CONTRACT OF LEASE

KNOW ALL MENT BY THESE PRESENTS

This Contract of Lease is made and entered into, by the following:

PEDRO SANTOS, of legal age, Filipino, and a resident of

Davao City, Philippines hereinafter collectively referred to as the
LESSOR”;

-and-

JUAN DELA CRUZ, of legal age, Filipino, and a resident of

Davao City, Philippines, hereinafter referred as the “LESSEE”;

WITNESSETH:

WHEREAS, the LESSOR is the owner of the VACANT LOT, described as

Lot ____, Block ___, Psd_______________ situated at ___________________, Davao
City, Philippines, with a land area of Three Hundred Forty (340) square
meters, more or less, and covered by Transfer Certificate of Title No.
___________________________,.

WHEREAS, the LESSOR is willing to lease the Three Hundred Forty

(340) square meter-usable portion, hereinafter referred to as “LEASED
PREMISES”, to the LESSEE, subject to the terms and conditions hereinafter
stipulated, to which the latter accepted.

1) OBJECT OF THE LEASE:

The object of this Contract is the VACANT LOT, referred to as LEASED

PREMISES above.

2) TERM OF LEASE

This Contract shall be for a term of Five (5) YEARS, commencing from
August ____, 2021 to August 19, 2026.

3) MONTHLY RENTAL:

The LESSEE shall pay the LESSOR the following monthly rentals,
inclusive of Value Added Tax (VAT), net of Withholding Tax, subject to FIVE
PERCENT (5%) annual increase in rent commencing on the third year of the
lease, and every year thereafter:

First Year : PHP14,000.00

Second Year : PHP14,000.00
Third Year : PHP14,700.00
Fourth Year : PHP14,700.00
Fifth Year : PHP15,435.00

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 The LESSOR is hereby giving the LESSEE non-extendible One (1) Month
Grace Period, or from ______________ to _________, free of rents for the purpose
of giving sufficient time for the LESSEE to construct or introduce
improvements on the LEASED PREMISES. – WITH GRACE PERIOD ALSO?

A written notice of intention to renew the lease shall be served to the

LESSOR not later than Thirty (30) days prior to the expiry date of the period
herein agreed upon.

The LESSEE shall be obliged to remit the Withholding Tax with the BIR
and must issue a CERTIFICATE OF CREDITABLE TAX WITHHELD AT
SOURCE to the LESSOR. The LESSOR shall have the right to demand for
LESSOR’s compliance on this matter. Continuous unjustifiable and/or
unreasonable refusal to comply shall be deemed as gross violation of this
contract.

All rental payments shall be made under the name of AL JAMES

CAMELLO DUBOUZET. This payee cannot be changed without his consent. In
case of the latter death or incapacity, the rentals shall be made in favor of
his/her heirs.

4) ADVANCE RENTAL

The LESSEE shall deposit to the LESSOR upon signing of this contract
and prior to move-in an amount equivalent to one (1)-month rent or the sum
of FOURTEEN THOUSAND PESOS (P14,000.00), Philippine Currency. This
Advance Rental shall be applied as rents for the last two months of the term.

5) SECURITY DEPOSIT

The LESSEE shall deposit to the LESSOR upon signing of this contract
and prior to move-in an amount equivalent to two (2)-month rent or the sum of
TWENTY-EIGHT THOUSAND PESOS (P25,000.00). This Security Deposit
shall answer partially for damages and any other obligations, for utilities such
as Water, Electricity, Cable, Telephone, Internet, or resulting from violation(s)
of any of the provisions of this contract. In case of pre-termination, the
SECURITY DEPOSIT shall be forfeited in favor of the LESSOR, without
prejudice to the right of the LESSEE to claim for damages if the circumstances
warrant.

6) USE OF THE PREMISES:

The LEASED PREMISES shall be exclusively for the operation of a Junk

Shop business. The LESSEE is allowed at his/her own expense to install
machines, equipment, fixtures, furniture, and utilities in order to effectuate the
said business.

7) PROHIBITION FROM SUB-LEASING:

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 The LESSEE shall not directly or indirectly sub-lease the LEASED
PREMISES or any portion thereof to any person; neither shall he/she assign
his right over it in favor of any third person. Any such contract made in
violation of this clause shall be null and void, and be deemed to be gross
violation of this Contract. It is expressly understood and agreed by the parties
that the personal character of the leased premises as above the restricted and
constituted are the special consideration for granting of this lease by the
LESSOR, consequently, any violation directly and unequivocally terminates
this contract of lease from the time such violation occur.

8) WARRANTY AGAINST EVICTION:

The LESSOR warrants that the LESSEE shall enjoy legal and peaceful
possession and use of the LEASED PREMISES at all times during the Lease
period.

9) STRUCTURES, BUILDINGS, IMPROVEMENTS, ETC.:

The LESSEE shall construct, build, install or introduce structures,

buildings, machineries, or improvements, necessary for the business operation
of the LESSEE. The construction, building, installation or introduction of all
other types of structures, buildings, machineries, or improvements not related
to or not incidental to the business of the LESSEE shall be prohibited without
the written approval of the LESSOR.

Upon the termination of this lease, all permanent structures, buildings,

machineries, and improvements, constructed, built, installed and introduced
by the LESSEE, shall, without additional expense, belong to the LESSOR,
unless the LESSOR elects to compel the LESSEE to remove them forthwith, in
which case the LESSEE shall undertake such removal at his own expenses,
restoring the premises in the same condition in which the received from the
LESSOR.

10) CARE OF THE LEASED PREMISES:

The LESSEE shall, at his expenses, maintain the LEASED PREMISES in

a clean and sanitary condition, free from noxious odors, disturbing noises, or
other nuisances, other than those odors and noises produced in the regular
course of the business operation of the LESSEE. The LESSEE shall maintain
proper sanitary or hygienic standard set for by the proper government
authorities. The LESSEE shall always observe cleanliness and shall maintain
proper upkeep of the LEASED PREMISES. The LESSEE shall likewise comply
with any sanitation and safety regulations by the government.

The LESSEE shall, at his/her expense, be responsible for all repairs on

the structures, buildings, machineries or improvements in the LEASED
PREMISES or any parts thereof. LESSOR is not liable or obliged for any repairs
to keep the property suitable for use to which it has been devoted.

The LESSEE shall also be responsible for the safety and security within
the LEASED PREMISES.

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11) PROPER COMPLIANCE WITH THE LAW:

The LESSEE shall comply with any and all laws, ordinances, regulations
or orders of the national or local government regarding the use, occupation,
and sanitation of the LEASED PREMISES. The LESSEE must secure all
pertinent licenses, permits, certificates and other documents, necessary for the
construction and operation of the business of the LESSEE.

Expenses and penalties arising from the failure to comply with such
laws, ordinances, regulations or order or from failure to secure the pertinent
licenses, permits, and other documents, shall be for the account of the
LESSEE.

12) UTILITIES:

The LESSEE shall pay or defray at his exclusive expenses the

consumption of water, electric, light, cable, telephone or other utility services
in the leased premises. All expenses for the installation, connection and/or the
repairs in the utility service system therein are for the exclusive account of the
LESSEE. All fees related to its usage within the duration of this contract shall
be for the account of the LESSEE.

13) INJURY OR DAMAGE TO THIRD PERSON:

The LESSEE hereby assumes full responsibility for any injury or

damages which may be caused to the person or property of the third persons
and further binds himself to hold the LESSOR free and harmless from such
any claim, injury or damage is due to the negligence or fault of the LESSEE.

Furthermore, the LESSEE shall bear all responsibility or liability from

any or all complaints arising be reason of the operation of its business, or as
consequence thereof. The LESSOR shall be free from such responsibility or
liability.

14) PRE-TERMINATION:

In case the LESSEE pre-terminates this contract, the whole SECURITY

DEPOSIT shall be forfeited in favor of the LESSOR, without prejudice to the
right of the LESSOR to claim for addition damages as the case may be.

