OFFICE LEASE
BASIC TERMS ( IF THERE IS ANY CONFLICT OR INCONSISTENCY BETWEEN THE BASIC TERM
AND THE TERMS OF THE LEASE, THE TERM OF THE LEASE SHALL GOVERN AND OVERRIDE THE
BASIC TERMS)
1. LANDLORD: Fercan Developments Inc.
2. ▇▇▇▇▇▇▇▇'S ADDRESS: ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
3. TENANT: Northern Ethanol ( Canada) Inc.
4. TENANT'S ADDRESS: ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
5. TENANT'S TRADE NAME: Northern Ethanol
6. USE: Office
7. LEASED PREMISES: All of the 3rd Floor, ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
8. GROSS LEASEABLE AREA: 7200 square feet
9. TERM: 5 years, commencing June1, 2006
(the "Commencement Date") and
ending on May 31st, 2011
10. BASE RENT: $25.00 PER Square foot
11. DEPOSIT: $15,000 plus GST
12. OPTION TO EXTEND: One extension period for five (5)
years at then prevailing market
rents but in no event less than the
Base Rent
2
THIS LEASE is dated as of April 11, 2006
BETWEEN:
FERCAN DEVELOPMENTS INC
(the "Landlord")
-and-
NORTHERN ETHANOL ( CANADA) INC.
(the "Tenant")
ARTICLE 1. - ARTICLE 1 - GRANT
Section 1.1 - The Leased Premises
The Landlord leases to the Tenant, and the Tenant leases from the
Landlord, the Leased Premises, to have and to hold for the Term, unless sooner
terminated.
Section 1.2 - Use of Common Elements
The Tenant has the non-exclusive and non-transferable (except in
accordance with Article 9) right to use the stairways and the entrance to the
Building ( the "Common Areas") in common with others entitled to do so, for the
purposes for which they are intended, subject to this Lease.
Section 1.3 - Quiet Enjoyment
If the Tenant performs its obligations under this Lease, it may hold and
use the Leased Premises without interference by the Landlord or any other Person
claiming by, through or under the Landlord, subject to the terms of this Lease.
Section 1.4 - First Option to Extend
Provided that:
(a) the Tenant pays the Rent as and when due and punctually observes and
performs its covenants, obligations and agreements under and in accordance with
the terms of this Lease;
(b) an Event of Default has not occurred; and
(c) the Tenant gives the Landlord not more than twelve (12) months, nor less
than six (6) months, written notice prior to the expiry of the initial Term of
its intention to extend the Term;
then, the Tenant will have the right to extend the Term upon the expiry of the
initial Term for a period of five (5) years (the "First Extended Term") upon the
same terms and conditions as are set out in this Lease, except that:
(i) there will be no further right to extend the Term:
Page 3
(ii) if the Landlord requires, the Tenant will promptly (1) execute a new
net lease for the First Extended Term on the Landlord's then current
standard form of net lease for the Leased Premises, in such form as is
agreed to by the parties and their respective solicitors, acting
reasonably, which form may include the then current definitions and
formulae for the calculation of Additional Rent, or (2) execute an
extension agreement prepared by the Landlord at the Tenant's expense giving
effect to the First Extended Term; and
(iii) the Base Rent shall be mutually agreed upon between the Landlord and
the Tenant based upon the then current fair market rental in respect of the
Leased Premises, provided that the Base Rent shall in no event be less than
the Base Rent payable by the Tenant for the last year of the initial Term,
and provided further that if the parties are unable to agree as to the
determination of the Base Rent payable by the Tenant during the First
Extended Term by no later than three (3) months prior to the expiry of the
initial Term, then, the Base Rent shall be determined by arbitration in
accordance with the Arbitrations Act of Ontario. If the Base Rent has not
been determined by the commencement of the First Extended Term, the Tenant
shall continue to pay Base Rent at 110% of the annual rate payment
immediately prior to the expiry of the initial Term until such Base Rent is
determined and within ten (10) days after the Base Rent for the First
Extended Term is determined, the Tenant shall pay to the Landlord any
amount retroactively owing from the commencement of the First Extended
Term. For the purposes of this Section 1.4 the term "fair market rental"
means the fair market basic minimum rental in respect of the Leased
Premises having regard to renewal rents then being obtained for premises
that are similarly sized, located and fixtured.
If the Tenant fails to exercise the foregoing option to extend the
Term in accordance with this Section 1.4 or if the other conditions set out in
this Section 1.4 are not satisfied, then, notwithstanding anything contained in
this Section 1.4 to the contrary, this option to extend shall be null and void.
In the event the Tenant exercises its option to extend the initial
Term in accordance with the provisions of this Section 1.4, then, the amount of
the Base Rent payable for the last month of the First Extended Term plus GST
shall be paid by the Tenant to the Landlord on or before the first day of the
First Extended Term as a Deposit.
ARTICLE 2 - CONSTRUCTION
Section 2.1 - Acceptance of the Leased Premises
The Tenant acknowledges and agrees that it is accepting possession of
the Leased Premises in an "as is" condition as of the commencement of the Term
and that the Landlord has no responsibility or liability for making any
renovations, alterations or improvements in or to the Leased Premises. All
renovations, alterations or improvements in or to the Leased Premises are the
sole responsibility of the Tenant and shall be undertaken or completed at the
Tenant's expense and strictly in accordance with the provisions of this Lease.
ARTICLE 3 - RENT
Section 3.1 - Base Rent - The Tenant shall pay as Base Rent the sum of
$25.00 per square foot of Gross Leaseable Area plus GST without deduction or
set-off, yearly and every year during the Term, as Base Rent, All Rent is
payable in Canadian dollars in advance, on the FIRST (1ST) day of each and every
month during the Term (commencing June 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.
Section 3.2 - Taxes
(a) The Tenant agrees to pay to the Landlord its Proportionate Share of any
escalation in the Realty Taxes over the base year 2006.
Page 4
Section 3.3 - Operating Costs
(a) The Tenant agrees to pay its Proportionate Share of any increase in the
Operating Costs over the base year of 2006.
Section 3.4 - Payment of Additional Rent
(a) The Landlord may estimate any amounts of which the Tenant is to pay its
Proportionate Share, or regular contribution, as herein provided, at the
commencement of each Lease year and the Tenant will pay to the Landlord its
Proportionate Share, or other contribution, of the estimated amounts in equal
monthly instalments in advance throughout the period for which the estimate is
made. The Landlord may periodically revise its estimates and notify the Tenant
of the revised estimates, and the Tenant's monthly payments will be adjusted
accordingly.
(b) Within hundred and twenty (120) days of the end of the Lease Year, or the
Term (or in the case of Realty Taxes, after receipt of the final bills) the
Landlord will make a final determination of the amounts of which the Tenant has
paid its Proportionate Share, or other contribution, and will provide to the
Tenant a statement of the actual amounts payable by the Tenant, showing in
reasonable detail the determination of the costs and the calculation of the
Tenant's payment. Any amounts owing by the Tenant to the Landlord will be paid
within ten (10) days after the date of delivery of the statement by the
Landlord. Any amounts owing by the Landlord to the Tenant will be credited to
the Tenant's account, without interest.
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 may 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.
Section 3.5 - Post-dated Cheques or Pre-Authorized Payment Plan
The Tenant will deliver to the Landlord, at the beginning of each Lease
Year, a series of monthly post-dated cheques for the Lease Year for the total of
the monthly payments of Base Rent and any Additional Rent that is payable
monthly under this Lease. Alternatively, at the Landlord's request, the Tenant
will participate in a pre-authorized payment plan whereby the Landlord will be
authorized to debit the Tenant's bank account each month or from time to time
during each Lease Year in an amount equal to the Rent payable on a monthly
basis. The Tenant shall sign the form of application attached as Schedule "E",
or similar thereto, to give effect to the foregoing within five (5) days after
presentation.
Section 3.6 - Overdue Rent
If the Tenant defaults in paying Rent, the unpaid Rent bears interest
at the Stipulated Rate from the due date to the date of payment.
Section 3.7 - Deposit
The Tenant shall pay a deposit of $15,000 plus GST to be applied
against Base Rent, Realty Taxes, Additional Rent and GST for the last month of
the Term.
Page 5
Section 3.8 - Rent Disputes
The Tenant may dispute any invoice, billing or statement in respect of
Rent only by giving written notice to the Landlord specifying the basis of the
dispute within sixty (60) days after delivery of the invoice, billing or
statement, as the case may be. The Tenant will, in any event, continue to pay
Rent in accordance with the Landlord's invoice, billing or statement until the
dispute is resolved. No dispute is valid unless the procedure set out in this
Section 3.8 is strictly complied with by the Tenant.
Section 3.9 - Remedies
(a) If any cheque given by the Tenant to the Landlord in
payment of Rent is refused payment by ▇▇▇▇▇▇'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.
(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 the Stipulated Rate..
ARTICLE 4. - USE OF THE LEASED PREMISES
Section 4.1 - Use and Trade Name
The Tenant will be able to use the Leased Premises as offices and for
no other purposes whatsoever; provided the Tenant complies with all applicable
laws and regulations including ,without limitation, all municipal by-laws and
regulations.
Section 4.2 - Conduct of Business
The Tenant agrees to comply with all applicable laws and regulations
including ,without limitation, municipal by-laws and regulations in the
operation of its business in the Leased Premises.
Section 4.3 - Prohibited Activities
No part of the Leased Premises will be used for the sale of second hand
goods or armed services surplus articles, insurance salvage stock, bankruptcy
stock or fire sale stock; the sale of firecrackers or fireworks; an auction,
bulk sale (other than a bulk sale made to an assignee or subtenant under a
permitted assignment or subletting), liquidation sale, "going out of business"
or bankruptcy sale; a sale or business conduct which, because of the
merchandising methods or quality of operation likely to be used, would in the
reasonable opinion of the Landlord tend to lower the character of the Building;
any practice of unethical or deceptive advertising or selling procedures; or any
activity which directly or indirectly involves the preparation, production,
generation, storage, removal or disposal of any Hazardous Substances.
Section 4.4 - Compliance with and Observance of Law
The Tenant will promptly comply with all governmental requirements from
time to time in effect relating to its ability to enter into and comply with
this Lease or which pertain to the Leased Premises, the Tenant's use of the
Leased Premises, the conduct of business in the Leased Premises, or the doing of
work in the Leased Premises. The Tenant is not required, however, to remedy work
done by the Landlord in contravention of any law.
Page 6
Section 4.5 - Signs
The Tenant will not display any Sign on the storefront of the Leased
Premises without the prior written approval of the Landlord, which will not be
unreasonably withheld. If the Landlord, acting reasonably, objects to a Sign in
the interior of the Leased Premises that is visible from the exterior of the
Leased Premises, the Tenant will immediately remove it. The Landlord on the
Tenant's behalf will erect and maintain at least one identification sign on the
storefront of the Leased Premises which will comply with the Landlord's sign
policy for the Development and be located as specified in writing by the
Landlord.
ARTICLE 5. - TENANT'S INSURANCE, RELEASE AND INDEMNITY
Section 5.1 - Tenant's Insurance
(a) Throughout the Term and any period when it is in possession of the Leased
Premises, the Tenant will maintain the following insurance:
(i) "all risks" property insurance (including without limitation,
water damage arising from any source, and flood and
earthquake) in an amount not less than the full replacement
cost, insuring all property of every description owned by the
Tenant, or for which the Tenant is liable, or installed by or
on behalf of the Tenant, and which is located in the
Development, including, without limitation, leasehold
improvements, the Tenant's fixtures, furniture, inventory,
equipment and all other personal property;
(ii) when applicable, broad form boiler and machinery insurance on
a blanket repair and replacement basis with limits for each
accident in an amount not less than the replacement cost of
all leasehold improvements and of all boilers, pressure
vessels, air-conditioning equipment and electrical equipment
in or serving the Leased Premises, owned or operated by the
Tenant or by others (except the Landlord) on behalf of the
Tenant;
(iii) business interruption insurance in an amount that will
reimburse the Tenant for direct or indirect loss of earnings
attributable to all perils insured against under Sections
5.1(a)(i) and (ii) and other perils commonly insured against
by prudent tenants, or attributable to prevention of access to
the Leased Premises or the Development as a result of those
perils;
(iv) public liability and property damage insurance including
personal injury liability, contractual liability, non-owned
automobile liability, contingent employers' liability, and
owners' and contractors' protective insurance coverage, with
respect to the Leased Premises and the Tenant's use of the
Development, on an occurrence basis, with coverage including
the activities and operations conducted: (A) by the Tenant and
any other Person on the Leased Premises; (B) by the Tenant and
any other Person performing work on behalf of the Tenant; and
(C) by the Tenant and those for whom the Tenant is in law
responsible in any other part of the Development. These
policies will be written on a comprehensive basis with
inclusive limits of at least five million dollars
($5,000,000.00) for each occurrence for bodily injury for any
one or more Persons or property damage (but the Landlord,
acting reasonably, or a Mortgagee, may require higher limits
from time to time);
(v) tenant's legal liability insurance for the full replacement
cost of the Leased Premises and all other property for which
the Tenant is legally liable, including loss of their use; and
(vii) any other form of insurance with whatever limits the Tenant,
the Landlord, acting reasonably, or a Mortgagee requires from
time to time, in form, in amounts and for risks against which
a prudent tenant under similar circumstances would insure.
(b) Each policy of insurance will name, as insured's, the Tenant and the
Released Persons, each as their respective interests may appear. The policies
specified under Sections 5.1(a) (i), (ii), (iii) and (vii) (if applicable) will
contain the standard mortgage clause required by each Mortgagee. The policies
specified under Section 5.1(a)(iv) will contain a severability of interests
clause and cross liability clauses. If there is a dispute as to the amount of
the full replacement cost, the decision of the Landlord's professional insurance
appraiser will be conclusive.
Page 7
(c) The policies specified under Sections 5.1(a) (i), (ii), (iii) and (vii) (if
applicable) will contain a waiver of any subrogation rights which the Tenant's
insurers may have against the Released Persons and those for whom any of them is
in law responsible, whether or not any loss or damage is caused or contributed
to by the negligence of any of them.
(d) All policies will: (i) be taken out with insurers acceptable to the
Landlord, in the Landlord's reasonable discretion; (ii) be in a form reasonably
satisfactory to the Landlord; (iii) be non-contributing with, and apply only as
primary and not excess to any other insurance available to any of the Released
Persons; (iv) not be invalidated as respects the interests of any of the
Released Persons by reason of any breach or violation of warranties,
representations, declarations or conditions contained in the policies; and (v)
contain an undertaking by the insurers to notify the Landlord and each Mortgagee
in writing not less than thirty (30) days before any material change,
cancellation or termination.
(e) Prior to taking possession of the Leased Premises and on every renewal date,
the Tenant will deliver certificates of insurance on the Landlord's standard
form, executed by the Tenant's insurers or their authorized representatives,
evidencing that the required insurance is in force, or, if requested by the
Landlord or a Mortgagee, the Tenant will promptly deliver other appropriate
evidence of the required insurance. No review or approval of any insurance
policy or certificate by the Landlord will in any way alter the Landlord's
rights under this Lease.
Section 5.2 - Increase in Insurance Premiums
The Tenant will comply promptly with the loss prevention
recommendations of the Landlord's insurers, pertaining to the Leased Premises or
the Development. If the occupancy of the Leased Premises, the conduct of
business in the Leased Premises, or anything done or omitted by the Tenant
results in an increase in premiums for any insurance carried by the Landlord,
the Tenant will pay the increase to the Landlord on demand. In determining
whether the Tenant is responsible for increased premiums and the amount for
which the Tenant is responsible, a schedule issued by the organization that
computes the insurance rate on the Development, showing the components of the
rate, will be conclusive evidence of the items that make up the rate.
Section 5.3 - Cancellation of Insurance
The Tenant will not allow or cause anything to occur that results in
the cancellation or threatened cancellation or a reduction of coverage under any
of the Landlord's insurance policies on the Development or any part of it, but
this will not prohibit the Tenant from carrying on the business required under
Section 4.1(a) in accordance with the terms of this Lease.
Section 5.4 - Release
Despite anything to the contrary, none of the Released Persons is
liable for: (i) any death or injury arising from any occurrence in, near or
relating to all or any part of the Development; or (ii) damage to or loss of (or
loss of use of) property of the Tenant or of others wherever located, however
caused, and even if the death, injury, damage or loss results from the
negligence of the Released Persons or those for whom they are legally
responsible, any failure in the supply of any services, systems or Utilities,
the existence of any Hazardous Substances anywhere or the exercise by the
Landlord of any of its rights under this Lease.
Without limiting the generality of the foregoing, the Released Persons
shall not be liable for any injury or damage to Persons or property resulting
from fire, explosion, falling plaster, falling ceiling tile, falling ceiling
fixtures and diffuser coverings, steam, gas, electricity, water, rain, flood,
snow or leaks from any part of the Development, including pipes, sprinklers,
appliances, plumbing works, roof, windows or the surface of any floor or ceiling
of the Development or from any Lands adjoining the Development. In addition, the
Released Persons shall not be liable for any damage to or destruction of any
negotiable instruments, cash or other valuable property belonging to the Tenant
or others and stored or otherwise contained in the Leased Premises. All property
of the Tenant kept or stored on the Leased Premises or the Development will be
so kept or stored at the risk of the Tenant only and the Tenant shall indemnify
and save harmless the Released Persons from any claims arising out of any
damages to such property including, without limitation, any subrogation claims
by the Tenant's insurers. The intent of this Section is that the Tenant (and all
other Persons having business with the Tenant) is to look solely to its insurers
to satisfy any claim which may arise on account of death, injury, loss or
damage, irrespective of its cause.
Page 8
Notwithstanding anything to the contrary, the foregoing release shall
not apply to any death or injury or loss of or damage to property referred to in
this Section 5.4 if any such death or injury or loss of or damage to property is
caused by or to the extent such death or injury or loss of or damage to property
is contributed to by the negligence of the Landlord, but only to the extent
that:
(1) (i) the Tenant is not required to have insurance coverage
for such death or injury or loss of or damage to
property pursuant to Section 5.1 of this Lease; and
(ii) The Tenant does not otherwise have insurance coverage
for such death or injury or loss of or damage to
property,
in either case without taking into account any deductible or
co-insurance provisions or other clauses of any insurance
policies; and
(2) the Landlord receives, or would have received, had it insured
in accordance with its obligations under this Lease, proceeds
of insurance for any such death or injury or any such loss of
or damage to property.
Section 5.5 - Indemnity
The Tenant will indemnify and protect the Released Persons from all
losses or claims in connection with loss of life, personal injury, damage to
property or anything else arising from a default of any of the Tenant's
obligations under this Lease, or from any occurrence in or relating to the
Leased Premises or the Development, or from the occupancy or use by the Tenant,
its employees, agents, contractors, invitees, licensees or those for whom the
Tenant is legally responsible of all or any part of the Leased Premises or the
Development, or occasioned wholly or in part by an act or omission of the
Tenant, its employees, agents, contractors, invitees, licensees, or those for
whom the Tenant is legally responsible or by anyone permitted to be on the
Leased Premises or the Development by the Tenant.
ARTICLE 6. - MAINTENANCE OF AND ALTERATIONS TO LEASED PREMISES
Section 6.1 - Maintenance of and Alterations to the Leased Premises
(a) Subject to Article 7, the Tenant will keep the Leased Premises and all
improvements, fixtures and operating equipment in the Leased Premises which are
not part of the Common Elements in a good state of repair.
(b) If required by the Landlord or any governmental agency the Tenant will
remove from the Leased Premises any Hazardous Substances which are located,
stored or incorporated in or on any part of the Leased Premises which the Tenant
or those for whom the Tenant is in law responsible brings onto or generates from
the Leased Premises or which the Tenant or those for whom the Tenant is in law
responsible suffers or permits to be brought onto or generated from the Leased
Premises at any time and for whatever reason (but this shall not imply any
authority to bring onto or generate from the Leased Premises, or suffer or
permit the same, any Hazardous Substances which are otherwise prohibited by this
Lease). The foregoing obligation to remove Hazardous Substances will survive the
expiration of the Term or earlier termination of this Lease.
(c) The Tenant will not make any Alterations to the Leased Premises without the
Landlord's prior written approval, which approval shall be in the Landlord's
sole and absolute discretion and provided (i) the Tenant has obtained all
requisite governmental approvals.
Page 9
(d) All Alterations will be performed: (i) by competent workers; (ii) in a good
and skilful manner. Upon completion of any such Alterations, the Tenant shall
promptly deliver to the Landlord a complete set of updated sketches of the
Leased Premises showing any changes to the leased premises.
(e) The Landlord may require that any maintenance, repairs or replacements of or
Alterations, to the Leased Premises, or any part thereof, be performed by the
Landlord at the Tenant's cost if they affect: (i) the Common Elements; (ii) any
part of the Development outside the Leased Premises; (iii) any of the structural
portions of the Leased Premises including, without limitation, the foundations,
roof, exterior wall assemblies including weather walls, exterior or interior
structural components and bearing walls, sub-floors and finished ceilings; or
(iv) any of the base building systems, services and structures, including,
without limitation, the electrical, plumbing, mechanical, heating, ventilating
and air conditioning systems for the Leased Premises. The Tenant will pay to the
Landlord, on demand, the Landlord's cost of such work, including architectural
and engineering consultants' fees, plus an Administration Fee.
Section 6.2 - Repair Where the Tenant is at Fault
If all or any part of the Development requires repair, replacement or
alteration: (a) because of anything done by the Tenant or its officers,
directors, agents, employees, contractors, invitees or licensees; or (b) due to
the requirements of governmental authorities relating to the business conducted
in the Leased Premises; then the Tenant will pay to the Landlord, on demand, the
Landlord's cost of the repairs, replacements or alterations, plus an
Administration Fee.
Section 6.3 - Removal of Alterations and Restoration of Leased Premises
(a) All Alterations which are not the Tenant's trade fixtures are leasehold
improvements and regardless who affixed or installed them, are the property of
the Landlord on affixation or installation, without compensation to the Tenant.
The Tenant will not remove any leasehold improvements from the Leased Premises
at any time (i) Landlord's Work, and (ii) improvements made to the Leased
Premises which were not made at the Tenant's request or by or on behalf of the
Tenant) that the Landlord requires it to remove.
(b) The Tenant will also remove its trade fixtures at the expiry or earlier
termination of the Lease. The Tenant will, at the Tenant's expense, repair any
damage caused to any part of the Development by such removal. If the Tenant does
not remove its trade fixtures at the expiry or earlier termination of the Term,
they will at the Landlord's option, become the property of the Landlord. At the
expiry or termination of this Lease, the Tenant will: (a) leave the Leased
Premises in a clean and broom swept condition; (b) deliver all keys for the
Leased Premises to the Landlord at the place then fixed for the payment of Rent;
and (c) give to the Landlord the combinations of any locks, safes, and vaults in
the Leased Premises. The following are considered as leasehold improvements and
not trade fixtures: (i) heating, ventilating and air-conditioning Facilities in
or serving the Leased Premises; (ii) affixed floor and wall coverings and fixed
millwork; (iii) light fixtures, including light bulbs and tubes; (iv) ceiling
tiles; (v) electrical or plumbing Facilities in or serving the Leased Premises;
(vi) the storefront or doors; (vii) internal stairways, escalators or elevators;
and (viii) anything else that would not normally be considered a trade fixture.
Section 6.4 - Secured Claims
The Tenant will ensure that no Secured Claim is registered or filed
against: (a) the Development or any part of it; (b) the Landlord's or any
Owner's or Mortgagee's interest in the Development or any part of it; or (c) the
Tenant's interest in the Leased Premises or any of the leasehold improvements in
the Leased Premises; by any Person claiming by, through, under, or against the
Tenant or its contractors or subcontractors. If a Secured Claim is registered or
filed and the Tenant fails to promptly discharge it after receipt of notice from
the Landlord, the Landlord may discharge the Secured Claim or notice of it by
paying the amount claimed to be due into court (together with whatever
additional amounts are required to be paid into court to obtain its removal)or
directly to the holder of the Secured Claim and the Tenant will pay to the
Landlord on demand all costs (including legal fees) incurred by the Landlord in
connection with the Secured Claim, plus an Administration Fee.
Page 10
Section 6.5 - Overloading
The Tenant will not: (a) install equipment that overloads the capacity
of any utility, electrical or mechanical Facilities in or serving the Leased
Premises; (b) bring into the Leased Premises any utility, electrical or
mechanical Facilities or service not approved by the Landlord in advance; or (c)
bring anything upon the Leased Premises that might damage them or overload the
floors.
Section 6.6 - HVAC Operation and Energy Conservation
(a) The Tenant will keep those parts of the heating, ventilating and
air-conditioning facilities within the Leased Premises (including the
distribution system for the Leased Premises) that are not part of the HVAC
System and those outside of the Leased Premises (if any) for the exclusive use
of the Leased Premises, (the "Tenant's System"), in good repair and operating
order, at its own expense. The Tenant will maintain and operate the Tenant's
System to the satisfaction of the Landlord, at its own expense.
(b) If the Tenant should disagree with the Landlord's distribution of utility
charges, than the Tenant's will install at its own expense, at a location
designated by the Landlord, a separate meter for the Tenant's System and pay
Utilities in accordance with Section 3.3(b).
(c) On the Tenants behalf, the Landlord will maintain and repair the HVAC
system. The costs for maintenance for any single repairs per unit, less than
$2,000.00 will be invoiced to the Tenant, for a repair to a single unit in
excess of $2,000.00 the Tenant will be invoiced annually for 20% of the repair
bill for each year remaining in the Tenancy up to a maximum of five (5) years.
(d) The Tenant will comply with reasonable requests of the Landlord for
conservation of energy.
ARTICLE 7. - LANDLORD'S COVENANTS
Section 7.1 - Landlord's Insurance
Throughout the Term the Landlord will maintain: (a) all risks insurance
on the Development and the machinery, boilers and equipment contained in it and
owned by the Landlord (excluding the foundations and excavations and any
property that the Tenant or other tenants are required to insure); (b) public
liability and property damage insurance with respect to the Landlord's
operations in the Development; and (c) whatever other forms of insurance the
Landlord or the Mortgagee reasonably consider advisable. The Landlord's
insurance will be in those reasonable amounts and with those reasonable
deductibles that a prudent owner of a similar Development would maintain, having
regard to size, age and location. This Section does not relieve the Tenant from
liability arising from or contributed to by its negligence or misconduct. The
Tenant has no insurable interest and no right to receive proceeds or other
benefits under any of the Landlord's insurance policies.
Section 7.2 - Maintenance and Repairs by the Landlord
Subject to Article 8, the Landlord will maintain and repair the Common
Elements as would a prudent owner of a similar Development, having regard to
size, age and location, subject to the following exceptions: (a) any occurrence
not covered by insurance required to be maintained by the Landlord under this
Lease, or for which the cost of repair exceeds the insurance proceeds actually
received by the Landlord (not taking into account deductibles); and (b) damage
or injury caused or to the extent contributed to by anything done or omitted to
be done by the Tenant or those for whom it is legally responsible.
Section 7.3 - Control of the Development by the Landlord
(a) The Landlord will control the management and operation of the Development.
In doing so, the Landlord will have, among its other rights, the right to:
(i) temporarily close parts of the Common Elements to prevent
their dedication or the accrual to anyone of rights in them;
grant, modify and terminate easements and other agreements
pertaining to the use and operation of the Development or any
part of it; and temporarily obstruct or close off parts of the
Development for maintenance, repair or construction;
Page 11
(ii) employ personnel, including supervisory personnel and
managers, for the operation, maintenance and control of the
Development, which may be managed by the Landlord or by anyone
else designated by the Landlord;
(iii) regulate all aspects of loading and unloading, delivery and
shipping of fixtures, equipment and merchandise, and all
aspects of garbage collection and disposal;
(iv) construct improvements in the Development.
(b) The Landlord shall be entitled at any time upon sixty (60) days' prior
written notice to the Tenant to make alterations, additions or reductions to the
Common Elements provided the Landlord effects such alterations, additions or
reductions at its expense.
(c) Despite anything to the contrary in this Lease, the Landlord is not liable
for and the Tenant will not be entitled to any compensation or Rent reduction as
a result of any change in the Common Elements caused by the Landlord's exercise
of its rights under this Lease or any repairs, alterations, improvements or
additions being made to the Common Elements or the Leased Premises.
Section 7.4 - Landlord's Right of Entry
(a) It is not a re-entry or a breach of quiet enjoyment if the Landlord enters
the Leased Premises at reasonable times during business hours after reasonable
notice (but if the Landlord determines there is an emergency, no notice is
required): (i) to examine them including an examination to ensure that there are
no Hazardous Substances present and that there are appropriate safeguards in
place to avoid the existence of any Hazardous Substances; (ii) to make permitted
or required repairs, improvements or additions to the Leased Premises (including
the pipes, conduits, wiring, ducts, columns and other installations in the
Leased Premises) or the Development or adjacent property; or (iii) to excavate
land adjacent to or subjacent to the Leased Premises; in each case (to the
extent reasonably possible in the circumstances) without unreasonably
interfering with the Tenant's business operations in the Leased Premises, and
the Landlord may take material into and on the Leased Premises for those
purposes, but shall do so in such a manner as to minimize interference with the
Tenant's business operations . Rent will not ▇▇▇▇▇ or be reduced while the
repairs, improvements or additions are being made. The Landlord will take
reasonable steps to minimize any interruption of business resulting from any
entry.
(b) The Landlord may enter the Leased Premises at reasonable times to show them
to prospective purchasers, tenants or mortgagees, without unreasonably
interfering with the Tenant's business operations. During the six (6) months
before the Term expires, the Landlord may display reasonably sized and located
"For Rent" or "For Sale" notices on the outside of the Leased Premises.
Section 7.5 - Redevelopment
If at any time during the Term or any renewal the Landlord desires to
renovate, alter, demolish, redevelop and/or sell all or any part of the
Development (the "Redevelopment"), the Tenant agrees that if the Landlord
determines in its sole discretion that it requires vacant possession of the
Leased Premises in connection with the Redevelopment, then the Landlord shall be
entitled, at its option, to terminate this Lease upon written notice to the
Tenant without obligation or liability to the Tenant. Such termination notice
shall be given at least six (6) months prior to the date upon which the
termination is to take effect (the "Effective Date of Termination"). The Tenant
shall not be obligated to pay Minimum Rent, Percentage Rent or Additional Rent
for the six-month period prior to the Effective Date of Termination. The Tenant
shall deliver up vacant possession of the Leased Premises on the Effective Date
of Termination in accordance with its obligations under this Lease.
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ARTICLE 8. - DAMAGE AND DESTRUCTION AND EXPROPRIATION
Section 8.1 - Damage to the Leased Premises
Subject to Section 7.2, if the Leased Premises are damaged or destroyed
as a result of a peril insured or required to be insured against by the
Landlord, the Landlord will repair the Leased Premises promptly to the extent of
the Landlord's Work, at the Landlord's expense. If part or all of the Leased
Premises is, in the opinion of the Architect, not usable for the purposes
contemplated by this Lease because of the damage or destruction, Minimum Rent,
Percentage Rent, and, to the extent that the Landlord specifically receives
insurance proceeds for it, Additional Rent will ▇▇▇▇▇ during the abatement
period on a pro-rated basis for the Gross Leaseable Area of the unusable part of
the Leased Premises. The abatement period is the period from the date of the
damage or destruction until the earlier of: (a) the date when all of the Leased
Premises are usable again in the opinion of the Architect; and (b) thirty (30)
days after the Landlord's notice mentioned in the next sentence. When the
Landlord notifies the Tenant that it has completed enough of the Landlord's Work
to enable the Tenant to start the Tenant's Work, the Tenant will complete the
Tenant's Work at its expense and reopen the whole of the Leased Premises for
business as soon as possible, but in any case within thirty (30) days after the
Landlord's notice is given.
Section 8.2 - Damage to or Expropriation of the Development
(a) Despite anything to the contrary in this Lease, if in the opinion of the
Architect more than thirty five percent (35%) of the Gross Leaseable Area of the
Development is damaged, destroyed or expropriated, whether or not the Leased
Premises are damaged, destroyed or expropriated, then the Landlord may, upon
thirty (30) days' notice to the Tenant given within ninety (90) days after the
damage, destruction or expropriation, terminate this Lease, and all Rent will
▇▇▇▇▇ as of the effective date of the termination. A sale, conveyance, or other
disposition to a governmental authority made in contemplation of an
expropriation or a threatened expropriation will be considered an expropriation
for the purpose of this Section.
(b) Despite anything to the contrary in this Lease, if in the opinion of the
Architect more than fifty percent (50%) of the Gross Leaseable Area of the
Leased Premises is damaged, destroyed or expropriated, then the Landlord or the
Tenant may, upon thirty (30) days' notice to the other given within ninety (90)
days after the damage, destruction or expropriation, terminate this Lease, and
all Rent will ▇▇▇▇▇ as of the effective date of the termination.
(b) If the Development is damaged, destroyed or expropriated to the extent
described in Section 8.2(a) and the Landlord does not terminate this Lease, the
Landlord will promptly rebuild or repair the Development to the extent of its
obligations under its leases for Leaseable Premises but the Landlord may use
plans and specifications and working drawings that are different in content from
those used in the original construction of the Development or any part of it and
the rebuilt or repaired Development may be different in configuration or design
from the Development before the damage, destruction or expropriation.
(c) The Landlord and the Tenant will co-operate with each other if there is an
expropriation of all or part of the Leased Premises or the Development, so that
each may receive the maximum award to which it is legally entitled.
ARTICLE 9. - TRANSFERS
Section 9.1 - Consent Required
(a) No Transfer will take place without the consent of the Landlord, which
consent will not be unreasonably withheld if there is no Event of Default,
except that despite anything to the contrary in this Lease or any applicable
law:
(i) the Landlord may unreasonably withhold its consent to a
Transfer by exercising its termination right set out in
Section 9.1(b);
(ii) the Landlord may refuse to consent to a Transfer if:
Page 13
(A) the Transferee 1) does not have a history of
successful business operation in the business to be
conducted in the Leased Premises, 2) does not have a
good credit rating and a substantial net worth, or 3)
is not able to finance the Transfer and its operations
in the Leased Premises in a manner that will enable
the Transferee to carry on business successfully in
the Leased Premises throughout the Term without a
material risk of defaulting under this Lease;
(B) the Transferee pays or gives to the Transferor money
or other value that is reasonably attributable to the
desirability of the location of the Leased Premises or
to Alterations wholly or partly paid for or owned by
the Landlord;
(C) the Transfer is a mortgage, charge, debenture
(floating or otherwise) of this Lease or all or any
part of the Leased Premises (including any leasehold
improvements); or
(D) the Landlord does not receive sufficient information
from the Tenant or the Transferee to enable it to make
a reasonable determination of the matters set out
above.
(E) provided further that should any Transfer Assignment
provide for rent greater than the rent set out herein,
such increase in rent shall be payable directly to the
Landlord.
This Section does not apply to a Transfer that occurs on the death of
the Transferor, or a Transfer described in paragraph (c) of the definition of
Transfer, where the Tenant occupies all of the Leased Premises and is either (i)
a Public Corporation, or (ii) a subsidiary body corporate (as currently defined
under the Canada Business Corporations Act) of a Public Corporation and the
shares of the Public Corporation (and not the Tenant or any of its affiliates)
are transferred or issued; or (iii) the Transfer is an issue of the Tenant's
shares to the public whereby the Tenant becomes a Public Corporation. The Tenant
will nevertheless notify the Landlord if any exempt Transfers take place.
However, if after any exempt Transfer occurs, the Tenant fails to satisfy the
Landlord (acting reasonably) that there will be continuity or improvement of the
Tenant's business practices and policies that existed before the Transfer, the
Landlord may, at any time until sixty (60) days after the Transfer takes place,
notify the Tenant of its dissatisfaction, and a default of this Section 9.1 will
be considered to have occurred as of the date of the ▇▇▇▇▇▇▇▇'s notice.
Subparagraph (a)(i) of this Section 9.1 shall not apply in the case of
a sale by the Tenant of its business conducted in the Leased Premises, whether
such sale is (i) by a transfer, sale, or other disposition of all of the shares
of the Tenant, or (ii) by a transfer, sale, or other disposition of all or
substantially all of the assets of the Tenant.
(b) If the Tenant intends to effect a Transfer, then the Tenant will give prior
written notice to the Landlord of such intent, specifying the proposed
Transferee and providing additional information including, without limitation, a
copy of a bona fide written offer with respect to the proposed Transfer which
the Tenant is prepared to accept, subject to compliance with the provisions of
this Lease and which must disclose any and all monetary payments or other
consideration made or to be made by the proposed Transferee as consideration for
such Transfer, and any other information concerning the financial or business
status of the Transferee that the Landlord requires. The Landlord will, within
thirty (30) days after having received notice and all necessary information,
notify the Tenant in writing either that (i) it consents or does not consent to
the Transfer, or (ii) it elects to cancel this Lease in preference to giving
consent. If the request for consent is to a sublease or parting with possession
of a portion (but not all) of the Leased Premises, the Landlord's election to
cancel this Lease shall apply only with respect to such portion and in such
event the Tenant shall, at its sole expense, arrange for the partitioning of the
Leased Premises so as to separate the portion being Transferred from the
remainder of the Leased Premises. If the Landlord elects to cancel this Lease,
the Tenant will notify the Landlord in writing within seven (7) days thereafter
of the Tenant's intention either to refrain from the Transfer or to accept the
cancellation of this Lease. If the Tenant fails to deliver its notice within the
seven (7) day period, this Lease will be terminated upon the date stipulated by
the Landlord in its notice of cancellation, to be not less than (30) days and
not more than one hundred and twenty (120) days after delivery of the Landlord's
notice of cancellation. If the Tenant advises the Landlord within the seven (7)
day period that it intends to refrain from the Transfer, then the Landlord's
election to cancel this Lease will be void. Notwithstanding anything else
contained in this Section 9.1(b), the foregoing right to cancel as set out in
Subsection 9.1(b)(ii) shall not apply to Transfers of the basement level of the
Leased Premises.
Page 14
Section 9.2 - Transfer Conditions
The following conditions apply to Transfers and to consents given by
the Landlord:
(i) the Landlord's consent is not a waiver of the requirement for
consent to subsequent Transfers;
(ii) once the Landlord's consent is given, the Transfer must take
place within sixty (60) days or the consent will expire and
the Transfer may not take place unless the Tenant again
complies with Article 8;
(iii) the Transferor will remain jointly and severally liable for
the Tenant's obligations and indemnify the Landlord against
the Transferee's failure to perform the Tenant's obligations
after the Transfer, and execute a separate agreement to that
effect on the Landlord's standard form;
(iv) the Transferee will execute an agreement directly with the
Landlord agreeing to be bound by this Lease as Tenant;
(v) the Landlord may apply amounts collected from the Transferee
to any unpaid Rent;
(vi) unless the Transfer is a sublease, the Transferor will have no
rights to enforce the Landlord's obligations under the Lease
or to use or occupy the Leased Premises after the Transfer;
(vii) the Transferor will not be entitled to obtain a Transfer back
without obtaining the Landlord's consent under Article 8 in
the same way as for any other Transfer;
(viii) any documents relating to a Transfer or the Landlord's consent
will be prepared by the Landlord and the Tenant will pay the
Landlord's reasonable legal and administrative costs on
account thereof regardless of whether or not the Transfer
occurs;
(ix) any Transfer where the Tenant receives a rent or other
consideration in lieu of rent (in any form) from the
Transferee which is greater than the Rent payable under this
Lease, the Tenant will pay the excess to the Landlord (in
addition to the Rent payable under this Lease);
Page 15
(x) if this Lease is repudiated, disaffirmed, disclaimed,
surrendered (except with the consent of the Landlord) or
terminated by a Transferee, by any trustee in bankruptcy of a
Transferee, or by a court representative, the original Tenant
named in this Lease or any Transferee (except the bankrupt or
insolvent Transferee) will be considered, upon notice, to have
entered into a lease (the "Remainder Period Lease") with the
Landlord, containing the same terms and conditions as this
Lease (the commencement date of the Remainder Period Lease
will be the date of the repudiation, disaffirmation,
disclaimer, surrender or termination and the expiration date
of the Remainder Period Lease will be the date on which this
Lease would have expired had the repudiation, disaffirmation,
disclaimer, surrender or termination not occurred);
Section 9.3 - Additional Terms Respecting Transfers
Acceptance by the Landlord of Rent or other payments by a Transferee is
not, (i) a waiver of the requirement for the Landlord to consent to the
Transfer, (ii) the acceptance of the Transferee as Tenant, or (iii) a release of
the Tenant from its obligations under this Lease.
Section 9.4 - Transfer Clause
From time to time, the Tenant may have associates or other health care
practitioners or providers who share in the practice of the Tenant or to whose
clients the Tenant provides services or whom share clients with this Tenant and
make contribution to the expenses of the Tenant including sharing the cost of
rent. This shall not constitute a sub-lease or assignment but shall be permitted
by the Landlord without approval or consent being required in such cases.
ARTICLE 10. - LANDLORD'S SALE OR FINANCING OF DEVELOPMENT
Section 10.1 - Sale by the Landlord
If the Landlord transfers or disposes of all or any part of the
Development or the Landlord's interest under this Lease, then to the extent that
the transferee or disposee agrees with the Landlord to assume its obligations
under this Lease, the Landlord will be released from them, except for existing
defaults as of the date of the transfer or disposition.
Section 10.2 - Subordination and Attornment
This Lease is subordinate to every existing and future mortgage,
charge, trust deed, financing, refinancing or collateral financing against the
Leased Premises or the Development and to the instruments of, as well as the
charge or lien resulting from any of them and any renewals or extensions of or
advances under them (collectively, "encumbrances"), provided that 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. The Tenant will, on request, attorn
to and recognize as landlord the holder of any such encumbrance, the Owner, or
any transferee or disposee of the Development or of an ownership or equity
interest in the Development. The Tenant will, within fifteen (15) days after
request, sign and deliver any reasonably requested document confirming the
subordination or the attornment. The form and content of the document will be
determined by the party requesting it.
Page 16
Section 10.3 - Status Statement
Within seven (7) days after request, the Tenant will sign and deliver
to the Landlord or anyone with or proposing to take an interest in all or part
of the Development, a status statement or certificate, stating that this Lease
is in full force and effect, any modifications to this Lease, the commencement
and expiry dates of this Lease, the date to which Rent has been paid, the amount
of any prepaid Rent or deposits held by the Landlord, whether there is any
existing default on the part of the Landlord and the particulars thereof, the
dates to which the Rent, by instalment or otherwise and other sums payable under
the Lease have been paid, 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 and any other
information reasonably required by the party requesting it.
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;
Section 10.4 - Financial Information
The Tenant will, upon request, provide the Landlord with such
information as to the Tenant's financial standing and corporate reorganization
as the Landlord or the Mortgagee requires.
Section 10.5 - 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.
ARTICLE 11. - DEFAULT
Section 11.1 - Right to Re-enter
(a) If an Event of Default occurs, (i) the full amount of the current month's
and the next three (3) months' instalments of Rent (calculated according to
Section 10.1(b)) will immediately be due and payable, and (ii) the Landlord may
re-enter and re-possess the Leased Premises. If the Landlord re-enters, at the
Landlord's option, this Lease and all of the Tenant's rights under it will
terminate without any liability to the Landlord for loss or damage, and without
prejudice to the Landlord's right to recover any arrears of Rent and damages for
any previous breach by the Tenant of this Lease. On such a termination, the
Tenant will promptly (and in any case within ten (10) days after written notice
requiring it to do so) remove all of its property from the Leased Premises, or
the Landlord may at any time remove all or part of the property from the Leased
Premises and store it in a public warehouse or elsewhere at the cost of the
Tenant. Despite anything to the contrary, in such event the Landlord will not be
responsible for loss or damage to any of the Tenant's property regardless of how
the loss or damage is caused, even if by negligence. If the Tenant fails to
remove its property as required, or if it fails to pay the Landlord's costs of
removal and storage within ten (10) days after written notice specifying those
costs, the Tenant will be considered to have abandoned its property and the
Landlord will be entitled to retain or to sell or dispose of it for the
Landlord's own benefit. Despite any termination for an Event of Default, the
Landlord may sue the Tenant for damages, including loss of future Rent as a
result of this Lease being prematurely terminated (for what would have been the
remainder of the Term had the Lease not been terminated) and the cost of
recovering the Leased Premises. If any legal proceedings are instituted because
of an Event of Default, the Tenant will pay the Landlord's expenses, including
legal fees on a solicitor and client basis.
Page 17
(b) If the Landlord terminates this Lease for an Event of Default, then for the
purpose of calculating future Rent, the annual Rent will be considered to be
equal to: the aggregate of the annual Minimum Rent, Percentage Rent and
Additional Rent payable under this Lease over the balance of the Term, assuming
a five percent (5%) annual increase in Percentage Rent and Additional Rent year
over year for the remainder of the Term.
Section 11.2 - Re-entry Without Termination
No re-entry or taking possession of the Leased Premises by the Landlord
will be considered an election to terminate this Lease unless a written notice
of such intention is given to the Tenant. If the Landlord re-enters or takes
possession of the Leased Premises, it may either terminate this Lease or make
any necessary alterations and repairs in order to relet all or any part of the
Leased Premises, for a term (which may extend beyond the Term), at a rental rate
and on any other terms the Landlord in its sole discretion considers advisable.
All Rent received by the Landlord from each reletting will be applied first to
any indebtedness other than Rent due; second, to any costs of reletting
including brokerage and legal fees (on a solicitor and client basis) and the
costs of the required alterations and repairs; third, to any arrears of Rent;
and any residue will be held by the Landlord and applied against future Rent as
it becomes due. If rent received from the reletting for any month is less than
the Rent to have been paid by the Tenant for that month, the Tenant will pay the
deficiency monthly in advance on the first day of each month. If the Landlord
relets without terminating, it may nevertheless subsequently terminate the Lease
for the previous Event of Default.
Section 11.3 - Distress Waivers
Despite the Commercial Tenancies Act (Ontario) or any other legislation
or law: (a) none of the inventory, furniture, equipment or other property at any
time owned by the Tenant is exempt from distress; and (b) no lack of compliance
with any requirement concerning the day of the week, time of day or night,
method of entry, giving of notice, appraising of goods, or anything else, will
render any distress unlawful where the Tenant owes arrears of Rent at the time
of the distress.
Section 11.4 - Fraudulent Removal of Goods
Removal by the Tenant of its goods outside the ordinary course of its
business either during or after regular business hours of the Development shall
be deemed to be a fraudulent or clandestine act thereby enabling the Landlord to
avail itself of all remedies at law including, but not limited to, the
Landlord's rights to follow the Tenant's goods and to recover more than the
value of the goods so removed.
Section 11.5 - Landlord May Cure the Tenant's Default
If the Tenant defaults in the payment of money that it is required
under this Lease to pay to a third party, the Landlord may, after five (5) days'
notice to the Tenant, pay all or part of the amount payable. If the Tenant
otherwise defaults under this Lease the Landlord may give the Tenant at least
ten (10) days' prior notice (except that forty-eight (48) hours' notice will
suffice for a default under Section 4.1, and no notice of any default will be
required in an emergency) and if the Tenant does not, within such period,
commence diligently and thereafter proceed diligently to cure the default, the
Landlord may perform or cause to be performed all or part of what the Tenant
failed to perform and may enter the Leased Premises and do those things that the
Landlord considers necessary for that purpose. The Tenant will pay to the
Landlord on demand, the Landlord's expenses incurred under this Section 11.5,
plus an Administration Fee.
Section 11.6 - Application of Money
The Landlord may apply amounts received from or due to the Tenant
against amounts due and payable under this Lease, even if otherwise requested by
the Tenant, unless the Tenant can satisfactorily demonstrate to the Landlord,
acting reasonably, that an amount is in fact not due and payable.
Section 11.7 - Remedies Generally
The remedies under this Lease are cumulative and may be exercised
independently or in combination with others. No remedy is exclusive or dependent
on any other remedy. The specifying or use of a remedy under this Lease does not
limit rights to use other remedies available at law generally.
Page 18
Section 11.8 - Expenses
If legal proceedings are brought for recovery of possession of the
Leased Premises, for the recovery of Rent or GST, or because of an Event of
Default, the Tenant will pay to the Landlord its expenses, including its legal
fees (on a solicitor and client basis).
ARTICLE 12. - INTENT AND INTERPRETATION
Section 12.1 - Gross Lease
(a) This Lease is a gross lease subject to escalations for Realty Taxes and
Operating Costs.
(b) The Tenant will pay GST on Rent and any other GST imposed by the applicable
legislation on the Tenant in respect of this Lease, in the manner and at the
times directed by the applicable legislation. This GST is not consideration for
the rental of space or the provision of any service by the Landlord under this
Lease, but will be considered to be Rent and the Landlord will have all of the
same remedies and rights of recovery for it as it has for non-payment of Rent.
If a deposit is forfeited to the Landlord, or an amount becomes payable to the
Landlord due to a default or as consideration for a modification of this Lease,
and the applicable legislation deems a part of the deposit or amount to include
GST, the deposit or amount will be increased and the increase paid by the Tenant
so that the Landlord will receive the full amount of the forfeited deposit or
other amount payable without encroachment by any deemed GST portion.
Section 12.2 - Landlord and Representatives to Act Reasonably and in Good Faith
In making a determination, designation, calculation, estimate,
conversion, or allocation or in granting any consent or approval under this
Lease, the Landlord will act reasonably and in good faith, subject to the
specific provisions of this Lease. Each accountant, architect, engineer,
surveyor or other professional Person employed or retained by the Landlord will
act in accordance with the applicable principles and standards of the Person's
profession.
Section 12.3 - Entire Agreement and General Interpretation
This Lease includes any Schedules and riders attached to it. There are
no covenants, promises, agreements, conditions or understandings, either oral or
written, between the parties concerning this Lease, the Leased Premises, the
Development or any other related matter, except those that are set out in this
Lease. No alteration, amendment, change or addition to this Lease is binding
upon the Landlord or the Tenant unless it is in writing and signed by the Tenant
and the Landlord. Each obligation under this Lease is a covenant. The Basic
Terms, captions, section numbers, article numbers and Table of Contents do not
define, limit, construe or describe the scope or intent of the sections or
articles. The use of the neuter singular pronoun to refer to the Landlord or the
Tenant is a proper reference even though the Landlord or the Tenant is an
individual, a partnership, a corporation or a group of two or more individuals,
partnerships or corporations. The grammatical changes needed to make the
provisions of this Lease apply in the plural sense when there is more than one
Landlord or Tenant and to corporations, associations, partnerships or
individuals, males or females, are implied. Wherever the word "including" is
used it is intended to mean "including but not limited to", and "includes" has a
corresponding meaning. This Lease will be governed by the laws of Canada and the
Province. Time is of the essence of this Lease.
Section 12.4 - Severability
If a part of this Lease or the application of it is unenforceable or
illegal to any extent, the part: (a) is independent of and severable from the
remainder of this Lease, and its unenforceability or illegality does not affect
the remainder of this Lease; and (b) continues to be enforceable to the fullest
extent permitted by law, except to the extent it is unenforceable or illegal. No
part of this Lease will be enforced against a Person, if, or to the extent that
by doing so, the Person is made to breach a law, rule, regulation or enactment.
Page 19
ARTICLE 13. - MISCELLANEOUS
Section 13.1 - Overholding - No Tacit Renewal
If the Tenant remains in possession of the Leased Premises after the
Term, there is no tacit renewal of this Lease despite anything to the contrary,
and the Tenant will occupy the Leased Premises as a month to month tenant. The
monthly Minimum Rent, payable in advance on the first day of each month, will be
equal to the total of: (a) the monthly amount of Minimum Rent for the last month
of the Term; (b) one-twelfth (1/12th) of the amount of Percentage Rent payable
by the Tenant in the last full twelve (12) month Lease Year; and (b) one-twelfth
(1/12th) of the amount of Additional Rent payable by the Tenant in the last full
twelve (12) month Lease Year. All of the other provisions of this Lease will
apply as far as they can to a monthly tenancy, with any necessary modifications
being assumed.
Section 13.2 - Successors
This Lease applies to the successors and assigns of the Landlord and,
if Article 9 is complied with, the heirs, executors, administrators and
permitted successors and permitted assigns of the Tenant. If there is more than
one Tenant, they are individually and collectively liable under this Lease.
Section 13.3 - Waiver
The waiver by the Landlord or the Tenant of a default under this Lease
is not a waiver of any subsequent default. The Landlord's acceptance of Rent
after a default is not a waiver of any preceding default under this Lease even
if the Landlord knows of the preceding default at the time of acceptance of the
Rent. No obligation or term of this Lease will be considered to have been waived
by the Landlord or the Tenant unless the waiver is in writing. The Tenant waives
any statutory or other rights in respect of abatement, set-off or compensation
in its favour that may now or in the future exist in connection with Rent.
Section 13.4 - Force Majeure
Despite anything to the contrary, if the Landlord or the Tenant is, in
good faith, prevented from doing anything required by this Lease because of
Force Majeure, the doing of the thing is excused for the period of the Force
Majeure and the party prevented will do what was prevented within the required
period after the Force Majeure, but this does not excuse either party from
payment of amounts they are required to pay at the times specified in this
Lease.
Section 13.5 - Notices
Notices, demands, consents or requests under this Lease will be in
writing and will be delivered in person or sent by registered mail postage
prepaid and addressed: (a) if to the Landlord, at the address specified in
Paragraph 2 of the Basic Terms, or to such other Person at any other address
that the Landlord designates by written notice; and (b) if to the Tenant, at the
Leased Premises, or, at the Landlord's option, to the Tenant's head office
address specified in Paragraph 4 of the Basic Terms.
A notice, demand, consent or request will be considered to have been
given or made on the day that it is delivered, or, if mailed, three (3) days
after the date of mailing. Either party may give notice to the other of a change
of the address set out above and the address specified in the notice will then
apply. If the postal service is or is expected to be interrupted, any notice,
demand, consent or request will only be delivered in person. If there is more
than one Tenant, it will suffice if the Landlord delivers or mails a notice,
demand, consent or request to only one of them.
Section 13.6 - Registration of Lease
The parties agree that a Notice of Short Form of a Lease may be
registered against the title to the property.
Section 13.7 - Rules and Regulations
The Tenant will comply with the Rules and Regulations. However, the
Tenant will not be responsible for complying with any Rules and Regulations in
addition to those contained in Schedule "C", unless notice of them is first
given to the Tenant. No Rules and Regulations will be enforced against the
Tenant in a discriminatory manner (although certain Rules and Regulations may
differentiate between different types of businesses), or impose any charge or
payment on the Tenant which is not expressly provided for in this Lease. The
Landlord is not responsible to the Tenant for any other Person's non-observance
of any Rules or Regulations.
Section 13.8 - Acceptance of Lease
The Tenant accepts this Lease of the Leased Premises to be held by it
as Tenant, subject to the terms set out in this Lease.
THE PARTIES HAVE SIGNED BELOW to indicate their agreement.
SIGNED, SEALED AND DELIVERED )FERCAN DEVELOPMENTS INC.
in the presence of: )
)
) Per:________________________
) Name:
) Title:
) I have the authority to bind
) the Corporation.
)
)
) NORTHERN ETHANOL ( CANADA)INC.
)
) Per:________________________ )
) Name:
) Title:
) I have the authority to bind
the Corporation
Page 20
SCHEDULE OF DEFINITIONS
"Additional Rent": any amounts payable by the Tenant under this Lease other than
Base Rent whether or not designated as Additional Rent and whether or not
payable to the Landlord. Additional Rent accrues daily.
"Alterations": any repairs, alterations, replacements, decorations or
improvements to the Leased Premises, whether as part of the Tenant's Work or
otherwise.
"Architect": any independent licensed architect, engineer or land surveyor
chosen by the Landlord.
"Basic Terms": the terms set out at the beginning of this Lease.
"Development" or "Building" means the Lands and the structures, buildings and
Facilities located on them from time to time, including the Common Elements and
all Leaseable Premises.
"Event of Default": whenever:
(a) any Rent is not paid when due and the non-payment continues for five (5)
days after notice to the Tenant;
(b) any of the Tenant's obligations under this Lease is breached (other than a
breach specified in paragraph (c)) and (i) the breach is not remedied within ten
(10) days after notice to the Tenant specifying particulars of the breach, or
(ii) if ten (10) days is not a reasonable time to remedy the breach, the Tenant
has not commenced diligently to remedy the breach within the ten (10) day period
or is not proceeding diligently to remedy the breach within a reasonable time;
or
(c) any of the following events occurs:
(i) the Tenant, or a Person carrying on business in a part of the
Leased Premises becomes bankrupt or insolvent or takes the
benefit of any statute for bankrupt or insolvent debtors or
makes any proposal, assignment or arrangement with its
creditors;
(ii) a receiver or manager is appointed for all or a part of the
property of the Tenant, or of another Person carrying on
business in the Leased Premises;
(iii) steps are taken for the dissolution, winding up or other
termination of the Tenant's existence or for the liquidation
of their respective assets, except as part of a bona fide
corporate reorganization permitted by this Lease;
(iv) the Tenant makes or attempts to make a bulk sale of assets
regardless of where they are situated (except for a bulk sale
made to a Transferee as part of a permitted Transfer);
(v) property is removed from the Leased Premises so that there
does not remain sufficient property on the Leased Premises
available for distraint, free and clear of any lien, charge or
other encumbrance ranking ahead of the Landlord's right of
distress, to satisfy the Rent due or accruing for at least six
(6) months;
(vi) the Leased Premises are vacant or unoccupied for fifteen (15)
consecutive days, or the Tenant abandons or attempts to
abandon the Leased Premises, except as may be specifically
permitted under this Lease;
(vii) the Tenant effects or attempts to effect a Transfer that is
not permitted under this Lease; or
(viii) this Lease or any of the Tenant's assets on the Leased
Premises are taken or seized under a writ of execution, an
assignment, charge or other security instrument.
Page 21
"Facilities": areas, facilities, Utilities, improvements, equipment, fixtures
and installations.
"Force Majeure": a strike, labour trouble, inability to get materials or
services, power failure, restrictive governmental laws or regulations, riots,
insurrection, sabotage, rebellion, war, act of God, or any other similar reason,
that is not the fault of the party asserting it. Force Majeure does not include
inability to obtain funds.
"GST": goods and services taxes, value-added taxes, multi-stage taxes, business
transfer taxes or other similar taxes however they are characterized.
"Gross Leaseable Area": 7,200 square feet.
"HVAC System": the heating, ventilating and air-conditioning Facilities operated
and maintained by the Landlord, including: (a) the buildings or areas which
house common heating, ventilating or air-conditioning Facilities; (b) units,
suspended or otherwise, designated by the Landlord as part of the HVAC System,
including heat pump units or re-heat coils, even if located in LaSalle Premises;
(c) fuel and power Facilities; (d) distribution piping, air handling units, duct
heater coils or re-heat coils and ventilation units; and (e) monitoring, energy
saving and control systems, including thermostats and ventilation systems
serving more than one tenant. The HVAC System does not include distribution
systems within LaSalle Premises, any tenant-maintained ventilation ducts,
make-up air facilities or booster units installed for one or more tenants to
satisfy excess or unusual requirements and the Tenant System.
"Hazardous Substances": any hazardous or toxic substances or materials including
any products of waste, asbestos, urea formaldehyde foam insulation, radon gas
and PCB's, or any other contaminant or pollutant, including any substance from
time to time defined as a contaminant or pollutant or as a hazardous or toxic
substance or material under any environmental law.
"Landlord": the party named in Paragraph 1 of the Basic Terms.
"Lands": the lands described in Schedule "A", as they may be altered from time
to time.
"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);
"Leased Premises": the premises municipally known as the 3rd Floor of ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇ and include the right to egress and ingress from King
Street to the said 3rd Floor in common with other tenants of the Building by way
of the existing staircase from King Street .The boundaries of the Leased
Premises extend from the top surface of the structural sub-floor to the top
surface of the 3rd Floor ceiling.
"Base Rent": the amounts payable under Section 3.1.
"Mortgagee": a creditor that holds all or part of the Development as security,
but a creditor, chargee or security holder of a tenant of LaSalle Premises is
not a Mortgagee.
"Operating Costs": the total amounts incurred by or on behalf of the Landlord in
insuring, operating, cleaning, administering, managing, supervising,
maintaining, repairing and replacing the Development, or any part thereof
including without duplication:
Page 22
(a) costs of non-separately metered Utilities and supplies and the cost of
heating, ventilating and air-conditioning the Development, including all costs
in connection with the HVAC System and any outside maintenance contracts;
(b) salaries and benefits of personnel (including on-site and designated
off-site management personnel) employed in connection with the Development and
reasonable management office rent imputed to the Development by the Landlord;
(c) costs of any Facilities added to the Development for the greater comfort and
convenience of customers or tenants;
(d) costs of environmental inspections or audits of the Development and of any
clean-up or removal of Hazardous Substances from the Development;
(e) depreciation or amortization of any costs (which are not charged fully in
the financial year they are incurred) of the maintenance, cleaning and operating
equipment, master utility meters and all other Facilities that are part of the
Common Elements including the HVAC System, in accordance with sound accounting
principles applicable to the Development industry;
(f) interest, calculated at two (2) percentage points above the Prime Rate, on
any undepreciated part of the costs referred to in paragraph (e);
(g) Realty Taxes payable by the Landlord with respect to the Common Elements;
(h) audit fees for the statements referred to herein; and
(I) an management fee equal to five percent (5) of the Base Rent, Taxes and
Operating Costs (exclusive of this subparagraph (I), depreciation and GST);
Operating Costs will not include, or there will be deducted from Operating
Costs: (I) net proceeds of insurance received by the Landlord from its insurers,
to the extent that the proceeds relate to costs previously included in Operating
Costs; (ii) repairs or maintenance specific to certain tenants or unleased
premises; (iii) tenant improvements, tenant allowances and leasing commissions;
(iv) income taxes (Capital Taxes are not considered to be income tax); (v)
interest on and capital retirement of debt; and (vi) ground rentals;.
"Owner": any owner of freehold or leasehold title(s) of all or a part of the
Development.
"Person": any person, firm, partnership, corporation or other legal entity,
including any combination of them.
"Prime Rate": the annual rate of interest from time to time publicly quoted by
the Canadian Imperial Bank of Commerce as its reference rate of interest
(commonly known as its "prime rate") for determining rates of interest
chargeable in Toronto on Canadian dollar demand loans to commercial customers.
"Public Corporation": a corporation whose shares are traded and listed on a
recognized stock exchange in Canada or the United States.
"Realty Taxes": the total of: (a) all real property taxes or charges from time
to time imposed in respect of all or any part of the Development by a taxing
authority (including local improvement taxes and taxes and other charges for the
Tenant's improvements, equipment and facilities in any part of the Development,
the business carried on in the Leased Premises and the use, occupancy or
ownership of any part of the Development by the Tenant or its subtenants or
licensees or the Landlord or the Owner), and any other amounts that may be
imposed instead of or in addition to them, whether against the Landlord, the
Tenant or the Owner and whether or not similar, in existence at the Commencement
Date, or within the contemplation of the parties; (b) all consulting, appraisal,
legal and other costs reasonably incurred in attempting to minimize or reduce
those amounts; and (c) all amounts allocated by the Landlord to the Development
in respect of salaries, benefits and other personnel costs and office expenses
related to the administration and management of the above-noted amounts. Realty
Taxes do not include corporate, income, profits or excess profits taxes assessed
upon the income of the Landlord except those that may be imposed instead of or
in addition to the taxes and charges described above. Realty Taxes shall in
every instance be calculated on the basis of the total Rentable Area of the
Development being assessed as fully leased and operational.
Page 23
"Released Persons": the Landlord and any Owner or Mortgagee, and each of their
respective directors, officers, employees (while in the ordinary course of their
employment) and agents. In connection with any release or other exculpatory
language or an indemnity in favour of the Released Persons, the Landlord is the
agent or trustee of and for the benefit of the Owner, the Mortgagee and all of
the directors, officers, employees and agents mentioned above.
"Rent": Base Rent, :and Additional Rent. Rent is payable in Canadian funds
without any deduction, abatement or set-off. Rent payable to the Landlord will
be paid to it at its head office or at any other place which the Landlord
designates in writing. Rent for any fractional month at the beginning or end of
the Term will be pro-rated on a daily basis using a period of 365 days.
"Rules and Regulations": the rules and regulations passed and revised by the
Landlord from time to time.
"Secured Claim": a construction or other lien or claim, a fixed or floating
charge, mortgage, security interest, debenture or other encumbrance, or a notice
of any of them.
"Sign": any sign, advertisement, picture, notice, lettering or decoration.
"Stipulated Rate": the annual rate of interest that is the lesser of (a) the
Prime Rate plus five (5) percentage points and (b) the maximum rate permitted by
law.
"Tenant": the party named as Tenant in Paragraph 3 of the Basic Terms.
"Term": the period set out in Paragraph 10 of the Basic Terms.
"Transfer": (a) an assignment, sale, conveyance, sublease, licensing or other
disposition, or a mortgage, charge or debenture (floating or otherwise) or other
encumbrance of this Lease or any interest in it or all or any part of the Leased
Premises (whether by operation of law or otherwise), or of any interest in a
partnership that is a Tenant under this Lease; (b) a parting with or sharing of
possession of all or part of the Leased Premises (including further subleases by
subtenants and assignments of subleases); (c) a transfer or issue by sale,
subscription, assignment, bequest, inheritance, operation of law or other
disposition, of all or part of the shares of the Tenant or any of its affiliates
(as currently defined under the Canada Business Corporations Act) which results
in a change in the effective voting control of the Tenant; or (d) a merger,
amalgamation or other similar corporate reorganization involving the Tenant.
"Transferor" and "Transferee" have corresponding meanings.
"Utilities": water, fuel, power, telephone and any other utilities used in the
Development.
"Utilities Charge": the total, without duplication, of: (a) the costs incurred
by the Landlord for Utilities used in the Leased Premises or allocated to them
by the Landlord; (b) the Landlord's costs of determining the Utilities Charge
including professional, engineering and consulting fees; and (c) an
Administration Fee on the costs described in paragraphs (a) and (b). Any
Utilities separately metered to the Leased Premises which are billed directly to
the Tenant by the supplier (other than the Landlord) will not be included in the
Utilities Charge.
Page 1
SCHEDULE "A"
DESCRIPTION OF THE LANDS
PIN 21094-0179 LT
PT TOWN LT ▇▇ ▇/▇ ▇▇▇▇ ▇▇ ▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇ ▇▇ ▇▇▇▇▇▇▇▇; S/T &T/W
CA446251;CITY OF TORONTO
Page 1
SCHEDULE "B"
RULES AND REGULATIONS
The Tenant will at its expense:
1. keep the inside and outside of all glass in the doors and windows of
the Leased Premises clean;
2. keep all exterior storefront surfaces of the Leased Premises clean;
3. promptly replace any cracked or broken window glass of the Leased
Premises;
4. keep the Leased Premises clean and orderly and free of pests; and
5. have garbage removed from the Leased Premises on a regular basis as
prescribed by the Landlord (including using the commercial pick-up and
disposal service designated by the Landlord, if the Landlord so
requires), and until removed, keep garbage in ratproof containers
within the interior of the Leased Premises.
The Tenant will not:
1. commit or permit waste upon or damage to the Leased Premises or any
nuisance or other act that disturbs the quiet enjoyment of other
tenants or occupants of the Development;
2. do anything that may damage the Development nor permit odours,
vapours, steam, water, vibrations, noises or other undesirable effects
to come from the Leased Premises;
3. place or maintain any merchandise or other articles in any vestibule
or entry of the Leased Premises, on the adjacent footwalks or
elsewhere on the exterior of the Leased Premises or the Common
Elements;
4. permit accumulations of garbage, trash, rubbish or other refuse within
or outside the Leased Premises;
5. permit the parking of delivery vehicles so as to interfere with the
use of any driveway, walkway, parking area, or other area of the
Development;
6. receive, ship, load or unload articles of any kind including
merchandise, supplies, materials, debris, garbage, trash, refuse and
other chattels except through service access facilities designated
from time to time by the Landlord;
7. use the plumbing facilities for any other purposes than that for which
they are constructed;
8. use any part of the Leased Premise for lodging, sleeping or any
illegal purposes;
9. solicit business and display merchandise except in the Leased
Premises, nor do or permit anything to be done in or on the Common
Elements or the Development that hinders or interrupts the flow of
vehicles and pedestrian traffic to, in and from the Development; or
10. permit on the Leased Premises any transmitting device nor erect an
aerial on any exterior walls of the Leased Premises or any of the
Common Elements, nor use travelling or flashing lights, signs or
television or other audio-visual or mechanical devices that can be
seen outside of the Leased Premises, or loudspeakers, television,
phonographs, radios or other audio-visual or mechanical devices that
can be heard outside of the Leased Premises. If the Tenant uses any
such equipment, the Landlord shall be entitled to remove it without
notice at any time, at the Tenant's cost, payable on demand.
TABLE OF CONTENTS
ARTICLE 1. - GRANT
Section 1.1 - The Leased Premises 1
Section 1.2 - Use of Common Elements 1
Section 1.3 - Quiet Enjoyment 1
Section 1.4 - First Option to Extend 1
ARTICLE 2. - CONSTRUCTION
Section 2.1 - Acceptance of the Leased Premises 2
Section 2.2 - Tenant Allowance 2
ARTICLE 3. - RENT
Section 3.1 - Minimum Rent 3
Section 3.2 - Taxes 3
Section 3.3 - Operating Costs and Utilities 3
Section 3.4 - Payment of Additional Rent 3
Section 3.5 - Post-dated Cheques or Pre-Authorized Payment Plan 3
Section 3.6 - Overdue Rent 4
Section 3.7 - Deposit 4
Section 3.8 - Rent Disputes 4
Section 3.9 - Gross Revenue Reports 4
Section 3.10 - Tenant's Records 4
Section 3.11 - Landlord's Right to Examine 4
Section 3.12 - Audit 4
Section 3.13 - Tenant's Failure 4
ARTICLE 4. - USE OF THE LEASED PREMISES
Section 4.1 - Use and Trade Name 4
Section 4.2 - Conduct of Business 4
Section 4.3 - Prohibited Activities 4
Section 4.4 - Compliance with and Observance of Law 5
Section 4.5 - Radius 5
Section 4.6 - Signs 5
ARTICLE 5. - TENANT'S INSURANCE, RELEASE AND INDEMNITY
Section 5.1 - Tenant's Insurance 5
Section 5.2 - Increase in Insurance Premiums 6
Section 5.3 - Cancellation of Insurance 6
Section 5.4 - Release 6
Section 5.5 - Indemnity 7
ARTICLE 6. - MAINTENANCE OF AND ALTERATIONS TO LEASED PREMISES
Section 6.1 - Maintenance of and Alterations to the Leased Premises 7
Section 6.2 - Repair Where the Tenant is at Fault 8
Section 6.3 - Removal of Alterations and Restoration of Leased Premises 8
Section 6.4 - Secured Claims 9
Section 6.5 - Overloading 9
Section 6.6 - HVAC Operation and Energy Conservation 9
ARTICLE 7. - LANDLORD'S COVENANTS
Section 7.1 - Landlord's Insurance 9
Section 7.2 - Maintenance and Repairs by the Landlord 9
Section 7.3 - Control of the Development by the Landlord 10
Section 7.4 - Landlord's Right of Entry 10
Section 7.5 - Redevelopment 10
ARTICLE 8. - DAMAGE AND DESTRUCTION AND EXPROPRIATION
Section 8.1 - Damage to the Leased Premises 11
Section 8.2 - Damage to or Expropriation of the Development 11
ARTICLE 9. - TRANSFERS
Section 9.1 - Consent Required 12
Section 9.2 - Transfer Conditions 13
Section 9.3 - Additional Terms Respecting Transfers 14
Section 9.4 - Transfer Clause 14
ARTICLE 10. - LANDLORD'S SALE OR FINANCING OF DEVELOPMENT
Section 10.1 - Sale by the Landlord 14
Section 10.2 - Subordination and Attornment 14
Section 10.3 - Status Statement 14
Section 10.4 - Financial Information 14
ARTICLE 11. - DEFAULT
Section 11.1 - Right to Re-enter 15
Section 11.2 - Re-entry Without Termination 15
Section 11.3 - Distress Waivers 15
Section 11.4 - Fraudulent Removal of Goods 15
Section 11.5 - Landlord May Cure the Tenant's Default 16
Section 11.6 - Application of Money 16
Section 11.7 - Remedies Generally 16
Section 11.8 - Expenses 16
ARTICLE 12. - INTENT AND INTERPRETATION
Section 12.1 - Gross Lease 16
Section 12.2 - Landlord and Representatives to Act Reasonably and in Good Faith 16
Section 12.3 - Entire Agreement and General Interpretation 17
Section 12.4 - Severability 17
ARTICLE 13. - MISCELLANEOUS
Section 13.1 - Overholding - No Tacit Renewal 17
Section 13.2 - Successors 17
Section 13.3 - Waiver 17
Section 13.4 - Force Majeure 18
Section 13.5 - Notices 18
Section 13.6 - Registration 18
Section 13.7 - Rules and Regulations 18
Section 13.8 - Acceptance of Lease 18
SCHEDULE OF DEFINITIONS
SCHEDULE "A" - LEGAL DESCRIPTION
SCHEDULE "B" - RULES AND REGULATIONS