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Home My WebLink About2003-009 THE CORPORATION OF THE MUNICIPALITY OF CLARINGTON BY-lAW #2003-09 Being a By-law to authorize the execution of a lease Agreement between the Corporation of the Municipality of Clarington and Theatre Dance Academy in respect of a lease for space located in the Courtice Community Complex, Courtice, Ontario. THE CORPORATION OF THE MUNICIPALITY OF CLARINGTON HEREBY ENACTS AS FOllOWS: 1. THAT the Mayor and Clerk are hereby authorized to execute, on behalf of the Corporation of the Municipality of Clarington with the Corporation Seal, a lease Agreement with Theatre Dance Academy and said Corporation; and 2. THAT this agreement attached hereto as Schedule "A" form part of this By-law. By-law read a first and second time this 27th day of January .2003. By-law read a third time and finally passed this 27th day of Ja~uar .2003. 14;~<--~~ John Mutton, ayor :. ~:- ',-- _ .~ _ -_ _, ~ LEASE AGREEMENT ClfJl-ilJgton Municipality of Clarington EXECUTED CONTRACT Page 1 THIS LEASE dated as of the .2.E3day of February ,lM2. 2003 BETWEEN: The Corporation of the Municipality of Clarington (hereinafter called the "Landlord") - and - ~ ' , . . 'Ceei {!~ " ~ " Q/-LA\ to;:' A ( ~ompany Limited, a corporation incorporated wider the laws of the Province of Ontario (hereinafter called the "Tenant") OF THE SECOND PART ----_._~.._---_._-~-~~-- LEASE AGREEMENT 11:\LEASES\2002-THEAmE DANCE DOC LEASE AGREEMENT Page 2 TABLE OF CONTENTS ARTICLE I PREMISES, TERM, OFFER AND USE ............................................................................ 1 1.1 Grant and Premises .................................................................................... 1 1.2 Term ...........................~................................................................................ 1 1.3 Offer to Lease................................................................................................ 1 1.4 Use and Conduct of Business..................................................................... 2 1.5 Nuisance....... ............................................................................................... 2 ARTICLE" RENT .......................................................... ............ ............................... .......... ............ ...... 3 2.1 Covenant to Pay.......................................................................................... 3 2.2 Net Rent ...................................................................................................... 3 2.3 Payment of Taxes ....................................................................................... 3 2.4 Payment of Estimated Taxes and Operating Costs.................................... 4 2.5 Utilities and Services ................................................................................... 4 2.6 Additional Rent ............................................................................................ 4 2.7 Rent Past Due ............................................................................................. 4 2.8 Adjustment of Areas...................................................................................... 5 2.9 Rent Deposit........... ........ .......... ..... ...................................... ..... ................. .... 5 ARTICLE III CONTROL OF BUILDING ................................................................................................ 6 3.1 Landlord's Services ..................................................................................... 6 3.2 Control by Landlord ..................................................................................... 6 ARTICLE IV ACCESS AND ENTRy...................................................................................................... 7 4.1 Access to Premises..................................................................................... 7 4.2 Entry not Forteiture...................................................................................... 8 ARTICLE V MAINTENANCE, REPAIRS AND ALTERATIONS........................................................... 9 5.1 Maintenance by the Landlord ...................................................................... 9 5.2 Maintenance by Tenant, Compliance with Laws, Repair on Notice ........... 9 5.3 Approval of Tenant's Alterations ................................................................ 10 5.4 Repair where Tenant at FaulL.................................................................. 11 5.5 Removal Of Fixtures and Personal Property............................................. 12 5.6 Liens ........................................................................................................... 12 5.7 Notice by Tenant ........................................................................................ 12 ARTICLE VI INSURANCE AND INDEMNITy....................................................................................... 13 6.1 Tenant's Insurance..................................................................................... 13 6.2 Form of Policies.......................................................................................... 14 6.3 Landlord's Insurance .................................................................................. 14 6.4 Release of Landlord ................................................................................... 14 6.5 Tenant's Effect on Other Insurance ........................................................... 15 6.6 Indemnity of Landlord ................................................................................. 16 H:\LEASES\2002-THEATRE DANCE.DOC LEASE AGREEMENT 6.7 6.8 Page 3 Loss or Damage ......................................................................................... 17 Benefit of Releases .................................................................................... 18 ARTICLE VII DAMAGE AND DESTRUCTION...................................................................................... 19 7.1 Damage to Premises, Building or Development..:..................................... 19 7.2 Ineured Damage to Premises..................................................................... 19 7.3 Uninsured Damage to Premises and Last Two years............................... 19 7.4 Damage to Building or Development ......................................................... 20 7.5 Termination.................:............................... ................................... ............. 20 7.6 Restoration if Lease Not Terminated ......................................................... 20 7.7 Restoration of Premises or Building and Insurance Proceeds .................. 21 7.8 Determination of Matters............................................................................. 21 7.9 Limitation of Liability ................................................................................... 21 ARTICLE VIII TRANSFERS .......... ........... ............................................ ..... ........................................ ...... 22 8.1 Transfers .................................................................................................... 22 8.2 Landlord's Right to Terminate .................................................................... 22 8.3 Conditions of Transfer ................................................................................ 22 8.4 Change of Control...................................................................................... 23 8.5 No Advertising ............................................................................................ 23 8.6 Assignment by Landlord............................................................................. 23 ARTICLE IX DEFAULT ....................................................................... ................................. ................. 24 9.1 Default and Remedies................................................................................ 24 9.2 Distress....................................................................................................... 25 9.3 Costs ............... ..... ...... ..... ..... ..... ......... .................. ........ ............. ..... ....... ..... 25 9.4 Set-Off and Accord and Satisfaction.......................................................... 25 9.5 Survival of Obligations................................................................................ 25 9.6 Lien.. ....... .... ....... ... ..... ... ..... ... ....... ....... ............. ............. ... ..... .......... ....... ..... 26 9.7 Waiver and Remedies Cumulative............................................................. 26 ARTICLE X SPECIAL PROViSiONS................... ............... .......... ..... ..... ... ..... ........ .......... ........ ....... .... 27 10.1 Parking ....................................................................................................... 27 10.2 Extension or Renewal................................................................................ 27 10.3 Operation of a Dance School..................................................................... 27 10.4 Physical Plant and Equipment ................................................................... 27 10.5 Management and Operation of Premises .................................................. 28 10.6 Disposal of Waste ...................................................................................... 28 10.7 Quality Control............................................................................................ 28 10.8 Sponsorship and Advertising Sales ........................................................... 29 10.9 Marketing and Advertising.......................................................................... 29 10.10 Concessions/Catering ................................................................................. 29 ARTICLE XI GENERAL PROViSiONS................. ... ..... .......... ....... ..... ... ..... .......... ... .......... ... ....... ..... .... 30 11.1 Rules and Regulations ............................................................................... 30 11.2 Delay........................................................................................................... 30 11.3 Overholding ................................................................................................ 30 11.4 Notices.................................................................. . 30 11.5 Successors ...........................................................:::. .:................................ 30 11.6 Covenants and Joint and Several Liability ..............:..:::::::::::::::::::::::::::::::: 31 H;\LEASESI2002-THEATRE DANCE.DOC THIS LEASE is made the _ day of ,2002 BETWEEN: THE CORPORATION OF THE MUNICIPALITY OF CLARINGTON (the "Landlord") OF THE FIRST PART - and - Theatre Dance Academv (the ''Tenant'') OF THE SECOND PART IN CONSIDERATION of the rents, covenants and agreements hereinafter contained, the parties covenant and agree as follows: ARTICLE I PREMISES. TERM. OFFER AND USE 1.1 Grant and Premises In consideration of the performance by the Tenant of its obligations under this lease, the Landlord leases to the Tenant, and the Tenant leases from the Landlord, for the Term, the Premises comprising both (1) the interior area shown outlined in red on the floor plan contained in Schedule "B" attached hereto in the Building known as of the date of this lease as the Courtice Community Complex. The purpose of the floor plan is to show the approximate location of the interior area which comprise the Premises. Schedule "B" is not intended to be a representation as to the precise size or dimensions of the Premises or a representation as to any other aspect of the Building or the development of any portion of the Lands. The Rentable Area of the interior space within the Building is approximately 1,600 square. 1.2 Term The Term of this lease shall commence on "February 1,2003" in accordance with the offer to lease and shall terminate on the day which is five (5) years after the Commencement Date. provided that prior to the expiry of the Term the Landlord's Council resolves that the Landlord wishes to lease the Premises for a further term commencing on a day within the two (2) month period which commences on the day following the date of expiry of the Term, the Landlord and Tenant shall use their best efforts to settle the terms and conditions of the new lease or an extension of this lease of the Premises. 1.3 Offer to Lease The provisions of the agreement to lease dated December _ . 2002 among the Landlord and the tenant, with respect to the Premises (the offer to Lease) shall merge upon the execution and delivery of this lease. H:\LEASES\2002-lIll'ATRE DANCEDOC Page 2 1.4 Use and Conduct of Business Throughout the Term, the interior area of the Premises shall be used and occupied only for the purposes of a dance school facility. Throughout the Term, the Tenant shall continuously, actively and diligently carry out the use and occupation of the Premises as aforesaid in compliance with all applicable laws and the provisions of this lease, and shall not use or occupy or permit or suffer the use or occupancy of the Premises or any part thereof for any other purpose or business. 1.5 Nuisance The Tenant shall not commit, permit or suffer (i) any waste, damage or injury to the Premises or the Building or any part thereof, including, without limitation, the improvements, installations, fixtures and equipment thereon or therein; (ii) any nuisance in or on the Premises or Building or any part thereof; (iii) any overloading of any utility or electrical or mechanical equipment, facilities or systems serving the Premises; or (iv) systems serving the Premises; (iv) any act or thing or use of the Premises in any manner which disturbs the quiet enjoyment, annoys or causes a hazard to the Landlord or occupant of the Building or any part thereof, all as determined by the Landlord in its sole discretion, acting reasonably. II:\LEASES\2002. J HEII,TRE DANCE DOC LEASE AGREEMENT Page 3 ARTICLE II RENT 2.1 Covenant to Pay The Tenant shall pay Rent in lawful money of Canada from the Commencement Date without prior notice or demand except as may be otherwise expressly provided in this lease. Rent shall be considered as accruing from day to day. Where it becomes necessary for any reason to calculate Rent for an irregular period of less than one year or less than one calendar month, an appropriate apportionment and adjustment shall be made, pro rata on a per diem (365 day year) basis. Except as may be otherwise expressly provided in this lease, if the Commencement Date does not fall on the first day of a calendar month, the Tenant shall pay Rent for such month on the Commencement Date. The Tenant agrees that its covenant to pay Rent is an independent covenant and that all such amounts are payable without demand, counterclaim, set-off, deduction, abatement, compensation or reduction whatsoever, except as maybe otherwise expressly provided in this lease. The Tenant shall deliver post-dated cheques to the Landlord prior to each Rental Year for Net Rent and estimated Additional Rent as required by the Landlord. Rent payable to the Landlord shall be paid to the Landlord at its address for notice pursuant to Section 11.4. 2.2 Net Rent The Tenant shall pay to the Landlord, or to such Person as the Landlord may direct from time to time, Net Rent of $17,600.00 (seventeen thousand, six hundred) which shall be payable in equal consecutive monthly instalments of $1466.60 (fourteen hundred and sixty six dollars and sixty cents) in advancJn the first calendar month of the Term commencing on the Commencement Date N :~~per annum of $17,600.00 (seventeen thousand, six hundred) is based on ~'n "1'.00 (eleven dollars) p.s.f. per annum of the Rentable Area of the Premises, being 1,600 square feet for the term February 1,2003 to January 31,2008. 2.3 Payment of Taxes (a) The Tenant shall pay to the Landlord no later than the due date therefor, as the Landlord may direct from time to time, by written notice to the tenant, all Taxes allocated and attributed by the Landlord to the Leasable Area of the Premises as Additional Rent. (b) The Landlord shall pay all Taxes to the taxing Authorities, including to itself to the extent that its interest in the Building and the Lands is not exempt from taxation. (c) The Tenant shall pay to the Landlord, upon demand, as Additional Rent any increase or amount of Taxes or other taxes which the Landlord, acting reasonably, determines to be attributable to any act or election by the Tenant (for example declaring itself a separate school supporter) or to be attributable to the Leasehold Improvements. (d) The Tenant may contest any Taxes and appeal any assessments with respect thereto, withdraw any such contest or appeal, and agree with the taxing Authoritie~ on any settlement or compromise with respect to Taxes. (e) Notwithstanding the foregoing or any other provisions of this lease to the contrary, after demand therefor is made in writing by the Landlord to the Tenant (i) the Tenant shall pay to the Landlord an amount determined by the Landlord to be equal to or in respect of any and all Sales Taxes, it being the intention of parties that the Landlord shall be fully paid and reimbursed by the Tenant with respect to any and all Sales Taxes paid or payable by the Landlord or the Tenant and/or which the Landlord is required to remit to any Authority, and, except as may be otherwise expressly provided in this lease, the amount of such Sales Taxes so payable by the Tenant to the Landlord shall be calculated by the Landlord in accordance with the applicable legislation, and shall be paid to the Landlord, at the Landlord's option, when due or at the same time as the amounts to which such Sales Taxes apply are payable to the Landlord under the terms of this lease or upon demand or at such other time or times as the Landlord from H:\LEASES\2002-THEA IFE DANCE. DOC LEASE AGREEMENT Page 4 time to time determines and (ii) the amount of such Sales Taxes so payable by the Tenant shall be deemed not to be Rent, but the Landlord shall have all of the same remedies for and rights of recovery of such amount as it has for recovery of Rent under this lease. 2.4 Payment of Estimated Taxes and Operatina Costs (a) The amount of Taxes and Sales Taxes may be estimated by the Landlord for each Rental Year or for such shorter period as the Landlord determines from time to time. The Tenant shall pay to the Landlord the amounts so estimated in equal instalments in advance on the first day of each month during each such period. Notwithstanding the foregoing, when bills for all or any portion of the amounts so estimated are received, the Landlord may bill the Tenant for the billed amounts after crediting against such amounts any monthly payments on account of estimated Taxes and Sales Taxes previously made by the Tenant, and the Tenant shall pay to the Landlord the amounts so billed to the Tenant on demand. (b) Any and all allocations, attributions and determinations of or with respect to Taxes or Sales Taxes, Business Tax, other taxes, Utilities and special services under this lease shall be made by the Landlord in accordance with and subject to the provisions of this lease, on such basis as the Landlord may determine, acting reasonably, in its sole discretion from time to time. 2.5 Utilities and Services (a) The cost of utilities, that being water, hydro, and heat are included in the total stipulated price per square foot for the rentable area. (b) In no event shall the Landlord be liable for, nor shall the Landlord have any obligation with respect to, any interruption or cessation of, or any failure in the supply of, any Utilities, services or systems whatsoever in, to or serving the Building or Premises, or any part thereof, whether or not supplied by the Landlord or others. (c) The Tenant shall pay to the Landlord, on demand, as Additional Rent, all charges as determined, allocated and attributed by the Landlord, for all special services provided to or for the benefit of the Tenant or the Premises. Such special services may include, without limitation, charges for security, supervision, receiving, storing and handling materials and articles, and moving of furniture, as determined by the Landlord from time to time. The Tenant, from time to time, may request such special services from the Landlord and the Landlord shall have the right to provide them. If the Landlord elects not to provide them, then they shall be provided only by Persons approved in writing by the Landlord acting reasonably. Unless otherwise expressly agreed to by the Landlord and Tenant to the contrary, all work, materials and special services performed or supplied by the Landlord for the Tenant or respecting the Premises shall be paid for by the Tenant to the Landlord upon demand at the Landlord's cost. 2.6 Additional Rent Except as may be otherwise expressly provided in this lease, all Additional Rent shall be payable by the Tenant to the Landlord on demand. 2.7 Rent Past Due All Rent and any and all other amounts payable by the Tenant under this lease unpaid and past due shall bear interest from the due date thereof to the date of payment as a variable rate per annum which is 3% in excess of the Prime Rate, and such interest shall be both calculated and compounded monthly and shall be payable on demand. H:\LEASES\2002-THEATRE DANCEDOC Page 5 2.8 Adiustment of Areas (a) If for any reason the Architect is unable to accurately verify, on or before the Commencement Date, any area measurement required for the determination of Rent, the Landlord shall provide its reasonable area estimate and shall deliver to the Tenant, as soon as reasonably possible after completion of construction, the Architect's accurate verification certificate on which such Rent shall be based, which certificate shall be binding upon the parties and shall form part of this lease, subject to Section 2.8(b). In the intervening period, discrepancies between such estimated and verified area shall be made promptly following the Architect's verification of such area. (b) In the event of any dispute as to the measurement or calculation of areas relating to (i) the Rentable Area of the Premises or (ii) the Useable Area of the Premises, such shall be determined by the Architect. The decision, determination or opinion of the Architect, whenever required by this lease (or requested by the Landlord) and any related certificate shall be final and binding on the partiers. 2.9 Rent Deposit The Landlord acknowledges receipt of a deposit in the amount of $1466.66 from the Tenant, to be applied as a deposit against Net Rent accruing due in the first full month and second month of the Term for which Net Rent is payable. Any interest earned on such deposit shall be retained by the Landlord and shall not be payable to the Tenant nor applied towards Rent payable under this lease. HiLEASES\2002- THEATRE DANCE DOC L.E:..M.i:>E:..M.uf"(t:tMtl"'l Page 6 ARTICLE III CONTROL OF BUILDING 3.1 Landlord's Services The Landlord shall provide or cause to be provided reasonable services for the Common Facilities and snow removal from the parking area and pedestrian walkways on the Lands. 3.2 Control bv Landlord (a) The Tenant acknowledges that the Building is at all times subject to the exclusive control, management and operation of the Landlord who shall act reasonably in respect of the Premises. Without limiting the generality of the foregoing, the Landlord shall have the right, but not the obligation, in its control, management and operation of the Building or any part thereof and at all times throughout the Term: (i) to maintain, repair, replace, complete construction of, alter, add to, subtract from, construct improvements and replacements to, rearrange, build additional storeys on and construct additional facilities in, on, adjoining or near, the Building or any part thereof, and to obstruct or close off all or any part of the Building or Premises in connection therewith; (ii) to employ or retain all personnel necessary for the control, management, operation, supervision and administration of the Building and Premises or any part thereof including, without limitation, administrative personnel and managers (the Tenant hereby acknowledging that the Building may be managed by any Person designated by the Landlord); (iii) to do such things on, in or near the Building or any part thereof, as required to comply with any laws, by-laws, regulations, orders, directives, agreements, licences, privileges, easements or rights of way affecting the Building, or any part thereof; (iv) to obstruct, lock-up or close off all or any part of the Building or any part thereof, for security purposes; (v) to enter into, grant, modify, amend or terminate, on such terms and conditions as the Landlord, in its sole discretion, may determine, any easements, rights of way, privileges, licences or agreements with respect to any use or occupancy of, or any maintenance, repair, replacement, Restoration or reconstruction of, or supply of any services to, or any operation of, the Building and Premises, or any part thereof; and (vi) to do such other things on, in or near the Building and Premises or any part thereof, as the Landlord, in any use of good business judgment, determines to be advisable. (b) The Tenant acknowledges and confirms the rights of the Landlord referred to in this Section 3.2, including, without limitation, the right to expand, rearrange or add to the Building and Premises from time to time, but such acknowledgment and confirmation shall not be construed or deemed in any respect to be any obligation or covenant by the Landlord to exercise such rights. The Landlord, in its sole discretion, shall determine the extent to which it elects to exercise any of such rights, subject to its express obligations contained in this lease. (c) Tenant agrees that it shall not hinder or oppose the Landlord in the exercise by the Landlord of its rights referred to in this Section 3.2. (d) Subject to and in compliance with the other provisions of this lease, the Rules and Regulations and all laws and requirements of all Authorities, the Tenant shall have the non-exclusive licence during the Term to have access through or to use in common with all others entitled thereto and for their intended purposes such portions of the Building and the Lands as are reasonably required for access to or the use and occupancy of the Premises for their intended purposes during such hours as such Building and Lands are intended to be open for such access or use, as the case may be, all as determined, designated, redesignated and as may be changed by the Landlord from time to time. II:\LEASES\2()02-THEATF~E DANCE DOC LEASE AGREEMENT Page 7 ARTICLE IV ACCESS AND ENTRY 4.1 Access to Premises (a) The Landlord, without limiting any other right which the Landlord may have pursuant to this lease or at law, shall have the right, but not the obligation, following reasonable written notice to the Tenant (except in the case of an emergency or apprehended emergency where no such notice shall be required), to enter the Premises at any time and for any of the following purposes: (i) to examine the Premises or to perform any maintenance, repairs, replacements, alterations or improvements to the Premises or any part thereof as may be permitted or required by this lease, or to perform any maintenance, repairs, replacements, alterations or improvements to the Building, or any part thereof or to the HV AC System or to any mechanical or electrical equipment or systems, or any part thereof, located therein serving the Premises or any other part of the Building or to perform any environmental audit or testing; (ii) to preserve and protect the Building and Premises, or any part thereof in respect of any construction or other work being performed in premises adjoining or in the vicinity of the Building or the Premises, or in any part of the Lands or in the vicinity thereof; (ill) for any purposes as determined by the Landlord in cases of emergency; (iv) to read any Utility or other similar meters located in the Premises; (v) during the last twelve months of the Term (or any renewal or extension Term if renewed or extended), but only during normal operating hours, to show the Premises to prospective tenants, and to permit them to make inspections, measurements and plans; (vi) to exercise any of the rights available to the Landlord pursuant to this lease or to perform such work in respect of the Building or Development, or any part thereof, as the Landlord shall deem necessary. (b) The Landlord shall have the right to install, maintain, use, repair, replace, alter, calibrate, adjust, balance, check and inspect pipes, ducts, conduits, vents, wires, access panels to mechanical shafts and other installations in or leading in, through, over or under the Premises including, without limitation, other elements of any mechanical or plumbing systems or HVAC System or systems for Utilities, telephone and other communications systems and any other systems which serve the Building or the Premises, or any part thereof, and the Landlord shall have access to the foregoing and the right to enter the Premises for the purposes thereof and in connection therewith at any time following reasonable notice to the Tenant except in the case of an emergency or apprehended emergency for which no notice shall be required. The Tenant shall not unduly obstruct any pipes, conduits or mechanical or other electrical equipment or systems so as to prevent reasonable access thereto. H:\L[ASES\2002-THEATRE DANCE.DOC Page 8 (c) The Landlord shall have the right to take into the Premises all such material and equipment as it may require in connection with any of the purposes referred to in this Section 4.1. The Landlord shall exercise its rights under this Section 4.1, to the extent reasonably possible in the circumstances, in such manner and at such times as the Landlord, acting reasonably but in its sole discretion, shall determine, and to the extent practical in the circumstances, so as to minimize interference with the Tenant's use and enjoyment of the Premises. (d) At any time that entry by the Landlord is desired in case of emergency or apprehended emergency, and if no personnel of the Tenant are known by the Landlord to be present on the Premises or if such personnel fail for any reason to provide to the Landlord immediate access at the time that such entry is desired, the Landlord may forcibly enter the Premises without liability for damage caused thereby. This Section 4.1 is not intended to impose any obligations, responsibilities or liabilities on the Landlord nor is it intended to limit the rights of the Landlord or the obligations of the Tenant under any other Section of this lease, including, without limitation, Section 3.2. 4.2 Entry not Forfeiture Notwithstanding anything contained in this lease, the exercise by the Landlord of any of its rights under this lease, including, without limitation, (i) its rights set out in this Section or in Sections 3.2, 4.1, 5.1, 5.2(c) and 6.5(c) and (ii) the exercise of any right under this lease to enter the Premises and to do anything therein, shall not constitute a breach of any covenant for quiet enjoyment, or a constructive or actual eviction, or a re-entry or forfeiture (except where expressed by the Landlord in writing), nor shall it render the Landlord liable for any injury, loss, costs or damages whatsoever, howsoever caused, whether direct or indirect, incurred as a result thereof by the Tenant, nor shall the Tenant be entitled to any compensation, diminution or abatement of Rent (except as may be otherwise expressly provided in this lease). H:\LEASES\2002- THEA TRE DANCE DOC L~"'~ 1"\l..:J"C:CIVICI" I Page g ARTICLE V MAINTENANCE, REPAIRS AND ALTERATIONS 5.1 Maintenance bv the Landlord (a) The Landlord, at all times throughout the Term, but subject to Section 5.2, Article VII and the other provisions of this lease imposing maintenance, repair or replacement obligations or liabilities upon the Tenant, shall maintain, repair and replace or cause to be maintained, repaired and replaced, as would a prudent owner of a reasonably similar building, having regard to size, age and location, reasonable wear and tear excepted: (i) the structure of the Building including, without limitation, the foundations, exterior wall assemblies (including weather walls), sub-floor, roof, bearing walls and structure columns and beams of the Building; and (ii) the mechanical, fire alarm, HVAC System, electrical and other base building equipment, facilities and systems and plumbing fixtures and equipment located in or serving the Premises. (b) The Landlord shall not be responsible for any damages howsoever caused to the Tenant by reason of delays in the performance of any maintenance, repairs, replacements or any other work for which the Landlord is responsible under this lease. The Landlord shall have the right at any time to stop, interrupt or reduce any services, facilities, systems or Utilities provided to or serving the Building, the Premises, or any part thereof, to perform repairs, replacements, improvements, alterations, maintenance, Restoration, adjustments, calibrations or balancing or to comply with laws or regulations, or binding requirements of its insurers, or for causes beyond the Landlord's reasonable control or as a result of the Landlord exercising any of its rights under this Section 5.1 or Sections 3.2, 4.1, 5.2(c), 6.5(c) or other Sections of this lease in cases where the Landlord determines such is prudent or reasonably required. The Landlord shall not be in breach of any covenant for quiet enjoyment or liable for any injury, loss, costs or damages whatsoever, howsoever caused, whether direct or indirect, incurred by the Tenant due to any of the foregoing, and such shall not constitute a constructive or actual eviction or a re-entry or forfeiture (except where expressed by the Landlord in writing). The Landlord shall make reasonable efforts to restore the services, facilities, Utilities or systems so stopped, interrupted or reduced. The Tenant acknowledges and agrees that it may require one year after the Tenant has fully occupied the Premises in order to adjust and balance the HVAC system and the Landlord shall not be responsible for any inconvenience, discomfort, damages, loss or claims whatsoever arising out of the process of such adjustment or balancing. 5.2 Maintenance bv Tenant. Compliance with Laws. Repair on Notice (a) The Tenant, at all times throughout the Term, at its sole expense, shall maintain and keep the whole of the Premises, including, without limitation, all Leasehold Improvements, equipment and appurtenances thereto, furniture, fixtures, and improvements thereto, in good order, first-class condition and repair as a careful prudent owner would do and in a clean, sanitary and tidy condition (which shall include, without limitation, periodic painting and redecoration), to a standard consistent with a first-class public building, all as determined by the Landlord, and, subject to Article VII, the Tenant shall make all needed repairs and replacements thereto with due diligence and dispatch as a careful prudent owner would do except only for repairs and replacements for which the Landlord is expressly responsible under Section 5.1. H\LEASES\2002-THEATRE DANCE. DOC LEASE AGREEMENT Page 10 (b) The Tenant, at its own expense, (i) shall promptly comply, and shall promptly provide to the Landlord evidence, satisfactory to the Landlord of such compliance, with all laws, by-laws, govemment orders and requirements of all Authorities and with all reasonable requirements or directives of the Landlord's insurers and other Authorities affecting or relating to the Premises or their use, maintenance, repair, replacement or Alteration or any business conducted in or from the Premises, including, without limitation, obtaining all necessary permits, licenses and approvals relating to the use and occupancy of the Premises and the conduct of business in or from the Premises, and shall be responsible for and shall promptly perform all necessary Alterations and changes to the Premises and contents thereof and such business, use and occupancy to so comply and (ii) shall (I) co-operate with the Landlord in, and comply with all laws, by-laws, regulations and orders of all Authorities relating to, the conservation of all forms of energy in and serving the Building or the Premises or any part thereof, and (II) comply with all reasonable requests and demands by the Landlord made with a view to energy conservation. (c) In addition to the obligations of the Tenant under Sections 5.2(a) and (b) and any other similar provisions of this lease, the Tenant shall perform all maintenance, repairs, replacements and other work referred to therein according to written notice from the Landlord. If the Tenant fails to perform any maintenance, repairs, replacements or other work required to be performed by it under Sections 5.2(a) or (b) or any other similar provision of this lease promptly and to the reasonable satisfaction of the Landlord, or if the Tenant, after written notice from the Landlord, fails to perform any maintenance, repairs replacements or other work promptly as required under this lease and such notice and to the reasonable satisfaction of the Landlord, the Landlord shall have the right, but not the obligation, to perform such maintenance, repairs, replacements or other work and to enter the Premises in connection therewith without any liability for any resulting damage or loss whatsoever to the Tenant's property or business howsoever caused by reason thereof. The Cost of such maintenance, repairs, replacements and other work, representing the Landlord's overhead, shall be paid by the Tenant to the Landlord on demand. The Landlord's failure to give any such notice shall not (i) relieve the Tenant from its obligations to perform any such maintenance, repairs, replacements and other work under this lease nor (ii) prejudice the Landlord's right to perform any such maintenance, repairs, replacements or other work at the Tenant's cost as provided above. 