Common use of Operating Expense Clause in Contracts

Operating Expense. (i) Tenant shall pay to Landlord as part of Additional Rent for each Operating Year during the Lease Term an amount equal to Tenant's Proportionate Share of Landlord's Operating Expense for such Operating Year ("Tenant's Operating Expense"). Tenant shall pay to Landlord as Additional Rent, Tenant's Operating Expense for each current Operating Year in equal monthly installments in the amount of one-twelfth (1/12) of Landlord's estimate of Tenant's Operating Expense for the current Operating Year based on (a) the Budget for the current Operating Year., or if such Budget shall not have been approved, on the actual Operating Expense for the Building for the Operating Year immediately preceding. (ii) Tenant's Operating Expense shall be paid (or credited) in the following manner: (a) Beginning with the Commencement Date and continuing thereafter on the first day of each month until receipt of the Operating Expense Statement with respect to the Operating Year in which this Lease commences, Tenant shall pay Landlord in equal monthly installments in advance, concurrently with payments of Basic Rent, an amount equal to one-twelfth (1/12) of the Operating Expense Estimate as specified in Landlord's written notice of its Operating Expense Estimate. If the Commencement Date of this Lease is not the first day of a month, the Operating Expense Estimate payment corresponding to the month in which the Lease Term begins shall be prorated and paid for that portion of the month between the Commencement Date and the end of such month. (b) Within 180 calendar days following the end of each Operating Year, Landlord shall furnish Tenant an Operating Expense Statement, setting forth the information described hereof under the definition of Operating Expense Statement. Within fifteen (15) calendar days following the receipt of such Operating Expense Statement (the "Expense Adjustment Date") Tenant shall pay to Landlord as Additional Rent: (1) the amount by which Tenant's Operating Expense for the Operating Year covered by the Operating Expense Statement exceeds the aggregate of the Operating Expense Estimate paid with respect to such Operating Year; and (2) the amount by which the Operating Expense Estimate as shown on the Operating Expense Statement for the current Operating Year, multiplied by the number of months elapsed in the current Operating Year including the month in which payment is made, exceeds the amount of payments of the Operating Expense Estimate in the Operating Year in which the Operating Expense Statement is issued. (c) On the first day of the first month following receipt by Tenant of any annual Operating Expense Statement and continuing thereafter on the first day of each succeeding month until the issuance of the next ensuing Operating Expense Statement, Tenant shall pay Landlord, as Additional Rent, the amount of the Operating Expense Estimate shown on the Expense Statement in equal monthly installments. Table of Contents (iii) Operating Expense" shall include the following expenses incurred by Landlord in connection with the operation, repair, maintenance, protection and management of the Building and the Lot: (a) The Landlord's share of common expenses ("Common Expenses") for the Building payable under the Ownership Agreement. (b) Premiums and other charges with respect to all insurance relating to the Leased Premises, and all improvements forming a part of the Leased Premises, includ-ing, but not limited to, physical damage insurance; property loss or damage insurance; comprehensive public liability insurance; and the deductible amount with respect to all insurance coverage set forth above to the extent that payment is made under the policy to cover a casualty covered by the policy. (c) The cost of providing electricity, water, sewer, air-conditioning and ventilation, and any and all other utility services, to the Leased Premises. (d) The cost incurred for operation, service, maintenance, inspection, repairs and alterations of (i) the Leased Premises, (ii) the security system of the Leased Premises; and (iii) the plumbing and electrical systems serving the Leased Premises; and the cost of labor, materials, supplies and equipment used in connection with all of the aforesaid items. (e) The cost of repainting or otherwise redecorating any part of the Leased Premises. (f) The cost of licenses, permits and similar fees and charges related to operation, repair and maintenance of the Leased Premises. (g) Reasonable management, accounting, and audit fees incurred in connection with the property management and the preparation and certification of Tax and Operating Expense Statements pursuant to this Section 6. (h) The Municipal License Tax of the Municipality of Carolina, any income or gross receipts tax that is limited to income from real property, miscellaneous taxes (other than Property Taxes) applicable to the Leased Premises. (i) All costs associated with the installation and maintenance of meters measuring the consumption of electricity and water for the Leased Premises. (iv) Notwithstanding the foregoing, "Operating Expense" shall not include expenditures for any of the following whether made directly by the Landlord or included in the Common Expenses paid by the Landlord: (a) The cost of any addition made to the Building, (except costs associated with the acquisition and installation or any energy or cost saving devices or costs incurred to comply with governmental requirements, whether federal, Commonwealth or municipal, or costs for repairs, replacements and improvements that are appropriate for the continued operation of the Building as a first-class office building or as set forth in subsection (iv)(e)(1) below), including the cost of preparing Building space for occupancy by a new tenant. (b) Repairs or other work occasioned by fire, hurricane, flooding, windstorm or other insured casualty or hazard, to the extent that Landlord shall receive proceeds of insurance therefore. (c) Leasing commissions and advertising expenses incurred in leasing or procuring new tenants. Table of Contents (d) Repairs or rebuilding necessitated by condemnation to the extent that Landlord has received condemnation proceeds for such repairs or rebuilding. (e) Depreciation and amortization of the Building or the Leased Premises, other than (1) capital expenditures that under GAAP are expenses or regarded as deferred expenses and (2) capital expenditures for energy or cost saving devices, or appropriate to a first class office building, or required by law as described in the exception to (iv)(a) above. (f) Franchise or income taxes imposed on Landlord. (g) The cost of any work or service performed for any tenant of the Building (other than Tenant) to a greater extent or to an immaterially more favorable manner than that furnished generally to the tenants and other occupants; and in no event shall Tenant pay for any tenant improvement for any other tenant. (h) The cost for any items for which Landlord is reimbursed by insurance, condemnation, refund, rebate or otherwise. (i) Interest and amortization on any mortgage or deed of trust and any rent paid on any ground or underlying lease. (j) Any cost representing an amount paid to an entity related to Landlord which is in excess of the amount which would have been paid in the absence of such relationship. (k) Any expenses for repairs or maintenance which are covered by warranties, guaranties and service contracts (excluding any mandatory deductible). (v) The Operating Expense shall be "net" and, for that purpose, shall be reduced by the amounts of any reimbursement received by Landlord with respect to extra air conditioning services provided to and charged to tenants.

Operating Expense. (i) If Landlord's Operating Expense for any Operating Year shall be greater than the Operating Expense Allowance, Tenant shall pay to Landlord as part of Additional Rent for each Operating Year during the Lease Term an amount equal to Tenant's Proportionate Share (as defined below) of Landlordthe difference (the amount of Tenant's Proportionate Share of such difference is hereinafter referred to as the "Operating Expense Adjustment"). If Tenant occupies the Leased Premises or portion thereof for less than full Operating Year, the Operating Expense Adjustment will be allocated proportionally to the amount of time in such Operating Year ("Tenant's Operating Expense")that Tenant so occupies such space. Tenant shall pay to Landlord as Additional Rent, Tenant's Operating Expense for each current Operating Year in equal monthly installments in the amount of one-twelfth (1/12) of Landlord's estimate of Tenant's Operating Expense for the current Operating Year based on (a) the Budget for the current Operating Year., or if such Budget shall not have been approved, on the actual Operating Expense for the Building for the Operating Year immediately preceding. (ii) Tenant's Operating Expense Such additional Rent shall be paid (or credited) in the following manner: : within one hundred twenty (a120) Beginning with the Commencement Date and continuing thereafter on the first day of each month until receipt of the Operating Expense Statement with respect to the Operating Year in which this Lease commences, Tenant shall pay Landlord in equal monthly installments in advance, concurrently with payments of Basic Rent, an amount equal to one-twelfth (1/12) of the Operating Expense Estimate as specified in Landlord's written notice of its Operating Expense Estimate. If the Commencement Date of this Lease is not the first day of a month, the Operating Expense Estimate payment corresponding to the month in which the Lease Term begins shall be prorated and paid for that portion of the month between the Commencement Date and the end of such month. (b) Within 180 calendar days following the end of each Operating Year, Landlord shall furnish Tenant an Operating Expense Statement, Statement setting forth (i) the information described hereof under the definition of Operating Expense Statementfor the preceding Operating Year, (ii) the Operating Expense Allowance and (iii) the Tenant's Operating Expense Adjustment for such Operating Year. Within fifteen (15) calendar days following the receipt of such Operating Expense Statement (the "Expense Adjustment Date") Tenant shall pay to Landlord as Additional Rent: (1) the amount by which Tenant's Operating Expense for the Operating Year covered by Rent the Operating Expense Statement exceeds Adjustment for such Operating Year. Commencing with the aggregate first month of the Lease Term, Tenant shall pay to Landlord, on account of the Operating Expense Estimate paid with respect to Adjustment for such Operating Year; and , monthly installments in advance equal to one-twelfth (21/12th) o the amount by which the estimated Operating Expense Estimate as shown on the Operating Expense Statement Adjustment for the current such Operating Year, multiplied by the number of months elapsed in the current Operating Year including the month in which payment is made, exceeds the amount of payments of the Operating Expense Estimate in the Operating Year in which the Operating Expense Statement is issued. (c) On the first day of the first month following receipt by Tenant of any annual Operating Expense Statement and continuing thereafter on the first day of each succeeding month until the issuance of . ON the next ensuing Operating succeeding Expense StatementAdjustment Date, Tenant shall pay Landlord, as Additional Rentto Landlord (or Landlord shall credit to Tenant) any deficiency (or excess) between the installments paid on account of the preceding year's Operating Expense Adjustment and the actual Operating Expense Adjustment for such Operating Year. As used in this Section 6 and Section 1 where applicable, the amount of the Operating Expense Estimate shown on the Expense Statement in equal monthly installments. Table of Contents (iii) Operating Expense" shall include the following expenses incurred by Landlord in connection with the operation, repair, maintenance, protection words and management of the Building and the Lot: (a) The Landlord's share of common expenses ("Common Expenses") for the Building payable under the Ownership Agreement. (b) Premiums and other charges with respect to all insurance relating to the Leased Premises, and all improvements forming a part of the Leased Premises, includ-ing, but not limited to, physical damage insurance; property loss or damage insurance; comprehensive public liability insurance; and the deductible amount with respect to all insurance coverage set forth above to the extent that payment is made under the policy to cover a casualty covered by the policy. (c) The cost of providing electricity, water, sewer, air-conditioning and ventilation, and any and all other utility services, to the Leased Premises. (d) The cost incurred for operation, service, maintenance, inspection, repairs and alterations of (i) the Leased Premises, (ii) the security system of the Leased Premises; and (iii) the plumbing and electrical systems serving the Leased Premises; and the cost of labor, materials, supplies and equipment used in connection with all of the aforesaid items. (e) The cost of repainting or otherwise redecorating any part of the Leased Premises. (f) The cost of licenses, permits and similar fees and charges related to operation, repair and maintenance of the Leased Premises. (g) Reasonable management, accounting, and audit fees incurred in connection with the property management and the preparation and certification of Tax and Operating Expense Statements pursuant to this Section 6. (h) The Municipal License Tax of the Municipality of Carolina, any income or gross receipts tax that is limited to income from real property, miscellaneous taxes (other than Property Taxes) applicable to the Leased Premises. (i) All costs associated with the installation and maintenance of meters measuring the consumption of electricity and water for the Leased Premises. (iv) Notwithstanding the foregoing, "Operating Expense" shall not include expenditures for any of the following whether made directly by the Landlord or included in the Common Expenses paid by the Landlord: (a) The cost of any addition made to the Building, (except costs associated with the acquisition and installation or any energy or cost saving devices or costs incurred to comply with governmental requirements, whether federal, Commonwealth or municipal, or costs for repairs, replacements and improvements that are appropriate for the continued operation of the Building as a first-class office building or as set forth in subsection (iv)(e)(1) below), including the cost of preparing Building space for occupancy by a new tenant. (b) Repairs or other work occasioned by fire, hurricane, flooding, windstorm or other insured casualty or hazard, to the extent that Landlord shall receive proceeds of insurance therefore. (c) Leasing commissions and advertising expenses incurred in leasing or procuring new tenants. Table of Contents (d) Repairs or rebuilding necessitated by condemnation to the extent that Landlord has received condemnation proceeds for such repairs or rebuilding. (e) Depreciation and amortization of the Building or the Leased Premises, other than (1) capital expenditures that under GAAP are expenses or regarded as deferred expenses and (2) capital expenditures for energy or cost saving devices, or appropriate to a first class office building, or required by law as described in the exception to (iv)(a) above. (f) Franchise or income taxes imposed on Landlord. (g) The cost of any work or service performed for any tenant of the Building (other than Tenant) to a greater extent or to an immaterially more favorable manner than that furnished generally to the tenants and other occupants; and in no event shall Tenant pay for any tenant improvement for any other tenant. (h) The cost for any items for which Landlord is reimbursed by insurance, condemnation, refund, rebate or otherwise. (i) Interest and amortization on any mortgage or deed of trust and any rent paid on any ground or underlying lease. (j) Any cost representing an amount paid to an entity related to Landlord which is in excess of the amount which would have been paid in the absence of such relationship. (k) Any expenses for repairs or maintenance which are covered by warranties, guaranties and service contracts (excluding any mandatory deductible). (v) The Operating Expense terms shall be "net" and, for that purpose, shall be reduced by the amounts of any reimbursement received by Landlord with respect to extra air conditioning services provided to and charged to tenants.defined as hereinafter set forth:

Operating Expense. (i) Tenant shall pay to Landlord Landlord, as part of Additional Rent for each Operating Year during the Lease Term an amount equal to additional rent, Tenant's ’s Proportionate Share of Landlord's Operating Expense for such Operating Year ("Tenant's Operating Expense")as defined below. Tenant shall pay to Landlord as Additional Rent, Tenant's Operating Expense for each current Operating Year in equal monthly installments in the amount of one-twelfth (1/12) of Landlord's estimate of Tenant's Operating Expense The parties agree for the current Operating Year based on (a) purpose of this Lease that Tenant’s Proportionate Share stated above has been calculated to represent the Budget for the current Operating Year., or if such Budget shall not have been approved, on the actual Premises’ pro rata share of Operating Expense for the Building for and the Common Areas exclusively serving the Building. Operating Year immediately preceding. Expense shall also include the Building’s pro rata share of any and all Operating Expense incurred with respect to (i) any Common Areas serving the Building and other buildings within the Project and (ii) the Chandler Airport Center Owners Association. The allocation of Operating Expense between the Building and any other buildings within the Project shall be determined by the Landlord, consistent with any recorded easements or other agreements governing such Operating Expense. The Tenant's ’s Proportionate Share stated above and any such allocation of Operating Expense between buildings within the Project shall be as reasonably determined by Landlord from time to time. Estimated amounts of such Operating Expense shall be paid (in monthly installments in advance on or credited) in the following manner: (a) Beginning with the Commencement Date and continuing thereafter on before the first day of each month until receipt during the Term. The initial estimated payment of the Tenant’s Proportionate Share of Operating Expense Statement with respect is set forth in Section 1.9. From time to time during the Term, Landlord may notify Tenant in writing of any adjustment to the Operating Year in which this Lease commencesmonthly installments to be paid by Tenant hereunder and, thereafter, Tenant shall pay Landlord in equal monthly installments in advance, concurrently with make payments of Basic Rent, an amount equal to one-twelfth accordingly. Within ninety (1/1290) of days after the Operating Expense Estimate as specified in Landlord's written notice of its Operating Expense Estimate. If the Commencement Date of this Lease is not the first day of a month, the Operating Expense Estimate payment corresponding to the month in which the Lease Term begins shall be prorated and paid for that portion of the month between the Commencement Date and the end of such month. (b) Within 180 calendar days following the end expiration of each Operating Yearcalendar year or as soon thereafter as is reasonably practicable, Landlord shall furnish notify Tenant an of the actual Operating Expense Statement, setting forth the information described hereof under the definition of Operating Expense Statementfor such calendar year and provide Tenant a statement thereof in reasonable detail. Within fifteen thirty (1530) calendar days following the receipt of after such Operating Expense Statement (the "Expense Adjustment Date") notice, Tenant shall pay to Landlord or Landlord shall credit against the obligations of Tenant, as Additional Rent: (1) the case may be, the difference between the estimated payments made by Tenant during the prior calendar year and the actual amount by which of Tenant's ’s Proportionate Share of Operating Expense as shown on such statement. Tenant’s Proportionate Share of Operating Expense for the Operating Year covered by the Operating Expense Statement exceeds the aggregate of the Operating Expense Estimate paid with respect to such Operating Year; and (2) the amount by years in which the Operating Expense Estimate as shown on the Operating Expense Statement for the current Operating Year, multiplied by Term commences and ends shall be prorated based upon the number of months elapsed in the current Operating Year including the month in which payment is made, exceeds the amount of payments days of the Term during such years. Tenant’s obligation to pay Tenant’s Proportionate Share of Operating Expense Estimate in through the Operating Year in which the Operating Expense Statement is issuedTermination Date shall survive termination. (c) On the first day of the first month following receipt by Tenant of any annual Operating Expense Statement and continuing thereafter on the first day of each succeeding month until the issuance of the next ensuing Operating Expense Statement, Tenant shall pay Landlord, as Additional Rent, the amount of the Operating Expense Estimate shown on the Expense Statement in equal monthly installments. Table of Contents (iii) Operating Expense" shall include the following expenses incurred by Landlord in connection with the operation, repair, maintenance, protection and management of the Building and the Lot: (a) The Landlord's share of common expenses ("Common Expenses") for the Building payable under the Ownership Agreement. (b) Premiums and other charges with respect to all insurance relating to the Leased Premises, and all improvements forming a part of the Leased Premises, includ-ing, but not limited to, physical damage insurance; property loss or damage insurance; comprehensive public liability insurance; and the deductible amount with respect to all insurance coverage set forth above to the extent that payment is made under the policy to cover a casualty covered by the policy. (c) The cost of providing electricity, water, sewer, air-conditioning and ventilation, and any and all other utility services, to the Leased Premises. (d) The cost incurred for operation, service, maintenance, inspection, repairs and alterations of (i) the Leased Premises, (ii) the security system of the Leased Premises; and (iii) the plumbing and electrical systems serving the Leased Premises; and the cost of labor, materials, supplies and equipment used in connection with all of the aforesaid items. (e) The cost of repainting or otherwise redecorating any part of the Leased Premises. (f) The cost of licenses, permits and similar fees and charges related to operation, repair and maintenance of the Leased Premises. (g) Reasonable management, accounting, and audit fees incurred in connection with the property management and the preparation and certification of Tax and Operating Expense Statements pursuant to this Section 6. (h) The Municipal License Tax of the Municipality of Carolina, any income or gross receipts tax that is limited to income from real property, miscellaneous taxes (other than Property Taxes) applicable to the Leased Premises. (i) All costs associated with the installation and maintenance of meters measuring the consumption of electricity and water for the Leased Premises. (iv) Notwithstanding the foregoing, "Operating Expense" shall not include expenditures for any of the following whether made directly by the Landlord or included in the Common Expenses paid by the Landlord: (a) The cost of any addition made to the Building, (except costs associated with the acquisition and installation or any energy or cost saving devices or costs incurred to comply with governmental requirements, whether federal, Commonwealth or municipal, or costs for repairs, replacements and improvements that are appropriate for the continued operation of the Building as a first-class office building or as set forth in subsection (iv)(e)(1) below), including the cost of preparing Building space for occupancy by a new tenant. (b) Repairs or other work occasioned by fire, hurricane, flooding, windstorm or other insured casualty or hazard, to the extent that Landlord shall receive proceeds of insurance therefore. (c) Leasing commissions and advertising expenses incurred in leasing or procuring new tenants. Table of Contents (d) Repairs or rebuilding necessitated by condemnation to the extent that Landlord has received condemnation proceeds for such repairs or rebuilding. (e) Depreciation and amortization of the Building or the Leased Premises, other than (1) capital expenditures that under GAAP are expenses or regarded as deferred expenses and (2) capital expenditures for energy or cost saving devices, or appropriate to a first class office building, or required by law as described in the exception to (iv)(a) above. (f) Franchise or income taxes imposed on Landlord. (g) The cost of any work or service performed for any tenant of the Building (other than Tenant) to a greater extent or to an immaterially more favorable manner than that furnished generally to the tenants and other occupants; and in no event shall Tenant pay for any tenant improvement for any other tenant. (h) The cost for any items for which Landlord is reimbursed by insurance, condemnation, refund, rebate or otherwise. (i) Interest and amortization on any mortgage or deed of trust and any rent paid on any ground or underlying lease. (j) Any cost representing an amount paid to an entity related to Landlord which is in excess of the amount which would have been paid in the absence of such relationship. (k) Any expenses for repairs or maintenance which are covered by warranties, guaranties and service contracts (excluding any mandatory deductible). (v) The Operating Expense shall be "net" and, for that purpose, shall be reduced by the amounts of any reimbursement received by Landlord with respect to extra air conditioning services provided to and charged to tenants.

Operating Expense. (i) Subject to the terms of the second following sentence, Tenant shall pay to Landlord Landlord, as part of Additional Rent for each Operating Year during the Lease Term hereunder, an amount equal to Tenant's Proportionate Share Percentage of Landlord's Operating Expense for such Operating Year ("Tenant's Operating Expense"). Tenant shall pay to Landlord as Additional Rent, Tenant's Operating Expense for each current Operating Year in equal monthly installments in the amount of one-twelfth (1/12) of Landlord's estimate of Tenant's Operating Expense for the current Operating Year based on (a) the Budget for the current Operating Year., or if such Budget shall not have been approved, on the actual Operating Expense for the Building for the Operating Year immediately preceding. (ii) Tenant's Operating Expense shall be paid (or credited) in the following manner: (a) Beginning with the Commencement Date and continuing thereafter on the first day of each month until receipt of the Operating Expense Statement with respect to the Operating Year in which this Lease commences, Tenant shall pay Landlord in equal monthly installments in advance, concurrently with payments of Basic Rent, an amount equal to one-twelfth (1/12) of the Operating Expense Estimate as specified in Landlord's written notice of its Operating Expense Estimate. If the Commencement Date of this Lease is not the first day of a month, the Operating Expense Estimate payment corresponding to the month in which the Lease Term begins shall be prorated and paid for that portion of the month between the Commencement Date and the end of such month. (b) Within 180 calendar days following the end of each Operating Year, Landlord shall furnish Tenant an Operating Expense Statement, setting forth the information described hereof under the definition of Operating Expense Statement. Within fifteen (15) calendar days following the receipt of such Operating Expense Statement (the "Expense Adjustment Date") Tenant shall pay to Landlord as Additional Rent: (1) the amount by which Tenant's Operating Expense for the Operating Year covered by the Operating Expense Statement exceeds the aggregate of the Operating Expense Estimate paid with respect to such Operating Year; and (2) the amount by which the Operating Expense Estimate as shown on the Operating Expense Statement for the current Operating Year, multiplied by the number of months elapsed in the current Operating Year including the month in which payment is made, exceeds the amount of payments of the Operating Expense Estimate in the Operating Year in which the Operating Expense Statement is issued. (c) On the first day of the first month following receipt by Tenant of any annual Operating Expense Statement and continuing thereafter on the first day of each succeeding month until the issuance of the next ensuing Operating Expense Statement, Tenant shall pay LandlordBuilding, as Additional Rentset forth in Section 1(e), the amount of the Operating Expense Estimate shown on the Expense Statement in equal monthly installments. Table of Contents (iii) Operating Expense" shall include the following all operating, maintenance, management, and repair expenses incurred by Landlord in connection with the operation, repair, maintenance, protection ownership and management operation of the Building Building, the Lot and the Lot: Premises for any "Operating Year" (a) as defined below), including without limitation the items described hereafter as "Operating Expense" in Section 7.A. (ii); said payments shall be made by Tenant in the manner and to the extent as set forth in Section 7.c. The Landlordamount of Tenant's share Percentage of common Building of such expenses (is hereinafter referred to as the "Common Expenses") Operating Expense Adjustment." If Tenant occupies the Leased Premises for less than a full Operating Year during the Building payable under Lease Term, the Ownership Agreement. (b) Premiums and other charges with respect to all insurance relating to Operating Expense Adjustment shall be prorated on a per-diem basis based upon the amount of time in such Operating Year that Tenant occupies the Leased Premises. If the Building is not fully occupied during any Operating Year during the Lease Term, and all improvements forming a part Tenant's Percentage of Building shall be recalculated for the Leased Premises, includ-ing, but not limited to, physical damage insurance; property loss or damage insurance; comprehensive public liability insurance; and the deductible amount with respect to all insurance coverage set forth above to the extent that payment is made under the policy to cover a casualty covered by the policy. (c) The cost purposes of providing electricity, water, sewer, air-conditioning and ventilation, and any and all other utility services, to the Leased Premises. (d) The cost incurred for operation, service, maintenance, inspection, repairs and alterations of (i) the Leased Premises, (ii) the security system of the Leased Premises; and (iii) the plumbing and electrical systems serving the Leased Premises; and the cost of labor, materials, supplies and equipment used in connection with all of the aforesaid items. (e) The cost of repainting or otherwise redecorating any part of the Leased Premises. (f) The cost of licenses, permits and similar fees and charges related to operation, repair and maintenance of the Leased Premises. (g) Reasonable management, accounting, and audit fees incurred in connection with the property management and the preparation and certification of Tax and determining Tenant's Operating Expense Statements Adjustment pursuant to this Section 6. (h) The Municipal License Tax 7, except that such recalculation shall only be for those expenses of the Municipality of Carolina, any income or gross receipts tax Operating expense that is limited to income from real property, miscellaneous taxes (other than Property Taxes) applicable to the Leased Premises. (i) All costs associated vary with the installation and maintenance of meters measuring the consumption of electricity and water for the Leased Premises. (iv) Notwithstanding the foregoing, "Operating Expense" shall not include expenditures for any occupancy of the following whether made directly by Building. For the Landlord or included purposes of said recalculation, the total rentable square feet in the Common Expenses paid by Building shall be deemed to equal the Landlord: average (acalculated on a month-by-month basis) The cost of any addition made to the Building, (except costs associated with the acquisition and installation or any energy or cost saving devices or costs incurred to comply with governmental requirements, whether federal, Commonwealth or municipal, or costs for repairs, replacements and improvements that are appropriate for the continued operation rentable area of the Building as a first-class office building or as set forth occupied during the applicable Operating Year. As used in subsection (iv)(e)(1) below)this Section 7.A., including the cost of preparing Building space for occupancy by a new tenant. (b) Repairs or other work occasioned by fire, hurricane, flooding, windstorm or other insured casualty or hazard, to the extent that Landlord shall receive proceeds of insurance therefore. (c) Leasing commissions following words and advertising expenses incurred in leasing or procuring new tenants. Table of Contents (d) Repairs or rebuilding necessitated by condemnation to the extent that Landlord has received condemnation proceeds for such repairs or rebuilding. (e) Depreciation and amortization of the Building or the Leased Premises, other than (1) capital expenditures that under GAAP are expenses or regarded as deferred expenses and (2) capital expenditures for energy or cost saving devices, or appropriate to a first class office building, or required by law as described in the exception to (iv)(a) above. (f) Franchise or income taxes imposed on Landlord. (g) The cost of any work or service performed for any tenant of the Building (other than Tenant) to a greater extent or to an immaterially more favorable manner than that furnished generally to the tenants and other occupants; and in no event shall Tenant pay for any tenant improvement for any other tenant. (h) The cost for any items for which Landlord is reimbursed by insurance, condemnation, refund, rebate or otherwise. (i) Interest and amortization on any mortgage or deed of trust and any rent paid on any ground or underlying lease. (j) Any cost representing an amount paid to an entity related to Landlord which is in excess of the amount which would have been paid in the absence of such relationship. (k) Any expenses for repairs or maintenance which are covered by warranties, guaranties and service contracts (excluding any mandatory deductible). (v) The Operating Expense terms shall be "net" and, for that purpose, shall be reduced by the amounts of any reimbursement received by Landlord with respect to extra air conditioning services provided to and charged to tenants.defined as hereinafter set forth:

Operating Expense. (i) Tenant shall pay to Landlord the Operating Expense Allowance in equal monthly installments, the first of which shall be payable upon execution of this Lease. If the term commences other than ont he first day of the calendar month, then the Operating expense Allowance for the first calendar month of the Term shall be adjusted to the succeeding month. Tenant's Proportionate Share of Operating Expense If Landlord's Operating Expense for any Operating Year shall be greater than the Operating Expense Allowance, Tenant shall pay to Landlord as part of Additional Rent for each Operating Year during the Lease Term additional rent an amount equal to Tenant's Proportionate Share of Landlordthe difference (the amount of Tenant's Proportionate Share of such difference is hereinafter referred to as the "Operating Expense Adjustment"). If Tenant occupies the Premises or portion thereof for less than a full Operating Year, the Operating Expense Adjustment will be calculated in proportion to the amount of time in such Operating Year ("Tenant's Operating Expense")that Tenant occupied the Premises. Tenant shall pay to Landlord as Such Additional Rent, Tenant's Operating Expense for each current Operating Year in equal monthly installments in the amount of one-twelfth (1/12) of Landlord's estimate of Tenant's Operating Expense for the current Operating Year based on (a) the Budget for the current Operating Year., or if such Budget shall not have been approved, on the actual Operating Expense for the Building for the Operating Year immediately preceding. (ii) Tenant's Operating Expense Rent shall be paid (or credited) in the following manner: (a) Beginning with the Commencement Date and continuing thereafter on the first day of each month until receipt of the Operating Expense Statement with respect to the Operating Year in which this Lease commences, Tenant shall pay Landlord in equal monthly installments in advance, concurrently with payments of Basic Rent, an amount equal to one-twelfth (1/12) of the Operating Expense Estimate as specified in Landlord's written notice of its Operating Expense Estimate. If the Commencement Date of this Lease is not the first day of a month, the Operating Expense Estimate payment corresponding to the month in which the Lease Term begins shall be prorated and paid for that portion of the month between the Commencement Date and the end of such month. (b) Within 180 calendar : within 120 days following the end of the first and each succeeding Operating Year, Landlord shall furnish Tenant an Operating Expense Statement, Statement certified as true and correct setting forth (i) the information described hereof under the definition of Operating Expense Statementfor the preceding Operating Year, (ii) the Operating Expense Allowance and (iii) Tenant's Operating Expense Adjustment for such Operating Year. Within fifteen (15) calendar 10 days following the receipt of such Operating Expense Statement (the "Expense Adjustment Date") Tenant shall pay to Landlord as Additional Rent: (1) the amount by which Tenant's Operating Expense for the Operating Year covered by Rent the Operating Expense Statement exceeds Adjustment for such Operating Year. Commencing with the aggregate first month of the second Operating Year, Tenant shall pay to Landlord, in addition to the Operating Expense Allowance, on account of the Operating Expense Estimate paid with respect to Adjustment for such Operating Year; and , monthly installments in advance equal to one-twelfth (21/12) of the amount by which the estimated Operating Expense Estimate as shown on the Operating Expense Statement Adjustment for the current such Operating Year, multiplied by the number of months elapsed . As used in the current Operating Year including the month in which payment is made, exceeds the amount of payments of the Operating Expense Estimate in the Operating Year in which the Operating Expense Statement is issued. (cthis Section 6(A) On the first day of the first month following receipt by Tenant of any annual Operating Expense Statement and continuing thereafter on the first day of each succeeding month until the issuance of the next ensuing Operating Expense Statement, Tenant shall pay Landlord, as Additional RentSection 1 where applicable, the amount of the Operating Expense Estimate shown on the Expense Statement in equal monthly installments. Table of Contents (iii) Operating Expense" shall include the following expenses incurred by Landlord in connection with the operation, repair, maintenance, protection words and management of the Building and the Lot: (a) The Landlord's share of common expenses ("Common Expenses") for the Building payable under the Ownership Agreement. (b) Premiums and other charges with respect to all insurance relating to the Leased Premises, and all improvements forming a part of the Leased Premises, includ-ing, but not limited to, physical damage insurance; property loss or damage insurance; comprehensive public liability insurance; and the deductible amount with respect to all insurance coverage set forth above to the extent that payment is made under the policy to cover a casualty covered by the policy. (c) The cost of providing electricity, water, sewer, air-conditioning and ventilation, and any and all other utility services, to the Leased Premises. (d) The cost incurred for operation, service, maintenance, inspection, repairs and alterations of (i) the Leased Premises, (ii) the security system of the Leased Premises; and (iii) the plumbing and electrical systems serving the Leased Premises; and the cost of labor, materials, supplies and equipment used in connection with all of the aforesaid items. (e) The cost of repainting or otherwise redecorating any part of the Leased Premises. (f) The cost of licenses, permits and similar fees and charges related to operation, repair and maintenance of the Leased Premises. (g) Reasonable management, accounting, and audit fees incurred in connection with the property management and the preparation and certification of Tax and Operating Expense Statements pursuant to this Section 6. (h) The Municipal License Tax of the Municipality of Carolina, any income or gross receipts tax that is limited to income from real property, miscellaneous taxes (other than Property Taxes) applicable to the Leased Premises. (i) All costs associated with the installation and maintenance of meters measuring the consumption of electricity and water for the Leased Premises. (iv) Notwithstanding the foregoing, "Operating Expense" shall not include expenditures for any of the following whether made directly by the Landlord or included in the Common Expenses paid by the Landlord: (a) The cost of any addition made to the Building, (except costs associated with the acquisition and installation or any energy or cost saving devices or costs incurred to comply with governmental requirements, whether federal, Commonwealth or municipal, or costs for repairs, replacements and improvements that are appropriate for the continued operation of the Building as a first-class office building or as set forth in subsection (iv)(e)(1) below), including the cost of preparing Building space for occupancy by a new tenant. (b) Repairs or other work occasioned by fire, hurricane, flooding, windstorm or other insured casualty or hazard, to the extent that Landlord shall receive proceeds of insurance therefore. (c) Leasing commissions and advertising expenses incurred in leasing or procuring new tenants. Table of Contents (d) Repairs or rebuilding necessitated by condemnation to the extent that Landlord has received condemnation proceeds for such repairs or rebuilding. (e) Depreciation and amortization of the Building or the Leased Premises, other than (1) capital expenditures that under GAAP are expenses or regarded as deferred expenses and (2) capital expenditures for energy or cost saving devices, or appropriate to a first class office building, or required by law as described in the exception to (iv)(a) above. (f) Franchise or income taxes imposed on Landlord. (g) The cost of any work or service performed for any tenant of the Building (other than Tenant) to a greater extent or to an immaterially more favorable manner than that furnished generally to the tenants and other occupants; and in no event shall Tenant pay for any tenant improvement for any other tenant. (h) The cost for any items for which Landlord is reimbursed by insurance, condemnation, refund, rebate or otherwise. (i) Interest and amortization on any mortgage or deed of trust and any rent paid on any ground or underlying lease. (j) Any cost representing an amount paid to an entity related to Landlord which is in excess of the amount which would have been paid in the absence of such relationship. (k) Any expenses for repairs or maintenance which are covered by warranties, guaranties and service contracts (excluding any mandatory deductible). (v) The Operating Expense terms shall be "net" and, for that purpose, shall be reduced by the amounts of any reimbursement received by Landlord with respect to extra air conditioning services provided to and charged to tenants.defined as hereinafter set forth:

Operating Expense. (i) Tenant shall pay to Landlord as part of Additional Rent for each Operating Year during the Lease Term an amount equal to Tenant's Proportionate Share of Operating Expense for each Operating Year. Commencing with the first month of the Lease Term, Tenant shall pay to Landlord's , on account of the Operating Expense for such Operating Year ("Tenant's Operating Expense"). Tenant shall pay to Landlord as Additional RentYear, Tenant's Operating Expense for each current Operating Year in equal monthly installments in the amount of one-twelfth (1/12) of Landlord's estimate of Tenant's Operating Expense for the current Operating Year based on (a) the Budget for the current Operating Year., or if such Budget shall not have been approved, on the actual Operating Expense for the Building for the Operating Year immediately preceding. (ii) Tenant's Operating Expense shall be paid (or credited) in the following manner: (a) Beginning with the Commencement Date and continuing thereafter on the first day of each month until receipt of the Operating Expense Statement with respect to the Operating Year in which this Lease commences, Tenant shall pay Landlord in equal monthly installments in advance, concurrently with payments of Basic Rent, an amount advance equal to one-twelfth (1/121/12th) of the Tenant's Operating Expense Estimate as specified in Landlord's written notice of its for such Operating Expense EstimateYear. If Tenant occupies the Commencement Date of this Lease is not the first day of Leased Premises or portion thereof for less than a monthfull Operating Year, the Operating Expense Estimate payment corresponding will be allocated proportionately to the month amount of time in which the Lease Term begins shall be prorated and paid for such Operating Year that portion of the month between the Commencement Date and the end of Tenant so occupies such month. space. Within one hundred twenty (b120) Within 180 calendar days following the end of each Operating Year, Landlord shall furnish Tenant an Operating Expense Statement, Statement setting forth (i) the information described hereof under Operating Expense for the definition preceding Operating Year, (ii) Tenant's Proportionate Share, (iii) the Operating Expense Estimate paid by Tenant, and (iv) the amount overpaid or underpaid by Tenant on account of Operating Expense Statementfor such Operating Year (referred to herein as the "Operating Expense Adjustment"). Within fifteen (15) calendar days following the receipt of such Operating Expense Statement (the "Expense Adjustment Date") Tenant shall pay to Landlord as Additional Rent: Rent any underpaid Operating Expense Adjustment for such Operating Year, or Landlord shall credit any overpaid Operating Expense Adjustment against the next installments of Annual Fixed Rent and Operating Expense Estimates becoming due under this Lease. The Operating Expense Statement shall also set forth a revised Operating Expense Estimate for the then current Operating Year (1) which revised estimate shall be based on the amount by which Tenant's actual Operating Expense for the preceding Operating Year covered Year, adjusted by reasonable changes, such as changes in taxes or service contracts known to Landlord as of the Operating Expense Statement exceeds date of the aggregate issuance of the Operating Expense Estimate paid with respect to such Operating Year; and (2) the amount by which the Statement). The new Operating Expense Estimate as shown on the Operating Expense Statement for the current Operating Year, multiplied by the number of months elapsed in the current Operating Year including the month in which payment is made, exceeds the amount of payments of the Operating Expense Estimate in the Operating Year in which the Operating Expense Statement is issued. (c) On shall be retroactive to the first day of the first month following receipt by Tenant of any annual then current Operating Expense Statement and continuing thereafter on the first day of each succeeding month until the issuance of the next ensuing Operating Expense Statement, Tenant shall pay Landlord, as Additional Rent, the amount of the Operating Expense Estimate shown on the Expense Statement in equal monthly installments. Table of Contents (iii) Operating Expense" shall include the following expenses incurred by Landlord in connection with the operation, repair, maintenance, protection and management of the Building and the Lot: (a) The Landlord's share of common expenses ("Common Expenses") for the Building payable under the Ownership Agreement. (b) Premiums and other charges with respect to all insurance relating to the Leased Premises, and all improvements forming a part of the Leased Premises, includ-ing, but not limited to, physical damage insurance; property loss or damage insurance; comprehensive public liability insurance; and the deductible amount with respect to all insurance coverage set forth above to the extent that payment is made under the policy to cover a casualty covered by the policy. (c) The cost of providing electricity, water, sewer, air-conditioning and ventilationYear, and any credits or adjustments shall be handled in the same manner as overpayments and all other utility services, to underpayments for the Leased Premises. (d) The cost incurred for operation, service, maintenance, inspection, repairs and alterations of (i) the Leased Premises, (ii) the security system of the Leased Premises; and (iii) the plumbing and electrical systems serving the Leased Premises; and the cost of labor, materials, supplies and equipment preceding Operating Year. As used in connection with all of the aforesaid items. (e) The cost of repainting or otherwise redecorating any part of the Leased Premises. (f) The cost of licenses, permits and similar fees and charges related to operation, repair and maintenance of the Leased Premises. (g) Reasonable management, accounting, and audit fees incurred in connection with the property management and the preparation and certification of Tax and Operating Expense Statements pursuant to this Section 6. (h) The Municipal License Tax of the Municipality of Carolina6 and Section 1 where applicable, any income or gross receipts tax that is limited to income from real property, miscellaneous taxes (other than Property Taxes) applicable to the Leased Premises. (i) All costs associated with the installation and maintenance of meters measuring the consumption of electricity and water for the Leased Premises. (iv) Notwithstanding the foregoing, "Operating Expense" shall not include expenditures for any of the following whether made directly by the Landlord or included in the Common Expenses paid by the Landlord: (a) The cost of any addition made to the Building, (except costs associated with the acquisition words and installation or any energy or cost saving devices or costs incurred to comply with governmental requirements, whether federal, Commonwealth or municipal, or costs for repairs, replacements and improvements that are appropriate for the continued operation of the Building as a first-class office building or as set forth in subsection (iv)(e)(1) below), including the cost of preparing Building space for occupancy by a new tenant. (b) Repairs or other work occasioned by fire, hurricane, flooding, windstorm or other insured casualty or hazard, to the extent that Landlord shall receive proceeds of insurance therefore. (c) Leasing commissions and advertising expenses incurred in leasing or procuring new tenants. Table of Contents (d) Repairs or rebuilding necessitated by condemnation to the extent that Landlord has received condemnation proceeds for such repairs or rebuilding. (e) Depreciation and amortization of the Building or the Leased Premises, other than (1) capital expenditures that under GAAP are expenses or regarded as deferred expenses and (2) capital expenditures for energy or cost saving devices, or appropriate to a first class office building, or required by law as described in the exception to (iv)(a) above. (f) Franchise or income taxes imposed on Landlord. (g) The cost of any work or service performed for any tenant of the Building (other than Tenant) to a greater extent or to an immaterially more favorable manner than that furnished generally to the tenants and other occupants; and in no event shall Tenant pay for any tenant improvement for any other tenant. (h) The cost for any items for which Landlord is reimbursed by insurance, condemnation, refund, rebate or otherwise. (i) Interest and amortization on any mortgage or deed of trust and any rent paid on any ground or underlying lease. (j) Any cost representing an amount paid to an entity related to Landlord which is in excess of the amount which would have been paid in the absence of such relationship. (k) Any expenses for repairs or maintenance which are covered by warranties, guaranties and service contracts (excluding any mandatory deductible). (v) The Operating Expense terms shall be "net" and, for that purpose, shall be reduced by the amounts of any reimbursement received by Landlord with respect to extra air conditioning services provided to and charged to tenants.defined as hereinafter set forth: