Partnership Agreement for Ownership of Land

PARTNERSHIP AGREEMENT FOR OWNERSHIP OF LAND

DATED ,

PARTNERSHIP AGREEMENT made as of

B E T W E E N

(herein called the "Vendor")

- and -

(herein called the “Developer")

A. The Vendor owns the lands and premises described in Schedule A and shown in Schedule B.

B. The Vendor has agreed to transfer the said lands and premises to the Partnership created by the parties to this agreement for the limited purposes and upon the terms and conditions provided for in this agreement.

C. Each of the parties is a corporation whose principal business is the leasing, rental or sale or development for lease, rental or sale or any combination thereof of real property owned by it as defined in paragraph 18(3.4)(a) of the Income Tax Act (Canada), R.S.C. 1985, c. 1 (5th Supp).

In consideration of the premises and the mutual covenants and agreements contained in this agreement the parties to this agreement covenant and agree each with the other as follows:

ARTICLE I

DEFINITIONS 2

MEANING OF CERTAIN TERMS

1. (1) In this agreement

“Affiliate” of a Partner means a company that is:

(a) a subsidiary or a parent of the Partner;

(b) a subsidiary of the parent of the Partner; or (c) a parent of the parent of the Partner.

Alternate: “Affiliate” means a corporation of which a party to this Agreement is a subsidiary or which is a subsidiary of such corporation or of such party.

A "subsidiary" of a company means a company, all of the voting shares of which are owned by the company of which it is a subsidiary. A "parent" of a company means a company that owns all of the voting shares of the company of which it is the parent.

“Complex” means the commercial [office building] [shopping centre] [ ] to be constructed on that portion of the Property indicated on Schedule B.

“Executive Committee” means a committee comprised of 4 persons, 3 of whom shall be designated by the Vendor and 1 of whom shall be designated by the Developer.

Alternate: “Executive Committee” means a committee of 2 persons, 1 of whom shall be appointed by each of the Partners.

“Fair market value” of any asset means that amount, subject to the usual adjustments applicable in the case of a transfer of such asset, which is equal to

(a) the amount which the parties have agreed upon; or

if they are unable to agree within 90 days after the event occasioning the need for such determination

(b) the appraised value determined as follows:

1. Within 30 days after being requested to do so each of the Vendor and the Developer may appoint a person who shall be an independent recognized appraiser of similar lands regularly carrying on business as such in Southern Ontario. If such persons are unable to agree upon the fair market value of such lands, they shall appoint an additional person, qualified as aforesaid. Each of such persons so appointed shall appraise the fair market value of such lands. If only one person is so appointed and delivers an appraisal, or if the 3

appraisal of a majority of such persons is identical in amount, the amount of such appraisal shall be deemed to be the fair market value of such lands. Otherwise, the fair market value of such lands shall be determined as follows:

(i) any appraised value which differs from the middle appraised value by more than 10% of the middle appraised value shall be excluded and the fair market value of such lands shall be deemed to be the average of the remaining appraised values,

(ii) if all appraised values differ from the middle appraised value by more than 10% of the middle appraised value, then the fair market value of such lands shall be deemed to be the middle appraised value, and

(iii) if only 2 appraisals are delivered then the fair market value of such lands shall be deemed to be the average of those appraisals.

2. Each of the Partners shall pay the fees and expenses of the appraiser appointed by it, and an equal share of the fees and expenses of any additional appraiser.

“Initial Period” means the period ended on that date on which

(a) the zoning for the Lands shall have been completed to permit the development thereof; and

(b) all infrastructure services required to permit such development have been constructed to a boundary of each such portion.

“Lands” means the lands described in Schedule A and all the right, title and interest of each of the Partners in lands, if any, abutting the lands described in Schedule A together with all buildings and improvements comprised therein.

“Management Agreement” means the agreement dated as of the date hereof between the Partnership and the Developer to provide for the management of the Property.

“Mortgage” includes a pledge, charge, hypothec, encumbrance and financing arrangement.

“Net Cash Flow” for any period with respect to which a distribution is being made means the net amount of money remaining, if any, after net income or loss of the Partnership, as determined for the Partnership for the purposes of the Income Tax Act and, to the extent not inconsistent therewith, in accordance with generally accepted accounting principles, adjusted as follows:

(a) there shall be added to such net income or loss

(i) the amount charged for any deduction not involving a cash expenditure, 4

(ii) any cash received to the extent not included in net income, including but not limited to proceeds received by reason of sales, expropriations or condemnations and destruction of the whole or any part of the Property,

(iii) loans to the Partnership, and

(iv) cash contributions to the Partnership; and

(b) there shall be subtracted from such net income or loss

(i) the amount of payments made on account of principal upon mortgages against the Property and upon loans made to the Partnership, except by any Partner,

(ii) any amounts paid for non-deductible capital expenditures,

(iii) any other cash sums expended for otherwise non-deductible items,

(iv) distributions, if any, made to the Partners during such period, and

(v) a cash reserve in an amount deemed necessary by the Executive Committee in order to retain sufficient working capital in the Partnership or for any purpose required by the Executive Committee.

“Partners” means the Vendor and the Developer and either of them when the reference is singular, and their respective successors in interest.

“Partnership” means the partnership created by this agreement.

“Percentage Interest” of any Partner means such Partner's percentage interest in the Partnership as specified in section 2(4) as amended from time to time in accordance with this agreement, and excludes all indebtedness of the Partnership to such Partner.

“Prime Rate” means that rate of interest compounded semi-annually which is equal to

(a) the prime rate charged by Royal Bank of Canada for commercial demand loans in Canadian funds to its most favoured commercial customers from time to time as such interest accrues; plus

(b) 1%.

Property includes the Lands and all other property, assets and rights both real and personal appurtenant thereto or held by either of the Partners for use in connection therewith including: 5

(a) all leases and other agreements relating to the occupation of any portion of such lands, together with the rentals and other benefits thereunder;

(b) the benefit of all agreements including licences and employment contracts relating to the operation or maintenance of such lands and the equipment thereon;

(i) the name of the Partnership and of any business carried on by it or by which the Property or any part thereof is identified, and

(ii) all its rights, title and interest, if any, in and to any and all outstanding licences (including elevator licences), permits, guarantees, warranties and indemnities in favour of the Partnership; and

(iii) all telephone numbers issued with respect thereto; and

(d) all issued and outstanding shares of any corporation referred to in section 2(16).

“Complex” means the retail commercial Complex to be constructed on that portion of the Property indicated on Schedule B.

ARTICLE II

CONSTITUTION OF PARTNERSHIP

FORMATION

2. (1) The Vendor and the Developer hereby form a partnership for the following purposes

(a) to hold the Property;

(b) to obtain zoning for the Lands to permit the commercial and residential development thereof as shown on Schedule B;

(d) to construct all infrastructure services required to permit the development of the Lands; (e) to construct, own, operate, and derive rental income from the Complex;

(f) to develop the remainder of the Lands for sale, up to but not including construction; and 6

(g) to manage the Property and engage in such other operations and businesses with respect to the Property or otherwise as may be deemed necessary or appropriate to the foregoing purposes.

Each of the Partners shall use its continuing best efforts to promote the purposes of the Partnership.

NAME

2. (2) The name of the Partnership shall be

TERM

2. (3) The Partnership shall commence on the date of this agreement and continue until terminated pursuant to Article X.

INTERESTS 2. (4) The interests of the Partners in the assets, liabilities, profits and losses of the Partnership shall be as follows:

The Vendor - % The Developer - %

PRINCIPAL OFFICE

2. (5) The principal office of the Partnership shall be at such place as the Executive Committee may from time to time determine; provided that, so long as the Developer continues to hold at least a 50% Partnership Interest and manages the Complex pursuant to a Management Agreement with the Partnership, the principal office of the Partnership shall be at such place in the Municipality of Metropolitan Toronto as the Executive Committee may from time to time determine.

GOVERNING LEGISLATION

2. (6) Except as is expressly stipulated in this agreement to the contrary, the rights and obligations of the Partners and the administration and termination of the Partnership shall be governed by the Partnerships Act, R.S.O. 1990, c. P.5, or any successor legislation or other statute which may be passed to take the place of the said Act or to amend the same. 7

OWNERSHIP

2. (7) The interest of each Partner in the Partnership shall be personal and moveable property for all purposes. All real, immoveable and other property owned by the Partnership shall be deemed owned by the Partnership as a partnership and no Partner, individually, shall have any ownership of such real, immoveable and other property.

