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CONTRACT OF LEASE

This Agreement is made and entered into this ____ day of _______ 2018 by and
between:

LUCITA ELAGO ALGABRE, of legal age, Filipino, married to PORFIRIO


ALGABRE and a resident of 1971 Brgy. Dita, Sta. Rosa, Laguna and
hereinafter called the LESSOR,

and

CLOVERRIG PETROLEUM TRADING CORPORATION, a corporation


duly organized and existing under Philippine laws, with principal business
address at Lot 12 Muntinlupa Estates Poblacion Muntinlupa, represented herein
by its authorized representative, WELLY TOHA and LESLIE Q. RATUISTE
as evidenced by a Secretary’s Certificate dated _____________ and a Board
Resolution dated ________________ (attached as Annexes “A” and “B” of this
Contract), hereinafter called the LESSEE.

W I T N E S S E T H:

WHEREAS, the LESSOR is the registered, true and absolute owner of a parcel of
land with a land area of One Thousand Four Hundred Four (1,404) square meters, more or
less, if any, situated at Barangay Dita, Sta. Rosa City Laguna and covered by Transfer
Certificate of Title ("TCT") No. 40174 issued by the Registry of Deeds for the Calamba City
Laguna (the "Leased Property" and/or “Property”), certified true copies of TCT No. 40174
covering the Lot Property are attached hereto as Annexes “C” and "D" and made an integral
part hereof, a portion of which, Six Hundred (600) square meters more or less shall be leased
to the LESSEE.

WHEREAS, the LESSOR has represented and assured the LESSEE that the Lot
Property is free and clear of any burdens, liens, encumbrances, and occupants, and that it is
physically and legally suitable for the construction and operation of a gasoline station and
there are no restrictions or any impediments on the Lot Property or his title and right to
possess and lease the same that will prevent the LESSEE from operating a Gulf Gasoline
Service Station;

WHEREAS, on the basis of and relying on the foregoing representations of the


LESSOR and the documents he presented, the LESSEE offered to lease the above-described
property, (as shown in the Lot Plan and Geodetic Survey attached hereto as Annex “E”,
(referred hereinafter as the “Leased Property” and/or “Property”) for the construction and
operation of the Gulf Gasoline Service Station, and the LESSOR has agreed to grant the
LESSEE lease over the same for the said purpose;

NOW, THEREFORE, for and in consideration of the rental fees and compliance with
all the conditions and covenants hereinafter contained, the LESSOR hereby leases unto the
LESSEE the Leased Property under the following terms and conditions, to wit:

1. LEASED PROPERTY. LESSOR leases unto the LESSEE a portion of the said
property with an aggregated area of Six Hundred (600 sq.m.) square meters, more or
less.
2. TERM. The term of the lease shall be for Fifteen (15) years starting at the end of the
Rent Free Period (“anniversary date”), renewable upon mutual agreement of the
parties. No implied new lease shall arise out of this Contract. One year before the
expiration of this Contract, the Parties shall come up with an agreement whether or not
to continue with the Contract. The agreement shall be reduced into writing and
embodied in a public instrument. The agreement shall in no way be treated as the new
Contract of Lease between the Parties.

3. RENT FREE PERIOD. The LESSEE is granted a Rent-Free Period of six (6) months
for the construction and for securing all necessary permits and licenses for the
operation of gasoline service station and will automatically expire at the end of the
construction or 6 months of the Rent Free Period, whichever comes first, without
further extension. Expenses during the construction, such as utilities, shall be for the
account of the LESSEE.

During the Rent Free Period, the LESSOR shall not, and shall not permit any of its,
heirs, legal representatives, assigns, successors, at any time during the Rent-Free
Period, to enter into, negotiate, entertain any other party with respect to the lease or
use or enter into a similar arrangement with other parties with respect to the Lease
Property. The parties understand that a breach of this provision by the LESSOR is a
material breach of this Contract and will entitle the LESSEE to automatically
terminate the same, without prejudice to the availment by the LESSEE of other
remedies provided under the law.

4. RENTAL. The Rental shall be Sixty Thousand Pesos (PhP60,000.00) VAT-exclusive


per month and shall automatically increase FIVE (5) PERCENT starting on the third
year and every three (3) years thereafter.

