CONTRACT OF LEASE

(LAND)

KNOW ALL MEN BY THESE PRESENTS:

This Contract made and entered into by and between:

ROSAURO L. BACUS, JR., Filipino, of legal age, married, and a

resident of Eastland Subdivision, Yati, Liloan, Cebu City, hereinafter
referred to as the “LESSOR”;

-and-

RIA MAE ALBURO, Filipino, of legal age, married, and a resident

of 245 Pusok, Lapu-Lapu City, Cebu hereinafter referred to as the
“LESSEE”;

WITNESSETH That:

WHEREAS, the LESSOR is the absolute and legal owner of a parcel of land,
particularly designated as Lot 26-B-19 of the subdivision plan, Psd-07-015068,
being a portion of Lot 26-B, Psd-07-05-010548, L.R.C. Rec No. 9462 with an area
of One Hundred Fifty Square Meters (150 sqm), more or less, located in 26 Palmera
Homes, Barangay Basak, Mandaue City;

WHEREAS, the LESSEE is looking for a leasable space to be used as a

bunkhouse and parking/delivery area for its business R2 Trucking Services. A copy of
the Business Permit is attached as Annex “A” and is made an integral part of this
Contract;

NOW, THEREFORE, for and in consideration of the foregoing premises,

which are essential conditions and integral parts of this Contract, and the mutual
covenants and conditions hereinafter set forth, the parties hereby agree as follows:

I. LEASED PREMISES

1. The LESSOR hereby leases unto the LESSEE, the above-described parcel of
land, hereinafter referred to as the Leased Premises.

2. The Leased Premises shall be used exclusively by the LESSEE as a bunk

house and parking space for trucks and/or other vehicles incidental to its business
of providing trucking services. The said area shall be used for the LESSEE’S own
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exclusive purpose and other related activities. Conformably thereto, the Leased
Premises may not be used for any other purpose without the written consent of the
LESSOR. The construction sketch of the bunkhouse is hereto attached as Annex
“B” and is made an integral part of this Contract.

II. TERM OF LEASE

The term of the lease shall be for a period of ONE (1) YEAR FROM
SEPTEMBER 1, 2024 TO SEPTEMBER 1, 2025, unless sooner terminated as
hereinafter provided. The lease may be renewed at the option of the LESSEE, upon
such terms and conditions as may be mutually agreed upon by the parties. Such
option shall be exercised in writing by the LESSEE not later than thirty (30) days
prior to the expiration/termination of this Contract. The LESSOR shall have the
option to pre-terminate this Contract of Lease at any time on grounds herein
provided upon a thirty (30) day prior written notice to the LESSEE.

III. RENTAL

1. For the use and occupancy of the Leased Premises, the LESSEE shall pay
unto the LESSOR a rental of THIRTEEN THOUSAND PESOS (P13,000.00) per
month and shall be paid by the LESSEE unto the LESSOR not later than every first
day of the month without need of demand. Upon renewal, the lease rate shall be
escalated at the rate of Five Hundred Pesos (P500.00) every month.

2. Upon execution of this Contract, the LESSEE shall pay unto the LESSOR an
ADVANCE LAND RENTAL equivalent to one (1) month rental in the amount o f
THIRTEEN THOUSAND PESOS (P13,000.00) and a SECURITY DEPOSIT equivalent
to two (2) months rental in the amount of TWENTY-SIX THOUSAND PESOS
(P26,000.00).

3. Should the LESSEE fail to pay the amount due or any part thereof within the
stipulated period, a penalty of Five Hundred Pesos (P500.00) per month of the
delay shall be imposed until the amount due is paid. A fraction of a month shall be
considered as a full month for purposes of penalty.

IV. LESSOR COVENANTS

1. The LESSOR warrants that the LESSEE shall have peaceful and quiet
possession and enjoyment of the Leased Premises throughout the term of this
Contract.

