Common use of Definition of Operating Expenses Clause in Contracts

Definition of Operating Expenses. As used in this Lease, the term "Operating Expenses" shall mean collectively, the "Project Operating Expenses" and the "Building Operating Expenses." As used herein, "Building Operating Expenses" shall include all costs and expenses for janitorial services for the Building, all costs and expenses for utilities which are separately metered to the Building, and all other costs and expenses of operation and maintenance of the Building as determined by generally accepted accounting principles consistently applied, which Landlord may, from time to time, separately allocate to the Building, all of which shall be calculated assuming the Building is ninety five percent (95%) occupied (or calculated based on the actual level of occupancy for the calendar year in question if the Building is more than ninety five percent (95%) occupied) during such calendar year. As used herein, "Project Operating Expenses" shall include all costs and expenses of operation and maintenance of the Project, as determined by generally accepted accounting principles consistently applied, calculated assuming both buildings in the Project are ninety five percent (95%) occupied (or calculated based on the actual level of occupancy for the calendar year in question if the two (2) buildings in the Project are more than ninety five percent (95%) occupied) during such calendar year, excluding, however, the Building Operating Expenses for the two (2) buildings in the Project. Project Operating Expenses shall include the following costs by way of illustration but not limitation: (a) Real Property Taxes and Assessments (as defined in Subparagraph 6.4 below) and any taxes or assessments imposed in lieu thereof; (b) any and all assessments imposed with respect to the Project pursuant to any covenants, conditions and restrictions affecting the Project and/or the Reciprocal Easement Agreement; (c) water and sewer charges and the costs of electricity, heating, ventilating, air conditioning and other utilities; (d) utilities surcharges and any other costs, levies or assessments resulting from statutes or regulations promulgated by any governmental authority in connection with the use or occupancy of the Project or the parking facilities serving the Project; (e) costs of insurance obtained by Landlord pursuant to Paragraph 23 of this Lease, including any deductibles paid by Landlord; (f) waste disposal and janitorial services; (g) security; (h) labor; (i) costs incurred in the management of the Project, including, without limitation: (1) supplies, (2) wages and salaries (and payroll taxes and similar governmental charges related thereto) of employees used directly in the management, operation and maintenance of the Project, (3) Project management office rental (if such management office is located on the Project) at a cost not to exceed the fair market rental value for such office in comparable suburban Class A office buildings in South Orange County and excluding any portion of such office which is occupied principally for marketing purposes; and

Definition of Operating Expenses. As used in this Lease, the The term "Operating Expensesoperating expenses" shall mean collectively, includes all expenses incurred by Landlord with respect to the "Project Operating Expenses" maintenance and the "Building Operating Expenses." As used herein, "Building Operating Expenses" shall include all costs and expenses for janitorial services for operation of the Building, all costs including, but not limited to, the following: maintenance, repair and expenses replacement costs; electricity, fuel, water, sewer, gas and other common Building utility charges; equipment used for utilities which are separately metered to maintenance and operation of the Building; operational expenses; exterior window washing and janitorial services; trash and snow removal; landscaping and pest control; management fees, wages and all other costs and expenses benefits payable to employees of Landlord whose duties are directly connected with the operation and maintenance of the Building; all services, supplies, repairs, replacements or other expenses for maintaining and operating the Building as determined by generally accepted accounting principles consistently applied, which Landlord may, from time to time, separately allocate or project including parking and common areas; improvements made to the Building, all of Building which shall be calculated assuming are required under any governmental law or regulation that was not applicable to the Building is ninety five percent (95%) occupied (at the time it was constructed; installation of any device or calculated based on other equipment which improves the actual level operating efficiency of occupancy for any system within the calendar year in question if Premises and thereby reduces operating expenses; all other expenses which would generally be regarded as operating, repair, replacement and maintenance expenses; all real property taxes and installments of special assessments, including dues and assessments by means of deed restrictions and/or owners' associations which accrue against the Building is more than ninety five percent (95%) occupied) during such calendar year. As used herein, "Project Operating Expenses" shall include all costs the term of this Lease and expenses of operation and maintenance of legal fees incurred in connection with actions to reduce the Project, as determined by generally accepted accounting principles consistently applied, calculated assuming both buildings in the Project are ninety five percent (95%) occupied (or calculated based on the actual level of occupancy for the calendar year in question if the two (2) buildings in the Project are more than ninety five percent (95%) occupied) during such calendar year, excluding, however, the Building Operating Expenses for the two (2) buildings in the Project. Project Operating Expenses shall include the following costs by way of illustration but not limitation: (a) Real Property Taxes and Assessments (as defined in Subparagraph 6.4 below) and any taxes or assessments imposed in lieu thereofsame; (b) any and all assessments imposed insurance premiums Landlord is required to pay or deems necessary to pay, including fire and extended coverage, and rent loss and public liability insurance, with respect to the Project pursuant Building. Notwithstanding the foregoing, operating expenses shall not include any expenditure which must be capitalized for federal income tax purposes, except that operating expenses shall include the amortization of any such capital expenditures (except capital expenditures for improvements made to the Building without the consent of Tenant, or for restoration or repair of damage to the Building caused by casualty) on a straight-line basis over the reasonably estimated useful life, at an amortization rate equal to the rate of Treasury Securities of comparable term, plus two percent (2%). Further, operating expenses shall not include: A. Taxes payable by reason of any covenants, conditions and restrictions affecting "minimum assessment": or similar agreement to the Project and/or extent exceeding the Reciprocal Easement Agreementtaxes which otherwise would be payable with respect to the property of which the Premises are a part; (c) water and sewer charges and or B. Special assessments levied or pending on the costs date of electricity, heating, ventilating, air conditioning and other utilities; (d) utilities surcharges and any other costs, levies this Lease or assessments resulting from statutes or regulations promulgated by any governmental authority levied for public improvements constructed in connection with the use or occupancy initial construction of the Project Building or any additional building; or C. Expenses of contesting taxes or the parking facilities serving assessed value of the Projectproperty of which the Premises are a part in excess of the savings achieved in such contest; or D. Management fees exceeding fifteen percent (e15%) costs of insurance obtained other operating expenses except taxes and special assessments; or E. Expenses incurred by Landlord pursuant to Paragraph 23 of this Lease, including any deductibles paid by Landlord; (f) waste disposal and janitorial services; (g) security; (h) labor; (i) costs incurred in the management of the Project, including, without limitation: (1) supplies, (2) wages and salaries (and payroll taxes and similar governmental charges related thereto) of employees used directly in the management, operation and maintenance of the Project, (3) Project management office rental (if such management office is located on the Project) at a cost not to exceed the fair market rental value for such office in comparable suburban Class A office buildings in South Orange County and excluding any portion of such office which is occupied principally for marketing purposes; andsatisfying its obligations under Section 14.13 hereof.

