LEASE AGREEMENT

Exhibit 10.17

LEASE AGREEMENT

BY AND BETWEEN

EXECUTIVE II LIMITED PARTNERSHIP

AND

SSP SOLUTIONS, INC.

EXECUTIVE II MASTER LEASE

Control Date: 01/15/04

MASTER LEASE 03/02/00

 

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TABLE OF CONTENTS

 

 

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LEASE AGREEMENT

THIS LEASE AGREEMENT (this “Lease”) is dated as of January      , 2004, by and between EXECUTIVE II LIMITED PARTNERSHIP, a Virginia limited partnership (“Landlord”), and SSP SOLUTIONS, INC., a Delaware corporation (“Tenant”).

ARTICLE I

Definitions

1.1 Building: A five (5) story office building containing approximately seventy-six thousand nine hundred fourteen (76,914) square feet of rentable area, known as Commerce Executive Park Building II and located on approximately 3.22 acres of land at 11490 Commerce Park Drive, Reston, Virginia 20191 (the “Land”).

1.2 Premises: Approximately five thousand one hundred thirty (5,130) square feet of rentable area located on the fifth (5th) floor of the Building and outlined on Exhibit A.

1.3 Lease Term: Sixty-two (62) months.

1.4 Anticipated Occupancy Date: February 1, 2004.

1.5 Base Rent: One hundred fifteen thousand four hundred twenty-five and no/100 dollars ($115,425.00) for the first Lease Year (which amount is based on twenty-two and 50/100 dollars ($22.50) per square foot of rentable area).

1.6 Base Rent Annual Escalation Percentage: Three percent (3%).

1.7 Operating Charges Base Year: Calendar year 2004.

1.8 Security Deposit: Nine thousand six hundred eighteen dollars and seventy-five cents ($9,618.75).

1.9 Broker(s): Trammell Crow Company and Transwestern Commercial Services.

1.10 Tenant Address for Notices: 17861 Cartwright Road, Irvine, CA 92614, until Tenant has commenced beneficial use of the Premises, and 11490 Commerce Park Drive, Reston, Virginia 20191, after Tenant has commenced beneficial use of the Premises.

1.11 Complex: That complex (of which the Building is a part) known as Commerce Executive Park and located on approximately 27 acres of land at Weihle Avenue and Sunrise Valley Drive, Reston, Virginia.

 

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ARTICLE II

Premises

2.1 Tenant leases the Premises from Landlord upon the terms stated herein. Tenant will have the non-exclusive right to use the common and public areas of and the surface parking spaces appurtenant to the Building.

2.2 Landlord shall have the right to change the location and configuration of the Premises subject to the following terms and conditions: (a) if Tenant has commenced beneficial use of the Premises, then Landlord shall provide Tenant not less than thirty (30) days’ advance written notice of the/ date Tenant must vacate the Premises; (b) Landlord shall provide Tenant with substitute space of similar nature and size elsewhere in the Building (the “Substitute Premises”); and (c) Landlord shall at Landlord’s expense (1) remove Tenant’s equipment and furniture from the Premises and reinstall them in the Substitute Premises, and (2) redecorate the Substitute Premises in a manner substantially similar to the manner in which the Premises were decorated. Within ten (10) days after Landlord submits an amendment of this Lease indicating the location and configuration of the Substitute Premises, Tenant shall execute such amendment.

2.3 Tenant shall have use of the existing furniture in the Premises for the Lease Term. Attached hereto as Exhibit B is an inventory of the existing furniture. All such furniture shall remain in the Premises during the Lease Term. Provided Tenant occupies the Premises for the entirety of the Lease Term and further provided that there has been no Event of Default on the part of Tenant, at the end of the Lease Term all such furniture shall become the property of Tenant and shall be removed from the Premises.

2.4 Tenant shall have the right, at Tenant’s option, to assume the lease for the existing phone system within the Premises (subject to all terms and conditions of said phone system lease). In the event Tenant assumes the phone system lease, Tenant shall be responsible for all costs and fees, including transfer fees, relating thereto. In the event Tenant elects not to assume the phone system lease, Landlord agrees to remove the phone system from the Premises. Tenant shall notify Landlord of its intention to assume the phone system lease within ten (10) days from the date of execution of this Lease.

