1. DEFINITIONS
Unless the context otherwise specifies or requires, the following
terms shall have the meanings herein specified:
(a) "Building" shall mean the building designated in
Item 4 of the Term Sheet and the land and other real property
in the parcel more particularly described on Exhibit "A"
hereto, and all other improvements on or appurtenances to said
parcel.
(b) "Business Day" shall mean Monday through Friday,
but excludes the following holidays or the days on which the holidays
are designated for observance: New Year's Day, Memorial Day, Independence
Day, Labor Day, President's Day, Thanksgiving Day and Christmas
Day.
(c) "Business Hours" shall be the hours designated in
Item 5 of the Term Sheet.
(d) "Calendar Year" shall mean any period during the
Initial Term or any Extended Term of this Lease commencing on
January 1 and ending on the next following December 31.
(e) "Common Areas" shall include all interior and exterior
common areas, including, but not limited to, parking areas, driveways,
building signs, landscaping, paving, sidewalks, hallways, stairways,
escalators, elevators, common entrances, lobbies, rest rooms and
other similar public areas and access ways.
(f) "Lease" shall include this Lease Agreement, the
Term Sheet, Landlord's Worksheet, Exhibits A, B, C, D, E and F
and all other Exhibits, if any, specified in Item 6 of the Term
Sheet. Initials: Landlord __________ Tenant ________________
(g) "Operating Expenses" shall mean any and all costs,
expenses and disbursements of every kind and character that are
reasonable, actual and necessary (subject to the limitations set
forth below) which Landlord shall incur, pay or become obligated
to pay at competitive prices in connection with the ownership
of any estate or interest in the Building or the operation, maintenance,
repair, replacement and security of the Building, including a
management fee as specified in Item 7 of the Term Sheet, all as
determined in accordance with generally accepted accounting principles
consistently applied.
- Operating Expenses shall not include Property Taxes as defined
in Section 1(i); depreciation of the Building; expenses performed
as a special service for another tenant that are not standard
for all tenants; advertising, public relations and promotions
attributable to Landlord's efforts to increase or maintain the
occupancy rate in the Building; tenants' improvements; utility
expenses provided to the Premises and separately metered and paid
directly by Tenant; legal and other expenses in enforcing the
terms of any lease or incurred with respect to negotiations or
disputes with present or prospective tenants or occupants of the
Building; real estate brokers' commissions' (unless specifically
agreed otherwise herein); salaries or other compensation due any
employee above the grade of building manager; state, federal or
local income taxes, excess profits or franchise taxes or other
such taxes imposed on or measured by or determined from the gross
income of Landlord; any ground lease rental; interest on debt
or amortization payments on mortgages or deeds of trust or any
other debt for borrowed money whether secured or unsecured; repairs
or other work needed because of fire, windstorm, or other casualty
or cause insured against by Landlord or to the extent Landlord's
insurance required under Section 17 would have provided insurance,
whichever is the greater coverage; nonrecurring costs incurred
to remedy structural defects in original construction materials
or installations; any costs, fines or penalties incurred because
Landlord violated any governmental rule or authority; costs incurred
to test, survey, cleanup, contain, abate, remove or otherwise
remedy hazardous wastes or asbestos-containing materials from
the Building or Premises unless the wastes or asbestos-containing
materials were in or on the Building or Premises because of Tenant's
negligence or intentional acts; overhead and profit paid to Landlord
or affiliates of Landlord for services rendered to the extent
the same exceeds the costs of such services rendered by unaffiliated
third parties on a competitive basis; all costs of a capital nature
under generally accepted accounting principles consistently applied,
including but not limited to: (i) rentals and other related expenses
incurred in leasing capital items such as air conditioning systems,
elevators or other equipment that would not be considered normal
maintenance, repair, management or operation expenses; (ii) extraordinary
alterations to and replacements of capital items; (iii) costs
of equipment, tools and/or improvements not normally expensed
in one year; and (iv) expenditures for compliance with governmental
requirements in effect prior to occupancy of the Building; costs
incurred by Landlord with respect to goods and services (including
utilities sold and supplied to tenants and occupants of the Building)
to the extent that Landlord is entitled to reimbursements for
such costs; any compensation paid to clerks, attendants or other
persons in commercial concessions operated by Landlord or in the
parking garage of the Building. If less than ninety-five Percent
(95%) of the rentable square footage in the Building shall have
been occupied by tenants at the time the Base Year Operating Expenses
are determined or any adjustment period thereafter, Operating
Expenses shall be "grossed up" to the amount of Operating
Expenses that, using reasonable projections, it would normally
be expected to be incurred during the Base Year or any adjustment
period thereafter assuming the total rentable square footage in
the Building were occupied during the Base Year or any adjustment
period thereafter, as determined under generally accepted accounting
principles consistently applied. Only those component expenses
that are affected by variations in occupancy levels shall be so
adjusted.
- Notwithstanding the foregoing, Operating Expenses may include
the cost of any capital improvements (i) which are made for the
primary purpose of reducing Operating Expenses, or (ii) which
may be required by governmental authority under any governmental
law or regulation that was not applicable to the Building as of
the date of this Lease, which cost shall be amortized over the
period used by Landlord for Federal Income Tax purposes, together
with interest on the unamortized balance at the rate equal to
the Prime Rate published in the Wall Street Journal or such higher
rate as may have been paid by Landlord on funds borrowed for the
purpose of constructing such capital improvements.
- The Base Year for Operating Expense purposes, the total dollar
amount of Base Operating Expenses and Tenant's Percentage Share
of same are designated in Item 7 of the Term Sheet.
(h) "Premises" shall mean the portion of the Building
located on the floor(s) specified in Item 8 of the Term Sheet
which is outlined on the floor plan(s) attached hereto as Exhibit
"B." The Premises contain the fixtures, improvements
and other property now installed plus any improvements described
in Section 3(b) and Landlord's Worksheet.
(i) "Property Taxes" shall mean the total of all ad
valorem real property taxes and currently due installments of
assessments, special or otherwise, levied upon, or with respect
to or reasonably allocable to the Building or the rent and additional
charges payable thereunder, imposed by any taxing authority having
jurisdiction. With respect to the payment of assessments, special
or otherwise, payment in installments over the longest possible
term shall be deemed to have been elected in any instance where
a determinable option so to pay existed, or may exist, notwithstanding
that an assessment may have been, or may hereafter be, paid infull, and Tenant shall bear its pro rata share of only such installments
plus applicable interest on the outstanding principal balance
from time to time as would have become due, payable and delinquent
during the Initial Term or any applicable Extended Term had the
installment option been elected. Property Taxes also shall include
all taxes, levies and charges which may be assessed, levied or
imposed in replacement of or in addition to all or any part of
ad valorem real property taxes as revenue sources, and which in
whole or in part are measured or calculated by, based upon or
allocable to the Building, the leasehold estate of Landlord or
Tenant or the rent and other charges payable thereunder.
- Notwithstanding the foregoing, Property Taxes shall not include
federal, state or local income taxes; franchise, gift, transfer,
excise, capital stock, estate, succession or inheritance taxes;
penalties or interest for late payment of Property Taxes.
- The Base Year for Property Tax purposes, the total dollar amount
of Base Property Taxes and Tenant's Percentage Share of same are
designated in Item 9 of the Term Sheet.
(j) "Tenant's Percentage Share" shall mean the percentage
figure specified in Item 10 of the Term Sheet which is equal to
the rentable square footage of the Premises as specified in Item
11 of the Term Sheet divided by the rentable square footage of
the Building, and expressing the fraction as a percentage.
(k) "Term Sheet" shall mean the terms set forth in the
foregoing paragraphs delineated as "Term Sheet," which
terms are hereby incorporated in this Lease as if set forth in
full. In the event of any conflict between any provision of the
Term Sheet and this Lease, the latter shall control.
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