Document:

exv10w23

 

Exhibit 10.23

Execution Version

Royal Wolf Intercreditor Deed

Parties

Australia and New Zealand Banking Group Limited

ACN 005 357 522

General Finance Corporation

GFN U.S. Australasia Holdings, Inc.

Bison Capital Australia, L.P.

Royal Wolf Trading Australia Pty Ltd

ACN 069 244 417

GFN Australasia Finance Pty Ltd

ACN 121 227 790

RWA Holdings Pty Ltd

ACN 106 913 964

GFN Australasia Holdings Pty Ltd

ACN 121 226 793

Royal Wolf Hi-Tech Pty Ltd

ACN 079 735 050

Contact

Geoff Sutherland

Special Counsel

1 Alfred Street, Circular Quay, Sydney NSW 2000

Telephone:       +61 (0)2 9330 8320

Email:                geoff.sutherland@deacons.com.au

Website:           www.deacons.com.au

Our ref:             2591385

 

 

	 	 	 
	Deed dated
	 	September 13, 2007
	 
	 	 
	Parties
	 	Australia and New Zealand Banking Group Limited ACN 005 537 522
	 
	 	of Level 12, 20 Martin Place, Sydney NSW 2000, Australia

	 
	 	(Financier)
	 
	 	 
	 
	 	General Finance Corporation
	 
	 	of 260 S. Los Robles, Suite 217, Pasadena CA 91101, United States of America
	 
	 	(GFN)
	 
	 	 
	 
	 	GFN U.S. Australasia Holdings, Inc.
	 
	 	of 260 S. Los Robles, Suite 217, Pasadena CA 91101, United States of America

	 
	 	(GFN U.S.)
	 
	 	 
	 
	 	Bison Capital Australia, L.P.
	 
	 	of 10877 Wilshire Boulevard, Suite 1520, Los Angeles, CA 90024, United States of America
	 
	 	(Bison)
	 
	 	 
	 
	 	Royal Wolf Trading Australia Pty Ltd ACN 069 244 417
	 
	 	of 57 Grosvenor Street, Neutral Bay NSW 2089, Australia
	 
	 	(RWTA)
	 
	 	 
	 
	 	GFN Australasia Finance Pty Ltd ACN 121 227 790
	 
	 	of C/- Robert Barnes Solicitors, Level 2, 222 Clarence Street, Sydney NSW 2000,
	 
	 	Australia
	 
	 	(GFNAF)
	 
	 	 
	 
	 	RWA Holdings Pty Ltd ACN 106 913 964
	 
	 	of Suite 201, Level 2, 22-28 Edgeworth David Avenue, Hornsby NSW 2077, Australia
	 
	 	(RWAH)
	 
	 	 
	 
	 	GFN Australasia Holdings Pty Ltd ACN 121 226 793
	 
	 	of Level 2, 222 Clarence Street, Sydney NSW 2000, Australia
	 
	 	(GFNAH)
	 
	 	 
	 
	 	Royal Wolf Hi-Tech Pty Ltd ACN 079 735 050
	 
	 	of Level 2, 22-28 Edgeworth David Avenue, Hornsby NSW 2077, Australia
	 
	 	(RWHT)

Deed of Subordination       1

 

 

Introduction

	A.	 	Under the Facilities the Financier may provide accommodation to RWTA.
	 
	B.	 	The obligations of RWTA to the Financier under the Facilities are, or have agreed to be
guaranteed by GFNAF, RWAH, GFNAH and RWHT pursuant to the Guarantee and are secured by the
Senior Securities.
	 
	C.	 	The Financier has agreed to provide accommodation under the Facilities to RWTA on the
condition that Bison and the other parties enter into this deed.

It is agreed

	1.	 	Definitions and interpretation
	 
	1.1	 	Definitions
	 
	 	 	In this Agreement:

	 	(1)	 	Bison Debt means all money which GFNAF is or at any time becomes actually or
contingently liable to pay to or for the account of Bison including under the Bison
Note (and includes, without limitation, money payable in respect of interest, default
interest, fees, penalties, costs, charges, expenses, damages (liquidated and
unliquidated) or under any indemnity).
	 
	 	(2)	 	Bison Guarantee means the guarantee and indemnity granted in favour of Bison
by RWAH, RWTA, GFNAH and RWHT.
	 
	 	(3)	 	Bison Note means the A$20million Secured Senior Subordinated Promissory Note
issued or to be issued by GFNAF to Bison issued on or about the date of this deed in
accordance with the Securities Purchase Agreement.
	 
	 	(4)	 	Bison’s Securities means:

	 	(a)	 	Fixed and floating charge granted by GFNAH in favour of
Bison over all its assets and undertaking;
	 
	 	(b)	 	Fixed and floating charge granted by GFNAF in favour of
Bison over all its assets and undertaking;
	 
	 	(c)	 	Fixed and floating charge granted by RWAH in favour of
Bison over all its assets and undertaking;

Deed of Subordination       2

 

 

	 	(d)	 	Fixed and floating charge granted by RWTA in favour of
Bison over all its assets and undertaking;
	 
	 	(e)	 	Fixed and floating charge granted by RWHT in favour of
Bison over all its assets and undertaking;
	 
	 	(f)	 	Bison Guarantee;

	 	(5)	 	Bison Subordination Period means the period from the date of this deed until
the date that Bison is satisfied that:

	 	(a)	 	the Bison Debt has been irrevocably paid in full; and
	 
	 	(b)	 	no amounts remain contingently payable or may become
payable under the Bison Note, the Bison Guarantee or the Bison Securities
(including under an indemnity); and
	 
	 	(c)	 	Bison has cancelled every commitment to provide financial
accommodation to the RW Group.

	 	(6)	 	Bison’s Transaction Documents means:

	 	(a)	 	the Bison Note; and
	 
	 	(b)	 	the Bison’s Securities;

	 	(7)	 	Encumbrance means any:

	 	(a)	 	security for the payment of money or performance of
obligations, including a mortgage, charge, lien, pledge, trust, power or
title retention or flawed deposit arrangement; or
	 
	 	(b)	 	right, interest or arrangement which has the effect of
giving another person a preference, priority or advantage over creditors
including any right of set-off; or
	 
	 	(c)	 	right that a person (other than the owner) has to remove
something from land (known as a profit à prendre), easement, public right of
way, restrictive or positive covenant, lease, or licence to use or occupy; or
	 
	 	(d)	 	third party right or interest or any right arising as a
consequence of the enforcement of a judgment,

	 		 	or any agreement to create any of them or allow them to exist.
	 
	 	(8)	 	Event of Default has the same defined meaning as in the document entitled
“ANZ General Conditions — Fourth Edition 2003” as amended by the Letter of Offer.

Deed of Subordination       3

 

 

	 	(9)	 	Facilities means the facilities provided or to be provided by the Financier
to RWTA pursuant to the Letter of Offer.
	 
	 	(10)	 	Financial Indebtedness means an obligation (whether present, future, actual
or contingent) to pay or deliver any money or commodity under or in respect of any
financial accommodation including under, in respect of or in connection with:

	 	(a)	 	any money borrowed or raised;
	 
	 	(b)	 	redeemable or repurchaseable share or stock provided,
however, that any default or delay payments made by GFN to Bison or its
affiliates in respect of the failure by GFN to register shares of GFN’s
capital stock held by Bison or its affiliates pursuant to the Registration
Rights Agreement dated as of even date herewith, by and between Bison and GFN
shall not constitute “Financial Indebtedness”;
	 
	 	(c)	 	bill of exchange, promissory note or other financial
instrument (whether transferable or not);
	 
	 	(d)	 	buy back or discounting arrangement in respect of any
property;
	 
	 	(e)	 	lease, license or other arrangement in respect of property
entered into predominantly for the raising of finance or to finance the
purchase of that property;
	 
	 	(f)	 	interest or currency swap or hedge arrangement, financial
option, futures contract or other analogous transaction; or
	 
	 	(g)	 	any arrangement or transaction which is analogous to or has
the same commercial outcome as any of the above.

	 	(11)	 	Financier’s Transaction Documents means:

	 	(a)	 	the Letter of Offer; and
	 
	 	(b)	 	the Senior Securities

	 	(12)	 	Guarantee means document entitled ‘Corporate Guarantee and Indemnity’ in
favour of the Financier granted or to be granted by RWAH, GFNAF, GFNAH and RWHT as
sureties on account of RWTA dated on or about the date of this deed.
	 
	 	(13)	 	GFN Debt means all obligations for which GFNAH or any of its direct or
indirect subsidiaries is or at any time becomes actually or contingently liable to GFN
or any of its direct or indirect subsidiaries (and includes, without limitation,
money payable in

Deed of Subordination       4

 

 

	 	 	 	respect of interest, fees, costs, charges, expenses, damages (liquidated and
unliquidated) or under any indemnity).

	 	(14)	 	GFN Group means GFN and GFN U.S.
	 
	 	(15)	 	Letter of Offer means the letter of offer from the Financier to RW Group
dated on or about 15 September 2007.
	 
	 	(16)	 	Permitted Management Fees means fees for the provision of management services
provided by the GFN Group to RW Group for which the Financier has granted prior
consent in writing;
	 
	 	(17)	 	RW Group means RWTA, RWAH, RWHT, GFNAF and GFNAH
	 
	 	(18)	 	Secured Party or Secured Parties means the Financier and Bison.
	 
	 	(19)	 	Secured Party’s Debt means the Senior Debt and the Bison Debt.
	 
	 	(20)	 	Secured Property means any mortgaged property under the Security;
	 
	 	(21)	 	Securities Purchase Agreement means the Securities Purchase Agreement by and
among some of the parties hereto and GFN U.S. Australasia Holdings, L.P.
	 
	 	(22)	 	Security means any of the Senior Securities, the Bison Securities and any
security provided by a Security Provider to a Secured Party after the date of this
deed.
	 
	 	(23)	 	Security Interest includes any mortgage, pledge, hypothecation, lien or
charge or anything analogous to any of the foregoing or any security interest or
arrangement of any kind (including without limitation, retention of title) of a
creditor to have its claims satisfied prior to other creditors or from the proceeds of
any asset.
	 
	 	(24)	 	Security Provider means GFNAH, GFNAF, RWAH, RWTA and RWHT
	 
	 	(25)	 	Senior Debt means all money which the RW Group is or at any time become
actually or contingently liable to pay to or for the account of the Financier on any
account whatsoever including, without limitation, under the Facilities, the Guarantee
or the Securities.
	 
	 	(26)	 	Senior Secured Party means:

	 	(a)	 	until the end of the Senior Subordination Period, the
Financier; and

Deed of Subordination       5

 

 

	 	(b)	 	thereafter Bison.

	 	(27)	 	Senior Securities means the:

	 	(a)	 	Fixed and floating charge dated 20 May 2005 granted by RWTA
in favour of the Financier over all its assets and undertaking;
	 
	 	(b)	 	Fixed and floating charge dated 20 May 2005 granted by RWAH
in favour of the Financier over all its assets and undertaking;
	 
	 	(c)	 	Fixed and floating charge dated on or about the date of
this deed granted by GFNAH in favour of the Financier over all its assets and
undertaking;
	 
	 	(d)	 	Fixed and floating charge dated on or about the date of
this deed granted by GFNAF in favour of the Financier over all its assets and
undertaking;
	 
	 	(e)	 	Fixed and floating charge dated 29 March 2007granted by
RWHT in favour of the Financier over all its assets and undertaking;

	 	(28)	 	Senior Subordination Period means the period from the date of this deed until
the date that the Financier is satisfied that:

	 	(a)	 	the Senior Debt has been irrevocably paid in full; and
	 
	 	(b)	 	no amounts remain contingently payable or may become
payable under the Facilities, the Guarantee or the Securities ( including
under an indemnity); and
	 
	 	(c)	 	the financier has cancelled every commitment to provide
financial accommodation to the RW Group.

	 	(29)	 	Subordination Period means:

	 	(a)	 	the Senior Subordination Period; and
	 
	 	(b)	 	thereafter, the Bison Subordination Period.

	1.2	 	Interpretation

	 	(1)	 	Reference to:

	 	(a)	 	one gender includes the others;
	 
	 	(b)	 	the singular includes the plural and the plural includes
the singular;

Deed of Subordination       6

 

 

	 	(c)	 	a person includes a body corporate;
	 
	 	(d)	 	a party includes the party’s executors, administrators,
successors and permitted assigns;
	 
	 	(e)	 	a statute, regulation, code or other law or a provision of
any of them includes:

	 	(i)	 	any amendment or replacement of it; and
	 
	 	(ii)	 	another regulation or other statutory
instrument made under it, or made under it as amended or replaced;
and

	 	(f)	 	dollars means Australian dollars unless otherwise stated.

	 	(2)	 	“Including” and similar expressions are not words of limitation.
	 
	 	(3)	 	Where a word or expression is given a particular meaning, other parts of
speech and grammatical forms of that word or expression have a corresponding meaning.
	 
	 	(4)	 	Headings and any table of contents or index are for convenience only and do
not form part of this Agreement or affect its interpretation.
	 
	 	(5)	 	A provision of this Agreement must not be construed to the disadvantage of a
party merely because that party was responsible for the preparation of the Agreement
or the inclusion of the provision in the Agreement.
	 
	 	(6)	 	If an act must be done on a specified day which is not a Business Day, it
must be done instead on the next Business Day.

	1.3	 	Parties

	 	(1)	 	If a party consists of more than 1 person, this Agreement binds each of them
separately and any 2 or more of them jointly.
	 
	 	(2)	 	An obligation, representation or warranty in favour of more than 1 person is
for the benefit of them separately and jointly.
	 
	 	(3)	 	A party which is a trustee is bound both personally and in its capacity as a
trustee.

	2.	 	Subordination
	 
	2.1	 	Subordination

Deed of Subordination       7

 

 

	 	(1)	 	The Bison Debt is subordinated to the Senior Debt with the effect that the
Bison Debt is not payable and is not to be repaid during the Senior Subordination
Period.
	 
	 	(2)	 	The GFN Debt is subordinated to the Senior Debt and the Bison Debt with the
effect that GFN Debt is not repayable and is not to be repaid during the Subordination
Period.

	2.2	 	Matters not affecting subordination
	 
	 	 	The subordination effected by this deed applies in accordance with the terms of this deed
despite:

	 	(1)	 	any Security Interest which the Financier may at any time hold as security
for payment of any Senior Debt or any Security Interest which Bison may at any time
hold as security for payment of any Bison Debt;
	 
	 	(2)	 	any action or inaction on the part of the Financier with respect to the
Senior Debt or any action or inaction on the part of Bison with respect to the Bison
Debt including, without limitation, any variation of the terms of the Senior Debt or
the Bison Debt (as case may be), any extension of the time for payment of it or any
comprise, waiver, election, discharge or release in respect of it; and
	 
	 	(3)	 	the occurrence of any event, or any other thing, which might otherwise limit
or affect the subordination.

	3.	 	Satisfaction of Subordinated Indebtedness
	 
	3.1	 	Terms of subordination of the Bison Debt
	 
	 	 	Bison, GFN and the RW Group agree with the Financier that, subject to the terms of this
deed but despite any other agreement between Bison and RWTA, unless and until:

	 	(1)	 	the expiry of the Senior Subordination Period; or
	 
	 	(2)	 	an order or resolution for the liquidation, receivership, reorganisation,
composition or administration of RWTA is made or occurs

	 	 	the following shall apply:

	 	(a)	 	no part of the Bison Debt shall be due or owing or capable
of being declared due or owing;
	 
	 	(b)	 	the RW Group will not pay the whole or any part of the
Bison Debt (other than as permitted under clause 3.5) or

Deed of Subordination       8

 

 

	 		 	otherwise permit Bison to recover it, and Bison will not demand or
commence proceedings for the repayment or recovery of any part of the
Bison Debt;

	 	(c)	 	Bison will not exercise any right of set-off against the RW
Group or merge or combine any accounts of the RW Groups as to recover any of
the Bison Debt t; and
	 
	 	(d)	 	Bison will not accelerate the repayment of the Bison Debt,

	 	 	but upon the occurrence of an event referred to in Clause 3.1(2) the Bison Debt shall
become immediately due and owing.

	3.2	 	Terms of Subordination of the GFN Debt

	 	 	The GFN Group and the RW Group agree with the Financier and Bison that, subject to the
terms of this deed but despite any other agreement between the Financier or Bison, on the
one hand, or the GFN Group or any of its direct and indirect subsidiaries (including the RW
Group), on the other hand, unless and until:

	 	(1)	 	the expiry of the Subordination Period; or
	 
	 	(2)	 	an order or resolution for the liquidation, receivership, reorganisation,
composition or administration of RWTA is made or occurs

	 	 	the following shall apply:

	 	(a)	 	no part of the GFN Debt shall be due or owing or capable of
being declared due or owing;
	 
	 	(b)	 	the RW Group will not pay the whole or any part of the GFN
Debt (other than as permitted under Clause 3.5) or otherwise permit the GFN
Group to recover it, and the GFN Group will not demand or commence
proceedings for the repayment or recovery of any part of the GFN Debt;
	 
	 	(c)	 	the GFN Group will not exercise any right of set-off
against the RW Group or merge or combine any accounts of the RW Group as to
recover any of the GFN Debt; and
	 
	 	(d)	 	the GFN Group will not accelerate the repayment of the GFN
Debt,

Deed of Subordination       9

 

 

	 	 	but upon the occurrence of an event referred to in Clause 3.1(2) the GFN Debt shall become
immediately due and owing.
	 
	3.3	 	Undertaking and consent by Bison and GFN

	 	(1)	 	Bison and the GFN Group undertake to the Financier that, following the
occurrence of an event referred to in Clause 3.1(2):

	 	(a)	 	upon request by the Financier, Bison and the GFN Group will
immediately prove their claims in relation to the RW Group to the full amount
of the Bison Debt and GFN Debt and will promptly send a copy of any notice of
proof to the Financier; and
	 
	 	(b)	 	Bison and the GFN Group will not prove any claim in
relation to the RW Group except at the request of the Financier.

	 	(2)	 	The RW Group acknowledges and consent to the matters referred to in paragraph
(1).

	3.4	 	Undertaking and consent by GFN

	 	(1)	 	The GFN Group undertakes to the Financier and Bison that, following the
occurrence of an event referred to in Clause 3.1(2):

	 	(a)	 	upon request by a Secured Party, the GFN Group will
immediately prove its claims in relation to the RW Group to the full amount
of the GFN Debt and will promptly send a copy of any notice of proof to the
Secured Parties; and
	 
	 	(b)	 	the GFN Group will not prove any claim in relation to the
RW Group except at the request of a Secured Party.

	 	(2)	 	The RW Group acknowledges and consent to the matters referred to in paragraph
(1).

	3.5	 	Permitted payment

	 	(1)	 	GFNAF may pay and Bison may receive interest that becomes due and payable to
Bison in respect of Bison Debt (including interest that may have been postponed due to
the subordination provisions hereof) and Permitted Management Fees provided that at
the time of making such payment:

	 	(a)	 	no Event of Default has occurred which remains unremedied
or unwaived; and
	 
	 	(b)	 	no Event of Default would occur as a result of making that
payment.

Deed of Subordination       10

 

 

	 	(2)	 	GFNAF may pay and the GFN Group may receive Permitted Management Fees that
become due and payable to the GFN Group if:

	 	(a)	 	no Event of Default has occurred which has become remedied
or waived; and
	 
	 	(b)	 	no further Event of Default would occur as a result of
making that payment.

	 	(3)	 	The RW Group may not pay any interest or make any principal repayments in
relation to the GFN Debt to the GFN Group.
	 
	 	(4)	 	Nothing in this deed will prevent RWAH paying dividends to GFNAF, to enable
GFNAF to make interest payments to Bison, that are permitted to be made under this
deed.

	4.	 	Priority of Securities
	 
	4.1	 	Priority of Senior Securities, Bison’s Securities and the GFN Securities

	 	(1)	 	The Secured Parties agree that the Senior Securities have priority over the
Bison’s Securities and the GFN Securities for the payment of the Senior Debt secured
at any time under the Senior Securities.
	 
	 	(2)	 	Bison and the GFN Group agree that the Bison’s Securities have priority over
the GFN Securities.

	4.2	 	Further Securities
	 
	 	 	This deed, including in particular the order of priorities set out in Clause 4.1 shall
apply to any other Security Interest in any Security now or in the future held by a Secured
Party to the extent that such Security Interest affects any property which is subject to a
Security held by the other Secured Party.
	 
	4.3	 	Cross-default
	 
	 	 	Notwithstanding anything contained in the Senior Securities or Bison’s Securities:

	(1)	 	if the moneys secured by a Security become immediately due and payable, the
moneys secured by each other Security shall, at the option of the Secured Party
holding such other Security, become immediately due and payable; and

Deed of Subordination       11

 

 

	 	(2)	 	if a Security, having operated as a floating charge in respect any
asset, crystallises and operates as a fixed charge in respect of that asset, the
other Securities, if they operate as a floating charge over that asset, shall
automatically and immediately crystallise and operate as a fixed charge in respect of
that asset.

	5.	 	Consents and limitation of liability
	 
	5.1	 	Consent of each party
	 
	 	 	Each party consents to, and acknowledges, the order of priorities set out in this deed.
	 
	5.2	 	No action against a Security Provider

	 	(1)	 	While any amounts are outstanding under the Senior Securities, if Bison has
money owing to it in connection with Bison’s Securities, or if the GFN Group has money
owing to it in connection with the GFN Securities, neither Bison nor the GFN Group may
seek to recover that money by appointing a receiver, applying to have a receiver or
an administrator appointed by any court or taking any proceedings for the appointment
of a receiver by a court to any of the assets of the Security Providers or taking any
proceedings for the appointment of an administrator to the Security Providers.
	 
	 	(2)	 	While any amounts are outstanding under the Bison’s Securities, if the GFN
Group has money owing to it in connection with GFN Securities, the GFN Group may not
seek to recover that money by appointing a receiver, applying to have a receiver or an
administrator appointed by any court or taking any proceedings for the appointment of
a receiver by a court to any of the assets of the Security Providers or taking any
proceedings for the appointment of an administrator to the Security Providers.

	5.3	 	Preservation of other rights
	 
	 	 	Nothing in this deed:

	 	(3)	 	releases any Security Provider from its obligations under the Securities; or
	 
	 	(4)	 	affects a Security Provider’s liability or the Secured Parties’ rights
(including the right to sue for any money a Security Provider owes under the
Securities) or the Secured Party’s remedies, including without limitation, any rights
or remedies arising:

Deed of Subordination     12

 

	 	(a)	 	if a representation or warranty made by or on behalf of a
Security Provider in connection with the Securities is found to be incorrect
or misleading in relation to:

	 	(i)	 	the existence, enforceability or priority
of a Security or an Encumbrance which a Security purports to create;
or
	 
	 	(ii)	 	the title to any asset which is subject
to a Security (including the ownership of the relevant asset or the
existence or non-existence of Encumbrances affecting the asset or
its use); or
	 
	 	(iii)	 	the state of repair, or any matter or
thing affecting the use or enjoyment of any asset which is the
subject of a Security; or

	 	(b)	 	under an undertaking in connection with the Securities is
breached; or

	 	(5)	 	prevents the Secured Parties from obtaining equitable relief in connection
with the Securities other than an order requiring payment of money owed by a Security
Provider in a manner other than as contemplated by this clause.

	6.	 	Benefit of Priorities
	 
	 	 	The priorities set out in this deed are not affected by any act or omission by a Secured
Party or any other person. For example, these priorities are not affected by:

	 	(1)	 	any act or omission:

	 	(a)	 	by which a Secured Party’s Debt is not yet payable; or
	 
	 	(b)	 	varying or releasing an Encumbrance (including a Security)
or monetary obligation; or
	 
	 	(c)	 	involving a payment which may be received, or a credit
which may be allowed, by a Secured Party from a Security Provider or any
other person in respect of a Secured Party’s Debt; or
	 
	 	(d)	 	involving a fluctuation in the amount secured by a Security
from time to time; or
	 
	 	(e)	 	involving a notice received by a Secured Party under a
Security; or

Deed of Subordination     13

 

 

	 	(f)	 	involving a notice received by a Secured Party of an
Encumbrance; or
	 
	 	(g)	 	involving the order of execution or registration of a
Security or anything in a Security; or
	 
	 	(h)	 	involving the order in which financial accommodation is
provided or liabilities (whether actual or contingent) are incurred; or
	 
	 	(i)	 	involving any failure to enforce an Encumbrance (including
a Security), chose in action or judgment.

	7.	 	Continuation of Rights and Remedies
	 
	 	 	Except to the extent this deed expressly states otherwise, this deed does not affect:

	 	(1)	 	the rights and remedies of a Secured Party in connection with the assets and
undertaking of the Secured Provider; or
	 
	 	(2)	 	the Security Provider’s obligations in connection with a Secured Party’s Debt
or any Security.

	8.	 	Assignment and Transfer of Security
	 
	 	 	None of the Secured Parties may assign or otherwise deal with a Security unless:

	 	(1)	 	the assignment or dealing occurs in connection with the enforcement of a
Security; or
	 
	 	(2)	 	the person obtaining an interest in that Security has entered into a deed
with the Security Provider and the Financier or Bison (as the case may be) in which
it agrees to be bound by those provisions of this deed which relate to the Financier
or Bison (as the case may be) who is dealing with that Security, and has delivered
the deed to the Financier or Bison (as the case may be); and

	 	(i)	 	in the case of the Financier only, the
assignment is required for the purposes of, or otherwise permitted
under, the Financier’s Transaction Documents; or
	 
	 	(ii)	 	In the case of Bison only, where the
assignment is required for the purposes pf, or otherwise permitted
under, the Securities Purchase Agreement.

Deed of Subordination     14

 

 

	9.	 	Rights and obligations of the Secured Parties
	 
	9.1	 	Notice of default and enforcement
	 
	 	 	A Secured Party will notify the other Secured Party before it takes any action to enforce
a Security (including appointment of a Receiver). (However, if a Secured Party reasonably
considers that any delay in taking the action would adversely affect the value of either
of the Senior Securities or Bison Securities (as the case may be) that Secured Party
agrees to notify the other of the action taken as soon as reasonably practicable after
taking the action). Failure to comply with this Clause will not affect the validity of
any action to enforce a Security.
	 
	9.3	 	Distributions
	 
	 	 	The Secured Parties agree to co-operate with each other in the distribution of the
proceeds of:

	 	(1)	 	enforcement of each Security; or
	 
	 	(2)	 	the sale of, or dealing with the assets of the Security Providers,

	 	 	to ensure the distribution is in accordance with the priorities set out in this deed.
	 
	9.4	 	Marshalling
	 
	 	 	The Secured Parties need not resort to any Encumbrance held for the payment of amounts
secured under a Security before it resorts to any other Encumbrance it holds for the
payment of the same amounts.
	 
	9.5	 	Excess receipts — contingencies
	 
	 	 	If a Secured Party receives an amount as part of its entitlement under this deed on
account of an amount which may become due for payment by that Secured Party to a third
party and the rights of the third party to claim on the Secured Party ends without a claim
for the full amount received having been made, then:

	 	(1)	 	if the other Secured Party has priority for payment under this deed, the
Secured Party agrees to pay to the other an amount equal to that amount (or such
lesser amount as is required if the Secured Party’s priority is for an amount less
than the amount which the Secured Party would otherwise be obliged to pay to the
other); or
	 
	 	(2)	 	if the Secured Party has priority for payment under this deed, it agrees to
apply in or towards payment of the amount for which it has priority under this deed,
an amount equal to that amount (or such lesser amount as is required if the Secured
Party’s priority is

Deed of Subordination     15

 

 

for an amount less than the amount which the Secured Party would otherwise be
obliged to apply).

	9.6	 	Release of Securities
	 
	 	 	If on the disposal of, or other dealing with, the Secured Property by the Financier or a
controller appointed over that Secured Property, whether or not on enforcement of a
Security, the proceeds are insufficient to pay to Bison the amounts secured by the Bison
Securities then Bison agrees to give to the Financier:

	 	(1)	 	a discharge of the Bison Securities; and
	 
	 	(2)	 	any other document required by the Financier to enable the Financier to
provide clear title to the Secured Property to a purchaser.

	 	 	Bison need not release any personal obligation of a Security Provider or any other person.
	 
	10.	 	Security Provider’s agreement and co-operation
	 
	 	 	Each Security Provider agrees:

	 	(1)	 	to co-operate in the implementation of this deed; and
	 
	 	(2)	 	that if a Secured Party makes a payment to the other in accordance with this
deed on the disposal of, or other dealing with, the Secured Property (whether or not
on enforcement of a Security), then the Secured Party will be taken to have received
the payment from the relevant Security Provider.

	11.	 	Recovered moneys to be held on trust
	 
	11.1	 	Bison Recovery
	 
	 	 	If Bison receives or recovers any amount in respect of Bison’s Securities in contravention
of the priorities set forth in Clause 4 of this deed (whether in the liquidation,
provisional liquidation, reorganisation, composition or administration of the RW Group or
otherwise) whilst any part of the Senior Debt remains unsatisfied, then Bison must:

	 	(1)	 	immediately pay the whole of that amount to the Financier; and
	 
	 	(2)	 	(without limiting paragraph (a)) hold that amount on trust for the Financier
pending payment to the Financier.

Nothing in this Clause shall limit Bison’s rights or remedies (including the right to sue
for any money a Security Provider owes under the Securities)

Deed of Subordination     16

 

 

	 	 	under the Bison Note, the Bison Guarantee or Bison’s Securities or to receive and apply any
payments of principal, interest, penalties or fees in respect of the Bison Debt.
	 
	11.2	 	GFN Recovery
	 
	 	 	If the GFN Group receives or recovers any amount in violation of this
deed (whether in the liquidation, provisional liquidation,
reorganisation, composition or administration of the RW Group or
otherwise) whilst any part of the Senior Debt or the Bison Debt
remains unsatisfied, then the GFN Group must:

	 	(1)	 	immediately pay the whole of that amount to the Senior Secured Party; and
	 
	 	(2)	 	(without limiting paragraph (1)) hold that amount on trust for the Senior
Secured Party pending payment to the Senior Secured Party.

	12.	 	Warranties and representations
	 
	12.1	 	Bison Warranties and representations
	 
	 	 	Bison each represents and warrants as to itself only in favour of the Financier that:

	 	(1)	 	Bison does not hold any guarantee or Security Interest in respect of any
Bison Debt other than the Bison Securities;
	 
	 	(2)	 	Bison is the sole legal and beneficial holder of the Bison Debt and it holds
the Bison Debt free of Security Interests;
	 
	 	(3)	 	The Bison Debt is not itself subordinated to any other debt of the RW Group
and no other debt of the RW Group is subordinated to the Bison Debt; and

	12.2	 	GFN Warranties and representations
	 
	 	 	The GFN Group and the RW Group each represent and warrant in favour of the Financier and
Bison that:

	 	(1)	 	the GFN Group does not hold any guarantee or Security Interest in respect of
any GFN Debt;
	 
	 	(2)	 	the GFN Group is the sole legal and beneficial holder of the GFN Debt and it
holds the GFN Debt free of Security Interests;

Deed of Subordination     17

 

 

	 	(3)	 	The GFN Debt is not itself subordinated to any other debt of the RW Group and
no other debt of the RW Group is subordinated to the GFN Debt.

