Exhibit 10.3
 
NET LEASE
 
PSS INVESTMENTS I INC.,
TPP INVESTMENTS I INC.,
THE GREAT-WEST LIFE ASSURANCE COMPANY and
LONDON LIFE INSURANCE COMPANY
 
as Landlord
 
AND
 
CRANIUM TECHNOLOGIES LTD.
 
as Tenant
 
BUILDING:
Tower 1 – 1959 Upper Water Street
Halifax, Nova Scotia
    PREMISES: Suite 506, 5th Floor     TERM: 3 Years    
DATE OF LEASE:
July 1, 2012

 
 
 

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SUMMARY OF BASIC TERMS
 
1.          
Landlord
PSS INVESTMENTS I INC., TPP INVESTMENTS I INC., THE GREAT-WEST LIFE ASSURANCE
COMPANY and LONDON LIFE INSURANCE COMPANY, acting and represented by GWL REALTY
ADVISORS INC.
       
Address of Landlord
First copy:
c/o GWL Realty Advisors Inc.
     
Suite 220
     
1949 Upper Water Street
     
Halifax, Nova Scotia
     
B3J 3N3
     
Attention: Senior Property Manager
           
Second copy:
do GWL Realty Advisors Inc.
     
2001 University Street
     
Suite 1820
     
Montreal, Quebec
     
H3A 2A6
     
Attention: VP, Asset Management
       
2.  
Tenant
Cranium Technologies Ltd.
         
Address of Tenant
82 Avenue Road
   
Toronto, ON M5R 2H2
       
3.  
Building
Tower I - 1959 Upper Water Street
   
Halifax, Nova Scotia
       
Project
Purdy's Wharf
     
4.
Premises
Suite 506
     
5.
Rentable Area of the Premises
Approximately 3,081 sq. ft.
     
6.
Term
3 Years
 
Commencement Date
July 1, 2012
 
Expiry Date
June 30, 2015
     
7.
Fixturing Period
June 15, 2012 – June 30, 2012
     
8.
Basic
Per Sq. Ft./Year
$18.50
  Rent
Per Year
$56,998.50
   
Per Month
$4,749.88
     
9.
Rent Deposit
$111,046.94 which will be applied to the first 6 months,  months 13, 14 and 15
and the last 3 months of the Term.

 
 
 

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TABLE OF CONTENTS
 
ARTICLE 1 - INTENT OF LEASE 
1
1.1
General Provisions 
1
     
ARTICLE 2 - DEFINITIONS 
1
2.1
In this Net Lease Agreement
1
     
ARTICLE 3 - DEMISE AND POSSESSION
2
3.1
Demise 
2
3.2
Delivery of Premises
2
3.3
Notice of Defects
2
3.4
Substitution of Premises
2
     
ARTICLE 4 - TERM OF LEASE 
3
4.1
General Provisions
3
     
ARTICLE 5 - MONIES PAYABLE BY TENANT
3
5.1
Rent
3
5.2
Business Taxes & Taxes on Improvements or Rent
3
5.3
Real Estate Taxes
3
5.4
Operating Expenses 
5
5.5
Payment of Monies 
7
5.6
Utilities 
8
     
ARTICLE 6 - USE OF PREMISES 
8
6.1
General Use
8
6.2
Restrictions
8
     
ARTICLE 7 - UTILITIES AND SERVICES
8
7.1
General Provisions 
8
7.2
Services for Special Equipment 
10
7.3
Discontinuance of Services
10
     
ARTICLE 8 - ALTERATIONS, REPAIRS, CHANGES, ADDITIONS, IMPROVEMENTS
11
8.1
General Provisions
11
8.2
No Allowance for Inconvenience
12
8.3
Connections to Electrical System
12
8.4
Landlord's Right to Perform
12
8.5
Termination of Lease
12
8.6
Installation of Necessary Equipment
12
     
ARTICLE 9 - TENANT CARE AND RESPONSIBILITY
13
9.1
General Provisions
13
9.2
Proceeds of Insurance
13
9.3
Tenant's Responsibility
13
9.4
Fire, Police and Health Departments' Regulations
14
9.5
Fire Protection Equipment
14
9.6
Exhibitions, Signs or Advertisements Inside or Outside the Premises
14
9.7
Supervision Fee for Tenant Repairs
14
9.8
Privileges and Liens
14
     
ARTICLE 10 - DESERTION AND SURRENDER
14
10.1
General Provisions
14
     
ARTICLE 11 - ASSIGNMENT AND SUBLETTING
15
11.1
General Provisions
15
11.2
Advertising the Premises for Subletting
15
11.3
Conditions Precedent to any Assignment or Subletting
15
11.4
Delays in Accepting Assignee or Subtenant
15
11.5
Transfer to Assignee or Subtenant
16
11.6
New Lease with Assignee 
16
     
ARTICLE 12 - FIRE AND DESTRUCTION OF PREMISES
16
12.1
If the Premises shall be destroyed or damaged by fire or other casualty,
insurable under fire and all risks insurance coverage, then:
 
12.2
Building Partially Destroyed or Damaged Affecting more than 20% of Rentable Area
16

 
 
 

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12.3
Insurance Proceeds 
17
12.4
Repair of Alterations, Improvements of Tenant's Property 
17
12.5
Where Tenant is at Fault
17
     
ARTICLE 13 - NO RESPONSIBILITY OF LANDLORD
17
13.1
General Provisions
17
13.2
Delay in Completion of Premises 
18
13.3
Tenant Indemnification 
18
13.4
Special Permits 
18
     
ARTICLE 14 - RIGHT OF ENTRY 
18
14.1
General Provisions
18
14.2
Alteration of Locks 
18
     
ARTICLE 15 - COMPLIANCE WITH LAW 
18
15.1
General Provisions 
18
     
ARTICLE 16 - INSURANCE REQUIREMENTS 
18
16.1
Landlord's Insurance 
18
16.2
Tenant not to Jeopardize Landlord's Insurance 
19
16.3
Tenant's Insurance 
19
16.4
Landlord's Right to Place Tenant's Insurance 
21
     
ARTICLE 17 - MORTGAGES AND SUBORDINATION
21

17.1
General Provisions 
21
17.2
Landlord's Default under any Underlying Lease, Mortgage, Hypothec or Deed 
21
17.3
Request from Landlord to Tenant for Written Statement
21
17.4
Certificate from Tenant 
22
17.5
Assignment by Landlord 
22
     
ARTICLE 18 - EXPROPRIATION
22
18.1
General Provisions 
22
     
ARTICLE 19 - WAIVER 
22
19.1
General Provisions 
22
     
ARTICLE 20 - NOTICES AND DEMANDS 
23
20.1
By Landlord to Tenant 
23
20.2
Tenant's Domicile 
23
20.3
By Tenant to Landlord 
23
20.4
Prior to Commencement Date 
23
     
ARTICLE 21 - LANDLORD AND TENANT 
23
21.1
Definition of Landlord 
23
21.2
Tenant Partner ship
23
21.3
Relationship between Landlord and Tenant 
24
     
ARTICLE 22 - BROKERAGE COMMISSION 
24
22.1
General Provisions 
24
     
ARTICLE 23 - SECURITY 
24
23.1
To Secure Payment of Rent 
24
     
ARTICLE 24 - EXPIRATION OF THE TERM OF THE LEASE
24
24.1
Tenant's Notice to Landlord 
24
24.2
Tenant's Credit Rating 
24
     
ARTICLE 25 - FORCE MAJEURE 
24
25.1
General Provisions 
24
     
ARTICLE 26 - GOVERNING LAW 
25
26.1
General Provisions 
25
     
ARTICLE 27 - PRIOR AGREEMENTS 
25
27.1
General Provisions 
25
27.2
Amendments of Lease 
25
     
ARTICLE 28 - RULES AND REGULATIONS
25
28.1
Acts to Injure Premises or Persons 
25
28.2
Preservation of Good Order and Cleanliness 
25
28.3
Animals 
25
28.4
Canvassing 
25

 
 
 

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28.5
Sidewalks, Entries, Passages, Elevators, etc. 
25
28.6
Advertising 
26
28.7
Signs or Advertisements on the Building 
26
28.8
Selling Articles or Carrying on Business other than that specifically provided
for in Lease 
26
28.9
Workmen for Repairs 
26
28.10
Care of Premises
26
28.11
Window Shades 
26
28.12
Washrooms 
26
28.13
Apparatus Requiring Permit 
26
28.14
Entering Building After Normal Office Hours 
26
28.15
Safes and Heavy Equipment 
27
28.16
Rules and Regulations for Security of Building 
27
28.17
Further Rules and Regulations 
27
28.18
Access to Loading Area 
27
28.19
Keys 
27
28.20
Graphics 
27
28.21
Environmental 
28
     
ARTICLE 29 - DEFAULT BY TENANT 
29
29.1
Events of Default 
29
29.2
The Exercise of any Right of Landlord 
30
29.3
No Waiver by Landlord 
30
29.4
Landlord's Right to Enter Premises 
30
29.5
No Limitation on Right to Distrain 
31
     
ARTICLE 30 - MISCELLANEOUS
31
30.1
Captions 
31
30.2
No Registration 
31
30.3
Tenants Acceptance of Lease 
31
30.4
Acknowledgement of Authority
31
30.5
Successors and Assigns
31
     
ARTICLE 31- SPECIAL CLAUSES
32
31.1
Condition of Premises 
32
31.2
Fixturing Period 
32
31.3
Extension of Term 
32
31.4
Parking 
32
31.5
Deposit
33
31.6
Environmental Assessment 
33

 
SCHEDULES
 
A
Description of Land
B 
Plan of Premises
C
Definition of Rentable Area Proportion Formula
D 
Building Standard Installation Schedule
E 
Environmental Assessment

 
 
 

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THIS NET LEASE entered into as of July 1, 2012.
 
BETWEEN:
 
PSS INVESTMENTS I INC., TPP INVESTMENTS I INC., THE GREAT-WEST LIFE ASSURANCE
COMPANY and LONDON LIFE INSURANCE COMPANY, (hereinafter collectively called the
"Landlord");
 
AND:
 
CRANIUM TECHNOLOGIES LTD., (hereinafter called the "Tenant");
 
ARTICLE 1- INTENT OF LEASE
 

1.1 General Provisions

 
It is the intent of the parties that this Net Lease be a lease that is
absolutely net to Landlord except as expressly hereinafter set out. Any amount
and any obligation as is not expressly declared herein to be that of Landlord
shall be deemed to be the obligation of Tenant to be performed by and at the
expense of Tenant.
 
ARTICLE 2- DEFINITIONS
 
2.1
In this Net Lease Agreement:
       
(1)
"lease" - any reference to the "lease" shall mean this Net Lease Agreement;
       
(2)  
"Phase I" means the lands and buildings known as the Purdy's Wharf Tower 1, 1949
Upper Water Street and Purdy's parking garage constructed at or near Upper Water
Street, Halifax, Nova Scotia;
       
(3) 
 "Phase II" means the lands and buildings known as Purdy's Wharf Tower II
including extension to the parking garage on lands at or near Upper Water
Street, Halifax, Nova Scotia;
       
(4)  
"Future Phases" means such future phases of the Purdy's Wharf Development as may
be constructed from time to time;
       
(5)  
"Land" means the land more particularly described in Schedule "A" attached
hereto;
       
(6) 
 "Building" means the buildings, structures and Improvements, including parking
garage constructed or to be constructed on the Land;
       
(7)  
"Common Areas" means all the facilities from time to time provided and
designated by Landlord to serve Phase I, Phase II, Future Phases, the Building
and the Land and shall include, where applicable, and without limitation,
roadways, walkways, sidewalks, parking facilities, landscaped areas, plazas,
lobbies, washrooms available for use of tenants and/or public, open or enclosed
pedestrian malls, courts, arcades, tunnels, bridges, truck courts, common
loading areas and delivery facilities, driveways, customer and service ramps,
stairways, escalators and elevators available for use by the public or by
tenants generally, fire detection, fire prevention and communication facilities,
common pipes, electrical, plumbing and other common mechanical and electrical
installations, equipment and services, public seating facilities, and all other
areas and facilities from time to time provided, designated, or made available
by Landlord for the use of Tenant and other tenants or members of the public,
Landlord expressly reserving the right to eliminate, substitute and/or rearrange
any or all of the areas so provided and designated without claim by Tenant in
respect of any such elimination, substitution or rearrangement;

 
 
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(8)  
"Premises" means that part of the Building which Tenant has agreed to rent from
Landlord and being that portion of the Building substantially as outlined in
heavy black on the plan attached hereto as Schedule "B";
       
(9)  
"Operating Year" means such fiscal period as Landlord shall adopt for the
purposes of the accounts relating to the Land and Building, provided that
Landlord shall be permitted at any time and from time to time to change the
commencement and termination dates of any Operating Year, so long as Tenant
shall not be unduly prejudiced by any such change;
       
(10)  
"Proportion" when used herein to refer to Tenant's share of any tax, expense or
cost shall be the percentage of the aggregate of any such tax, expense or cost
calculated as more particularly set out in Schedule "C" attached hereto.

  
ARTICLE 3- DEMISE AND POSSESSION  
 

3.1  Demise

 
Landlord in consideration of the rents, covenants and agreements herein
contained on the part of Tenant to be paid, kept and performed, does hereby
lease to Tenant and Tenant does hereby hire and take from Landlord the Premises,
together with a right of use, with others having a like right, to the Common
Areas.
 

3.2  Delivery of Premises

 
It is agreed between the parties hereto that the Premises are being delivered to
Tenant completed in accordance with Schedule "D" attached hereto (or with the
allowance to finish) all items set forth therein being hereinafter sometimes
collectively referred to as the "Alterations" which shall become the
responsibility of Tenant on and from the Commencement Date.
 

3.3 Notice of Defects

 
Taking possession of all or any portion of the Premises by Tenant shall be
conclusive evidence as against Tenant that the Premises or such portion thereof
are in satisfactory condition on the date of taking possession, subject only to
latent defects and to deficiencies (if any) listed by notice in writing
delivered by Tenant to Landlord not more than 30 days after the date of taking
possession.
 

3.4 Substitution of Premises

 
At any time after the execution of this lease, Landlord may substitute for the
Premises other premises in the buildings known as Purdy's Wharf Tower I, 1949
Upper Water Street or Purdy's Wharf Tower II (the "New Premises") in which event
the New Premises shall be deemed to be the Premises for all purposes hereunder,
provided:
 

 
(1)
The New Premises shall be similar to the Premises in area and in appropriateness
for use for Tenant's purposes;
       
(2)  
If Tenant is then occupying the Premises, Landlord shall pay the expense of
moving Tenant, its property and equipment to the New Premises, and such moving
shall be done at such times and in such manner so as to cause the least
inconvenience to Tenant;
       
(3)  
If Tenant is then occupying the Premises, Landlord shall give to Tenant not less
than 30 days' notice of such substitution, and if Tenant is not occupying the
Premises, Landlord shall give Tenant not less than 15 days' prior notice of such
substitution;
       
(4)  
Landlord shall, at its sole cost, improve the New Premises with Improvements
substantially similar to those located in the Premises.

 
 
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ARTICLE 4- TERM OF LEASE
 
4.1
General Provisions

 
The term of this lease shall commence on July 1, 2012 (the "Commencement Date")
and, unless the term shall sooner be terminated under the provisions hereof,
shall expire at 11:59 p.m. on June 30, 2015.
 
ARTICLE 5- MONIES PAYABLE BY TENANT
 
5.1
Rent

 
Tenant covenants and agrees to pay to Landlord yearly throughout the term of
this lease a Basic Rent computed at the rate of $18.50 per square foot of
rentable area of the Premises per annum (rentable area being calculated as more
particularly set out in Schedule "C"), said Basic Rent being payable in equal
monthly instalments in advance without set-off, compensation or reduction
whatsoever on the first day of each month during the term.
 
5.2
Business Taxes & Taxes on Improvements or Rent
         
5.2.1
Taxes Payable on Business and Improvements
           
Tenant shall pay all business taxes or other similar rates and taxes which may
be levied or imposed upon the Premises or the business carried on therein
including, without restricting the generality of the foregoing, any taxes or
other similar rates which may in the future be levied in substitution for
business taxes currently levied and whether levied against Landlord or Tenant;
all other rates and taxes which are or may be payable by Tenant as tenant and
occupants thereof; on Tenant's fixtures, equipment and machinery; and any and
all taxes that may be levied upon the Improvements (as hereinafter defined in
Article 8.1).
         
5.2.2
Tenant to Reimburse Landlord
                   
If by law, regulation or otherwise, business taxes or other similar rates and
taxes or taxes upon Tenant's fixtures, equipment, machinery or upon Improvements
are made payable by landlords or proprietors, or if the mode of collecting such
taxes and/or rates be so altered as to make Landlord liable therefor instead of
Tenant, Tenant shall repay to Landlord prior to the due date but, in any event
within 7 days after demand upon Tenant, the amount of the charge imposed on
Landlord as a result of such change, and shall save Landlord harmless from any
cost or expense in respect thereof.
         
5.2.3
Taxes Payable on Rent
           
If any business transfer tax, value-added tax, multi-stage sales tax, sales tax,
goods and services tax, blended or harmonized sales tax, or any like tax is
imposed on Landlord by any governmental authority on any rent (whether fixed
minimum rent, percentage rent, additional rent or any other type of rent)
payable by Tenant under this lease, Tenant shall reimburse Landlord for the
amount of such tax forthwith upon demand (or at any time designated from time to
time by Landlord) as additional rent. Landlord shall have the right, if
permitted by law, to require Tenant to pay directly to any taxing authority or
other supplier of goods or services the amounts which may otherwise be payable
by Landlord but chargeable to Tenant under this lease.
       
5.3
Real Estate Taxes
           
5.3.1
Definitions
           
For the purposes of this Article:
           
 (1)
"Real Estate Taxes" means all taxes, rates and assessments, general and special,
levied or imposed with respect to the Building (including any accessories and
Improvements therein or thereto) and the Land and all Improvements thereto
including where applicable, all taxes, rates, assessments and impositions,
general and special, levied or imposed for schools, public betterment, general
or local improvements.

 
 
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If the system of real estate taxation shall be altered or varied and/or any new
tax or levy shall be levied or imposed on the Building and/or the Land and/or
the revenues therefrom and/or Landlord in substitution for and/or in addition to
Real Estate Taxes presently levied or imposed on immovables in the city, town or
municipality in which the Building and Land are situate, then any such new tax
or levy shall be included within the term "Real Estate Taxes" and the provisions
of this Article 5.3 shall apply mutatis mutandis.
             
The amount of the Real Estate Taxes which shall be deemed to have been levied or
imposed with respect to the Building and the Land shall be such amount as the
legal authority imposing Real Estate Taxes shall have attributed to the Building
and the Land respectively, or, in the absence of such attribution, or, if such
legal authority shall include other immovables other than the Building and the
Land in imposing such Real Estate Taxes, such amount as Landlord in the exercise
of reasonable judgment shall establish.
           
(2)
  If, in any year, the taxing authority has not fully assessed and fully taxed
the Building and Land as entirely completed and entirely occupied by tenants
having no special exemptions with respect to Real Estate Taxes, then taxes shall
be adjusted and determined by including therein such additional amount as would
have formed part of Real Estate Taxes if the Building and Land had been fully
assessed and fully taxed as entirely completed and entirely occupied by tenants
having no special exemptions.
           
(3)
  Real Estate Taxes shall be determined without reference to, or deduction for,
any abatement, concession or reduction of taxes provided or granted as an
incentive to builders or developers and Real Estate Taxes shall be adjusted and
determined by including therein the amount of any such concession, abatement or
reduction.
         
5.3.2
Real Estate Taxes Payable
           
The rent payable during the term of this lease in respect of each year shall be
increased by an amount equal to the Proportion of Real Estate Taxes attributable
to such year. Tenant shall pay to Landlord, not later than 10 days prior to the
tax due date, or such other date as may be specified in writing to Tenant by
Landlord (hereinafter referred to as the "Specified Date"), the amount of such
increase in the annual rent.
           
At the option of Landlord, Landlord may at any time and from time to time
estimate the amount of increased rent as will become payable by Tenant by the
tax due date or Specified Date, and bill Tenant therefor, and in such event
Tenant shall pay to Landlord the full amount of such estimate in equal monthly
installments commencing with the first month following such estimate and
terminating on the tax due date or Specified Date. Such monthly amounts when
paid to Landlord shall be available (without interest) as a credit against
Tenant's obligations to Landlord under this Article 5.3.
           
Any amounts payable by Tenant hereunder shall be adjusted on a pro rata basis to
reflect the actual commencement and termination dates of this lease having
regard to the period in respect of which the calculation of Real Estate Taxes is
made.
           
The obligations of the parties hereto to adjust pursuant to this Article 5.3.2
for the final period of the lease shall survive the expiration of the term of
this lease.
           
Landlord shall furnish to Tenant upon the specific written request of Tenant
copies of all pertinent valuation and assessment notices and of all pertinent
tax bills and notices received by Landlord.

 
 
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5.3.3
Expenses for Contestation
           
Tenant shall pay to Landlord as additional rent the Proportion of any expenses,
including legal, appraisal, administration and overhead expenses, incurred by
Landlord in obtaining or attempting to obtain a reduction of any Real Estate
Taxes. Real Estate Taxes which are contested by Landlord shall nevertheless be
included for purposes of the computation of the liability of Tenant under
Article 5.3.2 provided, however, that in the event that Tenant shall have paid
any amount of increased rent pursuant to this Article 5.3 and Landlord shall
thereafter receive a refund of any portion of the Real Estate Taxes on which
such payment shall have been based, Landlord shall pay to Tenant the appropriate
portion of such refund after deduction of the aforementioned expenses.
           
Landlord shall have no obligation to contest, object to or to litigate the
levying or imposition of any Real Estate Taxes and may settle, compromise,
consent to, waive or otherwise determine in its discretion any Real Estate Taxes
without notice to, consent or approval of Tenant.
         
5.3.4
No Reduction in Rent
           
Nothing contained in this Article 5.3 shall be construed at any time so as to
reduce the monthly installments of rent payable hereunder below the amount
stipulated in Article 5.1.
       
5.4
Operating Expenses          
5.4.1
Definitions
           
For the purposes of this Article, "Operating Expenses" means the aggregate of
any and all expenses incurred by Landlord, without duplication thereto, which
are attributable to the maintenance, operation, repair, supervision or
replacement of the Building and the maintenance, operation and supervision of
the Land, provided that if the Building is less than 95% occupied during any
part of an Operating Year, Operating Expenses shall mean the amount obtained by
adjusting the actual Operating Expenses for such Operating Year to a 95%
building occupancy level, such adjustment to be made by adding to the actual
Operating Expenses during such Operating Year such additional costs that would
have been incurred if the Building had been 95% occupied. Without in any way
limiting the generality of the foregoing, Operating Expenses shall include the
following:
           
(1)
the cost of salaries, wages, medical, surgical and general welfare benefits
(including group life insurance) and pension payments for employees of Landlord
engaged in the maintenance, operation, repair, security or replacement of the
Building, payroll taxes, workmen's or workers' compensation insurance,
electricity (except as otherwise payable by Tenant hereunder), steam, utility,
taxes (not included in Articles 5.2 and 5.3), water (including sewer rental),
cleaning, building and cleaning supplies, uniforms and dry cleaning, cleaning of
windows and exterior curtain wall, snow removal, repair and maintenance of
grounds, service contracts, telephone, telegraph and stationery;
           
(2)  
the cost of heating, ventilating and air-conditioning the Building, including
without limitation the cost of operating, repairing, maintaining, replacing and
inspecting the machinery, equipment and other facilities required for the
heating, ventilating and air-conditioning of the Building and the cost of
providing condenser water from cooling towers for heating, ventilating and
air-conditioning machinery and equipment;
           
(3)  
the cost of goods and services, supplied, used or incurred in the operation,
maintenance, repair, security, supervision, replacement and management of the
Building and Land, or in the provision of services generally for the benefit of
tenants of the Building and their staff, the cost of providing hot and cold
water, the cost of maintenance of and repairs to the Building or services
including elevators, escalators, and any equipment, machinery or apparatus and
the cost of repair and replacement of windows and plate glass, including
exterior glass;

 
 
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(4)  
 
business and water taxes and governmental impositions not otherwise charged
directly to tenants, such portion or portions of large corporation tax,
commercial concentration tax or taxes on capital as Landlord shall have
allocated to the Building and Land, accounting and auditing costs, and the fair
rental value (having regard to rentals prevailing from time to time for similar
space) of space occupied by Landlord's employees for administrative, supervisory
or management purposes relating to the Building and the Land and of space
occupied by a party or parties providing a service generally for the benefit of
tenants in the Building and their staff (such as, by way of example, a day care
centre or fitness facilities);
           
(5)  
the cost of operating and maintaining the Common Areas including without
limitation all costs and expenses of repairing, lighting, cleaning, snow
removal, garbage removal, decorating, supervising, policing, replacing,
striping, rental of music programme and loudspeaker systems, and business taxes
and governmental impositions not otherwise charged directly to tenants; the cost
of operating and maintaining those of the Common Areas which serve more than one
of Phase I, Phase 11 and/or any Future Phases shall be allocated as between
phases on a pro rata basis based upon the rentable area contained in each phase
or such other basis as Landlord may reasonably determine;
           
(6)  
the cost of any modification and additions to the Building and/or the machinery
and equipment therein and thereon where in the reasonable opinion of Landlord
such expenditure may reduce Operating Expenses, or any additional equipment or
Improvements required by law or in Landlord's reasonable opinion for the benefit
or safety of Building users;
           
(7)  
the total annual amortization of capital (on a straight line basis over the
useful life or such other period as reasonably determined by Landlord), and
interest on the unamortized capital at a rate equivalent to the lending rate
actually charged or chargeable by Landlord's bankers from time to time, of the
cost of all machinery, equipment, supplies, repairs, replacements, modifications
and Improvements which in Landlord's reasonable opinion have an estimated useful
life longer than one fiscal year of Landlord and the cost whereof has not
previously been charged to Tenant;
           
(8)  
the actual costs of all insurance as may be carried by Landlord in respect of,
or attributable to, the Building and the Land or related thereto including
without limitation all risk insurance against fire and other perils and
liability regarding casualties, injuries and damages, boiler and machinery
insurance and rental income insurance;
           
(9) 
a management charge equal to 15% of such total costs incurred.
         
5.4.2
Operating Expenses Payable
           
During each Operating Year Tenant shall pay to Landlord as additional rent the
Proportion of the Operating Expenses.
         
5.4.3
Operating Expense Estimate
           
Prior to the commencement of each Operating Year during the term, Landlord may
at its option estimate the amount of Operating Expenses for such Operating Year
or (if applicable) broken portion thereof, as the case may be, and notify Tenant
in writing of the amount of its Proportion of Operating Expenses. The amounts so
estimated shall be payable in equal consecutive monthly instalments in advance
over such Operating Year or (if applicable) broken portion thereof, such monthly
instalments being payable on the same day as the monthly payments of rental.
Landlord may, from time to time, alter the Operating Year, in which case, and in
the case where only a broken portion of the Operating Year is included within
the term of this lease, the appropriate adjustment in monthly payments shall be
made.

 
 
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From time to time during the Operating Year, Landlord may re-estimate any of the
foregoing on a reasonable basis for such Operating Year or broken portion
thereof, in which event Landlord shall notify Tenant in writing of such
re-estimate and fix monthly instalments for the then remaining balance for such
Operating Year or broken portion thereof such that, after giving credit for the
instalments paid by Tenant on the basis of the previous estimate or estimates,
the entire amount of its Proportion of Operating Expenses will have been paid
during such Operating Year or broken portion thereof.
         
5.4.4
Operating Expense Statement
           
As soon as practicable after the expiration of each Operating Year, Landlord
shall make a final determination of Operating Expenses and the amounts of the
Proportion thereof for such Operating Year, or (if applicable) broken portion
thereof, and provide Tenant with an audited statement of Operating Expenses; and
Landlord and Tenant agree to immediately make the appropriate readjustment and
payments and repayments. Notices by Landlord stating the amount of any estimate,
re-estimate or determination of Operating Expenses, or the amount of the
Proportion of Operating Expenses, or monthly instalments payable, need not
include particulars of Operating Expenses. Provided, however, that upon request
made within a reasonable time after receipt of such notice Tenant shall be
entitled to inspect statements disclosing in reasonable detail the particulars
of Operating Expenses, and the calculation of the amount of its Proportion of
Operating Expenses and the books and records of Landlord pertaining thereto.
         
5.4.5
Payment for Final Period of Lease
           
The obligations of the parties hereto to adjust pursuant to Article 5.4.4 hereof
shall survive the expiration of the term of the lease.
       
5.5
Payment of Monies
         
5.5.1
Method of Payment
           
Unless otherwise required by the Landlord, the Tenant will pay to the Landlord
all monthly instalments of Basic Rent, Real Estate Taxes and Operating Expenses,
plus applicable taxes, required to be paid by the Tenant under the Lease, in
advance, by way of a pre-authorized bank debit payment system. Concurrently with
the execution and delivery of the Lease by the Tenant to the Landlord, and from
time to time throughout the Term, the Tenant will execute and deliver to the
Landlord all pre-authorization documentation as may be requested by the Landlord
or as may otherwise be necessary in order to enable the Landlord to debit the
Tenant's bank account on the first day of each and every month throughout the
Term.
           
All other monies payable pursuant to this Lease by Tenant shall be payable
immediately when due and shall be collectible as rent and shall be paid to
Landlord and/or its nominees at the head office of Landlord or at such place in
Canada as shall be designated from time to time by Landlord in writing to
Tenant.
         
5.5.2
For a Fraction of a Month
           
If the term of this lease begins on any day of the month other than the first
day, then any amounts payable hereunder for such month shall be pro rated and
paid on a per diem basis.
         
5.5.3
Adjustments Between Estimated and Actual Amounts Payable
           
Upon final determination of the actual amounts payable by Tenant the parties
shall adjust any differences between the estimated amounts so paid and the
actual amounts payable.

 
 
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5.5.4
Interest on Overdue Amounts
           
Tenant shall pay interest at a rate per annum, which shall be the lesser of:
           
(1)  
the maximum legal rate of interest permissible in the applicable jurisdiction,
             
or
           
(2)  
3 percentage points above the prime lending rate established from time to time
at the principal branch in the city of Landlord's bank,
           
compounded monthly on all rent and/or all amounts collectible as rent under the
terms of this lease and not paid when due.
         
5.5.5
No Offsets Against Rent
           
Tenant hereby waives and renounces any and all existing and future claims,
set­off and compensation against any rent or other amounts due hereunder and
agrees to pay such rent and other amounts regardless of any claim, set-off or
compensation which may be asserted by Tenant or on its behalf.
         
5.5.6
On Termination of Lease
           
Upon any termination of this lease, as a condition precedent to being permitted
by Landlord to vacate the Premises, Tenant shall, in addition to all other
amounts as it is obliged to pay hereunder, pay to Landlord such amount as is
estimated by Landlord to represent that portion of the aggregate amount of Real
Estate Taxes and Operating Expenses payable and to become payable by Tenant in
virtue of Articles 5.3 and 5.4 hereof, as has not yet been paid.
       
