WAREHOUSE LEASE AGREEMENT

1.1.

ADDITIONAL RENT

“Additional Rent” means payments which the Tenant is required to make to the Landlord pursuant to this Lease in addition to Gross Rent.

1.2.

ADDITIONAL SERVICES

“Additional Services” means the services and supervision supplied by the Landlord from time to time to the Tenant and which are additional to the normal operation and maintenance of the Property and other services which the Landlord has agreed to supply pursuant to the provisions of this Lease and to like provisions of other leases within the Group of Buildings (defined below). For such Additional Services the Tenant shall pay a reasonable charge together with a fifteen percent (15%) service fee to the Landlord or his assigns. Any disputes shall be settled conclusively by the Landlord’s independent chartered accountant.

1.3.

BUILDING, GROUP OF BUILDINGS AND SUB-GROUP OF BUILDINGS

“Building” means the building and related improvements in which the Premises are located, which Building is outlined in red on the plan attached to this agreement as Schedule “B”;

“Group of Buildings” means all buildings or related improvements now or hereafter built upon the Lands such buildings presently as shown on the plan attached to this agreement as Schedule “B”;

“Sub-group of Buildings” means buildings or related improvements within the Group of Buildings as designated by the Landlord from time to time as separate from other buildings in the Group of Buildings for the purposes of calculating Operating Costs (defined below) for that Sub-group of Buildings chargeable to the Tenant as Additional Rent.

1.4.

COMMON AREAS

“Common Areas” means all areas of the Property, as may be designated by the Landlord from time to time, including without limitation, corridors, electrical rooms, and other facilities for the use of all tenants.

1.5.

INSURED DAMAGE

“Insured Damage” means the part of any damage occurring to the Premises for which the Landlord is responsible of which the cost of repair is actually recoverable by the

Landlord under a policy of insurance in respect of fire and other perils from time to time effected by the Landlord.

1.6.

LANDS

“Lands” means those lands described in Schedule “A” to this Agreement

1.7.

LANDLORD’S ARCHITECT

“Landlord’s Architect” means the independent architect, or engineer or quantity surveyor selected by the Landlord from time to time for the purposes of making determinations hereunder.

1.8.

LEASE

“Lease”, “hereof”, “herein”, “hereunder” and similar expressions mean or refer to this Lease and includes all other Schedules attached hereto, and any amendments thereof made from time to time by the parties in writing.

1.9.

LEASEHOLD IMPROVEMENTS

“Leasehold Improvements’ means all fixtures, improvements, installations, alterations and additions from time to time made, erected or installed by or on behalf of the Tenant or any previous tenant of the Premises with the exception of trade fixtures or furniture and equipment not of the nature of fixtures, and includes all wall-to-wall carpeting (whether or not supplied by the Landlord), and all window coverings.

1.10.

NORMAL BUSINESS HOURS

“Normal Business Hours” means the hours from 8:00 am. to 6:00 p.m., Monday to Friday, inclusive, and 8:00 a.m. to 1:00 p.m. Saturday of each week, statutory holidays excepted.

1.11.

PREMISES

“Premises” means that portion of the main floor Building shown outlined in red on the Plan attached to this agreement as Schedule “C” hereto. The exterior face of the Building is expressly excluded from the Premises and reserved to the Landlord.

1.12.

PRIME RATE

“Prime Rate” means that rate of interest announced from time to time by the main branch in the city in which the Building us situate, of the Toronto-Dominion Bank, as a reference rate then in effect for determining interest rates on Canadian Dollar denominated commercial loans made in Canada,

1.13.

PROPERTY

“Property” means the Lands and Group of Buildings referred to herein and all other improvements on the Lands as arc from time to time existing thereon.

1.14.

PROPORTIONATE SHARE

“Proportionate Share” means the percentage of the Tenant’s Rentable Area within the total rentable area of the Building.

1.15.

RENT

“Rent” means the Gross Rent and the Additional Rent.

1.16.

RENTABLE AREA

“Rentable Area” as further defined herein shall refer to all floor area measured irons the predominant building wall in the case of exterior walls (without deduction for vestibules, entrances or other recessed areas inside the building line) and to the centre of partitions that separate the Premises from adjoining premises or Common Areas (without deduction for columns, ducts, projections or other structural elements necessary to the Building), to which shall be added a pro rata share of the Common Areas as defined above within the Building in which the Rentable Area is located.