NO INDIVIDUAL AUTHORITY

2. (8) Except as otherwise expressly provided in this agreement, no Partner, acting alone, shall have any authority to act for, or to assume any obligation or responsibility on behalf of the other Partners or the Partnership.

NO RESTRICTIONS

2. (9) Subject to section 2(15), nothing contained in this agreement shall prohibit a Partner or any Affiliate of a Partner or their respective officers, directors and shareholders from owning, operating or investing in any real estate development not owned or operated by the Partnership wherever located. Each Partner agrees that any Partner or any Affiliate of a Partner or their respective officers, directors and shareholders may engage in or possess an interest in any venture of any nature and description, independently or with others, including but not limited to the ownership, financing, leasing, operating, management, syndication, brokerage and development of real or immoveable property, and neither the Partners nor the Partnership shall have any rights by virtue of this agreement in and to such venture or to the income or profits derived therefrom.

NO PARTNER RESPONSIBLE FOR OTHER'S COMMITMENTS

2. (10) No Partner shall be responsible or liable for any indebtedness or obligation of another Partner incurred either before or after the execution of this agreement, except for any indebtedness or obligation incurred by the Partnership pursuant to the terms of this agreement and then only to the extent provided in this agreement, and each Partner shall indemnify and hold the other Partner harmless from every such indebtedness and obligation except as aforesaid. Without limiting the generality of the foregoing, the Partnership shall have no obligation to pay for any costs in any way relating to the Property incurred prior to the transfer of the Property to the Partnership.

INDEMNITY BY PARTNERS

2. (11) Each of the Partners shall indemnify and save the other Partner harmless from any and all 8 liabilities, payments, damages, costs (including legal fees), fines, penalties, claims, suits and actions resulting from or arising with respect to

(a) any breach, violation or non-performance by it of any of its covenants, obligations or agreements under this agreement; and

(b) any contract, lien, privilege, mortgage, charge or encumbrance of the Property arising from or occasioned by its act, default or negligence or that of its officers, agents, servants, employees, contractors, customers, invitees or licencees, and such indemnification shall survive the termination of this agreement, anything in this agreement to the contrary notwithstanding.

REPRESENTATIONS

2. (12) Each of the Partners represents and warrants that the execution and delivery by it of this Agreement has been duly authorized by all necessary action of its directors and shareholders and that the consummation of the transactions provided for in this Agreement will not result in a breach or violation of, or a default under, its charter or by-laws, any agreement by which it is bound or any statute, regulation, order or other law to which it is subject.

PERFORMANCE OF COVENANTS

2. (13) If a Partner shall be in default of any of its covenants, obligations or agreements under this agreement and such default shall have continued for such period as may be reasonably required in the circumstances to cure such default, after notice to it from the other Partner specifying with reasonable particularity the nature of such default and requiring the same to be remedied, the other Partner, without prejudice to any other rights which it may have with respect to such default, may remedy such default and the cost thereof to the other Partner shall be deemed to be an advance to the Partnership by such other Partner and shall be repaid to such other Partner in accordance with section 5(4).

TIME DEVOTED TO PARTNERSHIP

2. (13) No Partner shall be required, in such capacity, to devote any particular amount of time or attention to the affairs of the Partnership.

REPRESENTATIONS

2. (14) Each of the Partners represents and warrants that the execution and delivery by it of this agreement has been duly authorized by all necessary action of its directors and shareholders 9 and that the consummation of the transactions provided for in this agreement shall not result in a breach or violation of, or a default under, its charter or by-laws, any agreement by which it is bound or any statute, regulation, order or other law to which it is subject.

CORPORATE TRUSTEE

2. (15) The whole of the issued and outstanding shares of any corporation in whose name title to any part of the Lands is registered shall be registered in the names of the Partners in the same proportions as their respective Percentage Interests and shall be held by them in trust for the Partnership as part of the Property in accordance with this agreement. No shareholder of the Corporation shall vote any shares of the Corporation nor consent to or otherwise cause or permit the Corporation to, and the Corporation shall not, without the unanimous consent of 100% in interest of the Partners

(a) amend or vary in any way any provision of its Articles of Incorporation or by-laws;

(b) allot, issue, sell, exchange or otherwise dispose of any of its shares or option or agree to allot, issue, or option for sale, exchange or other disposition any of its shares;

(c) increase or decrease the number of its directors or have any directors other than a single nominee of each of the Vendor and the Developer;

(d) have any officers other than

President - a nominee of the Developer Secretary-Treasurer - a nominee of the Vendor;

(e) borrow money;

(f) directly or indirectly acquire any interest in or be engaged in or make any investment in any business or undertaking except as provided for in this agreement;

(g) enter into any agreement, except in accordance with policies established from time to time by the Executive Committee;

(h) repay in whole or in part any indebtedness due to any of its shareholders except in accordance with this agreement;

(i) have any subsidiary;

(j) have any auditors or accountants other than the auditors or accountants from time to time of the Partnership; or 10

(k) commence any proceedings to wind up, dissolve or liquidate the Corporation or make any assignment for the benefit of its creditors or any application for a receiving order against it.

Each of the Partners agrees that as a shareholder it shall vote or cause all shares of the Corporation held by it to be voted, and shall cause the Corporation and its directors to implement all provisions of this agreement.

COMPLIANCE OF PROPERTY

2. (16) The Vendor represents and warrants to the Developer and, to the intent that this section shall survive the closing of this transaction, covenants with the Developer that, as at the date of this agreement, the Property and the use thereof by The Vendor complies in all respects with every applicable statute, by-law, regulation, covenant and restriction, including, without limitation, those related to health and safety, waste disposal and environmental protection.

NO KNOWLEDGE

2. (17) The Vendor represents and warrants to the Developer and covenants with the Developer that, except for it is aware of no material fact or circumstance which could have any material adverse effect on the Property or the development thereof as contemplated by this agreement.

ARTICLE III

CAPITAL AND ALLOCATION OF PROFITS AND LOSSES

CAPITAL OF THE PARTNERSHIP

3. (1) The capital of the Partnership shall be the interest of the Partnership in the Property as represented by the net contributions made by the Partners pursuant to section 3(2).

CONTRIBUTION BY PARTNERS

3. (2) The Vendor shall transfer the Property to the Partnership pursuant to section 4(1). The Partners have agreed that the fair market value of the Property free and clear of encumbrances is $ . Upon the execution and delivery hereof The Developer has made a contribution of $ to the Partnership. Upon the transfer of the Property to the Partnership, the Developer shall assume all liability under the mortgage referred to in section 4(1) and shall make a further contribution to the Partnership equal to the difference between the amount outstanding as at the date hereof for principal and interest on such mortgage and $ and the Partnership shall 11 distribute to the Vendor such amount as is required so that the net contributions of the Partners to the Partnership shall then be:

The Vendor $ The Developer $ .

NO INTEREST PAYABLE

3. (3) No Partner shall receive any interest on its contribution to the capital of the Partnership.

NET PROFITS AND LOSSES

3. (4) Net profits and losses of the Partnership shall be determined in accordance with generally accepted accounting principles. The annual net profits of the Partnership shall be allocated to the Partners in the same proportions as their respective Percentage Interests during such year and the losses if any, of the Partnership shall also be borne by the Partners in such proportions.

TAX ROLLOVER TREATMENT

3. (5) Notwithstanding section 3(4), where a Partner has contributed or transferred property (including depreciable, non-depreciable and eligible capital property) to the Partnership and an election has been made under subsection 97(2) of the Income Tax Act with respect to such contribution or transfer, the cost of the property, for purposes of Partnership accounting, shall be the aggregate of

(a) the fair market value of any consideration received by the Partner, other than by way of a credit to such Partner's capital account; and

(b) the amount credited to such Partner's capital account with respect to the transfer or contribution of such property.

