Common use of Operating Expense Adjustment Clause in Contracts

Operating Expense Adjustment. In the event that Tenant's proportionate share of projected operating expenses for common area services as described in Paragraphs 4, 6, and 10 exceeds the amount specified in Paragraph 4 (a), (such excess to be called "Excess Operating Expenses"), Tenant agrees to pay Landlord monthly, as an additional rental, one twelfth (1/12) of the projection of "Excess Operating Expenses". The most recent projection for "Excess Operating Expenses" for the building and/or project is $1.27 per square foot per year. Tenant's proportionate share of this projection of "Excess Operating Expenses" amounts to a monthly charge of $15,629.47, for which the Tenant will be separately billed. On or about April 15 of each calendar year during Tenant's occupancy and the calendar year following termination of this lease, or as soon thereafter as is practical, Landlord shall furnish to Tenant a statement in reasonable detail of the actual Operating Expenses for the previous year. If for any calendar year Tenant's payments on account for Excess Operating Expenses exceeds Tenant's proportionate share of the actual Excess Operating Expenses, Landlord shall either credit the overpayment against the next installment of rent due from Tenant or promptly refund to Tenant the overpayment. Conversely, if the payments made by Tenant on account of the prior year's Excess Operating Expenses are less than Tenant's proportionate share of the actual Excess Operating Expenses, Tenant shall pay to Landlord, within thirty (30) days after receipt of such statement, as additional rent, the underpayment with respect to Tenant's Proportionate Share of the Excess Operating Expenses for the prior year. Landlord, upon notice to Tenant, may elect to lower or raise the projected cost paid monthly by Tenant so that Tenant's payments are equal to the adjusted projection of "Excess Operating Expenses".

Operating Expense Adjustment. In Tenant shall pay to Landlord as Additional Rent, in addition to the event that Base Rent required by Article 3 hereof, an amount (“Expense Adjustment Amount”) equal to Tenant's proportionate share ’s Proportionate Share of projected operating expenses for common area services as described the combined total of Operating Expenses (determined on an accrual basis) paid or incurred during each Calendar Year. The Expense Adjustment Amount with respect to each Calendar Year shall be paid in Paragraphs 4, 6, monthly installments in an amount from time to time estimated by Landlord and 10 exceeds the amount specified in Paragraph 4 (a), (such excess communicated by written notice to Tenant. Landlord shall cause to be called "Excess kept books and records showing Operating Expenses")Expenses in accordance with generally accepted accounting principles, Tenant agrees to pay Landlord monthly, consistently applied. As promptly as an additional rental, one twelfth (1/12) of practical following the projection of "Excess Operating Expenses". The most recent projection for "Excess Operating Expenses" for the building and/or project is $1.27 per square foot per year. Tenant's proportionate share of this projection of "Excess Operating Expenses" amounts to a monthly charge of $15,629.47, for which the Tenant will be separately billed. On or about April 15 close of each calendar year during Tenant's occupancy and the calendar year following termination of this lease, or as soon thereafter as is practicalCalendar Year, Landlord shall furnish cause the amount of the Expense Adjustment Amount for such Calendar Year to be computed based upon the actual Operating Expenses paid or incurred for such Calendar Year and Landlord shall deliver to Tenant a statement in reasonable detail of such amount and the actual Operating Expenses for the previous year. If for any calendar year Tenant's payments on account for Excess Operating Expenses exceeds Tenant's proportionate share amount of the actual Excess Operating Expenses, Landlord shall either credit the overpayment against the next installment of rent due from Tenant or promptly refund to Tenant the overpayment. Conversely, if the payments made all estimated installments paid by Tenant on account of the prior year's Excess Operating Expenses are less than Tenant's proportionate share of the actual Excess Operating Expenses, for such Calendar Year. Tenant shall pay to Landlord, Landlord any deficiency as shown by such statement within thirty (30) days after receipt of such statement, . This statement as additional rent, to the underpayment with respect amount of Operating Expenses for such Calendar Year for the Building shall constitute a determination which is final and conclusive on Tenant subject to Tenant's Proportionate Share Section 4E below. If the total of the Excess estimated monthly installments paid by Tenant during any Calendar Year exceeds the actual amount due from Tenant for such Calendar Year, at Landlord’s option, such excess shall be either credited against payments next due hereunder or refunded by Landlord within thirty (30) days, provided Tenant is not then in default hereunder. In determining the amount of Operating Expenses for the prior purposes of this paragraph, if less than 95 percent of the rentable area of the Building shall have been occupied by tenants and fully used by them during the year. Landlord, upon notice Operating Expenses shall be deemed for the purposes of this paragraph to Tenant, may elect to lower or raise the projected cost paid monthly by Tenant so that Tenant's payments are equal be increased to the adjusted projection amount of "Excess Operating Expenses"operating expenses that would normally be expected to be incurred had occupancy been 95 percent and had full use been made during the entire period.