The LESSEE shall pay the LESSOR upon the release of Barangay Resolution and
Locational Clearance, the Twelve (12) months advance rental fee amounting to Seven
Hundred Seventy Thousand Four Hundred Pesos (PhP770,400.00) inclusive of VAT
applicable to the first year of the lease.

Thereafter, the LESSEE shall pay a monthly rental, starting after the Rent-Free period
provided for in Paragraph 3 hereof, without need of demand, based on the following
schedule:
The above payment schedule shall be duly covered by post-dated checks to be issued
by the LESSEE. Upon execution of this Contract, the LESSEE shall issue such
number of post-dated checks covering the monthly rentals for the first year of the lease
after the application of the Advance Rental. Thereafter and on or before every
Anniversary Date, LESSEE shall issue another twelve (12) checks for the monthly
rentals for the applicable year.

The LESSEE shall issue checks corresponding to one year deposit (“Security
Deposit”). The Security Deposit shall be applied to the Rentals based on the prevailing
rate upon termination of this Contract. The LESSEE warrants that all checks issued in
relation to this Contract are sufficiently funded.

If the national of local government would deny the LESEE the permit to operate a
petroleum station on the Leased Property, this contract shall be pre-terminated. The
full amount of the advance rental shall be immediately returned to the LESEE.

5. CARE OF LEASED PROPERTY. The LESSEE shall, at its expense, maintain the
Leased Property in a clean and sanitary condition. The LESSEE shall keep and to take
care of the Leased Property with the diligence of a good father of the family, unless
otherwise provided by Philippine laws.

The LESSEE must notify LESSOR in writing within five (5) days of any damage to
the Leased Property, as well as any occupation, usurpation or untoward act which any
third persons may have committed or may be committing or threatening to do upon the
Leased Property.

The LESSEE shall be responsible for all repairs of the Leased Property. The LESSEE
shall hold the LESSOR, his agents, representatives or persons directly connected with
him, free and harmless from any action, whether civil, criminal, administrative or
otherwise or from any claim of any kind or character arising out of or in connection
with the making of such repairs or the completion of such works for the preservation,
conservation and maintenance of the building and/or the Leased Property.
6. TAXES. The Value-Added Tax (VAT) as well as taxes on income (taxes to be withheld
by the LESSEE) shall be for the account of the LESSEE. The LESSEE shall submit to
the LESSOR the corresponding Certificate of Tax Withheld every quarter.

The LESSOR shall pay the real property tax pertaining to the land on the Leased
Property, while real property taxes on all improvements shall be borne by the
LESSEE.

Any change or amendment in a government statute, regulation, memorandum or


circular or any change in the status of the LESSOR that directly or indirectly affects
and/or alters the tax rates, implication or consequence shall generally be for the
account of the LESSOR, unless the change or amendment shall expressly indicate
otherwise. In any case, the basis for new tax rates shall always be computed on the
Base Monthly Rental indicated in provision 4 herein.

7. IMPROVEMENTS. The LESSEE shall have the right to introduce and construct on
the Leased Property any building and/or structure suitable and useful for its business
purpose, the ownership of which shall be transferred to the LESSOR at the
termination, including a pre-termination, of this Contract of Lease by either of the
Parties, without need of reimbursement.

However, the various equipment installed, such as machineries and other movables
used by the LESSEE in its principal business or trade, such as the Electric Dual
Dispenser Pumps, Underground Tanks, Underground Tanks Split, Canopy Signage,
Price Board Directory, Pylon Post Signage and the Pump Spreader, shall remain under
the exclusive ownership by the LESSEE even beyond the expiry of this Agreement, or
in cases of pre-termination. In such case, the LESSEE shall have the right to remove
the same within a reasonable time, at its sole expense, provided no damage is caused
to the Leased Property. Any damage caused to the Leased Property arising from the
exercise of the right to remove shall be the sole and exclusive liability of the LESSEE.
The LESSEE shall still be liable for rental at the latest rate during the time of removal.

Upon the termination, including a pre-termination, or expiration of this Agreement


under any circumstance, the LESSEE shall return the Leased Property to the LESSOR
in a condition suitable for continued use as commercial or similar end-use, ordinary
wear and tear, reasonable use and other unavoidable losses excepted.

8. ANNOTATION OF LEASE. – The LESSOR shall annotate or register this


Agreement in the Transfer Certificate of Title within a period of sixty (60) days after
signing. Expenses for the annotation shall be for the account of the LESSEE.

9. PRE-CONDITIONS FOR THE LEASE. The existing improvements in the Property


shall be demolished within ___ days from the execution of this Contract. Any costs for
demolition, such as but not limited to permits, shall be shouldered solely and
exclusively by the LESSEE. Once the demolition job has been completed, the
LESSEE agrees to construct a gasoline station and a two-storey commercial building
within a period of ___ months.

The LESSEE also binds himself that the possession, use, operations and other aspects
of ownership of the first storey of the commercial building shall belong to the
LESSOR. Any income arising from the possession, use, operations and other aspects
of ownership of the first storey of the commercial building shall also accrue to the
account of the LESSOR.
10. PRE-TERMINATION OF LEASE. The LESSEE has the right to cancel or pre-
terminate the lease without need of judicial action. The LESSEE shall give the
LESSOR a written notice of pre-termination/cancellation which shall become effective
ninety (90) days from the LESSOR’s receipt.

In case of pre-termination or expiration of lease, the LESSOR shall return all monies
paid in advance by the LESSEE under this Contract, which includes the Security
Deposit and any unused portion of the Advance Rental, within thirty (30) days from
effectivity of the pre-termination unless the Security Deposit has already been applied
to the Rentals.

Expenses necessary for the removal of all the improvements constructed on the Leased
Property shall be shouldered by the LESSEE.

11. ASSIGNMENT AND SUBLEASE. The LESSOR understands that the LESSEE
shall establish a Gulf gasoline service station operated by pre-qualified dealers and
other businesses, hence, the LESSEE shall have the right to sublease and assign the
Leased Property or any portion thereof, except the first storey of the commercial
building, provided it shall notify the LESSOR at least fifteen (15) days before the
LESSEE turns over the Leased Property or any portion thereof to the sub-lessee. The
term of any Contract between the LESSEE and its SUB-LESSEE/S shall in no way
exceed the original term of this Contract of Lease referred to in Section 2 of this
Contract. The LESSOR shall have the right to inspect, review and/or object to any
Contract between the LESSEE and the SUB-LESSEE/S prior to its execution. No
privity of contract exists or shall exist between the LESSOR and SUB-LESSEE/S of
the LESSEE.

12. LESSOR’S WARRANTIES. The LESSOR warrants the following: (1) that all taxes
and fees on the leased property have been fully paid upon the signing of this lease; (2)
that the subject property has no existing lease in effect with any third party nor is the
property subject of any claim from third parties; (3) that he/she has the absolute right
to lease out the Leased Property to the LESSEE and shall keep the LESSEE in the
peaceful possession thereof for the duration of the Term of Lease and that there are no
tenants, squatters, or other individuals occupying the Leased Property, or any portion
thereof; (4) that he/she shall comply with its legal obligation to protect LESSEE’s
peaceful possession, control and use of the leased property and that of the latter’s
successors-in-interest against any and all persons whomsoever; and (5) he shall
indemnify, defend, hold harmless the LESSEE from any and all claims, liabilities and
actions in case of any violation of any of the warranties.

13. RIGHT OF FIRST REFUSAL. Should the LESSOR decide to sell a part or all of
the Leased Property during the term, renewal or extension of this Agreement, the
LESSEE shall be given the first option to purchase the same at the same price, terms
and conditions as offered to any other person. The LESSOR shall notify the LESSEE
at least fifteen (15) days before offering for sale the Leased Property to third parties.
14. SALE OF THE LEASED PROPERTY. In the event that the ownership, possession,
use or enjoyment of the Leased Property or any portion thereof is sold, transferred,
conveyed, assigned, mortgage, or encumbered to a third party during the term of this
Agreement or any renewal or extension thereof, the LESSOR shall notify the LESSEE
of such transaction within fifteen (15) days prior thereafter. The LESSOR shall inform
the said third party, his successors, executor, administrator, mortgagee, or assignee, in
writing, of this Agreement, and undertakes to (a) require the incorporation in the Deed
of Sale or Mortgage, or other deed or instrument, either by reference or otherwise, of
the terms and conditions of this Agreement; and (b) require them to recognize, respect,
assume and abide by all the terms, covenants, obligations and conditions of this
Agreement. The LESSOR shall be liable to and shall indemnify the LESSEE for
whatever damage the LESSEE may suffer in the event said third party does not or fails
to respect, recognize, assume and abide by any of the terms, covenants, obligations
and conditions of this Agreement.

15. FORCE MAJEURE. Non-performance of obligations due to force majeure shall hold
neither party liable. The party claiming force majeure shall notify the other party
within seven (7) days from knowledge of force majeure.

16. NO WAIVER. A party’s failure to exercise or enforce any of its rights under this
Agreement shall not constitute a waiver of any breach by the other party of any terms
thereof. The exercise by the innocent party of any remedy under this Agreement will
be without prejudice to its other remedies allowed by law.

17. MEDIATION. Before resort to litigation, the parties agree to refer any controversy
before the Philippine Mediation Center, Sta. Rosa, Laguna, for mediation.

Nothing from this Paragraph shall be construed as to prohibit either Party to petition
for or file provisional remedies or similar remedies before a regular court to
immediately protect a Party’s interest. Such petition or action may be filed before the
proper courts in Sta. Rosa, Laguna, Philippines, at the option of the suing party, to the
exclusion of all other venues.

18. LITIGATION AND VENUE OF ACTIONS. All actions and controversies that may
arise from this Agreement shall be brought exclusively before the proper courts in Sta.
Rosa, Laguna, at the option of the suing party.

19. NOTICES. All notices to be given hereunder to the LESSOR or the LESSEE shall be
given at its address as stated in this Agreement and shall be deemed sufficient unless a
different address is given by the parties in writing.

20. ENTIRE AGREEMENT. This Agreement shall constitute the entire agreement
between the parties. Any understanding or representation of any kind preceding the
date of this Agreement shall not be binding on either party except to the extent
incorporated in this Agreement.

21. BINDING EFFECT OF AGREEMENT. This Agreement shall apply to and be


binding on the heirs, legal representatives, successors, and assigns of both parties.

22. SEPARABILITY CLAUSE. Invalidation of any one of the terms, conditions,


restrictions or other provisions contained herein by judgment or court order shall in no
way affect any of the other terms, conditions, restrictions or provisions hereof, and the
same remain in full force and effect.
IN WITNESS WHEREOF, the parties have hereunto set their hands at the place first
above written on ____________________________.

LESSOR LESSEE
CLOVERRIG PETROLEUM TRADING
CORPORATION

By:

____________________________
LUCITA E. ALGABRE ______________________________
WELLY TOHA
President

_______________________________
LESLIE Q. RATUISTE
Corporate Secretary

SIGNED IN THE PRESENCE OF:

______________________________ ____________________________

ACKNOWLEDGMENT
REPUBLIC OF THE PHILIPPINES)
_____________________________ ) S.S.
X- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - X

BEFORE ME, on this ___ day of _______________________, 2018 at the


_____________________________, personally appeared the following persons with their
respective Driver’s License or Passport set opposite their names:

NAME ID NO. DATE PLACE OF


ISSUANCE
LUCITA E. ALGABRE
WELLY TOHA
LESLIE RATUISTE

known to me and to me known to be the same persons who are personally known to me and
who were identified by me through competent evidence of identity to be the same persons
described in the foregoing instrument, who acknowledged before me that their respective
signatures on the instrument were voluntarily affixed by them for the purposes stated therein,
and who declared to me that they have executed the instrument as their free and voluntary act
and deed, and of the corporation represented herein.

The foregoing instrument refers to a Contract of Lease, consisting of Eight (8) pages
including this page wherein the acknowledgment is written, has been signed by the parties and
their witnesses on each and every page hereof.

IN WITNESS WHEREOF, I have set my hand and affixed my notarial seal this
______ day of _______________, 2018 at _______________.

Notary Public

Doc. No. ___________;


Page No. ___________;
Book No. ___________;
Series of 2018.

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