Document:

exv10w14

 

EXHIBIT 10.14

THIS LEASE AMENDMENT AND CONSENT made as of the 26th day of November, 2003.

BETWEEN:

ACHESON PROPERTIES LTD.

(the “Landlord”)

— and —

NORTH AMERICAN CONSTRUCTION GROUP INC.

(the “Tenant”)

LEASE AMENDMENT AND CONSENT AGREEMENT (SPRUCE GROVE)

WHEREAS:

	A.	 	NAR Group Holdings Ltd. and the Tenant executed a lease agreement dated December 1, 1997,
for a term expiring November 30, 2002, a copy of which is attached as Schedule “A” hereto (the
“Lease”);
	 
	B.	 	The rights of NAR Group Holdings Ltd. under the Lease became vested in Norama Inc. by
virtue of a reorganization and amalgamation which occurred on April 1, 1998;
	 
	C.	 	Norama Inc. and the Tenant executed a renewal agreement dated December 1, 2002, a copy of
which is attached as Schedule “B” hereto (the “Renewal Agreement”), wherein the term of the Lease
was renewed for a further term of five (5) years, commencing December 1, 2002 and ending November
30, 2007 (the “Renewal Term”);
	 
	D.	 	The rights of Norama Inc. under the Lease and the Renewal Agreement became vested in the
Landlord by virtue of a rollover agreement and reorganization of the holdings of Norama Inc. which
occurred on April 1, 2003;
	 
	E.	 	The Landlord and the Tenant wish to amend the terms of the
Lease (as amended by the
Renewal Agreement) (the “Renewed Lease”) on the terms contained herein.

NOW THEREFORE THIS AGREEMENT WITNESSETH THAT in consideration of the rents, covenants and
agreements contained in this Agreement and the Renewed Lease and in consideration of the sum of ONE
($1.00) DOLLAR now paid by the Tenant to the Landlord, the parties agree as follows:

	1.	 	The Renewed Lease shall be amended by adding the following terms:

“(a) OPTION TO RENEW:

If the Tenant duly and regularly pays Minimum Rent (as defined in this Lease, as amended) and is
not currently in default under any of the covenants, conditions,

 

 

provisions and agreements contained in this Lease (as amended) on the part of the Tenant to be paid
and performed, the Tenant shall have the option to renew this Lease for a term of five (5) years
from the expiry of the Term (the “First Renewal Term”) exercisable by notice to the Landlord, as
specified in this Lease (as amended), at least six (6) months prior to the expiration of the Term,
upon the terms and conditions contained in this Lease (as amended) excepting any clause giving the
Tenant an option to renew this Lease (as amended) save and except for (b) below and excepting also
the amount of Minimum Rent, which shall be an amount equivalent to the Minimum Rent reserved under
this Lease (as amended) multiplied by the Consumer Price Index for the base year 2007 for the City
of Edmonton published by Statistics Canada, and which shall in no event be less than the Minimum
Rent reserved under this Lease (as amended).

(b) OPTION TO RENEW:

If the Tenant duly and regularly pays Minimum Rent (as defined in this Lease, as amended) and is
not currently in default under any of the covenants, conditions, provisions and agreements
contained in this Lease (as amended), on the part of the Tenant to be paid and performed, the Tenant
shall have the option to renew this Lease for a second term of five (5) years from the expiry of
the Renewal Term (the “Second Renewal Term”) exercisable by notice to the Landlord, as specified in
this Lease (as amended) at least six (6) months prior to the expiration of the Renewal Term, upon
the terms and conditions contained in this Lease (as amended) excepting any clause giving the
Tenant an option to renew this Lease (as amended) and excepting also the amount of Minimum Rent,
which shall be an amount equivalent to the Minimum Rent reserved under this Lease (as amended)
multiplied by the increase in the Consumer Price Index for 2012 over the base year 2007 for the
City of Edmonton published by Statistics Canada, and which shall in no event be less than the
Minimum Rent reserved under this Lease (as amended),”

	2.	 	CONSENT

	 	(a)	 	The Landlord consents to:

	 	(i)	 	the sale and transfer of all of the issued and outstanding shares of the Tenant by the
shareholder of the Tenant to NACG Acquisition Inc. (“Acquisition”) and NACG Preferred Corp.
effective on or about November 26th, 2003 (the “Transfer Date”);
	 
	 	(ii)	 	the amalgamation of the Tenant and Acquisition effective on or shortly after the Transfer Date
to form North American Construction Group Inc. (“NACGl”);
	 
	 	(iii)	 	the assignment and transfer to Acquisition, or its successor NACGI, of the right, title
and interest of the Tenant in, to and under each of the Renewed Lease and this Agreement on and
after the Transfer Date;
	 
	 	(iv)	 	the charge, mortgage, assignment and transfer (by way of mortgage or security only) of the
rights title and interest of Acquisition, or its successor

 

 

	 	 	 	NACGI, under the Renewed Lease in favour of Acquisition’s or NACGI’s secured creditors including
the Royal Bank of Canada; and
	 
	 	(v)	 	the assumption by Acquisition, or its successor NACGI, of the indebtedness, liabilities and
obligations of the Tenant arising under each of the Renewed Lease and this Agreement after the
Transfer Date.

	 	(b)	 	Nothing contained in this Agreement shall be construed as a release or discharge of the Tenant
from its indebtedness, liabilities and obligations under any of the Renewed Lease or this Agreement
or any guarantees of such indebtedness, liabilities or obligations, up to the Transfer Date.
	 
	 	(c)	 	Nothing contained in this Agreement shall be construed as a consent to any further assignment
or transfer of the rights, title or interest of Acquisition, or its successor NACGI, under any of
the Renewed Lease or this Agreement to any other party or as a consent to any further assumption of
the indebtedness, liabilities or obligations of Acquisition, or its successor NACGI, under any of
the Renewed Lease or this Agreement by any other party. No further assignment or transfer of the
rights, title or interest of NACGI under the Lease, the Renewal Lease or this Agreement can be made
without obtaining the prior written consent of the Landlord, such consent not to be unreasonably
withheld.
	 
	 	(d)	 	The Landlord shall, upon the reasonable request of Acquisition, or its successor NACGI, and at
the expense of Acquisition, or its successor NACGI, execute any further documents and take any
further actions as may be reasonably required by Acquisition, or its successor NACGI, in order to
further evidence or give further effect to this Agreement.

	3.	 	Paragraphs 1.1 (i) and (ii) shall be deleted and replaced with the following:

	 	(a)	 	(i)     Landlord: Acheson Properties Ltd.

	 	(ii)	 	Address and Facsimile No. of Landlord:

c/o Fraser Milner Casgrain LLP

#2900, 10180—101 Street

Edmonton, Alberta T5J 3V5

	4.	 	Article 17.7 of the Lease shall be deleted in its entirety and replaced with following:

	 	17.7	 	Registration

     The Tenant may, at its sole expense, register a caveat or notice in respect of this Lease, as
amended, against title to the Premises which caveat shall disclose only the existence and Term of
this Lease but in any event the caveat shall not disclose any financial terras of this Lease. The
Tenant hereby covenants to discharge and withdraw the caveat from any certificate of title
pertaining to. the Premises within 30 days of the expiration of the Term or the earlier
termination of this Lease.

 

 

	5.	 	The Lease is amended by adding the following provisions:

	 	17.18	 	Status Certificate

     The Landlord shall at any time and from time to time upon not less than fifteen (15) days’ prior
notice from the Tenant or the Tenant’s lender, including the Royal Bank of Canada or any successor
lender or other lender (the “Lender”), execute and deliver to the Tenant and the Lender a statement
in writing certifying that this Lease is in full force and effect or, if modified, stating the
modifications and that this Lease is in full force and effect as modified, the amount of Minimum
Rent and Additional Rent then being paid hereunder, the dates to which the Minimum Rent, Additional
Rent and other charges hereunder have been paid, by installments or otherwise, and whether or not
there is any default on the part of the Tenant of which the Landlord has knowledge.

	 	17.19	 	Notice to Lender

     The Landlord agrees to deliver to the Lender a copy of any written notice which is sent by the
Landlord to the Tenant dealing with any default or alleged default by the Tenant under this Lease
which is material. For the purposes of this Lease, the Lender’s address for notices is:

Royal Bank of Canada, as Administrative Agent

P.O. Box 50, 200 Bay Street

Royal Bank Plaza

12th Floor, South Tower

Toronto, Ontario M5J 2W7

Attention: Manager, Agency

                  Agency Services Group

Fax:            (416) 842-4023

	 	 	The Landlord further agrees that the Lender, at its option,
shall have the right to remedy the
default within the time period for remedying the default set out in this Lease prior to the
exercise by the Landlord of any of the Landlord’s rights under the Lease. If, pursuant to its
security or otherwise, the Lender takes possession of the Premises, the Landlord agrees to permit
the Lender to remain in possession of the Premises provided that the Lender agrees to perform the
Tenant’s obligations under this Lease and agrees in writing with the Landlord to be bound by all
the terms and conditions of this Lease.
	 
	6.	 	Schedule “B” to the Lease is hereby deleted in its entirety and replaced with Schedule “C”
attached to this Agreement.
	 
	7.	 	Except to the extent of the amendments contained herein, the Landlord and the Tenant covenant
that they shall perform and observe the covenants, provisos and stipulations in each of the Renewed
Lease and this Agreement as fully as if such covenants, provisos and stipulations had been repeated
in this Agreement in full, with such modifications only as are necessary to make them applicable to
this Agreement, provided, however, that if the Renewal Term is determined by the Landlord pursuant
to any right vested in the Landlord in either of the Lease or the Renewal Agreement, the options to
renew granted

 

 

	 	 	by this Agreement shall not commence and the right of the Tenant under this Agreement shall be
void.
	 
	8.	 	A telecopy of fax copy of an executed copy of this Agreement shall have the same force
and effect as an originally executed copy of this Agreement.
	 
	9.	 	This Agreement shall enure to the benefit of and be binding upon each of the parties and
their respective successors and permitted assigns.

IN WITNESS WHEREOF this Agreement has been executed by the parties as of the date first above
written.

	 	 	 	 	 	 	 
	 	 	ACHESON PROPERTIES LTD.	 	 
	 
	 	 	 	 	 	 
	 

	 	PER:
	 	/s/ [ILLEGIBLE]
 

	 	 
	 
	 	 	 	 	 	 
	 	 	NORTH AMERICAN
CONSTRUCTION GROUP INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	PER:
	 	/s/ [ILLEGIBLE]
 

	 	 

 

 

SCHEDULE “A” TO THE

LEASE AMENDMENT AND CONSENT AGREEMENT

BETWEEN

ACHESON PROPERTIES LTD.

AND

NORTH AMERICAN CONSTRUCTION GROUP INC.

Lease of Spruce Grove Premises

 

 

SCHEDULE
“A”

DEFINITIONS

          In this Lease, the following words, phrases and expressions are used with the meanings
defined as follows:

1. Additional Rent means any sum or sums other than Minimum Rent payable by the Tenant to the
Landlord pursuant to any provision of the Lease, all of which are recoverable by the Landlord
as rent.

2.
Business Day means a day that is not a Saturday, Sunday or statutory holiday in Alberta.

3. Commencement Date means the date set out in Section l.l(e)(ii).

4. Environmental Laws mean all international, federal, provincial or municipal laws, by-laws,
statutes, regulations, orders, permits, approvals or judgments having jurisdiction over the
Landlord, the Tenant or the Premises and relating in any way to the environment or health
matters including without limitation matters relating to the use, storage and disposal of
Hazardous Substances or the release of any substance into the environment.

5. Hazardous Substance means any substance, product, material or good which may be
detrimental to the environment, plant or animal life, or human health or which may adversely
affect the condition, use or enjoyment of any real or personal property and includes, but is
not limited to any substance, product, material or good declared to be hazardous or toxic
pursuant to any Environmental Law.

6. Landlord means the party or parties described in Section l.l(a) and the heirs, executors,
administrators, successors and assignees thereof.

7. Lease Year means, in the case of the first Lease Year, the period beginning on the
Commencement Date and terminating twelve (12) months from the last day of the calendar month
in which the Commencement Date occurs (except that if the Commencement Date occurs on the
first day of a calendar month, the first Lease Year shall terminate on the day prior to the
first anniversary of the Commencement Date) and, in the case of each subsequent Lease Year,
means each twelve (12).month period after the first Lease Year.

8. Minimum Rent means the rent set out in Section l.l(f).

9. Parking Areas means the paved portions of the Premises which have been or are to be allocated
for the parking of motor vehicles, as from time to time altered, reconstructed or expanded,
and includes entrances, roads and other means of access thereto and any parking structures
or other parking facilities from time to time constructed.

10. Premises means the lands described in Section l.l(d) and all structures and improvements
from time to time erected thereon and their appurtenances, all as the same may be expanded or
altered in accordance with this Lease from time to time.

11. Property Taxes means all general, special, local improvement, school and water taxes,
levies, rates and charges from time to time imposed against the Premises, or any part thereof,
by municipal or other governmental authorities having jurisdiction, together with the costs of
contesting or negotiating the same, but exclusive of income taxes, business taxes, place of
business taxes, estate; inheritance, succession, capital levy or transfer tax. (Should it be
found that due to changes in the method of levying or collection of any tax, levy, rate or
charge to be imposed upon the Premises, or any part thereof, or should any new tax, levy,
rate or charge be levied or imposed in lieu of or in addition to those contemplated by the
above definition, the Landlord and the Tenant hereby agree to negotiate an amendment or new
provision to this Lease as is necessary to deal with such tax, levy, rate or charge, in an

 

 

 - 2 - 

upon the
Premises, or any part thereof, or should any new tax, levy; rate or charge be levied
or imposed in lieu of or in addition to those contemplated by the above definition, the
Landlord and the Tenant hereby agree to negotiate an amendment or new provision to this Lease
as is necessary to deal with such tax, levy, rate or charge, in an equitable manner so as
to obviate any injustice or inequity which shall have arisen and
should the Landlord and the
Tenant fail to agree on such amendment or new provision the same
shall be settled by
arbitration in accordance with the Arbitration Act of the jurisdiction governing this Lease,
and amendments thereto, or any like statute in effect from time to time).

12. Sales Tax means any Goods and Services Tax, sales tax, business transfer tax, value added tax
or any similar tax imposed against the Landlord or the Tenant by the Government of Canada, or any
provincial or municipal government, to the extent that such tax is imposed against the Landlord or
the Tenant or is required to be paid or collected by the Landlord by reason of any payment by the
Tenant to the Landlord pursuant to any provision of this Lease.

13. Security Deposit means the sum of money specified in Section l.l(g), to be held by the Landlord
in accordance with the terms of this Lease:

14. Security Interest means an interest in goods, chattel paper, a security, a document of title,
an instrument, money or an intangible, that secures payment or performance of an obligation as
more specifically defined in the Personal Property Security Act of Alberta, any amendments there
or replacement thereof.

15. Structural Repairs means only repairs to the foundations, the structural subfloors, columns,
beams and the structural portions of bearing walls and roofs of the Premises and excludes maintenance of
every kind.

16. Substantial Damage or Destruction means such damage as, in the opinion of the Landlord’s
architect, requires substantial alteration or reconstruction of the Premises as cannot be repaired
within a period of one hundred and eighty (180) days from the time of such damage to the state
wherein the Tenant could use substantially all of the Premises for its business.

17. Tenant means the party or parties described in Section l.l(b) and the heirs, executors,
administrators, successors and permitted assignees thereof.

 

 

SCHEDULE “A”

LEASE

LANDLORD: NAR GROUP HOLDINGS LTD.

TENANT: NORTH AMERICAN CONSTRUCTION GROUP INC.

Dated: December 1,1997

 

 

TABLE
OF CONTENTS

	 	 	 	 	 
	ARTICLE 1
— BASIC TERMS, SCHEDULE, DEFINITIONS
	 	 	1	 
	1.1 Basic Terms 
	 	 	1	 
	1.2 Schedule 
	 	 	2	 
	1.3 Definitions 
	 	 	2	 
	 
	 	 	 	 
	ARTICLE 2 — GRANT OF LEASE
	 	 	2	 
	2.1 Demise 
	 	 	2	 
	 
	 	 	 	 
	ARTICLE 3 — TERM, COMMENCEMENT, RENEWAL
	 	 	2	 
	3.1 Term 
	 	 	2	 
	3.2 Commencement Date 
	 	 	2	 
	3.3 Option to Renew
	 	 	2	 
	 
	 	 	 	 
	ARTICLE 4 — RENT 
	 	 	2	 
	4.1 Minimum Rent 
	 	 	2	 
	4.2 Payment of Minimum Rent 
	 	 	2	 
	4.3 Pro Rata Adjustment of Rent
	 	 	3	 
	4.4 Payments Generally 
	 	 	3	 
	4.5 Security Deposit
	 	 	3	 
	 
	 	 	 	 
	ARTICLE 5 — ADDITIONAL RENT 
	 	 	4	 
	5.1 Intent of Lease 
	 	 	4	 
	5.2 Additional Rent 
	 	 	4	 
	5.3 Estimate of Additional Rent 
	 	 	4	 
	5.4 Payment of Additional Rent 
	 	 	4	 
	5.5 Adjustment of Additional Rent
	 	 	4	 
	5.6 Pro Rata Adjustment of Additional Rent
	 	 	5	 
	5.7 Review of Additional Rent 
	 	 	5	 
	 
	 	 	 	 
	ARTICLE 6 — TAXES 
	 	 	5	 
	6.1 Tenant’s Taxes 
	 	 	5	 
	6.2 Payment of Property Taxes 
	 	 	5	 
	6.3 Sales Tax 
	 	 	5	 
	 
	 	 	 	 
	ARTICLE 7
— UTILITIES AND SERVICES
	 	 	5	 
	7.1 Tenant’s Utilities and Services
	 	 	5	 
	 
	 	 	 	 
	ARTICLE 8 — INSURANCE 
	 	 	5	 
	8.1 Tenant’s Insurance 
	 	 	5	 
	8.2 Landlord’s Insurance 
	 	 	7	 
	8.3 Increases in Rates 
	 	 	7	 
	8.4 Recovery of Landlord’s Premiums
	 	 	7	 
	 
	 	 	 	 
	ARTICLE 9 — USE AND OCCUPATION 
	 	 	7	 
	9.1 Quiet Enjoyment
	 	 	7	 
	9.2 Use 
	 	 	7	 
	9.3 Covenant to Operate
	 	 	7	 
	9:4 Signs 
	 	 	8	 
	9.5 Compliance with Laws
	 	 	8	 
	9.6 Nuisance 
	 	 	8	 

 