Definition of Operating Expenses. As used in this Lease, the term "“Operating Expenses" ” shall mean collectively, the "Project Operating Expenses" and the "Building Operating Expenses." As used herein, "Building Operating Expenses" shall include consist of all costs and expenses for janitorial services for the Buildingof operation, all costs maintenance and expenses for utilities which are separately metered to the Building, and all other costs and expenses of operation and maintenance repair of the Building and Building Common Areas as determined by generally accepted accounting principles principles, consistently applied, which Landlord may, from time to time, separately allocate to the Building, all of which shall be applied and with those Operating Expenses that vary by occupancy calculated assuming the Building is ninety five one hundred percent (95%) occupied (or calculated based on the actual level of occupancy for the calendar year in question if the Building is more than ninety five percent (95100%) occupied) during such calendar year. As used herein, "Project Operating Expenses" shall include together with the Building Percentage of all costs and expenses of operation and maintenance of the Project, Property Common Areas and the Site as determined by generally accepted accounting principles principles, consistently applied, applied and calculated assuming both buildings in the Project are ninety five Property is one hundred percent (95%) occupied (or calculated based on the actual level of occupancy for the calendar year in question if the two (2) buildings in the Project are more than ninety five percent (95100%) occupied) during such calendar year. In the event any facilities, excludingpersonnel, howeverequipment, services, utilities or any other item that may be considered an Operating Expense hereunder and if used or provided in connection with the Building but are also provided or used with any other building owned or operated by Landlord or its affiliates or vice versa, the Building costs incurred by Landlord in connection therewith shall be allocated to Operating Expenses by Landlord on a reasonably equitable basis and consistent with other relevant provisions of this Lease. Landlord will not collect or be entitled to collect Operating Expenses, Insurance Costs, Taxes or Utilities Costs for all of the tenants of the Building in an amount which is in excess of one hundred percent (100%) of the Operating Expenses, Insurance Costs, Taxes and/or Utilities Costs actually paid or incurred by Landlord in connection with the provisions of this Lease. Landlord shall maintain a commensurate level of services for the two (2) buildings Building and Property during the Base Year as was maintained in calendar year 2010 so to as ensure that the Projectlevel of expenses for the Base Year is not artificially low. Project Operating Expenses shall include the following costs by way of illustration but not limitation: (a) Real Property Taxes and Assessments (as defined in Subparagraph 6.4 below) and any taxes or assessments imposed in lieu thereof; (bi) any and all assessments imposed by any authorized sources with respect to the Project Building, Common Areas, and/or Site pursuant to any covenants, conditions and restrictions affecting the Project and/or the Reciprocal Easement AgreementProperty; (cii) water and sewer charges and the costs of electricity, heating, ventilating, air conditioning and other utilities; (d) utilities surcharges and any other costs, levies or assessments resulting from statutes or regulations promulgated by any governmental government authority in connection with the use or occupancy of the Project Site, Building or the Premises or the parking facilities serving the ProjectSite, Building or the Premises; (e) costs of insurance obtained by Landlord pursuant to Paragraph 23 of this Lease, including any deductibles paid by Landlord; (fiii) waste disposal and janitorial services; (giv) security; (h) labor; (iv) costs incurred in the management of the ProjectSite, Building and Common Areas, including, without limitation: (1) supplies, materials, equipment and tools, (2) wages wages, salaries, benefits, pension payments, fringe benefits, uniforms and salaries dry-cleaning thereof (and payroll taxes taxes, insurance and similar governmental charges related thereto) of employees used directly in the management, operation and maintenance of the ProjectSite, Building and Common Areas (to the level of senior Property manager adjusted on a commercially reasonable pro rata allocation for employees directly associated with the operation and maintenance of the Site, Building and Common Areas), (3) Project the rental of personal property used by Landlord’s personnel in the maintenance, repair and operation of the Property, (4) commercially reasonable management office rental expenses including rent and operating costs, (5) accounting fees, legal fees and real estate consultant’s fees, and (6) a management/administrative fee which shall be comparable to the then prevailing market management fee expressed as a percentage of annual gross receipts for comparable third party management companies offering comparable management services in Comparable Buildings, but in no event greater than four percent (4%) of the gross revenues of the Building; (vi) repair and maintenance of the elevators, if such management office is located any, and the structural portions of the Building, including the plumbing, heating, ventilating, air-conditioning and electrical systems installed or furnished by Landlord; (vii) maintenance, costs and upkeep of all parking and Common Areas; (viii) amortization on a straight-line basis over the useful life determined in accordance with generally accepted accounting principles on the Projectunamortized balance of all costs of a capital nature (including, without limitation, capital improvements, capital replacements, capital repairs, capital equipment and capital tools): (1) at reasonably intended to produce a cost not reduction in operating charges or energy consumption, but only to exceed the fair market rental value for such office in comparable suburban Class A office buildings in South Orange County and excluding any portion extent of such office established savings on a year to year basis; or (2) required after the date of this Lease under any Law that was not applicable to the Building as of the date of this Lease (such costs, collectively, “Allowable Capital Costs”); (ix) costs and expenses of gardening and landscaping; (x) maintenance of signs (other than signs of tenants of the Site); (xi) personal property taxes levied on or attributable to personal property used by Landlord in connection with the Building, the Common Areas and/or the Site; and (xii) costs and expenses of repairs, resurfacing, repairing, maintenance, painting, lighting, cleaning, refuse removal, security and similar items. Operating Expenses shall not include Taxes, Insurance Costs or Utilities Costs which is occupied principally shall be separately accounted for marketing purposes; andunder the terms of this Lease, nor shall Operating Expenses include any of the exclusions from Operating Expenses set forth in subsection (j) hereof.

Definition of Operating Expenses. As used The term "Operating Expenses" shall -------------------------------- mean (i) all of Landlord's direct costs and expenses of operation, repair and maintenance of the Buildings, the Property and supporting facilities, as determined by Landlord in this Leaseaccordance with generally accepted accounting principles or other recognized accounting principles, consistently applied; (ii) costs, or a portion thereof, properly allocable to the Buildings or Property of any capital improvements made to the Buildings or Property by Landlord which comprise labor-saving devices or other equipment intended to improve the operating efficiency of any system within the Buildings or Property (such as an energy management computer system) to the extent of cost savings in Operating Expenses as a result of the device or equipment, as reasonably determined by Landlord; and (iii) costs properly allocable to the Buildings or Property of any capital improvements made to the Buildings or Property by Landlord that are required under any governmental law or regulation that was not applicable to the Buildings and Property at the time they were constructed, or that are reasonably required for the health and safety of tenants in the Property or Buildings, the costs, or allocable portion thereof, to be amortized over the useful life of such item as Landlord shall reasonably determine, together with interest upon the unamortized balance at the "Prime Rate" as is published in the Wall Street Journal (or such reasonable substitute prime rate as Landlord may reasonably select) at the time such expense is incurred plus two percent (2%) or such higher rate as may have been paid by Landlord on funds borrowed for the purpose of constructing the capital improvements. The term "Operating Expenses" shall include the costs of all utilities (including surcharges) for the Property and Buildings; the cost of all insurance which Landlord or Landlord's lender deems necessary for the Property and Buildings; a reasonable management fee; dues imposed by any property owner's association ("Association"); and the Real Property Taxes (as defined in subsection 5(f)). If Landlord elects to self-insure or includes the Property under blanket insurance policies covering multiple properties, then the term "Operating Expenses" shall mean collectively, include the "Project Operating Expenses" and the "Building Operating Expenses." As used herein, "Building Operating Expenses" shall include all costs and expenses for janitorial services for the Building, all costs and expenses for utilities which are separately metered to the Building, and all other costs and expenses of operation and maintenance portion of the Building as determined by generally accepted accounting principles consistently applied, which Landlord may, from time to time, separately allocate to the Building, all cost of which shall be calculated assuming the Building is ninety five percent (95%) occupied (such self-insurance or calculated based on the actual level of occupancy for the calendar year in question if the Building is more than ninety five percent (95%) occupied) during such calendar year. As used herein, "Project Operating Expenses" shall include all costs and expenses of operation and maintenance of the Project, as determined by generally accepted accounting principles consistently applied, calculated assuming both buildings in the Project are ninety five percent (95%) occupied (or calculated based on the actual level of occupancy for the calendar year in question if the two (2) buildings in the Project are more than ninety five percent (95%) occupied) during such calendar year, excluding, however, the Building Operating Expenses for the two (2) buildings in the Project. Project Operating Expenses shall include the following costs by way of illustration but not limitation: (a) Real Property Taxes and Assessments (as defined in Subparagraph 6.4 below) and any taxes or assessments imposed in lieu thereof; (b) any and all assessments imposed with respect to the Project pursuant to any covenants, conditions and restrictions affecting the Project and/or the Reciprocal Easement Agreement; (c) water and sewer charges and the costs of electricity, heating, ventilating, air conditioning and other utilities; (d) utilities surcharges and any other costs, levies or assessments resulting from statutes or regulations promulgated by any governmental authority in connection with the use or occupancy of the Project or the parking facilities serving the Project; (e) costs of blanket insurance obtained allocated by Landlord pursuant to Paragraph 23 of this Lease, including any deductibles paid by Landlord; (f) waste disposal and janitorial services; (g) security; (h) labor; (i) costs incurred in the management of the Project, including, without limitation: (1) supplies, (2) wages and salaries (and payroll taxes and similar governmental charges related thereto) of employees used directly in the management, operation and maintenance of the Project, (3) Project management office rental (if such management office is located on the Project) at a cost not to exceed the fair market rental value for such office in comparable suburban Class A office buildings in South Orange County and excluding any portion of such office which is occupied principally for marketing purposes; andProperty.

