Non-Economic Facilities Clause Samples
The Non-Economic Facilities clause defines the types of facilities or services provided under a contract that do not have a direct monetary value or are not tied to financial compensation. Typically, this clause outlines amenities such as access to meeting rooms, parking spaces, or use of common areas, which are offered as part of the agreement but are not separately billed. Its core practical function is to clarify which benefits are included for the parties beyond financial terms, ensuring both sides understand the full scope of what is provided and reducing the risk of disputes over entitlements.
Non-Economic Facilities. If the Gross Revenues of any Facility are insufficient to pay all Facility Expenses and the Base Fee for such Facility in full during each of two (2) consecutive calendar years (commencing with calendar year 2016), Manager shall be entitled, upon thirty (30) days notice to the relevant TRS, to designate such Facility as a “Non-Economic Facility.” Notwithstanding the foregoing, Manager shall not be entitled, without the relevant Owner’s consent, to designate a Facility for which Invested Capital exceeds twenty percent (20%) of Aggregate Invested Capital as a Non-Economic Facility, nor shall Manager be entitled to designate a Facility as a Non-Economic Facility at any time that there are less than six (6) Facilities subject to this Agreement. For purposes of this Section 5.02 only, Aggregate Invested Capital shall be determined without giving effect to the termination of the Management Agreement for a Non-Economic Facility and without reduction for proceeds from the sale, or deemed sale, of any Non-Economic Facility. Manager may request an increase in the foregoing twenty percent (20%) threshold at any time, which the relevant Owner may accept or reject in its sole discretion. For the purposes of this Section 5.02, any payment of Facility Expenses and Base Fees with respect to a Facility under a Management Agreement and (but without duplication) of Aggregate Facility Expenses and Aggregate Base Fees allocated to a Facility under (and as defined in) a prior pooling agreement, in either case, made during calendar year 2016 prior to the Effective Date, will be taken into account in determining whether the Gross Revenues of any Facility have been insufficient to pay all Facility Expenses and the Base Fee for such Facility in full for calendar year 2016. Manager shall market a Facility designated as a Non-Economic Facility for sale and any costs incurred by Manager in connection with such marketing activities and the sale of such Facility shall be paid out of the net proceeds of such sale. The relevant TRS and Owner shall cooperate with Manager in compiling any relevant information, preparing marketing materials and otherwise in connection with the sale of a Non-Economic Facility.
Non-Economic Facilities. If the Gross Revenues of any Facility are insufficient to pay all Facility Expenses and the Base Fee of such Facility in full during each of two (2) consecutive calendar years, Manager shall, upon thirty (30) days notice to the relevant TRS, be entitled to designate such Facility a “Non-Economic Facility.” Notwithstanding the foregoing, Manager shall not be entitled without the Owner’s consent to designate Facilities for which the Invested Capital in the aggregate would exceed twenty percent (20%) of Aggregate Invested Capital and further provided for purposes of this Section 5.02 only, Aggregate Invested Capital shall be determined without giving effect to the termination of the Management Agreement of a Non-Economic Facility and without reduction for proceeds from the sale, or deemed sale, of any Non-Economic Facility. Manager may request an increase in the foregoing twenty percent (20%) threshold at any time, which Owner may accept or reject in its sole discretion. Manager shall market a Facility designated as a Non-Economic Facility for sale and any costs incurred by the Manager in connection with such marketing activities and the sale of such Facility shall be paid out of the net proceeds of such sale. The relevant TRS and Owner shall cooperate with Manager in compiling any relevant information, preparing marketing materials and otherwise in connection with the sale of a Non-Economic Facility.