EXHIBIT 10.19
INDUSTRIAL
LEASE AGREEMENT
000 XXXXXXXX XXXXX
XXXXXXX, XXXXXXX
BETWEEN
PENREAL PROPERTY FUND LTD.
(THE LANDLORD)
AND
XXXXXXX SYSTEMS CANADA, LTD.
(THE TENANT)
Lease Commencement: July 1, 1997
TABLE OF CONTENTS
ARTICLE DESCRIPTION
1. DEFINITIONS
1.1. ADDITIONAL RENT
1.2. ALTERATIONS
1.3. ARCHITECT
1.4. BUILDING
1.5. BUSINESS TAX
1.6. CAPITAL TAX
1.7. CHANGE OF CONTROL
1.8. COMMENCEMENT DATE
1.9. COMMON AREAS
1.10. GROSS RENTABLE AREA
1.11. GROSS RENTABLE AREA OF THE BUILDING
1.12. "INCLUDING" AND "INCLUDES
1.13. INDEMNIFIER
1.14. LANDS
1.15. LEASEHOLD IMPROVEMENTS
1.16. MORTGAGE
1.17. MORTGAGEE
1.18. NET RENT
1.19. OFFER TO LEASE
1.20. OPERATING COSTS
1.21. PERSON
1.22. PREMISES
1.23. PROPERTY
1.24. PROPORTIONATE SHARE
1.25. RENT
1.26. RENTAL YEAR
1.27. RULES AND REGULATIONS
1.28. SALES TAX
1.29. STRUCTURAL REPAIRS
1.30. TAXES
1.31. TENANT
1.32. TERM
1.33. TRANSFER
1.34. TRANSFEREE
2. TERM AND USE
2.1. GRANT AND PREMISES
2.2. TERM
2.3. CONSTRUCTION OF PREMISES
2.4. USE
2.5. TENANT'S COVENANTS AS TO USE AND OCCUPANCY
2.6. ENVIRONMENTAL
3. RENT
3.1. COVENANT TO PAY
3.2. NET RENT
3.3. ADDITIONAL RENT
3.4. RENTAL DEPOSIT
3.5. SECURITY DEPOSIT
3.6. PAYMENT OF TAXES AND OPERATING COSTS
3.7. RENT & ADDITIONAL RENT PAST DUE
3.8. NET LEASE
3.9. UTILITIES
3.10. HEATING, VENTILATING AND (IF APPLICABLE) AIR-CONDITIONING UNITS
4. MAINTENANCE, REPAIRS AND COMMON AREAS
4.1. TENANT'S OBLIGATIONS
4.2. LANDLORD'S OBLIGATIONS
4.3. APPROVAL OF TENANT'S ALTERATIONS
4.4. REPAIR WHERE TENANT AT FAULT
4.5. REMOVAL OF IMPROVEMENTS AND FIXTURES
4.6. LIENS
4.7. NOTICE BY TENANT
4.8. NO LANDLORD'S LIABILITY
5. CONTROL OF PROPERTY BY LANDLORD
5.1. ALTERATIONS BY LANDLORD
5.2. RIGHT OF EXAMINATION
5.3. RIGHT TO SHOW PREMISES
5.4. ENTRY NOT FORFEITURE
5.5. MAINTENANCE SCHEDULE
6. INSURANCE AND INDEMNITY
6.1. TENANT'S INSURANCE
6.2. LANDLORD'S INSURANCE
6.3. INDEMNIFICATION OF THE LANDLORD
6.4. LOSS OR DAMAGE
6.5. INCREASE IN INSURANCE PREMIUMS
6.6. CANCELLATION OF INSURANCE
7. ASSIGNMENT AND SUBLETTING
7.1. TRANSFERS
7.2. LANDLORD'S RIGHT TO TERMINATE
7.3. CONDITIONS OF TRANSFER
7.4. CHANGE OF CONTROL
7.5. NO ADVERTISING
7.6. ASSIGNMENT BY THE LANDLORD
7.7. PERMITTED TRANSFERS
8. DAMAGE, DESTRUCTION AND EXPROPRIATION
8.1. LANDLORD'S OPTION
8.2. DAMAGE To PREMISES
8.3. LANDLORD'S PLANS
8.4. ARCHITECT'S CERTIFICATE
9. DEFAULT
9.1. DEFAULT AND REMEDIES
9.2. DISTRESS
9.3. COSTS
9.4. ALLOCATION OF PAYMENTS
9.5. SURVIVAL OF OBLIGATIONS
9.6. ADDITIONAL RENT DEEMED RENT
9.7. LANDLORD'S RIGHT To PERFORM
10. STATUS STATEMENT; ATTORNMENT AND SUBORDINATION
10.1. STATUS STATEMENT
10.2. SUBORDINATION
10.3. ATTORNMENT
10.4. EXECUTION OF DOCUMENTS
11. GENERAL PROVISIONS
11.1. QUIET ENJOYMENT
11.2. RULES AND REGULATIONS
11.3. DELAY
11.4. OVERHOLDING
11.5. WAIVER
11.6. REGISTRATION
11.7. NOTICES
11.8. SUCCESSORS & ASSIGNS
11.9. JOINT AND SEVERAL LIABILITY
11.10.CONSENT
11.11.SIGNS
11.12.ACCORD AND SATISFACTION
11.13.OCCUPANCY PERMIT
11.14.SCHEDULES
11.15.ENTIRE AGREEMENT
SCHEDULE "A" LEGAL DESCRIPTION AND SITE PLAN
SCHEDULE "B" RULES AND REGULATIONS
SCHEDULE "C" SPECIAL PROVISIONS
INDUSTRIAL
LEASE AGREEMENT
000 XXXXXXXX XXXXX
THIS LEASE is dated the 13th day of June, 1997.
BETWEEN: PENREAL PROPERTY FUND LTD. (HEREINAFTER CALLED
THE "LANDLORD")
c/o Penreal Advisors Ltd.
00 Xxxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxx
X0X 0X0
OF THE FIRST PART
AND: XXXXXXX SYSTEMS CANADA, LTD. (HEREINAFTER CALLED
THE "TENANT")
000 Xxxxxxxx Xxxxx
Xxxx 0
Xxxxxxx, Xxxxxxx
X0X 0X0
OF THE SECOND PART
ARTICLE 1
1. DEFINITIONS
In this lease and in the schedules attached to this lease:
1.1. ADDITIONAL RENT
"Additional Rent" means all sums of money required to be paid by the Tenant
under this lease (except Net Rent).
1.2. ALTERATIONS
"Alterations" means all repairs, replacements, alterations or additions to the
Premises by or on behalf of the Tenant which are made after the completion of
the initial Leasehold Improvements, being that work which is required to be
completed to make the Premises ready for the initial use and occupancy of the
Tenant, which work is scheduled to be completed on or about January, 1998
("Initial Leasehold Improvements").
1.3. ARCHITECT
"Architect" means the accredited, independent architect from time to time named
by the Landlord.
1.4. BUILDING
"Building" means the industrial building located on the Lands and municipally
known as:
000 XXXXXXXX XXXXX (HEREINAFTER CALLED
THE "BUILDING")
Markham, Ontario
1.5. BUSINESS TAX
"Business Tax" means all business taxes attributable to the business of the
Tenant or any other occupant of the Premises.
1.6. CAPITAL TAX
"Capital Tax" means the amount imputed by the Landlord to the Property for
taxes, rates, duties and assessments imposed from time to time upon the Landlord
and payable by the Landlord on account of the capital invested in the Property.
1.7. CHANGE OF CONTROL
"Change of Control" means, in the case of any corporation or partnership, the
change in the effective control of such corporation or partnership unless such
change occurs as a result of trading in the shares of a corporation listed on a
recognized stock exchange in Canada or the United States.
1.8. COMMENCEMENT DATE
"Commencement Date" means the commencement of the Term under Section 2.2.
1.9. COMMON AREAS
"Common Areas" means those areas, facilities, and improvements designated from
time to time by the Landlord for the common use of all tenants.
1.10. GROSS RENTABLE AREA
"Gross Rentable Area" means, with respect to rentable premises in the Building,
the area in square feet of all space in such premises, and measured from the
exterior face of all exterior walls, doors and windows, to the centre line of
partitions separating rentable premises from each other and to the outside of
partitions separating rentable premises from interior enclosed corridors in the
Building (if any). Such area of rentable premises shall include all areas such
as enclosed vestibules and enclosed or roofed shipping and receiving areas,
whether or not recessed within the boundary line of exterior walls and a
proportionate share of any interior Common Areas, as well as any mezzanine or
second floor space.
1.11. GROSS RENTABLE AREA OF THE BUILDING
"Gross Rentable Area of the Building" means the sum of the aggregate Gross
Rentable Area of all premises in the Building which are leased or designated for
lease.
1.12. "INCLUDING" AND "INCLUDES"
"Including" and "includes" means, where the context permits, "including, without
limitation" and "includes, without limitation", respectively.
1.13. INDEMNIFIER
"Indemnifier" means the Person, if any, who has executed or agreed to execute
an Indemnity Agreement.
1.14. LANDS
"Lands" means the lands situated in Markham, in the Province of Ontario, on
which the Building is located, as more particularly described in Schedule "A",
as such lands may be expanded or reduced from time to time.
1.15. LEASEHOLD IMPROVEMENTS
"Leasehold Improvements" means leasehold improvements in the Premises determined
according to common law.
1.16. MORTGAGE
"Mortgage" means an encumbrance given by the Landlord against the Landlord's
interest in the Lands or Property.
1.17. MORTGAGEE
"Mortgagee" means the holder of, or secured party under, any Mortgage.
1.18. NET RENT
"Net Rent" means the annual rent payable by the Tenant under Section 3.2.