Operating Expense Adjustment. In the event that Tenant's proportionate share of projected operating expenses for common area services as described in Paragraphs 4, 6, and 10 exceeds the amount specified in Paragraph 4 (a), (such excess to be called "Excess Operating Expenses"), Tenant agrees to pay Landlord monthly, as an additional rental, one twelfth (1/12) of the projection of "Excess Operating Expenses". The most recent projection for "Excess Operating Expenses" for the building and/or project is $1.27 per square foot per year. Tenant's proportionate share of this projection of "Excess Operating Expenses" amounts to a monthly charge of $15,629.47, for which the Tenant will be separately billed. On or about April 15 of each calendar year during Tenant's occupancy and the calendar year following termination of this lease, or as soon thereafter as is practical, Landlord shall furnish to Tenant a statement in reasonable detail of the actual Operating Expenses for the previous year. If for any calendar year Tenant's payments on account for Excess Operating Expenses exceeds Tenant's proportionate share of the actual Excess Operating Expenses, Landlord shall either credit the overpayment against the next installment of rent due from Tenant or promptly refund to Tenant the overpayment. Conversely, if the payments made by Tenant on account of the prior year's Excess Operating Expenses are less than Tenant's proportionate share of the actual Excess Operating Expenses, Tenant shall pay to Landlord, within thirty (30) days after receipt of such statement, as additional rent, the underpayment with respect to rent Tenant's ’s Proportionate Share of the Excess Operating Expenses amount by which operating expenses for the prior Building increase over those experienced by Landlord during the calendar year 2006 (base year). Effective January 1 of 2007 each year Landlord shall estimate the amount by which operating expenses are expected to increase, if any, over those incurred in the base year. LandlordMonthly rental for that year shall be increased by one-twelfth of Tenant’s share of the estimated increase. Following the end of each calendar year, upon notice to TenantLandlord shall compute the actual increase in operating expenses and bxxx Tenant for any deficiency or credit Tenant with any excess collected. As used herein “operating expenses” shall mean all costs of operating and maintaining the Building as determined by standard real estate accounting practice, may elect to lower or raise including, but not limited to: all water and sewer charges; the projected cost paid monthly by Tenant so that Tenant's payments are equal of natural gas and electricity provided to the adjusted projection Building; janitorial and cleaning supplies and services; administration costs and management fees; superintendent fees; security services, if any; insurance premiums; licenses, permits for the operation and maintenance of "Excess the Building and all of its component elements and mechanical systems; the annual amortized capital improvement cost (amortized over such a period as Landlord may select but not shorter than the period allowed under the Internal Revenue Code and at a current market interest rate) for any capital improvements to the Building required by any governmental authority. Operating Expenses"expenses shall not include: the cost of capital improvements (except as set forth above); depreciation; principal payments of mortgage and other non-operating debts of Landlord; the cost of repairs or other work to the extent Landlord is reimbursed by insurance or condemnation proceeds; costs in connection with leasing space in the Building, including brokerage commissions; lease concessions, rental abatements and construction allowances granted to specific tenants; costs incurred in connection with the sale, financing or refinancing of the Building; fines, interest and penalties incurred due to the late payment of taxes or expenses; organizational expenses associated with the creation and operation of the entity which constitutes Landlord; or any penalties or damages that Landlord pays to Tenant under this Lease or to other tenants in the Building under their respective leases.

Operating Expense Adjustment. In the event that Tenant's proportionate share of projected operating expenses for common area services as described in Paragraphs 4, 6, and 10 exceeds the amount specified in Paragraph 4 (a), (such excess to be called "Excess Operating Expenses"), Tenant agrees to pay Landlord monthly, as an additional rental, one twelfth (1/12) of the projection of "Excess Operating Expenses". The most recent projection for "Excess Operating Expenses" for the building and/or project is $1.27 per square foot per year. Tenant's proportionate share of this projection of "Excess Operating Expenses" amounts to a monthly charge of $15,629.47, for which the Tenant will be separately billed. On or about April 15 of each calendar year during Tenant's occupancy and the calendar year following termination of this lease, or as soon thereafter as is practical, Landlord shall furnish to Tenant a statement in reasonable detail of the actual Operating Expenses for the previous year. If for any calendar year Tenant's payments on account for Excess Operating Expenses exceeds Tenant's proportionate share of the actual Excess Operating Expenses, Landlord shall either credit the overpayment against the next installment of rent due from Tenant or promptly refund to Tenant the overpayment. Conversely, if the payments made by Tenant on account of the prior year's Excess Operating Expenses are less than Tenant's proportionate share of the actual Excess Operating Expenses, Tenant shall pay to Landlord, within thirty (30) days after receipt of such statement, as additional rent, the underpayment with respect to rent Tenant's Proportionate Share of the Excess Operating Expenses amount by which operating expenses for the prior Building increase over those experienced by Landlord during the calendar year 2009 (base year), Effective January 1 of each year Landlord shall estimate the amount by which operating expenses are expected to increase, if any, over those incurred in the base year. Landlord, upon notice to Tenant, may elect to lower or raise the projected cost paid monthly Monthly rental for that year shall be increased by Tenant so that one-twelfth of Tenant's payments are share of the estimated increase provided that Landlord may revise its estimate during any year with reasonable cause and the additional estimate shall be payable as equal additions to rent for the remainder of the calendar year. Following the end of each calendar year, Landlord shall compute the actual increase in operating expenses and xxxx Tenant for any deficiency or credit Tenant with any excess collected. Tenant shall pay any such deficiency within 30 days after Landlord's billing, whether or not this lease shall have expired or terminated at the time of such billing. As used herein "operating expenses" shall mean all costs of operating and maintaining and repairing the Building as determined by standard real estate accounting practice, including, but not limited to: all water and sewer charges; the cost of natural gas and electricity provided to the Building; janitorial and cleaning supplies and services; administration costs and management fees; superintendent fees; security services, if any; insurance premiums; licenses, permits for the operation and maintenance of the Building and all of its component elements and mechanical systems; ordinary and emergency repairs and maintenance, and a reserve equal to one-half percent (.05%) of gross rental income for the adjusted projection Property to be expended on roof replacement, exterior painting, asphalt resurfacing, and other miscellaneous matters not specified in the preceding and the annual amortized capital improvement cost (amortized over such a period as Landlord may select but not shorter than the life of the improvement and at current market interest rate) for any capital improvements to the Building required by any governmental authority or those which have a reasonable probability of improving the operating efficiency of the Building. "Excess Operating Expenses"" shall also include all assessments under recorded covenants or master plans and/or by owner's associations. If electricity or other energy costs increase between the date of this Lease and last day of the Base Year, (i) Tenant shall pay to Landlord on a monthly basis as additional rent, its Proportionate Share of such cost increase for the period from the date of such increase until the first estimated payment due under this paragraph, and (ii) Landlord may adjust the calculation of Base Year operating expenses by using the energy costs in effect on the date of this Lease.

