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EXHIBIT 10.35
THIS LEASE this 25th day of July, 2001
IN PURSUANCE OF THE SHORT FORMS OF LEASES ACT
BETWEEN:
OGT HOLDINGS LTD.
Hereinafter called the "Landlord"
OF THE FIRST PART
- AND -
STARTEK CANADA SERVICES, LTD.
Hereinafter called the "Tenant"
OF THE SECOND PART
- AND -
STARTEK USA, INC.
Hereinafter called the "Guarantor"
OF THE THIRD PART
NOW WITNESSETH that in consideration of the rents, covenants and agreements
herein contained, the parties hereto agree as follows:
ARTICLE I
INTERPRETATION
SECTION 1.01 DEFINITIONS
The parties hereto hereby agree that in this Lease:
(A) "Additional Rent" means any and all sums of money or charges required
to be paid by the Tenant under this Lease, except Basic Rent whether or
not the same are designated "Additional Rent" or whether or not the
same are payable to the Landlord or otherwise. All Additional Rent
shall be and be deemed to be and treated as Rent, which Rent shall be
payable and recoverable as Rent and shall be payable in lawful money of
Canada without deduction, abatement, setoff, or compensation
whatsoever.
(B) "Architect" means the architect or professional engineer named by the
Landlord from time to time.
(C) "Basic Rent" means the rent payable by the Tenant pursuant to and in
the manner set out in Section 3.02 of this Lease.
(D) "Complex" means all those lands known as the Seaway Centre, Cornwall,
Ontario and more particularly described in Schedule "A" attached hereto
and shown outlined in blue on the Plan attached as Schedule "B" hereto,
as such lands may be altered, expanded or reduced from time to time,
and including the buildings, improvements, equipment,
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facilities, installations, systems and services erected thereon or
situate from time to time thereon, and also including all Common Areas
and Facilities.
(E) "Commencement Date" means a date calculated in accordance with the
provisions of Section 2.02 of this Lease.
(F) "Common Areas and Facilities" means (a) those areas, facilities,
utilities, improvements, equipment and installations in the Complex
which, from time to time, are not designated or intended by the
landlord to be leased to tenants of the Complex, and (b) those areas,
facilities, utilities, improvements, equipment and installations which
serve or are for the benefit of the Complex, whether or not located
within, adjacent to, or near the Complex and which are designated as
may be changed from time to time by the Landlord as part of the Common
Areas and Facilities.
(G) "Costs of Operation" shall mean, without duplication, in any calendar
year all expenses, excluding Taxes, incurred by or on behalf of the
Landlord and amounts paid by or on behalf of the Landlord with respect
to and for the complete operation, maintenance and repair of the
Complex, with the exception of the existing HVAC units and its existing
distribution system presently installed and its distribution system and
the repair, maintenance and replacement, (if necessary), of the
existing roof and without in any way limiting the generality of the
foregoing shall include the following:
(i) the total annual net costs and reasonable expenses of insuring
the lands, buildings, improvements, equipment and other
property in the Complex from time to time owned and operated
by the Landlord or for which the Landlord is legally liable,
in such manner and form, with such companies and such coverage
to be in such amounts as the Landlord, or the Landlord's
mortgagee, from time to time, determines;
(ii) cleaning, snow and ice removal, garbage and waste collection
and disposal, pest control, landscaping, paving and repaving
of the parking areas, parking lot striping and maintenance of
the landscaping, all to be done on a regular scheduled basis;
(iii) lighting, electricity, public utilities, and the cost of
electricity for signs designated by the Landlord as part of
the Complex and the Common Areas and Facilities;
(iv) managing, policing, security, supervision and traffic control;
(v) cost of the rental of any equipment and signs, and the cost of
any goods, services and building supplies used by the Landlord
in the operation and maintenance of the Complex;
(vi) all repairs including major repairs and replacements to and
maintenance and operation of the Complex and the Common Areas
and Facilities, and the systems, facilities and equipment
serving the Complex and the Common Areas and Facilities except
where the cost of any such repairs or replacements is directly
attributable to Structural Damage;
(vii) all Business Taxes and other taxes, if any;
(viii) all reasonable costs in respect of any heating, ventilating
and air conditioning or other equipment and fuel, energy and
other costs of providing heat, ventilation and air
conditioning, and the cost of maintaining elevators (if any);
(ix) the cost of providing hot and cold water;
(x) the cost of electricity including lighting of the Common
Areas;
(xi) the costs, if any, for janitorial services for the Common
areas; and
(xii) an administration fee equal to 15% of all costs enumerated in
Clauses (i) to (xi) above.
provided, however, that notwithstanding the foregoing, Costs
of Operation shall exclude interest on debt charges and
depreciation.
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For greater certainty, the exclusion from the Cost of Operation of the
expenses related to the existing HVAC units and its existing
distribution system, and existing roof shall not extend to such
equipment or roof area replaced by the Landlord or installed or
modified by the Tenant.
(G.1) "Lands" means those lands situate in Schedule "A" attached hereto;
(H) "Leased Premises" means, the premises described and outlined in green
on Schedule "B" attached hereto;
(I) "Leasehold Improvements" means all fixtures other than Trade Fixtures,
improvements, installations, alterations, and additions from time to
time made, erected or installed in the Leased Premises, whether by the
Landlord or by the Tenant including the storefront, all interior walls,
partitions and doors, all floors and all affixed floor and wall
coverings, ceilings and all lighting fixtures and all climate control,
electrical, water, gas,sewage, and other facilities and systems
installed or located within the Leased Premises;
(J) "Mortgagee" means the holder of any mortgage on the Lands;
(K) "Prime Rate" for any day shall mean the prime lending rate of The Royal
Bank of Canada at Cornwall, Ontario established from time to time, as
the reference rate of interest in order to determine the interest rate
it will charge for demand loans in Canadian funds to its Canadian
customers;
(L) "Proportionate Share" shall mean and be a fraction, which has, as its
numerator the number of square feet comprising the area of the Leased
Premises and as its denominator the number of square feet comprising
the area of the buildings in the Complex. For greater certainty the
Parties agree that the numerator is 73,841 square feet and the
denominator is 156,778 square feet, resulting in the fraction 47.1%
being deemed the "Proportionate Share" for all purposes of this Lease;
(M) "Rent" means all Basic Rent and Additional Rent payable pursuant to the
terms of this Lease;
(N) "Structural Damage" shall mean damages caused by structural defects or
weaknesses and shall include defects in the foundation, floors, stairs,
roof, load bearing walls, columns, and exterior walls unless such
damage has been caused by the negligent or willful acts or omissions of
the Tenant or those for whom the Tenant is in law responsible;
(O) "Taxes" means all real property taxes, rates, duties, and assessments
(including local improvement taxes), import charges or levies, whether
general or special, that are levied, rated, charged or assessed against
the Complex and the Lands or any part thereof from time to time by any
lawful taxing authority, whether federal, provincial, municipal, school
or otherwise, and any taxes or other amounts which are imposed in lieu
of, in substitution for, or in addition to any such real property taxes
whether of the foregoing character or not and whether in existence at
the commencement of the Term of this Lease or not, and any such real
property taxes levied or assessed against the Landlord or the owners of
the Complex and Lands, on account of its or their interest in the
Complex and Lands or any part thereof, or their ownership thereof, as
the case may be. Taxes shall also include any value added tax,
multi-stage sales tax or tax on rentals;
(P) "Term" means the term of this Lease as it is set out in Section 2.02;
(Q) "Trade Fixtures" means the trade fixtures, chattels, furniture,
machinery or equipment necessary for the Tenant's conduct of its
business at the Leased Premises.
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ARTICLE II
GRANT AND TERM
SECTION 2.01 GRANT
In consideration of the rents, covenants and agreements hereinafter
reserved and contained on the part of the Tenant to be paid, kept, observed and
performed, the Landlord hereby leases to the Tenant and the Tenant leases from
the Landlord the Leased Premises. The area of the Leased Premises shall include
the area of all floors in the Leased Premises measured from the exterior face of
all exterior walls, doors and windows.
The parties agree that included in this demise and Lease is the
mezzanine which shall be at no cost to the Tenant whatsoever and shall not be
included in any calculation for Costs of Operation or otherwise.
SECTION 2.02 TERM
TO HAVE AND TO HOLD the Leased Premises for and during the term herein
called the "Term" of the (10) years commencing on the first day of September,
2001, herein called the "Commencement Date" and thereafter next ensuing and
fully to be completed and ended on the 31st day of August, 2011.
The Tenant acknowledges and agrees that it shall be responsible for all
Additional Rent charges from and after the date that it commences doing work in
the Leased Premises to and including the Commencement Date and that such
Additional Rent charges shall include all Costs of Operation, Taxes and
Utilities.
The Tenant shall be allowed immediate possession of the Leased Premises
upon execution of this Lease by the Landlord, the Tenant and the Guarantor for
the purpose on installing its leasehold improvements. The Tenant shall not pay
any Basic Rent until the Commencement Date but shall otherwise be subject to all
terms and conditions of this Lease. The Tenant acknowledges that,
notwithstanding the giving of immediate possession, the Landlord shall be
allowed access to the Leased Premises in order to complete the Landlord's work.
The Tenant shall pay all Basic Rent and Additional Rent calculated on a
per diem basis, from the Commencement Date to the first day of the month next
following, on the Commencement Date and thereafter all payments of Rent shall be
on the first day of each month during the Term.
SECTION 2.03 OVERHOLDING
If the Tenant, without any obligation by the Landlord and without any
written agreement as to tenancy, shall remain in possession of the Leased
Premises after expiration of the Term, there shall be no tacit renewal of this
Lease or extension of the Term notwithstanding any statutory provisions or legal
presumptions to the contrary and the Tenant shall be deemed to be occupying the
Leased Premises as a Tenant from month to month at a monthly Basic Rent equal to
one hundred and twenty five per cent of the monthly installment of Basic Rent in
effect during the last month of the Term and otherwise subject to all of the
provisions of this Lease including those provisions requiring the payment of
Additional Rent which shall then be read with such changes as are appropriate to
a monthly tenancy.
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ARTICLE III
RENT
SECTION 3.01 COVENANT TO PAY
The Tenant hereby covenants with the Landlord to pay Rent as herein
provided.
SECTION 3.02 BASIC RENT
The Tenant shall pay to the Landlord as Basic Rent for and during the
Term in lawful money of Canada without any prior demand therefor and without any
deduction, abatement, set-off or compensation whatever an annual Basic Rent of
THREE HUNDRED SIXTY-NINE THOUSAND, TWO HUNDRED FIVE -------- 00/100 DOLLARS
($369,205), plus G.S.T. payable in equal monthly installments of THIRTY
THOUSAND, SEVEN HUNDRED SIXTY-SEVEN ---------- 08/100 DOLLARS ($30,767.08), plus
G.S.T. which monthly installment shall become due and be payable on the first
day of each and every month during the Term.
The parties agree that the Basic Rent is based upon 73,841 square feet
of area as defined in Section 2.01 and, the annual Basic Rent shall be
determined on the basis of a rate of $5.00 a square foot.
SECTION 3.03 PAYMENTS OF BASIC RENT
All payments of Basic Rent shall be made by cheque or money order made
payable to the Landlord or as it may direct form time to time. If the Term does
not commence on the first day of a calendar month, Rent for the broken part of a
calendar month at the commencement or end of the Term shall be pro rated at a
rate per day equal to 1/365 for the Basic Rent specified in this Section.
SECTION 3.04 ADDITIONAL RENT
The Tenant shall pay Additional Rent to the persons at the times and in
the manner hereinafter set forth. Where the calculation of any Additional Rent
is not made until after the termination of this Lease, the obligation of the
Tenant to pay such Additional Rent shall survive the termination of this Lease.
The parties acknowledge that the Additional Rent for the Leased Premises was
$2.45 per square foot for the year 2000, but this reflected municipal taxes for
a vacant property and operations of the Leased Premises not on a 24-hour
7-day-a-week basis. The Tenant acknowledges that some of the Common Area
Expenses will increase due to the occupation of the Leased Premises by the
Tenant. Unless otherwise provided in this Lease, all Additional Rent shall be
due and payable within thirty (30) days of the receipt of an invoice for payment
thereof.
