CONTRACT OF LEASE

KNOW ALL MEN BY THESE PRESENTS:

This CONTRACT OF LEASE made and entered into by and between:
Spouses CESAR E. AVILES and ARCELY A. AVILES, Filipinos, of legal ages, and
residents of Victory Norte, Santiago City, Isabela, hereinafter to as the LESSOR.
— and —
Red Eclipse Business Process Outsourcing, presented herein by its
Manager, REYNALDO T. ILARDE, JR., with boarding address at Unit 34–B
Quezon Avenue corner Gomez Street, Victory Sur, Santiago City, Isabela,
hereinafter referred to as LESSEE.
WITNESSETH THAT:
WHEREAS, in virtue of the Extrajudicial Partition executed on August 13, 2010 which
document is particularly described as Document № 4428, Page № 32, Book № 209, Series of
2010 in the Notarial Register of Atty. Nelia P. Natividad (the “Deed of Extrajudicial Partition”);
as well as the Deed of Donation executed on October 11, 2013 which document is particularly
described as Document № 1469, Page № 84, Book № XXIII, Series of 2013 in the Notarial
Register of Atty. Jose Romeo S. Dela Cruz (the “Deed of Donation”); as well as the Deed of
Donation executed on January 23, 2014 which document is particularly described as
Document № 2710, Page № 23, Book № XXVI, Series of 2014 in the Notarial Register of Atty.
Jose Romeo S. Dela Cruz (the Deed of Donation”); and an agreement made between Elmer E.
Aviles and Cesar E. Aviles in front of Bro. Rogelio E. Abellon, Isabela South District Supervising
Minister, on July 1, 2016, that the one half (1/2) of the second floor of the 3–story Building
erected on Lot № 136–A (TCT № T–208379) which is located along № 26 Daang Maharlika,
Victory Norte, Santiago City, Isabela, having an area of ninety–two point eighty–nine (92.89)
square meters shall be the portion and property of Cesar E. Aviles and the whole third floor of
the said Building shall be for Elmer E. Aviles and Sonny E. Aviles.

WHEREAS, the LESSEE is willing and able to lease from the LESSOR the one (1) door on
the second floor with a floor area of ninety–two point eighty–nine (92.89) square meters
identified herein as Unit 201 of the aforementioned building.

Now, THEREFORE, for in consideration of the herein provided lease rental. LESSOR
hereby by these presents lease in favour of the LESSEE the aforesaid premises subject to the
following terms and conditions wit:

I PERIOD
This Lease shall be for a period of ONE (1) year to commence on July 22, 2016 and
ends on July 21, 2017, renewable for another two (2) years under terms and conditions that
may mutually agreed upon by the parties. The LESSEE shall initiate the negotiation for the
renewal at least two (2) months before the expiration of the current period by submitting a
letter of intent to renew the lease contract, otherwise, the contract automatically expires on the
specified date on this paragraph.

II RENTALS
The LESSEE shall pay to the LESSOR for the use and occupancy of the aforesaid leased
premises a monthly rental of TWENTY THOUSAND PESOS (Php20,000.00) in the Philippine
currency, exclusive of VAT, to be payable in advance within the first week of each month but
not later than the seventh day of the month without the necessity of the demand or prior notice
form the LESSOR. A penalty of fifty pesos (Php50.00) per day of delay will imposed on the late
payment without prejudice to the other rights of the LESSOR as provided herein.

CONTRACT OF LEASE, July 22, 2016 to July 21, 2017

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Only CESAR E. AVILES or his wife, Arcely A. Aviles are the sole collector of the monthly
rentals shall be the absolute collector. Check monthly rental payments shall be named to Cesar
E. Aviles or Arcely A. Aviles and shall be deposited to the RCBC account № 9–01314648–4 of
the LESSOR (AVILES; Cesar or Arcely). The deposit slip shall be the proof of payment of the
LESSEE.
Any amendment and/or instructions to the LESSEE from the LESSOR’s part regarding
the rental collection shall be in writing and duly signed by the LESSOR or by the attorney–in–
Fact. Violation of this provision shall be aground for the LESSOR to unilaterally terminate this
Contract.