The profit, income, gain, or loss on an actual or deemed disposition of such property shall be determined for Partnership accounting purposes by comparing the proceeds of disposition of such property with the cost as determined above, and shall be allocated to the Partners in the same proportions as apply in the case of other amounts of income gain or loss. The amount by which the cost of the property for accounting purposes exceeds the amount elected for tax purposes under subsection 97(2) of the Income Tax Act shall be treated as part of the income (including recaptured capital cost allowance), gain (including taxable capital gain), or loss (including allowable capital loss and terminal loss) for Federal and Provincial income tax purposes of the Partner by whom the contribution or transfer was made. Any remaining amount shall be allocated in accordance with section 3(4). 12

ARTICLE IV

ACQUISITION OF THE PROPERTY

TRANSFER TO PARTNERSHIP

4. (1) On or before the expiry of months after the date of this Agreement the Vendor shall transfer the Property to the Partnership and shall deliver vacant possession of the Property to the Partnership and convey to the Partnership (subject to payment by the Partnership of applicable registration fees and land transfer tax) a good and marketable title to the Property free and clear of any lien, charge, encumbrance or adverse claim other than

(a) the reservations, limitations, provisos and conditions expressed in the original grant thereof from the Crown;

(b) the leases referred to in section 4(2)(a);

(d) taxes and local improvement rates for the year in which the Property is conveyed pursuant to this Agreement and subsequent years; and

(e) registered agreements, covenants and restrictions, by-laws, regulations and statutes; none of which shall interfere with or restrict the rights of the Partnership or its successors or assigns to proceed with the development of the Property in a manner satisfactory to the Partnership.

CONDITIONS

4. (2) The obligation of the Partnership to acquire the Property is subject to the following conditions:

(a) the existing leases of premises comprised in the Property in favour of shall be satisfactory to the Developer;

(b) the Partnership shall have obtained soil tests indicating in its sole opinion that the Property is satisfactory for the purposes of the Partnership;

audits indicating in its sole opinion that the Property is satisfactory for the purposes of the Partnership;

(d) all necessary municipal by-laws shall have been enacted and all approvals, consents and authorizations shall have been given, on terms acceptable to the Partnership, by all municipal and other governmental and regulatory authorities having jurisdiction with respect thereto to permit the Partnership to proceed with the development of the Property in a manner satisfactory to the Partnership, by

(i) the construction of , and

(ii) the construction of ;

(e) the Partnership shall have entered into arrangements satisfactory to it for the construction of such development on the Property and for the leasing thereof;

(f) a building permit or building permits shall have been issued which will permit the Partnership to complete the construction of such development in accordance with its plans and specifications;

(g) the Partnership shall have arranged for long term financing of such development; and

(h) there shall be no material claim, judgment, decree, order, action, suit, or proceeding in existence, pending or threatened against or directly affecting the Property, or which would prevent or hinder the sale of the Property to the Partnership or which would prevent or hinder the construction or use of such development in the manner contemplated by this Agreement.

FULFILMENT OF CONDITIONS

4. (3) The Developer, on behalf of the Partnership, shall forthwith apply for and shall diligently proceed with every application and shall use its continuing best efforts to obtain all approvals, consents and authorizations necessary to fulfil each of the conditions set out in section 4(2). The Vendor shall cooperate with the Developer to fulfil each of such conditions and shall take all such action and execute all such documents which shall be reasonably required by the Developer where applicable to fulfil such conditions. If prior to the transfer of the Property to the Partnership any of the conditions set out in section 4(2) is not fulfilled to the satisfaction of the Developer, and is not waived by the Developer, this Agreement shall terminate.

VALUE OF PROPERTY 14

4. (4) It is agreed that for the purpose of the Partnership the interest of the Vendor in the Property when it is acquired by the Partnership shall be deemed to have a value of $ being the total of the following agreed values

-land described in Schedules "A" and "B" $

-building and improvements constructed on the land described in Schedule "A" $

Total $ and the difference between such amount and the amount of the principal and interest then secured by the mortgage referred to in section 4(1)(c) shall be credited to the Vendor as an advance to the Partnership by the Vendor repayable in accordance with section 5(3).

TAX BASES

4. (5) Notwithstanding section 4(4), the Partners shall jointly elect in prescribed form and within the time referred to in subsection 96(4) of the Income Tax Act, that the amounts which they have agreed upon as the proceeds to the Vendor of the disposition of the interest of the Vendor in the Property and the amounts for which the Partnership acquired the interest of the Vendor in the Property shall be as follows

-land described in Schedules "A" and "B" $

-building and improvements constructed on the land described in Schedule "A" $

Total $

ASSUMPTION OF MORTGAGE 4. (6) At the time the Property is acquired by the Partnership the Developer shall be deemed to have assumed the mortgage referred to in section 4(1)(c) and shall thereafter

(a) be bound by and observe the provisions of such mortgage in the same manner and to the same extent as if originally named as the mortgagor therein; and (b) indemnify and save the Vendor and the Partnership harmless from the payment of any moneys thereunder.

The Developer shall obtain the discharge of such mortgage if required to effect any mortgage 15 referred to in section 5(2).

ARTICLE V

FINANCING

NO OBLIGATION

5. (1) Except to the extent provided for in this agreement no Partner shall be obligated to lend money to, invest in or otherwise contribute financially to the Partnership.

DEVELOPMENT MORTGAGE

5. (2) The Developer shall loan or arrange for the loan to the Partnership of the all moneys required to finance the costs and expenses of planning and zoning the Lands and of the construction to a boundary of each portion of the Lands of all infrastructure services required to permit the development of such portion. Such loan shall be secured by a development mortgage (subordinate only to the matters referred to in sections 4(1)(a) to (d)) in form satisfactory to the Developer and the Executive Committee.

LOANS AND GUARANTEES BY PARTNERS

5 (3) All amounts in addition to those provided for in section 5(2) required for the purposes of the Partnership shall be obtained, to the maximum extent possible, by way of interim or permanent mortgage financing by third parties of the property and assets of the Partnership. All liabilities incurred by the Partnership shall be on a non-recourse basis so that neither of the Partners is liable to personally guarantee any debts or liabilities of the Partnership except to the extent of their respective Percentage Interests. All additional amounts required by the Executive Committee for the Partnership shall be advanced to the Partnership by way of unsecured loans from the Partners. Such advances shall be made by the Partners in the same proportions as their respective Percentage Interests. No Partner shall be required to provide its guarantee of any such financing unless all Partners agree to be severally (but not jointly) responsible for such guarantee in the same proportions as their respective Percentage Interests.

REPAYMENT OF LOANS BY PARTNERS

5. (4) The amount of any advance by a Partner by way of loan to the Partnership shall not increase the capital contribution of such Partner or, except as provided in this section 5(4), entitle it to any increase in its share of the distributions of the Partnership pursuant to Article VIII. The amount of any such advance shall be an obligation of the Partnership to such Partner. All such 16 unsecured advances by either Partner, to the extent that they exceed its required proportion of all such unsecured advances by all Partners, shall bear interest at the Prime Rate plus %. Subject to the prior repayment in full of the mortgages referred to in section 5(2), the principal and interest of all such unsecured advances shall be repaid from the Net Cash Flow of the Partnership as follows:

First: until the principal and interest on all such unsecured advances made by the Partners are in the same proportions as their respective Percentage Interests in repayment of the principal and interest accrued and unpaid thereon with respect to all such unsecured advances made by a Partner to the extent, if any, by which they exceed such proportions; and

Then: in the same proportions as their respective Percentage Interests.

Any amount due to the Partnership from a Partner shall, until repaid, be deemed to be an unsecured advance from the Partnership to such Partner and, until retired, shall accrue interest at the rate provided in this section.

ARTICLE VI

MANAGEMENT

EXECUTIVE COMMITTEE

6. (1) The management and control of the Partnership shall be vested in the Executive Committee. The Executive Committee shall be responsible for the establishment of policy and operating procedures respecting the business affairs of the Partnership. Each of the Partners may appoint an alternate for each member appointed by it to the Executive Committee, who, in the absence or inability of such member to serve, shall have all the powers of the members of the Executive Committee whose alternate he is. The Executive Committee shall meet at least once each half-year, at the offices of the Partnership or another mutually agreed upon location (unless such meeting shall be waived by all members thereof) or on the call of any member upon days' notice to all members. An agenda for each meeting shall be prepared in advance by the member convening such meeting. Two members of the Executive Committee shall constitute a quorum. A concurring vote of at least 2 members of the Executive Committee shall govern all its actions. The Executive Committee may act without a meeting if the action taken is approved in advance in writing by 2 members or by all Partners. The Executive Committee shall cause written minutes to be prepared of all action taken by the Executive Committee and shall deliver a copy thereof to each member of the Executive Committee within days thereafter. The Executive Committee by resolution may delegate its power but not its responsibilities, to employees of any Partner or to any other person.

BANK ACCOUNTS 17

6. (2) The Partnership shall maintain bank accounts in such banks as the Executive Committee may designate exclusively for the deposit and disbursement of all funds of the Partnership. All funds of the Partnership shall be promptly deposited in such accounts. The Executive Committee from time to time shall authorize signatories for such accounts.

REIMBURSEMENT FOR COSTS AND EXPENSES

6. (3) Each Partner shall be entitled to an amount equal to % of the remuneration of all its staff employed by the Partnership. The Executive Committee shall fix the amounts, if any, for which the Partnership shall reimburse each Partner for any other costs and expenses incurred by such Partner on behalf and for the benefit of the Partnership. Such amounts shall be paid as earned and incurred.

6. (4) Without the prior written consent of both of the Partners, but subject to section 6(5), the Executive Committee shall not permit the Partnership to, and the Partnership shall not

(a) amend or vary in any way any provision of this agreement;

(b) subject to Article IX, admit any other person to the Partnership;

(d) borrow money except in accordance with the then current annual budget referred to in section 6(5)(b);

(e) subject to the other provisions of this agreement, repay in whole or in part any indebtedness due to any Partner;

(f) directly or indirectly acquire any interest in or be engaged in or make any investment in any business or undertaking other than its business described in section 2(1);

(g) sell, transfer, assign, mortgage or otherwise dispose or grant an option to purchase or right of first refusal in respect of part, or parts of the Property; or

(h) enter into, renew, materially amend, waive any material default in the terms of, grant any approval under or terminate any agreement not in the ordinary course of its business described in section 2(1), including any development, construction, management or real estate brokerage agreement with respect to the Property;

(i) except to the extent provided for in this agreement directly or indirectly enter into 18

any agreement with, or make any contribution to the overhead or general administrative expenses of, or pay any fee, salary, bonus or remuneration to, for or on account of any Partner, or any officer, director, or shareholder of any Partner, or of any Affiliate of any Partner;

(j) settle any claim of the Partnership in respect of the Property where the amount involved is greater than $ or settle any claim against the Partners in respect of the Property for a consideration greater than $ (except where it has been specifically authorized in a budget approved under section 6(4)(c) and the amount is not greater than % of the budgeted amount), or commence any action or legal proceeding on behalf of the Partnership where the amount involved is greater than $ ;

(k) grant, materially amend, terminate or waive any material default under any lease, or approve any mortgage or assignment of such a lease or any subletting of such an area or any part of it;

(l) proceed with any development or expansion of the Property;

(m) except to the extent provided for in this Agreement directly or indirectly

(i) enter into any agreement with,

(ii) make any loan to,

(iii) guarantee any liability of,

(iv) make any contribution to the overhead or general administrative expenses of,

(v) pay any fee, salary, bonus or remuneration to, for or on account of

any Partner, or any officer, director, or shareholder of any Partner, or of any Affiliate of any Partner; or

(n) have any auditors other than the auditors from time to time of the Developer.

TIMELY MAJOR DECISIONS

6. (5) If the Vendor has been given all information available to the Developer and a reasonable time to act under section 6(4) but refuses or is unable to act, or is opposed to the Developer in acting under section 6(4) and such refusal, inability or opposition, in the opinion of the Developer, acting reasonably, could adversely and materially affect or delay the management or development 19 of the Property or any part thereof, then, so long as the Developer's Percentage Interest is not less than %, the Developer, without the approval of the Vendor, but upon prior notice to the Vendor setting out the nature of the action which the Developer proposes to take and its reason therefor, the Developer shall be entitled on behalf of the Partnership, to (a) appoint any consultant, expert, or architect in connection with the Property;

(b) approve the annual operating budget for the Property prepared in accordance with the Management Agreement;

(i) for an amount not greater than % of the amount specifically authorized under section 6(4),

(ii) where the amount involved is not greater than $ for any specific contract or purchase order or the payment of amounts not in excess of $ in the aggregate over a period of less than months, or

(iii) which is of a duration of less than months if it may be terminated without penalty on not more than months' notice;

(d) acquire or dispose of assets (real or personal) of a value not greater than $ for a specific asset or not greater than $ in the aggregate for any assets acquired or disposed of over a period of less than months;

(e) with respect to the Complex

(i) conclude all arrangements for its development, financing, construction and leasing, and

(ii) enter into, renew, amend, waive any default in the terms of, grant any approval under or terminate any agreement; and

(f) at year intervals, adjust the $ threshold limit provided throughout sections 6(4) and 6(5) to an amount which then has substantially equivalent significance in the same context.

Such notice to the Vendor shall afford the Vendor such period of time (not in excess of days) as shall be reasonable in the circumstances for the Vendor to consider such proposal. If the Developer acts under this section without the Vendor's approval and if, in the Vendor's opinion, acting reasonably, such action was improper, the Vendor may refer such action to arbitration. If the arbitrator agrees that such action was improper then the arbitrator shall determine the excess costs incurred by the Partnership as the result of such action over those costs which would have been reasonably anticipated to have been occurred if such action had not been taken or if action of 20 a similar nature had been properly made, and the Developer shall pay such excess costs and the cost of the arbitration. If the arbitrator decides that the Developer acted properly, then all costs of the arbitration shall be paid by the Vendor.

IMPLEMENTATION

6. (6) Approval of any action pursuant to sections 6(4) and 6(5) shall constitute authorization to take all steps necessary to implement, perform and carry out such action, and each Partner shall do all things and execute any and all deeds, transfers, leases, agreements and other documents reasonably required in connection therewith.

EXERCISE OF DISCRETIONS

6. (7) In the exercise of their discretions under this agreement and under the Management Agreement the Executive Committee and the Developer respectively shall act reasonably, prudently and in good faith in the best interests of the Partnership and in accordance with the best management standards management applicable to the Property.

ARTICLE VII

BOOKS AND RECORDS

FISCAL YEAR

7. (l) The fiscal year of the Partnership shall be in each year.

BOOKS, STATEMENTS

7. (2) The Partnership shall keep accurate, full and complete books and accounts of the Partnership showing exclusively its assets and liabilities, operations, transactions and financial condition. All financial statements shall be accurate in all material respects, shall present fairly the financial position and the results of the conduct of the business of the Partnership and shall be prepared in accordance with generally accepted accounting principles consistently applied. Except where specifically provided for in this agreement, the Executive Committee shall determine the methods to be used in the preparation of financial statements and any required federal, provincial and municipal income and other tax returns for the Partnership in connection with all items of income and expense including, but not limited to, valuation of assets, the method of depreciation, elections, credits and accounting procedures. Following the acquisition of the Property by the Partnership 21

(a) the Partnership shall prepare or cause to be prepared a statement setting forth the calculation of Net Cash Flow for each period of time at the end of which the Partnership is to make any distribution of Net Cash Flow and the Partnership shall furnish a copy of such statement to each Partner within days after the end of such period and prior to making any such distribution;

(b) no later than the st day of the month following the end of each period of 6 months in each fiscal year of the Partnership the Partnership shall deliver to each Partner a balance sheet and statement of profit and loss prepared on an accrual basis for the immediately preceding period of months, and no later than the 21st day of the month following the end of each fiscal year of the Partnership the Partnership shall deliver to each Partner a preliminary balance sheet and statement of profit and loss prepared on an accrual basis for the immediately preceding fiscal year end; and

(c) no later than days following the end of each fiscal year of the Partnership, the Executive Committee shall cause the manager of the Property to prepare a set of financial statements for the Partnership in the form described above.

The statement referred to in section 7(2)(c) shall be reported on by the accountants or auditors of the Partnership.

OBJECTION TO STATEMENTS

7. (3) Each Partner shall have the right to object to a statement delivered pursuant to sections 7(2) (a), (b) and (c) by giving notice in writing to the other Partner within such period (not less than days after the delivery of such statement) as is specified in such statement, indicating in reasonable detail the objections of such Partner and the basis for such objections. If no Partner shall have given such notice within such period, such statement and the contents thereof shall be deemed conclusive and binding on the Partners. Objections to any statement and any disputes concerning the findings of and questions raised as the result of audits of the books of the Partnership shall be settled by the Executive Committee or pursuant to Article XII if the Executive Committee cannot agree.

