exv10w1






Exhibit 10.1



 

 

NORTEL NETWORKS TECHNOLOGY CORPORATION




AND



CIENA CANADA, INC.



 






LEASE




 






Premises: Lab #10, Nortel Carling Campus, 3500 Carling Avenue, Ottawa, Ontario




Date: March 19, 2010






 

 




 









 








Table of Contents 




	 	 	 	 	 
	 	 	Page
	Article 1. Basic Terms and Definitions
	 	 	1	 
	 
	Article 2. Demise; Rent
	 	 	5	 
	 
	Article 3. Use
	 	 	7	 
	 
	Article 4. Condition of the Premises
	 	 	8	 
	 
	Article 5. Tenant’s Work/Alterations
	 	 	8	 
	 
	Article 6. Real Estate Taxes
	 	 	10	 
	 
	Article 7. Expenses
	 	 	11	 
	 
	Article 8. Electricity — Direct
	 	 	12	 
	 
	Article 9. Services
	 	 	13	 
	 
	Article 10. Maintenance and Repairs
	 	 	16	 
	 
	Article 11. Laws
	 	 	16	 
	 
	Article 12. Subordination; Estoppel Certificates
	 	 	17	 
	 
	Article 13. Insurance
	 	 	18	 
	 
	Article 14. Casualty
	 	 	20	 
	 
	Article 15. Expropriation or Condemnation
	 	 	21	 
	 
	Article 16. Environmental Matters
	 	 	21	 
	 
	Article 17. Assignment and Subletting
	 	 	22	 
	 
	Article 18. Access
	 	 	24	 
	 
	Article 19. Default
	 	 	25	 
	 
	Article 20. Remedies
	 	 	26	 
	 
	Article 21. Security
	 	 	28	 
	 
	Article 22. Broker
	 	 	30	 
	 
	Article 23. Notices
	 	 	30	 
	 
	Article 24. Representations and Liability
	 	 	30	 
	 
	Article 25. End of Term
	 	 	32	 
	 
	Article 26. Tenant’s Self-Help Remedy
	 	 	33	 
	 
	Article 27. Early Termination by Landlord
	 	 	37	 
	 
	Article 28. Miscellaneous
	 	 	38	 
	 






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	Exhibit “A” The Carling Campus and the Premises
	 	 	 	 
	Exhibit “B” Landlord’s Regulations
	 	 	 	 
	Exhibit “C” Building Services Matrix
	 	 	 	 
	Exhibit “D” Standby Letter of Credit
	 	 	 	 
	Exhibit “E” Termination Fee Reduction Schedule
	 	 	 	 
	Exhibit “F” Closing and Escrow Agreement — Carling
	 	 	 	 











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LEASE




          REAL ESTATE LEASE (“Lease”) dated March 19, 2010, between NORTEL NETWORKS TECHNOLOGY
CORPORATION (“Landlord”) and CIENA CANADA, INC. (“Tenant”)




          WHEREAS, Tenant and its affiliates have purchased the ‘Metro Ethernet Networks’ business of
Landlord and certain of its affiliates (the “MEN Business”) identified in an Amended and Restated
Asset Sale Agreement (the “ASA”) dated as of November 24, 2009, which transaction is being
completed as of the date hereof (the “Closing Date”);




          WHEREAS, Landlord is one of the entities granted certain initial creditor protection in an
application for protection under the Companies’ Creditors Arrangement Act (the “CCAA”) pursuant to
an order issued by the Ontario Superior Court of Justice (the “Canadian Court”) dated January 14,
2009 (the “Initial Order”), which also appointed Ernst & Young Inc. as “Monitor” in connection with
the CCAA Cases (defined below) and was extended by further order of the Canadian Court from time to
time, most recently on July 30, 2009, as the same may be amended, extended, restated or replaced
from time to time by the Canadian Court (the proceedings commenced by such application, the “CCAA
Cases”);




          WHEREAS, on December 2, 2009, the Canadian Court in the CCAA Cases issued that certain
Approval and Vesting Order authorizing the transactions contemplated in the ASA, including, without
limitation, the entering into of this Lease (the “Order”);




          WHEREAS, Landlord proposes to lease the Premises, as defined below, and the Additional
Premises as defined in the Additional Premises Lease to Tenant, and Tenant proposes to lease the
Premises from Landlord upon the terms and conditions hereinafter set forth and the Additional
Premises upon the terms and conditions set forth in the Additional Premises Lease.




          NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:




          Article 1. Basic Terms and Definitions




     Section 1.1 “Additional Premises” means the premises in the Carling Campus leased by Tenant
from Landlord under the Additional Premises Lease.



     Section 1.2 “Additional Premises Lease” means the lease agreement between Landlord and Tenant
dated as of the date of this Lease in respect of the Additional Premises, as same may be amended,
restated or extended from time to time.



     Section 1.3 “Additional Rent” has the meaning set forth in Section 2.3.



     Section 1.4 “Authority” has the meaning set forth in Section 11.1.



     Section 1.5 “Building Services” means the services to be provided by Landlord to the Premises
or otherwise for the benefit of Tenant as listed in the “Services Matrix” set out in Exhibit “C”
attached hereto.



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     Section 1.6 “Base Rate” has the meaning set forth in Section 20.1(e).



     Section 1.7 “Building” means the building identified as the “Lab 10” building within the
Carling Campus within which the Premises are situate.



     Section 1.8 “Building Standard” means the standard of quality to which the Premises and the
Carling Campus have been constructed, maintained, repaired and operated by Landlord typically prior
to the Commencement Date, and the typical Operating Expenses which would be expected to be incurred
and expended by Landlord in connection with such maintenance and operation of the Premises and the
Carling Campus as a multi-tenant commercial office campus.



     Section 1.9 “Building Systems” means the utility, heating, ventilation, air-conditioning,
mechanical, electrical, plumbing, life safety, security, storm and sanitary drainage systems and
other facilities of the Premises and the Carling Campus, as the same exist as at the Commencement
Date and as may be modified by Landlord in its sole discretion from time to time, provided that
such modifications do not adversely affect the maintenance and operation of the Building in
accordance with the Building Standard in any material manner.



     Section 1.10 “Business Day” means a day on which the banks are opened for business (Saturdays,
Sundays, statutory and civic holidays excluded) in Ottawa, Ontario, Canada.



     Section 1.11 “Carling Campus” means the buildings, facilities and improvements on the owned
and leased parts of the lands forming part of the “Nortel Carling Campus,” municipally known as
3500 Carling Avenue, Ottawa, Ontario existing as at the Commencement Date of this Lease, as
illustrated on Exhibit “A” attached hereto, as may be modified by Landlord in its sole discretion
from time to time, provided that such modifications do not adversely affect the maintenance and
operation of the Carling Campus in accordance with Building Standard in any material manner.



     Section 1.12 “Carling Works” has the meaning set forth in Section 4.2.



     Section 1.13 “Commencement Date” means the Closing Date, as defined in the ASA.



     Section 1.14 “Common Areas” means all parts of the lands, areas, facilities, improvements,
systems, equipment, and installations in, upon or forming part of the Carling Campus which, from
time to time are not used exclusively by other occupants of the Carling Campus and includes
pedestrian sidewalks, driveways (including, without limitation, the ring road circling the Carling
Campus) parking areas, public or shared corridors, including without limitation, the pedestrian
traffic tunnel between the Lab 2 Building and the Lab 10 Building, stairways and elevators, loading
and dock areas, truck courses, and Building Systems provided, utilized or available for the
occupants of the Carling Campus, their employees, customers and others or for general use and
enjoyment, as the same exist as at the Commencement Date and as may be modified by Landlord in its
sole discretion from time to time, provided that such modifications do not adversely affect the
maintenance and operation of the Common Areas in accordance with the Building Standard in any
material manner.



     Section 1.15 “Consolidation Works” has the meaning set forth in Section 2.1.



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     Section 1.16 “Default” has the meaning set forth in Section 19.1.



     Section 1.17 “Default Rate” has the meaning set forth in Section 20.6.



     Section 1.18 “Early Termination Fee” and “Early Termination Right” have the respective
meanings set forth in Section 27.1.



     Section 1.19 “Escrow Agreement” means the “Closing and Escrow Agreement — Carling” to be
entered into between the parties concurrently with the Lease in substantially the form set out in
Exhibit “F” hereto.



     Section 1.20 “Expenses” has the meaning set forth in Section 7.1.



     Section 1.21 “Fixed Rent” has the meaning set forth in Section 2.1.



     Section 1.22 “GST” means the goods and services tax imposed on Rent under the Excise Tax Act,
and any additional, supplemental, replacement, amended, or harmonized tax levied upon the Rent from
time to time.



     Section 1.23 “Interim License” has the meaning set forth in Section 2.1.



     Section 1.24 “Laws” has the meaning set forth in Section 11.1.



     Section 1.25 “Landlord’s Regulations” has the meaning set forth in Section 3.3.



     Section 1.26 “Material Interruption” has the meaning set forth in Section 26.1.



     Section 1.27 “Mortgagee” has the meaning set forth in Section 12.1.



     Section 1.28 “Mortgages” has the meaning set forth in Section 12.1.



     Section 1.29 “Notice Address” means:




	 	(a)	 	for Landlord:
	 
	 	 	 	Nortel Networks Technology Corporation





	 	 	 	 	 

	 

	 	c/o Nortel Networks
	 	c/o Nortel Networks
	 

	 	GMS 991-01-A10
	 	5945 Airport Road, Suite 360
	 

	 	2221 Lakeside Boulevard
	 	Mississauga, Ontario,
	 

	 	Richardson, Texas 75082
	 	Canada L4V 1R9
	 

	 	Attention: Real Estate Group
	 	Attention: Real Estate Group
	 

	 	Facsimile: (972) 684-3868
	 	(Richardson Tx)






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	(b)

	 	for Tenant:
	 	with a copy to:
	 
	 	 	 
	 

	 	Ciena Canada Inc.
	 	Ciena Corporation
	 

	 	c/o Ciena Corporation
	 	1201 Winterson Road
	 

	 	1201 Winterson Road
	 	Linthicum, MD
	 

	 	Linthicum, MD
	 	21090 USA
	 

	 	21090 USA
	 	Fax: 1-410-981-7651
	 

	 	Fax: 1-410-865-8001
	 	Attention: Director, Facilities
	 

	 	Attention: General Counsel
	 	(Real Estate)






     Section 1.30 “Operating Expense Contribution” has the meaning set forth in Section 2.3.



     Section 1.31 “Permitted Uses” has the meaning set forth in Section 3.1.



     Section 1.32 “Premises” means the whole of the “Lab 10” Building in the Carling Campus having
a deemed area for all purposes under this Lease of 265,000 square feet of Rentable Area and the
lands used in connection with such Lab 10 Building (the “Lands”) shown outlined in thick black on
Exhibit “A” to this Lease. The Premises include any fixtures and improvements in the Premises on
the Commencement Date, and any other fixtures and improvements installed in the Premises by or on
behalf of Tenant or by Landlord after the Commencement Date (in each case excluding Tenant’s
Property).



     Section 1.33 “Rent” has the meaning set forth in Section 2.3.



     Section 1.34 “Rentable Area” has the meaning set forth in Section 2.2.



     Section 1.35 “Security” means an amount equivalent to a total of three (3) month’s Rent, to be
adjusted as such amounts are applied by Landlord where permitted by the terms of this Lease to
ensure it continues to represent three (3) month’s Rent at all times through the Term.



     Section 1.36 “Taxes” means all taxes, rates, duties and assessments whatsoever, whether
municipal, provincial, parliamentary or otherwise, now charged or hereafter to be charged upon the
Premises, the Lands, the Building, the Carling Campus or any part or parts thereof or upon Landlord
in respect thereof, including school taxes, municipal taxes and taxes for local improvements or
works assessed against the Carling Campus, including any interest and penalties related thereto.



     Section 1.37 “Tenant’s Property” means Tenant’s trade fixtures, furniture, furnishings,
fittings, equipment, apparatus, appliances and other articles of personal property. Tenant’s
Property includes any Transferred Tenant’s Property.



     Section 1.38 “Tenant’s Share” means that percentage of total Expenses for the Carling Campus
determined by the fraction having as the numerator the Rentable Area of the Premises and as the
denominator, the Rentable Area of the occupied portions of the Carling Campus.



     Section 1.39 “Tenant’s Work” has the meaning set forth in Section 5.2.



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     Section 1.40 “Term” means the period commencing on the Commencement Date and ending on the
date (the “Expiration Date”) which is the earlier of (i) the last day of the month in which occurs
the tenth (10th) anniversary of the day immediately preceding the Commencement Date (“Fixed
Expiration Date”), and (ii) the date the term of this Lease is terminated by Landlord pursuant to
Section 27.1 (“Early Termination Date”), and (iii) the date the term of this Lease is
otherwise terminated under the provisions of this Lease (“Earlier Expiration Date”).



     Section 1.41 “Transferred Tenant’s Property” means Landlord’s former trade fixtures,
furniture, furnishings, fittings, equipment, apparatus, appliances and other articles of personal
property located at the Premises and used primarily in connection with the MEN Business divested
pursuant to the ASA in accordance with the terms thereof.



     Section 1.42 “Unavoidable Delay” has the meaning set forth in Section 24.8.



     Section 1.43 Certain Definitions. Any reference in this Lease to (a) “legal action”, includes
any suit, proceeding or other legal, arbitration or administrative process, (b) “person”, includes
any individual or entity, and (c) “this Lease”, includes Landlord’s Regulations and the Exhibits to
this Lease. Any capitalized terms used and not otherwise defined in this Lease shall, if defined
in the ASA, have the meanings ascribed to such terms in the ASA.



          Article 2. Demise; Rent




     Section 2.1 Landlord hereby leases to Tenant, and Tenant hereby leases from Landlord, the
Premises, for the Term, at the Rent and on the other terms and conditions of this Lease. The use
and occupation by Tenant of the Premises includes the non-exclusive right of Tenant and Persons
having business with Tenant, in common with Landlord, its other tenants, subtenants and all others
entitled or permitted by Landlord to the use of such parts of the Common Areas as may be designated
by Landlord from time to time as being available for general use by tenants and other occupants of
the Carling Campus and customers and visitors thereto. Pending the completion of any relocation,
demising and consolidation works by Landlord in respect of the Transferred Employees and
Transferred Tenant Property into the Premises (the “Consolidation Works”), Landlord grants to
Tenant and the Transferred Employees a non-exclusive license to access, occupy and operate within
the existing spaces and locations occupied by the Business in the Campus as at the Commencement
Date in the same manner as was the case prior to the Commencement Date (the “Interim License”).
The Interim License shall expire and cease to have force and effect upon completion of the
Consolidation Works.