Definition of Operating Expenses. As used in this Lease, the term "“Operating Expenses" ” shall mean collectively, the "Project Operating Expenses" and the "Building Operating Expenses." As used herein, "Building Operating Expenses" shall include consist of all costs and expenses for janitorial services for incurred or reasonably reserved (based on the Buildingreasonable practices of landlord’s of Comparable Properties) by or on behalf of Landlord in connection with the ownership, all costs operation, maintenance, repair and expenses for utilities which are separately metered to the Building, and all other costs and expenses of operation and maintenance replacement of the Southern Building and Common Areas as determined by generally accepted standard accounting principles consistently applied, which Landlord may, from time to time, separately allocate to the Building, all of which shall be calculated assuming the Building is ninety five percent (95%) occupied (or calculated based on the actual level of occupancy for the calendar year in question if the Building is more than ninety five percent (95%) occupied) during such calendar year. As used herein, "Project Operating Expenses" shall include all costs and expenses of operation and maintenance of the Project, as determined by generally accepted accounting principles consistently applied, calculated assuming both buildings in the Project are ninety five percent (95%) occupied (or calculated based on the actual level of occupancy for the calendar year in question if the two (2) buildings in the Project are more than ninety five percent (95%) occupied) during such calendar year, excluding, however, the Building Operating Expenses for the two (2) buildings in the Project. Project Operating Expenses shall include practices including the following costs by way of illustration but not limitation: (a) Real Property Taxes and Assessments (as defined in Subparagraph 6.4 Section 6.3 below) and any taxes or assessments imposed in lieu thereof; (b) any and all assessments imposed with respect to the Southern Building, Land Common Areas and/or Project pursuant to any covenants, conditions and restrictions (“CCR’s) affecting the Project and/or Project, Common Areas or Southern Building including, but not limited to, the Reciprocal Easement AgreementCCR’s for the Business Park (“CCR Assessments”); (c) water and sewer charges and the costs of electricity, heating, ventilating, air conditioning HVAC and other utilities, excluding those which are furnished to the Demised Premises and other leased premises within the Southern Building which are separately metered and paid separately by the tenants, including Tenant (provided that Tenant’s Percentage thereof shall be reduced to reflect any portion of the Demised Premises that is separately metered); (d) utilities surcharges and any other costs, levies or assessments resulting from statutes or regulations promulgated by any governmental government authority in connection with the use or occupancy of the Project Southern Building, Land or the Demised Premises or the parking facilities serving the ProjectSouthern Building, Land or Demised Premises; (e) costs of insurance obtained by Landlord pursuant to Paragraph 23 Article VII of this Lease, including any deductibles paid by LandlordLease to the extent allocable to the Southern Building; (f) waste disposal and janitorial services; (g) security; (h) labor; (i) costs incurred in the management of the ProjectSouthern Building, Land and Common Areas, including, without limitation: (1) supplies, (2) wages and salaries (and payroll taxes and similar governmental charges related thereto) of employees used directly in the management, operation and maintenance of the Southern Building, Land and Common Areas, and (2) a management/administrative fee not to exceed 2.5 percent (2.5%) of the annual base rent of the Southern Building; (i) supplies, materials, equipment and tools to the extent used with respect to the Project; (j) repair and maintenance of the elevators and any other Building Systems and Equipment installed or furnished by Landlord; (k) maintenance costs and upkeep of all Common Areas (including, but not limited to, the Workout Facility); (l) amortization on a straight-line basis over the actual useful life together with interest at ten percent (10%) per annum on the unamortized balance of all costs of a capital nature (including, without limitation, capital improvements, capital replacements, capital repairs, capital equipment and capital tools): (l) reasonably intended to produce a reduction in Operating Expenses or energy consumption; or (2) required after the date of this Lease under any governmental law or regulation that was not applicable to the Southern Building at the time they were originally constructed; or (3) Project management office rental for repair or replacement of any equipment or improvements needed to operate and/or maintain the Southern Building, Land, and/or the Common Areas, provided, however, to the extent Landlord has previously reserved funds for any such capital item, Landlord shall first apply such reserved funds against the cost of such capital item; (if such management office is located on m) maintenance of signs (other than signs of tenants of the Project); (n) at a personal property taxes levied on or attributable to personal property used in connection with the Southern Building, Land, and/or the Common Areas; and (o) costs and expenses of repairs, resurfacing, repairing, maintenance, painting, lighting, cleaning, refuse removal and similar items; provided, however, in no event shall Landlord include within Operating Expenses the cost for resurfacing or replacing the parking areas more than once every five (5) years (further provided, however, that such limitations shall not be deemed to exceed include the fair market rental value for such office in comparable suburban Class A office buildings in South Orange County and excluding any portion cost of reslurring, patching and/or restriping of such office which is occupied principally parking areas as and when reasonably necessary). Notwithstanding the foregoing, for marketing purposes; andpurposes of this Lease, Operating Expenses shall not, however, include:

Definition of Operating Expenses. As used in this Lease, the The term "Operating Expenses" shall mean collectively-------------------------------- includes all expenses incurred by, Landlord with respect to the maintenance and operation of the Building and all Landlord's personal property used in connection therewith, including, but not limited to, the "Project Operating Expenses" following: (1) maintenance, repair and replacement costs; (2) electricity, fuel, water, sewer, gas and other utility charges; (3) security, window washing, janitorial services, trash and snow removal; (4) landscaping and pest control; (5) management fees, wages and fringe benefits payable to employees of Landlord, or of any management agent of Landlord whose duties are directly connected with the "Building Operating Expenses." As used herein, "Building Operating Expenses" shall include all costs and expenses for janitorial services for the Building, all costs and expenses for utilities which are separately metered to the Building, and all other costs and expenses of operation and maintenance of the Building; (6) all services, supplies, repairs, replacements or other expenses for maintaining and operating the Building as determined or Project including parking or common areas; (7) the cost, including interest, amortized over its useful life, of any capital improvement made to the Building by generally accepted accounting principles consistently appliedLandlord after the date of this Agreement which is required under any governmental law or regulation that was not applicable to the Building at the time it was constructed; (8) the cost, which Landlord mayincluding interest, from time amortized over its useful life, of installation of any device or other equipment designed to time, separately allocate to improve the operating efficiency of any system within the Building, but limited to the amount of any actual operating efficiencies; (9) all other expenses which would generally be regarded as operating and maintenance expenses which would reasonably be amortized over a period not to exceed five years; (10) all real property and personal property taxes and installments of special assessments, including dues and assessments by means of deed restrictions and/or owners' associations which shall be calculated assuming accrue against the Building is ninety five percent (95%) occupied (or calculated based on during the actual level Term of occupancy for the calendar year in question if the Building is more than ninety five percent (95%) occupied) during such calendar year. As used hereinthis Agreement and federal, "Project Operating Expenses" shall include all costs state and expenses of operation and maintenance of the Project, as determined by generally accepted accounting principles consistently applied, calculated assuming both buildings in the Project are ninety five percent (95%) occupied (or calculated based on the actual level of occupancy for the calendar year in question if the two (2) buildings in the Project are more than ninety five percent (95%) occupied) during such calendar year, excluding, however, the Building Operating Expenses for the two (2) buildings in the Project. Project Operating Expenses shall include the following costs by way of illustration but not limitation: (a) Real Property Taxes and Assessments (as defined in Subparagraph 6.4 below) and any local taxes or assessments imposed in lieu thereofcharges assessed against the Building, whether special, general or extraordinary (except for Income or franchise taxes applicable against Landlord); (b11) any and all assessments imposed with respect insurance premiums Landlord is required to the Project pursuant pay or deems necessary to any covenants, conditions and restrictions affecting the Project and/or the Reciprocal Easement Agreement; (c) water and sewer charges and the costs of electricity, heating, ventilating, air conditioning and other utilities; (d) utilities surcharges and any other costs, levies or assessments resulting from statutes or regulations promulgated by any governmental authority in connection with the use or occupancy of the Project or the parking facilities serving the Project; (e) costs of insurance obtained by Landlord pursuant to Paragraph 23 of this Lease, including any deductibles paid by Landlord; (f) waste disposal and janitorial services; (g) security; (h) labor; (i) costs incurred in the management of the Projectpay, including, without limitation, public liability insurance, with respect to the Building; (12) all Building services costs, and (13) Landlord's reasonable allocation of a portion of such costs, expenses, taxes, assessments and premiums which relate to the Project as a whole and are not specifically allocated to any building within the Project. The term Operating Expenses does not include the following: (1) suppliesrepairs, restoration or other work occasioned by fire, wind, the elements or other casualty; (2) wages income and salaries (and payroll franchise taxes and similar governmental charges related thereto) of employees used directly in the management, operation and maintenance of the Project, Landlord; (3) Project management office rental expenses incurred in leasing to or procuring of tenants, leasing commissions, advertising expenses and expenses for the renovating of space for new tenants; (if such management office is located 4) interest or principal payments on any mortgage or other indebtedness of Landlord; (5) compensation paid to any employee of Landlord above the Projectgrade of property manager; (6) at a cost not to exceed any depreciation allowance or expenses; or (7) operating expenses which are the fair market rental value for such office responsibility of Tenant or any other Tenant in comparable suburban Class A office buildings in South Orange County and excluding any portion of such office which is occupied principally for marketing purposes; andthe building.