5.3 Approval of Tenant's Alterations (a) No Alterations shall be made to the Premises without the Landlord's and any required Authority's prior written approval. The Tenant shall submit to the Landlord details of the proposed Alterations, including, without limitation, plans, drawings and specifications prepared by qualified architects or engineers in conformity with the Landlord's then current Building standards. All such Alterations shall be performed: (i) at the sole cost of the Tenant; (ii) by contractors and workmen designated, provided or approved by the Landlord; (iii) in a good and workmanlike manner; (iv) in accordance with plans, drawings and specifications approved in writing by the Landlord and, where required, by the Authorities; (v) in accordance with all applicable legal and insurance requirements; (vi) subject to the reasonable regulations, supervisor control and inspection by the Landlord; and (vii) subject to providing, and only after there is provided, to the Landlord such indemnification against liens and expenses and evidence of such additional Tenant's insurance as the Landlord may reasonably require; all as determined by the Landlord. H:\LEASES\2002- THEATRE DANCE,DOC LEASE AGREEMENT Page 11 (b) If, in the Landlord's opinion any Alterations or maintenance would affect the structure of the Development or any part thereof or any of the HV AC System or electrical, plumbing or mechanical equipment, facilities or systems or other base building equipment, facilities or systems, then at the option of the Landlord, such work shall be performed by the Landlord at the Tenant's cost. On completion of such work, the Tenant shall pay to the Landlord, on demand, the cost of such work, all as determined by the Landlord. No Alterations or maintenance to the Premises by or on behalf of the Tenant shall be permitted which may weaken or endanger the structure of, or adversely affect the condition or operation of the Premises or Building or any part thereof. (c) Whether or not the Landlord pays its approval to any Alterations, the Tenant shall pay to the Landlord, on demand, as Additional Rent, all of the Landlord's reasonable costs (including, without limitation', fees and disbursements of architects, engineers and designers) incurred in reviewing, consulting in respect of, approving, inspecting and supervising any and all such Alterations. The Landlord shall have the right to require the Tenant to make a payment to the Landlord in respect of such costs as a precondition to the Landlord's granting any necessary approval herein. Such reasonable costs shall be deemed to include, without limitation, all amounts paid or payable by the Landlord to third parties, all reasonable charges of the Landlord for its own personnel. (d) The Landlord's approval of any alterations or plans, drawings or specifications with respect thereto shall not constitute a waiver by the Landlord of the Tenant's obligations herein to comply with all laws and the requirements of all Authorities with respect to such Alterations nor any acknowledgment or agreement by the Landlord that such have been complied with. 5.4 Repair where Tenant at Fault Notwithstanding any other provisions of this lease including, without limitation, Article VII, if the Building, the Premises, or any part thereof (including, without limitation all or any part of the wiring and electrical, lighting and plumbing fixtures and equipment, the HVAC System and any other base building equipment, facilities and systems) is damaged or destroyed or requires repair, replacement or alteration as a result of the act or omission of the Tenant, its employees, agents, invitees, licensees, contractors or others for whom it is in law responsible, the cost of the resulting repairs, replacements or alterations plus a sum equal to fifteen percent (15%) of such cost representing the Landlord's overhead, to the extent required by the Landlord by written notice to the Tenant, shall be paid by the Tenant to the Landlord on demand. H:\LEASESi2002-THEATRE DANCE DOC LEASE AGREEMENT Page 12 5.5 Removal Of Fixtures and Personal Propertv All Leasehold Improvements (other than Tenant's fixtures) shall immediately upon their placement become the Landlord's property without compensation to the Tenant. Except as may be otherwise agreed by the Landlord in writing, no Leasehold Improvements shall be removed from the Premises by the Tenant either during or at the expiry or earlier termination of the Term. The Tenant may, during the Term, in the usual course of its business, remove its fixtures, provided that the Tenant is not in default under this lease and provided that such fixtures have become excess to the Tenant's needs or the Tenant is substituting new and similar fixtures therefor. The Tenant, at the expiration or earlier termination of the Term, at its cost, (I) shall remove such of the Tenant's fixtures (excluding Leasehold Improvements) and Tenant's personal property in the Premises as the Landlord shall require, (II) shall restore the Premises to the Landlord's then current Building standard (including, without limitation the removal and disposal of any and all hazardous or toxic substances and containers therefor in accordance with all applicable laws and the requirements of all Authorities) to the extent required by the Landlord and (III) shall otherwise peaceably surrender and deliver up vacant Possession of the Premises to the Landlord. The Tenant, at its cost, shall repair any damage caused to the Building or any part thereof by such removal or restoration. If the Tenant does not remove its fixtures and personal property at the expiry or earlier termination of the Term, then, at the option of the Landlord and without prejudice to any other rights or remedies available to the Landlord, the fixtures and personal property shall become the absolute property of the Landlord without payment of any compensation therefor to the Tenant and, without notice to the Tenant, may be removed from the Premises and sold or disposed of by the Landlord in such manner as it deems advisable, all without any liability whatsoever to the Tenant. If the Tenant fails to repair any such damage or complete any work, removal, disposal or restoration referred to in this Section by the expiry or earlier termination of the Term, the Tenant shall be responsible for, and shall indemnify and save harmless the Landlord from and against, all expenses, losses and damages caused by such failure, including, without limitation, the damages suffered by the Landlord for loss of use of the Premises and the cost of removing and selling or disposing of such fixtures and personal property and restoring the Premises to the Landlord's then current Building standard. The Landlord's rights and the Tenant's obligations under this Section shall survive the expiration or earlier termination of the Term. 5.6 Liens The Tenant shall promptly pay for all materials and services supplied and work done in respect of the Premises so as to ensure that no lien is registered against any portion of the Premises or Development or against the Landlord's or Tenant's interest therein. If a lien is registered or filed, the Tenant shall discharge it at its expense within 10 days thereafter, failing which the Landlord, at its option, may discharge the lien by paying the amount claimed to be due into court or directly to the lien claimant and the amount so paid and all expenses of the Landlord including, without limitation, legal fees (on a solicitor and his client basis) shall be paid by the Tenant to the Landlord on demand. 5.7 Notice bv Tenant The Tenant shall promptly notify the Landlord of any accident, defect, damage or deficiency (including, without limitation, any existence, discharge, spillage or leakage of any hazardous or toxic substances or any notice to the Tenant in connection therewith) in any part of the Premises or the Building, which comes to the attention of the Tenant, its employees or contractors notwithstanding that the Landlord may have no obligation in respect thereof. H:\LEASES\2002-THEA TRE DANCE. DOC Page 13 ARTICLE VI INSURANCE AND INDEMNITY 6.1 Tenant's Insurance The Tenant shall obtain and maintain in full force and effect at its sole cost, at all times during the Term and such other times, if any, as the Tenant occupies or is in possession of the Premises or any portion thereof: (a) "all risks" property insurance, not less broad than the standard commercial property floater policy with the exclusions such as, without limitation, those relating to sprinkler leakages (where applicable), earthquake and flood removed therefrom, on all property owned by the Tenant or for which it is legally liable or installed or affixed by or on behalf of the Tenant and which is located In the Premises or the Building including, without limitation, furniture, Tenant's fixtures, equipment, stock-In-trade, inventory and Leasehold Improvements, in an amount not less than the full replacement cost thereof and with a replacement cost endorsement, agreed amount co-insurance clause, by-law endorsement, disputed loss provisions and with reasonable deductibles of not more than 3% of the replacement cost of the property insured, and such insurance policies shall name as insured the Landlord; (b) comprehensive general liability insurance including, but not limited to, property damage, public liability, personal injury liability, broad blanket contractual liability, products and completed operations, non-owned automobile (including contractual) liability, employers' liability, intentional acts to protect persons or property and owners' protective insurance coverage, all on an occurrence basis, with respect to any use, occupancy, activities or things of, in, on or about the Premises and with respect to any use, occupancy or activities of, in, on or about any other part of the Building or the Lands by the Tenant or any of its servants, agents, contractors or Persons for whom the Tenant is in law responsible, with coverage for anyone occurrence or claim of not less than Two Million Dollars ($2,000,000.00) or such other amount as the Landlord may reasonably require upon not less than one (1) month's notice at any time, and with provisions for cross liability and severability of interests, and such insurance shall name as insured the Landlord,; (c) "all risks" tenant's legal liability insurance for the actual cash value of the Premises including, without limitation, the loss of use of the Premises, with limits satisfactory to the Landlord, .acting reasonably, from time to time; (d) insurance in the Tenant's own name with respect to risk of business interruption to the extent which is sufficient in the Landlord's opinion to permit the Tenant to meet its on-going obligations to the Landlord under this lease; and (e) any other form of insurance that the Landlord, acting reasonably, requires from time to time upon not less then 30 days written notice, in form and substance, in amounts, for insurance risks and containing such endorsements and agreements required by and acceptable to the Landlord. 6.2 Form of Policies (a) Each policy required pursuant to Section 6.1 shall be in form and substance and with insurers reasonably acceptable to the Landlord, with loss payable to the Landlord and with insurance proceeds assigned to the landlord under the policies referred to in Sections 6.1 (a). Each of the Tenant's insurance policies shall contain (i) an undertaking by the insurers under such policies that no material change adverse to the Landlord or Tenant will be made and the policy will not be cancelled or terminated, except after not less than 30 days written notice by registered mail to the Landlord and the Tenant of the intended change, cancellation or termination and (ii) a clause stating that the Tenant's insurance policy shall be primary insurance and shall not call into contribution and shall not be excess to any other insurance that may be available to the Landlord. Each of the policies referred to in Section 6.1 (a) and (b) shall contain (i) a waiver of any rights of subrogation or indemnity or any other claim which the insurers of the Tenant may have against the Landlord, its agents, officers or employees and (ii) a waiver, in H:\LE'ASES\2002-THEATRE DN,CE.DOC LEASE AGREEMENT Page 14 respect of the interests of the Landlord of any provision in any such insurance policies with respect to any breach or violation of any warranties, representations, declarations or conditions contained in such policies. (b) The Tenant shall provide to the Landlord for acceptance prior to the earlier of the Commencement Date and the date it occupies the Premises for any purpose, evidence of such insurance in and completed in accordance with the Landlord's standard form of certificate of insurance or, if required by the Landlord, evidence in the form of copies of the policies certified to be true copies by an officer of the insurer and signed by the insurer. In addition, upon request by the Landlord or upon the placement, renewal, amendment or extension of all or any part of such insurance, the Tenant shall immediately provide to the Landlord evidence of such insurance in and completed in accordance with the Landlord's standard form of certificate of insurance or, if required by the Landlord, evidence in the form of copies of the policies certified to be true copies by an officer of the insurer and signed by the insurer. (c) The cost or premium for each and every such policy shall be paid by the Tenant prior to the due date therefor. If the Tenant fails to take out or maintain such insurance or fails to provide to the Landlord such certified copies of insurance and certificates of insurance as herein required, or if any such insurance is not acceptable to the Landlord [and if the Tenant fails to commence to diligently rectify and thereafter proceed to diligently rectify the situation within 48 hours after written notice by the Landlord to the Tenant (stating, if the Landlord, from time to time, does not approve of such insurance, the reasons therefor)], then the Landlord shall have the right, but not the obligation, to do so, and to pay the cost or premium therefor, without prejudice to any other rights or remedies of the Landlord under this lease or at law, and in such event the Tenant shall repay to the Landlord, as Additional Rent, on demand the amount so paid. 6.3 Landlord's Insurance (a) The Landlord shall maintain during the Term, in those reasonable amounts, and with those reasonable terms, conditions and deductions that a prudent owner of a building similar to the Building would maintain, having regard to size, age and location, (i) "all risks" property insurance and boiler and machinery insurance on the Building (except property that the Tenant or other tenants are required to insure), (ii) rental income insurance with such period of indemnity as the Landlord may determine, (iii) public liability insurance with respect to the Landlord's operations and (iv) such other form of insurance as the Landlord reasonably considers advisable, from time to time. (b) Notwithstanding the Landlord's covenant to insure and the Tenant's payment of or contribution to the Landlord's costs and premiums respecting such insurance pursuant to the provisions of this lease, except to the extent, if any, expressly set forth in this lease or in any such policy of insurance obtained by the Landlord, (i) the Tenant shall not be relieved of any liability arising from or contributed by its negligence or its wilful acts or omissions, (ii) no insurable interest or other interest or benefit (including, without limitation, an implied waiver of subrogation from the Landlord's insurers is or shall be conferred upon the Tenant under the Landlord's insurance policies and (iii) the Tenant has and shall have no interest in or right to receive proceeds under any of the Landlord's insurance policies. 6.4 Release of Landlord The acquisition and maintenance by the Tenant of the insurance policies as required pursuant to this Article shall not limit or restrict the liability of the Tenant under this lease. Without limiting any exclusion of liability, release or indemnity or other provision herein, the Tenant hereby releases the Landlord and its agents, officers, employees, contractors, workers and those for whom each is in law responsible from any and all liability for losses, damages and claims of any kind to the extent of all insurance proceeds paid under (i) the policies of insurance maintained by the Tenant as required under this lease or which would have been paid if the Tenant had maintained the insurance it is required to maintain under this lease and had diligently processed any claims thereunder and (il) any policies of insurance and insurance coverage otherwise maintained by the Tenant. H:\LEASES\2002-THEATRE DANCE.DOC LEASE AGREEMENT Page 15 6.5 Tenant's Effect on Other Insurance (a) The Tenant shall promptly comply with all reasonable requirements of any insurer now or hereafter in effect relating to or affecting the Premises or the Building, or any part thereof. The Tenant shall not do and shall not cause, suffer or permit to be done or omitted to be done by any of its employees, agents, contractors or Persons for whom the Tenant is in law responsible anywhere in the Premises or the Building or by any Person in, on or about the Premises and shall not permit there to be on the Premises anything which, whether or not the Landlord has consented thereto, might (i) result in any increase in the cost of any insurance policies of the Landlord on or related to the Building or the Lands or any part or contents thereof, (ii) result in an actual or threatened cancellation of, reduction in coverage under, or adverse change in any policy of insurance of the Landlord or others on or related to the Building or the Lands or any part or contents thereof or (iii) be prohibited by any policy of insurance of the Landlord or any others in force from time to time in respect of the Building or the Lands or any part or contents thereof. (b) If the cost of any insurance policies of the Landlord related to the Building or the Lands or any part or contents thereof shall be increased as a result of (i) the use or occupancy of the Premises by the Tenant or any other Person on the Premises, or (ii) anything kept or permitted to be kept by the Tenant or by any Person anywhere on the Premises or by the Tenant or any of its employees, customers, contractors, suppliers or Persons for whom the Tenant is in law responsible (any of which are in this Section 6.5 referred to as "Employees") on any part of the Premises, the Building or the Lands, or (iii) any act or omission of the Tenant or any Person on the Premises, or of the Tenant or any of its Employees in any part of the Building or the Lands, the Tenant shall pay the full amount of such increase in cost to the Landlord forthwith upon demand as Additional Rent. In determining the Tenant's responsibility for any increased cost of insurance as aforesaid, a statement issued by the organization, company or insurer establishing the insurance premiums or rates for the relevant policy shall be conclusive evidence of the various components of such premiums or rates and the factors giving rise to any increase therein. (c) In the event of an actual or threatened cancellation of or adverse change in any policy of insurance of the Landlord or any others on or related to the Building or the Lands or any part or contents thereof by reason of (i) the use or occupancy of the Premises by the Tenant or any other Person permitted by the Tenant on the Premises, (ii) anything placed on or permitted by the Tenant or any Person on the Premises or by the Tenant or any of its employees or invitees on any part of the Building or the Lands or (iii) any act or omission of the Tenant or any Person in the Premises or by the Tenant or any of its employees, invitees or customers on any part of the Building or the Lands and if the Tenant fails to remedy the situation, condition, use, occupancy or other factor giving rise to such actual or threatened cancellation or change within three (3) days after notice thereof by the Landlord, the Landlord, in addition to any other right or remedy it may have, at its option may either (i) terminate this lease forthwith by written notice or (ii) remedy the situation, condition, use, occupancy or other factor giving rise to such actual or threatened cancellation or change, all at the cost of the Tenant to be paid to the Landlord forthwith upon demand as Additional Rent For any or all of such purposes as set forth in this Section the Landlord shall have the right to enter upon the Premises without further notice. H\LEASES\2002-THEATRE DANCE-DOC LEASE AGREEMENT Page 16 6.6 Indemnitv of Landlord Notwithstanding any other provision of this lease, the Tenant shall indemnify the Landlord and all of its agents, managers, officers, employees, contractors, consultants, workers and Persons for whom the Landlord is in law responsible (collectively in this Section 6.6 and in Section 6.7 called "Landlord's Employees") and shall hold them and each of them harmless from and against any and all liabilities, actions, proceeding, damages, claims, losses (including, without limitation, indirect or consequential damages that may be suffered or sustained by the Landlord or any of the Landlord's Employees and loss of Rent and other amounts payable by the Tenant under this lease) and expenses (including, without limitation, all legal fees and disbursements) whatsoever, howsoever arising from or out of this lease, and/or, without limiting the generality of the foregoing, howsoever caused by, due to, arising from or to the extent contributed to by any of the following: (i) any breach or default by the Tenant of or under any of the provisions of this lease; (ii) any lien under the Construction Lien Act, R.S.O. 1990, c.30 respecting the Premises; (iii) any breach by the Tenant of the terms of any encumbrance affecting the Premises; (iv) any act or omission of the Tenant or any other Person on or permitted on the Premises, or any use or occupancy of, or any articles in, the Premises or any part thereof, or any use or occupancy of any other part of the Building or the Lands by the Tenant or any of its agents, employees, invitees, licensees, sub- tenants, assignees,concessionaires, contractors or Persons for whom the Tenant is in law responsible (collectively in this Section 6.6 and in Section 6.7 called "Tenant's Employees"); (v) any act or omission of the Tenant or any of the Tenant's Employees on the Premises or elsewhere in, on or about the Building or the Lands or any part thereof; (vi) any injury, personal discomfort, illness, death or loss, costs, expenses or damages whatsoever, direct or indirect or consequential, however caused or arising (I) to Persons or property of the Tenant or any of the Tenant's Employees or any other Persons in, on or about the Building or the Lands or any part thereof by or with the invitation, licence or consent of the Tenant and/or (II) which is excluded from the Landlord's liability or responsibility under Section 6.7(b); (vii) any accident or occurrence in, on or at the Premises including, without limitation, any such accident or occurrence causing injury or death to any Person or damage to property or any other loss or injury whatsoever; and/or (viii) any damage, destruction or need of repair or replacement to any part of, or otherwise relating to, the Premises or any other part of the Building, or any damages incurred by the Landlord or by any occupant of the Building or any part thereof, caused by any act or omission of the Tenant or any of the Tenant's Employees, notwithstanding any other provisions of this lease including, without limitation, the provisions regarding the Landlord's repair obligations and Article VII; and, for greater certainty, whether or not any of the foregoing is caused, arising or contributed to by the negligence or fault of the Landlord or any of the Landlord's Employees. If the Landlord, without fault on its part, is made a party to litigation commenced by or against the Tenant, the Tenant shall indemnify and hold harmless the Landlord from and against all legal and other costs. The Landlord, at its option, may participate in, or assume carriage of, any litigation or settlement discussions relating to the foregoing, or any other matter for which the Tenant is required to indemnify the Landlord under this lease. Alternatively, the Landlord may require the Tenant to assume carriage of and responsibility for all or any part of such litigation or H\LEASES\2002-THEA TRE DANCE-DOC LEASE AGREEMENT Page 17 discussions. The Tenant shall pay all legal costs incurred or paid by the Landlord in enforcing the provisions of this lease. For greater certainty the Tenant's obligations contained in this Section shall survive the expiration or earlier termination of the Term. 6.7 Loss or Damaae The provisions of this Section 6.7 shall govern notwithstanding any other provision of this lease. (a) The Landlord shall not be liable for any death or injury arising from or out of any occurrence whatsoever in, upon, at or relating to the Premises, the Building on the Lands, or any part thereof, or damage to property of the T enarit or of others located on the Premises, the Building or the Lands from any cause whatsoever, nor shall the Landlord be responsible for any loss of or damage to any property of the Tenant or others from any cause whatsoever, whether or not such property is entrusted to the care or control of the Landlord or any of the Landlord's Employees, nor shall the Landlord be responsible for any indirect or consequential damages that may be suffered or sustained by the Tenant or any others from any cause whatsoever, and in each case whether or not any such death, injury, loss, damage or damages results from the negligence or fault of the Tenant, the Landlord or any of the Landlord's Employees. (b) Without limiting the generality of the foregoing, the Landlord shall not be liable or responsible in any way for any death, injury (including, without limitation, personal discomfort or illness) loss, damage or damages of or to Persons or property resulting, directly or indirectly, from any of the following, whether or not such results from the negligence or fault of the Landlord or any of the Landlord's Employees: (i) fire, explosion, theft, breakage, falling plaster, falling ceiling tile, falling fixtures, steam, gas, electricity, water, rain, flood, ice, snow or leaks into, in or from any part of the Premises or Building or from any pipes (including, without limitation, water, steam, sprinkler and drainage pipes), sprinklers, appliances, drainage or plumbing works, roof, windows or exterior walls or subsurface of any floor or ceiling of the Premises or Building, or any part thereof, or from the street or any other source or place whatsoever, or by dampness, or by the existence, discharge, spillage or leakage of hazardous or toxic substances, or by any other cause whatsoever; (ii) any suspension, non-operation, failure, reduction, interruption or failure to supply or perform, for any reason or for any period of time, of or in any of the services, equipment, facilities, systems (such as, without limitation, the HVAC System) or Utilities or any public Utilities or any services serving the Premises, or the Building, or any part thereof; (iii) delays in the performance of any repairs, replacements, maintenance or Restoration for which the Landlord is responsible under this lease; (iv) incurred by reason of the Landlord or any of the Landlord's Employees entering upon the Premises to undertake any examination thereof or any work or cleaning or performance of other services therein; (v) incurred by reason of the supply or performance of any dealing, janitorial, pest extermination or security obligations or services in any part of the Premises or the Building; or (vi) by reason of inconvenience, annoyance or injury to business arising from the Landlord, the Tenant or any others making or failing to diligently make, for whatever reason or cause, any repairs, alterations, additions, renovations, improvements or Restorations in or to any part of the Premises, the Building, or the Lands. (c) The Landlord shall not be liable or responsible in any way for any such death, injury, loss or damage caused by other tenants, occupants or Persons on or in the Premises, the Building or the Lands, or any part thereof or by any occupants of any adjacent property thereto. (d) All property of the Tenant or of any of the Tenant's Employees kept or stored on the Premises (including without limitation, all Leasehold Improvements leased by the Tenant herein) shall be so kept or stored at the sole risk of the Tenant, and the Tenant releases and agrees to indemnify the Landlord and save it harmless from and against any claims arising out of any loss of or damage to such property, including, without limitation, any subrogation claims by the Tenant's or any others' insurers, and the Tenant shall make all claims for loss, damage or destruction of or to any such property against the policies of insurance required to be maintained by the Tenant under this lease. H:\LEASES\2002-THEA TRE DANCE. DOC LEASE AGREEMENT Page 18 6.8 Benefit of Releases Every indemnity, hold harmless provision, release and exclusion of liability herein contained for the benefit of the Landlord and every waiver of subrogation for the benefit of the Landlord contained in any insurance policy maintained by the Tenant shall survive the expiration or earlier termination of the Term and shall extend to and benefit all of the Landlord, its officers, employees and those for whom any of the Landlord, such manager(s) and such agents, respectively, is in law responsible. Solely for such purpose, and to the extent that the Landlord expressly chooses to enforce the benefits of this Section for any or all of such Persons, it is agreed that the Landlord is the agent or trustee for such Persons. No such indemnity, hold harmless provision, release or exclusion of liability or waiver of subrogation for the benefit of the Landlord shall be deemed to impose or imply any obligation, responsibility or liability whatsoever on the Landlord, including, without limitation, any obligation to perform or do any act or thing, except to the extent any such obligation, responsibility or liability of the Landlord is expressly provided for under this lease. H:\LEASES\2002-THEATRE DANCE. DOC LEASE AGREEMENT Page 19 ARTICLE VII DAMAGE AND DESTRUCTION 7.1 Damaae to Premises. Building or Development If the Premises or Building, or any part thereof, are damaged or destroyed, in whole or in part, by fire or any other occurrence, then (i) this lease shall nonetheless continue in full force and effect, (ii) there shall be no abatement of any Rent except to the extent expressly provided in this Article, (iii) the following provisions of this Article shall apply and (iv) notwithstanding any receipt by the Landlord of any insurance proceeds, and notwithstanding any provision of this lease or obligation or requirement at law, in equity or by statute to the contrary, the obligations of the Landlord to maintain, repair and replace or to provide services or Utilities, if any, or to perform Restoration under this lease shall be subject to the provisions of this Article and limited to the extent to which the Landlord is required to be insured under this lease or is otherwise insured. 7.2 Insured Damaae to Premises If there is damage or destruction to the Premises caused by an occurrence against which, and to not more than the extent that, the Landlord either is required to insure pursuant to this lease or is otherwise insured (in this Article VII called "Insured Damage"), and if (i) in the Architect's opinion, such Insured Damage is such as to render the whole or any part of the Premises unusable or unsafe for the purpose of the Tenant's use and occupancy and the Restoration of the Premises is not capable of being completed with reasonable diligence within 180 days following such occurrence or (ii) any Authority, requires that the Building or the Residential Building be demolished or substantially demolished prior to any Restoration, then the Landlord may elect to terminate this lease by giving written notice to the Tenant within sixty (60) days after such occurrence. If the Landlord does not so elect to terminate this lease, the parties shall diligently perform the Restoration of the Premises pursuant to Section 7.6. 7.3 Uninsured Damaae to Premises and Last Two Years If there is damage or destruction to the Premises and, in the Architect's opinion, (i) such damage or destruction is caused by an occurrence against which the Landlord is not insured or required to insure or the cost of Restoration of which would be in excess of the extent to which the Landlord is required to insure pursuant hereto or is otherwise insured or (ii) the Restoration of the Premises is not capable of being completed within sixty (60) days following the occurrence of such damage or destruction and such damage or destruction occurs within two (2) years prior to the expiry of the stated Term or any extension or renewal thereof and either there are no remaining rights in any party hereto to extend or renew this lease or any party having the right to extend or renew this lease fails to do so within fifteen (15) days after such occurrence, then, in either event, the Landlord may elect to terminate this lease by giving written notice to the Tenant within thirty (30) days after such occurrence. If the Landlord does not so elect to terminate this lease, the parties shall diligently perform the Restoration of the Premises pursuant to Section 7.6. H:\LEASES\2002- lHEATf<E DANCE.DOC I LEASE AGREEMENT Page 20 7.4 Damage to Buildina or DeveloDment If (i) in the Architect's opinion, Restoration of portions of the Building which affect access or services essential to the Building or Premises is not capable of being completed with reasonable diligence within one hundred and eighty (180) days following the occurrence of damage or destruction to such portions or (ii) any Authority requires that the Building be demolished or substantially demolished prior to any Restoration following damage or destruction to the Building or any part thereof, in any such case whether such damage or destruction is a direct or indirect result of any occurrence of cause whatsoever, whether or not such occurrence or cause is insured, and whether or not there is any damage or destruction to the Premises, then the Landlord may elect to terminate this lease by giving written notice to the Tenant within sixty (60) days after such cause or occurrence. If the Landlord does not so elect to terminate this lease, the parties shall diligently perform the Restoration of the Premises and Building to the extent of their obligations pursuant to Section 7.6 (subject to Sections 7.2 and 7.3). 7.5 Termination If the Landlord elects to terminate this lease under this Article by giving written notice to the Tenant, then, notwithstanding the receipt by the Landlord of any insurance proceeds, (i) this lease shall terminate on the date that such notice is given, (ii) the Tenant shall immediately vacate and surrender possession of the Premises and (iii) all Rent accrued to such termination date shall be apportioned and promptly paid without any right of the Tenant to any abatement, deduction, counterclaim, set-off, compensation or reduction whatsoever. 7.6 Restoration if Lease Not Terminated If this lease is not terminated as provided in this Article, the Landlord, to the extent of insurance proceeds which the Landlord receives or would have received if it had maintained such insurance as is required to be maintained by the Landlord hereunder, shall proceed to perform such Restoration to the Premises and Building limited to the extent of its express obligations under this lease (which exclude, without limitation, the Restoration of all Leasehold Improvements) and to the extent of which it is not the Tenant's obligation to perform Restoration under any Article of this lease, and subject to the provisions of this Article and the Tenant's obligations under this lease. The Tenant, commencing on the seventh (7th) day following the Landlord's written notice to the Tenant of the date of the Landlord's substantial completion of its Restoration to the Premises, without interfering with the Landlord's Restoration, shall re-occupy the Premises and during the thirty (30) day period commencing on such date (in this Section called the "Tenant's Restoration Period") shall proceed to perform such Restoration as is the Tenant's responsibility under this lease, including, without limitation, the Restoration of all Leasehold Improvements. The respective obligations of the Landlord and the Tenant with respect to Restoration of the Premises following any damage or destruction under this Article shall be performed in accordance with all applicable obligations to perform Restoration contained herein (including, without limitation, Section 5.3) with due diligence and dispatch. The Tenant's obligations to perform Restoration to the Premises after such damage or destruction shall be performed at the Tenant's sole cost and without any contribution thereto by the Landlord (save and except to the extent as may otherwise be specifically provided in this lease) whether or not (i) the Landlord had at any time made any contribution to the cost of supply, installation or construction of any Leasehold Improvements in the Premises (including, without limitation, any inducement, allowance or loan), (ii) the Landlord had constructed or provided all or part of such Leasehold Improvements at the Landlord's sole cost, (iii) the Landlord, the Tenant or both maintain insurance with respect to such Leasehold Improvements or (iv) the damage or destruction was caused by the Landlord's fault or negligence. In any event, within the Tenant's Restoration Period, the Tenant shall complete its Restoration to the Premises and shall fully fixture and staff the Premises and recommence the operation of the Tenant's use of the Premises as permitted and required pursuant to this lease. If the damage or destruction is such as to render the whole or any part of the Premises unusable in whole or in part for the purpose of the Tenant's use and occupancy as permitted under H:\LEASESi2002- THEATHE DANCE.DOC LEASE AGREEMENT Page 21 this lease, then Net Rent payable hereunder shall abate to the extent that the Tenant's use and occupancy of the Premises is in fact thereby diminished, as determined by the Architect in its sole discretion, from the date of such damage or destruction until the earlier of (i) the expiry of the Tenant's Restoration Period and (ii) the date on which the Tenant first commences the use and occupancy as required by this lease of any part of the Premises which had been so damaged or destroyed, and then only to the extent that the damage or destruction to the Premises is Insured Damage. 7.7 Restoration of Premises or Buildina and Insurance Proceeds If there is damage or destruction to the Premises or the Building, or any part thereof, and if this lease is not terminated pursuant hereto, the Landlord, in performing the Restoration of the Premises or Building, or any part thereof, as required hereby, shall not be obliged to perform such Restoration in accordance with the plans, drawings or speCifications for the Premises or the Building, or any part thereof, as they existed prior to such damage or destruction but the Landlord may perform such Restoration in accordance with any plans, drawings and specifications chosen by the Landlord in its sole discretion. Without limiting the generality of the foregoing, the Landlord shall be entitled to demolish and rebuild the Premises or Building, or any part thereof. The proceeds of insurance, which is required to be maintained by the Tenant and which insurance is required to name the Landlord and any others as insureds with loss payable to the Landlord and with insurance proceeds assigned to the Landlord, shall be and are hereby assigned and made payable to the Landlord. If the Tenant receives any such insurance proceeds, the Tenant shall receive and hold such proceeds in trust for the Landlord and shall promptly deliver them to the Landlord. To the extent that such proceeds shall have been paid to the Landlord, they shall be released to the Tenant (provided the Tenant is not then in default hereunder) as follows: (i) if this lease is not terminated pursuant hereto, (I) following the Tenant's written request, (II) in accordance with all applicable laws, (III) in progress payments, but on a "cost to complete" basis, at stages determined by the Architect, (IV) following receipt by the Landlord of a certificate from the Architect, in substance and form satisfactory to the Landlord, inter alia, that Restoration to each stage has been satisfactorily completed by the Tenant, (V) provided that, to the Landlord's satisfaction, such Restoration is completed free of liens and without notice or registration of liens, provided that, if the Tenant defaults in making such Restoration or any part thereof and if the Landlord shall perform such Restoration or part thereof, the proceeds may be applied by the Landlord to the costs thereof; or (ii) if this lease is terminated pursuant hereto, but only to the extent of the value of any Tenant's fixtures or personal property of the Tenant (to the extent that the Tenant is not indebted to the Landlord or in default under the provisions of this lease) but not to the extent of the value of any Leasehold Improvements made by, on behalf of or for the benefit of the Tenant to the Premises. 7.8 Determination of Matters For the purposes of this Article, the date of any damage or destruction, the determination of and extent to which any area(s) of the Premises of the Building are damaged, destroyed, rendered unsafe or are not capable of being used, the times within which Restoration may be made and the date that it is completed or substantially completed shall be determined by the Architect in its sole discretion, such determination to be final and binding On the parties. 7.9 Limitation of Liabilitv Notwithstanding any other provision of this lease, the Landlord shall not be liable for any damages, direct, indirect or consequential, of any nature whatsoever, (including, without limitation, loss of business income or other economic loss to the Tenant), of the Tenant or its clerks, employees, customers, suppliers or other Persons dealing directly or indirectly with the Tenant or for whom the Tenant is in law responsible arising out of the failure for any cause whatsoever of the Landlord or others to perform or complete Restoration of the Premises or Building, or any part thereof, within any period of time following the occurrence of damage or destruction contemplated by this Article, and the Tenant shall indemnify and save harmless the Landlord from and against all such damages. . H:\LEASE:S\2002-THEATF'iE DANCE-DOC LEASE AGREEMENT Page 22 ARTICLE VIII TRANSFERS 8.1 Transfers The Tenant shall not enter into, consent to or permit any Transfer without the prior written consent of the Landlord in each instance, which consent shall not be unreasonably withheld but shall be subject to the Landlord's rights under Section 8.2. Notwithstanding any statutory provision to the contrary, it shall not be considered unreasonable for the Landlord to withhold its consent in the Landlord's sole discretion, for any reason or for no reason. Any consent by the Landlord to any Transfer shall not constitute a waiver of the necessity for such consent to any subsequent Transfer. This prohibition against any Transfer shall include a prohibition against any Transfer by operation of law. No Transfer shall take place by reason of the failure of the Landlord to give notice to the Tenant within the 30 days required by Section 8.2. 8.2 Landlord's Riaht to Terminate (a) If the Tenant intends to effect a Transfer, the Tenant shall give prior written notice to the Landlord of such intent specifying the identity of the Transferee, the type of Transfer contemplated, the portion of the Premises affected thereby and the financial and other terms of the Transfer, and shall provide such financial, business or other information relating to the proposed Transferee and its principals as the Landlord requires, together with copies of any documents which record the particulars of the proposed Transfer. (b) The Landlord, within thirty (30) days after having received such notice and all requested information and copies of documents, shall give written notice to the Tenant either that (i) it consents or does not consent to the Transfer in accordance with the provisions and qualifications of this Article VIII or (ii) it elects to cancel this lease as to the whole or part, as the case may be, of the Premises affected by the proposed Transfer, in preference to giving such consent. (c) If the Landlord elects to terminate this lease, (i) it shall stipulate in its notice the termination date of this lease, which date shall be no earlier than thirty (30) days and no later than ninety (90) days following the giving of such notice of termination and(ii) the Tenant, within ten (10) days after the Landlord's notice of termination is given, shall give written notice to the Landlord either to refrain from such Transfer or to accept termination of this lease. (d) If the Tenant either fails to give such notice within such ten (10) days or gives such notice within such ten (10) days agreeing to accept the Landlord's termination, this lease, as to the whole or affected part of the Premises, as the case may be, shall terminate on the date of the termination stipulated by the Landlord in its notice of termination. If the Tenant gives such notice to the Landlord within such ten (10) days agreeing to refrain from such Transfer, then the Landlord's election to terminate this lease shall become void. 8.3 Conditions of Transfer (a) If there is a Transfer, the Landlord may collect rent from the Transferee and apply the amount collected to the Rent payable under this lease, but no acceptance by the Landlord of any payments by a Transferee shall be deemed to be a waiver of the Tenant's covenants or the provisions of Article VIII nor any acceptance of the Transferee as tenant nor a release of the Tenant from its liabilities or the further performance by the Tenant of its obligations under this lease. Any consent by the Landlord shall be subject to the Tenant and Transferee executing and delivering an agreement with the Landlord, in substance and form satisfactory to the Landlord, agreeing, inter alia: (i) that the Transferee will be bound by all of the terms, covenants and conditions of this lease, inducing, without limitation, the terms, covenants and conditions contained in Section 1.4, as if such Transferee had originally executed this lease as tenant. H\LEASES\2002- THEATRE DANCE.DOC LEASE AGREEMENT Page 23 (b) Notwithstanding any Transfers (whether or not permitted or consented to by the Landlord or otherwise), subsequent amendments to this lease or Alterations, the Tenant shall be jointly and severally liable with the Transferee under this lease and the Tenant shall remain bound by this lease and shall not be released from performing and observing all of the terms, covenants and conditions of this lease, in each case throughout the Term and any and all renewals or extensions thereof provided for herein. (c) Any and all Transfers (whether or not permitted or consented to by the Landlord or otherwise) and the Landlord's consent to any Transfer shall be subject to but not limited to the condition that the rent and additional rent payable by the Transferee shall not be less than the Net Rent and Additional Rent, respectively, payable by the Tenant under this lease as at the effective date of the Transfer. (d) Notwithstanding the effective date of any Transfer, all Net Rent and Additional Rent for the month in which such effective date occurs shall be paid in advance by the Tenant so that the Landlord will not be required to accept partial payments of Net Rent and Additional Rent for such month from either the Tenant or Transferee. (e) Any document evidencing or consenting to any Transfer permitted or consented to by the Landlord, or setting out any terms or conditions applicable to such Transfer or the rights and obligations of the Tenant or Transferee thereunder, shall be subject to the Landlord's prior written approval and, at the option of the Landlord, shall be prepared by the Landlord or its solicitors. All associated legal costs shall be paid by the Tenant to the Landlord, as Additional Rent, on demand and as a condition to the Landlord's consent to any Transfer. 8.4 Chanae of Control If the Tenant is at any time a corporation or partnership, any actual or proposed Change of Control in such corporation or partnership shall be deemed to be a Transfer or proposed Transfer, respectively, and subject to all of the provisions of this Article VIII. The Tenant shall make available to the Landlord or its representatives all of its corporate or partnership records, as the case may be, for inspection at all reasonable times, in order to ascertain whether any Change of Control has occurred. 8.5 No Advertisina The Tenant shall not advertise that the whole or any part of the Premises are available for a Transfer and shall not permit any broker or other Person to do so unless the text and format of such advertisement is prior approved in writing by the Landlord. 8.6 Assianment bv Landlord The Landlord shall have the unrestricted right to lease all or any parts of the Building and this lease or any interest of the Landlord in this lease. To the extent that the lessee from the Landlord assume the obligations of the Landlord under this lease, the Landlord shall thereupon and without further agreement be released of all obligations and liabilities under this Lease. H:\LEASES\2002-THEATRE DANCE DOC LEASE AGREEMENT Page 27 ARTICLE X SPECIAL PROVISIONS 10.1 ParkinQ The Tenant acknowledges that parking available on the Lands shall be available to the Tenants, its agents, employees, invitees and customers and to the Landlord, its agents, officers, employees, invitees and members of the public who use any part of the Building, on a first come, first serve basis. If either the Landlord or the Tenant considers that too few parking spaces are available on the Lands, the Landlord and the Tenant will cooperate in achieving an agreement between them to provide for an increase in the number of parking spaces. The Tenant acknowledges that in the case of the Landlord such an agreement would be made in the context of the annual budget process of the Landlord. 10.2 Extension or Renewal As a matter of courtesy but not of legal obligation and without derogating in any way from the other provisions of this lease, at least nine (9) months prior to the expiry of the Term or any renewal or extension thereof the Landlord will attempt to determine if it will require vacant possession of the Premises on the expiry of the Term or the renewal or extension thereof and to give the Tenant written notice of the Landlord's determination if the Landlord determines that it will not require vacant possession of the Premises at such time. At such time the Landlord and the Tenant will act in good faith to attempt to settle the terms and conditions of a renewal or extension of the lease failing which the Tenant acknowledges that the Landlord is free to take vacant possession of the Premises or to lease them to a person other than the Tenant for a term commencing after the expiry of this lease or the extension or renewal of it on terms and conditions that the Landlord in its sole discretion considers to be expedient and without any liability to the Tenant. 10.3 Operation of Dance School Without derogating from the other provisions of this lease, the Tenant shall comply with all applicable laws, the terms and conditions of licence or permit issued to the Tenant by any Authority. The Tenant shall ensure that the Premises are managed and operated in a safe manner at all times so as to protect the health, safety and well-being of its staff, customers and visitors. The Tenant shall display warning signs as may be directed by the Landlord in its sole discretion to ensure public safety. Forthwith after each incident occurs involving the fatality of or life-threatening injury to any person using or occupying the Premises or any part thereof, the Tenant shall notify the Authorized Officer of the same and the circumstances and cause of the incident. If the Authorized Officer considers it appropriate to do so the Landlord may enter on the Premises and examine the records of the Tenants in order to conduct the Landlord's own investigation of the circumstances and cause of the incident. 10.4 Phvsical Plant and EQuipment The Tenant throughout the Term shall maintain a properly documented system of quality control designed to ensure the Premises are properly maintained. Monitoring shall be undertaken by the Tenant in accordance with all manufacturers or legal requirements. The Tenant shall not carry out any structural alterations to the Premises without the approval of the Authorized Officer. The Tenant will not permit the disconnection of any electricity, gas or water supply to any part of the Premises without permission of the Authorized Officer. The Landlord will conduct and pay for the annual fire inspection of the fire alarm system and make appropriate repairs in the Inspection Report. The Tenant is responsible to ensure that the system is operational at all times and to immediately advise the Authorized Officer of any deficiencies. The cost of inspections will be borne by the Landlord. The Tenant is responsible to pay for and furnish the designated area with sufficient fire extinguishers. H:\LEASES\2002-THEATRE DANCE.DOC LEASE AGREEMENT Page 28 10.5 Manaaement and ODeration of Premises The Tenant throughout the Term shall undertake (i) the management and operation of the Premises; (ii) the supervision of the activities which take on the Premises; ensuring the well-being and safety of anyone entering onto the Premises (Le. staff, public); (iii) the cleaning and property maintenance of internal and external areas of the Premises; (iv) the provision of equipment for the purposes of cleaning the Premises; (v) the provision of security in and about the Premises; (vi) if a monitoring security system is in place on the Premises, the payment of the costs of normal upkeep and maintenance; (vii) providing the Authorized Officer and the Fire Department of the Landlord with keyed access to the Premises; (viii) providing the Authorized Officer with a list of names and telephone numbers of those having keyed access, updated as needed; (ix) the payment and supply all day-to-day costs of the Premises including, but not limited to, cleaning supplies and operating supplies; and (x) the payment and obtaining of appropriate current licenses, approvals and certificates as required to use and operate the premises in accordance with this lease. 10.6 DisDosalofWaste The Landlord shall make arrangements and pay for the cost of the disposal of all effluent, waste and refuse from all parts of Premises from the Commencement Date until the day after the day of termination of the lease. The Tenant shall ensure that all waste and refuse is stored, awaiting collection, in industry standard containers used for normal disposal of domestic and commercial waste and refuse and in all cases, is to be disposed of appropriately. The Tenant shall ensure that the volume of any effluent, waste or refuse at the leased space does not exceed the capacity of the storage containers provided. The Tenant shall not dispose by burning any waste or refuse at the Facility by burning the same. 10.7 Quality Control The Authorized Officer shall oversee contract compliance on behalf of the Landlord and will have the right at any time to inspect the Premises and to meet with the Tenant to discuss the compliance with this lease. In the event of a breakdown of communication, the Tenant may appear as a delegate to Council of the Landlord. The Tenant shall: (a) provide services to a standard which is to the reasonable satisfaction of the Landlord and to comply in all respects to this lease; (b) deal with any complaints and suggestions received in a prompt, courteous and efficient manner; (c) maintain an accurate record of complaints that will be available for discussion by the Authorized Officer. The Tenant shall throughout the Term maintain a properly documented system of quality control designed to ensure that the Premises are clean and properly maintained. The Tenant may be invited to meet with the Authorized Officer, and any other appropriate parties on a regular basis to discuss any shared issues relating to the Premises and shall attend such meetings. The Authorized Officer may mediate any differences which may arise and to ensure open communication among all the components of the Premises. H:\LEASES\2002-THEATRE DANCE-DOC LEASE AGREEMENT Page 29 10.8 Soonsorshio and Advertisina Sales The Tenant is encouraged to seek sponsorship and advertising sales for its activities subject to formal permission in writing being received from the Landlord in advance of completion of negotiations with potential sponsors. The Tenant will only enter into sponsorship or advertising sales agreements with companies agreed to by the Landlord, not to be unreasonably withheld. The Tenant shall not enter any agreement with sponsors or advertising sales agreements which extend beyond the Term except with the prior approval of the Landlord. The Landlord and the Tenant may enter into joint agreements with sponsors or for advertising sales, where it is mutually beneficial to do so. These agreements will be negotiated at the time and will not form part of this lease. At the commencement of the contract, the Authorized Officer will provide the Tenant with a list of applicable sponsorship and advertising agreements currently in force with the Landlord. In order to avoid competition or duplication, the Tenant shall not contact the latter organizations or companies directly, but only through the Landlord. 10.9 Marketina and Advertisina All marketing and advertising of the Premises and associated events will be the responsibility of the Tenant and will be carried out at its expense. The Tenant shall comply with regulations and standards set by the Canadian Advertising Council and display advertising that is of an acceptable, high moral standard, non-political and in good taste. The Authorized Officer retains the right to prohibit at any time material which the Authorized Officer deems may offend the public or embarrass the Landlord, or detract from the aesthetics of the building. The Landlord may provide the Tenant with information which may be posted in the leased space. Approval must be given by the Authorized Officer for any external signage required by the Tenant, such approval shall not be unreasonably withheld. 10.10 Concessions/Caterina The Landlord reserves the rights to install and operate all concession/snack/bar sales/vending machines sales within the Complex. Special event catering may be permitted with the prior written consent of the Authorized Officer who shall have the power to approve or refuse to approve any catering or food suppliers, in his sole discretion. H :\LEASES\2002- THEATRE DANCE .DOC LEASE AGREEMENT Page 30 ARTICLE XI GENERAL PROVISIONS 11.1 Rules and Reaulations The Tenant shall comply with, and shall cause its agents, employees, invitees, licensees, contractors, sub-tenants and assignees to comply with, all Rules and Regulations, and amendments thereto, established by the Landlord from time to time including, without limitation, those set out in Schedule "D" attached hereto. The Landlord shall have no obligation to enforce any of the Rules and Regulations or the provisions of any other release or agreement against any other tenant or occupant of the Building, and the Landlord shall have no liability to the Tenant howsoever caused with respect thereto. 11.2 Delav Except as may be otherwise expressly provided in this lease, whenever and to the extent that the Landlord or Tenant is delayed or restricted in or prevented from the fulfilment of any obligation under this lease (other than the obligation to pay any sum of money and to surrender the Premises on the expiry or earlier termination of the Term) by reason of strikes, lock-outs, acts of God, restrictive laws or regulations of any Authority, unavailability of materials or services or other occurrences or matters which are not its fault or not within its reasonable control, then the performance of such obligation shall be excused during the period in which such circumstances operate to delay or restrict or prevent the fulfilment of such obligation and the party so delayed shall be entitled to perform and fulfil such obligation within an equivalent time period thereafter. 11.3 Overholdina If the Tenant remains in possession of the Premises after the end of the Term with the consent of the Landlord but without the parties having executed and delivered a new lease or an agreement extending or renewing the Term, there shall be no tacit renewal of this lease or extension or renewal of the Term, and the Tenant shall be deemed to be occupying the Premises as a tenant from month to month on the same terms and conditions as are set forth in this lease (including, without lin'litation, those regarding the payment of Rent), so far as they are applicable to a monthly tenancy, except that Net Rent shall be monthly, payable in advance on the first day of each month, in an amount equal to twice the monthly amount of Net Rent payable during the last full month of the Term or any extension or renewal term, as the case may be. 11.4 Notices Any notice, demand, request, consent or other instrument ("Notice") which may be or is required to be given under this lease shall be in writing and shall be delivered in person or sent by registered mail postage prepaid addressed (i) if to the Landlord, Municipality of Clarington, 40 Temperance Street, Bowmanville, Ontario, L 1C 3A6, Attention: Lou Ann Birkett and (ii) if to the Tenant, at the Premises, Attention: Jan Brown, at the Landlord's option. Any such Notice shall be deemed to have been given and received on the day upon which personal delivery is made or, if so mailed, then 48 hours following the date of mailing. Either party may give Notice to the other of any change of address (other than the Premises) whereupon the address therein specified shall be deemed to be the address of such party for Notice. If postal service is interrupted or substantially delayed, all Notices shall be delivered in person as provided above. 11.5 Successors The rights, obligations and liabilities created by this' lease shall enure to the benefit of and shall bind the successors and assigns of the Landlord and the heirs, executors, administrators and permitted successors and assigns of the Tenant. No rights, however, shall enure to the benefit of any Transferee unless the provisions of Article VIII are complied with. H:\LEASES\2002-THEATRE DANCE.DOC LEASE AGREEMENT Page 31 11.6 Covenants and Joint and Several Liabilitv Every obligation of the Landlord or the Tenant expressed in this lease, even though not expressed as a covenant, shall be deemed to be a covenant for all purposes. The word "Tenant" shall be deemed to mean each and every Person or party mentioned as Tenant herein. If, at any time, there is more than one Tenant or more than one Person constituting the Tenant, their covenants shall be considered to be joint and several and shall apply to each and every one of them, and each of them acknowledges that it shall have no right to any benefit of division or discussion. If the Tenant is or becomes a partnership, each Person who is or shall become a member of such partnership or its successors shall be and continue to be jointly and severally liable for the performance of all covenants of the Tenant pursuant to this lease, notwithstanding the dissolution of such partnership or its successors and whether or not such Person ceases to be a member of such partnership or its successors. 11.7 Headina. Table of Contents. Lease Summary The Article and Section headings, table of contents and lease summary, if any, appearing in this lease are inserted only as a matter of convenience, are of no force or effect and in no way affect the substance or interpretation of this lease or constitute a representation of any kind. 11.8 Extended Meanlnas The words "herein", "hereof', "hereunder" and similar expressions used in this lease relate to the whole of this lease and not only to the provisions in which such expressions appear. This lease shall be read with all changes in number and gender as may be appropriate or required by the context. Any reference to the Tenant includes, in relation to a provision to be performed or observed by the Tenant and where the context allows, the employees, agents, invitees, visitors, customers, contractors and licensees of the Tenant and all others over whom the Tenant might reasonably be expected to exercise control and the Tenant shall cause such Persons to perform and observe such provisions including, without limitation, the Rules and Regulations. 11.9 Partiallnvaliditv If all or any part of any provision is held to be or rendered illegal or unenforceable it shall be considered separate and severable from this lease and the remaining parts of this lease shall remain in force and effect and shall bind the parties as though the illegal or unenforceable provision or part thereof had never been included in this lease. 11.10 Entire Aareement This lease and the Schedules attached hereto set forth the entire agreement between the Landlord and Tenant concerning the Premises, Building and the Lands and there are no covenants, representations, agreements, warranties, conditions or understandings in any way relating to the Premises, the Building or the Lands, or any part thereof, or the subject matter of this lease or the Offer to Lease, whether expressed or implied, collateral or otherwise, either oral or written, whether by the Landlord or any agent or representative, their respective shareholders, directors, officers, employees or rental agents or by any others, except those set forth in this lease or deemed to form part of and to be included in this lease pursuant to Section 1.3. This lease and its Schedules may not be modified except by agreement in writing, executed and delivered by the Landlord and Tenant. 11.11 Governina Law This lease shall be construed in accordance with and governed by the laws of the Province of Ontario. 11.12 Time of the Essence Time shall be of the essence of this lease and every part hereof. H:\LEASES\2002-THEATRE DANCE. DOC LEASE AGREEMENT Page 32 11.13 Quiet Eniovment Subject to Section 4.2, if the Tenant pays Rent, fully performs all of its obligations under this lease, and there has been no Event of Default, the Tenant shall be entitled to peaceful and quiet enjoyment of the Premises for the Term without interruption or interference by the Landlord or any Person claiming through the Landlord. 11.14 No Partnership or Aaencv The Landlord does not in any way or for any purpose become a partner of the Tenant in the conduct of its business, or otherwise, or a joint venturer, or a member of a joint enterprise both the Tenant, nor is the relationship of principal and agent created as a result of the catering into of this lease or the Offer to Lease. H;\LEASES\2002-THEATRE DANCEDOC LEASE AGREEMENT Page 33 ARTICLE XII SPECIAL PROVISIONS 12.1 Schedules Schedules "A" to "E" inclusive, form part of and are included in this lease. H:\LEASES\2002- THEATRE DANCE. DOC LEASE AGREEMENT Page 34 IN WITNESS WHEREOF the Landlord and Tenant have executed this lease under seal. THE CORPORATION OF THE MUNICIPALITY OF CLARINGTON By: .'-"'~ ;~"~ . >. - - ~ - - - - -.'-~.-~- By: COMPANY LIMITED By: Name: Title: By: Name: Title: H:\LEASES\2002-THEATRE DANCE DOC LEASE AGREEMENT Page 24 ARTICLE IX DEFAULT 9.1 Default and Remedies If and whenever an Event of Default occurs, the Tenant shall be deemed to be in default under this lease and, without prejudice to any other rights or remedies which the Landlord may have under this lease or at law, in equity or by statute, the Landlord shall have the following rights and remedies, which are cumulative and not alternative: (i) to terminate this lease by written notice to the Tenant; (ii) to enter the Premises as agent of the Tenant and as such agent to relet the Premises for whatever term and on whatever terms and conditions as the Landlord in its discretion may determine and to receive the rent therefor and, as agent of the Tenant, to take possession of any property on the Premises, to store such property at the expense and risk of the Tenant or to sell or otherwise dispose of such property in such manner as the Landlord may see fit without notice to the Tenant; to make such alterations to the Premises as the Landlord may see fit to facilitate their reletting; and to apply the net proceeds of any such sale or reletting first, to the payment of any expenses incurred by the Landlord with respect to any such reletting, alterations or sale, second to the payment of any indebtedness of the Tenant to the Landlord other than Rent and third, to the payment of Rent in arrears, with the residue to be held by the Landlord and applied in payment of future Rent as it becomes due and payable. The Tenant shall remain liable for any deficiency to the Landlord. No such entering, taking possession, storing, selling, disposing, alterations or reletting shall constitute a termination of this lease unless written notice is given by the Landlord to that effect; (iii) to remedy or attempt to remedy any default of the Tenant under this lease, at the Tenant's sole cost and expense, and to enter upon the Premises for such purposes. No notice of the Landlord's intention to perform such covenants need be given to the Tenant unless expressly required by this lease. The Landlord shall not be liable to the Tenant for any loss, injury or damage whatsoever, howsoever caused by any acts or omissions of the Landlord in remedying or attempting to remedy such default nor shall such entry, remedying or attempting to remedy constitute (I) a termination of this lease (unless written notice is given to that effect), (II) a breach of any covenant for quiet enjoyment or other Landlord's covenant or (III) a constructive or actual eviction or other infringement of any other of the Tenant's rights, and the Tenant shall pay to the Landlord all expenses in connection with remedying or attempting to remedy such default; and (iv) to recover from the Tenant all damages and expenses incurred by the Landlord as a result of any Event of Default or any breach of the Tenant including, without limitation, if the Landlord terminates this lease, the cost of recovering the Premises, solicitor's fees (on a solicitor and his client basis) and including, without limitation, the worth at the time of such termination of the excess, if any, of the amount of Rent and other charges required to be paid pursuant to this lease for the remainder of the Term over the then reasonable rental value of the Premises for the remainder of the Term, all of which amounts shall be immediately due and payable by the Tenant to the Landlord. In determining the Additional Rent which would be payable by the Tenant after such termination or re-entry for an Event of Default, the annual Additional Rent for each year of the unexpired Term shall be considered to be equal to twelve (12) times the average monthly payments of Additional Rent paid and/or payable by the Tenant. H:\LEASES\2002-THEATRE DANCE.DOC LEASE AGREEMENT Page 25 9.2 Distress Notwithstanding any provision of this lease or any provision of applicable legislation, none of the goods and chattels of the Tenant on the Premises at any time during the Term shall be exempt from levy by distress for Rent in arrears, and the Tenant waives any such exemption. If the Landlord makes any claim against the goods and chattels of the Tenant by way of distress, this provision may be pleaded as an estoppel against the Tenant in any action brought to test the right of the Landlord to levy such distress. 9.3 Costs The Tenant shall pay to the Landlord on demand all damages and costs (including, without limitation, all legal fees on a solicitor and its client basis) incurred by the Landlord in enforcing the terms of this lease, or with respect to any matter or thing which is the obligation of the Tenant under this lease, or in respect of which the Tenant has agreed to insure or to indemnify the Landlord. 9.4 Set-Off and Accord and Satisfaction The Tenant hereby waives the benefit of any statutory or other rights in respect of abatement, reduction, set-off, counterclaim, demand, deduction or compensation in its favour at the time hereof and at any future time. No endorsement or statement on any cheque or any letter accompanying any cheque or payment as Rent shall be deemed an acknowledgement by the Landlord of full payment, or an accord and satisfaction, and the Landlord may accept and cash any such cheque or payment without prejudice to the Landlord's right to recover the balance of such Rent or pursue any other right or remedy provided in this lease or at law, in equity or by statute. The Landlord may apply or allocate any sums received from or due to the Tenant against any amounts due and payable under this lease in such manner as the Landlord sees fit. 9.5 Survival of Obliaations If the Tenant has failed to fulfil any of its obligations under this lease with respect to the maintenance, repair, replacement or Alteration of the Premises or Building, or any part thereof, or removal of Leasehold Improvements or its fixtures or personal property from the Premises during or at the expiration or earlier termination of the Term, such obligations, and the Tenant's liabilities and the Landlord's rights with respect thereto, shall survive the expiration or earlier termination of the Term. H:\LEASES\2002-THEATRE DANCE.DOC LEASE AGREEMENT Page 26 9.6 Lien If the Tenant, at any time prior to or during the Term or at the expiration or earlier termination thereof, is in breach of performing or observing any provision of this lease, the Landlord has a lien on all fixtures, equipment and facilities and other personal property of the Tenant as security for the performance and observance of such provision and as security against loss, costs or damages resulting from any such breach by the Tenant and such fixtures, inventory, equipment and facilities and other personal property shall not be removed by the Tenant until such breach is cured, unless otherwise permitted in writing by the Landlord. The provisions of this Section shall survive the expiration or earlier termination of the Term. 9.7 Waiver and Remedies Cumulative The waiver by the Landlord of any breach of any provision herein shall not be deemed to be a waiver of such provision or of any subsequent breach thereof or of any other provision in this lease. The subsequent acceptance of any Rent or other amount herein by the Landlord shall not be deemed to be a waiver of any provision herein or of any preceding breach by the Tenant of any provision herein, even if the Landlord had knowledge of such preceding breach. The Landlord's acceptance of performance of any provision herein by any Person other than the Tenant shall not be deemed to be an acceptance or admission by the Landlord of any rights, title or interest of such Person as Transferee unless in accordance with Article VIII. No provision in this lease nor any breach of any such provision (whether or not continuing or recurring) shall be deemed to have been waived by the Landlord unless such waiver is expressly set out in writing and signed by the Landlord. All rights and remedies of the Landlord under this lease, at law, in equity and/or by statute shall be cumulative and not alternative. Whenever the Tenant seeks a remedy to enforce the observance or performance of any provision in this lease on the Landlord's part to be observed or performed, the Tenant's only remedy shall be for direct damages (but not indirect or consequential damages) that the Tenant shall be able to prove in a court of competent jurisdiction that it has suffered as a direct result of a breach by the Landlord in the observance or performance of any such provision. The right of the Tenant to seek a remedy is, however, expressly subject to the provisions of this lease. H:\LEASES\2002-THEA TRE DANCE-DOC LEASE AGREEMENT Page 35 SCHEDULE "A" FLOOR PLAN ... '.. .~...__..'_._.C"'-"'~"~-.';"a_,. ~ .~_." z .... ~ !ll ~ ><~ ~ ~~ (,) ~5 II. 0 o 0(1) ~w ~~ ~~ ;z:;: ~It~:::l..... ~ON~t!:! ~~go~ ::E-NO... W~D.I/Js:( :I::I:ll.OO I-(,)Q:i::ll:: ~~ ~8: Zll. O"t Q Oll. !i I/JOen ~ ~~~ ll. oq:- 0:: It:1.L.i~ o ~.....<( (,) 1lJQ: ~ ~c I- I ~ W oJ ;:) Q W J: (.) en ". I'. /Tr]-~~ 'v /, / , / '. ---- ---~----~ -. /~,.. ~ = = = = ==== = = = = = AEIIOEa = = = = = = = = = = = = l . . oo... .. ....................... .... ............................. .... 0...................... . ................... . ....................... .. .................oo.......... .. ............................. .. .......................... .. ...............oo.......... .. ............................. . ........................... .. ........ .,_..oo.....oo..... ................................... ................................... ............................. .. ....................oo........ . ..................~................ .......................... . .........oo........... . .......................... . ......... . . . . . . . . . ....~ ~-=- ., ,\~'~ ~ i\~~ 11\\.~~zae ~~f~~ - '2' IIAIIIUIs . J= >t--. - m _ ~lij ij r ~i a --. 1I.1I.1I..Jl.Jl.Jl.Jl .- - ~- - ...... o PHASE ONE LAYOUT 3M _ SIll!ET E:ASr -.a._1I5l\11CI PIL(4111_ID fL (4111 _ ...... til.~_ .' ~:.m ~ FITNESS CENTRE AoomON FOR COURTICE COMMUNITY COMPLEX 'THOMAS E. BROWN ARCRTECT we. H:\LEASES\2002-THEATRE DANCE-DOC LEASE AGREEMENT Page 36 . SCHEDULE "B" DEFINITIONS In this lease and in the Schedules to this lease: "Additional Rent" means all sums of money required to be paid by the Tenant under this lease (except Net Rent and except as may otherwise be expressly provided in this lease) whether or not designated "Additional Rent" or payable to the Landlord or otherwise. "Alterations" means all repairs, replacements, improvements, additions or alterations to the Premises by the Tenant. "Architect" means the architect from time to time named or employed by the Landlord. "Authorities" means the municipal and regional, provincial and federal government including, without limitation, their agencies, commissions, authorities, branches or departments and any other governmental body or corporate authority having or claiming jurisdiction over the Building or the Premises, or any part thereof, or over the operations of the Landlord or the Tenant. Any reference to the term "Authority" shall include, without limitation, the insurance companies writing the insurance policies covering the Building or Premises, or any part thereof, the Insurers Advisory Organization of the Landlord or Owner(s) or any other body hereafter constituted exercising similar functions, and the police and fire departments having or claiming jurisdiction over the Building or Premises, or any part thereof, unless there is something in the context inconsistent therewith. "Authorized Officer" means the Director of the Landlord's Department of Community Services or his designate. "BOMA" means the "Standard Method for Measuring Floor Area in Office Buildings (American National Standard Z 65.1-1980) prescribed by Building Owners and Managers Association International, reprinted May, 1981. "Building" means the Lands and the building known municipally as of the date of this lease as the Courtice Community Complex and which is known for municipal purposes as 2950 Courtice Road, Courtice, and is located on a portion of the Lands. "Business Tax" means (i) all taxes, rates, duties, assessments and other charges that are levied, rated, charged or assessed by any Authority against or in respect of all Leasehold Improvements, Trade Fixtures and Tenant's personal property on or in the Premises or any parts thereof, or the Landlord or Owner(s) on account of its ownership thereof or interest therein and (ii) every tax and license fee which is levied, rated, charged or assessed against or in respect of any and every business carried on in the Prernises or in respect of the use or occupancy thereof or any other part of the Building by the Tenant and every subtenant or licensee or permitted occupant of the Tenant or against the Landlord or Owner(s) on account of its ownership thereof or interest therein. "Change of Control" means, the case of any corporation or partnership, the transfer or issue by sale, assignment, disposition, subscription, transmission on death, mortgage, charge, security interest, operation of law or otherwise, of any shares, voting rights or interest which would result in any change in the effective control of such corporation or partnership. . "Commencement Date" means the date on which the Term shall commence under Section 1.2. H:\LEASES\2002- THEATRE DANCE DOC LEASE AGREEMENT Page 37 "Common Facilities" means the lobbies, public entrances and washrooms within the Building. "Construction Area of the Building" is measured in accordance with BOMA, subject to the terms hereof, and means the "Construction Area" of the Building, all as determined by the Architect. The Construction Area of the Building may be adjusted by the Architect from time to time to take account of any structural, functional or other change affecting the same. An "Event of Default" shall occur whenever: (i) the Tenant fails to pay any Rent or other sums due under this lease on the day or dates appointed for the payment thereof, whether or not any notice of such failure is given to the Tenant or any demand for payment has been made by the Landlord; (ii) the Tenant fails to observe or perform any of the terms, covenants or conditions of this lease to be observed or performed by the Tenant (other than the payment of Rent and the terms, covenants and conditions set out below under (iii) to (x), inclusive, of this paragraph, for which no notice is required) and (I) fails to remedy such failure within fifteen (15) days (or such shorter period as may be provided in this lease) or (II) if such failure cannot reasonably be remedied within fifteen (15) days or such shorter period and the Tenant fails to commence to remedy such failure within such fifteen (15) days or shorter period or thereafter fails to proceed diligently to remedy such failure, in either case after notice in writing from the Landlord to the Tenant; (iii) the Tenant or Indemnifier becomes bankrupt or insolvent or takes the benefit of any statute for bankrupt or insolvent debtors or makes any proposal, assignment, arrangement or compromise with its creditors, or if a petition in bankruptcy is filed against the Tenant or Indemnifier or any steps are taken or proceedings commenced by anyone or any court or governmental body for the dissolution, winding-up or other termination of the Tenant's or Indemnifier's existence or the liquidation of its assets; (iv) a trustee, receiver, receiver/manager or like Person is appointed with respect to the business or assets of the Tenant or Indemnifier; (v) this lease or any of the Tenant's assets are seized or taken under any writ of execution or similar process or if any encumbrancer of this lease or the Tenant's assets shall take any action to enforce its security, (vi) the Tenant purports to make or makes any Transfer or the Premises or any part thereof is occupied or used by any Person or for any business or purpose other than in compliance with the provisions of this lease or if the Tenant suffers to exist, creates or incurs any charge, privilege, pledge, security interest or other encumbrance whatsoever on any of its moveable effects or chattels situated in the Premises; (vii) the Tenant abandons or attempts to abandon the Premises or sells or disposes of its goods or chattels or removes them from the Premises so that there would not in the event of such sale, disposal or removal be sufficient goods and chattels of the Tenant on the Premises subject to distress to satisfy all Rent payable for at least twelve (12) months, or the Premises or any part thereof becomes vacant or unoccupied for a period of 10 consecutive days or more without the prior written consent of the Landlord, or if the Tenant fails to continuously. actively and diligently conduct its business in the whole of the Premises, fully fixtured and staffed and otherwise in compliance with Section 1.4; (viii) an Event of Default as defined in this paragraph occurs with respect to any lease or agreement under which the Tenant occupies or has the right to use other premises or space in the Building, (ix) a report, statement, certificate or opinion required to be provided by or from the Tenant or any of its officers or agents under this lease is false or misleading in any respect except for a misstatement that is the result of an innocent clerical error; or (x) re-entry or the right to terminate by the Landlord is permitted under any other provision of this lease or at law or by statute. "HVAC System" means the heating, ventilation, air-conditioning and other climate control equipment, facilities and systems serving the Building or any part thereof, including, without limitation, any and all (i) equipment, improvements and installation, (ii) duct work, diffusers, distribution piping, air handling units and ventilation units and (iii) monitoring, conservation and control systems. H:\LEASES\2002-THEATRE DANCEDOC LEASE AGREEMENT Page 38 "Indemnifier" means the Party of the Third Part and includes their respective heirs, executors, administrators and assigns. "Landlord" means the party of the First Part and includes the Landlord and its duly authorized representatives, agents and managers, and without limiting the generality of any provision of this lease, where the context permits, such as, without limitation, in Sections 4.1 and 4.2, "Landlord" includes, without limitation, the Landlord and its agents and managers, the respective employees, contractors and workmen of each of them, and the respective heirs, executors, administrators, successors and assigns of each of the foregoing. "Leasable Area" means the interior area of part of the Building and the exterior area comprising part of the Lands to the extent designated or intended from time to time by the Landlord in its sole discretion to be leased to tenant but excluding the following: (i) parking areas and facilities; (ii) Storage Areas and (iii) Common Facilities. "Leasehold Improvements" means leasehold improvements in the Premises determined according to common law, but shall include, without limitation, all improvements, installation alterations and additions from time to time made, erected or installed in, to or on the Premises by or on behalf of the Tenant or any previous occupant of the Premises, including, without limitation, signs and lettering, partitions, doors and hardware, however affixed and whether or not movable, all mechanical, electrical and Utility installations and all carpeting and drapes. "Net Rent" means the unpaid minimal rent payable by the Tenant under Section 2.2. "Offer to Lease" means the offer to Lease referred in section 1.3 "Person" means any person, firm, partnership or corporation (including, without limitation, a trust company), or any group or combination of persons, firms, partnerships or corporations. "Premises" means the interior area and the exterior play area of the premises leased to the Tenant described in Section 1.1 and includes, without limitation, Leasehold Improvements, and means the premises as relocated pursuant to Section 3.3, and includes, without limitation, Leasehold Improvements in such premises as relocated. The interior area of the Premises shall extend from the upper surface of the structural subfloor to the lower surface of the suspended ceiling within the boundaries of the Premises determined as provided in the definition of "Useable Area" contained herein. The interior area of the Premises shall exclude the exterior faces of (i) the Building and (ii) all exterior and demising interior walls and windows, notwithstanding the manner in which the Useable Area is measured. "Prime Rate" means the variable annual rate of interest (which is calculated daily) established from time to time by the head office in Toronto of any Canadian chartered bank designated by the Landlord, from time to time, as the reference rate it will use to determine rates of interest payable by the most preferred commercial borrowers of such bank on unsecured loans to such borrowers in Canada (as distinct from the rate of interest chargeable for small business loans sometimes referred to as the "prime small business loans interest rate"), current during the applicable period that any amount bears interest under this lease. "Rent" means the aggregate of Net Rent and Additional Rent H:\LEASES\2002.THEATRE DANCE DOC LEASE AGREEMENT Page 39 "Rentable Area" is measured in accordance with BOMA, subject to the terms hereof, and means (i) in the case of premises (whether leased or not) consisting of an entire floor, the floor area measured to the inside finished surface of the dominant portion of the permanent outer building walls, including, without limitation, washrooms, telephone, electrical and janitorial closets and elevator lobbies, and no deductions shall be made for columns and projections necessary for the Building and (ii) in the case of the Premises consisting of part of a floor, the area computed by multiplying the Useable Area of such premises by a factor of 1. . The Landlord, for the purpose of calculating the Net Rent may change the factor referred to in (ii) from time to time to reflect the actual ratio of the aggregate floor area of the floor on which the Premises are located (using the measurement method set out in (i)) to the aggregate Useable Area of all premises (whether leased or not) on such floor. "Rental Year" means the twelve 12) month period ending on (January 31). If, however, the Landlord considers it necessary or convenient for the Landlord's accounting purposes, the Landlord may at any time and from time to time, by written notice to the Tenant, specify an annual date from which each subsequent Rental Year shall commence, and, in that event, the then current Rental Year shall terminate on the day preceding the commencement of the new Rental Year. The first Rental Year of the Term shall be deemed to commence on the Commencement Date and to expire on the last day of April next ensuing or upon the earlier termination of the Term. The last Rental Year of the Term shall be deemed to end upon the expiration or earlier termination of the Term. "Restoration" means the repairing, replacing, altering, demolishing or rebuilding of all or any part of the Premises or Building. "Rules and Regulations" means the rules and regulations established by the Landlord from time to time in accordance with the provisions of this lease. The Rules and Regulations established as at the Commencement Date are those set out in Schedule "011, "Sales Taxes" means any and all goods and services taxes, sales taxes, multi-stage sales taxes, value added taxes, business transfer taxes, use taxes, consumption taxes or any other taxes imposed by any Authority on the Tenant or on the Landlord or which the Landlord is required to remit to any Authority with respect to Rent paid or payable by the Tenant under this lease, or imposed by any Authority in respect of this lease or the rental or any licensing or use of space under this lease, or in respect of the payments made or payable by the Tenant under this lease, or in respect of the goods and services purchased by or provided by the Landlord under this lease, including, without limitation, the provision of administrative services to the Tenant under this lease, whether characterized as goods and services taxes, sales taxes, multi-stage sales taxes, value added taxes, business transfer taxes, use taxes, consumption taxes or otherwise. "Taxes" means all taxes, rates, duties, levies, fees, charges, local improvement rates and assessments whatsoever now or in the future imposed, levied, rated, assessed or charged against the Building, the Premises or any part thereof by any lawful taxing Authority or allocated or attributed by the Landlord to the Premises and including, without limitation, any amounts assessed, imposed, levied, rated or charged in substitution for or in lieu of or in addition to any of the foregoing whether of the foregoing character or not or in existence at the Commencement Date or not, but excluding only such taxes as capital gains taxes, or corporate, income, profit or excess profit taxes to the extent such taxes are not so levied in lieu of any of the foregoing and to the extent such taxes are not expressly included in this Section or in any other Section of this lease. . H:\LEASES\2002.THEATRE DANCE-DOC LEASE AGREEMENT Page 40 "Tenant" means the party of the Second Part and is deemed to include the word lessee and includes every Person mentioned as Tenant in this lease. "Term" means the period of time as provided in Section 1.2. "Transfer" means an assignment of this lease in whole or in part, a sublease of all or any part of the Premises, any transaction whereby the rights, title or interest of the Tenant under this lease or in or to the Premises are transferred to another, any transaction whereby any right of use or occupancy of all or any part of the Premises is conferred upon anyone, any parting with or sharing the occupation or possession on or of the whole or any part of the Premises, any mortgage, charge or encumbrance of this lease or the Premises or any part thereof or other arrangement under which either this lease or the Premises become security for any indebtedness or other obligations and includes, without limitation, any transaction or occurrence whatsoever (including, but not limited to, expropriation, receivership proceedings, seizure by legal process and transfer by operation of law), which changes or might exchange the identity of the Persons having lawful use or occupancy of any part of the Premises. "Transferee" means the Person or Persons to whom a Transfer is or is to be made. "Useable Area" is measured in accordance with BOMA, subject to the terms hereof, and means in the case of the Premises, the floor area measured to the finished surface of the Library side of corridor and other permanent walls, to the centre of partitions that separate the premises from the adjoining Library and to the inside finished surface of the dominant portion of the permanent outer building walls, without deductions for columns or projections necessary to the Building. "Utilities" means, collectively, water, fuel, electricity, sewage, waste collection and disposal and other utilities and "Utility" means any of them. The terms do not include the cost of water, gas or electricity meters which may be installed to serve the Premises at the Landlord's expense. H:\LEASES\2002-THEATRE DANCE. DOC LEASE AGREEMENT Page 41 SCHEDULE "C" RULES AND REGULATIONS 1. Removal of Refuse The Tenant shall not (i) place or leave or permit to be placed or left any debris, garbage, trash or refuse in or upon any part of the Building outside of the Premises except in locations, at times, in the manner and in containers designated from time to time by the Landlord for such purposes or (ii) permit undue accumulations of debris, garbage, trash or refuse within the Premises or (iii) cause or permit undesirable odours, vapours, steam, water, vibrations, noises or other undesirable effects to emanate or to be dispelled from the Premises which the Landlord, in its sole discretion, acting reasonably, determines to be undue, undesirable, objectionable or unsafe. The Tenant shall comply with such recycling and waste management programs as the Landlord may establish from time to time. 2. Securitv At times other than during normal operating hours, the Tenant and all others, including, without limitation, Persons lawfully requiring communication with the Tenant, shall comply with any and all security and restricted access requirements as established from time to time by the Landlord for the Building in accordance with the Landlord's then current security and operating procedures. If such requirements are not observed or complied with, or if identification of Persons is not satisfactory to the Landlord, the Landlord shall be entitled to prevent access to the Building and to the Premises. 3. Locks The Tenant shall not place or permit any additional locks upon any doors of the Premises without the prior written approval of the Landlord, which approval may be subject to the Landlord's reasonable conditions. A reasonable number of keys shall be supplied to the Landlord for each entrance door to the Premises and all locks shall be Building standard to permit access by the Landlord's master key. If additional keys are required, they shall be obtained from the Landlord at the Tenant's expense. Keys or other means of access for entrance doors to the Building shall not be issued without the prior written authority of the Landlord. The Tenant shall indemnity the Landlord from and against any expense resulting from any forced entry to the Premises which may be required in case of emergency or apprehended emergency, as determined by the Landlord, whether or not entrance keys have been provided to or used by the Landlord. At the expiration or earlier termination of the Term, the Tenant, at the Landlord's request, shall remove any and all additional locks at the Tenant's expense and, in any event, shall return to the Landlord all keys to the Premises and Building and all security and restricted access passes and identification cards. The Tenant shall obtain all such cards and all keys from its employees and other Persons to whom such cards and keys have been issued, upon the termination of their employment, association or retainer, and shall promptly return them to the Landlord. 4. Obstructions The Tenant shall not do, nor permit to be done, any act in, on or about the Building and the Lands, including without limitation the sidewalks, streets or passageways adjacent or near the Buildings, which, in the Landlord's opinion, hinders or interrupts the flow of traffic to, in or from the Building, or any part thereof. Without limiting the foregoing, (i) the Tenant shall not park or leave, nor permit to be parked or left, any of its vehicles or the vehicles of any of its agents, employees, invitees, licensees, visitors, customers, clients, contractors, sub-tenants, assignees or Persons lawfully requiring communication with the Tenant in such a manner or in such a place as to obstruct access to any part of the Building, but not limited to, the driveway, fire zone, delivery zone, loading dock or garbage pick-up area and (ii) the sidewalks, entries, passages, escalators, elevators and staircases (if any) shall not be obstructed, and shall not be used by the Tenant or others, for any purpose other than for ingress and egress from H:\LEASES\2002-THEATRE DANCE.DOC LEASE AGREEMENT Page 42 the Premises. 5. Receivina. Shippina and Movement of Articles The Tenant shall not bring in or take out, position, construct, install or move any furniture, fixtures, improvements, safes, business machinery or other equipment or anything liable to damage or destroy any part of the Premises or Building, nor permit any of the foregoing, without first obtaining the prior written consent of the Landlord. In giving such consent, the Landlord shall have the right, in its sole discretion, to prescribe the weight permitted and the position thereof, and the use and design of planks, skids or platforms to distribute the weight thereof. All damage done to the Premises or Development by moving or using any such heavy equipment or other equipment, furniture or other article shall be repaired at the expense of the Tenant. The moving of all equipment, fixtures, fumiture and other articles shall occur only upon prior arrangement with and under the supervision of the Landlord. The Tenant shall not receive or ship, load or unload articles of any kind except through facilities and designated doors and at hours designated by and under the supervision of the Landlord. No Tenant shall employ anyone to do its moving in the Building other than Persons prior approved in writing by the Landlord. The cost of such moving shall be paid by the Tenant. Safes and other heavy equipment and machinery shall be moved through the halls and corridors only upon steel bearing plates. No freight or building matter of any description shall be received into the Building or carried in the elevators except during hours prior approved in writing by the Landlord. Any hand trucks, carryalls or similar equipment used in the Building shall be used only with the prior written consent of the Landlord and shall be equipped with rubber tires, slide guards and such other safeguards as the Landlord may require. 6. Washrooms The washrooms and other water and plumbing fixtures and facilities shall not be used for any purpose other than those for which they are constructed. No sweepings, rubbish, rags, ashes or other substances shall be thrown therein. Any damage resulting from misuse by the Tenant or any of its agents, employees, invitees, visitors, customers, clients, contractors or licensees shall be borne by the Tenant. No water shall be permitted to run unless it is in actual use for its intended purposes. The Tenant and its employees and customers shall use only those washrooms forming part of the Common Facilities directed by the landlord from time to time. 7. Use of Premises The Premises shall not be used for any illegal purpose or for sleeping apartments or residential purposes or for the storage of personal effects or articles other than those personal effects and personal articles required for the Tenant's business purposes. 8. Solicitation No canvassing, solicitation, peddling or distribution of handbills or other advertising matter nor any displaying of any merchandise shall be permitted in or about the Building unless otherwise prior approved in writing by the Landlord. 9. Iniury Prevention The Tenant shall assist and co-operate with the Landlord in preventing bodily injury within or damage to the Premises and the Building. Except with the prior written consent of the Landlord, the Tenant shall not deface or mark any part of the Building or Premises nor drive nails, spikes, hooks or screws into, nor bore, drill or cut into, the walls, floors, ceilings,woodwork or any other part of the Building or the Premises in any manner or for any reason or purpose. The Tenant shall perform Tenant's maintenance and Alterations in the Premises only during the times prior approved in writing by the Landlord and only in such manner as will not interfere with the rights of other tenants or occupants of the Building. The Tenant shall not use or permit any use of the Premises, or any part thereof, which involves the danger of injury to any Person or for any dangerous, noxious or offensive trade or business, all as determined by the Landlord in its sole discretion, acting reasonably. H\LEASES\2002-THEATRE DANCE-DOC LEASE AGREEMENT Page 43 10. Inflammable Materials No inflammable oils or other inflammable, combustible, dangerous, explosive, hazardous or toxic materials or substances, save those prior approved in writing by the Landlord and its insurers, shall be kept or permitted to be kept by the Tenant in any part of the Premises. Without limiting the foregoing, no propane or natural gas powered vehicles nor any vehicles containing or carrying compressed inflammable gases shall be permitted entry or shall be parked in any part of the Lands. 11. Bicvcles and Animals No bicycles or vehicles and no animals, birds, reptiles or insects shall be brought within any part of the Building without the prior written consent of the Landlord. 12. Dispensina Machines The Tenant shall not (I) install or permit the installation or use of any machine dispensing food, liquid or goods for sale or rental, rendering services or providing entertainment in the Premises or the Building and (ii) permit the delivery of any food or liquid to the Premises, other than for the consumption by its employees, in each case without the prior written approval of the Landlord or in contravention of any Rules and Regulations. Only Persons prior approved in writing by the Landlord from time to time shall be permitted to prepare, solicit orders for, sell, serve, distribute or deliver food or liquid in or to any part of the Building or Premises, or to use the elevators, corridors or other Common Facilities for any such purpose, except as otherwise expressly provided herein. 13. Cable and Communications If the Tenant desires telegraphic, facsimile, cable or telephonic connections, the Landlord will direct the electricians as to where and how the wires are to be introduced, and without such directions no boring or cutting for wires shall be permitted. No gas pipe or electric wire shall be permitted which has not been ordered or authorized in writing by the Landlord. No aerials or radio, television or other receiving, transmitting or audio-visual device shall be allowed on the Premises, on the exterior walls of the Premises or in or on the Building or the Lands, or any part thereof, without prior written authorization by the Landlord. 14. Smokina No smoking shall be permitted in the Premises or the Building. 15. Structural Alterations The Tenant shall not undertake to the Premises without the prior written approval of the Authorized Officer. 16. Complaints The Tenant shall maintain a written record of complaints that may be made to the satisfaction of the Authorized Officer and make the same available to and discuss the complaints with the Authorized Officer when requested to do so by the Authorized Officer. The Tenant shall respond to all complaints and suggestions by its customers including parents in a prompt, courteous and efficient manner. H:\LEASES\2002-THEATRE DANCE DOC LEASE AGREEMENT Page 44 SCHEDULE "0" December 18, 2002 OFFER TO LEASE TO: THE CORPORATION OF THE MUNICIPALITY OF CLARINGTON We, , having the floor plans of the building (the "Building") on the lands shown for municipal purposes as 2950 Courtice Road, Courtice, Ontario, and to be known as the Courtice Community Complex and the plan of the Lands on which it is to be located, offer to lease from you on those certain premises (the "Premises") part of which comprise an area within the Building of about 1,600 square feet on the ground floor on the plans attached as Schedule "A" hereto. The term of the lease shall be five years commencing on whichever of the days shall occur first: (1) February 1, 2003, and (2) the day upon which possession of the Premises is given to us; . Within 14 days following the execution of this Offer to Lease by you we will engage a qualified Architect and Engineer to prepare detailed floor plans and shop drawings for the improvement of the Premises ("Leasehold Improvements") and submit the same for the approval of your Director of Community Services whose approval shall not be unreasonably withheld. The Leasehold Improvements if required by you or by a responsible authority shall include but not be limited to: (i) security; (ii) lighting-interior/exterior; (iii) fire alarm system; (iv) fire extinguishers; (v) acoustical baffling; (vi) plumbing, electrical; and (vii) sprinkler systems. Forthwith after this Offer to Lease becomes unconditional we shall reimburse you for any ArchitectlEngineering fees incurred by the Municipality respecting the Leasehold Improvements including reviewing and approving of the detailed floor plans of the Premises and the shop drawings for the Leasehold Improvements. You shall allow us to enter on the Premises at the lease commencement date for the purpose of constructing and installing thereon at our cost Leasehold Improvements which shall be constructed or installed in accordance with the shop drawings approved by the Director of Community Services, provided that we will pay all suppliers of services and materials in a timely marmer, so that claims for construction liens will not be registered on title. Prior to permitting any supplier to deliver materials or equipment to be used in and prior to commencing the construction or installation of the Leasehold Improvements, we shall provide you with documentation satisfactory to the Director of Community Services and your Director of Finance to assure you that all suppliers of services and materials used in the construction of Leasehold Improvements will be paid in full therefor. Forthwith after each occasion on which you request the same by notice in writing to us, we will provide you with proof satisfactory to you that all suppliers have been paid, or if that is not the case, the names, addresses, and particulars of the claims of suppliers. If any construction lien claim is registered on title we will indenmify you against your costs, including your reasonable legal costs, of having the same extinguished or satisfied. Prior to the Commencement Date and the delivery of possession to us of the Premises, we shall execute and deliver a Lease of the Premises in the form and with the content of the lease contained in Schedule "B" hereto and forming part of Offer to Lease. A certified cheque for $1,466.60 payable to you is delivered herewith as a deposit to be applied against: (i) the claims, if any, of unpaid suppliers of materials or services respecting thcLeasehold Improvements; and (ii) either the completion of the approved Leasehold Improvements by you if we fail to complete them in accordance with the approved shop drawings or the restoration of the Premises to a condition H:\LEASES\2002-THEATRE DANCE-DOC LEASE AGREEMENT Page 45 satisfactory to the Municipality's Director of Community Services as he may determine to be appropriate and if any balance remains unexpended, to apply the balance against the "Net Rent" (as defined in the draft lease) accruing due in the period immediately following the earlier of the Commencement Date and the date on which either you give us written notice that you are satisfied with the proof with which we provide you that there are no unpaid suppliers or you give us written notice that you have completed the Leasehold Improvements or restored the Premises to a satisfactory condition. The deposit shall be refunded without interest or deduction to us if this Offer to Lease is not accepted by you or if it terminates because any of the conditions set out below are not satisfied as provided herein. The Premises are to be used only for the pwpose of a dance school. Further, that when you have completed construction of the Premises and made available the services, we shall not be entitled to any abatement of rent for delay in occupancy due to our failure to complete the installations and other work required for our pwposes or for any other reason. A certificate of your Architect that the construction of the Premises is complete and the services to be furnished by you are available shall be submitted to the Director of Community Services. It is agreed there are no covenants, representations, agreements, warranties or conditions expressed or implied, collateral or otherwise, except as expressly set out in this agreement. In our personal capacities and not as trustees for a company incorporated, we guarantee to indemnify you against any loss or cost, including your reasonable legal fees, which you may incur if the company fails to pay to suppliers of services or materials the cost of Leasehold Improvements, in accordance with this Offer to Lease. This offer is irrevocable until [time] on the day of February 28,2003, after which time if not accepted this offer is void, and the deposit will be returned to us. DATED thi;31-- day of December 2002. THE CORPORATIO~-Q.F'FfIE:~-., MUNICIPALI . -Cl{A:lUNGTON.: . . . ::--" .~'-<-~ ",/ '. - If ,- .. _ _ By: .' _.- : '^ . - , By: ,-:K _ _S'~~~~c;ju-~i-- 6'3r as tt.16tee fef a eeRlpmv~u ~c lul".;urpvldlGd I!v,~ K";:''':'~J t3s~ as t.u~kc [VI d I.;UJIIpauy t5 Be ia881poldtGd 55r ift hig l'c:rseflftl ettpocit, THE CORPORATION OF THE MUNICIPALITY OF CLARlNGTON accepts this offer to lease. DATED this ~ day of December, 2002. THE CORPORATION OF THE MUNICIPALITY OF CLARINGTON H:\LEASES\2002-THEATRE DANCE.DOC LEASE AGREEMENT By: By: Page 46 H\LEASES\2002-THEATRE DANCE.DOC