LEASE

1.1 

Defined Terms. In this Lease:

 

(a)

"Additional Rent" means all sums of money to be paid by the Tenant, whether to the Landlord or otherwise, under this Lease except Basic Rent;

 

(b)

"Affiliate" of any of the parties to this Lease means any corporation which is Controlled by or which Controls that party or any other corporation Controlled by, or which Controls, that corporation, whether the Control be direct or indirect;

 

(c)

"Architect" means the architect from time to time named by the Landlord;

 

(d)

"Basic Rent" means the basic rent set out in paragraph 4.2(a);

 

(e)

"Control" "Controls" and "Controlled" includes, without limitation:

 

(i)

the right to exercise a majority of the votes which may be cast at a general meeting of a corporation,

 

(ii)

the right to elect or appoint, directly or indirectly, a majority of the directors of a corporation or other persons who have the right to manage or supervise the management of the affairs and business of the corporation, and

 

(iii)

any change in the general partners of a partnership, including the resignation of a partner;

 

(f)

"Goods and Service Tax" or "G.S.T." means the tax presently levied under Part IX of the Excise Tax Act of Canada or as may be amended or substituted from time to time and includes any sales tax, multi-stage sales tax, value added tax, consumption tax or any other tax, levy, duty or assessment levied in lieu thereof or in addition thereto from time to time;

 

(g)

"Hazardous Substance" means any substance which, when released into the Premises any part of them, or into the natural environment, is likely to cause, at any time, material harm or degradation to the Premises or any part of them, or to the natural environment or material risk to human health, and includes, without limitation, any flammables, explosives, radioactive materials, asbestos, polycholorinatedbiphenyls, chlorofluorocarbons, hydrochlorofluorocarbons, urea formaldehyde foam insulation, radon gas, chemicals known to cause cancer or other toxicity, pollutants, contaminants, hazardous wastes, toxic substances or related materials, petroleum and petroleum products, or any substance declared to be hazardous or toxic or a pollutant, dangerous good, deleterious substance, effluent, hazardous waste or special waste, or words of similar meaning under any laws now or enacted in the future, which affect or apply to the Premises, the Landlord, the Tenant, or any of them;

 

(h)

"HVAC Costs" means all costs of heating, ventilating, air conditioning and humidity control of the Premises and includes, but is not limited to, cost of fuel, water, electricity, operation of air distribution and cooling equipment, cost of maintenance of facilities and systems related to heating, ventilating, air conditioning, humidity control of the Premises, labour, materials, non-capital repairs, maintenance, service and other such costs, and depreciation (computed in accordance with generally accepted accounting principles in the Province of British Columbia) of the capital cost of fixtures and equipment used therefor which by their nature require periodic replacement or substantial repair or replacement, reasonably attributable to the heating, ventilating or air conditioning or humidity control of the Premises;

 

(i)

"Landlord" means the party described as such above and its successors and assigns;

 

(j)

"Lease" means this Lease and all its Schedules, as amended from time to time;

 

(k)

"Leasehold Improvements" means all fixtures, trade fixtures, improvements, installations, alterations and additions from time to time made, erected or installed by, or on behalf of, the Tenant in or upon the Premises, including the Tenant's Work, with the exception of furniture and equipment not of the nature of fixtures, but includes all partitions however fixed (including floor to ceiling moveable partitions) and includes all wall-to-wall carpeting with the exception of carpeting laid over vinyl tile or other finished floor and affixed so as to be readily removable without damage;

 

(l)

"Mortgage" means a mortgage or charge (including a deed of trust and mortgage securing bonds and all other indentures supplemental to it) on or in respect of the Premises or any part of them, and includes all renewals, modifications, consolidations, replacements and extensions;

 

(m)

"Mortgagee" means the mortgagee or trustee for bondholders, as the case may be, named in a Mortgage;

 

(n)

"Operating Costs" means the aggregate (without duplication) of all costs and expenses incurred by the Landlord or on behalf of the Landlord for the ownership, operation, maintenance, repair, replacement and management of the Premises, whether contemplated at the time of execution of this Lease or otherwise including, without limitation, all costs and expenses of:

 

(i)

all insurance which the Landlord is obligated to obtain, and any other insurance the Landlord or its Mortgagee elects to obtain, in respect of any risk or casualty, including public liability, property damage and loss of rental income insurance,

 

(ii)

cleaning, painting, janitorial services, including snow and ice removal, garbage and waste collection and disposal,

 

(iii)

supervision and security systems,

 

(iv)

fees and other remuneration payable for operating, maintenance, engineering, legal and accounting services, and other consulting and professional services, and if those services are performed by individuals employed by the Landlord, they will include remuneration of those individuals including fringe benefits, unemployment insurance and pension plans,

 

(v)

supplies and the rental equipment used by the Landlord in maintenance and operating services,

 

(vi)

depreciation or amortization (computed by the Landlord in accordance with accounting principles generally accepted in British Columbia) of furnishings, fixtures, equipment, machinery, facilities, systems and property which by their nature require periodic or substantial repair or replacement, but excluding structural repair or replacement,

 

(vii)

repairs and replacements to, and maintenance of, the Premises including, but not limited to, the cost of gardening, landscaping and outdoor area maintenance and equipment, maintenance and repair of the roof of the Premises and the surface of the exterior walls of the Premises; but excluding structural repairs,

 

(viii)

GST on goods and services provided by or on behalf of the Landlord,

 

(ix)

costs otherwise attributable to capital account for improvements, machinery or equipment which are intended to reduce Operating Costs,

 

(x)

all costs incurred in acquiring, installing, operating, maintaining, revising repairing, restoring, renewing and replacing any energy conservation, fire safety, sprinkler and life safety systems and equipment for the Premises, and for effecting any improvements to the Premises made to comply with any changes in insurance or legal requirements, including any applicable laws or regulations governing, among other things, air pollution, air quality and environmental control standards, and for investigating, testing, monitoring, controlling, removing, disposing, enclosing, encapsulating or abating any Hazardous Substance in, on, under or above the Premises or any part thereof which, in the Landlord's opinion, or in the opinion of any regulating authority having jurisdiction, is or may be harmful to or hazardous to any person or to the Premises or any part thereof, and

 

(xi)

license, permit and inspection fees, but does not include debt service incurred by the Landlord;

 

(o)

"Permitted Business" means the permitted business described in paragraph 5.1;

 

(p)

"Prime Rate" means the highest annual rate of interest announced at the relevant time by the Toronto-Dominion Bank as a reference rate in effect for determining interest rates on Canadian dollar commercial loans made by it in Canada;

