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EXHIBIT 10.09
THIS LEASE is dated the 20th day of January, 2000.
[OFFICE LEASE]
LEASE
B E T W E E N:
235 INVESTMENTS LIMITED
[Landlord]
- and -
XXXXXX.XXX, INC.
[Tenant]
Floor: 11TH
Suite: 1102
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THIS LEASE is dated the 20th day of January, 2000.
B E T W E E N:
235 INVESTMENTS LIMITED
("Landlord")
OF THE FIRST PART;
- and -
XXXXXX.XXX, INC.
("Tenant")
OF THE SECOND PART;
BASIC TERMS
The following are certain basic terms, which are part of, and are
referred to in subsequent provisions of this Lease. Any conflict or
inconsistency between these basic terms and the provisions contained elsewhere
in this Lease will be resolved in favour of the provisions contained elsewhere
in the Lease:
(a) Leased Premises (Section 1.3)
(i) Rentable Area: 6,297 square feet
(ii) Floor: 11th
(iii) Suite No.: 1102
The approximate location of the Leased Premises is outlined in red on
the floor plan attached as Schedule "B".
(b) Term (Section 1.1)
The period commencing on the date (the "Commencement Date") which is
the 1st day of MARCH, 2000; and expiring FOUR (4) years after the Commencement
Date being FEBRUARY 29, 2004 (or the last day of the calendar month in which the
Commencement Date occurs, if the Commencement Date is not the first day of a
calendar month).
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(c) Use (Section 6.1)
The Leased Premises are to be utilized for computer website development
and administration office.
(d) Basic Rent (Section 3.2)
An annual rate per square foot of the Rentable Area of the Leased
Premises as follows:
Period Rate
March 1, 2000 to February 29, 2004 $7.50 per square foot
(e) Advance Rent (Section 3.3)
Twenty Thousand Forty Four Dollars and Four Cents ($20,044.04).
(f) Security Deposit (Section 12.6)
(g) Letter of Credit (Section 13.13)
(h) Address of Landlord (Section 13.9)
0 Xxxxxxx Xxxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxx
X0X 0X0
(i) Address of Tenant (Section 13.9)
000 Xxxxxxxx Xxxxxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxx
X0X 0X0
(j) Name and Address of Indemnifier (Appendix "A")
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ARTICLE 1
Term, Additional Areas and Leased Premises
Section 1.1 Grant and Term. The Landlord leases to the Tenant, and the
Tenant leases from the Landlord, the Leased Premises, to have and to hold for
the Term and upon the terms and conditions and subject to the limitations set
out in this Lease.
Section 1.2 Use of Additional Areas. The Tenant's use of the Leased
Premises includes the non-exclusive right of the Tenant and persons having
business with the Tenant in common with the Landlord and all others entitled, to
the use of the Common Areas and Facilities, subject to the terms of this Lease.
Section 1.3 Leased Premises. As soon as reasonably possible after the
Commencement Date and, if applicable, after any relocation, rearrangement,
alteration, addition or reduction of or to the Leased Premises in accordance
with this Lease, the Architect shall calculate the actual Usable Area and
Rentable Area of the Leased Premises in accordance with Schedule "D".
ARTICLE 2
Construction and Fixturing
Section 2.1 Construction of the Leased Premises. The Landlord will, at
its expense, complete the work designated as "Landlord's Work" in accordance
with the provisions of Schedule "C" and the Tenant will, at its expense and
within the time period set out herein, complete the work designated as "Tenant's
Work" in Schedule "C". The Tenant acknowledges that minor modifications or
alterations may be made by the Landlord to the Leased Premises from that shown
on Schedule "B" during the completion of the Landlord's Work.
The Tenant will examine the Leased Premises before taking possession
and unless the Tenant serves the Landlord with written notice specifying any
deficiencies or defects within ten (10) days after taking possession, the Tenant
will be deemed to have examined the Leased Premises and to have agreed that they
are in good order and that the Landlord's Work has been satisfactorily
completed.
Section 2.2 Construction Delays. The Tenant acknowledges that if there
is a delay which results in the Landlord's Work not being completed on schedule,
the Tenant shall and does hereby release the Landlord from all costs, expenses,
claims, losses or damages suffered or incurred as a result of such delay whether
or not caused, or to the extent contributed to, by the acts, omissions or
negligence of the Landlord or those for whom it is at law responsible.
Section 2.3 Architect. If there is a dispute as to (i) completion of
the Landlord's Work or the Tenant's Work, or (ii) the availability of the Leased
Premises for possession by the Tenant, or (iii) the Rentable or Usable Area of
the Leased Premises, the opinion of the Architect will be final and binding.
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ARTICLE 3
Rent
Section 3.1 Covenant to Pay. The Tenant will pay Basic Rent and
Additional Rent without any set-off, deduction, abatement or demand. All Rent
will be paid by the Tenant to the Landlord at the Landlord's address set out in
Paragraph (h) of the Basic Terms and will be payable in lawful Canadian money.
Section 3.2 Basic Rent.
(a) The Tenant will, from and after the Commencement Date and
thereafter throughout the Term, pay to the Landlord as Basic Rent, in equal
consecutive monthly installments in advance on the first day of each calendar
month of each Lease Year, an annual sum based upon the annual rate specified in
Paragraph (d) of the Basic Terms.
(b) Whenever the Usable Area and the Rentable Area of the
Leased Premises are calculated by the Architect pursuant to Section 1.3, the
Basic Rent and Additional Rent shall be adjusted retroactively to the
Commencement Date.
(c) The Tenant shall deliver to the Landlord at the beginning
of each Lease Year or at any other time during the Term if requested by the
Landlord, one or more series of monthly post-dated cheques for such Rent as is
payable by equal monthly installments under this Lease and such Lease Year or
other period as is requested by the Landlord.
(d) At the Landlord's request, in lieu of the post-dated
cheques referred to in Section 3.2(c), the Tenant will participate in a
pre-authorized payment plan whereby the Landlord will be authorized to debit the
Tenant's bank account each month or from time to time for such Rent as is
payable by equal monthly installments under this Lease. Within five (5) days
after such presentation by the Landlord, the Tenant will sign a form of
application to the Tenant's bank, on the Landlord's standard form, to give
effect to the foregoing.
Section 3.3 Advance Rent. The sum specified in Paragraph (e) of the
Basic Terms as Advance Rent shall be held by the Landlord without interest by
the Landlord and applied on account of the Basic Rent first falling due and
payable under this Lease.
Section 3.4 Rent Past Due. If the Tenant fails to pay any Rent when due
then, in addition to all other rights and remedies available to the Landlord,
the unpaid amounts shall, upon demand from the Landlord, bear interest from the
due date to the date of payment of an annual rate of four (4) percentage points
above the Prime Rate, calculated and compounded monthly.
ARTICLE 4
Taxes, Operating Costs and Utilities
Section 4.1 Taxes Payable by Landlord. The Landlord will, subject to
Sections 4.2, 4.3 and 4.4 pay all Taxes directly to the taxing authority. The
Landlord may, nevertheless, defer payment of Taxes to the fullest extent
permitted by law, so long as it diligently prosecutes any contest or appeal of
Taxes.
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Section 4.2 Taxes Payable by Tenant.
(a) If there are separate real property tax bills and separate
real property assessment notices for the Leased Premises and the non-leasable
areas of the Building and the Lands, subject to Section 4.2(b), the Tenant shall
(i) pay to the Landlord or to the taxing authorities if the Landlord so directs,
and discharge during the Term and within the times provided for by the taxing
authorities, all Taxes that are levied, rated, charged or assessed from time to
time, respectively, against the Leased Premises or any part thereof, on the
basis of a separate real property tax xxxx and separate assessment notice
rendered by any lawful taxing authority; (ii) within ten (10) days after receipt
of such separate real property tax xxxx and separate assessment notice, provide
a copy thereof to the Landlord; (iii) promptly deliver to the Landlord receipts
evidencing the payment of all such Taxes and such other information in
connection therewith as the Landlord reasonably requires; and (iv) pay in
accordance with Section 4.5, its Proportionate Share of all Taxes levied, rated,
charged or assessed against the Building and the Lands including, without
limitation, the Tenant's portion (as determined by the Landlord) of such Taxes
levied or assessed against the Common Areas and Facilities but excluding all
portions thereof designated or intended by the Landlord to be leased to tenants.
(b) If there are not separate real property tax bills and
separate real property assessment notices for the Leased Premises and the
non-leasable areas of the Property or, in any event, if the Landlord so elects,
the Tenant shall not be required to pay the amounts described in Section 4.2(a)
but shall pay monthly in advance or otherwise as the Landlord directs, in
accordance with Section 4.5, its Proportionate Share of all Taxes allocated by
the Landlord to the Property, including the Common Areas and Facilities but
excluding any Taxes allocated by the Landlord to the Storage Areas which arc
recovered from tenants in the Building pursuant to clauses in their respective
leases requiring such contribution.
(c) If the Landlord determines that as a result of the
construction or installation of any Leasehold Improvements or Fixtures in the
Leased Premises or the use of the Leased Premises or the particular location of
the Leased Premises within the Building, the Tenant's Proportionate Share of
Taxes payable in accordance with Section 4.2(b) does not accurately reflect the
proper share of the Taxes which should in the Landlord's opinion be payable by
the Tenant, the Landlord may increase or decrease the Tenant's Proportionate
Share of Taxes and the Tenant will pay such adjusted amount rather than the
Tenant's Proportionate Share as set out in Section 4.2(b).
(d) If the Tenant elects to have the Leased Premises or any
part thereof assessed for separate school taxes, the Tenant shall pay to the
Landlord as Additional Rent, as soon as the amount of such separate school taxes
is ascertained, any amount by which the amount of separate school taxes exceeds
the amount which would otherwise have been payable for school taxes had such
election not been made.
Section 4.3 Business Taxes and Other Taxes of the Tenant.
(a) The Tenant will pay to the lawful taxing authorities or to
the Landlord, as the Landlord directs, all Business Taxes imposed in respect of
the Tenant's business and assets in, or use, enjoyment or occupancy of, the
Leased Premises and the Building or any portion
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thereof. The Tenant shall promptly deliver to the Landlord receipts evidencing
payment of all such Business Taxes and such other information in connection
therewith as the Landlord reasonably requires.
(b) The Tenant shall give the Landlord at least fifteen (15)
days' notice of its intention to appeal against the imposition of any Business
Taxes. The Tenant will deliver to the Landlord such security for any increase in
Taxes, Business Taxes or other taxes payable hereunder as the Landlord requires
to ensure payment thereof. The Tenant will indemnify and hold the Landlord
harmless from and against payment of all loss, costs, charges and expenses
occasioned by or arising from all Taxes and Business Taxes payable by the Tenant
and any taxes which may in future be levied in lieu of or in addition to such
amounts or which may be assessed against any rentals payable pursuant to this
Lease in lieu of such amounts, whether against the Landlord or the Tenant,
including, without limitation, any increase in Taxes or Business Taxes arising
directly or indirectly out of any appeal or contestation by the Tenant.
(c) The Tenant will pay to the Landlord (acting as agent for
the taxing authority if applicable) or directly to the taxing authority (if
required by the applicable legislation) in the manner specified by the Landlord,
the full amount of all goods and services taxes, sales taxes, value-added taxes,
multi-stage taxes, business transfer taxes, and any other taxes imposed on the
Tenant in respect of the Rent payable by the Tenant under this Lease, or in
respect of the rental of premises by the Tenant under this Lease (collectively
and individually, "G.S.T."). Sales Taxes so payable by the Tenant will be: (i)
calculated by the Landlord in accordance with the applicable legislation; (ii)
paid by the Tenant at the same time as the amounts to which the Sales Taxes
apply are payable to the Landlord under the terms of this Lease (or upon demand
at such other time or times as the Landlord from time to time determines); and
(iii) considered not to be Rent, despite anything else in this Lease, but the
Landlord will have all of the same remedies for and rights of recovery with
respect to such amounts as it has for non-payment of Rent under this Lease or at
law.
Section 4.4 Tenant's Contribution to Operating Costs. The Tenant will
pay to the Landlord, in accordance with Section 4.5, its Proportionate Share of
Operating Costs. The Tenant acknowledges that Operating Costs may be allocated
by the Landlord to the Office Area, the Retail Area, the Storage Areas and other
components of the Building and that the Landlord may adjust Operating Costs or
the denominator of the Tenant's Proportionate Share fraction in accordance with
current practices relevant to multi-use commercial developments on a basis
consistent with the benefits derived by the tenants of each component of the
Building and having regard to the nature of the particular costs and expenses
being allocated.
Section 4.5 Payment of Taxes and Operating Costs.
(a) The amounts payable by the Tenant under Sections 4.2 and
4.4 (and under Section 4.3, if applicable) may be estimated from time to time by
the Landlord and commencing on the Commencement Date, the Tenant shall pay the
Landlord such estimated amounts in equal consecutive monthly installments in
advance, on the first day of every month. The Landlord may from time to time
revise any of such estimates and in such event the Tenant's monthly payments
will be adjusted accordingly beginning with the first day of the month after the
Landlord notifies the Tenant of the revised estimate and the adjusted monthly
amounts.
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(b) As soon as reasonably practicable after the end of the
period for which the estimated payments have been made, and at the expiry of the
Term, the Landlord will determine and advise the Tenant in writing of the exact
amounts payable by the Tenant under Sections 4.2 and 4.4 (and under Section 4.3,
if applicable). If necessary, an adjustment will be made between the parties
within fifteen (15) days after the Tenant has been advised of the actual
amounts. The Tenant shall have the right to audit the Landlord's records, at the
Tenant sole cost and expense, if a bona fide dispute arises.
Section 4.6 Charges for Utilities.
(a) If there are separate meters (other than check meters) for
any Utilities consumed in the Leased Premises, the Tenant will pay directly to
the suppliers of such Utilities, the charges therefor.
(b) The cost of Utilities, excluding the amounts payable by
the Tenant under Section 4.6(a), shall (A) if there is a meter for Utilities
consumed only by the tenants on the floor on which the Leased Premises is
located, be apportioned by the Landlord, on an equitable basis, amongst the
tenants on the floor; or (B) be included in Operating Costs; except for (i) any
additional charges for the supply of any excess Utilities in the Leased
Premises, which shall be payable by the Tenant pursuant to Section 4.6(c), and
(ii) the cost of Utilities supplied for climate control services after Normal
Business Hours, which shall be payable by the Tenant pursuant to Section
5.2(a)(i).
