Operating Costs. Tenant shall, for the entire Term, pay to Landlord as an item of additional rent, without any setoff or deduction therefrom, its Proportionate Share of costs ("Operating Costs") which Landlord may incur in maintaining and operating the Project during each calendar year of the Term. "Proportionate Share" is defined as the decimal equivalent of a fraction, the numerator of which is the rentable area of the Premises and the denominator of which is the rentable area within the entire Building. "Operating Costs" are defined to include all reasonable expenses and costs (but not specific costs which are separately billed to and paid by individual tenants, including Tenant) which the Landlord shall pay or become obligated to pay because of or in connection with the operation and maintenance of the Project and supporting facilities of the Project, including but not limited to all real estate taxes and annual installments of special assessments payable in such calendar year with respect to the Project; costs of any contest of such taxes, including reasonable attorney's fees; management fees (except that no management fee shall be charged during such period(s) that Tenant elects to maintain and manage the common areas pursuant to Section 10), insurance premiums, utility costs, security costs, costs of wages, maintenance costs (relating to the Project including sidewalks, landscaping and parking or service areas, common areas, service contracts, equipment and supplies) and all other costs of any nature whatsoever which for federal tax purposes may be expensed rather than capitalized, all in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, costs of leasehold improvements and payments of principal and interest on any mortgages, deeds of trusts, or other security devices covering the Project. Operating Costs shall also include the yearly amortization of capital costs incurred by the Landlord for improvements or structural repairs to the Project required to comply with any change after the commencement date in the laws, rules or regulations of any governmental authority having jurisdiction, or for purposes of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building components), which costs shall be amortized over the useful life of such improvements or repairs, as reasonably estimated by the Landlord, but in no event in excess of the savings. The management fee shall not exceed 3% of Tenant's Base Rent and Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site manager, any administrative or overhead expenses, any special assessments or charges in the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with or as a consequence of the development of the Project. As soon as reasonably practicable prior to the commencement of each calendar year during the Term, Landlord shall furnish to Tenant an estimate of Operating Costs for the ensuing calendar year and Tenant's Proportionate Share thereof. Tenant shall pay, as additional rent hereunder together with each installment of Base Rent, one-twelfth (1/12th) of its estimated annual Proportionate Share of Operating Costs. As soon as reasonably practicable after the end of each calendar year during the Term and in any event within 120 days, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share of Operating Costs, and within thirty (30) days thereafter Tenant shall pay to Landlord, or Landlord shall credit to the next rent payments due Landlord from Tenant, as the case may be, any difference between the actual Operating Costs and the estimated Operating Costs paid by Tenant. Tenant's Proportionate Share of Operating Costs for the years in which this Lease commences and terminates shall be prorated by multiplying the actual Operating Costs by a fraction the numerator of which is the number of days of that year of the Term and the denominator of which is 365. Notwithstanding any other provision herein to the contrary, it is agreed that in the event that the Project is not fully occupied at any time during the Term, an adjustment shall be made in computing the management fee component of the Operating Costs for such year so that the management fee component of the Operating Costs shall be computed for such year as though the Project had been fully occupied during such year. For a period of three (3) years following Tenant's receipt of Landlord's statement of actual Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in the offices where Landlord maintains its accounting records. No subtenant will have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result of the audit.
Appears in 1 contract
Samples: Lease Agreement (Angeion Corp/Mn)
Operating Costs. Tenant shall, for the entire Term, pay to Landlord as an item of additional rent, without any setoff or deduction therefrom, its Proportionate Share of costs ("“Operating Costs") which ” means any expenses, costs, and disbursements of any kind other than Taxes, paid or incurred by Landlord may incur in maintaining and operating the Project during each calendar year of the Term. "Proportionate Share" is defined as the decimal equivalent of a fraction, the numerator of which is the rentable area of the Premises and the denominator of which is the rentable area within the entire Building. "Operating Costs" are defined to include all reasonable expenses and costs (but not specific costs which are separately billed to and paid by individual tenants, including Tenant) which the Landlord shall pay or become obligated to pay because of or in connection with the operation ownership, insuring (including, without limitation, terrorism coverage), management, maintenance, operation, and maintenance repair of the Project and supporting facilities all or any part of the Project, including but not limited to all real estate taxes and annual installments of special assessments payable the personal property, fixtures, machinery, equipment, systems, and apparatus used in such calendar year with respect to the Project; costs of any contest of such taxesconnection therewith, including reasonable attorney's fees; management fees (except that no management fee shall the cost of providing those services required to be charged during such period(s) that Tenant elects to maintain and manage the common areas pursuant to Section 10), insurance premiums, utility costs, security costs, costs of wages, maintenance costs (relating to the Project including sidewalks, landscaping and parking or service areas, common areas, service contracts, equipment and supplies) and all other costs of any nature whatsoever which for federal tax purposes may be expensed rather than capitalized, all in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, costs of leasehold improvements and payments of principal and interest on any mortgages, deeds of trusts, or other security devices covering the Projectfurnished by Landlord under this Lease. Operating Costs shall also include the yearly amortization not include: (a) costs of alterations of tenant premises; (b) costs of capital costs incurred by the Landlord for improvements or structural repairs improvements, except those intended, in good faith, to reduce Operating Costs, and those made to keep the Project required in compliance with Laws (as hereinafter defined) and other governmental requirements applicable from time to comply with any change after time, the commencement date in the laws, rules or regulations costs of any governmental authority having jurisdiction, or for purposes of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building components), which costs shall be amortized over by Landlord in accordance with sound accounting and management principles; (c) interest and principal payments on mortgages or any other debt costs, or rental payments on any ground lease of the useful life Project (“Ground Lease”); (d) real estate brokers’ leasing commissions; (e) any cost or expenditure for which Landlord is reimbursed, by insurance proceeds or otherwise, to the extent of such improvements reimbursement, except by Operating Cost Share Rent; (f) the cost of any service furnished to any office tenant of the Project which Landlord does not make available to Tenant; (g) the cost of repair to the Building, including the Premises, to the extent the cost of such repairs is reimbursed by insurance or repairscondemnation proceeds; (h) the cost of improving or renovating rentable space for tenants (including Tenant) or rentable space vacated by any tenant (including Tenant); (i) the cost of utilities charged to individual tenants (including Tenant) and payroll, material and contract costs of other services charged to tenants (including Tenant), other than as reasonably estimated part of additional rent under such tenants’ leases or this Lease; (j) the cost of painting and decorating the Premises or premises of other tenants; (k) depreciation of the Building and other real property structures in the Project; (l) legal and other related expenses associated with the negotiation or enforcement of leases or the defense of (1) Landlord’s title to the Land, the Building, or other portions of the Project, or (2) any action based solely on an alleged breach by Landlord of a lease pertaining to space within the Building; (m) advertising costs incurred directly for leasing individual space in the Building or other portions of the Project; (n) Landlord’s general corporate overhead, including salaries of officers or other employees of Landlord above the level of Building manager, and Landlord’s general administrative expenses to the extent not directly related to the operation of the Project; (o) any compensation paid to clerks, attendants, or other persons in commercial concessions operated by Landlord; (p) all items and services for which Tenant or any other tenant in the Project reimburses Landlord, other than as part of additional rent under such tenants’ leases or this Lease; (q) amounts paid to any party, including a division or affiliate of Landlord, providing materials, services, labor, or equipment to the extent that such amounts materially exceed the reasonable competitive costs of such materials, services, labor, or equipment when provided by an independent party in an arm’s-length transaction, but only to the extent of such excess; (r) any costs, fines, or penalties imposed due to Landlord’s negligence or willful misconduct; (s) costs of acquiring sculpture, paintings, or works of art; (t) costs of correcting structural and other defects in no event in excess the initial construction of the savings. The management fee shall not exceed 3% of Tenant's Base Rent and Operating Costs Project (determined including, without reference to any management fee limitation, latent defects) or taxes and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site manager, any administrative or overhead expenses, any special assessments or charges in the nature Project equipment; (u) expenses and costs relating in any way whatsoever to the identification, testing, monitoring, control, encapsulation, removal, replacement, repair, and abatement of any Hazardous Materials (as hereinafter defined) within the Project to the extent caused by or in lieu attributable to the acts or omissions of assessments which are now levied or pending or which are hereafter imposed or levied Landlord; (v) all costs and expenses incurred in connection with or as a consequence of relating to any retail space in the development of the Project. As soon as reasonably practicable prior Project to the commencement extent there is a direct charge for such costs and expenses to such retail space tenants, other than as part of each calendar year additional rent under such tenants’ leases; (w) repairs of any item to the extent reimbursement for the costs thereof is covered and paid by any applicable guaranty or warranty; (x) any reserves for bad debt or uncollected rent; (y) Landlord’s charitable contributions; or (z) wages, salaries, and compensation paid to officers, executives, and employees of Landlord above the level of Building or Project manager. If the Project is not at least ninety-five percent (95%) leased during any portion of any Fiscal Year, Landlord may adjust (an “Equitable Adjustment”) Operating Costs to equal what would have been incurred by Landlord had the TermProject been 95% leased. By way of example only, assume: (i) the Building has ten floors; (ii) the Tenant occupies one floor and Tenant’s Proportionate Share is ten percent (10%); (iii) the other nine floors are vacant; and (iv) the cost of providing a particular service for Tenant’s floor is $1,000. If Tenant paid Tenant’s Proportionate Share of that cost, Tenant would pay $100. Instead, Landlord shall furnish estimate the cost of such service for the Building as if it were ninety-five percent (95%) leased. Landlord would take into account any economies of scale; for example, the cost for the entire Building at ninety-five percent (95%) occupancy might be $9,000. Landlord’s estimate ($9,000) minus the actual cost incurred by Landlord ($1,000) equals the Equitable Adjustment ($8,000). The Equitable Adjustment is added to the actual cost and Tenant an estimate pays Tenant’s Proportionate Share of the total; in this example, Tenant would pay $9,000 times 10% or $900. This Equitable Adjustment shall apply only to Operating Costs for which are variable and therefore increase as leasing of the ensuing calendar year and Tenant's Proportionate Share thereofProject increases. Tenant shall pay, as additional rent hereunder together with each installment of Base Rent, one-twelfth (1/12th) of Landlord may incorporate the Equitable Adjustment in its estimated annual Proportionate Share estimates of Operating Costs. As soon as reasonably practicable after If Landlord does not furnish any particular service whose cost would have constituted an Operating Cost (which varies with the end level of each calendar year during the Term and in any event within 120 daysoccupancy) to a tenant who has undertaken to perform such service itself, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share of Operating Costs, and within thirty (30) days thereafter Tenant shall pay to Landlord, or Landlord shall credit to the next rent payments due Landlord from Tenant, as the case may be, any difference between the actual Operating Costs and the estimated Operating Costs paid by Tenant. Tenant's Proportionate Share of Operating Costs for the years in which this Lease commences and terminates shall be prorated by multiplying the actual Operating Costs by a fraction the numerator of which is the number of days of that year of the Term and the denominator of which is 365. Notwithstanding any other provision herein to the contrary, it is agreed that in the event that the Project is not fully occupied at any time during the Term, an adjustment shall be made in computing the management fee component of the Operating Costs for such year so that the management fee component of the Operating Costs shall be computed for increased by the amount which Landlord would have incurred if it had furnished the service to such year as though the Project had been fully occupied during such year. For a period of three (3) years following Tenant's receipt of Landlord's statement of actual Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours tenant in the offices where Landlord maintains its accounting records. No subtenant will have same manner as the right to audit Equitable Adjustment under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result of the auditpreceding paragraph.
Appears in 1 contract
Operating Costs. Tenant shall, for the entire Term, pay to Landlord as an item of additional rent, without any setoff or deduction therefrom, its Proportionate Share of except as expressly provided in this Lease, all costs ("Operating Costs") which Landlord may incur in maintaining and operating the Project Premises during each calendar year of the Term. "Proportionate Share" is defined as the decimal equivalent of a fraction, the numerator of which is the rentable area of the Premises and the denominator of which is the rentable area within the entire Building. "Operating CostsOPERATING COSTS" are defined to include all reasonable expenses and costs (but not specific costs which are separately billed to and paid by individual tenants, including Tenant) which the Landlord shall pay or become obligated to pay because of or in connection with the operation and maintenance of the Project and supporting facilities of the ProjectPremises, including but not limited to all real estate taxes and annual installments of special assessments due and payable in such calendar year with respect to the ProjectPremises; costs of any contest of such taxes, including reasonable attorney's fees; management fees (except that no management fee shall be charged during such period(s) that Tenant elects to maintain and manage the common areas pursuant to Section 10)fees, insurance premiums, utility costs, security costs, costs of wages, maintenance costs (relating to the Project Premises including sidewalks, landscaping and parking or service areas, common areas, service contracts, equipment and supplies) and all other costs of any nature whatsoever which for federal tax purposes may be expensed rather than capitalized, all in accordance with Generally Accepted Accounting PrinciplesPrinciples ("GAAP"), consistently applied but exclusive only of legal fees, leasing commissions, depreciation, costs of leasehold improvements and all costs of a capital nature except as provided in the next sentence and payments of principal and interest on any mortgages, deeds of trusts, or other security devices covering the ProjectPremises. Operating Costs shall also include the yearly amortization of capital costs (amortized over the useful life of the improvement as reasonably determined by Landlord in accordance with GAAP) incurred by the Landlord for improvements or structural repairs to the Project Premises required to comply with any change (after the commencement date Commencement Date) in the laws, rules or regulations of any governmental authority having jurisdiction, or or, for purposes of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building components)Costs, which costs shall be amortized over the useful life of such improvements or repairs, as reasonably estimated by the LandlordLandlord in accordance with GAAP, but in no event shall the annual amortization be in excess of the savings. The management fee shall not exceed 3% of Tenant's Base Rent and Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site manager, any administrative or overhead expenses, any special assessments or charges Notwithstanding anything contained in the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with or as a consequence of the development of the Project. As soon as reasonably practicable prior to the commencement of each calendar year during the Term, Landlord shall furnish to Tenant an estimate of Operating Costs for the ensuing calendar year and Tenant's Proportionate Share thereof. Tenant shall pay, as additional rent hereunder together with each installment of Base Rent, one-twelfth (1/12th) of its estimated annual Proportionate Share of Operating Costs. As soon as reasonably practicable after the end of each calendar year during the Term and in any event within 120 days, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share of Operating Costs, and within thirty (30) days thereafter Tenant shall pay to Landlord, or Landlord shall credit to the next rent payments due Landlord from Tenant, as the case may be, any difference between the actual Operating Costs and the estimated Operating Costs paid by Tenant. Tenant's Proportionate Share of Operating Costs for the years in which this Lease commences and terminates shall be prorated by multiplying the actual Operating Costs by a fraction the numerator of which is the number of days of that year of the Term and the denominator of which is 365. Notwithstanding any other provision herein to the contrary, it is agreed that in the event that the Project is not fully occupied at any time during the Term, an adjustment following shall be made in computing the management fee component of the Operating Costs for such year so that the management fee component of the Operating Costs shall be computed for such year as though the Project had been fully occupied during such year. For a period of three (3) years following Tenant's receipt of Landlord's statement of actual Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books apply with respect to real estate taxes and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in the offices where Landlord maintains its accounting records. No subtenant will have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result of the audit.assessments:
Appears in 1 contract
Samples: Lease Agreement (Department 56 Inc)
Operating Costs. Tenant shall(a) Operating Costs" are the costs of managing, operating, maintaining, repairing, redecorating, refurbishing and insuring the Building and all common areas and facilities within the Property (including, but not limited to, elevators, stairwells, loading areas, parking areas, pavements and walkways, landscaping, gardening, storm drainage, and other utility systems); the cost of utilities for such common areas and facilities; fire protection and security services, if any; traffic control equipment; repairs; parking lot striping; lighting; sanitary control; removal of snow, trash, rubbish, garbage and other refuse; depreciation on or rentals of machinery and equipment used in such maintenance; the cost of personnel to implement such services; all insurance of whatsoever nature kept, or caused to be kept, by Landlord out of or in connection with the ownership of the Building and common areas, including, but not limited to, insurance insuring the same against loss or damage by, or abatement of rental income resulting from, fire and other such hazards, casualties, and contingencies, and liability and indemnity insurance; plus Landlord's actual administrative and overhead costs in connection therewith. Such costs shall not include the cost of any capital improvements to the Building as determined under generally accepted accounting principles or work which Landlord performs specifically for or at the expense of any tenant of the Building. Operating Costs shall also include Landlord’s management fee which shall not exceed four percent (4%) of the gross rental receipts for the entire Term, pay to Landlord as an item of additional rent, without any setoff or deduction therefrom, its Proportionate Share of costs ("Operating Costs") which Landlord may incur in maintaining and operating the Project during each calendar year of the Term. "Proportionate Share" is defined as the decimal equivalent of a fraction, the numerator of which is the rentable area of the Premises and the denominator of which is the rentable area within the entire Building. "Operating Costs" are defined to shall also include all reasonable expenses taxes (as hereinafter defined) assessed against the Property and costs (but Building, whether as a result of an increase in the tax rate, or the levy, assessment or imposition of any tax on real estate as such not specific costs which are separately billed now levied, assessed or imposed. The foregoing shall apply to and paid by individual tenants, including Tenant) which the Landlord shall pay or become obligated to pay because of or increases in connection with the operation and maintenance of the Project and supporting facilities of the Project, including but not limited to all real estate taxes assessed against the land or Building generally, and annual installments of special assessments payable in such calendar year with respect to not resulting from improvements placed thereon by Tenant. In the Project; costs event of any contest increases in real estate taxes resulting from improvements, alterations or additions made by Tenant, Tenant shall pay the entire amount of such said increase. "Taxes" as used herein shall include, but not by way of limitation, all paving taxes, including reasonable attorney's fees; management fees (except that no management fee shall be charged during such period(s) that Tenant elects to maintain special paving taxes, Metropolitan District Charges, and manage the common areas pursuant to Section 10), insurance premiums, utility costs, security costs, costs of wages, maintenance costs (relating to the Project including sidewalks, landscaping and parking or service areas, common areas, service contracts, equipment and supplies) any and all other costs of any nature whatsoever benefits or assessments which for federal tax purposes may be expensed rather than capitalized, all in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, costs of leasehold improvements and payments of principal and interest levied on any mortgages, deeds of trusts, the Property or other security devices covering the Project. Operating Costs shall also include the yearly amortization of capital costs incurred by the Landlord for improvements or structural repairs to the Project required to comply with any change after the commencement date in the laws, rules or regulations of any governmental authority having jurisdiction, or for purposes of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building components), which costs shall be amortized over the useful life of such improvements or repairs, as reasonably estimated by the LandlordBuilding, but in no event in excess of the savings. The management fee shall not exceed 3% of Tenant's Base Rent and Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses shall not include any compensation income tax on the income or benefits for any off-site manager, any administrative or overhead expenses, any special assessments or charges in the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with or as a consequence of the development of the Project. As soon as reasonably practicable prior to the commencement of each calendar year during the Term, Landlord shall furnish to Tenant an estimate of Operating Costs for the ensuing calendar year and Tenant's Proportionate Share thereof. Tenant shall pay, as additional rent hereunder together with each installment of Base Rent, one-twelfth (1/12th) of its estimated annual Proportionate Share of Operating Costs. As soon as reasonably practicable after the end of each calendar year during the Term and in any event within 120 days, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share of Operating Costs, and within thirty (30) days thereafter Tenant shall pay to Landlord, or Landlord shall credit to the next rent payments due Landlord from Tenant, as the case may be, any difference between the actual Operating Costs and the estimated Operating Costs paid by Tenant. Tenant's Proportionate Share of Operating Costs for the years in which this Lease commences and terminates shall be prorated by multiplying the actual Operating Costs by a fraction the numerator of which is the number of days of that year of the Term and the denominator of which is 365. Notwithstanding any other provision herein to the contrary, it is agreed that in the event that the Project is not fully occupied at any time during the Term, an adjustment shall be made in computing the management fee component of the Operating Costs for such year so that the management fee component of the Operating Costs shall be computed for such year as though the Project had been fully occupied during such year. For a period of three (3) years following Tenant's receipt of Landlord's statement of actual Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in the offices where Landlord maintains its accounting records. No subtenant will have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result of the auditpayable hereunder.
Appears in 1 contract
Samples: Lease Agreement (Steelcloud Inc)
Operating Costs. Operating Costs means any and all costs and expenses directly related to ownership and operation of the Premises actually incurred by Landlord from and after the Commencement Date of this Lease in connection with:
(a) the repair, replacement, operation, and maintenance of the Premises, including, without limitation, interior and exterior maintenance, all exterior doors and windows, elevators, sidewalks, driveways, interior perimeter and interior partition walls and finishes (including periodic painting thereof), exterior wall finishes, broken glass in exterior and interior doors and windows, roof, floor covering, window frames, gutters and downspouts, HVAC system,
(b) the issuer administrative fee paid Landlord under the operating budget and the property management fees paid to the entity or entities managing the Premises under property management contracts which meet the requirements of Section 10.2 of this Lease;
(c) the auditing fees incurred by Landlord in connection with the preparation of the financial statements required under Section 10.2 of this Lease;
(d) the expenses, fees and charges paid to the operator of the , if any, and incurred in connection with operation of the , provided that Tenant shall, has concurred with the hiring of an operator for the entire Termmanagement contract which complies with Revenue Procedure 97-13 or any successor revenue procedure issued by the Internal Revenue Service governing management, pay operation or other service contracts in connection with the issuance of tax-exempt obligations;
(e) all costs of services furnished by or through Landlord, if any, in connection with the Premises (provided, however, Landlord shall be required to Landlord as an item of additional rentobtain such services at rates generally competitive in the marketplace), without any setoff or deduction therefromincluding janitorial, its Proportionate Share of security, if any, in connection with the Premises, gardening, landscaping, and related costs ("Operating Costs") which Landlord may incur in maintaining and operating the Project during each calendar year of the Term. "Proportionate Share" is defined as the decimal equivalent of a fractionexpenses, licenses, permits, and inspection fees, the numerator cost of which is supplies, materials, equipment, and tools used in connection with the rentable area maintenance, operation, repair or replacement of the Premises and all other reasonable, necessary and customary costs and expenses directly related to the denominator operation, maintenance, repair and replacement of which is the rentable area within Premises;
(f) any damage to the entire Building. "Operating Costs" are defined to include all reasonable expenses and costs Premises (but not specific to Tenant’s Personal Property) caused by breaking and entering or other criminal act not covered by insurance;
(g) all costs which are separately billed to and paid by individual tenants, including Tenantof compliance with Laws or the board of fire underwriters (or similar organization) which the Landlord shall pay now or become obligated to pay because of or in connection with the operation and maintenance of the Project and supporting facilities of the Project, including but not limited to all real estate taxes and annual installments of special assessments payable in such calendar year with respect hereafter constituted as applicable to the Project; costs of any contest of such taxes, including reasonable attorney's fees; management fees Premises;
(except that no management fee shall be charged during such period(sh) that Tenant elects to maintain and manage the common areas pursuant to Section 10), all insurance premiums, utility costs, security costs, costs of wages, maintenance costs (relating to the Project including sidewalks, landscaping and parking or service areas, common areas, service contracts, equipment and supplies) and all other costs of any nature whatsoever which premiums for federal tax purposes may be expensed rather than capitalized, all in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, costs of leasehold improvements and payments of principal and interest on any mortgages, deeds of trusts, or other security devices covering the Project. Operating Costs shall also include the yearly amortization of capital costs incurred by the Landlord for improvements or structural repairs to the Project insurance required to comply with any change after be carried under
(i) all rent and other payments owing by Landlord under the commencement date terms of
(j) all costs or liabilities that Landlord may incur under the
(k) amounts for deposit in the laws, rules or regulations of any governmental authority having jurisdiction, or for purposes of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building components), which costs shall be amortized over the useful life of such improvements or repairs, as reasonably estimated by the Landlord, but in no event in excess of the savings. The management fee shall not exceed 3% of Tenant's Base Rent and Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site manager, any administrative or overhead expenses, any special assessments or charges in the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with or as a consequence of the development of the Project. As soon as reasonably practicable prior to the commencement of each calendar year during the Term, Landlord shall furnish to Tenant an estimate of Operating Costs for the ensuing calendar year and Tenant's Proportionate Share thereof. Tenant shall pay, as additional rent hereunder together with each installment of Base Rent, one-twelfth (1/12th) of its estimated annual Proportionate Share of Operating Costs. As soon as reasonably practicable after the end of each calendar year during the Term and in any event within 120 days, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share of Operating Costs, and within thirty (30) days thereafter Tenant shall pay to Landlord, or Landlord shall credit to the next rent payments due Landlord from Tenant, as the case may be, any difference between the actual Operating Costs and the estimated Operating Costs paid by Tenant. Tenant's Proportionate Share of Operating Costs for the years in which this Lease commences and terminates shall be prorated by multiplying the actual Operating Costs by a fraction the numerator of which is the number of days of that year of the Term and the denominator of which is 365. Notwithstanding any other provision herein to the contrary, it is agreed that in the event that the Project is not fully occupied at any time during the Term, an adjustment shall be made in computing the management fee component of the Operating Costs for such year so that the management fee component of the Operating Costs shall be computed for such year as though the Project had been fully occupied during such year. For a period of three (3) years following Tenant's receipt of Landlord's statement of actual Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in the offices where Landlord maintains its accounting records. No subtenant will have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term Capital Repairs Fund pursuant to the Lease. In the event a discrepancy of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result of the audit.to
Appears in 1 contract
Samples: Lease Agreement
Operating Costs. In addition to Base Rent and Additional Rent, Tenant shall, for the entire Term, pay to Landlord as an item of additional rentLandlord, without any setoff or deduction therefrom, its Proportionate Share (as hereinafter defined) of costs ("Operating Costs") which Landlord may incur in owning, maintaining and operating the Project Building during each calendar year of the TermTerm (such costs hereinafter "Operating Costs"), which Operating Costs shall be paid with each installment of Base Rent due and payable hereunder. "Proportionate Share" is defined as all Operating Costs incurred by Landlord with respect to the Building (Proportionate Share being expressed as the decimal equivalent of a fraction, the numerator of which is the net rentable area square feet of the Premises and the denominator of which is the net rentable area within square feet of the entire Building, each as reasonably determined by Landlord). "Operating Costs" are defined to Costs include all reasonable expenses and costs (but not specific costs which are separately billed to and paid by individual tenants, tenants including Tenant) of every kind and nature which the Landlord shall pay or become obligated to pay because of or in connection with the ownership and operation and maintenance of the Project and Building, supporting facilities of the ProjectBuilding and the Land, including but not limited to all real estate taxes and annual installments of special or other assessments payable in such calendar year with respect to the ProjectBuilding and the Land, and all other taxes, service payments in lieu of taxes, excises, levies, fees, or charges, general and special, ordinary and extraordinary, of any kind, which are assessed, levied, charged, confirmed or imposed by any public authority upon the Building or the Land, the operations of the Building or the Land or the Rent (as defined below) provided for in this Lease including, but not limited to, the amount of any gross receipts tax, sales tax or similar tax, or any tax imposed in lieu of real property taxes (but excluding therefrom any income tax), or tax arising out of ownership of the Building or the Land, which tax is payable or which will be payable by Landlord, by reason of the receipt of the Base Rent, Operating Costs or Additional Rent and adjustments thereto; costs of any contest of such taxestaxes (including attorneys' fees), including reasonable attorney's accounting fees; , management fees (except that no management fee shall be charged during such period(s) that Tenant elects to maintain and manage the common areas pursuant to Section 10)fees, insurance premiums, utility costs, janitorial costs, Building security costs, costs of wages, salaries and fringe benefits for all individuals providing services to the Building through the level of property manager or similar position, maintenance costs (relating to the Project Building, the Land and adjacent land including sidewalks, landscaping and parking or service areas, common areas, service contracts, equipment and supplies) ), any costs incurred by Landlord in providing valet parking and all other costs of any nature whatsoever so long as directly related to the operation of the Building which for federal tax purposes may be expensed rather than capitalized, all in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, principal and interest, and costs of leasehold improvements and payments of principal and interest on any mortgages, deeds of trusts, or other security devices covering the Projecttenant improvements. Operating Costs shall also include the yearly amortization of capital costs incurred by the Landlord for improvements or structural repairs to the Project Building required to comply with any change after the commencement date in the laws, rules or regulations of any governmental authority having jurisdiction, jurisdiction or for purposes of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building components)Costs, which costs shall be amortized over the useful life of such improvements or repairs, as reasonably estimated by the Landlord, but in no event in excess of the savings. The management fee shall not exceed 3% of Tenant's Base Rent and Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site manager, any administrative or overhead expenses, any special assessments or charges in the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with Landlord or as a consequence of the development of the Projectrequired by law. As soon as reasonably practicable prior to the commencement of each calendar year during the Term, Landlord shall furnish to Tenant an estimate of Operating Costs for the ensuing calendar year and the amount of Tenant's Proportionate Share thereof. Commencing on January 1 of said ensuing calendar year, Tenant shall pay, as additional rent hereunder together with each installment of Base Rent, one-twelfth (1/12th) of its estimated annual Proportionate Share of Operating Costs. As soon as reasonably practicable after the end of each calendar year during the Term and in any event within 120 daysTerm, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share of Operating Costs, and within thirty (30) days thereafter Tenant shall pay to Landlord, Landlord or Landlord shall credit to against the next rent payments Base Rent payment due Landlord from TenantTenant or Landlord shall pay, if the Lease has expired, as the case may be, any difference between the actual Operating Costs and the estimated Operating Costs paid by TenantTenant for such year. Tenant's Proportionate Share of Operating Costs for each of the years in which this Lease commences and terminates shall be prorated by multiplying the actual Operating Costs by a fraction fraction, the numerator of which is the number of days of that each such year of the Term and the denominator of which is 365, provided that the denominator shall be 366 for the 2000 calendar year and every fourth year thereafter. Tenant's obligation to pay Operating Costs for the year in which this Lease expires or otherwise terminates shall survive the expiration or earlier termination of this Lease, and shall be prorated to reflect that portion of the calendar year during which Tenant was obligated to pay Operating Costs. Notwithstanding any other provision herein to the contrary, it is agreed that in the event that the Project Building is not fully occupied at any time during the Term, an adjustment shall be made in computing the management fee component of the Operating Costs for such year so that the management fee component of the Operating Costs shall be computed for such year as though the Project Building had been fully occupied during such year (including, for real estate tax purposes, as if fully occupied and assessed as a completed Building during such year). For a period Notwithstanding the foregoing, if Landlord shall from time to time reasonably determine that the use of three (3) years following any utility or service in the Premises by Tenant is disproportionate to the use of other tenants, Landlord may adjust Tenant's receipt share of the cost thereof from a date reasonably determined by Landlord to take equitable account of the disproportionate use. At Landlord's statement of actual Operating Costsoption, Landlord shall keep available for may install and maintain at Tenant's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours expense metering devices for measuring the use of any such utility or service in the offices where Landlord maintains its accounting records. No subtenant will have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result of the auditPremises.
Appears in 1 contract
Samples: Lease Agreement (Zamba Corp)
Operating Costs. In addition to Base Rent and Additional Rent, Tenant shall, for the entire Term, pay to Landlord as an item of additional rentLandlord, without any setoff or deduction therefrom, its Proportionate Share (as hereinafter defined) of costs ("Operating Costs") which Landlord may incur in owning, maintaining and operating the Project Building during each calendar year of the TermTerm (such costs hereinafter "Operating Costs"). "Proportionate Share" is defined as (3.74%) of all Operating Costs incurred by Landlord with respect to the Building (being the decimal equivalent of a fraction, the numerator of which is the net rentable area square feet of the Premises and the denominator of which is the net rentable area within square feet of the entire BuildingBuilding each as reasonably determined by Landlord). "Operating Costs" Costs are defined to include all reasonable expenses and costs (but not specific costs which are separately billed to and paid by individual tenants, tenants including Tenant) of every kind and nature which the Landlord shall pay or become obligated to pay because of or in connection with the ownership and operation and maintenance of the Project Building and supporting facilities of the ProjectBuilding, including but not limited to all real estate taxes and annual installments of special or other assessments payable in such calendar year with respect to the ProjectBuilding, and all other taxes, service payments in lieu of taxes, excises, levies, fees, or charges, general and special, ordinary and extraordinary, of any kind, which are assessed, levied, charged, confirmed or imposed by any public authority upon the Building, its operations or the Rent provided for in this Lease including, but not limited to the amount of any gross receipts tax, sales tax or similar tax, or any tax imposed in lieu of real property taxes (but excluding therefrom any income tax), or tax arising out of ownership of the Building, which tax is payable or which will be payable by Landlord, by reason of the receipt of the Base Rent, Operating Costs or Additional Rent and adjustments thereto; costs of any contest of such taxes, including reasonable attorney's attorneys' fees; , management fees (except that no management fee shall be charged during such period(s) that Tenant elects to maintain and manage the common areas pursuant to Section 10)fees, insurance premiums, utility costs, janitorial costs, Building security costs, costs of wages, salaries and fringe benefits for all individuals providing services to the Building through the level of property manager or similar position, maintenance costs (relating to the Project Building and adjacent land including sidewalks, landscaping and parking or service areas, common areas, service contracts, equipment and supplies) and all other costs of any nature whatsoever which for federal tax purposes may be expensed rather than capitalized, all in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, principal and interest, and costs of leasehold improvements and payments of principal and interest on any mortgages, deeds of trusts, or other security devices covering the Projecttenant improvements. Operating Costs shall also include the yearly amortization of capital costs incurred by the Landlord for improvements or structural repairs to the Project Building required to comply with any change after the commencement date in the laws, rules or regulations of any governmental authority having jurisdiction, or for purposes of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building components)Costs, which costs shall be amortized over the useful life of such improvements or repairs, as reasonably estimated by the Landlord, but in no event in excess of the savings. The management fee shall not exceed 3% of Tenant's Base Rent and Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site manager, any administrative or overhead expenses, any special assessments or charges in the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with Landlord or as a consequence of the development of the Projectrequired by law. As soon as reasonably practicable prior to the commencement of each calendar year during the Term, Landlord shall furnish to Tenant an estimate of Operating Costs for the ensuing calendar year and the amount of Tenant's Proportionate Share thereof. Tenant shall pay, as additional rent hereunder together with each installment of Base Rent, one-twelfth (1/12th) of its estimated annual Proportionate Share of Operating Costs. As soon as reasonably practicable after the end of at each calendar year during the Term and in any event within 120 daysTerm, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share of Operating Costs, and within thirty (30) days thereafter Tenant shall pay to Landlord, Landlord or Landlord shall credit to the next rent payments Base Rent payment due Landlord from TenantTenant or Landlord shall pay, if the Lease has expired, as the case may be, any difference between the actual Operating Costs and the estimated Operating Costs paid by TenantTenant for such year. Tenant's Proportionate Share of Operating Costs for the years in which this Lease commences and terminates shall be prorated by multiplying the actual Operating Costs by a fraction fraction, the numerator of which is the number of days of that year of the Term and the denominator of which is 365. Tenant's obligation to pay Operating Costs for the year in which this Lease expires or terminates shall survive the expiration or earlier termination of this Lease, and shall be prorated to reflect that portion of the calendar year during which Tenant was obligated to pay Operating Costs. Notwithstanding any other provision herein to the contrary, it is agreed that in the event that the Project Building is not fully occupied at any time during the Term, an adjustment shall be made in computing the management fee component of the Operating Costs for such year so that the management fee component of the Operating Costs shall be computed for such year as though the Project Building had been fully occupied during such year (including, for real estate tax purposes, as if fully occupied and assessed as a completed Building during such year). For a period Notwithstanding the foregoing, if Landlord shall from time to time reasonably determine that the use of three (3) years following any utility or service in the Premises by Tenant is disproportionate to the use of other tenants, Landlord may adjust Tenant's receipt share of the cost thereof from a date reasonably determined by Landlord to take equitable account of the disproportionate use. A Landlord's statement of actual Operating Costsrequest, Landlord Tenant shall keep available for install and maintain at Tenant's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours expense metering devices for measuring the use of any such utility or service in the offices where Landlord maintains its accounting records. No subtenant will have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result of the auditPremises.
Appears in 1 contract
Samples: Lease Agreement (Webvalley Inc)
Operating Costs. Tenant shall, shall pay as Additional Rent its pro rata share of Operating Costs of the Building and Property. The projected preliminary estimated calendar year 1999 operating costs for the entire Term, pay to Landlord as an item of additional rent, without any setoff or deduction therefrom, its Proportionate Share of costs ("Operating Costs") which Landlord may incur in maintaining and operating the Project during each calendar year Premises are $1.90 per rentable square foot of the TermPremises. "Proportionate Share" is defined as This amount shall be adjusted in accordance with the decimal equivalent of a fractionprocedures outlined below.
(a) Definition. As used herein, the numerator of which is the rentable area of the Premises and the denominator of which is the rentable area within the entire Building. term "Operating Costs" are defined to include all reasonable expenses means (except as specifically excluded below) the actual costs incurred in owning, operating and costs (but not specific costs which are separately billed to maintaining the Building and paid by individual tenants, including Tenant) which Property during each year of the Landlord shall pay or become obligated to pay because of or in connection with the Lease Term. Such operation and maintenance costs shall include, by way of the Project example rather than of limitation, (i) real property, county, and supporting facilities of the Projectother similar taxes or assessments, including but not limited to any special assessments, levied against any or all real estate of the Building and Property; (ii) charges or fees for, and taxes on, the furnishing of water, sewer service, gas, fuel, electricity or other utility services to the Premises and annual installments common areas of special assessments payable the Building and Property; (iii) costs of providing landscaping service, snow removal service, and of maintaining grounds, common areas of the Building and adjacent parking areas and mechanical systems of the Building; (iv) all other reasonable costs of maintaining, repairing or replacing any or all of the Building, except (a) costs for repairs, maintenance and replacements required due to defective materials, installations or workmanship at the time of initial construction of the Building and Property and expenses incurred in connection with the enforcement of any warranty rights in connection therewith, or (b) costs to repair the roof, foundation, interior load bearing partitions, exterior walls and window systems, except to the extent any such calendar structural repair is required due to Tenant's negligence or willful misconduct; (v) charges or fees for any necessary governmental permits; (vi) customary and reasonable management fees under a management agreement, and related overhead and expenses; (vii) premiums for hazard, liability, workmen's compensation or similar insurance upon any or all of the Building and Property as maintained by Landlord under Paragraph 20; (viii) costs arising under service contracts with independent contractors for servicing, maintenance and repair of building equipment and systems; and (ix) the cost of any other items which, under generally accepted accounting principles consistently applied from year to year with respect to the Project; costs of any contest of such taxesBuilding and Property, including reasonable attorney's fees; management fees (except that no management fee shall be charged during such period(s) that Tenant elects to maintain and manage the common areas pursuant to Section 10), insurance premiums, utility costs, security costs, costs of wages, constitute operating or maintenance costs (relating attributable to the Project including sidewalks, landscaping and parking any or service areas, common areas, service contracts, equipment and supplies) and all other costs of any nature whatsoever which for federal tax purposes may be expensed rather than capitalized, all in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, costs of leasehold improvements and payments of principal and interest on any mortgages, deeds of trusts, or other security devices covering the Project. Operating Costs shall also include the yearly amortization of capital costs incurred by the Landlord for improvements or structural repairs to the Project required to comply with any change after the commencement date in the laws, rules or regulations of any governmental authority having jurisdiction, or for purposes of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building components), which costs shall be amortized over the useful life of such improvements or repairs, as reasonably estimated by the Landlord, but in no event in excess of the savingsPremises. The management fee shall not exceed 3% Landlord and its agents reserve the right to enter onto the Premises at reasonable times upon reasonable notice from Landlord or its agent and accompanied by a representative of Tenant's Base Rent and Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site manager, any administrative or overhead expensesexcepting emergency, any special assessments or charges in the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with or as a consequence of the development of the Project. As soon as reasonably practicable prior to the commencement of each calendar year during the Term, Landlord shall furnish to Tenant an estimate of Operating Costs for the ensuing calendar year specific purpose of managing and Tenant's Proportionate Share thereofmaintaining the Premises. Tenant Landlord agrees that it shall pay, as additional rent hereunder together with each installment of Base Rent, one-twelfth (1/12th) of make no profit from its estimated annual Proportionate Share collection of Operating Costs. As soon as reasonably practicable after the end of each calendar year during the Term and in any event within 120 days, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share of Operating Costs, and within thirty (30) days thereafter Tenant shall pay to Landlord, or Landlord shall credit to the next rent payments due Landlord from Tenant, as the case may be, any difference between the actual Operating Costs and the estimated Operating Costs paid by Tenant. Tenant's Proportionate Share of Operating Costs for the years in which this Lease commences and terminates shall be prorated by multiplying the actual Operating Costs by a fraction the numerator of which is the number of days of that year of the Term and the denominator of which is 365. Notwithstanding any other provision herein to the contrary, it is agreed that in the event that the Project is not fully occupied at any time during the Term, an adjustment shall be made in computing the management fee component of the Operating Costs for such year so that the management fee component of the Operating Costs shall be computed for such year as though the Project had been fully occupied during such year. For a period of three (3) years following Tenant's receipt of Landlord's statement of actual Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in the offices where Landlord maintains its accounting records. No subtenant will have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result of the audit.
Appears in 1 contract
Operating Costs. (a) Tenant shallhereby covenants and agrees and shall be obligated to pay to Landlord, in addition to and not in lieu of the other amounts specified herein, Tenant’s Share of Operating Costs in excess of the Initial Operating Costs. These payments shall be in addition to and not in lieu of any other payments due from Tenant hereunder. The “Initial Operating Costs” shall be, for the entire Termpurposes of this Lease, pay the actual Operating Costs for calendar year 2006, adjusted pursuant to Landlord as an item the terms of additional rent, without any setoff or deduction therefrom, its Proportionate Share of costs this Lease.
("b) The term “Operating Costs") ”, as adjusted pursuant to the terms of this Lease, shall mean any and all operating expenses of the Property, Building and related areas (such as, by way of illustration but not limitation, the parking areas), computed on an accrual basis and including all expenses, costs, and disbursements of every kind and nature, which Landlord may incur in maintaining and operating the Project during each calendar year of the Term. "Proportionate Share" is defined as the decimal equivalent of a fraction, the numerator of which is the rentable area of the Premises and the denominator of which is the rentable area within the entire Building. "Operating Costs" are defined to include all reasonable expenses and costs (but not specific costs which are separately billed to and paid by individual tenants, including Tenanti) which the Landlord shall pay or pay; and/or (ii) become obligated to pay because pay, including, but not limited to, the following:
(i) Costs, wages and salaries of all persons engaged in the management, operation, repair, security or maintenance of the Property and Building, including, but not limited to, fringe benefits, taxes, insurance and any other benefits relating thereto;
(ii) All supplies and materials used in connection with the operation and maintenance of the Project Property and supporting facilities Building;
(iii) Cost of water, sewage, electricity and other utilities furnished in connection with the operation of the ProjectBuilding;
(iv) Cost of all service agreements and maintenance for the Property and Building and the equipment therein, including, but not limited to, trash removal, security services, alarm services, window cleaning, janitorial service, HVAC maintenance, elevator maintenance, and grounds maintenance, and cost of all services described in subparagraph 8(a) below;
(v) Cost of all insurance relating to the Property and Building including, but not limited to, the cost of casualty and liability insurance applicable to the Property and Building and Landlord’s personal property used in connection therewith;
(vi) All Taxes (as hereinafter defined) and any reasonable consultants fees incurred with respect to issues or concerns involving the taxes or the Building, the Property, or both;
(vii) Cost of repairs and general maintenance of the interior and exterior of the Property and Building (including, but not limited to, light bulbs and glass breakage; the redecorating, repainting, recarpeting and other such work of any common areas; heating, ventilation and air conditioning equipment; plumbing and electrical equipment; and elevators), parking areas, and landscaping;
(viii) A management fee and other expenses incurred for the general operation and management of the Property and Building, not to exceed 3% of gross revenues from the Building;
(ix) An amortization cost due to any capital expenditures incurred (i) which have the effect of reducing or limiting Operating Costs of the Property and Building, if such reduction or limitation inures to Tenant’s benefit (but only to the extent and in the amount that such Operating Costs of the Property and Building are reduced); (ii) which may be required by governmental authority or by Landlord’s insurance carrier; or (iii) which are designed to protect or enhance the health, safety or welfare of the tenants in the Building or their invitees;
(x) All assessments made, charged, levied, assessed or accrued against Landlord by The Concourse Office Park Association, Inc.;
(xi) Reasonable legal and accounting fees and expenses incurred by Landlord in connection with the management, maintenance and repair of the Property; and
(xii) Anything which could be classified as an Operating Cost under generally accepted accounting principles, consistently applied, but not specified or expressly set forth hereunder; provided such cost is reasonably consistent with operating costs of similar class A office buildings in the central perimeter submarket of Atlanta, Georgia. Excluded from “Operating Costs” are:
(i) net recoveries which reduce expenses incurred by the Landlord including, but not limited to, those pursuant to legal or contractual warranties;
(ii) costs or expenses incurred in connection with satisfying obligations of Landlord which are expressly provided in this Lease to be done at Landlord’s sole cost and expense;
(iii) any expenses which are recovered by the Landlord under a contract, agreement, insurance policy or lease to which the Tenant is not a party, including such amounts which the Landlord would have been able to recover pursuant to insurance policies had the Landlord taken out and maintained the insurance coverage which is required pursuant to this Lease;
(iv) costs of any replacement of to the structure of the Building or its integral systems including but not limited to footings, foundations, structural columns and beams, structural sub-floors bearing walls, exterior walls, roofs, HVAC systems and components, which would be required to be capitalized under generally accepted accounting principles (“GAAP”);
(v) costs and expenses considered to be capital expenses in accordance with GAAP, except as described in Section 3(b)(ix) above;
(vi) any depreciation or notional interest charges thereon, except as expressly set out herein;
(vii) costs and expenses incurred when Tenant was not a Tenant of the Building, such as the original construction costs of the Building, development or complex;
(viii) costs and expenses incurred with respect to any risk which, according to the terms and conditions of this Lease, is not Tenant’s responsibility;
(ix) financing, mortgage and interest charges on the capital retirement of debt of the Landlord and all real estate payments of principal on such debt;
(x) amounts expended by the Landlord related to the leasing of the Building, or any part thereof, including (1) marketing, advertising and promotional expenditures whether specifically for leasing or to promote the Building’s image or otherwise, (2) leasing commissions, (3) tenant inducements of any kind, and (4) the cost of any work related to portions of the Building occupied by other tenants of the building and vacant areas of the Building other than those designated as shared common areas;
(xi) costs and expenses in connection with services or other benefits provided to another tenant or occupant of the Building;
(xii) payments made under any ground or head lease or any legal or other costs incurred as a result of activities or disputes between the Landlord and its mortgagees, partners, shareholders or ground lessors;
(xiii) bad debts, lost rents and any costs associated with the collection or attempted collection of such debts;
(xiv) any unfunded pension or other benefits of any person described in Section 3(b)(i);
(xv) any expenses (including, but not limited to fines, penalties, legal fees and interest) resulting from the Landlord’s failure to comply with this Lease, other tenants’ leases, any contracts laws, or resulting from the negligent acts or willful misconduct of the Landlord or its employees, agents or contractors;
(xvi) any wages, salaries or other compensation paid to any employee not employed at least in part for or on behalf of the Building (provided that costs for employees working for or on behalf of the Building part-time must be allocated by Landlord on a pro rata basis to the Building);
(xvii) any property management fees other than those fees which are consistent with similar buildings in the area and which are consistent with the level of service provided by the Landlord.
(xviii) any duplication of costs created by the Landlord charging a property management fees in addition to the salaries of its employees who are rendering the actual services that would otherwise be covered by the fee;
(xix) other than the Property’s concierge services, any compensation paid to clerks, attendants or other persons in commercial concessions operated by Landlord or any affiliate of Landlord in excess of arms length compensation;
(xx) legal, accounting and similar or related costs paid or incurred in connection with any sale, syndication, financing or refinancing involving the Building or any of Landlord’s interests therein;
(xxi) costs or expenses related to Landlord’s cleaning, removal, remediation or compliance required due to the existence of any hazardous materials in, on or affecting the Building and/or land provided such contamination is not a result of the Tenant’s actions or those for whom the Tenant is at law responsible;
(xxii) costs for charitable or political contributions;
(xxiii) costs of any rent loss or income loss insurance or additional casualty insurance premiums for the Building in excess of the standard rate paid by Landlord, which additional cost is attributable to the tenancy of any other tenant or occupant of the Building;
(xxiv) costs of advertising and promotional for leasing space in the Building;
(xxv) costs allocable to land held for future development that is not in direct support of the Building;
(xxvi) any cost or expense incurred in connection with correcting latent defects in the Premises or the Property;
(xxvii) Landlord’s actual costs incurred in bringing the Property into compliance with applicable laws with which the Property is not in compliance as of the date hereof, including, without limitation, building codes, fire safety regulations and the Americans with Disabilities Act.
(xxviii) corporate, income or profit taxes assessed against the personal income of the Landlord;
(xxix) the Landlord’s capital tax or any large corporation taxes;
(xxx) business taxes levied against the business carried on by the Landlord or any other tenant of the Building; and
(xxxii) local improvement taxes where attributable to the initial development of the Building;
(c) The term “Tenant’s Share” shall mean the proportion that the rentable square footage of the Premises bears to ninety-five percent (95%) of the Total Building Rentable Area, or the average percentage of the Total Building Rentable Area actually leased in the Building for any calendar year, if such average is greater than ninety-five percent (95%) of the Total Building Rentable Area. The average shall be determined by adding together the total leased space on the last day of each month during the calendar year in question and annual installments dividing by twelve (12). Tenant’s Share is used in this Lease to determine the portion of special assessments Operating Costs payable by Tenant, on a per square foot per annum basis. Notwithstanding anything to the contrary contained herein, if the Building is not fully occupied during any calendar year, appropriate adjustments shall be made to determine Operating Costs as though the Building had been fully occupied in such calendar year with respect to the Project; costs of any contest of such taxes, including reasonable attorney's fees; management fees (except that no management fee shall be charged during such period(s) that Tenant elects to maintain and manage the common areas pursuant to Section 10), insurance premiums, utility costs, security costs, costs of wages, maintenance costs (relating to the Project including sidewalks, landscaping and parking or service areas, common areas, service contracts, equipment and supplies) and all other costs of any nature whatsoever which for federal tax purposes may be expensed rather than capitalized, all in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, costs of leasehold improvements and payments of principal and interest on any mortgages, deeds of trusts, or other security devices covering the Project. Operating Costs shall also include the yearly amortization of capital costs incurred by the Landlord for improvements or structural repairs to the Project required to comply with any change after the commencement date in the laws, rules or regulations of any governmental authority having jurisdiction, or for purposes of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building components), which costs shall be amortized over the useful life of such improvements or repairs, as reasonably estimated by the Landlord, but in no event in excess of the savings. The management fee shall not exceed 3% of Tenant's Base Rent and Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site manager, any administrative or overhead expenses, any special assessments or charges in the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with or as a consequence of the development of the Project. As soon as reasonably practicable prior to the commencement of each calendar year during the Term, Landlord shall furnish to Tenant an estimate of Operating Costs for the ensuing calendar year and Tenant's Proportionate Share thereof. Tenant shall pay, as additional rent hereunder together with each installment of Base Rent, one-twelfth (1/12th) of its estimated annual Proportionate Share of Operating Costs. As soon as reasonably practicable after the end of each calendar year during the Term and in any event within 120 days, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous entire calendar year, including Tenant's Proportionate Share of Operating Costs, and within thirty (30) days thereafter Tenant shall pay to Landlord, or Landlord shall credit to the next rent payments due Landlord from Tenant, as the case may be, any difference between the actual Operating Costs and the estimated Operating Costs paid by Tenant. Tenant's Proportionate Share of Operating Costs for the years in which this Lease commences and terminates shall be prorated by multiplying the actual Operating Costs by a fraction the numerator of which is the number of days of that year of the Term and the denominator of which is 365. Notwithstanding any other provision herein to the contrary, it is agreed that in the event that the Project is not fully occupied at any time during the Term, an adjustment shall be made in computing the management fee component of the Operating Costs for such year so that the management fee component of the Operating Costs shall be computed for such year as though the Project had been fully occupied during such year. For a period of three (3) years following Tenant's receipt of Landlord's statement of actual Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in the offices where Landlord maintains its accounting records. No subtenant will have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result of the audit.
Appears in 1 contract
Samples: Lease Agreement (First Horizon Pharmaceutical Corp)
Operating Costs. From and after the Commencement Date, Tenant shall, for the entire Term, shall pay to Landlord Landlord, as an item of additional rent, without any setoff or deduction therefrom, its Tenant’s Proportionate Share of costs Operating Costs ("as hereinafter defined) incurred by Landlord with respect to the Building. As used herein, “Operating Costs") which Landlord may incur in maintaining and operating the Project during each calendar year of the Term. "Proportionate Share" is defined as the decimal equivalent of a fraction, the numerator of which is the rentable area of the Premises and the denominator of which is the rentable area within the entire Building. "Operating Costs" are defined to include ” means all reasonable expenses and costs (but not specific costs which are separately billed to and paid by individual tenantsof, including Tenantappropriate reserves for, operating, managing (estimated to be four percent (4%) which the Landlord shall pay or become obligated to pay because of or in connection with the operation and maintenance of the Project and supporting facilities of the ProjectBase Rent), administering, repairing, replacing, improving, equipping, supplying, insuring (including but not limited to all real estate taxes rent loss insurance), lighting, landscaping, cleaning and annual installments maintaining the Building and the facilities and equipment contained therein and its Common Areas, including, without limitation, removing water, snow and ice, painting, resurfacing and striping of special assessments payable in such calendar year with respect to the Project; costs of any contest of such parking area and driveway area, policing, providing security and fire protection, pest and rodent control, traffic regulation, removing debris, trash and refuse, personal property taxes, including reasonable attorney's fees; management fees (except that no management fee shall be charged during such period(s) that Tenant elects to maintain equipment rental, permits and manage the common areas pursuant to Section 10)licenses, insurance premiumsoperating of audio systems, utility costsproviding utilities, security costscompensation paid to, costs of wages, maintenance costs (relating to the Project including sidewalks, landscaping and parking or service areas, common areas, service contracts, equipment and supplies) and all other costs expenses of, personnel employed in operating the Building and all other areas, facilities, equipment, easement areas, fixtures and buildings used in the maintenance and operation of the Building, together with the cost of repair, painting, maintenance, replacement and rental of signs, directories, doors, roofs, ceilings, skylights, windows, exterior walls, basement foundation walls, if any, to the extent not made a part of premises leased to any nature whatsoever which for federal tax purposes may be expensed rather than capitalizedother tenant of the Building, refurbishing and modernizing equipment servicing the Building, plus an amount equal to fifteen percent (15%) of the total of all in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, costs the foregoing to cover Landlord’s administration and overhead. Tenant’s Proportionate Share of leasehold improvements and payments of principal and interest on any mortgages, deeds of trusts, or other security devices covering the Project. Operating Costs shall also include be paid in advance in estimated monthly installments on the yearly amortization first day of capital costs incurred by the Landlord for improvements or structural repairs each calendar month in an amount equal to the Project required to comply with any change Operating Charge set forth in Section 1.13. Within ninety (90) days after the commencement date in the laws, rules or regulations of any governmental authority having jurisdiction, or for purposes of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building components), which costs shall be amortized over the useful life of such improvements or repairs, as reasonably estimated by the Landlord, but in no event in excess of the savings. The management fee shall not exceed 3% of Tenant's Base Rent and Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site manager, any administrative or overhead expenses, any special assessments or charges in the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with or as a consequence of the development of the Project. As soon as reasonably practicable prior to the commencement end of each calendar year during the Term, Landlord shall furnish to notify Tenant an estimate of the actual amount of Tenant’s Proportionate Share of Operating Costs itemized in reasonable detail. If the total of Tenant’s Payments of the Operating Charge for the same period is more than Tenant’s Proportionate Share of Operating Costs for such period, Landlord shall refund Tenant the ensuing calendar year and overpayment within fifteen (15) days of such reconciliation. If the total of Tenant's Proportionate Share thereof. Tenant shall pay, as additional rent hereunder together with each installment ’s payments of Base Rent, one-twelfth (1/12th) of its estimated annual the Operating Charge for the same period is less than Tenant’s Proportionate Share of Operating CostsCosts for such period, Tenant shall pay Landlord the deficit within fifteen (15) days after receipt of such notice. As soon as reasonably practicable after Landlord shall have the end right, from time to time during the Term, to notify Tenant in writing of each any adjustments in the amount of the Operating Charge to be paid by Tenant hereunder and thereafter Tenant shall make payments accordingly without notice or demand in lieu of the amount set forth in Section 1.13. Tenant’s obligation for additional rent under this Section 3.4 for any partial calendar year during the Term and in any event within 120 days, Landlord shall furnish to Tenant a statement be prorated based upon the number of days of the actual Operating Costs Term during such year. Tenant’s obligation for additional rent under this Section through the previous calendar yearTermination Date shall survive the expiration of the Term of this Lease. If Tenant shall not dispute any item or items shown on Landlord’s statement within one hundred twenty (120) days after such notice, including Tenant's Proportionate Share of Tenant shall be deemed to have approved such statement and shall be estopped from contesting such statement or the amount due. If Tenant shall dispute any item or items included by Landlord in determining Operating Costs, Tenant shall nevertheless pay to Landlord in full the amount claimed by Landlord and shall not offset or withhold any payment while its dispute is pending. If such dispute is not amicably settled between Landlord and Tenant within thirty (30) days thereafter after such notice, either party may during the fifteen (15) days after the expiration of such thirty (30) day period refer such disputed item or items to a reputable firm of independent certified public accountants mutually acceptable to Landlord and Tenant for resolution, and the decision of such firm shall pay be conclusive and binding upon Landlord and Tenant. The expenses involved in such determination shall be borne by the party against whom a decision is rendered by such accountants, provided that if more than one item is disputed and the decision shall be against each party in respect to Landlordany item or number of items disputed, or Landlord then the expenses shall credit be apportioned according to the next rent payments due Landlord from Tenant, as the case may be, any difference between the actual Operating Costs and the estimated Operating Costs paid by Tenant. Tenant's Proportionate Share of Operating Costs for the years in which this Lease commences and terminates shall be prorated by multiplying the actual Operating Costs by a fraction the numerator of which is the number of days of that year monetary value of the Term and the denominator of which is 365. Notwithstanding any other provision herein to the contrary, it is agreed that in the event that the Project is not fully occupied at any time during the Term, an adjustment shall be made in computing the management fee component of the Operating Costs for such year so that the management fee component of the Operating Costs shall be computed for such year as though the Project had been fully occupied during such year. For a period of three (3) years following Tenant's receipt of Landlord's statement of actual Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in the offices where Landlord maintains its accounting records. No subtenant will have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result of the audititems decided against each party.
Appears in 1 contract
Operating Costs. Tenant shall, for the entire Lease Term, pay to Landlord as an item of additional rent, without any setoff set-off or deduction therefrom, its Proportionate Share Tenant's share of all costs ("Operating Costs") which Landlord may incur in owning, maintaining and operating the Project during for each calendar year of during the Lease Term. "Proportionate Share" is defined Said costs are referred to herein as the decimal equivalent of a fraction, the numerator of which is the rentable area of the Premises and the denominator of which is the rentable area within the entire Building. "Operating Costs" and are hereby defined to include all reasonable expenses and costs (include, but shall not specific costs which are separately billed to and paid by individual tenantsbe limited to, including Tenant) which the Landlord shall pay or become obligated to pay because of or in connection with the operation and maintenance of the Project and supporting facilities of the Project, including but not limited to all real estate taxes and annual installments of special assessments payable in such calendar year with respect to the Project; , maintenance, repair, replacement and care of all heating, lighting, plumbing and air conditioning fixtures, equipment and systems serving the common areas, parking and landscape areas, signs, snow removal, non-structural repair and maintenance of the exterior of the Building (including the costs of any contest of equipment purchased and used for such taxespurposes), including reasonable attorney's management fees; management fees (except that no management fee shall be charged during such period(s) that Tenant elects to maintain and manage the common areas pursuant to Section 10), insurance premiums, utility costs, security costs, costs of wages, maintenance costs (relating to the Project including sidewalks, landscaping and parking or service areas, common areas, service contractsservices, equipment and supplies) , and all other costs of any nature whatsoever which for federal tax purposes may be expensed rather than capitalized, all in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, costs of leasehold improvements tenant improvements, and payments of principal and interest on any mortgages, deeds of trusts, or other security devices mortgages covering the Project. Operating Costs shall also include any expenses or the yearly amortization of capital costs incurred by the Landlord for improvements or structural repairs to the Project required to comply with any change after the commencement date in the laws, rules or regulations of any governmental authority having jurisdiction, or for purposes purpose of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building components)Costs, which costs shall be amortized over the useful life of such improvements or repairs, as reasonably estimated by Landlord. Tenant's proportionate share of operating expenses shall be that fraction, the Landlord, but in no event in excess numerator of which is the savings. The management fee shall not exceed 3% area of Tenant's Base Rent Demised Premises and Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site manager, any administrative or overhead expenses, any special assessments or charges in the nature denominator of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with or as a consequence is the total area of the development of the ProjectBuilding. As soon as reasonably practicable prior to the commencement of each calendar year during the Lease Term, Landlord shall furnish to Tenant an estimate of Tenant's share of Operating Costs for the ensuing calendar year year, and Tenant's Proportionate Share thereof. Tenant shall pay, as additional rent hereunder together with each installment of Base Rentmonthly base rent, one-twelfth (1/12thl/12th) of its estimated annual Proportionate Share share of such Operating Costs. As soon as reasonably practicable after the end of each calendar year during the Term and in any event within 120 daysLease Term, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share share of Operating Costssuch amount, and within thirty (30) days thereafter thereafter, Tenant shall pay to Landlord, or Landlord shall credit to the next rent payments due Landlord from Tenant, Tenant as the case may be, any the difference between the such actual Operating Costs and the estimated excess Operating Costs paid by Tenant. Tenant's Proportionate Share share of such excess Operating Costs for the years in which this Lease commences and terminates terminates, and shall be prorated by multiplying based upon the actual Operating Costs by a fraction the numerator dates of which is the number of days of that year commencement and termination of the Term and the denominator of which is 365. Notwithstanding any other provision herein to the contrary, it is agreed that in the event that the Project is not fully occupied at any time during the Lease Term, an adjustment shall be made in computing the management fee component of the Operating Costs for such year so that the management fee component of the Operating Costs shall be computed for such year as though the Project had been fully occupied during such year. For a period of three (3) years following Tenant's receipt of Landlord's statement of actual Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in the offices where Landlord maintains its accounting records. No subtenant will have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result of the audit.
Appears in 1 contract
Operating Costs. (a) It is expressly agreed that Tenant shallwill pay in addition to Fixed Basic Rent provided in Paragraph 3 above, Additional Rent for the entire Term, pay to Landlord as an item all of additional rent, without any setoff or deduction therefrom, its Proportionate Share of costs ("Operating Costs") which Landlord may incur in maintaining and operating the Project during each calendar year of the Term. "Proportionate Share" is defined as the decimal equivalent of a fraction, the numerator of which is the rentable area of the Premises and the denominator of which is the rentable area within the entire Building. "Operating Costs" are defined to include all reasonable expenses and costs (but not specific costs which are separately billed to and paid by individual tenants, including Tenant) which the Landlord shall pay or become obligated to pay because of or in connection with the operation and maintenance of the Project and supporting facilities of the Project, including but not limited to all real estate taxes and annual installments of special assessments payable in such calendar year with respect to the Project; Landlord's costs of any contest of such taxes, including reasonable attorney's fees; management fees (except operating and maintaining the Building so that no management fee the Fixed Basic Rent shall be charged during such period(s) that Tenant elects absolutely net to maintain and manage the common areas pursuant to Section 10), insurance premiums, utility costs, security costs, costs of wages, maintenance costs (relating to the Project including sidewalks, landscaping and parking or service areas, common areas, service contracts, equipment and supplies) and all other costs of any nature whatsoever which for federal tax purposes may be expensed rather than capitalized, all in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, costs of leasehold improvements and payments of principal and interest on any mortgages, deeds of trusts, or other security devices covering the Project. Operating Costs shall also include the yearly amortization of capital costs incurred by the Landlord for improvements or structural repairs to the Project required to comply with any change after the commencement date in the laws, rules or regulations of any governmental authority having jurisdiction, or for purposes of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building components), which costs shall be amortized over the useful life of such improvements or repairs, as reasonably estimated by the Landlord, but except as otherwise specifically set forth in no event in excess of the savingsthis Lease. The management fee shall not exceed 3% of Tenant's Base Rent and Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site manager, any administrative or overhead expenses, any special assessments or charges in the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with or as a consequence of the development of the Project. As soon as reasonably practicable prior to the commencement of each calendar year during the Term, Landlord shall furnish to Tenant an estimate of Operating Costs for the ensuing calendar year and Tenant's Proportionate Share thereof. Tenant shall pay, as additional rent hereunder together with each installment of Base Rent, one-twelfth (1/12th) of its estimated annual Proportionate Share of Operating Costs. As soon as reasonably practicable after the end of each calendar year during the Term and in any event within 120 days, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share of Operating Costs, and within thirty (30) days thereafter Tenant shall pay to Landlord, as Additional Rent, Tenant's Percentage, as defined in the Preamble of all operating and maintenance costs incurred by Landlord for the Building and Office Building area for any Calendar Year (or proportionate part thereof if the Lease was not in effect during the entire Calendar Year ("Operating Costs Payment") Operating costs shall include, by way of illustration and not of limitation: personal property taxes; management fees at an initial rate of $40,000.00 with reasonable yearly increases thereafter of five (5%) percent; labor, including all wages and salaries; fringe benefits; social security taxes, and other taxes which may be levied against Landlord upon such wages and salaries; supplies; repairs and cleaning services, maintenance for structural and non-structural repairs whether ordinary or extraordinary; maintenance and service contracts; the cost of all HVAC, electric, water, sewer, gas and other utilities for the Building, common facilities and common areas not otherwise billed to Tenant, but not including utility and energy costs for which any other tenant is to pay separately pursuant to a check meter or other measuring device; painting; wall and window washing; laundry and towel service; tools and equipment; fire and other insurance, trash removal, repair, maintenance and replacement of roofs, parking area, curbs and walkways; snow removal; public amenities; and all other items properly constituting direct operating costs according to standard accounting practices, provided that the contract price charged to Landlord for all of the above shall credit be at commercially reasonable prices usually charged for similar buildings in similar locations (hereinafter collectively referred to as the "Operating Costs"), but not including, brokerage commissions, leasing commissions, finder's fees, space planner fees and other similar type fees, salaries and fringe benefits for Landlord's executives above the rank of building manager; costs of repairs or replacements incurred by reason of fire or other casualty or condemnation; costs for constructing a tenant installation for any individual tenant at the Building, or amounts contributed to any such tenant in lieu thereof, or any other tenant allowances granted as an inducement to enter into a lease; amounts received by Landlord through proceeds of insurance or by any manufacturer's warranty to the next rent payments due Landlord from Tenant, as extent the case may be, any difference between the actual proceeds are compensation for expenses which were previously included in Operating Costs hereunder; advertising and promotional expenditures; costs incurred or any specific compensation Landlord receives in performing work or funishing services for any new or existing tenant in the estimated Building;rent and other charges payable in connection with any ground or underlying lease; amounts paid to affiliates of Landlord in excess of the amounts that would have been paid absent such relationship; costs of any special services rendered to a tenant of the Building which is not rendered generally to tenants therein; interest or penalties for late payments by Landlord; refinancing costs; legal, appraisal and auditing fees and court costs in connection with leasing space in the Building or in connection with proceedings or applications to reduce real estate tax assessments; all expenses for which Landlord has received reimbursement and any fines or penalties imposed by legal authorities having jurisdiction thereof by reason of such existing violations; rent payable with respect to any leasing office; management fees in excess of those referred to herein; costs incurred in operating the parking facilities for the Building except to the extent the cost of operating the parking facilities exceeds the revenues generated from operating the parking facilities; and costs incurred to test, survey, cleanup, contain, abate, remoxx, xr otherwise remedy hazardous waste or asbestos-containing materials from the Property unless the waste or asbestos-containing materials were in or on the Property because of Tenant's negligence or willful acts or omissions; depreciation of Building; interest, points and fees on debt or amortization on any mortgage or mortgages encumbering the Building and/or the land on which the Building is situated; income or excess profits taxes; costs of maintaining Landlord's corporate existence; franchise taxes; and expenditures required to be capitalized for federal income tax purposes, inclusive of renovations to and replacement of the Building and equipment, (which expenditures shall be amortized over their useful life in accordance with generally accepted accounting principles, consistently applied, and such amortization shall be included as an Operating Cost expense), unless said expenditures are for the purpose of reducing Operating Costs paid by Tenant. within the Building and Building Area or are required under any governmental law, ordinance or regulation, in which event the costs thereof shall be included.
(b) Commencing as of the Commencement Date, Tenant shall pay its Tenant's Proportionate Share Percentage of the Operating Costs. Tenant shall make estimated payments on account of Tenant's Percentage of these Operating Costs in monthly installments in advance on the first (1st) day of each month, equal to One-Twelfty (1/12th) of Tenant's Percentage of the Landlord's expenditures for Operating Costs for the years Calendar Year or part thereof immediately preceding the year in which this Lease commences and terminates to be made. Monthly payments in the first full or partial Calendar Year commencing with the Commencement Date shall be prorated by multiplying the actual Operating Costs by a fraction the numerator of which is the number of days of that year of the Term and the denominator of which is 365. Notwithstanding any other provision herein to the contrary, it is agreed that in the event that the Project is not fully occupied at any time during the Term, an adjustment shall be made in computing the management fee component of the Operating Costs for such year so that the management fee component of the Operating Costs shall be computed for such year as though the Project had been fully occupied during such year. For a period of three TEN THOUSAND AND 00/100 (3) years following Tenant's receipt of Landlord's statement of actual Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in the offices where Landlord maintains its accounting records. No subtenant will have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result of the audit.$10,000.00)
Appears in 1 contract
Samples: Lease Agreement (Computer Outsourcing Services Inc)
Operating Costs. Tenant shall, for the entire Term, pay to Landlord as an item of additional rent, without any setoff or deduction therefrom, its Proportionate Share of costs ("Operating Costs") which Landlord may incur in maintaining and operating the Project during each calendar year ESCALATION. Tenant's proportionate share of the Term. "Proportionate Share" is defined as the decimal equivalent of Annual Estimated Operating Costs shall be determined by multiplying Annual Estimated Operating Costs by a fraction, the numerator of which is the rentable area Rentable Floor Area of the Premises Tenant's Space, and the denominator of which is the rentable area within Total Rentable Floor Area of the entire Building. "Operating Costs" are defined to include all reasonable expenses and costs (but not specific costs which are separately billed to and paid by individual tenants, including Tenant) which the Landlord shall pay or become obligated to pay because of or in connection with the operation and maintenance of the Project and supporting facilities of the Project, including but not limited to all real estate taxes and annual installments of special assessments payable in such calendar year with With respect to the Project; costs of First Fiscal Year for Tenant's Paying Operating Cost Escalation, or fraction thereof, and any contest of such taxesfiscal year or fraction thereof thereafter, including reasonable attorney's fees; management fees Tenant shall pay to Landlord, as additional rent, Operating Cost Escalation (except that no management fee shall be charged during such period(s) that Tenant elects to maintain and manage the common areas pursuant to Section 10as defined below), insurance premiumsif any, utility costs, security costs, costs on or before the thirtieth (30th) day following receipt by Tenant of wages, maintenance costs Landlord's Statement (relating to the Project including sidewalks, landscaping and parking or service areas, common areas, service contracts, equipment and supplies) and all other costs of any nature whatsoever which for federal tax purposes may be expensed rather than capitalized, all in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, costs of leasehold improvements and payments of principal and interest on any mortgages, deeds of trusts, or other security devices covering the Project. Operating Costs shall also include the yearly amortization of capital costs incurred by the Landlord for improvements or structural repairs to the Project required to comply with any change after the commencement date in the laws, rules or regulations of any governmental authority having jurisdiction, or for purposes of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building componentsas defined below), which costs shall be amortized over the useful life of such improvements or repairs, as reasonably estimated by the Landlord, but in no event in excess of the savings. The management fee shall not exceed 3% of Tenant's Base Rent and Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site manager, any administrative or overhead expenses, any special assessments or charges in the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with or as a consequence of the development of the Project. As soon as reasonably practicable prior to the commencement of each calendar year during the Term, Landlord shall furnish to Tenant an estimate of Operating Costs for the ensuing calendar year and Tenant's Proportionate Share thereof. Tenant shall pay, as additional rent hereunder together with each installment of Base Rent, one-twelfth (1/12th) of its estimated annual Proportionate Share of Operating Costs. As soon as reasonably practicable after the end of each calendar year Fiscal Year ending during the Term and in any event within 120 daysafter Lease termination, Landlord shall furnish to Tenant render a statement of the actual Operating Costs ("Landlord's Statement") in reasonable detail and according to usual accounting practices certified by Landlord and showing for the previous calendar year, including Tenant's Proportionate Share of Operating Costs, and within thirty (30) days thereafter Tenant shall pay to Landlord, preceding Fiscal Year or Landlord shall credit to the next rent payments due Landlord from Tenantfraction thereof, as the case may be, any difference between Xxxxxxxx's Operating Costs, excluding the actual Operating Costs interest and amortization on mortgages for the Building and Lot or leasehold interests therein and the estimated Operating Costs paid by cost of special services rendered to tenants (including Tenant. Tenant's Proportionate Share ) for which a special charge is made, but including, without limitation: real estate taxes on the Building and Lot; installments and interest on assessments for public betterments or public improvements; expenses of Operating Costs any proceedings for the years in which this Lease commences abatement of taxes and terminates shall be prorated by multiplying the actual Operating Costs by assessments with respect to any fiscal year or fraction of a fraction the numerator of which is the number of days of that year of the Term and the denominator of which is 365. Notwithstanding any other provision herein fiscal year; premiums for insurance; fees payable to the contrary, it is agreed that in the event that the Project is not fully occupied at any time during the Term, an adjustment shall be made in computing the management fee component of the Operating Costs third parties for such year so that the management fee component of the Operating Costs shall be computed for such year as though the Project had been fully occupied during such year. For a period of three (3) years following Tenant's receipt financial audits of Landlord's statement Operating Costs; compensation and all fringe benefits, worker's compensation insurance premiums and payroll taxes paid by Landlord to, for or with respect to all persons engaged in the operating, maintaining, or cleaning of actual the Building and Lot; all utility charges not billed directly to tenants by Landlord or the utility; payments to independent contractors under service contracts for cleaning, operating, managing, maintaining and repairing the Building and Lot (which payments may be to affiliates of Landlord provided the same are at reasonable rates consistent with the type of occupancy and the services rendered) rent paid by the managing agent or imputed cost equal to the loss of rent by Landlord for making available to the managing agent space for a Building office on the ground floor or above; if the Building shares common areas or facilities with another building or buildings, the Buildings' pro rata share (as reasonably determined by Landlord) of the cost of cleaning, operating, managing (including the cost of the management office for such buildings and facilities), maintaining and repairing such common areas and facilities; and all other reasonable and necessary expenses paid in connection with the cleaning, operating, managing, maintaining and repairing of the Building and Lot, or either, and properly chargeable against income, it being agreed that if Landlord installs a new or replacement capital item for the purpose of reducing Landlord's Operating Costs, Landlord the cost thereof as reasonably amortized in accordance with generally accepted accounting practices by ---------------------------------------------------------- Landlord, with interest at the average prime commercial rate in effect from time to time at the three largest national banks in Boston, Massachusetts on the unamortized amount, shall keep available for Tenantbe included in Landlord's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in Statement shall also show the offices where Landlord maintains its accounting records. No subtenant will have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy average number of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result square feet of the auditBuilding which were occupied for the preceding fiscal year or fraction thereof.
Appears in 1 contract
Samples: Lease Agreement (Photoelectron Corp)
Operating Costs. Tenant shallshall pay directly, for or to Landlord, as applicable, all Operating Costs (defined below) of the entire TermProperty in a timely manner and prior to delinquency. In the event Tenant fails to pay any Operating Cost within ten (10) days after written notice by Landlord to Tenant, and without being under any obligation to do so and without waiving any default by Tenant, Landlord may pay to Landlord as an item of additional rent, without any setoff or deduction therefrom, its Proportionate Share of costs ("delinquent Operating Costs") which Landlord may incur in maintaining and operating the Project during each calendar year of the Term. "Proportionate Share" is defined as the decimal equivalent of a fraction, the numerator of which is the rentable area of the Premises and the denominator of which is the rentable area within the entire Building. "Any Operating Costs" are defined to include all reasonable expenses and costs (but not specific costs which are separately billed to and Cost paid by individual tenants, including Tenant) which the Xxxxxxxx and any expenses reasonably incurred by Landlord shall pay or become obligated to pay because of or in connection with the payment of the delinquent Operating Cost, together with interest thereon at the Overdue Rate from the date paid by Landlord until the date repaid by Xxxxxx, may be billed immediately to Tenant, or at Landlord’s option and upon written notice to Tenant, may be deducted from the Security Deposit. “Operating Costs” means all costs and expenses relating to the ownership, maintenance and operation of the Property including, but not limited to: insurance, maintenance, repair and replacement of the foundation, roof, walls, heating, ventilation, air conditioning, plumbing, electrical, mechanical, utility and safety systems, paving and parking areas, roads and driveways; maintenance, repair and replacement of exterior areas such as gardening and landscaping, snow removal and signage; maintenance, repair and replacement of roof membrane, flashings, gutters, downspouts, roof drains, skylights and waterproofing; painting; lighting; cleaning; refuse removal; security; utilities for, or the maintenance of, outside areas; building personnel costs; asset, property or administrative management fees incurred or attributable to the management of the Property; the costs, expenses, charges and assessments related to or arising from any covenants, conditions and restrictions affecting the Premises, or other matters of record; rentals or lease payments paid by Landlord for rented or leased personal property used in the operation or maintenance of the Project Premises; and supporting facilities of the Project, including but not limited to all real estate taxes fees for required licenses and annual installments of special assessments payable in such calendar year with respect to the Project; costs of any contest of such taxes, including reasonable attorney's fees; management fees (except that no management fee shall be charged during such period(s) that Tenant elects to maintain and manage the common areas pursuant to Section 10), insurance premiums, utility costs, security costs, costs of wages, maintenance costs (relating to the Project including sidewalks, landscaping and parking or service areas, common areas, service contracts, equipment and supplies) and all other costs of any nature whatsoever which for federal tax purposes may be expensed rather than capitalized, all in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, costs of leasehold improvements and payments of principal and interest on any mortgages, deeds of trusts, or other security devices covering the Project. Operating Costs shall also include the yearly amortization of capital costs incurred by the Landlord for improvements or structural repairs to the Project required to comply with any change after the commencement date in the laws, rules or regulations of any governmental authority having jurisdiction, or for purposes of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building components), which costs shall be amortized over the useful life of such improvements or repairs, as reasonably estimated by the Landlord, but in no event in excess of the savingspermits. The management fee shall not exceed 3% of Tenant's Base Rent terms “Operating Costs” and Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses “Additional Rent” shall not include any compensation costs and expenses relating to the off-site improvements described on Exhibit E, the on-site improvements described on Exhibit F, or benefits for any off-site managerimprovements related to or arising from any covenants, any administrative or overhead expenses, any special assessments or charges in conditions and restrictions affecting the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with or as a consequence of the development of the Project. As soon as reasonably practicable prior to the commencement of each calendar year during the Term, Landlord shall furnish to Tenant an estimate of Operating Costs for the ensuing calendar year and Tenant's Proportionate Share thereof. Tenant shall pay, as additional rent hereunder together with each installment of Base Rent, one-twelfth (1/12th) of its estimated annual Proportionate Share of Operating Costs. As soon as reasonably practicable after the end of each calendar year during the Term and in any event within 120 days, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share of Operating Costs, and within thirty (30) days thereafter Tenant shall pay to Landlord, or Landlord shall credit to the next rent payments due Landlord from Tenant, as the case may be, any difference between the actual Operating Costs and the estimated Operating Costs paid by Tenant. Tenant's Proportionate Share of Operating Costs for the years in which this Lease commences and terminates shall be prorated by multiplying the actual Operating Costs by a fraction the numerator of which is the number of days of that year of the Term and the denominator of which is 365. Notwithstanding any other provision herein to the contrary, it is agreed that in the event that the Project is not fully occupied at any time during the Term, an adjustment shall be made in computing the management fee component of the Operating Costs for such year so that the management fee component of the Operating Costs shall be computed for such year as though the Project had been fully occupied during such year. For a period of three (3) years following Tenant's receipt of Landlord's statement of actual Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in the offices where Landlord maintains its accounting records. No subtenant will have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result of the auditPremises.
Appears in 1 contract
Samples: Absolute Net Ground Lease Agreement (Zoned Properties, Inc.)
Operating Costs. Tenant shall, for the entire Lease Term, pay to Landlord Lessor as an item of additional rent, without any setoff or deduction therefrom, its Proportionate Share of any and all costs and expenses which Lessor or Lessor's manager may incur because of or in connection with the Lessorship, maintenance, management and operation of the Land and/or the Building ("Operating Costs") which Landlord may incur in maintaining and operating the Project during each calendar year of the Term). "Proportionate Share" is defined as the decimal portion of Operating Costs equivalent to a fraction of a fractionthe total thereof, the numerator of which is the number of net rentable area of square feet comprising the Demised Premises and the denominator of which is the greater of (i) the number of net rentable area square feet actually leased within the entire Building, or (ii) ninety-five percent (95%) of the number of net rentable square feet contained within the Building. "Operating Costs" are defined to include all reasonable expenses and costs (but not specific costs which are separately billed to and paid by individual tenants, including Tenant) of every kind and nature which the Landlord Lessor or Lessor's manager shall pay or become obligated to pay because of or in connection with the Lessorship, maintenance, management and operation and maintenance of the Project Land, the Building and supporting facilities of the ProjectBuilding, including but not limited to all real estate taxes and annual installments of special or other assessments payable in such calendar year with respect to thereto, and all other taxes, service payments in lieu of taxes, exercises, levies, fees, or charges, general and special, ordinary and extraordinary, of any kind, which are assessed, levied, charged, confirmed or imposed by any public authority upon the ProjectLand and/or the Building, its operations or the rent provided for in this Lease; the cost of protesting any such taxes; management fees; insurance premiums; utility costs; janitorial costs; Building security costs; costs of any contest of such taxes, including reasonable attorney's fees; management fees (except that no management fee shall be charged during such period(s) that Tenant elects to maintain wages and manage the common areas pursuant to Section 10), insurance premiums, utility costs, security costs, costs of wages, maintenance costs (relating to the Project Building (including but not limited to sidewalks, skyways, landscaping and parking or service areas, common areas, ); services; service contracts, ; equipment and supplies) ; and all other costs of any nature whatsoever which for federal tax purposes may be expensed rather than capitalized, all in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, costs of leasehold tenant improvements and payments of principal and interest on any mortgages, deeds of trusts, or other security devices covering the ProjectBuilding. Operating Costs shall also include the yearly amortization amortized portion of capital costs incurred by the Landlord Lessor for improvements or structural repairs to the Project Building required to comply with any change after the commencement date in the laws, rules or regulations of any governmental authority having jurisdiction, or for purposes of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building components)Costs, which costs shall be amortized over the useful life of such improvements or repairs, as reasonably estimated by the Landlord, but in no event in excess of the savings. The management fee shall not exceed 3% of TenantLessor or by Lessor's Base Rent and Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site property manager, any administrative or overhead expenses, any special assessments or charges in the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with or as a consequence of the development of the Project. As soon as reasonably practicable prior to the commencement of the Lease Term and prior to the commencement of each ensuing calendar year during the Lease Term, Landlord Lessor shall furnish to Tenant an estimate of Operating Costs for the first calendar year included in whole or in part in the Lease Term and each ensuing calendar year and Tenant's Proportionate Share thereofyear. Tenant shall pay, as additional rent hereunder hereunder, together with each installment of Base Rent, one-twelfth (1/12th) of its estimated annual Proportionate Share of Operating Costs. As soon as reasonably practicable after the end of each calendar year during included in whole or in part in the Term and in any event within 120 daysLease Term, Landlord Lessor shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share of Operating Costs, and within thirty (30) days thereafter Tenant shall pay to LandlordLessor, or Landlord Lessor shall credit to the next rent payments due Landlord Lessor from Tenant, as the case may be, any difference between the actual Operating Costs payable by Tenant hereunder and the estimated Operating Costs paid by Tenant. Tenant's Proportionate Share of Operating Costs for the years in which this Lease commences and terminates shall be prorated by multiplying based upon the actual Operating Costs by a fraction the numerator dates of which is the number of days of that year commencement and termination of the Term and the denominator of which is 365Lease Term. Notwithstanding any other provision herein to the contrary, it is agreed that in the event that the Project Building is not fully occupied at any time during the Lease Term, an adjustment shall be made in computing the management fee component of the Operating Costs for such year so that the management fee component of the Operating Costs shall be computed for such year as though the Project Building had been fully occupied during such year (including, for real estate tax purposes, as if fully occupied and assessed as a completed Building during such year). For a period Notwithstanding any provision herein that may be construed to the contrary, Lessor shall have the right, in its reasonable discretion, to determine, from time to time, the method of three (3) years following Tenant's receipt of Landlord's statement of actual computing Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's the allocation of Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in various types of space within the offices where Landlord maintains its accounting records. No subtenant will have Building and/or the right to audit under this provision. An assignee may have Project, the right to audit as provided herein, however, such right shall only apply extent of the appurtenances to the assignee's term pursuant to Building and/or the LeasePro . In ect, and the event a discrepancy of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result rentable area of the auditDemised Premises, the Building and the Project, and Tenant shall be bound thereby.
Appears in 1 contract
Operating Costs. (a) As additional Rent, Tenant shall, for the entire Term, shall pay to Landlord as an item of additional rent, without any setoff or deduction therefrom, its Proportionate Tenant’s Share of costs ("all Operating Costs". The purposes of this Lease, the term “Tenant’s Share” shall mean one hundred percent (100%) which Landlord may incur in maintaining and operating the Project during each calendar year of the TermOperating Costs incurred by Landlord with respect to the Project. "Proportionate Share" is defined as the decimal equivalent of a fraction, the numerator of which is the rentable area of the Premises and the denominator of which is the rentable area within the entire Building. "The term “Operating Costs" are defined to include all reasonable expenses and costs (but not specific costs which are separately billed to and ” means the total amounts paid or payable by individual tenants, including Tenant) which the Landlord shall pay or become obligated to pay because of or others in connection with the ownership, maintenance, repair, and operation of the Building and the Project in a quality, first class condition, and includes, but is not limited to, all charges allocable to the Project pursuant to any covenants, conditions and restrictions and/or reciprocal easement agreements governing the use and maintenance of the Project (“CC&Rs”); Taxes (as hereinafter defined); the amount paid for all hot and supporting facilities cold water to the Building Exterior Areas of the Project; the amount paid for Project lighting; the amount paid for all labor and/or wages and other employment related payments, including but not limited cost to all real estate taxes Landlord of workmen’s compensation and annual installments disability insurance, payroll taxes, welfare, and fringe benefits made to janitors, employees, building managers, contractors, and subcontractors of special assessments payable the Landlord involved in the operation, maintenance, repair, and restoration of the Project to the extent such persons were involved in such calendar year with respect activities; the cost of maintenance and repair of the landscaping, sidewalks and other Building Exterior Areas; the amount paid for maintaining and repairing plumbing servicing the Building Exterior Areas, alarm and security systems and personnel (if any), including the cost of preventative maintenance contracts; modifications to the Building Exterior Areas occasioned by any rules, regulations, or laws effective regardless of whether prior to or subsequent to the Commencement Date; permits, licenses, and certificates necessary to operate and manage the Project; managerial fees and managerial, administrative expenses; the total charges of any independent contractors employed in the care and operation, maintenance, cleaning, repair, and restoration of the Project; the amounts paid for all supplies, tools, equipment, and necessities which are occasioned by everyday wear and tear; the costs of any contest cleaning; the cost of such taxes, including reasonable attorney's fees; management fees (except that no management fee shall be charged during such period(s) that Tenant elects accounting services necessary to maintain and manage compute charges payable by the common areas pursuant to Section 10), insurance premiums, utility costs, security costs, costs tenants of wages, maintenance costs (relating to the Project including sidewalks, landscaping and parking or service areas, common areas, service contracts, equipment and supplies) and all other costs of any nature whatsoever which for federal tax purposes may be expensed rather than capitalized, all in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, costs of leasehold improvements and payments of principal and interest on any mortgages, deeds of trusts, or other security devices covering the Project; legal, inspection, and consulting services; and the amount paid for premiums for all insurance obtained by Landlord or required by Landlord’s mortgagees. For purposes of this Lease and for the avoidance of doubt, Operating Costs shall also include the yearly amortization sum of capital costs all costs, expenses, and disbursements, of every kind and nature whatsoever, and the Taxes, incurred by the Landlord for improvements or structural repairs to the Project required to comply with any change after the commencement date in the laws, rules or regulations of any governmental authority having jurisdiction, or for purposes of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building components), which costs shall be amortized over the useful life of such improvements or repairs, as reasonably estimated by the Landlord, but in no event in excess of the savings. The management fee shall not exceed 3% of Tenant's Base Rent and Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site manager, any administrative or overhead expenses, any special assessments or charges in the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with the ownership, management, maintenance, operation, administration and repair of all or as a consequence any portion of the development of the Building or Project. As soon as reasonably practicable prior to the commencement of each calendar year during the Term, Landlord shall furnish to Tenant an estimate of Operating Costs for the ensuing calendar year and Tenant's Proportionate Share thereof. Tenant shall pay, as additional rent hereunder together with each installment of Base Rent, one-twelfth (1/12th) of its estimated annual Proportionate Share of Operating Costs. As soon as reasonably practicable after the end of each calendar year during the Term and in any event within 120 days, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share of Operating Costs, and within thirty (30) days thereafter Tenant shall pay to Landlord, or Landlord shall credit to the next rent payments due Landlord from Tenant, as the case may be, any difference between the actual Operating Costs and the estimated Operating Costs paid by Tenant. Tenant's Proportionate Share of Operating Costs for the years in which this Lease commences and terminates shall be prorated by multiplying the actual Operating Costs by a fraction the numerator of which is the number of days of that year of the Term and the denominator of which is 365. Notwithstanding any other provision herein to the contrary, it is agreed that in the event that the Project is not fully occupied at any time during the Term, an adjustment shall be made in computing the management fee component of the Operating Costs for such year so that the management fee component of the Operating Costs shall be computed for such year as though the Project had been fully occupied during such year. For a period of three (3) years following Tenant's receipt of Landlord's statement of actual Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in the offices where Landlord maintains its accounting records. No subtenant will have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result of the audit.
Appears in 1 contract
Operating Costs. Tenant shallAll costs incurred by Landlord in the ownership, for management, maintenance, repair, replacement, improvement, alteration and operation of the entire TermBuilding and Project, pay to Landlord as an item of additional rentincluding, without any setoff or deduction therefromlimitation, its Proportionate Share of costs the following: ("Operating Costs"a) which Landlord may incur utilities; (b) supplies, tools, equipment and materials used in maintaining the operation, repair and operating the Project during each calendar year maintenance of the Term. "Proportionate Share" is defined as Building or the decimal equivalent Project; (c) landscaping; (d) parking area repair and maintenance, including, but not limited to, resurfacing not more than once every five years (the cost of a fractionresurfacing shall be amortized, including interest at the numerator of which is Interest Rate on the rentable area unamortized cost, over the useful life of the Premises resurfacing as reasonably determined by landlord), repairs, re-striping, and the denominator cleaning; (e) fees, charges and other costs, including, without limitation, reasonable consulting fees, legal fees and accounting fees, of which is the rentable area within the entire Building. "Operating Costs" are defined to include all reasonable expenses and costs (but not specific costs which are separately billed to and paid contractors engaged by individual tenants, including Tenant) which the Landlord shall pay or become obligated to pay because of or otherwise reasonably incurred by Landlord in connection with the operation management, operation, maintenance and maintenance repair of the Project Building or the Project; (1) reasonable compensation (including, without limitation, employment taxes and supporting facilities fringe benefits) of all persons (limited to the level of property manager and below) who perform duties in connection with the operation, maintenance, repair, or overhaul of the Building or the Project, and equipment, improvements, and facilities located within the Project; (g) operation, repair, maintenance and replacement of Building Systems; (h) janitorial service, fire alarm, window cleaning and trash removal; (i) repair and replacement of building standard surfaces, including but not limited to all real estate taxes wall and annual installments floor coverings, ceiling tiles, window coverings and fixtures; (j) maintenance and replacement of special assessments payable curbs and walkways; (k) repair of the roof; (l) Building signage and directories; (m) management of the Building or the Project, whether by Landlord or an independent contractor, the fee for which Tenant is obligated to pay shall not exceed [***] of Tenant’s Base Rent and Operating Costs; (n) rental expenses for (or a reasonable depreciation allowance on) personal property used in such calendar year with respect to maintenance, operation or repair of the Building or the Project; costs (o) licenses, certificates, permits and inspections and the cost of any contest of such taxes, including reasonable attorney's fees; management fees (except that no management fee shall be charged during such period(s) that Tenant elects to maintain and manage contesting the common areas pursuant to Section 10), insurance premiums, utility costs, security costs, costs of wages, maintenance costs (relating to the Project including sidewalks, landscaping and parking validity or service areas, common areas, service contracts, equipment and supplies) and all other costs of any nature whatsoever which for federal tax purposes may be expensed rather than capitalized, all in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, costs of leasehold improvements and payments of principal and interest on any mortgages, deeds of trusts, or other security devices covering the Project. Operating Costs shall also include the yearly amortization of capital costs incurred by the Landlord for improvements or structural repairs to the Project required to comply with any change after the commencement date in the laws, rules or regulations applicability of any governmental authority having jurisdictionenactments that may affect Operating Costs; (p) any costs, expenditures, or charges required by any governmental or quasi-governmental authority; (q) capital expenses that are incurred for purposes labor saving devices or to effect other savings in the operation or maintenance of reducing Operating Costs the Building or the Project, or any portion thereof (other than by “Cost Saving Capital Improvements”); (r) capital expenses (including costs to replace or retrofit) that are incurred as a result of requirements under any Law (“Required Capital Improvements”); and (s) capital expenses that are in Landlord’s reasonable opinion necessary for operation, repair, maintenance and replacement of worn out Building Systems, or the Project, or any portion thereof, in good condition and obsolete equipment or building components), which costs repair. All capital expenses shall be amortized (including interest at the Interest Rate on the unamortized cost) over the useful life of such improvements or repairs, the capital item as Landlord shall reasonably estimated by the Landlord, but determine and in no event in excess of the savingsaccordance with GAAP (“Amortized Capital Expenses”). The management fee Landlord shall not exceed 3% of Tenant's Base Rent and use its best efforts to minimize Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site manager, any administrative or overhead expenses, any special assessments or charges in the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection a manner consistent with or as a consequence of the development of the Project. As soon as reasonably practicable prior to the commencement of each calendar year during the Term, Landlord shall furnish to Tenant an estimate of Operating Costs for the ensuing calendar year and Tenant's Proportionate Share thereof. Tenant shall pay, as additional rent hereunder together with each installment of Base Rent, one-twelfth (1/12th) of its estimated annual Proportionate Share of Operating Costs. As soon as reasonably practicable after the end of each calendar year during the Term and in any event within 120 days, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share of Operating Costsgood business practices, and within thirty (30) days thereafter Tenant there shall pay be no duplication in charges to Landlord, or Landlord shall credit to the next rent payments due Landlord from Tenant, as the case may be, any difference between the actual Operating Costs and the estimated Operating Costs paid by Tenant. Tenant's Proportionate Share of Operating Costs for the years in which this Lease commences and terminates shall be prorated by multiplying the actual Operating Costs by a fraction the numerator of which is the number of days of that year of the Term and the denominator of which is 365. Notwithstanding any other provision herein to the contrary, it is agreed that in the event that the Project is not fully occupied at any time during the Term, an adjustment shall be made in computing the management fee component of the Operating Costs for such year so that the management fee component of the All Operating Costs shall be computed based upon competitive charges for such similar services and/or materials that are available in the general geographical area of the Building. Notwithstanding the foregoing, for purposes of this Lease, “Operating Costs” shall not include:
2.24.1 Amortized Capital Expenses in excess of [***] per rentable square foot of the Premises per year as though the Project had been fully occupied during such year. For a period of three (3) years following Tenant's receipt of Landlord's statement of actual shall not be included on Operating Costs, Landlord shall keep available provided, however (i) Amortized Capital Expenses for Tenant's inspection and/or audit complete books and records relating Required Capital Improvements, (ii) Amortized Capital Expenses for Cost Saving Capital Improvements to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's the extent that the Cost Saving Capital Improvements actually decrease Operating Costs books or Tenant’s expenses, and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in the offices where Landlord maintains its accounting records. No subtenant will have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy (iii) amortization of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If resurfacing the audit discloses an overcharge by Landlordparking lot, shall not be subject to the [***] per rentable square foot per year cap.
2.24.2 Costs (including permit, license and inspection costs) incurred in renovating or otherwise improving, decorating or redecorating rentable space for other tenants or vacant rentable space;
2.24.3 Utilities or services sold to Tenant or others for which Landlord shall reimburse Tenant for such overcharge within twenty is entitled to and actually receives reimbursement (20) days, unless Landlord disputes other than through any operating cost reimbursement provision similar to the result of the audit.provisions set forth in this Lease);
Appears in 1 contract
Samples: Office Lease (Biodesix Inc)
Operating Costs. Tenant shall, for the entire Term, pay to Landlord as an item of additional rent, without any setoff or deduction therefrom, its Proportionate Share of costs ("The term “Operating Costs") which Landlord may incur in maintaining and operating ” shall mean the Project during each calendar year total of all of the Term. "Proportionate Share" is defined as costs incurred by Landlord relating to the decimal equivalent of a fractionownership, the numerator of which is the rentable area of the Premises and the denominator of which is the rentable area within the entire Building. "Operating Costs" are defined to include all reasonable expenses and costs (but not specific costs which are separately billed to and paid by individual tenantsoperation, including Tenant) which the Landlord shall pay or become obligated to pay because of or in connection with the operation and maintenance of the Project Land and supporting facilities Building and the services provided to all tenants in the Building. By way of explanation and clarification, but not by way of limitation, Operating Costs will include without limitation the costs and expenses incurred for the following: Real Estate Taxes, including the cost to appeal or contest any Real Estate Taxes; pest control; trash and garbage removal (including dumpster rental); xxxxxx and matron service; security; Common Areas decorations; repairs, maintenance, and alteration of building systems, Common Areas, the Land, and portions of the ProjectBuilding to be maintained by Landlord; amounts paid under easements or other recorded agreements affecting the Building, including but not limited assessments paid to all real estate taxes any property owners’ associations; repairs, maintenance, replacements, and annual installments of special assessments payable in such calendar year with respect improvements to the ProjectBuilding and other improvements on the Land; costs of any contest of such taxesimprovements or alterations required by law; improvements in security systems; materials, tools, supplies, and equipment to enable Landlord to supply services that Landlord would otherwise have obtained from a third party; expenditures designed to result in savings or reductions in Operating Costs; landscaping, including reasonable attorney's fertilization and irrigation supply; parking area maintenance; property management fees; an onsite management fees office; all utilities serving the Common Areas and other non-leased areas and not separately billed to or reimbursed by any tenant of the Building; cleaning; window washing, and janitorial services; all insurance customarily carried by owners of comparable buildings or required by any mortgagee of the Building; supplies; service and maintenance contracts for the Building; wages, salaries, and other benefits of employees of the Landlord up to and including the building manager (except that no management fee including a pro rata share only of the wages and benefits of employees who are employed at more than one building, which pro rata share shall be charged during such period(s) determined by Landlord and shall be based on Landlord’s estimate of the percentage of time spent by the employees at the Building); legal, accounting, and administrative costs; and uniforms and working clothes for employees and the cleaning of them. Landlord may contract for the performance of some or all of the management and maintenance functions generally described in this section with entities that Tenant elects to maintain and manage the common areas pursuant to Section 10), insurance premiums, utility costs, security costs, costs of wages, maintenance costs (relating to the Project including sidewalks, landscaping and parking or service areas, common areas, service contracts, equipment and supplies) and all other costs of any nature whatsoever which for federal tax purposes may be expensed rather than capitalized, all in accordance are affiliated with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, costs of leasehold improvements and payments of principal and interest on any mortgages, deeds of trusts, or other security devices covering the ProjectLandlord. Operating Costs shall also include an allocated share of costs which relate to amenities not exclusively serving the yearly amortization Building, such as, but not limited to, parking facilities. Landlord will make the allocations of capital these costs incurred by the Landlord for improvements or structural repairs to the Project Building in good faith. However, Tenant specifically acknowledges that the making of allocations requires the exercise of business judgment which could be subject to differing opinions. Accordingly, Landlord’s allocations will be upheld unless Tenant can prove that the allocations have been make in bad faith and are arbitrary and discriminatory as to Tenant. Operating costs shall exclude expenditures for (i) capital improvements, except (a) those required to comply with any change by laws enacted after the commencement date Date of this Lease; (expenditures for materials, tools, supplies, and equipment purchased by Landlord to enable Landlord to supply services that Landlord would otherwise have obtained from a third party, and (c) replacement of non-structural items in the lawsCommon Areas, rules or regulations in any of any governmental authority having jurisdiction, or for purposes which cases the cost of reducing the capital improvements shall be included in Operating Costs (other than by replacement of worn out for the year in which the cost is incurred and obsolete equipment or building components)subsequent years, which costs shall be amortized on a straight-line basis over the useful life of such improvements or repairs, as reasonably estimated by the Landlordan appropriate period, but in no event more than ten years, and (ii) legal costs incurred in excess negotiating or enforcing leases against tenants, disputes with tenants, or legal costs associated with general operation of the savingsentity comprising Landlord, including attorney’s fees. The management fee shall not exceed 3% of Tenant's Base Rent and Capital Improvements intended to result in savings or reductions in Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site managerCosts, any administrative or overhead expenses, any special assessments or charges in will be included within the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with or as a consequence of the development of the Project. As soon as reasonably practicable prior to the commencement of each calendar year during the Term, Landlord shall furnish to Tenant an estimate definition of Operating Costs for the ensuing calendar year in which the costs are incurred and Tenant's Proportionate Share thereofsubsequent years, amortized on a straight-line basis over an appropriate period but in no event more than ten (10) years. Tenant shall pay, as additional rent hereunder together with each installment If Landlord leases any item of Base Rent, one-twelfth (1/12th) of its estimated annual Proportionate Share of capital equipment designed to result in savings or reductions in Operating Costs. As soon as reasonably practicable after , then the end of each calendar year during rent and other costs paid under the Term and leasing arrangement shall be included in any event within 120 days, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share of Operating Costs, and within thirty (30) days thereafter Tenant shall pay to Landlord, or Landlord shall credit to the next rent payments due Landlord from Tenant, as the case may be, any difference between the actual Operating Costs and the estimated Operating Costs paid by Tenant. Tenant's Proportionate Share of Operating Costs for the years year in which this Lease commences and terminates shall be prorated by multiplying the actual Operating Costs by a fraction the numerator of which is the number of days of that year of the Term and the denominator of which is 365. Notwithstanding any other provision herein to the contrary, it is agreed that in the event that the Project is not fully occupied at any time during the Term, an adjustment shall be made in computing the management fee component of the Operating Costs for such year so that the management fee component of the Operating Costs shall be computed for such year as though the Project had been fully occupied during such year. For a period of three (3) years following Tenant's receipt of Landlord's statement of actual Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in the offices where Landlord maintains its accounting records. No subtenant will have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result of the auditthey are incurred.
Appears in 1 contract
Samples: Lease (Alynx, Co.)
Operating Costs. Tenant shall, for (a) Prior to the entire Term, pay to Landlord as an item of additional rent, without any setoff or deduction therefrom, its Proportionate Share of costs ("Operating Costs") which Landlord may incur in maintaining and operating the Project during each calendar year commencement of the Term. "Proportionate Share" is defined as the decimal equivalent Term of a fractionthis Lease, the numerator of which is the rentable area of the Premises and the denominator of which is the rentable area within the entire Building. "Operating Costs" are defined to include all reasonable expenses and costs (but not specific costs which are separately billed to and paid by individual tenants, including Tenant) which the Landlord shall pay or become obligated to pay because of or in connection with the operation and maintenance of the Project and supporting facilities of the Project, including but not limited to all real estate taxes and annual installments of special assessments payable in such calendar year with respect to the Project; costs of any contest of such taxes, including reasonable attorney's fees; management fees (except that no management fee shall be charged during such period(s) that Tenant elects to maintain and manage the common areas pursuant to Section 10), insurance premiums, utility costs, security costs, costs of wages, maintenance costs (relating to the Project including sidewalks, landscaping and parking or service areas, common areas, service contracts, equipment and supplies) and all other costs of any nature whatsoever which for federal tax purposes may be expensed rather than capitalized, all in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, costs of leasehold improvements and payments of principal and interest on any mortgages, deeds of trusts, or other security devices covering the Project. Operating Costs shall also include the yearly amortization of capital costs incurred by the Landlord for improvements or structural repairs to the Project required to comply with any change after the commencement date in the laws, rules or regulations of any governmental authority having jurisdiction, or for purposes of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building components), which costs shall be amortized over the useful life of such improvements or repairs, as reasonably estimated by the Landlord, but in no event in excess of the savings. The management fee shall not exceed 3% of Tenant's Base Rent and Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site manager, any administrative or overhead expenses, any special assessments or charges in the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with or as a consequence of the development of the Project. As soon as reasonably practicable prior to the commencement of each calendar year during the TermTerm of this Lease, Landlord shall furnish to may, at its option, provide Tenant an with a then current estimate of Operating Costs for the ensuing upcoming calendar year year, and Tenant's Proportionate Share thereof. thereafter Tenant shall pay, as additional rent hereunder together with each installment of Base Additional Rent, one-twelfth (1/12th) in monthly installments in accordance with this Section 5, Tenant s Proportionate Share of the Landlord s estimate of the Operating Costs for the calendar year in question. Payments of Tenant s Proportionate Share of the Landlord s estimate of the Operating Costs shall be due and payable at the same time as Base Rent in accordance with Section 4 of this Lease. Landlord reserves the right to revise its estimate of Operating Costs from time to time during the calendar year by giving Tenant written notice to that effect. Thereafter, Tenant shall pay Additional Rent, in each of the remaining months of that year, in accordance with the revised estimate. The failure of Landlord to estimate Operating Costs and bill Tenant on a monthly basis shall in no event relieve Tenant of its estimated annual obligation to pay the Tenant s Proportionate Share of Operating Costs. As soon Operating Costs means the aggregate of all expenses paid or incurred by or on behalf of Landlord, whether structural, non-structural, foreseen or unforeseen, relating to the ownership, maintenance, repair, management and operation of the Buildings and Land and any sidewalks or any other areas related to the Buildings and Land which Landlord has a repair or maintenance obligation, determined on an accrual basis in accordance with generally accepted industry accounting standards, including, but not limited to, the following:
1) Wages and salaries of all employees engaged in the operation and maintenance of the Buildings and Land, including taxes, insurance and benefits relating thereto; provided, however, to the extent that such employees are engaged in the operation or maintenance of other projects, the wages and salaries of such employees shall be equitably allocated among all such projects such that only that portion of the wages and salaries of such employees allocable to the Buildings shall be included for purposes of calculating Operating Costs;
2) Costs of all supplies and materials used in the operation, maintenance, repair and management of the Buildings and Land; provided, however, to the extent that such supplies and materials are used in the operation or maintenance of other projects, the cost of such supplies and materials shall be equitably allocated among all such projects such that only that portion of the cost of the supplies and materials allocable to the Buildings shall be included for purposes of calculating Operating Costs;
3) Costs of water, sewage, power, heating, lighting, air conditioning, ventilating, and other utilities furnished in connection with the operation of the Buildings and Land (excluding any costs billed to specific tenants);
4) Costs of all maintenance and service agreements for the Buildings and Land, including, but not limited to, security service, alarm service, window cleaning service, janitorial service, landscape maintenance, pest control and elevator maintenance;
5) Costs to maintain and repair the Structural Members (as reasonably practicable after defined in Section 10.A.) of the end Buildings as well as the common elements of each calendar the Building;
6) Costs of all insurance carried by Landlord relating to the Buildings and Land, including, but not limited to, fire and extended coverage insurance, rental interruption insurance and liability insurance applicable to the Buildings and Land and Landlord s personal property used in connection therewith, together with any deductibles thereon, if applicable, together with any costs incurred by Landlord to recover insurance proceeds or settle insurance claims. In the event that during any operating year during all or any part of such coverage is written under a blanket policy or otherwise in such manner that Landlord was not charged a specific insurance premium applicable solely to the Term Buildings and Land, then in such event, the amount considered to be the insurance premiums with respect to such coverage for such operating year shall be determined in good faith by Landlord. If the insurance policies maintained by Landlord with respect to the Property contain a deductible, then Tenant, in the event of a loss, shall pay to Landlord Tenant s Proportionate Share thereof, based upon the amount of such deductible. Tenant s Share of such deductible amount shall be payable to Landlord within ten (10) days following receipt from Landlord of a statement therefor and payment thereof by Tenant shall be a condition precedent to Landlord s obligations to repair or restore the Leased Premises.
7) Costs of repairs and maintenance of the parking facilities and landscaping of the Buildings and Land;
8) Management fees not to exceed six percent (6%) of the gross rent generated by the Buildings ( Management Fees );
9) All net expenses properly allocable to any event operating year for any capital improvement or structural repair incurred to reduce or limit increases in Operating Cost, or by any change in the laws, rules, regulations or orders of any governmental or quasi- governmental authority having jurisdiction or expenses resulting from normal repair or maintenance, which expenses shall be repaid in equal monthly installments together with interest at applicable rates over the lesser of the useful capital life of the capital improvement or structural repair or the operational savings payback period;
10) All Taxes relating to the Buildings and Land. For purposes hereof, the term Taxes means all taxes, impositions, assessments and all other governmental charges, if any, which are levied, assessed or imposed upon or become due and payable in connection with, or a lien upon, the Buildings or Land, or the operation thereof, (excepting federal and state taxes on income) including taxes levied by present or future taxing authorities and all taxes of whatsoever nature that are imposed in substitution for, or in lieu of, any of the taxes, impositions, assessments or other charges included in this definition of Taxes and including without limitation, any tax on rents, or other tax levied against Landlord or the Leased Premises in lieu of supplementing all or any portion of the foregoing taxes. Notwithstanding the foregoing, however, if in lieu of the whole or any part of any taxes or assessments levied, assessed or imposed on real estate and the improvements thereon, there shall be levied, assessed or imposed on Landlord or the Leased Premises a capital levy or other tax directly on the rents received therefrom and/or a franchise tax, assessment, levy or charge measured by or based, in whole or in part, upon such rents, then all such taxes, assessments, levies or charges, or the part thereof so measured or based, shall be deemed to be included within 120 daysthe term Taxes for the purpose hereof. However, Taxes excludes the portion, if any, of ad valorem taxes against the Leased Premises that is paid by tenants as a separate charge pursuant to Section 5.A.2 of this Lease.
11) Any charges incurred by Xxxxxxxx as Owner of the Land under any declaration of covenants, conditions and restrictions covering the Commercial Park ( POA Charges ). Notwithstanding anything to the contrary contained herein, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share of Operating Costs, and within thirty (30) days thereafter Tenant shall pay to Landlord, or Landlord shall credit to the next rent payments due Landlord from Tenant, as the case may be, any difference between the actual Operating Costs and the estimated Operating Costs paid by Tenant. Tenant's Proportionate Share of Operating Costs for the years in which this Lease commences and terminates shall be prorated by multiplying the actual Operating Costs by a fraction the numerator of which is the number of days of that year of the Term and the denominator of which is 365. Notwithstanding any other provision herein to the contrary, it is agreed that in the event that the Project is not fully occupied at any time during the Term, an adjustment shall be made in computing the management fee component of the Operating Costs for such year so that the management fee component of the Operating Costs shall be computed for such year as though the Project had been fully occupied during such year. For a period of three (3) years following Tenant's receipt of Landlord's statement of actual Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in the offices where Landlord maintains its accounting records. No subtenant will have the right to audit under this provision. An assignee may have cause Tenant s Proportionate Share of the right POA Charges to audit as provided herein, however, such right shall only apply be collected directly from the Tenant by the POA on an annual basis; and
12) Legal and accounting expenses incurred with respect to the assignee's term pursuant Buildings and Land, but excluding legal expenses related to the Lease. In collection of rent or the event a discrepancy sale, leasing or financing of three percent the Buildings and Land.
(b) Expressly excluded from the definition of the term Operating Costs are:
1) Any and all collection costs, including legal fees and bad debt losses or reserves;
2) Replacement of capital investment items (other than those set forth in Section 5.A.1(a)(8) above);
3%) or more is found Costs actually reimbursed by insurance proceeds;
4) Rent and similar commissions, excluding Management Fees set forth in favor of Tenant5.A.1(a)(7) above, Landlord shall pay the advertising, and legal expenses related to negotiating and enforcing leases;
5) The cost of such audit. If the audit discloses an overcharge any repair made by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result because of the audit.total or partial destruction of the Leased Premises or Buildings or the condemnation of a portion of the Leased Premises or Buildings;
6) Specific costs billed to and paid by specific tenants;
Appears in 1 contract
Samples: Lease Agreement
Operating Costs. Tenant shall, for the entire Term, pay to Landlord as an item of additional rent, without any setoff or deduction therefrom, its Proportionate Share of costs ("Operating Costs") which Landlord may incur in maintaining and operating the Project during each calendar year of the Term. "Proportionate Share" is defined as the decimal equivalent of a fraction, the numerator of which is the rentable area of the Premises and the denominator of which is the rentable area within the entire Building. "Operating Costs" are defined to include all reasonable expenses means (except as provided --------------- herein) 100% of the actual expenses, costs and costs (but not specific costs which are separately billed to and disbursements of any kind other than Taxes, paid or incurred by individual tenants, including Tenant) which the Landlord shall pay or become obligated to pay because of or in connection with the ownership, leasing, management, maintenance, operation and maintenance repair of any part of the Project and supporting facilities of the Projectpersonal property, fixtures, machinery, equipment, systems and apparatus used in connection therewith, including but not limited the cost of providing those services required to all real estate taxes and annual installments of special assessments payable in such calendar year with respect to the Project; costs of any contest of such taxes, including reasonable attorney's fees; management fees (except that no management fee shall be charged during such period(s) that Tenant elects to maintain and manage the common areas pursuant to Section 10), insurance premiums, utility costs, security costs, costs of wages, maintenance costs (relating to the Project including sidewalks, landscaping and parking or service areas, common areas, service contracts, equipment and supplies) and all other costs of any nature whatsoever which for federal tax purposes may be expensed rather than capitalized, all in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, costs of leasehold improvements and payments of principal and interest on any mortgages, deeds of trusts, or other security devices covering the Projectfurnished by Landlord under this Lease. Operating Costs shall also not include (a) costs of alterations of tenant premises; (b) costs of capital improvements, except those intended to reduce Operating Costs, and those made to keep the yearly Project in compliance with governmental requirements applicable from time to time, amortized by Landlord in accordance with sound accounting and management principles; (c) interest and principal payments on mortgages or any other debt costs, or rental payments on any ground lease of the Project ("Ground Lease"); (d) real estate brokers' leasing commissions; (e) any cost or expenditure for which Landlord is reimbursed by insurance proceeds or otherwise, except by Operating Cost Share Rent; (f) the cost of any service furnished to any office tenant of the Project which Landlord does not make available to Tenant; (g) depreciation or amortization of capital any improvements, except as specifically set forth in this Lease; (h) costs incurred of repairs, alterations or replacements caused by the Landlord for improvements or structural repairs exercise of the rights of imminent domain to the Project required extent Landlord receives net condemnation proceeds therefor; (i) costs of electricity for individual tenant spaces, (j) costs of any special services rendered or costs reimbursed to comply with any change after the commencement date other tenants which are not generally reimbursed or rendered to either retail or office tenants in the lawsBuilding; (k) costs and expenses incurred in connection with leasing space in the Building, rules such as legal fees for the preparation of leases, tenant allowances, space planner fees and advertising and promotional expenses (1) court costs and legal fees incurred with regard to enforcing the obligations of tenants under other leases; (m) any expenses for services or regulations items for which Tenant directly reimburses Landlord (other than as a component of Operating Expenses) or pays to third parties at Landlord's request; (n) costs and expenses incurred as a result of a violation by Landlord of the terms and conditions of any lease in the Building or of any law, statute or ordinance, or any debt agreement or ground lease; (o) costs and expenses of relocation of any tenants in the Building; (p) costs, fines or penalties incurred due to violation by Landlord of any governmental authority having jurisdictionrule or law except as incurred by Landlord in challenging any law; (q) overhead and profit paid to subsidiaries of Landlord or entitles under common control with Landlord for services on or to the Building, or for purposes of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building components), which costs shall be amortized over but only to the useful life extent that the cost of such improvements services exceeds normal rates being paid for such services by owners of other first class office buildings in the Chicago metropolitan area; (r) wages, salaries or repairs, as reasonably estimated fringe benefits related to any employee above the rank of Building manager; (s) amounts of any political and charitable contributions paid by the Landlord; (t) compensation paid to clerks or attendants in commercial concessions operated by Landlord, but in no event in excess of the savings. The management fee shall not exceed 3% of Tenant's Base Rent and Operating Costs (determined without reference to any management fee or taxes and special assessments). if any, except that Operating Expenses shall include such compensation if landlord deducts from the computation of Operating Expenses any profits derived by Landlord from such concession; (u) rentals or other related expenses incurred by Landlord in leasing Building systems and major Building components; and (v) costs of acquiring sculptures, paintings or other objects of art for the Building. If the Project is not include fully leased during any compensation or benefits for portion of any off-site manager, any administrative or overhead expenses, any special assessments or charges in the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with or as a consequence of the development of the Project. As soon as reasonably practicable prior to the commencement of each calendar year during the Termfiscal year, Landlord shall furnish to Tenant may adjust (an estimate of "Equitable Adjustment") Operating Costs for to equal what would have been incurred by Landlord had the ensuing calendar year Project been fully leased. For example, assume (i) the Building has ten floors; (ii) the Tenant occupies one floor and Tenant's Proportionate Share thereofis ten percent (10%); (iii) the other nine floors are vacant; (iv) the cost of providing a particular service for Tenant's floor is $1,000. If Tenant shall pay, as additional rent hereunder together with each installment of Base Rent, one-twelfth (1/12th) of its estimated annual Proportionate Share of Operating Costs. As soon as reasonably practicable after the end of each calendar year during the Term and in any event within 120 days, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including paid Tenant's Proportionate Share of Operating Coststhat cost, and within thirty (30) days thereafter Tenant shall would pay to Landlord$100. Instead, or Landlord shall credit estimate the cost of such service for the Building if it were one hundred percent (100%) leased. Landlord would take into account any economies of scale; for example, the cost for the entire Building might be $9,000. The Landlord's estimate ($9,000) minus the actual cost incurred by the Landlord ($1000) equals the Equitable Adjustment ($8000). The Equitable Adjustment is added to the next rent payments due Landlord from Tenant, as the case may be, any difference between the actual Operating Costs cost and the estimated Operating Costs paid by Tenant. Tenant pays Tenant's Proportionate Share of the total; in this example, Tenant would pay $9,000 times 10% or $900. This Equitable Adjustment shall apply only to Operating Costs for the years in which this Lease commences are variable and terminates shall be prorated by multiplying the actual Operating Costs by a fraction the numerator of which is the number of days of that year therefore increase as leasing of the Term and Project increases. Landlord may incorporate the denominator Equitable Adjustment in its estimates of which is 365Operating Costs. Notwithstanding If Landlord does not furnish any other provision herein particular service whose cost would have constituted an Operating Cost to the contrarya tenant who has undertaken to perform such service itself, it is agreed that in the event that the Project is not fully occupied at any time during the Term, an adjustment shall be made in computing the management fee component of the Operating Costs for such year so that the management fee component of the Operating Costs shall be computed for increased by the amount which Landlord would have incurred if it had furnished the service to such year as though the Project had been fully occupied during such year. For a period of three (3) years following Tenant's receipt of Landlord's statement of actual Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in the offices where Landlord maintains its accounting records. No subtenant will have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result of the audittenant.
Appears in 1 contract
Samples: Lease (Focal Communications Corp)
Operating Costs. Tenant shall, for the entire Term, pay to Landlord as an item of additional rent, without i. Operating Costs shall mean any setoff or deduction therefrom, its Proportionate Share of costs ("Operating Costs") which Landlord may incur in maintaining and operating the Project during each calendar year of the Term. "Proportionate Share" is defined as the decimal equivalent of a fraction, the numerator of which is the rentable area of the Premises and the denominator of which is the rentable area within the entire Building. "Operating Costs" are defined to include all reasonable expenses and costs (but not specific costs which are separately billed to and paid incurred by individual tenants, including Tenant) which the Landlord shall pay or become obligated to pay because of or Lessor in connection with the operation of the Building and the Property, including all expenses incurred as a result of Lessor's compliance with any of its obligations hereunder other than Lessor's Work, and such expenses shall include: (1) salaries, wages, medical, surgical and general welfare benefits, (including group life insurance) pension payments and other fringe benefits of employees of Lessor engaged in the operation and maintenance of the Project Building (the salaries and supporting other benefits aforesaid of such employees servicing the Building shall be comparable to those of employees servicing similar Buildings located in the County of Monmouth); (2) payroll taxes, worker's compensation, uniforms and dry cleaning for the employees referred to in subdivision (1); (3) the cost of all charges for steam, heat, ventilation, air conditioning and water (including sewer charges) furnished to the common areas of the Building and/or used in the operation of all of the service and facilities of the ProjectBuilding and the cost of all charges for electricity furnished to the public and common areas of the Building and/or used in the operation of all of the service and facilities of the Building including any taxes on any such utilities; (4) the cost of all charges for rent, casualty, war risk insurance (if obtainable from the United States government) and of liability insurance for the Building and the Property to the extent that such insurance is required to be carried by Lessor under any superior lease or superior mortgage or if not required under any superior lease or superior mortgage then to the extent such insurance is carried by owners of buildings comparable to the Building; (5) the cost of all building supplies; (6) Repair and Maintenance Expenses, Common Area Expenses and Common Utility Expenses; (7) the cost of all charges for management, window cleaning and service contracts for the Building and the other service facilities related thereto; (8) the cost of rentals of capital equipment designed to result in savings or reductions in Operating Costs. If the Building is not at least one hundred percent (100%) occupied during any Lease Year, or proportionate part thereof, Operating Costs shall be equitably adjusted (by including but not limited such net additional Operating Costs as Lessor would have incurred) to all real estate taxes and annual installments the extent required to reflect one hundred percent (100%) occupancy of special assessments payable in such calendar year the Building. The aforesaid adjustment shall only be made with respect to the Project; costs of any contest of such taxes, including reasonable attorney's fees; management fees (except those items that no management fee shall be charged during such period(s) that Tenant elects to maintain and manage the common areas pursuant to Section 10), insurance premiums, utility costs, security costs, costs of wages, maintenance costs (relating to the Project including sidewalks, landscaping and parking or service areas, common areas, service contracts, equipment and supplies) and all other costs of any nature whatsoever which for federal tax purposes may be expensed rather than capitalized, all are in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, costs of leasehold improvements and payments of principal and interest on any mortgages, deeds of trusts, or other security devices covering the Projectfact affected by variations in occupancy levels. Operating Costs costs shall also include not include; (a) ad ministrative wages and salaries; (b) real estate brokerage commissions; franchise taxes or income taxes of Lessor; (d) Taxes on the yearly Building and Building Area; (e) cost of painting and decoration for any occupant's space; (f) interest and amortization of under mortgages; (g) rent payable under any superior lease; and (h) expenditures for capital costs incurred improvements except (x) those which under generally applied real estate practice are expensed or regarded as deferred expenses and (xx) for capital improvements required by the Landlord law or (xxx) for capital improvements or structural repairs which are designed to the Project required to comply with any change after the commencement date result in a saving in the laws, rules or regulations of any governmental authority having jurisdiction, or for purposes of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building components), which costs shall be amortized over the useful life of such improvements or repairs, as reasonably estimated by the Landlord, but in no event in excess of the savings. The management fee shall not exceed 3% of Tenant's Base Rent and Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site manager, any administrative or overhead expenses, any special assessments or charges in the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with or as a consequence of the development of the Project. As soon as reasonably practicable prior to the commencement of each calendar year during the Term, Landlord shall furnish to Tenant an estimate of Operating Costs for the ensuing calendar year and Tenant's Proportionate Share thereof. Tenant shall pay, as additional rent hereunder together with each installment of Base Rent, one-twelfth (1/12th) of its estimated annual Proportionate Share amount of Operating Costs. As soon as reasonably practicable after the end of each calendar year during the Term and in any event within 120 days, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share of Operating Costs, and within thirty (30) days thereafter Tenant shall pay to Landlord, or Landlord shall credit to the next rent payments due Landlord from Tenant, as In the case may be, any difference between the actual Operating Costs and the estimated Operating Costs paid by Tenant. Tenant's Proportionate Share of Operating Costs for the years in which this Lease commences and terminates shall be prorated by multiplying the actual Operating Costs by a fraction the numerator of which is the number of days of that year of the Term and the denominator of which is 365. Notwithstanding any other provision herein to the contrary, it is agreed that in the event that the Project is not fully occupied at any time during the Term, an adjustment shall be made in computing the management fee component of the Operating Costs for such year so that the management fee component of the Operating Costs shall be computed for such year as though the Project had been fully occupied during such year. For a period of three (3xx) years following Tenant's receipt of Landlord's statement of actual Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in the offices where Landlord maintains its accounting records. No subtenant will have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result of the audit.and
Appears in 1 contract
Operating Costs. Tenant shall, for the entire Term, pay to Landlord as an item of additional rent, without any setoff or deduction therefrom, its Proportionate Share of costs ("Operating Costs"I) which Landlord may incur in maintaining and operating the Project during each calendar year of the Term. "Proportionate Share" is defined as the decimal equivalent of a fraction, the numerator of which is the rentable area of the Premises and the denominator of which is the rentable area within the entire Building. The term "Operating Costs" are defined to include all reasonable expenses and costs (but not specific costs which are separately billed to and means the total amounts paid or payable whether by individual tenants, including Tenant) which the Landlord shall pay or become obligated to pay because others on behalf of or the Landlord in connection with the ownership, maintenance, repair and operation and maintenance of the Project and supporting facilities Building, including without limiting the generality of the Projectforegoing, the purchase of steam or other energy for heating or other purposes, the amount paid or payable for all electricity furnished by the Landlord to the Building, the amount paid or payable for replacement of electric light bulbs, tubes and ballasts; the amount paid or payable for all hot and cold water (other than that paid by Tenants), the amount paid or payable for all labor and/or wages and other payments including costs to Landlord or xxxxxxx'x compensation and disability insurance, payroll taxes, welfare and fringe benefits made to janitors, caretakers, and other employees, contractors and subcontractors of the Landlord (including but not limited to all real estate taxes salary or wages of the building manager) involved in the operation, maintenance, and annual installments repair of special assessments payable in such calendar year with respect the Building, managerial and administrative expenses related to the Project; Building, the total charges of any independent contractors employed in the repair, care, operation, maintenance, and cleaning of the Building, the amount paid or payable for all supplies including all supplies and necessities which are occasioned by everyday wear and tear, the costs of any contest of such taxesclimate control, including reasonable attorney's fees; management fees (except that no management fee shall be charged during such period(s) that Tenant elects to maintain window and manage the common areas pursuant to Section 10)exterior wall cleaning, insurance premiums, telephone and utility costs, security coststhe cost of accounting services necessary to compute the rents and charges payable by tenants of the Building, costs fees for management, legal, accounting, inspection and consulting services, the cost of wagesguards and other protection services, payments for general maintenance costs (relating and repairs to the Project including sidewalksplant and equipment supplying, landscaping and parking or service areas, common areas, service contracts, equipment and supplies) the amount paid for premiums for all insurance and all other costs of any nature whatsoever which for federal tax purposes may be expensed rather than capitalized, all amounts payable in accordance with Generally Accepted Accounting Principlesground leases, consistently applied but exclusive only easements, or right of leasing commissionsway appurtenant to the Building. Operating Costs shall not, however, include interest on debt, capital retirement of debt, depreciation, costs of leasehold improvements properly chargeable to capital account, and payments of principal and interest on any mortgages, deeds of trusts, or other security devices covering the Project. Operating Costs shall also include the yearly amortization of capital costs incurred directly charged by the Landlord for improvements to any tenant or structural repairs tenants. The reference to "Building" in this subparagraph (c)(I) shall include all related facilities including sidewalks, grounds, elevators, and other public areas -------- -------- initials initials contained around the Project required Building as well as landscaping, parking areas, and exterior walkways and areas. By setting forth the above items which may or could be included within Operating Costs, it is not meant to comply with any change after the commencement date in the laws, rules indicate or regulations of any governmental authority having jurisdiction, or for purposes of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building components), which costs shall be amortized over the useful life imply that all of such improvements activities or repairs, as reasonably estimated services will be provided by the Landlord, but in no event in excess of the savings. The management fee shall not exceed 3% of Tenant's Base Rent and Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site manager, any administrative or overhead expenses, any special assessments or charges in the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with or as a consequence of the development of the Project. As soon as reasonably practicable prior to the commencement of each calendar year during the Term, Landlord shall furnish to Tenant an estimate of Operating Costs for the ensuing calendar year and Tenant's Proportionate Share thereof. Tenant shall pay, as additional rent hereunder together with each installment of Base Rent, one-twelfth (1/12th) of its estimated annual Proportionate Share of Operating Costs. As soon as reasonably practicable after the end of each calendar year during the Term and in any event within 120 days, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share of Operating Costs, and within thirty (30) days thereafter Tenant shall pay to Landlord, or Landlord shall credit to the next rent payments due Landlord from Tenant, as the case may be, any difference between the actual Operating Costs and the estimated Operating Costs paid by Tenant. Tenant's Proportionate Share of Operating Costs for the years in which this Lease commences and terminates shall be prorated by multiplying the actual Operating Costs by a fraction the numerator of which is the number of days of that year of the Term and the denominator of which is 365. Notwithstanding any other provision herein to the contrary, it is agreed that in the event that the Project is not fully occupied at any time during the Term, an adjustment shall be made in computing the management fee component of the Operating Costs for such year so that the management fee component of the Operating Costs shall be computed for such year as though the Project had been fully occupied during such year. For a period of three (3) years following Tenant's receipt of Landlord's statement of actual Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in the offices where Landlord maintains its accounting records. No subtenant will have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result of the audit.
Appears in 1 contract
Operating Costs. Tenant shall, for the entire Lease Term, pay to Landlord as an item of additional rent, without any counterclaim, setoff or deduction therefrom, its Proportionate Share of costs ("Operating Costs") Costs which Landlord may incur incur.
(a) As used in maintaining and operating the Project during each calendar year of the Term. "this Lease, Tenant's 'Proportionate Share" is defined as the decimal equivalent of ' shall mean a fraction, the numerator of which is the gross rentable area of the Leased Premises and the denominator of which is the gross rentable area within contained in the entire Building, in each case as reasonably determined by Landlord. For purposes hereof, the numerator of said fraction is 3,860 the denominator is 81,243 and Tenant's Proportionate Share is 4.751%.
(b) As used in this Lease, the term "Operating Costs" are shall mean any and all expenses, costs and disbursements of any kind and nature whatsoever incurred by Landlord in connection with the ownership, leasing, management, maintenance, protection, operation, replacement and repair of the Building or the Property or any improvements situated on the Property (including, without limitation, the costs of maintaining and repairing parking lots, parking structures and easements, property management fees, salaries, fringe benefits and related costs, insurance costs of every kind and nature, heating and air conditioning costs, electricity and other utility costs, the costs of repairs, maintenance and decorating for the Building, landscape maintenance, snow removal, Taxes (as defined to include all reasonable expenses in Paragraph 3 hereof) and costs (but not specific costs and expenses incurred by Landlord in protesting any assessments, levies or the Taxes which are separately billed to and paid by individual tenants, including Tenant) which the Landlord shall pay or become obligated to pay because in respect of a calendar year (regardless of when such Operating Costs were incurred), the Building's pro rata share (as reasonably determined by Landlord) of the cost of operating, maintaining and repairing any areas, facilities or in connection easements which are common to the Building and any other building sharing common facilities with the operation and maintenance of the Project and supporting facilities of the ProjectBuilding owned or operated by Landlord or its successor (such as, including but not limited to all to, snow plowing, landscaping, common area and street lighting, insurance, taxes, security and management), except the following: (i) costs of alterations of tenants' premises; (ii) costs of capital improvements and costs of curing construction defects; (iii) depreciation; (iv) interest and principal payments on mortgages, and other debt costs; (v) real estate taxes brokers' leasing commissions or computation; (vi) any cost or expenditure (or portion thereof) for which Landlord is reimbursed, whether by insurance proceeds or otherwise; and annual installments of special assessments payable in such calendar year with respect to the Project; costs (vii) cost of any contest of such taxes, including reasonable attorney's fees; management fees (except that no management fee shall be charged during such period(s) that Tenant elects service furnished to maintain and manage the common areas pursuant to Section 10), insurance premiums, utility costs, security costs, costs of wages, maintenance costs (relating to the Project including sidewalks, landscaping and parking or service areas, common areas, service contracts, equipment and supplies) and all any other costs of any nature whatsoever which for federal tax purposes may be expensed rather than capitalized, all in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, costs of leasehold improvements and payments of principal and interest on any mortgages, deeds of trusts, or other security devices covering the Project. Operating Costs shall also include the yearly amortization of capital costs incurred by the Landlord for improvements or structural repairs to the Project required to comply with any change after the commencement date in the laws, rules or regulations of any governmental authority having jurisdiction, or for purposes of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building components), which costs shall be amortized over the useful life of such improvements or repairs, as reasonably estimated by the Landlord, but in no event in excess occupant of the savings. The management fee shall Building which Landlord does not exceed 3% of Tenant's Base Rent and Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site manager, any administrative or overhead expenses, any special assessments or charges in the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with or as a consequence of the development of the Project. As soon as reasonably practicable prior to the commencement of each calendar year during the Term, Landlord shall furnish provide to Tenant an estimate of Operating Costs for the ensuing calendar year and Tenant's Proportionate Share thereof. Tenant shall pay, as additional rent hereunder together with each installment of Base Rent, one-twelfth (1/12th) of its estimated annual Proportionate Share of Operating Costs. As soon as reasonably practicable after the end of each calendar year during the Term and in any event within 120 days, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share of Operating Costs, and within thirty (30) days thereafter Tenant shall pay to Landlord, or Landlord shall credit to the next rent payments due Landlord from Tenant, as the case may be, any difference between the actual Operating Costs and the estimated Operating Costs paid by Tenant. Tenant's Proportionate Share of Operating Costs for the years in which this Lease commences and terminates shall be prorated by multiplying the actual Operating Costs by a fraction the numerator of which is the number of days of that year of the Term and the denominator of which is 365hereunder. Notwithstanding any other provision anything contained herein to the contrary, depreciation of any capital improvements made after the date of this Lease which are intended to reduce Operating Costs or which are required under any governmental laws, regulations or ordinances which were not applicable to the Building at the time it is agreed that was constructed, shall be included in Operating Costs. The useful life of any such improvement shall be reasonably determined by Landlord. In addition, interest on the undepreciated cost of any such improvement (at the prevailing construction loan rate available to Landlord on the date the cost of such improvement was incurred) shall also be included in Operating Costs. In the event that during all or any portion of any calendar year the Project Building is not fully occupied at any time during the Termrented and occupied, Landlord may elect to make an appropriate adjustment shall be made in computing the management fee component of the Operating Costs for such year so that the year, employing sound accounting and management fee component of the principles to determine Operating Costs that would have been paid or incurred by Landlord had the Building been fully rented and occupied and the amount so determined shall be computed deemed to have been Operating Costs for such year as though the Project had been fully occupied during such year. For a period of three (3) years following Tenant's receipt of Landlord's statement of actual Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in the offices where Landlord maintains its accounting records. No subtenant will have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result of the audit.
Appears in 1 contract
Operating Costs. Tenant shallThe term “Operating Costs” shall mean the total of all of the costs incurred by Landlord relating to the ownership, operation, maintenance, repair, and replacement of the Building Project and the services provided tenants in the Building Project. By way of explanation and clarification, but not by way of limitation, Operating Costs will include the costs and expenses incurred for the entire Termfollowing: Real Estate Taxes; pest control; trash and garbage removal (including dumpster rental); security; Common Areas decorations; repairs, pay maintenance, and alteration of building systems, Common Areas, and other portions of the Building Project to be maintained by Landlord; amounts paid under easements or other recorded agreements affecting the Building Project, including assessments paid to property owners’ associations; repairs, maintenance, replacements, and improvements that are appropriate for the continued operation of the Building Project as a first class building; improvements required by law; improvements in security systems; materials, tools, supplies, and equipment to enable Landlord as an item of additional rent, without any setoff to supply services that Landlord would otherwise have obtained from a third party; expenditures designed to result in savings or deduction therefrom, its Proportionate Share of costs ("reductions in Operating Costs") which Landlord may incur in maintaining ; landscaping, including fertilization and operating irrigation supply; parking area maintenance and supply; property management fees; all utilities serving the Building Project during each calendar year of the Term. "Proportionate Share" is defined as the decimal equivalent of a fraction, the numerator of which is the rentable area of the Premises and the denominator of which is the rentable area within the entire Building. "Operating Costs" are defined to include all reasonable expenses and costs (but not specific costs which are separately billed to or reimbursed by any tenant of the Building Project; cleaning; window washing, and paid janitorial services; all insurance customarily carried by individual tenantsowners of comparable buildings or required by any mortgagee of the Building Project; supplies; service and maintenance contracts for the Building Project; wages, including Tenant) which salaries, and other benefits and costs of employees of the Landlord up to and including the building manager (including a pro rata share only of the wages and benefits of employees who are employed at more than one building, which pro rata share shall pay be determined by Landlord and shall be based on Landlord’s estimate of the percentage of time spent by the employees at the Building Project); legal, accounting, and administrative costs; and uniforms and working clothes for employees and the cleaning of them. Landlord may contract for the performance of some or become obligated to pay because all of or in connection with the operation management and maintenance functions generally described in this section with entities that are affiliated with Landlord. If the roof of the Project and supporting facilities of Building is replaced by Landlord during the ProjectLease Term, including but not limited to all real estate taxes and annual installments of special assessments payable in such calendar year with respect to then the Project; costs of any contest of such taxes, including reasonable attorney's fees; management fees (except that no management fee shall replacement to be charged during such period(s) that Tenant elects to maintain and manage the common areas pursuant to Section 10), insurance premiums, utility costs, security costs, costs of wages, maintenance costs (relating to the Project including sidewalks, landscaping and parking or service areas, common areas, service contracts, equipment and supplies) and all other costs of any nature whatsoever which for federal tax purposes may be expensed rather than capitalized, all included in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, costs of leasehold improvements and payments of principal and interest on any mortgages, deeds of trusts, or other security devices covering the Project. Operating Costs shall also include the yearly amortization of capital costs incurred by the Landlord for improvements or structural repairs to the Project required to comply with any change after the commencement date in the laws, rules or regulations of any governmental authority having jurisdiction, or for purposes of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building components), which costs shall be amortized on a straight line basis over the useful life of such improvements or repairs, as reasonably estimated by expenditure with an interest factor equal to the Wall Street Journal Prime Rate in effect at the time of Landlord's having incurred the expenditure, but in no event in excess greater than the maximum rate of the savings. The management fee shall not exceed 3% of Tenant's Base Rent and Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site manager, any administrative or overhead expenses, any special assessments or charges in the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with or as a consequence of the development of the Project. As soon as reasonably practicable prior to the commencement of each calendar year during the Term, Landlord shall furnish to Tenant an estimate of Operating Costs for the ensuing calendar year and Tenant's Proportionate Share thereof. Tenant shall pay, as additional rent hereunder together with each installment of Base Rent, one-twelfth (1/12th) of its estimated annual Proportionate Share of Operating Costs. As soon as reasonably practicable after the end of each calendar year during the Term and in any event within 120 days, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share of Operating Costs, and within thirty (30) days thereafter Tenant shall pay to Landlord, or Landlord shall credit to the next rent payments due Landlord from Tenant, as the case may be, any difference between the actual Operating Costs and the estimated Operating Costs paid interest allowed by Tenant. Tenant's Proportionate Share of Operating Costs for the years in which this Lease commences and terminates shall be prorated by multiplying the actual Operating Costs by a fraction the numerator of which is the number of days of that year of the Term and the denominator of which is 365law. Notwithstanding any other provision herein to the contraryprovisions of this Section stated above, it is agreed that in the event that the Project is not fully occupied at any time during the Term, an adjustment shall be made in computing the management fee component of the Operating Costs for such year so that the management fee component of the Operating Costs shall be computed for such year as though the Project had been fully occupied during such year. For a period of three (3) years following Tenant's receipt of Landlord's statement of actual Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in the offices where Landlord maintains its accounting records. No subtenant will have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result of the audit.not include:
Appears in 1 contract
Samples: Lease (Health Benefits Direct Corp)
Operating Costs. Tenant shall, for the entire Term, pay to Landlord as an item of additional rent, without any setoff or deduction therefrom, its Proportionate Share of costs ("Operating Costs") which Landlord may incur in owning, maintaining and operating the Project during each calendar year of the Term. "Proportionate Share" is defined as the % of Operating Costs incurred by Landlord with respect to the Project (the decimal equivalent of a fraction, the numerator of which is the rentable area of the Premises and the denominator of which is the rentable area within the entire BuildingProject). "Operating Costs" are defined to include all reasonable expenses and costs (but not specific costs which are separately billed to and paid by individual tenants, including Tenant) of every kind and nature which the Landlord shall pay or become obligated to pay because of or in connection with the ownership and operation and maintenance of the Project and supporting facilities of the Project, including but not limited to all real estate taxes and annual installments of special or other assessments payable in such calendar year with respect to the Project; costs of any contest of such taxes, including reasonable attorney's fees; management fees fees, (except that no management fee shall be charged during such period(snot to exceed 4% of gross receipts) that Tenant elects to maintain and manage the common areas pursuant to Section 10), insurance premiums, utility costs, security costs, costs of wages, maintenance costs (relating to the Project including sidewalks, landscaping and parking or service areas, common areas, service contracts, equipment and supplies) and all other costs of any nature whatsoever which for federal tax purposes may be expensed rather than capitalized, all in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, costs of leasehold tenant improvements and payments of principal and interest on any mortgages, deeds of trusts, or other security devices covering the Project. Operating Costs shall also include the yearly amortization of capital costs incurred by the Landlord for improvements or structural repairs to the Project required to comply with any change after the commencement date in the laws, rules or regulations of any governmental authority having jurisdiction, or for purposes of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building components)Costs, which costs shall be amortized over the useful life of such improvements or repairs, as reasonably estimated by the Landlord, but in no event in excess of the savings. The management fee shall not exceed 3% of Tenant's Base Rent and Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site manager, any administrative or overhead expenses, any special assessments or charges in the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with or as a consequence of the development of the Project. As soon as reasonably practicable prior to the commencement of each calendar year during the Term, Landlord shall furnish to Tenant an estimate of Operating Costs for the ensuing calendar year and Tenant's Proportionate Share thereof. Tenant shall pay, as additional rent hereunder together with each installment of Base Rent, one-twelfth (1/12th) of its estimated annual Proportionate Share of Operating Costs. As soon as reasonably practicable after the end of each calendar year during the Term and in any event within 120 daysTerm, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share of Operating Costs, and within thirty (30) days thereafter Tenant shall pay to Landlord, or Landlord shall credit to the next rent payments due Landlord from Tenant, as the case may be, any difference between the actual Operating Costs and the estimated Operating Costs paid by Tenant. Tenant's Proportionate Share of Operating Costs for the years in which this Lease commences and terminates shall be prorated by multiplying the actual Operating Costs by a fraction the numerator of which is the number of days of that year of the Term and the denominator of which is 365. Notwithstanding any other provision herein to the contrary, it is agreed that in the event that the Project is not fully occupied at any time during the Term, an adjustment shall be made in computing the management fee component of the Operating Costs for such year so that the management fee component of the Operating Costs shall be computed for such year as though the Project had been fully occupied during such year. For a period of three (3) years one year following Tenant's receipt of Landlord's statement of actual Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books and records copies of all supporting statements relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in the offices where Landlord maintains its accounting records. Within ten (10) business days after the date of the audit, Tenant will provide Landlord a copy of the audit. Tenant shall not have the right to audit while in monetary default. No subtenant will have the right to audit under this provision. An assignee AN assignee, approved by Landlord, may have the right to audit as provided herein, however, such right shall only apply to the assignee's term of occupancy in the Premises pursuant to the Lease. In the event a discrepancy of three five percent (35%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result of the audit.
Appears in 1 contract
Operating Costs. (a) It is expressly agreed that Tenant shallwill pay in addition to Fixed Basic Rent provided in Paragraph 3 above, Additional Rent for the entire Term, pay to Landlord as an item all of additional rent, without any setoff or deduction therefrom, its Proportionate Share of costs ("Operating Costs") which Landlord may incur in maintaining and operating the Project during each calendar year of the Term. "Proportionate Share" is defined as the decimal equivalent of a fraction, the numerator of which is the rentable area of the Premises and the denominator of which is the rentable area within the entire Building. "Operating Costs" are defined to include all reasonable expenses and costs (but not specific costs which are separately billed to and paid by individual tenants, including Tenant) which the Landlord shall pay or become obligated to pay because of or in connection with the operation and maintenance of the Project and supporting facilities of the Project, including but not limited to all real estate taxes and annual installments of special assessments payable in such calendar year with respect to the Project; Landlord's costs of any contest of such taxes, including reasonable attorney's fees; management fees (except operating and maintaining the Building so that no management fee the Fixed Basic Rent shall be charged during such period(s) that Tenant elects absolutely net to maintain and manage the common areas pursuant to Section 10), insurance premiums, utility costs, security costs, costs of wages, maintenance costs (relating to the Project including sidewalks, landscaping and parking or service areas, common areas, service contracts, equipment and supplies) and all other costs of any nature whatsoever which for federal tax purposes may be expensed rather than capitalized, all in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, costs of leasehold improvements and payments of principal and interest on any mortgages, deeds of trusts, or other security devices covering the Project. Operating Costs shall also include the yearly amortization of capital costs incurred by the Landlord for improvements or structural repairs to the Project required to comply with any change after the commencement date in the laws, rules or regulations of any governmental authority having jurisdiction, or for purposes of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building components), which costs shall be amortized over the useful life of such improvements or repairs, as reasonably estimated by the Landlord, but except as otherwise specifically set forth in no event in excess of the savingsthis Lease. The management fee shall not exceed 3% of Tenant's Base Rent and Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site manager, any administrative or overhead expenses, any special assessments or charges in the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with or as a consequence of the development of the Project. As soon as reasonably practicable prior to the commencement of each calendar year during the Term, Landlord shall furnish to Tenant an estimate of Operating Costs for the ensuing calendar year and Tenant's Proportionate Share thereof. Tenant shall pay, as additional rent hereunder together with each installment of Base Rent, one-twelfth (1/12th) of its estimated annual Proportionate Share of Operating Costs. As soon as reasonably practicable after the end of each calendar year during the Term and in any event within 120 days, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share of Operating Costs, and within thirty (30) days thereafter Tenant shall pay to Landlord, as Additional Rent, Tenant's Percentage, as defined in the Preamble of all operating and maintenance costs incurred by Landlord for the Building and Office Building area for any Calendar Year (or proportionate part thereof if the Lease was not in effect during the entire Calendar Year ("Operating Costs Payment") Operating costs shall include, by way of illustration and not of limitation: personal property taxes; management fees at an initial rate of $40,000.00 with reasonable yearly increases thereafter of five (5%) percent; labor, including all wages and salaries; fringe benefits; social security taxes, and other taxes which may be levied against Landlord upon such wages and salaries; supplies; repairs and cleaning services, maintenance for structural and non-structural repairs whether ordinary or extraordinary; maintenance and service contracts; the cost of all HVAC, electric, water, sewer, gas and other utilities for the Building, common facilities and common areas not otherwise billed to Tenant, but not including utility and energy costs for which any other tenant is to pay separately pursuant to a check meter or other measuring device; painting; wall and window washing; laundry and towel service; tools and equipment; fire and other insurance, trash removal, repair, maintenance and replacement of roofs, parking area, curbs and walkways; snow removal; public amenities; and all other items properly constituting direct operating costs according to standard accounting practices, provided that the contract price charged to Landlord for all of the above shall credit be at commercially reasonable prices usually charged for similar buildings in similar locations (hereinafter collectively referred to as the "Operating Costs"), but not including, brokerage commissions, leasing commissions, finder's fees, space planner fees and other similar type fees, salaries and fringe benefits for Landlord's executives above the rank of building manager; costs of repairs or replacements incurred by reason of fire or other casualty or condemnation; costs for constructing a tenant installation for any individual tenant at the Building, or amounts contributed to any such tenant in lieu thereof, or any other tenant allowances granted as an inducement to enter into a lease; amounts received by Landlord through proceeds of insurance or by any manufacturer's warranty to the next rent payments due Landlord from Tenant, as extent the case may be, any difference between the actual proceeds are compensation for expenses which were previously included in Operating Costs hereunder; advertising and promotional expenditures; costs incurred or any specific compensation Landlord receives in performing work or funishing services for any new or existing tenant in the estimated Building;rent and other charges payable in connection with any ground or underlying lease; amounts paid to affiliates of Landlord in excess of the amounts that would have been paid absent such relationship; costs of any special services rendered to a tenant of the Building which is not rendered generally to tenants therein; interest or penalties for late payments by Landlord; refinancing costs; legal, appraisal and auditing fees and court costs in connection with leasing space in the Building or in connection with proceedings or applications to reduce real estate tax assessments; all expenses for which Landlord has received reimbursement and any fines or penalties imposed by legal authorities having jurisdiction thereof by reason of such existing violations; rent payable with respect to any leasing office; management fees in excess of those referred to herein; costs incurred in operating the parking facilities for the Building except to the extent the cost of operating the parking facilities exceeds the revenues generated from operating the parking facilities; and costs incurred to test, survey, cleanup, contain, xxxxx, remove, or otherwise remedy hazardous waste or asbestos-containing materials from the Property unless the waste or asbestos-containing materials were in or on the Property because of Tenant's negligence or willful acts or omissions; depreciation of Building; interest, points and fees on debt or amortization on any mortgage or mortgages encumbering the Building and/or the land on which the Building is situated; income or excess profits taxes; costs of maintaining Landlord's corporate existence; franchise taxes; and expenditures required to be capitalized for federal income tax purposes, inclusive of renovations to and replacement of the Building and equipment, (which expenditures shall be amortized over their useful life in accordance with generally accepted accounting principles, consistently applied, and such amortization shall be included as an Operating Cost expense), unless said expenditures are for the purpose of reducing Operating Costs paid by Tenant. within the Building and Building Area or are required under any governmental law, ordinance or regulation, in which event the costs thereof shall be included.
(b) Commencing as of the Commencement Date, Tenant shall pay its Tenant's Proportionate Share Percentage of the Operating Costs. Tenant shall make estimated payments on account of Tenant's Percentage of these Operating Costs in monthly installments in advance on the first (1st) day of each month, equal to One-Twelfty (1/12th) of Tenant's Percentage of the Landlord's expenditures for Operating Costs for the years Calendar Year or part thereof immediately preceding the year in which this Lease commences and terminates to be made. Monthly payments in the first full or partial Calendar Year commencing with the Commencement Date shall be prorated by multiplying the actual Operating Costs by a fraction the numerator of which is the number of days of that year of the Term and the denominator of which is 365. Notwithstanding any other provision herein to the contrary, it is agreed that in the event that the Project is not fully occupied at any time during the Term, an adjustment shall be made in computing the management fee component of the Operating Costs for such year so that the management fee component of the Operating Costs shall be computed for such year as though the Project had been fully occupied during such year. For a period of three TEN THOUSAND AND 00/100 (3) years following Tenant's receipt of Landlord's statement of actual Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in the offices where Landlord maintains its accounting records. No subtenant will have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result of the audit.$10,000.00)
Appears in 1 contract
Samples: Lease Agreement (Infocrossing Inc)
Operating Costs. Tenant shallshall pay during the Term hereof Tenant's Percentage, for the entire Termas indicated above in Section 1.1, pay to of all Operating Costs (as hereinafter defined) incurred by Landlord as an item of additional rent, without in any setoff or deduction therefrom, its Proportionate Share of costs (calendar year. The term "Operating Costs") which Landlord may incur in maintaining and operating the Project during each calendar year of the Term. "Proportionate ShareCosts for Pxxxxx Commerce Center" is defined as the decimal equivalent of a fraction, the numerator of which is the rentable area of the Premises and the denominator of which is the rentable area within the entire Building. or "Operating Costs" are defined shall mean all costs or expenses incurred by Landlord in owning, operating, cleaning, managing, administering, maintaining, repairing, replacing, and improving the Pxxxxx Commerce Center, including, without limitation, all costs of maintenance and repair (including snow removal, landscaping and grounds maintenance, parking lot operation and maintenance) and of all repairs and replacements (other than repairs or replacements for which Landlord has received reimbursement from contractors, other tenants of the Building or from others) necessary to include keep the Pxxxxx Commerce Center in good working order, repair, appearance and condition; all reasonable expenses and costs (but not specific costs which are separately billed to and paid by individual tenantscosts, including Tenantmaterial and equipment costs; all costs related to provision of heat (including oil, electric, steam and/or gas) which and water (including sewer charges) and other utilities to the Building; payments under all service contracts relating to the foregoing; all compensation, fringe benefits, payroll taxes and workmen's compensation insurance premiums related thereto with respect to any employees of Landlord shall pay or become obligated to pay because its affiliates engaged in maintenance or management of or the Pxxxxx Commerce Center; attorneys' fees and disbursements and auditing and other professional fees and expenses; all expenses including fees of attorneys, appraisers and other consultants, incurred in connection with the operation and any efforts to obtain abatements or reductions or to assure maintenance or to resist increase of the Project and supporting facilities of the Project, including but not limited to all real estate Landlord's taxes and annual installments of special assessments payable in such calendar year with respect to the Project; costs of any contest of such taxes, including reasonable attorney's fees; management fees (except that no management fee shall be charged during such period(s) that Tenant elects to maintain and manage the common areas pursuant to Section 10), insurance premiums, utility costs, security costs, costs of wages, maintenance costs (relating to the Project including sidewalks, landscaping and parking or service areas, common areas, service contracts, equipment and supplies) and all other costs of any nature whatsoever which for federal tax purposes may be expensed rather than capitalized, all in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, costs of leasehold improvements and payments of principal and interest on any mortgages, deeds of trusts, or other security devices covering the Project. Operating Costs shall also include the yearly amortization of capital costs incurred by the Landlord for improvements or structural repairs to the Project required to comply with any change after the commencement date in the laws, rules or regulations of any governmental authority having jurisdiction, or for purposes of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building components), which costs shall be amortized over the useful life of such improvements or repairs, as reasonably estimated by the Landlord, but in no event in excess of the savings. The management fee shall not exceed 3% of Tenant's Base Rent and Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site manager, any administrative tax fiscal year wholly or overhead expenses, any special assessments or charges partially included in the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with or as a consequence of the development of the Project. As soon as reasonably practicable prior to the commencement of each calendar year during the Term, Landlord shall furnish to Tenant an estimate whether or not successful and whether or not such efforts involve filing of Operating Costs for the ensuing calendar year actual abatement applications or initiation of formal proceedings; and Tenant's Proportionate Share thereof. Tenant shall pay, as additional rent hereunder together with each installment of Base Rent, one-twelfth (1/12th) of its estimated annual Proportionate Share of Operating Costs. As soon as reasonably practicable after the end of each calendar year during the Term and in any event within 120 days, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share of Operating Costs, and within thirty (30) days thereafter Tenant shall pay to Landlord, or Landlord shall credit to the next rent payments due Landlord from Tenant, as the case may be, any difference between the actual Operating Costs and the estimated Operating Costs paid by Tenant. Tenant's Proportionate Share of Operating Costs for the years in which this Lease commences and terminates shall be prorated by multiplying the actual Operating Costs by a fraction the numerator of which is the number of days of that year of the Term and the denominator of which is 365. Notwithstanding any other provision herein to the contrary, it is agreed that in the event that the Project is not fully occupied at any time during the Term, an adjustment shall be made in computing the management fee component not to exceed 4% of gross receipts from the Operating Costs for such year so that the management fee component of the Operating Costs shall be computed for such year as though the Project had been fully occupied during such year. For a period of three (3) years following Tenant's receipt of Landlord's statement of actual Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in the offices where Landlord maintains its accounting records. No subtenant will have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result of the auditBuilding.
Appears in 1 contract
Samples: Lease (908 Devices Inc.)
Operating Costs. Tenant shallshall pay directly, for the entire Term, pay or to Landlord as an item applicable, all Operating Costs (defined below) of additional rentthe Property in a timely manner and prior to delinquency. In the event Tenant fails to pay any Operating Cost within ten (10) days after written notice by Landlord to Tenant, and without being under any setoff or deduction therefromobligation to do so and without waiving any default by Tenant, its Proportionate Share of costs ("Landlord may pay any delinquent Operating Costs") which Landlord may incur in maintaining and operating the Project during each calendar year of the Term. "Proportionate Share" is defined as the decimal equivalent of a fraction, the numerator of which is the rentable area of the Premises and the denominator of which is the rentable area within the entire Building. "Any Operating Costs" are defined to include all reasonable expenses and costs (but not specific costs which are separately billed to and Cost paid by individual tenants, including Tenant) which the Xxxxxxxx and any expenses reasonably incurred by Landlord shall pay or become obligated to pay because of or in connection with the payment of the delinquent Operating Cost, together with interest thereon at the Overdue Rate from the date paid by Landlord until the date repaid by Xxxxxx, may be billed immediately to Tenant, or at Landlord’s option and upon written notice to Tenant, may be deducted from the Security Deposit. “Operating Costs” means all costs and expenses relating to the ownership, maintenance and operation of the Property including, but not limited to: insurance, maintenance, repair and replacement of the foundation, roof, walls, heating, ventilation, air conditioning, plumbing, electrical, mechanical, utility and safety systems, paving and parking areas, roads and driveways; maintenance, repair and replacement of exterior areas such as gardening and landscaping, snow removal and signage; maintenance, repair and replacement of roof membrane, flashings, gutters, downspouts, roof drains, skylights and waterproofing; painting; lighting; cleaning; refuse removal; security; utilities for, or the maintenance of, outside areas; building personnel costs; asset, property or administrative management fees incurred or attributable to the management of the Property; the costs, expenses, charges and assessments related to or arising from any covenants, conditions and restrictions affecting the Premises, or other matters of record; rentals or lease payments paid by Landlord for rented or leased personal property used in the operation or maintenance of the Project Premises; and supporting facilities of the Project, including but not limited to all real estate taxes fees for required licenses and annual installments of special assessments payable in such calendar year with respect to the Project; costs of any contest of such taxes, including reasonable attorney's fees; management fees (except that no management fee shall be charged during such period(s) that Tenant elects to maintain and manage the common areas pursuant to Section 10), insurance premiums, utility costs, security costs, costs of wages, maintenance costs (relating to the Project including sidewalks, landscaping and parking or service areas, common areas, service contracts, equipment and supplies) and all other costs of any nature whatsoever which for federal tax purposes may be expensed rather than capitalized, all in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, costs of leasehold improvements and payments of principal and interest on any mortgages, deeds of trusts, or other security devices covering the Project. Operating Costs shall also include the yearly amortization of capital costs incurred by the Landlord for improvements or structural repairs to the Project required to comply with any change after the commencement date in the laws, rules or regulations of any governmental authority having jurisdiction, or for purposes of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building components), which costs shall be amortized over the useful life of such improvements or repairs, as reasonably estimated by the Landlord, but in no event in excess of the savings. The management fee shall not exceed 3% of Tenant's Base Rent and Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site manager, any administrative or overhead expenses, any special assessments or charges in the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with or as a consequence of the development of the Project. As soon as reasonably practicable prior to the commencement of each calendar year during the Term, Landlord shall furnish to Tenant an estimate of Operating Costs for the ensuing calendar year and Tenant's Proportionate Share thereof. Tenant shall pay, as additional rent hereunder together with each installment of Base Rent, one-twelfth (1/12th) of its estimated annual Proportionate Share of Operating Costs. As soon as reasonably practicable after the end of each calendar year during the Term and in any event within 120 days, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share of Operating Costs, and within thirty (30) days thereafter Tenant shall pay to Landlord, or Landlord shall credit to the next rent payments due Landlord from Tenant, as the case may be, any difference between the actual Operating Costs and the estimated Operating Costs paid by Tenant. Tenant's Proportionate Share of Operating Costs for the years in which this Lease commences and terminates shall be prorated by multiplying the actual Operating Costs by a fraction the numerator of which is the number of days of that year of the Term and the denominator of which is 365. Notwithstanding any other provision herein to the contrary, it is agreed that in the event that the Project is not fully occupied at any time during the Term, an adjustment shall be made in computing the management fee component of the Operating Costs for such year so that the management fee component of the Operating Costs shall be computed for such year as though the Project had been fully occupied during such year. For a period of three (3) years following Tenant's receipt of Landlord's statement of actual Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in the offices where Landlord maintains its accounting records. No subtenant will have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result of the auditpermits.
Appears in 1 contract
Samples: Absolute Net Lease Agreement (Zoned Properties, Inc.)
Operating Costs. Tenant shall, for the entire Lease Term, pay to Landlord as an item of additional rent, without any setoff set-off or deduction therefrom, its Proportionate Share Tenant's share of all costs ("Operating Costs") which Landlord may incur in owning, maintaining and operating the Project during for each calendar year of during the Lease Term. "Proportionate Share" is defined Said costs are referred to herein as the decimal equivalent of a fraction, the numerator of which is the rentable area of the Premises and the denominator of which is the rentable area within the entire Building. "Operating Costs" and are hereby defined to include all reasonable expenses and costs (include, but shall not specific costs which are separately billed to and paid by individual tenantsbe limited to, including Tenant) which the Landlord shall pay or become obligated to pay because of or in connection with the operation and maintenance of the Project and supporting facilities of the Project, including but not limited to all real estate taxes and annual installments of special assessments payable in such calendar year with respect to the Project; , maintenance, repair, replacement and care of all heating, lighting, plumbing and air conditioning fixtures, equipment and systems serving the common areas, parking and landscape areas, signs, snow removal, non-structural repair and maintenance of the exterior of the Building (including the costs of any contest of equipment purchased and used for such taxespurposes), including reasonable attorney's management fees; management fees (except that no management fee shall be charged during such period(s) that Tenant elects to maintain and manage the common areas pursuant to Section 10), insurance premiums, utility costs, security costs, costs of wages, maintenance costs (relating to the Project including sidewalks, landscaping and parking or service areas, common areas, service contractsservices, equipment and supplies) , and all other costs of any nature whatsoever which for federal tax purposes may be expensed rather than capitalized, all in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, costs of leasehold improvements tenant improvements, and payments of principal and interest on any mortgages, deeds of trusts, or other security devices mortgages covering the Project. Operating Costs shall also include any expenses or the yearly amortization of capital costs incurred by the Landlord for improvements or structural repairs to the Project required to comply with any change after the commencement date in the laws, rules or regulations of any governmental authority having jurisdiction, or for purposes purpose of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building components)Costs, which costs shall be amortized over the useful life of such improvements or repairs, as reasonably estimated by Landlord. Tenant's proportionate share of operating expenses shall be that fraction, the Landlord, but in no event in excess numerator of which is the savings. The management fee shall not exceed 3% area of Tenant's Base Rent Demised Premises and Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site manager, any administrative or overhead expenses, any special assessments or charges in the nature denominator of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with or as a consequence is the total area of the development of the ProjectBuilding. As soon as reasonably practicable prior to the commencement of each calendar year during the Lease Term, Landlord shall furnish to Tenant an estimate of Tenant's share of Operating Costs for the ensuing calendar year year, and Tenant's Proportionate Share thereof. Tenant shall pay, as additional rent hereunder together with each installment of Base Rentmonthly base rent, one-twelfth (1/12th) of its estimated annual Proportionate Share share of such Operating Costs. As soon as reasonably practicable after the end of each calendar year during the Term and in any event within 120 daysLease Term, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share share of Operating Costssuch amount, and within thirty (30) days thereafter thereafter, Tenant shall pay to Landlord, or Landlord shall credit to the next rent payments due Landlord from Tenant, Tenant as the case may be, any the difference between the such actual Operating Costs and the estimated excess Operating Costs paid by Tenant. Tenant's Proportionate Share share of such excess Operating Costs for the years in which this Lease commences and terminates terminates, and shall be prorated by multiplying based upon the actual Operating Costs by a fraction the numerator dates of which is the number of days of that year commencement and termination of the Term and the denominator of which is 365. Notwithstanding any other provision herein to the contrary, it is agreed that in the event that the Project is not fully occupied at any time during the Lease Term, an adjustment shall be made in computing the management fee component of the Operating Costs for such year so that the management fee component of the Operating Costs shall be computed for such year as though the Project had been fully occupied during such year. For a period of three (3) years following Tenant's receipt of Landlord's statement of actual Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in the offices where Landlord maintains its accounting records. No subtenant will have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result of the audit.
Appears in 1 contract
Operating Costs. Tenant shall, for the entire Term, pay to Landlord as an item of additional rent, without any setoff or deduction therefrom, its Proportionate Share of costs ("“Operating Costs") which Landlord may incur in ” includes all costs of operating, managing, repairing and maintaining the Common Facilities, including without limitation: gardening and operating landscaping; the Project during each calendar year cost of public liability, property damage and other insurance applicable to the Common Facilities, including any reasonable deductibles thereunder; Real Property Taxes applicable to the Common Facilities; utilities; line painting and parking lot repairs; roof repairs; lighting; trash and refuse removal; supplies; equipment; exterior painting; capital improvements (including without limitation the costs of roof, parking lot and underground utilities replacements); the costs of altering, improving, renovating, upgrading or retrofitting any portion of the TermCommon Facilities to comply with all laws, regulations and governmental requirements applicable to the Building (including without limitation those related to disabled persons, hazardous materials, lighting upgrades, sprinkler and energy-saving retrofits); security service; property management costs and administrative fees; bookkeeping services; labor; the cost of personnel to implement such services and to direct parking; and the includable amount of Capital Costs (as provided in Section 6.4). "Proportionate Share" is defined as Notwithstanding anything to the decimal equivalent of a fractioncontrary contained in this Lease, the numerator of which is the rentable area of the Premises and the denominator of which is the rentable area following shall not be included within the entire Building. "Operating Costs" are defined to include all reasonable : Leasing commissions, attorneys’ fees, costs, disbursements, and other expenses and costs (but not specific costs which are separately billed to and paid by individual incurred in connection with negotiations or disputes with other tenants, including Tenant) which the Landlord shall pay or become obligated to pay because of or in connection with the operation and maintenance leasing, renovating, or improving space for tenants or other occupants or prospective tenants or other occupants of the Project and supporting facilities of the Project, including but not limited to all real estate taxes and annual installments of special assessments payable in such calendar year with respect to the ProjectBuilding; costs The cost of any contest service sold to any tenant (including Tenant) or other occupant for which Landlord is entitled to be reimbursed separately as an additional charge or rental over and above the basic rent and escalations payable under the lease with that tenant; Any depreciation on the Building or Property; Costs incurred due to Landlord’s violation of such taxes, including reasonable attorney's fees; management fees (except that no management fee shall be charged during such period(s) that Tenant elects to maintain and manage the common areas pursuant to Section 10), insurance premiums, utility costs, security costs, costs any terms or conditions of wages, maintenance costs (this Lease or any other lease relating to the Project including sidewalksBuilding or Property; Overhead profit increments paid to Landlord’s subsidiaries or affiliates for management or other services on or to the building or for supplies or other materials to the extent that the cost of the services, landscaping supplies, or materials exceeds the cost that would have been paid had the services, supplies, or materials been provided by unaffiliated parties on a competitive basis; All interest, loan fees, and parking other carrying costs related to any mortgage or service areasdeed of trust or related to any capital item, common areas, service contracts, equipment and supplies) and all rental and other costs payable due under any ground or underlying lease, or any lease for any equipment ordinarily considered to be of any a capital nature whatsoever (except as provided in Section 6.4 and except janitorial and other equipment which for federal tax purposes may be expensed rather than capitalizedis not affixed to the Building); Any compensation paid to clerks, all in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, costs of leasehold improvements and payments of principal and interest on any mortgages, deeds of trustsattendants, or other security devices covering the Project. Operating persons in commercial concessions operated by Landlord; Advertising and promotional expenditures; Costs shall also include the yearly amortization of capital costs incurred repairs and other work occasioned by the Landlord for improvements fire, windstorm, or structural repairs other casualty to the Project required extent reimbursed by insurance; Any costs, fines, or penalties incurred due to comply with any change after the commencement date in the laws, rules or regulations violations by Landlord of any governmental authority having jurisdictionrule or authority; Costs for sculpture, paintings, or for purposes other objects of reducing Operating art (nor insurance thereon or extraordinary security in connection therewith); Wages, salaries, or other compensation paid to any executive employees above the grade of building manager; or Costs (other than by replacement of worn out and obsolete equipment or building components), which costs shall be amortized over the useful life of such improvements or repairs, as reasonably estimated by the Landlord, but in no event in excess Hazardous Materials Remediation of the savings. The management fee shall Common Areas not exceed 3% arising out of Tenant's Base Rent and Operating Costs (determined without reference to any management fee act or taxes and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site manager, any administrative or overhead expenses, any special assessments or charges in the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with or as a consequence of the development of the Project. As soon as reasonably practicable prior to the commencement of each calendar year during the Term, Landlord shall furnish to Tenant an estimate of Operating Costs for the ensuing calendar year and Tenant's Proportionate Share thereof. Tenant shall pay, as additional rent hereunder together with each installment of Base Rent, one-twelfth (1/12th) of its estimated annual Proportionate Share of Operating Costs. As soon as reasonably practicable after the end of each calendar year during the Term and in any event within 120 days, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share of Operating Costs, and within thirty (30) days thereafter Tenant shall pay to Landlord, or Landlord shall credit to the next rent payments due Landlord from Tenant, as the case may be, any difference between the actual Operating Costs and the estimated Operating Costs paid by Tenant. Tenant's Proportionate Share of Operating Costs for the years in which this Lease commences and terminates shall be prorated by multiplying the actual Operating Costs by a fraction the numerator of which is the number of days of that year of the Term and the denominator of which is 365. Notwithstanding any other provision herein to the contrary, it is agreed that in the event that the Project is not fully occupied at any time during the Term, an adjustment shall be made in computing the management fee component of the Operating Costs for such year so that the management fee component of the Operating Costs shall be computed for such year as though the Project had been fully occupied during such year. For a period of three (3) years following Tenant's receipt of Landlord's statement of actual Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in the offices where Landlord maintains its accounting records. No subtenant will have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy of three percent (3%) or more is found in favor omission of Tenant, Landlord shall pay the cost or any assignee or subtenant of such audit. If the audit discloses an overcharge by LandlordTenant, Landlord shall reimburse Tenant for such overcharge within twenty (20) daysor their respective agents, unless Landlord disputes the result of the auditcontractors, employees, licensees, or invitees.
Appears in 1 contract
Samples: Standard Industrial Net Lease (Halozyme Therapeutics Inc)
Operating Costs. A. For each calendar year falling partly or wholly within the Term or any extension thereof, Tenant shall, for the entire Term, shall pay to Landlord as an item of additional rent, without any setoff or deduction therefrom, its rent Tenant’s Proportionate Share of costs ("the Operating Costs incurred by Landlord for such calendar year less any monthly payments paid by Tenant as provided below for such year. Any payment to be made pursuant to this Article V with respect to the year in which this lease commences or terminates shall be prorated.
B. As used in this Lease, the term “Operating Costs"” shall mean any and all expenses, costs and disbursements (other than Taxes) which of any kind and nature whatsoever incurred by Landlord may incur in maintaining and operating the Project during each calendar year of the Term. "Proportionate Share" is defined as the decimal equivalent of a fraction, the numerator of which is the rentable area of the Premises and the denominator of which is the rentable area within the entire Building. "Operating Costs" are defined to include all reasonable expenses and costs (but not specific costs which are separately billed to and paid by individual tenants, including Tenant) which the Landlord shall pay or become obligated to pay because of or in connection with the ownership, leasing, management, maintenance, operation and maintenance repair of the Project Building or the Property or any improvements situated on the Property (including, without limitation, the cost of maintaining and supporting facilities of the Projectrepairing parking lots, including but not limited to all real estate taxes parking structures, and annual installments of special assessments payable in such calendar year with respect to the Project; easements, salaries, fringe benefits and related costs, for building staff, insurance costs of any contest of such taxesevery kind and nature, including reasonable attorney's fees; management fees (except that no management fee shall be charged during such period(s) that Tenant elects to maintain heating and manage the common areas pursuant to Section 10), insurance premiums, utility air conditioning costs, security costscommon area utility costs such as electricity, costs sewer and water charges, the cost of wages, maintenance costs (relating to the Project including sidewalks, landscaping cleaning and parking or service areas, removing snow from common areas, service contractsthe cost of routine repairs, equipment maintenance and supplies) decorating of common areas and all other the Building’s or Property’s share of costs of any nature whatsoever which for federal tax purposes may be expensed rather than capitalizedthe Development), all in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, except the following: (1) costs of leasehold improvements alterations of tenants’ premises; (2) depreciation; (3) interest and principal payments of principal and interest on any mortgages, deeds and other debt costs; (4) real estate brokers’ leasing commissions or compensation; (5) any cost or expenditure (or portion thereof) for which Landlord is reimbursed, whether by insurance proceeds or otherwise, and (6) cost of trusts, or any service furnished to any other security devices covering occupant of the ProjectBuilding which Landlord does not provide to Tenant. Operating Costs shall also include the yearly amortization of capital costs incurred by the Landlord for improvements or structural repairs to the Project required to comply with any change after the commencement date a property management fee and/or an administrative fee in the laws, rules or regulations aggregate of any governmental authority having jurisdiction, or for purposes of reducing Operating Costs five percent (other than by replacement of worn out and obsolete equipment or building components), which costs shall be amortized over the useful life of such improvements or repairs, as reasonably estimated by the Landlord, but in no event in excess of the savings. The management fee shall not exceed 3% of Tenant's Base Rent and Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site manager, any administrative or overhead expenses, any special assessments or charges in the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with or as a consequence of the development of the Project. As soon as reasonably practicable prior to the commencement of each calendar year during the Term, Landlord shall furnish to Tenant an estimate of Operating Costs for the ensuing calendar year and Tenant's Proportionate Share thereof. Tenant shall pay, as additional rent hereunder together with each installment of Base Rent, one-twelfth (1/12th5%) of its estimated annual Proportionate Share of Operating Costs. As soon as reasonably practicable after gross receipts from the end of each calendar year during the Term and in any event within 120 days, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share of Operating Costs, and within thirty (30) days thereafter Tenant shall pay to Landlord, or Landlord shall credit to the next rent payments due Landlord from Tenant, as the case may be, any difference between the actual Operating Costs and the estimated Operating Costs paid by Tenant. Tenant's Proportionate Share of Operating Costs for the years in which this Lease commences and terminates shall be prorated by multiplying the actual Operating Costs by a fraction the numerator of which is the number of days of that year of the Term and the denominator of which is 365Property. Notwithstanding any other provision anything contained herein to the contrary, (i) all expenditures for replacements or improvements of $10,000 or less shall be included in Operating Costs and (ii) the amount allowed annually as depreciation for federal income tax purposes with respect to any capital improvements made after the date of this Lease which are intended to reduce Operating Costs or which are required under any governmental laws, regulations, or ordinances which were not applicable to the Building at the time it is agreed that was constructed, shall be included in Operating Costs. In addition, interest on the undepreciated cost of any such improvement (at the long term mortgage loan rate set forth in the mortgage encumbering the Building on the date the cost of such improvement was incurred or, if there was no such loan, then at the long term mortgage loan rate that would have been available to Landlord on the date the cost of such improvement was incurred as reasonably determined by Landlord) shall also be included in Operating Costs. In the event Landlord elects to self insure, insure with a deductible in excess of $1,000 or obtain insurance coverage in which the premium fluctuates in proportion to losses incurred, then Landlord shall estimate the amount of premium that the Project Landlord would have been required to pay to obtain insurance coverage (or insurance coverage without such provision) with a recognized carrier and such estimated amount shall be deemed to be an Operating Cost. If Landlord is not fully occupied at furnishing any time during particular work or service (the Termcost of which, an adjustment if performed by Landlord, would be included in Operating Costs) to a tenant who has undertaken to perform such work or service in lieu of the performance thereof by Landlord, Operating Expenses shall be made in computing deemed for the management fee component purposes of this paragraph to be increased by an amount equal to the additional Operating Costs 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. Landlord may, in a reasonable manner, allocate insurance premiums for such year so that so-called “blanket” insurance policies which insure other properties as well as the management fee component of Building and said allocated amount shall be deemed to be an Operating Cost. If Landlord selects the accrual accounting method rather than the cash accounting method for Operating Costs purposes, Operating Costs shall be computed for deemed to have been paid when such year as though the Project had been fully occupied during such year. For a period of three (3) years following Tenant's receipt of Landlord's statement of actual Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in the offices where Landlord maintains its accounting records. No subtenant will expenses have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result of the auditaccrued.
Appears in 1 contract
Samples: Office Lease Agreement (Mountains West Exploration Inc)
Operating Costs. A. Tenant shallshall pay to Landlord, for as additional rent during the entire Term, pay Tenant's proportionate share of property taxes, assessments, insurance and costs of maintenance, repairs to Landlord as an item the Project, including down spouts, gutters, painting, and proportionate share of additional rent, without any setoff or deduction therefrom, its Proportionate Share of costs ("Operating Costs") which Landlord may incur in maintaining and operating , as hereinafter defined, calculated on the Project during each calendar year basis of the Termratio set forth herein. "Proportionate Share" is defined as the decimal equivalent of a fraction, the numerator of which is the rentable area of the Premises and the denominator of which is the rentable area within the entire Building. The term "Operating Costs" are defined to include shall mean any and all reasonable expenses expenses, costs and costs (but not specific costs disbursements of any kind and nature whatsoever incurred by Landlord in connection with the ownership, management, maintenance, operation and repair of the Development which are separately billed to and paid by individual tenants, including Tenant) which the Landlord shall pay or become obligated to pay because during a certain calendar year (regardless of or in connection with when such Operating Costs were incurred). The Operating Costs shall be incurred by Landlord for the operation purpose of operating and maintenance of maintaining the Project in a condition of similar quality to that of developments similar in nature. The Operating Costs shall include, but are not limited to, the sprinkler systems, the costs of maintaining and supporting facilities repairing parking lots, parking structures and easements, the elevator in the Building and other common areas of the Project, including but not limited to all real estate taxes and annual installments of special assessments payable in such calendar year with respect to the Project; costs of any contest of such taxes, including reasonable attorney's fees; management fees (except that no a property management fee shall be charged during such period(sof ten (10%) that Tenant elects to maintain and manage the common areas pursuant to Section 10), insurance premiums, utility costs, security costs, costs of wages, maintenance costs (relating to the Project including sidewalks, landscaping and parking or service areas, common areas, service contracts, equipment and supplies) and all other costs of any nature whatsoever which for federal tax purposes may be expensed rather than capitalized, all in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, costs of leasehold improvements and payments of principal and interest on any mortgages, deeds of trusts, or other security devices covering the Project. Operating Costs shall also include the yearly amortization of capital costs incurred by the Landlord for improvements or structural repairs to the Project required to comply with any change after the commencement date in the laws, rules or regulations of any governmental authority having jurisdiction, or for purposes of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building components), which costs shall be amortized over the useful life of such improvements or repairs, as reasonably estimated by the Landlord, but in no event in excess percent of the savings. The management fee shall not exceed 3% of Tenant's Base Rent and Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site manager, any administrative or overhead expenses, any special assessments or charges in the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with or as a consequence of the development of the Project. As soon as reasonably practicable prior to the commencement of each calendar year during the Term, Landlord shall furnish to Tenant an estimate of Operating Costs for the ensuing calendar year and Tenant's Proportionate Share thereof. Tenant shall pay, as additional rent hereunder together with each installment of Base Rent, one-twelfth (1/12th) of its estimated annual Proportionate Share of Operating Costs. As soon as reasonably practicable after the end of each calendar year during the Term and in any event within 120 days, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share total of Operating Costs, salaries, fringe benefits and within thirty (30) days thereafter Tenant shall pay related costs payable to Landlordemployees of Landlord whose duties are connected with the Project, or Landlord shall credit insurance costs, all heating and air conditioning costs, electricity, sewer and water and other utility costs not separately metered to tenants of the next rent payments due Landlord from TenantProject, landscape maintenance, trash and snow removal pest extermination, Taxes, as defined in this Section 7, and costs and expenses incurred by Landlord in protesting any assessments, levies or the case may be, any difference between the actual Operating Costs and the estimated Operating Costs paid by Tenanttax rate. Tenant's Proportionate Share of Operating Costs for the years in which this Lease commences and terminates shall be prorated by multiplying the actual Operating Costs by a fraction the numerator of which is the number of days of that year of the Term and the denominator of which is 365. Notwithstanding any other provision herein to the contrary, it is agreed that in the event that the Project is not fully occupied at any time during the Term, an adjustment shall be made in computing the management fee component of the Operating Costs for such year so that the management fee component of the The Operating Costs shall be computed not include the following; (i) costs of alterations of any tenant's premises; (ii) costs of curing construction defects; (iii) depreciation; (iv) interest and principal payments on mortgages, and other debt costs; (v) real estate broker’s leasing commissions or compensation; (vi) any cost or expenditure (or portion thereof) for such year as though which Landlord is reimbursed, whether by insurance proceeds or otherwise; (vii) cost of any service furnished to any other occupant of the Project had been fully occupied during such year. For a period of three that Landlord does not provide to Tenant; and (3viii) years following Tenant's receipt of Landlord's statement of actual Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in the offices where Landlord maintains its accounting records. No subtenant will have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result of the auditcapital improvements.
Appears in 1 contract
Operating Costs. Tenant shall, for the entire Term, pay to Landlord as an item of additional rent, without any setoff or deduction therefrom, its Proportionate Share of costs ("Operating Costs") which Landlord may incur in maintaining and operating the Project during each calendar year of the Term. "Proportionate Share" is defined as the decimal equivalent of a fraction, the numerator of which is the rentable area of the Premises and the denominator of which is the rentable area within the entire Building. The term "Operating Costs" are defined to include means the total amounts paid or payable by Landlord, or others on behalf of Landlord, in any calendar year, in connection with the ownership, maintenance, repair and operations of the Project, including the Building and, including without limiting the generality of the foregoing, the amounts paid for all reasonable expenses energy and costs (fuel used in connection with common areas and used in and about the Project, but not specific costs which are separately billed in the Demised Premises, the amount paid for all electricity furnished to the Project, other than electricity furnished to and paid for by individual tenantstenants in accordance with their separate meters; the amount paid for all hot and cold water other than that chargeable to tenants by reason of their extraordinary consumption of water; the amount paid for all labor and/or wages and other payments including cost to Landlord of workmen's compensation and disability insurance, including Tenant) which payroll taxes, welfare and fringe benefits made to janitors, security personnel, employees, contractors and subcontractors of the Landlord shall pay or become obligated to pay because of or involved in connection with the operation and maintenance of the Project Project; sewer taxes and supporting facilities charges; Real Estate Taxes (as are hereinafter described); managerial, administrative and telephone expenses related to the Project; the total charges of any independent contractors employed in the care and operation, maintenance and cleaning of the Project, including but not limited to snow and trash removal and landscaping; the amount paid for all real estate taxes and annual installments of special assessments payable in such calendar year with respect to the Project; costs of any contest of such taxessupplies, including reasonable attorney's fees; management fees (except that no management fee shall be charged during such period(s) that Tenant elects to maintain and manage the common areas pursuant to Section 10), insurance premiums, utility costs, security costs, costs of wages, maintenance costs (relating to the Project including sidewalks, landscaping and parking or service areas, common areas, service contractstools, equipment and supplies) necessities which are occasioned by everyday wear and all tear; the cost of accounting services necessary to compute the rents and charges payable by tenants; legal, inspection and consulting services; the cost of pest control; the cost of guards and other costs of any nature whatsoever which for federal tax purposes may be expensed rather than capitalized, all in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, costs of leasehold improvements and protection services; payments of principal general maintenance and interest on any mortgagesrepairs to the plant and equipment supplying climate control; and the amount paid for premiums for all insurance required or deemed desirable from time to time by Landlord or Landlord's mortgagee(s), deeds including without limitation loss of trusts, rent or other security devices covering the Projectbusiness interruption insurance. Operating Costs shall also not, however, include the yearly amortization interest on debt, capital retirement of debt, costs properly chargeable to capital costs incurred by the Landlord account except for improvements or structural repairs to the Project required to comply with any change after the commencement date capital expenditures which reduce operating expenses in the laws, rules or regulations of any governmental authority having jurisdiction, or for purposes of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building components), which costs case such expenditures shall be amortized over the useful life of the object for such improvements capital expenditure, or repairs, as reasonably estimated by the Landlord, but in no event in excess any cost which is charged to and collected from any tenant of the savingsProject on account of any negligent or willful act or omission of such tenant or for which such tenant may be liable, contractually or otherwise. The management fee shall not exceed 3% of Tenant's Base Rent and Operating Costs (determined without reference to any management fee "Project" in this subparagraph (b) shall include all related facilities, including sidewalks, loading and/or parking areas and driveways, landscaping, curbs, curb cuts and other public areas in or taxes around the Building, other buildings and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site manager, any administrative or overhead expenses, any special assessments or charges improvements in the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with or as a consequence of the development of the Project. As soon as reasonably practicable prior The provision or termination of such services or others and the degree thereof shall be determined by Landlord. Moreover, when Landlord causes services to the commencement of each calendar year during the Termbe rendered by independent third parties, Landlord shall furnish to Tenant an estimate of Operating Costs have no liability for the ensuing calendar year and Tenant's Proportionate Share thereof. Tenant shall payperformance thereof or liability therefor, as additional rent hereunder together with each installment of Base Rent, one-twelfth (1/12th) of its estimated annual Proportionate Share of Operating Costs. As soon as reasonably practicable after the end of each calendar year during the Term and in any event within 120 days, provided that Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share of Operating Costs, and within thirty (30) days thereafter Tenant shall pay to Landlord, or Landlord shall credit to the next rent payments due Landlord from Tenant, as the case may be, any difference between the actual Operating Costs and the estimated Operating Costs paid by Tenant. Tenant's Proportionate Share of Operating Costs for the years in which this Lease commences and terminates shall be prorated by multiplying the actual Operating Costs by a fraction the numerator of which is the number of days of that year of the Term and the denominator of which is 365. Notwithstanding any other provision herein to the contrary, it is agreed that has not been grossly negligent in the event that the Project is not fully occupied at any time during the Term, an adjustment shall be made in computing the management fee component of the Operating Costs for such year so that the management fee component of the Operating Costs shall be computed for such year as though the Project had been fully occupied during such year. For a period of three (3) years following Tenant's receipt of Landlord's statement of actual Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books hiring and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in the offices where Landlord maintains its accounting records. No subtenant will have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost supervision of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result of the auditthird parties.
Appears in 1 contract
Samples: Lease (Cell Pathways Inc)
Operating Costs. Except as provided in Section 3.3, Tenant shallshall pay the Operating Costs to Landlord, for as Additional Rent, beginning on the entire Term, pay to Landlord as an item of additional rent, without any setoff or deduction therefrom, its Proportionate Share of costs ("Operating Costs") which Landlord may incur in maintaining Commencement Date and operating throughout the Project during each calendar year remainder of the Term. "Proportionate Share" is defined as the decimal equivalent of a fractionAs used in this Lease, the numerator of which is the rentable area of the Premises and the denominator of which is the rentable area within the entire Building. term "Operating Costs" shall mean any and all expenses, costs and disbursements of any kind and nature whatsoever paid or incurred by Landlord in connection with and properly allocable to the management, maintenance, operation and repair of the Building, including, without limitation, the costs of maintaining and repairing the Common Areas and the Parking Facility, to the extent allocable to the Building, easements, property management fees (which fees shall not exceed two and one-half percent (2.5%) of Rents billed by Landlord to Tenant for the Premises, but excluding Operating Costs (other than Taxes) which are defined billed directly to include all reasonable Tenant by the supplier thereof and are paid by Tenant directly to such supplier), expenses for maintenance salaries, fringe benefits and related costs for personnel providing building supervisory and maintenance services for the Premises at the rank of building manager and below, which for such persons also working on properties other than the Building and the Land shall be allocated on the basis of the time spent working on the Building and the Land, the cost of insurance coverages obtained by Landlord, heating and air conditioning costs for Common Areas (if any), electricity and other utility costs, the costs of routine repairs and maintenance for the Building, landscape maintenance, snow removal, Taxes and costs (but not specific costs and expenses paid or incurred by Landlord in protesting any assessments, valuations, levies or the Taxes which are separately billed to and paid by individual tenants, including Tenant) which the Landlord shall pay or become obligated to pay because in respect of a fiscal tax year (regardless of when such Operating Costs were incurred), the costs of maintaining the Cafeteria Space, the costs of maintaining the Fitness Space, the Building's share (as reasonably determined by Landlord) of the cost of operating, maintaining and repairing any areas, facilities or in connection easements which are common to the Building and any other properties or buildings sharing common facilities with the operation and maintenance of the Project and supporting facilities of the ProjectBuilding (such as, including but not limited to, Parking Facility repair, operation and maintenance, snow plowing and removal, landscaping, Common Area and street lighting, insurance, taxes, security and management but specifically excluding costs, maintenance or repair or Taxes related to all real estate taxes Winter Place) and annual installments amortization of special assessments payable in such calendar year with respect the cost of capital improvements that are (A) made to reduce Operating Costs or limit increases therein, to the Project; costs of any contest extent of such taxesestimated savings in Operating Costs or to the estimated reduction in increases thereto) or (B) required by any applicable Law enacted after the date hereof or first interpreted to apply after the date hereof; provided, including reasonable attorney's fees; management fees (except that no management fee any such amortization or depreciation shall be charged during such period(s) that Tenant elects to maintain and manage the common areas pursuant to Section 10), insurance premiums, utility costs, security costs, costs of wages, maintenance costs (relating to the Project including sidewalks, landscaping and parking or service areas, common areas, service contracts, equipment and supplies) and all other costs of any nature whatsoever which for federal tax purposes may be expensed rather than capitalized, all in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, costs of leasehold improvements and payments of principal and interest calculated based on any mortgages, deeds of trusts, or other security devices covering the Project. Operating Costs shall also include the yearly amortization of capital costs incurred by the Landlord for improvements or structural repairs to the Project required to comply with any change after the commencement date in the laws, rules or regulations of any governmental authority having jurisdiction, or for purposes of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building components), which costs shall be amortized over the useful life of such improvements or repairs, as reasonably estimated by the Landlord, but in no event improvement and shall utilize a rate of interest that is not in excess of two percent over the savingsPrime Rate of interest that is in effect as of the date of the completion of such improvements or installation. The management fee shall not exceed 3% of Tenant's Base Rent and Notwithstanding the foregoing, "Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses Costs" shall not include any compensation or benefits for any off-site manager, any administrative or overhead expenses, any special assessments or charges in the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with or as a consequence of the development of the Project. As soon as reasonably practicable prior to the commencement of each calendar year during the Term, Landlord shall furnish to Tenant an estimate of Operating Costs for the ensuing calendar year and Tenant's Proportionate Share thereof. Tenant shall pay, as additional rent hereunder together with each installment of Base Rent, one-twelfth (1/12th) of its estimated annual Proportionate Share of Operating Costs. As soon as reasonably practicable after the end of each calendar year during the Term and in any event within 120 days, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share of Operating Costs, and within thirty (30) days thereafter Tenant shall pay to Landlord, or Landlord shall credit to the next rent payments due Landlord from Tenant, as the case may be, any difference between the actual Operating Costs and the estimated Operating Costs paid by Tenant. Tenant's Proportionate Share of Operating Costs for the years in which this Lease commences and terminates shall be prorated by multiplying the actual Operating Costs by a fraction the numerator of which is the number of days of that year of the Term and the denominator of which is 365. Notwithstanding any other provision herein to the contrary, it is agreed that in the event that the Project is not fully occupied at any time during the Term, an adjustment shall be made in computing the management fee component of the Operating Costs for such year so that the management fee component of the Operating Costs shall be computed for such year as though the Project had been fully occupied during such year. For a period of three (3) years following Tenant's receipt of Landlord's statement of actual Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in the offices where Landlord maintains its accounting records. No subtenant will have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result of the audit.following:
Appears in 1 contract
Operating Costs. A. For each calendar year falling partly or wholly within the Term or any extension thereof, Tenant shall, for the entire Term, shall pay to Landlord as an item of additional rent, without any setoff or deduction therefrom, its Proportionate Share of costs ("rent the Operating Costs") which Costs incurred by Landlord may incur in maintaining and operating the Project during each for such calendar year less any monthly payments paid by Tenant as provided below for such year. Any payment to be made pursuant to this Article V with respect to the year in which this lease commences or terminates shall be prorated. Notwithstanding the foregoing, during the first six months of this Lease, Tenant shall pay only one-third of the Term. "Proportionate Share" is defined as Operating Costs otherwise payable hereunder and during the decimal equivalent three months following the first six months, Tenant shall pay only two-thirds of a fractionthe Operating Costs otherwise payable hereunder.
B. As used in this Lease, the numerator of which is the rentable area of the Premises and the denominator of which is the rentable area within the entire Building. term "Operating Costs" are defined to include shall mean any and all reasonable expenses expenses, costs and costs disbursements (but not specific costs which are separately billed to other than Taxes) of any kind and paid nature whatsoever incurred by individual tenants, including Tenant) which the Landlord shall pay or become obligated to pay because of or in connection with the ownership, leasing, management, maintenance, operation and maintenance repair of the Project Building or the Property or any improvements situated on the Property (including, without limitation, the cost of maintaining and supporting facilities of the Projectrepairing parking lots, including but not limited to all real estate taxes parking structures, and annual installments of special assessments payable in such calendar year with respect to the Project; costs of any contest of such taxeseasements, including reasonable attorney's fees; property management fees (except that no management fee shall be charged during such period(s) that Tenant elects not to maintain and manage the common areas pursuant to Section 10), insurance premiums, utility costs, security costs, costs of wages, maintenance costs (relating to the Project including sidewalks, landscaping and parking or service areas, common areas, service contracts, equipment and supplies) and all other costs of any nature whatsoever which for federal tax purposes may be expensed rather than capitalized, all in accordance with Generally Accepted Accounting Principles, consistently applied but exclusive only of leasing commissions, depreciation, costs of leasehold improvements and payments of principal and interest on any mortgages, deeds of trusts, or other security devices covering the Project. Operating Costs shall also include the yearly amortization of capital costs incurred by the Landlord for improvements or structural repairs to the Project required to comply with any change after the commencement date in the laws, rules or regulations of any governmental authority having jurisdiction, or for purposes of reducing Operating Costs (other than by replacement of worn out and obsolete equipment or building components), which costs shall be amortized over the useful life of such improvements or repairs, as reasonably estimated by the Landlord, but in no event in excess of the savings. The management fee shall not exceed 32% of Tenant's Base Rent and Operating Costs (determined without reference to any management fee or taxes and special assessments). Operating Expenses shall not include any compensation or benefits for any off-site manager, any administrative or overhead expenses, any special assessments or charges in the nature of or in lieu of assessments which are now levied or pending or which are hereafter imposed or levied in connection with or as a consequence of the development of the Project. As soon as reasonably practicable prior to the commencement of each calendar year during the Term, Landlord shall furnish to Tenant an estimate of Operating Costs for the ensuing calendar year and Tenant's Proportionate Share thereof. Tenant shall pay, as total rent--including additional rent hereunder together with each installment of Base Rent, one-twelfth (1/12th) of its estimated annual Proportionate Share of Operating Costs. As soon as reasonably practicable after the end of each calendar year during the Term and in any event within 120 days, Landlord shall furnish to Tenant a statement of the actual Operating Costs for the previous calendar year, including Tenant's Proportionate Share of Operating Costs, and within thirty (30) days thereafter Tenant shall pay to Landlord, or Landlord shall credit to the next rent payments due Landlord from Tenant, as the case may be, any difference between the actual Operating Costs and the estimated Operating Costs rent--paid by Tenant), salaries, fringe benefits and related costs, for building staff, including building management and accounting personnel; insurance costs of such kind and nature as may be normal and customary for comparable buildings in the northern Chicago suburban market, heating and air conditioning costs, common area utility costs such as electricity, sewer and water charges, the cost of cleaning and removing snow from exterior areas, the cost of routine repairs, maintenance and decorating of exterior areas and the Building's or Property's share of costs of the Development). Tenant's Proportionate Share of Operating Costs To the extent personnel do work for other buildings in addition to the years in which this Lease commences and terminates Building, the costs associated with such personnel shall be prorated by multiplying allocated among the actual Operating Costs by a fraction buildings based upon the numerator of which is the number of days of that year of the Term and the denominator of which is 365time devoted to each. Notwithstanding any other provision anything contained herein to the contrary, depreciation of any capital improvements made after the date of this Lease which are intended to reduce Operating Costs or which are required under any governmental laws, regulations, or ordinances which were not applicable to the Building at the time it is agreed that was constructed, shall be included in Operating Costs (but in no event shall any costs of construction set forth in Exhibit B be included in Operating Costs). The useful life of any such improvement shall be the maximum period permitted by generally accepted accounting principles. In addition, interest on the undepreciated cost of any such improvement (at the prevailing construction loan rate available to Landlord on the date the cost of such improvement was incurred) shall also be included in Operating Costs. In the event Landlord elects to self insure, insure with a deductible in excess of $1,000 or obtain insurance coverage in which the premium fluctuates in proportion to losses incurred, then Landlord shall obtain three estimates from insurance agents of the amount of premium that Landlord would have been required to pay to obtain insurance coverage (or insurance coverage without such provision) with a recognized carrier and the Project is not fully occupied at any time during the Term, an adjustment lowest such estimated amount shall be made deemed to be an Operating Cost. Landlord may, in computing a reasonable manner, allocate insurance premiums for so-called "blanket" insurance policies which insure other properties as well as the management fee component of Building and said allocated amount shall be deemed to be an Operating Cost. If Landlord selects the accrual accounting method rather than the cash accounting method for Operating Costs for such year so that the management fee component of the purposes, Operating Costs shall be computed for deemed to have been paid when such year as though the Project had been fully occupied during such year. For a period of three (3) years following Tenant's receipt of Landlord's statement of actual Operating Costs, Landlord shall keep available for Tenant's inspection and/or audit complete books and records relating to Operating Costs. During this period Tenant may copy, inspect and/or audit Landlord's Operating Costs books and records upon reasonable notice to Landlord. The audit must be performed during regular business hours in the offices where Landlord maintains its accounting records. No subtenant will expenses have the right to audit under this provision. An assignee may have the right to audit as provided herein, however, such right shall only apply to the assignee's term pursuant to the Lease. In the event a discrepancy of three percent (3%) or more is found in favor of Tenant, Landlord shall pay the cost of such audit. If the audit discloses an overcharge by Landlord, Landlord shall reimburse Tenant for such overcharge within twenty (20) days, unless Landlord disputes the result of the auditaccrued.
Appears in 1 contract