1.17.

TERM

“Term” means the term of the Lease set forth in Article 3.1 and any extension thereof and any period of permitted overholding

2.1.

PREMISES

The Rentable Area of the Premises known as Main Floor, 2955 Hebb Street, Vancouver, B.C. is approximately thirty two thousand four hundred (32,400) square feet subject to final determination by the Landlord’s Architect. the measurement prepared by the Landlord’s Architect shall be final and binding upon the parties hereto as to such Rentable Area.

2.2.

INTENT

The Landlord and the Tenant acknowledges and agrees that this Lease shall be a completely gross lease for the Tenant except as expressly herein set out and the Tenant shall not be responsible during the Term hereof for any costs, charges, expenses and outlays of any nature whatsoever arising from or relating to the Premises, or the contents thereof, except as expressly herein set out, and without limiting the generality of the foregoing, the Landlord shall be liable for the payment of all charges, impositions and

expenses of every nature and kind relating to the Premises and the contents thereof; except as expressly herein set out including Operating Costs and Taxes as defined herein.

3.1.

TERM

The Term of this Lease shall be for three (3) years and shall commence on the 1st day of February, 2005 (the “Commencement Date.”) In the event the Premises should not be ready for occupancy by Commencement Date for any reason, the Commencement Date shall remain that as aforesaid, however the Landlord may extend the date of delivery and in such a case agrees to credit Rent to the Tenant calculated on a per diem basis for each day that the Tenant is not in occupation until the date that the Premises are ready for occupation, the Tenant begins Leasehold Improvements or otherwise occupies the Premises. The Landlord shall not be liable or responsible for any claims, damages or liabilities in connection therewith or by reason thereof.

4.1.

SECURITY DEPOSIT

Prior to or concurrently with the execution and return of this Lease by the Tenant, the Tenant shall pay to the Landlord’s agent Bentall Real Estate Services Limited Partnership the sum of Forty Three Thousand Three hundred Thirty Five Dollars ($43,335.00) as a deposit. The deposit is comprised of the first month’s Gross Rent plus goods and services tax being Twenty One Thousand Six Hundred Sixty Seven Dollars and Fifty Cents ($21,667.50) and Twenty One Thousand Six Hundred Sixty Seven Dollars and Fifty Cents ($21,667.50) as a further deposit to the Landlord to stand as security for the payment by Tenant of any and all present and future debts and liabilities of the Tenant to the Landlord in connection with its obligations arising under this Lease for the term of the Lease (the “Debts, Liabilities and Obligations”). The agent of the Landlord is hereby authorized by the Tenant to deliver such deposit to the Landlord and need not hold it in trust as stakeholder. The Landlord shall not be required to keep the deposit separate from its general funds. In the event the Landlord shall from time to time apply any or all of such deposit towards payment of the Debts, Liabilities and Obligations, the Tenant shall, from time to time at the request of the Landlord, forthwith pay to the Landlord such sum to bring the amount of the said deposit up to its original amount. In the event of the Landlord disposing of its interest in this Lease, the Landlord shall credit the deposit to its successor and thereupon shall have no liability to the Tenant to repay the security deposit to the Tenant. If the Tenant shall from time to time fail to observe, perform and pay its Debts, Liabilities and Obligations in accordance with the terms of this Lease, the Tenant hereby authorizes the landlord to apply all or part, as the case may be of such security deposit to rectify such failure. Subject to the foregoing and to the Tenant not being in default under this Lease, the Landlord shall repay the security deposit to the Tenant without interest within ninety (90) days at the end of the Term or sooner termination of

the Lease provided that all Debts, Liabilities and Obligations of the Tenant to the Landlord are paid and performed in full, failing which the Landlord may, on notice to the Tenant, elect to retain the security deposit and to apply it in reduction of the Debts, Liabilities and Obligations and the Tenant shall remain fully liable to the Landlord for payment and performance of the remaining Debts, Liabilities and Obligations. Notwithstanding the foregoing, if the Tenant fails to execute and deliver this Lease, in a mutually agreeable form, within ten (10) days of receipt from the Landlord or fails to take possession of the Premises by the Commencement Date, the Landlord may, at its sole option, terminate this Lease, whereupon the deposit shall be retained by the Landlord as liquidated damages on account of the Tenant’s default and not as a penalty.

The deposit includes goods and services tax of seven percent (7%).

4.2.

GROSS RENT

From and after Commencement Date, the Tenant shall pay a gross annual rent (herein called “Gross Rent”) in the sum of two hundred forty three thousand dollars ($243,000.00) per year calculated on the basis of seven dollars and fifty cents ($7.50) per square foot of Rentable Area of the Premises per annum. Such Gross Rent, together with any adjustment of rent provided for herein then in effect, shall be due and payable in twelve (12) equal installments on the first day of each calendar month during the initial Term of this Lease and any extensions or renewals thereof, and the Tenant hereby agrees to so pay such Gross Rent to the Landlord at the Landlord’s address as provided herein (or such other address as may be designated by the Landlord from time to time) monthly in advance without demand. If the Term of this Lease as heretofore established commences on other than the first day of a month or terminates on other than the last day of a month, then the installment or installments so prorated shall be paid in advance. Goods and services tax of seven percent (7%) shall be added to any Gross Rent amounts payable.

4.3.

ADDITIONAL RENT

From and after Commencement Date, the Tenant shall pay as Additional Rent the costs of janitorial and garbage services and all utilities consumed within the Premises, including electricity, gas and water and all other sums to be paid by the Tenant hereunder, and the Landlord shall have the same remedies for default for the payment of Additional Rent as are available to the Landlord in the case of default in the payment of Gross Rent. All Additional Rent amounts shall include goods and services tax of seven percent (7%).

It is agreed between the Landlord and the Tenant that the electricity utility consumption will not be separately metered. It is further agreed between the Landlord and the Tenant that the Tenant’s electricity consumption will be calculated on the basis of the fixture and plug load count multiplied by the hours of operation multiplied by the prevailing market rate of cost per kilowatt hour, which prevailing market rate may change from time to time. Such total amount will be averaged on an annual basis and charged monthly.

To measure gas and water consumed within the Premises, the Landlord shall install at its expense a separate meter. The Tenant shall pay directly to the Landlord, as invoiced, all amounts associated with the gas and water consumed within the Premises.

4.4.

DIRECT ASSESSMENT

The Tenant covenants to pay promptly when billed, all taxes, rates, duties or charges levied imposed or assessed on its personal property, its use or occupation of the Premises, the business carried on therein, all fixtures, equipment, machinery of the Tenant therein or from time to time levied, imposed or assessed in the future in lieu thereof; and Taxes levied, imposed or assessed on all Leasehold Improvements in the Premises.

4.5.

LANDLORD TAX OBLIGATION

The Landlord covenants with the Tenant, subject to the provisions of Articles 4.3 and 4.7 to pay the Taxes promptly when due. The Landlord shall have the right to appeal any taxes assessed or levied against the Property or the Premises but shall not be obligated to so do.

4.6.

AMOUNTS PAST DUE

If the Tenant fails to pay, when the same is due and payable, any Gross Rent, any Additional Rent or any other amounts payable by the Tenant under this Lease, such unpaid amounts shall bear interest from the due date thereof to the date of payment at a rate per annum which is six (6) percentage points above the Prime Rate.

4.7.

GST, SALES TAX AND VALUE-ADDED TAX

Notwithstanding anything herein contained to the contrary, the Tenant shall pay to the Landlord an amount equal to any and all goods and services taxes, sales taxes, value-added taxes, business transfer taxes, or any other taxes imposed on the Landlord with respect to Rent payable by the Tenant to the Landlord under this Lease, or in respect of the rental of space under this Lease, whether characterized as a goods and services tax, sales tax, value-added tax, business transfer tax, or otherwise (herein called “Sales Tax”), it being the intention of the parties that Landlord shall be fully reimbursed by the Tenant with respect to any and all Sales Tax at the full tax rate applicable from time to time in respect of the Rent or the rental of space, without reference to any tax credits available to the Landlord. The amount of the Sales Tax so payable by the Tenant shall be calculated by the Landlord in accordance with the applicable legislation and shall be paid to the Landlord at the same time as the amounts to which such Sales Tax apply are payable to the Landlord under the terms of this Lease or upon demand at such other time or times as the Landlord from time to time determines. Despite any other section or clause in this Lease, the amount payable by the Tenant under this paragraph shall be deemed not to be Rent, but the Landlord shall have all of the same remedies for and recovery of such amount as it has for recovery of Gross Rent under this Lease.