TAX RETURNS

7. (4) The Partnership shall be treated as a partnership for federal, provincial and municipal income tax and other tax purposes. The Partnership shall prepare or cause to be prepared all federal, provincial and municipal tax returns required to be filed by the Partnership, and all financial statements required by each Partner to enable them to file those of such returns which are required to be filed by them, and shall submit the same to each Partner for review and approval no later than days prior to the due date of such returns. The Partners agree that to the extent permitted for income tax purposes, the Partnership shall: 22

(a) expense and write off (but not capitalize) all deductible expenses including, but without limiting the generality of the foregoing, realty taxes, interest, lease commissions, promotional expenses, development fees, management fees, leasing fees, and financing charges;

(b) claim the maximum capital cost allowance allowable to the Partnership against its own income; and

(c) claim the maximum reserve allowable to the Partnership on the gain resulting from the sale or other disposition of all or part of the Property.

CAPITAL ACCOUNTS

7. (5) The Partnership shall maintain a separate capital account for each Partner. Such account shall show all capital contributions made or credited to each Partner, the amount of such Partner's share of the Partnership's net profits, the amount of such Partner's share of the Partnership's net losses and the amount of any distribution (excluding repayment of the principal and interest owing to such Partner as reflected in such Partner's loan account) made to such Partner.

LOAN ACCOUNT

7. (6) The Partnership shall maintain a separate loan account for each Partner. Such account shall show all loans and advances from time to time made by the Partners to the Partnership pursuant to section 5(2) together with any accrued but unpaid interest thereon, and against which shall be debited any repayments of any such loans or advances together with interest owing thereon.

WHERE MAINTAINED

7. (7) The books, accounts and records of the Partnership shall be at all times maintained at the principal office of the Partnership.

ACCESS TO RECORDS

7. (8) Each of the Partners and their respective representatives shall have the right at all reasonable times to examine the books of account and accounting, business and other records of the Partnership. 23

ARTICLE VIII

DISTRIBUTIONS

CASH PAYMENTS

8. (1) Distributions of cash shall be made by the Partnership in accordance with sections 8(2), 10(4) and 10(5).

PERIODIC DISTRIBUTIONS

8. (2) Not later than days after the end of each fiscal quarter (or such other period as the Executive Committee may determine), the Partnership shall distribute the Net Cash Flow of the Partnership for such period to the Partners as follows:

First: in repayment of the Developer mortgage referred to in section 5(2);

Second: in repayment pursuant to section 5(4) of advances by the Partners and interest thereon; and Then: the balance to the Partners in proportion to their respective Percentage Interests.

ADJUSTMENTS TO PERIODIC DISTRIBUTIONS

8. (3)

Notwithstanding section 8(2) any distribution of the Net Cash Flow shall be adjusted so that

(a) the portion of such distribution payable to the Vendor shall be charged with and the portion of such distribution payable to the Developer shall be credited with the amount of the taxes which would be payable at the full corporate tax rate by the Developer by virtue of the capital cost allowance taken by the Partnership being based on an elected amount set out in section 4(5) rather than on the agreed value set out in section 4(4); and

(b) the portion of such distribution payable to the Vendor shall be charged with and the portion of such distribution payable to the Developer shall be credited with the amount (if any) of the taxes payable by the Developer (after first adjusting the amount of such taxes by the amount credited to the Developer pursuant to section 8(3)(a) even if such adjustment results in a negative amount) resulting from the fact that the adjusted cost base of any portion of the Property acquired by the 24

Partnership from the Vendor is an elected amount set out in section 4(5) rather than the agreed value set out in section 4(4).

ARTICLE IX

DISPOSITIONS

CONSENT REQUIRED

9. (1) Except as expressly permitted in this Article, no Partner shall, without the prior written consent of the other, not to be unreasonably withheld;

(a) sell, transfer, assign, convey or otherwise dispose of all or any part of its Percentage Interest; or

(b) create, assume, incur or consent to any lien, mortgage or charge upon all or any part of its Percentage Interest or its rights and interest in or under this agreement. No such consent shall be required to any transfer effected by way of an amalgamation with its affiliate pursuant to the Act under which the transferor is constated.

AFFILIATES

9. (2) Either Partner may, at any time, transfer the whole, but not less than the whole, of its Percentage Interest to an Affiliate.

PERMITTED BORROWING

9. (3) Upon notice to the other Partner, either Partner may hypothecate or create a lien, mortgage or charge upon the whole but not less than the whole of its Percentage Interest to a Canadian chartered bank or an established financial institution in Canada to secure BORROWING therefrom but only if such bank or institution has agreed that the sale by it of such interest so hypothecated to it shall be subject in all respects to this agreement and to any financing of the Property in accordance with this agreement in the same manner and to the same extent as if such bank or institution was the Partner which had hypothecated, liened, mortgaged or charged such interest to it.

RIGHT OF FIRST REFUSAL 25

9. (4) Each of the Partners agrees that, at any time after the Initial Period, but subject to section 9(5)

1. Upon acceptance by it of a Third Party Offer (hereinafter referred to) a Partner (the "Selling Partner") shall give the other Partner (the "Non-Selling Partner") written notice (the "Notice of Offer"),

(a) that it has received from a person acting as principal (the "Third Party Offeror") and has accepted, subject only to compliance with this section, a bona fide, arm's length, irrevocable, unassignable, unconditional offer (except for usual conditions which are not within the control or discretion of the Third Party Offeror) (the "Third Party Offer") to purchase either

(i) the Percentage Interest of each Partner, or

(ii) the Percentage Interest of the Selling Partner; and

(b) offering (in this section referred to as the "Selling Partner's Offer"), irrevocably and unconditionally, to sell all of its Percentage Interest to the Non-Selling Partner on the same terms as the Third Party Offer, except that the purchase price applicable to a Third Party Offer referred to in item 1(a)(i) shall be obtained by multiplying the purchase price in such Third Party Offer (net of commissions payable by the Selling Partner) by the Percentage Interest of the Selling Partner.

2. The Notice of Offer shall be accompanied by

(a) a copy of such Third Party Offer;

(b) reasonable information about the Third-Party Offeror and its financial position (including information regarding the shareholders and principal executives of the Third Party Offeror); and

(i) there is no direct or indirect supplementary consideration (whether or not in the nature of a tangible or intangible asset, money, property, securities, or other benefit) to be received by the Selling Partner or the Third Party in connection with such Third Party Offer, and

(ii) such Third Party Offer is not made as part of or in connection with any other transaction.

3. The Third Party Offer shall provide for 26

(a) a purchase price expressed in Canadian funds payable on closing by

(i) credit to the purchaser for an amount equal to the principal amount of all liabilities of each vendor to the Partnership (with interest, if any, thereon) as at the date of closing, and

(ii) the delivery of a certified cheque for the balance;

(b) the assumption by the purchaser of all such liabilities and of all other obligations of the vendor pursuant to this agreement in the same manner and to the same extent as if the purchaser had been a party to this agreement in the place and stead of the vendor; and

(c) closing at a place in and at a time (specified therein) during banking business hours not later than days after the acceptance of the Third Party Offer.

4. The Selling Partner's Offer shall be open for acceptance by each Non-Selling Partner for a period of days from the date of its receipt by such Non-Selling Partner. The Selling Partner's Offer shall provide for closing at a place in and at a time (specified therein) during banking business hours on a day not less than nor more than days after acceptance of the Selling Partner's Offer.

5. The Third-Party Offer and the Selling Partner's Offer shall not have any terms inconsistent with this Article IX.

6. The Non-Selling Partner shall be entitled, at any time during the period of days following the receipt of the Notice of Offer, to give the Selling Partner written notice, as applicable

(a) accepting the Third-Party Offer;

(b) consenting to the Third-Party Offer; or

If the Non-Selling Partner fails to give such notice within such period, it shall be conclusively deemed to have accepted the Selling Partner's Offer.