     Section 2.2 Beginning on the Commencement Date, and in each year of the Term, Tenant shall pay
to Landlord without demand, and without any set-off or deduction whatsoever, as rental for the
Premises and for the non-exclusive use of the Common Areas, the fixed rent (the “Fixed Rent”),
which is hereby set at [*] per annum ([*] per month) plus GST calculated at the rate of [*] per
square foot of rentable area per annum, based upon the area of the Premises having a total deemed
rentable area of 265,000 sq. ft. (“Rentable Area”).




 




			
	[*]	 	Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission.
Confidential treatment has been requested with respect to the omitted portions.




5









 





          The Fixed Rent shall be paid in equal monthly installments, in advance, on the first day of
each calendar month during the Term, except that on the first day of the month following the
Commencement Date, Tenant shall pay Landlord the full monthly installment of the Rent due for such
month along with the Rent for the period between the Commencement Date and the last day of the
month in which the Commencement Date occurs on a per diem basis (such amount being agreed by the
parties to be [*]), to be applied to the first installments of Rent due under this Lease. If the
Commencement Date or the last day of the Term or such earlier date as the Lease may be terminated
is not the first day of a month, the Fixed Rent for the month in which such date occurs shall be
apportioned according to the number of days in that month.




     Section 2.3 Tenant covenants to pay at the same time and in the same manner as Fixed Rent,
Tenant’s Share of Expenses subject to the proviso that Tenant’s share of Expenses for the first
year of the Term shall be [*] per square foot of Rentable Area of the Premises per annum ([*],
payable in monthly installments of [*]) plus GST. On the first anniversary of the Commencement
Date, and every anniversary thereafter during the Term, Tenant’s share of Expenses shall be
increased by [*] per annum, and each such increased amount shall represent Tenant’s share of
Expenses for that applicable year (herein called the “Operating Expense Contribution”). It is the
intention of the parties that Tenant’s Operating Expense Contribution constitute a “gross rental”
amount in respect of the Expenses that Tenant is responsible for and that Tenant shall not be
responsible for any other Expenses of Landlord whatsoever over and above Tenant’s Operating Expense
Contribution other than those expressly set forth in this Lease as being the responsibility of
Tenant.



          Tenant further covenants to pay as additional rent the following sums to Landlord under this
Lease (other than Fixed Rent and Operating Expense Contribution) (herein called “Additional Rent”,
and together with the Fixed Rent and the Operating Expense Contribution, collectively called
“Rent”)




          (a) GST on Rent;




          (b) all fees and management or administrative costs of Landlord expressly stipulated in this
Lease to be payable by Tenant over and above Operating Expense Contribution;




          (c) the cost of Landlord’s consent to, review and supervision of in respect of any Tenant’s
Works which require the consent of Landlord under the terms of this Lease; and




          (d) any Expense incurred by Landlord to repair or replace any part of the Premises or the
Carling Campus damaged or destroyed by Tenant or those for whom Tenant is responsible in law.




          In addition to the foregoing, Tenant shall be responsible to pay directly to the applicable
Authority, its own business taxes and license fees.




     Section 2.4 Tenant shall pay Landlord the Rent, without notice, demand, deduction or offset
(except as provided in this Lease), in Canadian Dollars, by wire transfer or another method
approved by Landlord, at Landlord’s Notice Address or another address Landlord designates, and as
provided in this Lease. Landlord’s delay in rendering, or failure to render, any statement
required to be rendered by Landlord for any Rent for any period shall not waive Landlord’s right





 




			
	[*]	 	Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission.
Confidential treatment has been requested with respect to the omitted portions.




6










 




to render a statement or collect that Rent for that or any subsequent period provided that
Landlord shall not claim or recover any amount relating to any lease year more than one year after
the end of that year. The rendering of an incorrect statement shall not waive Landlord’s right to
render a corrected statement for the period covered by the incorrect statement and collect the
correct amount of the Rent, provided such corrected statement is rendered to Tenant within ninety
(90) days from the date of the incorrect statement.




          Article 3. Use




     Section 3.1 Tenant shall be entitled to use the Premises primarily for the purposes of
operation of the MEN Business in substantially the manner as previously conducted in the Premises
by Landlord, or any other similar type of technology based business, having as ancillary uses
thereto (i) offices and associated meeting areas, (ii) a sales centre and showroom, (iii)
laboratories and research and development purposes and/or (iv) any other uses permitted under the
zoning by-laws and other restrictions imposed by any Authority upon the Premises (collectively, the
“Permitted Uses”) and for no other uses. Landlord represents and warrants that it has received no
notice from any Authority imposing such restrictions on the use of the Premises for the purposes of
the MEN Business.



     Section 3.2 Tenant shall not (a) use any part of the Premises in violation of this Lease or
the certificate of occupancy, if any, for the Premises; (b) use any area outside the Premises and
adjacent to the Premises for the outdoor sale or display of any merchandise, for solicitations or
demonstrations; (c) store trash other than inside the Premises or in areas behind the Premises,
provided such outdoor storage areas are maintained in a clean and orderly condition; (d) cause
waste or damage to the Premises, or permit the use of the Premises for any dangerous, noxious or
offensive use, trade, business or activity; (e) place any sign outside the Premises or in the
Carling Campus except as expressly permitted by Section 9.8 of this Lease, (f) park trucks
or other vehicles in a manner which interferes with ingress and egress to and from the Premises or
the Carling Campus, (g) cause the release in or from the Premises of any Hazardous Material, or any
other item which is deemed Hazardous under any Law, or (h) advertise in a manner which, if the
Premises are identified, in Landlord’s reasonable judgment, impairs the reputation or desirability
of the Carling Campus, or (i) move any large equipment into or out of the Premises the installation
or removal of which could reasonably be expected to cause damage to the Premises, without prior
notice to, and in compliance with any reasonable requirements imposed by, Landlord.



     Section 3.3 Tenant shall comply with the existing rules and regulations of the Carling Campus
attached to this Lease as Exhibit “B”, and any future rules and regulations adopted by Landlord,
acting reasonably, ten (10) days prior written notice of which shall be given to Tenant, in
connection with the operation of, and construction work within, the Premises which do not
materially and adversely affect Tenant’s rights under this Lease (collectively, “Landlord’s
Regulations”). Landlord is not required to enforce Landlord’s Regulations or any other lease in
the Carling Campus and Landlord shall not be liable to Tenant for a violation of Landlord’s
Regulations or any other lease in the Carling Campus by any other tenant or occupant of the Carling
Campus. Landlord’s failure to enforce Landlord’s Regulations against Tenant or any other occupant
of the Carling Campus shall not be considered a waiver of Landlord’s Regulations. Landlord shall
not, however, enforce Landlord’s Regulations against Tenant in a



7









 




discriminatory or arbitrary manner. If there is any inconsistency between this Lease and
Landlord’s Regulations, this Lease shall control.




          Article 4. Condition of the Premises




     Section 4.1 Tenant confirms that, subject to the Carling Works to be completed by Landlord in
accordance with the provisions of Subsection 4.3, (i) it has examined the Premises and shall accept
possession of the Premises in their “AS IS” condition on the Commencement Date, subject to normal
wear and tear and the removal of the existing occupant’s property, if any, and repair of any damage
caused by such removal; (ii) Landlord has no obligation to perform any other work, supply any
materials, incur any expenses or make any installations to prepare the Premises for Tenant’s
occupancy. Landlord represents and warrants that, to the best of its knowledge, the Premises
(including the Building Systems) are in a good state of repair and in proper working order for the
purposes for which the Premises have typically been used by Landlord for the period prior to the
Commencement Date.



     Section 4.2 Landlord has estimated (with reference to the plans and documentation attached to
the Escrow Agreement) that the aggregate cost of all works necessary in order to demise and
segregate the Lab 2 Premises and to relocate the MEN Business into the Lab 10 Premises and Lab 2
Premises, each in accordance with the plans and specifications referenced in the Escrow Agreement
(the “Carling Works”), is [*], plus applicable Taxes. Landlord shall be responsible for completing
the Carling Works pertaining to the relocation and consolidation of the MEN Business into the
Premises and the Lab 2 Premises) and all works required to physically separate and demise the
Premises from the balance of the space within the Lab 2 Building. Tenant shall be responsible, in
accordance with the provisions set out in the Escrow Agreement, for up to a maximum of [*] of the
initial costs of completing such works and Landlord shall be responsible for all remaining costs
associated with completing such Carling Works.



     Section 4.3 Landlord shall undertake and complete the Carling Works in accordance with the
provisions of the Escrow Agreement. Tenant shall make itself available to provide reasonable and
timely cooperation to assist with the planning, designing, implementation and completion of the
Carling Works in each case without further cost contribution by Tenant.



          Article 5. Tenant’s Work/Alterations




     Section 5.1 All structural alterations to the Premises and such works referred to in
Subsection 5.2(b)(i), (ii) and (iii) hereof are strictly prohibited without the prior written
consent of Landlord, such consent not to be unreasonably withheld, conditioned or delayed.



     Section 5.2



          (a) Tenant may, at any time or times, subject to prior written notice to but without the
prior written consent of Landlord, (i) install and remove Tenant’s Property at the Premises;
and, (ii) paint, decorate, install carpeting and flooring at the Premises and make architectural
changes (i.e., cosmetic changes that do not require a building permit) to the interior of the
Premises, provided, in each case, that such changes do not materially adversely affect any





 




			
	[*]	 	Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission.
Confidential treatment has been requested with respect to the omitted portions.






8









 







Building System servicing the Premises or the Landlord’s Building Services or operation of the
Premises in accordance with the Building Standard.




          (b) Tenant may, at any time or times, subject to prior written notice to and with the
prior written consent of Landlord, such consent not to be unreasonably withheld, conditioned or
delayed, make additions, changes or alterations to the Premises as it deems desirable for the
Permitted Uses of the Premises, provided that such additions, changes or alterations do not (i)
weaken or endanger the structure of the Premises or the Building; (ii) materially adversely affect
any Building System servicing the Premises, the Landlord’s Building Services or operation of the
Premises in accordance with the Building Standard, or (iii) materially adversely affect the
operation of any other buildings in the Carling Campus. The work referred to in Section
5.1 and Section 5.2 is hereinafter collectively referred to as the “Tenant’s Work”.




          (c) Tenant’s Work shall be performed only by reputable contractors or subcontractors in good
standing. Tenant’s Work shall be performed at Tenant’s expense, in a professional manner using new
materials of first class quality and in compliance with this Lease, all Laws and Tenant’s Plans (as
defined in Section 5.3).




     Section 5.3 Prior to performing any Tenant’s Work which pursuant to this Article requires
Landlord’s consent, Tenant shall, at Tenant’s expense (a) deliver to Landlord, detailed plans and
specifications for Tenant’s Work in form reasonably satisfactory to Landlord, and to the extent
reasonably necessary, prepared and certified by a registered architect or licensed engineer, and
suitable for filing with the applicable Authority, if filing is required by Law (“Tenant’s Plans”),
(b) in respect of any Tenant’s Works which require consent, obtain Landlord’s approval of Tenant’s
Plans (which shall not be unreasonably withheld, conditioned or delayed), (c) obtain (and deliver
to Landlord copies of) all required authorizations of any Authority and (d) deliver to Landlord
certificates (in form reasonably acceptable to Landlord) of worker’s compensation and insurance
(covering all persons to be employed by Tenant, and all contractors and subcontractors performing
any Tenant’s Work), commercial general liability insurance (naming Landlord, Landlord’s managing
agent, if any, Landlord and any Mortgagee as additional insureds) and Builder’s risk insurance
(issued on a completed value basis), in form, with companies, for periods and in amounts reasonably
required by Landlord, naming Landlord, Landlord’s managing agent, if any, and any Mortgagee as
additional insureds. Whether Tenant’s Plans are approved or not, Tenant shall promptly reimburse
Landlord for any reasonable out-of-pocket expenses incurred by Landlord in connection with
Landlord’s review of Tenant’s Plans and inspection of Tenant’s Work, including outside experts
retained by Landlord for that purpose. Following the completion of Tenant’s Work, Tenant shall, at
Tenant’s expense, obtain and deliver to Landlord copies of all authorizations of any Authority
required upon the completion of Tenant’s Work and “as-built” plans and specifications for Tenant’s
Work prepared as reasonably required by Landlord.



     Section 5.4 If, in connection with Tenant’s Work or any other act or omission of Tenant or
Tenant’s employees, agents or contractors, a construction lien, financing statement or other lien
or violation is filed against Landlord, or any part of the Premises, the Building or Tenant’s Work,
Tenant shall, at Tenant’s sole cost and expense, have it removed by bonding or otherwise within
twenty (20) days after Tenant receives notice of the filing.



9









 





     Section 5.5 Tenant shall not employ, or permit the employment of, any contractor,
subcontractor or other worker in the Premises, whether in connection with Tenant’s Work or
otherwise, if such employment shall, in Landlord’s reasonable judgment, interfere or cause conflict
with other contractors, subcontractors or workers in the Carling Campus.



     Section 5.6 At Tenant’s request, Landlord shall join in any applications for any
authorizations required from any Authority in connection with Tenant’s Work (to which Landlord has
consented, if required pursuant to this Article), and otherwise cooperate with Tenant in connection
with Tenant’s Work, but Landlord shall not be obligated to incur any expense or obligation in
connection with any such applications or cooperation.



     Section 5.7 Tenant shall not place a load on any floor of the Premises exceeding the floor
load per square foot which the floor was designed to carry and which is allowed by any applicable
Law.



     Section 5.8



          (a) All Tenant’s Work shall become the property of Landlord at the Expiration Date. By the
Expiration Date, Tenant shall, at Tenant’s expense, remove from the Premises and the Carling Campus
Tenant’s Property and, if required by Landlord, Tenant’s Work including all demising walls, and
repair any damage to the Premises or the Carling Campus caused by the installation or removal of
Tenant’s Property or Tenant’s Work.