 

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ARTICLE III

Term

3.1 The Lease Term shall commence on the Lease Commencement Date specified in Section 3.2. If the Lease Commencement Date is not the first day of a month, then the Lease Term shall be the period set forth in Section 1.3 plus the partial month in which the Lease Commencement Date occurs. The Lease Term shall also include any renewal or extension of the term of this Lease.

3.2 The Lease Commencement Date shall be the earlier of (a) the Anticipated Occupancy Date set forth in Section 1.4, or (b) the date Tenant commences beneficial use of the Premises. Tenant shall be deemed to have commenced beneficial use of the Premises when Tenant begins to move furniture, furnishings, inventory, equipment or trade fixtures into the Premises. Promptly after the Lease Commencement Date is ascertained, Landlord and Tenant shall execute a certificate (in the form of Exhibit C) confirming the Lease Commencement Date.

3.3 It is presently anticipated that the Premises will be delivered to Tenant on or about the Anticipated Occupancy Date. If Landlord does not deliver possession of the Premises by such date, then Landlord shall not have any liability whatsoever and this Lease shall not be rendered voidable, on account thereof.

3.4 Lease Year shall mean a period of twelve (12) consecutive months commencing on the Lease Commencement Date and each successive twelve (12) month period thereafter; provided, however, that if the Lease Commencement Date is not the first day of a month, then the second Lease Year shall commence on the first day of the month in which the first anniversary of the Lease Commencement Date occurs.

3.5 Landlord hereby grants to Tenant the conditional right, exercisable at Tenant’s option, to terminate this Lease upon the last day of the thirty-eighth (38 ^th ) month of the Lease Term. If exercised, and if the conditions applicable thereto have been satisfied, the Lease Term shall be amended to be thirty-eight (38) months. The right of termination granted to Tenant shall be subject to and shall be exercised in accordance with the following terms and conditions:

(a) Tenant shall exercise its right of termination by giving Landlord written notice of such election not earlier than two hundred forty (240) days nor later than one hundred eighty (180) days prior to the expiration of the thirty-eighth (38 ^th ) month of the initial Lease Term.

(b) Tenant’s notice of termination shall be accompanied by Tenant’s payment to Landlord of an early termination payment in the amount of the sum of ten thousand five hundred ten and 67/100

 

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dollars ($10,510.67) (which amount is based on one month’s escalated Base Rent) plus the unamortized leasing commission for months thirty-eight (38) through sixty-two (62).

(c) Tenant’s right of termination under this Section may be exercised only by Tenant or Tenant’s Affiliate, and may not be exercised by any other transferee, assignee or sublessee of Tenant.

ARTICLE IV

Base Rent

4.1 Tenant shall pay the Base Rent in equal monthly installments in advance on the first day of each month during a Lease Year. On the first day of the second and each subsequent Lease Year, the Base Rent in effect shall be increased by the product of (a) the Base Rent Annual Escalation Percentage, multiplied by (b) the Base Rent in effect. Concurrently with Tenant’s execution of this Lease, Tenant shall pay an amount equal to one (1) monthly installment of the Base Rent payable during the first Lease Year, which amount shall be credited toward the monthly installment of the Base Rent payable for the third full calendar month of the Lease Term. If the Lease Commencement Date is not the first day of a month, then the Base Rent from the Lease Commencement Date until the first day of the following month shall be prorated on a per diem basis at the rate of one-thirtieth (l/30th) of the monthly installment of the Base Rent payable during the first Lease Year, and Tenant shall pay such prorated installment on the Lease Commencement Date.

4.2 All sums payable by Tenant shall be paid to Landlord in legal tender of the United States, at the address to which notices to Landlord are to be given or to such other party or such other address as Landlord may designate in writing. Landlord’s acceptance of rent after it shall have become due and payable shall not excuse a delay upon subsequent occasions or constitute a waiver of rights.

