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5. RENT - INITIAL TERM


(a) Tenant shall pay to Landlord throughout the Initial Term of this Lease as rental for the Premises the Base Rent specified in Item 16 of the Term Sheet. In addition to the Base Rent, Tenant shall pay monthly to Landlord on the same due date as the Base Rent commencing on the first anniversary of the Term Commencement Date (i) an amount equal to the product obtained by multiplying Tenant's Percentage Share times the remainder obtained by subtracting the Base Operating Expenses specified in Item 7 of the Term Sheet from the Operating Expenses for the Calendar Year in questions and (ii) an amount equal to the product obtained by multiplying Tenant's Percentage Share times the remainder obtained by subtracting the Base Property Taxes specified in Item 9 of the Term Sheet from the Property Taxes for the Calendar Year in question. Such Base Rent, and Tenant's Percentage Share of increased Operating Expenses and Property Taxes shall herein collectively be referred to as "Rent".

(b) The adjustments to the annual Rent amount contemplated under paragraph (a) above shall be made in accordance with the following procedures:

(i) Forty-five (45) days prior to the end of each Calendar Year, Landlord shall give Tenant notice of its reasonable estimate of the amounts payable under paragraph (a) above for the ensuing Calendar Year. on or before the first day of the month following completion of the first twelve months of the Initial Term and thereafter on or before the first day of each month during the ensuing Calendar Year, Tenant shall pay to Landlord one-twelfth (1/12th) of such estimated amounts; provided, however, that if notice of Landlord's estimate of Tenant's Percentage Share of Operating Expenses and Property Taxes is not given at least twenty (20) days prior to the end of such Calendar Year, during the next Calendar Year, Tenant shall continue to pay the monthly payment based on the Tenant's Percentage Share of Operating Expenses and Property Taxes computed for the previous Calendar Year until the second month after such notice is given.

(ii) Within one hundred twenty (120) days after the close of each Calendar Year subsequent to the first twelve months of the Initial term of this Lease, Landlord shall deliver to Tenant a statement of the adjustments to be made pursuant to paragraph (a) above for the preceding Calendar Year prepared by Landlord. No adjustment shall be made with respect to the first twelve months of the Initial Term of the Lease. Landlord shall include in this statement a reasonably detailed description of the Operating Expenses and Property Taxes and a description of how the Operating Expenses were grossed up, if applicable. In the event Landlord fails to deliver to tenant such statement within one hundred twenty (120) days after the close of each Calendar Year, Landlord shall be precluded from recovering any shortage from Tenant. If, on the basis of such statement, Tenant owes an amount that is less than the estimated payments for such Calendar Year previously made by Tenant, Landlord shall, at Tenant's option, either pay to Tenant the entire amount of such excess amount within thirty (30) days from the date of delivery of the statement or credit such excess to Tenant's next monthly payment of Rent or, if applicable, Extended Term Rent. If, on the basis of such statement, Tenant owes an amount that is more than the estimated payments for such Calendar Year previously made by Tenant, Tenant shall pay the deficiency to Landlord within thirty (30) days after delivery of the statement.

(iii) If this Lease shall commence on a day other than the first day of a Calendar Year or terminate a day other than the last day of a Calendar Year, the amount of adjustment to be made pursuant to paragraph (a) above that is applicable to the Calendar Year in which such commencement or termination shall occur shall be prorated on the basis of the number of calendar days within such year as are within the Initial Term or any applicable Extended Term of this Lease. Tenant's liability for Tenant's Proportionate Share of Operating Expenses and Property Taxes for the last Calendar Year falling entirely or partly within the Initial Term or any applicable Extended Term of this Lease shall survive the expiration of the Initial Term or any applicable Extended Term of this Lease. Similarly, Landlord's obligation to refund to Tenant excess Operating Expenses and Property Taxes, if any, paid by Tenant to Landlord shall survive the expiration of the Initial Term or any applicable Extended Term of this Lease.

(iv) Operating Expenses shall be reduced by reimbursements, credits, discounts, reductions or other allowances received or receivable by Landlord for items of cost included in Operating Expenses, except reimbursements to the Landlord by tenants under additional rent provisions.

(v) Landlord shall use reasonable efforts to keep Operating Expenses at reasonable amounts, while maintaining a first class office building.

(vi) Any costs incurred by Landlord because of a change of policy or practice in operating the Building or Premises that causes an increase in Operating Expenses over Base Operating Expenses shall be included as Operating Expenses only if the change in policy or practice would have been made by reasonably prudent operators of comparable office buildings in the area where the Leased Premises are located.

(vii) In determining the amount of any increases in Property Taxes after the first Calendar Year of the Lease, the Base Year and Base Property Taxes shall be as specified in Item 9 of the Term Sheet provided that in that Base Year there is an assessment based upon a fully completed Building, otherwise the Base Year shall be the first year thereafter in which there is an assessment based upon a fully completed Building.

(viii) Landlord agrees to provide Tenant with notice of increases greater than ten percent in the amount of Property Taxes due with respect to the Premises. Landlord shall so notify Tenant within thirty (30) days after its receipt of any such notice.

(ix) If the tenant occupies more than 50% of the buildings total rentable area, Landlord agrees to arrange with proper tax officials an initial meeting, and, upon written request of Tenant, meetings thereafter throughout the Initial Term, and if applicable, any Extended Term of this Lease, for the purposes of negotiating the first, and any subsequent, Property Tax assessment against the Premises, and that it shall extend to Tenant a timely opportunity to participate in all such negotiations. Landlord agrees that it shall not negotiate any assessment, nor concur therein, unless Tenant has participated as aforesaid, or has declined in writing to do so.

(x) If the Tenant occupies more than 50% of the building's total rentable area, tenant or its designee shall have the unrestricted right in its name, or in the name of Landlord if required, to pursue such administrative and judicial procedures as may be necessary to contest and appear from any assessment or valuation, and pay under protest any billing of Property Taxes all or part of which are borne by Tenant under the terms of this Lease. Landlord agrees to cooperate in all reasonable ways to further any such procedure by Tenant.

(xi) Any increase in the amount of Property Taxes specifically attributed and allocated to any improvements or additions made by other tenants to the Building shall not be included in determining Tenant's share of Property Taxes. If Tenant performs improvements which Increase Property Taxes, then Tenant shall reimburse Landlord for any such increase in Property Taxes.

(xii) If Landlord receives a refund of any portion of Property Taxes that were included in the Initial Term Rent, or any applicable Extended Term Rent, then Landlord shall, at Tenant's option, either pay to Tenant its pro rata share of such refund within thirty (30) days from its receipt of same or credit Tenant's pro rata share of such refund to Tenant's next monthly payment of Rent or, if applicable, Extended Term Rent, less any expenses that Landlord reasonably incurred to obtain the refund.

(xiii) Landlord hereby agrees that the calculation of Additional Rent under this Article 5 shall be made in a fair and reasonable manner consistent with calculations of rent for other tenants in the Building.

(xiv) If Landlord increases the Building's rentable square feet after the Building was fully assessed as a completed and occupied unit and the Lease was signed, then the Operating Expenses and Property Taxes attributable to the additional rentable square feet shall be included in the Operating Expenses and Property Taxes in an amount per rentable square foot not to exceed the rentable square foot cost of Operating Expenses and Property Taxes of the original Building. But Tenant's Percentage Share shall be reduced using the same formula described in Section 1(j).

(xv) Upon at least three (3) business days' notice to Landlord, Tenant shall be entitled to examine Landlord's books and records within forty-five (45) days after Tenant's receipt of Landlord's statement under subparagraph(ii) above. Unless Tenant takes written exception to any item in Landlord's statement within sixty (60) days after the furnishing of the statement, such statement shall be considered as final and accepted by Tenant. Any amount due Landlord as shown on any such statement shall be paid by tenant within thirty (30) days after it is furnished to Tenant. If Tenant shall dispute in writing any specific item or items in Landlord's statement of Operating Expenses and Property Taxes, and such dispute is not resolved between Landlord and Tenant within sixty (60) days after the date the statement was tendered, either party may, during the thirty (30) days next following the expiration of the sixty (60) days, refer such disputed item or items to an independent certified public accountant selected by Landlord and reasonably acceptable to Tenant, for a determination which shall be final, conclusive and binding upon Landlord and Tenant. Tenant agrees to pay all costs involved in such determination unless it is determined that Landlord's original calculation of Property Taxes and/or Operating Expenses (whichever was challenged by Tenant) was in error by more than five (5%) percent in which event Landlord shall pay the entire amount of the costs involved in such determination. Pending the determination of any dispute with respect to the statement submitted by Landlord, Tenant shall pay when due the sums shown as due on such statement. If it shall be determined that any portion of such sums were not properly chargeable to Tenant, then Landlord shall promptly credit or refund the appropriate sum to Tenant.

(c) The installment of the Base Rent for the first month of the Initial Term of the Lease shall be paid by Tenant to Landlord on the Term Commencement Date. Rent shall be paid to Landlord on or before the first day of each and every successive calendar month after the first month during the Initial Term of this Lease. In the event the Term Commencement Date is other than the first day of a calendar month or the Term Expiration Date is other than the last day of a calendar month, then the monthly Rent for the first and last fractional months of the Initial Term or any applicable Extended Term shall be prorated by multiplying the monthly Rent by a fraction, the numerator of which is the number of days of the partial month included in the Initial Term or any applicable Extended Term and the denominator of which is the total number of days in the full calendar month.

(d) Rent shall be paid to Landlord at Landlord's address for notices hereunder or to such other person or entity or at such other place as Landlord may from time to time designate in writing.

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