2. In the event that the LESSEE is deprived of or interrupted in its peaceful and
quiet possession and enjoyment of the Leased Premises, the LESSEE without
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prejudice to the other remedies available under the law, shall have the right to
claim reimbursement from the LESSOR of any unused amount paid by the LESSEE
under this Contract as well as other expenses incremental to the Lease
Agreement.

V. LESSEE COVENANTS

1. The LESSEE, during its occupancy of the Leased Premises, shall hold the
LESSOR free and harmless from any damage, liability, or responsibility to any
person or property arising out of or as a consequence of the LESSEE’S use or
enjoyment of the Leased Premises.

2. To the extent applicable, the LESSEE shall observe strictly all prevailing
laws, rules, and regulations imposed by the Republic of the Philippines;

3. The LESSEE shall not use or permit the use of the Leased Premises, or
any part thereof for any immoral or other purposes prohibited by law, morals,
public order, or public policy

VI. IMPROVEMENTS

1. The LESSEE may install at its own account facilities and equipment of every
kind, description, and character, and undertake such improvements or repairs of
the Leased Premises as will be necessary for the operation of its business
activities in the said Leased Premises. PROVIDED, however, that the strength
and general structure of the bunkhouse to be constructed in the Leased Premises
shall be subject to the applicable provisions of Presidential Decree No. 1096,
otherwise known as the National Building Code of the Philippines as amended by
Presidential Decree No. 171-A and such other applicable rules and regulations,
circulars, directives and laws governing the issuance of the building and
occupancy permits, mechanical or electrical inspections and visitation of the
Leased Premises;

2. All immovable and permanent improvements introduced by the LESSEE in

the Leased Premises shall, after the expiration of the lease or extension or the pre-
termination of this Contract, vest in absolute ownership unto the LESSOR without
reimbursement of their value to the LESSEE. For this purpose, immovable or
permanent improvements shall refer to everything attached to an immovable
property in a fixed manner in such a way that it cannot be removed or separated
therefrom without breaking the material or deterioration of the object to which it is
attached. It shall likewise refer to those immovable properties enumerated in
Article 415 of the New Civil Code of the Philippines.

Except as herein provided, only machinery, equipment, inventories, and semi-

permanent improvements which are installed therein by the LESSEE may be
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removed at its own exclusive expense. Semi- permanent improvements

include those that can be removed from the Leased Premises without causing any
damage to the latter. The LESSEE is hereby granted a reasonable time within which
to remove the improvements which shall in no case be more than sixty (60) days
from and after the termination or expiration of this Contract or extension thereof;
PROVIDED that the LESSOR shall have a first lien on such machinery or facilities or
equipment installed by the LESSEE; PROVIDED FINALLY, that if the Leased
Premises be defaced or damaged on the occasion of such removal, the same shall
be restored or repaired at the sole and exclusive expense of the LESSEE.

3. In the event the LESSEE fails to remove within the 60-day period the
foregoing non-permanent improvements, the LESSOR, at its option, may remove
the same and the expenses attendant thereto shall be chargeable against the
LESSEE. However, the LESSEE shall continue to be liable to pay the lease rental
until it has completely vacated the premises.

VII. SIGNS, ADVERTISEMENTS, ETC.

No streamers or any similar advertising signs shall be allowed to be hung on

the Leased Premises.

VIII. ACCESS TO LEASED PREMISES

The LESSOR or its duly authorized representative(s) shall have the right to
enter and view the conditions of the Leased Premises at reasonable hours and in a
convenient manner upon prior notice to Lessee for the purpose of enforcing the
terms and conditions of this Contract and the pertinent rules and regulations
promulgated by the LESSOR.

IX. CARE OF LEASED PREMISES

The LESSEE shall at its own expense, maintain the Leased Premises in a
clean and sanitary condition, free from noxious odors, disturbing noises, and other
nuisances. The LESSEE shall likewise keep the Leased Premises and its immediate
surrounding vicinity free from environmentally hazardous waste materials, and for
this purpose, should maintain a safe waste disposal system.