III SECURITY DEPOSIT

Upon signing of this Contract, the thirty thousand pesos (Php30,000.00) Security
Deposit shall not earn any interest and shall remain intact for the duration of the lease.
Security deposit shall be used after the termination of this Contract for the restoration of any
damages caused to the leased premises during the occupancy of the LESSOR and its agents or
guest not restored immediately.

IV UTILITY CHARGES
All expenses for water, electricity, telephone, internet, and other utilities in the leased
premises and other incidental expenses connected therewith such as repair and maintenance
brought by ordinary wear and tear shall be for the exclusive account of the LESSEE.

V REPAIRS, SANITATION, AND DAMAGED TO LEASED PREMISES

The LESSEE shall keep the leased premises in clean and sanitary condition at all times,
and the LESSOR reserves the right to be allowed access to the leased premises during
reasonable times of the day to verify compliance therewith. The LESSEE has inspected the
leased premises to its complete satisfaction and has found the same to be in good and
tenantable condition.
All expenses for the replacement of electrical lamps, and for the repair of electric
switches, convenient outlets, receptacles, circuit breakers and board, doors and its jambs and
locksets, leaky faucets, clogged drainages, toilet bowl, tank and its fittings, ceramic and vinyl
tiles, and other items included in the leased premises shall for the sole account of the LESSEE.
When the leased premises are returned, such items must be intact and in good working
condition.
In case damage to the leased premises or any portion thereof by reason of fault or
negligence attributable to the LESSEE, its agents, employees, customers or guests, the LESSEE
shall report immediately to the LESSOR and the LESSEE shall be responsible for undertaking
such repair or construction by the supervision of the LESSOR or LESSOR’s authorized
representative.
Concrete nails or common wire nails should not tolerate by the LESSOR to be used in
concrete walls, ceiling, floors, and columns. Instead, drilled holes should be performed and
inserted PVC tox with metal screws is very much recommended. Violation of this provision is
highly observed.
Existing electrical, plumbing or other services installation in the leased premises and in
the Building shall not be tampered with changed, altered.

VI USED OF THE LEASED PREMISES

The leased premises shall be used exclusively for office and/or business purposes only.
In no case shall it be converted for dwelling, sleeping or residential purposes nor shall LESSEE
be allowed to cook in the premises or to keep, deposit or store any obnoxious substances or
flammable materials or substances which might constitute a fire hazard. Any violations of this
provision shall constitute sufficient ground for the LESSOR to unilaterally and immediately
terminate this Contract.

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 For the purpose of uniformity and aesthetics, the LESSEE shall put and maintain at his
own expense only necessary signages as required by and approved by the LESSOR in front of
the Building, the side, and in the staircases, and in front of the leased premises. Furthermore,
no other signages shall be allowed by the LESSOR within the vertical boundaries of the leased
premises.
The LESSE shall affix, inscribe or paint any notice, sign or other advertising medium only
in the leased premises and after the approval of the LESSOR.

VII IMPROVEMENT
The LESSEE shall not introduce any structural changes, alterations or improvements in
the leased premises without the prior consent of the LESSOR. Upon the express written consent
of the LESSOR, the LESSEE may introduce improvements but the same shall belong to the
LESSOR once adhere to the leased premises without any obligation on the LESSOR’s part to
pay or refund its value subject, however, the LESSEE shall have the right to remove its
furnitures and fixtures placed in the leased premises which are capable of being removed
without causing damages to the premises.

VIII THIRD PARTY LIABILITY

The LESSEE, during its occupancy of the leased premises, shall hold the LESSOR free
and harmless from any and all liability or responsibility to any persons or property arising out of
or as a consequence of the use of the leased premises by the LESSEE, its agents, employees,
customers, visitors, or agents.

IX RIGHT OF LEASE NON–TRANSFERABLE

The LESSEE shall not directly or indirectly sublease, assign, or transfer its right of lease
over the leased premises or any portion thereof under any circumstance whatsoever any such
contract made in violation of this clause be null and void and not binding upon the LESSOR.

X RETURN OF THE LEASED PREMISES

Upon the termination of the leased period, or earlier for any reason whatsoever, LESSEE
shall within one (1) week to vacate the premises and return possession thereof to the LESSOR
peacefully unless this leave is extended for another period. It is expressly agreed that in the
event that the LESSEE has any outstanding accounts, either for monthly lease rentals or utility
charges, LESSOR is hereby authorized to apply the rental deposit and, if not sufficient, to retain
possession of LESSEE’s eqipments, furnitures or stocks in trade and to dispose of the same
and proceeds applied to LESSEE’s accounts.

XI FAILURE TO PAY RENT

In the event that the LESSEE fails to pay the agreed rental herein stipulated strictly in
accordance with the provisions specified herein, or if the LESSEE, in any manner whatsoever,
violates the terms and conditions of the Lease Contract, LESSOR shall have the right to
unilaterally rescind this Contract, eject the LESSEE from the premises and take possession of
the leased premises even without court order.

XII REAL PROPERTY TAXES AND LICENSES

All real property taxes and licenses due on the aforesaid land and building affected by
this lease shall be the responsibility and shall be paid by the LESSOR.

XIII OPTION TO BUY

Should the LESSOR decide to sell the property subject matter hereof during the term of
this lease, the LESSEE shall have the first option to buy the same within a period of sixty (60)
days from receipt by the LESSEE of written notice by the LESSOR or his offer to sell said
property.

XIV PRE–TERMINATION
The LESSEE shall notify the LESSOR in writing at least three (3) months in advance
should the LESSEE decide to pre–terminate the Contract on the premises. The LESSEE shall

CONTRACT OF LEASE, July 22, 2016 to July 21, 2017

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have the option to pre–terminate the Contract before the expiration of the Contract of Lease,
provided, however, that the Security Rental Deposit shall be forfeited in favor to the LESSOR.

XV LITIGATION
In the event the LESSOR is obliged to initiate a suit to enforce the terms and conditions
of this agreement, the LESSEE hereby agrees to be liable for attorney’s fees in the sum of
twenty percent (20%) of the amount due and additional ten percent (10%) of the amount due
as liquidated damages. Both parties hereby agreed that the proper court setting is in Santiago
City, Isabela and shall have exclusive jurisdiction over any litigation between the parties by
virtue of this Contract.

IN WITNESS WHEREOF, the parties have hereunto affixed their signatures this
_____________________________ at Santiago City, Isabela, Philippines.

LESSOR LESSEE

CESAR E. AVILES Red Eclipse Business Process

SSS № 01–0795334–8 Outsourcing

ARCELY A. AVILES By: REYNALDO T. ILARDE, JR.

PhilHealth ID № 06–000032413–5 Driver’s License № B12–16–S01238
Expires on April 6, 2017

Signed in the presence of

_____________________________ _____________________________

ACKNOWLEDGMENT
Republic of the Philippines )
City of Santiago, Isabela ) s.s.

BEFORE ME, this _____________________________ at Santiago City, Isabela,

Philippines, personally appeared to me the above–named persons known to me and to me
known to be the same is their free and voluntary act and deed including those of the parties
represented herein.

This Contract of Lease consisting of four (4) pages including the page on which this
Acknowledgment is written has been signed by the parties hereto together with the witness
therein.

WITNESS MY HAND AND SEAL on this date and the place first above written.

Doc. №:

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Page №:
Book №:
Series of 2016

CONTRACT OF LEASE, July 22, 2016 to July 21, 2017

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