BIRKS GROUP INC. (Form: 6-K, Received: 05/15/2017 12:37:09)

Commencement Date :

Expiration Date :

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 or 15d-16

UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of May, 2017

Commission file number: 001-32635

BIRKS GROUP INC.

(Translation of Registrant’s name into English)

1240 Phillips Square

Montreal, Québec

Canada

H3B 3H4

(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

☒ Form 20-F ☐ Form 40-F

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):

Note : Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):

Note : Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant’s “home country”), or under the rules of the home country exchange on which the registrant’s securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant’s security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.

EXPLANATORY NOTE:

Birks Group Inc. (the “Company”) and certain wholly-owned subsidiaries entered into the following agreements:

(i)

Master Lease Agreement dated as of March 15, 2017, and executed on May 11, 2017, among the Company, Mayor’s Jewelers of Florida, Inc. and Onset Financial, Inc. for up to $4.75 million of lease financing relating to certain equipment consisting of furniture, fixtures and computer systems.

(ii)

On March 17, 2017, the Company entered into an Agreement of Principal Lease with 7739907 Canada Inc. for the new head office premises at 2020 Robert-Bourassa, Montreal, Quebec (“2020”) for a term of 16 years commencing on or about May 1, 2017 for approximately 20,000 sq. ft. of office space and 6,400 sq. ft. of warehouse and distribution space. The total annual base rent for the period from on or about May 1, 2017 to April 30, 2022 is CDN$370,000 (approximately US$ 270,766) and increases by approximately 8% every two or three year period on the respective anniversary dates thereafter. The lease contains one option to renew for a period of five years.

(iii)

On September 12, 2016, the Company entered into a Memorandum of Agreement of Lease (“Lease Agreement”) with Jean Salette or an entity designated by him (the “Landlord”) conditioned upon the Landlord acquiring the Montreal building from the Company’s former landlord, Anglo-American Investments, L.P. (“Anglo”), by November 30, 2016, which condition was met. The Landlord assumed the obligations under the existing lease until on or about May 8, 2017, and thereafter the Lease Agreement sets forth the new lease terms for the Montreal flagship store premises.

(iv)

On April 11, 2017, Mayor’s Jewelers of Florida, Inc. entered into a Short Form Industrial Building Lease with SPG Palm Crossing LLC for its corporate offices, distribution centre and workshop in the building located at 3440 NW 53 ^rd Street, Fort Lauderdale, Florida for a term of 10 years and 3 months commencing on or about May 1, 2017 and ending on July 31, 2027. The base annual rent for the first and second years are approximately $64,000 and $85,000 respectively and increases by approximately 3% each year thereafter. Mayor’s Jewelers of Florida, Inc. has two options to extend the term for a period of five years each.

The foregoing agreements are qualified in their entirety by reference to the actual agreements which are filed as Exhibits 99.1 – 99.3 respectively, to this Form 6-K.

CONTENTS

The following documents of the Registrant are submitted herewith:


99.1		Master Lease Agreement dated March 15, 2017 among Birks Group Inc., Mayor’s Jewelers of Florida, Inc. and Onset Financial, Inc.

99.2		Agreement of Principal Lease between 7739907 Canada Inc. and Birks Group Inc. executed on March 17, 2017

99.3		Short Form Industrial Building Lease effective April 11, 2017 between Mayor’s Jewelers of Florida, Inc. and SPG Palm Crossing LLC

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


	BIRKS GROUP INC.
	(Registrant)

	By:	/s/ Pasquale (Pat) Di Lillo
		Pasquale (Pat) Di Lillo
Date: May 12, 2017		Vice President, Chief Financial and Administrative Officer

EXHIBIT INDEX


Exhibit Number		Description

Exhibit 99.1		Master Lease Agreement dated March 15, 2017 among Birks Group Inc., Mayor’s Jewelers of Florida, Inc. and Onset Financial, Inc.

Exhibit 99.2		Agreement of Principal Lease between 7739907 Canada Inc. and Birks Group Inc. executed on March 17, 2017

Exhibit 99.3		Short Form Industrial Building Lease effective April 11, 2017 between Mayor’s Jewelers of Florida, Inc. and SPG Palm Crossing LLC

EXHIBIT 99.1

O N S E T F I N A N C I A L , I N C.

10813 River Front Parkway, Suite 450

South Jordan, Utah 84095

MASTER LEASE AGREEMENT NO. OFI0945288

THIS MASTER LEASE AGREEMENT is made on March 15, 2017 between ONSET FINANCIAL, INC. , with its principal office located at 10813 S. River Front Parkway, Suite 450, South Jordan, UT 84095 (the “Lessor”) and BIRKS GROUP INC. , a corporation organized under the laws of Canada with its principal office currently located at 1240 Square Phillips, Montreal, Quebec, CANADA, H3B 3H4, which shall be relocated to 2020 Boulevard Robert-Bourassa, Suite 200, Montreal, Quebec, CANADA, H3A 2A5 effective May 2017 following notice from Lessee and MAYOR’S JEWELERS OF FLORIDA, INC. , a corporation organized in the state of Florida with its principal office located at 5870 North Hiatus Road, Tamarac, FL 33321 as co-lessees (collectively, the “Lessee”).

SECTION 1. LEASE :

Lessor agrees to lease to Lessee, and Lessee agrees to lease from Lessor the Property described in any Schedule executed and delivered by Lessor and Lessee in connection with this Master Lease Agreement. Each Schedule shall incorporate by reference the terms and conditions of this Master Lease Agreement, and together with the Acceptance and Delivery Certificate and Master Progress Payment Agreement, if applicable, shall constitute a separate Lease.

SECTION 2. TERM OF LEASE :

The term of any Lease, as to all Property designated on the applicable Schedule, shall commence on the Date of Acceptance for such Property, and shall continue for a Base Period ending that number of months from the Lease Commencement Date as specified in the Schedule. Thereafter, Lessee shall have those options as provided in Section 20n of this Master Lease Agreement.

SECTION 3. RENT AND PAYMENT :

Lessee shall pay as rent for use of the Property, aggregate rentals equal to the sum of all the Monthly Rentals and other payments due under the Lease for the entire Base Period. The Monthly Rental shall begin on the Date of Acceptance and shall be due and payable by Lessee in advance on the first day of each month throughout the Base Period. If the Date of Acceptance does not fall on the first day of a calendar quarter, then the first rental payment shall be calculated by multiplying the number of days from and including the Date of Acceptance to the Lease Commencement Date by a daily rental equal to one-thirtieth (1/30) of the Monthly Rental, and shall be due and payable on the Date of Acceptance. Lessee shall pay to Lessor, or its assigns, all rentals as due when due, without notice or demand, to Lessor’s address set forth above, or as otherwise directed in writing by Lessor, or its assigns. LESSEE SHALL NOT ABATE, SET OFF OR DEDUCT ANY AMOUNT OR DAMAGES FROM OR REDUCE ANY MONTHLY RENTAL OR OTHER PAYMENT DUE FOR ANY REASON. THIS LEASE IS NON-CANCELABLE FOR THE ENTIRE TERM OF THE BASE PERIOD AND ANY RENEWAL PERIODS .

If any rental or other payment due under any Lease shall be unpaid ten (10) days after its due date, Lessee will pay on demand, as a late charge, but not as interest, the greater of twenty-five dollars ($25.00) or ten percent (10%) per month on any such unpaid amount but in no event to exceed maximum lawful charges.

SECTION 4. TAXES AND FEES :

Lessee shall promptly pay to Lessor, and agrees to indemnify and hold Lessor harmless from all taxes, fees, assessments and charges paid, payable or required to be collected by Lessor (together with any penalties, fines or interest thereon), which are levied or based on the Monthly Rental or other payment due under the Lease, or on the delivery, acquisition, possession, use, operation, lease, rental, sale, purchase, control or value of the Property, including without limitation, registration and license fees and assessments, recycling fees, state and local privilege or excise taxes, documentary stamp taxes or assessments, sales and use taxes, personal and other property taxes, and taxes or charges based on gross revenue, but excluding taxes based on Lessor’s

net income, (collectively “taxes”), whether the same be assessed to Lessor or Lessee. Lessee also agrees to pay to Lessor all servicing and administrative costs directly incurred by Lessor, which shall not exceed more than $1,000 per year, associated with processing and paying various fees and taxes that arise in connection with this Master Lease Agreement. Lessor shall file all required reports and returns with all applicable governmental agencies relating to the taxes concerning the Property.

SECTION 5. NET LEASE :

This is a fully net, non-cancelable lease contract which may not be terminated for any reason except as otherwise specifically provided herein. Lessee has no right of prepayment unless agreed to in writing by Lessor. Lessor and Lessee agree that any Lease is a “Finance Lease” as defined by the Uniform Commercial Code Article 2A. Lessee shall be responsible for and shall indemnify Lessor against, all costs, expenses and claims of every nature whatsoever arising out of or in connection with or related to the Lease or the Property.

Lessee acknowledges and agrees that its obligations to pay all Monthly Rentals and other amounts due and owing and perform its obligations hereunder shall be primary, absolute, unconditional, independent and irrevocable and shall not be subject to or affected by (i) any circumstance whatsoever, including, without limitation, any setoff, counterclaim, recoupment, abatement, suspension, reduction, rescission, defense or other right otherwise available to Lessee; (ii) any defect in the title, merchantability, condition, design, operation or fitness for use of, or any damage to, removal, abandonment, requisition, taking condemnation or loss or theft or destruction of, the Property, or any interference, interruption, restriction, curtailment or cessation in or prohibition of the use or possession thereof by the Lessee or any other person for any reason whatsoever; or (iii) failure on the part of the manufacturer or the shipper of the Property to deliver the Property or any part thereof to Lessee. Lessor is not responsible to install, test, repair, service, or maintain any Property.

SECTION 6. CONDITIONS PRECEDENT :

Lessor’s obligations under each Schedule, including its obligation to purchase and lease any Property to be leased thereunder, are conditioned upon Lessor’s receipt of, in form or substance satisfactory to Lessor, and Lessor’s determination that all of the following are satisfactory: (i) evidence as to due compliance with the insurance provisions hereof; (ii) Uniform Commercial Code financing statements and all other filings and recordings as reasonably required by Lessor and any applicable Personal Property Security Act (or equivalent personal property security legislation in effect in the provinces and territories of Canada collectively referred to as the “PPSA”); (iii) lien searches in the jurisdiction of Lessee’s organization and in each jurisdiction in which the Property and/or Lessee’s chief executive office are located; (iv) incumbency and signature of the officers of Lessee authorized to execute such documents; (v) resolutions of Lessee’s Board of Directors and/or Members duly authorizing the leasing, or sale and leaseback, as the case may be, of the Property hereunder and the execution, delivery and performance of the Lease; (vi) if requested by Lessor, certificates of good standing from the jurisdiction of Lessee’s organization, and (vii) if requested by Lessor, a copy of Lessee’s organizational documents and evidence of Lessee’s organizational number.

SECTION 7. MAINTENANCE AND REPAIRS; RETURN OF PROPERTY :

During the continuance of each Lease, Lessee shall, at its own expense, either (1) enter into and maintain in force a contract with the manufacturer or other qualified maintenance organization reasonably satisfactory to Lessor for maintenance of each item of Property that requires such a contract, or (ii) self-maintain each item of Property in accordance with the manufacturer’s standard maintenance agreement. Such contract or self-maintenance as to each item shall commence upon the earlier of the Certificate date, if

Page 1 of 10

applicable, or the Date of Acceptance. Upon request Lessee shall furnish Lessor with a copy of such contract or provide to Lessor satisfactory evidence of self-maintenance.

During the continuance of each Lease, Lessee shall, at its own cost and expense, and in accordance with all manufacturer maintenance specifications, (i) keep the Property in good repair, condition, operating order and appearance, (ii) make all necessary adjustments repairs and replacements, (iii) not use or permit the Property to be used for any purpose for which, in the opinion of the manufacturer, the Property is not designed or reasonably suitable, and (iv) furnish all required parts, mechanisms, devices, maintenance and servicing, so as to keep each item of Property and any part in good repair and operating order in the same condition and appearance as when delivered to the Lessee, ordinary wear and tear excepted. Such parts, mechanisms and devices shall immediately become a part of the Property for all purposes hereunder and title thereto shall vest in Lessor. If the manufacturer does not provide maintenance specifications, Lessee shall perform all maintenance in accordance with industry standards for like property.

c.	Lessee shall immediately notify Lessor in writing of all details concerning any damage or loss to the Property, including without limitation, any damage or loss arising from the alleged or apparent improper manufacture, functioning or operation of the Property.

Lessee shall pay all shipping and delivery charges and other expenses incurred in connection with the Property. Upon default, or at the expiration or earlier termination of any Lease, Lessee shall, at its own expense, assemble, prepare for shipment and make the Property available for return to Lessor at Lessee’s location(s). Upon such return, the Property shall be in the same operating order, repair, condition and appearance as on the Date of Acceptance, except for reasonable wear and tear from proper use thereof, and shall include all engineering changes theretofore prescribed by the manufacturer.

With regard to Software, at the expiration or earlier termination of any Lease, or upon demand by Lessor upon the occurrence of an Event of Default (hereinafter defined) under the Lease, unless rights to the Software have been transferred to Lessee, Lessee shall (i) destroy all copies or duplicates of the Software which were not returned to Lessor (ii); delete from its systems all Software then installed; (iii) cease using the Software altogether or; iv) disable the computers, computer systems or other equipment which run and/or operate and or are controlled by the Software. Upon its receipt from Lessee, Lessor shall be responsible to return the Software to the owner/vendor/licensor so that Lessee shall not be in breach of any software license.

SECTION 8. USE: ALTERATIONS AND ATTACHMENTS :

Lessee shall at all times keep the Property in its sole possession and control. The Property shall not be moved from the location stated in the Schedule without the prior written consent of Lessor, which consent shall not be unreasonably withheld, provided, however, in no Event shall the Property be moved to a location outside the United States or Canada, as the case may be.

b.	The Property is leased solely for commercial or business purposes.

After Lessee receives and inspects any Property and is satisfied that the Property is acceptable, Lessee shall execute and deliver to Lessor an Acceptance and Delivery Certificate in form provided by Lessor; provided, however, that Lessee’s failure to execute and deliver an Acceptance and Delivery Certificate for any Property shall not affect the validity and enforceability of the Lease with respect to the Property. If Lessee has executed and delivered a Master Progress Payment Agreement, Lessor may, in its sole discretion, at any time by written notice to Lessee, declare all prior Certificates executed in connection with the Master Progress Payment Agreement to be and constitute the Acceptance and Delivery Certificate for all purposes under the Lease, and the Date of Acceptance of the Lease shall be the date determined by Lessor in its sole discretion which shall not be earlier than the date of the last Certificate. In addition to the inspection rights of Lessor and its

assigns under Section 9(b), if required by Lessor and/or its assigns, Lessee shall permit Lessor or Lessor’s agent (or Lessor’s assigns or an agent of Lessor’s assigns), at any reasonable time during normal business hours, (i) to inspect the Property, and (ii) to inspect the premises where the property is or will be located, and (iii) to visit Lessee’s management at Lessee’s headquarters or elsewhere. In addition, Lessee shall, if required by Lessor and/or its assigns, provide Lessor and/or its assigns with an inspection report satisfactory to Lessor and/or its assigns, in its or their sole discretion. Notwithstanding any other provision herein, any of the foregoing inspections shall be performed, and any such report shall be provided, prior to the execution and delivery by Lessee of an Acceptance and Delivery Certificate. Lessee shall pay any and all costs, including travel expenses, incurred by Lessor and/or its assigns in connection with any such inspections, reports and visits.

The Property is and shall remain personal property during the term of the Lease notwithstanding that any portion thereof may in any manner become affixed, attached to or located on real property or any building or improvement thereon. Lessee shall not affix or attach, or permit any of the Property to become affixed or attached to any real property in any manner which would change its nature from that of personal property to real property. Lessee shall not permit the Property to become an accession to other goods or a fixture to or part of any real property. Lessee will obtain and deliver to Lessor a lien waiver in a form satisfactory to Lessor, from all persons not a party hereto who might claim an interest, lien or other claim in the Property.

e.	Lessee shall comply with all applicable laws, regulations, requirements, rules and orders, all manufacturer’s instructions and warranty requirements, and with the conditions and requirements of all policies of insurance with respect to the Property and the Lease.

Lessee may not make alterations or attachments to the Property that will detrimentally affect the Property’s end of Base Period residual value without first obtaining the written consent of Lessor, which shall not be unreasonably withheld. Any such alterations or attachments shall be made at Lessee’s expense and shall not interfere with the normal and satisfactory operation or maintenance of the Property. The manufacturer may incorporate engineering changes or make temporary alterations to the Property upon request of Lessee. Unless Lessor shall otherwise agree in writing, all such alterations and attachments shall be and become the property of Lessor upon their attachment to the Property or, at the option of Lessor, shall be removed by Lessee at the termination of the Lease and the Property restored at Lessee’s expense to its original condition, reasonable wear and tear only excepted.

Lessee shall ensure that the Property is installed, used, operated and, at the termination of the Lease, if applicable, removed at Lessee’s expense (i) in accordance with any applicable manufacturer’s manuals or instructions; (ii) by competent and duly qualified personnel only; and (iii) in accordance with applicable governmental regulations.

In the event the Property includes Software, the following shall apply: (i) Lessee shall possess and use the Software in accordance with the terms and conditions of any license agreement entered into with the owner/vendor/licensor of such Software ( “License” ) (at Lessor’s request, Lessee shall provide a complete copy of the License to Lessor) and shall not breach the License; (ii) Lessee agrees that Lessor has an interest in the License and Software due to its payment of the price thereof and is an assignee or third-party beneficiary of the License; (iii) as due consideration for Lessor’s payment of the price of the License and Software and for providing the Software to Lessee at a lease rate (as opposed to a debt rate), Lessee agrees that Lessor is leasing (and not financing) the Software to Lessee; (iv) except for the original price paid by Lessor, Lessee shall, at its own expense, pay promptly when due all servicing fees, maintenance fees, update and upgrade costs, modification costs, and all other costs and expenses relating to the License and Software and maintain the License in effect during the term of the Lease; and (v) the Software shall be deemed Property for all purposes under the Lease.

Page 2 of 10

Unless otherwise agreed to in writing by Lessor, the Property shall at all times be used in Lessee’s business and shall not at any time be held for sale or lease or otherwise constitute “inventory”, as such term is defined in Utah Uniform Commercial Code or the PPSA (as may be amended from time to time).

With respect to Lessee’s use of the property, Lessee shall comply with all present and future federal, state, regional, provincial, local and municipal laws, statutes, ordinances, regulations, rules, judicial and similar requirements of all federal, state, regional, provincial, local and municipal governmental agencies, bodies or officials or other governmental entities with legal authority pertaining to the protection of human or wildlife health and safety or the environment, including, without limitation, any such laws, statutes, ordinances, regulations, rules, judicial and administrative orders and decrees, permits, licenses, approvals, authorizations and similar requirements regulating or relating to Hazardous Materials (defined below) or to the generation, use, storage, release, presence, disposal, transport, or handling of any other substance, oil, oil byproducts, gas element, or material which has the potential to pollute, contaminate or harm any land, subsurface area, water source or watercourse, air or other natural resource, hereinafter referred to as “Environmental Laws”.

“Hazardous Materials”, as it relates to Property located in the United States, is defined as any hazardous or toxic substance, material or waste that are or become regulated under any applicable local, state or federal law, including, but not limited to, those substances, materials, and wastes listed in the United States Department of Transportation Hazardous Materials Table (49 CFR 172.101) or defined by the Environmental Protection Agency (“EPA”) as “any material that poses a threat to human health and/or the environment. Typical hazardous substances are toxic, corrosive, ignitable, explosive, or chemically reactive”. “Hazardous Materials”, as it relates to Property located in Canada is defined as any substance, product, waste, pollutant, material, chemical, contaminant, dangerous good, ozone-depleting substance or other material (including any constitute of any of them) that is or becomes listed, regulated, or addressed under Environmental Laws (including asbestos, petroleum and polychlorinated biphenyls).

SECTION 9. OWNERSHIP AND INSPECTION:

The Property shall at all times be the property of Lessor or its assigns, and Lessee shall have no right, title or interest therein except as to the use thereof subject to the terms and conditions of the Lease. For purposes of the foregoing, Lessee transfers to Lessor all of Lessee’s right, title and interest (including all ownership interest) in and to the Property free and clear of all liens, security interests and encumbrances. Lessor may affix (or require Lessee to affix) tags, decals or plates to the Property indicating Lessor’s ownership, and Lessee shall not permit their removal or concealment. Lessee shall not permit the name of any person or entity other than Lessor or its assigns to be placed on the Property as a designation that might be interpreted as a claim of ownership or security interest.

Lessor, its assigns and their agents shall have free access to the Property at all reasonable times during normal business hours for the purpose of inspecting the Property and for any other purpose contemplated in the Lease. Lessee shall pay any and all costs incurred by Lessor in connection with any inspection performed by Lessor and/or its assigns.

c.	LESSEE SHALL KEEP THE PROPERTY AND LESSEE’S INTEREST UNDER ANY LEASE FREE AND CLEAR OF ALL LIENS AND ENCUMBRANCES, EXCEPT THOSE PERMITTED IN WRITING BY LESSOR OR ITS ASSIGNS.

SECTION 10. DISCLAIMER OF WARRANTIES:

a.	WITHOUT WAIVING ANY CLAIM THE LESSEE MAY HAVE AGAINST ANY MANUFACTURER, LESSEE ACKNOWLEDGES AND AGREES THAT i) LESSOR IS NOT A SELLER, SUPPLIER OR THE MANUFACTURER OF THE PROPERTY (AS SUCH TERMS ARE DEFINED OR USED, AS THE CASE MAY BE, IN THE UNIFORM COMMERCIAL CODE OR PPSA) OR DEALER,

NOR A SELLER’S OR A DEALER’S AGENT, ii) THE PROPERTY IS OF A SIZE, DESIGN, CAPACITY AND MANUFACTURE SELECTED BY AND ACCEPTABLE TO THE LESSEE, iii) THE LESSEE HAS EXAMINED AND IS SATISFIED THAT EVERY ITEM OF PROPERTY IS SUITABLE FOR ITS PURPOSE, iv) THE LESSEE ACCEPTS THE PROPERTY AND EACH PART THEREOF “AS IS” AND “WHERE IS”, V) THE LESSOR HAS NOT MADE AND DOES NOT MAKE, AND HEREBY DISCLAIMS LIABILITY FOR, AND LESSEE HEREBY WAIVES ALL RIGHTS AGAINST LESSOR RELATING TO, ANY AND ALL WARRANTIES, REPRESENTATIONS OR OBLIGATIONS WHATSOEVER, EXPRESS OR IMPLIED, ARISING BY APPLICABLE LAW OR OTHERWISE, RELATING TO THE PROPERTY, OR ANY PART THEREOF, INCLUDING, WITHOUT LIMITATION, ANY AND ALL WARRANTIES, REPRESENTATIONS OR OBLIGATIONS AS TO: (1) THE DESCRIPTION, CONDITION, DESIGN, QUALITY OR PERFORMANCE OF THE PROPERTY OR QUALITY OR CAPACITY OF MATERIALS OR WORKMANSHIP IN THE PROPERTY; (2) ITS MERCHANTABILITY OR FITNESS OR SUITABILITY FOR A PARTICULAR PURPOSE WHETHER OR NOT DISCLOSED TO LESSOR; (3) THE ABSENCE OF LATENT OR OTHER DEFECTS, WHETHER OR NOT DISCOVERABLE (4) THE ABSENCE OF ANY INFRINGEMENT OF ANY PATENT, TRADEMARK OR COPYRIGHT OR THE LIKE; AND (5) THE ABSENCE OF OBLIGATIONS BASED ON STRICT LIABILITY IN TORT. It is agreed that all such risks incident to the matters described in this Section 10a, as between the Lessor and the Lessee are to be borne by the Lessee. If the Property or Software is not properly installed, does not function as represented or warranted by original owner/seller/supplier/licensor, or is unsatisfactory for any reason, Lessee shall make any claim on account thereof solely against original owner/seller/supplier/licensor and shall nevertheless pay all sums payable under the Lease, Lessee hereby waiving the right to make any such claims against Lessor. Lessor shall not be liable to Lessee for any loss, damage or expense of any kind or nature caused, directly or indirectly, by the Property or the use, possession or maintenance thereof, or the repair, service or adjustment thereof, or by any delay or failure to provide any such maintenance, repair, service or adjustment, or by any interruption of service or loss of use thereof (including without limitation, Lessee’s use of or right to use any Software) or for any loss of business howsoever caused.

NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THE LEASE, LESSOR SHALL NOT, UNDER ANY CIRCUMSTANCES, BE LIABLE TO LESSEE OR ANY THIRD PARTY, FOR CONSEQUENTIAL, INCIDENTAL, SPECIAL OR EXEMPLARY DAMAGES ARISING OUT OF OR RELATED TO THE TRANSACTION CONTEMPLATED HEREUNDER, WHETHER IN AN ACTION BASED ON CONTRACT, TORT (INCLUDING NEGLIGENCE OR STRICT LIABILITY) OR ANY OTHER LEGAL THEORY, INCLUDING WITHOUT LIMITATION, LOSS OF ANTICIPATED PROFITS, OR BENEFITS OF USE OR LOSS OF BUSINESS, EVEN IF LESSOR IS APPRISED OF THE LIKELIHOOD OF SUCH DAMAGES OCCURRING.

IT IS EXPRESSLY UNDERSTOOD AND AGREED THAT EACH AND EVERY PROVISION OF ANY LEASE WHICH PROVIDES FOR A LIMITATION OF LIABILITY, DISCLAIMER OF WARRANTIES OR EXCLUSION OF DAMAGES, IS INTENDED BY THE PARTIES TO BE SEVERABLE FROM ANY OTHER PROVISION AND IS A SEPARABLE AND INDEPENDENT ELEMENT OF RISK ALLOCATION AND IS INTENDED TO BE ENFORCED AS SUCH.

Lessor assigns to Lessee all assignable warranties on the Property, including without limitation any warranties described in Lessor’s purchase contract, which assignment shall be effective only (i) during the Base Period and any renewal period thereof; and (ii) so long as no Event of Default exists.

SECTION 11. ASSIGNMENT BY LESSOR :

Lessor may assign or transfer its rights and interests in the Lease and/or the Property to another party (“ Lessor’s Assignee ”) either outright or as security for loans (collectively the “ Underwriting ”). Upon notice of any such assignment and instructions from Lessor, Lessee shall pay its

Page 3 of 10

Monthly Rental and other payments and perform its other obligations under the Lease to the Lessor’s Assignee (or to another party designated by Lessor’s Assignee). Upon any such sale or assignment, LESSEE’S OBLIGATIONS TO LESSOR’S ASSIGNEE UNDER THE ASSIGNED LEASE SHALL BE ABSOLUTE AND UNCONDITIONAL AND LESSEE WILL NOT ASSERT AGAINST LESSOR’S ASSIGNEE ANY CLAIM, DEFENSE, OFFSET OR COUNTERCLAIM WHICH LESSEE MIGHT HAVE AGAINST LESSOR. Lessee waives and will not assert against any assignee of Lessor any claims, defenses, or set-offs which Lessee could assert against Lessor. Lessor’s Assignee shall have all of the rights but none of the obligations of Lessor under the assigned Lease, and after such assignment Lessor shall continue to be responsible for all of Lessor’s obligations under the Lease.

Upon any such assignment, Lessee agrees to promptly execute or otherwise authenticate and deliver to Lessor estoppel certificates, acknowledgements of assignment, records and other documents requested by Lessor which acknowledge the assignment, and affirmation of provisions of the Lease which may be required to effect the Underwriting. Lessee authorizes Lessor’s assigns to file UCC-1 financing statements or precautionary filings or similar filings under the PPSA as Lessor or its assigns deem necessary. Lessor’s assigns are authorized to take any measures necessary to protect their interest in the Property.

Only one executed counterpart of any Schedule shall be marked “Original”; any other executed counterparts shall be marked “Duplicate Original” or “Counterpart”. No security interest in any Schedule may be created or perfected through the transfer or possession or control, as applicable, of any counterpart other than the document or record, as applicable, marked “Original”.

SECTION 12. ASSIGNMENT BY LESSEE :

LESSEE MAY NOT ASSIGN ANY LEASE OR ANY OF ITS RIGHTS HEREUNDER OR SUBLEASE THE PROPERTY WITHOUT THE PRIOR WRITTEN CONSENT OF LESSOR. NO PERMITTED ASSIGNMENT OR SUBLEASE SHALL RELIEVE LESSEE OF ANY OF ITS OBLIGATIONS HEREUNDER.

Lessee grants Lessor a security interest in any existing or future sublease of the Property and the proceeds thereof, whether or not such sublease is prohibited. Subject to the terms of this Lease, this Lease and each Schedule inure to the benefit of, and are binding upon, the successors and assigns of Lessee, and, without limiting the foregoing, shall bind all persons who become bound as a “new debtor” (as defined in the Uniform Commercial Code or as a debtor under the PPSA) to this Lease and any Schedule.