X. UTILITIES

The LESSEE shall pay and defray at its own expense the installation and
consumption costs of electricity, water, telephone, and such other services or
utilities, as may be employed or consumed by the LESSEE upon the Leased
Premises.
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XI. PARKING ALONG THE ROADS

The LESSEE shall not be allowed to park its motor vehicles along the roads
near the Leased Premises or any road within the subdivision where the Leased
Premises is located.

XII. ASSIGNMENT AND SUBLETTING

The LESSEE may not assign, transfer or sublease the Leased Premises.

XIII. SECURITY OF AREA & PREMISES

The LESSEE shall provide and pay for the services of security guards to
secure and protect the Leased Premises against any trespassers or intruders. The
LESSOR shall not be liable for any loss or damage suffered by the LESSEE resulting
from any theft, robbery and other crimes committed within the Leased Premises.

XIV. CUMULATIVE REMEDIES/NON-WAIVER

The receipt by the LESSOR of any rent or payment, with or without the
knowledge of the breach of any covenant hereof, shall not be deemed a waiver of
such breach, and no waiver of any sum or right hereunder shall be valid unless
made in writing and signed by the LESSOR waiving said sum or right. No delay or
omission in the exercise of any right or remedy accruing to the LESSOR hereto upon
any breach of obligation provided in this Contract shall impair such right or remedy,
or be construed as a waiver of any such breach thereafter occurring.

XV. AMENDMENT OF CONTRACT

This Contract may not thereafter be modified or altered except by mutual

agreement reduced in an instrument duly signed by the parties thereto.

XVI. TERMINATION OF LEASE

Among others herein provided, the LESSOR may motu propio terminate this
Contract by a written notice upon the happening of any of the following events:

1. An affirmative act of insolvency by the LESSEE or the filing by the LESSEE

of a petition under any bankruptcy, reorganization, insolvency or moratorium law
for relief from debtor;
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2. The filing of any involuntary petition under any bankruptcy statute

against the LESSEE, or the appointment of any receiver or trustee to take
possession of the properties of the LESSEE;

3. A final judgment by the Courts or the final decision by the LESSOR that
results in the permanent suspension of any permit or license, possession of which
is a prerequisite to the operation of the LESSEE’S business under applicable laws;

4. If the rental herein stipulated, or any part thereof, is not paid by the
LESSEE to the LESSOR within three (3) months from the time the same is due;

5. If the LESSEE shall at any time fail or neglect to perform or comply with
any of the covenants, conditions, agreements or restrictions herein stipulated.

In the event of such termination based on any of the above cases, the
premises shall be immediately vacated peacefully by the LESSEE for the LESSOR
to hold, enjoy and dispose of and the LESSOR or any person or persons duly
authorized on his behalf, may without any formal notice or demand, enter into and
occupy said Leased Premises or any part thereof, even in the absence of a court
order, and further without prejudice on the part of the LESSOR to exercise any or
all rights under this Contract and those provided by law.

PROVIDED, FINALLY that if the cause of termination of the Contract

includes non-payment of the rentals and other monetary obligations by the
LESSEE, the LESSOR ipso facto has the authority to sell the machineries,
equipment and other properties of the LESSEE to answer for the unpaid financial
obligations of the LESSEE. Any excess to such sale, less the cost of sale, shall be
refunded by the LESSOR unto the LESSEE.

Other causes for termination may include acts of God, or voluntary

termination by the LESSEE for cause, provided that in the case of voluntary
termination by the LESSEE a two (2)-month prior notice to that effect shall be given
to the LESSOR.

If the lease will be pre-terminated by the LESSEE, LESSOR shall reimburse

to the LESSEE the unused portion of the advance rental paid subject to any valid
claims that the LESSOR may have against the LESSEE at the time of pre-
termination. It shall be based on the actual months used subject to any valid
claims that the LESSOR may have against the LESSEE at the time of pre-
termination. A fraction of a month shall be considered a full month for purposes of
computation. However, this refund shall not apply to termination by the LESSOR
for cause stated in Section XVI paragraph 5 hereof.
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XVII. BINDING EFFECT OF CONTRACT

This Contract shall be binding upon the successors, assigns, executors, and
administrators of the parties herein.

