Common use of Definition of Operating Costs Clause in Contracts

Definition of Operating Costs. The term "Operating Costs" shall mean all costs and expenses paid or incurred by Landlord or on Landlord's behalf in connection with the ownership, management, repair, replacement, remodeling, maintenance and operation of the Development (including, without limitation, all assessed real property taxes, assessments (whether general or special) and governmental charges of any kind and nature whatsoever including assessments due to deed restrictions and/or owner's associations, which accrue against the building and/or development of which the premises are a part, the costs of maintaining and repairing parking lots, parking structures, easements, and landscaping, property management fees, utility costs to the extent not separately metered, insurance premiums, depreciation of the costs of replacement (as defined below) of the building and improvements in the Development but not including any structural repairs or replacements which are normally chargeable to capital accounts under sound accounting principles, and the Building's share of costs of the Development). The term "operating costs" does not include; (i) costs of alterations of tenants' premises; (ii) costs of curing construction defects; (iii) interest and principal payments on mortgages, and other debt cost; (iv) real estate brokers' leasing commissions or compensation; (v) any cost or expenditure for which Landlord is reimbursed, whether by insurance proceeds or otherwise; (vi) cost of any service furnished to any other occupant of the Building which Landlord does not provide to tenant hereunder. Structural repairs and replacements are repairs and replacements to the foundations, load-bearing walls, columns and joists and replacement of roofing and roof deck. Notwithstanding anything contained herein to the contrary, depreciation of any capital improvements which are intended to reduce Operating Costs, or are required under any governmental laws, regulations or ordinances which were not applicable to the Building or the Development at the time it was constructed, or are recommended by the N.F.P.A. Life Safety Code, shall be included in Operating Costs. The useful life of any such improvement as well as all non-structural replacements shall be reasonably determined by Landlord. In addition, interest on the undepreciated cost of any such improvement or non-structural replacement (at the prevailing construction loan rate available to Landlord on the date the cost of such improvement was incurred) shall also be included in Operating Costs. If Landlord selects the accrual method of accounting rather than the cash accounting method for Operating Costs purposes, Operating Costs shall be deemed to have been paid when such expenses have accrued. Landlord shall have the right at any time and from time to time to elect, which election shall be subject to revocation, to exclude that portion of Operating Costs attributable to any separately assessed part of the Development and any separate building within the Development. During any period that Operating Costs attributable to any separately assessed part of the Development and/or separate building are so excluded from Operating Costs, then for the purposes of calculating Tenant's proportionate share of Operating Costs as provided in Section 7.02, the denominator shall not include the rentable area of such separately assessed part of the Development and/or such separate building. Landlord may, in a reasonable manner, allocate insurance premiums for so-called "blanket" insurance policies which insure other properties as well as the Development and said allocated amount shall be deemed to be an Operating Cost. If at any time during the term of this lease, the present method of taxation shall be changed so that in lieu of the whole or any part of any taxes, assessments or governmental charges levied, assessed or imposed on real estate and the improvements thereon, there shall be levied, assessed or imposed on Landlord a capital levy or other tax directly on the rents received therefrom and/or a franchise tax, assessment, levy or charge measured by or based, in whole or in part, upon such rents for the present or any future building or buildings on the premises, then all such taxes, assessments, levies or charges, or the part thereof so measured or based, shall be deemed to be included within the term "taxes" for the purposes hereof.

Definition of Operating Costs. The term "“Operating Costs" ” shall mean all costs and expenses paid or incurred by Landlord or on Landlord's ’s behalf in connection with the ownership, management, repair, replacementreplacements, remodeling, maintenance and operation of the Development (including, without limitation, all assessed real property taxes, assessments ad valorem realty taxes, assessments, (whether general or special) ), and governmental charges of any kind and nature whatsoever whatsoever, including assessments due to deed restrictions and/or owner's ’s associations, which accrue against the building and/or development of which the premises Premises are a part, the costs of maintaining and repairing parking lots, parking structures, easements, and landscaping, property management feesfees capped at three percent (3%) of Lease revenues, utility costs to the extent not separately metered, insurance premiums, depreciation of the costs of replacement replacements (as defined below) of the building and improvements in the Development Development, but not including any structural repairs or replacements which are normally chargeable to capital accounts under sound accounting principles, and the Building's ’s share of costs of the Development). The term "operating costs" “Operating Costs” does not include; : (i) costs of alterations of tenants' ’ premises; (ii) costs of curing construction defects; (iii) interest and principal payments on mortgages, and other debt cost; (iv) real estate brokers' ’ leasing commissions or compensationcompensations; (v) any cost or expenditure for which Landlord is reimbursed, whether by insurance proceeds or otherwise; (vi) cost of any service furnished to any other occupant of the Building which Landlord does not provide to tenant Tenant hereunder. Structural repairs and replacements are repairs and replacements to the foundations, load-bearing walls, columns and joists and replacement of roofing and roof deck. Notwithstanding anything contained herein to the contrary, depreciation of any capital improvements which are intended to reduce Operating Costs, or are required under any governmental laws, regulations or ordinances which were not applicable to the Building or the Development at the time it was constructed, or are recommended by the N.F.P.A. Life Safety Code, shall be included in Operating Costs. The useful life of any such improvement as well as all non-structural replacements shall be reasonably determined by Landlord. In addition, interest on the undepreciated cost of any such improvement or non-structural replacement (at the prevailing construction loan rate available to Landlord on the date the cost of such improvement was incurred) shall also be included in Operating Costs. If Landlord selects the accrual method of accounting rather than the cash accounting method for Operating Costs purposes, Operating Costs shall be deemed to have been paid when such expenses have accrued. Landlord shall have the right at any time and from time to time to elect, which election shall be subject to revocation, to exclude that portion of Operating Costs attributable to any separately assessed part of the Development and any separate building within the Development. During any period that Operating Costs attributable to any separately assessed part of the Development and/or separate building are so excluded from Operating Costs, Costs then for the purposes of calculating Tenant's ’s proportionate share of Operating Costs as provided in Section 7.02, the denominator shall not include the rentable area of such separately assessed part of the Development and/or such separate building. Landlord may, in a reasonable manner, allocate insurance premiums for so-called "“blanket" ” insurance policies which insure other properties as well as the Development and said allocated amount shall be deemed to be an Operating CostCost so long as the allocated cost does not exceed the cost that would be incurred for the single building. If at any time during the term of this lease, Lease the present method of taxation shall be changed so that in lieu of the whole or any part of any taxes, assessments assessments, or governmental charges levied, assessed or imposed on real estate and the improvements thereon, there shall be levied, assessed or imposed on Landlord a capital levy or other tax directly on the rents received therefrom and/or a franchise tax, assessment, levy or charge measured by or based, in whole or in part, upon such rents for the present or any future building or buildings on the premisesPremises, then all such taxes, assessments, levies or charges, or the part thereof so measured or based, shall be deemed to be included within the term "“taxes" ” for the purposes hereof.

Definition of Operating Costs. The term "Operating Costs" shall mean include all reasonable expenses and reasonable costs (but not specific costs which are separately billed to and expenses paid by individual tenants) of every kind and nature which Landlord pays or incurred by Landlord becomes obligated to pay because of, or on Landlord's behalf in connection with with, the ownership, management, repair, replacement, remodeling, operation or maintenance and operation of the Development Project and supporting facilities of the Project, including but not limited to all real estate taxes and annual installments of special assessments which are assessed, levied, charged, confirmed or imposed by any public authority (excluding any interest or penalty for late payment) upon the Project, its operations or the Rent provided for in this Lease (provided, however, that real estate taxes and special assessments attributable to the Building's parking structure will be excluded from Operating Costs), reasonable costs of any contest of such taxes, including reasonable attorneys' fees, to the extent taxes are reduced as a result of contest; management fees not in excess of four percent (4%) of gross Building rental amounts, insurance premiums (provided, however, that liability insurance premiums attributable to the Building's parking structure will be excluded from Operating Costs), the cost of supplying electricity to the Building's parking structure, and utility costs, janitorial costs, Building security costs, costs of wages (including, without limitation, the reasonable cost of overtime wages necessary to perform those items of maintenance and repair work generally performed by other landlords in the Minneapolis downtown office district on an overtime basis in order to minimize inconvenience to tenants), Project repair and maintenance costs, including those which incidentally benefit the Building's parking structure (such as sump pump maintenance and maintenance of the ventilation system serving the parking structure); and all assessed real property taxes, assessments (whether general or special) and governmental charges other reasonable costs of any kind and nature whatsoever including assessments due to deed restrictions and/or ownerwhich for federal tax purposes may be expensed rather than capitalized. Tenant shall not be responsible for any increase in real estate taxes which results solely from the creation of additional rentable area on the Land or in the Building or from improvements or alterations made by Landlord or other tenants unless Tenant's associations, Proportionate Share shall be adjusted accordingly. Costs which accrue against would under generally accepted accounting principles be deemed capital costs or capital expenditures may be included in the building and/or development definition of which the premises are a part, the costs of maintaining and repairing parking lots, parking structures, easements, and landscaping, property management fees, utility costs "Operating Costs" only to the extent not separately metered, insurance premiums, depreciation of the costs of replacement (as defined below) of the building and improvements in the Development but not including any structural repairs or replacements which are normally chargeable to capital accounts under sound accounting principles, and the Building's share of costs of the Development). The term "operating costs" does not include; that such cost: (i) costs relates to an expenditure which is required to comply with changes in Legal Requirements, as defined in Section 32, which occur after the Commencement Date but then only to the extent in any one year of alterations the amount equal to the total expenditure divided by the useful life of tenants' premises; the improvement which requires such cost, or (ii) costs of curing construction defects; (iii) interest and principal payments on mortgages, and other debt cost; (iv) real estate brokers' leasing commissions or compensation; (v) relates to an expenditure which is incurred based upon a reasonable forecast that such expenditure will reduce in future years another cost which would be deemed an Operating Cost but then only to the extent in any cost or expenditure for which Landlord is reimbursed, whether by insurance proceeds or otherwise; (vi) cost of any service furnished to any other occupant one year of the Building which Landlord does not provide to tenant hereunder. Structural repairs and replacements are repairs and replacements to the foundations, load-bearing walls, columns and joists and replacement originally estimated amount of roofing and roof deck. Notwithstanding anything contained herein to the contrary, depreciation of any capital improvements which are intended to reduce Operating Costs, or are required under any governmental laws, regulations or ordinances which were not applicable to the Building or the Development at the time it was constructed, or are recommended by the N.F.P.A. Life Safety Code, shall be included in Operating Costs. The useful life of any such improvement as well as all non-structural replacements shall be reasonably determined by Landlord. In addition, interest on the undepreciated cost of any such improvement or non-structural replacement (at the prevailing construction loan rate available to Landlord on the date the cost of such improvement was incurred) shall also be included in Operating Costs. If Landlord selects the accrual method of accounting rather than the cash accounting method for Operating Costs purposes, Operating Costs shall be deemed to have been paid when such expenses have accrued. Landlord shall have the right at any time and from time to time to elect, which election shall be subject to revocation, to exclude that portion of Operating Costs attributable to any separately assessed part of the Development and any separate building within the Development. During any period that Operating Costs attributable to any separately assessed part of the Development and/or separate building are so excluded from Operating Costs, then savings for the purposes of calculating Tenant's proportionate share of Operating Costs as provided in Section 7.02, the denominator shall not include the rentable area of such separately assessed part of the Development and/or such separate building. Landlord may, in a reasonable manner, allocate insurance premiums for so-called "blanket" insurance policies which insure other properties as well as the Development and said allocated amount shall be deemed to be an Operating Cost. If at any time during the term of this lease, the present method of taxation shall be changed so that in lieu of the whole or any part of any taxes, assessments or governmental charges levied, assessed or imposed on real estate and the improvements thereon, there shall be levied, assessed or imposed on Landlord a capital levy or other tax directly on the rents received therefrom and/or a franchise tax, assessment, levy or charge measured by or based, in whole or in part, upon such rents for the present or any future building or buildings on the premises, then all such taxes, assessments, levies or charges, or the part thereof so measured or based, shall be deemed to be included within the term "taxes" for the purposes hereofyear it is charged.