SECTION 13. LESSEE’S REPRESENTATIONS AND WARRANTIES :

Lessee represents and warrants as follows:

If Lessee is a corporation, that it is duly organized and validly existing in good standing under the laws of the jurisdiction of its incorporation, that it is duly qualified to do business in each jurisdiction where any Property is, or is to be located, and has full corporate power and authority to hold property under lease and to enter into and perform its obligations under any Lease; that the execution, delivery and performance by Lessee of any Lease has been duly authorized by all necessary corporate action on the part of Lessee, and is not inconsistent with its articles of incorporation or by-laws or other governing instruments;

(i) Lessee’s state or jurisdiction of organization is the state or jurisdiction listed in the introductory paragraph of this Lease; (ii) Lessee’s principal office is located in the state or jurisdiction listed in the introductory paragraph of this Lease; (iii) Lessee is the legal entity or organization indicated in the introductory paragraph of this Lease, which organization is duly organized, validly existing and in good standing under the laws of the state or jurisdiction listed in the introductory paragraph of this Lease; and (iv) Lessee’s full and exact legal name is the same as listed in the introductory paragraph of this Lease;

c.	The execution, delivery and performance by Lessee of any Lease does not violate any law or governmental rule, regulation, or order

applicable to Lessee, does not and will not contravene any provision of, constitute a default under, or result in the creation of any lien on or in any property or assets of the Lessee, pursuant to any indenture, mortgage, contract, or other instrument to which it is bound and, upon execution and delivery of each Lease, will constitute a legal, valid and binding agreement of Lessee, enforceable in accordance with its terms;

If Lessee is a partnership, that it is duly organized by written partnership agreement and validly existing in accordance with the laws of the jurisdiction of its organization, that it is duly qualified to do business in each jurisdiction where the Property is, or is to be located, and has full power and authority to hold property under lease and to enter into and perform its obligations under any Lease; that the execution, delivery and performance by Lessee of any Lease has been duly authorized by all necessary action on the part of the Lessee, and is not inconsistent with its partnership agreement or other governing instruments. Upon request, Lessee will deliver to Lessor certified copies of its partnership agreement and other governing instruments and original certificate of partners and other instruments deemed necessary or desirable by Lessor. To the extent required by applicable law, Lessee has filed and published its fictitious business name certificate;

e.	No action, including any permits or consents, in respect of or by any state, provincial, federal or other governmental authority or agency is required with respect to the execution, delivery and performance by Lessee of any Lease, and;

There are no actions, suits or proceedings pending or, to the knowledge of the Lessee, threatened against or affecting the Lessee in any court or before any governmental commission, board or authority which, if adversely determined, will have a material adverse effect on the ability of the Lessee to perform its obligations under any Lease.

SECTION 14. RISK OF LOSS ON LESSEE :

From the earlier of the date the supplier ships the Property to Lessee or the date Lessor confirms Lessee’s purchase order or contract to supplier until the date the Property is returned to Lessor as provided in the Lease, Lessee hereby assumes and shall bear all risk of loss for theft, damage, non-delivery or destruction to the Property or caused by the Property to the environment, persons or other property (hereafter, such loss, damage, non-delivery or destruction to the Property or caused by the Property to the environment, persons or other property shall be referred to as the “Casualty”), howsoever caused. NO SUCH CASUALTY SHALL IMPAIR ANY OBLIGATION OF LESSEE UNDER THIS LEASE, WHICH OBLIGATION, INCLUDING TIMELY RENTAL PAYMENTS, SHALL CONTINUE IN FULL FORCE AND EFFECT.

SECTION 15. LESSEE’S WAIVERS :

To the extent permitted by applicable law, Lessee hereby waives any and all rights and remedies conferred upon a Lessee by §§ 70A-2A-508 through 70A-2A-522 of the Utah Uniform Commercial Code, including but not limited to Lessee’s rights to: (i) cancel the Lease; (ii) repudiate the Lease; (iii) reject the Property; (iv) revoke acceptance of the Property; (v) recover damages from Lessor for any breaches of warranty or for any other reason; (vi) claim, grant or permit a security interest in the Property in Lessee’s possession or control for any reason; (vii) deduct all or any part of any claimed damages resulting from Lessor’s default, if any, under the Lease; (viii) cover by making any purchase or lease of or contract to purchase or lease property in substitution for the Property due from Lessor; (ix) recover any general, special, incidental or consequential damages, for any reason whatsoever; and (x) commence legal action against Lessor for specific performance, replevin, detinue, sequestration, claim and delivery or the like for any Property identified in the Lease. To the extent permitted by applicable law, Lessee also hereby waives any rights now or hereafter conferred by statute or otherwise which may require Lessor to sell, lease or otherwise use any Property in mitigation of Lessor’s Damages as set forth in Section 19 hereof or which may otherwise limit or modify any of Lessor’s rights or remedies in that section. To the extent applicable, the contract evidenced hereby shall be a contract of leasing as contemplated by Article 1842 of the Civil Code of Quebec , and Lessee declares and represents that it chose the Property leased hereunder which will be used for the purpose of its enterprise.

Page 4 of 10

Lessee, if a corporation, hereby agrees that the Limitation of Civil Rights Act (Saskatchewan) , as amended from time to time, shall have no application to the rights, powers or remedies of Lessor hereunder, and hereby waives any rights Lessee may have thereunder.

SECTION 16. INDEMNIFICATION:

Lessee shall indemnify and hold Lessor harmless from and against any and all claims, (including without limitation negligence, tort and strict liability), damages, judgments, suits and legal proceedings, and any and all reasonable costs and expenses in connection therewith (including attorney fees incurred by Lessor either in enforcing this indemnity or in defending against such claims), arising out of or in any manner connected with or resulting from the Lease or the Property, including, without limitation the manufacture, purchase, financing, ownership, rejection, non-delivery, transportation, delivery, possession, use, operation, maintenance, condition, lease, return, storage or disposition thereof; including without limitation (i) claims for injury to or death of persons and for damage to property; (ii) claims relating to latent or other defects in the Property whether or not discoverable by Lessor; (iii) claims relating to patent, copyright, or trademark infringement; and (iv) claims for wrongful, negligent or improper act or misuse by Lessor; and (v) claims for any damages to persons or property, any costs associated with, or any fines caused by violation of any Environmental Laws. Lessee agrees to give Lessor prompt notice of any such claim or liability. For purposes of this paragraph and any Lease, the term “Lessor” shall include Lessor, its successors and assigns, shareholders, members, owners, partners, directors, officers, representatives and agents, and the provisions of this paragraph shall survive expiration of any Lease with respect to events occurring prior thereto.

Upon request of Lessor, Lessee shall assume the defense of all demands, claims, or actions, suits and all proceedings against Lessor for which indemnity is provided and shall allow Lessor to participate in the defense thereof. Lessor shall be subrogated to all rights of Lessee for any matter which Lessor has assumed obligation hereunder, and may settle any such demand, claim, or action without Lessee’s prior consent, and without prejudice to Lessor’s right to indemnification hereunder.

SECTION 17. INSURANCE :

Lessee shall obtain and maintain for the entire time the Lease is in effect, at its own expense (as primary insurance for Lessor and Lessee), property damage and liability insurance (including any claims caused from the breach of any Environmental Laws involving the Property, if applicable) and insurance against loss or damage to the Property including without limitation loss by fire (including so-called extended coverage), theft, collision and such other risks of loss as are customarily insured against on the type of Property leased under any lease and by businesses in which Lessee is engaged, in such amounts, in such form and with such insurers as shall be satisfactory to Lessor in its reasonable discretion; provided, however, that the amount of insurance against loss or damage to the Property shall be equal to or greater than the full replacement value or the Stipulated Loss Value (as defined herein) of such items of Property. Stipulated Loss Value means the product of the Property cost (as designated on the related Schedule) and the applicable percentage factor set forth on the Stipulated Loss Schedule attached to the Schedule (“Stipulated Loss Value”). Each insurance policy will name Lessee as insured and Lessor and its assignees as additional insureds and loss payees thereof, shall contain cross-liability endorsements and shall contain a clause requiring the insurer to give Lessor and its assignees at least thirty (30) days prior written notice of any material alteration in the terms of such policy or of the cancellation thereof. Lessee shall furnish to Lessor a certificate of insurance or other evidence satisfactory to Lessor that such insurance coverage is in effect; provided, however, that Lessor shall be under no duty either to ascertain the existence of or to examine such insurance policy or to advise Lessee in the event such insurance coverage shall not comply with the requirements hereof. All insurance covering loss or damage to the Property shall contain a breach of warranty clause satisfactory to Lessor, in its reasonable discretion.

In the event of a Casualty to the Property (or any part thereof) and irrespective of payment from any insurance coverage maintained by Lessee, but applying full credit thereof, Lessee shall at the option of Lessor, (i) place the Property in good repair, condition and working order; or (ii) replace the Property (or any part thereof) with like property of equal

or greater value, in good repair, condition and working order and transfer clear title to such replacement property to Lessor whereupon such replacement property shall be deemed the Property for all purposes under the Lease; or (iii) pay to Lessor the total rent due and owing at the time of such payment plus an amount calculated by Lessor which is equal to the Stipulated Loss Value (defined in the Stipulated Loss Schedule) specified in the Stipulated Loss Schedule attached to the Schedule.

Lessee shall notify Lessor within thirty (30) days of the actual date of the Casualty; Lessor will notify Lessee of its election of either option (i), (ii), or (iii), as set forth above, within five (5) days of receipt of Lessee’s notice. Lessee will then fully perform the repair, replacement or payment (as elected by Lessor) within ninety (90) days of the date of the Casualty.

SECTION 18. DEFAULT:

An “Event of Default” shall occur under any Lease if:

a.	Lessee fails to pay any Monthly Rental or other payment required under the Lease when the same becomes due and payable and such failure continues for ten (10) days after notification is received from Lessor thereof;

b.	Lessee fails to promptly execute or otherwise authenticate and deliver to Lessor or its assigns any document or record, as applicable, required under the terms of this Master Lease Agreement and such failure continues uncured for ten (10) days after notification is received from Lessor thereof;

Lessee attempts to or does, remove, sell, assign, transfer, encumber, sublet or part with possession of any one or more items of the Property or any interest under any Lease, except as expressly permitted herein, or permits a judgment or other claim to become a lien upon any or all of Lessee’s assets or upon the Property;

d.	Lessee permits any item of Property to become subject to any levy, seizure, attachment, assignment or execution; or Lessee abandons any item of Property;

e.	Lessee fails to immediately (within thirty (30) days) notify Lessor of any loss, damage, or destruction to the Property or fails to timely repair, replace, or make payment as required in Sections 7 and 17, herein;

Lessee or any guarantor, shall (i) be adjudicated insolvent or bankrupt, or cease, be unable, or admit its inability, to pay its debts as they mature, or make a general assignment for the benefit of creditors or enter into any composition or arrangement with creditors; (ii) apply for or consent to the appointment of a receiver, trustee or liquidator of it or of a substantial part of its property, or authorize such application or consent, or proceedings seeking such appointment shall be instituted against it without such authorization, consent or application and shall continue undismissed for a period of sixty (60) days; (iii) authorize or file a voluntary petition in bankruptcy or apply for or consent to the application of any bankruptcy, reorganization in bankruptcy, arrangement, readjustment of debt, insolvency, dissolution, moratorium or other similar law of any jurisdiction, or authorize such application or consent; or proceedings to such end shall be instituted against it without such authorization, application or consent and such proceeding instituted against it shall continue undismissed for a period of sixty (60) days;

Lessee is in default under any Lease or agreement executed with Lessor; or Lessee fails to sign or otherwise authenticate and deliver to Lessor any document or record reasonably requested by Lessor in connection with any Lease executed with Lessor; or Lessee fails to do anything whatsoever determined by Lessor to be necessary or desirable to effectuate the transaction contemplated by any Lease executed with Lessor; or Lessee fails to protect Lessor’s rights and interests in any Lease and the Property; or Lessee fails to provide financial statements to Lessor as provided in Section 20k hereof; or Lessee is in default of any material obligation or agreement with a primary lender or financial lending institution other than Lessor which obligation or agreement arises independently of any Lease;

Page 5 of 10

h.	Lessee or any guarantor, breaches any of its representations and warranties made under any Lease, or if any such representations or warranties shall be false or misleading in any material respect;

Lessee or any guarantor, fails to observe or perform any of its covenants and obligations required to be observed or performed under the Lease and such failure continues uncured for ten (10) days after notification is received from Lessor thereof, except that the ten (10) day cure period shall not apply and an Event of Default shall occur immediately upon Lessee’s failure to maintain insurance;

Lessee or any guarantor, shall suffer a material adverse change in its financial condition after the date hereof as determined by Lessor in its reasonable discretion, or there shall occur a substantial change in ownership of the outstanding stock of Lessee (except for customary planning changes) or any guarantor or a substantial change in control of the board of directors and/or members of Lessee or any guarantor, resulting in an adverse change in Lessee’s financial condition or creditworthiness as determined by Lessor in its reasonable discretion;

Lessor in good faith believes the Property to be in danger of misuse, abuse or confiscation or to be in any other way threatened, or believes in good faith for any other reason that the prospect of payment or performance has become impaired, or if Lessee takes any action, makes any representation, or fails to do anything reasonably requested by Lessor at any time before or after the execution of this Master Lease Agreement, the result of which causes Lessor, in good faith, to believe that the prospect of Lessee’s payment or performance under the Lease is impaired, or otherwise causes Lessor to feel insecure in funding or continuing to fund the Lease or any Schedule;

Lessee or any guarantor shall have terminated or changed its corporate existence, consolidated with, merged into, or conveyed or leased substantially all of its assets to any person or entity, unless: (i) such person or entity executes and delivers to Lessor an agreement satisfactory in form and substance to Lessor, in its sole discretion, containing such person’s or entity’s effective assumption, and its agreement to pay, perform, comply with and otherwise be liable for, in a due and punctual manner, all of Lessee’s (or guarantor’s) obligations having previously arisen, or then or thereafter arising, under the Lease or guaranty, as the case may be, together with any and all documents, agreements, instruments, certificates, opinions and filings requested by Lessor; (ii) Lessor is satisfied as to the creditworthiness of such person’s or entity’s conformance to other standard criteria then used by Lessor for such purposes; and (iii) Lessee or any guarantor has provided no less than thirty (30) days prior written notice of such occurrence to Lessor or its assigns;

Lessee breaches any License, maintenance or other agreement for Software or fails to pay when due all servicing fees, maintenance fees, update and upgrade costs, modification costs, and all other costs and expenses relating to the License and Software and fails to maintain the License in effect during the term of the Lease, and such failure continues uncured for a period of ten (10) days after notification is received from Lessor thereof.

SECTION 19. REMEDIES:

Upon the occurrence of any Event of Default and at any time thereafter, Lessor may with or without giving notice to Lessee and with or without canceling the Lease, do any one or more of the following

a.	enforce this Master Lease Agreement according to its terms;

b.	require additional collateral to secure the Lease;

c.	upon notice to Lessee, cancel this Master Lease Agreement and any or all Schedules executed pursuant thereto;

d.	advance funds on Lessee’s behalf to cure the Event of Default, whereupon Lessee shall immediately reimburse Lessor therefore, together with late charges accrued thereon;

e.	upon notice to Lessee, refuse to fund any Schedule(s) pursuant to the Lease;

f.	declare any Lease or Leases immediately due and payable;

g.	refuse to deliver the Property to Lessee;

h.	declare immediately due and payable all amounts due or to become due hereunder for the full term of the Lease (including any renewal period or purchase options which Lessee has contracted to pay);

in its sole discretion, sell, re-lease or otherwise dispose of any or all of the Property covered under any Schedule, whether or not in Lessor’s possession, in a commercially reasonable manner at public or private sale with notice to Lessee (the parties agreeing that ten (10) days’ prior written notice shall constitute adequate notice of such sale), and in the event a court of competent jurisdiction or other governing authority shall determine that the Lease is not a “true lease” or is a lease intended as security or that Lessor (or its assigns) does not hold legal title to or is not the owner of the Property, apply the net proceeds of any such disposition, after deducting all costs incurred by Lessor in connection with such default, to the obligations of Lessee hereunder and under such Schedule, or retain any or all of the Property in full or partial satisfaction, as the case may be, with Lessee remaining liable for any deficiency. The sale, re-lease, or other disposition may, at Lessor’s sole option, be conducted at Lessee’s premises. Lessor may at its sole discretion recover from Lessee liquidated damages for the loss of a bargain and not as a penalty an amount equal to Lessor’s Damages;

without notice to Lessee, repossess, disable or demand Lessee to disable the Property wherever found, with or without legal process, and for this purpose Lessor and/or its agents or assigns may enter upon any premises of or under the control or jurisdiction of Lessee or any agent of Lessee, without liability for suit, action or other proceeding by Lessee (any damages occasioned by such repossession or disablement being hereby expressly waived by Lessee) and remove or disable the Property therefrom; Lessee further agrees on demand, to assemble the Property and make it available to Lessor at a place to be designated by Lessor;

k.	exercise any other right or remedy which may be available to it under the Uniform Commercial Code or PPSA or any other applicable law;

if Lessee breaches any of its obligations under Section 7e of this Master Lease Agreement with regard to Software, Lessee shall be liable to Lessor for additional damages in an amount equal to the original price paid by Lessor for the Software, and in addition, at Lessor’s option, Lessor shall be entitled to injunctive relief;

if Lessor determines, in its sole discretion, not to take possession of the Property, Lessor shall continue to be the owner of the Property and may, but is not obligated to, dispose of the Property by sale or otherwise, all of which determinations may be made by Lessor in its sole discretion and for its own account;

n.	a cancellation hereunder shall occur only upon notice by Lessor and only as to such items of Property as Lessor specifically elects to cancel and this Lease shall continue in full force and effect as to the remaining items, if any;

with or without terminating the Lease, and without waiving its right herein to repossess, recover, or sell the Property, recover the Stipulated Loss Value of the Property together with all accrued but unpaid late charges, interest, taxes, penalties, and any and all other sums due and owing under the Schedule as of the rent payment date immediately preceding the date of default;

With respect to any exercise by Lessor of its right to recover and/or dispose of any Property securing Lessee’s obligations under any Schedule, Lessee acknowledges and agrees as follows: (i) Lessor shall have no obligation, subject to the requirements of commercial reasonableness, to clean-up or otherwise prepare the Property for disposition; (ii) Lessor may comply with any applicable State, provincial or Federal law requirements in connection with any

Page 6 of 10

disposition of the Property, and any actions taken in connection therewith shall not be deemed to have adversely affected the commercial reasonableness of any disposition of such Property; (iii) Lessor may specifically disclaim any warranties of title or the like with respect to the disposition of the Property; (iv) if Lessor purchases any of the Property, Lessor may pay for the same by crediting some or all of Lessee’s obligations hereunder or under any Schedule; and (v) no right or remedy referred to in this Section is intended to be exclusive, but each shall be cumulative and shall be in addition to any other remedy referred to above or otherwise available at law or in equity, and may be exercised concurrently or separately from time to time;

(i) by notice to Lessee, declare any license agreement with respect to Software terminated, in which event the right and license of Lessee to use the Software shall immediately terminate, and Lessee shall thereupon cease all use of the Software and return all copies thereof to Lessor or original licensor; (ii) have access to and disable, or demand Lessee to disable the Software by any means deemed necessary by Lessor, including but not limited to disabling the computers, computer systems or other equipment which run and/or operate and/or are controlled by the Software, for which purposes Lessee hereby expressly consents to such access and disablement, promises to take no action that would prevent or interfere with Lessor’s ability to perform such access and disablement, and waives and releases any and all claims that it has or might otherwise have for any and all losses, damages, expenses, or other detriment that it might suffer as a result of such access and disablement; and (iii) Lessee agrees that the detriment which Lessor will suffer as a result of a breach by Lessee of the obligations contained in the Lease cannot be adequately compensated by monetary damages, and therefore Lessor shall be entitled to injunctive and other equitable relief to enforce the provisions of this Section 19q. LESSEE AGREES THAT LESSOR SHALL HAVE NO DUTY TO MITIGATE LESSOR’S DAMAGES UNDER ANY LEASE BY TAKING LEGAL ACTION TO RECOVER THE SOFTWARE FROM LESSEE OR ANY THIRD PARTY, OR TO DISPOSE OF THE SOFTWARE BY SALE, RE-LEASE OR OTHERWISE.

Lessor may exercise any and all rights and remedies available at law or in equity, including those available under the Uniform Commercial Code or PPSA. The rights and remedies afforded Lessor hereunder shall not be deemed to be exclusive, but shall be in addition to any rights or remedies provided by law. Lessor’s failure promptly to enforce any right or remedy hereunder shall not operate as a waiver of such right or remedy, and Lessor’s waiver of any default shall not constitute a waiver of any subsequent or other default. Lessor may accept late payments or partial payments of amounts due under the Lease and may delay enforcing any of Lessor’s rights or remedies hereunder without losing or waiving any of Lessor’s rights or remedies under the Lease.

In connection with Lessor’s exercise of any or all of the above-listed remedies, Lessor shall be entitled to recover all reasonable costs and expenses incurred by Lessor in the repossession, recovery, storage, repair, sale, re-lease or other disposition of the Property, or the termination or disabling of Software, including without limitation, reasonable attorney fees and costs incurred in connection therewith or otherwise resulting or arising from Lessee’s default, and any indemnity if then determinable, plus interest on all of the above until paid (before and after judgment) at the lesser of the rate of eighteen percent (18%) per annum or the highest rate permitted by law. In the event of involuntary repossession by Lessor through judicial proceedings, or through a sheriff’s levy and sale, Lessee hereby waives any requirement that Lessor post a bond.

SECTION 20. ADDITIONAL PROVISIONS:

Security Interest . The parties acknowledge and agree that this is a “true lease” and title to the leased Property (or Lessee’s interest in the Property if the Property is Software) is vested in the Lessor. In the event a court of competent jurisdiction or other governing authority shall determine that the Lease is not a “true lease” or is a lease intended as security or that Lessor (or its assigns) does not hold legal title to or is not the owner of the Property, the following shall apply:

Effective the execution date of the Lease, Lessee, as debtor, grants a security interest to Lessor, as secured party, in the Property (or Lessee’s interest in the Property if the Property is Software), including but not limited to equipment and other personal property, general intangibles, Software and Lessee’s license rights and other rights to use the Software, and accessions thereto, and any refunds, rebates, remittances, and all rights and services related thereto, and proceeds of any of the foregoing, all in relation to the Property, to secure all duties and obligations of Lessee under any Lease or other agreement with Lessor. The Lease shall be deemed to be a security agreement with Lessee having granted to Lessor a security interest in the Property, and the Property shall secure all duties and obligations of Lessee under any Lease or other agreement with Lessor. With regard to any security interest created hereunder in any of the Property, Lessee consents and agrees that Lessor shall have all of the rights, privileges and remedies of a secured party under the Utah Uniform Commercial Code or PPSA.

Lessee authorizes Lessor to file financing statements and any records describing the Property and to take any and all actions necessary to perfect Lessor’s interest in the Property. Lessor agrees to amend any such financing statement within 3 days of a request by Lessee if the collateral description includes items not within the applicable Property description. Lessee agrees to execute any further documents, and to take any further actions, reasonably requested by Lessor to evidence or perfect the security interest granted under this subpart of the Lease, to maintain the first priority of the security interests, or to effectuate the rights granted to Lessor under this subpart of the Lease.

Entire Agreement . Each Schedule shall incorporate the terms and conditions of this Master Lease Agreement and, together with the Acceptance and Delivery Certificate and Master Progress Payment Agreement (and Certificates thereunder), if applicable, Transaction Documents, and any amendments to any of the foregoing documents, shall supersede all prior communications, representations, agreements, and understandings, including but not limited to offer letters, proposal letters, comfort letters, commitment letters and the like, and constitute the entire understanding and agreement between the Lessor and Lessee with regard to the subject matter hereof and thereof, and there is no understanding or agreement, oral or written, which is not set forth herein or therein. In the event of conflict between the provisions of this Master Lease Agreement and any Schedule, the provisions of the Schedule shall govern.

c.	Time Is of the Essence . Time is of the essence with respect to any Lease.

d.	Captions . Captions and section headings are inserted for reference and convenience only and in no way define, limit or describe the scope of this agreement or intent of any provision.

Governing Law . THIS LEASE (AS DEFINED IN SECTION 22 HEREIN) SHALL IN ALL RESPECTS BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF UTAH, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE. THE PARTIES AGREE TO SUBMIT TO THE EXCLUSIVE JURISDICTION OF THE STATE OF UTAH; ANY SUIT OR OTHER PROCEEDING BROUGHT BY EITHER PARTY TO ENFORCE OR CONSTRUE THIS LEASE (AS DEFINED IN SECTION 22 HEREIN), OR TO DETERMINE MATTERS RELATING TO THE PROPERTY OR THE RELATIONSHIP BETWEEN THE PARTIES HERETO SHALL BE BROUGHT ONLY IN THE STATE OR FEDERAL COURTS IN THE STATE OF UTAH. THIS LEASE WAS EXECUTED IN THE STATE OF UTAH (BY THE LESSOR HAVING COUNTERSIGNED IT IN UTAH) AND IS TO BE PERFORMED IN THE STATE OF UTAH (BY REASON OF ONE OR MORE PAYMENTS REQUIRED TO BE MADE TO LESSOR IN UTAH).

f.	Waiver of Trial by Jury . Lessor and Lessee hereby waive the right to trial by jury of any matters arising out of the Lease or Property or the conduct of the relationship between Lessor and Lessee.

Page 7 of 10

g.	Severability . Should any term or provision of this Agreement be declared invalid, illegal, void or unenforceable, all remaining terms and provisions hereof will remain in full force and effect and will in no way be invalidated or affected thereby.

Binding Effect; Survivability . The provisions of each Lease shall inure to the benefit of and shall bind Lessor and Lessee and their respective permitted successors and assigns. All representations, warranties, covenants and indemnities of Lessee made or agreed to in the Lease or in any certificates delivered in connection therewith shall survive the expiration, termination or cancellation of the Lease for any reason.

i.	Waiver . A waiver by either Party of any term or condition of this agreement in any instance shall not be deemed or construed to be a waiver of such term or condition for the future, or any subsequent breach thereof.

j.	Limitations . No paragraph, clause or phrase of this agreement shall limit, infringe, deny, negate, refuse or render void any other paragraph, clause or phrase of this agreement.

Financial Statements . Lessee, and any guarantor, shall provide to Lessor a copy of its annual audited financial statements within one hundred twenty (120) days after its fiscal year end, and a copy of its quarterly unaudited financial statements within sixty (60) days after the end of its first six-month period.

Acceptance and Delivery Certificate . If Lessee fails to sign and deliver an Acceptance and Delivery Certificate, then except as otherwise provided in Section 8c hereof, the Date of Acceptance shall be a date determined by Lessor which shall be no sooner than the date Lessee receives substantially all of the Property.

m.	Covenant of Quiet Possession . Lessor agrees that so long as no Event of Default has occurred and is continuing, Lessee shall be entitled to quietly possess the Property subject to and in accordance with the terms and conditions of this Master Lease Agreement.

Lessee’s Options at Maturity of Base Period . At the end of the Base Period of any Schedule, unless otherwise provided in the Schedule, the Schedule shall automatically renew for twelve (12) additional months at the rate specified on the respective Schedule. Unless otherwise provided in the Schedule and provided that Lessee gives written notice to Lessor, by certified mail or commercial over-night courier, received by Lessor at least ninety (90) days prior to the end of the Base Period of any Schedule, Lessee shall have the right to exercise any one of the following options: (1) purchase the Property for a price to be determined by Lessor and Lessee, unless such price is specified in the Schedule, or (2), or terminate the Schedule and return the Property to Lessor at Lessee’s expense to a destination within the continental United States specified by Lessor; provided, however, that for option (2) to apply, all accrued but unpaid late charges, interest, taxes, penalties, and any and all other sums due and owing under the Schedule must first be paid in full, the provisions of Sections 8f, 8g and 7d hereof must be specifically complied with, and Lessee must enter into a new Schedule with Lessor to lease Property which replaces the Property listed on the old Schedule. With respect to options (1) and (2), each party shall have the right in its absolute and sole discretion to accept or reject any terms of purchase or of any new Schedule, as applicable. In the event Lessor and Lessee have not agreed to either option (1) or (2) prior to the maturity of the Base Period, or if Lessee fails to give written notice via certified mail or commercial over-night courier at least ninety (90) days prior to the maturity of the Base Period of its intent to exercise either option (1) or (2), or if an Event of Default has occurred under any Schedule, then options (1) and (2) shall expire and the Schedule shall automatically renew as provided herein. At the maturity of the initial twelve (12) month renewal period provided above, the Schedule shall continue in effect at the rate specified in the respective Schedule for successive periods of six (6) months, each subject to termination at the maturity of any such successive six-month renewal period by either Lessor or Lessee giving to the other party at least thirty (30) days prior written notice of termination. LESSEE ACKNOWLEDGES AND AGREES THAT IT HAS READ AND UNDERSTANDS THE FOREGOING

PROVISIONS AND HAS HAD THE OPPORTUNITY TO DISCUSS THEM WITH LESSOR AND/OR ITS COUNSEL, SHOULD IT SO DESIRE. In the event of a disagreement between the parties in the interpretation of any provision of this Section 20(n), the parties agree that the ambiguity shall not be interpreted for or against either party upon grounds of authorship. This Section 20(n) shall supersede all prior communications, representations, agreements and understandings, including but not limited to offer letters, proposal letters, comfort letters, commitment letters, emails and the like and constitutes the entire understanding and agreement between Lessor and Lessee with regard to the subject matter of this Section 20(n), and THERE IS NO UNDERSTANDING OR AGREEMENT, ORAL OR WRITTEN, WHICH IS NOT SET FORTH HEREIN; provided, however, that in the event of a conflict between the provisions of this Section 20(n) and any Schedule, the provisions of the Schedule shall govern.

Initials:

Notices . Notices or demands required to be given herein shall be in writing and addressed to the other party at the address herein or such other address provided by written notice hereunder and shall be effective (i) upon the next business day if sent by guaranteed overnight express service; (ii) on the same day if personally delivered; or (iii) three days after mailing if sent by certified or registered U.S. mail, postage prepaid.

Further Assurances; Financing Statements . Lessee will cooperate with Lessor in protecting Lessor’s interests in the Property, the Lease and the amounts due under the Lease, including, without limitation, the execution (or other authentication), and delivery of Uniform Commercial Code statements, or similar filings under the PPSA, records and filings, patent and copyright registration documents with respect to proprietary Software (if applicable), and other documents requested by Lessor. Lessee will promptly execute, or otherwise authenticate, and deliver to Lessor such further documents, instruments, assurances and other records, and take such further action as Lessor may reasonably request in order to carry out the intent and purpose of this Lease and to establish and protect the rights and remedies created or intended to be created in favor of Lessor under this Lease. Upon written authorization from Lessee, Lessor may file UCC-1 financing statements, or similar filings under the PPSA, as applicable, fixture filings, real property waivers, and all other filings and recordings, as may be deemed necessary by Lessor. As provided above, Lessor agrees to amend any such financing statement within 3 days of a request by Lessee if the collateral description includes items not within the applicable Property description. Upon written authorization from Lessee, Lessee authorizes and/or ratifies the filing of any UCC-1 financing statements by Lessor before or after the execution of this Lease. Lessee shall pay all costs of filing any financing amendment, continuation and termination statements with respect to the Property and Lease, including without limitation, any intangibles tax, documentary stamp tax or other similar taxes or charges relating thereto and all costs of UCC or other lien searches and of obtaining and filing any full or partial third-party releases deemed necessary or advisable by Lessor. Lessee will do whatever may be necessary or advisable to have a statement of the interest of Lessor in the Property noted on any certificate of title relating to the Property and will deposit said certificate with Lessor. Lessee will execute, or otherwise authenticate, and deliver to Lessor such other documents, records and written assurances and take such further action as Lessor may reasonably request to more fully carry out the implementation, effectuation, confirmation and perfection of the Lease and any rights of Lessor thereunder. Lessee grants to Lessor a security interest in all deposits and other property transferred or pledged to Lessor hereunder to secure the payment and performance of all of Lessee’s obligations under the Lease. Lessor is authorized to take any measures necessary to protect its interest in the Property.

In the event the Property is in the possession of a third party, Lessee will join with Lessor in notifying the third party of Lessor’s interest in the Property and obtaining an acknowledgment from the third party that the third party is holding the Property for the benefit of Lessor.

Page 8 of 10

Lessor’s Right to Perform for Lessee . If Lessee fails to perform or comply with any of its agreements contained herein, Lessor may perform or comply with such agreements and the amount of any payments and expenses of Lessor reasonably incurred in connection with such performance or compliance (including attorney fees), together with interest thereon at the lesser of the rate of eighteen percent (18%) per annum, or the highest rate permitted by law shall be deemed additional rent payable by Lessee upon demand.

Counterparts; Chattel Paper . This Lease may be executed in any number of counterparts and by different parties hereto or thereto on separate counterparts, each of which, when so executed or otherwise authenticated and delivered, shall be an original, but all such counterparts shall together consist of but one and the same instrument; provided, however, that to the extent that this Lease and/or the Schedule(s) would constitute chattel paper, as such term is defined in the Uniform Commercial Code or PPSA as in effect in any applicable jurisdiction, no security interest herein or therein may be created or perfected through the transfer or possession of this Lease in and of itself without the transfer or possession or control, as applicable, of the original counterpart of such Schedule(s) identified as the document or record (as applicable) marked “Original”, and all other counterparts shall be marked “Duplicate Original” or “Counterpart”.

Joint and Several Liability . In the event two or more parties execute this Master Lease Agreement as Lessee, each party shall be jointly and severally liable for all Lessee representations, warranties, and obligations (including without limitation, payment obligations) under this Master Lease Agreement or under any Schedule or other document executed in connection herewith. Any and all representations, agreements, or actions by one Lessee shall be binding on all other Lessees.

Legal Fees and Other Costs . Lessee shall reimburse Lessor for all reasonable legal fees and additional charges, costs and expenses incurred by Lessor: (i) in defending or protecting its interest in the Property; (ii) in the enforcement of the Lease or the collection of any rent or other payments due under the Lease, or the preparation of any amendments or settlement agreements prepared in connection with the enforcement of the Lease or collection of any rent or other payments due under the Lease; and (iii) in any lawsuit or other legal or arbitration/mediation proceeding to which the Lease gives rise, including without limitation; actions in tort. Lessee shall pay applicable legal fees at the rate of no more than $350.00 per hour. Lessee shall pay a documentation fee calculated at .15% of the total cost of property with a minimum of $750.00 and a maximum of $7,500.00 for each Schedule.

Amendment and Modification . The Lease may not be amended or modified except by a written amendment executed by a duly authorized representative of each party, but no such amendment or modification needs further consideration to be binding. Notwithstanding the foregoing, Lessee authorizes Lessor to amend any Schedule to identify more accurately the Property (including, without limitation, supplying serial numbers or other identifying data), and such amendment shall be binding on Lessor and Lessee unless Lessee objects thereto in writing within ten (10) days after receiving notice of the amendment from Lessor.

Unauthorized Distribution of Lease Documents Prohibited . Lessee agrees that it will not, through any of its actions or omissions, cause any document or any portion of any document, associated with any Lease to be delivered, distributed, or otherwise fall into the possession of anyone not employed by Lessee on a full time basis, without the written consent of Lessor, except for Lessee’s auditors, consultants, attorneys or any individual, company or entity as required by applicable law. Lessee further acknowledges that any such unauthorized delivery or distribution could cause Lessor to suffer irreparable economic harm.

w.	Change in Lessee’s Name, Address and Jurisdiction . Lessee shall notify Lessor or its assigns in writing at least thirty (30) days in advance prior to changing its name, chief executive office address, or jurisdiction of organization from that set forth above.

SECTION 21. Intentionally deleted.

SECTION 22. DEFINITIONS

All capitalized terms not defined herein are defined in the Schedule.

“Acceptance and Delivery Certificate” means, any acceptance and delivery certificate, executed by the Lessee in connection with a Schedule, a Master Progress Payment Agreement, if any, and this Master Lease Agreement whereby the Lessee acknowledges that the items of Property to be leased have been delivered, received, installed, examined and tested and determined by Lessee to be satisfactory.

b.	“Base Period” means, the period of any Lease referred to as such on the related Schedule under this Master Lease Agreement.

c.	“Certificate” means, an Acceptance and Delivery and Approval for Progress Payment Certificate executed by the Lessee in connection with a Schedule, a Master Progress Payment Agreement and this Master Lease Agreement.

d.	“Date of Acceptance” means, except as otherwise provided in Section 8c of this Master Lease Agreement, the date Lessee accepts the Property designated on any Schedule, as set forth in any Acceptance and Delivery Certificate executed by the Lessee in form provided by Lessor.

“Lease Commencement Date” means, as to the Property designated on any Schedule, where the Date of Acceptance for such Schedule falls on the first day of a calendar quarter, that date, and in any other case, the first day of the calendar quarter following the calendar quarter in which such Date of Acceptance falls.

“Lease” means, a Schedule incorporating the terms of this Master Lease Agreement, together with the related Master Progress Payment Agreement, if any, Stipulated Loss Schedule, Acceptance and Delivery Certificate, UCC financing statements, or similar filings under the PPSA, and all other supporting documentation related thereto.

g.	“Lessor’s Damages” means, the Stipulated Loss Value together with costs, expenses, attorney’s fees, interest, and any determinable indemnity owed by Lessee to Lessor hereunder.

“Master Progress Payment Agreement” means, an agreement under which (i) Lessee accepts items of Property by signing a Certificate , (ii) Lessor agrees to purchase said items or Property, and (iii) Lessee agrees to pay service charges, all prior to the Date of Acceptance of all Property under the Schedule.

i.	“Monthly Rental” means, the monthly rental, together with sales tax and other amounts, if applicable, referred to as such on the related Schedule under this Master Lease Agreement.

“Property” means, equipment and other property, together with all related software whether embedded therein or otherwise, with all attachments, replacements, parts, substitutions, additions, repairs, accessions and accessories, incorporated therein and/or affixed thereto described in any Lease Schedule to be executed and delivered by Lessor and Lessee in connection with this Master Lease Agreement.

k.	“Schedule” means, any Lease Schedule to be executed and delivered by Lessor and Lessee under this Master Lease Agreement, which Schedule states the terms and other information associated with the Schedule and describes the leased Property.

l.	“Software” means, any computer program and supporting data, including all documentation, later versions, updates, upgrades and modifications, provided and/or described in any Lease Schedule to be executed and delivered by Lessor and Lessee in connection with this Master Lease Agreement.

Page 9 of 10

m.	“Stipulated Loss Schedule” means, Schedule of Stipulated Loss Values relating to a specific Schedule under this Master Lease Agreement.

n.	“Transaction Documents” means the Master Lease Agreement, Master Progress Payment Agreement, Lease(s), Schedule(s), Acceptance and Delivery Certificate(s), Certificate(s), sale

leaseback agreement(s), bill(s) of sale, guaranty agreement(s) executed on behalf of Lessee in favor of Lessor, and any other document entered into by lessee or any guarantor pursuant to the foregoing, together with any and all amendments, addendums, riders and exhibits thereto.

IN WITNESS WHEREOF, Lessor and Lessee have executed this Master Lease Agreement on the month, day and year first above written.


LESSOR:		LESSEE:

ONSET FINANCIAL, INC.		BIRKS GROUP INC.

BY:	/s/ Chantelle Brady	BY:	/s/ Pasquale (Pat) Di Lillo
	Chantelle Brady		Pasquale (Pat) Di Lillo
TITLE:	Senior Vice President	TITLE:	VP - CFAO

		LESSEE:

		MAYOR’S JEWELERS OF FLORIDA, INC.

		BY:	/s/ Pasquale (Pat) Di Lillo
			Pasquale (Pat) Di Lillo
		TITLE:	VP - CFAO

Page 10 of 10

EXHIBIT 99.2

AGREEMENT OF PRINCIPAL LEASE


BETWEEN:		7739907 CANADA INC. , a legal person duly incorporated, having its head office at 925 Grande Allée West, Suite 300, Quebec City, Province of Quebec, G1S 1C1, herein acting through its representatives duly authorized as they declare.

		(hereinafter called the « Lessor »)

AND:		BIRKS GROUP INC. , a legal person duly incorporated, having its head office at 1240, Phillips-Square Street, Montreal, Province of Quebec, H3B 3H4, herein acting through it representative, Jean-Christophe Bédos, President & CEO, duly authorized as he declares.

		(hereinafter called the « Lessee »)

IT IS AGREED:

SECTION 1 - DESCRIPTION OF PREMISES

1.1 The useable area as well as the rentable area of the Building and the 2 ^nd Floor Premises (as hereinafter defined), as well as any additional space leased during the Term (as hereinafter defined), and any extension or renewal thereof, will be measured in accordance with the BOMA ANSI Z-65-1 1996 standard. Before the Occupancy Date (as herein defined), the Lessor, at its own cost, will provide the Lessee with a final certificate of measurement of the Premises (as hereinafter defined) prepared by a Quebec Land Surveyor establishing the useable and rentable area of the Premises and the Building (as herein defined).

The premises shall consist of: a portion of the currently existing 2 ^nd floor of the Building, facing south and completely fronting along de Maisonneuve Boulevard (the “2 ^nd Floor Premises ”) as well as one (1) enclosed space on the “Maisonneuve” level of the Building (the “Maisonneuve Floor Premises” ) ( 2 ^nd Floor Premises and Maisonneuve Floor Premises, collectively referred to as “Premises” as identified in Schedule “A” hereto ) . The parties recognize that the rentable area of the Maisonneuve Floor Premises will be 6,423 square feet and it will not be subject to the measurement hereinabove.

For information purposes, the following are estimated to be the rentable areas for the Premises:


2nd Floor Premises:		20,000 square feet approximately
Maisonneuve Floor Premises:		6,423 square feet

Total:		26,423 square feet approximately

The Premises are situated in the building bearing civic number 2020 Robert-Bourassa Boulevard, Montreal, (the “Building” ) constructed on lot number 1 514 389 of the Cadastre of the Province of Quebec, Registration Division of Montreal; the Building and the land surrounding it are collectively called the “Immovable”.

The Lessee declares that it has visited the Premises and is satisfied with their present state and condition, subject to the Lessor delivering the Premises to the Lessee in accordance with Section 9.1 herein. Upon the Lessor’s substantial completion of the Base Building (as defined in Schedule «B – Base Building» attached hereto) as certified by an architect’s certificate, the Lessee will have forty-five (45) days to inspect the Base Building (the “Inspection Period”). Prior to the expiration of the Inspection Period, the Lessee will deliver to the Lessor a list of deficiencies, if any, as they may pertain to the Base Building (the “Deficiencies”), and the Lessor will work diligently to correct said Deficiencies. Save and except for any latent defects, the Lessee will take possession of and accept delivery of the Premises and the Base Building from the Lessor, “as is – where is”, at the expiration of the Inspection Period, subject to the Lessor correcting any remaining Deficiencies therein.

SECTION 2 - TERM

2.1 Lessee’s Lease shall be for a period of 16 years ( the “Term”) , commencing on May 1 ^st , 2017 ( the “Commencement Date”) and shall extend through April 30 ^th , 2033 (the “Termination Date”) .


								Lessor		Lessee

Lessor shall provide Lessee with access to the Premises at no charge on January 15 ^th , 2017 (the “Occupancy Date”) . The period between the Occupancy Date and the Commencement Date shall be defined as the “Fixturing Period” .

Lessee shall carry out its initial leasehold improvements during the Fixturing Period. As soon as Lessee’s leasehold improvements are substantially completed, Lessee shall have the right to occupy the Premises and conduct its business therein at no cost until the Commencement Date save and except for daily cleaning cost in the Premises occupied, as well as the cost of electricity related to their occupancy, but not to Building systems.

2.2 Unless otherwise renewed as provided hereunder, this lease shall end automatically on the Termination Date without notice from either of the parties. If the Lessee continues to occupy the Premises at the expiry of the lease without having signed a new lease with the Lessor, such occupation shall not be interpreted as a renewal, extension or tacit prolongation of the lease. In the circumstances, the Lessor may exercise all recourses against the Lessee which a lessor has available by law or consider this refusal to leave the Premises to be a lease by the month, subject to all the conditions of the lease, except with respect to its term and the monthly Net Rent (as hereinafter defined) which shall be a factor of 150% the monthly Net Rent payable in the preceding year.

SECTION 3 - NET LEASE

3.1 The Lessee acknowledges that the Premises are leased on a net basis of return to the Lessor. The Lessor shall not be responsible for any costs, charges, expenses or other outlays of any nature whatsoever relating to the Immovable, the Premises and the contents thereof or the business carried on by the Lessee, except as otherwise specifically provided herein. Subject to the foregoing, the Lessee shall pay its proportionate share of all Operating Costs and Property Taxes and shall pay all costs incurred by the Lessee, contractually or legally, or paid by the Lessor on behalf of the Lessee with respect to the Premises (“ Other Costs ”).

3.2 Notwithstanding the foregoing, the Lessor reserves the right to convert the Lease to a gross lease for the Maisonneuve Floor Premises provided that the gross rent is not more than the sum of the Net Rent and the Additional Rent (as these terms are defined below) for the Maisonneuve Floor Premises as contained herein.

Net Rent and Additional Rent shall be referred to herein collectively as “ Rent ”.

SECTION 4 - RENT

4.1 Net rental rate for the 2 ^nd Floor Premises on an “as is” basis with Base Building completed by Lessor shall be as follows (the “ Net Rent ”):

NET RENT FOR 2 ^ND FLOOR PREMISES

From May 1, 2017 to April 30, 2022 : $17.00 per square foot per annum of rentable area;

From May 1, 2022 to April 30, 2024 : $18.50 per square foot per annum of rentable area;

From May 1, 2024 to April 30, 2027: $20.00 per square foot per annum of rentable area;

From May 1, 2027 to April 30, 2029: $21.50 per square foot per annum of rentable area;

From May 1, 2029 to April 30, 2033: $23.00 per square foot per annum of rentable area.

The exact amount to be paid by the Lessee as rent shall be adjusted upon confirmation of the rentable area of the 2 ^nd Floor Premises in accordance with the provisions of Section 1.1 hereof.

4.2 NET RENT FOR MAISONNEUVE FLOOR PREMISES

From May 1, 2017 to April 30, 2022 : $5.00 per square foot per annum of rentable area;

From May 1, 2022 to April 30, 2024 : $5.50 per square foot per annum of rentable area;

From May 1, 2024 to April 30, 2027: $6.00 per square foot per annum of rentable area;

From May 1, 2027 to April 30, 2029: $6.50 per square foot per annum of rentable area;

From May 1, 2029 to April 30, 2033: $7.00 per square foot per annum of rentable area.

The Net Rent for the Premises is payable in equal consecutive monthly instalments, each in advance on the first day of each calendar month. In the event that the first day of a month falls on a Saturday, Sunday or statutory holiday, payment of the installment of Net Rent for the Premises as provided for herein shall be due on the following day that is not a Saturday, Sunday or statutory holiday. The amount of each instalment which corresponds to a rental term less than one month shall be calculated in accordance with the number of days of occupancy.


								Lessor		Lessee

- 2 -

SECTION 5 - ADDITIONAL RENT

5.1 The Lessee’s proportionate share of all Operating Costs and Property Taxes as well as the Other Costs, which the Lessee pays hereunder, is additional rent (collectively “Additional Rent”). The Lessee’s proportionate share of all Operating Costs and Property Taxes shall be paid throughout the Term and any renewal or extension thereof. The Other Costs are payable on demand.

SECTION 6 - PAYMENT OF LESSEE’S PROPORTIONATE SHARE, PROPERTY TAXES AND OPERATING COSTS

6.1 Lessee’s Proportionate Share : subject to the final measurements as provided in Section 1.1 and to any ulterior modification to the total rentable area of the Building, the Lessee’s proportionate share is determined to be 5.18636 % and represents the fraction obtained by dividing the rentable area of the Premises by the total rentable area of the Building, including the area of the Premises, the common areas and the service areas but excluding the parking areas, that is, 509,471 square feet.

At the commencement of the lease, the Lessor shall evaluate the amount of the Lessee’s proportionate share of the Operating Costs and Property Taxes for the current calendar year and shall remit to the Lessee an estimate of the amount payable in advance, in equal monthly instalments on the first day of each month.

For the calendar year 2016, the Lessee’s proportionate share of the Property Taxes is estimated approximately at Eight Dollars and Fifteen Cents ($8.15) per square foot of the Premises and the Lessee’s proportionate share of the Operating Costs is Eleven Dollars and Forty-One Cents ($11.41) per square foot of the Premises.

Management and/or administration fees or costs shall be reasonable and within industry standards, shall not exceed 15% of the Building’s operating costs during the Term and shall not be charged on Property Taxes.

If the Lessor reasonably determines that such monthly instalments for the portion of the Property Taxes are not sufficient to pay such taxes when next due, the Lessee shall, on demand, pay the Lessor in advance a sufficient amount to make up the difference.

The Lessor shall provide an audited statement of the Operating Costs and Property Taxes no later than ninety (90) days after the end of each year. Lessee, acting reasonably, shall have the right to examine the Building’s books and records from time to time with an auditor of Lessee’s choosing who is a National firm accountant, to confirm the operating costs and property taxes, the whole at Lessee’s cost. Should Lessee’s audit reveal that Lessee has been overcharged by more than 3%, then Lessor shall reimburse the Lessee for the overage carrying an annual compounded interest rate of prime charged by the National Bank plus 3% and the cost of the audit.

6.2 Property Taxes : mean all taxes, rates, assessments, levies and impositions, general or special, to be collected or imposed, now or in the future, on the Immovable by the municipality, urban community, regional, county, municipality or school commission whether for public improvements or other purposes, as well as the Lessor’s tax on capital. However, Property Taxes do not include the Lessor’s federal and provincial income tax. If the tax system presently in force is changed or modified and any new tax or rate whatsoever is collected or imposed on the Immovable or even on their income whether in replacement of or in addition to all taxes presently collected or imposed on immovables, any new tax or contribution shall be included in the definition of «Property Taxes». If the competent authority decides to abolish a tax, rate, levy or imposition whatsoever which is a part of the Property Taxes, the Lessor shall remove it from the Property Taxes.

All expenses incurred by the Lessor in order to obtain or to attempt to obtain a decrease in the amount of Property Taxes shall be added to and included in the amount of Property Taxes. In the event of a reimbursement of Property Taxes after the Lessee has paid its proportionate share of Property Taxes, the Lessor shall remit to the Lessee its proportionate share of this reimbursement. However, a reduction in Property Taxes resulting from a vacancy in the Immovable for the preceding year shall be for the benefit of the Lessor and shall not be shared with the Lessee and the other lessees of the Immovable.

The proportionate share attributed by the municipality to the premises leased in the Immovable shall not serve as the basis for review of the Lessee’s proportionate share in Section 6.1.


								Lessor		Lessee

- 3 -

The Lessor is not obliged to contest the imposition of Property Taxes, the value inscribed on the role or the evaluation attributed to the Immovable or the Premises. The Lessor may settle, or otherwise resolve, all matters and things relating thereto. The Lessee may not itself, without the Lessor’s intervention, contest, oppose or litigate the levying of imposing of Property Taxes, the value inscribed on the role or the evaluation attributed to the Immovable or the Premises.

In the event that the tax authorities directly impute part of the Property Taxes to the Premises or to the improvements therein, the Lessee shall pay them in addition to its proportionate share of the Property Taxes. Any amount directly imputed by the authorities to other premises or leasehold improvements in the Building shall be deducted from the Property Taxes.

The Lessor will not charge the Lessee for any taxes which are personal to the Lessor such as capital taxes, mutation duties, and taxes.

6.3 Operating Costs : mean all costs and expenses incurred by the Lessor, with respect to the operation, management, repair, replacement and maintenance of the Immovable, increased by a management and/or administration fee equivalent to not more than 15% of such Operating Costs. Such operating, management, repair, replacement and maintenance costs and expenses, among other things, include the following items:

•

cleaning;

•

electrical systems;

•

heating, ventilation and air-conditioning;

•

vertical transportation;

•

general expenses;

•

security and surveillance;

•

administration;

•

energy (excluding electricity charged to the Lessee pursuant to section 10.2 hereof);

•

insurance.

Operating Costs will not include initial capital cost of constructing or acquiring the Building, the cost of capital improvements or repairs, any cost associated with laws or additional taxes attributable to the sale or refinancing of the Building and any costs, changes, impositions, expenses and outlays listed below:

During the Term and any extension or renewal thereof, no expenses incurred for the following items shall be included in Operating Costs:

Costs of decorating, redecorating or special cleaning or other services not provided on a regular basis to lessees of office space in the Building;

ii.

Wages, salaries, fees and fringe benefits paid to administrative or executive personnel not directly involved with the Building, or officers or partners of Lessor;

iii.

Any charge for depreciation of the Building and financing on the Building;

iv.

Any charge for Lessor’s income taxes, excess profit taxes, franchise taxes or similar taxes on Lessor’s business;

All costs relating to activities for the solicitation and execution of and enforcement of disputes involving leases for other space in the Building;

vi.

Any compensation paid to clerks, attendants or other persons in commercial concessions operated by Lessor;

vii.

All costs for which Lessee or any other lessee in the Building is being charged, other than under lease provisions analogous to the paragraph of this LOI entitled property taxes, operating costs and other charges;

viii.

Lessor’s cost of electricity and other services and materials furnished to other lessees in the Building and for which Lessor is entitled to be reimbursed by such lessees as an additional charge or rental over and above the net rent payable under the lease with such lessee;


								Lessor		Lessee

- 4 -

ix.

The cost of correcting defects in the construction of the Building or in Building electro-mechanical equipment;

The cost of any repair made by Lessor because of the total or partial destruction of the Building or the expropriation of the Building or a portion of the Building;

xi.

Any operating costs representing an amount paid to a Lessor - related corporation, entity or person which is in excess of the amount which would be paid in the absence of such relationship;

xii.

The cost of tools and equipment used initially in the construction of the Building;

xiii.

The cost of any work or service performed for or facilities furnished to any lessee of the Building to a greater extent or in a manner more favorable to such lessee than that to which Lessee is entitled;

xiv.

The cost of alterations of space in the Building leased to other lessees;

xv.

Marketing costs, including lessee appreciation functions;

xvi.

Lessor’s general corporate overhead general administrative expenses not specifically incurred in the operation, management or administration of the Building;

xvii.

Marketing costs and commission and fees paid on the leasing of the Building;

xviii.

Repairs and replacements to the structure;

xix.

Replacements to the foundation, the roof, the windows and the outside walls of the Building;

xx.

Any bad debt loss, rent loss or reserves therefore;

xxi.

Fine, penalties and interest;

xxii.

Charitable contributions of Lessor; and

xxiii.

Costs incurred to comply with laws applicable on the date of the lease.

Lessor warrants that operating costs will be incurred on a reasonable basis and be in line with similar office buildings downtown Montreal.

In order to determine the Additional Rent, any expense included in the Operating Costs which is of a capital nature shall be amortized in conformity with generally accepted accounting principles consistently applied (“GAAP”).

SECTION 7 - OTHER TAXES

7.1 The Lessee shall pay when due all water, business or other similar taxes and rates imposed or to be imposed on the Premises or on the business carried on therein. The Lessee shall also pay all other taxes and rates which the Lessee is called upon to pay as lessee or occupant of the Premises. The Lessor shall only pay such taxes in either of the following events and then the Lessee, on demand, shall reimburse the Lessor for them as well as for any benefit derived therefrom by the Lessee:

7.1.1

if by operation of the law, a regulation or otherwise, the owner or the Lessor becomes responsible for the payment or collection of such taxes; or

7.1.2

if a single account includes all taxes concerning the Immovable corresponding to a greater area than that occupied by the Lessee.

7.2 In addition to the Rent, the Lessee shall pay to the Lessor, at the same due dates, the amount of all taxes imposed on such Rent and which the Lessor is obliged to collect, in particular the GST and QST.


								Lessor		Lessee

- 5 -

SECTION 8 - USE OF PREMISES

8.1 The 2nd Floor Premises shall be used only for general office purposes and all functions relating to office use. Lessee will specifically have the right to install one or more kitchens for the preparation and service of food, for its own use and use by invitees only, and not for sale to the general public, and to equip each such kitchen with, amongst other things, a dishwasher, a refrigerator, a stove and a microwave.

The Maisonneuve Floor Premises shall be used for a distribution center, vault area, light assembly and repair of watches and jewellery and general office space in support of these activities.

They shall not be used for any other purpose unless the Lessee has obtained the Lessor’s written approval.

8.2 Lessee shall not be obliged to physically occupy the Premises, provided that it respects all of the terms and conditions of its Lease, which will not be irreconcilable with the non-occupation of the Premises.

8.3 The Lessee has taken all steps and has verified with the municipality to ensure that the above-mentioned usage is permitted, which the Lessee shall confirm to the Lessor. The Lessee undertakes to obtain and maintain in force any permit required for such purpose. On demand, the Lessee shall remit copies to the Lessor.

SECTION 9 - CONDITION OF PREMISES

9.1 The Premises shall be delivered by the Lessor to the Lessee in the condition described in Schedule «B – Base Building» attached hereto. All work or improvements done to the Premises other than those described in Schedule «B» are the Lessee’s responsibility and shall be done at its expense and in conformity with Section 16 herein.

9.2 The following shall apply at any time after the date of signature of the Lease and shall apply to the initial improvements as well as any improvements or alterations in the Premises during the Term or any renewal thereof:

Lessee shall construct all leasehold improvements in the Premises and Lessee shall have the right at all times to make alterations in the Premises (collectively “ Leasehold Improvements ”).

ii.

With the exception of any cosmetic, aesthetic or decoration work to the Premises, the Lessee will submit to the Lessor its plans and specifications of any work or improvements to be done within the Premises, for Lessor’s prior approval, which shall not be unreasonably withheld or delayed, time being of the essence.

iii.

Subject to the Lessor’s prior written approval, which shall not be unreasonably withheld or delayed, the Lessee shall have the right to hire the general contractor as well as any subcontractor of its choice, provided they are properly licensed, have sufficient insurance, make the Lessor a co-insured along with the Lessee, and Lender, if necessary, and provide waivers of lien prior to final payment of the holdback in each instance. Subject to Section 9.2 (ii) herein, the engineers must first be approved in writing by Lessor, acting reasonably.

9.3 Lessor shall provide the Lessee with an allowance in order to perform all non Base Building initial leasehold improvements in the Premises, the “Initial Leasehold Improvements”, an amount of $40.00 per square foot of rentable area for the 2 ^nd Floor Premises and an additional $15.00 per square foot of rentable area will be provided for the Maisonneuve Floor Premises, plus applicable sales taxes (collectively, the “Lessee’s Allowance”) . Lessee’s Allowance may also be used for Lessee’s design fees, professional fees, cabling, moving expense, permits, and furniture, fixtures and equipment. The Lessee’s Allowance shall be paid by the Lessor to the Lessee upon presentation of invoices for materials, fees and/or work completed, on a draw basis, within 15 calendar days from the date of submittal by Lessee, or its representative, without setoff or deduction, and including applicable sales taxes.

9.4 Lessor shall not charge any oversight fees, management fees or supervision fees of any nature whatsoever on the Initial Leasehold Improvements made before September 30, 2017 and not more than 15% in total on the costs incurred by the Lessor on improvements made thereafter. Lessee shall not be charged for any electrical services, water, freight elevator, or loading dock use, or any other services during the construction of the Initial Leasehold Improvements.


								Lessor		Lessee

- 6 -

9.5 At all times after signature of the Lease, as well as at all times during the Term or any extension or renewal thereof, Lessee will not be charged for any elevator service, supervision, guard service or cleaning for its move-in and move-out.

9.6 Lessor shall maintain and provide all services to the Building and the Premises including without limitation HVAC, utilities, vertical transportation, telephone, internet and cable access, security, janitorial, window washing, repairs, replacements and maintenance consistent with other class A buildings located within the Central Business District of Montreal. Costs for such services are included within Operating Costs of the Building.

Fresh air levels in the Premises shall be maintained in accordance with current ASHRAE standards on a basis of 1 person per 150 square feet.

SECTION 10 - SERVICES AND UTILITIES

10.1 The Lessor shall provide the Lessee, to the extent that the Lessor is able to obtain from its main suppliers (in particular, with respect to electricity), the following services and utilities:

•

electricity (lighting and energy) for common areas and services areas;

•

heating;

•

air-conditioning;

•

cleaning;

•

washrooms;

•

passenger elevators.

The cost of such services is included in the Operating Costs. All services required or used by the Lessee to meet its special needs and which are not in conformity with the usual standards of the Building are the Lessee’s responsibility. The Lessor may, at the Lessee’s expense, supervise and install any apparatus which permits checking additional consumption or use of the services and utilities. The Lessee shall pay any amount attributable to the excess consumption or use.

10.2 Lessor (subject to its ability to obtain the same from its principal supplier) will cause the Premises to be supplied with electric current for the lighting and power required therein for the operation of Lessee’s reasonable needs, which current Lessee hereby agrees to take and receive from Lessor. For the said electricity, Lessee shall pay as Additional Rent an amount calculated at the rate of One Dollar and Ten Cents ($1.10) per square foot of rentable area per annum in equal, consecutive, monthly instalments in advance. The foregoing annual amount and the monthly instalments shall not exceed that which would have been charged to the Tenant directly by Hydro Quebec, had it been separately metered (including all applicable sales taxes), after the 1 ^st day of May, 2017. The obligation of Lessor hereunder shall be subject to any rules or regulations to the contrary of Hydro-Quebec or any other municipal or governmental authority.

In the event any special lighting (above Building standard) or equipment (including but not limited to, special heating, ventilating, air-conditioning systems, printing presses, computers and the like) is installed in the Premises or in any other event where there is reason to believe that excess electricity is being consumed in the Premises, Lessor shall have the right to survey or meter at Lessee’s expense, the total electrical consumption and Lessee shall pay for any excess disclosed by said survey or metering by appropriate increases in the aforementioned monthly instalments.

10.3 If, due to any act, omission or negligence of the Lessor, any of the critical services of the Building (HVAC, electricity, water, elevators) or access is interrupted for more than 3 consecutive days, then Lessee shall have the right to cease its paying of Net Rent and Additional Rent owed under the Lease, beginning with the day of interruption prorated until such service or services or access is reinstated.

10.4 Should the Lessor have an emergency generator for Lessee’s use during power outages, Lessor will allow Lessee during the Term or renewal thereof, to connect to the generator, if it so wishes, at no additional charge and provide power capacity to the Premises proportional to other lessees in the Building and subject to the capacity of the generator.

10.5 During the Term or any renewal thereof, Lessee shall have the right to install and maintain a satellite dish and antenna at no cost to Lessee, save and except for installation and maintenance costs, all in accordance with Lessor’s permission as to location, method of installation, and permits. The Lessee will be responsible to pay for any direct damages resulting from the installation, operation and removal of such satellite dish and antenna.


								Lessor		Lessee

- 7 -

SECTION 11 - PARKING

11.1 During the Term, or any extension or renewal thereof, and during the Fixturing Period, the Lessor will provide Lessee with up to 10 indoor parking spaces in the Building on a non reserved basis and up to 2 reserved indoor parking spaces. Lessee may increase or decrease its requirements up to the levels provided for herein on a monthly basis. Should Lessee expand its Premises, Lessor will provide 1 indoor parking space for each additional 2,500 square feet of rentable area leased during the Term or any extension or renewal thereof.

The Lessor determines the rent for parking spaces on an annual basis. A written notice of the determined monthly rent shall be sent to the Lessee at least thirty (30) days prior to the start of the new lease year. For the Calendar Year 2016, such rent per non reserved parking space is $310.00 per month (plus applicable taxes) and such rent per reserved parking space is $395.00 per month (plus applicable taxes). The Lessee shall never be required to pay any more than Lessor’s standard asking rates for other lessees in the Building at any time during the Term or any extension or renewal thereof.

SECTION 12 - EXTERIOR SIGNAGE

12.1 Lessor grants to the Lessee the right to place its corporate logo on the façade of the Building facing Maisonneuve West Boulevard. The exact location of the logo and the size shall be determined in order to achieve pedestrian visibility at street level on de Maisonneuve West Boulevard, subject to Lessor approval, not to be unreasonably withheld.

Lessee will be permitted to install its sign after having first obtained Landlord’s approval (acting reasonably), and subsequently, all necessary authorizations from the municipal authorities of the specifications, design criteria, drawings, exact location and methods of installation of its exterior signs. The Lessor shall provide the Lessor’s existing working drawings to the Lessee’s contractors in order to allow them to submit their drawings and specifications for municipal and Lessor’s approval. Lessee will install, maintain, repair and replace its exterior sign and remove it at the end of the Term, at its own cost and expense.

Lessee will not pay any rent or fee of any nature whatsoever to Lessor for the signage or its rights.

The signage rights are transferable to any sublessee or assignee.

SECTION 13 - GUARANTEE

13.1 On or before February 1, 2017, the Lessee shall provide the Lessor, an unconditional and irrevocable Letter of Credit as security against all of the Lessee’s obligations which may occur from time to time under the Lease, issued by a Canadian chartered bank, in the amount of E IGHT H UNDRED T HOUSAND D OLLARS ($800,000.00) to decrease by O NE H UNDRED T HOUSAND DOLLARS ($100,000.00) per annum on a declining basis as follows:

•

Seven Hundred Thousand Dollars ($700,000.00) for the period of May 1, 2019 to April 30, 2020;

•

Six Hundred Thousand Dollars ($600,000.00) for the period of May 1, 2020 to April 30, 2021;

•

Five Hundred Thousand Dollars ($500,000.00) for the period of May 1, 2021 to April 30, 2022;

•

Four Hundred Thousand Dollars ($400,000.00) for the period of May 1, 2022 to April 30, 2023;

•

Two Hundred Thousand Dollars ($200,000.00) for the period of May 1, 2023 to April 30, 2027.

SECTION 14 - ASSIGNMENT AND SUBLETTING

14.1 Lessee shall have the right to sublease or assign all or a portion of the Premises, with Lessor’s prior approval, which shall not be unreasonably withheld, conditioned or delayed. Notwithstanding the foregoing, Lessor’s written approval shall be given or not given, with its reasons as to why it is not granting approval, within 10 days from receipt of Lessee’s written request, failing which its approval will be deemed to have been given.


								Lessor		Lessee

- 8 -

Lessee shall have the right to sublease or assign all or a portion of the Premises without Lessor’s approval, in the following circumstances:

A successor to Lessee’s businesses if such succession takes place by a merger, consolidation, reorganization, act of legislature or otherwise, or

II.

Any affiliate of Lessee.

Lessee may sublet or assign to other lessee’s within the Building.

No fees shall be payable by Lessee to obtain Lessor’s consent.

Notwithstanding the assignment, subletting or use, Lessee will remain solidarily responsible with the assignee, sublessee, or user, without benefit of division or discussion, for the payment of Rent and the performance of all other obligations of Lessee under the Lease.

SECTION 15 - LESSEE’S OBLIGATIONS

15.1 The Lessee shall maintain the Premises, including all improvements therein in a good state of repair and in good condition. The Lessee shall make all needed lessee’s repairs. Subject to Section 16.2.4, at the expiry of the lease, the Lessee shall restore the Premises to a good state of repair and condition such as they were at the beginning of the lease, except for reasonable wear and tear. Should the Lessee fail to fulfil its obligations, the Lessor may, upon giving the Lessee a five (5)-day written notice, carry out the repair and maintenance work. All reasonable costs incurred by the Lessor shall be payable by the Lessee to the Lessor upon demand.

The Lessee shall advise the Lessor, without delay and in writing, of any defects in or damages to the Premises.

15.2 The Lessee shall not obstruct nor affect the proper functioning of the heating, air-conditioning, water, sewage and gas equipment, wash-rooms, drains and accessories in and about the Premises. It shall advise the Lessor, without delay and in writing, of any accident or defects in their proper functioning. The Lessee shall be solely responsible for damage to said systems, equipment, and accessories caused by its abuse or negligence.

15.3 The Lessee undertakes not to bring into or store in or about the Premises or the Building anything which is contrary to the fire, police and health and safety laws, orders, decrees and regulations of the municipality in which the Immovable is located, of the urban community (if such is the case), or any other government authority with jurisdiction over the Premises, the occupancy thereof or the business carried on by the Lessee in the Premises, nor permit such to be done.

15.4 Subject to Section 23.21, the Lessee shall not bring into or store in the Premises anything which could cause the insurance policies of the Lessor or of the other lessees of the Building to be cancelled. Subject to Section 23.21, no inflammable or explosive material of any kind whatsoever shall be brought into or stored in the Premises or the Building.

The Lessee shall pay, on demand, to the Lessor any additional insurance premiums required for insurance coverage subscribed for by the Lessor or by other lessees of the Immovable because of:

15.4.1

the activities carried on by the Lessee;

15.4.2

the items or objects which the Lessee keeps or stores in the Premises; or

15.4.3

the conduct of business by the Lessee.

15.5 The Lessee shall hold harmless and indemnify the Lessor against all:

15.5.1

penalty or damage imposed or suffered as a consequence of any breach of any law, order, decree or regulation whatsoever; and

15.5.2

liability including liability for personal injury or damage to property by or to the Lessee’s employees, agents, clients, visitors or licensees and claims, damages or expenses as a result of any act or omission.


								Lessor		Lessee

- 9 -

SECTION 16 - WORK

16.1 Building modifications

The Lessor may at any time, change, modify or expand the Building provided that such work pursuant to this Section 16.1 does not unreasonably interfere with the Lessee’s use and enjoyment of the Premises. For this purpose, the Lessor may, among other things, add floors to the Building, make it higher or wider or change or modify the location, size or specifications of pipes, wires, electrical or other lines, facilities, mechanical systems, common areas and other services in the Building (including those which may be situated in the Premises). Provided that the Lessee’s use of the Premises is not materially diminished, its business is not interfered with in more than a de minimus manner and the Lessor acts in accordance with the requirements of this Section 16.1, the Lessee waives all claims which might arise from such changes, modifications or expansion insofar as the dimensions of the Premises remain substantially the same. In the event that additional land is used for such changes or modifications or expansion, such additional land is deemed to be included within the definition of the word Immovable.

In the event such changes or modifications or expansion cause the rentable area of the Building to increase or decrease, the Lessee’s proportionate share, as defined in Section 6.1, shall be accordingly modified. Provided that the Lessee’s use of the Premises is not materially diminished, its business is not interfered with in more than a de minimus manner and the Lessor acts in accordance with the requirements of this Section 16.1, the Lessee shall not be entitled to any indemnity, rent reduction, damages or compensation whatsoever. Such work shall be completed by the Lessor with reasonable diligence.

16.2 Repairs or alterations to the Premises

16.2.1 General provisions

If the Lessee wishes to have repairs, improvements, additions or alterations done to the Premises, the Lessor’s consent must be obtained, which consent shall not be withheld without serious reason. In the event such repairs, improvements, additions or alterations may affect the structure of the Building or substantially diminish the value of the Immovable or harm the other lessees of the Building, this shall constitute a serious reason. Plans and specifications for the work shall be acceptable to both parties. The Lessee will not be required to obtain the Lessor’s consent pursuant to this Subsection 16.2.1 for any cosmetic, aesthetic or decoration work to the Premises.

All costs and expenses incurred, directly or indirectly, for such work pursuant to Subsection 16.2.1 are the responsibility of the Lessee, in particular:

(i)

the cost of the work;

(ii)

architects and engineer’s fees including the cost of plans and specifications prepared for the work requested by the Lessee; and

(iii)

the Lessor’s administration and coordination fee of not more than 15% in total of the costs incurred by the Lessor, referred to in sub-paragraphs (i) and (ii) of this Section 16.2.1.

Should the Lessor make a payment with respect to the work in order to protect its rights, the Lessee shall reimburse the Lessor on demand.

16.2.2 Additional provisions applicable when work is done by Lessor

In the event that the Lessor does not consent to the repairs, improvements, additions or alterations done to the Premises for a serious reason (in accordance with Section 16.2.1), and if the Lessor decides to do the work itself, it shall provide the Lessee within a reasonable delay, with a cost estimate for the work. Such estimate, however, shall not render the Lessor liable for any surplus costs or over-runs which are at the sole cost of the Lessee.

Prior to the commencement of the work, the Lessee shall pay the Lessor the amounts needed to pay for the work. Such amounts shall be kept as a pledge and shall be released as the work progresses. No interest shall be paid on such amounts to the Lessee.

If the Lessee decides not to do the work after having received the cost estimate from the Lessor, the Lessee shall pay the Lessor the cost for experts and the preparation of the estimate plus the Lessor’s administration and coordination fee of ten percent (10%) of such costs.


								Lessor		Lessee

- 10 -

16.2.3 Additional provisions applicable when work is done by Lessee

Prior to any step being taken with respect to the work to be performed by the Lessee pursuant to Subsection 16.2.1 herein, the Lessee shall provide to the satisfaction of the Lessor, acting reasonably, with evidence of its ability to pay the cost of the work to be undertaken.

No work shall be done by the Lessee unless:

(i)

the permits required by the appropriate public authorities have been obtained;

(ii)

the contractors whose services have been retained are solvent and recognized as competent;

(iii)

the mechanical, electrical and plumbing contractors are approved by the Lessor;

(iv)

the contractors would defray the cost of the additional services required in the Building during construction; and

(v)

the contractors have public liability insurance to the extent of five million dollars ($5,000,000.00).

The Lessor may require that any contractor who contravenes a collective agreement or a decree or causes a labour dispute in the Building be replaced, without delay and at the cost of the Lessee. Notwithstanding anything to the contrary herein, the Lessee will not be required to provide evidence of its ability to pay for work as provided in this Section 16.2.3, for any cosmetic, aesthetic or decoration work to the Premises.

16.2.4 Ownership of improvements

Any improvements, alterations, additions or repairs made in or to the Premises (including the installation of wall-to-wall carpet) shall form an integral part thereof and become the property of the Lessor with no compensation from the moment of completion of the work.

Provided Lessee has not been in material default of its Lease, at the end of the Term, or any extension or renewal thereof, or pursuant to any termination option the Lessee may exercise, the Lessee may, but shall have no obligation to remove its leasehold improvements from the Premises, whether those improvements were part of the Lessee’s initial improvements or not, Base Building or any other improvements made to the Premises, except for the vault area.

SECTION 17 - ACCESS TO PREMISES AND SECURTIY

17.1 The Lessor, its employees or representatives may, upon 24-hour written notice to Lessee or at any time in the event of an emergency, enter the Premises for the purposes stated in Section 16.1 and to inspect them, adjust the heating and air-conditioning system and for the other purposes deemed necessary for the proper operation and maintenance of the Premises or the equipment therein. The Lessee shall permit access during normal business hours to all persons who wish to rent the Premises or purchase the Immovable, as well as to any potential hypothecary creditor upon 24-hour written notice from the Lessor.

17.2 Lessee shall have access to the Building, the Premises, the retail, the metro (during its open hours only), and the parking on a 24/24, 7 days a week basis.

17.3 Lessee shall have the right to install a controlled access system for the Premises at its own cost. Lessee may connect to the Building controlled access system at its own cost.

During the Term, or any extension or renewal thereof, Lessor shall provide adequate security to Class A building standards including a 24 hour a day roving security that patrols the Building’s common areas and indoor parking.

SECTION 18 - FIRE AND DESTRUCTION

18.1 The Lessor shall not be obliged to repair or rebuild the Building or the Premises in the event that forty percent (40%) or more of the leasable area of the Building at any time during the Term and any renewal thereof is destroyed or damaged by fire, or other casualty insured against by the Landlord.

18.2 Subject to Section 18.1, if the Lessor decides not to repair or rebuild the Building or the Premises, the Lessor shall so advise the Lessee within ninety (90) days of the damage or destruction. In this event, the lease shall terminate immediately and the Lessee shall surrender the Premises even if they were not damaged and shall pay any amount of Rent due at the date of the damage or destruction.


								Lessor		Lessee

- 11 -

18.3 Subject to Section 18.1, should the Lessor decide to repair or rebuild the Building and the Premises, the Lessor shall do so in substantial conformity with what is represented in Schedule «B» as amended. All improvements to the Premises other than those set out in Schedule «B» are the responsibility of the Lessee who shall repair and re-equip the Premises to an extent at least equivalent to that existing prior to the damage or destruction. In this case, the Rent shall be reduced in proportion to the amount of time and space of which the Lessee is deprived of the Premises. In no event shall the Lessor be held liable for any damage or loss suffered by the Lessee which is caused by the damage or destruction except where such damage or loss results from the Lessor’s intentional or gross fault.

SECTION 19 - NON-LIABILITY OF LESSOR

19.1 The Lessor shall not be liable for damage to property or persons including bodily injury suffered by the Lessee, its employees, agents, clients, visitors or licensees in the Premises or the Building. The Lessee agrees to hold harmless and indemnify the Lessor against any loss, cost, claim or demand resulting therefrom. The Lessor shall not be liable for damages caused by water, snow, steam or rain which may infiltrate the Building, leak or discharge from pipes or automatic sprinklers.

19.2 The Lessor shall not be liable for damages caused by failure to fulfil any of its obligations under this lease or damages suffered by the Lessee on account of:

19.2.1 a delay in the construction or completion of the Premises, unless such delay was caused by the fault of the Lessor; or

19.2.2

the interruption or change in any service or utility which the Lessor provides in the Building, caused by strikes, uprisings, labour disputes, accidents, lack of fuel, fire, or any other loss, superior force, act of God or any other cause which are reasonably beyond the control of the Lessor. Such interruptions shall not be construed as an eviction of the Lessee or a reduction in enjoyment of the Premises. As a consequence, the Lessee shall not be entitled to any damages and shall not request any reduction in rent. The Lessor shall, without delay, take all reasonable measures to remedy any such interruption.

19.3 The Lessor shall not be liable for damages to the Premises or to any property, merchandise, securities, business, funds, fixtures, furnishings, accessories or equipment belonging to the Lessee or its employees, agents, clients, visitors or licensees except where such damage results from the Lessor’s intentional or gross fault. The Lessee agrees to hold harmless and indemnify the Lessor from any loss resulting therefrom, except where such loss results from the Lessor’s intentional or gross fault.

19.4 Notwithstanding the foregoing, the Lessor shall be liable for any loss or damages suffered by the Lessee or any third party where such loss and/or damages result from the Lessor’s intentional or gross fault of the Lessor and the Lessor agrees to hold harmless and indemnify the Lessee against any loss, cost, claim or demand resulting therefrom.

SECTION 20 - DEFAULT

20.1	For the purposes of this lease, there shall be a default:

20.1.1

if the Lessee fails to fulfil any monetary obligation under this lease and does not cure the failure within seven (7) days of written notice from the Lessor; or

20.1.2

if the Lessee sub-lets the Premises or makes an assignment of the lease, in whole or in part, other than in compliance with the provisions of Section 14 hereof; or

20.1.3

if the Lessee becomes insolvent or bankrupt, makes an assignment of debts or takes or attempts to take the benefit of the Bankruptcy and Insolvency Act or any law relating to creditor arrangements; or

20.1.4

if the Lessee’s property is the subject of a seizure, notice of closure, a pre-inscription, a prior notice of exercise of a hypothecary right, a proceeding in partition or any other judicial proceeding which might affect the Lessee’s ownership rights in its property and the same is not vacated within ten (10) days; or

20.1.5

if the Lessee does not take possession of the Premises or, after having taken possession, surrenders them; or


								Lessor		Lessee

- 12 -

20.1.6

if an insurance policy issued in the name of the Lessor is cancelled and not replaced by another as a result of the operations of the Lessee or because the Lessee has brought in or stored objects in the Premises which might affect the validity of the said insurance and the insurance is not reinstated within ten (10) days; or

20.1.7

if the Lessee contravenes one of the Building regulations and such default continues for fifteen (15) days after a written notice to this effect has been sent to the Lessee; or also

20.1.8

if any of the declarations of the Lessee in this lease or in any preceding offer thereto proves to be false or inaccurate in all material respects.

If there is a default which is not cured within the aforementioned applicable cure period, if any, the Lessor may without prejudice to its other recourses, terminate the lease upon notice of its intention to do so. The lease shall then be immediately terminated and the Lessor shall repossess the Premises. The Lessor may then lease them again to whomever without notice. The Lessee shall pay all amounts due pursuant to this lease at the termination date. The Lessee shall also pay all reasonable reletting costs incurred by the Lessor (including repairs, alterations or improvements required by such reletting). The Lessee shall pay, moreover, to the Lessor, any losses which the latter suffered during the period corresponding to the unexpired part of the term of the lease until the end of the lease. This loss is payable on a monthly basis at the same due dates as the Rent. In addition, the Lessee shall pay merely for the delay in performing its obligations, a penalty equal to three (3) months’ Net Rent which will become immediately owing and due.

SECTION 21 - INSURANCE

21.1 The Lessee shall take out and keep in force:

21.1.1

comprehensive general liability insurance covering occupancy, use and the business conducted in the Premises including coverage for bodily injury, death, third party property damage, in an amount not less than five million dollars ($5,000,000.00) for each occurrence or any other higher amount which a reasonable and prudent Lessor may require from time to time;

21.1.2

«all risks» and fire insurance with supplementary coverage for leakage of the automatic sprinklers and other fire protection equipment, earthquakes, collapses and floods, covering the furniture and other movable effects, equipment, inventory and securities, computers and computer-related equipment, fixtures and leasehold improvements, mechanical or electrical systems (or parts of such systems) installed by the Lessee and property situated in the Premises, for full replacement value (without depreciation) resulting from each occurrence;

21.1.3

business and rental interruption insurance for a period of twelve (12) months;

21.1.4

insurance coverage for breakage of glass, windows and plate-glass for their full replacement value; and

21.1.5

any other insurance which a reasonable and prudent Lessor may require, from time to time.

21.2 All insurance policies shall:

21.2.1

be in a form acceptable to the Lessor;

21.2.2

be issued by authorized insurers, recognized as solvent and having a place of business in Quebec; and

21.2.3

provide that they may not be cancelled or invalidated prior to thirty (30) days following the receipt by the Lessor of a termination or cancellation notice from the insurer.

The hypothecary creditor of the Immovable and any other person which the Lessor may designate, as an additional insured person, according to their interests, shall be insured persons named in the policies. Each comprehensive general public liability policy shall contain a severance of interest clause or a cross-liability clause between the Lessor and the Lessee. All other policies shall contain a waiver of subrogation rights which the insurers of the Lessee may have against the Lessor, the insurers of the Lessor and the persons under the care and control of the Lessor. The Lessee waives any claim against the Lessor and any person for whom the Lessor is in law responsible. The Lessee shall furnish, on demand by the Lessor, certificates of insurance.


								Lessor		Lessee

- 13 -

21.3 The Lessor may take out and keep in force such insurance policies and pay the premiums thereof if the Lessee fails to do so. The Lessee shall reimburse the premiums paid by the Lessor, on demand.

21.4 The Lessor shall maintain throughout the Term, in those reasonable amounts and with those reasonable deductions that a prudent owner of a class A building located within the Central Business District of Montreal, similar to the Building, would maintain, having regard to size, age and location: (a) all risks insurance on the Immovable and the machinery, boilers and equipment contained in it and owned by the Lessor (except property that the Lessee and other tenants are required to insure); (b) public liability and property damage insurance with respect to the Lessor’s operations on and about the Immovable; and (c) whatever other forms of insurance the Lessor reasonably considers advisable.

SECTION 22 - NON RELOCATION

22.1 The Lessor, after the signature of the Lease, as well as any time during the Term or any extension or renewal thereof shall not have the right to relocate the Lessee, the Premises or any expansion space.

SECTION 23 - MISCELLANEOUS

23.1 Lessor . In the event that the Immovable is sold or leased, the Lessor shall be released from all its obligations to the extent that the purchaser or lessor agrees to assume such obligations.

23.2 Waiver by Lessor . The waiver by the Lessor of any of its rights shall not constitute a waiver of a subsequent exercise of such rights. The exercise by the Lessor of any of its rights shall not prevent it from exercising any other right it possesses. Delays, consents, changes or waivers shall not be opposable to the Lessor unless the Lessor agrees in writing.

23.3 Delay in Payments . Acceptance by the Lessor of a postdated cheque or of any rent payment whatsoever after the due date shall not be deemed to be a method of collection and shall not be construed as novation or as constituting a derogation of the rights, recourses and privileges of the Lessor under this lease. Any amount due by the Lessee under this lease and which is not paid when due shall bear annual interest at the prime rate established by the head office of the Royal Bank of Canada, as it may vary, plus five percent (5%).

23.4 Indivisibility . The obligations of the Lessee are indivisible. Each person designated as lessee or surety, its (his) assignee, successor if he is dead and each of his heirs is bound and may be compelled by the Lessor to perform the obligations of the Lessee alone or together.

23.5 Solidarity . If more than one person is the Lessee or if one or more persons guarantee, assume or otherwise become responsible for the obligations of the Lessee, each of them shall be solidarily liable to the Lessor. Each of them is bound to perform all of the obligations of the Lessee and may separately be compelled by the Lessor to perform them alone or together. The expiry of the term incurred by any of such persons is opposable to all.

23.6 Commission . Lessee is exclusively represented by Colterra Innovative Real Estate Solutions, a real estate agency (“ Agency ”). Each party agrees no other Agency is involved. Lessor is responsible to pay the Agency its leasing commission as per a separate commission agreement to be entered into between them.

23.7 Payment of Rent . All payments that must be effected by the Lessee in accordance with this lease shall be payable by way of cheque, direct deposit, wire transfer or by any other means as agreed by Lessor and Lessee. If payments are made by cheque, the cheque shall be made to the order of GIIAV - Complexe 2020 University and shall be sent at the following address or at any other address that the Lessor may designate from time to time to the Lessee by a written notice:

c/o - Industrial Alliance Insurance and Financial Services Inc.

925 Grande Allée West

Suite 300

Québec City, Qc G1S 1C1

Attention : Real Estate Investments – Accounting


								Lessor		Lessee

- 14 -

23.8 Notices . Any notice required to be given under this lease (herein called the Notice) shall be given in writing. If it is delivered in person, the Notice is deemed to have been received on the date of its delivery. When given by registered mail without transmission by telecopier, the Notice is deemed to have been received on the fifth (5 ^th ) business day following the date of such mailing. By telecopier, the Notice is deemed to have been received on the day of its transmission if transmitted before 5:00 P.M. on a business day and otherwise on the next following business day. Such Notice shall be sent:

23.8.1

In the case of the Lessor, to:

c/o - Industrial Alliance Insurance and Financial Services Inc.

925 Grande Allée West

Suite 300

Quebec City, Qc G1S 1C1

Telecopier: (418) 688-8599

Attention: Mr. Mario Bédard, Vice President, Real Estate Investments

23.8.2

In the case of the Lessee ( before the Commencement Date ), to:

1240, Phillips-Square Street

Montreal, Qc H3B 3H4

Telecopier: (514)397-2537

Attention: Vice President, Legal Affairs and Corporate Secretary

In the case of the Lessee ( after the Commencement Date ), to

At the Premises

Telecopier: (514)397-2537

Attention: Vice President, Legal Affairs and Corporate Secretary

Either party may notify the other in writing of a change of address, in which case all notices will be sent to the address provided in the said notice.

23.8.3

If the Lessor is unable to locate the Lessee at the address indicated in Section 23.8.2, the Lessor may serve or deposit such notice with the clerk of the Superior Court in the district in which the Immovable is situated where the Lessee elects domicile for such purpose.

23.9 Costs and Publication of the Lease . Insofar as the Lessee may wish to publish its rights in the registry office, the parties agree that the Lessee may publish a notice of lease substantially conforming to the one attached hereto as Schedule «D» . The publication costs shall be at the Lessee’s expense. The Lessee shall, at the termination of the lease, cause the registration of such notice to be cancelled at its expense.

The notice of lease published by the Lessee does not effect novation and the parties agree that, in case of any discrepancy, this lease shall have precedence on the said notice of lease.

23.10 Previous Agreements . This lease cancels and replaces any other lease or agreement, written or otherwise made, previously concluded between the Lessor and the Lessee concerning the Premises.

23.11 Nullity of a Clause . If a clause or provision of this lease is declared to be invalid, the validity of any other clause or provision of the lease shall not be affected thereby. Such nullity shall not be the basis for any cause of action by one party against the other.

23.12 Compensation . The Lessee shall pay the Rent within the delays provided in the lease without any deduction or compensation whatsoever.

23.13 Amendment . The lease and its schedules may be amended or changed, in whole or in part, by mutual consent of the parties. In such event, any amendment or change will take effect as of the date of execution of a written agreement between the parties with respect thereto.


								Lessor		Lessee

- 15 -

23.14 Application of payment . The Lessor shall have the right, at its discretion and in the manner that it sees fit, to apply or allocate any amount received from or payable to the Lessee to the payment of any amount due and payable by the Lessee hereunder, the whole, notwithstanding any notice or instruction to the contrary by the Lessee. The Lessee hereby accepts the provisions with respect to such application or allocation of payment.

23.15 Force Majeure . Neither party hereto shall be deemed in default of carrying out its non-monetary obligations hereunder if it has been prevented, delayed or restricted from doing so by reason of a force majeure . Any cause which is beyond the control of the parties, which could not have been foreseen and against which the parties could not have protected themselves shall constitute a force majeure . A force majeure shall include, without limitation, all fortuitous events, strikes, partial or complete work stoppages, lock-outs, fires, riots, civil or military interventions, compliance with statutes and regulations emanating from any governmental authority and declared or undeclared states of war.

23.16 Relationship of the parties . Nothing herein shall be construed as creating a partnership between the Lessor and the Lessee nor shall be construed as implying that the Lessee has the right to involve the liability of the Lessor or to do any act which would create a lien, a priority, a hypothec or any other charge against the Premises or the Immovable.

23.17 Time of the essence . Time is of the essence of this lease unless otherwise indicated herein.

23.18 Waiver . The Lessee hereby renounces to the benefit of Articles 1861, 1863 and 1883 of the Civil code of Quebec.

23.19 Election of domicile . With respect to any claim or litigation which may arise from the present lease, the parties hereto elect domicile in the judicial district of Montreal, in the Province of Quebec, Canada, for the hearing of such claim or litigation, therefore excluding any judicial district which might otherwise have jurisdiction over such litigation as provided by law.

23.20 Communication Needs . Lessor guarantees that during the Term or any extension or renewal thereof, there will be no restrictions or controls imposed by the Lessor to Lessee’s communications service providers, nor will Lessor charge access fees to Lessee’s communication service providers.

Lessee will have the right to install Video surveillance systems within its Premises, and on the de Maisonneuve level, outside its premises, in the corridor.

23.21 Environmentally Hazardous Materials (EHM) . Lessee represents that it will have the cleaning products and lubricants for its watch and jewellery repair division in the Maisonneuve Floor Premises.

Subject to the Lessor verifying the cleaning products and lubricants to its own satisfaction, acting reasonably, Lessor accepts same as long as Lessee takes normal precautionary procedures and does not drain the EHM fluids in the Building’s drainage system.

Any increase in Lessor’s insurance premiums related to this EHM material, will be charged to the Lessee.

23.22 Handicap Access and Code Compliance . Lessor warrants that to the best of his knowledge, the Building complies with all applicable governmental regulations and the Canadian National Building Code.

Capital costs to comply with future regulations will not be included in Operating Costs and will be at the expense of the Lessor.

23.23 Lenders . Lessor hereby warrants and declares that there is no lender with a security interest against the Building. In the event this changes, Lessee shall have the right to a non-disturbance agreement and a priority agreement from each lender with a security interest against the Building acceptable to Lessee as part of the executed Lease.

23.24 Reasonableness . All approvals required from Lessor according to the terms of the present lease shall be reasonably granted or denied with specificity.

SECTION 24 - REGULATIONS OF THE IMMOVABLE

24.1 The regulations concerning the Immovable shall be furnished to the Lessee at the beginning of the term of the lease and these regulations shall be observed and performed by the Lessee, its employees, agents, clients, visitors and licensees. The Lessor may make reasonable amendments to such regulations or adopt


								Lessor		Lessee

- 16 -

other reasonable regulations which are necessary or advisable for the security, maintenance and cleanliness of the Immovable and the Premises as well as for maintaining good order. The Lessor agrees to advise the Lessee in writing of any changes to the regulations. The parties agree that this lease shall have precedence in case of any discrepancy with the regulations.

SECTION 25 - HYPOTHECS AND SUBORDINATION

25.1 This lease and all rights of the Lessee shall be subject and subordinate to all underlying leases, hypothecs, amendments and renewals thereof, which might affect the Immovable. The Lessee agrees to execute and sign any deed or document deemed necessary or desirable by the Lessor in order to subordinate the lease to all such leases or hypothecs, including a Subordination, Non-Disturbance and Attornment Agreement (“ SNDA ”), which terms will be reasonably negotiated. The SNDA will provide, inter alia , that so long as there is no default by Lessee hereunder (after having taken into account any notice periods and corresponding periods to cure), the Lease shall continue in full force and effect and Lessee’s right to possession of the Premises in accordance with the Lease shall not be disturbed.

25.2 The purchaser of the Immovable as a result of an action taken pursuant to a hypothec and the holder of an underlying lease shall assume all the Lessor’s rights under this lease. The Lessee undertakes to execute upon their demand any document to this effect. The Lessor undertakes to act diligently to see that such subordination or attornment does not infringe the Lessee’s right of enjoyment of the Premises under this Lease, as long as the Lessee is not in default hereunder.

25.3 The Lessee waives any right to terminate this lease or to surrender possession of the Premises if proceedings are taken by the Lessor to terminate any underlying lease or if an action is taken against the Lessor pursuant to any hypothec. The Lessee agrees that this lease is not affected by such proceedings.

25.4 The Lessee shall, on demand by the Lessor, provide to the lessor of an underlying lease and to each of the creditors pursuant to a hypothec a written declaration to the effect that this lease is in force and that the Lessor has fulfilled all its obligations (or specify that the obligations have not been fulfilled) as well as any other written declaration, document or certificate reasonably required by them.

SECTION 26 – SURETY Intentionally deleted

SECTION 27 - ADDITIONAL PROVISIONS

27.1 All additional provisions, if any, are those set out in Schedule «E» attached hereto.

SECTION 28 - SCHEDULES

28.1 Schedules «A», «B», «C», «D» and «E» attached hereto and initialled for identification are an integral part of the lease.

SECTION 29 - LANGUAGE

29.1 The parties hereto have requested that this present lease be drafted in English. Les parties aux présentes ont requis que le présent bail soit rédigé en anglais.

THE PARTIES DECLARE THAT THEY HAVE READ AND ANALYZED THE LEASE AND SCHEDULES AND THAT THEY UNDERSTOOD THE NATURE AND EXTENT OF THE LEASE AND SCHEDULES. THEY FURTHER DECLARE THAT THEY WERE ABLE TO FREELY NEGOTIATE EACH OF THE PROVISIONS OF THE LEASE AND ITS SCHEDULES.


								Lessor		Lessee

- 17 -

IN WITNESS WHEREOF, THE PARTIES HAVE SIGNED AS FOLLOWS:

THE LESSEE at Montreal, this 24 ^th day of February 2017.


BIRKS GROUP INC.

/s/ Hélène Delaney				/s/ Pasquale (Pat) Di Lillo
witness

THE LESSOR at Québec this 17 ^th day of March 2017.


7739907 CANADA INC.

/s/ Martin Lambert				Mario Bédard


witness


								Lessor		Lessee

- 18 -

INDEX


Section 1	-	Description of Premises

Section 2	-	Term

Section 3	-	Net Net Lease

Section 4	-	Rent

Section 5	-	Additional Rent

Section 6	-	Payment of Lessee’s Proportionate Share, Property Taxes and Operating Costs

Section 7	-	Other Taxes

Section 8	-	Use of Premises

Section 9	-	Condition of Premises

Section 10	-	Services and Utilities

Section 11	-	Parking

Section 12	-	Exterior Signage

Section 13	-	Guarantee

Section 14	-	Assignment and Subletting

Section 15	-	Lessee’s Obligations

Section 16	-	Work

Section 17	-	Access to Premises

Section 18	-	Fire and Destruction

Section 19	-	Non-Liability of Lessor

Section 20	-	Default

Section 21	-	Insurance

Section 22	-	Non Relocation

Section 23	-	Miscellaneous

Section 24	-	Regulations of the Immovable

Section 25	-	Hypothecs and Subordination

Section 26	-	Surety *Intentionally deleted*

Section 27	-	Additional Provisions

Section 28	-	Schedules

Section 29	-	Language


Schedule “A”		Plan of the Premises
Schedule “B”		Condition of the Premises
Schedule “C”		Consent with respect to Personal Information *Intentionally deleted*
Schedule “D”		Notice of application for the registration of the rights under a commercial lease on an immovable
Schedule “E”		Additional Provisions

SCHEDULE «A»

PLAN OF THE PREMISES

SCHEDULE «B»

BASE BUILDING

By no later than March 31 ^st , 2017, the Lessor shall substantially complete and deliver, at its own cost and expense, the Premises in the following condition, all of which items are collectively defined and referred to herein as the “ Base Building ” , save and except for those items which shall be completed by the Lessor on the dates set out hereunder:

i.	FOR 2 ^nd FLOOR PREMISES

a)	The 2 ^nd Floor Premises will be served with fully equipped restrooms in class A condition for women and men, including provisions for the handicapped.

b)	All perimeter and demising walls with taped and sanded joints with 2 layers of primer.

c)	Smooth levelled broom clean concrete floor.

d)	Main entrance doors and secondary fire exit doors, all in accordance with code, and to be completed by the Lessor no later than April 17, 2017.

e)	New light fixtures for direct lighting required for general lighting up to a level of up to 50ft candles at desk level inside the Premises and distributed as open space, modifications at Lessee’s costs.

f)	Sprinklers with semi-recessed heads distributed as open space, modifications at Lessee’s cost.

g)	Ceiling grid and tiles in new condition.

h)	Complete fire alarm system with emergency communications which include telephones and speakers, emergency lighting and extinguishers.

i)	1 chilled water pipe per premises.

j)	1 electrical panel for each premises of sufficient capacity as per Lessee’s specifications (voltage, amperage and circuits).

k)	Access to emergency generator power, if available.

l)	1 thermostat for each 30 feet of linear feet at the perimeter and 1 thermostat for each 5,000 useable square feet of interior zone.

m)	Sufficient Mecho shades/blind systems to cover all windows, to be completed by the Lessor no later than April 28, 2017.

n)	Service elevator access on the floor of the Premises.

ii.	FOR MAISONNEUVE FLOOR PREMISES

a)	Lessor will provide the plumbing conduit cap to the slab on the Maisonneuve Floor Premises permitting the Lessee to install its own toilets, at Lessee’s costs.

b)	All perimeter and demising walls with taped and sanded joints with 2 layers of primer.

c)	Smooth levelled broom clean concrete floor.

d)	Main entrance doors and secondary fire exit doors, all in accordance with code.

New light fixtures for direct lighting required for general lighting up to a level of up to 50ft candles at desk level inside the Premises and distributed as open space, modifications at Lessee’s costs. (In replacement of the installation of the light fixtures, the Landlord will grant the Tenant a credit of $17,000.00 to pay the Tenant’s contractors).

f)	Sprinklers with semi-recessed heads distributed as open space, modifications at Lessee’s cost.

g)	Lessor to furnish and install fan coils on the floor and connect same to the cooled water. Distribution will be furnished by the Lessor as open space.

h)	Complete fire alarm system with emergency communications which include telephones and speakers, emergency lighting and extinguishers.

i)	1 chilled water pipe.

j)	1 electrical panel of sufficient capacity as per Lessee’s specifications (voltage, amperage and circuits).

k)	Access to emergency generator power, if available.

l)	Building standard thermostatic controls based on open space layout, any modifications at Lessee’s cost.

If available, access to exhaust ducts for light manufacturing activities, including polishing dust removal and small amount of fumes removal from watch and jewellery cleaning solvents, otherwise, Lessor will allow Lessee, at its cost, to install such exhaust ducts in the most cost efficient manner within the Building to the Lessee that does not disturb the efficient operation of the Building.

n)	To provide at Lessee’s cost, structural support for Lessee’s vaults which shall not exceed 600 square feet in total and require 100 pounds per square foot of live weight support.

o)	Freight elevator access on the floor of the Premises as indicated in the floor plan attached hereto as Schedule “A”. The parties recognize that the new issue of the freight access shall not modify the Net Rent payable by the Tenant.


								Lessor		Lessee

SCHEDULE «C»

[Intentionally Deleted]


								Lessor		Lessee

SCHEDULE «D»

NOTICE OF APPLICATION FOR THE REGISTRATION

OF THE RIGHTS UNDER A

COMMERCIAL LEASE ON AN IMMOVABLE

(Art. 2999.1 of the Civil Code of Quebec)

DATE AND PLACE

The 20 at , Province of Quebec.

NATURE OF THE NOTICE

Notice of application for the registration of the rights under a commercial lease on an immovable executed at , on the 20 .

LESSOR’S DESIGNATION

, legal person duly incorporated having its head office at 1080 Grande Allée West, Quebec City, Province of Quebec, G1S 1C7.

LESSEE’S DESIGNATION

, legal person duly incorporated having its head office at .

DESCRIPTION OF PREMISES

An area of square feet ( s.f.) situated in the building bearing civic number , Province of Quebec, which is more fully described as

IMMOVABLE’S DESIGNATION

An immovable known and designated as follows:

Lot number of the Official

Cadastre of , Registration

Division of .


								Lessor		Lessee

TERM

The lease shall commence on the and end on the and the lessee has the option of ( ) additional consecutive terms of renewal of ( ) years each.

DESIGNATION OF THE PERSON GIVING THE NOTICE

(Name and first name), (notary or advocate), practising his (her) profession a t (address)

Executed at , this 20 .

DECLARATION

(Concerning the notice of application for the registration of the rights under a commercial lease on an immovable executed by Me at on 20 and related to the lease entered into between and on the 20 .)

I, the undersigned, (notary or advocate), practising my profession at , certify that:

the content of the present notice is accurate;

I have verified the identity, quality and capacity of the person giving the notice;

the notice represents the will expressed by the person giving it;

the notice is valid as to its form.

Certified at , Province of Quebec, this 20 .


								Lessor		Lessee

- 2 -

SCHEDULE «E»

ADDITIONAL PROVISIONS

1.	Free Rent

The Lessor, in order to induce the Lessee to move into the Building:

Lessor will not charge the Lessee Net Rent and Additional Rent for the 2 ^nd Floor Premises, for the first 18 months of the Term.

ii.

The Lessor will not charge the Lessee Net Rent and Additional Rent for the Maisonneuve Floor Premises, for the first 18 months of the Term as well as the month of May of each year of the Term beginning on May 1, 2019.

2.	Continuous Right of First Refusal

Provided Lessee is not in material default of its Lease, at any time after the signature of the Lease, the Lessee shall have a continuous and revolving right of first refusal, each time an available office space on the 2 ^nd floor of the Building is the object of a bona fide offer to lease received by the Lessor from a third party, and which the Lessor is prepared to accept (the “RFR”) .

Upon receipt of the 3 ^rd party bona fide offer, the Lessor shall diligently provide the Lessee with a copy of the bone fide offer it is prepared to accept or, a written notice which will contain all relevant facts pertaining to the bona fide offer, in order for the Lessee to make a fully informed decision, certifying same and stating the Lessor is prepared unconditionally to accept it.

Lessee shall have a maximum of 10 business days from receipt of the said written notice to advise the Lessor in writing whether or not it wishes to exercise its RFR to lease the space contemplated in the bona fide offer, on the same terms and conditions of the said bona fide offer. Notwithstanding the foregoing, if the RFR is exercised during the first two (2) years of the Term, Lessee shall have a maximum of 3 business days from receipt of the said written notice to advise the Lessor in writing whether or not it wishes to exercise its RFR to lease the space contemplated in the bona fide offer, on the same terms and conditions of the said bona fide offer.

3.	Renewal Option

Provided the Lessee is not in material default of its Lease at the time of Lessee’s exercise of its option to renew the Lease, the Lessor shall grant the Lessee one (1) option to extend the term of the Lease for the Premises for a further period of 5 years (the “ RTN ”), the renewal term commencing the day after the Termination Date.

The Lessee shall give the Lessor written notice to exercise this option no earlier than 1 year and no later than 9 months prior to the Termination Date.

All of the terms and conditions contained in the Lease will remain the same, save and except that:

There shall be no further right of renewal or extension.

II.

There shall be no free rent.

III.

There shall be no lessee allowance.

IV.

The Net Rent shall be:

The Fair Market Rental Rate for 5 year leases at the time of written notice. As used in this sub-paragraph (a), Fair Market Rental Rate means the net rental rate charged to the Lessee on an annual basis, matching the net rental rates offered for the renewal of existing lessee’s or if it’s not applicable, to new lessee’s by the Lessor in the Building at that time for 5 year leases, or

If no 5 year leases have or are being offered on the market by the Lessor at that time, then an accredited commercial appraisal firm (“ Arbitrator ”) will be selected by both parties within 15 days of Lessee’s written notice, failing which each party shall select an Arbitrator, and they will in turn select a third Arbitrator, in order to establish the value of the Fair Market Rental Rate taking into account net rents for renewal of existing lessee’s or for new lessee’s in comparable office premises located in buildings which are similar in age, quality, and size to the Building within a 5 block radius. The two Arbitrators will have 5 days in which to pick the third Arbitrator.

The selected single Arbitrator, or three Arbitrators will then proceed to arrive at a decision on the Fair Market Rental Rate within 30 days after their appointment. If


								Lessor		Lessee

the Arbitrator, or the majority of Arbitrators fail to make a decision within 30 days, a new Arbitrator or Arbitrators will be selected as if none had been previously selected on the same basis as outlined herein.

Until the net rental rate per square foot per annum is established, the net rental rate per square foot per annum (“Previous Net Rental Rate”) for the previous lease year will be maintained.

Within 10 business days of the rendering of the arbitration award, the Lessee shall pay to the Lessor, or the Lessor to the Lessee, as the case may be, the difference between the Fair Market Rental Rate and the Previous Net Rental Rate.

4.	Termination Option

The Lessee shall have the right to terminate the Lease on all of its space effective April 30 ^th , 2027.

The Lessee shall be required to provide 12 months prior written notice to the Lessor of its termination of the Lease.

On or before the effective date of cancellation, the Lessee shall pay an indemnity equal to the then unamortized value of the Lessee’s Allowance, Free Rent and commissions, which amortization shall be at the rate of 8% per year.


								Lessor		Lessee

AGREEMENT OF PRINCIPAL LEASE

BETWEEN

7739907 CANADA INC.

(LESSOR)

AND

BIRKS GROUP INC.

(LESSEE)

EXHIBIT 99.3

SHORT FORM INDUSTRIAL BUILDING LEASE

1. BASIC TERMS . This Section 1 contains the Basic Terms of this lease (this “ Lease ”) between Landlord and Tenant, as each is named below.

1.1.

Effective Date of Lease: , 2017 (“ Effective Date ”)

1.2.

Landlord: SPG PALM CROSSING LLC , a Florida limited liability company

1.3.

Tenant: MAYOR’S JEWELERS OF FLORIDA, INC. , a Florida corporation

1.4.

Premises: Approximately 9,166 rentable square feet known as Suite 402 in the building located at 3440 NW 53 ^rd Street, Fort Lauderdale, Florida (the “ Building ”), as shown on the site plan attached hereto as Exhibit A .

1.5.

Property: The real property on which the Building is located.

1.6.

Lease Term: Ten (10) years and three (3) months (“ Term ”), commencing on the later of (i) May 1, 2017 or (ii) the date on which the Phase I Improvements (as hereinafter defined) are substantially completed (“ Commencement Date ”) and ending on July 31, 2027 (“ Expiration Date ”), subject to Section 5 below.

1.7.

Permitted Uses: (See Section 3 ) Office, administration, warehouse storage, distribution, watch and jewelry design, repair and manufacture, and such other uses ancillary to the foregoing, but subject in all events to Section 9 below.

1.8.

Security Deposit: (See Section 4 ) $7,065.46

1.9.

Base Rent Payable by Tenant is: (See Section 2 )

1.10.

Tenant’s Proportionate Share: 15.35%

1.11.

Initial Estimated Additional Rent: $2,917.84 per month

1.12.

Broker: (A) CREC (“ Tenant’s Broker ”) and (B) Berger Commercial Realty Corp. (“ Landlord’s Broker ”).

1.13.

Exhibits to Lease: The following exhibits are attached to and made a part of this Lease: A (Site Plan); B (Tenant Operations Inquiry Form); C (Lease Commencement Certificate); D (Exclusive Parking); E (Phase I Improvements); E-1 (Phase II Improvements); E-2 (Depiction of Landlord’s Work); F (Renewal Option); G (Right of First Offer); H (Unconditional Guaranty) and (I) SNDA.

2. LEASE OF PREMISES

2.1. RENT . Landlord hereby leases the Premises to Tenant, and Tenant hereby rents the Premises from Landlord, for the Term and subject to the conditions of this Lease. Tenant shall pay net base rent (the “ Base Rent ”) to Landlord in monthly installments, in advance, on the first day of each and every calendar month during the Term, in the amounts and for the periods set forth below:


Lease Period	Monthly Base Rent

May 1, 2017 – October 31, 2017*	$	3,532.73

November 1, 2017 – April 30, 2018	$	7,065.46

May 1, 2018 – April 30, 2019	$	7,277.42

May 1, 2019 – April 30, 2020	$	7,495.74

May 1, 2020 – April 30, 2021	$	7,720.62

May 1, 2021 – April 30, 2022	$	7,952.24

May 1, 2022 – April 30, 2023	$	8,190.80

May 1, 2023 – April 30, 2024	$	8,436.53

May 1, 2024 – April 30, 2025	$	8,689.62

May 1, 2025 – April 30, 2026	$	8,950.31

May 1, 2026 – April 30, 2027	$	9,218.82

May 1, 2027 – July 31, 2027	$	9,495.39

Fifty percent (50%) of Base Rent shall be conditionally abated for the period of time commencing on May 1, 2017, and ending on October 31, 2017 (such period, the “ Free Rent Period ”), which abatement is already reflected in the table of Base Rent. If the Commencement Date occurs on a day other than the first day of a calendar month, the Base Rent due for the first calendar month of the Term after the Free Rent Period shall be prorated on a per diem basis. Notwithstanding such abatement of Base Rent during the Free Rent Period, all Additional Rent and all other amounts or charges due under the Lease shall be payable during the Free Rent Period in accordance with the provisions of the Lease. The abatement of Base Rent during the Free Rent Period provided for in this Section 2.1 is conditioned upon Tenant’s full and timely performance of all of its obligations under the Lease. If at any time during the Term of the Lease, Tenant defaults or breaches any of its obligations under the Lease subject to the applicable notice and cure periods, then the abatement of Base Rent provided for in this provision shall immediately become void, and Tenant shall promptly pay to Landlord, in addition to all other amounts due to Landlord under the Lease, the full amount of all Base Rent herein abated.

2.2. ADDITIONAL RENT . Tenant shall also pay (a) Tenant’s Proportionate Share of all costs and expenses paid or incurred by Landlord with respect to the ownership, management, repair, replacement, restoration, maintenance and operation of the Property, including, without limitation, the costs of Permitted Capital Expenditures (as hereinafter defined), and all insurance premiums for coverages carried by Landlord (the “ Operating Expenses ”); (b) Tenant’s Proportionate Share of all governmental taxes, assessments, fees and charges of every kind or nature due or assessed during the Term in connection with the ownership, leasing and operation of the Premises (“ Taxes ”); (c) any other amounts owed by Tenant hereunder; and (d) all sales tax imposed by any applicable governmental authority on Base Rent and any of the foregoing amounts (the sums described in (a) through (c), collectively, “ Additional Rent ”) to Landlord, c/o Berger Commercial Realty Corp., 11340 Interchange Circle, Miramar, Florida 33025. Checks shall be made payable to Landlord. In the event any monthly installment of Base Rent or Additional Rent, or both, is not paid within 5 days of the date when due, a late charge in an amount equal to 5% of the then delinquent installment of Base Rent and/or Additional Rent (the “ Late Charge ”; the Late Charge, Base Rent and Additional Rent shall collectively be referred to as “ Rent ”) shall be imposed with respect to the then-delinquent Rent payment. Tenant shall pay the Rent promptly when due, without notice or demand, and without any abatement, deduction or setoff. Tenant shall pay, as Additional Rent, its Proportionate Share (as stated in Section 1.10 ) of the Operating Expenses and Taxes. Landlord shall have the right to reasonably estimate the Operating Expenses and Taxes for each calendar year during the Term (the “ Operating Year ”). Upon Landlord’s notice to Tenant of such estimated amount, Tenant shall pay, on or before the first day of each month during that Operating Year, an amount equal to the estimate of Tenant’s Proportionate Share of Operating Expenses and Taxes divided by 12 (or the fractional portion of the Operating Year remaining at the time Landlord delivers its notice of

estimated Operating Expenses and Taxes due from Tenant for that Operating Year). Tenant’s Proportionate Share of Operating Expenses, Taxes and any other sums due and payable under this Lease shall be adjusted upon receipt of the actual bills therefor and the obligations of this Section 2 shall survive the termination or expiration of the Lease. Notwithstanding the foregoing, “Operating Expenses” shall not include: (i) leasing commissions, accountants’ or attorneys’ fees, costs and disbursements and other expenses incurred in connection with proposals, negotiations, or disputes with tenants or other occupants or prospective tenants or other occupants, or associated with the enforcement of any leases or the defense of Landlord’s title to or interest in the Property or any part thereof; (ii) except with respect to Permitted Capital Expenditures, interest on debt or amortization payments on any mortgages or deeds of trust or any other borrowings of Landlord; (iii) except with respect to Permitted Capital Expenditures, any other expense that under generally accepted accounting principles and practices would not be considered a maintenance or operating expense; (iv) salaries, benefits or other compensation paid to leasing agents, promotional directors, officers, directors and executives of Landlord above the rank of Building managers, or not involved in the day-to-day operations or management of the Property (except for out-of-pocket expenses of such persons related to the Property); (v) all contributions to any organizations, whether political or charitable; (vi) interest or penalties for late payments; (vii) costs reimbursed by insurance; and (viii) ground lease rental or depreciation. “ Permitted Capital Expenditures ” shall mean the cost of any capital improvements made to the Property after the date of this Lease that reduce, or that are designed to reduce, Operating Expenses (amortized in accordance with generally accepted accounting principles). Notwithstanding the foregoing, Operating Expenses for 2017 are estimated to be $3.82 per square foot.

2.3. CONTROLLABLE OPERATING EXPENSES . Notwithstanding the foregoing, commencing with calendar year 2018 and each calendar year during the Term thereafter, it is understood and agreed that for purposes of calculating Tenant’s Proportionate Share of the Operating Expenses in any calendar year during the Term, the maximum amount of Controllable Operating Expenses (as hereinafter defined) included in Operating Expenses for any calendar year from and after 2018 during the Term (such maximum amount of Controllable Operating Expenses, the “ Cap ”) shall be limited to the actual amount of Controllable Operating Expenses paid or incurred by Landlord on account of or in calendar year 2017, which Cap shall be increased on a cumulative, compounding basis at five percent (5%) per annum through the applicable calendar year. Tenant shall remain fully liable in each year for the whole amount of Tenant’s Proportionate Share of the Operating Expenses which are not Controllable Operating Expenses. In the event that the Cap applies to limit Tenant’s Proportionate Share of the Operating Expenses attributable to Controllable Operating Expenses for any calendar year, the excluded amount shall be carried forward to succeeding calendar years and recaptured by Landlord so long as the amount of Controllable Operating Expenses does not exceed the Cap (as increased each year) in any such succeeding year. For purposes of clarity, it is acknowledged and agreed that Tenant’s responsibility for Controllable Operating Expenses in any calendar year shall not exceed (i) the Cap (as the same is adjusted annually), or (ii) the actual amount of Controllable Operating Expenses paid or incurred by Landlord in such calendar year, whichever is less. For purposes herein, the term “ Controllable Operating Expenses ” shall mean only (i) the cost of repairs, replacements, maintenance and cleaning, including, without limitation, the cost of janitorial and other service agreements, and trash removal with respect to Common Areas; (ii) the cost of all repairs and maintenance associated with the landscaped areas, surface parking areas and truck courts of the Property, the cost of associated roof maintenance in connection with the Property; and (iii) fees, charges and other costs, including, without limitation, consulting fees, attorneys’ fees and accounting fees of all contractors engaged by Landlord in connection with the operation, maintenance or repair of the Property.

2.4. EARLY ACCESS . From and after the Effective Date, provided that (i) the Premises is vacant and prepared for occupancy as determined in Landlord’s sole discretion, and (ii) Tenant has satisfied the Early Access Conditions (as hereinafter defined), Landlord shall provide Tenant with access to the Premises for space preparation and beneficial occupancy (“ Early Access ”). Tenant shall perform any space preparation in the Premises in accordance with, and subject to the limitations contained in Section 12 applicable to Alterations. Tenant further agrees that Landlord shall not be liable in any way for any injury or death to any person or persons, loss or damage to any of Tenant’s property on the Premises or loss or damage to property placed thereon prior to the Commencement Date, the same being at Tenant’s sole risk. Any Early Access shall also be subject to (A) Tenant first providing to Landlord the certificates of insurance required under Section 11 below, and (B) Tenant’s payment to Landlord of any amounts (e.g., the Security required under Section 4) required to be paid by Tenant to Landlord simultaneously with the execution and delivery of this Lease (the conditions described in clauses (A) – (B) are

collectively referred to herein as the “ Early Access Conditions ”). Tenant agrees that any such entry into and occupancy of the Premises shall be deemed to be under all of the terms, covenants, conditions and provisions of the Lease, except as to the covenant to pay Base Rent and Tenant’s Proportionate Share of Taxes, and the Operating Expenses.

3. USE .

3.1. Use of Premises and Common Areas; Signage . The Premises shall be used by Tenant for the purpose(s) set forth in Section 1.7 above and for no other purpose whatsoever (the “ Permitted Use ”). As used herein, “ Common Areas ” shall mean all areas within the Property that are available for the common use of tenants of the Property and that are not leased or held for the exclusive use of Tenant or other tenants or licensees, including, but not limited to, parking areas, driveways, sidewalks, loading areas, access roads, corridors, landscaping and planted areas. Tenant shall have the nonexclusive right to use the Common Areas for the purposes intended, subject to such reasonable rules and regulations as Landlord may uniformly establish from time to time. From time to time, Landlord may change any or all of the size, location, nature and use of any of the Common Areas although such changes may result in inconvenience to Tenant, so long as such changes do not materially and adversely affect Tenant’s use of the Premises. Tenant may place one (1) building standard exterior sign on the façade of the Building, subject to Landlord’s reasonable approval of the plans and specifications related thereto and compliance with all applicable Laws (as hereinafter defined). Tenant shall not affix any additional sign of any size or character to any portion of either or both of the Premises and the Property, without prior written approval of Landlord. All signage installed by Tenant must comply with applicable laws, ordinances, rules and regulations, and the requirements of any declaration of protective covenants or comparable instrument binding upon the Property. All signage shall be removed by Tenant at its sole cost on or prior to the expiration or sooner termination of the Lease and Tenant shall repair all damage to the Premises or the Property resulting from its removal. Tenant’s obligations under this Section shall survive the expiration or earlier termination of this Lease.

3.2. Parking . Subject to the terms and conditions of this Lease, Tenant and the Tenant’s Parties (as hereinafter defined) shall be entitled to use (i) ten (10) exclusive parking spaces, as depicted on Exhibit D , attached hereto and made a part hereof, and (ii) on a non-exclusive first-come first-served basis, twenty-seven (27) parking spaces located on the Property (collectively, the “ Tenant Spaces ”); provided that in no event shall Tenant and the Tenant’s Parties be entitled to use less than such number of exclusive and non-exclusive parking spaces. Neither Tenant nor the Tenant’s Parties shall with their vehicles block parking areas or hinder normal traffic flow within the Property. Violation of this Section by Tenant or the Tenant’s Parties shall be a default under this Lease. Landlord reserves the right to control the method and manner of parking (including, without limitation, the right to prohibit or limit the use of specific parking spaces or areas), provided however, that Landlord shall not be responsible for policing such parking or enforcing Tenant’s rights hereunder.

3.3. Increase in Insurance Premiums . If an increase in any insurance premiums paid by Landlord for the Property occurs as a result of Tenant’s use of the Premises or if Tenant vacates the Premises and as a result of such vacancy, an increase in such premiums occurs, then Tenant shall pay, as Additional Rent, the amount of such increase to Landlord.

4. SECURITY DEPOSIT . Simultaneously with the execution and delivery of this Lease, Tenant shall deposit with Landlord the sum set forth in Section 1.8 above, in cash (the “ Security ”), representing security for the performance by Tenant of the covenants and obligations hereunder. If Tenant defaults in the performance of any of its covenants hereunder, Landlord may, without notice to Tenant, apply all or any part of the Security, to the extent required for the payment of any Rent or other sums due from Tenant hereunder, in addition to any other remedies available to Landlord. If the Security is so applied, Tenant shall, upon demand, immediately deposit with Landlord a sum equal to the amount so used. If Tenant shall fully and faithfully comply with all of the covenants and conditions of this Lease, the Security Deposit shall be returned to Tenant after the expiration of the Term and the surrender of the Premises to Landlord.

5. CONDITION OF PREMISES . Landlord shall, using building-standard materials, perform those items of work described on Exhibit E attached hereto (the “ Phase I Improvements ”) and those items of work

described on Exhibit E-1 attached hereto (the “ Phase II Improvements ”; and together with the Phase I Improvements, collectively, the “ Landlord’s Work ”) as depicted on Exhibit E-2 attached hereto, pursuant to plans and specifications determined by Landlord. Landlord shall use commercially reasonable efforts to procure bids as Landlord deems reasonably appropriate from no fewer than three (3) contractors approved to work in the Building (which Tenant may supplement, subject to Landlord’s reasonable approval). Upon receipt of all bids requested by Landlord, Landlord shall provide such bids to Tenant for review; provided, however, Landlord shall have the right in its commercially reasonable discretion, to award the construction contract to the contractor and subcontractors that Landlord selects to perform the Landlord’s Work. Landlord shall pay for the Landlord’s Work up to a maximum amount of $91,660.00 (“ Landlord’s Construction Allowance ”), and in no event shall Landlord have any obligation to pay for any costs of the Landlord’s Work in excess of Landlord’s Construction Allowance. The Landlord’s Construction Allowance will be reduced by any consulting or architectural fees incurred by Landlord; and governmental fees and charges for required permits, plan checks, and inspections for the Landlord’s Work. Landlord shall (i) not be entitled to any charge or fee for review, administration, coordination and/or supervision in connection with Landlord’s Work, and (ii) reasonably cooperate with Tenant as may reasonably be necessary to obtain all necessary permits, certificates of occupancy, and inspections, at Tenant’s sole cost and expense. If the cost of the Landlord’s Work exceeds Landlord’s Construction Allowance, such overage shall be paid by Landlord, but repaid to Landlord as Additional Rent, together with interest at 10.00% per annum, in equal monthly installments over the Term of the Lease; provided, however, in no event shall Landlord be obligated to amortize any portion of such overage in excess of $91,660.00 (the “ Amortized Allowance ”) and any estimated overage in excess of such Amortized Allowance shall be paid by Tenant before Landlord begins construction (“ Estimated Overage ”). Upon completion of the Landlord’s Work and the determination by Landlord of the final cost therefor (the “ Final Cost ”), Landlord shall provide Tenant with its calculation of such Final Cost and the allocation of the Landlord’s Construction Allowance, the Amortized Allowance and the Estimated Overage paid by Tenant. If the Final Cost is less than the sum of (a) the Landlord’s Construction Allowance, (b) the Amortized Allowance, and (c) any Estimated Overage actually paid by Tenant to Landlord (the sum of (a), (b) and (c), the “ Total Payments ”), then Landlord shall reimburse Tenant for the excess Estimated Overage paid by Tenant to Landlord within thirty (30) days after the determination of the Final Cost. If the Final Cost exceeds the Total Payments, then Tenant shall pay to Landlord, as Additional Rent, upon request the amount by which the Final Cost exceeds the Total Payments. If the Total Cost is less than the sum of the Landlord’s Construction Allowance and the Amortized Allowance, Tenant shall not receive a credit therefor.

Tenant agrees that, except for the Landlord’s Work and as otherwise expressly set forth in the Lease, Tenant is familiar with the condition of both the Premises and the Property, and Tenant hereby accepts the foregoing on an “AS-IS,” “WHERE-IS” basis, without any representation or warranty from Landlord whatsoever with respect thereto. Landlord shall diligently proceed with the construction of the Landlord’s Work and use commercially reasonable efforts to substantially complete the Phase I Improvements on or prior to May 1, 2017 ; provided, however, if Landlord fails to so substantially complete the Phase I Improvements on or prior to May 1, 2017 , then (a) the validity of this Lease and the obligations of Tenant under this Lease shall not be affected, (b) Tenant shall have no claim against Landlord (and Landlord shall have no liability) hereunder, at law or in equity, arising from Landlord’s failure to substantially complete the Phase I Improvements by such date, and (c) Landlord shall proceed diligently to substantially complete the Phase I Improvements. Tenant acknowledges and agrees that the Phase II Improvements may not be completed as of the Commencement Date, and (aa) Tenant shall accept delivery of the Premises on the Commencement Date notwithstanding the incompletion of the Phase II Improvements; (bb) the validity of this Lease and the obligations of Tenant under this Lease shall not be affected by any delay in the completion of the Phase II Improvements; (cc) Tenant shall have no claim against Landlord (and Landlord shall have no liability) hereunder, at law or in equity, arising from Landlord’s failure to complete the Phase II Improvements by such date, and (dd) the Commencement Date shall not be postponed to the extent of any such delay; provided, however, that Landlord shall diligently proceed to complete the Phase II Improvements promptly after the Commencement Date. In the event any accrued Tenant Delays (as hereinafter defined) cause Landlord to pay or incur costs or expenses in connection with the design, construction or completion of the Landlord’s Work in excess of the costs or expenses that would otherwise have been paid or incurred by Landlord, Tenant shall pay any such reasonable out of pocket excess costs and expenses to Landlord, as Additional Rent, within ten (10) business days after Landlord submits invoices for any such excess costs or expenses. Tenant acknowledges and agrees that (i) Landlord shall not be liable to Tenant for any inconveniences Tenant may experience during the performance, construction or installation of the Landlord’s Work which are beyond Landlord’s control or for any delays in

Landlord’s completion of the Landlord’s Work (regardless of the length of any such delays); (ii) Landlord shall not be obligated to perform, construct or install (or cause to be performed, constructed or installed) the Landlord’s Work at any time other than during normal business hours on regular business days; (iii) Tenant shall ensure that neither Tenant, nor any of the Tenant’s Parties, interfere with or impede the performance and completion of the Landlord’s Work (regardless of whether performed by Landlord or any of Landlord’s agents, employees, contractors, or subcontractors); (iv) Landlord shall have access to the Premises at all times for the purpose of performing, installing and completing the Landlord’s Work; and (v) Tenant shall reasonably cooperate with Landlord during the performance, construction and installation of the Landlord’s Work and Tenant shall be responsible, at no cost to Landlord, for the moving of any and all furniture, trade fixtures, equipment and/or personal property that is reasonably necessary for Landlord to complete (or cause the completion of) the Landlord’s Work. For purpose hereof, the term “Tenant Delays” shall mean delays in the design, construction or substantial completion of the Landlord’s Work by or on behalf of Landlord caused or contributed by Tenant or any of the Tenant’s Parties.

From and after the Commencement Date and throughout the Term, Tenant shall pay annual Base Rent in the amount and in the monthly installments required by Section 2.1 . For purposes of confirming the Commencement Date, the Expiration Date, the acceptance of the Premises by Tenant and the other matters set forth therein, Landlord shall deliver to Tenant a Lease Commencement Certificate in the form attached hereto as Exhibit C (the “ Lease Commencement Certificate ”). If Tenant confirms in writing its agreement with the terms of the Lease Commencement Certificate or fails to respond thereto within five (5) days of Tenant’s receipt thereof, Tenant shall be conclusively deemed to have agreed to and accepted the matters set forth therein.

6. SUBORDINATION; ATTORNMENT; ESTOPPEL; RELEASE OF LANDLORD . This Lease shall be subject and subordinate at all times to any ground lease, mortgage or deed of trust that may now exist or hereafter be placed upon, and encumber, any or all of the Property. Notwithstanding the foregoing, Landlord shall have the right to subordinate or cause to be subordinated any such ground lease, mortgage or deed of trust liens to this Lease. In addition, Tenant agrees, within five (5) business days after request by Landlord, to deliver to Landlord, or Landlord’s designee, an estoppel certificate stating such matters pertaining to this Lease as may be reasonably requested by Landlord. In the event of a sale or conveyance by Landlord of the Property or any assignment of Landlord’s interest in this Lease, the same shall operate to release Landlord from any future liability for any of the covenants or conditions, express or implied, herein contained in favor of Tenant, and in such event Tenant agrees to look solely to Landlord’s successor in interest with respect thereto and agrees to attorn to such successor. Upon Tenant’s written request, Landlord shall use commercially reasonable efforts to execute a commercially reasonable subordination, non-disturbance and attornment agreement in the form set forth on Exhibit I , attached hereto and made a part hereof, from Landlord’s lender. Landlord hereby covenants with Tenant that Landlord shall not sell, convey or otherwise transfer its interest in the Property prior to the Commencement Date and the completion of Landlord’s Work.

7. QUIET ENJOYMENT . Subject to the provisions of this Lease, so long as Tenant pays all of the Rent and performs all of its other obligations hereunder, Tenant shall not be disturbed in its possession of the Premises by Landlord or any other person lawfully claiming through or under Landlord; provided, however, Landlord shall be provided reasonable access to the Premises such that Landlord and Landlord’s agents, employees, contractors and representatives may perform the General Maintenance Services (as hereinafter defined) without undue interruption, delay or hindrance.

8. ASSIGNMENT, SUBLETTING AND MORTGAGING . Tenant shall not, whether voluntarily, by operation of law, or otherwise, sublet, assign, mortgage, pledge, encumber, or otherwise hypothecate or transfer this Lease (or any interest therein) or the Premises, or any part thereof, in any manner whatsoever without the prior written consent of Landlord. Notwithstanding the foregoing, provided that (i) Tenant is not in default under this Lease, and (ii) no such transaction is undertaken with the intent of circumventing Tenant’s liability under this Lease, Tenant may assign this Lease to any affiliate or subsidiary of Tenant or in connection with a merger or other consolidation of Tenant and may sublease all or some portion of the Premises to an affiliate or subsidiary of Tenant without Landlord’s consent provided: (a) Tenant shall remain liable hereunder; (b) Tenant provides reasonable prior written notice to Landlord of such assignment or sublease; (c) after such transaction is effected, the tangible net worth of the transferee (excluding goodwill) is equal to or greater than the tangible net worth of Tenant as of the date of this Lease; and (d) Landlord shall have received an executed copy of all documentation effecting such transfer on or before its effective date.

9. COMPLIANCE WITH LAWS . Tenant shall, at its sole expense (regardless of the cost thereof), comply with all laws, ordinances, rules, orders, regulations, guidelines and other requirements of federal, state or local governmental authorities or of any private association or contained in any restrictive covenants or other declarations or agreements, now or subsequently pertaining to the Property or the use and occupation of the Property (collectively, “ Laws ”), pertaining to either or both of the Premises and Tenant’s use and occupancy thereof. Without limitation of the foregoing, (i) Tenant represents and warrants to Landlord that Tenant has not violated any laws relating to terrorism or money laundering (collectively, the “ Anti-Terrorism Laws ”) and (ii) Tenant covenants and agrees to comply with all Anti-Terrorism Laws during the Term of this Lease. Notwithstanding the foregoing, Landlord agrees that if Landlord receives a written notice from a governmental authority (“ Citation ”) notifying Landlord that the Premises are not in compliance with any Laws as of the Effective Date, Landlord shall cause any repairs, replacements or improvements to be made to the Premises, so as to remedy the matter set forth in the Citation (“ Citation Remedy ”). The costs and expenses incurred by Landlord to perform any Citation Remedy pursuant to the preceding sentence shall be (x) the sole responsibility of Tenant if the matter set forth in the Citation is as a result of (1) Tenant’s particular use of the Premises (as opposed to warehouse use in general); (2) any Tenant Necessitated Repairs (as hereinafter defined); or (3) Alterations performed by or at the request of Tenant (other than the Landlord’s Work) (items (1) through (3) collectively, “ Tenant Repair Items ”); or (y) the sole responsibility of Landlord except as otherwise set forth in clause (x) above. If Landlord receives a Citation notifying Landlord that the Premises are not in compliance with any Laws as of any date after the Effective Date, (A) Tenant shall perform the Citation Remedy at its sole cost and expense if such Citation Remedy is any of the Tenant Repair Items, or (B) Landlord shall perform the Citation Remedy if such Citation Remedy is not any of the Tenant Repair Items, at Landlord’s sole cost and expense. Notwithstanding anything herein to the contrary, before performing any Citation Remedy required hereunder, Landlord shall have the right to appeal or dispute such Citation so long as such appeal or dispute does not unreasonably affect Tenant’s ability to operate in the Premises. For purposes herein, a “ Tenant Necessitated Repair ” shall mean any work, maintenance, repairs or replacements that are required as a result of the negligence or misconduct of Tenant or any of the Tenant’s Parties, or Tenant’s failure to repair and maintain the Premises or the misuse of the Premises or the Property by Tenant or the Tenant’s Parties.

10. HAZARDOUS MATERIALS . Except as set forth on Addendum 1 (subject to the terms and conditions thereof), Tenant, its agents or employees, shall not bring or permit to remain on the Premises or Property any asbestos, petroleum or petroleum products, explosives, toxic materials, or substances defined as hazardous wastes, hazardous materials, or hazardous substances under any federal, state, or local law or regulation (each, a “ Hazardous Material ” and, collectively, “ Hazardous Materials ”). Tenant’s violation of the foregoing prohibition shall constitute a material breach and Default (as defined below) hereunder and Tenant hereby indemnifies, holds harmless and defends Landlord from and against any claims, damages, penalties, liabilities, and costs (including reasonable attorney fees and court costs) caused by or arising out of (i) a violation of the foregoing prohibition by Tenant (including a violation that occurred during any Early Access), (ii) the presence of any Hazardous Materials on, under, or about the Premises or the Property during the term of the Lease (and during any Early Access), which presence is the result of, or caused by, or arising, in whole or in part, out of the actions of Tenant, its agents or employees, or (iii) the Tenant’s (or any party within Tenant’s control) violation (including a violation that occurred during any Early Access) of any and all laws pertaining to Hazardous Materials or that otherwise deal with, or relate to, air or water quality, air emissions, soil or ground conditions or other environmental matters of any kind (“ Environmental Laws ”). Such indemnity shall survive the termination or expiration of this Lease. Tenant shall clean up, remove, remediate and repair, in conformance with the requirements of applicable law, any soil or ground water contamination and damage caused by the presence and any release of any Hazardous Materials in, on, under or about the Premises or the Property during the term of the Lease (and during any Early Access) and caused by or arising, in whole or in part, out of the actions of Tenant, its agents or employees. Tenant shall immediately give Landlord written notice of any suspected breach of this section upon learning of the presence of any release of any Hazardous Materials, and upon receiving any notices from governmental agencies pertaining to Hazardous Materials which may affect the Premises or the Property. Tenant has delivered to Landlord (or shall deliver to Landlord, on or before the Commencement Date), a completed Tenant Operations Inquiry, in the form attached hereto as Exhibit B and Tenant hereby warrants the accuracy and completeness of the information set forth therein. The obligations of Tenant hereunder shall survive the expiration of earlier termination, for any reason, of this Lease.

11. INSURANCE . Tenant shall purchase at its own expense and keep in force during this Lease, a policy or policies of insurance covering Tenant’s personal property and any losses arising out of Tenant’s liability for personal injuries or deaths of persons and property damage occurring in or about the Premises and Property in such form and including such coverages as Landlord may reasonably require, including, but not limited to, commercial general or excess liability insurance, comprehensive automobile liability insurance (if applicable), commercial property insurance and workers’ compensation insurance. Tenant’s commercial general or excess liability insurance shall name Landlord as an additional insured and provide coverage for personal injury and property damage in an amount of not less than $1,000,000 per occurrence and $2,000,000 annual general aggregate, per location. A Certificate(s) of Insurance, in form and substance reasonably acceptable to Landlord, evidencing said policies, shall be delivered to Landlord by Tenant prior to the Commencement Date, or if applicable, prior to any Early Access. To the extent permitted by Law, and without affecting the coverage provided by insurance required to be maintained hereunder, Landlord and Tenant each waive any right to recover against the other for damages to property, damages to the Premises and the Property, or claims arising by reason of the foregoing, to the extent such damages and claims are insured against or required to be insured against by Landlord or Tenant under this Lease. The coverage obtained by each party pursuant to this Lease shall include, without limitation, a waiver of subrogation by the carrier which conforms to the provisions of this section.

12. ALTERATIONS . Tenant shall not make or suffer or allow to be made any alterations, additions or improvements in or to the Premises (collectively, “ Alterations ”) without first obtaining Landlord’s written consent based on detailed plans and specifications submitted by Tenant; provided Landlord’s consent will not be required if (a) the proposed Alterations will not affect the structure or the mechanical, electrical, HVAC, plumbing or life safety systems of the Building and (b) the total cost to acquire and install the proposed Alterations will be no more than (i) $15,000.00 in any one instance and (ii) $25,000.00 in the aggregate during any calendar year. In all other instances where Landlord’s consent is so required, it may be granted or withheld by Landlord in its sole and absolute discretion. In all events, Tenant shall notify Landlord prior to commencing Alterations other than de minimis Alterations, and Landlord shall have the right, at Landlord’s election, to supervise the Alterations work. Tenant agrees that all such work (regardless of whether Landlord’s consent is required) shall be done at Tenant’s sole cost and expense, in accordance with the plans and specifications approved by Landlord and in a good and workmanlike manner, that the structural integrity of the Building shall not be impaired, and that no liens shall attach to all or any part of the Premises, the Building, or the Property by reason thereof. In addition to the foregoing, Tenant agrees to pay to Landlord, as Additional Rent, Landlord’s reasonable costs and expenses paid or incurred in connection with Landlord’s review of plans and specifications and Landlord’s project supervision relating to Tenant’s design and installation of Alterations at the Premises. Tenant shall obtain, at its sole expense, all permits required for such work.

13. LANDLORD’S AND TENANT’S PROPERTY . All fixtures, machinery, equipment, improvements and appurtenances attached to, or built into, the Premises (collectively, “ Fixtures ”) at the commencement of any Early Access, or during the Term, whether or not placed there by or at the expense of Tenant, shall become and remain a part of the Premises; shall be deemed the property of Landlord (the “ Landlord’s Property ”), and shall not be removed by Tenant at the Expiration Date unless Landlord requests their removal. All movable non-structural partitions, business and trade fixtures, machinery and equipment, communications equipment and office equipment that are installed in the Premises by, or for the account of, Tenant and without expense to Landlord and that can be removed without structural damage to the Property, and all furniture, furnishings and other articles of movable personal property owned by Tenant and located in the Premises (collectively, the “ Tenant’s Property ”) shall be and shall remain the property of Tenant. At or before the Expiration Date, or the date of any earlier termination of this Lease, Tenant, at its expense, shall remove from the Premises all of Tenant’s Property, any Alterations (except such items thereof as constitute Landlord’s Property unless Landlord otherwise directs) and any Fixtures designated by Landlord as requiring removal and Tenant shall repair any damage to the Premises or the Property resulting from any installation and/or removal thereof. If any items of Tenant’s Property remain at the Premises following the expiration or termination of this Lease, such items shall automatically be deemed abandoned and Landlord may take any action whatsoever as Landlord may desire with respect to such remaining items of Tenant’s Property. Notwithstanding the foregoing, Landlord and Tenant acknowledge and agree that upon termination or expiration of the Term of the Lease, Tenant will be responsible for disassembling and removing the vault from the Premises and restoring the affected area of the Premises thereof to its condition prior to the installation of the vault.

14. REPAIRS AND MAINTENANCE . Tenant shall, at its expense, throughout the Term, keep, maintain and preserve, in good condition and repair, the Premises and the fixtures and appurtenances therein. Tenant’s obligations hereunder shall include, but not be limited to, the maintenance, repair and replacement, if necessary, of all heating, ventilation, air conditioning (“ HVAC ”) servicing the Premises, lighting and plumbing fixtures and equipment, fixtures, motors and machinery, all interior walls, partitions, doors and windows, including the regular painting thereof, all exterior entrances, windows, doors and docks and the replacement of all broken glass. Throughout the Term, Tenant shall maintain, at its own expense, an HVAC maintenance contract that is reasonably acceptable to Landlord. Notwithstanding anything herein to the contrary, in the event that any HVAC unit(s) or any major component of the HVAC unit(s) (i.e., the air-handler, compressor, coil or condenser) serving the Premises requires replacement (rather than repair), as reasonably determined by Landlord, during the Term of the Lease, then Landlord, not Tenant, shall replace the HVAC unit(s) or applicable component of any such HVAC unit(s) at Landlord’s sole cost and expense; provided, however, that in the event any such replacement is necessary due to (a) the negligence or misconduct of Tenant or the Tenant’s Parties, or (b) Tenant’s failure to repair and maintain the HVAC unit(s) or the misuse of the Premises by Tenant or the Tenant’s Parties, then Tenant, and not Landlord, shall be solely responsible for the total cost of any such replacement of the applicable HVAC unit(s) or major component thereof and Tenant shall pay such amount to Landlord, as Additional Rent under the Lease, within ten (10) days after the delivery to Tenant of written demand, together with supporting invoices, therefor. Landlord shall repair, replace and restore the Common Areas and the foundation, exterior and interior load-bearing walls, roof structure and roof covering and tuckpointing of the Building and the cost of all such matters performed by Landlord shall constitute Operating Expenses. Notwithstanding any of the foregoing, however, from time to time during the Term, Landlord may elect, in its sole discretion following Tenant’s failure to cure following delivery of written notice to Tenant, to perform on behalf of Tenant, all or some portion of the repairs, maintenance, restoration and replacement in and to the Premises required to be performed by Tenant under this Lease (any such repairs, maintenance, restoration and/or replacement activities that Landlord elects to perform on behalf of Tenant are herein collectively referred to as “ General Maintenance Services ”). Tenant shall reimburse Landlord for the cost or value of all General Maintenance Services provided by Landlord as Additional Rent. Unless and until Landlord affirmatively elects to provide General Maintenance Services, nothing contained herein shall be construed to obligate Landlord to perform any General Maintenance Services or, except as otherwise expressly provided in this Section 14 , to repair, maintain, restore or replace any portion of the Premises. Landlord may from time to time, in its sole discretion, (a) reduce or expand the scope of the General Maintenance Services that Landlord has elected to provide or (b) revoke its election to provide any or all of the General Maintenance Services.

15. UTILITIES . Tenant shall purchase all utility services from the utility or municipality providing such service; shall provide for regular scavenger, cleaning and extermination services; and shall pay for such services when payments are due. To the extent any such services are not separately metered to the Premises, Tenant shall pay to Landlord, as Additional Rent, Tenant’s Proportionate Share of the cost thereof.

16. INVOLUNTARY CESSATION OF SERVICES . Landlord reserves the right, without any liability to Tenant and without affecting Tenant’s covenants and obligations hereunder, to stop service of any or all of the HVAC, electric, sanitary, and other systems serving the Premises, or to stop any other services required by Landlord under this Lease, whenever and for so long as may be necessary by reason of (i) accidents, emergencies, strikes, or the making of repairs or changes which Landlord, in good faith, deems necessary or (ii) any other cause beyond Landlord’s reasonable control. No such interruption of service shall be deemed an eviction or disturbance of Tenant’s use and possession of the Premises or any part thereof, or render Landlord liable to Tenant for damages, or relieve Tenant from performance of Tenant’s obligations under this Lease, including, but not limited to, the obligation to pay Rent; provided, however, that if any interruption of services is caused on account of Landlord’s negligence and persists for a period in excess of five (5) consecutive days Tenant shall, as Tenant’s sole remedy, be entitled to a proportionate abatement of Rent to the extent, if any, of any actual loss of use of the Premises by Tenant.

17. LANDLORD’S RIGHTS . Landlord, and its agents, employees and representatives shall have the right to enter and/or pass through the Premises at any time upon reasonable prior notice (except that no such notice is required in the event of an emergency): (a) to examine and inspect the Premises; (b) to make repairs and improvements in or to the Premises and the Property; and (c) to exhibit the Premises to (i) purchasers and lenders at any time and (ii) prospective tenants during the last nine (9) months of the Term.

18. NON-LIABILITY, INDEMNIFICATION AND FORCE MAJEURE . None of Landlord, any other managing agent, or their respective affiliates, owners, partners, directors, officers, agents and employees shall be liable to Tenant for any loss, injury, or damage, to Tenant or to any other person, or to its or their property, irrespective of the cause of such injury, damage or loss unless due to the gross negligence or willful misconduct of any of the Landlord Indemnified Parties (as hereinafter defined). Tenant hereby indemnifies, defends, and holds Landlord and its affiliates, owners, partners, directors, officers, agents and employees (collectively, “ Landlord Indemnified Parties ”) harmless from and against any and all claims, demands, expenses actions, judgments, damages (whether direct or indirect, known or unknown, and foreseen or unforeseen), penalties, fines, liabilities, losses, suits, administrative proceeding costs and fees, including, without limitation reasonable attorneys’ fees, arising from or in connection with (a) any act, omission, negligence or willful misconduct of any or all of Tenant and any or all of Tenant’s officers, directors, members, managers, partners, invitees, agents, employees, contractors or representatives (collectively, “ Tenant’s Parties ”); (b) any accident, injury or damage whatsoever (unless solely caused by Landlord’s negligence) occurring in, at or upon either or both of the Property and the Premises and caused by any or all of Tenant and Tenant’s Parties; (c) any breach by Tenant of any of its warranties and representations under this Lease; (d) any actions necessary to protect Landlord’s interest under this Lease in a bankruptcy proceeding or other proceeding under the Bankruptcy Code; (e) any violation or alleged violation by any or all of Tenant and Tenant’s Parties of any Law including, without limitation, any Environmental Law; (f) claims for work or labor performed or materials supplies furnished to or at the request of any or all of Tenant and Tenant’s Parties; (g) claims arising from any breach or default on the part of Tenant in the performance of any covenant contained in this Lease. The provisions of the foregoing indemnity shall survive the expiration or termination of this Lease. Each of the obligations of Tenant (except the obligation to pay Rent and the obligation to maintain insurance, and provide evidence thereof, in accordance with Section 11 ) and each of the obligations of Landlord, shall be excused, and neither Landlord nor Tenant shall have any liability whatsoever to the other, to the extent that any failure to perform, or delay in performing such obligation arises out of either or both of (i) any labor dispute, governmental preemption of property in connection with a public emergency or shortages of fuel, supplies, or labor, or any other cause, whether similar or dissimilar, beyond Landlord’s or Tenant’s, as the case may be, reasonable control; (ii) any failure or defect in the supply, quantity or character of utilities furnished to the Premises, or by reason of any requirement, act or omission of any public utility or others serving the Property, beyond Landlord’s or Tenant’s, as the case may be, reasonable control; and (iii) any actions or inactions of governmental authorities (items (i), (ii) and (iii), collectively, “ Force Majeure Events ”).

19. DAMAGE OR DESTRUCTION . If either or both of the Property and the Premises is damaged by fire or other insured casualty, Landlord shall have the option either: (a) to terminate this Lease (by so advising Tenant, in writing) within thirty (30) days after said destruction or casualty effective as of the date upon which Tenant receives timely written notice thereof; or (b) to restore and rebuild the Property and/or the Premises with reasonable dispatch. Notwithstanding the foregoing, Landlord may only terminate this Lease under this Section 19 if the cost to repair damage to or destruction of the Premises or Property, as the case may be, exceeds fifty percent (50%) of the replacement cost of the Premises or Property, as the case may be. In no event, however, shall Tenant have the right to terminate this Lease. If Landlord elects to repair and restore the Property (or Premises, as the case may be), Tenant shall not be entitled to (and Landlord shall have no obligation to pay) any damages or compensation, of any nature, for any purported inconvenience, loss of business or annoyance from any repair or restoration undertaken by or on behalf of Landlord under this Section 19 unless such direct damages result from Landlord’s gross negligence or willful misconduct. Notwithstanding the foregoing, if a casualty renders all or part of the Premises untenantable, Rent shall proportionately abate commencing on the date of the casualty and ending when the Premises are delivered to Tenant. The extent of the abatement shall be based upon the portion of the Premises rendered untenantable, inaccessible or unfit for use in a reasonable business manner for the purposes stated in this Lease as reasonably determined by Landlord.

20. EMINENT DOMAIN . If the whole, or any substantial portion, of the Property is taken or condemned for any public use under any Law or by right of eminent domain, or by private purchase in lieu thereof, and such taking would prevent or materially interfere with the Permitted Use of the Premises, this Lease shall terminate effective when the physical taking of said Premises occurs. If less than a substantial portion of the Property is so taken or condemned, this Lease shall not terminate, but the Rent payable hereunder shall be proportionally abated to the extent of any actual loss of use of the Premises by Tenant. Landlord shall be entitled to any and all payment, income, rent or award, or any interest therein whatsoever, which may be paid or made in connection with such a taking or conveyance.

21. SURRENDER AND HOLDOVER . On the last day of the Term, or upon any earlier termination of this Lease, (a) Tenant shall quit and surrender the Premises to Landlord broom-clean, and in a condition that would reasonably be expected with normal and customary use in accordance with prudent operating practices and in accordance with the covenants and requirements imposed under this Lease, subject only to ordinary wear and tear (as is attributable to deterioration by reason of time and use, in spite of Tenant’s reasonable care) and such damage or destruction as Landlord is required to repair or restore under this Lease; and (b) Tenant shall remove all of Tenant’s Property therefrom, except as otherwise expressly provided in this Lease. For purposes hereof, “broom-clean” shall mean: (i) all walls must be clean and free of holes; (ii) overhead doors must be free of any broken panels, cracked lumber or dented panels and the overhead door springs, rollers, tracks, motorized door operator and all other items pertaining to the overhead doors must be in good working condition; (iii) HVAC system must be in good working order, with filters changed and all thermostats in working order, and Tenant must supply Landlord with maintenance records; (iv) all floors (warehouse and office) must be clean and free of excessive dust, dirt, grease, oil and stains; (v) drop grid ceiling must be free of excessive dust from lack of changing filters and no ceiling tiles may be missing or damaged; (vi) all trash must be removed from both inside and outside of the Building; (vii) all lightbulbs and ballasts must be working; (viii) all signs in front of Building and on glass entry door and rear door must be removed; (ix) hot water heater must work; (x) all plumbing fixtures, equipment and drains must be clean and in working order; (xi) windows must be clean; and (xii) all mechanical and electrical systems must be in good working condition. All repairs shall be performed to Landlord’s reasonable satisfaction and Landlord shall have the right to perform, at Tenant’s expense, any repairs that Tenant fails to perform. If Tenant remains in possession after the Expiration Date hereof or after any earlier termination date of this Lease, Tenant shall be deemed a tenant-at-will terminable upon thirty (30) days’ written notice from Landlord, shall pay 150% of the aggregate of the Rent last prevailing hereunder, and also shall pay all actual damages sustained by Landlord as a direct result of Tenant’s remaining in possession after the expiration or termination of this Lease. Tenant’s obligations under this Section 21 shall survive the termination or expiration of this Lease.

22. EVENTS OF DEFAULT . Each of the following shall constitute a “Default” by Tenant under this Lease: (a) if Tenant fails to pay any or all of Base Rent, Additional Rent and any other payment within five (5) days after receipt of e-mail notice from Landlord of Tenant’s failure to pay such Rent; (b) if Tenant fails to timely comply with, or satisfy, any or all of the obligations imposed on Tenant under this Lease (other than the obligation to pay Base Rent and Additional Rent) for a period of ten (10) days after Landlord’s delivery to Tenant of written notice of such default; provided, however, that if the default cannot, by its nature, be cured within such ten (10) day period, but Tenant commences and diligently pursues a cure of such default promptly within the initial ten (10) day cure period, then Landlord shall not exercise its remedies unless such default remains uncured for more than thirty (30) days after Landlord’s initial notice; or (c) if Tenant makes a general assignment for the benefit of creditors, a petition under any state or federal bankruptcy or insolvency law is filed by or against Tenant (unless in the case of a petition filed against Tenant, the same is dismissed within fifteen (15) business days after filing), a receiver of Tenant, or of, or for, the property of Tenant shall be appointed, or Tenant admits it is insolvent or is not able to pay its debts as they mature. For purposes of (a) in this Section 22, Landlord shall send e-mail notice to the following e-mail addresses: apexpense@birksgroup.com, mmelfi@birksgroup.com and kkirner@birksgroup.com .

23. REMEDIES . In the event of any Default by Tenant under this Lease (and without additional or further notice or demand from Landlord, if any notice or demand was initially required under Section 22 ), Landlord, at its option, may exercise any and all of its rights and remedies provided in this Lease, as well as any or all rights and remedies available at law or in equity. Any and all costs, expenses and disbursements, of any kind or nature, incurred by Landlord in connection with the enforcement of any and all of the terms and provisions of this Lease, including attorneys’ reasonable fees (through all appellate proceedings), shall be due and payable (as Additional Rent) upon Landlord’s submission of an invoice therefor. All sums advanced by Landlord on account of Tenant pursuant to any provision of this Lease, and all Base Rent and Additional Rent, if delinquent or not paid by Tenant and received by Landlord when due hereunder, shall bear interest at the rate of 5% per annum above the “prime” or “reference” or “base” rate (on a per annum basis) of interest publicly announced as such, from time to time, by JP Morgan Chase Bank NA (the “ Default Rate ”), from the due date thereof until paid, and such interest shall be and constitute Additional Rent and be due and payable upon Landlord’s submission of an invoice therefor. If Tenant shall be in Default under this Lease, Landlord may cure the Default at any time for the account and at the expense of

Tenant. If Landlord cures any Default on the part of Tenant, Tenant shall reimburse Landlord, upon demand, for any amount expended by Landlord in connection with the cure, including, without limitation, attorneys’ fees and interest at the Default Rate. The following are additional remedies available to Landlord and provisions addressing waivers (or potential waivers) of default: (a) The rights and remedies of Landlord set forth herein shall be in addition to any other right and remedy now and hereafter provided by law. All rights and remedies shall be cumulative and not exclusive of each other. Landlord may exercise its rights and remedies at any times, in any order, to any extent, and as often as Landlord deems advisable without regard to whether the exercise of one right or remedy precedes, concurs with or succeeds the exercise of another; (b) A single or partial exercise of a right or remedy shall not preclude a further exercise thereof, or the exercise of another right or remedy from time to time; (c) No delay or omission by Landlord in exercising a right or remedy shall exhaust or impair the same or constitute a waiver of, or acquiescence to, a Default; (d) No waiver of Default shall extend to or affect any other Default or impair any right or remedy with respect thereto; I No action or inaction by Landlord shall constitute a waiver of Default; and (f) No waiver or a Default shall be effective unless it is in writing and signed by Landlord.

24. BROKER . Tenant covenants, warrants and represents that the broker set forth in Section 1.12(A) was the only broker to represent Tenant in the negotiation of this Lease (“ Tenant’s Broker ”). Landlord covenants, warrants and represents that the broker set forth in Section 1.12(B) was the only broker to represent Landlord in the negotiation of this Lease (“ Landlord’s Broker ”). Landlord shall be solely responsible for paying the commission of Landlord’s Broker and Tenant’s Broker. Each party agrees to and hereby does defend, indemnify and hold the other harmless against and from any brokerage commissions or finder’s fees or claims therefor by a party claiming to have dealt with the indemnifying party and all costs, expenses and liabilities in connection therewith, including, without limitation, reasonable attorneys’ fees and expenses, for any breach of the foregoing. The foregoing indemnification shall survive the termination or expiration of this Lease.

25. MISCELLANEOUS . (a) Notices – Any notice required to be given by either party pursuant to this Lease, shall be in writing and shall be deemed to have been properly given, rendered or made only if personally delivered, or if sent by Federal Express or other comparable commercial overnight delivery service, or by facsimile or electronic transmission, addressed to the other party at the addresses set forth below such party’s signature, and shall be deemed to have been given, rendered or made on the day so delivered or on the first business day after having been deposited with the courier service; (b) Legal Costs – Any party in breach or default under this Lease (the “ Defaulting Party ”) shall reimburse the other party (the “ Nondefaulting Party ”) upon demand for any legal fees and court (or other administrative proceeding) costs or expenses that the Nondefaulting Party incurs in connection with the breach or default, regardless whether suit is commenced or judgment entered including, without limitation, legal fees and costs incurred for the negotiation of a settlement, enforcement of rights or otherwise; (c) Parties Bound – Except as otherwise expressly provided for in this Lease, this Lease shall be binding upon, and inure to the benefit of, the successors and assignees of the parties hereto. The liability of Landlord to Tenant hereunder shall be limited to the interest of Landlord in the Property, and Tenant agrees to look solely to Landlord’s interest in the Property for the recovery of any judgment or award against Landlord, it being intended that Landlord shall not be personally liable for any judgment or deficiency; (d) Recordation of Lease – Tenant shall not record or file this Lease (or any memorandum hereof) in the public records of any county or state; (e) Liens – At no time during the Term, and for no reason whatsoever, may Tenant permit any third party to encumber the Premises or Property with any lien, of any nature; (f) Financial Information . At any time during the Term that neither Tenant nor any of its parent affiliates are a “publicly traded company” (i.e., ownership interests are listed on a public securities exchange), Tenant shall deliver to Landlord information and documentation describing and concerning Tenant’s financial condition, and in form and substance reasonably acceptable to Landlord (including, but not limited to, audited statements, balance sheets and income statements), within ten (10) days following Landlord’s written request therefor. Landlord shall hold any such financial statements in confidence, except that Landlord shall be permitted to disclose such information to actual and potential lenders, actual and potential purchasers of the Building, and all of their respective employees, attorneys and advisors, provided Landlord informs such parties of the confidential nature of such information and uses good faith and diligent efforts to cause such parties to maintain such information as confidential; (g) Governing Law; Counterparts – This Lease shall be governed by and construed in accordance with the laws of the state in which the Property is located. If any provision of this Lease shall be invalid or unenforceable, the remainder of this Lease shall not be affected but shall be enforced to the extent permitted by law. This Lease may be executed in counterpart and, when all counterpart documents are executed, the counterparts shall constitute a single binding instrument; (h) Time – Time is of the essence of this Lease. If the time

for performance hereunder falls on a Saturday, Sunday or a day that is recognized as a holiday in the state in which the Property is located, then such time shall be deemed extended to the next day that is not a Saturday, Sunday or holiday in said state; and (i) Amendment – This Lease may not be altered, waived, amended or extended except by an instrument in writing signed by Landlord and Tenant.

26. RENEWAL OPTION . If Tenant is not in default (beyond applicable periods for notice and cure) under the Lease at the time the options to renew described below (each, a “ Renewal Option ”) are exercised, or as of the commencement of the applicable Renewal Period (as hereinafter defined), Tenant shall have two (2) options to extend the Term for a period of five (5) years each (each, a “ Renewal Period ”) commencing on the first day following the last day of the initial Term of the Lease or first Renewal Period, as applicable, upon the same terms and conditions as are contained in the Lease, except as hereinafter provided. Base Rent for the applicable Renewal Period shall be equal to the greater of (i) the Fair Market Value Rental (as defined in Exhibit F attached hereto), or (ii) the annual Base Rent for the last year of the initial Term of the Lease or first Renewal Period, as applicable. The Fair Market Value Rental shall be determined in accordance with Exhibit F . Each Renewal Option shall be exercised by written notice to Landlord given no earlier than twelve (12) months nor later than nine (9) months prior to the last day of the initial Term of the Lease or first Renewal Period, as applicable, and the failure to timely exercise such right shall mean that such Renewal Option (and any remaining Renewal Option) is null and void.

27. RIGHT OF FIRST OFFER . Tenant shall have a right of first offer to lease Suite 401 in the Building, subject to the terms and conditions set forth on Exhibit G attached hereto and made a part hereof.

28. HURRICANE SHUTTERS . Landlord shall, at no additional cost to Tenant, furnish hurricane shutters and install tracks for the installation of same on the exterior of the Building Premises. Tenant shall be solely responsible for installing (and thereafter removing) the hurricane shutters in the event of a hurricane warning in effect, and storing the hurricane shutters when not in use.

29. UNCONDITIONAL GUARANTY . Simultaneously with the execution and delivery of this Lease, Tenant shall cause Mayor’s Jewelers, Inc. to execute and deliver to Landlord an unconditional guaranty of all of the obligations of Tenant under the Lease in the form of Unconditional Guaranty set forth on Exhibit H attached hereto and made a part hereof.

30. WAIVER OF TRIAL BY JURY . LANDLORD AND TENANT, TO THE FULLEST EXTENT THAT THEY MAY LAWFULLY DO SO, HEREBY WAIVE TRIAL BY JURY IN ANY ACTION OR PROCEEDING BROUGHT BY ANY PARTY TO THIS LEASE WITH RESPECT TO THIS LEASE, THE PREMISES, OR ANY OTHER MATTER RELATED TO THIS LEASE OR THE PREMISES.

31. LANDLORD’S COVENANTS; NO TERMINATION RIGHT . All obligations of Landlord hereunder shall be construed as covenants, not conditions; and, except as may be otherwise expressly provided in this Lease, Tenant may not terminate, and to the extent permitted by law, waives the benefit of any law now or hereafter in effect which would permit Tenant to terminate, this Lease for breach of Landlord’s obligations hereunder.

32. SHORT FORM LEASE . Tenant acknowledges that, in light of the particular nature of the tenancy created hereunder, Landlord has agreed to utilize this “Short Form” Lease rather than Landlord’s standard form of multi-tenant lease.

33. OFAC . Tenant represents and warrants that neither it nor any of its officers or directors is, and that, to the actual knowledge of the signatory to this Lease, none of its employees, representatives, or agents is, a person or entity with whom U.S. persons or entities are restricted from doing business under regulations of the Office of Foreign Asset Control (“ OFAC ”) of the Department of the Treasury (including those named on OFAC’s Specially Designated and Blocked Persons List) or under any statute, executive order (including the September 24, 2001, Executive Order Blocking Property and Prohibiting Transactions with Persons Who Commit, Threaten to Commit, or Support Terrorism), or other governmental regulation, and that it will not transfer the Lease to, or knowingly contract with or otherwise engage in any dealings or transactions or be otherwise associated with such persons or entities. Tenant represents and warrants that it is currently in compliance with, and shall at all times during the Term of the Lease remain in compliance with, the regulations of OFAC and any other governmental requirement relating thereto.

34. RADON DISCLOSURE . In accordance with Florida Statute 404.056 effective January 1, 1989, the following information is provided:

Radon Gas: Radon is a naturally occurring radioactive gas that when it has accumulated in a building in sufficient quantities, may present health risks to persons who are exposed to it over time. Levels of radon that exceed federal and state guidelines have been found in buildings in Florida. Additional information regarding radon and radon testing may be obtained from your county public health unit.

[THE REST OF THIS PAGE IS INTENTIONALLY LEFT BLANK AND SIGNATURE BLOCKS ARE LOCATED ON THE FOLLOWING PAGE]

IN WITNESS WHEREOF , Landlord and Tenant have duly executed this Lease as of the day and year first above written.


LANDLORD:		TENANT:

SPG PALM CROSSING LLC , a Florida limited liability company		MAYOR’S JEWELERS OF FLORIDA, INC. , a Florida corporation

By:	/s/ Kenneth Mayer	By:	/s/ Kevin Kirner
Name:	Kenneth Mayer	Name:	Kevin Kirner
Title:	Vice President	Title:	Director Retail Administration
Date:	4-11-17	Date:	April 7, 2017


Address:						Address:

c/o Seagis Property Group LP						c/o Birks Group Inc.
100 Front Street, Suite 350						1240 Phillips Square
West Conshohocken, PA 19428						Montreal, Qc H3B 3H4
Attn: Charles C. Lee						Attn: Vice President, Legal Affairs & Corporate Secretary


LANDLORD WITNESSED BY:		TENANT WITNESSED BY:

By:	/s/ Alyssa Petrick	By:	/s/ Naomi Bendayen
Name:	Alyssa Petrick	Name:	Naomi Bendayen
Date:	4-11-2017	Date:	April 7, 2017

LANDLORD WITNESSED BY:		TENANT WITNESSED BY:

By:	/s/ Lori Daly	By:	/s/ Lesly Wright
Name:	Lori Daly	Name:	Lesly Wright
Date:	4/11/17	Date:	April 7, 2017

ADDENDUM 1

STORAGE AND USE OF PERMITTED HAZARDOUS MATERIALS

Permitted Hazardous Materials . The terms and provisions of this Addendum 1 shall be in addition to and not in limitation of the terms and provisions of the Lease. Tenant has requested Landlord’s consent to use the Hazardous Materials listed below in its business at, or in connection with, the Premises (the “ Permitted Hazardous Materials ”), in the maximum quantities and for the specific purpose otherwise set forth across from each such listed item:


Hazardous Material	Maximum Quantities	Specified Use

Rhodium platinum solution	1 Quart	Plating of silver and gold jewelry

Electroplating solution	1 Quart	For electroplating metal

Dry acid	1 Quart	To remove tarnish from jewelry

All Permitted Hazardous Materials shall be in their original sealed and unopened containers, not subject to repackaging, and without imminent risk of a release. The rights set forth herein are limited to storage and use only, not generation at the Premises, and all Permitted Hazardous Materials shall be stored inside the Building on concrete or other impervious surface (and shall not be racked) with secondary containment where required or prudent. Notwithstanding anything to the contrary herein or at law, Tenant shall ensure that any Permitted Hazardous Materials on the Premises will be received, maintained, treated, stored, used, and disposed of in a manner consistent with good engineering practice and in compliance with all Environmental Laws and the standards established by the National Fire Protection Association.

2.	No Current Investigation . Tenant represents and warrants that it is not currently subject to an inquiry, regulatory investigation, enforcement order, or any other proceeding regarding the generation, use, treatment, storage, or disposal of a Hazardous Material.

Notice and Reporting . Tenant shall immediately notify Landlord in writing of any spill, release, discharge, or disposal of any Hazardous Material in, on or under the Premises. All reporting obligations imposed by Environmental Laws are strictly the responsibility of Tenant. Tenant shall supply to Landlord within five (5) business days after Tenant first receives or sends the same, copies of all claims, reports, complaints, notices, warnings or asserted violations relating in any way to Tenant’s use of the Premises.

Indemnification . Tenant’s indemnity obligation under the Lease with respect to Hazardous Materials shall include indemnification for the liabilities, expenses and other losses described therein as a result of the use of the Permitted Hazardous Materials or the breach of Tenant’s obligations or representations set forth above. It is the intent of this provision that Tenant be strictly liable to Landlord as a result of the use of Permitted Hazardous Materials without regard to the fault or negligence of Tenant, Landlord or any third party.

Disposal Upon Lease Termination . At the expiration or earlier termination of the Lease, Tenant, at its sole cost and expense, shall: (i) remove and dispose off-site any drums, containers, receptacles, structures, or tanks storing or containing Hazardous Materials (or which have stored or contained Hazardous Materials) and the contents thereof which are located at the Premises as a result (directly or indirectly) of Tenant’s and/or any of Tenant’s Parties use of the Premises; (ii) remove, empty, and purge all underground and above ground storage tank systems, including connected piping, of all vapors, liquids, sludges and residues, which are located at the Premises as a result (directly or indirectly) of Tenant’s and/or any of Tenant’s Parties use of the Premises; and (iii) restore the Premises in accordance with Section 21 of the Lease. Such activities shall be performed in compliance with all Environmental Laws and to the satisfaction of Landlord. Landlord’s satisfaction with such activities or the condition of the Premises does not waive, or release Tenant from, any obligations hereunder.

EXHIBIT A

SITE PLAN OF PREMISES

LOGO

A-1

EXHIBIT B

TENANT OPERATIONS INQUIRY FORM


1.		Name of Company/Contact



2.		Address/Phone



3.		Provide a brief description of your business and operations:



4.		Will you be required to make filings and notices or obtain permits as required by Federal and/or State regulations for the operations at the proposed facility? Specifically:

a. SARA Title III Section 312 (Tier II) reports

YES

(> 10,000lbs. of hazardous materials STORED at any one time)

b. SARA Title III Section 313 (Tier III) Form R reports

YES

(> 10,000lbs. of hazardous materials USED per year)

c. NPDES or SPDES Stormwater Discharge permit

YES

(answer “No” if “No-Exposure Certification” filed)

d. EPA Hazardous Waste Generator ID Number

YES

5. Provide a list of chemicals and wastes that will be used and/or generated at the proposed location. Routine office and cleaning supplies are not included. Make additional copies if required.


		Storage Container(s)
Chemical/Waste	Approximate Annual Quantity Used or Generated	(i.e. Drums, Cartons, Totes, Bags, ASTs, USTs, etc)

EXHIBIT C

LEASE COMMENCEMENT CERTIFICATE

DATE

Tenant Name

Address

Re: Short Form Industrial Building Lease (the “ Lease ”) dated , 20 , [as amended on ] , for premises located at by and between (“ Landlord ”), and (“ Tenant ”).

Capitalized terms used herein but not defined shall be given the meanings assigned to them in the Lease.

Condition of Premises . Tenant has accepted possession of the Premises pursuant to the Lease. Any improvements required by the terms of the Lease to be made by Landlord have been completed to the full and complete satisfaction of Tenant in all respects except for the punch list items described on Exhibit A hereto (the “ Punch List Items ”), and except for such Punch list Items, Landlord has fulfilled all of its duties under the Lease with respect to such initial tenant improvements. Furthermore, Tenant acknowledges that the Premises are suitable for the Permitted Use.

[Base Rent due and owing for the month of , 20 will be pro-rated for the period , 20 through , 20 totaling $ .] For the month of , 20 , Base Rent due and owing will be $ per month inclusive of Sales Tax, and shall increase thereafter in accordance with the terms and conditions of the Lease. Notwithstanding the foregoing, Rent is due and payable on the first (1 ^st ) of each month for the remainder of the Term or late fees will apply per the terms of the Lease.

Ratification . Tenant hereby ratifies and confirms its obligations under the Lease.

Binding Effect; Governing Law . Except as modified hereby, the Lease shall remain in full effect and this letter shall be binding upon Landlord and Tenant and their respective successors and assigns. If any inconsistency exists or arises between the terms of this letter and the terms of the Lease, the terms of this letter shall prevail. This letter shall be governed by the laws of the state in which the Premises are located.

If you disagree with any of the information set forth above, please advise our office in writing within five (5) days of receipt of this letter; otherwise the information will be as set forth above.


Sincerely,



By:
Name:
Title:

EXHIBIT A TO LEASE COMMENCEMENT CERTIFICATE

Punch List Items

EXHIBIT D

EXCLUSIVE PARKING

EXHIBIT E

PHASE I IMPROVEMENTS

LOGO

Scope of TI:

PHASE 1

Front Offices (Existing offices)

Replace break room cabinets with similar. Re-use sink.

Perform demolition as needed to create large Distribution center. Patch all walls flush to adjacent finishes and paint.

Install new ceiling to match existing in new Distribution Center – redistribute existing lighting and assume adding 4 lights in this area.

Modify existing HVAC distribution as needed to accommodate new layout.

Assume adding 6 duplex outlets to supplement existing outlets remaining on perimeter walls of new Distribution Center.

Existing bathrooms to remain unchanged.

Warehouse area (New Offices)

Ceiling to remain – replace 50% of ceiling tiles that may be stained, discolored.

Construct all walls, doors, etc as shown in plan. Walls to extend up to existing ceiling @ +/-12’.

Install new a/c split system unit to accommodate the plan changes, assume 3 tons

Provide and install counter in security and in 2 rooms adjacent to security. Racking and furniture by tenant.

Provide and install 2 sinks in the two rooms opposite the existing bathrooms.

Floor finishes are identified on attached.

Provide electrical and data locations as shown on attached.

Provide new LED lighting in Services Rm, Jewelers, and Watches.

Add Alternates:

Existing Offices - Remove and replace carpet throughout including vinyl wall base.

Existing Offices - Replace VCT in Break Room including vinyl wall base.

Existing Offices - Remove existing 6 office doors on building front and replace with full glass doors. Including patch/paint.

Existing Offices - Replace all existing lay in light fixtures with Cooper Lighting 2EP3GX-332S36I-UNV-EB81-U Metalux ^® 3-Light 18 Cells Parabolic Lighting; 96 Watt, Baked White Enamel, Standard Lay-In-Grid Mount

Vault – Concrete Footings to be installed beneath vault walls and columns

Vault – Structural Engineering and Core Samples

LOGO

11340 Interchange Circle North | Miramar, Fl 33025

www.seagisproperty.com

1 of 2

EXHIBIT E-1

PHASE II IMPROVEMENTS

LOGO

PHASE 2

Exterior

Construct secure loading area as shown on plans. Walls to be constructed of masonry or concrete up to 6’ high with 6’ of chain link fence. Stucco finish and paint.

Provide and install aluminum gate at truck loading This gate is to be motorized with remote switch inside Storage.

Install new roll up door, motorized, including cutting and reinforcing for new opening.

Install new man door aside new roll up door.

Remove and infill existing roll up door. Masonry or concrete infill with stucco finish. Paint entire exterior wall (this wall only).

Qualifications:

Tenant has not provided specifications for all equipment being installed. This proposal assumes there is adequate power to the building.

Proposal does not include costs associated with the Vault installation, supervision, coordination of components that interface with vault (elect, lighting, A/C, etc). This scope of work and cost is TBD.

Exterior work to building is pending final design & engineering & permitting.

Data locations will be provided with a j-box and stub up above ceiling. Tenant vendor to provide cabling and terminations.

Security Alarm, Cameras and door access components are to be furnished and installed by Tenant.

All appliances and FF&E by Tenant.

All floor finishes, paint, etc to be Landlord Standards. Colors to be selected by Tenant.

LOGO

11340 Interchange Circle North | Miramar, Fl 33025

www.seagisproperty.com

2 of 2

EXHIBIT E-2

LANDLORD’S WORK

LOGO

EXHIBIT F

FAIR MARKET RENT DETERMINATION

(a) If Tenant timely exercises a Renewal Option, Landlord shall send to Tenant, within fifteen (15) days of Landlord’s receipt of Tenant’s exercise notice, a notice (the “ Fair Market Value Rental Notice ”) setting forth Landlord’s designation of the fair market value of Base Rent for the Premises for the applicable Renewal Period (the “ Fair Market Value Rental ”). Landlord and Tenant shall promptly commence negotiations in an effort to reach a mutually acceptable determination of the Fair Market Value Rental. If, within thirty (30) days after the date of the Fair Market Value Rental Notice, Landlord and Tenant have not agreed upon in writing a mutually acceptable Fair Market Value Rental, then, by the close of business on the tenth (10th) business day following the end of such 30-day period each of Landlord and Tenant will submit to the other its final proposed Fair Market Value Rental. If either party fails to timely submit its final proposed Fair Market Value Rental to the other as required above, then the Fair Market Value Rental shall be deemed to be that submitted by the party who has so timely acted.

(b) Within ten (10) Business Days after the last of Landlord’s or Tenant’s proposed Fair Market Value Rental is submitted, each of Landlord and Tenant will appoint a person who is an appraiser and a member of the American Institute of Real Estate Appraisers, with not less than ten (10) years’ commercial/industrial experience in the Fort Lauderdale, Florida area (each, an “ Arbitrator ”) and with experience in leasing similar properties. The two (2) Arbitrators so appointed shall appoint an impartial third Arbitrator, similarly qualified, who has no business relationship with either Landlord or Tenant, within ten (10) days after the appointment of the last appointed Arbitrator, and shall notify the parties of the identity of such third Arbitrator. If the two (2) Arbitrators are unable to agree upon a third Arbitrator, either Landlord or Tenant may, upon not less than five (5) business days’ written notice to the other party, apply to the American Arbitration Association for appointment of a third similarly qualified Arbitrator. The three (3) Arbitrators are referred to in this Lease as the “ Arbitration Panel .” Within fifteen (15) days after the appointment of the third Arbitrator, the Arbitration Panel shall (i) conduct a hearing, at which Landlord and Tenant may each make supplemental oral and/or written presentations, with an opportunity for questioning by the members of the Arbitration Panel and (ii) select either the Landlord’s proposed Fair Market Value Rental or the Tenant’s proposed Fair Market Value Rental as the Fair Market Value Rental, which designation will constitute the Fair Market Value Rental for purposes of determining Base Rent for the applicable Renewal Period. The determination of the Arbitration Panel shall be limited solely to the issue of whether Landlord’s or Tenant’s proposed Fair Market Value Rental is closest to the actual Fair Market Value Rental, and the Arbitration Panel will have no right to propose a middle ground or to modify either of the two (2) proposals. The decision of a majority of the three (3) members of the Arbitration Panel shall be binding upon Landlord and Tenant. In the event of the failure, refusal or inability of an Arbitrator to act, a successor shall be appointed in the same manner as the original Arbitrator. Each party shall pay any cost of the Arbitrator selected by such party (and their own attorneys and consultants) and one half of the cost of the third Arbitrator so selected plus one half of any other costs incurred in resolving the disagreement regarding the Fair Market Value Rental.

(c) If Landlord and Tenant reach agreement regarding the Fair Market Value Rental, or if the Arbitration Panel determines the Fair Market Value Rental, then, within thirty (30) days, the parties shall execute an amendment to this Lease confirming the terms and conditions applicable to the applicable Renewal Period, including the newly extended expiration date and the Base Rent determined in accordance with Section 26 of this Lease.

EXHIBIT G

RIGHT OF FIRST OFFER

Landlord hereby covenants and agrees that Tenant shall have a one-time “ Right of First Offer ” to lease that certain space in the Building commonly known as Suite 401, as depicted on Exhibit A (the “ Additional Space ”) provided that the Additional Space is available and Landlord is prepared to offer the Additional Space for lease to a third party during the Term of the Lease. Such Right of First Offer is granted on and subject to the following terms and conditions:

1. If, when and as (a) Landlord becomes aware that the Additional Space will become available for lease to a third party, and (b) Landlord is prepared to offer the Additional Space for lease to a third party tenant, Landlord shall promptly notify Tenant, in writing (a “ ROFO Notice ”). Tenant shall then have the right to lease the Additional Space on the terms and conditions hereinafter set forth.

2. The ROFO Notice shall describe the economic and other relevant terms and conditions upon which Landlord is prepared to offer to lease the Additional Space to a third party tenant (the “ ROFO Terms ”), including, but not limited to, the term for which the Additional Space is to be leased; the commencement date of that lease term; the per annum, per square foot base rent proposed to be charged by Landlord for the Additional Space (the “ Rental Rate ”); and all (if any) monetary concessions that Landlord is prepared to offer to such third party in consideration of its proposed lease of the Additional Space.

3. Upon Landlord’s delivery of the ROFO Notice, Tenant shall have five (5) business days in which to advise Landlord, in writing (the “ ROFO Response ”), whether or not Tenant desires to exercise its Right of First Offer and lease all (but not some portion) of the Additional Space on all of the ROFO Terms, except as otherwise specifically provided below in this Exhibit G .

4. If Tenant fails to timely deliver a ROFO Response (or, if Tenant timely delivers the ROFO Response, but declines to lease all of the Additional Space on the ROFO Terms), then Tenant shall automatically be deemed to have waived its Right of First Offer and this Right of First Offer shall be deemed null and void and of no further force and effect (except as otherwise provided in Paragraph 6 below). In that event, Landlord shall be free to lease the Additional Space to one or more third party tenants (a “ ROFO Lease ”) on substantially the same or better (from Landlord’s perspective) terms as are set forth in the ROFO Notice previously delivered to Tenant and this Right of First Offer shall be null and void.

5. If Tenant timely delivers an ROFO Response and advises Landlord of its desire to lease the entirety of the Additional Space on the ROFO Terms set forth in the applicable ROFO Notice, then, within ten (10) business days of Tenant’s delivery of the ROFO Response to Landlord, Landlord and Tenant shall execute and enter into an amendment to this Lease, pursuant to which amendment Tenant shall lease the Additional Space on all of the terms, conditions and limitations set forth in this Lease, except that (i) the annual Base Rent for the Additional Space shall be the product of (x) the Rental Rate and (y) the number of rentable square feet comprising the Additional Space (and subject to such escalations as are provided in the ROFO Terms); (ii) Tenant’s Proportionate Share shall be appropriately adjusted (increased) to account for the additional square footage comprising the Additional Space; (iii) the definition of the Premises shall be amended to include the Additional Space; and (iv) the Term of this Lease shall remain unchanged with respect to the Premises initially leased hereunder; however, the Term of this Lease for the Additional Space only shall be as set forth in the ROFO Terms. Notwithstanding anything to the contrary contained in this Lease or in the ROFO Notice, if Tenant timely delivers a ROFO Response, Tenant shall be obligated to lease the entirety of that Additional Space on a strictly “as-is,” “where-is” basis, without any tenant improvements, allowances, inducements, alterations, modifications, representations or warranties of any nature whatsoever from Landlord.

6. In the event that (a) Landlord delivers an ROFO Notice, but Tenant fails to timely deliver an ROFO Response; and (b) therefore, Landlord has the right to, and does, actively pursue the negotiation of the terms and conditions of a ROFO Lease, but in the course of such pursuit, Landlord desires to modify or amend any of the ROFO Terms in any material respect, then Landlord may not finalize the terms and conditions of, execute, and enter into a ROFO Lease, based on and incorporating a material change in the ROFO Terms, without once again first

delivering a revised ROFO Notice to Tenant, reflecting the then-applicable ROFO Terms, whereupon the provisions of Sections 3 through 5 above shall once again apply. For purposes of this Section 6, a modification of the Rental Rate originally included in the ROFO Terms shall be deemed material if that Rental Rate is reduced by more than ten percent (10%) of the Rental Rate originally offered to Tenant, but such determination of materiality shall be made without regard to any terms other than the Rental Rate.

7. Tenant specifically acknowledges and agrees that its Right of First Offer shall not apply to (i) the renewal, relocation, expansion or extension of any existing lease of Landlord, whether pursuant to a renewal right, expansion right, relocation right or otherwise; or (ii) when less than two (2) years remain during the Term (as may be extended) or when the term applicable to the Additional Space under the ROFO Terms exceeds the remaining Term of this Lease.

8. Tenant shall have no right to exercise (or to preserve the prior exercise of) the Right of First Offer if and to the extent that Tenant is in default under the Lease at either or both of (a) the date Landlord would otherwise be obligated to deliver a ROFO Notice; and (b) at any time thereafter prior to the applicable commencement date for the lease of the Additional Space (after timely delivery of a ROFO Response by Tenant). In the event of such a default by Tenant, Tenant shall be deemed to have irrevocably waived its Right of First Offer during the period of time that any such default remains uncured (to Landlord’s satisfaction); therefore, (i) during a period of default, Landlord shall have no obligation to deliver a ROFO Notice; and (ii) if Landlord delivers a ROFO Notice, and Tenant timely delivers a ROFO Response, advising of Tenant’s election to lease the Additional Space, but Tenant then defaults after its delivery of the ROFO Response, then such ROFO Response shall immediately be automatically and irrevocably rendered null and void, whereupon Landlord shall be free to lease the Additional Space to any party Landlord desires, and on whatever terms Landlord deems appropriate.

9. The Right of First Offer is personal to Tenant and to its affiliates or subsidiaries (“Permitted Transferees”), subject to Section 8 of this Lease. If Tenant subleases any portion of the Premises or assigns or otherwise transfers all or any portion of Tenant’s interest under the Lease to any other person or entity (other than a Permitted Transferee), whether or not pursuant to, and in accordance with, the requirements of this Lease, neither Tenant nor any sublessee, assignee or transferee shall have, or be entitled to, any of the rights or benefits of the Right of First Offer.

10. The Right of First Offer is in all events subject and subordinate to any existing rights or options of other parties to lease.

EXHIBIT H

UNCONDITIONAL GUARANTY

THIS UNCONDITIONAL GUARANTY (the “Guaranty”) is made as of this day of , 201 , by Mayor’s Jewelers, Inc., a Delaware corporation (the “Guarantor”), in favor of SPG Palm Crossing LLC, a Florida limited liability company (the “Landlord”), and is executed pursuant to that certain Lease of even date herewith, by and between Landlord and Mayor’s Jewelers of Florida, Inc., a Florida corporation (the “Tenant”), as same may be amended or modified from time to time (collectively, the “Lease”). The Lease is with respect to those certain Premises, as defined in the Lease, located in the building commonly known as 3440 NW 53 ^rd Street, Fort Lauderdale, Florida.

In order to induce Landlord to execute the Lease, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Guarantor has guaranteed and hereby does guaranty the payment and performance of all liabilities, obligations, and duties (including, without limitation, payment of rent) imposed upon Tenant under the terms of the Lease, as if Guarantor has executed the Lease as Tenant thereunder, irrespective of the expiration of the Lease, the invalidity or unenforceability of the Lease or any provision therein, or the insufficiency, invalidity, or unenforceability of any security interest which might have been, or be hereafter, given to Landlord to secure Tenant’s obligations contained in the Lease.

Guarantor hereby acknowledges, and waives notice of, acceptance of this Guaranty and all other notices in connection herewith or in connection with the liabilities, obligations, and duties guaranteed hereby, including, but not limited to, notices of default by or to Tenant under the Lease, and waives demand for payment, protest, diligence, presentment, notice of protest, obligation, or duty guaranteed hereby. Guarantor further waives to the fullest extent permitted by law, all defenses given to sureties and guarantors by statute, at law, or in equity.

Guarantor further agrees that Landlord shall not be first required to enforce against Tenant or any other person any liability, obligation, or duty guaranteed hereby before seeking enforcement thereto against Guarantor. Suit may be brought and maintained against Guarantor by Landlord to enforce any liability, obligation, or duty guaranteed hereby without joinder of Tenant or any other person. The liability of Guarantor shall not be affected by any indulgence, compromise, settlement, or variation of terms which may be extended to Tenant by Landlord or agreed upon by Landlord and Tenant, and shall not be impaired, modified, changed, released, or limited in any manner whatsoever by any impairment, modification, change, release, or limitation of the Lease or the liability of Tenant or its estate in bankruptcy, or of any remedy for the enforcement thereof, resulting from the operation of any present or future provision of the National Bankruptcy Code, or any similar law or statute of the United States or any State thereof. Landlord and Tenant, without notice to, or consent by, Guarantor, may at any time or times enter into such extensions, amendments, assignments, subleases, or other covenants respecting the Lease as they may deem appropriate, including, but not limited to, an increase in the rent due under the Lease or any other obligation thereunder; and Guarantor shall not be released thereby, but shall continue to be fully liable for the payment and performance of all liabilities, obligations, and duties of Tenant under the Lease as so extended, amended, assigned, subleased, or otherwise modified.

This Guaranty is absolute, unconditional, and continuing in any event, and shall not terminate until the payment of all sums and the performance of all obligations evidenced by the Lease.

It is understood that other agreements similar to this Guaranty may, at Landlord’s sole opinion and discretion, be executed by other persons with respect to the Lease. This Guaranty shall be joint and several and cumulative of any such agreements and the liabilities and obligations of Guarantor hereunder shall in no event be affected or diminished by reason of such other agreements. Moreover, if Landlord obtains the signature of more than one guarantor in this Guaranty, or obtains additional guaranty agreements, or both, Guarantor agrees that Landlord, in Landlord’s sole discretion, may (i) bring suit against all guarantors of the Lease jointly and severally or against any one or more of them, (ii) compound or settle with any one or more of the guarantors for such consideration as Landlord may deem proper, and (iii) release any one or more of the guarantors from liability. Guarantor further agrees that no such action shall impair the rights of Landlord to enforce the Lease against any remaining guarantor or guarantors, including Guarantor.

Guarantor agrees that if Landlord shall employ an attorney to present, enforce, or defend any or all of Landlord’s rights or remedies hereunder or under the Lease, Guarantor shall pay any reasonable attorneys’ fees incurred by Landlord in with respect thereto, whether such fees are incurred before or at trial or on appeal.

In the event the Landlord, or any successor owner of the Building, sells, conveys, or otherwise transfers the Building or the Lease, this Guaranty shall not be abrogated thereby, and shall continue in full force and effect.

This Guaranty shall be governed by, and construed in accordance with, the laws of the State of Florida, without application of conflict of laws principles. If any provision of this Guaranty should be held to be invalid or unenforceable, the validity and enforceability of the remaining provisions of this Guaranty shall not be affected thereby.

This Guaranty shall be binding upon Guarantor and Guarantor’s successors, heirs, executors, administrators, and assigns, and shall inure to the benefit of Landlord and Landlord’s successors, heirs, executors, administrators, and assigns.

GUARANTOR HEREBY KNOWINGLY AND VOLUNTARILY WAIVES TRIAL BY JURY IN ANY ACTION, PROCEEDING, OR COUNTERCLAIM BROUGHT BY LANDLORD AGAINST GUARANTOR ON ANY MATTERS ARISING OUT OF OR IN ANY WAY CONNECTED WITH THE LEASE OR THIS GUARANTY. GUARANTOR ACKNOWLEDGES AND AGREES THAT SUCH WAIVER IS A MATERIAL INDUCEMENT TO LANDLORD ENTERING INTO THE LEASE.

EXECUTED as of the day and year first above written.


GUARANTOR :



By:
Name:
Title:


Address:


STATE OF		}
		ss.:
COUNTY OF		}

On the day of , in the year , before me, the undersigned, personally appeared personally known to me or proved to me on the basis of satisfactory evidence to be the individual whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his capacity, and that by his signature on the instrument, the individual, or the person upon behalf of which the individual acted, executed the instrument [, and that such individual made such appearance before the undersigned in the County of , State of .]

Notary Public

EXHIBIT I

SNDA

SUBORDINATION, NONDISTURBANCE, AND ATTORNMENT AGREEMENT

This SUBORDINATION, NONDISTURBANCE, AND ATTORNMENT AGREEMENT (this “ Agreement ”) is entered into as of , 20 (the “ Effective Date ”), between BANK OF AMERICA, N.A., a national banking association, whose address is 1600 JFK Boulevard, Philadelphia, PA 19103, Attention: Commercial Real Estate Banking (“ Lender ”), and , a , whose address is (“ Tenant ”), with reference to the following facts:

A. , a , whose address is 100 Front Street, Suite 350, Conshohocken, Pa 19428 (“ Landlord ”), owns the real property located at (such real property, including all buildings, improvements, structures and fixtures located thereon, “ Landlord’s Premises ”), as more particularly described in Schedule A .

B. Lender has made a loan to Landlord in the original principal amount of $75,000,000, which amount is subject to possible increase (the “ Loan ”), all as provided in and subject to the terms and conditions set forth in the Loan Documents (as hereinafter defined).

C. To secure the Loan, Landlord has encumbered Landlord’s Premises by entering into that certain Revolving Credit Agreement, Assignment of Rents, Security Agreement and Fixture Filing dated November 20, 2012, for the benefit of Lender as amended, increased, renewed, extended, spread, consolidated, severed, restated, or otherwise changed from time to time, the “ Mortgage ”) recorded [on , in Book , Page ,] in the [Public] [Official] Records of County, (the “ Official Records ”).

D. Pursuant to a , dated as of , 20 , as amended on , 20 and , 20 (the “ Lease ”); Landlord demised to Tenant [a portion of] Landlord’s Premises (“ Tenant’s Premises ”). Tenant’s Premises are commonly known as .

[E. Pursuant to a dated as of , 20 , guaranteed the obligations of Tenant under the Lease.]

F. Tenant and Lender desire to agree upon the relative priorities of their interests in Landlord’s Premises and their rights and obligations if certain events occur.

NOW, THEREFORE, for good and sufficient consideration and intending to be legally bound hereby, Tenant and Lender agree:

1. Definitions . The following terms shall have the following meanings for purposes of this Agreement.

1.1 “ Civil Asset Forfeiture Reform Act ” means the Civil Asset Forfeiture Reform Act of 2000 (18 U.S.C. Sections 983 et seq.), as amended from time to time, and any successor statute.

1.2 “ Construction-Related Obligation(s) ” means any obligation of Landlord under the Lease to make, pay for, or reimburse Tenant for any alterations, demolition, or other improvements or work at Landlord’s Premises, including Tenant’s Premises. Construction-Related Obligations shall not include: (a) reconstruction or repair following fire, casualty or condemnation; or (b) day-to-day maintenance and repairs.

1.3 “ Controlled Substances Act ” means the Controlled Substances Act (21 U.S.C. Sections 801 et seq.), as amended from time to time, and any successor statute.

1.4 “ Foreclosure Event ” means: (a) foreclosure under the Mortgage, whether by judicial action or pursuant to nonjudicial proceedings; (b) any other exercise by Lender of rights and remedies (whether under the Mortgage or under applicable law, including bankruptcy law) as holder of the Loan and/or [the Mortgage] [as beneficiary under the Mortgage], as a result of which any Successor Landlord becomes owner of Landlord’s Premises; or (c) delivery by Landlord to Lender (or its designee or nominee) of a deed or other conveyance of Landlord’s interest in Landlord’s Premises in lieu of any of the foregoing.

1.5 “ Former Landlord ” means Landlord and any other party that was landlord under the Lease at any time before the occurrence of any attornment under this Agreement.

1.6 “ Loan Documents ” mean the Mortgage and any other document now or hereafter evidencing, governing, securing or otherwise executed in connection with the Loan, including any promissory note and/or loan agreement, pertaining to the repayment or use of the Loan proceeds or to any of the real or personal property, or interests therein, securing the Loan, as such documents or any of them may have been or may be from time to time hereafter renewed, extended, supplemented, increased or modified. This Agreement is a Loan Document.

1.7 “ Offset Right ” means any right or alleged right of Tenant to any offset, defense (other than one arising from actual payment and performance, which payment and performance would bind a Successor Landlord pursuant to this Agreement), claim, counterclaim, reduction, deduction, or abatement against Tenant’s payment of Rent or performance of Tenant’s other obligations under the Lease, arising (whether under the Lease or other applicable law) from Landlord’s breach or default under the Lease.

1.8 “ Rent ” means any fixed rent, base rent or additional rent under the Lease.

1.9 “ Successor Landlord ” means any party that becomes owner of Landlord’s Premises as the result of a Foreclosure Event.

1.10 “ Termination Right ” means any right of Tenant to cancel or terminate the Lease or to claim a partial or total eviction arising (whether under the Lease or under applicable law) from Landlord’s breach or default under the Lease.

2. Subordination . The Lease, including all rights of first refusal, purchase options and other rights of purchase, shall be, and shall at all times remain, subject and subordinate to the Mortgage, the lien and security interest imposed by the Mortgage and the right to enforce such lien or security interest, and all advances made under or secured by the Loan Documents. Tenant hereby intentionally and unconditionally subordinates the Lease and all of Tenant’s right, title and interest thereunder and in and to Landlord’s Premises (including Tenant’s right, title and interest in connection with any insurance proceeds or eminent domain awards or compensation relating to Landlord’s Premises and Tenant’s right to receive and retain any rentals or payments made under any sublease or concession agreement of or

relating to any portion of Tenant’s Premises), to the lien of the Mortgage and all of Lender’s rights and remedies thereunder, and agrees that the Mortgage shall unconditionally be and shall at all times remain a lien on Landlord’s Premises prior and superior to the Lease.

3. Nondisturbance; Recognition; and Attornment .

3.1 No Exercise of Mortgage Remedies Against Tenant . So long as the Lease has not been terminated on account of Tenant’s default that has continued beyond applicable cure periods (an “ Event of Default ”), Lender shall not name or join Tenant as a defendant in any judicial action or proceeding that is commenced pursuant to the exercise of Lender’s rights and remedies arising upon a default by Landlord under the Mortgage unless (a) applicable law requires Tenant to be made a party thereto as a condition to proceeding against Landlord or in order to prosecute or otherwise fully enforce such rights and remedies; or (b) such joinder of Tenant is required for the recovery by Lender of any Rent at any time owing by Tenant under the Lease, whether pursuant to the assignment of rents set forth in the Mortgage or otherwise; or (c) such joinder is required in order to enforce any right of Lender to enter Landlord’s Premises for the purpose of making any inspection or assessment, or in order to protect the value of Lender’s security provided by the Mortgage. In any instance in which Lender is permitted to join Tenant as a defendant as provided above, Lender agrees not to terminate the Lease or otherwise adversely affect Tenant’s rights under the Lease or this Agreement in or pursuant to such action or proceeding, unless an Event of Default by Tenant has occurred and is continuing. The foregoing provisions of this Section shall not be construed in any manner that would prevent Lender from (i) carrying out any nonjudicial foreclosure proceeding under the Mortgage, or (ii) obtaining the appointment of a receiver for the Landlord’s Premises as and when permitted under applicable law.

3.2 Nondisturbance and Attornment . If the Lease has not been terminated on account of an Event of Default by Tenant, then, when Successor Landlord takes title to Landlord’s Premises: (a) Successor Landlord shall not terminate or disturb Tenant’s possession of Tenant’s Premises under the Lease, except in accordance with the terms of the Lease and this Agreement; (b) Successor Landlord shall be bound to Tenant under all the terms and conditions of the Lease (except as provided in this Agreement); (c) Tenant shall recognize and attorn to Successor Landlord as Tenant’s direct landlord under the Lease as affected by this Agreement; and (d) the Lease shall continue in full force and effect as a direct lease, in accordance with its terms (except as provided in this Agreement), between Successor Landlord and Tenant.

3.3 Use of Proceeds . Lender, in making any advances of the Loan pursuant to any of the Loan Documents, shall be under no obligation or duty to, nor has Lender represented to Tenant that it will, see to the application of such proceeds by the person or persons to whom Lender disburses such advances, and any application or use of such proceeds for purposes other than those provided for in any Loan Document shall not defeat Tenant’s agreement to subordinate the Lease in whole or in part as set forth in this Agreement.

3.4 Further Documentation . The provisions of this Article shall be effective and self-operative without any need for Successor Landlord or Tenant to execute any further documents. Tenant and Successor Landlord shall, however, confirm the provisions of this Article in writing upon request by either of them.

3.5 Default Under Mortgage . In the event that Lender notifies Tenant of a default under the Mortgage and demands that Tenant pay its rent and all other sums due under the Lease directly to Lender, Tenant shall honor such demand and pay the full amount of its rent and all other sums due under the Lease directly to Lender, without offset, or as otherwise required pursuant to such notice beginning with

the payment next due after such notice of default, without inquiry as to whether a default actually exists under the Mortgage and notwithstanding any contrary instructions of or demands from Landlord. The consent and approval of Landlord to this Agreement shall constitute an express authorization for Tenant to make such payments to Lender and a release and discharge of all liability of Tenant to Landlord for any such payments made to Lender in compliance with Lender’s written demand.

4. Protection of Successor Landlord . Notwithstanding anything to the contrary in the Lease or the Mortgage, Successor Landlord shall not be liable for or bound by any of the following matters:

4.1 Claims Against Former Landlord . Any Offset Right that Tenant may have against any Former Landlord relating to any event or occurrence before the date of attornment, including any claim for damages of any kind whatsoever as the result of any breach by Former Landlord that occurred before the date of attornment. (The foregoing shall not limit either (a) Tenant’s right to exercise against Successor Landlord any Offset Right otherwise available to Tenant because of events occurring after the date of attornment, or (b) Successor Landlord’s obligation to correct any conditions that existed as of the date of attornment and violate Successor Landlord’s obligations as landlord under the Lease.)

4.2 Acts or Omissions of Former Landlord . Any act, omission, default, misrepresentation, or breach of warranty, of any previous landlord (including Former Landlord) or obligations accruing prior to Successor Landlord’s actual ownership of the Property.

4.3 Prepayments . Any payment of Rent that Tenant may have made to Former Landlord more than thirty (30) days before the date such Rent was first due and payable under the Lease with respect to any period after the date of attornment other than, and only to the extent that, the Lease expressly required such a prepayment.

4.4 Payment; Security Deposit . Any obligation (a) to pay Tenant any sum(s) that any Former Landlord owed to Tenant, or (b) with respect to any security deposited with Former Landlord, unless such security was actually delivered to Lender. This Section is not intended to apply to Landlord’s obligation to make any payment that constitutes a Construction-Related Obligation.

4.5 Modification; Amendment; or Waiver . Any modification or amendment of the Lease, or any waiver of any terms of the Lease, made without Lender’s written consent.

4.6 Surrender; Etc . Any consensual or negotiated surrender, cancellation, or termination of the Lease, in whole or in part, agreed upon between Landlord and Tenant, unless effected unilaterally by Tenant pursuant to the express terms of the Lease.

4.7 Construction-Related Obligations . Any Construction-Related Obligation of Landlord under the Lease.

5. Exculpation of Successor Landlord . Notwithstanding anything to the contrary in this Agreement or the Lease, upon any attornment pursuant to this Agreement the Lease shall be deemed to have been automatically amended to provide that Successor Landlord’s obligations and liability under the Lease shall never extend beyond Successor Landlord’s (or its successors’ or assigns’) interest, if any, in Landlord’s Premises from time to time, including insurance and condemnation proceeds, Successor Landlord’s interest in the Lease, and the proceeds from any sale or other disposition of Landlord’s Premises by Successor Landlord (collectively, “ Successor Landlord’s Interest ”). Tenant shall look exclusively to Successor Landlord’s Interest (or that of its successors and assigns) for payment or discharge of any obligations of Successor Landlord under the Lease as affected by this Agreement. If

Tenant obtains any money judgment against Successor Landlord with respect to the Lease or the relationship between Successor Landlord and Tenant, then Tenant shall look solely to Successor Landlord’s Interest (or that of its successors and assigns) to collect such judgment. Tenant shall not collect or attempt to collect any such judgment out of any other assets of Successor Landlord. In addition to any limitation of liability set forth in this Agreement, Lender and/or its successors and assigns shall under no circumstances be liable for any incidental, consequential, punitive, or exemplary damages.

6. Lender’s Right to Cure .

6.1 Notice to Lender . Notwithstanding anything to the contrary in the Lease or this Agreement, before exercising any Termination Right, Tenant shall provide Lender with notice of the breach or default by Landlord giving rise to same (the “ Default Notice ”) and, thereafter, the opportunity to cure such breach or default as provided for below.

6.2 Lender’s Cure Period . After Lender receives a Default Notice, Lender shall have a period of thirty (30) days beyond the time available to Landlord under the Lease in which to cure the breach or default by Landlord. Lender shall have no obligation to cure (and shall have no liability or obligation for not curing) any breach or default by Landlord, except to the extent that Lender agrees or undertakes otherwise in writing.

6.3 Extended Cure Period . In addition, as to any breach or default by Landlord the cure of which requires possession and control of Landlord’s Premises, provided only that Lender undertakes to Tenant by written notice to Tenant within thirty (30) days after receipt of the Default Notice to exercise reasonable efforts to cure or cause to be cured by a receiver such breach or default within the period permitted by this Section, Lender’s cure period shall continue for such additional time (the “ Extended Cure Period ”) as Lender may reasonably require to either (a) obtain possession and control of Landlord’s Premises and thereafter cure the breach or default with reasonable diligence and continuity, or (b) obtain the appointment of a receiver and give such receiver a reasonable period of time in which to cure the default.

7. Confirmation of Facts . Tenant represents to Lender and to any Successor Landlord, in each case as of the Effective Date:

7.1 Effectiveness of Lease . The Lease is in full force and effect, has not been modified, and constitutes the entire agreement between Landlord and Tenant relating to Tenant’s Premises. Tenant has no interest in Landlord’s Premises except pursuant to the Lease. No unfulfilled conditions exist to Tenant’s obligations under the Lease.

7.2 Rent . Tenant has not paid any Rent that is first due and payable under the Lease after the Effective Date.

7.3 No Landlord Default . To the best of Tenant’s knowledge, no breach or default by Landlord exists and no event has occurred that, with the giving of notice, the passage of time or both, would constitute such a breach or default.

7.4 No Tenant Default . Tenant is not in default under the Lease and has not received any uncured notice of any default by Tenant under the Lease.

7.5 No Termination . Tenant has not commenced any action nor sent or received any notice to terminate the Lease. Tenant has no presently exercisable Termination Right(s) or Offset Right(s).

7.6 Commencement Date . The “ Commencement Date ” of the Lease was .

7.7 Acceptance . (a) Tenant has accepted possession of Tenant’s Premises; and (b) Landlord has performed all Construction-Related Obligations related to Tenant’s initial occupancy of Tenant’s Premises and Tenant has accepted such performance by Landlord.

7.8 No Transfer . Tenant has not transferred, encumbered, mortgaged, assigned, conveyed or otherwise disposed of the Lease or any interest therein, other than sublease(s) made in compliance with the Lease.

7.9 Due Authorization . Tenant has full authority to enter into this Agreement, which has been duly authorized by all necessary actions.

7.10 No Violations of Laws . Tenant has not violated, and shall not violate, any laws affecting Tenant’s Premises, including the Controlled Substances Act, or which could otherwise result in the commencement of a judicial or nonjudicial forfeiture or seizure proceeding by a governmental authority (including the commencement of any proceedings under the Civil Asset Forfeiture Reform Act) on the grounds that Tenant’s Premises or any part thereof has been used to commit or facilitate the commission of a criminal offense by any person, including Tenant, pursuant to any law, including the Controlled Substances Act, regardless of whether or not Tenant’s Premises is or shall become subject to forfeiture or seizure in connection therewith.

8. Miscellaneous .

8.1 Notices . All notices or other communications required or permitted under this Agreement shall be in writing and given by certified mail (return receipt requested) or by nationally recognized overnight courier service that regularly maintains records of items delivered. Each party’s address is as set forth in the opening paragraph of this Agreement, subject to change by notice under this Section. Notices shall be effective the next business day after being sent by overnight courier service, and five (5) business days after being sent by certified mail (return receipt requested).

8.2 Successors and Assigns . This Agreement shall bind and benefit the parties, their successors and assigns, any Successor Landlord, and its successors and assigns. If Lender assigns the Mortgage, then upon delivery to Tenant of written notice thereof accompanied by the assignee’s written assumption of all obligations under this Agreement, all liability of the assignor shall terminate.

8.3 Entire Agreement . This Agreement constitutes the entire agreement between Lender and Tenant regarding the subordination of the Lease to the Mortgage and the rights and obligations of Tenant and Lender as to the subject matter of this Agreement.

8.4 Interaction with Lease and with Mortgage; Severability . If this Agreement conflicts with the Lease, then this Agreement shall govern as between the parties and any Successor Landlord, including upon any attornment pursuant to this Agreement. This Agreement supersedes, and constitutes full compliance with, any provisions in the Lease that provide for subordination of the Lease to, or for delivery of nondisturbance agreements by the [holder] [beneficiary] of, the Mortgage. Lender confirms that Lender has consented to Landlord’s entering into the Lease. If any provision of this Agreement is determined to be invalid, illegal or unenforceable, such provision shall be considered severed from the rest of this Agreement and the remaining provisions shall continue in full force and effect as if such provision had not been included.

8.5 Lender’s Rights and Obligations . Except as expressly provided for in this Agreement, Lender shall have no obligations to Tenant with respect to the Lease. If an attornment occurs pursuant to this Agreement, then all rights and obligations of Lender under this Agreement shall terminate, without thereby affecting in any way the rights and obligations of Successor Landlord provided for in this Agreement.

8.6 Interpretation; Governing Law . The interpretation, validity and enforcement of this Agreement shall be governed by and construed under the internal laws of the State of New Jersey, excluding its principles of conflict of laws.

8.7 Amendments . This Agreement may be amended, discharged or terminated, or any of its provisions waived, only by a written instrument executed by the party to be charged.

8.8 Execution . This Agreement may be executed in any number of counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument.

8.9 Lender’s Representation . Lender represents that Lender has full authority to enter into this Agreement, and Lender’s entry into this Agreement has been duly authorized by all necessary actions.

8.10 Reliance by Lender . Tenant acknowledges the right of Lender (as well as any Successor Landlord) to rely upon the certifications and agreements in this Agreement in making the Loan to Landlord.

IN WITNESS WHEREOF, this Agreement has been duly executed [and delivered under seal] by Lender and Tenant as of the Effective Date.


LENDER:

BANK OF AMERICA, N.A.,

a national banking association



By:

Name:

Title:


TENANT:


				,



a


By:

Name:

Title:

[ADD NOTARY ACKNOWLEDGEMENTS]

LANDLORD’S CONSENT

Landlord consents and agrees to the foregoing Agreement, which was entered into at Landlord’s request. The foregoing Agreement shall not alter, waive or diminish any of Landlord’s obligations under the Mortgage or the Lease. The above Agreement discharges any obligations of Lender under the Mortgage and related loan documents to enter into a nondisturbance agreement with Tenant. Tenant is hereby authorized to pay its rent and all other sums due under the Lease directly to Lender upon receipt of a notice as set forth in Section 3.5 above from Lender and Tenant is not obligated to inquire as to whether a default actually exists under the Mortgage. Landlord is not a party to the above Agreement.


LANDLORD:

				,



a


By:

Name:

Title:


Dated:		, 20

[ADD NOTARY ACKNOWLEDGEMENT]

GUARANTOR’S CONSENT

Each of the undersigned, a guarantor of Tenant’s obligations under the Lease (a “ Guarantor ”), consents to Tenant’s execution, delivery and performance of the foregoing Agreement. From and after any attornment pursuant to the foregoing Agreement, that certain Guaranty dated , 20 (the “ Guaranty ”) executed by Guarantor in favor of shall automatically benefit and be enforceable by Successor Landlord with respect to Tenant’s obligations under the Lease as affected by the foregoing Agreement. Successor Landlord’s rights under the Guaranty shall not be subject to any defense, offset, claim, counterclaim, reduction or abatement of any kind resulting from any act, omission or waiver by any Former Landlord for which Successor Landlord would, pursuant to the foregoing Agreement, not be liable or answerable after an attornment. The foregoing does not limit any waivers or other provisions contained in the Guaranty. Guarantor confirms that the Guaranty is in full force and effect and Guarantor presently has no offset, defense (other than any arising from actual payment or performance by Tenant. which payment or performance would bind a Successor Landlord under the foregoing Agreement), claim, counterclaim, reduction, deduction or abatement against Guarantor’s obligations under the Guaranty.


GUARANTOR:

				,



a


By:

Name:

Title:


Dated:		, 20

[ADD NOTARY ACKNOWLEDGEMENT]

SCHEDULE A

Description of Landlord’s Premises