THIS INDENTURE made as of the 20th day of April , 2006
IN PURSUANCE OF THE SHORT FORMS OF LEASES ACT
LANDLORD NAME AND ADDRESS
FERCAN DEVELOPMENTS INC.
193 King Street East, Ste. 200
Toronto, ON M5A1J5
Telephone: 416 867 9899
Facsimile: 416 867 9675
GST Registration No.: 89408 9267 RT0001
(the "LANDLORD")
- and -
TENANT NAME AND ADDRESS
NORTHERN ETHANOL (BARRIE) INC.
1 Big Bay Point Road,
BARRIE, ONTARIO
(the "TENANT")
BUILDING AND LAND LOCATED AT : 1 Big Bay Point Road, BARRIE, ONTARIO
GROSS LEASABLE AREA OF BUILDING PREMISES: 350,000 square feet as illustrated in
Schedule "B" attached
LAND AREA : 13 acres of land illustrated in
Schedule "B-1" attached
(the "PREMISES")
Page 1
1 - BASIC TERMS
1.1 - TERM:
Building Premises ( 25 Years)
(a) Commencement Date: November 1, 2006
(b) Expiry of Term: October 30th, 2031
Land Area ( 21 years less 1 day)
(a) Commencement Date: November 1, 2006
(b) Expiry of term: October 30th, 2027
1.2 BASE RENT
1.2 A- BASE RENT FOR BUILDING
PERIOD OF TERM RENT/SQUARE FOOT MONTHLY RENT ANNUAL RENT
------------------------------------------------------------------------------------------------------------
Years 1-1 $ 5.00 $ 145,833.33 $ 1,750,000.00
Years11-15 $ 5.60 $ 163,333.33 $ 1,960,000.00
Years16-20 $ 6.27 $ 182,932.96 $ 2,195,195.52
Years21-25 $ 7.02 $ 204,705.00 $ 2,457,000.00
**Note: Base Rent subject to 7% GST payable with each monthly rental
payment.
1.2B. BASE RENT FOR LAND AREA**
------------------------------- ------------------------- -------------
PERIOD OF MONTHLY RENT ANNUAL RENT
TERM
------------------------------- ------------------------- -------------
Years1-10 $ 43,333.33 $ 520,000.00
Years11-15 $ 48,533.33 $ 582,400.00
Years16-20 $ 54,357.33 $ 652,288.00
**Note: Base Rent subject to 7% GST payable with each monthly rental
payment.
1.3 - TENANT'S ESTIMATED PROPORTIONATE SHARE OF OPERATING COSTS AND REALTY
TAXES:
(a) $3.00 per Sq ft. Estimated Operating Costs and Realty Taxes to be
charged commencing November 1, 2006 and to be reviewed and reconciled
annually.
Estimated Operating Costs and Realty Taxes subject to 7% GST payable with
each monthly rental payment
1.4 - DEPOSIT:
(a) $300,000.00 as a security deposit for the last month of Rent( includes
Base Rent, CAM, Realty Taxes and GST)
1.5 - USE OF PREMISES:
The manufacturing, processing, selling, and distribution of ethanol
for use as an automotive fuel additive and all related, necessary, and
ancillary uses such as office and administration incidental to the primary
use. The Tenant will not use or permit the use of the Premises for the
manufacture or sale of alcohol or any beverage containing alcohol, for
human consumption
The Land Area shall be used for any purpose connected with the
manufacture, processing, selling and distribution of ethanol as an
automotive fuel additive, including installation of and as a location for
equipment and machinery involved in the process of manufacture and
processing ethanol.
Page 2
1.6 - OPTIONS TO EXTEND
(a) If the Tenant is not then in default under the Lease and has not
been in recurrent default under the Lease during the Term, the
Tenant shall have the right on written request delivered to the
Landlord not less than six (6) months prior to the expiry of the
initial Term to extend the Term for the Building Premises for one(1)
further period of ten (10) years ( THE "FIRST EXTENSION TERM") after
the expiry of the initial Term, on the same terms and conditions as
set out in the Lease, save and except for any further option to
extend and Base Rent for the Building Premises. The Base Rent
payable during such Ten (10) year extension shall be the then
current market rent for comparable unfixtured space in the vicinity
of the Building and with similar exposure to Highway 400. If the
parties are unable to agree on the Base Rent for the extended Term
within ninety (90) days prior to the expiry date of the then current
Term, the Tenant shall have the right to submit the issue of the
amount of the Base Rent payable during such first extension Term to
arbitration in accordance with the Arbitrations Act, 1991 (Ontario).
The Base Rent shall in any event be not less than the Base Rent paid
by the Tenant in the twelve (12) months immediately preceding the
expiry date of the Term. The costs of such arbitration shall be
borne equally by both parties. The Tenant shall execute an extension
agreement incorporating the terms and conditions of such extension,
which may be in the form of the Landlord's then current Lease for
the Building. If the Tenant fails or neglects to submit the issue of
the Base Rent payable during such first extension to arbitration
within the aforesaid ninety (90) days, the Tenant shall be deemed
for all purposes of this Lease to have accepted the Base Rent
stipulated by the Landlord.
(b) If the Tenant has exercised the right to the first extension of
the Term as aforesaid and is not then in default under the Lease and
has not been in recurrent default under the Lease during the first
extension of the Term, the Tenant shall have the right on written
request delivered to the Landlord not less than six (6) months prior
to the expiry of the first extension Term to extend the Term for the
Building Premises for one (1) further period of ten(10) years ( the
"SECOND EXTENSION TERM") on the same terms and conditions, save and
except for any further option to extend and Base Rent, which shall
be negotiated. The Base Rent payable during such second extension
Term shall be the then current market rent for comparable unfixtured
space in the vicinity of the Building and with similar exposure to
Highway 400. If the parties are unable to agree on the Base Rent for
the second extension Term within ninety( 90) days prior to the
expiry date of the first extension Term, the Tenant shall have the
right to submit the issue of the amount of Base Rent payable during
such second extension Term to arbitration in accordance with the
Arbitrations Act, 1991 (Ontario). The Base Rent in any event shall
be not less than the Base Rent paid by the Tenant in the twelve (12)
months immediately preceding the expiry date of the first extension
Term. The costs of such arbitration shall be borne equally by both
parties. The Tenant shall execute an extension agreement
incorporating the terms and conditions of such extension, which may
be in the form of the Landlord's then current Lease for the
Building. If the Tenant fails or neglects to submit the issue of the
Base Rent payable during such second extension Term to arbitration
within the aforesaid ninety (90) days, the Tenant shall be deemed
for all purposes of this Lease to have accepted the Base Rent
stipulated by the Landlord.
(c) If the Tenant is not then in default under the Lease and has not
been in recurrent default under the Lease during the Term, the
Tenant shall have the right on written request delivered to the
Landlord not less than six (6) months prior to the expiry of the
initial Term for the Land Area, to extend the Term for the Land Area
for one(1) further period of ten (10) years ( THE " FIRST EXTENSION
TERM") after the expiry of the initial Term, on the same terms and
conditions as set out in the Lease, save and except for any further
option to extend and Base Rent. The Base Rent payable during such
Ten (10) year extension shall be the then current market rent for
comparable unfixtured space in the vicinity of the Building and with
similar exposure to Highway 400.If the parties are unable to agree
on the Base Rent for the extended Term within ninety ( 90) days
prior to the expiry date of the then current Term, the Tenant shall
have the right to submit the issue of the amount of the Base Rent
payable during such first extension Term to arbitration in
accordance with the Arbitrations Act, 1991 (Ontario). The Base Rent
shall in any event be not less than the Base Rent paid by the Tenant
in the twelve (12) months immediately preceding the expiry date of
the Term. The costs of such arbitration shall be borne equally by
both parties. The Tenant shall execute an extension agreement
incorporating the terms and conditions of such extension, which may
be in the form of the Landlord's then current Lease for the
Building. If the Tenant fails or neglects to submit the issue of the
Base Rent payable during such first extension Term to arbitration
within the aforesaid ninety (90) days, the Tenant shall be deemed
for all purposes of this Lease to have accepted the Base Rent
stipulated by the Landlord. The Tenant's option to extend the Term
for the Land Area beyond the initial Term is conditional on the
Landlord obtaining consent under the Planning Act, (Ontario) to
extend the term of the Lease for the Land Area beyond the initial
Term thereof. If the Landlord does not obtain such consent, the
Lease for the Land Area shall terminate on the last day of the
initial Term for the Land Area. All costs and expenses for related
to the obtaining such consent under the Planning Act (Ontario) shall
be borne by the Tenant, including , without limitation, all legal
fees and disbursements in connection therewith.
Page 3
(d) If the Tenant has exercised the right to the first extension of
the Term for the Land Area and the Landlord has obtained the consent
for such extension required under the Planning Act, Ontario as
aforesaid and the Tenant is not then in default under the Lease and
has not been in recurrent default under the Lease during the first
extension of the Term, the Tenant shall have the right on written
request delivered to the Landlord not less than six (6) months prior
to the expiry of the first extension Term to extend the Term for the
Land Area for one (1) further period of fifteen(15) years ( the
"SECOND EXTENSION TERM") on the same terms and conditions, save and
except for any further option to extend and Base Rent, which shall
be negotiated. The Base Rent payable during such second extension
Term shall be the then current market rent for comparable unfixtured
space in the vicinity of the Building and with similar exposure to
Highway 400. If the parties are unable to agree on the Base Rent for
the second extension Term within ninety (90) days prior to the
expiry date of the first extension Term, the Tenant shall have the
right to submit the issue of the amount of Base Rent payable during
such second extension Term to arbitration in accordance with the
Arbitrations Act, 1991 (Ontario). The Base Rent in any event shall
be not less than the Base Rent paid by the Tenant in the twelve (12)
months immediately preceding the expiry date of the first extension
Term. The costs of such arbitration shall be borne equally by both
parties. The Tenant shall execute an extension agreement
incorporating the terms and conditions of such extension, which may
be in the form of the Landlord's then current Lease for the
Building. If the Tenant fails or neglects to submit the issue of the
Base Rent payable during such second extension Term to arbitration
within the aforesaid ninety (90) days, the Tenant shall be deemed
for all purposes of this Lease to have accepted the Base Rent
stipulated by the Landlord.
The option provided in Section 1.6(c) hereof to extend the Term for
the Land Area is conditional on and can only be exercised by the
Tenant if the Tenant has exercised the option to extend the term for
Building Premises pursuant to Section 1.6(a). The option provided in
Section 1.6(d) hereof to extend the Term for the Land Area is
conditional on and can only be exercised by the Tenant if the Tenant
has exercised the option to extend the term for Building Premises
pursuant to Section 1.6(b).
1.7 - TENANT'S WORK
The Tenant shall supply and install at its own cost all required leasehold
improvements and any and all furnishings, equipment, machinery, piping and
other facilities and systems which the Tenant may require in connection
with the business being carried on by the Tenant in the Premises shall be
supplied and installed by the Tenant at its own cost and expense. The
Tenant accepts the Premises "as is". The Tenant shall have the option (the
"Option") to be exercised within ninety (90) days after the execution of
this Lease to purchase from the Landlord all or part of the FEM (as
hereinafter defined) on an "as is" basis at a price to be equivalent to
then current market value for such FEM. If the Tenant does not exercise
the Option within the time limited therefore the Landlord shall remove the
FEM from the Premises at the cost of the Landlord no later than one
hundred and twenty (120) days after the Option has expired. Payment for
the FEM shall be made by the Tenant to the Landlord forthwith upon
exercising the Option. If the landlord and Tenant are unable to agree upon
the current market value for the FEM within fourty-five(45) days prior to
the expiry date of the Option, then the Tenant shall have the right to
submit the issue of the current market value of the FEM to arbitration in
accordance with the Arbitrations Act, 1991 (Ontario). If the Tenant fails
or neglects to submit the issue of the current market value of the FEM to
arbitration within the aforesaid fourty-five 45) days, the Tenant shall be
deemed for all purposes of to have accepted the current market value
stipulated by the Landlord.
1.8 - FIXTURING PERIOD
The Tenant shall be entitled to occupy the Premises from the date of
execution hereof to November 1, 2006 (the "Fixturing Period") without the
payment of Base Rent, or Operating Costs
Page 4
2 - INTERPRETATION
2.1 - DEFINITIONS
In this Lease all words and phrases defined in this Section shall have the
meaning attributed to them by their definition:
(a) "ACCESSORY AREAS" means the area of corridors, washrooms, air cooling
rooms, fan rooms, janitors' closets, telephone and electrical closets and
other closets serving the Premises in common with other premises on the
same floor.
(b) "ADDITIONAL RENT" means all sums, however described, payable by the
Tenant under this Lease, other than Base Rent, whether payable to the
Landlord or others, and including, without limitation, Taxes and all other
amounts payable under this Lease;
(c) "ALL RISK" insurance means insurance against all risks of loss or
damage covered under standard commercial broad-form insurance or its
equivalent in effect from time to time, including without limitation,
coverage for earthquake and flood, sprinkler damage, off-site removal, law
and ordinance or by-law compliance, construction or reconstruction,
foundation and footings;
(d) "BASE RENT" means the Base Rent referred to in Section 1.2;
(e) "BUILDING" means the building of the Landlord located at the address
set out on the front page of this Lease and more particularly and includes
all improvements, extensions and additions from time to time made to the
Building;
(f) "BUILDING SERVICE AREAS" means the stairs, flues, stacks, pipe shafts,
vertical ducts and electrical or mechanical rooms with their enclosing
walls;
(g) "CAPITAL TAX" means an imputed amount now or in future imposed on the
Landlord (or any corporation acting on behalf of the Landlord) on account
of its ownership of or capital employed in the Building. Capital Tax shall
be computed as if the Building were the only real property of the Landlord
and includes the amount of any capital or place of business tax levied by
the provincial or federal government or any other applicable taxing
authority against the Landlord with respect to the Building, whether or
not known as "capital tax" or any other name, and includes the capital tax
now or in future imposed under the Corporations Tax Act (Ontario) and the
Large Corporations Tax under the Income Tax Act (Canada); provided that
the base on which the Capital Tax is imposed under this Lease shall not be
increased except as a result of capital additions to the Building;
(h) "COMMENCEMENT DATE" means the first day of November, 2006);
(i) "COMMON FACILITIES" means all common areas and utilities from time to
time furnished or designated (and which may at any time and from time to
time be added, reduced or otherwise changed) by the Landlord for the use
in common, in such manner as the Landlord may permit, with any other
tenant of the Building and all others entitled to access and their
respective officers, agents, employees, customers, invitees and licensees,
including, without limitation, parking areas, access roads, driveways,
entrances and exits, sidewalks, ramps, landscaped areas, building
entrances, foyer, lobbies, interior and exterior stairways, passageways
and washrooms;
(j) "CONSULTANT" means an independent architect, engineer or other
professional person duly licensed to practice in the Province of Ontario
and appointed by the Landlord in connection with any matter which, by the
terms of this Lease, is to be referred to a consultant, whose certificate
or determination shall be final and binding on the parties;
(k) "FEM" means the chattels, furnishings, equipment and machinery located
in, on or under the Building Premises on the date of this Lease;
(l) "GROSS LEASABLE AREA" means 350,000 Square Feet
Page 5
(m) "GST" means the Goods and Services Tax imposed under Parts VIII and IX
of the Excise Tax Act (Canada), and any other goods and service taxes,
business transfer taxes, sales taxes, value added or transaction taxes, or
any other taxes imposed on the Landlord with respect to the Rent and any
other amounts payable by the Tenant to the Landlord under the Lease which
may at any time be imposed by a governmental authority on or in respect of
rental or real property (other than Taxes, on Landlord's business income),
whether characterized as a goods and services tax, sales tax, value-added
tax or otherwise;
(n) "HVAC SYSTEM" means the heating, ventilating and air-conditioning
system serving the Premises in whole or in part, or the Building, as the
case may be;
(o) "INTEREST RATE" means that rate of interest per year, at the time
interest falls due under any provision of this Lease, which is five
percent (5%) in excess of the rate published by the Landlord's bank at
1:00 p.m. local time on the date in question as its prime or reference
interest rate then in effect for Canadian dollar demand loans to its most
favoured commercial customers (which, if used in this Lease, is referred
to as the "PRIME RATE");
(p) "LANDLORD" means the Landlord and his, her or its heirs, legal
personal representatives, successors and assigns;
(Q) "LAND AREA" means the thirteen (13) acres of land located at the
address set out on the front page of this Lease and more particularly
described in Schedule "B-1",
(r) "LEASE" means this Lease and all attached Schedules;
(s) "LEASE YEAR" means, in the year in which the Term commences, the
period of time from the commencement of the Term to December 31st of that
year and, in subsequent years, the twelve (12) month period commencing on
January 1 in that year and the balance, if any, of the Term after the last
full twelve (12) month Lease Year. The Landlord shall have the right at
any time during the Term to change the beginning and ending dates of the
Lease Year. If any Lease Year is less than twelve (12) months, the Rent
and other sums due, if applicable, shall be pro-rated by multiplying the
Rent (for a twelve (12) month period commencing on the first day of the
Lease Year) by the actual number of days in the Lease Year and dividing
the product by three hundred and sixty-five (365);
(t) "MORTGAGEE" means a mortgagee or hypothecary creditor (including a
trustee for bondholders) of the Property or part of it and a chargee or
other secured creditor that holds the Building or part of it as security,
and includes a prospective Mortgagee, but does not include a creditor,
chargee or security holder of a tenant of the Building; and "MORTGAGE"
means the security held by or to be granted to a Mortgagee relating to the
Property or any part thereof, including a mortgage, charge, assignment of
rents or leases, debenture and deed of trust or any other form of security
interest in real property granted or to be granted by the Landlord to a
Mortgagee;
(u) "MUNICIPALITY" means the city, metropolitan authority or regional
municipality in which the Building is situate and which has jurisdiction
over the zoning of the Lands on which the Building is situate;
(v) "OPERATING COSTS" means the total, without duplication, of all
expenses, fees, rentals, costs and disbursements of every nature and kind
paid or incurred by or on behalf of the Landlord determined for each Lease
Year on either a cash or an accrual basis in the complete maintenance,
repair, operation and management of the Property and, without limitation,
includes:
(i) the total annual net costs and expenses of insuring lands,
buildings, structures, erections, improvements and furnishings,
equipment, machinery and other property on the Property or any part
of it, from time to time, owned or operated by the Landlord or for
which the Landlord is legally liable, in such manner and form, with
such companies and such coverages and in such amounts as the
Landlord or a Mortgagee from time to time determines in accordance
with the Landlord's covenant to insure in the Lease; and if the
Landlord should elect to self-insure, in whole or in part, the
amount of any reasonable contingency reserves not exceeding the
amount of premiums which would otherwise have been incurred in
respect of the risks undertaken;
(ii) cleaning, snow removal, garbage and waste collection and
disposal (if supplied by Landlord);
Page 6
(iii) lighting, electricity, public utilities, public address, and
any telephone answering service facilities and systems used in or
serving the Property and the cost of electricity for any signs
designated by the Landlord as part of the Common Facilities;
(iv) policing, security, and supervision (if supplied by Landlord);
(v) salaries and benefits of personnel including supervisory
personnel, to the extent that the personnel are employed to carry
out the maintenance and operation of the Property, including
contributions and premiums towards fringe benefits, unemployment and
Worker's Compensation Insurance, workers' wage protection program
contributions, pension plan contributions and similar premiums and
contributions and the cost of all uniforms of employees and agents
or the cost of all independent contractors engaged in performing any
of the above activities;
(vi) the cost of the rental of any equipment and signs, and the cost
of supplies used by the Landlord in the operation, maintenance and
repair of the Property, including without limitation, the Building;
(vii) the reasonable rental value attributable to the management
office, mechanical and telephone rooms, if any, or other space used
by the Landlord in connection with the maintenance, repair,
operation or management of the Property, based on current rental
rates in the Building from time to time;
(viii) all repairs (including major repairs) and replacements to and
maintenance and operation, including servicing and inspection costs,
of the Property, including, without limitation, the Building and the
systems, facilities and equipment serving the Building (including
without limitation, transportation equipment and systems), other
than the portion of these costs properly chargeable to capital
account under proper accounting practice in the real estate
industry;
(ix) depreciation or amortization of the cost, including repair and
replacement, of all maintenance, cleaning and operating equipment,
the furnishings, equipment and machinery owned by the Landlord and
located in the Premises as at the date of this Lease, master utility
meters and all other building elements, fixtures, equipment and
facilities serving or comprising the Property, including without
limitation, the Building, unless they are charged fully in the Lease
Year in which they are incurred in accordance with proper accounting
practice in the real estate industry; together with interest
calculated at the Interest Rate on the undepreciated or unamortized
part of these costs;
(x) that portion of the Operating Costs of the HVAC system, if any,
allocated to the Common Facilities by the Landlord;
(xi) the cost of acquiring and installing energy conservation
equipment and systems for the Building or, if proper accounting
practice in the real estate industry requires the amortization of
these costs, then the portion properly chargeable during the Lease
Year;
(xii) the Taxes, if any, payable by the Landlord with respect to the
Common Facilities, any Taxes imposed against the Property (other
than vacant leasable space) or the Common Facilities, to the extent
not already charged to tenants as Additional Rent;
(xiii) all legal, audit and accounting fees and disbursements
incurred in connection with the operation and maintenance of the
Common Facilities and other parts of the Property, except such costs
as may be directly recoverable under individual leases with tenants
of the Building;
(xiv) Capital Tax; and
(xv) the cost of management fees paid to managing agents or, in lieu
thereof, if the Landlord manages the Property, an administration fee
equal to four percent (4%) of the Base Rent, Taxes and Operating
Costs (exclusive of this clause 2.1(t)(xv), depreciation and GST);
Operating Costs shall not include:
(xvi) ground rental;
(xvii) debt service costs;
Page 7
(xviii) leasing and rental advertising costs and commission charges
incurred by Landlord to lease the Building and any costs incurred in
making unrented premises fit for leasing;
(xix) costs recoverable by the Landlord under contractors'
warranties;
(xx) costs directly recoverable from individual tenants for services
rendered to them by the Landlord, including costs incurred in
preparing unoccupied premises for a tenant, installation of
leasehold improvements and supervision fees chargeable by the
Landlord;
(xxi) net recoveries that reduce the expenses incurred by the
Landlord in operating and maintaining the Building and the Common
Facilities which are received by the Landlord from Tenants as a
result of any act, omission, default or negligence of Tenants or as
the result of breaches by Tenants of the provisions in their leases;
(xxii) the costs and expenses incurred in the maintenance and
operation of the Building and the Common Facilities to the extent
that the Landlord receives proceeds in respect of such costs and
expenses from insurance policies taken out by the Landlord; and
(xxiii) net recoveries from charges, if any, made for the use of the
parking facilities of the Property, but only to the extent of the
total costs of maintaining and operating the parking facilities.
(w) "PARTY" means any party to this Lease and "PARTIES" means two or more
parties;
(x) "PERSON" means an individual, partnership, corporation, trust or
unincorporated organization, and includes a government or agency or one of
its political subdivisions;
(y) "PREMISES" means the part of the Land Area and the Building leased to
the Tenant, which are illustrated in Schedules " B" and "B-1" attached
hereto and which consists of:
(i) "Building Premises" means 350,000 square feet of office and
commercial/industrial space, including the floor and ceiling slabs,
interior walls separating such premises from adjacent premises, the
inside surface of the walls, ceilings and floors of such premises,
exterior and interior doors and the interior surfaces of windows,
all mechanical and electrical and water, gas, sewage, telephone and
other communications facilities and electric power services and
utilities for the exclusive use of the Tenant and found within the
Premises and all heating, ventilating and air-conditioning equipment
for the exclusive use of the Premises; and
(ii) the Land Area comprising thirteen (13) acres ,
but reserving to the Landlord the right to make reasonable variations,
expansions and additons in the area, form or siting of the Premises from
time to time in accordance with the terms of the Lease;
(z) "PROPERTY" means the lands legally described in Schedule "A" attached
hereto and includes, without limitation, the Land, the Building, the
Common Facilities, all structures, erections, buildings, facilities and
improvements located, from time to time, on, in or under the lands;
(aa) "RENT" includes Base Rent and Additional Rent;
(bb) "STRUCTURAL REPAIRS" means repairs to the foundation, wall and roof
support columns, roof joists and the wood or metal roof deck, roof and
roof moisture protection and no other components of the Building and
"STRUCTURAL DEFECTS" or "STRUCTURAL WEAKNESS" means defects or weakness in
the same components;
(cc) "TAXES" means all present and future real estate taxes, general
taxes, public and local improvement rates, school taxes, imposts, charges,
levies, rates, duties, assessments (including special assessments) and
charges imposed against the Property or any part thereof or imposed by
virtue of the use or occupancy of the Premises or the Building by the
Tenant or the Property by the Landlord, by municipal or other governmental
authorities, boards or commissions of any nature whatsoever having
jurisdiction, or other taxes based on the area or uses of the Property or
the Premises, including any tax on Rent imposed in lieu of any of the
above taxes. It is the intention of the parties that all new assessments,
taxes, fees, levies and charges will be Taxes for the purposes of this
Lease. Taxes do not include GST or inheritance, income, payroll, excise,
privilege, rent, estate or profit tax, Landlord's franchise, estate or
income taxes, that is or may be imposed on Landlord, unless such taxes are
levied on the Rent in lieu of Taxes. Taxes shall also include the costs
and expenses, including consultants fees and disbursements, incurred by
the Landlord in attempting to obtain a reduction or prevent an increase in
Taxes;
Page 8
(dd) "TENANT" means the Tenant and his, her or its heirs, legal personal
representatives, successors and permitted assigns;
(ee) "TENANT'S PROPORTIONATE SHARE"
(i) in the case of Taxes the Tenant's proportionate share shall be
determined as follows:
(A) if there shall be any information made available to the Landlord
by authorities having jurisdiction from which a separate assessment
may, in the Landlord's opinion, be readily determined for Taxes for
the Premises, and if such separate assessment, together with all
other separate assessments of leasable premises in the Property,
aggregates to the total assessment of the Property; or
(B) if such separate assessment, together with all other separate
assessments of leasable premises in the Property, does not aggregate
to the total assessment of the Property, the Landlord shall
determine such assessment utilizing 100% of the assessment for the
Property and deducting therefrom the the amount determined by the
Landlord as the amount of the assessment applicable to 70,000 square
feet of the Building leased as industrial space. At the Landlord's
sole option, a consultant retained by the Landlord may determine
such assessment using principles known to be applied in Ontario or
on such other reasonable and equitable basis as the Landlord
determines;
the Tenant's proportionate share shall be equal to the assessment
determined in accordance with clause (A) or (B), as the case may be, and
the applicable mill or taxation rate; and
(ii) in the case of any other amount provided for in this Lease, means the
proportion of the amount which the total Gross Leasable Area of the
Building Premises is of the total Gross Leasable Area of all leasable
premises in the Building (including the Building Premises), as set out in
a Consultant's Certificate; provided that if the other tenant of the
Building utilizes the services or goods included in the calculation of
Operating Costs in greater or lesser proportion than the Tenant, then for
the purpose of calculating the Tenant's proportionate share of Operating
Costs the Landlord, acting reasonably, may apportion such charges incurred
during that Lease Year among the different portions of the Building in
such manner as the Landlord deems most appropriate;
(ff) "TERM" means the Term demised to the Tenant in Section 5 and, unless
otherwise required by the context, any renewal or extension of the
original Term, or any shorter period provided in this Lease.
2.2 - SEVERABILITY
If one or more clauses or paragraphs in this Lease are illegal or
unenforceable in whole or in part, it or they shall be considered separate and
severable from the Lease and the remaining provisions of the Lease shall remain
in full force and effect and shall be binding on the parties as though the
clauses or paragraphs or parts in question had never been included.
2.3 - NUMBER
Whenever a word importing the singular number only is used in this Lease,
such word shall include the plural. Words importing either gender or firms or
corporations shall include the other gender and individuals, firms or
corporations, if applicable.
2.4 - HEADINGS
The headings appearing in this Lease have been inserted as a matter of
convenience and for reference only and in no way define, limit or enlarge the
scope or meaning of this Lease or any of its provisions.
2.5 - ENTIRE AGREEMENT
The Tenant acknowledges that there are no covenants, representations,
warranties, agreements or conditions, express or implied, collateral or
otherwise, forming part of or in any way affecting or relating to this Lease
save as expressly set out or imported by reference in this Lease and that this
Lease, including all attached Schedules and riders, if any, constitutes the
entire agreement between the Landlord and the Tenant with respect to the
Premises. No amendment, alteration or addition to this Lease will be binding on
Landlord or Tenant, unless it is in writing and signed by both parties.
Page 9
2.6 - SUCCESSORS
This Lease shall extend to, be binding on and enure to the benefit of the
parties and their respective heirs, legal personal representatives, successors
and permitted assigns (as limited by the provisions of this Lease) and shall be
interpreted in accordance with the laws of the Province of Ontario and the
parties attorn to the jurisdiction of the courts of Ontario.
2.7 - NET-NET AND CAREFREE LEASE
This is a "care free" Lease and it is the mutual intention of the parties
that the Rent shall be net to Landlord and clear of all taxes (except Landlord's
income taxes and except as otherwise specifically provided in this Lease), costs
and charges arising from or relating to the Premises and that Tenant shall bear
all costs of and be responsible for all matters in relation to the operation,
maintenance and repair of the Premises on the basis of the Tenant's
proportionate share of all costs, charges and the like, referred to as Operating
Costs herein and shall pay all charges, impositions and expenses of every nature
and kind relating to the Premises and Tenant covenants with Landlord
accordingly.
2.8 - METRIC CONVERSION
If any measurement in this Lease is required to be converted between
metric and imperial measure, the following conversion factors will apply: 1
metre = 3.2808 feet; 1 square metre = 10.7693 square feet; 1 foot = .3048
metres; and 1 square foot = .0929 square metres.
2.9 - LANDLORD'S CONSENT
Whenever this Lease requires the Landlord to give its prior written
consent or authorization or to exercise its discretion with respect to any
action proposed by the Tenant, unless the specific wording of the Lease or the
context in which the requirement is found requires otherwise. The Landlord will
not be required to give any consent or authorization or to exercise its
discretion until the Tenant has first complied with all requirements of this
Lease or reasonably imposed by the Landlord, including the provisions of Section
17.2, as a condition to the giving of the consent or authorization or the
exercise of its discretion.
2.10- BUILDING STANDARD
The Landlord and the Tenant shall perform their respective obligations
under this Lease having regard to the general standard prevailing for first
class industrial/commercial buildings in the Municipality and subject to the
limitations occasioned by the design of the Building and its basic systems.
3 - PREMISES
3.1 - DEMISE OF PREMISES
In consideration of the Rents, covenants and agreements contained in this
Lease to be paid, observed and performed by the Tenant, the Landlord has demised
and leased and by this indenture demises and leases to the Tenant the Premises.
4 - COMMON FACILITIES
4.1 - USE OF COMMON FACILITIES
The Tenant, together and in common with all others entitled thereto and
their respective officers, agents, servants, employees, contractors, customers,
invitees and licensees, shall be entitled to the use and benefit of the Common
Facilities. The Tenant shall not unreasonably block or in any manner hinder the
Landlord or other persons who may be authorized by the Landlord to utilize the
Common Facilities from so doing. The Landlord may, in its discretion from time
to time, permit certain persons to have the exclusive use of portions of the
Common Facilities to the exclusion of the Tenant and other persons.
5 - TERM
5.1 - TERM OF LEASE
TO HAVE AND TO HOLD the Premises for and during the Term set out in
Section 1.1.
Page 10
5.2 - PLANNING ACT
This Lease is entered into subject to the express condition that the
provisions of the Planning Act (Ontario) as amended and in force from time to
time, with respect to subdivision control, shall be complied with. If the Term
(including renewals provided in this Lease) extends for a period of twenty-one
(21) years or more and a consent is required under the Planning Act (Ontario) to
comply with the subdivision control provisions and if this consent has not been
obtained within ninety (90) days from the date of commencement of the Term of
this Lease or any extension of the Term provided for in this Lease, the parties
agree to treat this demise as a Lease for not more than twenty-one (21) years
less one day on the same terms and conditions, save and except as to the Term
(including renewals) of the demise. The Tenant shall have the right at any time
during the twenty-one (21) year period to apply at its own expense for a consent
to extend the Term (including renewals) to the original length provided for in
this Lease.
6 - RENT
6.1 - BASE RENT
The Tenant will pay to the Landlord, without deduction or set-off, yearly
and every year during the Term, as Base Rent, the sums set out in Section 1.2
(a) and ( b). All Rent is payable in Canadian dollars in advance, on the FIRST
(1ST) day of each and every month during the Term (commencing November 1, 2006).
Payments shall be made by cheque or money order, payable to the Landlord at the
address set out on the front page of this Lease, or as it may direct from time
to time.
6.2 - MONTHLY INSTALMENTS - ADDITIONAL RENT
All Additional Rent payable under this Lease shall be charged to the
Tenant as Rent and, unless otherwise provided in this Lease, shall be payable on
demand, without deduction or set-off, as soon after the end of the Lease Year in
which the charge is made as the amount can be determined. The Landlord, acting
reasonably, may in each Lease Year estimate the amount of Additional Rent
payable for that Lease Year. At the Landlord's option the Additional Rent shall
be payable in equal monthly instalments, on the same dates as the payment of
Base Rent is due, during the Lease Year or the balance of the Term, whichever is
shorter. If monthly instalments are made, the amount of the Additional Rent
actually due shall be calculated within one hundred and twenty (120) days of the
end of the Lease Year, or the Term, and the Tenant shall pay the deficiency, if
any, on demand, or the Landlord shall credit the Tenant with any overpayment,
such overpayment to be applied in payment of the instalments of Rent next
falling due, or if the Term has expired, the overpayment shall be repaid to
Tenant.
6.3 - DEPOSIT
The Landlord acknowledges receipt of the deposit (if any) set out in
Section 1.4(a), to be applied against the instalments of Base Rent, CAM, Taxes
and GST for the months of the Term set out in Section 1.4(a) and for the due
payment of Rent and the due performance of the Tenant's covenants and
obligations.
6.4 - PAYMENT ARRANGEMENTS
The Tenant agrees either (i) to arrange for a bank pre-authorized payment
plan or automatic deposit system for payment of the Rent, or (ii) to deliver to
the Landlord at the commencement of the Term, and one (1) month before the first
day of each Lease Year after the first, a series of post-dated cheques for each
instalment of Base Rent falling due during that Lease Year. In addition, if the
Landlord estimates the Additional Rent payable by the Tenant for any Lease Year,
the Tenant will deliver to the Landlord a series of post-dated cheques for the
Additional Rent, on receipt of the estimate.
6.5 - GST
In addition to the Rent payable hereunder, the tenant shall pay to the
Landlord concurrently with the payment of Base Rent and Additional Rent the full
amount of all GST imposed on the Tenant in respect of the Rent payable by the
Tenant under this Lease. Such GST payable by the Tenant, notwithstanding
anything in this Lease to the contrary, shall not be considered to be Rent, but
the Landlord shall have all of the same remedies for and rights of recovery with
respect to unpaid GST as it has for non-payment of Rent under this Lease or at
law.
6.6 - REMEDIES
(a) If any cheque given by the Tenant to the Landlord in payment of Rent
is refused payment by Tenant's bank for any reason, the Tenant shall immediately
replace that cheque with cash, or a certified cheque or bank draft and shall
pay, in addition, as Additional Rent, the sum of one hundred dollars ($100) as a
service charge to the Landlord.
Page 11
(b) In addition to any other remedy available to the Landlord
at law or under this Lease, if the Tenant fails to make any payment of Rent on
its due date, the Tenant shall pay immediately on demand, as Additional Rent, to
compensate the Landlord for any loss incurred as a result of such late payment,
the greater of fifty dollars ($50) or five percent (5%) of the amount of Rent
overdue.
7 - COVENANTS OF THE TENANT
THE TENANT COVENANTS WITH THE LANDLORD AS FOLLOWS:
7.1 - PAY RENT
The Tenant will pay all Rent in the manner set out in this Lease without
any deduction, abatement or set-off whatsoever. The Tenant waives any right to
set off provided by Section 35 of the Commercial Tenancies Act, or its amending
or successor legislation.
7.2 - UTILITIES
The Tenant shall at its cost and expense install separate meters or check
meters for the Premises on or before November 1, 2006. The Tenant shall pay as
and when due, to the Landlord or the public authority, as the case may be, all
charges for public utilities (the "UTILITIES") which, without limitation,
includes water, gas, heat, electrical power or energy, steam or hot water used
on or in respect of the Premises and for fittings, machines, apparatuses, meters
or other things leased in respect of utilities and for all work or services
performed by any corporation or commission in connection with utilities. In no
event shall Landlord be liable for any loss of business by the Tenant or for any
injury to Tenant, its servants, agents, employees, customers and invitees or for
any injury or damage to the Premises or to any property of Tenant or to any
property of any other person, firm or corporation on or about the Premises
caused by an interruption or failure in the supply of utilities to the Premises.
If required by the Landlord or by the utility company, separate meters or check
meters will be installed in the Premises at the Tenant's expense. In the absence
of meters, the Landlord, acting reasonably, has the right from time to time to
apportion the cost of utilities among the Premises and other premises and
portions of the Building. Any dispute as to the Landlord's apportionment shall
be conclusively resolved by a certificate of the Landlord's Consultant. The
Tenant shall pay one-half of the cost of obtaining such certificate, on demand,
as Additional Rent.
7.3 - MAINTENANCE
The Tenant will pay to the Landlord by monthly instalments to be fixed
from time to time by Landlord in its sole discretion, as Additional Rent, the
estimated Tenant's proportionate share of Operating Costs. The Landlord shall
submit to the Tenant a reasonably detailed statement of Operating Costs for each
Lease Year, including Tenant's proportionate share. To the extent that the
Tenant's proportionate share of Operating Costs is greater or less than the
amount actually paid by it for that Lease Year, the difference shall be adjusted
and paid in accordance with Section 6.2.
7.4 - REPAIRS AND MAINTENANCE
(a) The Tenant shall maintain and repair the Premises at its own
expense and keep them in a clean and sanitary condition and in accordance with
all laws, directions, rules and regulations of the governmental agencies having
jurisdiction. The Tenant's obligation under this Section includes keeping the
Premises and the machinery, equipment (including, to the extent that they are
part of the Premises, the interior and exterior walls, doors, roof and any
paved, sodded and planted areas and all permitted signs) in good order and
repair and painted or otherwise presentable and maintaining in good operating
condition and replacing, whenever reasonably required, the heating, ventilating,
air conditioning, mechanical, electrical and plumbing systems, services and
equipment installed in and for the exclusive use of the Premises and replacing
all broken glass with glass of equal quality. This obligation includes, but is
not limited to, repainting and redecorating at reasonable intervals, making
repairs and replacements to plate glass, signs, mouldings, doors, hardware,
partitions, walls, fixtures, lighting and plumbing fixtures, wiring, piping,
ceilings, floors and thresholds in the Premises and maintaining, repairing and
replacing the machinery and all operating equipment in the Premises unless it
forms part of the Common Facilities.
(b) The Landlord may enter the Premises to view the state of repair.
If the Tenant or its representatives are not present to open the Premises at any
time when, due to emergency, entry is necessary, the Landlord or its agent may
forcibly enter the Premises, without rendering the Landlord or its agent liable,
and without affecting the Tenant's obligations under this Lease.
(c) Where an inspection reveals repairs are necessary and required
by the Lease to be done by the Tenant, the Landlord shall give notice to the
Tenant. The Tenant will, within fifteen (15) days from delivery of the notice,
make, or commence making and diligently proceed to complete, the repairs in a
good and workmanlike manner. In addition to any other provision of this Lease,
the Landlord may enter the Premises and perform any repairs which the Tenant has
failed to make under this Section.
(d) The Tenant shall leave the Premises in good repair.
Page 12
(e) The obligations of the Tenant to repair in accordance with
Sections 7.4(a), 7.4(c) and 7.4(d) shall be subject to the following exceptions:
(i) Structural Repairs to the Premises or injury to the Premises
caused by or resulting from structural defects or structural
weakness, but this exception does not excuse the Tenant from
liability for repair of structural defects or structural weakness
caused by or resulting from the act or omission, whether negligent
or otherwise, of the Tenant, its officers, agents, servants,
employees, contractors, licensees or invitees;
(ii) damage or injury caused by or resulting from any act, default
or negligence of the Landlord, its officers, agents, servants,
employees or contractors;
(iii) repairs and maintenance to be performed by the Landlord under
Article 9; and
(iv) repairs to be performed by the Landlord under Section 13.1, to
the extent of the insurance proceeds available and except as
provided in Sections 13.2 and 13.3.
(f) If the Tenant observes any apparent structural defect or
material damage to the Premises by any cause, it shall immediately notify the
Landlord. If any structural defect or damage becomes known to the Tenant or
reasonably should have been observed by the Tenant and the Tenant fails to
notify the Landlord, the Tenant shall be liable for any costs incurred by the
Landlord in repairing the defect or damage which can be shown to be directly
attributable to the actions of the Tenant and those for whom in law the Tenant
is responsible (including failure to give the required notice) after such defect
or damage became known to the Tenant or reasonably should have been observed by
the Tenant.
(g) If the Building, including any part of the Common Facilities or
the Premises, or any of the plumbing, electrical mechanical, or other services
serving the Building, get out of repair or become damaged or destroyed through
the negligence, carelessness or misuse of the Tenant, the Tenant's servants,
agents or employees or anyone permitted by the Tenant to be in the Building, the
expense of the necessary repairs, replacements or alterations, including the
Landlord's management fee of fifteen percent (15%) of the expense, shall be paid
by the Tenant to the Landlord on demand, as Additional Rent.
7.5 - COMPLY WITH ALL LAWS
(a) The Tenant shall comply promptly with and conform to the
requirements of all applicable statutes, laws, by-laws, regulations, ordinances
and orders in force at any time during the Term and affecting the condition,
equipment, maintenance, use or occupation of the Premises and the FEM and with
every applicable regulation, order and requirement of the Canadian Fire
Underwriters' Association, Insurance Advisory Organization, or any body having
similar functions, or of any liability or fire insurance company by which the
Landlord and the Tenant, or either of them, may be insured at any time during
the Term. If the Tenant defaults under any provision of this Section, the
Landlord may perform the Tenant's obligation and the Tenant will pay all costs
and expenses incurred, on demand, as Additional Rent. Notwithstanding the
foregoing, it shall be the Landlord's responsibility to comply with federal and
provincial legislative enactments, building by-laws and other governmental or
municipal regulations which relate to the Building insofar as they may require
changes of a structural nature in the Building; provided nevertheless that such
changes shall be the responsibility of the Tenant, to be paid for by the Tenant
as Additional Rent on demand, if they are changes required to be made in the
Tenant's improvements or partitioning, whether or not such changes are
structural, or if such changes are required by reason of the nature of the use
or improvements contemplated or made by the Tenant.
(b) The Tenant acknowledges that any sprinkler system which may be
in the Premises is for ordinary hazard use only, in accordance with the
requirements of the Insurance Advisory Organization standard, or any applicable
successor. If the Landlord, acting reasonably, determines at any time during the
Lease that the sprinkler system is not satisfactory for the use of the Premises
by the Tenant, or the use contemplated by this Lease, the Tenant shall pay to
the Landlord on demand in advance, as Additional Rent, the entire cost of
upgrading the sprinkler system to the standards required for the Tenant's use.
The Tenant will allow the Landlord's employees and contractors to enter the
Premises to effect the required alterations to the sprinkler system and the
Landlord shall not be responsible to the Tenant for any disturbance or business
interruption which may be caused, provided that the Landlord shall use its
reasonable best efforts to minimize such disturbance or interruption. The Tenant
shall be solely responsible for any increase in insurance premiums caused in and
about the Building and the Common Facilities until the alterations have been
completed. In the alternative, the Landlord may, in its sole discretion, require
the upgrading of the sprinkler system to be performed by the Tenant and Tenant
agrees to undertake and complete its work within two (2) months of written
notice from the Landlord. The Tenant will take instructions from the Landlord as
to the nature of the upgrading and will employ only such contractors as the
Landlord directs or consents to in writing. The Tenant agrees that the sprinkler
system will be upgraded to the standard required by the Insurance Advisory
Organization, or its successor.
Page 13
7.6 - USE AND OPERATION
(a) The Tenant will use the Premises only for purposes permitted
under this Lease. The Tenant shall satisfy itself that its use of the Premises
is in compliance with all applicable zoning and use by-laws and restrictions
affecting the Premises. The Tenant will not use or permit the use of all or part
of the Premises for any other purpose or business and, more particularly, but
without limitation, will not use or permit the use of all or part of the
Premises for the business of a bank, treasury branch, credit union, trust
acceptance or loan company or any other organization engaged in the business of
accepting money on deposit, or any similar banking business (excluding
insurance, stock brokers or investment dealers), nor use nor permit the use of
any part of the Premises for the purpose of installation or operation of any
electronic or mechanical equipment, devices or machines by which any banking
transaction, operation or function may be available to the public, nor use or
permit the use of any part of the Premises for the manufacture or sale of
alcohol or any beverage containing alcohol, for human consumption or as a
restaurant, cafeteria, lunch counter, food dispensary, snack bar or other food
services operation, except as a kitchen or lunchroom for the use of the Tenant's
employees, and which operates without charge to its users.
(b) The Tenant shall occupy the Premises and commence its business
operations in the Premises from and after the Commencement Date and conduct its
business in the whole of the Premises in a reputable and first-class manner. In
the conduct of the Tenant's business, the Tenant shall:
(i) install and keep in good order and condition, free from liens
and encumbrances of third parties, fixtures and equipment of
first-class quality;
(ii) abide by all rules and regulations and general policies
formulated by the Landlord from time to time relating to the
delivery of goods and merchandise between the general shipping and
receiving areas and the Premises, including rules and regulations
regulating the times when, the manner in which, and the use of the
entrances and exits, the delivery of goods or merchandise in or to
the Building;
(iii) not obstruct the Common Facilities, including the sidewalks,
entrances, stairway or corridors of the Building, or use any of them
for any purpose other than ingress and egress from the Premises and
not do, nor suffer or permit anything to be done which, in the
Landlord's opinion, in any way obstructs the free movement of
persons doing business in the Building, and not place or allow to be
placed in the hallways, corridors or stairways of the Building any
waste paper, dust, garbage, refuse or anything whatsoever that would
tend to make them appear unclean or untidy; and
(iv) not refer to the Building by any name other than that
designated from time to time by the Landlord, nor use such name for
any purpose other than that of the business address of the Tenant,
provided that the Tenant may use the municipal number of the
Building assigned to it by the Landlord instead of the name of the
Building. The Tenant does not have nor will it acquire any rights in
the name of the Building and, at the option of the Landlord, the
Tenant will abandon or assign to the Landlord any such rights which
the Tenant may acquire by operation of law, and will promptly
execute such documents as in opinion of the Landlord are or may be
necessary to give effect to this subparagraph.
Any business, conduct or practice promulgated, carried on or
maintained by the Tenant, whether through advertising or selling procedures or
otherwise, which in the opinion of the Landlord, acting reasonably, may harm or
tend to harm the business or reputation of the Landlord or reflect unfavourably
on the Building, the Landlord or the other tenant in the Building, or which may
tend to confuse, mislead, deceive or be fraudulent to the public, shall be
immediately discontinued by the Tenant at the written request of the Landlord.
7.7 - LANDLORD'S RECOVERY
If the Landlord performs any repairs or maintenance, or does any other
work, or pays any sum of money due or payable by the Tenant, either at the
request of the Tenant, or by reason of any default by the Tenant in performance
of its covenants, the Tenant shall repay to the Landlord on demand, as
Additional Rent, the cost of performing such repairs, maintenance and work or
the amount paid by the Landlord on Tenant's behalf, together with the Landlord's
management fee of fifteen percent (15%) of such amount.
Page 14
7.8 - WASTE
The Tenant shall not do or suffer any waste or damage, disfiguration or
injury to the Premises or the fixtures and equipment in or serving the Premises.
Subject to Section 7.11 of this Lease, the Tenant may at its sole option and
cost and expense, demolish and replace the part of the Building illustrated on
Schedule "D-1" annexed hereto. The Tenant will not bring on the Premises
anything that might damage them or overload the floors, except with the express
written consent of the Landlord and at its own expense make whatever changes are
necessary to comply with the reasonable and lawful requirements of the
Landlord's insurance underwriters and governmental authorities having
jurisdiction. No part of the Premises shall be used for any dangerous, noxious
or offensive trade or business. The Tenant shall not do anything or permit
anything to be brought on the Premises which the Landlord may reasonably deem to
be a nuisance. The Tenant shall take every reasonable precaution to protect the
Premises and the Building from danger of fire, water damage or the elements. The
Tenant shall not allow any ashes, refuse, garbage or other loose, objectionable
material to accumulate in, on or about the Premises or the Building and will at
all times keep them in a clean and wholesome condition.
7.9 - COMPLIANCE WITH ENVIRONMENTAL LEGISLATION
The Tenant covenants with the Landlord that, from and after the occupation
of the Premises by the Tenant, the Tenant, and anyone for whom it is responsible
in law, shall not use or permit or suffer the use of the Premises to generate,
manufacture, refine, treat, transport, store, handle, dispose of, transfer,
produce or process any substance deemed or defined as contaminants or hazardous
materials (the "HAZARDOUS SUBSTANCES") under the Environmental Protection Act
(Ontario) and its regulations, or under any other applicable federal or
provincial statute, regulation or municipal by-law dealing with environmental,
land use, occupational, health or safety matters, or guidelines published under
any of them (the "ENVIRONMENTAL LEGISLATION"), except in strict compliance with
all Environmental Legislation, and only if the use of such Hazardous Substances
is necessary for the conduct of the Tenant's business for the use permitted in
Section 1.5. If the nature of the Tenant's business requires the use of
Hazardous Substances during the Term, the Tenant and its principals shall be
liable for and shall carry out all clean-up work, remedial actions,
decommissioning work or capital expenditures required by the Environmental
Legislation to properly remove or dispose of Hazardous Substances which are in
excess of the levels permitted in the circumstances to be on or in the Premises
and the Building. The Tenant agrees to indemnify the Landlord of and from all
claims, orders or directions arising under the Environmental Legislation that
result from any matter or occurrence caused or contributed to by the Tenant or
anyone for whom it is responsible in law. Upon the expiry of the Term, the
Tenant and its principals shall be liable for and shall carry out all clean-up
work, remedial actions, decommissioning work or capital expenditures required by
the Landlord to properly remove or dispose of Hazardous Substances on, in or
under the Premises or flowing or leeching from the Premises.
7.10 - ELECTRICAL AND OTHER SERVICE FACILITIES
(a) The Tenant shall not install or use any electrical or other
equipment or electrical arrangement which may overload the electrical,
mechanical, plumbing or other service facilities without the prior written
consent of the Landlord. The Tenant will pay for any costs or expenses in
respect of the Premises resulting from use of equipment necessitating dedicated
circuitry or specialized power requirement. The Tenant at its own expense will
make any changes to the electrical and other service facilities necessary to
comply with the reasonable and lawful requirements of the Landlord's insurance
underwriters and governmental authorities having jurisdiction. The Tenant shall
make no changes to the electrical, mechanical, plumbing and other service
facilities without the Landlord's prior written approval of the plans and
specifications for the changes, which will not be unreasonably withheld.
(b) The Landlord has the right to determine which utility company
will provide electricity service to the Building (the "PROVIDER"). In addition,
if permitted by law, the Landlord will have the right at any time and from time
to time during the Term to retain or change the Provider. For the purpose of any
change of Provider, the Tenant shall allow the Landlord or a new Provider to
have access to the Building's electric lines, feeders, risers, wiring and any
other machinery within the Premises.
7.11 - ALTERATIONS
(a) The Tenant will not make, install or erect in or to the Premises
any installations, erections, structures, alterations, additions or partitions
without first submitting the drawings and specifications to the Landlord and
obtaining the Landlord's prior written consent in each instance, which consent
shall not be unreasonably withheld. Furthermore, the Tenant must obtain the
Landlord's prior written consent to any change or changes in such drawings or
specifications, and shall pay, as Additional Rent, on demand, the cost to the
Landlord of having its Consultants approve such changes prior to proceeding with
any work based on such drawings or specifications The Tenant shall not demolish
all or any part of the Building without first submitting the drawings and
specifications to the Landlord and obtaining the Landlord's prior written
consent in each instance, which consent shall not be unreasonably withheld.
Furthermore, the Tenant must obtain the Landlord's prior written consent to any
change or changes in such drawings or specifications, and shall pay, as
Additional Rent, on demand, the cost to the Landlord of having its Consultants
approve such changes prior to proceeding with any work based on such drawings or
specifications. Such work may be performed by contractors engaged by the Tenant
but in each case under written contract, approved in writing by the Landlord and
subject to all reasonable conditions which the Landlord may impose. Any work
performed by or for the Tenant shall be performed by competent workmen whose
labour union affiliations are not incompatible with those of any workmen who may
be employed by the Landlord, its contractors or sub-contractors and the Tenant
provides the Landlord with satisfactory evidence that all contractors or
sub-contractors providing services with respect to the demolition or
construction have appropriate labour and material bonding. All such
installations, alterations, additions, changes and work performed by or for the
Tenant shall conform to all building by-laws and shall conform to all federal,
provincial and municipal rules and regulations, if any, then in force affecting
the Premises and the Building. Such installations, alterations, additions,
changes and work performed by or for the Tenant shall be completed in a good and
workmanlike manner.
(b) Unless otherwise agreed to by the Landlord, If any of the
following work is required by the Tenant, it shall be carried out by the
Landlord under written contract with the Tenant and at the Tenant's sole
expense:
Page 15
(i) all approved work relating to heating, cooling, ventilation,
exhaust, control, electrical distribution and life safety systems,
(ii) patching of building standard fireproofing,
(iii) any drilling, cutting, coring and patching for conduit, pipe
sleeves, chases, duct equipment, or openings in the floors, walls,
columns or roofs of the Building which are approved by the Landlord;
and
(iv) installation of approved modifications to the sprinkler system.
On completion of such work, by the Landlord or its contractors, the
Tenant shall pay to the Landlord as Additional Rent, on demand, the costs of the
Landlord relating to such work (including the fees of any Consultant) plus the
Landlord's management fee of fifteen (15%) of the cost of the portion of the
work performed by the Landlord or its contractors.
(c) The Tenant shall submit to the Landlord's supervision over
construction and promptly pay to the Landlord's or to the Tenant's contractors
as the case may be, when due, the cost of all such work and of all materials,
labour and services involved in the work and of all decoration and all changes
in the Building, its equipment or services, necessitated by the Tenant's work.
If the Tenant performs any work without the consent of the Landlord or without
complying with the provisions of this Section, such work shall be promptly
removed by the Tenant and the Premises restored to their previous condition, all
at the expense of the Tenant. Any erection, addition or improvement placed on
the Premises shall be subject to all the provisions of this Lease and, if
removed as provided in this Lease, the Tenant shall repair all damage caused by
the installation and removal.
(d) The Landlord shall have the right to charge and be paid as
Additional Rent a reasonable management fee for and in connection with the
supervision by the Landlord of the making of any repairs, alterations,
installations and construction relating to the Premises by the Tenant.
7.12 - RIGHT TO SHOW PREMISES
The Landlord or its agents and employees shall have the right at any
time during business hours of the Tenant to enter the Premises to show them to
prospective purchasers, Mortgagees or tenants, provided that the exercise of
such rights shall not unreasonably interfere with the Tenant's business.
The Landlord shall have the right within three (3) months prior to
the end of the Term or any renewal to place on the Premises a notice, of
reasonable dimensions and reasonably placed so as not to interfere with the
Tenant's business, stating that the Premises are available for rent. The Tenant
will not remove or permit this notice to be removed. The Landlord and its agents
and employees shall also be permitted to enter the Premises within this period
to show the Premises to prospective Tenants.
7.13 - LIABILITY TO INVITEES, LICENSEES
Except as expressly provided in this Section, the Landlord shall not
in any event whatsoever be liable or responsible in any way for any personal
injury or death that may be suffered or sustained by the Tenant or any employee
of the Tenant or any other person who may be on the Premises or any Common
Facilities or for any loss or damage or injury to any property belonging to the
Tenant or to its employees or to any other person while such property is on the
Premises. In particular (but without limiting the generality of the foregoing)
the Landlord shall not be liable for any damage to any such property caused by
steam, water, rain or snow which may leak into, issue or flow from any part of
the Building or any adjoining premises or areas or from any water, steam,
sprinkler or drainage pipes or plumbing works or from any other place or quarter
or for any damage caused by or attributable to the condition or arrangement of
any electrical or other wiring or for any damage caused by anything done or
omitted to be done by any other tenant. Notwithstanding the foregoing, the
Landlord shall not be released from liability or responsibility for loss, damage
or injury resulting from the negligent act or omission or tortious conduct of
the Landlord or any person for whom the Landlord is responsible in law, but such
liability or responsibility for any negligent act, omission or tortious conduct
shall only apply to the extent that the loss, damage or injury is covered by the
proceeds of a policy of insurance in favour of the Landlord and, as a condition
to receipt of such proceeds, the Tenant and anyone claiming by or through the
Tenant shall release the Landlord from any claim for any amount in excess of the
amount recoverable under such policy; and provided further that the Landlord
shall not be liable in any event for any damage or injury covered by any
insurance policy taken out by the Tenant, or which the Tenant is required to
have taken out by any provision of this Lease.
Page 16
7.14 - TENANT'S INDEMNITY OF LANDLORD
Except as expressly provided in this Section, the Tenant shall indemnify
the Landlord and save it harmless from and against any and all loss (including
loss of all Rent payable by the Tenant under this Lease), claims, actions,
damages, liability and expense 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, on or at the Premises, or the occupancy or use
by the Tenant of all or any part of the Premises, or occasioned wholly or in
part by any act or omission of the Tenant or by anyone permitted to be on the
Premises by the Tenant. Notwithstanding the foregoing, the Tenant shall not be
liable to indemnify the Landlord and save it harmless for loss, damage or injury
resulting from the negligent act or omission or tortious conduct of the Landlord
or any person for whom the Landlord is responsible in law and provided further
that the Tenant shall not be liable in any event for any damage or injury
covered by any insurance policy taken out by the Landlord, or which the Landlord
is required to have taken out by any provision of this Lease. If the Landlord
is, without fault on its part, made a party to any 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 (on a substantial indemnity
basis) 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.
Notwithstanding any other provision of this Lease, this indemnification shall
survive any termination of the Lease, with respect to any matter referred to in
this Section which occurs during the Term.
7.15 - HEAT
If the Premises are served by a separate HVAC system or heating system,
the Tenant will heat the Premises at its own expense to a reasonable temperature
to prevent all pipes, plumbing fixtures and equipment contained in or serving
the Premises from bursting or damage.
7.16 - REPLACEMENT OF BULBS
The tenant is responsible for replacing, repairing, installing or
otherwise dealing with its electric light bulbs, ballasts etc, within the
Premises at their sole cost and expense.
7.17 - MAINTENANCE OF SERVICES
The Tenant shall at its cost and expense, install, maintain and repair
pipes, wires, ducts and other installations in, under or through the walls,
ceilings and floors of the Premises for or in connection with the supply of any
services or utilities to the Premises and the Tenant shall have theobligation to
do such work in or to the Premises as the Landlord may deem necessary to
preserve or protect the Premises or the Building. The Landlord shall be entitled
to enter or authorize any other person to enter the Premises to inspect any such
installations, maintenance and repairs.
7.18 - SIGNS
The Tenant shall not erect any signs on the exterior wall of the Building
or which may be visible from the exterior of the Building without the prior
written consent of the Landlord, which consent may not be unreasonably withheld.
The Tenant acknowledges that the Landlord wishes to control the appearance of
the exterior of the Building for the benefit of the Landlord and all tenants of
the Building. If the Landlord, acting reasonably, notifies the Tenant that it
objects to a sign, picture, advertisement, notice, lettering or decoration on
the exterior of the Premises, or in the interior of the Premises but which is
visible from the exterior, the Tenant will remove the offending matter within
seven (7) days after the giving of the notice and repair any damage caused by
the removal. If the offending matter is not removed within the seven (7) days,
then the Landlord or its agents may remove it and, if necessary, enter the
Premises to do so. The Landlord's costs and expenses for such removal and the
repairing of any resulting damages, together with an administrative charge of
fifteen percent (15%) of such costs and expenses, shall be payable, on demand,
by the Tenant to the Landlord, as Additional Rent.
7.19 - SMOKE-FREE BUILDING
The Premises shall be a non-smoking area and the Tenant and its servants,
agents, officers, employees and invitees shall refrain from smoking in the
Building.
7.19 - ENERGY CONSERVATION-CONVERSION OF MEASUREMENT UNITS
The Tenant shall either comply with whatever measures any legislative
authority may from time to time introduce to conserve or to reduce energy
(including, for example, a lighting pulse system) or to reduce or control other
Operating Costs or, if compliance is not deemed mandatory by such legislative
authority, pay as Additional Rent the cost, to be estimated by the Landlord
acting reasonably, of the additional energy consumed by reason of such
non-compliance.
8 - TAXES
8.1 - TENANT'S TAXES
The Tenant will pay all business taxes and all Taxes laid, levied,
assessed or imposed on the Premises or in respect of any personal property,
fixtures, business or other activity carried out by the Tenant on or in
connection with the Premises during the Term. If Taxes are not imposed
separately against the Premises, the Tenant will pay the Tenant's proportionate
share of the Taxes imposed against the Building.
Page 17
8.2 - BUILDING TAXES
(a) Subject to Section 8.3, the Tenant will pay and discharge,
without duplication, the Tenant's proportionate share of all Taxes,
extraordinary as well as ordinary, laid, levied, assessed or imposed on the
Common Facilities and other non-leasable areas of the Building during the Term.
(b) Taxes shall in every instance be calculated on the basis of the
Premises being fully assessed and taxed at prevailing commercial/office building
rates for occupied space for the period for which Taxes are being calculated,
but nothing in this clause shall be interpreted as permitting the Landlord to
recover more than one hundred percent (100%) of Taxes assessed or charged
against the Premises.
(c) If the Premises are at any time during the Term assessed for the
support of separate schools for any reason other than the act, election or
religion of the Landlord, the amount of any increase in the Taxes payable for
the Building shall be paid by Tenant, on demand, as Additional Rent.
(d) The Tenant will pay all Taxes when they become due and payable,
before any interest, penalty, fine or cost may be imposed for late or
non-payment, to the department, officer or bureau charged with their collection
or, if the Landlord requires, the Tenant shall remit its payment to the
Landlord.
(e) In the case of assessments for local improvements or betterments
which are assessed or imposed during the Term and which may by law be payable in
instalments, the Tenant is only obliged to pay the instalments which fall due
during the Term, together with interest on deferred payments, on condition that
the Tenant shall take the steps prescribed by law to convert the payment of the
assessment into instalment payments. Payments of instalments and interest shall
be made before any fine, penalty, interest or cost may be added for late or
non-payment.
(f) In any suit or proceeding of any kind or nature arising from the
failure of Tenant to perform any covenant in this Article, the certificate or
receipt of the department, officer or bureau charged with collection of Taxes,
showing that the Tax, assessment or other charge affecting the Premises (and/or
the Building) is due and payable or has been paid shall be prima facie evidence
that such Tax, assessment or other charge was due and payable as a lien or
charge against the Premises (and/or the Building), or that it has been paid,
respectively.
(g) So long as the Landlord regularly reviews (and where reasonably
required, in the opinion of the Landlord's Consultant, appeals) Taxes or any
related assessments, the Tenant will not contest any Taxes or appeal any
assessments related thereto.
(h) The Tenant will, if applicable, promptly exhibit to Landlord on
request all paid bills for Taxes, which bills after inspection by Landlord shall
be returned to Tenant.
8.3 - PERIODIC PAYMENTS
One-twelfth (1/12) of the amount of Taxes payable by the Tenant to the
Landlord shall be paid monthly during each of the months of January to December,
both inclusive, in each Lease Year, at the times at which Rent is payable. The
Landlord, in its reasonable discretion, may estimate the quantum of Taxes
payable by the Tenant. The Landlord and the Tenant will adjust all payments
under this Section when the final tax bill is received and the Tenant shall pay
the deficiency, if any, on demand, or the Landlord shall credit the Tenant with
any overpayment, such overpayment to be applied in payment of the instalments of
Rent next falling due, or if the Term has expired, the overpayment shall be
repaid to Tenant.
8.4 - OTHER TAXES
The Tenant shall pay to the Landlord GST on the Rent. The amount of GST
shall be calculated by the Landlord in accordance with the applicable
legislation and shall be paid at the same time as the amounts to which GST apply
are payable to the Landlord under this Lease. The Tenant shall not be liable for
GST paid or payable by the Landlord on the purchase of goods and services
included in Operating Costs which may be available to and claimed by the
Landlord as a credit in determining the Landlord's net tax liability or refund
on account of the GST, but only to the extent that such GST is included in
Operating Costs. The GST shall be deemed not to be Additional Rent, but the
Landlord shall have all of the same rights and remedies on non-payment of GST as
it has for Rent in arrears under the Lease. If the Tenant is entitled at any
time during the Term to GST exempt status or to a reduced rate of GST, it shall
reimburse the Landlord for the amount of the shortfall, by reason of such status
or reduced rate, between the input tax credits permitted to the Landlord under
the GST legislation in respect of its ownership and operation of the Building
and the amount of GST collected by the Landlord from the Tenant, to the extent
only that the Landlord is not able to recover the amount of such shortfall from
Canada Customs and Revenue Agency by virtue of such legislation. The Landlord
and the Tenant each covenant to register under the GST legislation for the
purposes of this Section and to maintain such registration in effect at all
times.
Page 18
9 - COVENANTS OF THE LANDLORD
THE LANDLORD COVENANTS AND AGREES WITH THE TENANT AS FOLLOWS:
9.1 - QUIET ENJOYMENT
Provided the Tenant pays all Rent reserved and performs all the Tenant's
covenants contained in this Lease, the Tenant shall have quiet enjoyment of the
Premises free from any hindrance by the Landlord or anyone claiming by or
through the Landlord.
9.2 - FIXTURES
The Tenant, is required to remove its fixtures at the end of the Term. The
Tenant will not remove from the Premises during the Term any fixtures which are
the property of the Tenant, even though there is no Rent in arrears, without the
written consent of the Landlord, which consent may be unreasonably withheld. All
installations, alterations, additions, partitions, and fixtures (other than
trade fixtures) in or on the Premises, or anything in the nature of a leasehold
improvement (the "TENANT'S INSTALLATIONS"), whether placed there by the Tenant
or the Landlord, shall be the Landlord's property on termination of this Lease
without compensation to the Tenant and shall not be removed from the Premises at
any time either during or after the Term. For greater certainty, the Tenant's
trade fixtures shall not include any (i) heating, ventilating or
air-conditioning systems, facilities and equipment serving the Premises; (ii)
floor coverings; (iii) light fixtures; (iv) suspended ceiling and ceiling tiles;
(v) any machinery, equipment, facilities or systems serving the Premises or any
part thereof; and (vi) all partitions within the Premises, all of which, if
erected or installed by the Tenant, are deemed to be Tenant's installations.
Notwithstanding anything in this Lease, the Landlord shall be under no
obligation to repair or maintain the Tenant's installations and the Landlord
shall by notice in writing to the Tenant have the right on the termination of
this Lease by effluxion of time or otherwise to require the Tenant to remove all
or such part of any construction, erections, structures, installations,
machinery and equipment erected, placed or installed on, in or under the Land
Area by the Tenant and require the Tenant to repair the Land Area to its state
prior to any such construction, erection, or installation.
9.3 - MAINTENANCE OF COMMON FACILITIES
The Landlord will maintain and keep the Common Facilities in good repair
in accordance with following provisions:
(a) If the Building or any part of it requires repair, replacement or
alteration, (i) because of the Tenant's use, installations or
machinery or equipment, negligence or misconduct, (ii) due to the
requirements of governmental authorities relating to the Tenant's
conduct of business, or (iii) as a result of the Tenant stopping up
or damaging the heating apparatus, water pipes, drainage pipes or
other equipment or facilities or parts of the Building, the cost of
the repairs, replacements or alterations together with the
Landlord's administrative charge of twenty percent (20%) of the cost
will be paid by the Tenant to the Landlord on demand, as Additional
Rent.
(b) The Landlord will keep and maintain, the landscaped grounds, the
parking facilities, the walkways, internal access roads forming part
of the Common Facilities in good repair and clean condition.
(c) The Landlord will remove ice and snow from the sidewalks, driveways,
private walks, access roads and parking lot whenever reasonably
required.
9.4 - LANDLORD'S TAXES
Subject to the obligations of the Tenant in Article 8, the Landlord will
pay all Taxes levied against the Building.
9.5 - ACCESS
The Tenant agrees forthwith on termination of the Term and delivery up of
possession of the Premises to return to the Landlord all keys or other entry
devices to the exterior doors of the Building which the Landlord may provide to
the Tenant for the purpose of restricting access to the Building at times other
than normal business hours. All heavy furniture, building materials or equipment
will be moved in and out of the Building outside of normal business hours, on
not less than three (3) business days' notice to Landlord and subject to
Landlord's prior consent. Tenant will pay any costs occasioned to the Building
by such movements.
Page 19
10 - ASSIGNING AND SUB-LETTING
10.1 - COVENANT AGAINST ASSIGNMENT
The Tenant will not assign, set over, transfer, sub-let or sub-lease,
hypothecate, encumber or in any way deal with or part with (a "TRANSFER") the
whole or any part of the Premises to anyone (a "TRANSFEREE"), for or during the
whole or any part of the Term, without written consent to the Transfer first
being obtained from the Landlord, but such consent shall not be unreasonably
withheld or delayed.
10.2 - RESTRICTIONS ON ADVERTISING TRANSFER
The Tenant shall not print, publish, post, display or broadcast any notice
or advertisement or otherwise advertise the whole or any part of the Premises
for the purpose of a Transfer, and it shall not permit any broker or other
person to do any of the foregoing, unless the complete text and format of any
such notice or advertisement is first approved in writing by the Landlord.
Without in any way restricting or limiting the Landlord's right to refuse any
text or format on other grounds, any text or format proposed by the Tenant shall
not contain any reference to the Base Rent applicable to the Premises.
10.3 - FACTORS TO BE CONSIDERED
In considering whether to give its consent to a Transfer, the Landlord may
have regard to the financial status, credit rating, reputation and past business
record of the proposed Transferee and its key employees, proposed use consistent
with a first-class Building and its effect on the Landlord's ability to rent
other space in the Building at rental rates consistent with the first-class
nature of the Building, refusal of a Mortgagee to give any consent required
under its security on the Building and any other factors which the Landlord, in
its sole discretion, considers relevant. The Tenant will provide the Landlord
with all information requested by the Landlord in order to enable the Landlord
to consider the request for consent.
10.4 - TERMS OF CONSENT
It is made a condition to the giving of any consent that:
(a) the proposed Transferee shall agree with the Landlord in writing
(to the extent applicable, in the case of a sub-lessee) to assume
and perform all of the terms, covenants, conditions and agreements
by this Lease imposed on the Tenant in a form to be provided by the
solicitor for the Landlord;
(b) if the Landlord consents to an assignment, the Tenant shall
nonetheless remain responsible to the Landlord for the fulfilment of
all obligations created by this Lease; and
(c) the Tenant shall pay to the Landlord a non-refundable amount of
five hundred dollars ($500) in advance plus any legal fees charged
by the Landlord's solicitors in connection with the application for
consent. It is understood that this amount represents a reasonable
cost to the Landlord for reviewing such application.
10.5 - SALE OF TENANT'S BUSINESS
For the purpose of this Section, any sale or other disposition of
whatsoever nature and kind and any issue of shares, merger or statutory
amalgamation resulting in a change in the beneficial ownership, whether directly
or indirectly of the shares of the Tenant or any corporation which has de facto
control over the Tenant, either directly or by reason of the holding of shares
in any other corporation or corporations, shall be deemed to be an assignment by
the Tenant of this Lease. The Tenant shall make available to the Landlord, on
request, all share registers and other books and records in its control relevant
to the determination of whether an assignment has occurred under this Section.
The provisions of this Section shall not apply to a corporation whose shares are
posted for trading on any stock exchange in North America recognized by the
Ontario Securities Commission.
Page 20
10.6 - RIGHT TO TERMINATE
Notwithstanding anything contained in this Lease, if the Tenant from time
to time receives a bona fide offer in writing for the assignment of this Lease
or for the sublet of the whole or any part of the Premises, which the Tenant is
prepared to accept, then prior to acceptance of any such offer, the Tenant shall
provide the Landlord with a signed copy of such offer and the Landlord shall
have the option, exercisable within seven (7) days of receipt of such offer, to
terminate this Lease with respect to that part of the Premises referred to in
such offer. If the Landlord exercises its option, the Tenant may, within three
(3) days thereafter, revoke its application to the Landlord, but if such
application is not revoked, the Tenant shall peaceably surrender and yield up to
the Landlord possession of that part of the Premises referred to in such offer
on the day prior to the date that the proposed assignee or sub-lessee was to
take possession under such offer. If the whole of the Premises shall be
surrendered to the Landlord, this Lease shall then be terminated. Otherwise the
Base Rent payable under this Lease shall be reduced in the proportion that the
Gross Leasable Area of the Premises surrendered is of the total Gross Leasable
Area of the original Premises.
11 - INSURANCE
11.1 - TENANT'S INSURANCE
(a) The Tenant shall throughout the period that the Tenant is given possession
of the Premises and during the entire Term, at its sole cost and expense, take
out and keep in full force and effect, the following insurance:
(i) all-risk property insurance (including but not limited to sprinkler
leakage, flood, earthquake and collapse coverage) in an amount equal
to the full replacement cost thereof upon property of every
description and kind owned by the Tenant or for which the Tenant is
liable, or installed by or on behalf of the Tenant and which is
located within the Premises including, without limitation, tenant's
fixtures, the Tenant's stock-in-trade, furniture and personal
property provided that if there is a dispute as to the amount which
comprises full replacement cost, the decision of the Landlord shall
be conclusive;
(ii) business interruption insurance in such amount as will reimburse the
Tenant for direct or indirect loss of earnings attributable to all
perils insured against in Section 11.1(a)(i) and other perils
commonly insured against by prudent tenants or attributable to
prevention of access to the Leased Premises or the Building as a
result of such perils;
(iii) comprehensive general and legal liability insurance, including
property damage and bodily injury and personal injury liability,
tenant's legal liability, contractual liability and owners' and
contractors' protective insurance coverage with respect to the
Premises and the Tenant's use of the Premises, coverage to include
the activities and operations conducted by the Tenant and any other
person for whom the Tenant is in law responsible. Such policies
shall be written on a comprehensive basis with inclusive limits of
not less than Five Million Dollars ($5,000,000) for bodily injury to
any one or more persons or property damage, and such higher limits
as the Landlord, acting reasonably, or the Mortgagee requires from
time to time, and shall contain a severability of interests clause
and a cross-liability clause;
(iv) if appropriate, broad form comprehensive boiler and machinery
insurance on a blanket repair and replacement basis with limits for
each accident in an amount not less than the full replacement cost
of all Leasehold Improvements and of all boilers, pressure vessels,
air-conditioning equipment and miscellaneous electrical apparatus
owned or operated by the Tenant or by others (other than the
Landlord) on behalf of the Tenant in or serving the Leased Premises;
(v) any other form of insurance which the Landlord, acting reasonably,
requires from time to time in form, in amounts and for risks against
which a prudent tenant would insure.
(b) All policies shall :
(i) be taken out with insurers acceptable to the Landlord;
(ii) be in a form satisfactory from time to time to the Landlord which
form may include a reasonable deductible, the amount of which will
be subject to the Landlord's approval, which approval may not be
unreasonably withheld;
(iii) be non-contributing with and shall apply only as primary and not as
excess to any other insurance available to the Landlord or the
Mortgagee;
(iv) not be invalidated as respects the interests of the Landlord and of
the Mortgagee by reason of any breach or violation of any
warranties, representations or conditions contained in the policies;
(v) contain an undertaking by the insurers to notify the Landlord and
the Mortgagee in writing not less than thirty (30) days prior to any
material change, cancellation or termination thereof; and
(vi) name the Landlord and the Mortgagee as insured parties and, in
respect of property damage insurance, incorporate the Mortgagee's
standard mortgage clause.
Page 21
(c) Certificates of insurance on the Landlord's standard form or if required by
the Landlord or the Mortgagee certified copies of each such insurance policy
will be delivered to the Landlord as soon as practicable after the placing of
the required insurance and in any event at least ten (10) days prior to the
effective date of coverage. Provided that no review or approval of any such
insurance certificate by the Landlord shall derogate from or diminish the
Landlord's rights or the Tenant's obligations contained in this Article.
(d) If the Tenant fails to take out or keep in force any insurance referred to
in this Section 11.1, or should any such insurance not be approved by either the
Landlord or the Mortgagee and should the Tenant not commence to diligently
rectify (and thereafter proceed to diligently rectify) the situation within
twenty-four (24) hours after written notice by the Landlord to the Tenant
(stating, if the Landlord or the Mortgagee does not approve of such insurance,
the reasons therefor), the Landlord has the right without assuming any
obligation in connection therewith to effect such insurance at the sole cost of
the Tenant and all outlays by the Landlord shall be paid by the Tenant to the
Landlord on demand as Additional Rent without prejudice to any other rights and
remedies of the Landlord under this Lease.
11.2 - CONTRACT PROVISIONS
(a) All contracts of insurance placed by the Tenant shall be written
in the names of the Landlord and Tenant as joint insured, and shall to the
extent available show the Landlord, Tenant and any Mortgagee (to an amount that
the Landlord's insurance advisors feel a prudent owner and Landlord should be
insured for) as joint insured, as their interests may from time to time appear,
and shall contain (i) a cross liability clause protecting the Landlord in
respect of claims by the Tenant as if the Landlord were separately insured, and
(ii) a waiver of any subrogation rights which the Tenant's insurers may have
against the Landlord and those for whom the Landlord is at law responsible,
whether any such damage is caused by the act, omission or negligence of the
Landlord or those for whom the Landlord is at law responsible. If both the
Landlord and Tenant have claims to be indemnified under any such insurance, the
proceeds shall be applied first to the settlement of the Landlord's claim, with
the balance to the settlement of the Tenant's claim.
(b) If the Tenant fails to obtain the required policies of insurance, the
Landlord may itself obtain such policies and shall give the Tenant a notice
setting out the amount and dates of payment of all costs and expenses incurred
by the Landlord in that regard to the date of such notice; the Tenant will, with
the next instalment of Rent which becomes due, pay this amount to the Landlord
with interest at the Interest Rate calculated on the various amounts from their
respective dates of payment by the Landlord to the date of repayment by the
Tenant. Any sums so expended by the Landlord, together with such interest, shall
constitute Additional Rent and be due and payable on demand by the Landlord.
(c) The Tenant shall furnish the Landlord with certified copies of
policies or other acceptable evidence of all such insurance promptly on request;
but no review or approval of any such policies by the Landlord shall derogate
from or diminish the Landlord's rights or the Tenant's obligations under this
Article.
(d) The Tenant's proportionate share of the amount of any deductible not
received by the Landlord as proceeds of any policy of insurance shall be payable
by the Tenant as Additional Rent. The amount of any deductible not received by
the Tenant as proceeds of any policy of insurance shall be for the Tenant's own
account. Deductible amounts under any policies shall not exceed those which a
prudent Landlord or Tenant would allow in insuring a similar risk in similar
circumstances.
11.3 - USE OF PREMISES (INSURANCE)
(a) Neither the Tenant nor its officers, directors, agents, servants,
licensees, concessionaires, assignees or sub-Tenants shall bring on the
Premises, nor do, nor omit nor permit to be done or omitted on or about the
Premises anything which shall cause the rate of insurance on the Premises or the
whole or any part of the Building or its contents to be increased. If the rate
of insurance is increased by the use made of the Premises or by anything done or
omitted or permitted to be done or omitted by the Tenant or its officers,
directors, agents, servants, licensees, concessionaires, assignees or
sub-Tenants or by anyone permitted by the Tenant to be on the Premises, the
Tenant shall pay the amount of such increase to the Landlord immediately on
demand.
(b) If any policy of insurance on the whole or any part of the Building or
the contents is cancelled or refused to be renewed or granted by an insurer by
reason of the use or occupation of all or any part of the Premises by the Tenant
or its officers, directors, agents, servants, licensees, concessionaires,
assignees, sub-Tenants or by anyone permitted by the Tenant to be on the
Premises, the Tenant shall immediately on demand remedy or rectify such use or
occupation and if the Tenant shall fail to do so immediately the Landlord may at
its option terminate this Lease by delivering to the Tenant notice in writing of
such termination and the Tenant shall immediately deliver up possession of the
Premises to the Landlord and the Landlord may re-enter and take possession of
the Premises and the Tenant shall immediately pay all Rent and any other payment
for which the Tenant is liable under this Lease, apportioned to the date of such
termination, together with all losses, damages or costs of any kind arising out
of the Tenant's breach of this provision and/or the termination of this Lease
under this paragraph.
Page 22
11.4 - LANDLORD'S INSURANCE
The Landlord shall, except as provided below, at all times throughout the
Term carry:
(a) insurance on the Building and property of every description,
including all mechanical and electrical equipment owned by the
Landlord (specifically excluding any property with respect to which
the Tenant and other Tenants are obliged to insure under Section
11.1 or similar sections of their respective Leases) against all
risks of loss or damage covered under an all risk policy, to their
full replacement cost;
(b) public liability and property damage insurance with respect to
the Landlord's operations in the Building in such reasonable amounts
and with such reasonable deductions as would be carried by a prudent
owner of a reasonably similar Building, having regard to size, age
and location; and
(c) such other form or forms of insurance as the Landlord or the
Mortgagee reasonably considers advisable;
Provided that, if the Landlord shall be unable, from time to time during the
Term, to obtain any of the above coverages on terms or at rates which are, in
the sole and unfettered discretion of the Landlord, commercially reasonable, the
Landlord shall have the right not to obtain or renew such insurance coverages or
to discontinue such coverages, without any liability to the Tenant for having
done so. Subject to the rights of any Mortgagees, the proceeds of any insurance
received by the Landlord in compensation for physical loss or damage to the
Building shall be applied in accordance with the provisions of Article 13.
Notwithstanding any contribution by the Tenant to the cost of insurance
premiums, no insurable interest is conferred on the Tenant under any policies of
insurance carried by the Landlord and the Tenant has no right to receive any
proceeds of any such insurance policies. On written request from the Tenant, the
Landlord will provide a written summary of the Landlord's insurance then in
effect.
12 - REZONING, ADDITIONS
12.1 - REZONING
The Tenant agrees not to oppose any application to conversion of the
Building to a condominium, or for additions to the Building or changes of zoning
for the lands on which the Building is situate, or any lands of the Landlord
within a radius of two (2) kilometres of the Building, which are instituted by
the Landlord, unless the ability of the Tenant to use the Premises for the uses
set out in this Lease would be materially adversely affected by the rezoning. On
the Landlord's request, the Tenant will execute an acknowledgement that it does
not oppose any such application. The Tenant further agrees not to make any
applications or representations to any governmental authority or agency for the
purpose of bringing about, in any way, the amending or varying of the provisions
of any laws, by-laws, rules, regulations or requirements affecting the Premises
or the Building, or any lands on which the Building stands, without the
Landlord's prior written consent, which may in the circumstances be arbitrarily
or unreasonably withheld.
12.2 - ADDITIONS
The Landlord shall have the right to erect additions to the Building in
the area cross hatched as illustrated in Schedule "D" and to alter and relocate
all or any portion of the Common Facilities, including the parking areas, in its
sole and arbitrary discretion, without being responsible to the Tenant for any
loss occurring from such action. The Landlord shall also have the right to
grant, modify and terminate easements or other agreements pertaining to the use
and maintenance of all or parts of the Common Facilities; to close all or any
portion of the Common Facilities to such extent as may in the opinion of the
Landlord's counsel be necessary to prevent accrual of any rights in them to any
persons and to make changes or additions to the pipes, conduits, utilities and
other necessary Building services in the Premises which serve other premises.
None of the changes referred to above shall reduce the size of the Premises or
prevent access to the Premises by the Tenant for the uses set out in this Lease.
The Landlord will make such changes, additions, subtractions or re-arrangements
as expeditiously as reasonably possible. The Landlord shall also have the right
to relocate the Premises within the Building to another location of
approximately the same size within the Building as the Landlord, acting
reasonably, deems equivalent to the present location. If the Landlord elects to
move the Premises, it will pay all costs of constructing the new Premises to the
same standard as the existing Premises including, without limitation, the cost
of moving the Tenant's fixtures and equipment and reinstalling them in the new
location. The Landlord shall not be responsible for any loss or damage
occasioned to the Tenant by such move, or for any indirect or consequential
costs provided that:
(a) after the Commencement Date, the Premises may not be altered,
other than minor relocations of parts of the perimeter walls, or
other boundaries thereof, necessary to accommodate alterations in
construction design or facilities which do not reduce the Gross
Leasable Area of the Premises and other alterations thereto which
shall be limited to those of a minor nature.
Page 23
(b) so long as the Landlord shall not unreasonably interfere with
the Tenant's business in the Premises more than is reasonably
necessary in the conduct of such changes, additions, subtractions or
re-arrangements, the Tenant shall not have any right to object to or
to make any claim on account of the exercise by the Landlord of its
rights under this paragraph 12.2, nor shall the Tenant be entitled
to any abatement of Rent therefore notwithstanding any change in the
size of the Common Facilities, any nuisance, inconvenience or loss
to, interference with or obstructions, interruption, dislocation or
suspension of any utilities or the use of the Common Facilities.
13 - DAMAGE, DESTRUCTION OR EXPROPRIATION
13.1 - ABATEMENT OF RENT
(a) Except as specifically provided in this Article, there shall be
no reduction or abatement of Rent and the Landlord shall not be liable to the
Tenant by reason of any injury to or interference with the Tenant's business or
property arising from fire or other casualty, howsoever caused, or from the
making of any repairs resulting therefrom in or to any portion of the Building
Premises or the Premises. The Tenant agrees that in the event of damage or
destruction to the Premises is covered by insurance, the Tenant shall use the
proceeds of such insurance for the purpose of repairing or restoring such
Premises.
(b) If the Building Premises are damaged or destroyed by any cause
whatsoever, and if, in the opinion of the Landlord reasonably arrived at, the
Building Premises cannot be reconstructed, rebuilt or repaired and made fit for
the purposes of the Tenant within one hundred and eighty (180) days of the
happening of the damage or destruction, the Landlord, may at its option elect to
terminate this Lease by giving to the Tenant Notice of termination within
forty-five (45) days after such damage or destruction, and thereupon Rent and
other payments for which the Tenant is liable under this Lease shall be
apportioned and paid to the date of such damage or destruction, and the Tenant
shall immediately deliver up vacant possession of the Premises to the Landlord
in accordance with the terms of this Lease.
13.2 - DAMAGE IN LAST YEAR OF TERM
If the damage or destruction occurs in the last year of the Term or any
renewal, so that the Premises or the Building are incapable of being rebuilt or
made reasonably fit for occupancy within thirty (30) days from the date of
damage or destruction, the Landlord may terminate this Lease by giving notice
within twenty (20) days after the damage or destruction occurs.
13.3 - LACK OF PROCEEDS
Notwithstanding Section 13.1, if the damage or destruction occurs by
reason of any cause in respect of which proceeds of insurance substantially
sufficient to pay for the cost of rebuilding or making fit the building or the
Premises are not payable to or received by the Landlord, or if any Mortgagee or
other person entitled to the proceeds does not consent to payment to the
Landlord of the proceeds of any insurance policy for such purpose, the Landlord
may terminate this Lease on notice.
13.4 - PROCEDURE ON TERMINATION
On the termination of this Lease under this Article 13, Rent and any other
liabilities of the Tenant shall be apportioned and paid to the date on which the
damage or destruction occurred and the Tenant shall immediately deliver up
possession of the Premises.
13.5 - EXPROPRIATION
(a) If at any time during the Term, all or part of the Building is
acquired or expropriated by any lawful expropriating authority (the
"EXPROPRIATION") or if, in the Landlord's opinion, reasonable access to the
Building is materially affected by any Expropriation, then, at the option of the
Landlord, this Lease shall be terminated as of the date on which the interest
taken by Expropriation vests in the expropriating authority and neither party
shall have any claim against the other for the value of any unexpired Term or
for damages or otherwise. If the Landlord does not elect to cancel this Lease,
this Lease shall continue in effect without any reduction or abatement of Rent,
provided that if any part of the Premises is expropriated, the Rent shall be
adjusted accordingly by the Landlord in the proportion which the Gross Leasable
Area of the remaining Premises is of the original Premises. The full proceeds
resulting from the Expropriation of any portion of the Building shall belong
solely to the Landlord. The Tenant will execute all documents necessary in the
Landlord's opinion for this purpose.
Page 24
(b) The Tenant shall have the right to recover from the
expropriating authority, but not from the Landlord, such compensation as may be
separately available to the Tenant in the Tenant's own right by reason of the
Expropriation for damage to the Tenant's business and on account of any cost or
loss of the Tenant in removing its chattels, fixtures, and leasehold
improvements.
(c) The Landlord and the Tenant agree to keep each other fully
informed about their respective claims for compensation, that each of them will
not claim compensation on any basis inconsistent with this Lease and each will
reasonably cooperate with the other in the prosecution of their proper separate
claims. Neither party shall compromise the claim of the other party without its
prior written consent.
13.6 - REPAIR OF DAMAGE
If the Building is damaged or expropriated to the extent described in
Sections 13.1 or 13.5 and the Landlord does not terminate this Lease, the Tenant
will promptly rebuild or repair the Building, subject to the express terms and
conditions of this Lease. The Tenant shall repair and restore the Premises
according to the nature of the damage with all reasonable diligence, except for
improvements installed by the Tenant which the Tenant shall repair and restore,
in both cases, to substantially the condition they were in immediately before
the damage or destruction, but to the extent that any part of the Premises is
not reasonably capable of use by reason of damage which the Tenant is obligated
to repair, any abatement of Rent to which the Tenant is otherwise entitled shall
not extend later than the time by which, in the reasonable opinion of the
Landlord's Consultant, repairs by the Tenant ought to have been completed with
reasonable diligence. The Tenant shall pay the cost of the repair and
restoration of all destruction which is attributable to the wilful act or
neglect of the Tenant, its servants or agents, or any person entering on the
Premises under express or implied invitation of the Tenant, and in such case,
there shall be no abatement of Rent.
13.7 - CONSULTANT'S DETERMINATION
A Consultant's Certificate as to the length of time required, using
reasonable diligence, to rebuild or restore the Building or the Premises, or as
to when all or any portion of the Premises are reasonably fit for occupancy by
the Tenant shall be conclusive and binding on the Landlord and the Tenant.
14 - TENANT'S DEFAULT
14.1 - REMEDIES OF LANDLORD
If the Tenant fails:
(a) to make any payment of Rent, in whole or in part, for five (5)
days after its due date; or
(b) to perform or observe any other covenants, provisos or
agreements contained in this Lease and such failure shall continue
for fifteen (15) days after notice; the Landlord shall have the
following remedies in each such case:
(C) - TERMINATION
The Landlord may without further notice terminate this Lease, in
which case the then current month's Rent and the next ensuing three
(3) months' Rent and any other payments for which the Tenant is
liable shall be apportioned and paid in full to the date of
termination, together with the reasonable expenses of the Landlord
attributable to the termination, and the Tenant shall immediately
deliver up possession of the Premises to the Landlord; any
termination of the Lease will be without prejudice to any other
rights or remedies the Landlord may have, including, without
limitation, the right to receive compensation for loss of future
Rent and for loss or diminution of revenue from the Building; for
the purposes of this clause, loss of future Rent and loss of revenue
will be established by the terms and conditions on which the
Landlord, in its sole discretion, re-lets the Premises, if such
re-letting is accomplished within a reasonable time after
termination, but if the Premises are not re-let, such values will be
based on the fair market rental for properties of a similar nature
in the Municipality and other relevant circumstances. Rent, rental
value and loss of revenue will be reduced to their present value at
a discount rate of ten percent (10%), on the basis of estimates and
assumptions of fact made by the Landlord, which will govern;
(D) - RECOVERY OF EXPENSES
The Landlord may enter the Premises and perform the obligation on
behalf of the Tenant, and shall not be liable for any loss or damage
to the Tenant's goods, chattels, fixtures and leasehold improvements
or business caused in so doing. Any reasonable expenses incurred by
the Landlord in so doing (including, without limitation, legal fees
and compensation for the Landlord's services, as well as Landlord's
management fee of fifteen percent (15%) of these expenses and
compensation) shall be paid by the Tenant to the Landlord as
Additional Rent on demand;
Page 25
(E) - RIGHT TO RELET
The Landlord shall have the right to enter the Premises and to relet
them as agent for the Tenant for whatever term and on whatever
conditions the Landlord shall, in its sole discretion, deem
advisable, and the Tenant shall pay to the Landlord, in monthly
instalments for the balance of the Term of this Lease (which shall
be deemed for the purposes of this clause 14.1(e) not to have been
terminated by any action of the Landlord under this Section,
including the making of alterations to the Premises deemed by the
Landlord to be necessary or advisable for the purpose of reletting
them), any deficiency between the sum of one-twelfth (1/12) of the
Rent payable under this Lease and the net amount, if any, of Rent
actually received by the Landlord in respect of the Premises, after
deducting all amounts reasonably attributable to the reletting of
all or part of the Premises. For greater clarity, the Landlord, in
the exercise of its discretion under this clause, may enter into a
reletting of all or part of the Premises for a term which may extend
beyond the expiry date of the Term, without being deemed to have
terminated the Lease or the rights of the Landlord under this
clause.
14.2 - CURE DEFAULT
If the Tenant's default can be cured only by the performance of work or by
the furnishing of materials, and if the work cannot reasonably be completed or
the materials reasonably obtained and/or utilized within fifteen (15) days, the
default shall not be deemed to continue if the Tenant proceeds promptly with and
diligently completes the work necessary to cure the default.
14.3 - CONSTRUCTION LIENS
The Tenant shall indemnify and hold the Landlord harmless from and against
any liability, claim, damages or expenses (including legal expenses) arising
from any claim made against the Premises or the Building for construction liens
related to work done by or on behalf of the Tenant and all work which the Tenant
is obliged to do and any such liabilities, claims, damages or expenses incurred
by the Landlord shall be paid by the Tenant to the Landlord on demand. The
Tenant shall cause all registrations of claims for construction liens and/or
certificates of action under the Construction Lien Act for any work done by or
on behalf of the Tenant, and all work which the Tenant is obliged to do, to be
discharged or vacated, as the case may be, within fifteen (15) days of such
registration or within five (5) days after notice from the Landlord, failing
which the Landlord, in addition to any other rights or remedies it may have,
may, but shall not be obligated to, discharge such liens and/or certificates by
payment to the claimant, payment into court, or otherwise; any such payments and
the Landlord's legal costs (on a substantial indemnity basis) and other costs of
obtaining and registering such discharges shall be repaid by the Tenant to the
Landlord on demand as Additional Rent.
14.4 - DISTRESS
The Tenant 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 Premises at any time during the Term shall be
exempt from levy by distress for Rent or any other charges. The Tenant agrees to
provide the Landlord with a key which will at all times open the locks to the
Premises and expressly licences and authorizes:
(a) the Landlord to use the key for the purposes of effecting entry
to the Premises to distrain on the goods and chattels of the Tenant
or to prevent the Tenant from removing them; if the Landlord does
not have the key or is unable to gain access to the Premises by the
use of the key, the Tenant expressly licences and authorizes the
Landlord to use any other means of ingress for the purpose of
effecting distress as the Landlord may in its sole discretion
determine including, without limitation, the breaking of the lock or
of any window without being liable for any damages or prosecution
for doing so;
(b) the Landlord to distrain at any time of the day or night
including, without limitation, after sunset, before sunrise and on
Sundays and statutory holidays;
(c) to levy distress against such goods and chattels at any place to
which the Tenant or any other person may have removed them, in the
same manner as if they had remained on the Premises;
(d) to sell any goods and chattels seized at public or private sale,
without notice, and to apply the net proceeds of such sale on
account of the Rent or any other sums due under this Lease, and
Tenant shall remain liable for any deficiency. The Tenant shall pay
to the Landlord on demand, to the extent not recovered out of any
distress, all fees and expenses of levying distress including,
without limitation, all legal, locksmith, bailiff, appraiser and
auctioneer fees, together with three (3) months' accelerated Rent.
Page 26
The Tenant expressly gives its consent to Canada Customs and Revenue Agency, the
Ontario Ministry of Finance and all other federal, provincial and municipal
taxing authorities (the "AUTHORITY") releasing to the Landlord and its duly
authorized agent the particulars of any amounts owing by the Tenant to the
Authority, to the extent that the Authority claims priority over the Landlord
against any proceeds in the hands of the Landlord or its agent from realization
against the property of the Tenant.
All goods and chattels brought by the Tenant onto the Premises shall be the
unencumbered property of the Tenant and they shall not be subjected to any claim
or other encumbrance at any time without the prior written consent of the
Landlord. If the Tenant shall leave the Premises leaving any Rent or other
amounts owing under this Lease unpaid, the Landlord, in addition to any other
available remedy, may seize and sell the goods and chattels of the Tenant at any
place to which the Tenant or another person may have removed them in the same
manner as if such goods and chattels had remained and been distrained on the
Premises.
14.5 - INTEREST
All sums for Rent or otherwise payable to the Landlord under the terms of
this Lease shall bear interest at the Interest Rate in effect on their
respective due dates until the actual dates of payment.
14.6 - APPLICATION OF RECEIPTS
The Landlord may, at its option, apply all sums received from the Tenant
to any Rent or other amount payable under this Lease in such order as the
Landlord sees fit. If applied to Rent, any payment is on account of the earliest
stipulated Rent. An endorsement or statement on a cheque or letter accompanying
a cheque or payment as Rent is not an acknowledgement of full payment or an
accord and satisfaction, and the Landlord may accept and cash the cheque or
payment without prejudice to its right to recover the balance of the Rent or
pursue its other remedies.
14.7 - PROTECTION OF LANDLORD
Subject to any express provision of this Lease, the exercise by the
Landlord of any of the rights and remedies reserved to it under this Article 14
shall not, notwithstanding anything to the contrary in any law or statutory
provision, except to the extent that Tenant may not legally contract out of any
right or protection therein given to it:
(a) require the service of any notice or demand by the Landlord to
the Tenant of any default by the Tenant in the payment of Rent or
performance of its covenants;
(b) require the resort by the Landlord to any legal proceedings;
(c) constitute (1) a breach of the covenant for quiet possession;
(2) an actual or constructive eviction; (3) a forfeiture, surrender
or termination of this Lease, or (4) a re-entry into the Premises;
unless Landlord elects in writing to effect such forfeiture,
surrender, termination or re-entry;
(d) render Landlord liable or responsible in any way to Tenant or
others for any act, fault, occurrence or for any cause whatsoever,
including without limitation, (1) any injury, personal discomfort or
death to any person or for any loss or damage to any property of
Tenant or others, and (2) any claim for damages, whether direct,
indirect or consequential; or
(e) render Landlord subject to any prosecution;
and the Tenant shall promptly indemnify and hold the Landlord harmless from any
and all claims arising out of the exercise by the Landlord of any of the rights
set out in this Lease. Any breach by the Landlord under this Lease can be
adequately compensated in damages and the Tenant agrees that its only remedy to
enforce its rights under this Lease is an action for damages.
14.8 - ABANDONMENT OF GOODS
Any goods, chattels, fixtures, inventory, equipment and other property of
the Tenant not removed from the Premises within seven (7) days from the date of
expiry of the Term, shall be deemed to have been abandoned by the Tenant and the
Landlord may remove and dispose of them (by private or public sale), destroy
them, retain them or convey them to a new tenant or otherwise deal with them in
any manner whatsoever without compensation to the Tenant.
14.9 - LIEN ON TRADE FIXTURES
If, at any time during the period of time the Tenant is in possession of
the Premises, the Tenant is in default under any covenant or obligation
contained in this Lease, the Landlord has a lien on all stock-in-trade,
inventory, fixtures, equipment and facilities of the Tenant as security against
loss or damage resulting from any such default and the stock-in-trade,
inventory, fixtures, equipment or facilities shall not be removed from the
Premises by the Tenant until the default is cured, unless otherwise permitted in
writing by the Landlord. The Landlord shall have the right to enter the Premises
to enforce its lien and shall have all of the rights and remedies of a secured
creditor in possession under the Personal Property Security Act (Ontario).
Page 27
15 - BANKRUPTCY, ETC.
15.1 - TENANT'S INSOLVENCY
Without prejudice to any other rights or remedies available to the
Landlord, if:
(a) the Term or any of the goods and chattels of the Tenant on the
Premises are seized or taken in execution or attachment by any
creditor of the Tenant (including, without limitation, if a
receiver or receiver and manager shall enter into possession
of the Premises);
(b) the Tenant makes any assignment for the benefit of creditors,
or any bulk sale of goods on the Premises, except in the
ordinary course of its business, or in conjunction with a
permitted Transfer under this Lease:
(c) the Tenant, becoming bankrupt or insolvent shall take the
benefit of any Act for bankrupt or insolvent debtors;
(d) a receiving order is made against the Tenant;
(e) an order is made for the winding up of the Tenant;
(f) the Premises shall without the written consent of the Landlord
become and remain vacant for a period of four (4) days, or be
used by any other persons than those entitled to use them
under the terms of this Lease;
(g) the Tenant, without the written consent of the Landlord,
abandons or attempts to abandon the Premises or, except in the
ordinary course of its business, to sell or dispose of its
chattels or to remove any of them from the Premises, so that
there would not be sufficient chattels on the Premises subject
to distress to satisfy the Rent due or accruing due;
(h) the Premises are used for any other purpose than this Lease
permits;
then, in every such case, the then current month's Rent and the next ensuing
three (3) months' Rent, together with all additional charges payable by the
Tenant under this Lease (to be pro rated, if necessary), shall immediately
become due and payable and the Landlord may re-enter and take possession of the
Premises as though the Tenant or the servants of the Tenant or any other
occupant of the Premises were holding over after the expiration of the Term, and
the Term shall, at the option of the Landlord, immediately be terminated. In
every one of the cases described above, the three (3) months' accelerated Rent
shall be recoverable by the Landlord in the same manner as the Rent.
16 - NOTICES
16.1 - DELIVERY OF NOTICES
All notices, payments, consents, demands or other documents required or
which may be given under this Lease (the "DOCUMENTS") shall be in writing, duly
signed by the party giving such notice and delivered or transmitted by
registered or certified mail addressed as follows or sent by facsimile (with
confirmation of transmission) to a receiver at the addresses set out on the
front page of this Lease. Any document so given shall, unless delivered, be
deemed to have been received on the second business day following the date of
mailing, if sent by registered or certified mail, or on the first business day
after the date of transmission by facsimile. If the postal system is disrupted
by labour strike, such document shall be delivered or sent by facsimile. Any
party may from time to time by notice given as provided above change its address
for service of documents.
17 - LANDLORD'S COSTS AND CONSENTS
17.1 - LEGAL COSTS
If the Landlord brings an action for collection of Rent or other sums
payable under this Lease, or if such sums shall be collected on the demand of a
solicitor, or if the Landlord brings an action to compel performance of any of
the terms, conditions, covenants or provisos under this Lease or for damages for
failure of the Tenant to perform any of them, or if they are performed on the
demand of a solicitor then, unless the Landlord shall lose such action, the
Landlord shall collect from the Tenant and the Tenant shall pay to the Landlord
all reasonable solicitor's fees for such action on a substantial indemnity
basis.
Page 28
17.2 - OTHER EXPENSES
The Tenant shall pay the cost of obtaining any Consultant's Certificate
requested by the Tenant. If this Lease requires the Tenant to obtain the consent
or authorization of the Landlord to any action proposed by the Tenant, or if the
Tenant requests an acknowledgement from the Landlord, the Tenant shall pay, as
Additional Rent, the Landlord's reasonable legal and administrative fees,
including a charge for Landlord's administrative time, and disbursements for
reviewing and considering the matter and for preparation of any documents which
the Lease may require for this purpose. These fees shall be payable even if the
Landlord, in the proper exercise of any discretion given to it in this Lease,
shall refuse to give its consent or authorization.
18 - PRIOR INTERESTS
18.1 - MORTGAGEE'S PRIORITY
(a) At the option of the Landlord, to be expressed in writing from
time to time, this Lease and the rights of the Tenant are and shall be subject
and subordinate to all Mortgages and all renewals, modifications,
consolidations, replacements and extensions of them which may now or in future
affect the Premises or the Building in whole or in part and whether or not such
Mortgages shall affect only the Premises or the Building of which the Premises
form part or shall be blanket mortgages or deeds of trust affecting other
premises as well. The Tenant shall at any time on notice from the Landlord or a
Mortgagee attorn to and become a tenant of a Mortgagee under any such Mortgage
on the terms and conditions of this Lease and shall execute promptly on request
by the Landlord any instruments of postponement or attornment or other
instruments from time to time requested to give full effect to this requirement.
If the Tenant fails to execute any instrument or other document as required by
this Section within ten (10) days after request by the Landlord, then the
Landlord will have the right to terminate this Lease or to execute any such
instrument or document on behalf of the Tenant and in the Tenant's name, for
which purpose the Tenant irrevocably constitutes the Landlord the agent or
attorney of the Tenant under the Powers of Attorney Act (Ontario).
(b) The form and content of any document effecting the subordination
and attornment provided for in Section 18.1(a) will be that required by the
Mortgagee in each case, and such document will be delivered by the Tenant to the
Landlord within ten (10) days after the Landlord requests it.
(c) If the Landlord assigns its rights under this Lease as security
for a Mortgage and notification of the assignment is given to the Tenant by or
on behalf of the Landlord, this Lease shall not be cancelled or modified for any
reason whatsoever, except as provided for in this Lease or by law, without the
prior written consent of the Mortgagee.
18.2 - PRIORITY OF LEASE
The Tenant agrees that any Mortgagee at any time by an instrument in
writing registered against the title to the Building may subordinate its
Mortgage to this Lease without any further consent or agreement of the Tenant.
18.3 - ACKNOWLEDGEMENTS OR STATEMENTS
(a) The Tenant at any time and from time to time on not less than
seven (7) days prior notice, shall execute and deliver to the Landlord a
statement in writing certifying that this Lease is unmodified and in full force
and effect (or if modified, stating the modifications and that the Lease is in
full force and effect as modified), the amount of the Base Rent then being paid,
the dates to which the Rent, by instalment or otherwise and other sums payable
under the Lease have been paid, stating whether or not there is any existing
default on the part of the Landlord of which the Tenant has notice, the
particulars and amount of insurance policies on the Premises in which the
interest of the Landlord is noted, the amount of prepaid Rent or security
deposit being held by the Landlord, the area of the Premises and the Tenant's
proportionate share for payment of Taxes, Operating Costs or other expenses,
whether all Landlord's work in construction of the Premises or any leasehold
improvements has been completed and whether or not there is any claim, charge,
defence, right to set off or counter-claim by the Tenant against the Landlord in
respect of Rent or otherwise;
(b) Any statement delivered under this Section may be conclusively
relied on by any purchaser or prospective purchaser or any Mortgagee of the fee
or the leasehold or any other sub-lessee or prospective sub-lessee, except for
any default of the Landlord of which the Tenant does not have notice at the date
of the statement. If the Tenant fails to execute and deliver any such statement
within seven (7) days of written request by the Landlord, the Landlord shall
have the right to execute and deliver the statement by and on behalf of the
Tenant and such statement shall be binding on the Tenant;
(c) From time to time at the request of the Landlord, the Tenant
shall deliver to the Landlord the Tenant's most recent financial statements,
together with such other financial information and for such periods of time as
may be requested by a Mortgagee or prospective purchaser of the Building. The
Tenant consents to the Landlord performing a credit check at any time or times
during the Term.
Page 29
18.4 - RIGHTS OF MORTGAGEES
If at any time during the currency of a Mortgage in favour of a Mortgagee
who has given notice in writing of the Mortgage to the Tenant the Landlord
defaults in the performance of any provision of this Lease which would give rise
to a right in the Tenant to terminate this Lease, then the Tenant, before
becoming entitled as against the Mortgagee to exercise any right to terminate
this Lease, shall give the Mortgagee notice in writing of this default. The
Mortgagee shall have sixty (60) days after the giving of the notice, or such
longer period as may be reasonable in the circumstances, within which to remedy
the default. If the default is remedied within that time, the Tenant shall not
by reason of the default terminate this Lease. The rights and privileges granted
to a Mortgagee in this Section shall not in any way be deemed to alter, affect
or prejudice any of the rights and remedies available to the Tenant as against
the Landlord. Any notice to be given to a Mortgagee shall be deemed to have been
properly given if mailed by registered mail to its most recent address of which
the Tenant shall have notice.
18.5 - NON-DISTURBANCE AGREEMENT
The Tenant's obligation to execute an agreement subordinating this Lease
or to attorn to a Mortgagee is subject to the Mortgagee agreeing, on its usual
terms, to permit the Tenant to continue in occupation of the Premises, provided
that the Tenant is not in default under this Lease and continues to pay all Rent
and perform all of its covenants, conditions and agreements.
19 - MONTHLY TENANCY
19.1 - MONTHLY TENANCY
If the Tenant continues to occupy the Premises after the expiration of the
Term or any renewal period, with the consent of the Landlord and without any
renewal or further written agreement, the Tenant will be a monthly tenant at a
monthly rental equal to double the monthly instalment of Base Rent payable
during the last month of the Term or immediately preceding renewal, together
with the Additional Rent provided in this Lease. Rent will be payable in advance
on the first day of each and every month of the tenancy and the monthly tenancy
will be on the terms and conditions and subject to all other charges and amounts
payable under this Lease, except as to length of tenancy.
20 - GENERAL
20.1 - NO WAIVER OF DEFAULT
No condoning, excusing, overlooking or delay in acting by the Landlord of
any default, breach or non-observance by the Tenant at any time or times in
respect of any covenant, proviso or condition in this Lease shall operate as a
waiver of the Landlord's rights under this Lease in respect of any continuing
subsequent default, breach or non-observance and no waiver shall be inferred
from or implied by anything done or omitted by the Landlord except an express
waiver in writing.
20.2 - REMEDIES CUMULATIVE
All rights and remedies of the Landlord set forth in this Lease shall be
cumulative and not alternative.
20.3 - ASSIGNMENT BY LANDLORD
(a) If the Landlord assigns this Lease to a Mortgagee or to any
other person the Landlord shall nonetheless be entitled to exercise all rights
and remedies reserved under this Lease without providing evidence of the
approval or consent of the Mortgagee or other person.
(b) If the Landlord sells the Building and assigns this Lease to the
purchaser, and the purchaser agrees in writing with the Landlord to assume all
of the obligations of the Landlord under this Lease, the Landlord shall, on
completion of the sale and assignment of Lease, be relieved of all personal
liability of any nature and kind whatsoever under this Lease and the purchaser
shall be deemed to be the Landlord under this Lease for all purposes, subject to
the provisions of this Section.
20.4 - NO PARTNERSHIP
The Landlord does not in any way or for any purpose become a partner of
the Tenant, in the conduct of its business or otherwise, or a joint venturer or
a member of a joint enterprise with the Tenant, nor is the relationship of
principal and agent created by this Lease or any dealings between the Landlord
and the Tenant.
20.5 - NO OPTION
The submission of this Lease for examination does not constitute a
reservation or option for the Premises and this Lease becomes effective as a
Lease only on its execution and delivery by the Landlord and the Tenant.
Page 30
20.6 - REGISTRATION OF NOTICE
The Tenant shall not register this Lease without the written consent of
the Landlord. However, the Tenant shall be entitled to register a Notice of
Lease; provided that such Notice shall only describe the parties, the Premises,
the Term and any renewal, or any restrictive covenants. Any Notice of Lease
shall be prepared by the Tenant's solicitors, but shall be subject to the
approval of the Landlord and its solicitors and shall be registered at the
Tenant's expense. The Tenant shall bear the reasonable costs of the Landlord
with respect to the review by the Landlord's solicitors of the Notice of Lease.
20.7 - RULES AND REGULATIONS
The Tenant and its officers, directors, servants, agents and all persons
visiting or doing business with it shall be bound by and shall observe the rules
and regulations attached to this Lease as Schedule "C" and any other reasonable
rules and regulations made by the Landlord from time to time of which notice
shall be given to the Tenant, and all such rules and regulations shall be deemed
to be incorporated into and form part of this Lease. The Landlord shall enforce
the rules and regulations against all occupants of the Building, but in so doing
need not institute any legal action. The Landlord shall not be liable to the
Tenant as a result of its failure or inability to enforce the rules and
regulations against the other tenant of the Building.
20.8 - NO CONTRA PROFERENTUM
This Lease has been negotiated and approved by the Landlord and the Tenant
and, notwithstanding any rule or maxim of law or construction to the contrary,
any ambiguity or uncertainty will not be construed against either Landlord or
Tenant by reason of the authorship of any of the provisions contained in this
Lease.
21 - DELAYS
21.1 - UNAVOIDABLE DELAY
Whenever, and to the extent that either party shall be unable to fulfil,
or shall be delayed or restricted in the fulfilment of any obligation under this
Lease in respect of the supply or provision of any service or utility or the
doing of any work or the making of any repairs by reason of strike, lock-out,
war, act of God or by reason of being unable to obtain material, goods,
equipment, services, utility or labour required to enable it to fulfil such
obligation or by reason of any statute, law or order-in-council, or any
regulation or order passed or made under any legislative authority, or by reason
of the order or direction of any administration, controller or board, or any
governmental department or officer or other authority, or by reason of not being
able to obtain any required permission or authority, or by reason of any other
cause beyond its control, whether of the foregoing character or not, such party
shall, so long as any such impediment exists, be relieved from the fulfilment of
such obligation and the other party shall not be entitled to compensation for
any damage, inconvenience, nuisance or discomfort thereby occasioned, but
nothing in this Section shall excuse the Tenant from payment of or entitle it to
withhold Rent.
21.2 - FAILURE OF LANDLORD TO DELIVER POSSESSION
Notwithstanding any other provision of this Lease, and in addition to the
provisions of Section 21.1, the Landlord shall not be deemed in default if it is
unable to give possession of the Premises on the date fixed for commencement of
the Term because of the holding over or retention of possession of any prior
lessee or occupants, or because repairs, improvements or decorations of the
Premises or of the Building are not completed, or for any reason other than the
Landlord's wilful act or neglect. In such circumstances, the Rent will not
commence until possession of the Premises is given to the Tenant or the Premises
are available for fixturing by the Tenant, and no failure to give possession of
the Premises on the date fixed for commencement of the Term shall in any way
affect the validity of this Lease or the obligations of the Tenant under this
Lease or the terms or conditions of this Lease, nor shall it extend the Term.
The Landlord shall diligently exercise its rights to obtain completion and/or
vacant possession of the Premises as soon as reasonably possible. There shall be
no abatement of Rent for any delay in occupancy due to the Tenant's failure to
complete all or any installations or other work required to be completed by the
Tenant in accordance with the provisions of this Lease or required for the
purpose of carrying on its business operations in the Premises. The Tenant shall
not be entitled to any abatement of Rent where the Landlord's failure to
complete or deliver vacant possession of the Premises on the Commencement Date
is due to any act or omission on the part of the Tenant. The decision of the
Landlord's Consultant shall be final and binding on the parties as to whether or
not the Premises are ready for occupancy by the Tenant, and as to the extent to
which any delay in completion of the Premises or in the delivery of vacant
possession is due to any act or omission of the Tenant or its agents, servants
or contractors. The Tenant shall, promptly on the request by the Landlord,
execute an acknowledgement of the date on which complete and vacant possession
of the Premises is delivered to the Tenant. If the Landlord has not delivered
possession of the Premises within eighteen (18) months of the date of this
Lease, the Landlord shall have the right and option at any time to cancel this
Lease and any money or security deposited with the Landlord under or on account
of this Lease shall be returned to the Tenant and neither party shall have any
liability to the other.
Page 31
IN WITNESS WHEREOF the parties have executed this Lease as of the 20th day
of April, 2006.
FERCAN DEVELOPMENTS INC.
Per: /s/ Vince DeRosa
--------------------------------
Vince DeRosa, President
I have authority to bind the corporation
NORTHERN ETHANOL (BARRIE) INC.
Per: /s/ Gord Laschinger
--------------------------------
Name: Gord Laschinger-President
I have authority to bind the corporation
SCHEDULE "A" - LEGAL DESCRIPTION
PIN Number: 58734-0250(LT)
Part Lots 7 and 8, Concession 12, Innisfil, being parts 2,3 and 4 on Plan
51R-30453, subject to and together with the rights set out in instrument No.
R01461677, Barrie
SCHEDULE "B" - SKETCH OF BUILDING PREMISES
Building Premises illustrated in black
SCHEDULE "B-1"- SKETCH OF LAND AREA
Land Area illustrated in black
SCHEDULE "C" - RULES AND REGULATIONS
The Tenant agrees as follows:
1. All loading and unloading of supplies, materials, garbage and other
chattels shall be effected only through or by means of such doorways or
corridors as Landlord shall designate.
2. The delivery or shipping of supplies and fixtures to and from the
Premises shall be subject to such rules and regulations as in the
judgment of Landlord are necessary for the proper operation of the
Premises.
3. All garbage and refuse shall be kept in the kind of covered container
specified by Landlord, sorted as specified by the Landlord for the
purposes of any recycling program established by the Landlord or the
Municipality, and shall be placed outside of the Premises prepared for
collection in the manner and the times and places specified by
Landlord. If Landlord provides or designates a service for picking up
refuse and garbage, Tenant shall use it at Tenant's cost. Tenant shall
pay the cost of removal of any of Tenant's refuse or rubbish.
4. The Tenant shall use at the Tenant's cost, the pest extermination
contractor directed by the Landlord and at the intervals required by
the Landlord.
5. No animals or birds, except for guide dogs, shall be brought into or
kept in or about the Premises.
6. If the Tenant desires telegraph, telephone, paging or other private
signal connections, Landlord reserves the right to direct the
electricians or other workmen as to where and how the wires are to be
introduced and without such directions no boring or cutting for wires
shall take place. No other wires of any kind shall be introduced
without the written consent of Landlord.
7. No one shall use the Premises for sleeping apartments or residential
purposes as defined in the Commercial Tenancies Act or the Tenant
Protection Act, 1997.
8. The Tenant agrees to install at its own expense a lock approved by the
Landlord, on all doors of the Premises and to supply Landlord with two
keys. The Landlord may from time to time install and change locking
mechanisms on entrances to the Building, the Common Facilities and the
Premises, and (unless 24 hour security is provided by the Building)
shall provide to Tenant a reasonable number of keys and replacement
keys ("KEYS") include any device serving the same purpose). The Tenant
shall not add to or change existing locking mechanisms on any door in
or to the Premises without the Landlord's prior written consent. If
with Landlord's consent, the Tenant installs lock(s) incompatible with
the Building master locking system:
(a) the Landlord, without abatement of Rent, shall be relieved of
any obligation under this Lease to provide any service to the
affected areas during times when such areas are locked and the
Tenant is not available to provide access;
(b) the Tenant shall indemnify Landlord against any expenses as a
result of a forced entry to the affected areas which may be
required in an emergency; and
(c) the Tenant shall at the end of the Term and at Landlord's
request remove such lock(s) at the Tenant's expense.
9. The Tenant shall give the Landlord prompt written notices of any
accident, or any defect in the water pipes, gas pipes, heating or
cooling apparatus, telephone or electric light or other wires in any
part of the Premises which comes to the attention of the Tenant.
10. The Tenant shall not place on, obstruct or in any manner conduct
business operations on the Common Facilities or distribute handbills or
other advertising matter in the Common Facilities without the written
consent of the Landlord.
11. The Landlord shall have the right to make further reasonable rules and
regulations and to alter, amend or cancel all rules and regulations as
in its judgment may from time to time be needed and all such rules and
regulations, to the extent they are applicable to the Tenant, shall be
kept and observed by Tenant. The Landlord may from time to time waive
any of such rules and regulations and is not liable to Tenant for
breaches of them by the other tenant.
SCHEDULE "D" - LANDLORD'S PERMITTED EXPANSION,
ADDITION AND BUILD AREA
Area illustrated in black
SCHEDULE "D-1"- TENANT'S PERMITTED DEMOLITION
AREA
Area illustrated in black
TABLE OF CONTENTS
PAGE
1 - BASIC TERMS 1
1.1 Term 1
(b) Commencement Date 1
(c) Expiry of Term 1
1.2 Base RentERROR! BOOKMARK NOT DEFINED.
1.3 Tenant's Estimates proportionate share
of Operating Costs and Realty Taxes
1.4 Deposit 1
1.5 Use of Premises 1
1.6 Option to Extend 2
1.7 Tenant's Work 1
1.8 Fixturing Period 2
2 - INTERPRETATION 3
2.1 - Definitions 3
2.2 - Severability 8
2.3 - Number 8
2.4 - Headings 8
2.5 - Entire Agreement 8
2.6 - Successors 9
2.7 - Net-Net and Carefree Lease 9
2.8 - Metric Conversion 9
2.9 - Landlord's Consent 9
ERROR! BOOKMARK NOT DEFINED.
2.10 Building Standard 9
3 - PREMISES 9
3.1 - Demise of Premises 9
4 - COMMON FACILITIES 9
4.1 - Use of Common Facilities 9
5 - TERM 9
5.1 - Term of Lease 9
5.2 - Planning Act 10
6 - RENT 10
6.1 - Base Rent 10
6.2 - Monthly Instalments - Additional
Rent 10
6.3 - Deposit 10
6.4 - Payment Arrangements 10
6.5- GST
6.6 - Remedies 10
7 - COVENANTS OF THE TENANT 11
7.1 - Pay Rent 11
7.2 - Utilities 11
7.3 - Maintenance 11
7.4 - Repairs and Maintenance 11
7.5 - Comply With All Laws 12
7.6 - Use and Operation 12
7.7 - Landlord's Recovery 13
7.8 - Waste 13
7.9 - Compliance with Environmental
Legislation 14
7.10 - Electrical and Other Service
Facilities 14
7.11 - Alterations 14
7.12 - Right to Show Premises 15
7.13 - Liability to Invitees, Licensees 15
7.14 - Tenant's Indemnity of Landlord 15
7.15 Heat 13
7.16 - Replacement of Bulbs 16
7.17 - Maintenance of Services 16
7.18 - Signs 16
-7.19 -Smoke-free Building 16
7.20 - Energy Conservation-Conversion
of Measurement Units 16
8 - TAXES 16
8.1 - Tenant's Taxes 16
8.2 - Building Taxes 17
8.3 - Periodic Payments 17
8.4 - Other Taxes 17
9 - COVENANTS OF THE LANDLORD 18
9.1 - Quiet Enjoyment 18
9.2 - Fixtures 18
9.3 - Maintenance of Common Facilities 18
9.5- Landlord's Taxes 18
9.6 - Access 18
9.7 - Electric PowerERROR! BOOKMARK
NOT DEFINED.
10 - ASSIGNING AND SUB-LETTING 19
10.1 - Covenant Against Assignment 19
10.2 - Restrictions on Advertising
Transfer 19
10.3 - Factors to be Considered 19
10.4 - Terms of Consent 19
10.5 - Sale of Tenant's Business 19
10.6 - Right to Terminate 19
11 - INSURANCE 20
11.1 - Tenant's Insurance 20
11.2 - Contract Provisions 21
11.3 - Use of Premises (Insurance) 21
11.4 - Landlord's Insurance 22
12 - REZONING, ADDITIONS 22
12.1 - Rezoning 22
12.2 - Additions 22
13 - DAMAGE, DESTRUCTION OR EXPROPRIATION 23
13.1 - Abatement of Rent 23
13.2 - Damage in Last Year of Term 23
13.3 - Lack of Proceeds 23
13.4 - Procedure on Termination 23
13.5 - Expropriation 23
13.6 - Repair of Damage 24
13.7 - Consultant's Determination 24
14 - TENANT'S DEFAULT 24
14.1 - Remedies of Landlord 24
(c) - Termination 24
(d) - Recovery of Expenses 24
(e) - Right to Relet 25
14.2 - Cure Default 25
14.3 - Construction Liens 25
14.4 - Distress 25
14.5 - Interest 26
14.6 - Application of Receipts 26
14.7 - Protection of Landlord 26
14.8 - Abandonment of Goods 26
14.9 - Lien on Trade Fixtures 26
15 - BANKRUPTCY, ETC. 27
15.1 - Tenant's Insolvency 27
16 - NOTICES 27
16.1 - Delivery of Notices 27
17 - LANDLORD'S COSTS AND CONSENTS 27
17.1 - Legal Costs 27
17.2 - Other Expenses 28
18 - PRIOR INTERESTS 28
18.1 - Mortgagee's Priority 28
18.2 - Priority of Lease 28
18.3 - Acknowledgements or Statements 28
18.4 - Rights of Mortgagees 29
18.5 - Non-Disturbance Agreement 29
19 - MONTHLY TENANCY 29
19.1 - Monthly Tenancy 29
20 - GENERAL 29
20.1 - No Waiver of Default 29
20.2 - Remedies Cumulative 29
20.3 - Assignment by Landlord 29
20.4 - No Partnership 29
20.5 - No Option 29
20.6 - Registration of Notice 30
20.7 - Rules and Regulations 30
20.8 - No Contra Proferentum 30
21 - DELAYS 30
21.1 - Unavoidable Delay 30
21.2 - Failure of Landlord to Deliver
Possession 30
SCHEDULE"A" - LEGAL DESCRIPTION
SCHEDULE "B" - SKETCH OF BUILDING PREMISES
SCHEDULE "B-1"-SKETCH OF LAND AREA
SCHEDULE "C" - RULES AND REGULATIONS
SCHEDULE "D" - LANDLORD'S PERMITTED EXPANSION, ADDITION, BUILD AREA
SCHEDULE "D-1" TENANT'S PERMITTED DEMOLITION AREA