OFFER TO LEASE
- The Landlord is the owner of commercial property for the production of cannabis that is available for lease;
- The Tenant wishes to lease premises on the property from the Landlord; and
- The Parties wish to confirm their mutual intent in writing (but on a non-binding and without-prejudice basis, except as specifically set out herein) regarding certain matters to be included in the lease prior to proceeding with more detailed negotiations.
This Offer to Lease will establish basic terms to be used in a future lease agreement (“the Lease”) between the Landlord and the Tenant. The terms contained in this Offer to Lease are not comprehensive and it is expected that additional terms may be added, and existing terms may be changed or deleted. The basic terms are as follows:
|1.||Parties:||Cannabis West Development Corp. or a wholly owned subsidiary
(each a “Party”, and collectively the “Parties”).
|2.||Property:||Cannabis grow park located in Lower Mainland, British Columbia|
|3.||Permitted Use:||Cannabis production facility and ancillary services on the Property in accordance with the terms and conditions of valid cannabis production licences and applicable laws, bylaws and authorizations (the “Facility”)|
|4.||Area of Property:||[6,300 sq. ft].|
|5.||Term:||To be negotiated in the Lease|
|6.||Basic Rent:||The Tenant shall pay to the Landlord monthly in advance without deduction in equal monthly installments on the first day of each and every month throughout the Term|
|7.||Additional Rent:||The Tenant shall pay for all other charges and expenses provided for in the Lease, including, without limitation, water/sewer rates, building insurance, maintenance, management fees, heat, light and power, plus GST applicable to the foregoing (the “Additional Rent’). The Additional Rent shall be estimated and adjusted annually by the Landlord and paid in advance with the Basic Rent on the first day of each month and every month throughout the Term|
|8.||License Fees:||The Landlord shall reimburse the Tenant for the amount paid to submit a Micro Cultivation license application. The Landlord will repay the License Application Fees to the Tenant in deductions over the first twelve months of operations, after a Micro Cultivation licence is granted by Health Canada.|
|9.||Security Deposit:||As more fully set out in the Lease, the Tenant shall deliver a cheque in the amount to be determined, be held as a security deposit against payment and proper performance of the Tenant’s obligations under the Lease. If the Tenant defaults in carrying out any of its obligations under the Lease, the Landlord, at its option, may retain the deposit as liquidated damages and not as a penalty without limiting the Landlord’s other remedies at law or in equity.|
|10.||Landlord’s Improvements:||The Facility is to be provided by the Landlord on an “as is, where is” basis, except for the Landlord shall construct a suitable facility for the purposes of permitted use pursuant to section 3|
|11.||Tenant’s Improvements:||All Tenant’s improvements shall be done at the Tenant’s sole cost and expense by qualified and licensed contractors and subcontractors who shall be subject to the reasonable approval of the Landlord. All such Tenant’s improvements shall be performed in accordance with the provisions of the Lease. The Tenant shall be responsible for all permits for the Tenant’s improvements|
|12.||Registration:||The Lease shall be in a registrable form|
|13.||Utilities:||The Landlord or a designated entity shall provide the Tenant with access to water, natural gas, sewer, data and electrical services necessary for the Tenant to develop and operate the Facility.
The Tenant shall be responsible for paying for all utilities required to carry out its operations in a safe manner and in accordance with the Lease
|14.||Property Management Fees:||The Tenant shall be responsible for paying all services required to operate the Facility in a safe manner and in accordance with the Lease including, but limited to, park lighting, security, perimeter fencing, snow removal and park maintenance|
|15.||Lease:||The Landlord shall prepare and deliver the first draft of the Lease within 120 days of the execution of this Offer to Lease
The Parties shall work diligently to negotiate and execute the Lease within 150 days of the execution of this Offer to Lease
|17.||Landlord’s Conditions||Credit check of the Tenant to the satisfaction of the Landlord, receipt of security deposit from the Tenant and Lease approval and registration|
|18.||Expenses:||Each Party shall pay its own legal fees in connection with the transactions contemplated hereunder.|
|19.||Confidentiality:||This Offer to Lease is confidential and disclosure of its existence or terms shall be limited to the Parties and their respective representatives who need to be made aware of such existence or terms in order to consummate the transactions contemplated herein|
|20.||General Provisions:||The Lease will contain provisions regarding signage, indemnities, insurance, notice, severability, amendments, waiver, restrictions on assignment, confidentiality, representations of the Parties, and such other general provisions as may be agreed to by the Parties|
|21.||Assignment:||The Tenant shall not assign all or any of its rights or obligations under this Offer to Lease, except with the prior written consent of the Landlord.|
|22.||Binding Provisions:||This Offer to Lease is intended by the Parties to be an expression of interest only and, with the exception of sections 18 and 21 is not intended to represent legally binding commitments or obligations on either Party
Except for section 18, no Party will have any obligation or liability with respect to this Offer to Lease to any other party for any reason until, and in accordance with, the execution of the Lease by the Parties
IN WITNESS WHEREOF this Offer to Lease has been duly executed by the Parties as of the date received stamp, listed below.