Common use of Capital Repairs Clause in Contracts

Capital Repairs. Notwithstanding anything to the contrary contained herein, if Tenant (A) determines in its reasonable, good faith discretion that (1) a component of Tenant’s maintenance and repair obligations under Section 11.3, excluding repair, maintenance or replacement of any of Tenant Changes, (a “Tenant Work Component”), is in such a condition that a repair or replacement is required and (2) such repair or replacement of an individual Tenant Work Component constitutes a capital repair or capital improvement in accordance with standard accounting principles generally followed by the commercial real estate industry in Santa Xxxxx County, CA, consistently applied (a “Tenant Work Component Capital Repair”), and (B) desires to have Landlord perform such Tenant Work Component Capital Repair, then Tenant shall provide Landlord a reasonable prior written notice (a “Capital Repair Notice”), which Capital Repair Notice shall include or otherwise be accompanied by the following: (I) a written report from a reputable third-party physical inspection firm (which firm Landlord must have reasonably approved to prepare such report prior to commencing its work), detailing the reasons that such firm believes such Tenant Work Component Capital Repair is required, and (II) a request for Landlord to perform such Tenant Work Component Capital Repair. Notwithstanding the foregoing, Landlord shall have no obligation to perform any Tenant Work Component Capital Repair that is primarily caused by Tenant’s failure to maintain the applicable Tenant Work Component in accordance with Section 11.3. Upon receipt of a Capital Repair Notice, Landlord will perform the Tenant Work Component Capital Repair with reasonable promptness and the cost incurred by Landlord shall be amortized by Landlord over the useful life of such Tenant Work Component Capital Repair as reasonably estimated by Landlord in accordance with standard accounting principles generally followed by the commercial real estate industry in Santa Xxxxx County, CA, consistently applied, and the total amortized cost for the remaining term of the Lease shall be payable in a lump sum within thirty (30) days of Tenant’s receipt of invoice from Landlord by Tenant.

Capital Repairs. Notwithstanding anything OMS Costs which are customarily characterized as capital in nature under generally accepted accounting principals are referred to the contrary contained herein, if Tenant herein as "Capital Repairs". The cost of Capital Repairs (A) determines in its reasonable, good faith discretion that (1) a component of Tenant’s maintenance and repair obligations under Section 11.3, excluding repair, maintenance or replacement of any of Tenant Changes, (a “Tenant Work Component”), is in such a condition that a repair or replacement is required and (2) such repair or replacement of an individual Tenant Work Component constitutes a capital repair or capital improvement in accordance with standard accounting principles generally followed by the commercial real estate industry in Santa Xxxxx County, CA, consistently applied (a “Tenant Work Component Capital Repair”), and (B) desires to have Landlord perform such Tenant Work Component Capital Repair, then Tenant shall provide Landlord a reasonable prior written notice (a “Capital Repair Notice”), which Capital Repair Notice shall include or otherwise be accompanied by all of Lxxxxxx'x out of pocket costs of performing the following: (ICapital Repairs, including soft costs and permit fees) a written report from a reputable third-party physical inspection firm (which firm Landlord must have reasonably approved to prepare such report prior to commencing its work), detailing the reasons that such firm believes such Tenant Work Component Capital Repair is required, and (II) a request for Landlord to perform such Tenant Work Component Capital Repair. Notwithstanding the foregoing, Landlord shall have no obligation to perform any Tenant Work Component Capital Repair that is primarily caused by Tenant’s failure to maintain the applicable Tenant Work Component in accordance with Section 11.3. Upon receipt of a Capital Repair Notice, Landlord will perform the Tenant Work Component Capital Repair with reasonable promptness and the cost incurred by Landlord shall be amortized by Landlord (using an interest rate of the lesser of Lxxxxxx'x actual cost or ten percent (10%)) over the useful life of such Tenant Work Component repair, and Multilayer shall be required to reimburse Lxxxxxx only for the amortization thereof that relates to the term of this Agreement, multiplied by the applicable Allocation Ratio. Capital Repairs shall be performed by Lxxxxxx only to the extent required by law, or otherwise if reasonably required to keep the Thermal Energy Plant in the same working order as it currently is in throughout the Term hereof. Lxxxxxx shall use reasonable efforts to perform Capital Repairs at a commercially reasonable cost. Lxxxxxx shall deliver to Multilayer a statement of the cost of any Capital Repair as reasonably estimated by Landlord in accordance with standard accounting principles generally followed by the commercial real estate industry in Santa Xxxxx County, CA, consistently applied, and the total amortized cost for the remaining term of the Lease shall be payable in a lump sum amortization thereof within thirty (30) days of Tenant’s receipt the date the Capital Repair was completed. During each month during the term hereof that there is outstanding amortization for a Capital Repair, said amortization shall be multiplied by the applicable Allocation Ratio for such month and the product thereof shall be paid at the same time that payments for other OMS Costs are due hereunder, commencing on the date the Capital Repair is completed, and prorated for any partial months. By way of invoice from Landlord example, assuming a Capital Repair with a cost of $100,000, a useful life of ten years, an interest rate of ten percent (10%) and an Allocation Ratio for a particular month during the term hereof of .2, Multilayer would pay Lxxxxxx $264.30 for that month. If the Allocation Ratio in the following month were .1, then Multilayer would pay $132.15 for such month. Notwithstanding the foregoing, Multilayer shall have no obligation to pay for any amortization of Capital Repairs so long as the Lease is in effect and the owner of the fee interest in the Multilayer Property and the Thermal Energy Plant are the same. Further, so long as the Lease is in effect, Lxxxxxx shall not be permitted to perform or charge Multilayer for Capital Repairs (or Capital Repairs and Replacements, as defined in the Lease) except as permitted by Tenantthe Lease.