5.6
Utilities
         
5.6.1
General Provisions
           
Tenant shall be solely responsible for and promptly pay all charges for water,
gas, electricity, and any other utility used or consumed in the Premises.

 
ARTICLE 6- USE OF PREMISES
 
6.1
General Use

 
The Premises hereby leased shall be used and occupied by Tenant solely for the
purpose of an operation of a primarily inbound contact centre, carried under the
firm name and style "Biologix Hair Inc.", however, in no case shall the
occupancy of the Premises exceed one person to every one hundred (100) square
feet of useable area of the Premises, and for general office use and for no
other purpose.
 
6.2
Restrictions

 
And in particular and by way of further restriction to the specific purposes
herein set forth Tenant shall not carry on in the Premises (i) outbound contact
centre; (ii) a restaurant, cafeteria or cocktail lounge business and/or the sale
and/or delivery of food and/or beverages; or (iii) any other activity restricted
by the rules and regulations hereof.
 
ARTICLE 7- UTILITIES AND SERVICES
 
7.1
General Provisions

 
Landlord covenants and agrees that, so long as Tenant shall not be in default
hereunder:
 

  7.1.1
Cleaning
 
Landlord shall, 5 days per week, except holidays, cause the office portion of
the Premises, excluding storage areas, to be cleaned in accordance with Building
standards.

 
 
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7.1.2
Elevators
           
Landlord will provide and maintain in working order automatic passenger
elevators for operation between the hours of 7:00 a.m. and 6:00 p.m. for each
business day, except Saturdays when the hours shall be from 7:00 a.m. to 12:00
noon, and one such passenger elevator will be subject to call at all other
times. Landlord shall be under no obligation to provide operators for any such
passenger elevators and the fact that Landlord may from time to time in its
discretion provide operators shall in no way obligate Landlord to continue such
provision.
           
Freight service will be provided at such hours as Landlord may designate from
time to time, and shall be subject to a charge as determined from time to time
by Landlord.
           
Tenant shall have the use of the elevators in common with others but Landlord
shall not be liable for any damage caused to Tenant and its officers, agents,
employees, servants, visitors or licensees by such others using the elevators in
common.
         
7.1.3
Electric Energy
           
(1)
)Landlord, subject to its ability to obtain the same from its principal supplier
and to the needs of Landlord and co-tenants, shall cause the Premises to be
supplied with electric current for lighting and power. Landlord shall permit its
wires and conduits, (being normal office lighting and duplex receptacles) to be
used for such purpose. Tenant's use of electric current shall never exceed the
safe capacity of existing electrical wiring on, and supplying the Premises.
             
Any special wires and conduits for Tenant's special equipment shall be supplied
and installed by Tenant at its expense.
             
Tenant agrees to receive power for the purpose of lighting and normal office use
from Landlord, the cost of which will be included in the Operating Expenses of
the Building. Should Tenant require power in excess of that required for a
normal office operation, Tenant agrees to pay for such additional power and such
amount shall be collectible as rent. The amount shall be payable by Tenant
monthly, and shall be calculated in such a manner that it shall not exceed the
amount that would have been payable for the said electricity had Tenant been
charged directly for the electricity at the rate fixed by the authority
providing the same. The charge to Tenant for this electricity may vary from time
to time in accordance with changes in the rate charged to Landlord. Any rental
so collected will be credited to the total light and power expense of the
Building prior to determining a Tenant's Proportion of Operating Expenses.
             
The cost of any required sub-meters and the installation thereof shall be at
Tenant's expense.
             
The obligation of Landlord hereunder shall be subject to any rules or
regulations to the contrary of the authority providing electricity or any other
municipal or governmental authority.
           
(2)  
Tenant agrees to pay the cost, including installation, of all electric light
bulbs, tubes and ballasts used to replace those installed in the Premises at the
commencement of the term and the cost of cleaning, maintenance and repair of the
fluorescent fixtures as may be from time to time required by Landlord in
accordance with prudent building management practices and Landlord shall at its
option have the exclusive right to provide and carry out at Tenant's expense
such installations, maintenance, repair, relamping and destaticizing at
reasonably competitive rates.
           
(3)  
Any electrical energy consumed in the Premises in excess of 2.3 watts per square
foot multiplied by 60 hours per week, multiplied by the rentable area of the
Premises, shall be billed to and paid for by Tenant.

 
 
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7.1.4
Drinking Water, Towels and Toiletries
           
Landlord will provide to Tenant, its agents, servants, employees and invitees
the right of access and use in common with other tenants of the Building to the
toilet and washroom facilities in the Building and to keep the same in good
working order and supplied with water and to have the same repaired with all
reasonable diligence whenever such repairs are necessary, and to furnish soap,
towels, toilet tissue and hot and cold water for lavatory, drinking and cleaning
purposes, drawn through fixtures installed by Landlord, subject to its ability
to obtain same from its principal supplier.
         
7.1.5
Heating or Air-Conditioning
           
Landlord will provide, by operation of the heating or air-conditioning system
between the hours of 7:00 a.m. and 6:00 p.m. of each business day, except
Saturdays which shall be between the hours of 7:00 a.m. and 12:00 noon, and
except Sundays and holidays, a constant supply of air that is filtered and
either heated or cooled as conditions may require, subject to the following
conditions and provisions:
           
Landlord shall be under no obligation to operate the air-conditioning system in
excess of what may be, in its opinion, reasonable and normal in the
circumstances and, in any event, and without prejudice to the foregoing,
Landlord shall be deemed to have fully satisfied its obligation under this
Article 7.1.5 if it shall, when the exterior temperature is higher than 90°F.
maintain a maximum interior temperature 10°F. less and when the exterior
temperature is not higher than 90°F. and not lower than -20°F., maintain an
interior temperature between 70°F. and 80°F. and, when the exterior temperature
is lower than -20°F. maintain a minimum interior temperature 90°F. higher than
the exterior temperature, provided always, however, that the obligations of
Landlord hereunder shall be conditional upon the following:
           
(1)  
Tenant keeping all exterior windows closed at all times and keeping all
registers free from obstruction so as to permit the proper flow and circulation
of air therefrom;
           
(2)  
the average amount of electrical energy consumed by lights and machines in the
Premises not exceeding 2.3 watts per square foot;
           
(3)  
the occupancy of the Premises not exceeding one person per hundred square feet
of useable space.
           
All individual controls required by Tenant, except those set forth in the
attached Schedule "D" shall be installed at Tenant's expense.
           
In case Landlord deems it necessary to run portions of the system through the
Premises in order to serve other tenants, Tenant shall permit Landlord and its
agents and contractors to perform such work in the Premises.
           
Should Tenant require heating and/or air-conditioning at any time other than
specified above, such service if supplied, shall be at the entire cost of
Tenant.
       
7.2
Services for Special Equipment
       
Nothing contained in this lease shall be deemed to create any obligation of
Landlord to furnish electricity, heating, air-conditioning or any other services
to Tenant to the extent these are required by the use in the Premises of special
equipment such as computers or other electrical or similar equipment.
       
7.3
Discontinuance of Services
       
Landlord shall be privileged, without liability or obligation to Tenant, and
without such action constituting an eviction of Tenant, to discontinue or modify
any services required of it under this Article 7 or elsewhere in this lease
during such times as may be necessary, or as Landlord may deem advisable by
reason of accident, or for the purpose of effecting repairs, replacements,
       
Alterations or Improvements. Without limiting the foregoing, Landlord shall not
be liable to Tenant for failure for any reason to supply the said services or
any of them, Landlord however, undertaking to correct any such failure with
reasonable diligence.

 
 
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ARTICLE 8- ALTERATIONS, REPAIRS, CHANGES, ADDITIONS, IMPROVEMENTS
 
8.1
General Provisions

 

 
8.1.1
Consent of Landlord          
Landlord and Tenant agree that any and all Alterations, repairs, changes,
additions or Improvements (hereinafter collectively referred to as the
"Improvements") to the Premises, including without restricting the generality of
the foregoing, any Improvements to the heating, ventilating and air-conditioning
systems (HVAC Systems) serving the Premises must comply with Landlord's Building
Standard, including without restricting the generality of the foregoing
Landlord's Building Standard Air Quality Control.
        8.1.2
Building Standard Air Quality Control
         
Tenant shall not, prior to or duri ng the term of this lease, make any
Improvements to the Premises including the HVAC System without the prior written
consent of Landlord. Any Improvements to the Premises made by Tenant from time
to time shall at all times include such Improvements to the HVAC System as may
be required to maintain Landlord's Building Standard Air Quality Control.
         
For purposes of this Article 8.1.2, Improvements to the Premises requiring
modification to the HVAC System shall include any modifications from time to
time to the approved office layout for the Premises to which the HVAC System has
been designed by way of partitions, personnel and equipment changes or
otherwise, and the HVAC System shall be altered to suit such modified Premises
accordingly.
        8.1.3
Landlord's Prior Consent
         
All plans for Improvements, including engineering designs and plans, including
Improvements to the HVAC System must have prior approval and written consent of
Landlord before the commencement of work. All such Improvements shall be done at
Tenant's expense by such contractor or contractors as Tenant may select subject
to Landlord's approval. Landlord shall also have the right to have any such work
supervised by its architects, engineers, contractors and workmen at Tenant's
expense.
        8.1.4
Tenant's Contractor
         
In the event that any contractor is not satisfactory to Landlord, or is causing,
or in Landlord's reasonable opinion is likely to cause, labour trouble in the
Building, Landlord shall have the right to require that such contractor cease or
refrain from doing any work in the Premises and upon receipt of written notice
from Landlord, Tenant agrees to disallow such contractor from entering the
Premises. Landlord shall also have the right to require that any contractor
carry property damage and public liability insurance in an amount acceptable to
Landlord and in no event less than $1,000,000 for its operations in the
Building. The work necessary to perform any Improvements or repairs shall be
performed at such times and in such a manner as to not unreasonably interfere
with other tenants.
        8.1.5
Tenant Responsible for Cost of Improvements
         
The cost of the Improvements shall be the sole responsibility of Tenant and if
any payment in respect thereof shall be made by Landlord the same shall be paid
in advance to the Landlord by Tenant. Landlord shall not, for any reason
whatsoever, be liable for any damage arising from or through any defects in the
said work.

 
 
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  8.1.6
Tenant Responsible for Construction of Improvements
         
Except to the extent of Landlord's work as set out in Schedule "D" Tenant shall
be fully responsible for the cost of all Improvements to the Premises including,
without restriction, the engineering cost of designing the electrical, heating,
ventilating and air conditioning systems for the Premises, utilizing engineers
as Tenant may select, subject, however, to Landlord's approval.
        8.1.7
Additional Improvements
         
If Tenant constructs Improvements beyond those constructed at the time of
Tenant's initial occupancy of the Premises, Tenant shall pay to Landlord an
amount equal to 10% of the cost of construction of such additional Improvements
in respect of Landlord's cost incurred in coordination and inspection with
respect to such Improvements.
       
8.1.8
Removal of Improvements
         
Any Improvements made to the Premises shall not be removed either before or
after the termination of this lease without the consent or request of Landlord.

 
8.2
No Allowance for Inconvenience

 
There shall be no allowance to Tenant for diminution of rental value and no
liability on the part of Landlord by reason of inconvenience, annoyance or
injury to business arising from Landlord, Tenant or others making or failing to
diligently make any repairs, Alterations, additions or Improvements in or to any
portion of the Building or the Premises or in and to the fixtures, equipment or
appurtenances thereof.
 
8.3
Connections to Electrical System

 
Any connection of apparatus to the electrical system other than a connection to
an existing base receptacle, any connection of apparatus to the plumbing lines,
or any connection to the heating and/or the air-conditioning system shall be
deemed to be an Improvement within the meaning of this Article 8.
 
8.4
Landlord's Right to Perform

 
In the event that Tenant should fail to carry out its obligations hereunder to
the satisfaction of Landlord, Landlord shall perform such maintenance and
repairs it considers necessary from time to time, the costs of which shall be
the sole responsibility of Tenant and if any payment in respect thereof shall be
made by Landlord then a sum equal to the amount so paid shall forthwith become
due and payable by Tenant to Landlord and if Tenant shall neglect or refuse to
pay such amount on demand, any such cost or expense to Landlord shall be
recoverable as additional rent.
 
8.5
Termination of Lease

 
At the termination of this lease for whatever reason, Tenant shall, if so
required by Landlord, remove all or specified Improvements including, without
limiting the generality of the foregoing, all Alterations and/or Improvements
installed by Landlord and/or Tenant in the Premises, pursuant to the terms of
this lease and regardless of whether Landlord or Tenant is or was responsible
for the cost thereof. Tenant shall thereupon become obligated to restore the
Premises to their original condition, (save for such Improvements as Landlord
permits to remain) ordinary wear and tear excepted. Should Tenant not be
required to remove any Alterations and/or Improvements, they shall remain in the
Premises as the property of Landlord.
 
8.6
Installation of Necessary Equipment

 
Landlord shall have the right to install and maintain in the Premises whatever
is reasonable, useful or necessary for the equipment, use and convenience of the
Building or other tenant, and Tenant shall have no claim against Landlord in
respect thereof provided the same does not interfere with Tenant's enjoyment of
the Premises.
 
 
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ARTICLE 9- TENANT CARE AND RESPONSIBILITY
 
9.1
General Provisions

 
Except as otherwise specifically provided in this lease:
 
(1)  
Tenant shall be solely responsible for, and pay the cost of all repairs of every
nature and kind to the Premises other than maintenance, repairs and rebuilding
thereof which in the reasonable opinion of Landlord would constitute major
structural repairs to the Building; and

 

(2)  
Tenant shall pay the cost in the Proportion set forth in Article 2.1(10) hereof
for all other repairs of every nature and kind (including major structural
repairs) to the structural elements of the Building, as effected by Landlord in
the following categories:

 
(a)     repairs, maintenance and replacement of every nature to the Building;
 
(b)     modernization and Improvements to the Building,
 
(i)  
where in the reasonable opinion of Landlord any such expenditure may reduce the
annual Operating Expenses to be paid by tenants, or

 
(ii)  
additional equipment or Improvements required by law or in Landlord's reasonable
opinion for the safety of Building users,

 
and without limiting the generality of the foregoing, Tenant shall take care of
the Premises and the Alterations and Improvements therein and, at the expiration
or other termination of the term of this lease shall surrender the Premises,
including the Alterations and Improvements in as good condition as reasonable
use will permit. Tenant shall give to Landlord immediate verbal and prompt
written notice of any accident to or defect in the water pipes, steam pipes,
heating or air-conditioning equipment, electric light, elevators, wires or other
services of any portion of the Premises.
 
9.2
Proceeds of Insurance

 
Landlord shall make all reasonable attempts to utilize the proceeds of insurance
as well as to exercise any and all reasonable recourses available to Landlord
against any contractor, builder, supplier or any third party in order to reduce
Tenant's liability for repairs, maintenance, replacements, modernization and
Improvements, provided however, that Tenant shall notwithstanding any such
proceedings advance the amounts required to be paid by Tenant hereunder and to
receive its proportion of any reimbursement so obtained by Landlord, and
provided further that Tenant shall advance its proportionate share being the
Proportion utilized in Article 2.1(10) of costs and expenses of any legal action
as Landlord may institute against any such party.
 
Landlord shall have no obligation to litigate any such claim and may settle,
compromise, consent to, waive or otherwise determine in its discretion any claim
without notice to, consent or approval of Tenant.
 
9.3
Tenant's Responsibility

 
Tenant shall be solely responsible for any and all injury and damages suffered
by Landlord and/or Tenant and/or co-tenants or other occupants of the Building
and their respective officers, agents, employees, servants, visitors,
contractors, subcontractors and suppliers, and for any and all injury or damage
to the Building and/or to the Premises, and/or the Alterations, and/or the
Improvements, and/or the furnishings, fixtures, partitions or any equipment or
merchandise (including damage caused by the overflow or escape of water, steam,
gas, electricity or other substance, or the falling of any substance), caused or
occasioned by Tenant, or the officers, agents, employees, servants, visitors,
contractors, subcontractors and suppliers of Tenant, and whether due to
negligence or careless operation or otherwise. Any and all such injury and
damages may be repaired by Landlord at the expense of Tenant.
 
 
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9.4
Fire, Police and Health Departments' Regulations

 
Tenant shall not do, or permit anything to be done on or about the Premises or
the Building or the Land which may injure or obstruct the rights of Landlord, or
of co-tenants or other occupants of the Building, or of owners or occupants of
adjacent or contiguous property, or do anything which is a nuisance, and Tenant
shall not do or permit anything to be done on or about the Premises or the
Building or the Land or bring or keep anything therein which will in any way
conflict with the regulations of the Fire, Police, or Health Departments or with
the rules, regulations, by-laws or ordinances of any governmental authority
having jurisdiction over the Premises and/or the Building and/or the Land, all
of which Tenant undertakes to abide by and conform to.
 
9.5
Fire Protection Equipment

 
Tenant specifically undertakes to install and maintain at its cost such fire
protection equipment including, without limitation, emergency lighting as is
deemed reasonably necessary or desirable by Landlord or any governmental or
insurance body, and if so required by Landlord or any such body Tenant shall
appoint a warden to coordinate with the fire protection facilities and personnel
of Landlord.
 
9.6
Exhibitions, Signs or Advertisements Inside or Outside the Premises

 
No activity considered offensive or improper by Landlord shall be permitted by
Tenant in or about the Premises, the Building or the Land, and no sign,
advertisement, notice, awning or electrical display shall be placed on any part
of the outside or inside of the Premises and/or the Building and/or the Land, or
in any area near the same, except with the written consent of Landlord.
 
Landlord shall have the right in its absolute discretion to enter into the
Premises or the Building or the Land and to remove and/or eliminate anything not
in conformity herewith.
 
9.7
Supervision Fee for Tenant Repairs

 
Should Landlord deem it necessary to undertake any repairs or to do anything
which is required to be undertaken or done by Tenant under this lease then
Tenant shall pay to Landlord as a fee for supervision or carrying out of
Tenant's obligation an amount as additional rent equal to 15% of the cost of the
obligation, repairs or other work, carried out by or under the supervision of
Landlord, which amount shall be in addition to the cost of such obligation or
work and shall be collectable by Landlord from Tenant as if it were rental in
arrears.
 
9.8
Privileges and Liens

 
Tenant shall require that any contractors, prior to effecting any work on the
Premises, and if permitted under the governing law, provide Landlord with a
waiver and release of any and all privileges or rights of privilege or liens
that may then or thereafter exist for work done/or to be done or labour
performed/or to be performed or material furnished/or to be furnished under any
contract or subcontract; or in the event such waiver and release is not
permitted or is not obtained, furnish adequate security acceptable in all
respects to Landlord to guarantee the payment in full for all such work, labour
or materials.
 
In any event, any mechanics' lien or privilege filed against the Premises or the
Building for work claimed to have been done or materials furnished to Tenant
shall be discharged by Tenant within 10 days thereafter at Tenant's expense. For
the purposes hereof, the bonding of such lien by a reputable casualty or
insurance company reasonably satisfactory to Landlord shall be deemed the
equivalent of a discharge of any such lien. Should any action, suit or
proceeding be brought upon any such lien for the enforcement or foreclosure of
the same, Tenant agrees, at its own cost and expense, to defend Landlord
therein, by counsel satisfactory to Landlord, and to pay any damages and satisfy
and discharge any judgment entered therein against Landlord.
 
ARTICLE 10- DESERTION AND S URRENDER
 
10.1
General Provisions

 
Tenant shall not leave the Premises unoccupied or vacant (and surrender of the
keys shall not be necessary in order that the Premises may be deemed unoccupied
or vacant) during the term of this lease. Acceptance of the surrender of this
lease shall not be effective unless made in writing and signed by Landlord.
 
 
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ARTICLE 11- ASSIGNMENT AND SUBLET TING
 
11.1
General Provisions

 
Tenant shall not be entitled to assign, transfer or encumber this lease, or any
part thereof, or any of Tenant's title or interest therein or thereto, or sublet
the whole or any part of the Premises or permit the Premises or any part thereto
to be used by another without conforming to the terms of the next paragraph
hereof, and in any event without the prior written consent of Landlord, which
consent shall not be unreasonably withheld. Landlord's refusal of consent shall
be deemed reasonable (without in any way restricting Landlord's right to refuse
its consent on other reasonable grounds) where the assignee or sub-tenant
proposed by Tenant is then a tenant of the Building and Landlord has or will
have during the next ensuing 6 months suitable space for rent in the Building.
The consent of Landlord to any such assignment, transfer, encumbrance,
subletting and/or use shall not constitute a waiver of this Article, and shall
not be deemed to permit any further assignment, transfer, encumbrance,
subletting or use by another. Notwithstanding any such assignment, transfer,
encumbrance, subletting and/or use, Tenant shall remain jointly and severally,
without benefit of division or discussion, responsible for the payment of the
rental and the performance of the other obligations of Tenant under this lease.
 
The following shall be deemed to be an assignment or sublease for the purpose of
the lease and shall require the prior written consent of Landlord and the prior
compliance with all of the provisions of this Article 11:
 
(1)  
if any person other than Tenant has or exercises the right to occupy, manage or
control the Premises or any part thereof, or any of the business carried on
therein, other than subject to the direct and full supervision and control of
Tenant; or

 
(2)  
if effective control of Tenant is acquired or exercised by a person not having
effective control of Tenant at the date of execution of the lease.

 
11.2
Advertising the Premises for Subletting

 
Tenant shall not print, publish, post, mail, display, broadcast or otherwise
advertise or offer the whole or any part of the Premises for purposes of
assignment, sublet, transfer or encumbrance, and shall not permit any broker or
other party to do any of the foregoing, unless the complete text and format of
any notice, advertisement or offer for any of the aforesaid purposes shall have
first been approved in writing by Landlord. Without in any way restricting or
limiting Landlord's right to refuse any text and format on other grounds, any
text and format proposed by Tenant shall not contain any reference to the rental
rate for the Premises.
 
11.3
Conditions Precedent to any Assignment or Subletting

 
As a condition precedent to any assignment of this lease or subleasing of the
whole or any part of the Premises:
 
(1)  
Tenant shall indicate to Landlord the bona fide assignee or sub-tenant and the
specific terms and conditions of such proposed assignment or sublease; and

 
(2)  
Tenant shall first offer to assign or sublease, as the case may be, to Landlord
on the same terms and conditions and for the same rental as provided in this
lease.

 
11.4
Delays in Accepting Assignee or Subtenant

 
Landlord shall have a period of 30 days in which to accept the offer referred to
in Article 11.3(2) and if not so accepted Tenant shall have a period of 60 days
thereafter in which to assign or sublease on obtaining the prior written consent
of Landlord as hereinabove provided to the party and in accordance with the
terms and conditions so indicated to Landlord.
 
 
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11.5
Transfer to Assignee or Subtenant

 
In the event that Tenant does not so assign or sublet within such 60 day period,
Landlord's consent to such assignment or subleasing shall be deemed null and
void and Tenant shall not be permitted to assign or sublet without again
conforming to all of the express provisions hereof.
 
11.6
New Lease with Assignee

 
As an alternative to giving its consent to any sublease or assignment of lease,
Landlord shall have the right to require the prospective sub-tenant or assignee
to execute a new lease with Landlord under the same terms and conditions as
contained in the offer from the bona fide assignee or sub-tenant, and in such
event Tenant agrees to guarantee to Landlord (on Landlord's standard form of
guarantee) the performance of all obligations of such sub-tenant or assignee
under the new lease. Tenant agrees to pay to Landlord reasonable costs of
administration incurred by Landlord to effect such new lease.
 
ARTICLE 12- FIRE AND DESTRUCTION OF PREMISES
 
12.1
If the Premises shall be destroyed or damaged by fire or other casualty,
insurable underfire and all risks insurance coverage, then:

 

 
(1)
Premises Wholly Unfit for Occupancy and Not Repairable within 180 Days          
If in the opinion of Landlord the damage or destruction is such that the
Premises are rendered wholly unfit for occupancy or it is impossible or unsafe
to use and occupy them, and if in either event the damage, in the further
opinion of Landlord (which shall be given by written notice to Tenant within 30
days of the happening of such damage or destruction) cannot be repaired with
reasonable diligence within 180 days from the happening of such damage or
destruction, either Landlord or Tenant may within 5 days next succeeding the
giving of Landlord's opinion as aforesaid, terminate this lease by giving to the
other notice in writing of such termination, in which event the term of this
lease shall cease and be at an end as of the date of such destruction or damage
and the rent and all other payments for which Tenant is liable under the terms
of this lease shall be apportioned and paid in full to the date of such
destruction or damage. In the event that neither Landlord nor Tenant so
terminates this lease, rent shall abate from the date of the happening of the
damage until the damage shall be made good to the extent of enabling Tenant to
use and occupy the Premises;
       
(2)
Premises Wholly Unfit for Occupancy and Repairable within 180 Days          
If the damage be such that the Premises are wholly unfit for occupancy, or if it
is impossible or unsafe to use or occupy them but if in either event the damage,
in the opinion of Landlord (which shall be given to Tenant within 30 days from
the happening of such damage) can be repaired with reasonable diligence within
180 days of the happening of such damage, rent shall abate from the date of the
happening of such damage until the damage shall be made good to the extent of
enabling Tenant to use and occupy the Premises;
       
(3)
Premises Partially Damaged and Repairable within 180 Days          
If in the opinion of Landlord, the damage can be made good as aforesaid within
180 days of the happening of such destruction or damage, and the damage is such
that the Premises are capable of being partially used for the purposes for which
leased, until such damage has been repaired, rent shall abate in the proportion
that the part of the Premises rendered unfit for occupancy bears to the whole of
the Premises.

 
12.2
Building Partially Destroyed or Damaged Affecting more than 20% of Rentable Area

 
If the Building is partially destroyed or damaged so as to affect 20% or more of
the rentable area of the Building containing the Premises, or in the opinion of
Landlord the Building is rendered unsafe, and whether or not the Premises are
affected, and in the opinion of Landlord (which shall be given by written notice
to Tenant within 30 days of the happening of such damage or destruction), cannot
be repaired with reasonable diligence within 180 days from the happening of such
damage or destruction, Landlord may within 5 days next succeeding the giving of
Landlord's opinion as aforesaid, terminate this lease by giving to Tenant notice
in writing of such termination, in which event the term of this lease shall
cease and be at an end as of the date of such destruction or damage and the rent
and all other payments for which Tenant is liable under the terms of this lease
shall be apportioned and paid in full to the date of such destruction or damage.
 
 
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12.3
Insurance Proceeds

 
In the event of the termination of this lease as hereinabove provided, all
insurance proceeds excluding those relating to Tenant's property to the extent
Tenant is not indebted to Landlord under the provisions of this lease, shall be
and remain the absolute property of Landlord.
 
12.4
Repair of Alterations, Improvements of Tenant's Property

 
Nothing herein contained shall oblige Landlord to repair or reconstruct any
Alterations, Improvements, or property of Tenant.
 
12.5
Where Tenant is at Fault

 
If any damage or destruction by fire or other cause to the Building or Premises,
whether partial or not, is due to the fault or neglect of Tenant, its officers,
agents, employees, servants, visitors or licensees, without prejudice to any
other rights and remedies of Landlord and without prejudice to the rights of
subrogation of Landlord's insurer:
 
(1)  
Tenant shall be liable for all costs and damages,

 
(2)  
the damages may be repaired by Landlord at Tenant's expense,

 
(3)  
Tenant shall forfeit its right to terminate this lease as provided in Article
12.1(1),

 
(4)  
Tenant shall forfeit any abatement of rent provided in this Article 12 and rent
shall not abate.

 
ARTICLE 13- NO RESPONSIBILITY OF LANDLORD
 
13.1     General Provisions
 
Save as set out in Article 12, there shall be no abatement from or reduction of
the rent due hereunder nor shall Tenant be entitled to damages, costs, losses or
disbursements from Landlord regardless of the cause or reason therefor (except
where such cause or reason is Landlord's direct fault or negligence) on account
of fire or other casualty. Neither shall there be any abatement or reduction of
rent, or recovery by Tenant from Landlord on account of partial or total failure
of, damage caused by, lessening of supply of, or stoppage of, heat,
air-conditioning, electric light, power, water, plumbing, sewage, elevators,
escalators or any other service, nor on account of any damage or annoyance
occasioned by water, snow, or ice being upon or coming through the roof,
skylight, trapdoors, windows, or otherwise, or by any defect or break in any
pipes, tanks, fixtures, or otherwise whereby steam, water, snow, smoke or gas,
leak, issue or flow into the Premises, nor on account of any damage or annoyance
occasioned by the condition or arrangements of any electric or other wiring, nor
on account of any damage or annoyance arising from any acts, omissions, or
negligence of co-tenants or other occupants of the Building, or of owners or
occupants of adjacent or contiguous property, nor on account of the making of
Alterations, repairs, Improvements, or structural changes to the Building, or
any thing or service therein or thereon or contiguous thereto provided the same
shall be made with reasonable expedition.
 
Without restricting the foregoing, Landlord shall not be liable for any other
damage to or loss, theft, or destruction of property, or death of, or injury to,
persons at any time in or on the Premises or in or about the Building, howsoever
occurring.
 
Notwithstanding the foregoing, liability of Landlord shall under no
circumstances extend to any property other than normal office furniture which
term, without limiting its normal meaning, shall not include securities, specie,
papers, typewriters, electric computers, or other machines or other similar
items.
 
 
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13.2
Delay in Completion of Premises

 
Landlord shall not be liable for any damages suffered by Tenant should any delay
in the completion of the Premises in any way delay or inconvenience the
occupation thereof or the enjoyment of the Building or accessories or services.
 
13.3
Tenant Indemnification

 
Tenant covenants and agrees that it will protect, save and keep Landlord
harmless and indemnified against any penalty or damage or charge imposed for any
violation of any laws or ordinances occasioned by Tenant or those connected with
Tenant, and that it will protect, indemnify, save and keep harmless Landlord
against any and all damage or expense arising out of any accident or other
occurrence on or about the Premises causing injury to any person or property
(except to the extent Landlord may be otherwise liable therefor), and against
any and all damage or expense arising out of any failure of Tenant in any
respect to comply with and perform all the requirements and provisions of this
lease.
 
13.4
Special Perm its

 
If any equipment, installation or apparatus to be used or installed by Tenant in
the Premises requires a permit from any governmental authority, Tenant agrees to
secure the required permit before installation at its expense and to file a copy
of such permit with Landlord.
 
ARTICLE 14- RIGHT OF ENTRY
 
14.1
General Provisions

 
Landlord may, at any time and without liability to Tenant, enter the Premises to
examine or to exhibit the same or to make Alterations and repairs, or for any
purpose which it may deem necessary for the operation or maintenance of the
Building or its equipment. During the last 9 months of the term of the lease or
of its renewal, Tenant shall allow such person or persons as may be desirous of
leasing the Premises to visit the same on business days between the hours of
9:00 a.m. and 5:00 p.m.
 
