the Project Shlrrholder's AgrEement; or (iv) exp€rience financial difticulties. These conflicrs may adversety atract (ha Company's opamtiong. To dat€, the Comp.ny has not cxpcrienccd any significahl probl€ms with .espect to its equty panncrs.

Finsncial Risk Mrnagenent Obj€ctives rnd Polici€s (Noc 14 ofAFS) Thc Cornpany's financial insuurncnts comprisr ci5h and cssh cquiv.l€nts, shon tcrm invesinents, raceivsbl8, financial rss€ls at FVPL, AFS fin6ncial areers, accounts paFble and accrued expemcs and subEcriprioos payabL. Thc tnlin puposc ofthcse fiMncial instruments is to fimd iB own opentions and cspital expenditures. Inherent in using these finsncial instruments rre the following risk on liquidity, market and crEdit. The BOD rcvi€ws 6rd spprovcs policies for mrnaging thes€ risls. Also, lhe Audit Commine. ofthc BOD m€cts regularly and exercis€s oversight rolc h managing thcsa rilkr,

Fla,,ncbt

NttJ

Thc ouin financial

a Ltqutdiv

risk adsing ftom

the Company's financial insmncnts sre liquidity rislq tnartct risk and

qld

nsk.

Risk

Liquidity risk i! tha risk that thc Company is unable to mcet its financirl obligrtion wh€n due. The Company hss substantial inveshents in shafts of stock which arc not lisiad in the Philippine Slock Exchange and mly not be readily convertible to liquid

a$.ts ncc6sa4/ to meet any potential additional liquidity raquircncnts ofthc comprny. Inveslnents in unquoted equity s€corities included in AFS inv€strnenls amounted lo P494.53 million and ?122.00 million as ofDaalmbcr 31,2017 3nd 2016, nspeclively.

The Company monitors its cesh position snd overall liquidity posiiion in rssessing its €xposur€ to liquidity risk Thc Company msintains a level of cesh and cash equivdents deem€d sufiicient to dnroce oFmtions rnd to mitigate thc eff€cB of flucluation in cash flows.

Tlre Comp&ry's accounts payable and sccruad cxpansls

al! all s.ttlcd on a monthly b.sis.

Subscriptions payablc ar€ payabl€ on

demand lnd rre non-inlerest bearin&

Pleis€ refer to the 20 l7 AFs, Note | 4 fo. the maturity profile of the Compony's Financial Assels and Liabilities. b.

Ma a Risl

Market risk is the risk of loss on future eanrings, on fair values or on futur€ cash flows tlat may rcsuh tom changes in markct priccs.

Thc value ofa financial insEunent rnay chsnge as a resull ofchanges in inter€st.ales, for€ign currency €xchatues lates, conunodity priccs, equity prices and olhcl markdt changaa. Th. compary's mark€t nsk elnall'tes iom its holdings in debt and equity secuiri€s.

Thc Compahy closely nonitors the prices of ia debt snd equity s€curities 6s well as macro€conomic and entity-spccific factors which could di&ctly or itdirlctly affac( tbc pricls ofthese instnrmcnts. In clse ofsn expccled d€cline in its ponfolio ofequity s€cudti€s, lhe Compsny ltldily dispoAes or trades the securities for replacement with morr viable and less risky inveshenB. Eouiw Pric. Rbk Th€ Company closely monitors the pric€s of its debt and cquity srcuritr.s as wcll as m{rcrocconomic shd enlity-sFcific hcloB which could dircctly or indirccdy afled the pric6 oftb€3e imtruments. In crse ofan €xpectad dacline in its portfolio ofequity securities, th. CompsDy rE dily disposcs or E dcs th. s€cuitics lor rcplacemen! with more viable 6nd lcss risky invesnnenli

such invesment securiti$ ale subject ro price risk due to changes in narkct valuas of instruments arising either from ftcloB sp€cific to individual inshnncnls or their issucrs, or frctors afTecting all imlruments Faded in lhc m8*et.

Inter€st Rate Risk

Thc Company's cxposurs to market risk for changes in fixed inrer€st rar€s relate3 primarily to lhc Company's mon€y market plscem€nts ard dcbt s.curiti.s.

Therc is no other impact on the Company's equity other than thos€ alr€ady offccting nct incomc c. Credit Risk

!

Cr€dit risk b the risk thar one party to a financial instrunent will fail to dischargp.n obligltion and cause lhe other party to incur ffnancill lo3s. With respcct to crEdit risl rrising from cish and casll equivalentt rclcivsblcs, financial assets al FVPL and AFS fin6ncial alscts, tha Company's cxposurt to cr€dit risk is equal !o lhe cffrying amouht oflh€se insslrmenti Tha Company limits its

t1 credit rbk on the3€ a$ets by dealing only wilh repuirble counterFnics.

As of Dec€mb€r 31, 201?

ad

2016, lhe canying valucs of tha Corhpany's financial insEumcnls rrFtsent msximom exposurc as

of

repor'ting date.

wilh r€sFct to c&dit risk arising ftorn th. othcr financial assets ofthe Company, which comprbc of financial as.eeB at FVPL, cash in bsnk. short-trrm investrnents rnd AFS flnancisl rssets, thc Company's exposurc to crcdit risk rElates to defalh ofthe counter party.

PLasc rcfar to Notc 14 ofthc 2017 AFs for the maximum cEdil

isk

on financial insnments.

Thc Conprny has a wclliefincd cr€dit policy and esrablished cr€dit proccdues. ln additioD teccivabla balarces .re being tnonitorad on

a

rcgolar b€3is to ensu€ tim€ly execution ofnec€gs8ry intcrvention efforts.

Crplt l M.nar.[ctrt {Not 15ofthcAls) The primsry objective of dtc Company's c5pitd nanaggnart is to ensuE th.t it maintains a slong cr€dit rating and hedthy copitdl Etios in order to suppon its business &nd maximize sharcholdets' value.

The Company nranagas its capitd st'uciur! and nakes adjushcDts to it, in light ofchange3 in economic conditions. To maintain or adjust the crpibl struct|lre, the Compsny may adjust lhe divid€nd payncntto aharchold€rs or issue new shaFs. The Conpany monitors crpital using a debt-to.equity rstio, which is lotal debt divided by tobl equity. The Company includcs lvihin total detr th€ following: accounts po',able and eccruad c4rnsca and subscriptions payablc. Total €quity includes capiial stock, net unRrliud gains (loeees) on AFS financial ass€6 and r€iained e$nin$ (deiicil).

Thc Compony has no extemally irnposed capitil rcquitctncnts as ofDeccmbet 31,2017 and 2015.

Thc table bclow denoostsrles the debt-to-.quity ntios ofthe Company as of Doceinb€r

AccounB Ddysble snd accrued

€xpens€s

Total equity: Capital

stock Ner unrealized gains on AFS financial assets Retained eamings

3 |,

2017 and 2016, raspoctivrly:

F710,75,1

F563,640

fl63'm0,00 P163,000,000 359J42,437 42,N1 221 l9,0El.D3 4,,+09,426 I

rbh-rMnituBri^

O-ml-3:l

0-m27:l

Thar€ wcre no changes in the objectives, policie3 o. p.ocess€s for the yetrs ended Dec€mbcr 31,201? and 2016

Ia.o 3 -

L.r.l Pro.c.dlnt3

TherE 6r€ no pendbg lcgal procradings to which lhe Compahy is party or

*hich any of

its pmperty is lhc subj€cl

Itcm a - Submilrion of Mrtt€B to

.

Voa. of S.curltv Hold.r3

Therc were no malters submitt€d io

r

vot€ ofsacurity holdaF during lhe four6 qusder oflhc fiscal year covered by lhb r€pon.

IE

PANT II

r)

Mrdct

1.

Prlcc of

-

SECURITIES OF TH.E R.EGISTRAJ{T

.rd lxvldand! o. R.iblrrnl'r

Comoon Equlty

..d

Rchtcd Sloclloldar

Mrtl.ri

M@ta lrfom@lon Stock Mar*.( Pdcc

ed

Dividord on Rcgist"snt's Cornmon Equity (lan 2 yairs) 20

3d

20t6

20t7

2016

20t6

2017

2017

20r 6

P1.00

P1.00

Pl.o0

Pl.00

P1.00

Pl.00

P1.00

P1.00

4.92

2-45

3.t4

2.46

3.m

2,90

3.34

2.50

2-87

2-58

2.21 2.t3 2-61 4.57M .st?M 6.57M l. !49M 2.413M 31.49M .53tM t.t2M Thc Conp.ny's common equity is lrded in lIl. Philippinc Stock Exobugp (PSE).

2.53 2.15M

0.t28M

2.21

2.55

2-O5

Holden As of MarEh

3 | , 20 | E,

lhc Corp{Dy hls 4,70E 3todhold€rc.

20 of3l Mtrth 20

Hcrludcr F tha lilt ofiha

l. rcD Nominec corDoration (Filioino)

Conmon

2. P.n Malayar Mant & lnv. CoTD.OMMIC) 3. Abons CoNolidat€d Resoures. Inc. 4. china Bankhc CorDoratiou T/A-SCA+0010

Common Common

Comnotl

14.178-625

t.1V/o

5 China Ba*hc Co.Dor.tioo T/A-SCA-fln 6. House of lnvHtnenb. Inc. 7. YuchaEco. Alfotrlo T.

Common

t02tx.l20

6.26vo

Comllon

1-691.613

2.840/6

Conmon

r283.348

0.79/.

Common

l-92-093

0.u%

Comnon Comnon

571-427

0.350/.

556.t22

O.34Vt

Common

290.569

O.IE%

Coolrdl

2t1.644

0.lt%

Common Common Cofilrnott Common

211.244 214.104 t95.594 t86.637

o.t7.h

Comnon

t59.89

0.10./.

Comon

t47.850 147.655

o-uta

||

t.

Hvdra Manracnrcnt & RffourE€3 CorDoration 9. Chim B.nkinr CorDorslion T/A-SCA400 | 3 |

0. Chim Bankinr CorDoration T/A-SCA#O FCD Nomince Comonlioo fNF)

|

2

ll

12. On& Clancntc 13. Paaifc Bssin S€c. Co.. ltrc.

14. Floir€ndo. Antonio O. 15. Poz. W.ltcadLo

R de la

16. A.T. Yuchcnsco. Inc. |

7. Pua Yok

It.

fur ll,

Mrdr 3l Pt.00

HiSh

2.

20t7

Binr

Itcv.6. Victata S.

Cornnon Sritirso. violcb c.

ComooD 20. Kensicton Mduramst CorDo.rtion Sub-Tot l Olh.1!

Gr.nd Told L Nw of rtE lbldd. of d|. Conptry'i common itr!6 rltinstd ur.L. tlE nft 19.

Cdplrrl6l||Mslitls.

2.Ih.cdDorn |l,r

cm Cnrim

ol PMMIC

f!

ctricd

of ttE CmDoy, r.rs of Atoi$ Colr$li.lrd

3. TIE olpor.lc h dE curttrn PrBi.|.dt

ofdE CorDory.

4. CBC T/A-SSC,0OIo .nd T/A-SSCr(x)l

co.Dorn rt3 of cBc CBC

t!

Prt3i(b &d CEo.

cdiql dt

dt ly

it3 B@rd of

Rdrc.s

lrc.

Dillclors

a! c$i.d ot!

I c Tdl A.dnt

by iE

afid

d

of Dl!cl!r3

Dy

6.407.122 30.469.t5t

40.74% 18.69/o

15.5,14.911

9,SrrYo

|

0,13lr/..

0.tu 0.ll% O.Wo 0.08%

3E.207

l16.99,(5{6

l(n5.454 r63.0(n.0(x) of rcD o\lrs ord!

l[tr

MJ||tcriq|! Attbli&r Hdd nt Bord of

Y.

q!,tav.

942% lffiU. 5!t of th.

D.. b lic

DiEld' Mt Tan! l. Alcc tr

b.lIE.n Cntu Bt|tins

CdFrnid a Trutr4. Tlr

lrd M.nrFE - w- Ri*do

R,

cno! is lh. c||!Ml

20tE

Pr.00

2.5t

l9

3.

Dividends In accordance with the Corpontion Code ofthc Philippines, the Comp€ny intends to dcclare dividends (eilher in cash or srock or both) b tbe ftt,Ie. Sharcholdcrs of tha Cornpany at€ etrtrded to rcc€ive a proponionarc sh3r€ in cash dividcnds tbat may be declarcd by dlc Bo6rd of Dira€lors out of surplus profits derivcd fiorn d|a Company's op€rations. The ssm€ right existJ with r$pect to a stock dividend dre declaration of*trich is $bject to thc approval of slocklolde.s reFesenring at les3! two-thirds (2,3) of $e oobtanding dEr€s eolitled o vote. Thc amou$ of divid€nd will d€pend on dte Company'3 profits snd its c.pital €xp€nditw€ and investnent rEquirements !t lhe

r€l€vanl !ime.

The Conpatry did nol d€cla&.ny crsh or stook dividends

h th€

Iasr

two (2) fiscal years 2016 and 2015.

The l6st stock dividend (15%) *as paid in | 997. Prior to t 997, thc l.st calh/stock dividend paid w65 in 1990.

4.

Rece

sale of Utregktered Secuities

Ther€ was no sal€ ofunregistered s€cuiti€s for th€ past three years.

5,

Mininwh Pubhc

6ne6hip

The Company is compliart with the rcquired Minimum Public OwreNhip ofat least l@/o ofth€ total issuad and oubranding capital stoclq as mandated by S€ction 3, Article Xvlll ofthe Continuing Lisring Requirenents ofthc Listing and Disclosor€ Rul€s. As of M.rch 10, 20 | 7, the Company's public float was 80.0370.

b)

D.!.rlplior ofRcgirtrr 'r S.c[ritl.3

l.

Comrnotr Stock

Thc details oflhe Compsny's crpital stock rr€ 3s follows:

Aufiorizcd - (P | .0o par value)

3,

Debt Secudties - Not Applicable

4.

Stock Options - Not Applicable

P388,0,00,000.00

20

PART

III

. fINANCIAL INFORMATION

It€m 6- Mrnrqement's Dfuc ssion and Anrlvsisor Phn

ofopcntlon

Manrg€nent's Discussion Nnd An{ly3is of Finrncirl Conditioos rod R€.ults of Operrtions

l. Financial Condition

(As ofDeccmber 31,2017 and 2016)

3l-Dec-l7

3

l-Dec-l6

%

Change

% Asset

ASSf,TS Cash

&

cash €quivalents

P8,651,880

Pt 1,725,218

-26.21o/o

1.43Y.

62,445,291

47,453,72].

32.43%

10.4tvo

t3.897

- 16.58%

o_o40/o

900,200

826,135

8.97v.

0.15%

530,900,206 603,559,435

149,655,296 209,974,281

254.150/.

Financial assets at fair value through

26l,t5t Available-for-sale fi nanc;al assets

TOTAL ASSETS

3

187

.44./o

87.96./.

100.$./0

LIABILITIES AND AQUITY

Defeffed lax liability

6t,025,151

563,640 26.100/0 O.l2o/.

- 100.00% l0.ll%

TOTAL LIABILITIf,S

61,735,905

563,640 10853.07% 10.23%

Accounts payable and accrued expenses

EQUI'I'Y I-O'I'AL LIAITILITIES ANI) EQUITY

71o,154

s41J23,530

209,4tO,64l

t58.140/.

P603,559,435

P209,974287

187.44o/o

89.1"1v.

100.6)0/o

Toral assers amounred to P603.559 million as of Dec€mber 31, 201? compared to f209.974 million as of Decernber 31, 2016. Tbe significant increas€ is mainly due to the fair v.lu€ rc'm€asuremenl of the investment in HEDC shares based on crrnent ma*et valuation (ofthe land held for sale ofHEDC)The Company's cash and cash equivalenrs amounted to P8.652 million and Pll.?25 million as of Decernber 31,2017 and 2016. resfrectively. The 26.21% n€t decrease was due to incuned expenses for the ycar and additional investment in Government Securilies.

Financ;al assets at fair value throrgh profit or loss amounted to P62.845 million and P47.454 million as ofDecember 31, 2017 and as

of December 31,2016, respectively. The 32.43% net incr€ase is due to positive movement in the market values of inv€stments jn stocks traded at PSE. Receivables account as of December 31, 2017 amounted to P0.262 million compared to P0.314 rnillion as of December 31. 2016.

The | 6.58% net decline accounls for the collection of outstanding recaivables.

other current assers consists ofprepaynents. prepaid tsxcs and input tax carry-overs. This anounted to P0.900 niltion and P0 826 million as of December 3l, 2017 and 2016, resp€ctively. The 8.97% nel increase in this accotnt mainly represents additional i[put taxes r€corded during the period.

Available-for-sale financial assets account as of Decemter 31, 2017 amounted to P530.90 million as compared to P149.655 million in 2016- The bulk ofthe 254.?570 increase Denaiff to the fair valoe measuremenr of the HEDC shares. The Conpany recognized an addilional P372.516 million u ealized gain on fair value changes ofthe investnent in Hermosa. Please rcfer to Note 8 ofthe AFS.

2l AccounB payable .nd accrued expenses amounled !o F0.? | | and m.564 mill ion as of December 3 | , 20 | 7 tnd Decemb€r rcsp€ctivcly. Thc 26.l0% nei incr.ase in this account is duc to higher accrual ofprofessional fees and other expenses,

3 |

, 20 16,

Thc Company rccognizld dcfcnad tax liability amounting to P61.03 million r€lative to the 15% deGFed tax oo unrealized gEins on untraded shares ofstock classified as AFS financial aslats.

Total Stockholders' Equity ss of December 31, 201? amount€d to P54l.t3 million or P3.32 book value per share ss comp6.ed to P209.4 | | million or P|.285 book value per share &s of December 3 l, 201 6.

The follos/ing liquidity and profitability ratios indicate acceptable lcv€ls offinrhcial condition and performance ofthe Company:

3l-Dcc-l7 u.rent Ratio

102.228r1

Dch-Equity Ratio

&minrs

Der

Sh'Ic

The decrease iD cunent

0.1l4:l

3l.l)...16 t0?.016:

ForDula I

fod

Cun€nt Ass€rs/Total Cuflenr Liabilities

n.9501

0.003:l Liabilitl.s/Tot6l Saockholders' Equity 42.53 lncome/Tobl Revenre

l.l l4:l

1.003: I

m.09fi

Iotsl

Asb/

Total Eouitv

Revenue/Toral Ass€rs m.0387 Ner Income rs$red & Oulstandina Sharcs

ntio and increase in dcbraquily ratio is mainly

dua to the increase in

cultlnt liabilities.

Net pmfit margin snd EPS increased mainly due to positive m&ket valoe movement of invesments in FVPL tradad in PSE. Thc decrcase in ass.t tumover is mainly due to lhe incre&s€ in assets during the period.

Plaasc rcfar to Financiol Soundncss lndicators for additional KPI'S

ofihe Company.

The only material commilnent of thc Company is the bal6nce on its subscripdon to HEDC in the amount of P12.354 rhillion. The liquidity ofthe Company will b€ afferkd ifHEDC declares a call on said subscriplion. Possible sourc. offtnd is thtough bank losn.

Aside from lhe subscriptioo payabl€ to HEtlC, lhere u€ no known f€nds, dcmsnds, conunitrnenls, events or unccrtainti4 that will h6ve matrrisl impact on thc Corhpany's liquidity.

Th. Philippinc cconomy is still .fccled by economic crisis, rcsulting in fluctusting foreign exchange mres and increasc saock markct uncertainties. Uncanrintiaa ramain as to whather thc country will continue to b€ afrected by regional trends in the coming months.

The finsncial starements do not include any adjusonents that migllt resull from these mc€rlainlies. Relaled efrects will be reported il| the financial ststemenls, as they b€come known and estimable,

22

2, Res||lt! ofOperations (For ihe years ended December 31,2017,2016 and 2015) o/d

31-Dec-17

I l-D€c- l6

3l-Drc-i5

Change

o/o

2016vs.2015

in

Toal

Relenue

R'Vf,NUf,S Nel Sains on ftir value chan8es on financial a5seb 6t hir vaiue througi prot Dividend incomc Other income-n€t

ToTAL REVENUES

&OS$

COST AND IXPENSES cel|eml& administrative Nel loss on fah value chsnges on financiel &ssets at

I5J87,0{8

126.160/o 953q/,

6.803,522

294:n3

353.401

8,250,179

965r6

124,111

234.403

1.633.971

8,837,519

16,110.614 1y's1,900

t.326,412

-16.61'/o 22.61o/t O.Otrlo 111.30/o

t.830/,

0.68/o 2.18% 100.00/o

t.440,389

9.460/0

9.00%

12,253,726

0.00%

0.wo

4,62t.872

0.0070

0.00%

523

0.00/o

0.000/o

lair value lhrough prot or loss

lmpairm€nt loss of alialable-for-sale financialass€ls Nel €alized forax loss (gain) TOTAL f,XPENSES

lnaona./1l63) bafora lncom.

Provirion for incone

!.I

t,451,900

tr

14,618,1t4

1,047

9.460/o 1,326.412 r8.316.5t0 (9.478,99r) t32.72% 6307,559

1.Ul

1.047 0.00/o

9.00o/o

er.00% o.Mt/o

OTHER COMPREHENSTVE

rNcoME(LOSS) Net un€alized Bain (loss) on available-for sai€

s€curhies

3l1J4l2l6

Iransfe6 to profil and loss

TOTAL COMPRXHENSIVE INCOME (LOSS) TORTHD YEAR

PJ32"4t2.88J

i?,560,517

(10.322,6,,2)

4.Ot,871

P43.861.049 {P15.186.808)

-145.94o/o

100.00/0

{57.880u0

The Company posted a n€! incom€ ofPl4.672 million or P0,09 €amings per shar€ as of Decernber 31, 2017 as compared to P6.301 million or eamings per share ofP0.038? as oiDecemb€r 31, 2016.

Net gains in the changes in market values (fair value changes in on financial ass€ts at fai value through profil or loss investments) amounl€d 1o P I 5.387 million and P6.804 m illion as of December 3 I , 20 I 7 and 2016, respectively. Th€ | 26. | 6010 net increase p€rtains to positiv€ market v.lue changes in the investments in stocks traded in ahe PSE.

Dividend income declined fron P0-353 million in 2016 to P0.295 million in 2017. The 16.61% decline is mainly due to lower dividends declared from the invesunents in stock during the penod.

Intercst income amounted to m.097 million and P0.125 million as of Decenber decline is atribuied 10 lower balance ofthe reinvested cash eauivalents.

ll,

2017 and D€cemb€r

3l.

2015, rcspcctively. The

Other income as of December 31, 2017 and 2016 p€nains lo recuninS service income for accounting servic€s rend€red by the Company to IIEDC and rental income. ceneral and administrative exDens€s amounted to PI.452 million and P|.326 million as of December 31,2017 and Decemb€r 31, 2016, respectively. The 9.46% increase is due to higher expens€s during the period.

23

Provision for income tax pertains to the Minimum Coryorate Income T&y (lvlclD sei-up. The Company set-up MCIT mthet than the 30% regular tax because most of its income are ftom unrealizcd market cbanges of investn€nts and passive income subject to final

Bulk of the net unrealized gain on available for sale securities pertains to the fair value measuremcnt of the investment in HEDC shares (Note 8

ofthe AFS).

3, Finxncial Col|dialons (As ofDeccmber3l,2016 rnd 2015) Total asseb amounted to P209.974 million as ofDecemb€r I l, 2016 compa&d to P165.865 million as of December 3l,2015.

The Company's c&sh and cash equivalents amounted to Pl1.725 million as ofDec€mber 31, 2016 compared net decrease was due to incuned expenses for the year.

to

P12.036 tuillion as

ofDecembe.3l, 2015. The 2.58%

Financial ass€ts al fair value through profi't or loss amounled to P4?.454 million and P40.650 million ss of December 3l,2016 and as

of December 31,2015, respectively. The 16.74% net increase is due to positive movemenl in lhe marke! values of investments in slock t'aded at PSE panicularly Aranela Propenies lnc. (tom l.l2lshare to 2.35lshare) and EEI Corpordtion (fiom P5.40/shar€ to P6. | 2/share).

Receivables account as of Decemb€r 3l, 2016 amounted to P0.314 m;llion compared to P0.315 million as of December 31, 2015.

The 0.43% net decline accounts for the collection ofoutslanding receivables.

Other curcnt asset consists of prepayments, prepaid tax€s and input tax carry-ov€m. This amounted to P0,826 million and P0.769 miflion as of December 31, 2016 ard as of December 31, 2015, respectively. The 7.41o/o tet increase in this account mainly represents additional input taxes recorded durinB the period.

Available-for-sale (AFS) financial assets account as of December 31, 2016 amounted ro P149.655 million compared to Pl 12.095 miliion as ofDecemb€r 31.2015. The bulk of the 31.5 I % increase pedains to rhe resta&ment of thc Hcrnosa shares ro its fair value using th€ adjusted net asset value method. The Company rccognized P34.30 million unrealized gain on fair value changes of the investnent in Hermosa.

Accounts payable and accrued expenses arnormted to P0.564 million and P0.315 million as ot Decenb€r 3l. 2016 and December 31, 2015, respectively. Th€ 78.65% net increase in this ac.ount h due to higher accrual ofprofessioMl f€es and other expenses. 'l otal Stockholden' Equiry as

of Dec€mber 31, 2016 amounted to P209.41I million or P1.285 book value per share compared to P165.550 million or Pl.016 book value per share as ofDecenb€r 31,2015.

4. R€sulti of Operetions ( For the yerrs end€d D€cenb€r 3l,

20 | 5 r nd

2014)

The Company posted a net income of P6.301 million or eamings p€r shar€ of P0.0387 as of December P9.486 million or a loss per sharc of P0,0582 as of December 31,2015.

Dividend incom€ declined from P8.251 million as ofD€cember 31, 2015 to P0.353 million HEDC'S declaration ofcash dividend in 2015, none in 2016.

as

3l,

2016 and n€t loss

of

ofD€cemb€r 31, 2016 mainly due to

lnterest income amormted to P0.I25 million and P0.234 nillion as of December 31, 2016 and December 31, 2015, rcspectively. The decline is attributed to lower balance ofthe r€invested cash eouivalents.

There was a positive turn'around in the chaiges in market values (thir value changes in on financial assels at fair value through profit or loss investments) from a P12.254 mill;on unrealized loss on to P6.804 million uffealized gain. This is due to posilive movement in the marker values of investnents in stocks h-dded at PSE panicularly Ar6neta Properties Inc. (Fom |.l2lshare to 2.35/share) and EEI Corporation (tiorn Ps.4o/share to P6.l2lshare).

Other income as of Decembcr 31, 2016 and 2015 pertsins Company ro HEDC and ran@l income.

lo recuning service income for accounling

s€rvices rendered by the

In Decemb€r 31.2015, the Company recognized inpairmenr loss amormting P4.6 million on investrnent in PERC'S share,

24

Gencr.l and administrativc exDenees amounled to Pl.326 million and P|.440 ftillion as of December 201 5, respectively.

3l,

2016 and Decemb€r

3I,

Thc 7.91olo dec.casc is duc to lo*cr axp.nscs during the period.

There was a minimal unrealized loss on forex in 2015 resulting from r€instatement ofdollar nvcslnant

ofth.

Company.

Provision for income tsx peirins to the Minimum Corponte Income Tax (MCIT) s€t-up. The Company set-up MCIT rathar than ihe 30olo regular trx because most ofirs income arc hom unr€alized marlet changes ofinvestmenrs and passive incomc subject to final tax.

Ther€ *as a tumaround in the other comorehcnsivc incomc accou from P10.323 million un|€alized loss as ofDetemb€r31.2015lo P3?.56 million unr€alized gnin mainly due to $e restatement ofthe Hcrmosa sharcs to its fair valua using thc adjusled t|ct ass"t value method.

Except for items discussed above, therc arc no morc charges in the financi&l $arements that will resch lhe materiality fucshold

of

5o/o.

5. Fimncirl Corditiotrs (A! of D.ccnbcr

31, 20lS

.rd

2014)

Total assets amount€d to P165.865 million ss of December 31,2015 compdld to P180.992 million as of Dece.nber 3l,2014.

The Company's cash and cssh equivalents amounted to P12.036 million as ofD€cember 31, 2015 comparad of Decanbcr 3 | , 20 | 4. The 19. | 5% net increas€ \r&s due to maturity of shon-bfln invesonents.

to

Pl0.l0l million

as

Shon-tarm invasm.nts (STl) .ef!r to mon€y markel placements (MMP) wilh malodly of more than lhr€e monlhs but less than ooe year. The.e are no STI'S in Dccernber 31, 2015 as compared to P18.307 million STI as of Decemb€r 31. 2014, this is b€cause the Compshy has disburs€d a total of about Pl8 rnillion during dr pcriod for thc 2: I Stock Righls Otrer of PERC wherein the Company invested addirion.l P5.2?6 million in FVPL and P5.623 million in AFS and payment of portion of its subscriptions payable (o Hermosd amounting to P7.ll5 million.

Financial assets at frir value through plofit or loss amounted to P40.650 million and P4?.628 million as of Dec€mber 31,2015 and as of Dacanbar 31, 2014, respectively. The l4.65yo net decr€as€ is due to negative movement in ihe ma*et values of invesments in stocks traded at PSE.

Receivables accounr rs of Decembcr 31, 2015 amounted to P0.315 million compa.ed to m.?

The 56.0370 net decline accounts fo. the collection ofodstanding receivables.

l? million

as

of December 31, 2014.

(Xher cuFcnt assets consisi prepaFenrs, pr€paid taxes and input tax carryovers. This amounted to P0.769 million and m.689 million as of December 31, 2015 and as of Drcenber 31, 2014. resp€ctively. The 11.59lo net increes€ in lhis account mainly r€presents additiooal inpw taxas racordad during the p€riod.

Available-for.sale (AFS) financial assets account as of Daccmbar 3l,2015 amou ed lo Pl12.095 million compared to P103.550 million as of December 31, 2014. The 8.25% ner increse is due to the 2:l Stock Rigbts Offer of PERC wherein the ComFny subscrjbed additional5.523 shares at P4.38i/share lolallin8 to P5.623 million.

Acaours payablc and accrucd exl€ns€s amountcd to m.315 million and P0.256 million as of December 31,2015 and Dccambcr 31, 2014, r€spectively. Tha 23.27% n t incre{s€ in $is account is due to higher accrual ofprofessional fees and other €xpeoses.

Total StockholdeN' Equity as of Dec€mber 31, 2015 amountcd to P165.550 nillion o. Pl.0l6 book value per sharc compared lo P180.?36 million or Pl.l09 book value per share as of December 31,2014.

6. R6ulb ofop.rttionc (For

the

ye.F ended Deccmb.r 3l'

2015

rnd 2014)

'Ihe Comprny posted s net loss of P9.486 million or a loss per share ofP0.0582 P3.389 million or m.02079 eanings per shale as ofD€cember Sl, 2014.

a5

of D€aamber 31,2015, and a n€t income of

25

Dividend income increased from m307 million as of D€cember 31. 2014 to P8-251 nillion as of December 31,2015. Bulk ofthe incrcase was due to cash dividend received Fom Hermosa Ecozone Development Corpomtion during the p€riod

lnt€.est income amountad to P0.234 million and P0.756 million as of Deccmber 31,2015 and Deaember 31,2014, r€spectiv€ly. *as a 68.98% decrease becaus€ for 2014, aside irom recuning interest income from MMPS, this account includes int€.est on collection oflong odstanding loans receivable, while for 2015, this only includes rccurring idterest income ftom MMPS. ln addition, lower balance of the reinvesred cash equi\alents, contributed to the decline.

There

Tbe Company's net loss on fsir value changes on financial assets at fair value through profit or loss anounted to P12.254 million and P3.228 million gain as of December 31,2015 and 2014, rcspectively. The nogative variance is due to decline in market prices of invesanents in stocks lradod in the PSE.

other income as of December 31, 2015 mainly pertains to recurring serviae income for accotnting services rendcrad by lhe Cotnpany to HEDC and rental incom€. There nus a 41.66% decreas€ becaus€ in 2014. this includes one- time re.overy of long outstaiding receivables which were already s/ritten-off-

ln December 3l, 2015, the Company r€cognizld irnpairment loss amounting P4.6 million on investment in PERC'S share Ceneral and administmtive expenses amormted to P1.440 million and P1.498 million as of Decembei 31, 2015 and December 31, 2014, respecriv€ly. The 3.86% decreese is due to lower expenses during the period.

There was aminimal unreslized loss on forex rcsulting fiom reinslatement ofdollar investment ofthe Company

provision for income tax pstains to the Minimum Corporste lncome Tax (MCIT) sel-up. The Company set-up MCIT mther than the 30../o regular tax because most of its income are fiom unrealized matlet changes of investments and passive income subject lo final lax. Lower MCIT in a5 of Deccrnber 31,2015 p€rtrins to lorrcr taxable income comPared to Decemb€r 31,2014.

Other comprehensive loss amounEd to P10.322 million as of D€cemtrer 31,2015 versus oth€r comFehcosive income ofP3.2tl million as of Decemb€r I l, 2014. The n€gative tum-around is mainly due to a decrease h msrket value of investnents. Also as a sfen€d P4.622 million from other result of the 25.l6qo decline in markel value of investnent in PERC, the Company comprehensivc income to the Profit and Loss Statement.

n

Plsn

A.

ofOperilions Investmena in AFS not traded in the market (Investment in HEDC)

As ofDecember 31,2Ot7 the Company holds I i.33% interesr in its investtnent in Hermosa Development Corporatioo

(HEIr).

The Management of HEDC is taking all €fiorts to sell ponion of iis saleable propflty, proceeds ofwhich will b€ used to fmance the development ofthe undeveloped podons ofdrc property.

B.

ltrv€stm€nt in Fin.ocirl Ass€ts

rt

FVPL

lnd AIS trrdcd in th€ mrrket

The Comprny will continue to closely noniror the prices of its securities es well as those specific factors which could directly or indircctly atrect lhe prices ofthese instruments- Because such investments are subject to price risk due to changes in matket values, an expected decline in the ponfolio will pronpt the Company lo dispose or trade the s€curities for replacement with more viable and less risky ioveson€nts in the future, With the Company's curent cash position, it can sustain ih needs for ils opemting expenses. lts only possible material commitnent is a cash call from HEDC. of which is not exDected to call in the n€xt nvalve months. Thus, it does not intend to laise additional funds.

Aside from the Company's invesftents stared above, there are no other researches or development pl.ns, and purchase or sale significant equipment that lhe Comp3ny exp€cts perfonn-

of

26

Commitments Except for a possible cash call from Hermosa Ecozone Project, lhe Company has no commitment for the purchas€ of prop€rty, plant and equipmen!.

I)ilcussion ofitrdicrtors of the Comprny'! levcl of performance Receivable Management The Company manages its receivables by monitoring on a regular basis to €nsure timely exccution ofnecessary intervention efforts.

(Pleas€ refer to th€ 2016 Audited Financial Statements, Note 9 for the breakdown ofreceivables account).

Liquidity mrnaS€fteDt The Company has subsiantial inveatmcnG in sharcs of stock which are not listed in $e Philippin€ Stock Exchange and may dot be readily convenible to liqrid assets necessaD/ to meet any potential additional liquidily requirements ofthe Company. lnvesEnent in mquoted securities included in AFS investrnents amounted to P494.535 nillion and P121.999 million as of December 31, 2017 and

20t6.

Management of liquidity requircs a flow ard stock p€rspective. Constraint sLrch as political environrnent, taxation, for€ign exchang€, interest mtes a|rd other enviroimenial factors can impose significant restictions on firms in management oftheir fmancial liquidity-

Sealiont has considered the above factoB and paid sp€cial attention to its cash flow management. The Company identifies all its cash rcquircmenls for a certain p€riod and invesrs unrestricted fuods to maximize interest eamings, i,e, money market placemcob, RrtG ofr€turn ofe{ch stockhold€r Th€ company has no existing dividend

policy. However, the Company

intends

to declare dividends in the future out of its

unrestric:ted rotained eamings accordance with the Coryomtion Code of the Philippines.

Cost-reduction etlort In order to minimize expenses, the Company has engaged the services of PetroEnerS/ Resou.ces Corporation to handle its iegal, administntive, accountingandtreasury functions.

It€m 7 - Finsncirl Stltem€nls The 2017 Audited Financial Stat€ments and Supplemedtary Schadules ofth€ Company are incorpomted herein by referenc€.

Item 8 - Chrnres ln and Dbr!rcemenb with Accountrnts on Accountlnp ard Finatrcill Discl6ure As ofDecembet 31, 2017, there are no disageements with Accounlants on Accounting and Financial Disclosure.

PART

IV_ MANACEMENT ANDCERTAIN Sf,CURITY HOLDERS

ofthe Infornation Statement for the discussion on the identity of each ofCompany's direciors and executive ofticers, their principal occupation or employrnenl the name of the principal business of any organizstion by which such directors Please refer to Page 5

and executive ofiicers are employ€e.

2',7

PART V

- CORFORATE GOVERNANCE

Conpllama rvltb Lrditr8 Prrcticcs otr Corponte Govcrtrrnc€

a.

Evaluation Systern to Determine Compliance with Msnusl ofcorpoi.te Covemance The Company's Board of Direcrors and management sub6tantially adheres to and complies with the principles and best practices conrained in ils Manual on Code ofcorporate Govemance. The Company is adopting the lntegrad Almual Corpomte Covemanc€ Repon, pursuant to the Code of Corporare Covemance for Publiclylisted Companies (CG Code for PLCS), as an evaluation system for the company to me3stjre or detemine dre level of compliance of the Board ofDirectors ard top mana€ement with its Manual of CorDorata Covemance-

b.

Meosures Undensker/to be undenaken to Comply with L€ading Practices on Corporate Covemance - Among the meesur€s undertaken/to b€ undertaken to comply the Company's Manual ofcorporate Govemanc€, arc as follows:

L

Th€ attendance of€ach Director in th€ scheduled meetings ofthc goard ofDirectors is monitored and r€cord€d.

2.

The Company has Committe€ on Audit, GovemanceNomination and Compensation, and will adopt the suggestod new board committe€s under tb€ CC Cod€ for PLCs,

3.

The financial reports and reports ofoperations are thoroughly reviewed by the extemal auditor b€fore these sre released to shareholdeB, the SEC and PSE.

c.

Deviation from the Company's Manua' of Corporalc Govemance - Th€.e is no deviation ftom the Company's Manual Cooorata covemanc€.

d.

Plan to lmprove Corporate covemanc€ - Tbe Company updsted ils Manual as mandated by SEC Memomndum Circular No. I 9, series of 2016, bas€i on the CG Code for PLCS and l}ill, as far as they arE practicable ard relevant to the Company, adopt the recommendations therein. The Company will likcwisr acaonplish and submit lhe lntegrated Anlual Corpomte Covemance Repon.

of

28

C@lNot sls_E!!!!sb!lE!@

l.

Assa$ subjecl to LieD and R€sticrions on Salcs ofAssets As of Declnbcr

2.

3

l,

20 I ?, thcre wer€ no asscts

mortgaga4 pkdgpd or otherwise subje.l to licn.

Subsequent Events

tlut required adjustments on the December 31, 2017 Audited Financial Statem8nts.

There were no subsequent events

3.

Defaulb - Nono

4.

The

follo*ing arc not rpplicable in drc prep€ntioo ofthls rcpo(

a. b. c. d.

Adjustm€nB nade d|aa lead to the revenoe r€cognition but which adjusmenb c.snnot bc ptopcrly 5upportcd.

Cbsngcs in e$imstes without Foper disclo$u! which h.v€ th€ impact

oDcntionr.

Non-application

or

misapplication

of

aaaolmling PrinciPles and standads, mi6stat ments'

omissions, etc.

Other cases involving sccounting snd auditing mette6 r€sulting to possiblo cono.alnotrt fraud or the crertion ofs risk for the commission offraud

5.

Sch€dulc of Raooivable account

6.

Br€akdown ofAc{ounts pdyable and aacnrcd expansts

-

Aacoorlr

FyrbL |ld

acamad atpanac3

Totrl

As of Decernber

3l,

20 | ?, the

of a

plealc rcfer to the 201? Audit€d Financial Stateinents, Note 9

Professional fecs Other C&A rclated p&ty Trust fe€ Due to relat€d party

7.

of improving Esuhs of

P P

298,450

278Jr8 62,361 7

P

t,625

7tO,754

Corporalioo hts no rrctivabld from any offic€r, dirrclors, cmPlo)€n rclated p€nies snd

p.incipal stockholdeE.

8.

Thc ComFnny has no liability

9.

Th€re wcrE no assets pl€dg€d ogainst s€cuEd liabilitios.

g arante€d by olheig.

29

Urdartrlitrg to Prcvld. furnurl Report UPON THE WRITTEN REQUf,ST OF TI{E STOCKIOLDERS, THE COIIIPANY UNDERTAKES TO FIJRNTSH SAID SToCKHoLDER WlTll A COPY OF SEC FOR.}f r7-A FnSE OF CHARCE. ANY WRITTEN REQUFST FOR A COPY OF SEC FOR.[I.I7A SHALL BE AI'I'R"ESSED TO THE FOLI'WING:

Oftice ofthe Corponte Secretary SEAFRONT RESOURCES CORPORATION 7d Floor, JMT Buildin& ADB Aveooe

Ortig$ C€ ei, P.sig City Pursuant to thc raquircrhants of th€ Securitics Rcgulation Code, the lssuer has duly caus€d this repo.t to sign on its behslfby the undersigned hereunto duly authorizld, this day of April 20 | 8 in Pasig City

_

SEAFRONT RTSOURCES OOR"FORATION lssucr

By:

ka z-

SAMUEL V. TORRES

Coryorrc

S.cd.ryft/

-l

AIU{EX CA'

CER?IFICATIOI{ OF I]{DEPE]IDE]{T DIRECTOR$

CDIII'IIIC'AIION

INDEPIINDI.NI DII'IC-IOR

OF

I, eRNESTINE CARMnN JO DDSIDEIIO vf!,r"{RFnL-FERNAXrx} .3c &d ! Eided of 2, tLight Hill sr.eg N* Mril4 Rouins Hillr suMivision, hlvins lF6n duly sPm in &.onldre *in le do he.€by d..l@ rhc:

l Im

! nmina lbr

b€en

2.

I)MP

m .n'it rql

I

wirh

Di&lq ofSEAtRONl

Indcpcndenl

Indol'odo Diftdu

NY/ORG MTNTION

itiro, ol l.grl City.

.nd

RTSOURCES CORK)IIAU()N

Md

10,20|2

sinc€ May

6o!&i6

rtr followins

r

(!@o

o.

egsiz.rir!:

{XITION/RELATTONSIIII

sf,RvIcl: loudd Bbk6|rsrllac :rounrry BankcB

ildon MrtinDz

LiL lrbudoc

f_Lres

.do

Femando

ICBC

Fod Rr.*6

rP

Pcdro

CdD.

l'<t l}Yelopmd

:l

iid

Por€egr R.nlils

Corrbraim

atl rhe.Fdlific iom md noft ortnd {tisqurlificalions b sNc N d lnd.od enr t)iredor of SEAFRONT RESo(TRCES CORIORATIO\ r\ pmvi{ted tbr .n seclio lN ol lhe $€c[iti6 Rc8lllrion Code, ns Implcncnting Rule a R.gulidoa ,nd ot[or SEC

rposss

4. r

d

nol d.rcd (o rbc folo*ins

RD.SOIJRCES C()RPORA]ION ils providd un&r rh. RDI. ]f,2 3 oftn.

5. lb dF h.$

or

ny

knowlodso.

I

iNerliE.rio. or pre.ding

6 Im

nol in SovennMt

pnie

diM/ofrcrtsubn di.l she[oftLr of sUAliRON l subsidiriB dd dnl €_ orh{ tho lhr Nldidship S.curni* R.guhio. Co<i.

d et

or

m

thc

sbjd.r of uy rmdins odmin.t

atfiliareJ wi$

tr

gov€mnenr agenc]

(

{dminisrElivc

d c()cc

7. I shall arirbruy {n diliscrdv conply sirh ny dnj6 od rcsposr'bihics s tldcpodcd Didor und.r lh. Seuiris Reguldion Cod. ri ils lmplemoans Rul6 ad RcguLrnss_ c.d€ of C.rDtr& C.vm'lR rd dlE. SFr

'su:tri

19.

I shal inlom ltD Corponlc Ssla4 of SL ]RONI RISOURCITS COR?OR llONofuy .hde.s in rlE r$ov.-menlion.d infomdion wnhin five (5) days fon iis ecuft..cc

r,.*,i

APR 1 1

2ol?

plste

.X' DF.SIDFTIO VII JARFAI-FERNANIX'

sI[rsC]RIaED AND swORN t, lrea,'.. hd TrN rlr-371-21i5

cxnibilcd

l'agcNo 5

-.

'ni.

APR

CERTIFICATION OF INDEPENDENT DIRECTOR l, Nicasio I. Alcantara, Filipino, oflcgal agc and a resident of#l l-amarind Road.

Forbcs Park. Makati City, aller having been duly swom to in accordarlce $ith la\\ do hereby declarc that:

l I am a nominee for Independenr

Dirqcror of SEAFRONT RESOURCES CORPOR^TION rmd bccn Indcpcndent Director sincc May 1995. I am alliliated $ith the following companies or orgmizations:

COMPA.I{Y/ORGANIZATION

POSITION

PERIOD OF SERVICE

Aces Technical Scrviccs. lnc.

Pi*!to'

July of 201

AcilCorporation

Director

Novcmber of 1987

Director

April of 2012

Alcor Tlansport Corporation

l)irector

Iebruary of 1974

Alecal Corporation

Director

Ocl of l9ll9

Alsing Power I loldings. lnc.

Director

May

Alsons Aquaculture Corporation

l);reclor

May of 1988

Alsons / AWS Infonnation Syslem. lnc.

Direclor

Ma) of 1997

ACR Mining Corporation

Chailman & Presidcnt

Alsons Corporation

Director

1!E!t!319'-"

Alsons Dcvclopment

r"".

&

Investments

Corp.

Alsons Land Corporalion Alsons Power Iloldings Corporalion

of

201

I

I

Scplcmber ol'20 | 7

April of I995

Direclor

Deccnrber

Director

Novcmber

of I 962 of 1994

.I)irector

Decembcr of 201 |

Alsons Properties Corporation

Director'

No!cmber ol l997

n lsons Securitt Co., Inc.

Director

ry."", ry1nol B!!Cr!"'p.

l)irecrcr

Alto Po\r,er Management Coryoralion

I)ireclor

Aquasur Resoutces Corporation

l)irector

Aviana Developmenl Corporation

Vice-Chairman

Bl)(} Privatc Bank. Inc.

Dircclor

Bua)'an Caltlc (--o.. lnc.

Director

Buhcnin Agri. I'arms. lnc.

Direclor

Casa Sonoma Agri Farms, Inc.

Director

.

May of20l3

ol 20l5 November ol 20l6

December

June

of 1987

March

of20l5

Septenber of 2009

of 1978 Apfilof20l2 Aprilof20l2

Januar,

Colina de Conrado Farms. Inc.

Director

Aprilof20l2

Conal Corporation Conal Corporation

Chairman

I)ircctor

May of2006 July of 1984

(bnal Holdings (brporation

l)irecror

May of 201

I-idicon Corporation

I)irector ('hainnan &

Fial Corporation

of I989

Ocrober Oct

I

of

1989

Piesident

Finfi sh Hateheries,lnc.

Dircctor

May of1996

Indophil Resources NL

Direotor

Dcccmber of 201I

Kennemer Foods International

Director

June o12013

Lima Agri Farms. Inc.

Director

April ot2012

Niacor Corporation

Chairman

&

October

&

Ma1

of | 989

President Punta Properties. Inc.

Chairman

of

1997

President

of

Roscal Corporalion

I)irector

October

Sagittarius Mines. Inc.

I)ircctor

n ugust of 2015

Samal Agricullural Dcv'1. Corpomtion

l)ircctor

October

San Ramon Power. Inc.

Dircctor

Sarangani Agricultural Co.. lnc.

Dircctor

Sarangani Energy Corporation

Dircctor

July of20l2

lloldings Incorporated

Direclor

SoL[h Srar A\iation Corporation

Director

Sunfoods Agri. Ventures. Inc.

Director

oI20l3 Dccember of 1990 Oclobcr of20l2

Site Croup International. Ltd.

Director

Oclobcr o1 2010

Seawood

1989

Jul) of 20l2 Oclober

of

1967

January

May of20l I

Southcm Philippincs Power Corporation

Thc Philodrill Corporation 'lruslo Corporatiorl W!-"itern Mindanao Powcr Clorporation

of

1989

December

of l99l

October of 1989

Ilirector

Mal of 20l

I

I posscss all thc qualifications and none ofthe disqualifications to sen'e as an lndependent Direclor of S|AI:RONT RESOURCES COR-PORATION, as providcd lbr in Scction 38 of the Securities Regulation Code, its Implementing Rules and Regulations and other SEC issuances.

3.

I

am not related to the following director/officer/substantial shareholder ot' SEAFRONT RESOURCES CORPORAION its subsidiaries and affiliates. other than the relationship provided under the Rule 38-2.3 of the Securities Regulation Code.

4.

To the best of my knowledge,

I am not the subject ofany pending criminal or

administrative investigation or proceeding.

5.

I

am not

cocc.

in govemment seNicc or am alfiliated with a govemmcnt agency or

t shall faitMully and diligently comply with my duties and responsibilities as Independent Director under the Securities Regulation Code and its lmplementing Rules and Regulations, Code of Corporate Govemance and other SEC issuances.

7.

I

shall inform the Colporate Secretary

of

SEAFRONT RESOURCES CORPORATION of any changes in the abovc-mentioned information wirhin five (5) days from its occurrencc.

I3

Mfi Done.rhis_dayof.ar APR

.Phitieeinh

u--rffi /

NICASIO I. ALCANTARA Affiant

SUBSCRIBED AND SWORN to before me rhis APR 1 3 2018 day ol' , affiant personally appeared before mc and exhibited his Passpon P2285039A issued on 13 March 2017 by

Doc.

\8 No.-S-:

Page No.

? l8

Book No. Series of20

:

; .

I)tA Manila.

STATDMENT OF MANAGEMENT'S RESPONSIBILITY FOR FTNANCIAL STATEMENTS ADril I l. 2018 S€curities and Excha.ge Comnissio.

PICC. Roxas Boulevard, Pasay City

The manag€ment of Sslront Resou.c6 Corporation is responsiblc for the prepamtion and fair presentation ofthe financial sralemenrs includina the schelules anached thefein, for the years cndcn D€cember 31,2017 and 2016, in accordanc€ with the pr€scribed financial reporting fram€work indicat€d th€r€in. and for such intcmal contol as managem€nl determin€s is n.c€ssary io enable the prepamlion offinancial statements thal arc ji€e iiom malerial misstatemenl, wheaher du€ to fraud

ln preparingthefinanoial siatements, managcmcnt is rcsponsiblc forasscssinglheCnmpany'sabiliryto co inueaagoing concem, disclosing, as applicable matters related lo going concem and using lhe going conc€m b€sis ofaccounling unless management eilher intends to liquidal€ the Company or to ce$c opedtions, or hd not realistic ahernarive but to do so.

The Bo€rd of Diredors is rcsponsible for overseeing the Company s financial reponing

pr@s.

The Ao6rd of Dirqlols reviews and approves the financial stdcrncntr including the sch€dules attached lherein, and submi$ tfie sme to the stockholdm or memb€.s

Sycip, Gones, velayo & Co., ihe ind€perdcnr auditor appoint'xl by the srockholdeB, hd audited the financial stat€ments ofthe company in acc.rdanc€ with Ptilippine Standards on AudilinS, and in ils .epon to &e stockhold€rs or metnbers, has exprcsed ils opinion on the faimess ofpres€nlalion upon compl€lion ofsuch audil.

Mifagro{Jv. Rcye Presidenl

ApR

II

?0le

pASl6 glTV

suBScRTBED AND swoRN ro me beforethis Affants exhibited to metheirTax ldentification Numbers {TIN) indicated below each name.

NAMES

llN

Robeno Jose L. Caltillo Jr.

100-562-982

Milagros V. Reyes

100-712-775

Perry Y. LIy

r00-56t-055

",

Li0c

No. 5Z Pase No. lok Book No. I

:

Doc.

S€ries of 20

|

fl: I,lL ri.:,r, r.Ciie.

ol Fesr3,

;r. l r.is $$ c oiriryol Fale/ca

ioP rio !:!0n5; 0lr10rl8i RSfi NCiE Conrr€ide [o. V.0022169; C!]0fi 6

;

l

B

SEAFRONT RESOTJRCES CORPORATION