4.8.

WAIVER OF CLAIM AND SETOFF

The Tenant hereby waives and renounces any and all existing and future claim, counterclaims, setoffs and compensation against any Rent and agrees to pay such Rent regardless of any claim, setoff or compensation which may be asserted by the Tenant or on its behalf.

4.9.

RECEIPTS, ETC.

Whenever requested by the Landlord the Tenant shall deliver to it receipts for payments of all taxes, rates, duties, levies and assessments payable by the Tenant pursuant to Section 4.7(a) hereof and furnish such other information in connection therewith as the Landlord may reasonably require.

5.1.

OCCUPANCY

From the date that the Premises are ready for occupation, and throughout the Term to continuously occupy the Premises and to carry on therein the business comprising the Permitted Use subject to the terms herein.

5.2.

RENT

To pay the Rent hereby reserved, and all other sums payable hereunder to the Landlord, promptly on the days and at the times and in the manner specified herein, without demand, deduction or set-off.

5.3.

PERMITTED USE

To use the Premises only for the purpose of storing and the distribution of clothing, fabric and store fixtures, and not to use or permit to be used the Premises or any part thereof for any other purpose or business whatsoever without the written consent of the Landlord.

Notwithstanding anything to the contrary herein contained, but subject to the Tenant:

5.4.

WORK AND NUISANCE

Not to commit or permit any waste or damage to the Premises including the Leasehold Improvements and trade fixtures therein, any nuisance therein or any use or manner of use causing annoyance to other tenants and occupants of the Group of Buildings and not to use or permit to be used any part of the Premises for any trade or business which is, in the opinion of the Landlord, dangerous, noxious or offensive; not cause or suffer or permit any oil or grease or any harmful, objectionable, dangerous, poisonous or explosive matter or substance to be discharged into the Premises or the Property; and not to place any objects on or otherwise howsoever obstruct the heating or air conditioning vents within the Premises.

5.5.

FLOOR LOADS

Not to place a load upon any portion of any floor of the Premises which exceeds the floor load which the area of such floor being loaded was designed to carry having regard to the loading of adjacent areas and that which is allowed by code. The Landlord reserves the right to prescribe the weight and position of all safes and heavy installation which the Tenant wishes to place in the Premises, so as to distribute properly the weight thereof and the Tenant shall pay for all costs incurred by the Landlord and the Landlord’s Architect in making such assessment. The Tenant shall repair any damage done in the Premises or the Building by reason of any excessive weight placed in the Premises or excessive vibration caused in the Premises.

5.6.

INSURANCE RISKS

Not to do, omit to do or permit to be done upon the Premises anything which would or might cause Landlord’s cost of insurance (whether fire, liability or other) to be increased (and, without waiving the foregoing prohibition the Landlord may demand, and the Tenant shall pay to the Landlord upon demand, the amount of any such increase of cost caused by anything so done or omitted or permitted to be done or omitted) or which would or might cause any policy of insurance to be subject to cancellation or refusal of placement or renewal.

5.7.

NOXIOUS FUMES, ODORS AND ENVIRONMENTAL MATTERS

To use the Premises so that noxious or objectionable fumes, vapors and odors will not occur beyond the extent to which they are discharged or eliminated by means of the flues and other devices provided in the Building by the Landlord and shall prevent any such noxious or objectionable fumes, vapors and odors from entering into the air conditioning or being discharged into other vents or flues of the Building or annoying any of the tenants in the Building. Any discharge of fumes, vapors and odors shall be permitted only during such period or periods, to such extent, in such conditions and in such manner as directed by the Landlord from time to time.

The Tenant covenants with the Landlord that it will not bring upon, permit or use any substance, defined or designated as a hazardous or toxic waste, hazardous or toxic material, a hazardous, toxic or radioactive substance or other similar term, by any applicable federal, provincial, municipal or local statute, regulation, by-law or ordinance now or hereafter in effect, or any substance or materials, the use or disposition of which is regulated by any such statute, regulation, by-law or ordinance (hereinafter called “Toxic Materials”) in, on or under the Premises or Property and the Tenant will promptly comply with all statutes, regulations, by-laws and ordinances, and with all orders, decrees or judgments of governmental authorities or courts having jurisdiction, relating to the use, collection, storage, treatment, control, removal or cleanup of Toxic Materials in, on, or tinder the Premises or Property if the Premises or Property become contaminated with Toxic Materials as a result of operations or activities on the Premises or Property, or incorporated in any improvements thereon.

The Landlord may, but shall not be obliged to, enter upon the Premises and the Property and take such actions and incur such costs and expenses to effect such compliance as it deems advisable and the Tenant shall reimburse the Landlord on demand for the fill amount of all costs and expenses incurred by the Landlord in connection with such compliance activities. The Tenant will indemnify and hold the Landlord harmless against any and all losses, damages, costs, expenses and liabilities suffered or incurred by the Landlord by reason of a breach of any of the representations, warranties and covenants aforesaid which indemnity shall survive any release or discharge of this Lease.

The Landlord represents and warrants to the Tenant, with the intent that such representation and warranty is true as of the date the Offer to Lease was executed by the Landlord, being October 4, 2004, to the best of the Landlord’s knowledge and information, the Building does not contain any Toxic Materials. If, notwithstanding the foregoing, it is discovered that the Building contains Toxic Materials, and that the same were not brought thereon by the Tenant or those for whom the Tenant is in law responsible, then notwithstanding anything to the contrary contained herein the Landlord shall be responsible for removal and disposal of the same, such removal and disposal to be performed in conformity with all applicable statutes, regulations, by-laws and ordinances, and with all orders, decrees or judgments of governmental authorities or courts having jurisdiction, and at no cost to the Tenant.

5.8.

CONDITION

Not to permit, in the opinion of the Landlord, the Premises to become untidy, unsightly, offensive or hazardous or permit unreasonable quantities of waste or refuse to accumulate therein. The Tenant shall store all such garbage, refuse or other objectionable material (including commercial garbage containers) outside the Premises in a neat and orderly fashion and dispose of such garbage on a regular basis.

5.9.

BY-LAWS

To comply at its own expense with all municipal, federal, provincial, sanitary, fire, building and safety statutes, laws, by-laws, regulations, ordinances, orders and

requirements pertaining to the operation and use of the Premises, the condition of the Leasehold Improvements, trade fixtures, furniture and equipment. installed by the Tenant therein and the making by the Tenant of any repairs, changes or improvements therein or any other matter pertaining to the Premises or the Tenant as well as all rules and regulations of the Canadian Board of Fire Underwriters, or any successor body and with the requirements of all insurance companies having policies of any kind whatsoever in effect covering the Building which are communicated to the Tenant.

5.10.

RULES AND REGULATIONS

To observe, and to cause its employees, invitees and all others over whom the Tenant can reasonably be expected to exercise control to observe the Rules and Regulations attached as Schedule “D” hereto, and such further and other reasonable Rules and Regulations and amendments and changes therein as may hereafter be made by the Landlord of which notice in writing shall be given to the Tenant and all such Rules and Regulations shall be deemed to be incorporated into and form part of this Lease. For the enforcement of such Rules and Regulations, the Landlord shall have available to it all remedies in this Lease provided for a breach thereof and all legal remedies whether or not provided for in this Lease, both at law and in equity. The Landlord shall not be responsible or liable to the Tenant for the non-observance or violation by any other tenant of any such Rules and Regulations or the non-enforcement as against other tenants of such Rules and Regulations or any loss or damage arising out of the same,

5.11.