 

ii

	 	 	 	 	 
	ARTICLE 10 — HAZARDOUS SUBSTANCES ON THE PREMISES
	 	 	8	 
	10.1 Hazardous Substances 
	 	 	8	 
	10.2 Reporting Requirements 
	 	 	8	 
	10.3 Compliance with Environmental Laws
	 	 	8	 
	10.4 Clean Up or Removal
	 	 	9	 
	10.5 Indemnity 
	 	 	9	 
	10.6 Ownership of Hazardous Substances
	 	 	10	 
	 
	 	 	 	 
	ARTICLE 11 — CLEANING, REPAIR 
	 	 	9	 
	11.1 Cleaning 
	 	 	9	 
	11.2 Tenant’s Repairs 
	 	 	10	 
	11.3 View Repairs 
	 	 	10	 
	11.4 Landlord may Maintain and Repair 
	 	 	10	 
	11.5 Landlord’s Repairs 
	 	 	10	 
	11.6 Taking of Possession 
	 	 	11	 
	 
	 	 	 	 
	ARTICLE 12 — ALTERATIONS, FIXTURES 
	 	 	11	 
	12.1 Tenant’s Alterations 
	 	 	11	 
	12.2 Removal of Fixtures
	 	 	11	 
	 
	 	 	 	 
	ARTICLE 13 — SUBSTANTIAL DAMAGE AND DESTRUCTION, EXPROPRIATION
	 	 	12	 
	13.1 No Abatement
	 	 	12	 
	13.2 Substantial Damage or Destruction 
	 	 	12	 
	13.3 Rebuilding 
	 	 	12	 
	13.4 Expropriation
	 	 	12	 
	 
	 	 	 	 
	ARTICLE 14 — ASSIGNMENT, SUBLETTING, SALE OR MORTGAGE
	 	 	13	 
	14.1 Assignment and Subletting 
	 	 	13	 
	14.2 Bulk Sale
	 	 	13	 
	14.3
Subordination and Attornment 
	 	 	13	 
	14.4 Estoppel Certificate, Acknowledgment 
	 	 	14	 
	14.5 Sale by Landlord
	 	 	14	 
	14.6 Financial Information 
	 	 	14	 
	 
	 	 	 	 
	ARTICLE 15 — INDEMNITY, LIENS 
	 	 	14	 
	15.1 Tenant’s Indemnity
	 	 	14	 
	15.2 Personal Injury and Property Damage 
	 	 	15	 
	15.3 Liens
	 	 	15	 
	15.4
Granting of Security Interest 
	 	 	15	 
	 
	 	 	 	 
	ARTICLE 16 — DEFAULT, REMEDIES, TERMINATION
	 	 	15	 
	16.1 Default
	 	 	15	 
	16.2 Landlord may Perform 
	 	 	17	 
	16.3 Distress 
	 	 	17	 
	16.4 Costs and Interest 
	 	 	17	 
	16.5 Vacate Upon Termination, Survival 
	 	 	17	 
	16.6 Additional Rights on Default or Re-Entry 
	 	 	17	 
	16.7 No Waiver 
	 	 	18	 
	16.8 Remedies Cumulative 
	 	 	19	 
	16.9 For Lease Signs 
	 	 	19	 
	16.10 Holding Over 
	 	 	19	 
	16.11 Failure to Pay
	 	 	19	 
	16.12 Charge on Personal Property 
	 	 	19	 

 

 

iii

	 	 	 	 	 
	ARTICLE 17 — GENERAL PROVISIONS 
	 	 	20	 
	17.1 Approvals 
	 	 	20	 
	17.2 Landlord’s Performance 
	 	 	20	 
	17.3 Relationship of Parties
	 	 	20	 
	17.4 Sole Agreement and Survival of Agreement to Lease
	 	 	20	 
	17.5 Modifications 
	 	 	20	 
	17.6 No Brokerage Commission 
	 	 	20	 
	17.7 Registration
	 	 	21	 
	17.8
Construed Covenant, Severability 
	 	 	21	 
	17.9 Further Assurances 
	 	 	21	 
	17.10 Governing Law 
	 	 	21	 
	17.11 Time 
	 	 	21	 
	17.12 Notices 
	 	 	21	 
	17.13 Extended Meanings 
	 	 	22	 
	17.14 No Transfer on Bankruptcy 
	 	 	22	 
	17.15 Successors Bound 
	 	 	22	 
	17.16 Index and Headings 
	 	 	22	 
	17.17 Tenant’s Acceptance 
	 	 	22	 
	 
	 	 	 	 
	SCHEDULE “A” — DEFINITIONS 
	 	 	24	 
	 
	 	 	 	 
	SCHEDULE
“B” — LEGAL DESCRIPTION OF PREMISES 
	 	 	26	 

 

 

LEASE

THIS
LEASE, dated December 1, 1997, is made and entered into by the Landlord and Tenant named herein
who, in consideration of the covenants herein contained, agree as follows:

ARTICLE 1 — BASIC TERMS, SCHEDULE, DEFINITIONS

1.1 Basic Terms

	 	(a)	(i)	 	Landlord: NAR GROUP HOLDINGS LTD.

	 	(ii)	 	Address and Facsimile No. of Landlord:

#2, 53016 Hwy. 60 

Spruce Grove, Alberta T7X 3G7 

Fax: 489-4295

	 	(b)	(i)	 	 Tenant: NORTH AMERICAN CONSTRUCTION GROUP INC.

	 	(ii)	 	Address and Facsimile No. of Tenant:

#2, 53016 Hwy. 60 

Spruce Grove, Alberta T7X 3G7

Fax: 489-4295

	 	(c)	 	Address of Premises: #2, 53016 Hwy. 60

Spruce Grove, Alberta T7X 3G7
	 
	 	(d)	 	Legal Description of Premises: SCHEDULE “B”

	 	(e)	(i)	 	Term: Five (5) years

	 	(ii)	 	Commencement Date: December 1, 1997

	 	(f)	 	Minimum Rent:

	 	 	 	 	 	 	 
	 
	 	Lease Years

 Five
(5)        
	 	$/Annum

$480,000.00
	 	$/Month

$40,000.00

	 	(g)	 	Security Deposit: N/A
	 
	 	(h)	 	Permitted Use of Premises: Administration and operation of construction company,
including
repair and maintenance of heavy equipment.

          The foregoing Basic Terms are hereby approved by the parties and each reference in this Lease to
any of the Basic Terms shall be construed to include the provisions set forth above as well as all
of the additional terms and conditions of the applicable sections of this Lease where such Basic
Terms are more fully set forth.

 

2

1.2 Schedule

          The following schedule to this Lease is incorporated into and forms an integral part of
this Lease:

          Schedule “A” — Definitions

          Schedule “B” — Legal Description of Premises

1.3 Definitions

          In this Lease, the words, phrases and expressions set forth in Schedule “A” are used with
the meanings defined therein.

ARTICLE 2 — GRANT OF LEASE

2.1 Demise

          The Landlord, being registered as owner of the Premises legally described in Section l.l (d),
subject, however, to such mortgages and encumbrances as are registered against title thereto as of
the date hereof, does hereby lease the Premises to the Tenant, for the Term and upon and subject to
the covenants and conditions hereinafter expressed.

ARTICLE 3 — TERM, COMMENCEMENT, RENEWAL

3.1  Term

          The Term of this Lease shall be for the period set out in Section l.l(e)(i), beginning on the
Commencement Date, plus any partial calendar month following the Commencement Date if the
Commencement Date is other than the first day of a calendar month.

3.2 Commencement Date

          The Term shall commence on the Commencement Date.

ARTICLE 4 — RENT

4.1 Minimum Rent

          The Tenant shall pay to the Landlord in and for each Lease Year, Minimum Rent in the amount per
annum set out in Section l.1(f) for the respective Lease Year, by equal consecutive monthly
instalments in the amount set out in Section 1.l(f) for such Lease Year. If the Commencement Date is
not the first day of a calendar month, the Tenant shall pay, on such Commencement Date, as an
instalment of Minimum Rent, for the period from the Commencement Date to the last day of such
calendar month, inclusive, an amount calculated by multiplying the annual Minimum Rent for the
first Lease Year by the number of days during such period and dividing by three hundred and
sixty-five (365), and such instalment shall be in addition to the Minimum Rent payable for such
first Lease Year and the first regular instalment of Minimum Rent for such first Lease Year shall
be paid on the first day of the calendar month next following the Commencement Date.

4.2 Payment of Minimum Rent

          The first monthly instalment of Minimum Rent shall be paid on or before the Commencement
Date and subsequent instalments of Minimum Rent shall be paid strictly in advance on the first day
of each and every

 

3

succeeding month throughout the Term.

4.3 Pro Rata Adjustment of Rent

          All
rent shall be deemed to accrue from day to day, and if for any reason it shall become necessary
to calculate rent far irregular periods of less than one (1) year or one (1) month, as the case may
be, an appropriate pro rata adjustment shall be made in order to calculate rent for such irregular
period.

4.4 Payments Generally

          All payments by the Tenant to the Landlord of whatsoever nature required or contemplated by
this Lease shall be:

	 	(a)	 	paid to the Landlord by the Tenant in lawful currency of Canada;
	 
	 	(b)	 	made when due hereunder, without prior demand therefor and without any set-off,
compensation or deduction whatsoever at such place as the Landlord may designate from time to time
to the Tenant;
	 
	 	(c)	 	applied towards amounts then outstanding hereunder, in such manner as the Landlord
may, in its discretion, see fit, and without restricting the generality of the foregoing, no
acceptance by the
Landlord of any amount less than the full sum which is due and owing by the Tenant shall
constitute an accord and satisfaction or oblige the Landlord to accept in full settlement, anything
less than the full amount owing and outstanding at any time;
	 
	 	(d)	 	deemed to be rent, in partial consideration for which this Lease has been entered
into, and shall be payable and recoverable as rent, such that the Landlord shall have all rights
and remedies against the Tenant for default in making any such payment which may not be expressly
said to be rent as
the Landlord has for default in payment of rent;
	 
	 	(e)	 	subject to an overdue charge if any such payment is not made when due, which charge
shall be Additional Rent equal to the then existing Bank of Canada Prime Rate plus five (5%) per
cent per annum on the overdue amount both before and after judgment payable with the next monthly
instalment of Minimum Rent, all without prejudice to any other right or remedy of the
Landlord;
and
	 
	 	(f)	 	made, if the Landlord so requests, by way of a series of cheques, postdated to the respective
due dates of such payments, which the Tenant shall supply to the Landlord at the commencement of
each Lease Year or earlier should the Landlord so request, or by way of an automatic debiting
system by which payments are deducted from the Tenant’s bank account and credited to the
Landlord’s, all at the Tenant’s cost and all without prejudice to any other right or remedy of the
Landlord.

4.5  Security Deposit

          The
Tenant shall pay the Security Deposit to the Landlord which shall be
retained by the Landlord without liability for interest thereon, as security for the due performance by the Tenant
of its obligations under this Lease. The Security Deposit may be applied, in the Landlord’s
discretion, to remedy any default by the Tenant hereunder, whether in respect to the payment of
monies or otherwise, and in the absence of such default the Landlord shall return the Security
Deposit to the Tenant at the expiration of the Term. If any or all of the Security Deposit is
applied by the Landlord to remedy any default, then the Tenant shall forthwith upon written demand
from the Landlord, remit to the Landlord such monies as are sufficient to restore the amount of
money held on deposit by the Landlord to the original balance.

 

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ARTICLE 5 — ADDITIONAL RENT

5.1 Intent of Lease

          It is the intent of the parties and agreed that this Lease shall be absolutely net and
carefree to the Landlord such that, without limiting the generality of the foregoing, the Tenant
shall pay for its own account, and without any variation, set-off or deduction, all amounts,
charges, costs, duties, expenses, fees, rates, sums, taxes and increases therein in any way relating
to the Premises.

5.2 Additional Rent

          Without limiting the generality of the preceding Section, the Tenant shall pay to the Landlord
as Additional Rent in each Lease Year the aggregate of:

	 	(a)	 	Property Taxes;
	 
	 	(b)	 	Landlord’s Insurance as provided for in this Lease;
	 
	 	(c)	 	the Sales Tax;
	 
	 	(d)	 	such other amounts, charges, costs, sums or increases therein as are required to be paid
by the Tenant to the Landlord pursuant to this Lease in addition to Minimum Rent.

5.3 Estimate of Additional Rent

          The Landlord may, in respect of any or all of the items of Additional Rent, compute bona fide
estimates of the amounts which are anticipated to accrue in the next following Lease Year, calendar
year or fiscal year, or portion thereof, as the Landlord in its discretion may determine is the
most appropriate period for each or all items of Additional Rent, and the Landlord may provide the
Tenant with written notice of the amount of any such estimate.

5.4  Payment of Additional Rent

          With respect to any item of Additional Rent which the Landlord elects to estimate from time to
time, following receipt of the written notice of the estimated amount thereof, the Tenant shall pay
to the Landlord such amount, in equal consecutive monthly instalments throughout the applicable
period with the monthly instalments of Minimum Rent. With respect to any item of Additional Rent
which the Landlord has not elected to estimate from time to time, the Tenant shall pay to the
Landlord the amount of such item of Additional Rent, determined pursuant to the applicable
provisions of this Lease, forthwith upon receipt of an invoice therefor.

5.5 Adjustment of Additional Rent

          Within
ninety (90) days of the end of each Lease Year, calendar year or fiscal year, or portion
thereof, as the case may be, for which the Landlord has estimated any item of Additional Rent, the
Landlord shall compute the actual amount of such item of Additional Rent, and make available to the
Tenant for examination a statement of the gross amount of such item of Additional Rent, and the
calculation of the Tenant’s share thereof for each year or portion thereof. If the actual amount of
such item of Additional Rent, as set out in any such statement, exceeds the aggregate amount of the
instalments paid by the Tenant in respect of such item, the Tenant shall pay to  the Landlord the
amount of the excess within fifteen (15) days of the receipt of such statement. If the contrary is
the case, any such statement shall be accompanied by a refund to the Tenant of any such overpayment
without interest, provided that the Landlord may first deduct from such refund any rent or other
sum which is then owing by the Tenant or in arrears.

 

5

5.6 Pro Rata Adjustment of Additional Rent

          In
the event this Lease commences, expires or is terminated before the end of the period for
which any item of Additional Rent would otherwise be payable, the amount thereof payable by the
Tenant shall be apportioned and adjusted in accordance with the adjustment provisions of this
Lease.

5.7 Review of Additional Rent

          No party hereto may claim a readjustment in respect of any item of Additional Rent whether
paid or payable in instalments or otherwise, if based on any error of estimation, allocation,
calculation or computation thereof, unless claimed in writing prior to the expiration of one (1)
year from the conclusion of the period in respect of which such item of Additional Rent accrued.

ARTICLE 6 — TAXES

6.1 Tenant’s Taxes

          The Tenant shall pay promptly when due all business, sales, machinery, equipment and all other
taxes, assessments, charges and rates, as well as any permit or license fees, attributable to the
Premises or the property, business, sales or income of the Tenant in respect of the Premises.

6.2 Payment of Property Taxes 

          The Tenant shall pay the Property Taxes to the Landlord as Additional Rent.

6.2 Sales Tax

          The Tenant shall pay to the Landlord as Additional Rent, or as otherwise required by law, all
Sales Tax. The Landlord shall determine on a reasonable basis the extent to which the Sales Tax is
imposed by reason of any sum payable by the Tenant to the Landlord pursuant to any provisions of
this Lease and any report of the Landlord’s chartered accountant for such purpose shall be
conclusive as to the amount of any Sales Tax for any period to which such report relates.

ARTICLE 7 —  UTILITIES AND SERVICES

7.1 Tenant’s Utilities and Services

          The Tenant shall pay all rates, charges, costs and expenses as may be assessed or levied and
at the rates so assessed or levied by all suppliers of utilities and services directly to the
Premises.

ARTICLE 8 – INSURANCE

8.1 Tenant’s Insurance

	 	(a)	 	The Tenant shall, during the whole of the Term and during such other time as the Tenant
occupies the Premises, take out and maintain the following insurance, at the Tenant’s sole expense,
in such form and with such companies as the Landlord may reasonably approve:

	 	(i)	 	comprehensive general liability insurance applying to all operations of the Tenant and
against claims for bodily injury, including death, and property damage or loss arising out of the
use or occupation of the Premises, or the Tenant’s business on or about the

 

6

	 	 	 	Premises: such insurance shall include the Landlord as an additional insured and indemnify and
protect both the Tenant and Landlord and shall contain a “cross liability” or “severability of
interests” clause so that the Landlord and the Tenant may be insured in the same manner and to the
same extent as if individual policies had been issued to each, and shall be for the amount of not
less than One Million ($1, 000,000.00) Dollars combined single limit or such other amount as may be
reasonably required by the Landlord from time to time; and such comprehensive general liability
insurance shall, for the Tenant’s benefit only, include contractual liability and tenant’s legal
liability insurance in a form and of a nature broad enough to insure the obligations imposed upon
the Tenant under the terms of this Lease;
	 
	 	(ii)	 	“all risks” insurance upon its merchandise, stock-in-trade, furniture, fixtures and
improvements including leasehold improvements and upon all other property in the Premises owned by
the Tenant or for which the Tenant is legally liable, and insurance upon all glass and plate glass
in the Premises, against breakage and damage from any cause, all in an amount equal to the full
replacement value thereof, which amount in the event of a dispute shall be determined by the
decision of the Landlord; and
	 
	 	(iii)	 	boiler and machinery insurance on such boilers and pressure vessels as may be installed by or
under the exclusive control of the Tenant in the Premises.

	 	(b)	 	The policies of insurance referred to above shall contain the following additional
provisions:

	 	(i)	 	provisions that the Landlord is protected notwithstanding any
act, neglect or misrepresentation
of the Tenant which might otherwise result in the avoidance of a claim under-such policies and
such that such policies shall not be affected or invalidated by any act, omission or negligence of
any third party which is not within the knowledge or control of the insured(s);
	 
	 	(ii)	 	provisions that such policies and the coverage evidenced thereby shall be primary and non-contributing with respect to any policies carried by the Landlord and that any coverage carried by
the Landlord shall be excess coverage;
	 
	 	(iii)	 	all property and boiler insurance referred to above shall provide for waiver of the insurer’s
rights of subrogation as against the Landlord;
	 
	 	(iv)	 	provisions that such policies of insurance shall not be cancelled without the insurer
providing the Landlord thirty (30) days written notice stating when such cancellation shall
be effective.

	 	(c)	 	Evidence satisfactory to the Landlord of all such policies of insurance shall be
provided to the Landlord upon request.
	 
	 	(d)	 	The Tenant shall further during the whole of the Term maintain such other insurance in
such amounts and upon such sums as the Landlord may reasonably determine from time to time.
	 
