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EXHIBIT 10.6
THIS LEASE made this _______ day of February, 1995.
BETWEEN:
ALCONE HOLDINGS LTD.
a company Incorporated under the laws of the Province of
Ontario, hereinafter called the "Landlord" of the FIRST PART.
- AND -
THORNHILL BAKERY LIMITED
a company Incorporated under the laws of the Province of
Ontario, hereinafter called the "Tenant" of the SECOND PART.
WHEREAS the Landlord is the owner of a property and building thereon
located at the municipal address of 350 Creditstone Road, City of Vaughan in the
Province of Ontario (hereinafter referred to inclusively as the "Building") and
certain premises thereof being Unit #D, consisting of ground floor office and
plant area representing approximately thirty-four thousand (34,000) square feet
as set out in red on Schedule "A" being a plan of the first floor of the
Building (hereinafter said Unit being referred to as "Unit D", and said Unit D
along with additional premises which the Tenant may lease hereunder being
referred to as the "Premises");
NOW THEREFORE WITNESSETH that in consideration of the promises and
mutual covenants and agreements herein contained the parties hereto agree as
follows:
SECTION 1.00 - LEASE OF PREMISES
1.01 DEMISE - NOW THEREFORE THIS AGREEMENT WITNESSETH that in consideration of
the rents reserved hereunder and the terms, covenants, obligations and
stipulations, conditions and agreements contained herein, the Landlord hereby
leases the Premises to the Tenant and the Tenant hereby leases the Premises from
the Landlord (hereinafter referred to as the "Lease").
1.02 TERM - The Tenant shall have and hold the Premises for and during a term of
ten (10) years commencing on the 1st day of March, 1995, (hereinafter called the
Commencement Date) and thenceforth next ensuing and to be fully completed and
ended on the 28th day of February, 2005, as may be extended by and subject to
any rights of renewal hereunder (hereinafter referred to as the "Term").
1.03 OPTION TO RENEW - The Tenant shall have the option to renew the Lease for
two (2) further periods of five (5) years at a rental rate to be negotiated at
then market value for premises of similar size, usage and nature, provided that
the Tenant gives notice to the Landlord, in writing, of ifs desire to exercise
the said option at least six (6) months prior to the end of the Term. In the
event that an agreement is not reached as aforesaid, the rental rate shall be
set by arbitration in accordance with the Arbitration Act of Ontario, which
determination shall be binding on both parties. The arbitration committee shall
consist of three (3) arbitrators, with one (1) each to be appointed by the
Landlord and the Tenant, and the third to be agreed upon by both arbitrators.
There shall be no further right of renewal.
1.04 ACCESS PRIOR TO COMMENCEMENT DATE - The Tenant shall be entitled to access
to Premises from the 15th of January, 1995 (hereafter referred to as the
"Occupancy Date"), provided Premises is demised and available for occupancy, and
with occupancy prior to the Commencement Date to be rent free. Should the Tenant
require possession eerier than the Occupancy Date, the parties agree that the
Commencement Date may be adjusted to an earlier date.
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1.05 PRO-RATED RENT - The Tenant shall pay all rent due hereunder calculated on
a per diem basis, from the Commencement date, determined in accordance with the
foregoing and following, if the Commencement Date is not the first day of a
month to the first day of the month next following, on the Commencement Date.
1.06 RIGHT OF FIRST REFUSAL - The Tenant shall have a right of first refusal to
lease additional space to the west of Unit D in the amount of twenty-three
thousand (23,000) square feet. If and when such space becomes available the
Tenant shall have the right to acquire same at the fair market rent of similar
space at the time it becomes available. The term applicable to such space shall
coincide with the balance of the Term left on the lease of Unit D and shall
contain the same options of renewal as contained In that lease. If the said
additional space does not become available within four and a half years of the
start of the lease of Unit D, then the Tenant shall have an option exercisable
within the first five (5) years of the term of the lease of Unit D, to lease
alternative adjacent premises to the immediate east of Unit D, consisting of
approximately eleven thousand (11,000) square feet exclusive of office and
showroom space (hereinafter referred to as the "Eastern Space"), exercisable by
notice in writing from the Tenant no later than six (6) months prior to the end
of the five (5) year option period. The lease of the Eastern Space would be at
the fair market rent of similar space at the time of exercise of such option and
would be for a five (5) year term to coincide with the balance of the term of
the premises (Unit D) and shall contain a right of further renewal for two (2)
more five year terms exercisable in tandem with the option to renew on the
premises (Unit D) and upon the same rental terms as established in Section 1.03
herein. In the event that the Landlord does not or cannot grant to the Tenant a
lease to the Eastern Space in accordance with this option, then the Tenant shall
be permitted, at its option, to terminate its lease of Unit D at any time,
provided the Tenant gives at least six (6) months' advance written notice of
such termination.
SECTION 2.00 - RENT
2.01 BASE RENT - From and after the Commencement Date the Tenant shall pay to
the Landlord in lawful money of Canada, without deduction, abatement or set-off
whatsoever, an annual net rent (hereafter referred to as the "Base Rent") as
follows,
(a) From March 1st, 1995 to February 28th, 1996, the annual net
rental shall be the sum of two dollars and seventy-five cents
($2.75) per square foot per annum, being determined as
ninety-three thousand five hundred dollars ($93,500.00),
payable in equal monthly instalments of seven thousand seven
hundred and ninety-one dollars and sixty-six cents
($7,791.68), plus G.S.T.;
(b) From March 1st, 1996 to February 29th, 1997, the annual net
rental shall be the sum of three dollars ($3.00) per square
foot per annum, being determined as one hundred and two
thousand dollars ($102,000.00), payable in equal monthly
instalments of eight thousand five hundred dollars
($8,500.00), plus G.S.T.;
(c) From March lst, 1997 to February 28th, 1998, the annual net
rental shall be the sum of three dollars and twenty-five cents
($3.25) per square foot per annum, being determined as one
hundred and ten thousand five hundred dollars ($110,500.00),
payable in equal monthly instalments of nine thousand two
hundred and eight dollars and thirty-three cents ($9,208.33),
plus G.S.T.;
(d) From March 1st, 1998 to February 28th, 1999, the annual net
rental shall be the sum of three dollars and seventy-five
cents ($3.75) per square foot per annum, being determined as
one hundred and twenty-seven thousand five hundred dollars
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($127,500.00). payable in equal monthly instalments of ten
thousand six hundred and twenty-five dollars ($10,625.00),
plus G.S.T.;
(e) From March 1st, 1999 to February 29th, 2000, the annual net
rental shall be the sum of four dollars ($4.00) per square
foot per annum, being determined as one hundred and thirty-six
thousand dollars ($136,000.00), payable in equal monthly
instalments of eleven thousand three hundred and thirty-three
dollars and thirty-three cents ($11,333.33), plus G.S.T.;
(f) From March 1st, 2000 to February 28th. 2001, the annual net
rental shall be the sum of four dollars and fifty cents
($4.50) per square foot per annum, being determined as one
hundred and fifty-three thousand dollars ($153,000.00),
payable in equal monthly instalments of twelve thousand seven
hundred and fifty dollars ($12,750.00), plus G.S.T.;
(g) From March 1st, 2001 to February 28th, 2002, the annual net
rental shall be the sum of four dollars and fifty cents
($4.50) per square foot per annum, being determined as one
hundred and fifty-three thousand dollars ($153,000.00),
payable in equal monthly instalments of twelve thousand seven
hundred and fifty dollars ($12,750.00), plus G.S.T.;
(h) From March 1st, 2002 to February 28th, 2003, the annual net
rental shall be the sum of four dollars and fifty cents
($4.50) per square foot per annum, being determined as one
hundred and fifty-three thousand dollars ($153,000.00),
payable in equal monthly instalments of twelve thousand seven
hundred and fifty dollars ($12,750.00), plus G.S.T.;
(i) From March 1st, 2003 to February 29th, 2004, the annual net
rental shall be the sum of four dollars and fifty cents
($4.50) per square toot per annum, being determined as one
hundred and fifty-three thousand dollars ($153,000.00),
payable in equal monthly instalments of twelve thousand seven
hundred and fifty dollars ($12,750.00), plus G.S.T.;
(j) From March 1st, 2004 to February 28th, 2005, the annual net
rental shall be the sum of four dollars and fifty cents
($4.50) per square foot per annum, being determined as one
hundred and fifty-three thousand dollars ($153,000.00),
payable in equal monthly instalments of twelve thousand seven
hundred and fifty dollars ($12,750.00), plus G.S.T.
2.02 ADDITIONAL RENT - Tenant acknowledges that this is a net lease carefree of
all expenses to the Landlord, and the Tenant therefore covenants to be
responsible and pay for, and of which sums the Landlord shall be entitled to
charge to the Tenant, a monthly fee which shall Include the following:
(i) water and sewer charges (unless separately metered); all real
estate taxes; outside maintenance including driveways,
trucking and parking areas; lawn and shrubbery maintenance;
snow removal and fire insurance premiums; and any other
expenses of whatever nature traceable to the Tenant's use
and/or occupation of the Premises including but not limited to
any and all utility charges (hydro and gas), telephone
charges, business taxes, local improvement charges, and
heating, ventilation and air conditioning, to the extent such
are not separately metered and/or assessed; and,
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(ii) a reasonable apportionment of expenses incurred in managing,
maintaining and insuring the Building and for structural and
common area maintenance thereof, along with the Landlord's
administration charge of fifteen percent (15%) of all such
expenses;
as apportioned to the Tenant according to the proportion the square footage of
the Premises bears to the square footage of the Building, all of which sums
(hereafter referred to as "Additional Rent") including G.S.T. thereon shall be
estimated by the Landlord for each year of the Term with notice thereof to be
provided to the Tenant by 31st of December of the preceding year of the Term
(except for the first year) and one-twelfth (1/12) of such estimate shall be
payable by the Tenant as Additional Rent every month during a year of the Term;
the Landlord shall reconcile the actual expenses compared to such estimated
expenses by the 31st of March of the year following a year of the Term, shall
provide such reconciliation to the Tenant, and shall either demand from the
Tenant any underpayment which shall be payable immediately upon notice thereof
or return to the Tenant any overpayment; and the Landlord, in addition to any
other rights, shall have the same remedies and may take the same steps for the
recovery of such sums as rent in arrears under the terms of this Lease. For the
first year of the Term the estimated annual Additional Rent shall be the sum of
sixty-six thousand and three hundred dollars ($68,300.00) being a monthly
payment of five thousand two hundred and twenty-five dollars ($5,525.00), plus
G.S.T., where the Landlord warrants and represents that for the first year of
the Term such Additional Rent shall not exceed the aforementioned estimate and
such Additional Rent shall be adjusted once the Tenant receives its own water
meter.
2.03 PREPAID RENT - it is acknowledged that the Tenant has paid the sum of
thirty-three thousand eight hundred and three dollars and eight cents
($33,803.08) to be applied towards payment of the first and last month's Base
Rent and Additional Rent for the Term herein, (where Additional Rent for the
last month of the Term has been estimated as five thousand five hundred and
twenty-five dollars ($5,525.00), plus G.S.T), including G.S.T. on such sums.
Last month Feb. 2005 $16,901.54
2.04 PAYMENT DATE - The Tenant is to pay Base Rent and Additional Rent on the
first day of each month during the Term.
2.05 POST DATED PAYMENTS - The Tenant is to provide in advance twelve (12)
post-dated cheques for every month for Base Rent and Additional Rent for a year
of the Term no later than March 1st of every year of the Term.
2.06 RENT FREE PERIODS - Notwithstanding the aforementioned, the Landlord agrees
to provide to the Tenant four (4) months during which Base Rent is not payable,
being the months of March, April, May and June of 1995, provided during such
period the Tenant shall remain responsible for Additional Rent, notification of
all proper authorities as to utility hookup and payment for utility charges as
separately metered, business taxes, and ail other responsibilities hereunder
this Lease.
2.07 FITTINGS, FIXTURES & PARTITIONS - Subject to the terms of this Lease and to
the written approval of the Landlord, which approval shall not be arbitrarily
withheld, the Tenant may, at its own expense, install any fittings, fixtures and
partitions that may be necessary for the operation of its business, from time to
time during the Term. Upon the date of this Lease the Landlord hereby approves
of the Tenant's installation of fittings, fixtures and partitions, installed to
date subject to inspection thereof by the Landlord's expert to determine
compliance of the Tenant's installations with applicable laws, rules and
regulations governing same, for which any non-compliance the Tenant shall bear
the cost of required rectification.
SECTION 3.00 - TENANT'S COVENANTS
3.01 COVENANT FOR RENT - The Tenant covenants to pay Base Rent and Additional
Rent as rent due under this Lease.
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3.02 TENANT TO PAY BUSINESS TAXES - The Tenant shall pay and discharge on or
before the due date when the same or the instalments for same become due all
business taxes levied on his business.
3.03 OBLIGATION TO REPAIR - The Tenant covenants with the Landlord that,
throughout the Term, the Tenant shall maintain and repair the interior of the
Premises and keep all fixtures and equipment therein in good order and same
state of repair as at the commencement of the Lease, reasonable wear and tear,
damage by fire, lightning and tempest only excepted.
3.04 COMPLIANCE WITH STATUTES, ETC. - The Tenant shall comply promptly with the
requirements of every applicable statute, law and ordinance, and with every
applicable lawful regulation and order with respect to the placement or removal
of any encroachment erected by Tenant or to the condition, equipment,
maintenance, use or occupation of the Premises and to comply with the applicable
regulation or order of the Canadian Underwrite's Association, or of any body
having similar functions, or of any liability or fire insurance company by which
the Tenant and/or Landlord may be responsible for the condition, operation,
maintenance and management of the Premises. It shall be the responsibility of
the Tenant to obtain all necessary municipal licenses and approvals of whatever
nature related to its use and occupancy of the Premises, including an occupancy
permit to carry on its business and operations in or on the Premises in
accordance with the use provided herein this Lease and as permitted by municipal
by-laws. It shall further be the responsibility of the Tenant to obtain any and
all necessary permits to carry on its business in or on the Premises, including
any permits, licenses or inspections as required by relevant authorities
governing such business or use. Provided that if a municipality makes a charge
against the Tenant or against the Premises by reason of the Tenant failing to
observe the requirements of any municipal or provincial by-law or regulation,
the Tenant shall pay such charge and if the Tenant fails to do so upon request,
the Landlord may pay the amount of such charge and recover the amount so paid in
the same manner as rent in arrears and with like powers or distress.
3.05 ENVIRONMENTAL COMPLIANCE -
For the purposes of this section, the following terms shall have the
following meanings respectively:
(i) "Contaminant" includes, but is not limited to, any pollutants,
dangerous substances, liquid waste, industrial waste, toxic
substances, hazardous wastes, hazardous materials, hazardous
substances or contaminants including any of the foregoing
defined in any Environmental Law having jurisdiction over the
Premises;
(ii) "Environmental Activity" means any activity, event or
circumstances in respect of a Contaminant, including, without
limitation, its storage, use, holding, collection, purchase,
accumulation, assessment, generation, manufacture,
construction, processing, treatments, stabilization,
disposition, handling or transportation, or its Release,
escape, leaching, dispersal or migration into the natural
environment, including the movement through or in the air,
soil, surface water or ground water;
(iii) "Environmental Laws" means any and all current and future
applicable international, federal, provincial or municipal
laws, by-laws, statutes, regulations, policies, guidelines,
orders or judgments, relating to the environment, or any
Environmental Activity as it relates to the Premises; and,
(iv) "Release" includes release, spill, pump, escape, leach,
dispose of, infuse, introduce, discharge, spray, Inject,
inoculate, abandon, deposit, spill, leak seep, pour, emit,
empty, throw, dump, place
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and exhaust, or similar.
In addition to any other provision herein this Lease, the Tenant
covenants, represents and warrants during the course of the Term that it shall
not permit the Release of any of the Contaminants into the environment or
municipal services as the result of any Environmental Activity conducted by the
Tenant or those persons for whom it is responsible in law, on the Premises or
Building, and that it shall comply with all Environmental Laws in effect from
time to time. The Tenant shall upon the Landlord's request provide a plan for
waste handling and disposal for dealing with the Contaminants and/or
Environmental Laws, or a contingency plan for dealing with Contaminant Release
should such occur. The Landlord may specify the location or locations in which
Contaminants are to be kept on the Premises.
