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HomeMy WebLinkAbout07 095 Muncipal Admin Centre Bruce Power L.P. (2007)n Lease Agreement THE CORPORATION OF THE MUNICIPALITY OF KINCARDINE . BY-LAW NO. 2007 - 095 BEING A BY-LAW TO AUTHORIZE THE SIGNING OF A LEASE AGREEMENT WITH BRUCE POWER L.P. FOR RENTAL SPACE IN THE MUNICIPAL ADMINISTRATION CENTRE, 1475 CONCESSION 5, MUNICIPALITY OF KINCARDINE . WHEREAS Section 8 (1) of the Municipal Act, 2001, S.D. 2001, c. 25, as amended, provides that the powers of a municipality under this or any other Act shall be interpreted broadly so as to confer broad authority on the municipality to enable the municipality to govern its affairs as it considers appropriate and to enhance the municipality's ability to respond to municipal issues; AND WHEREAS pursuant to the said Municipal Act, Section 9 provides that a municipality has the capacity, rights, powers and .privileges of a natural person for the purpose of exercising its authority under this or any other Act; AND WHEREAS the Council for The Corporation of the Municipality of Kincardine deems it advisable to enter into a lease agreement with Bruce Power L.P., in consideration of the rents, covenants and obligations stipulated therein; NOW THEREFORE the Council for The Corporation of the Municipality of Kincardine ENACTS as follows: 1. That The Corporation of the Municipality of Kincardine enter into a lease agreement with Bruce Power L.P. for the rental of commercial office space at the Municipal Administration Centre, 1475 Concession 5, Municipality of Kincardine in consideration of rents, covenants and obligations. . 2. That the Mayor and CAD be authorized to sign, on behalf of The Corporation of the Municipality of Kincardine, the Lease Agreement with Bruce Power L.P. attached hereto as Schedule "An. 3. That this by-law shall come into full force and effect upon its final passage. 4. That this by-law may be cited as the "Municipal Administration Centre, Bruce Power L. P. (2007) Lease Agreement, By-law". READ a FIRST and SECOND TIME this 4th day of July, 2007. c?~/~ . _R~ a T~9~ and FINALLY PAS~ this 4th day Ofv.;;' 2007. (~~ -, ,.".~ lerk . This is Schedule" il.. "to By-Law No.o?OOI-09's'passed the L../P> day ---J of~ 20071/; LEASE ~ ~k1 S-+ THIS LEASE made as of the I day of J fJrV IN PURSUANCE OF THE SHORT FORMS OF LEASES ACT BETWEEN: THE CORPORATION OF THE MUNICIPALITY OF KINCARDINE (hereinafter called the "Landlord") OF THE FIRST PART - and - BRUCE POWER L.P. (hereinafter called the "Tenant") OF THE SECOND PART In consideration of the rents, covenants and obligations stipulated herein the Landlord and the Tenant have agreed to enter into a Lease of certain premises shown double crosshatched on the sketch annexed hereto as Schedule "A" ("Premises") being that part of the building (the "Building") municipally known as 1475 Concession 5, R. R. #5, Kincardine, Ontario located on the lands and premises (the "Real Property") legally described as Parts of Lots 29 and 30, Concession "A", Township of Kincardine (now Municipality of Kincardine), County of Bruce, designated as Parts 1 and 2 on Reference Plan 3R-5856. 1. GRANT OF LEASE (a) The Landlord leases the Premises to the Tenant; 1. at the Rent set forth in Section 2; 11. for the Term set forth in Section 3; and 111. subject to the conditions in accordance with the covenants, obligations and agreements herein. (b) The Landlord covenants that it has the right to grant the leasehold interest in the Premises free from any and all encumbrances save and except as set out in Schedule "B" hereto. 2. RENT (a) "Rent" means the amounts payable by the Tenant to the Landlord pursuant to this Section, and includes any amounts payable as additional rent by the Tenant to the Landlord hereunder. (b) The Tenant covenants to pay to the Landlord, during the Term of this Lease gross annual rent in the amount of TWENTY ONE THOUSAND, NINE HUNDRED, SEVENTEEN DOLLARS (21,917.00) payable in equal month instalments of ONE THOUSAND, EIGHT HUNDRED TWENTY SIX DOLLARS AND FOURTY-TWO CENTS (1,826.42), each in advance on the 1 st day of each and every month, the first payment to be made on the 1 st day of July, 2007 and the last such payment to be made on the 1st day of June, 2008. (c) The Tenant further covenants to pay to the Landlord Goods and Services Tax ("GST") on the Rent. The amount of GST shall be calculated in accordance with the applicable legislation and shall be paid at the same time as the rent to which the GST applies is payable to the Landlord under this Lease. The Landlord shall have the same rights and remedies on non-payment of GST as it has for rent in arrears under this Lease. (d) All payments to be made by the Tenant pursuant to this Lease shall be delivered to the Landlord at the Landlord's address for service set out in Section 16 or to such other place as the Landlord may from time to time direct in writing. -2- (e) The Tenant agrees to pay in advance to the Landlord at the commencement of the Term the first and last months' annual rent payable under Section 2(b) of this Lease. (t) All Rent in arrears and all sums paid by the Landlord for expenses incurred which should have been paid by the Tenant shall bear interest from the date payment was due, or made, or expense incurred at a rate per annum equal to the prime commercial lending rate ofthe Landlord's bank plus two (2) per cent. (g) The Tenant further acknowledges and agrees that: 1. the payments of Rent provided for in this Lease shall be made without any deduction for any reason whatsoever unless expressly allowed by the terms of this Lease or agreed to by the Landlord in writing; and 11. no partial payment by the Tenant, which is accepted by the Landlord, shall be considered as other than a partial payment on account of Rent owing and shall not prejudice the Landlord's right to recover any Rent owing. 3. TERM AND POSSESSION a) The Tenant shall have possession of the Premises for a period of one (1) year commencing on the 1st day of July, 2007 and ending on the 30th day of June 2008 (the "Term"). b) Subject to the Landlord's rights under this Lease, and as long as the Lease is in good standing the Landlord covenants that the Tenants shall have quiet enjoyment of the Premises during the Term of this Lease without any interruption or disturbance from the Landlord or any other person or persons lawfully claiming through the Landlord. c) Notwithstanding anything contained herein, provided the Tenant is not otherwise in default of its covenants and obligations hereunder, the Tenant shall not be required to occupy and continuously operate from the Premises as of the commencement of the Term. The Landlord acknowledges that the Tenant requires the Premises primarily for the purposes of off-site emergency operations. 4. COMMON FACILITIES AND SERVICES a) The Tenant, together with and in common with all others entitled thereto and their respective officers, agents, servants, employees, contractors, customers, invitees or licensees, shall be entitled to the use and benefit of the Common Facilities (as defined below). The Tenant shall not unreasonably block or in any manner hinder the Landlord or other persons who may be authorized by the Landlord to utilize the Common Facilities from so doing. The Landlord may, acting reasonably, from time to time permit certain persons to have the exclusive use of portions of the Common Facilities to the exclusion of the Tenant and other persons, provided that the Tenant shall at all times have unrestricted access to and use of the Premises and the washrooms, stairways and elevators and such other portions or elements of the Common Facilities necessary for the Tenant's use of the Premises; subject to reasonable rules and regulations imposed by the Landlord and subject also to reasonable limitations imposed by the Landlord while it is making repairs which it is obligated to make pursuant to the provisions of this Lease provided that the landlord makes such repairs with all reasonable diligence. b) As part of this Lease, the Landlord shall supply at its sole cost and expense the utilities for the Premises being electricity, water, heat and air-conditioning and shall further be responsible for providing, repairing and maintaining the elevators, existing security systems, snow ploughing, lawn maintenance, custodial services to the Building and garbage collection and removal. The Landlord shall be responsible for, at its sole cost and expense, any and all repairs and replacements to all structural elements of the Building and the Premises. - 3 - c) For the purposes of this Lease, "Common Facilities" means all common areas and utilities from time to time furnished or designated (and which may be changed provided such changes do not materially or adversely affect the access to or the Tenant's use of the Premises) by the Landlord for the use in common, in such manner as the Landlord may permit, of tenants of premises in the Building and all others entitled to access and their respective officers, agents, servants, employees, contractors, customers, invitees or licensees, including, without limitation, parking areas, access roads, driveways, entrances and exits, sidewalks, ramps, landscaped areas, Building entrances, lobbies, stairways, elevators, passageways and washrooms. 5. ASSIGNMENT a) The Tenant shall not assign this Lease or sublet the whole or any part of the Premises unless it first obtains the consent of the Landlord in writing, which consent shall not unreasonably be withheld, delayed or conditioned. b) The Tenant hereby waives its right to the benefit of any present or future Act of the Legislature of Ontario, which would allow the Tenant to assign this Lease or sublet the Premises without the Landlord's consent. c) The consent of the Landlord to any assignment or subletting shall not operate as a waiver of the necessity for consent to any subsequent assignment or subletting. d) Any consent granted by the Landlord shall be conditional upon the assignee, sublessee or occupant executing a written agreement directly with the Landlord agreeing to be bound by all the terms of this Lease as if the assignee, sublessee or occupant had originally executed this Lease as Tenant. e) Any consent given by the Landlord to any assignment or other disposition of the Tenant's interest in this Lease or in the Premises shall not relieve the Tenant from its obligations under this Lease, including the obligation to pay Rent and Additional Rent as provided for herein. 6. USE a) During the Term ofthe Lease the Premises shall not be used for any purpose other than commercial office purposes and any lawful use ancillary thereto. The Landlord hereby represents and warrants the use herein is permitted by all applicable zoning by-laws. b) The Tenant shall only make such reasonable use of the utilities supplied to the Premises, as would a reasonable tenant using the Premises for commercial office purposes. c) The Tenant shall not do or permit to be done at the Premises anything which may: 1. constitute a nuisance; 11. cause damage to the Premises; 111. cause injury or annoyance to occupants of neighbouring premises; IV. make void or voidable any insurance upon the Premises, provided, however, in the case of any insurance maintained by the Landlord, copies of such policies have been provided to the Tenant; v. constitute a material breach of any by-law, statute, order or regulation of any municipal, provincial or other competent authority relating to the