	 	(e)	 	The proceeds of all property insurance maintained by the Tenant are hereby assigned
and made payable to the Landlord, and to the extent that such proceeds have been paid to the
Landlord, they shall be released to the Tenant (provided the Tenant
is not in default hereunder):

	 	(i)	 	upon the Tenant’s written request, in progress payments, at stages determined by the Architect,
upon receipt by the Landlord of a certificate from the Architect
stating that repairs to each stage
have been completed, free of liens, by the Tenant, provided that in the event of the Tenant’s
default in making such repairs and if the Landlord performs

 

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	 	 	 	repairs, the proceeds may be applied by the Landlord to the costs thereof; or
	 
	 	(ii)	 	upon termination of this Lease by the Landlord upon the happening of Substantial Damage or
Destruction, but only to the extent of the value of any trade fixtures or stock-in-trade
of the Tenant, but not to the extent of the value of any leasehold improvements made by the Tenant
to the Premises.

8.2 Landlord’s Insurance

          The Landlord may take out or cause to be taken out and keep or cause to be kept in full
force and effect:

	 	(a)	 	standard fire and extended coverage insurance on the Premises, except foundations, and
should the Landlord so elect, insurance to cover any loss of rental income which may be sustained
by the Landlord;
	 
	 	(b)	 	comprehensive general liability insurance against claims for bodily injury, including
death and property damage in such form and subject to such deductions and exceptions as the
Landlord may determine;

provided that nothing herein shall prevent the Landlord from providing or maintaining such lesser,
additional or broader coverage as the Landlord may elect in its discretion.

8.3 Increases in Rates

          The Tenant shall not do, omit or permit to be done or omitted upon the Premises
anything which shall cause any rate of insurance upon the Premises or
any part thereof to be
increased or cause insurance to be cancelled. If any such rate of insurance shall be increased as
aforesaid, the Tenant shall pay to the Landlord the amount of the increase as Additional Rent. If
any insurance policy upon the Premises or any part thereof is cancelled or threatened to be
cancelled by reason of the use or occupancy by the Tenant or any act
or omission as aforesaid, the
Tenant shall forthwith remedy or rectify such use, occupation, act or omission upon being requested
to do so by the Landlord, and if the Tenant fails to so remedy or rectify, the Landlord may at its
option terminate this Lease forthwith and the Tenant shall immediately deliver up possession of the
Premises to the Landlord.

8.4 Recovery of Landlord’s Premiums

          For purposes of the recovery of the cost of insurance premiums paid by the Landlord, such
premiums shall be included in Additional Rent and recovered in accordance with the provisions of
this Lease.

ARTICLE 9 — USE AND OCCUPATION

9.1 Quiet Enjoyment

          The Landlord covenants with the Tenant for quiet enjoyment, for so long as the Tenant is not
in default hereunder, and except as provided herein.

9.2 Use

          The Premises shall be used for the purpose set forth in Section l.l(h) and for no other purpose.

9.3  Covenant to Operate

          The Tenant shall throughout the whole of the Term continuously operate, occupy and utilize
the

 

8

entire Premises and conduct its business therein complying strictly with the provisions of this
Lease. The Tenant acknowledges that the Landlord is executing this Lease in reliance upon the
Tenant’s covenant herein contained and  that such covenant is a material element inducing the
Landlord to execute this Lease.

9.4 Signs

          The Tenant may erect, install and maintain, all at the Tenant’s sole expense, a sign of a kind and
size and in a location as first approved in writing by the Landlord. The Tenant shall not erect,
install or maintain any sign other than in accordance with this Article. At the expiration or
earlier termination of this Lease, the Tenant shall, if required to do so by the Landlord, remove
any such sign or signs and repair any loss or damage to the Premises occasioned thereby, all at the
Tenant’s sole expense.

9.5 Compliance with Laws

          The
Tenant shall carry on and conduct its business from the Premises in such manner as to
comply with any and all statutes, by-laws, rules and regulations of any Federal, Provincial,
Municipal or other competent authority for the time being in force, and shall not do anything upon
the Premises in contravention thereof.

9.6 Nuisance 

          The Tenant shall not do or permit to be done or omitted anything which could damage the
Premises or injure or impede the business of the Tenant or which shall or might result in any
nuisance in or about the Premises, whether to the Landlord, or any other party, the whole as
determined by the Landlord, acting reasonably. In any of the foregoing events, the Tenant shall
forthwith remedy the same and if such thing or condition. shall not be so remedied, the Landlord
may, after such notice, if any, as the Landlord may deem appropriate
in the circumstances, correct
such situation at the expense of the Tenant and the Tenant shall pay such expense to the Landlord
as Additional Rent.

ARTICLE 10 — HAZARDOUS SUBSTANCES ON THE PREMISES

10.1 Hazardous Substances

          The Tenant shall not cause or permit any Hazardous Substance to be brought upon, kept or
used in or about the Premises without the prior written consent of the Landlord, which consent shall
not be unreasonably withheld if the Tenant demonstrates to the Landlord’s reasonable satisfaction
that such Hazardous Substance is reasonably necessary for the Tenant’s permitted use of the
Premises and that it will be used, kept, stored and disposed of in a manner that complies with all
Environmental Laws.

10.2 Reporting Requirements

          At the commencement of each Lease Year the Tenant shall disclose to the Landlord the names
and
approximate amounts of all Hazardous Substances that the Tenant intends to store, use or dispose of
on the Premises in the coming Lease Year. In addition, at the commencement of each Lease Year,
beginning with the second Lease Year, the Tenant shall disclose to the Landlord the names and
amounts of all Hazardous Substances that were actually used, stored or disposed of on the Premises
if those materials were not previously identified to the Landlord at the commencement of the
previous Lease Year.

10.3 Compliance with Environmental Laws

	 	(a)	 	The Tenant shall at the Tenant’s own expense comply with all Environmental Laws and
shall make, obtain and deliver all reports and studies as required by any governmental agency,
authority or any Environmental Laws.

 

9

	 	(b)	 	The Tenant authorizes the Landlord to make inquiries from time to time of any governmental
agency or authority in order to determine the Tenant’s compliance with the Environmental Laws. The
Tenant covenants and agrees that it will from time to time provide to the Landlord such written
authorization as the Landlord may reasonably require in order to facilitate, the obtaining of such
information.
	 
	 	(c)	 	The Tenant shall immediately advise the Landlord of any breach of any part of this Article or
if any governmental agency or authority issues an order, notice, cancellation, amendment, charge,
violation, ticket or other document concerning the release, investigation, clean up, remediation or
abatement of any Hazardous Substance.

10.4 Clean Up or Removal

          If any government authority shall require the clean up or removal of any Hazardous Substance held,
released, spilled, abandoned or placed upon the Premises or released into the environment by the
Tenant in the course of the Tenant’s business or as a result of the Tenant’s use or occupancy of
the Premises, then the Tenant shall, at its own expense, prepare and submit for approval all
necessary studies, plans and proposals, shall provide all bonds and other security required by
governmental authorities and shall forthwith carry out the work required. The Tenant shall keep the
Landlord fully informed of the progress of the matter and shall provide to the Landlord full
information with respect to proposed plans and comply with the Landlord’s reasonable requirements
with respect to such plans. The Tenant further agrees that if the Landlord determines, in its
discretion, that the Premises, the Landlord or the Landlord’s reputation is placed in
any jeopardy by the requirements for any such work, the Landlord may itself undertake such work or
any part thereof at the cost and expense of the Tenant.

10.5 Indemnity

          The Tenant shall indemnify and hold harmless the Landlord from any and all claims, damages, fines,
judgments, penalties, costs, liabilities or losses arising out of or in any way related to any
contamination of the Premises in any manner for which the Tenant is legally liable including,
without limitation, any personal injury or property damage, a decrease in value of the Premises,
damages caused by loss or restriction of rentable or useable space, or any damages caused
by adverse impact on marketing of the space, any and all sums paid for settlement of claims and any
lawyer’s, consultant’s, agent’s or expert’s fees. The provisions of this Section shall be in
addition to any other obligations and liabilities that the Tenant may have to the Landlord at law
or equity and shall survive the transactions contemplated herein and the termination of this Lease.

10.6 Ownership of Hazardous Substances

          If the Tenant creates or brings to the Premises any Hazardous Substances or if the conduct of the
Tenant’s business shall cause there to be any Hazardous Substance at the Premises then,
notwithstanding any rule of law to the contrary, such Hazardous Substance shall be and remain the
sole and exclusive property of the Tenant and shall not become the property of the Landlord
notwithstanding the degree of affixation to the Premises of the Hazardous Substances, and
notwithstanding the expiry or earlier termination of this Lease.

ARTICLE 11 — CLEANING, REPAIR 

11.1 Cleaning

	 	(a)	 	The Tenant shall, at its sole expense, keep the Premises and, without limitation, the yard and
Parking Areas, the inside and outside of all glass windows and doors of the Premises and all
exterior surfaces of the Premises, in a neat, clean and sanitary condition and shall not allow any
refuse, garbage or other loose or objectionable or waste material to accumulate in or about the
Premises, yard or Parking Areas. All refuse shall be disposed of on a timely basis and in a
reasonable manner.

 

10

	 	(b)	 	The Tenant shall, immediately before the termination of the Term, wash the floors, windows,
doors, walls and woodwork of the Premises and shall not, upon such termination, leave upon the
Premises any refuse, garbage or waste material.
	 
	 	(c)	 	Without restricting the foregoing, the Tenant shall pay for its own janitorial services,
cleaning of debris, removal of garbage, landscaping, yard and Parking Area maintenance, and such
other costs as may be incurred in cleaning in accordance with this Article.
	 
	 	(d)	 	In the event the Tenant fails to clean or maintain in accordance with this Article upon notice
so to do from the Landlord, the Landlord may attend to the same and the Tenant shall pay to the
Landlord as Additional Rent the cost thereof.

11.2 Tenant’s Repairs

	 	(a)	 	The Tenant shall repair the Premises, only excepting reasonable wear and tear and repairs which
are the responsibility of the Landlord pursuant to this Article, but including any damage to or
breakage of glass, plate glass, shop windows, mouldings, storefronts, signs, doors, hardware,
lighting, wiring, plumbing, improvements, partitions, wall fixtures and all trade fixtures and
furnishings of the Tenant or otherwise in or for the Premises and the Tenant shall maintain in good
condition the interior of the Premises, any appurtenances thereto, any improvements now or
hereafter erected or installed therein and any apparatus or equipment of the Tenant therein or
therefor.
	 
	 	(b)	 	The Tenant shall keep well-painted at all times the interior of the Premises in accordance with
the reasonable requests of the Landlord, using colours which shall first be approved in writing by
the Landlord.
	 
	 	(c)	 	The Tenant shall maintain all heating, ventilation, air-conditioning and plumbing facilities
within the Premises and all drains therefrom in good repair and working order.
	 
	 	(d)	 	The Tenant, its employees or agents shall not mark, paint, drill or in any way deface any
walls, ceilings, partitions, floors, wood, stone, brick or ironwork without the written approval of
the Landlord.

11.3 View Repairs

          The Landlord may enter the Premises at any reasonable time during business hours and at any time
during any emergency to view the state of repair and the Tenant shall repair according to notice in
writing from the Landlord so to do, subject to the exceptions contained in this Article.

11.4 Landlord may Maintain and Repair

          If the Tenant fails to maintain and repair as required herein and according to notice from the
Landlord within fourteen (14) days of receipt thereof, or such shorter period as may be reasonable
in the circumstances, the Landlord may complete such maintenance and repair without liability to
the Tenant for any loss or damage that may occur to the Tenant’s merchandise, fixtures or other
property or to the Tenant’s business by reason thereof, and upon completion thereof, the Tenant
shall pay as Additional Rent the Landlord’s cost for conducting such repairs or maintenance.

11.5 Landlord’s Repairs

	 	(a)	 	The Landlord shall be responsible for Structural Repairs to the Premises caused by perils
against which the Landlord has insured, unless caused by the negligence of the Tenant, or persons
for whom the Tenant is responsible in law.

 

11

	 	(b)	 	The Landlord shall not be liable for any loss or damage to any person or property for its
failure to repair in accordance with this Article, unless such loss or damage is caused by the
default or negligence of the Landlord, its agents, employees or contractors and is not specifically
excepted pursuant to the provisions of this Lease.
	 
	 	(c)	 	In fulfilling its obligations pursuant to this Article, the Landlord shall be entitled to enter
the Premises and shall act as expeditiously as is reasonably possible in the circumstances.

11.6 Talking of Possession

          The taking of possession of the Premises by the Tenant shall be conclusive evidence against the
Tenant, that at the time of taking possession, the Premises were in good and fully satisfactory
order and condition.

ARTICLE 12 — ALTERATIONS, FIXTURES

12.1 Tenant’s Alterations 

	 	(a)	 	The Tenant shall not make or cause to be made any alterations, additions or improvements
or erect or cause to be erected any partitions or install or cause to be installed any trade
fixtures, exterior signs, floor covering, interior or exterior lighting, plumbing fixtures, shades,
awnings, exterior decorations or make any changes to the Premises without first obtaining the
Landlord’s written
approval thereto, such approval not to be unreasonably withheld in the case of alterations,
additions or improvements to the interior of the Premises.
	 
	 	(b)	 	All fixtures installed by the Tenant shall be new, provided that the Tenant may install its
usual trade fixtures in its usual manner so long as such installation has first been approved by
the Landlord and does not damage the structure of the Premises.
	 
	 	(c)	 	The Tenant shall not install in or for the Premises any special locks, safes, or apparatus for
air-conditioning, cooling, heating, illuminating, refrigerating or ventilating the Premises without
first obtaining the Landlord’s written approval thereto.
	 
	 	(d)	 	When seeking the approval of the Landlord as required by this Article, the Tenant shall present
to the Landlord plans and specifications of the proposed work.
	 
	 	(e)	 	The Tenant shall promptly pay all contractors, material suppliers and workmen so as to minimize
the possibility of a lien attaching to the Premises and should any claim or lien be made or filed
the Tenant shall discharge the same.

12.2 Removal of Fixtures 

	 	(a)	 	So long as the Tenant is not in default hereunder at the expiration of the Term, the Tenant
shall then have the right to remove its trade fixtures from the Premises but shall make good any
damage caused to the Premises resulting from the installation or removal thereof; provided that all
alterations, additions and improvements constructed and installed in the Premises and attached in
any manner to the floors, walls or ceiling, including any floor covering and light fixtures, are
hereby deemed not to be trade fixtures and shall remain upon and be surrendered with the Premises,
except to the extent the Landlord requires removal thereof.
	 
	 	(b)	 	If the Tenant fails to remove its trade fixtures and restore the Premises as aforesaid, all
such trade fixtures shall become the property of the Landlord except to the extent that the
Landlord continues to require removal thereof.

 

12

	 	(c)	 	Should the Tenant abandon the Premises or should this Lease be terminated before the proper
expiration of the Term due to a default on the part of the Tenant then, in such event, as of the
moment of default by the Tenant, all trade fixtures and furnishings of the Tenant (whether or not
attached in any manner to the Premises) shall, except to the extent the Landlord requires the
removal thereof, become and be deemed to be the property of the Landlord, without indemnity to the
Tenant and as additional liquidated damages in respect of such default but without prejudice to any
other right or remedy of the Landlord.
	 
	 	(d)	 	Notwithstanding that any trade fixtures, alterations, additions, improvements or fixtures are
or may become the property of the Landlord, the Tenant shall forthwith remove all or part of the
same and shall make good any damage caused to the Premises resulting from the installation or
removal thereof, all at the Tenant’s expense, should the Landlord so require by notice to the
Tenant.
	 
	 	(e)	 	If the Tenant, after receipt of a notice from the Landlord, fails to promptly remove any trade
fixtures, furnishings, alterations, additions, improvements and fixtures in accordance with such
notice, then the Landlord may enter into the Premises and remove therefrom all or part of such
trade fixtures, furnishings, alterations, additions, improvements and fixtures without any
liability and at the expense of the Tenant, which expense shall forthwith be paid by the Tenant to
the Landlord.

ARTICLE 13 — SUBSTANTIAL DAMAGE AND DESTRUCTION, EXPROPRIATION

13.1 No Abatement

        If during the Term the Premises shall be damaged or destroyed by any cause whatsoever such that
the Premises are rendered unfit for occupancy by the Tenant, the rent hereby reserved shall not
abate in whole or part except to the extent that such rent is recovered by the Landlord under any
policies of insurance against rental loss which the Landlord may have taken out.

13.2 Substantial Damage or Destruction

        In the event of Substantial Damage or Destruction of the Premises the Landlord may within sixty
(60) days after such damage or destruction and on giving thirty (30) days written notice to the
Tenant declare this Lease terminated forthwith and in such event, the Term shall be deemed to have
expired and the Tenant shall deliver up possession of the Premises accordingly, rent shall be
apportioned and shall be payable up to the date of termination stated in such notice and the Tenant
shall be entitled to be repaid by the Landlord any rent paid in advance and unearned or an
appropriate portion thereof.

13.3 Rebuilding

        If this Lease is not terminated pursuant to this Article, and such damage or destruction is insured
against by the Landlord the Landlord shall cause such damage or destruction. to be repaired,
restored or reconstructed, save as to items which are the responsibility of the Tenant pursuant to
any provision of this Lease.

13.4 Expropriation

	 	(a)	 	If during the Term, title is taken to the whole or any part of the Premises by any competent
authority under the power of eminent domain or by expropriation, the Landlord may at its option
terminate this Lease on the date possession is taken by or on behalf of such authority. Upon such
termination, the Tenant shall immediately deliver up possession of the Premises, rent shall be
payable up to the date of such termination and the Tenant shall be entitled to be repaid by the
Landlord any rent paid in advance and unearned or an appropriate portion thereof.

 

13

	 	(b)	 	In the event of any such taking, the Tenant shall have no claim upon the Landlord for the value
of its property or the unexpired portion of the Term, but the parties shall each be entitled to
separately advance their claims for compensation for the loss of their respective interests and to
receive and retain such compensation as may be awarded to each respectively. If an award of
compensation made to the Landlord specifically includes an award for the Tenant, the Landlord will
account therefor to the Tenant.