	12.3	 	General
	 
	 	 	Bison, the GFN Group, GFNAH and GFNAF acknowledge and agree that the Financier will provide
accommodation to RWTA under the Facilities in reliance on, amongst other things, the
representations and warranties in Clause 12.1 and 12.2 and the GFN Group, GFNAH and GFNAF
acknowledge that Bison will provide financial accommodation to GFNAH under the Bison Note
in reliance on, amongst other things, the representations and warranties in Clause 12.2.
Each representation and warranty is taken to be repeated on each day of the Subordination
Period.
	 
	13.	 	UNDERTAKING
	 
	13.1	 	By Bison
	 
	 	 	Bison must, unless the Financier consents (which consent will not be unreasonably withheld
or delayed):

	 	(1)	 	not make any further advance to the RW Group;
	 
	 	(2)	 	not take or hold any Security Interest over any asset of the RW Group whether
as security for the payment of any part of the Bison Debt or otherwise other than the
Bison Securities and any future Securities to be provided by the RW Group pursuant to
the Securities Purchase Agreement ;
	 
	 	(3)	 	not take the benefit of any guarantee in respect of the Bison Debt other than
the Bison Guarantee and any future guarantee to be provided by GFN or its direct or
indirect subsidiaries pursuant to the Securities Purchase Agreement;
	 
	 	(4)	 	not assign, transfer or dispose of its interest in the Bison Debt other than
in accordance with clause 8 of this deed;
	 
	 	(5)	 	not exercise any voting power that it has as a shareholder in the RW Group to
ensure the RW Group with the intent of defeating the obligations of Bison and the RW
Group under this deed;
	 
	 	(6)	 	promptly advise the Financier of any default by the RW Group in connection
with the Bison Debt; and
	 
	 	(7)	 	promptly give to the Financier copies of all documents in respect of the
Bison Debt and any changes to those document.

Deed of Subordination     18

 

 

	13.2	 	By the GFN Group
	 
	 	 	The GFN Group must, unless the Senior Secured Party consents:

	 	(1)	 	not make any further advance to the RW Group which is secured by any Security
Interest;
	 
	 	(2)	 	not take or hold any Security Interest over any asset of the RW Group whether
as security for the payment of any part of the GFN Debt or otherwise;
	 
	 	(3)	 	not take the benefit of any guarantee in respect of the GFN Debt;
	 
	 	(4)	 	not assign, transfer or dispose of its interest in the GFN Debt;
	 
	 	(5)	 	exercise any voting power it has as a shareholder in the RW Group to ensure
the RW Group complies with its obligations under this document;
	 
	 	(6)	 	promptly advise the Financier and Bison of any default by the RW Group in
connection with the GFN Debt; and
	 
	 	(7)	 	promptly give to then Financier and Bison copies of all documents in respect
of the GFN Debt and any changes to those deed.

	13.3	 	By the RW Group
	 
	 	 	The RW Group must, unless the Senior Secured Party consents:

	 	(1)	 	not grant any Security Interest over any of its assets whether as security
for the payment of any part of the GFN Debt or Bison Debt or otherwise other than the
Bison Securities;
	 
	 	(2)	 	not allow any guarantee to be granted in respect of the GFN Debt or Bison
Debt;
	 
	 	(3)	 	not consent to the assignment, transfer or disposal of the GFN Debt or Bison
Debt if requested to provide such consent;
	 
	 	(4)	 	promptly advise the Financier if it has been served with a notice or demand
issued in respect of the GFN Debt or Bison Debt and provide a copy of that notice or
demand to the Financier;
	 
	 	(5)	 	promptly give to the Financier copies of all documents in respect of the GFN
Debt or Bison Debt and any changes to those document; and
	 
	 	(6)	 	not incur any Financial Indebtedness (other than Financial Indebtedness
within the RW Group) without obtaining the Financier’s prior written consent.

Deed of Subordination     19

 

 

	13.4	 	By the Financier
	 
	 	 	Without the consent of Bison, the Financier must not:

	 	(1)	 	alter or amend the provisions of the Letter of Offer which amend clause 10 of
the Financier’s General Conditions (Fourth Edition, 2003); or
	 
	 	(2)	 	consent to or authorise the grant or change of any Security Interest on the
assets of any member of the RW Group other than to the Financier.

	14.	 	EXPENSES, DUTIES AND TAXES
	 
	14.1	 	The RW Group must on demand reimburse the Financier and Bison for all costs and expenses of
and relating to the preparation, execution and completion of, or the enforcement or attempted
enforcement or preservation of any rights under, this deed.
	 
	14.2	 	The RW Group must pay all duties and taxes which may be payable in relation to the execution,
delivery, performance, enforcement or attempted enforcement of this deed or any payment or
receipt or other transaction contemplated by this deed.
	 
	14.3	 	The parties acknowledge and agree that notwithstanding any other provision of this deed, the
RW Group must and is permitted to pay all closing fees and payments as set out in a memorandum
entitled “Funds Flow Memorandum”, which is dated on or about the date of this deed.
	 
	15.	 	TERMINATION AND CONTINUATION OF RIGHTS
	 
	15.1	 	This deed will remain in effect until the expiry of the Subordination Period.
	 
	15.2	 	The subordination applies to the present and future balance of the Senior Debt, the GFN Debt
and the Bison Debt and is not discharged by any payment in respect of those debts, the
settlement of any account or anything else which would otherwise prejudice the subordination
or would reduce or discharge liability of the GFN Group, Bison, or the RW Group under this
deed.
	 
	16.	 	MISCELLANEOUS
	 
	16.1	 	This deed may only be varied or replaced by a written document duly executed by each of the
parties.
	 
	16.2	 	A right in favour of the Financier under this document or the breach of an obligation by
Bison under this document can only be waived by a written

Deed of Subordination     20

 

 

	 	 	instrument signed by the Financier. The breach of an obligation of GFN or Bison under this
document can only be waived by a written instrument signed by the Financier and Bison. No
other act, omission or delay of the Financier or Bison will constitute a waiver.
	 
	16.3	 	This deed is governed by and shall be construed in accordance with the laws of New South
Wales and the parties irrevocably and unconditionally submit to the nonexclusive jurisdiction
of the courts of that State.
	 
	16.4	 	The GFN Group and the Bison must promptly execute all documents and do all things that the
Financier reasonably requires from time to time to more effectively carry out the intention of
this deed.
	 
	16.5	 	The Perpetuity Period for any trust under this deed is 80 years or the Subordinated Period,
whichever is the shorter.
	 
	16.6	 	This deed may be executed in counterpart.
	 
	16.7	 	This deed will prevail if there is any inconsistency between this deed and:

	 	(1)	 	the Financier’s Transaction Documents; or
	 
	 	(2)	 	Bison’s Transaction Documents,

Executed as a deed and delivered on the date shown on the first page.

Signed by Australia and New

Zealand Banking Group Limited by

its attorney in the presence of:

	 	 	 	 	 
	 

	 	 	 	 
	Signature of witness

	 	 	 	 
	 
	 	 	 	 
	 

Name of witness (BLOCK LETTERS)

	 	 	 	 
	 
	 	 	 	 
	 

Address of witness

	 	 	 	 
	 
	 	 	 	 
	 	 

	 	 	 
	Signature of Attorney	 

	 	 	 

IN WITNESS WHEREOF, the parties have caused this Agreement to be executed and delivered by
their duly authorized representatives as of the date first written above.

Deed of Subordination     21

 

 

	 	 	 	 	 	 	 
	 	 	General Finance Corporation
	 

	 	By	 	 	 	 
	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	Bison Capital Australia, L.P.
	 
	 	 	 	 	 	 
	 

	 	By	 	 	 	 
	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	GFN U.S. Australasia Holdings, Inc.
	 
	 	 	 	 	 	 
	 

	 	By	 	 	 	 
	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 
	 

	 	 	 	 	 	 

Deed of Subordination     22

 

 

	 	 	 
	Signed for and on behalf of GFN
Australasia Holdings Pty Ltd ACN 121 226
793 by its attorney Robert Charles
Barnes under power of attorney dated in the presence
of:
	 	 
	 
	 	 
	 

Signature of witness

	 	 
	 
	 	 
	 

Name of witness (BLOCK LETTERS)

	 	 
	 
	 	 
	 

Address of witness

	 	 
	 
	 	 
	Signed for and on behalf of GFN
Australasia Finance Pty Ltd ACN 121 227
790 by its attorney Robert Charles Barnes
under power of attorney dated in the presence of:
	 	 
	 
	 	 
	 

Signature of witness

	 	 
	 
	 	 
	 

Name of witness (BLOCK LETTERS)

	 	 
	 
	 	 
	 

Address of witness

	 	 
	 
	 	 
	Signed for and on behalf of Royal Wolf
Trading Australia Pty Limited ACN 069 244
417 by its attorney Robert Charles Barnes
under power of attorney dated in the presence of:
	 	 
	 
	 	 
	 

Signature of witness

	 	 
	 
	 	 
	 

Name of witness (BLOCK LETTERS)

	 	 
	 
	 	 
	 

Address of witness

	 	 
	 
	 	 
	GFN Australasia Holdings Pty Ltd ACN 121 226 793 by its 

attorney
	 	 
	 
	 	 
	/s/ Robert Charles Barnes 

Robert Charles Barnes

	 	 
	 
	 	 
	GFN Australasia Finance Pty Ltd

ACN 121 227 790 by its attorney
	 	 
	 
	 	 
	/s/ Robert Charles Barnes 

Robert Charles Barnes

	 	 
	 
	 	 
	Royal Wolf Trading Australia 

Pty Limited ACN 069 244 417 by 

its attorney
	 	 
	 
	 	 
	/s/ Robert Charles Barnes 

Robert Charles Barnes

	 	 

Deed of Subordination     23

 

 

	 	 	 
	Signed for and on behalf of RWA Holdings
Pty Limited ACN 106 913 964 by its
attorney Robert Charles Barnes under
power of attorney dated in the presence of:
	 	 
	 
	 	 
	 

Signature of witness

	 	 
	 
	 	 
	 

Name of witness (BLOCK LETTERS)

	 	 
	 
	 	 
	 

Address of witness

	 	 
	 
	 	 
	Signed for and on behalf of Royal Wolf
Hi-Tech Pty Ltd ACN 079 735 050 by its
attorney Robert Charles Barnes under
power of attorney dated in the presence of:
	 	 
	 
	 	 
	 

Signature of witness

	 	 
	 
	 	 
	 

Name of witness (BLOCK LETTERS)

	 	 
	 
	 	 
	 

Address of witness

	 	 
	 
	 	 
	RWA Holdings Pty Limited ACN 

106 913 964 by its attorney
	 	 
	 
	 	 
	/s/ Robert Charles Barnes 

Robert Charles Barnes

	 	 
	 
	 	 
	Royal Wolf Hi-Tech Pty Ltd ACN 

079 735 050 by its attorney
	 	 
	 
	 	 
	/s/ Robert Charles Barnes 

Robert Charles Barnes

	 	 

Deed of Subordination     24exv10w24

 

Exhibit 10.24

SUBLEASE

New South Wales

Real Property Act 1900

PRIVACY NOTE: Section 31B of the Real Property Act 1900 (RP Act) authorises the Registrar General
to collect the Information required by this form for the establishment and maintenance of the Real
Property Act Register. Section 96B RP Act requires that the Register is made available to any
person for search upon payment of a fee, if any.

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	STAMP DUTY	 	Office of State Revenue use only
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	(A)	 	 	 	 	 	HEAD LEASE	 	AC998706A
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	(B)	 	 	 	 	 	TORRENS TITLE	 	Property leased: if appropriate, specify the part or premises

BEING PART LOT 4 IN DEPOSITED PLAN 1030800 IN

Being

Lot 41 in DP1109014
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	(C)	 	 	 	 	 	LODGED BY	 	Delivery Box	 	Name, Address or DX and Telephone	 	CODE
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	IW
	 	LLPN
	 	TIERNAN & ASSOCIATES LAWYERS
	 	SL
	 

	 	 	 	 	 	 	 	 	 	 	 	SUITE 7, 64 CROYDON STREET,
	 	L
	 

	 	 	 	 	 	 	 	 	 	 	 	CRONULLA NSW 2230	 	 
	 

	 	 	 	 	 	 	 	 	 	 	 	Tel: 9527 1899	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	Reference

(optional):
	 	PT:RFH:050065	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	(D)	 	 	 	 	 	SUBLESSOR	 	TYNE CONTAINER SERVICES PTY LIMITED (ACN 056 659 931)
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	The sublessor leases to the sublessee the property referred to above.
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	(E)	 	 	 	 	 	 	 	Encumbrances (if applicable):
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	(F)	 	 	 	 	 	SUBLESSEE	 	ROYAL WOLF TRADING AUSTRALIA PTY LIMITED (ACN 069 244 417)
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	(G)	 	 	 	 	 	 	 	TENANCY:
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	(H)	 	 	1.	 	 	TERM:	 	3 YEARS
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	2.	 	 	COMMENCING DATE:	 	7 FEBRUARY 2007
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	3.	 	 	TERMINATING DATE:	 	6 FEBRUARY 2010
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	4.	 	 	With an OPTION TO RENEW for a period of 2 years set out in clause No. Item 11 of Annexure A
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	5.	 	 	Together with and reserving the RIGHTS set out in ANNEXURE A
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	6.	 	 	Incorporates the provisions or additional material set out in ANNEXURE(S) B hereto.
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	7.	 	 	Incorporates the provisions set out in LEASE registered in the Department of Lands, Land and Property Information Division as
No. AA9175667A
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	8.	 	 	The RENT is set out in item/clause 1 of ANNEXURE A.
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	DATE                                    	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 

Page 1 of 46

 

	(I)	 	Certified correct for the purposes of the Real Property Act 1900 by the
corporation named below the common seal of which was affixed pursuant to the
authority specified and in the presence of the authorised person(s) whose
signature(s) appears(s) below.

	 	 	 
	Corporation

	 	TYNE CONTAINER SERVICES PTY LIMITED
	 
	 	 
	Authority:

	 	section 127 of the Corporations Act 2001

	 	 	 	 	 	 	 
	Signature of authorised

	 	/s/ Michael Powell
	 	Signature of authorised
	 	/s/ Aaron Powell
	person:

	 	 
	 	person:
	 	 
	 

	 	 
	 	 	 	 
	Name of authorised person:

	 	Michael Powell
	 	Name of authorised person:
	 	Aaron Powell
	 

	 	 
	 	 	 	 
	Office held:

	 	Director
	 	Office held:
	 	Director
	 

	 	 
	 	 	 	 

	 	 	Certified correct for the purposes of the Real Property Act 1900 by the
corporation named below the common seal of which was affixed pursuant to the
authority specified and in the presence of the authorised person(s) whose
signature(s) appears(s) below.

	 	 	 
	Corporation

	 	ROYAL WOLF TRADING AUSTRALIA PTY. LIMITED

	 
	 	 
	Authority:

	 	section 127 of the Corporations Act 2001

	 	 	 	 	 	 	 
	Signature of authorised

	 	/s/ Peter McCann
	 	Signature of authorised
	 	/s/ Michael Baxter
	person:

	 	 
	 	person:
	 	 
	 

	 	 
	 	 	 	 
	Name of authorised person:

	 	Peter McCann
	 	Name of authorised person:
	 	Michael Baxter
	 

	 	 
	 	 	 	 
	Office held:

	 	Company Secretary
	 	Office held:
	 	Director
	 

	 	 
	 	 	 	 

	(J)	 	STATUTORY DECLARATION

	 	 	 	1A    solemnly and sincerely declare that:

1.
The time for the exercise of option to renew in expired sublease No. ___ has ended;

2. The sublease under that sublease has not exercised the option.

I make this solemn declaration conscientiously believing the same to be true and by
virtue of the provisions of the Oaths Act 1900.

Made and subscribed at                                          in the State of New South Wales on
                                         in the presence of                                       
  

	 	 	 
	Signature of witness:

	 	Signature of sublessor:
	 
	 	 
	Name of witness:
	 	 
	 
	 	 
	Address of witness:
	 	 
	 
	 	 
	Qualification of witness:
	 	 
	 

	 	19/1/2007

Page 2 of 46

 

THIS IS ANNEXURE A REFERRED TO IN THE SUB-LEASE BETWEEN THE TYNE CONTAINER SERVICES
(ACN056659931)(SUB-LESSOR) AND ROYAL WOLF TRADING AUSTRALIA (ACN069244417)(SUB-LESSEE) DATED

Reference Schedule

	 	 	 	 	 
	Item 1

	 	Rent 267,185.16
	 	plus GST per annum
	 
	 	 	 	 
	(definition of Rent
in clause 1.1 and
clause 2)
	 	 	 	 
	 
	 	 	 	 
	Item 2

	 	Rent Review Dates	 	 
	 
	 	 	 	 
	(definition of Rent
Review Date in
clause and clause
3.1)	 	A. In respect of each of the following specified dates an
Index Review of of Rent will be conducted:

	 
	 	 	 	 
	 	 	     i.  Each anniversary of the Commencing Date including any
option period thereof

	 
	 	 	 	 
	 	 	B. In respect of each of the following specified dates an
Market Rent Review will be conducted:

	 
	 	 	 	 
	 	 	     i. On the exercise of each option.

	 
	 	 	 	 
	Item 3	 	Particulars of New Lease
	 
	 	 	 	 
	(Clause 23)

	 	Term	 	 
	 
	 	 	 	 
	 

	 	Commencing Date:
	 	7 February 2007
	 
	 	 	 	 
	 

	 	Terminating Date:
	 	6 February 2010
	 
	 	 	 	 
	 

	 	Rent Review Dates:
	 	7 February 2008

7 February 2009
	 
	 	 	 	 
	 	 	Market Rent Review on exercise of option.
	 
	 	 	 	 
	Item 4 Interest Rate
	 	 	 	 
	 
	 	 	 	 
	(clause 5.1.1)	 	2% above the Commonwealth Bank’s “Overdraft Index Rate”
	 
	 	 	 	 
	Item 5	 	Public Liability Insurance
	 
	 	 	 	 
	(clause 5.2)

	 	$20,000.00	 	 
	 
	 	 	 	 
	Item 6	 	Permitted Use
	 	 	Shipping container storage, repair and servicing depot

Page 3 of 46

 

	 	 	 	 	 
	Item 7	 	Sub-Lessor’s address for service:
	 
	 	 	 	 
	 	 	c/o Tiernan and Associates Lawyers, Suite 7, 64 Croydon
Street, Cronulla 2230.
	 
	 	 	 	 
	 	 	Sub-Lessee’s address for service:
	 
	 	 	 	 
	 	 	22-28 Edgeworth David Avenue, Hornsby, NSW.
	 
	 	 	 	 
	Item 9	 	Bank Guarantee
	 
	 	 	 	 
	 	 	Equivalent to 3 months Rent plus GST.
	 
	 	 	 	 
	Item 10	 	Guarantor
	 
	 	 	 	 
	 	 	Not applicable
	 
	 	 	 	 
	Item 11	 	Option to Renew
	 
	 	 	 	 
	 	 	Commencing 7 February 2010

Terminating 6 February 2012

Page 4 of 46

 

	1.	 	Definitions and Interpretation

	 	1.1	 	Definitions

     The following definitions apply in this Schedule unless the context requires otherwise.

Bank Guarantee means:

	 	(a)	 	an irrevocable and unconditional undertaking with no expiry
date on terms otherwise acceptable to the Sub-Lessor by a bank carrying on
business in Sydney requiring the bank to pay on demand, whether by one or more
requests, the amount equivalent in Rent for the number of months indicated in
Item 9; or

	 	(b)	 	a replacement or addition to it under clause 20;

	 	 	 	Business Day means a day other than a Saturday, Sunday, public holiday or bank
holiday in Sydney;
	 
	 	 	 	Commencing Date means 7 February 2007.
	 
	 	 	 	Containment means any substance, gas, liquid, chemical, mineral or other physical or
biological matter which is or may become toxic, flammable, inflammable or which is
otherwise harmful to the environment or any life form or which may cause pollution,
contamination or any hazard or increase in toxicity in the environment or may leak
or discharge or otherwise cause damage to any person, property or the environment.
	 
	 	 	 	Event Date means the date of re-entry, termination or acceptance of repudiation
under clause 16.
	 
	 	 	 	Governmental Authority means any government, local government, statutory body,
agency or department having authority in connection with a relevant thing;
	 
	 	 	 	GST has meaning given to it in the GST Act;
	 
	 	 	 	GST Act means a New Tax System (Goods and Services Tax) Act 1999 as amended from
time to time;
	 
	 	 	 	Guarantor means each person names in Item 10;
	 
	 	 	 	Headlessor means Eureka Tiles Australia Pty Limited (ACN 000 012 340) formerly known
as The Austral Tile Company Pty Limited);
	 
	 	 	 	Index Numbers means:

	 	(a)	 	the Consumer Price Index for Sydney (all groups) published from
time to time in the Commonwealth Statistician’s Summary of Australian
Statistics together with any supplementary summary;

Page 5 of 46

 

	 	(b)	 	if there is a suspension or discontinuance of the Consumer
Price Index by the Commonwealth Authorities, then it means the NSW Male Basic
or Minimum Wage applicable in the City of Sydney;
	 
	 	(c)	 	if there is no determination of the NSW Male Basic or Minimum
Wage applicable for the City of Sydney, then it means the Index published at
the relevant dates in the Commonwealth Statistician’s Summary of Australian
Statistics which reflects fluctuation of the cost of living in Sydney; or
	 
	 	(d)	 	if the parties cannot agree, the index nominated by the
President of the New South Wales Division of the Institute or that person’s
nominee;

	 	 	 	Index Rent Review Date means each Rent Review Date on which an Index Review of Rent
is to be conducted;
	 
	 	 	 	Insolvency Event means the happening of any of these events;

	 	(a)	 	an application is made to a court for an order or an order is
made that a body corporate be wound up;
	 
	 	(b)	 	an application is made to a court for an order appointing a
liquidator or provisional liquidator for a body corporate or one of them is
appointed, whether or not under an order;
	 
	 	(c)	 	except to reconstruct or amalgamate while solvent on terms
approved by the Sub-Lessor, a body corporate enters into, or resolved to enter
into, a scheme of arrangement or composition with, or assignment for the
benefit of, all or any class of its creditors, or it proposes a reorganization,
moratorium or other administration involving any of them;
	 
	 	(d)	 	a body corporate resolves to wind itself up, or otherwise
dissolve itself, or gives notice of intention to do so, except to reconstruct
or amalgamate while solvent on terms approved by the Sub-Lessor or is otherwise
wound up or dissolved;
	 
	 	(e)	 	a body corporate is or stares that it is solvent;
	 
	 	(f)	 	as a result of the operation of section 459(1) of the
Corporations Act 2001, a body corporate is taken to have failed to comply with
a statutory demand;
	 
	 	(g)	 	a body corporate is, or makes a statement from which it may be
reasonably deduced by the Sub-Lessor that the body corporate is, the subject of
an event described in section 459(2)(b) or section 585 of the Corporations Act
2001;

Page 6 of 46

 

	 	(h)	 	a body corporate takes any step to obtain protection or is
granted protection from its creditors, under any applicable legislation or an
administrator is appointed by a body corporate;
	 
	 	(i)	 	a person becomes an insolvent under administration as defined
in section 9 of the Corporations Act 2001 or action is taken which could result
in that event; or
	 
	 	(j)	 	anything analogous or having a substantially similar effect to
any of the events specified above happens under the law of any applicable
jurisdiction and including without limitation deregistration or dissolution;

	 	 	 	Institute means the Australian Property Institute (Incorporated) (NSW Division);
	 
	 	 	 	Interest Rate means the interest rate set out in Item 4 of the Reference Schedule;
	 
	 	 	 	Land means:

	 	(a)	 	the whole of the land described on the cover sheet; and
	 
	 	(b)	 	any other land that the Sub-Lessor uses with the land referred
to in (a) for the same purpose to which the Land is put, a parking area for
that land and other related undertaking;

	 	 	 	Lease Year means the period commencing on the Commencing Date and terminating on the
30th day of June immediately following the Commencement Date and then
each succeeding period of 12 months during the Term commencing on the 1st
day of July until and including the 30th day of June immediately
following;
	 
	 	 	 	‘Market Review Date’ means the date upon which the reviewed rent is to take effect
and as set out in item 3 of the Reference Schedule
	 
	 	 	 	Sub-Lessee means and includes the Sub-Lessee and its successors and permitted
assigns;
	 
	 	 	 	Sub-Lessee’s Business means the business carried on from the Premises;
	 
	 	 	 	Sub-Lessee’s Employee’s and Agents means each of the Sub-Lessee’s employees,
officers, agents, contractors and invitees;
	 
	 	 	 	Sub-Lessee’s Property means all property on the Premises that is not Sub-Lessor’s
Property including but not limited to trade fixtures, sign, fitting, plant or
equipment that the Sub-Lessee has brought into or installed in the Premises or
purchased from a previous Sub-Lessee of the Premises;
	 
	 	 	 	Sub-Lessor means the Sub-Lessor and its successors and assigns and in clauses 5.2,
5.3, 11.5, 12.2(a) and (b), 13.3(a) and (b) and includes the Headlessor;

Page 7 of 46

 

	 	 	 	Sub-Lessor’s Property means all plant, equipment, fixtures, fittings, furniture,
furnishings and other property the Sub- Lessor provides to the Premises;
	 	 	 	Overdraft Index Rate means;

	 	(a)	 	the Overdraft Index Rate for commercial loans on a monthly
charging cycle published by the Commonwealth Bank of Australia;
	 
	 	(b)	 	if there is any suspension or discontinuance of the Overdraft
Index Rate, then the substitute rate is the rate that the parties may mutually
agree upon; and
	 
	 	(c)	 	if they are unable to agree, then the rate that the President
of the Institute or that persons nominee determines and which is conclusive and
binding;

	 	 	 	Permitted Use means the use stated in Item 6 of the Reference Schedule;
	 
	 	 	 	Premises means that part of Lot 4 in DP1030800 as is indicated in the hatched area
in Annexure “B” including te Sub-Lessors Property
	 
	 	 	 	Reference Schedule means the reference schedule attached to the cover sheet of this
Lease which forms part of this Lease;
	 
	 	 	 	Rent means subject to an express statement- to the contrary, the amount shown in
Item 1 of the Reference Schedule as varied under this Lease;
	 
	 	 	 	Rent Review Date means teach date in Item 2 of the Reference Schedule;
	 
	 	 	 	Services means the services that a Governmental Authority, private utility company
or the Sub-Lessor provides to the Premises, including but not limited to water
drainage, fire fighting, electricity, telephone, telecommunications, air
conditioning, communications, lifts, escalators, gas, sewerage, fire-rated doors and
sprinkler system;
	 
	 	 	 	Taxable Supply has the meaning given to it in the GST Act;
	 
	 	 	 	Term means the period from and including the Commencing Date up to and including the
Terminating Date; and
	 
	 	 	 	Terminating Date means 6 February 2010.

     1.2 Interpretation

     The following rules or interpretation apply unless the context requires otherwise:

	 	(a)	 	headings are for convenience only and do not affect
interpretation;
	 
	 	(b)	 	the singular includes the plural and conversely;

Page 8 of 46

 

	 	(c)	 	a gender includes any gender;
	 
	 	(d)	 	if a word or phrase is defined, then its other grammatical
forms have a corresponding meaning;
	 
	 	(e)	 	a reference to person includes:

	 	(i)	 	a body corporate, an unincorporated or other
entity; and
	 
	 	(ii)	 	a reference to that person’s executors,
administrators, successors, permitted assigns and substitutes including
but not limited to a person to whom this agreement is novated;

	 	(f)	 	a reference to clause or schedule is to a clause or schedule to
this Lease;
	 
	 	(g)	 	a reference to an agreement or document is to that agreement or
document as amended, novated, supplemented, varied or replaced;
	 
	 	(h)	 	a reference to a thing including but not limited to a right,
includes a reference to a part of that thing;
	 
	 	(i)	 	a reference to legislation or to a provision of it includes a
modification or reenactment of it, a legislative provision substituted for it
and a regulation or statutory instrument under it;
	 
	 	(j)	 	a reference to conduct includes but is not limited to, a
omission, statement or undertaking whether or not in writing;
	 
	 	(k)	 	a provision of this sub-Lease must not be construed adversely
to a party on the grounds that the party is responsible for the preparation of
it;
	 
	 	(l)	 	an agreement, representation or warranty in favour of two or
more persons is for the benefit of them jointly and severally;
	 
	 	(m)	 	an agreement, representation or warranty on the part of two or
more persons binds them jointly and severally;
	 
	 	(n)	 	a reference to month is a reference to a calendar month;
	 
	 	(o)	 	a reference to year is a reference to a calendar year;
	 
	 	(p)	 	a reference to writing means any mode of representing and
reproducing words in tangible and permanently visible form and includes but is
not limited to business revenues, benefits or rights;
	 
	 	(q)	 	a reference to asset includes property of any nature including
but not limited to business revenues, benefits or rights;

Page 9 of 46

 

	 	(r)	 	a reference to liquidation includes but is not limited to an
arrangement; compromise, winding up, dissolution, official management,
appointment of administrator, assignment for the benefit of a creditor, scheme
of arrangement with creditors; insolvency, bankruptcy or a similar procedure or
if it applies, a merger, amalgamation reconstruction or change in the
constitution of an entity for the purpose or having the effect of altering a
party’s rights with the creditors;
	 
	 	(s)	 	a reference to a day including a Business Day is a reference to
the period which starts at midnight and ends 24 hours later;
	 
	 	(t)	 	if a period of time is specified and that period begins;

	 	(i)	 	at the time of an actor or event;
	 
	 	(ii)	 	on a specified date;

	 	 	 	then the calculation of the period begins on the clay following the day of
the act, the event or the specific date; and
	 
	 	(u)	 	a reference to an Item refers to an item in the Reference
Schedule.

	2.	 	Rent and Outgoings

	 	2.1	 	Rent

	 	(a)	 	The Sub-Lessee must pay the Rent:

	 	(i)	 	by equal monthly installments; and
	 
	 	(ii)	 	in advance on the first day of each month of
the Term and any holding over period.

	 	(b)	 	The Sub-Lessee must make the first payment on the Commencing
Date.

	 	2.2	 	Broken Periods

             If an installment of Rent is for a period of less than 1 month, then that installment is that
proportion of one twelfth of the Rent that the number of days in the period bears to the number of
days in the month in which that period begins.

Page 10 of 46

 

	3.	 	Rent Review

	 	3.1	 	From and including each Rent Review Date, the Rent for the period of the Term
to the first to occur of the next Rent Review Date or determination of the Lease, is
the sum calculated using the method for that Rent Review Date set out in Item 2
	 
	 	3.2	 	Rent Never to Decrease

             Despite anything in this Lease, including this clause 3, the Rent from and including the
relevant Rent Review Date is to be the greater of:

	 	(a)	 	the Rent immediately before the relevant Rent Review Date;
	 
	 	(b)	 	the amount determined under this clause 3.

	4.	 	Services and charges

	 	(a)	 	The Sub-Lessee must pay directly to the service provider the
accounts for the following Services to the Premises;

	 	(i)	 	electricity metered directly to the site;
	 
	 	(ii)	 	water metered directly to the site (if a water
meter is reasonably able to be installed); and
	 
	 	(iii)	 	telephone and telecommunications.

	 	(b)	 	If appropriate, the Sub-Lessee must pay;

	 	(i)	 	according to the meter reading; and
	 
	 	(ii)	 	at the time the payment is due.

	 	(c)	 	if there is no meter or a meter is defective, then the
Sub-Lessee must ensure that the person supplying the Services assesses the cost
of that Service.

	5.	 	Payment Requirements

	 	5.1	 	Method of payment

	 	(a)	 	The Sub-Lessee must make payments under this Lease;

	 	(i)	 	to the Sub-Lessor, or to a person the
Sub-Lessor nominates in a notice to the Sub-Lessee;
	 
	 	(ii)	 	by the method the Sub-Lessor reasonably
requires; and
	 
	 	(iii)	 	without set-off, counterclaim, withholding or
deduction.

Page 11 of 46

 

	 	(b)	 	The Sub-Lessor is only obliged to demand payment for an amount
that the Sub-Lessee must pay if this Lease expressly says that the Sub-Lessor
must demand that amount.
	 
	 	(c)	 	Expiry or termination of this Lease does not affect the
Sub-Lessee’s obligations to pay under this Lease for the period before expiry
or termination.

	 	5.1.1	 	Sub-Lessee’s obligation to pay interest

	 	(a)	 	If the Sub-Lessee does not pay on time each amount that it must
pay, then it must pay interest on that amount on the Sub-Lessor’s demand.
	 
	 	(b)	 	The Sub-Lessee must pay accumulated interest at the end of each
month without the Sub-Lessor’s demand.
	 
	 	(c)	 	Interest is calculated on daily balances at the Interest Rate.
	 
	 	(d)	 	The Sub-Lessee must pay interest on an amount from when it
becomes due for Payment until it pays the amount in full.

	 	5.1.2	 	GST

             If the Sub-Lessor is liable under the GST Act to pay GST on a Taxable Supply under this Lease
then despite any other provision of this Lease:

	 	(a)	 	a payment that the Sub-Lessee makes for the Taxable Supply
under this Lease, other than under this clause 5.1.2 is not grossed up for GST;
	 
	 	(b)	 	the Sub-Lessee must make each payment with an additional amount
for GST.
	 
	 	(c)	 	the Sub-Lessee must calculate the additional amount by
multiplying the payment by the prevailing GST rate; and
	 
	 	(d)	 	if the Sub-Lessee pays an additional amount under clause
5.3(b), then subject to the Sub-Lessee’s notification the Sub-Lessor must issue
to the Sub-Lessee a GST Invoice.

Insurance

	 	5.2	 	Insurance Obligations

	 	(a)	 	The Sub-Lessee must maintain for the Premises in the name of
the Sub-Lessee;

	 	(i)	 	an industrial special risks policy to insure
the Premises for their full reinstatement value against all risks which
include but are not limited to fire, lightning, storm and tempest the
Sub-Lessor
reasonably considers it appropriate to insure the Premises against,
acting reasonably for their full reinstatement value;

Page 12 of 46

 

	 	(ii)	 	public and products liability insurance and
property owner’s liability and tenant’s liability insurance for at
least the amount in Item 5 of the Reference Schedule, as varied by
notice from the Sub-Lessor to the Sub-Lessee;
	 
	 	(iii)	 	workers’ compensation and employee protection
insurance; and
	 
	 	(iv)	 	insurance for the Sub-Lessee’s Property,

	 	(b)	 	All insurance policies particularised in paragraph 5.2 (a)
herein must note the Interest of the Sublessor.

	 	5.3	 	Nature and proof of contracts

	 	(a)	 	The Sub-Lessee must ensure that each insurance contract is:

	 	(i)	 	with insurers and on terms the Sub-Lessor
approves; sand
	 
	 	(ii)	 	in the name of the Sub-Lessee and notes the
interest of the Sub-Lessor

	 	(b)	 	The Sub-Lessee must ensure that each insurance contract
includes:

	 	(i)	 	a cross liability clause; and (ii) a waiver of
subrogation clause.

	 	(c)	 	The Sub-Lessee must, when the Sub-Lessor demands, give the
Sub-Lessor evidence that it has complied with this clause 5.

	 	(d)	 	The Sub-Lessee must notify the Sub-Lessor immediately if an
insurance policy required by this clause 5 is:

	 	(i)	 	cancelled; or
	 
	 	(ii)	 	an event occurs which may allow a claim or
affect a right under an insurance policy for the Premises or any
property in the Premises.

	 	5.4	 	Claims under insurance

	 	(a)	 	The Sub-Lessee must act enforce, conduct, settle or compromise
a claim under an insurance policy required by this Lease if the Sub-Lessor
gives the Sub-Lessee a notice that the Sub-Lessor wishes to enforce, conduct,
settle or compromise a claim.
	 
	 	(b)	 	This clause 5.4 applies even if an insurance policy also covers
property that is not property that the Sub-Lessor must insure under this Lease.

Page 13 of 46

 

	 	(c)	 	The Sub-Lessee must obtain the Sub-Lessor’s approval before it
does anything which may:

	 	(i)	 	affect a right under an insurance policy; or
	 
	 	(ii)	 	increase an insurance premium payable on a
policy for the Premises or any property in the Premises.

	 	5.5	 	Sub-Lessee Indemnifies

             The Sub-Lessee indemnifies the Sub-Lessor to the extent that any of the insurance is
insufficient to reinstate the Premises and/or the property covered by the policy to its condition
prior to the damage or destruction, except to the extent that any amount payable under the
insurance is reduced or any claim under such policy is avoided by any willful act, omission,
neglect or default of the Sub-Lessor.

	 	5.6	 	Condition of each Insurance

	 	(a)	 	It must be a condition of each insurance affected by the
Sub-Lessee (except worker’s compensation; or
	 
	 	(b)	 	the insurer should provide a written undertaking that;

the insurance will not be cancelled by the insurer or its terms or conditions of cover provided
under the insurance will not be materially altered, except after the insurer has given the
Sub-Lessor at least 14 days written notice of its intention relating to any of those matters.

	 	5.7	 	Proceeds of Insurance

	 	(a)	 	The Sub-Lessee must ensure that insurance proceeds which the
insured person is not obliged to use for replacement or reinstatement are paid
into a separate joint account in the names of the Sub-Lessor, the Sub-Lessee
and if required by the Sub-Lessor, any other person.

	6.	 	Indemnities and releases

	 	6.1	 	Sub-Lessee indemnities

	 	(a)	 	The Sub-Lessee occupies and uses the Premises at its own risk.
	 
	 	(b)	 	The Sub-Lessee is liable for and indemnifies the Sub-Lessor to
the extent of the Liability, loss or damage arising from and cost incurred for
any of the following:

	 	(i)	 	damage, loss injury or death caused or
contributed to by the act, negligence or default of the Sub-Lessee or
of the Sub-Lessee’s Employees and Agents;

Page 14 of 46

 

	 	(ii)	 	the Sub-Lessee’s breach of an environmental or
occupational health and safety law;
	 
	 	(iii)	 	the Sub-Lessee’s breach of the Lease; and
	 
	 	(iv)	 	an accident on or about the Premises that the
Sub-Lessor has not contributed to or caused.

	 	(c)	 	The Sub-Lessee agrees that the Sub-Lessor is not liable for
anything listed in clause 7.1.
	 
	 	(d)	 	Each indemnity:

	 	(i)	 	is independent from the Sub-Lessee’s other
obligations; and
	 
	 	(ii)	 	continues during this Lease and after it
expires or is terminated.

	 	(e)	 	The Sub-Lessor may enforce an indemnity before incurring an
expense.

	 	(f)	 	Clause 6.(b) does not apply if the damage, loss, injury or
death is caused by the Sub-Lessor’s willful act, negligence or default.

	 	6.2	 	Sub-Lessee releases Sub-Lessor

	 	(a)	 	The Sub-Lessee releases the Sub-Lessor from liability or loss
arising from and cost incurred by any of the following:

	 	(i)	 	damage, loss, injury or death relating to the
Premises;
	 
	 	(ii)	 	anything the Sub-Lessor is permitted or
required to do under this Lease;
	 
	 	(iii)	 	The unavailability, interruption or
malfunction of:

	 	(A)	 	a Service; or
	 
	 	(B)	 	the Sub-Lessor’s Property;

	 	(iv)	 	the premises not being clean or secure;
	 
	 	(v)	 	a fire, bomb threat or other emergency drill or
the Sub-Lessee evacuating the Premises because of any fire, bomb threat
or other emergency;
	 
	 	(vi)	 	the operation of a statue, regulation or notice
that a Governmental Authority issues relating to the Premises; and
	 
	 	(vii)	 	a strike, accident, riot, industrial action or
civil disturbance.

Page 15 of 46

 

	 	(b)	 	clause 6.2(a) does not apply if the damage, loss, injury or death so caused
by the Sub-Lessor’s willful act, negligence or default.

	7.	 	Use
	 
	 	 	The Sub-Lessee must only use the Premises for the Permitted Use.
	 
	8.	 	Sub-Lessee’s covenants

	 	(a)	 	The Sub-Lessee must comply on time with each law and
requirement of a Governmental Authority in connection with;

	 	(i)	 	the Premises, the Sub-Lessee’s Business, the
Sub-Lessee’s Property; and
	 
	 	(ii)	 	the use or occupation of the Premises

	 	(b)	 	A reference to compliance includes but is not limited to
obtaining and complying with a permit or approval.
	 
	 	(c)	 	The Sub-Lessee is only required to carry out structural work if
the work is required:

	 	(i)	 	for the lawful use of our occupation of the
Premises; or
	 
	 	(ii)	 	as a result of the act, negligence or default
of the Sub-Lessee or of the Sub-Lessee’s Employee’s and Agents.

	 	(d)	 	the Sub-Lessee must:

	 	(i)	 	inform the Sub-Lessor of damage to the Premises
or of a faulty Service immediately it becomes aware of it;
	 
	 	(ii)	 	participate in each fire, bomb threat or other
emergency drill of which the Sub-Lessor gives reasonable notice;
	 
	 	(iii)	 	evacuate the Premises immediately ad in
accordance with the Sub-Lessor’s directions when informed of an actual
or suspected fire, bomb threat or other emergency;
	 
	 	(iv)	 	take all reasonable precautions to keep the
Premises free of any pest, vermin or animals.

	 	(e)	 	The Sub-Lessee may only:

	 	(i)	 	alter the Sub-Lessor’s Property or remove it
from the Premises if it first obtains the Sub-Lessor’s approval;

Page 16 of 46

 

	 	(ii)	 	store, bring onto, use or release Contaminants
on the Premises if it is necessary for the Permitted Use;
	 
	 	(iii)	 	manufacture, produce or carry on an activity
which creates or leads to the creation of Contaminants if it is
necessary for the Permitted Use; and
	 
	 	(iv)	 	use the Premises’ facilitates or Services for
their intended purpose.

	 	(f)	 	The Sub-Lessee must not:

	 	(i)	 	permit the Premises or the environment to be
contaminated, polluted or affected by Contaminants;
	 
	 	(ii)	 	do or omit to do anything that results in a
governmental Authority issuing notice, direction or order requiring a
clean up, decontamination, remedial action or making good, under any
law;
	 
	 	(iii)	 	do or omit to do anything that constitutes a
violation or contravention of law the environment or occupational
health and safety;
	 
	 	(iv)	 	do anything in or around the Premises that is
in the Sub-Lessor’s reasonable opinion may be annoying, dangerous or
offensive;
	 
	 	(v)	 	do anything to overload or interfere with the
Premises’ facilities or Services; or
	 
	 	(vi)	 	allow anything to endanger or threaten the
Premises or occupants of the Premises.

	 	(g)	 	If the Sub-Lessee may not do something under this Lease, then
it may not do anything which may result in it happening.
	 
	 	(h)	 	The Sub-Lessee must ensure that the Sub-Lessee’s Employees and
Agents comply, if appropriate, with the Sub-Lessee’s obligations.
	 
	 	(i)	 	The Sub-Lessee must maintain and repair in good order and
condition (having regard to the condition at the Commencing Date) the storm
water detention basin, pit and storm water drainage system on the Premises and
ensure that ground water run off from the Premises is channeled into the storm
water detention basin.

	9.	 	Cleaning the Premises
	 
	 	 	The Sub-Lessee must:

	 	(a)	 	keep the Premises clean, tidy and free of refuse, pests and
vermin;

Page 17 of 46

 

	 	(b)	 	comply with the Sub-Lessor’s directions on cleaning;
	 
	 	(c)	 	employ a cleaning service that the Sub-Lessor approves; and
	 
	 	(d)	 	arrange for a person to remove regularly, refuse from the
Premises.

	10.	 	Sub-Lessor not liable

	 	(a)	 	The Sub-Lessor is not liable to the Sub-Lessee for financial
loss or inconvenience, including but not limited to a liability for damages,
abatement of rent or for repudiation, because any Services are:

	 	(i)	 	not functioning either property or at all; or
	 
	 	(ii)	 	temporarily stopped or interrupted;

	 	(A)	 	for any cause beyond the
Sub-Lessor’s control; or
	 
	 	(B)	 	pending inspection, repair,
maintenance or replacement.

	 	(b)	 	The Sub-Lessee is not entitled to terminate this ease for any
of the reasons referred to in clause 10(a).

	11.	 	Repair, redecoration and tenant’s works

	 	11.1	 	Sub-Lessor’s Approval

	 	(a)	 	The Sub-Lessee may only carry out works including but not
limited to installing fixtures or fittings or making alterations to or in the
Premises if it first obtains the Sub-Lessor’s written approval.
	 
	 	(b)	 	The Sub-Lessor must not unreasonably withhold its approval
referred to in clause 11.1(a).
	 
	 	(c)	 	The Sub-Lessor may make its approval subject to reasonable
conditions, including, but not limited to, obtaining the consent of the Lessor.
	 
	 	(d)	 	The Sub-Lessee must comply with the Sub-Lessor’s conditions.

	 	11.2	 	Sub-Lessee’s Works

	 	(a)	 	The Sub-Lessee must ensure that any work it does, including but
not limited to work under clauses 11.1 and 11.4:

	 	(i)	 	is done:

	 	(A)	 	in accordance with the plans,
specifications and schedule of finishes approved by the
Sub-Lessor;

Page 18 of 46

 

	 	(B)	 	by contractors and consultants
who the Sub-Lessor either nominates or approves;
	 
	 	(C)	 	in a proper and workmanlike
manner; and
	 
	 	(D)	 	without disturbance or disruption
to other tenants or occupants of the adjoining land of the
Sub-Lessor;

	 	(ii)	 	complies with each law and the requirements of
each relevant Governmental Authority; and
	 
	 	(iii)	 	follows the Sub-Lessor’s requirements and
directions.

	 	(b)	 	The Sub-Lessee must promptly (where applicable) obtain and give
to the Sub-Lessor:

	 	(i)	 	a certificate of occupancy issued under the
Environmental Planning and Assessment Act 1979;
	 
	 	(ii)	 	a building certificate under section 149A of
the Environmental Planning and Assessment Act 1979 or equivalent
certificate for the works on their completion; and
	 
	 	(iii)	 	any certificate which the Sub-Lessor requires
from an architect, engineer or other consultant which the Sub-Lessor
nominates.

	 	(c)	 	The Sub-Lessor must act reasonably under this clause 11.2.
	 
	 	(d)	 	If the Sub-Lessor believes that the Sub-Lessee is in breach of
any provision of this Lease including, 12.2, then:

	 	(i)	 	the Sub-Lessor may only request the Sub-Lessee
to stop, and
	 
	 	(ii)	 	the Sub-Lessee must stop carrying out the
words.

	 	11.3	 	Repair of Items

          The Sub-Lessee acknowledges that the Premises are in good repair at the Commencing Date.

	 	11.4	 	Repair, replace and redecorate

	 	(a)	 	Subject to fair wear and tear, the Sub-Lessee must keep the
Premises and the Sub-Lessee’s Property in good repair and condition.
	 
	 	(b)	 	The Sub-Lessee must replace any items of Sub-Lessor’s Property
with items of similar quality as at the Commencing Date if damaged by the
Sub-Lessee.

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	 	(c)	 	The Sub-Lessee must make good promptly any damage that the
Sub-Lessee or the Sub-Lessee’s Employee’s and Agents cause to the Premises.

	 	11.5	 	Signage

	 	(a)	 	The Sub-Lessee must obtain the Sub-Lessor’s permission in
writing before it erects or displays a sign within the Premises so that a
person can see the sign from the exterior of the Premises.
	 
	 	(b)	 	The Sub-Lessor must not unreasonably withhold its consent,
	 
	 	(c)	 	If the Sub-Lessee erects a sign, then the Sub-Lessee must:

	 	(i)	 	obtain the consent of any relevant Governmental
Authority;
	 
	 	(ii)	 	erect the sign in a workmanlike manner;
	 
	 	(iii)	 	repair any damage that it causes when erecting the sign;
	 
	 	(iv)	 	upon the termination of this Lease, remove the sign; and
	 
	 	(v)	 	repair any damage caused to the Premises by the
removal of the sign.

	 	(d)	 	This clause is not intended to limit clauses 11.1 and 11 .2.

	12.	 	Assignment and other dealings.

	 	12.1	 	No assignment or subletting

          This Sub-Lessee must not part with possession of the Premises, including but not limited to
parting with possession by assigning, subletting or licensing without the Sub-Lessor’s (and
Head-Lessor’s) prior written consent.

	 	12.2	 	Conditions of subletting licensing, etc.

          The Sub-Lessor may not unreasonably withhold its consent where the Sub-Lessee:

	 	(a)	 	satisfies the Sub-Lessor that the proposed assignee, sub-tenant
licensee or other person taking possession (each called in this clause the New
Sub-Lessee):

	 	(i)	 	its financially sound and capable of performing
the Sub—Lessee’s obligations under this Lease; and
	 
	 	(ii)	 	will use the Premises only for the Permitted
Use;

	 	(b)	 	ensures that the New Sub-Lessee signs a contract relating to
the change in possession in the form that the Sub-Lessor reasonably requires;

Page 20 of 46

 

	 	(c)	 	ensures that the New Sub-Lessee (in the case of an assignment)
gives the Sub-Lessor a three month bank guarantee and director’s guarantee (in
the case of a corporate assignee);
	 
	 	(d)	 	ensures that the Sub-Lessee has obtained any consents it has
agreed to obtain;
	 
	 	(e)	 	ensures that the Sub-Lessee is not in default or any default
has been waived;
	 
	 	(f)	 	ensures that he Sub-Lessee and the New Sub-Lessee complies with
all the Sub-Lessor’s reasonable requirements.

	 	12.3	 	Change in control of Sub-Lessee

	 	(a)	 	A proposed change in control is treated as a proposed parting
with possession under this Sub-Lease.
	 
	 	(b)	 	The person acquiring control is treated as new Sub-Lessee.
	 
	 	(c)	 	A change in control occurs if:

	 	(i)	 	the Sub-Lessee is a company which is not listed
or wholly owned by a company which is listed on the Australian Stock
Exchange; and
	 
	 	(ii)	 	there is a proposed change in the shareholding
of the Sub-Lessee or its holding company so that a different person
from that existing at the date the Sub-Lessee acquired its interest in
this Lease will control:

	 	(A)	 	the composition of the board of
directors; or
	 
	 	(B)	 	more than 50% of the shares
giving a right to vote at general meetings.

	 	12.4	 	Securities

	 	(a)	 	The Sub-Lessee must first obtain the Sub-Lessor’s approval
before it creates or allows to come into existence:

	 	(i)	 	a security over the Sub-Lessee’s interest in
this Lease; or
	 
	 	(ii)	 	a lease or security affecting the Sub-Lessee’s
Property;

	 	(b)	 	The Sub-Lessor must not unreasonably withhold its approval.
	 
	 	(c)	 	If the Sub-Lessor gives its approval, the Sub-Lessee must
execute a waiver if the Sub-Lessor reasonably requires the Sub-Lessee to do so.

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	12.5	 	Release on Assignment

          In the event of the Sub-Lessee lawfully assigning this Lease to another party, the Sub-Lessor
will release the assigning Sub-Lessee from all obligations under this Lease, except in respect of
anything which remains to be done before the date of the assignment.

	13.	 	Sub-Lessor’s additional obligations and rights

	 	13.1	 	Quiet Enjoyment

          Subject to the Sub-Lessor’s rights, while the Sub-Lessee complies with its obligations under
this Lease, it may occupy the Premises during the Term without undue interference by the
Sub-Lessor.

	 	13.2	 	Sub-Lessor’s limits of obligation in relation to Services

          The Sub-Lessee may not claim compensation, damages, terminate this Lease or stop or reduce
payments under it because:

	 	(a)	 	a Service is not available, a Service is interrupted or fails;
or
	 
	 	(b)	 	any part of the Sub-Lessor’s Property breaks down.

	 	13.3	 	Suitability

	 	(a)	 	The Sub-Lessee represents to the Sub-Lessor that it has
satisfied itself that the Premises and the Services are suitable for the
Permitted Use.
	 
	 	(b)	 	The Sub-Lessor does not expressly or impliedly warrant that the
Premises are now or will remain suitable or adequate for all or any of the
purposes of the Sub-Lessee; and subject to the law, any such warranties are
expressly negatived.

	 	13.4	 	Sub-Lessor’s Rights

	 	(a)	 	Subject to clause 13.5 the Sub-Lessor may carry out any works
on or to the Premises including but not limited to alterations and
redevelopment.
	 
	 	(b)	 	If the works are likely to adversely affect the business of the
Sub-Lessee, then the Sub-Lessor must notify the Sub-Lessee in writing of the
proposed alteration or refurbishment at least 2 months before it commences the
works and the Sub-Lessee is entitled to an abatement of Rent in respect of the
area on which the Sub-Lessor is conducting the works which are having an
adverse effect on the business of the Sub-Lessee.

	 	13.5	 	To Enter

	 	(a)	 	The Sub-Lessor may enter the Premises at reasonable times on
reasonable notice:

Page 22 of 46

 

	 	(i)	 	to see if the Sub-Lessee is complying with its
obligations under this Lease; or
	 
	 	(ii)	 	to do anything:

	 	(A)	 	that either party must or may do
under this Lease; or
	 
	 	(B)	 	necessary to comply with any law
or the requirements of a Governmental Authority.

	 	(b)	 	If the Sub-Lessor decides there is an emergency then it may
enter at any time without notice.

	 	13.6	 	Change of Sub-Lessor

	 	(a)	 	If the Sub-Lessor deals with its interest in the Land,
including but not limited to, by transfer or the grant of a head or concurrent
lease so that another entity becomes Sub-Lessor, then the Sub-Lessor is
released from each obligations under this Lease arising after it ceases to be
Sub-Lessor, except in respect of any right arising before the completion of the
transfer or other dealing.
	 
	 	(b)	 	If requested by the Sub-Lessor, the Sub-Lessee must sign the
documents which that person reasonably requires to give a direct contractual
relationship with the Sub-Lessee provided that the Sub-Lessee resumes no
greater obligation then it currently has under this Lease.

	 	13.7	 	Sub-Lessor may rectify.

	 	(a)	 	The Sub-Lessor may do anything that the Sub-Lessee should have
done under this Lease but:

	 	(i)	 	has not done; or
	 
	 	(ii)	 	that the Sub-Lessor considers it has not done
properly.

	 	(b)	 	The Sub-Lessee must promptly pay all reasonable expenses and
costs that the Sub-Lessor incurs under this clause 13.7.

	 	13.8	 	Access for Services

          The Sub-Lessor reserves the following rights:

	 	(a)	 	the right of uninterrupted passage of Services through pipes,
ducts and wires in the Premises;
	 
	 	(b)	 	the running of materials supplied by ducted services through
the pipes, ducts or wires to any part of the Premises; and

Page 23 of 46

 

	 	(c)	 	access to and through the Preemies any time for the purpose of
installing, maintaining, or repairing any Service included but not limited to:

	 	(i)	 	air conditioning equipment;
	 
	 	(ii)	 	fire sprinkler systems;
	 
	 	(iii)	 	pipes, ducts, telephone cables, wires, and
	 
	 	(iv)	 	water sewerage and drainage connections.

	 	13.9	 	Sub-Lessor Not Obliged

          Nothing in this clause obliges the Sub-Lessor to do any of the things it reserves the right to
do in this clause 13.

	14.	 	Sub-Lessee’s obligations on expiry or termination

	 	14.1	 	Condition of Premises

	 	(a)	 	The Sub-Lessee must:

	 	(i)	 	vacate the Premises on the earlier of the
Terminating Date and the date the Lease is terminated;
	 
	 	(ii)	 	reinstate the Premises and the services
benefiting the Premises to their condition at the Commencing Date or
the date the Sub-Lessee took occupation of the Premises if this Lease
is granted pursuant to an option; and
	 
	 	(iii)	 	surrender the Premises to the Sub-Lessor

	 	(A)	 	in good repair;
	 
	 	(B)	 	free from rubbish
	 
	 	(C)	 	free from damages; and
	 
	 	(D)	 	in a clean condition.

	 	(b)	 	The parties must take into account when assessing the condition
at termination;

	 	(i)	 	the condition of the Premises at the Commencing
Date; and
	 
	 	(ii)	 	fair wear and tear.

	 	(c)	 	The Sub-Lessee is not responsible for damage by fire, flood,
lighting, storm, tempest, act of God and war unless:

Page 24 of 46

 

	 	(i)	 	the damage occurred as a result of or was
substantially contributed to by the Sub-Lessee’s act or omission or
that of the Sub-Lessee’s Employees and Agents; or
	 
	 	(ii)	 	the Sub-Lessor is unable to recover from its
insurer insurance money for the damage because of some act or omission,
neglect, default or misconduct by the Sub-Lessee or the Sub-Lessee’s
Employees and Agents.

	 	14.2	 	Removal of Sub-Lessee’s Fixtures

	 	(a)	 	The Sub-Lessee may, up to the termination of this Lease, remove
from the Premises any of the Sub-Lessee’s Property.
	 
	 	(b)	 	The Sub-Lessor may require the Sub-Lessee to remove an item by
the time the Presses are vacated.
	 
	 	(c)	 	The Sub-Lessee must ensure that it does not damage the Premises
when it removes an item.
	 
	 	(d)	 	If the Sub-Lessee does damage the Premises, then it must at its
own cost immediately repair the damage;
	 
	 	(e)	 	if required by the Sub-Lessor, the Sub-Lessee must restore the
Premises to the condition that it was in before the Sub-Lessor brought in or
installed the relevant item.

	 	14.3	 	Sub-Lessee’s fixtures not removed

	 	(a)	 	if the Sub-Lessee does not comply with clause 14.2 then without
affecting any other right, the Sub-Lessor may at the expense of the Sub-Lessee:

	 	(i)	 	remove and store an item;
	 
	 	(ii)	 	repair any damage caused by any removal;
	 
	 	(iii)	 	recover the cost of the removal and repair
from the Sub-Lessee; and
	 
	 	(iv)	 	notify the Sub-Lessee that unless the
Sub-Lessee complies with its obligations within 14 days of the notice,
then any item that the Sub-Lessee does not remove from the Premises
will be forfeited to the Sub-Lessor.

	 	(b)	 	If the Sub-Lessee fails to comply with the notice, then the
items mentioned in the notice, become the property of’ the Sub-Lessor at the
expiration of the 14 day period.

Page 25 of 46

 

	 	(c)	 	The Sub-Lessor may retain any furniture, fittings, fixtures or
other items belonging to the Sub-Lessee in the Premises.
	 
	 	(d)	 	The Sub-Lessor may:

	 	(i)	 	sell an item that the Sub-Lessee forfeits in
accordance with clause 14.3(b) by public auction; and
	 
	 	(ii)	 	apply the proceeds of the sale towards the
payment of any money due and payable to the Sub-Lessor under this
Lease.

	15.	 	Holding over

	 	15.1	 	Monthly tenancy

	 	(a)	 	If the Sub-Lessee continues to occupy the Premises after the
Terminating Date with the Sub-Lessor’s approval, it does so under a monthly
tenancy.
	 
	 	(b)	 	Either party may terminate a monthly tenancy on one month’s
notice ending on any day.
	 
	 	(c)	 	The rent for each month of the monthly tenancy is equal to the
monthly Rent that the Sub-Lessee has paid for the month immediately preceding
the holding over period.
	 
	 	(d)	 	Subject to this clause 15.1, the monthly tenancy is on the same
terms as this Lease except for those changes that:

	 	(i)	 	are necessary to make this Lease appropriate
for a monthly tenancy; or
	 
	 	(ii)	 	the Sub-Lessor requires as a condition of
giving its approval to the holding over.

	 	(e)	 	The Sub-Lessor may require an increase in rent as a condition
of giving its approval to the holding over.
	 
	 	(f)	 	The parties must not reduce a bank guarantee required under
this Lease.

	16.	 	Default

	 	16.1	 	Essential terms

	 	(a)	 	The following obligations are essential terms of this Lease:

	 	(i)	 	each obligation of the Sub-Lessee to pay money
and to provide the Bank Guarantee or other security, including the
Guarantee from the guarantor to the Sub-Lessor; and

Page 26 of 46

 

	 	(ii)	 	the Sub-Lessee’s obligations under clause 2, 5,
7, 11 and 12.

	 	(b)	 	Other obligations under this Lease may also be essential terms.

	 	16.2	 	Default

          Each of the following constitutes a default by the Sub-Lessee under this Lease:

	 	(a)	 	The Sub-Lessee’s failure to pay rent to the Sub-Lessor for a
period of 14 days after the due date for payment, whether a formal demand for
payment has or has not been made;
	 
	 	(b)	 	the Sub-Lessee’s failure to comply with an obligation under
this Lease, which is not an essential term and in the Sub-Lessor’s reasonable
opinion:

	 	(i)	 	the non-compliance:

	 	(A)	 	can be remedied, and
	 
	 	(B)	 	the Sub-Lessee does not remedy it
to the Sub-Lessor’s reasonable satisfaction within a reasonable
time after the Sub-Lessor gives the Sub-Lessee notice to remedy
it;

	 	(ii)	 	the non-compliance cannot be remedied or
compensated for; (iii) the non-compliance cannot be remedies but:

	 	(A)	 	the Sub-Lessor can be
compensated; and
	 
	 	(B)	 	The Sub-Lessee does not pay the
Sub-Lessor compensation satisfactory to the Sub-Lessor for the
breach within 14 days after the Sub-Lessor gives the Sub-Lessee
notice to pay it; or

	 	(c)	 	an Insolvency Even occurring in respect of the Sub-Lessee or a
Guarantor.

	 	16.3	 	Termination After Default

          If the Sub-Lessee defaults under this Lease, then the Sub-Lessor may terminate this Lease by:

	 	(a)	 	re-entering and taking possession of the Premises, using
reasonable force if necessary to resume possession;
	 
	 	(b)	 	serving on the Sub-Lessee written notice terminating the Lease;
	 
	 	(c)	 	instituting proceeding for possession of the Premises; or
	 
	 	(d)	 	taking the action in both clause 16.3(a) and clause 16.3(b), or
clause 16.3(b) and clause 16.3(c).

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	 	16.4	 	Sub-Lessor’s Entitlement to Damages

	 	(a)	 	Whether this Lease is terminated or not, the Sub-Lessee must
compensate the Sub-Lessor for the loss or damage that the Sub-Lessor suffers as
a consequence of the Sub-Lessee’s conduct which constitutes:

	 	(i)	 	a repudiation of the Lease;
	 
	 	(ii)	 	a repudiation of the Sub-Lessee’s obligations under this Lease;
	 
	 	(iii)	 	a default; or
	 
	 	(iv)	 	breach of an essential item of this Lease.

	 	(b)	 	The compensation that the Sub-Lessor is entitled to recover
from the Sub-Lessee includes but it not limited to:

	 	(i)	 	all arrears of money payable by the Sub-Lessee;
	 
	 	(ii)	 	any interest on that money calculated in each
case;
	 
	 	(iii)	 	each cost including but not limited to the
Sub-Lessor’s administration costs that the Sub-Lessor incurs in
rectifying the Sub-Lessee’s breach.
	 
	 	(iv)	 	each cost that the Sub-Lessor incurs in
recovering any money or enforcing any security for the performance of
the Sub-Lessee’s obligation; and
	 
	 	(v)	 	each cost that the Sub-Lessor incurs:

	 	(A)	 	for legal fees and expenses;
	 
	 	(B)	 	for marketing and agency fees;
and
	 
	 	(C)	 	in performing the obligations of
the Lease.

	 	(c)	 	The Sub-Lessee must pay within 10 business days of receiving
the Sub-Lessor’s written demand for compensation.

	 	16.5	 	Liquidated Damages

	 	(a)	 	In addition to the Sub-Lessor’s other rights and remedies, the
Sub-Lessee must pay to the Sub-Lessor damages for the breach or repudiation if
the Sub-Lessor;

	 	(i)	 	enters the Premises;
	 
	 	(ii)	 	terminates the Lease under clause 16.3; or

Page 28 of 46

 

	 	(iii)	 	accepts the Sub-Lessee’s repudiation.

	 	(b)	 	The Sub-Lessee must pay damages equal to:

	 	(i)	 	the costs and expenses of the Sub-Lessor for
reletting the Premises including but not limited to a commission or
similar charge; and
	 
	 	(ii)	 	the difference between:

	 	(A)	 	all money that the Sub-Lessee
would have had to pay as Rent and Outgoing for that part of the
Term as had not expired at the Event Date; and
	 
	 	(B)	 	any money that the Sub-Lessor
has, at the date of the Sub-Lessor’s demand actually received or
reasonably anticipates it is likely it receive as rent and
outgoing from another Sub-Lessee of the Premises for the part if
the Term that had not expired at the Event Date.

	 	(c)	 	The Sub-Lessor must use reasonable endeavours to obtain another
Sub-Lessee
	 
	 	(d)	 	The conduct of the Sub-Lessor in using reasonable endeavours
does not of itself constitute acceptance of the Sub-Lessee’s breach or
repudiation of this Lease.
	 
	 	(e)	 	The parties must assume that the Rent would be the same as the
amount payable immediately before the relevant Rent Review Date r on any review
under clause 3 which was due to take place after the Event Date.
	 
	 	(f)	 	The Sub-Lessor’s determination of the amount it reasonably
anticipates it is likely to receive as rent and outgoings is final and binding
on the parties if:

	 	(i)	 	if excludes cleaning charges;
	 
	 	(ii)	 	in considers:

	 	(A)	 	the period or likely period
during which the Premises have been or may be vacant;
	 
	 	(B)	 	any rent free period and
abatement, concession, incentive or inducement allowed, granted
or paid or likely to be allowed; granted or paid to secure a new
Sub-Lessee or occupier; and

	 	(iii)	 	it is made in good faith.

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	 	(g)	 	To this extent that the sum of damages represents an
acceleration of payments, the parties must:

	 	(i)	 	discount the sum at a rate per annum equal to
the Commonwealth Bank’s Overdraft Index Rate quoted on the Event Date;
and
	 
	 	(ii)	 	calculate the discount with effect from the day
on which the Sub-Lessor receives the damages in full, less the
discount.

	 	(h)	 	This clause 16.5

	 	(i)	 	continues to operate if this Lease is
terminated;
	 
	 	(ii)	 	does not limit a right of the Sub-Lessor to
recover damages for any other loss;
	 
	 	(iii)	 	the Sub-Lessor’s acceptance of the Sub-Lessee
repudiation; or (iv) the parties; conduct constituting a surrender by
operation of the law.

	 	16.6	 	Sub-Lessor’s Rights not affected

          The rights and entitlements conferred on the Sub-Lessor by this clause 16 or their exercise:

	 	(a)	 	does not restrict or prevent the Sub-Lessor from recovering
loss or damage from:

 

	 	(i)	 	the Sub-Lessee;
	 
	 	(ii)	 	any security provided by or on behalf of the
Sub-Lessee; or
	 
	 	(iii)	 	exercising any other right or remedy which the
Sub-Lessor has or may acquire;

	 	(b)	 	are not adversely affected by:

	 	(i)	 	granting the Sub-Lessee a concession
indulgence, forbearance or time to pay;
	 
	 	(ii)	 	any compounding or compromise reached or
attempted to be reached with the Sub-Lessee;
	 
	 	(iii)	 	the Sub-Lessor’s acceptance of any money
whether paid by the Sub-Lessee or by any other person;
	 
	 	(iv)	 	a postponement non-exercise or alteration of a
right or remedy available to the Sub-Lessor;

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	 	(v)	 	an alteration to this Lease whether or not the
Sub-Lessor agrees to it in writing;
	 
	 	(vi)	 	the conversion of the Term of this Lease to a
monthly tenancy;
	 
	 	(vii)	 	the Sub-Lessor retaking possession of the
whole or a pert of the Premises by any means;
	 
	 	(viii)	 	the Sub-Lessee abandoning or vacating the Premises;
	 
	 	(ix)	 	the Sub-Lessor electing to re-enter or to
terminate the Lease;
	 
	 	(x)	 	the Sub-Lessor accepting the Sub-Lessee’s
repudiation, or
	 
	 	(xi)	 	the party’s conduct constituting a surrender by
operation of law.

	 	16.7	 	Conversion to a Monthly Tenancy

          if an event specified in clause 16.2 occur, then the Sub-Lessor may by notice to the
Sub-Lessee convert this Lease into a monthly

          tenancy.

          The Sub-Lessor may terminate the monthly tenancy on 1 month’s notice on the Sub-Lessee,
expiring on any date.

          The Sub-Lessee is not entitled to terminate the monthly tenancy.

          Subject to clause 16.7, the monthly tenancy is on the same terms and conditions as this
Lease.

          The provisions of this clause apply as it if the Lease is terminated without being first
converted to a monthly tenancy.

          Each change that is necessary to make this Lease approximate to a monthly tenancy is
automatic.

          The bond or Bank Guarantee required under this Lease is not be to released or reduced. The
Term and any option to review do not apply,

	 	16.8	 	Instituting Proceedings

	 	(a)	 	The Sub-Lessor is entitled to institute legal proceedings
claiming damages against the Sub-Lessee for the entire Term, including but not
limited to the period:

	 	(i)	 	before and after the Sub-Lessee vacates the
Premises; and
	 
	 	(ii)	 	before and after the abandonment, termination,
repudiation, acceptance or repudiation or surrender by operation of
law.

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	 	(b)	 	The Sub-Lessor is entitled to institute legal proceedings
whether the Lesssor institutes the proceedings before or after the Sub-Lessee’s
action.

	 	16.9	 	Additional Entitlements of Sub-Lessor

          The Sub-Lessor’s entitlement to damages is in addition to:

	 	(a)	 	the entitlement to recover Rent and Outgoings until the date of
expiry or termination of this Lease;
	 
	 	(b)	 	interest on late payments under this Lease; and
	 
	 	(c)	 	costs of a breach or default, including gut not limited to the
costs of termination.

	 	16.10	 	Mitigating Damages when Sub-Lessee Vacates Premises

	 	(a)	 	If the Sub-Lessee vacates the Premises, then the Sub-Lessor
must rake reasonable steps to:

	 	(i)	 	mitigate the damages; and
	 
	 	(ii)	 	endeavour to sub-lease the Premises at a
reasonable rent and on reasonable terms.

	 	(b)	 	the Sub-Lessor’s entitlement to recover Rent and damages for
the period after the Sub-Lessee has vacated the Premises, is assessed on the
basis that eh Sub-Lessor should have observed the obligation to mitigate the
damages.
	 
	 	(c)	 	The Sub-Lessor is not obliged to mitigate the damages arising
because the Premises are not let or lease the Premises; if:

	 	(i)	 	the Sub-Lessee vacates during the last year of
the current lease Term; and
	 
	 	(ii)	 	the Sub-Lessor has a bona fide intention within
6 months after the Sub-Lessee has vacated;

	 	(A)	 	to reconstruct, renovate or
demolish the Premises; or (B) to occupy the Premises.

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	17.	 	Power of attorney by Sub-Lessee to Sub-Lessor

	 	17.1	 	The Sub-Lessee appoints the Sub-Lessor, as the Sub-Lessee’s attorney with the
powers contained in this clause 17, in the event of a default by the Sub-Lessee.
	 
	 	17.2	 	Irrevocable Power

          This power of attorney is:

	 	(a)	 	irrevocable by the Sub-Lessee;
	 
	 	(b)	 	granted by the Sub-Lessee for the valuable consideration of the
grant of this Lease by the Sub-Lessor, to secure:

	 	(i)	 	the performance of the Sub-Lessee’s
obligations; and
	 
	 	(ii)	 	the Sub-Lessor’s proprietary interests over the
Premises.

	 	17.3	 	Extent of Power

	 	(a)	 	The Sub-Lessor as the Sub-Lessee’s attorney and in the name and
on behalf of the Sub-Lessee may

	 	(i)	 	remove from the Premises, then store and sell,
any plant, equipment, chattels an other property that the Sub-Lessee
leaves on the Premises, after the Sub-Lessee has vacated the Premises
and this sub-Lease is terminated or has expired;
	 
	 	(ii)	 	transfer this sub-Lease to an assignee of the
sub-Lease after the Sub-Lessee vacates or abandons the Premises, when
this Lease is not terminated;
	 
	 	(iii)	 	execute any other documents reasonably
required for the transfer;
	 
	 	(iv)	 	surrender this sub-Lease after:

	 	(A)	 	the Sub-Lessor has become
entitled to terminate this Lease; and
	 
	 	(B)	 	the Sub-Lessee vacates or
abandons the Premises or
	 
	 	(C)	 	the Sub-Lessor terminates this
Lease by serving notice of termination.

	 	(v)	 	withdraw a caveat lodged by the Sub-Lessee for
this Lease, after the Sub-Lessor effectively terminates this sub-Lease;
and
	 
	 	(vi)	 	grant one or more sub-leases over the Premises:

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	 	(A)	 	while the Sub-Lessee is the
Sub-Lessee of the Premises; an
	 
	 	(B)	 	after the Sub-Lessee has vacated
or abandoned the Premises in breach of this lease,

	 	(b)	 	The Sub-Lessor may grant a sublease:

	 	(i)	 	over the Premises;
	 
	 	(ii)	 	limit to the duration of the then existing Term
of this sub—Lease; and
	 
	 	(iii)	 	at a reasonable rent, considering;

	 	(A)	 	the current market rental value
of the Premises sublet; and
	 
	 	(B)	 	the duration and the conditions
of the sub-lease.

	 	17.4	 	Duration of Power of Attorney

          The Sub-Lessor may:

	 	(a)	 	act as attorney during the continuance of this sub-Lease and
the period of the number of months in Item11 of the Reference Schedule after
the termination of this sub-Lease;
	 
	 	(b)	 	register this sub-Lease or lease provisions as a power of
attorney, at any time including after the termination of this sub-Lease, if
that is required for the exercise of a power; and
	 
	 	(c)	 	ratify and confirm a power, as attorney and agent for the
Sub-Lessee.

	18.	 	Costs, charges and expenses

          In connection with this sub-Lease and any document related to it, the Sub-Lessee must pay
promptly;

	 	(a)	 	for everything it must do;
	 
	 	(b)	 	all stamp duty and registration fees;
	 
	 	(c)	 	on demand, the Sub-Lessor’s reasonable costs, charges and
expenses, including but not limited those for negotiating, preparing,
executing, stamping registering, obtaining a consent the Sub-Lessor must obtain
before giving approval, considering a request for an approval and exercising
right; and

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	 	(d)	 	all costs, charges and expenses for work the Sub-Lessee carries
out or wants to carry out including but not limited to costs, charges and
expenses that the Sub-Lessor incurs

	 	(i)	 	in considering approving and supervising the
works, and
	 
	 	(ii)	 	modifying or varying the Premises because of
the works.

	19.	 	Notices

	 	(a)	 	A notice approval, consent or other communication to a person
for this sub-Lease must be:

	 	(i)	 	in legible writing;
	 
	 	(ii)	 	in English; and
	 
	 	(iii)	 	left at the address or sent to the facsimile
number of the party in item 8, as varied by notice.

	 	(b)	 	If the notice is from a corporation then:

	 	(i)	 	an officer of that corporation must sign the
notice; or
	 
	 	(ii)	 	the corporation must fix its common seal to the
notice.

	 	(c)	 	Notice is sent by the sender and received by the receiver.

	 
	 	(i)	 	if the notice is hand delivered, upon delivery
to the receiving party; 
	 
	 	(ii)	 	if the notice is sent by registered mail within
Australia, 2 Business Days after registration of the notice of pGSTing;
	 
	 	(iii)	 	if the notice is sent by registered mail
within Australia 2 Business Days from and including the date of
pGSTage; and
	 
	 	(iv)	 	if the notice is sent by ordinary mail within
Australia 3 Business Days from and including the date of pGSTage; and
	 
	 	(v)	 	if the notice is sent to or from overseas by
air mail 7 Business Days from and including the date of pGSTing.

	 	(d)	 	In clause 19(c) a reference to a person receiving a notice
includes a reference to the receiver’s officers, agents or employees.

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	20.	 	Bank Guarantee

	 	(a)	 	On or before the commencing Date, the Sub-Lessee must deliver
the Bank Guarantee to the Sub-Lessor.
	 
	 	(b)	 	The Bank Guarantee is security for the Sub-Lessee’s performance
under this lease.
	 
	 	(c)	 	If the Sub-Lessee does not comply with any of its obligations
under this Lease then the Sub-Lessor may call on the Bank Guarantee without
notice to the Sub-Lessee.
	 
	 	(d)	 	The Sub-Lessor may call on the Bank Guarantee whether this
Lease is registered or not.
	 
	 	(e)	 	If the Sub-Lessor calls on the Bank Guarantee or the Rent is
increased, then no later than 7 days after the Sub-Lessor gives the Sub-Lessee
a notice asking for it, the Sub-Lessee must deliver to the Sub-Lessor a
replacement or additional Bank Guarantee to that the amount of that guarantee
is the amount in Item 9 in the Reference Schedule.
	 
	 	(f)	 	The Sub-Lessee’ obligations under this clause 20 are essential
terms of this sublease.
	 
	 	(g)	 	The Sub-Lessor must return the Bank Guarantee to the Sub-Lessee
as soon as practicable after the Terminating Date or determination of the
Lease, if the Sub-Lessee has (in the opinion of the Sub-Lessor) satisfied all
of its obligations under the sub-Lease.

	21.	 	Guarantee and Indemnity

	 	21.1	 	Guarantor

          Clause intentionally omitted

	22.	 	Option for a new lease

	 	22.1	 	Grant of Option

          The Sub-Lessor must grant a new lease under this clause 22 on the Terminating Date to commence
on the next day only if:

	 	(a)	 	the Sub-Lessee gives the Sub-Lessor a notice stating that it
wants a new lease of the Premises for the term first specified in Item 11 of
the Reference Schedule;

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	 	(b)	 	the Sub-Lessor receives that notice within the period beginning
on the day that is nine months before the Terminating Date and ending on the
day that is six months before the Terminating Date;
	 
	 	(c)	 	from the time the Sub-Lessee gives that notice until the
Terminating Date the Sub-Lessee is either not in breach of this lease or the
Sub-Lessor has waived the breach in writing; and
	 
	 	(d)	 	the Sub-Lessee delivers to the Sub-Lessor before the
Termination Date a guarantee or a guarantee and indemnity for the Sub-Lessee’s
obligations under the new lease.

	23.	 	Terms of new lease

          The parties must ensure that the new sub-lease is on terms similar to this Lease except that:

	 	(a)	 	If particulars of more than one new sub-lease are specified in
Item 11 of the Reference Schedule, then the parties must delete from Item 11 of
the Reference Schedule, the particulars of the new sub-lease first specified in
that item;
	 
	 	(b)	 	If the particulars of the new sub-lease are the only
particulars specified in Item 11, then the parties must delete this clause 23
and Item 11 in the Reference Schedule;
	 
	 	(c)	 	The term, the commencing date, the terminating date, the rent
review dates and the redecoration requirements and dates are those first
specified in Item 11;
	 
	 	(d)	 	The relevant items of the Reference Schedule in the new
sub-lease are amended accordingly;
	 
	 	(e)	 	The rent of the new sub-lease under clause 22 will increase by
CPI on the anniversary of the commencement date of the new sub-lease each and
ever year and the amount in “Y” in the formula in Schedule 1 shall be the
amount of the GST exclusive Commencing Rent;
	 
	 	(f)	 	The parties must ensure that the variations to this lease which
become effective during the Term are in the new Lease.
	 
	 	(g)	 	The initial rent for the first year of the new sub-lease shall
be determined in accordance with Schedule 2.

	24.	 	Dispute resolution

          (a) If there is a dispute between the parties then either party may give a notice to the
other.

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	 	(b)	 	The notice must:

	 	(i)	 	succinctly set out the details of the dispute; and
	 
	 	(ii)	 	state that it is a dispute notice given under this clause 24.

	 	24.1	 	Notice in response

	 	(a)	 	Within 10 Business Days after the delivery of the dispute
notice, the recipient must deliver to the other party a notice in response.
	 
	 	(b)	 	The notice in response must:

	 	(i)	 	acknowledge the party’s receipt of the dispute
notice;
	 
	 	(ii)	 	state that it is a notice given under this
clause 24; and
	 
	 	(iii)	 	succinctly set out any information it believes
is directly relevant to the dispute.

	 	24.2	 	Initial Meeting

	 	(a)	 	The parties must meeting within 10 Business Days after the date
of delivery of the dispute notice attempt to resolve the dispute.
	 
	 	(b)	 	Each party must use its best endeavours and act in good faith.

	 	24.3	 	Escalation

	 	(a)	 	If the parties cannot solve the dispute within 20 Business Days
of the date on which the dispute notice is delivered, then the parties must
each escalate the dispute to their chief executive officer.
	 
	 	(b)	 	Each party must provide its chief executive officer with the
copy of:

	 	(i)	 	the dispute notice;
	 
	 	(ii)	 	the notice in response; and
	 
	 	(iii)	 	a succinct account of any subsequent meetings
or correspondence between the parties.

	 	24.4	 	Refer to a mediator

	 	(a)	 	If the chief executive officer cannot solve the dispute within
20 Business Days of the date on which the dispute is delivered, then either of
the chief executive officers may refer the dispute to the Australian Commercial
Disputes Centre Limited or another mediator agreed between the parties.

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	 	(b)	 	The parties must ensure that the mediation in conducted under
the rules of the Australian Commercial Disputes Centre.

	 	24.5	 	Agreement remains in force

          Each party must continue to perform its obligations under this agreement pending resolution of
the dispute.

	 	24.6	 	Referral to arbitration

          If the parties cannot resolve the dispute within 20 Business Days after the referral to the
mediator, then either party may refer to the dispute to arbitration.

	25.	 	General

	 	25.1	 	Waiver and Variation

	 	(a)	 	The parties may only waive or vary a provision of or a right
under this sub-Lease if the person who is bound first given written consent.
	 
	 	(b)	 	The Sub-Lessor does not waiver any breach or rights under this
sub-Lease if it:

	 	(i)	 	accepts rent or other money under this sub-Lease, before or after termination;
	 
	 	(ii)	 	fails to exercise or delays exercising a right under this lease;
	 
	 	(iii)	 	gives a concession or indulgence to the Sub-Lessee; or
	 
	 	(iv)	 	attempts to mitigate its loss.

	 	(c)	 	The Sub-Lessor’s attempt to mitigate its loss is not a
surrender of this sub-lease.

	 	25.2	 	Exclusion of Statutory Provisions

	 	(a)	 	the covenants, powers and provisions implied in leases by
sections 84, 84A, 85 and 86 of the Conveyancing Act 1919 do not apply to this
sub-Lease.
	 
	 	(b)	 	In this sub-Lease words are used in any of the forms of words
in the first column of Part 2 of the Schedule 4 to the Conveyancing Act 1919 do
not imply a covenant under section 86 of that Act.

	 	25.3	 	Prior Breaches

             The expiry or termination of this sub-Lease does not affect a right arising from a breach of
this sub-Lease before expiry or termination.

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	 	25.4	 	Warranties and Undertakings

	 	(a)	 	The Sub-Lessee warrants that it:

	 	(i)	 	has relied only on its own inquiries about this
sub-Lease;
	 
	 	(ii)	 	has not relied on any representation or
warranty by the Sub-Lessor or any persons acting or seeming to act on
the Sub-Lessor’s behalf; and
	 
	 	(iii)	 	was made aware of the Rules and Regulations
current when signing this sub-Lease.

	 	(b)	 	The Sub-Lessee must comply on time with undertakings given by
or on behalf of the sub-Lessee.

	 	25.5	 	Severability

	 	(a)	 	If the whole or any part of a provision of this Lease is void,
unenforceable or illegal in a jurisdiction, it is severed from that
jurisdiction.
	 
	 	(b)	 	The remainder of this sub-Lease has full force and effect and
the validity or enforceability of that provision in any jurisdiction is not
affected.

	 	25.6	 	No merger

	 	(a)	 	Nothing in this sub-Lease mergers, postpones, extinguishes
lessens or otherwise prejudicially affects the right and remedies of the
parties under this sub-Lease or under any other agreement.
	 
	 	(b)	 	This sub-Lease and any other agreement continue in full force
and effect.

	 	25.7	 	Entire Agreement

	 	(a)	 	This sub-Lease embodies the entire agreement between the
parties.
	 
	 	(b)	 	This agreement supersedes all previous agreements.

	 	25.8	 	Counterparts

	 	(a)	 	A party may execute this sub-Lease by signing any counterpart.
	 
	 	(b)	 	All counterparts constitute one document when taken together.

	 	25.9	 	Cumulative rights

          A right power, discretion and remedy arising out of this sub-Lease in favour of Sub-Lessor:

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	 	(a)	 	is cumulative; and
	 
	 	(b)	 	does not diminish any other right, power, discretion and remedy
of Sub-Lessor.

	 	25.10	 	Exclusion of Moratorium

	 	(a)	 	To the extent not excluded by law, any legislation is negatived
and excluded if the legislation at any time directly or indirectly;

	 	(i)	 	stays postpones or otherwise prejudicially
affects or prevents the exercise by the Sub-Lessor of its rights, or
remedies or
	 
	 	(ii)	 	varies or affects in favour of the Sub-Lessee,
an obligation under this sub-Lease.

	 	(b)	 	Any protection or relief under this legislation is negatived
and excluded.

	 	25.11	 	Relationship of Sub-Lessor and Sub-Lessee

             Nothing contained or implied in this sub-Lease will be deemed or construed to create the
relationship of partnership or of principal and agent or of joint venture between the Sub-Lessor
and the Sub-Lessee. Specifically, the parties understand and agree that neither the method of
computation of rent, nor any other provision, nor any acts of the Sub-Lessee and the Sub-Lessor or
either of them will be deemed to create any relationship between them other than the relationship
of Sub-Lessor and Sub-Lessee upon the terms and conditions only as provided in this sub-Lease.

	26.	 	Sublessor Obligations

	 	(i)	 	The Sublessor covenants with the Sublessee to
act, with reference to the Sublessee, in respect of the Head Lease and
the Head Lessor, as is provided in this clause.
	 
	 	(ii)	 	The Sublessor covenants to pay the rent and
outgoings due under the Head Lease and to comply with the Head Lessee’s
obligations under the Head Lease.
	 
	 	(iii)	 	The Sublessor shall use its reasonable
endeavours to enforce the covenants and obligations of the Head Lessor
under the Head Lease, if requested by the Sublessee, to the extent that
they may effect the Sublessee’s use and occupation of the leased
premises.
	 
	 	(iv)	 	The Sublessor shall use its reasonable
endeavours and act honestly, reasonable and promptly to procure the
consent of the Head Lessor when the consent is required by the
Sublessee.

Page 41 of 46

 

	 	(v)	 	The Sublessor shall forward to the Sublessee,
within seven days after receipt of notices of correspondence from the
Head Lessor or from any local government or statutory authority
relating to breaches of the Head Lease or requiring any work to be done
or relating to use or occupation of the leased premises, copies of such
notices or correspondence.
	 
	 	(vi)	 	The Sublessor covenants not to permit this
Subleases and the Sublessee’s estate to be terminated due to the
termination of the Head Leases as a result of the Sublessor’s breach,
default or repudiation under the Head Lease.
	 
	 	(vii)	 	During the term of this sub lease, or any
period which the sub lease relates to, the Sublessor covenants to
exercise any options to renew it’s head lease of the Premises.

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SCHEDULE I

INDEX OF REVIEW OF RENT

     At and from each Index Rent Review Date the parties must calculate the Rent using the
following formula:

               

Where for the purpose of this clause:

X = the Rent for the year commencing with the relevant Index Rent Review Date;

Y = the Rent for the first year of the Term (being $                    ) for the purpose of this Schedule
1);

A = the Index Number for the quarter immediately before the Relevant Index Rent Review Date; and

B = the Index Number for the quarter immediately before the Commencing Date.

Page 43 of 46

 

SCHEDULE 2

     On the Market Review DateS, the annual base rent which is payable under this Lease must be
varied in accordance with the following;

     a. Between the periods of twelve months prior to the Review Date of the Lease and no later
than one month prior to the Review Date the Lease, the Lessor may notify the Lessee of the amount
that the Lessor reasonably considers will be the current market rent payable by the Lessee for the
leased premises at the Market Review Date.

     b. If the Lessor notifies the Lessee later than the one month allowed under clause (a) above,
the notice will be effective and the reviewed rent will be payable from the next day on which rent
is next due after the expiration of one month from notice to the Lessee from the Lessor of the
amount payable.

     c. If the Lessee disputes the amount of rent notified1 the Lessee must notify the Lessor in
writing of the dispute within 14 days after receiving the notification. The Lessee must comply
with this time limit to dispute the notified amount.

     d. If the Lessee notifies the Lessor of a dispute, the current market rent of the leased
premises will be decided by valuation as follows;

          i. The Lessor and the Lessee may each appoint a valuer and notify the other of the valuer
appointed.

          ii. When a party who has not appointed a valuer receives notice of the other party’s
appointment, it must appoint its own valuer and notify the other of the valuer appointed, within 14
days of receiving notice.

          iii. If only one party has appointed and notified its valuer to the other party and 14 days
has expired since the notification, that valuer alone will decide the current market rent and the
amount determined by the valuer will be the reviewed annual rent payable. The costs of the valuer
will be borne equally between the parties.

          iv. If both parties have appointed valuers and the valuers have agreed upon the current market
rent within 21 days of the date on which the last appointed valuer is notified to the other party,
the amount agreed upon will be the reviewed annual rent and the parties will each be exclusively
liable for the costs of the valuer appointed by them.

          v. Where both parties have appointed valuers and the valuers have not agreed about the current
market rent within the time set out in clause 6(2)(d)iv, either or both of the Lessor and Lessee
may request the President of the Real Estate Institute of New South Wales to decide the current
market rent, which will then become the reviewed annual rent. The nominated valuer must give both
the Lessor and the Lessee a reasonable opportunity to make submissions about the matter and in
deciding the current market rent will act as an expert and not as an arbitrator. The costs of this
valuation will be borne equally between the parties.

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          vi. For the purposes of this clause the valuers appointed by the Lessor and the Lessee will
have failed to agree upon the current market rent if either of them has not or both of them have
not agreed about the rent within the time limit described in clause (iv) above or, before reaching
agreement about the rent within the time limit, either of them dies, becomes, incapable of acting
or refuses to act.

          vii. In deciding the current market rent, the valuers must have regard to open market rents
current at or about the review date and are to assume that, at the review date the leased premises
are vacant and ready for immediate occupation, the leased premises are available to be let without
a premium by a willing lessor to a willing lessee on the terms of the lease (except the amount of
rent) for a term equal to the original term of the lease together with any options for renewal
which remain to be exercised at the review date.

          viii. In deciding the current market rent, the valuers must disregard the fact that the lessee
is in occuption of the leased premises, the value of the goodwill of the Lessee’s business, and any
improvements to the Leased premises made by the Lessee or the Lessee’s predecessors in title during
the Lease term or, if the Lease was granted following the exercise of an option for renewal, during
the terms of the original Lease and of each successible lease resulting from the exercise of an
option for renewal, during the terms of the original lease and of each successive Lease resulting
from the exercise of an option for renewal in the immediately preceding Lease. Until the any
review by an independent valuer is complete, the Lessee must pay rent at the varied current market
rent rate notified by the Lessor as referred to in clause (a) herein. When the review is complete,
any necessary adjustment is to be made on the day on which rent is next due.

Page 45 of 46

 

ANNEXURE B

PLAN OF PREMISES

Page 46 of 46

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