H

Hazardous Materials: Materials, often defined by governmental law or statute, which if introduced onto a property by either a landlord or tenant could result in a reduction of the value of the property or the ability of a tenant to use their leased premises for the purposes outlined in the lease. Hazardous Materials clauses within a lease specify the materials which are considered to be hazardous, provide for remedies if such materials are introduced on the property or in the leased premises and provide indemnities for the non-introducing party should litigation occur.

EXAMPLE: ABC Tenant performs the business of photographic development from its premises at Ellipsis Tower. Many of the chemicals used in the development process have been identified as hazardous by federal and state laws. The Landlord, to protect itself, includes a Hazardous Materials clause in the lease with ABC, whereby if any of the chemicals used by ABC are stored, handled or disposed of in violation of federal and state laws, ABC shall be responsible for all required clean-up and shall indemnify the Landlord in the event of any litigation.

Holdover: A tenant who remains in possession of leased premises after the expiration date of the lease. Leases often provide the landlord to charge holdover rent to a tenant during the holdover period, typically quoted as a percentage (greater than 100%) of either Rent, Base Rent only or Base Rent and Expense Recoveries.

EXAMPLE: Upon the expiration of their lease at Ellipsis Tower, ABC Tenant does not vacate the premises because the space that they are moving into in another building will not be ready for occupancy for an additional two months. As of the expiration date, ABC is paying the Landlord $10,000/month for Base Rent and $4,000/month for expense recoveries. Because of a Holdover clause in ABC's lease which allows the Landlord to charge holdover rent equal to 150% of Base Rent and Additional Rent during the holdover period, ABC must pay the Landlord $21,000/month ($14,000 multiplied by 150%) until they vacate Ellipsis Tower.

I

IC Code: Abbreviation for 'Industry Classification' Code, used to classify companies by the type of goods and/or services that they provide. A commonly used IC Code is the 'SIC Code', which stands for Standard Industrial Classification Code. Beginning in 1997, the SIC Code was replaced by NAICS, which stands for North American Industry Classification System.

J

K

Kiosk: A small, independent stand often placed within the common area of a retail structure (typically a regional mall) from which specialty goods are sold.

EXAMPLE: ABC Retail Tenant is a specialty tenant that sells ornaments during the holiday season. Since they do not need to operate their premises year round, and only need a small amount of space, they execute a short-term lease to operate a kiosk within the common areas of an enclosed mall.