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MISE EN GARDE TABLE OF CONTENTS ARTICLE 1 – OBJECT 1.1 Location and description 1.2 Cadastral description 1.3 Measurement 1.4 Lessor’s right to change location of Leased Premises ARTICLE 2 – USE OF LEASED PREMISES 2.1 Use 2.2 Non-exclusive use or Exclusive use 2.3...................................Prohibited use 2.4..................................Non-competition ARTICLE 3 – TERM 3.1 Commencement and expiry 3.2 No tacit renewal or Automatic extension or Renewal by notice or Right of renew or Option to renew ARTICLE 4 – DELIVERY AND IMPROVEMENTS i

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Page 1: LES COMPARUTIONS - Me Marie-Lou Lafrance · Web viewMISE EN GARDE. T. ABLE OF CONTENTS . ARTICLE 1 – OBJECT . Location and description. Cadastral description. Measurement. Lessor’s

MISE EN GARDE

TABLE OF CONTENTS

ARTICLE 1 – OBJECT

1.1 Location and description1.2 Cadastral description1.3 Measurement1.4 Lessor’s right to change location of Leased Premises

ARTICLE 2 – USE OF LEASED PREMISES

2.1 Use 2.2 Non-exclusive use

or Exclusive use 2.3 Prohibited use 2.4 Non-competition

ARTICLE 3 – TERM

3.1................................................................Commencement and expiry 3.2..................................................................................No tacit renewal .............................................................................or Automatic extension

or Renewal by noticeor Right of renew or Option to renew

ARTICLE 4 – DELIVERY AND IMPROVEMENTS

4.1 Delivery date and Lessor’s works4.2 Lessee’s works4.3 Lessee’s right to make alterations4.4 Initial improvements 4.5 Allowance for initial improvements 4.6 Late delivery 4.7 Acceptance of premises 4.8 Continuous occupancy4.9 Access to premises to make improvements before commencement date

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4.10 The Commission de la santé et de la sécurité du travail of Quebec

ARTICLE 5 – RENT

5.1 Amount and method of payment5.2 Base rent 5.3 Additional rent 5.3.1 Operating costs 5.3.2 Consumption taxes (GST and QST)5.3.3 Estimate of operating costs5.3.4 Actual operating cost5.3.5 Disagreement5.3.6 Proportional share and adjustment5.3.7 Interest on outstanding rent5.3.8 Contestation5.3.9 Reimbursement of expenses incurred by the Lessor5.4 Rent on percentage basis

ARTICLE 6 – SERVICES, INSTALLATIONS, COMMON AREAS

6.1 Description of services6.1.1 Electricity6.1.2 Control of electrical consumption6.1.3 Heating, air conditioning, access to Leased Premises6.1.4 Maintenance of common areas6.1.5 Cleaning of Leased Premises6.1.6 Washrooms6.1.7 Use of installations and common areas6.1.8 Suspension of services6.1.9 Non-execution by Lessor

ARTICLE 7 – NOTICES AND SIGNS

7.1 Directory board7.2 Signs and postings

ARTICLE 8 – PARKING

ARTICLE 9 – MAINTENANCE

9.1 Maintenance and repairs9.2 Default by Lessee

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9.3 Glass panes

ARTICLE 10 – INSURANCE

10.1 Lessee’s insurance10.2 Terms and conditions of Lessee’s insurance10.3 Increased risk10.4 Proof of insurance

ARTICLE 11 – ACCESS BY LESSOR TO LEASED PREMISES

11.1 Inspection and repairs11.2 Visit of Leased Premises11.3 Installations

ARTICLE 12 – DAMAGE AND DESTRUCTION

12.1 Destruction of Leased Premises12.1.1 Damage that cannot be repaired within one hundred and eighty (180) days12.1.2 Damage that can be repaired within one hundred and eighty (180) days12.2 Destruction of immovable12.3 Insurance proceeds12.4 No obligation to rebuild12.5 Destruction by Lessee12.6 Uninsured damages

ARTICLE 13 – ASSIGNMENT AND SUBLETTING

13.1 Lessor’s consent13.2 Presumed assignment and subletting13.3 Justified refusal13.4 Offer to Lessor13.5 Solidarity

ARTICLE 14 – DEFAULT, RECOURSES

14.1 Default14.2 Resiliation of lease14.3 Damages14.4 Non-renunciation

ARTICLE 15 – BY-LAWS

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ARTICLE 16 – SECURITY

16.1 Movable hypothec16.2 Letter of credit16.3 Suretyship

ARTICLE 17 – DEMAND NOTICES

17.1 Procedure and addresses

ARTICLE 18 – END OF LEASE

18.1 Removal of works and improvements

ARTICLE 19 – ARBITRATION

ARTICLE 20 – MISCELLANEOUS

20.1 Entire agreement20.2 Solidarity20.3 Publication20.4 Mutual agreement20.5 Time limits mandatory20.6 Changes to immovable by Lessor20.7 Renunciation of compensation20.8 No partnership20.9 Transfer duties

SCHEDULES

1.1 PLAN OF LEASED PREMISES

1.3.1 MEASURING SURFACE AREAS

4.1 BASIC ELEMENTS AND WORKS CARRIED OUT BY LESSORAT ITS EXPENSE

4.1A WORKS CARRIED OUT BY LESSOR AT LESSEE’S EXPENSE

4.2 WORKS CARRIED OUT BY LESSEE AT ITS EXPENSE

5.3.3 ESTIMATED OPERATING COSTS

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6.1.5 CLEANING OF LEASED PREMISES

15.1 BY-LAWS

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LEASE

On ……………, in the year two thousand and …………….

Before Mtre. ……………, notary at ………………, Province of Quebec,

APPEARED

………………, hereinafter called the “Lessor”

AND

………………, hereinafter called the “Lessee”

WHO, for the purposes of this lease, make the following declarations and agree as follows:

ARTICLE 1 – OBJECT

1.1 Location and description

The Lessor hereby leases premises to the Lessee located on the …………… floor of the building situated at ……………, having a rentable area of …………… square feet [or metres]. The premises are outlined in red on a plan annexed hereto as Schedule 1.1 after having been acknowledged as true and signed for identification by the parties in the presence of the notary. The premises bear the number …………… and are hereinafter called the “Leased Premises.”

1.2 Cadastral description

The immovable in which the Leased Premises are situated is known and designated as follows: lot …………… of the official cadastre of …………….

1.3 Measurement

The rentable area is calculated in accordance with the “Standard Method of Measuring Floor Area in Office Buildings,” ANSI/BOMA Z.65.1-1996.

OR

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The rentable area is calculated in accordance with the method described in Schedule 1.3.1 annexed hereto after having been acknowledged as true and signed for identification by the parties in the presence of the undersigned notary.

1.4 Lessor’s right to change location of Leased Premises

At any time before or after occupancy of the Leased Premises by the Lessee, the Lessor shall have the right, subject to giving the Lessee sixty (60) days’ prior notice, to change the location of the Leased Premises to other premises in the immovable of equivalent dimensions and quality. In that event, the Lessor undertakes to pay all expenses relating to plans and specifications, as well as all other reasonable expenses relating to the change and to the Lessee’s move, with the same improvements or improvements of comparable value. The rent per square foot [or metre] of rentable area payable by the Lessee shall remain the same, the whole in accordance with the terms of this lease. Change of location shall not in any way affect the validity of the other clauses or conditions of this lease and shall not result in novation.

ARTICLE 2 – USE OF LEASED PREMISES

2.1 Use

The Leased Premises shall be used solely for ……………. The Lessor warrants that the Leased Premises can be used for this purpose.

2.2 Non-exclusive use

The Lessee acknowledges that this lease does not give it exclusivity and does not restrict the Lessor’s right to allow other premises in the immovable to be used for similar purposes.

OR

2.2 Exclusive use

The Lessor grants the Lessee the exclusive right to operate a …………… business in the building, and it undertakes not to allow the use of other premises in the building for similar purposes for the term of this lease or any subsequent renewal. The Lessor declares that it has not granted any other lessee in the building the right to use premises for similar purposes and it undertakes to inform the other

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lessees of this exclusive right and to take all measures permitted by law to enforce compliance with this clause.

2.3 Prohibited use

Without limiting the generality of the foregoing, the Lessee shall not use or tolerate the use of the Leased Premises or any part thereof for one or more of the following activities:

2.3.1 the sale of any used or surplus goods, or fire insurance or bankruptcy salvage stock, or for any flea, or similar, market;

2.3.2 the sale of firecrackers or fireworks of any kind;

2.3.3 any auction sale, sale of a business (with the exception of the sale of a business to an assignee or sub-lessee under the terms of an assignment of lease or subletting authorized hereunder), liquidation sale resulting from the closing or bankruptcy of a business, warehouse sale;

2.3.4 any sale or business, the sales methods or quality of operations or goods whereof would, in the opinion of the Lessor acting reasonably, be prejudicial to the other lessees or to the reputation of the commercial area;

2.3.5 any misleading sales practice or advertising that is unethical or immoral;

2.3.6 any illicit or erotic activity.

The Lessee shall not use any part of the Leased Premises for storage or office space, except for accessory areas not exceeding twenty percent (20%) of the area of the Leased Premises the necessity whereof can be justified, and of areas the Lessor has designated for storage.

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2.4 Non-competition

Throughout the term of this lease and any renewal thereof, the Lessee shall not, directly or indirectly, within a radius of …………… kilometres, carry on any enterprise similar to the one carried on in the Leased Premises, or participate in or lend money to such an enterprise, or provide any financial or other support, with the exception of an enterprise already carried on by the Lessee when this lease comes into effect. Should the Lessee not comply with this clause, the Lessor may, in addition and without prejudice to its other recourses, require that all income derived from the enterprise be declared and added to the gross sales as though they formed part thereof.

ARTICLE 3 – TERM

3.1 Commencement and expiryThis lease shall have a term of …………… years, commencing on

…………… and ending on …………….

3.2 No tacit renewal

This lease shall expire of right at the end of the term, unless terminated beforehand pursuant to a provision hereof. Notwithstanding article 1879 of the Civil Code of Québec, occupancy of the Leased Premises by the Lessee after expiry of the term without a written agreement with the Lessor shall not constitute tacit renewal of this lease. In such a case, the Lessee shall be presumed to occupy the Leased Premises against the will of the Lessor, who may then avail himself of its recourses under the law to evict the Lessee and claim damages. The Lessor may, at its option, consider such occupancy on the basis of an indeterminate lease that may be resiliated upon one month’s prior notice, with all the terms and conditions of this lease except (i) for the term, (ii) for the base rent, which shall be double the base rent payable monthly during the last year preceding the expiry of the term or during the last renewal period, as applicable, payable in instalments in advance on the first day of each month, and (iii) that no inducement payment, free rent, or allowance, renewal option, reduction in rent, right of first refusal, right to additional space, or other similar right or concession shall be granted.

