LOCNEST GUARANTEE OF A RESIDENTIAL LEASE

The terms and conditions herein govern the rights and obligations of LOCNEST HOLDING INC. (“LOCNEST”) with respect to its guarantee of the obligations of the tenant(s) (each of such tenants, and all of them collectively, are herein the “Lessee”) under the lease (the “Lease”) between the Lessee and the landlord (the “Lessor”) for the leased dwelling described on the attached Schedule A (the “Premises’).

Article 1. Guarantee: LOCNEST hereby agrees to guarantee to the Lessor the payment and performance when due of all the covenants, obligations, and responsibilities of the Lessee pursuant to the Lease (the “Obligations”), within the limits and subject to conditions set forth herein and up to the maximum amount specified on the attached Schedule A (the “Guarantee Amount”).

This Guarantee shall replace any prior guarantee provided by LOCNEST in respect of the Lease; in the event that LOCNEST has entered into more than one guarantee of the Lease, only the most recently dated one will be valid.

Article 2. Exclusions: The obligations of LOCNEST under this Guarantee do not apply or are limited, as applicable, as follows:

  1. LOCNEST guarantees the performance only of the Obligations to be performed between the Start Date and End Date of this Guarantee (which shall include rent and other amounts payable in respect of that period only) as described in Article 4.;

  2. the Guarantee Amount excludes any amount in respect of the first month of the Lease;

  3. the Guarantee Amount will be reduced by any rent or security deposit, or other amount held by the Lessor on account of the Obligations, or any other amount paid to the Lessor on account of the Guarantee Amount;

  4. in the event that LOCNEST pays an amount to the Lessor pursuant to this Guarantee, the Guarantee Amount will be reduced by the amount paid;

  5. in the event of a sublease, LOCNEST does not guarantee the performance of the sub-lessee's obligations to the Lessee, nor the Lessee's obligations to the sub-lessee resulting from the sublease (but the Lessee's Obligations under the Lease shall continue to be guaranteed by this Guarantee, subject to the terms and conditions set forth herein);

  6. this Guarantee will be null and void and LOCNEST will not have any obligation to the Lessor pursuant to this Guarantee or otherwise if:

    1. the Lease does not provide that the responsibility of all of the

      lessees and/or co-signers is, in Quebec, solidary and, in the rest of Canada, joint and several;

    2. if the Lease is not in respect of a residential dwelling or if

      the Lease relates to a residential dwelling that is not situated in Quebec, Ontario, British Columbia, or Alberta;

    3. the Lease is renewed or extended, or otherwise amended in any

      material respect, other than a renewal or extension at the end of term of the Lease by agreement of the Lessor and Lessee or by operation of law, or any increase in rent imposed by the Lessor upon such renewal or extension, to the extent permitted by applicable law, notice of which is provided to LOCNEST in accordance with Article 4;

    4. the Lessor does not notify LOCNEST of any material breach or

      default of the Obligations in accordance with Article 3;

    5. if any fees payable to LOCNEST in consideration for providing

      this Guarantee as set out in Schedule A are not paid when due.

Article 3. Payment of this Guarantee: The Lessor may demand payment by LOCNEST under this Guarantee following a breach or default by the Lessee of its Obligations under the Lease when due and payable upon the delivery to LOCNEST by the Lessor of copies of this Guarantee, the signed Lease and any of the following:

  1. an acknowledgement by the Lessor and the Lessee (or the Lessee’s representative) of the Lease default, including the amount owing under the Lease;

  2. an enforceable judgment or order, not appealed, confirming the Lessee’s breach or default of the Lease; or

  3. an enforceable judgment or order, not appealed, (i) declaring that the Lessee is bankrupt, or (ii) effecting a proposal filed by the Lessee pursuant to the Bankruptcy and Insolvency Act; or

  4. a notice of the assignment or petitioning in bankruptcy of the Lessee, issued by a licensed insolvency trustee under the Bankruptcy and Insolvency Act.

The Lessor shall also provide any additional information reasonably requested by LOCNEST regarding amounts paid or payable on account of the Obligations, including without limitation, the amount of any rent or security deposits held by the Lessor. All documents to be delivered to LOCNEST hereunder shall be submitted by the Lessor electronically through LOCNEST’s website, or in such other manner requested by LOCNEST. LOCNEST may require, in its sole discretion, authentication of any documents submitted to it hereunder, by a notary, commissioner of oaths or, in the case of signatures, or a signature guarantee or electronic signature verification from a recognized source (such as Medallion or DocuSign).

LOCNEST shall pay the Lessor all amounts owing under this Guarantee within ninety (90) days of receipt of all documents required to be delivered to it hereunder.

In the event of any breach or default by the Lessee of the Obligations, the Lessor shall (i) take commercially reasonable actions to enforce its rights under the Lease, which shall include, subject to applicable law, commencing and diligently pursuing eviction proceedings within forty-five (45) days of any failure to pay rent when due; (ii) notify LOCNEST in writing within thirty (30) days of becoming aware of such breach or default, and provide any additional information on the enforcement actions taken by the Lessor as a result thereof from time to time as reasonably requested by LOCNEST; and (iii) permit LOCNEST to take any actions, including engaging a lawyer or collection agency and/or initiating legal proceedings, on behalf and in the name of the Lessor, to evict the Lessee or otherwise enforce the Lessor’s rights under the Lease as reasonably requested by LOCNEST, subject to applicable law, at any time prior to or after payment of any amounts by LOCNEST under this Guarantee.

LOCNEST acknowledges and agrees that, except as otherwise expressly provided otherwise herein, the Obligations are continuing, absolute and unconditional and, without limiting the generality of the foregoing, LOCNEST’s obligations under this Guarantee shall not be released, discharged, diminished, limited or otherwise affected by (and LOCNEST hereby consents to or waives, as applicable, to the fullest extent permitted by applicable law): (i) any lack or limitation of power, incapacity or disability on the part of Lessee or the Lessor, (ii) the insolvency, bankruptcy, reorganization, winding-up or financial condition of any of LOCNEST, the Lessor or the Lessee at any time; (iii) any defence based upon or arising out of any bankruptcy, insolvency, reorganization, moratorium, arrangement, liquidation, dissolution or other proceeding commenced by any of LOCNEST, the Lessee or the Lessor or any other person; (iv) any loss or impairment of any right of LOCNEST to subrogation, reimbursement or contribution; (v) any fraud on the part of the Lessee with respect to any or all of the Obligations; (vi) any other act or omission of any kind by LOCNEST, whether similar or dissimilar to the foregoing, which would, but for the provisions of this Section constitute a legal or equitable discharge, limitation or reduction of the LOCNEST’s obligations under this Guarantee (other than performance in full of the Obligations).

Article 4. Term of this Guarantee: This Guarantee takes effect on the date of this Guarantee, or on the date of commencement of the term of the Lease, whichever occurs last (the “Start Date”). This Guarantee ends at the date (the “End Date”) of the earliest of the following events:

  1. the consent of the Lessee, the Lessor

  2. two weeks after the month in which the Lessee vacates the Premises;

  3. a termination or a non-renewal of the Lease;

  4. an assignment of the Lease by the Lessee;

  5. a change of use of the leased premises for any non-residential purpose;

  6. a termination or a non-renewal of this Guarantee for failure of payment as outlined in Schedule A;

  7. the first anniversary of the Start Date or, if this Guarantee is renewed, the next anniversary thereof.

If the term of the Lease is renewed or extended, by written agreement of the Lessor and Lessee or by operation of law, this Guarantee shall continue provided that;

  1. a copy of such written agreement, or written notice of the new term of the Lease if renewed or extended by operation of law (together with any change to the rent), is received by LOCNEST within thirty (30) days of the expiry of the prior term.

  2. Locnest’s renewal offer is accepted and payment for the Guarantee has been made in accordance with Schedule A

In the event of a voluntary or forced transfer of the building containing the leased dwelling, this Guarantee will benefit the new Lessor, provided that LOCNEST is notified in writing of the transfer of ownership of the building within thirty (30) days of the transfer.

Article 5. Right of Recourse and Subrogation, Co-Lessees, and Co-signers: If LOCNEST pays the Lessor any amount pursuant to this Guarantee, LOCNEST is subrogated to the rights of the Lessor and is authorized to pursue remedies against the Lessee, and any other guarantor of the Lease, for all amounts paid by LOCNEST to the Lessor until fully paid, and any amounts thereafter paid to the Lessor by or on behalf of the Lessee shall promptly be paid to LOCNEST up to the amount paid by LOCNEST pursuant to this Guarantee. Interest, at the rate of 12% per year calculated daily and compounded monthly, will be charged to the Lessee on any outstanding amounts paid under this Guarantee until repaid by the Lessee. The Lessee undertakes to reimburse LOCNEST for all reasonable costs incurred in collecting any amounts that remain unpaid, including legal fees.

