Rent Lessee shall pay Lessors rent for the use of the Equipment pursuant to the terms of this Paragraph 3 (“Rent”). Rent shall accrue during the Initial Term, and Lessee shall pay Lessors Rent attributable to the Initial Term at the expiration of the Term (in connection with Lessee’s payment under its purchase obligation pursuant to Paragraph 7 below), subject to Lessee’s right to pay Rent currently as it accrues. Lessee shall pay Rent to Lessors on a quarterly basis during each of the First Renewal Term, the Second Renewal Term and the Third Renewal Term, in each case if Lessee exercises the applicable renewal option. Rent during the Initial Term shall be equal to an annual rate of twelve percent (12%) of the Purchase Price (as defined in the Sale and Leaseback Agreement, taking into account the dates on which each installment of the Purchase Price is actually paid to Lessee), compounded quarterly. The Rent during the First Renewal Term shall be equal to an annual rate of thirteen percent (13%) of the Purchase Price (compounded quarterly if Lessee fails to pay Rent currently as required by this Paragraph 3). Rent during the Second Renewal Term shall be equal to an annual rate of fourteen percent (14%) of the Purchase Price (compounded quarterly if Lessee fails to pay Rent currently as required by this Paragraph 3). Rent during the Third Renewal Term shall be equal to an annual rate of fifteen percent (15%) of the Purchase Price (compounded quarterly if Lessee fails to pay Rent currently as required by this Paragraph 3). If any Rent or other amount payable by Lessee is not paid within five days after the day on which it becomes payable, Lessee will pay on demand, as a late charge, an amount equal to 5% of such unpaid Rent or other amount but only to the extent permitted by applicable law. All payments provided for herein shall be payable to Lessors at the address specified in Paragraph 23 below, or at any other place designated by Lessors. For purposes of calculating the amount of Rent that accrues during any period, the Purchase Price shall be reduced by 100/105ths of any amounts treated as a reduction of Exercise Price in accordance with the last sentence of Paragraph 7 below, as of the date such amounts are paid to Lessors.
Additional Rent Notwithstanding the provisions of the Original Lease, this Amended and Restated Lease Agreement is structured as a “triple net” lease. Accordingly, the provisions for Additional Rent based on Operating Expenses and Taxes are rewritten as follows. LESSEE shall also pay to LESSOR, as Additional Rent under the Lease, the following amounts based on LESSEE’S allocable percentage (which is 8.3441%, the ‘‘Allocable Percentage”): A. Operating Expenses: LESSEE shall be responsible for payment of Additional Rent attributable to the Operating Expenses for the Building and site, based on LESSEE’S Allocable Percentage. Operating Expenses, as set forth in Exhibit B hereto, are the unaudited actuals for calendar year 2006 (and will be subject to change based on actual costs and expenses incurred for each of the categorized Exhibit B costs and expenses in 2007 and each subsequent year during the Extended Term). “Operating Expenses” shall not include the following: the costs of LESSEE’S improvements and services for which LESSEE or any tenant specifically and directly reimburses LESSOR, or pays third persons at LESSOR’S directions; income or franchise taxes of the LESSOR; the costs incurred in any rehabilitation, reconstruction or other work occasioned by any insured casualty (i.e. as to which LESSOR is required to carry insurance hereunder), or by the exercise of the right of eminent domain (except to the extent of any so-called “deductible” amount under policies of insurance or any costs actually incurred for which any insurance company does not reimburse or compensate LESSOR or Owner); depreciation of the Building; general corporate overhead of the LESSOR entity; legal expenses incurred in any direct dispute with any particular tenant (other than those incurred which are of benefit to or protect the rights of other tenants in the Building, generally); costs of renovations to other tenants’ spaces; costs of capital improvements; brokerage and advertising costs in seeking new tenants; and penalties incurred due to LESSOR’S willful violation of any direct violation of any government order.