OF SUCH ITEM DETERMINED
IN ACCORDANCE WITH GAAP, TOGETHER WITH INTEREST THEREON AT TWO PERCENT (2%) IN
EXCESS OF THE THEN CURRENT BASE RATE PER ANNUM; (XII) MANAGEMENT FEES NOT
EXCEEDING TWO AND ONE-HALF (2-1/2%) PERCENT OF GROSS REVENUES DERIVED FROM THE
BUILDING; (XIII) ALL REASONABLE COSTS AND EXPENSES OF LEGAL, BOOKKEEPING,
ACCOUNTING AND OTHER PROFESSIONAL SERVICES INCURRED IN CONNECTION WITH THE
OPERATION, AND MANAGEMENT OF THE REAL PROPERTY EXCEPT AS HEREINAFTER EXCLUDED;
(XIV) FEES, DUES AND OTHER CONTRIBUTIONS PAID BY OR ON BEHALF OF LANDLORD OR
LANDLORD'S AFFILIATES TO CIVIC OR OTHER REAL ESTATE ORGANIZATIONS PROVIDED SAME
DO NOT EXCEED THE LEVEL CUSTOMARILY PAID BY OWNERS OF FIRST-CLASS OFFICE
BUILDINGS IN MIDTOWN MANHATTAN COMPARABLE TO THE BUILDING; AND (XV) ALL OTHER
FEES, COSTS, CHARGES AND EXPENSES PROPERLY ALLOCABLE TO THE REPAIR, MAINTENANCE,
OPERATION AND/OR SECURITY OF THE REAL PROPERTY, IN ACCORDANCE WITH THEN
PREVAILING CUSTOMS AND PRACTICES OF THE REAL ESTATE INDUSTRY IN THE BOROUGH OF
MANHATTAN, CITY OF NEW YORK.
THE TERM "OPERATING EXPENSES", AS USED AND DEFINED
UNDER THIS SECTION 3.01(E), SHALL NOT, HOWEVER, INCLUDE THE FOLLOWING ITEMS:
(1) DEPRECIATION AND AMORTIZATION AND OTHER CAPITAL EXPENDITURES (EXCEPT AS
PROVIDED ABOVE IN CLAUSES (X) AND (XI) OF THIS SUBSECTION); (2) GROUND RENTS AND
INTEREST ON AND AMORTIZATION OF DEBTS (AND COSTS AND CHARGES INCURRED IN
CONNECTION WITH SUCH FINANCINGS); (3) THE COST OF TENANT IMPROVEMENTS MADE FOR
TENANT(S) OF THE BUILDING OR ALLOWANCES IN LIEU THEREOF; (4) BROKERAGE
COMMISSIONS; (5) FINANCING OR REFINANCING COSTS; (6) THE COST OF ANY WORK OR
SERVICES PERFORMED FOR ANY TENANT(S) OF THE BUILDING (INCLUDING TENANT), WHETHER
AT THE EXPENSE OF LANDLORD OR LANDLORD'S AFFILIATES OR SUCH TENANT(S), TO THE
EXTENT THAT SUCH WORK OR SERVICES ARE IN EXCESS OF THE WORK OR SERVICES WHICH
LANDLORD OR LANDLORD'S AFFILIATES ARE REQUIRED TO FURNISH TENANT UNDER THIS
LEASE, AT THE EXPENSE OF LANDLORD OR LANDLORD'S AFFILIATES; (7) THE COST OF ANY
ELECTRICITY CONSUMED IN THE PREMISES OR ANY OTHER SPACE IN THE BUILDING DEMISED
TO TENANT(S); (8) TAXES; (9) SALARIES AND FRINGE BENEFITS FOR OFFICERS,
EMPLOYEES AND EXECUTIVES ABOVE THE GRADE OF BUILDING MANAGER; (10) AMOUNTS
RECEIVED BY LANDLORD THROUGH THE PROCEEDS OF INSURANCE OR CONDEMNATION OR FROM A
TENANT (OTHER THAN PURSUANT TO AN ESCALATION PROVISION SIMILAR TO THIS
ARTICLE 3) OR OTHERWISE TO THE EXTENT SUCH AMOUNTS ARE COMPENSATION FOR SUMS
PREVIOUSLY INCLUDED IN OPERATING EXPENSES FOR SUCH
8
OPERATING YEAR OR ANY PRIOR OPERATING YEAR; (11) COSTS OF REPAIRS OR
REPLACEMENTS INCURRED BY REASON OF FIRE OR OTHER CASUALTY OR CONDEMNATION EXCEPT
THAT IN CONNECTION THEREWITH ANY AMOUNT EQUAL TO THE DEDUCTIBLES UNDER
LANDLORD'S INSURANCE POLICIES (OR IN THE EVENT LANDLORD SHALL NOT CARRY
INSURANCE, AN AMOUNT OF DEDUCTIBLES CUSTOMARILY CARRIED BY LANDLORDS OF
FIRST-CLASS OFFICE BUILDINGS COMPARABLE TO THE BUILDING) MAY BE INCLUDED WITHIN
OPERATING EXPENSES; (12) ADVERTISING AND PROMOTIONAL EXPENDITURES; (13) LEGAL,
ACCOUNTING AND OTHER PROFESSIONAL FEES INCURRED IN CONNECTION WITH
(I) NEGOTIATIONS OR DISPUTES BY LANDLORD, ITS AFFILIATES OR PARTNERS WITH
LENDERS, SUPERIOR LESSORS OR TENANTS, OR