SECTION 3.05 PLACE OF PAYMENT
The Tenant shall make all payments of Basic Rent and any payments of
Additional Rent required to be paid to the Landlord by this Lease by way of
cheque or money order payable to the Landlord ,or to such other person as the
Landlord may hereafter designate by notice in writing to the Tenant, and all
such payments shall be delivered or sent to the following address or to such
other person or address as the Landlord may hereafter designate:
649 Second Street East, Cornwall, Ontario, K6H 1Z7.
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SECTION 3.06 OVERDUE RENT
If the Tenant shall fail to pay when the same is due and payable any
Rent, or any other amounts required to be paid to the Landlord by this Lease,
such unpaid amounts shall bear interest from the due date thereof in accordance
with Section 12.08.
ARTICLE IV
TAXES
SECTION 4.01 REALTY TAXES
For and during the term and any extension or renewal thereof, the
Tenant shall pay the Tenant's Proportionate share of the Taxes for that year, or
any part thereof. The Tenant shall only be required to pay a proportionate part
of the Tenant's Proportionate Share of the Taxes for any year which relates to a
fiscal period of the taxing authority, a part of which is included in a period
prior to the Commencement or after the expiration of the Term.
The Landlord may, at its option, estimate the amount of the Tenant's
Proportionate Share of Taxes for any year and the Tenant shall pay to the
Landlord at the time that any monthly payment of Basic Rent reserved hereunder
is due and payable, one-twelfth of the Landlord's estimate of the Tenant's
Proportionate Share of the Taxes. Within thirty (30) days of the issuance of the
final Tax Bill , the Tenant shall pay to the Landlord the Tenant's Proportionate
Share of the Taxes for the entire year after first receiving credit for the
Tenant's Proportionate Share of the Taxes for that year already paid to the
Landlord. The Landlord shall, upon requesting payment of the balance of the
Tenant's Proportionate Share of Taxes for the year, provide the Tenant with
particulars of the calculation of the Tenant's Proportionate Share for that
year.
SECTION 4.02 SEPARATE ASSESSMENT OR APPORTIONMENT
Notwithstanding anything herein contained to the contrary, in the event
there shall be available to the Landlord from the relevant taxing authority or
otherwise, a separate assessment or apportionment and/or bill in respect of the
Leased Premises and the proportion of non-rentable areas including any parking
areas applicable to the Leased Premises for any of the Taxes referred to in
Section 4.01, then the Landlord, at its option, may use such separate assessment
or apportionment, and/or bill as the basis for establishing the Tenant's
liability for any such Taxes. The Tenant will promptly deliver to the Landlord
any such separate assessment and/or bill which may be received by the Tenant.
SECTION 4.03 BUSINESS TAXES
In addition to the Taxes payable by the Tenant pursuant to Section 4.01
hereof, the Tenant shall pay as Additional Rent to the lawful taxing authorities
and shall discharge when the same become due and payable all taxes, rates,
duties, assessments, and licence fees whatsoever, whether general or special,
whether federal, provincial, municipal or otherwise, that are levied, rated,
charged or assessed against or in respect of the use and occupancy of the Leased
Premises or the parking area or any business or the income of such business
carried on, at or from the Leased Premises, or the improvements, equipment and
facilities on or in the Leased Premises, and the Tenant will indemnify and keep
indemnified the Landlord from and against payment of and all loss, costs,
charges and expenses occasioned by or arising from any and all such taxes,
rates, duties, assessments and licence fees. The Tenant further covenants to pay
its Proportionate Share of any taxes, rates, duties, assessments and license
fees which may be levied or assessed against the Common Area and Facilities.
Upon written request of the Landlord, the Tenant shall deliver within
thirty (30) days to the Landlord satisfactory evidence of the payment of all
such taxes, rates, duties, assessments and licence fees which were due and
payable up to one month prior to such request and, in any event, shall deliver
to the Landlord before the 31st day of January in each year satisfactory
evidence of payments thereof for the preceding year.
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SECTION 4.04 TENANTS RESPONSIBILITY
The Tenant shall, upon request of the Landlord:
(A) within thirty (30) days of the due date of the payment thereof, deliver
to the Landlord for inspection, receipts of payment of all Taxes
payable by the Tenant pursuant to Sections 4.01 and 4.02;
(B) within thirty (30) days of the receipt thereof, deliver to the Landlord
notices of any assessments received by the Tenant which relate to the
Leased Premises; and
(C) furnish such other information in connection with any such Taxes and
any such Business Taxes payable by the Tenant as the Landlord
reasonably determines from time to time.
The Tenant shall indemnify and keep indemnified the Landlord
from and against payment for all loss, costs, charges and expenses occasioned by
or arising from all such Taxes and all such Business Taxes or which may be
assessed against any rentals payable pursuant to this Lease in lieu of such
Taxes or Business Taxes, whether against the Landlord or the Tenant.
SECTION 4.05 PER DIEM ADJUSTMENT
If any year during the Term of this Lease is less than twelve
(12) calendar months, the Taxes that the Tenant is required to pay pursuant to
Sections 4.01 and 4.02 hereof shall be subject to a per diem pro rata adjustment
on the basis of a period of three hundred and sixty five days (365).
ARTICLE V
UTILITIES, COSTS OF OPERATION
SECTION 5.01 UTILITIES
The Tenant shall pay as the same become due respectively all
charges for public utilities which, without limiting the generality of the
foregoing, shall include water, gas, heat , air conditioning and ventilation,
electric power or energy, steam or hot water used upon or in respect of the
Leased Premises and all charges for fittings, machines, apparatus, meters or
other things leased in respect thereof; and for all work or services performed
by any corporation or commission in connection with such public utilities. In no
event shall the Landlord be liable for any injury to the Tenant , its servants,
agents, employees, customers and invitees or for any injury or damage to the
Leased Premises or to any property of the Tenant or any property of any other
person, firm or corporation on or about the Leased Premises caused by any
interruption or failure in the supply of such utilities to the Leased Premises,
unless caused by the Landlord or those for whom the Landlord is in law
responsible. In the event separate utility meters are not supplied, the
Landlord, in consultation with its engineer, shall estimate the amount of such
utility and said charges shall become part of the Costs of Operation, payable by
the Tenant in accordance with Section 5.02 hereof. The estimate of the
Landlord's engineer with regard to the use of any utility service shall be final
and binding on the parties hereto. The Tenant shall, if requested by the
Landlord, at the Tenant's cost install a separate electrical and gas meters. The
Tenant further agrees if so requested by the Landlord to register the utility
accounts in its own name and shall pay any required deposit in connection
therewith.
SECTION 5.02 PAYMENT OF COST OF OPERATION
During the Term and any extension or renewal thereof, the Tenant
shall pay to the Landlord the Tenant's Proportionate Share of Costs of Operation
within thirty (30) days of the receipt of written demand therefor. The Landlord
may, before the commencement of each year of each fiscal period adopted by the
Landlord, reasonably estimate the Costs of Operation for such period and so
notify the Tenant and the Tenant shall pay one-twelfth of its estimated
Proportionate Share of the Costs of Operation with each monthly installment of
Basic Rent payable through that period which monthly payments may be adjusted if
the Landlord, acting
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reasonably, subsequently re-estimates Costs of Operation for such period or the
remaining portion thereof.
Notwithstanding the foregoing, as soon as bills for all or any
portion of the said amounts so estimated are received, the Landlord may bill the
Tenant for the Tenant's proportionate share thereof and the Tenant shall pay the
Landlord such amounts so billed less all amounts previously paid by the Tenant
on the Basis of the Landlord's estimate as aforesaid as Additional Rent within
thirty (30) days of receipt of written demand.
SECTION 5.03 STATEMENTS
Within a reasonable period of time after the end of the period
for which the Tenant has paid any estimated amounts, the Landlord shall deliver
to the Tenant a statement setting forth clearly the actual amounts paid by the
Landlord in relation to which the Tenant has paid the said estimated amounts and
a calculation as to how the Landlord arrived at such estimated amounts. If the
Tenant has paid in excess of the amounts due, the excess shall be applied by the
Landlord against the Tenant's next payment due hereunder. If the amounts the
Tenant has paid are less than the amounts due, the Tenant agrees to pay such
additional amounts due with the next monthly payment of Basic Rent. If any year
during the term is greater or less than any such period determined by the
Landlord as aforesaid, the Tenant's Proportionate Share shall be subject to a
per diem, pro rata adjustment based upon a period of three hundred and
sixty-five (365) days.
ARTICLE VI
CONSTRUCTION, MAINTENANCE, REPAIR AND ALTERATIONS OF THE LEASED PREMISES
SECTION 6.01 CONSTRUCTION
The Tenant acknowledges that, save and except for the work
hereinafter described, which work shall be performed by the Landlord , the
Tenant accepts the Leased Premises in an "as is, where is" condition, (except
for latent structural defects), and that all other work shall be carried out by
the Tenant in accordance with the provisions of this Lease. The Landlord shall
during the Term, including any renewal or extention thereof, maintain the
existing roof and the existing HVAC system and its existing distribution system
in good working order, and shall repair and replace same, if necessary, at
Landlord's expense; provided that the Tenant shall be responsible for the
maintenance, repair and replacement of any additions to the existing HVAC system
and its existing distribution system installed by the Tenant and, in the event
the Landlord installs a new roof on all or a portion of the Leased Premises, the
Tenant shall be responsible for the maintenance, repair and replacement of such
new roof or portion thereof. The Tenant shall have the right to verify the need
to replace such new roof or portion thereof. In the event the Landlord replaces
the existing HVAC system and its distribution system, or part thereof, or the
Tenant modifies same, the Tenant shall be responsible for the maintenance,
repair and replacement of the HVAC system or part thereof.
The Landlord shall repair any Structural Damage at Landlord's
expense.
SECTION 6.02 PERFORMANCE OF WORK
All other work in relation to the Leased Premises shall be
performed by the Tenant at his own expense. Before the Tenant carries out any
such work, he shall file with the Landlord a detailed set of drawings and
specifications showing the work and he shall not proceed without first obtaining
the Landlord's written approval, which approval shall not be arbitrarily
withheld.
The Tenant shall, prior to commencing the work, complete each of
the following obligations to the reasonable satisfaction of the Landlord:
(i) obtain the Landlord's written approval of the
Tenant's plans, such approval not to be unreasonably
withheld or delayed;
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(ii) provide the Landlord with certificates of insurance on
the Landlord's standard form duly executed by the
Tenant's insurers evidencing that the insurance
required to be placed by the Tenant pursuant to this
Lease has been contracted;
(iii) ensure that all work on or in respect of the Leased
Premises is to be performed by competent workmen. All
contractors shall be subject to the prior reasonable
approval of the Landlord, such approval not to be
unreasonably withheld or delayed;
(iv) provide evidence satisfactory to the Landlord that the
Tenant has obtained, at its expense, all necessary
consents, permits and licenses from authorities. Should
the Tenant fail to obtain any such required consent,
permit or license, the Landlord may, but shall not be
obliged to, obtain same on behalf of the Tenant and the
cost or expense incurred by the Landlord shall be
payable by the Tenant as Additional Rent forthwith on
demand;
(v) provide evidence satisfactory to the Landlord of the
Tenant's work schedule for completion of the Tenant's
work.
In performance of the Tenant's work, the Tenant shall:
(i) comply with all applicable laws, building codes,
permits and approvals for such work as well as the
requirements of the Landlord's insurers. If the Tenant
is in default in its compliance with any applicable
laws, by-laws, building codes, permits or approvals
from any governmental or other authority having
jurisdiction or the requirements of the Landlord's
insurers, and the Tenant does not correct any such
default within the time period required by any such
authority or insurer, the Landlord may (but not shall
not be obligated to), cure any such default and all
charges and costs incurred by the Landlord, of the
costs or charges incurred by the Landlord shall be paid
by the Tenant as Additional Rent forthwith on demand;
(ii) after satisfying the requirements required to be
performed by the Tenant prior to the commencement of
the Tenant's work as set out in this Lease, but not
before, proceed to complete the Tenant's work in a good
and workmanlike manner using new materials, the whole
to the Landlord's reasonable satisfaction and in
conformity with the Plans;
(iii) comply with and cause its contractors or
subcontractors, tradesmen and suppliers to comply with
all the provisions of the Plans, this Lease, the rules
and regulations of the Landlord with respect to
construction practices and conditions, such as safety,
security and hours of work, etc., together with such
other rules and regulations as may be laid down form
time to time by the Landlord;
(iv) retain on the Leased Premises at all times when the
Tenant's work is being performed one set of the
Tenant's plans with the Landlords approval endorsed
thereon; and
(v) permit the Landlord, without prejudice to the
Landlord's other remedies, at the Tenant's expense, to
remove any Tenant's work, if material in nature,
undertaken without the Landlord's prior written
approval and to restore the Leased Premises to their
prior condition, and the Tenant shall pay the Landlord
as Additional Rent forthwith on demand the cost of
removal and renovation;
The following additional requirements shall apply in respect of
the performance of the Tenant's work:
(i) The Landlord retains the right of reasonable
surveillance of the work forces involved.