1.19. OFFER TO LEASE
"Offer to Lease" means the agreement between the Landlord and Tenant with
respect to the Premises, dated the 13th day of May, 1997, as amended by
agreements dated May 30, 1997, June 9, 1997 and June 12, 1997.
1.20. OPERATING COSTS
"Operating Costs" means the total of all costs paid or payable by the Landlord
or by others in maintaining, operating and managing the Property, calculated as
if the Building were 100% occupied by tenants during the Term including, without
limitation and without duplication, the aggregate of:
(a) the total annual costs of insurance carried in respect of the Property;
(b) cleaning, snow removal from the Common Areas, garbage and waste
collection and disposal, landscaping and parking areas and janitorial
service, if required;
(c) lighting, electricity and public utilities servicing the Common Areas
and all utilities not separately metered to tenants;
(d) policing, security and supervision, accounting, auditing and related
expenses;
(e) amounts paid to third parties and salaries of personnel employed to
maintain the Lands and operate and maintain the Building, including
contributions and premiums for fringe benefits, unemployment insurance,
and workers' compensation insurance, pension plan contributions and
uniforms;
(f) the cost of equipment and signs, including Building directory board and
identification and the repair and maintenance thereof,
(g) the cost of building supplies and materials used by the Landlord in the
maintenance and repair of the Common Areas;
(h) all repairs and replacements to and maintenance and operation of the
Building and Common Areas, including the Heating, Ventilating and
Air-Conditioning System ("HVAC"), where applicable, preventative
maintenance and inspection, engineering, service contracts, legal and
consulting services and all repairs and/or replacements relating to the
elevators, if any, located in the Building;
(i) depreciation or amortization of the costs, including repair and
replacement of the maintenance, cleaning and operating equipment and
facilities, roof, HVAC, master utility meters and all other fixtures,
equipment and facilities that are part of Common Areas unless they are
charged fully in the Rental Year in which they are incurred, all in
accordance with generally accepted accounting principles;
(j) interest calculated at 2% above the prime rate, announced by the
Landlord's bank, upon the undepreciated or unamortized part of the
costs referred to in (i) above;
(k) Capital Tax;
(l) all costs incurred in contesting or appealing Taxes or related
assessments, including legal, appraisal and other professional fees,
administration and overhead costs; and
(m) a management fee equal to 4% of the net rent and additional rent to the
Landlord, or at the Landlord's option 15% of additional Rent (Realty
Taxes plus Operating Costs)
To the extent that any Operating Costs should be allocated, in the reasonable
opinion of the Landlord, to a particular tenant or group of tenants, the
Landlord may so allocate and the Tenant will pay those costs, as so allocated.
Operating Costs shall not include:
(a) All amounts which otherwise would be included in Operating Costs which
are recovered by the Landlord from tenants as a result of any act,
omission, default or negligence of such tenants;
(b) Such of the Operating Costs as are recovered from insurance proceeds;
(c) Interest on debt and capital retirement of debt;
(d) Tenant inducement payments, leasehold improvement allowances and
rent-free periods, if any, granted to the tenants of the Building; and
(e) Brokerage fees and commissions and other similar costs incurred by the
Landlord in leasing premises in the Building.
The Landlord warrants and represents that Additional Rent for the calendar year
1997 is estimated to be $2.30 per square foot of the Gross Rentable Area of the
Premises.
1.21. PERSON
"Person" means any person, firm, partnership or corporation, or any group or
combination of persons, firms, partnerships or corporations.
1.22. PREMISES
"Premises" means the premises leased to the Tenant under Section 2. 1.
1.23. PROPERTY
"Property" means the Lands and Building.
1.24. PROPORTIONATE SHARE
"Proportionate Share" means a fraction which has as its numerator the Gross
Rentable Area of the Premises and as its denominator the Gross Rentable Area of
the Building.
1.25. RENT
"Rent" means the aggregate of Net Rent and Additional Rent.
1.26. RENTAL YEAR
"Rental Year" means a period of 12 consecutive full calendar months, the first
Rental Year beginning on the Commencement Date if such date is the first day of
a calendar month; if not, then the first Rental Year shall commence upon the
first day of the calendar month next following the month in which the
Commencement Date occurs. Each succeeding Rental Year shall commence upon the
anniversary date of the first Rental Year.
1.27. RULES AND REGULATIONS
"Rules and Regulations" means the rules and regulations under Section 11.2.
1.28. SALES TAX
"Sales Tax" means any sales tax, goods and services tax, value added tax, or any
other tax imposed on the Landlord with respect to Rent, or in respect of the
rental of the Premises, whether characterized as a sales tax, goods and services
tax, value added tax, business transfer tax or otherwise.
1.29. STRUCTURAL REPAIRS
"Structural Repairs" means repairs to the foundation, wall and roof support
columns, roof joists and the roof deck of the Building.
1.30. TAXES
"Taxes" means all taxes, levies, charges, school and local improvement rates and
assessments whatsoever (including municipal and other property taxes) assessed
or charged against the Property or any part of it (including Common Areas) or
against the Landlord on account of its ownership of the Property by any lawful
taxing authority and including any amounts assessed or charged in substitution
for or in lieu of any such taxes, but excluding only such taxes as capital gains
taxes, corporate, income, profit or excess profit taxes to the extent such taxes
are not levied in lieu of any of the foregoing against the Property or the
Landlord in respect thereof. Taxes shall in every instance be calculated on the
basis of the Building being assessed as fully leased and operational.
1.31. TENANT
"Tenant" includes every Person mentioned as Tenant in this lease.
1.32. TERM
"Term" means the term of this lease under Section 2.2 and all renewals and
extensions.
1.33. TRANSFER
"Transfer" means an assignment of this lease or a sublease of any part of the
Premises; any transaction whereby the rights of the Tenant are transferred or by
which any right of use of any part of the Premises is conferred upon anyone; any
encumbrance of this lease or other arrangement under which either this lease or
the Premises become security; and includes any transaction whatsoever (including
expropriation, receivership proceedings, seizure by legal process and transfer
by operation of law), which has changed the identity of the Person having lawful
use of any part of the Premises.
1.34. TRANSFEREE
"Transferee" means the Person to whom a Transfer is or is to be made.
ARTICLE 2
2. TERM AND USE
2.1. GRANT AND PREMISES
The Landlord leases the Premises to the Tenant for the Term. The Premises
are shown outlined on the site plan attached as Schedule "A" and are presently
known as 000 XXXXXXXX XXXXX Xxxx Xx. 0 of the Building. The Gross Rentable
Area of the Premises is approximately 14,400 square feet.
2.2. TERM
The Term of this lease is 8 years commencing on July 1, 1997 and expiring on
June 30, 2005.
2.3. CONSTRUCTION OF PREMISES
The provisions of the Offer to Lease relating to construction of the Premises,
specifically, paragraphs 6, 7, 9 and 15 of the Offer to Lease shall remain in
effect and shall not merge upon execution of this lease.
2.4. USE
The Tenant shall use and occupy the Premises only for general offices and as a
data centre and for no other purpose. The Tenant, shall comply with all laws,
rules and regulations of authorities and with any certificate of occupancy. The
Tenant shall not use or permit to be used any part of the Premises for any
dangerous, noxious, or offensive business and will not cause or maintain any
nuisance in the Premises and no machinery shall be used on the Premises which
shall cause any undue vibration in the Premises, and if the Landlord shall
complain that any machinery or operation thereof in the Premises is a nuisance,
the Tenant will immediately cease such nuisance. The Tenant has satisfied itself
that the contemplated use of the Premises complies with all relevant
governmental authorities.
2.5. TENANT'S COVENANTS AS TO USE AND OCCUPANCY
The Tenant shall, at its cost, comply with all provisions of law including,
without limiting the generality of the foregoing, the requirements of all
governmental laws, by-laws or regulations now or hereafter in force (whether or
not same shall require alterations). The Tenant will further comply with all
police, fire, health and sanitary regulations imposed by any governmental
authorities or made by any insurers.
2.6. ENVIRONMENTAL
(a) The Tenant will not bring upon, permit or use any substance, defined or
designated as a hazardous or toxic waste, hazardous or toxic material, a
hazardous, toxic or radioactive substance or other similar term, by any
applicable governmental law, regulation, by-law or ordinance now or hereafter in
effect, or any substance or material, the use or disposition of which is
regulated by any such law, regulation, by-law or ordinance (hereinafter called
"Toxic Materials") in, on or under the Premises or the Lands and the Tenant will
promptly comply with all laws, by-laws and ordinances, and with all orders,
decrees or judgements of governmental authorities or courts having jurisdiction,
relating to the use, collection, storage, treatment, control, removal or clean
up of Toxic Materials in, on, under the Premises or the Lands if the Premises or
the Lands become contaminated with Toxic Materials as a result of operations or
activities on the Premises or the Lands or incorporated in any Leasehold
Improvements. The Landlord may, enter upon the Premises and take such actions
and incur such costs to effect such compliance as it deems advisable and the
Tenant shall reimburse the Landlord on demand for the full amount of all costs
incurred in connection with such compliance.
(b) Indemnity: The Tenant shall indemnify and save harmless the Landlord, its
directors, employees, officers, shareholders and any other Person for whom it is
or they are in law responsible, from and against all losses, costs, damages,
liabilities, expenses, fees, fines, penalties and charges whatsoever incurred
with respect to or as a result of any breach by the Tenant of its covenant
aforesaid or otherwise arising out of the use made of the Premises by the Tenant
or any other occupant thereof. The liability of the Tenant shall not be affected
by or limited to contaminants within the knowledge or control of the Tenant and
the Tenant's liability shall extend to all contaminants on or in the Premises,
Building or Lands created during the Term, no matter how caused, except those
created or caused by the Landlord or those for whom it is in law responsible.
The foregoing obligations of indemnification and all of the other obligations of
the Tenant under this Section 2.6 shall survive the expiration or early
termination of this lease and shall remain in full force and effect until
complied with. Failure by the Tenant to comply with its obligations under this
Section 2.6 shall constitute a default under this lease. If the Tenant fails to
comply with any of its obligations under this Section 2.6, the Landlord may (but
shall not be obliged to) comply with same at the Tenant's sole cost and the
Tenant shall pay such cost, together with an additional sum of 15% of such cost
for the Landlord's overhead, to the Landlord forthwith on demand.
ARTICLE 3
3. RENT
3.1. COVENANT TO PAY
(a) The Tenant shall pay Rent from the Commencement Date without prior demand
and without any deduction, abatement, set-off or compensation. If the first or
last Rental Year of the Term comprises less than 12 calendar months, then Net
Rent and Additional Rent for such Rental Years shall be prorated on a per diem
basis, based upon a period of 365 days. The Tenant shall deliver post-dated
cheques to the Landlord prior to each Rental Year for Net Rent and estimated
Additional Rent as required by the Landlord.
(b) Notwithstanding anything contained in the foregoing to the contrary, the
Tenant shall not be required to submit post-dated cheques to the Landlord unless
it shall be late with the payment of Rent on two occasions during the Term. Upon
the second late payment of Rent the Tenant shall forthwith deliver to the
Landlord post-dated cheques for the remaining months of that year and,
thereafter, the Tenant shall deliver post-dated cheques to the Landlord in
accordance with Section 3. 1 (a).
3.2. NET RENT
The Tenant shall pay Net Rent for each year of the Term as set out below, which
shall be payable in each year of the Term in equal monthly instalments in
advance on the first day of each calendar month of each year of the Term:
RENTAL PERIOD ANNUAL RENTAL MONTHLY RENTAL RATE PER SQ.FT.
July 1, 1997 to $68,400.00 $5,700.00 $4.75
November 30, 2000
December 1, 2000 to $97,200.00 $8,100.00 $6.75
June 30, 2002
July 1, 2002 to $104,400.00 $8,700.00 $7.25
June 30, 2005
3.3. ADDITIONAL RENT
Except as otherwise provided in this lease, all Additional Rent shall be payable
by the Tenant to the Landlord within 5 business days after receipt of demand by
the Tenant.
3.4. RENTAL DEPOSIT
The Landlord acknowledges receipt of a cheque in the amount of $9,052.20 from
the Tenant, to be applied as a deposit against Rent accruing due in the first
month of the Term.
3.5. SECURITY DEPOSIT
The Tenant shall deposit with the Landlord on the execution of this lease a
security deposit (the "Security") in the amount of $10,670.04, to be held by the
Landlord, without interest. as security for the performance by the Tenant of the
terms of this lease. In the event of default by the Tenant under this lease, the
Landlord may at its option, without prejudice to any of its other rights, apply
all or part of the Security to compensate it for any loss as a result of such
default. If all or any part of the Security is so applied, the Tenant shall, on
demand, restore the Security to its original amount. On termination of this
lease, if the Tenant is not then in default, the Security will be returned to
the Tenant. If the Landlord sells its interest in the Premises, it may deliver
the Security to the purchaser, and the Landlord will be released from any
further liability with respect to the Security or its return to the Tenant.
3.6. PAYMENT OF TAXES AND OPERATING COSTS
(a) The Tenant shall pay to the Landlord the Tenant's Proportionate Share
of Operating Costs.
(b) The Tenant shall pay to the Landlord, when due, all Taxes in respect of the
Premises, including any Taxes charged in respect of any Common Areas. In
addition, the Tenant shall pay its Proportionate Share of Taxes, if any,
separately charged against Common Areas. The Tenant's obligation to pay Taxes in
respect of the Premises shall be determined on the basis of a separate xxxx, if
available. If the relevant taxing authority does not issue a separate xxxx for
Taxes in connection with the Premises, then the Tenant's obligation in respect
of Taxes shall be computed by applying the relevant tax rate to a separate
assessment of the Premises, if any. If there is neither a separate xxxx for
Taxes for the Premises nor a separate assessment of the Premises, then Taxes
charged in respect of the Premises shall be determined by the Landlord, acting
reasonably, on the basis of then current established principles of assessment
used by the relevant assessing authorities.
(c) Notwithstanding any other provision of this lease, if Taxes in respect of
the Building, Lands or Premises shall be increased by reason of any
installations made in or alterations made to the Premises, the Tenant shall pay
the entire amount of such increase. If the Tenant designates that Taxes shall go
to support separate schools, the Tenant shall pay to the Landlord the difference
between the rate for separate and public schools as Additional Rent, forthwith
upon presentation of an invoice therefor, in addition to the amounts otherwise
payable by the Tenant hereunder.
(d) The Tenant shall pay when due all Business Tax and Sales Tax. Sales Tax
shall be deemed to be a tax and not Additional Rent, but the Landlord shall have
the same remedies as it has in respect of a default in the payment of Additional
Rent,
(e) The Landlord may, on prior notice to the Tenant and at the Tenant's cost,
contest any Taxes and appeal any Tax assessments; withdraw any such contest or
appeal; and agree with the taxing authorities on any settlement or compromise
with respect to Taxes. The Tenant will co-operate with the Landlord in respect
of any such contest or appeal and will provide the Landlord with all relevant
information, documents and consents required. The Tenant will not contest any
Taxes.
(f) The Tenant shall have the right and privilege of appealing assessments or
applying for a reduction of any Taxes, provided that it shall first either pay
the Taxes under protest, or, if such payment is not required by law or can be
withheld without subjecting the Premises to sale or forfeiture proceedings or
without resulting in a default under or breach of any Mortgage, either (i)
furnish to the Landlord satisfactory security for the payment of the Taxes by
bond, irrevocable bank letter of credit or otherwise in case of failure of such
appeal or application, or (ii) provide the Landlord with evidence reasonably
satisfactory to the Landlord of the Tenant's ability to pay the amount of the
Taxes under protest, together with any interest, penalties or other changes
payable in connection therewith. The Tenant may take such action in its own
name, or, if required and upon giving the Landlord satisfactory indemnity in
respect of such action and all costs relating thereto, in the name of the
Landlord, and the Landlord agrees to join in such proceedings, sign such
documents and otherwise co-operate in such proceedings as reasonably requested
by the Tenant, all at the cost and expense of the Tenant. The Tenant shall
diligently prosecute any such appeal, application or proceedings and shall
immediately after the final determination of such appeal, application or
proceedings, pay the amount of the Taxes which were the subject of such
proceedings as so determined, as and when they become due and payable, together
with any interest, penalties or other charges which are payable in connection
with the Taxes.
(g) The amount of Taxes and Operating Costs payable to the Landlord may be
estimated by the Landlord for such period (not to exceed 12 months) as the
Landlord determines from time to time, and the Tenant agrees to pay to the
Landlord the amounts so estimated in equal instalments in advance on the first
day of each month during such period. Notwithstanding the foregoing, the
Landlord may charge the Tenant for Taxes over 9 months and when bills for all or
any portion of such amounts are received, the Landlord may xxxx the Tenant for
the Tenant's Proportionate Share thereof and the Tenant shall pay the Landlord
such amounts so billed after crediting against such amount any monthly payments
of estimated Taxes and Operating Costs previously made by the Tenant.
(h) Within a reasonable period of time after the end of the period for which
estimated payments have been made, the Landlord shall submit to the Tenant a
statement setting forth the actual amounts payable by the Tenant on account of
Taxes and Operating Costs, with adjustments (if any) to be made forthwith.
3.7. RENT & ADDITIONAL RENT PAST DUE
If the Tenant fails to pay, when the same is due and payable, any Rent, such
unpaid amount shall bear interest from the due date thereof to the date of
payment at 18% per annum.
3.8. NET LEASE
This lease is a completely carefree net lease to the Landlord, except as
expressly set out in this lease, The Landlord is not responsible for any
expenses of any nature arising from or relating to the Premises or their use or
occupancy, or their contents or the business carried on therein. The Tenant
shall pay all charges of every nature and kind relating to the Premises except
as expressly set out in this lease.
3.9. UTILITIES
The Tenant shall pay to the Landlord, or as it directs, all gas, electricity,
water, steam and other utility charges applicable to the Premises as separately
metered (which meters the Tenant shall pay for) or on the basis of the Tenant's
Proportionate Share. The Landlord shall be entitled to allocate to the Premises
an additional charge, as determined by the Landlord's engineer, for any excess
supply of utilities to the Premises. Charges for utilities shall be payable in
equal instalments in advance on the first day of each month.
3.10. HEATING, VENTILATING AND (IF APPLICABLE) AIR-CONDITIONING UNITS
The Landlord warrants that the heating and air-conditioning (if any) units
located in the Premises (the "Units") will be in good working order on the
Commencement Date. The Tenant shall 30 days prior to the expiration of the Term
provide the Landlord with a certificate from a recognized, reputable heating and
air-conditioning contractor approved by the Landlord, stating that the Units are
in good working order, reasonable wear and tear only excepted. If such
certificate is not provided, the Landlord may use the Security towards payment
for any repairs necessary to put the Units into good working order. The Tenant
shall, throughout the Term, at its cost, keep in force a maintenance contract
for the Units with a heating and air-conditioning contractor acceptable to the
Landlord and the Tenant shall produce a copy of such contract to the Landlord
within 30 days of the Commencement Date. Notwithstanding the foregoing the
Landlord may, at its option, take out any such preventative maintenance
contract, in which case the Tenant shall pay, as Additional Rent all costs
incurred by the Landlord.
ARTICLE 4
4. MAINTENANCE, REPAIRS AND COMMON AREAS
4.1. TENANT'S OBLIGATIONS
The Tenant covenants that at its cost:
(a) it shall repair, maintain and keep the Premises (including, without
limitation Leasehold Improvements, the Units and all plate glass) in good
condition and repair and in accordance with all laws, directions, rules and
regulations of all governmental agencies having jurisdiction and without
limitation, will make all repairs and replacements to all of the Premises,
including replacement to all equipment and base building facilities and all
Structural Repairs unless specifically excepted herein. For greater clarity, it
is understood and agreed by the parties that any Structural Repairs shall be
performed by the Landlord at the Tenant's sole cost and expense. The Tenant
covenants to heat the Premises to a temperature sufficient to prevent all pipes,
plumbing fixtures and equipment from bursting or suffering damage;
(b) it shall keep all entrance-ways and all steps and platforms leading thereto
and the Lands clear of all snow, ice and debris;
(c) it shall repair the Premises according to notice in writing from the
Landlord; and
(d) upon the expiration or earlier termination of the Term, the Tenant will
peaceably surrender and deliver up the Premises to the Landlord in a good state
of repair and maintenance, excepting only reasonable wear and tear not
inconsistent with the maintenance of the Building.
4.2. LANDLORD'S OBLIGATIONS
The Landlord covenants that it will at its cost make:
(a) structural repairs to the Premises, including roof, walls and floors caused
by or resulting from inherent structural defects or weaknesses; and
(b) repairs to be performed by the Landlord pursuant to Section 8.2 to the
extent of the insurance proceeds available.
The Landlord will perform any structural repairs required to be performed by it
under the terms of this lease upon written notice from the Tenant. Such repairs
shall be commenced promptly by the Landlord, acting as would a prudent landlord,
and the Landlord shall act diligently to minimize disruption to the Tenant's
operation of the Premises.
4.3. APPROVAL OF TENANT'S ALTERATIONS
(a) No Alterations shall be made to the Premises without the Landlord's prior
written approval, such approval not to be unreasonably withheld or delayed. All
Alterations shall be performed:
(i) by contractors and workmen approved by the Landlord;
(ii) in a good and workmanlike manner;
(iii)in accordance with drawings and specifications approved by
the Landlord;
(iv) in accordance with all applicable laws and regulations; and
(v) subject to such indemnification against liens as the Landlord
reasonably requires.
The Landlord's reasonable cost of supervising all such work and to have
such plans and specifications reviewed by the Architect shall be paid
by the Tenant.
(b) If any Alterations affect the structure of the Building or any of the base
building systems, such work shall at the option of the Landlord be performed by
the Landlord at the Tenant's cost as per (a) above, together with a sum equal to
15% of said cost representing the Landlord's overhead.
(c) The Tenant shall not place anything on or make any openings in the roof
without the prior written consent of the Landlord, which consent may be withheld
or given on such terms as the Landlord may determine. On termination of this
lease, the Tenant shall repair any damage caused to the Building as a result of
having placed anything on or having made openings in or having attached anything
to the roof and shall restore the roof to its former condition, all to the
satisfaction of the Landlord.
4.4. REPAIR WHERE TENANT AT FAULT
Notwithstanding any other provisions of this lease, if the Building or any part
thereof is damaged as a result of the act or omission of the Tenant or those for
whom it is in law responsible, the cost of the resulting repairs, plus a sum
equal to 15% of such cost representing the Landlord's overhead if such resulting
repairs are performed by or on behalf of the Landlord, shall be paid by the
Tenant to the Landlord.
4.5. REMOVAL OF IMPROVEMENTS AND FIXTURES
All Leasehold Improvements shall immediately upon their placement become the
Landlord's property without compensation to the Tenant. Except as otherwise
agreed by the Landlord in writing, no Leasehold Improvements or trade fixtures
of the Tenant shall be removed from the Premises either during or at the
expiration or sooner termination of the Term except that:
(a) the Tenant may, during the Term, in the usual course of its business, remove
its trade fixtures in order to replace or upgrade them, provided that the Tenant
is not in default under this lease, and
(b) the Tenant shall, at the expiration or earlier termination of the Term, at
its cost, remove all of its trade fixtures and such of the Leasehold
Improvements as the Landlord shall require to be removed, and to restore the
Premises to the condition in which they existed as at the Commencement Date, to
the extent required by the Landlord. The Tenant shall at its cost repair any
damage caused to the Building by such removal. If the Tenant does not remove its
trade fixtures as aforesaid, they shall, at the option of the Landlord, become
its property and may be removed and disposed of by the Landlord in such manner
as it deems advisable.
4.6. LIENS
The Tenant shall promptly pay for all materials supplied and work done in
respect of the Premises so as to ensure that no lien is registered against the
Lands. The Tenant shall discharge any lien within 5 business days from the
Landlord's notice, failing which the Landlord may at its option discharge the
same, with all costs, including solicitor's fees (on a solicitor/client basis)
incurred by the Landlord to be paid by the Tenant to the Landlord within 5
business days after demand.
4.7. NOTICE BY TENANT
The Tenant shall notify the Landlord of any damage in any part of the Premises
or the Property, which comes to the attention of the Tenant.
4.8. NO LANDLORD'S LIABILITY
The Landlord is not liable for any damage caused to the Tenant by reason of
failure of any equipment or facilities serving the Building or the Property,
interruption or discontinuance of any utility services or delays in the
performance of any work for which the Landlord is responsible. Upon reasonable
prior notice to the Tenant except in the case of an emergency when no notice
shall be required, the Landlord may stop, interrupt or reduce any services,
systems or utilities provided to, or serving, the Building or the Premises, for
the purpose of performing repairs, alterations or maintenance or to comply with
laws or regulations or binding requirements of its insurers or for causes beyond
the Landlord's reasonable control or as a result of the Landlord exercising any
rights reserved to it pursuant to this lease. The Landlord shall not be in
breach of its covenant for quiet enjoyment or liable for any loss, costs or
damages, whether direct or indirect, incurred by the Tenant due to any of the
foregoing, but the Landlord shall use reasonable efforts to restore the
services, utilities or systems so stopped, interrupted or reduced as soon as is
reasonably possible.
ARTICLE 5
5. CONTROL OF PROPERTY BY LANDLORD
5.1 ALTERATIONS BY LANDLORD
The Landlord may:
(a) alter, add to, subtract from, construct improvements to,
re-arrange, build additional storeys on and construct additional
facilities in, adjoining or proximate to the Property;
(b) relocate the facilities and improvements in or comprising the
Property or erected on the Lands;
(c) do such things on or in the Property as required to comply with
any laws, by-laws, regulations,orders or directives affecting the Lands
or any part of the Property; and
(d) do such other things on or in the Property as the Landlord, in
the use of good business judgment determines to be advisable,
provided that notwithstanding anything contained in this Section 5.1 access to
the Premises shall be available at all times. The Landlord shall not be in
breach of its covenant for quiet enjoyment or liable for any loss, costs or
damages, whether direct or indirect, incurred by the Tenant due to any of the
foregoing. The Landlord shall exercise its rights under this Section 5.1, to the
extent possible in the circumstances, in such manner so as to minimize
interference with the Tenant's use and enjoyment of the Premises.
5.2. RIGHT OF EXAMINATION
The Landlord may at all reasonable times enter the Premises to examine them and
to make such repairs, alterations or improvements thereto as the Landlord
considers necessary. The Landlord reserves to itself the right to use the
exterior walls, the roof, and the right to install, maintain, use and repair
pipes, ducts, conduits, vents, wires and other installations leading in,
through, over, or under the Premises and for this purpose, the Landlord may take
all material into and upon the Premises which is required therefor. The Tenant
shall not unduly obstruct any pipes, conduits or mechanical or other electrical
equipment so as to prevent reasonable access thereto. The Landlord shall
exercise its rights under this Section 5.2, to the extent possible in the
circumstances, in such manner so as to minimize interference with the Tenant's
use and enjoyment of the Premises.
5.3. RIGHT TO SHOW PREMISES
The Landlord and its agents have the right to enter the Premises at all
reasonable times on reasonable prior notice to show the Premises to prospective
purchasers or Mortgagees and, during the last six months of the Term (or the
last six months of any renewal term if this lease is renewed), to show them to
prospective tenants. The Tenant may provide a representative to accompany the
Landlord when showing the Premises as aforesaid.
5.4. ENTRY NOT FORFEITURE
No entry into the Premises by the Landlord pursuant to a right granted by this
lease shall constitute a breach of any covenant for quiet enjoyment, or (except
where expressed by the Landlord in writing or otherwise intended) shall
constitute a re-entry or forfeiture.
5.5. MAINTENANCE SCHEDULE
As soon as reasonably possible after execution of this lease, the Tenant shall
provide the Landlord with a schedule ("Schedule") indicating times during which
the Landlord would be able to conduct maintenance and/or stop services with a
minimum of disturbance to the Tenant's operations in the Premises. Except in the
case of an emergency, in exercising its rights under Sections 4.8, 5.1 and 5.2
the Landlord shall, to the extent reasonably possible under the circumstances,
adhere to the Schedule. If, as a result of adhering to the Schedule, the
Landlord incurs an additional cost for the performance of any service and/or
maintenance outside of normal business hours, the Tenant shall reimburse the
Landlord for such additional cost, forthwith upon demand.
ARTICLE 6
6. INSURANCE AND INDEMNITY
6.1. TENANT'S INSURANCE
(a) The Tenant will, throughout the Term, at its cost take out and maintain, in
the name of the Tenant and the Landlord and the Mortgagee as loss payee, when
applicable, as their respective interests may appear, the following insurance,
which will contain the Mortgagee's standard mortgage clause and will contain a
waiver of any subrogation rights which the Tenant's insurers may have against
the Landlord and against those for whom it is in law responsible:
(i) insurance upon all property owned by the Tenant or for which the Tenant
is legally liable, and which is located in the Premises including, without
limitation, alterations, trade fixtures, and Leasehold Improvements, as well as
inventory in an amount of at least 90% of the full replacement cost, with
coverage against at least the perils of fire and standard extended coverage,
including sprinkler leakages (where applicable), flood and collapse;
(ii) if applicable, broad form boiler and machinery insurance on a blanket
repair and replacement basis with limits for each accident in an amount of at
least 90% of the full replacement cost of all boilers, pressure vessels, heating
and air-conditioning equipment and miscellaneous electrical apparatus owned or
operated by the Tenant or by others (other than the Landlord) on behalf of the
Tenant;
(iii)standard extra expense insurance;
(iv) comprehensive general liability insurance, including personal injury
liability, contractual liability, non-owned automobile liability, employers'
liability and owners' and contractors' protective insurance coverage with
respect to the Premises and the Tenant's use of the Common Areas. Such policies
shall (1) be written on a comprehensive basis with inclusive limits of not less
than $2,000,000.00 for bodily injury to any one or more Persons, or property
damage, and such higher limits as the Landlord, acting reasonably, requires from
time to time; and (2) contain a severability of interests clause and a cross
liability clause;
(v) Tenant's legal liability insurance for the actual cash value of the
Premises, including loss of use thereof,
(vi) if applicable, standard owner's form automobile policy providing third
party liability insurance with $2,000,000.00 inclusive limits, and accident
benefits insurance, covering all licensed vehicles owned or operated by or on
behalf of the Tenant; and
(vii) any other of insurance as the Tenant or the Landlord, acting
reasonably, requires from time to time in form, in amounts and for insurance
risks against which a prudent tenant would insure.
(b) All policies:
(i) will be taken out with insurers acceptable to the Landlord, acting
reasonably;
(ii) will be in a form satisfactory from time to time to the Landlord,
acting reasonably;
(iii) will be non-contributing with, and will apply only as primary and not
as excess to any other insurance available to the Landlord or the Mortgagee; and
(iv) will not be invalidated as respects the interests of the Landlord and
of the Mortgagee by reason of any breach or violation of any warranties,
representations, declarations or conditions contained in the policies. All
policies will contain an undertaking by the insurers to notify the Landlord and
the Mortgagee in writing by registered mail at least thirty (30) days before any
material change, cancellation or termination of them.
(c) Certificates of insurance will be delivered to the Landlord before the
Tenant obtains possession of the Premises for any purpose. No review or approval
of any insurance certificate by the Landlord diminishes its rights or the
Tenant's obligations in this lease.
(d) If the Tenant fails to take out or keep in force any required insurance or
should any of that insurance not be approved by the Landlord, and should the
Tenant not commence to diligently rectify (and afterwards to proceed diligently
to rectify) the situation within 48 hours after notice by the Landlord, the
Landlord may, without obligation, effect such insurance at the Tenant's cost and
all costs of the Landlord will be immediately paid by the Tenant to the Landlord
as Additional Rent, together with a fee of 15% representing the Landlord's
overhead. This right is without prejudice to the other rights and remedies of
the Landlord under this lease.
6.2. LANDLORD'S INSURANCE
The Landlord will carry the following:
(a) insurance on the Building (excluding foundations and excavations) and the
machinery, boilers, and equipment contained in it and owned by the Landlord
(excluding any property with respect to which the Tenant or other occupants are
required to insure under Section 6.1 or similar Sections) against damage by fire
and extended perils coverage in those reasonable amounts and with those
reasonable reductions that would be carried by a prudent owner of a reasonably
similar project, having regard to size, age and location, but shall be insured
for the full replacement cost;
(b) comprehensive public liability and property damage insurance with respect to
the Landlord's operations in the Premises, in the Building and on the Lands, in
those reasonable amounts for personal and bodily injury or death and damage to
property of others; and
(c) those other forms of insurance which the Landlord considers advisable.
Despite this Section 6.2, and regardless of any contribution by the Tenant to
the costs of insurance premiums, (i) the Tenant is not relieved of any liability
arising from or contributed to by its negligence or its wilful acts or
omissions, and (ii) no insurable interest is conferred upon the Tenant under any
policies of insurance carried by the Landlord and the Tenant has no right to
receive any proceeds of any such insurance policies.
6.3. INDEMNIFICATION OF THE LANDLORD
Notwithstanding any other provision of this lease, the Tenant shall indemnify
the Landlord and save it harmless from and against any and all loss (including
loss of Rent), claims, actions, damages, liability and expense in connection
with loss of life, personal injury, damage to property or any other loss or
injury whatsoever arising from or out of this lease, or any occurrence in, upon
or at the Premises, or the occupancy or use by the Tenant of the Premises or any
part thereof, or occasioned wholly or in part by any act or omission of the
Tenant or by anyone permitted to be on the Premises by the Tenant. If the
Landlord shall, without fault on its part, be made a party to any litigation
commenced by or against the Tenant, then the Tenant shall protect, indemnify and
hold the Landlord harmless and shall pay all expenses and reasonable legal fees
incurred (on a solicitor/client) basis or paid by the Landlord in connection
with such litigation. The Tenant shall also pay all expenses and legal fees (on
a solicitor/client basis) that may be incurred or paid by the Landlord in
enforcing the terms of this lease, unless a court shall decide otherwise.
6.4. LOSS OR DAMAGE
The Landlord shall not be liable for any death or injury arising from or out of
any occurrence in, upon, at or relating to the Property or damage to property of
the Tenant or of others located on the Premises or elsewhere in the Property,
nor shall it be responsible for any loss of or damage to any property of the
Tenant or others from any cause, whether or not any such death, injury, loss or
damage results from the negligence of the Landlord, its agents, employees,
contractors, or others for whom it may, in law, be responsible. Without
limitation, the Landlord shall not be liable for any injury or damage to Persons
or property resulting from any cause whatsoever. All property of the Tenant
shall be so kept at the risk of the Tenant only and the Tenant releases and
agrees to indemnify the Landlord and save it harmless from any claims arising
out of any damage to the same, including any subrogation claims by the Tenant's
insurers.
6.5. INCREASE IN INSURANCE PREMIUMS
No article shall be kept in the Premises which is prohibited by any insurance
policy against the Building. If anything is done in the Building which increased
the insurance with respect to the Building, the Tenant shall pay any such
increase in premium. In determining whether increased premiums result from the
use of the Premises, a schedule issued by the Landlord's insurer shall be final
and binding.
6.6. CANCELLATION OF INSURANCE
If any insurance policy upon the Building or any part thereof shall be cancelled
or threatened to be cancelled or the coverage thereunder reduced by reason of
the use of the Premises, and if the Tenant fails to remedy such condition within
48 hours after notice, the Landlord may, at its option, at the Tenant's cost,
either:
(a) re-enter the Premises forthwith; or
(b) enter upon the Premises and remedy the condition giving rise to such
cancellation, threatened cancellation or reduction.
The Landlord shall not be liable for any damage or injury caused to any property
located on the Premises as a result of any such entry,
ARTICLE 7
7. ASSIGNMENT AND SUBLETTING
7.1. TRANSFERS
The Tenant shall not permit any Transfer without the prior written consent of
the Landlord, which consent shall not be unreasonably withheld, but shall be
subject to the Landlord's rights under Section 7.2. Notwithstanding any
statutory provision to the contrary, the Landlord may take into account the
following factors in deciding whether to grant or withhold its consent:
(a) whether such Transfer is breach of any covenants or restrictions made or
granted by the Landlord;
(b) whether in the Landlord's opinion, the financial background, business
history and capability of the proposed Transferee is satisfactory; and
(c) if the Transfer is to an existing tenant of the Landlord.
Consent by the Landlord to any Transfer if granted shall not constitute a waiver
of the necessity for such consent to any subsequent Transfer. This prohibition
against Transfer shall include a prohibition against any Transfer by operation
of law and no Transfer shall take place by reason of the failure of the Landlord
to give notice as required by Section 7.2.
7.2. LANDLORD'S RIGHT TO TERMINATE
If the Tenant intends to effect a Transfer, the Tenant shall give written notice
to the Landlord specifying the identity of the proposed Transferee and provide
such financial, business or other information relating to the Transferee and its
principals as the Landlord requires, together with copies of any Transfer
documents. The Landlord shall, within 30 days after having received such notice
and all requested information, notify the Tenant either that:
(a) it consents or does not consent to the Transfer; or
(b) it elects to cancel this lease as to the whole or part, as the case may be,
of the Premises affected by the proposed Transfer, in preference to giving such
consent.
If the Landlord elects to terminate this lease, it shall stipulate in its notice
the termination date, which date shall be no less than 30 days nor more than 90
days following the giving of such notice of termination. If the Landlord elects
to cancel this lease, the Tenant may notify the Landlord within 10 days
thereafter of the Tenant's intention either to refrain from such Transfer or to
accept the cancellation. If the Tenant fails to deliver such notice within such
period of 10 days or notifies the Landlord that it accepts the Landlord's
termination, this lease will as to the whole or affected part of the Premises,
as the case may be, be terminated on the date of termination stipulated by the
Landlord in its notice. If the Tenant advises the Landlord it intends to refrain
from such Transfer, then the Landlord's election to terminate this lease shall
become void in such instance.
7.3. CONDITIONS OF TRANSFER
(a) Any consent by the Landlord shall be subject to the Tenant and Transferee
executing an agreement with the Landlord agreeing that the Transferee will be
bound by all of the terms of this lease as if such Transferee had originally
executed this lease as tenant.
(b) Notwithstanding any Transfer, the Tenant shall be jointly and severally
liable with the Transferee under this lease and shall not be released from
performing any of the terms of this lease.
(c) If the net rent and additional rent to be paid by the Transferee exceeds the
Net Rent and Additional Rent, such excess shall be paid to the Landlord. If the
Tenant receives from any Transferee, either directly or indirectly, any
consideration other than rent or additional rent for such Transfer, the Tenant
shall forthwith pay to the Landlord such consideration.
(d) The Tenant will pay all legal costs and the Landlord's administration fee to
review or prepare any Transfer documents.
(e) The Landlord's consent to any Transfer shall be subject to the condition
that if the net rent and additional rent payable by the Transferee shall not be
less than the Net Rent and Additional Rent payable by the Tenant under this
lease as at the effective date of the Transfer.
7.4. CHANGE OF CONTROL
If the Tenant is at any time a corporation or partnership, any actual or
proposed Change of Control in such corporation or partnership shall be deemed to
be a Transfer and subject to all of the provisions of this Article 7. The Tenant
shall make available to the Landlord or its representatives all of its corporate
or partnership records, as the case may be, for inspection at all reasonable
times, in order to ascertain whether there has been any Change of Control.
7.5. NO ADVERTISING
The Tenant shall not advertise or permit to be advertised that the Premises are
available for Transfer unless the complete text of any such advertisement is
first approved in writing by the Landlord. No such advertisement shall contain
any reference to the rental rate of the Premises.
7.6. ASSIGNMENT BY THE LANDLORD
The Landlord shall have the unrestricted right to sell, lease, convey or
otherwise dispose of the Property or any part thereof and this lease, including
the right to mortgage this lease. To the extent that the purchaser or assignee
from the Landlord assumes the obligations of the Landlord under this lease, the
Landlord shall thereupon and without further agreement be released of all
liability under this lease.
7.7. PERMITTED TRANSFERS
Notwithstanding anything contained in Article 7 of this lease to the contrary,
the Tenant shall be entitled to Transfer this lease without the consent of the
Landlord to any affiliated body corporate of the Tenant (as that term is defined
by the Ontario Business Corporations Act, R.S.O. 1990, as amended or replaced),
the foregoing to be referred to as a "Permitted Transferee". The Tenant shall
provide prior written notice to the Landlord of its intent to effect such a
Transfer and shall provide the Landlord with the name(s) of the Permitted
Transferee as well as the proposed effective date of such Transfer and any such
Transfer shall otherwise be in accordance with Article 7. For greater certainty,
the parties acknowledge and agree that the Landlord shall have no right to
terminate the lease upon Transfer to a Permitted Transferee.
ARTICLE 8
8. DAMAGE, DESTRUCTION AND EXPROPRIATION
8. 1. LANDLORD'S OPTION
If the Premises are at any time damaged or destroyed as a result of fire or
other perils in respect of which the Landlord is required to insure against, and
if as a result of such occurrences:
(a) 50% or more of the Premises are rendered wholly unfit for occupancy;
(b) the cost of repairing or rebuilding the Premises exceeds 25% or more of
the replacement cost thereof; and
(c) in the opinion of the Architect the Premises cannot be repaired with
reasonable diligence within 180 days of the happening of such damage or
destruction.
Then, in each case, the Landlord may, at its option and upon notice to the
Tenant, terminate this lease. In such event, this lease shall terminate as of
the date of such damage or destruction and the Rent shall be apportioned and
paid in full to the date of termination. The Tenant will execute whatever
documents may be required by the Landlord in order that all proceeds of
insurance relating to the Leasehold Improvements shall be released to the
Landlord.
If in the opinion of the Architect, to be rendered within 30 days of the
happening of the damage or destruction, such damage or destruction to the
Premises cannot be repaired with reasonable diligence within 365 days of
occurrence, then either the Landlord or the Tenant may terminate this lease on
notice to the other. In such event, this lease shall terminate as of the date of
such damage or destruction and the Rent shall be apportioned and paid in full to
the date of termination. The Tenant will execute whatever documents may be
required by the Landlord in order that all proceeds of insurance relating to the
Leasehold Improvements shall be released to the Landlord.
8.2. DAMAGE TO PREMISES
If the Landlord does not elect to terminate this lease in accordance with
Section 8.1, then the Landlord shall commence with all reasonable diligence to
repair the Premises to the extent only of its obligations under this lease and
exclusive of any work performed in and to the Premises by or on behalf of the
Tenant (the "Landlord's Work of Reconstruction"). The Tenant will be entitled to
receive all proceeds of insurance which has been taken out by the Tenant
relating to the Leasehold Improvements provided the Tenant shall commence will
all reasonable diligence to repair and/or replace same and all such work shall
be conducted in accordance with Article 4 of this lease. In the event that the
cost of the repair and/or replacement of the Leasehold Improvements exceeds the
amount of insurance proceeds, the Tenant shall bear the cost of such excess. In
the event that the cost of repair and/or replacement is less than the amount of
insurance proceeds received by the Tenant, the amount of such excess shall
forthwith be paid to the Landlord.
From the date of the happening of such damage or destruction and until the
completion of the Landlord's Work of Reconstruction, the Net Rent shall xxxxx:
(a) in its entirety if, in the opinion of the Architect, the Premises are
rendered wholly untenantable; or
(b) proportionately (to the portion of the Premises rendered untenantable),
if in the opinion of the Architect, the Premises are rendered untenantable only
in part, subject, in either case, to the extent of the insurance proceeds
actually received by the Landlord.
8.3. LANDLORD'S PLANS
If the Landlord elects to repair the Premises, the Landlord shall be entitled to
use plans and specifications and working drawings in connection therewith other
than, but similar to those used in the original construction of the Premises.
8.4. ARCHITECT'S CERTIFICATE
The decision of the Architect as to:
(a) the time within which the Premises can or cannot be repaired;
(b) the extent of the damage or destruction to the Premises;
(c) the cost of repairing the Premises; and
(d) the date on which the Landlord's Work of Reconstruction is
completed, shall, in each case, be final and binding upon the parties
hereto.
ARTICLE 9
9. DEFAULT
DEFAULT AND REMEDIES
If and whenever:
(a) any Net Rent is in arrears whether or not any demand for payment has
been made by the Landlord;
(b) any Additional Rent is in arrears and is not paid within 5 days after
written demand by the Landlord;
(c) the Tenant has breached any of its obligations in this lease (other
than the payment of Rent) and the Tenant fails to remedy such breach within 15
days of written notice of such breach by the Landlord to the Tenant (or such
shorter period as may be provided in this lease) or if such breach cannot
reasonably be remedied within 15 days of notice as aforesaid or such shorter
period, the Tenant fails to commence to remedy and thereafter proceed diligently
to remedy such breach, in each case after notice in writing from the Landlord;
(d) the Tenant or any Indemnifier becomes bankrupt or insolvent or takes
the benefit of any statute for bankrupt or insolvent debtors or makes any
proposal, assignment or arrangement with its creditors, or any steps are taken
or proceedings commenced by any Person for the dissolution, winding-up or other
termination of the Tenant's existence or the liquidation of its assets;
(e) a trustee, receiver, receiver/manager or like Person is appointed with
respect to the business or assets of the Tenant or any Indemnifier;
(f) the Tenant makes a sale in bulk of all or a substantial portion of its
assets other than in conjunction with a Transfer approved by the Landlord;
(g) this lease or any of the Tenant's assets are taken under a writ of
execution;
(h) the Tenant purports to make a Transfer not in compliance with this
lease;
(i) the Tenant abandons or attempts to abandon the Premises or disposes of
its goods so that there would not after such disposal be sufficient goods of the
Tenant on the Premises subject to distress to satisfy Rent for at least 3
months, or the Premises become vacant and unoccupied for a period of 5
consecutive days or more without the consent of the Landlord; or
(j) any of the Landlord's policies of insurance with respect to the
Building or any part thereof are actually or threatened to be cancelled or
adversely changed as a result of any use or occupancy of the Premises;
then without prejudice to any other rights which it has pursuant to this lease
or at law, the Landlord shall have the following rights and remedies, which are
cumulative and not alternative:
(i) to terminate this lease;
(ii) to enter the Premises as agent of the Tenant and to relet the Premises
for whatever term, and on such terms as the Landlord in its discretion may
determine and to receive the Rent therefor and as agent of the Tenant to take
possession of any property of the Tenant on the Premises, to store such property
at the expense and risk of the Tenant or to sell or otherwise dispose of such
property in such manner as the Landlord may see fit without notice to the
Tenant;
(iii) to remedy or attempt to remedy any default of the Tenant under this
lease for the account of the Tenant and to enter upon the Premises for such
purposes;
(iv) to recover from the Tenant all damages and expenses incurred by the
Landlord as a result of any breach by the Tenant including, if the Landlord
terminates this lease, any deficiency between those amounts which would have
been payable by the Tenant for the portion of the Term following such
termination and the net amounts actually received by the Landlord during such
period of time with respect to the Premises; and
(v) to recover from the Tenant the full amount of the current month's Rent
together with the next 3 months' instalments of Rent; all of which shall accrue
on a day-to-day basis and shall immediately become due and payable as
accelerated Rent.
9.2. DISTRESS
Notwithstanding any provision of this lease or any provision of applicable
legislation, none of the goods of the Tenant on the Premises at any time during
the Term shall be exempt from levy by distress for Rent in arrears, and the
Tenant waives any such exemption. If the Landlord makes any claim against the
goods and chattels of the Tenant by way of distress, this provision may be
pleaded as an estoppel against the Tenant in any action brought to test the
right of the Landlord to levy such distress.
9.3. COSTS
The Tenant shall pay to the Landlord on demand all costs incurred by the
Landlord, including lawyers' fees, on a solicitor/client basis, incurred by the
Landlord in enforcing any of the obligations of the Tenant under this lease.
9.4. ALLOCATION OF PAYMENTS
The Landlord may at its option apply sums received from the Tenant against any
amounts due and payable by the Tenant under this lease in such manner as the
Landlord sees fit.
9.5. SURVIVAL OF OBLIGATIONS
All obligations of the Tenant under this lease which remain unfulfilled at the
determination of this lease and the Landlord's rights in respect of any failure
by the Tenant to perform any of its obligations under this lease shall survive
and remain in full force and effect notwithstanding the expiration or earlier
termination of the Term.
9.6. ADDITIONAL RENT DEEMED RENT
All Additional Rent shall be deemed to be rent and the Landlord shall have all
rights against the Tenant for default in the payment of Additional Rent as for
default in the payment of Net Rent, except as otherwise herein provided.
9.7. LANDLORD'S RIGHT TO PERFORM
In addition to all other remedies the Landlord may have by this lease, at law or
in equity, if the Tenant does not perform any of its obligations hereunder, the
Landlord may, at its option, but without any obligation, perform any of such
obligations of the Tenant, after 5 days' notice to the Tenant or in the event of
an emergency, without notice, and in such event, the cost of performing any of
such obligations, plus an administrative charge of 15% of such cost, shall be
payable by the Tenant to the Landlord forthwith on demand.
ARTICLE 10
10. STATUS STATEMENT; ATTORNMENT AND SUBORDINATION
10.1. STATUS STATEMENT
Within 10 days after written request by the Landlord, the Tenant shall deliver
to the Landlord, in a form supplied by the Landlord, a certificate as to the
status of this lease, the amount of Rent then being paid and the dates to which
it has been paid and any other matters pertaining to this lease as to which the
Landlord shall request such certificate.
10.2. SUBORDINATION
This lease and all rights of the Tenant shall be subject and subordinate to any
and all Mortgages from time to time in existence against the Property or any
part thereof. On request, the Tenant shall subordinate this lease and its rights
under the lease to any and all Mortgages and to all advances made under such
Mortgages. The form of such subordination shall be made as required by the
Landlord or any Mortgagee.
At the Tenant's request and sole cost and expense, the Landlord shall use
commercially reasonable efforts to obtain an agreement from any Mortgagee
agreeing to allow the Tenant to remain in quiet possession of the Premises so
long as the Tenant is not in default under the terms of this lease.
10.3. ATTORNMENT
The Tenant shall promptly on request attorn to any Mortgagee, or to the
registered owners of the Property, or the lessee under any lease of all or
substantially all of the Property made by the Landlord or otherwise affecting
the Property, or the purchaser on any foreclosure or sale under proceedings
taken under any Mortgage, and shall recognize such Mortgagee, owner, lessee or
purchaser as the Landlord under this lease.
10.4. EXECUTION OF DOCUMENTS
The Tenant irrevocably constitutes the Landlord the agent and attorney of the
Tenant for the purposes of executing any agreement, certificate, attornment or
subordination required by this lease and for registering postponements in favour
of any Mortgagee if the Tenant fails to execute such documents within 10 days
after request by the Landlord.
ARTICLE 11
11. GENERAL PROVISIONS
11.1. QUIET ENJOYMENT
If the Tenant pays Rent and fully observes and performs all of its obligations
under this lease, the Tenant shall, subject to the provisions of this lease, be
entitled to peaceful and quiet enjoyment of the Premises for the Term without
interruption or interference by the Landlord or any Person claiming through the
Landlord.
11.2. RULES AND REGULATIONS
The Tenant shall comply with all Rules and Regulations, and amendments to them,
adopted by the Landlord from time to time including those set out in Schedule
"B", so long as such Rules and Regulations arc not inconsistent with and do not
contradict this lease. The Rules and Regulations may differentiate between
different types of businesses in or other tenants or users of the Building and
the Landlord shall not be responsible to the Tenant for any non-observance of
such Rules or Regulations by any other tenant of the Building.
11.3. DELAY
Except as expressly provided in this lease, whenever the Landlord or Tenant is
delayed in the fulfilment of any obligation under this lease, other than the
payment of Rent, by an unavoidable occurrence which is not the fault of the
party delayed in performing such obligation, then the time for fulfilment of
such obligation shall be extended during the period in which such circumstances
operate to delay the fulfilment of such obligation.
11.4. OVERHOLDING
If the Tenant remains in possession of the Premises without the Landlord's
consent after the end of the Term, there shall be no tacit renewal of this lease
or the Term, and the Tenant shall be deemed to be occupying the Premises as a
Tenant from month to month at a monthly net rent equal to twice the monthly
amount of Net Rent payable during the last month of the Term, and otherwise upon
the same terms as set out in this lease, if applicable to a monthly tenancy. If
the Landlord and the Tenant execute an agreement whereby the Term of this lease
is extended ("Agreement"), the over holding rent paid by the Tenant according to
this Section 11.4 from the expiry date of this lease until the date the
Agreement is executed shall be credited toward the rent to be paid by the Tenant
pursuant to the Agreement.
11.5. WAIVER
If either the Landlord or Tenant excuses or condones any default by the other of
any obligation under this lease, this shall not be a waiver of such obligation
in respect of any continuing or subsequent default and no such waiver shall be
implied.
11.6. REGISTRATION
Neither the Tenant nor anyone claiming under the Tenant shall register this
lease or any Transfer without the prior written consent of the Landlord. If the
Tenant or any permitted Transferee wishes to register a document, then the
Landlord shall at the request and expense of the Tenant execute a notice lease
in such form as approved by the Landlord and without disclosure of any terms
which the Landlord does not desire to have disclosed. If the Lands comprise more
than one parcel of land, the Landlord may direct the Tenant or Transferee as to
the parcel or parcels against which registration may be effected.
11.7. NOTICES
Any notice, consent or other instrument which may be or is required to be given
under this lease shall be in writing and shall be delivered in person or sent by
registered mail postage prepaid addressed, if to the Landlord, at 00 Xxxxxxx
Xxxxx, Xxxxx 000, Xxxxxxxxx, Xxxxxxx, X0X 0X0; and if to the Tenant, at the
Premises. Any such notice or other instrument shall be deemed to have been given
and received on the day upon which personal delivery is made or, if mailed, 3
business days following the date of mailing. Either party may give notice to the
other of any change of address and, after the giving of such notice, the address
so specified shall be used for the giving of notices. If postal service is
interrupted or substantially delayed, all notices or other instruments shall be
delivered in person.
11.8. SUCCESSORS & ASSIGNS
The rights and liabilities created by this lease extend to and bind the
successors and assigns of the Landlord and the permitted successors and assigns
of the Tenant. No rights, however, shall enure to the benefit of any Transferee
unless the provisions of Article 7 are complied with.
11.9. JOINT AND SEVERAL LIABILITY
If there is at any time more than one Tenant of more than one Person
constituting the Tenant, their covenants shall be considered to be joint and
several and shall apply to each and every one of them. If the Tenant is or
becomes a partnership, each Person who is a member, or shall become a member, of
such partnership or its successors shall be and continue to be jointly and
severally liable for the performance of all covenants of the Tenant pursuant to
this lease, whether or not such Person ceases to be a member of such partnership
or its successor.
11.10. CONSENT
Whenever in this lease the consent or approval of the Landlord is required, such
consent or approval will not be unreasonably withheld or delayed unless
specifically stated to the contrary.
11.11. SIGNS
The Tenant will not paint, fix, display, or cause to be painted, fixed or
displayed, any sign, picture, advertisement notice, lettering or decoration on
any part of the exterior of the Premises, except with the written permission of
the Landlord, consistent with the Landlord's sign criteria. The Tenant shall
cause any signs erected on any part of the exterior or the interior of the
Premises to be installed: (i) in compliance with all requirements of all
governmental authorities having jurisdiction with respect thereto; (ii) at the
sole cost of the Tenant; (iii) in a good and workmanlike manner; and (iv) in
accordance with plans and specifications that comply with the Landlord's
reasonable regulations. The sign shall be maintained by the Tenant at its sole
cost and expense and the Tenant shall pay for any electricity consumed by such
sign.
At the expiration or earlier termination of the Term, the Tenant shall remove
any such signs or other advertising material, as aforesaid, from the Premises at
the Tenant's expense and shall promptly repair all damage caused by any such
installation or removal.
11.12. ACCORD AND SATISFACTION
No payment by the Tenant or receipt by the Landlord of a lesser amount than the
monthly Rent herein stipulated shall be deemed to be other than on account of
the earliest stipulated rent, nor shall any endorsement or statement on any
cheque or any letter accompanying any cheque or payment as rent be deemed an
accord and satisfaction, and the Landlord may accept such cheque or payment
without prejudice to the Landlord's right to recover the balance of such rent or
pursue any other remedy provided for in this lease.
11.13. OCCUPANCY PERMIT
The Tenant shall, at its own cost, be responsible to apply to the City in which
the Lands are located for an Occupancy Permit, upon possession of the Premises,
if required by such City.
11.14. SCHEDULES
The parties agree that Schedules "A", "B" and "C" annexed hereto form part of
this Lease and any provisions thereof shall be enforceable in the same manner as
the provisions of this Lease.
11.15. ENTIRE AGREEMENT
This lease and the schedules and riders, if any, attached set forth the entire
agreement between the Landlord and Tenant concerning the Premises. There are no
agreements or understandings between them other than as set out in this lease.
This lease and its schedules and riders, if any, may not be modified except by
agreement in writing executed by the Landlord and Tenant.
IN WITNESS WHEREOF the Landlord and Tenant have signed this lease.
The Landlord:
PENREAL PROPERTY FUND LTD.
Per: /s/Xxxx Usling
(Authorized signatory)
Per: /s/Xxxxxxx Xxxxxxxxxx
(Authorized signatory) c/s
The Tenant:
XXXXXXX SYSTEMS CANADA, LTD.
Per: /s/Xxxxxxxxxxx X. Xxxxxx
(Authorized Signatory)
Per: /s/C. Xxxx Xxxxxxx
(Authorized Signatory) c/s
SCHEDULE'A'
LEGAL DESCRIPTION AND SITE PLAN
The Tenant acknowledges that the purpose of this Schedule is solely to show the
approximate location of the Premises and it is not intended to be a
representation or warranty as to the exact location thereof.
LEGAL DESCRIPTION
Lots 12 and 13 and parts of Lots 10 and 11 Registered Plan 65M-2326 Town of
Markham, Regional Municipality of York.
SCHEDULE "B"
RULES AND REGULATIONS
1. The Tenant shall not do or permit anything to be done in the Premises, or
bring or keep anything therein which will in any way increase the risk of fire
or the rate of fire insurance on the Premises or on property kept therein, or
obstruct or interfere with the rights of other tenants or in any way injure or
annoy them, or violate or act at variance with the laws relating to fires or
with the regulations of the Fire Department or any governmental authority, or
with any insurance upon the Premises, or violate or act in conflict with any
statutes, rules and ordinances governing health standards or with any other
statute or municipal bylaw.
2. No inflammable oils or other inflammable, dangerous or explosive materials
save those approved in writing by the Landlord's insurers shall be kept or
permitted to be kept in the Premises.
3. The Tenant shall not place or maintain any supplies, inventory, equipment or
other articles or things of any kind whatsoever anywhere exterior to the
Building and shall not use any portion of the Lands for outside storage save and
except for the diesel generator required for the back-up electrical system for
the data centre portion of the Premises. The installation and maintenance of the
diesel generator must be in compliance with all applicable governmental laws,
by-laws and regulations and must be approved by the Landlord.
4. The Tenant shall not allow any accumulation of debris, garbage, trash or
refuse either in or outside of the Premises or Building or on the Lands and all
of same shall be kept in appropriate vermin-proof containers until removed. All
garbage, trash, rubbish and refuse shall be removed by the Tenant at its expense
on a regular basis. If the Tenant uses perishable articles or generates wet
garbage, the Tenant shall provide refrigerated storage facilities suitable to
the Landlord.
5. The Tenant shall maintain the Premises free of insects, rodents, vermin and
other pests and shall, if required at any time by the Landlord, take out and
maintain at its expense an appropriate pest and vermin control contract with
respect to the Premises with a person or corporation duly qualified to perform
such services.
6. The Tenant shall not cause or permit: any waste or damage to the Premises;
any overloading of the floors or the utility, electrical or mechanical
facilities of the Building; any nuisance in the Premises; or any use or manner
of use causing a hazard.
7. Except for the proper use of blinds and drapes, the Tenant shall not cover,
obstruct or affix any object or material to any of the skylights or windows of
the Premises which will either reflect or admit light into any part of the
Building including, but without limitation, the application of solar films. The
Landlord acknowledges that, as part of its Initial Leasehold Improvements, the
Tenant will be constructing a structure within the existing structure of the
Premises and, as such, the skylights or windows existing in the Premises as of
the date of this lease may be obscured.
8. The Tenant shall not use or permit the use of any objectionable advertising
medium such as, but without limitation, loudspeakers, phonographs, public
address systems, sound amplifiers, radio broadcast or television apparatus on
the Premises which is in any manner audible or visible outside of the Building.
9. Subject to the Tenant's right to use the diesel generator in the case of
power failure, the Tenant shall not permit or allow any odours, vapour, steam,
water, vibrations, noises or other undesirable effects to emanate from the
Premises or any equipment or any installation in the Premises which in the
Landlord's reasonable opinion are objectionable or cause any interference with
the safety, comfort or convenience of the Building to the Landlord or the
occupants or tenants thereof or their agents, servants, invitees or employees.
10. Subject to the Tenant's right to mount a microwave antenna as part of its
Initial Leasehold Improvements approved by the Landlord, the Tenant shall not
mount or place an antenna of any nature on the exterior of the Building or on
the Lands.
11. Subject to the Tenant's approved construction plans for its Initial
Leasehold Improvements, which include proposed coring for drainage, the Tenant
shall not deface or xxxx any part of the Building and shall not make
unreasonable use of nails, spikes, hooks or screws in the walls, floors,
ceilings or woodwork of any part of the Building or bore, drill or cut into the
walls, floors, ceilings or woodwork of any part of the Building in any manner.
12. If the Tenant requires telegraphic or telephonic connections the Landlord,
in its discretion, may direct the electricians as to where and how wires are to
be introduced into the Building. Subject to the Tenant's approved construction
plans for its Initial Leasehold Improvements, which include the relocation of
gas and water lines, no gas pipes or electric wiring will be permitted which has
not been ordered or authorized by the Landlord.
13. The water closets and other apparatus shall not be used for any purpose
other than those for which they were intended and no sweepings, rubbish, rags,
ashes or other substances shall be thrown into them. Any damage resulting from
misuse shall be borne by the Tenant.
14. No-one shall use the Premises for sleeping apartments or residential
purposes or for the storage of personal effects or articles other than those
required for business purposes.
15. No cooking or heating of foods or liquids (other than the heating of water
or coffee in coffee makers or kettles or the heating of food in a microwave
oven) shall be permitted in the Premises without the written consent of the
Landlord.
16. No animals or birds shall be brought into any part of the Building without
the consent of the Landlord.
17. When required by any governmental authority having jurisdiction the Tenant
will provide facilities or accommodation for garbage and waste and its disposal
and pick up in accordance with such requirements.
18. The Tenant shall have the right to use designated portions of the parking
areas on the Lands for the parking of passenger vehicles. Such parking areas
shall be used only for the parking of passenger vehicles and no part of the
parking areas, driveway, shipping areas or other parts of the Lands except as
designated by the Landlord, shall be used for the storage, repair and washing of
trucks, trailers, vans or similar vehicles. The Landlord shall have no
obligation to supervise police and control the use of the parking areas and, if
any portion of the parking areas has been designated for the Tenant's use. The
Tenant shall not park any vehicle or permit any vehicle to be parked overnight
at the Premises unless the occupant of the vehicle is working in the Premises
overnight.
19. All tenants must observe strict care not to allow their windows or doors to
remain open so as to admit rain or snow or so as to interfere with the heating
of the Building. Any injury or damage caused to the Building or its
appointments, furnishing heating and other appliances or to any other tenant by
reason of windows or doors being left open so as to admit rain or snow or by
interferences with or neglect of the heating appliances or by reason of the
tenant or other person or servant, subject to it, shall be made good by the
tenant in whose premises the neglect, interference or misconduct occurred.
SCHEDULE "C"
SPECIAL PROVISIONS
Expansion Space
Provided the Tenant has not been in habitual default and is not then in default
under the terms of the lease and Xxxxxxx Systems Canada, Ltd. is the Tenant and
is itself in occupation of and conducting business in the whole of the Premises
then, during the Term of the lease (including any extensions or renewals
thereof) if any space in the Building becomes available for re-leasing from the
Landlord ("Expansion Space"), the Landlord shall so notify the Tenant and the
Tenant shall have 5 days from receipt of such notice within which to confirm in
writing to the Landlord that it elects to exercise its right to lease the
Expansion Space. If the Tenant exercises its right hereunder it will have 15
days from the date of exercise within which to enter into a lease with the
Landlord on the Landlord's standard form of net industrial lease in effect for
the Building to confirm the terms of the leasing of the Expansion Space on terms
and conditions which are acceptable to both the Landlord and the Tenant, both
parties acting reasonably. If the Tenant fails to exercise its right within the
stipulated 5 day period, this option to lease Expansion Space shall be null and
void and of no further force or effect.
Protective Covenant
Provided the Tenant is not in default under the terms of the lease and Xxxxxxx
Systems Canada, Ltd. is the Tenant and is itself in occupation of and conducting
business in the whole of the Premises, then the Landlord agrees that it shall
ensure the integrity of the future business uses are restricted to the class and
use of the tenant base existing as at the Commencement Date. In any event, the
Landlord shall not lease space adjacent to the Premises to a tenant whose
business includes heavy use of machinery which could be expected to produce
excessive vibration or businesses which use explosive or corrosive chemical
products.
Option to Extend
Provided:
1 . the Tenant is not then and has not been in default under the terms of
the lease;
2. Xxxxxxx Systems Canada, Ltd. is the Tenant and is itself in occupation
of and conducting business in the whole of the Premises;
3. the Tenant has provided written notice to the Landlord no later than 6
months prior to the expiry of the initial Term of its intention to exercise the
within option to extend,
then the Tenant shall have a one time only option to extend the initial Term of
the lease for a further period of 5 years, such extension to begin upon the
expiration of the initial Term and the lease, and all of its terms shall
continue in force during such extension except that:
(a) the Tenant shall not be entitled to any further rent-free period,
Landlord's work, or financial inducement;
(b) the Tenant shall not have any further option to extend the Term
following the exercise, if any, of the foregoing option to extend; and
(c) during the extension, the Tenant shall pay a net rent to be agreed upon
by the Landlord and the Tenant prior to the commencement of such extension,
based on the fair market rental rate for comparable premises, calculated in a
comparable manner on a comparable net lease basis for comparable buildings in
the vicinity of the Building. In the event that such rental rate has not been
agreed upon by the parties 3 months prior to the commencement of the extension
then the net rental rate shall be determined by arbitration under the
Arbitration Act, 1991 of Ontario, as amended or replaced.
Failing written notification to the Landlord in accordance with paragraph 3
above, the foregoing option to extend shall be null and void.
The Landlord may require the Tenant to execute a lease amending agreement or, at
its option, its then standard net industrial lease in effect for the Building,
in order to confirm the terms of the foregoing option to extend.
Corporate Identification
The Tenant shall, at its own cost and expense, have the right to install its
sign graphics on the west wall of the Premises provided that such sign conforms
to all applicable governmental laws, by-laws, rules and regulations and the
Landlord's sign criteria for the Building.
