Common use of Percentage Increases Clause in Contracts

Percentage Increases. The Basic Monthly Rent (as adjusted pursuant to Section 3.2.1 above) shall be increased on the first day of each Lease Year (as defined below) after the first Lease Year and on the first day of the next six (6) Lease Years (“Adjustment Date”) by 3.5% of the previous year’s Basic Monthly Rent. Commencing at the commencement of the seventh Lease Year and upon the first day of each Lease Year thereafter the Basic Monthly Rent shall be increased 5% over the Basic Monthly Rent for the previous Lease Year. When Basic Monthly Rent commences for the Phase II Premises it shall be calculated as if it had commenced on the same date as the Commencement Date for the Phase I Premises. Lease Year is defined to mean the first day of the first month following the twelve (12) month anniversary date (“Anniversary Date”) of the Commencement Date applicable to Phase I. An example of the calculation of Basic Monthly Rent after the Commencement Date of each phase follows: Rentable Area 10,873 sq. ft. 10,873 sq. ft. Commencement Date February 1, 1994 January 1, 1996 Landlord TI Cost $ 60.00 $ 65.00 On the Commencement Date for the Phase I Premises, Basic Monthly Rent for the Phase I Premises would be adjusted to account for the Landlord’s share of Tenant Improvement Costs of $60.00. Thus, the Basic Monthly Rent of $1.90 per square foot of Rentable Area would be reduced to $1.80 per square foot of Rentable Area for a total Basic Monthly Rent of $19,571.40 per month from the Commencement Date of February 1, 1994 to the Anniversary Date of February 1, 1995. On February 1, 1995 the Basic Monthly Rent would be increased 3.5% to $20,256.40. On February 1, 1996 (the Anniversary Date of the Third Lease Year) the Basic Monthly Rent would be increased by 3.5% to $20,965.37. On the Commencement Date for the Phase II Premises the Basic Monthly Rent would be adjusted to account for the Landlord’s share of Tenant Improvement Costs for Phase II of $65.00. Thus, the Basic Monthly Rent of $1.90 per square foot of Rentable Area would be reduced to $1.85 per square foot of Rentable Area for a total of $20,115.04 per month. Although rent for the Phase II Premises would not be due until the Commencement Date for the Phase II Premises, which will be the earlier of substantial completion of the Tenant Improvements for the Phase II Premises or January 1, 1996, the calculation of the adjustment to Basic Monthly Rent would be made from February 1, 1994 (the Commencement Date of the Phase I Premises). Thus, the $20,819.08 would be increased by 3.5% as of January 1, 1995 to the amount of $20,819.08 and this amount would be increased as of January 1, 1996 by 3.5% to the amount of $21,547.74. Therefore, as of January 1, 1996, the total Basic Monthly Rent for Phase I and Phase II Premises would be $42,513.11. All further adjustments would be made to this amount.

Percentage Increases. The Basic Monthly Rent (as adjusted pursuant to Section 3.2.1 above) shall be increased on the first day of each Lease Year (as defined below) after the first Lease Year and on the first day of the next six (6) Lease Years (“Adjustment Date”) by 3.5% of the previous year’s Basic Monthly Rent. Commencing at the commencement of the seventh Lease Year and upon the first day of each Lease Year thereafter the Basic Monthly Rent shall be increased 5% over the Basic Monthly Rent for the previous Lease Year. When Basic Monthly Rent commences for the Phase II Premises it shall be calculated as if it had commenced on the same date as the Commencement Date for the Phase I Premises. Lease Year is defined to mean the first day of the first month following the twelve (12) month anniversary date (“Anniversary Date”) of the Commencement Date applicable to Phase I. An example of the calculation of Basic Monthly Rent after the Commencement Date of each phase follows: Assumptions: Phase I Phase II Rentable Area 10,873 sq. ft. 10,873 sq. ft. Commencement Date February 1, 1994 January 1, 1996 Landlord TI Cost $ 60.00 $ 65.00 On the Commencement Date for the Phase I Premises, Basic Monthly Rent for the Phase I Premises would be adjusted to account for the Landlord’s share of Tenant Improvement Costs of $60.00. Thus, the Basic Monthly Rent of $1.90 per square foot of Rentable Area would be reduced to $1.80 per square foot of Rentable Area for a total Basic Monthly Rent of $19,571.40 per month from the Commencement Date of February 1, 1994 to the Anniversary Date of February 1, 1995. On February 1, 1995 the Basic Monthly Rent would be increased 3.5% to $20,256.40. On February 1, 1996 (the Anniversary Date of the Third Lease Year) the Basic Monthly Rent would be increased by 3.5% to $20,965.37. On the Commencement Date for the Phase II Premises the Basic Monthly Rent would be adjusted to account for the Landlord’s share of Tenant Improvement Costs for Phase II of $65.00. Thus, the Basic Monthly Rent of $1.90 per square foot of Rentable Area would be reduced to $1.85 per square foot of Rentable Area for a total of $20,115.04 per month. Although rent for the Phase II Premises would not be due until the Commencement Date for the Phase II Premises, which will be the earlier of substantial completion of the Tenant Improvements for the Phase II Premises or January 1, 1996, the calculation of the adjustment to Basic Monthly Rent would be made from February 1, 1994 (the Commencement Date of the Phase I Premises). Thus, the $20,819.08 would be increased by 3.5% as of January 1, 1995 to the amount of $20,819.08 and this amount would be increased as of January 1, 1996 by 3.5% to the amount of $21,547.74. Therefore, as of January 1, 1996, the total Basic Monthly Rent for Phase I and Phase II Premises would be $42,513.11. All further adjustments would be made to this amount.