ARTICLE
14 — ASSIGNMENT, SUBLETTING, SALE OR MORTGAGE

14.1 Assignment and Subletting

          The Tenant shall not assign this Lease in whole or in part, nor sublet all or any part of the
Premises, nor grant any license or part with possession of the Premises or transfer any other right
or interest under this Lease, or, if the Tenant is a corporation, cause or permit to occur either
directly or indirectly any change in its ownership or control, all without the prior written
consent of the Landlord in each instance, which consent shall not be unreasonably withheld or
delayed provided the proposed assignment or sublease or change in ownership or control complies
with the following provisions:

	 	(a)	 	notwithstanding any assignment or sublease, the Tenant shall remain fully liable on this Lease
and shall not be released from performing any of the terms, covenants and conditions of this Lease;
	 
	 	(b)	 	if the Lease is assigned or if the Premises or any part thereof are sublet or occupied by
anyone other than the Tenant, the Landlord may collect rent directly from the assignee, subtenant
or occupant, and apply the net amount collected, or the necessary portion thereof, to the rent
herein reserved;
	 
	 	(c)	 	no assignment, sublease or transfer of ownership or control of the Tenant shall be made or
proposed other than to substantial and responsible persons, firms, partnerships or bodies corporate
who have financial strength equal to or greater than the Tenant and who are experienced in and
agree to carry on the type of business conducted in the Premises by the Tenant, as set form in
Section 1.1(h), and in the case of any assignment or subletting who undertake in favour of the
Landlord to perform and observe the obligations of the Tenant hereunder by entering into an
assumption agreement directly with the Landlord;
	 
	 	(d)	 	the prohibition against assigning or subletting without the consent required by this Article
shall be construed to include a prohibition against any assignment or sublease by operation of law;
	 
	 	(e)	 	the consent by the Landlord to any assignment or sublease shall not constitute a waiver of the
necessity of such consent to any subsequent assignment or sublease.

14.2 Bulk Sale

          No bulk sale of the goods and assets of the Tenant out of the ordinary course of business may take
place without first obtaining the written consent of the Landlord, which consent shall not be
unreasonably withheld so long as the Tenant and me purchaser are able to provide the Landlord with
assurances, in a form satisfactory to the Landlord, that the Tenant’s obligations hereunder will
continue to be performed and respected, in the manner satisfactory to the Landlord, after
completion of the sale.

14.3 Subordination and Attornment

	 	(a)	 	This Lease and the Tenant’s rights hereunder shall automatically be subordinate to any mortgage
or encumbrance resulting from any method of financing or refinancing, now or hereafter in force
against the Premises or any part thereof, as now or hereafter constituted, and to all advances made

 

14

	 		 	or hereafter to be made upon the security hereof; and, upon the request of the Landlord, the Tenant
shall execute such documentation as may be required by the Landlord in order to confirm and
evidence such subordination.

	 	(b)	 	The Tenant shall, in the event any proceedings are brought, whether in foreclosure or by way of
the exercise of the power of sale or otherwise, under any mortgage or other method of financing or
refinancing made by the Landlord in respect of the Premises, attorn to the encumbrancee upon any
such foreclosure or sate and recognize such encumbrancee as the Landlord under this Lease, should
such encumbrancee so elect and require.
	 
	 	(c)	 	The Landlord shall use its best efforts to ensure that no subordination or attornment as
required by this Article shall have the effect of disturbing the Tenant’s occupation and possession
of the Premises, provided that the Tenant is not in default hereunder and complies with all of the
covenants, terms and conditions hereof.

14.4 Estoppel Certificate, Acknowledgment 

	 	(a)	 	Whenever requested by the Landlord, a mortgagee, an encumbrance holder or other third party
having any interest in the Premises, the Tenant shall within ten (10) days of the request execute
and deliver an estoppel certificate or other form of certified acknowledgment as to the
Commencement Date, the status and the validity of this Lease, the state of the rental account
hereunder, any incurred defaults on the part of the Landlord alleged by the Tenant, and such other
information as may reasonably be required, including, if requested, a copy of the Tenant’s most
recent audited financial statements.
	 
	 	(b)	 	Tenant’s failure to deliver such certificate or acknowledgment within the time provided shall
constitute default hereunder and shall be conclusive against the Tenant that the information set
out in the certificate or acknowledgment which the Tenant was requested to execute is as set but in
such certificate or acknowledgment.

14.5 Sale by Landlord

          In the event of a sale by the Landlord of any portion or all its interest in the Premises, the
Landlord shall thereafter be entirely relieved of the performance of all terms, covenants and
obligations thereafter to be performed by the Landlord under this Lease, to the extent of the
interest or portion so sold or transferred and it shall be deemed and construed without further
agreement between the parties that the purchaser or transferee, as the case may be, has assumed and
agreed to carry out any and all covenants of the Landlord hereunder.

14.6 Financial Information

          The Tenant shall, upon request, provide the Landlord with such information as to the financial
standing and corporate organization of the Tenant or any indemnifier or guarantor of this Lease, as
the Landlord or any mortgagee of the Premises may require.

ARTICLE
15 — INDEMNITY, LIENS 

15.1
Tenant’s Indemnity

          The Tenant shall at all times during the Term, indemnify and save harmless the Landlord of and from
all loss and damage and all actions, claims, costs, demands, expenses, fines, liabilities and suits
of any nature whatsoever for which the Landlord shall or may become liable, incur or suffer by
reason of a breach, violation or non-performance by the Tenant of any covenant, term or provision
hereof or by reason of any builders’ or other liens for any work done or materials provided or
services rendered for alterations, improvements or repairs to the

 

15

Premises, made by or on behalf of
the Tenant, or by reason of any injury occasioned to or suffered by any person or damage
to any property, by reason of any wrongful act or omission, default or negligence on the part of
the Tenant or any of its agents, concessionaires, contractors, customers, employees, invitees or
licensees in or about the Premises.

15.2 Personal Injury and Property Damage

          The Landlord shall not be liable or responsible for:

	 	(a)	 	any personal injury or consequential damage of any nature whatsoever, however caused, that may
be suffered or sustained by the Tenant or by any other person who may be upon the Premises; or
	 
	 	(b)	 	any loss or damage of any nature whatsoever, howsoever caused, to the Premises, any property
belonging to the Tenant or to any other person while such property is in or about the Premises.

15.3 Liens

          The Tenant shall, immediately upon demand by the Landlord, remove or cause to be removed, and
thereafter institute and diligently prosecute any action pertinent
thereto, any builders’ or other
lien or claim of lien noted or filed against or otherwise constituting an encumbrance on any title
of the Landlord. Without limiting the foregoing obligations of the Tenant, the Landlord may cause
the same to be removed, in which case the Tenant shall pay to the Landlord as Additional Rent the
cost thereof, including the Landlord’s complete legal costs.

15.4 Granting of Security Interest 

	 	(a)	 	The Tenant shall not grant a Security Interest in any goods that have become affixed to the
Premises, and the Tenant shall not affix to the Premises any goods which are subject to a Security
Interest.
	 
	 	(b)	 	The Tenant shall not permit any notice claiming a Security Interest in any fixture to be
registered against title to the Premises and shall, immediately upon demand by the Landlord, remove
or cause to be removed any such notice and institute and diligently prosecute any proceedings
pertinent thereto.

ARTICLE
16 — DEFAULT, REMEDIES, TERMINATION

16.1 Default

          If and whenever:

	 	(a)	 	the Tenant shall be in default in the payment of any money, whether hereby expressly reserved
or deemed as rent, or any part thereof, and such default shall continue for seven (7) days
following any specific due date on which the Tenant is to make such payment or, in the absence of
such specific due date, for the seven (7) days following written notice by the Landlord requiring
the Tenant to pay the same; or
	 
	 	(b)	 	the Tenant’s leasehold interest hereunder, or any goods, chattels or equipment of the Tenant
located in the Premises shall be taken or seized in execution or attachment, or if any writ of
execution shall issue against the Tenant and not be discharged within fourteen (14) days of its
issuance, or the Tenant shall become insolvent or commit an act of bankruptcy or become bankrupt or
take the benefit of any Act that may be in force for bankrupt or insolvent debtors or become
involved in voluntary or involuntary winding up, dissolution or liquidation proceedings, or if a
receiver or receiver and manager shall be appointed for the affairs, business, property or revenues
of the Tenant; or

 

16

	 	(c)	 	the Tenant shall fail to commence, diligently pursue and complete the Tenant’s work to
be performed pursuant to any agreement to lease pertaining to the Premises or other agreement
signed by the parties or fail to open for business when required by the provisions of this Lease,
or vacate or abandon the Premises or fail or cease to operate pursuant to the provisions of this
Lease or otherwise cease to conduct business from the Premises, or use or permit or suffer the use
of the Premises for any purposes other than as allowed pursuant to this Lease, or fail to remedy or
rectify any act or omission hereunder, or if the Tenant should make a bulk sale of its goods and
assets which has not been consented to by the Landlord, or move or commence, attempt or threaten to move its goods, chattels and equipment out of the Premises other than in the routine and ordinary
course of its business; or
	 
	 	(d)	 	the Tenant or any agent of the Tenant falsifies any report or statement required to be
furnished to the Landlord or anyone else pursuant to this Lease; or
	 
	 	(e)	 	the Tenant makes a sale in bulk out of the ordinary course of business of any of its assets,
wherever situated (other than a bulk sale made to an Assignee or Sublessee pursuant to a permitted
assignment or subletting hereunder); or
	 
	 	(f)	 	the Tenant abandons or attempts to abandon the Premises, or sells or disposes of the trade
fixtures, goods or chattels of the Tenant
or removes them from the Premises so that there would not in the event of such sale or disposal be
sufficient trade fixtures, goods or chattels of the Tenant on the Premises subject to distress to
satisfy all rent due or accruing hereunder for a period of at least twelve (12) months; or
	 
	 	(g)	 	the Premises become and remain vacant for a period of five (5) consecutive days or are used by
any persons other than such as are entitled to use them hereunder; or
	 
	 	(h)	 	ownership or control of the Tenant changes or the Tenant assigns, transfers, encumbers, sublets
or permits me occupation or use or the parting with or sharing possession of all or any part of the
Premises by anyone except in a manner permitted by this Lease; or
	 
	 	(i)	 	re-entry is permitted under any other term of this Lease; or
	 
	 	(j)	 	the Tenant fails to observe, perform or keep each and every of the covenants, agreements,
stipulations, obligations, conditions and other provisions of this Lease to be observed, performed
and kept by the Tenant and persists in such default, in the case of monetary payments, beyond the
seven (7) day period stipulated in paragraph (a) aforesaid or, in the case of any other default,
after seven (7) days following written notice from the Landlord requiring that the Tenant remedy,
correct or comply or, in the case of any such default which would reasonably require more than
seven (7) days to rectify, unless the Tenant shall commence rectification within the said seven (7)
day notice period and thereafter promptly and diligently and continuously proceed with the
rectification of any such default;

then, and in each of such cases, and at the option of the Landlord and in addition to any other
rights or remedies the Landlord may have pursuant to this Lease or at law, the Landlord may,
immediately re-enter upon the Premises and may expel all occupants thereof and remove all property
from the Premises and such property may be removed and  sold or disposed of by the Landlord in
such manner as it deems advisable, including by private sale, or may be stored in a public
warehouse or elsewhere at the cost and for the account of the Tenant, all without service of notice
or resort to legal process and without the Landlord being considered guilty of trespass or becoming
liable for any loss or damage which may be occasioned thereby. If the Landlord elects to re-enter
the Premises as herein provided, or if it takes possession pursuant to legal proceedings or
pursuant to any notice provided for by law, it may either terminate this Lease or it may from time
to time without terminating this Lease, make such alterations and
repairs

 

17

as are necessary in order
to relet the Premises, or any part thereof, for such term or terms (which may be for a term
extending beyond the Term) and at such rent and upon such other terms, covenants and conditions as
the Landlord in its sole discretion considers advisable.

16.2 Landlord may Perform

        If the Tenant shall fail to observe, perform or keep any of the provisions of this Lease to be
observed, performed and kept by the Tenant, the Landlord may, but shall not be obliged to, at its
discretion and without prejudice to any other right, claim or action it may have, rectify the
default of the Tenant, whether or not performance by the Landlord on behalf of the Tenant is
otherwise expressly referred to in the applicable Section of this
Lease. For such purpose the
Landlord may make any payment or do or cause to be done such things as may be required including,
without limiting the generality of the foregoing, entry upon the Premises. Any such performance by
or at the behest of the Landlord shall be at the expense of the Tenant and the Tenant shall pay to
the Landlord as Additional Rent the cost thereof.

16.3 Distress

        If
and whenever the Tenant shall be in default in the payment of any money, whether hereby expressly
reserved or deemed as rent, or any part thereof, the Landlord may, without notice or any form of
legal process whatever, enter upon the Premises and seize, remove and
sell by judicial or formal
process or by private sale the Tenant’s goods, chattels and equipment therefrom or seize, remove
and sell, by judicial or formal process or by private sale, any goods, chattels and equipment at
any place to which the Tenant or any other person may have removed them, in the same manner as if
they had remained and been distrained upon the Premises, all notwithstanding any rule of law or
equity to the contrary, and the Tenant hereby waives and renounces the benefit of any present or
future statute or law limiting or eliminating the Landlord’s right of distress or sale.

16.4 Costs and Interest

        All costs, expenses and expenditures of the Landlord, incurred upon any default by the Tenant
hereunder, including, without limitation, the legal costs incurred by the Landlord on an
indemnification basis as between solicitor and his own client shall, forthwith on demand, be paid
by the Tenant to the Landlord as Additional Rent. All rent and other sums due to the Landlord
pursuant to the
terms of this Lease shall be paid by the Tenant promptly when due, and if not so paid, shall bear
interest from their respective due dates at the rate of five (5%) per cent per annum above the then
existing Bank of Canada Prime Rate, both before and after default, demand and judgment.

16.5 Vacate Upon Termination, Survival

        At the termination of this Lease, whether by affluxion of time or otherwise, the Tenant shall
vacate and deliver up possession of the Premises in the same state and condition as they where in
upon delivery of possession to the Tenant, subject to the exceptions from the Tenant’s obligation
to repair and subject to the Tenant’s rights and obligations in respect of removal and the Tenant
shall thereupon surrender all keys to the Premises to the Landlord at the place then fixed for
payment of rent and shall inform the Landlord of all combinations on locks, safes and vaults, if
any, in the Premises. The indemnity agreements contained in this Lease shall survive the
termination of this Lease.

16.6 Additional Rights on Default or Re-Entry

        If the Tenant shall be in default under this Lease beyond any period given herein to rectify such
default, or if the Landlord shall re-enter the Premises or terminate this Lease when entitled to do
so pursuant to default of the Tenant hereunder, then:

	 	(a)	 	notwithstanding any such re-entry, termination, or the Term thereby becoming forfeited and
void, the provisions of this Lease relating to the consequences of termination shall survive;

 

18

	 	(b)	 	the Landlord may use such force as it may deem necessary for the purpose of gaining admittance
to and retaking possession of the Premises and the Tenant hereby releases the Landlord from all
actions, proceedings, claims and demands whatsoever for or in respect of any such forcible entry or
any loss or damage in connection therewith or consequential thereupon;
	 
	 	(c)	 	the Landlord may relet the Premises or any part thereof for a term or terms which may be less
or greater than the balance of the Term and may grant reasonable concessions in connection
therewith; and
	 
	 	(d)	 	the Tenant shall pay to the Landlord on demand:

	 	(i)	 	rent and all other amounts payable hereunder up to the time of re-entry or to termination,
whichever shall be the later; and
	 
	 	(ii)	 	such reasonable expenses as the Landlord may incur or has incurred in connection with the
re-entering, terminating, reletting, collecting sums due or payable by the Tenant, realizing upon
assets seized, including without limitation brokerage, legal fees and disbursements on an
indemnification basis as between a solicitor and his own client, and the expenses of keeping the
Premises in good order, repairing the same and preparing them for reletting; and
	 
	 	(iii)	 	at the Landlord’s option, either of the following:

	 	(A)	 	as liquidated damages for the loss of rent and other income of the Landlord expected to be
derived from the Lease during the period which would have constituted the unexpired portion of the
Term had it not been terminated, the greater of:

	 	(I)	 	an amount determined by reducing to present worth at an assumed interest rate of ten (10%) per
cent per annum all Minimum Rent and Additional Rent to become payable during the period which would
have constituted the unexpired portion of the Term, such determination to be made by the Landlord,
who may make reasonable estimates of when any such other amounts would have become payable and may
make such other assumptions of fact as may be reasonable in the circumstances; and
	 
	 	(II)	 	an amount equal to accelerated Minimum Rent and Additional Rent for a period of six (6)
months; or

	 	(B)	 	damages on the footing of a present recovery of damages for loss of the benefit of the Lease
over its unexpired Term, without any requirement in law or in equity imposed upon the Landlord to
notify the Tenant prior to, concurrently with, or at any time following the exercise of the option
of the Landlord to terminate this Lease that the Landlord intends to claim such damages from the
Tenant.

16.7 No Waiver

        No provision of this Lease shall be deemed to have been waived by the Landlord unless a written
waiver from the Landlord has first
been obtained and, without limiting the generality of the foregoing, no acceptance of rent
subsequent to any default and no condoning, excusing or overlooking by the Landlord on previous
occasions of any default nor any earlier written waiver shall be taken to operate as a waiver by
the Landlord or in any way to defeat or affect the rights and remedies of the Landlord.

 

19

16.8 Remedies Cumulative 

          No reference to or exercise of any specific right or remedy by the Landlord shall
prejudice or preclude the Landlord from any other remedy, whether allowed at law or in equity or expressly
provided for herein. No such remedy shall be exclusive or dependent upon any other such remedy, but
the Landlord may from time to time exercise any one (1) or more of such remedies independently or
in combination. Without limiting the generality of the foregoing, the Landlord shall be entitled to
commence and maintain an action against the Tenant to collect any rent not paid when due, without
exercising the option to terminate this Lease.

16.9 For Lease Signs

          The Landlord shall have the right within six (6) months prior to the expiration of the Term to
place upon the Premises a notice, of reasonable dimensions and reasonably placed so as not to
interfere with the business of the Tenant, stating mat that Premises are to let and the Tenant shall
not remove or obscure such notice or permit the same to be removed or obscured.

16.10 Holding Over

          If the Tenant continues to occupy the Premises with the written consent of the Landlord after the
expiration or other termination of the Term, then, without any
further written agreement, the Tenant
shall be a tenant from month to month at the aggregate of:

	 	(a)	 	a minimum monthly rent equal to one hundred and twenty (120%) per cent of the monthly Minimum
Rent prevailing immediately prior to expiration or termination;
	 
	 	(b)	 	Additional Rent as herein provided.

and subject always to all of the other provisions in this Lease insofar as the same are applicable
to a month to month tenancy and a tenancy from year to year shall not be created by implication of
law; provided that if the Tenant continues to occupy the Premises without the written consent of
the Landlord at the expiration or other termination of the Term, then the Tenant shall be a tenant
at will and shall pay to the Landlord, as liquidated damages and not as rent, an amount equal to
the aggregate set forth above during the period of such occupancy, accruing from day to day and
adjusted pro rata accordingly and subject always to all of the other provisions of this Lease
insofar as they are applicable to a tenancy at sufferance and a tenancy from month to month or
from year to year shall not be created by implication of law; provided that nothing herein
contained shall preclude the Landlord from taking action for recovery of possession of the
Premises.