(c) In addition to but without duplication of the amounts
payable by the Tenant under Section 4.6(a) and (b) and Section 5.2(a)(i), if the
Landlord requires, the Tenant shall pay:
(i) an additional charge for the supply to and usage
of any excess Utilities in the Leased Premises, as reasonably determined by the
Landlord and equally applied;
(ii) all costs incurred by the Landlord in
determining or allocating the additional charge for Utilities including, without
limitation, professional engineering and consulting fees; and
(iii) an administration fee of fifteen percent (15%)
of the costs and charges referred to in subparagraphs (i) and (ii) above.
(d) The Tenant shall pay for the cost of any metering which
the Tenant requests the Landlord to install in the Leased Premises, or which the
Landlord wishes to install in the Building, for the purpose of assisting in
determining the consumption of any Utility in the Leased Premises.
(e) The Landlord shall not be liable for, nor have any
obligation with respect to any interruption, cessation or failure in the supply
of any Utilities, services or systems in, to or serving the Building or the
Leased Premises, whether or not supplied by the Landlord.
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ARTICLE 5
Building - Control and Services
Section 5.1 Control of the Building.
(a) The Landlord will operate and maintain the Building as
would a prudent landlord of a similar office building having regard to size, age
and location.
(b) The Building is at all times subject to the exclusive
control, management and operation of the Landlord. The Landlord has the right
with respect to such control, management and operation to:
(i) obstruct or close off all or any part of the
Property for the purpose of maintenance, repair or construction;
(ii) employ all personnel necessary for the operation
and management of the Building, either directly or through a third party
property management company;
(iii) construct other improvements and make
alterations, additions, subtractions or re-arrangements, build additional
storeys and construct facilities adjoining or proximate to the Building,
including underground tunnels and pedestrian walkways and overpasses, and to
relocate or rearrange the Leased Premises from the location shown on Schedule
"B", or to make alterations, additions or reductions to the Leased Premises. The
Landlord must make the Tenant "whole", move the Tenant to similar premises with
similar finishes and pay for all costs associated with the relocation,
rearrangement, alterations, additions or reductions outlined above.
(iv) do and perform such other acts in and to the
Building, as, in the use of good business judgment, the Landlord determines to
be advisable for the more efficient and proper operation of the Building;
(v) control, supervise and regulate the Parking
Garage in such manner as the Landlord determines time to time, including,
without limitation, imposing charges or rates as may from time to time be
determined by the Landlord for the use of the Parking Garage.
(c) The Landlord is not subject to any liability, nor is the
Tenant entitled to any compensation or abatement of Rent as a result of the
Landlord's exercise of its rights conferred under Section 5.1.
Section 5.2 Landlord's Services.
(a) During the Term, the Landlord shall provide, as required,
the following services and utilities upon the terms and subject to the
conditions set out in Section 5.2(b):
(i) except during the completion of repairs,
alterations or Leasehold Improvements, climate control for the Leased Premises
shall be provided during Normal Business Hours, in order to maintain a
temperature adequate for normal occupancy in accordance with the provisions
hereof. If the Tenant requests the provision of climate control services to the
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Leased Premises outside Normal Business Hours, the Landlord will provide such
services to the Tenant, at the Tenant's expense and at the rate determined by
the Landlord which shall be payable by the Tenant upon demand;
(ii) when reasonably necessary from time to time, the
Landlord shall cause the floors in the Leased Premises to be cleaned or
vacuumed, the windows to be cleaned, the trash to be removed and the desks,
tables and other furniture of the Tenant to be dusted;
(iii) water (if applicable) and electricity in such
quantities as the Landlord, in its sole discretion, determines to be reasonable
in compliance with applicable laws, shall be provided to the Leased Premises. If
the Tenant's equipment requires such Utilities in excess of the quantities
normally supplied by the Landlord to similar premises in the Building and the
Tenant requests the Landlord to supply such excess quantities, facilities to
supply such excess quantities may be provided by the Landlord at the sole
expense of the Tenant, if such excess quantities are available, provided that:
(1) the Landlord may nevertheless refuse to
supply such excess Utilities if the supplying of additional facilities or excess
Utilities may affect the operation or aesthetics of the Building, or Structure,
or in any way reduce the efficiency of existing electricity, water or other
Utilities supplied to the Building; and
(2) the actual cost of supplying such
additional facilities or excess Utilities shall be paid by the Tenant to the
Landlord upon demand and in accordance with Section 4.6, together with the
amounts described in Sections 4.6(c)(ii) and (iii); and
(iv) elevator service shall be provided by the
Landlord during Normal Business Hours, for use by the Tenant in common with
others and subject to the Rules and Regulations and the conditions set out in
Section 5.2(b).
(b) The provision by the Landlord of the services and
utilities referred to in Section 5.2 shall be subject to the following terms and
conditions:
(i) the Landlord shall have no responsibility or
liability for failure to supply climate control services when stopped or
prevented from so doing by strikes or other causes beyond the Landlord's
reasonable control;
(ii) any use of the Leased Premises not in accordance
with the design standards of the Building or any arrangement of partitions which
interferes with the normal operation of the climate control system for the
Building may require changes or alterations in the system or the ducts. Any
changes or alterations so required, if such changes can be accommodated by the
Landlord's equipment, shall be made by the Landlord, at the Tenant's expense,
and only after such changes or alterations have received the Landlord's prior
written consent. If installation of partitions, equipment or fixtures by or on
behalf of the Tenant (other than the partitions installed as part of the
Landlord's Work described in Schedule "C" of this Lease) necessitates the
rebalancing of any climate control equipment serving the Leased Premises, such
work will be performed by the Landlord at the Tenant's expense, together with an
amount equal to fifteen percent (15%) of the total expense thereof, representing
the Landlord's overhead and administrative costs, and shall be payable by the
Tenant upon demand;
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(iii) the Landlord shall use reasonable efforts to
adjust and balance the climate control systems as soon as reasonably possible
after the Commencement Date;
(iv) the Landlord will not be responsible for any
inadequacy in the performance of the climate control system serving the Leased
Premises if (1) the occupancy of the Leased Premises exceeds one (1) person for
every one hundred (100) square feet of the Rentable Area of the Leased Premises,
or (2) the window coverings or exterior windows are not kept fully closed while
the windows are exposed to direct sunlight. If the use of the Leased Premises
does not accord with the aforementioned requirements and changes in the climate
control system are desirable or necessary to accommodate such use, the Landlord
may make such changes at the Tenant's expense, payable as set out in Section
5.2(b)(ii);
(v) temporary interruption of elevator service may be
required during periods when repairs, replacements, alterations or Leasehold
Improvements are being made; and
(vi) the Landlord shall not be liable and the Tenant
agrees to release and hold harmless the Landlord from any claim, loss or damage
resulting from (1) any interruption or disruption of elevator service caused or
contributed to by mechanical failure; (2) any failure by the Landlord to provide
elevator service during any period of power interruption; (3) any cause beyond
the control of the Landlord; or (4) the carrying out of any repairs, maintenance
or replacements of the elevators.
Section 5.3 Tenant's Responsibilities. The Tenant will regulate those
portions of the climate control equipment within and exclusively serving the
Leased Premises so as to maintain such reasonable conditions of temperature and
humidity within the Leased Premises as are determined by the Landlord and its
Architect and engineers so that no direct or indirect appropriation of the
heating, ventilating and air-conditioning from the Common Areas and Facilities
occurs. The Tenant shall comply with such stipulations and with all Rules and
Regulations of the Landlord pertaining to the operation and regulation of such
equipment. If the Tenant falls to comply with such stipulations and the Rules
and Regulations, the Landlord shall be entitled to take such steps as it deems
advisable to correct such defaults (including, without limitation, entering upon
the Leased Premises and assuming control of such equipment) without liability to
the Tenant, and the Tenant will pay to the Landlord, upon demand, all costs and
expenses incurred by the Landlord in so doing, together with an amount equal to
fifteen percent (15%) of such costs and expenses, representing the Landlord's
overhead and administrative costs.
ARTICLE 6
Use of the Leased Premises
Section 6.1 Use of the Leased Premises. The Leased Premises will be
used solely for the purpose described in Paragraph (c) of the Basic Terms and
for no other purpose.
Section 6.2 Conduct of Business.
(a) The Tenant will occupy the Leased Premises and commence
its business operations in the Leased Premises and will thereafter throughout
the Term continuously, actively and diligently conduct its business in the whole
of the Leased Premises in a reputable and first-
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class manner. If the Landlord requests, the Tenant will immediately cease
conducting any business in the Leased Premises which in the Landlord's
reasonable opinion may harm or tend to harm the business or reputation of the
Landlord or reflect unfavourably on the whole or any part of the Property, the
Landlord or other tenants in the Building.
(b) The Tenant will not allow or cause any waste to be
committed or injury to occur to the Leased Premises, the Leasehold Improvements
or Fixtures or any other part of the Property, nor anything to be done in the
Leased Premises or on the Property which may be or result in a nuisance or
annoyance to other tenants or occupants of the Building. The Tenant will not
allow or cause the Leased Premises or any part of it to be used for any business
which, either directly or indirectly, involves the preparation, production or
storage of any toxic or hazardous substances or materials (the "Contaminants")
including, without limitation, any products of waste, asbestos, urea
formaldehyde foam insulation, radon gas, PCBs or any other contaminant as
defined in the Environmental Protection Act, R.S.O. 1980, c.141, as amended. The
Tenant is not liable for any contaminants left on the Leased Premises by the
previous tenants.
(c) The Tenant will not refer to the Building by any name
other than that designated from time to time by the Landlord and the Tenant will
use the name of the Building for the business address of the Tenant but for no
other purpose.
Section 6.3 Observance of Law. The Tenant will, at its expense, and
subject to Section 8.3:
(a) comply with all provisions or changes of law and other
requirements of all governmental bodies which pertain to or affect the Leased
Premises or require or govern the making of any repairs, alterations or other
changes of or to the Leased Premises or the Tenant's use of it;
(b) obtain all necessary permits, licenses and approvals
relating to the use of the Leased Premises and the conduct of business therein,
including, without limitation, those required under the applicable provincial or
federal Business Corporations Act(s) and the Investment Canada Act; and
(c) comply with all reasonable directions given or regulations
introduced by the Landlord or measures introduced by any governmental or
quasi-governmental authority from time to time in the interests of waste
recycling, environmental protection, energy conservation or the control of
Operating Costs.
ARTICLE 7
Insurance and Indemnity
Section 7.1 Tenant's Insurance.
(a) Throughout the Term and any period that the Tenant
occupies or is given possession of the Leased Premises, the Tenant shall, at its
expense, take out and keep in full force and effect and in the names of the
Tenant, the Landlord, the Owners and the Mortgagee as their respective interests
may appear, the following:
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(i) "all risks" (including flood and earthquake)
property damage insurance (containing disputed loss provisions) for the full
replacement cost of all property located in the Building which is owned by the
Tenant, or installed by or on behalf of the Tenant, or for which the Tenant is
legally liable, including but not limited to Alterations, Fixtures and Leasehold
Improvements;
(ii) broad form boiler and machinery insurance, if
applicable, (containing disputed loss provisions) on a blanket repair and
replacement basis with limits for each accident in an amount equal to the full
replacement cost of all Leasehold Improvements and of all boilers, pressure
vessels, air-conditioning equipment and other electrical apparatus owned or
operated by or on behalf of the Tenant;
(iii) business interruption insurance with at least
twelve (12) months indemnity in an amount sufficient to reimburse the Tenant for
loss of earnings attributable to perils insured against under Sections 7.l(a)(i)
and (ii);
(iv) comprehensive general liability insurance
(containing severability of interests and cross-liability clauses) including
personal injury, broad form contractual liability, owners' and contractors'
protective, contingent employers' liability, employers' liability, medical
payments, products liability, completed operations, and non-owned automobile
liability insurance, all with respect to the Leased Premises and the Tenant's
use of the Common Areas and Facilities. Such policies shall be written on a
comprehensive basis with inclusive limits of not less than Two Million Dollars
($2,000,000.00) per occurrence or such higher limits as the Landlord or the
Mortgagee may require from time to time;
(v) "all risks" tenant's legal liability insurance
for the replacement cost value of the Leased Premises, including loss of use
thereof; and
(vi) any other forms of insurance as the Landlord,
acting reasonably, or the Mortgagee requires from time to time, in forms and
amounts and for risks against which a prudent tenant would insure.
(b) The following terms and conditions are applicable to the
insurance policies specified under Section 7.1(a):
(i) the policies specified under Sections 7.l(a)(i),
(ii) and (iii) shall contain the Mortgagee's standard mortgage clause and may be
subject to reasonable deductibles. If there is a dispute as to the full
replacement cost, the Landlord's evaluation will prevail;
(ii) the policies specified under Sections 7.1(a)(i),
(ii) and (iii) shall contain a waiver of any subrogation rights which the
Tenant's insurers may have against the Landlord, the Owners and the Mortgagee
and those for whom they are in law responsible, whether the damage is caused or
contributed to by their act, omission or negligence;
(iii) all of the policies shall be taken out with
insurers reasonably acceptable to the Landlord and in a form reasonably
satisfactory to the Landlord;
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(iv) all of the policies shall be non-contributing
with and only apply as primary and not as excess to any other insurance
available to the Landlord, the Owners and the Mortgagee;
(v) all of the policies shall contain an
acknowledgement by the insurers that the policy shall not be invalidated as
respects the interests of the Landlord, the Owners and the Mortgagee by reason
of any breach or violation of any warranties, representations, declarations or
conditions contained in the policies; and
(vi) all of the policies shall contain an undertaking
by the insurers to notify the Landlord, the Owners and the Mortgagee in writing
not less than thirty (30) days prior to any material change, cancellation or
termination.
The Tenant agrees to deliver to the Landlord certificates of insurance
or, if requested by the Landlord, complete certified copies of policies, within
thirty (30) days' after the placing of the required insurance. No review or
approval of such insurance documentation by the Landlord shall derogate from or
diminish the Landlord's rights or the Tenant's obligations contained in this
Lease including, without limitation, those contained in Article 7.
(c) If there is damage or destruction to the Leasehold
Improvements in the Leased Premises, the Tenant will use the full insurance
proceeds received in respect of such damage or destruction for the sole purpose
of repairing or restoring them. If there is damage to or destruction of the
Building entitling the Landlord to terminate this Lease under Sections 9.1 or
9.2, then, if the Leased Premises have also been damaged or destroyed, the
Tenant will pay the Landlord all of its insurance proceeds relating to the
Leasehold Improvements.
