EXHIBIT 5.16
OFFER TO SUB-LEASE
SUITE 210 - ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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(THE "BUILDING")
TO: ELECTRONIC ARTS (CANADA), INC. ("Sub-Landlord")
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WE: RECONNAISSANCE TECHNOLOGIES INC. ("Sub-Tenant")
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hereby offer to sub-lease from the Sub-Landlord, upon the following terms and
conditions, the premises on the second (2/nd/) floor of the Building, having a
Rentable Area of approximately 7,347 square feet (the "Sub-Lease Premises").
The floor area of the Sub-Lease Premises is as shown outlined in heavy black on
the plan forming Schedule "A" to the Offer to Sub-Lease.
1. TERM
The Term of the Sub-Lease shall be three (3) years and five (5) months and
twenty-nine (29) days commencing on the 1st day of June, 1999 (the
"Commencement Date") and expiring on the 29th day of November, 2002.
2. BASIC RENT
The Basic Rent, plus any applicable Goods and Services Tax, shall be
payable monthly in advance by the Sub-Tenant on the first day of each month
during the Term to the Sub-Landlord. The Basic Rent shall be based on the
Rentable Area of the Sub-Lease Premises and measured in a manner prescribed
by the Lease calculated at the following rates:
Months 1-12 - $5.00 per square foot per annum
Months 13-24 - $6.00 per square foot per annum
Months 25-42 - $6.50 per square foot per annum
3. OPERATING COSTS AND PROPERTY TAXES
The Sub-Tenant's Proportionate Share of Operating Costs and Property Taxes,
currently estimated at $10.00 per square foot for the 1999 fiscal year,
plus Goods and Services Tax, shall be payable as additional rent as per the
terms of the Lease during the Term in addition to the Basic Rent.
4. DEPOSIT
A cheque for $20,635.89 (the "Deposit") payable to the Sub-Landlord's
agent, Colliers ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Inc., in trust, shall be tendered upon
acceptance as the Deposit and to be credited in payment firstly towards the
last month's rent and thereafter towards the first rent due, plus any
applicable Goods and Services Tax, and to be returned to the Sub-Tenant if
this Offer is not accepted. In the event the Sub-Tenant defaults under the
terms hereof, the Sub-Landlord may
terminate this agreement and retain the Deposit on account of damages and
not as a penalty, without prejudice to any other remedy.
5. LEASE
The Sub-Tenant covenants to abide by all the terms of the Sub-Landlord's
Lease (the "Lease") with the exception of the terms set out in this Offer
which differ from the terms of the Lease. The Sub-Tenant acknowledges
having received a copy of the Lease.
6. ACCESS
For the purposes of planning and the construction of its Leasehold
Improvements, the Sub-Tenant shall have access to the Sub-Leased Premises
fifteen (15) days prior to the Commencement Date. During this period, the
Sub-Tenant shall not be obligated to pay any Basic Rent or Additional Rent
but shall abide by all other terms of the Lease.
7. SUB-LANDLORD'S WORK
The Landlord shall, at its cost, steam clean the carpets in the Sublease
Premises and permanently close off the entrance door to the adjacent suite.
8. SUB-LANDLORD TO DETERMINE FINANCIAL STRENGTH OF SUB-TENANT
Acceptance of this Offer by the Sub-Landlord is conditional upon the Sub-
Tenant providing the Sub-Landlord with information respecting the financial
status of the Sub-Tenant as the Sub-Landlord may reasonably require for the
purposes of determining the financial strength of the Sub-Tenant. The Sub-
Tenant shall furnish the Sub-Landlord with such information forthwith upon
acceptance of this Offer. The Sub-Landlord shall have five (5) business
days from the date of provision of the financial information to determine
whether or not the Sub-Tenant is acceptable to the Sub-Landlord. The Sub-
Landlord shall notify the Sub-Tenant within five (5) business days of
receipt of the financial information that the tenancy is acceptable to it,
failing which this Offer shall become null and void and the Deposit shall
be returned to the Sub-Tenant.
9. CONDITIONS PRECEDENT
This Offer and Acceptance is subject to the following Conditions Precedent
being waived at the sole discretion of the Sub-Tenant.
(a) Satisfactory review and acceptance of the Sub-Landlord's existing
Lease document.
(b) Approval of the Offer to Sub-Lease by the Sub-Tenant's Board of
Directors.
If the Sub-Tenant fails to notify the Sub-Landlord in writing that the
Conditions Precedent have been satisfied or waived prior to 5:00 p.m. on
the 27th day of April, 1999 or such other time as may be subsequently
agreed, then this Offer shall become null and void and the Deposit shall be
returned in full to the Tenant forthwith and neither party shall have
further obligation to the other. This clause is for the sole benefit of
the Sub-Tenant.
10. PARKING
The Sub-Landlord shall provide, at the Sub-Tenant's cost, up to fourteen
(14) random parking stalls in the Building at the prevailing market rates
currently $40.00 per stall per month. The Sub-Tenant shall specify the
number of parking stalls it requires prior to the Commencement Date. The
rental rates for stalls is subject to adjustment to comparable parking
rates in the area.
11. FREE BASIC RENT & OPERATING COSTS & PROPERTY TAXES
The Sub-Tenant shall have a Free Basic Rent and Operating Costs and
Property Taxes period during the first twelve (12) months from the
Commencement Date on 2,800 square feet only of the Sublease Premises.
During this period, the Sub-Tenant shall abide by all other terms of the
Lease.
12. USE
The Sublease Premises shall be used only for the purposes of a general
business office.
13. SOLE AGREEMENT
There are no agreements, covenants, representations, warranties or
conditions in any way relating to the subject matter of this agreement
expressed or implied, collateral or otherwise, except as expressly set
forth herein.
14. TIME OF THE ESSENCE
Time is of the essence of this agreement with respect to the covenants
contained herein.
15. DEFINITIONS
Words defined in the Lease and used herein shall have the same meaning
ascribed to them by the Lease.
16. CONSENT OF LANDLORD
This Offer is subject to the consent of the Landlord in accordance with the
terms of the Lease.
17. OFFER PROVISIONS
All terms of this Offer shall survive the completion of this transaction
and shall not merge. In the event of any conflict between the terms of
this Offer and the terms of the Lease, the terms of this Offer shall
prevail.
18. DISCLOSURE
The Sub-Landlord and the Sub-Tenant acknowledge and agree that:
(i) in accordance with the Code of Ethics of the Canadian Real Estate
Association, Colliers ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Inc. (the "Agent") has
disclosed that it is representing the Sub-Landlord and the Sub-Tenant
in the transaction described in this Agreement.
(ii) the Agent, in order to accommodate the transaction described in this
Agreement, was and is entitled to pass any relevant information it
receives from either party or from any other source to either of the
parties as the Agent sees fit, without being in conflict of its
duties to either party; and
(iii) the Sub-Landlord shall pay the commission and compensation due to
the Agent pursuant to the transaction described in this Agreement.
19. ACCEPTANCE
This Offer shall be irrevocable and open for acceptance until 5:00 p.m. on
the 23rd day of April, 1999, after which time if not accepted this Offer
shall be null and void and the Deposit shall be returned in full to the
Sub-Tenant. This Offer may be accepted by signing and returning one
duplicate copy or facsimile of this Offer.
DATED this 22/nd/ day of April, 1999.
RECONNAISSANCE TECHNOLOGIES INC.
SUB-TENANT
Per: /s/ ▇▇▇▇ ▇▇▇▇▇▇
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Per: _________________________
ACCEPTANCE
The Sub-Landlord hereby accepts the above Offer this _____ day of April, 1999.
ELECTRONIC ARTS (CANADA), INC.
SUB-LANDLORD
Per: _________________________
Per: _________________________
LANDLORD'S CONSENT
The Landlord hereby consents to the attached Offer this _____ day of April,
1999.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ REAL ESTATE GROUP
LANDLORD
Per: _________________________
Per: _________________________