16.11 Failure to Pay 

          Should the Tenant fail to make any payment required by the Tenant pursuant to this Lease, the
Landlord may, without prejudice to any other right or remedy of the Landlord, pay all or part of
such required payment without prior notice to the Tenant and recover such payment from the Tenant as
Additional Rent.

16.12 Charge on Personal Property

          As security for the payment and performance of all debts, dues and obligations of the Tenant under
this Lease the Tenant hereby grants in favour of the Landlord a fixed and paramount mortgage and
charge and grants to the Landlord a Security Interest in all present and after-acquired goods,
stock-in-trade, inventory, fixtures, equipment, chattels and facilities of the Tenant now or
hereafter located on the Premises and the said goods, stock-in-trade, inventory, fixtures,
equipment, chattels or facilities shall not be removed by the Tenant other than in the ordinary
course of business unless permitted in writing by the Landlord. The provisions of this Article and
the mortgage and charge hereby conferred shall survive expiration of the Term or earlier
termination of this Lease.

 

20

ARTICLE 17 — GENERAL PROVISIONS

17.1 Approvals

        No provision in this Lease requiring the Landlord’s consent or approval shall be deemed to have
been fulfilled or waived unless the written consent or approval of the Landlord relating to the
particular matter or instance has first been obtained and, without limiting the generality of the
foregoing, no prior consent or approval and no condoning, excusing or overlooking by the Landlord
on previous occasions when such a consent or approval was required shall be taken to operate as a
waiver of the necessity of such consent or approval whenever required under this Lease.

17.2 Landlord’s Performance 

        Notwithstanding anything in this Lease to the contrary, the Landlord shall not be deemed to be in
default in respect of the performance of any of the terms, covenants and conditions of this Lease
if any failure or delay in such performance is due to any strike, lockout, civil commotion,
war-like operation, invasion, rebellion, hostillities, military or usurped power, sabotage,
governmental regulations or controls, act of God, or other cause beyond the control of the
Landlord.

17.3
Relationship of Parties

        Nothing contained herein shall be deemed or construed by the parties hereto, nor by any third
party, as creating the relationship of principal and agent or of partnership or of joint venture
between the parties hereto, it being understood and agreed that neither the method of computation
of rent nor any other provision contained herein, nor any acts of the parties herein, shall be
deemed to create any relationship between the parties other than the relationship of landlord and
tenant.

17.4 Sole Agreement and Survival of Agreement to Lease

        This
Lease and any agreement to lease pertaining to the Premises executed and delivered by or on
behalf of the Landlord and the Tenant set forth all of the warranties, representations, covenants,
promises, agreements, conditions and understandings between the parties concerning the Premises and
there are no warranties, representations, covenants, promises, agreements, conditions or
understandings, either oral or written, express or implied, between them other than as set forth in
this Lease, or the said agreement to lease. The provisions of the said agreement to lease shall
survive the execution and delivery of this Lease, provided that such provisions shall be deemed to
be, and survive only as, covenants and not conditions and provided further that in the event of any
conflict or contradiction between this Lease and the said agreement to lease, the provisions of
this Lease shall prevail.

17.5 Modifications 

        Except as herein otherwise provided, no subsequent alteration, amendment, change or addition to
this Lease shall be binding upon the parties unless reduced to writing and signed by the parties.
At the request of the Landlord, the Tenant shall execute and deliver a modification agreement
reflecting the changes in this Lease resulting from an adjustment in Floor Area or reflecting any
other alteration, amendment, change or addition agreed to between the
parties, provided that,
notwithstanding the failure of the Tenant to do so, the Tenant shall be bound thereby.

17.6 No Brokerage Commission

        As part of the consideration for the granting of this Lease, the Tenant represents and warrants to
the Landlord that no broker or agent (other than any broker or agent authorized in writing by the
Landlord) negotiated or was instrumental in negotiating or consummating this Lease. Notwithstanding
the foregoing, any broker or agent of the Tenant shall be paid by the Tenant to the exoneration of
the Landlord.

 

21

17.7 Registration 

        Neither the Tenant nor anyone on the Tenant’s behalf or claiming under the Tenant shall register
this Lease or any permitted assignment or permitted sublease of this Lease against the Lands or any
part thereof comprising the Premises.

17.8 Construed Covenant, Severability

        All of the provisions of this Lease are to be construed as covenants and agreements. Should any
provision of this Lease be or become illegal, invalid or not enforceable, it shall be considered
separate and severable from this Lease and the remaining provisions shall remain in force and be
binding upon the parties hereto and be enforceable to the fullest extent of the law.

17.9 Further Assurances 

        The parties hereto and each of them do hereby covenant and agree to do such things and execute such
further documents, agreements and assurances as may be necessary or advisable from time to time in
order to carry out the terms and conditions of this Agreement in accordance with their true intent.

17.10 Governing Law

          This
Agreement shall be governed in accordance with the laws of the Province of Alberta and the
parties hereto submit to such jurisdiction.

17.11 Time 

          Time shall be of the essence hereof.

17.12 Notices 

          Any notice required to be given hereunder by any party shall be deemed to have been well and
sufficiently given if:

	 	(a)	 	personally delivered to the party to whom it is intended or if such party is a corporation to
an officer of that corporation; or
	 
	 	(b)	 	mailed by prepaid registered mail, transmitted by facsimile or delivered, to the address or
facsimile number of the party to whom it is intended as follows:

	 	(i)	 	if to the Landlord, at the address or number set forth in Section l.l(a)(ii);
	 
	 	(ii)	 	if to the Tenant, to the Premises or to the address or number set forth in Section l.l(b)(ii);

        or to such other address or number as a party may from time to time direct in writing.

Any notice delivered before 4:30 p.m. local time on a Business Day shall be deemed to have been
received on the date of delivery and any notice delivered after 4:30 p.m. local time on a Business
Day or delivered on a day other than a Business Day, shall be deemed to have been received on the
next Business Day. Any notice mailed shall be deemed to have been received seventy two (72) hours
after the date it is postmarked. Any notice sent by facsimile before 4:30 p.m. local time on a
Business Day shall be deemed to have been received when the sender receives the answer back
confirming receipt by the recipient; provided, however, that any facsimile received after 4:30 p.m.
local time on a Business Day or received on a day other than a Business Day shall be deemed to
have been received on the next Business Day. If normal mail or communications service is
interrupted by strike, slow-down, force majeure or other cause after the notice has been sent the
notice will not be deemed to have been received until actually

 

22

received. In the event normal mail service is impaired at the time of sending the notice, then
personal delivery or facsimile transmission only shall be effective.

17.13 Extended Meanings

          “Hereof”, “herein”, “hereunder” and similar expressions used anywhere in this Lease relate to the
whole of this Lease and not to any particular section or subsection, unless otherwise expressly
provided. The use of the neuter singular pronoun to refer to the Landlord or the Tenant is deemed a
proper reference even though the Landlord or the Tenant is an individual, partnership, corporation
or a group of two (2) or more individuals, partnerships or corporations. The necessary grammatical
changes required to make the provisions of this Lease apply in the
plural sense where there is more
than one (1) landlord or tenant and to either corporations, associations, partnerships or
individuals, males or females, shall in all instances be assumed as though in each case fully
expressed.

17.14 No Transfer on Bankruptcy

          Neither this Lease nor any interest of the Tenant herein nor any estate hereby created will pass or
enure to the benefit of any trustee in bankruptcy or any receiver or any assignee for the benefit
of creditors of the Tenant or otherwise by operation of law.

17.15 Successors Bound 

          All rights and liabilities herein given to, or imposed upon, the respective parties hereto shall
extend to and bind the several respective heirs, executors, administrators, successors and assigns
of the said parties and if there is more than one (1) party described in Section 1.l(b), they shall
all be bound jointly and severally by the terms, covenants and
agreements herein on the part of the
Tenant. No rights, however shall enure to the benefit of any assignee
of the Tenant unless the
assignment to such assignee has been first approved by the Landlord. All covenants, agreements,
stipulations, obligations and other provisions of this Lease to be observed, performed and kept by
the Tenant shall run with the land and therefore be enforceable by all the successors of the
Landlord.

17.16
Index and Headings

          The index and headings in this Lease have been inserted for reference and as a matter of
convenience only and in no way define, limit or enlarge the scope or meaning of this Lease or any
provisions hereof.

17.17 Tenant’s Acceptance

          The Tenant hereby accepts this Lease of the Premises, to be held by the Tenant, subject to the

 

23

conditions, restrictions and covenants set forth herein.

     IN WITNESS WHEREOF the parties
hereto have executed this Lease as of the day and year first
above written.

	 	 	 	 	 	 	 
	 	 	NAR GROUP HOLDINGS LTD.	 	 
	 
	 	 	 	 	 	 
	 

	 	Per:
	 	/s/ [ILLEGIBLE]	 	 
	 

	 	 	 	 

	 	 
	 

	 	Per:
	 	/s/ [ILLEGIBLE]	 	 
	 

	 	 	 	 

	 	 
	 
	 	 	 	 	 	 
	 	 	NORTH AMERICAN CONSTRUCTION GROUP INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	Per:
	 	/s/ [ILLEGIBLE]	 	 
	 

	 	 	 	 

	 	 
	 

	 	Per:
	 	/s/ [ILLEGIBLE]	 	 
	 

	 	 	 	 

	 	 

 

 

SCHEDULE “B” TO THE

LEASE AMENDMENT AND CONSENT AGREEMENT

BETWEEN

ACHESON PROPERTIES LTD.

AND

NORTH AMERICAN CONSTRUCTION GROUP INC.

Renewal Lease re: Spruce Grove Premises

 

 

Schedule “B”

          RENEWAL LEASE AGREEMENT made this 1st day of December, 2002 BETWEEN:

NORAMA INC.

(hereinafter called “the Landlord”)

OF THE FIRST PART

— and —

NORTH AMERICAN CONSTRUCTION GROUP INC.

(hereinafter called “the Tenant”)

OF THE SECOND PART

          WHEREAS by a Lease dated the 1st day of December, 1997 (the “Original Lease”) the Landlord
(formerly named NAR Group Holdings Ltd.) granted to the Tenant a Lease demising the premises
located at #2, 53016 Hwy. 60, Spruce Grove, Alberta T7X 3G7 (the “Premises”) and more particularly
described in the Original Lease for a term of Five (5) years commencing the 1st day of December,
1997 and ending on the 30th day of November, 2002, and subject to the covenants and conditions
contained therein;

          AND WHEREAS the Tenant has requested the Landlord to grant a lease to him of the Premises for a
further term of Five (5) years from December 1st, 2002 until November 30, 2007 on the
terms hereinafter set forth which the Landlord has agreed to do;

          NOW THEREFORE the parties covenant and agree as follows:

1. The Landlord hereby demises to the Tenant the Premises subject to the covenants, terms and
conditions of the Original Lease except as amended herein.

2. The Landlord and Tenant hereby covenant that they shall perform and observe the covenants,
provisos and stipulations in the Original Lease as fully as if such covenants, provisos and

 

 

2

stipulations had been repeated in this Lease in full with such modifications only as are necessary
to make them applicable to this Renewal Lease together with such modifications as are set out
herein.

3. Article 1 — (e), (i) and (ii) are hereby
amended to extend the term of the Original Lease for a
further Five (5) years, with the Commencement Date being December 1, 2002.

4. Article 1 — (f)—Minimum Rent is hereby amended
 to reflect the agreed upon amount   per
annum of $600,000.00 by equal consecutive
monthly instalments of $50,000.00.

5. The name of the Landlord in the Original Lease shall be amended to
reflect the amalgamation
between NAR Group Holdings Ltd. and Norama Inc., which corporations now continue under the name of
NORAMA INC.

6. Except as amended, the Original Lease is hereby affirmed and ratified.

          IN WITNESS WHEREOF the parties hereto have executed this Renewal Lease as of
the day and year first above written.

	 	 	 	 	 	 	 
	 	 	NORAMA INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	Per:
	 	/s/ [ILLEGIBLE]	 	 
	 

	 	 	 	 

	 	 
	 

	 	Per:
	 	/s/ [ILLEGIBLE]	 	 
	 

	 	 	 	 

	 	 
	 
	 	 	 	 	 	 
	 	 	NORTH AMERICAN CONSTRUCTION GROUP INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	Per:
	 	/s/ [ILLEGIBLE]	 	 
	 

	 	 	 	 

	 	 
	 

	 	Per:
	 	/s/ [ILLEGIBLE]	 	 
	 

	 	 	 	 

	 	 

 

 

SCHEDULE “B”

Legal Descriptions:

	1.	 	Plan 751620

Lot. 3

Excepting thereout all mines and minerals

	 
	2.	 	Meridian 4 Range 26 Township 53

Section 4

Quarter North East

All that portion described as follows:

Commencing at a point on the southerly limit of the station

grounds of the Grand Trunk Pacific Railway as shown on

Railway Plan 6267R 396 Feet

West of the east boundary of the said Quarter Section measured

along the said southerly limit thence westerly along the

said southerly limit 451 feet;

Thence southerly and at right angles to the said southerly

limit 89 feet; thence easterly and parallel to

the said southerly limit 451

feet; thence northerly to the point of commencement,

containing .372 hectares (0.95 of an acre) more or less

Excepting thereout all mines and minerals.

	 
	3.	 	Meridian 4 Range 26 Township 53

Section 4

Quarter North East

All that portion lying south of the southerly limit of the station

grounds of the Grand Trunk Pacific Railway as shown on Railway Plan

6267R containing 19.32 hectares (47.78 acres) more or less

Excepting thereout:               Hectares               (Acres) more or less

A) All that portion described as Follows:

Commencing at the intersection of the east boundary of the said

Quarater Section with the southerly limit of the said station grounds

thence westerly along the said southerly limit 847 feet,

thence southerly and at right angles to the said southerly limit 89 feet,

thence easterly and parallel to the said southerly limit of the station

grounds to the easterly boundary of the Quarter, thence

northerly along the said east boundary to the point of commencement

	 	 	 	 	 	 	 	 	 
	Containing
	 	 	0.692	 	 	 	1.71	 
	B) Plan 7521459 Road
	 	 	0.376	 	 	 	0.93	 
	C) Plan 7521620 Subdivision
	 	 	 3.04	 	 	 	7.53	 
	D) Plan 9720886 Railway
	 	 	0.546	 	 	 	1.35	 

	 	 	Excepting thereout all mines and minerals

 

 

- 2 -

	4.	 	Plan 7620002

All that portion taken for extra right of way

Containing 6.058 hectares (14.97 acres) more or less

Excepting thereout:

	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	Hectares
	 	(Acres) more or less

	 

	  A) Plan 9720886 Railway
	 	 	3.135	 	 	 	7.75	 

	 	 	Excepting thereout all mines and minerals

 

 

SCHEDULE “C” TO THE

LEASE AMENDMENT AND CONSENT AGREEMENT

BETWEEN

ACHESON PROPERTIES LTD.

AND

NORTH AMERICAN CONSTRUCTION GROUP INC.

Legal Description of the Premises

First:

Plan 7521620

Lot 3

Excepting thereout all mines and minerals

Second:

Plan 7620002

All that portion taken for extra right of way

Containing 6.058 hectares (14.97 acres) more or less

	 	 	 	 	 	 	 	 	 	 	 
	 
	 	Excepting thereout:	 	Hectares	 	(Acres) more or less
	 
	 	(a) Plan 9720886 Railway 	 	3.135	 	 	    7.75	 
	 
	 	Excepting thereout all mines and minerals	 	 	 	 

Third:

Descriptive Plan 9921104

Block 6

Lot 16

Excepting thereout all mines and minerals

Area: 15.09 hectares (37.29 acres) more or less

 

 

ASSIGNMENT OF LEASES

THIS ASSIGNMENT OF LEASES made the 1 day of April, 2003 to be effective April 1st, 2003.

BETWEEN:

NORAMA INC.

a body corporate with an office at

#2 — 53016 — Hwy 60, Acheson Industrial Park

Spruce Grove, Alberta T7X 3G1

(the “Assignor”)

OF THE FIRST PART

— and —

ACHESON PROPERTIES LTD.

a body corporate with an office at

#2 — 53016 — Hwy 60, Acheson Industrial Park

Spruce Grove, Alberta T7X 3G1

(the “Assignee”)

OF THE SECOND PART

WHEREAS:

1. The Assignor owns and is possessed of, or is otherwise entitled to all those several interests
as owner of the lands described in the annexed First Schedule;

2. AND WHEREAS the lands are subject to a lease and Renewal Lease Agreement in favour of the
tenants all as more particularly described in the Second Schedule.

     NOW THEREFORE THIS AGREEMENT WITNESSETH that in consideration of the premises and the sum of Ten
($10.00) Dollars and other good and valuable consideration paid, by the Assignee to the Assignor,
the receipt and sufficiency being acknowledged, the parties hereto agree as follows:

 

 

2

1. The Assignor hereby grants, assigns, transfers and sets over unto the Assignee, its
successors and assigns absolutely the said leases and all renewals thereof, all rents payable
thereunder and all other benefits and advantages whatsoever to be derived therefrom TO HAVE AND TO
HOLD the same unto the Assignee, its successors and assigns forever.

2. The Assignee agrees with the Assignor that from and after April 1st, 2003
(“the effective date”) it and those deriving title under it will during the continuance of the
terms created by the leases perform and observe the covenants on the landlord’s part contained
therein.

3. The Assignor does hereby and will at all times indemnify and save harmless the Assignee
from and against any and all actions, proceedings, claims, demands, damages or costs of all or any
kind whatsoever arising directly or indirectly from any breach of the said leases by the Assignor,
its agents and employees at any time before the effective date.

4. The Assignee does hereby and will at all times indemnify and save harmless
the Assignor
from and against all and any actions, proceedings, claims, demands, damages or costs of all or any
kind whatsoever arising directly or indirectly from any breach of the said leases by the Assignee,
its agents or employees at any time from and after the effective date.

     IN WITNESS WHEREOF the parties hereto have executed these presents the day and year first above
written.

	 	 	 	 	 	 	 
	 	 	NORAMA INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	Per:	 	/s/ [ILLEGIBLE]	 	 
	 

	 	 	 	 

	 	 
	 
	 	 	 	 	 	 
	 	 	ACHESON PROPERTIES LTD.	 	 
	 
	 	 	 	 	 	 
	 

	 	Per:	 	/s/ [ILLEGIBLE]	 	 
	 

	 	 	 	 

	 	 

 

FIRST SCHEDULE

Legal Descriptions:

	1.	 	Plan 751620

Lot 3

Excepting thereout all mines and minerals
	 
	2.	 	Meridian 4 Range 26 Township 53

Section 4

Quarter North East

All that portion described as follows:

Commencing at a point on the southerly limit of the station

grounds of the Grand Trunk Pacific Railway as shown on

Railway Plan 6267R 396 Feet

West of the east boundary of the said Quarter Section measured

along the said southerly limit thence westerly along the

said southerly limit 451 feet;

Thence southerly and at right angles to the said southerly

limit 89 feet; thence easterly and parallel to

the said southerly limit 451

feet; thence northerly to the point of commencement,

containing .372 hectares (0.95 of an acre) more or less

Excepting thereout all mines and minerals.
	 
	3.	 	Meridian 4 Range 26 Township 53

Section 4

Quarter North East

All that portion lying south of the southerly limit of the station

grounds of the Grand Trunk Pacific Railway as shown on Railway Plan

6267R containing 19.32 hectares (47.78 acres) more or less

Excepting thereout:           Hectares      (Acres) more or less

A) All that portion described as follows:

Commencing at the intersection of the east boundary of the said

Quarater Section with the southerly limit of the said station grounds

thence westerly along the said southerly limit 847 feet,

thence southerly and at right angles to the said southerly limit 89 feet,

thence easterly and parallel to the said southerly limit of the station

grounds to the easterly boundary of the Quarter, thence

northerly along the said east boundary to the point of commencement

	 	 	 	 	 	 	 	 	 
	Containing.	 	 	0.692	 	 	 	1.71	 
	B) Plan 7521459 Road
	 	 	0.376	 	 	 	0.93	 
	C) Plan 7521620 Subdivision
	 	 	3.04	 	 	 	7.53	 
	D) Plan 9720886 Railway
	 	 	0.546	 	 	 	1.35	 

	 	 	Excepting thereout all mines and minerals
	 
	4.	 	Plan 7620002

All that portion taken for extra right of way

Containing 6.058 hectares (14.97 acres) more or less

Excepting thereout:

	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	Hectares
	 	(Acres) more or less

	 

	  A) Plan 9720886 Railway
	 	 	3.135	 	 	 	7.75	 

	 	 	Excenting thereout all mines and minerals

 

 

SECOND SCHEDULE

	 	 	 	 	 
	TENANT	 	 	 	COMMENCEMENT
	North American Construction
Group Inc.

	 	#2, 53016 Hwy. 60

Spruce Grove, AB.

T7X 3G7
	 	Lease dated the 1st

day of December, 1997
	 
	 	 	 	 
	North American Construction
Group Inc.

	 	#2, 53016 Hwy. 60

Spruce Grove, AB.

T7X 3G7
	 	Renewal Lease Agreement

dated the 1st day of

December, 2002

 

 

April     , 2003

 

NORAMA INC.

— and —

ACHESON PROPERTIES LTD.

 

ASSIGNMENT OF LEASES

 

HENNING BYRNE WHITMORE & McKALL

Barristers & Solicitors

1450, 10405 Jasper Avenue

Edmonton, Alberta

T5J 3N4

File No: 75.2582exv10w15

 

Exhibit
10.15

L E A S E

          THIS
LEASE, dated March 15, 2003, is made and entered into by the Landlord and Tenant
named herein who, in consideration of the covenants herein contained, agree as follows:

ARTICLE I — BASIC TERMS, SCHEDULES, DEFINITIONS 

	1.1	 	Basic Terms

	 	 	 	 	 	 	 
	 

	 	(a)
	 	(i)
	 	Landlord: ACHESON PROPERTIES LTD.
	 
	 	 	 	 	 	 
	 

	 	 	 	(ii)
	 	Address of Landlord:
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	#2, 53016 - Hwy. 60
	 

	 	 	 	 	 	Acheson Industrial Park
	 

	 	 	 	 	 	Spruce Grove Alberta T7X 3G7
	 
	 	 	 	 	 	 
	 

	 	(b)
	 	(i)
	 	Tenant: NORTH AMERICAN CONSTRUCTION GROUP INC.
	 
	 	 	 	 	 	 
	 

	 	 	 	(ii)
	 	Address of Tenant:
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	#2, 53016 - Hwy. 60
	 

	 	 	 	 	 	Acheson Industrial Park
	 

	 	 	 	 	 	Spruce Grove Alberta T7X 3G7
	 
	 	 	 	 	 	 
	 

	 	(c)
	 	 	 	Address of Premises:
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	2010 Industrial Drive
	 

	 	 	 	 	 	Sherwood Industrial Park
	 

	 	 	 	 	 	Regina, Saskatchewans
	 
	 	 	 	 	 	 
	 	 	(d)     Legal Description: Lot 5, Block S, Plan 79R05960 Extension 0
	 

	 	 	 	 	 	Surface Parcel 110859565

	 
	 	 	 	 	 	 
	 

	 	(e)
	 	(i)
	 	Term: 5 years
	 
	 	 	 	 	 	 
	 

	 	 	 	(ii)
	 	Commencement Date: March 15, 2003
	 
	 	 	 	 	 	 
	 	 	(f)     Minimum Rent: $3,000.00 per month

	 	 	 	 	 
	Lease Years	 	$/Annum	 	$/Month
	 
	 	 	 	 
	5
	 	$36,000.00	 	$3,000.00
	 
	 	 	 	per month

	 	 	 	 	 
	 

	 	(g)
	 	Permitted Use of Premises: Administration and operation of construction
company, including repair and maintenance of heavy equipment.

 

 

          The foregoing Basic Terms are hereby approved by the parties and each reference in this
Lease to any of the Basic Terms shall be construed to include the provisions set forth above as
well as all of the additional terms and conditions of the applicable sections of this Lease where
such Basic Terms are more fully set forth.

	1.2	 	Schedules
	 
	 	 	All schedules to this Lease are incorporated into and form an integral part of this Lease.
	 
	1.3	 	Definitions
	 
	 	 	In this Lease, the words, phrases and expressions set forth in Schedule “B” are used
with the meanings defined therein.

ARTICLE 2 — GRANT OF LEASE

	2.1	 	Demise

          The Landlord, being registered as owner of the Premises legally described in Section
1.1(d), subject, however, to such mortgages and encumbrances as are registered against title
thereto as of the date hereof, does hereby lease to the Tenant, for the Term and upon and subject
to the covenants and conditions hereinafter expressed, the Premises indicated on Schedule “A”
hereto.

ARTICLE 3 — TERM, COMMENCEMENT, RENEWAL

	3.1	 	Term

          The Term of this Lease shall be for the period set out in Section 1.1(e)(i), beginning
on the Commencement Date.

ARTICLE 4 — RENT 

	4.1	 	Minimum Rent

          The Tenant shall pay to the Landlord in and for each Lease Year, Minimum Rent in the
amount per annum set out in Section 1.1(f) for the respective Lease Year, by equal consecutive
monthly instalments in the amount set out in Section 1.1(f) for such Lease Year.

	4.2	 	Payment of Minimum Rent

          The first monthly instalment of Minimum Rent shall be paid on or before the
Commencement Date and subsequent instalments of Minimum Rent shall be paid strictly in advance on
the 15th day of each and every succeeding month throughout the Term.

	4.3	 	Pro Rata Adjustment of Rent

     All rent shall be deemed to accrue from day to day, and if for any reason it shall
become necessary to calculate rent for irregular periods of less than one (1) year or one (1)
month, as the case may be, an appropriate pro rata adjustment shall be made in order to calculate
rent for such irregular period.

 

 

	4.4	 	Payments Generally

          All payments by the Tenant to the Landlord of whatsoever nature required or
contemplated by this Lease shall be:

	 	(a)	 	paid to the Landlord by the Tenant in lawful currency of Canada;
	 
	 	(b)	 	made when due hereunder, without prior demand therefor and without any set-off, compensation or deduction whatsoever, at the office of the Landlord at the Premises
or such other place as the Landlord may designate from time to time to the Tenant;
	 
	 	(c)	 	applied towards amounts then outstanding hereunder, in such manner as the
Landlord may,
in its discretion, see fit, and without restricting the generality of the foregoing,
no
acceptance by the Landlord of any amount less than the full sum which is due and
owing by
the Tenant shall constitute an accord and satisfaction or oblige the Landlord to
accept in
full settlement, anything less than the full amount owing and outstanding at any
time;
	 
	 	(d)	 	deemed to be rent, in partial consideration for which this Lease has been
entered into, and
shall be payable and recoverable as rent, such that the Landlord shall have all
rights and
remedies against the Tenant for default in making any such payment which may not be
expressly said to be rent as the Landlord has for default in payment of rent; and
	 
	 	(e)	 	subject to an overdue charge if any such payment is not made when due, which
charge shall
be Additional Rent equal to the then existing Bank of Canada Prime Rate plus five (5%)
per cent per annum on the overdue amount both before and after judgment payable with the
next monthly instalment of Minimum Rent, all without prejudice to any other right or
remedy of the Landlord.

	4.5	 	Security Deposit

          The Tenant shall pay the Security Deposit to the Landlord which shall be retained by
the Landlord without liability for interest thereon, as security for the due performance by the
Tenant of its obligations under this Lease. The Security Deposit may be applied, in the Landlord’s
discretion, to remedy any default by the Tenant hereunder, whether in respect to the payment of
monies or otherwise, and in the absence of such default the Landlord shall return the Security
Deposit to the Tenant at the expiration of the Term. If any or all of the Security Deposit is
applied by the Landlord to remedy any default, then the Tenant shall forthwith upon written demand
from the Landlord, remit to the Landlord such monies as are sufficient to restore the amount of
money held on deposit by the Landlord to the original balance.

ARTICLE 5 — ADDITIONAL RENT 

	5.1	 	Intent of Lease

          It is the intent of the parties and agreed that this Lease shall be absolutely net to
the Landlord such that, without limiting the generality of the foregoing, the Tenant shall pay for
its own account, and without any variation, set-off or deduction, all amounts, charges, costs,
duties, expenses, fees, rates, sums, taxes and increases therein in any way relating to the
Premises as well as a share of the expenses relating to the operation of the Premises as set out
in this Lease.

5.2 Additional Rent

          Without limiting the generality of the preceding Section, the Tenant shall pay to the
Landlord as Additional Rent in each Lease Year the aggregate of:

 

 

	 	(a)	 	the Property Taxes;
	 
	 	(b)	 	the Operating Costs;
	 
	 	(c)	 	the Sales Tax;
	 
	 	(d)	 	such other amounts, charges, costs, sums or increases therein as are required
to be paid by the Tenant to the Landlord pursuant to this Lease in addition to Minimum Rent.

	5.3	 	Estimate of Additional Rent

          The Landlord may, in respect of any or all of the items of Additional Rent, compute bona fide
estimates of the amounts which are anticipated to accrue in the next following Lease Year,
calendar year or fiscal year, or portion thereof, as the Landlord in its discretion may determine
is the most appropriate period for each or all items of Additional Rent, and the Landlord may
provide the Tenant with written notice of the amount of any such estimate.

	5.4	 	Payment of Additional Rent

          With respect to any item of Additional Rent which the Landlord elects to estimate from
time to time, following receipt of the written notice of the estimated amount thereof, the Tenant
shall pay to the Landlord such amount, in equal consecutive monthly instalments throughout the
applicable period with the monthly instalments of Minimum Rent. With respect to any item of
Additional Rent which the Landlord has not elected to estimate from time to time, the Tenant shall
pay to the Landlord the amount of such item of Additional Rent, determined pursuant to the
applicable provisions of this Lease, forthwith upon receipt of an invoice therefor.

	5.5	 	Adjustment of Additional Rent

          Within ninety (90) days of the end of each Lease Year, calendar year or fiscal year, or
portion thereof, as the case may be, for which the Landlord has estimated any item of Additional
Rent, the Landlord shall compute the actual amount of such item of Additional Rent, and make
available to the Tenant for examination a statement of the gross amount of such item of Additional
Rent, and the calculation of the Tenant’s share thereof for each year or portion thereof. If the
actual amount of such item of Additional Rent, as set out in any such statement, exceeds the
aggregate amount of the instalments paid by the Tenant in respect of such item, the Tenant shall
pay to the Landlord the amount of the excess within fifteen (15) days of the receipt of such
statement. If the contrary is the case, any such statement shall be accompanied by a refund to the
Tenant of any such overpayment without interest, provided that the Landlord may first deduct from
such refund any rent or other sum which is then owing by the Tenant or in arrears.

	5.6	 	Review of Additional Rent

          No party hereto may claim a readjustment in respect of any item of Additional Rent
whether paid or payable in instalments or otherwise, if based on any error of estimation,
allocation, calculation or computation thereof, unless claimed in writing prior to the expiration
of one (1) year from the conclusion of the period in respect of which such item of Additional Rent
accrued.

ARTICLE 6 — TAXES

	6.1	 	Tenant’s Taxes

          The Tenant shall pay promptly when due all business, sales, machinery,
equipment and all

 

 

other taxes, assessments, charges and rates, as well as any permit or license fees,
attributable to the Premises or the property, business, sales or income of the Tenant in respect of
the Premises.

	6.2	 	 Payment of Property Taxes

          The Tenant shall pay to the Landlord as Additional Rent the Property Taxes.

	6.3	 	Increases in Property Taxes

          The Tenant shall pay to the Landlord as Additional Rent an amount equal to any increase
in the Property Taxes by reason of any installation, alteration or use made in or to the Premises
by or for the benefit of the Tenant or any assignee, concessionaire, licensee or subtenant of the
Tenant.

	6.4	 	Sales Tax

          The Tenant shall pay to the Landlord as Additional Rent, or as otherwise required by law, all
Sales Tax. The Landlord shall determine on a reasonable basis the extent to which the Sales Tax is
imposed by reason of any sum payable by the Tenant to the Landlord pursuant to any provisions of
this Lease and any report of the Landlord’s chartered accountant for such purpose shall be
conclusive as to the amount of any Sales Tax for any period to which such report relates.

ARTICLE 7 —  OPERATING COSTS

	7.1	 	 Payment of Operating Costs

          The Tenant shall pay to the Landlord as Additional Rent the Operating Costs.

	7.2	 	Increases in Costs

          The Tenant shall not do or omit, or permit to be done or omitted, upon or about the
Premises, anything which shall cause the Operating Costs to be increased. If the Operating Costs
shall be so increased, the Tenant shall pay to the Landlord as Additional Rent the amount of such
increase.

ARTICLE 8 — UTILITIES, HVAC COSTS 

	8.1	 	Tenant’s Utilities

          The Tenant shall pay all rates, charges, costs and expenses as may be assessed or levied
and at the rates so assessed or levied by all suppliers of utilities directly to the Premises.

ARTICLE 9 — INSURANCE 

	9.1	 	Tenant’s Insurance

	 	(a)	 	The Tenant shall, during the whole of the Term and during such other time as the
Tenant occupies the Premises, take out and maintain the following insurance, at the
Tenant’s sole expense, in such form and with such companies as the Landlord may
reasonably approve:

	 	(i)	 	comprehensive general liability insurance applying to
all operations of the Tenant and against claims for bodily injury,
including death, and property damage or loss arising out of the use or
occupation of the Premises, or the Tenant’s business on or

 

 

	 	 	 	about the Premises; such insurance shall include the Landlord as an
additional insured and indemnify and protect both the Tenant and Landlord and
shall contain a “cross liability” or “severability of interests” clause so
that the Landlord and the Tenant may be insured in the same manner and to the
same extent as if individual policies had been issued to each, and shall be
for the amount of not less than One Million ($1,000,000.00) Dollars combined
single limit or such other amount as may be reasonably required by the
Landlord from time to time; such comprehensive general liability insurance
shall, for the Tenant’s benefit only, include contractual liability and
tenant’s legal liability insurance in a form and of a nature broad enough to
insure the obligations imposed upon the Tenant under the terms of this Lease;
and
	 
	 	(ii)	 	“all risks” insurance upon its merchandise, stock-in-trade,
furniture, fixtures and improvements including leasehold improvements and upon
all other property in the Premises owned by the Tenant or for which the Tenant
is legally liable, and insurance upon all glass and plate glass in the
Premises, against breakage and damage from any cause, all in an amount equal
to the full replacement value thereof, which amount in the event of a dispute
shall be determined by the decision of the Landlord.

	 	(b)	 	The policies of insurance referred to above shall contain the following:

	 	(i)	 	provisions that the Landlord is protected notwithstanding
any act, neglect or misrepresentation of the Tenant which might otherwise
result in the avoidance of a claim under such policies and such that such
policies shall not be affected or invalidated by any act, omission or
negligence of any third party which is not within the knowledge or control
of the insured(s);
	 
	 	(ii)	 	provisions that such policies and the coverage evidenced
thereby shall be primary and non-contributing with respect to any policies
carried by the Landlord and that any coverage carried by the Landlord shall
be excess coverage;
	 
	 	(iii)	 	all property insurance referred to above shall provide for
waiver of the insurer’s rights of subrogation as against the Landlord;
	 
	 	(iv)	 	provisions that such policies of insurance shall not be
cancelled without the insurer providing the Landlord with thirty (30) days
written notice stating when such cancellation shall be effective.

	 	(c)	 	Evidence satisfactory to the Landlord of all such policies of insurance shall
be provided to the Landlord upon request.
	 
	 	(d)	 	The Tenant shall further during the whole of the Term maintain such other
insurance in
such amounts and in such sums as the Landlord may reasonably determine from time to
time.

ARTICLE 10 — USE AND OCCUPATION

	10.1	 	Quiet Enjoyment

          The Landlord covenants with the Tenant for quiet enjoyment, for so long as the Tenant is not
in default hereunder, and except as provided herein.

 

 

	10.2	 	Use

          The Premises shall be used for the purpose set forth in Section 1.1(h) and for no
other purpose.

	10.3	 	Covenant to Operate

          The Tenant shall throughout the whole of the Term continuously operate, occupy and utilize
the entire Premises and conduct its business therein complying strictly with the provisions of
this Lease. The Tenant acknowledges that the Landlord is executing this Lease in reliance upon
the Tenant’s covenant herein contained and that such covenant is a material element inducing
the Landlord to execute this Lease.

	10.4	 	Compliance with Laws

          The Tenant shall carry on and conduct its business from the Premises in such manner
as to comply with any and all statutes, by-laws, rules and regulations of any Federal,
Provincial, Municipal or other competent authority for the time being in force, and shall not
do anything upon the Premises in contravention thereof.

	10.5	 	Nuisance

          The Tenant shall not do or permit to be done or omitted anything which could damage the
Premises or injure or impede the business of the Tenant or of other tenants in the Premises or
which shall or might result in any nuisance in or about the Premises, whether to the Landlord,
or any other party, the whole as determined by the Landlord, acting reasonably. In any of the
foregoing events, the Tenant shall forthwith remedy the same and if such thing or condition
shall not be so remedied, the Landlord may, after such notice, if any, as the Landlord may deem
appropriate in the circumstances, correct such situation at the expense of the Tenant and the
Tenant shall pay such expense to the Landlord as Additional Rent.

ARTICLE 11 — HAZARDOUS SUBSTANCES ON THE PREMISES

	11.1	 	Hazardous substances

          The Tenant shall not cause or permit any Hazardous Substance to be brought upon,
kept or used in or about the Premises without the prior written consent of the Landlord, which
consent shall not be unreasonably withheld if the Tenant demonstrates to the Landlord’s
reasonable satisfaction that such Hazardous Substance is reasonably necessary for the Tenant’s
permitted use of the Premises and that it will be used, kept, stored and disposed of in a
manner that complies with all Environmental Laws.

	11.2	 	Compliance with Environmental Laws

	 	(e)	 	The Tenant shall at the Tenant’s own expense comply with all Environmental
Laws and shall make, obtain and deliver all reports and studies as required by any
governmental agency, authority or any Environmental Laws.
	 
	 	(f)	 	The Tenant authorizes the Landlord to make inquiries from time to time of
any governmental agency or authority in order to determine the Tenant’s compliance with
the Environmental Laws. The Tenant covenants and agrees that it will from time to
time provide to the Landlord such written authorization as the Landlord may
reasonably require in order to facilitate the obtaining of such information.

 

 

	 	(g)	 	The Tenant shall immediately advise the Landlord of any breach of any part
of this Article or if any governmental agency or authority issues an order, notice,
cancellation, amendment, charge, violation, ticket or other document concerning the
release, investigation, clean up, remediation or abatement of any Hazardous
Substance.

	11.3	 	Clean Up or Removal

          If any government authority shall require the clean up or removal of any Hazardous
Substance held, released, spilled, abandoned or placed upon the Premises or released into the
environment by the Tenant in the course of the Tenant’s business or as a result of the Tenant’s
use or occupancy of the Premises, then the Tenant shall, at its own expense, prepare and submit
for approval all necessary studies, plans and proposals, shall provide all bonds and other
security required by governmental authorities and shall forthwith carry out the work required. The
Tenant shall keep the Landlord fully informed of the progress of the matter and shall provide to
the Landlord full information with respect to proposed plans and comply with the Landlord’s
reasonable requirements with respect to such plans. The Tenant further agrees that if the Landlord
determines, in its discretion, that the Premises, the Landlord or the Landlord’s reputation is
placed in any jeopardy by the requirements for any such work, the Landlord may itself undertake
such work or any part thereof at the cost and expense of the Tenant.

	11.4	 	Indemnity

          The Tenant shall indemnify and hold harmless the Landlord from any and all claims,
damages, fines, judgments, penalties, costs, liabilities or losses arising out of or in any way
related to any contamination of the Premises in any manner for which the Tenant is legally liable
including, without limitation, any personal injury or property damage, a decrease in value of the
Premises, damages caused by loss or restriction of rentable or useable space, or any damages caused
by adverse impact on marketing of the space, any and all sums paid for settlement of claims and any
lawyer’s, consultant’s, agent’s or expert’s fees. The provisions of this Section shall be in
addition to any other obligations and liabilities that the Tenant may have to the Landlord at law
or equity and shall survive the transactions contemplated herein and the termination of this Lease.

	11.5	 	Ownership of Hazardous substances

          If the Tenant creates or brings to the Premises any Hazardous Substances or if the
conduct of the Tenant’s business shall cause there to be any Hazardous Substance at the Premises
then, notwithstanding any rule of law to the contrary, such Hazardous Substance shall be and
remain the sole and exclusive property of the Tenant and shall not become the property of the Landlord notwithstanding the degree of affixation to the Premises of the Hazardous Substances, and
notwithstanding the expiry or earlier termination of this Lease.

ARTICLE 12 — CLEANING, REPAIR 

	12.1	 	Cleaning

	 	(a)	 	The Tenant shall keep the Premises and, without limitation, the inside and outside
of all
glass windows and doors of the Premises and all exterior surfaces of the Premises,
in a
neat, clean and sanitary condition and shall not allow any refuse, garbage or other
loose or
objectionable or waste material to accumulate in or about the Premises but rather
shall
dispose of the same.
	 
	 	(b)	 	The Tenant shall pay for its own janitorial services, cleaning of debris,
removal of garbage
and such other costs as may be incurred in cleaning in accordance with this Article.

 

 

	 	(c)	 	In the event the Tenant fails to clean in accordance with this Article
upon notice so to do from the Landlord, the Landlord may clean the same and the
Tenant shall pay to the Landlord as Additional Rent the cost thereof.

	12.2	 	Tenant’s Repairs

	 	(a)	 	The Tenant shall repair the Premises, only excepting reasonable wear and tear, but
including any damage to or breakage of glass, plate glass, shop windows, mouldings,
storefronts, signs, doors, hardware, lighting, wiring, plumbing, improvements,
partitions,
wall fixtures and all trade fixtures and furnishings of the Tenant or otherwise in
or for the
Premises and maintain in good condition the interior of the Premises, any
appurtenances
thereto, any improvements now or hereafter erected or installed therein and any
apparatus
or equipment of the Tenant therein or therefor.
	 
	 	(b)	 	The Tenant shall maintain all heating, ventilation, air-conditioning and
plumbing facilities
within the Premises and all drains therefrom in good repair and working order.
	 
	 	(c)	 	The Tenant, its employees or agents shall not mark, paint, drill or in any way
deface any walls, ceilings, partitions, floors, wood, stone or ironwork without the written approval of
the Landlord.

	12.3	 	View Repairs

          The Landlord may enter the Premises at any reasonable time during business hours and at
any time during any emergency to view the state of repair and the Tenant shall repair according to
notice in writing from the Landlord so to do, subject to the exceptions contained in this Article.

	12.4	 	Landlord may Maintain and Repair

          If the Tenant fails to maintain and repair as required herein and according to notice
from the Landlord within fourteen (14) days of receipt thereof, or such shorter period as may be
reasonable in the circumstances, the Landlord may complete such maintenance and repair without
liability to the Tenant for any loss or damage that may occur to the Tenant’s merchandise,
fixtures or other property or to the Tenant’s business by reason thereof, and upon completion
thereof, the Tenant shall pay as Additional Rent the Landlord’s cost for conducting such repairs
or maintenance.

	12.5	 	Taking of Possession

          The taking of possession of the Premises by the Tenant shall be conclusive evidence
against the Tenant, that at the time of taking possession, the Premises were in good and fully
satisfactory order and condition.

ARTICLE 13 — ALTERATIONS, FIXTURES 

	13.1	 	Tenant’s Alterations

	 	(a)	 	The Tenant shall not make or cause to be made any alterations, additions or
improvements or erect or cause to be erected any partitions or install or cause to be
installed any trade fixtures, exterior signs, floor covering, interior or exterior
lighting, plumbing fixtures, apparatus for air-conditioning, cooling, heating,
illuminating, refrigerating, or ventilating the Premises, shades, awnings, exterior
decorations or make any changes to the Premises without first obtaining the
Landlord’s written approval thereto.

 

 

	 	(b)	 	When seeking the approval of the Landlord as required by this Article, the Tenant
shall
present to the Landlord plans and specifications of the proposed work.
	 
	 	(c)	 	The Tenant shall promptly pay all contractors, material suppliers and workmen
so as to
minimize the possibility of a lien attaching to the Premises and should any claim or lien be
made or filed the Tenant shall discharge the same.

	13.2	 	Removal of Fixtures

	 	(a)	 	So long as the Tenant is not in default hereunder at the expiration of the Term,
the Tenant
shall then have the right to remove its trade fixtures from the Premises but shall
make good
any damage caused to the Premises resulting from the installation or removal
thereof;
provided that all alterations, additions and improvements constructed and installed
in the
Premises and attached in any manner to the floors, walls or ceiling, including any
floor
covering and light fixtures, are hereby deemed not to be trade fixtures and shall
remain
upon and be surrendered with the Premises, except to the extent the Landlord
requires
removal thereof.
	 
	 	(b)	 	If the Tenant fails to remove its trade fixtures and restore the Premises as
aforesaid, all such
trade fixtures shall become the property of the Landlord except to the extent that
the
Landlord continues to require removal thereof.
	 
	 	(c)	 	Should the Tenant abandon the Premises or should this Lease be terminated
before the
proper expiration of the Term due to a default on the part of the Tenant then, in
such event,
as of the moment of default by the Tenant, all trade fixtures and furnishings of the
Tenant
(whether or not attached in any manner to the Premises) shall, except to the extent
the
Landlord requires the removal thereof, become and be deemed to be the property of
the
Landlord, without indemnity to the Tenant and as additional liquidated damages in
respect
of such default but without prejudice to any other right or remedy of the Landlord.
	 
	 	(d)	 	Notwithstanding that any trade fixtures, alterations, additions, improvements
or fixtures are
or may become the property of the Landlord, the Tenant shall forthwith remove all or
part
of the same and shall make good any damage caused to the Premises resulting from the
installation or removal thereof, all at the Tenant’s expense, should the Landlord so
require
by notice to the Tenant.
	 
	 	(e)	 	If the Tenant, after receipt of a notice from the Landlord, fails to promptly
remove any
trade fixtures, furnishings, alterations, additions, improvements and fixtures in accordance
with such notice, then the Landlord may enter into the Premises and remove therefrom all
or part of such trade fixtures, furnishings, alterations, additions, improvements and fixtures
without any liability and at the expense of the Tenant, which expense shall forthwith be
paid by the Tenant to the Landlord.

	13.3	 	 Landlord’s Alterations 

          The Landlord reserves the right to:

	 	(a)	 	make alterations or additions to the structure and facilities of the Premises;

which rights may be exercised by the Landlord in its unfettered discretion and without any claim
for damages or indemnification against the Landlord, its employees or agents and without
diminution or abatement of rent except during any period of time during which the Tenant is unable
to carry on business with the public because of the exercise of such rights by the Landlord.

 

 

ARTICLE 14 — SUBSTANTIAL DAMAGE AND DESTRUCTION

	14.1	 	No Abatement

          If during the Term the Premises shall be damaged or destroyed by any cause whatsoever
such that the Premises are rendered unfit for occupancy by the Tenant, the rent hereby reserved
shall not abate in whole or part except to the extent that such rent is recovered by the Landlord
under any policies of insurance against rental loss which the Landlord may have taken out.

	14.2	 	Substantial Damage or Destruction

          In the event of Substantial Damage or Destruction of the Premises, the Landlord may
within sixty (60) days after such damage or destruction and on giving thirty (30) days written
notice to the Tenant declare this Lease terminated forthwith and in such event, the Term shall be
deemed to have expired and the Tenant shall deliver up possession of the Premises accordingly,
rent shall be apportioned and shall be payable up to the date of termination stated in such notice
and the Tenant shall be entitled to be repaid by the Landlord any rent paid in advance and
unearned or an appropriate portion thereof.

ARTICLE 15 — ASSIGNMENT, SUBLETTING, SALE 

	15.1	 	Assignment and Subletting

          The Tenant shall not assign this Lease in whole or in part, nor sublet all or any part
of the Premises, nor grant any license or part with possession of the Premises or transfer any
other right or interest under this Lease, or, if the Tenant is a corporation, cause or permit to
occur either directly or indirectly any change in its ownership or control, all without the prior
written consent of the Landlord in each instance, which consent shall not be unreasonably withheld
or delayed provided the proposed assignment or sublease or change in ownership or control complies
with the following provisions:

	 	(a)	 	notwithstanding any assignment or sublease, the Tenant shall remain fully
liable on this
Lease and shall not be released from performing any of the terms, covenants and
conditions
of this Lease;
	 
	 	(b)	 	if the Lease is assigned or if the Premises or any part thereof are sublet or
occupied by
anyone other than the Tenant, then the Landlord may collect rent directly from the
assignee, subtenant or occupant, and apply the net amount collected, or the
necessary
portion thereof, to the rent herein reserved;
	 
	 	(c)	 	no assignment or sublease shall be made or proposed other than to substantial
and
responsible persons, firms, partnerships or bodies corporate who are experienced in
and
agree to carry on the type of business conducted in the Premises by the Tenant, as
set forth
in Section 1.1(h), and who undertake in favour of the Landlord to perform and
observe the
obligations of the Tenant hereunder by entering into an assumption agreement
directly with
the Landlord;
	 
	 	(d)	 	the prohibition against assigning or subletting without the consent required by
this Article
shall be construed to include a prohibition against any assignment or sublease by
operation
of law;
	 
	 	(e)	 	the consent by the Landlord to any assignment or sublease shall not constitute
a waiver of
the necessity of such consent to any subsequent assignment or sublease.

 

 

	15.2	 	Sale by Landlord

          In the event of a sale by the Landlord of any portion or all its interest in the
Premises, the Landlord shall thereafter be entirely relieved of the performance of all terms,
covenants and obligations thereafter to be performed by the Landlord under this Lease, to the
extent of the interest or portion so sold or transferred and it shall be deemed and construed
without further agreement between the parties that the purchaser or transferee, as the case may be,
has assumed and agreed to carry out any and all covenants of the Landlord hereunder.

 ARTICLE 16 — INDEMNITY, LIENS 

	16.1	 	Tenant’s Indemnity

          The Tenant shall at all times during the Term, indemnify and save harmless the Landlord
of and from all loss and damage and all actions, claims, costs, demands, expenses, fines,
liabilities and suits of any nature whatsoever for which the Landlord shall or may become liable,
incur or suffer by reason of a breach, violation or nonperformance by the Tenant of any covenant,
term or provision hereof or by reason of any builders’ or other liens for any work done or
materials provided or services rendered for alterations, improvements or repairs to the Premises,
made by or on behalf of the Tenant, or by reason of any injury occasioned to or suffered by any
person or damage to any property, by reason of any wrongful act or omission, default or negligence
on the part of the Tenant or any of its agents, concessionaires, contractors, customers,
employees, invitees or licensees in or about the Premises.

	16.2	 	Personal Injury and Property Damage

	 	 	 	The Landlord shall not be liable or responsible for:
	 
	 	(a)	 	any personal injury or consequential damage of any nature whatsoever, however
caused,
that may be suffered or sustained by the Tenant or by any other person who may be
upon
the Premises; or
	 
	 	(b)	 	any loss or damage of any nature whatsoever, howsoever caused, to the
Premises, any
property belonging to the Tenant or to any other person while such property is in or about
the Premises.

	16.3	 	Liens

          The Tenant shall, immediately upon demand by the Landlord, remove or cause to be
removed, and thereafter institute and diligently prosecute any action pertinent thereto, any
builders’ or other lien or claim of lien noted or filed against or otherwise constituting an
encumbrance on any title of the Landlord. Without limiting the foregoing obligations of the
Tenant, the Landlord may cause the same to be removed, in which case the Tenant shall pay to the
Landlord as Additional Rent the cost thereof, including the Landlord’s complete legal costs.

	16.4	 	Granting of Security Interest

	 	(a)	 	The Tenant shall not grant a Security Interest in any goods that have become
affixed to the
Premises, and the Tenant shall not affix to the Premises any goods which are subject
to a
Security Interest.
	 
	 	(b)	 	The Tenant shall not permit any notice claiming a Security Interest in any
fixture to be
registered against title to the Premises and shall, immediately upon demand by the
Landlord, remove or cause to be removed any such notice and institute and diligently

 

 

	 	 	 	prosecute any proceedings pertinent thereto.

ARTICLE 17 — DEFAULT, REMEDIES, TERMINATION

	17.1	 	Default

	 	 	 	If and whenever:
	 
	 	(a)	 	the Tenant shall be in default in the payment of any money, whether hereby
expressly
reserved or deemed as rent, or any part thereof, and such default shall continue for
ten (10)
days following any specific due date on which the Tenant is to make such payment or,
in
the absence of such specific due date, for the ten (10) days following written notice
by the
Landlord requiring the Tenant to pay the same; or
	 
	 	(b)	 	the Tenant’s leasehold interest hereunder, or any goods, chattels or equipment
of the Tenant
located in the Premises shall be taken or seized in execution or attachment, or if
any writ of
execution shall issue against the Tenant and not be discharged within twenty-one (21)
days
of its issuance, or the Tenant shall become insolvent or commit an act of bankruptcy
or
become bankrupt or take the benefit of any Act that may be in force for bankrupt or
insolvent debtors or become involved in voluntary or involuntary winding up,
dissolution
or liquidation proceedings, or if a receiver or receiver and manager shall be
appointed for
the affairs, business, property or revenues of the Tenant; or
	 
	 	(c)	 	the Tenant shall fail to commence, diligently pursue and complete the Tenant’s
work to be
performed pursuant to any agreement to lease pertaining to the Premises or other
agreement
signed by the parties or fail to open for business when required by the provisions of
this
Lease, or vacate or abandon the Premises or fail or cease to operate pursuant to the
provisions of this Lease or otherwise cease to conduct business from the Premises, or
use or
permit or suffer the use of the Premises for any purposes other than as allowed
pursuant to
this Lease, or fail to remedy or rectify any act or omission hereunder, or if the
Tenant
should make a bulk sale of its goods and assets which has not been consented to by
the
Landlord, or move or commence, attempt or threaten to move its goods, chattels and
equipment out of the Premises other than in the routine and ordinary course of its
business;
or
	 
	 	(d)	 	the Tenant makes a sale in bulk out of the ordinary course of business of any
of its assets,
wherever situated (other than a bulk sale made to an assignee or sublessee pursuant
to a
permitted assignment or subletting hereunder and pursuant to the Bulk Sales Act of
Alberta); or
	 
	 	(e)	 	the Tenant sells or disposes of the trade fixtures, goods or chattels of the
Tenant or removes
them from the Premises so that there would not in the event of such sale or disposal
be
sufficient trade fixtures, goods or chattels of the Tenant on the Premises subject to
distress
to satisfy all rent due or accruing hereunder for a period of at least twelve (12)
months; or
	 
	 	(f)	 	the Premises become and remain vacant for a period of five (5) consecutive days
or are
used by any persons other than such as are entitled to use them hereunder; or
	 
	 	(g)	 	the Tenant assigns, transfers, encumbers, sublets or permits the occupation or
use or the
parting with or sharing possession of all or any part of the Premises by anyone
except in a
manner permitted by this Lease; or
	 
	 	(h)	 	re-entry is permitted under any other term of this Lease; or

 

 

	 	(i)	 	the Tenant fails to observe, perform or keep each and every of the
covenants, agreements, stipulations, obligations, conditions and other provisions
of this Lease to be observed, performed and kept by the Tenant and persists in
such default, in the case of monetary payments, beyond the ten (10) day period
stipulated in paragraph (a) aforesaid or, in the case of any other default, after
ten (10) days written notice from the Landlord requiring that the Tenant remedy,
correct or comply or, in the case of any such default which would reasonably
require more than ten (10) days to rectify, unless the Tenant shall commence
rectification within the said ten (10) day notice period and thereafter promptly
and diligently and continuously proceed with the rectification of any such
default;

then, and in each of such cases, and at the option of the Landlord and in addition to any
other rights or remedies the Landlord may have pursuant to this Lease or at law, the Landlord
may, immediately re-enter upon the Premises and may expel all occupants thereof and remove all
property from the Premises and such property may be removed and sold or disposed of by the
Landlord in such manner as it deems advisable, including by private sale, or may be stored in a
public warehouse or elsewhere at the cost and for the account of the Tenant, all without service
of notice or resort to legal process and without the Landlord being considered guilty of trespass
or becoming liable for any loss or damage which may be occasioned thereby. If the Landlord elects
to re-eater the Premises as herein provided, or if it takes possession pursuant to legal
proceedings or pursuant to any notice provided for by law, it may either terminate this Lease or
it may from time to time without terminating this Lease, make such alterations and repairs as are
necessary in order to relet the Premises, or any part thereof, for such term or terms (which may
be for a term extending beyond the Term) and at such rent and upon such other terms, covenants
and conditions as the Landlord in its sole discretion considers advisable.