Premises. -4- 7. REPAIR AND MAINTENANCE a) Subject to the Landlord's obligations to repair, replace or maintain hereunder, the Tenant covenants that during the terms of this Lease, and any renewal or extensions thereof, the Tenant shall keep in good condition the Premises including all alterations and additions made thereto, and shall, with or without notice, promptly make all needed repairs and all necessary replacements as would a prudent Owner. Provided, however, but the Tenant shall not be liable to effect repairs or replacements attributable to: i) reasonable wear and tear; ii) damage caused by fire, lightning or storm or any peril against which the Landlord is required to maintain insurance hereunder; iii) damage caused by, or arising from, defective materials or faulty workmanship or other defects in the construction, repair or replacement of the structural elements of the Building; iv) damages caused by the acts or omissions of the Landlord or any other persons for whom it is responsible at law, or the acts or omissions of any other tenant or occupant of the Building. b) The Landlord hereby represents and warrants that, as of the commencement of the Term, the Common Facilities shall be in a good state of repair and that the electrical, mechanical and other systems servicing the Building and the Premises shall be in good working order. c) The Tenant shall permit the Landlord or a person authorized by the Landlord to enter the Premises to examine the condition thereof and view the state of repair at reasonable times: i) and if upon such examination repairs required to be made by the Tenant hereunder are found to be necessary, written notice of the specific repairs required shall be given to the Tenant by or on behalf of the Landlord and the Tenant shall make such repairs within the time specified in the notice; ii) if the Tenant refuses or neglects to keep the Premises in good repair the Landlord may, but shall not be obliged to, make any necessary repairs, and shall be permitted to enter the Premises, by itself or its servants or agents, for the purpose of effecting the repairs without being liable to the Tenant for any loss, damage or inconvenience to the Tenant in connection with the Landlord's entry and repairs; and iii) if the Landlord makes any repairs the Tenant shall pay the actual cost of such repairs as additional rent upon presentation to the Tenant of invoices and/or receipts for the cost of the repairs. d) Upon the expiry of the Term or other determination of this Lease the Tenant agrees peaceably to surrender the Premises, including any alterations or additions made thereto, to the Landlord subject only to the Tenant's repair obligations hereunder. e) The Landlord and the Tenant shall immediately give written notice to the other party of any substantial damage that occurs to the Premises from any cause. 8. ALTERATIONS AND ADDITIONS a) If the Tenant, during the Term of this Lease or any renewal of it, desires to make any alteration or addition to the Premises, including but not limited to: erecting partitions, attaching equipment, and installing necessary furnishing or additional equipment of the Tenant's business, the Tenant may do so at its own expense, at any time and from time to time, if the following conditions are met: - 5 - 1. before undertaking any alteration or addition the Tenant shall submit to the Landlord a plan showing the proposed alterations or additions and the Tenant shall not proceed to make any alteration or addition unless the Landlord has approved the plan, and the Landlord shall not unreasonably or arbitrarily withhold, delay or condition its approval; 11. items included in the plan which are regarded by the Tenant as tenant trade fixtures ("Trade Fixtures") shall be designated as such on the plan; and 111. any and all alterations or additions to the Premises made by the Tenant must comply with all applicable building code standards and by-laws of the municipality in which the Premises are located. b) With the exception of those costs which the Landlord is responsible to incur, the Tenant shall be responsible for and pay the cost of any alterations, additions, installations or improvements that any governing authority, municipal, provincial or otherwise, may require to be made in, on or to the Premises. c) No sign, advertisement or notice shall be inscribed, painted or affixed by the Tenant, or any other person on the Tenant's behalf, on any part of the inside or outside of the Building unless the sign, advertisement or notice has been approved by the Landlord, such approval not to be unreasonably withheld, delayed or conditioned. d) All alterations and additions to the Premises made by or on behalf of the Tenant, other than the Tenant's Trade Fixtures, shall immediately become the property of the Landlord without compensation to the Tenant. e) The Tenant agrees, at its own expense and by whatever means may be necessary, immediately to obtain the release or discharge of any encumbrance that may be registered against the Landlord's property in connection with any additions or alterations to the Premises made by the Tenant or in connection with any other activity of the Tenant. t) If the Tenant has complied with its obligations according to the provisions of this Lease, the Tenant may remove its Trade Fixtures at the end of the Term or other termination of the Lease and the Tenant covenants that it will make good and repair or replace as necessary any damage caused to the Premises by the removal of the Tenant's Trade Fixtures. g) Other than as provided in paragraph 8(t) above, the Tenant shall not during the Term of this Lease or any time thereafter remove from the Premises any Trade Fixtures or other goods and chattels of the Tenant except