Section 7.2 Increase in Insurance Premiums. If (a) the occupancy of the
Leased Premises; (b) the conduct of business in the Leased Premises; or (c) any
acts or omissions of the Tenant in the Leased Premises or in any ocher part of
the Building results in any increase in premiums to the insurance carried by the
Landlord with respect to any part of the Building, the Tenant will pay the
increase in premiums within five (5) days after invoices for additional premiums
are rendered by the Landlord. In determining whether the Tenant is liable for
increased premiums and the amount for which the Tenant is responsible, a
schedule issued by the organization that computes the insurance rate on the
Property showing the components of the rate will be conclusive evidence of the
items that make up the rate.
Section 7.3 Cancellation of Insurance. If any insurance policy in
respect of any part of the Building is cancelled or threatened by the insurer to
be cancelled, or the coverage reduced by the insurer by reason of the use and
occupation of the Leased Premises and if the Tenant fails to remedy condition
giving rise to cancellation, threatened cancellation or reduction of coverage
within forty-eight (48) hours after notice by the Landlord, the Landlord may, at
its option, either (a) exercise its rights of re-entry including termination
under Article 12, or (b) at the Tenant's expense, enter upon the Leased Premises
and remedy such condition.
Section 7.4 Loss or Damage. The Landlord and the Owners except for
gross negligence are not liable for any death or injury arising from or out of
any occurrence in, upon, at, or relating to the Building or damage to property
of the Tenant or of others wherever located,
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whether or not resulting from (a) the negligence of the Landlord or the Owners
or those for whom they may in law be responsible; (b) the Landlord's failure to
supply any services or utilities required by this Lease where the failure is
beyond the Landlord's reasonable control; (c) the existence of any Contaminants
which are or have been located, stored or incorporated in or on any part of the
Building; or (d) the exercise by the Landlord of any of its rights under this
Lease. Without limiting the generality of the foregoing, the Landlord and the
Owners shall not be liable for any injury or damage to Persons or property
resulting from fire, explosion, falling plaster, falling ceiling tile, falling
ceiling fixtures and diffuser coverings, steam, gas, electricity, water, rain,
flood, snow or leaks from any part of the Building, including pipes, sprinklers,
appliances, plumbing works, roof, windows or the surface of any floor or ceiling
of the Building or from any Lands adjoining the Building. In addition, the
Landlord and the Owners shall not be liable for any damage to or destruction of
any negotiable instruments, cash or other valuable property belonging to the
Tenant or others and stored or otherwise contained in the Leased Premises. All
property of the Tenant kept or stored on the Leased Premises or the Property
will be so kept or stored at the risk of the Tenant only and the Tenant shall
indemnify and save harmless the Landlord and the Owners from any claims arising
out of any damages to such property including, without limitation, any
subrogation claims by the Tenant's insurers. The intent of this Section is that
the Tenant (and all other Persons having business with the Tenant) is to look
solely to its insurers to satisfy any claim which may arise on account of death,
injury, loss or damage, irrespective of its cause.
Section 7.5 Landlord's Insurance
(a) The Landlord shall at all times throughout the Term carry:
(1) broad form boiler and machinery insurance on items owned by the Landlord
(except property that the Tenant and other tenants of the Building are required
to insure); (ii) insurance on the Building (excluding the foundations and
excavations) and the equipment contained in or servicing the Building, against
damage by fire and extended perils; (iii) public liability and property damage
insurance with respect to the Landlord's operations in the Building; and (iv)
other forms of insurance as would be carried by a prudent owner of a similar
office building or considered advisable by the Landlord, the Owners or any
Mortgagee.
(b) Notwithstanding the Landlord's Obligation to insure under
Section 7.5(a) and any contribution by the Tenant to the cost of the Landlord's
insurance premiums, (i) the Tenant is not relieved of any liability arising from
or contributed to by its negligence or its willful acts or omissions, (ii) no
insurable interest is conferred upon the Tenant under the Landlord's insurance
policies, and (iii) the Tenant has no right to receive proceeds from the
Landlord's insurance policies.
Section 7.6 Indemnification
The Tenant will indemnify and save harmless the Landlord and the Owners
from and against all loss, claims, actions, damages, costs, liability and
expense in connection with loss of life, personal injury, damage to property
(including any portion of the Building and its equipment, machinery, services
and Leasehold Improvements) or any other loss or injury arising from or out of
this Lease, or any occurrence on the Property or any part thereof, or the
Tenant's occupancy of the Leased Premises, or occasioned wholly or in part by
any act or omission of the
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Tenant or by anyone permitted to be in the Leased Premises or the Building by
the Tenant. If the Landlord or the Owners, without fault on their part, are made
a party to any litigation commenced by or against the Tenant, then the Tenant
will indemnify and save harmless the Landlord and the Owners from, and pay all
expenses and reasonable legal fees incurred by the Landlord and the Owners in
connection with the litigation. The Tenant will also pay all costs and legal
fees (on a solicitor and client basis) incurred by the landlord in enforcing the
terms, covenants and conditions in this Lease. The indemnity contained in this
Section 7.6 shall survive the expiration or earlier termination of this Lease.
ARTICLE 8
Maintenance, Repairs and Alterations
Section 8.1 Maintenance and Repairs by the Landlord
(a) The Landlord will maintain and repair the Structure, of
the Building and the mechanical, electrical, heating, ventilating,
air-conditioning and other base building systems of the Building, as would a
prudent owner of a similar building. Subject to Paragraph 23 of Schedule "F,"
the cost of such maintenance and repairs will be included in Operating Costs.
However, if the Landlord is required, due to the business carried on by the
Tenant, to make repairs or replacements to the Structure or any other part of
the Building by reason of the application of laws, ordinances or other
regulations of any governmental body, or by reason of any act, omission or
default of the Tenant or those for whom the Tenant is in law responsible, then
the Tenant will pay to the Landlord, upon demand, the total cost of those
repairs or replacements plus fifteen percent (15%) of such cost, representing
the Landlord's overhead and administrative costs.
(b) The Landlord will have the exclusive right to attend to
the replacement of standard electric light bulbs, tubes and ballasts in the
Leased Premises throughout the Term on the basis determined by the Landlord in
accordance with good commercial practice. The Landlord, at its option, may
either include the cost of replacement in Operating Costs or require the Tenant
to pay a monthly charge for such replacement (subject to adjustment based on
actual costs) per bulb, tube and ballast together with an amount equal to
fifteen percent (15%) of such cost, representing the Landlord's overhead and
administrative costs. If the Landlord elects not to relamp and reballast on a
scheduled basis, then the replacement of these standard electric light bulbs,
tubes and ballasts in the Leased Premises will be undertaken by the Landlord at
such time as they actually bum out and after notice from the Tenant that
replacement is required. In that event, the cost of replacement and installation
will be paid by the Tenant with the next monthly payment of Additional Rent,
together with an amount equal to fifteen percent (15 %) of such cost,
representing the Landlord's overhead and administrative costs.
Section 8.2 Maintenance and Repairs by the Tenant
(a) The Tenant will at all times, at its expense, maintain the
whole of the Leased Premises and the Leasehold improvements including without
limitation, all interior partitions, doors, plate glass (subject to Section
8.2(d)), electrical, lighting, wiring, plumbing fixtures and equipment and the
heating, ventilating and air-conditioning systems and equipment
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within or exclusively serving the Leased Premises in a similar condition as
received on the Commencement Date. The Tenant will make all needed repairs and
replacements with due diligence and dispatch. Upon the Landlord's request or if
required by any governmental or quasi-governmental authority, the Tenant will,
at its expense, remove from the leased Premises any Contaminants which are or
have been located, stored or incorporated in or on any part of the Leased
Premises. The foregoing obligation to remove Contaminants by the Tenants shall
survive the expiration of the Term or earlier termination of this Lease.
(b) Notwithstanding anything contained in this Lease, if any
such repairs or replacements or any Alterations to the Leased Premises or to any
Leasehold Improvements affect the Structure or any part of The electrical,
mechanical, plumbing, heating, ventilating, air-conditioning, lighting or other
base building systems of the Building, such work shall be performed only by the
Landlord at the Tenant's sole cost and Expense. The Tenant shall pay to the
Landlord, upon demand Landlord's costs relating to such repairs or replacements,
including but not limited to the fees of any architectural and engineering
consultants, plus a sum equal to fifteen percent (15 %) of such costs,
representing Landlord's overhead and administrative costs.
(c) The Tenant will leave the Leased Premises in a reasonably
neat and tidy condition at the end of each day in order that the Landlord's
cleaning services may be performed.
(d) The Tenant will immediately advise the Landlord of any
damage to the glass in or forming part of the exterior windows or storefronts of
the Leased Premises and the Landlord will effect the necessary repairs and
replacements. The cost of completing such repairs and replacements shall be
included in Operating Costs unless the damage resulted from the negligence or
willful act or omission of the Tenant, in which case the Tenant will pay to the
Landlord, upon demand, the Landlord's costs relating to such repairs or
replacements, plus a sum equal to fifteen percent (15%) of such costs,
representing the Landlord's overhead and administrative costs.
(e) At the expiration or earlier termination of the Term, the
Tenant will surrender the Leased Premises to the Landlord in as good-a condition
as the Tenant is required to maintain them throughout the Term, reasonable wear
and tear excepted.
(f) Notwithstanding anything contained in this Lease, if the
Building or the Structure or any part thereof, or any equipment, machinery,
facilities or improvements contained therein or made thereto, requires repair or
replacement or becomes damaged or destroyed as a result of the negligence or
willful act or omission of the Tenant or those for whom it is in law
responsible, the Tenant will pay to the Landlord upon demand, the cost of the
resulting repairs, replacements or alterations plus a sum equal to fifteen
percent (15 %) of such cost, representing the Landlord's overhead and
administrative costs.
(g) The Tenant shall immediately notify the Landlord of any
condition requiring repair in, or which might cause damage to, the Leased
Premises or the Building or any part thereof, whether or not the Landlord has
any obligations with respect thereto.
Section 8.3 Landlord's Approval of the Tenant's Repairs
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(a) The Tenant will not make any Alterations to any part of
the Leased Premises without first obtaining the Landlord's written approval. The
Landlord will not be required to consider any request for its approval until the
Tenant has submitted to it details of the proposed work, including
professionally prepared drawings if requested by the Landlord, and
specifications conforming to good engineering practices. The Landlord shall be
entitled to withhold its approval if, in its sole opinion, such Alterations
might decrease the Market Rental value of the Leased Premises or are
inconsistent or incompatible with the general design or quality of the Building.
Any approval shall be conditional upon the Tenant delivering to the Landlord
prior to the commencement of any such Alterations:
(i) evidence satisfactory to the Landlord that the
Tenant has obtained, at its expense, all necessary consents, permits, licenses
and inspections from all governmental and regulatory authorities having
jurisdiction; and
(ii) security in an amount and form required by the
Landlord, as an indemnification against construction liens, costs, damages and
expenses resulting from such Alterations.
(b) All Alterations will be performed; (1) by competent
workmen whose labour union affiliations are compatible with those employed by
the Landlord and its contractors in the Building, (ii) at the Tenant's expense,
(iii) in a good mid workmanlike manner; (iv) in accordance with the drawings and
specifications approved by the landlord; and (v) subject to Section 8.2(b) and
the reasonable regulations, controls and inspection of the Landlord.
(c) In addition to the Landlord's other rights and remedies
under this Lease and at law, if the Landlord requires, the Tenant ,will at its
expense promptly remove any Alterations made without the Landlord's approval or
not made in accordance with the drawings and specifications approved by the
Landlord, and restore the Premises to their previous condition.
Section 8.4 Removal and Restoration by the Tenant
(a) All Leasehold Improvements immediately become the property
of the Landlord upon affixation or installation and will not be removed unless
permitted or required by the Landlord. The Landlord has no obligation to repair,
maintain or insure the Leasehold Improvements. The Tenant will, prior to the end
of the Term, at its cost, remove all Fixtures and those Leasehold Improvements
(NOT APPROVED BY THE LANDLORD) which the Landlord requires the Tenant to remove
and will immediately repair any damage to the Leased Premises caused by their
installation or removal. NOTWITHSTANDING THE ABOVE, THE TENANT WILL NOT BE
OBLIGATED TO REMOVE ANY OF THE EXISTING IMPROVEMENTS IN THE LEASED PREMISES, AS
OF THE DATE OF THIS AGREEMENT, PRIOR TO THE END OF THE TERM.
(b) The Tenant will, prior to the end of the Term, at its
cost, deliver to the Landlord evidence (including any clearance certificates and
demolition permits) satisfactory to the Landlord that there are no Contaminants
located, stored or incorporated in or on any part of the Leased Premises, in
accordance with all applicable legislation and safety requirements.
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(c) The Landlord may, as it sees fit and without notice to the
Tenant, immediately remove from the Leased Premises and store or dispose of all
fixtures, Leasehold Improvements and Contaminants not removed by the Tenant as
required under Section 8.2(a) and Sections 8.4(a) and (b). The Tenant shall pay
to the Landlord, upon demand, all costs incurred by the Landlord in removing,
storing or disposing of such Fixtures, Leasehold Improvements or Contaminants
plus a sum equal to fifteen percent (15%) of such costs, representing the
Landlord's overhead and administrative costs.
(d) The Tenant will effect any installation or removal of
Fixtures, Leasehold Improvements or Contaminants, whether during or at the
expiration of the Term, only at times prescribed by the Landlord and utilizing
only elevators and other services designated by the Landlord, and the Tenant
will immediately repair any damage caused to the Leased Premises or the Building
or any part thereof by any such installation or removal, all at its expense.
(e) Any Fixtures not removed from the Leased Premises at the
end of the Term, will at the Landlord's option, become the property of the
Landlord (and, in such event, this paragraph shall have the effect of assigning
the Tenant's right and title in such Fixtures to the Landlord) and may be
removed from the Leased Premises and sold or disposed of by the Landlord in such
manner as it deems advisable.
Section 8.5 Tenant to Discharge all Liens
(a) The Tenant will not allow or cause any construction or
other liens or encumbrances in respect of materials supplied or work done or to
be done by or on behalf of the Tenant or related to the Tenant's Work to be
registered against or otherwise affect the Building, the Lands, the Leased
Premises or any part thereof of the Landlord's, the Owners' or the Tenant's
interest in the Leased Premises.
(b) If a lien or other encumbrance is registered against or
otherwise affects the Building or the Leased Premises or the Landlord's, the
Owners' or the Tenant's Interest therein, and the Tenant fails to discharge or
cause any such lien or encumbrance to be discharged or removed within five (5)
days after it is filed or registered, then the Landlord may, in addition to its
other rights and remedies, discharge or remove the lien or encumbrance by paying
the amount claimed plus any additional costs incurred by the Landlord into court
or directly to the lien claimant and the Tenant will pay to the Landlord, upon
demand, all costs (including the amount so paid and any legal costs and
expenses) so incurred by the Landlord plus interest at an annual rate of four
(4) percentage points above the Prime Xxxx, calculated and compounded monthly,
and a sum equal to fifteen percent (15%) of such costs, representing the
Landlord's overhead and administrative costs.