7. If the Non-Selling Partner accepts or is deemed to have accepted the Third Party Offer, each of the Partners shall be bound to sell its Partnership Interest to the Third Party Offeror on the terms set out in the Third Party Offer. If the sale, pursuant to such Third Party Offer is not completed in accordance with its terms by the closing date therein provided and without amendment, the parties shall not proceed with such sale or with any other such sale without again complying with the provisions of this section. 27

8. No Third Party Offer shall be deemed to be bona fide unless:

(a) the underlying terms and conditions of such offer are not so unique or unusual as to render it improbable of being matched in Canada on a reasonable commercial basis; and

(b) not less than % of the portion of the purchase price payable by certified cheque at closing is submitted with the offer as a non-refundable deposit (except in the event that the offeree fails to close the transaction).

DISPOSITIONS TO PARTNERS

9. (5) Upon that date which is the day immediately subsequent to the termination of the Partnership

(a) The Developer shall purchase and shall be deemed to have purchased the Vendor's interest in the Complex site for a purchase price equal to

(i) the fair market value thereof as at the end of the Initial Period,

multiplied by

(ii) The Vendor's Percentage Interest as at the end of the Initial Period,

(b) The Vendor shall purchase and shall be deemed to have purchased the Developer's interest in any portion (chosen by it within days after the end of the Initial Period) of the residential area or the study area indicated on Schedule B having a fair market value as at the end of the Initial Period as equal as is practicably possible to the fair market value of the Complex site as at the end of the Initial Period, for a purchase price equal to

(i) the fair market value thereof as at the end of the Initial Period,

multiplied by

(ii) The Developer's Percentage Interest as at the end of the Initial Period,

Each such transaction shall be subject only to the matters applicable thereto referred to in sections 4(1)(a), (b) and (c) and those created by the Partnership pursuant to this agreement. Each of the Developer and the Vendor shall be solely responsible for all costs and expenses incurred from and after the end of the Initial Period in connection with the portion of the Lands so purchased by it and shall be entitled to all proceeds thereof. 28

BUY-SELL RIGHTS

9. (6) A Partner at any time may give notice to the other Partner that it requires the other Partner to purchase the whole of its interest in the Partnership at a price (expressed in Canadian Funds) calculated on the basis therein specified payable by certified cheque upon the completion of the transfer of such interest at a place (in the City of Toronto), at a time (during usual business hours) and on a date (which shall be a banking business day not later than 60 days after the date on which such notice is given to the other Partner) specified in such notice. If the other Partner does not purchase such interest in accordance with such notice such Partner shall be deemed to have sold the whole of its interest in the Partnership to the Partner which gave such notice and the Partner which gave such notice shall be deemed to have purchased such interest at a price calculated on the same basis, and which shall be paid by certified cheque at the place, at the time and on the date specified in such notice.

SALE OF PROPERTY

9. (7) If the Partnership receives an offer which any Partner wishes it to accept for the sale, transfer, assignment or other disposition of the whole of the Property (except pursuant to a mortgage) the Partnership shall accept such offer unless prior to the expiry of days after the delivery of a copy of such offer to the other Partner the other Partner has agreed to acquire the Property at the same price and on the same terms and conditions as are provided for in such offer. If the other Partner does not so agree then the Partner which wishes the Partnership to accept such offer shall be entitled on behalf of the Partnership to accept such offer and to execute and deliver all documents required to complete the transaction with such third party.

COMPLETION OF TRANSACTIONS

9. (8) The following terms and conditions shall apply, as applicable, to all transfers between the Partners pursuant to sections 9(4) and 9(5) as applicable:

1. At the closing of any transfer the vendor shall execute and deliver to the purchaser a transfer of the relevant asset and a transfer and assignment of all rights of the vendor under all instruments, agreements, orders and other documents relating to the asset (herein collectively called the "Transfer Documents"), warranting good and marketable title to such asset subject to no lien, charge, encumbrance or adverse claim (other than those referred to in sections 4(a), (b) and (c) and those created by the Partnership pursuant to this agreement). The Transfer Documents shall be in form satisfactory to counsel for the purchaser, acting reasonably, to convey the asset to the purchaser.

2. The purchase price for the asset shall be subject to the usual adjustments and shall be paid on closing by 29

(a) credit to the purchaser for an amount equal to the outstanding principal amount of all liabilities of each vendor to the Partnership (with interest, if any, thereon) at the date of closing; and

(b) the delivery of a certified cheque for the balance.

On closing, the purchaser shall assume all such liabilities and all other obligations of the vendor pursuant to this agreement in the same manner and to the same extent as if the purchaser had been a party to this agreement in the place and stead of the vendor.

3. Where the liabilities to be assumed by the purchaser exceed the purchase price for the vendor's Percentage Interest, such excess shall be paid by certified cheque by the vendor to the purchaser at the closing.

4. Where the purchase price has not been determined at closing the purchaser shall make a reasonable estimate thereof. If such estimate is not agreed to by the vendor it shall be verified by 2 evaluators as being in their opinion a reasonable estimate of the purchase price. Such opinion shall not necessitate a full investigation but may be based on preliminary inquiries, estimates and such information as is immediately and readily available to them. When the purchase price has been finalized, the appropriate adjustment shall be made and shall bear interest at the Prime Rate.

5. The vendor shall provide the purchaser with

(a) evidence reasonably satisfactory to the purchaser that the vendor is not then a non- resident of Canada within the meaning of the Income Tax Act (Canada), R.S.C. 1985, c. 1 (5th Supp); or

(b) a certificate pursuant to subsection 116(2) of the Income tax Act (Canada) with a certificate limit in an amount not less than the purchase price in question; provided that if such evidence or certificate is not forthcoming, the purchaser shall be entitled to make the payment of tax required under section 116 of the Income Tax Act (Canada) and to deduct such payment from the purchase price in question.

6. If the vendor is not represented at closing or is represented but fails for any reason whatsoever to produce and to execute and deliver the Transfer Documents to the purchaser, then the purchase price payable to the vendor may be deposited by the purchaser into an interest bearing trust account of the purchaser's solicitor. Such deposit shall constitute valid and effective payment of the purchase price to the vendor even thought the vendor, in breach of this agreement, has encumbered or disposed of the asset. Upon the deposit of the purchase price as aforesaid, then from and after the date of such deposit, and even though the Transfer Documents have not been delivered to the purchaser the purchase of the asset shall be deemed to have been fully completed and all right, title, benefit and interest, both 30 at law and in equity, in and to the asset shall be conclusively deemed to have been transferred and assigned to and to have become vested in the purchaser and all right, title, benefit and interest, both in law and in equity, of the vendor or of any transferee, assignee or any other person having any interest, legal or equitable, therein or thereto shall cease and determine. Upon execution and delivery to the purchaser of the Transfer Documents the vendor shall be entitled to receive the purchase price so deposited together with interest accrued thereon.

7. The vendor hereby irrevocably constitutes and appoints the purchaser as its true and lawful attorney-in-fact and agent for, in the name of and on behalf of the vendor to execute and deliver in the name of the vendor all such assignments, transfers, deeds or instruments as may be necessary effectively to transfer and assign to the asset to the purchaser. Such appointments and power of attorney, being coupled with an interest, shall not be revoked by the dissolution, winding-up, bankruptcy or insolvency of the vendor and the vendor hereby ratifies and confirms and agrees to ratify and confirm all that the purchaser may lawfully do or cause to be done by virtue of the provisions hereof. The vendor hereby irrevocably consents to the transfer of the asset pursuant to the provisions of this section.

8. Subject to section 3(5), for income tax purposes, upon any transfer between Partners pursuant to section 9(4) there shall be allocated to the vendor, in accordance with section 96(1.1) of the Income Tax Act (Canada) (and, if applicable to such Partner, under the equivalent provision of the Quebec Taxation Act), for the fiscal year of the Partnership in which such transfer occurs, an amount (the "Stub Period Amount") equal to the Percentage Interest of the vendor for the period from the start of the then current fiscal year to the closing of the purchase and sale transaction as reflected in the financial statements referred to in Item 9 below. The Stub Period Amount shall be included in computing the vendor's income for tax purposes for the fiscal year of the Partnership in which such transfer occurs. Reference in this section includes, mutatis mutandis, the Stub Period amount. The purchaser shall pay the Stub Period Amount to the vendor.

9. Upon the provisions of this section becoming applicable, the Executive Committee shall cause the manager of the Property to prepare financial statements for the Partnership as at and for the fiscal period ending on the last day of the month in which such transfer occurs. Such financial statements shall be prepared in accordance with generally accepted accounting principles consistently applied as if the statement date was as at the fiscal year end of the Partnership.

10. Each Partner shall bear its own expenses in connection with the preparation, execution and delivery of all Transfer Documents.

11. Unless otherwise specified, the closing shall take place at such place and time as the purchaser and vendor may mutually agree upon and, in default of such agreement, at a place in Toronto and at a time during banking business hours (Monday to Friday) specified by the purchaser. 31

12. The purchaser may direct that title to the asset shall be taken in the name of any person.

PRIORITY OF NOTICES

9. (9) At any time after a first notice has been given pursuant to section 9(4) and until the aggregate period of time specified in such section has expired or the Percentage Interest in connection with which such notice has been given has been disposed of, whichever shall first occur, no Partner shall do or cause or permit to be done anything in respect of the Property except in accordance with the current approved budget.

PROHIBITIONS

9. (10) Notwithstanding any other provisions of this agreement, no transfer pursuant to section 9(4) shall be made if

(a) as a result thereof any Partner would be adversely affected by any governmental controls or regulations to which it was not subjected prior to such transfer by reason solely of the nationality or residence of the transferee;

(b) as a result thereof another Partner or its Percentage Interest shall be subject to any taxation to which it was not theretofore subject;

(c) such transfer is not permitted by law or by any term of any mortgage on the Property or any agreement or document affecting the Partners unless any approval required thereunder has been obtained and is in effect;

(d) except as permitted by section 9(8)(e), the transferee is not a corporation incorporated under the laws of Canada or one of the provinces thereof unless otherwise approved by the Partners;

(e) the transferee (if it is an Affiliate of the transferor) is not a corporation incorporated under the laws of Canada, one of the provinces of Canada, unless otherwise approved by the Partners; or

(f) if the transfer is for less than all of the transferor's Percentage Interest; and any transfer which would procure such result shall be void. 32

PURCHASE OF INDEBTEDNESS

9. (9) Upon the completion of the transfer of a Partner's Percentage Interest pursuant to section 9(l), 9(2), or 9(4) the purchaser of such Percentage Interest shall also purchase from the vendor and the vendor shall sell to the purchaser all advances due to the Vendor under section 5(4) for a purchase price, in the case of a transfer between the Partners, equal to the total principal amount thereof and interest accrued thereon payable in the same manner as the purchase price payable for the Percentage Interest so purchased.

TRANSFEREE ASSUMPTION OF PARTNERSHIP OBLIGATIONS

9. (10) As a condition precedent to a person acquiring a Percentage Interest from a Partner, the transferee shall enter into an agreement with the other Partner in a form reasonably satisfactory to that other Partner agreeing to the extent of the Percentage Interest to be transferred to the transferee and to be bound by and observe the provisions of this agreement in the same manner and to the same extent as if originally named in this agreement as the transferor. Any such transfer, other than a transfer pursuant to section 9(2), shall release the transferee from performance of its covenants, obligations or agreements under this agreement.

EFFECT OF ASSIGNMENT

9. (11) No sale, transfer, assignment, pledge, hypothecation, mortgage, charge, encumbrance or other disposition permitted under this Article shall terminate the Partnership. Any purported sale, transfer, assignment, pledge, hypothecation, mortgage, charge, encumbrance or other disposition of an interest in the Partnership not permitted by this Article shall be null and void and of no effect whatsoever.

ARTICLE X

TERMINATION AND LIQUIDATION

DISSOLUTION

10. (1) Upon termination of the Partnership pursuant to any provision of this agreement the Partnership shall be dissolved and the business of the Partnership shall be wound up and all its assets distributed in liquidation. Upon such dissolution each of the Partners shall elect that the rules provided for in section 98(3) of the Income Tax Act (and under the equivalent provision of the Quebec Taxation Act) if applicable, shall apply.

TERMINATION 33

10. (2) The Partnership shall terminate forthwith upon the first to occur of the following events:

(a) the failure of the Partnership to purchase the Property in accordance with this Agreement;

(b) the purchase by a Partner of all of the other Partner's Percentage Interest;

(c) the sale, transfer, assignment or other disposition by the Partnership (except by way of a mortgage) of all or substantially all of the Property;

(d) the unanimous agreement of the Partners; or

(e) notice from a Partner given at any time after the date which is the earlier of

(i) the third anniversary of the expiry of the Initial Period, and

(ii) the sale by the Partnership of all the lands comprised in the Property and the payment in full to the Partnership of all vendor take-back mortgages granted by the Partnership in respect of such sale.

CO-LIQUIDATING PARTNERS

10. (3) Upon termination of the Partnership pursuant to section 10(2)(b) or (c) the Partners shall be co-liquidating Partners and, acting through the Executive Committee, shall wind up the Partnership and in such winding up shall, subject to section 9(5),

(a) cause the whole of the assets of the Partnership, or such of the assets of the Partnership which are subject to a non-severable mortgage or which are not otherwise readily severable or distributable in kind, to be sold and shall distribute the proceeds of such sale pursuant to section 10(5); and

(b) distribute any other assets of the Partnership to the Partners in proportion to their respective Percentage Interests.

DISTRIBUTION OF NET CASH FLOW

10. (4) During the period of liquidation of the Partnership the parties shall continue to receive the Net Cash Flow and to share profits and losses in the same manner and to the same extent as if the Partnership had not terminated. 34

DISTRIBUTION OF PROCEEDS OF LIQUIDATION

10. (5) Regardless of the capital and undistributed earnings accounts of the Partners or their shares of profits and losses, the proceeds from liquidation of the Partnership shall be applied and distributed in the following order of priority:

First: to the payment of

(a) debts and liabilities of the Partnership except loans or advances that may have been made by any Partner to the Partnership; and

(b) expenses of liquidation;

Second: to the setting up of any reserves which the liquidating Partners may reasonably deem necessary for any contingent liabilities or obligations of the Partnership or of the Partners out of or in connection with the Partnership. Such reserves may be paid over by the Partners to a bank or trust company acceptable to the liquidating Partners as escrowee to be held by it for the purpose of disbursing such reserves in payment of any of such liabilities or obligations, and at the expiration of such period as the liquidating Partners shall deem advisable, distributing the balance, if any, thereafter remaining, in the manner provided in this section; and

Then: in accordance with section 8(2).

ORDERLY LIQUIDATION

10. (6) A reasonable time shall be allowed for the orderly liquidation of the assets of the Partnership and the discharge of liabilities to creditors so as to enable the Partners to minimize the losses normally attendant upon a liquidation.

NO PROCEEDINGS

10. (7) Except as provided in this agreement, no Partner shall have any right to dissolve the Partnership. Notwithstanding any rule of law or equity to the contrary no Partner shall have the right to or shall make any application or petition for, nor commence or prosecute any action or proceeding for the dissolution of the Partnership or for the partition or sale of the Property. Any Partner shall be entitled to a decree or order restraining or enjoining any such application, petition, action or proceeding and may plead this section as an estoppel to any defense to the application for such decree or order, it being acknowledged and agreed that the injury resulting from a breach of this section would be irreparable and could not be measured in damages. 35

ARTICLE XI

DEFAULT

EVENTS OF DEFAULT

11. (1) An event of default by a Partner shall occur when

(a) such Partner shall be in default under any of the provisions of this agreement and such default shall continue after written notice thereof has been given by the other Partner for such period as shall be reasonable in the circumstances to cure such default;

(b) such Partner shall become insolvent or bankrupt or subject to the provisions of the Winding-up and Restructuring Act, R.S.C. 1985, c. W-11 or the Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3 or shall go into liquidation, either voluntary or under an order of a court of competent jurisdiction, or make a general assignment for the benefit of its creditors, or otherwise acknowledge its insolvency;

(c) if a liquidator, receiver, receiver and manager, or trustee in bankruptcy be appointed to or of the Percentage Interest of such Partner or any part thereof with the consent or acquiescence of such Partner, or such appointment shall remain unvacated and unstayed for days after written notice thereof is given by any other Partner or such longer period as is reasonable (but not in any event exceeding days) as long as such Partner is acting with all due diligence to cure such Event of Default; or

(d) if an encumbrancer takes possession of the Percentage Interest of such Partner or any substantial part thereof, or if a distress or execution or any similar process be levied or enforced upon or against such Percentage Interest and such claim remains unsatisfied for the shorter of a period of 30 days or such period as would permit the same to be sold; provided that

(i) such process is not in good faith being diligently disputed by such Partner; and

(ii) such non-payment shall not jeopardize the title to the other Partner's Percentage Interest, and

(iii) if such Partner shall have given security sufficient to pay in full the amount claimed. 36

The occurrence of more than one of the circumstances set forth in sections 11(1)(a) to (d), inclusive, with respect to the same Partner shall be deemed to be a separate event of default.

REMEDIES AVAILABLE TO A NON-DEFAULTING PARTNER

11. (2) If an event of default in respect of either Partner shall have occurred then, until such event of default is cured, the other Partner shall have the right to:

(a) bring any proceedings in the nature of specific performance, injunction, or other equitable remedy, it being acknowledged by the parties hereto that damages at law may be an inadequate remedy for a default or breach of this agreement;

(b) remedy such event of default and, upon demand, to be reimbursed by the defaulting Partner for all amounts expended to remedy any such event of default;

(c) bring such action at law as may be necessary or advisable in order to recover damages to such non-defaulting Partner arising from such event of default; and

(d) treat such amounts as an advance by it pursuant to section 5(4).

ARTICLE XII

ARBITRATION

12. (1) If any matter is to be resolved by arbitration pursuant to section 6(5) such matter shall be referred to a single arbitrator agreed to by the parties or, in default of agreement, appointed on the application of either Partner by a judge of the Supreme Court of Ontario. The decision of such arbitrator shall be final and binding upon the parties and shall be complied with by the parties.

COSTS OF ARBITRATION

12. (2) Subject to any contrary provision of this agreement, the applicable fees, expenses and charges of every such arbitrator shall be borne equally by the parties unless such arbitrator shall otherwise direct. 37

NO DEFAULT DURING ARBITRATION

12. (3) During the period of any arbitration under this agreement, no default shall be deemed to have occurred in the performance of any covenant, obligation or agreement which is the subject matter of such arbitration.

ARTICLE XIII

MISCELLANEOUS

NOTICES

13. (1) Any notice, demand or request to any party shall be in writing and shall be deemed to have been validly given only when it or a facsimile thereof has been received at the address of such party shown in this agreement or to such other address as such party shall have given notice.

ADDITIONAL DOCUMENTS AND ACTS

13. (2) Each party shall execute and deliver such additional documents and instruments and shall perform such additional acts as may be necessary or appropriate in connection with this agreement and all transactions contemplated by this agreement to effectuate, carry out and perform all of the covenants, obligations and agreements of this agreement and such transactions.

TIME OF THE ESSENCE

13. (3) Time shall be of the essence of this agreement; provided that notwithstanding any other provision of this agreement, whenever, and to the extent that a party to this agreement shall be unable to fulfil, or shall be delayed or restricted in the fulfilment of any obligation (other than the payment of any moneys) under any provision of this agreement by reason of any matter not caused by the default or act of or omission by such party and not avoidable by the exercise of reasonable effort or foresight by such party, then, so long as any such impediment exists, such party shall be relieved from the fulfilment of such obligation and no other party shall be entitled to compensation for any damage, inconvenience, nuisance or discomfort thereby occasioned.

APPROVALS

13. (4) Whenever in this agreement any matter requires the approval of a party such approval shall be deemed to have been given unless within days, or such longer period as may be necessary in the circumstances to consider and act on such matter, after the request to it for such approval such party shall have notified the party requesting such approval of the reasons for 38 its refusal to give such approval.

PLANNING ACT

13. (5) This agreement is subject to compliance with the provisions of section 50 or the Planning Act, R.S.O. 1990, c. P.15 or any successor legislation or other statute which may be passed to take the place of the said Act or to amend the same.

AUTHORIZATION

13. (6) Each of the parties has all requisite power and possesses all licences, franchises, permits, consents and other rights necessary to enable it to enter into this agreement.

WAIVERS

13. (7) No waiver by a party of any breach by another party of any of the covenants, obligations or agreements under this agreement shall be a waiver of any subsequent breach or of any other covenant, obligation or agreement, nor shall any forbearance to seek a remedy for any breach be a waiver of any rights and remedies with respect to such or any subsequent breach.

SEVERABILITY

13. (8) If any covenant, obligation or agreement of this agreement or the application thereof to any person or circumstance shall, to any extent, be invalid or unenforceable, the remainder of this agreement or the application of such covenant, obligation or agreement to persons or circumstances other than those as to which it is held invalid or unenforceable, shall not be affected thereby and each covenant, obligation and agreement of this agreement shall be separately valid and enforceable to the fullest extent permitted.

CHANGES REQUIRED BY CONTEXT

13. (9) This agreement shall be read with all changes of gender and number required by the context.

HEADINGS

13. (10) The article headings and section headings in this agreement have been inserted for convenience of reference only and do not form part of this agreement. They shall not be referred 39 to in the interpretation of this agreement.

WHOLE AGREEMENT

13. (11) This agreement supersedes all prior agreements, arrangements and communications and contains and constitutes the entire agreement between the parties with respect to the subject matters provided for in this agreement. There are no understandings, inducements, representations, warranties, collateral agreements or conditions affecting or supported by this agreement or upon which any party has relied in entering into this agreement other than as expressed in this agreement. This agreement may be amended or modified only by a written instrument signed by each of the parties. All guarantees, exhibits, schedules and appendices to this agreement form part of this agreement.

APPLICABLE LAW

13. (12) This agreement shall be construed in accordance with the laws of Ontario and of Canada applicable therein, without regard to principles of conflict of laws. Except for the purposes of Article XII, no action or other proceeding shall be brought to construe or enforce this agreement except in the English language and in those courts having jurisdiction in that Province. Each of the parties hereby attorns to the jurisdiction of such courts.

LEGISLATION

13. (13) Reference to any legislation means such legislation as amended and in effect at the relevant time.

ASSIGNS

13. (14) This agreement shall enure to the benefit of and be binding upon the parties hereto, shall be binding upon their respective successors and assigns and shall enure to the benefit of and be enforceable by only such successors and assigns which have succeeded or which have received such assignment in the manner permitted by this agreement.

COUNTERPARTS

13. (15) This agreement has been executed in a number of counterparts, each of which shall be deemed an original and all of which shall constitute one and the same agreement. 40

DULY EXECUTED BY:

Per: Authorized Signing Officer

Per: Authorized Signing Officer - 41 -

THE DEVELOPER GUARANTEE

In consideration of the execution and delivery of this Partnership Agreement by The Vendor Inc., The Developer Limited, in the same manner and to the same extent as if named herein as The Developer Inc., hereby unconditionally and irrevocably assumes and agrees with The Vendor Inc. to perform each of the covenants, obligations and agreements of The Developer Inc. provided for in this Partnership Agreement until all of such covenants, obligations and agreements have been fully and completely performed, all without limitation as to the amount of any particular period of time and without regard to any right of set-off or counter-claim. The liability of The Developer Limited. under this guarantee shall not be affected in any manner by

(a) the neglect, forbearance or failure of The Vendor Inc. to take any action with respect to any default by The Developer Inc. in the performance of its covenants, obligations and agreements provided for in this Partnership Agreement;

(b) the taking or release of any collateral or other security; or

(c) any waiver, release, discharge, loss, delay, failure, compromise, compounding, arrangement or extension of time by The Vendor Inc. The liability of The Developer Limited under this Partnership Agreement shall be construed as an absolute, continuing and unlimited guarantee of the covenants, obligations and agreements of The Developer Inc. provided for in this Partnership Agreement. Before resorting to The Developer Limited for performance of the covenants, obligations and agreements of The Developer Inc. provided for in this Partnership Agreement the Vendor Inc. shall not be required to proceed first against the Developer Inc. nor to have exhausted its remedies against the Developer Inc. or any other person liable with respect thereto, or against any security therefor. The Developer Limited hereby waives the making of any demand for payment or performance upon The Developer Inc. or the Developer Limited and the giving of any notice to which The Developer Inc. or the Developer Limited might otherwise be entitled under this Partnership Agreement.

Per: Authorized Signing Officer