Operating Expense Adjustment. In the event that Tenant's proportionate Tenant shall pay as additional rent Tenants Proportionate share of projected the amount by which operating expenses for common area services as described in Paragraphs 4, 6, and 10 exceeds the Building Increase over those experienced by Landlord during the calendar year 2000 (base year). Effective January I of each year Landlord shall estimate the amount specified in Paragraph 4 (a)by which operating expenses are expected to Increase, (such excess to N any, over those incurred In the base year. Monthly rental for that year shall be called "Excess Operating Expenses"), Tenant agrees to pay Landlord monthly, as an additional rental, one increased by one-twelfth (1/12) of Tenants share of the projection of "Excess Operating Expenses"estimated increase. The most recent projection for "Excess Operating Expenses" for Following the building and/or project is $1.27 per square foot per year. Tenant's proportionate share of this projection of "Excess Operating Expenses" amounts to a monthly charge of $15,629.47, for which the Tenant will be separately billed. On or about April 15 end of each calendar year during Tenant's occupancy and the calendar year following termination of this lease, or as soon thereafter as is practicalyear, Landlord shag compute the actual increase in operating expenses and bill Xxxant for any deficiency or credit Tenant with any excess collected. As used herein *operating expenses shall furnish mean all costs of operating and maintaining the Building as determined by standard real estate accounting practice, Including , but not limited to: all water and sewer charges; the cost of natural gas and electricity provided to Tenant a statement in reasonable detail the building; Janitorial and cleaning supplies and services; administration costs and management fees at the same rate as during the base year; security services, if any, insurance premiums; licenses; permits for the operation and maintenance of the actual Operating Expenses for building and all of its component elements and mechanical systems; the previous year. If annual amortized capital improvement cost (amortized over such a period as Landlord may select bid not shorter than the period allowed under the Internal Revenue code and at a current market interest rate) for any calendar year Tenant's payments on account for Excess Operating Expenses exceeds Tenant's proportionate share capital Improvements to the Building required by any government authority or those which have a reasonable probability of improving the operating efficiency of the actual Excess Operating ExpensesBuilding. LANDLORD AGREES TO LIMIT ANNUAL INCREASES IN REAL ESTATE TAXES AND OPERATING EXPENSES TO 5%, Landlord shall either credit the overpayment against the next installment of rent due from Tenant or promptly refund to Tenant the overpaymentON A CUMULATIVE BASIS. ConverselyIN NO EVENT WILL TENANTS PROPORTIONATE SHARE, if the payments made by Tenant on account of the prior year's Excess Operating Expenses are less than Tenant's proportionate share of the actual Excess Operating ExpensesPLUS THE PROPORTIONATE SHARE OF ALL OTHER TENANTS EVER EXCEED 100% IF THE BUILDING IS NOT 100% OCCUPIED DURING THE BASE YEAR, Tenant shall pay to Landlord, within thirty (30) days after receipt of such statement, as additional rent, the underpayment with respect to Tenant's Proportionate Share of the Excess Operating Expenses for the prior year. Landlord, upon notice to Tenant, may elect to lower or raise the projected cost paid monthly by Tenant so that Tenant's payments are equal to the adjusted projection of "Excess Operating Expenses"THE ACTUAL OPERATING EXPENSES FOR THE BASE YEAR WILL BE GROSSED UP TO REFLECT THE EXPENSES AT 1W% OCCUPANCY.

Operating Expense Adjustment. In The parties each acknowledging that the event that Tenant's proportionate share of projected operating expenses for common area services as described in Paragraphs 4, 6, and 10 exceeds the amount Rent specified in Paragraph 4 (a), (such excess to be called "Excess Operating Expenses"), Tenant agrees to pay Landlord monthly, as an additional rental, one twelfth (1/12) Section 6. of the projection of "Excess Operating Expenses". The most recent projection Lease does not provide for "Excess Operating Expenses" for the building and/or project is $1.27 per square foot per year. Tenant's proportionate share of this projection of "Excess Operating Expenses" amounts to a monthly charge of $15,629.47, for which the Tenant will be separately billed. On or about April 15 of each calendar year during Tenant's occupancy and the calendar year following termination of this lease, or as soon thereafter as is practical, Landlord shall furnish to Tenant a statement in reasonable detail of the actual Operating Expenses for the previous year. If for any calendar year Tenant's payments on account for Excess Operating Expenses exceeds Tenant's proportionate share of the actual Excess Operating Expenses, Landlord shall either credit Real Estate Taxes, and Utility Costs (hereinafter called "Expenses") or any increase in the overpayment against Expenses which may hereafter affect the next installment Office Space or the Building; accordingly, during the term of rent due from Tenant or promptly refund to Tenant the overpayment. Converselythis Lease, if the payments made by Tenant on account of the prior year's Excess Operating Expenses are less than Tenant's proportionate share of the actual Excess Operating Expensesand any renewals thereof, Tenant shall pay to Landlord, within in the form of Additional Rent (plus any applicable sales tax), the base amount for the Expenses of $3.50 per square foot of the adjusted rentable area of the Office Space per annum ("Expense Base") and its proportionate share of increased Expenses over the Expense Base amount (as hereinafter defined), such proportionate share to be a fraction, the numerator of which is the total number of the Adjusted Rentable Square Feet contained in the Office Space and the denominator of which is the total number of Adjusted Total Rentable square footage in the Building. During the ensuing Lease Year, Tenant shall pay to Landlord, as and when Rent is due and payable hereunder, an amount equal to one-twelfth (1/12th) of Tenant's Expense Base and its proportionate share of the excess Expenses. If Landlord's fiscal year ends less than thirty (30) days prior to the end of the Lease Year, Landlord shall have thirty (30) days after receipt the end of its fiscal year to prepare and submit the required statement, and, upon submission of such statement, as additional rentTenant shall pay 1/12th of its Expense Base and its proportionate share of the excess Expenses and a like amount of the first day of each calendar month thereafter commencing on the second month of each Lease Year. The term "Real Estate Taxes" shall mean the annual taxes and any special assessments or other charges levied against the real property of which the Office Space is a part by any authority having the direct power so to tax, including any city, county, state, or federal government, or any school, agricultural, transportation or environmental control agency, lighting, drainage, or other improvement district thereof, and shall include the expense of contesting the amount or validity of any such taxes, charges or assessments, the underpayment with respect to Tenant's Proportionate Share term "Operating Expenses" shall include the annual expenses of Landlord for the operation and maintenance of the Excess Operating Expenses Office Space and Building which are reasonable or customary for the prior year. Landlordoperation of this type of Office Space and Building, upon notice to Tenantand shall include, may elect to lower or raise the projected cost paid monthly by Tenant so that Tenant's payments are equal to the adjusted projection of "Excess Operating Expenses"but not be limited to, management salaries; maintenance and janitorial expenses; administrative salaries, costs and fees; insurance; security; landscaping; and site lighting.

Operating Expense Adjustment. Tenant shall pay as additional rent Tenant’s Proportionate Share of the amount by which operating expenses for the Building increase over those experienced by Landlord during the calendar year 2006 (base year). Effective January 1 of each year Landlord shall estimate the amount by which operating expenses are expected to increase, if any, over those incurred in the base year. Monthly rental for that year shall be increased by one-twelfth of Tenant’s share of the estimated increase. Following the end of each calendar year, Landlord shall compute the actual increase in operating expenses and xxxx Tenant for any deficiency or credit Tenant with any excess collected. As used herein “operating expenses” shall mean all costs of operating and maintaining the Building as determined by standard real estate accounting practice, including, but not limited to: all water and sewer charges; the cost of natural gas and electricity provided to the Building; janitorial and cleaning supplies and services; administration costs and management fees; superintendent fees; security services, if any; insurance premiums; licenses, permits for the operation and maintenance of the Building and all of its component elements and mechanical systems; the annual amortized capital improvement cost (amortized over such a period as Landlord may select but not shorter than the period allowed under the Internal Revenue Code and at a current market interest rate) for any capital improvements to the Building required by any governmental authority or those which have a reasonable probability of improving the operating efficiency of the Building. In the event that Tenant's proportionate share of projected operating expenses for common area services as described in Paragraphs 4the Building is not at least ninety-five percent (95%) occupied, 6, and 10 exceeds the amount specified in Paragraph 4 (a), (such excess to be called "Excess Operating Expenses"), Tenant agrees to pay Landlord monthly, as an additional rental, one twelfth (1/12) of the projection of "Excess Operating Expenses". The most recent projection for "Excess Operating Expenses" for the building and/or project is $1.27 per square foot per year. Tenant's proportionate share of this projection of "Excess Operating Expenses" amounts to a monthly charge of $15,629.47, for which the Tenant will be separately billed. On or about April 15 of each calendar year during Tenant's occupancy and the calendar year following termination of this lease, or as soon thereafter as is practical, Landlord shall furnish to Tenant a statement in reasonable detail of the actual gross up all Operating Expenses for the previous year. If for any calendar base year Tenant's payments on account for Excess Operating Expenses exceeds Tenant's proportionate share of and the actual Excess Operating Expenses, Landlord shall either credit the overpayment against the next installment of rent due from Tenant or promptly refund to Tenant the overpayment. Conversely, if the payments made by Tenant on account of the prior year's Excess Operating Expenses are less than Tenant's proportionate share of the actual Excess Operating Expenses, Tenant shall pay to Landlord, within thirty (30) days after receipt of such statement, as additional rent, the underpayment with respect to Tenant's Proportionate Share of the Excess Operating Expenses for the prior year. Landlord, upon notice to Tenant, may elect to lower or raise the projected cost paid monthly by Tenant so that Tenant's payments are equal comparison year to the adjusted projection of "Excess Operating Expenses"level they would have been at had the Building been ninety-five percent (95%) occupied.

