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additional capital contributions to Partnership on the first day
of each month during the period July 1, 1988, through June 1,
1989, in the amount of approximately $1,759,144.
The amounts and due dates of rent payable under the lease
agreement that were not required by TIAA in order to service the
TIAA term loan were developed through the use of a computer
program that took into consideration certain requirements of the
lessor and the lessee. Those requirements included (1) creating
a schedule for the payment of rent that took account of projected
increases in rent in the Denver market for office space (Denver
office market) and that not only provided a certain yield for the
lessor and its partners3 but also minimized the cost to the
lessee and (2) structuring the total amount of rent to be paid
during each of the 24-annual lease periods that start on June 1
and end on May 31 (annual lease period) following the 11.5-month
period of zero rent (including the amount of rent to be paid
monthly to service the TIAA term loan) so that such total amount
during each such period was always within 90 percent to 110
percent of the average annual amount of the aggregate rent that
3 PFI entered into the sale-leaseback transaction involving Re-
public Plaza in order to make a profit. At the time PFI was de-
termining the profit that it expected to realize from that trans-
action, it anticipated that it would (1) pay Federal and State
income taxes at the highest marginal rate throughout the lease
term, (2) realize $205 million of pretax profit, and (3) pay in
the aggregate approximately $75 million in income taxes over the
lease term.
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Last modified: May 25, 2011