XVIII. EFFECTIVITY OF THIS CONTRACT

This Contract shall take effect upon its signing by the contracting parties
and shall continue to take effect during the period of the contract unless renewed
or pre-terminated for causes herein provided.

XIX. SURRENDER OF THE LEASED PREMISES

Upon the expiration, extension or pre-termination of the term of this

Contract, unless extended or renewed, the LESSEE shall surrender and yield
quietly and peacefully to the LESSOR the possession of the Leased Premises,
including the immovable improvements thereon pursuant to Section VI hereof, in
the same condition which they have been found at the beginning of the lease,
ordinary wear and tear, reasonable use and other unavoidable losses expected. If
the possession of the Leased Premises is not surrendered at the expiration, or pre-
termination hereof, the LESSEE shall be responsible to the LESSOR for all damages
which the latter may suffer by reason of such delay and will indemnify the LESSOR
against any and all claims made by the succeeding occupant against the LESSOR,
resulting from the delay of the LESSEE in delivering the possession of the Leased
Premises to the LESSOR, so far as the delay is occasioned by the failure of the
LESSEE to surrender the Leased Premises on time.

XX. LESSOR EXEMPT FROM LIABILITY

The LESSEE shall keep, save and hold the LESSOR free from any and all
liabilities, penalties, losses, damages, costs, expenses, causes of action, claims
and/or judgments arising out of or by reason of any injury or liability caused by any
person or persons, from any cause or causes whatsoever relating to the operations
of the LESSEE’S business during the term of this Contract.

XXI. DEFAULT

Any violation or default in the performance of the covenants and obligations

set forth in this Contract by the LESSEE shall constitute a ground for the revocation
of this Contract without the need of judicial or extra-judicial demand/action if no
corrective or remedial measures satisfactory to the LESSOR are instituted within
thirty (30) days from written notice of such violation or default. Provided, that the
LESSOR shall be entitled to all damages that it may have suffered by reason of such
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violation or default.

XXII. COST OF SUIT/VENUE OF ACTION

1. Any problem arising out of this Contract or interpretation of any provision

hereof shall be settled amicably, and where amicable settlement fails,
parties hereto agree that any court action arising out of this Contract shall
be filed in the proper court in Mandaue City.
2. In case of suit or action in court, the party prevailing shall be entitled to
recover attorney’s fees in an amount not less than P 50,000.00 in addition
to costs and expenses of litigation.

XXIII. NOTICE

Notice required hereunder or by law to be served upon either of the parties

shall be in writing and shall be delivered personally or sent by registered mail to the
other at its above-specified address or to such other address designated by such
party in writing. Notice by registered mail shall be deemed completed after five (5)
days from receipt of the registry notice.

IN WITNESS WHEREOF, the parties hereto have signed this ________ day of
_________________ 2024, in Cebu City, Philippines.

ROSAURO L. BACUS, JR. RIA MAE ALBURO

LESSOR LESSEE

SIGNED IN THE PRESENCE OF

________________________________ __________________________
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ACKNOWLEDGMENT

Republic of the Philippines)

Cebu City ) S.S.

BEFORE ME, this _____ day of _______________ 2024, personally appeared:

Name ID No. Issued at/On

Rosauro L. Bacus, Jr.
Ria Mae Alburo

known to me and to me known to be the same persons who executed the foregoing
instrument and acknowledged to me that the same is their free and voluntary act
and deed.

Said instrument refers to a CONTRACT OF LEASE of land, consisting of nine

(9) pages including this page whereon this Acknowledgment is written, and signed
by the parties and their witnesses on each and every page thereof.

WITNESS MY HAND AND SEAL this ________ day of _______ 2024 in Cebu
City.

Doc. No. _______;

Page No. _______;
Book No. _______;
Series of 2024