The Tenant warrants and represents, that to the best of the Tenant's
knowledge after having made and continuing to make all due enquiries and
investigations respecting same, and as follows that:
(a) the Tenant and its respective processes and undertakings have been,
are and continue to be in strict compliance with all Environmental
Laws;
(b) the Tenant has received no notice of non compliance with,
requisition or order made under, the Environmental Laws and does not
know of or have reasonable grounds to know of any acts, matters or
things which would, or may, give rise to the aforementioned notice,
requisition or order being Issued in respect of any of the Tenant's
activities or proposed activities, businesses or operations;
(c) the Tenant has at no time been prosecuted to conviction for an
offence of non compliance with any Environmental Laws or settled any
such prosecution short of conviction; and,
(d) for the duration of the Lease to notify the Landlord immediately of
the nature and extent of any such Release if such should or could
possibly occur and to undertake any reasonably necessary remedial
action related thereto as the Landlord may direct.
The Tenant further covenants and agrees to indemnify and save harmless and
shall keep indemnified and continue to save harmless the Landlord from and
against any liability, actions, suits, damages (including lost profits,
consequential damages, interests, penalties, fines or monetary sanctions, and
all legal and expert fees related thereto), losses, costs and expenses incurred
or suffered by the Landlord by reason of or resulting from or in connection
with, or arising in any manner whatsoever out of the Release of the
Contaminants, breach of Environmental Laws, or breach of any warranty or
covenant or the inaccuracy of any representation of the Tenant contained or
referred to herein, if such Release of Contaminants or breach of Environmental
Laws has been caused by the Tenant or those persons for whom it is responsible
in law. This covenant shall remain in effect notwithstanding the expiry or
termination of this Lease.
3.06 RIGHT TO INSPECTION - The Tenant shall permit the Landlord and its
officers, agents, servants, employees and contractors upon reasonable notice and
during business hours and in the presence of a duly authorized representative of
the Tenant, during the Term to enter the Premises to inspect and examine the
condition thereof, or for the purpose of making any repairs or work in this
Lease required or permitted to be done, and:
(i) where upon notice in writing given by the Landlord to the
Tenant of any want of repair for which the Tenant is liable
under the terms hereof, the Tenant shall rectify and make good
any such defect in such manner as the Landlord shall direct
within a reasonable time from the delivery of the notice;
provided that if the Tenant shall not repair according to
notice in writing as herein provided, the
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Landlord may enter upon the Premises (without being liable for
any disturbance or damage so caused) and may do such repairs
and of which the cost thereof the Landlord shall be entitled
to charge to the Tenant who shall pay such forthwith on
demand; and the Landlord, in addition to any other rights,
shall have the same remedies and may take the same steps for
the recovery of such sums as rent in arrears under the terms
of this Lease; and,
(ii) where in the opinion of the Landlord there exists on the
Premises any condition, matter or thing which is reasonably
likely to lead to a breach of section 3.05 hereof the Landlord
and its agents may conduct such audits, investigations, tests
and surveys as it deems necessary to assess the nature and
extent of the breach or likely breach and the completion of
necessary remedial action therefor, that the Landlord at its
option may either cause the Tenant to undertake in accordance
with subsection 3.06(i) hereof or which the Landlord shall
undertake, and of which the cost thereof the Landlord shall be
entitled to charge to the Tenant who shall pay such forthwith
on demand; and the Landlord, in addition to any other rights,
shall have the same remedies and may take the same steps for
the recovery of such sums as rent in arrears under the terms
of this Lease. If no breach of s. 3.05 is so found the
Landlord shall bear the costs of such audits, investigations,
test, and surveys.
3.07 SURRENDER OF LEASED PREMISES - At the expiration or earlier termination of
the Term the Tenant shall peaceably surrender and yield up to the Landlord the
Premises, in a broom swept condition only reasonable wear and tear excepted,
shall remove any Contaminants and shall take all reasonably necessary remedial
action with regard to any Released Contaminants or for conformance to
Environmental Laws (where "Contaminant", "Release" and "Environmental Laws" are
as defined in clause 3.06) as required by the Landlord, and if so required by
the Landlord, the Premises shall be restored to their original condition in the
event of any alterations made thereto. Where any restorations are to be made to
the ceiling of the Premises such work shall be carried out by the Landlord at
the Tenant's expense.
3.08 REMOVAL OF TRADE FIXTURES - At any time within thirty (30) days prior to
the expiration of the Term the Tenant, if not in default under this Lease, may
and at the request of the Landlord shall, remove from the Premises at its cost
all its movable trade fixtures, furniture, equipment and Tenant's work (other
than rugs, carpeting, floor coverings and leaseholds attached in any way to the
Premises) not affixed to the Premises, provided that the Tenant surrenders the
Premises in substantially the same condition me at the Commencement Date and the
Tenant shall repair any damage to the Premises and the Building which may be
occasioned by such removal. On the expiration of the Term all such movable trade
fixtures, furniture, equipment and Tenant's work not so removed shall be deemed
to have become the property of the Landlord.
3.09 EXHIBIT LEASED PREMISES - Upon reasonable notice and during business hours
during the Term the Landlord may exhibit the Premises to prospective purchasers
or mortgagees of the Building and during the six (6) months prior to expiration
of the Term, the Landlord may exhibit the Premises to prospective lessees.
3.10 ASSIGNMENT AND SUBLETTING - The Tenant will not assign, set over, transfer,
sublet or sublease, hypothecate, encumber or in any way deal with or part with,
the whole or any part of the Term or Premises, without written consent first
being obtained from the Landlord, but such consent shall not be unreasonably or
arbitrarily withheld, or delayed provided, however, and it is made a condition
to the giving of such consent that:
(i) The Tenant shall deliver to the Landlord a written request to
such assignment, sublease, etc. together with a copy of the
proposed assignment or sublease and shall provide the Landlord
with such information as the Landlord may reasonably require
with respect
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to the business and financial responsibility and standing of
the proposed assignee or sub-lessee;
(ii) Any assignee or sub-lessee of this Lease shall agree in
writing to assume and perform all of the terms, covenants,
obligations and stipulations, conditions and agreements by
this Lease imposed upon the Tenant herein in the form to be
approved by the solicitor for the Landlord; and,
(iii) No assignments or sublease shall in any manner release the
Tenant from its covenants and obligations hereunder.
3.11 USE OF PREMISES - The Tenant shall occupy the Premises throughout the Term
solely for the purpose of conducting thereon the business of a bakery, and
packaging and distribution of products and services associated therewith.
3.12 INSURANCE - The Tenant shall take out and maintain at its sole cost and
expense and in the names of the Tenant and the Landlord (and the Landlord's
mortgagee, if required by the Landlord) as their respective interests may
appear, insurance coverage of not less than one million dollars ($1,000,000.00)
including without limiting the generality of the foregoing, contents insurance,
property damage insurance, third party liability Insurance, business
interruption insurance and legal liability insurance, or in such amount or
amounts as the Landlord may reasonably from time to time stipulate. The Tenant
shall deposit certificates of all such insurance coverages with the Landlord at
the Landlord's request.
3.13 INCREASE IN INSURANCE PREMIUMS - The Tenant shall pay to the Landlord
forthwith on demand thereof any amount by which the basic premium of insurance
paid by the Landlord is increased by reason of any particular use or occupation
by the Tenant of the Premises.
3.14 RE-ENTRY - It is hereby agreed that when:
(a) the Tenant shall be in default in the payment of any rent, for
a period of seven (7) days after having received notice of
default;
(b) the Tenant shall be in default of any of its terms, covenants,
obligations and stipulations, conditions and agreements under
this Lease (other than its covenant to pay rent) and such
default shall have continued for a period of ten (10)
consecutive days after notice by the Landlord to the Tenant
specifying with reasonable particularity the nature of such
default and requiring the same to be remedied, provided
further that if the Tenant is taking steps to remedy and
cannot complete within ten (10) days, such ten (10) day period
shall be extended as the Landlord reasonably determines to
permit the Tenant to remedy;
(c) any property of the Tenant has been sold under a valid writ of
execution, or the Tenant shall have made an assignment for the
benefit of creditors, or have had a receiving order made
against it under the Bankruptcy and Insolvency Act, R.S.C
1985, as amended, or becoming bankrupt or insolvent, or shall
have made application for relief under the provisions of any
statute now or hereafter in force concerning bankrupt or
insolvent debtors, or any action whatever, legislative or
otherwise, shall have been taken with a view to the winding
up, dissolution or liquidation of the Tenant;
(d) any insurance policy is cancelled or not renewed by an insurer
by reason of any particular use or occupation of the Premises,
or;
(e) the Premises shall have been vacated or have become vacant or
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shall have remained unoccupied for a period of fifteen (15)
consecutive days:
then and in any of such cases, the then current month's rent
together with the rent for the three (3) months ensuing shall immediately become
due and payable, and at the option of the Landlord the Term shall become
forfeited and void, and the Landlord without notice or any form of legal process
whatsoever may forthwith re-enter the Premises or any part thereof in the name
of the whole and repossess and enjoy the same as of its former estate, anything
contained in any statute or law to the contrary notwithstanding. Such forfeiture
shall be wholly without prejudice to the right of the Landlord to recover
arrears of rent and damages for any antecedent breach of the terms, covenants,
obligations and stipulations, conditions and agreements of the Tenant under this
Lease. Notwithstanding any such forfeiture the Landlord may subsequently recover
from the Tenant damages for loss of rent suffered by reason of this Lease having
been prematurely determined and it may recover from the Tenant all damages it
may incur with respect thereto including the cost of recovering the Premises.
3.15 LANDLORD ENTITLED TO RE-LET - If the Landlord does not exercise its option
under section 3.14 to terminate this Lease it may nevertheless in the events set
out in section 3.14 from time to time re-enter the Premises without terminating
this Lease and acting reasonably make such alterations and repairs as may be
necessary in order to re-let the Premises or any part thereof as agent for the
Tenant for such period or periods (which may extend beyond the term) and at such
rental or rentals and upon such other terms and conditions as the Landlord in
its sole discretion may deem advisable. Upon each re-letting rent shall be
applied, first, to the payment of any indebtedness other than rent due from the
Tenant to the Landlord; second, to the payment of any cost and expenses of such
re-letting, including brokerage fees and solicitor's fees and of the costs of
such alterations and repairs; third, to the payment of rent due and unpaid; and
the residue, if any, shall be held by the Landlord and applied in payment of
future rent as the same may become due and payable. The Tenant shall pay to the
Landlord the amount by which the rentals received from such re-letting during
any month are less than the rent payable during that month by the Tenant.
Notwithstanding any such re-letting without termination, the Landlord may at any
time thereafter elect to terminate this Lease. No such re-entry or taking of
possession by the Landlord shall be construed as an election on its part to
re-entry or taking of possession, unless a written notice of such intention has
been given to the Tenant or unless the termination thereof be decreed by a court
of competent jurisdiction.
3.16 DISTRESS - Notwithstanding anything contained in any statute or amendment
or revision thereof, none of the goods or chattels of the said Tenant at any
time during the continuance of the Term hereby created situate on the Premises
shall be exempt from levy by distress for rent in arrears, and that upon any
claim being made for such exemption by the Tenant or on distress being made by
the Landlord this covenant and agreement may be pleaded as an estoppel against
the Tenant in any action brought to test the right to the levying upon any such
goods as are named as exempt in any such statute, and the Tenant waives every
benefit that might have accrued to the Tenant under any such statute but for
this covenant.
3.17 LANDLORD MAY FOLLOW CHATTELS - In case of removal by the Tenant, except in
the ordinary course of business, of goods and chattels from the Premises, the
Landlord may follow same for a period of thirty (30) days in the same manner as
is provided for in the Landlord and Tenant Act, R.S.O. 1990, as amended, or in
any other act respecting the fraudulent and clandestine removal of goods.
3.18 REMOVAL OF REFUSE - Tenant is not to allow any refuse, garbage or other
loose or objectionable material to accumulate in, on or around the Premises and
is at all times to keep the Premises in clean and wholesome condition, failing
which the Landlord may do so at the Tenant's expense, and upon the termination
of the Term the Tenant is not to leave upon the Premises any rubbish or waste
material but to leave the Premises in a clean and tidy condition. To the extent
the Landlord shall have to undertake removal of refuse it shall be entitled to
charge the expenses thereof
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to the Tenant who shall pay them forthwith on demand; and the Landlord, in
addition to any other rights, shall have the same remedies and may take the same
steps for the recovery of such sums as rent in arrears under the terms of this
Lease. The Tenant is to provide a disposal bin for Tenant's refuse.
3.19 TENANT'S ALTERATIONS - The Tenant shall not make any alteration, repair or
improvement to the Premises nor make, construct, erect, or install any leasehold
improvements in or to the said Premises, except with the prior written approval
of the Landlord which approval not to be unreasonably withheld and in accordance
with the procedures and provisions set out in this section. Before beginning any
such work the Tenant shall deliver to the Landlord sufficient copies of its
plans and specifications thereof and such other information as the Landlord may
reasonably require with respect thereto. All such work shall be carried out by
the Tenant in accordance with the applicable requirements of all regulatory
authorities having jurisdiction with respect thereto and shall be carried out as
expeditiously as possible and in a good and workman like manner with first class
new materials. Such work shall comply with the reasonable rules and regulations
as may from time to time be made by the Landlord and shall not be of such kind
or extent as to in any manner weaken the structure of the Building or Premises,
or reduce the value thereof. The Tenant shall obtain all necessary permits for
Tenant's work, which includes any and all work carried out by the Tenant beyond
that done by the Landlord.
3.20 OVERLOADING PREMISES - The Tenant will not bring upon the Building or
Premises, or any part thereof any machinery, equipment, article or thing that by
reason of its weight or size might damage the Building or Premises and will not
at any time overload the floors of the Building or Premises and that if any
damage is caused to the Building or Premises by any machinery, equipment,
article or thing or by overloading or by any act, neglect or misuse on the part
of the Tenant or any of its servants, agents or employees or any person having
business with Tenant, Tenant will forthwith pay to the Landlord the cost of
making good the same. The Landlord acknowledges that the Premises can
accommodate the business of the Tenant.
3.21 EVIDENCE OF PAYMENT - The Tenant shall from time to time at the request of
the Landlord produce for the Landlord, reasonable and satisfactory evidence of
the due payment by the Tenant of all payments required to be made by the Tenant
under this Lease.
3.22 IMPROVEMENTS BECOME PART OF PREMISES - Subject to the terms of this Lease,
any building, erection or improvement placed or erected upon the Premises shall
become part thereof and shall not be removed and shall be subject to all the
provisions of this Lease. No building, erection or improvement shall be erected
upon the Premises herein without the prior written consent of the Landlord which
shall not be unreasonably withheld or delayed.
3.23 OVERHOLDING TENANT - If at the expiration of the Term by elapse of time the
Tenant shall hold over without the written consent of the Landlord for any
reason the tenancy of the Tenant thereafter shall be from month to month and
shall, in the absence of written agreement to the contrary, be at a monthly Base
Rent of twenty thousand dollars ($20,000.00) and subject to all covenants,
obligations and agreements provided for in this Lease, except as to duration and
rights of renewal, if any.
3.24 TENANT TO INDEMNIFY - The Tenant will indemnify and save harmless the
Landlord of and from all liability, fines, suits, claims, damages (including
lost profits, consequential damages, interests, penalties, fines or monetary
sanctions, and all legal and expert fees related thereto), losses, costs and
expenses incurred or suffered by the Landlord by reason of or resulting from or
in connection with, or arising in any manner whatsoever out of, or demands and
actions of any kind or nature to which Landlord shall or may become liable for
or suffer by reason of, liabilities caused by the negligence of the Tenant or
its officers, agents, servants, employees and contractors, and such obligation
to indemnify shall survive any termination of this Lease, anything contained
herein to the contrary notwithstanding.
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SECTION 4.00 - LANDLORD'S COVENANTS
4.01 LANDLORD'S WORK - The Landlord shall provide the following at its own cost
on or before the Occupancy Date:
(a) floor to ceiling block as per sketch submitted by the Tenant;
(b) supply 550 volt, 400 amp service, (1) 75KVa Transformer, (1)
575 V, 208A 110V Transformer;
(c) supply separate hydro and gas meters;
(d) supply separate water meter, if cost effectively possible;
and,
(e) leave existing air lines for use by the Tenant, if belonging
to the Landlord and in its possession;
where all work shall be completed to standard grade industrial finish by the
Landlord according to a sketch or drawing of proposed work to be submitted by
the Tenant to the Landlord within five (5) days of the Occupancy Date.
4.02 SIGNAGE - The Tenant may install in, erect or affix upon or about the
Premises, signs and advertising material, which shall remain the property of the
Tenant, and which the Tenant may remove upon the expiration of the Term or shall
remove at the Landlord's request upon the expiration of the Term, provided that
all damage caused by such installation, erection, affixation or removal is
repaired and the Premises left in good repair. All signs and locations thereof
are subject to prior approval in writing by the Landlord, such consent not to be
unreasonably withheld, and must conform with all municipal, local and other
laws, bylaws, ordinances and restrictions, and Landlord's regulations governing
signs, applicable thereto.
4.03 PARKING- The Tenant shall have free access to the side of the Building
proximate to the Premises for shipping purposes, and shall be allowed adequate
parking for staff and office personnel, and overnight trucking.
4.04 WARRANTIES - The Landlord warrants and represents that the roof shall be in
good repair and all mechanical, air conditioning equipment (HVAC), heating,
ventilating, plumbing, sprinkler, shipping doors, washrooms and electrical
systems shall be in good working order, normal wear and tear excepted, prior to
and on the Occupancy Date. The Landlord shall during the Term, at its cost,
maintain the roof and all such systems, as well as the interior of the Premises,
in a good state of repair.
4.05 STRUCTURAL PENETRATION - The Tenant shall be permitted four (4) openings in
the ceiling of the Premises, which shall be made at such time and in such
location according to the prior written consent of the Landlord, which consent
shall not be unreasonably withheld or delayed. The Tenant shall be permitted to
add one (1) receiving door in its shipping office on the Premises with maximum
dimensions of eighty-two (82) inches high and one hundred and thirty-six (136)
inches wide. The Tenant is to perform the work necessary to complete such
openings in a professional and workmanlike manner, at its own cost.
4.06 STRUCTURAL MAINTENANCE AND CAPITAL EXPENDITURES - The Tenant shall not be
responsible for structural maintenance or capital expenditures including major
repairs to or replacement of (which necessity for and scope of repair and
replacement shall be as determined by the Landlord's architect or appointed
expert), the roof or exterior of the Premises, parking lots, mechanical, air
conditioning equipment (HVAC), or main electrical service, unless such repairs
or replacement are caused by the negligence of the Tenant.
4.07 DAMAGE TO PREMISES - Provided that if during the continuation of
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this Lease:
(a) the Building or Premises are totally destroyed by any
casualties so that it cannot be repaired with reasonable
diligence within one hundred and twenty (120) days of the
happening of such injury, as determined by the Landlord's
architect, then the Lease shall cease and become null and void
from the date of such damage or destruction, and the Tenant
shall immediately surrender the Premises and all interest
therein to the Landlord, and the Tenant shall pay rent only to
the time of such surrender and any prepaid rent shall be
returned to the Tenant and in case of destruction or partial
destruction as above mentioned the Landlord may re-enter or
repossess the Premises discharged of this Lease, and may
remove all parties therefrom;
(b) if the Building or the Premises are partially destroyed by
casualty, and can be repaired with reasonable diligence within
one hundred and twenty (120) days from the happening of said
injury, but if the damage is such as to render the Premises
wholly unfit for occupancy, as determined by the Landlord's
architect, then the Base Rent shall not run or accrue after
the said injury, or while the process of repairs is going on,
and the Landlord shall repair the same with all reasonable
speed and then the Base Rent shall recommence immediately
after the said repairs have been completed; or,
(c) if the Building or the Premises are partially destroyed by
casualties, and can be repaired with reasonable diligence
within one hundred and twenty (120) days from the happening of
the said injury, and if the damage is such that the Premises
can be partially used, then until such damage shall have been
repaired, the Base Rent shall abate in proportion that the
part of the Premises rendered unfit for occupancy bears to the
whole of the Premises, all as determined by the Landlord's
architect and the Landlord shall repair same with all
reasonable speed.
4.08 LIMIT OF LANDLORD'S LIABILITY - Except for matters arising from the
negligence of the Landlord, its officers, agents, servants, employees or
contractors, the Landlord shall not be liable or responsible In any way for, and
the Tenant shall not be entitled to any abatement of rent in respect of, any
loss, damage, or injury of any nature whatever that may be suffered or sustained
to any persons or property, and in particular, without limiting the generality
of the foregoing, the Landlord shall not be liable for any loss, damage or
injury of any nature whatever to any person or persons or property resulting
from any defect in the Premises or in the Building or resulting from the
condition or arrangement or interruption or breakdown of any service, equipment,
machinery, utilities or other facility related to the Premises or Building, or
resulting by reason of steam, smoke, water, rain, snow, or other substances
leaking, issuing, flowing or escaping onto any part of the said Premises or by
the Landlord, its servants, employees, agents, contractors, customers, invitees
or licensees, or by other occupants of the Building, or by persons in the
Premises or the Building, or by occupants of adjacent property, or by the
public, nor shall the same constitute an eviction.
4.09 PAYMENT OF MONIES BY LANDLORD - In the event of the Tenant failing to pay
any business taxes, insurance premiums or charges which it has herein covenanted
to pay, and in the manner herein provided, the Landlord may pay the same and
shall be entitled to charge the sums so paid to the Tenant who shall pay them
forthwith on demand; and the Landlord, in addition to any other rights, shall
have the same remedies and may take the same steps for the recovery of such sums
as rent in arrears under the terms of this Lease.
4.11 LANDLORD MAY ASSIGN LEASE - The Landlord declares that it may
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assign its rights under the Lease and in the event that such an assignment is
given and executed by the Landlord and notification is given to the Tenant, the
Tenant if so requested, will, at the Landlord's cost, at any time, and from time
to time:
(a) execute an acknowledgement concerning the performance and observance
by the Landlord of its obligations under this Lease and concerning
the payment by the Tenant of the rent reserved and other sums
payable by and under this Lease as may be requested by the Landlord
or assignees;
(b) certify that this Lease is unmodified and is in full force and
effect (or if modified, stating the modification and the same is in
full force and effect as modified); and,
(c) provide particulars of any monies or security deposited hereunder
with the Landlord and whether or not there is any existing default
on the part of the Landlord of which Tenant has notice.
It is hereby agreed that any such statement delivered pursuant to the
provisions of this paragraph may be conclusively relied upon, save as to any
default on the part of the Landlord of which the Tenant does not have notice as
of the date thereof. If the Tenant fails to give such statement within
twenty-one (21) days after the receipt of notice requesting same, then the
Landlord may sign such statement as attorney for the Tenant and the contents of
such statement shall be binding on the Tenant.
4.12 QUIET ENJOYMENT - Provided that the Tenant Is not in default under the
terms of this Lease, the Tenant shall have quiet enjoyment of the Premises
during the continuance of the Term and any renewals thereof. The Tenant shall
have access to the Leased Premises from the maintenance (front of building) for
receiving guests.
4.13 SUBORDINATION OF LEASEHOLDS - Notwithstanding any clause in the Lease
herein, and any further adjustments thereto that may exist from time to time,
the parties hereto agree that The Toronto Dominion Bank has a first position
charge against the Tenant's leaseholds that are not affixed to the Premises,
ranking ahead of any interest of the Landlord against such leaseholds herein and
having priority over any rights that the Landlord herein may have against such
leaseholds as per the within Lease.
SECTION 5.00 - GENERAL PROVISIONS
5.01 PRIORITY OF LEASE - It is understood and agreed between the parties hereto
that the Term hereby granted shall not have priority over The Toronto Dominion
Bank mortgage presently registered on the property.
5.02 NOTICE OF LEASE - The Tenant shall have the right to register notice of
this Lease at its own expense, and in such case the Tenant will provide at its
own expense a copy of much notice to be registered to the Landlord, which must
be approved and executed by the Landlord, except for sufficient and reasonable
cause, prior to registry.
5.03 - This Lease is entered into subject to the condition that it is to be
effective only on obtaining such consents, if any, as may be required under the
Planning Act, R.S.O. 1980, as amended, or any successor legislation or other
statute which may hereafter be passed to take the place of the said Act or to
amend the same, and provided that such consents are granted on conditions which
are acceptable to the Landlord.
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5.04 NOTICE - Any notice required to be given hereunder to the Tenant or
in connection with the Lease, for any purpose, may be sufficiently given if sent
by registered post prepaid to the Tenant at 350 Creditstone Road, Unit #D,
Concord, Ontario, L4K 2E8. Any notice for the Landlord may be sufficiently given
if delivered to the Landlord personally or, if sent by registered post prepaid
to the Landlord at 350 Creditstone Road, Unit #C, Concord, Ontario, L4K 3X2. The
said notice shall be deemed to have been given on the third (3rd) Business Day
following the day when it Is deposited in a post office in the Regional
Municipality of York (where "Business Day" in this Lease means any day other
than a Saturday, Sunday or statutory holiday in Ontario).
5.06 TIME OF THE ESSENCE - Time shall be of the essence of this Lease.
5.07 AMENDMENTS - This Lease may not be modified or amended except by instrument
in writing signed by the Landlord and Tenant.
5.08 WAIVER - No waiver by either party of any breach by the other party of any
of its terms, covenants, obligations and stipulations, conditions and agreements
under this Lease shall be a waiver of any subsequent breach or of any other
term, covenant, obligation and stipulation, condition and agreement contained
herein, nor shall any forbearance to seek a remedy for any breach be a waiver of
any rights and remedies with respect to such or any subsequent breach.
5.09 SEVERABILITY - If any terms, covenants, obligations and stipulations,
conditions and agreements contained herein this Lease, or part thereof, or the
application thereof to any person or circumstance shall, to any extent, be
declared invalid or unenforceable by a court of competent jurisdiction, the
remainder of this Lease or the application of such terms, covenants, obligations
and stipulations, conditions and agreements contained herein to persons or
circumstances other than those as to which it is held Invalid or unenforceable,
shall not be affected thereby and each term, covenant, obligation and
stipulation, condition and agreement contained herein this Lease shall be
separately valid and enforceable to the fullest extent permitted.
5.10 HEADINGS - The article headings and section headings in this Lease have
been inserted for convenience of reference only and do not form part of this
Lease. Such headings shall not be referred to in the interpretation of this
Lease.
5.11 CHANGES REQUIRED BY CONTEXT - This Lease shall be read with all changes of
gender and number required by the context.
5.12 - This Lease shall enure to the benefit of and be binding upon the parties
hereto and their respective helm, administrators, executors, successors and
assigns.
5.13 FURTHER ACTIONS - The Tenant and the Landlord covenant with the each other
to do, execute and provide all other things as may be required by the other to
give effect to the terms, covenants, obligations and stipulations, conditions
and agreements contained herein of each other under this Lease.
5.14 APPLICABLE LAW - This Lease shall be construed in accordance with the laws
of the Province of Ontario, and of Canada as applicable therein.
5.15 WHOLE AGREEMENT - This Lease contains the whole agreement
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between the parties with respect to the subject matter of this Lease. There is
no representation, warranty, collateral agreement or condition affecting the
Building, the Premises, or this Lease, or supported by this Lease other than as
expressed in this Lease. The schedules and appendices to this Lease form part of
this Lease.
IN WITNESS WHEREOF the parties hereto have affixed their hand and
corporate seals, as applicable, as attested by the hands of their proper signing
officer duly authorized in that behalf.
SIGNED, SEALED AND DELIVERED )
in the presence of )
) ALCONE HOLDINGS LTD.
)
) ----------------------------------------
) PER. Ernesto Cascone, President
) I have authority to bind the
) Corporation
)
)
) THORNHILL BAKERY LIMITED
)
) ----------------------------------------
) PER.
) I have authority to bind the
) Corporation
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