Commercial Lease Agreement - Triple-Net

Quebec English Civil law Unannotated

Commercial Lease Agreement - Triple-Net

Many companies rent rather than purchase the premises in which they carry on their activities. Doing so gives a business greater flexibility to expand their operations and requires less of a financial commitment than if they owned the premises. Moreover, from a legal perspective, renting a building is less complicated than purchasing one.

Our template presents the main legal, economic and physical elements of a general commercial lease under which the landlord undertakes to ensure the tenant’s quiet enjoyment of the rented premises during a fixed period of time in exchange for rent.

It should be noted that to avoid any confusion between the terms "lessor" and "lessee," we have used the terms "landlord" and "tenant" in this template.

Commercial Lease Agreement - Triple-Net

This document was designed as a versatile template for a commercial lease. It can be used for almost any context involving the renting of commercial space, except for large complexes, such as shopping malls (see our template: Percentage Lease, E03200).

The provisions contained in this template are not drafted for a specific commercial context, so it is important to review each clause to assess its relevance and make the necessary adaptations. It should be noted that in this template, the lessee undertakes to pay rent as well as a share of the operating costs.

Commercial Lease Agreement - Triple-Net

0.00 INTERPRETATION
0.01 Definitions
0.01.01 Activities
0.01.02 Breach
0.01.03 Building
0.01.04 Claim
0.01.05 Common Areas
0.01.06 Confidential Information
0.01.07 Dispute
0.01.08 Encumber / Encumbrance
0.01.09 Force Majeure
0.01.10 Hazardous Materials
0.01.11 Immovable
0.01.12 Land
0.01.13 Law
0.01.14 Lease
0.01.15 Leased Premises
0.01.16 Leasehold Improvements
0.01.17 Legal Representatives
0.01.18 Loss
0.01.19 Operating Costs
0.01.20 PARTY
0.01.21 Person
0.01.22 Prime Rate
0.01.23 Property
0.01.24 Property Taxes
0.01.25 Proportionate Share
0.01.26 Rent
0.01.27 Total Rentable Space
0.02 Entire Agreement
0.03 Applicable Law
0.04 Non-Compliance
0.04.01 Severability
0.04.02 Substitute Provision
0.05 Miscellaneous
0.05.01 Cumulative Rights
0.05.02 No Waiver
0.05.03 Time and Days
a) Time of the Essence
b) Computation of Time
c) Delays
0.05.04 Financial References
0.05.05 Cross-References
0.05.06 Gender and Number
0.05.07 Headings
0.05.08 Knowledge
0.05.09 Approval
0.05.10 Accounting Standards
1.00 PURPOSE
1.01 Lease
1.02 Taking of Possession
1.03 Conditions
1.03.01 Required by LANDLORD
1.03.02 Required by TENANT
1.03.03 Election
2.00 CONSIDERATION
2.01 Base Rent
2.01.01 Monthly
2.01.02 Renewal
2.02 Additional Rent
2.02.01 Proportionate Share
2.02.02 Occupancy Rate
a) Increase
b) Limit
2.03 Estimated Value
3.00 TERMS OF PAYMENT
3.01 Base Rent
3.01.01 General
3.01.02 Deposit
3.02 Additional Rent
3.02.01 First Year
3.02.02 Revised Estimates
3.02.03 Subsequent Years
3.03 Adjustment
3.03.01 Report
a) Issued Annually
b) Payment or Reimbursement
3.03.02 Contesting
a) Notice of Objection
b) Access
c) Negotiation
d) Independent Auditor
3.04 Place of Payment
3.05 Interest
3.06 Waiver of Compensation
3.06.01 By TENANT
3.06.02 By LANDLORD
3.07 Loss of Term
4.00 SECURITY
4.01 Movable Hypothec With Delivery [OR Without Delivery]
4.02 Suretyship
4.03 Letter of Credit
4.04 Security Deposit
4.04.01 Paid to LANDLORD
4.04.02 Returned to TENANT
5.00 MUTUAL REPRESENTATIONS AND WARRANTIES
5.01 Status
5.02 Authority
5.03 Binding Agreement
5.04 Canadian Resident
5.05 Commission
5.06 Insurance
5.07 Nominee
5.08 Independent Advice
5.09 Disclosure
5.10 Legal Proceedings
5.11 Repairs to Leased Premises
6.00 REPRESENTATIONS AND WARRANTIES OF LANDLORD
6.01 Sole Ownership
6.02 Good Title
6.03 Right to Lease
6.04 Construction
6.05 Permits
6.06 Legal Activities
6.07 Latent Defects
6.08 Additional Rent
6.08.01 Annual Estimate
6.08.02 Previous Years
6.08.03 Previous Increases
6.08.04 Objections
6.09 Condition of Leased Premises
6.10 Bankruptcy
6.11 Occupancy Rate
6.12 Environment
6.12.01 Environmental Laws
a) Compliant Activities
b) Compliant Place of Operations
6.12.02 Contravention
6.12.03 Hazardous Materials
7.00 REPRESENTATIONS AND WARRANTIES OF TENANT
7.01 Condition of Leased Premises
8.00 MUTUAL DUTIES AND OBLIGATIONS
8.01 Confidential Information
8.01.01 Undertaking
8.01.02 Duration of Undertaking
8.01.03 End of Lease
a) Request for Return
b) Destruction
8.01.04 Penalty
8.02 Continuation of Representations and Warranties
8.03 Indemnification
8.03.01 Scope
8.03.02 Procedure
8.03.03 Third-Party Claim
8.03.04 Duration of Representations and Warranties
8.03.05 Deductible
8.03.06 Limitation
8.04 Disclosure of Lease
8.04.01 Undertaking
8.04.02 Public Announcement
8.04.03 Exception
8.04.04 Default
8.05 Periodic Meetings
8.06 Further Assurances
8.07 Limitation on Liability
9.00 DUTIES AND OBLIGATIONS OF LANDLORD
9.01 Required Work
9.02 Condition of Leased Premises
9.02.01 Upon Delivery
9.02.02 Maintenance and Repair
9.03 Condition of Immovable
9.03.01 Work
9.03.02 Minimal Disruption
9.04 Eviction
9.05 Quiet Enjoyment of Premises
9.05.01 Co-Tenant
9.05.02 Third Parties
9.05.03 Defence
9.05.04 Indemnification
9.05.05 Penalty
9.06 Limitation on Liability
9.07 Safety
9.08 Guarantee by Hypothecary Creditor
9.09 Insurance Policies
9.09.01 Coverage
9.09.02 Certificates
9.10 Services
9.11 Exclusivity
9.12 Right of First Refusal
9.12.01 Leased Premises
a) Notice
b) Undertaking
9.12.02 Guarantee
9.12.03 Procedure
9.12.04 Reply
9.12.05 Disclosure
9.12.06 Closing Session
9.13 Sale of Immovable
9.14 Option to Purchase
9.14.01 Undertaking
9.14.02 Procedure
9.14.03 Closing
9.15 Personal Information
10.00 DUTIES AND OBLIGATIONS OF TENANT
10.01 Non-Solicitation of Personnel
10.01.01 Scope of Undertaking
10.01.02 Breach of Undertaking
a) Automatic Penalty
b) Payment
c) Protective Measures
10.02 Non-Solicitation of Clients
10.02.01 Scope of Undertaking
10.02.02 Breach of Undertaking
a) Automatic Penalty
b) Payment
c) Protective Measures
10.03 Acknowledgement
10.04 Acceptance of Leased Premises
10.04.01 Notice
10.04.02 Assumption
10.05 Electricity Costs
10.06 Activities
10.07 Insurance
10.07.01 Acknowledgement
10.07.02 Insured Risks
10.07.03 Conditions
10.07.04 Increased Risks
10.07.05 Hazardous Materials
10.07.06 Copies of Insurance Policies
a) Undertaking
b) Breach
10.08 Use of Leased Premises
10.08.01 Permitted Activities
10.08.02 Duty of Care
10.09 Continuous Occupancy
10.10 Regular Business Hours
10.11 Taxes
10.12 Heating, Ventilation and Air Conditioning
10.12.01 Maintaining HVAC System
10.12.02 Maintaining Adequate Temperature
10.13 Minor Maintenance Repairs
10.14 Major Repairs
10.15 Fire Prevention
10.16 Environment
10.17 Permits
10.18 Compliance
10.19 Alterations, Additions and Improvements
10.19.01 Prior Consent Required
10.19.02 Supervision
10.19.03 Incurred Expenses
10.19.04 Insurance
10.19.05 Removal
10.20 Encumbrances
10.21 Legal Hypothec
10.22 Right to Visit Premises
10.23 Limitation on Liability
10.23.01 TENANT's Property
a) Limitation
b) Maintenance
10.23.02 Utility Services Interruptions
10.24 Deterioration
10.25 Abandonment
10.26 Excess Load
10.26.01 Prohibition
10.26.02 Repairs
10.27 End of Lease
10.27.01 Delivery of Leased Premises
10.27.02 Leasehold Improvements
10.28 Alternative Execution
10.29 Certificate of Occupancy
10.29.01 Undertaking
10.29.02 Modifications
10.30 Fees for Preparing Lease
10.31 Fitting the Premises (if V1 in Section 4.01 applies)
10.32 Personal Information
10.32.01 LANDLORD's Right
10.32.02 Authorization to LANDLORD
10.32.03 Authorization to Third Parties
10.32.04 Limitation
11.00 SPECIAL PROVISIONS
11.01 Assignment
11.01.01 Prior Consent
a) Definition
b) Default
11.01.02 Notice of Transfer
a) Prohibition
b) Information
c) Reply
11.01.03 Reasonable Cause
11.01.04 Limitation on Liability
11.01.05 Termination
11.01.06 Procedure
a) Payment
b) Documents
c) Signature
d) No Release or Discharge
e) Closing Session
11.01.07 Rent
a) Collection by LANDLORD
b) Remittance to LANDLORD
c) Advance Payment
11.01.08 Bankruptcy of Assignee
11.02 Hypothec and Assignment
11.02.01 Sale or Financing
11.02.02 Subordination
11.02.03 Declaration by TENANT
11.02.04 Execution of Deeds or Certificates
11.02.05 Assignment by LANDLORD
11.03 Publication
11.03.01 Right to Publish
11.03.02 Undertaking
11.04 Force Majeure
11.04.01 Limitation on Liability
11.04.02 Duty
11.04.03 Right of Other PARTY
11.05 Relationship Between the PARTIES
11.06 Remedies
11.06.01 Choice
11.06.02 No Limitations
11.07 Pre-Incorporation Agreement
12.00 GENERAL PROVISIONS
12.01 Notice
12.02 Dispute Resolution
12.02.01 Good Faith Negotiations
a) Written Notice
b) Meeting
c) Legal Proceedings
d) Protective Measures
12.02.02 Mediation
a) Process
b) Settlement
c) Arbitration [OR Legal Proceeding]
12.02.03 Arbitration Procedure (if V1 of 12.02.02 c) applies)
a) Notice
b) Reply
c) Appointment of a Third Arbitrator
d) Subcontracts
e) Confidentiality
f) Hearing
g) Ruling
h) Costs
i) Supplementary Rules
12.03 Choice of Forum
12.04 Counterparts
12.05 Amendment
12.06 No Waiver of Rights
12.07 Electronic Transmission
12.08 Language
13.00 TERMINATION
13.01 Expiry of Term
13.02 Termination
13.02.01 Without Notice
13.02.02 With Notice
13.03 Destruction of Leased Premises
13.03.01 Partial Destruction
a) Undertaking
b) Reduction of Base Rent
c) Termination of Lease
13.03.02 Substantial Destruction
a) Undertaking
b) Reconstruction
14.00 EFFECTIVE DATE
15.00 DURATION
15.01 Initial Term
15.02 Renewal
15.02.01 Procedure
15.02.02 Expiry of Lease
15.02.03 Land Transfer Tax
15.03 Tacit Renewal
16.00 SCOPE

SCHEDULE A – EXCERPT OF A RESOLUTION OF LANDLORD
SCHEDULE B – EXCERPT OF A RESOLUTION OF TENANT
SCHEDULE 0.01.15 – LEASED PREMISES
SCHEDULE 4.01 – MOVABLE HYPOTHEC WITH[OUT] DELIVERY
SCHEDULE 4.02 – SURETYSHIP
SCHEDULE 4.03 – LETTER OF CREDIT
SCHEDULE 6.01 – TITLE SEARCH
SCHEDULE 6.02 – ENCUMBRANCES
SCHEDULE 9.01 – COMPLEMENTARY WORK BY LANDLORD
SCHEDULE 10.02.01 A – NON-SOLICITATION - CLIENTS
SCHEDULE 10.02.01 B – NON-SOLICITATION – PRODUCTS AND SERVICES
SCHEDULE 10.13 – MAINTENANCE
SCHEDULE 11.02.03 – DECLARATION BY TENANT
SCHEDULE 11.03 – PUBLICATION