14.2
Alteration of Locks

 
Tenant shall install and maintain Landlord's building standard locking/keying
system in the Premises and shall not alter any locks on any doors of the
Premises without the prior written consent of Landlord. In no circumstances
shall the locks on any doors alter the building standard locking/keying system
to the intent that Landlord shall at all times have access to the Premises by
way of the building standard key.
 
ARTICLE 15- COMPLIANCE WITH LAW
 
15.1
General Provisions

 
Tenant shall promptly and at its expense execute and comply with all laws,
rules, orders, ordinances and regulations of the Municipal, Provincial and
Federal authorities and of any department or bureau of any of them, and of any
other governmental authority having jurisdiction over the Premises, Tenant's
occupancy of the Premises or Tenant's business conducted thereon.
 
ARTICLE 16- INSURANCE REQUIREMENTS
 
16.1
Landlord's Insurance

 
Landlord shall take out and keep in force throughout the term, upon such terms
and conditions and in such amounts as would be maintained by a prudent owner of
a property similar to the Building, the following insurance:
 
(1)  
public liability and property damage liability insurance with respect to the
Building;

 
(2)  
fire and standard extended perils or "all risks" coverage and boiler and
machinery insurance on all real and personal property owned by Landlord or for
which it is legally responsible comprising or located upon the Building; and

 
 
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(3)  
such other forms of insurance as Landlord or its mortgagee, debenture holder or
other secured creditor may from time to time consider advisable.

 
At the request of Tenant and at its expense, if any, Landlord will endeavour to
obtain a waiver of the insurer's right of subrogation as against Tenant under
the policies described in (2) above, provided that such waiver is obtainable by
Landlord from its insurers. Notwithstanding such a waiver and any of the other
provisions of this Article 16.1, Landlord shall retain all of its rights as
against Tenant arising out of loss or damage to property of Landlord up to a
limit of $250,000 or the Landlord's deductible, whichever is less in any one
occurrence.
 
For greater certainty, nothing herein shall be construed as requiring Landlord
to insure Improvements or any property owned or brought onto the Building by
Tenant whether affixed to the Building or not. Tenant acknowledges and agrees
that, notwithstanding that Tenant shall be contributing to the cost of
Landlord's insurance with respect to the Building, Tenant shall not have any
insurable interest in, or any right to recover any proceeds under any of
Landlord's policies.
 
16.2
Tenant not to Jeopardize Landlord's Insurance

 
Tenant shall neither do, permit nor omit to be done, anything in the Premises or
the Building which might result in any increase in the premiums for Landlord's
insurance coverage or which might result in actual or threatened reduction or
cancellation of or material adverse change in such coverage.
 
Tenant shall pay any such increases in premiums forthwith upon demand as
additional rent. In determining Tenants responsibility for any increased
premiums, a statement by the party establishing the relevant insurance rate
shall be conclusive evidence of the various components of such rate. If any
insurance coverage with respect to the Building or any part thereof is actually,
or threatened to be, either cancelled, reduced or materially adversely changed
by the insurer by reason of the condition, use or occupancy of the Premises or
any part thereof, or any act or omission of Tenant or any person for whom Tenant
is in law responsible, and if Tenant fails to remedy the condition, use,
occupancy, act or omission giving rise to such actual or threatened
cancellation, reduction or change within 10 days after notice thereof from
Landlord (or any shorter period which shall be 2 days less than the period
allowed to Landlord in the notice from Landlord's insurer), Landlord may at its
option either:
 
(1)  
re enter and take possession of the Premises forthwith by leaving upon the
Premises notice of its intention so to do and thereupon the provisions of this
lease respecting Landlord's remedies shall apply; or

 
(2)  
enter upon the Premises and remedy such condition, use, occupancy, act or
omission and Tenant shall on demand pay Landlord for the remedy as additional
rent. Tenant agrees that no such entry by Landlord shall be deemed re entry or a
breach of any covenant of quiet enjoyment contained in this lease.

 
Tenant agrees that Landlord shall not be liable for any damage to any property
located on the Premises as a result of any such entry or re-entry by Landlord.
 
I6.3
Tenants Insurance

 
16.3.1
Throughout the term, including renewal as applicable, and such other times as
Tenant occupies the Premises or any part thereof, Tenant shall, at its expense,
take out and keep in force the following insurance:

 

(1)  
"all risks" insurance upon property of every kind owned by Tenant, or for which
Tenant is legally liable, or installed by or on behalf of Tenant in the
Building, including, without limitation, all Alterations and Improvements, in an
amount of not less than the full replacement cost thereof without any deduction
for depreciation, which amount shall be conclusively determined by Landlord in
the event of any dispute with respect thereto. Such coverage shall insure
against fire and all other perils as are from time to time included in the
standard "all risks" coverage including, without limitation, sprinkler leakages
(where applicable), and earthquake, flood and collapse, and shall be subject to
a replacement cost endorsement and a stated amount co insurance clause. Loss
shall be payable to Tenant and Landlord as their interests may appear;

 
 
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(2)  
comprehensive general liability insurance including but not limited to
occurrence basis property damage, personal injury liability, blanket contractual
liability, liquor liability if Tenant has a liquor license, non owned automobile
liability and products and completed operations with respect to the Premises and
Tenant's use of the Building, coverage to include the activities conducted by
Tenant and any of its servants, agents, contractors, subcontractors and persons
for whom Tenant is in law responsible, in any part of the Building. Such
policies shall have inclusive limits of at least $5,000,000 for each occurrence
involving bodily injury, death or property damage, or such higher limits as
Landlord may reasonably require from time to time. Such policies shall also
include Tenant's legal liability insurance under an "all risks" form for the
whole replacement cost of the Premises, including loss of use thereof. Such
policies shall also contain cross liability and severability of interest
clauses, and Landlord shall be named as an additional insured as shall Tenant's
contractors and subcontractor, where applicable;

 
(3)  
business interruption insurance for a minimum period of 24 months in an amount
that will reimburse the Tenant for direct or indirect loss of earnings
attributable to all perils insured against in Articles 16.3.1(1) and
16.3.1(4)(b) or attributable to prevention of access to the Premises or Building
as a result of any such perils, including extra expense insurance if applicable;
and

 
(4)  
if applicable, any other form of insurance in such amounts and against such
risks as Landlord may reasonably require from time to time, including without
limitation the following insurance:

 
(a)  
plate glass insurance on all internal and external glass in or about the
Premises; and

 
(b)  
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 Improvements and Alterations and providing coverage with
respect to all objects introduced into the Building by or on behalf of Tenant
and containing a joint loss endorsement or agreement.

 
16.3.2
Each of Tenants insurance policies as aforesaid or any other policies which
Tenant may take out shall contain:

 

(1)  
a waiver of any subrogation rights which Tenants insurers would have against
Landlord or any person, firm or corporation for whom Landlord may in law or by
agreement be responsible or for whom Landlord may have agreed to obtain such a
waiver;

 
(2)  
a provision that Tenant's insurance policy shall be primary and shall not call
into contribution any other insurance available to Landlord;

 
(3)  
a waiver, as respects the interest of Landlord, of any provision in any tenants'
insurance policies with respect to any breach of any warranties,
representations, declarations or conditions contained in the said policies; and

 
(4)  
an undertaking by the insurers that no material change, cancellation or
termination of any policy will be made unless Landlord has received at least 30
days' prior written notice thereof, delivered in accordance with the provisions
of this lease.

 
 
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16.3.3
All policies shall be taken out with such insurers and shall be in such form as
are satisfactory from time to time to Landlord. Tenant shall deliver to Landlord
certificates of insurance in the form designated by Landlord within 30 days
after the placement or renewal of such insurance, and shall from time to time
furnish to Landlord upon demand similar certificates confirming the renewal or
continuation in force of Tenant's insurance.

 
16.3.4
Tenant hereby releases Landlord and its servants, agents, employees, contractors
and those for whom Landlord is in law responsible from all losses, damages and
claims of any kind in respect of which Tenant is required to maintain insurance
or is otherwise insured.

 
16.4
Landlord's Right to Place Tenant's Insurance

 
If Tenant at any time fails to take out and keep in place any insurance required
by or pursuant to this lease or to deliver to Landlord satisfactory proof of the
good standing of any such insurance, Landlord shall, without prejudice to any of
its other rights hereunder, have the right but not the obligation to effect such
insurance on behalf of Tenant, and the cost thereof together with all reasonable
expenses incurred by Landlord shall be paid by Tenant to Landlord upon demand as
additional rent.
 
ARTICLE 17- MORTGAGES AND SUBORDINATION
 
17.1
General Provisions

 
This lease and all rights of Tenant hereunder shall be subject and subordinate
at all times to any and all underlying leases, mortgages, hypothecs or deeds of
trust affecting the Building and/or the Land which have been executed or which
may at any time hereafter be executed, and any and all extensions and renewals
thereof and substitutions therefor. Tenant agrees to execute any instrument or
instruments which Landlord may deem necessary or desirable to evidence the
subordination of this lease to any or all such leases, mortgages, hypothecs or
deeds of trust.
 
17.2
Landlord's Default under any Underlying Lease, Mortgage, Hypothec or Deed

 
Tenant covenants and agrees that, if by reason of a default upon the part of
Landlord as lessee under any underlying lease in the performance of any of the
terms or provisions of such underlying lease or by reason of a default under any
mortgage, hypothec or deed of trust to which this lease is subject or
subordinate, Landlord's estate is terminated, it will attorn to the lessor under
such underlying lease or the acquirer of the Building pursuant to any action
taken under any such mortgage, hypothec or deed of trust, and will recognize
such lessor or such acquirer, as Tenant's Landlord under this lease.
 
Tenant waives the provisions of any statute or rule of law now or hereafter in
effect which may give or purport to give Tenant any right of election to
terminate this lease or to surrender possession of the Premises in the event any
such proceeding to terminate the underlying lease is brought by the lessor under
any such underlying lease or any such action is taken under any such mortgage,
hypothec or deed of trust and agrees this lease shall not be affected in any way
whatsoever by any such proceedings.
 
17.3
Request from Landlord to Tenant for Written Statement

 
Tenant agrees to execute and deliver, at any time and from time to time, upon
the request of Landlord or of the lessor under any such underlying lease, or of
the holder of any such mortgage, hypothec or deed of trust, any instrument which
may be necessary or appropriate to evidence such attornment.
 
Tenant will upon request of Landlord furnish to the lessor under any underlying
lease and/or to each creditor under a mortgage, hypothec or deed of trust a
written statement that this lease is in full force and effect and that Landlord
has complied with all its obligations under this lease and shall furnish any
other reasonable written statement, including current financial statements,
document or estoppel certificate requested by any such creditor.
 
 
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17.4
Certificate from Tenant

 
Tenant, at any time and from time to time, upon not less than 10 days prior
written notice from Landlord, will execute, acknowledge and deliver to Landlord
and, at Landlord's request, addressed to any prospective purchaser, ground or
underlying lessor or mortgagee of the Building, a certificate of Tenant stating:
 
(1)  
that Tenant has accepted the Premises, or, if Tenant has not done so, that
Tenant has not accepted the Premises and specifying the reasons therefor;

 

(2)  
the commencement and expiration dates of this lease;

 
(3)  
that this lease is unmodified and in full force and effect, or if there have
been modifications, that the same is in full force and effect as modified, and
stating the modifications;

 

(4)  
whether or not there are then existing any defences against the enforcement of
any of the obligations of Tenant under this lease and, if so, specifying the
same;

 

(5)  
whether or not there are then existing any defaults by Landlord in the
performance of its obligations under this lease, and, if so, specifying the
same;

 

(6)  
the dates, if any, to which the rent and other charges under this lease have
been paid; and

 

(7)  
any other information, including current financial statements, which may
reasonably be required by any such persons.

 

It is intended that any such certificate of Tenant delivered pursuant to this
Article 17.4 may be relied upon by any prospective purchaser, ground or
underlying lessor or mortgagee of the Building.
 
17.5
Assignment by Landlord

 
Landlord shall have the right to assign the lease or its right to rent and
additional rent to a lending institution as collateral security for a loan, and
in the event that such an assignment is given and executed by Landlord this
lease shall not be cancelled or modified for any reason whatsoever, except as
provided for, anticipated or permitted by the terms of this lease or by law
without the consent in writing of such lending institution. Tenant agrees that
it will, if and whenever required by Landlord, within 15 days of such written
request forwarded to Tenant by registered mail consent to and become a party to
any instrument or instruments permitting a mortgage, trust deed or charge to be
placed on the Building or Premises or any part thereof as security for any
indebtedness covered by the trust deed, mortgage or charge. Landlord is hereby
irrevocably appointed and constituted Tenant's representative for the purpose of
signing such document on behalf of Tenant.
 
ARTICLE 18- EXPROPRIATION
 
18.1
General Provisions

 
If the whole or any part of the Premises, or the whole of the Building, or so
much thereof as shall in the opinion of Landlord, render it commercially
undesirable to continue operation of the Building, be expropriated, condemned or
taken by any competent authority for any purpose whatsoever, Landlord shall have
the right, at its discretion, to terminate this lease upon notice in writing to
Tenant of at least 30 days. Tenant shall have no claim in damages or otherwise
against Landlord relating to or arising out of the expropriation or
condemnation, or arising out of the cancellation of this lease, nor shall
Landlord be obliged to contest any expropriation proceedings.
 
ARTICLE 19- WAIVER
 
19.1
General Provisions

 
Failure of Landlord to insist upon strict performance of any of the covenants or
conditions of this lease or to exercise any right or option herein contained
shall not be construed as a waiver or relinquishment of any such covenant,
condition, right or option, but the same shall remain in full force and effect.
Tenant undertakes and agrees, and any person claiming to be a subtenant or
assignee undertakes and agrees, that the acceptance by Landlord of any rent from
any person other than Tenant shall not be construed as a recognition of any
rights not herein expressly granted, or as a waiver of any of Landlord's rights,
or as an admission that such person is, or as a consent that such person shall
be deemed to be, a subtenant or assignee of this lease, irrespective of whether
Tenant or said person claims that such person is a subtenant or assignee of this
lease. Landlord may accept rent from any person occupying the Premises at any
time without in any way waiving any right under this lease.
 
 
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ARTICLE 20- NOTICES AND DEMANDS
 
20.1       By Landlord to Tenant
 
Any notice, demand or request required or contemplated by any provision of this
lease to be given by Landlord to Tenant shall be deemed to be duly given when
delivered personally on Tenant, or when left upon the Premises, or when mailed
by prepaid registered mail, addressed to Tenant at the Premises and, except in
the case of interruption of postal service, shall be deemed delivered on the
fifth day after mailing or the date of actual delivery.
 
20.2
Tenant's Domicile

 
Tenant elects domicile at the Premises for the purpose of service of all
notices, writs of summons or other legal documents in any suit at law, action or
proceeding which Landlord may take.
 
20.3
By Tenant to Landlord

 
Any notice, demand or request required or contemplated by any provision of this
lease to be given by Tenant to Landlord shall be duly given when personally
delivered or mailed by prepaid registered mail to Landlord at c/o GWL Realty
Advisors Inc., Suite 220, 1949 Upper Water Street, Halifax, Nova Scotia, B3J
3N3, Attention: Senior Property Manager; with a second copy to c/o GWL Realty
Advisors Inc., 2001 University Street, Suite 1820, Montreal, Quebec, H3A 2A6,
Attention: Vice President, Asset Management. Service of any such notice, demand
or request shall, except in the case of interruption of postal service, be
deemed complete on the fifth business day after mailing or the date of actual
delivery.
 
20.4
Prior to Commencement Date

 
Prior to the Commencement Date of this lease, any notice or demand shall be
deemed to be duly given by Landlord to Tenant when delivered personally to
Tenant, or when mailed to Tenant at its principal place of business in the City
of Halifax, or at its mailing address as made known by Tenant to Landlord.
 
ARTICLE 21- LANDLORD AND TENANT  21.1 Definition of Landlord
 
The term "Landlord", as used in this lease, means only the owner for the time
being of the Building or the lessee of a lease of the whole Building, so that in
the event of any sale or sales or transfer or transfers of the Building, or the
making of any lease or leases thereof, or the sale or sales or the transfer or
transfers or the assignment or assignments of any such lease or leases, Landlord
shall be and hereby is relieved of all covenants and obligations of Landlord
hereunder and it shall be deemed and construed without further agreement between
the parties, or their successors in interest, or between the parties and the
transferee or acquirer at any such sale, transfer or assignment, or lessee on
the making of any such lease, that the transferee, acquirer or lessee has
assumed and agreed to carry out any and all of the covenants and obligations of
Landlord hereunder to Landlord's exoneration, and Tenant shall thereafter be
bound to and shall attorn to such transferee, acquirer or lessee, as the case
may be, as Landlord under this lease.
 
21.2
Tenant Partnership

 
If Tenant shall be a partnership (hereafter referred to as the "Tenant
Partnership"), each person who is presently a member of Tenant Partnership, and
each person who becomes a member of any successor Tenant Partnership hereafter,
shall be and continue to be liable for the full and complete performance of, and
shall be and continue to be subject to, the terms and provisions of this lease,
whether or not he ceases to be a member of such Tenant Partnership or successor
Tenant Partnership.
 
 
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21.3
Relationship between Landlord and Tenant

 
It is understood and agreed that nothing contained in this lease nor in any acts
of the parties hereto shall be deemed to create any relationship between the
parties hereto other than the relationship of landlord and tenant.
 
ARTICLE 22- BROKERAGE COM MISSION
 
22.1
General Provisions

 
As part of the consideration for the granting of this lease, Tenant represents
and warrants to Landlord that no broker or agent (other than any broker or agent
authorized in writing by Landlord) negotiated or was instrumental in negotiating
or consummating this lease. Any broker or agent of Tenant shall be paid by
Tenant.
 
ARTICLE 23- SECURITY
 
23.1
To Secure Payment of Rent

 
Tenant covenants with Landlord to furnish the Premises with and maintain therein
a sufficient quantity of furniture, fixtures and other effects to secure the
payment of 6 months' rent.
 
ARTICLE 24- EXPIRATION OF THE TERM OF THE LEASE  24.1 Tenant's Notice to
Landlord
 
Tenant shall give Landlord 9 months' written notice prior to the date of
expiration of this lease of its intention to vacate the Premises, failing which
Landlord may at its option give written notice to Tenant within a period of not
less than 30 days before the date of expiration of this lease that this lease is
renewed for a further period of 12 months from the said date of expiration under
the same terms and conditions as herein set forth. If neither of the notices
hereinabove described is given the present lease shall terminate ipso facto and
without notice or demand on the date stated in Article 4.1 of this lease and any
continued occupation of the Premises by Tenant shall not have the effect of
extending the period or of renewing the present lease for any period of time,
the whole notwithstanding any provisions of law and Tenant shall be presumed to
occupy the Premises against the will of Landlord who shall thereupon be entitled
to make use of any and all remedies by law provided for the expulsion of Tenant
and for damages, provided, however, that Landlord shall have the right at its
option in the event of such continued occupation by Tenant to give to Tenant at
any time written notice that Tenant may continue to occupy the Premises under a
tenancy from month to month in consideration of a rental equal to that provided
in Article 5.1 hereof plus 50% thereof, payable monthly and in advance and
otherwise under the same terms and conditions as are herein set forth.
 
24.2
Tenant's Credit Rating

 
Landlord shall have the right at its sole option and discretion to refuse any
renewal of this lease where Tenant's credit rating is not at least as good at
the time of such renewal as it was at the commencement of the term of this
lease; the obligations to prove such credit rating to the entire satisfaction of
Landlord at either or both of such times, to be incumbent on Tenant.
 
ARTICLE 25- FORCE MAJEURE
 
25.1
General Provisions

 
If and to the extent that either Landlord or Tenant shall be unable to fulfill
or shall be delayed or restricted in the fulfillment of any obligation under
this lease, other than the payment by Tenant of any annual rent or additional
rent, by reason of unavailability of material, equipment, utilities, services or
labour required to enable it to fulfill such obligation or by reason of any
statutory or regulatory or other legal requirement, or by reason of it not being
able to obtain any permission or authority required pursuant to any applicable
law or by reason of any other such cause beyond its control and not the fault of
the party being delayed and not avoidable by the exercise of reasonable
foresight (excluding the inability to pay for the performance of such
obligation), then the party being delayed shall be entitled to extend the time
for fulfillment of such obligation by a time equal to the duration of such delay
or restriction, and the other party shall not be entitled to any compensation
for any loss, inconvenience, nuisance or discomfort occasioned thereby. The
party delayed will, however, use its best efforts to fulfill the obligation in
question as soon as is reasonably practicable by arranging an alternate method
of providing the work, services or materials being delayed subject, in the case
of performance by Tenant, to the approval of Landlord in its sole and absolute
discretion. In any event, the provisions of this Article 25.1 shall not apply to
permit any delay in any payment by Tenant of any annual rent or additional rent.
 
 
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ARTICLE 26- GOVERNING LAW
 
26.1
General Provisions

 
This lease shall be construed and governed by the laws of the Province of Nova
Scotia. Should any provisions of this lease and/or of its conditions be illegal
or not enforceable under the laws of such Province it or they shall be
considered severable and the lease and its conditions shall remain in force and
be binding upon the parties as though the said provision or provisions had never
been included.
 
ARTICLE 27- PRIOR AGREEMENTS
 
27.1
General Provisions

 
Tenant acknowledges that the execution of this lease shall constitute a
conclusive presumption that all agreements and representations of every kind
whatsoever, written or oral, previously entered into or made by the parties
hereto or their agents, shall be solely those set forth in this lease.
 
27.2
Amendments of Lease

 
This lease may not be amended save by written instrument duly executed by both
Landlord and Tenant and the acceptance by Landlord of any plan, drawing,
specification and/or notice and/or the consent of Landlord to any such plan,
drawing, specification and/or notice, shall not be deemed to be an amendment to
this lease without the express written undertaking and consent of Landlord that
such acceptance and/or consent is to constitute an amendment.
 
ARTICLE 28- RULES AND REGULATIONS 28.1 Acts to Injure Premises or Persons
 
Tenant shall not perform any acts or carry on any practices which may injure the
Premises or be a nuisance or menace to other tenants, or make or permit any
improper noises in the Building and shall forthwith upon request by Landlord
discontinue all acts or practices in violation of this clause and repair any
damage or injury to the Premises caused thereby.
 
28.2
Preservation of Good Order and Cleanliness

 
Tenant shall not cause unnecessary labour by reason of carelessness and
indifference to the preservation of good order and cleanliness in the Premises
and in the Building.
 
28.3
Animals

 
No animals shall be brought or kept in or about the Building. 28.4 Canvassing
 
Canvassing, soliciting and peddling in the Building is prohibited and Tenant
shall co-operate to prevent the same.
 
28.5
Sidewalks, Entries, Passages, Elevators, etc.

 
The sidewalks, entries, passages, elevators and staircases shall not be
obstructed or used by Tenant or its clerks, servants, agents, visitors or
licensees for any other purpose than ingress to and egress from the offices.
Nothing shall be thrown by Tenant, its clerks, servants, agents, visitors or
licensees, out of the windows or doors, or into the entries, passages, elevators
or staircases of the Building. Landlord reserves entire control of the
sidewalks, entries, elevators, staircases, corridors and passages which are not
expressly included within this lease, and shall have the right to make such
repairs, replacements, Alterations, additions, decorations and Improvements and
to place such signs and appliances therein, as it may deem advisable, provided
that ingress to and egress from the Premises is not unduly impaired thereby.
 
 
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28.6
Advertising

 
Landlord shall have the right to prohibit any advertising of or by Tenant, which
in its opinion, tends to impair the reputation of the Building or its
desirability as a building for offices or for financial, insurance and other
institutions and businesses of a like nature. Upon written notice from Landlord,
Tenant shall refrain from or discontinue such advertising.
 
28.7
Signs or Advertisements on the Building

 
No sign, advertisement or notice shall be inscribed, painted or affixed on any
part of the outside or inside of the Building, except on the directories and
doors of offices, and then only of such size, color and style as Landlord shall
determine and approve.
 
28.8
Selling Articles or Carrying on Business other than that specifically provided
for in Lease

 
Tenant shall not sell or permit the sale at retail, of newspapers, magazines,
periodicals, theatre tickets, or such articles as are customarily sold in
tobacco shops, soda fountains or lunch counters, or any other goods, wares or
merchandise whatsoever, in or from Premises. Tenant shall not carry on or permit
or allow any employee or other person to carry on the business of stenography,
typewriting or any similar business in or from the Premises for the service or
accommodation of the occupants of any other portion of the Building, or the
business of a public barber shop or a manicuring or chiropodist business, or any
business other than that specifically provided for in this lease.
 
28.9
Workmen for Repairs

 
The workmen of Landlord must be employed by Tenant at Tenant's expense for
lettering, interior moving and other similar work that may be done on the
Premises.
 
28.10
Care of Premises

 
Tenant shall not mark, paint, drill into or in any way deface the walls,
ceilings, partitions, floors, wood, stone or iron work, or any other
appurtenance to the Premises.
 
28.11
Window Shades

 
Tenant shall not install window shades of any color other than the typical
colors from time to time approved by Landlord. Tenant shall not install curtains
or venetian blinds without the approval of Landlord. Tenant shall submit plans
to Landlord for prior approval before installing curtains or blinds in the
Premises.
 
28.12
Washrooms

 
The water and wash closets and urinals shall not be used for any other purpose
than the purposes for which they were respectively constructed, and the expense
of any breakage, stoppage or damage resulting from a violation of this rule by
Tenant or its clerks, agents, servants, visitors or licensees, shall be borne by
Tenant.
 
28.13
Apparatus Requiring Permit

 
If any apparatus used or installed by Tenant requires a permit as a condition
for installation, Tenant must file such permit with Landlord.
 
28.14
Entering Building After Normal Office Hours

 
Landlord shall have the right to determine the business hours for the Premises.
Until such time as Landlord may determine to the contrary, such business hours
shall be between the hours of 7:00 a.m. and 6:00 p.m. on business days and
between the hours of 7:00 a.m. and 12:00 noon on Saturdays. All persons entering
and leaving the Building at any time other than within such business hours shall
register in the books kept by Landlord at or near the night entrance. Landlord
will have the right to prevent any person from entering or leaving the Building
except during such business hours unless provided with a key to the Premises to
which such person seeks entrance, or a pass issued and signed by Tenant upon the
letterhead of Tenant and countersigned by Landlord. Any persons found in the
Building at times other than such business hours without such keys or passes
will be subject to the surveillance of the employees and agents of Landlord.
This rule is made for the protection of Tenant, but Landlord shall be under no
responsibility for failure to enforce it.
 
 
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28.15
Safes and Heavy Equipment

 
Landlord shall have power to prescribe the weight and position of safes and
other heavy equipment, which shall be placed and stand on such plant strips or
skids as Landlord may prescribe, to distribute the weight properly. All damage
done to the Building by taking in or moving out a safe or any other article of
Tenant's equipment, or due to its being on the Premises, shall be repaired at
the expense of Tenant. The moving of safes shall occur only during such hours as
Landlord may from time to time establish and upon previous notice to Landlord,
and the persons employed to move the safes in and out of the Building must be
acceptable to Landlord. Safes will be moved through the halls and corridors only
upon steel bearing plates. No freight or bulky matter of any description will be
received into the Building or carried in the elevators, except during hours
approved by Landlord.
 
28.16
Rules and Regulations for Security of Building

 
Tenant agrees to observe all reasonable rules and regulations regarding the
security and protection of the Building and tenants thereof including without
limitation the right of Landlord to search the person of and/or any article
carried by any person entering or leaving the Building.
 
28.17
Further Rules and Regulations

 
Tenant covenants that the rules and regulations hereinabove stipulated, and such
other and further rules and regulations as Landlord may make and communicate to
Tenant, being in its judgment needful for the reputation, safety, care or
cleanliness of the Building and Premises, or the operation, maintenance or
protection of the Building and its equipment, or the comfort of the tenants,
shall be faithfully observed and performed by Tenant, and by its clerks,
servants, agents, visitors and licensees. Landlord shall have the right to
change said rules and to waive in writing, or otherwise, any or all of the said
rules in respect of any one or more tenants, and Landlord shall not be
responsible to Tenant for the non-observance or violation of any of said rules
and regulations by any other tenant or other person. The provisions of the rules
and regulations shall not be deemed to limit any covenant or provision of this
lease to be performed or fulfilled by Tenant.
 
28.18
Access to Loading Area

 
Landlord shall be entitled to control access to the truck loading area.
 
28.19
Keys

 
Landlord shall furnish Tenant, free of charge, with 2 keys for each corridor
door entering the Premises, and additional keys will be furnished at a charge by
Landlord equal to its cost, plus 15%, on an order signed by Tenant or Tenant's
authorized representative. All such keys shall remain the property of Landlord.
No additional locks shall be allowed on any door of the Premises without
Landlord's written permission, and Tenant shall not make or permit to be made
any duplicate keys, except those furnished by Landlord. Upon termination of this
lease, or any renewal thereof, Tenant shall surrender to Landlord all keys for
the Premises and give to Landlord the explanation of the combination of all
locks for safes, safe cabinets and vault doors, if any, in the Premises.
 
28.20
Graphics

 
Landlord shall provide and install, at Tenant's expense, all letters or numbers
on doors to the Premises; all such letters and numbers shall be in the building
standard graphics, and no others shall be used or permitted on the Premises. In
addition, Landlord shall maintain a directory board in the lobby of the Building
and provide reasonable identification of Tenant at Tenant's expense.

 
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28.21
Environmental

 
(1) 
Tenant agrees that all activities conducted on the Premises during the term of
this lease will comply with any and all laws, regulations and ordinances
relating to environmental matters and the protection of the environment or other
safety and health concerns including, without restriction, the storage,
handling, disposal, discharge and or removal of any hazardous, nuclear or toxic
waste, substance or material. Tenant agrees to indemnify and hold Landlord
harmless from and against any loss, cost, damage or expense arising out of or
attributable to the failure of Tenant to comply with its obligations under this
Article 28.21.

 
(2)  
Landlord will have the right to inspect the Premises at all reasonable times to
determine Tenant's compliance with its obligations under this Article 28.21 and
if Tenant fails to meet any of its obligations hereunder Landlord may perform,
at Tenant's expense, any lawful actions necessary to redress such default.

 

(3)  
If, on termination of this lease Tenant is in default of any of its obligations
under this Article 28.21 Landlord may, at its option, extend the term of this
lease for such period of time as may be reasonable to cure such default, in
which event this lease shall remain in full force and effect until such default
has been cured.

 

(4)  
If Tenant's business includes in any way the storage, handling, disposal,
discharge and/or removal of any hazardous, nuclear or toxic waste, substance or
material, Tenant's liability insurance as provided for in Article 16.3 shall
specifically insure against its obligations under this Article 28.21.

 

(5)  
Tenant covenants and agrees with the Landlord that the Tenant shall at all
times, at its own expense, operate, use and maintain the Premises and cause the
Premises to be operated, used and maintained by all persons in strict compliance
with all applicable Federal, Provincial, Municipal and local laws, statutes,
ordinances, by­laws and regulations and all orders, directives and decisions
rendered by, and policies, guidelines and similar guidance of, any ministry,
department or administrative or regulatory agencies, authority, tribunal or
court, relating to the protection of the environment, human health and safety or
the use, treatment, storage, presence, disposal, packaging, recycling, handling,
clean-up or other remediation or corrective action of or in respect of any
Hazardous Substance. For the purposes of this Lease, "Hazardous Substance"
means, as defined by environmental laws, any pollutant, contaminant, chemical,
waste (including, without limitation, solvent waste, liquid industrial waste,
other industrial waste, toxic waste and hazardous waste) or deleterious
substance, but excluding hazardous building materials defined and regulated as
Designated Substances. For the purposes of this Lease, "Designated Substances"
means a biological, chemical or physical agent or combination thereof prescribed
as a designated substance to which the exposure of a worker is prohibited,
regulated, restricted, limited or controlled.

 

(6)  
Except as clearly permitted under environmental laws, the Tenant will not bring
or permit to be brought on or into the Premises, the Building or any part
thereof, or discharge or release or permit to be discharged or released, any
Hazardous Substance. If required by the Landlord, the transportation and removal
of any Hazardous Substances in conformance with the provisions of this Article
28.21 shall be performed by the Landlord for and on behalf of the Tenant, and
Tenant shall pay all cost relating to same.

 

(7)  
The Tenant will indemnify the Landlord and those for whom it is in law
responsible and save them harmless from every loss, cost, claim, expense, fine,
penalty, prosecution or alleged infraction which they, or any of them, suffer or
suffers as a result of the Tenant's breach of any of its obligations under this
Article 28.21. In addition, the Tenant will pay to the Landlord, immediately
upon demand, all costs incurred by the Landlord in doing any clean-up,
restoration or other remedial work as a consequence of the Tenant's failure to
comply with any of its obligations under this Article 28.21, plus a 15%
administration fee.

 
 
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ARTICLE 29- DEFAULT BY TENANT
 
29.1
Events of Default

 
29.1.1
The following are events of default hereunder:

 
(1)  
if and whenever the annual rent or additional rent hereby reserved, or other
monies payable by Tenant, or any part thereof, shall not be paid on the day
appointed for payment thereof and if such non-payment continues for 5 days after
written notice thereof to Tenant by Landlord;

 
(2)  
in case of default, breach or non-performance of any of the covenants or
agreements or rules or regulations herein contained on the part of Tenant and if
such default continues for 15 days after written notice thereof to Tenant by
Landlord and Tenant shall not have remedied same or if such default would take
more time than 15 days to remedy and Tenant has commenced to cure such default
within such 15 day cure period then the cure period shall be extended for so
long as is necessary to cure such default provided that Tenant continues to
diligently pursue the remedying of such default;

 
(3)  
in case of the seizure or forfeiture of the term, or any renewal or overholding
portion thereof;

 
(4)  
if Tenant shall attempt or threaten to move its goods, chattels or equipment out
of the Premises other than as allowed under this lease;

 
(5)  
if a receiver shall be appointed for the business, property, affairs or revenues
of Tenant or a part thereof;

 
(6)  
if Tenant shall be adjudicated a bankrupt or make any general assignment for the
benefit of creditors or take or attempt to take the benefit of any insolvency or
bankruptcy legislation;

 
(7)  
save where otherwise permitted hereunder if any person other than Tenant has or
exercises the right to manage or control the Premises, any part thereof, or any
of the business carried on therein other than subject to the direct and full
supervision and control of Tenant;

 
(8)  
if, without the prior written consent of Landlord not to be unreasonably
withheld, effective control of Tenant is acquired or exercised by any person or
persons not having effective control of Tenant at the date of this lease other
than as herein expressly permitted.

 
29.1.2
Then and in any of such events of default, the then current and the next 3
months' annual rent and additional rent shall be forthwith due and payable and
Landlord shall have the following rights and remedies, all of which are
cumulative and not alternative, to:

 
(1)  
terminate this lease in respect of the whole or any part of the Premises by
written notice to Tenant; if this lease is terminated in respect of part of the
Premises, this lease shall be deemed to be amended by the appropriate
amendments, and proportionate adjustments in respect of annual rent and
additional rent and any other appropriate adjustments shall be made;

 
(2)  
itself, or by its agent or employees, or by a receiver or replacement thereof
appointed in writing by Landlord enter the Premises as agent of Tenant and as
such agent to relet the Premises for whatever term (which may be for a term
extending beyond the then term hereof) and on whatever terms and conditions as
Landlord in its sole discretion may determine and to receive the rent therefor
and, as the agent of Tenant, to take possession of any furniture, fixtures,
equipment, stock or other property thereon and, upon giving written notice to
Tenant, to store the same at the expense and risk of Tenant or to sell or
otherwise dispose of the same at public or private sale without further notice,
and to make such Alterations to the Premises in order to facilitate their
reletting as Landlord shall determine, and to apply the net proceeds of the sale
of any furniture, fixtures, equipment, stock or other property or from the
reletting of the Premises, less all expenses incurred by Landlord in making the
Premises ready for reletting and in reletting the Premises, on account of the
Rent due and to become due under this lease and Tenant shall be liable to
Landlord for any deficiency and for all such expenses incurred by Landlord as
aforesaid; no such entry or taking possession of or performing alteration to or
reletting of the Premises by Landlord shall be construed as an election on
Landlord's part to terminate this lease unless a notice of such intention or
termination is given by Landlord to Tenant;

 
 
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(3)  
remedy or attempt to remedy any default of Tenant in performing any repairs,
work or other covenants of Tenant hereunder and, in so doing, to make any
payments due or claimed to be due by Tenant to third parties and to enter upon
the Premises, without any liability to Tenant therefor or for any damages
resulting thereby, and without constituting a re entry of the Premises or
termination of this lease, and without being in breach of any of Landlord's
covenants hereunder and without thereby being deemed to infringe upon any of
Tenant's rights pursuant hereto, and, in such case, Tenant shall pay to Landlord
forthwith upon demand all amounts paid by Landlord to third parties in respect
of such default and all reasonable costs of Landlord in remedying or attempting
to remedy any such default as additional rent;

 
(4)  
take possession of the Premises and all contents thereof itself or by a receiver
or any replacement thereof appointed by Landlord in writing and carry on the
business on the Premises and sell this lease or sub let the Premises and sell
the contents of the Premises in such manner as may seem advisable to Landlord or
the receiver or any replacement thereof, all in the name of Tenant;

 
(5)  
obtain damages from Tenant including, without limitation, if this lease is
terminated by Landlord, all deficiencies between all amounts which would have
been payable by Tenant for what would have been the balance of the term but for
such termination, and all net amounts actually received by Landlord for such
period of time; and

 
(6)  
suspend or cease to supply any utilities, services, heating, ventilating, air
conditioning and humidity control to the Premises, all without liability of
Landlord for any damages, including indirect or consequential damages, caused
thereby.

 
29.2
The Exercise of any Right of Landlord

 
The exercise by Landlord of any right it may have hereunder or by law shall not
preclude the exercise by Landlord of any other right it may have hereunder or by
law.
 
29.3
No Waiver by Landlord

 
Failure of Landlord to insist upon the performance of any covenant or condition
of this lease or to exercise any right or option contained in this lease shall
not be construed as a waiver or relinquishment of any such covenant, condition,
right or option. No variation of any covenant or condition of this lease shall
be valid unless in writing and signed by duly authorized persons on behalf of
Landlord. The acceptance of rent from or the performance of any obligation by a
person other than Tenant shall not be construed as an admission by Landlord of
any right, title or interest of such person as sub-tenant, assignee, transferee
or otherwise in the place of Tenant.
 
29.4
Landlord's Right to Enter Premises

 
Tenant further covenants and agrees that, on Landlord becoming entitled to
re-enter upon the Premises under any of the provisions in this lease, Landlord,
in addition to all other rights, shall have the right to enter the Premises as
agent of Tenant, either by force or otherwise, without being liable for damages
or loss therefor and to relet the Premises as the agent of Tenant, and to
receive the rent therefor and, as the agent of Tenant, to take possession of any
furniture or other property on the Premises and to sell the same at public or
private sale without notice and to apply the proceeds of such sale and any rent
derived from reletting the Premises upon account of the rent under this lease
and Tenant shall be liable to Landlord for the deficiency, if any.
 
 
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29.5
No Limitation on Right to Distrain

 
Tenant waives and renounces the benefit of any present or future statute taking
away or limiting Landlord's right of distress and covenants and agrees that
notwithstanding any such statute none of the goods and chattels of Tenant on the
Premises at any time during the term shall be exempt from levy by distress for
rent or any other charges; all goods and chattels brought by Tenant onto the
Premises shall be the unencumbered property of Tenant and they shall not be
subjected to any claim or other encumbrance at any time without the written
consent of Landlord. If Tenant shall leave the Premises leaving any rent or
other amounts owing under this lease unpaid, Landlord, in addition to any other
available remedy, may seize and sell the goods and chattels of Tenant at any
place to which Tenant or other person may have removed them in the same manner
as if such goods and chattels had rem ained and been distrained upon the
Premises.
 
ARTICLE 30- MISCELLANEOUS
 
30.1       Captions
 
The captions and headings appearing in this lease have been inserted as a matter
of convenience and for reference only and, in no way define, limit or enlarge
the scope or meaning of this lease, nor of any provision hereof.
 
30.2
No Registration

 
Tenant covenants that it will not register this lease or any notice thereof
except in a form which shall be acceptable to Landlord.
 
30.3
Tenant's Acceptance of Lease

 
Tenant hereby accepts this lease of the above described Premises to be held by
it as Tenant subject to the covenants, conditions and restrictions above and in
the Schedules attached hereto set forth.
 
30.4
Acknowledgement of Authority

 
GWL Realty Advisors Inc. ("GWL") has executed this Lease as the agent for the
Landlord. The covenants and agreements hereunder are the obligations of the
Landlord only and are not obligations personal to or enforceable against GWL.
 
30.5
Successors and Assigns

 
AND IT IS AGREED, that the provisions hereof shall be binding upon and enure to
the benefit of the successors, legal representatives and assigns of the parties,
except as may be hereinabove otherwise provided, and if there is more than one
tenant, the covenants herein contained on the part of Tenant shall be construed
as being several as well as joint, and where necessary, the singular number
shall be taken to include the plural, and the neuter, the masculine and/or the
feminine gender.
 
 
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ARTICLE 31— SPECIAL CLAUSES
 
31.1
Condition of Premises

 
Notwithstanding anything herein to the contrary, Tenant will take possession of
the Premises in their present as is" condition. Tenant shall be responsible at
its own expense for any modifications or renovations within the Premises,
subject to the prior approval of the Landlord and the general procedures
outlined herein.
 
31.2
Fixturing Period

 
The Tenant will be given access to the Premises for the purpose of construction
of its leasehold improvements and fixturing the Premises by no later than June
15, 2012, provided the Lease has been fully executed by both the Tenant and
Landlord and Tenant has obtained Landlord's approval of Tenant's architectural,
structural, mechanical and electrical plans and specifications, to the earlier
of the day immediately preceding the Commencement Date (the "Fixturing Period").
The Tenant's occupation of the Premises during the Fixturing Period will be
governed by all terms and conditions of the Lease, save and except that the
Tenant will not be responsible for the payment of Basic Rent, but will be
responsible for Additional Rent and Realty Taxes and will reimburse the Landlord
for its utilities and any other services provided by the Landlord.
 
31.3
Extension of Term

 
If Tenant is Cranium Technologies Ltd. or a Permitted Transferee, and is itself
in occupation of the whole of the Premises throughout the Term in accordance
with the Lease and if Tenant is not in default and has not been in default
during the Term, and Tenant has delivered a written Notice to Landlord not more
than twelve (12) months and not less than nine (9) months before the expiration
of the Term that Tenant wishes to extend the Term, then Landlord shall extend
the Term of the Lease for the entire Premises at the expiration of the Term for
a period of two (2) years (the "Extended Term"). The Basic Rent rate for the
Extended Term shall be the Fair Market Rent (as defined in the following
sentence). "Fair Market Rent" shall be the prevailing net rental rate being
quoted at the applicable time, for premises for tenants with comparable
financial covenants in comparable buildings in an "A" Class building in the
financial core in Downtown Halifax, which premises are comparable with respect
to size, location, term and leasehold improvements. In no event, however, shall
such rate be less than the Basic Rent payable during the 12 month period
immediately preceding the commencement of the Extended Term. All other terms and
conditions of the Lease will apply to the Extended Term, except that there will
be no leasehold improvement allowance, no free rent, no Landlord's work and no
further right to extend the Term. If the parties are unable to agree on the
Basic Rent to be paid during the Extended Term within 60 days of the date of the
Tenant's Notice, then this right to Extend the Term and the Extended Term shall
be null and void and neither party shall have any rights or obligations towards
the other arising therefrom. If the parties are able to agree upon a Basic Rent
rate within such 60 day period, then Tenant shall sign Landlord's then current
standard form of net lease for the Building to document the Extended Term or, at
Landlord's option, a Lease Extension and Amending Agreement prepared by Landlord
to reflect the terms of the Extended Term. It is understood and agreed that
Tenant, in exercising this right, shall be deemed to be exercising a right to
extend the Term for all space which Tenant is occupying in the Building.
 
 
31.4
Parking

 
Landlord shall, throughout the Term of the Lease, provide Tenant with four (4)
permits for unreserved parking in the Building's parking facility, at Landlord's
prevailing rate for parking from time to time, which at the commencement of the
Term is $145.00 per permit per month, plus HST. Tenant must accept from Landlord
all the permits to which it is entitled on the Commencement Date or forfeit the
number it has elected not to take. Tenant acknowledges and agrees that this is a
contractual right only and does not form part of the Premises demised to Tenant
and no landlord and tenant relationship exists with respect to this parking
right, but the obligations shall be binding upon successors and assigns of
Landlord's interest in the Building. Tenant agrees to sign, on Landlord's
request, Landlord's standard form of parking license agreement for the
Building's parking facility.
 
 
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31.5
Deposit

 
Upon execution of this Lease, the Tenant will deliver a cheque in the amount of
$111,046.94, plus applicable H.S.T., payable to "GWL Realty Advisors Inc., In
Trust." The monies shall be deposited into a non-interest bearing account and
shall be applied against the first six (6), the thirteenth (13), fourteenth
(I4), and fifteenth (15) months' (being July, August and September 2013) and the
thirty-fourth (34), thirty-fifth (35) and thirty-sixth (36) months' (being
April, May and June 2015) Rent due. If Tenant defaults in the payment of Rent at
any time during the Term, Landlord may apply the amount of such deposit then
remaining to the amount of Rent then unpaid. Upon so doing, Landlord will advise
Tenant and Tenant will forthwith replenish the deposit.
 
31.6
Environmental Assessment

 
Tenant shall complete the Landlord's standard Environmental Assessment Form,
attached hereto as Schedule "E".
 
 
(Signature Page Follows)
 
 
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IN WITNESS WHEREOF, Landlord and Tenant have duly executed and signed these
presents as of the day and year first above written.
 

   
GWL Realty Advisors Inc. as agents for and on
behalf of PSS INVESTMENTS I INC.
           
 
  Per:  /s/ Don Harrison        
Don Harrison, Senior Vice President, Asset Management
                Per: /s/ Pascale Roy        
Pascale Roy, Vice President, Asset Management, Eastern Region
               
I/We have the authority to bind the corporation
               
GWL Realty Advisors Inc. as agents for and on
behalf of TPP INVESTMENTS I INC.
               
Per:
/s/ Don Harrison         Don Harrison, Senior Vice President, Asset Management  
             
Per:
/s/ Pascale Roy        
Pascale Roy, Vice President, Asset Management, Eastern Region
               
I/We have the authority to bind the corporation
               
THE GREAT-WEST LIFE ASSURANCE COMPANY
               
Per:
/s/ Don Harrison         Don Harrison, Senior Vice President, Asset Management  
             
Per:
/s/ Pascale Roy        
Pascale Roy, Vice President, Asset Management, Eastern Region
                I/We have the authority to bind the corporation                
LONDON LIFE INSURANCE COMPANY                 Per: /s/ Don Harrison        
Don Harrison, Senior Vice President, Asset Management
                Per: /s/ Pascale Roy        
Pascale Roy, Vice President, Asset Management, Eastern Region
                I/We have the authority to bind the corporation                
CRANIUM TECHNOLOGIES LTD.             /s/ K Hunter   Per: /s/ Daniel Hunter   
Witness   Name: DANIEL HUNTER         Title: COO, DIRECTOR                 Per:
    Witness   Name:         Title:                   I/We have the authority to
bind the corporation  

 
Cranium Technologies Ltd.'s HST Registration Number: 82980  0317  RT  0001
 
 
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SCHEDULE "A"
 
BLOCK lA
 
ALL that certain block of land and land covered by water on the northeastern
side of Upper Water Street in the Halifax Regional Municipality, Province of
Nova Scotia shown as Block-IA on a plan (Servant, Dunbrack, McKenzie & MacDonald
Limited Plan Number 14-309-0) of survey of Blocks IA, 2A, 4A, and 5,
Resubdivision of Blocks 1, 2 and 4 and Lot P, Lands and Lands Covered by Water
Conveyed to Purdy's Wharf Development Limited, City of Halifax and The
Great-West Life Assurance Company signed by Terrance R. Doogue, N.S.L.S. dated
April 27th, 1987 and described as follows:
 
BEGINNING on the northeastern official street line of Upper Water Street at a
point distant 1,211.55 feet on a bearing N 19° 16' 15" W from Nova Scotia
Coordinate Monument Number 4819;
 
THENCE N 49° 46' 23" W, 109.26 feet along the northeastern official street line
of Upper Water Street to a southern corner of Block-2A;
 
THENCE N 43° 07' 13" E, 190.36 feet along a southeastern boundary of Block-2A to
an eastern corner thereof;
 
THENCE N 46° 52' 47" W, 83.33 feet along a northeastern boundary of Block-2A to
an angle therein;
 
THENCE N 43° 07' 13" E, 130.44 feet along a southeastern boundary of Block-2A to
an angle therein;
 
THENCE N 88° 07' 13" E, 52.84 feet along a southern boundary of Block-2A to an
angle therein;
 
THENCE S 46° 52' 47" E, 137.21 feet along a southwestern boundary of Block-2A to
its intersection with the northwestern boundary of Block S;
 
THENCE S 48° 14' 10" W, 109.76 feet along the northwestern boundary of Block S
to an angle therein;
 
THENCE S 41° 42' 49" E, 49.46 feet along the southwestern boundary of Block S to
an angle therein;
 
THENCE S 48° 17' 06" W, 239.85 feet along the northwestern boundary of Block S
to the place of beginning.
 
CONTAINING 52,142 square feet.
 
ALL bearings are Nova Scotia Coordinate Survey System Grid Bearings and are
referred to Central Meridian, 64° 30' West.
 
A southeastern portion of the above described Lot IA as shown on the above
referred to plan being subject to View Plane No. 2 restrictions, as defined by
the Zoning By-Law of the Halifax Regional Municipality.
 
SUBJECT also to Easement P lying across the southern portion of the above
described Block IA as shown and mathematically delineated on the above referred
to plan and containing an area of 1,119 square feet. Said Easement P being the
subject of an Agreement recorded at the Registry of Deeds Office for the County
of Halifax in Book 4043 at Page 151.
 
EXCEPTING and reserving out of the foregoing Block IA that portion thereof
described as Parcel C and more particularly described as follows:
 
ALL that certain parcel of land on the northeastern side of Upper Water Street
in the Halifax Regional Municipality, Province of Nova Scotia shown as Parcel-C
on a plan (Servant, Dunbrack, McKenzie & MacDonald Ltd. Plan No. 14-453-0) of
survey of Blocks 2B and 2C and Parcels- A, B, and C, Subdivision of Block 2A,
and Portions of Blocks IA & 3, Lands Conveyed to The Great-West Life Assurance
Company and 123715 Canada Limited signed by Terrance R. Doogue, N.S.L.S. dated
September 1st, 1989 and described as follows.
 
 
 

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BEGINNING on the northeastern official street line of Upper Water Street at a
southern corner of Parcel-B;
 
THENCE N 43° 07' 13" E, 10.00 feet along the southeastern boundary of Parcel-B
to a western corner of Remaining Portion of Block-1A lands as conveyed to The
Great-West Life Assurance Company and 123715 Canada Limited by Indenture
recorded at the Registry of Deeds for the County of Halifax in Book 3706 at Page
762 (Portion thereof);
 
THENCE S 03° 19' 50" E, 13.78 feet along the western boundary of Remaining
Portion of Block-1A to its intersection with the northeastern boundary of Upper
Water Street;
 
THENCE N 49° 46' 23" W, 10.00 feet along the northeastern boundary of Upper
Water Street to the place of beginning.
 
CONTAINING 50 square feet.
 
ALL bearings Nova Scotia Coordinate Survey System Grid Bearings and are referred
to Central Meridian, 64° 30' West.
 
THE above described Parcel-C being part of Block IA as shown on the above
referred to plan.
 
BLOCK 3 AND SPATIAL ELEMENT SE-3A
 
All that certain block of land on the northeastern side of a Service Road of the
Cogswell Street Interchange in the Halifax Regional Municipality, Province of
Nova Scotia, shown as Block 3 on a plan (Servant, Dunbrack, McKenzie & MacDonald
Limited Plan Number 12-131-A) of survey of Blocks 1 to 4 inclusive, Lot C-1 and
Parcel S Lands and Lands Covered by Water, Acquired by Purdy Brothers Limited
and City of Halifax, signed by Roy A. Dunbrack, N.S.L.S. dated November 10, 1982
and described as follows:
 
BEGINNING on the official city street line (confirmed by City Council October
14, 1982) of the Service Road at the most southern corner of Lot C-1;
 
THENCE N 43° 07' 13" E, 300.72 feet along the southeastern boundary of Lot C-1
to the most western corner of Block 4;
 
THENCE S 46° 52' 47" E, 158.0 feet along the southwestern boundary of Block 4 to
an angle therein;
 
THENCE S 01° 52' 47" E, 35.83 feet along the western boundary of Block 4 to a
northwestern boundary of Block 2;
 
THENCE S 43° 07' 13" W, 295.24 feet along said boundary of Block 2 to the curved
official city street line (confirmed by City Council October 14, 1982) of the
Service Road;
 
THENCE northwesterly on a curve to the right which has a radius of 1,189.77 feet
for a distance of 88.45 feet along said official city street line to a point of
curvature thereon;
 
THENCE N 39° 40' 45" W, 96.01 feet along the aforementioned official city street
line to the place of beginning.
 
CONTAINING a total area of 56,837 square feet, comprised of 37,657 square feet
more or less of land area and 19,180 square feet more or less of land covered by
water.
 
ALL bearings are Nova Scotia Coordinate Survey System Grid Bearings and are
referred to Central Meridian, 64° 30' West.
 
ALL that certain volume of space, overlying Block 3, on the northeastern side of
a Service Road of Cogswell Street Interchange in the Halifax Regional
Municipality, Province of Nova Scotia, designated as Spatial Element SE-3A. Said
Spatial Element SE-3A being bounded, by horizontal planes having geodetic
elevations of 146.50 feet and 196.50 feet and by vertical planes which are
coincident with the boundaries of Block 3 as said Block 3 is shown on a plan
(Servant, Dunbrack, McKenzie & MacDonald Limited Plan Number 12-131-A) of survey
of Blocks 1 to 4 inclusive, Lot C-1 and Parcel S Lands and Lands Covered by
Water, Acquired by Purdy Brothers Limited and City of Halifax, signed by Roy A.
Dunbrack, N.S.L.S. dated November 10,1982 and described as follows:
 
 
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BEGINNING on the official city street line (confirmed by City Council October
14, 1982) of the Service Road at the most southern corner of Lot C-1;
 
THENCE N 43° 07' 13" E, 300.72 feet along the southeastern boundary of Lot C-1
to the most western corner of Block 4;
 
THENCE S 46° 52' 47" E, 158.0 feet along the southwestern boundary of Block 4 to
an angle therein;
 
THENCE S 01° 52' 47" E, 35.83 feet along the western boundary of Block 4 to a
northwestern boundary of Block 2;
 
THENCE S 43° 07' 13" W, 295.24 feet along said boundary of Block 2 to the curved
official city street line (confirmed by City Council October 14, 1982) of the
Service Road;
 
THENCE northwesterly on a curve to the right which has a radius of 1,189.77 feet
for a distance of 88.45 feet along said official city street line to a point of
curvature thereon;
 
THENCE N 39° 40' 45" W, 96.01 feet along the aforementioned official city street
line to the place of beginning.
 
SAID Block 3 containing a total area of 56,837 square feet, comprised of 37,657
square feet more or less of land area and 19,180 square feet more or less of
land covered by water.
 
ALL bearings are Nova Scotia Coordinate Survey System Grid Bearings and are
referred to Central Meridian, 64° 30' West.
 
ALL elevations are geodetic elevations plus 100 feet, derived from monuments of
Nova Scotia Coordinate Survey System.
 
EXCEPTING and reserving out of the foregoing Block 3 and Spatial Element SE-3A
that portion thereof described as Parcel A and more particularly described as
follows:
 
ALL that certain parcel of land on the northeastern side of Upper Water Street
in the Halifax Regional Municipality, Province of Nova Scotia shown as Parcel-A
on a plan (Servant, Dunbrack, McKenzie & MacDonald Ltd. Plan No. 14-453-0) of
survey of Blocks 2B and 2C and Parcels-A, B, and C, Subdivision of Block 2A and
Portions of Blocks IA & 3, Lands Conveyed to The Great-West Life Assurance
Company and 123715 Canada Limited signed by Terrance R. Doogue, N.S.L.S. dated
September 1st, 1989 and described as follows:
 
BEGINNING on the curved northeastern official street line of Upper Water Street
at a western corner of Parcel-B lands as conveyed to The Great-West Life
Assurance Company by Indenture recorded at the Registry of Deeds for the County
of Halifax in Book 3833 at Page 621;
 
THENCE northwesterly on a curve to the right which has a radius of 1,189.77 feet
for a distance of 10.00 feet along the curved northeastern official street line
of Upper Water Street to the southern corner Remaining Portion of Block-3 lands
as conveyed to The Great-West Life Assurance Company by Indenture recorded at
the Registry of Deeds for the County of Halifax in Book 3833 at Page 621;
 
THENCE N 89° 42' 40" E, 13.74 feet along the southern boundary of Remaining
Portion of Block-3 to its intersection with the northwestern boundary of the
aforementioned Parcel-B;
 
THENCE S 43° 07' 13" W, 10.00 feet along the northwestern boundary of Block-B to
the place of beginning.
 
CONTAINING 50 square feet.
 
ALL bearings are Nova Scotia Coordinate Survey System Grid Bearings and are
referred to Central Meridian, 64° 30' West.
 
THE above described Parcel-A being part of Block 3 and Spatial Element SE-3A as
shown on the above referred to plan.
 
 
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SCHEDULE "C"
 
The method of measuring office building rentable area shall be that developed by
the Building Owners and Managers Association International and published in
their booklet "Standard Method For Measuring Floor Area in Office Building"
reprinted May 1981 and reaffirmed in 1989.
 
Rentable area is a measure of the tenants pro rata portion of the entire office
floor, excluding elements of the building that penetrate the floor to area
below. The rentable area of a floor is fixed for the life of the building and is
not affected by changes in corridor sizes or configurations.
 
The rentable area of a floor is computed by measuring to the inside finished
surface of the dominant portion of the permanent outer building walls excluding
any major penetrations of the floor. No deductions are made for columns and
projections necessary to the building. Dominant portion means that portion of
the inside finished surface of the permanent outer building wall which is 50% or
more of the vertical floor-to-ceiling dimension measured at the dominant
portion. If the dominant portion is not vertical, the measurement for area shall
be to the inside surface of the permanent outer building wall where it
intersects the finished floor. In the subject building the dominant portion is
the inside surface of the exterior windows.
 
PROPORTION FORMULA
 

 
A = net rentable area of tenant
             
B = net rentable area of Tower 1
       and 1949 Upper Water Street
              Proportion is               A        
                                 95% of B
   

 
 
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SCHEDULE "D"
BUILDING STANDARD INSTALLATION SCHEDULE
 
1.
LIGHTING

 
One 20" x 60" recessed fluorescent light fixture is provided at as per an 8 foot
centre line spacing located on a standard ceiling grid. Any installation of
light fixtures shall be at Tenant's expense.
 
2.
HEATING AND AIR-CONDITIONING SERVICES

 
Each floor is air-conditioned by a separate recirculation type variable air
volume unit located in the core area. The air is introduced through lighting
troffers. Perimeter and interior areas are divided into zones, each with
automatic controls.
 
The perimeter of each floor is heated by hot water radiation, with continuous
cabinets. One thermostat is provided on average for each bay to automatically
control perimeter space conditions. Interior space is provided with one
thermostat for each 2,000 square feet of area to control the variable air volume
boxes and maintain proper temperature.
 
The installation of interior heating, ventilation and air-conditioning services
and any relocation of exterior wall heating, ventilation and air- conditioning
services to accommodate Tenant's partition requirements or any special
requirement such as exhaust for printing machines, air circulation for
boardrooms, computer rooms, or reception areas shall be at Tenant's expense.
 
3.
SPRINKLER SYSTEM

 
The building is fully sprinklered according to standards of the Nova Scotia Fire
Marshall and the Fire Department of the Halifax Regional Municipality. Should
changes be required to the Building Standard system due to the Tenant's
partition layout, then the charges and/or additional sprinklers shall be at the
Tenant's expense.
 
4.
ELECTRICAL SERVICE

 
Electrical power is provided for Tenant's electrical service requirements at
junction boxes within the suspended ceiling on each floor
 
5.
TELEPHONE SERVICE

 
Conduit to receive telephone circuits will be provided from each bay to the
central core of each floor.
 
6.
TOILET ROOMS

 
One Men's and one Women's toilet room are provided on each floor, fully
furnished and fixtured according to Building Standards. Any additional plumbing
shall be at the Tenant's expense.
 
7.
DEMISING WALLS AND ENTRANCE DOORS

 
Demising Walls and Partitions are not provided on a single tenant floor. On
multiple tenant floors, demising walls and corridor walls are to be provided in
Building Standard drywall and steel stud construction, to underside of slab with
sound baffle. A Building Standard, full height, wood grain, solid core entrance
door plus hardware is provided.
 
8.
FLOORING

 
Smooth finish concrete floor.
 
 
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                    Date this  6th  Day of  June   2012                      
(Cranium Technologies Ltd.)             And                      I/We have
authority to bind the Corporation  

 
 

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