Operating Expense Adjustment. In If the event that Tenant's proportionate share of projected operating expenses for common area services as described in Paragraphs 4, 6, and 10 exceeds the amount specified in Paragraph 4 Operating Expenses (a), (such excess to be called "Excess Operating Expenses"), Tenant agrees to pay Landlord monthly, as an additional rental, one twelfth (1/12defined below) of the projection of "Excess Operating Expenses". The most recent projection for "Excess Operating Expenses" for the building and/or project is $1.27 Building for any calendar year, expressed on a per square foot per yearbasis, exceed the Base Operating Expense Factor specified in Subsection 2.01(e) Lessee shall pay to Lessor increased Rent (an "Operating Expense Adjustment") in an amount equal to the product of such excess times the square feet of the Leased Premises as stated in Subsection 2.01 (b)). Tenant's proportionate share of this projection of "Excess The Operating Expenses" amounts to a Expense Adjustment shall be payable in monthly charge of $15,629.47, for which installments on the Tenant will be separately billed. On or about April 15 first day of each calendar year during Tenantmonth based on Lessor's occupancy and estimate of the Operating Expenses for the then current year. Lessor may at any time give Lessee written notice specifying Lessor's estimate of the Operating Expenses for the then current calendar year following termination or the subsequent calendar year and specifying the Operating Expense Adjustment to be paid by Lessee for each such year. Within one hundred twenty (120) days after the end of this leaseeach calendar year, or as soon thereafter as is practical, Landlord Lessor shall furnish give written notice to Tenant a statement in reasonable detail of Lessee specifying the actual Operating Expenses for the previous prior calendar year and any necessary adjustment to the Operating Expense Adjustment paid by Lessee for that calendar year. If for any calendar year Tenant's payments on account for Excess Operating Expenses exceeds Tenant's proportionate share of the actual Excess Operating Expenses, Landlord shall either credit the overpayment against the next installment of rent due from Tenant or promptly refund to Tenant the overpayment. Conversely, if the payments made by Tenant on account of the prior year's Excess Operating Expenses are less than Tenant's proportionate share of the actual Excess Operating Expenses, Tenant Lessee shall pay any deficit amount to Landlord, Lessor within thirty fifteen (3015) days after receipt of Lessor's written notice. Any excess payment by Lessee for the prior calendar year shall reduce the Operating Expense Adjustment for the following calendar year. (For purposes herein, for any calendar year, any such statementdeficit amount Lessee is to pay Lessor, as additional rent, or any excess payment Lessee may reduce its Operating Expense Adjustment for the underpayment with respect to Tenant's Proportionate Share following calendar year by shall be deemed the "tru-up".) In the event the tru- up for any calendar year is five percent (5%) of the Excess Operating Expenses or less. Lessee shall tru-up its Operating Expenses as set forth above; provided, however, if the tru-up for any calendar year is greater than five percent (5%) of the Operating Expenses, then Lessee may amortize such amount into its Operating Expense payments for the following calendar year. The provisions of this paragraph shall survive the cancellation or termination of this Lease Lessee shall have the right, one (1) time per year. with written notice to Lessor, to request Lessor to provide Lessee with a detailed itemization of the Operating Expenses for the prior any calendar year. Landlord, upon notice to Tenant, may elect to lower or raise the projected cost paid monthly by Tenant so that Tenant's payments are equal to the adjusted projection of "Excess Operating Expenses".

Operating Expense Adjustment. In a. For the event that Tenant's proportionate share purpose of projected operating expenses for common area services as described in Paragraphs 4this Article, 6the following definitions shall apply: Comparison Year. Each successive 12 month period after the Base Year. Direct Expenses. All direct costs of operation and maintenance of the Building and associated improvements, including parking and 10 exceeds the amount specified in Paragraph 4 (a), (such excess to be called "Excess Operating Expenses"), Tenant agrees to pay Landlord monthlyother Common Areas, as an additional rentaldetermined by standard accounting practices, one twelfth (1/12) including without limitation: real property taxes and assessments; water and sewer charges; insurance premiums; utilities; security; janitorial services; trash removal; costs incurred in the management of the projection Building and associated Real Property, if any, including administrative overhead and property management fees (said management fees not to exceed 5% of gross rental income); air conditioning and heating; elevator maintenance; supplies; materials; equipment and tools; plumbing and electrical systems; paving, re-paving and re-striping; and costs of maintenance, repair and replacement of all structures, improvements, facilities, equipment and systems. "Excess Operating Expenses". The most recent projection for "Excess Operating Direct Expenses" for shall not include depreciation on the building and/or project is $1.27 per square foot per yearBuilding or equipment therein, loan payments, executive salaries or real estate brokers' commissions. Tenant's proportionate Share of the Direct Expenses. 19.42% of the Direct Expenses for a Base or Comparison Year, representing the percentage of the total rentable area of the Building contained within the Premises. The Excess. The amount by which Tenant's share of actual or estimated Direct Expenses exceeds the Base Year Direct Expenses. b. All payments required by this projection Article shall constitute additional rent. c. Landlord shall endeavor to give to Tenant on or before the first day of the third month following the end of the Base Year and of each Comparison Year a statement (the "Excess Operating Statement") of: i. The Direct Expenses for the preceding Base or Comparison Year; ii. An estimate of the Direct Expenses for the current Comparison Year; iii. Either (1) the amount due from Tenant for Tenant's Share of the actual Direct Expenses for the preceding year over the Base Year Direct Expenses or, (2) if the payments by Tenant for the preceding year were in excess of Tenant's Share of actual Direct Expenses over the Base Year Direct Expenses" amounts , a statement of the refund due from Landlord to Tenant as hereinafter provided. Failure by Landlord to give the Statement by said date shall not constitute a monthly charge waiver by Landlord of $15,629.47, for which any of its rights under this Article. d. On the Tenant will be separately billed. On or about April 15 first day of each calendar year during Tenant's occupancy and the calendar year following termination of this lease, month commencing on or as soon thereafter as is practical, Landlord shall furnish to Tenant a statement in reasonable detail after receipt of the actual Operating Expenses Statement, and continuing until revised in the next annual Statement, Tenant shall pay to Landlord an amount equal to one-twelfth of the Landlord's estimate of the Excess for the previous then current Comparison Year as set forth in the Statement. In addition, on the first day of the first calendar month commencing on or after receipt of the Statement, Tenant shall pay to Landlord: (i) the Excess for the prior year (as reduced by all payments made by Tenant on account of the estimated Excess for that prior year) plus (ii) one-twelfth of the Landlord's estimate of the Excess for the then current Comparison Year times the number of months in the current 2 6 Comparison Year which commenced prior to receipt of the Statement, less all payments previously made by Tenant on account of the Excess for the current Comparison Year. If for any calendar year Tenant's payments on account for Excess Operating Expenses exceeds Tenant's proportionate share of the actual Excess Operating Expenses, Landlord shall either credit the overpayment against the next installment of rent due from payable by Tenant or promptly refund to Tenant the overpayment. Conversely, if for any Comparison Year as shown on a Statement is less than the payments made by Tenant on account of the estimated Excess for that Comparison Year, the overpayment by Tenant shall, so long as Tenant is not then in default and Landlord has no claim against Tenant for any prior year's Excess Operating default, be credited towards the next monthly Base Rent falling due. In no event, however, shall Tenant be entitled to a refund of the amount, if any, by which the Base Year Direct Expenses are less than exceeds Tenant's proportionate share Share of actual Direct Expenses. e. If the Lease expires on other than the last day of a Comparison Year, the amount of the actual Excess Operating Expensespayable by Tenant for that year shall be prorated. f. Even though the Term has expired or the Lease terminated and Tenant has vacated the Premises, when the final determination is made of the Excess for the Year in which this Lease terminates or for the preceding year, Tenant shall immediately pay any unpaid portion of the Excess, and conversely, so long as Tenant is not then in default and Landlord has no claim against Tenant for any prior default, any overpayment shall be refunded by Landlord to Tenant. g. The annual Statement shall be prepared in accordance with generally accepted accounting practices, shall be certified by Landlord, within thirty (30) days after receipt of such statement, as additional rent, the underpayment with respect to Tenant's Proportionate Share of the Excess Operating Expenses for the prior yearand shall be final and conclusive on both parties. Landlord, upon notice to Tenant, may elect to lower or raise the projected cost paid monthly by Tenant so that Tenant's payments are equal to the adjusted projection of "Excess Operating Expenses"6.

Operating Expense Adjustment. The Basic Annual Rental payable under paragraph 1(f) hereof is based, in part, on operating expenses existing during the calendar year in which the lease commences ("Base Year"). For the purposes of rental escalations under the terms of this Lease. said operating expenses are defined as and limited to: (i) ad valorem taxes, for which Landlord is liable, assessed against the land, Building and Improvements and in and upon which the Premises are located together with any special assessments and other real estate costs in the nature of taxes or assessments for which Landlord is responsible; (ii) expenses of operation, maintenance and repair of the land, Building, sidewalks and curbs adjacent thereto in a manner deemed reasonable and appropriate and for the best interest of the occupants; (iii) actual expenses incurred for employees, such as wages, fringe benefits, taxes, unemployment and disability insurance, workmen's compensation insurance, social security benefits and any other expenses incurred in connection with such employees. The term "employees" includes employees such as superintendents, engineers, electricians, clerks, mechanics, helpers, security officers, porters, cleaners, and window washers, as well as contract laborers performing services for the Building and other persons, firms or corporations providing contract services for the benefit of the Building; (iv) actual cost of materials and supplies used and consumed for the benefit of the Building and the occupants; (v) full contract cost of third-party contractors for all of the foregoing, including rubbish removal, elevator maintenance, maintenance of air conditioning, heating and ventilation equipment, management services, uniform supply, past control and security service; (vi) all utility services; and (vii) actual cost of insurance, including fire and extended coverage and general liability insurance, but no change for insurance is included that reflects premiums due to any act or omission of any tenant of the Building for which Landlord would be entitled to reimbursement from such tenant. Said operating expenses shall not include administrative salaries and wages of persons not involved in the day-to-day operations of the Building, state or federal income taxes or periodic alterations of improvements to the construction of the Building, and in no case shall Tenant be charged additional rent for any operating expense such as painting, repainting, redecorating, special cleaning service of special security service which can be directly related to the sole advantage of Landlord or any other particular occupant of the Building other than Tenant. Operating expenses shall not include cost of any repair or replacement which is or should be capitalized on Landlord's books under generally accepted accounting principles. In the event that Tenant's proportionate share of projected during the lease term said operating expenses for common area services as described in Paragraphs 4, 6, and 10 exceeds 1995 or any succeeding calendar year exceed the amount specified in Paragraph 4 (a), (such excess to be called "Excess Operating Expenses"), Tenant agrees to pay Landlord monthly, as an additional rental, one twelfth (1/12) of the projection of "Excess Operating Expenses". The most recent projection for "Excess Operating Expenses" for the building and/or project is $1.27 1994 expenses per square foot per year. Tenant's proportionate share of this projection of year ("Excess Operating Expenses" amounts to a monthly charge of $15,629.47, base expense rate") for which the Tenant will be separately billed. On or about April 15 of each calendar year during Tenant's occupancy and the calendar year following termination of this lease, or as soon thereafter as is practical, Landlord shall furnish to Tenant a statement in reasonable detail total Rentable Area of the actual Operating Expenses for the previous year. If for any calendar year Building (as defined in Paragraph 1(d) hereof), Tenant's payments on account for Excess Operating Expenses exceeds Tenant's proportionate share of the actual Excess Operating Expenses, Landlord shall either credit the overpayment against the next installment of rent due from Tenant or promptly refund to Tenant the overpayment. Conversely, if the payments made by Tenant on account of the prior year's Excess Operating Expenses are less than Tenant's proportionate share of the actual Excess Operating Expenses, Tenant shall pay to Landlord, within thirty (30) days after receipt of such statement, as additional rent, the underpayment with respect to Tenant's Proportionate Share written notification of the Excess Operating Expenses for the prior year. foregoing by Landlord, upon notice to Tenant, may elect to lower or raise the projected cost paid monthly by Tenant so that Tenant's payments are equal to the adjusted projection of "Excess Operating Expenses".shall: