EXHIBIT 10.29
LEASE AGREEMENT
Between
PHOENIX PLACE LTD.
(Landlord)
and
PINNACLE OIL INTERNATIONAL INC.
(Tenant)
for
▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ - ▇▇▇ ▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
(Building)
TABLE OF CONTENTS
ARTICLE II
1.00 Definitions................................................. 4
ARTICLE II
2.00 Demise...................................................... 7
ARTICLE III
3.00 Term........................................................ 7
3.01 Postponement of Term........................................ 7
3.02 Early Possession............................................ 7
ARTICLE IV
4.00 Rent........................................................ 7
4.01 Security Deposit............................................ 7
ARTICLE V
5.00 Tenant's Covenants.......................................... 8
5.01 Rent........................................................ 8
5.02 Operating Costs............................................. 8
5.03 Repair...................................................... 8
5.04 Notice of Accidents or Defect............................... 8
5.05 Assigning or Subletting..................................... 8
5.06 Business Tax................................................ 9
5.07 Tidiness.................................................... 9
5.08 Damage to Building.......................................... 9
5.09 Observe Rules and Reglulations.............................. 9
5.10 Use of Premises............................................. 10
5.11 No Prejudice Insurance...................................... 10
5.12 Premises Conform to Law..................................... 10
5.13 Use Conform to Law.......................................... 10
5.14 No Nuisance................................................. 10
5.15 Floor Load.................................................. 10
5.16 Escape of Water............................................. 11
5.17 Indemnify Landlord.......................................... 11
5.18 Release of Landlord......................................... 11
5.19 Notify Landlord............................................. 11
5.20 Not Permit Liens............................................ 11
5.21 Landlord Supply Electricity................................. 11
5.22 Tenant's Insurance.......................................... 12
5.23 Signs....................................................... 12
5.24 Name........................................................ 12
5.25 Blinds...................................................... 12
5.26 Tenant's Certificate........................................ 12
5.27 Application of Distress..................................... 12
5.28 Waiver Re Distress.......................................... 13
5.29 Not Register Lease.......................................... 13
5.30 Right of Entry.............................................. 13
5.31 Non-Waiver By Landlord...................................... 13
5.32 Additional Rent............................................. 13
5.33 Interest on Arrears......................................... 13
5.34 Access to Landlord.......................................... 14
5.35 Alterations by Landlord..................................... 14
5.36 Excavation.................................................. 14
5.37 Yield-Up.................................................... 14
5.38 Continuous Occupancy........................................ 14
5.39 Subordination............................................... 14
5.40 Relocation of Leased Premises............................... 14
ARTICLE VI
6.00 Landlord's Covenants........................................ 15
6.01 Quiet Possession............................................ 15
6.02 Pay Taxes................................................... 15
6.03 Insurance................................................... 15
6.04 Heat........................................................ 15
6.05 Air-Conditioning............................................ 16
6.06 Elevators................................................... 16
6.07 Repair of Apparatus......................................... 16
6.08 Access...................................................... 16
6.09 Washroom Facilities......................................... 16
6.10 Clean....................................................... 16
6.11 Repair Structure............................................ 16
6.12 Alterations By Tenant....................................... 17
6.13 Landlord's Certificate...................................... 17
ARTICLE VII
7.00 Mutual Covenants............................................ 17
7.01 Parking..................................................... 17
7.02 Tenant's Improvements....................................... 17
7.03 Destruction or Damage....................................... 18
7.04 Default..................................................... 18
7.05 Bankruptcy or Seizure....................................... 19
7.06 Force Majeure............................................... 19
7.07 Representations............................................. 19
7.08 Reservation to Landlord..................................... 19
7.09 Assignment by Landlord...................................... 19
7.10 Net Lease................................................... 20
7.11 Notices..................................................... 20
7.12 Landlord Not Unreasonably Interfere......................... 20
7.13 Headings.................................................... 20
7.14 Interpretation.............................................. 21
7.15 Governing Law............................................... 21
7.16 Overholding................................................. 21
7.17 Time of the Essence......................................... 21
7.18 Enurement................................................... 21
7.19 Acceptance.................................................. 21
SCHEDULE "A" - Legal Description of the Lands
SCHEDULE "B" - Demised Premises
SCHEDULE "C" - Rules and Regulations
SCHEDULE "D" - Landlord and Tenant Work
SCHEDULE "E" - Special Provisions
Parking Agreement (If Applicable)
L E A S E
---------
THIS INDENTURE made this 25/th/ day of November, 1997.
BETWEEN:
PHOENIX PLACE LTD. of the
City of Calgary, in the
Province of Alberta
(the "Landlord")
OF THE FIRST PART
AND:
PINNACLE OIL INTERNATIONAL INC.
(the "Tenant")
OF THE SECOND PART
ARTICLE I
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INTERPRETATION
1.00 DEFINITIONS
-----------
1.01 In this lease, unless the context otherwise requires:
(a) "Additional Rent" means any and all sums of money or charges required
---------------
to be paid by the Tenant under this lease (except Minimum Rent), whether or not
the same are designated "Additional Rent", whether or not the same are payable
to the Landlord or otherwise, and all such sums are payable in lawful money of
Canada without deduction, abatement, set-off or compensation whatsoever, except
as provided in this lease.
(b) "Architect" means the independent architect from time to time named by
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the Landlord. The decision of the Architect shall be final and binding on the
parties hereto, so long as such decisions are consistent with accepted
architectural standards in the Province of Alberta.
(c) "Building" means, collectively, the office tower situated on the
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Lands, together with all improvements, fixtures, facilities, installations,
equipment, systems, parking facilities, overhead, and plus fifteen walkways,
landscaping, and other necessities, now or at any time hereafter installed,
erected or placed upon the Lands as part of the Development, and all
appurtenances thereto.
(d) "Business Day" means the hours 7:00 a.m. through 6:00 p.m. on the days
------------
from Monday to Friday, inclusive, unless such day is a federal, provincial or
civic holiday observed in the City.
(e) "City" means the City of Calgary, a municipal corporation in the
----
Province of Alberta.
(f) "Commencement Date" means the 1/st/ day of February, 1998.
-----------------
(g) "Common Areas" means:
------------
(i) all foyers, lobbies, corridors, hallways, telephone rooms,
janitorial or storage rooms, electrical or air-conditioning rooms, and
washrooms in the Office Tower (except those within the premises of any
tenant that are restricted to the exclusive use of such tenant or tenants);
and
(ii) any sidewalks, yards, gardens, courtyards, patios, loading areas,
ramps or parking areas.
4
(iii) "DEMISED PREMISES" means the premises in the Building shown
----------------
outlined in red on the floor plan attached hereto as Schedule "B",
containing approximately FIVE THOUSAND EIGHT HUNDRED (5,800) square feet of
rentable area as determined in accordance with the BOMA Standard Method of
Measuring Floor Area.
(h) "DEVELOPMENT" means, collectively, the Lands and Buildings, and all
-----------
appurtenances thereto from time to time belonging, installed thereon, or forming
a part thereof.
(j) "LANDS" means those lands in the City upon which the Buildings are
-----
being or have been constructed, and which are more particularly described in
Schedule "A" hereto.
(k) "MINIMUM RENT" means the sum of SIXTY THREE THOUSAND EIGHT HUNDRED
------------ ----------------------------------
DOLLARS ($63,800.00) annually payable in equal consecutive monthly installments
--------------------
of FIVE THOUSAND THREE HUNDRED SIXTEEN DOLLARS AND SIXTY SEVEN CENTS ($5,316.67)
-----------------------------------------------------------------------------
each in advance on the first day of each and every calendar month during the
term of this lease, commencing, subject to postponement as provided in this
lease, on the 1/st/ day of FEBRUARY 1998 to and including the 31/st/ day of
----- ------------- ------
JANUARY 2003 without deduction, abatement, set-off or compensation whatsoever,
------------
except as provided in this lease. The foregoing rent is calculated on the basis
of ELEVEN DOLLARS ($11.00) p.s.f. for FIVE THOUSAND EIGHT HUNDRED (5,800) sq.ft,
----------------------- -----------------------------------
of leased space.
(l) "MORTGAGEE" means any mortgagee(s) for the time being of the
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Development or any part thereof.
(m) "OCCUPATION RENT" means the Minimum Rent plus estimated Additional
---------------
Rent on a day-to-day basis.
(n) "OPERATING COSTS AND TAXES" means, in any fiscal period designated by
-------------------------
the Landlord, all costs and expenses incurred by or on behalf of the Landlord,
with respect to and for complete operation, management, protection, security,
cleaning, repair and maintenance of the Development, and without in any way
limiting the generality of the foregoing, shall include:
(i) the salary and wages of all employees of the Landlord directly
employed in the operation, maintenance, repair and administration of the
Development (other than the Club Facilities);
(ii) the costs of goods, services, equipment and supplies (including
property taxes and insurance premiums) supplied or used or incurred
directly or indirectly in the operation, maintenance, repair and
administration of the Development, including common areas and parking
areas, including the heating and air-conditioning costs, elevator
maintenance, costs of providing hot and cold water, and electrical energy
supplied to the Development;
(iii) all taxes (including local improvement rates), rates, duties and
assessments that may be levied, rated, charged or assessed against the
Development and, without limiting the generality of the foregoing, every
tax, charge, rate, assessment or payment which may become a charge or
encumbrance upon or be levied or collected upon or in respect of the
Development, or any part thereof, whether charged by any municipal,
parliamentary or other authority; PROVIDED that the Tenant shall have the
right to contest by appropriate legal proceedings and validity of any tax
rate, including local improvement rate, assessment or other charge;
(iv) all charges for public services and utilities, including water,
gas, sewer, electrical power, steam or hot water used upon or in respect of
the Development and for fittings, machines, apparatus, meters, or other
things leased in respect thereof, and for all work or services performed by
any corporation or commission in connection with such utilities; and
but excluding:
(i) depreciation;
(ii) income taxes of the Landlord;
5
iii) interest, on debt charges and legal fees and disbursements for debt;
iv) charges for the repair of damage to the Development only to the
extent the Landlord is entitled to reimbursement therefore by tenants or
from the proceeds of insurance;
v) expenses incurred by the Landlord in respect of the installation of
partitions and other tenants' improvements; or
vi) leasing commissions;
PROVIDED HOWEVER, that if, in any such fiscal period the Building is less than
Ninety Seven percent (97%) occupied during the whole of the fiscal period,
"Operating Costs" shall mean the amount obtained by adjusting the actual
Operating Costs for such fiscal period as if the Building had been Ninety-Seven
percent (97%) occupied during the whole of such fiscal period, such adjustment
to be made by adding to or subtracting from the actual Operating Costs during
such fiscal period, such additional costs as would have been incurred if the
Building had been Ninety-Seven percent (97%) occupied.
(p) "Proportionate Share" means being the Tenant's portion of Operating
-------------------
Costs and Taxes, and being the proportion that the rentable area of the
Demised Premises bears to the rentable area of the Building.
(q) "Rules and Regulations" means the rules and regulations adopted by
---------------------
the Landlord from time to time acting reasonably and in such manner as would a
prudent Landlord of a reasonably similar Building. The Rules and Regulations
existing as at the Commencement Date are those set out in Schedule "C".
ARTICLE II
----------
2.00 DEMISE
------
2.01 In consideration of the rents, covenants and agreements herein
contained on the part of the Tenant to be paid, observed and performed, the
Landlord leases to the Tenant and the Tenant leases from the Landlord the
Demised Premises for use and occupation as a business office and for no other
purpose.
ARTICLE III
-----------
3.00 TERM
----
TO HAVE AND TO HOLD the Demised Premises for the term of five (5)
--------
years commencing on the Commencement Date, subject to postponement in the manner
hereinafter set forth.
3.01 Postponement of Term
--------------------
The Landlord shall make all reasonable efforts to have the Demised
Premises ready for occupancy before the Commencement Date. If the Demised
Premises are not ready for occupancy by such time, because of reasons other than
the failure of the Tenant, its employees, agents or contractors to promptly
complete the Tenant's improvements to the Demised Premises, the Commencement
Date shall be postponed for a period equal to the duration of the occurrence or
delay. The Landlord shall not be liable for any loss, injury, damage or
inconvenience which the Tenant may sustain by reason of the inability of the
Landlord to deliver the Demised Premises ready for occupancy on the Commencement
Date.
3.02 Early Possession
----------------
The Tenant may, if it desires, but only with the Landlord's prior
written approval, begin to use and occupy the Demised Premises or portions
thereof prior to the Commencement Date; PROVIDED that the Tenant shall pay an
Occupation Rent to the Landlord for such use and occupancy until the
Commencement Date. Such Occupation Rent shall be proportionate to the relation
that the area of the Demised Premises, occupied from time to time bears to the
entire area of the Demised Premises. Possession shall be granted and taken
subject to the terms and conditions of this lease, except to the extent that
such terms and conditions are inconsistent with this clause.
6
ARTICLE IV
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4.00 RENT
----
The Demised Premises are leased at the Minimum Rent plus Additional
Rent to be paid in advance, without deduction, on the first day of each and
every calendar month of the term to the office of the Landlord, or at such other
place as the Landlord may from time to time designate in writing.
4.01 Security Deposit
----------------
Payment of Minimum Rent for the last month of the term is acknowledged
as being received in the amount of SEVEN THOUSAND THREE HUNDRED THIRTY THREE
-----------------------------------------
DOLLARS AND THIRTY THREE CENTS ($7,333.33) from the Tenant upon the execution of
------------------------------------------
this lease; such payment shall be held by the Landlord, without liability for
interest, as security for the faithful performance by the Tenant of all the
terms, covenants and conditions of this lease, and if, at any time during the
term of this lease, the Minimum Rent, Additional Rent or other charges properly
payable to the Landlord hereunder are overdue and unpaid, then the Landlord may,
at its option, apply any portion of such security deposit toward the payment of
such overdue Minimum Rent, Additional Rent or other charge, without thereby
limiting or excluding any other rights which the Landlord may have hereunder or
at law, and if such security deposit is not so applied during the term hereof,
then such sum shall be applied as Minimum Rent for the FIRST ONE(1) AND THE LAST
-------------------------
ONE(1) MONTH of the term hereof.
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ARTICLE V
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5.00 TENANT'S COVENANTS
------------------
THE TENANT COVENANTS WITH THE LANDLORD AS FOLLOWS:
5.01 Rent
----
To pay the Minimum Rent and Additional Rent to the Landlord as
provided in this lease, without any deduction unless such deduction is provided
for in this lease.
5.02 Operating Costs
---------------
To pay monthly, in advance, to the Landlord as Additional Rent, along
with the Minimum Rent, an estimate of the Tenant's proportionate monthly share
of all Operating Costs, subject to adjustment, as may be required at the end of
each fiscal year.
5.03 Repair
------
To maintain and keep the Demised Premises and all improvements,
fixtures and things belonging thereto, or which at any time during the term
shall be erected, attached thereto, in good and substantial repair, order and
condition, except damage by perils and hazards covered by insurance, and the
Landlord and its agent, either alone or with workmen, servants or others, at all
reasonable times during the term, may enter upon the Demised Premises to inspect
the condition thereof, and if any repairs are required to be made to the Demised
Premises, and providing the Landlord delivers to the Tenant, in writing, a
notice setting forth the necessary repairs, then the Tenant shall repair the
Demised Premises in a good and workmanlike manner within the time period set
forth in the notice from the Landlord, and if there is not time period set forth
in the notice, then the repairs shall be done within a reasonable time and,
failing this, the Landlord and its agent, servants and employees may enter upon
the Demised Premises and have the same repaired in proper manner and to render
the account for such repairs to the Tenant, and the Landlord shall have the same
remedies to enforce payment thereof as the Landlord has in respect of arrears of
rent.
5.04 Notice of Accidents or Defect
-----------------------------
To give the Landlord prompt written notice of any accident to or
defect in the heating apparatus, electric light or other wires, or of any fire
in the Demised Premises of which the Tenant is aware but, unless otherwise
expressly provided, there shall be no obligation on the part of the Landlord to
repair or make good any such matters.
7
5.05 Assigning or Subletting
-----------------------
(a) That the Tenant shall not pledge, mortgage, assign or sublet or part
with possession of the Demised Premises or any part thereof, directly or
indirectly, without the prior written consent of the Landlord, which consent
will not be unreasonably withheld.
(b) Any assignment approved by the Landlord hereunder shall be in writing
and a copy of the written assignment shall be provided to the Landlord within
Seven (7) days of the date of the assignment. No assignment or pledge of this
lease or sub-lease of the Demised Premises, or any part thereof, shall in any
manner relieve the Tenant from its responsibilities under all of the terms,
covenants and conditions of this lease. Any violation of any provision of this
lease, whether by act or omission, by any assignee or sub-tenant, shall be
deemed a violation of such provision by the Tenant.
(c) If a request is made to the Landlord to consent to an assignment of
this lease or a sub-letting of the whole or a part of the Demised Premises, then
the Landlord shall have the right, to be exercised within Fourteen (14) days
after the receipt of such request;
(i) if the request is to assign this lease or sublet the whole of
the Demised Premises, to cancel and terminate this lease; or
(ii) if the request is to sublet a part of the Demised Premises to
cancel or terminate this lease with respect to such part of the Demised
Premises;
and if the Landlord shall exercise any such right, then in each case, the
termination date shall be such date as is stipulated in the Tenant's notice,
which shall, in any event, be not less than Sixty (60) days and not more than
Ninety (90) days following the giving of such notice by the Tenant. If the lease
is so terminated with respect to a part of the Demised Premises, then rent
payable under this lease shall thereafter ▇▇▇▇▇ proportionately and all other
appropriate recalculations shall be made to recognize that the area of the
Demised Premises has been reduced. All of the foregoing rights of the Landlord
shall be alternative to, but not in substitution for, any other rights which the
Landlord may have to either consent or withhold its consent to any such
assigning or sub-letting.
(d) If at any time during the term of this lease any or all of the voting
shares of the Tenant, or of a parent corporation of which the Tenant is a direct
or indirect subsidiary, shall be transferred by sale, assignment, bequest,
inheritance, operation of law or other disposition so as to result in a change
in the present effective voting control of the Tenant or of such parent
corporation on the date of this lease, then the Tenant shall promptly notify the
Landlord in writing of such change, and the Landlord may terminate this lease at
any time after such change in control by giving the Tenant Forty-Five (45) days
written notice of such termination; PROVIDED, HOWEVER, that this provision shall
not apply to tenants which are public companies having more than Fifty (50)
shareholders at the date of this lease.
(e) If the Tenant is a partnership and if at any time during the term of
this lease any person, who at the time of the execution of this lease owns a
partner's interest, ceases to own such partner's interest, such cessation of
ownership shall constitute an assignment of the lease of all purposes of this
clause.
5.06 Business Tax
------------
To pay all taxes with respect to all business carried on in the
Demised Premises, and any special franchise or other tax with relation to such
business as and when such taxes become due and payable, together with any taxes
levied on tenants' fixtures and improvements made in or to the Demised Premises
by or for the Tenant, and all taxes in the nature of business taxes and any
taxes levied on machinery or equipment of the Tenant assessed by any
governmental authority upon the Demises Premises whether levied against the
Landlord or the Tenant.
5.07 Tidiness
--------
To leave the Demised Premises in a reasonably tidy condition at the
end of each business day for performance of the cleaning services.
8
5.08 Damage to Building
------------------
That if the Building, including the Demised Premises, elevators,
boilers, engines, pipes and other apparatus (or any of them) used for the
purpose of heating or air-conditioning the Building or operating the elevators,
or, if the water pipes, drainage pipes, electric lighting, windows or other
equipment of the Building get out of repair or become damage or destroyed
through the negligence, carelessness or, misuse by the Tenant, its servants or
employees or through it or them in any way stopping up or injuring the heating
apparatus, elevators, water pipes, drainage pipes or other equipment or any part
of the Building, the expense of the necessary repairs, replacements or
alterations shall be borne by the Tenant who shall pay the same to the Landlord
forthwith on demand, unless such damage is covered by the Landlord's insurance.
5.09 Observe Rules and Regulations
-----------------------------
That the Tenant, its servants and employees shall observe and comply
strictly with the rules and regulations. The Landlord shall have the right to
make reasonable changes in and additions to the rules and regulations; PROVIDED
such changes and additions do not unreasonably affect the conduct of the
Tenant's business, and shall promptly notify the Tenant thereof in writing. Any
failure by the Landlord to enforce any rules and regulations, now or hereafter
in effect, either against the Tenant or any other tenant in the Building, shall
not constitute a waiver of any of the rules and regulations.
5.10 Use of Premises
---------------
The Tenant shall use and occupy the Demised Premises for general
office purposes only and shall comply in respect of such used with the
requirement of federal, provincial and municipal laws and regulation. If a
government license or permit shall be required for the proper and lawful conduct
of the Tenant's business, and if the failure to secure such license or permit
would affect the Landlord, the Tenant, prior to occupying the Demised Premises,
shall procure the same for inspection by the Landlord. The Tenant shall at all
times comply with the terms and conditions of any such license or permit.
5.11 No Prejudice Insurance
----------------------
That the Tenant will not do or omit or permit to be done upon the
Demised Premises anything which shall cause the rate of insurance upon the
Building to be increased and that, if the rate of insurance upon the Building
shall be increased by reason of use made of the Demised Premises or by the
reason of anything done or committed or permitted to be done or omitted by the
Tenant or by anyone permitted by the Tenant to be upon the Demised Premises, the
Tenant will pay to the Landlord, on demand, the amount of such increase. The
Tenant will comply in every respect with the rules and regulations, if any, of
the Canadian Underwriters Association or any successor or substitute body, and
with the requirements communicated to the Tenant of the Landlord's insurance
company or companies having policies insuring the Building or the use thereof.
5.12 Premises Conform to Law
-----------------------
To comply with all provisions of law, including, without limitation,
federal, provincial and municipal legislative enactments, rules and regulations,
and by-laws, without limiting the generality of the foregoing, which relate to
the partitioning, equipment, operation and use of the Demised Premises, and to
the making of any repairs, replacements, alterations, additions, changes,
substitutions or improvements of or to the Demised Premises, and comply with all
police, fire and sanitary regulations or directive imposed or made by any
federal, provincial or municipal authorities or by fire insurance underwriters
or companies.
5.13 Use Conform to Law
------------------
The Tenant shall, at its expense, comply with all laws, orders,
ordinances and regulations of federal, provincial and municipal authorities and
with any direction made pursuant to law or by any public officer of officers
which shall, with respect to the use of the Demised Premises, or to the
abatement of nuisance, impose any violation, order or duty upon the Landlord or
the Tenant regarding the Demised Premises or the use or occupation thereof
arising from the Tenant's use of the Demised Premises or from conditions which
have been created by or at the instance of the Tenant or are required by reason
of a breach of any of the Tenant's covenants or agreements hereunder. If the
Tenant should desire to contest the validity of any such law, ordinance, rule,
order or regulation with which the Tenant is obligated to comply, it may, at its
expense, carry on such contest and non-compliance by it during such contest
shall not be deemed a breach of this covenant; PROVIDED that it shall, to the
satisfaction of the Landlord, indemnify and hold the Landlord harmless against
the cost thereof and against all liability for any damages, interest, penalties
and
9
expenses (including reasonable legal expenses on a solicitor and client basis)
resulting from or incurred in connection with such contest or non-compliance,
except that noncompliance shall not continue so as to subject the Landlord to
prosecution for an offence or to cause the Building or any part thereof to be
condemned or vacated by order of public authority.
5.14 No Nuisance
-----------
Not to do or suffer any waste or damage, disfiguration or injury to
the Demised Premises or the fixtures and equipment thereof; and not to use or
permit to be used any part of the Demised Premises for any dangerous, noxious or
offensive trade, business or occurrence, and not to cause or maintain or permit
the occurrence or maintenance of any nuisance in, at or on the Demised Premises,
or the creation or emission of any noxious fumes thereon or therefrom.
5.15 Floor Load
----------
The Tenant shall not place or permit to be placed a load upon any
portion of any floor of the Demised Premises which exceeds the floor load which
the area of such floor being loaded was designed to carry having regard to the
loading of adjacent areas. The Landlord reserves the right to prescribe the
weight and position of all safes and heavy installations which the Tenant wishes
to place in the Demised Premises so as to properly distribute the weight
thereof, and the Tenant agrees to such reservation.
5.16 Escape of Water
---------------
The Tenant shall be responsible for any loss or damage whatsoever
caused in the Building owing to the leakage or escape of any water, gas or other
substance from any pipes, machinery or equipment installed by the Tenant and
used for the purposes of servicing the Demised Premises or any machinery or
equipment installed or put therein by the Tenant. The responsibility of the
Tenant is subject to the exception of loss or damage due to negligent acts or
omissions or wilful or wanton misconduct of the Landlord or its agents,
servants, employees, independent contractors or other persons for whom the
Landlord is responsible for at law.
5.17 Indemnify Landlord
------------------
To indemnify and save harmless the Landlord against and from any and
all claims by or on behalf of any person, firm or corporation arising from the
conduct of any work by or through any act of negligence of the Tenant or any
assignee, sub-tenant, agent, contractor, servant, employee, licensee, customer
or invitee of the Tenant, and against and from all costs, counsel fees, expenses
and liabilities incurred in or about any such claim or action or proceeding
brought thereon.
5.18 Release of Landlord
-------------------
That the Landlord shall not be responsible for injury to or the death
of any person in or about the Demised Premises or any damage to any merchandise,
goods, chattels, machinery, equipment, fixtures or tenant improvements located
within the Building with the express of implied consent of the Tenant or in
respect of the Tenant's business. The Landlord shall not be responsible for
insuring any trade fixtures, stock installed or located by the Tenant in any
part of the Demised Premises. The Tenant shall insure its own stock, furniture
and equipment and shall be solely responsible for the loss of or damage to
property of others kept or located in the Demised Premises during the term
hereof.
5.19 Notify Landlord
---------------
To immediately notify the Landlord or its representative in the
Building of any accidents or defects in the Building including, without
limitation, the Demised Premises, water pipes, plumbing and heating apparatus,
ventilation and air-conditioning equipment and electrical wiring and fixtures
and, as well, of any matter or condition which may cause injury or damage to the
Building or any person or property therein located.
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5.20 Not Permit Liens
----------------
The Tenant shall promptly pay, as and when the same falls due, all
accounts for labour or material done or supplied for all improvements,
installations, partitions and fixtures or work done by or for the Tenant on the
Demised Premises and will not cause, suffer or permit any encumbrance, lien or
charge to arise or exist or be claimed upon the Demised Premises in respect
thereof; PROVIDED that any such lien shall be permitted if and so long as it
does not embarrass or prejudice the Landlord and if the Tenant has agreed to
indemnify and save harmless the Landlord in respect of the same having given the
Landlord reasonable security to insure the due payment of the same, and the
Tenant proceeds with all due diligence to take whatever steps are properly open
to it cause the validity of such claim to be determined and any registration of
such claim against the title to the Lands to be extinguished or the lien to be
paid if found valid, notwithstanding the foregoing, the Landlord may require
that the Tenant remove the lien forthwith.
5.21 Landlord Supply Electricity
---------------------------
To allow the Landlord to supply to the Demised Premises all of the
electricity used therein for building standard lighting and the operation of
typewriters and other small equipment used for office purposes. If the Tenant's
electrical requirements appear to exceed the normal use of electricity, the
Landlord may, at its discretion and at the cost of the Tenant, have the Demised
Premises separately metered.