	17.2	 	Landlord may Perform

          If the Tenant shall fail to observe, perform or keep any of the provisions of this
Lease to be observed, performed and kept by the Tenant, the Landlord may, but shall not be
obliged to, at its discretion and without prejudice to any other right, claim or action it may
have, rectify the default of the Tenant, whether or not performance by the Landlord on behalf
of the Tenant is otherwise expressly referred to in the applicable Section of this Lease. For
such purpose the Landlord may make any payment or do or cause to be done such things as may be
required including, without limiting the generality of the foregoing, entry upon the Premises.
Any such performance by or at the behest of the Landlord shall be at the expense of the Tenant
and the Tenant shall pay to the Landlord as Additional Rent the cost thereof.

	17.3	 	Distress

          If and whenever the Tenant shall be in default in the payment of any money, whether
hereby expressly reserved or deemed as rent, or any part thereof, the Landlord may, without notice
or any form of legal process whatever, enter upon the Premises and seize, remove and sell by
judicial or formal process or by private sale the Tenant’s goods, chattels and equipment
therefrom or seize, remove and sell, by judicial or formal process or by private sale, any goods,
chattels and equipment at any place to which the Tenant or any other person may have removed them,
in the same manner as if they had remained and been distrained upon the Premises, all
notwithstanding any rule of law or equity to the contrary, and the Tenant hereby waives and
renounces the benefit of any present or future statute or law limiting or eliminating the
Landlord’s right of distress or sale.

	17.4	 	Costs and Interest

          All costs, expenses and expenditures of the Landlord, incurred upon any default by
the Tenant hereunder, including, without limitation, the legal costs incurred by the Landlord
on an indemnification basis as between solicitor and his own client shall, forthwith on demand,
be paid by the Tenant to the Landlord as Additional Rent. All rent and other sums due to the
Landlord pursuant to the

 

 

terms of this Lease shall be paid by the Tenant promptly when due, and if not so paid, shall
bear interest from their respective due dates at the rate of five (5%) per cent per annum above the
then existing Bank of Canada Prime Rate, both before and after default, demand and judgment.

	17.5	 	Vacate Upon Termination, Survival

          At the termination of this Lease, whether by affluxion of time or otherwise, the Tenant
shall vacate and deliver up possession of the Premises in the same state and condition as they
where in upon delivery of possession to the Tenant, subject to the exceptions from the Tenant’s
obligation to repair and subject to the Tenant’s rights and obligations in respect of removal and
the Tenant shall thereupon surrender all keys to the Premises to the Landlord at the place then
fixed for payment of rent and shall inform the Landlord of all combinations on locks, safes and
vaults, if any, in the Premises. The indemnity agreements contained in this Lease shall survive
the termination of this Lease.

	17.6	 	Additional Rights on Re-Entry
	 
	 	 	If the Landlord shall re-enter the Premises or terminate this Lease, then:

	 	(a)	 	notwithstanding any such re-entry, termination, or the Term thereby becoming
forfeited and
void, the provisions of this Lease relating to the consequences of termination shall
survive;
	 
	 	(b)	 	the Landlord may use such force as it may deem necessary, for the purpose of
gaining admittance to and retaking possession of the Premises and the Tenant hereby releases
the
Landlord from all actions, proceedings, claims and demands whatsoever for or in
respect of
any such forcible entry or any loss or damage in connection therewith or
consequential
thereupon;
	 
	 	(c)	 	the Landlord may relet the Premises or any part thereof for a term or terms
which may be
less or greater than the balance of the Term and may grant reasonable concessions in
connection therewith; and
	 
	 	(d)	 	the Tenant shall pay to the Landlord on demand:

	 	(i)	 	rent and all other amounts payable hereunder up to the
time of re-entry or to termination, whichever shall be the later; and
	 
	 	(ii)	 	such reasonable expenses as the Landlord may incur or has
incurred in connection with the re-entering, terminating, reletting,
collecting sums due or payable by the Tenant, realizing upon assets seized,
including without limitation brokerage, legal fees and disbursements on an
indemnification basis as between a solicitor and his own client, and the
expenses of keeping the Premises in good order, repairing the same and
preparing them for reletting; and
	 
	 	(iii)	 	at the Landlord’s option, either of the following:

	 	(A)	 	as liquidated damages for the loss of rent and
other income of the Landlord expected to be derived from the Lease
during the period which would have constituted the unexpired portion
of the Term had it not been terminated, the greater of:

	 	(I)	 	an amount determined by reducing
to present worth at an assumed interest rate of ten (10%) per
cent per annum all Minimum Rent and Additional Rent to become
payable during the period which would have constituted the
unexpired portion of the Term, such

 

 

	 	 	 	determination to be made by the Landlord, who may make
reasonable estimates of when any such other amounts would
have become payable and may make such other assumptions of
fact as may be reasonable in the circumstances; and
	 
	 	(II)	 	an amount equal to
accelerated Minimum Rent and Additional Rent for a period of six
(6) months; or

	 	(B)	 	damages on the footing of a present recovery of
damages for loss of the benefit of the Lease over its unexpired Term,
without any requirement in law or in equity imposed upon the Landlord
to notify the Tenant prior to, concurrently with, or at any time
following the exercise of the option of the Landlord to terminate this
Lease that the Landlord intends to claim such damages from the Tenant.

	17.7	 	No Waiver

          No provision of this Lease shall be deemed to have been waived by the Landlord unless a
written waiver from the Landlord has first been obtained and, without limiting the generality of
the foregoing, no acceptance of rent subsequent to any default and no condoning, excusing or
overlooking by the Landlord on previous occasions of any default nor any earlier written waiver
shall be taken to operate as a waiver by the Landlord or in any way to defeat or affect the rights
and remedies of the Landlord.

	17.8	 	Remedies Cumulative

          No reference to or exercise of any specific right or remedy by the Landlord shall
prejudice or preclude the Landlord from any other remedy, whether allowed at law or in equity or
expressly provided for herein. No such remedy shall be exclusive or dependent upon any other such
remedy, but the Landlord may from time to time exercise any one (1) or more of such remedies
independently or in combination. Without limiting the generality of the foregoing, the Landlord
shall be entitled to commence and maintain an action against the Tenant to collect any rent not
paid when due, without exercising the option to terminate this Lease.

	17.9	 	Holding Over

          If the Tenant continues to occupy the Premises with the written consent of the Landlord
after the expiration or other termination of the Term, then, without any further written
agreement, the Tenant shall be a tenant from month to month at the aggregate of:

	 	(a)	 	a minimum monthly rent equal to one hundred and twenty (120%) per cent of
the monthly Minimum Rent prevailing immediately prior to expiration or termination;
	 
	 	(b)	 	Additional Rent as herein provided;

and subject always to all of the other provisions in this Lease insofar as the same are applicable
to a month to month tenancy and a tenancy from year to year shall not be created by implication of
law; provided that if the Tenant continues to occupy the Premises without the written consent of
the Landlord at the expiration or other termination of the Term, then the Tenant shall be a tenant
at will and shall pay to the Landlord, as liquidated damages and not as rent, an amount equal to
the aggregate set forth above during the period of such occupancy, accruing from day to day and
adjusted pro rata accordingly and subject always to all of the other provisions of this Lease
insofar as they are applicable to a tenancy at sufferance and a tenancy from month to month or from
year to year shall not be created by implication of law; provided that nothing herein contained
shall preclude the Landlord from taking action for recovery of possession of the Premises.

	17.10	 	Failure to Pay

 

 

          Should the Tenant fail to make any payment required by the Tenant pursuant to this
Lease, the Landlord may, without prejudice to any other right or remedy of the Landlord, pay all
or part of such required payment without prior notice to the Tenant and recover such payment from
the Tenant as Additional Rent.

	17.11	 	Charge on Property of Tenant

          As security for the payment and performance of all debts, dues and obligations of the Tenant
under this Lease the Tenant hereby grants in favour of the Landlord a fixed and paramount mortgage
and charge and grants to the Landlord a Security Interest in all goods, stock-in-trade, inventory,
fixtures, equipment, chattels and facilities of the Tenant and the said goods, stock-in-trade,
inventory, fixtures, equipment, chattels or facilities shall not be removed by the Tenant unless
otherwise permitted in writing by the Landlord. The provisions of this Article and the mortgage
and charge hereby conferred shall survive expiration of the Term or earlier termination of this
Lease.

ARTICLE 18 — GENERAL PROVISIONS

	18.1	 	Time
	 
	 	 	Time shall be of the essence hereof.
	 
	18.2	 	Notices
	 
	 	 	Any notice required to be given hereunder by any party shall be deemed to have been
well and sufficiently given if:

	 	(a)	 	personally delivered to the party to whom it is intended or if such party is
a corporation to
an officer of that corporation; or
	 
	 	(b)	 	mailed by prepaid registered mail, transmitted by facsimile or delivered, to
the address or
facsimile number of the party to whom it is intended as follows:

	 	(i)	 	if to the Landlord, at the address or number set forth in Section 1.1
(a)(ii);
	 
	 	(ii)	 	if to the Tenant, to the Premises or to the address or
number set forth in Section l.l (b)(ii);

		 	or to such other address or number as a party may from time to time direct in
writing.

Any notice delivered before 4:30 p.m. local time on a Business Day shall be deemed to have been
received on the date of delivery and any notice delivered after 4:30 p.m. local time on a Business
Day or delivered on a day other than a Business Day, shall be deemed to have been received on the
next Business Day. Any notice mailed shall be deemed to have been received seventy two (72) hours
after the date it is postmarked. Any notice sent by fecsimile before 4:30 p.m. local time on a
Business Day shall be deemed to have been received when the sender receives the answer back
confirming receipt by the recipient; provided, however, that any facsimile received after 4:30 p.m.
local time on a Business Day or received on a day other than a Business Day shall be deemed to have
been received on the next Business Day. If normal mail or communications service is interrupted by
strike, slow-down, force majeure or other cause after the notice has been sent the notice will not
be deemed to have been received until actually received. In the event normal mail service is
impaired at the time of sending the notice, then personal delivery or facsimile transmission only
shall be effective.

	18.3	 	Extended Meanings

 

 

          “Hereof”, “herein”, “hereunder” and similar expressions used anywhere in this Lease
relate to the whole of this Lease and not to any particular section or subsection, unless otherwise
expressly provided. The use of the neuter singular pronoun to refer to the Landlord or the Tenant
is deemed a proper reference even though the Landlord or the Tenant is an individual, partnership,
corporation or a group of two (2) or more individuals, partnerships or corporations. The necessary
grammatical changes required to make the provisions of this Lease apply in the plural sense where
there is more than one (1) landlord or tenant and to either corporations, associations,
partnerships or individuals, males or females, shall in all instances be assumed as though in each
case fully expressed.

	18.4	 	No Transfer on Bankruptcy

          Neither this Lease nor any interest of the Tenant herein nor any estate hereby created
will pass or enure to the benefit of any trustee in bankruptcy or any receiver or any assignee for
the benefit of creditors of the Tenant or otherwise by operation of law.

	18.5	 	Successors Bound

          All rights and liabilities herein given to, or imposed upon, the respective parties
hereto shall extend to and bind the several respective heirs, executors, administrators,
successors and assigns of the said parties and if there is more than one (1) party described in
Section 1.1(b), they shall all be bound jointly and severally by the terms, covenants and
agreements herein on the part of the Tenant. No rights, however shall enure to the benefit of any
assignee of the Tenant unless the assignment to such assignee has been first approved by the
Landlord. All covenants, agreements, stipulations, obligations and other provisions of this Lease
to be observed, performed and kept by the Tenant shall run with the land and therefore be
enforceable by all the successors of the Landlord.

	18.6	 	Headings

          The headings in this Lease have been inserted for reference and as a matter of convenience
only and in no way define, limit or enlarge the scope or meaning of this Lease or any provisions
hereof.

	18.7	 	Tenant’s Acceptance

          The Tenant hereby accepts this Lease of the Premises, to be held by the Tenant, subject
to the conditions, restrictions and covenants set forth herein.

          IN WITNESS WHEREOF the parties hereto have executed this Lease as of the day and year first
above written.

	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 	 	NORTH AMERICAN CONSTRUCTION GROUP INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	Per :
	 	/s/ [ILLEGIBLE]	 	 
	 
	 	 	 	 	 	 
	 	 	ACHESON PROPERTIES LTD.	 	 
	 
	 	 	 	 	 	 
	 

	 	Per:
	 	/s/ [ILLEGIBLE]	 	 

 

 

SCHEDULE “A”

	 	 	 	 	 
	 

	 	Legal Description:
	 	Lot 5, block S, Plan 79R05960

Extension 0, Surface Parcel 110859565

Regina, Saskatchewan

 

 

 2

	 	(a)	 	To the extent that the following costs are incurred or facilities supplied, the
cost of lighting, heating, ventilating, air conditioning and supplying water and other
utilities to the Common Areas; cleaning; janitorial services; snow and ice removal;
striping and repairing Parking Areas; supervising, policing and security; painting;
planting and landscaping; maintenance, repairs and replacements to the apparatus for
heating, ventilating and air-conditioning installed in the Premises; operating and
maintaining the garbage compaction equipment; repairs and replacements to the Premises,
other than Structural Repairs but including any changes required by any governmental or
other agency regulating operation of the Premises; business taxes, place of business
taxes and any other taxes levied in respect of or fairly attributable to the Common
Areas; Property Taxes, if not already included in Additional Rent pursuant to any
provision of the Lease; costs of appeals against assessments for Property Taxes;
insurance premiums; supplies; all office expenses and personnel wages; employee
benefits and payroll expenses; all railroad spur track fees, costs and expenses
whatsoever; plus
	 
	 	(b)	 	periodic depreciation of the machinery, equipment and fixtures which
by their nature require periodic or substantial replacement calculated on the basis of
the cost of the said machinery, equipment and fixtures being fully depreciated over the
useful life thereof as determined by the Landlord or a qualified consultant retained by
the Landlord for such purpose; and

There shall be excluded from Operating Costs without duplication:

	 	(c)	 	periodic depreciation on the capital cost to the Landlord of the Premises at
the time that the Premises were first constructed, except as expressly set out above;
	 
	 	(d)	 	payments of principal and interest under any mortgages on the Premises;
	 
	 	(e)	 	corporate, income, profits;
	 
	 	(f)	 	the costs of repair of damage, to the extent that insurance proceeds are
actually recovered by the Landlord in respect thereof;
	 
	 	(g)	 	items that are the responsibility of the tenants of the Premises pursuant to
their respective leases with the Landlord.

7. Parking Areas means the paved portions of the Premises which have been or are to be allocated
for the parking of motor vehicles, as from time to time altered, reconstructed or expanded, and
includes entrances, roads and other means of access thereto and any parking structures or other
parking facilities from time to time constructed.

8. Premises means the lands set out in Section 1.1 (d), more or less and all structures and
improvements from time to time erected thereon and their appurtenances, all as the same may be
expanded or altered in accordance with this Lease from time to time.

9. Property Taxes means all general, special, local improvement, school and water taxes, levies,
rates and charges from time to time imposed against the Premises, or any part thereof, by municipal
or other governmental authorities having jurisdiction, together with the costs of contesting or
negotiating the same, but exclusive of income taxes, business taxes, place of business taxes,
estate, inheritance, succession, capital levy or transfer tax. (Should it be found that due to
changes in the method of levying or collection of any tax, levy, rate or charge to be imposed upon
the Premises, or any part thereof, or should any new tax, levy, rate or charge be levied or imposed
in lieu of or in addition to those contemplated by the above

 

 

 3

definition, the Landlord and the Tenant hereby agree to negotiate an amendment or new provision to
this Lease as is necessary to deal with such tax, levy, rate or charge, in an equitable manner so
as to obviate any injustice or inequity which shall have arisen and should the Landlord and the
Tenant fail to agree on such amendment or new provision the same shall be settled by arbitration
in accordance with the Arbitration Act of the jurisdiction governing this Lease, and amendments
thereto, or any like statute in effect from time to time).

10. Sales Tax means any sales, tax, business transfer tax, value added tax or any similar tax
imposed against the Landlord or the Tenant by the Government of Canada, or any provincial or
municipal government, to the extent that such tax is imposed against the Landlord or the Tenant or
is required to be paid or collected by the Landlord by reason of any payment by the Tenant to the
Landlord pursuant to any provision of this Lease.

11. Security Deposit means the sum of money specified in Section 1.1 (g), to be held by the
Landlord in accordance with the terms of this Lease.

16. Security Interest means an interest in goods, chattel paper, a security, a document of title, an
instrument, money or an intangible, that secures payment or performance of an obligation as more
specifically defined in the Personal Property Security Act of Alberta, any amendments there or
replacement thereof.

17. Structural Repairs means only repairs to the foundations, the structural subfloors, columns and
beams and the structural portions of bearing walls and roofs of the Premises and specifically
excludes maintenance of every kind.

18. Substantial Damage or Destruction means such damage as, in the opinion of the Landlord’s
architect, requires substantial alteration or reconstruction of the Premises or of such other
portion of the Premises or such damage to the Premises as cannot be repaired within a period of one
hundred and eighty (180) days from the time of such damage to the state wherein the Tenant could
use substantially all of the Premises for its business.

19. Tenant means the party or parties described in Section 1.1 (b) and the heirs, executors,
administrators, successors and permitted assigns thereof.

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