FOREGOING, THE AMORTIZATION PERIOD
USED WITH RESPECT TO (B) ABOVE SHALL NOT BE LESS THAN THE LESSER OF (I) ONE YEAR
MULTIPLIED BY THE AMOUNT OBTAINED BY DIVIDING THE COST OF SUCH CAPITAL
IMPROVEMENT BY $50,000 AND (II) THE REASONABLE USEFUL LIFE OF SUCH CAPITAL
IMPROVEMENT.
(11)
ALL PROPERTY MANAGEMENT FEES, NOT TO EXCEED FOUR PERCENT (4%) OF
GROSS RENTS OF THE PROJECT.
(B)
NOTWITHSTANDING THE PROVISIONS OF SECTION 4.3(A) ABOVE TO THE
CONTRARY, OPERATING COST SHALL EXCLUDE (I) COSTS ARISING FROM THE VIOLATION OF
ANY APPLICABLE LAW BY LANDLORD, ANY OTHER OCCUPANT OF THE PROJECT, OR THEIR
RESPECTIVE AGENTS, EMPLOYEES OR CONTRACTORS, EXCEPT TO THE EXTENT SUCH COSTS
REFLECT COSTS THAT WOULD HAVE BEEN INCURRED BY LANDLORD ABSENT SUCH VIOLATION,
(II) THE CAPITAL COST OF REPAIRS AND OTHER WORK OCCASIONED BY INSURED CASUALTY,
EXCEPT FOR THE DEDUCTIBLE AMOUNTS SET FORTH IN SECTION 4.3(A)(7) ABOVE,
(III) ANY REPAIRS OF A CAPITAL NATURE NECESSARY TO CURE DEFECTS IN THE INITIAL
CONSTRUCTION OF THE PROJECT AND COSTS OF COMPLIANCE WITH APPLICABLE BUILDING
CODES TO THE EXTENT THE PROJECT DOES NOT COMPLY WITH SUCH BUILDING CODES AS OF
THE DATE OF THIS LEASE AND SUCH COMPLIANCE IS REQUIRED AS OF THE DATE OF THIS
LEASE, (IV) THE COST (INCLUDING PERMITS, LICENSES AND INSPECTION FEES) OF
DECORATING, IMPROVING FOR TENANT OCCUPANCY, RENOVATING, PAINTING OR REDECORATING
PORTIONS OF THE PROJECT TO BE DEMISED TO TENANTS, (V) COSTS, FEES AND EXPENSES
INCURRED IN CONNECTION WITH LEASE NEGOTIATIONS OR LEASE DISPUTES WITH CURRENT OR
PROSPECTIVE PROJECT TENANTS, (VI) PENALTIES OR OTHER COSTS INCURRED DUE TO A
VIOLATION BY LANDLORD, AS DETERMINED BY WRITTEN ADMISSION, STIPULATION, FINAL
JUDGMENT OR ARBITRATION AWARD, OF ANY OF THE TERMS AND CONDITIONS OF THIS LEASE
OR ANY OTHER LEASE RELATING TO THE PROJECT EXCEPT TO THE EXTENT SUCH COSTS
REFLECT COSTS THAT WOULD HAVE BEEN INCURRED BY LANDLORD ABSENT SUCH VIOLATION,
(VII) INCREASES IN INSURANCE COSTS DIRECTLY ATTRIBUTABLE TO THE ACTIVITIES OF
ANOTHER TENANT IN THE PROJECT, (VIII) THE COST OF ANY HAZARDOUS MATERIAL
ABATEMENT OR REMOVAL ACTIVITIES, PROVIDED, HOWEVER, OPERATING COST MAY INCLUDE
MINOR COSTS ATTRIBUTABLE TO THOSE ACTIONS TAKEN BY LANDLORD TO COMPLY WITH ANY
LAWS, RULES AND REGULATIONS INCIDENTAL TO WITH THE ORDINARY OPERATION AND
MAINTENANCE OF THE PROJECT, INCLUDING COSTS INCURRED IN REMOVING LIMITED AMOUNTS
OF HAZARDOUS MATERIALS FROM THE BUILDING WHEN SUCH REMOVAL IS DIRECTLY RELATED
TO SUCH ORDINARY MAINTENANCE AND OPERATION, (IX) INTEREST, CHARGES, AND FEES
INCURRED ON
12
DEBT, OTHER THAN AS PERMITTED UNDER ITEM (10) ABOVE, (X) COSTS TO MAINTAIN THE
FOUNDATION, ROOF STRUCTURE, EXTERIOR WALLS AND OTHER STRUCTURAL COMPONENTS OF
THE BUILDING, (XI) CO-INSURANCE PAYMENTS, AND (XII) THE COST OF ANY REPAIRS,
IMPROVEMENTS, ALTERATIONS OR EQUIPMENT WHICH WOULD BE PROPERLY CLASSIFIED AS
CAPITAL EXPENDITURES ACCORDING TO GENERALLY ACCEPTED ACCOUNTING PRINCIPLES AND
PRACTICES (EXCEPT FOR ANY CAPITAL EXPENDITURES EXPRESSLY INCLUDED IN OPERATING
COST PURSUANT TO ITEMS (7) AND (10) OF SECTION 4.2(A) ABOVE).
TENANT'S
PROPORTIONATE SHARE OF CAPITAL EXPENDITURES INCLUDED IN OPERATING COST PURSUANT
TO ITEM (7) OF SECTION 4.2 ABOVE, IF GREATER