option, to the last
assignee of Tenant's interest hereunder) within thirty (30) days after the
expiration or earlier termination of this Lease.
9.5.
[Intentionally omitted]
9.6.
If the Security Deposit shall be in cash, Landlord shall deposit
the Security Deposit into an interest-bearing account at a banking organization
selected by Landlord.
All interest and dividends, if any, accruing on the
Security Deposit, less a one percent (1%) per annum charge on the Security
Deposit for administrative expenses (but in no event greater than the amount of
interest actually accrued on the Security Deposit during such annual period),
shall be added to, held and included within the term Security Deposit and,
provided that no Default shall have occurred and be continuing, shall accrue to
the account of Tenant and be disbursed to Tenant annually.
Landlord shall not
be required to credit Tenant with any interest for any period during which
Landlord does not receive interest on the Security Deposit.
9.7.
THE SECURITY DEPOSIT MAY BE IN THE FORM OF CASH, A LETTER OF
CREDIT OR ANY OTHER SECURITY INSTRUMENT ACCEPTABLE TO LANDLORD IN ITS SOLE
DISCRETION.
TENANT MAY AT ANY TIME, EXCEPT
11
DURING DEFAULT, DELIVER A LETTER OF CREDIT (THE "L/C SECURITY") AS THE ENTIRE
SECURITY DEPOSIT, AS FOLLOWS.
(A)
IF TENANT ELECTS TO DELIVER L/C SECURITY, THEN TENANT SHALL
PROVIDE LANDLORD, AND MAINTAIN IN FULL FORCE AND EFFECT THROUGHOUT THE TERM, A
LETTER OF CREDIT IN THE FORM OF EXHIBIT H, OR SUCH OTHER FORM AS IS REASONABLY
ACCEPTABLE TO LANDLORD, ISSUED BY AN ISSUER REASONABLY SATISFACTORY TO LANDLORD,
IN THE AMOUNT OF THE SECURITY DEPOSIT, WITH AN INITIAL TERM OF AT LEAST ONE (1)
YEAR.
IF, AT THE TERM EXPIRATION DATE, ANY RENT REMAINS UNCALCULATED OR UNPAID,
THEN:
(A) LANDLORD SHALL WITH REASONABLE DILIGENCE COMPLETE ANY NECESSARY
CALCULATIONS; (B) TENANT SHALL EXTEND THE EXPIRY DATE OF SUCH L/C SECURITY FROM
TIME TO TIME AS LANDLORD REASONABLY REQUIRES; AND (C) IN SUCH EXTENDED PERIOD,
LANDLORD SHALL NOT UNREASONABLY REFUSE TO CONSENT TO AN APPROPRIATE REDUCTION OF
THE L/C SECURITY.
TENANT SHALL REIMBURSE LANDLORD'S LEGAL COSTS (AS ESTIMATED
BY LANDLORD'S COUNSEL), NOT TO EXCEED ONE THOUSAND FIVE HUNDRED DOLLARS
($1,500), IN HANDLING LANDLORD'S ACCEPTANCE OF L/C SECURITY OR ITS REPLACEMENT
OR EXTENSION.
(B)
IF TENANT DELIVERS TO LANDLORD SATISFACTORY L/C SECURITY IN PLACE
OF THE ENTIRE SECURITY DEPOSIT, LANDLORD SHALL REMIT TO TENANT ANY CASH SECURITY
DEPOSIT LANDLORD PREVIOUSLY HELD.
(C)
LANDLORD MAY DRAW UPON THE L/C SECURITY, AND HOLD AND APPLY THE
PROCEEDS IN THE SAME MANNER AND FOR THE SAME PURPOSES AS THE SECURITY DEPOSIT,
IF:
(A) AN UNCURED DEFAULT EXISTS; (B) AS OF THE DATE THIRTY (30) DAYS BEFORE
ANY L/C SECURITY EXPIRES (EVEN IF SUCH SCHEDULED EXPIRY DATE IS AFTER THE TERM
EXPIRATION DATE) TENANT HAS NOT DELIVERED TO LANDLORD AN AMENDMENT OR
REPLACEMENT FOR SUCH L/C SECURITY, REASONABLY SATISFACTORY TO LANDLORD,
EXTENDING THE EXPIRY DATE TO THE EARLIER OF (I) ONE (1) MONTH AFTER THE
THEN-CURRENT TERM EXPIRATION DATE OR (II) THE DATE ONE