4.3 Landlord agrees to abate the Base Rent for the first and second full calendar month of the Lease Term.

ARTICLE V

Increases in Real Estate Taxes and Operating Costs

5.1 Tenant shall pay Tenant’s proportionate share of the amount by which Operating Charges (as defined in Section 5.2) during each calendar year falling entirely or partly within the Lease Term exceed a base amount (the “Operating Charges Base Amount”) equal to the Operating Charges actually incurred during

 

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the Operating Charges Base Year (as defined in Section 1.7 above). For purposes of this Section, Tenant’s proportionate share shall be that percentage which is equal to a fraction, the numerator of which is the number of square feet of rentable area in the Premises, and the denominator of which is the number of square feet of rentable area in the Building excluding the number of square feet of rentable area of basement storage space.

5.2 Operating Charges shall mean the following expenses incurred by Landlord in the ownership and operation of the Building: (a) electricity, water, sewer and other utility charges; (b) insurance premiums; (c) management fees; (d) costs of service and maintenance contracts; (e) maintenance and repair expenses which are deducted by Landlord in computing its federal income tax liability; (f) depreciation for capital expenditures made by Landlord to reduce operating expenses if Landlord reasonably estimates that the annual reduction in operating expenses shall exceed such depreciation; (g) Real Estate Taxes (as defined in Section 5.3); (h) charges for janitorial services; (i) assessments imposed by any association now or hereafter established to maintain common areas and facilities of the Complex, (j) any business, professional and occupational license tax payable by Landlord with respect to the Building; (k) reasonable reserves for replacements, repairs and contingencies; (l) Building engineer salary and employment expenses; and (m) any other expense reasonably incurred by Landlord in maintaining, repairing or operating the Building. Operating Charges shall not include: (1) principal or interest payments on any mortgage, deed of trust or ground lease; (2) leasing commissions; (3) depreciation of the Building or other improvements except as specified above; (4) the costs of special services or utilities separately charged to particular tenants of the Building; (5) expenses for painting, redecorating, space planning, construction or other work which Landlord performs for any tenant premises of the Building; (6) escrow fees, brokerage fees or commissions, loan fees, points, title charges or other payments on or arising with regarding to loans to Landlord or indebtedness secured by the Building, or any costs connected with refinancing of such loans; (7) advertising and marketing costs, tenant concessions and any other costs associated with the leasing or sale of the Building, Land or any portion thereof; (8) Landlord’s income taxes; (9) Landlord’s costs of any service sold to any tenant or occupant of the Building for which Landlord is entitled to be reimbursed as an additional charge or rental over and above the base rent and escalations payable under the lease or occupancy agreement with that tenant or other occupant (including, without limitation, after-hours HVAC costs or over-standard electrical

 

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consumption costs incurred by other tenant or occupants); (10) the initial cost of construction of the Building; (11) salaries or other compensation of any personnel whose salaries are covered by a management fee (except that the Building Engineer salary shall be an Operating Expense and shall not be covered by the management fee); (12) expenses for repairs or replacements to the extent such expenses are covered by and reimbursed to Landlord by virtue of warranties from contractors or suppliers; (13) any amounts paid to any person, firm or corporation related or otherwise affiliated with Landlord or any general partner, officer or director of Landlord or any of its general partners, to the extent same exceeds arms-length competitive prices paid in the Washington, DC metropolitan area for the services or goods provided; (14) costs relating to maintaining Landlord’s existence, either as a corporation, partnership, or other entity, such as trustee’s fees, annual fees, partnership organization or administration expenses, deed recordation expenses, legal and accounting fees (other than with respect to Building operations); (15) costs incurred due to Landlord’s violation of any terms and conditions of this Lease or any other lease relating to the Building; (16) overhead profit increments paid to Landlord’s subsidiaries or affiliates for management or other services on or to the Building or for supplies or other materials to the extent that the cost of the services, supplies, or materials materially exceeds the cost that would have been paid had the services, supplies or materials been provided by unaffiliated parties on a competitive basis; (17) rental and other expenses incurred in leasing air conditioning systems, elevators, or other equipment ordinarily considered to be of a capital nature (excepting equipment used in providing janitorial services, when such equipment is not affixed to the Building); (18) the cost of any item of service or repair to the extent covered by any warranty, guaranty or insurance policy maintained or held by Landlord; (19) any Operating Charges which are payable by any tenant directly to the provider of the service or for which Landlord is entitled to be reimbursed directly by a tenant, or by insurance proceeds; and (20) legal or accounting fees, costs and disbursements for negotiating leases or enforcing the lease obligations of other tenants in the Building.

All Operating Charges shall be “net” only and shall be reduced by the amount of any insurance or other reimbursement, recoupment, payment, discount or allowance received by Landlord.

5.3 Real Estate Taxes shall mean (a) all real estate taxes, including general and special assessments, if any, which are imposed upon Landlord or assessed against the Building and/or the land upon which the Building is located (the “Land”), (b) any

 

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other present or future taxes or governmental charges that are imposed upon Landlord or assessed against the Building or the Land which are in the nature of or in substitution for real estate taxes, including any tax levied on or measured by the rents payable by tenants of the Building, and (c) expenses (including attorneys’ fees) incurred in reviewing or seeking a reduction of real estate taxes.

5.4 If the average occupancy rate for the Building during any calendar year including the Operating Charges Base Year is less than ninety-five percent (95%), or if any tenant is separately paying for the electricity or janitorial services furnished to its premises, then Operating Charges for such calendar year shall be deemed to include all additional expenses, as reasonably estimated by Landlord, which would have been incurred during such calendar year if such average occupancy rate had been ninety-five percent (95%) and if Landlord paid for electricity and janitorial services furnished to such premises. For example, if the average occupancy rate for the Building during a calendar year is eighty percent (80%), and if the janitorial contractor charges are $1.00 per square foot of occupied rentable area per year, and if the Building contains one hundred thousand (100,000) square feet of rentable area, then it would be reasonable for Landlord to estimate that if the Building had been ninety-five percent (95%) occupied during such year, then janitorial charges for such year would have been ninety-five thousand dollars ($95,000.00).

5.5 At the beginning of the Lease Term and at the beginning of each calendar year thereafter, Landlord may submit a statement setting forth the amount by which Operating Charges that Landlord reasonably expects to be incurred during each calendar year exceed the Operating Charges Base Amount and Tenant’s proportionate share of such excess. Tenant shall pay to Landlord on the first day of each month after receipt of such statement, until Tenant’s receipt of any succeeding statement, an amount equal to one-twelfth (1/12) of such share.

5.6 Within approximately one hundred twenty (120) days after the end of each calendar year, Landlord shall submit a statement showing (a) Tenant’s proportionate share of the amount by which Operating Charges incurred during the preceding calendar year exceeded the Operating Charges Base Amount, and (b) the aggregate amount of Tenant’s estimated payments during such year. If such statement indicates that the aggregate amount of such estimated payments exceeds Tenant’s actual liability, then Tenant shall deduct the net overpayment from its next estimated payment(s) pursuant to this Article. If such statement indicates

 

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that Tenant’s actual liability exceeds the aggregate amount of such estimated payments, then Tenant shall pay the amount of such excess. If Tenant does not notify Landlord in writing of any objection to such statement within forty five (45) days after receipt, then Tenant shall be deemed to have waived such objection.

5.7 If the Lease Term commences or expires on a day other than the first day or the last day of a calendar year, respectively, then Tenant’s liability for Operating Charges incurred during such year shall be proportionately reduced.

ARTICLE VI

Use of Premises

6.1 Tenant shall use the Premises solely for general office purposes and for no other use or purpose. Tenant shall not use the Premises for any unlawful purpose or in any manner that in Landlord’s opinion will constitute waste, nuisance or unreasonable annoyance to Landlord or any tenant of the Building. Tenant shall comply with all present and future laws, ordinances, regulations and orders concerning the use, occupancy and condition of the Premises and all machinery, equipment and furnishings therein. If any such law, ordinance, regulation or order requires an occupancy or use permit for the Premises, then Tenant shall obtain and keep current such permit at Tenant’s expense and promptly deliver a copy thereof to Landlord. Use of the Premises is subject to all covenants, conditions and restrictions of record.

6.2 Tenant shall pay before delinquency any business, rent or other tax or fee that is now or hereafter assessed or imposed upon Tenant’s use or occupancy of the Premises, the conduct of Tenant’s business in the Premises or Tenant’s equipment, fixtures, furnishings, inventory or personal property. If any such tax or fee is enacted or altered so that such tax or fee is imposed upon Landlord or so that Landlord is responsible for collection or payment thereof, then Tenant shall pay the amount of such tax or fee.

6.3 Tenant shall not generate, use, store or dispose of any Hazardous Materials in or about the Building. Hazardous Materials shall mean (a) “hazardous wastes,” as defined by the Resource Conservation and Recovery Act of 1976, as amended from time to time, (b) “hazardous substances,” as defined by the

 

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Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended from time to time, (c) “toxic substances,” as defined by the Toxic Substances Control Act, as amended from time to time, (d) “hazardous materials,” as defined by the Hazardous Materials Transportation Act, as amended from time to time, (e) oil or other petroleum products, and (f) any substance whose presence could be detrimental to the Building or hazardous to health or the environment. Notwithstanding the foregoing, Tenant may store in manufacturer provided containers for use in the Premises office supplies customarily found in general offices in such quantities suitable for Tenant’s consumption.

ARTICLE VII

Assignment and Subletting

7.1 Tenant shall not assign this Lease or any of Tenant’s rights or obligations hereunder, or sublet or permit anyone to occupy the Premises or any part thereof, without Landlord’s prior written consent, which consent may be granted or withheld in Landlord’s discretion, which will not be unreasonably withheld. No assignment or transfer of this Lease may be effected by operation of law or otherwise without Landlord’s prior written consent. Any assignment, subletting or occupancy, Landlord’s consent thereto or Landlord’s collection or acceptance of rent from any assignee, subtenant or occupant shall not be construed as a waiver or release of Tenant from liability hereunder. Any assignment, subletting or occupancy, Landlord’s consent thereto or Landlord’s collection or acceptance of rent from any assignee, subtenant or occupant shall not be construed as relieving Tenant or any assignee, subtenant or occupant from the obligation of obtaining Landlord’s prior written consent to any subsequent assignment, subletting or occupancy. Tenant assigns to Landlord any sum due from any assignee, subtenant or occupant of Tenant as security for Tenant’s performance of its obligations pursuant to this Lease. Tenant authorizes each such assignee, subtenant or occupant to pay such sum directly to Landlord if such assignee, subtenant or occupant receives written notice from Landlord specifying that such rent shall be paid directly to Landlord. Landlord’s collection of such rent shall not be construed as an acceptance of such assignee, subtenant or occupant as tenant. All restrictions and obligations imposed pursuant to this Lease on Tenant shall be deemed to extend to any subtenant, assignee or occupant of Tenant, and Tenant shall cause such persons to comply with all such restrictions and obligations. Tenant shall not mortgage this Lease without Landlord’s written consent, which consent may be granted or withheld in Landlord’s sole and absolute discretion. Tenant shall pay the expenses (including

 

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reasonable attorneys’ fees) incurred by Landlord in connection with Tenant’s request for Landlord to give its consent to any assignment, subletting, occupancy or mortgage.

7.2 If Tenant is a partnership, then any dissolution of Tenant or a withdrawal or change, whether voluntary, involuntary or by operation of law, of partners owning a controlling interest in Tenant shall be deemed a voluntary assignment of this Lease. If Tenant is a corporation, then any dissolution, merger, consolidation or other reorganization of Tenant, or any sale or transfer of a controlling interest of its capital stock, shall be deemed a voluntary assignment of this Lease.

7.3 If Tenant wants to assign, sublet or otherwise transfer all or part of the Premises or this Lease, then Tenant shall give Landlord written notice (“Tenant’s Request Notice”) of the identity of the proposed assignee or subtenant and its business, all terms of the proposed assignment or subletting, and the commencement date of the proposed assignment or subletting (the “Proposed Sublease Commencement Date”) and the area proposed to be assigned or sublet (the “Proposed Sublet Space”). Tenant shall also transmit therewith the most recent financial statement or other evidence of financial responsibility of such assignee or subtenant and a certification executed by Tenant and such proposed assignee or subtenant stating whether any premium or other consideration is being paid for the proposed assignment or sublease.

7.4 Landlord shall have the right in its sole and absolute discretion to terminate this Lease with respect to the Proposed Sublet Space by sending Tenant written notice within forty-five (45) days after Landlord’s receipt of Tenant’s Request Notice. If the Proposed Sublet Space does not constitute the entire Premises and Landlord elects to terminate this Lease with respect to the Proposed Sublet Space, then (a) Tenant shall tender the Proposed Sublet Space to Landlord on the Proposed Sublease Commencement Date as if the Proposed Sublease Commencement Date had been originally set forth in this Lease as the expiration date of the Lease Term with respect to the Proposed Sublet Space, and (b) as to all portions of the Premises other than the Proposed Sublet Space, this Lease shall remain in full force and effect except that the additional rent payable pursuant to Article V and the Base Rent shall be reduced proportionately. Tenant shall pay all expenses of construction required to permit the operation of the Proposed Sublet Space separate from the balance of the Premises. If the Proposed Sublet Space constitutes the entire Premises and Landlord elects to terminate this Lease, the (1) Tenant shall tender the Premises to Landlord

 

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on the Proposed Sublease Commencement Date, and (2) the Lease Term shall terminate on the Proposed Sublease Commencement Date, and neither Landlord nor Tenant shall have any further liability for any amounts that otherwise may be due under this Lease. Notwithstanding the foregoing sentence, Tenant shall remain responsible for any Operating Expense adjustments for Operating Expenses accruing up to the Proposed Sublease Commencement Date. In addition, Tenant shall remain liable for any and all costs associated with any damage or destruction to the Premises, normal wear and tear excepted.

7.5 If any sublease, assignment or other transfer (whether by operation of law or otherwise) provides that subtenant, assignee or other transferee is to pay any amount in excess of the rent and other charges due under this Lease, then, whether such excess be in the form of any increased rental, lump sum payment, payment for the sale or lease of fixtures or other leasehold improvements or any other form (and if the applicable space does not constitute the entire Premises, the existence of such excess shall be determined on a prorata basis), Tenant shall pay to Landlord any such excess upon such terms as shall be specified by Landlord and in no event later than ten (10) days after Tenant’s receipt thereof. Landlord shall have the right to inspect Tenant’s books and records relating to any sublease, assignment or other transfer. Any sublease, assignment or other transfer shall be effected on forms supplied or approved by Landlord.

ARTICLE VIII

Maintenance and Repairs

8.1 Tenant shall keep and maintain the Premises and all fixtures and equipment located therein in clean, safe and sanitary condition, shall take good care thereof and make all repairs thereto, shall suffer no waste or injury thereto, and at the expiration or earlier termination of the Lease Term, shall surrender the Premises in the same order and condition in which they were on the Lease Commencement Date, ordinary wear and tear and unavoidable damage by the elements excepted. Except as otherwise provided in Article XVII or as covered by Landlord’s insurance, all injury, breakage and damage to the Premises and to any other part of the Building or the Land caused by any act or omission of any invitee, agent, employee, subtenant, assignee, contractor, client, family member, licensee, customer or guest of Tenant (collectively “Invitees”) or Tenant, shall be repaired by and at Tenant’s expense, except that Landlord shall have the right at Landlord’s option to make any such repair and to charge Tenant for all costs and expenses incurred in connection

 

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therewith. Landlord shall provide and install replacement tubes for building standard fluorescent light fixtures (subject to reimbursement pursuant to Article V); all other bulbs and tubes for the Premises shall be provided and installed at Tenant’s expense.

ARTICLE IX

Alterations

9.1 Tenant agrees to accept the Premises in its AS-IS, WHERE-IS condition. Landlord is under no obligation to make any alterations, additions, improvements or other changes (collectively “Alterations”) in or to the Premises except as otherwise expressly provided in this Lease.

9.2 Tenant shall not make or permit anyone to make any Alteration in or to the Premises or the Building without Landlord’s prior written consent, which consent may be granted or withheld in Landlord’s sole and absolute discretion with respect to structural Alterations and non-structural Alterations which are visible from the exterior of the Premises, and which consent shall not be unreasonably withheld with respect to all other non- structural Alterations. Structural Alterations shall be deemed to include without limitation any Alteration that will or is likely to necessitate any changes, replacements or additions to the electrical, mechanical, plumbing, heating, ventilating or air conditioning systems of the Premises or the Building. Any Alteration made by Tenant shall be made: (a) in a good, workmanlike, first-class and prompt manner; (b) using new materials only; (c) by a contractor and in accordance with plans and specifications approved in writing by Landlord; (d) in accordance with legal requirements and requirements of any insurance company insuring the Building; (e) after obtaining any required consent of the holder of any Mortgage (as defined in Section 21.1); and (f) after obtaining a workmen’s compensation insurance policy approved in writing by Landlord. If any lien (or a petition to establish a lien) is filed in connection with any Alteration, then such lien (or petition) shall be discharged by Tenant at Tenant’s expense within thirty (30) days thereafter by the payment thereof or filing of a bond acceptable to Landlord. Landlord’s consent to the making of an Alteration shall not be deemed to constitute Landlord’s consent to subject its interest in the Premises or the Building to liens which may be filed in connection therewith.

 

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9.3 If any Alteration is made without Landlord’s prior written consent, then Landlord shall have the right at Tenant’s expense to remove and correct such Alteration and restore the Premises and the Building to their condition immediately prior thereto or to require Tenant to do the same. All Alterations to the Premises or the Building made by either party shall immediately become Landlord’s property and shall remain upon and be surrendered with the Premises at the expiration or earlier termination of the Lease Term; provided, however, that if Tenant is not in default under this Lease, then Tenant shall have the right to remove, prior to the expiration or earlier termination of the Lease Term, all movable furniture, furnishings and equipment installed in the Premises solely at Tenant’s expense, and except that Tenant shall be required to remove all Alterations to the Premises or the Building which Landlord designates in writing for removal. Movable furniture, furnishings and equipment shall be deemed to exclude any item which would normally be removed from the Premises with the assistance of any tool or machinery other than a dolly. Landlord shall have the right to repair at Tenant’s expense all damage to the Premises or the Building caused by such removal or to require Tenant to do the same. If any such furniture, furnishing or equipment is not removed by Tenant prior to the expiration or earlier termination of the Lease Term, then the same shall become Landlord’s property and shall be surrendered with the Premises as a part thereof; provided, however, that Landlord shall have the right to remove from the Premises at Tenant’s expense such furniture, furnishing or equipment and any Alteration which Landlord designates in writing for removal.

ARTICLE X

Signs

10.1 Landlord will list Tenant’s name in the Building directory, if any, and provide building standard signage near one suite entry door. Tenant shall not paint, affix or otherwise display on any part of the exterior or interior of the Building any other sign, advertisement or notice. If any such item that has not been approved by Landlord is so displayed, then Landlord shall have the right to remove such item at Tenant’s expense or to require Tenant to do the same.

ARTICLE XI

Security Deposit

11.1 Concurrently with Tenant’s execution of this Lease, Tenant shall deposit with Landlord the Security Deposit. Landlord shall not be required to pay interest on the Security Deposit or to maintain the Security Deposit in a separate

 

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account. Within three (3) days after written notice of Landlord’s use of the Security Deposit, Tenant shall deposit with Landlord cash in an amount sufficient to restore the Security Deposit to its prior amount. Within approximately sixty (60) days after the later of (a) the expiration or earlier termination of the Lease Term, or (b) Tenant’s vacating the Premises, Landlord shall return the Security Deposit less such portion thereof as Landlord may have used to satisfy Tenant’s obligations. If Landlord transfers the Security Deposit to a transferee of the Building or Landlord’s interest therein, then such transferee (and not Landlord) shall be liable for its return. The holder of any Mortgage shall not be liable for the return of the Security Deposit unless such holder actually receives the Security Deposit.

ARTICLE XII

Holding Over

12.1 Tenant acknowledges that it is extremely important that Landlord have substantial advance notice of the date on which Tenant will vacate the Premises, because Landlord will (a) require an extensive period to loc