5.22 Tenant's Insurance
------------------
(a) The Tenant agrees to take out and keep in force during the term hereof
general public liability insurance on an occurrence basis with respect to, the
business carried on, in or from the Demised Premises and the use of occupancy
thereof by the Tenant in the sum of not less than ONE MILLION DOLLARS
($1,000,000.00), inclusive, which insurance shall include the Landlord as a name
insured and shall protect the Landlord in respect of claims by the Tenant as if
the Landlord were separately insured. The Tenant shall furnish to the Landlord,
if and whenever requested by the Landlord, certificates or other satisfactory
evidence as to such insurance.
(b) The Tenant shall, throughout the term of this lease, provide and keep
in force property damage insurance in respect of the Tenant's furniture and
trade fixtures and such other property in or forming part of the Demised
Premises, as the Landlord may from time to time require, against such perils and
in such amounts as are normally insured in the circumstances by prudent tenants,
and as the Landlord may require or approve. At the request of the Landlord, the
Tenant shall file with the Landlord such copies of current policies or
certificates from insurance agents and proof of their renewal and payment of
premium as the Landlord may require, and if the Tenant fails to insure or to
file satisfactory proof of insurance promptly when so required, the Landlord
may, without notice to the Tenant, effect such insurance and recover any
premiums paid therefor from the Tenant on demand. The Tenant shall promptly pay
all premiums due on the insurance required to be effected by it hereunder and
shall not do anything upon the Demised Premises which would impair or invalidate
the obligation of the insurer, whether of the Landlord or of the Tenant, and if
the insurance premiums of the Landlord shall increase because of anything done
or omitted by the Tenant of the Demised Premises, the amount of increase shall
be paid by the Tenant to the Landlord on demand.
The Tenant agrees to name the Landlord and the Landlord's manager of
the Development as additional insureds in all insurance policies placed pursuant
to this clause.
5.23 Signs
-----
The Tenant shall not cause or permit any sign, picture, advertisement,
notice, lettering, flag, decoration or direction to be painted, displayed,
inscribed, placed, affixed or maintained in or on any windows or doors of the
Building nor anywhere else on or in the Building.
5.24 Name
----
The Tenant may use the name of the Building for the business address
of the Tenant, but for not other purpose.
5.25 Blinds
------
The Tenant will not install any blinds, drapes, curtains, or other
windows coverings in the Demised Premises and will not remove, add to or change
the blinds, curtains, drapes or other window covering, installed by the Landlord
from time to time, and agrees to keep window coverings open or closed at
11
various times as the Landlord may from time to time direct or as may be provided
from time to time by the rules and regulations.
5.26 Tenant's Certificate
--------------------
The Tenant agrees at any time and from time to time, upon not less
than Ten (10) days' prior notice, to execute and deliver to the Landlord a
statement in writing certifying that this lease is unmodified and in full force
and effect (or, if modified, stating the modifications and that the same is in
full force and effect as modified), the amount of the Minimum Rent plus
Additional Rent then being paid for hereunder and the dates to which the same,
by instalments or otherwise, and other charges hereunder, have been paid and
whether or not there is any existing default on the part of the Landlord of
which the Tenant has notice.
5.27 Application of Distress
-----------------------
The Tenant covenants and agrees that all of its furniture, trade
fixtures, partitions, installations, equipment and other moveables on the
Demised Premises, or wherever situated, shall be liable to distress and sale in
the usual manner for any arrears of rent owing with respect to the Demised
Premises and that none of the aforesaid goods and chattels upon the Demised
Premises shall be exempt from distress, and for the purposes of making such
distress, the Landlord by itself, its agents and baliffs may break open any door
or window and enter upon the Demised Premises at any time after rental shall
accrue due.
5.28 Waiver Re Distress
------------------
The Tenant waives and renounces the benefit of any present or future
statute taking away or limiting the Landlord's right of distress, and covenants
and agrees that, notwithstanding any such statute, none of the goods and
chattels of the Tenant on the Demised Premises at any time during that term
shall be exempt from levy by distress for rent in arrears.
5.29 Not Register Lease
------------------
That the Tenant will not register this lease in this form at the Land
Titles Office; PROVIDED that the Tenant shall be at liberty to register a caveat
in respect hereof which shall disclose only the existence, term and any renewal
of this lease.
5.30 Right of Entry
--------------
The Tenant further covenants and agrees that, on the Landlord becoming
entitled to cancel this lease under any of the provisions thereof, the Landlord
in addition to all other rights, shall have the right to re-enter the Demised
Premises or any portion or portions thereof as agent of the Tenant, either by
force or otherwise, without being liable for any prosecution therefor, and to
re-let the Demised Premises or any portion or portions thereof as agent of the
Tenant, to take possession of any furniture or other property on the Demised
Premises and to sell the same at a public or private sale without notice and to
apply the proceeds of such sale and any rent derived from reletting the Demised
Premises upon account of the rent under this lease, and the Tenant shall be
liable to the Landlord for any deficiency, if any.
The Tenant shall pay to the Landlord, on demand, such reasonable
expenses as the Landlord may incur in evicting the Tenant, re-letting the
Demised Premises, or collecting arrears of rent, including legal costs,
solicitors' fees (on a solicitor-client basis) and brokerage fees, and the
expenses of keeping the Demised Premises in good order and of preparing the
Demised Premises for re-letting.
5.31 Non-Waiver By Landlord
----------------------
That failure of the Landlord to insist upon strict performance of any
of the covenants or conditions of this lease or to exercise any right or option
herein contained shall not be construed as a waiver or relinquishment of any
such covenant, condition, right or option, but the same shall remain in full
force and effect. The acceptance by the Landlord of any rent from any person
other than the Tenant shall not be construed as a recognition of any rights
which are not herein expressly granted, or as a waiver of any of the Landlord's
rights, or as an admission that such person is, or as a consent that such
persons shall be deemed to be, any assignee of this lease or a sub-tenant of the
Demised Premises, or any portion thereof, irrespective of whether the Tenant or
said person claims that such person is a sub-tenant or assignee. The Landlord
may accept rent from any person occupying the Demised Premises at any time
without in any way waiving any right under this lease.
12
5.32 Additional Rent
---------------
All sums paid or expenses incurred hereunder by the Landlord, which
ought to have been paid or incurred by the Tenant, or for which the Landlord
hereunder is entitled to reimbursement from the Tenant, and any interest owing
to the Landlord hereunder may be recovered by the Landlord as Additional Rent by
any and all remedies available to it for the recovery of rent in arrears, and
shall be deemed to be rent in arrears.
5.33 Interest On Arrears
-------------------
All rent in arrears and all sums paid or expenses incurred by the
Landlord, which ought to have been paid or incurred by the Tenant, or for which
the Landlord is entitled hereunder to reimbursement from the Tenant and which
under the preceding clause of this lease shall be deemed to be rent in arrears,
shall bear interest from the date the same became due and payable by the Tenant
to the Landlord until the date of payment or repayment to the Landlord; PROVIDED
that, in each such case the Landlord shall give written notice to the Tenant of
such sums due and payable, and the Tenant shall have Seven (7) days after
receipt of such written notice from the Landlord to pay such arrears and, if
such amounts are paid during such period, the aforesaid interest shall not be
chargeable. Such interest will be charged at the rate of Eighteen percent (18%)
per annum.
5.34 Access to Landlord
------------------
The Landlord may, at any time and without liability to the Tenant,
enter the Demised Premises to examine the same or for any purpose which it may
deem advisable for the operation and/or maintenance of the Building or its
equipment. During the last Six (6) months of the term of this lease, the Tenant
shall allow such person or persons as may be desirous of leasing the Demised
Premises to visit the same on business days, between the hours of 9:00 o'clock
in the morning and 5:00 o'clock in the evening; PROVIDED reasonable notice is
given to the Tenant.
5.35 Alterations by Landlord
-----------------------
The Landlord shall have the right at any time during the term to
repair, remodel, alter improve or add to the whole or any part of the Building
(or to change the location of the entrance or entrances to the Building, or to
change, alter, remodel, or improve or add to the common areas, elevators,
escalators, drains, pipes, heating and air-conditioning apparatus or any other
part of the Building) except the Demised Premises without compensation or
responsibility to the Tenant. For such purposes, the Landlord may, if necessary,
enter, pass through, work upon and attach scaffolds or other temporary
structures to the Demised Premises. The Landlord agrees to carry out such work
as quickly as possible causing as little disturbance as possible.
5.36 Excavation
----------
In the event that an excavation should be made for building or other
purposes upon land adjacent to the Development, or should be authorized to be
made, the Tenant shall, if necessary, afford to the person or persons causing or
authorized to cause such excavation, license to enter upon the Demised Premises
for the purpose of doing such work as shall reasonably be necessary to protect
or preserve the wall or walls of the Building, or the Building from injury or
damage and to support them by proper foundation, pinning and/or underpinning.
5.37 Yield-Up
--------
At the expiration or sooner termination of this lease, the Tenant will
peaceably surrender and give up the Demised Premises, without notice from the
Landlord, any right or notice to quit or vacate being hereby expressly waived by
the Tenant, any law, usage of custom to the contrary notwithstanding.
5.38 Continuous Occupancy
--------------------
The Tenant shall carry on business at the Demised Premises on a
regular basis and not leave the Demised Premises unoccupied for a period of
Fifteen (15) days or longer without the prior written consent of the Landlord.
13
5.39 Subordination
-------------
In the event of registration of this lease (or caveat giving notice
thereof) in the Land Titles Office by the Tenant or agent, and in the further
event of a mortgage or mortgages being registered against title to the Lands, or
any part thereof, such mortgage or mortgages, at the election of the mortgagee
or mortgagees, shall take priority over this lease in every respect, and the
Lessee shall, without delay, execute and deliver to the Lessor any and all
documents required for such purpose, including postponements or instruments of
subordination under the appropriate legislation dealing with such matters;
PROVIDED, HOWEVER the Tenant and the said mortgagee shall enter into a
non-disturbance agreement.
5.40 Relocation of Leased Premises
-----------------------------
The Landlord shall have the right at any time upon sixty (60) days
notice to give the Tenant notice of relocation (the "Notice of Relocation") to
relocate the Tenant to other premises in the Building (hereinafter called the
"Relocated Premises") which premises shall contain the same as, or greater,
Rentable Area than the originally-leased Demised Premises.
The Landlord shall provide at its expenses leasehold improvements
(hereinafter called the "New Leasehold Improvements") in the Relocated Premises
substantially equivalent to the standard of the leasehold improvements in the
originally-leased Demised Premises which have been completed or which the
Landlord is obligated to provide in the originally-leased Demised Premises.
The Landlord shall pay for the reasonable moving costs (if any) from
the originally-leased Demised Premises to the Relocated Premises of the Tenant's
trade fixtures and furnishings which payment shall be deemed to be full and
complete compensation for all costs, expenses and damages which the Tenant may
suffer or incur in connections with the relocation including disruption and loss
of business. The Minimum Rent for the Relocated Premises for the period of the
first one (1) month of occupancy shall ▇▇▇▇▇.
The Minimum Rent and Additional Rent for the Relocated Premises shall
be no greater than the Minimum Rent and Additional Rent for the originally-
leased Demised Premises, notwithstanding the Relocated Premises may contain a
greater Rentable Area.
All other terms and conditions of the Lease shall apply to the
Relocated Premises mutatis mutandis, and the Lease shall be deemed to be amended
------- --------
accordingly.
ARTICLE VI
----------
6.00 LANDLORD'S COVENANTS
--------------------
THE LANDLORD COVENANTS WITH THE TENANT AS FOLLOWS:
6.01 Quiet Possession
----------------
That upon the Tenant paying the rent hereby reserved at the time and
manner aforesaid and observing and performing each and every one of the
covenants, conditions, restrictions and stipulations by the Tenant to be
observed or performed under this lease, the Tenant shall and may peaceably and
quietly possess and enjoy the Demised Premises during the said term without
interruption from or by the Landlord, or by any persons lawfully claiming by,
through or under it.
6.02 Pay Taxes
---------
To pay all rates, charges and assessments and taxes which may be
rated, charged, assessed and taxed against the Demised Premises during the term
of this lease other than such obligations which the Tenant herein has expressly
agreed to pay.
6.03 Insurance
---------
The Landlord will maintain insurance against fire, "extended coverage"
perils and such other risks as are included in a standard additional perils
supplementary insurance in an amount equal to the full replacement value of the
Building, the equipment and leasehold improvements contained in the Building,
excluding the Tenant's furniture, equipment and trade fixtures (with respect to
which the Tenant is required to
14
insure). The Landlord will place and maintain public liability insurance in
respect of all common areas of the Building with limits of not less than ONE
MILLION DOLLARS ($1,000,000) for any one occurrence. The Landlord will, in
addition, place and maintain pressure vessel and income protection insurance
(respecting rental abatement provided for in Clause 7.03) in respect of income
to the Landlord from the operation of the Building. The foregoing insurance
policies shall provide that the insurers waive any rights of subrogation against
the Tenant.
6.04 Heat
----
To furnish adequate heating to the Demised Premises at all times and
during the normal heating season as established by custom and practice for
similar buildings in the City; PROVIDED, HOWEVER, the Landlord may withhold the
supply of heat when necessary by reason of accident or breakdown or during
repairs or improvements which, in the opinion of the Landlord, are necessary.
6.05 Air-Conditioning
----------------
To operate (in accordance with standard office building procedures for
the City) the air-conditioning equipment during business days between the hours
of 7:00 a.m. and 6:00 p.m. in the manner appropriate to the season of the year,
except during the making of repairs; PROVIDED FURTHER, that the Landlord shall
not be responsible for the failure of air-conditioning equipment to perform its
function if such failure shall result from any arrangement of partitioning in
the Demised Premises or changes or alterations thereto, or failure on the part
of the Tenant to shade windows which are exposed to the sun, or from any
excessive use of electrical power by the Tenant.
6.06 Elevators
---------
To operate the elevators by electric or other power and, except when
prevented by a failure of electricity or other power or by reason of repairs or
other causes beyond the control of the Landlord, to operate at least one of the
elevators each day at all times for the reasonable use of the Tenant, and to
permit the Tenant, its agents, servants or employees, and all other persons
lawfully requiring communication with it, the free use of the elevators while
operating, in common with other persons lawfully using the same.
6.07 Repair of Apparatus
-------------------
In case the apparatus, or any part thereof, used in the elevators,
heating, air-conditioning or caretaking of the Demised Premises becomes
inoperable, damaged, malfunctioning or destroyed, the Landlord shall have a
reasonable time within which to repair the damage or replace or repair the
apparatus, and the Landlord shall not, in any event, be liable to the Tenant,
its officers or employees for any indirect or consequential damage or damages
for personal discomfort or illness arising by reason of the interruption of such
services or any of them.
6.08 Access
------
To permit the Tenant and the employees of the Tenant and all persons
attending on them to have the use during normal business hours on business days
in common with others of the main entrance and the stairways, corridors and
elevators leading to the Demised Premises. At times other than during normal
business hours, the Tenant and the employees or the Tenant and persons attending
on them shall have access to the Building and to the Demised Premises and use of
the elevators only in accordance with the rules and regulations.
6.09 Washroom Facilities
-------------------
The Landlord agrees to permit the Tenant, its agents, officers,
employees, invitees and licensees, the right of access and the use in common
with other tenants of the Building to the washroom facilities in the Building,
other than those provided exclusively for the use of other tenants, and to keep
the said facilities in good working order and to have the same repaired with all
reasonable diligence whenever such repairs are necessary.
6.10 Clean
-----
To provide cleaning and janitorial services, including window
cleaning, to the Demised Premises and Building, to standards consistent with the
maintenance of similar office buildings in the City; PROVIDED, HOWEVER, the
Landlord shall not be liable for acts of omission or commission on the part of
any person employed to perform such work.
15
6.11 Repair Structure
----------------
To make structural repairs, at his expense, to the perimeter walls
(excluding plate glass windows and doors), roof bearing structure and
foundation. In the event that any such repairs shall be required to be made by
the Landlord by reason of the negligence of the Tenant, its agents or employees,
the Landlord shall be entitled to recover the cost thereof from the Tenant, and
if the Tenant shall fail to pay the same, on demand, the Landlord may recover
the amounts so due by all remedies available to it for the recovery of rent in
arrears.
6.12 Alterations By Tenant
---------------------
The Tenant may, with the prior written consent of the Landlord, from
time to time improve, alter or change the fixtures and/or tenant's improvements
or equipment in the Demised Premises; PROVIDED THAT:
a) The Tenant shall have supplied the Landlord with plans and
specifications for such improvements, alterations or changes;
b) The Tenant shall cause all work done in connection with any
improvement, alteration or change to be done promptly and in a good and
workmanlike manner and in accordance with the plans and specifications
therefor which have been approved by the Landlord;
c) That any or all work to be done and material to be supplied in
connection with such improvements, alterations or changes shall, unless
otherwise agreed by the Landlord, be done or supplied only by contractors
or sub-contractors and workmen engaged by the Tenant but first approved by
the Landlord, and the Landlord shall have the right to grant such approval
conditionally or to withdraw the same at any time with cause; and
d) In any event, any work performed by or for the Tenant shall be
performed by competent workmen whose labour union affiliations are not
incompatible with those of any workmen who may be employed on the
Development by the Landlord, its contractors or subcontractors.
6.13 Landlord's Certificate
----------------------
The Landlord shall furnish to the Tenant, upon written demand, as soon
as possible after the end of each fiscal year of this lease, a certificate of
the Landlord or his agent specifying the Operating Costs for such fiscal year.
ARTICLE VII
-----------
7.00 MUTUAL COVENANTS
----------------
IT IS HEREBY MUTUALLY AGREED BETWEEN THE LANDLORD AND THE TENANT AS
FOLLOWS:
7.01 Parking
-------
Tenant parking is available within the Building and shall be
negotiated separately by the Tenant with the Landlord and shall be available
only on such terms and conditions as are agreed to in writing between the Tenant
and the Landlord.
7.02 Tenant's Improvements
---------------------
The Tenant covenants and agrees that it will not install or construct
any partitions, fixtures, floor coverings, light fixtures, heavy equipment,
safes or machinery upon the Demised Premises, nor undertake or permit any
removal, change, alteration or addition therein or thereto, nor affix or attach
any article thereto without the prior written consent of the Landlord, which
consent shall not be unreasonably withheld. On termination of this lease, the
Tenant shall be entitled to remove any office machines and equipment and
furniture installed by it, making good any damage occasioned to the Demised
Premises by reason of such installation and removal. Further, the Tenant
covenants and agrees that, on termination of this lease, it will, at the request
of the Landlord, remove any or all partitions, fixtures, floor coverings, light
fixtures, office machines and equipment, and furniture installed by the Tenant
and make good any damage
16
occasioned to the Demised Premises by reason of such installation, construction
and removal.
Any removal of equipment, fixtures, partitions and the like which is
undertaken pursuant to this clause, and the restoration of the Demised Premises
to good order and condition, shall be completed prior to the expiry of the
term.
The Tenant shall not remove any trade fixtures, goods or chattels or
any kind from the Demised Premises until all rent and other monies due by the
Tenant to the Landlord are paid.
7.03 Destruction or Damage
---------------------
If during the term hereof the Building shall be damaged by fire,
lightning, tempest, impact of aircraft, acts of God or the Queens' enemies,
riots, insurrections, explosions or other casualty, the following provisions
shall have effect:
(a) If the Demised Premises are rendered partially unfit for occupancy by
the Tenant and remain so for at least Ten (10) days, then the Minimum Rent shall
▇▇▇▇▇ from the date of the damage in part only in the proportion that the part
of the Demised Premises so rendered unfit is of the whole of the Demised
Premises until the Demised Premises have been repaired or restored;
(b) If the Demised Premises are rendered wholly unfit for occupancy by the
Tenant and remain so for at least Ten (10) days, then the Minimum Rent shall be
suspended from the date of the damage until the Demised Premises have been
repaired or restored;
(c) Notwithstanding the provisions of sub-clause (a) and (b) hereof, if
the Demised Premises or Building shall be incapable of being repaid or restored
with reasonable diligence within One Hundred Eighty (180) days of the happening
of the damage, then either the Landlord or the Tenant may, at its option,
terminate this lease by notice in writing to the other given within Sixty (60)
days of the date of the damage, and if such notice is given, this lease shall
cease and become null and void from the date of the damage, and the Tenant shall
immediately surrender the Demised Premises and all of its interest therein to
the Landlord, and the Minimum Rent and Additional Rent shall be apportioned and
shall be payable by the Tenant only to the date of such damage or the date the
Tenant ceases to occupy the Demised Premises, whichever last occurs, and the
Landlord may renter and repossess the Demised Premises, but if within the said
period of Sixty (60) days neither the Tenant nor the Landlord shall give notice
terminating this lease as aforesaid, or if within the said period the Landlord
and Tenant shall agree not to give such notice, then upon the expiration of the
said period of Sixty (60) days or upon the Landlord and Tenant agreeing as
aforesaid, whichever shall be the sooner, the Landlord shall begin to repair and
restore the Demised Premises;
(d) The Landlord shall determine within Thirty-Five (35) days whether or
not the Demised Premises are capable, with reasonable diligence, of being
repaired or restored within the One Hundred Eighty (180) day period as
aforementioned, and the Landlord shall be entitled to rely upon the opinion of a
professional independent architect licensed to carry on business in the Province
of Alberta in making such determination; and
(e) If the Demised Premises are capable with reasonable diligence of being
repaired or restored within One Hundred Eighty (180) days of the happening of
such damage, then the Landlord shall restore or repair the Demised Premises.
It is expressly understood and agreed that the obligation of the
Landlord to rebuild and restore the Demised Premises shall not extend to or be
deemed to include the rebuilding and restoration of any alterations, partitions,
equipment or installations made by the Tenant to the Demised Premises.
7.04 Default
-------
That in the event default is made in payment of rent, or any part
thereof, and such default continues for Seven (7) days after notice of such
non-payment has been delivered to the Tenant, or in the case of non-performance
or non-observance on the part of the Tenant of any covenant, condition,
restriction or stipulation herein contained, expressed or implied, which ought
to be observed or performed by the Tenant, and which has not been expressly
waived in writing by the Landlord, and such non-performance or non-observance
continues for Seven (7) days after notice of such default has been delivered to
the Tenant, then the Landlord may at its option in addition to exercising any
other remedy available to it in law, remedy and defect or default by the Tenant
and charge to the Tenant as Additional Rent such cost and/or cancel this lease
by written notice to the Tenant and, in any one or more of such cases, all
rights and interest hereby created or then existing in favour of the Tenant or
derived under this lease, shall thereupon cease and determine, and the
17
Landlord may re-enter into and upon the Demised Premises and to repossess and
enjoy the same of its former estate, anything herein to the contrary
notwithstanding, or the Landlord may re-let the Demised Premises as agent for
the Tenant; PROVIDED, HOWEVER, that in case of such cancellation and re-entry,
the Tenant shall continue to be liable to pay and the Landlord shall have the
same remedy for the recovery of any rent then due or accruing due as if this
lease had not been cancelled, together with interest at the rate of Eighteen
percent (18%) per annum on any overdue rent, but remained in full force and
effect, and further, that any right of action of the Landlord against the Tenant
in respect of any antecedent breach of any of the said covenants, conditions,
restrictions and stipulations shall not thereby be prejudiced; PROVIDED FURTHER,
the Landlord reserves any and all legal remedies and rights of action for
damages against the Tenant for breach of the lease.
7.05 Bankruptcy or Seizure
---------------------
In the event that the Demised Premises shall, without the prior
written consent of the Landlord, remain vacant or not used for a period of
Fifteen (15) days, or the Demised Premises shall not be occupied by the Tenant
within Fifteen (15) days of the Commencement Date or shall be used by any person
other than the Tenant or for any other purpose than that for which the same were
let, or in case the term or any of the goods and chattels of the Tenant shall be
at any time seized in execution or attachment by any creditor of the Tenant or
the Tenant shall make any assignment for the benefit of creditors or any bulk
sale or become bankrupt or insolvent or take the benefit of any act now or
hereafter in force for bankrupt or insolvent debtors or any order shall be made
for the winding up of the Tenant, then in any such case, this lease shall, at
the option of the Landlord, cease and determine and the term shall immediately
become forfeited and void and the ten current month's rent and the next ensuring
Three (3) month's rent shall immediately become due and payable, and the Lessor
may re-enter and take possession of the Demised Premises as though the Tenant or
other occupant of the Demised Premises was holding over after the expiration of
the term without any right whatsoever.
7.06 Force Majeure
-------------
Save and except for the obligations of the Tenant as set forth in this
lease to pay Minimum Rent, Additional Rent, increased rent or other monies to
the Landlord, if either party shall fail to meet its obligations hereunder
within the time prescribed, and such failure shall be caused or materially
contributed to by force majeure (and for the purpose of this lease, force
majeure shall mean any acts of God, strikes, lockouts, or other industrial
disturbances, acts of the Queen's enemies, sabotage, war, blockades,
insurrections, riots, epidemics, lightning, earthquakes, floods, storms, fires,
washouts, nuclear and radiation activity or fallout, arrests and restrains of
rules and people, civil disturbances, explosions, breakage of or accident to
machinery or stoppage thereof for necessary maintenance or repairs, inability to
obtain labour, materials or equipment, any legislative, administrative or
judicial action which has been resisted in good faith by all reasonable legal
means, any act, omission or event, whether of the kind herein enumerated or
otherwise, not within the control of such party, and which by the exercise of
due diligence such party could not have prevented, but lack of funds on the part
of such party shall be deemed not to be a force majeure), such failure shall be
deemed not to be a breach of the obligations of such party hereunder, but such
party shall use diligence to put itself in a position to carry out its
obligations hereunder.
7.07 Representations
---------------
The Tenant hereby acknowledges that the Demised Premises are taken
without representation of any kind on the part of the Landlord or its agent
other than as set forth herein. No representative or agent of the Landlord or
Tenant is or shall be authorized or permitted to make any representation with
reference thereto, or to vary or modify this Lease in any way, and this Lease
contains all the agreements and conditions made between the parties hereto, and
any addition to or alteration of or changes in this Lease, or other agreement
hereafter made or condition created to be binding, must be made in writing and
signed by both parties.
7.08 Reservation to Landlord
-----------------------
All outside walls of the Demised Premises and any space in the Demised
Premises used for stairways and passageways to other adjoining premises, shafts,
stacks, pipes, conducts, ducts or other building facilities, heating,
electrical, plumbing, air-conditioning and other building systems, and the use
thereof, as well as access thereto through the Demised Premises for the purpose
of use, operation, maintenance and repair are expressly reserved to the
Landlord.
18
7.09 Assignment by Landlord
----------------------
In the event of the sale by the Landlord of the Development, or any
part thereof, or the assignment by the Landlord of this Lease or any interest of
the Landlord hereunder, and to the extent that such purchaser or assignee
assumes the covenants and obligations of the Landlord hereunder, the Landlord
shall, thereupon and without further agreement, be freed and relieved of all
liability with respect to such covenants and obligations.
7.10 Net Lease
---------
The Tenant acknowledges and agrees that this Lease is a completely
carefree net Lease to the Landlord, except as expressly herein set out, that the
Landlord is not responsible during the term for any costs, charges, expenses and
outlays of any nature whatsoever arising from or relating to the Demised
Premises, or the use and occupancy thereof, or the contents thereof or the
business carried on therein, and the Tenant shall pay all charges, impositions,
costs and expenses of every nature and king relating to the Demised Premises, or
the use and occupancy thereof, or the contents thereof or the business carried
on therein, and the Tenant shall pay all charges, impositions, costs and
expenses of every nature and kind relating to the Demised Premises, except as
expressly herein set out.
7.11 Notices
-------
Any notice herein provided or permitted to be given by the Tenant to
the Landlord shall be sufficiently given if delivered or if mailed, by
registered mail, postage prepaid, in writing and addressed to the Landlord at:
PHOENIX PLACE LTD.
c/o Colliers Property Management
3700 Bankers Hall
▇▇▇ - ▇/▇▇/ ▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Any notice herein provided or permitted to be given by the Landlord to
the Tenant shall be sufficiently given if delivered or if mailed, by registered
mail, postage prepaid, in writing and addressed to the Tenant at:
PINNACLE OIL INTERNATIONAL INC.
#▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ - ▇/▇▇/ ▇▇▇▇▇▇ ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
10
Notice mailed as aforesaid shall be conclusively deemed to have been
received on the third business day following the day on which such notice is
mailed. Notice delivered as aforesaid shall be conclusively deemed to have been
delivered if required to be made under the Rules of the Court of Queen's Bench
of Alberta. Either party may, at any time, give notice in writing in the manner
hereinbefore provided to the other of any change of address of the party giving
such notice, and from and after giving of such notice, the address therein
specified shall be deemed to be the address of such party for the giving of
notice hereunder. The word "notice" in this clause shall be deemed to include
any request, statement or other writing in this Lease provided or permitted to
be given by the Landlord to the Tenant or by the Tenant to the Landlord.
7.12 Landlord Not Unreasonably Interfere
-----------------------------------
Except as expressly provided otherwise in this Lease, there shall be
no allowance to the Tenant by way of diminution of rent or otherwise and no
liability on the part of the Landlord by reason of inconvenience, annoyance or
injury to business arising from the happening of the event which gives rise to
the need for any repairs, alterations, additions or improvements or from the
making of any repairs, alterations, additions or improvements in or to any
portion of the Building or the Demised Premises or in and to the fixtures,
appurtenances and equipment thereof. The Landlord agrees to use its best efforts
to do any work done by it in such manner as not to unreasonably interfere with
or impair the Tenant's use of the Demised Premises.
7.13 Headings
--------
The parties hereto agree that the headings herein form no part of this
Lease and shall be deemed to have been inserted for convenience of reference
only.
7.14 Interpretation
--------------
The terms "Landlord" and "Tenant" and the pronouns relating thereto,
where used herein, shall, where the context makes it appropriate, include the
heirs, executors, administrators, successors and assigns of the parties hereto
and shall include the feminine and plural and a body corporate where the context
or the party or parties hereto so require and where there is more than one
Tenant, all covenants shall be deemed joint and several.
7.15 Governing Law
-------------
This Lease and the rules and regulations adopted hereunder, and the
use and occupation of the Demised Premises by the Tenant under this Lease, shall
all be governed by the laws of the Province of Alberta. Should any provision of
this Lease and/or of its conditions be illegal or not enforceable under the laws
of the Province of Alberta, it or they shall be considered severable, then this
Lease and its conditions shall remain in full force and be binding upon the
parties as though such unenforceable provision or provisions had never been
included.
7.16 Overholding
-----------
Upon expiration or other termination of the term of this Lease, the
Tenant shall quit and surrender the Demised in good order and condition,
ordinary wear and tear excepted and shall remove all its property therefrom,
except as otherwise provided in this Lease. If the Tenant shall continue to
occupy the Demised Premises after the expiration of the term without any further
written agreement, or in the absence of such an agreement, without any further
written agreement, or in the absence of such an agreement, without objection by
the Landlord, the Tenant shall be a monthly tenant at the rate and on the terms
herein contained, except as to length of tenancy.
7.17 Time of the Essence
-------------------
Time is of the essence of this Lease.
7.18 Enurement
---------
This Lease and the terms and provision hereof shall enure to the
benefit of and be binding upon the parties hereto and their respective permitted
successors, assigns and personal representatives and executors.
20
7.19 Acceptance
----------
hereby accepts this Lease of the Demised Premises to be held by him as
Tenant, and subject to the conditions, restrictions and covenants above set
forth.
IN WITNESS WHEREOF, the parties hereto have executed this Lease as of
the day and year first above written.
PHOENIX PLACE LTD.
LANDLORD
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ [SIGNATURE ILLEGIBLE]
------------------------------- -----------------------------------
WITNESS
PINNACLE OIL INTERNATIONAL INC.
TENANT
[SIGNATURE ILLEGIBLE] [SIGNATURE ILLEGIBLE]
------------------------------- -----------------------------------
WITNESS PRESIDENT
21
SCHEDULE "A"
LEGAL DESCRIPTION
-----------------
Plan A1 Calgary
Block Thirty Four (34)
Lots Twenty Nine (29) to Thirty Four (34) inclusive
22
SCHEDULE "B"
DEMISED PREMISES
----------------
[FLOOR PLAN OF SUNIC INVESTMENTS INC. APPEARS HERE]
▇▇▇
▇▇▇ ▇▇▇▇▇ SUNIC INVESTMENTS INC. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇
SCHEDULE "C"
RULES AND REGULATIONS
---------------------
1. The definitions set forth in the lease have the same meaning in these rules
and regulations.
2. No cooking or preparation of food or beverages shall be permitted in the
Demised Premises, and no electrical apparatus likely to cause an
overloading of electrical circuits will be used therein.
3. The sidewalks, entries, passages, elevators and staircases in the Building
shall not be obstructed or used by the Tenant, its agents, servants,
contractors, invitees or employees for any purpose other than ingress to
and egress from the offices. The Landlord reserves unrestricted control of
all parts of the Building employed for the common benefit of the tenants,
including without limitation, the sidewalks, entries, corridors and
passages not within the Demised Premises, washrooms, lavatories,
airconditioning closets, fan rooms, janitor's rooms electrical rooms and
other rooms, stairs, elevator shafts, flucs, stacks, pipe shafts and ducts
and shall have the right to place such signs and appliances therein, as it
may deem advisable, provided that ingress and egress from the Demised
Premises is not unduly impaired thereby.
4. The Tenant, its agents, servants, contractors, invitees or employees, shall
not bring in or take out, position, construct, install or move any safe,
business machine or other heavy office equipment without the prior written
consent of the Landlord who shall have the absolute right to withhold
consent or to prescribe the maximum weight permitted and the position
thereof, and the use and design of the planks, skids, or platforms to
distribute the weight of such equipment. All damage done to the Building by
the moving or use of any such heavy equipment or other office equipment or
furniture shall be repaired at the expense of the Tenant. The moving of all
heavy equipment or other office equipment shall occur only between 6:00
p.m. and 8:00 a.m. or other time consented to by the Landlord, and the
persons employed to move the same in and out of the Building must be
acceptable to the Landlord. Safes and other heavy office equipment will be
moved through the halls and corridors only upon steel bearing plates. No
deliveries requiring the use of an elevator for freight purposes will be
received in the Building or carried in the elevators, except during hours
approved by the Landlord.
5. All persons entering and leaving the Building at any time other than during
normal business hours shall register in the books kept by the Landlord at
or near the night entrance and the Landlord will have the right to prevent
any person from entering or leaving the Building unless provided with a key
to the premises to which such person seeks entrance or a pass in a form to
be approved by the Landlord. Any persons found in the Building at such
times without such keys or passes will be subject to surveillance or
eviction by the employees and agents of the Landlord without recourse. The
Landlord shall be under no responsibility for failure to enforce this rule.
6. The Tenant shall not place or cause to be placed any additional or
substitute locks upon any doors of the Demised Premises without the
approval of the Landlord and subject to any conditions imposed by the
Landlord. Additional keys may be obtained from the Landlord at cost of the
Tenant.
7. The water sinks, basins, urinals, toilets, sewers, and other water
apparatus shall not be used for any purpose other than those for which they
were constructed, and no sweepings, rubbish, rags, ashes or other
substances shall be thrown therein. Any damage resulting from misuse shall
be borne by the Tenant by whom or by whose agents, servants, employees,
licensees or invitees the same is caused. Tenants shall not let the water
run unless it is in actual use and shall not deface or ▇▇▇▇ any part of the
Building or drive nails, spikes, hooks or screws into the walls or woodwork
of the Building.
8. No one shall use the Demised Premises for sleeping apartments or
residential purposes, or for the storage or personal effects or articles
other than those required for business purposes.
9. Canvassing, soliciting and peddling in the Building are prohibited.
10. Any hand trucks, carryalls or similar appliances used in the Building shall
be equipped with rubber tires, side guards and such other safeguards as the
Landlord shall require.
24
11. No animals or birds shall be brought into the Building.
12. The Tenant shall not install or permit the installation or use of any
machine dispensing goods for sale in the Demised Premises or the Building
or permit the delivery of any food or beverage to the Demises
Premises without the approval of the Landlord or in contravention of any
regulation fixed or to be fixed by the Landlord. Only persons authorized by
the Landlord shall be permitted to deliver or to use the elevators in the
Building for the purpose of delivering food or other beverages to the
Demised Premises.
25
SCHEDULE "D"
LANDLORD AND TENANT WORK
------------------------
1. Leasehold Improvements to Premises - By Landlord
------------------------------------------------
a) The Landlord will co-ordinate the design, supervision, and
construction of the leasehold improvements to level consistent with
the show suite on the 14/th/ floor of the building (all of which is
herein called the "Improvements") to the Premises.
b) The Landlord will contribute a maximum of $20.00 per rentable square
foot of the Premises toward the improvements including design fees and
permits (the estimated total Landlord contribution being $116,000.00).
c) If the Landlord's full contribution is not required to complete the
Improvements, the saving will accrue to the Tenant and applied to the
initial months of minimum rent due under the Lease.
d) If the total cost of the Improvements exceeds the Landlord's maximum
contribution, the Tenant will be obliged to pay the excess directly to
the contractor(s) in a timely manner.
e) The Landlord will carry out the Improvements in accordance with the
design plan and specifications and in accordance with the lawful
requirements of all Government Bodies having jurisdiction.
The Landlord will not be obliged to commence the Improvements, except for
any preliminary layout design which the Landlord has authorized in writing,
until the Lease has been fully and unconditionally executed and delivered
by all parties.
2. Common Lobby Upgrades
---------------------
In addition the Landlord agrees to upgrade the common area lobby and
washrooms on this floor to a level of quality and finishes as provided on
the 14/th/ floor of the Building.
3. Tenant Improvements
-------------------
The Tenant shall be responsible for the installation of any leasehold
improvements in the Leased Premises which are over and above the Landlord's
Improvements and Common Area Upgrades (the "Tenant Improvements").
26
SCHEDULE "E"
SPECIAL PROVISIONS
------------------
1. RIGHT OF FIRST REFUSAL
----------------------
The Tenant shall have the Right of First Refusal to match any bona fide
third party Offer to Lease on contiguous premises on the 7/th/ floor which
becomes vacant during the term of this Lease with two (2) business days
notice of being presented with same by the Landlord.
2. OPTION TO RENEW
---------------
Provided the Tenant has during the Term of this Lease paid the Rent at the
time and in the manner therein required to be paid and has otherwise
performed the obligations and covenants on its part to be performed, then
the Landlord shall grant to the Tenant the option to renew this Lease and
the Parking Agreement for a further term of five (5) years (hereinafter
referred to as the "Renewal Period") with the commencement date being the
day following the expiration of the initial Term.
Provided, in order to exercise its option for the Renewal Period, the
Tenant shall be required to give to the Landlord notice thereof in writing
not less than six (6) months before the date of the expiry of the Term of
this Lease. Any renewal pursuant to this proviso shall be on the terms and
conditions in the Landlord's then current standard office lease for the
Building except that:
a. there shall be no additional right of renewal;
b. the Minimum Rent payable by the Tenant during the Renewal Period
(hereinafter referred to as the "New Minimum Rent") shall be equal to
the current market rent at the expiration of the Term for comparable
space in the Building or if there is no such comparable space, for
comparable space in buildings or office complexes similar in quality
and location to the Building with such New Minimum Rent to be agreed
upon between the Landlord and the Tenant.
If any dispute arises as to the amount of the New Minimum Rent the issue
shall be resolved by Arbitration in accordance the Arbitration Act of
Alberta.
27
PARKING
-------
PARKING AGREEMENT
-----------------
THIS INDENTURE made in duplicate the 25/th/ day of November, 1997.
BETWEEN:
PHOENIX PLACE LTD, a body
corporate having an office
in the City of Calgary,
in the Province of Alberta
(hereinafter called "the Licensor")
AND:
PINNACLE OIL INTERNATIONAL INC.
#▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ - ▇/▇▇/ ▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
(hereinafter called "the Licensee")
WHEREAS the Landlord has available for lease parking stalls in the
underground heated parking facility (the "Parkade") in the building complex
municipally located at ▇▇▇ - ▇/▇▇/ ▇▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ (the "Building").
AND WHEREAS the Landlord has agreed to allow the Tenant the use of certain
of these parking stalls subject to the terms and conditions of this Agreement;
NOW THEREFORE THIS AGREEMENT WITNESSETH that in consideration of the
covenants herein, the parties agree as follows:
1. The Landlord will, during the term of this Agreement, provided three (3)
parking stall(s) in the Parkade for the use of persons designated by the Tenant
("Designated Users").
2. a) The term of the Agreement will commence on February 1998 and expire
January 31, 2003. The Tenant will pay a monthly fee on the first day of each
month during the term hereof, which sum has been calculated on the basis of a
rate of One Hundred and Forty Dollars and Zero Cents ($140.00) per month per
parking stall. Such rental shall be payable to the Landlord at:
PHOENIX PLACE LTD.
c/o Colliers Property Management
3700 Bankers Hall
▇▇▇ - ▇/▇▇/ ▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇ ▇▇▇
or at such other address as the Tenant may hereafter be advised in writing by
the Landlord from time to time.
The monthly fee will be subject to increase from time to time upon 30 days
written notice from the Landlord based upon prevailing market rents for
comparable parking stalls in similar locations in downtown Calgary.
3. The Tenant and the Designated Users of the parking stall(s) shall observe
and obey all regulations or instructions which may from time to time be
established for the proper operation of the parkade by the Landlord, or any
manager, or managers, which may be appointed by it (the "Parkade Operator"), and
such regulations and instructions shall be deemed to form a part of this
Agreement.
28
4. The Tenant shall register with the Landlord the names of the Designated
Users using the Parkade together with the names and license plate numbers of all
vehicles to be parked therein. The parking stalls shall only be used for
passenger motor vehicles permitted by fire regulations to park in underground
parkades. No substitute vehicles may park in the Parkade without the prior
written approval of the Landlord.
5. The Landlord and the Parkade Operator shall not be liable for any loss or
damage, however caused, to any vehicle or its contents while in the Parkade,
even if such loss or damage results from the negligence of the Landlord or the
Parkade Operator, or their respective servants, agents or employees, and the
Tenant shall indemnify and hold harmless with respect to any such loss or
damage, the Landlord, any Parkade Operator and their respective servants, agents
and employees together with their successors and assigns.
6. The Tenant hereby acknowledges receipt of Three (3) parking access card(s)
which permits vehicular access to the Parkade. Loss of parking access cards must
immediately be reported to the Landlord and replacement parking access cards
may be obtained at an additional charge then prevailing, which at the
commencement date of this License Agreement is TWENTY FIVE DOLLARS ($25.00) per
parking access card.
7. Insurance for loss of or damage to vehicles using the parking stall
pursuant to this Agreement shall be the responsibility of the Tenant or its
Designated User. The Tenant shall ensure that any insurance held by it or any of
its Designated Users for vehicles which are parked in the parkade by virtue of
this Agreement contains a waiver of subrogation against the Landlord, the
landlord any Parkade Operator and their respective servants, agents and
employees, in respect of any loss of or damage to the vehicle.
8. Insurance for loss of or damage to vehicles using the parking stall
pursuant to this Agreement shall be the responsibility of the Tenant or its
Designated User. The Tenant shall ensure that any insurance held by it or any of
its Designated Users for vehicles which are parked in the parkade by virtue of
this Agreement contains a waiver or subrogation against the Landlord, the
Landlord any Parkade Operator and their respective servants, agents and
employees, in respect of any loss or damage to the vehicle.
9. The Tenant and its Designated Users using the Parkade shall not create any
nuisance or hazard within the Parkade nor use the Parkade in any matter
detrimental to the use of the Parkade by other persons.
10. The Tenant and its Designated Users shall not park in driving lanes or in
any other area not designated as a parking stall.
11. The Tenant shall ensure that its Designated Users are familiar with and
comply with all of the terms of this Agreement including all of the regulations
and instructions referred to in paragraph 3 hereof. Vehicles parked in breach of
any of the terms of this Agreement or regulations and instructions referred to
in paragraph 3 may be ticketed, removed from the parkade and impounded at the
cost and expense of the Tenant and the Designated Users.
12. If the Tenant or any of its Designated Users are in breach or default of
any of the terms of this Agreement or any regulations or instructions made
pursuant to paragraph 3, and such breach or default is not cured within two (2)
business days notice of such breach or default to the Tenant, then, the Landlord
may terminate this Agreement forthwith upon written notice to the Tenant.
13. In the event of damage to the Parkade, or Building resulting in the closure
of the Parkade, the Landlord's obligations hereunder shall be suspended during
such period and the monthly fee shall ▇▇▇▇▇ for the period of the closure.
14. This Agreement and the license herein granted shall not be assigned by the
Tenant except with the prior written approval of the Landlord. An assignment or
transfer, or surrender of the Landlord's leasehold estate shall be deemed not to
be a termination of the Landlord's leasehold estate provided that such
assignment, transfer or surrender is made subject to the assumption by the
assignee or transferee of the obligations of the Landlord hereunder and in such
event the Tenant agrees to execute a notation agreement providing for a release
of the Landlord from its obligations hereunder and an assumption of those
obligations by the assignee, transferee or person to whom the surrender is made.
29
IN WITNESS WHEREOF the parties have executed this Agreement as of the day
and year first above written.
PHOENIX PLACE LTD.
Licensor
[SIGNATURE ILLEGIBLE]
-------------------------------------
PINNACLE OIL INTERNATIONAL INC.
Licensee
[SIGNATURE ILLEGIBLE]
-------------------------------------
PRESIDENT
[SIGNATURE ILLEGIBLE]
------------------------------- _____________________________
Witness
30