Article 6. Obligations of the Lessor: If the Lease ends or if the Lessee leaves the leased dwelling, the Lessor is required to so inform LOCNEST as soon as possible but no later than within thirty (30) days. The Lessor is also required to inform LOCNEST without delay if the Lessor makes any claims against the Lessee pursuant to the Lease, whether during the Lease or afterwards.

Article 7. LOCNEST’S RESPONSIBILITY: EXCEPT AS EXPRESSLY PROVIDED HEREIN, LOCNEST, ITS AFFILIATES AND ITS AND THEIR RESPECTIVE OFFICERS, SHAREHOLDERS, EMPLOYEES, AGENTS, DIRECTORS, SUCCESSORS, ASSIGNS, AND SUPPLIERS SHALL NOT BE HELD LIABLE IN ANY CASE, FOR ANY INDIRECT, SPECIAL, ACCESSORY, PUNITIVE, EXEMPLARY OR CONSEQUENTIAL DAMAGES, INCLUDING, WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, THE LOSS OF PROFIT OR INCOME, THE LOSS OF THE ENJOYMENT OF PROPERTY OR OF ANY RELATED CLAIM, THE COST OF CAPITAL, THE COST OF REPLACEMENT PRODUCTS, FACILITIES OR SERVICES, THE COST OF DOWNTIME, OR THE CLAIMS BY THE LESSOR, THE LESSEE OR THIRD PARTY FOR SUCH DAMAGES, REGARDLESS OF WHETHER THE LIABILITY IS BASED ON CIVIL LIABILITY (CONTRACTUAL OR EXTRACONTRACTUAL), TORT (INCLUDING NEGLIGENCE) OR ANY OTHER LEGAL BASIS. THE AGGREGATE LIABILITY OF LOCNEST, ITS AFFILIATES AND ITS AND THEIR RESPECTIVE OFFICERS, SHAREHOLDERS, EMPLOYEES, AGENTS, DIRECTORS, SUCCESSORS, ASSIGNS AND SUPPLIERS FOR ALL CLAIMS WITH RESPECT TO THIS GUARANTEE CANNOT EXCEED THE GUARANTEE AMOUNT.

Article 8. Notices: Any communication and any notification from LOCNEST to the Lessee and to the Lessor relating to this Guarantee shall be validly sent electronically, including through the automated technological procedures accessible on LOCNEST’s website (i.e., tenant portal), to the email address indicated on the Guarantee or to any new email address provided in writing by the Lessee or by the Lessor or its authorized representative.

Article 9. Amendments:

LOCNEST reserves the right to amend at any time the terms and conditions of its guarantee of a residential lease, provided that no such amendment will affect this Guarantee without written consent of LOCNEST, the Lessee and the Lessor.

Article 10. Applicable Law and Choice of Forum: This Guarantee, these Terms and Conditions and the Guarantee shall be governed by the applicable laws of the province where the Premises are located and the laws of Canada, applicable therein, without regard to conflict of laws principles that would provide for the application of the law of any other jurisdiction. The Lessor, the Lessee, and LOCNEST agree to attorn to the jurisdiction of the following courts, as applicable:

  1. if the Premises is located in Quebec, the courts of the district of Montreal;

  2. if the Premises is located in Ontario, the courts sitting in the City of Toronto;

  3. if the Premises is located in Alberta, the courts of the district of Calgary; and

  4. if the Premises is located in British Columbia, the courts sitting in the City of Vancouver.

Article 11. Miscellaneous: Should any provision of this agreement be declared invalid, void or otherwise unenforceable for any reason whatsoever, such provision shall be automatically severed and no longer form part of this agreement, and the application and validity of other provisions hereof shall not be thereby affected. LOCNEST may assign in whole or in part its rights resulting from this Guarantee, these Terms and Conditions or the Guarantee at any time and without the consent of the Lessee or of the Lessor.

Article 12. Language of Agreement: The parties confirm that it is their wish that this agreement, as well as any other documents relating to this agreement, including notices, schedules and authorizations, have been and shall be drawn up in the English language only. Les signataires confirment leur volonté que la présente convention, de même que tous les documents s’y rattachant, y compris tout avis, annexe et autorisation, soient rédigés en anglais seulement.