SSF F#5/Rev.

01/11-27-13

ANNEX E
USUFRUCT AGREEMENT
SHARED SERVICE FACILITIES (SSF) PROJECT

KNOW ALL MEN BY THESE PRESENTS:

President & CEO, AGREA Foundation

This agreement is made and entered into this _____ day of ________________, 2020
CHERRIE D. ATILANO

by and between:

The Department of Trade and Industry-MIMAROPA Regional Office, an agency of

National Government, located at 5F OPPEN Bldg., Sen. Gil Puyat Ave.,Makati City,
represented by its Regional Director JOEL B. VALERA, hereinafter referred to as “DTI-
MIMAROPA”,

- and –

AGREA AGRICULTURAL COMMUNITIES INTERNATIONAL FOUNDATION, INC.,

hereinafter referred to as AGREA Foundation, duly organized and existing under the laws
of the Republic of the Philippines with principal address, AGREA Farm Estate, Brgy. Cawit,
Boac, Marinduque, represented by its President and CEO CHERRIE D. ATILANO, and
hereinafter referred to as the “COOPERATOR”;

WITHNESSETH:

WHEREAS, MSME Development is a key strategy to achieve Government’s goal of

inclusive growth and jobs generation, a major component of the Shared Service Facilities
(SSF) project which aims to improve the competitiveness of MSME’s by providing them with
machinery, equipment, tools, systems, skills, knowledge under a shared system.
OIC-PD, DTI Marinduque
RONIEL M. MACATOL

WHEREAS, the 2013 General Appropriations Act (GAA) has earmarked funds under
the budget of the Department of Trade and Industry (DTI) to implement its “Big Push” for
MSME development;

WHEREAS, the SSF Project will support MSME within the priority industry clusters in
Sta. Cruz and the province of Marinduque;

WHEREAS, to establish standards for the efficient and effective implementation of the
SSF Project purposely to provide implementing units particularly regional/provincial offices
with policy guidelines, definitions of roles and responsibilities, and prescribe standard
operating procedures, and timelines, DTI issued Memorandum Order No.:13-1637, s.2013
and Memorandum Order No.: 15-58, s.2015 respectively;

WHEREAS, under the said SSF Guidelines, the DTI, through its Regional Offices/
JOEL B. VALERA, CESO III

Provincial Offices, shall identify and select a Cooperator that will host and manage the
RD, DTI MIMAROPA

operation of the SSF project using certain criteria enumerated therein, which can either be a
government entity such as, but not limited to LGUs, state universities/colleges or technical or
vocation schools or private entity that will include non-government organizations, peoples’
organizations and cooperatives;

WHEREAS, DIT has passed the Criteria for Selection of Cooperator as stated under
Section VI.3. of the SSF Guidelines as follows:
VI.3. Must be capable of providing counterpart support in terms of:
VI.3.1 Suitable facilities to house the machinery and equipment
VI.3.2 Support Personnel
VI.3.3 Working Capital

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 WHEREAS, an integral component of the SSF, is the execution of a Usufruct
Agreement between the DTI and the Cooperator as provided under Section 5.5.9 of M.O.
No. 15-58 s.2015.
President & CEO, AGREA Foundation

5.5.9 The machinery/equipment shall be used by the Cooperator under a Usufruct

Agreement (Annex I) which shall form an integral part of the MOA, for a period of time
as provided in the MOA. DTI shall provide insurance for two (2) years from the date of
CHERRIE D. ATILANO

execution of the usufruct agreement to cover loss or damage to the

machinery/equipment due to but not limited to fire, theft, flood, earthquake or other
fortuitous event. The Cooperator may also take out insurance to cover its loss in case
of loss or damage of SSF.

NOW THEREFORE, for and in consideration of the forgoing, the parties hereby agree
as follows:

I. Description of Usufruct or Property Subject hereof.

The following machinery/equipment will be transferred to AGREA Foundation, as the

COOPERATOR of the SSF.

PARTICULARS DESCRIPTION QTY UNIT COST TOTAL

Pedal Power DOH Accredited with capacity: 2000-3000GPD 8 pcs ₱ 15,000 ₱ 120,000
OIC-PD, DTI Marinduque
RONIEL M. MACATOL

Twiner, Spooler • 24 stage filtration and purification system

machine • Reverse osmosis membrane
• System installation including 2 units
stainless (grade 304) water tank with 1,000
liters capacity, 2 units RO membrane 6,000
GPD
• Knockdown sink included
• CE certification
Winnowing machine Food grade (stainless make up) 1 pc ₱48,500.00 ₱48,500.00
25 kg capacity
LPG fueled
With temperature gauge and control
JOEL B. VALERA, CESO III

Power: single phase 220V

RD, DTI MIMAROPA

CE certification
Manual Bailing Power: single phase 220 V 1 pc ₱28,000.00 ₱28,000.00
Machine High recovery efficiency (90%)
Food grade (stainless make up)
CE Certification

Coco Coir Loom Food grade (stainless make up) 2pcs ₱ 70,000.00 ₱ 140,000.00
Machine 50 kg capacity per hour
Power: single phase 220V
Certification : CE

Single Drum 4 kg capacity 1 pc ₱ 528,000.00 ₱ 528,000.00

Decorticating Power: single phase 220V
Machine Food grade (stainless make up

TOTAL ₱ 864,500.00

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 II. Duties and Responsibilities of DTI-MIMAROPA

a. Agrees to grant the COOPERATOR the usufruct of the equipment, with possession,
use and enjoyment of the said equipment, as well as the right of management of the
President & CEO, AGREA Foundation

same;

b. Shall transfer and turn-over the equipment directly to the COOPERATOR;

CHERRIE D. ATILANO

c. Shall provide insurance for the first year from execution of this Agreement to cover
loss or damage to the machinery/ equipment due to but not limited to fire, theft, flood,
earthquake or other causes;

d. May demand from the COOPERATOR to make the necessary repair on the subject
equipment. Should the latter fail to make them after said demand, the former shall
make them at COOPERATOR’s expense;

e. It shall, upon receipt of notice from COOPERATOR be responsible for extraordinary

repairs on the subject equipment hereof;

III. Duties and Responsibilities of COOPERATOR

a. Shall acknowledge in writing the receipt of the equipment from DTI-MIMAROPA;

b. Shall submit to DTI-MIMAROPA its Manual of Operations and Name of authorized

representative to transact with DTI-MIMAROPA;
OIC-PD, DTI Marinduque
RONIEL M. MACATOL

c. In using the equipment, subject hereof, it shall take as much care thereof as a good
father of the family or person of ordinary prudence would take of his own property;

d. Shall not transfer the equipment to any other persons or unrelated outsiders, without
DTI-MIMAROPA’s prior written consent;

e. Shall not use the equipment for any purpose other than for which it is intended nor
for unlawful purpose or purposes;

f. Shall operate, perform repair and maintain, and ensure safekeeping of the equipment
in the facility including responsible property custodianship and turn over the above to
DTI-MIMAROPA in the event that compliance to the stipulations in the Manual of
Operations can no longer be achieved;
JOEL B. VALERA, CESO III
RD, DTI MIMAROPA

g. Shall keep the substance of the equipment unaltered; and shall undertake ordinary
maintenance and petty repairs. By ordinary repairs are understood such as are
required by the wear and tear due to the natural use of the thing and are
indispensable for its preservation;

h. It shall notify DTI-MIMAROPA of the need to carry out extraordinary repairs on the
subject equipment;

i. It shall bear all expenses for the management of the equipment; pay taxes and duties;
and be responsible for all interest payments on debts charged upon it;

j. It shall, at its own expense, insure the equipment against loss from the second year
and throughout the period of this Agreement;

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 k. It may be obligated to indemnify DTI-MIMAROPA for any deterioration the equipment
may have suffered by reason of its own fraud or negligence, subject to the terms and
conditions provided under the Insurance Contract,
President & CEO, AGREA Foundation

l. It shall notify DTI-MIMAROPA of any act of a third person, of which he may have
CHERRIE D. ATILANO

knowledge, that may be prejudicial to the rights of ownership, otherwise it shall be

liable for damages, as if they had been caused through its own fault;

m. It shall bear any and all expenses, costs and liabilities in suits brought with regard to
the subject equipment;

n. Shall periodically submit to the DTI-MIMAROPA Regional Office reports of physical

accomplishments and financial records and all other monitoring and evaluation of the
equipment.

IV. Common Duties and Responsibilities

a. Both parties hereby undertake to abide by existing and applicable DBM and COA
rules relative to actions or transactions involving the Usufruct;

b. Recognized and respect each other’s respective rights, duties and responsibilities
under this agreement.
OIC-PD, DTI Marinduque

V. Period of Usufruct
RONIEL M. MACATOL

Such usufruct rights shall remain enforce for a period of two (2) years.

VI. Breach of Agreement

In case of breach hereof by one party, the other party has the right to terminate the
contract. If the breach is committed by the Cooperator, DTI has the right to terminate
the MOA and usufruct over the machinery/equipment/tools and to consequently
repossess or pull out the machinery/equipment/tools and transfer the same to another
eligible Cooperator.

VII. Extinguishment of Usufruct

The usufruct may be extinguished upon prior reasonable notice, as follows:
JOEL B. VALERA, CESO III

a. By the expiration of the period for which it was constituted or by the fulfillment of
RD, DTI MIMAROPA

any resolutely condition;

b. By merger of the usufruct and ownership in the same person;
c. By renunciation of COOPERATOR.
d. By the total loss of the thing/property in usufruct;
e. By the termination of the right of the person constituting the usufruct.

VIII. Effect of Termination or Extinguishment of Usufruct

a. The machinery/ equipment shall be appraised to determine its depreciated value
or residual value for purposes of transfer, sales or disposal by DTI-MIMAROPA.
A depreciation schedule for said machines/equipment shall be provided for and
form an integral part of the MOA.

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 b. The DTI-MIMAROPA may transfer the machinery/equipment to another
government association or entity for the continuous use of said COOPERATOR.
In such case, the DTI-MIMAROPA, the COOPERATOR and that government
association or entity shall enter into a tripartite agreement governing the transfer
for the benefit of the COOPERATOR.
In case the preferred mode of transfer of the machinery/equipment at the end of
the usufruct agreement is through sale, the depreciated value or residual value of
the machinery/equipment maybe used as the basis for the sale in accordance with
COA rules and regulations.

VIII. Arbitration Clause

Any dispute that may arise relative to the execution of the Usufruct Agreement shall
be brought to the SSF National Technical Working Group (NTWG).

X. Affectivity
This Agreement shall take effect upon signing hereof.

IN WITNESS WHEREOF, the parties have hereunto set their hands this ___ day of
______________, 2020.

DTI-MIMAROPA Regional Office COOPERATOR

By: By:

JOEL B. VALERA CESO III CHERRIE D. ATILANO

Regional Director President & CEO
AGREA Foundation

SIGNED IN THE PRESENCE OF:

RONIEL M. MACATOL
OIC-PD, DTI MARINDUQUE Chairman, BLGU Cawit

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 ACKNOWLEDGEMENT

REPUBLIC OF THE PHILIPPINES)

CITY OF __________________ )SS

BEFORE ME, Notary Public for and in _______________, this ___ day of _______,
2020, personally came and appeared the following:

NAME VALID ID PLACE/DATE ISSUED

RD JOEL B. VALERA CESO III

CHERRIE D. ATILANO

Known to me and 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.

WITNESS MY HAND AND SEAL.

Doc. No.:
Page No.:
Book No.:
Series of 2020.

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