SURRENDER, OVERHOLDING

That upon the expiration or other termination of the Term of this Lease, the Tenant shall quit and surrender the Premises in vacant and clean possession and in good order, repair, decoration, and condition (subject to the exceptions to the Tenant’s repair obligations contained in Article 8.2(a) hereof) and shall remove all its property therefrom, except as otherwise provided in this Lease. The Tenant’s obligation to observe or perform this covenant shall survive the expiration or other termination of the Term of this Lease. If the Tenant shall continue to occupy the Premises after the expiration of this Lease without further written agreement and without objection by the Landlord, the Tenant shall be a month-to-month tenant at double the Gross Rent provided for herein (plus Additional Rent) and (except as to length of tenancy) on and subject to the provisions and conditions herein set out.

5.12.

SIGNS AND ADVERTISING

The Tenant shall be entitled to be included on the lobby directory signage and may install identification signage on the door to the Premises.

The design and lettering of such sign on the door of the Premises and the manner and timing of the installation thereof shall comply with the Landlord’s signage policy for the Building and shall be subject to the Landlord’s approval. On the expiration or sooner termination of the Term, such sign or signs shall be removed by the Tenant at its sole cost, risk and expense and any damage caused by such removal shall forthwith be

repaired by the Tenant. Except as aforesaid, the Tenant shall not paint, display, inscribe, place or affix any other sign, symbol, notice or lettering of any kind anywhere outside the Premises (whether on the outside or inside of the Building) or within the Premises so as to be visible from the outside of the Premises.

5.13.

INSPECTION AND ACCESS

To permit the Landlord at any time and from time to time to enter and to have its authorized agents, employees and contractors enter the Premises for the purpose of (i) inspection, maintenance, making repairs, alterations or improvements to the Premises, adjoining premises or the Building, or to have access to or make changes in utilities and services (including underfloor and overhead ducts, air conditioning, heating, plumbing, electrical and telephone facilities and access panels, all of which the Tenant agrees not to obstruct) and (ii) to determine the electric light and power consumption by the Tenant in the Premises and the Tenant shall provide free and unhampered access for such purposes, and shall not be entitled to compensation for any inconvenience, nuisance and discomfort or loss caused thereby, but the Landlord in exercising its rights hereunder shall proceed to the extent reasonably possible so as to minimize interference with the Tenant’s use and enjoyment of the Premises.

5.14.

EXHIBITING PREMISES

To allow the Landlord or its agents acting reasonably to enter and exhibit the Premises to prospective tenants or purchasers of the Property or part thereof, the Building or the Premises during Normal Business Hours during the Term hereof, and place upon the Premises a notice of reasonable dimensions and reasonably placed stating that said Property or the Premises are for sale or for let, which notice the Tenant shall not remove or obscure or permit to be removed or obscured.

5.15.

NAME OF BUILDING

Not to refer to the Building by any name other than that designated from time to time by the Landlord, nor to use such name for any purpose other than that of the business address of the Tenant.

5.16.

ACCEPTANCE OF PREMISES

To examine the Premises before taking possession and the taking of possession shall be conclusive evidence as against the Tenant that at the time thereof the Premises were in good order and satisfactory condition and that all alterations, remodeling, decorating and installation of equipment and fixtures required to be done by the Landlord have been satisfactorily completed save only for such list in writing prepared by the Tenant during a joint inspection by the Landlord and Tenant at the time of taking such possession. Any dispute as to any aspects of the Landlord’s Work or completion or adequacy of the Building, the Premises or any part thereof shall be determined by the Landlord’s Architect.

5.17.

NO AUCTION

The Tenant shall not at any time during the Term of this Lease, permit any sale by auction to be held within the Premises or upon the Property or any part thereof.

5.18.

YARD, ENTRANCE, STAIRWAYS, PLATFORM, LOADING DOCK AND PARKING OBSTRUCTION

The Tenant shall, at its own expense, keep all entrance ways and all steps and platforms, including loading docks, thereto clear of all snow, ice and debris. In the event that the Tenant fails to clear such areas resulting in claim of injury or other damages to third parties, other tenants or customers, such Tenant indemnifies and saves the Landlord harmless for any such claim or damages.

The Tenant shall not place, nor suffer or permit its customers, invitees, licensees, agents or servants to place any materials, including trucks, trailers, inventory, supplies, containers or other storage devises, and debris of any kind (“Materials”), in the yard or yards of the Property or the driveways, parking or Common Areas thereof and shall cause no obstruction to vehicles operating on the said driveways, loading bays, parking or Common Areas.

Trucks, Trailers, containers and other storage devices shall not be used for additional storage facilities for the Tenant in the Common Areas, driveways, parking, loading or yard areas. Loading areas are strictly for loading and unloading only. Any Materials deemed by the Landlord to be obstructing the above mentioned areas shall be removed by the Landlord at the Tenant’s sole expense. Prior to the removal of such Materials, the Landlord shall give the Tenant twenty-four hours notice of the obstruction. In the event that Materials are in the sole discretion of the Landlord obstructing an emergency response area or are placed in a way hazardous to the other tenants or other users of the driveways, loading bays, parking and Common Areas, the Landlord shall not be required to give any notice of such obstruction and may remove the same immediately upon discovery.

6.1.

QUIET ENJOYMENT

That the Tenant paying the Rent hereby reserved at the times and in the manner aforesaid and observing and performing each and every of the covenants, conditions, restrictions and stipulations by the Tenant to be observed or performed shall and may peaceably and quietly possess and enjoy the Premises for the Term hereby granted without any interruption from the Landlord or any other person lawfully claiming by, through, or under it.

6.2.

LICENSE OVER COMMON AREAS

The Landlord hereby grants to the Tenant, its agents, employees, invitees and other persons transacting business with it, during Normal Business Hours in common with all others entitled thereto, a license to have the use of the Lands Common Areas as designated from time to time by the Landlord, including without limitation the entrance to the Building, stairways, corridors, loading docks, and lavatories; provided, however, that such use shall be subject to all other provisions contained in this Lease and to the Landlord’s Rules and Regulations referred to in Schedule “D” attached hereto, provided that outside of such Normal Business Hours, the Tenant, its agents, employees, invitees and other persons transacting business with it shall only have access in accordance with the standard security procedures in effect for the Building.

7.1.

UTILITIES

Subject to Article 4.3, the Tenant shall pay for the cost of all utilities provided for its exclusive use in the Premises, including without restricting the generality of the foregoing gas, water, electricity, telephone and communication service charges and/or rates relating to services and/or utilities provided for the exclusive use of the Tenant in respect of the Tenant’s occupation of the Premises and operation of its business carried on therein or therefrom, including laboratory work and any special systems servicing its own computers or any other machinery.

7.2.

EXCESS USE

Where the Tenant does not pay directly for utilities, the Landlord may from time to time determine the Tenant’s utility consumption in the Premises upon whatever reasonable basis may be selected by it. If the Landlord determines that the Tenant’s consumption is disproportionate to the consumption of other tenants in the Building, the Landlord may require the Tenant to install at the Tenant’s expense a meter for measurement or checking of the Tenant’s consumption; and in that event the Tenant shall pay to the Landlord (or, as required by law, directly to the supplier of the utilities) as and when due from time to time any and all charges for such consumption which is disproportionate as aforesaid and which the Landlord has required to be metered. The Landlord’s determination shall be verified by an engineer selected by the Landlord (who may be an employee of the Landlord) and being so verified shall be binding on the parties hereto.

7.3.

ENERGY CONSERVATION

The Tenant covenants with the Landlord:

8.1.

LANDLORD’S REPAIRS

The Landlord covenants with the Tenant subject to Article 8.3(b) and Article 11.3 hereof and except for reasonable wear and tear and damage not covered by insurance normally maintained by prudent landlords, to repair and maintain the structural elements of the Building.

The Landlord shall provide and install to the Premises at the Landlord’s expense, in accordance with building standards and in coordination with the Tenant’s Fixturing Period (as defined in Article 15.11(a)), the following work (the “Landlord’s Work”):

(f)

ensure that the existing roof, plumbing, electrical, mechanical, including heating and ventilating systems and structural components Of the Premises are in proper working order and good repair from the Commencement Date to the expiry of the initial Term.

8.2.

TENANT’S REPAIRS

The Tenant. covenants with the Landlord:

8.3.

ABATEMENT AND TERMINATION

It is agreed between the Landlord and the Tenant that: