Sample Contracts - MD-Annapolis Junction-2720 Technology Drive Lease - NBP 220 LLC and Titan Corp.

AGREEMENT OF LEASE

THIS AGREEMENT OF LEASE (this “Lease”) made this 31st day of March, 2003 (the “Effective Date”) by and betweenNBP 220, LLC (the “Landlord”) and THE TITAN CORPORATION, a Delaware corporation (the “Tenant”), witnesseth that the parties hereby agree as follows:

W I T N E S S E T H:

THAT FOR AND IN CONSIDERATION of the mutual covenants and agreements herein contained, the parties hereto do hereby covenant and agree as follows:

1. Definitions and Attachments.

1.1 Certain Defined Terms.

1.1.1 “Building” means the Class A office building to be known as “220 National Business Park” located at 2720 Technology Drive, Annapolis Junction, Maryland 20701, which is located within Anne Arundel County, Maryland.

1.1.2 “Premises” means the entire Building.

1.1.3 “Rentable Area of the Building” or “Rentable Area of the Premises” means approximately 156,730 rentable square feet, subject to adjustment in accordance with BOMA standards (ANSI Z65.1-1996) as provided in Section 2 hereof.

1.1.4 “Initial Term” means a period of ten (10) years plus the part of a month mentioned in Section 3.1, commencing and ending as provided in Section 3.1.

1.1.5 “Renewal Term” means each of three (3) additional periods of five (5) years each, commencing and ending as provided in Section 3.2.

1.1.6 “Annual Base Rent” means the amount set forth on the following schedule multiplied by the Rentable Area of the Premises:

Annual Base Rent

Lease Year Per Rentable Square Foot

1 $25.50

2 $26.27

3 $27.05

4 $27.86

5 $28.70

6 $29.56

7 $30.45

8 $31.36

9 $32.30

10 $33.27

1.1.7 “Target Date for Delivery of Possession” means June 1, 2004.

1.1.8 “Advance Rental” means the sum of $333,051.25. See Section 4.2.

1.1.9 “Security Deposit” means the sum of __NONE__, subject to the provisions of Section 4.1.

1.1.10 “Tenant Notice Address” means the address set forth in Section 33.

1.1.11 “Base Year Building Expenses” shall mean the actual Building Expenses per rentable square foot incurred by Landlord for the 2005 calendar year.

1.1.12 “Base Year Taxes” shall mean the actual Taxes incurred by Landlord per rentable square foot for the 2005 calendar year.

1.1.13 “Allowance” means the product of $22.00 multiplied by the Rentable Area of the Premises. “Amortized Amount” means the product of $10.00 multiplied by the Rentable Area of the Premises. See Section 35.

1.1.14 “Broker” means Miller Corporate Real Estate and Insignia/ESG.

1.1.15 “Tenant’s Share” means a fraction, the numerator of which is the Rentable Area of the Premises and the denominator is the Rentable Area of the Building. As of the Effective Date, Tenant’s Share is 100%.

1.2. Additional Defined Terms.

The following additional terms are defined in the places in this Lease noted below:

Term Section

“ADA” 47

“Applicable Laws” 7

“Approved Plans and Specifications” 35

“Building Expenses” 6.2.2

“Commencement Date” 3.1

“Common Areas” 6.2.4

“Cost of Building Expenses Per Square Foot” 6.4.1

“Cost of Taxes Per Square Foot” 6.3.1

“Hazardous Material” 46

“HVAC” 23

“Landlord’s Notice” 3.2

“Lease Year” 6.2.5

“Mortgagee” 31

“Prevailing Market Rate” 3.2

“Property” 6.2.1

“Successor’ 32

“Taxes” 6.2.3

“Tenant Improvements” 35

“Term” 3.3

1.3. Attachments.

The following documents are attached hereto, and such documents, as well as all drawings and documents prepared pursuant thereto, shall be deemed to be a part hereof:

Exhibit “A” - Legal Description of Property

Exhibit “A-2” - Design Drawings

Exhibit “B” - Rules and Regulations

Exhibit “C” - Schedule of Landlord’s Work

Exhibit “C-1” - Interior Construction and Renovation Contractor Requirements

Exhibit “D” - Plat of Signage

Exhibit “E” - Suburban Office Building Guidelines

Exhibit “F” - Commencement Date Agreement

Exhibit “G” - Intentionally Left Blank

Exhibit “H” - Intentionally Left Blank

Exhibit “I” - Specifications for HVAC, Electrical Capacity and Floor Load

Exhibit “J” - Janitorial Specifications

Exhibit “K” - Subordination, Non-Disturbance and Attornment Agreement

Exhibit “L” - Modifications to Base Building

2. Demise and Measurement of Premises. Landlord hereby leases unto Tenant, and Tenant does hereby rent from Landlord the Premises that will be constructed in accordance with the provisions of Section 35 of this Lease. In addition thereto, Tenant shall have the right to use, on a non-exclusive basis, and in common with the other tenants of the Building, if any, the Common Areas of the Building (as that term is defined in Section 6.2.4 hereof). The Premises and the Building shall be measured in accordance with BOMA standards (ANSI Z65.1- 1996), utilizing the “Gross Building Area” computation. At Tenant’s election, the Rentable Area of the Building as set forth in Section 1.1.3 shall be subject to confirmation before the Rent Commencement Date by Tenant’s architect, at Tenant’s sole cost. In the event the Rentable Area of the Building figure determined by Tenant’s architect differs by no more than 0.5% (higher or lower) from the Rentable Area of the Building set forth in Section 1.1.3 , then the Rentable Area of the Building set forth in Section 1.1.3 shall be controlling. In the event the Rentable Area of the Building figure determined by Tenant’s architect differs by more than 0.5% (higher or lower) from the Rentable Area of the Building set forth in Section 1.1.3, then Landlord and Tenant (in coordination with their respective architects) shall endeavor in good faith to resolve the discrepancy, and in the event they are not able to resolve such discrepancy then Landlord and Tenant shall jointly appoint an independent architect to resolve such discrepancy within thirty (30) days following a request therefor by Landlord or Tenant and the determination of such independent architect shall be binding on both Landlord and Tenant. During any such dispute, Tenant shall pay Annual Base Rent to Landlord based on the Rentable Area of the Building set forth in Section 1.1.3. If such independent architect determines that the rentable area differs by no more than 0.5% from the Rentable Area of the Building set forth in Section 1.1.3, then the fees of such independent architect shall be borne by Tenant, otherwise such fees shall be borne by Landlord. Promptly after determination of the Rentable Area of the Building in accordance with this Section 2, Landlord and Tenant shall execute an amendment to this Lease confirming such determination and with a proportionate adjustment to Annual Base Rent, additional rent and any prior payments which have been made by Tenant. In no event shall Tenant be required to pay Annual Base Rent based on more than 157,514 rentable square feet regardless of the actual measurement of the rentable square footage of the Premises. Landlord shall have no right to remeasure the Premises during the Term. In the event Tenant does not elect to verify the Rentable Area of the Building pursuant to this Section 2, then the Rentable Area of the Building shall be as set forth in Section 1.1.3.

3. Term.

3.1 Commencement Date and Term. All of the provisions of this Lease shall be in full force and effect from and after the Effective Date. As used in this Lease, the term “Commencement Date”, as advanced or postponed pursuant to the terms hereof, shall be defined as the date of Delivery of Possession of Landlord Items (as defined in Section 35) and, subject to Section 35.1 hereof, the term “Rent Commencement Date” shall be the date which is one hundred fifty (150) days following that date of Delivery of Possession of Landlord’s Items (as defined in Section 35). Notwithstanding the foregoing to the contrary, if Tenant elects for Landlord to construct the Tenant’s Work pursuant to the terms of Section 35 below, the Commencement Date and the Rent Commencement Date shall be the date of Delivery of Possession of the Premises with Landlord’s Work substantially completed. The first Lease Year shall commence on the Commencement Date and shall end on the date which is last day of the calendar month which is twelve (12) full months after the Rent Commencement Date. Within fifteen (15) days after receipt of a written request from Landlord, Tenant shall execute and deliver the Commencement Date Agreement in substantially the form attached hereto as Exhibit “F”.

3.2 Option to Extend Lease Term. Provided Tenant is not in default of any term, covenant or condition of this Lease beyond any applicable notice and cure period, Tenant shall have the option to extend the Initial Term of this Lease for the entire Premises for three (3) additional periods of five (5) years each (the “Renewal Term”) to commence immediately upon the expiration of the Initial Term, the First Renewal Term and the Second Renewal Term, as applicable.

Tenant’s rental of the Premises during the First Renewal Term, the Second Renewal Term and the Third Renewal Term, as applicable, shall be upon the same terms, covenants and conditions contained in this Lease, except that Tenant shall pay to Landlord as Annual Base Rent that amount equal to the “Prevailing Market Rate” for the Premises for the First Renewal Term, the Second Renewal Term and the Third Renewal Term, as applicable, as hereinafter defined (including annual adjustments). For purposes of this Section 3.2, the term “Prevailing Market Rate” shall mean the then prevailing market rate being charged for renewals of comparable space in comparable office buildings within a ten (10) mile radius of the Premises, with consideration given for all factors appropriately considered in determining fair market economics of a similar transaction, including, but not limited to, construction allowances, commissions (or lack thereof), free rent, the creditworthiness of Tenant and other concessions or premiums, costs being saved and downtime for vacancy. In order to exercise its option granted herein, Tenant shall notify Landlord in writing of its intent to renew not less than three hundred sixty-five (365) days prior to the expiration of the Initial Term, the First Renewal Term or the Second Renewal Term, as applicable. Within thirty (30) days following the exercise by Tenant of its option to extend the Lease for the First Renewal Term, the Second Renewal Term and the Third Renewal Term, as applicable, Landlord shall notify Tenant in writing of its determination of the Prevailing Market Rate for the First Renewal Term, the Second Renewal Term and the Third Renewal Term, as applicable, as reasonably determined by Landlord (“Landlord’s Notice”). Within ten (10) business days after receipt of Landlord’s Notice, Tenant shall notify Landlord in writing of Tenant’s acceptance or rejection of such rate. If Tenant accepts the proposed Prevailing Market Rate by written notice to Landlord, Landlord and Tenant shall enter into an amendment to this Lease acknowledging such renewal and setting forth any terms at variance with the terms of this Lease. If, within the ten (10) day period, Tenant does not accept the proposed Prevailing Market Rate as determined by Landlord for the First Renewal Term, the Second Renewal Term and the Third Renewal Term, as applicable, then within twenty (20) days thereafter, Landlord and Tenant shall meet at a mutually acceptable time and place and shall use their reasonable efforts to agree upon the Prevailing Market Rate. If Landlord and Tenant shall fail to agree upon such Prevailing Market Rate for either the First Renewal Term, the Second Renewal Term or the Third Renewal Term, within the twenty (20) day period, Landlord and Tenant shall each appoint an independent commercial leasing broker licensed in the Maryland area within the next ten (10) days (the “Brokers”). Such Brokers shall deliver their respective estimates of the Prevailing Market Rate within ten (10) days after being appointed. If the estimates of the Prevailing Market Rate as quoted by the Brokers are within ten percent (10%) of each other, the Prevailing Market Rate shall be deemed to be the average of the estimates presented by the Brokers. If the estimates of the Prevailing Market Rate as quoted by the Brokers differ by more than ten percent (10%), then Landlord and Tenant shall jointly appoint a third independent commercial leasing broker licensed in the Maryland area within ten (10) days after the receipt of the initial brokers’ estimates (the “Third Broker”) who shall deliver its estimate of the Prevailing Market Rate within ten (10) days after being appointed and such estimate shall be deemed to be the Prevailing Market Rate. Tenant shall have the right to notify Landlord within ten (10) business days after receipt of the estimate of the Prevailing Market Rate (whether as resulting from the average of the Brokers or from the Third Broker, as applicable), that it rejects such Prevailing Market Rate and in such event, Tenant’s option to extend the Lease for the First Renewal Term, the Second Renewal Term or the Third Renewal Term, as applicable, shall be void and inoperable. If Tenant fails to exercise its right to reject the Prevailing Market Rate, then Landlord and Tenant shall enter into an amendment to this Lease acknowledging such renewal and setting forth any terms at variance with the terms of this Lease. Landlord and Tenant shall each pay the fee of the broker designated by them originally and shall split the fees of the Third Broker. If Tenant shall fail to deliver the requisite notice exercising its option to extend by the date prescribed above, then Tenant’s option to extend the Term for the First Renewal Term, the Second Renewal Term and the Third Renewal Term, as applicable, shall be void and inoperable. The Second Renewal Term and the Third Renewal Term shall terminate if Tenant does not elect to renew the Lease for the First Renewal Term. The Third Renewal Term shall terminate if Tenant does not elect to renew the Lease for the Second Renewal Term.

3.3 Definition of “Term”. As used herein, the word “Term” shall refer to the Initial Term the First Renewal Term, the Second Renewal Term and the Third Renewal Term, if applicable.

4. Security Deposit and Advance Rent.

4.1 Security Deposit. Simultaneously with the execution of this Lease, Tenant shall not be required to pay a Security Deposit in accordance with the terms of this Lease. However, if prior to the Rent Commencement Date, Tenant’s credit rating falls below a “BB-” as determined by Standard & Poor’s credit rating agency or Moody’s credit rating agency, Tenant shall pay to Landlord a Security Deposit in the amount of $1,998,307.50 by Letter of Credit (as further described below) as security for the performance by Tenant of all obligations imposed on Tenant hereunder. Tenant shall deliver to Landlord a statement of its credit rating on each January 15, April 15, July 15, and October 15^th occurring after the Effective Date and prior to the Rent Commencement Date; provided, however, that the provisions of the immediately proceeding sentence shall be effective at anytime prior to the Rent Commencement Date and shall not be limited to the reporting periods aforementioned. Tenant shall deliver the Letter of Credit within fifteen (15) days after written request from Landlord. Failure to deliver such Letter of Credit shall be an automatic Event of Default under the terms of the Lease, without further notice or cure periods afforded to Tenant.

In such event, Tenant shall deliver to Landlord an unconditional and irrevocable Letter of Credit issued by and drawable upon Comerica Bank in San Diego, California or another banking institution reasonably approved by Landlord in the amount of $1,998,307.50 to be held by Landlord as a guaranty for the payment and performance by Tenant of all covenants and obligations of Tenant as set forth in this Lease. The Letter of Credit shall contain terms whereby it can be drawn on by Landlord by sending the original Letter of Credit by overnight delivery, in the case of an institution which is not located in the Baltimore-Washington metropolitan area or on sight if located in the Baltimore-Washington metropolitan area on any date during the Term of this Lease on which issuer shall receive from Landlord a certification signed by Landlord stating that there is a Event of Default by Tenant under the terms of this Lease. Landlord shall have the right to make such certification immediately upon any Event of Default by Tenant hereunder (as defined in Section 21 hereof) and to apply said sum against all amounts then due and owing by Tenant hereunder and/or against sums required to be and actually expended by Landlord hereunder to correct existing defaults by Tenant. The Letter of Credit shall also provide that Landlord shall have the right to draw upon the Letter of Credit, in full or in part. Any balance left of the sum received from drawing on the Letter of Credit, after the correction of defaults by Tenant and/or the payment of amounts due by Tenant, shall be credited against the next Rent payment(s) due to Landlord. In the event Landlord shall draw on the Letter of Credit provided by Tenant, all as set forth herein, Tenant shall replace same no later than thirty (30) days after the date of such drawing, and if same is not replaced, it shall constitute an Event of Default under the terms of this Lease and Landlord shall have the benefit of all remedies permitted pursuant to the terms of this Lease and the laws of the State of Maryland.

Subject to the provisions of Section 4.1.1 below, Tenant acknowledges and agrees that it shall keep the Letter of Credit in full force and effect throughout the Term of this Lease. In the event the term of the Letter of Credit is not coterminous with the Term of this Lease, then not more than forty-five (45) days prior to any expiration date of the Letter of Credit, Tenant shall provide Landlord with the appropriate documentation that said Letter of Credit has been extended and provide Landlord with the new expiration date of same. Should Tenant fail to provide Landlord with such documentation on or before the expiration date of the Letter of Credit, Landlord shall have the right to draw on the entire amount of said Letter of Credit and hold it without interest for the benefit of Landlord as security for the faithful performance of the Lease until the Letter of Credit is reinstated or the Term of the Lease expires. If the Letter of Credit is not reinstated, the amount drawn by Landlord shall be returned to Tenant, less all costs incurred by Landlord in correcting or satisfying any Event of Default under this Lease within thirty (30) days after the expiration or earlier termination of the Term.

No right or remedy available to Landlord as provided in this Section 4.1 shall preclude or extinguish any other right or remedy to which Landlord may be entitled.

Notwithstanding the foregoing, if the Letter of Credit is required and Tenant then receives a rating of “BB” or higher by Moody’s for twelve (12) consecutive months, then Landlord shall return the Letter of Credit to Tenant and Tenant shall have no further obligation to pay a Security Deposit during the Term.

4.1.1 Transfer. Upon a sale of the Land and/or the Building or a leasing of the Building, or any financing of Landlord’s interest therein, Landlord shall have the right to transfer any cash Security Deposit or the Letter of Credit, as applicable, to the vendee, lessee or lender, provided such vendee, lessee or lender assumes Landlord’s obligations hereunder with respect to the cash Security Deposit or the Letter of Credit, as applicable. With respect to the Letter of Credit, within ten (10) business days after notice of such sale, leasing or financing, Landlord (with Tenant’s cooperation), at its sole cost, shall arrange for the transfer (by amendment) of the Letter of Credit to the new landlord or the lender, or have the Letter of Credit reissued in the name of the new landlord or the lender. To the extent so transferred, Tenant shall look solely to the new landlord or lender for the return of such cash Security Deposit or Letter of Credit and the provisions hereof shall apply to every transfer or assignment made of the Security Deposit to a new landlord.

4.1.2 Reduction.

(a) Provided no uncured Event of Default shall then exist, then on the first day of each Lease Year, commencing with the first day of the sixth (6^th) Lease Year, and continuing annually thereafter on the first day of each subsequent Lease Year in which Tenant qualifies for reduction (each such anniversary date, a “Reduction Date”), Tenant shall have the right to reduce the Security Deposit (a “Reduction”) to the amount set forth in the following schedule (the “Reduction Schedule”):

Reduction Date Amount

First Day of Lease Year #6 $1,665,256.25

First Day of Lease Year #7 $1,332,205.00

First Day of Lease Year #8 $ 999,153.75

First Day of Lease Year #9 $ 666,102.50

First Day of Lease Year #10 $ 333,051.25

(b) Provided Tenant qualifies as of any such Reduction Date, such Reduction shall be effectuated by Tenant’s delivery of either (i) a replacement letter of credit for the applicable lesser amount, which replacement letter of credit may (A) include an endorsement that provides that such replacement Letter of Credit shall be effective only upon Landlord’s return of the Letter of Credit being replaced or Landlord’s written consent to cancellation of the letter of credit being replaced, or (B) be delivered pursuant to an escrow arrangement otherwise reasonably approved by Landlord and Tenant, or (ii) at least ten (10) business days prior to the effective date of such Reduction, a written amendment to the Letter of Credit which has the effect of reducing the amount of the Letter of Credit to the lesser amount determined pursuant to this Section as of the applicable Reduction Date.

(c) If Tenant does not qualify for a Reduction as of any applicable Reduction Date, but Tenant subsequently does qualify for such Reduction as of a later Reduction Date, then Tenant shall be permitted to “catch up” all prior foregone Reductions as of the applicable Reduction Date. (For example, if Tenant had never previously qualified for a Reduction, but did so effective as of the Reduction Date coinciding with the first day of Lease Year #8, then the Security Deposit would be reduced from $1,998,307.50 to $999,153.75 as of such Reduction Date.)

4.2 Advance Rent. Upon execution of this Lease, Tenant shall pay Landlord the Advance Rent to be held as advance rent and security and which Landlord shall be entitled to retain, without limitation of other remedies, for any defaults of this Lease by Tenant occurring prior to the commencement of the Term. If no such defaults occur, the Advance Rent shall be applied by Landlord against first installments of Annual Base Rent payable by Tenant hereunder.

5. Use. Tenant covenants that it shall use and occupy the Premises during the Term of this Lease solely for general office purposes and uses incidental and ancillary thereto that are consistent with the operation of a Class A office building which uses may include, without limitation, data center, SCIF, training, employee/building invitee cafeteria/in-house food service, operations center, coffee and vending uses, Tenant company store, deli, light assembly for modification and testing of computers and related equipment, child care for employees, exercise facility and conference center, all in accordance with applicable zoning regulations.

6. Rent.

6.1 Annual Base Rent. As rent for the Premises during each year of the Term, commencing on the Rent Commencement Date, Tenant shall pay to Landlord an Annual Base Rent, in equal monthly installments, in advance on the first day of each calendar month during the Term, and without deduction, setoff or demand in accordance with the schedule set forth in Section 1.1.6 above. In addition, if the Rent Commencement Date occurs on a day other than the first day of a calendar month, Tenant shall pay to Landlord upon the Rent Commencement Date, a sum equaling that percentage of the monthly rent installment which equals the percentage of such calendar month falling after the Rent Commencement Date.

Notwithstanding the foregoing, Tenant shall have the right to abate a portion of the Annual Base Rent up to a maximum amount of either (i) $333,051.25 per month over the first three (3) months of the Term, computed as ($25.50 x 156,730)/12, or (ii)$166,525.63 per month over the first six (6) months of the Term, computed as [($25.50 x 156,730)/12] divided by 2. Tenant shall notify Landlord in writing on or before January 1, 2004, of the amount of Annual Base Rent, if any, which Tenant desires to abate and over what period of time. If Tenant fails to notify Landlord of its election to abate Annual Base Rent on or before January 1, 2004, Tenant shall be deemed to have waived its right to abate Annual Base Rent. If Tenant elects option (i), the Annual Base Rent for the 117 months remaining in the Initial Term shall be increased monthly by an amount equal to the quotient of the amount abated divided by 117 months; and if Tenant elects option (ii), the Annual Base Rent for the 114 months remaining in the Initial Term shall be increased monthly by an amount equal to the quotient of the amount abated divided by 114 months. By way of example, but without limitation, if Tenant elects to abate $333,051.25 per monthover the first three (3) months of the Initial Term, Annual Base Rent shall increase monthly commencing on the 4^th month and through the balance of the Initial Term in an amount equal to $2,846.59, computed as $333,051.25 divided by 117. If Tenant elects to abate Annual Base Rent pursuant hereto, (i) within fifteen (15) days after request from Landlord, the parties shall enter into an amendment to the Lease which sets forth the revised schedule of Annual Base Rent, and (ii) in no event shall Tenant’s obligation to pay for electrical service during such abatement period be abated in any regard.

6.2 Definitions. For the purposes hereof, the following definitions shall apply:

6.2.1 “Property” shall mean the Building, the land upon which same is situated and all fixtures and equipment thereon or therein, and all commonly owned or shared appurtenances, including but not limited to, parking areas, walkways, landscaping and utilities located on the Premises, which legal description is attached hereto as Exhibit “A”.

6.2.2 “Building Expenses” shall be all those expenses paid by Landlord in connection with the owning, maintaining, operating and repairing of the Property or any part thereof, in a manner deemed reasonable and appropriate by Landlord and shall include, except as otherwise expressly excluded from Building Expenses, without limitation, the following:

6.2.2.1 All costs and expenses of operating, repairing, lighting, cleaning, and insuring (including liability for personal injury, death and property damage and workers’ compensation insurance covering personnel) the Property or any part thereof, as well as all costs incurred in removing snow, ice and debris therefrom and of policing and regulating traffic with respect thereto, and depreciation of all machinery and equipment used therein or thereon, replacing or repairing of pavement, parking areas, curbs, walkways, drainage, lighting facilities, landscaping (including replanting and replacing flowers and other planting);

6.2.2.2 Electricity, steam and fuel used in lighting, heating, ventilating and air conditioning and all costs, charges, and expenses incurred by Landlord in connection with any change of any company providing electricity service, including, without limitation, maintenance, repair, installation and service costs associated therewith;

6.2.2.3 Maintenance and repair of mechanical and electrical equipment including heating, ventilating and air conditioning equipment;

6.2.2.4 Window cleaning and janitor service, including equipment, uniforms, and supplies and sundries;

6.2.2.5 Maintenance of elevators, stairways, rest rooms, lobbies, hallways and other Common Areas;

6.2.2.6 Repainting and redecoration of all Common Areas;

6.2.2.7 Repair and maintenance of the parking areas, including without limitation, the resurfacing and striping of said areas;

6.2.2.8 Sales or use taxes on supplies or services;

6.2.2.9 Management fees (in an amount not to exceed two and one-half percent (2.5%) of gross rents collected from the Property during the Initial Term), wages, salaries and compensation of all persons engaged directly in the maintenance, operation or repair of the Property and the provision of amenities to all tenants in the Property (including Landlord’s share of all payroll taxes and the cost of an on-site or near-site office and segregated storage area for Landlord’s parts, tools and supplies);

6.2.2.10 Legal fees (but only to the extent they are incurred in connection with an expense which is includable in Building Expenses) and accounting and engineering fees and expenses reasonably necessary for Landlord to render required services pursuant to this Lease, except for fees and expenses related to disputes with tenants or which are a result of and/or are based on Landlord’s negligence or other tortious conduct;

6.2.2.11 Costs and expenses that may result from compliance with any Applicable Laws that were not applicable at the time the Premises were originally constructed; and

6.2.2.12 All other expenses which under generally accepted accounting principles would be considered as an expense of maintaining, operating, or repairing the Property. Notwithstanding the foregoing, all expenses (whether or not such expenses are enumerated on items 1 through 11 of this Section 6.2.2) which would be considered capital in nature under generally accepted accounting principles shall be included in Building Expenses in any Lease Year only if it (1) actually results in savings in such year (as for example, expenditures for a labor-saving improvement) in which case the amount included in Building Expenses shall not exceed the amount of actual savings from such improvement in the same year and/or (2) is made in compliance with Applicable Laws not in effect as of the Delivery of Possession of Landlord’s Items. Such capital improvements shall be amortized on a straight-line basis over the useful life of the improvement being amortized.

6.2.3 “Taxes” shall mean all real property taxes including currently due installments of assessments, sewer rents, ad valorem charges, water rates, rents and charges, front foot benefit charges, and all other governmental impositions in the nature of any of the foregoing. Excluded from Taxes are (i) federal, state or local income taxes, (ii) franchise, corporation, income, receipts, revenue, net profits, gift, transfer, excise, capital stock, estate or inheritance taxes, (iii) personal property taxes of Tenant, and (iv) penalties or interest charged for late payment of Taxes. If at any time during the Term the method of taxation prevailing at the commencement of the Term shall be altered so as to cause the whole or any part of the items listed in the first sentence of this subparagraph to be levied, assessed or imposed, wholly or partly as a capital levy, or otherwise, on the rents received from the Building, wholly or partly in lieu of imposition of or in addition to the increase of taxes in the nature of real estate taxes issued against the Property, then the charge to Landlord resulting from such altered additional method of taxation shall be deemed to be within the definition of “Taxes,”provided that any tax, assessment, levy, imposition or charge imposed on income from the Premises shall be calculated as if the Premises were the only asset of Landlord.

6.2.4 “Common Areas” shall mean those areas and facilities which may be from time to time furnished to the Building by Landlord for the non-exclusive general common use of tenants and other occupants of the Building, their officers, employees, and invitees, including (without limitation) the hallways, stairs, parking facilities, sidewalks, exterior elements, washrooms, and elevators. The foregoing notwithstanding, during any period in which Tenant is leasing (A) 100% of the Building, Tenant shall have the exclusive right to use the interior Common Areas, and priority usage of the exterior Common Areas, and (B) 100% of any floor of the Building, Tenant shall have the exclusive right to use the interior Common Areas on such Floor. Notwithstanding any other provision in this Lease to the contrary, during any period in which Tenant is leasing 100% of the Building, Landlord shall not take any action that will materially and adversely diminish Tenant’s ability to use the Common Areas (other than repairs or other obligations which are Landlord’s responsibility under the terms of Section 11.2 of this Lease) without first obtaining Tenant’s prior approval (which approval shall not be unreasonably withheld, conditioned or delayed and shall not be required in the event of an emergency). Without limiting the foregoing, if, with Tenant’s approval, Tenant’s use of the Common Areas (including, without limitation, the parking areas) is temporarily restricted, Landlord shall use all reasonable efforts to minimize the disturbance to Tenant and the operation of Tenant’s business and to maintain the confidential nature of Tenant’s business.

6.2.5 “Lease Year” shall mean for the first Lease Year that period which shall commence on the Commencement Date and shall end on the date which is last day of the calendar month which is twelve (12) full months after the Rent Commencement Date and each succeeding twelve (12) month period thereafter up to the end of the Term.

6.2.6 Building Expenses Exclusions. Notwithstanding any other provision of this Lease and in addition to the restrictions on Building Expenses set forth in Section 6.2.2 hereof, the following costs and expenses shall be excluded from Building Expenses:

(1) Costs incurred in connection with the construction of the Landlord’s Items or Tenant’s Work if constructed by Landlord;

(2) Costs of correcting defects in the Landlord’s Items, or the initial design, construction, reconstruction or renovation of the Building or the parking lot, or equipment therein, or any tenant improvements;

(3) Costs, including permit, license and inspection costs, associated with alterations or improvements of the premises of other tenants or occupants of the Building or vacant retail space in the Building or incurred in renovating or otherwise improving, decorating, painting or redecorating vacant space for tenants or other occupants of the Building;

(4) Non-cash items such as depreciation, amortization, reserves, bad debt losses and reserves therefor, or other non-cash expenses, except for amortization of personal property used in the ordinary course of operating and maintaining the Building and the Land and the improvements thereon;

(5) Interest, points, fees and principal payments on mortgages and other debt costs, if any, or amortization on any mortgage or mortgages or any other debt instrument encumbering the Building;

(6) Payments pursuant to any ground lease or master space lease;

(7) Expenses directly resulting from the breach of this Lease by Landlord, or the negligence of Landlord, its agents, contractors or employees, or other acts or omissions of tenants other than Tenant;

(8) Costs for which Landlord is entitled to be reimbursed by its insurance carrier, any tenant’s carrier, any tenant, any warrantor or any other third party;

(9) Any bad debt loss, rent loss, or legal fees incurred in collecting rent or other obligations from Building tenants;

(10) The expense of extraordinary services provided to other tenants of the Building or services to which Tenant is not entitled or costs incurred by Landlord in respect of breaches of leases or other agreements relating to the Building;

(11) Costs associated with the operation of the business of the person or entity that constitutes Landlord, as distinguished from the costs of operation of the Building, including accounting and legal matters, costs of defending any lawsuits with any prospective or actual purchaser, ground lessor or mortgagee, costs of selling, syndicating, financing, mortgaging or hypothecating any of Landlord’s interest in the Building, costs of any disputes between Landlord and its employees, disputes of Landlord with Building management, and outside fees paid in connection with disputes with other tenants;

(12) The wages of any employee of Landlord who does not devote substantially all of his or her time to the Building or common areas of the Building, except to the extent such wages and benefits are reasonably, properly and equitably allocable to time spent by such employee in directly servicing the Building or Land;

(13) Fees for services rendered by an affiliate of Landlord to the extent such fees exceed the market rate payable for comparable services if rendered by unrelated third parties of comparable quality, except as pre-approved by Tenant and except that management fees shall be included in Building Expenses to the extent provided in Section 6.2.2.9;

(14) Any improvements that under normal accounting rules should be treated as capital improvements, except as expressly permitted by Section 6.2.2.12;

(15) Fines, penalties, late payment charges and interest arising from the acts or inaction of Landlord or failure timely to make tax and/or other payments, except for such fines, penalties, late payment charges and interest incurred after Tenant has failed to pay its share of Taxes pursuant to Section 6.3;

(16) Capital improvements for the restoration of all or any portion of the Building after the occurrence of a casualty;

(17) Legal fees, court costs and litigation related fees, except as expressly permitted by Section 6.2.2.10;

(18) Costs of remediation or cleanup of any Hazardous Materials near, in, on or under the Building or the Land which are the responsibility of Landlord pursuant to Section 46 below;

(19) Any Building Expense attributable to any health club or other revenue generating facility or amenity (if any) or parking structure;

(20) Costs of repairs or replacements caused by the exercise of any right of condemnation or eminent domain by any public or quasi-public authority;

(21) Taxes other than Taxes described in Section 6.2.3 and other than sales and use taxes on items the cost of which is properly included in Building Expenses;

(22) Salaries and other compensation paid to executive employees above the grade of building manager (including profit sharing, bonuses and other employee benefit plans);

(23) Costs of tools and equipment in excess of $3,000 in the aggregate per annum used in the repair and maintenance of the Building;

(24) Rent, imputed rent, or expenses in lieu of rent for Landlord’s on-site or near-site management office or any other offices or other spaces in the Building used by Landlord or any affiliate of Landlord;

(25) Costs and expenses of utilities directly metered or submetered to other tenants of the Building, if any, or otherwise payable separately by such tenants;

(26) General overhead and administrative and accounting expenses, except to the extent reasonably and properly directly allocable to the operation of the Building;

(27) Assessments to the extent paid in fewer than the maximum permitted number of installments;

(28) Costs associated with any concessions or incentives granted to other tenants in the Building, if any (such as moving expense allowances or reimbursements);

(29) Costs and expenses of janitorial or other services payable separately by other tenants of the Building, if any;

(30) Rental for items which, if purchased rather than rented, would constitute a capital improvement specifically excluded by clause (14);

(31) Marketing costs including leasing commissions, space planners’ fees, attorneys’ fees, advertising expenses, expenses incurred in connection with the negotiation and preparation of proposals, deal memos, letters of intent, leases, subleases and/or assignments, space planning costs and other costs and expenses incurred in connection with lease, sublease and/or assignment negotiations and transactions with present or prospective tenants or other occupants of the Building;

(32) Costs of acquiring any sculpture, paintings or other artwork;

(33) Costs associated with any property other than the Building or the Land, or the improvements thereon, except for those costs incurred by Landlord pursuant to the Association Declaration, but only to the extent such costs relate, or are attributable, to Landlord’s ownership of the Premises and not to other property owned by Landlord in National Business Park;

(34) Excess costs of any work performed or service provided solely for any other tenant of the Building, if any, other than Tenant to a materially greater extent than that furnished generally to other tenants and occupants (such as electricity and cleaning services provided to retail tenants or other charges for after-hours heating or air conditioning, supplemental chilled water charges, and loading dock services, whether or not reimbursable to Landlord by tenants or other third parties);

(35) Holiday decorations, parties and events;

(36) Utilities paid directly by Tenant pursuant to Section 24, below;

(37) All operating expenses associated with any other building with National Business Park.

(38) Charitable and political contributions, advertising and promotional expenditures, including costs of staging special events.

In addition to the foregoing, all Building Expenses shall be reduced by all cash discounts, trade discounts or quantity discounts received by Landlord or Landlord’s managing agent in the purchase of any goods, utilities or services in connection with the prudent operation of the Building and the Land. Landlord shall not collect from the tenants of the Building more than one hundred percent (100%) of the actual costs of operating the Building and the Land. In the calculation of any Building Expenses, it is understood that no expense shall be charged more than once (whether directly or in Building Expenses). Landlord shall equitably prorate bills for services rendered to the Building and to any other property owned by Landlord. Landlord shall diligently and in good faith pursue all insurance, breach of warranty or other claims or actions that might result in a reduction in Building Expenses payable by Tenant.

6.3 Rent Adjustments for Taxes.

6.3.1 On or before March 31 of each Lease Year, Landlord shall total the Taxes and shall allocate such Taxes to the Rentable Area of the Building in the following manner: Taxes for the foregoing tax year shall be totaled and such total shall be divided by the total rentable square feet in the Building thereby deriving the “Cost of Taxes Per Square Foot” of rentable area. Notwithstanding the foregoing, if Taxes are not fully assessed against the Property during the Base Year for Taxes, the Base Year for Taxes shall be deemed to be the full assessed value of the Taxes for a twelve (12) month period. Notwithstanding anything herein to the contrary, in no event shall Tenant be required to pay any additional rent for Taxes for the first twelve (12) months after the Building has been fully assessed.

6.3.2 In the event that the Cost of Taxes Per Square Foot assessed for any calendar year after calendar year 2005 which is wholly or partly within the Term are greater than the Base Year Taxes, Tenant shall pay to Landlord, as additional rent at the time such Taxes are due and payable, the amount of such excess times the number of Rentable Area of the Premises. Any additional rent due Landlord under this Section shall be due and payable within thirty (30) days after Landlord shall have submitted a written statement to Tenant showing the amount due, together with reasonably adequate documentation sufficient to support the amount requested to be paid pursuant to the invoice after Tenant fully occupies the Building. For Tenant's obligation for such additional rent at the end of the Lease, see Section 6.5. No later than fifteen (15) days prior to the start of each calendar year after the Base Year Taxes are determined, Landlord will deliver to Tenant its reasonable estimate of such additional rent with respect to Taxes, and require Tenant to pay each month, in advance, during such year 1/12 of such amount, at the time of payment of monthly installments of Base Rent. Tenant shall have the right to examine, at Tenant's sole expense, Landlord's records with respect to any such increases in rent; provided, however, that unless Tenant shall have given Landlord written notice of exception to any such statement within thirty (30) days after delivery thereof, the same shall be conclusive and binding on Tenant for the applicable year, subject to Tenant’s audit rights. If Landlord has not delivered the estimate of Taxes to Tenant by the first day of January of the applicable calendar year, Tenant will continue paying Tenant’s Share of Taxes based on the Tax estimate for the previous calendar year until the new estimate of Taxes is delivered. No credit shall be given to Tenant if the Cost of Taxes Per Square Foot are less than the Base Year Taxes.

6.3.3 Landlord’s Right to Contest Property Taxes. Landlord is not obligated to but may contest the amount or validity, in whole or in part, of any Taxes. Landlord’s contest will be at Landlord’s sole cost and expense, except that if Taxes are reduced (or if a proposed increase is avoided or reduced) because of Landlord’s contest, Landlord may include in its computation of Taxes the costs and expenses Landlord incurred in connection with the contest, including, but not limited to, reasonable attorney’s fees, up to the amount of any Tax reduction Landlord realized from the contest or any Tax increase avoided or reduced in connection with the contest, as the case may be.

6.3.4 Tenant’s Right to Request Landlord to Obtain a Reduction in Assessments. Tenant may request in writing that Landlord, from time to time, but no more often than once every two (2) years during the Term, endeavor to obtain a reduction in the assessed valuation of the Building for the purpose of reducing Taxes. In such event, Landlord shall use commercially reasonable efforts to effect such a reduction. Landlord shall have sole control and discretion in its efforts to obtain such reduction in assessments. Landlord shall credit against Taxes any tax refund payable as a result of any proceeding instituted pursuant to this Section 6.3.4. In the event Landlord is successful in obtaining such reduction in the assessed valuation of the Building, all reasonable costs and expenses incurred by Landlord in such endeavor shall be included in Taxes up to the amount of any tax refund payable. To the extent the costs of such proceedings exceed any tax refund or in the event such proceedings are unsuccessful, all such reasonable costs and expenses incurred by Landlord shall be Tenant’s sole responsibility and shall be charged to Tenant as additional rent. Tenant shall be entitled to the refund of any excess Taxes attributable to Taxes, penalties, fines and interest thereon received by Landlord which has been paid by Tenant or which has been paid by Landlord but for which Landlord has been previously reimbursed in full by Tenant, such amount to be paid within thirty (30) days after receipt by Landlord.

6.4 Rent Adjustments for Building Expenses.

6.4.1 On or before March 31 of each Lease Year, Landlord shall compute the Building Expenses for such year and shall allocate such costs to the Rentable Area of the Building in the following manner: Building Expenses shall be totaled and such total shall be divided by the total Rentable Area of the Building thereby deriving the “Cost of Building Expenses Per Square Foot” of rentable area.

6.4.2 In the event that the cost of Building Expenses Per Square Foot of rentable area for any year after calendar year 2005 which is wholly or partly within the Term are greater than the Base Year Building Expenses, Tenant shall pay to Landlord, as additional rent, the amount of such excess times the number of square feet of Rentable Area of the Premises, as set forth in Section 1 above. If, during any year that Tenant is not leasing 100% of the Building, occupancy of the Building during any calendar year is less than one hundred percent (100%), then Building Expenses for that calendar year shall be "grossed up" to that amount of Building Expenses that, using reasonable projections, would normally be expected to be incurred during the calendar year in question if the Building was one hundred percent (100%) occupied during the applicable calendar year period, as determined under generally accepted accounting principles; it being understood that the written statement submitted to Tenant shall provide a reasonably detailed description of how the Building Expenses were grossed up and that only those component expenses that are affected by variations in occupancy levels shall be grossed up. Notwithstanding the provisions of Section 1.1.11, in the event Tenant does not fully occupy the Building during the entire Base Year for Building Expenses, then the Base year for Building Expenses shall be the first twelve (12) calendar months that Tenant fully occupies the Building, provided that if Tenant does not fully occupy the Building within eighteen (18) months after the Commencement Date, the Base Year Building Expenses shall be grossed up using the last twelve (12) months of the eighteen (18) month period. Such additional rent shall be computed on a year-to-year basis. No later than fifteen (15) days prior to the start of each calendar year, Landlord will deliver to Tenant its reasonable estimate of such additional rent with respect to Building Expenses, and require Tenant to pay each month, in advance, during such year 1/12 of such amount, at the time of payment of monthly installments of Base Rent. Tenant shall have the right to examine, at Tenant's sole expense, Landlord's records with respect to any such increases in Building Expenses; provided, however, that unless Tenant shall have given Landlord written notice of exception to any such statement within thirty (30) days after delivery thereof, Tenant shall pay the same for the balance of the year, subject to Tenant’s audit rights. If Landlord has not delivered the estimate of Building Expenses to Tenant by the first day of January of the applicable calendar year, Tenant will continue paying Tenant’s Share of Building Expenses based on the Building Expense estimate for the previous calendar year until the new estimate of Building Expenses is delivered. Tenant shall pay any additional rent owed as a result of increased Building Expenses within thirty (30) days after delivery thereof, the same shall be conclusive and binding on Tenant for the applicable year, subject to Tenant’s audit rights. Any such additional rent shall be due within thirty (30) days after Landlord has submitted a written statement to Tenant showing the amount due. No credit shall be given to Tenant if the cost of Building Expenses Per Square Foot are less than the Base Year Building Expenses. Notwithstanding anything to the contrary contained herein, Landlord shall use diligent efforts to keep Building Expenses at reasonable amounts, while maintaining the Building as a first class office building.

6.4.3 Tenant shall have the right to (i) provide its own janitorial services to all or any portion of the Premises, and/or (ii) require modifications to the standard office janitorial service as described in Exhibit “J” hereto. If Tenant chooses to provide and/or modify such services, Landlord and Tenant shall enter into an amendment to this Lease which reduces or increases, as the case may be, the Annual Base Rent due hereunder from the date Tenant provides such services or requires such modifications, as the case may be by the amount of any savings or increased cost and adjusts the Base Year Building Expenses proportionately. Landlord and Tenant acknowledge and agree that the cost included in the stated Annual Base Rent for standard unescorted, after-hours janitorial services is Eighty Cents ($0.80) per rentable square foot.

6.5 Additional Rent Payments. Tenant’s obligation to pay any additional rent accruing during the Term pursuant to Sections 6.3 and 6.4 hereof shall apply pro rata to the proportionate part of a calendar year as to Taxes and Building Expenses, in which this Lease ends, for the portion of such year during which this Lease is in effect. Such obligation to make payments of such additional rent shall survive the expiration or sooner termination of the Term for one (1) year.

6.6 Payments. All payments or installments of any rent hereunder and all sums whatsoever due under this Lease (including but not limited to court costs and attorneys fees) shall be deemed rent, shall be paid to Landlord at the address designated by Landlord. If any amount of Annual Base Rent or additional rent shall remain unpaid for ten (10) calendar days after written notice that such payment is past due (provided, that in no event shall Landlord be required to give more than two (2) written notices in any twelve (12) month period) , Tenant shall pay Landlord, without notice or demand, a late charge equal to the greater of (i) $35.00 and (ii) five percent (5%) of such overdue amount to partially compensate Landlord for its administrative costs in connection with such overdue payment; which administrative costs Tenant expressly acknowledges are reasonable and do not constitute a penalty. In addition, such overdue amounts shall bear interest at the rate of 15% per annum, but not more than the maximum allowable legal rate applicable to Tenant (the “Default Rate”) until paid. Additionally, if any of Tenant’s checks for payment of rent or additional rent are returned to Landlord for insufficient funds, Tenant shall pay to Landlord as additional rent $50.00 for each such check returned for insufficient funds. Time is of the essence in this Lease. No invoice, nor any request for unscheduled additional rent, shall be sufficient unless accompanied by receipts or other reasonably adequate documentation sufficient to support the amount requested to be paid pursuant to the invoice.

6.7 Annual Taxes and Building Expense Statement. From and after the Rent Commencement Date, after the end of each calendar year, Landlord shall submit to Tenant a statement prepared by Landlord’s property management company (the “Taxes and Building Expense Statement”) setting forth in reasonable detail the Taxes and Building Expenses for such calendar year and the amount (if any) of Tenant’s Share of Building Expenses and Taxes for such calendar year. If Tenant’s Share of the Building Expenses and Taxes so stated is more than the amount (if any) theretofore paid by Tenant for Building Expenses and Taxes for the period covered by the Taxes and Building Expense Statement, Tenant shall pay to Landlord the deficiency within thirty (30) days after the submission of the Taxes and Building Expense Statement. If Tenant’s Share of the Building Expenses or Tenant’s Share of Taxes so stated is less than the amount (if any) theretofore paid by Tenant for Building Expenses or Taxes for the period covered by the Taxes and Building Expense Statement, Landlord shall credit the excess against the next monthly installment of Annual Base Rent thereafter payable by Tenant under this Lease, except that Landlord shall refund the excess (if any) for the calendar year ending with or within the last Lease Year to Tenant within forty-five (45) days after submission of the Taxes and Building Expense Statement for such calendar year. Tenant’s obligation under this subsection to pay Tenant’s Share of Building Expenses and Taxes and Landlord’s obligation to reimburse Tenant for any overpayment shall survive the expiration of the Term or the earlier termination of this Lease for one (1) year.

6.8 Disputes. Each statement of Taxes and Building Expenses shall be in a form sufficiently detailed and complete for Tenant’s adequate review, sent to Tenant shall be conclusively binding upon Tenant unless Tenant shall (i) within thirty (30) days after such statement is sent, pay to Landlord the amount set forth in such statement, without prejudice to Tenant’s right to dispute such statement, and (ii) within one hundred eighty (180) days after such statement is received, give notice to Landlord objecting to such statement and specifying the reasons that such statement is claimed to be incorrect. No such objection shall prejudice Tenant’s right to make further objections with respect to the same statement within the permitted time periods. Tenant shall have the right at its sole cost and expense to review or audit Landlord’s books and records relating to Landlord’s calculation of Building Expenses and Taxes at any time within two years from Tenant’s receipt of the statement, and may use the auditor or reviewer of its choice provided such auditor’s area of expertise includes lease expense analysis. If the parties are unable to resolve a dispute as to the correctness of a statement within thirty (30) days following Tenant’s notice of objection, either party may refer the issues raised to an accountant reasonably acceptable to the other party and that has not and does not provide accounting and consulting services to Landlord or Tenant and does not otherwise have any affiliation or business relationship with Landlord or Tenant, and the decision of such accountants shall be conclusively binding upon Landlord and Tenant. The fees and expenses relating to the accountant hired to conclusively resolve the dispute as to the correctness of the statement shall be borne by the unsuccessful party (and if both parties are partially unsuccessful, the accountants shall apportion the fees and expenses between the parties based on the degree of success of each party). In the event there is an adjustment of the statement, the amount owed by either party shall be increased by interest on the sum owed calculated at the Default Rate from the date of the original payment until the date the adjustment is paid

7. Requirements of Applicable Law. Landlord warrants that on the Commencement Date, the Premises shall comply with the Association Declaration and all applicable Federal, State and local laws, codes, ordinances, rules and regulations of governmental authorities having jurisdiction over the Property, including, but not limited to, zoning rules and regulations and the Americans with Disabilities Act (“Applicable Laws”). Tenant, at its sole cost and expense, shall comply promptly with all Applicable Laws first enacted after the Rent Commencement Date, which impose any duty upon Landlord or Tenant with respect to the use, occupancy or alteration of the Premises or any part thereof and for the prevention of fires; provided, however, that Landlord and not Tenant shall correct all structural defects in the Building necessary to comply with Applicable Laws, and make all repairs, changes or alterations necessary because the Building was not constructed in compliance with any of the Applicable Laws.

8. Certificate of Occupancy. Tenant shall not use or occupy the Premises in violation of any certificate of occupancy, permit, or other governmental consent issued for the Building. If any governmental authority, after the commencement of the Term, shall contend or declare that the Premises are being used for a purpose which is in violation of such certificate of occupancy, permit, or consent, then Tenant shall, upon five (5) days’ notice from Landlord, immediately discontinue such use of the Premises. If thereafter the governmental authority asserting such violation commences or continues criminal or civil proceedings against Landlord for Tenant’s failure to discontinue such use, in addition to any and all rights, privileges and remedies given to Landlord under this Lease for default therein, Landlord shall have the right to terminate this Lease forthwith.

9. Contest-Statute, Ordinance, Etc. Tenant may, after notice to Landlord, by appropriate proceedings conducted promptly at Tenant’s own expense in Tenant’s name and whenever necessary in Landlord’s name, contest in good faith the validity or enforcement of any Applicable Laws and may similarly contest any assertion of violation of any certificate of occupancy, permit, or any consent issued for the Building. Tenant may, pending such contest, defer compliance therewith if, such deferral shall not subject either Landlord or the Premises or the Property (or any part thereof) to any penalty, fine or forfeiture, and if Tenant shall post a bond with corporate surety approved by Landlord sufficient, in Landlord’s opinion, fully to indemnify Landlord from loss.

10. Tenant’s Improvements.

10.1 Except to the extent that Landlord is responsible for making improvements to the Premises pursuant to Section 35 of this Lease and subsequent to the installation of Tenant’s Work pursuant to Section 35, Tenant shall make such improvements to the Premises as it may deem necessary at its sole cost and expense. Notwithstanding anything herein to the contrary, Tenant shall have the right to make non-structural alterations which do not affect the mechanical, electrical or plumbing systems of the Building without obtaining Landlord’s prior consent, provided that either (i) such alterations cost less than Fifty Thousand Dollars ($50,000.00) per occurrence during the Initial Term and One Hundred Thousand Dollars ($100,000,00) during any of the Renewal Term(s), or (ii) are items of decoration, painting or carpeting. Landlord will notify Tenant of Landlord’s election to consent or withhold its consent within ten (10) days after receiving Tenant’s written request for consent to an alteration. If Landlord does not respond within such ten (10) day period, Landlord shall be deemed to have given consent to the proposed alteration. Landlord’s consent to and/or approval of Tenant’s plans and specifications for the aforesaid improvements shall create no responsibility or liability on the part of Landlord for their completeness, design sufficiency, or compliance with all laws, rules and regulations of governmental agencies or authorities. All alterations, installations, additions or improvements made by either of the parties hereto upon the Premises, (except for Tenant’s movable office fixtures, furniture and equipment, trade fixtures, generators, uninterruptible power sources, supplemental HVAC equipment in addition to the base building systems, and other items identified by Tenant prior to the Rent Commencement Date or, after the Rent Commencement Date, as mutually agreed upon in writing, collectively, “Tenant’s Personal Property”), shall be the property of Landlord and shall remain upon and be surrendered with the Premises at the termination of this Lease without molestation or injury. Except for Tenant’s Personal Property, Tenant shall have no obligation to remove any improvements to the Premises, made by or on behalf of Tenant, including, without limitation, the Tenant’s Work. If Tenant fails to remove any of Tenant’s Personal Property items, Landlord shall have the right, but not the obligation, to remove and dispose of such items, and restore the Premises accordingly and Tenant shall reimburse Landlord for the costs of such removal, disposal and restoration within thirty (30) days after receipt of an invoice therefore, together with interest at the Default Rate, which shall accrue form the date the costs were incurred by Landlord.

10.2 Notwithstanding anything herein to the contrary, within six (6) months after the expiration or sooner termination of the Term, Landlord, at Tenant’s expense, shall have the right to remove all of the improvements comprising the auditorium in the Building and restore the level of the floor of such area to match the grade of the balance of the first floor area (the “Restoration Costs”). In no event shall the Restoration Costs exceed the lesser of (i) $67,000.00, or (ii) the amount of costs actually incurred by Landlord. Tenant shall reimburse Landlord for such costs within thirty (30) days after receipt of a written invoice for such Restoration Costs, together with reasonable supporting documentation. Tenant’s obligations under this Section 10.2 shall survive the expiration or sooner termination of this Lease, unless the parties have agreed specifically in writing that the provisions of this Section 10.2 shall be of no further force and effect. If Landlord fails to remove such improvements and restore the level of the floor of such area within the six (6) month period, Tenant shall have no obligation to reimburse Landlord for the Restoration Costs and the provisions of this Section 10.2 shall be of no further force or effect.

11. Repairs and Maintenance.

11.1 Tenant’s Care of the Premises and Building. During the Term Tenant shall:

(i) keep the Tenant’s Personal Property and the fixtures, appurtenances and equipment installed on the Premises in good order and condition, except to the extent such maintenance is the obligation of Landlord pursuant to Section 11.2;

(ii) make repairs and replacements to the Premises required because of Tenant’s misuse or primary negligence, except to the extent that the repairs or replacements are covered by Landlord’s insurance as required hereunder;

(iii) not commit waste.

In addition, Tenant shall not place a load upon any floor of the Premises exceeding the floor load per square foot area which such floor was designed to carry and which may be allowed under Applicable Laws. Landlord reserves the right to prescribe the weight and position of all heavy equipment brought onto the Premises and prescribe any reinforcing required under the circumstances, all such reinforcing to be at Tenant’s expense.

11.2 Landlord’s Repairs. Except for the repairs and replacements that Tenant is required to make pursuant to Section 11.1 above, Landlord shall make all repairs and replacements to the Premises (excluding items of the Tenant’s Work such as wall coverings, carpeting and the like, but including extensions of the Base Building Systems, such as additional sprinkler heads, VAV boxes, supplemental HVAC units, plumbing systems and the like), Common Areas and the Building (including Building fixtures and equipment) as shall be reasonably deemed necessary to maintain the Building in a condition comparable to other newly constructed first class suburban office buildings of comparable quality in the Baltimore‑Washington corridor area (“Comparable Buildings”). If Tenant constructs Tenant’s Work pursuant to the terms of Section 35, to the extent that Tenant installs items as part of its improvements that Landlord is responsible to maintain during the Term, Tenant shall transfer any warranties to Landlord. Without limiting the foregoing, this maintenance shall include (a) the roof, foundation, exterior walls and windows (including interior sprandrel systems and gaskets), interior structural walls, all structural components (including the foundation), and all systems such as mechanical, electrical, HVAC and plumbing, (b) all landscaping and parking areas at the Property (including snow removal and repair); (c) all other repairs deemed reasonably necessary for the prudent management of the Premises or as requested by Tenant. The costs associated with such repairs shall be deemed a part of Building Expenses; provided, however, that (i) costs of all of such repairs which would be considered capital in nature under generally accepted accounting principles shall be paid by Landlord, (ii) the portion of the costs which are covered by warranties shall not be included in the Building Expenses. There shall be no allowance to Tenant for a diminution of rental value, no abatement of rent, and no liability on the part of Landlord by reason of inconvenience, annoyance or injury to business arising from Landlord, Tenant or others making any repairs or performing maintenance as provided for herein. Landlord agrees to diligently attend to any repairs or maintenance needs brought to its attention by written notice from Tenant as soon as reasonably practicable (but in no event shall Landlord commence such repairs or maintenance later than five (5) days (or shorter period as may be reasonably required in an emergency) thereafter or cease to pursue the completion of such repair with diligence) and in a commercially reasonable manner calculated to minimize to the extent possible disruption of Tenant’s business activities.

11.2.1 Failure to Repair or Maintain. If either party fails within the time periods required by this Lease (or such shorter period as may be required in an emergency) to proceed with diligence to make any required repairs or perform any maintenance, the other party may do so and the non-performing party shall reimburse the performing party for within thirty (30) days after receipt of a written invoice for all reasonable, out-of-pocket costs and expenses incurred on account thereof, together with interest at the Default Rate from the date that such costs and expenses were incurred. If Landlord fails to pay the amounts due in connection with this Section, Tenant shall have no rights to offset such amounts against future obligations to pay Annual Base Rent or additional rent until Tenant has received a final, unappealable, adjudicatory decision.

11.2.2 Interruptions Due to Repairs.

(a) Landlord shall minimize interference with Tenant’s use and occupancy of the Premises during the making of any repairs, alterations, additions, improvements, repairs or replacements, Landlord shall provide Tenant with reasonable notice of the scope and schedule of any such work and, in the event that the completion thereof is reasonably likely to disrupt (other than in a de minimis manner) the operation of Tenant’s business at the Premises, Landlord shall perform such work during non-business hours. Except as expressly provided in this Lease to the contrary, there shall be no allowance to Tenant for a diminution of rental value, no abatement of rent, and no liability on the part of Landlord by reason of inconvenience, annoyance or injury to business arising from Landlord, Tenant or others making any repairs or performing maintenance as provided for herein.

(b) Notwithstanding anything to the contrary contained in this Lease, if Tenant is unable to use the Building (or any portion thereof) for the ordinary conduct of Tenant’s business due to an interruption of an Essential Service (as hereinafter defined) resulting from (a) Landlord’s performance of an alteration, addition, impairment, repair or replacement to the Premises, or due to Landlord’s entry into the Premises, or for any other reason within Landlord’s or its agent’s reasonable control, or (b) any of the causes described in Section 27 hereof, and such condition continues for a period in excess of six (6) consecutive days after (i) Tenant furnishes a notice to Landlord (the “Abatement Notice”) stating that Tenant’s inability to so use the Premises (or portion thereof) is due to such condition, and (ii) Tenant does not actually use or occupy the Premises (or portion thereof) during such period for the ordinary conduct of its business, then Annual Base Rent, Taxes and Building Expenses for such portion of the Building that is both untenantable and unoccupied (determined based upon the ratio which the square footage of such portion of the Building, determined using the BOMA Standard bears to the Rentable Area of the Building) shall be abated on a per diem basis for the period commencing on the seventh (7^th) date after the Essential Service is interrupted and ending on the earlier of (x) the date Tenant reoccupies such portion of the Premises for the ordinary conduct of its business, and (y) the date on which such condition is remedied in all material respects. “Essential Service” shall mean any of the service and utilities described in Section 23 hereof.

11.3 Time for Repairs. Repairs or replacements required pursuant to Section 11.1 and 11.2 above shall be made within a reasonable time except in matters of security and safety in which case the repairs shall be made as expeditiously as possible (depending on the nature of the repair or replacement needed - generally no more than fifteen (15) days) after receiving notice or having actual knowledge of the need for a repair or replacement.

11.4 Surrender of the Premises. Upon the termination of this Lease, Tenant shall surrender the Premises to Landlord in the same broom clean condition that the Premises were in on the date the Tenant’s Work is substantially completed except for:

Sample Business Contracts