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Sample Business ContractsHome: Sample Business Contracts:
OCTOBER 19, 1998
DATED: October 19, 1998.
BETWEEN:
CIBC DEVELOPMENT CORPORATION
- AND -
LOYALTY MANAGEMENT GROUP CANADA INC.
5055 SATELLITE DRIVE
INDUSTRIAL LEASE AGREEMENT
Mississauga, Ontario
<PAGE>
5055 SATELLITE DRIVE, MISSISSAUGA, ONTARIO
INDUSTRIAL LEASE
TABLE OF CONTENTS
ARTICLE I - BASIC LEASE TERMS
Section 1.01 Variable Defined Terms
Section 1.02 Standard Definitions
ARTICLE II - LEASED PREMISES - TERM - RENT
Section 2.01 Leased Premises and Term
Section 2.02 Use of Additional Areas
Section 2.03 Construction of the Leased Premises
Section 2.04 Adjustment of Areas
Section 2.05 Agreement to Pay
Section 2.06 Basic Rent
Section 2.07 Late Payment Charge
Section 2.08 Net Lease
Section 2.09 Acknowledgement of Commencement Date
ARTICLE III - TAXES AND OPERATING COSTS
Section 3.01 Taxes Payable by Landlord
Section 3.02 Tenant's Share of Taxes
Section 3.03 Tenant's Proportionate Share of Operating Costs
Section 3.04 Management Fee
Section 3.05 Tenant's Taxes
Section 3.06 Tenant's Responsibility
Section 3.07 Payment of Estimated Taxes, Operating Costs & Management Fee
ARTICLE IV - COMPLEX - CONTROL AND SERVICES
Section 4.01 Control of the Complex by the Landlord
Section 4.02 Substitution
ARTICLE V - UTILITIES AND ADDITIONAL SERVICES
Section 5.01 Charges for Utilities
Section 5.02 Additional Services of the Landlord
Section 5.03 Third Party Services
ARTICLE VI - USE OF LEASED PREMISES
Section 6.01 Use of the Leased Premises
Section 6.02 Observance of Law
Section 6.03 Energy Conservation
Section 6.04 Odours, Dust or Noise
Section 6.05 Obstructions
Section 6.06 Outside Areas
Section 6.07 Environmental Law
ARTICLE VII - INSURANCE AND INDEMNITY
Section 7.01 Tenant's Insurance
Section 7.02 Increase in Insurance Premiums
Section 7.03 Cancellation of Insurance
Section 7.04 Loss or Damage
Section 7.05 Landlord's Insurance
Section 7.06 Indemnification of the Landlord
Section 7.07 Limitations of Liability
<PAGE>
ARTICLE VIII - MAINTENANCE, REPAIRS AND ALTERATIONS
Section 8.01 Maintenance and Repairs by the Tenant
Section 8.02 Landlord's Approval of the Tenant's Repairs
Section 8.03 Maintenance and Repairs by the Landlord
Section 8.04 Surrender of the Leased Premises
Section 8.05 Repair Where the Tenant is at Fault
Section 8.06 Tenant Not to Overload Facilities
Section 8.07 Tenant Not to Overload Floors
Section 8.08 Removal and Restoration by Tenant
Section 8.09 Notice by the Tenant
Section 8.10 Tenant to Discharge All Liens
Section 8.11 Signs and Advertising
ARTICLE IX - DAMAGE AND DESTRUCTION
Section 9.01 Destruction of the Leased Premises
Section 9.02 Destruction of the Complex
Section 9.03 Abrogation
ARTICLE X - TRANSFER AND SALE
Section 10.01 Assigning and Subletting
Section 10.02 Landlord's Right to Terminate
Section 10.03 Conditions of Transfer
Section 10.04 No Advertising of the Leased Premises
Section 10.05 Corporate Ownership
Section 10.06 Assignment by the Landlord
Section 10.07 Transfer Without Consent
ARTICLE XI - ACCESS AND ALTERATIONS
Section 11.01 Right of Entry
Section 11.02 Right to Show Leased Premises
Section 11.03 Entry Not Forfeiture
Section 11.04 Landlord's Covenant For Quiet Enjoyment
Section 11.05 Inspection
ARTICLE XII - STATUS STATEMENT, ATTORNMENT AND SUBORDINATION
Section 12.01 Status Statement
Section 12.02 Subordination and Attornment
Section 12.03 Attorney
Section 12.04 Financial information
Section 12.05 Acknowledgment of Title
ARTICLE XIII - DEFAULT
Section 13.01 Right to Re-Enter
Section 13.02 Right to Re-Let
Section 13.03 Termination
Section 13.04 Accelerated Rent
section 13.05 Expenses
Section 13.06 Waiver of Exemption from Distress
Section 13.07 Landlord May Cure Tenant's Default or Perform Tenant's
Covenants
Section 13.08 Additional Rent
Section 13.09 Remedies Generally
Section 13.10 Holding Over
Section 13.11 No Waiver
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ARTICLE XIV - MISCELLANEOUS
Section 14.01 Rules and Regulations
Section 14.02 Security Deposit
Section 14.03 Pest Control
Section 14.04 Obligations as Covenants
Section 14.05 Amendments and Supplementary Lease Provisions
Section 14.06 Certificates
Section 14.07 Time
Section 14.08 Successors and Assigns
Section 14.09 Governing Law
Section 14.10 Headings
Section 14.11 Entire Agreement
Section 14.12 Severability
Section 14.13 No Option
Section 14.14 Occupancy Permit
Section 14.15 Place for Payments
Section 14.16 Extended Meanings
Section 14.17 No Partnership or Agency
Section 14.18 Unavoidable Delay
Section 14.19 Registration
Section 14.20 Joint & Several Liability
Section 14.21 Name of Complex
Section 14.22 Changes in Complex
Section 14.23 Compliance with the Planning Act
ARTICLE XV - INDEMNITY AGREEMENT - INTENTIONALLY DELETED
Section 15.01 Indemnity - Intentionally Deleted
Section 15.02 Further Assurances - Intentionally Deleted
SCHEDULES
Schedule "A" - Legal Description of Lands
Schedule "B" - Plan Showing Location of Leased Premises
Schedule "C" - Rules and Regulations
Schedule "D" - Acknowledgement of Commencement Date
Schedule "E" - Supplementary Lease Provisions
1. Tenant's Option to Terminate
2. Tenant's Option to Renew
3. Tenant's First Right to Lease
4. Parking
5. Communications Equipment
6. Access to the Leased Premises
7. Business Days
iii
<PAGE>
5055 SATELLITE DRIVE, MISSISSAUGA
INDUSTRIAL LEASE
ARTICLE 1
BASIC LEASE TERMS
SECTION 1.01 - VARIABLE DEFINED TERMS
In this Lease the following terms will have the following meanings:
(1) "LEASE" means this lease dated the 19TH DAY OF OCTOBER, 1998, and
includes all schedules annexed hereto, as from time to time amended in
writing.
(2) "LANDLORD" - CIBC DEVELOPMENT CORPORATION and its successors and
assigns.
(3) "LANDLORD'S ADDRESS" - Suite 2800, 145 King Street West, Toronto,
Ontario, M5H 3T7 or such other address as is designated by the Landlord
in Canada.
(4) "TENANT" - LOYALTY MANAGEMENT GROUP CANADA INC. and its successors and
permitted assigns.
(5) "TENANT'S ADDRESS" - 4110 YONGE STREET, SUITE 200, TORONTO, ONTARIO,
M2P 2B7, ATTENTION: VICE PRESIDENT, LEGAL SERVICES or such other
address as is designated by the Tenant in Canada.
(6) "INDEMNIFIER" - INTENTIONALLY DELETED.
(7) "INDEMNIFIER'S ADDRESS" - INTENTIONALLY DELETED.
(8) "LEASED PREMISES" - Those premises leased to the Tenant pursuant to
Section 2.01 hereof, cross-hatched on Schedule "B" hereto, being the
part of the building known as 5055 Satellite Drive, Mississauga,
Ontario.
(9) "RENTABLE AREA OF THE LEASED PREMISES" - The Rentable Area of the
Leased Premises being approximately 40,000 square feet of area
determined in accordance with Section 1.02 (21) hereof, and subject to
adjustment in accordance with Section 2.04 hereof.
(10) "BASIC RENT" - Basic Rent per square foot of Rentable Area of the
Leased Premises per annum payable pursuant to Section 2.06 hereof shall
be as follows:
(a) TWELVE DOLLARS AND SEVENTY-FIVE CENTS ($12.75) IN THE FIRST
(1ST) AND SECOND (2ND) YEARS OF THE TERM;
(b) THIRTEEN DOLLARS AND FIFTY CENTS ($13.50) IN THE THIRD (3RD),
FOURTH (4TH) AND FIFTH (5TH) YEARS OF THE TERM;
(c) FOURTEEN DOLLARS AND EIGHTY-FIVE CENTS ($14.85) IN THE SIXTH
(6TH), SEVENTH (7TH) EIGHTH (8TH), NINTH (9TH) AND TENTH
(10TH) YEARS OF THE TERM.
(11) "COMMENCEMENT DATE" - AUGUST 1, 1999 (SUBJECT TO DELAYS AS DESCRIBED
IN PARAGRAPH 27 OF THE AGREEMENT TO LEASE).
(12) "TERM" - TEN (10) YEARS (SUBJECT TO THE PROVISIONS OF PARAGRAPH 1 OF
SCHEDULE "E" OF THIS LEASE), COMMENCING ON THE COMMENCEMENT DATE.
(13) "AGREEMENT TO LEASE" means, COLLECTIVELY, the written agreement to
lease between the Landlord and the Tenant with respect to the Leased
Premises ACCEPTED BY THE LANDLORD AND THE TENANT ON THE 11TH DAY OF
AUGUST, 1998 (THE "OFFER TO LEASE"), AS AMENDED BY AN AMENDING LETTER
DATED THE 2ND DAY OF SEPTEMBER, 1998 (THE "AMENDING LETTER").
(14) "SECURITY DEPOSIT" means the sum of ONE HUNDRED AND FORTY-FIVE THOUSAND
DOLLARS ($145,000.00) + GST (WITH ALL INTEREST ACCRUED THEREON) applied
in accordance with Section 14.02.
(15) "TYPE OF BUSINESS OF THE TENANT" means for the purpose OF GENERAL
BUSINESS OFFICES, INCLUDING AN OUT-BOUND AND IN-BOUND CALL CENTRE AND
EMPLOYEE CAFETERIA, PROVIDED THAT SUCH USE COMPLIES WITH ALL APPLICABLE
BY-LAWS.
<PAGE>
SECTION 1.02 - STANDARD DEFINITIONS
(1) "ADDITIONAL RENT" means all sums of money, other than Basic Rent, which
are required to be paid by the Tenant TO THE LANDLORD pursuant to any
provision of this Lease.
(2) "ADDITIONAL SERVICE" means any service which is requested or required
by or for a tenant (including the Tenant) in addition to those supplied
by the Landlord as part of the normal services provided in the Complex,
and which the Landlord is prepared or elects to supply at an additional
cost to the tenant in question and includes, without limitation,
janitor and cleaning services, the provision of labour and supervision
in connection with deliveries, supervision in connection with the
moving of any furniture or equipment of any tenant, the making of any
repairs or alterations by any tenant and the cost of replacing building
standard electric light fixtures, ballasts, tubes, starters, lamps and
light bulbs not located within Common Facilities.
(3) "ADDITIONAL SERVICE COST" means the additional cost payable by the
Tenant to the Landlord for any Additional Service in accordance with
Section 5.02 hereof.
(4) "ARCHITECT" means the architect, professional engineer or surveyor
named by the Landlord from time to time.
(5) "BANK RATE" means the interest rate per annum as announced by the
chartered bank of the Landlord at the principal office of such bank in
Toronto and reported by it to the Bank of Canada as its prime rate.
(6) "CAPITAL TAX IN RESPECT OF THE COMPLEX" means the aggregate of:
(a) an amount of the tax or excise imposed by the Province of
Ontario upon the Landlord or the owners of the Complex which
is measured by or based in whole or in part upon the capital,
surplus, reserves or indebtedness of such Landlord or owners,
and which is at present based upon the application of the
prescribed rate of 0.3 % to the amount of such Landlord's or
owner's "taxable paid-up capital" as defined in the
Corporations Tax Act (Ontario); the amount of the tax or
excise for the purposes hereof shall be calculated in any year
as if the Complex was the only establishment in the Province
of Ontario owned by such Landlord or owners in the year and
such Landlord or owners had no establishment other than in the
Province of Ontario; and
(b) an amount of the tax or excise imposed by the Government of
Canada upon the Landlord or the owners of the Complex which is
measured by or based in whole or in part upon the capital,
surplus, reserves or indebtedness of the Landlord or the
owners, and which tax is at present based upon the application
of the prescribed rate of .2% to the amount by which the
"taxable capital employed in Canada" by such Landlord or
owners as defined in the Income Tax Act (Canada) exceeds its
capital deduction for the year; the amount of the tax or
excise for the purposes hereof shall be calculated in any year
as if the Complex was the only asset owned by such Landlord or
owners in the year and the capital deduction of such Landlord
or owners for the year was nil.
(7) "COMMON FACILITIES" means those areas and facilities of or for the
Complex which serve or benefit the Complex including, without
limitation, roadways, landscaped areas, sidewalks, public entrance
doors, halls, public lobbies, lavatories, stairways, passageways,
service ramps and Common Use Equipment, and which are designated from
time to time by the Landlord for the common use or enjoyment of the
tenants in the Complex and users of adjacent properties, and their
agents, invitees, servants, employees and licensees, or for use by the
public, but excluding rentable premises in the Complex and other
portions of the Complex which are from time to time designated by the
Landlord ACTING REASONABLY for private use by one or a limited group of
tenants.
(8) "COMMON USE EQUIPMENT " means all mechanical, plumbing, electrical and
heating, ventilating, and air-conditioning equipment, pipes, ducts,
wiring, machinery and equipment and other integral services, utility
connections and the like providing services to the Complex, including
such services to and within rentable premises (it being understood that
any changes to such services made by or on behalf of the Tenant shall
be considered to be Leasehold Improvements).
(9) "COMPLEX" means the Lands and the buildings and other fixed
improvements located thereon and includes all structures and
improvements from time to time thereunder or associated therewith.
(10) "INSURANCE COST" means, for any fiscal period, the total cost to the
Landlord calculated in accordance with generally accepted accounting
principles, for insuring the Complex.
(11) "INSURED DAMAGE" means that part of any damage occurring to the
Complex, including the Leased Premises, of which the entire cost of
repair (except as to any deductible amount provided for in the
applicable policy or policies of insurance) is actually recovered by
the Landlord under a policy or policies of insurance from time to time
effected by the Landlord pursuant hereto, OR WOULD HAVE BEEN
RECOVERABLE BY THE LANDLORD OR ANY ASSIGNEE TO WHOM THE LANDLORD HAS
ASSIGNED
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THE INSURANCE PROCEEDS, ACTING REASONABLY, HAD THE LANDLORD INSURED AS
IT IS REQUIRED BY THIS LEASE.
(12) "LANDS" means the lands described in Schedule "A" attached hereto and
includes other lands designated by the Landlord as part of 5055
Satellite Drive in which the Landlord from time to time has an
interest.
(13) "LEASEHOLD IMPROVEMENTS" means all items generally considered as
leasehold improvements, including, without limitation, all fixtures,
equipment, improvements, installations, alterations and additions from
time to time made, erected or installed by or on behalf of the Tenant,
or any previous occupant of the Leased Premises in the Leased Premises,
and by or on behalf of other tenants in other premises in the Complex,
including all partitions, however affixed and whether or not movable,
and all wall-to-wall carpeting other than carpeting laid over finished
floors and affixed so as to be readily removable without damage and
changes to services which are part of Common Use Equipment; but
excluding trade fixtures, furniture or free-standing partitions and
equipment not of the nature of trade fixtures.
(14) "MANAGEMENT FEE" means a reasonable fee for the administration and
management of the Complex applied to the aggregate of all revenues
received or receivable from the Tenant, which fee shall be comparable
to fees charged by management companies for managing and administering
developments similar to the Complex;
(15) "MORTGAGE" means any instrument hypothec, deed of trust, document or
security interest (resulting from any method of financing or
refinancing) or blanket mortgage pledge or charge (affecting the
Complex as well as other property) now or hereafter secured upon the
Complex or any part thereof, and includes all renewals, modifications,
consolidations, replacements and extensions thereof.
(16) "MORTGAGEE" means the mortgagee, hypothecary or other creditor or
trustee for bondholders or others named in any Mortgage.
(17) "NOTICE" means any notice, statement, consent, approval, demand or
request herein required or permitted to be given by any party to
another pursuant to this Lease and shall be in writing and, if to the
Landlord, addressed to the Landlord at the Landlord's Address, if to
the Tenant, addressed to the Tenant at the Tenant's Address, and if to
the Indemnifier, addressed to the Indemnifier at the Indemnifier's
Address. All Notices shall be hand-delivered and the effective date of
such Notices shall be the date of delivery.
(18) "OPERATING COSTS" means, the total of all expenses, costs, fees,
rentals, disbursements and outlays of every kind paid, payable or
incurred by or on behalf of the Landlord in the complete maintenance,
repair, operation, supervision, replacement and administration of the
Complex, ON A REASONABLE, FAIR AND EQUITABLE BASIS, ACTING AS A
REASONABLE AND PRUDENT ADMINISTRATOR OF A FIRST CLASS INDUSTRIAL
BUILDING LOCATED IN MISSISSAUGA, ONTARIO AND CONFORMING WITH GENERALLY
ACCEPTED ACCOUNTING PRINCIPLES, CONSISTENTLY APPLIED, and a reasonable
amount, as determined by the Landlord from time to time, for all
expenses incurred by or on behalf of tenants in the Complex with whom
the Landlord may from time to time have agreements whereby, in respect
of their premises, those tenants perform any cleaning, maintenance or
other work, utilities or services usually performed or provided by the
Landlord which, if directly incurred by the Landlord, would have been
included in Operating Costs. Without limiting the generality of the
foregoing, Operating Costs shall include, without duplication:
(A) (i) the Insurance Cost;
(ii) the cost of providing security, supervision, life safety
systems, traffic control, landscaping, exterior cleaning and
snow removal services;
(iii) the cost of repairs and replacements to and maintenance of the
Complex in each case in respect of the Common Facilities but
excluding the original capital cost of same AND NET OF AMOUNTS
IN 1.02)(18)(B)(v) AND (vi);
(iv) the cost of hot and cold water, electric light and power,
telephone, steam, gas, sewage disposal and other utilities and
services;
(v) the cost of maintaining and replacing general signs and
directory boards;
(vi) accounting costs incurred in connection with the maintenance,
repair, replacement, operation, administration or management
of the Complex, including computations required for the
imposition of charges to tenants, the cost of preparing
statements and opinions for tenants and banking fees and
expenses and audit fees;
(vii) the cost of performing its obligations under Section 8.03;
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(viii) the fair rental value (HAVING REGARD TO THE RENTALS PREVAILING
AT THE TIME THE SPACE IS ESTABLISHED FOR USE BY THE LANDLORD
FOR A TERM OF FIVE (5) YEARS AND THEREAFTER RENTALS PREVAILING
ON THE BASIS OF TERMS NOT LESS THAN FIVE (5) YEARS) of space
in the Complex used by the Landlord, acting reasonably, in
connection with the maintenance, repair, replacement,
operation, administration or management of the Complex;
(ix) all other indirect expenses to the extent allocable to the
maintenance, repair, replacement, operation, administration or
management of the Complex;
(x) all costs and expenses (including legal and other professional
fees and interest and penalties on deferred payments) incurred
by the Landlord in contesting, resisting or appealing any
Taxes;
(xi) the amount of all salaries, wages and fringe benefits paid to
or for personnel, managers, and superintendents, wherever
located, to the extent that they are employed or retained by
or on behalf of the Landlord in connection with the
maintenance, repair, replacement, operation, administration or
management of the Complex and all amounts paid to independent
contractors for any services in connection with the
maintenance, repair, replacement, operation, administration or
management of the Complex or any part of it;
(xii) fees and expenses of architects, engineers, quantity surveyors
and other consultants retained by the Landlord EXCLUDING FEES
AND EXPENSES RELATING TO THE MEASUREMENT OF THE RENTABLE AREA
OF THE LEASED PREMISES;
(xiii) the costs of uniforms for personnel, and of supplies, tools,
equipment and materials used in connection with the
maintenance, repair, replacement, operation, administration,
management or caretaking of the Complex;
(xiv) amortization of the costs OTHER THAN THE COSTS OF LANDLORD'S
WORK (AS DEFINED IN THE AGREEMENT TO LEASE) incurred to make
alterations, replacements or additions to the Complex intended
to reduce the cost of other items included in Operating Costs,
improve the operation of the Complex or maintain its operation
as a quality industrial complex; costs being amortized will
include, without limitation, costs incurred in respect of
alterations, replacements or additions to the roof and other
machinery, equipment, facilities, decorating, flooring,
systems, and property installed in or used in connection with
the Complex (except to the extent that the costs are charged
fully to income account in the accounting period in which they
are incurred) and interest on the unamortized portion of the
original cost of such items being amortized, payable monthly,
from or after the date on which the relevant cost was incurred
at an annual rate of interest that is one percentage (1%)
point above the Bank Rate in effect from time to time; the
amortization costs and interest charged under this clause
shall be calculated by the Landlord, acting reasonably, in
accordance with sound and generally accepted accounting
principles, but no amortization or interest will be charged in
respect of any such items installed in conjunction with the
original construction of the Complex;
(xv) goods and services taxes, business transfer taxes, value-added
taxes, multi-stage sales taxes, sales, use or consumption
taxes and any like taxes on property and services provided by
or on behalf of the Landlord except to the extent recoverable
by the Landlord;
(xvi) Capital Tax in respect of the Complex, any Ontario commercial
concentration tax and any business or similar taxes or licence
fees in respect of the business of the Landlord which pertains
to the management, operation and maintenance of the Complex;
(xvii) all other direct and indirect costs and expenses of every
kind, to the extent incurred in or allocable to the
maintenance, repair, replacement, operation, supervision or
administration of all or any part of the Complex, or any of
its appurtenances including expenses incurred or contributions
made by the Landlord in respect of off-site facilities which
are utilized by or benefit the Complex or for which the
Landlord is required to contribute;
(B) except to the extent otherwise provided in Part (A) of this definition,
Operating Costs shall exclude or shall have deducted therefrom:
(i) Taxes and Management Fee;
(ii) THE COST OF ARRANGING, AND debt service in respect of
financing secured by or related to the Complex AND THE CAPITAL
RETIREMENT OF DEBT and interest on debt save for interest
payable if as and when costs and expenses in respect of
Operating Costs and Taxes and goods and services taxes
temporarily exceed recoveries from time to time in respect
thereof;
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(iii) depreciation of the initial cost of the Complex;
(iv) the cost of replacing building standard electric fixtures,
ballasts, tubes, starters, lamps and light bulbs in each case
not located within Common Facilities;
(v) an amount equal to the net proceeds of insurance actually
recovered by the Landlord OR ANY ASSIGNEE TO WHOM THE LANDLORD
HAS ASSIGNED THE INSURANCE PROCEEDS (OR WHICH WOULD HAVE BEEN
RECOVERED BY THE LANDLORD HAD THE LANDLORD INSURED AS IT IS
REQUIRED) for damage to the Complex to the extent that the
cost to repair such damage is included in Operating Costs;
(vi) an amount equal to recoveries by the Landlord in respect of
warranties or guarantees relating to repairs or alterations to
the Complex or any part of it, to the extent that the repair
or alteration costs in respect of the work covered by warranty
or guarantee is included in Operating Costs;
(vii) all Additional Service Costs chargeable to specific tenants of
the Complex for Additional Service to the extent that those
amounts are included in Operating Costs, including any
administrative or overhead charges;
(viii) an amount equal to the contribution made by owners or
occupants of adjacent buildings who are, by agreement,
entitled to use any facilities of and for the Complex;
(ix) THE COST OF COMMISSIONS, ADVERTISING AND LEGAL EXPENSES IN
CONNECTION WITH THE LEASING OF THE COMPLEX;
(x) BAD DEBTS AND ANY COSTS INCURRED IN THE COLLECTION OF SUCH BAD
DEBTS, INCLUDING LEGAL COSTS ASSOCIATED WITH THE SAME;
(xi) ANY AMOUNT DUE TO THE LANDLORD'S NON-COMPLIANCE WITH ANY LAW,
BY-LAW, REGULATION, OR ACT;
(xii) THE COST OF SERVICES, INCLUDING WITHOUT LIMITATION, JANITORIAL
SERVICES, THAT THE TENANT ITSELF SUPPLIES OR CONTRACTS FOR
WITH A SUPPLIER OTHER THAN THE LANDLORD AND WHICH WOULD
OTHERWISE BE INCLUDING IN OPERATING COSTS; AND
(xiii) THE COST OF JANITORIAL SERVICES SUPPLIED BY THE LANDLORD TO
TENANTS IN THE COMPLEX;
(C) any costs that are not directly incurred by the Landlord but are
chargeable as Operating Costs may be estimated by the Landlord on a
reasonable basis to the extent that the Landlord cannot ascertain the
exact amount; and
(D) the taxes enumerated in Section 1.02(18)(A)(xv) above are included
amongst Operating Costs upon the understanding that the Landlord will
look first for reimbursement of such taxes to its input tax credits in
the case of the goods and services tax in force at the date hereof, and
to corresponding credits, if any, in the case of subsequent taxes from
time to time in force, the intent being that so long as such credits
are available to the Landlord the taxes referred to in Section
1.02(18)(A)(xv) will not be included in Operating Costs.
(19) "PROPORTIONATE SHARE" means, for any period, the fraction which has as
its numerator the Rentable Area of the Leased Premises and as its
denominator the Total Rentable Area.
(20) "RENT" means Basic Rent and Additional Rent.
(21) "RENTABLE AREA" of any portion of the Complex means the floor area
THEREOF MEASURED IN ACCORDANCE WITH THE BOMA STANDARD METHOD FOR
MEASURING FLOOR SPACE IN INDUSTRIAL BUILDINGS expressed in square feet
of all floor space (including the floor space of mezzanines, if any)
measured from the exterior face of all exterior walls (and across the
extension of the planes thereof over the openings for doors and
windows) comprising the boundaries of such premises and, in the case of
walls separating any rentable premises from adjoining rentable
premises, measured from the centre line of such walls but ignoring the
finished treatment thereof; any such area shall be adjusted from time
to time to reflect any addition, reduction, rearrangement or relocation
of space.
(22) "TAXES" means all taxes, rates, duties, levies, fees, charges, sewer
levies, local improvement rates, and assessments whatsoever imposed,
assessed, levied or charged, now or in the future, by any school,
municipal, regional, provincial, federal, parliamentary or other
governmental body, corporate authority, agency or commission
(including, without limitation, school boards and utility commissions),
against the Complex or any part thereof, and/or the Landlord and/or the
owners of the Complex in connection therewith, calculated on the basis
of the Complex being assessed as a fully leased and operational
building, but excluding (unless specifically referred to above):
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(a) income or profit taxes upon the income of the Landlord to the
extent such taxes are not levied in substitution or in lieu of
any of the foregoing;
(b) business or similar taxes or licence fees in respect of the
business of the Landlord which pertains to the management,
operation and maintenance of the Complex (and which are
included in Operating Costs);
(c) goods and services taxes or similar taxes (and which are
payable pursuant to other provisions of this Lease);
(d) business or similar taxes or licence fees in respect of any
business carried on by, and imposed upon, tenants and
occupants (including the Tenant) of the Complex; and
(e) Capital Tax in respect of the Complex and any Ontario
commercial concentration tax (and which are included in
Operating Costs).
(23) "TENANT'S TAXES" means all taxes, rates, duties, levies or license fees
imposed upon the Tenant which are attributable to the business, income
or occupancy of the Tenant or any other occupant of the Leased
Premises, and to the use of any of the Common Facilities by the Tenant
or other occupant of the Leased Premises, including any taxes, rates,
duties, levies or license fees which are imposed in lieu of or in
addition to any such Tenant's Taxes; and if any such Tenant's Taxes are
levied against the Landlord or any owner on account of its ownership in
the Complex or its interest therein, they shall be included in Taxes.
(24) "TOTAL RENTABLE AREA" means the aggregate of all Rentable Area
(including the Leased Premises) in the Complex determined in accordance
with Section 1.02(21) hereof and adjusted from time to time to reflect
any addition, reduction, rearrangement or relocation of space.
(25) "TRANSFER" means an assignment of this Lease, a sublease of all or any
part of the Leased Premises, any transaction whereby the rights of the
Tenant under this Lease to the Leased Premises are transferred to
another, any transaction by which any right of use or occupancy of all
or any part of the Leased Premises is conferred upon anyone, any
mortgage, charge or encumbrance of this Lease or the Leased Premises or
any part thereof, or other arrangement under which either this Lease or
the Leased Premises becomes security for any indebtedness or other
obligations, and includes any transaction or occurrence whatsoever
which has changed or might change the identity of the person or persons
having lawful use or occupancy of any part of the Leased Premises.
(26) "UNAVOIDABLE DELAY" means any delay by a party in the performance of
its obligation under this Lease caused in whole or in part by any acts
of God, strikes, lockouts or other industrial disturbances, acts of
public enemies, sabotage, war, blockades, insurrections, riots,
epidemics, washouts, nuclear and radiation activity or fallout,
arrests, civil disturbances, explosions, breakage of or accident to
machinery, any legislative, administrative or judicial action which has
been resisted in good faith by all reasonable legal means, any act,
omission or event, whether of the kind herein enumerated or otherwise,
not within the control of such party, and which, by the exercise of
control of such party, could not have been prevented, but lack of funds
on the part of such party shall not constitute an Unavoidable Delay.
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ARTICLE II
LEASED PREMISES - TERM - RENT
SECTION 2.01 - LEASED PREMISES AND TERM
In consideration of the rents, covenants and agreements herein
contained on the part of the Tenant to be paid, observed and performed, the
Landlord leases to the Tenant, and the Tenant leases from the Landlord, the
Leased Premises for the Term.
SECTION 2.02 - USE OF ADDITIONAL AREAS
The use and occupation by the Tenant of the Leased Premises includes
for the purposes of carrying on its business, the non-exclusive right of the
Tenant, the Tenant's employees, agents, invitees, suppliers (subject to the
Rules and Regulations) and persons having business with the Tenant in common
with the Landlord, its other tenants, sub-tenants and all others entitled or
permitted to the use of the Common Facilities.
SECTION 2.03 - CONSTRUCTION OF THE LEASED PREMISES
The provisions THE LAST PARAGRAPH OF PARAGRAPH 2 (TERM) AND PARAGRAPHS
9 (LANDLORD'S WORK), 10 (TENANT'S WORK), 11 (LEASEHOLD IMPROVEMENT ALLOWANCE),
11A (WORKING DRAWINGS), 11B (PERMITS AND APPROVALS), 11C (EARLY ACCESS), 27
(UNAVOIDABLE DELAY) AND SCHEDULE "C" (LANDLORD'S WORK) OF THE OFFER TO LEASE AND
PARAGRAPHS 1, 2, 3, AND 4 OF THE AMENDING LETTER relating to construction of the
Leased Premises and delay in availability of the Leased Premises for occupancy
by the Tenant shall remain in effect and shall not merge upon the execution of
this Lease. The Tenant shall abide by the provisions of Section 8.02 in respect
of the construction of Leasehold Improvements and fixtures in the Leased
Premises following the commencement of the Term.
SECTION 2.04 - ADJUSTMENT OF AREAS
The Landlord may from time to time re-measure or re-calculate the
Rentable Area of the Leased Premises and may re-adjust the Basic Rent or the
amount of Additional Rent accordingly. The effective date of any such
re-adjustment shall:
(a) in the case of an adjustment to the Rentable Area resulting
from a change in the aggregate of all rentable premises on the
floor on which the Leased Premises are situated, be the date
on which such change occurred; and
(b) in the case of a correction to any measurement or calculation
error, be the first date as of which such error was discovered
in the calculation of Basic Rent or Additional Rent.
THE LANDLORD, AT ITS COST, SHALL WITHIN TWENTY (20) BUSINESS DAYS OF
THE COMMENCEMENT DATE, PROVIDE TO THE TENANT A COPY OF THE CERTIFICATE OF THE
LANDLORD'S ARCHITECT AS TO THE RENTABLE AREA OF THE LEASED PREMISES CALCULATED
IN ACCORDANCE WITH THE TERMS OF THIS LEASE CALCULATED IN ACCORDANCE WITH THE
TERMS OF THIS LEASE, AND THE PARTIES AGREE TO BE BOUND THEREBY, AND THE
PROVISIONS OF SECTION 2.04 SHALL HAVE NO FURTHER FORCE OR EFFECT WITH RESPECT TO
THE LEASED PREMISES LEASED TO THE TENANT AS AT THE COMMENCEMENT DATE.
SECTION 2.05 - AGREEMENT TO PAY
The Tenant shall pay Basic Rent and Additional Rent as herein provided
in lawful money of Canada, without any prior demand therefor and without any
deduction, abatement, set-off or compensation whatsoever save as provided in
Section 9.01. The Tenant agrees to pay to the Landlord in addition to Basic Rent
and Additional Rent, any goods and services tax, business transfer tax,
value-added tax, multi-stage sales tax, sales, use or consumption tax, or any
like tax imposed by any governmental authority in respect of this Lease or in
respect of any property or services provided hereunder, including, without
limitation, such taxes calculated on or in respect of any Rent (whether Basic
Rent or Additional Rent) payable under this Lease; any such tax shall be deemed
not to be Rent, but the Landlord shall have the same remedies for and rights of
recovery of such amount as it has for recovery of Rent under this Lease. The
obligation to pay Additional Rent (and adjustments thereto) shall survive the
expiration or sooner termination of this Lease. All amounts payable under this
Lease, unless otherwise provided, become due with the next instalment of Basic
Rent. The Landlord may, at its option, upon Notice to the Tenant direct that the
Tenant pay any or all Rent by way of pre-authorized bank debit and/or to any
other party specified by the Landlord.
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SECTION 2.06 - BASIC RENT
The Tenant shall pay from and after the Commencement Date to the
Landlord the Basic Rent, such Basic Rent to be computed in accordance with
Section 1.01(10) hereof and payable in equal monthly instalments in advance on
the first day of each and every month. WITHIN 20 BUSINESS DAYS AFTER THE
COMMENCEMENT DATE, the Landlord shall PROVIDE THE TENANT WITH A CERTIFICATE OF
THE LANDLORD'S ARCHITECT AS TO the Rentable Area of the Leased Premises and only
at such time shall any necessary adjustments in the Basic Rent and Additional
Rent be made.
If the Commencement Date is not the first day of a calendar month, then
the Basic Rent for the first and last months of the Term shall be appropriately
adjusted, on a per diem basis, based upon a period of three hundred and
sixty-five (365) days, and the Tenant shall pay upon the Commencement Date, the
portion of the Basic Rent so adjusted from the Commencement Date to the end of
the month in which the Commencement Date occurs.
SECTION 2.07 - LATE PAYMENT CHARGE
The Tenant hereby acknowledges that late payment by the Tenant to the
Landlord of Basic Rent or Additional Rent due hereunder will cause the Landlord
to incur costs not contemplated by this Lease, the exact amount of which will be
difficult or impracticable to ascertain. Such costs include, but are not limited
to, processing and accounting charges and late charges which may be imposed on
the Landlord by the terms of any Mortgage. Accordingly, if any Basic Rent or
Additional Rent shall not be received by the Landlord or the Landlord's designee
within five (5) days after such amount shall be due, AND, IF, IN THE OPINION OF
THE LANDLORD, ACTING REASONABLY, THE TENANT HAS BEEN HABITUALLY LATE IN THE
PAYMENT OF BASIC RENT AND/OR ADDITIONAL RENT HEREUNDER, the Tenant shall pay to
the Landlord a late charge equal to five per cent (5%) of such overdue amount.
The parties hereby agree that such late charge represents a fair and reasonable
estimate of the costs the Landlord will incur by reason of late payment by the
Tenant. Acceptance of such late charge by the Landlord shall in no event
constitute a waiver of the Tenant's default with respect to such overdue amount,
nor prevent the Landlord from exercising any of the other rights and remedies
granted hereunder. The foregoing shall be without prejudice to any other right
or remedy available to the Landlord under or pursuant to this Lease by reason of
a monetary default by the Tenant. The Tenant agrees that if any of the Tenant's
cheques are returned for lack of sufficient funds the Tenant shall pay to the
Landlord upon demand a minimum administrative fee of not less than Twenty-five
Dollars ($25.00).
SECTION 2.08 - NET LEASE
The Basic Rent payable under this Lease is intended to be an absolutely
net return to the Landlord, except as expressly herein set out to the contrary.
The Landlord is not responsible for any expenses or outlays of any nature
arising from or relating to the Leased Premises, or the use or occupancy
thereof, or the contents thereof or the business carried on therein. The Tenant
shall pay all charges, impositions and outlays of every nature and kind relating
to the Leased Premises except as expressly herein set out to the contrary.
SECTION 2.09 - ACKNOWLEDGMENT OF COMMENCEMENT DATE
The Tenant agrees to execute and return to the Landlord, within fifteen
(15) days of written demand from the Landlord, an acknowledgment of the
Commencement Date in the form set forth in Schedule "C" annexed hereto, subject
to such variations as the facts require.
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ARTICLE III
TAXES, OPERATING COSTS & MANAGEMENT FEE
SECTION 3.01 - TAXES PAYABLE BY LANDLORD
The Landlord shall pay directly to the appropriate and lawful taxing
authorities all Taxes subject to Sections 3.02 and 3.05 hereof. The Landlord may
contest any Taxes and appeal any assessments with respect thereto; withdraw any
such contest or appeal; and agree with the taxing authorities on any settlement
or compromise with respect to Taxes.
SECTION 3.02 - TENANT'S SHARE OF TAXES
The Tenant shall pay to the Landlord as Additional Rent a share of all
Taxes which share shall be the amount which is the aggregate, without
duplication, of either:
(1) (a) the amount obtained by multiplying the appropriate
commercial mill rate or rates for the year by the
assessed value of the Leased Premises as determined
by the lawful authority; provided that if for any
year such assessed value of the Leased Premises is
not available, then the Landlord may determine the
assessed value on an equitable basis using such
information and data as is available; and
(b) the Tenant's Proportionate Share of Taxes, if any,
allocated to any part of the Complex that is not
charged to the Tenant and other tenants pursuant to
Section 3.02(1)(a) and similar provisions in the
leases of such other tenants; or
(2) the Tenant's Proportionate Share of the Taxes assessed against
the Complex, including a portion of the Taxes attributable to
the Common Facilities and allocated to the Complex by the
Landlord. The amounts of such assessment and allocation, if
not determined by allocation or apportionment and identified
as such to the Landlord by the appropriate and lawful taxing
authority in question, shall be determined by allocation or
apportionment by the Landlord from time to time on an
equitable basis having regard, amongst other things, to
general principles of assessment.
If the Tenant elects to be assessed as a separate school supporter, the
Tenant will pay to the Landlord, in addition to any other amounts owing pursuant
to this Section 3.02, the excess, if any, of the separate school taxes over
public school taxes resulting from such election.
SECTION 3.03 - TENANT'S PROPORTIONATE SHARE OF OPERATING COSTS
The Tenant shall pay to the Landlord as Additional Rent in accordance
with Section 3.07 the Proportionate Share of Operating Costs.
SECTION 3.04 - MANAGEMENT FEE
The Tenant shall pay to the Landlord as Additional Rent in accordance
with Section 3.07 the Management Fee.
SECTION 3.05 - TENANT'S TAXES
The Tenant shall pay to the appropriate and lawful taxing authorities,
or to the Landlord, as appropriate, and shall discharge when the same become due
and payable, all Tenant's Taxes.
SECTION 3.06 - TENANT'S RESPONSIBILITY
The Tenant shall promptly deliver to the Landlord copies of assessment
notices, tax bills and other documents received by the Tenant relating to Taxes
and Tenant's Taxes and receipts for payment of Taxes and Tenant's Taxes. The
Tenant shall not contest any Taxes or Tenant's Taxes or appeal any assessments
relating thereto without the Landlord's prior written approval, NOT TO BE
UNREASONABLY WITHHELD. If the Tenant obtains such approval, the Tenant shall
deliver to the Landlord such security for the payment of such Taxes or Tenant's
Taxes as the Landlord REQUIRES, ACTING REASONABLY, and the Tenant shall
diligently prosecute any such appeal or contestation to a speedy resolution and
shall keep the Landlord informed of its progress in that regard from time to
time.
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SECTION 3.07 - PAYMENT OF ESTIMATED TAXES, OPERATING COSTS & MANAGEMENT FEE
(a) The amounts payable by the Tenant pursuant to Sections 3.02,
3.03, 3.04 and 3.05 hereof may be estimated by the Landlord
for such period as the Landlord determines from time to time,
NOT EXCEEDING 12 MONTHS and the Tenant agrees to pay to the
Landlord the amounts so estimated in monthly instalments in
advance during such period as Additional Rent. Notwithstanding
the foregoing, as soon as bills for all or any portion of the
said amounts so estimated are received, the Landlord may bill
the Tenant for the Proportionate Share thereof and the Tenant
shall pay the Landlord such amounts so billed (less all
amounts previously paid on account by the Tenant on the basis
of the Landlord's estimate as aforesaid) as Additional Rent on
demand.
(b) Within ONE HUNDRED AND EIGHTY (180) DAYS after the end of the
period for which such estimated payments have been made, the
Landlord shall deliver to the Tenant a statement, CONTAINING
REASONABLE DETAIL, AND, CERTIFIED BY A SENIOR FINANCIAL
OFFICER OF THE LANDLORD AS HAVING BEEN CALCULATED IN
ACCORDANCE WITH THE LEASE, from the Landlord of the Operating
Costs, Taxes and Management Fee together with a calculation of
the Tenant's share of the costs and expenses payable to the
Landlord pursuant to Sections 3.02, 3.03, 3.04 and 3.05 and,
if necessary, an adjustment shall be made between the parties
in the following manner. If the Tenant has paid in excess of
the amounts due, the excess shall be refunded by the Landlord
within THIRTY (30) DAYS after the delivery of the said
statement. If the amount the Tenant has paid is less than the
amounts due, the Tenant agrees to pay such additional amounts
due WITHIN THIRTY (30) DAYS AFTER demand. If any fiscal year
during the Term is greater or less than any such period
determined by the Landlord as aforesaid, the Tenant's share of
the costs and expenses payable to the Landlord, pursuant to
Sections 3.02, 3.03, 3.04 and 3.05 shall be subjected to a per
diem, pro rata adjustment based upon a period of three hundred
and sixty-five (365) days. The obligations set out herein
shall survive the expiration of the Term or earlier
termination of this Lease. Failure of the Landlord to render
any statement of Taxes, Operating Costs and Management Fee
shall not prejudice the Landlord's right to render such
statement thereafter or with respect to any other period. The
rendering of any such statement shall also not affect the
Landlord's right to subsequently render an amended or
corrected statement WITHIN TWELVE (12) MONTHS THEREAFTER.
(c) THE AMOUNT PAYABLE BY THE TENANT PURSUANT TO SECTIONS 3.02,
3.03 AND 3.04 HEREOF HAVE BEEN ESTIMATED BY THE LANDLORD,
WITHOUT PREJUDICE, TO BE FIVE DOLLARS AND FORTY CENTS ($5.40)
PER SQUARE FOOT OF RENTABLE AREA OF THE LEASED PREMISES FOR
THE FIRST PERIOD ENDING OCTOBER 31, 1999, CALCULATED AS
FOLLOWS:
TAXES: $3.95 PER SQUARE FOOT OF RENTABLE AREA OF
THE LEASED PREMISES
OPERATING COSTS: $1.00 PER SQUARE FOOT OF RENTABLE AREA OF
THE LEASED PREMISES
MANAGEMENT FEE: $0.45 PER SQUARE FOOT OF RENTABLE AREA OF
THE LEASED PREMISES
TOTAL: $5.40 PER SQUARE FOOT OF RENTABLE AREA OF
THE LEASED PREMISES
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ARTICLE IV
COMPLEX - CONTROL AND SERVICES
SECTION 4.01 - CONTROL OF THE COMPLEX BY THE LANDLORD
The Landlord shall operate and maintain the Complex in a reasonable
and reputable manner as would a prudent landlord of a similar FIRST CLASS
industrial building LOCATED IN MISSISSAUGA, ONTARIO, having regard to size,
age and location.
The Complex is at all times subject to the exclusive control,
management and operation of the Landlord. Without limiting the generality of
the preceding sentence, the Landlord has the right, in its control,
management and operation of the Complex and by the establishment of Rules and
Regulations and general policies with respect to the operation of the Complex
or any part thereof at all times during the period when the Tenant is given
possession of the Leased Premises and throughout the Term to:
(a) construct improvements in or to the Complex and make
alterations and additions thereto, subtractions therefrom,
rearrangements thereof (including parking areas and all
entrances and exits to the Complex), build additional storeys
on the Complex and construct additional facilities adjoining
or proximate to the Complex;
(b) relocate or re-arrange the various facilities and improvements
comprising the Complex or erected on the Lands from those
existing at the Commencement Date;
(c) do and perform such other acts in and to the Complex as in the
use of good business judgment the Landlord determines to be
advisable for the more efficient and proper operations of the
Complex.
Notwithstanding anything contained in this Lease, it is understood
and agreed that if as a result of the exercise by the Landlord of its right
set out in this Section 4.01, the facilities in or improvements to the
Complex are diminished or altered in any manner whatsoever, the Landlord is
not subject to any liability, nor is the Tenant entitled to any compensation,
nor shall any such diminution or alteration of the facilities or improvements
in or to the Complex be deemed constructive or actual eviction, or a breach
of any covenant for quiet enjoyment contained in this Lease or implied by law
provided that the Landlord shall not materially impede access to the Leased
Premises OR MATERIALLY ADVERSELY AFFECT THE TENANT'S USE AND ENJOYMENT OF THE
LEASED PREMISES during the completion of any such work and provided further
that the Landlord shall complete all such work diligently and with due speed.
SECTION 4.02 - SUBSTITUTION
At any time, the Landlord may substitute for the Leased Premises or
any portion thereof other premises in the Complex (the "New Premises"), in
which event the New Premises shall be deemed to be the Leased Premises or
such portion for all purposes hereunder, provided that the New Premises shall
be similar in area and utility for the Tenant's purposes. If the Tenant is
occupying the Leased Premises at the time of such substitution, the Landlord
shall pay the reasonable expense of moving the Tenant, its property and
equipment to the New Premises and shall, at its sole cost, improve the New
Premises (or the new portion, as the case may be) with Leasehold Improvements
substantially similar to those located in the Leased Premises.
NOTWITHSTANDING ANYTHING CONTAINED IN THIS SECTION 4.02, PROVIDED
THE TENANT IN OCCUPATION OF THE WHOLE OF THE LEASED PREMISES IS LOYALTY
MANAGEMENT GROUP CANADA INC., OR A PERMITTED TRANSFEREE PURSUANT TO SECTION
10.07A, THE LANDLORD SHALL HAVE NO RIGHT TO RELOCATE ALL OR PART OF THE
LEASED PREMISES DURING THE TERM OF THIS LEASE.
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ARTICLE V
UTILITIES AND ADDITIONAL SERVICES
SECTION 5.01 - CHARGES FOR UTILITIES
The Tenant shall be solely responsible for and shall promptly pay
for the cost of operating, repairing, maintaining, replacing and inspecting
the machinery and other facilities required for the heating, ventilating and
cooling of the Leased Premises and costs of electricity, water, steam, fuel,
power, telephone, sewer and other utilities applicable to the Leased Premises
on the basis of separate meters and otherwise on the basis of the Rentable
Area of the Leased Premises or estimated consumption within the Leased
Premises. The Landlord shall be entitled, acting equitably, to allocate to
the Leased Premises an Additional Service Cost (BUT WITHOUT MARK-UP BEYOND
THE COST THEREOF) for any Additional Service in respect of usage of ANY SUCH
UTILITY THAT IS NOT SEPARATELY METERED in the Leased Premises WHICH IS in
excess of AMOUNTS ALLOCATED ON THE BASIS OF AREA OR ESTIMATED CONSUMPTION.
The Tenant further covenants to heat the Leased Premises to a sufficient
temperature to prevent at all times, any damage to the Leased Premises and/or
building containing the Leased Premises and without limiting the generality
of the foregoing, to heat the Leased Premises so as to comply with any law,
order, requirement and/or regulations which from time to time govern the
heating thereof. Upon the request of the Landlord, the Tenant shall install
its own separate meter(s) for the Leased Premises at its own expense if so
requested by the Landlord.
SECTION 5.02 - ADDITIONAL SERVICES OF THE LANDLORD
Subject to Article 4 hereof, and excluding services supplied by the
Landlord and charged to the Tenant as Operating Costs, one hundred and
fifteen per cent (115 %) of the cost to the Landlord of all Additional
Services provided by the Landlord or its agent to the Tenant shall be payable
forthwith by the Tenant, upon demand by the Landlord, as an Additional
Service Cost. Such services shall include any services performed at the
Tenant's request including, without limitation, maintenance, repair,
janitorial or cleaning services, construction of additional Leasehold
Improvements and replacement of bulbs (including non-standard bulbs), tubes
and ballasts. Such services shall also include any services provided at the
Landlord's reasonable discretion including, without limitation, supervising
the movement of furniture, equipment, freight and supplies for the Tenant.
Additional Services provided by the Landlord or its agent on behalf of the
Tenant in respect of any of the Tenant's obligations set out in the Lease
which the Tenant fails to perform shall be ONE HUNDRED AND FIFTEEN PER CENT
(115%) of the cost to the Landlord.
SECTION 5.03 - THIRD PARTY SERVICES
Excluding services supplied by the Landlord and charged to the
Tenant as Operating Costs or as an Additional Service Cost, the Tenant shall
be solely responsible for, and promptly pay to the appropriate third party,
all charges for services used or consumed in or provided to the Leased
Premises, including, without limitation, rug shampooing, TELECOMMUNICATIONS
SERVICES, JANITORIAL SERVICES, pest control and other services not available
through the Landlord. In no event will the Landlord be liable to the Tenant
in damages or otherwise for any failure to supply any third-party services to
the Leased Premises.
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ARTICLE VI
USE OF LEASED PREMISES
SECTION 6.01 - USE OF THE LEASED PREMISES
The Leased Premises shall be used for the Type of Business of the
Tenant specified in Section 1.01(15), provided such purpose complies with all
applicable laws, by-laws, regulations or other governmental ordinances from
time to time in existence. The Leased Premises may not be used for any other
purposes. AS AT THE DATE OF EXECUTION OF THIS LEASE, THE LANDLORD REPRESENTS
THAT THE TYPE OF BUSINESS OF THE TENANT IS A PERMITTED USE UNDER EXISTING
MUNICIPAL LAND USE BY-LAWS THAT APPLY TO THE COMPLEX.
SECTION 6.02 - OBSERVANCE OF LAW
The Tenant shall at its sole cost and expense and, where applicable
in compliance with Sections 8.01 and 8.02 hereof promptly observe and comply
with all laws or requirements of all governmental authorities, including
federal, provincial and municipal legislative enactments, by-laws and other
regulations and all other authorities having jurisdiction, including fire
insurance underwriters, now or hereafter in force which pertain to or affect
the Leased Premises, the Tenant's use of the Leased Premises or the conduct
of any business in the Leased Premises, or the making of any repairs,
replacements, alterations, additions, changes, substitutions or improvements
of or to the Leased Premises. The Tenant shall carry out all modifications,
alterations or changes of or to the Leased Premises and the Tenant's conduct
of business in or use of the Leased Premises which are required by any such
authorities.
SECTION 6.03 - ENERGY CONSERVATION
Consistent with its obligations to keep the Leased Premises in good
repair, order and condition hereunder, the Tenant will at its cost comply
with all laws, by-laws, regulations and orders relating to the conservation
of energy affecting the Leased Premises and the conduct of business therein,
including compliance with all reasonable requests and demands of the Landlord
intended to achieve the conservation of energy.
SECTION 6.04 - ODOURS, DUST OR NOISE
The Tenant warrants that no noxious odours, dust or unreasonable
noise will emanate from the Leased Premises as a result of the operations
conducted by the Tenant therein and the Tenant further covenants that it will
not cause or maintain any nuisance in, at or on the Leased Premises and/or
the Lands. Accordingly, the Tenant agrees that should such noxious odours,
dust or noise conditions exist, the Tenant will, at its own expense, take
such steps as may be necessary to rectify the same, provided further that if
the Tenant shall fail to commence to do so within forty-eight (48) hours and
complete the same within a reasonable time after Notice is received by the
Tenant from the Landlord, then the Landlord may, at its option and without
prejudice to its other rights or recourses:
(i) notify Tenant by Notice that it must shut down all its
operations in the Leased Premises; and
(ii) the Landlord may proceed forthwith to take reasonable measures
to correct the situation and the Landlord shall be entitled to
cover the cost thereof from the Tenant forthwith upon demand
as an Additional Service Cost.
The LANDLORD AGREES TO USE REASONABLE EFFORTS TO OBTAIN SIMILAR
COVENANTS REGARDING ODOURS, DUST, NOISE AND NUISANCE FROM OTHER TENANTS OF
THE COMPLEX AND TO USE REASONABLE EFFORTS TO ENFORCE SUCH COVENANTS.
SECTION 6.05 - OBSTRUCTIONS
The sidewalks, entries, passage corridors and stairways shall not be
obstructed by the Tenant, its officers, agents, servants, employees or
customers or used for any other purposes than for ingress and egress to or
from the Leased Premises, and the Tenant shall save the Landlord harmless
from damages to persons or property because of any nuisance or other act
which shall obstruct the free movements of persons to, in and from the
building and Lands.
SECTION 6.06 - OUTSIDE AREAS
The Tenant shall not use any part of the exterior parking and
loading areas or any other areas outside the Leased Premises for any purpose
other than parking, shipping or receiving in the areas designated by the
Landlord from time to time for same. The Tenant shall not allow any type of
storage and/or transportation trailer belonging to or being used by or on
behalf of the Tenant to remain in such parking, shipping or receiving
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areas for any period of time longer than shall be necessary for the Tenant's
purposes and if any such vehicle has remained in any parking, shipping or
receiving areas for a period in excess of that required for the Tenant's
purposes, as determined by the Landlord acting reasonably, the Landlord shall
be entitled to have such trailer removed at the Tenant's sole cost as an
Additional Service. In addition, any damage caused to such parking, shipping
or receiving areas as a result of the presence of such trailer shall be
forthwith repaired by the Tenant, at the Tenant's sole cost or, at the
Landlord's option, shall be repaired by the Landlord and the costs thereof
shall be payable forthwith by the Tenant, upon demand by the Landlord, as an
Additional Service Cost.
SECTION 6.07 - ENVIRONMENTAL LAW
For the purposes of this Lease:
(a) "Environmental Law" means any law, by-law, order, ordinance,
ruling, regulation, certificate, approval, consent or
directive of any applicable federal, provincial or municipal
government, governmental department, agency or regulatory
authority or any court of competent jurisdiction, relating to
environmental matters and/or regulating the import, storage,
distribution, labelling, sale, use, handling, transport or
disposal of Hazardous Substances, including but not limited
to, the Environmental Protection Act (Ontario), as amended
from time to time;
(b) "Hazardous Substance" means any contaminant, pollutant,
dangerous substance, noxious substance, toxic substance,
hazardous waste, flammable or explosive material, radioactive
material, urea formaldehyde foam insulation, asbestos,
polychlorinated byphenyls, polychlorinated biphenyl waste,
polychlorinated biphenyl related waste, and any other
substance or material now or hereafter declared, defined or
deemed to be regulated or controlled in or pursuant to the
Environmental Law; and
(c) "Release" means any release, spill, emission, leakage,
pumping, injection, deposit, disposal, discharge, dispersal,
leaching or migration.
During the Term of this Lease:
(i) THE LANDLORD AND THE TENANT SHALL comply with all requirements
of the Environmental Law, and all other applicable laws,
by-laws, rules, regulations, orders, ordinances, whether
federal, provincial or municipal; and
(ii) THE TENANT SHALL conduct its business operation in the Leased
Premises in such a manner as to prevent the Release of any
Hazardous Substance in, on, under, over or at the Leased
Premises.
If the Tenant creates or brings to the Lands, Complex or the Leased
Premises any Hazardous Substances or if the conduct of the Tenant's business
shall cause there to be any Hazardous Substance at the Lands, the Complex or
the Leased Premises then, notwithstanding any rule of law to the contrary,
such Hazardous Substance shall be and remain the sole and exclusive property
of the Tenant and shall not become the property of the Landlord
notwithstanding the degree of affixation to the Leased Premises, Complex or
the Lands of the Hazardous Substance, and notwithstanding the expiry or
earlier termination of this Lease.
During the Term, and at the expiration of the Term of this Lease,
the Tenant shall, at the Tenant's sole cost and expense in accordance with
all requirements of the Environmental Law, remove any Hazardous Substance
CREATED OR BROUGHT TO THE LANDS, COMPLEX OR THE LEASED PREMISES BY THE TENANT.
IF THE LANDLORD CREATES OR BRINGS TO THE LANDS, COMPLEX OR THE
LEASED PREMISES ANY HAZARDOUS SUBSTANCE OR IF THE PERFORMANCE OF THE
LANDLORD'S OBLIGATIONS AS REQUIRED UNDER THIS LEASE SHALL CAUSE THERE TO BE
ANY HAZARDOUS SUBSTANCE AT THE LANDS, THE COMPLEX OR THE LEASED PREMISES
THEN, OR IF THERE IS ANY HAZARDOUS SUBSTANCE EXISTING IN, ON, UNDER, OVER OR
AT THE COMPLEX AS AT THE DATE HEREOF, IN EACH CASE SUCH HAZARDOUS SUBSTANCE
SHALL BE REMOVED AT THE EXPENSE OF THE LANDLORD IN ACCORDANCE WITH ALL
REQUIREMENTS OF ENVIRONMENTAL LAW.
THE LANDLORD WARRANTS THAT TO THE BEST OF ITS KNOWLEDGE AND BELIEF, THE
COMPLEX AND LEASED PREMISES CONTAINS NO HAZARDOUS SUBSTANCE AS AT THE
COMMENCEMENT DATE.
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ARTICLE VII
INSURANCE AND INDEMNITY
SECTION 7.01 - TENANT'S INSURANCE
(a) The Tenant shall throughout the period that the Tenant is
given possession of the Leased Premises and during the entire
Term, at its sole cost and expense, take out and keep in full
force and effect, the following insurance:
(i) all-risk property insurance (including but not
limited to sprinkler leakage, flood, earthquake and
collapse coverage) in an amount equal to the full
replacement cost thereof upon property of every
description and kind owned by the Tenant or for which
the Tenant is liable, or installed by or on behalf of
the Tenant and which is located within the Complex
including, without limitation, Leasehold
Improvements, tenant's fixtures, the Tenant's
stock-in-trade, furniture and personal property
provided that if there is a dispute as to the amount
which comprises full replacement cost, the decision
of the TENANT'S INSURER shall be conclusive;
(ii) business interruption insurance in such amount as
will reimburse the Tenant for direct or indirect loss
of earnings attributable to all perils insured
against in Section 7.01(a)(i) and other perils
commonly insured against by prudent tenants or
attributable to prevention of access to the Leased
Premises or the Complex as a result of such perils.
PROVIDED HOWEVER, THAT SO LONG AS THE TENANT IS
LOYALTY MANAGEMENT GROUP CANADA INC. OR A PERMITTED
TRANSFEREE PURSUANT TO SECTION 10.07A AND IS IN
OCCUPATION OF THE WHOLE OF THE LEASED PREMISES, THE
LANDLORD HEREBY AGREES THAT THE TENANT SHALL BE
PERMITTED AT ITS OPTION, TO SELF-INSURE WITH RESPECT
TO THE COVERAGE FOR THE INTERRUPTION OF ITS BUSINESS
REFERRED TO IN THIS SECTION 7.01(a)(ii), BUT IN THE
EVENT THAT IT DOES SO, THE TENANT SHALL BE DEEMED FOR
ALL PURPOSES UNDER THIS LEASE TO HAVE PLACED SUCH
INSURANCE AND BE MAINTAINING THE SAME;
(iii) comprehensive general and legal liability insurance,
including bodily injury, property damage and personal
injury liability, tenant's legal liability,
contractual liability and owners' and contractors'
protective insurance coverage with respect to the
Leased Premises and the Tenant's use of the Complex,
coverage to include the activities and operations
conducted by the Tenant and any other person for whom
the Tenant is in law responsible. Such policies shall
be written on a comprehensive basis with inclusive
limits of not less than FIVE MILLION DOLLARS
($5,000,000) for bodily injury to any one or more
persons or property damage, and such higher limits as
the Landlord OR THE MORTGAGEE, acting reasonably,
requires from time to time, and shall contain a
severability of interests clause and a
cross-liability clause;
(iv) if appropriate, broad form comprehensive boiler and
machinery insurance on a blanket repair and
replacement basis with limits for each accident in an
amount not less than the full replacement cost of all
Leasehold Improvements and of all boilers, pressure
vessels, 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 in or serving the Leased Premises;
(v) insurance required by reason of the introduction by
or on behalf of the Tenant or any occupant of the
Leased Premises, or any part thereof, of any
radioactive material or substance, into or on or
about the Leased Premises or on the Lands, or for any
other reason requiring special coverage; and
(vi) any other form of insurance which the Landlord,
acting reasonably, requires from time to time in
form, in amounts and for risks against which a
prudent tenant would insure.
(b) All policies shall:
(i) be taken out with insurers acceptable to the
Landlord, ACTING REASONABLY;
(ii) be in a form satisfactory from time to time to the
Landlord which form may include a reasonable
deductible, the amount of THAT A PRUDENT TENANT WOULD
ARRANGE;
(iii) be non-contributing with and shall apply only as
primary and not as excess to any other insurance
available to the Landlord or the Mortgagee;
(iv) 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 or
conditions contained in the policies;
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(v) contain an undertaking by the insurers to notify the
Landlord and the Mortgagee in writing not less than
thirty (30) days prior to any material change,
cancellation or termination thereof; and
(vi) name the Landlord and the Mortgagee as insured
parties, AS THEIR RESPECTIVE INTERESTS APPEAR and, in
respect of property damage insurance, incorporate the
Mortgagee's standard mortgage clause.
(c) Certificates of insurance on the Landlord's standard form or
if required by the Landlord or the Mortgagee certified copies
of each such insurance policy will be delivered to the
Landlord as soon as practicable after the placing of the
required insurance and in any event at least ten (10) days
prior to the effective date of coverage. Provided that no
review or approval of any such insurance certificate by the
Landlord shall derogate from or diminish the Landlord's rights
or the Tenant's obligations contained in this Article.
(d) If the Tenant fails to take out or keep in force any insurance
referred to in this Section 7.01, or should any such insurance
not be approved by either the Landlord or the Mortgagee and
should the Tenant not commence to diligently rectify (and
thereafter proceed to diligently rectify) the situation within
twenty-four (24) hours after written notice by the Landlord to
the Tenant (stating, if the Landlord or the Mortgagee does not
approve of such insurance, the reasons therefor), the Landlord
has the right without assuming any obligation in connection
therewith to effect such insurance at the sole cost of the
Tenant and all outlays by the Landlord shall be paid by the
Tenant to the Landlord on demand as Additional Rent without
prejudice to any other rights and remedies of the Landlord
under this Lease.
(e) The Tenant agrees that in the event of damage or destruction
to the Leasehold Improvements in the Leased Premises covered
by insurance pursuant to Section 7.01(a)(i), the Tenant shall
use the proceeds of such insurance for the purpose of
repairing or restoring such Leasehold Improvements. In the
event of damage to or destruction of the Complex entitling the
Landlord to terminate the Lease pursuant to Section 9.01(b) or
9.02, then if the Leased Premises have also been damaged or
destroyed and the Lease is terminated, the Tenant shall
forthwith pay to the Landlord all of its insurance proceeds
relating to the Leasehold Improvements in the Leased Premises
and if the Leased Premises have not been damaged or destroyed,
the Tenant shall upon demand deliver to the Landlord in
accordance with the provisions of this Lease the Leasehold
Improvements and the Leased Premises.
SECTION 7.02 - INCREASE IN INSURANCE PREMIUMS
The Tenant shall not keep, use, sell or offer to sell in or upon the
Leased Premises any article which may be prohibited by any fire insurance policy
in force from time to time covering the Leased Premises or the Complex. If:
(a) the occupation of the Leased Premises;
(b) the conduct of business in the Leased Premises; or
(c) any act or omission of the Tenant in the Complex or any part
thereof;
causes or results in any increase in premiums for the insurance carried from
time to time by the Landlord with respect to the Complex, the Tenant shall
pay any such increase in premiums as Additional Rent forthwith upon demand by
the Landlord. In determining whether increased premiums are caused by or
result from the use or occupancy of the Leased Premises, a schedule issued by
the organization computing the insurance rate on the Complex showing the
various components of such rate shall be conclusive evidence of the several
items and charges which make up such rate. The Tenant shall comply promptly
with all requirements of any insurer now or hereafter in effect pertaining to
or affecting the Leased Premises or the Complex.
SECTION 7.03 - CANCELLATION OF INSURANCE
If any insurance policy upon the Complex or any part thereof shall be
cancelled or shall be threatened by the insurer to be cancelled or the coverage
thereunder reduced in any way by the insurer by reason of the use or occupation
of the Leased Premises or any part thereof by the Tenant or by any assigns or
sub-tenant of the Tenant, or by anyone permitted by the Tenant to be upon the
Leased Premises, the Tenant shall remedy the condition giving rise to
cancellation, threatened cancellation or reduction of coverage within
twenty-four (24) hours after Notice thereof by the Landlord.
SECTION 7.04 - 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 Complex, or damage to
property of the Tenant or of others located on the Leased
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Premises or elsewhere in the Complex, nor shall it be responsible for any
loss of or damage to any property of the Tenant or others from any cause
whatsoever, except for any such death, injury, loss or damage which results
from the negligence of the Landlord, its agents, servants or employees or
other persons for whom it may in law be responsible and provided that in no
event shall the Landlord be responsible for any loss, injury or damage
contemplated by Section 7.07(b), or for any indirect or consequential damages
sustained by the Tenant or others. Without limiting the generality of the
foregoing but subject to the exceptions to the limitation of the liability of
the Landlord set out herein, the Landlord shall not be liable for any injury
or damage to persons or property resulting from fire, explosion, dampness,
falling plaster, falling ceiling tile, failing ceiling fixtures (including
part or all of the ceiling T grid system) and diffuser coverings, or from
steam, gas, electricity, water, rain, flood, snow or leaks from any rentable
premises or from the pipes, sprinklers, appliances, plumbing works, roof,
windows or subsurface of any floor or ceiling of the Complex or from the
street or any other place or by any other cause whatsoever. The Landlord
shall not be liable for any such damage caused by other tenants or persons in
the Complex or by occupants of adjacent property thereto, or the public, or
caused by construction or by any private, public or quasi-public work. All
property of the Tenant kept or stored on the Leased Premises shall be so kept
or stored at the risk of the Tenant only and the Tenant shall indemnify the
Landlord and save it harmless from any claims arising out of any damage to
the same including, without limitation, any subrogation claims by the
Tenant's insurers.
SECTION 7.05 - LANDLORD'S INSURANCE
The Landlord shall at all times throughout the Term carry:
(a) insurance on the Complex (excluding the foundations and
excavations) and the machinery, boilers and equipment
contained therein or servicing the Complex and owned by the
Landlord or the owners of the Complex (specifically excluding
any property with respect to which the Tenant and other
tenants are obliged to insure pursuant to Section 7.01 or
similar sections of their respective leases) against damage by
fire and extended perils or all-risks coverage IN AN AMOUNT
EQUAL TO THE FULL REPLACEMENT COST OF THE SUBJECT MATTER
THEREOF;
(b) public liability and property damage insurance with respect to
the Landlord's operations in the Complex;
(c) loss of rental income insurance, or loss of insurable gross
profits commonly insured against by prudent landlords FOR A
PERIOD OF NOT LESS THAN TWELVE (12) MONTHS, including loss of
all rentals receivable from tenants in the Complex in
accordance with the provisions of their leases, including
basic and additional rentals; and
(d) such other form or forms of insurance as the Landlord or the
Mortgagee reasonably considers advisable.
Such insurance shall be in such reasonable amounts and with such
reasonable deductibles as would be carried by a prudent owner of a reasonably
similar industrial building, having regard to size, age and location WITH A
FINANCIALLY SOLVENT INSURER. Notwithstanding the Landlord's covenant
contained in this Section 7.05, and notwithstanding any contribution by the
Tenant to the cost of insurance premiums provided herein, the Tenant
acknowledges and agrees that 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
carried by the Landlord.
SECTION 7.06A - INDEMNIFICATION OF THE LANDLORD
Except as provided in Section 7.07(a) but notwithstanding any other
provision of this Lease, the Tenant agrees to protect, indemnify and save
each of the Landlord and its officers, employees and agents completely
harmless from and against:
(i) any loss (including loss of Basic Rent and Additional Rent),
claims, actions, damages, liability and expenses in connection
with loss of life, personal injury, damage to property or any
other loss or injury whatsoever arising out of this Lease, or
any occurrence in, upon or at the Leased Premises, or the
occupancy or use by the Tenant of the Leased 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
Leased Premises by the Tenant; and
(ii) any Environmental Claim, directly or indirectly incurred,
sustained or suffered by or asserted against the Landlord
and/or its officers, employees and agents caused by or
attributable to, either directly or indirectly, any act or
omission of the Tenant and/or any other person for which the
Tenant is in law responsible prior to or during the Term of
this Lease.
For the purposes of this Lease, "Environmental Claim" means any claims,
losses, costs, expenses, fines, penalties, payments and/or damages (including
without limitation, all reasonable solicitors' fees on a solicitor and his own
client basis) relating to, arising out of, resulting from or in any way
connected with the Release (as such term is defined in Section 6.07 of this
Lease) in, on, over, upon or from the Leased Premises of
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any Hazardous Substance (as such term is defined in Section 6.07 of this
Lease) including, without limitation, all costs and expenses of any
remediation or restoration of the Leased Premises and/or the Lands required
or mandated by the Environmental Law (as such term is defined in Section 6.07
of this Lease).
If the Landlord shall, without fault on its part, be made a party of
any litigation commenced by or against the Tenant, then the Tenant shall
protect, indemnify and hold the Landlord harmless and shall pay all costs,
expenses and reasonable legal fees incurred or paid by the Landlord in
connection with such litigation. The Tenant shall also pay all costs,
expenses and legal fees that may be incurred or paid by the Landlord in
reasonably enforcing the terms, covenants and conditions in this Lease unless
a court of law having jurisdiction shall decide otherwise.
SECTION 7.06B - INDEMNIFICATION OF THE TENANT
NOTWITHSTANDING ANY OTHER TERMS, COVENANTS AND CONDITIONS CONTAINED
IN THIS LEASE EXCEPT SECTION 7.07(b), THE LANDLORD SHALL INDEMNIFY THE TENANT
AND SAVE IT HARMLESS FROM AND AGAINST ANY AND ALL LOSS, CLAIMS, ACTIONS,
DAMAGES, LIABILITIES AND EXPENSES 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 COMPLEX
(EXCLUDING THE LEASED PREMISES SUBJECT TO SECTION 7.04) OCCASIONED WHOLLY OR
IN PART BY ANY ACT OR OMISSION OF THE LANDLORD OR BY ANYONE FOR WHOM THE
LANDLORD IS IN LAW RESPONSIBLE. IF THE TENANT SHALL, WITHOUT FAULT ON ITS
PART, BE MADE A PARTY TO ANY LITIGATION COMMENCED BY OR AGAINST THE LANDLORD,
THEN THE LANDLORD SHALL PROTECT, INDEMNIFY AND HOLD THE TENANT HARMLESS AND
SHALL PAY ALL COSTS, EXPENSES AND REASONABLE LEGAL FEES INCURRED OR PAID BY
THE TENANT IN CONNECTION WITH SUCH LITIGATION. THE LANDLORD SHALL ALSO PAY
ALL REASONABLE COSTS, EXPENSES AND LEGAL FEES (ON A SOLICITOR AND HIS CLIENT
BASIS) THAT MAY BE INCURRED OR PAID BY THE TENANT IN REASONABLY ENFORCING THE
TERMS, COVENANTS AND CONDITIONS IN THIS LEASE.
SECTION 7.07 - LIMITATIONS OF LIABILITY
(a) The Tenant shall not be liable to the Landlord in respect of
any loss, injury or damage insured by the Landlord under
Sections 7.05(a) and (c); and
(b) The Landlord shall not be liable to the Tenant in respect of
any loss, injury or damage to property insured or required to
be insured by the Tenant under Sections 7.01(a)(i), (ii) and
(iv).
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ARTICLE VIII
MAINTENANCE, REPAIRS AND ALTERATIONS
SECTION 8.01 - MAINTENANCE AND REPAIRS BY THE TENANT
(a) Subject to Sections 9.01 and 9.02, the Tenant shall at all
times at its sole cost, keep and maintain the Leased Premises
and every part thereof, including all facilities, equipment
and services, in a clean and tidy condition and will not
permit waste paper, garbage, ashes, waste, debris or other
objectionable material to accumulate thereon or therein and
the Tenant will not use any outside garbage or other
containers (other than those approved or designated by the
Landlord) and the Tenant shall arrange for removal and
disposal of waste and garbage at its sole expense. The Tenant,
at its sole cost and expense, shall renew, rebuild, replace,
operate, maintain, paint and keep the Leased Premises and
every part thereof, INCLUDING BUT NOT LIMITED TO all
equipment, fixtures, appurtenances used in or about the Leased
Premises, including plumbing, electrical, heating, cooling,
and other facilities and systems during the Term of this
Lease, in good repair and first class condition, as a careful
and prudent owner would do. Subject to Section 8.03 and in
accordance with Section 8.02, the Tenant shall promptly make
all necessary repairs, structural and non-structural, capital
and non-capital, ordinary and extraordinary, foreseen as well
as unforeseen (excluding only such reasonable wear and tear as
would not be repaired by a careful and prudent owner and
except for repairs to the roof and bearing walls of the Leased
Premises except if caused by the negligent act or negligence
of the Tenant or those for whom the Tenant is in law
responsible).
(b) The Tenant shall examine the Leased Premises before taking
possession thereof and unless the Tenant furnishes the
Landlord with a notice in writing specifying any defect in the
construction of the Leased Premises within THIRTY (30) days
after such taking of possession, the Tenant shall conclusively
be deemed to have examined the Leased Premises, to have agreed
that they are in order, and such taking of possession without
the giving of such notice as aforesaid within such THIRTY (30)
day period is conclusive evidence against the Tenant that at
the time thereof the Leased Premises were in good order and
satisfactory condition, subject to latent defects, if any. The
Tenant agrees that there is no promise, representation or
undertaking by or binding upon the Landlord with respect to
the use of the Leased Premises or any alteration, remodelling
or redecorating of or installation of equipment or fixtures in
the Leased Premises, except such, if any, as are expressly set
forth in this Lease or the Agreement to Lease.
(c) The Tenant acknowledges that it will not enter, nor permit or
suffer any person to enter upon the roof of the building
containing the Leased Premises or make any opening in the roof
without the prior written consent of the Landlord.
(d) The Tenant covenants and agrees that it shall, at its sole
cost and expense, at all times during the Term of the Lease,
obtain and maintain an inspection and maintenance service
contract or contracts in relation to the mechanical systems in
the Leased Premises including, without limitation, the
heating, ventilation and cooling systems, as a prudent owner
would obtain and maintain. Copies of such inspection and
maintenance service contract or contracts will be delivered to
the Landlord as soon as practicable after the obtaining of the
required contract or contracts.
(e) The Tenant covenants and agrees that it shall not allow,
without the prior written consent of the Landlord, first had
and obtained, in the Landlord's sole discretion, any
protrusions from the Leased Premises for any reason
whatsoever, such control to the Landlord to protect the
aesthetics thereof and for the benefit of its own interest and
the interest of other tenants of the Lands and other persons
in or about the Lands. Should, however, such protrusion exist,
the Tenant shall indemnify the Landlord against any loss or
damage caused to any person, firm, corporation or thing as a
result of the same and the Tenant covenants and agrees that it
shall, at the request of the Landlord, remove the same or if
not removed within ten (10) days of request, then the Landlord
shall have the right to remove same and all costs and expenses
incurred shall be immediately payable by the Tenant to the
Landlord as an Additional Service Cost.
(f) In addition to the specific obligations elsewhere in this
Lease reserved and contained on the part of the Tenant to be
observed and performed and without in any way limiting the
generality thereof, the condition, maintenance, operation and
management of the Leased Premises, and other improvements
thereon or therein from time to time, including without
limitation all machinery, equipment and other facilities
therein or thereon, shall be the sole responsibility of the
Tenant, throughout the Term hereof and the Tenant shall make
all payments, foreseen, unforeseen, ordinary and/or
extraordinary, required to be made not only with respect to
the observance and performance of such specific obligations
but also with respect to the general obligation in this clause
contained.
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SECTION 8.02 - LANDLORD'S APPROVAL OF THE TENANT'S REPAIRS
(a) During the Term of this Lease or any renewal or extension
hereof, the Tenant shall not make any repairs, replacements,
Leasehold Improvements or install trade fixtures in any part
of the Leased Premises without first obtaining the Landlord's
written approval, such approval not to be unreasonably
withheld, and in connection therewith the Tenant shall, prior
to commencing any such work, submit to the Landlord:
(i) for its prior approval (NOT TO BE UNREASONABLY
WITHHELD OR DELAYED) details of the proposed work,
including drawings and specifications prepared by
qualified architects or engineers and conforming to
good engineering practice;
(ii) such indemnification against liens, costs, damages
and expenses (including its OUT-OF POCKET costs and
expenses REASONABLY incurred, or which may be
incurred, in reviewing the proposed work and
supervising its completion) and such insurance
coverages as the Landlord REASONABLY requires; and
(iii) evidence satisfactory to the Landlord that the Tenant
has obtained at its expense all necessary consents,
permits, licences and inspections from all
governmental and regulatory authorities having
jurisdiction.
(b) All such repairs, replacements, Leasehold Improvements or
trade fixtures made or installed by the Tenant in the Leased
Premises and approved by the Landlord shall be performed:
(i) with first class materials owned by the Tenant at the
sole cost of the Tenant;
(ii) by competent workmen whose labour union affiliations
are compatible with others employed by the Landlord
and its contractors;
(iii) in a good and workmanlike manner;
(iv) in accordance with the drawings and specifications
approved by the Landlord; and
(v) subject to the reasonable regulations, supervision,
controls and inspection of the Landlord.
(c) If any such repairs, replacements, Leasehold Improvements or
trade fixtures would affect the structure of the Complex, or
any of the electrical, mechanical or other base building
systems or their warranties, such work shall, at the option of
the Landlord, be performed by the Landlord as an Additional
Service. If such would affect such warranties, the LANDLORD
may reasonably refuse to allow such work to be done. Upon
completion thereof, and thereafter, to the extent requiring
ongoing maintenance, repair or replacement, the Tenant shall
pay to the Landlord the Additional Service Cost in respect
thereof. THE COST OF WORK PERFORMED FOR THE TENANT BY OR ON
BEHALF OF THE LANDLORD IN THIS SUB-SECTION (c) SHALL BE
COMPETITIVE WITH COSTS CHARGED FOR SIMILAR OR COMPARABLE WORK
CARRIED OUT BY COMPARABLE BUILDINGS IN THE CITY OF
MISSISSAUGA.
(d) In respect of repairs, alterations or replacements of or to
the Leased Premises thereafter during the Term, the Tenant
shall pay to the Landlord, as Additional Rent, THE
OUT-OF-POCKET ARCHITECTS' AND ENGINEERS' FEES AND COSTS AND
ALL OTHER OUT-OF-POCKET FEES AND COSTS INCURRED BY THE
LANDLORD WITH RESPECT TO SUCH REPAIRS, ALTERATIONS OR
REPLACEMENT OF OR TO THE LEASED PREMISES. In addition, any
cost or expense of the Landlord in providing garbage removal
to the Complex and, if the Landlord's architects and engineers
responsible for the Complex are not retained by the Tenant to
complete any improvements in the Leased Premises affecting the
structure of the Complex or any of the electrical, mechanical
or other base building systems or their warranties, any cost
or expense of the Landlord's architects and engineers in
respect of approval of plans, and supervision and/or
inspection of such work, will each be payable by the Tenant as
Additional Rent upon being invoiced by the Landlord.
SECTION 8.03 - MAINTENANCE AND REPAIRS BY THE LANDLORD
(a) The Landlord agrees with the Tenant to MAINTAIN AND keep in a
good and reasonable state of repair, and consistent with the
general standards of FIRST CLASS industrial buildings of
comparable age in the immediate area of the Complex, but
subject to Sections 9.01 and 9.02, and with the exception of
reasonable wear and tear:
(i) those portions of the Complex consisting of the
courts, concourses, lobbies, landscaped areas,
entrances, PARKING AREAS and other facilities from
time to time provided for common use and enjoyment,
and the exterior portions of all buildings and
structures from time to time forming part of the
Complex and affecting its general appearance;
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(ii) those portions of the Complex (other than the Leased
Premises and premises of other tenants) comprising
the Common Use Equipment, the entrances, stairways,
corridors and lobbies; and
(iii) the structural members or elements of the Leased
Premises, including its foundations, roof and
structural portions of exterior walls, except for
repairs caused by the negligent act or negligence of
the Tenant or those for whom the Tenant is in law
responsible.
(b) Subject to Sections 9.01 and 9.02, the Landlord agrees with
the Tenant to repair Insured Damage.
(c) The Tenant acknowledges and agrees that the Landlord is not
liable for any damages, direct, indirect or consequential, or
for damages for personal discomfort, illness or inconvenience
of the Tenant or the Tenant's servants, clerks, employees,
invitees or other persons by reason of failure of any
equipment, facilities or systems servicing the Complex or of
reasonable delays in the performance of any repairs,
replacements and maintenance for which the Landlord is
responsible pursuant to this Lease and no such delay shall
entitle the Tenant to any compensation or abatement whatsoever
SO LONG AS THE LANDLORD MAKES ALL NECESSARY REPAIRS AND
REPLACEMENTS DILIGENTLY AFTER BECOMING AWARE OF THE NEED FOR
SAME.
(d) If the Tenant refuses or neglects to carry out any repairs
properly required to be carried out by it under this Lease
and to the reasonable satisfaction of the Landlord, the
Landlord may, but shall not be obliged to, make such repairs
without being liable for any loss or damage that may result to
the Tenant's merchandise, fixtures or other property or to the
Tenant's business by reason thereof and upon completion
thereof, the Tenant shall pay to the Landlord the Additional
Service Cost in respect thereof.
SECTION 8.04 - SURRENDER OF THE LEASED PREMISES
At the expiration of the Term or earlier termination of this Lease, the
Tenant shall peaceably surrender and yield up the Leased Premises to the
Landlord in as good condition and repair as the Tenant is required to maintain
the Leased Premises throughout the Term, REASONABLE WEAR AND TEAR EXCEPTED and
the Tenant shall surrender all keys for the Leased Premises to the Landlord at
the place then fixed for the payment of rent and shall inform the Landlord of
all combinations of locks, safes and vaults, if any, in the Leased Premises. The
Tenant shall, however, remove all of its trade fixtures if requested by the
Landlord as provided in Section 8.08 hereof before surrendering the Leased
Premises as aforesaid. The Tenant's obligation under this covenant shall survive
the expiration of the Term or earlier termination of this Lease.
SECTION 8.05 - REPAIR WHERE THE TENANT IS AT FAULT
Save for the limitation of liability contained in Section 7.07(a) but
notwithstanding any other provision of this Lease, if the Complex or any part
thereof, or any equipment, machinery, facilities or improvements contained
therein or made thereto, or the roof or outside walls of the Complex or any
other structural portions thereof require repair or replacement or become
damaged or destroyed by reason of any act, omission to act, neglect or default
of the Tenant or those for whom the Tenant is in law responsible or through any
of them in any way stopping up or damaging the climate control, heating
apparatus, water pipes, drainage pipes or other equipment or facilities or parts
of the Complex, the cost of the resulting repairs, replacements or alterations
shall be an Additional Service Cost to the Tenant.
SECTION 8.06 - TENANT NOT TO OVERLOAD FACILITIES
The Tenant shall not install any equipment which will alter, exceed or
overload the capacity of any utility, electrical or mechanical facilities in the
Leased Premises, and the Tenant will not bring into the Leased Premises or
install any utility, electrical or mechanical facility or service which the
Landlord does not approve. The Tenant agrees that if any changes proposed or
used by the Tenant requires additional utility, electrical or mechanical
facilities, the Landlord may, in its sole discretion, if they are available,
elect to install them in accordance with plans and specifications to be approved
in advance in writing by the Landlord and the cost thereof shall be an
Additional Service Cost to the Tenant.
SECTION 8.07 - TENANT NOT TO OVERLOAD FLOORS
The Tenant shall not bring upon the Complex or the Leased Premises or
any part thereof any machinery, equipment, article or thing that by reason of
its weight, size or use might in the opinion of the Landlord damage the Complex
or the Leased Premises and shall not at any time overload the floors of the
Leased Premises.
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SECTION 8.08 - REMOVAL AND RESTORATION BY TENANT
(a) All Leasehold Improvements shall immediately become the
property of the Landlord upon affixation or installation
without compensation therefor to the Tenant, but the Landlord
is under no obligation to repair, maintain or insure any
Leasehold Improvements. Leasehold Improvements and trade
fixtures shall not be removed from the Leased Premises either
during or at the expiration or earlier termination of the Term
except that:
(i) the Tenant may during the Term in the usual or normal
course of its business and without the prior written
consent of the Landlord remove its trade fixtures,
and provided that the Tenant is not THEN in default
under this Lease; and
(ii) the Tenant shall, immediately prior to the expiration
of the Term and at its own cost, remove all trade
fixtures and repair any damage to the Leased Premises
caused by their installation and removal, failing
which such may be completed by the Landlord as an
Additional Service to the Tenant. THE TENANT SHALL
NOT BE RESPONSIBLE FOR RESTORATION OF THE LEASED
PREMISES OR REMOVAL OF ITS LEASEHOLD IMPROVEMENTS IN
THE LEASED PREMISES AT THE EXPIRY OR EARLIER
TERMINATION OF THIS LEASE OR ANY EXTENSIONS; HOWEVER,
THIS DOES NOT ABSOLVE THE TENANT FROM ITS
RESPONSIBILITY TO REPAIR DAMAGE AND MAINTAIN THE
LEASED PREMISES IN GOOD REPAIR, SUBJECT TO REASONABLE
WEAR AND TEAR, AS REQUIRED BY THE TERMS OF THIS
LEASE.
(b) If the Tenant does not remove its trade fixtures at the
expiration or earlier termination of the Term, the trade
fixtures shall, at the option of the Landlord, become the
property of the Landlord and, as an Additional Service to the
Tenant, may be removed from the Leased Premises and sold or
disposed of by the Landlord in such manner as it deems
advisable.
All property of the Tenant remaining on the Leased Premises THIRTY (30) DAYS
after the termination of the tenancy shall be deemed to have been abandoned by
the Tenant in favour of the Landlord and may be disposed of by the Landlord at
its discretion without prejudice to the rights of the Landlord to claim damages
from the Tenant for failure to remove the same.
SECTION 8.09 - NOTICE BY THE TENANT
The Tenant shall when it becomes aware of same notify the Landlord by
Notice of any damage to or deficiency or defect in any part of the Complex,
including the Leased Premises, any equipment or utility systems or any
installations located therein notwithstanding the fact that the Landlord may
have no obligations with respect to same.
SECTION 8.10 - TENANT TO DISCHARGE ALL LIENS
The Tenant shall at all times during the period that the Tenant is
engaged in the construction or installation of its improvements or has been
given possession of the Leased Premises and throughout the Term promptly pay all
its architects, engineers, contractors, materialmen, suppliers and workmen and
all charges incurred by or on behalf of the Tenant for any work, materials or
services which may be done, supplied or performed at any time in respect of the
Leased Premises and the Tenant shall do any and all things necessary so as to
ensure that no lien is registered against the Complex or any part thereof or
against the Landlord's interest in the Leased Premises and if any lien is made,
filed or registered, the Tenant shall discharge OR VACATE it or cause it to be
discharged forthwith at the Tenant's expense.
If the Tenant fails to discharge or cause any such lien to be
discharged as aforesaid, then in addition to any other right or remedy of the
Landlord, the Landlord may but it shall not be obligated to discharge OR VACATE
the same by paying the amount claimed to be due into Court and the amount so
paid by the Landlord and all costs and expenses, including reasonable legal fees
(on a solicitor and his client basis) incurred as a result of the registration
of any such lien shall be immediately due and payable by the Tenant to the
Landlord as Additional Rent on demand.
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SECTION 8.11 - SIGNS AND ADVERTISING
THE LANDLORD SHALL PERMIT THE TENANT TO INSTALL PROMINENT FASCIA
SIGNAGE ON THE NORTH AND SOUTH SIDES OF THE COMPLEX (AT THE TENANT'S SOLE
EXPENSE) AND SHALL WORK WITH THE TENANT TO ASSIST THE TENANT IN OBTAINING ANY
AND ALL REQUIRED PERMITS FOR SUCH SIGNAGE. THE DESIGN OF THE TENANT'S SIGNAGE
SHALL BE IN ACCORDANCE WITH THE LANDLORD'S SIGN CRITERIA FOR THE COMPLEX AND THE
TENANT'S SPECIFICATIONS AND THE PRECISE LOCATION SHALL BE SUBJECT TO THE
LANDLORD'S APPROVAL, NOT TO BE UNREASONABLY WITHHELD OR DELAYED. ALL SIGNAGE
SHALL BE SUBJECT TO THE APPROVAL OF THE CITY OF MISSISSAUGA. Other than such
identification signs, the Tenant shall not paint, affix or display any sign,
picture, advertisement, notice, lettering or decoration on any part of the
Complex or the Leased Premises for exterior view without the prior written
consent of the Landlord which consent may be unreasonably withheld. Any such
signs shall remain the property of the Tenant and shall be maintained at the
Tenant's sole cost and expense. At the expiration of the Term or earlier
termination of this Lease, the Tenant shall remove any such sign, picture,
advertisement, notice, lettering or decoration from the Leased Premises at the
Tenant's expense and shall promptly repair all damage caused by any such
installation and removal failing which such may be performed by the Landlord as
an Additional Service to the Tenant. The Tenant's obligation to observe and
perform this covenant shall survive the expiration of the Term or earlier
termination of this Lease. In the event that the Landlord provides and installs
a pylon board for the Complex, the Tenant shall be entitled at its expense as an
Additional Service to have its name shown upon such pylon board. The Landlord
shall design the style of such pylon board and shall in its own discretion
determine the location of the same.
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ARTICLE IX
DAMAGE AND DESTRUCTION
SECTION 9.01 - DESTRUCTION OF THE LEASED PREMISES
(a) If the Leased Premises are at any time destroyed or damaged
(including, without limitation, smoke and water damage) as a
result of fire, the elements, accident or other casualty
required to be insured against by the Landlord pursuant to
Section 7.05 hereof or otherwise insured against by the
Landlord, and if as a result of such occurrence:
(i) the Leased Premises are rendered untenantable only in
part, this Lease shall continue in full force and
effect and the Landlord shall, subject to Sections
9.01(b) and 9.02(a) hereof, commence diligently to
reconstruct, rebuild or repair the Leased Premises to
the extent only of its obligations under Section
8.03, and if the damage is such that the portion of
the Leased Premises rendered untenantable is not
reasonably capable of use and occupancy by the Tenant
for the purposes of its business, Rent shall abate
proportionately to the portion of the Leased Premises
rendered untenantable from and after THE DATE OF THE
DAMAGE AND DESTRUCTION and until the Landlord's
repairs have been completed;
(ii) the Leased Premises are rendered wholly untenantable,
this Lease shall continue in full force and effect
and the Landlord shall, subject to Sections 9.01(b)
and 9.02(a) hereof, commence diligently to
reconstruct, rebuild or repair the Leased Premises to
the extent only of its obligations under Section 8.03
and Rent shall abate entirely from and after THE DATE
OF SUCH DAMAGE AND DESTRUCTION and until the
Landlord's repairs have been completed;
(iii) the Leased Premises are not rendered untenantable in
whole or in part, this Lease shall continue in full
force and effect, the Rent and other amounts payable
by the Tenant shall not terminate, be reduced or
abate and the Landlord shall, subject to Sections
9.01(b) and 9.02(a) hereof, commence diligently to
reconstruct, rebuild or repair the Leased Premises to
the extent only of its obligations under Section
8.03.
(b) Notwithstanding anything contained in Section 9.01(a), if the
Leased Premises are damaged or destroyed by any cause
whatsoever, and if, in the opinion of the Landlord reasonably
arrived at, the Leased Premises cannot be reconstructed,
rebuilt or repaired and made fit for the purposes of the
Tenant within one hundred and eighty (180) days of the
happening of the damage or destruction, the Landlord, instead
of reconstructing, rebuilding or repairing the Leased Premises
in accordance with Section 9.01(a), OR THE TENANT may at its
option elect to terminate this Lease by giving to the OTHER
PARTY Notice of termination within forty-five (45) days after
such damage or destruction, and thereupon Rent and other
payments for which the Tenant is liable under this Lease shall
be apportioned and paid to the date of such damage or
destruction, and the Tenant shall immediately deliver up
vacant possession of the Leased Premises to the Landlord in
accordance with the terms of this Lease.
(c) Upon the Tenant being given Notice by the Landlord that the
Landlord's reconstruction, rebuilding or repairs have been
substantially completed, the Tenant shall forthwith complete
all repairs to the Leased Premises which are the Tenant's
responsibility under Section 8.01 and all other work required
to fully restore the Leased Premises for business in every
case at the Tenant's cost and without any contribution to such
cost by the Landlord, whether or not the Landlord has at any
time made any contribution to the cost of supply, installation
or construction of Leasehold Improvements in the Leased
Premises. The Tenant shall diligently complete the Tenant's
repairs within sixty (60) days after notice that the
Landlord's reconstructing, rebuilding or repairs have been
substantially completed.
(d) Nothing in this Section 9.01 requires the Landlord to rebuild
the Leased Premises in the condition and state that existed
before any such occurrence, provided that the Leased Premises
as rebuilt will have reasonably similar facil |
