Exhibit 10.72

Table of contents

 

Clause

       

Page

1.

  

DEFINITIONS AND INTERPRETATION

  

1

    

1.1      Definitions

  

1

    

1.2      Interpretation

  

4

    

1.3      Miscellaneous references

  

4

    

1.4      Covenants – joint and several

  

5

    

1.5      Lessee not to permit prohibited matters

  

5

    

1.6      Exclusion of implied covenants and powers

  

5

    

1.7      No partnership, agency or joint venture

  

5

    

1.8      Enforceability of powers etc

  

5

    

1.9      Whole agreement is contained in this lease

  

5

    

1.10    Consent and approval of lessor

  

6

    

1.11    Condition before lessor liable

  

6

    

1.12    References to manager

  

6

    

1.13    Effect of execution

  

6

    

1.14    Notices

  

6

2.

  

SERVICES PROVIDED BY LESSOR

  

7

    

2.1      Quiet enjoyment

  

7

    

2.2      24 hour entry to premises

  

7

    

2.3      Lessee’s use of common areas

  

7

    

2.4      Services provided by lessor in respect of common areas

  

7

    

2.5      Limit on lessor’s obligations

  

8

    

2.6      Grant of car parking licence

  

8

    

2.7      Current Tenant

  

8

    

2.8      Repair by Lessor

  

10

3.

  

LESSEE’S OBLIGATIONS – BASE RENT AND OTHER MONEY

  

10

    

3.1      Payment of base rent and other money

  

10

    

3.2      Definition of outgoings

  

12

    

3.3      Estimates of outgoings, statements and adjustments

  

13

    

3.4      CPI rent reviews

  

14

    

3.5      Interest payable by lessee on overdue money

  

15

 

 

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3.6      Cost of lease, default, lessor’s approval etc

  

15

4.

  

LESSEE’S GENERAL OBLIGATIONS

  

15

    

4.1      Permitted use

  

15

    

4.2      Security of premises

  

17

    

4.3      Obligations relating to access

  

17

    

4.4      Compliance with statutes

  

17

    

4.5      Advertisements and signs

  

17

    

4.6      Fire or emergency drills; evacuation

  

18

    

4.7      Equipment, systems and services

  

18

    

4.8      Lessee to give notice of accident and lack of repair

  

18

    

4.9      Any head lease or other interest

  

19

    

4.10    Restrictions on use of common areas

  

19

    

4.11    No warranty as to suitability, exclusive rights or otherwise

  

20

5.

  

LESSEE’S OBLIGATIONS – PREMISES AND EQUIPMENT

  

20

    

5.1      Repair of premises

  

20

    

5.2      Alterations to premises, partitioning and fixtures

  

21

    

5.3      As built drawings and commissioning data

  

23

    

5.4      No mortgage of lessee’s equipment

  

24

    

5.5      Cleaning of premises by lessee

  

24

    

5.6      Contamination & Underground Storage Tank (“UST”)

  

24

    

5.7      Fitout Security Deposit

  

27

6.

  

INSURANCE, RISK AND INDEMNITY

  

28

    

6.1      Lessee to effect Insurance policy

  

28

    

6.2      Lessee not to void insurances; extra premiums

  

29

    

6.3      Release of lessor and manager

  

30

    

6.4      Indemnities by lessee

  

30

    

6.5      Any failure of services

  

30

    

6.6      No liability for any losses caused by contractors

  

30

    

6.7      Lessee’s obligations at own risk and expense

  

31

7.

  

LESSOR’S GENERAL RIGHTS

  

31

    

7.1      Lessor’s right to inspect and show premises

  

31

    

7.2      Access for maintenance and authority requirements

  

32

    

7.3      For sale notices

  

32

 

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7.4      Easements and rights of support

  

32

    

7.5      Damage by lessee to the complex or land

  

33

8.

  

TRANSFER, SUB-LETTING, SALE OF SHARES ETC

  

33

    

8.1       Transfer, sub-letting, sharing possession, etc

  

33

    

8.1A    Routine Sub-Leases

  

34

    

8.1B    Lessee released on assignment

  

35

    

8.1C    Related corporations

  

35

    

8.2      Limits on mortgage of lease

  

35

    

8.3      Sale of shares – default unless lessor’s requirements met

  

35

    

8.4      Assignment and share transfer – costs and documents

  

36

9.

  

TERMINATION AND YIELDING UP OF PREMISES

  

37

    

9.1      Effect of resumption, destruction or damage

  

37

    

9.2      Lease may be terminated without compensation; abatement

  

37

    

9.3      Removal of lessee’s equipment

  

38

    

9.4      Lessee’s equipment not removed

  

39

    

9.5      Premises to be in good condition on yielding up

  

39

    

9.6      Not Used

  

41

    

9.7      Application of clauses 9.3 to 9.6

  

41

    

9.8      Holding over – monthly; lessee to apply for approval

  

42

10.

  

DEFAULT AND RE–ENTRY

  

42

    

10.1    Lessor’s right to remedy defaults

  

42

    

10.2    Default or breach by lessee – re-entry

  

42

    

10.3    Damages claimable by lessor

  

43

    

10.4    No waiver

  

43

11.

  

BANK BOND/GUARANTEE

  

44

    

11.1    Lessee to obtain unconditional bank bond

  

44

    

11.2    Bond available to meet lessee’s breaches

  

44

    

11.3    Duration of bond

  

44

    

11.4    Further bond on base rent increases

  

45

12.

  

COVENANTOR

  

45

    

12.1    Covenant – joint and several liability

  

45

    

12.2    Indemnities

  

45

    

12.3    Principal obligations

  

45

 

 

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12.4    Continuing liability of covenantor

  

46

    

12.5    Assignment of benefit of covenant

  

47

    

12.6    No proof in estate of lessee in competition with lessor

  

47

    

12.7    Warranties by covenantor

  

47

    

12.8    Covenantor to pay lessor’s costs

  

48

13.

  

OPTION FOR FURTHER TERM

  

48

    

13.1    Right to lease for further term

  

48

    

13.2    Conditions for grant of further term

  

48

    

13.3    Initial base rent

  

48

    

13.4    Terms of further lease

  

49

    

13.5    Execution of further lease

  

49

    

13.6    Bond on grant of further term

  

50

14.

  

LIMITED RECOURSE AGAINST RESPONSIBILITY ENTITY: LEND LEASE REAL ESTATE
INVESTMENTS LIMITED

  

50

 

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ANNEXURE “A” TO LEASE DATED 20/10/2000

 

LESSOR: Lend Lease Real Estate Investments Limited

 

LESSEE: PIXC Australia Pty Limited

 

PREMISES: Unit B, 639 Gardeners Road, Mascot

 

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1.   Definitions and Interpretation

 

  1.1   Definitions

 

In this Lease unless the contrary intention appears:

 

API means Australian Property Institute.

 

Base CPI means the Consumer Price Index (All Groups) for Sydney last published
prior to the date TWELVE (12) months prior to the relevant CPI Review Date.

 

Base Rent means the amount in Item 9, as varied under this Lease.

 

Building means the building containing the Premises on the Land and the Lessor’s
fixtures, fittings, furnishings, plant and equipment at any time in the building
(all as they may from time to time exist, and where the context permits,
includes any part of them).

 

Business Day means Monday to Friday, excluding NSW public holidays.

 

Car Park means that part of the Complex set aside from time to time by the
Lessor for parking cars.

 

Common Areas means all parts of the Complex and the Land now or in the future
used in common by lessees of the Complex and their invitees, all as they may
from time to time exist, and where the context permits includes any part of
them.

 

Complex means the buildings and any other improvements now or in the future on
the Land and the Lessor’s fixtures, fittings, furnishings, plant and equipment
at any time in the buildings and other improvements (all as they may from time
to time exist, and where the context permits, includes any part of them).

 

Contamination means the presence in, on or under the land of a substance at a
concentration above the concentration at which the substance is normally present
in, on or under (respectively) land in the same locality, being a presence that
presents a risk of harm to human health or any other aspect of the environment.

 

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Covenantor means the person (if any, and if more than ONE (1), each of them)
named in Item 14 and includes a person’s executors and administrators and a
corporation’s successors.

 

CPI Review Date means each date (if any) specified or referred to in Item 13(b).

 

Criteria means the criteria in clause 9(a) of Schedule 2;

 

Current Base Rent means the annual market rent of the Premises as at the subject
Review Date, on the basis of clause 9 of Schedule 2;

 

Current CPI means the Consumer Price Index (All Groups) for Sydney last
published prior to the subject CPI Review Date.

 

Established Complex Hours means the hours during which the Lessor is permitted
to keep the Complex open for business (in accordance with all laws and the
requirements of all relevant authorities).

 

Environmental Laws means all laws relating to the environment including but not
limited to any law relating to the use of land, planning, environmental
assessment, the environmental or historic heritage, water, water catchments,
pollution of air, soil, ground water or surface water, noise, soil, chemicals,
pesticides, hazardous goods, building regulation, occupation of buildings,
public health or safety, occupational health and safety, environmental hazard,
any aspect of protection of the environment or the enforcement or administration
of any of those laws (whether those laws arise under statute or the common law
or pursuant to any permit, licence, approval, notice, decree, order or directive
of any governmental agency or otherwise).

 

Further Term means the further term referred to in Item 8(1), commencing on the
day after the date in Item 7.

 

Land means the land described in Item 1 and, where the context permits, includes
part of that land but for the purposes of the definitions of Complex and
Outgoings means the land comprised in Folio Identifiers 1-3/SP 38125.

 

Lease means this lease (and any annexure, exhibit, plan and schedule to it) and
includes any equitable lease or lease at law evidenced by this document (and any
annexure, exhibit, plan and schedule to it).

 

Lessee means the person named in Item 4 and includes its successors, executors
and administrators, its assigns approved by the Lessor and, where the context
permits, includes the Lessee’s Agents.

 

Lessee’s Act or Omission means any act, default, misconduct, neglect, negligence
or omission of any kind of the Lessee or the Lessee’s Agents.

 

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Lessee’s Agents means each and every of the Lessee’s agents, contractors,
employees, invitees, licensees, sub-contractors, sub-lessees and other persons
claiming through or under the Lessee.

 

Lessee’s Equipment means the fixtures, fittings, furnishings, plant and
equipment and other items at any time (whether before or after the commencement
of the Term) installed in or brought onto any part of the Complex by or on
behalf of the Lessee, the Lessee’s Agents or the Lessee’s Predecessors (and,
where the context permits, includes any part of them).

 

Lessee’s Notice means a notice complying with clause 4 of Schedule 2 and served
on the Lessor in accordance with that clause.

 

Lessee’s Predecessors means each and every predecessor in title of the Lessee as
lessee under this Lease (and, where this Lease is one in a series of consecutive
leases granted pursuant to the exercise of options, it means each and every
lessee under a prior lease in the series).

 

Lessee’s Proportion means the percentage in Item 12.

 

Lessor means the person named in Item 3 and includes its successors and assigns,
and where the context permits includes its agents (including, without limit, the
Manager), contractors, employees and sub-contractors.

 

Lessor’s Equipment means all the Lessor’s plant and equipment (including
air-conditioning plant and equipment) in or exclusively servicing the Premises.

 

Lessor’s Notice means a notice served on the Lessee in accordance with clause
2(a) of Schedule 2;

 

Liabilities means each and every cost, expense, liability and loss of any kind
and all damages.

 

Manager means any person appointed from time to time by the Lessor to manage the
Land and the Complex and includes (unless the context otherwise requires) the
agents, contractors and employees of that person.

 

New Lease Commencement Date means the day after the date in Item 7.

 

Outgoings has the meaning given to it in clause 3.2 and Schedule 1.

 

Parking Spaces means the number of parking spaces in the Car Park set out in
Item 16. As at the date in Item 6, the parking spaces licensed to the Lessee are
located as shown on the parking plan provided to the Lessee at or about the date
in Item 6.

 

PCA means Property Council of Australia.

 

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Permitted Use means the use described in Item 10.

 

Premises means (and, where the context permits includes part of) the premises
described in Item 2 and the Lessor’s fixtures, fittings, furnishings, plant and
equipment at any time in the premises. If the area of the Premises is at any
time relevant, it must be measured in accordance with the specifications for
measurement of gross lettable area published in the publication Property Council
of Australia “Method of Measurement” (1997 revision).

 

Review Date means each date (if any) specified or referred to in Item 13(a).

 

Term means the period commencing on the date in Item 6 and expiring at midnight
on the date in Item 7, and where applicable, the period of holding over under
clause 9.8.

 

Termination Date means the date in Item 7.

 

User means each and every person authorised by the Lessee from time to time to
use any of the Parking Spaces and each and every person claiming through or
under an authorised person.

 

Valuer means a person satisfying the criteria in clause 3 of Schedule 2 and
appointed as a valuer pursuant to Schedule 2.

 

Westpac Indicator Lending Rate means the rate published as such from time to
time by Westpac Banking Corporation. If that rate is discontinued, ceases to be
quoted or ceases (in the Lessor’s reasonable opinion) to reflect interest rate
indicators of the type reflected by it at the commencement of this Lease, then
it means the overdraft reference rate per annum applied from time to time by
Commonwealth Bank of Australia at its principal office in Sydney. A certificate
as to a rate given to the Lessor and signed by an officer of the relevant bank
is final and binding on the parties to this Lease (except in the case of
manifest error).

 

  1.2   Interpretation

 

The table of contents and headings are for guidance only and do not affect the
interpretation of this Lease. This Lease is governed by New South Wales law. In
interpreting this Lease, no rule of construction applies to the disadvantage of
a party because that party put forward this Lease.

 

  1.3   Miscellaneous references

 

In the interpretation of this Lease reference to:

 

  (a)   any gender includes every gender;

 

  (b)   singular includes plural and vice versa;

 

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  (c)   persons include bodies corporate and other legal entities;

 

  (d)   a Part, clause, schedule or an Item is, unless the context otherwise
requires, a reference to a Part, clause or schedule of this Lease or an Item in
the Reference Schedule;

 

  (e)   any body which ceases to exist, is reconstituted, renamed or replaced or
has its powers transferred, refers to the body established in its place or which
serves substantially the same objects as or succeeds to its powers; and

 

  (f)   the president of a body means the person acting as the president (or
other principal officer) at a relevant time.

 

  1.4   Covenants – joint and several

 

Any covenant, indemnity or agreement by TWO (2) or more persons as Lessee or as
Covenantor binds them collectively and individually.

 

  1.5   Lessee not to permit prohibited matters

 

Where the Lessee is prohibited from doing any act, matter or thing, it is also
prohibited from permitting or suffering the act, matter or thing and it must
ensure that the Lessee’s Agents do not breach the prohibition. Despite the
preceding sentence, the Lessee is not responsible for the actions of its
invitees outside the Premises.

 

  1.6   Exclusion of implied covenants and powers

 

Sections 84, 84A and 85 of the Conveyancing Act, 1919 do not apply to and are
not implied in this Lease unless they are expressly included.

 

  1.7   No partnership, agency or joint venture

 

Nothing in or under this Lease creates the relationship of partners, principal
and agent or joint venturers between the Lessor and the Lessee.

 

  1.8   Enforceability of powers etc

 

Any law which prejudicially affects any party’s powers, discretions, remedies,
rights or obligations (Powers) is excluded to the extent lawfully permissible.
If any Power cannot be given full effect, that Power must be severed or read
down to maintain (as far as possible) all other provisions of this Lease.

 

  1.9   Whole agreement is contained in this lease

 

This Lease comprise the whole of the agreement between the parties in respect of
their subject matter.

 

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  1.10   Consent and approval of lessor

 

Unless expressly stated in a particular provision, the Lessor must not
unreasonably withhold or delay its consent or approval under this Lease (but may
give it subject to reasonable conditions). Any consent or approval by the Lessor
must be in writing.

 

  1.11   Condition before lessor liable

 

Despite anything in this Lease to the contrary, the Lessor is not in default in
its obligations unless the Lessee has given notice to the Lessor of the default
and the Lessor has failed within a reasonable time after notice to take proper
steps to rectify the default in accordance with this Lease.

 

  1.12   References to manager

 

Any notice or thing which must be delivered or given to the Manager or any
payment or request which must be made to the Manager, must be delivered, given
or made to the Manager or such other person as may be nominated from time to
time by the Lessor by notice to the Lessee. The Manager may exercise the
Lessor’s powers, discretions and rights and make any determination which may be
made by the Lessor under this Lease unless the Lessor itself notifies the Lessee
to the contrary.

 

  1.13   Effect of execution

 

Each Lessee and Covenantor is bound by this Lease even though:

 

  (a)   any other Lessee or Covenantor has not executed or may never execute
this Lease or the execution of this Lease by any other Lessee or Covenantor is
or may become void or voidable, or

 

  (b)   this Lease has not been registered or may never be registered and
despite any obligation the Lessor may have to register it.

 

This Lease is a deed, even if it is not registered.

 

  1.14   Notices

 

  (a)   In this Lease, reference to notice means notice in writing.

 

  (b)   Any notice or other writing served by the Lessor is valid and effective
if given under the common seal of the Lessor or the Manager or signed by an
attorney, director, company secretary, authorised officer or solicitor of the
Lessor or the Manager.

 

  (c)   Any notice or other writing is sufficiently served on the Lessee (or
Covenantor) if served personally or if forwarded to the Lessee (or

 

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Covenantor) by courier, facsimile or post to the Premises or the last address of
the Lessee (or Covenantor) known to the Lessor or the Manager.

 

  (d)   Unless the Lessor otherwise notifies the Lessee, any notice or writing
is sufficiently served on it if served on the Manager.

 

  (e)   If any notice or other writing is served on a day which is not a
Business Day or is after 5:00pm (addressee’s time) it is deemed to be served on
the next Business Day.

 

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2.   Services Provided By Lessor

 

  2.1   Quiet enjoyment

 

If the Lessee complies with this Lease, it may possess the Premises during the
Term without disturbance from the Lessor (or persons claiming through it) except
to the extent disturbance is expressly permitted by this Lease.

 

  2.2   24 hour entry to premises

 

The Lessee may enter and use the Premises at any time, subject to this Lease,
the law and requirements of statutory authorities.

 

  2.3   Lessee’s use of common areas

 

The Lessee may use the Common Areas in common with the Lessor (and others
entitled to use them) in accordance with this Lease.

 

  2.4   Services provided by lessor in respect of common areas

 

  (a)   The Lessor agrees to provide the following services in the areas and to
the standards from time to time determined by the Lessor:

 

  (1)   gardening and landscaping in the Common Areas;

 

  (2)   lighting in the Common Areas;

 

  (3)   security in the Common Areas or perimeter security for the Complex (but
not security in respect of the Premises or the Car Park); and

 

  (4)   a tenant directory board.

 

  (b)   The Lessor must have carried out a regular program for repair and
maintenance of the Common Areas, including, without limit, of the

 

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         common driveway areas of the Car Park (but not the car parking spaces
licensed to particular persons).

 

  2.5   Limit on lessor’s obligations

 

  (a)   The Lessor’s obligations under clause 2.4 are subject to exceptions for
delays or stoppages due to repairs, maintenance, testing, commissioning,
cleaning, strikes, accidents or unforeseen or unavoidable causes.

 

  (b)   Despite clause 2.4 or any other provision of this Lease, the Lessor is
not liable for any failure to comply with clause 2.4 or to otherwise provide or
maintain any services or equipment where the failure is caused or contributed to
(but only to the extent of such contribution) by the Lessee’s Act or Omission.

 

  (c)   The Lessor may carry out at the Lessee’s cost any maintenance, repair or
rectification for which the Lessee is liable pursuant to sub-clause (b).

 

  2.6   Grant of car parking licence

 

  (a)   The Lessor grants and the Lessee accepts a non-exclusive licence
authorising the Lessee to park cars in the Parking Spaces during the Term
subject to this Lease (and in particular, Schedule 3).

 

  (b)   Subject to clause 2.6(c), the Lessor must ensure that the part of the
Complex set aside for the parking of cars from time to time is always of
sufficient size to accommodate the Parking Spaces and is not altered or
relocated so as to materially disadvantage the Lessee.

 

  (c)   If the Lessee exercises its rights pursuant to clause 4.10(a) the number
of Parking Spaces shall be reduced having regard to the area occupied by the
power generator or back up generators installed by the Lessee.

 

Where an obligation is imposed on the Lessor in relation to the Car Park, the
Lessor must perform or cause the obligation to be performed.

 

  (d)   The Lessee is not given any right of exclusive occupation of the Parking
Spaces. The rights conferred in relation to the Parking Spaces are in contract
only.

 

  2.7   Current Tenant

 

  (a)   The parties acknowledge that the Premises are currently occupied by
Mayne Nickless Limited (“Current Tenant”) under lease registered number 2408703.

 

  (b)   This Lease commences on the earlier of the following dates (Commencement
of Lease):

 

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  (1)   the date 7 days after the Current Tenant has vacated the Premises; and

 

  (2)   the date 6 weeks after the Lessee has notified the Lessor that it
requires this Lease to commence

 

PROVIDED THAT in either case the Premises are available for occupation by the
Lessee and the Lessor has notified the Lessee that the Current Tenant has
vacated the Premises and the Premises are available for occupation by the
Lessee.

 

The Lessor agrees that it will not request or encourage the Current Tenant to
vacate the Premises unless the Lessee gives notice under clause 2.8(b)(2).

 

  (c)   Lessee forms the view that:

 

  (1)   the playing laws applicable to the Premises do not permit the Lessee’s
proposed use of the Premises; or

 

  (2)   the Lessee will not be able to obtain all necessary approvals from all
relevant authorities on reasonable conditions and within a reasonable time to
use the Premises for such use,

 

the Lessee will be entitled to terminate this Lease. The right of termination
must be exercised prior to 31 December 2000 or such later date as the parties
may agree. The Lessor agrees to take such steps as may be reasonably required on
its part to assist the Lessee to obtain such approvals and the Lessee agrees to
use its reasonable endeavours to obtain such approvals as soon as reasonably
practicable. The Lessee must indemnify the Lessor for any costs and expenses
reasonably incurred by the Lessor in assisting the Lessee to obtain the
necessary approvals.

 

  (d)   If the Lessee terminates this Lease under clause 2.8(c) the Lessee must
pay to the Lessor Base Rent and the Lessee’s Proportion of the Lessor’s estimate
of Outgoings for the period of 9 months commencing on the date of termination by
monthly instalments in advance. The Lessor must use reasonable endeavours to
re-lease the Premises as soon as reasonably practicable after termination and
the amount payable by the Lessee under this clause will be reduced by the amount
of the rent or other payments received by the Lessor from any new tenant or
occupant of the Premises in respect of the period of 9 months following
termination of this Lease. The Lessor agrees to consider in good faith any
leasing proposal submitted by the Lessee or the Lessee’s agents. If the Lessee
wishes to seek a replacement tenant for the Premises during this period it will
be permitted to do so.

 

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  (e)   The bond provided by the Lessee pursuant to clause 11 will be available
to the Lessor as security for the Lessee’s obligations under this clause 2.8 and
will not be released until the Lessee has discharged its obligations pursuant to
this clause 2.8.

 

  (f)   The Lessee irrevocably authorises and directs the Lessor (and its
solicitors) to complete and deliver this Lease by inserting:

 

  (1)   the Commencement of Lease in Item 6; and

 

  (2)   the Termination of Lease date in Item 7 being the date 15 years less 1
day after the date of the Commencement of Lease.

 

  2.8   Repair by Lessor

 

  (a)   The Lessor must cause to be carried out a regular programme of repair
and maintenance in respect of the external surfaces of the Building (including,
without limit, the roof) and promptly carry out or cause to be carried out in a
workmanlike manner using appropriate materials and equipment all such repairs
and maintenance as are in such programme found to be necessary.

 

  (b)   The Lessor must repair or cause to be repaired (including, where
necessary repair by way of replacement) any structural parts of the Building in
need of repair within a reasonable time after becoming aware of the same.

 

  (c)   The Lessee agrees to notify the Lessor of any damage of a structural
nature in or about the Premises upon actually becoming aware of the same.

 

  (d)   Despite sub-clauses (a) and (b) the Lessor is not obliged to carry out
any maintenance work, repair or rectification work made necessary by reason of
or arising out of the Lessee’s Act or Omission or which the Lessee itself is
obliged to carry out under this Lease.

 

  (e)   Any maintenance work, repair or rectification work made necessary by
reason of or arising out of any occurrence referred to in sub-clause (d) may be
carried out by the Lessor at the cost of the Lessee after giving notice of the
work to the Lessee (except in an emergency or where the Lessor perceives an
emergency, where no notice is required).

 

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3.   Lessee’s Obligations – Base Rent And Other Money

 

  3.1   Payment of base rent and other money

 

  (a)   Base rent: The Lessee must pay Base Rent to the Lessor by monthly
instalments each equal to ONE TWELFTH (1/12th) of the then current

 

10

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  Base   Rent. If necessary, the first and last payments shall be apportioned in
respect of time.

 

  (b)   Outgoings: Subject to clause 3.3, if the Lessor notifies the Lessee of
the Lessee’s Proportion of the Lessor’s estimate of Outgoings, the Lessee must
pay the Lessee’s Proportion of the estimate to the Lessor during the period to
which the estimate relates by equal monthly instalments.

 

  (c)   Timing for payment of base rent and outgoings: Instalments of Base Rent
and Lessee’s Proportion of estimated Outgoings must be paid (whether or not
demanded by the Lessor) in advance on the first day of the Term and on the first
Business Day of every calendar month in the Term.

 

  (d)   Timing for payment of other money: Unless otherwise specified in this
Lease, all money payable by the Lessee to the Lessor must be paid within TEN
(10) Business Days of service on the Lessee of the monthly statement requiring
payment of the same.

 

  (e)   Method of payment:

 

  (1)   Unless otherwise agreed in writing between the Lessor and the Lessee,
the Lessee must, if required by the Lessor, pay all Base Rent and Lessee’s
Proportion of Outgoings to the Lessor by directing the Lessee’s bank to debit
the Lessee’s account for those amounts and credit them to the bank account
nominated by the Lessor from time to time.

 

  (2)   Subject to paragraph (1) and unless the Lessor otherwise notifies the
Lessee, all money payable by the Lessee to the Lessor must be paid by unendorsed
cheque payable to the Manager delivered to the Manager at the place notified by
the Manager.

 

  (3)   All money payable by the Lessee must be paid free of exchange, without
deduction or set-off.

 

  (f)   Services in premises: The Lessee must promptly pay all accounts for
electricity, oil, gas and other services consumed in the Premises by or on
behalf of the Lessee.

 

  (g)   Any special charges: The Lessee must pay the Lessor any assessment for
trade waste, excess water or other costs incurred as a result of the Lessee’s
use or occupation of the Premises and the Lessor’s costs and expenses in
operating, repairing and maintaining the services and facilities (if any)
provided solely to the Premises. To the extent the services and facilities are
provided to premises within the Complex (other than the Premises) and to the
Premises such costs and expenses will be recoverable as an Outgoing pursuant to
and in accordance with clauses 3.2 and 3.3. The Lessee must pay all costs (as
defined in clause 3.2(b)) assessed directly on

 

11

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the Premises, but excluding any costs of the kind referred to in clauses
3.2(a)(4) or (5), or on the Lessor or the Lessee in respect of the Premises.
Unless directed otherwise by the Lessor, the Lessee must pay those costs
directly to the relevant assessing authority on or by their due date.

 

  (h)   GST: Despite any other provision of this Lease, if a goods and services
tax or similar value added tax (GST) is levied or imposed on any supply made (or
deemed to be made) under or in accordance with this Lease, the amount payable
for that supply (or deemed supply) is increased by an amount equal to that GST.
Despite any other provision of this Lease, the amount payable by the Lessee for
any Outgoings shall not be increased by the amount of any GST levied or imposed
on the Lessor in respect of that Outgoing if the Lessor is entitled to an input
tax credit or other similar tax credit for the amount of the GST. The Lessor
must issue to the Lessee a tax invoice in respect of the payment required.

 

  (i)   Rental Incentive: Notwithstanding any other provision of this Lease, the
Lessee is not obliged to pay Base Rent for the first five (5) months after this
Lease is incapable of being terminated pursuant to clause 2.8.

 

  3.2   Definition of outgoings

 

  (a)   “Outgoings” means all costs which the Lessor, acting in good faith,
determines are paid or payable for or attributable to insuring, repairing,
maintaining, managing, administering, supervising, keeping secure or providing
services for the Complex and the Land (or any part of either of them), except:

 

  (1)   costs of cleaning any part of the Complex occupied for the time being by
a lessee or licensee,

 

  (2)   any commission or similar charge paid to any person in connection with
letting or licensing any part of the Complex,

 

  (3)   the Lessor’s income tax or capital gains tax,

 

  (4)   any cost for which a particular lessee or licensee of any part of the
Complex is responsible, or

 

  (5)   in relation to clause 3 of Section A of Schedule 1, costs of any
structural work and costs treated by the Lessor (in good faith) in its
accounting statements as capital expenses (but a repair by replacement of parts
not comprised in structural works or treated as capital expenses is to be
included in Outgoings).

 

  (b)   In this clause and in Schedule 1, “costs” means all assessments,
charges, costs, duties, expenses, fees, levies, rates, taxes, wages and
outgoings.

 

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  (c)   Without limiting sub-clause (a), Outgoings include the costs referred to
in Schedule 1. All Outgoings accrue daily in equal increments and must be
apportioned accordingly.

 

  3.3   Estimates of outgoings, statements and adjustments

 

  (a)   The Lessor may notify the Lessee of the Lessee’s Proportion of the
Lessor’s estimate in good faith of Outgoings for any period not exceeding ONE
(1) year in advance.

 

  (b)   As soon as practicable after each 1 July, the Lessor must give the
Lessee a statement of Outgoings for the year ending on the preceding 30 June
(PrecedingYear). The statement must contain or indicate:

 

  (1)   the amount for each clause heading in Schedule 1 and the total Outgoings
for the Preceding Year;

 

  (2)   copy of a certificate signed by a registered company auditor that in his
opinion, based on the results of his auditing procedures, the statement records
the Outgoings for the Preceding Year; and

 

  (3)   the balance of the Lessee’s Proportion of Outgoings payable by the
Lessee (or any over-payment to be credited to the Lessee).

 

  (c)   Unless the Lessor or the Lessee gives the other notice detailing a
numerical error in the statement within ONE (1) month of its service, then
within that same month:

 

  (1)   the Lessee must pay the Lessor any balance shown as payable by the
Lessee in the statement; or

 

  (2)   the Lessor must credit any overpayment by the Lessee to the Lessee’s
account (or refund the overpayment if no other money is payable to the Lessor).

 

  (d)   If the Lessor or the Lessee gives notice under sub-clause (c), a further
statement (complying with sub-clause (b)) must be given. Sub-clause (c) applies
to the further statement.

 

  (e)   If the Lessor sells any of the land comprised in Folio Identifiers
1-3/SP38125 the Lessor, acting reasonably, must adjust the Lessee’s Proportion
to a percentage which then reflects the percentage which the gross lettable area
of the Premises then bears to the gross lettable area of the buildings
comprising the Complex other than the land sold by the Lessor.

 

13

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  3.4   CPI rent reviews

 

  (a)   At each CPI Review Date, the Base Rent must be reviewed and the Base
Rent payable on and from the relevant CPI Review Date until the next CPI Review
Date or Review Date (whichever occurs first) shall be the greater of:

 

  (1)   the Base Rent payable immediately prior to the relevant CPI Review Date
plus an amount equal to four per cent (4%) thereof; and

 

  (2)   the amount calculated as follows:

 

A = B x

  

C

D

 

where:

 

A =

  

the amount referred to in this paragraph (2);

B =

  

the Base Rent payable immediately prior to the relevant CPI Review Date;

C =

  

the Current CPI; and

D =

  

tthe Base CPI.

 

  (b)   Where the application of sub-clause (a) results in a number of dollars
and a number of cents, the amount must be rounded up to the nearest dollar.

 

  (c)   If at any time the Consumer Price Index is discontinued or abolished,
then the price index substituted for it by the Australian Statistician shall be
used for the calculations referred to in sub-clause (a).

 

  (d)   If no price index is substituted for the Consumer Price Index by the
Australian Statistician, then such index or indices shall be used as in the
opinion of the chief accountant or other similar senior responsible officer of
Westpac Banking Corporation Limited (or such other bank as the Lessor may
nominate from time to time) most accurately reflects the changes in the
prevailing levels of prices in Sydney. A certificate as to the index or indices
given to the Lessor and signed by the chief accountant or other similar senior
responsible officer of Westpac Banking Corporation Limited (or such other bank
as the Lessor may nominate from time to time) is final and binding on the Lessor
and the Lessee.

 

  (e)   If at any time the Australian Statistician changes the reference base
for the Consumer Price Index, then, for the purposes of the application of this

 

14

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clause after the change takes place, regard shall be had only to index numbers
published in terms of the new reference base.

 

  (f)   The Lessor’s right to have the Base Rent reviewed as at a CPI Review
Date is not forfeited, lost, postponed or otherwise prejudicially affected if
the Lessor fails to review the Base Rent in accordance with this clause or to
notify the Lessee of the reviewed Base Rent.

 

  3.5   Interest payable by lessee on overdue money

 

  (a)   Without prejudicing the Lessor’s other rights and remedies, the Lessee
must pay interest to the Lessor at the Prescribed Rate on any money due but
unpaid by the Lessee.

 

  (b)   Interest shall be calculated daily from the due date up to and including
the date the Lessor receives full payment.

 

  (c)   Failure by the Lessor to promptly claim interest on arrears does not
waive the Lessor’s right to claim interest.

 

  (d)   “Prescribed Rate” means TWO per cent (2%) more than the Westpac
Indicator Lending Rate current at the date the money becomes due, and at the
first day of each month while the money remains due.

 

  3.6   Cost of lease, default, lessor’s approval etc

 

The Lessee must pay within TEN (10) Business Days of written notice the Lessor’s
reasonable costs (including legal costs) and all charges, duties, fees and
expenses of or incidental to:

 

  (a)   the preparation, negotiation, completion, stamping and registration of
this Lease (including any certificate of registration) and any further lease,

 

  (b)   any request for the consent or approval of or waiver by the Lessor (and
of any head lessor and mortgagee of the Lessor),

 

  (c)   any breach or default by the Lessee or the Lessee’s Agents under this
Lease, and the exercise or attempted or proposed exercise of any right, power or
remedy of the Lessor under this Lease, in law or equity, and

 

  (d)   surrender or termination of this Lease other than by expiration.

 

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4.   Lessee’s General Obligations

 

  4.1   Permitted use

 

  (a)   The Lessee must only use the Premises for the Permitted Use.

 

15

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  (b)   The Lessee must promptly obtain and comply with all approvals, consents,
licences and permits required for the Premises to be lawfully used for the
Permitted Use and for any works to be effected in the Premises by the Lessee.

 

  (c)   The Lessee must not conduct any illegal, immoral, offensive or unlawful
use in the Complex or do anything in the Complex which causes nuisance, damage
or disturbance to any occupier of the Complex or any occupier of any nearby
property.

 

  (d)   The Lessee must not, without the prior consent of the Lessor (given or
withheld in its absolute discretion) and all relevant authorities, have in the
Premises anything which is flammable, explosive, toxic, hazardous or injurious
to health. If the Lessee, with the prior consent of the Lessor and all relevant
authorities, has in the Premises anything which is flammable, explosive, toxic,
hazardous or injurious to health, the Lessee must (at intervals of not more than
SIX (6) months and more frequently if requested by the Lessor) provide to the
Lessor a statement setting out in detail:

 

  (1)   the type and quantity of the items or materials on the Premises which
are flammable, explosive, toxic, hazardous or injurious to health; and

 

  (2)   the licences and permits which the Lessee is required to effect and
maintain in relation to those items and materials (together with evidence
satisfactory to the Lessor establishing the currency of those licences and
permits).

 

The Lessor acknowledges that it has consented to the Lessee installing
underground fuel storage tanks (and storing fuel in those tanks) and such
batteries as are reasonably required for the purposes of the Lessee’s power
generator and stand by power generators.

 

  (e)   The Lessee must take all reasonable steps to ensure that people in the
Complex are not injured by any cigarette, cigar or tobacco smoke originating in
the Premises.

 

  (f)   The Lessee must not bring on the Premises plant or equipment which may
damage or overload the Complex.

 

  (g)   The Lessee must take all reasonable precautions to keep the Premises
free of vermin, insects, birds and animals and, as required by the Lessor, must
employ qualified pest exterminators.

 

16

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  4.2   Security of premises

 

  (a)   The Lessee must use all reasonable endeavours to keep the Premises safe
from theft and to lock all lockable doors when the Premises are unoccupied.

 

  (b)   People authorised by the Lessor may enter the Premises for any purpose
relating to security, but this does not make the Lessor responsible for the
security of the Premises. People authorised by the Lessor may only enter the
Premises under this clause 4.2(b) on giving reasonable notice to the Lessee and
must be accompanied by a representative of the Lessee if the Lessee offers to
make such representative available at a reasonable time. This clause 4.2(b) does
not apply in the case of an emergency or where the Lessee’s representative is
not available at the appointed time.

 

  4.3   Obligations relating to access

 

In exercising its rights in clause 2.2, the Lessee must comply with the Lessor’s
reasonable requirements for control of, access to and use of the Complex outside
Established Complex Hours. Clause 2.2 does not limit the Lessor’s right to at
any time clean, maintain, repair, service, test, renovate and refurbish any part
of the Complex.

 

  4.4   Compliance with statutes

 

  (a)   The Lessee must comply with all statutes and regulations and all
approvals, directions, requirements, notices, orders or permits of any authority
in respect of this Lease, the Premises, the use of the Premises, the health or
safety of people using the Premises, and the Lessee’s Equipment (including all
Environmental Laws).

 

  (b)   The Lessee is not liable under sub-clause (a) for any alteration or
addition to the structural parts of the Complex unless caused or contributed to
(and then only to the extent contributed to) by the Lessee’s or the Lessee’s
Agents’ particular use or occupation of the Premises.

 

  (c)   The Lessee must immediately give notice to the Lessor if the Lessee
receives any direction, requirement, notice or order from any government or
authority in respect of this Lease, the Premises, the Complex, the use of the
Premises or the Complex, the health or safety of people using the Premises, the
health or safety of people using the Complex or the Lessee’s Equipment.

 

  4.5   Advertisements and signs

 

The Lessee must not without the Lessor’s prior approval and the prior approval
of all relevant authorities:

 

17

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  (a)   affix or display any advertisement, logo, notice, sign or other device
to or in the Complex; or

 

  (b)   use the name of or any picture or likeness of the Complex for any
advertisement or purpose other than as the address and place of business of the
Lessee (and then only while the Lessee is in occupation of the Premises).

 

  4.6   Fire or emergency drills; evacuation

 

  (a)   The Lessee must comply with all the Lessor’s fire and emergency drills
and instruction programs for fire and emergency procedures.

 

  (b)   The Lessee must appoint and keep appointed an adequate number of wardens
for the Premises. The Lessee must promptly give notice to the Manager of the
names of the wardens.

 

  (c)   Either the Lessor or the Manager (if informed of a bomb threat or
believing there is a fire or other risk in the Complex) may request the Lessee
and the Lessee’s Agents to immediately vacate the Premises or the Complex and
they must immediately comply.

 

  (d)   The Lessee and the Lessee’s Agents have no claim against the Lessor or
the Manager for any loss, injury, death, damages for loss of profits, abatement
or set-off due to or arising out of any drill, program or evacuation under this
clause, except to the extent that the same has been caused by the negligence of
the Lessor or the Manager.

 

  4.7   Equipment, systems and services

 

The Lessee must:

 

  (a)   not install or connect any equipment or do any act that overloads the
Lessor’s air-conditioning plant and equipment or the cables or boards through
which electricity is conveyed in the Complex,

 

  (b)   ensure that any security alarm system installed by the Lessee does not
activate any Complex system, and

 

  (c)   comply with the Lessor’s reasonable requirements in relation to (and
must not do anything which interferes with the efficient operation of) the
air-conditioning plant and equipment, security, sprinkler and fire alarm
installations and any other services in and amenities of the Complex.

 

  4.8   Lessee to give notice of accident and lack of repair

 

Immediately on becoming aware of the same, the Lessee must notify the Manager
of:

 

18

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  (a)   damage, injury, death or loss occurring in and any defect or want of
repair in the Premises or in any services in or to the Complex, and

 

  (b)   any circumstances likely to cause danger, risk or hazard to any person
or property in or services and amenities of the Complex, including without limit
any possible Contamination.

 

  4.9   Any head lease or other interest

 

  (a)   The Lessee must permit any person having an interest in the Land or the
Complex superior to or concurrent with the Lessor to exercise the Lessor’s
rights under this Lease and to exercise their lawful rights in respect of the
Premises.

 

  (b)   Any person (other than the Lessor) who becomes entitled to receive the
money payable under this Lease has the benefit of all the Lessee’s and any
Covenantor’s agreements under this Lease. The Lessee and the Covenantor must (at
the Lessor’s reasonable cost) promptly on request enter into a deed with that
person in the form and containing the provisions reasonably required by the
Lessor.

 

  4.10   Restrictions on use of common areas

 

  (a)   The Lessee must not use without the prior consent of the Lessor (given
or withheld in its absolute discretion) and all relevant authorities any part of
the Complex or the Land (other than the Premises) for any purpose other than a
purpose for which it was constructed or provided (in the Lessor’s reasonable
opinion). The Lessor acknowledges that it will not unreasonably withhold its
consent to the installation and maintenance by the Lessee of a power generator
and back up generators in the Common Areas subject to the provisions of clause
5.2(b) to (e) applying mutatis mutandis.

 

  (b)   The Lessor may pass and run services through the drains, ducts, risers,
pipes, cabling and wires forming part of or leading through or adjoining any
Common Areas and change the area, location, type of finish of or facilities in
the Common Areas.

 

  (c)   The Lessee must use all reasonable endeavours not to litter any Common
Areas or put or leave them in a dirty or untidy condition.

 

  (d)   The Lessee must at all times strictly comply with:

 

  (1)   all traffic signs in and about the Car Park and its entrances and exits;

 

19

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  (2)   any conditions of entry and rules applying from time to time in respect
of the Car Park and of which the Lessee has been given a copy or which are
displayed in the Car Park; and

 

  (3)   the Lessor’s directions from time to time in relation to the use of and
access to the Car Park.

 

This sub-clause does not limit the Lessee’s obligations in relation to any
Parking Spaces which have been licensed to the Lessee.

 

  4.11   No warranty as to suitability, exclusive rights or otherwise

 

  (a)   The Lessee agrees that (other than as disclosed under sub-clause (b) or
as expressly contained in this Lease), no promise, representation, undertaking
or warranty given by or on behalf of the Lessor or the Manager has been relied
on by the Lessee in entering into this Lease or has in any material way induced
the Lessee to enter into this Lease.

 

  (b)   The Lessee must disclose to the Lessor in writing before the Lessee
executes this Lease any promise, representation, undertaking or warranty (other
than those expressly contained in this Lease) that the Lessee has relied on in
entering into this Lease or which has in any material way induced the Lessee to
enter into this Lease.

 

  (c)   The Lessee is liable to the Lessor in damages for all Liabilities which
the Lessor or the Manager suffers or incurs arising out of the Lessee’s failure
to disclose and for any judgment awarded against the Lessor or the Manager
arising out of any promise, representation, undertaking or warranty given by or
on behalf of the Lessor or the Manager and not disclosed by the Lessee.

 

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5.   Lessee’s Obligations – Premises And Equipment

 

  5.1   Repair of premises

 

  (a)   The Lessee must maintain, repair and keep the Premises in good and
substantial repair, order and condition (the Premises being in that state at the
date in Item 6), except for damage caused by reasonable wear and tear,
explosion, earthquake, aircraft or other aerial device, civil commotion, fire,
flood, lightning, riot, storm, tempest, act of God or war.

 

  (b)   Despite sub-clause (a), the Lessee is not required to repair any
structural parts of the Premises except where the need for the repair arises out
of the Lessee’s Act or Omission, any act, default, misconduct, neglect,
negligence or omission of the Lessee’s Predecessors or any work effected

 

20

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by or on behalf of the Lessee, the Lessee’s Agents or the Lessee’s Predecessors
at any time (before or after the commencement of the Term).

 

  (c)   Despite sub-clause (a) and clause 9.5, the Lessee must, at its own
expense:

 

  (1)   re-paint: paint, regrout, re-cover, clean or otherwise appropriately
treat those parts of the Premises and the Lessee’s partitions usually so treated
in a proper workmanlike manner, with materials and to standards approved by the
Lessor at or immediately prior to the Lessee yielding up the Premises

 

  (2)   lessee’s equipment: maintain the Lessee’s Equipment clean and in good
repair and condition, and keep current maintenance and repair contracts (in
accordance with the Lessor’s reasonable requirements) in respect of any Lessee’s
Equipment linked to the air-conditioning, electrical, fire protection, emergency
or other Complex systems;

 

  (3)   lessor’s equipment: maintain the Lessor’s Equipment clean and in good
repair and condition, and keep current maintenance and repair contracts (with
contractors approved by the Lessor and otherwise in accordance with the Lessor’s
reasonable requirements) in respect of any Lessor’s Equipment in the nature of
air-conditioning, electrical, fire protection or emergency systems; and

 

  (4)   carpets: repair any damage (but excluding fair wear and tear) to the
carpet or the Lessor’s other furnishings in the Premises where that damage
arises from the installation, relocation or removal of any fixtures, fittings,
furnishings, plant or equipment or from the Lessee’s Act or Omission.

 

  (d)   In this clause “repair” includes replacement, where repair is not
reasonably practical. Any replacements of the Lessor’s fixtures, fittings,
furnishings, plant and equipment belong to the Lessor.

 

  5.2   Alterations to premises, partitioning and fixtures

 

  (a)   The Lessee must not without the prior approval of the Lessor and all
relevant authorities:

 

  (1)   alter the Premises or the Complex,

 

  (2)   use in the Premises or the Complex any explosive power driven method of
fixing articles or any cutting or welding equipment using or generating electric
current, heat, flame, molten metal or spark,

 

21

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  (3)   cut, deface, drill, hole, mark or affix anything to any floor, floor
covering, ceiling, curtain, wall or window of the Premises or the Complex,

 

  (4)   install, alter or relocate the Lessee’s partitions, fixtures or cabling
in or adjacent to the Premises (Lessee’s Fixtures), or

 

  (5)   install additional lights or alter lights, power outlets, switches,
electrical switching arrangements, telephone outlets, Lessor’s air-conditioning
plant and equipment, plumbing, sprinkler, security and fire alarm installations
or other equipment and plant in or adjacent to the Premises.

 

The Lessor’s approval is not required in relation to alterations to the Premises
under clause 5.2(a)(1) or matters referred to in clauses 5.2(a)(3), (4) or (5)
(other than in respect of the Initial Fit Out referred to in clause 5.2(f))
which are within the Premises and which do not materially affect the structure,
services, electrical, hydraulic, plumbing or mechanical components of the
Complex or the Premises or the Lessor’s Equipment.

 

  (b)   In seeking the Lessor’s approval under sub-clause (a), the Lessee must
submit to the Lessor the details the Lessor reasonably requires. The Lessor’s
approval to the matters in paragraphs (1) to (3) (inclusive) may be given or
withheld in its absolute discretion.

 

  (c)   Any approvals given under sub-clause (a) will be subject to the Lessor’s
reasonable conditions including (without limit) the standard and quality of
finishes and that:

 

  (1)   any contractor keeps current a public liability policy complying with
the Lessee’s obligations under clause 6.1 and a contractors all risk policy,

 

  (2)   the Lessee, its contractors and sub-contractors comply with any site
agreements applying to the Complex,

 

  (3)   the work be supervised by a person reasonably approved by the Lessor and
carried out by competent tradesmen,

 

  (4)   the floor coverings in the Premises and the floors of relevant Common
Areas be lined by the Lessee with suitable material during delivery or removal
of dust, fibre or powder creating material,

 

  (5)   the Lessee pays the Lessor’s reasonable costs in considering the
Lessee’s submissions and supervising those works and the reasonable fees of any
consultants engaged by the Lessor, and

 

22

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  (6)   the Lessee obtains and delivers to the Manager copies of certificates of
compliance issued by relevant authorities.

 

  (d)   The Lessee must pay:

 

  (1)   the cost of the Lessee’s Fixtures and the cost of installing, altering
or relocating the Lessee’s Fixtures,

 

  (2)   the cost of all additional lights and all alterations to the items
referred to in sub-clause (a)(5) reasonably required by the Lessor or required
by law, by any authority or by the Lessor’s insurer as a result of any of the
matters referred to in sub-clause (a), and

 

  (3)   the cost of obtaining the approvals of all relevant authorities to the
matters referred to in sub-clause (a).

 

  (e)   The Lessee must ensure that all work carried out by it or on its behalf
is carried out at times and in a manner which causes no damage or nuisance to
and which minimises disturbance and inconvenience to others occupying or using
the Complex. The Lessee must comply with the Lessor’s directions in that
respect.

 

  (f)   Despite anything else in this lease:

 

  (1)   the Lessor acknowledges that the Premises have not been fitted out and
that the Lessee proposes to carry out substantial fit out works including
without limitation installing its own air conditioning and fire protection
system, underground fuel storage tanks, power generators and other fixtures and
fittings appropriate for a telehouse facility (“Initial Fit Out”).

 

  (2)   The Lessor must not unreasonably refuse or delay approval of the Initial
Fit Out provided that the Lessor may withhold its approval in its absolute
discretion in relation to any matters concerning the Initial Fit Out which the
Lessor believes are likely materially and detrimentally to affect the structure,
services, electrical, hydraulic, plumbing or mechanical components of the
Premises or the Complex or the Lessor’s Equipment.

 

  5.3   As built drawings and commissioning data

 

Within ONE (1) month of completion of any works in clause 5.2, the Lessee must
obtain and deliver to the Lessor written details of all commissioning data and
hard copies of professionally drawn accurately dimensioned “as built” drawings
of the works (including diagrams of the items referred to in clause 5.2(a)(5)).

 

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  5.4   No mortgage of lessee’s equipment

 

The Lessee must not charge, lease, hire or mortgage any Lessee’s Equipment
without the Lessor’s prior consent which will be given if the Lessee’s credit
provider promptly signs and returns the Lessor’s reasonable documentation and
the Lessee has paid the Lessor’s reasonable costs and expenses of and incidental
to the consent and documentation.

 

  5.5   Cleaning of premises by lessee

 

  (a)   The Lessee must at its own expense engage a contractor (approved by the
Lessor) to clean and remove garbage from the Premises. The Lessee must ensure
that the contractor regularly cleans the Premises in a proper and workmanlike
manner and at all times keeps the Premises clean and free from dirt, garbage and
rubbish.

 

  (b)   The Lessee must store and keep all trade waste, trash and garbage in
proper receptacles (provided by the Lessee) inside the Premises (including
proper and sealed water tight containers for wet garbage) and arrange for the
regular removal of all trade waste, trash and garbage from the Premises and the
Complex.

 

  (c)   The Lessee must ensure that any equipment or material dangerous to
health is properly wrapped before being disposed of and, where appropriate, is
sealed in containers which are clearly marked to show the contents of the
container and an appropriate warning.

 

  (d)   The Lessee must at all times keep and maintain any waste pipes, drains
and conduits originating in the Premises clean, clear and free flowing between
their points of origin and their point into the trunk drain. The Lessee must at
its own expense employ properly licensed tradesmen approved by the Lessor to
promptly clear any blockages.

 

  5.6   Contamination & Underground Storage Tank (“UST”)

 

              Definitions

 

  (a)   In this clause 5.6, the following expressions have the following
meanings:

 

“Commencement Date” means the date specified in Item 6.

 

“contaminant” has the meaning given to the term in the Contaminated Land
Management Act 1997.

 

“Environmental Costs” means the following losses, costs, liabilities, expenses
and damages:

 

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  (1)   those incurred in any Remediation pursuant to a statutory obligation in
respect of any Contamination of the land on which the Premises are situate (the
“Land”) by Pollutants;

 

  (2)   those incurred in any Remediation pursuant to a statutory obligation in
respect of:

 

  A.   any contamination of properties adjoining the Land by; or

 

  B.   any exposure of such properties to;

 

Pollutants emanating from the Land;

 

  (3)   those incurred as a result of any claim in tort by any third party
concerning the presence of Pollutants:

 

  A.   in or on the Land; or

 

  B.   in or on any land and emanating from the Land;

 

where that presence presents a significant risk of harm to human health or the
environment;

 

  (4)   those incurred as a result of or in relation to any agreement between a
party and any owner or occupier of land which agreement:

 

  A.   concerns the presence of Pollutants in or on that land and emanating from
the Land where that presence presents a significant risk of harm to human health
or the environment; and

 

  B.   was reached following receipt by the party of a claim by the owner or
occupier;

 

  (5)   those incurred by way of fine or penalty on the party or any director or
manager of the party as a result of the presence of Pollutants in or on any
land.

 

“Pollutant” means a pollutant, contaminant, petroleum or petroleum product,
dangerous or toxic substance, hazardous substance, chemical, solid, special
liquid, industrial or other waste that is regulated in New South Wales in
connection with the protection of the environment or health and safety.

 

“Remediation” has the meaning given to the term in the Contaminated Land
Management Act 1997 (NSW).

 

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Environmental Indemnity

 

  (b)   Subject to paragraphs ((c)) and ((d)), the Lessor agrees to indemnify
and hold the Lessee harmless from and against all Environmental Costs.

 

Limitation

 

  (c)   The Lessor has liability under paragraph ((b)) only to the extent that
any Environmental Cost relates to Pollutants present in, under or on the Land or
any land before the Commencement Date or Pollutants which migrate onto the Land
before the Commencement Date.

 

No other Liability

 

  (d)   Except as provided by paragraphs ((b)) and ((c)), the Lessor has no
liability to the Lessee for losses, costs, liabilities, expenses and damages
incurred in relation to Pollutants on, in or under or in the vicinity of the
Land.

 

Environmental Indemnity by the Lessee

 

  (e)   Subject to paragraph ((f)) and ((g)), the Lessee agrees to indemnify and
hold the Lessor harmless from and against all Environmental Costs.

 

Limitation

 

  (f)   The Lessee has liability under paragraph ((e)) only to the extent that
any Environmental Cost relates to Pollutants which are present in, under or on
the Land or any land after the Commencement Date and which are so present as a
result of the occupation of the Land by the Lessee.

 

No other Liability

 

  (g)   Except as provided by paragraph ((e)) and ((f)), the Lessee has no
liability to the Lessor for losses, costs, liabilities, expenses and damages
incurred in relation to Pollutants on, in or under or in the vicinity of the
Land.

 

No Adverse Action

 

  (h)   Unless required to do so by law or where necessary to prevent or
minimise any injury to health, Lessee will not knowingly take any action after
Commencement Date which will or could affect Lessor’s liability under paragraph
((b)).

 

Procedure for Indemnification

 

  (i)   Without limiting clause 4.8((b)) of this Lease, the Lessee will
immediately inform Lessor and keep Lessor informed in writing giving full
details as

 

26

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for as reasonably practicable as soon as Lessee becomes aware of any actual or
potential Environmental Cost.

 

UST

 

  (j)   Notwithstanding anything to the contrary in paragraph ((h)), the Lessee
may, with the prior written approval of the Lessor,

 

  (1)   install; and

 

  (2)   use;

 

         underground fuel storage tanks at the Premises. The Lessor will not
unreasonably withhold such approval, and will not withhold such approval in
respect of any particular tank if the Lessee certifies in writing to the Lessor
that it has obtained all necessary consents and approvals (including development
consents) for the installation and use of the tank. The Lessee will install and
use any such tank(s) in accordance with all such consents and approvals. The
Lessee will, at no cost to the Lessor, carry out or cause to be carried out a
written report on the condition and suitability for use of each such tank
(including, but not limited to, its structural integrity) at intervals of not
less than three years from the Commencement Date. The Lessee will promptly
supply to the Lessor a copy of each such report. The Lessee will comply with any
duties imposed on it under section 60 of the Contaminated Land Management Act
1997 (NSW) in relation to the tank. The Lessee will comply at no cost to the
Lessor with all reasonable requests of the Lessor in relation to the tank and
arising from the report. Clause 5.6(j) is subject to the operation of clause
5.6(b) and does not limit the indemnity given by the Lessor under clause 5.6(b)

 

  5.7   Fitout Security Deposit

 

  (a)   The Lessee must pay to the Manager an amount of $5,000 as a security
deposit (“Security Deposit”) for the performance by the Lessee of its
obligations in relation to the fitting out of the Premises. The Security
Deposit:

 

  (1)   will be held by the Manager on behalf of the Lessee in accordance with
the provisions of this clause; and

 

  (2)   may be applied by the Lessor or the Manager to rectify any default of
the Lessee pursuant to sub-clause (b).

 

  (b)   Prior to occupation of the Premises by the Lessee, the Lessee must
attend a meeting with the Lessor and/or the Manager and at that meeting must
deliver to the Lessor or the Manager the following:

 

27

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  (1)   certificates and approvals from all relevant authorities authorising the
Lessee to occupy the Premises;

 

  (2)   certification (in a form reasonably acceptable to the Lessor) from a
contractor nominated or approved by the Lessor acting reasonably that all
services have been installed in the Premises in accordance with the requirements
of all relevant authorities and are compliant with the base building services;

 

  (3)   two sets (one being a sepia and paper copy and one being C.A.D. copy) of
all “as installed” drawings for all services in the Premises including without
limiting the generality air-conditioning air balance data and partition layout.
The C.A.D. copy must be provided as a 3.5” DOS floppy disk in the following
format (in descending order of preference):

 

  A.   Microstation DGN;

 

  B.   Autocad DWG; or

 

  C.   Autocad DXF; and

 

  (4)   copies of all services warranties, guarantees and contractual
maintenance obligation in relation to the fitout.

 

  (c)   The Security Deposit or so much thereof as has not been utilised by the
Lessor or the Manager pursuant to sub-clause (a)(2) will be refunded to the
Lessee on the first to occur of the following:

 

  (1)   the date the obligations of the Lessee in relation to the fitting out of
the Premises and in particular sub-clause (b) have been completed and satisfied;
and

 

  (2)   this Lease expires or is determined.

 

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6.   Insurance, Risk and Indemnity

 

  6.1   Lessee to effect Insurance policy

 

  (a)   The Lessee must effect and keep current:

 

  (1)   a public liability insurance policy for the Premises and the Car Park in
an amount not less than that in Item 11 (or any higher amount determined in good
faith by the Lessor and notified in writing to the Lessee) in respect of any
single claim; and

 

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  (2)   an industrial special risks policy in respect of the Lessee’s Equipment
for its full insurable value against all usual risks.

 

  (b)   Each insurance policy in sub-clause (a) must:

 

  (1)   be taken out in the name of the Lessee, note the Lessor as an insured
and insure each of their insurable interests,

 

  (2)   be effected with a reputable insurer approved by the Lessor,

 

  (3)   cover the risks and indemnities in clauses 6.3 and 6.4,

 

  (4)   note that it shall not lapse, terminate, vary or forfeit without at
least a month’s prior written notice to the Manager,

 

  (5)   bear endorsement that notice of any occurrence given by one insured is
deemed to be notice given by all insured parties and that breach of duty or
failure by one insured to observe the conditions of the policy does not
prejudice the rights of any other insured,

 

  (6)   provide that the insurer waives all claims against the Lessor, its
agents, contractors, employees and officers (except to the extent that the claim
being waived is caused by the negligence or wilful act or omission of the
Lessor, its agents, contractors, employees or officers), and

 

  (7)   conform with the Lessor’s reasonable requirements notified in writing to
the Lessee.

 

  (c)   The Lessee must deliver to the Lessor adequate written evidence of the
existence and contents of each policy immediately it is effected and of its
currency by each anniversary of the date in Item 6 and when reasonably required
by the Lessor.

 

  (d)   The Lessee must give the insurer full and true information of all
matters known to the Lessee (non-disclosure of which may prejudice the policy)
and do all things necessary to provide any information or evidence to enable the
Lessor to promptly recover any money due to the Lessor under any policy referred
to in this Lease.

 

  6.2   Lessee not to void insurances; extra premiums

 

  (a)   The Lessee must not cause the rate of any insurance premium relating to
the Premises or the Complex to be increased, or prejudice or render void or
voidable that insurance.

 

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  (b)   If the Lessor approves (in its absolute discretion) any request of the
Lessee whereby an insurable risk is increased, the Lessee must pay to it any
extra premiums due to the increased risk.

 

  6.3   Release of lessor and manager

 

The Lessee releases the Lessor and the Manager (and their respective agents,
contractors and employees) from all actions, claims, demands and Liabilities
arising from any damage, loss, death or injury occurring in the Complex or on
the Land or on any land adjacent to or adjoining the Land, except to the extent
that the same is caused by the negligence or wilful act or omission of the
person seeking to be released.

 

  6.4   Indemnities by lessee

 

Subject to clause 5.6(g) the Lessee indemnifies the Lessor and the Manager (and
their respective agents, contractors and employees) against all Liabilities
which the Lessor or the Manager (or their respective agents, contractors and
employees) suffers or incurs arising out of the Lessee’s Act or Omission, any
act or omission of any kind by any trespasser (while that trespasser is in the
Premises) or any Lessee’s Equipment.

 

  6.5   Any failure of services

 

  (a)   If any services provided by the Lessor or enjoyed by the Lessee in
conjunction with the Premises, the Complex or the Land (including, without
limit, the Lessor’s air-conditioning plant and equipment) malfunctions or fails
then, subject to sub-clause (b):

 

  (1)   the Lessor is not liable for any resulting Liabilities suffered or
incurred by the Lessee or the Lessee’s Agents,

 

  (2)   the Lessee is not entitled to determine this Lease and has no right of
abatement or set-off of Base Rent or other money, and

 

  (3)   the Lessee and the Lessee’s Agents have no claim for compensation or
damages against the Lessor.

 

  (b)   Despite sub-clause (a), where the Lessor’s air-conditioning plant and
equipment fails or malfunctions due to the Lessor’s failure to comply with
clause 2.4, the Lessee’s rights (if any) against the Lessor are in damages only.

 

  6.6   No liability for any losses caused by contractors

 

  Despite   any other provision in this Lease, the Lessor is not liable for:

 

30

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  (a)   failure by any security organisation to prevent any unauthorised entry
to the Complex or the Premises, or

 

  (b)   death, injury, loss or damage caused or contributed to by a contractor
(or its agents, employees or sub-contractors), where the organisation or
contractor has been engaged in good faith by or on behalf of the Lessor and the
Lessor reasonably believes it is reputable.

 

  6.7   Lessee’s obligations at own risk and expense

 

         Unless this Lease expressly provides otherwise in a particular
provision, any act, matter or thing which the Lessee is obliged, required or
permitted to do or effect under this Lease, the Lessee’s Equipment and the use
and occupation of the Premises by the Lessee are all at the sole risk, cost and
expense of the Lessee.

 

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7.   Lessor’s General Rights

 

  7.1   Lessor’s right to inspect and show premises

 

         The Lessor may at all reasonable times on reasonable notice and
accompanied by a representative of the Lessee if the Lessee offers to make a
representative available at a reasonable time enter the Premises:

 

  (a)   to inspect them to ascertain their repair, condition and value or to
determine if the Lessee is in breach,

 

  (b)   to show them to prospective purchasers of the Land or the Complex,

 

  (c)   to show them to prospective tenants during the last year of the Term
(unless the Lessee is then entitled to a lease of the Premises for a further
term) and during any holding over,

 

  (d)   to inspect them for the purpose of carrying out environmental audits,
and

 

  (e)   to inspect them for the purpose of carrying out investigations in
relation to possible Contamination.

 

In having access to the Premises under this clause 7.1 the Lessor must not
interfere with the Lessee’s use of the Premises more than is reasonably
necessary in the circumstances.

 

The obligation in this clause 7.1(a) for the Lessor to be accompanied by a
representative of the Lessee does not apply in the case of an emergency or where
the Lessee’s representative is not available at the appointed time.

 

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  7.2   Access for maintenance and authority requirements

 

  (a)   The Lessor may on reasonable notice and accompanied by a representative
of the Lessee if the Lessee offers to make a representative available at a
reasonable time enter the Premises with materials and equipment to:

 

  (1)   clean, install, inspect, change, maintain, repair, remove or use any
part of the Complex (other than the Premises) and the Lessor’s plant, equipment
and services in or adjacent to the Premises and the fabric or structure of the
Complex;

 

  (2)   carry out works consented to by the Lessee acting reasonably;

 

  (3)   carry out any maintenance or repairs to the Premises; and

 

  (4)   comply with any law, direction, notice, order, requirement or request
for which the Lessee is not liable under this Lease.

 

         The obligation in this clause 7.2(a) for the Lessor to be accompanied
by a representative of the Lessee does not apply in the case of an emergency or
where the Lessee’s representative is not available at the appointed time.

 

  (b)   Under sub-clause (a), the Lessor must not interfere with the Lessee’s
use of the Premises more than is reasonably necessary and must remove resulting
rubbish and leave the parts of the Premises used clean and in good condition.

 

  7.3   For sale notices

 

The Lessor may from time to time affix on the Complex and the Premises “For
Sale” and “For Lease” signs. The Lessee must not move, remove or alter any such
signs.

 

  7.4   Easements and rights of support

 

  (a)   The Lessor may grant rights of support or easements to or enter into any
agreement with any person interested in any land or improvement near the Land or
any authority, to provide services for or access to the Complex, the Land or
nearby land or to support any structure at any time on the Land or on nearby
land.

 

  (b)   Despite sub-clause (a), the Lessor must not without the Lessee’s written
consent enter into any agreement derogating substantially from the Lessee’s
rights in the Premises under this Lease. The Lessee and any Covenantor must (at
the Lessor’s request and at its reasonable cost) promptly withdraw any caveat
and execute any consents or other documents, to enable the Lessor to exercise
its rights under this clause.

 

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  7.5   Damage by lessee to the complex or land

 

The Lessor may make good any damage to the Complex or the Land caused or
contributed to by the Lessee’s Act or Omission where the Lessee has failed to
make good such damage within a reasonable time after notice from the Lessor
requiring it to do so and the Lessee must pay to the Lessor the cost of the
making good.

 

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8.   Transfer, Sub-Letting, Sale Of Shares Etc

 

  8.1   Transfer, sub-letting, sharing possession, etc

 

The Lessee must not transfer, sub-let, part with or share the possession of,
grant any licence affecting, or otherwise deal with or dispose of the Premises
(or any part of the Premises) or the Lessee’s interest under this Lease unless
the following provisions of this clause are satisfied:

 

  (a)   notice to lessor: the Lessee gives the Lessor not less than 14 day’s
prior notice of its desire to deal with the Premises, details of the parties,
documentation and other relevant circumstances;

 

  (b)   not used

 

  (c)   no default: the Lessee is not in default under this Lease;

 

  (d)   lessor’s requirements: the Lessee transfers, sub-leases or grants a
licence to:

 

  (1)   a transferee, sub-lessee or licensee who satisfies the Lessor acting
reasonably that:

 

  A.   he is a respectable, responsible and solvent person of comparable
financial standing to the Lessee, capable of performing the Lessee’s agreements
under this Lease, and

 

  B.   his proposed occupation and business would involve no higher security
risk to or loss of amenity within the Complex than the Lessee’s occupation and
business;

 

  (2)   a transferee who enters into a deed with the Lessor in the form
reasonably required by the Lessor (containing an agreement that he will perform
the Lessee’s agreements in this Lease) and who procures for the Lessor the
agreements, indemnities and bank and personal guarantees reasonably required by
the Lessor;

 

  (3)   a sub-lessee or licensee who enters into a deed with the Lessor
containing agreements reasonably required by the Lessor,

 

33

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including agreements that the Lessor’s consent to the sub-lease or licence is
without prejudice to its rights under this Lease, that the sub-lease or licence
immediately terminates on the termination of this Lease (unless the Lessor
otherwise determines) and that the sub-lessee or licensee must not grant a
sub-lease or licence or part with or share the possession of his premises or
transfer his sub-lease or licence;

 

  (e)   deed with lessor: the Lessee deals (other than by transfer, sub-lease or
licence) with a person who enters into a deed with the Lessor in the form and
containing the agreements, indemnities and guarantees reasonably required by the
Lessor;

 

  (f)   lessee pays lessor’s costs: the Lessee pays to the Manager within TEN
(10) Business Days of notice, the Lessor’s reasonable costs (including legal
costs) and disbursements of and incidental to the matters referred to in this
clause;

 

  (g)   lessor’s requirements on documentation: the Lessee, transferee,
sub-lessee, licensee and any other party to the transaction strictly comply with
the Lessor’s reasonable requirements in relation to drawing, stamping and
registering the transaction documentation; and

 

  (h)   sub-lease market rent: in the case of a sub-lease, the Lessee provides
to the Lessor a written acknowledgment that the rent payable pursuant to the
sub-lease is not a market rent.

 

  8.1A   Routine Sub-Leases

 

The Lessor acknowledges that it is the Lessee’s intention to operate the
Premises as a telehouse facility which involves the sub-leasing or licensing of
parts of the Premises to sub-tenants or licensees who wish to use the
telecommunication and other facilities offered by the Lessee in the Premises.
Clause 8.1 does not apply to a sub-lease or licence where:

 

  (a)   the Lessor has approved the form of the “standard” lease or licence upon
which the Lessee sub-leases or licences parts of the Premises pursuant to this
clause 8.1A;

 

  (b)   the terms and conditions of the relevant sub-lease or licence are
substantially those of the standard sub-lease or licence approved by the Lessor
under clause 8.1A(a);

 

  (c)   the sub-lease or licence terminates upon or prior to termination or
expiration of this Lease;

 

  (d)   the area to be sub-leased or licensed under any one particular sublease
or licence does not exceed 20% of the Gross Lettable Area (as determined in

 

34

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         accordance with the Property Council of Australia’s method of
measurement for Gross Lettable Area – March 1997) of the Premises; and

 

  (e)   the sub-tenant or licensee proposes to use the Premises for any of the
purposes referred to in this clause 8.1A.

 

  8.1B   Lessee released on assignment

 

Subject to clause 8.1C, if the Lessee assigns this Lease in accordance with the
requirements of clause 8.1 and the assignee furnishes a bond in accordance with
clause 11 to replace the bond provided on behalf of the Lessee, the Lessor and
the Lessee shall be deemed to have released each other from all further
obligations under this Lease and will each sign such documents and take such
other steps as may be reasonably required by the other to effect such release.
The Lessor must return any bond provided by the Lessee under clause 11 upon
receipt of a replacement bond provided by the assignee in accordance with clause
11.

 

  8.1C   Related corporations

 

The provisions of clause 8.1 do not apply to any transfer, subletting or other
dealing referred to in that clause where the transfer, subletting or other
dealing is to a company which is a related body corporate of the Lessee within
the meaning of the Corporations Law provided that such related body corporate
provides to the Lessor a bond in accordance with clause 11 to replace the bond
provided on behalf of the Lessee. The Lessor must return any bond provided by
the Lessee under clause 11 upon receipt of a replacement bond provided by the
related body corporate in accordance with clause 11. The Lessee shall not be
deemed to have been released from its obligations under this Lease pursuant to
clause 8.1B where the assignee is a related body corporate of the Lessee unless
the requirements of clause 8.1 are satisfied.

 

  8.2   Limits on mortgage of lease

 

  (a)   The Lessee must not charge, mortgage or encumber this Lease or the
interest of the Lessee under this Lease or in the Premises.

 

  (b)   Despite sub-clause (a), the Lessee may grant a mortgage or charge over
part or all of its assets and undertaking, provided that the mortgagee or
chargee first enters into a deed in the form the Lessor reasonably requires, and
the Lessee has paid the Lessor’s reasonable costs (including legal costs) and
expenses of and incidental to the deed.

 

  8.3   Sale of shares – default unless lessor’s requirements met

 

  (a)   Sub-clause (c) applies if the Lessee is a corporation whose shares are
not listed on the Australian Stock Exchange Limited’s official list or a foreign
company whose securities are not quoted for trading on a stock exchange or in a
public securities market.

 

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  (b)   In sub-clause (c):

 

  (1)   PrescribedRights means more than 49% of voting, income or capital
participation rights in the Lessee; and

 

  (2)   Transferor means any person or persons who beneficially hold or control
the Prescribed Rights (or more than 49% of voting, income or capital
participation rights in any other company or companies which beneficially hold
or control the Prescribed Rights) as at the date in Item 6 or, if this Lease has
been transferred to the Lessee, as at the transfer date.

 

  (c)   The Lessee is in default under this Lease if the Transferor transfers,
mortgages, charges (other than in accordance with clause 8.2(b)), grants any
option or other rights over, disposes of or ceases to be beneficially entitled
to the whole or any part of the Prescribed Rights, unless the following are
satisfied:

 

  (1)   notice: the Lessee gives the Lessor not less than a month’s prior notice
of its desire to deal with the Prescribed Rights;

 

  (2)   no default: the Lessee is not in default under this Lease;

 

  (3)   lessor’s requirements: the Transferor deals with the whole or part of
the Prescribed Rights to a person (Transferee) who:

 

  A.   satisfies the Lessor acting reasonably that the Transferee’s interest in
the Prescribed Rights involves no higher security risk to or loss of amenity in
the Complex than the Transferor’s interest in the Prescribed Rights; and

 

  B.   procures for the Lessor the agreements, indemnities and guarantees
reasonably required by the Lessor; and

 

  (4)   lessee pays lessor’s costs: the Lessee pays to the Manager within TEN
(10) Business Days of notice, the Lessor’s reasonable costs (including legal
costs) and disbursements of and incidental to the matters referred to in this
clause.

 

  (d)   Despite anything else in this clause 8.3, this clause 8.3 does not apply
where the Transferee is a related body corporate within the meaning of the
Corporations Law of the Lessee or the Transferor.

 

  8.4   Assignment and share transfer – costs and documents

 

         The Lessee must pay the Lessor’s reasonable costs (including legal
costs) and disbursements of and incidental to any proposed dealing under clauses
8.1 or 8.3,

 

36

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         even if the Lessee (or other party) does not comply with clauses 8.1 or
8.3 or if the proposed dealing does not proceed.

 

--------------------------------------------------------------------------------

 

9.   Termination And Yielding Up Of Premises

 

  9.1   Effect of resumption, destruction or damage

 

Clause 9.2 only applies if:

 

  (a)   the Premises or the Complex is resumed, or

 

  (b)   the whole or any part of the Complex is destroyed or damaged,

 

         so as to render the Premises during the Term inaccessible or
substantially unfit for the Lessee’s use and occupation, so as to deprive the
Lessee of use of a substantial part of the Premises during the Term or so as to
render the reconstruction of the Complex in its previous form impracticable or
undesirable in the Lessor’s opinion.

 

  9.2   Lease may be terminated without compensation; abatement

 

  (a)   In the circumstances in clause 9.1, this Lease may (subject to
sub-clause (c)) be terminated by notice by either Lessor or Lessee.

 

  (b)   No liability attaches to any party as a result of termination under this
clause, but the termination does not prejudice the Lessor’s and the Lessee’s
rights in respect of any prior breach or matter and does not limit any party’s
right to compensation from any resuming authority.

 

  (c)   When any damage or destruction in clause 9.1 occurs, the Lessee is only
entitled to terminate this Lease pursuant to sub-clause (a) if the Lessor fails
to rebuild or make the Premises accessible within a reasonable time (having
regard to the damage done and the work required) after the Lessee’s notice
requesting the Lessor to do so.

 

  (d)   Nothing in this Lease requires the Lessor to rebuild or make the
Premises accessible or fit for the Lessee’s use.

 

  (e)   When any damage or destruction in clause 9.1 occurs, the Base Rent and
the Lessee’s Proportion of Outgoings (or a proportionate part according to the
Lessor’s determination in good faith of the extent of the damage) will abate
until the Premises have been rebuilt or made accessible or fit for the Lessee’s
use or this Lease is terminated under this clause.

 

  (f)   Any dispute about the duration or extent of any abatement under
sub-clause (e) must be referred to the decision of a single expert nominated (at
the request of the Lessor or the Lessee) by the President of the API.

 

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  (g)   The expert must be a full member of the API with at least FIVE (5)
years’ practice as a registered valuer in New South Wales, must act as an expert
and not as an arbitrator, must make his determination promptly and must give
notice to the parties of his determination. The expert’s determination
(including as to payment of his costs) is final and binding (except for manifest
error).

 

  (h)   Until the dispute is determined, the Lessee must pay Base Rent and
Lessee’s Proportion of Outgoings in the amounts determined by the Lessor under
sub-clause (e). Within TEN (10) Business Days of the expert notifying the Lessor
and the Lessee of his determination, any necessary adjustment must be made
between the Lessee and the Lessor.

 

  9.3   Removal of lessee’s equipment

 

  (a)   Right/obligation to remove: The Lessee:

 

  (1)   may at any time prior to the expiration of this Lease, and

 

  (2)   must immediately prior to or at the expiration or surrender of this
Lease (or if this Lease is otherwise sooner determined, within TEN (10) Business
Days after the sooner determination),

 

         remove all Lessee’s Equipment from the Complex.

 

  (3)   Notwithstanding paragraphs (a)(1) and (2), immediately prior to or at
the expiration or surrender of this Lease, the Lessor can elect to require the
Lessee not to remove the Lessee’s Equipment (or any part of it). If the Lessor
so elects, the Lessee must not remove from the Premises the Lessee’s Equipment
(or any part of it) and such Lessee’s Equipment (or any part of it) becomes the
property of the Lessor. This paragraph does not apply in respect of items which
do not form an integral part of the Complex and which can readily be removed by
the Lessee and used elsewhere.

 

  (b)   Conditions applying to removal: Subject to paragraph (a)(3), in such
removal, the Lessee must:

 

  (1)   do no damage to the Complex (or immediately make good to the Lessor’s
satisfaction any damage caused in removing the Lessee’s Equipment),

 

  (2)   make good to the Lessor’s satisfaction any damage caused in affixing or
installing the Lessee’s Equipment,

 

  (3)   take proper steps to prevent damage and excess wear to all relevant
floors and floor coverings in the Complex,

 

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  (4)   remove all rubbish and leave the parts of the Complex used in removing
the Lessee’s Equipment clean and in good condition, and

 

  (5)   comply with the Lessor’s then usual reasonable conditions in respect of
removal and make good works.

 

  (c)   Lessor’s approval of certain removal works: The Lessee must have the
removal of the Lessee’s Equipment carried out by contractors approved by the
Lessor and in accordance with procedures approved by it.

 

  (d)   Lessee to submit details of removal work: The Lessee must submit details
of the proposed removal works for the Lessor’s approval not less than TWO (2)
months before the date in Item 7.

 

  (e)   Conditions applying to lessee’s entry if lease determined: The Lessee
and the Lessee’s Agents may only enter the Premises after the expiration or
sooner determination of this Lease to comply with this clause and clause 9.5.
Entry may only be effected during Established Complex Hours, with the Lessor’s
prior consent and on the basis that Part 6 and sub-clause (b) apply and that the
policies in clause 6.1(a) are current.

 

  9.4   Lessee’s equipment not removed

 

  (a)   If the Lessee does not remove and carry away the Lessee’s Equipment in
accordance with clause 9.3, then (subject to clause 9.6(b)) the interest of the
Lessee in the Lessee’s Equipment not removed immediately passes to the Lessor.

 

  (b)   Where the Lessee’s interest in any Lessee’s Equipment has passed to the
Lessor, the Lessor may leave the Lessee’s Equipment on the Premises or (at the
Lessee’s expense) remove and dispose of the equipment in any way the Lessor
thinks fit and repair any damage caused, at the Lessee’s cost.

 

  (c)   The Lessee indemnifies the Lessor against any Liabilities suffered or
incurred by the Lessor in respect of or arising out of sub-clauses (a) and (b).

 

  9.5   Premises to be in good condition on yielding up

 

  (a)   The Lessee must immediately on the expiration or sooner determination of
this Lease deliver back possession of the Premises to the Lessor clean and free
from rubbish and in good and substantial repair, order and condition in
accordance with the Lessee’s agreements for maintenance, repair and condition in
this Lease.

 

  (b)   Services means that part of the services and facilities (including
air-conditioning thermostats, ducts and outlets, fire sprinkler heads and
piping, fire hose reels and fire hydrants, security and fire alarm equipment,

 

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         lighting, central electrical switching arrangement, emergency lighting
and exit signs) provided or installed by or on behalf of the Lessor in the
Premises or for the benefit of the Premises in any floor of the Premises or in
any ceiling cavity or walls adjoining the Premises.

 

  (c)   Fitout/Occupation Date means the earlier of:

 

  (1)   the date on which possession of the Premises was first granted (whether
under this Lease or otherwise) to the Lessee or the Lessee’s Predecessors, and

 

  (2)   the date of commencement of the first fit out of the Premises by or on
behalf of the Lessee’s Predecessors or the Lessee.

 

  (d)   The Lessee must put all the Services into the same good repair, order
and condition as existed prior to the Fitout/Occupation Date.

 

  (e)   Without limiting or being limited by sub-clauses (a) and (d), the Lessee
must:

 

  (1)   replace services: put all the Services into either the same positions as
existed prior to the Fitout/Occupation Date or (if required by the Lessor) into
such other positions as are notified in writing by the Lessor, provided that the
cost to the Lessee of putting the Services in the other positions must not be
greater than the cost (estimated by the Lessor, in good faith) of putting the
Services into the positions which existed prior to the Fitout/Occupation Date.
The Lessee’s obligation includes installing new cables, conduits, wires,
ducting, piping and pipes (of a standard not less than that then existing) to
link up the Services so that they are operational once in the required
positions.

 

  (2)   remove cables: remove all cables, conduits, wires, ducting, piping and
pipes in or servicing the Premises installed by or on behalf of the Lessee or
the Lessee’s Predecessors (or any sub-lessee or licensee of any of them), other
than those necessary for the Services to be operational after the Lessee has
complied with paragraph (1).

 

  (3)   remove partitions: remove all partitions and intra-tenancy walls
installed by or on behalf of the Lessee or the Lessee’s Predecessors (or any
sub-lessee or licensee of any of them).

 

  (4)   re-balance air-conditioning: following the removal of all of the
Lessee’s Equipment, partitions and intra-tenancy walls, re-balance the
air-conditioning plant and equipment exclusively serving the Premises as
appropriate to the then relevant standard to service the Premises with an
open-plan layout.

 

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  (5)   reinstate holes in structure: make good and reinstate the structure of
any part of the Complex into which any hole has been made by or on behalf of the
Lessee, the Lessee’s Agents or any of the Lessee’s Predecessors.

 

  (6)   repair/replace ceiling tiles: either put the ceiling tiles into good and
substantial repair, order and condition (fair wear and tear excepted) or replace
the ceiling tiles (or such of the ceiling tiles that cannot be repaired) with
new ceiling tiles approved by the Lessor of a standard not less than that of the
ceiling tiles then provided by the Lessor to premises in the Complex.

 

  (7)   repair carpet: either put the carpet into good and substantial repair,
order and condition (including replacing to the Lessor’s satisfaction all areas
cut out) or replace that carpet with new carpet approved by the Lessor of a
standard not less than that of the carpet then provided by the Lessor to
premises in the Complex.

 

  (8)   shampoo carpet: have the carpet shampoo cleaned by a reputable
contractor.

 

         Clauses 9.5(e)(1)(3) and (4) do not apply if and to the extent that
partitions and intra-tenancy walls installed by or on behalf of the Lessee or
the Lessee’s Predecessors (or any sub-lessee or licensee of any of them) will be
used by the Lessor or a person who has entered into an agreement for lease or
lease of the Premises from the Lessor.

 

  (f)   Nothing in this clause imposes any obligation on the Lessee to make good
any damage caused by reasonable wear and tear, explosion, earthquake, aircraft
or other aerial device, civil commotion, fire, flood, lightning, riot, storm,
tempest, act of God or war.

 

  (g)   The Lessee must immediately repair any damage to the Complex arising out
of any Lessee’s Act or Omission under this clause. However, this sub-clause does
not limit the Lessor’s right under clause 7.6 to make good damage.

 

  9.6   Not Used

 

  9.7   Application of clauses 9.3 to 9.6

 

  (a)   If the Lessee has entered into or is legally entitled to a lease of the
whole of the Premises for a further term after the expiration of this Lease,
then clauses 9.3 to 9.6 (inclusive) do not apply to the extent that they relate
to rights of the Lessor or obligations of the Lessee at or about the expiration
of this Lease.

 

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  (b)   Clauses 9.3 and 9.4 do not apply to any Lessee’s Equipment transferred
(with the Lessor’s prior approval) to the Lessor or to a person who has entered
into an agreement for lease or lease with the Lessor or to some recognised
financial institution allowing its use by the person (provided that clause 5.4
has been complied with).

 

  (c)   Without limiting the continuing effect of any other provisions, clauses
9.3 to 9.6 (inclusive) continue to operate if this Lease expires or is
terminated.

 

  9.8   Holding over – monthly; lessee to apply for approval

 

  (a)   Subject to sub-clause (b), the Lessee must vacate the Premises at the
expiration of the date in Item 7.

 

  (b)   With the Lessor’s prior approval (given or withheld in its absolute
discretion), the Lessee may continue to occupy the Premises beyond the date in
Item 7. Such occupation is for a fixed term of ONE (1) month and then from month
to month, on the provisions of this Lease (so far as applicable) and at a
monthly rent which is a monthly proportion of the sum of the Base Rent current
on the date in Item 7 and the Lessee’s Proportion of Outgoings.

 

  (c)   Without limiting clause 10.2, the tenancy in sub-clause (b) is
determinable at any time by the Lessor or the Lessee by ONE (1) month’s notice
expiring on any day.

 

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10.   Default And Re-Entry

 

  10.1   Lessor’s right to remedy defaults

 

  (a)   If the Lessee fails to pay, do or effect anything in accordance with
this Lease, the Lessor may (after notice to the Lessee specifying the default,
except where the Lessor perceives an emergency, when no notice is required) pay,
do or effect the thing as if it were the Lessee and at the Lessee’s cost. This
clause does not affect the Lessor’s other rights and remedies.

 

  (b)   The Lessor may enter and remain on the Premises to do or effect anything
referred to in sub-clause (a) and the Lessee must pay to the Lessor the Lessor’s
costs and expenses incurred or paid in doing or effecting that thing.

 

  10.2   Default or breach by lessee – re-entry

 

         The Lessor may re-enter the Premises without prior notice or demand if:

 

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  (a)   any money payable by the Lessee to the Lessor under this Lease is not
paid within TEN (10) Business Days of the due date, or

 

  (b)   the Lessee breaches any provision of this Lease and, where the breach is
capable of remedy, it has not been remedied to the Lessor’s reasonable
satisfaction within a reasonable time after service of notice on the Lessee
specifying the breach and, where the breach is not capable of remedy, but the
Lessor can reasonably be compensated for any damage suffered as a result of such
breach, the Lessee has not within a reasonable time after service of notice on
the Lessee specifying the breach, offered to pay such reasonable compensation to
the Lessor, or

 

  (c)   an order is made or a resolution is effectively passed for winding up
the Lessee or any Covenantor (being a corporation) or any act or event mentioned
in Section 461(a)-(k) of the Corporations Law occurs in relation to the
corporation.

 

         Upon re-entry this Lease is determined. This clause is without
prejudice to any claim or other remedy which the Lessor has or may have against
the Lessee or any Covenantor in respect of any breach of this Lease. This clause
has effect despite any other provision in this Lease.

 

  10.3   Damages claimable by lessor

 

  (a)   If an event referred to in clause 10.2(a) or (b) occurs, the Lessee is
in breach of a fundamental and essential term of this Lease.

 

  (b)   In addition to the Lessor’s other rights and remedies, where the Lessor
has re-entered the Premises pursuant to clause 10.2 or the Lessor accepts the
Lessee’s repudiation of this Lease, the Lessee shall be liable to the Lessor in
damages for the Lessee’s breach of the Lease.

 

  (c)   This clause does not limit any right of the Lessor to recover damages
for any other loss. The Lessor’s right to recover damages is not affected by the
Lessor’s acceptance of the Lessee’s repudiation or by the parties’ conduct
constituting a surrender by operation of law.

 

  10.4   No waiver

 

  (a)   Failure to exercise, delayed exercise or partial exercise of any
available remedy or right does not waive any breach by a party.

 

  (b)   Waiver by a party of a particular breach is not a waiver of any other
breach or default.

 

  (c)   Demand or acceptance by the Lessor of money payable under this Lease
after the Lessee’s breach or default does not prejudice any other right or
remedy of the Lessor.

 

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11.   Bank Bond/Guarantee

 

  11.1.   Lessee to obtain unconditional bank bond

 

  (a)   On or by the date in Item 6, the Lessee must obtain and deliver to the
Lessor an enforceable and irrevocable bond in favour of the Lessor (and its
successors and assigns) given by an Australian domiciled bank carrying on
business in Sydney (Bank) under which the Bank undertakes unconditionally on
terms satisfactory to the Lessor to pay to the Lessor on demand any sum up to an
aggregate of the Guaranteed Sum.

 

  (b)   If a payment is made to the Lessor after a demand under clause 11.2, the
Lessee must within TEN (10) Business Days of being notified by the Lessor,
obtain and deliver to the Lessor a further bond for the amount necessary to
ensure that a bond or bonds are maintained which secure the Guaranteed Sum to
the Lessor. The bond or bonds must not specify an expiry date.

 

  (c)   Guaranteed Sum means the amount (if any) specified in Item 15 together
with the amount of any further bond required to be obtained under clause 11.4.

 

  11.2.   Bond available to meet lessee’s breaches

 

  (a)   The Guaranteed Sum (or any part of it, as determined by the Lessor but
not exceeding, in aggregate, the Guaranteed Sum) is payable on the Lessor’s
demand. The Lessor may not make demand until the Lessee breaches this Lease and
the Lessor has suffered loss as a result. The amount demanded by the Lessor must
not exceed the Lessor’s reasonable estimate of the amount of that loss.

 

  (b)   The Lessee irrevocably agrees that the Bank must act immediately on the
Lessor’s demand, without reference to the Lessee and even if the Lessee has
instructed the Bank not to pay the Lessor.

 

  (c)   Acceptance of the bond or payment under it does not limit the Lessor’s
rights or waive any breach by the Lessee.

 

  11.3.   Duration of bond

 

  The   bond must continue in force until the earliest of:

 

  (a)   payment to the Lessor by the Bank of the whole of the amount secured by
the bond; or

 

  (b)   the receipt by the Bank of either a notice from the Lessor that the bond
is no longer required or the bond (returned with the Lessor’s consent).

 

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  11.4.   Further bond on base rent increases

 

  (a)   If the Base Rent is increased during the Term, the Guaranteed Sum
automatically increases by the same proportion as the increase in the Base Rent
(rounded up to the nearest dollar).

 

  (b)   Within TEN (10) Business Days of the Guaranteed Sum increasing, the
Lessee must obtain and deliver to the Lessor a further bond complying with
clause 11.1 for the amount necessary to ensure that a bond or bonds are
maintained which secure the then current Guaranteed Sum to the Lessor.

 

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12.   Covenantor

 

  12.1.   Covenant – joint and several liability

 

In consideration of the Lessor’s entry into this Lease at the Covenantor’s
request (or for other valuable consideration given by the Lessor), the
Covenantor unconditionally and irrevocably agrees that it is liable to the
Lessor for the Lessee’s obligations to the Lessor under or arising out of this
Lease. Each Covenantor is liable individually and collectively with the Lessee
and each other Covenantor to the Lessor.

 

  12.2.   Indemnities

 

  (a)   The Covenantor indemnifies the Lessor against all Liabilities the Lessor
suffers or incurs if the Lessee fails to comply with this Lease, if any
provision of this Lease is not enforceable by the Lessor or if this Lease is
disclaimed by the Lessee’s liquidator or trustee in bankruptcy.

 

  (b)   No disclaimer relieves the Covenantor of its obligations under this
indemnity. Each indemnity survives any termination of this Lease.

 

  12.3.   Principal obligations

 

  (a)   The obligations of each Covenantor under this Lease are principal
obligations and are not collateral or secondary to any other obligations
(including those of the Lessee) and are not affected by any bond, guarantee,
indemnity, judgment security or right (Security) which the Lessor may hold at
any time in respect of the Lessee’s liability.

 

  (b)   The Lessor need not realise for the benefit of the Covenantor any
Security held by the Lessor in respect of the Lessee or any funds or assets that
the Lessor may be entitled to receive or claim on.

 

  (c)   The Lessor may vary, exchange, renew, release or refuse to complete or
to enforce any Security held by the Lessor.

 

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  12.4.   Continuing liability of covenantor

 

Each Covenantor’s liability under this Lease is a continuing liability and is
not affected by any act, matter or thing (whether or not done with the
Covenantor’s consent) including, without limit:

 

  (a)   expiration or termination (including by re-entry) of this Lease;

 

  (b)   the death, bankruptcy, assignment for the benefit of creditors,
arrangement with creditors, winding-up, reconstruction, administration,
receivership, liquidation, striking off or other incapacity of the Lessee or any
other Covenantor;

 

  (c)   the Lessor becoming a party to or bound by any compromise, assignment of
property, scheme of arrangement, composition of debts or scheme of
reconstruction relating to the Lessee, any other Covenantor or any other person;

 

  (d)   the grant of time, credit or other indulgence to the Lessee, the
Covenantor or any other person;

 

  (e)   the whole or partial release or discharge of the Lessee or any other
Covenantor from any obligation;

 

  (f)   any transaction, arrangement or agreement in respect of this Lease or
otherwise between any of the parties or with any other person;

 

  (g)   the Lessor failing to exercise, waiving or deferring any or all of its
powers, rights or remedies under this Lease;

 

  (h)   any act or omission contrary to the Covenantor’s interests by the Lessor
or any other person or any failure to give effective notice of any breach of
this Lease;

 

  (i)   obtaining any judgment or order against any party;

 

  (j)   any actual or alleged set-off, defence, counter-claim or other deduction
on the part of the Lessee or any Covenantor;

 

  (k)   any payment made to the Lessor and later avoided;

 

  (l)   any rent review or increase in amounts payable by the Lessee under this
Lease, any variation of this Lease, any holding over, any consent or approval
given by the Lessor pursuant to this Lease or any transfer or other dealing in
respect of this Lease; or

 

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  (m)   any other act, default, delay, event, mistake or omission of the Lessor
or any other person whereby the Covenantor’s liability to the Lessor would, but
for this clause, have been affected.

 

  12.5.   Assignment of benefit of covenant

 

  (a)   The Lessor may transfer the benefit of the Covenantor’s agreements to
any transferee of the Lessor’s interest in the Land, this Lease or the reversion
of this Lease.

 

  (b)   Such transfer in no way affects the Covenantor’s agreements under this
Lease which shall then be to the transferee (or in the case of a partial
transfer, to the Lessor and the transferee).

 

  (c)   The Covenantor must (if requested by the Lessor and at its reasonable
expense) promptly enter into a deed with any transferee from the Lessor in terms
substantially similar to this Part.

 

  12.6.   No proof in estate of lessee in competition with lessor

 

  (a)   If any bankruptcy, assignment for the benefit of creditors, arrangement
with creditors, winding-up, liquidation, receivership or other demise of the
Lessee (Demise) results in claims by creditors, the Covenantor must not prove or
claim in competition with the Lessor so as to diminish any distribution,
dividend or payment which (but for such claim) the Lessor would be entitled to
receive arising out of the Demise.

 

  (b)   Despite sub-clause (a), the Covenantor must, if required by the Lessor,
prove or claim in the Demise, and any amount received by the Covenantor from any
distribution, dividend or payment will be received and held by the Covenantor in
trust for the Lessor and must be paid to the Lessor on demand in reduction of
the amount owing to the Lessor by the Lessee or the Covenantor.

 

  12.7.   Warranties by covenantor

 

  Each   Covenantor which is a corporation or trustee warrants that:

 

  (a)   it has full and unrestricted power and authority to agree and indemnify
as provided in this Lease and to execute this Lease, and

 

  (b)   its entry into this Lease is part of the proper administration or
purposes of the corporation or trust and is for the commercial benefit of the
corporation or trust.

 

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  12.8.   Covenantor to pay lessor’s costs

 

The Covenantor must pay within TEN (10) Business Days of written demand the
Lessor’s reasonable legal and other expenses (on an indemnity basis) incurred in
the exercise or attempted exercise of any power, remedy or right conferred on
the Lessor by this Part.

 

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13.   Option for Further Term

 

  13.1.   Right to lease for further term

 

If a further term is set out in Item 8, the Lessee may lease the whole of the
Premises for the Further Term subject to this Part.

 

  13.2.   Conditions for grant of further term

 

  (a)   The Lessor must grant to the Lessee and the Lessee must take a lease of
the whole of the Premises for the Further Term at an initial Base Rent
determined under clause 13.3, provided that all the following are satisfied:

 

  (1)   notice: the Lessee serves on the Lessor not more than TWELVE (12) months
and not less than NINE (9) months before the Termination Date a notice
requesting the grant of the lease for the Further Term (“Lessee’s Notice”);

 

  (2)   payments punctually made: the Rent and other money payable to the Lessor
under this Lease have been duly and punctually paid;

 

  (3)   no breach: the Lessee has not persistently been in breach of this Lease
during its Term (whether or not the Lessee is in breach of this Lease at the
date of service of the Lessee’s Notice or at any subsequent time during the
Term); and

 

  (4)   occupation: the Lessee occupies the Premises at the Termination Date.

 

  (b)   If the Lessor does not intend to grant to the Lessee the lease for the
Further Term due to any breach of this Lease by the Lessee of which the Lessor
is aware at the date of service of the Lessee’s Notice, the Lessor must serve on
the Lessee within FOURTEEN (14) days of receipt of the Lessee’s Notice, a notice
as required under section 133E of the Conveyancing Act specifying the Lessee’s
breach.

 

  13.3.   Initial base rent

 

  (a)   If the New Lease Commencement Date is a Review Date:

 

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  (1)   The initial Base Rent is the amount agreed or determined as the Current
Base Rent as at the New Lease Commencement Date.

 

  (2)   The Base Rent agreed or determined must not be less than the Base Rent
current at the Termination Date.

 

  (3)   If the Base Rent has not been agreed or determined by the New Lease
Commencement Date, the Base Rent notified by the Lessor to the Lessee pursuant
to clause 2 of Schedule 2 shall apply unless and until there is an agreement or
determination to the contrary pursuant to Schedule 2.

 

  (b)   If the New Lease Commencement Date is not a Review Date, the initial
Base Rent is the Base Rent current at the Termination Date.

 

  13.4.   Terms of further lease

 

  (a)   Subject to this Pan, the lease for the Further Term must contain the
provisions of this Lease, except that the Lessor may require any provision to be
amended or added in the further lease to reflect changes in the improvements
comprising the Complex or its management or otherwise to incorporate provisions
which the Lessor would in the first instance require (in good faith) from any
prospective lessee if the Lessee had not exercised its right to the lease for
the Further Term.

 

  (b)   The relevant parts of the reference schedule of the lease for the
Further Term must be completed appropriately having regard to:

 

  (1)   the criteria for adjustment of public liability insurance under clause
6.1(a); and

 

  (2)   the current name, residential address and occupation or registered
office (as the case may require) of the Covenantor (if any).

 

  (c)   The further lease must contain a right for a further lease(s) for the
further term(s) (if any) set out in the remaining applicable paragraph(s) in
Item 8 in terms similar to this Part except that any lease for the last of the
further terms must not contain this Part.

 

  13.5.   Execution of further lease

 

The Lessee and the Covenantor (if any) must execute the lease for the Further
Term and return it to the Manager within ONE (1) month of receipt of the lease
by the Lessee.

 

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  13.6.   Bond on grant of further term

 

  (a)   This clause applies if a lease for the Further Term is granted under
this Part and a bond is required under this Lease at the Termination Date.

 

  (b)   The Lessee must obtain and deliver to the Lessor an enforceable and
irrevocable bond in favour of the Lessor (and its successors and assigns) and
otherwise complying with clause 11.1(a). The bond must be expressed to apply
from the New Lease Commencement Date to the date THREE (3) months after the date
of expiration of the Further Term.

 

  (c)   On and from the New Lease Commencement Date, the initial “Guaranteed
Sum” means the greater of the Guaranteed Sum current at the Termination Date and
the Guaranteed Proportion of the initial Base Rent for the Further Term (agreed
or determined under clause 13.3). The “Guaranteed Proportion” is the proportion
obtained by dividing the number set out in Item l5(b) by 12 and multiplying the
result by l00. The Guaranteed Sum determined in accordance with this clause must
be inserted in the relevant item of the reference schedule of the lease for the
Further Term.

 

  (d)   The fresh bond must be delivered to the Lessor no later than TEN (10)
Business Days after the later of the New Lease Commencement Date and the date on
which the initial Base Rent for the Further Term is agreed or determined.

 

  (e)   Despite sub-clauses (b) to (d), if the initial Base Rent for the Further
Term has not been agreed or determined by the New Lease Commencement Date, then
the Lessee must obtain and deliver to the Lessor on or by the New Lease
Commencement Date an enforceable and irrevocable bond in favour of the Lessor
(and its successors and assigns) for the Guaranteed Sum current at the
Termination Date and otherwise complying with clause 11.1(8). The bond must be
expressed to apply from the New Lease Commencement Date to the date THREE (3)
months after the date of expiration of the Further Term.

 

  (f)   The Lessor must return to the Lessee the bond provided under sub-clause
(e) on receipt of the bond provided under sub-clauses (b) to (d).

 

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14.   Limited recourse against responsibility entity: Lend Lease Real Estate
Investments Limited

 

  (a)   “Responsible Entity” means Lend Lease Real Estate Investments Limited
(as responsible entity and trustee of the registered managed investment scheme
known as Australian Prime Property Fund Industrial).

 

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  (b)   The Responsible Entity enters into this Lease only in its capacity as
trustee of the Australian Prime Property Fund Industrial (the “Scheme”) and in
no other capacity. A liability arising under or in connection with this Lease is
limited to and can be enforced against the Responsible Entity only to the extent
to which it can be satisfied out of property of the Scheme out of which the
Responsible Entity is actually indemnified for the liability. This limitation of
the Responsible Entity’s liability applies despite any other provision of this
Lease and extends to all liabilities and obligations of the Responsible Entity
in any way connected with any representation, warranty, conduct, omission,
agreement or transaction related to this Lease.

 

  (c)   The parties, other than the Responsible Entity, may not sue the
Responsible Entity in any capacity other than as trustee of the Scheme,
including seeking the appointment of a receiver (except in relation to property
of the Scheme), a liquidator, an administrator or any similar person to the
Responsible Entity or prove in any liquidation, administration or arrangement of
or affecting the Responsible Entity (except in relation to property of the
Scheme).

 

  (d)   The provisions of this clause shall not apply to any obligation or
liability of the Responsible Entity to the extent that it is not satisfied
because under the constitution establishing the Scheme or by operation of law
there is a reduction in the extent of the Responsible Entity’s indemnification
out of the assets of the Scheme, as a result of the Responsible Entity’s fraud,
negligence or breach of trust.

 

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Schedule 1 – Particulars of Outgoings

 

SECTION A – OUTGOINGS

 

Outgoings include (without limit):

 

1   Rates and Taxes

 

Rates and taxes (including land tax, calculated on the taxable value of the Land
on a single holding basis, but excluding the Lessor’s income tax or capital
gains tax), assessments and charges (including charges for water and sewerage
usage, drainage, trade waste and fire services), fees and levies and impositions
and duties of any authority, body, department, government or instrumentality
assessed, charged, imposed or levied in respect of the Complex, the Land or
services to the Complex or the Land (regardless of ownership) or assessed,
charged, imposed or levied in connection with the management or operation of the
Complex or the Land and bank charges incurred in connection with the management
and operation of the Complex (including bank debits tax).

 

2   Insurance

 

Insurance premiums, stamp duty and brokers fees for:

 

  (a)   insurance of the Complex (but not to the extent that such insurance
exceeds its full insurable reinstatement value),

 

  (b)   insurance of the Complex and the Lessor and the Manager against other
risks relating to the Lessor’s interest in the Complex as the Lessor deems
necessary or desirable (including public liability, consequential and economic
loss, machinery breakdown and any other insurance incidental to ownership,
repair, maintenance, management and security of the Complex and the Land (or
either of them)), and

 

  (c)   workers compensation insurance for people performing functions in
relation to the Complex (where applicable, adjusted to reflect the proportion of
time spent in relation to the Complex and to other activities).

 

3   Repairs and maintenance

 

Costs of maintaining and repairing (including repair by replacement of parts)
the following in or of the Complex or the Land including but not limited to:

 

  (a)   air-conditioning plant and equipment, sprinkler and fire alarm
installations, fire fighting equipment and security systems,

 

  (b)   mechanical, hydraulic, electrical and electronic equipment,

 

  (c)   toilets, basins, taps, sanitary stacks, fountains, pipes, plumbing,
grease traps and associated appurtenances,

 

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  (d)   switches, outlets, lights, conduits, wiring and other electrical
appurtenances, and

 

  (e)   Common Areas, plant rooms, cleaners’ rooms, security or fire control
rooms, service ducts and risers (and fixtures, fittings and furnishings in them)
(including painting them).

 

4   Cleaning and other costs

 

Costs for cleaning all interior and exterior surfaces of windows in the Complex,
the surface of the facade of the Complex and the items in clauses 3(c) and (e)
of Section A of this Schedule, and costs in respect of:

 

  (a)   toilet and washroom requisites in the Complex,

 

  (b)   landscaping, planting, weeding and maintaining any gardens, lawns,
plants and flowers in Common Areas,

 

  (c)   any licence or permit for disposal of waste from the Complex, and

 

  (d)   removing graffiti from the Complex.

 

5   Services

 

Costs in respect of:

 

  (a)   liquid waste removal, garbage removal, excess water charges and similar
services not within clause 1 of Section A,

 

  (b)   security, control, tenant liaison services or operations management
services for the Complex,

 

  (c)   control of pests in Common Areas and any safety or environmental audits
for the Complex,

 

  (d)   the auditor’s certificate pursuant to clause 3.3(b)(2),

 

  (e)   annual environmental, risk, fire and essential services audits
undertaken in respect of the Complex, and

 

  (f)   all other services provided in respect of the Complex and the Land (or
either of them).

 

6   Management

 

A management fee or charge to cover the Lessor’s cost of having the Complex and
the Land managed, which must not exceed the actual management fee or charge paid
or payable by the Lessor to the Manager.

 

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7   Energy costs

 

All costs for electricity, gas, oil and any other source or type of energy,
power or fuel in respect of the Complex or the Land.

 

SECTION B – APPORTIONMENT OF OUTGOINGS

 

1   Where an amount included in Outgoings does not relate to the whole of the
Land, the Lessee’s Proportion of that amount is the amount calculated as
follows:

 

A%  =

 

B x 100

    C

 

where:

 

A  =

  

the Lessee’s Proportion referred to in this clause;

B  =

  

the Area; and

C  =

  

the total gross lettable area of that part of the Complex to which the amount
relates, measured in accordance with the principles for measurement of gross
lettable area as published in the PCA publication “Method of Measurement for
Lettable Area” (1997 Revision).

 

2   This section applies despite any other provision of this Lease.

 

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Schedule 2 – Reviews of Base Rent

 

1   Interpretation and time to be of the essence

 

  (a)   In this Schedule:

 

  (1)   unless the context otherwise requires a reference to a clause is a
reference to a clause in this Schedule.

 

  (2)   time is of the essence. Failure to observe any time limit in this
Schedule is a failure to discharge the relevant obligation or exercise the
relevant right.

 

  (b)   When agreed or determined in accordance with this Schedule, the Current
Base Rent is binding on the parties to this Lease.

 

2   Reviews of base rent – lessor’s notice

 

  (a)   The Lessor may at any time in the period commencing THREE (3) months
before a Review Date and expiring on the next Review Date (or, if there is no
following Review Date, the expiration of the Term), serve on the Lessee a notice
reviewing the Base Rent to an amount which the Lessor determines to be the
annual market rent of the Premises as at the subject Review Date.

 

  (b)   The amount notified in the Lessor’s Notice is the Base Rent on and from
the subject Review Date unless and until there is agreement or a determination
to the contrary pursuant to this Schedule, at which time the agreed or
determined amount will become the Base Rent payable on and from the subject
Review Date.

 

  (c)   Despite sub-clause (b), if the Lessee serves notice in accordance with
clause 4, then (on an interim basis) the Base Rent on and from the subject
Review Date will be the greater of the Base Rent current immediately prior to
the subject Review Date and NINETY per cent (90%) of the amount notified in the
Lessor’s Notice.

 

  (d)   The Lessee must pay that interim Base Rent until there is written
agreement or a determination to the contrary under this Schedule.

 

  (e)   The Lessor’s Notice is binding on the parties (except in the case of
manifest typographical error). Except as provided in clause 4, it must not be
challenged due to any failure (or alleged failure) by the Lessor to have proper
regard to the Criteria or due to any other reason.

 

3   Essential qualifications of valuer

 

  (a)   Each Valuer must be a person who is a full member of the API at all
times during his appointment under this Lease and who has (at the date of his
appointment) not less than FIVE (5) years practice as a registered valuer
valuing industrial premises in the Sydney metropolitan area. Any purported
appointment as a Valuer of a person not so qualified is ineffective.

 

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  (b)   In agreeing or determining the Current Base Rent, each Valuer must act
as an expert and not as an arbitrator. Any laws relating to arbitration do not
apply.

 

4   Dispute by Lessee of reviewed amount – lessee’s notice

 

If, within FIFTEEN (15) Business Days after service of the Lessor’s Notice, the
Lessee serves on the Lessor a notice disputing that the amount notified in the
Lessor’s Notice is the Current Base Rent and setting out the amount which the
Lessee considers to be the Current Base Rent, then the Lessor and the Lessee
must try to agree the Current Base Rent within TEN (10) Business Days after
service of the Lessee’s Notice.

 

5   Lessee and lessor to endeavour to agree on valuer

 

If the Current Base Rent is not agreed under clause 4, the Lessor and the Lessee
must try (within TWENTY (20) Business Days after service of the Lessee’s Notice)
to agree on the Valuer to be appointed to determine the Current Base Rent.

 

6   Effect of failure to agree on valuer

 

  (a)   If the Current Base Rent is not agreed under clause 4 and the Lessor and
the Lessee do not agree (within TWENTY (20) Business Days after service of the
Lessee’s Notice) on the Valuer to be appointed to determine the Current Base
Rent, either the Lessor or the Lessee may request the President of the API to
promptly appoint (on behalf of the Lessor and the Lessee) a Valuer to determine
the Current Base Rent within TWENTY (20) Business Days of his appointment date
and to promptly notify the Lessor and the Lessee by notice of the amount
determined and the reasons for the determination.

 

  (b)   The President of the API must promptly notify the Lessor and the Lessee
of the Valuer’s appointment and his appointment date.

 

  (c)   If a Valuer appointed under this clause does not, within TWENTY (20)
Business Days of his appointment date, comply with both of the following:

 

  (1)   determine the current Base Rent; and

 

  (2)   notify the Lessor and the Lessee by notice of the amount determined and
the reasons for the determination,

 

then either the Lessor or the Lessee may request a further appointment under
this clause.

 

7   Adjustment of base rent once agreed or determined

 

  (a)   If the Current Base Rent agreed or determined exceeds the interim Base
Rent payable under clause 2(c), the Lessee must pay to the Lessor, within TWENTY
(20) Business Days of the agreement or determination:

 

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  (1)   the difference between the Current Base Rent from the subject Review
Date and the interim Base Rent paid since the subject Review Date; and

 

  (2)   interest on the difference, being TWO per cent (2%) more than the
Westpac Indicator Lending Rate quoted on the day the Current Base Rent is agreed
or determined, calculated daily on that part of the difference which would have
been paid by the Lessee from time to time (if the amount agreed or determined
had been the amount paid from the subject Review Date) and computed up to and
including the day the Lessee pays the difference to the Lessor.

 

  (b)   If the Current Base Rent agreed or determined is less than the interim
Base Rent payable under clause 2(c), the Lessor must pay to the Lessee, within
TWENTY (20) Business Days of the agreement or determination:

 

  (1)   the difference between the interim Base Rent paid since the subject
Review Date and the Current Base Rent from the subject Review Date; and

 

  (2)   interest on the difference, being TWO per cent (2%) more than the
Westpac Indicator Lending Rate quoted on the day the Current Base Rent is agreed
or determined, calculated daily on the additional amounts as they were paid to
the Lessor and computed up to and including the day the Lessor pays the
difference to the Lessee.

 

  (c)   Notwithstanding any other provision of this Lease, the Current Base Rent
determined in accordance with this Schedule must not exceed an amount equivalent
to the Base Rent payable immediately prior to the subject Review Date increased
by twenty per cent (20%).

 

8   Costs of valuers

 

The costs, fees and expenses of each Valuer appointed under this Schedule must
be borne by the Lessor and the Lessee in equal shares.

 

9   Criteria for determining the current base rent

 

  (a)   The annual market rent of the Premises at the subject Review Date must
(subject to sub-clause (b)) be determined on the basis of the following
Criteria:

 

  (1)   Comparable rents: rents as at the Review Date in respect of any
comparable premises;

 

  (2)   Condition of premises: any adverse effect on the condition or rental
value of the Premises arising out of a breach of this Lease by the Lessee (or
any sub-lessee or Lessee’s Predecessors) is not to have occurred;

 

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  (3)   Period between reviews: the period which will elapse between the Review
Date and the next Review Date or CPI Review Date (if any);

 

  (4)   Length of term: the length of the whole of the Term, to the intent that
the fact that part of the Term may have elapsed as at the Review Date must not
be taken into account;

 

  (5)   Destruction or damage: that if the Premises or any other part of the
Complex has been destroyed, damaged, rendered inaccessible or are being
refurbished, they are deemed to have been fully repaired and restored;

 

  (6)   Option for further term: that the value to a lessee of any option(s) for
a further term expressed in this Lease must be taken into account;

 

  (7)   No reduction: that despite any other provision of this Lease, the annual
market rent of the Premises must not be less than the Base Rent current
immediately prior to the Review Date;

 

  (8)   Goodwill: that the value of any goodwill attached to the Premises due to
the Lessee’s occupation of or business in the Premises must not be taken into
account;

 

  (9)   Sub-lettings: that rents in respect of any sub-letting of or
concessional occupational arrangement in respect of the Premises or any
comparable premises must not be taken into account;

 

  (10)   Lessee’s fixtures: that the value of the Lessee’s Equipment must not be
taken into account unless it was installed pursuant to an obligation on the
Lessee or any Lessee’s Predecessors under this Lease;

 

  (11)   Willing but not anxious: that this Lease is in place and is between a
willing but not anxious lessor and a willing but not anxious lessee enjoying or
entitled to enjoy actual possession of the whole of the Premises as at the
Review Date; and

 

  (12)   Ready for occupation: that the Premises are ready for immediate
occupation and use.

 

  (b)   Despite any other provision of this Schedule, any person may take into
account any other criteria which may, in that person’s opinion, be relevant to
his determination of the annual market rent of the Premises as at the subject
Review Date, but must not take into account anything which is not consistent
with the Criteria listed in sub-clause (a) (which are in random order and no
significance or priority is to be attached to that order).

 

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Schedule 3 – Car Parking and Use of Car Park

 

1   Definitions

 

  (a)   In this Schedule a reference to a clause is a reference to a clause in
this Schedule.

 

  (b)   Where in this Schedule:

 

  (1)   an obligation is imposed on the Lessee, the Lessee must observe and
ensure that each User observes that obligation; and

 

  (2)   the Lessee is prohibited from doing anything, the Lessee must not do
that thing and must ensure that each User does not breach the prohibition.

 

2   Parking spaces

 

  (a)   The Lessor must notify the Lessee of the Parking Spaces allocated to it
as at the date in Item 6. The Lessor will line mark the Parking Spaces allocated
to the Lessee and will identify them as the Lessee’s Parking Spaces.

 

  (b)   The Lessee must ensure that each User only parks wholly within a Parking
Space allocated at the time to the Lessee.

 

  (c)   The Lessor may, on giving notice to the Lessee, change any Parking Space
allocated to the Lessee.

 

  (d)   The Lessor is not liable to the Lessee for any unauthorised use of any
Parking Spaces subject to the Lessor taking reasonable steps to prevent such
unauthorised use of any Parking Spaces.

 

3   Use of car park

 

  (a)   Notification of details: The Lessee must promptly give to the Lessor the
registration number of any car which the Lessee or any User will park in the Car
Park.

 

  (b)   Access and security:

 

  (1)   Subject to the Lessee and each User complying with the Lessor’s
reasonable requirements in relation to entering and leaving the Car Park and
security of the Complex, access to and egress from the Car Park shall be
available TWENTY FOUR (24) hours, SEVEN (7) days a week.

 

  (2)   The Lessee must use all reasonable endeavours to maintain the Lessor’s
security arrangements (if any) for the Complex and must observe all reasonable
directions issued by the Lessor in respect of security outside Established
Complex Hours.

 

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  (3)   The Lessor is under no duty to check or verify the identity, authority
or good faith of any person seeking to enter or remove a car in the Car Park.

 

  (c)   Nuisance / dangerous things: The Lessee must not:

 

  (1)   run the engine of a car for longer than is necessary to park the car or
when entering or leaving the Car Park.

 

  (2)   sound the horn of a car unnecessarily,

 

  (3)   deposit any rubbish, wrappings or garbage in the Car Park,

 

  (4)   obstruct access to the Car Park’s entrances and exits, or

 

  (5)   bring into the Car Park anything which is flammable, explosive, toxic,
hazardous or injurious to health, other than fuel in the storage tank of a car.

 

  (d)   No unsound vehicles: The Lessee must not bring into the Car Park any car
unless it is in sound mechanical condition and does not drip oil or other
hazardous fluids (and must promptly clean up and remove any oil or other fluid
emitted from any car brought into the Car Park by it or the Users). The Lessee
must not carry out repairs or maintenance to a car in the Car Park (except on a
breakdown).

 

  (e)   Traffic signs: The Lessee must at all times strictly comply with:

 

  (1)   all traffic signs in and about the Car Park and its entrances and exits;

 

  (2)   any reasonable conditions of entry and rules applying from time to time
in respect of the Car Park and of which the Lessee bas been given a copy or
which are displayed in the Car Park; and

 

  (3)   the Lessor’s reasonable directions from time to time in relation to the
use of and access to the Car Park.

 

  (f)   “Termination” of users: If any User does not (in the Lessor’s reasonable
opinion) comply with this Schedule, the Lessee must, at the Lessor’s written
request, immediately terminate that person’s status as a User. On service of the
request on the Lessee, that person ceases to be a User and must not be
reinstated as a User without the Lessor’s prior approval. This sub-clause does
not limit the Lessor’s rights under clause 4.

 

4   Termination

 

  (a)   The licence granted in respect of the Parking Spaces terminates on the
first to occur of the following:

 

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  (1)   (at the Lessor’s option) where the Lessee fails to remedy any breach of
this Lease relating to the Car Park within a reasonable time after notice from
the Lessor, and

 

  (2)   on the expiration or sooner determination of this Lease.

 

  (b)   On termination of the licence, the Lessee must remove from the Car Park
all cars of the Lessee and each User.

 

  (c)   The Lessor may remove any car left in the Car Park in breach of
sub-clause (b). Whatever the Lessor does in good faith under this sub-clause is
deemed to be done with the full authority of and at the risk and cost in all
rights of the Lessee.

 

5   No assignment by lessee

 

  (a)   This licence is not assignable by the Lessee. However, the Lessor shall
(at the Lessee’s request and cost) grant a substitute licence to an assignee of
the whole of the Lease under an assignment made under the Lease.

 

  (b)   The substitute licence shall be consistent with the current form of car
park licence then in use by the Lessor for occupiers of the Complex, but the new
licence must not materially lessen the rights of the Lessee under this Schedule.
The substitute licence shall be for the then unexpired portion of the Term. This
clause does not prevent the Lessee from permitting the Lessee’s Agents to use
the Parking Spaces.

 

  (c)   The Lessee may only sub-licence this licence to a person who has been
granted a sub-lease or licence in accordance with this Lease, and only for a
term which does not exceed the then unexpired portion of the Term. The Lessee
must ensure that any sub-licensee and any person using the Car Park with the
authority of that sub-licensee complies with the provisions of this Schedule 3.

 

6   Effect of resumption or destruction

 

  (a)   Subject to paragraph (b), if the Lessee cannot park in any Parking
Spaces due to the decision of any competent authority or any destruction or
damage of the whole or any part of the Complex, the Lessee is not entitled to
terminate the licence of the Parking Spaces, nor does it have any right of
action or claim for any set-off, compensation or damages against the Lessor.

 

  (b)   If the Lessee cannot park for a period of 1 month in more than 50% of
the Parking Spaces due to either the decision of any competent authority or any
destruction or damage of the whole or any part of the Complex and the Lessor
fails to provide or procure alternative car parking arrangements acceptable to
the Lessee (acting reasonably) within that month, the Lessee shall be entitled
to terminate this Lease by notice in writing to the Lessor.

 

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/s/  RICHARD KALBRENER

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/s/  LAMBERT P. ONUMA

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Richard Kalbrener

     

Lambert P. Onuma

 

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