Section 8.6 Right of Entry
(a) The Landlord and its agents leave the right to enter the
Leased Premises at all reasonable times with at least 24 hours prior notice (and
at any time in the event of an emergency), without affecting the Tenant's
covenants, obligations or agreements under this Lease, to show them to
prospective purchasers, tenants or mortgagees, and to supervise any work in or
examine them or any portion of The Building and to obtain information for the
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determination of the Rentable Area or the Usable Area of the Leased Premises or
for the preparation of plans in respect of any portion of the Building, and to
make repairs, alterations or changes to the Leased Premises or the Building as
are permitted of required to be performed by the Landlord under this Lease. For
that purpose, the Landlord may take all required material into the Leased
Premises, may have access to all ducts located under the floor or above the
ceiling and to access panels to mechanical shafts, and may check,. calibrate,
adjust or balance any controls or other parts of any heating, ventilating and
air-conditioning equipment and facilities.
(b) If the Tenant is not personally present to open and permit
an entry into the Leased Premises at any time when for any reason an entry
therein is necessary or permissible, the Landlord or its agents may forcibly
enter the same, without rendering the Landlord or such agents liable therefor,
and without affecting the Tenant's covenants, obligations and agreements under
this Lease. However, nothing in this Section 8.6 shall be construed to impose
upon the Landlord any obligation for the care, maintenance or repair of the
Leased Premises, or any part thereof, except as otherwise specifically provided
in this Lease. The Tenant agrees that any entry by the Landlord upon the Leased
Premises in accordance with this Section 8.6 is not a re-entry or a breach of
any covenant for quiet enjoyment contained in this Lease or implied by law.
Section 8.7 Signs and Advertising
The Tenant will not allow or cause any notice, lettering or other sign
to be erected or placed on any part of the outside of the Building or on the
exterior or in the interior of the Leased Premises so as to be visible from the
outside of the Leased Premises. The Landlord may prescribe a uniform pattern of
identification signs for tenants to be placed in a location designed by the
Landlord. The Landlord will install, at the Tenant's expense, a maximum of two
(2) of the Landlord's standard tenant identification signs in accordance with
the Landlord's design criteria, on or near the main door to the Leased Premises
in the building directory and on the floor directory, and, at the Landlord's
option, at other locations on the floor on which the Leased Premises are
located. At the expiration or earlier termination of this Lease, the Tenant will
remove all signs, pictures, advertisements, notices, letterings or decorations
from the Leased Premises at the Tenant's expense and will promptly repair all
damage caused by their installation or removal. The Landlord will provide a
directory board in the main lobby of the Building in a location designated by
the Landlord in which event the Tenant's name may be displayed therein and, if
so displayed, the Tenant shall pay to the Landlord the cost of such display and
any ongoing cost thereof.
Section 8.8 Tenant Not to Overload Facilities
The Tenant will not install any equipment which will exceed or overload
the capacity of any utility, electrical or mechanical facilities in or serving
the Leased Premises and the Tenant will not bring into the Leased Premises or
install any utility, electrical or mechanical facility or service of which the
Landlord does not reasonably approve. The Tenant agrees that if any installed by
the Tenant requires additional utility, electrical or mechanical facilities, the
Landlord may if they are available, elect to install them in accordance with
plans and specifications to be approved in advance in writing by the Landlord.
The Tenant will pay to the Landlord, upon demand, the total cost incurred by the
Landlord in connection with any such installation plus a
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sum equal to fifteen percent (15%) of such cost, representing the Landlord's
administrative and overhead costs.
Section 8.9 Tenant Not To Overload Floors
The Tenant will not bring upon the Building or the Leased Premises any
machinery, equipment, article or thing that by reason of its weight, size or
use, might in the opinion of the Landlord damage the Building or the Leased
Premises and will not at any time overload the floors of the Leased Premises. If
any damage is caused to the Building or the Leased Premises by any machinery,
equipment, object or thing or by overloading, the Tenant will forthwith repair
such damage, or, at the option of the Landlord, pay to the Landlord, upon
demand, the cost of repairing such damage plus a sum equal to fifteen percent
(15 %) of such cost, representing the Landlord's administrative and overhead
costs.
ARTICLE 9
Damage and Destruction
Section 9.1 Destruction of the Leased Premises
(a) If the Leased Premises are destroyed or damaged as a
result of fire or any other peril which is insured against by the Landlord, then
if:
(i) the Leased Premises are rendered wholly or
partially untenantable, this Lease will continue in effect and the Landlord will
commence diligently to restore the Leased Premises to the extent only of
insurance proceeds actually received by the Landlord and only to the extent of
the Landlord's Work set out in Schedule "C" of this Lease. To the extent of
insurance proceeds actually received by the Landlord, Basic Rent will xxxxx
entirely or proportionately, as the case may be, to the portion of the Leased
Premises rendered untenantable from the date of the destruction or damage until
the Landlord has substantially completed its restoration work; or
(ii) the Leased Premises are not rendered
untenantable in whole or in part, this Lease will continue in effect, the Rent
and other amounts payable by the Tenant will not xxxxx and the Landlord will
commence diligently to restore the Leased Premises to the extent required by
this Section 9.1(a).
(b) Once the Landlord has substantially completed the
Landlord's Work in accordance with Section 9.l(a), the Tenant will complete all
work required to fully restore the Leased Premises for business, including,
without limitation the Tenant's Work. Nothing in this Section 9.1 requires the
Landlord to rebuild the Leased Premises in the condition and state that existed
before the damage, but the Leased Premises, as rebuilt, will have reasonably
similar facilities and services to those in the Leased Premises prior to the
damage.
(c) Notwithstanding Section 9.1(a), if the Leased Premises are
damaged or destroyed by any cause whatsoever the Leased Premises cannot be
rebuilt to the extent of the Landlord's Work within ninety (90) days of the
damage or destruction (assuming normal working days without overtime), the
Landlord may, instead of rebuilding or making the Leased
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Premises fit for the Tenant in accordance with Section 9.1(a), terminate this
Lease by written notice to the Tenant given within thirty (30) days after the
damage or destruction, and in such event Rent will xxxxx as of the date of
damage or destruction.
Section 9.2 Destruction of the Building.
(a) Notwithstanding Section 9.1, if twenty-five percent (25%)
or more of the Rentable Area of the Building is damaged or destroyed (whether or
not the Leased Premises are damaged or destroyed) and if the damaged or
destroyed parts of the Building cannot be rebuilt to the extent of the
Landlord's Work or made fit for the purposes of the respective occupants of the
premises within ninety (90) days of the damage or destruction (assuming normal
working days without overtime), then the Landlord may terminate this Lease upon
not less than thirty (30) days' notice by written notice to the Tenant given
within sixty (60) days after the damage or destruction, and in such event, Rent
will xxxxx as of the effective date of the termination.
(b) If any part of the Building is destroyed or damaged and
the Landlord does not elect to terminate this Lease, the Landlord will commence
diligently to restore the Building, to the extent only of insurance proceeds
actually received by the Landlord and to the extent only of the Landlord's work
described in the various Leases for the affected premises in the Building, and
exclusive of any tenant's responsibilities set out therein. If the Landlord
elects to restore the Building, the Landlord may restore according to plans and
specifications and working drawings other than those used in the original
construction of the Building.
Section 9.3 Expropriation.
Both the Landlord and Tenant agree to co-operate with the other
regarding an expropriation of the Leased Premises or the Property or any part
thereof, so that each may receive the maximum award to which they are
respectively entitled at law. To the extent that any portion of the Property
other than the Leased Premises is expropriated, the full proceeds accruing or
awarded as a result will belong to the Landlord and the Tenant and will be
equitably divided based on the final determination of the governing body as
outlined in any expropriation award.
Section 9.4 Architect.
The opinion, decision or certificate of the Architect will bind the
parties as to (a) the percentage of the Rentable Area of the Building damaged or
destroyed; (b) the period of time required to restore the Leased Premises or the
Building; (c) whether and to what extent the Leased Premises are rendered
untenantable; (d) the date upon which the Landlord's or Tenant's restoration
work is completed or substantially completed and the date when the Leased
Premises are rendered tenantable; and (e) the state of completion of any
Landlord's or Tenant's work under this Lease.
ARTICLE 10
Assignment and Subletting
Section 10.1 Assignment and Subletting.
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(a) The Tenant will not enter into an assignment (whether by
operation of law or otherwise) nor a mortgage, charge or debenture (floating or
otherwise) of this Lease, the Leasehold Improvements, the Fixtures or the Leased
Premises, nor a sublease or sharing or parting with possession of all or any
part of the Leased Premises (individually and collectively, a "Transfer"), with
or in favour of any Person except to a subsidiary or affiliate, in which case
written notification must be provided to the Landlord (a "Transferee"), without
first submitting to the Landlord a written request for the Landlord's consent to
the Transfer and obtaining the Landlord's prior written consent to the Transfer.
Notwithstanding the Landlord and Tenant Act (Ontario) or any other statute of
common law, (i) such consent may be unreasonably withheld if the Landlord
exercises its termination right set out in Section 10.1(d), but otherwise will
not be unreasonably withheld, and (ii) the Landlord will be deemed to be
reasonable in withholding its consent to any Transfer if:
(i) the Transfer is contrary to any covenants or
restrictions granted by the Landlord to other existing or prospective tenants or
occupants of the Building, or to the Mortgagee or any other parties;
(ii) in the Landlord's opinion: (1)\ the financial
background, business history and capability of the Transferee is not
satisfactory, (2) the Transferee may not be able to pay the Rent in full when
due and payable; or (3) the nature or character of the proposed business of the
Transferee is such that it might harm the Landlord's business or reputation or
reflect unfavourably on the whole or any part of the Building, the Landlord, the
other tenants of the Building or the image of any of them, or is unethical,
immoral or illegal;
(iii) the Landlord at that time has, or will have in
the next ensuing three month period, other premises elsewhere in the Building
which might be suitable for the needs of the Transferee:
(iv) the Transferee pays of gives to the Transferor
money or other value that is reasonably attributable to the desirability of the
location of the Leased Premises or to the Alterations that are owned by the
Landlord or that the Landlord has paid for in whole or in part;
(v) the Transfer is in favour of any existing
occupant of the Building;
(vi) the Landlord does not receive sufficient
information from the Tenant of the Transferee to enable it to make a
determination concerning the matters set out above; or
(vii) any amount of Rent payable by the Transferee
pursuant to the Transfer is less than that provided for in this Lease, or the
Transfer is otherwise on terms more favourable to the Transferee than the terms
set forth in this Lease.
(b) "Transfer" includes (i) any disposition (whether by
operation of law or otherwise), redemption or subscription of any shares of the
Tenant or of any occupant of the Leased Premises or of any of their "affiliates"
(within the meaning of the Canada Business Corporations Act) which results in a
change in the direct or indirect effective control of the Tenant or of any
occupant of the Leased Premises (if the Tenant or occupant is or becomes a
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corporation), unless (A) the disposition, redemption or subscription is of
shares that are listed and traded on any recognized stock exchange in Canada or
the United States, and (B) the Landlord is satisfied that there will be a
continuity of business practices and policies, and management of the Tenant or
occupant of the Leased Premises; and (ii) any disposition, redemption or
acquisition (whether by operation of law or otherwise) of a partnership interest
in the Tenant or any occupant of the Leased Premises which results in a change
in the effective control of the Tenant or of any occupant of the Leased Premises
(if the Tenant or occupant is a partnership or is directly or indirectly
controlled by a partnership), unless the Landlord is satisfied that there will
be a continuity of business practices and policies, and management of the
Tenant. For a Transfer described in this Section 10.1(b), the Transferor is the
Person that has effective control before the Transfer and the Transferee is the
Person that has effective control after the Transfer.
(c) The consent by the Landlord to any Transfer will not
constitute a waiver of the necessity for consent to any subsequent Transfer.
(d) Any request by the Tenant for the Landlord's consent to a
Transfer will specify the proposed Transferee and provide full particulars of
the Transfer including, without limitation, copies of any written offer,
agreement or draft agreement with respect to the Transfer, setting out the terms
the Tenant is prepared to accept subject to compliance with this Lease and
disclosing any monetary payments or other consideration made or to be made by
the Transferee as consideration for the Transfer and any other information
concerning the Transfer or the financial or business status of the Transferee
that the Landlord may require. The Landlord will, within fifteen (15) days after
receipt of the request and all necessary information, notify the Tenant in
writing either that (i) it consents or does not consent to the Transfer, or (ii)
it elects to cancel this Lease as to the whole or the part of the Leased
Premises intended to be affected by the Transfer, instead of consenting to the
Transfer. The Landlord's failure to respond within such fifteen (15) day period
will not be construed as a consent by the Landlord. If the Landlord elects to
cancel this Lease, the Tenant may, by written notice to the Landlord given
within seven (7) days after receipt of the Landlord's notice of termination,
withdraw its request for the Landlord's consent and, in such event, the
Landlord's election to cancel this Lease will be void and of no effect
whatsoever, and the Transfer will not take place. If the Tenant fails to so
withdraw its request for the Landlord's consent, the Tenant will deliver vacant
possession of the whole or part, as the case may be, of the Leased Premises
affected by the termination on the date specified in the Landlord's notice of
termination (the "Termination Date"), which shall be not less than thirty (30)
days, nor more than one hundred and twenty (120) days after the date such notice
is given, Rent will be apportioned to the Termination Date and this Lease will
expire on the Termination Date with respect to such part or the whole of the
Leased Premises as though the Termination Date were the date set for expiration
of the Term. If the Tenant is required to deliver possession of a part only of
the Leased Premises, the Tenant will (A) pay to the Landlord all costs incurred
in connection with rendering such part functionally separate and suitable for
separate use and occupancy, including partitioning and providing entrances and
services thereto, plus a sum equal to fifteen percent (15%) of such costs,
representing the Landlord's administrative and overhead costs, and (B) perform
all necessary modifications in the remaining portion of the Leased Premises in
accordance with Section 8.3.
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(e) Following any Transfer, the Landlord may collect Rent from
the Transferee and apply the net amount collected to the Rent payable under this
Lease, but no acceptance by the Landlord of any payments by a Transferee will
constitute a waiver of the requirement for the Landlord's consent to such
Transfer, or an acceptance of the Transferee as the Tenant, or a release of the
Tenant from the further performance by the Tenant of its covenants and
obligations under this Lease. Any documents evidencing the Transfer may, at the
Landlord's option, be prepared by the Landlord or its solicitors, and all legal
costs incurred by the Landlord will be paid by the Tenant to the Landlord or its
solicitors. Unless the Transferee is a subtenant, upon the Transfer the
Transferor will retain no rights under this Lease in respect of the Leased
Premises or the obligations to be performed by the Landlord under this Lease,
but notwithstanding anything to the contrary, the Transferor will not be
released from the covenants, obligations and agreements on the part of the
Tenant under this Lease.
(f) Any consent by the Landlord to a Transfer will be subject
to the following conditions:
(i) the Basic Rent payable under the Lease will be
the amount equal to the greatest of:
(1) the Landlord's rental rate for promises
in the Building similar to the Leased Premises at the time of the Landlord's
consent,
(2) the Basic Rent payable immediately prior
m the Transfer; and
(3) the current Basic Rent multiplied by the
percentage increase in the Consumer Price Index [(All items for Regional Cities)
for the City of Toronto (or if the Consumer Price Index is no longer published,
any replacement index designated by the Landlord) with any necessary conversions
to be made by the Landlord)] from the month in which the Commencement Date
occurs to the month in which the Transfer occurs.
If the annual Basic Rent is to increase at specified times in
accordance with this Lease, such increases will be added to the Basic Rent as
determined above;
(ii) the Tenant will pay to the Landlord any money or
other value (including, without limitation, any amount payable by the Transferee
to the Tenant in excess of the Basic Rent payable by the Tenant under Section
3.2) which is paid by any Transferee to the Tenant in connection with a
Transfer;
(iii) if the Landlord requires, the Transferee will,
unless the Transfer is one that is described in Section 10.1(b)(i), execute an
agreement with the Landlord agreeing to be bound by this Lease and the
Transferor will execute an indemnity agreement on the Landlord's standard form
in respect of obligations to be performed by the Transferee after the Transfer;
and
(iv) any reasonable legal costs of the Landlord in
connection with documents relating to the Transfer or the Landlord's consent,
will be paid by the Tenant together with the Landlord's administrative charge
for providing its consent.
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(g) The Tenant acknowledges and agrees that the Landlord will
not be liable for any claims, actions, damages, liabilities or expenses of the
Tenant or any Transferee arising out of the Landlord delaying or unreasonably
withholding its consent to any Transfer and the Tenant's only recourse will be
to bring an application for a declaration that the Landlord must grant its
consent to the Transfer.
(h) The Tenant shall not advertise the whole or any part of
the Leased Premises or this Lease for the purposes of a Transfer and shall not
print, publish, post, display or broadcast any notice or advertisement to that
effect and shall not permit any broker or other Person to do any of the
foregoing, unless the complete text and format of any such notice,
advertisement, or offer is first approved in writing by the Landlord. Without in
any way restricting or limiting the Landlord's right to refuse any text or
format on other grounds, any text or format proposed by the Tenant shall not
contain any reference to the rental rate of the Leased Premises or any other
premises in the Building.
Section 10.2 Assignment by the Landlord.
If there is a sale, lease or other disposition by the Landlord of the
Property or any part thereof, or the assignment by the Landlord of this Lease or
any interest of the Landlord hereunder, then to the extent that the purchaser or
assignee assumes the covenants and obligations of the Landlord under this Lease,
the Landlord will, without further agreement, be released from all liability
with respect thereto.
ARTICLE 11
Status, Statement, Subordination and Attornment
Section 11.1 Status Statement.
Within ten (10) days after written request by the Landlord, the Tenant
will execute and deliver, without charge and in a form supplied by the Landlord,
a certificate or acknowledgement of the status and validity of this Lease, the
state of the rental account hereunder and other information reasonably required
by the Landlord.
Section 11.2 Subordination and Attornment.
(a) This Lease and the Tenant's rights hereunder are, and will
at all times be, subordinate to all ground or underlying leases, mortgages,
trust deeds or the charge or lien resulting from, or any instruments of, any
financing, refinancing or collateral financing (collectively, an "Encumbrance")
and to any advances thereon and renewals or extensions thereof from time to time
affecting the Property or any part thereof and the Tenant will, upon request and
without charge, execute and deliver any document reasonably requested by the
Landlord to confirm the foregoing. The Tenant will also, if requested, attorn to
(i) the Owners, the holder of any Encumbrance, or any representative, receiver
or receiver-manager appointed or designated by such holder and (ii) any
purchaser, transferee or disposee of the Property (or any part of it) or of any
ownership or equity interest in the Property (or any part of it), including any
purchaser at a foreclosure sale or any sale under a power of sale, under any
Encumbrance. The
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Landlord shall use its reasonable efforts to obtain a
non-disturbance agreement, on the mortgagee's standard form with respect to its
encumbrance.
(b) The form and content of any document requested under
Section 11.2(a) will be that required by the Landlord, the holder of the
Encumbrance or the purchaser, transferee or disposee, as the case may be, and
the Tenant win execute and deliver any such document to the Landlord within ten
(10) days after the request is made.
Section 11.3 Execution of Documentation.
The Tenant will, upon the Landlord's request, execute and deliver to
the Landlord within ten (10) days after the request is made, any statements,
instruments and certificates required to carry out the intent of Section 11.1 or
Section 11.2. In addition to the Landlord's other remedies under this Lease and
at law, if the Tenant fails to so execute and deliver any such statements,
instruments or certificates, the Tenant irrevocably appoints the Landlord as the
Tenant's attorney with full power and authority to execute and deliver, in the
name of the Tenant, all such statements, instruments and certificates.
ARTICLE 12
Default
Section 12.1 Right to Re-enter.
(a) An "Event of Default" occurs whenever:
(i) any Rent or Sales Taxes are nor paid when due and
payable;
(ii) any covenant or condition of this Lease to be
observed or performed by the Tenant is breached (other than a breach specified
in Section 12.1(a) (iii)) and (A) the breach is not remedied within ten (10)
days after written notice to the Tenant specifying the particulars of the
breach, or (B) if ten (10) days is not a reasonable time to remedy the breach,
the Tenant has not commenced diligently to remedy the breach within such ten
(10) day period and is not providing diligently to remedy the breach thereafter
within a reasonable time; or
(iii) any of the following events occurs:
(1) a report, statement or certificate
delivered by the Tenant pursuant to this Lease is false or misleading except for
a misstatement that is the result of an inadvertent or unintentional error,
(2) the Tenant, or a Person carrying on
business in a part of the Leased Premises, or an Indemnifier becomes bankrupt or
insolvent or takes the benefit of any statute for bankrupt or insolvent debtors
or any proposal, assignment or arrangement with its creditors;
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(3) a receiver or a receiver and manager is
appointed for all or a part of the property of the Tenant, or of another Person
carrying on business in the Leased Premises, or of an Indemnifier;
(4) steps are taken or proceedings are
instituted for the dissolution, winding up or other termination of the Tenant's
or the Indemnifier's existence or the liquidation of their respective assets;
(5) the Tenant or the Indemnifier makes or
attempts to make a bulk sale of any of their assets regardless of where they are
situated (except for a bulk sale made to a Transferee when the Transfer is
permitted under this Lease or has been consented to by Landlord);
(6) property is sold, disposed of or removed
from the Leased Premises so that there does not remain sufficient property on
the Leased Premises available for distraint, free and clear of any lien, charge
or other encumbrance ranking ahead of the Landlord's right of distress, to
satisfy the Rent due or accruing for at least twelve (12) months;
(7) the Leased Premises are vacant or
unoccupied for five (5) consecutive days, or the Tenant abandons or attempts to
abandon the Leased Premises;
(8) the Tenant effects or attempts to effect
a Transfer that is not permitted by this Lease; or
(9) this Lease or any of the Tenant's assets
on the Leased Premises are taken or seized under a writ of execution, an
assignment, pledge, charge, debenture, or other security instrument.
(b) Upon the occurrence of an Event of Default, (i) the full
amount of the current month's and the next three (3) month's installments of
Rent (calculated according to Section 12.1(c)), and Sales Taxes will become due
and payable, and (ii) the Landlord may re-enter and re-possess the Leased
Premises and on such a re-entry, this Lease and all of the Tenant's rights
hereunder will terminate without liability on the part of the Landlord for loss
or damage, and without prejudice to the Landlord's rights to recover arrears of
Rent or Sales Taxes or damages for any previous breach by the Tenant of any
covenant or condition of this Lease. On such a termination, (1) the Tenant will
promptly (and in any case within ten (10) days after written notice requiring it
to do so) remove all of its property from the Leased Premises, or (2) the `
Landlord may at any time remove all or part of the property from the Leased
Premises and store it in a public warehouse or elsewhere at the cost of the
Tenant. The Landlord will not be responsible for loss or damage to any of the
Tenant's property regardless of how the loss or damage is caused, and regardless
of negligence. If the Tenant fails to remove its property as required by clause
(1) above, or if it fails to pay the Landlord's costs of removal and storage
within ma (10) days after written notice specifying those costs, the Tenant will
be considered to have abandoned its property and the Landlord will be entitled
to retain it or to sell or dispose of the Tenant's property for the Landlord's
own benefit. Notwithstanding any such termination, the Landlord shall be
entitled to recover damages from the Tenant including, but not limited to, (A)
damages for loss of Rent and Sales Taxes suffered by of this Lease having been
prematurely
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terminated; (B) the cost of recovering the Leased Premises; and (C) solicitor's
fees on a solicitor and his client's basis.
(c) The Tenant agrees that despite anything contained in the
Landlord and Tenant Act (in particular, but not limited to Section 19(2)), no
notice of an Event of Default or of a breach of any covenant or condition of
this Lease will be considered void or ineffective as of the result of a minor or
technical inaccuracy or error.
Section 12.2 Rejection of Tenant's Repudiation.
If an Event of Default occurs the Landlord may, instead of terminating
this Lease, insist on the performance of the covenants and conditions of this
Lease and in that case may do both or either of the following: (a) levy distress
for arrears of Rent; and (b) take legal proceedings against the Tenant for both
or either of (i) payment of Rent and Sales Taxes as they become due; and (ii)
performance of the covenants and conditions of this Lease; all without
prejudice, however, to the Landlord's right to terminate this Lease at any time
should the Event of Default continue unremedied.
Section 12.3 Expenses.
If legal proceedings are brought for recovery of possession of the
Leased Premises, for the recovery of Rent or Sales Taxes, or because of an Event
of Default by the Tenant, the Tenant will pay to the Landlord its expenses,
including its solicitors' fees (on a solicitor his client's basis).
Section 12.4 Waiver of Exemption from Distress.
Notwithstanding the Landlord and Tenant Act or any other applicable
legislation, none of the furniture, equipment or other property that is, or was
at any time, owned by the Tenant is exempt from levy by distress for Rent.
Section 12.5 Landlord May Cure the Tenant's Default.
If the Tenant defaults in the payment of money that it is required
under this Lease to pay to a third party, the Landlord may, after giving five
(5) days notice in writing to the Tenant, pay all or part of the amount payable.
If the Tenant commits a breach of a covenant or condition of this Lease (except
for default in the payment of Rent) the Landlord may, after giving reasonable
notice (it being agreed that forty-eight (48) hours is a reasonable notice of
default of Section 7.1), or, without notice in the case of an emergency, perform
or cause to be performed all or part of what the Tenant failed to perform and
may enter upon the Leased Premises and do those things that the Landlord
considers necessary for that purpose. The Tenant will pay to the Landlord on
demand, the Landlord's expense incurred under this Section 12.5 plus an amount
equal to fifteen percent (15%) of those expenses for the Landlord's overhead and
administrative costs. The Landlord will have no liability to the Tenant for loss
or damages resulting from its action or entry upon the Leased Premises.
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(a) The Tenant will pay to the Landlord, upon demand, a late
payment service charge of Two Hundred and Fifty Dollars ($250.00) for any
payment of Rent not paid when due pursuant to this Lease.
Section 12.6 Application of Money.
The Landlord may apply money received from or due to the Tenant against
money due and payable under this Lease.
Section 12.7 Remedies Generally.
The remedies under this Lease are cumulative. No remedy is exclusive or
dependent upon any other remedy. Any one or more remedies may be exercised
generally or in combination. The specifying or use of a remedy under this Lease
does not limit rights to use other remedies available under this Lease or at law
generally. Subject to Section 10.1(g), any breach by the Landlord under this
Lease can be adequately compensated in damages and the Tenant agrees that its
only remedy to enforce its rights under this Lease is an action for damages.
ARTICLE 13
Miscellaneous
Section 13.1 Rules and Regulations.
The Tenant will observe any rules and regulations from time to time
adopted by the Landlord for all or any part of the Property (the "Rules and
Regulations"), including but not limited to those set out in Schedule "E," and
all such Rules and Regulations are a part of this Lease. The Rules and
Regulations may differentiate between different types of businesses, but the
Rules and Regulations will be adopted and promulgated by the Landlord acting
reasonably and in such manner as would a prudent landlord of a reasonably
similar facility. The Landlord may amend or supplement the Rules and Regulations
as the Landlord considers necessary for the safety, care, cleanliness and
efficient operation of all or any part of the Property. Notice of the Rules and
Regulations and amendments and supplements, if any, will be given to the Tenant
and the Tenant will thereupon observe them provided that they do not contradict
any terms, covenants and conditions of this Lease. The Landlord cannot change or
enforce any Rules and Regulations that are unreasonable or discriminatory.
Section 13.2 Intent and Interpretation.
(a) Net Lease.
It is intended that this Lease is a completely carefree net lease to
the Landlord. Except as expressly set out in this Lease, 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 Leased Premises, or the use
and occupancy thereof and the Tenant will pay all charges, impositions, costs
and expenses of every nature and kind relating to the Leased Premises except as
expressly set out in this Lease.
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(b) Obligations as Covenants and Severability.
Each obligation or agreement of the Landlord or the Tenant expressed in
this Lease, even if not expressed as a covenant, is considered to be a covenant.
If any provision of this Lease is or becomes unenforceable, it shall be
considered separate and severable from the Lease and the remaining provisions
shall remain in force and be binding upon the parties as though such provision
had not been included.
(c) Entire Agreement and Amendment or Modification.
This Lease and the Schedules, and Riders, if any, attached together
with the Rules and Regulations set forth all covenants, promises, agreement,
conditions or understandings, either oral or written, between the Landlord and
the Tenant. No alteration or amendment to this Lease will be binding upon the
Landlord or the Tenant unless in writing and signed by the Tenant and the
Landlord.
(d) Governing Law.
This Lease will be construed in accordance with and governed by the
laws of the Province of Ontario.
(e) Time of the Essence.
Time is of the essence of this Lease and of every part of it.
Section 13.3 Overholding - No Tacit Renewal.
If the Tenant remains in possession of the Leased Premises after the
end of the Term without having signed a new lease or an extension of Term
agreement, there is no tacit renewal of this Lease or the Term, notwithstanding
any statutory provisions or legal presumptions to the contrary, and the Tenant
will be deemed to be occupying the Leased Premises as a tenant from
month-to-month at a monthly Basic Rent equal to twice the monthly amount of
Basic Rent payable during the last month of the Term, and otherwise, upon the
same terms, covenants and conditions as are set for in this Lease (including the
payment of Additional Rent) so far as they are applicable to a monthly tenancy.
Section 13.4 Tenant Partnership or Group.
(a) If the Tenant is a partnership, each Person who is or
subsequently becomes a member of the partnership or any successor thereof will
be and continue to be subject to and jointly and severally liable for the
performance and observance of the terms, covenants and conditions of this Lease,
even if the Person ceases to be a member of such partnership or successor
thereof.
(b) If the Tenant is comprised of more than one (1) Person,
each such Person will be and continue to be subject to and jointly and severally
liable for the performance and observance of the terms, covenants and conditions
of this Lease, even if the Person ceases to be involved in the business
conducted from the Leased Premises.
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Section 13.5 Waiver.
(a) No waiver by either party of any breach by the other of
any term, covenant or condition of this Lease, will constitute a waiver of
either party's right in respect of any continuing or subsequent breach. No
waiver will be inferred from or implied by any subsequent acceptance of Rent by
the Landlord, even if the Landlord knew of the preceding breach at the time it
accepted the Rent, nor from or by anything done or omitted to be done by the
Landlord except from or by an express written waiver by the Landlord.
(b) All Rent is payable by the Tenant in accordance with
Section 3.1, and the Tenant waives the benefit of any statutory or other rights
from time to time existing in respect of abatement, set-off or compensation.
Section 13.6 Limitation of Liability.
Notwithstanding anything contained in this Lease or in any statutory
provision or any rule of law to the contrary, the Tenant acknowledges and agrees
that if it obtains a monetary judgment or award in its favour against the
Landlord (which is not under appeal by the Landlord):
(a) the Tenant shall be entitled to satisfy such judgment or
award only to the extent of the Landlord's estate and interest in the Property,
subject to the prior rights of the Mortgagees or other encumbrancers; and
(b) the Tenant shall not be entitled to levy execution or to
enforce its judgment or award by lien, attachment or any other enforcement
procedure for the satisfaction of any such judgment or award against any
property of the Landlord other than the Landlord's estate and interest in the
Property.
Section 13.7 Accord and Satisfaction.
No payment by the Tenant or receipt by the Landlord of a lesser amount
than the monthly payment of Rent stipulated is deemed to be other than on
account of the earliest stipulated Rent, nor is any endorsement or statement on
any cheque or any letter accompanying any cheque or payment as Rent deemed an
acknowledgment of full payment of accord and satisfaction. The Landlord may
accept and cash any cheque or payment without prejudice to the Landlord's right
to recover the balance of the Rent due or to pursue any other remedy provided in
this Lease.
Section 13.8 Force Majeure.
Notwithstanding anything in this Lease, if either party is bona fide
delayed or hindered in or prevented from the performance of any term, covenant
or act required hereunder by reason of strikes or labour troubles; inability to
procure materials or services; power failure; restrictive governmental laws or
regulations; riots; insurrection; sabotage; rebellion; war; act of God; or other
reason whether of a like nature or not which is not the fault or within the
reasonable control of the party affected, then the performance of that term,
covenant or act is excused for the period of the delay and the time for
performing that term, covenant or act will be extended accordingly.
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However, the provisions of this Section do not operate to excuse the Tenant from
the prompt payment of Rent.
Section 13.9 Notices.
Any notice, demand, request or other instrument required or permitted
to be given under this Lease shall be in writing, and (a) if given by the Tenant
to the Landlord shall be sufficiently given if delivered prepaid to the
Landlord, at the Landlord's address set out in Paragraph (h) of the Basic Terms,
and (b) if given by the Landlord to the Tenant shall be sufficiently given if
delivered prepaid to the Tenant's address set out in Paragraph (i) of the Basic
Terms, and every such notice is conclusively deemed to have been given upon the
date it was so delivered. If there is more than one Tenant, any notice required
or permitted by this Lease may be given by or to any one of them and has the
same force and effect as if given by or to all of them. Either party may give
written notice of any change of its address and thereafter the new address is
deemed to be the address of that party for the giving of notices.
Section 13.10 Registration.
The Tenant will not allow or cause this Lease to be registered. If
either party intends to register a document for the purpose only of giving
notice of this Lease or of any assignment or sublease of this Lease, then, upon
request, both parties will join in the execution of a short form or notice of
this Lease or any assignment or sublease which will (a) be prepared by the
Tenant or its solicitors and be subject to the approval of the Landlord at The
Tenant's expense, and (b) only describe the parties, the Leased Premises, the
Term, the Commencement Date, and any options to extend the Term. On or before
the expiry or earlier on of this Lease, the Tenant shall, at its expense, remove
from the title to the Lands, any short form or notice of this Lease registered
thereon.
Section 13.11 Accrual or Basic Rent and Additional Rent.
Rent will be considered as annual and accruing from day-to-day based
upon a three hundred and sixty-five (365) day calendar year and where it becomes
necessary for any reason to calculate Rent for an irregular period of less than
one (1) year, an appropriate apportionment and adjustment will be made.
Section 13.12 Compliance with the Planning Act.
It is a condition of this Lease that the subdivision control provisions
of the applicable legislation in force in the Province of Ontario from time to
time, be complied with if they apply. If the provisions of such legislation do
apply, then until any necessary consent to the Lease is obtained, the Term
(including any extensions thereof) and the Tenant's rights granted by this Lease
are deemed to extend for a period only of twenty-one (21) years less one (1) day
from the Commencement Date.
Section 13.13 Quiet Enjoyment.
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If the Tenant pays the Rent and observes and performs all its terms,
covenants and conditions, the Tenant will quietly hold and enjoy the Leased
Premises for the Term without interruption by the Landlord, unless otherwise
provided under this Lease.
IN WITNESS WHEREOF, the Landlord and the Tenant have signed and sealed
this Lease.
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SCHEDULE "A"
LEGAL DESCRIPTION
ALL AND SINGULAR that certain parcel or tract of land and premises situate,
lying and being in the City of North York, in the Municipality of Metropolitan
Toronto, composed of those parts of Block "D" according to a Plan registered in
the Land Registry Office for the Registry Division of Toronto Boroughs and York
South as Number 7612 designated as Part 1 on a plan of survey prepared by X.X.
Xxxxxx Limited dated July 26, 1979 and deposited in the said Land Registry
Office as Plan 64R-7908 and as Part 2 an a plan of survey prepared by X.X.
Xxxxxx Limited dated February 10, 1979, and deposited in the said Land Registry
Office as Plan 64R-7623.
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SCHEDULE "B"
PLAN OF THE 11TH FLOOR OF THE BUILDING
[FLOORPLAN]
The purpose of this plan is to identify the approximate location of the
Leased Premises in the Building. The Landlord reserves the right at any time to
relocate, rearrange, alter or expand any part of the Leased Premises from that
shown on this floor plan.
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SCHEDULE "C"
CONSTRUCTION OF THE LEASED PREMISES
II. For all other purposes of the Lease:
1. The Landlord shall finish the Leased Premises in the manner
standard to the Building which, without limiting the generality of the
foregoing, will include the following:
(a) for multi-tenancy floors, demising partitions
separating the Leased Premises from adjacent leasable premises, together with
the Landlord's standard entrance door and the Landlord's standard other door(s)
from the public corridor to the Leased Premises as by the appropriate
governmental authorities. The interior surfaces of the demising partitions will
be printed and ready to receive the Tenant's paint. It is understood that the
location of the demising partitions is subject to approval of the appropriate
governmental authorities;
(b) acoustic tile ceiling panels; and
(c) exposed T-bar dropped ceiling system, together
with r ed fluorescent lighting fixtures with original tubes and ballasts
installed.
2. (a) The Tenant shall pay to the Landlord as Additional
Rent, upon demand, the cost of any additional equipment supplied or work
performed by the Landlord specifically for the Tenant and any excess or
additional cost in the Landlord's Work occasioned by the Tenant's initial or
revised requests.
(b) The amount so payable shall be the total cost to
the Landlord and shall include (in addition to direct labour, materials and
applicable taxes), architectural and engineering fees, any costs attributable to
changes requested by the Tenant after approval of the Tenant's plans and
specifications by the Landlord, plus the Landlord's overhead and administrative
costs of fifteen percent (15%) of the total cost to the Landlord of such
equipment or work.
(c) Failure by the Tenant to pay any amounts due
under the provisions of this Schedule in the manner provided herein shall
constitute a default entitling the Landlord to its remedies under Section 12 of
this Lease and to retain for its own use without payment therefor, any Tenant's
Work which has been commenced or completed within the Leased Premises.
B. Tenant's Work.
1. Any alterations or construction not included as part of the
Landlord's Work and any changes desired by the Tenant which depart from the
Building's standard or which involve the use of materials not standard to the
Building are the Tenant's Work is subject to the Landlord's prior written
approval and shall be completed at the expense of the Tenant.
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2. The Tenant will supply and install window coverings as
specified by the Landlord or the Landlord will, at its option, supply and/or
install standard window coverings at the Tenant's expense.
3. Prior to commencing any Tenant's Work, the Tenant will
obtain, at its expense, the Landlord's approval of all the Tenant's plans and
specifications for the Tenant's Work and all permits, from the applicable
authorities, that are necessary for the commencement and completion of the
Tenant's Work. The Tenant will not apply for or obtain any such permits unless
and until the Landlord shall have approved, in writing, the Tenant's plans and
specifications for all aspects of the Tenant's Work.
4. The Tenant and its contractors are responsible to remove
garbage and debris from the Leased Premises daily and place same into garbage
containers provided for that purpose. All tenants will be assessed a portion, as
reasonably determined by the Landlord, of the cost of providing empty garbage
containers on the job site during the construction of their leased premises. Any
of the Tenant's garbage or debris removed by the Landlord's employees will by
charged to the Tenant's account and shall be payable as Additional Rent upon
demand.
5. The Tenant will pay to the Landlord upon demand (a) all
reasonable costs incurred by the Landlord with to supervision and administration
during the installation of the Leasehold Improvements, including without
limitations, supervision by mechanical, engineering and other consultants; (b)
all reasonable costs incurred by the Landlord in connection with the Tenant's
Work for vertical transport of workers and materials; and (c) all other costs
incurred by the Landlord in connection with the Tenant's Work.
6. Notwithstanding anything to the contrary, the Landlord may,
upon reasonable notice to the Tenant, require the Tenant to perform parts of the
Tenant's Work prior to the completion of the Landlord's Work. At the Landlord's
option, the Landlord or its contractors may perform all mechanical or electrical
work or any work which may affect the Structure to be done by or on behalf of
the Tenant with respect to the Leased Premises. The Tenant shall pay to the
Landlord upon demand as Additional Rent, all costs and expenses so incurred by
the Landlord or its contractors.
7. The Tenant shall pay to the Landlord as Additional Rent,
upon demand, an amount equal to One Dollar ($1.00) per square foot of the
Rentable Area of the Leased Premises, which amount shall be applied against
those amounts payable pursuant to Paragraphs 4 and 5 of this Schedule "C". The
Tenant may elect to have the Landlord perform all of the Tenant's Work at the
Tenant's cost and in such event, the Tenant shall pay to the Landlord as
Additional Rent, upon demand, the total cost incurred by the Landlord, plus the
Landlord's overhead and administrative costs of fifteen percent (15%) of the
total cost in lien of the aforesaid charge of One Dollar ($1.00) per square
foot.
C. Procedures.
1. The Landlord shall give the Tenant at least five (5) days'
prior notice of the date upon which possession of the Leased Premises will be
available to the Tenant with the Landlord's Work substantially completed or
completed to the extent that the Tenant's Work can
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be performed by the Tenant in conjunction with the Landlord's Work. The Tenant
shall, during the Fixturing Period, complete the Tenant's Work and cause its
employees and contractors to do their work so as not to interfere with the
Landlord's contractors and employees in the completion of the Landlord's Work.
2. The Tenant shall, prior to entering any portion of the
Building or the Leased Premises for the commencement of the Tenant's Work,
complete each of the following obligations to the Landlord's satisfaction:
(a) obtain the Landlord's written approval of the
Tenant's plans and specifications (three (3) sets of the plans and
specifications shall be given to the Landlord for its approval);
(b) provide the Landlord with certificates of
insurance in a form satisfactory to the Landlord, duly executed by the Tenant's
insurers evidencing that the insurance required to be placed by the Tenant
pursuant to this Lease has been obtained;
(c) ensure that all Tenant's Work is performed (i) by
competent workmen whose labour union affiliations are compatible with those
employed by the Landlord and its contractors in the Building; (ii) in a good and
workmanlike manner; and (iii) only during such hours as are designated by the
Landlord. All contractors shall be subject to the prior reasonable approval of
the Landlord;
(d) provide evidence satisfactory to the Landlord
that the Tenant has obtained at its expense all necessary consents, permits and
licenses from all appropriate governmental authorities. Should the Tenant fail
to obtain any such required consent, permit or license, the Landlord may, but
shall not be obliged to, obtain same on behalf of the Tenant, at the Tenant's
cost, payable as Additional Rent on demand, and the Landlord shall be entitled
to exercise any or all of the remedies contained in this Lease;
(e) provide evidence satisfactory to the Landlord of
the Tenant's work schedule for completion of Tenant's Work.
3. Notwithstanding anything to if the Landlord has been
impeded or delayed in completing the Landlord's Work in connection with the
Leased Premises or in making available the services which the Landlord is
obliged to furnish to the Leased Premises and if such impediment or delay has
been occasioned by the Tenant's delay in furnishing its plans or any other
information required by this Lease by the respective dates herein set out or by
any other failure of the Tenant to comply with any or the provisions of this
Lease, including the performance of the Tenant's Work (as to any and all of
which the Architect shall be the sole judge), then the Commencement Date shall
be conclusively deemed to be the date fixed by the Architect as the date when
the Fixturing Period would have commenced had the Landlord not been delayed by
the Tenant in completing the Landlord's Work as aforesaid. The Tenant shall not
be entitled to any abatement of Basic Rent or Additional Rent by reason of any
such delay in occupancy following such date so fixed by the Architect.
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D. Requirements after Performance of Tenant's Work.
The Tenant shall, upon completion of the Tenant's Work and if requested
by the Landlord:
1. Provide the Landlord with statutory declarations of the
head contractor and one of the Tenant's officers (the "declaration"):
(a) stating that the Tenant's Work has been performed
strictly in accordance with the plans and specifications approved by the
Landlord and this Schedule "C" and that all deficiencies (if any) which the
Landlord has brought to the Tenant's attention have been corrected;
(b) stating that there are no construction liens or
other liens or encumbrances registered or otherwise outstanding against the
Leased Premises, the Building or the Lands in respect of work, services or
materials relating to the Tenant's Work and that all accounts for work, services
or materials have been paid in full with respect to all of the Tenant's Work;
(c) listing each contractor and subcontractor who did
work or provided materials in connection with the Tenant's Work; and
(d) confirming the date on which the last work was
performed and materials were supplied.
2. Provide to the Landlord an itemized list certified
by the Tenant showing the costs actually expended by the Tenant for the
completion of the Tenant's Work.
3. Provide to the Landlord a clearance certificate
issued under the Worker's Compensation Act in respect of each contractor and
subcontractor listed on the declaration.
4. Obtain and provide to the Landlord a copy of every
occupancy and other permit which may be required by any governmental or other
regulatory authority having jurisdiction, to permit the Tenant to open for
business.
5. Provide the Landlord with a certificate of a
professional engineer or architect acceptable to the Landlord, certifying that
the Tenant's Work has been carried out in accordance with the plans and
specifications as approved by the Landlord, the Architect and the Landlord's
engineering consultants.
E. Liens.
The Tenant shall ensure that no construction liens or other liens or
encumbrances in respect of materials supplied or work done or to be done by the
Tenant or on behalf of the Tenant or related to the Tenant's Work shall be
registered against or shall otherwise affect the Lands or the Landlord's or the
Tenant's interest in the Lands.
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SCHEDULE "D"
METHOD OF FLOOR MEASUREMENT
The following sets out the various methods of measuring areas in the
Building.
(a) Office Areas - Single Tenancy Floors
Both the Rentable Area and the Usable Area of a floor in the Building
occupied by a tenant shall be calculated by measuring the area within the
outside face of the exterior building walls and glass. It shall include all
space within the said area except the stairwells (unless installed for the
exclusive benefit of a tenant occupying leased premises on more than one floor
of the Building), elevator shafts, flues, stacks, pipe shafts, vertical ducts,
other vertical risers which penetrate the floor and the walls enclosing such
excepted areas. No deduction shall be made for washrooms, janitor closets,
air-conditioning rooms, fan rooms, electrical, telephone or other rooms and
closets within and servicing only that floor or servicing a single tenant on
more than one floor, corridors, elevator lobbies, service elevator lobbies, any
enclosures on the perimeter of the Building used for the purposes of cooling,
heating or ventilating or for any columns or projections forming part of the
Structure of the Building.
(b) Office Areas - Multiple Tenancy Floors
The Usable Area of leasable premises on a multiple tenancy floor (other
than the ground floor) shall be calculated by measuring the area within the
outside face of the exterior building walls and glass, the outside face of walls
separating the leasable premises from common corridors and the centre of walls
separating the leasable premises from adjacent leasable premises, including any
enclosures on the perimeter of the Building used for the purposes of cooling,
heating or ventilating, and all columns or projections forming part of the
Structure of the Building. If leasable premises have any recessed doorway,
vestibule or other area which may be set back from the predetermined lease line,
the area of such recess for all purposes lies within the Usable Area of the
Leased Premises.
The Rentable Area of leasable premises on a multiple tenancy floor
shall be the Usable Area of such leasable premises multiplied by a fraction, the
numerator of which shall be the Rentable Area of that floor calculated on the
basis of a single tenancy, and the denominator of which shall be the sum of the
Usable Areas of all leasable premises on that floor.
(c) Ground Floor Areas
The Rentable Area of ground floor leasable premises shall be calculated
by measuring the area within the outside face of the exterior buildings walls
and glass, the outside face of walls separating the leasable premises from
common corridors, the centre of walls separating the leasable premises from
adjacent leasable premises and the predetermined lease line where the leasable
premises face onto an interior public corridor or lobby area. No deduction shall
be made for vestibules inside the permanent exterior building walls or the
predetermined lease line, enclosures on the perimeter of the leasable premises
used for the purpose of cooling, heating or ventilating and columns or
projections forming part of the Structure of the Building. If ground floor
leasable premises are served by a corridor, mechanical room, loading dock or
other service area (the "Service Area"), the Rentable Area of such leasable
premises shall include the area
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calculated by multiplying the Rentable Area of the Service Area by a fraction,
the numerator of which shall be the Rentable Area of such leasable premises and
the denominator of which shall be the sum of the Rentable Areas of all leasable
premises served by the Service Area.
(d) Multi-floor Leased Premises
If any leasable premises are located on more than one floor of the
Building then that part of such leasable premises on each floor shall be
measured separately in accordance with the above provisions and the Rentable
Area of such leasable premises shall be the aggregate of the Rentable Areas of
such leasable premises on each floor of the Building.
(e) Storage Areas
The Rentable Area of leasable premises comprising the Storage Areas
shall be calculated in the same manner as is provided for the calculation of the
Rentable Area of ground floor leasable premises.
(f) Rentable Area of the Building
The Rentable Area of the Building shall be the aggregate of the
Rentable Area of each office floor above grade calculated on the basis that it
is a single tenancy floor together with the Rentable Area of each of the
leasable premises on the ground floor.
The Rentable Area of the Building shall:
(i) exclude public lobbies and walkways on the ground
floor and all Storage Areas; and
(ii) be adjusted from time to time to reflect any
changes, additions or improvements to the Building.
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SCHEDULE F
RULES AND REGULATIONS
1. The Tenant will not place or permit any debris, garbage, trash or
refuse (collectively, "trash") to be placed or left in or upon any part of the
Building outside of the Leased Premises. The Tenant will not remove from the
Leased Premises or dispose of any trash other than in the manner and at the
times prescribed by the Landlord. If the Leased Premises are part of the Retail
Area: (a) the Tenant will keep any trash in ratproof containers (and if the
Landlord requires, in refrigerated containers) within the interior of the Leased
Premises until removed; (b) the Tenant will not permit undue accumulations of
trash in the Leased Premises; and (c) the Tenant will remove all trash from the
Leased Premises at the Tenant's expense, on a regular basis, in the manner and
at the times prescribed by the Landlord.
2. The Landlord will permit the Tenant and the Tenant's employees and
all Persons lawfully requiring communication with them to have the use during
Normal Business Hours of the main entrance and the stairways, corridors,
elevators, if any, or other mechanical means of access leading to the Leased
Premises. At times other than during Normal Business Hours the Tenant and its
employees will have access to the Building and to the Leased Premises only in
accordance with the Rules and Regulations and will be required to identify
themselves satisfactorily and to register in any book which the Landlord may
keep for that purpose. The Tenant is not permitted to move in or out of the
Leased Premises during Normal Business Hours.
3. The Tenant and its employees may use the washrooms, if any, on the
Tenant's floor of the Building.
4. If the Leased Premises are part of the Office Area, the Tenant will
allow window cleaners to have access to the Leased Premises during Normal
Business Hours to clean the windows of the Leased Premises.
5. The sidewalks, entrances, passages, elevators and staircases will
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
Leased Premises or the Building.
6. The Tenant, its agents, servants, contractors, invitees or
employees, will not bring in or take out, position, construct, install or move
any safe or other heavy machinery, equipment or furniture or anything which is
likely to injure or destroy any part of the Building without first obtaining the
Landlord's written consent. The Landlord will have the right to prescribe the
weight permitted and the position thereof, and the use and design of planks,
skids or platforms, to distribute weight. The Tenant will repair, at its
expense, all damage caused to the Building in so moving or using any heavy
equipment or other office equipment or furniture. The moving of all heavy
equipment or other office equipment or furniture will occur only by prior
arrangement with the Landlord. No Tenant will employ anyone to do its moving in
the Building other than staff of the Building, unless permission to employ
anyone else is given by the Landlord and the reasonable cost of such moving will
be paid by the Tenant. Safes and other heavy office equipment and machinery will
be moved through the halls and corridors only upon steel bearing
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plates. No freight or bulky matter of any description will be received into the
Building or carried in elevators except during hours approved by the Landlord.
7. The Tenant will not place or cause to be placed any additional locks
upon any doors of the Leased Premises without the approval of the Landlord and
subject to any conditions imposed by the Landlord.
8. The Tenant will not permit any cooking of any food or liquids in the
Leased Premises without the written consent of the Landlord.
9. Canvassing, soliciting and peddling in or about the Building are
prohibited.
10. The Tenant will not place or maintain any supplies, merchandise or
other articles in or otherwise obstruct any vestibule or entry of the Leased
Premises, or the footwalks adjacent thereto or elsewhere on the exterior of the
Leased premises or elsewhere in the Building including, without limitation
elevators, hallways or stairwells.
11. The Tenant will not permit or allow any odors, vapors, steam,
water, vibrations, noises or other undesirable effects to emanate from the
Leased Premises or any equipment or installation therein, which in the
Landlord's opinion, are objectionable or cause any interference with the safety,
comfort or convenience of the Building for the Landlord or the occupants and
tenants thereof or their agents, servants, invitees or employees. The Tenant
will keep all mechanical apparatus free of vibration and noise which may be
transmitted beyond the Leased Premises.
12. The Tenant will use only the window coverings specified by the
Landlord and will not install or permit to be installed on or adjacent to the
windows in the Leased Premises any other window coverings or shades of any type
whatsoever whether or not visible from the outside of the Building, including,
without limitation, drapes, curtains, blinds or shades.
13. The Tenant shall not receive or ship fixtures, equipment or
articles of any kind whatsoever except through facilities, doors and elevators
designated by the Landlord and at hours prescribed by the Landlord and under the
supervision of the Landlord, its agents or employees.
14. The Tenant shall not obstruct or otherwise interfere with the
heating, air-conditioning or ventilation units contained in the Building.
15. The Tenant will not permit any of its servants, invitees, employees
or agents to bring upon the Building or the Leased Premises any animals or
bicycles.
16. The Tenant will keep the Leased Premises free of insects, rodents,
vermin and other pests and, if the Landlord requires, retain the services of a
pest extermination contractor designated by or acceptable to the Landlord, at
the Tenant's expense.
17. The Tenant will not use the Leased Premises for lodging, sleeping
or any illegal purpose.
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SCHEDULE "F"
DEFINITIONS
In this Lease and in the Schedules to this Lease the following
definitions are applicable:
1. "Additional Rent" means all sums of money or charges required to be
paid by the Tenant under this Lease (except Basic Rent and Sales Taxes) whether
or not designated "Additional Rent" or payable to the Landlord.
2. "Alterations" means any repairs, replacements, decorations,
Leasehold Improvements or other alterations made by or on behalf of the Tenant
to any part of the Leased Premises.
3. "Architect" means the architect, surveyor or space planner from time
to time named by the Landlord. The decision of the Architect whenever required
by this Lease (or requested by the Landlord) and any certificate prepared or
approved by the Architect will be final and binding.
4. "Basic Rent" means the sums payable by the Tenant to the Landlord as
set out in Section 3.2.
5. "Building" means the multi-storey office building erected or to be
erected on the Lands and located in the City of Toronto, Province of Ontario,
known municipally as 0 Xxxxxxx Xxxxxx, from and including the lowest floor or
level of the Building to and including the roof thereon, the Common Areas and
Facilities, the Parking Garage, the Storage Areas, and the areas and facilities
serving the Building, as determined by the Landlord, which areas and facilities
may include, without limitation, lobbies, foyers and vestibules, sidewalks,
storage and mechanical areas, janitor rooms, mail rooms, telephone, mechanical
and electrical rooms, stairways, escalators, elevators, truck and receiving
areas, driveways, loading docks and corridors and shall also include the Retail
Area, the Office Area and those areas designated or intended by the Landlord to
be leased or used for service, administration, management, safety and
operational purposes.
6. "Business Taxes" means business taxes, license fees, personal
property taxes or other similar assessments, taxes, rates or levies imposed by
any taxing authority, in respect of any assets located in, use, enjoyment or
occupancy of, or business carried on in the Leased Premises or any other portion
of the Property.
7. "Capital Tax" is an amount determined by multiplying each of the
"Applicable Rates" by the "Capital" and totaling the products. "Capital" is the
amount of capital which the Landlord determines, without duplication, that is
from time to time invested by the Landlord, the Owners or all of them, in
acquiring, developing, expanding, redeveloping and improving the Property.
Capital will not be increased by any financing or refinancing except to the
extent that the proceeds are spent or invested directly as Capital. An
"Applicable Rate" is the capital tax rate specified from time to time under any
statute of Canada and any statute of the Province which imposes a tax in respect
of the capital of corporations. Each Applicable Rate will be considered to be
the rate that would apply if none of the Landlord or the Owners employed
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capital outside of the Province. Where part of the capital of the Landlord or
the Owners (or corporations that are considered to be related to or associated
with any of them) is not taxable under a statute referred to above, that
non-taxable capital will be apportioned by the Landlord and the Owners among
each of their respective assets and the assets of the related or associated
corporations for the purpose of determining Capital.
8. "Common Areas and Facilities" means (a) those areas, facilities,
utilities, improvements, equipment and installations in the Building which, from
time to time, are not designated or intended by the Landlord to be leased to
tenants of the Building, and (b) those areas, facilities, utilities,
improvements, equipment and installations which serve or are for the benefit of
the Property, whether or not located within, adjacent to, or near the Building
and which are designated from time to time by the Landlord as part of the Common
Areas and Facilities, including, without limitation, all areas, facilities,
utilities, improvements, equipment and installations which are provided or
designated from time to time by the Landlord for the. use or benefit of the
tenants of the Building, their employees, customers and other invitees in common
with others entitled to their use and benefit.
9. "Fixtures" means all furniture, trade fixtures and equipment
installed by the Tenant in the Leased Premises and not affixed in any manner
thereto.
10. "Fixturing Period" means the period described in Paragraph (c) of
the Basic Terms.
11. "Indemnifier" means the Person who has executed or agreed to
execute the Indemnity Agreement that is attached to this Lease as Appendix "A".
12. "Landlord" means the party of the First Part and, in sections that
contain a release or other exculpatory language in favor of the Landlord,
includes its officers, directors, employees (while in the ordinary course of
their employment) and agents.
13. "Landlord's Work" means all construction and other work referred to
as "Landlord's Work" in Schedule "C" of this Lease.
14. "Lands" means the lands underneath, adjacent and appurtenant to the
Building, as more particularly described in Schedule "A" attached to this Lease
or as such Lands may be altered, expanded or reduced from time to time.
15. "Lease" means this agreement and all the terms, covenants and
conditions set out herein, as amended from time to time in accordance with
Section 13.2(c).
16. "Lease Year" means a period of twelve (12) consecutive calendar
months, and in the case of the first Lease Year, if the Commencement Date is not
the first day of a calendar month, plus that portion of the month between the
Commencement Date and the last day of the month in which the Commencement Date
occurs, inclusive. The last Lease Year shall terminate on the expiration or
earlier termination of this Lease.
17. "Leased Premises" means the premises demised by this Lease.
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18. "Leasehold Improvements" means all items generally considered as
leasehold improvements, excluding any Fixtures but including without limitation
all installations, alterations and additions from time to time made, erected or
installed in the Leased Premises by or on behalf of the Tenant, or any previous
occupant of the Leased Premises or any portion thereof including, without
limitation, all partitions however affixed and whether or not moveable, hearing,
ventilating and air-conditioning systems, facilities and equipment, light
fixtures, internal stairways and doors, and floor, wall and ceiling coverings.
19. "Market Rental" means, at any given time, the then current fair
market net rental rate for net leases with similar terms (including, without
limitation, the length of the term and the frequency of adjustments in rent, if
any) entered into at arm's length for premises of similar size, age, quality and
use, similarly improved and fixtured in similar office buildings in the City of
Toronto, Province of Ontario.
20. "Mortgagee" means any mortgagee or chargee (including any trustee
for bondholders), from time to time, of the Property or any part thereof, or of
the Landlord's interest in the Property.
21. "Normal Business Hours" means the hours from 8:00 a.m. to 6:00 p.m.
on Mondays to Fridays unless such a day is a statutory holiday.
22. "Office Area" means the aggregate of all portions of the Building
from time to time designated by the Landlord for office purposes as from time to
time altered, improved, reduced or expanded by the Landlord.
23 (a). "Operating Costs" means the total animmis incurred, paid or
payable by or on behalf of the Landlord for the maintenance, operation, repair,
replacement, management and administration of the Building and the Property,
calculated as if the Building were at all times fully occupied and operational.
(b) Operating Costs include, without limitation and without
duplication, the aggregate of:
(i) the total annual costs of insuring the Building and the
improvements and equipment and other property servicing the Building from time
to time as the Landlord, or the Mortgagee, from time to time determines;
(ii) the cost of cleaning (including carpet cleaning in the Common
Areas and Facilities and window cleaning), snow removal, garbage and waste
collection and disposal and pest control, including the cost of performing the
work referred to in Section 5.2(a), and the cost of security, supervision and
traffic control;
(iii) the cost of Utilities used in maintaining, operating, heating,
ventilating and air-conditioning the Building including all leasable premises
therein, except to the extent separately metered and paid for directly by
individual tenants;
(iv) salaries, wages and other amounts (including management fees and
contributions and premium for fringe benefits, unemployment insurance, pension
plans, Workers'
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Compensation and other similar contributions and premiums) paid or payable for
all management, supervisory, and operational personnel including the Building
manager, engineers, janitors, caretakers, security staff, management and all
other related personnel (in each case, whether employed by the Landlord or
pursuant to a third party management contract), engaged in the repair, care,
maintenance, security, management and cleaning of the Property;
(v) the cost of the rental of any equipment and signs, and the cost of
supplies, used in the maintenance and operation of the Property;
(vi) audit fees and the cost of accounting services incurred in the
preparation of the statements referred to in this Lease and the financial
statements related thereto, and in the computation of the rents and other
charges payable by tenants of the Building;
(vii) the cost of all repairs and replacements (including repairs and
replacements which are structural in nature or which are considered capital
items in accordance with generally accepted accounting principles) to and
maintenance (including, without limitation, landscaping maintenance) and
operation of the Property and the systems, facilities and equipment serving the
Building and all repairs and replacement undertaken by the Landlord for the
general safety and benefit of the tenants of the Building or to reduce Operating
Costs, and the cost of installing energy conservation equipment and systems and
safety or life support systems in the Building or on the Property;
(viii) depreciation or amortization over the economic life, together
with interest on the undepreciated or unamoritized portion calculated at two (2)
percentage points above the Prime Rate, of the, costs, including repairs and
replacements, of the maintenance, cleaning, operating, heating, ventilating and
air-conditioning equipment, master utility meters and all other fixtures,
equipment and facilities comprising the Common Areas and Facilities, which in
accordance with generally accepted accounting principles, are not fully expensed
or deducted in the fiscal period in which they are incurred;
(ix) all Business Taxes, if any, from time to time payable by the
Landlord with respect to the Building or the Property, and Capital Tax;
(x) the Market Rental attributable to premises occupied for management,
supervisory or administrative purposes in connection with the Building or the
Property including, without limitation, premises leased or used for service,
administration, management, safety and operational purposes; and
(xi) an administration fee of fifteen percent (15%) of the costs
referred to above in this Paragraph 23.
From the total of the above costs, there shall be deducted or excluded,
as the case may be:
(aa) all net recoveries which reduce Operating Costs received by the
Landlord from tenants as a result of any act, omission, default or negligence of
such tenants or by reason of a breach by such tenants under clauses in their
respective leases requiring their contribution to Operating Costs);
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(bb) net proceeds received by the Landlord from insurance policies
taken out by the Landlord to the extent that the proceeds relate to Operating
Costs;
(cc) ground rent payable to any ground lessor if the Landlord is not
the owner of the Lands and principal and interest payments on any mortgages,
charges or other encumbrances registered against the title of the Property;
(dd) all net recoveries by the Landlord in respect of warranties or
guarantees relating to the construction of the Building or any portion thereof,
to the extent that repair costs in respect of the work covered by warranty or
guarantee are included in Operating Costs;
(ee) contributions, if any, to the cost of maintaining and operating
the Storage Areas made by tenants or occupants of such premises;
(ff) costs and expenses relating to the leasing of space or premises in
the Building including leasing commissions, legal fees and advertising costs;
and
(gg) contributions, if any, to the cost of the excess supply, to the
Tenant or other tenants of the Building, of Utilities used in maintaining,
operating, heating, ventilating and air-conditioning the Building.
24. "Owners" means the registered owns and holders of the freehold or
leasehold title of the Property or any part thereof from time to time. In
sections that contain a release or other exculpatory language in favor of the
Owners, "Owners" includes the officers, directors, employees (while in the
ordinary course of their employment) and agents of the Owners.
25. "Parking Garage" means all parking facilities, if any, located
within or adjacent to the Building or the Property, as they may from time to
time be altered, improved, reduced or expanded by the Landlord in its sole
discretion, including without limitation all entrances and exits thereto, access
ramps and any delivery passages located therein.
26. "Person", if the context allows, includes any person, firm,
partnership or corporation, or any group of persons, firms, partnerships or
corporations or any combination thereof.
27. "Prime Rate" means the commercial lending rate of interest,
expressed as an annual rate, that any chartered bank or trust company of the
Landlord quotes from time to time at its principal office in Canada as the
reference rate of interest (which is commonly known as its "prime rate"), and
which serves as the basis upon which effective rates of interest are calculated
for Canadian dollar loans made in Canada to its commercial customers with
interest payable as a function of its prime rate.
28. "Property" means the Building and the Lands.
29. "Proportionate Share" means a fraction which has as its numerator
the Rentable Area of the Leased Premises and as its denominator the Rentable
Area of the Building.
30. "Rent" means Basic Rent and Additional Rent.
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31. "Rentable Area" means the rentable area calculated in accordance
with the provisions of Schedule "D".
32. "Retail Area" means those portions of the Building, if any, located
on the ground floor of the Building and from time to time designated by the
Landlord for retail commercial purposes, as from time to time altered, improved,
reduced or expanded by the Landlord in its sole discretion.
33. "Rules and Regulations" means the rules and regulations described
in Section 13.1.
34. "G.S.T." means the amounts payable by the Tenant in accordance with
Section 4.3(c).
35. "Storage Areas" means those portions of the Building, if any, from
time to time designated by the Landlord for storage purposes, as from time to
time altered, improved, reduced or expanded by the Landlord in its sole
discretion.
36. "Structure" means the foundations, roof (including the roof
membrane), exterior wall assemblies including weather walls and bearing walls,
sub floor and structural columns and beams of the Building and any other
portions of the Building designated by the Landlord from time to time as
Structure.
37. "Taxes" means all real property and commercial concentration taxes,
rates, duties and assessments (including local improvement taxes), imposts,
charges or levies, whether general or special, that are levied, rated, charged
or assessed against the Property or any part thereof or Rent there from from
time to time by any lawful taxing authority, whether federal, provincial,
municipal, school or otherwise, and any taxes or other amounts which are imposed
in lieu of, or in addition to, any such real property or commercial
concentration taxes whether of the foregoing character or not and whether in
existence at the Commencement Date or not, and any such real property or
commercial concentration taxes levied or assessed against the Landlord or the
Owners on account of their interest in or ownership of the Property or any part
thereof, calculated on the basis of the Building being assessed as a fully
leased and operational building, and the costs and expenses incurred for
consulting, appraisal, legal and other services to the extent they are incurred
in an attempt to minimize or reduce any of the real property or commercial
concentration taxes referred to above.
38. "Tenant" means the party of the Second Part and if the Tenant is an
individual, his heirs, executors and administrators, and in every case, its
permitted successors and assigns. Any reference to "Tenant" includes, where the
context allows, the servants, employees, agents, invitees and licensees of the
Tenant and all others over whom the Tenant may reasonably be expected to
exercise control.
39. "Tenant's Work" means all construction and other work required to
be provided or performed in order to render the Leased Premises complete and
suitable to open for business, including without limitations, all work
designated as Tenant's Work in Schedule "C" of this Lease, but excluding those
items specifically referred to as "Landlord's Work".
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40. "Term" means the period described in Paragraph (b) of the Basic
Terms.
41. "Usable Area" means the usable area calculated in accordance with
the provisions of Schedule "D".
42. "Utilities" means all gas, electricity, water, sewer, steam, fuel,
power, telephone and other utilities used in or for or allocated by the Landlord
to the Building or the Leased Premises, as the case may be.
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APPENDIX "B"
SPECIAL PROVISIONS
(a) Special Provisions (IF APPLICABLE):
RENT FREE PERIOD
Notwithstanding anything to the contrary, Basic Rent shall not accrue
or be payable during the first four (4) months of the Term. The Tenant shall,
however, during such periods throughout the Term, be obligated to pay all
amounts due hereunder as Additional Rent and any other charges payable under
this Lease.
AS IS
The Tenant shall accept the Leased Premises from the Landlord in an "as
is" condition and the Landlord shall not be required to do any work of any kind
in the Leased Premises in order to prepare them for the Tenant's use and
occupancy, save and except that the Landlord warrants and represents that all
services provided to the Leased Premises by the Landlord (Heating,
Air-conditioning etc.) will be free from any defects. In the event that any
defects occur, Landlord hereby undertakes to repair such defects forthwith upon
notification by the Tenant.
COMMENCEMENT DATE AND ADVANCED OCCUPANCY
Notwithstanding the Commencement Date set out herein, the Landlord may
advance the Commencement Date by giving written notice to the Tenant of the
Advanced Commencement Date to the Tenant at least 30 days prior to same.
PARKING
The Tenant shall have the use of the surface parking lot designated for
the Building based on the ratio of three (3) stalls per 1,000 square feet leased
throughout the Term of the Lease at no additional cost to the Tenant.
RESTORATION
Notwithstanding anything contained herein, the Tenant shall not be
responsible for restoration of the Leased Premises or removal of the existing or
approved leasehold improvements in the Leased Premises (save for Tenant's trade
fixtures) at the expiry of the lease term or any extensions; however, this does
not absolve the Tenant's responsibility to repair damage and maintain the Leased
Premises in good repair as outlined herein.
MEASUREMENT
Prior to the Commencement Date, the Landlord warrants and represents
that is shall provide a Certificate of Measurement from the Landlord's architect
or certified space planner verifying the Rentable Area of the Leased Premises
and the Rent shall be adjusted accordingly.
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It is understood and agreed that the Rent payable hereunder shall be
payable on the Rentable Area measured in accordance with BOMA industry
standards.
EXTENSION OF TERM
If:
(i) the Tenant pays the Rent as and when due and punctually observes
and performs its covenants, obligations and agreements under and in accordance
with the terms of this Lease;
(ii) the Tenant is not in breach or default under the terms of this
Lease;
(iii) the Tenant gives the Landlord not less than six (6) months notice
prior to the expiry of the initial Term of its intention to extend the Term; and
(iv) the Tenant is XxXxxx.xxx, Inc. and is itself in occupation of and
conducting business in the whole of the Leased Premises;
then the Tenant will have the right Lo extend the Term upon the expiry
of the initial Term for one further period of two (2) years (the "Extended
Term") upon the same terms and conditions as are set out in this Lease, except
that:
(v) there will be no further right to extend the Term;
(vi) any Fixturing Period, or requirement on the Landlord's part to do
any Landlord's Work or pay to the Tenant any construction allowance, inducement,
loan or other amount in connection with this Lease or improvements installed in
the Leased Premises, set out in this Lease, shall not apply to the Extended
Term;
(vii) if the Landlord requires, the Tenant will promptly execute an
extension agreement prepared by the Landlord at the Tenant's expense, giving
effect to the Extended Term; and
(viii) the annual Basic Rent shall be mutually agreed upon between the
Landlord and the Tenant based upon the Market Rental of the Leased Premises,
provided that the Basic Rent shall in no event be less than the annual Basic
Rent payable by the Tenant for the last twelve (12) months of the initial Term;
and provided further that if the parties are unable to agree as to such Basic
Rent by no later than three (3) months prior to the expiry of the initial Term,
then the Basic Rent shall be determined by arbitration in accordance with the
Arbitrations Act of Ontario. If the annual Basic Rent has not been determined by
the commencement of the Extended Term, the Tenant shall pay Basic Rent at the
rate applicable to over holding as set out in Section 13.3, and within ten (10)
days after the Basic Rent for the Extended Term is determined, the Tenant shall
pay to the Landlord any amount retroactively owing from the commencement of the
Extended Term.]
If the Tenant fails to exercise the foregoing option to extend the Term
in accordance with this Section of Appendix "B", or if the other conditions set
out in this Section of Appendix "B" are not satisfied, this option to extend
shall be null and void.
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