Common use of Lessor Capital Improvements Construction Clause in Contracts

Lessor Capital Improvements Construction. Lessee agrees that Lessor shall have the exclusive right to, and Lessor has agreed to, construct and pay for the Project Improvements in accordance with the Project Management Agreement. Lessor and Lessee agree that total Project Costs are estimated to be Ten Million dollars ($10 million) (“Base Cost”), and that the target completion date of such construction is July 1, 2014. By no later than the 21st day of July 2014, Lessor will provide Lessee with written notice of Project Costs incurred by Lessor for the Project Improvements. Beginning the month of August 2014 and for each month thereafter during the Term, monthly Minimum Rent will increase by one-twelfth of 11.5% of the Project Costs set forth in such notice. If additional Project Costs are incurred by Lessor for the Project Improvements, Lessor will provide Lessee with written notice of such costs by no later than the 21st day of any month, and beginning the next month and for each month thereafter during the Term, monthly Minimum Rent will increase by one-twelfth of 11.5% of the costs set forth in such notice. However, the total amount of Project Costs set forth in all such notices provided under this Section 10.3 shall not exceed the Base Cost, and therefore the total increase in monthly Minimum Rent shall not exceed $95,833 [i.e., ($10 million * 11.5%) / 12]. For the avoidance of doubt, Lessor and Lessee agree that Lessor shall be the owner of, and Lessee shall be the Lessee of, the Project Improvements, which shall be part and parcel of the Terminal System.