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(ii) during the performance of the Tenant's work , the
Tenant shall remove all garbage and debris from the
Leased Premises as required and place same in
designated garbage containers provided by the Landlord.
If the Landlord is required to remove any of the
Tenant's garbage or debris from within or adjacent to
the Leased Premises to the designated drop off location
for such garbage, the cost of removing same shall be at
the Tenant's expense and paid for by the Tenant to the
Landlord as Additional Rent.
(iii) any damage to the Leased Premises or the Complex caused
during the completion of the Tenant's work by the
Tenant or those for whom it is in law responsible
including the Tenant's contractors and such
contractors' agents shall be repaired forthwith by the
Tenant. If the Tenant fails to carry out such repairs,
then the Landlord may, but shall not be obligated to
carry out same and all charges and costs incurred by
the Landlord plus a supervision fee of five percent (
5%) shall be payable by the Tenant as Additional Rent ;
(iv) the Landlord shall at all times be entitled to continue
its construction activities in the Leased Premises and
in the Complex; and
(v) throughout the period during which the Tenant's work is
being performed, the Tenant shall be subject to all of
the other terms and conditions of this agreement and
the Lease insofar as they are applicable, including,
without limitation, the provisions relating to the
liability of the Tenant for its acts and omissions and
the acts and omissions of its servants, agents,
employees, contractors, invitees, concessionaires and
licensees and the indemnification of the Landlord.
SECTION 6.03 TENANT'S REPAIR
The Tenant covenants that, throughout the Term and any extension
or renewal thereof, at its sole cost and expense, it shall maintain in good
order and first class condition (including periodic painting and decorating),
repair and replace to the extent necessary the Leased Premises or any part
thereof, together with any equipment or systems of any nature supplying services
to the Leased Premises which are located in the Leased Premises or which are
installed by or on behalf of the Tenant for the Leased Premises, excepting only
Structural Damage and excepting Landlord's obligations under Section 6.01.
The Tenant covenants that it shall, at the expiration or other
termination of the Term, and at the request of the Landlord, restore the Leased
Premises to their original state and condition normal wear and tear excepted. If
the Tenant fails to carry out such restoration then the Landlord may, but shall
not be obligated to, carry out same and all charges and costs incurred by the
Landlord in so doing plus a supervision fee equal to five percent (5%) shall be
payable by the Tenant to the Landlord as Additional Rent.
SECTION 6.04 NON-PERFORMANCE BY TENANT
If any repairs, replacements or maintenance which are required to
be performed by the Tenant under the terms of this Lease are not performed when
required, then the Landlord acting reasonably shall be entitled to perform such
repairs, replacements or maintenance entirely at the cost of the Tenant and the
cost of the same shall be paid forthwith by the Tenant to the Landlord as
Additional Rent.
SECTION 6.05 INSPECTION
The Landlord may upon reasonable prior notice to the Tenant enter
the Leased Premises and every part thereof to inspect the condition thereof.
Where an inspection reveals that the whole or any part of the Leased Premises
are not being operated, kept or maintained to the standard of similar buildings
in the City of Cornwall or that repairs or replacements are necessary under the
terms of this Lease, the Landlord shall give written notice to the Tenant and
upon receipt of such notice the tenant shall forthwith proceed to carry out all
necessary work, repairs and replacements in a good and workmanlike manner and to
the reasonable satisfaction
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of the Landlord so as to complete the same within time or times stipulated in
such notice, provided that such work, repair and replacement can be reasonably
completed in such time period. Failure by the Landlord to give such notice shall
not relieve the Tenant from any of its obligations to operate, maintain, repair
or replace in accordance with the provisions hereof. If the Tenant refuses or
neglects to carry out promptly and to the reasonable satisfaction of the
Landlord any such work, repairs or replacements, the Landlord may, but shall not
be obligated to, carry out such work, repairs or replacements without liability
to the Tenant for any loss or damage which may occur to the Tenant's property or
business by reason thereof, and in any and every such case the Tenant covenants
with the Landlord to pay to the Landlord as Additional Rent all sums which the
Landlord may have expended in carrying out such work, repairs or replacements
plus a further 5% of all such sums representing the Landlord's overhead and
profit. The Tenant agrees that the carrying out of any work, repairs or
replacements by the Landlord pursuant to this Section is not a re-entry or a
breach of any covenant for quiet enjoyment contained in this Lease. In the case
of any emergency, the Landlord may enter upon the Leased Premises at any time
without giving prior notice to the Tenant without breaching any covenant for
quiet enjoyment contained in this Lease.
SECTION 6.06 COMPLIANCE WITH FIRE AND OTHER REGULATIONS
The Tenant covenants at its sole cost and expense to comply with
and conform to the requirements of all applicable statutes, laws, by-laws,
regulations, ordinances and orders from time to time enforced during the Term
and relating to or affecting the condition, equipment, maintenance, use or
occupation of the Leased Premises and with every applicable regulation, order
and requirement of the Insurance Advisory Organization, or any body having a
similar function or any order, request or demand of any municipal fire
department or other similar body, or fire insurance company by which the
Landlord and the Tenant or either of them may be insured at any time during the
Term. Such work shall be performed by the Tenant within the time period set out
above in Section 6.06 and failure of the Tenant to so complete such work shall
entitle the Landlord to perform such work at the cost of the Tenant as specified
in Section 6.06 above.
SECTION 6.07 ALTERATIONS
The Tenant shall not make or permit to be made any Leasehold
Improvements, including installation of any electrical or other equipment
including, air conditioning units or service facilities without obtaining the
prior written approval of the Landlord thereto, which approval shall not be
unreasonably or arbitrarily withheld, or delayed; provided that the Tenant has
fully complied with the terms, covenants and conditions of this Lease, but which
shall be subject to the following conditions:-
(A) at the time of requisitioning the Landlord's approval, the Tenant shall
submit to the Landlord reasonably detailed plans and specifications for
such proposed alterations, additions, changes or improvements;
(B) any proposed alterations, additions, changes or improvement shall meet
the requirements of all governmental or other authorities, fire
insurance underwriters, insurers and any mortgagee;
(C) any alterations, additions, changes or improvement proposed by the
Tenant shall be such as will not, when, completed, diminish the value
or utility of the Leased Premises or the Complex;
(D) the Tenant shall not under any circumstances whether in respect of
changes, alterations and improvements to the Leased Premises pursuant
to this Section or work performed pursuant to this Section or work
performed pursuant to Section 6.04 or otherwise, permit any lien,
encumbrance or charge except for any notice of this Lease, to be filed
against the Leased Premises or the Complex and in the event of filing
of such lien, encumbrance or charge shall forthwith cause the same to
be discharged from the records of the Land Registry office or Land
Titles Office within fifteen (15) days after written demand therefor by
the Landlord. If the Tenant fails to discharge or cause any such lien
to be
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discharged as aforesaid then in addition to any other right or remedy
of the Landlord, the Landlord may, but it shall not be obligated to
discharge the same and any amount so paid by the Landlord and all costs
and expenses including solicitor's fees on a solicitor and his client
basis incurred for the discharge of such lien shall be immediately due
and payable by the Tenant to the Landlord within thirty (30) days of
written demand;
(E) no alterations, additions, changes or improvements shall be commenced
until the Tenant shall have obtained all building and other permits
required by lawful authority;
(F) all alterations, additions, changes or improvements approved by the
Landlord shall be constructed expeditiously by the Tenant, in a good
and workmanlike manner and in compliance with the detailed plans and
specifications which have been approved by the Landlord; and
(G) prior to the commencement of construction of any improvements or
alterations, the Tenant shall effect and produce to the Landlord
evidence of good and sufficient public liability, property damage and
fire insurance policies relative to such construction written in the
joint names of the Landlord and Tenant with insurers acceptable to the
Landlord acting reasonably and in such amounts as may be reasonably
required by the Landlord.
SECTION 6.08 LEASEHOLD IMPROVEMENTS
Any Leasehold Improvements shall immediately upon placement
become the property of the Landlord and form part of the Leased Premises without
compensation therefor to the Tenant, but the Landlord shall be under no
obligation to maintain, repair or replace the Leasehold Improvements. No
Leasehold Improvements shall be removed from the Leased Premises either during
or at the expiration or other termination of the Term or any extension or
renewal thereof except that the Tenant shall, at such expiration or other
termination, at its own cost, remove such of the Leasehold Improvements
installed on the Leased Premises by the Tenant as the Landlord shall require to
be removed within a reasonable time after such expiration or termination, having
regard to the nature of the Leasehold Improvements and shall promptly repair any
damage to the Leased Premises caused by their installation and/or removal and
leave the Leased Premises in the condition they were in prior to the
installation of such Leasehold Improvements, normal wear and tear excepted. The
Tenant's obligation to observe and perform this covenant shall survive the
expiration or other termination of this Lease.
SECTION 6.09 CONSTRUCTION LIENS
If any construction Liens, mechanics liens or other liens or
order for payment of money shall be filed against the Leased Premises, the
Complex or the Lands by reason of or arising out of any work, labour, services
or materials furnished or claimed to have been furnished to the Tenant or to
anyone claiming through the Tenant, the tenant shall within fifteen (15) days
after notice to the Tenant of the filing cause the same to be discharged by
bonding, deposit, payment , court order or in any other manner required or
permitted by law. The Tenant, at its own expense, shall defend all suits to
enforce any such lien or order whether against the Tenant or the Landlord. The
Tenant will indemnify and keep indemnified the Landlord from and against payment
of all loss, costs, charges, expenses occasioned by or arising from any such
lien or order
SECTION 6.10 ACKNOWLEDGMENT OF TENANT
The Tenant acknowledges that the Leased Premises form part of the
Complex, and that the whole of the Complex may be served by common utility
systems. In the event that repairs are necessary to any of such systems and any
portion of the Complex of which the Leased Premises form part the Tenant
covenants to bear its Proportionate Share of the total cost of such repairs. It
is expressly agreed that if any such common systems shall have been damaged or
shall have become inoperative by reason of the negligence of the Tenant, Its
servants or agents, then the entire cost of repairing the same shall be borne by
the Tenant and including the cost of structural repairs thereto.
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ARTICLE VII
TRADE FIXTURES AND SURRENDER
SECTION 7.01 TRADE FIXTURES
Subject to the provisions of Section 6.09 hereof the Tenant shall
have the right at all times to install its Trade Fixtures. All Trade Fixtures
shall be owned by and be the property of the Tenant and shall not be removed
from the Leased Premises either during or at the expiration or other termination
of the Term or any extension or renewal thereof except that:-
(A) the Tenant may in the usual and normal course of its business remove,
at its own cost, such of its Trade Fixtures which have become excess
for the Tenant's purposes or which are being concurrently replaced with
new and similar Trade Fixtures; and
(B) the Tenant shall at the expiration or earlier termination of the Term
or any extension or renewal thereof remove, at its own cost, all of its
Trade Fixtures.
The Tenant shall not at the time of any such removal be in
default under any covenant or agreement contained in this Lease and, if in
default, the Landlord shall have a lien on such Trade Fixtures as security
against loss or damage resulting from any such default by the Tenant and said
Trade Fixtures shall not be removed by the Tenant until such default is cured,
unless otherwise directed by the Landlord; and provided further that the Tenant
shall promptly repair any damage to the Leased Premises caused by the
installation and/or removal of such Trade Fixtures. The Tenant's obligation to
observe and perform this covenant shall survive the expiration or other
termination of this Lease.
It is understood and agreed that, if the Tenant shall fail to
remove any of its Trade Fixtures within a reasonable time after the expiration
or other termination of the Term or any extension or renewal thereof, such Trade
Fixtures shall, at the option of the Landlord, become the property of the
Landlord and may be removed from the Leased Premises and sold or disposed of by
the Landlord in such manner as it deems advisable
SECTION 7.02 SURRENDER OF LEASED PREMISES
Subject to the provisions of Section 6.09 and Section 7.01
hereof, at the expiration or other termination of the Term or any extension or
renewal thereof, the Tenant shall peaceably surrender and yield up unto the
Landlord the Leased Premises together with all Leasehold Improvements in as good
order, condition and repair as the Tenant is required to maintain the Leased
Premises under the terms of this Lease, normal wear and tear excepted. The
Landlord, at its option, may repair any damage to the Leased Premises existing
at the time of such surrender at the sole cost of the Tenant and the Tenant
shall pay to the Landlord such cost as Additional Rent.
ARTICLE VIII
CONDUCT OF BUSINESS BY TENANT
SECTION 8.01 USE
The Leased Premises or any part thereof shall not be used for any
purpose other than the business of a call centre or business or professional
office. The Landlord warrants and represents that the Tenant's use of the Leased
Premises as a call centre is currently permitted under the provisions of the
zoning by-laws of the Corporation of the City of Cornwall.
The Leased Premises or any part thereof shall not be used for
carrying on any business involving the sale of second-hand goods, war-surplus
goods, insurance salvage stock or fire-sale stock, or carrying on any auction or
pawnshop business or any fire sale (except of goods damaged by fire occurring in
the Leased Premises and during the 30-day period following such fire),
bankruptcy sale, "going out of business" sale, moving sale, bulk sale except a
bulk
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sale in accordance with any Bulk Sale legislation in connection with a permitted
disposition by the Tenant of this Lease or the Leased Premises or any other
business which because of merchandising methods or otherwise would, in the
opinion of the Landlord, tend to lower the character of the Complex. The Leased
Premises shall not be used for any special sale or sales other than such as are
incidental to the normal routine of the Tenant's business upon the Leased
Premises with its regular customers. Without limiting the generality of the
foregoing and notwithstanding the permitted uses above the Tenant covenants that
the Leased Premises shall not be used in whole or in part for any of the
purposes set out in Schedule "C" attached hereto or any combination thereof; The
Tenant shall not permit any business to be operated in or from the Leased
Premises, or any part thereof, by any licensee or concessionaire without the
prior written consent of the Landlord, such consent not to be unreasonably
withheld or delayed.
Provided that the Tenant is not in material default under the
terms of this Lease, and as long as the Tenant which is occupying the Leased
Premises is STARTEK CANADA SERVICES, LTD., or a permitted assignee or sub-tenant
of STARTEK CANADA SERVICES, LTD., the Landlord covenants not to lease, directly
or indirectly, any portion of the Complex or to erect any other building within
a radius of ten (10) miles of the Complex, for the purpose of occupation by a
third party conducting the business of a call centre.
SECTION 8.02 WASTE AND NUISANCE
The Tenant shall not commit or suffer to be committed any waste
or injury to the Leased Premises and shall not do or omit to do or suffer to be
done or omitted to be done anything upon or in respect of the Leased Premises
which shall be or result in a nuisance, annoyance and/or menace to the Landlord
or to other tenants or occupants of the Complex.
Without limiting the generality of the foregoing, the Tenant
shall not:-
(A) overload any floors in the Leased Premises;
(B) install any equipment which will exceed or overload the capacity of any
utility or the electrical or mechanical systems or facilities in or
serving the Leased Premises;
(C) bring upon the Leased Premises or any part thereof any machinery,
equipment, article or thing that by reason of its weight, size or use
might in the reasonable opinion of the Landlord, damage the Leased
Premises;
(D) use, keep or permit in or about any part of the Leased Premises any
goods, provisions, equipment or materials of an offensive odor or
combustible or a noxious nature or anything which could create a fire
hazard;
(E) allow any refuse, garbage, or other loose or objectionable material to
accumulate in or about the Leased Premises or the Complex and will at
all times keep the Leased Premises in a clean and wholesome condition.
The Tenant further covenants that at the time of termination of the
tenancy it will leave the Leased Premises in a clean and tidy
condition, normal wear and tear excepted; and
(F) allow the plumbing fixtures to be used for any other purpose than that
for which they are constructed and no foreign substance of any kind
shall be thrown therein and the expense of any breakage, stoppage or
damage shall be borne by the Tenant who shall or whose employees
agents, licensees or invitees shall have caused it.
In the event that the Tenant shall infringe any of the provisions
of this Section and fail within seventy-two (72) hours of notice by the Landlord
to rectify, correct or remove the infringement, the Landlord may and is hereby
so authorized to enter upon the Leased Premises or elsewhere as may be necessary
to rectify, correct or remove the infringement as the agent and at the
reasonable cost of the Tenant and the Tenant agrees that any such entry by the
Landlord is not a re-entry or a breach of any covenant for quiet enjoyment
contained in this Lease. The Tenant shall indemnify and save harmless the
Landlord from all claims, demands, loss or damage to any person or property
arising out of any such infringement or any such entry of the Landlord.
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SECTION 8.03 ENVIRONMENT
(A) The Tenant covenants with the Landlord,
(i) that it will not carry on any activity that contravenes the
provisions of any municipal, provincial or federal statute
governing environmental protection, or health or safety
standards, and without limiting the generality of the foregoing
including the Environmental Protection Act of Ontario, R.S.O.
1990, c. E.18, and 19, as amended and the Occupational Health
and Safety Act, R.S.O. 1990, c.0.1, as amended;
(ii) that no substances injurious to human life or health
(hereinafter referred to as Hazardous Substances) will be used
or stored in the Leased Premises or anywhere else in the
building or buildings of which the Leased Premises form part.
The presence of any such hazardous substance in any of the area
hereinbefore mentioned shall be deemed to be a default under
this Lease. Any such default shall entitle the Landlord to
forthwith terminate this Lease. The term "Hazardous Substances"
shall mean any substance injurious or designated as hazardous or
toxic waste, hazardous or toxic material, a hazardous or toxic
substance or other similar term by any federal, provincial or
municipal environmental statute, regulation or ordinance;
(iii) that it will notify the Landlord at once in the event any toxic
or hazardous substances, including spent reactor fuel, other
radioactive waste, PCBs or noxious gases (the "contaminants"),
are produced on or brought on the Leased Premises, and will
enter into a contract with a properly authorized disposal
authority (which contract must have the prior approval of the
Landlord) for the neutralizing or disposal of such contaminants,
and the Tenant shall leave the Leased Premises at the
termination of this lease, by whatever cause, free from all
pollution by such contaminants;
(iv) that it will not stockpile any toxic or hazardous substances,
including spent reactor fuel and other radioactive waste, PCBs
or noxious gases, on the Leased Premises and if such
contaminants are produced on the Leased Premises it will at once
notify the Landlord and enter into a contract with a properly
authorized disposal authority (which contract must have the
prior approval of the Landlord, such approval not to be
unreasonably withheld or delayed) for the neutralizing or
disposal of such contaminants;
(v) that it shall comply with all of the requirements of the
Ministry of the Environment and any other governmental agency
with authority over the Tenant's process;
(vi) that it shall permit the Landlord to inspect the Leased Premises
at all reasonable times and with twenty-four (24) hours prior
notice with such experts and technical personnel as the Landlord
deems necessary, to oversee the production, storage, stockpiling
and disposal of any substances deemed toxic by the Landlord or
liable to cause pollution within or without the Leased Premises
and to confirm that the Leased Premises are free of all
contaminants at the termination for whatever cause of this
Lease, and that it shall pay all reasonable expenses of the
Landlord in relation thereto; and
(vii) that it shall, when required to do so by notice in writing from
the Landlord, obtain insurance coverage with an insurance
company and in the amounts and on terms having the prior
approval of the Landlord, sufficient to protect the Landlord
from all liability in respect of pollution arising from the
activities of the Tenant on the Premises.
(B) The Tenant shall indemnify, defend and save the Landlord harmless from
and against all costs (including the cost to the Landlord of carrying
out any work to be performed by the Tenant under this clause) claims,
demands, liabilities, suits, actions or proceedings of any type
whatsoever, for damages (including punitive damages), losses,
deficiencies,
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assessments, fines, penalties, judgments (including pre and post
judgment interest), work or clean up orders and other liabilities or
obligations of any type, (including costs of investigation, legal fees
on a solicitor and client basis and consultants' fees) arising out of
any breach by the Tenant of the covenants contained in Section 8.03.
(C) The Landlord covenants and agrees with the Tenant that it shall be
liable for and shall hold the Tenant and its officers, directors,
employees, agents and its related or affiliated corporate entities
(hereinafter collectively called the "Tenant") harmless and shall
indemnify the Tenant from and against any and all liability directly or
indirectly incurred by the Tenant by reason of any claims, orders,
demands, suits, actions, causes of action, losses, costs, liability and
expenses (including legal fees on a solicitor and client basis and
consultants' fees) which the Tenant may sustain, incur, suffer, or have
asserted against it, relating to, arising out of, resulting from or in
any way connected with the environmental condition of the Leased
Premises which existed as of the Commencement Date, or caused by the
Landlord or those for whom the Landlord is in law responsible.
ARTICLE IX
ASSIGNMENT AND SUBLETTING
SECTION 9.01 CONSENT REQUIRED
The Tenant shall not:-
(A) assign this Lease in whole or in part;
(B) sublet the whole or any part of the Leased Premises; or
(C) suffer or permit the use or occupation of the whole or any part of the
Leased Premises by any licensee, concessionaire or franchisee or by a
person, firm or corporation other than the Tenant;
(D) mortgage or encumber this lease;
each of the foregoing being herein referred to as a "Transfer" and each
person to whom any such Transfer is made or proposed to be made being
herein referred to as a "Transferee", without the prior written consent
of the Landlord in each instance, which consent shall not be
unreasonably withheld or delayed; provided that the Landlord's consent
to any Transfer shall not constitute a waiver of the necessity for such
consent to any subsequent Transfer; provided further that,
notwithstanding any such Transfer, the Tenant shall not be relieved
from its obligations for the payment of Basic Rent and Additional Rent
and for the full and faithful observance and performance of the terms,
conditions, covenants and agreements herein contained on the part of
the Tenant to be paid, kept, observed and performed; provided further
that the Tenant shall, if requested by the Landlord, cause any such
Transferee to covenant in writing with the Landlord to be bound by all
of the terms, conditions, covenants and agreements herein contained on
the part of the Tenant to be paid, kept, observed and performed as if
such Transferee had originally executed this Lease as Tenant; and
provided further that all documents evidencing such Transfer, the
consent of the Landlord and the Transferee's covenant with the Landlord
shall be subject to the prior written approval of the Landlord or its
solicitors and all of the Landlord's reasonable legal costs with
respect thereto, shall be paid as Additional Rent by the Tenant to the
Landlord forthwith upon demand.
Provided however that the Tenant may assign this Lease to any
company or companies "affiliated" or "related" (as those terms are defined under
the Canada Business Corporations Act as of June 1st, 2001) without the consent
of the Landlord.
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Provided further that the Tenant shall not be entitled to assign
this Lease or sub-let the whole or any part of the Leased Premises unless such
assignee or sub-tenant executes an agreement in favour of the landlord that it
shall be bound by all of the provisions hereof.
If there is a permitted Transfer of this Lease, the Landlord may
collect Rent from the assignee, sub-tenant or occupant and apply the net amount
collected to the Rent required to be paid pursuant to this Lease, but no
acceptance by the Landlord of any payments by a Transferee shall be deemed a
waiver of this covenant, or the acceptance of the Transferee as Tenant, or a
release of the Tenant from the further performance by the Tenant of the
covenants or obligations on the part of the Tenant herein contained. Any
document or consent evidencing such Transfer of this Lease if permitted or
consented to by the Landlord shall be prepared by the Landlord or its
solicitors, and all legal costs, with respect thereto shall be paid by the
Tenant to the Landlord forthwith upon demand.
If the Tenant wishes to effect a Transfer, the Tenant shall by
notice to the Landlord request the Landlord to consent to such Transfer, which
notice shall set forth full particulars of the proposed Transfer and shall be
accompanied by a copy of the agreement of other document setting out the terms
of the proposed Transfer. Following the receipt of such notice, the Landlord may
request further reasonable information in connection with the proposed Transfer
including, without limitation, information concerning the responsibility,
reputation, financial standing and business of the proposed Transferee. The
Tenant shall promptly furnish the Landlord with such requested information.
SECTION 9.02 SUBLET OF MINIMUM AREA
The Tenant may:-
(A) assign this Lease in whole or in part;
(B) sublet the whole or any part of the Leased Premises; or
(C) suffer or permit the use or occupation of the whole or any part of the
Leased Premises by any licensee, concessionaire or franchisee;
to a particular assignee, sub-tenant, licensee, concessionaire or franchisee for
the use of the whole or any part of the Leased Premises, having a minimum area
of eighteen thousand (18,000) square feet.
ARTICLE X
INSURANCE AND INDEMNITY
SECTION 10.01 TENANT'S INSURANCE
The Tenant shall during the Term of this Lease and during such
other time as the Tenant occupies the Leased Premises or any part thereof, at
its sole cost and expense, take out and keep in full force and effect the
following insurance:-
(A) "all risks" insurance, including but not limited to loss, or damage
caused by, or resulting from fire, lightning, theft, collapse, water
damage, sprinkler leakage, earthquake, wind storm, and other additional
perils defined in an Insurance Bureau of Canada (I.B.C.) approved "all
risks" policy upon property of every description and kind owned by the
Tenant, or for which the Tenant is legally liable, and which is located
in, at or on the Leased Premises including, without limitation, trade
fixtures and equipment, furniture, fittings and stock-in-trade, and
Tenants Improvements, in an amount not less than the full replacements
cost thereof;
(B) broad form boiler and machinery insurance on blanket repair and
replacement basis with limits for each accident in an amount not less
than the replacement cost of all leasehold improvements and of all
boilers, pressure vessels, air-conditioning equipment and
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miscellaneous electrical apparatus owned or operated by the Tenant or
by others other than the Landlord on behalf of the Tenant in the Leased
Premises, or relating to or serving the Leased Premises;
(C) "all risks" Tenant's legal liability insurance for the actual cash
value of the Leased Premises including loss of use thereon; and
(D) comprehensive general liability insurance including by not limited to
personal injury liability, contractual liability, contingent employer's
liability, non-owned automobile liability and owners' and contractors'
protective insurance coverage with respect to the Leased Premises and
the Tenant's use of any part thereof or of the Common Areas and
facilities, including the activities, operations and completed
operations and work conducted or performed by the Tenant, by any other
person on behalf of the Tenant, by those for whom the Tenant is in law
responsible and by any other person on the Leased Premises or of the
Common Areas and Facilities; such policy or policies shall be written
with inclusive limits of bodily injury, including death, and property
damage of not less than $2,000,000.00 for any one occurrence and such
higher limits as the Landlord may reasonably require from time to time;
all such policy or policies shall contain a broad form property damage
endorsement, shall have employees added as additional named insureds
and shall be written on a blanket contractual (non-reporting basis);
(E) plate glass insurance on all plate and other glass in the Leased
Premises;
(F) any other form of insurance as the Landlord may reasonably require from
time to time in form, in amounts and for insurance risks against which
a prudent landlord or tenant under similar circumstances would insure.
Each of the foregoing policies of insurance shall name the
Landlord and its mortgagee (s), if any, as additional named insureds as their
interests may appear and shall contain: the Insurance Bureau of Canada (I.B.C.)
approved standard mortgage clause as may be reasonably required by the
Landlord's mortgagee (s); a waiver of any subrogation rights which the Tenant's
insurers may have against the Landlord or those for whom the Landlord is in law
responsible, if available; a severability of interests clause and a cross
liability clause, if available; a waiver in favour of the Landlord and its
mortgagee (s), if any, if available, of any breach of warranty clause to the
effect that such insurance policy shall not be invalidated as respects their
interests by reason of any breach or violation of any warranties,
representations, declarations or conditions contained in such policy; and a
clause, if available, stating that such insurance policy will be considered as
primary insurance and shall not call into contribution any other insurance that
may be available to the Landlord. Each of the foregoing policies of insurance
shall be in a form reasonably satisfactory to the Landlord, shall be placed with
Insurers licensed either individually or dually in the Province of Ontario or
the Dominion of Canada (said Insurers to be reasonably satisfactory to the
Landlord), and shall contain an undertaking by the insurer to notify the
Landlord and its mortgagee (s), if any, in writing not less than thirty (30)
days prior to any material change, cancellation or termination thereof. The
Tenant shall deliver to the Landlord and its mortgagee (s), if any, certificates
of such insurance, or, if requested by the Landlord or such mortgagee (s), a
certified copy of each such policy of insurance.
SECTION 10.02 FAILURE TO INSURE
If the Tenant fails to take out or to keep in force any such
insurance referred to in Section 10.01 hereof, or should any such insurance not
be approved by either the Landlord or the mortgagee, if any, and should the
Tenant not rectify the situation within 72 hours after written notice thereof,
the Landlord may, but shall not be obligated to, effect such insurance and the
Tenant shall pay to the Landlord as Additional Rent forthwith on demand all
premiums, costs, charges and expenses incurred by the Landlord in effecting such
insurance.
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SECTION 10.03 CANCELLATION OF INSURANCE
If any insurance policy upon or in respect of the Leased Premises
or any part thereof shall be cancelled or shall be threatened by the insurer to
be cancelled or the coverage thereunder, or the limits of insurance, reduced in
any way by reason of the use or occupation of the Leased Premises or any part
thereof by the Tenant or by any assignee or sub-tenant of the Tenant or by
anyone permitted by the Tenant to be upon the Leased Premises and if the Tenant
fails to remedy the condition giving rise to the cancellation, threatened
cancellation or reduction of coverage within 72 hours after notice thereof, the
Landlord may, at its option, either (a) re-enter the Leased Premises forthwith
by leaving upon the Leased Premises a notice in writing of its intention to do
so and thereupon all of the Landlord's rights and remedies on re-entry contained
in this Lease shall apply, or (b) enter upon the Leased Premises and remedy the
condition giving rise to such cancellation, threatened cancellation or
reduction, including removal of the offending article, and the Tenant shall
forthwith pay as Additional Rent the cost thereof to the Landlord and the
Landlord shall not be liable for any damage or injury caused to any property of
the Tenant or of others located on the Leased Premises as a result of any such
entry, and the Tenant agrees that any such entry by the Landlord is not a
re-entry or a breach of any covenant for quiet enjoyment contained in this
Lease.
SECTION 10.04 INCREASE OF INSURANCE RATES
If the Tenant or its officers, directors, agents, servants,
licensees, concessionaires, assignees or sub-tenants shall bring onto the Leased
Premises or do or permit to be done or omit to do upon or about the Leased
Premises anything that causes the rate of insurance to increase even though such
use may be a permitted use hereunder the Tenant shall pay to the Landlord, as
Additional Rent, forthwith upon demand the amount of such increase, or at the
option of the Landlord, remove entirely the risk factors as identified by the
Landlord's insurance underwriters which have necessitated an increased rate of
insurance, or caused the Landlord's policy to be voided due to a material change
in risk, use and occupancy as initially reported to the Landlord's insurers.
SECTION 10.05 LOSS OR DAMAGE
Except for acts of negligence of the Landlord or those persons
for whom, in law, the Landlord is responsible, the Landlord shall not be liable
to the Tenant for any death or injury arising from or out of any occurrence in,
upon, at or relating to the Leased Premises, or damage to property of the Tenant
or of others located on the Leased Premises. Without limiting the generality of
the foregoing, the Landlord shall not be liable for any death, injury, loss,
damage of or to persons or property resulting from fire, explosion, steam,
electricity, gas, water, sleet, snow, ice or leaks from any part of the Leased
Premises or caused by windstorm, hail, impact by aircraft, or land vehicle,
smoke, lightning, riot, vandalism, malicious acts, earthquake or from the pipes,
sprinklers, appliances , plumbing works, roof, windows or sub-surface of any
floor or ceiling of the Complex or from the Lands of from the street or from any
other place or by any other cause whatsoever.
SECTION 10.06 INDEMNIFICATION OF LANDLORD
Notwithstanding any other terms, covenants and conditions
contained in this Lease, the Tenant shall indemnify the Landlord and save it
harmless from and against any and all loss including loss of Rent payable by the
Tenant pursuant to this Lease, claims, action, damages, liability and expenses
in connection with loss of life, personal injury, damage to property or any
other loss or injury whatsoever arising from or out of this Lease, or any
occurrence in, upon or at the Leased Premises, or the occupancy or use by the
Tenant of the Leased Premises or any part thereof, or occasioned wholly or in
part by any negligent act or omission of the Tenant or of those for whom the
Tenant is in law responsible. If the Landlord shall, without fault on it's part,
be made a party to litigation commenced by or against the Tenant, then the
Tenant shall protect, indemnify and hold the Landlord harmless and shall pay all
costs, expenses and reasonable legal fees incurred or paid by the Landlord in
connection with such litigation. The Tenant shall also pay all costs, expenses
and legal fees that may be incurred or paid by the Landlord in enforcing the
terms, covenants and conditions in this Lease, unless a court shall decide
otherwise.
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SECTION 10.07 INDEMNIFICATION OF TENANT
Notwithstanding any other terms, covenants and conditions
contained in this Lease, the Landlord shall indemnify the Tenant and save it
harmless from and against any and all claims, action, damages, liability and
expenses in connection with loss of life, personal injury, damage to property or
any other loss or injury whatsoever arising from any occurrence in, upon or at
the Leased Premises occasioned wholly or in part by a negligent act or omission
of the Landlord or those for whom the Landlord is in law responsible. If the
Tenant shall, without fault on its part, be made a party to litigation commenced
by or against the Landlord in respect of a breach of a covenant contained herein
on the part of the Landlord to be performed or observed then the Landlord shall
protect, indemnify and hold the Tenant harmless and shall pay all costs,
expenses and reasonable legal fees incurred or paid by the Tenant in connection
with such litigation. Provided that the Landlord shall have a reasonable period
of time to carry out any maintenance, repair or replacement provided for under
any provision of this Lease.
SECTION 10.08 LANDLORD'S INSURANCE
The Landlord shall effect and maintain throughout the Term the
Following insurance:-
(A) insurance on the Complex excluding any property which the Tenant and
other tenants are obliged to insure pursuant to section 10.01 or
similar provisions in their respective leases in such form, such
amounts and with such deductions as would be carried by a prudent owner
of similar premises;
(B) comprehensive general liability insurance against claims for death,
personal injury and property damage with respect to the Landlord's
operations in the Complex in such reasonable amounts with such
reasonable deductions as would be carried by a prudent owner of
reasonably similar buildings;
(C) rental income insurance where such loss is attributable to all perils
insured against by the Landlord and commonly insured against by prudent
Landlords; and
(D) such other form or forms of insurance as the Landlord or mortgagee may
require.
Notwithstanding any contribution by the Tenant to the Landlord
for insurance premiums as may be provided in this Lease, no insurable interest
is conferred upon the Tenant under policies carried by the Landlord and the
Tenant shall have no right to receive any proceeds of insurance policies carried
by the Landlord. No contribution by the Tenant shall be deemed or construed as
an automatic waiver of subrogation by the Landlord against the Tenant. Further,
the Landlord shall in no way be accountable to the Tenant regarding the use of
any insurance proceeds arising from any claim and the Landlord shall not be
obliged to account for such proceeds.
ARTICLE XI
DAMAGE AND DESTRUCTION
SECTION 11.01 DESTRUCTION OF LEASED PREMISES
If the Leased Premises are at any time damaged or destroyed as a
result of any casualty required to be insured against by the Landlord pursuant
to Section 10.07, or otherwise insured against by the Landlord and not caused by
the Tenant and in the further event that this Lease has not been terminated as
hereinafter provided, the Landlord shall with reasonable diligence repair the
Leased Premises save and except repairs to Leasehold Improvements with respect
to which the Tenant is obliged to insure pursuant to Section 10.01, which repair
shall be the responsibility of the Tenant and (a) if the damage or destruction
is such as to render the Leased Premises wholly unfit for occupancy, Basic Rent
shall abate from the date of the occurrence thereof until the completion of
repairs to the Leased Premises by the Landlord or (b) if the damage or
destruction is such that the Leased Premises can be partially used by the
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Tenant, Basic Rent shall abate in the proportion that the part of the Leased
Premises which cannot be used or occupied bears to the whole of the Leased
Premises from the date of the occurrence of the damage until the completion of
repairs to the Leased Premises by the Landlord.
Provided that in the event the Leased Premises are damaged or
destroyed to such an extent that, in the opinion of the Landlord's architect or
engineer, the same shall not be capable with due diligence of being repaired,
restored or rebuilt within one hundred and twenty (120) days from the date of
such damage or destruction, the Landlord or the Tenant may at its option
terminate this Lease by giving to the other within fifteen (15) days after the
receipt of such architect or engineer's opinions a notice of termination and the
Tenant shall thereupon immediately surrender the Leased Premises and its Lease
to the Landlord and Rent shall be apportioned and paid to the date of such
damage or destruction.
Notwithstanding the foregoing if more than 50% of the Complex has
been destroyed by any cause whether or not the Leased Premises are damaged or
destroyed then the Landlord or the Tenant may, upon written notice to be given
to the other of them, within fifteen (15) days of such destruction, terminate
the Lease, and the Tenant shall immediately surrender the Leased Premises and
this Lease to the Landlord and Rent shall be apportioned to the date of such
damage or destruction.
SECTION 11.02 NOTICE BY THE TENANT
The Tenant shall give immediate notice to the Landlord of any
fire, accident or defect in the Leased Premises, the Complex or anything
connected therewith, but unless otherwise expressly provided herein there shall
be no obligation of the part of the Landlord to repair or make good any such
matters.
SECTION 11.03 WHERE NO INSURANCE PROCEEDS
Notwithstanding the provisions of Section 11.01 hereof, in the
event of damage or destruction occurring by reason of any cause in respect of
which there are no proceeds or insurance, or no proceeds or insurance
substantially sufficient to pay for the costs of rebuilding or making fit the
Complex or the Leased Premises, or no proceeds of insurance payable to or
received by the Landlord, or in the event that any mortgagee or other person
entitled thereto shall not consent to the payment to the Landlord of the
proceeds of any insurance policy for such purpose, the Landlord or the Tenant
may terminate this Lease on fifteen (15) days written notice to the other of
them and the Tenant shall surrender the Leased Premises to the Landlord on the
15th day after such written notice and Rent shall be apportioned to the date of
such surrender.
ARTICLE XII
DEFAULT OF TENANT
SECTION 12.01 RIGHT TO RE-ENTER
If and whenever:-
(A) the Tenant fails to pay Rent or other sums due hereunder or any part
thereof on the 10th day following the day after receipt of notice of
default; or
(B) the Tenant fails to keep, observe or perform any other of the terms,
conditions, covenants and agreements herein contained on the part of
the Tenant to be kept, observed or performed for thirty (30) days after
receipt of notice in writing of such failure has been given to the
Tenant and such failure has not been cured provided that if such
failure is not capable of being cured within such thirty (30) day
period, but the Tenant has commenced and is diligently pursuing the
cure of such failure, then, the Tenant shall have such longer time to
cure such failure as is reasonable; or
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(C) the Tenant becomes bankrupt or insolvent or takes the benefit of any
act now or hereafter in force for bankrupt or insolvent debtors or
files any proposal or makes any assignment for the benefit of
creditors; or
(D) a receiving order is made against the Tenant; or
(E) a receiver or a receiver and manager is appointed for all or a portion
of the property of the Tenant; or
(F) any steps are taken or any action or proceedings are instituted by the
Tenant or by any other party including, without limitation, any court
or governmental body of competent jurisdiction for the dissolution,
winding up or liquidation of the Tenant or its assets; or
(G) the Tenant makes a sale in bulk other than a bulk sale made to a
Transferee pursuant to a permitted Transfer hereunder and pursuant to
the Bulk sales Act of Ontario; or
(H) the Tenant assigns or encumbers the whole or any part of this Lease or
sublets or suffers or permits the use or occupation by anyone of the
whole or any part of the Leased Premises except in the manner permitted
by this Lease; or
(I) the Term hereby granted or any of the Tenant's assets shall be taken in
execution or in attachment or if a writ of execution shall issue
against the Tenant and not be satisfied within thirty (30) days; or
(J) re-entry is permitted under any other terms of this Lease;
then and in any of such cases, at the option of the Landlord, the full
amount of the current month's Rent and Additional Rent and the next
ensuing three (3) months' Basic Rent and Additional Rent shall
immediately become due and payable and the Landlord may immediately
distrain for the same, together with any arrears then unpaid, and the
Landlord shall have, in addition to any other rights or remedies of the
Landlord pursuant to this Lease or at law or in equity, the immediate
right to re-enter into and upon and take possession of the Leased
Premises or any part thereof in the name of the whole and have again,
re-possess and enjoy the Leased Premises in its former estate, and to
expel all persons from the Leased Premises and to remove and store all
property in a public warehouse or elsewhere at the cost and for the
account of the Tenant, all without service of notice or resort to legal
process and without the Landlord becoming liable for any loss or damage
which may be occasioned thereby.
SECTION 12.02 RIGHT TO RE-LET
If and whenever the Landlord shall be entitled to re-enter, the
Landlord may from time to time without terminating this Lease enter the Leased
Premises as the agent of the Tenant either by force or otherwise, without being
liable for any prosecution therefor, and make such alterations and repairs as
are necessary in order to re-let the Leased Premises or any part thereof for
such term or terms which may extend beyond the then current initial Term or
extension period and at such Rent and upon such other terms, covenants and
conditions as the Landlord in its sole discretion considers advisable. Upon each
such reletting all Rent received by the Landlord from such reletting shall be
applied, firstly to the payment of any indebtedness other than Rent due
hereunder from the Tenant to the Landlord, secondly, to the payment of any costs
and expenses of such reletting including brokerage fees and solicitors' fees
and the cost of alterations and repairs, thirdly, to the payment of Rent due
hereunder, and to residue, if any, shall be held by the Landlord and applied in
payment of future Rent as the same become due and payable hereunder and the
Landlord shall not be accountable for any monies except those actually received
notwithstanding any act, neglect, omission or default of the Landlord unless
such non-receipt results from the negligence of the Landlord or those for whom
it is in law responsible. No such entry in the Leased Premises by the Landlord
shall be construed as an election of its part to terminate this Lease unless a
written notice of termination is given to the Tenant. Notwithstanding any such
re-letting without termination,, the Landlord may at any time
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thereafter terminate this Lease for such previous breach by written notice of
termination given to the Tenant.
SECTION 12.03 WAIVER OF EXEMPTION FROM DISTRESS
The Tenant hereby waives and renounces the benefit of any present
or future statute taking away or limiting the Landlord's right of distress, and
covenants and agrees that notwithstanding any such statute none of the goods and
chattels of the Tenant on the Leased Premises at any time during the Term or any
extension or renewal thereof shall be exempt from levy by distress for Rent
and/or accelerated 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 Lease
may be pleaded as an estoppel against the Tenant in any action brought to test
the right to the levying upon any such goods or chattels as are named as
exempted in any such statute.
SECTION 12.04 PARTIES MAY CURE DEFAULT
If the Tenant is in default of any obligation or covenant under
this Lease, the Landlord shall have the right at all times to remedy or attempt
to remedy any such default by the Tenant, and in so doing may make any payments
due by the Tenant to third parties and may enter upon the Leased Premises to do
any work or other things therein, and in each such event all expenses of the
Landlord in remedying or attempting to remedy such default shall be payable as
Additional Rent by the Tenant to the Landlord forthwith upon demand, and the
Landlord shall not be liable for any loss or damage to the Tenant's property or
business caused by the reasonable acts of the Landlord in remedying or
attempting to remedy any such default, and the Tenant agrees that any such entry
by the Landlord is not a re-entry or a breach of any covenant for quiet
enjoyment contained in this Lease.
If the Landlord is in default of any material obligation or
covenant under this Lease for a period of twenty (20) days after written notice
from the Tenant, the Tenant shall have the right at all times to remedy such
default by the Landlord,and the expenses thereof shall be claimable by the
Tenant from the Landlord and the Tenant shall not be liable for any loss or
damage to the Landlord's property or business caused by the reasonable acts of
the Tenant in remedying any such default.
SECTION 12.05 NO WAIVER OF BREACH
No condoning, excusing or overlooking by the Landlord of any
default, breach or non-observance by the Tenant at any time or times in respect
of any covenants, provisos or conditions herein contained shall operate as a
waiver of the Landlord's rights hereunder in respect of any continuing or
subsequent default, breach or non-observance, or so as to defeat or affect such
continuing or subsequent default or breach, and no waiver shall be inferred from
or implied by anything done or omitted by the Landlord save only an express
waiver in writing.
SECTION 12.06 REMEDIES CUMULATIVE
No reference to, nor exercise of, any specific right or remedy by
the Landlord shall prejudice or preclude the Landlord from any other remedy in
respect thereof, whether allowed at law or in equity unless expressly provided
for herein. No such remedy shall be exclusive or dependent upon any other such
remedy, but the Landlord may from time to time exercise any one or more of such
remedies independently or in combination.
SECTION 12.07 ACCORD AND SATISFACTION
No payment by the Tenant or receipt by the Landlord of a lesser
amount than the monthly Basic Rent and any Additional Rent herein stipulated
shall be deemed to be other than on account of the earliest stipulated Basic
Rent or Additional Rent or both, nor shall any endorsement or statement on any
cheque or any letter accompanying any cheque for or on account of payment of
Basic Rent or Additional Rent be deemed an accord and satisfaction, and the
Landlord may accept such cheque or payment without prejudice to the Landlord's
right to recover the balance of such Basic Rent or Additional Rent or pursue any
other remedy in this Lease provided.
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SECTION 12.08 LANDLORD'S EXPENSES
In any of the events referred to in section 12.01 hereof, the
Tenant shall pay and indemnify the Landlord against all costs, expenses
including reasonable legal fees on a solicitor-client basis and charges lawfully
and reasonably incurred in enforcing payments of Rent or other sums due
hereunder, or in obtaining possession of the Leased Premises after default of
the Tenant or upon expiration or earlier termination of the Term, or in
enforcing any covenant, proviso or agreement of the Tenant herein contained. All
Rent in arrears and all sums paid by the Landlord for expenses incurred which
should have been paid by the Tenant shall bear interest from the date payment
was due, or made, or expense incurred at a rate of twelve per cent (12%) per
annum until paid.
ARTICLE X111
SALE OR MORTGAGE BY LANDLORD
SECTION 13.01 CONVEYANCE BY LANDLORD
In case the Landlord shall convey or otherwise dispose of the
Leased Premises or the Complex or any part thereof to a purchaser or assignee
who shall agree to assume the obligations of the Landlord herein, all
liabilities and obligations on the part of the Landlord accruing after such
conveyance or disposal shall terminate upon such conveyance or disposal and
thereupon all such liabilities and obligations shall be binding only upon the
Landlord's successors and assigns as the case may be.
SECTION 13.02 SUBORDINATION
The Tenant covenants and agrees with the Landlord that this Lease
is and all of the rights of the Tenant hereunder are subject and subordinate to
the rights of any mortgagee and at any time and from time to time at the request
of the Landlord or a mortgagee the Tenant shall promptly execute and deliver any
instrument or further assurance reasonably required to:-
(A) postpone and subordinate this Lease to such mortgagee to the intent and
effect that this Lease and all rights of the Tenant hereunder shall be
subject to the rights of such mortgagee as though the same existed
prior to the making of this Lease; and
(B) attorn to the mortgagee and become bound to the mortgagee as Tenant of
the Leased Premises for the then unexpired residue of the Initial Term
or extension period as the case may be and upon the conditions herein
contained.
The Tenant shall not be required to subordinate the Lease unless
the mortgagee executes a non-disturbance agreement in favour of the Tenant, such
agreement to be in form acceptable to the Tenant and the mortgagee acting
reasonably.
Landlord shall obtain a non-disturbance agreement from any
existing and future mortgagee in a reasonably acceptable form to Tenant and
mortgagee.
SECTION 13.03 ESTOPPEL CERTIFICATE
Whenever requested by the Landlord the Tenant shall promptly, and
in any event within ten (10) days execute and deliver a certificate in form
satisfactory to the Landlord, in favour of any actual or prospective purchaser
or mortgagee of the Landlord's interest, certifying as to the status and
validity of this Lease and the state of the rental account hereunder and such
other information as may reasonably be required, all with the intent that any
such certificate may be relied upon by the party to whom it is addressed.
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SECTION 13.04 TENANT NOT TO CREATE ENCUMBRANCES
The Tenant shall not create or permit or allow any mortgage,
charge or other encumbrance of its leasehold interest under this Lease and its
interest in the Leased Premises unless the prior written consent of the Landlord
has been obtained which consent, in the absolute discretion of the Landlord, may
be unreasonably withheld or granted on such terms and conditions as the Landlord
may see fit.
ARTICLE XIV
ACCESS
SECTION 14.01 RIGHT OF ENTRY
The Landlord and its agents shall have the right at all
reasonable times during the continuance of this Lease to enter upon the Leased
Premises to show then to prospective purchasers and mortgagees on 24 hours prior
written notice and, in addition the Landlord and its agent shall have the right
at all reasonable times during the six (6) months prior to the termination of
this Lease, on 24 hours prior written notice to enter upon the Leased Premises
to show them to prospective tenants. The Landlord shall also be permitted at any
time and from time to time to enter and to have its authorized agents, employees
and contractors enter the Leased Premises for the purpose of inspection,
maintenance, performing of janitorial services including heater ducts and access
panels which the Tenant agrees not to obstruct and the Tenant shall provide free
and unhampered access for the purpose and shall not be entitled to compensation
for any inconvenience, nuisance or discomfort caused thereby. If the Tenant is
not personally present to open and permit an entry into the Leased Premises, at
any time, when for any reason an entry therein is necessary or permissible, the
Landlord or its agents may forcibly, at the Landlord's expense, enter the same,
without in any manner affecting the obligations or covenants of this Lease.
Nothing herein contained, however, is deemed or construed to impose upon the
Landlord any obligation, responsibility or liability whatsoever for the care,
maintenance or repair of the Leased Premises, or any part thereof, except as
otherwise herein specifically provided. The Tenant agrees that any entry by the
Landlord upon the Leased Premises in accordance with this Section is not a
re-entry or a breach of any covenant for quiet enjoyment contained in this
Lease.
SECTION 14.02 SALE AND RENTAL NOTICES
The Landlord shall have the right at all times during the
continuance of this Lease to place upon the Leased Premises a notice of
reasonable dimensions and reasonably placed so as not to interfere with the
business of the Tenant stating that the Complex is for sale, and, in addition,
the Landlord shall have the right at all times during the six (6) months prior
to the termination of this Lease to place upon the Leased Premises a similar
notice that the Leased Premises are for rent and the Tenant will not remove any
such notice or knowingly permit the same to be removed.
ARTICLE XV
COMMON AREAS
SECTION 15.01 CONTROL OF COMPLEX BY THE LANDLORD
The Landlord shall operate and maintain the Complex in a
reasonably commercial standard as is the custom in the city of Cornwall. It is
acknowledged and agreed that the Complex and the Common Areas and Facilities are
at all times subject to the exclusive control and management of the Landlord.
SECTION 15.02 RULES AND REGULATIONS
The Tenant acknowledges and agrees that the Landlord shall have
the right to promulgate reasonable rules and regulations not inconsistent with
the terms of this Lease to
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regulate the use of the Common Areas and Facilities including, without limiting
the generality of the foregoing, the regulation of parking in any parking areas,
provided the Tenant is given prior written notice of such rules. The Tenant
agrees that such rules and regulations shall form a part of this Lease and shall
be binding upon the Tenant provided that nothing herein contained shall require
or be deemed to require the Landlord to promulgate any such rules or regulations
or to regulate in any manner whatsoever the use of the Common Areas and
Facilities, and parking area and facilities.
SECTION 15.03 USE OF COMMON AREAS
The Tenant, its employees, invitees and customers and persons
doing business with the Tenant shall have the right, in common, with others
entitled thereto from time to time to use the driveways, walkways, lawns if any,
ramps and other Common Area and Facilities as may be from time to time
designated by the Landlord for the use of or benefit of such persons for the
purpose of ingress to and egress from the Leased Premises. The Tenant shall not
block or in any manner hinder the Landlord or other tenants or persons claiming
through or under them utilizing the Common Areas and Facilities. The Landlord
reserves the right to restrict the use of or close any parking areas or any
other portion of the Common Areas and Facilities to prevent the acquisition of
prescriptive rights by any party or parties. Notwithstanding the foregoing the
Tenant shall at all times have access for itself and is customers both to
Vincent Massey Drive.
SECTION 15.04 ALTERATIONS TO THE COMMON AREAS
Notwithstanding anything to the contrary contained herein, the
Landlord shall have the right to make such changes and improvements or
alterations as the Landlord may from time to time, in its absolute discretion,
determine in respect of the Common Areas and Facilities or any part thereof
including but not limited to the walkways, parking areas, driveways and all
other erections thereon including the right to change the size thereof, erect
buildings thereon or sell or lease parts thereof,so long as the Leased Premises
and its number of parking spaces are not interfered with or reduced in size.
ARTICLE XVI
MISCELLANEOUS
SECTION 16.01 NET LEASE
The Tenant acknowledges and agrees that this Lease shall, except
as otherwise provided for herein, be a net Lease for the Landlord and that the
Tenant shall pay for its own account and to the complete exoneration of the
Landlord all costs, expenses, charges or outlays of any kind arising from,
relating to or affecting the Leased Premises except all amounts specifically
payable by the Landlord or recoverable from third parties pursuant to the terms
thereof, any payments of principal and interest to be made under any mortgage
placed or assumed by the Landlord and the payment of the Landlord's income
taxes, capital taxes or corporation taxes, unless such income, capital or
corporation taxes have been imposed in lieu of or substitution for Taxes.
SECTION 16.02 SIGNS
The Tenant, shall have the right to install a sign or signs upon
the exterior of the Leased Premises subject to compliance with municipal by-laws
and subject to the prior written consent of the Landlord, which consent shall
not be unreasonably or arbitrarily withheld or delayed. Upon completion of the
Term or any earlier termination thereof, at the request of the Landlord, the
Tenant agrees to remove any sign which has been installed, erected or displayed
in or about the Leased Premises. Such removal will be at the cost of the Tenant.
Failure of the Tenant to remove same at the request of the Landlord shall
entitle the Landlord to remove such sign at the cost of the Tenant, and the
Tenant shall pay such cost together with an additional administrative charge of
five percent (5%) to the Landlord as Additional Rent. The Tenant, subject to the
availability of space and to the prior approval of the Landlord which consent
shall
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not be unreasonably or arbitrarily withheld or delayed as to terms and
conditions, may display its signage on the existing pylon sign at the Complex.
SECTION 16.03 FORCE MAJEURE
If any party hereto is bona-fide delayed or hindered in or
prevented from the performance of any provisions of this Lease by causes beyond
its reasonable control but not including any lack of funds or other financial
cause of delay, then the performance of the provision of this Lease so delayed,
hindered or prevented shall be excused for the period during which such
performance is rendered impossible and the time for such performance shall be
extended accordingly; provided, however, that nothing herein contained shall
operate in any way to excuse the Tenant from the prompt payment of Rent or any
other payments required by this Lease.
SECTION 16.04 BINDING EFFECT
In the event of a sale, transfer or lease by the Landlord of the
Complex or assignment by the Landlord of this Lease or any interest of the
Landlord's hereunder, and to the extent that such purchaser, transferee, lessee
or assignee has become bound by the covenants and obligations of the Landlord
hereunder, the Landlord shall, thereupon and without further agreement, be
freed, released and relieved of all liability upon such covenants and
obligations.
Subject to the foregoing and to the provisions of this Lease
respecting assignment by the Tenant, this Lease shall be binding upon and shall
enure to the benefit of the parties hereto and their respective heirs,
executors, administrators, successors and assigns.
SECTION 16.05 CONSTRUCTION
Each obligation or agreement of the Landlord or the Tenant
expressed in this Lease, even though not expressed as a covenant, is considered
to be a covenant for all purposes. The words "hereinafter", "hereof", "hereby",
"hereunder", "hereto", "hereinafter" and similar expressions refer to this Lease
and not to any particular article, section, paragraph or other portion thereof,
unless there is something in the subject matter or context inconsistent
therewith. Any reference to "Tenant" includes, where the context allow, the
servants, employees, agents, invitees and licensees of the Tenant and anyone
permitted to be in the Complex or on the Lands by the Tenant, and all others
over whom the Tenant may reasonably be expected to exercise control. All rights
and privileges of the Landlord in this Lease may be exercised by the Landlord
and its duly authorized representatives. Wherever the singular number or a
gender is used in this Lease the same shall be construed as including the plural
and the masculine, feminine and neuter respectively where the fact or context so
requires.
SECTION 16.06 CAPTIONS
The captions or headings introducing articles or sections of this
Lease are for convenience of reference only and in no way define, limit,
construe or describe the scope or intent of such articles or sections of this
Lease nor in any way affect the interpretation of this Lease.
SECTION 16.07 SEVERABILITY
If any term, provision, covenant, or condition of this Lease or
its application to any person or circumstance is held to be or rendered invalid,
unenforceable or illegal, then such term, provision, covenant or condition shall
be considered separate and severable from the remainder of this Lease, shall not
affect, impair or invalidate the remainder of this Lease, and to the fullest
extent permitted by law shall continue to be applicable to and enforceable
against any person or circumstance other than those as to which it has been held
or rendered invalid, unenforceable or illegal.
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SECTION 16.08 ENTIRE AGREEMENT
This Lease and the schedules and riders, if any, attached hereto
and forming a part hereof, constitute the entire agreement between the Landlord
and Tenant and, except as herein otherwise expressly provided, may be amended
only by an agreement in writing signed by them. Neither the Landlord nor the
Tenant shall be bound by any representations, warranties, promises, agreements
or inducements not embodied or referred to in this Lease and, in particular but
without limitation, no warranties of the Landlord are to be implied unless
expressed specifically in this Lease.
SECTION 16.09 REGISTRATION
The Tenant shall not register this Lease without the prior
written consent of the Landlord. In lieu of giving consent, the Landlord shall
execute, at the request and expense of the Tenant, a Notice of Lease in a form
reasonably satisfactory to the Landlord for the purposes of registration, which
shall suffice to give notice of this Lease and the Tenant's interest in the
Leased Premises without disclosure of any of the terms of this Lease which the
Landlord does not wish to have disclosed.
SECTION 16.10 NOTICES
Any notice required or contemplated by any provision of this
Lease shall be in writing and shall be given by personal service, telecopier or
by fax, or by mailing by registered mail, with postage thereon fully prepaid, in
a sealed envelope, to be addressed to each party at the following address:
To the Tenant at:
the Leased Premises
To the Landlord at:
649 Second Street East
Cornwall, Ontario
K6H 1Z7
Fax 1-613-938-3295
To the Guarantor at:
237 22nd Street
Greeley, Colorado
USA 80631
Fax 1-303-388-9970
Either party may, by notice in writing advise of a new address
for notice, which shall then be used by the party to whom it is addressed.
Any such notice delivered personally or by telecopier or by fax
in accordance herewith shall be deemed to have been received by and given to the
addressee on the day of delivery or transmission. Any notice mailed as aforesaid
shall be deemed to have been received by and given to the addressee on the third
business day following the date of mailing, provided that for such purposes no
day during which there shall be a strike or other occurrence which shall
interfere with normal mail service shall be considered a business day. If at any
time during the Term or any extention or renewal thereof the Tenant or the
Guarantor do not provide a current fax number to the Landlord, the parties agree
that the Landlord shall be entitled to give any notice required or contemplated
by any provision of this Lease to be given to the Tenant and/or to the Guarantor
by delivery thereof at the Leased Premises.
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SECTION 16.11 GOVERNING LAW
This Lease shall be construed in accordance with and governed by
the laws of the laws of the Province of Ontario.
SECTION 16.12 TIME
Time is of the essence of this Lease and of every part thereof.
SECTION 16.13 PLANNING ACT
This Lease is entered into subject to the conditions and
provisions of the Planning Act, R.S.O. Chpt.P.13 as amended.
SECTION 16.14 GOODS AND SERVICES TAX
In addition to the Rent, Additional Rent and any other amounts to
be paid by the Tenant to the Landlord under any provisions of this Lease, the
Tenant shall pay to the Landlord (acting as agent for the taxing authority if
applicable) or directly to the taxing authority (if required by the applicable
legislation) in a manner specified by the Landlord, the full amount of all Goods
and Services taxes, Sales Taxes, or taxes of like effect whether value added
taxes, multi-stage taxes, business transfer taxes and other taxes imposed on the
Tenant in respect of the amounts payable by the Tenant under this Lease
(collectively and individually in this paragraph referred to as G.S.T.).
SECTION 16.15 PARKING
The Tenant shall be entitled to the non-exclusive use of those
portions of the existing parking lot in the Complex as outlined in yellow on
Schedule "B". The Landlord covenants that such areas shall comprise a minimum of
three hundred seventy-three (373) parking spaces after the parking lot in the
Complex as outlined in yellow on Schedule "B" is reconfigured. The
reconfiguration of the parking lot shall be carried out by the Landlord,
according to a reconfiguration plan agreed upon by the Tenant and Landlord. The
reasonable costs of such reconfiguration incurred by the Landlord shall
constitute Costs of Operation of the Complex. The Tenant covenants that it shall
use its reasonable efforts to not allow its employees to park their vehicles in
parking ares of the Complex other than the area outlined in yellow on Schedule
"B". The Landlord agrees that throughout the Term and renewal or extention
thereof, no charges shall be levied for the use of the parking areas (other than
the Tenant's proportionate share of the Costs of Operation, Taxes and other
Additional Rent applicable to such areas).
SECTION 16.16 HOURS OF OPERATION.
The Tenant may conduct its business operations twenty four (24)
hours per day seven (7) days a week; provided however that this shall not be
construed as a continuous operation covenant on the part of the Tenant.
SECTION 16.17 RIGHT OF RELOCATION
The Landlord shall not have the right to relocate the Leased
Premises during the Term of the Lease or any renewal or extention thereof.
SECTION 16.18 BACK UP POWER
The Tenant shall have the right to install an emergency diesel
generator in an exterior location mutually agreed upon by the Landlord and the
Tenant. The Tenant shall be responsible for all costs in connection with such
installation; provided however that the Landlord shall not charge the Tenant any
Basic Rent for the area of the Complex occupied by
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the generator. The generator shall remain the property of the Tenant at the
expiration or other termination of this Lease.
SECTION 16.19 COUNTERPART SIGNATURES
This Agreement may be executed in counterparts each of which
shall be deemed an original but all of which together shall constitute but one
and the same instrument.
SECTION 16.20 AUTHENTICITY OF FACSIMILE SIGNATURES
This Agreement may be executed and sent by a party to the other
parties by way of facsimile transmission and such facsimile transmission may be
relied upon by the other parties as if the facsimile transmission was an
original duly signed by the sending party.
ARTICLE XVII
QUIET ENJOYMENT
SECTION 17.01 QUIET ENJOYMENT
The Landlord covenants with the Tenant for quiet enjoyment;
provided, however, that nothing contained in this covenant, or otherwise in this
Lease, shall be construed as a warranty by the Landlord to the Tenant as against
any adverse claims, encumbrances or defects in title to the Leased Premises
existing before the Landlord acquired title, or asserted by persons claiming by,
from or under any predecessor in title to the Landlord.
ARTICLE XVIII
EXPROPRIATION
SECTION 18.01 EXPROPRIATION
If the whole or any part of the Complex or the Lands shall be
taken or expropriated during the Term or any extension or renewal thereof,
neither the Landlord nor the Tenant shall have a claim against the other for the
shortening of the Term or potential term of this Lease, the abatement of Rent or
the reduction or alteration of the Leased Premises and the Landlord and Tenant
may each exercise fully all rights, remedies and claims for compensation which
each may have under the applicable expropriation legislation and this Lease
shall not terminate nor Rent abate except to the extent that the applicable
expropriation legislation may mandatorily require.
SECTION 18.02 RECONSTRUCTION
If as a result of any partial expropriation or taking of the
Complex or the Lands it becomes necessary to reconstruct or alter so much of the
Complex in order that the remaining portions thereof may be used and operated as
a practical and economic unit, then the provisions of Article XI shall apply to
such reconstruction or alteration.
SECTION 18.03 CLAIMS FOR COMPENSATION
The Landlord and the Tenant shall inform each other fully of the
claims for compensation made by each of them in the event of any expropriation
and shall not claim compensation on any basis inconsistent with this Lease and
shall afford reasonable co-operation to each other in the prosecution of any
proper separate claims.
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ARTICLE XIX
OPTION TO RENEW
SECTION 19.01 OPTION TO RENEW
The Tenant, provided it is not in default hereunder, shall have
the option to renew the term of this Lease for two further terms of five (5)
years each, providing the Tenant gives at least six (6) months and not more than
nine (9) months prior to the expiration of the current Term, or the first
renewed term, as the case may be, written notice of its intention to renew to
the Landlord. The first renewed term shall be subject to the same covenants,
terms and conditions as contained herein, save and except for the annual Basic
Rent, which shall be six dollars and fifty cents ($6.50) per square foot.
The second renewed term shall be subject to the same covenants,
terms and conditions as contained herein, save and except for the annual Basic
Rent, which shall be seven dollars ($7.00) per square foot.
The Tenant shall have no further right of renewal.
ARTICLE XX
GUARANTEE
SECTION 20.01 GUARANTEE
In order to induce the Landlord to enter into the foregoing Lease
and for other good and valuable consideration, the receipt and sufficiency
whereof is hereby acknowledged, the Guarantor hereby covenants with and in
favour of the Landlord as follows:-
The Guarantor hereby agrees with the Landlord that at all times
during the Term and any extension or renewal thereof only subject to the
provisions of this Lease the Guarantor will:-
(A) make the due and punctual payment of all Basic Rent, Additional Rent,
monies, charges, and other amounts of any kind whatsoever payable under
the Lease by the Tenant whether to the Landlord or otherwise;
(B) effect prompt and complete performance of all and singular the terms,
covenants, conditions, agreements and provisions in the Lease contained
on the part of the Tenant to be kept, observed and performed; and
(C) indemnify and save harmless the Landlord from any and all losses,
costs, damages or expenses arising out of any failure by the Tenant to
pay the aforesaid Basic Rent, Additional Rent, money, charges or other
amounts due under the Lease or resulting from any failure by the Tenant
to observe or perform any of the terms, covenants, conditions,
agreements and provisions contained in this Lease.
This guarantee is absolute and unconditional and the obligations
of the Guarantor shall not be released discharged, mitigated, impaired or
affected by:-
(D) any extensions of time. indulgences or modifications which the Landlord
extends to or makes with the Tenant in respect of the performance of
any of the obligations of the Tenant under the Lease;
(E) any waiver by the Landlord or failure of the Landlord to enforce any of
the terms, covenants, conditions, agreements and provisions with the
Tenant under this Lease;
(F) any assignment of the Lease by the Tenant or by any trustee, receiver
or liquidator, provided the terms of this Lease are not amended;
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(G) any consent which the Landlord gives to any such assignment or
subletting;
(H) any amendment to the Lease or any waiver by the Tenant of any of its
rights under the Lease; or
(I) the expiration of the Term or any extension or renewal term.
The Guarantor hereby expressly waives notice of non-payment,
non-performance or non-observance on the part of the Tenant of the terms,
covenants, conditions, agreements and obligations contained in the Lease.
In the event of a default under the Lease or under this
guarantee, the Guarantor waives any right to require the Landlord to :-
(J) proceed against the Tenant or pursue any rights or remedies against the
Tenant with respect to the Lease;
(K) proceed against or exhaust any security of the Tenant held by the
Landlord; or
(L) pursue any other remedy whatsoever in the Landlord's power.
No modification of this guarantee shall be effective unless the
same is in writing and is executed by both the Guarantor and the Landlord.
The Guarantor shall, without limiting the generality of the
foregoing, be bound by this guarantee in the same manner as though he was the
Tenant named in the Lease.
If there is more than one Guarantor named in the Lease herein the
obligations of each and every one of such Guarantors shall be joint and several.
IN WITNESS WHEREOF the parties hereto have executed this Lease.
OGT HOLDINGS LTD.
/s/ Icaro Olivieri
-----------------------------------------
Per: Icaro Olivieri
I have authority to bind the Corporation
STARTEK CANADA SERVICES, LTD.
/s/ E. Preston Sumner, Jr.
-----------------------------------------
Per: E. Preston Sumner, Jr.
-----------------------------------------
Per:
I have authority to bind the Corporation
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STARTEK USA, INC.
/s/ E. Preston Sumner, Jr.
-----------------------------------------
Per:
-----------------------------------------
Per:
We have authority to bind the Corporation
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SCHEDULE "A"
LEGAL DESCRIPTION
FIRSTLY:
Part of Lot 13, Concession 2, parts of Demontigny Street, parts of Lots 13, 16,
17, 18 , 19, 20, 21, 22, and all of Lots 14 and 15, Plan 197, City of Cornwall,
County of Stormont and shown as Parts 1, 2, 4 and 5 on Plan of Reference No.
52R-2516 registered in the Registry Office of the Registry Division of Stormont
(No. S2).
SUBJECT TO an easement over Part 2 on Plan 52R-2616
TOGETHER WITH a right to the Transferee its successors and assigns over Part 3
on Plan 52R-2616.
SECONDLY:
Part of Lot 13, Second Concession, City of Cornwall, County of Stormont, more
particularly described as follows:
PREMISING that the bearing hereinafter mentioned are astronomic, and are
referred to the meridian through the International Boundary Monument No. 11,
Cornwall Township;
COMMENCING at a standard iron bar planted in the southern limit of Vincent
Massey Drive as shown in instrument No. 1126 for the Township of Cornwall, on
File in the Registry Office for the said County, distant 488.61 feet measured
westerly thereon from the western limit of Demontigny Street as shown on
Registered Plan No. 157 on file in the said Registry Office;
THENCE south 34 degrees 33 minutes 15 seconds west, a distance of 254.14 feet to
an iron bar;
THENCE easterly, along the said southern limit of Vincent Massey Drive, being a
circular curve to the right having a radius of 2, 814.79 feet, the chord of
which had a length of 349.77 feet measured on bearing of south 73 degrees 21
minutes 17 seconds east, a distance of 350 feet (arc measurement) to the point
of commencement,
Which said parcel contains by admeasurement 1,000 acres, be the same, more or
less, as is shown outlined in red on the Plan of Survey signed by L.P. Stidwell,
O.L.S., dated December 21, 1996, attached to Instrument No. 46115.
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Schedule "B"
SITE-PLAN OF
PART OF LOT 13, CONCESSION 2
PART OF DEMONTIGNY STREET
LOTS 14 AND 15, AND PART OF LOTS 13, 16 TO 22 (INCLUSIVE)
REGISTERED PLAN No. 157
(FORMERLY IN THE TOWNSHIP OF CORNWALL)
CITY OF CORNWALL
COUNTY OF STORMONT
- GRAPHIC -
Surveyors Geographical Map of Lot Location
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SCHEDULE "C"
NON-PERMITTED USES
SEAWAY SHOPPING CENTER
1. operating a Flea Market
2. the sale of Pet food and/or pet supplies
3. operating a pinball or video arcade
4. that would tend to attract illegal traffic or narcotic drugs
5. involving nudity or partial nudity
6. operating a supermarket
7. the sale at retail of milk, bread, canned goods, groceries, fresh or
frozen fruits or vegetables, fresh, frozen and packaged meats, ice
cream in containers or other diary products
8. a movie theatre or cinema or bowling alley
9. a Department store
10. a junior department store of any operation similar to a Bi Way
operation on the commencement date of the Bi Way lease with respect to
merchandise, quality, and more display
11. operating a Mens' and Ladies' Hairdressing Salon
12. a sit-down restaurant, or of a fast-food counter, or for the selling or
dispensing of meals, lunches and/or prepared foods intended for
immediate consumption in the Complex
13. a sporting goods store
14. operating a Computer store
15. a pharmacy, the sale of alternative medicine, herbal remedies,
prescription medication or any products normally sold by a retail
pharmacy, a medical laboratory, facility for testing of blood
16. a medical walk-in clinic, doctors office, and ancillary uses