JOINT VENTURE AGREEMENT: Campus Estate Development of The Adventist University of the Philippines

Adventist University of the Philippines 2004

Puting Kahoy, Silang, Cavite

The AUP Campus Estate Subdivision Project: JOINT VENTURE AGREEMENT

JOINT VENTURE AGREEMENT
by Save Aup on Wednesday, September 29, 2010 at 5:21am
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Know all men by these presents:

This Joint Venture Agreement (“Agreement” for brevity), made and entered into this 18th day of December 2009 at Silang, Cavite by and between:

Adventist University of the Philippines, a religious educational institution duly recognized and existing under and by virtue of the laws of the Republic of the Philippines with office address at Puting Kahoy, Silang, Cavite, represented in this act by its President, Dr. Gladden O. Flores, hereinafter referred to as the OWNER,

-and-

Wilper Construction, Inc., a corporation duly organized and existing by virtue of the laws of the Philippines, with principal office address at Suite 210, Eagle’s Court Condominium, No. 26 Matalino St., Diliman, Quezon City, represented in this act by its President, Engineer Wilfrido Castor, hereinafter refeerred to as the DEVELOPER.

WITNESSETH: That –

Whereas, the OWNER is an assignee of several parcels of land from the North Philippine Union Conference Corporation of the Seventh-day Adventists, situated in Puting Kahoy, Silang, Cavite of the Register of Deeds of Tagaytay City, more particularly described as followed, to wit:

Transfer Certificate of Title
No. T—72512 …containing an area of TWO HUNDRED SEVENTY THREE THOUSAND SEVEN HUNDRED THIRTY FIVE (273,735) SQ METERS, more or less.

Transfer Certificate of Title
No. T—72520 …containing an area of SIXTY THREE THOUSAND EIGHT HUNDRED NINETY-NINE (63,899) SQ METERS, more or less.

Transfer Certificate of Title
No. T—72514 …containing an area of TWENTY-SIX THOUSAND SIX HUNDRED TWENTY-FIVE (26,625) SQ METERS, more or less.

Transfer Certificate of Title
No. T—72521 …containing an area of ONE HUNDRED SIXTY THOUSAND TWO HUNDRED TWENTY-FIVE (160,225) SQ METERS, more or less.

Transfer Certificate of Title
No. T—78206 …containing an area of THREE HUNDRED TWENTY-FOUR THOUSAND FIVE HUNDRED SEVENTY-NINE (324,579) SQ METERS, more or less.

Whereas, the above parcels of land will form part of a 27-hectare subdivision development.

Whereas, the DEVELOPER is engaged in construction business and development of subdivisions.

Whereas, the OWNER has accepted the offer of the DEVELOPER to have portions of the aforementioned property converted into an exclusive residential subdivision.

NOW THEREFORE, for an in consideration of the foregoing and of the stipulations herein contained, the parties have agreed as follows:

1. That the DEVELOPER shall, at its own expense survey and prepare the subdivision plans, engineering designs, and such other plans in accordance with the rules and regulations or as required by Housing and Land Use Regulatory Board (HLURB), Bureau of Lands, and such other government agencies that regulate or control or may hereinafter regulate or control the construction and development of residential subdivisions;

2. That the DEVELOPER shall secure and pay at its own expense for all the necessary licenses plus the cost of the required bond, permits, approval from the Local Government, HLURB, MERALCO and all other government agencies having authority on residential subdivision with full cooperation by the OWNER;

3. That the DEVELOPER shall provide at its own expense all the materials, equipment, labor and services in the development of the said parcel of land into a residential subdivision all in accordance with the subdivision plan and with the plans and specifications and design standards approved by the OWNER and HLURB; The common facilities and amenities shall consist of a clubhouse containing a social hall, game room, function rooms, gym, and showers/lockers, plus a chapel, basketball and volleyball courts, tennis courts, adults’ and children’s swimming pools, children’s playgrounds, and fully-landscaped parks in open spaces around the entire project. Other project amenities/facilities include a central entrance plaza with guardhouse, two minor gates, access road from the highway to the subdivision with the OWNER providing the right of way, perimeter fence, centralized water supply system, tree-planting along the main roads, and street-lighting;

4. That the DEVELOPER’s obligation to develop the property shall commence immediately upon the peaceful transfer of custody of the said property, and upon procurement of DAR conversion or exemption clearance, which shall be the responsibility of the negotiator, Dr. Tomas A. Meneses Jr., however, the OWNER shall shoulder all expenses related for its procurement. The OWNER guarantees peaceful possession of the same and will shoulder all disturbance compensation due to all occupants, squatters, or tenants. However, the initial area to be developed shall be the areas covered by TCT-T-72512 and TCT-T-72514 as they are not under lis pendens. Moreover, priority of development shall be Phase 1-A and Phase 1-B. The development of the other areas under lis pendens (TCT-T-72520, TCT-T72521, and TCT-T-78206) shall follow after the lis pendens case shall have been settled.

5. That the DEVELOPER guarantees completion of the development work, which include among others, roads & bridges; sewage treatment plant (STP); culverts & drainage system; perimeter fence; and amenities as enumerated in paragraph No. 3, except for the completion of electrical facilities which is solely MERALCO’s responsibility, if not prevented by force majeure or fortuitous event or by competent authority, within three (3) years from the date of procurement of the development permit from the Local Government Unit (LGU). Force majeure or fortuitous events shall include wars, serious calamities, very serious dearth of construction materials and other similar events that shall hamper pursuit of development. Provided that, the period for securing approval of the development permit from the LGU shall be within one (1) month from the procurement of the DAR exemption clearances or conversion order;

6. That the OWNER or any of its designated representatives shall have the right to inspect the subdivision to determine compliance by DEVELOPER of its development obligation under this Agreement;

7. That the OWNER agrees to partition to the DEVELOPER fifty-five percent (55%) of the net saleable area, while the other forty-five (45%) shall constitute the share of the OWNER in accordance with a segregation and division of titles as return of their respective investments in the project. The parties shall mutually agree in the selling price of the lot per square meter. However, the parties may review the selling price on a quarterly basis or whenever necessary, during and after the development of the project. The partition of the subdivision into lots among the DEVELOPER and the ONWER, shall be shaded in identifying colors by lots in the approved development plan;

8. Should the project be covered by Section 18 of RA 7279 (Socialized Housing), and the OWNER desires to avail of the same, it shall provide for an alternative area where the compliance for socialized project could be met, and the DEVELOPER shall then develop the area, with the same sharing scheme of 55%-45%. Even if it were not so, still the OWNER agrees for the allocation of a socialized housing site within the subject property under the same sharing arrangement of 55%-45%.

9. All roads and open spaces shall be co-owned by the parties prior to their turn-over to the local government unit (LGU) or Homeowners Association. However, its maintenance and upkeep shall be for the account of the DEVELOPER prior to their turn-over to the concerned LGU or Homeowners Association. All real estate taxes pertaining to the said roads and open spaces shall be paid in accordance with the sharing agreement (55%-45%) during the period of co-ownership. The parties, their agents and assigns, shall have the perpetual rights to the use of the roads free of charge; however, when the same are utilized for ingress/egress to/from the adjacent properties or servient estates, the conditions for the use of the roads shall be subject of a separate agreement between the parties. With respect to the use of water system/water and electrical connection, the same shall only be allowed upon proper payment of the usual charges/fees;

10. That upon approval of the subdivision plan by the Bureau of Lands, the OWNER shall execute a Deed of Assignment in favor of the DEVELOPER, and the individual owner and their respective assignees so that titles covering the shares of the DEVELOPER and individual owner shall already be registered in their names. Once segregated, the DEVELOPER shall simultaneously execute a Deed of Conveyance of its share in favor of the OWNER, for those unearned lots to be determined by the OWNER (not covered by its accomplishment at the time of the segregation of the titles), but such Deed of Conveyance shall not be registered but shall only be for safekeeping to guarantee the compliance of the DEVELOPER of its obligations as herein indicated. The same Deed of Conveyance shall be used and registered by the OWNER, in case of termination of this Agreement;

Upon approval of the subdivision plans by the Land Management Bureau and prior to segregation, the parties agree to allocate and distribute amongst themselves and their assignees the resultant saleable lots corresponding to their percentage interest in the project. The parties may reserve certain lots for themselves and not to be marketed through the chosen marketing firm/entity. The proceeds of lot sales shall be remitted immediately to the parties. The creditable withholding tax (CWT) or capital gains tax, shall be for the account of the selling party, while the documentary stamp tax, VAT if any, and registration expenses and transfer fees, shall be for the account of the buyer;

11. That the DEVELOPER shall be solely liable and responsible to the government agencies concerned, lot buyers and/or third parties for the conduct of the development project and for whatever violations of rules or standards related to the development of the proposed subdivision pending formal transfer to the proper government agencies or Homeowners Association of road lots, open spaces and common facilities;

12. That upon issuance of a License to Sell by HLURB, the parties may immediately start selling the subdivided lots based on the price and terms/conditions agreed upon by the parties;

13. The OWNER and the DEVELOPER shall agree on the identification and distribution of lot shares more or less consistent with agreed sharing ratio. The titles are to be held in custody by the Bank of Commerce and/or Philippine Veterans Bank, the appointed escrow bank, and shall be released to the buyers only upon Joint Approval and Signature of the representatives of the DEVELOPER and the OWNER. Further, the said titles shall in no way be mortgaged;

Upon release of the individual titles of the subdivision lots, the same together with the Deed of Conveyance, shall be placed in the custody of Bank of Commerce and/or Philippine Veterans Bank. Withdrawals of such titles shall be made only for the disposal of the loots [sic] to direct buyers and for no other purpose and shall be done by way of the joint signatures of the duly designated representatives of the DEVELOPER and the OWNER. However, with respect to those titles which are identified before hand by the parties, as reserved, and not included in the sale, the same shall forthwith be released to the parties concerned (subject to the provisions of paragraph No. 10 hereof pertaining to the execution of Deed of Conveyance);

14. All taxes and expenses for the transfer of titles in favor of the OWNER and/or DEVELOPER or their assignees, shall be for their respective exclusive account. Expenses for the segregation of individual titles from the original title ad issuance of corresponding tax declarations shall be for the account of the DEVELOPER. Upon execution of this Agreement, the real estate taxes shall be shared on a 55%-45% basis by the DEVELOPER and the OWNER, respectively. Once segregated, real estate taxes shall be shouldered by the respective owners, while real estate taxes on road lot and open spaces shall be shared by the parties on a 55%-45% basis prior to the turn-over to LGU or the Homeowners Association;

15. That this Agreement shall be annotated in the Transfer Certificates of Title of the above-mentioned parcels of land at the expense of the DEVELOPER after the issuance of the Development permit and such annotation shall be cancelled by the Register of Deeds upon written notice jointly signed by both parties or their duly authorized representatives that the said title/lot has already been sold, transferred or assigned to a third party, or upon completion of the project. In case of termination/cancellation of this Agreement, the annotation shall be cancelled by the Register of Deeds by mere notice of the OWNER only;

16. The DEVELOPER shall construct, based on model units, a housing component, when requested by the buyer, for lots purchased. The share of the OWNER shall be ten percent (10%) based on the gross selling price for the housing unit;

17. The concerned parties, DEVELOPER and OWNER, shall be the individual signatories of their corresponding lots, in contracts to sell, whether for lots only or for a house and lot package, for their shares of lots under the 55%-45% sharing agreement;

18. That both parties shall have uniform sales or marketing policies, including prices of lots and terms and conditions of sales contract, including all restriction to be annotated on each lot. The OWNER and the DEVELOPER shall appoint a marketing organization to market and sell the saleable lots and/or house and lot packages to qualified buyers at a marketing fee of 10% for AUP regular buyers and 15% for non-AUP buyers. The appointed marketing group will be allowed to appoint sub-agencies and/or capable members of the Adventist community to be sub-agents subject to the approval of the OWNER. In addition, selling of lots and/or house and lot package shall be opened only to members of the Seventh-day Adventist Church and AUP Alumni for Phase1-A and Phase 1-B, for the first two (2) years while the rest shall be opened to the public. The DEVELOPER as a marketing support, among others, shall construct at least five (5) prototypes of model house within the proposed subdivision. The model houses can later be sold to interested buyers. The marketing arrangement amongst the OWNER and the DEVELOPER and the appointed marketing organization shall be covered by a separate agreement supplemented to this contract;

19. That AUP regular workers and its board members, the legal counsel, and the project negotiator are entitled for a 50% discount on one saleable lot, whether allocated to the OWNER or the DEVELOPER;

20. That in the event either party fails to comply with the terms and conditions aforestated, the aggrieved party shall be entitled to all forms of damages and attorney’s fee plus cost of suit or litigation;

In the event of disputes, conflicts or controversies, by the parties in the implementation of the project and/or enforcement of this Agreement,, the parties agree to exert their best effort to arrive at an amicable settlement with the end in view of accomplishing the intent and purposes of this Agreement and obtaining terms mutually beneficial to all parties concerned. For this purpose, the parties agree to submit to arbitration of their disputes or conflicts pursuant to procedures outlined in RA 9283 or known as “Alternative Dispute Resolution Act of 2004” and/or its implementing rules and regulations;

21. That the OWNER be given a cash advance by the DEVELOPER of ten million pesos (P10,000,000.00). An amount of two million pesos (P2,000,000) shall be released by the DEVELOPED to the OWNER upon signing this Agreement; another three million pesos (P3,000,000) after securing all government permits; and five million (P5,000,000) immediately after the procurement of the HULRD License to Sell;

22. Through the assistance of the DEVELOPER, the SDA church members shall be pre-qualified by the Home Development Mutual Fund (HDMF) or Pagibig Fund, in order that said purchases will be coursed through the Pagibig Loan Program, thereby paying off the obligations incurred by the DEVELOPER from its funding bank;

23. That no terms, conditions, or stipulations in this agreement shall be deemed modified or novated, unless it appears in writing and signed by both parties;

24. During the effectivity of this Agreement, the parties shall not be allowed to mortgage the properties as a collateral/security for any loan or credit accommodation that they may obtain from any banking/lending institution or other person/entity to fund or finance the project or for any other purpose whatsoever;

25. That each of the parties herein warrant that their respective participation in this Agreement thru their authorized representative and/or signatory is duly backed up by a corresponding Board resolution to give effect to this Agreement;

26. In every contract or agreement made by the DEVELOPER, reference shall be made to this instrument, and any obligation of the DEVELOPER under or by virtue of this Agreement shall not in any way, be adversely affected by the DEVELOPER’s representations or obligations to third parties;

27. The parties agree to do or cause to be done such acts and execute or cause to be executed any such additional contracts, agreements or document necessary or convenient to give full force to this Joint Venture Agreement;

28. There shall be a Joint Project Management Committee (JPMC) composed of up to four (4) representatives of the OWNER and up to three representatives of the DEVELOPER with Dr. Tomas Alonzo Meneses Jr., as consultant and Dr. Querubin Padilla as Chairman of the committee. The JPMC shall meet twice a month to monitor development including assessment of progress reports, financial and operational matters, and to address any need of the Project. It shall also act as liaison between the OWNER and the DEVELOPER;

29. The Parties agree that the workers, laborers, employees, agents, staff and other personnel, whether regular, contractual or piecework basis, who are employed by the DEVELOPER in the project, shall be the sole responsibility of the DEVELOPER, and that no employer-employee relationship shall ever be construed as being established, expressed or implied by and between the OWNER and the said workers, laborers, employees, agents, staff and other personnel;

The DEVELOPER as an independent contractor defined by law, warrants and undertakes to comply with all labor laws pertaining to wages ad benefits due to the workers of the project. The DEVELOPER further undertakes to submit to the OWNER upon completion of the project, an affidavit that the above obligations due to workers or employees hired for the project and/or claim of suppliers or contractors in the project, have been settled in full by the DEVELOPER;

30. The DEVELOPER shall hold the OWNER and all its officers, agents and representatives free and harmless from any liability whatsoever, including but not limited to the claims of workers//employees, suppliers of equipment and materials and claims for death, injury, and damage to property from third persons or entities in connection with the implementation of the project and the enforcement of this Agreement, as well as for violation of the laws and of rules and regulations governing the development of the project;

31. The OWNER has the right to rescind, terminate or cancel this Agreement without need of judicial action in case of default by the DEVELOPER as stipulated hereunder and when the DEVELOPER fails to remedy or cure such defects to the satisfaction of the OWNER within the period stated hereunder—

a. Failure to complete the project within the time frame as stated herein, and despite the lapse of an extension given which shall not be more than six (6) months from the expiration of the period to develop, except in cases of stoppage of work due to force majeure or fortuitous event.

b. Any material violation by the DEVELOPER of the provisions or conditions of this Agreement and other related Agreements.

In the event of default or negligence by the DEVELOPER, the OWNER, may, by written notice to the DEVELOPER, cancel this JVA, in which event, the DEVELOPER shall forfeit its remaining interest or unbilled interest in the project, and shall be further liable to pay the OWER [sic] such amount of damages as maybe proven. It is understood that all unbilled titles or interest shall be released and forfeited in favor of the OWNER. However, if the cancellation or termination is not imputable to the fault or negligence of the DEVELOPER, the OWNER shall pay and settle within thirty (30) working days upon billing, whatever work, improvement and/or development that DEVELOPER has instituted or done on the project.

32. The DEVELOPER agrees to advance any and all expenses that may be due from the OWNER as their share of expenses in the project as elsewhere agreed upon in this contract, including the cash advance stated in No. 20 and that said cash advance shall be paid back to the DEVELOPER out of the first proceeds of the sale of the lots allocated to the OWNER;

33. The following restrictions must be observed by the project workers and enforced by the DEVELOPER:

A. No construction work whatsoever, including marketing efforts shall be conducted within the AUP Compound during Sabbath. Sabbath starts at sundown of Friday and ends at sundown of Saturday.

B. No smoking or drinking alcoholic beverages shall be allowed to workers within the AUP compound. All kinds of forbidden drugs, depressants or uppers, marijuana, cocaine, shabu and any other drug prohibited by the Dangerous Drugs Board are absolutely prohibited within the AUP premises.

C. Food served by the concessionaire canteen serving construction workers should not contain pork, dishes made blood of any animal such as dinuguan, or dishes from any marine scavengers such as crustaceans or crabs, lobsters, shrimps, all kinds of shellfish, and all kinds of fish without scales such as kanduli, hito, and eel.

D. Since construction work will be done in the premises of a University and a Religious Institution, boisterous and rowdy behavior and the use of expletives and indecent language is not permitted.

E. Most of all, and again, since construction work will be done in the premises of a Religious Institution and a University, except for authorized security guards, brining in of deadly weapons such as knives and firearms will not only be considered a major violation of the JVA but shall be reported to police authorities as a crime committed.

F. All units, house and lot package available to AUP employees, faculty members and members of the Adventist Community as well as the public shall have clearance from the Office of the Project Director. All house and lot units sold to Adventist buyers cannot be sold to non-members of the AUP faculty and staff and non-Adventist community. The lots sold at a subsidized price should not be sold to non-faculty members who are not entitled for subsidy. This restriction shall be annotated in the subdivision titles to be issued.

G. All construction workers shall be issued identification cards and shall wear colored-coded T-shirts and shall remain only in the construction area and shall not wander around the campus when their job for the day is done. They should leave the campus premises by 5:00 p.m. and are to return to their place of work at 8:00a.m of the following day. The DEVELOPER can, however, assign at least 3 site-keepers who can stay overnight in the Project Area. These site-keepers should follow all rules, policies and restrictions of AUP. The OWNER reserves the right to send its security personnel, accompanied by the Project Coordinator to do random and periodic checks on the Project Area to see to it that rules and policies and restrictions are followed.

H. All construction workers shall undergo drug tests at the AUP clinic.

I. No students and outsiders are allowed within the construction perimeter area.

IN WITNESS WHEREOF, the parties have hereunto set their hands on the date and at the place first above-written.


WILPER CONSTRUCTION, INC.
DEVELOPER
by:
ENGR. WILFRIDO CASTOR
President

ADVENTIST UNIVERSITY OF THE PHILIPPINES
OWNER
by:
DR. GLADDEN O. FLORES
President


SIGNED IN THE PRESENCE OF:

Mr. Romero A. Daquila
Treasurer, NPUC

Pastor Abner S. Roque
President, NPUC

ACKNOWLEDGED BY SUMAGAYSAY OBIAL & ASSOCIATES

January 13, 2010
Doc No. 451
Page No. 91
Book No. XXXI
Series of 2009