          (b) All Tenant’s Property shall remain the property of Tenant and may be removed by Tenant at
any time prior to the expiry of the Term. If Tenant removes any Tenant’s Property from the
Premises, Tenant shall repair any damage to the Premises caused by such removal Any Tenant’s
Property which is not removed by Tenant by ten (10) days of the Expiration Date shall be deemed
abandoned and may, at Landlord’s option, be retained as Landlord’s property or disposed of by
Landlord at Tenant’s expense.




          Article 6. Real Estate Taxes




     Section 6.1 Landlord acknowledges and agrees that Tenant’s Share of Taxes are included in
Tenant’s Operating Expense Contribution.



     Section 6.2 Landlord may, at Landlord’s option and at no additional expense to Tenant
(Landlord acknowledging that all such costs and expenses are deemed to be included in Tenant’s
Operating Expense Contribution), institute proceedings to reduce Taxes. Tenant may not institute
such proceedings.



     Section 6.3 If Taxes are reduced, abated or discounted for any reason or Landlord receives a
refund or credit of Taxes, the reduction, refund, or credit shall not be taken into account, and
there shall be no adjustment to Tenant’s Operating Expense Contribution in respect of such refund
or credit. Likewise, if Taxes are increased for any reason, the increase shall not be taken into
account, and there shall be no increase in Tenant’s Operating Expense Contribution as a result of
such increase.



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          Article 7. Expenses




     Section 7.1 “Expenses” means, without duplication, all of Landlord’s costs, fees and expenses
incurred in connection with operating, insuring, maintaining, repairing and replacing the Carling
Campus in accordance with the Building Standard, including, without limiting the generality of the
foregoing, the delivery of the Building Services, insurance premiums, the cost of providing
electric light, power, fuel, heat, processed air and gas and the maintenance of any service
arrangements and shipping and receiving infrastructure in any building in the Carling Campus which
provides shipping and receiving services for the Premises.



     Section 7.2 Tenant’s Share of Expenses are included in Tenant’s Operating Expense
Contribution. Tenant’s Operating Expense Contribution shall be paid in equal monthly installments,
in advance, on the first day of each calendar month during the Term, except that on the
Commencement Date, Tenant shall pay Landlord one full monthly installment of Tenant’s Operating
Expense Contribution, to be applied to the first full monthly installment of Tenant’s Operating
Expense Contribution due under this Lease. If the Commencement Date or the last day of the Term or
such earlier date as the Lease may be terminated is not the first day of a month, Tenant’s
Operating Expense Contribution for the month in which such date occurs shall be apportioned
according to the number of days in that month.



     Section 7.3 For the avoidance of doubt, Tenant’s Operating Expense Contribution is deemed to
be inclusive of all of the following Expenses which may be incurred by Landlord from time to time
(a) income tax, profit, excess profit, capital, large corporations, place of business, gift,
estate, succession, inheritance, franchise, land transfer, non-residential, business (other than
those business taxes specifically payable by Tenant pursuant to this Lease), and any other taxes
personal to Landlord; (b) the cost of any repairs, replacements, upgrades or additions to the
Building Systems, the structure of the Premises (including the roof and roof membrane) and such
other repairs, replacements, installations, upgrades and/or additions to the Carling Campus or the
Premises of a capital nature or constituting a capital improvement, except where necessitated due
to the negligence or willful misconduct of Tenant, its agents, servants, invitees or those for whom
Tenant is in law responsible; (c) penalties, interest, fines, suits, actions, costs and/or charges
relating to the late payment of Taxes, insurance premiums or equipment leases, or any other breach
of any contract or applicable laws, unless caused by the default of Tenant, its agents, servants,
invitees or those for whom Tenant is in law responsible; and (d) all work to the Premises, the
Carling Campus or any part thereof, made necessary by Landlord’s non-compliance with governing
codes, by-laws and/or ordinances, regulations and ordinances relating to the construction or
operation of the Premises or the Carling Campus.



     Section 7.4 Notwithstanding the foregoing, Tenant agrees to pay for the entirety of any
Expenses incurred by Landlord in accordance with the terms of this Lease and solely related to
increases in Building Services or Building Standard costs due solely to Tenant’s required use of
the Premises or alterations thereto and such amounts shall thereafter be included in the
calculation of Tenant’s Share of the Expenses for the duration of such use or the existence of the
alterations, as applicable. For greater clarity, Landlord acknowledges and agrees that Tenant’s
Operating Expense Contribution includes all Expenses necessary to maintain the proper operation of
the Premises and the Building Systems in accordance with the Building Standard in order to
accommodate: (i) the operation of the MEN Business in substantially the same manner



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as typically conducted in the Premises by Landlord for periods prior to the Commencement Date
(operating primarily during the hours of 8am to 6pm Monday to Friday), including up to [*] square
feet of the Rentable Area of the Premises for laboratory uses and, (ii) a population density in the
Premises of [*] of Rentable Area of the Premises for the purposes of carrying out the Permitted
Uses.




     Section 7.5 Tenant services not part of Building Services (e.g. coffee, mail, vending
machines, reprographic services, and Tenant’s equipment maintenance) and other services not
typically provided by a landlord under a commercial lease shall be the sole responsibility of
Tenant,



          Article 8. Electricity — Direct




     Section 8.1 Subject to the provisions of this Article, Landlord shall at all times during the
Term provide electricity to the Premises through the existing electrical system of the Carling
Campus and the Building Systems in accordance with the Building Standard for reasonable use in
connection with the Permitted Uses, having regard to the uses previously conducted in the Premises
by Landlord. Landlord shall not be liable to Tenant for any failure, defect or interruption of
electric service, save and except where caused to due any gross negligence or willful act or
omission by Landlord or those for whom Landlord is responsible at law (including, for greater
certainty, any failure to pay any utilities and service fees and charges as and when due).
Tenant’s use of electricity in the Premises shall not at any time exceed the capacity of the
electrical system within or serving the Premises and Tenant shall not overload any component of the
Building Systems. Landlord shall select (and may from time to time change) the utility or other
supplier providing electricity to the Carling Campus and the Premises). Tenant shall comply with
all rules, regulations, and other requirements of the utility or other supplier.



     Section 8.2 Tenant’s Share of electrical costs consistent with the Building Standard are
included in the Tenant’s Operating Expense Contribution. In order to ensure that the capacity of
the electrical systems servicing the Premises is not exceeded and to avert possible adverse effect
upon such electrical systems serving the Premises, Tenant shall not, without Landlord’s prior
written consent in each instance, such consent not to be unreasonably withheld, condition or
delayed, make any material alteration or addition to the electrical system of the Premises existing
at the Commencement Date. If Landlord grants such consent, the cost of all additional risers and
other equipment required therefor, and the increases in electrical consumption within the Premises
resulting from the operation of such additional fixtures, appliances or equipment shall be paid as
Additional Rent by Tenant to Landlord within fifteen (15) days of delivery of written notice to
Tenant. As a condition to granting such consent, Landlord may require Tenant to agree to pay an
increase in Tenant’s Operating Expense Contribution by an amount which will reasonably reflect the
increased cost of Landlord of the additional electrical services to be furnished to the Premises by
Landlord.



     Section 8.3 For greater clarity, Landlord acknowledges and agrees that Tenant’s Operating
Expense Contribution is inclusive of all electrical costs necessary in order to accommodate: (i)
the operation of the MEN Business in substantially the same manner as conducted in the Premises by
Landlord immediately prior to the Commencement Date (operating primarily during the hours of 8am to
6pm. Monday to Friday) including up to [*] square feet of





 




			
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the Rentable Area of the Premises for laboratory uses; and (ii) a population density in the
Premises of [*] of Rentable Area of the Premises for the purposes of carrying out the Permitted
Uses.




          Article 9. Services




     Section 9.1 Landlord shall deliver, through third party service providers, the Building
Services to the Premises and otherwise for the benefit of Tenant in accordance with the Services
Matrix attached hereto as Exhibit “C” and in accordance with the Building Standard. The costs of
the Building Services delivered in accordance with the base Building Standard is included in
Tenant’s Operating Expense Contribution.



     Section 9.2 Elevators. Landlord shall (unless the Premises are on street level)
provide passenger elevator service for the benefit of the occupants of the Premises. Landlord may
change the manner of operation of any of the elevators, but shall not reduce the hours of operation
without consultation with Tenant.



     Section 9.3 Heat, Ventilation and Air Conditioning. Landlord shall provide to the
Premises through the existing Building Systems, for the comfortable occupancy of the Premises (in
accordance with the Building Standard and Building Systems operational sequences as reasonably
determined by Landlord), heat, ventilation and air conditioning. Landlord makes no representation
and shall have no obligation or liability with respect to the performance or nonperformance of the
Building Systems by reason of (a) the use of the Premises, or any part thereof, in a manner
exceeding the design criteria of the Building Systems, (b) the arrangement of any partitioning or
the ceiling distribution system in the Premises which interferes with normal operation of the
Building Systems, (c) the use of machines or equipment in the Premises, except for ordinary office
machines which do not produce excess heat, (d) Tenant’s failure to comply with this Lease which
affects the performance of the Building Systems, (e) Tenant’s Work, (f) any other act of Tenant or
Tenant’s employees or contractors, or (g) any Law. Landlord represents and warrants that as of the
Commencement Date the Building Systems are in a proper working condition and can accommodate (i)
the operation of the MEN Business in substantially the same manner as conducted in the Premises by
Landlord immediately prior to the Commencement Date (operating primarily during the hours of 8am to
6pm, Monday to Friday) including up to [*] square feet of the Rentable Area of the Premises for
laboratory uses and, (ii) a population density in the Premises of [*] of Rentable Area of the
Premises for the purposes of carrying out the Permitted Uses.



     Section 9.4 Cleaning. Landlord shall provide janitorial and cleaning services for the
Premises (save and except for specialized cleaning of the interior lab spaces) and all Common Areas
in the Carling Campus and cause same to be maintained and kept clean in accordance with the
Building Standard and the costs of such janitorial and cleaning services are included in the
Tenant’s Operating Expense Contribution. In providing such cleaning services, Landlord shall
comply with, and shall make commercially reasonable efforts to require each of its contractors and
agents to comply with, Tenant’s security requirements.



     Section 9.5 Water; Lavatories. Landlord shall provide to the Premises domestic water
for ordinary drinking, pantry and lavatory purposes in accordance with the Building




 




			
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Standard and the service charges and consumption costs related thereto are included in
Tenant’s Operating Expense Contribution. If Tenant requires domestic water for any other purpose,
and domestic water is available for that purpose from the existing Building System, Landlord shall
provide that domestic water, but may install a meter to measure Tenant’s domestic water consumption
for all purposes (or, at Landlord’s option, to measure Tenant’s consumption of only the additional
domestic water), in which event Tenant shall (a) pay to Landlord the cost of the meter and its
installation, (b) at Tenant’s expense, keep the meter in good working order and repair, and (c) pay
to Landlord, within fifteen (15) days following Tenant’s receipt of a bill, the cost incurred by
Landlord to supply domestic water to the Premises as measured by the water meter (including any GST
or other taxes).




     Section 9.6 Access and Security. Tenant shall have access to the Premises 24 hours
each day, seven days each week. Tenant shall have the right to install, at its sole cost and
expense, and subject to prior written approval from Landlord, such approval not to be unreasonably
withheld, conditioned or delayed, its own security system for the Premises. Subject to Section
18.1, Tenant shall have the right: (a) to require all persons entering and leaving the Premises
to identify themselves by registration, security card, electronic identification measures or
otherwise and to establish their right to enter or leave; and (b) to exclude or expel any person at
any time from the Premises if such person is not authorized or entitled to be in the Premises.
Landlord may impose in respect of the Premises, temporarily from time to time, or permanently,
security procedures applicable to the Carling Campus.



     Section 9.7 Directory Listing. Landlord shall list Tenant’s name and the name of any
permitted subtenant on the main tenant directory serving the Premises, if any, at Tenant’s expense.
The listing of any other name on the door of the Premises, the building directory serving the
Premises, or otherwise, shall not vest in that person any right or interest in this Lease or in the
Premises, nor shall it be considered Landlord’s consent to any assignment of this Lease or any
sublease or occupancy of the Premises.



     Section 9.8 Signage. Tenant shall have the right, to the extent permitted by
applicable governmental laws, regulations and ordinances and subject to compliance with Landlord’s
signage guidelines and the consent of the National Capital Commission, to have and install at its
own cost its sign panels on pylon sign serving the Carling Campus along Carling Avenue and Moody
Drive and on the blade sign in front of Lab 10 (which blade sign Tenant to have exclusive use of.
In addition, Tenant shall be permitted to erect temporary signs/banners for a short period of time
after Closing to announce the Closing. Landlord agrees to use its reasonable best efforts to
obtain the consent of the National Capital Commission, to the extent required, to the signage
requested by Tenant. All signage shall be subject to the rules and regulations of Landlord
respecting the size, shape and context of signage at the Carling Campus.



     Section 9.9 Overtime, Extra or Outside Services. If Tenant shall give Landlord
reasonable advance notice that Tenant requires heating, ventilation, air conditioning, or
shipping/receiving services, in addition to, or during hours or on days other than, those set forth
in this Lease, Landlord shall make commercially reasonable efforts to provide that service (unless,
with respect to shipping/receiving service, it is not available during the requested hours or on
the requested days) and Tenant shall pay Landlord, within fifteen (15) days following Tenant’s
receipt of a bill, Landlord’s then established charge for that service. If, upon Tenant’s



14









 




request, Landlord provides Tenant with any service which Landlord is not required to furnish
pursuant to this Lease, Tenant shall pay to Landlord, within ten (10) days following Tenant’s
receipt of a bill, Landlord’s then established charge for that service. Any outside service
providers (other than those used by Tenant in connection with Tenant’s business) may be excluded
from the Carling Campus if in Landlord’s reasonable determination the presence of that service
provider is detrimental to the Carling Campus or any tenant.




     Section 9.10 Parking. Landlord shall provide to Tenant for the non-exclusive use of
Tenant’s employees and invitees, and at no additional cost to Tenant, no less than [*] parking
spaces in the parking areas located on the Carling Campus and shown on the plan Exhibit “A” as lots
U, V, W, X and Y on a first-come, first-served basis. Tenant shall have non-exclusive access to
the parking areas twenty-four (24) hours a day, seven (7) days a week (but subject to security and
other requirements of Landlord which are applicable to all users of such parking areas). Landlord
covenants that, unless required by applicable Laws, it will not at any time during the Term
designate any of the above-described parking areas for the exclusive use of any tenant or occupant
of the Carling Campus or other party, but such covenant does not extend to guaranteeing that there
will not be modifications or elimination to such parking areas in the future, subject to compliance
with Laws. In the event that any of the aforesaid parking areas are eliminated, Landlord shall use
its commercially reasonable efforts to provide an equivalent number of parking spaces for Tenant’s
use in similar proximity to the Premises on the terms and conditions hereinbefore provided.



     Section 9.11 Campus Amenities. Subject to the rules and regulation in effect from
time to time, Tenant’s employees shall have access to and use of any existing sports fields and/or
fitness facilities so long as Landlord continues to operate the same during the Term. Landlord
shall in no event be obligated to continue any such operation and Tenant shall have no claim
against Landlord if it ceases such operation or changes the hours or service levels at any time.
Users of the said facilities shall pay the user costs associated with such facilities as
established by Landlord from time to time.



     Section 9.12 No Warranty by Landlord. Landlord shall have no obligation to provide to
Tenant or the Premises any services except as specifically set forth in this Lease. Landlord does
not warrant that any Building System or service to be provided by Landlord, or any other systems or
services which Landlord may provide shall be free from interruption or reduction. Building Systems
and Building Services, including access, may be interrupted or reduced by reason of Laws, repairs
or changes which are, in Landlord’s reasonable judgment, necessary or desirable, or Unavoidable
Delays, in which event such interruption or reduction shall not, unless otherwise provided in this
Lease (i) constitute an actual or constructive eviction, or a disturbance of Tenant’s use of the
Premises, (ii) entitle Tenant to any compensation or abatement of the Rent, (iii) relieve Tenant
from any obligation under this Lease, or (iv) impose any obligation or liability on Landlord.
Notwithstanding anything in this Section to the contrary, Landlord shall use commercially
reasonable efforts resolve the interruption noted above as soon as reasonably possible and to
minimize the interference to Tenant’s business caused thereby.




 




			
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          Article 10. Maintenance and Repairs




     Section 10.1 Landlord shall throughout the Term, as part of Expenses (except for damage
resulting from any act or omission of Tenant or those for whom Tenant is responsible in law) and in
accordance with the Building Services and Building Standard:



          (a) maintain, repair and replace, as required, the structure of the Buildings in which the
Premises are situate;




          (b) be responsible for any capital repair or replacement (including, without limitation, the
paving and or resurfacing if the parking lots, lanes and roadways on or servicing the Carling
Campus);




          (c) maintain, repair and replace, as required, the Building Systems (whether or not such
systems are located within or outside the Premises);




          (d) remove ice and snow from driveways and parking areas in the Carling Campus; and




          (e) be responsible for any other maintenance, repair and replacement in respect of the
Premises which are expressly stated herein to be the responsibility of Landlord or are not
expressly stated herein to be the responsibility of Tenant.




     Section 10.2 Landlord shall, as part of the services included within Tenant’s Operating
Expense Contribution, subject to the provisions of this Lease and the proviso set out below,
maintain and repair the Premises (including any lavatories within the Premises) and all Building
Systems within and serving the Premises, subject to reasonable wear and tear and damage, but shall
have no responsibility to maintain, repair, replace or insure the Tenant’s Property. Subject to
Section 13.4, all damage to the Premises (including the Building Systems) or the Carling
Campus resulting from any act or omission of Tenant or Tenant’s employees, invitees, customer,
guests or contractors, shall be repaired, at Tenant’s expense, by Tenant to the reasonable
satisfaction of Landlord or, at Landlord’s option, by Landlord. Tenant shall give prompt notice to
Landlord if any portion of the Premises or any Building System within the Premises requires repair.



     Section 10.3 Landlord shall have no liability to Tenant, there shall be no abatement of the
Rent and there shall not be deemed to be any actual or constructive eviction of Tenant arising from
Landlord performing any repairs or other work to any portion of the Premises or the Carling Campus
(including the Premises or the Building Systems). In the performance of such repairs or other
work, Landlord will take reasonable measures to minimize interference with the conduct of Tenant’s
business in the Premises and damage to the Premises, Tenant’s Work and Tenant’s Property (all of
which shall promptly be repaired by Landlord, at its expense), but Landlord is not required to
employ overtime labor or incur extraordinary expenses.



          Article 11. Laws




     Section 11.1 Tenant shall, at Tenant’s expense, subject to the provisions of this Lease,
including Article 5, as if part of Tenant’s Work, comply with all present and future laws,
rules,



16









 




regulations, orders, ordinances, judgments, requirements and (if Landlord adopts same) and
other similar laws (collectively, “Laws”), of any applicable federal, provincial or municipal
governmental authority or any department, commission, board or officer thereof (collectively,
“Authority”) applicable to the Premises, Tenant’s occupancy of the Premises, Tenant’s Work or
Tenant’s Property. If, however, compliance requires structural work to the Premises or any work to
the Building Systems within and serving only the Premises, Tenant shall comply, at Tenant’s
expense, only if the obligation to comply arises from Tenant’s Work, Tenant’s Property or Tenant’s
manner of using the Premises (and, in such event, Landlord may, at Landlord’s option, perform the
work, at Tenant’s expense, to be paid within thirty (30) days following Tenant’s receipt of a bill
and other reasonable details and supporting information confirming the requirement of such work in
accordance with the provisions of this Section 11.1). If Tenant’s manner of using the
Premises requires work outside the Premises or to any Building System serving areas outside the
Premises, Tenant shall cease that manner of using the Premises unless Landlord, at Landlord’s
option acting reasonably, agrees to perform that work, at Tenant’s expense, to be paid within
thirty (30) days following Tenant’s receipt of a bill and other reasonable details and supporting
information confirming the requirement of such work in accordance with the provisions of this
Section 11.1.




     Section 11.2 Tenant shall promptly deliver to Landlord a copy of any communication or other
materials relating to the Premises, the Building (including the Building Systems), Tenant’s
Property or Tenant’s Work received by Tenant from, or sent by Tenant to, any Authority.



     Section 11.3 Landlord shall promptly cure any violation of Law caused by Landlord affecting
the Carling Campus to the extent the violation interferes with Tenant’s occupancy of the Premises
or the performance of Tenant’s Work.



          Article 12. Subordination; Estoppel Certificates




     Section 12.1 This Lease, and the rights of Tenant under this Lease, are subject and
subordinate in all respects and to all present and future mortgages on the Building, including all
modifications, extensions, supplements, consolidations and replacements thereof (“Mortgages”), and
all advances under any Mortgage, provided the Tenant receives a reasonable “non-disturbance
agreement” from any Mortgagee in respect of whose Mortgage this Lease is subordinated. This
Section is self-operative and no further instrument of subordination is required. Provided Tenant
receives the aforesaid non-disturbance agreement from the Mortgagee, Tenant shall, within fifteen
(15) days following receipt of Landlord’s request, sign, acknowledge and deliver any instrument
that Landlord or any mortgagee under a Mortgage (“Mortgagee”) may reasonably request to evidence
that subordination.



     Section 12.2 Landlord shall make commercially reasonable efforts at the request of Tenant to
obtain for the benefit of Tenant a subordination, non-disturbance and attornment agreement, from
the party seeking to obtain such subordination or attornment, in a commercially reasonable form
mutually satisfactory to the parties. Such subordination, non-disturbance and attornment agreement
shall be in recordable form and may be recorded on title to the Lands at Tenant’s election and
expense.



17









 





     Section 12.3 If any Mortgagee succeeds to the rights of Landlord under this Lease, then at the
request of the successor, Tenant shall attorn to the successor as Tenant’s landlord under this
Lease, and shall, within fifteen (15) days following Tenant’s receipt of a written request from
said Mortgagee, sign, acknowledge and deliver any instrument that the successor reasonably requests
to evidence the attornment. Upon such attornment, this Lease shall continue in full force and
effect as a direct lease between the Mortgagee and Tenant on all of the terms of this Lease, except
that the Mortgagee shall not be (a) liable for any previous act or omission of Landlord under this
Lease, or subject to any offset not expressly provided in this Lease, or (b) by any prepayment of
more than one month’s Rent, unless the prepayment has been approved in writing by the Mortgagee in
question. Upon Tenant’s receipt of an attornment request, Tenant shall be entitled to pay the Rent
to the Mortgagee and Landlord agrees that it shall have no claim of any nature or kind against
Tenant as a result of Tenant paying the Rent in accordance with such notice.



     Section 12.4 If any Mortgagee requires that any Mortgage be subordinate to this Lease, Tenant
shall, within fifteen (15) days following Tenant’s receipt of a request, sign, acknowledge and
deliver to Landlord instruments in form and substance reasonably requested by Landlord providing
for that subordination.



     Section 12.5 Landlord and Tenant shall, at any time and from time to time, within fifteen (15)
days following its receipt of a request from the other party, sign, acknowledge and deliver to the
requesting party or any other person designated by that party a certification (a) that this Lease
is in full force and effect and has not been modified (or, if modified, setting forth all
modifications), (b) the date to which the Rent has been paid, (c) stating whether or not, to the
best of its knowledge, there is then a Default or any event has occurred which, with the serving of
notice or the passage of time, or both, would give rise to a Default, or if Landlord is in default
under this Lease, and if so, setting forth the specific nature of same, and (d) to the best of its
knowledge, any other factual matters reasonably requested by the other party or any person
designated by the other party. Any certification delivered pursuant to this Section may be relied
upon by the requesting party or any other person designated by the other party.



          Article 13. Insurance




     Section 13.1 Tenant shall, at Tenant’s expense, maintain at all times during the Term and at
all times when Tenant is in possession of the Premises (a) commercial general liability insurance
in respect of the Premises, on an occurrence basis, with a combined single limit (annually and per
occurrence and location) of not less than [*] (which may consist of primary coverage of not less
than [*] per occurrence and [*] aggregate and umbrella coverage), naming Landlord and any Mortgagee
of the freehold interest in the Premises, if any, as additional insured, (b) property insurance in
an amount equal to 100 percent of full replacement value covering Tenant’s Work, Tenant’s Property
and the property of third parties located in the Premises, against fire and other risks included in
the standard form of property insurance, and (c) such other insurance as Landlord may reasonably
require to the extent that such coverage is then customarily required of tenants occupying similar
premises in similar buildings in the general vicinity of the Premises. Landlord shall have the
right at any time and from time to time, but not more frequently than once every year, to require
Tenant to increase the amount of the commercial general liability insurance required to be
maintained by Tenant under this Lease




 




			
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provided the amount shall not exceed the amount then customarily required of tenants occupying
similar premises in similar buildings in the general vicinity of the Premises.




     Section 13.2 Tenant shall deliver to Landlord (a) standard form certificates of insurance
evidencing the insurance required by this lease to be maintained by Tenant before the Commencement
Date (and with respect to any insurance required pursuant to Article 13, before the
commencement of any Tenant’s Work), and within fifteen (15) days before the expiration of any such
insurance. All required insurance (including insurance required pursuant to Article 5)
shall be primary, issued by companies with an A.M. Best rating of A-VII or better and contain a
provision whereby it cannot be canceled unless the carriers endeavor to provide Landlord with at
least thirty (30) days’ prior written notice of the cancellation. Tenant may carry any required
insurance under a blanket policy if that policy complies with the requirements of this Lease.



     Section 13.3 Landlord, acting reasonably, shall carry, at its expense, such insurance with
such deductibles and exclusions as would a prudent owner for the account and benefit of Landlord as
Landlord from time to time considers useful, expedient or beneficial, it being agreed and
understood however that such insurance shall include, the following:



          (a) insurance against “all risks” of loss or damage including sprinkler leakage and damage due
to flood or earthquake, covering all property owned by the Landlord or for which the Landlord is
responsible under this Lease relative to the Carling Campus including the buildings, the Common
Areas and the Premises, but excluding all Tenant’s Property and Tenant’s Work;




          (b) insurance against loss of Landlord’s gross profits including loss of Rent;




          (c) insurance against mechanical break down, explosion, rupture or failure of boilers,
pressure vessels, heating, ventilating and air conditioning equipment, electrical apparatus and
other like apparatus owned by Landlord; and




          (d) comprehensive general liability insurance with respect to Landlord’s operation of the
Carling Campus covering bodily injury, death and damage to tangible property of others.



Tenant shall not do or permit to be done any act which shall invalidate or be in conflict with
Landlord’s insurance policies, or increase the rates of insurance applicable to the Building. If,
solely as the result of a Default, the insurance rates for the Building increase, in addition to
any other obligation or liability of Tenant or any right or remedy of Landlord, Tenant shall
reimburse Landlord for the increased premiums, within fifteen (15) days following Tenant’s receipt
of Landlord’s written request.




     Section 13.4 Landlord and Tenant shall, to the extent obtainable, each procure a clause in, or
endorsement on, any property insurance carried by it, pursuant to which the insurance company
waives its right of subrogation against the other party to this Lease and its agents and employees
or consents to a waiver of the right of recovery against the other party to this Lease and its
agents and employees. If an additional premium is required for the waiver or consent, the other
party shall be advised of that amount and may, but is not obligated to, pay the same. If that
party elects not to pay the additional premium, the waiver or consent shall not be required in



19









 




favor of that party. Provided its right of full recovery under its insurance policy is not
adversely affected, Landlord and Tenant each hereby releases the other (and its agents and
employees) with respect to any claim (including a claim for negligence) it may have against the
other for damage or loss covered by its property insurance (including business interruption and
loss of rent).




     Section 13.5 The provisions of this Article shall apply to any subtenant or other occupant of
the Premises.



          Article 14. Casualty




     Section 14.1 Except to the extent that the damage is caused by Tenant or those for whom Tenant
is responsible in law, if (a) the Premises (including any Building System) are damaged by fire or
any other casualty (including where Tenant is deprived of reasonable access to the Premises or any
part of the Premises for a prolonged period of time, or the Premises or any part of the Premises,
are unusable by Tenant for the reasonable conduct of Tenant’s normal business in the Premises),
Tenant shall give prompt notice to Landlord. Subject to the provisions of this Article 14,
Landlord shall, at Landlord’s expense, repair the damage, excluding the damage to Tenant’s Work or
Tenant’s Property, to the extent of the insurance proceeds received or which would have been
received had Landlord maintained the insurance required by the terms of this Lease, in a manner
which is in all material respects reasonably comparable to the status of the Premises prior to the
occurrence of such damage; and (b) Tenant shall, at Tenant’s expense, promptly remove Tenant’s
Property from the Premises to the extent reasonably required by Landlord in connection with
Landlord’s repair of the damage. Until the date which is sixty (60) days following the date upon
which repairs to be performed by Landlord are substantially completed such that Tenant can access
and occupy the Premises, whether or not Tenant’s Work is complete, the Rent shall be reduced in
proportion to the area of the Premises to which Tenant shall not have reasonable access or which is
unusable by Tenant for the reasonable conduct of Tenant’s normal business in the Premises.



     Section 14.2 Except to the extent that the damage is caused by Tenant or those for whom Tenant
is responsible in law, if (a) the Premises or the Carling Campus are materially damaged by fire or
any other casualty, Landlord and Tenant shall each have the right, by notice to the other within
sixty (60) days following the date of the damage, to terminate this Lease. If this Lease is
terminated pursuant to this Section, the Term shall expire on the 60th day after the notice is
given (and any Rent paid by Tenant to Landlord for any period after that date shall be promptly
refunded by Landlord to Tenant) and during such period, the Rent payable by Tenant shall abate in
accordance with the provisions of Section 14.1 hereof. If Landlord and Tenant do not elect
to terminate this Lease pursuant to this Section 14.2, Landlord shall proceed to repair or
rebuild the Premises with due diligence and the provisions of Section 14.1 hereof shall
apply. For purposes of this Section 14.2, the Premises shall be deemed to be “materially
damaged” if the cost of repairing any such damage exceeds 25% of the replacement cost thereof or
the damage impacts 25% or more of the aggregate square footage of the Premises and in each case
cannot be repaired or rebuilt with reasonable diligence within six (6) months of the date of the
occurrence of such damage or destruction, in each case as reasonably determined by an independent
and reputable architect or engineer selected by Landlord.



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     Section 14.3 For greater certainty, the parties confirm that in the event this Lease is
terminated due to fire or other casualty under this Article 14, no Early Termination Fee is
payable to Tenant, and the Escrow Agent shall, in such circumstances, be instructed to release and
remit the Early Termination Fee funds to Landlord.



          Article 15. Expropriation or Condemnation




     Section 15.1 If as the result of a taking by expropriation or condemnation or similar legal
action of an Authority (a) all of the Premises, or so much thereof as renders the Premises wholly
unusable by Tenant, is taken, (b) a portion of the Building or the Land is taken, resulting in
Tenant no longer having reasonable access to or use of the Premises, (c) all or substantially all
of the Building or the Land is taken or (d) a portion of the Building is taken resulting in
Landlord’s determination to demolish or substantially renovate the Building, the Term shall expire
on the date of the vesting of title. In that event, the Rent shall be apportioned as of the date
of termination and any Rent paid by Tenant to Landlord for any period after that date shall be
promptly refunded by Landlord to Tenant.



     Section 15.2 Each party shall have the right to claim and recover from the expropriating
Authorities such compensation as may be separately awarded or recoverable. Landlord and Tenant
agree to inform each other fully as to their respective claims for compensation made by them in the
event of any expropriation and not to claim compensation on any basis inconsistent with this Lease
and to reasonably cooperate with each other in the prosecution of any proper separate claims.
Neither party shall compromise the claim of the other party without its prior written consent.



     Section 15.3 If a taking does not result in the termination of this Lease (a) Landlord shall,
at Landlord’s expense, as soon as practicable, subject to receipt of compensation award from the
expropriating authority, restore that part of the Premises, the Building or the Land not taken, so
that the Premises are usable which restoration shall, as necessary, include providing alternative
means of ingress, egress, and other common areas, and (b) from and after the date Tenant is
required by Law to vacate by reason of such taking, the Rent shall be reduced in the same
proportion as the area of the Premises, if any, which was taken.



     Section 15.4 For greater certainty, the parties confirm that in the event this Lease is
terminated due to expropriation or condemnation under this Article 15, no Early Termination
Fee is payable to Tenant, and the Escrow Agent shall, in such circumstances, be instructed to
release and remit the Early Termination Fee funds to Landlord.



          Article 16. Environmental Matters




     Section 16.1 Tenant shall notify Landlord immediately if it has knowledge of any environmental
contamination on or under the Land, Building, or Premises.



     Section 16.2 Tenant will afford site access to Landlord, where appropriate for specific site
requirements, for purposes of on-going environmental monitoring and remediation work.



     Section 16.3 Landlord represents and warrants that it has received no notice from any
Authority that the Premises do not comply in all material respects, as at the date of this Lease,



21









 




with all current applicable Environmental Laws. If an issue of non-compliance is found,
Landlord shall take such action as is necessary to bring such condition into compliance at
Landlord’s expense unless such non-compliance is due to the activities of Tenant (or those for whom
Tenant is in law responsible).




     Section 16.4 Tenant hereby indemnifies Landlord and each and every of its officers, directors,
employees, agents and shareholders and agrees to hold each of them harmless from and against any
and all Liabilities, including any Order, arising (directly or indirectly) out of or relating to
any Hazardous Materials contamination in, under or on the Premises which at any time or from time
to time may be paid, incurred or asserted against any of them for, with respect to or as a direct
or indirect result of, the presence on or under, or the escape, seepage, leakage, spillage,
discharge, emission or release from, the Premises of any Hazardous Materials, but only to the
extent caused by the act, omission or negligence of Tenant or anyone for whom it is in law
responsible. For greater certainty, Tenant shall have no liability for any Hazardous Materials
located in, on, under or upon the Building or any part thereof prior to the Commencement Date, or
which migrate to or under the Building from adjacent properties after the Commencement Date.



     Section 16.5 Landlord hereby (i) acknowledges that Tenant did not cause or contribute to, and
shall not be liable or responsible for, the currently or formerly existing Hazardous Materials
contamination in, under, at, near or migrating from, to or through the Carling Campus prior to the
Commencement Date; (ii) indemnifies Tenant and each and every one of its officers, directors,
employees, agents and shareholders and agrees to hold each of them harmless from and against (A)
any Liabilities, including any Order, arising (directly or indirectly) out of or relating to any
currently or formerly existing Hazardous Materials contamination in, under, at, near or migrating
from, to or through the Carling Campus prior to the Commencement Date and (B) if and to the extent
caused by Landlord, any Liabilities, including any Order, arising (directly or indirectly) out of
or relating to any Hazardous Materials contamination in, under, at, near or migrating from, to or
through the Carling Campus.



          Article 17. Assignment and Subletting




     Section 17.1 Subject to Section 17.7, Tenant shall not, without Landlord’s consent,
such consent not to be unreasonably withheld, conditioned or delayed: (a) assign (directly or
indirectly, by operation of law or otherwise), encumber or otherwise transfer this Lease or any
interest in this Lease, or (b) sublet or permit others to occupy all or any part of the Premises
(whether for desk space, mailing privileges or otherwise). The transfer, redemption or issuance
(by one or more transactions) of ownership interests of Tenant or any direct or indirect parent of
Tenant that is a controlled Affiliate of Ciena Corporation or its successor which results in 50
percent or more of the ownership interests of that person being held by persons other than Ciena
Corporation, its successor or their controlled Affiliates (“Change of Control”) shall be considered
an assignment of this Lease which requires Landlord’s consent, unless such ownership interests are
publicly traded on a national stock exchange or over the counter market. For the avoidance of
doubt, a change in control of Ciena Corporation shall not be deemed a Change of Control nor require
Landlord’s consent. Landlord’s consent to an assignment, subletting or occupancy shall not relieve
Tenant from any liability under this Lease or from obtaining Landlord’s consent to any further
assignment, subletting or occupancy.



22









 





     Section 17.2 Intentionally Deleted.



     Section 17.3 In the event that Tenant wishes to engage in an assignment of the Lease or a
sublet of the Premises which requires Landlord’s consent in accordance with this Article
17, it shall give Landlord notice of Tenant’s desire, accompanied by (i) an executed copy of
the proposed assignment (with an assumption agreement signed by the assignee in a form acceptable
to landlord, acting reasonably, (ii) a reasonably detailed description of the proposed assignee or
subtenant and its principals, the nature of its business and its proposed use of the Premises, and
(iii) current financial information with respect to the proposed assignee or subtenant, including
its most recent financial statements (and Tenant shall promptly deliver to Landlord such additional
information as Landlord reasonably requests).



     Section 17.4 Any permitted assignee or subtenant, including as permitted by Section
17.7, shall perform and observe all of Tenant’s covenants contained in this Lease, including
providing the same guaranty, if any, as provided by Tenant. Tenant shall be responsible for any
act or omission of any assignee or subtenant (or anyone claiming through any assignee or subtenant)
which violates this Lease, and that violation shall be considered a violation by Tenant.



     Section 17.5 If Landlord, provided it has acted in accordance with its rights under Section
17.1, denies consent to a proposed assignment or sublease, Tenant shall indemnify, defend and hold
harmless Landlord and Landlord’s managing agent, if any, against and from any and all loss,
liability, damages, costs and expenses (including reasonable counsel fees) resulting from any
claims that may be made against Landlord or Landlord’s managing agent, if any, by any proposed
assignee or subtenant or by any brokers or other person claiming a commission or similar
compensation in connection with the proposed assignment or sublease.



     Section 17.6 Tenant shall pay Landlord, within fifteen (15) days following payment to Tenant,
(a) all sums and other consideration in connection with an assignment, after Tenant recovers
therefrom all reasonable costs incurred by Tenant in connection with that assignment which have
been paid or are then due and payable; and (b) the excess, if any, of the rents, additional charges
or other consideration in connection with a sublease over the Rent allocable to the subleased
premises (which Rent shall be allocated equally throughout the Premises) accruing during the term
of that sublease after Tenant recovers therefrom all reasonable costs incurred by Tenant in
connection with that sublease which have been paid or are then due and payable. This Section shall
not apply to an assignment or a sublease described in Section 17.7.



     Section 17.7 Tenant may, without Landlord’s consent,



          (a) assign this Lease or sublet all or any part of the Premises to any person which, directly
or indirectly, controls, is controlled by, or is under common control with Tenant (which means the
ownership, directly or indirectly, of more than 50 percent of all voting ownership interests or the
possession, directly or indirectly, of the power to direct management), or permit any such person
to occupy all or any part of the Premises in each case in connection with the any Permitted Use of
the Premises;





23









 








          (b) assign this Lease to a purchaser of all or substantially all of the assets of Tenant, or




          (c) sublet to any person or persons up to [*] of the Rentable Area of the Premises in the
aggregate, provided that Landlord shall be entitled to [*] of the rents, additional charges or
other consideration in connection with a sublease over the Rent allocable to the subleased premises
(which Rent shall be allocated equally throughout the Premises) accruing during the term of that
sublease after Tenant recovers therefrom all reasonable costs incurred by Tenant in connection with
that sublease which have been paid or are then due and payable;



and provided further that (a) there is then no Default which is then subsisting, (b) Landlord is
given not less than fifteen (15) days prior notice of the assignment, sublet or occupancy,
including an executed original of all related documents, including an original assignment (with an
assumption signed by the assignee), sublease or permission, and proof reasonably satisfactory to
Landlord of the requisite control, and (c) the assignee or subtenant assumes in writing all the
obligations hereunder. No such assignment, subletting or occupancy shall relieve Tenant from any
liability under this Lease or from obtaining Landlord’s consent to any further assignment,
subletting or occupancy.




          Article 18. Access




     Section 18.1 Landlord shall have the right, without the same constituting an eviction or
constructive eviction of Tenant in whole or in part and without any abatement of the Rent or
liability to Tenant, to (a) place (and have access to) concealed ducts, pipes and conduits through
the Premises (without a material reduction or reconfiguration of the useable area of the Premises),
(b) access to the Premises where necessary for Landlord to carry out its obligations under this
Lease at such times mutually agreeable with Tenant and accompanied by a representative of Tenant,
on at least 48 hours prior notice (except in the case of an emergency or to avoid damage to persons
or property, in which case Landlord shall use reasonable efforts to contact the representative
designated by Tenant as its liaison for addressing emergencies on Tenant’s behalf prior to
accessing the Premises), (c) maintain or repair the Building (including the Building Systems) or
the Carling Campus; (d) change the name, number or designation by which the Building is known; and
(e) take all material into the Premises that may be required in connection with any of the matters
described in this Section. If in an emergency or to avoid damage to persons or property, Tenant is
not present when Landlord desires to enter the Premises and Landlord is unable to reach a Tenant
representative, Landlord or Landlord’s contractors may enter the Premises, by force, without
liability to Tenant.



     Section 18.2 If there is to be any excavation or construction adjacent to the Building, Tenant
shall permit Landlord or any agent of Landlord to enter the Premises on reasonable prior written
notice to perform such work as Landlord or that person deems necessary to protect the Building,
without any abatement of the Rent or liability to Tenant.



     Section 18.3 Except as may be provided in this Lease, all walls, windows and doors bounding
the Premises (including exterior walls of the Building, core corridor walls, and exterior doors and
entrances, other than surfaces facing the interior of the Premises and doors and entrances
servicing only the Premises), balconies, terraces, vaults, Building systems and all other




 




			
	[*]	 	Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission.
Confidential treatment has been requested with respect to the omitted portions.




24









 




portions of the Building are reserved to Landlord for Landlord’s use, are not part of the Premises, and
Landlord may have access thereto through the Premises.




     Section 18.4 Landlord acknowledges that any information delivered or received by Landlord from
Tenant or otherwise in accordance with the undertaking of its duties or the exercise of its rights
herein in respect of the business conducted by Tenant at the Premises shall remain confidential and
proprietary to Tenant, and Landlord agrees to hold and keep such information confidential as and to
the full extent provided herein. For greater certainty, “confidential information” refers to,
without limitation, all financial, technical, all analyses, inventories, correspondence, reports,
studies or other material when prepared by Tenant or its representatives. Landlord shall use
reasonable efforts to exercise Landlord’s rights to access the Premises under this Lease, including
this Section 18, in a manner which respects Tenant’s security requirements and provides
Tenant with at least 48 hours prior written notice of the exercise of such rights and which
minimizes interference with the conduct of Tenant’s business in the Premises and damage to the
Premises, Tenant’s Work and Tenant’s Property (all of which shall promptly be repaired by Landlord,
at its expense).



     Section 18.5 Except in the case of emergency or to avoid damage to persons or property, Tenant
shall be entitled to require that Landlord and any of its agents and employees be accompanied by
representatives of Tenant when accessing the Premises. Notwithstanding anything in this Article to
the contrary, Landlord shall use commercially reasonable efforts to minimize any interference and
disruption to Tenant’s business caused by the exercise of its rights under this Article 18.



          Article 19.Default




     Section 19.1 Each of the following is a “Default” by Tenant under this Lease:



          (a) Tenant fails to pay when due any Rent and the failure continues for ten (10) days
following Landlord’s written notice (which notice shall also be considered any demand required by
any Law). If, however, Landlord gives such a written notice twice in any consecutive 12-month
period, any additional failure to pay any Rent when due within that 12-month period shall be
considered an immediate Default (without the requirement of any notice by Landlord);




          (b) Tenant fails to comply with Article 17;




          (c) Tenant fails to comply with any other teen of this Lease and the failure continues for
thirty (30) days following Landlord’s notice. If, however, compliance cannot, with diligence,
reasonably be fully accomplished within that 30-day period, Tenant shall have an additional 30-day
period to comply, provided Tenant promptly commences compliance and thereafter pursues compliance
to completion with all due diligence;




          (d) Tenant institutes, or has instituted against it any legal action seeking any relief from
its debts under any Law which is not dismissed within sixty (60) days; a receiver, trustee,
custodian or other similar official is appointed for it or for all or a substantial portion of its
assets; Tenant becomes insolvent or is unable to pay its debts or fails or admits in writing its






25









 







inability generally to pay its debts as they become due; or Tenant commits any other act indicating
insolvency;




          (e) Tenant commits an act of default under the Additional Premises Lease which subsists beyond
any applicable cure period provided for therein;




          (f) Tenant fails to comply with requirements of Section 21.1 to ensure the Security
continues to represent three (3) month’s Rent throughout the Term.




     Section 19.2 If a Default occurs, Landlord may at any time during the continuance of the
Default give notice to Tenant that this Lease shall terminate on the date specified in that notice,
which date shall not be less than five (5) days after Landlord’s notice to Tenant. If Landlord
gives that notice, the Term shall expire on the date set forth in that notice (but Tenant shall
remain liable as provided in this Lease).



     Section 19.3 If Tenant is in arrears in the payment of the Rent, Tenant waives Tenant’s right,
if any, to designate the items against which any payments made by Tenant are to be credited, and
Landlord may apply any payments made by Tenant to any items Landlord sees fit.



          Article 20. Remedies




     Section 20.1 If this Lease is terminated pursuant to Article 19 or Landlord re-enters
or obtains possession of the Premises by summary proceedings or any other legal action (which
Landlord may do without further notice and without liability or obligation to Tenant or any
occupant of the Premises), all of the provisions of this Section shall apply (in addition to any
other applicable provisions of this Lease).



          (a) Tenant (and all other occupants) shall vacate and surrender to Landlord the Premises in
accordance with this Lease.




          (b) Landlord, at Landlord’s option, may (i) re-let the Premises, or any portion of the
Premises, from time to time, in the name of Landlord, Tenant or otherwise, as determined by
Landlord, to any person and on any terms, but Landlord shall have no obligation to re-let the
Premises, or any portion of the Premises, or to collect any rent (and the failure to re-let the
Premises, or any portion of the Premises, or to collect any rent shall not impose any liability or
obligation on Landlord or relieve Tenant of any obligation or liability under this Lease), and (ii)
make any changes to the Premises as Landlord, in Landlord’s judgment, considers advisable or
necessary in connection with a re-letting, without imposing any liability or obligation on Landlord
or relieving Tenant of any obligation or liability under this Lease.




          (c) Tenant shall pay Landlord all Rent payable to the date on which this Lease is terminated
or Landlord re-enters or obtains possession of the Premises.




          (d) Tenant shall also pay to Landlord, as damages, any deficiency between (i) the aggregate
Rent for the period which otherwise would have constituted the unexpired portion of the Term to the
Fixed Expiration Date (including any increases in additional rent for each year thereof in
accordance herewith) and any expenses incurred by Landlord in connection with the termination,
reentry or obtaining of possession, and the re-letting of the Premises, including all






26









 







repossession
costs, brokerage commissions, reasonable attorneys’ fees and disbursements, alteration costs and
other expenses of preparing the Premises for re-letting and (ii) the Rent, if any, applicable to
that period collected under any re-letting of any portion of the Premises.
Tenant shall pay any deficiency in monthly installments on the days specified in this Lease
for payment of installments of the Fixed Rent, and Landlord shall be entitled to recover from
Tenant each monthly deficiency as the same arises. No suit to collect the deficiency for any month
shall prejudice Landlord’s right to collect the deficiency for any subsequent month. Tenant shall
not be entitled to any rents payable (whether or not collected) under any re-letting, whether or
not those rents exceed the Rent.




          (e) Landlord may recover from Tenant, and Tenant shall pay Landlord, on request, in lieu of
any further deficiency pursuant to paragraph (d) of this Section (as liquidated damages) the amount
by which (i) the unpaid Rent for the period which otherwise would have constituted the unexpired
portion of the Term (including any increases in additional rent for each year thereof in accordance
herewith) exceeds (ii) the then fair and reasonable rental value of the Premises, including the
additional rent for the same period, both discounted to present value at the annual rate of
interest (the “Base Rate”) publicly announced by the Royal Bank of Canada (or any successor
thereto) as its “base rate” on the date of the Default in question, or such other term as may be
used by the Royal Bank of Canada from time to time for that rate (and if no longer publicly
announced, then a similar rate selected by Landlord). If, before presentation of proof of
liquidated damages, Landlord re-lets the Premises or any portion of the Premises for any period
pursuant to a bona fide lease with an unrelated third party, the net rents payable in connection
with the re-letting shall be considered to be the fair and reasonable rental value for the Premises
or the portion of the Premises re-let during the term of the re-letting. If Landlord re-lets the
Premises, or any portion of the Premises, together with other space in the Building, the rents
collected under the re-letting and the expenses of the re-letting shall be equitably apportioned
for the purposes of this Article.




          (f) Nothing contained in this Lease shall be considered to limit or preclude the recovery by
Landlord from Tenant of the maximum amount allowed to be obtained as damages or otherwise by any
Law.




     Section 20.2 Tenant hereby waives (a) the service of any notice of intention to re-enter or
obtain possession of the Premises or to institute any legal action in connection therewith, except
as provided in this Lease and (b) on its own behalf and on behalf of all persons claiming under
Tenant, including all creditors, any rights Tenant and all such persons might otherwise have under
any Law to redeem the Premises, to re-enter or repossess the Premises, or to restore this Lease,
after (i) Tenant is dispossessed pursuant to any Law or by any Authority, (ii) Landlord reenters or
obtains possession of the Premises pursuant to any legal action, or (iii) the Expiration Date,
whether by operation of law or pursuant to this Lease (including the occurrence of the Expiration
Date by Landlord terminating this Lease pursuant to Section 19.2). The words “re-enter,”
“re-entry” and “re-entered” as used in this Lease shall not be considered to be restricted to their
technical legal meanings. Landlord shall have the right to enjoin any Default and the right to
invoke any remedy allowed by any Law in addition to any remedies provided in this Lease. All
remedies provided in this Lease are cumulative and Landlord’s right to invoke, or invocation of,
any remedy shall not preclude Landlord from invoking any other remedy.



27









 





     Section 20.3 For greater certainty, the parties confirm that in the event this Lease is
terminated due to a Default by the Tenant under this Lease, no Early Termination Fee is payable
to Tenant, and the Escrow Agent shall, in such circumstances, be instructed to release and
remit the Early Termination Fee funds to Landlord.



     Section 20.4 If there is a Default, or if Tenant fails to comply with any obligation under
this Lease which, in Landlord’s reasonable opinion creates an emergency or danger to the health or
safety of any person or risk of damage to property, Landlord may, but is not obligated to, cure the
Default or, without notice, cure the failure to comply, for the account of Tenant. All amounts
incurred by Landlord in that connection, and any amounts (including reasonable attorneys’ fees and
disbursements) in instituting, prosecuting or defending any legal action by or against Tenant, or
in connection with any dispute under this Lease, in which Landlord prevails, with interest thereon
at the Default Rate, shall be paid by Tenant to Landlord within fifteen (15) days following
Tenant’s receipt of Landlord’s request. Landlord shall promptly reimburse Tenant for any
reasonable legal fees and disbursements incurred by Tenant in connection with any legal action or
other dispute with Landlord under this Lease, in which Tenant prevails.



     Section 20.5 The failure of Landlord to seek redress for a Default, or of Landlord or Tenant
to insist upon the strict performance of any term of this Lease, shall not prevent Landlord from
redressing a subsequent Default or Landlord or Tenant from thereafter insisting on strict
performance. The receipt by Landlord of the Rent with knowledge of a Default or Tenant’s failure
to strictly perform under this Lease shall not be deemed a waiver of the Default or failure. No
term of this Lease shall be considered waived by Landlord or Tenant unless the waiver is in a
writing signed by the waiving party. No payment by Tenant or receipt by Landlord of a lesser
amount than the Rent shall be considered other than on account of the next installment of the Rent,
or as Landlord may elect to apply same. No endorsement or statement on any check or letter
accompanying any check or payment shall prevent Landlord from cashing the check or otherwise
accepting the payment, without prejudice to Landlord’s right to recover the balance of the Rent or
pursue any other remedy.



     Section 20.6 If Tenant fails to pay any installment of the Fixed Rent on the first day of the
month or any Additional Rent when due, in addition to any other right or remedy of Landlord, Tenant
shall pay to Landlord within fifteen (15) days following Landlord’s written notice interest at the
rate (the “Default Rate”) which is the lesser of the rate of 5% per annum above the Base Rate or
the maximum legal interest rate permitted under the circumstances, on the amount unpaid, from the
date the payment was first due to and including the date paid.



          Article 21. Security




     Section 21.1 Tenant has deposited with Landlord, as security for Tenant’s compliance with this
Lease, the Security by a standby letter of credit on the terms, and substantially in the form,
attached to this Lease as Exhibit “D”, issued by a bank listed under Schedule I, Schedule II or
Schedule III of the Bank Act (Canada) (the “Letter of Credit”). If there is a Default, Landlord
may use all or any portion of the Security, only as necessary, to cure the Default or for the
payment of any other amount due and payable from Tenant to Landlord in accordance with this Lease.
Tenant shall, within thirty (30) days following Landlord’s written notice, deposit with Landlord in
cash or by a Letter of Credit an amount sufficient to restore the full amount of



28









 




the Security (without giving consideration to any interest accrued on the Security) following a Default.
Landlord may assign the Security to a permitted assignee of this Lease, or to a
Mortgagee of the Carling Campus. Landlord shall not be required to exhaust its remedies
against Tenant or the Security before having recourse to Tenant, the Security or any other security
held by Landlord, or before exercising any right or remedy, and recourse by Landlord to any one of
them, or the exercise of any right or remedy, shall not affect Landlord’s right to pursue any other
right or remedy or Landlord’s right to proceed against the others. If there is then no uncured
Default, the Security and any accrued and unpaid interest thereon, or any balance, shall be paid or
delivered to Tenant promptly after the Expiration Date and Tenant’s vacating of the Premises in
accordance with this Lease. If Landlord’s interest in the Building is sold or leased, Landlord
shall transfer the Security and any accrued and unpaid interest thereon, or any balance, to the new
landlord and, upon such transfer and delivery of an agreement in writing in favor of Tenant wherein
the assignee assumes all obligations of Landlord under this Lease whenever arising (including in
respect of the Security), the assignor shall thereupon be released by Tenant from all liability for
the return of the Security or any interest (and Tenant agrees to look solely to the assignee for
the return of the Security or any interest).




     Section 21.2 Given Tenant has elected to post the Security by way of a Letter of Credit, the
following provisions of this Section shall also apply (in addition to the other provisions of this
Article):



          (a) If the bank issuing the Letter of Credit shall notify Landlord that the term of the Letter
of Credit shall not be renewed, Tenant shall, at least thirty (30) days prior to the expiration
date of the Letter of Credit, replace the Letter of Credit with a new Letter of Credit, having an
initial expiration date at least one year from the date of the new Letter of Credit. If Tenant
fails to so renew and does not otherwise provide cash by the date that is fifteen (15) days prior
to expiry, Landlord may draw on the Letter of Credit and hold the cash and all interest earned
thereon as Security hereunder.




          (b) If, for any reason other than Landlord’s failure to comply with the requirements of the
Letter of Credit, the bank issuing the Letter of Credit shall fail or refuse to honor any demand,
Tenant shall within fifteen (15) days following Landlord’s written notice to Tenant of such failure
or refusal, at Landlord’s option, either (i) deposit with Landlord the Security in cash or (ii)
replace the Letter of Credit with a new Letter of Credit (having an initial expiration date at
least one year from the date of the new Letter of Credit).




          (c) If Landlord shall transfer its interest in the Building, Tenant shall, at the request of
the transferor or transferee, replace or amend the Letter of Credit within fifteen (15) days
following such request, so that the transferee is named as the beneficiary. Any reasonable
transfer fee or charge imposed by the bank issuing the Letter of Credit shall be reimbursed to
Landlord (or, at Landlord’s option, paid) by Tenant within fifteen (15) days following Landlord’s
request.




          (d) If there shall be a Default, in addition to any other right or remedy of Landlord,
Landlord shall have the right, to immediately draw the full amount of the Letter of Credit and then
hold the cash and all interest thereon as Security hereunder and apply such amounts in accordance
with the provisions of Section 21.1 hereof.







29









 








          Article 22. Broker




     Section 22.1 Except for fees and commissions that will be paid by Tenant to CB Richard Ellis
for which Tenant hereby indemnifies Landlord, no broker is entitled to any fee or commission in
connection with the transactions contemplated by this Lease based upon arrangements made by or on
behalf of Tenant or any of its affiliates. Except for fees and commissions that will be paid by
Landlord for which Landlord hereby indemnifies Tenant, no broker is entitled to any fee or
commission in connection with the transactions contemplated by this Lease based upon arrangements
made by or on behalf of Landlord or any of its affiliates.



          Article 23. Notices




     Section 23.1 Except as may be expressly provided in this Lease, all notices and other
communications under this Lease must be in writing and sent by nationally recognized overnight
courier service or registered or certified mail (return receipt requested), addressed to Landlord
or Tenant at its Notice Address.