15) AUTOMATIC TERMINATION OF THE LEASE:

In case the stipulated rent, at any time, shall be in arrears or unpaid in

the amount equivalent to two (2) months rent; or in case the LESSEE shall at
any time fail or neglect to perform or comply with any of the covenants,
conditions, agreements or restrictions stipulated in this contract; or in case the
LESSEE abandoned the LEASED PREMISES for a period of at least Two (2)

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months; or in case the LESSEE shall become bankrupt or insolvent or shall
become legally questionable or is a fugitive, this lease contract shall become
automatically terminated and cancelled and the premises shall be vacated
peacefully by the LESSEE for the LESSOR to hold and enjoy henceforth as if
these presents have not been made and it shall be lawful for the LESSOR or
any person or persons duly authorized in his behalf, without any formal notice
or demand, to enter the LEASED PREMISES and exercise to any of all rights
from the contract of lease.

16) RIGHT TO SELL, CEDE, TRANSFER OR ASSIGN:

The LESSEE hereby expressly recognizes the absolute right of the

LESSOR to sell, cede transfer or assign the LEASED PREMISES. However, in
the event of sale, the LESSOR hereby undertakes to cause the purchaser to
respect the terms and conditions of this Contract.

17) REAL PROPERTY TAXES, FEE, ASSESMENTS:

The LESSOR shall shoulder the payments of real property tax for the
LEASED PREMISES. However, the LESSEE shall also shoulder the payments
of real property taxes for the structures, buildings, machineries and other
improvements in the LEASED PREMISES.

18) INSPECTION OF THE PREMISES:

The LESSOR or his authorized representative shall have the right to

inspect the LEASED PREMISES at any reasonable hour of the day provided
that the LESSOR has notified the LESSEE at least one (1) prior to the date
intended for inspection.

19) DESTRUCTION THROUGH FORTUITOUS EVENT:

In the event that the LEASED PREMISES is partially or wholly damaged

by fire, earthquake, severe flood or any other fortuitous event, or cause not
attributable to the fault or gross negligence of the either PARTY, its agents or
personnel, the LESSEE shall undertake for the repair of the damages thereof.

20) SURRENDER OF THE PREMISES:

The LESSEE shall, at expiration or termination of this Contract,

promptly deliver the LEASED PREMISES to the LESSOR in as good, reasonable
wear and tear excepted, devoid of all occupants, furniture, articles and effects.

All permanent structures, buildings, machineries, and improvements,

constructed, built, installed and introduced by the LESSEE, shall, without
additional expense, belong to the LESSOR, unless the LESSOR elects to compel
the LESSEE to remove them forthwith, in which case the LESSEE shall
undertake such removal at his own expenses, restoring the premises in the
same condition in which the received from the LESSOR. The LESSEE may,
however, remove movable furniture, fixtures, or other materials that can be

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removed without causing damage or deterioration to the LEASED PREMISES or
to its market value.

21) VENUE OF ACTION:

Any action arising from this contract, shall be brought exclusively to the
proper court of the Davao City only, to the exclusion of all other courts.

IN WITNESS WHEROF, the parties hereunto set their hands this ____
day of ___________________ 2021 at Davao City, Philippines.

PEDRO SANTOS JUAN DELA CRUZ

Lessor Lessee

SIGNED IN THE PRESENCE OF

_____________________________ _____________________________

Republic of the Philippines )

City of Davao ) s.s.
x------------------------------------/

ACKNOWLEDGEMENT

BEFORE ME, a Notary Public for and in the City of Davao, personally
appeared the following persons with their respective competent evidence of
identity, known to me and to me known to be the same persons who executed
the forgoing instrument which they acknowledged to me to be their free
voluntary act and deed, consisting of six (6) pages, including this page in
which these Acknowledgement is written, duly signed by them and their
instrumental witnesses on each and every page hereof:

PARTY COMPETENT EVIDENCE OF IDENTITY

PEDRO SANTOS
JUAN DELA CRUZ

WITTNESS MY HAND SEAL this ____ day of ___________________ 2021 at

Davao City, Philippines.

Doc. No.___;
Page No.___;
Book No.___;
Series of 2021.

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