CONTRACT OF LEASE

KNOW ALL MEN BY THESE PRESENTS:

That this Contract of Lease, made and entered into this _____ day of _____________ at the
Municipality of _______________________, Philippines, by and between:

______________________________, a corporation existing under and by virtue of the

laws of the Philippines with offices address at Mac Arthur Highway, Hermoso Compd.,
Rosales St., Tugatog Meycauayan, Bulacan, herein represented by ____________,
hereinafter referred to as the “LESSOR”
-and-

_________________________, with office address at

________________________________, hereinafter represented by its
________________, ______________________, hereinafter referred to as the
“LESSEE”.

- WITNESSETH -

The LESSOR hereby leases unto the LESSEE, and the LESSEE, hereby agrees to lease from the
LESSOR Unit _____ of the building owned by the LESSOR, located at McArthur Highway, Banga,
Meycauayan City subject to the following terms and condition:

NOW, THEREFORE, the parties hereto have agreed, and they hereby agree, as follows:

1. LEASE PERIOD – This Lease shall be for a period of five (5) years and shall commence on
August 2021 and will expire on August 2026. This contract is renewable at the option of
both parties. After the expiration of the said period, and in the absence of an express renewal
thereof, it is understood that the lease thereon is on a month to month basis, subject to the
same terms and conditions herein stated. However, there will be no renewal of contract of
lease in case the LESSEE has outstanding rental balance.

In case of pre-termination, LESSEE shall be required to issue a written notice to LESSOR

within sixty (60) days from effectivity of termination. LESSEE shall continue paying
LESSOR its rental fees for the last sixty (60) days prior to pre-termination, regardless of
occupation.

2. DELIVERY AND OCCUPANCY OF THE PREMISES – The LESSOR shall deliver the
leased premises on an as-is-where-is basis, and in good and tenantable condition. It shall be
used by the LESSEE solely for commercial purposes. Upon its termination, it shall be
delivered back to the LESSOR together with all permanent improvements introduced and
made thereon by the LESSEE, ordinary wear and tear excluded.

3. RENTAL – During the effectivity of this lease, the LESSEE shall pay to the LESSOR at the
latter’s office or to its duly authorized agent, on the first (1st) of every month, without
necessity of demand, the amount of ______________________ (P _______________), net
of applicable taxes. The LESSEE will shoulder the withholding tax and other taxes as the
case may be. Rental fees shall likewise be subject to an escalation clause in the following
manner:

Year Escalation Withholding Tax 12% VAT Total Rent

2022 10%
2023 15%
2024 10%
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 2025 15%
2026 10%

In case of renewal of contract, an annual escalation increase of 10% shall be applied on the
monthly rental of the LESSEE.

All utility bills such as electricity, telephone, and water including all taxes and other fees
relative to the business of the herein LESSEE is for its sole account. In case LESSEE, for any
reason, fails to pay its utility to bills, LESSOR shall be permitted to turn off or cut the power
source the said utility, until fully paid.

In case of failure to pay monthly rentals or bounced checks, the LESSEE shall be charged by
the LESSOR, a penalty corresponding to an interest of five (5%) percent per month, and
which interest is to be compounded monthly. This penalty is without prejudice, however, to
the right of the LESSOR to terminate the lease contract should it decides to do so.

The LESSOR is amenable to accept voluntary lodging of the LESSEE’S personal belongings
that will secure the unpaid rental balances of the latter, and the same will be surrendered back
to the LESSEE upon full payment of the rental balance within a stipulated time.

4. SECURITY DEPOSIT – For the faithful compliance with all the terms and conditions of this
lease contract, the LESSEE shall, upon execution of this contract, deposit with the LESSOR
the amount of _____________________ PESOS (PhP_________________), Philippine
Currency, corresponding to two (2) months rental, as Security Deposit.

The LESSOR shall apply such deposit toward the payment of any claim that the LESSOR
may have against the LESSEE upon the termination of this Contract. Any balance remaining
on such deposit shall be returned to the LESSEE upon the termination of this Contract, or
the LESSEE can apply the same as rental payment corresponding to the last two months of
this lease, and any amount remaining after applying the said balance of deposit shall be
returned by LESSOR to LESSEE as herein stated. Security deposit will be refunded three (3)
months after lease and utility bills of LESSEE has been cleared. However, there will be NO
REFUND of security deposit if the contract is pre-terminated in less than one (1) year.

5. RENTAL ADVANCE - The LESSEE shall pay to the LESSOR an advance rent of
_____________________ PESOS (PhP_________________) Philippine Currency,
corresponding to two (2) months rent and will issue Ten (10) Postdated Checks
equivalent to the monthly rental, corresponding to the rent for the year.

At the end of each year or until December 31 of every year, the LESSEE shall issue Twelve
(12) Postdated Checks dated first (1st) of every month covering the rental payments of the
succeeding year.

6. USED OF LEASED PREMISES –The leased premises shall be strictly for purposes as
commercial space. It shall not be used or permitted to be used for any other purpose other
than that mentioned herein without the prior written consent of the LESSOR.

7. CARE AND MAINTENANCE – The LESSEE shall, at its own expense, maintain the leased
premises in clean and sanitary condition, free from obnoxious odor, disturbing noises and
other nuisance.

The LESSEE shall not drive nails, screw hooks or other abutments on the walls, frames or
other portions of the building that will deface the leased premises. Any damage to the
building or any part thereof caused or done by the same shall be ordered repaired by the
LESSOR for the account of the former.
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 Likewise, the LESSOR shall keep and maintain the interior of the leased premises including
the flooring and the interior plaster or other surfacing materials, the walls, and ceilings, the
doors, properly preserved, painted and lime washed as maybe appropriate when from time to
time required.

The LESSEE particularly agrees to replace all clogged, broken and damaged carpentry
works, windows, plumbing, electrical fixtures and all drainage, and to replace the same in
and about the premises when the same be broken or damaged by the misuse and/or
negligence of the LESSEE. In case, the LESSEE fails to do so, the LESSOR may do the
work and to subsequently charge the expense to the LESSEE’S account. In such case, all
advances made by the LESSOR shall be added to the rental dues of the LESSEE in the
succeeding month, which shall be immediately due and outstanding. Failure to pay the cost
of repairs shall be subject to the same penalty provision as Section 3 of this Agreement.

For avoidance of doubt, all costs of repairs and maintenance, not due to the fault of LESSEE
which exceed Ten Thousand Pesos (PhP10,000) shall be considered major repairs. Major
repairs shall be shouldered by the LESSOR.

At its own cost and expense, the LESSEE shall provide himself with receptacles with which
to hold and contain waste matters, garbage and refuse, and which the City Ordinances may
require, and shall deposit them at reasonable places and/or as may be designated by the same
ordinances.

Sidewalks, entries, passages and stairways of the building shall not be obstructed or used by
the LESSEE for any purpose other than for the ingress to or egress from the building.
Neither shall they be used for the carriage or storage of bulky materials, articles and/or
equipment that may cause inconvenience or damage to the building or to the other tenant, or
to the LESSOR himself.

The LESSEE shall comply with all reasonable rules and safety regulations which maybe
promulgated from time to time by the LESSOR, or by its building Administrator, with all
laws and ordinances of the City or National Government incidental to the use, occupancy
and sanitation of the leased premises.

8. ALTERATIONS AND ADDITIONS – The LESSEE shall not make any alterations,
installations, additions, and/or improvements made pursuant to the foregoing, except the
movable furniture and fixtures put in at the expense of the LESSEE, and immediately upon
completion thereof, become the LESSOR’s property, and shall remain and be surrendered
with the leased premises upon the expiration of the lease contract without any compensation
to the LESSEE.

9. RESTRICTIONS AND PROHIBITIONS – The LESSEE shall nor bring in contraband or

prohibited drugs or illegal goods, nor shall it store any highly flammable or explosive
substance, or any article, which the LESSOR may reasonably prohibit to be brought in. It is
likewise prohibited to install or operate any equipment, machinery, or apparatus which
would cause tremors, or constitute nuisance to the occupants of the building. Potential fire
hazards, or those which would increase the insurance rate of the building area also
prohibited from being brought in. Any increase in the insurance rate cause by the manner
with which the LESSE used the leased premises, shall be chargeable to LESSEE’s account.

a. In cases of termination, LESSEE will voluntarily leave the leased premises; the
policy ‘NO PAY – NO ENTRY’ will follow. The LESSEE will be ejected,
banned and can no longer enter the premises. The LESSOR can padlock the

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 premises if desired so or hire the services of a Security Guard, at the expense of
the LESSEE, to prevent entry of the LESSEE.
b. LESSEE agrees that any personal effects that maybe found within the lease
premises shall be inventoried and held as guarantee for any arrears of the
LESSEE to the LESSOR. After a month of safekeeping if no payment of LESSEE
is done, the personal effects of the LESSEE shall be deemed forfeited in favor of
the LESSOR.
c. The LESSOR will not be liable to any civil or criminal action when implementing
a provision of this contract.

10. LIABILITY AND INDEMNIFICATION – No liability shall attach to the LESSOR for any
damage to the property, of for injury to or death of any of the LESSEE’s employees
occasioned by the leased premises being out of repair, or occurring by reason of, or
condition, upon or about the leased premises, and which it could not have reasonably
prevented, or through any act or neglect of any co-tenant, or other occupants of the said
building or any premises adjacent thereto, or any owners or occupants of adjoining or
contiguous property.

Neither shall it be liable for any damage caused by, or arising from the failure of the water
supply and electric current, or the defects in the plumbing, gas, water or electrical
installations, the bursting, leaking or running of any wash stand, water closet, cistern, tank or
water pipe, and which under ordinary circumstances, it could not have foreseen and
prevented.

11. DELIVERY OF THE LEASED PREMISES AT THE EXPIRATION OF THE CONTRACT

– At the expiration of this contract and with a notice to vacate served by the LESSOR to the
LESSEE, or upon prior cancellation thereof as maybe herein provided, the LESSEE shall
promptly deliver the leased premises to the LESSOR in good and tenantable condition,
devoid of all occupants, furniture’s, articles and effects of any kind, except those expressly
allowed, or those that were made in accordance with the leased contract. Non-compliance
with the provision shall give the LESSOR the option to refuse to accept the delivery of the
premises, and to compel the LESSEE to pay the rent therefore at the same rate as herein
provided plus seventy percent (70%) of the same as penalty until the LESSEE shall have
complied with the terms hereof.

12. AUTOMATIC CANCELLATION/TERMINATION – If the rental herein stipulated or any

part thereof shall be in arrears or shall remain unpaid for a period of two (2) months, or
comply with any of the condition, agreements, or restrictions stipulated, or if the LESSEE
shall have been declared insolvent, this Contract of Lease may be cancelled and terminated
at the option of the LESSOR upon thirty (30) days prior notice served at the Lessee or
posted on the main door of the leased premises. Thereafter, the LESSE shall vacate the
leased premises peacefully, and shall grant to the LESSOR the legal right to enter, and to
take possession of the same.

In addition, the LESSOR is further authorized to prevent the LESSEE to entry the leased
premises and from conducting business thereon. All expenses incurred in the process shall
be chargeable to the account of the LESSEE.

13. ASSIGNMENT AND SUBLETTING – The LESSEE cannot sublease any part of the leased
premises without the prior written consent of the LESSOR.

14. INSPECTION AND MAINTENANCE – The LESSOR or any of its duly authorized agents
shall have the right to enter the leased premises at any reasonable hour to examine the same,
or for any purpose which it may be deemed necessary relative to its maintenance. During the
last three months of the lease contract, and in case where no renewal has yet been agreed
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 upon, the LESSOR is further granted the right to exhibit the leased premises to prospective
tenants.

After due notice from the LESSOR, the LESSEE, shall allow and shall give access to the
LESSOR for the purpose of making necessary and urgent repairs. In cases of remodeling,
repainting, improvements, repartition or decoration, the same rule shall apply provided that
they be done with the least possible inconvenience and damage to the LESSEE’S interest.

15. EXPROPRIATION AND FORCE MAJEURE – Should expropriation proceedings be

initiated over the property by any instrumentality of the Government, or by any entry to
exercise such powers, or in case of fire, or other acts of God hereinafter called calamities or
force majeure), then other party may elect to rescind this contract. In cases, however, the
leased premises are rendered totally useless for the purpose for which they are intended, then
such contract shall be automatically rescinded and cancelled.

In such cases, the LESSEE hereby relieve and release the LESSOR from any and all liability
in connection with or arising out of the same without prejudice to whatever recourse the
LESSEE may have against the expropriating authority. Rental shall be paid only up to the
partial or total destruction, and the lease contract is terminated as if the period thereof has
expired.

LESSEE understands and agrees that the COVID-19 pandemic or government regulations
incidental thereto, are not considered fortuitous events that would delay, bar or excuse
LESSEE’s payment of monthly rentals, escalation agreements, the costs of repairs and
maintenance or all other expenses stated in this Agreement.

16. BREACH OR DEFAULTS – All covenants and agreements herein contained are deemed
essential conditions of the lease contract. In case of material default or breach of any part
hereof. then par. 16 applies.

Should the LESSOR be compelled to seek judicial relief, the LESSEE shall pay an amount
equivalent to seventy (70%) of the amount claim in the complaint as penalty plus attorney’s
fees, aside from the cost of the suit and of the other expenses which the law entitles the
LESSOR to recover from the LESSEE.

17. TAKE OVER OF THE PREMISES BY THE LESSOR - In cases where this contract is
terminated or cancelled, either judicially or extra-judicially, due to the fault of the LESSEE,
LESSEE’S cash deposit shall be forfeited in favor of the LESSOR by way of penalty, and
the LESSOR is granted the right to enter the leased premises as authorized agent of the
LESSEE.

If after cancellation or termination of the Contract of Lease and there remains an outstanding
obligation by the LESSEE, then the LESSOR is given the authority to sell at a public or
private sale all goods, merchandise, furniture, fixtures and equipment found on the leased
premises, and to apply the proceeds thereof to any outstanding obligation of the LESSEE,
and the excess, if any, shall be turned over to the LEESEE.

18. TERMINATION OF THE LEASE - The occurrence of the following shall grant the
LESSOR the option to terminate the contract of lease:

a) Filing of petition for bankruptcy, voluntary or involuntary insolvency by or against

the LESSEE;

b) Deliberate and malicious violation or any of the provision of the Contract of Lease as
well as the abandonment and/or non-operation of the business of the LESSEE;
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 c) Assignment by the LESSEE of its right under this lease for the benefit of creditors
and/or third parties without the written consent of the LESSOR or the issuance of a bad
check in payment of any of the rental as they fall due;

d) Levy on attachment or execution against all or part of the property of the LESSEE
found in the leased premises;

e) Failure to pay utilities, taxes, permits, licenses requires by local ordinance or law or
the monthly rental for at least two (2) months;

f) Failure of the LESSEE to observe the prescribed rules and regulations relative to the
care and maintenance of the leased premises;

g) Refusal of the LESSEE to pay adjustment on the rentals in case of devaluation of

Philippine peso or to pay the withholding tax, or to reimburse the LESSOR in case it was
advanced by the latter.

19. NON WAIVER – The failure of the LESSOR to insist the strict performance of any of the
terms, conditions, and covenants hereof shall not be deemed a waiver of any of the rights or
remedy that the LESSOR may have, nor shall the same be construed as a waiver of any
subsequent breach of default of the terms, conditions and covenants.

20. SUCCESSORS AND ASSIGNS – Subject to the provision of par. hereof, this lease shall
bind and shall inure to the benefit of the successors and assignees of the LESSOR, and of the
permitted successors and assignees of the LESSEE:

21. NOTICES- Any notice to the LESSEE shall be served and delivered and posted within the
leased premises or mailed by registered mail to the LESSEE at the leased premises, or at
such other addresses that the LESSEE may elect. Any notice to the LESSOR shall be at the
stated address in the Lease Contract.

22. JUDICIAL DECLARATION- In case any provision or part of this contact shall be declared
unconstitutional, unlawful or illegal, then the whole contract shall become void on the date
of such declaration, and the LESSEE shall peacefully vacate and surrender the leased
premises to the LESSOR as if the contract has terminated.

23. LESSOR’S LIMITED LIABILITY ON DAMAGES- In case where the LESSOR is held
liable on any ground remotely, directly or indirectly relating to this contract, then the
LESSEE agrees that the liability of the LESSOR shall not exceed the equivalent month
rental regardless of the nature and consequence of one (1) damage.

24. TAXES – The LESSOR shall pay all real estate imposed on the leased premises, other than
those assessed on improvements installed by the LESSEE, which shall be for the LESSEE’S
account and be paid by it promptly when due.

25. FAILURE TO REMODEL OR TO RECONSTRUCT ON TIME – All plans and blueprint

on remodeling, renovations, or reconstruction’s shall have to be shown to and approved by
the LESSOR. The LESSEE shall then finish any renovation, remodeling or reconstruction’s
preliminary to its occupancy of the leased premises within thirty (30) days from the date of
signing of this contract. Its failure to do so shall grant the LESSOR the option to rescind this
contract without having to reimburse any payments made except that of the deposit.

26. LESSOR’S NECESSARY WORKS ON THE PREMISES – In the event that the building
be in need of urgent and necessary repairs without which the building in which the leased
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 premises are situated, or should there be a need to partition the property among the co-heirs
or the co-owners and both be done without disturbing the peaceful occupation of the
LESSEE over the lease premises, then the LESSEE is granted the option to either vacate the
property as if the period thereof has expired, or to continue possession thereof, in which
latter case the LESSOR shall have no liability for any cost or damage that the LESSEE may
suffer in the process.

27. FAILURE OF LEASE TO OPERATE HIS BUSINESS – The LESSEE shall operate and
run its intended business on the leased premises. His failure to so operate for a continuous
period of three (3) months shall grant the LESSOR the right to terminate or to rescind this
Contract of Lease.

28. VENUE OF ACTIONS- In case of any litigation involving the leased premise or of the
Lease Contract over the same, then the courts of Meycauayan shall exclusively be the proper
venue for the same.

IN WITNESS WHEREOF, the parties hereto have set their hands and affixed their signature this
______________ day of ___________, in _______________, Philippines.

______________________________. ___________________________
(LESSOR) (LESSEE)

Represented By:
______________________ _________________________
_____________________ ____________________
(LESSOR) (LESSEE)

Signed in the presence of:

______________________ ______________________

ACKNOWLEDGMENT

BEFORE ME, a Notary Public, in and for the _____________________ personally appeared:

To me and known to me to be the same persons who signed the foregoing Contract of Lease,
and acknowledged to me that they executed the said document as their own free and voluntary act
and deed and the free and voluntary act and deed of the corporation which they represent herein.

Doc. No. ______

Page No. ______
Book No. ______
Series of _______

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