Common use of Operating Cost Adjustment Clause in Contracts

Operating Cost Adjustment. (a) If in any calendar year the Operating Cost is greater than the Estimated Operating Cost, Tenant shall pay to Landlord as additional rent an amount equal to such excess. Any amount payable by Tenant to Landlord under this Section 6 shall be paid within thirty (30) days after written notice thereof by Landlord, such notice to be given by Landlord not later than March 31 of each calendar year. Landlord may, either prior to the beginning of or during any calendar year, compute a bona fide estimate of Operating Cost for such calendar year. Upon receipt of written notice thereof, Tenant shall pay to Landlord, in monthly installments simultaneously with payments of Base Rent under Section 4(a), one-twelfth of such new estimate of Operating Cost. An annual adjustment shall be made between the parties within thirty (30) days after Landlord's determination of Operating Cost. Any amounts of excess estimated Operating Cost which Landlord is required to return may be offset by accrued amounts payable by Tenant to Landlord. If the term of this Lease ends before the end of a calendar year, any amount payable by Tenant or Landlord in respect of that year under this Section 6 shall be adjusted proportionately on a daily basis utilizing the previous year's determination of Operating Costs and the obligation to pay such amount shall survive the expiration or earlier termination of this Lease. (b) As used in this Lease, "Operating Cost" means an amount per calendar year (projected to an annual figure for the calendar year in which the Premises is first occupied) which represents the actual Operating Cost for any calendar year during the Term of this Lease. The Operating Cost shall be determined by Landlord and shall be equal to the sum of the items of cost listed in Section 6(b)(i) and Section 6(b)(ii) but not the items listed in Section 6(b)(iii) in respect of a calendar year:

Operating Cost Adjustment. (a) If in any calendar year the Operating Cost is greater than the Estimated Base Operating Cost, Tenant shall pay to Landlord as additional rent an amount equal to such excessexcess multiplied by the Premises Rentable Area. Any amount payable by Tenant to Landlord under this Section 6 shall be paid within thirty (30) days after written notice thereof by Landlord, such notice to be given by Landlord not later than March 31 of each calendar year. Landlord may, either prior to the beginning of or during any calendar year, compute a bona fide estimate of Operating Cost for such calendar year. Upon receipt of written notice thereof, Tenant shall pay to Landlord, in monthly installments simultaneously with payments of Base Rent under Section 4(a), one-twelfth of the product of such new estimate of estimated Operating CostCost and the Premises Rentable Area. An annual adjustment shall be made between the parties within thirty (30) days after Landlord's ’s determination of Operating Cost. Any amounts of excess estimated Operating Cost which Landlord is required to return may be offset by accrued amounts payable by Tenant to Landlord. If the term Term of this Lease ends before the end of a calendar year, any amount payable by Tenant or Landlord in respect of that year under this Section 6 shall be adjusted proportionately on a daily basis utilizing the previous year's ’s determination of Operating Costs and the obligation to pay such amount shall survive the expiration or earlier termination of this Lease. In no event shall Landlord be required to make any payment or refund to Tenant if in any calendar year the Operating Cost is less than the Base Operating Cost. (b) As used in this Lease, "“Operating Cost" ” means an amount per square foot of Building Rentable Area per calendar year determined as set forth below (projected to an annual figure for the calendar year in which the Premises Building is first occupied) ), which represents the actual Operating Cost for any calendar year during the Term of this Lease. The Operating Cost (calculated to the nearest cent) shall be determined by Landlord and shall be equal to the sum of the items of cost listed in Section 6(b)(i) and Section 6(b)(ii) but not the items listed in Section 6(b)(iii) following in respect of a calendar yearyear divided by the Building Rentable Area:

Operating Cost Adjustment. (a) If in any calendar year during the Lease Term the Operating Cost is greater than the Estimated Base Operating Cost, Tenant shall pay to Landlord as additional rent an amount equal to such excessexcess multiplied by the Building Area. Any amount payable by Tenant to Landlord under this Section 6 shall be paid within thirty (30) days after written notice thereof by Landlord, such notice to be given by Landlord not later than March 31 of each calendar year. Landlord may, either prior to the beginning of or during any calendar year, compute a bona fide new estimate of Operating Cost for such calendar year. Upon receipt of written notice thereof, Tenant shall pay to Landlord, in monthly installments simultaneously with payments of Base Rent under Section 4(a), one-twelfth of such new estimate of estimated Operating CostCost times the Building Area. An annual adjustment shall be made between the parties within thirty (30) days after Landlord's ’s determination of Operating Cost. Any amounts of excess estimated Operating Cost which Landlord is required to return may be offset by accrued amounts payable by Tenant to Landlord. If the term Term of this Lease ends before the end of a calendar year, any amount payable by Tenant or Landlord in respect of that year under this Section 6 shall be adjusted proportionately on a daily basis utilizing the previous termination year's ’s determination of Operating Costs and the obligation to pay such amount shall survive the expiration or earlier termination of this Lease. (b) As used in this Lease, "“Operating Cost" ” means an amount per square foot of Building Area per calendar year (projected to an annual figure for the calendar year in which the Premises is first occupiedRent Commencement Date occurs) which represents the actual Operating Cost for any calendar year during the Term of this Lease. The Operating Cost shall be determined by Landlord and shall be equal to the sum of the items of cost listed in Section 6(b)(i) and Section 6(b)(ii) but not the items listed in Section 6(b)(iii) in respect of a calendar year: (i) All general and special real estate taxes, special assessments for improvements, special district or improvement district assessments, water charges, sewer charges, vault charges and other ad valorem taxes, rates, levies and assessments payable in respect of the Term upon or in respect of the Premises to any governmental or quasi-governmental authority and all taxes specifically imposed in lieu of any such taxes, but excluding any inheritance, estate, succession, transfer, gift, franchise, corporation, income, rental or profit tax or capital levy imposed on Landlord (“Taxes”). If due to a future change in the method of taxation, any franchise, income, profit or other tax shall be levied against Landlord in whole or in part in lieu of any tax which would otherwise constitute one of the foregoing taxes or charges or if there shall be levied against Landlord a tax or license fee measured by gross rents, such franchise, income, profit or other tax or license fee shall be deemed to be a real estate tax for the purposes hereof. The Taxes described in this Section 6(b)(i) shall also include all of Landlord’s expenses, including, but not limited to, attorney’s fees, incurred by Landlord in any effort to minimize such taxes, whether by contesting proposed increases in assessments or by any other means or procedures appropriate in the circumstances. Landlord will commence appropriate actions to contest any increased valuation of the Premises upon Tenant’s written request therefore. If Landlord secures an abatement or refund of any Taxes, Landlord shall pass such abatement through the Tenant as a credit to be applied against rent next becoming due, or if no further rent is due by Tenant, by cash payment from Landlord to Tenant. (ii) Except as otherwise set forth in this Lease, all costs, charges and expenses (not directly reimbursed by insurance proceeds) which are attributable to the ownership, operation, maintenance, replacement (including HVAC, Parking Lot, and roof replacements), and repair of the Premises, building supplies, services, maintenance, replacement, and repair of the Premises, insurance (including boiler and machinery, loss of rent, accidental and direct physical loss, all risk, and public liability insurance as provided in Section 20), reasonable management fees, and labor costs incurred in the operation or maintenance of the Premises. Except as provided in Section 6(a)(iii), and except for repairs and replacements for which Landlord is reimbursed from insurance proceeds, all repairs and replacements shall either be made by Tenant directly or shall be made by Landlord at Tenant’s expense as an Operating Cost. (iii) The following expenses and costs shall not be included within the “Operating Costs” for the Premises: depreciation, interest and principal payments on mortgages and other debt costs, if any; costs for which the Landlord is reimbursed by insurance proceeds; costs associated with the operation of the business of the Landlord as a separate entity, as the same are distinguished from the cost of operating the Premises; penalties and interest; tax penalties incurred as a result of the Landlord’s negligence, inability, or unwillingness to make payments when due; Landlord’s general overhead and general administrative expenses; and capital structural repairs and replacements of structural portions of the Premises. For purposes of this Lease, “structural portions” of the Premises shall mean the foundation, supporting members of the roof, exterior walls, structural girders and columns, and load-bearing walls. (c) Tenant or Tenant’s legal or financial counsel shall have the right to inspect all documents and Landlord’s books and records reflecting any part of the Operating Costs and the calculations of any amount payable under Section 6(a) of this Lease, and Landlord shall provide written receipts and accounting records supporting its itemized statements and calculations of Operating Costs and the amounts due under Section 6(a) once each year upon request by Tenant. If Tenant wishes to dispute the determination of Operating Costs under Section 6(a) or the calculation of any amount payable under Section 6(a), Tenant shall give Landlord written notice of such dispute within sixty (60) days after receipt of notice from Landlord of the matter giving rise to the dispute. If Tenant does not provide Landlord such notice within such time, Tenant shall have waived its right to dispute such determination or calculation. Promptly after the giving of such written notice, Landlord shall cause to be made a complete audit of Landlord’s records relating to the matter in dispute by an independent certified public accountant selected by Landlord and approved by Tenant, Tenant’s approval not to be unreasonably withheld. The cost of such audit shall be borne by Tenant unless such audit discloses an error which overstated Operating Cost by more than two percent (2%) of the amount determined by the audit, in which event Landlord shall bear the cost of such audit. If such audit reveals that the amount previously determined by Landlord was incorrect, a correction shall be made and either Landlord shall promptly return to Tenant any overpayment or Tenant shall promptly pay to Landlord any underpayment which was based on such incorrect amount. Notwithstanding the pendency of any dispute hereunder, Tenant shall make payments based upon Landlord’s determination or calculation until such determination or calculation has been established hereunder to be incorrect.