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receives rent in any lease year (as defined below) from the non-childcare space in excess <br />of $54.00 multiplied by the number of rentable square feet, triple net (said amount being <br />referred to herein as the "Threshold"), fifty percent (50%) of such excess shall be paid to <br />Lessor as additional rent. The $54.00 base rental rate shall be escalated annually with the <br />first escalation being effective January 1, 2001, by the same percentage that the <br />Consumer Price Index, All Items, for the San Francisco/Oakland/San Jose metropolitan <br />area (the "Index") has increased during the preceding year, as measured by the Index as <br />most recently published prior to the applicable January 1st date. Lessor shall consider <br />utilizing its share of such excess rents for childcare purposes. <br /> <br /> For the purpose of determining whether the Threshold has been exceeded <br />(as such Threshold may be increased from time to time) only deficits (amounts received <br />which are less than the Threshold, as adjusted) in any lease year (for the first year the <br />period from certificate of occupancy to the following December 31st and each 12 month <br />period thereafter) that are caused by bankruptcy, or a tenant default in payment of rent <br />where, because of the tenant's financial condition, Lessor concludes that legal proceeding <br />against the tenant would not be economically justified, shall be carded forward and <br />"made up" from the rents from subsequent year(s) before any excess rent is divided. In <br />making the above calculations with regard to whether additional rent is due to Lessor, <br />rents received by Lessee shall not be reduced by the expenses incurred by Lessee (e.g. <br />leasing commissions, marketing, legal fees, etc.), other than expenses payable or <br />reimbursable by tenants pursuant to triple net leases, in connection with leasing the non- <br />childcare space. Further, Lessor shall not cause any tenant of non-childcare space to <br />either defer or accelerate payment of rent in a manner which would diminish additional <br />rent otherwise payable to Lessor hereunder. <br /> <br /> For example if in the second lease year there is a (i) deficit of $20,000.00 <br />resulting from the bankruptcy of a tenant and in the third lease year the rents produce an <br />excess of $30,000, then the $20,000.00 deficit would be camed forward and applied <br />against the $30,000.00 excess leaving net excess rents of $10,000.00, which would be <br />divided equally between Lessor and Lessee. <br /> <br />17996.00003~BGLIB 1\1085097.9 6 <br /> <br /> <br />