Common use of MAG Clause in Contracts

MAG. The MAG shall be an annual amount equal to the greater of (a) the Floor Element Amount (as defined below) for the applicable Agreement Year or (b) the Prior Year Element Amount (as defined below) for the applicable Agreement Year. The “Floor Element Amount” shall be the sum of Seven Hundred and Thirty-three Dollars and Thirty-three Cents ($733.33) per square foot per year for Fast Casual Dining and Seven Hundred Dollars ($700) per square foot per year for Branded Coffee (the “Per Square Foot MAG”), multiplied times the total number of square feet of space contained in each Unit (as such square footage is determined by the CEO); provided, however, that, in connection with the calculation of the Floor Element Amount, the Per Square Foot MAG shall be adjusted annually as set forth below. For the second (2nd) Agreement Year of the Term and for each Agreement Year of the Term thereafter (including any extension thereof) [said second (2nd) Agreement Year and each subsequent Agreement Year being referred to in this paragraph as an “Adjustment Year”], the Per Square Foot MAG shall be an amount equal to the greater of the following: (a) eighty-five percent (85%) of the Base Rent in effect for the immediately prior Agreement Year, or (b) the Per Square Foot MAG in effect for the immediately prior Agreement Year increased by the percentage increase, if any, in the CPI (as defined below) for the Comparison Month (as defined below) for such Adjustment Year over the CPI for the Base Month (as defined below) for such Adjustment Year; provided, however, that in no event shall the Per Square Foot MAG for a given Adjustment Year be decreased as the result of such computation; and provided, further, that in no event shall the Per Square Foot MAG for a given Adjustment Year be increased by more than two percent (2%) of the Per Square Foot MAG in effect for the immediately prior Adjustment Year. The term “CPI” shall mean the Consumer Price Index of the Bureau of Labor Statistics of the U.S. Department of Labor of CPI-U (all urban consumers) for Los Angeles - Riverside - Orange County, CA (all items 1982 - 1984 equals one hundred). In the event that the compilation and/or publication of the CPI shall be discontinued, then the index most nearly the same as the CPI shall be used to make such calculation (as reasonably determined by the CEO). The term “Comparison Month” shall mean the month that is two (2) months prior to the first (1st) month of the applicable Adjustment Year. The term “Base Month” shall mean the month that is fourteen (14) months prior to the first (1st) month of the applicable Adjustment Year. The “Prior Year Element Amount” shall be an amount equal to eighty-five percent (85%) of the Base Rent for the immediately prior Agreement Year.