in the following circumstances: (i) the removal is in the ordinary course of business; (ii) the Trade Fixture has become unnecessary for the Tenant's business or is being replaced by a new or similar Trade Fixture; or (iii) the Landlord has consented in writing to the removal. but in any case the Tenant shall make good any damage caused to the Premises by the installation or removal of any Trade Fixtures, equipment, partitions, furnishings and any other objects whatsoever brought onto the Premises by the Tenant. - 6 - h) The Tenant shall, at it own expense, if requested by the Landlord, remove any or all additions or improvements made by the Tenant to the Premises contrary to the provisions of this paragraph 8 during the Term and shall repair all damage caused by the installation or the removal or both. i) The Tenant shall not bring on to the Premises or any part of the Premises any machinery, equipment or any other thing that might, in the opinion of the Landlord, by reason of its weight, size or use, damage the Premises or overload the floors of the Premises and if the Premises are damaged or overloaded the Tenant shall restore the Premises immediately or pay to the Landlord the actual cost of restoring the Premises. 9. INSURANCE a) The Tenant covenants to keep the Landlord indemnified against all claims and demands whatsoever ("Claims") by any person, whether in respect of damage to person or property, arising out of or occasioned by the maintenance, use or occupancy of the Premises by the Tenant or the subletting or assignment of same or any part thereof except to the extent that such Claims arise directly or indirectly by the acts or omissions of the Landlord or persons for whom it is responsible in law. The Tenant further covenants to indemnify the Landlord with respect to any encumbrance on or damage to the Premises, the Building and the Common Facilities occasioned by or arising from the act, default, or negligence of the Tenant, its officers, agents, servants, employees, contractors, customers, invitees or licensees and the Tenant agrees that the foregoing indemnity shall survive the termination of this Lease notwithstanding any provisions of this Lease to the contrary for any Claim that may have arisen during the Term or any extension or renewal thereof. b) The Tenant shall carry insurance in its own name to provide coverage with respect to the risk of business interruption to an extent sufficient to allow the Tenant to meet its ongoing obligations to the Landlord and to protect the Tenant against loss of revenues. c) The Tenant shall carry insurance in its own name insuring against the risk of damage to the Tenant's property within the premises caused by fire or other perils and the policy shall provide for coverage on a replacement cost basis to protect the Tenant's stock-in-trade, equipment, Trade Fixtures, decorations and improvements. d) The Tenant shall, during the term of this lease, provide, at its own expense, and keep in full force and effect, in the names of the Landlord and the Tenant, public liability insurance applying to all operations ofthe Tenant and which shall include bodily injury liability and tenants' legal liability with respect to the occupancy by the Tenant of the Premises. Such policies shall be written on a comprehensive basis with limits of not less that ONE MILLION DOLLARS per occurrence and with a cross liability clause. All policies of insurance required to be maintained under this provision shall be with a company or companies licensed to do business within the Province of Ontario and approved by the Landlord. The Tenant shall furnish the Landlord with certificates or other acceptable evidence of all such insurance promptly upon request. e) During the Term, and any extension or renewal thereof, the Landlord shall procure, and pay for fire and extended coverage insurance insuring the Building in which the Premises are located for the full replacement value with an insurance company licenced to do business in the Province of Ontario. The Landlord hereby waives any and all rights of recovery against Tenant for any loss occurring to the Building not caused by the Tenant, its officers, agents, servants, employees, contractors, customers, invitees or licensees. The term "extended coverage" as used herein, shall mean such casualties as are commonly included under the term "extended coverage" as such term is known and used in the casualty insurance business. During the Term, and any extension or renewal thereof, the Landlord shall protect, indemnify and save harmless the Tenant from and against any and all liability to third parties incurred by any act or omission of the Landlord, or any - 7 - of its agents, servants, or employees, in, on, or about the Real Property or the Building not comprising the Premises, and shall purchase and maintain comprehensive general liability insurance, in the amount of not less than $1,000,000.00 combined single limit (bodily injury and property damage), and with property damage insurance in the amount determined by the Landlord. 10. DAMAGE TO THE PREMISES a) If the Premises or the Building in which the Premises are located, are damaged or destroyed, in whole or in part, by fire or other peril, then the following provisions shall apply: 1. If the damage or destruction renders the Premises unfit for occupancy and impossible to repair or rebuild using reasonable diligence within 120 clear days from the happening of such damage or destruction, then, at the Landlord's option and upon written notice to the Tenant by the Landlord, the Term hereby granted shall cease from the date the damage or destruction occurred, and the Tenant shall immediately surrender the remainder of the Term and give possession of the Premises to the Landlord, and the Rent shall abate from the happening of such damage or destruction until the time of the surrender and the Lease shall be terminated. 11. If the Premises can, with reasonable diligence, be repaired and rendered fit for occupancy within 120 days from the happening of the damage or destruction, but the damage renders the Premises wholly unfit for occupancy, then the Rent hereby reserved shall not accrue after the day that such damage occurred, or while the process of repair is going on, and the Landlord shall repair the Premises with all reasonable speed, and the Tenant's obligation to pay Rent shall resume immediately after the necessary repairs have been completed. 111. If the Premises can be repaired with 120 days as aforesaid, but the damage is such that the leased Premises are capable of being partially used, then until such damage has been repaired, the Tenant shall continue in possession and the Rent shall abate proportionately until such time as the entire Premises are capable of being used. b) Any question as to the degree of damage or destruction or the period of time required to repair or rebuild shall be determined by an independent and qualified architect retained by the Landlord. c) There shall be no abatement from or reduction of the Rent payable by the Tenant, nor shall the Tenant be entitled to claim against the Landlord for any damages, general or special, caused by fire, water, sprinkler systems, partial or temporary failure or stoppage of services or utilities which the Landlord is obliged to provide according to this Lease, from any cause whatsoever, unless due to the acts or omissions of the Landlord or of those for whom it is responsible at law. 11. ACTS OF DEFAULT AND LANDLORD'S REMEDIES a) An "Act of Default" has occurred when: 1. the Tenant has failed to pay Rent for a period of fifteen (15) consecutive days, after demand for payment has been made; 11. the Tenant has breached its covenants or failed to perform any of its obligations under this Lease; and a) the Landlord has given notice specifying the nature of the default and the steps required to correct it; and b) the Tenant has failed to take action to correct the default as reasonably required by the Landlord and specified in the notice; - 8 - 111. the Tenant has; A. become bankrupt or insolvent or made an assignment for the benefit of Creditors; B. had its property seized or attached in satisfaction of a judgment; C. had a receiver appointed; D. committed any act or neglected to do anything with the result that a Claim for Lien or other encumbrance is registered against the Real Property and the Tenant has not discharged or caused to be discharged such Claim for Lien within ten (10) days of receiving notice of the Claim for Lien; E. taken action, if the Tenant is a corporation, with a view to winding up, dissolution or liquidation; IV. any insurance policy required to be maintained by the Tenant is cancelled or not renewed by reason of the use or occupation of the Premises, or by reason of non-payment of premiums; v. the Premises are used by any other person or persons, or for any other purpose than as provided for in this Lease without the written consent of the Landlord. b) When an Act of Default on the part of the Tenant has occurred: 1. the current month's rent together with the next three months' rent shall become due and payable immediately; or 11. the Landlord shall have the right to terminate this Lease and to re-enter the Premises and deal with them as it may choose in accordance with all applicable laws. c) If, because an Act of Default has occurred, the Landlord exercises its right to terminate this Lease and re-enter the Premises prior to the end of the Term, the Tenant shall nevertheless be liable for payment of Rent and all other amounts payable by the Tenant in accordance with the provisions of this Lease until the Landlord has re-let the Premises or otherwise dealt with the Premises in such manner that the cessation of payments by the Tenant will not result in loss to the Landlord and the Tenant agrees to be liable to the Landlord, until the end of the Term of this Lease for payment of any difference between the amount of Rent hereby agreed to be paid for the Term hereby granted and the Rent any new tenant pays to the Landlord. d) The Tenant covenants that notwithstanding any present or future Act of the Legislature of the Province of Ontario, the personal property of the Tenant located at the Premises during the Term shall not be exempt from levy by distress for Rent in arrears; i) and the Tenant acknowledges that it is upon the express understanding that there should be no such exemption that this Lease is entered into, and by executing this Lease: A) the Tenant waives the benefit of any such legislative provisions which might otherwise be available to the Tenant in the absence of this agreement; and B) the Tenant agrees that the Landlord may plead this covenant as an estoppel against the Tenant if an action is brought to test the Landlord's right to levy distress against the Tenant's property. - 9 - e) If, when an act of Default has occurred, the Landlord chooses not to terminate the Lease and re-enter the Premises, the Landlord shall have the right to take any and all reasonably necessary steps to rectify any or all Acts of Default of the Tenant and to charge the actual costs of such rectification to the Tenant and to recover the actual costs as Rent. f) If, when an Act of Default has occurred, the Landlord chooses to waive its right to exercise the remedies available to him under this Lease or at law the waiver shall not constitute condonation of the Act of Default, nor shall the waiver be pleaded as an estoppel against the Landlord to prevent its exercising its remedies with respect to a subsequent Act of Default. g) No covenant, term, or condition of this Lease shall be deemed to have been waived by the Landlord unless the waiver is in writing and signed by the Landlord. 12. TERMINATION UPON NOTICE AND AT THE END OF TERM a) Ifthe Landlord desires at any time to demolish the Premises or any part thereof, to an extent that renders continued possession by the Tenant impracticable, or if the Premises are expropriated or condemned by any competent authority: i) The Landlord shall have the right to terminate this Lease by giving ninety (90) clear days' notice in writing to the Tenant; or ii) The Landlord may require the Tenant to vacate the premises within ninety (90) days from payment by the Landlord to the Tenant of a bonus equal to three months' rent, but payment of the said bonus shall be accompanied or preceded by written notice from the Landlord to the Tenant advising of the Landlord's intent to exercise this option b) The Tenant agrees to permit the Landlord during the last three months of the Term of this Lease to display "For Rent" or "For Sale" signs or both at the Premises and to show the Premises to prospective new tenants or purchasers and to permit anyone having written authority of the Landlord to view the Premises at reasonable hours upon twenty-four (24) hours prior notice to the Tenant. c) If the Tenant remains in possession of the Premises after termination of this Lease as aforesaid and if the Landlord then accepts rent for the Premises from the Tenant, it is agreed that such overholding by the Tenant and acceptance of Rent by the Landlord shall create a monthly tenancy only but the tenancy shall remain subject to all the terms and conditions of this Lease except those regarding the Term. 13. ACKNOWLEDGEMENT BY TENANT The Tenant agrees that it will at any time or times during the Term, upon being given at least five (5) business days prior written notice, execute and deliver to the Landlord a statement in writing certifying: a) that this Lease is unmodified and is in full force and effect (or if modified stating the modifications and confirming that the Lease is in full force and effect as modified); b) the amount of Rent being paid; c) the dates to which Rent has been paid; d) other charges payable under this Lease which have been paid; e) particulars of any prepayment of Rent or security deposits; and f) particular of any subtenancies. - 10- 14. SUBORDINATION AND POSTPONEMENT a) This Lease and all the rights of the Tenant under this Lease are subject and subordinate to any and all charges against the land, buildings or improvements of which the Premises form part, whether the charge is in the nature of a mortgage, trust deed, lien or any other form of charge arising from the financing or re- financing, including extensions or renewals, of the Landlord's interest in the property. b) Upon the request of the Landlord the Tenant will execute any form required to subordinate this Lease and the Tenant's right to any such charge, and will, if required, attorn to the holder of the charge. c) No subordination by the Tenant shall have the effect of permitting the holder of any charge to disturb the occupation and possession of the Premises by the Tenant as long as the Tenant performs its obligations under this Lease. 15. RULES AND REGULATIONS The Tenant agrees on behalf of itself and all persons entering the Building with the Tenant's authority or permission to comply with all reasonable rules and regulations that form part of this Lease or that the Landlord may make from time to time for the safety, care and cleanliness of the Building and the preservation of good order in the Building and Common Facilities. 16. NOTICE a) Any notice required or permitted to be given by one party to the other pursuant to the terms of this Lease may be given. to the Landlord at: 1475 5th Concession RR#5 Kincardine, Ontario N2Z 2X6 Facsimile No.: 519-396-8288 to the Tenant at the Premises or at: Bruce Power P.O. Box 1540, BI0 177 Tie Rd., Municipality of Kincardine R.R #2 Tiverton, ON NOG 2TO Attention: Bruce Little, Emergency Measures Facsimile No.: (519) 361-4559 with a copy to: Bruce Power P.O. Box 1540, BlO 6th Floor 177 Tie Rd., Municipality of Kincardine RR #2 Tiverton, ON NOG 2TO Attention: Executive Vice President and General Counsel Facsimile No.: (519) 361-4333 b) The above addresses may be changed at any time by giving ten (10) days written notice. - 11 - c) Any notice given by one party to the other in accordance with the provision of this Lease shall be deemed conclusively to have been received on the next business day following the date delivered if the notice is served personally or by facsimile transmission or seventy-two (72) hours after mailing if the notice is mailed. 17. REGISTRATION The Tenant shall not at any time register notice of or a copy of this Lease on title to the Property of which the Premises form part without consent of the Landlord. 18. INTERPRETATION a) The words importing the singular number only shall include the plural, and vice versa, and words importing the masculine gender shall include the feminine gender, and words importing persons shall include firms and corporations and VIce versa. b) Unless the context otherwise requires, the word "Landlord" and the word "Tenant" wherever used herein shall be construed to include the executors, administrators, successors and assigns ofthe Landlord and Tenant, respectively. c) When there are two or more Tenants bound by the same covenants herein contained, their obligations shall be joint and several. 19. OPTIONS TO RENEW a) Provided the Tenant is not then in default of its covenants and obligations hereunder (beyond any period provided to cure such default), the Tenant shall have the option of renewing this lease for three (3 additional and successive periods of one (1) year each (individually, "Renewal Period") by giving notice to the Landlord, in the case of the first Renewal Period, on or before the 18t day of April, 2008 and, for any successive Renewal Period on the 18t day of April of the prior Renewal Period, as the case may be. All such renewals shall be on the same terms and conditions set out herein save and except with respect to the annual rent which shall be calculated as follows: i) Rent payable during the Term, or prior Renewal Period, as the case may be plus ii) the increase, if any, in the Tenant's proportionate share of (A) the Annual Operating Costs; and (B) the Property Taxes for the calendar year ending during the Term or prior Renewal Period, as the case may be over the previous calendar year. (b) For the purposes of this Lease: (i) "Annual Operating Costs" for a particular calendar year means the total, without duplication, of all expenses, fees, rentals, costs and disbursements of each nature and kind paid or incurred by or on behalf of the Landlord for such year in the maintenance, repair, operation and management of the Building and, without limitation, includes: - 12- (A) the total annual net costs and expenses of insuring the lands, buildings, improvements and equipment and other property in the Building from time to time owned or operated by the Landlord or for which the Landlord is legally responsible, in such manner and form, with such companies and such coverages and in such amounts as the Landlord from time to time determines in accordance with the Landlord's covenant to insure; (B) cleaning, snow removal, garbage and waste collection and disposal; (C) lighting, electricity and public utilities used in or serving the Building; (D) policing, security, supervision and traffic control; (E) salaries and benefits of personnel to the extent that the personnel are employed to carry out the maintenance and operation of the Building or the cost of all independent contractors engaged in performing any of the above activities; (F) the cost of the rental of any equipment and signs, and the cost of supplies used by the Landlord in the operation, maintenance and repair of the Building; (G) all repairs (including major repairs) and replacements to and maintenance and operation, including servicing and inspection costs, of the Building, and the systems, facilities and equipment serving the Building (including, without limitation, the elevator and alarm systems) except for the cost of repairing or replacing any inherent structural defects or weaknesses. (ii) "Property Taxes" means the assessment of the leased space in the Building multiplied by the tax rate for the commercial property class. (iii) "Tenant's proportionate share" (A) in the case of Property Taxes means the proportion of the Property Taxes which the assessment of the Premises is of the sum of the assessments of all the leased premises within the Building, and (B) in the case of any other amount provided for in this Lease, means 0.07 (being the proportion of the amount which the total leased area of the Premises is of the total leasable area of the Building as if the Building were entirely occupied by tenants). - 13 - 20. LANDLORD TO ACT REASONABLY In making a determination, designation, calculation, estimate, conversion, or allocation or in granting any consent or approval under this Lease, the Landlord will act reasonably and in good faith, subject to the specific provisions of this Lease. The Landlord covenants and agrees that each accountant, architect, engineer, surveyor or other professional employed or retained by the Landlord for the purposes of any determination, designation, calculation, estimate, conversion, or allocation required hereunder shall act in accordance with the applicable principles and standards of such person's profession. 21. COUNTERPART AND FACSIMILE TRANSMISSION This Lease may be executed in counterparts, and such counterparts together shall constitute one and the same agreement. Any executed counterpart of this Lease may be delivered to the other party by facsimile transmission and such facsimile counterpart shall be binding as if such party had delivered an originally executed counterpart. IN WITNESS WHEREOF the Landlord and the Tenant have executed this Lease. BRUCE POWER L.P. by its General PJrRVt4~~ Name: D~t Willett Title: Executive Vice President, Corporate Services t,.L A ^-~-'l Name: Brian Armstrong Title: Executive Vice President and General Counsel . s- ~ ~~ e\~<~_;t/ Wame: John deRosenroll Title: Chief Administrative Officer I/we have authority to bind the corporation I/we have authority to bind the corporation BRUCE POWER LAW DMSION Approved: ~ Date: .~ 1 ~ 101 -14 - SCHEDULE "A" To Lease made between TIlE CORPORATION OF TIlE MUNICIPALITY OF KINCARDINE and BRUCE POWER INC. as general partner for and on behalf of BRUCE POWER L.P. Premises as double crosshatched below - the area to be leased totaling 1594 square feet. , ~ . ----. MClli:Unifll;ll J f7' rr I fr .1lS- I IZ' 'S" , Il' .l'r f. . .J,~ . I . -" !i' 'c Ill'" 11 ClI :a -. . [ . !~ ::~~l/ic.;", ~-HCfJiI. -' I.V."'" I . /!Drf, ,.~ ,. . ... ,~ ".- ~ I -j .. I IT_ ... I iN' I 12'.... : Ma2:2::<)nlna SCALE: I/tS"::o " .' -. NlpJlb~tsj"_tci~1 tltno(uqu( Jd,~ ~l;JI,r"r. hI.tror., l:;lOmrm'ltl o,eG OIl sc: l(inrrll'rf"i(.:i-: 'o.irnnr~ Rllilrlinn ?nrl r:l()()/, .~ ICirdrfllC IG ~ r ::t=; - 15 - SCHEDULE "B" To Lease made between THE CORPORATION OF THE MUNICIPALITY OF KINCARDINE and BRUCE POWER INC. as general partner for and on behalf of BRUCE POWER L.P. None - 16 - SCHEDULE "C" RULES AND REGULATIONS FORMING PART OF THIS LEASE The Tenant shall observe the following Rules and Regulations (as amended, modified or supplemented from time to time by the Landlord as provided in this Lease): 1. The sidewalks, entrances, elevators, stairways and corridors of the Building shall not be obstructed or used by the Tenant, its agents, servants, contractors, invitees or employees for any purpose other than access to and from the Premises. 2. The floors, sky-lights and windows that reflect or admit light into passageways or into any place in the Building shall not be covered or obstructed by the Tenant, and no awnings shall be put over any window. 3. The toilets, sinks, drains, washrooms and other water apparatus shall not be used for any purpose other than those for which they were constructed, and no sweepings, rubbish, rags ashes or other substances, such as chemicals, solvents, noxious liquids or pollutants shall be thrown therein, and any damage resulting to them from misuse shall be borne by the Tenant by whom or by whose employees, agents, servants, contractors or Invitees the damage was caused. 4. In the event that the Landlord provides and installs a Public Directory Board inside the Building, the Tenant's name, at the Tenants written request, shall be placed on the said Public Directory Board at the expense ofthe Tenant. 5. No animals or birds shall be brought into the Building or kept on the Premises. 6. Save and except in connection with any alterations or additions approved in accordance with the terms and provisions ofthe Lease, the Tenant shall not mark, drill into, bore or cut or in any way damage or deface the walls, ceilings or floors of the Premises. No wires, pipes or conduits shall be installed in the Premises without prior written approval of the Landlord. No broadloom or carpeting shall be affixed to the Premises by means of a non-soluble adhesive or similar products. Landlord acknowledges that Tenant will be installing a satellite dish and allows the necessary drillings etc. required to accommodate this installation. 7. No one shall use the Premises for sleeping apartments or residential purposes, for the storage of personal effects or articles other than those required for business purposes, or for any illegal purpose. 8. The Tenant shall not use or permit the use of any objectionable advertising medium such as, without limitation, loudspeakers, public address systems, sound amplifiers, radio, broadcast or television apparatus within the Building which is in any manner audible or visible outside ofthe Premises. 9. The Tenant must observe strict care not to allow windows to remain open so as to admit rain or snow, or so as to interfere with the heating of the Building. The Tenant neglecting this rule will be responsible for any damage caused to the property of other tenants, or to the property of the Landlord, by such carelessness. The Tenant, when closing the Premises, shall close all windows and lock all doors. 10. The Tenant shall not without the express written consent of the Landlord, place any additional locks upon any doors of the Premises and shall not permit any duplicate keys to be made therefor; but shall use only additional keys obtained from the Landlord, at the expense of the Tenant, and shall surrender to the Landlord on the termination of the Lease all keys of the Premises. 11. No inflammable oils or other inflammable, toxic, dangerous or explosive materials shall be kept or permitted to be kept in or on the Premises. 12. No bicycles or other vehicles shall be brought within the Premises or upon the Landlord's property, including any lane or courtyard, unless otherwise agreed in writing. - 17 - 13. Nothing shall be placed on the outside of windows or projections of the Premises without the consent of the Landlord. No air-conditioning equipment shall be placed at the windows of the Premises without the consent in writing of the Landlord. 14. The moving of all heavy equipment and office equipment or furniture shall occur only between 6:00 p.m. and 8:00 a.m. or any other time consented to by the Landlord and the persons employed to move the same in and out of the Building must be acceptable to the Landlord. Safes and other heavy equipment shall be moved through the Premises and common areas only upon steel bearing plates. No deliveries requiring the use of an elevator for freight purposes will be received into the Building or carried in the elevators, except during hours approved by the Landlord. 15. Canvassing, soliciting and peddling in the Building is prohibited. 16. The Tenant shall first obtain in writing the consent of the Landlord to any alteration or modification to the electrical system in the Premises and all such alterations and modifications shall be completed at the Tenant's expense by an electrical contractor acceptable to the Landlord. 17. The Tenant shall first obtain in writing the consent of the Landlord to the placement by the Tenant of any garbage containers or receptacles outside the Premises or Building. 18. The Tenant shall not install or erect on or about the Premises television antennae, communications towers, satellite dishes or other such apparatus, without consent of the Landlord. 19. The Landlord shall have the right to make such other and further reasonable rules and regulations and to alter, amend or cancel all rules and regulations as in its judgement may from time to time be needed for the safety, care and cleanliness of the Building and for the preservation of good order therein and the same shall be kept and observed by the Tenant, its employees, agents, servants, contractors or Invitees. The Landlord may from time to time waive any of such rules and regulations as applied to particular tenants and is not liable to the Tenant for breaches thereof by other tenants.