 

(q)

"Rent" means Basic Rent and Additional Rent;

 

(r)

"Security Deposit" means the deposit as defined in paragraph 4.6;

 

(s)

"Taxes" means all taxes, rates, duties, levies and assessments whatsoever, whether municipal, parliamentary or otherwise, levied, imposed or assessed against the Premises or any part of either of them or upon the Landlord in respect of them or in respect of the use and occupation of them by any competent authority, including, without limitation:

 

(i)

those levied, imposed or assessed for education, schools and local improvements,

 

(ii)

all costs and expenses (including legal and other professional fees) reasonably incurred by the Landlord in good faith in contesting, resisting or appealing any taxes, rates, duties, levies or assessments, and

 

(iii)

any and all taxes which may in future be levied in lieu of taxes as set out above provided such taxes relate to the value of the Premises or any part of either of them,

 

(t)

"Tenant's Work" means the work to be performed by the Tenant in or upon the Premises in accordance with the provisions of Schedule 2;

 

(u)

"Term" means the period of time set out in paragraph 3.2;

 

(v)

"Unavoidable Delay" means a delay in performance of an act or compliance with a covenant caused by any event beyond the reasonable control of the party obligated to perform or comply, except a delay caused by lack of funds or other financial reason.

1.2 

Schedules.  The following Schedules form part of this Lease:

 

(a)

During the Term, the Tenant will pay to the Landlord, at the office of the Landlord or at such other place in Canada as the Landlord designates from time to time in writing, in lawful money of Canada and without deduction, set-off or abatement, the aggregate of:

 

(i)

Basic Rent for the first three years of the Term of $7.50 per square foot per year plus G.S.T. payable in equal consecutive monthly instalments of $5,028.75 each plus G.S.T. in advance on the first day of each calendar month;

 

(ii)

Basic Rent for the last two years of the Term of $8.00 per square foot per year plus G.S.T. payable in equal consecutive monthly instalments of $5,364.00 each plus G.S.T. in advance on the first day of each calendar month;

(iii) 

 

(iv)

all G.S.T. assessed upon or as a direct result of the payment of Rent under this Lease and such G.S.T. will not be considered to be Rent, but the Landlord will have the same rights and remedies for non-payment of G.S.T. as it has for non-payment of Rent.

 

(b)

All Rent will accrue from day to day, and if for any reason it is necessary to calculate Rent for less than one year or one month, an appropriate adjustment will be made pro rata on a daily basis to compute the Rent for that irregular period.

 

(a)

In each year the Tenant will pay, when due, to the Landlord (or to others, as required), as Additional Rent:

(i) 

(ii) 

 

(iv)

all HVAC Costs as set out in paragraph 4.3(b)C;

 

(v)

the costs of all utilities as provided in paragraph 4.3(b)D;

 

(vi)

all taxes and assessments against Leasehold Improvements, as set out in paragraph 4.3(b)A; and

 

(vii)

all other sums of money required under this Lease to be paid to the Landlord by the Tenant whether or not designated as Additional Rent other than Basic Rent.

 

(b)

In each year the Tenant will pay as Additional Rent, and discharge when they become payable as set out in any invoice therefor whether delivered by the Landlord or any other authority or supplier:

 

A.

all taxes, rates, duties and assessments and other charges that may be levied, rated, charged or assessed against the Leasehold Improvements (including, without limitation, trade fixtures) and furniture, equipment or facilities of the Tenant on or comprising part of the Premises, and every tax and licence fee in respect of every business or activity conducted on or from the Premises, or in respect of their use or occupancy by the Tenant and every assignee, subtenant, licensee or other person conducting business on or from the Premises, whether they are charged by a municipal, provincial, federal, school or other body;

 

B.

all Operating Costs, whether invoiced by the Landlord to the Tenant or by any person who, in accordance with the provisions of this Lease, supplies services or goods relating to Operating Costs at the request or for the benefit of the Tenant;

 

C.

all HVAC Costs, whether invoiced by the Landlord to the Tenant or by any person who, in accordance with the provisions of this Lease, supplies services or goods relating to the HVAC Costs, at the request or for the benefit of the Tenant; and

 

D.

all utilities and service charges related to the Premises, whether invoiced by the Landlord to the Tenant or directly by any supplier, at the request or for the benefit of the Tenant;

 

(c)

The Tenant will indemnify and save harmless the Landlord against payment for all losses, costs, charges, expenses and other liabilities arising from all the taxes, rates, duties, assessments, licence fees, Operating Costs, HVAC Costs and utilities referred to in this paragraph 4.3(b) and all amounts which may in the future be levied in lieu of them, and any losses, costs, charges and expenses suffered by the Landlord may be recovered by the Landlord in the same manner as Rent in arrears;

 

(d)

On request of the Landlord the Tenant will deliver promptly to the Landlord receipts for payment of all amounts set out in paragraph 4.3(a) (unless invoiced by and paid directly to the Landlord), which were payable up to 1 year prior to the request, and will also deliver before the 21st day of January in each year to the Landlord if requested, evidence satisfactory to the Landlord of payment of all of them for the last preceding calendar year.

 

(e)

If the Landlord is not provided by the taxing authorities with a separate allocation of the Taxes relating to the Premises, the Landlord will make the allocation acting reasonably.  If there is a dispute as to the method or amount of the allocation, the opinion of an independent professional real property tax consultant appointed by the Landlord (whose fees will be borne equally by the Landlord and the Tenant) verifying the Taxes for the period covered by the certificate will be conclusive.  The Landlord will invoice the Tenant for the Taxes payable by the Tenant in equal monthly instalments, in advance, based upon an estimate of the Taxes for the next succeeding year.  Within 90 days after the end of each year, the Landlord will make a final determination of the Taxes attributable to the Premises for the relevant calendar year.  If the amount determined exceeds the sum of the instalments paid by the Tenant for the year in question, the Tenant will pay to the Landlord, as Additional Rent within 30 days after the date of delivery of the statement by the Landlord the excess without interest or, if the sum of the instalments paid by the Tenant during the preceding year exceed the amounts calculated by the Landlord as due for that year, the Landlord will credit the Tenant, without interest, with the amount against the next ensuing payments of Taxes due by the Tenant and, if there are no ensuing payments, the amount will be paid to the Tenant forthwith, without interest.

 

(f)

If any of the amounts referred to in paragraphs 4.3(a), 4.3(b) or 4.3(c) is not paid at the time required under this Lease, it will be collectible as Additional Rent with the next instalment of Rent falling due, but nothing in this Lease suspends or delays the payment of any amount of money when it becomes payable, or limits any other remedy of the Landlord.

 

(g)

The Tenant will pay to the Landlord G.S.T. as required under this Lease, and if there is no specific provision relating to a payment of G.S.T., the following applies:

 

(i)

G.S.T. will be paid either at the same time and in the same manner as monthly payments of Rent are payable, or at the time the taxing authority in respect of G.S.T. requires them to be paid by the Landlord or the Tenant, whichever is earlier;

 

(ii)

if a specific assessment of G.S.T. is unknown for whatever reason or the Landlord has not estimated a monthly payment of G.S.T., under paragraph 4.3(g)(iii) and any amount of G.S.T. is not paid in accordance with this Lease, then the Tenant will pay the amount of G.S.T. to the Landlord within 5 business days of receipt of notice from the Landlord specifying the amount of the G.S.T;

 

(iii)

the Landlord will, acting reasonably, estimate the amount of G.S.T. to be paid in advance with monthly payments of Rent for the period to which the estimate applies; and any necessary adjustment after the period in question will be made in the same manner as Taxes.  All G.S.T. will be calculated and paid without regard to any input tax credits, set-offs, exceptions, exemptions or deductions to which the Landlord is or may be entitled.  All payments of G.S.T. will be collectible as Additional Rent and the Landlord will have the same rights and remedies for nonpayment of G.S.T. as it has for nonpayment of Rent.

 

(h)

The Landlord estimates that Additional Rent for the first year shall be the amount of $3.35 per square foot.

 

 (a)

Without limiting the generality of its other obligations under this Lease, the Tenant will operate the Premises in a good, efficient and business-like manner and will keep the Premises neat and clean.

 

(b)

In regard to the use and occupancy of the Premises, the Tenant will at its expense:

 

(i)

keep the inside and outside of all glass in the doors and windows of the Premises and all exterior surfaces of the Premises clean,

 

(ii)

replace promptly any cracked or broken glass of the Premises with glass of like grade and quality,

 

(iii)

maintain the Premises in a clean, orderly and sanitary condition and free of insects, rodents, vermin and other pests,

 

(iv)

keep any garbage, trash, rubbish or other refuse in suitable containers within the interior of the Premises until removed and remove garbage, trash, rubbish or other refuse on a daily basis,

 

(v)

repaint, redecorate and renew the Premises and Leasehold Improvements at reasonable intervals designated by the Landlord,

 

(vi)

keep all mechanical apparatus free of vibration and noise which may be transmitted beyond the Premises,

 

(vii)

comply with all laws, ordinances, rules and regulations of governmental authorities concerning or related to the Premises, including without limitation, those dealing with the construction, repair, maintenance, operation, environmental safety, use and occupancy of the Premises,

 

(viii)

light the display windows of the Premises and exterior signs and turn the same off to the extent required by the Landlord,

 

(ix)

comply with all rules and regulations and policies established by the Landlord from time to time which apply to the Premises,

 

(x)

comply with all reasonable requests and demands of the Landlord relating to energy conservation in the Premises,

 

(xi)

refrain from use of any objectionable advertising medium such as, without limitation, loudspeakers, public address systems, sound amplifiers, or broadcasts which are in any manner audible or visible outside of the Premises, and

 

(xii)

comply with all regional air care laws for normal acceptable emissions.

 

(a)

maintain, operate and repair the Premises to the standards of first class premises and keep all portions of the Premises in good and substantial repair, including all Leasehold Improvements and all furniture, equipment and other facilities such as, without limitation, wiring, piping, lighting and plumbing fixtures, operating equipment and the plumbing, sprinkler, heating ventilating, air conditioning and humidity control systems located on, in, under, above or which directly serve the Premises, the front of the Premises and all glass and utilities in the Premises, but with the exception of other structural elements of the Premises, which the Landlord is required to repair;

 

(b)

permit the Landlord upon reasonable notice or at any time during an emergency or apparent emergency, to enter and examine the state of operation, maintenance and repair, and the Landlord may give notice to the Tenant requiring that the Tenant perform such maintenance or repair as the Landlord may find necessary from such examination and the Tenant will immediately effect and pay the cost of such maintenance and repair; and

 

(c)

if any part of the Premises becomes damaged or destroyed through the wilful act, negligence, or omission of the Tenant or any of its officers, employees, customers or other invitees, the Landlord reserves the right to conduct all repairs or replacements and to require the Tenant to reimburse the Landlord for the cost of repairs or replacement promptly upon demand.

 

(a)

unless the damage was caused by the negligence of the Tenant or an assignee, subtenant, concessionaire, licensee or an officer, employee, customer or other invitee of any of them, the Basic Rent for the period beginning on the occurrence of the damage until at least a substantial part of the Premises is again reasonably capable of use and occupancy for the purpose aforesaid will abate in the proportion that the area of the part of the Premises rendered not reasonably capable of use by the Tenant for the conduct of its business bears to the Rentable Area of the Premises, but not exceeding the amount of rental income insurance proceeds received by the Landlord for the period; and

 

(b)

unless this Lease is terminated under paragraph 7.4, the Landlord or the Tenant or both, as the case may be (according to the nature of the damage and their respective obligations to repair), will repair the damage with all reasonable diligence, but any abatement of Basic Rent to which the Tenant is entitled under this paragraph will not extend beyond the date by which, in the reasonable opinion of the Landlord, the Tenant should have completed its repairs with reasonable diligence.

 

(a)

The Landlord, by written notice to the Tenant given within 60 days of the occurrence of damage to the Premises, may terminate this Lease:

 

(i)

if the Premises are damaged by any cause and in the reasonable opinion of the Landlord either cannot be repaired or rebuilt with reasonable diligence within 180 days after the occurrence of the damage or the cost of repairing or rebuilding it would exceed by more than $100,000 the proceeds of the Landlord's insurance available for that purpose, or

 

(ii)

if the Premises are damaged by any cause and the damage is such that the Premises or a substantial part of the Premises are rendered not reasonably capable of use by the Tenant for the conduct of its business and in the reasonable opinion of the Landlord cannot be repaired or rebuilt with reasonable diligence by 6 months before the end of the Term.

 

(b)

The Tenant, by written notice to the Landlord given within 60 days of the occurrence of the damage, may terminate this Lease if the Premises is damaged by any cause and the damage is such that the Premises or a substantial part of the Premises is rendered not reasonably capable of use by the Tenant for the conduct of its business and in the reasonable opinion of the Landlord cannot be repaired or rebuilt with reasonable diligence by 6 months before the end of the Term.

 

(c)

If this Lease is terminated under either (a) or (b) above, the Tenant will not be bound to repair as provided in paragraph 7.2, and the Tenant will deliver up possession of the Premises to the Landlord with reasonable speed but in any event within 15 days after the giving of the notice of termination, and all Rent will be apportioned and paid to the date on which possession is delivered up, subject to any abatement to which the Tenant may be entitled under paragraph 7.3, but otherwise the Tenant will repair the damage with all reasonable diligence and, without limiting the foregoing, the Tenant will restore or reconstruct all Tenant's Work.

 

(a)

Before commencing any repairs, replacements, maintenance, alteration, decoration or improvements set out above, or elsewhere referred to in this Lease, which are reasonably estimated by the Tenant to cost in excess of $5,000 the Tenant will obtain the Landlord's written approval and will, if reasonably required by the Landlord to do so, submit plans and specifications therefor or, if requested by the Landlord, permit the Landlord to effect the repair, replacement, maintenance, alteration, decoration or improvement, at the Tenant's cost.

 

(b)

The Tenant will not in any event make any alterations to the structure of any portion of the Premises or to exterior walls the Premises without the prior written consent of the Landlord.

 

(c)

The Tenant will supply the Landlord with copies of all plans prepared for the Tenant for any work done to the Premises.

 

(d)

To the extent the repairs to be made by the Tenant are covered by the Tenant's insurance placed under paragraph 10.2, the release of those funds will be governed by the provisions of paragraph 10.4.

 

(a)

This Lease is subordinate to every Mortgage and the Tenant will subordinate this Lease to every Mortgage that comes into being after the date of this Lease and execute promptly and in registrable form a document in confirmation of the subordination if requested by the Landlord, in which the Tenant also will agree with the Mortgagee that if the Mortgagee becomes a mortgagee in possession or takes action to realize the security of the Mortgage the Tenant will attorn to the Mortgagee as a tenant upon all the terms of this Lease, but only if the Mortgagee agrees in writing to accept the attornment and permit the Tenant, if not in default, to continue in occupation of the Premises until this Lease is terminated by the passage of time or by action taken because of a default of the Tenant.

 

(b)

The Tenant appoints the Landlord its agent or attorney (at the Landlord's option) to execute the documents referred to in (a) above as agent or attorney of the Tenant and if, following 10 days' notice to do so, the Tenant fails to execute any of them, the Landlord may terminate this Lease.

 

(a)

this Lease is unmodified and in force in accordance with its terms (or if there have been modifications, that this Lease is in force as modified, and identifying the modifications, or if this Lease is not in force, that it is not) and that the Tenant is in possession of the Premises;

 

(b)

the commencement date and expiry date of this Lease;

 

(c)

the date to which Rent has been paid with particulars of any prepayment of Rent;

 

(d)

whether or not there is an existing default by the Tenant in the payment of Rent or any other sum of money under this Lease, and whether or not there is any other existing default by any party under this Lease concerning which a notice of default has been given, and if there is any, specifying its nature and extent; and

 

(e)

whether or not there are any set-offs, defences or counterclaims against the enforcement of the obligations of the Tenant under this Lease.

 

(a)

all risks, property insurance on the Premises and comprehensive boiler and machinery insurance on the equipment contained in the Premises and owned by the Landlord (excluding any property required to be insured by the Tenant), which insurance will be endorsed to cover the gross rental value of the Premises, all in such reasonable amounts and with reasonable deductibles as determined by the Landlord, having regard to the size, age and location of the Premises;

 

(b)

commercial general liability insurance concerning the Landlord's ownership and use of the Premises in such amounts and with such deductibles as the Landlord determines, having regard to the size, age and location of the Premises; and

 

(c)

such other form or forms of insurance as the Landlord or the Mortgagee reasonably considers advisable.

 

(a)

all risks (including flood and earthquake) property insurance on the Tenant's insurable property including, without limitation, merchandise, furniture, fixtures and Leasehold Improvements, to the full replacement value thereof, on a stated amount coinsurance basis, with a deductible as may be approved by the Landlord;

 

(b)

broad comprehensive boiler and machinery insurance on all objects owned or operated by the Tenant or others on behalf of the Tenant in the Premises with deductibles not exceeding $1,000;

 

(c)

business interruption insurance providing coverage for 12 months loss of insurable gross earnings or profits including coverage not in excess of 2 weeks while access to the Premises is prohibited by order of governmental authority as a direct result of damage to neighbouring premises by a peril insured against;

 

(d)

commercial general liability insurance concerning the Premises and the business conducted by the Tenant and any other persons in or from the Premises with inclusive limits of $3,000,000.00 per occurrence. This insurance will include, without limitation, owners' protective, products, completed operations, intentional acts to protect persons or property, personal injury, contingent employers' liability, and occurrence property damage.  It will name the Landlord and the Mortgagee as additional insureds and will contain cross liability and severability of interests provisions;

 

(e)

Tenant's legal liability insurance for the actual cash value of the Premises, including loss of use;

 

(f)

non-owned automobile insurance, including contractual liability (S.E.F. No. 96) and, on an owner's form, covering all licensed vehicles operated by or on behalf of the Tenant, each with inclusive limits of not less than $1,000,000; and

 

(g)

any other form of insurance and with whatever higher limits that the Landlord or the Mortgagee reasonably requires from time to time.

 

(a)

name the Landlord as a loss payee and contain a waiver of subrogation against the Landlord and its employees and agents or the Mortgagee, whether the loss or damage is caused by the fault, default, act, omission or negligence of the Landlord or those for whom the Landlord is in law responsible;

 

(b)

except concerning the Tenant's stock-in-trade, and furniture, incorporate the standard mortgage clause of the Mortgagee;

 

(c)

cover all property owned by the Tenant or for which the Tenant is legally liable, located within the Premises, including, without limitation, the Tenant's Work and the Leasehold Improvements, in an amount not less than the full replacement cost thereof, including by-laws extension, which will be reviewed at least annually by the Tenant and will be subject to the approval of the Landlord.

 

(a)

The Tenant will not do, or omit to do, anything, or keep, use, sell or offer for sale on or from the Premises anything that may contravene any of the Landlord's policies of insurance relating to any part of the Premises, or which will prevent the Landlord from procuring policies of insurance with companies acceptable to the Landlord.  The Tenant will pay all increases in premiums for any insurance carried by the Landlord insuring any part of the Premises, resulting from the type of merchandise sold on or from the Premises, or anything done or omitted to be done on the Premises, whether or not the Landlord has consented to them.  In determining whether increased premiums result from any of those causes, a schedule issued by the organization making the insurance rate on the Premises showing the various components of the rate will be conclusive evidence of the several items and charges which make up the insurance rates relating to the Premises.

 

(b)

If the use or occupancy of the Premises causes an increase of premium for any of the policies insuring the Premises above the rate applicable for the least hazardous type of use or occupancy legally permitted in the Premises, the Tenant will pay the amount of the increase.  Bills for the increases and additional payments may be rendered by the Landlord to the Tenant when the Landlord elects, and will be payable by the Tenant when rendered.

 

(c)

The Tenant will not do or permit to be done, or omit to do or permit another person to omit to be done, any act which may render void or voidable, or which may conflict with, the requirements of any policy or policies of insurance relative to the Premises, including any regulations of fire insurance underwriters applicable to such policy or policies.

 

(a)

re-enter the Premises and Part 15 will apply;

 

(b)

enter the Premises and remedy that condition, and the Tenant will pay to the Landlord the cost of doing so on demand as Additional Rent, and the Landlord will not be liable for damage or injury caused to property of the Tenant or others located on the Premises as a result of the entry or remedy; or

 

(c)

terminate this Lease.

 

(a)

if the Landlord determines that the financial condition of the proposed assignee, subtenant or occupant (collectively "Transferee") or any indemnifier of a Transferee is or may become insufficient to support all of the financial and other obligations of the Tenant under this Lease;

 

(b)

if the use to which the Premises will be put by the proposed Transferee is inconsistent with the terms of this Lease or will materially or adversely affect any legitimate interest of the Landlord;

 

(c)

if the business reputation or character of the proposed Transferee or any of its affiliates is not reasonably acceptable to the Landlord;

 

(d)

if, at the time of the proposed Transfer,

 

(i)

the Tenant is in default (or would be in default with the giving of notice by the Landlord and the expiration of any applicable cure period) under this Lease, and

 

(ii)

the Landlord has not received assurances acceptable to the Landlord, in its sole discretion, that any past due amounts owing from the Tenant to the Landlord will be paid and any other defaults on the part of the Tenant will be cured prior to the effectiveness of the proposed Transfer;

 

(e)

if the Transfer will result in a division of the Premises;

 

(f)

if the Transfer is not approved by any Mortgagee having the right to approve such Transfer; or

 

(g)

if the Tenant has not received a bona fide, written offer to take an assignment or a sublease or has not supplied a copy of such offer to the Landlord at the time of requesting consent to a Transfer.

 

(a)

the Landlord's consent to a Transfer, if granted, will not constitute a waiver of the requirement for the Tenant to obtain the Landlord's prior written consent to any subsequent Transfer;

 

(b)

the Landlord may impose additional conditions on any Transfer which the Landlord considers advisable, which may include further restrictions on the use of the Premises or any part, the inclusion in this Lease of any provisions of the Landlord's then standard form lease, the rescission of any special rights granted to the Tenant under this Lease such as, without limitation, options to renew or extend the Term, rights of first refusal to lease and restrictive covenants;

 

(c)

if the Landlord consents to a proposed Transfer, the Landlord will have the right to approve the form of the Transfer;

 

(d)

in spite of any Transfer, the Tenant will remain fully liable for and will not be released from the performance of each and every one of the obligations of the Tenant under this Lease for the balance of the Term and any renewal term, whether exercised by the Tenant or the Transferee. Without limitation, the foregoing applies whether or not the Transferee is in default of this Lease and whether or not this Lease is assigned by a trustee in bankruptcy of the Transferee. The Tenant is not relieved of liability for any breach of this Lease, whether occurring before or after the Transfer; and

 

(e)

any Transfer will provide that the Transferee has the rights and is subject to the obligations, of the Tenant under this Lease, except as it may be amended by the terms of the consent.

 

(a)

If after the date of execution of this Lease shares either of the Tenant or of an Affiliate of the Tenant which Controls the Tenant are transferred or disposed of by operation of law or otherwise, or issued or redeemed, so as to result in a change in the Control of the Tenant from the person or persons holding Control on the date of execution of this Lease or if other steps are taken to accomplish a change of Control, the Tenant will promptly notify the Landlord in writing of the change, which will be considered to be an assignment of this Lease to which this Part 11 applies; and whether or not the Tenant notifies the Landlord, the Landlord may terminate this Lease within 60 days after the Landlord becomes aware of the change unless the Landlord previously had consented to the change.  Any subsequent of change of Control will similarly be subject to the prior written consent of the Landlord.  The Tenant will make available to the Landlord or its lawful representative all corporate books and records of the Tenant and of any Affiliate of the Tenant for inspection at all reasonable times, to ascertain to the extent possible whether there has been a change in Control.

(b) 

 

(i)

the Tenant is a public corporation whose shares are listed for sale on a recognized stock exchange in Canada, or

 

(ii)

the Tenant is a private corporation which is Controlled by a public corporation as defined in paragraph (i),

 

(a)

The Tenant, at the Tenant's cost, will comply with the applicable requirements of all municipal, provincial, federal and other governmental authorities now in force or which may hereafter be in force, including without limitation, all laws and regulations pertaining to the use, possession, control, removal, disposal and abatement of Hazardous Substances and all other laws and regulations pertaining to the Tenant's occupancy or use of the Premises and will observe in any occupancy and use of the Premises all municipal by-laws and provincial and federal statutes and regulations now in force or which may hereafter be in force, and will comply with all regulations made by fire insurance underwriters.  The provisions of this paragraph 12.2(a) will survive the expiration or earlier termination of this Lease.

 

(b)

The Landlord may enter the Premises at any time or times, with as little interference to the conduct of the Tenant's business as is reasonably possible, to enable the Landlord to comply with any municipal by-law or provincial statute now or in the future applicable to the Premises whether or not the application of the by-law or statute to the Premises results from an act or omission of the Landlord or any other person.

 

(c)

If the Tenant has knowledge, or has reasonable cause to believe that any Hazardous Substance has come to be located on, under or about the Premises, the Tenant will, upon discovery of the presence or suspected presence of any Hazardous Substance, give written notice of that condition to the Landlord.  Failure to provide written notice will be a default, permitting the Landlord to terminate this Lease immediately.

 

(d)

If the Landlord, in its sole discretion, believes that the Premises or the environment have become contaminated with any Hazardous Substance, the Landlord, in addition to its other rights under this Lease, may enter upon the Premises and obtain samples from the Premises and under the Premises, for the purpose of analyzing the same to determine whether and to what extent the Premises or the environment have become so contaminated.  To the extent that contamination is found and that such contamination was caused by the Tenant, the Tenant will reimburse the Landlord for the costs of such inspection, sampling and analysis.

 

(e)

Without limiting the above, the Tenant will indemnify and save harmless the Landlord from and against any and all claims, losses, liabilities, damages, costs and expenses, including without limitation, legal fees and costs on a solicitor and own client basis, arising out of or in any way connected with the use, manufacture, storage, or disposal of Hazardous Substances by the Tenant, its agents or contractors, on, under or about the Premises including, without limitation, the cost of any required or necessary repair, cleanup or detoxification and the preparation of any closure or other required plans in connection with this Lease.  The indemnity obligations of the Tenant under this paragraph will survive any termination of this Lease.

 

(a)

latent defects in the Premises which cannot be discovered on a reasonable examination, and

 

(b)

faults in structural elements relating to the Premises not caused by the Tenant's act or negligence.

 

(a)

All Leasehold Improvements including, without limitation, trade fixtures installed by, or on behalf of, the Tenant will be of first class quality.  The Tenant will not make or cause to be made any Leasehold Improvement, change, decoration, addition or improvement or cut or drill into, nail or otherwise attach, secure or install any trade fixture, exterior sign, floor covering, interior or exterior lighting, or mechanical or electrical system or fixture, or plumbing fixture, shade or awning to any part of the Premises or to the exterior of the Premises or hang from or affix anything to the ceiling, without first obtaining the Landlord's written approval.  The Tenant will not create or cause to be created any mortgage, security interest or other encumbrance in respect of the Leasehold Improvements (including trade fixtures), furniture or furnishings, or inventory of the Tenant except with the prior written consent of the Landlord.

 

(b)

The Tenant will present to the Landlord plans and specifications for the Tenant's Work and all other work from time to time at the time approval is sought and the work will be done by contractors or other workers or tradesmen approved by the Landlord and in good and workmanlike manner with first class materials.

 

(c)

The Tenant will not make or permit to be made any changes, alterations, substitutions, replacements or improvements affecting the structure of the Premises or the exterior appearance of the Premises or the operation of the mechanical systems including, without limitation, the heating, ventilation, air conditioning, humidity control, plumbing, electrical, or mechanical equipment in or connected with the Premises without obtaining the prior written consent of the Landlord.

 

(d)

The Tenant will pay, on demand, as Additional Rent, all the Landlord's costs and expenses in connection with any installations and changes by the Tenant, including, without limitation, the costs of supervising and inspecting the work and the cost of examining the Tenant's drawings and specifications, together with a sum of 15% of such costs, representing the Landlord's overhead.

 

(a)

All Leasehold Improvements when installed become the property of the Landlord, without compensation to the Tenant, but the Landlord will have no responsibility for the repair, replacement, operation, maintenance or insurance of the Leasehold Improvements, which will remain the responsibility of the Tenant.

 

(b)

No Leasehold Improvements (including, without limitation, trade fixtures) or furniture or equipment will be removed from the Premises before the end of the Term without the prior consent in writing from the Landlord.  Upon termination of this Lease the Leasehold Improvements will remain the property of the Landlord unless required by the Landlord to be removed by the Tenant.

 

(c)

At the end of the Term the Tenant will, at its expense, remove the Leasehold Improvements to the extent requested by the Landlord and all furniture, furnishings and equipment and make good any damage caused to the Premises by such installation or removal and restore the Premises to a condition of good and substantial repair, as required in paragraph 7.2.  Every installation, removal or restoration by the Tenant of furnishings, equipment, furniture and, if applicable, Leasehold Improvements, will be done at the sole expense of the Tenant.

 

(d)

If the Tenant does not remove any Leasehold Improvements, or its furnishings, furniture or equipment as required by the Landlord, the Landlord may, without liability on its part, and not as a bailee, without notice to the Tenant, enter the Premises and remove such items at the Tenant's expense, plus an administration charge of 15% of such amount, which will be paid by the Tenant to the Landlord as Additional Rent, on demand, and such items may, without notice to the Tenant or to any other person and without obligation to account for them, be sold, destroyed, disposed of or used by the Landlord as it determines.

 

(e)

If the Tenant removes, or commences, attempts or threatens to remove any of the equipment, furniture, furnishings, stock-in-trade, chattels or inventory belonging to the Tenant in the Premises, or any Leasehold Improvements, without the Landlord's consent, the Tenant hereby consents (without limiting any other rights of the Landlord) to the Landlord obtaining an injunction in a court of competent jurisdiction to restrain the Tenant from removing any of the items referred to from the Premises, and the Tenant will pay to the Landlord all fees (including without limitation, all professional fees and all legal fees on a solicitor and own client basis) and expenses incurred by or on behalf of the Landlord concerning obtaining such an injunction.

 

(f)

The Tenant's obligations under this paragraph 14.2 will survive the expiration or earlier termination of this Lease.

 

(a)

The Tenant will not place or permit to be placed or maintained on the roof or on any exterior or interior door, wall or window of the Premises or elsewhere on the Premises any sign, awning, canopy, decoration, lettering, advertising matter or other thing of any kind and will not place or maintain any decoration, lettering or advertising matter on the glass of any window or door of the Premises without first obtaining the Landlord's written consent.

 

(b)

The Landlord will have the right to prescribe the size, materials, colours, design features, pattern, appearance, location, illumination and any other specifications of any sign.

 

(c)

The Tenant will comply, at its expense, with all requirements of authorities having jurisdiction regarding permits, licences and other consents for any signs installed.

 

(d)

Following approval by the Landlord, any exterior sign erected by the Tenant will be illuminated in the manner and at the times required by the Landlord.  All costs, including, without limitation, electrical costs pertaining to the sign, will be paid, when due, as Additional Rent.

 

(e)

At the expiration or earlier termination of this Lease, the Tenant will remove, at its expense, any sign installed by it, repairing any damage caused thereby.  Any part of the sign will, at the Landlord's option, be considered to be a Leasehold Improvement.

 

(f)

The Tenant will indemnify and save the Landlord harmless from any claims, loss or damage arising directly or indirectly from the Tenant's signage.

 

(a)

re-enter and remove all persons and property from the Premises and the property may be removed and stored in a public warehouse or elsewhere at the cost of, and for the account of, the Tenant, all without service of notice or resort to legal process and without the Landlord being guilty of trespass or becoming liable for loss or damage occasioned by any of those actions;

 

(b)

terminate this Lease and all of the Tenant's rights under it; and

 

(c)

apply part or all of the Security Deposit to rectify, in whole or in part, any financial default of the Tenant.

 

(i)

any of the goods and chattels of the Tenant on the Premises at any time during the Term are seized or taken in execution or attachment by a creditor of the Tenant or the Tenant receives a notice from one or more of its secured creditors that the creditor(s) intend to realize on security located at or upon the Premises,

 

(ii)

the Tenant makes an assignment for the benefit of creditors or any arrangement or compromise, or a bulk sale from the Premises other than a bulk sale to an assignee or sublessee under an assignment or sublease which under Part 11 was consented to,

 

(iii)

a receiver-manager is appointed to control the conduct of the business of the Tenant on or from the Premises,

 

(iv)

the Tenant becomes bankrupt or insolvent or takes the benefit of an Act now or hereafter in force for bankrupt or insolvent debtors or files any proposal or a notice of intention to file a proposal,

 

(v)

proceedings are instituted by the Tenant or any other person for an order for the winding-up of the Tenant, or other termination of the corporate existence of the Tenant,

 

(vi)

the Premises, without the written consent of the Landlord, become and remain vacant for a period of 10 days except as necessitated for the completion of repairs or are used by any persons other than those entitled to use them under the terms of this Lease,

 

(vii)

the Tenant, without the written consent of the Landlord, abandons or attempts to abandon the Premises or sells or disposes of its goods or chattels or removes any of them from the Premises so that there would not, in the event of abandonment, sale or disposal, be sufficient goods on the Premises subject to distress to satisfy all Rent due or accruing due hereunder, or

 

(viii)

this Lease or any of the Tenant's assets on the Premises are taken under a writ of execution, charge, debenture or other security instrument,

 

(b)

The Tenant will immediately notify the Landlord if it receives from any of its secured creditors a notice under the Bankruptcy and Insolvency Act, or any legislation in amendment or substitution therefor, advising the Tenant that the secured creditor intends to realize upon its security located on the Premises.

 

(c)

Unless the Landlord expressly consents thereto, which the Landlord is not obliged to do, the Tenant will not exercise any right to repudiate this Lease under the terms of a proposal filed under the Bankruptcy and Insolvency Act, or any legislation in amendment or substitution therefor.

 

(a)

If the Landlord re-enters, as provided in this Lease, it may at its option, without terminating the Tenant's rights under this Lease, make alterations and repairs considered by the Landlord necessary to facilitate a reletting, and relet the Premises or any part thereof as agent of the Tenant for such period of time and at such rent and upon such other terms and conditions as the Landlord in its discretion considers advisable.

 

(b)

Upon each reletting all rent and other monies received by the Landlord from the reletting will be applied, first to the payment of indebtedness other than Rent due hereunder from the Tenant to the Landlord, secondly to the payment of costs and expenses of the reletting including brokerage fees and legal fees and costs of the alterations and repairs, and third to the payment of Rent due and unpaid under this Lease.  The residue, if any, will be held by the Landlord and applied in payment of future rent as it becomes due and payable.

 

(c)

If the rent received from the reletting during a month is less than the Rent to be paid during that month by the Tenant, the Tenant will pay the deficiency to the Landlord.  The deficiency will be calculated and paid monthly.

 

(a)

The Landlord and its agents may enter the Premises at all reasonable times to examine them and to show them to a prospective purchaser, tenant or mortgagee.

 

(b)

The Landlord may make alterations, additions and adjustments to and changes of location of the pipes, conduits, wiring, ducts and other installations of any kind in the Premises where necessary in the opinion of the Landlord, but the Landlord will take commercially reasonable steps to minimize any disruption of the Tenant's business.  The Landlord may take all material required on to the Premises without constituting an eviction of the Tenant in whole or in part. The Rent reserved will not abate while the alterations, additions or changes of location are being made by reason of loss or interruption of the business of the Tenant, or otherwise, and the Landlord will not be liable for damage to property of the Tenant or of others located on the Premises as a result of any entry including damage caused by the negligence of the Landlord or another person for whose negligence the Landlord is responsible in law.

 

(c)

During the 6 months prior to the expiration of the Term the Landlord may place upon the Premises a notice "For Rent" and at any time, the Landlord may place upon the Premises a notice "For Sale", which the Tenant will permit to remain without interference.

 

(d)

If after reasonable notice to the Tenant (except in the case of an emergency when no prior notice is required), the Tenant is not present to open and permit entry into the Premises when the Landlord requires entry, the Landlord or its agents may enter by a master key or may forcibly enter without rendering the Landlord or its agents liable for any damage or trespass and without affecting this Lease.  Nothing in this paragraph 17.1 imposes on the Landlord an obligation, responsibility or liability for the care, maintenance or repair of the Premises or any part thereof except as specifically provided in this Lease.  The Landlord will have the right at all times to enter on the Premises in order to install, construct, operate, maintain, repair and replace any utilities and services, but the Landlord in doing so will exercise such right in a manner which is commercially reasonable to minimize the extent of interference with the use and enjoyment of the Premises.

 

(a)

twice the monthly instalment of Basic Rent payable for the last month of the Term, and

 

(b)

1/6th of the amount of Additional Rent payable by the Tenant for the year immediately preceding the last year of this Lease,

 

(a)

the Tenant pays the Rent and all other monies payable by it under this Lease and performs and has consistently performed all of its obligations under this Lease punctually and in accordance with this Lease and is otherwise not in default of any of its obligations to the Landlord, and

 

(b)

the original Tenant has not assigned this Lease or sublet or permitted a change in occupancy or other Transfer of the Premises, and

 

(c)

there has been no change in Control of the Tenant,

 

(i)

any renewal of this Lease will be limited to five years each and will be limited to two in number, and there will be no further renewals,

 

(ii)

the Basic Rent to be paid during each renewal term will be the fair market rent at the time of the exercise of the option for space of comparable size, quality and location to that of the Premises, as determined by agreement between the Landlord and the Tenant, with or without the assistance of mediation, or if they fail to agree within 3 months prior to the expiration of the existing Term, then the Basic Rent will be determined by a single arbitrator appointed under the Commercial Arbitration Act, as such legislation may be amended or substituted from time to time, whose decision will be final and binding upon the Landlord and the Tenant.  The cost of the arbitration will be borne by the Landlord and the Tenant equally.  In any event the Basic Rent for any renewal term will not be less than the Basic Rent applicable during the most recent year, and

 

(iii)

concerning any renewal term, the Landlord will have no obligation to pay or provide to the Tenant any allowance, concession or inducement of any nature, or provide any free rent or discounted rent of any nature, or provide any fixturing period, or do or perform any work in the Premises.

 

(a)

The Landlord may, at its option, and at the Tenant's expense, require that the Tenant enter into an agreement prepared by the Landlord to give effect to the renewal term or execute a new lease for the renewal term on the Landlord's then standard form lease currently in use at such time.

 

(b)

During the period, if any, between the expiration of the Term, or most recent renewal term, and the date upon which the new renewal rent is determined by an arbitrator, or otherwise, the Tenant will pay Rent at the rates and in the manner provided for in this Lease for the period immediately preceding the expiry of the Term or most recent renewal term and, following determination of the renewal rent, the Tenant will pay to the Landlord interest, at the rate prescribed in paragraph 15.9 on the excess amount of the renewal rent.

 

(a)

to, on demand, make the due and punctual payment of all Rent, money and charges expressed to be payable under this Lease during the Term and any renewals or extensions thereof and any overholding thereafter;

 

(b)

to effect prompt and complete performance of each obligation in this Lease of the Tenant during the Term and any renewals or extensions thereof or any overholding; and

 

(c)

to indemnify and save harmless the Landlord from any loss, costs or damages, including consequential loss, costs or damages, arising out of any failure by the Tenant or the Indemnifier or any other person liable therefor to pay any Rent, money and charges or the failure to perform any of the terms or conditions of this Lease.

 

(a)

any extension of time, indulgence or modification which the Landlord may extend or make with the Tenant from time to time in respect of the performance of any of the obligations of the Tenant under this Lease;

 

(b)

any waiver by, or neglect or failure of the Landlord to enforce any of the terms of this Lease;

 

(c)

any assignment of this Lease or sublet of the Premises or other Transfer by the Tenant or by any trustee, receiver or liquidator of the Tenant or of the Indemnifier;

 

(d)

any consent which the Landlord may give to any assignment or sublease or other Transfer;

 

(e)

any changes of any kind to this Lease, and the Indemnifier acknowledges that he will advise himself of all changes and the Landlord has no obligation to advise him of any changes;

 

(f)

any act or failure to act of or by the Landlord concerning matters contained in this Lease;

 

(g)

the filing by the Tenant of a proposal or a notice of intention to file a proposal or the repudiation of the Lease under the Bankruptcy and Insolvency Act, as amended or substituted from time to time;

 

(h)

any winding-up, amalgamation, bankruptcy, or receivership of the Tenant or any execution proceedings taken against the Tenant or the release or discharge of the Tenant in any receivership, bankruptcy, winding-up or other creditor's proceeding; or

 

(i)

the expiration or sooner termination of this Lease however arising, including without limitation, whether by operation of law or resulting from the exercise of a trustee in bankruptcy's statutory right to disclaim any interest in this Lease and surrender possession of the Premises to the Landlord, with or without the consent of the Landlord.

 

(a)

If the Tenant defaults under this Lease, the Indemnifier waives any right to require the Landlord to:

 

(i)

proceed against the Tenant or pursue any rights or remedies concerning this Lease;

 

(ii)

proceed against or exhaust any security of the Tenant held by the Landlord; or

 

(iii)

pursue any other remedy whatsoever in the Landlord's power.

 

(b)

The Landlord has the right to enforce this indemnity regardless of the acceptance of additional security from the Tenant and regardless of the release or discharge of the Tenant or any other guarantor or indemnifier in respect of this Lease, whether granted by the Landlord or by others or by operation of law.

 

(a)

The liability of the Indemnifier under this indemnity will not be waived, released, discharged, impaired or affected by reason of the death, bankruptcy or dissolution of the Tenant or by reason of the release or discharge of the Tenant in any receivership, bankruptcy, winding-up or other creditors proceeding or the rejection, or disclaimer of this Lease in any proceeding, and will continue concerning the periods prior to and after, for and concerning the Term and any renewals or extensions of it.

 

(b)

The liability of the Indemnifier will not be affected by any repossession of the Premises by the Landlord, provided however, that the net payments received by the Landlord after deducting all costs and expenses of repossessing or reletting will be credited from time to time by the Landlord in accordance with Part < to reduce the liability of the Indemnifier, and the Indemnifier will pay any balance owing to the Landlord from time to time immediately upon receipt of notice of the amount of the balance.

 

(a)

If the performance of any act required under this Lease to be performed by a party is affected by Unavoidable Delay then:

 

(b)

if the act is to be performed on or at a specified day or time then the day or time for performance will be extended to a day or time after the Unavoidable Delay ceases which is reasonable having regard to the nature of both the act and the Unavoidable Delay; or

 

(c)

if the act is to be performed within a specified period of time that period will be extended from the time the Unavoidable Delay ceases to affect the performance for a period equal to the amount of that specified period which occurred during the period of Unavoidable Delay.

 

(d)

The party obligated to do or perform such act or thing will not be considered to have committed a default until the expiration of such time as so extended.

 

(e)

Each party will when so delayed promptly notify the other of the occurrence of the Unavoidable Delay with an estimate of its expected duration.

 

(a)

Any notice or other communication required or permitted to be given under this Lease will be in writing unless otherwise specified and will be considered to have been given if delivered by hand, transmitted by facsimile transmission or mailed by prepaid registered post in Canada, to the address or facsimile transmission number of the party set out below:

 

(b)

Notice or other communication will be considered to have been received:

 

(i)

if delivered by hand during business hours, upon receipt by a responsible representative of the receiver, and if not delivered during business hours, upon the commencement of business on the next business day;

 

(ii)

if sent by facsimile transmission during business hours, upon the sender receiving confirmation of the transmission, and if not sent during business hours, upon the commencement of business on the next business day; and

 

(iii)

if mailed by prepaid registered post in Canada, upon the fifth business day following posting, except that, in the case of a disruption or an impending or threatened disruption in the postal service, every notice or communication will be delivered by hand or sent by facsimile transmission.

 

 (c)

In this Lease, whenever a notice provision refers to "days", it will be considered to refer to "business days" and "business day" or "business days" will mean a day or days which are not a Saturday or defined as a "holiday" under the Interpretation Act of British Columbia as amended or substituted from time to time.