CONTRACT OF LEASE

KNOW ALL MEN BY THESE PRESENTS:

This Contract of Lease is made and executed at the City of _______________,

this day of ____________________, 2017, by and between:

KYOOB, INC., a corporation duly formed and existing under

Philippine Law, represented by SALVATORE PETER LA
BARBERA (Chief Executive Officer), with postal address at
KYOOB Complex, Ouano Avenue, North Reclamation
Mandaue City, Philippines, hereinafter called “LESSEE”

And

JO ALEGATA, et.al. _____________________________________________

__________________________________________________________________

__________________________________________________________________,
hereinafter referred to as the “LESSOR”.

CONDITIONS AND RESTRICTIONS

This Agreement covers the lease of a commercial lot with improvements

thereon, hereafter known as Unit No. _____________________ Commercial Lot
_______________________________ sq meters. (SEE EXHIBIT “B” AREA
OUTLINED IN RED)

1. TERM: This Rental Agreement shall start on 01 MAY 2017 and

expire at noon on 31 OCTOBER 2027, renewable thereafter at the
will of the LESSEE for an additional ten (10) year period subject
to new set of terms and conditions to be agreed upon by the
parties.

2. 1 RENTALS: The LESSEE agrees to pay the LESSOR the sum of:

Thirty thousand pesos (Php 30,000.00) per month for months 1-6
of the lease term, all due and payable upon execution of the
subject lease;

Forty Thousand pesos (Php40,000.00) per month for months 7-

120 of the lease term; and

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 Starting on months 13 up to 120, the rental shall be subjected
to an increase of ten percent (10%) per annum and every
year thereafter.

2. 2 ADDITIONAL RENT: LESSEE hereby agrees to pay annually the

property tax assessed by the Municipality of Bacong in behalf of
the property owners.

All payments shall be due in advance for the first six month
period, the next twelve month period, and each twelve month
period thereafter.

All advanced payments shall be paid thru a post dated cheque

which shall indicate and specify the names of the LESSORS.

3. SECURITY DEPOSIT: The LESSOR adopts the issue of advanced

rental payment, which means the LESSEE shall pay one hundred
eighty thousand pesos (Php 180,000.00) prior to LESSEE entering
and taking possession of the property. The advanced rental
payment shall be separate and distinct from the security
deposit which shall be equivalent to six (6) months rental.
The security deposit shall be answerable for any damages
that may be caused to the premises by the LESSEE. Thereafter,
the LESSEE shall make annual payments of four hundred eighty
thousand pesos (Php 480,000.00) in advance of the year the rent
is due throughout months 7-120 of the agreement, subject to the
ten percent (10%) increase per annum and every year
thereafter. Further, in the event the LESSEE gives notice to
LESSOR of its intent to extend the Lease period beyond one
hundred twenty (120) months, a new set of rental payment
scheme shall be agreed upon by the parties.

4. REMOVAL OF PERSONS AND UNWANTED STRUCTURES: The

LESSOR agrees to offer said property “free and clear” of any
impediments including, but not limited to the current tenant,
squatters, or any buildings or structures of any kind or nature
whatsoever, starting on the second (2nd) month of the lease term.
During the first two (2) months of the lease term, LESSEE shall
conduct its best effort in securing a building permit so as to erect
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 a SHIPPING CONTAINER CONSTRUCTION ASSEMBLY PLANT
approximately 136’ x 190’ in size. Said building shall be
approximately 35’ at its highest point and shall be of open
warehouse design on the subject property. LESSOR shall fully
cooperate with LESSEE toward this end and agrees to sign any
and all documents required by the municipality given the
authority to issue subject permits. LESSOR HEREBY
ACKNOWLEDGES AND AGREES TO ALLOW LESSEE THE RIGHT
TO REMOVE ALL EXISTING IMPROVEMENTS NOW LOCATED ON
THE SUBJECT PROPERTY, AND WILL FOREVER HOLD LESSEE
HARMLESS FROM DOING SAID REMOVAL.

5. UTILITIES: The LESSEE shall pay separately electric, telephone,

water and other utility bills within seven (7) days from the receipt
of the bill.

6. LESSEE-OWNED PERSONAL PROPERTY: Upon entry, it shall be

compulsory to declare all potentially dangerous, hazardous
materials and other related machines or equipment to the LESSOR
who has the right to refuse the entry of illegal, dangerous, or
contraband equipment, as well as the right to confiscate any
newly discovered item of similar nature that was not declared
upon entry or during the period of the lease. The LESSEE shall
bear the sole responsibility for the safety of his equipment.

7. This CONTRACT OF LEASE IS BINDING. Upon the signing of this

agreement, the LESSEE shall pay the required advance rental for
the first six (6) months. The LESSEE agrees to conduct its
business as regulated by the SEC, to refrain from illegal activity, to
observe, abide and comply with all the applicable rules imposed
by the LESSOR and/or additional rules that may be attached to
this agreement marked as Annex “A”. If there are none, then this
Annex “A” shall be absent from this lease.

8. RIGHT TO HOLD UNIT: The property is deemed occupied upon

full payment of the rent. The right to hold the property belongs to
the LESSOR or his representative when the LESSEE fails or
neglects to pay his rent for at least two (2) months from when the
same is due. Upon expiration of the lease period or failure to pay
the rent, the LESSOR is obliged to lease the property to other
incoming or prospective LESSEES.

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9. RENEWAL/EXTENSION OF RENT. A LESSEE who desires to
renew or extend the rental agreement shall notify the LESSOR of
his intent at least two (2) months from date of expiration. In the
event of such renewal, the parties will agree on a new set of
terms and conditions, particularly with respect to the rentals.

10. PRE-TERMINATION: This agreement is guaranteed for a

minimum period of TEN (10) YEARS. Should the LESSEE opt to
terminate this agreement before the guaranteed period, the
LESSEE shall forfeit the advanced rental and security deposit
entirely in favor of the LESSOR.

11. CLEANING AND OTHER REQUIREMENTS: The LESSEE agrees

to care for the premises assigned to him by the LESSOR. He/she
shall be responsible for the sanitation and cleaning of the
property, security and property insurance where applicable.

12. ALTERATION AND/OR IMPROVEMENTS: The LESSEE shall

NOT make any alterations to the subject property after the initial
warehouse building has been built without prior written consent
from the LESSOR.

13. DAMAGE TO PREMISES AND EQUIPMENT: The LESSEE shall

be responsible for any damages caused to the premises due to
his/her negligence or omission. The cost of the damage shall be
deductible from the Security Deposit. Once the fifty percent
(50%) of the Security Deposit is consumed, the LESSEE shall
reimburse the said consumed Security Deposit to ensure that
the same shall be equal to the original amount. The LESSEE
holds the LESSOR free and harmless from any damage, liability, or
responsibility to or from any third person or property arising out
of or as a consequence of the use of the leased premises.

14. RIGHT OF INSPECTION: The LESSOR,

ADMINISTRATOR/LESSOR or his duly authorized representative
shall have the right to inspect the leased premises in the presence
of the LESSEE at any reasonable hour of the day after due notice
has been given, subject to the scheduling of the LESSEE.

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15. ASSIGNMENT AND SUBLETTING: The fact that this lease is
actually a Ground Lease Agreement has been made known to the
parties. The actual use of the property shall be for all related
storage and work required to convert shipping containers into a
variety of other structures which shall be sold to third parties.
This includes, but not limited to, commercial buildings, houses,
apartments, schools, hospitals, dormitories, etc.

16. INTEREST AND PENALTIES: If the LESSEE, paying on an actual

basis, does NOT pay his rent by the second (2nd) month following
its due date. LESSEE shall pay an additional penalty of five
hundred pesos (Php 500.00)/ per day until rent is paid in full. An
interest of five percent (5%) per month shall be imposed if the
rent and the penalties remain unpaid after a month. The interest
and penalty will continue until full settlement has been finally
made.

17. DEFAULT: Any default made in the payment of rent or in any

other terms of conditions, shall result in the termination and
forfeitures of the lease, at the option of the LESSOR. The LESSEE
will be given a written notice of such default or breach.
Termination and forfeiture of the lease shall not result if, within
thirty (30) days upon receipt of such notice, the LESSEE has
rectified such default. The LESSOR may reconsider against
termination or forfeiture only if the LESSEE has taken action to
affect a correction within a reasonable time. The rent is
considered in default if it remains unpaid for two (2) consecutive
months.

18. ABANDONMENT: If the LESSEE abandons the premises within

the duration of the lease agreement, the LESSOR or his duly
authorized representative may enter the premises without any
liability to the LESSEE for damages. The LESSOR may assign the
premises to other prospective LESSEES and shall collect all rent
payable by virtue of such assignment or sublease. The LESSEE
who abandoned the property will still be liable to the LESSOR for
any unpaid rent including interest and penalties. All personal
properties of the LESSEE who abandons the leased premises is
considered abandoned if, after the last day of the paid lease
period, the LESSE fails to contact the LESSOR of his whereabouts

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 or the LESSEE does not signify his intention to continue the lease
without prejudice to any causes beyond the control of the LESSEE.

19. TERMINATION OF RENTAL AGREEMENT: If the following

conditions exist, the rental agreement will be terminated: (a) The
expiration of the rental term has been reached; (b) The LESSEE
has committed violations against the LESSOR’S rules and
regulations during the lease period; (c) Default in the payment of
rent; (d) Abandonment of the leased premises; (e) Assignment
and subletting of the unit without prior approval from the
ADMINISTRATOR/LESSOR; and/or (f) Commission of grave
offenses injurious to other LESSEES.

In the event of termination of the rental agreement, the

LESSEE shall leave the structures and/or improvements
introduced on the premises.

20. EXTRA-JUDICIAL RE-POSSESSION OF LESSOR: In case the

LESSEE: (a) Incurred rentals-in-arrears equivalent to two-month’s
rent; or (b) has unpaid obligations upon the expiration,
termination, or pre-termination of this lease, or (c) has
abandoned the premises, the LESSEE agrees that the LESSOR may
enter the leased premises for the purpose of conducting a physical
inventory of the items found inside the premises in the presence
of two barangay officials or the representatives of the LESSEE, if
available, and to transport the items for safe-keeping by the
LESSOR. The LESSEE agrees that the LESSOR shall have a lien over
the items found inside the premises of the LESSEE of whatever
kind and the latter is empowered to take custody of the same until
the whole obligation is fully settled. If the LESSEE however fails to
pay the obligation after the lapse of thirty (30) days from the date
of physical inventory, the LESSOR is hereby appointed as the
LESSEE’s attorney-in-fact with the authority and power to sell or
dispose of any of the items in custody at prices deemed
reasonable by the LESSOR to collect deficiencies if the proceeds of
the sale cannot cover the arrears. Failure on the part of the
LESSEE to use the premises for a period of one (1) week from the
date of physical inventory without written notice or advice shall
also constitute desertion or abandonment. After the re-
possession, the LESSOR may lease the premises out to new
LESSEES/TENANTS.

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 21. LESSOR shall grant LESSEE possession of the subject property
immediately upon execution of this Lease Contract. Further,
LESSOR grants LESSEE permission to commence grading,
placement of foundation monuments, shipping containers, and
any and all other materials, labor, excavation, trenching, water
and electric power supply lines, septic tanks and systems
necessary for the completion and operation of a factory
warehouse on the property.

By signing this rental agreement, we confirm our acceptance of

the Terms and Conditions in this document and take responsibility for
the information disclosed herein.

All known to me to be the same persons who executed the

foregoing instrument consisting of _______________________ pages, and they
acknowledged to me that the same is their free act and deed.

IN WITNESS WHEREOF, I have hereunto set my hand and affixed

my notarial seal, the day, year, and place above written.

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