- 8 -
was to be paid over those 24 years of the lease term.
Taking into account the foregoing considerations involving
the requirements of the TIAA term loan, Partnership, PFI, and
BCE, the lease agreement contained the following provisions with
respect to the amounts and due dates of the rent to be paid under
that agreement. It required BCE to pay Partnership "net basic
rent" (basic rent) in arrears on each installment date throughout
the lease term "in an amount equal to the sum of the Basic Rent
Portions for all Partners."4 Schedule E of the lease agreement
set forth a schedule (rent payment schedule) that allocated the
basic rent to be paid by BCE for the entire lease term, providing
the amounts of basic rent to be paid and the due dates for the
payment of such rent. Pursuant to the lease agreement and the
rent payment schedule, (1) for the initial lease period of
approximately 11.5 months that began on June 17, 1988, and ended
on May 31, 1989, the amount of basic rent to be paid by BCE was
zero; and (2) for each of the 24-annual lease periods thereafter
4 The lease agreement provided that "For any Installment Date,
the 'Basic Rent Portion' for any Partner shall mean the product
of (i) said Partner's percentage interest in the Lessor as speci-
fied on Schedule E, times (ii) the percent figure for such Part-
ner set forth opposite said Installment Date, times (iii) Les-
sor's Cost as specified on Schedule E." The lease agreement
defined the term "installment date" for purposes of the payment
of the basic rent to mean July 1, 1989, and the first day of each
month thereafter throughout the lease term. For all other
purposes, the lease agreement defined that term to mean July 1,
1988, and the first day of each month thereafter during the lease
term.
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