Imposition of the CUSA Fee

SUBle BAY............... ....-..

SUBle BAY METROPOLITAN AUTHORITYOffice of theSENIOR DEPUTY ADMINISTRATOR FOR SUPPORT SERVICESRm. 109, Bldg. 229, Waterfront Rd., Subic Bay Freeport Zone, Philippines 2222Tel (6347) 252-4885 Fax (6347) 252-4040

24 August 2012

All Locators and Residentsof the Subic Bay Freeport Zone

Re: Imposition of theCommon Use Service Area Fee (CUSA)

Dear Locator / Resident,

Taking into consideration the comments and observations raised during the various publichearings and focused-group discussions held on the CUSA, please be notified that the SBMABoard of Directors resolved to revise the CUSA Rates, as follows:

For Locators:

a. A monthly Peso rate per square meter of leased land based on 2% of the AppraisedValue, but not to exceed 20% of the Actual Monthly Rent.

A table of Appraised Values is attached as Annex "A".

1. In the case of locators with lease contracts based on a fixed rent plus agross revenue share, the Actual Monthly Rent will be based on the sum ofthe monthly fixed rent and the average monthly revenue share.

2. In the case of locators with lease contracts based purely on a grossrevenue share, the Actual Monthly Rent will be based on the averagemonthly revenue share or the minimum monthly revenue share,whichever is higher.

3. In the case of locators who paid their lease on a lump sum basis, theActual Monthly Rent will be based on a monthly rate derived from thefuture value of their lump sum payment computed using a given yield.

The formula to compute this monthly rate is attached as Annex "B".

b. No discounts shall be given regardless of the size of the Leased Area, except forPower and Water Utilities which shall be given a 100% discount.

For Residents:

a. A monthly rate of Php1 ,200.00 per housing unit, inclusive of garbage fees.

Other than the above, all the other terms and conditions of the CUSA remain unchanged withthose that were presented during the public hearings. The costs of administration of municipalservices, 24-hour Emergency Medical Assistance, Road Maintenance and FacilitiesManagement as well as the provision for the new Tipo Road Street Lights shall continue to beborne in full by the SBMA.

Manner of Imposition

The CUSA will be billed together with the rental and will be included in your rental bill. TheCUSA will be imposed only on SBMA's direct lessees who shall have full and primaryresponsibility for payment. SBMA's direct lessees have the option of passing on the CUSA totheir sub-lessees. The CUSA will be based on land area, not floor area.

Penalties for Non-Payment

1st Offense - 10% surcharge + 12% interest per annum

2nd Offense - 20% surcharge + 12% interest + suspensionof Permit to Operate for locators, non-collection of garbagefor residents.

3rd Offense - 25% surcharge + 12% interest + cancellationof Certificate of Registration and Tax Exemption, Certificate ofRegistration or Residential Lease Agreement

Publication and Effectivity

The CUSA shall be published once a week for two consecutive weeks in a newspaper ofnational circulation and shall be imposed upon the lapse of 15 days from the last publicationdate.

We trust in the civic mindedness and spirit of cooperation of our locators and residents to helpshoulder the cost of law enforcement, fire fighting, street cleaning and street lighting in order to,at the minimum, sustain the quality of these services and in the immediate future, look intofurther improving them, all for the betterment of the Subic Bay Freeport Zone.

Best regards.

Yours sincerely,

Cc: Chairman & AdministratorChief Operating OfficerSubic Bay Freeport Chamber of Commerce

2

A B ( D E F G I H I

Appraised(USA Rate

Locator LSRate /SQ Term (Yrs) FV of [email protected]%pa MO. Rate/SQM Value TOTAL AREA

PerSQM 2% Appraised 120% of MO. Base

PROJECTED CUSA

J K

2% Appraised Value 20% of MO.of Lot Base Rent

Locator A $ 100.00 50.00 $204.19 $0.34 $ 2.56 $ 0.05 $0.06806 lO,(XX).oo $ 511.67 $ 680.63

For locators under lumpsum Contracts, their CUSAwill be based on the lower of two (2) Options:

OPTION 1: 2% OF THE CURRENT APPRAISED VALUE OF LOT

(Column J) $511.67 is 2% of the Appraised Value of the Lot = (Column G) $0.05 X (Column I) 10,OOOsq.m.(Column G) $0.05 is 2% of the Appraised Value (Column F)(Column F) $2.56 is theCurrent Appraised Value given by LAMD (see below chart) Subic Gateway, Php 107.45/ Forex = US$l=Php 42(Column I) 10,OOOsq.m.is the Total Area Leased by the Locator

Current Appraisal per District

LOCAIDNAPPRAISAL PER SO.M/MOI APPRAISAL PER SO.M/MOI

2% OF THE APPRAISEDin Alp in US$

BINICTICAN 48.91 1.16 0.0233CENTRAL BUSINESS DISTRICT 162.48 3.87 0.0774

CUBI TRIBOA DISTRICT 50.66 1.21 0.0241ILANIN FOREST EAST 37.56 0.89 0.0179ILANIN FOREST WEST 37.56 0.89 0.0179

KALAYAAN 48.91 1.16 0.0233SUBIC GATE-WAY DISTRICT 107.45 2.56 0.0512

SUBIC PORT DISTRICT 113.56 2.70 0.0541

A B ( D E F G I H I

Appraised(USA Rate

Locator LSRate /SQ Term (Yrs) FV of [email protected]%pa MO. Rate/SQM Value TOTAL AREA

PerSQM 2% Appraised 120%of MO. Base

PROJECTED(USA

J K

2% Appraised Value 20% of MO.

of Lot Base Rent

Locator A $ 100.00 50.00 $204.19 $0.34 $ 2.56 $ 0.05 $0.06806 10,000.00 $ 511.67 $ 680.63

OPTION 2: 20010 OF THE MONTHLY BASERENT

(Column K) $680.63, is the 20%of the monthly Base Rent = (Column H) $0.06806X (Column I) 10,OOOsq.m.(Column H) $0.06806 is 20% of the Monthly Rate (Column E)(Column E)$0.34 = Column 0204.19/ (Column C) SOyrs/12 months(Column 0) $204.19 is the Future Value of( Column B) $100.00 using a given yield.In this given, a yield of 1.06 (L1BaR Rate Sources: British Bankers/Association, Bankrate.com ) + 0.378 spread (Land Bank Rate) = 1.438%(Column B) $100.00 is the sample per sqm. Lumpsum Rate of the Locator

(USA FEEPAYABLE:

In this example, OPTION 2 is 33% Higher compared to OPTION 1Locator A, will pay a monthly CUSAFee amounting to (Column J)$511.67 or Php 24,490.00 @ US$1=Php 42.00

13/08/2012 11:13 0472524715 PAGE 01

.1~~JBusinessand Investment Group

LAND ASSET MANAGEMENT DEPARTMENTBldg. 156. Quezon 51.. cor. Sampson Rd., Subic Boy Freeporl Zone, Philippines 2222Tel (6347) 252-4\ 47/4148/4409/4529 Fax (63471 252-4780 website: www.sbma.com

UPDATED APPRAISAL RATES

~TEMAPPRAISED RATE (peso/sq.lmo.) ",

LOCATIONFIRST SECOND THIRD FOURTHSTRIP STRIP STRIP StRIP

1 8inictican Heights 48.913 44.022 39.620 35.658District

--.- ..

i2 Central Business 162.481 146.233 none none

Districtf--- ..-

Cubi-Triboa District 50.662 45.596.- None3 none

1--, -4 Ilanin Forest East 37.556 33.800 30.420 30.116District

5 lIanin Forest West 37.558 33.800 30.420 30.116District

6 Kalayaan Heights 48.913 44.022 39.620 35.658District

7 Redondo Peninsula 5.2481

•.4.723 4.251 3.826

District

8 Subia Gateway Distrid 107.44t-96.701-.

87.031 none1---. --,. ..•.

none9 Subic Port District 113.555 I none none

~ 10 TipoAre.

I

2.424 2.182 1.96 1.7641

11 Mt. Sta. Rita Area 1.45 1.305 1.175 1.0575L_..-L. .~ ...•-