Definition of Operating Costs. The term "Operating Costs" shall mean are all costs and ----------------------------- expenses paid or incurred by Landlord or on Landlord's behalf in connection with the Project and its ownership, operation, management, maintenance, repair, replacementreplacement and improvement, remodeling, maintenance and operation of the Development (including, without limitation, all assessed real property taxescosts for: services, assessments costs and utilities not otherwise directly paid or reimbursed by tenants; materials, supplies and equipment; insurance premiums and costs (whether general including deductibles); wages and payroll, including bonuses, fringe benefits, workers compensation and payroll taxes (and Landlord, will not staff the Project with more employees than are reasonably necessary, as determined in Landlord's commercially reasonable judgement); professional and consulting fees; management fees (which for the first five (5) years of the term will be 3.5% of the gross revenues from the Project, including rent, Taxes, Operating Costs, utilities and services (other than utilities and services payable directly to third-party providers) by Tenant and the other tenants, and thereafter will be charged at that rate or special) at then-prevailing rates, whichever is greater), or if no managing agent is retained, an amount in lieu thereof not in excess of the foregoing amounts as permitted above; an annual audit of Landlord's books and governmental charges records relating to the Project and the preparation of Landlord's annual financial statements (but not its tax returns); cafeteria charges; and complying with any kind Laws and nature whatsoever including assessments due to deed restrictions and/or ownerinsurance requirements. Operating Costs do not include: Taxes ------------------------------ or the exclusions therefrom; depreciation of the Project structures and improvements; Landlord's associationsloan fees, which accrue against debt service or ground lease payments; brokerage commissions; the building and/or development cost of which the premises are a partLandlord's Work (if any), the tenant allowances or workletter costs; costs of maintaining and repairing parking lotsnegotiating or enforcing leases; free rent, parking structures, easements, and landscaping, property management fees, utility costs rent abatements or similar inducements offered by Landlord to obtain tenants; expenses for repairs or maintenance to the extent not separately meteredreimbursed by warranties, guaranties, service contracts or insurance premiumsproceeds; compensation paid to clerks, depreciation of attendants or other similar persons in any commercial concessions operated by Landlord; costs for the costs of replacement (as defined belowopposed to maintenance and repair) of the building and improvements roof or the basic structural components of the Project; costs involved in defending Landlord's title to or interest in the Development but not including any structural repairs Project; costs to influence prospective legislation; and costs directly paid or replacements which are normally chargeable to capital accounts under sound accounting principles, and specifically reimbursed by tenants in the Building's share Project (other than by an allocation of costs of the Development). The term "operating costs" does not include; (i) costs of alterations of tenants' premises; (ii) costs of curing construction defects; (iii) interest and principal payments on mortgages, and other debt cost; (iv) real estate brokers' leasing commissions or compensation; (v) any cost or expenditure for which Landlord is reimbursed, whether by insurance proceeds or otherwise; (vi) cost of any service furnished to any other occupant of the Building which Landlord does not provide to tenant hereunder. Structural repairs and replacements are repairs and replacements to the foundations, load-bearing walls, columns and joists and replacement of roofing and roof deck. Notwithstanding anything contained herein to the contrary, depreciation of any capital improvements which are intended to reduce Operating Costs, or are required under any governmental laws, regulations or ordinances which were not applicable to the Building or the Development at the time it was constructed, or are recommended by the N.F.P.A. Life Safety Code, shall be included in Operating Costs. The useful life of any such improvement as well as all non-structural replacements shall be reasonably determined by Landlord. In addition, interest on the undepreciated cost of any such improvement or non-structural replacement (at the prevailing construction loan rate available to Landlord on the date the cost of such improvement was incurred) shall also be included in Operating Costs. If Landlord selects the accrual method of accounting rather than the cash accounting method for Operating Costs purposes, Operating Costs shall be deemed to have been paid when such expenses have accrued. Landlord shall have the right at any time and from time to time to elect, which election shall be subject to revocation, to exclude that portion of Operating Costs attributable to any separately assessed part of the Development and any separate building within the Development. During any period that Operating Costs attributable to any separately assessed part of the Development and/or separate building are so excluded from Operating Costs, then for the purposes of calculating Tenant's proportionate share of Operating Costs as provided in Section 7.02, the denominator shall not include the rentable area of such separately assessed part of the Development and/or such separate building. Landlord may, in a reasonable manner, allocate insurance premiums for so-called "blanket" insurance policies which insure other properties as well as the Development and said allocated amount shall be deemed to be an Operating Cost. If at any time during the term of this lease, the present method of taxation shall be changed so that in lieu of the whole or any part of any taxes, assessments or governmental charges levied, assessed or imposed on real estate and the improvements thereon, there shall be levied, assessed or imposed on Landlord a capital levy or other tax directly on the rents received therefrom and/or a franchise tax, assessment, levy or charge measured by or based, in whole or in part, upon such rents for the present or any future building or buildings on the premises, then all such taxes, assessments, levies or charges, or the part thereof so measured or based, shall be deemed to be included within the term "taxes" for the purposes hereof).

Definition of Operating Costs. The term "“Operating Costs" ” shall mean all costs and expenses paid or incurred by Landlord or on Landlord's ’s behalf in connection with the ownership, management, repair, replacement, remodeling, maintenance and operation of the Development (including, without limitation, all assessed real property taxes, assessments (whether general or special) and governmental charges of any kind and nature whatsoever including assessments due to deed restrictions and/or owner's ’s associations, which accrue against the building Building and/or development of which the premises are a partDevelopment, the costs of maintaining and repairing parking lots, parking structures, easements, and landscaping, property management fees, utility costs to the extent not separately metered, insurance premiums, depreciation and amortization of the costs cost of replacement any capital improvements made to the Building, provided that (a) the cost of any such capital improvements are for the purpose of reducing Operating Costs for the Building or (b) are required by governmental regulation or authority (unless the capital improvement is required to be made as defined below) a result of an existing law, order, ordinance, direction, regulation or requirement of federal, state, county or municipal authority applicable to the Building as of the building and improvements date of this Lease, in which case the Development but amortization of such capital improvement shall not including any structural repairs or replacements which are normally chargeable to capital accounts under sound accounting principles, and the Building's share of costs of the Developmentbe included in Operating Costs). The term "operating costs" Operating Costs does not include; : (i) costs of alterations of tenants' premisesTenant’s Premises; (ii) costs of curing construction defects; (iii) interest and principal payments on mortgages, ground lease payments, and other debt cost; (iviii) real estate brokers' ’ leasing commissions or compensation; (viv) any cost or expenditure for which Landlord is reimbursed, whether by insurance proceeds or otherwise; (vi) cost of any service furnished to any other occupant of the Building which Landlord does not provide to tenant hereunder. Structural repairs and replacements are repairs and replacements to the foundations, load-bearing walls, columns and joists and replacement of roofing and roof deck. Notwithstanding anything contained herein to the contrary, depreciation of any capital improvements which are intended to reduce Operating Costs, or are required under any governmental laws, regulations or ordinances which were not applicable to the Building or the Development at the time it was constructed, or are recommended by the N.F.P.A. Life Safety Code, shall be included in Operating Costs. The useful life of any such improvement as well as all non-structural replacements shall be reasonably determined by Landlord. In addition, interest on the undepreciated cost of any such improvement or non-structural replacement (at the prevailing construction loan rate available to Landlord on the date the cost of such improvement was incurred) shall also be included in Operating Costs. If Landlord selects the accrual method of accounting rather than the cash accounting method for Operating Costs purposes, Operating Costs shall be deemed to have been paid when such expenses have accrued. Landlord shall have the right at any time and from time to time to elect, which election shall be subject to revocation, to exclude that any portion of Operating Costs attributable to any separately assessed part of the Development and any separate building within the Development. During any period that Operating Costs attributable to any separately assessed part of the Development and/or separate building are so excluded from Operating Costs, then for the purposes of calculating Tenant's ’s proportionate share of Operating Costs as provided in Section 7.02, the denominator shall not include the rentable area of such separately assessed part of the Development and/or such separate building. Landlord may, in a reasonable and equitable manner, allocate insurance premiums for so-called "“blanket" ” insurance policies which insure other properties as well as the Development and said allocated amount shall be deemed to be an Operating Cost. If at any time during Notwithstanding anything to the term of contrary contained in this leaseLease, the present method of taxation following costs and expenses shall be changed so that in lieu of the whole or any part of any taxes, assessments or governmental charges levied, assessed or imposed on real estate and the improvements thereon, there shall be levied, assessed or imposed on Landlord a capital levy or other tax directly on the rents received therefrom and/or a franchise tax, assessment, levy or charge measured by or based, in whole or in part, upon such rents for the present or any future building or buildings on the premises, then all such taxes, assessments, levies or charges, or the part thereof so measured or based, shall be deemed to be included within the term "taxes" for the purposes hereof.excluded from Operating Costs:

Definition of Operating Costs. The term "Operating Costs" shall mean all costs and expenses paid or incurred by Landlord or on Landlord's behalf in connection with the ownership, management, repair, replacement, remodeling, maintenance and operation of the Development (including, without limitation, all assessed real property taxes, assessments (whether general or special) and governmental charges of any kind and nature whatsoever including assessments due to deed decd restrictions and/or owner's associations, which accrue against the building and/or development of which the premises are a part, the costs of maintaining and repairing parking lots, parking structures, easements, and landscaping, property management fees, utility costs to the extent not separately metered, insurance premiums, depreciation of the costs of replacement (as defined below) of the building and improvements in the Development but not including any structural repairs or replacements which are normally chargeable to capital accounts under sound accounting principles, and the Building's share of costs of the Development). The 'file term "operating costs" does not include; (i) costs of alterations of tenants' premises; (ii) costs of curing construction defects; (iii) interest and principal payments on mortgages, and other debt cost; (iv) real estate brokers' leasing commissions or compensation; (v) any cost or expenditure for which Landlord is reimbursed, whether by insurance proceeds or otherwise; (vi) cost of any service furnished to any other occupant of the Building which Landlord does not provide to tenant hereunder. Structural repairs and replacements are repairs and replacements to the foundations, load-bearing walls, columns and joists and replacement of roofing and roof deck. Notwithstanding anything contained herein to the contrary, depreciation of any capital improvements which are intended to reduce Operating Costs, or are required under any governmental laws, regulations or ordinances which were not applicable to the Building or the Development at the time it was constructed, or are arc recommended by the N.F.P.A. Life Safety Code, shall be included in Operating Costs. The useful life of any such improvement as well as all non-structural nonstructural replacements shall be reasonably determined by Landlord. In addition, interest on the undepreciated cost of any such improvement or non-structural replacement (at the prevailing construction loan rate available to Landlord on the date the cost of such improvement was incurred) shall also be included in Operating Costs. If Landlord selects the accrual method of accounting rather than the cash accounting method for Operating Costs purposes, Operating Costs shall be deemed to have been paid when such expenses have accrued. Landlord shall have the right at any time and from time to time to elect, which election shall be subject to revocation, to exclude that portion of Operating Costs attributable to any separately assessed part of the Development and any separate building within the Development. During any period that Operating Costs attributable to any separately assessed part of the Development and/or separate building are so excluded from Operating Costs, Landlord: _____ Tenant: _____ then for the purposes of calculating Tenant's proportionate share of Operating Costs as provided in Section 7.02, the denominator shall not include the rentable area of such separately assessed part of the Development and/or such separate building. Landlord may, in a reasonable manner, allocate insurance premiums for so-called "blanket" insurance policies which insure other properties as well as the Development and said allocated amount shall be deemed to be an Operating Cost. If at any time during the term of this lease, the present method of taxation shall be changed so that in lieu of the whole or any part of any taxes, assessments or governmental charges levied, assessed or imposed on real estate and the improvements thereon, there shall be levied, assessed or imposed on Landlord a capital levy or other tax directly on oil the rents received therefrom and/or and/ or a franchise tax, assessment, levy or charge measured by or based, in whole or in part, upon such rents for the present or any future building or buildings on the premises, then all such taxes, assessments, levies or charges, or the part thereof so measured or based, shall be deemed to be included within the term "taxes" for the purposes hereof.

Definition of Operating Costs. The term "Operating Costs" shall mean all costs incurred and expenses paid or incurred expenditures of whatever nature made by Landlord or on Landlord's behalf in connection with the ownershipoperation and management for repair and replacements, management, repair, replacement, remodeling, cleaning and maintenance and operation of the Development (Building, Land and grounds including, without limitation, all assessed real property taxes, assessments (whether general or special) vehicular and governmental charges of any kind and nature whatsoever including assessments due to deed restrictions and/or owner's associations, which accrue against the building and/or development of which the premises are a part, the costs of maintaining and repairing parking lots, parking structures, easements, and landscaping, property management fees, utility costs to the extent not separately metered, insurance premiums, depreciation of the costs of replacement (as defined below) of the building and improvements in the Development but not including any structural repairs or replacements which are normally chargeable to capital accounts under sound accounting principles, and the Building's share of costs of the Development). The term "operating costs" does not include; (i) costs of alterations of tenants' premises; (ii) costs of curing construction defects; (iii) interest and principal payments on mortgages, and other debt cost; (iv) real estate brokers' leasing commissions or compensation; (v) any cost or expenditure for which Landlord is reimbursed, whether by insurance proceeds or otherwise; (vi) cost of any service furnished to any other occupant of the Building which Landlord does not provide to tenant hereunder. Structural repairs and replacements are repairs and replacements to the foundations, load-bearing walls, columns and joists and replacement of roofing and roof deck. Notwithstanding anything contained herein to the contrary, depreciation of any capital improvements which are intended to reduce Operating Costs, or are required under any governmental laws, regulations or ordinances which were not applicable pedestrian passageways related to the Building or Land, and all related equipment, facilities and appurtenances, elevators, cooling and heating equipment. In the Development at event that Landlord or Landlord's managers or agents perform services for the time it was constructedbenefit of the Building off-site which would otherwise be performed on-site (e.g., or are recommended by accounting), the N.F.P.A. Life Safety Code, cost of such services shall be reasonably allocated among the properties benefiting from such service and shall be included in Operating Costs. The useful life of any such improvement Building's pro rata share (as well as all non-structural replacements shall be reasonably determined by Landlord. In addition, interest on the undepreciated cost ) of any such improvement or non-structural replacement (at the prevailing construction loan rate available to Landlord on the date the cost of such improvement was incurredoperating, managing (including, without limitation, the cost of the management office), maintaining and cleaning (including, without limitation, snow and ice removal) the common areas shall also be included in Operating Costs. If Landlord selects the accrual method of accounting rather than the cash accounting method for Operating Costs purposes, Operating Costs shall include, without limitation, those categories of Specifically Included Operating Costs, as set forth below, but shall not include "Excluded Costs," as hereinafter defined. (2) Definition of Excluded Costs. "Excluded Costs" shall be deemed defined as the cost of electric energy purchased for the Premises by Tenant under Article 14.3 hereof, mortgage charges, brokerage commissions or other costs related to have been paid when such expenses have accrued. the sale or marketing (including leasing) of the Building or Land, salaries of executives and owners not directly employed in the management/operation of the Building, the cost of work done by Landlord shall have for a particular tenant for which Landlord has the right at any time and from time to time be reimbursed by such Tenant, management fees to electthe extent they exceed three percent (3.0%) of gross rentals in the Building per annum, which election shall be and, subject to revocationSubparagraph (3) below, to exclude such portion of expenditures as are not properly chargeable against income. In addition, Landlord agrees that portion the amount of Operating Costs attributable to any separately assessed part of the Development and any separate building within the Development. During any period that Operating Costs attributable to any separately assessed part of the Development and/or separate building are so excluded (excluding those arising from Operating "Non-controllable Costs, then for the purposes of calculating Tenant's proportionate share of Operating Costs as provided in Section 7.02, the denominator ") shall not include increase by more than four percent (4.0%) per annum on a cumulative basis throughout the rentable area of such separately assessed part of the Development and/or such separate buildingTerm. Landlord mayFor purposes hereof, in a reasonable manner, allocate insurance premiums for so-called "blanket" insurance policies which insure other properties as well as the Development and said allocated amount shall be deemed to be an Operating Cost. If at any time during the term of this lease, the present method of taxation shall be changed so that in lieu of the whole or any part of any taxes, assessments or governmental charges levied, assessed or imposed on real estate and the improvements thereon, there shall be levied, assessed or imposed on Landlord a capital levy or other tax directly on the rents received therefrom and/or a franchise tax, assessment, levy or charge measured by or based, in whole or in part, upon such rents for the present or any future building or buildings on the premises, then all such taxes, assessments, levies or charges, or the part thereof so measured or based, shall be deemed to be included within the term "taxesNon-controllable Costs" for shall mean the purposes hereof.costs of plowing, removal, sanding and/or salting of snow and ice; utilities; and insurance, (3)

Definition of Operating Costs. The term "Operating Costs" Costs shall mean all costs and expenses paid or incurred by Landlord or on Landlord's behalf in connection with the ownership, management, repair, replacement, remodeling, maintenance and operation of the Development (including, without limitation, all assessed real property taxes, assessments (whether general or special) and governmental charges of any kind and nature whatsoever including assessments due to deed restrictions and/or owner's associations, which accrue against the building and/or development of which the premises are a part, the costs of maintaining and repairing parking lots, parking structures, easements, and landscaping, property management fees, utility costs to the extent not separately metered, insurance premiums, depreciation of the costs of replacement (as defined below) of the building and improvements in the Development but not including any structural repairs or replacements which are normally chargeable to capital accounts under sound accounting principles, and the Building's share of costs of the Development). The term "operating costs" does not include; (i) costs of alterations of tenants' premises; (ii) costs of curing construction defects; (iii) interest and principal payments on mortgages, and other debt cost; (iv) real estate brokers' , leasing commissions or compensation; (v) any cost or expenditure for which Landlord is reimbursed, whether by insurance proceeds or otherwise; (vi) cost of any service furnished to any other occupant of the Building which Landlord does not provide to tenant hereunder. Structural repairs and replacements are repairs and replacements to the foundations, load-bearing walls, columns and joists and replacement of roofing and roof deck. Notwithstanding anything contained herein to the contrary, depreciation of any capital improvements which are intended to reduce Operating Costs, or are required under any governmental laws, regulations or ordinances which were not applicable to the Building or the Development at the time it was constructed, or are recommended by the N.F.P.A. Life Safety Code, shall be included in Operating Costs. The useful life of any such improvement as well as all non-structural replacements shall be reasonably determined by Landlord. In addition, interest on the undepreciated cost of any such improvement or non-structural replacement (at the prevailing construction loan rate available to Landlord on the date the cost of such improvement was incurred) shall also be included in Operating Costs. If Landlord selects the accrual method of accounting rather than the cash accounting method for Operating Costs purposes, Operating Costs shall be deemed to have been paid when such expenses have accrued. Landlord shall have the right at any time and from time to time to elect, which election shall be subject to revocation, to exclude that portion of Operating Costs attributable to any separately assessed part of the Development and any separate building within the Development. During any period that Operating Costs attributable to any separately assessed part of the Development and/or separate building are so excluded from Operating Costs, then for the purposes of calculating Tenant's proportionate share of Operating Costs as provided in Section 7.02, the denominator shall not include the rentable area of such separately assessed part of the Development and/or such separate building. Landlord may, in a reasonable manner, allocate allocable insurance premiums for so-called "blanket" insurance policies which insure other properties as well as the Development and said allocated amount shall be deemed to be an Operating Cost. If at any time during the term of this lease, the present method of taxation shall be changed so that in lieu of the whole or any part of any taxes, assessments or governmental charges levied, assessed or imposed on real estate and the improvements thereon, there shall be levied, assessed or imposed on Landlord a capital levy or other tax directly on the rents received therefrom and/or a franchise tax, assessment, levy or charge measured by or based, in whole or in part, upon such rents for the present or any future building or buildings on the premises, then all such taxes, assessments, levies or charges, or the part thereof so measured or based, shall be deemed to be included within the term "taxes" for the purposes hereof.

Definition of Operating Costs. The term "“Operating Costs" ” shall mean all costs incurred and expenses paid or incurred expenditures of whatever nature made by Landlord or on Landlord's behalf in connection with the ownership, operation and management, repairfor repair and replacements, replacement, remodeling, cleaning and maintenance and operation of the Development Land, Building and the Common Areas (includingincluding but not limited to any short term parking areas, without limitationloading dock areas and similar parking areas serving the Building from time to time and maintained by Landlord, all assessed real property taxes, assessments (whether general or special) and governmental charges of any kind and nature whatsoever including assessments due to deed restrictions and/or owner's associations, which accrue against the building and/or development of which the premises are a part, not the costs of maintaining and repairing parking lots, parking structures, easements, and landscaping, property management fees, utility costs relating to the extent Parking Facility which shall not separately meteredbe included), insurance premiumsrelated equipment, depreciation of the costs of replacement (as defined below) of the building facilities and improvements in the Development but not including any structural repairs or replacements which are normally chargeable to capital accounts under sound accounting principlesappurtenances, elevators, cooling and heating equipment and the Building's share of costs of the DevelopmentCommon Laboratory Facilities (and services relating thereto). The term "operating costs" does not include; (i) costs of alterations of tenants' premises; (ii) costs of curing construction defects; (iii) interest and principal payments on mortgages, and other debt cost; (iv) real estate brokers' leasing commissions In the event that Landlord or compensation; (v) any cost Landlord’s managers or expenditure agents perform services for which Landlord is reimbursed, whether by insurance proceeds or otherwise; (vi) cost of any service furnished to any other occupant the benefit of the Building or Land off-site which Landlord does not provide to tenant hereunder. Structural repairs would otherwise be performed on-site (e.g., accounting), the cost of such services shall be reasonably allocated among the properties benefiting from such service and replacements are repairs and replacements to the foundations, load-bearing walls, columns and joists and replacement of roofing and roof deck. Notwithstanding anything contained herein to the contrary, depreciation of any capital improvements which are intended to reduce Operating Costs, or are required under any governmental laws, regulations or ordinances which were not applicable to the Building or the Development at the time it was constructed, or are recommended by the N.F.P.A. Life Safety Code, shall be included in Operating Costs. The useful life of any such improvement as well as all non-structural replacements shall be reasonably determined by Landlord. In addition, interest on the undepreciated cost of any such improvement or non-structural replacement (at the prevailing construction loan rate available to Landlord on the date the cost of such improvement was incurred) shall also be included in Operating Costs. If Landlord selects the accrual method of accounting rather than the cash accounting method for Operating Costs purposes, Operating Costs shall be deemed to have been paid when such expenses have accrued. Landlord shall have the right at any time and but not the obligation, from time to time time, to electequitably allocate some or all of the Operating Costs among different tenants of the Building or properties in the Project (the “Cost Pools”), which election including recalculating Tenant’s Proportionate Share with respect to each Cost Pool; provided that such Cost Pools shall apply uniformly to the participants of the applicable Cost Pool(s). Operating Costs shall be subject determined in accordance with generally accepted accounting principles , consistently applied (“GAAP), federal tax basis accounting, or such other method of accounting, consistently applied, as may be reasonably acceptable to revocationLandlord’s lender, all as applicable (e.g., defining capital costs, etc.). Such Cost Pools may include, but shall not be limited to, tenants that share particular systems or equipment (including those relating to exclude the Common Laboratory Facilities) or tenants that portion are similar users of particular systems or equipment such as by way of example but not limitation office space tenants of the Building, research and development tenants of the Building, laboratory tenants of the Building, restaurant tenants of the Building and retail space tenants of the Building. Operating Costs attributable to any separately assessed part shall include, without limitation, those categories of the Development and any separate building within the Development. During any period that Operating Costs attributable to any separately assessed part of the Development and/or separate building are so excluded from “Specifically Included Operating Costs,” as set forth below, then for the purposes of calculating Tenant's proportionate share of Operating Costs as provided in Section 7.02, the denominator but shall not include the rentable area of such separately assessed part of the Development and/or such separate building. Landlord may, in a reasonable manner, allocate insurance premiums for so-called "blanket" insurance policies which insure other properties “Excluded Costs,” as well as the Development and said allocated amount shall be deemed to be an Operating Cost. If at any time during the term of this lease, the present method of taxation shall be changed so that in lieu of the whole or any part of any taxes, assessments or governmental charges levied, assessed or imposed on real estate and the improvements thereon, there shall be levied, assessed or imposed on Landlord a capital levy or other tax directly on the rents received therefrom and/or a franchise tax, assessment, levy or charge measured by or based, in whole or in part, upon such rents for the present or any future building or buildings on the premises, then all such taxes, assessments, levies or charges, or the part thereof so measured or based, shall be deemed to be included within the term "taxes" for the purposes hereofhereinafter defined.

Definition of Operating Costs. The term "Operating Costs" shall mean all costs and expenses paid or incurred by Landlord or on Landlord's Landlord;s behalf in connection with the ownership, management, repair, replacement, remodeling, maintenance and operation of the Development (including, without limitation, all assessed real property taxes, assessments (whether general or special) and governmental charges of any kind and nature whatsoever including assessments due to deed restrictions and/or owner's associations, which accrue against the building and/or development of which the premises are a part, the costs of maintaining and repairing parking lots, lots parking structures, easements, and landscaping, property management fees, utility costs to the extent not separately metered, insurance premiums, depreciation of the costs of replacement (as defined below) of the building and improvements in the Development but not including any structural repairs or replacements which are normally chargeable to capital accounts under sound accounting principles, and the Building's share of costs of the Development). The term "operating costs" does not include; : (i) costs of alterations of tenants' premises; : (ii) costs of curing construction defects; (iii) interest and principal payments on mortgages, and other debt cost; (iv) real estate brokers' leasing commissions or compensation; (v) any cost or expenditure for which Landlord is reimbursed, whether by insurance proceeds or otherwise; (vi) cost of any service furnished to any other occupant of the Building which Landlord does not provide to tenant hereunder. Structural repairs and replacements are repairs and replacements replacement to the foundations, load-bearing walls, columns and joists and replacement of roofing and roof deck. Notwithstanding anything contained herein to the contrary, depreciation of any capital improvements which are intended to reduce Operating Costs, or are required under any governmental laws, regulations or ordinances ordinances, which were not applicable to the Building or the Development at the time it was constructed, or are recommended by the N.F.P.A. Life Lifo Safety Code, shall be included in Operating Costs. The useful life of any such improvement as well as all non-structural replacements shall be reasonably reasonable determined by Landlord. In addition, interest on the undepreciated cost of any such improvement or non-structural replacement (at the prevailing construction loan rate available to Landlord on the date the cost of such improvement was incurred) shall also be included including in Operating Costs. If Landlord selects the accrual method of accounting rather than the cash accounting method for Operating Costs purposes, Operating Costs shall be deemed to have been paid when such expenses have accrued. Landlord shall have the right at any time and from time to time to elect, which election shall be subject to revocation, to exclude that portion of Operating Costs attributable to any separately assessed part of the Development and any separate building within the Development. During any period that Operating Costs attributable to any separately assessed part of the Development and/or separate building are so excluded from Operating Costs, then for the purposes of calculating Tenant's proportionate share of Operating Costs as provided in Section 7.02, the denominator shall not include the rentable area of such separately assessed part of the Development and/or such separate building. Landlord may, in a reasonable manner, allocate insurance premiums for so-called "blanket" insurance policies which insure other properties as well as the Development and said allocated amount shall be deemed to be an Operating Cost. If at any time during the term of this lease, the present method of taxation shall be changed so that in lieu of the whole or any part of any taxes, assessments or governmental charges levied, assessed or imposed on real estate and the improvements thereon, there shall be levied, assessed or imposed on Landlord a capital levy or other tax directly on the rents received therefrom and/or a franchise tax, assessment, levy or charge measured by or based, in whole or in part, upon such rents for the present or any future building or buildings on the premises, then all such taxes, assessments, levies or charges, or the part thereof so measured or based, shall be deemed to be included within the term "taxes" for the purposes hereof.

Definition of Operating Costs. The term (a) "Operating Costs" shall mean are all costs and expenses paid or incurred by Landlord or on Landlord's behalf in connection with the Premises and for its ownership, operation, management, maintenance, repair, restoration and replacement, remodeling, maintenance and operation of the Development (including, without limitation, costs for: services, costs and utilities not otherwise directly paid or reimbursed by Tenant; materials, supplies and equipment; premiums for Landlord's insurance policies and deductibles thereunder; wages and payroll, including bonuses, fringe benefits, workers compensation and payroll taxes (but excluding the foregoing payable to Landlord's partner or chief executive charged with the operation and management of the Premises, currently Xxxxxx Xxxxxx); professional and consulting fees; management fees at the rate of 3.5% of all assessed real property taxesscheduled base rent, assessments Taxes and Operating Costs payable by Tenant (whether general without giving effect to any abatements or specialreductions) and governmental charges utilities and services payable by Tenant (other than those payable by Tenant directly to third-party providers), or at prevailing rates, whichever is greater, or if no managing agent is retained, an amount in lieu thereof not in excess of the greater of the foregoing amounts; complying with any Laws and insurance requirements; environmental matters, including, without limitation, costs of investigations, disclosures, preventive measures, remediation, disposal, audits, monitoring, maintenance and responsive actions; roadway maintenance; costs payable in connection with any easements that benefit or burden the Premises; capital expenditures (excluding those incurred for repairs or rebuilding resulting from a casualty, but including an amount thereof equal to any deductibles under Landlord's casualty insurance policies); an annual audit of Landlord's books and records relating to the Premises and the preparation of Landlord's annual financial statements (but not its tax returns); and snowplowing and landscaping. Operating Costs do not include: Taxes; depreciation of the Premises structures and improvements; Landlord's loan or ground lease payments (including principal payments); costs of negotiating and enforcing leases; brokerage commissions; costs of any kind and nature whatsoever including assessments due to deed restrictions and/or owner's associations, which accrue against the building and/or development of which the premises are a part, the costs of maintaining and repairing parking lots, parking structures, easements, and landscaping, property management fees, utility costs items otherwise includable in Operating Costs to the extent not separately metered, insurance premiums, depreciation of the costs of replacement (as defined below) of the building and improvements in the Development but not including any structural repairs that they are reimbursed under warranties or replacements which are normally chargeable to capital accounts under sound accounting principles, and the Building's share of costs of the Development). The term "operating costs" does not include; (i) costs of alterations of tenants' premises; (ii) costs of curing construction defects; (iii) interest and principal payments on mortgages, and other debt cost; (iv) real estate brokers' leasing commissions or compensation; (v) any cost or expenditure for which Landlord is reimbursed, whether by insurance proceeds or otherwisecondemnation awards; costs for Landlord's California corporate office; costs of Landlord's Work; and costs directly paid or specifically reimbursed by Tenant (vi) cost other than by an allocation of any service furnished to any other occupant of the Building which Landlord does not provide to tenant hereunder. Structural repairs and replacements are repairs and replacements to the foundations, load-bearing walls, columns and joists and replacement of roofing and roof deck. Notwithstanding anything contained herein to the contrary, depreciation of any capital improvements which are intended to reduce Operating Costs, or are required under any governmental laws, regulations or ordinances which were not applicable to the Building or the Development at the time it was constructed, or are recommended by the N.F.P.A. Life Safety Code, shall be included in Operating Costs. The useful life of any such improvement as well as all non-structural replacements shall be reasonably determined by Landlord. In addition, interest on the undepreciated cost of any such improvement or non-structural replacement (at the prevailing construction loan rate available to Landlord on the date the cost of such improvement was incurred) shall also be included in Operating Costs. If Landlord selects the accrual method of accounting rather than the cash accounting method for Operating Costs purposes, Operating Costs shall be deemed to have been paid when such expenses have accrued. Landlord shall have the right at any time and from time to time to elect, which election shall be subject to revocation, to exclude that portion of Operating Costs attributable to any separately assessed part of the Development and any separate building within the Development. During any period that Operating Costs attributable to any separately assessed part of the Development and/or separate building are so excluded from Operating Costs, then for the purposes of calculating Tenant's proportionate share of Operating Costs as provided in Section 7.02, the denominator shall not include the rentable area of such separately assessed part of the Development and/or such separate building. Landlord may, in a reasonable manner, allocate insurance premiums for so-called "blanket" insurance policies which insure other properties as well as the Development and said allocated amount shall be deemed to be an Operating Cost. If at any time during the term of this lease, the present method of taxation shall be changed so that in lieu of the whole or any part of any taxes, assessments or governmental charges levied, assessed or imposed on real estate and the improvements thereon, there shall be levied, assessed or imposed on Landlord a capital levy or other tax directly on the rents received therefrom and/or a franchise tax, assessment, levy or charge measured by or based, in whole or in part, upon such rents for the present or any future building or buildings on the premises, then all such taxes, assessments, levies or charges, or the part thereof so measured or based, shall be deemed to be included within the term "taxes" for the purposes hereof).

Definition of Operating Costs. The term "“Operating Costs" ” shall mean all costs and expenses paid or incurred by Landlord or on Landlord's behalf in connection with the ownership, management, repair, replacement, remodeling, maintenance and operation of the Development (including, without limitation, all assessed real property taxes, assessments assessments, (whether general or special) and governmental charges of any kind and nature whatsoever including assessments due to deed restrictions and/or owner's associations, which accrue against the building and/or development of which the premises are a part, the costs of maintaining and repairing parking lots, parking structures, easements, landscaping, standard garbage removal, termite and landscapingpest control service, property management fees, utility costs to the extent not separately metered, insurance premiums, depreciation of the costs ofcosts of replacement (as defined below) of the building and improvements in the Development but not including any structural repairs or replacements which are normally chargeable to capital accounts under sound accounting principles, and the Building's ' share of costs of the Development). The term "“operating costs" ” does not include; (i) costs of alterations of tenants' premises; (ii) costs of curing construction defects; (iii) interest and principal payments on mortgages, and other debt cost; (iv) real estate brokers' leasing commissions or compensation; (v) any cost or expenditure for which Landlord is reimbursed, whether by insurance proceeds or otherwise; (( vi) cost of any service furnished to any other occupant of the Building which Landlord does not provide to tenant hereunder. Structural repairs and replacements are repairs and replacements to the foundations, load-bearing walls, columns and joists and replacement of roofing and roof deck. Notwithstanding anything contained herein to the contrary, depreciation of any capital improvements which are intended to reduce Operating Costs, or are required under any governmental laws, regulations or ordinances which were not applicable to the Building or the Development at the time it was constructed, or are arc recommended by the N.F.P.A. Life Safety Code, shall be included in Operating Costs. The useful life of any such improvement as well as all non-structural replacements shall be reasonably determined by Landlord. In addition, interest on the undepreciated cost of any such improvement or non-structural replacement (at the prevailing construction loan rate available to Landlord on the date the cost of such improvement was incurred) shall also be included in Operating Costs. If Landlord selects the accrual method of accounting rather than the cash accounting method for Operating Costs purposes, Operating Costs shall be deemed to have been paid when such expenses have accrued. Landlord shall have the right at any time and from time to time to elect, which election shall be subject to revocation, to exclude that portion of Operating Costs attributable to any separately assessed part of the Development and any separate building within the Development. During any period that Operating Costs attributable to any separately assessed part of the Development and/or separate building are so excluded from Operating Costs, Costs then for the purposes of calculating Tenant's proportionate share of Operating Costs as provided in Section 7.02, the denominator shall not include the rentable area arca of such separately assessed part of the Development and/or such separate building. Landlord may, in a reasonable manner, allocate insurance premiums for so-called "“blanket" ” insurance policies which insure other properties as well as the Development and said allocated amount shall be deemed to be an Operating Cost. If at any time during the term of this lease, lease the present method of taxation shall shill be changed so that in lieu lien of the whole or any part of any taxes, assessments assessments, or governmental charges levied, assessed or imposed on real estate and the improvements thereon, there shall be levied, assessed or imposed on Landlord a capital levy or other tax directly on the rents received therefrom and/or a franchise tax, excise tax assessment, levy or charge measured by or based, in whole or in part, upon such rents for the present or any future building or buildings on the premises, then all such taxes, assessments, levies or charges, or the part thereof so measured or based, shall be deemed to be included within the term "“taxes" ” for the purposes hereof.

Definition of Operating Costs. The term "Operating Costs" shall mean all costs and expenses paid or incurred by Landlord or on Landlord's behalf in connection with the ownership, management, repair, replacement, remodeling, maintenance and operation of the Development (including, without limitation, all assessed real property taxes, assessments (whether general or special) and governmental charges of any kind and nature whatsoever including assessments due to deed restrictions and/or owner's associations, which accrue against the building and/or development of which the premises are a part, the costs of maintaining and repairing parking lots, parking structures, easements, and landscaping, property management fees, utility costs to the extent not separately metered, insurance premiums, depreciation of the costs of replacement (as defined below) of the building and improvements in the Development but not including any structural repairs or replacements which are normally chargeable to capital accounts under sound accounting principles, and the Building's share of costs of the Development). The term "operating costs" does not include; : (i) costs of alterations of tenants' premises; (ii) costs of curing construction defects; (iii) interest and principal payments on mortgages, and other debt cost; (iv) real estate brokers' leasing commissions or compensation; (v) any cost or expenditure for which Landlord is reimbursed, whether by insurance proceeds or otherwise; (vi) cost of any service furnished to any other occupant of the Building which Landlord does not provide to tenant hereunder. Structural repairs and replacements are repairs and replacements to the foundations, load-bearing walls, columns and joists and replacement of roofing and roof deck. Notwithstanding anything contained herein to the contrary, depreciation of any capital improvements which are intended to reduce Operating Costs, or are required under any governmental laws, regulations or ordinances which were not applicable to the Building or the Development at the time it was constructed, or are recommended by the N.F.P.A. Life Safety Code, shall be included in Operating Costs. The useful life of any such improvement as well as all non-structural replacements shall be reasonably determined by Landlord. In addition, interest on the undepreciated cost of any such improvement or non-structural replacement (at the prevailing construction loan rate available to Landlord on the date the cost of such improvement was incurred) shall also be included in Operating Costs. If Landlord selects the accrual method of accounting rather than the cash accounting method for Operating Costs purposes, Operating Costs shall be deemed to have been paid when such expenses have accrued. Landlord shall have the right at any time and from time to time to elect, which election shall be subject to revocation, to exclude that portion of Operating Costs attributable to any separately assessed part of the Development and any separate building within the Development. During any period that Operating Costs attributable to any separately assessed part of the Development and/or separate building are so excluded from Operating Costs, then for the purposes of calculating Tenant's proportionate share of Operating Costs as provided in Section 7.02, the denominator shall not include the rentable area of such separately assessed part of the Development and/or such separate building. Landlord may, in a reasonable manner, allocate insurance premiums for so-called "blanket" insurance policies which insure other properties as well as the Development and said allocated amount shall be deemed to be an Operating Cost. If at any time during the term of this lease, the present method of taxation shall be changed so that in lieu of the whole or any part of any taxes, assessments or governmental charges levied, assessed or imposed on real estate and the improvements thereon, there shall be levied, assessed or imposed on Landlord a capital levy or other tax directly on the rents received therefrom and/or a franchise tax, assessment, levy or charge measured by or based, in whole or in part, upon such rents for the present or any future building or buildings on the premises, then all such taxes, assessments, levies or charges, or the part thereof so measured or based, shall be deemed to be included within the term "taxes" for the purposes hereof.