Definition of Operating Expenses. As used in this Lease, the term "“Operating Expenses" ” shall mean collectively, the "Project Operating Expenses" and the "Building Operating Expenses." As used herein, "Building Operating Expenses" shall include consist of all costs and expenses for janitorial services for the Building(paid or incurred) of operation, all costs ownership, maintenance, repair and expenses for utilities which are separately metered to the Building, and all other costs and expenses of operation and maintenance replacement of the Building Project and the Common Areas as determined by generally accepted Landlord utilizing standard accounting principles consistently applied, which Landlord may, from time to time, separately allocate to the Building, all of which shall be practices calculated assuming the Building Project is ninety five percent (95%) occupied (or calculated based on the actual level of occupancy for the calendar year in question if the Building is more than ninety ninety-five percent (95%) occupied) during such calendar year. As used herein, "Project Operating Expenses" shall include all costs and expenses of operation and maintenance If the occupancy of the Project, as determined by generally accepted accounting principles consistently applied, calculated assuming both buildings in the Project are ninety during any part of any Lease Year is less than ninety-five percent (95%) occupied (or calculated based on ), Landlord shall make an appropriate adjustment of the actual level variable components of occupancy Operating Expenses for that Lease Year, as reasonably determined by Landlord using sound accounting and management principles, to determine the calendar year in question if amount of Operating Expenses that would have been incurred had the two (2) buildings in the Project are more than ninety Project, as applicable, been ninety-five percent (95%) occupied) during such calendar year, excluding, however, . This amount shall be considered to have been the Building amount of Operating Expenses for the two (2) buildings that Lease Year. For purposes of this Section 4.4, “variable components” include only those component expenses that are affected by variations in the Projectoccupancy levels. Project Operating Expenses shall include the following costs by way of illustration but not limitation: (a) Real Property Taxes and Assessments (as defined in Subparagraph 6.4 Section 4.5 below) and any taxes or assessments imposed in lieu thereof; (b) any and all assessments imposed with respect to the Project pursuant to any covenants, conditions and restrictions affecting the Project and/or the Reciprocal Easement AgreementProject; (c) except to the extent paid by Tenant as part of Electricity Utility Charges (as defined in Section 16.2 below), water, pure water and sewer charges and the costs of electricity, heating, ventilating, air conditioning and other utilities; (d) except to the extent paid by Tenant as part of Electricity Utility Charges, utilities surcharges and any other costs, levies or assessments resulting from statutes or regulations promulgated by any governmental government authority in connection with the use or occupancy of the Project or the parking facilities serving the Project; (e) costs of insurance obtained by Landlord pursuant to Paragraph 23 to, or contemplated by, Section 21 of this Lease, including Lease and any deductibles paid by thereunder and including Landlord’s costs of any self insurance deductible or retention; (f) except to the extent paid by Tenant as part of Electricity Utility Charges, waste disposal and janitorial services; (g) security; (h) labor; (i) costs incurred in the management of the ProjectProject , including, without limitation: (1) supplies, (2) wages wages, salaries, benefits, pension payments, fringe benefits, uniforms and salaries dry-cleaning thereof (and payroll taxes taxes, insurance and similar governmental charges related thereto) of employees used directly in the managementoperation, operation management and maintenance of the Project, (3) Project the rental of personal property used by Landlord’s personnel in the maintenance, repair and operation of the Project, (4) management office expenses including rent, office supplies, materials therefor and operating costs, (5) accounting fees, legal fees and real estate consultant’s fees, and (6) a management/administrative fee; (i) supplies, materials, equipment and tools; (j) repair, replacement and maintenance of the elevators, the structural portions of the Project, the plumbing, heating, ventilating, air-conditioning, electrical and other utility systems installed or furnished by Landlord; (k) maintenance, costs and upkeep of all parking and Common Areas; (I) amortization on a straight-line basis over the useful life (as reasonably determined by Landlord), together with interest at the Interest Rate (as defined in Section 1.14 of the Summary of this Lease) on the unamortized balance of all costs of a capital nature (including, without limitation, capital improvements, capital replacements, capital repairs, capital equipment and capital tools): (1) intended to produce a reduction in operating charges or energy consumption or effect other economies in the operation or maintenance of the Project; or (2) required under any and all applicable laws, statutes, codes, ordinances, orders, rules, regulations, conditions of approval and requirements of all federal, state, county, municipal and governmental authorities and all administrative or judicial orders or decrees and all permits, licenses, approvals and other entitlements issued by governmental entities, and rules of common law, relating to or affecting the Project or any part thereof or the use or operation thereof, whether now existing or hereafter enacted, including, without limitation, the Americans with Disabilities Act of 1990, 42 U.S.C. 12111 et seq. (the “ADA”) as the same may be amended from time to time, all Environmental Laws (as hereinafter defined), and any covenants, conditions and restrictions or any corporation, committee or association formed in connection therewith, or any supplement thereto recorded in any official or public records with respect to the Project or any portion thereof (collectively, “Applicable Laws”); (3) for repair or replacement of any equipment or improvements needed to operate and/or maintain the Project at the same quality levels as prior to the repair or replacement; or (4) which are reasonably determined by Landlord to be in the best interests of the Project; provided, however, that all costs of a capital nature which do not exceed $10,000 shall be fully expensed when incurred; (m) costs and expenses of gardening and landscaping; (n) maintenance of signs; (o) personal property taxes levied on or attributable to personal property used in connection with the Project; (p) license, permit and inspection fees; (q) legal, accounting, inspection and consultation fees incurred in connection the operation of the Project; and (r) costs and expenses of repairs, resurfacing, degreasing, washing, repairing, maintenance, painting, lighting, cleaning, refuse removal, security and similar items, including appropriate reserves. For purposes of determining Landlord’s Contribution to Operating Expenses, Operating Expenses shall not include (i) one-time special assessments, charges, costs or fees or extraordinary charges or costs incurred in the Base Year only, (ii) market-wide labor-rate increases due to extraordinary circumstances including, but not limited to, boycotts and strikes, (iii) utility rate increases due to extraordinary circumstances including, but not limited to, conservation surcharges, boycotts, embargoes or other shortages, and (iv) costs of any capital items or amortization of any capital items including, but not limited to, capital improvements, capital repairs and capital replacements (including such amortized costs where the actual improvement, repair or replacement was made in prior years). If in any calendar year subsequent to the Base Year, the amount of Operating Expenses decreases due to a reduction in the cost of providing utilities, security and/or other services to the Project for any reason, including without limitation, because of deregulation of the utility industry and/or reduction in rates achieved in contracts with utilities and/or service providers, then for purposes of the calendar year in which such decrease in Operating Expenses occurred and all subsequent calendar years, the Operating Expenses for the Base Year shall be decreased by an amount equal to such decrease. Notwithstanding anything to the contrary contained herein, Operating Expenses in any year subsequent to the Base Year shall always be deemed to be at least equal to the aggregate Operating Expenses in the Base Year. Notwithstanding anything to the contrary contained herein, Operating Expenses shall not include the following: (i) advertising and leasing commissions; (ii) repairs and restoration to the extent paid for by the proceeds of any insurance policies or amounts to the extent otherwise reimbursed by a third party to Landlord or to the extent paid by any other third party source (other than by tenants paying their share of Operating Expenses), net of collection costs; (iii) Project financing costs, ground lease rental or depreciation; (iv) the cost of special services to Project tenants for which a special charge is made; (v) the costs of repair of casualty damage or for restoration following condemnation to the extent reimbursed by insurance proceeds or condemnation awards (net of collection costs); (vi) the costs, including permit costs and supervision fees, incurred for the installation of tenant improvements; (vii) the legal fees and related expenses incurred by Landlord (together with any damages awarded against Landlord) due to Landlord’s or any tenant’s bad faith violation of any Project lease; (viii) costs incurred: (A) to comply with Applicable Laws with respect to any Hazardous Materials (as hereinafter defined) which were in existence in, on, under or about the Project (or any portion thereof) prior to the date hereof, and were of such a nature that a federal, state or municipal governmental or quasi-governmental authority, if it had then had knowledge of the presence of such Hazardous Materials, in the state, and under the conditions that they then existed in, on, under or about the Project, would have then required the removal, remediation or other action with respect thereto; and/or (B) with respect to Hazardous Materials which are disposed of or otherwise introduced into, on, under or about the Project after the date hereof by Landlord or Landlord’s agents or employees and are of such a nature, at time of disposition or introduction, that a federal, state or municipal governmental or quasi-governmental authority, if it had then had knowledge of the presence of such Hazardous Materials, in the state, and under the conditions, that they then existed in, on, under or about the Project, would have then required the removal, remediation or other action with respect thereto; provided, however, Operating Expenses shall include costs incurred in connection with the clean-up, remediation, monitoring, management and administration of (and defense of claims related to) the presence of (1) Hazardous Materials used by Landlord (provided such use is not negligent and is in compliance with Applicable Laws) in connection with the operation, repair and maintenance of the Project to perform Landlord’s obligations under this Lease (such as, without limitation, fuel oil for generators, cleaning solvents, and lubricants) and which are customarily found or used in office buildings and (2) Hazardous Materials created, released or placed in the Premises, Building or the Project by Tenant (or Tenant’s affiliates or their tenants, contractors, employees or agents) prior to or after the date hereof; (ix) the attorneys’ fees incurred for negotiating and preparing letters of intent, leases, subleases and/or assignments, space planning costs, and other costs incurred for lease, sublease and/or assignment negotiations and transactions with present or prospective Project tenants or occupants; (x) the expenses for services or other benefits which are not available to Tenant (other than as the result of an Event of Default); (xi) the overhead and profit paid to Landlord or its subsidiaries or affiliates for goods and/or services to the extent the same exceeds the costs of such goods and/or services rendered by qualified, third parties on a competitive basis; (xi) the costs arising from Landlord’s charitable or political contributions; (xiii) the costs (other than ordinary maintenance and insurance) for objects of art; (n) the interest and penalties resulting from Landlord’s failure to pay Operating Expense when due; (xiv) Landlord’s general corporate overhead and general and administrative expenses, and costs for the operation of the entity which constitutes Landlord as the same are distinguished from the costs of the operation of the Project, including accounting and legal matters, costs of defending any lawsuits with any mortgagee, costs of selling or mortgaging Landlord’s interest in the Project, costs of any disputes between Landlord and its employees (if any) not engaged in Project operation, disputes of Landlord with management, or outside fees paid for disputes with other Project tenants or occupants (except to the extent such dispute is based on Landlord’s good faith efforts to meet Landlord’s obligations under this Lease); (xv) the costs arising from the gross negligence or willful misconduct of Landlord; and (xvi) the management office is located on rent to the extent it exceeds fair market rent for such space. Landlord shall have the right, from time to time, to equitably allocate some or all of the Operating Expenses between the Building and/or among different tenants of the Project and/or different buildings of the Project as and when such different buildings are constructed and added to (and/or excluded from) the Project or otherwise (the “Cost Pools”). Such Cost Pools may include, without limitation, the office space tenants and industrial space tenants of the Project or of a building or buildings in the Project) at a cost not . Such Cost Pools may also include an allocation of certain Operating Expenses within or under covenants, conditions and restrictions affecting the Project. In addition, Landlord shall have the right from time to exceed the fair market rental value for such office time, in comparable suburban Class A office its reasonable discretion, to include or exclude existing or future buildings in South Orange County the Project for purposes of determining Operating Expenses and/or the provision of various services and excluding amenities thereto, including allocation of Operating Expenses in any portion of such office which is occupied principally for marketing purposes; andCost Pools.

Definition of Operating Expenses. As used in this Lease, the The term "Operating Expensesoperating expenses" shall mean collectively, includes all expenses incurred by Landlord with respect to the "Project Operating Expenses" maintenance and the "Building Operating Expenses." As used herein, "Building Operating Expenses" shall include all costs and expenses for janitorial services for operation of the Building, all costs including, but not limited to, the following: maintenance, repair and expenses replacement costs; electricity, fuel, water, sewer, gas and other common Building utility charges for utilities which are separately metered to the common areas; equipment used for maintenance and operation of the Building; operational expenses; exterior window washing and janitorial services (for common areas); trash and snow removal; landscaping and pest control; reasonable management fees, wages and all other costs and expenses benefits payable to employees of Landlord whose duties are directly connected with the operation and maintenance of the Building; all services, supplies, repairs, replacements or other expenses for maintaining and operating the Building as determined by generally accepted accounting principles consistently appliedand appurtenant improvements, which Landlord may, from time to time, separately allocate including parking and common areas; improvements made to the Building, all of Building which shall be calculated assuming are required under any governmental law or regulation that was not applicable to the Building is ninety five percent (95%) occupied (at the time it was constructed; installation of any device or calculated based on other equipment which improves the actual level operating efficiency of occupancy for any system within the calendar year in question if the Building is more than ninety five percent (95%) occupied) during such calendar year. As used hereinPremises and thereby reduces operating expenses; all other expenses which would generally be regarded as operating, "Project Operating Expenses" shall include all costs and expenses of operation repair, replacement and maintenance expenses; all real property taxes and installments of special assessments (excluding special assessments levied prior to the Project, as determined by generally accepted accounting principles consistently applied, calculated assuming both buildings in the Project are ninety five percent (95%) occupied (or calculated based on the actual level of occupancy for the calendar year in question if the two (2) buildings in the Project are more than ninety five percent (95%) occupied) during such calendar year, excluding, however, the Building Operating Expenses for the two (2) buildings in the Project. Project Operating Expenses shall include the following costs by way of illustration but not limitation: (a) Real Property Taxes and Assessments (as defined in Subparagraph 6.4 belowCommencement Date) and any taxes or assessments imposed legal fees incurred in lieu thereofconnection with actions to reduce the same; (b) any and all assessments imposed insurance premiums Landlord is required to pay or reasonably deems necessary to pay, including fire and extended coverage, and rent loss and public liability insurance, with respect to the Project pursuant Building. The following items shall not constitute nor be included in operating expenses: debt service, leasing commissions, executive salaries and overhead, non-cash charges or reserves, costs to any covenantscorrect defects in design or original construction, conditions or costs which are reimbursed by others (except tenant payments of pro rata shares of operating expenses). For the years 1995, 1996 and restrictions affecting 1997, the Project and/or the Reciprocal Easement Agreement; Tenant's pro rata share of operating expenses shall be capped at One and no/100 Dollars (c$1.00) water per square foot per year, and sewer charges One and the costs of electricity20/100 Dollars ($1.20) per square foot per year, heatingand Three and 75/100 Dollars ($3.75) per square foot per year, ventilating, air conditioning and other utilities; (d) utilities surcharges and any other costs, levies or assessments resulting from statutes or regulations promulgated by any governmental authority in connection with the use or occupancy of the Project or the parking facilities serving the Project; (e) costs of insurance obtained by Landlord pursuant to Paragraph 23 of this Lease, including any deductibles paid by Landlord; (f) waste disposal and janitorial services; (g) security; (h) labor; (i) costs incurred in the management of the Project, including, without limitation: (1) supplies, (2) wages and salaries (and payroll taxes and similar governmental charges related thereto) of employees used directly in the management, operation and maintenance of the Project, (3) Project management office rental (if such management office is located on the Project) at a cost not to exceed the fair market rental value for such office in comparable suburban Class A office buildings in South Orange County and excluding any portion of such office which is occupied principally for marketing purposes; andrespectively.

Definition of Operating Expenses. As used in this LeaseThe term "operating expenses" includes all expenses incurred by Lessor with respect to the maintenance and operation of the building of which the leased premises are a part, including, but not limited to, the term "Operating Expenses" shall mean collectivelyfollowing: maintenance, repair and replacement costs; security; management fees, wages and benefits payable to employees of Lessor whose duties are directly connected with the "Project Operating Expenses" and the "Building Operating Expenses." As used herein, "Building Operating Expenses" shall include all costs and expenses for janitorial services for the Building, all costs and expenses for utilities which are separately metered to the Building, and all other costs and expenses of operation and maintenance of the Building as determined by generally accepted accounting principles consistently appliedbuilding; all services, which Landlord mayutilities, from time to timesupplies, separately allocate repairs, replacements, or other expenses for maintaining and operating the common parking and plaza areas; the cost, including interest, amortized over its useful life, of any capital improvement made to the Buildingbuilding by Lessor after the date of this Lease which is required under any governmental law or regulation that was not applicable to the building at the time it was constructed; the cost, including interest, amortized over its useful life, of installation of any device or other equipment which improves the operating efficiency of any system within the leased premises and thereby reduces operating expenses; all other expenses which would generally be regarded as operating and maintenance expenses which would reasonably be amortized over a period not to exceed five years; all real property taxes and installments of special assessments, including dues and assessments by means of deed restrictions and/or owners' associations which accrue against the building of which shall be calculated assuming the Building is ninety five percent (95%) occupied (or calculated based on leased premises are a part during the actual level term of occupancy for the calendar year in question if the Building is more than ninety five percent (95%) occupied) during such calendar year. As used herein, "Project Operating Expenses" shall include all costs and expenses of operation and maintenance of the Project, as determined by generally accepted accounting principles consistently applied, calculated assuming both buildings in the Project are ninety five percent (95%) occupied (or calculated based on the actual level of occupancy for the calendar year in question if the two (2) buildings in the Project are more than ninety five percent (95%) occupied) during such calendar year, excluding, however, the Building Operating Expenses for the two (2) buildings in the Project. Project Operating Expenses shall include the following costs by way of illustration but not limitation: (a) Real Property Taxes and Assessments (as defined in Subparagraph 6.4 below) and any taxes or assessments imposed in lieu thereofthis Lease; (b) any and all assessments imposed insurance premiums Lessor is required to pay or deems necessary to pay, including public liability insurance, with respect to the Project pursuant building. The term operating expenses does not include the following: repairs, restoration or other work occasioned by fire, wind, the elements of other casualty; income and franchise taxes of Lessor; expenses incurred in leasing to or procuring of lessees, leasing commissions, advertising expenses and expenses for the renovating of space for new, leasing commissions, advertising expenses and expenses for the renovating of space for new lessees; interest or principal payments on any mortgage or other indebtedness of Lessor; compensation paid to any covenants, conditions and restrictions affecting employee or Lessor above the Project and/or the Reciprocal Easement Agreementgrade of property manager; (c) water and sewer charges and the costs of electricity, heating, ventilating, air conditioning and other utilitiesany depreciation allowance or expense; (d) utilities surcharges and any other costs, levies or assessments resulting from statutes or regulations promulgated operating expenses assumed hereunder by any governmental authority in connection with the use or occupancy of the Project or the parking facilities serving the Project; (e) costs of insurance obtained by Landlord pursuant to Paragraph 23 of this Lease, including any deductibles paid by Landlord; (f) waste disposal and janitorial services; (g) security; (h) labor; (i) costs incurred in the management of the Project, including, without limitation: (1) supplies, (2) wages and salaries (and payroll taxes and similar governmental charges related thereto) of employees used directly in the management, operation and maintenance of the Project, (3) Project management office rental (if such management office is located on the Project) at a cost not to exceed the fair market rental value for such office in comparable suburban Class A office buildings in South Orange County and excluding any portion of such office which is occupied principally for marketing purposes; andLessee.

Definition of Operating Expenses. As used in this Lease, the The term "“Operating Expenses" shall mean collectively, ” includes all expenses incurred by Landlord with respect to the "Project Operating Expenses" maintenance and the "Building Operating Expenses." As used herein, "Building Operating Expenses" shall include all costs and expenses for janitorial services for operation of the Building, all costs including, but not limited to, the following: maintenance, repair and expenses replacement costs; electricity, fuel, water, sewer, gas and other common Building utility charges; equipment used for utilities which are separately metered to maintenance and operation of the Building; operational expenses; exterior window washing and janitorial services; trash and snow removal; landscaping and pest control; management fees, wages and all other costs and expenses benefits payable to employees of Landlord whose duties are directly connected with the operation and maintenance of the Building; all services, supplies, repairs, replacements or other expenses for maintaining and operating the Building or project including parking and common areas; improvements made to the Building which are required under any governmental law or regulation that was not applicable to the Building at the time it was constructed; installation of any device or other equipment which improves the operating efficiency of any system within the Premises and thereby reduces Operating Expenses; all other expenses which would generally be regarded as determined operating, repair, replacement and maintenance expenses; all real property taxes and installments of special assessments, including dues and assessments by means of deed restrictions and/or owner’s association which accrue against the Building during the term of this Lease and legal fees incurred in connection with actions to reduce the same; and all insurance premiums Landlord is required to pay or deems necessary to pay, including fire and extended coverage, and rent loss and public liability insurance. Notwithstanding the foregoing, Operating Expenses shall not include the following: i. repairs or other work occasioned by fire, windstorm or other casualty, to the extent that the costs thereof are reimbursed to Landlord by insurers, or would have been reimbursed had the insurance required hereunder been maintained, or by governmental authorities in eminent domain; ii. leasing commission, attorneys’ fees and other expenses incurred in connection with negotiations or disputes with tenants, or prospective tenants of the Building; iii. costs incurred in renovating or otherwise improving or decorating or redecorating space for tenants in the Building or other space leased or held for lease in the Building; iv. Landlord’s costs of utilities, janitorial and other services sold to tenants for which Landlord is entitled to be reimbursed by tenants; v. Depreciation and amortization; vi. Costs which under generally accepted accounting principles principles, consistently applied, which Landlord maymust be capitalized, from time and such costs shall be amortized over there useful life, not to timeexceed fifteen (15) years, separately allocate at 10% interest; vii. Interest on debt or amortization payments on any mortgage or mortgages, and rental under any ground or underlying lease or leases; viii. The cost of changes to the Building, all of which shall be calculated assuming parking structure, or the Building is ninety five percent (95%) occupied (appurtenances in compliance with any laws, statutes, ordinances, rules or calculated based on the actual level of occupancy for the calendar year in question if the Building is more than ninety five percent (95%) occupied) during such calendar year. As used herein, "Project Operating Expenses" shall include all costs and expenses of operation and maintenance of the Project, as determined by generally accepted accounting principles consistently applied, calculated assuming both buildings in the Project are ninety five percent (95%) occupied (or calculated based on the actual level of occupancy for the calendar year in question if the two (2) buildings in the Project are more than ninety five percent (95%) occupied) during such calendar year, excluding, however, the Building Operating Expenses for the two (2) buildings in the Project. Project Operating Expenses shall include the following costs by way of illustration but not limitation: (a) Real Property Taxes and Assessments (as defined in Subparagraph 6.4 below) and any taxes or assessments imposed in lieu thereof; (b) any and all assessments imposed with respect directives enacted prior to the Project pursuant to any covenantsCommencement Date; and ix. Any charges for ground leases or other underlying leases, conditions and restrictions affecting the Project and/or the Reciprocal Easement Agreement; (c) water and sewer charges and the costs of electricity, heating, ventilating, air conditioning and other utilities; (d) utilities surcharges and easements or any other similar or dissimilar use fees or other costs, levies or assessments resulting from statutes or regulations promulgated by any governmental authority in connection with the use or occupancy of the Project or the parking facilities serving the Project; (e) costs of insurance obtained by Landlord pursuant to Paragraph 23 of this Lease, including any deductibles paid by Landlord; (f) waste disposal and janitorial services; (g) security; (h) labor; (i) costs incurred in the management of the Project, including, without limitation: (1) supplies, (2) wages and salaries (and payroll taxes and similar governmental charges related thereto) of employees used directly in the management, operation and maintenance of the Project, (3) Project management office rental (if such management office is located on the Project) at a cost not to exceed the fair market rental value for such office in comparable suburban Class A office buildings in South Orange County and excluding any portion of such office which is occupied principally for marketing purposes; and.

Definition of Operating Expenses. As used in this Lease, the The term "Operating Expensesoperating expenses" shall mean collectively, includes all reasonable expenses incurred by Landlord with respect to the "Project Operating Expenses" maintenance and the "Building Operating Expenses." As used herein, "Building Operating Expenses" shall include all costs and expenses for janitorial services for operation of the Building, all costs including, but not limited to, the following: maintenance, repair and expenses replacement costs; electricity, fuel, water, sewer, gas and other common Building utility charges; equipment used for utilities which are separately metered to maintenance and operation of the Building; operational expenses; exterior window washing and janitorial services; trash and snow removal; landscaping and pest control; management fees not to exceed three percent (3%) of gross rents (exclusive of the amortization of the Tenant Improvement Allowance depicted in sections 6.2 and 6.3), wages and all other costs and expenses benefits payable to employees of Landlord whose duties are directly connected with the operation and maintenance of the Building; all services, supplies, repairs, replacements or other expenses for maintaining and operating the Building as determined by generally accepted accounting principles consistently applied, which Landlord may, from time to time, separately allocate or project including parking and common areas; improvements made to the Building, all of Building which shall be calculated assuming are required under any governmental law or regulation that was not applicable to the Building is ninety five percent (95%) occupied (at the time it was constructed; installation of any device or calculated based on other equipment which improves the actual level operating efficiency of occupancy for any system within the calendar year in question if Premises and thereby reduces operating expenses; all other expenses which would generally be regarded as operating, repair, replacement and maintenance expenses; all real property taxes and installments of special assessments, including dues and assessments by means of deed restrictions and/or owners' associations which accrue against the Building is more than ninety five percent (95%) occupied) during such calendar year. As used herein, "Project Operating Expenses" shall include all costs the term of this Lease and expenses of operation and maintenance of legal fees incurred in connection with actions to reduce the Project, same so long as determined by generally accepted accounting principles consistently applied, calculated assuming both buildings in the Project are ninety five percent (95%) occupied (or calculated based on the actual level of occupancy for the calendar year in question if the two (2) buildings in the Project are more than ninety five percent (95%) occupied) during such calendar year, excluding, however, the Building Operating Expenses for the two (2) buildings in the Project. Project Operating Expenses shall include the following costs by way of illustration but not limitation: (a) Real Property Taxes and Assessments (as defined in Subparagraph 6.4 below) and any taxes or assessments imposed in lieu thereofreduction associated with said action accrues to Tenant; (b) any and all assessments imposed insurance premiums Landlord is required to pay or deems necessary to pay, including fire and extended coverage, and rent loss and public liability insurance, with respect to the Project pursuant to Building. Roof replacements shall be amortized over the useful life of the roof. Parking lot replacements shall be recovered in the year the work was performed so long as no more than 20% of the Parking area is replaced in one calendar year. The cost of Parking lot replacement involving replacement of in excess of 20% of the parking area in any covenantsyear shall be amortized over the useful life of the replacement. Notwithstanding the above, conditions and restrictions affecting Landlord agrees that the Project and/or total cost of operating expenses including property taxes for the Reciprocal Easement Agreement; (c) water and sewer charges and building shall not exceed the costs of electricity, heating, ventilating, air conditioning and other utilities; (d) utilities surcharges and any other costs, levies or assessments following during the calendar years 1998-2000: CALENDAR YEAR OPERATING EXPENSES 1998 $329,000.00 1999 $342,400.00 2000 $356,100.00 Provided that increases in property taxes resulting from statutes or regulations promulgated by any governmental authority in connection with the use or occupancy addition of the Project or fifth floor shall not be subject to the parking facilities serving cap, and shall be recoverable as operating expenses without regard to the Project; (e) costs of insurance obtained by Landlord pursuant to Paragraph 23 of this Lease, including any deductibles paid by Landlord; (f) waste disposal and janitorial services; (g) security; (h) labor; (i) costs incurred in the management of the Project, including, without limitation: (1) supplies, (2) wages and salaries (and payroll taxes and similar governmental charges related thereto) of employees used directly in the management, operation and maintenance of the Project, (3) Project management office rental (if such management office is located on the Project) at a cost not to exceed the fair market rental value for such office in comparable suburban Class A office buildings in South Orange County and excluding any portion of such office which is occupied principally for marketing purposes; andcap.

Definition of Operating Expenses. As used in this LeaseThe term “Operating Expenses” includes all expenses incurred by Landlord with respect to the maintenance and operation of the Building of which the Premises are a part, including, but not limited to, the term "Operating Expenses" shall mean collectivelyfollowing: maintenance, repair and replacement costs; electricity, fuel, water, sewer, gas and other common Building utility charges; signage; security system charges; security, window washing and janitorial services; trash and snow removal; lawn mowing, landscaping and pest control; management fees (not to exceed 5% of the "Project Operating Expenses" and the "Building Operating Expenses." As used herein, "Building Operating Expenses" shall include all costs and expenses for janitorial services for gross rental income of the Building), all costs reasonable wages and expenses for utilities which benefits payable to employees of Landlord whose duties are separately metered to directly connected with the Building, and all other costs and expenses of operation and maintenance of the Building; all services, supplies, repairs, replacements or other expenses for maintaining and operating the Building or project including parking and common areas; improvements made to the Building which are required under any governmental law or regulation that was not applicable to the Building at the time it was constructed; installation of any device or other equipment or capital improvement which improves the operating efficiency of any system within the Premises and thereby reduces Operating Expenses; any and all necessary replacements of the roof, structural portions of the Building, foundation and HVAC equipment done by Landlord and reimbursed by Tenant as determined additional rent, provided however said costs shall be amortized over the useful life of such replaced item according to GAAP; and all other expenses which would generally be regarded as operating, repair, replacement and maintenance expenses, all real property taxes and installments of special assessments (payable over the longest time period available), including dues and assessments by generally accepted accounting principles consistently appliedmeans of deed restrictions and/or owners associations which accrue against the Building during the term of this Lease and reasonable legal fees incurred in connection with actions to reduce the same; and all insurance premiums Landlord is required to pay or deems necessary to pay, which Landlord mayincluding fire and extended coverage, from time to timerent loss and public liability insurance, separately allocate with respect to the Building, all of which shall be calculated assuming the Building is ninety five percent (95%) occupied (or calculated based on the actual level of occupancy for the calendar year in question if the Building is more than ninety five percent (95%) occupied) during such calendar year. As used herein, "Project Operating Expenses" shall include all costs and expenses of operation and maintenance of the Project, as determined by generally accepted accounting principles consistently applied, calculated assuming both buildings in the Project are ninety five percent (95%) occupied (or calculated based on the actual level of occupancy for the calendar year in question if the two (2) buildings in the Project are more than ninety five percent (95%) occupied) during such calendar year, excluding, however, the Building Operating Expenses for the two (2) buildings in the Project. Project Operating Expenses shall not include the following costs by way of illustration but not limitation: (a) Real Property Taxes and Assessments (as defined in Subparagraph 6.4 below) and any taxes or assessments imposed in lieu thereofcosts of alterations of the premises of other tenants of the Building; (b) any and all assessments imposed with respect costs of capital improvements to the Project pursuant to any covenants, conditions and restrictions affecting the Project and/or the Reciprocal Easement AgreementBuilding or Property except as expressly stated above; (c) water and sewer charges and the costs of electricity, heating, ventilating, air conditioning and other utilitiesdepreciation charges; (d) utilities surcharges interest and any other costs, levies principal payments on mortgages or assessments resulting from statutes or regulations promulgated by any governmental authority in connection with security agreements concerning the use or occupancy of the Project or the parking facilities serving the ProjectBuilding; (e) costs of insurance obtained by Landlord pursuant to Paragraph 23 of this Lease, including any deductibles paid by Landlordreal estate leasing and brokerage commissions; and (f) waste disposal and janitorial services; (g) security; (h) labor; (i) costs incurred in the management of the Projectany expenditure for which Landlord has been reimbursed by insurance, including, without limitation: (1) supplies, (2) wages and salaries (and payroll taxes and similar governmental charges related thereto) of employees used directly in the management, operation and maintenance of the Project, (3) Project management office rental (if such management office is located on the Project) at a cost not to exceed the fair market rental value for such office in comparable suburban Class A office buildings in South Orange County and excluding any portion of such office which is occupied principally for marketing purposes; andjudgment award or other means.

Definition of Operating Expenses. As used in this Lease, the term "“Operating Expenses" ” shall mean collectively, the "Project Operating Expenses" and the "Building Operating Expenses." As used herein, "Building Operating Expenses" shall include consist of all costs and expenses for janitorial services for of operation, maintenance, repair and replacement (subject to the terms hereof) of the Project (including the Building, all costs the Site and expenses for utilities which are separately metered to the Building, and all other costs and expenses of operation and maintenance of the Building Common Areas) as determined by generally accepted accounting principles consistently applied, which Landlord may, from time to time, separately allocate to the Building, all of which shall be (“GAAP”) and calculated assuming the Building Project is ninety five percent (95%) occupied (or calculated based on the actual level of occupancy for the calendar year in question if the Building is more than ninety ninety-five percent (95%) occupied) during such calendar year. As used herein, "Project Operating Expenses" shall include together with the Building’s Share of all costs and expenses of operation for the operation, maintenance, repair and maintenance replacement of the Project, Project and the Project Common Areas as determined by generally accepted accounting principles consistently applied, Landlord utilizing GAAP and calculated assuming both buildings in the Project are ninety five percent (95%) occupied (or calculated based on the actual level of occupancy for the calendar year in question if the two (2) buildings in the Project are more than ninety is ninety-five percent (95%) occupied) during such calendar year, excluding, however. The term “Building’s Share” shall mean a fraction, the numerator of which is the rentable square footage of the Building Operating Expenses for and the two (2) buildings in denominator of which is the rentable square footage of the Project. Project Operating Expenses shall include the following costs by way of illustration but not limitation: (a) Real Property Taxes and Assessments (as defined in Subparagraph 6.4 Section 4.5 below) and any taxes or assessments imposed in lieu thereof; (b) any and all assessments imposed with respect to the Project Building, Common Areas, and/or Site pursuant to any covenants, conditions and restrictions affecting the Project and/or the Reciprocal Easement AgreementSite, Common Areas or Building; (c) to the extent not charged to and paid by Tenant pursuant to Section 16.2 below, water and sewer charges and the costs of electricity, heating, ventilating, air conditioning and other utilities; (d) to the extent not charged to and paid by Tenant pursuant to Section 16.2 below, utilities surcharges and any other costs, levies or assessments resulting from statutes or regulations promulgated by any governmental government authority in connection with the use or occupancy of the Project Site, Building or the Premises or the parking facilities serving the ProjectSite, Building or the Premises; (e) costs of insurance obtained by Landlord pursuant to Paragraph 23 Section 21 of this Lease, including any deductibles paid by Landlord; (f) waste disposal and janitorial services; (g) securitysecurity (if any); (h) labor; (i) costs incurred in the management of the ProjectSite, Building and Common Areas, including, without limitation: (1) supplies, (2) wages wages, salaries (but not above the level of Project manager), benefits, pension payments, fringe benefits, uniforms and salaries dry-cleaning thereof (and payroll taxes, unemployment taxes, employer’s Social Security taxes, together with any other taxes levied on wages, salaries, compensation and benefits, insurance and similar governmental charges related thereto) of employees used directly in the management, operation and maintenance of the ProjectSite, Building and Common Areas, (3) Project the rental of personal property used by Landlord’s personnel in the maintenance, repair and operation of the Project, (4) management office rental expenses including rent and operating costs, (if such management office is located on 5) accounting fees directly related to the Project, legal fees directly related to the Project and real estate consultant’s fees, and (6) at a cost management/administrative fee substantially consistent with that charged by landlords of Comparable Buildings, but in any event not to exceed four percent (4%) of the fair market rental value gross revenues of the Project; (i) supplies, materials, equipment and tools; (j) repair and maintenance of the elevators and the structural portions of the Building, including the plumbing, heating, ventilating, air-conditioning, electrical and other utility systems installed or furnished by Landlord; (k) maintenance, costs and upkeep of all parking and Common Areas; (l) amortization on a straight-line basis over the useful life (as reasonably determined by Landlord), together with interest at the Interest Rate (as defined in Section 1.14 of the Summary of this Lease) on the unamortized balance of all costs of a capital nature (including, without limitation, capital improvements, capital replacements, capital repairs, capital equipment and capital tools): (1) reasonably intended to produce a reduction in operating charges or energy consumption or effect other economies in the operation or maintenance of the Project (but only to the extent of the cost savings that result therefrom and with Landlord to provide, upon Tenant’s written request, backup information regarding the basis for Landlord’s reasonable belief in such reduction in operating expenses); or (2) required after the date of this Lease under any governmental law or regulation that was not in effect as of the Commencement Date; or (3) for repair or replacement of any equipment or improvements needed to operate and/or maintain the Building, the Common Areas and/or the Site at the same quality levels as prior to the repair or replacement; (m) costs and expenses of gardening and landscaping; (n) maintenance of signs; (o) personal property taxes levied on or attributable to personal property used in connection with the Building, the Common Areas and/or the Site; and (p) costs and expenses of repairs, resurfacing, repairing, maintenance, painting, lighting and similar items, including appropriate reserves. If Landlord is not furnishing any particular work or service (the cost of which, if performed by Landlord, would be included in Operating Expenses) to a tenant who has undertaken to perform such work or service in lieu of the performance thereof by Landlord, Operating Expenses shall be deemed to be increased by an amount equal to the additional Operating Expenses which would reasonably have been incurred during such period by Landlord if it had at its own expense furnished such work or service to such tenant. For purposes of determining Landlord’s Contribution to Operating Expenses, Operating Expenses shall not include (i) one-time special assessments, charges, costs or fees or extraordinary charges or costs incurred in the Base Year only, (ii) market-wide labor-rate increases due to extraordinary circumstances including, but not limited to, boycotts and strikes, (iii) utility rate increases due to extraordinary circumstances including, but not limited to, conservation surcharges, boycotts, embargoes or other shortages. As provided in Section 4.5 below, the Base Year shall be fully assessed for purposes of Real Property Taxes and Assessments. Landlord shall have the right, from time to time, to equitably allocate some or all of the Operating Expenses between the Building and/or among different tenants of the Project and/or different buildings of the Project as and when such different buildings are constructed and added to (and/or excluded from) the Project or otherwise (the “Cost Pools”). Such Cost Pools may include, without limitation, the office space tenants and industrial space tenants of the Project or of a building or buildings in the Project. Such Cost Pools may also include an allocation of certain Operating Expenses within or under covenants, conditions and restrictions affecting the Project. In addition, Landlord shall have the right from time to time, in its reasonable discretion, to include or exclude existing or future buildings in the Project for purposes of determining Operating Expenses and/or the provision of various services and amenities thereto, including allocation of Operating Expenses in any such Cost Pools. Landlord hereby agrees that the cost of any new type or increased amount of insurance coverage (including, but not limited to, earthquake insurance) (or increased limits of insurance or decrease in the amount of deductibles) which is obtained or effected by Landlord during any calendar year after the Base Year (but is not obtained or effected during the Base Year) shall be added to the Operating Expenses for the Base Year (but at the rate which would have been in effect during the Base Year or the rate in effect during such subsequent calendar year, whichever is lower) prior to the calculation of Tenant’s Share of Operating Expenses for each such calendar year in which such change in insurance is initially obtained or effected. In the event that any of Landlord’s insurance premiums applicable to the Project shall decrease in any calendar year subsequent to the Base Year (including, without limitation, as a result of any decrease in the amount or type of coverage or increase in deductibles), Operating Expenses attributable to the Base Year, shall, commencing the year of such decrease, but only as long as and to the extent such decrease remains in effect, thereafter be reduced by the amount of such decrease in the insurance premiums. Landlord further agrees that any costs incurred in any calendar year after the Base Year because of any added new type of discretionary services which were readily available during the Base Year, and customarily provided by landlords of Comparable Buildings during the Base Year (but not by Landlord), and not included in the Base Year shall be added to and included in the Base Year for purposes of determining the Operating Expenses payable for such office calendar year in comparable suburban Class A office buildings which such added new type of discretionary services are so provided, as if such services were provided in South Orange County the Base Year (but at the rate for such services which would have been in effect during the Base Year, or the rate in effect during such subsequent calendar year, whichever is lower); provided, however, the foregoing provision shall not apply to the costs of any capital additions, capital alterations, capital repairs or capital improvements which shall be governed by the provisions of Section 4.4 above. In addition, if in the event and excluding to the extent any portion of the Project is covered by a warranty or service agreement which provides warranty-type protection at any time during the Base Year and is not covered by such office which is occupied principally warranty or such warranty-type protection under such service agreement in a subsequent calendar year to the same extent, Operating Expenses for marketing purposes; andthe Base Year shall be deemed increased by the amount Landlord would have incurred during the Base Year with respect to the items or matters covered by the subject warranty or warranty-type protection, had such warranty or such service agreement not been in effect during the Base Year. Notwithstanding anything in the definition of Operating Expenses set forth above, Operating Expenses shall not include the following: