Common use of Operating Expense Clause in Contracts

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 Additional Rent an amount equal to Tenant's Proportionate Share (as defined below) of the 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 that Tenant so occupies such space. Such additional Rent shall be paid in the following manner: within one hundred twenty (120) days following the end of each Operating Year, Landlord shall furnish Tenant an Operating Expense Statement setting forth (i) the Operating Expense for the preceding Operating Year, (ii) the Operating Expense Allowance and (iii) the Tenant's Operating Expense Adjustment for such Operating Year. Within fifteen (15) days following the receipt of such Operating Expense Statement (the "Expense Adjustment Date") Tenant shall pay to Landlord as Additional Rent the Operating Expense Adjustment for such Operating Year. Commencing with the first month of the Lease Term, Tenant shall pay to Landlord, on account of the Operating Expense Adjustment for such Operating Year, monthly installments in advance equal to one-twelfth (1/12th) o the estimated Operating Expense Adjustment for such Operating Year. ON the next succeeding Expense Adjustment Date, Tenant shall pay to 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 following words and terms shall be defined as hereinafter set forth:

Operating Expense. If Landlord's Operating Expense for any Operating Year shall be greater than Subject to the Operating Expense Allowanceterms of the second following sentence, Tenant shall pay to Landlord Landlord, as Additional Rent hereunder, an amount equal to Tenant's Proportionate Share Percentage of Building, as set forth in Section 1(e), of all operating, maintenance, management, and repair expenses incurred by Landlord in connection with the ownership and operation of the Building, the Lot and the Premises for any "Operating Year" (as defined below) of ), including without limitation the difference 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 amount of Tenant's Proportionate Share Percentage of Building of such difference expenses is hereinafter referred to as the "Operating Expense Adjustment"). ." If Tenant occupies the Leased Premises or portion thereof for less than a full Operating YearYear during the Lease Term, the Operating Expense Adjustment will shall be allocated proportionally to prorated on a per-diem basis based upon the amount of time in such Operating Year that Tenant so occupies such spacethe Leased Premises. Such additional Rent If the Building is not fully occupied during any Operating Year during the Lease Term, Tenant's Percentage of Building shall be paid in the following manner: within one hundred twenty (120) days following the end of each Operating Year, Landlord shall furnish Tenant an Operating Expense Statement setting forth (i) the Operating Expense recalculated for the preceding Operating Year, (ii) the Operating Expense Allowance and (iii) the purposes of determining Tenant's Operating Expense Adjustment pursuant to this Section 7, except that such recalculation shall only be for such Operating Year. Within fifteen (15) days following the receipt of such Operating Expense Statement (the "Expense Adjustment Date") Tenant shall pay to Landlord as Additional Rent the Operating Expense Adjustment for such Operating Year. Commencing with the first month of the Lease Term, Tenant shall pay to Landlord, on account those expenses of the Operating Expense Adjustment for such Operating Year, monthly installments in advance equal to one-twelfth (1/12th) o expense that vary with the estimated Operating Expense Adjustment for such Operating Year. ON the next succeeding Expense Adjustment Date, Tenant shall pay to Landlord (or Landlord shall credit to Tenant) any deficiency (or excess) between the installments paid on account occupancy of the preceding year's Operating Expense Adjustment and Building. For the actual Operating Expense Adjustment for such purposes of said recalculation, the total rentable square feet in the Building shall be deemed to equal the average (calculated on a month-by-month basis) of the rentable area of the Building occupied during the applicable Operating Year. As used in this Section 6 and Section 1 where applicable7.A., the following words and terms shall be defined as hereinafter set forth:

Operating Expense. If Landlord's Operating Expense for any Operating Year shall be greater than the Operating Expense Allowance, (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 defined belowAdditional 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 difference (the amount of Tenant's Proportionate Share of such difference is hereinafter referred to as the "Operating Expense Adjustment")Estimate as specified in Landlord's written notice of its Operating Expense Estimate. If Tenant occupies the Leased Premises or portion thereof for less than full Operating YearCommencement Date of this Lease is not the first day of a month, the Operating Expense Adjustment will be allocated proportionally Estimate payment corresponding to the amount of time month in such Operating Year that Tenant so occupies such space. Such additional Rent which the Lease Term begins shall be prorated and paid in for that portion of the following manner: within one hundred twenty month between the Commencement Date and the end of such month. (120b) 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 for the preceding Operating Year, (ii) the Operating Expense Allowance and (iii) the Tenant's Operating Expense Adjustment for such Operating YearStatement. 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: (1) the amount by which Tenant's Operating Expense for the Operating Year covered by the Operating Expense Adjustment for Statement exceeds the aggregate of the Operating Expense Estimate paid with respect to such Operating Year. Commencing with ; 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 Lease Termnext ensuing Operating Expense Statement, Tenant shall pay to Landlord, on account as Additional Rent, the amount of the Operating Expense Adjustment 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 Operating Yearrepairs or rebuilding. (e) Depreciation and amortization of the Building or the Leased Premises, monthly installments 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 advance equal the exception to one-twelfth (1/12thiv)(a) o above. (f) Franchise or income taxes imposed on Landlord. (g) The cost of any work or service performed for any tenant of the estimated 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 Adjustment for such Operating Year. ON the next succeeding Expense Adjustment Date, Tenant shall pay to 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 following words and terms shall be defined as hereinafter set forth:"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.