Base Year Sample Clauses

The Base Year clause establishes a specific year as the reference point for calculating changes in costs, expenses, or other financial metrics over time within a contract. Typically, this clause is used in agreements involving rent escalations, service charges, or cost adjustments, where future payments are compared to the amounts incurred or paid during the base year. For example, in a commercial lease, the base year might be the first year of the lease term, and subsequent increases in operating expenses are measured against the costs from that year. The core function of the Base Year clause is to provide a clear and consistent benchmark, ensuring fairness and predictability in how future adjustments are calculated.