REPUBLIC OF THE PHILIPPINES

~anniBanha~anQuezon City

REPUBLIC OF THE PHILIPPINES, CIVIL CASE NO. 0009Plaintiff, For: Reconveyance, Reversion,

Accounting, Restitution andDamages

CABOTAJE-TANG, P.J.,ChairpersonFERNANDEZ, SJ, J. and

JOSE L. AFRICA, ET AL. FERNANDEZ, B, J.Defendants.

This resolves the Urgent Manifestation -and- Motion forAppropriate Reliefs (herein-below described? filed by Victor Africa.

Victor Africa prays that. this Court (1) order EasternTelecommunications Philippines, Inc. (ETPI) to cease and desist fromholding any stockholders' meeting until and unless this Court calls forone; and (2) order the Presidential Commission on Good Government(PCGG) to cease and desist from representing and voting thesequestered shares in any ETPI stockholders' meeting until and unlessit has shown that it has passed the "two-tiered test."

Victor Africa av~ ~

'D,ted Septemb., 6,2017, filed Dn Septemb., 7, 2017 ftD

RESOLUTIONRepublic. vs. Africa, et al.Civil Case No. 0009

1. He has an interest in the validity or regularity of the ETPI stockholders'meeting to be held on September 12, 2017 by reason of the following:

a. He is an ETPI stockholder;b. He is the President and the biggest stockholder of Polygon

Investors & Managers, Inc., which holds 18+% of the ETPIshares; and

c. He is an heir of Jose L. Africa, who held 2+% of the ETPI shares.

2. The Corporate Secretary of ETPI issued the Notice of the Meeting of theStockholders of Eastern Telecommunications Philippines, Inc. datedAugust 30,2017, stating that an ETPI stockholders' meeting will be heldon September 12, 2017.

3. In the Resolution dated July 6,2017, this Court stated that it has startedto implement the Supreme Court's directive in G.R. No. 184636.

4. The proposed stockholders' meeting on September 12, 2017 pre-emptsthe Sandiganbayan from implementing said directive.

5. The Supreme Court, in BASECO v. PCGG laid down the parameters forthe voting of the sequestered shares. It was held that the PCGG cannotvote the sequestered shares, except when there are demonstrablyweighty and defensible grounds or when it is essential to prevent thedissipation and wastage of corporate property.

6. In Cojuangco v. Calpo and PCGG v. Cojuangco, it was held that thePCGG may vote the sequestered shares if the two-tiered test is satisfied.First, there must be prima facie evidence showing that the shares are ill-gotten. Second, there must be an immediate danger of dissipation, thus,necessitating the continued sequestration and voting by the PCGG whilethe main issue is pending with the Sandiganbayan.

7. The Court must approve the voting of the sequestered shares by thePCGG before it could vote said shares in the stockholders' meeting tobe held on September 12,2017. However, the PCGG had not soughtapproval from this Court.

8. The stockholders' meeting to be held on September 12, 2017 goesagainst the directive of the Supreme Court in G.R. No. 184636.

The Court resolves to deny Vi~or Africa's M~ /'

RESOLUTIONRepublic. vs. Africa, et al.Civil Case No. 0009

As this Court held in the Resolution dated July 6, 2017,2 whichwas cited by Victor Africa in his Urgent Motion, there is nothingprohibiting ETPI from holding a stockholders' meeting for the purposeof electing its board of directors. As long as the meeting complies withthe requirements of Sec. 50 of the Corporation Code and ETPl's By-Laws, the stockholders' meeting will be valid. Thus, at this point, thereis no ground to order ETPI to cease and desist from holding itsstockholders' meeting.

The voting of the sequestered shares by the PCGG in thestockholders' meeting to be held on September 12, 2017 does not goagainst the Supreme Court's directive in G.R. No. 184636, which ishereunder quoted for convenience:

The Court DIRECTS the Sandiganbayan to immediately setan irrevocable deadline for the PCGG to complete the presentationof its evidence in the forfeiture case involving sequestered ETPIshares of stock and, thereafter, to provisionally determine whetherthere is sufficient evidence to allow the sequestration to continue forall or some of the shares, without prejudice to the taking of furtherproceedings to conclude the action. The Sandiganbayan shall thenorder the holding of a stockholders meeting at ETPI to elect a newBoard of Directors, where the sequestered shares may be votedbased on that court's provisional findings.

Said directive refers to the Sandiganbayan ordering the holdingof a stockholders' meeting after making a determination that thesequestration should continue. If the Court determines that thesequestration should continue, it would then order a new stockholders'meeting, and apply the two-tiered test to determine if the PCGG canvote the sequestered shares in such meeting.

The Supreme Court's directive does not refer to stockholders'meetings to be held prior to this Court's determination of whether ornot the sequestration should continue.

WHEREFORE, Victor Africa's Motion is hereby DENIED.

SOORDERE~ ~

h

RESOLUTIONRepublic. vs. Africa, et al.Civil Case No. 0009

AMPARO q"AJE-Presiding JusticeChairperson