OR

3.2 Automatic extension

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Subject to the Lessee’s promptly respecting each and every obligation hereof, the term of this lease shall be automatically extended for one additional term of …………… (……………) year(s), unless the Lessee gives written notice to the Lessor, no later than six (6) months before the end of the term, of its intention not to extend the term of the lease. If notice is given, the lease shall expire at the end of the term, without tacit renewal. If the lease is automatically extended pursuant to this clause, the conditions of the lease during the extension period shall be the same as those for the initial period, save for the base rent, which shall be ……………. No inducement payment, free rent, or allowance, renewal option, reduction in rent, right of first refusal, right to additional space, or other similar right or concession that may have been granted for the initial period shall apply to the extension period.

OR

3.2 Renewal by notice

Four (4) months before the end of the lease, the Lessee must give the Lessor written notice of its intention to vacate the Leased Premises, failing which, the Lessor may, no later than ninety (90) days before the end of the lease, notify the Lessee in writing that the lease will be renewed under the same conditions for an additional period of …………… (……………) months from the expiry date. If no notice is given, this lease shall expire of right, without notice or formal demand, on the date stipulated in article 3.1, and occupancy of the Leased Premises by the Lessee shall not extend or renew the term for any period whatever notwithstanding any provision of the law, and the Lessee shall be deemed to occupy the Leased Premises against the Lessor’s will.

The Lessor may, at its discretion, refuse to renew the lease where the Lessee’s credit is not at least as good on the date of renewal as it was when the lease first took effect, and it shall be the Lessee’s obligation to demonstrate its credit rating to the Lessor’s complete satisfaction.

OR

3.2 Right to renew

Subject to the Lessee’s not being in default hereunder, the Lessor grants the Lessee an option to renew this lease for an additional term of five (5) years under the same terms and conditions, save for the base rent, which shall be as follows: ……………. To exercise this option, the Lessee must notify the Lessor in writing of its intention no later than six (6) months before the end of the lease.

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OR

3.2 Option to renew

Subject to the Lessee’s promptly paying the rent and all other sums payable in virtue hereof and respecting each and every term and condition stipulated herein, it shall have the option to renew this lease for an additional term of …………… (……………) year(s), under the same terms and conditions, subject to the conditions hereinafter stipulated. This option is also conditional on the Lessor’s receiving six (6) months’ prior written notice from the Lessee, failing which there shall be no option. Notwithstanding what is contained herein, it is expressly understood that the lease shall not be renewed for any term other than that stipulated hereinabove.

The rent must be negotiated six (6) months before the end of the lease. It shall be not less than the rate in effect during the fifth (5th) year of the lease but shall be limited to the lesser of the two (2) following amounts:

– a sum equal to …………… percent (……………%) of the base rate, which for the purposes hereof is set at …………… dollars ($……………) per square foot [or metre].

and

– a sum equal to the base rate, which for the purposes hereof is set at …………… dollars ($……………) per square foot [or metre], adjusted in accordance with the Statistics Canada Consumer Price Index for …………… [region] between the commencement date of the lease and the initial termination date.

Operating costs for the renewal period shall be adjusted to the actual costs and added to the renewal base rent to form the option rent.

ARTICLE 4 – DELIVERY AND IMPROVEMENTS

4.1 Delivery date and Lessor’s works

The Leased Premises shall be delivered on …………… (hereinafter called the “delivery date”) in accordance with the “Basic Elements” description annexed to the original hereof as Schedule 4.1, after having been acknowledged as true and signed for identification by the parties in the presence of the undersigned notary.

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The Lessor moreover undertakes to carry out, before the delivery date and at the Lessee’s expense, the works described in Schedule 4.1A, “Works to be carried out by the Lessor at the Lessee’s expense,” which remains annexed to the original hereof after having been acknowledged as true and signed for identification by the parties in the presence of the undersigned notary.

4.2 Lessee’s works

Any works required by the Lessee on the Leased Premises, other than those provided for in Schedules 4.1 and 4.1A hereto, must be carried out by the Lessee at its expense.

OR

4.2 Lessee’s works

On the date of delivery or on any other date designated in writing by the Lessor, the Lessee must have completed, at its expense and to the Lessor’s satisfaction, the Lessee’s works in Schedule 4.2 in accordance with the plans submitted beforehand by the Lessee to the Lessor, and the Leased Premises must be sufficiently fitted out and furnished such that they may be occupied and used for the purpose for which they are rented as of the commencement date of the lease. The Lessor shall have a period of …………… (……………) day(s) from receipt of the plans to approve them and to indicate any required changes to the Lessee. The Lessee shall have a period of …………… (……………) day(s) from receipt of the required changes to submit a revised plan to the Lessor.

All works must be executed in accordance with the said plans and any revised plans.

Moreover, all electrical plans and works must first be approved by the Lessor and carried out by the Lessor’s electrician at the Lessee’s expense.

4.3 Lessee’s right to make alterations

4.3.1 As of the delivery date, the Lessee may, at its expense, make the improvements in the Leased Premises it considers will best meet its needs, on condition that plans and specifications be submitted to, and duly approved in writing by, the Lessor before any work is begun; that it remit to the Lessor insurance certificates confirming that all the insurance that must be carried by the Lessee under the terms hereof is in force; that it obtain the required permits from the competent authorities and that it provide the Lessor with proof thereof; that it obtain

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the Lessor’s approval of the contractors it hires; that the works be executed in accordance with trade practices, the plans and specifications approved by the Lessor, the laws and regulations in force, the Lessee’s and Lessor’s insurers’ requirements, and the Lessor’s by-laws. Moreover, the Lessee shall not begin work without first submitting to the Lessor copies of agreements signed with contractors and professionals in respect of the work, and without furnishing the Lessor with security acceptable to the Lessor for payment of the work, professional fees, and supervision by the Lessor.

4.3.2 The work shall be carried out under the Lessor’s supervision and the Lessee shall, on demand, pay supervisory fees to the Lessor equal to ten percent (10%) of the cost of the work excluding the cost of initial improvements made by the Lessee mentioned in article 4.4 hereinbelow.

4.3.3 At no time may the Lessee make alterations to the structure, exterior walls, electrical or mechanical systems, ventilation, heating, plumbing, air conditioning, or any other system forming part of the basic systems of the immovable, without the Lessor’s express approval, it being understood that, if the intended works affect the structure, exterior walls, or any of the aforesaid systems, the Lessor shall have the right, at its option, to complete the work itself at the expense of the Lessee. Upon completion of the work, or, at the Lessor’s option, as the work progresses, the Lessee shall pay the Lessor the cost of the Lessor’s work, plus ten percent (10%) for the Lessor’s fees in addition to the supervisory fees provided for in the preceding clause.

4.3.4 The Lessee shall promptly remove any scrap or debris that accumulates during construction; it must not hinder the Lessor, the other lessees, or the operation of the immovable.

4.3.5 The Lessee must, before the work begins, sign an agreement with the contractor concerning the determination and payment of professional fees, improvement costs, and supervisory fees.

4.3.6 Notwithstanding the foregoing, it is understood and agreed that article 4.3 shall not apply to decoration, minor repairs, or outfitting, such as painting, wallpapering, and floor installation.

4.3.7 Any work that might generate strange noises or inconvenience other lessees must be carried out between 7:00 p.m. and 7:00 a.m.

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4.4 Initial improvements

Initial improvements, including the works mentioned in Schedules 4.1 and 4.1A but excluding those described in Schedule 4.1, which are the responsibility of the Lessor, shall be defined by the Lessee in consultation with professionals designated by the Lessor. All work in respect of initial improvements shall be carried out under the supervision of the Lessor at the expense of the Lessee by a contractor designated by the Lessor. Professional fees for the aforesaid initial improvements shall also be paid by the Lessee.

Initial improvements shall be subject to the rules set forth in clause 4.3, except that no supervisory fees shall be charged to the Lessee.

4.5 Allowance for initial improvements

4.5.1 An allowance of not more than …………… dollars ($……………), excluding GST and QST, per square foot [or metre] of rentable area shall be granted to the Lessee by the Lessor to defray part or all of the Lessee’s expenses for initial improvements. Reimbursement of the allowance by the Lessee shall be amortized over the term of the lease and added to the base rent. The budget establishing the cost of initial improvements, a timetable, and all bills for initial improvements must be approved by the Lessee.

4.5.2 The Lessor shall keep and use the allowance to pay for initial improvements directly to the contractor it has designated in accordance with the provisions hereinabove. The payments must have the prior approval of the Lessee, which approval shall not be unreasonably withheld.

4.5.3 Where the cost of initial improvements exceeds the allowance, the Lessee shall pay the excess to the Lessor within fifteen (15) days of receipt of the Lessor’s bill supported by vouchers; where the cost is less, the Lessee may submit other bills to the Lessor for improvements to the Leased Premises, up to the amount of the allowance.

4.5.4 If the cost of initial improvements plus the additional bills furnished by the Lessee in accordance with clause 4.5.3 is less than the allowance, the difference shall be credited toward the base rent.

4.6 Late delivery

The Lessor’s works described in Schedules 4.1 and 4.1A must be substantially completed, and the Lessor shall deliver the Leased Premises to the

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Lessee, no later than the delivery date. If the Lessor’s works are not substantially completed by this date and the Lessor is, as a result, unable to deliver the Leased Premises to the Lessee, the commencement date of the lease shall be postponed by the number of days of delay, unless the delay is imputable to the Lessee, in which case the commencement date shall not change. However, it is expressly understood that, in all cases, the Lessor shall incur no liability toward the Lessee as the result of such delay, unless the delay is due to the Lessor’s fault or negligence, and the Lessee shall not be entitled to seek resiliation of the lease unless the delay exceeds …………… (……………) months beyond the delivery date provided for in clause 4.1.

4.7 Acceptance of premises

The Leased Premises shall be deemed to have been delivered in good condition and suitable for the purpose for which they were leased, unless the Lessee notifies the Lessor in writing within thirty (30) days of delivery that the premises were not delivered in the agreed-upon condition (Schedules 4.1 and 4.1A).

4.8 Continuous occupancy

The Lessee shall occupy the Leased Premises as of the commencement date of the lease and shall thereafter continue to occupy the whole of the Leased Premises and operate its business in a normal, continuous, and energetic fashion during business hours, namely ……………, unless prevented therefrom by a govern-ment authority for any reason except its own negligent misconduct. The Lessee ac-knowledges that the continuous and normal occupancy of the Leased Premises and their use for the purposes for which they were leased are of utmost importance to the Lessor, to prevent the appearance and impression of abandonment generally created by vacant premises, facilitate the rental of vacant space, and promote the renewal of other leases and the maintenance of the nature and quality of the Lessor’s immovable and the Leased Premises by other lessees. It acknowledges that the Lessor will suffer serious and irreparable damage if the Leased Premises re-main vacant after the commencement of this lease, if they are abandoned during the term of the lease, or if the Lessee does not comply with this clause, even if the Lessee continues to pay the required rent. Moreover, the Lessee acknowledges that, given the urgency in such a situation, the Lessor shall be entitled to protect its rights by injunction.

4.9 Access to premises to make improvements before commencement date

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On the delivery date, or prior thereto with the Lessor’s authorization, the Lessee may, once the Lessor’s works described in Schedules 4.1 and 4.1A have been completed, have access to the Leased Premises before the commencement date of the lease for the sole purpose of carrying out initial improvements. The Lessee shall respect all conditions of the lease during such access, but shall not be required to pay any base or additional rent. The Lessee shall nevertheless be liable for any damage resulting from its acts or omissions or those of its contractors, subcontractors, or any person for whom it is legally responsible or to whom it gives access to the Leased Premises.

4.10 The Commission de la santé et de la sécurité du travail of Quebec

If the Lessee has the work carried out, it shall ensure that the contractor and any subcontractor comply with the requirements of the Commission de la santé et de la sécurité du travail of Quebec (hereinafter called the “CSST”) and it shall provide the Lessor, on demand, with proof that all requirements have been satisfied. It is expressly understood that the Lessee shall fully indemnify the Lessor for any action, claim, or demand against the Lessor for failure by the contractor and/or subcontractor to comply with CSST requirements.

ARTICLE 5 – RENT

Option 1: Fixed rent in a gross lease

5.1 Amount and method of payment

This lease is granted in consideration of a total gross rent of …………… dollars ($……………), payable by the Lessee to the Lessor at its head office or at any other place in the Province of Quebec indicated in writing by the Lessor from time to time, as of the commencement date of the lease and throughout the full term, without deduction, reduction, or compensation, in ………… (……………) equal, consecutive, monthly instalments of ………… dollars ($……………) each, payable in advance on the first day of each month as of …………, without notice or formal demand, the Lessee being on notice by the mere passage of time. All payments must be made in legal tender of Canada.

Option 2: Variable rent in a gross lease

5.1 Amount and method of payment

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5.1.1 This lease is granted in consideration of a total gross rent of …………… dollars ($……………), payable by the Lessee to the Lessor at its head office or at any other place in the Province of Quebec indicated in writing by the Lessor from time to time, as of the commencement date of the lease and throughout the term, without deduction, reduction, or compensation, in …………… (……………) equal, consecutive, monthly instalments of …………… dollars ($……………) each, payable in advance on the first day of each month as of ……………, without notice or formal demand, the Lessee being on notice by the mere passage of time. All payments must be made in legal tender of Canada.

5.1.2 As of the second year of the lease, the rent may vary with any variation in property taxes affecting the immovable, which are …………… dollars ($……………) for the first year. The Lessee undertakes to pay to the Lessor, as of the second year of the lease and in addition to the rent established in the preceding clause, an additional rent equal to the Lessee’s proportional share of all increases in municipal, school, or other taxes, whether general or special, affecting the immovable throughout the term of this lease or its renewal and resulting from new valuations, rates, or taxes, the base year being …………… to …………… for school taxes, and …………… for municipal taxes.

5.1.3 The Lessee’s proportional share is the ratio between the rentable area of the Leased Premises and the total rentable area of the immovable, namely …………… percent (……………%). In the event of a reduction in taxes, there shall be a similar reduction in rent, less the Lessee’s proportional share of any costs or fees incurred to contest the property valuation. This clause may in no way be interpreted to allow the rent to decease to an amount less than that specified in paragraph 5.1.1. Every year, the Lessor shall provide the Lessee with its tax statements together with an account explaining the increase or decrease.

Option 3: Variable rent in a gross lease

5.1 Amount and method of payment

The Lessee undertakes to pay the following rent to the Lessor at its head office or at any other place in the Province of Quebec that the Lessor may indicate in writing from time to time to the Lessee, in monthly instalments as of the commencement date of the lease and throughout the term, without deduction, reduction, or compensation, in legal tender of Canada, in advance on the first day of each month:

5.2 Base rent

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The Lessee shall pay to the Lessor the following sums as base rent, including reimbursement of the allowance for initial improvements:

5.2.1 for years …………… to …………… of the lease, …………… dollars ($……………) per year per square foot of rentable area in the Leased Premises;

5.2.2 for years …………… to …………… of the lease, …………… dollars ($……………) per year per square foot of rentable area in the Leased Premises.

5.3 Additional rent

5.3.1 Operating costs

The intention of the parties hereto is that the Lessor shall collect the rent completely net, free, and clear of all taxes, costs, and expenses in respect of the preservation, protection, operation, maintenance, and management of the Leased Premises and the immovable. Throughout the term of the lease and any renewal thereof, the Lessee shall, as additional rent, pay its proportional share of the operating costs hereinafter defined to the Lessor in advance in equal, consecutive, monthly instalments, each equal to one-twelfth (1/12) of the amount payable, on the dates of the monthly instalments of base rent (the base rent and the additional rent together being called the “rent”).

For the purposes hereof, “operating costs” means and includes:

– management and administration costs and expenses in respect of the immovable, and salaries, wages, and costs relating to employee benefits and pension plans of any kind for the Lessor’s employees assigned to the maintenance and repair of the immovable;

– the cost of all goods and services supplied to operate, maintain, and repair the immovable;

– the cost of outfitting, maintaining, and cleaning the common areas and the Leased Premises, repairs to the installations and common areas of the immovable, including window cleaning, snow removal, and the cleaning, repair, and maintenance of the grounds;

– the cost of repairs to the immovable, and the replacement of any equipment, device, machinery, or other property of the immovable, with the exception of those relating to the roof and the building structure for which the Lessor is responsible;

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– all amortization of capital (using the straight-line depreciation method, based on the useful life of the fixed assets or on any shorter period reasonably determined by the Lessor) on all net costs and expenses incurred after the date on which space in the immovable is occupied for the first time by a lessee, and adequately imputed to the fiscal period as fixed asset improvements or structural changes or repairs intended to reduce or limit increases in operating costs or required as a result of an amendment to any law, regulation, rule, or order issued by a competent governmental or para-governmental agency, which costs and expenses are amortized at the rate of interest that applies over the economic life of the structural improvement, change, or repair in question;

– the cost of electricity, other energy, heating, ventilation, and air conditioning;

– the cost of all insurance carried by the Lessor in respect of the immovable;

– property, business, garbage removal, and water taxes; any tax or licence fee relating to the business conducted on, or the use or occupancy of, the immovable; all other taxes levied by a governmental, provincial, municipal, intermunicipal, school, or other authority legally authorized to assess, impose, or collect taxes or charges that are not already included in property taxes or collected directly from the lessees, including the surtax on non-residential immovables and any other tax or charge levied in addition to or in replacement of such surtax;

– the tax on capital for the portion applicable to the immovable in which the Leased Premises are situated;

– all other costs and expenses directly related to the adequate preservation, protection, operation, and maintenance of the immovable.

Insurance proceeds received by the Lessor to cover the aforesaid costs shall be deducted from such costs.

Should the present tax system change, or a new tax, assessment, or levy be imposed on the immovable or on the owner of the immovable, then the term “tax” shall include such new tax, assessment, or levy, which may be charged by the Lessor under the conditions imposed by government authorities. The term “tax” does not include tax on the Lessor’s income or transfer duties payable as a result of the sale of the immovable.

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5.3.2 Consumption taxes (GST and QST)

The Lessee shall remit to the Lessor the goods and services tax, the Quebec sales tax, and any other similar tax that may be levied before or throughout the term of the lease or any renewal thereof by any competent authority and that the Lessor must collect in respect of the rent or of any other sum payable by the Lessee to or for the benefit of the Lessor under this lease, or in respect of any goods, services, or supplies furnished to the Lessee by the Lessor under this lease.

5.3.3 Estimate of operating costs

The Lessor shall remit to the Lessee, before each fiscal period and as determined from time to time by the Lessor, an estimate of the operating costs and the proportion the Lessee must pay for that period. The monthly instalments of additional rent under this article shall be established for the fiscal period in accordance with the estimate. The estimate of operating costs for the first year of the lease is …………… dollars ($……………) per square foot [or meter] of rentable area. [or The estimate of operating costs for the first year of the lease is contained in the document annexed to the original hereof as Schedule 5.3.3, after having been acknowledged as true and signed for identification by the parties in the presence of the undersigned notary.]

5.3.4 Actual operating costs

At the end of each fiscal period, the Lessor shall remit to the Lessee a financial statement showing the amount of operating costs actually incurred during that fiscal period, as well as the exact amount of the Lessee’s proportional share for the period. If the amount so determined by the Lessor is greater or less than the total already paid by the Lessee to the Lessor, then the relevant adjustments shall be made within thirty (30) days following receipt of the statement. The Lessor’s financial statement shall be conclusive as to amounts shown and irrevocably binding on the Lessee.

5.3.5 Disagreement

Should there be disagreement over an amount to be paid by the Lessee to the Lessor under any provision of this lease, the certificate of an outside chartered accountant named by the Lessor, determining such amount, shall be final and binding on the Lessee and the Lessor. Payment of the chartered accountant’s fees for this certificate shall be shared equally by the Lessee and the Lessor.

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5.3.6 Proportional share and adjustment

For the purposes of this lease, “proportional share” means the ratio between the rentable area of the Leased Premises and the rentable area of the immovable, the ratio being presently established by the parties at …………… percent (……………%). This percentage may vary in the event of an increase or decrease in the rentable area of the Leased Premises or of the immovable, and shall be adjusted accordingly.

5.3.7 Interest on outstanding rent

All outstanding rent shall bear interest from its due date until payment in full, at the prime rate for commercial demand loans charged by the Lessor’s financial institution per year plus four percent (4%), and such interest shall become due and payable as additional rent.

5.3.8 Contestation

The Lessor shall not be obliged to undertake or continue any contestation in respect of the valuation of the immovable or assessment of property taxes, whether judicial or otherwise. It may, at its option, compromise, consent, renounce, or otherwise determine any contestation of the valuation of the immovable or of any present or future claim in respect of all property taxes, without notice to the Lessee and without its consent or approval. The Lessee shall not contest the valuation of the immovable or the assessment or payment of property taxes in its own name or in that of the Lessor.

All reasonable costs and expenses incurred by the Lessor in attempting to obtain a reduction in the valuation of the immovable or in property taxes shall be added to the amount of property taxes and shall form part of the operating costs. If, as a result of such contestation, the Lessor is reimbursed, it shall credit the Lessee with its proportional share of such reimbursement.

5.3.9 Reimbursement of expenses incurred by the Lessor

All expenses incurred by the Lessor to remedy the Lessee’s failure to fulfill its obligations under the lease shall be payable by the Lessee as additional rent, plus an additional charge of fifteen percent (15%) of the amount paid by the Lessor, upon receipt of a notice in writing from the Lessor indicating the Lessee’s default and the amount paid by the Lessor; such notice must be accompanied by a copy of the bill paid by the Lessor and the Lessor’s cashed cheque or other proof of payment.

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5.4 Rent on percentage basis

5.4.1 The Lessee shall also pay an amount equal to …………… percent (……………%) of the gross sales for one year of the lease (hereinafter called “percentage basis rent”) made on the Leased Premises in excess of …………… dollars ($...............) to the Lessor as additional rent.

5.4.2 The percentage basis rent shall be computed at the end of each …………… [month, quarter, year] of the lease; the Lessee shall pay any sum then due to the Lessor no later than on the thirtieth (30th) day of the month following the last day of each …………… [month, quarter, year] of the lease and at the end of the lease.

5.4.3 The Lessee undertakes to remit to the Lessor

5.4.3.1 no later than on the tenth (10th) day of each month of the calendar year, a sales report certified by the Lessee’s duly authorized representative, indicating in sufficient detail and in the form required by the Lessor the gross sales for the preceding month;

5.4.3.2 within thirty (30) days following the end of each year of the lease or the end of the lease, a gross sales report for the year of the lease just ended or for the portion of the year preceding the end of the lease. The annual report and the report following the end of the lease must be accompanied by the opinion of an independent auditor acceptable to the Lessor. The auditor must certify that it examined the Lessee’s account books and files insofar as required and that the report is a fair representation of the gross sales for the preceding year of the lease or the portion of the year preceding the end of the lease.

Should the Lessee fail to remit the said reports to the Lessor within the specified times, the Lessor shall have the right to retain the services of an independent auditor to examine the said books and files and to certify as needed that the Lessee’s gross sales for the month, year, or portion thereof are accurate; the Lessee shall promptly reimburse the Lessor for the cost of such services.

Acceptance by the Lessor of the percentage basis rent provided for in clause 5.4.1 shall in no way prejudice its right to examine, at all times and by any means it deems appropriate, the Lessee’s registers and account books for gross sales and stock-in-trade on the Leased Premises for the period covered in any report prepared by the Lessee.

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The Lessor undertakes to refrain from disclosing information on sales figures gathered from the Lessee.

5.4.4 In order to comply with the provisions hereinabove, the Lessee and all other persons doing business on the Leased Premises must register, in the presence of clients, all revenue from cash or credit sales and other transactions, in a sealed cash register or one that is equipped with non-adjustable accumulative totalizers and balance meters. The Lessee agrees to keep, on the Leased Premises or at its head office, for a period of at least five (5) years following the end of each year of the lease, its returns for sales tax and goods and services tax for such years, as well as the originals of all relevant sales documents, including permanent and temporary cash register tapes, duplicates of consecutively numbered sales bills, originals of all mail orders received on or intended for the Leased Premises, originals of all telephone orders taken on or intended for the Leased Premises, documents concerning transactions with sub-lessees or licencees, original documents showing that returned merchandise was bought by clients on the Leased Premises, receipts, records, and any other document regarding merchandise given to clients on approval, all other documents concerning sales, such as inventory records, that would normally be examined by an independent auditor in accordance with generally accepted auditing principles in the course of an audit of the Lessee’s sales, and the documents mentioned hereinabove belonging to sub-lessees, assignees, and licencees.

5.4.5 The Lessor and its authorized representatives shall have the right to examine the aforesaid documents during business hours, and may maintain a representative on the Leased Premises to verify aggregate gross sales. If the gross sales for the period verified are greater than indicated in the report remitted to the Lessor for that period, the Lessee shall immediately pay the resulting difference to the Lessor. If the gross sales for the period verified exceed the amount indicated in the report for the same period by three percent (3%) or more, the Lessee shall, in addition to paying the difference to the Lessor, pay the cost of verification as additional rent. The verification report shall be definitive and binding on the Lessor and Lessee. If the Lessee knowingly falsifies the gross sales report or any part thereof, or if the verification report reveals that the Lessee’s books and registers are insufficient, the Lessor may resiliate this lease in addition to the other recourses at its disposal.

5.4.6 Without limiting the Lessor’s rights and recourses, it is expressly agreed that, if the Lessee ceases to operate its business on the Leased Premises or abandons the Leased Premises for any reason whatever before the end of the lease, its annual income shall be presumed to be equal to the highest yearly gross sales during the three years preceding the interruption or cessation of business, for

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each year of the lease or any part thereof remaining, or during the best quarter, if the Lessee has operated its business for less than one year prior to interruption or cessation of business. In that event the Lessee shall pay to the Lessor, in addition to the other rent and amounts payable under the terms hereof, a monthly rent determined on the basis of the aggregate presumed gross sales, in advance on the first day of each month, as of the date of the interruption of business or abandonment of the premises.

5.4.7 The term “gross sales” means, for the purpose of this lease, the aggregate amount of income generated by all transactions of the Lessee, its personnel, and any other person, on or from the Leased Premises, including income attributable to non-monetary sources, including, without limitation, all deposits on merchandise purchased on or from the Leased Premises and not reimbursed to the purchaser. No deduction shall be allowed for expenses, uncollected accounts, or bad debts. Moreover, instalment sales and sales on credit shall be immediately counted as cash sales.

The following are nevertheless to be deducted from gross sales:

(1) the Quebec sales tax (QST), the goods and services tax (GST), and any other tax actually remitted to the tax authorities, if included in the sale price;

(2) transfers of merchandise between the Lessee’s stores and the return of merchandise to the Lessee’s suppliers, on condition that such transfers and returns are made in good faith;

(3) the sale price of merchandise returned for exchange, provided it was originally included in the gross sales and that the sale price of merchandise given in exchange is added to the gross sales.

ARTICLE 6 – SERVICES, INSTALLATIONS, COMMON AREAS

6.1 Description of services

The Lessor agrees to provide the Lessee with the services indicated in this article, so long as the Lessee is not in default under the lease.

6.1.1 Electricity

The Lessor shall, as the Lessee’s mandatary, supply the Leased Premises with electricity for light and energy, subject to its being able to obtain same from its

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principal supplier for its own and co-lessees’ needs. The Lessor shall allow its electrical wires and conduits (i.e. the usual duplex receptacles and lighting outlets) to be used for this purpose. The Lessee’s use of electrical current must never exceed the safe capacity of electrical circuits supplying current to the Leased Premises.

It is agreed that the Lessor’s obligation under this lease is subject to any regulation or stipulation to the contrary of the electrical supplier or any government or municipal authority.

6.1.2 Control of electrical consumption

Should the Lessee install equipment or devices on the Leased Premises that consume an abnormal amount of electricity or if the Lessor has reason to believe that excessive amounts of electricity are being consumed by the Lessee on the Leased Premises, the Lessor shall have the right to install a meter or submeter to monitor the Lessee’s actual consumption of electricity. If it exceeds normal consumption by other lessees, the Lessee shall reimburse the Lessor for the cost of installing the meter, and, in addition to the rent, shall pay for the excess electricity actually consumed. Any amount payable by the Lessee to the Lessor pursuant to the foregoing shall be paid as additional rent no later than ten (10) days following receipt of an invoice from the Lessor to this effect, supported by vouchers.

Alternatively, and subject to the Lessor’s authorization required under paragraph 4.3.3, the Lessee may, at its expense, obtain and pay for electricity directly from its supplier. For this purpose and subject to its own needs and the needs of the other lessees in the building, the Lessor authorizes the use of its circuits and wiring system (i.e. the usual double receptacles and lighting outlets). The Lessee agrees to never consume more electricity than the safe use of the circuits found on or supplying the Leased Premises will allow.

Any special wiring system required for any special equipment of the Lessee shall be supplied and installed at its own expense.

6.1.3 Heating, air conditioning, access to Leased Premises

The Lessor shall ensure accessibility to the building and shall provide heating, ventilation, and air conditioning to the Leased Premises and the building such that the temperature inside the Leased Premises, installations, and common areas is sufficiently maintained and is comparable to buildings of the same category during regular business hours, namely, between …………… and …………… every day except Saturday, Sunday, and holidays within the meaning of the Interpretation

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Act (R.S.Q. c. I-16) (hereinafter called “regular business hours”). At all other times, the Lessor shall take measures to ensure that the Lessee has access to the Leased Premises.

OR

The Leased Premises shall be kept ventilated, heated, and air conditioned by the Lessor between …………… and …………… every day except ……………, such that the temperature of the occupied areas is always at least 18°C and never above 22°C, these temperatures being based on the following internal power:

– Lighting 2.0 watts/sq. ft. (Quebec Energy Code)

– Power (all equipment, outlets, etc. of lessees)

– 1.0 watt/sq. ft.

– One person per 100 sq. ft.

[In both cases:]

Should the Lessee require heating or air conditioning at other times, the Lessee shall pay to the Lessor, as additional rent, the cost of heating, ventilation, air conditioning, and electricity as calculated by the Lessor’s engineer.

Should the Lessee’s energy needs exceed the limits stipulated hereinabove, the Lessee shall reimburse the Lessor for the cost of installing additional equipment required for air conditioning and heating and the additional cost of electricity and mechanical components.

Should the Lessor deem it necessary to instal, maintain, or repair elements of the system on the Leased Premises for the benefit of other premises, the Lessee agrees to allow the Lessor, its agents, and contractors to do so, as long as this does not interfere with the Lessee’s activities.

6.1.4 Maintenance of common areas

The Lessor shall maintain the common areas in good condition and shall, at regular intervals and with due diligence, clean the common areas and the installations.

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6.1.5 Cleaning of Leased Premises

Option 1Cleaning of the Leased Premises is entirely the Lessee’s responsibility.

Option 2The Leased Premises shall be cleaned by the Lessor in accordance with the

specifications contained in Schedule 6.1.5. annexed hereto after having been acknowledged as true and signed for identification by the parties in the presence of the undersigned notary.

6.1.6 Washrooms

The Lessor undertakes to give the Lessee access to the washrooms on the floor of the Leased Premises.

6.1.7 Use of installations and common areas

The Lessee may use and avail itself of the installations and common areas of the immovable together with others who are entitled and have access. The Lessor shall, as a conscientious owner, ensure that the elevators, common entrances, halls, stairways, corridors, washrooms, and other parts of the immovable intended for common use are maintained and function in accordance with accepted management standards and, accordingly, the Lessor shall diligently and at all relevant times repair, replace, or rebuild such installations, common areas, or any part thereof, that may be deteriorated or damaged.

6.1.8 Suspension of services

The Lessor may, for as long as it deems necessary, suspend or modify any service in the event of an accident or in order to make repairs, replacements, alterations, or improvements, or for any reason independent of the Lessor’s will, without the Lessee’s being entitled to claim from the Lessor any reduction of rent, or any expense, loss, or disbursement resulting from the reduction or interruption of such services. However, the Lessor shall remedy same with due diligence and within a reasonable time.

6.1.9 Non-execution by Lessor

If the Lessor cannot fulfil any obligation stipulated hereunder in respect of the supply of public utilities or the execution of any work or repair because it cannot obtain the materials, equipment, public utilities, or manpower required to fulfil such

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obligation or because of any law or regulation, or for any other cause reasonably independent of its will, the Lessor shall have the right to extend the time period for the fulfilment of such obligation by a period equal to the delay. The Lessee shall not be entitled to any decrease or reduction in rent, or any claim or compensation for inconvenience or annoyance so caused, and shall not be entitled to resiliate the lease on those grounds.

ARTICLE 7 – NOTICES AND SIGNS

7.1 Directory board

The Lessor shall, at its expense, install a directory board on the ground floor of the immovable, on which shall appear the name of the Lessee and the identification number of the Leased Premises. The location, form, and content of the board shall be at the Lessor’s sole discretion.

7.2 Signs and postings

The Lessee may, at its expense, identify itself on the floor on which the Leased Premises are situated, at the entrance. The location, form, and content of such posting must have the Lessor’s prior approval.

The Lessee shall not place any sign, projection, awning, lettering, poster, or billboard on the exterior of the immovable or of the Leased Premises, or inside the Leased Premises if visible from the outside (hereinafter called “signs”), without the prior written permission of the Lessor. All such advertising is subject to the Lessee’s obtaining the required permits and to its compliance with the law and regulations, and with standards prescribed by the Lessor in this regard. The cost of the signs, their installation, their maintenance, and their removal at the end of the lease shall be at the Lessee’s expense.

The Lessee shall keep its signs in good condition. Should the Lessee fail to repair any sign within twenty (20) days of the Lessor’s request to this effect, the Lessor may make the necessary repairs itself at the Lessee’s expense; the Lessee shall reimburse such costs on demand by the Lessor, together with fees equal to fifteen percent (15%) of such costs, the whole to be invoiced as additional rent.

The Lessee shall, at the end of the lease or upon its resiliation, as applicable, remove the signs at its expense and promptly repair any damage caused by their removal. Should the Lessee refuse or neglect to remove the signs, the Lessor may, after giving the Lessee eight (8) days’ written notice, remove the signs

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itself, and the Lessee shall promptly reimburse the Lessor on demand for all expenses so incurred by the Lessor, plus fees equal to fifteen percent (15%) of such expenses.

ARTICLE 8 – PARKING

……………

ARTICLE 9 – MAINTENANCE

9.1 Maintenance and repairs

The Lessee shall keep the Leased Premises in good condition and, at its expense, make all maintenance repairs, including the replacement of light bulbs and fluorescent tubes on the Leased Premises. In addition, the Lessee shall, with prudence and diligence and at its expense, replace, repair, maintain, and decorate the Leased Premises, and keep them and all the equipment and accessories installed for the use of the Leased Premises, and all improvements, in good condition.

The Lessee undertakes to promptly notify the Lessor as soon as the Lessee becomes aware that structural repairs to the Leased Premises, and to the roof as the case may be, are required, and the Lessor shall see to such repairs and any other structural or roof repairs it considers necessary, at its expense, unless they are the result of the fault or negligence of the Lessee or of persons to whom the Lessee has given access to the Leased Premises, in which case, the repairs shall be at the Lessee’s expense.

9.2 Default by Lessee

Should the Lessee fail to preserve and maintain the Leased Premises as stipulated hereinabove, and fail to comply, within a reasonable time according to the circumstances, with a notice to this effect by the Lessor, the Lessor and its representatives shall have the right, without other prior notice, to enter the Leased Premises and to make all necessary repairs in the place and at the expense of the Lessee. The amount of such costs, plus fifteen percent (15%) to cover administration costs, shall be added to the rent as additional rent, the whole without prejudice to the Lessor’s other rights and recourses.

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9.3 Glass panes

The Lessor shall, within a reasonable time, replace all broken window panes with panes of the same quality; if a broken window results from the fault or negligence of the Lessee, its employees, its mandataries, or visitors, the Lessee shall reimburse the Lessor for the cost of such replacement, plus fifteen percent (15%) to cover administration costs.

ARTICLE 10 – INSURANCE

10.1 Lessee’s insurance

The Lessee shall, throughout the term of the lease and at its expense, carry the insurance mentioned in this article, underwritten by recognized insurers, the provisions whereof must be acceptable to the Lessor. The Lessee shall name the Lessor, and any other person, corporation, or company the Lessor may designate, as additional insureds according to their respective interests.

10.1.1 All-risk insurance against fire and other losses generally covered by such insurance, covering, at all times and to full replacement value, the Lessee’s property on the Leased Premises, the Lessee’s improvements to the Leased Premises, and all other property for which the Lessee is legally responsible or that has been installed in the immovable by the Lessee or on its behalf;

10.1.2 Plate-glass insurance covering all plate glass and windows, including glass doors, on the Leased Premises, to their full replacement value; the Lessee undertakes that, if it does not respect this clause, it shall defray the cost of replacing the glass, whatever the cause of the damage;

10.1.3 General civil-liability insurance covering bodily injury, damage to the property of others, all liability assumed by the Lessee hereunder, and the liability resulting from full operation by the Lessee or by any other person on the Leased Premises or from the execution of work by the Lessee or any other person, including persons for whom the Lessee is legally responsible in any other part of the immovable. The inclusive limit of the policy must be …………… dollars ($...............) per occurrence of bodily injury, death, or property damage, or any greater amount the Lessor may reasonable require from time to time.

10.2 Terms and conditions of Lessee’s insurance

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All insurance policies mentioned hereinabove must contain the following clauses: (1) a clause renouncing all subrogation rights the Lessee’s insurer may have against the Lessor or against those for whom the Lessor is legally responsible; (2) the standard hypothecary clauses that may be required by the Lessor’s hypothecary creditors; (3) a clause respecting the divisibility of interests and reciprocal liability; and (4) a clause stipulating that the insurer will not cancel or amend the policies without giving thirty (30) days’ prior written notice to the Lessor; all the aforesaid insurance must be underwritten by insurance companies acceptable to the Lessor.

10.3 Increased risk

The Lessee shall not commit any act or keep in or about the Leased Premises any substance that might increase the risk of fire, or result in cancellation of the Lessor’s insurance on the immovable or in an increase in premiums. At no time may the Lessee bring into or keep on the Leased Premises flammable, contaminated, or dangerous materials or explosive substances.

Should the Lessor’s insurance premiums under any policy covering or relat-ing to the immovable increase as a result of any breach of the terms and conditions of this lease by the Lessee or because of the nature of the Lessee’s business on the Leased Premises, the Lessor, in addition to all its other recourses, may pay any in-crease in premium, and the Lessee shall promptly reimburse the amount of the in-crease, plus fifteen percent (15%) to cover administration costs, to the Lessor as ad-ditional rent upon receipt of a statement supported by vouchers.

10.4 Proof of insurance

The Lessee shall furnish the Lessor with certificates attesting to the issu-ance and maintenance of all the insurance policies required under this lease imme-diately following their issuance. Should the Lessee fail to carry the required insur-ance, pay the applicable premiums, or furnish the Lessor with the required certific-ates, the Lessor may, ten (10) days after giving notice in writing to the Lessee, take out the required insurance, for itself and on behalf of the Lessee, for a period not to exceed one year, or pay the required premiums, as applicable; all premiums so paid by the Lessor, plus fifteen percent (15%) to cover administration costs, shall be re-imbursed by the Lessee as additional rent upon receipt of a statement supported by vouchers.

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ARTICLE 11 – ACCESS BY LESSOR TO LEASED PREMISES

11.1 Inspection and repairs

During regular business hours, the Lessor shall, without being liable to the Lessee and without prior judicial authorization, have access at all times to the Leased Premises to examine them for the purpose of making the repairs, replacements, alterations, or improvements useful or necessary for the operation and proper maintenance of the immovable. In that event, the Lessor shall ensure that the repairs, replacements, alterations, and improvements are carried out with due diligence so as to minimize any disturbance of the Lessee’s enjoyment of the Leased Premises. Except in the event of an emergency, access by the Lessor to the Leased Premises outside business hours must be preceded by at least twenty-four (24) hours’ notice.

11.2 Visit of Leased Premises

During the last twelve (12) months of the term, the Lessee shall permit the Lessor or any person designated by the Lessor to visit the Leased Premises during business hours. The Lessee shall also permit the Lessor to show the Leased Premises at any time during regular business hours to actual or potential hypothecary creditors, brokers, purchasers, or appraisers of the immovable.

11.3 Installations

The Lessee shall allow the Lessor to install and maintain on the Leased Premises whatever the Lessor may deem useful or necessary for the smooth opera-tion of the immovable.

ARTICLE 12 – DAMAGE AND DESTRUCTION

12.1 Destruction of Leased Premises

If the Leased Premises are destroyed or damaged, the following rules shall apply:

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12.1.1 Damage that cannot be repaired within one hundred and eighty (180) days

If the Lessor is of the opinion that the damage or destruction is such that the Leased Premises are totally unusable or that it is impossible or dangerous to use them, and if, in either case, the Lessor is also of the opinion (which must be given in writing to the Lessee within thirty (30) days following the loss) that the damage cannot be repaired with due diligence within one hundred and eighty (180) days following the loss, either party may, within ten (10) days following the other party’s receipt of the opinion, resiliate the lease by giving written notice to that effect, in which case, the lease shall terminate on the date of the destruction or damage, and the rent and all other amounts due by the Lessee under the terms hereof shall be computed and paid in full up to the date of the destruction or damage. Where neither the Lessor nor the Lessee resiliates the lease, the rent shall be suspended as from the date of the damage until the date on which the Leased Premises are repaired and normal occupancy by the Lessee is possible.

12.1.2 Damage that can be repaired within one hundred and eighty (180) days

If the Lessor is of the opinion that the damage or destruction is such that the Leased Premises are totally unusable or that it is impossible or dangerous to use them, but, in either case, the Lessor is also of the opinion (which must be given in writing to the Lessee within thirty (30) days following the loss) that the damage can be repaired with due diligence within one hundred and eighty (180) days following the loss, the Lessor shall make the repairs necessary to restore the Leased Premises, and the rent shall be suspended as from the date of the damage until the date on which the Leased Premises are repaired and normal occupancy by the Lessee is possible. Where the Lessor is of the opinion that the damage can be repaired within one hundred and eighty (180) days following the loss, and that the nature of the damage is such that partial use of the Leased Premises is possible for the purposes for which they were leased, the rent shall, until the Leased Premises are repaired to allow normal occupancy, be reduced in the proportion that the portion of the Leased Premises rendered unusable is to the whole of the Leased Premises.

12.2 Destruction of immovable

If the immovable is partially destroyed or damaged such that twenty-five percent (25%) or more of the rentable area of the immovable is affected, or if the Lessor is of the opinion that the immovable has become dangerous, whether or not the Leased Premises themselves are affected, and the Lessor is of the opinion (which must be given in writing to the Lessee within thirty (30) days following the loss) that the damage cannot be repaired with due diligence within one hundred and

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eighty (180) days following the loss, a party hereto may, within ten (10) days following the other party’s receipt of the opinion, resiliate the lease by giving written notice to that effect, in which case the lease shall end on the date of the destruction or damage, and the rent and all other amounts due by the Lessee under the terms hereof shall be computed and paid in full up to the date of the destruction or damage. If neither the Lessor nor the Lessee resiliates the lease, the rent shall be suspended as from the date of the damages to the date on which the Leased Premises are repaired and ready for normal occupancy by the Lessee.

12.3 Insurance proceeds

If the lease is resiliated in the aforesaid manner, all insurance proceeds shall be and remain the Lessor’s absolute property, except for amounts relating to the Lessee’s property less amounts owing to the Lessor under the terms hereof.

12.4 No obligation to rebuild

No provision hereof shall oblige the Lessor to repair or rebuild the altera-tions, improvements, or other property of the Lessee.

12.5 Destruction by Lessee

If the damage to the Leased Premises or to the immovable is attributable to the Lessee or to persons to whom the Lessee has allowed the use of, or access to, the Leased Premises, the damage may be repaired by the Lessor at the Lessee’s expense, and the Lessee shall forfeit its right to resiliate the lease under this article and shall not be entitled to any suspension or reimbursement of rent, the whole subject to the Lessor’s other rights and recourses.

12.6 Uninsured damages

Notwithstanding the foregoing, if the Leased Premises are destroyed or damaged by an event against which the Lessor is not insured, the Lessor may resiliate this lease, at its sole discretion, not later than fifteen (15) days following the damage or destruction, by giving the Lessee written notice of its intention within the said period, such resiliation to become enforceable on the date mentioned in the notice.

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ARTICLE 13 – ASSIGNMENT AND SUBLETTING

13.1 Lessor’s consent

The Lessee shall not assign the lease or sublet the Leased Premises, in whole or in part, without the Lessor’s prior written consent, which consent shall not be unreasonably withheld.

The Lessee shall give written notice to the Lessor of its intention to assign the lease or sublet all or part of the Leased Premises and shall indicate the name and address of the person to whom it intends to assign the lease or sublet the Leased Premises. If the Lessor refuses to agree to the assignment or sublease, it shall, within fifteen days after receipt of the notice, give the Lessee the reasons for its refusal; should it fail to do so, it shall be deemed to have accepted.

13.2 Presumed assignment and subletting

Any transfer involving, in the aggregate, fifty percent (50%) or more of the Lessee’s corporate voting shares or partnership shares, and any acquisition or exer-cise of commencement control of the Lessee’s enterprise by a person not having commencement control on the date on which the lease is signed is deemed to be an assignment of this lease or a subletting.

13.3 Justified refusal

Without limiting the generality of the foregoing, the Lessor shall be justified in withholding its consent in the following events, in particular,

13.3.1 where the assignee or sublessee proposed by the Lessee is already a lessee of premises in the immovable, and premises are available in the immovable or due to become available within the next six (6) months;

13.3.2 where the effect of the proposed assignment or subletting would be to cause the Lessor to violate a non-competition or exclusive right clause with another lessee;

13.3.3 where the assignee or sublessee cannot or will not furnish the same security under this lease as the Lessee, or security deemed equivalent by the Lessor;

13.3.4 where the assignee’s or the sublessee’s activities conflict with the destination of the Leased Premises as defined in this lease.

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13.4 Offer to Lessor

Prior to assigning the lease or subletting the whole or part of the Leased Premises, the Lessee must offer to assign the lease or sublet the Leased Premises, as applicable, to the Lessor, under the same terms and conditions as those under this lease, and the Lessor shall then have thirty (30) days in which to notify the Lessee of its choice or to accept or refuse the assignment or subletting to third parties.

13.5 Solidarity

Notwithstanding any assignment or subletting, except where such assignment or subletting is in favour of the Lessor pursuant to article 13.4, the Lessee shall always remain solidarily liable for the fulfilment of the obligations under this lease. All assignees and sublessees shall assume the Lessee’s obligations towards the Lessor. In all cases, the Lessor shall have the right to require the proposed assignee or sublessee to sign a new lease in accordance with the terms and conditions of the assignee’s or sublessee’s offer and, in that event, the Lessee shall guarantee the performance of all the obligations of such assignee or sublessee the under the new lease.

ARTICLE 14 – DEFAULT, RECOURSES

14.1 Default

The Lessee shall be in default under this lease in the following events:

14.1.1 where it does not pay any amount due and payable hereunder;

14.1.2 where it changes or alters the use of the Leased Premises;

14.1.3 where action is taken to dissolve or liquidate the Lessee or its property, or enforcement or seizure proceedings are instituted against the Lessee’s property and are not contested in good faith within five (5) days of service of the action, measures, or proceedings;

14.1.4 where it does not occupy the Leased Premises upon delivery thereof by the Lessor or leaves them unoccupied or vacant for five (5) consecutive business days, for any reason whatever;

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14.1.5 where it assigns the lease or sublets the Leased Premises, in whole or in part, without respecting the provisions hereof;

14.1.6 where it fails to fulfil any obligation or condition of the lease and schedules thereto, or to comply with any laws, rules, orders, or by-laws, and in particular but without limitation, those concerning the environment;

14.1.7 where a suretyship is ended by the surety and is not replaced within five (5) days by an equivalent security or suretyship acceptable to the Lessor;

14.1.8 where the Lessee is put into bankruptcy.

14.2 Resiliation of lease

The parties agree that the sole passage of time to perform an obligation under this lease shall have the effect of putting the debtor of the obligation on notice. In the event of any default by the Lessee, as defined in this article, the Lessor may give written notice to the Lessee of its intention to terminate the lease, and the lease shall be resiliated of right as of the fifteenth (15th) day following the date of such notice, without the requirement for legal action, except, in all cases, where the Lessee remedies the default within the time period stipulated. The Lessee acknowledges that, where the default claimed in the notice is repetitive, it cannot remedy the default to avoid resiliation of the lease.

If the lease is thus terminated, the Lessee shall vacate the Leased Premises and surrender them to the Lessor or, if it has not yet entered into possession, shall no longer have any right to possession. The Lessor, and its representatives and agents, may, as of that moment, enter onto the Leased Premises, evict the Lessee, and remove any other person and property found on the Leased Premises, either by summary eviction proceedings or by any other appropriate judicial action or proceeding, by force or otherwise, without being liable to being sued for damages or other remedy.

The Lessee expressly acknowledges that, without prejudice to any other right or remedy, the Lessor may, after expiry of the fifteen-(15)-day notice mentioned hereinabove, cease to provide the services it would otherwise be obliged to provide hereunder, including but without limiting the generality of the foregoing, disconnecting or interrupting the supply of electricity to the Leased Premises.

In any of the aforesaid events, the Lessee shall pay all sums exigible under the terms of the lease up to and including the date on which the lease is terminated, or the date on which the Lessor retakes possession, whichever is later.

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Moreover, the Lessee shall, as damages and not as penalty, pay in one instalment an amount that shall be immediately payable and exigible, equal to the base rent and total additional rents for one year (the estimated time required to lease the Leased Premises again) or, if the remainder of the term is less than a year, equal to the base rent and total additional rents for the remainder of the term.

The exercise by the Lessor of any right under this lease or underthe law shall not prevent the exercise of any other right under this lease or under the law, in particular, the right to seek judicial resiliation.

14.3 Damages

In the event that the lease is resiliated under the terms of this article, but subject to the Bankruptcy and Insolvency Act, the Lessor may immediately collect the monthly base rent and additional rent due for the current month, any amount outstanding, any other amount the Lessee may owe the Lessor, and all rent payable by the Lessee for any portion of the term of the lease that is after the commencement date of resiliation, without prejudice to the Lessor’s other rights and recourses, and in particular, the right to damages.

14.4 Non-renunciation

No leniency or forgetfulness on the part of one party in respect of the failure of the other party to fulfil its obligations hereunder shall be considered a renunciation of rights in respect of such default or any subsequent default, and shall not affect or alter in any manner whatever, the Lessor’s or the Lessee’s rights in respect of such subsequent default; moreover, no renunciation shall be inferred from any act or omission by the Lessor or Lessee, unless such renunciation is expressed in writing.

ARTICLE 15 – BY-LAWS

15.1 The Lessee undertakes to observe the by-laws of the immovable, which by-laws are deemed to form an integral part of this lease. A copy of the by-laws is annexed to the original hereof as Schedule 15.1, after having been acknowledged as true and signed for identification by the parties in the presence of the undersigned notary.

15.2 Where the immovable is or becomes subject to divided co-ownership, the Lessee shall comply with the declaration of co-ownership, a copy whereof or extract wherefrom shall be remitted to the Lessee by the Lessor.

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1. ARTICLE 16 – SECURITY

16.1 Movable hypothec

To secure the payment of rent and of any sum due or that may be due to the Lessor by the Lessee and the fulfilment of the Lessee’s obligations under this lease, the Lessee hereby hypothecates without delivery, in favour of the Lessor, the universality of its corporeal and incorporeal movable property, present and future, situated on the Leased Premises, and the insurance proceeds paid in respect of such property, including, in particular but without limitation, accounts receivable, equipment, and inventory found at this address, for the sum of …………… dollars ($...............). To secure all amounts due to the Lessor that might exceed the amount of this hypothec, the Lessee hypothecates the said property for an additional sum equal to twenty percent (20%) of the amount of the hypothec.

This security may be replaced by an equivalent or better security acceptable to the Lessor.

The hypothec created hereby must be and at all times remain a first-ranking hypothec. However, the Lessor undertakes, on demand by the Lessee unless the Lessee is in default hereunder, to grant priority of rank in favour of any financial institution to which the Lessee wishes to grant a first-ranking hypothec on the hypothecated property, so long as the hypothec is granted by the Lessee in the context of financing in good faith by the Lessee or by a company that is a member of the Lessee’s group, to purchase the hypothecated property or for the Lessee’s general financial needs, with a financial institution or an investment banking syndicate, it being understood that the hypothec created pursuant hereto may under no circumstances be lower than second-ranking.

The Lessee undertakes to notify the Lessor within thirty (30) days of granting any security or hypothec affecting the property hypothecated pursuant to this article (16.1) throughout the term of the lease or any renewal thereof.

16.2 Letter of credit

16.2.1 The Lessee shall, within ten (10) business days following the execution of this lease, remit to the Lessor an irrevocable letter of credit in the amount of ……………… dollars ($…………) drawn on a Canadian charter bank, a Caisse populaire Desjardins, or other financial institution acceptable to the Lessor, the form and content whereof must satisfy the Lessor and its legal advisors. This letter of credit, which must take effect on the date of remittal to the Lessor and expire twelve (12) months later, must stipulate that

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16.2.1.1 the Lessor may, from time to time upon simple presentation of the letter of credit, withdraw any amount on the letter of credit it considers necessary to compensate for any outstanding rent or amount payable under the lease or for loss or damage suffered by the Lessor as a result of any default hereunder by the Lessee;

16.2.1.2 such payment must be noted on the letter of credit;

16.2.1.3 the letter of credit shall remain in effect for the balance.

16.2.2 No fewer than fifteen (15) days before the expiry date of the letter of credit and no fewer than fifteen (15) days before each subsequent expiry date, the Lessee shall remit to the Lessor a new irrevocable letter of credit drawn on a Canadian charter bank or other reputable financial institution acceptable to the Lessor in the following amounts:

– for the period from ……… to ………: $………– for the period from ……… to ………: $………– for the period from ……… to ………: $………– for the period from ……… to ………: $………– for the period following the lease: no amount

16.2.3 All irrevocable letters of credit must respect the foregoing provisions, take effect on the dates mentioned hereinabove, and expire one year later. Where a new irrevocable letter of credit is remitted to the Lessor in compliance herewith, the Lessor shall remit to the Lessee the previous letter of credit (with annotations) on the date of expiry.

16.2.4 The Lessor may resiliate this lease if a letter of credit is not remitted within the specified time.

16.3 Suretyship

16.3.1 Herein intervened ………………, hereinafter called the “Surety,” who declared having taken cognizance of this lease and who stands surety solidarily with the Lessee for the fulfilment of all the Lessee’s obligations under this lease, and in particular but without limitation, the payment of rent and all other sums payable under this lease, the Surety renouncing the benefit of division and discussion. Where the word “surety” designates more than one person, the liability of the sureties shall be solidary.

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16.3.2 This suretyship shall extend to all renewals of the lease.

16.3.3 The Surety renounces the right to invoke any defect of consent or incapacity against the Lessor.

16.3.4 In the event that a surety becomes insolvent or bankrupt before the suretyship expires, the Lessee undertakes to immediately replace the insolvent or bankrupt surety with a new surety acceptable to the Lessor. The Lessee shall immediately notify the Lessor in writing of the insolvency (if notorious or known to the Lessee) or the bankruptcy of a surety and shall provide the Lessor with a new surety to replace the insolvent or bankrupt surety, failing which, the Lessor may resiliate the lease.

16.3.5 The Surety expressly renounces the right to terminate this suretyship without the written consent of the Lessor.

16.3.6 The Surety expressly declares that even though this suretyship may be linked to the performance of certain duties, it shall not end by the sole cessation of such duties.

2. ARTICLE 17 – DEMAND NOTICES

17.1 Procedure and addresses

Any notice that must be given pursuant hereto or in respect hereof shall be considered legally given if delivered personally to the recipient, sent by registered mail, or transmitted electronically (e-mail, in which case, the notice must be con-firmed in writing and sent by registered mail or served personally) at the following addresses:

– in the case of notice to the Lessor:……………

– in the case of notice to the Lessee:…………

or at any other place one party may indicate to the other by means of written notice given in the manner provided for hereinabove.

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Any notice sent by mail shall be considered to take effect on the third (3rd) business day following the date on which it is mailed. Any notice sent electronically shall be presumed to have been given and received on the following business day. Any notice delivered personally shall be presumed to have been received on the day of its delivery.

ARTICLE 18 – END OF LEASE

18.1 Removal of works and improvements

The Lessee shall not, without the prior written consent of the Lessor, remove its works and improvements at the end of the lease. The works and improvements shall form part of the Leased Premises and shall at all times remain free of any charge, security, or hypothec; they shall become the Lessor’s property as of their installation and shall be delivered by the Lessee with the Leased Premises at the end of the lease, without indemnity or compensation. Nevertheless, should the Lessor so require, the Lessee shall, at the end of the lease and at its expense, remove the works and improvements indicated by the Lessor that are particular to the Lessee and cannot be used by another lessee, and the Lessee shall be obliged to return the Leased Premises in accordance with such demand. Should the Lessee fail to remove all or part of such works or improvements in accordance with the Lessor’s request, the Lessor or its representatives may do so at the Lessee’s expense. The Lessee shall pay such expenses, plus fifteen percent (15%) to cover administration costs, to the Lessor on demand, the Lessor reserving his other rights and recourses.

ARTICLE 19 – ARBITRATION

All disputes or disagreements arising from this lease and its interpretation shall be decided by arbitration in accordance with the provisions of the Code of Civil Procedure of Quebec, to the exclusion of the courts of law except for disputes and disagreements eligible for the Court of Québec, Small Claims Division, or that may become eligible where the applicant chooses to reduce its claim, in which case that court shall have full authority to rule on the dispute or disagreement. All arbitration pursuant to this article shall be conducted in the City of ……………. Arbitration may be conducted before one arbitrator if the parties so wish and if they agree on the choice of arbitrator.

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3. ARTICLE 20 – MISCELLANEOUS

20.1 Entire agreement

This lease, the schedules whereto form an integral part hereof as though written in at length, contains all the reciprocal undertakings and obligations of the parties in respect of the rental of the premises and replaces, for all purposes of the law, all representations, negotiations, or other previous agreements of any nature whatever. This lease has precedence, and no other document, including the offer to lease, shall be used to interpret it.

20.2 Solidarity

Where the word “Lessee” designates more than one person, each person is solidarily liable toward the Lessor for the payment of rent and the fulfilment of the obligations under this lease, the whole without the benefit of division or discussion.

20.3 Publication

This lease shall not be published otherwise than in the form of a notice as provided for in article 2999.1 of the Civil Code civil of Québec, which notice shall contain only a reference to this lease, the identification of the Lessee and the Lessor, a description of the Leased Premises and of the immovable in which the Leased Premises are situated, the commencement date and expiry date of the lease, and any options to renew. The notice must have the prior written approval of the Lessor. The Lessee shall, at its expense, see to the cancellation of the notice at the end of the lease. If this is not done within twenty (20) days of the end of the lease, the Lessor may do so at the expense of the Lessee.

20.4 Mutual agreement

The parties declare that they have negotiated this agreement themselves, that it has been freely consented to, and that none of the stipulations herein have been imposed by either party, or are illegible, incomprehensible, abusive, or excessively or unreasonable detrimental, or change the nature of the essential obligations of the lease as a whole.

20.5 Time limits mandatory

All the time limits stipulated herein are mandatory.

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20.6 Changes to immovable by Lessor

The Lessor may enlarge the immovable and add floors without such works constituting a change in the nature or destination of the Leased Premises.

20.7 Renunciation of compensation

The Lessee renounces any present or future compensation it might consider itself entitled to or that others might consider themselves entitled to on its behalf, with any rent or other sum payable under the terms hereof, and it agrees to pay the rent and other amounts in full under all circumstances. The Lessee agrees that all sums it pays or owes to the Lessor may be allocated to any amount due hereunder at the Lessor’s option, notwithstanding any instruction to the contrary. No cheque endorsement or declaration in a letter accompanying a cheque shall be considered as consent or acceptance, and the Lessor may accept payment without prejudice to its rights under the law or under the terms of this lease.

20.8 No partnership

No provision of this lease may be construed as any intention by the parties to form a partnership.

20.9 Transfer duties

WHEREOF ACT ……………

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SCHEDULE 1.1

PLAN OF LEASED PREMISES

[Add plan.]

SCHEDULE 1.3.1

MEASURING SURFACE AREAS

Single-lessee floors

The rentable area of a floor fully occupied by one lessee includes the space situated inside the outside walls, measured from the inside surface of the window panes to the inside surface of the window panes on the opposite wall.

INCLUDED

Structural projections and columns and the following utility areas, including walls and partitions:

(a) Electrical, telephone, air conditioning, ventilation, and air duct utility rooms, janitor’s room, wash tubs, and toilets, situated on that floor and serving it exclusively

(b) Air-conditioning shafts and ducts, where a central air conditioning system replaces ventilation utility rooms

(c) The surface area of air conditioning and ventilation utility rooms situated on a rentable floor and serving more than one floor is divided among the floors serviced.

(d) The surface areas of the entrance hall and reception area, and the corridors leading thereto, are divided among the floors serviced.

NOT INCLUDED

The following installations, including walls and divisions, serving more than one floor:

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Public stairs; public elevator shafts.

Multiple-lessee floors

The rentable area of an individual office or part of a floor includes the space measured (a) from the inside surface of the window panes of the exterior wall to the finished surface, corridor side, of the corridor wall and (b) from the centres of walls separating the premises in question from neighbouring leased premises.

INCLUDED

Structural projections and columns and part of the following utility areas, calculated pro rata, including walls and partitions:

(a) Electrical, telephone, air conditioning, ventilation, and air duct utility rooms, public hallways, elevator areas, toilets, janitor’s room, and wash tubs, situated on that floor and serving it exclusively

(b) Air-conditioning shafts and ducts, where a central air conditioning system replaces ventilation utility rooms

(c) The surface area of air conditioning and ventilation utility rooms situated on a rentable floor and serving more than one floor is divided among the floors serviced.

(d) The surface areas of the entrance hall and reception area, and the corridors leading thereto, are divided among the floors serviced.

NOT INCLUDED

The following installations, including walls and partitions, serving more than one floor: public stairs; public elevator shafts.

………………

The surface areas of utility areas and how they are allocated shall be communicated to interested parties on simple demand.

The Leased Premises are measured by gross rentable area, which is the net rentable area increased by …………… percent (……………%).

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SCHEDULE 4.1

BASIC ELEMENTS AND WORKS CARRIED OUT BY LESSOR AT ITS EXPENSE

Standards for office space improvements

The Lessor undertakes to do the work listed below at its expense, with materials it selects and in accordance with standards established for the building, the whole in accordance with improvement plans accepted by the parties beforehand. All other work required in the Leased Premises shall be carried out by the Lessee at its expense, with the exception of the works described in Schedule 4.1A, which shall be carried out by the Lessor at the Lessee’s expense.

Floor smooth-finish concrete covered with ……………….. carpeting (24 to 28 ounces or the equivalent), colour at the choice of the Lessee

Walls and partitions gypsum rock installed on metallic mounts with sound-proofing for the conference room and closed offices

Ceiling acoustic panels seated on a light enamelled steel frame

Lighting recessed fluorescent lights (2’ x 4’) with a minimum intensity of 60 foot-candles, and decorative lighting for the entrance hall and conference room

Electricity sufficient capacity for normal requirements, including standard current outlets and switches in accordance with plans accepted by the parties, and dedicated computer circuit outlets

Heating and air conditioning

installation and distribution of heating and air conditioning in the Leased Premises in accordance with the plans accepted by the parties

Sprinkler system installation and distribution of an automatic sprinkler system in the Leased Premises in accordance with the plans accepted by the parties

Exterior doors main entrance with glass door in accordance with plans; emergency exit (if required) installed in accordance with plans

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Interior doors stained yellow birch, door and frame, for offices, and standard doors with metal frames in all other cases

Decor three (3) coats of paint; wallpaper in the entrance hall and conference room

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SCHEDULE 4.1A

WORKS CARRIED OUT BY LESSOR AT LESSEE’S EXPENSE

[Add list of works.]

SCHEDULE 4.2

WORKS CARRIED OUT BY LESSEE AT ITS EXPENSE

[Add list of works.]

SCHEDULE 5.3.3

ESTIMATED OPERATING COSTS

[Add estimate.]

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SCHEDULE 6.1.5

CLEANING OF LEASED PREMISES

General description:

1. The purpose of these specifications is to include all the maintenance and cleaning of the Leased Premises mentioned in the lease in order that they may be kept in proper state of cleanliness at all times.

2. The Lessor must supply the labour, materials, and scaffolding necessary for the work mentioned in the lease.

3. The workers hired must be experienced in this kind of work and use the best quality cleaning products and materials, appropriate for this kind of work so as not to deteriorate the surfaces to be cleaned.

4. Cleaning must be closely supervised everywhere and at all times. Modern equipment suitable for this type of work must be used. Electrical appliances must not interfere with the supply of electricity to the building.

5. Washrooms must be kept supplied with hand towels, liquid soap, and disinfectant. All such supplies are included in the cleaning costs.

6. Maintenance work must be done every evening (except Saturdays, Sundays, and holidays) after closing time, with the exception of vestibules, corridors, stairs, and washrooms, which require more frequent cleaning.

7. All horizontal surfaces of furniture, such as desks, chairs, counters, window sills, ordinary shelving, bookshelves, and other movable effects that are clear of books and paper must be carefully dusted every day.

8. Sinks, toilets, wastepaper baskets must be emptied and/or cleaned every evening.

9. No employee of the Lessor may move papers, documents, or objects left on desks or other surfaces. Under no circumstances may the Lessor’s employees open desk drawers, filing cabinets, or other furniture.

10. All glass panes in interior and exterior doors must be washed and cleaned every day.

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11. Both the interior and exterior surfaces of all window panes must be washed twice a year.

12. In offices where floors are carpeted, maintenance must be done with a vacuum cleaner.

13. The Lessor must wash and wax the floors and dust the window frames and trim twice a month.

14. All window drapes must be thoroughly cleaned by vacuum cleaner twice a year.

15. All ventilation grills and diffusers must be dusted and cleaned by vacuum cleaner once a month.

16. In April and September, the Lessor must do a general dusting of all walls, partitions, ceilings, and carpets.

17. The Lessor must supply and replace incandescent bulbs and fluorescent tubes where necessary.

18. The Lessor must see to the removal of waste and garbage by local services, at least once a week.

19. The Lessor must provide liability and fidelity insurance for its employees.

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SCHEDULE 15.1BY-LAWS

R-1 Definitions

Terms defined in the lease have the same meaning in this schedule unless otherwise defined.

R-2 Access and egress

No lessee or occupant of the building may block or use the sidewalks, passageways, entrances, corridors, elevators, or stairs, except to enter or exit the premises. The Lessor shall retain control of all parts of the immovable destined for the lessees’ common use, as the Lessor may deem appropriate, but it undertakes not to interfere unduly with access to and egress from the premises. Lessees must turn off the lights when leaving the premises after business hours.

R-3 Fire exits

Lessees may use fire exits in cases of emergency only, unless the fire exits are designated by the Lessor as normal exits.

R-4 Evacuation and firewalls

Lessees must comply with all fire safety and evacuation measures prescribed by the Lessor from time to time. The Lessor may, from time to time, instal doors in the exterior walls of the premises to comply with government requirements. The lessees and the Lessor may use the said doors in the event of emergency.

R-5 Safety

The Lessor may lock the entrance doors after business hours. Any person who enters or exits the premises outside business hours must register in any register kept by the Lessor at the night entrance or nearby. The Lessor may prevent any person from entering or exiting the premises, unless such person has a key or an access card to the elevator and/or to the building he wishes to enter, and a pass duly approved by the Lessor. Any person found in the building after hours without a key or access card or pass may be subject to the Lessor’s employees’ and representatives’ surveillance and required to leave the premises. Lessees are responsible for security on the leased premises and must, if necessary, lock the entrance and exit doors of the building when entering or exiting.

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R-6 Windows

Windows that reflect light or allow it to pass into leased premises must not be covered or blocked, and no awning may be installed above a window without the Lessor’s permission. Lessees must allow window-washers to do their work both during and after business hours. Lessees must not place anything on windows or building projections or throw anything out windows, doors, or skylights, or into hallways. The colour and fabric of curtain linings facing the interior surface of exterior windows must be approved by the Lessor beforehand, and lessees may not instal and must remove all drapes that, in the Lessor’s opinion, are not in conformity with the uniform style of window decoration established for the building.

R-7 Toilets

No lessee may use toilets or other sanitary appliances for any other use than that for which they were designed, and no waste, sweepings, rags, ashes, or other substance may be thrown into them. The cost of any damage caused by misuse of these appliances shall be assumed by the lessee concerned. No lessee may allow water to run unless it is being used.

R-8 Directory board

Lessees may post their firm names on a directory board of lessees, but only the Lessor may decide on the form of the board, its content, and the space given to each lessee.

R-9 Mail

Lessees may use the mail chutes and letter boxes, but at their own risk, the Lessor not being liable for any loss or damage resulting from their use.

R-10 Destination of premises

No lessee may allow any person to use the leased premises as a bedroom or residence, or for any immoral or illegal purposes, or to store personal effects or articles that are not required to operate a business.

R-11 Cooking

No lessee may allow any cooking other than microwave cooking on premises occupied by the lessee, without the consent of the Lessor.

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R-12 Catering

No lessee may grant any concession or permission for the sale or order of food, whether in the form of services or foodstuffs, or instal or allow the installation of any machine or device for the distribution of food or drink, or allow the preparation, service, distribution, or delivery of food or drink on the premises occupied by the lessee or in the office building, without the Lessor’s permission and unless in accordance with the Lessor’s conditions. Only persons authorized by the Lessor have the right to serve, distribute, or deliver food or drink inside the office building or to use any public area for that purpose.

R-13 Animals and bicycles

No lessee may introduce or keep any bicycle, vehicle, or animal, including birds and other familiar animals, on the premises occupied by the lessee or in the building.

R-14 Solicitation

Canvassing, solicitation, and peddling are prohibited in the building, and lessees shall cooperate with the Lessor to ensure that this prohibition is obeyed.

R-15 Equipment, safes, machines, and loads

No lessee may introduce, remove, place, construct, instal, or move a safe, office machine, or other heavy equipment, without first obtaining the Lessor’s permission. When granting permission, the Lessor may, as it wishes, determine the place and the maximum weight allowed as well as the use and form of beams, joists, or platforms intended to carry the weight. No lessee may move heavy equipment without first notifying the Lessor and unless the lessee complies with the Lessor’s requirements. The Lessor may examine any cargo. No lessee may, without the Lessor’s permission, keep or instal electrical or heat-generating equipment, except for normal office equipment, on premises occupied by the lessee.R-16 Furniture and effects

No lessee may move into or remove from premises occupied by the lessee any furniture or movable effect otherwise than at the time, under the conditions, and via the access and egress authorized by the Lessor.R-17 Carts

All carts, dollies, and similar devices used in the building must be equipped with rubber tires, guards, and any other safety device the Lessor may require.

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R-18 Cabinets reserved for electrical and air conditioning equipment

No lessee may obstruct or prevent access to shunts or cabinets reserved for electrical equipment or maintenance materials. If a lessee covers shunts with carpeting or prevents access thereto in any way whatever, the lessee must assume the costs incurred to permit access to the shunts. No lessee may leave anything on radiators or induction units.

R-19 Installation of wires

No lessee may in any way mark, paint, drill, or damage the walls, ceilings, partitions, floors, trim, masonry, or ironwork. Any drilling, sawing, or installation of wires or pipes is prohibited unless authorized beforehand by the Lessor and done in accordance with its instructions. If a lessee wishes to connect to the telegraph or telephone network, the Lessor reserves the right to instruct electricians as to the place and manner in which the wires are introduced, and no drilling or sawing may be done without such instructions. No other wire or piping of any kind may be installed without the Lessor’s permission.

R-20 Musical or sounding devices

No lessee may, outside or on the premises occupied by the lessee, run or allow to be run any musical or sounding instrument or device that may be heard outside the premises. No lessee may instal any radio or television antenna, loudspeaker, amplifier, or similar device on the roof or exterior walls of the building.

R-21 Glass, locks, and accessories

No glass door or window pane, lock, or accessory that gives access to or allows light to pass into the premises may be altered by lessees.

R-22 Locks and access cards

No lessee may instal bolts or locks or allow them to remain on doors leading onto the premises that cannot be opened with the Lessor’s principal master key or sub-master key or access card system. No lessee may change locks or lock mechanisms without the Lessor’s permission. Lessees must provide the Lessor with a key and access card for all bolts and locks. Lessees must promptly notify the Lessor of any loss of keys or access cards. Lessees must provide the Lessor, on demand, with a list of all persons having keys or access cards in their possession. No lessee may provide keys or access cards to any person other than a member of its personnel. All magnetic access cards provided by the Lessor to a lessee for

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access to the premises or the building (including parking) shall be at the lessee’s expense, to a maximum of twenty-five dollars ($25.00) per card. This amount shall be refunded to the lessee at the end of the term, provided the cards are intact.

R-23 Janitor service

Lessees must allow the janitor, or any other person designated by the Lessor, to take charge of and clean the premises before 8:00 a.m. and after 5:00 p.m.

R-24 Air conditioning system design criteria

The criteria for design of the air conditioning system are a function of the usual criteria that apply to comparable systems for comparable buildings, in particular: normal occupation per square foot; normal desk distribution per square foot; normal electrical energy consumption; installation of partitions and other divisions only at places where they will not interfere with air conditioning; and closing of curtains covering exterior windows when directly exposed to the sun.

R-25 Additional services

All services and supervision provided by the Lessor to a lessee in particular under these by-laws are additional services. The costs incurred for them by the Lessor, and all other costs that a lessee in particular must assume pursuant to these by-laws, are included in the cost of additional services provided to the lessee.

R-26 Name of building

The name lessees use for the building must be the name specified by the Lessor from time to time, for the purpose of professional address only.

R-27 No smoking

It is strictly forbidden to smoke anywhere in the building. Lessees must therefore notify their personnel and subcontractors of this prohibition to ensure that it is obeyed at all times.

This schedule forms an integral part of the lease between the Lessor and the Lessee for the premises situated in the building.

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