     Section 23.2 Any notice or other communication sent as provided in this Article shall be
effective (a) on the date received (or rejected) if sent overnight courier service, or (b) two
Business Days after mailing by registered or certified mail.



     Section 23.3 Any notice or other communication given by Landlord to Tenant in accordance with
this Article may be signed and given by Landlord’s managing agent, if any, with the same force and
effect as if signed and given by Landlord.



          Article 24. Representations and Liability




     Section 24.1 Neither Landlord nor any of Landlord’s agents, employees or representatives has
made any warranties, representations, statements or promises with respect to the Premises, the
Building, the Land, the Building systems, any additional rent, any Law or any other matter, unless
expressly set forth in this Lease. This Lease, Escrow Agreement and the ASA contain the entire
agreement between Landlord and Tenant with respect to the subject matter of this Lease, and any
previous agreements between Landlord and Tenant are merged in this Lease, which alone expresses
their agreement. Tenant is entering into this Lease after full investigation, and is not relying
on any warranties, representations, statements or promises made by Landlord or any other person not
expressly set forth in this Lease or in the ASA, and is not acquiring any rights of any nature, by
implication or otherwise, except as expressly set forth in this Lease.



     Section 24.2 No act or omission of Landlord or Tenant, or their respective employees, agents
or contractors, including the delivery or acceptance of keys, shall be deemed an acceptance of a
surrender of the Premises, and no agreement to accept such surrender shall be valid unless it is in
a writing signed by Landlord. Any employee of Landlord, Landlord’s managing agent, if any, or the
Building to whom any property is entrusted by or on behalf of Tenant shall be deemed to be acting
as Tenant’s agent with respect to that property and neither Landlord nor Landlord’s managing agent,
if any, shall be liable for any damages to or loss of property of Tenant or others entrusted to
employees, agents or contractors of Landlord, Landlord’s managing agent, if any, or the Building.



30









 





     Section 24.3 Neither Landlord nor Landlord’s managing agent, if any, shall be liable for any
injury, damage or loss to Tenant, Tenant’s Property, Tenant’s Work, Tenant’s business or to any
other person or property resulting from any cause, except to the extent caused by the negligence
act or omission of Landlord, Landlord’s managing agent, if any, or their respective employees,
agents or contractors, subject to Section 13.4.



     Section 24.4 If, at any time or from time to time, any windows of the Premises are temporarily
closed, blocked or darkened for any reason, or permanently closed, blocked or darkened if required
by any Law or due to any construction on property adjacent to the Building by any person, including
Landlord or any person in which Landlord has an interest (a) Landlord shall not be liable for any
loss or damage Tenant may sustain thereby, (b) Tenant shall not be entitled to any compensation or
abatement of the Rent, (c) Tenant shall not be relieved of its obligations under this Lease and (d)
it shall not constitute an eviction or constructive eviction of Tenant from the Premises.



     Section 24.5 Subject to the provisions of Section 27.1, in the event of a transfer of
the Building (a) the Landlord shall be and hereby is relieved of all obligations and liabilities of
Landlord under this Lease accruing after the effective date of the assumption by the transferee;
and (b) the transferee shall be deemed to have assumed all of Landlord’s obligations and
liabilities under this Lease effective from and after the effective date of the transfer.



     Section 24.6 Landlord, its partners, members, shareholders, officers, directors and
principals, disclosed or undisclosed, have no personal liability under or in connection with this
lease. Tenant shall look only to Landlord’s interest in the Premises and the Carling Campus for
the satisfaction of Tenant’s remedies or to collect any judgment requiring the payment of money by
Landlord under or in connection with this lease, and no other assets of Landlord or such persons
shall be subject to lien, levy, execution or other enforcement procedure for the satisfaction of
Tenant’s remedies or the collection of any judgment under or in connection with this lease. If
Tenant acquires a lien on such other property or assets by judgment or otherwise, Tenant shall
promptly release that lien by signing, acknowledging and delivering to Landlord any instrument,
prepared by Landlord, required for the lien to be released.



     Section 24.7 Intentionally deleted



     Section 24.8 It is understood and agreed that whenever and to the extent that Landlord or
Tenant shall be unable to fulfill or shall be delayed or restricted in the fulfillment of any
obligation hereunder in respect of the supply or provision of any service or utility or the doing
of any work or the making of any repairs by reason of delays caused by acts of God, war, civil
riot, insurrection, strike or labour dispute not caused by the party claiming same, unusual delays
in transportation of materials, unusual government delays, or delays due to condemnation, fire or
other unavoidable casualty, being unable to obtain the material, goods or equipment required to
enable it to fulfill such obligation (collectively and individually, “Unavoidable Delay”) then,
provided the party claiming a benefit of a delay due to Unavoidable Delay shall have the
obligations to: (i) notify the other party within a reasonable time period after such delay
commences; and (ii) use its best efforts to minimize the duration of such delay and the effect of
the delay, Landlord or Tenant (as the case may be) shall be relieved from the fulfillment of such
obligation during the period of such delay and the other party shall not be entitled to



31









 




compensation for any inconvenience, nuisance or discomfort thereby occasioned, provided that
in no event will Tenant be relieved of its obligation to pay Rent. Notwithstanding the foregoing,
the inability to procure funds shall not be considered to be or to result in an event of
Unavoidable Delay.




     Section 24.9 Tenant shall not perform or permit to be performed any act which may subject
Landlord or Landlord’s managing agent, if any, to any liability. Tenant shall, to the extent not
caused by the negligence or willful misconduct of Landlord or its contractors or agents, indemnify,
defend and hold harmless Landlord and Landlord’s managing agent, if any, from and against (a) all
claims arising from any act or omission of Tenant, its contractors, agents, employees, invites or
visitors, (b) all claims arising from any accident, injury or damage to any person or property in
the Premises during the Term or when Tenant is in possession of the Premises, and (c) Tenant’s
failure to comply with Tenant’s obligations under this Lease (whether or not a Default), and all
liabilities, damages, losses, fines, costs and expenses (including reasonable attorneys’ fees and
disbursements) incurred in connection with any such claim or failure.



          Article 25. End of Term




     Section 25.1 On the Expiration Date (a) Tenant (and all other occupants) shall vacate and
surrender the Premises, broom clean, in good order and condition, and with interior finished
including but not limited to carpets and other floor finishes, window coverings, ceilings and paint
in substantially the same condition as at the Commencement Date, except for ordinary wear and tear
and damage by fire and other casualty for which Tenant is not responsible under this Lease, and
otherwise as may be required by this Lease, including if required by Landlord, removal of Tenant’s
Work and Tenant’s Property. Tenant shall be under no obligation to return the Premises to base
building standard. For greater certainty, Landlord acknowledges and agrees that Tenant shall not
be obligated or responsible, under any circumstance, for the removal or restoration of any
installations, alterations, partitions or improvements of any kind whatsoever existing in, on or
under the Premises as of the Commencement Date, other than to repair any damage caused by the
removal of Tenant’s Work and Tenant’s Property. If the last day of the Term is not a Business Day,
this Lease shall expire on the immediately preceding Business Day. Should Tenant fail to yield up
space in accordance with its obligations, Landlord may carry out works on behalf of Tenant and
recover any costs incurred in doing so. Tenant waives, for itself and for any person claiming
under Tenant, any right which Tenant or any such person may have to a stay of proceedings.



     Section 25.2 If the Premises are not vacated and surrendered in accordance with this Lease, on
the date required by this Lease, Tenant shall be liable to Landlord for (a) all losses, costs,
liabilities and damages which Landlord incurs by reason thereof, including reasonable attorneys’
fees, and (b) per diem use and occupancy in respect of the Premises equal to 150% of the then
current Rent payable under this Lease (which Landlord and Tenant presently agree is the Rent to
which Landlord would be entitled, is presently contemplated by them as being fair and reasonable
under such circumstances and is not a penalty) until Tenant vacates and surrenders the Premises in
accordance with this Lease. Tenant shall indemnify, defend and hold harmless Landlord against all
claims made by any succeeding tenants against Landlord or otherwise resulting from the failure of
Tenant (and all other occupants) timely to vacate and surrender the



32









 




Premises in accordance with this Lease. In no event, however, shall this Section be construed
as permitting Tenant (and all other occupants) to remain in possession of the Premises after the
Expiration Date. Landlord and Tenant agree that any statutory right to hold over after the
expiration of the term is expressly waived in accordance with applicable Laws.




     Section 25.3 Any obligation of Landlord or Tenant under this Lease which by its nature or
under the circumstances can only be, or by the terms of this Lease may be, performed after the
Expiration Date and any liability for a payment with respect to any period ending on or before the
Expiration Date, unless otherwise set forth in this Lease, shall survive the Expiration Date.



          Article 26. Tenant’s Self-Help Remedy




     Section 26.1 While the Landlord is Nortel Networks Technology Corporation, or any entity
affiliated with Nortel Networks Technology Corporation or Nortel Networks Limited, and except in
the case of an Unavoidable Delay, if Landlord shall default in the performance or observance of any
obligation or condition in this Lease on its part to be performed or observed which results in a
Material Interruption (as hereinafter defined) and shall not cure such default within two (2)
Business Days after notice from Tenant specifying the default (or shall not within such period have
commenced to cure the default and be pursuing the cure of the default with due diligence), Tenant
may, at its option, without waiving any claim for damages for the default permitted under this
Lease, at any time thereafter, and on written notice to Landlord, take such steps as are necessary
to cure such default. Tenant shall submit detailed invoices to Landlord for the costs incurred by
Tenant to cure such default of Landlord, and if Landlord fails to pay the costs so invoiced, or to
provide notice to Tenant denying that it has committed a default or responsibility for the costs so
invoiced (which notice must include reasonable detail of the grounds on which Landlord is
supporting such assertion) and request an arbitration of the issue pursuant to Section 26.2
within fifteen (15) days after its receipt of the aforesaid invoice, Tenant shall have the right to
deduct such costs, and interest thereon, from the amounts then owed for any Rent due or to become
due by Tenant to Landlord under this Lease until the invoice amounts are satisfied in full
(“Set-off Right”). Tenant’s right to cure a default of Landlord under this Section 26.1
shall not preclude it from pursuing any other rights available to it under this Lease or at law in
the event that the Set-off Right is insufficient to compensate Tenant for its costs and expenses
resulting from Landlord’s default under this Section 26.1 (it being agreed that in no event
shall Landlord be responsible for indirect, consequential damages or losses of intangible
property). For purposes of this Section 26.1, “Material Interruption” means any
circumstance, other than an Unavoidable Delay, a casualty under Article 14 or an Expropriation or
Condemnation under Article 15, caused by a default by Landlord which would prevent or impede
Tenant’s access to or ability to conduct business from the Premises in a material manner (such as,
loss or interruption of utilities or failure of any critical Building System).




Landlord grants to Tenant a non-exclusive right on, over, within and across the Common Areas
for purposes of exercising the self-help remedy hereinbefore provided.



     Section 26.2 If Landlord denies that it has committed a default or disputes responsibility for
the costs claimed by Tenant pursuant to Section 26.1, then Landlord shall, within fifteen
(15) days after receipt of an invoice from Tenant in respect of the claim under Section
26.1, request that the matter be resolved as follows:



33









 






	 	(a)	 	Negotiations — Each of the Parties hereto will attempt in good
faith to resolve any dispute between them arising out of or relating to or in
connection with the an alleged Material Interruption caused by a default of
Landlord (each, a “Dispute”) promptly by negotiations between representatives
of the relevant parties who have authority to settle the Dispute, as follows:






	 	(i)	 	The “disputing” party or parties, as the case
may be, (the “Disputing Party” or a “party”) will give the other party
or parties, as the case may be, (the “Receiving Party” or a “party”)
written notice of the Dispute in question. Within 2 Business Days
after receipt of such notice, the Receiving Party shall submit to the
Disputing Party a written response. Each such notice and response
shall not exceed three pages and shall include:






	 	1)	 	a statement of each party’s
understanding of the issue(s) in the Dispute, and
	 
	 	2)	 	the name and title of the
individual who will represent that party at the negotiation.






	 	(ii)	 	The representatives and/or their counsel shall
meet at a mutually acceptable time and place within 2 Business Days of
the date of the Disputing Party’s receipt of the Receiving Party’s
response and thereafter as often as they reasonably deem necessary to
exchange relevant information and to attempt to resolve the Dispute.






	 	(b)	 	Arbitration — If a Dispute has not been resolved within 6
Business Days of the receipt by the Receiving Party of the Disputing Party’s
notice referred to in Section 26.2(a)(i) hereof, or if the Receiving
Party will not meet within the 2 Business Day period as contemplated in
Section 26.2(a)(ii) hereof (the earlier of which is the “Submission
Date”), the Dispute shall be finally settled by arbitration in accordance with
the provisions of the Arbitration Act, 1991 (Ontario) and any amendments
thereto. The following rules shall apply to the arbitration:






	 	(i)	 	The arbitration tribunal shall consist of one
arbitrator (“Arbitrator”) appointed by mutual agreement of the
Disputing Party and the Receiving Party or, in the event of their
failure to agree on and appoint an arbitrator within 10 days, either
party may request ADR Chambers Inc. (including its successor), or, if
such entity does not exist, counsel to the Disputing Party and counsel
to the Receiving Party, to provide a list of 5 qualified arbitrators.
Within 2 Business Days of their receipt of the list, the Disputing
Party and the Receiving Party shall independently rank the proposed
candidates, shall simultaneously exchange rankings, and shall select as
the Arbitrator the individual receiving the highest




34









 






	 	 	 	combined ranking who is available to serve. If either party does not
rank the proposed candidates and provide a copy of the ranking to the
other party, the party who does rank the proposed candidates and does
provide a copy of the ranking to the other party will be entitled to
select the Arbitrator.
	 
	 	(ii)	 	The Arbitrator shall be instructed that time is
of the essence in proceeding with his or her determination of any
Dispute.
	 
	 	(iii)	 	The Disputing Party and the Receiving Party
will agree, in consultation with the Arbitrator, on the rules for the
arbitration within 5 days of the selection of the Arbitrator. Absent
agreement within such time period to the contrary, the following rules,
designed to save time and expense for the parties, will apply:






	 	1)	 	The arbitration hearing shall be
held within 10 days of the date of selection of the Arbitrator;
	 
	 	2)	 	Pleadings shall be no more than 5
pages in length;
	 
	 	3)	 	Each party will provide to the
other access to any documents that may be relevant to the
Arbitration. Each party will also provide to the other a list
and copies of up to (but not exceeding) 15 documents that such
party intends to rely on at the arbitration;
	 
	 	4)	 	Each party will be entitled to
oral discovery of up to 2 representatives of the other party if
it deems it appropriate. Each party may only discover each such
representative of the other party for a maximum of three hours.
Any questions refused will be put to the Arbitrator for the
Arbitrator’s determination as to whether the questions are
appropriate and relevant;
	 
	 	5)	 	At the hearing, opening argument
will be limited to one half hour per party;
	 
	 	6)	 	Each party may produce up to two
witnesses for direct examination. The total time permitted for
direct examination (whether one or two witnesses are produced)
will be two hours. Total time for cross-examination will also
be two hours for each party;
	 
	 	7)	 	Hearsay evidence will be
admissible and its weight will be determined by the Arbitrator;
	 
	 	8)	 	Each party may introduce any of
its 15 documents through either of its witnesses. The other
party may, if appropriate,




35









 






	 	 	 	challenge the authenticity of any document produced through
such witnesses;
	 
	 	9)	 	Closing argument will be limited
to one hour for each party; and
	 
	 	10)	 	The Arbitrator will attempt to
produce a decision within 7 days of the conclusion of the
arbitration, and written reasons within 10 days of the
Arbitration.






	 	(iv)	 	The arbitration shall be conducted in English
and shall take place in Ottawa, Ontario.
	 
	 	(v)	 	The arbitration award shall be given in writing
and shall be final, and binding on the Disputing Party and the
Receiving Party, not subject to any appeal, and shall deal with the
question of costs of the arbitration and all matters related thereto.
In his or her award of costs, the Arbitrator may consider each party’s
effort to resolve the Dispute through negotiation, and any settlement
offer made. If either party has refused to participate in the
negotiation contemplated in Section 26.2(a) hereof, there shall
be a presumption that solicitor and client costs on a full indemnity
basis shall be awarded against that party refusing to participate,
regardless of the outcome of the arbitration.
	 
	 	(vi)	 	Judgment upon the award rendered may be entered
into any court having jurisdiction, or application may be made to such
court for judicial recognition of the award or an order for enforcement
thereof, as the case may be.






	 	(c)	 	Exclusive Procedure for Settling Disputes — The procedures
specified in this Section 26.2 are the only procedures for the
resolution of any Dispute, no party shall have recourse to the courts in
respect thereof other than in the limited circumstances provided for in this
Section 26.2. If any party attempts to have issues resolved in court
that should properly be resolved pursuant to this Section 26.2, the
parties agree that this Section 26.2 can be used to stay any such
proceedings. However, before or during the time that the Disputing Party and
the Receiving Party follow the procedures specified in this Section
26.2 above, either party may make application to the appropriate court for
a preliminary injunction or other preliminary judicial relief if such party
reasonably believes that such a step is necessary to avoid irreparable damage
or harm, Even if either party takes such action, both parties will continue to
participate in good faith in the procedures specified in this Section
26.2 above.





     Section 26.3 Subject to the provisions of Section 26.4, if the Premises are sold to
any person not affiliated with Landlord or Norte] Networks Limited (“New Landlord”) and the



36









 




Early Termination Right under Section 27.1 has not been exercised (or if the Early
Termination Right has been exercised and pending the expiry of the Early Termination Notice Period
under Section 27.1), all of the provisions of Sections 26.1 and 26.2 shall
be applicable, mutatis mutandis, to a default by the landlord which results in a Material
Interruption and a resolution of a dispute in connection therewith by negotiation or arbitration,
save and except that upon delivery of notice to Tenant confirming the payment of [*] into the
Landlord Security Account, as hereinafter provided, Tenant’s Set-off Right against Rent in
accordance with Section 26.1 shall be extinguished and of no further force or effect, and
the following provisions shall apply in lieu thereof:




          (a) At the time of the sale of the Campus, a sum of money equivalent to [*] shall be deposited
into an interest bearing escrow account of the Escrow Agent by Landlord or the New Landlord to
represent the full extent of security for the performance of the New Landlord’s obligations under
this Lease (“Landlord Security Account”);




          (b) Except in the case of an Unavoidable Delay, if the New Landlord shall default in the
performance or observance of any obligation or condition in this Lease on its part to be performed
or observed which results in a Material Interruption and shall not cure such default within two (2)
Business Days after Notice from Tenant specifying the default (or shall not within such period
commence to cure the default and thereafter be pursuing the cure of the default with due
diligence), Tenant may, at its option, without waiving any claim for damages for the default
permitted under this Lease, at any time thereafter, and on written notice to the New Landlord, take
such steps as are necessary to cure such default. Tenant shall submit detailed invoices to the New
Landlord for the costs incurred by Tenant to cure such default of the New Landlord, and if the New
Landlord fails to pay the costs so invoiced, or to provide notice to Tenant denying that it has
committed a default or responsibility for the costs so invoiced (which notice must include
reasonable detail of the grounds on which Landlord is supporting such assertion) and request an
arbitration of the issue in accordance with the provisions of Section 26.2 within fifteen
(15) days after its receipt of the aforesaid invoices, Tenant shall have the right to unilaterally
instruct and direct the Escrow Agent to pay Tenant the costs so invoiced from the Landlord Security
Account.




     Section 26.4 Notwithstanding the provisions of Section 26.3, in the event that the New
Landlord has, or is affiliated with entities which have, a credit rating and financial net worth
comparable to or better than that of Ciena Corporation, and a commercial real estate portfolio
which includes properties comparable in value and use to that of the Premises; there will be no
requirement to provide for the Landlord Security Account to secure the performance of the New
Landlord’s covenants under this Lease.



          Article 27. Early Termination by Landlord




     Section 27.1 Effective at any time after the end of the thirtieth (30th) month of the Term
(the “Standstill Period”), Landlord will have the right to early terminate the Term of this Lease
at any time on at least thirty (30) months prior written notice (the “Early Termination Notice” and
the “Early Termination Notice Period”) to Tenant in the event that the Carling Campus is sold to a
bona fide arm’s length purchaser who requires vacant possession of the Premises occupied by Tenant
prior to the end of the Term (the “Early Termination Right”).




 




			
	[*]	 	Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission.
Confidential treatment has been requested with respect to the omitted portions.




37









 




For greater clarity, the Landlord’s entitlement to provide the Early Termination Notice shall
be at any time during the Term, provided that it is effective only as and from the end of the
Standstill Period, and the Early Termination Notice Period shall commence on the date Tenant has
received both the Early Termination Notice and the Early Termination Fee. The Early Termination
Right is personal to, and may only be exercised by, Nortel Networks Technology Corporation or any
of its Affiliates during the period of its or their ownership of the Premises.




     Section 27.2 If Landlord exercises the Early Termination Right, it will direct the Escrow
Agent to pay to Tenant from the Carling Property Escrow Amount the Early Termination Fee within
three (3) Business Days of the delivery of the Early Termination Notice.



     Section 27.3 The termination fee payable pursuant to Section 27.2 shall be USD
$33,500,000 (plus applicable taxes and all interest earned thereon, the “Early Termination Fee”).
For the period commencing on the seventy-third (73rd) month of the Term, the Early
Termination Fee shall begin to be reduced on a monthly schedule at a rate of USD$697,916.67, such
monthly reductions to be effective on the expiry of each month such that on the expiry of the Term,
the Early Termination Fee would be $0.


For greater clarity, the table set out in Exhibit “E” hereto sets forth the Early Termination Fee
which would be payable in the event the Lease was terminated at the end of each of the listed
months in accordance with this Article 27.




     Section 27.4 Notwithstanding anything to the contrary herein, the provisions in respect of the
Early Termination Fee and the payment by Landlord thereof to Tenant in this Article 27
shall apply, mutatis mutandis, in respect of any termination of the Lease resulting from an
Incurable Termination Event. For purposes of this Article 27, “Incurable Termination
Event” means any termination of this Lease prior to the expiry of the Term as a result of the
occurrence of any circumstance under any Lien resulting in the subject lien claimant terminating
the Lease or foreclosing Tenant’s leasehold interest under this Lease (including as a result of the
failure to pay Taxes when due) resulting in Tenant being force to vacate the Premises as
applicable, but provided that the such circumstance has not resulted due to the Default of Tenant
under the terms of this Lease.



     Section 27.5 In the event that Landlord provides written notice to Tenant irrevocably waiving
the Early Termination Right and agreeing that Article 27 shall be of no further force or
effect, and provided that at the time of the giving of such notice to Tenant no proceedings are
being prosecuted by a lien claimant in respect of a Lien securing a material obligation which could
result in this Lease being terminated, the Escrow Agent shall be instructed to release the Early
Termination Fee to Landlord.



          Article 28. Miscellaneous




     Section 28.1



          (a) This Lease shall be governed by the laws of the Province of Ontario.




          (b) Tenant shall not record this Lease or any memorandum of this Lease, except Landlord and
Tenant will enter into a mutually agreeable notice of lease.







38









 








          (c) Subject to the provisions of this Lease, this Lease shall bind and inure to the benefit of
Landlord and Tenant and their respective legal representatives, successors and assigns.




          (d) This Lease may not be changed or terminated, in whole or in part, except by agreement in
writing signed by Landlord and Tenant.




          (e) Notwithstanding any provision of this Lease, or any Law, to the contrary, or the execution
of this Lease by Tenant, this Lease shall not bind or benefit Landlord or Tenant, unless and until
this Lease is signed and delivered by Landlord and Tenant.




          (f) Tenant shall hold in confidence and shall not disclose to third parties other than its
officers, directors, partners, members, employees, representatives, brokers, lenders, attorneys,
accountants and advisors, and shall cause its officers, directors, partners, members, employees,
representatives, brokers, lenders, attorneys, accountants and advisers to hold in confidence and
not disclose to third parties, the terms of this Lease, except to the extent any such terms (i)
must be disclosed pursuant to any Law, (ii) are publicly known or become publicly known other than
through the acts of Tenant, or any of its officers, directors, partners, members, employees,
representatives, brokers, lenders, attorneys, accountants or advisers, or (iii) are disclosed by
Tenant in connection with any financing or any proposed financing, any proposed sale of Tenant or
its business, any proposed subletting of the Premises, or any proposed assignment of this Lease.
Notwithstanding the provisions of this paragraph or any other provision of this Lease, each party
to this Lease (and each of its employees, representatives or agents) may disclose to any person,
without limitation of any kind, the tax treatment and tax structure of any transactions
contemplated by this Lease and all materials of any kind (including opinions or other tax analyses)
that are or have been provided to any party to this Lease (or to its employees, representatives or
agents) relating to such tax treatment or tax structure, provided, however, that this authorization
of disclosure shall not apply to restrictions reasonably necessary to comply with securities laws.
This authorization of disclosure is retroactively effective immediately upon commencement of the
first discussions regarding the transactions contemplated by this Lease, and the parties to this
Lease aver and affirm that this tax disclosure authorization has been given on a date which is no
later than thirty (30) days from the first day that any party to this Lease (or its employees,
representatives or agents) first made or provided a statement as to the potential tax consequences
that may result from the transactions contemplated hereby.




          (g) The Exhibits to this Lease, if any, are a part of this Lease, but in the event of an
inconsistency between this Lease and the Exhibits, this Lease shall control.




          (h) Each obligation of Tenant under this Lease is a separate and independent covenant of
Tenant, not dependent on any other provision of this Lease.




          (i) The captions in this Lease are for reference only and do not define the scope of this
Lease or the intent of any term. All Article and Section references in this Lease shall, unless
the context otherwise specifically requires, be deemed references to the Articles and Sections of
this Lease.







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          (j) If any provision of this Lease, or the application thereof to any person or circumstance,
is invalid or unenforceable, then in each such event the remainder of this Lease or the application
of such provision to any other person or any other circumstance (other than those as to which it is
invalid or unenforceable) shall not be affected, and each provision hereof shall remain valid and
enforceable to the fullest extent permitted by Law.




          (k) Tenant and Landlord have been represented by legal counsel and is sophisticated in real
estate leasing and commercial transactions and have had ample opportunity to negotiate the terms of
this Lease as one component of an overall business transaction.




          (l) If there is then no Default subsisting, Tenant may peaceably and quietly enjoy the
Premises without hindrance by Landlord or any person lawfully claiming under Landlord, subject
however, to the terms of this Lease.




          (m) If (i) Tenant is comprised of two or more persons, or (ii) Tenant’s interest in this Lease
is assigned to any person as permitted by this Lease, “Tenant,” as used in this Lease, shall mean
each of those persons, and the liability of those persons under this Lease shall be joint and
several. Wherever appropriate in this Lease, personal pronouns shall be considered to include the
other gender and the singular to include the plural.




          (n) If required in order to comply with the rule against perpetuities, if the Commencement
Date shall not occur within 21 years following the date of this Lease, this Lease shall be deemed
cancelled.




          (o) This Lease is subject to compliance with the provisions of the Planning Act of Ontario, if
applicable.




          (p) Tenant shall have the right to vacate the Premises or leave them unoccupied or unused,
provided Tenant continues to fulfill its monetary and other obligations hereunder.




          (q) This Lease shall be binding upon, extend to and enure to the benefit of Landlord and
Tenant and to each of their respective, successors and permitted assignees.




     Section 28.2 This Lease may be executed in any number of counterparts, each of which will be
deemed to be an original, but all of which together will constitute one instrument. This Lease
shall be considered properly executed by any party if executed, scanned and transmitted by fax or
e-mail to the other parties’ representative or solicitor.



[Signature Page Follows]




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          In Witness Whereof, the parties have executed this Lease on the date of this Lease.




	 	 	 	 	 
	 	Landlord



NORTEL NETWORKS TECHNOLOGY
CORPORATION

 	 
	 	By:  	/s/ Anna Ventresca
 	 
	 	 	Name:  	Anna Ventresca 	 
	 	 	Title:  	Secretary 	 
	 
	 	Tenant



CIENA CANADA, INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 



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          In Witness Whereof, the parties have executed this Lease on the date of this Lease.




	 	 	 	 	 
	 	Landlord



NORTEL NETWORKS TECHNOLOGY
CORPORATION

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	Tenant



CIENA CANADA, INC.

 	 
	 	By:  	/s/ Gary B. Smith
 	 
	 	 	Name:  	Gary B. Smith 	 
	 	 	Title:  	President and Chief Executive Officer 	 
	 




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