halifax_lease.htm


     

    
      Delivered
by Electronic Mail

       

      October
30, 2007

       

      Mr. Brian
Toole

      Principal

      Partners
Global Corporate Real Estate Inc.

      Suite
225

      1801
Hollis Street

      Halifax,
NS B3J 3N4

       

      Dear
Brian:

       

      
        	
                RE:

              	
                Agreement
      to Lease Amendment (the
“Agreement”)

              


      

      
        	
                 
      

              	
                Between
      Crombie Developments Limited (the “Landlord”)
  and

              


      

      
        	
                 
      

              	
                Flagstone
      Management Services (Halifax) Limited (the
  “Tenant”)

              


      

      
        	
                 
      

              	
                7th
      Floor, Cogswell Tower, 2000 Barrington
Street,

              


      

      
        	
                 
      

              	
                Halifax,
      Nova Scotia (“the Property”)

              


      

       

      *SEE
RIDER


      We are
pleased to propose the following for presentation to your client, Flagstone
Management Services (Halifax) Limited for premises at 7th Floor, Cogswell Tower,
2000 Barrington Street, Halifax, Nova Scotia.

       

      1.           PREMISES

       

      The
current premises measured at 10,090 square feet on the 7th floor, shall be
expanded by an additional 4,359 square feet on the 7th floor as shown in green
on Schedule A, hereinafter called the “Expansion Area”, for a total area of
approximately 14,449 rentable square feet, outlined in red.

       

      2.           TERM

       

      Six (6)
years and five (5) months, commencing March 1, 2008 (the “Commencement Date”)
and expiring July 31, 2014.

       

      3.           MINIMUM
RENT

       

      On 14,449
square feet - Effective March 1, 2008 through July 31, 2014, the Minimum Rent
shall be as follows:

       

      
        Twelve
Dollars and Thirty-Five cents per square foot ($12.35) per annum, plus
HST.

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

       

      4.           FIXTURING
PERIOD

       

      On the
Expansion Area only, the Landlord and the Tenant hereby covenant and agree that
the Tenant shall have a Fixturing Period commencing on or before February 1,
2008 and expiring on February 29, 2008.  It is agreed and understood
that the Tenant shall be provided vacant possession of portions of the Expansion
Area as they are vacated by the existing Tenants.  During this period,
the Tenant shall not be responsible for the payment of Minimum and Additional
Rents.  The Tenant shall however be responsible for the payment of
utilities consumed on the Premises during this Fixturing Period and business
taxes.

       

      During
the Fixturing Period, the Tenant shall do all the Tenant’s Work within the
confines of the Demised Premises, shall comply with all rules and regulations
set by the Landlord for the conduct of such work, and shall be subject to all
the terms and conditions of the Lease, including the provisions relating to the
liability of the Tenant for its acts or omissions or the acts or omissions of
its servants, agents or employees, and shall indemnify and save harmless the
Landlord with respect thereto.

       

      5.           LANDLORD’S
WORK

       

      On or
before March 1, 2008, the Landlord, at its own expense, will perform all work in
accordance with Schedule “B” (“Landlord’s Work”) attached hereto (“Landlord’s
Work”).  The Landlord shall carry on the Landlord’s Work in a timely
and workmanlike manner compliance with all applicable by-laws and
regulations.

       

      6.           LEASEHOLD
ALLOWANCE

       

      The
Landlord agrees to pay to the Tenant, a maximum amount equal to ($56,538.50)
Fifty six thousand five hundred and thirty eight dollars and fifty cents
(excluding GST or any other tax imposed including but not limited to any
Harmonized Sales Tax levied under the Excise Tax Act of Canada).  Said
amount to be used by the Tenant to pay for the construction of the leasehold
improvements of the Premises, in accordance with Schedule “B” herein, which when
installed in the Premises become the property of the Landlord and the Tenant
will not use said Leaseholds to secure financing for the Tenant.  The
Landlord has the right to Offset the Leasehold Allowance against arrears on the
Tenant’s account.  Said amount shall be due and payable by the
Landlord to the Tenant during the original Term of the Lease.  The
following must be completed prior to payment being processed:

       

      
        
          
            
              
                
                  
                    
                      
                        
                          	 
      	
                                  (i)

                                	
                                  the
      Tenant has sent the Landlord receipted invoices for work done to the
      Premises;

                                
	 	 	 
	 
      	
                                  (ii)

                                	
                                  the
      Mechanic’s Lien period has ended;

                                
	 	 	 
	 
      	
                                  (iii)

                                	
                                  the
      Tenant has sent an invoice to the Landlord for the Allowance amount and
      GST or any other tax Imposed including but not limited to any Harmonized
      Sales Tax levied under the Excise Tax Act of
  Canada;

                                


                        

                      

                    

                  

                

              

            

          

        

      

       

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

      
         

         

         

        
          
            
              
                
                  
                    
                      
                        
                          
                            	 
      	
                                    (iv)

                                  	
                                    the
      Tenant’s Tax Registration number under the Excise Tax Act of Canada is on
      the invoice;

                                  
	 	 	 
	 
      	
                                    (v)

                                  	
                                    a
      Statutory Declaration is completed by the Tenant to confirm that the
      Tenant’s contractors have been paid;

                                  
	 	 	 
	 
      	
                                    (vi)

                                  	
                                    the
      Lease Amending Agreement is fully executed by both
  parties;

                                  
	 	 	 
	 
      	
                                    (vii)

                                  	
                                    the
      Tenant is not in default under the Lease;

                                  
	 	 	 
	 
      	
                                    (viii)

                                  	
                                    the
      Tenant is open for business to the public from the Expansion
      Area;

                                  
	 	 	 
	 
      	
                                    (ix)

                                  	
                                    the
      Tenant’s account is paid
up-to-date.

                                  


                          

                        

                      

                    

                  

                

              

            

          

        

        
7.           OPTION TO
RENEW

      

       

      The
Landlord shall grant to the Tenant a renewal of Lease for one (1) term of five
(5) years provided all the following conditions are satisfied:

       

      
        
          
            
              
                
                  
                    	 
      	
                            (i)

                          	
                            the
      Tenant’s account is not in arrears;

                          
	 	 	 
	 
      	
                            (ii)

                          	
                            the
      Tenant duly and regularly performs each and every of the covenants,
      provisos and agreements herein contained on the part of the Tenant to be
      paid, done and performed;

                          
	 	 	 
	 
      	
                            (iii)

                          	
                            written
      request of the Tenant to renew the Lease is received by the Landlord not
      less than nine (9) months before the expiration of the Term (the “Expiry
      Date”);

                          
	 	 	 
	 
      	
                            (iv)

                          	
                            covenants,
      provisos, agreements and rents are determined by negotiation, prior to the
      Expiry Date, based on fair market taking into consideration premises in
      equal quality buildings within the Halifax Central Business District of
      similar age and location;

                          
	 	 	 
	 
      	
                            (v)

                          	
                            documentation,
      provided by the Landlord to renew the Lease, is fully executed by the
      Tenant prior to the Expiry Date.

                          
	 	 	 
	 
      	
                            (vi)

                          	
                            Landlord
      shall provide Tenant a fair market rent proposal on or before twelve (12)
      months prior to the expiry of the original
Term.

                          


                  

                

              

            

          

        

      

      


      If for any reason all the above noted
conditions are not satisfied at the Expiry Date, this Renewal Option shall be
deemed null and void.  Any broker services retained by the Tenant for
the purpose of renewing this Lease shall be paid by the Tenant to the complete
exoneration of the Landlord.

       

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

       

       

       

      8.           VACATING THE
PREMISES

       

      Notwithstanding
anything in the Lease to the contrary, the Tenant shall not be in default for
vacating the Premises prior to the expiration date of the term so long as the
Tenant continues to pay its Minimum Rent and Additional Rent as per the Lease
and is not in default on the other provisions of the Lease, and written notice
is provided to the Landlord at least thirty (30) days in advance of vacating the
Premises.  Should the Tenant provide proper notice, has vacated and is
not in default of the Lease Agreement, the Landlord will have the option to
terminate the Lease, upon providing thirty (30) days notice.  At any
time prior to Landlord’s notice of such termination, Tenant shall be entitled to
resume its occupation of the Premises, upon providing ten (10) days
notice.

       

      9.           RESTORATION/MAKE
GOOD

       

      Notwithstanding
anything in the Lease to the contrary, it is agreed that the Tenant shall not
have the obligation to remove existing leasehold improvements or to restore the
Premises to base building or original condition at the termination of the Lease
and the Landlord agrees to accept the Premises in the condition and
configuration in which they are structured at that time normal reasonable wear
and tear considered.  Tenant covenants to maintain the premises in a
first-class condition.  However, the Tenant will have the right to
remove Tenant’s fixtures, telephone switches, security systems, furniture and
equipment so long as any damage caused as a result of such removals is repaired
as required.

       

      10.           RIGHT OF FIRST
OFFER

       

      Deleted
in its entirety.

       

      11.           RELOCATION

       

      The
Landlord and the Tenant hereby covenant and agree that the Landlord, acting
reasonably, shall have the option at any time during the Term of the Lease, and
upon ninety (90) days prior written notice to the Tenant, to relocate the Tenant
to Alternate Premises of similar size and condition as the existing Premises
(the “Alternate Premises”).  All Leasehold Improvements and reasonable
moving costs required to bring Alternate Premises to a similar condition as the
existing Premises shall be done at the sole cost and expense of the
Landlord.  The Landlord covenants to arrange the relocation of the
Tenant’s property and equipment at a time and in such a manner as not to
substantially interfere with the Tenant’s business operations.  If the
Alternate Premises are larger in area, the Tenant shall pay rent based on the
square footage of the Premises as outlined herein. In the event that the
Landlord and the Tenant cannot agree on the size, location or condition of
Alternate Premises, then the Landlord and/or the Tenant shall have the right,
sixty (60) days prior to the date upon which the relocation was to take place,
to advise the other party of its intention to terminate this Lease on the date
originally intended for the relocation.

       

       

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

       

       

      12.           CONSULTANT’S
FEE

       

      The
Landlord hereby agrees to pay Partners Global Corporate Real Estate Inc., in
consideration for the procuring of this Agreement, a Consultant’s Fee comprising
sum of ONE DOLLAR AND SIXTY CENTS ($1.60) per square foot of rentable leased by
the Tenant (14,449 rentable square feet).  The commission shall be
calculated on the gross rentable area of the Premises.  Upon the date
the Tenant and Landlord have executed a binding Lease Amending agreement, said
commission plus applicable tax on such commission is then due and
payable.

       

      13.           PARKING

       

      In
addition to the Tenant’s existing parking rights, throughout the Term of the
Lease and any exercised lease renewal periods, the Landlord shall provide the
Tenant with up to ten (10) additional on-site parking stalls at the then
current monthly rate, subject to annual adjustment, which is currently $130.00
per stall per month, plus H.S.T.  All parking shall be assignable to
any approved assignee or subtenant.

       

      14.           LANDLORD’S
CONDITION

       

      The
obligation of the Landlord to be bound by the terms of this Agreement is subject
to the following condition precedent:

       

      (a) the
Landlord’s negotiation of a Surrender of Lease for the Expansion Area currently
occupied by Stevenson Financial and Atlantic Catch Data; and the Relocation of
Atlantic School of Chartered Accountants, to be confirmed on or before November
16 2007. Landlord’s costs relating to this item 14 (a) shall not exceed $20,000,
plus HST.  All additional costs above this amount shall be at the
Tenant’s sole cost and responsibility.

       

      The above
condition is for the sole benefit of the Landlord.  If the Landlord
fails to notify the Tenant by 5:00 p.m. on the date specified above for
satisfaction of a condition precedent that such condition precedent has been
satisfied or waived, then this Agreement to Lease shall be deemed null and void
and neither party will have any further legal or financial obligation to the
other.

       

      15.           FURTHER
DOCUMENTATION

       

      Upon
unconditional acceptance of this proposal by the Tenant, the Landlord agrees to
provide the Tenant with the Building’s standard form of Lease Amending
agreement, which shall have been completed in accordance with the terms and
conditions contained in this Proposal.

       

      This
proposal is open for consideration until November 15, 2007.

       

      


      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

       

       

       

      ACCEPTANCE

       

      We hereby
agree that the above correctly sets forth the terms of our agreement and
undertake to carry out the provisions thereof.

       

      Dated at
Halifax, NS this 8th day of November, 2007.

       

       

      


      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        	 	 	FLAGSTONE
      MANAGEMENT SERVICES (HALIFAX) LIMITED
	
                                                  /s/

                                              	 
      	Per:	
                                                 

                                              
	
                                                Witness

                                              	 
      	 	 
      
	 
      	 
      	Title 	
                                                Corporate Secretary

                                              
	 
      	 
      	Having
      authority to bind the
Corporation


                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

      


      We hereby
agree that the above correctly sets forth the terms of our agreement and
undertake to carry out the provisions thereof.

       

      Dated at
Stellarton, N.S. this 15th day of November, 2007.

      


      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              	 
      	 
      	CROMBIE
      DEVELOPMENTS LIMITED
	
                                        /s/

                                    	 
      	
                                      Per: 

                                    	
                                       

                                    
	
                                      Witness

                                    	 
      	 	 
      
	 
      	 
      	Title 	
                                      Vice President,
    Leasing 

                                    
	 
      	 
      	Having
      authority to bind the
Corporation


                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

      


      


      
        
          
            
              
                
                  
                    
                      
                        	 
      	 
      	
                                Per: 

                              	
                                 

                              
	 
      	 
      	 	 
      
	 
      	 
      	Title 	
                                Vice President
    Operations 

                              
	 
      	 
      	Having
      authority to bind the
Corporation


                      

                    

                  

                

              

            

          

        

      

      


       

       

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

      
 

      SCHEDULE
“A”

       

      

       

       

       

       

       

       

       

       

       

       

       

       

       

       

       

       

      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      

       

      SCHEDULE
“B”

       

      The
Landlord, at Landlord’s sole cost and expense, to provide finishes to the
Landlord’s Base Building standards and deliver the following on the Expansion
Premises only:

       

      1.           Demolition:

       

      “As-is,
Where is”

       

      2.           Concrete:

       

      “As-is,
Where is”

       

      3.           Doors
and Windows:

       

      Exit
doors as required by code from the demised space.

       

      Windows
are to be double glazed and equipped with roller shade blinds.

       

      Provide
suite signage in accordance with the building standard.

       

      4.           Ceiling:

       

      Suspended
acoustic tile ceiling to be building standard fissured tile.

       

      5.           Mechanical:

       

      Plumbing:  “As-is,
Where-is”

       

      HVAC:

      Provide
interior zoned air conditioning, heating and ventilation systems
thermostatically controlled.

      Provide
ductwork distribution as per Base Building & standard light troffers as
required to meet ASHRAE standards.  Present system is two (2) interior
zones per floor plus perimeter zoning to suit needs.

       

      Provide
fresh air levels to meet ASHREA 62 (Latest edition standard) subject to the
Landlord approving the Tenant’s detailed drawings.

       

      Fire
Protection:

      Deleted
in its entirety.

       

      6.           Electrical:

       

      The floor
is sized at 400 amp/120/208/floor.  In general the floor shall be
120/208 volt 3 phase 4 wire.

       

      120/208
volt, 3 phase, 4 wire distribution panels shall be provided for supply of
120/208 volt circuit for mechanical equipment, heating and
lighting.

       

      
      

       

      
        	 	
                 Initials
      Landlord ____

              
	 	
                 Tenant
      ____

              


      

       

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

       

      Tenant
currently has 2 panels in their space not including the emergency distribution
in their computer room.  Mechanical equipment power is generally 600
volt feed from “E” level or the penthouse.

       

      7.           Lighting:

       

      Lighting
at desk top level (30” above finished floor) in office areas and at floor levels
in all other areas shall be within the following levels of
illumination:

       

      1.           Office
Area Average 25 – 30 fc interior areas.  Average 40 – 50 fc in areas
closer to windows.  70-80 fc at work station closest to windows, new
section south of computer room approximately 40-50 ft.

       

      2.           Entrance,
storage rooms - Ground level entrance 50 fc.  “S” level storage common
area 25-30- fc

       

      3.           Hallways,
corridors, washrooms, etc. - recent renovated lobby / hallway 10-15 fc. Readings
from the 6th floor.

       

      4.           Parking
Entrances - Average 10fc.

       

      5.           Parking
traffic lanes, parking spaces - Average 10fc - 15fc

       

      Light
fixtures are 1x5 recessed fluorescent troffers.

       

      8.           Lobby:

       

      During
the calendar year of 2008, the Landlord shall upgrade the existing Lobby on the
7th floor to include new carpeting, lighting and paint/wallpaper based on
standards to be mutually agreed.

       

      
         

        
          	 	
                   Initials
      Landlord ____

                
	 	
                   Tenant
      ____

                


        

         

      

       

       

      9

      
        

      

       

      RIDER

       

      Flagstone -
Crombie

      Letter dated
October 30, 2007

      
 

      
        	
                RE:

              	
                Lease
      agreement dated July 26, 2005 between Crombie Developments Limited, as
      Landlord, and West End Capital Services (Halifax) Limited, as Tenant (the
      “Original Lease”), whereby the Tenant changed its name to Flagstone
      Management Services (Halifax) Limited, which Original Lease was amended by
      Amending Agreements dated August 16, 2005, March 20, 2006, May 1, 2006,
      October 18, 2006, November 20, 2006, January 24, 2007, May 18, 2007
      and May 19, 2007 (the “Amendments”), and collectively the Original
      Lease and Amendments are herein referred to as the
  “Lease”.