Fixed and Percentage Rent Clause
(Retail Lease)(Pro-Landlord)

Summary

This fixed and percentage rent clause may be included in a retail lease to set forth the tenant's obligations to pay fixed and percentage rent to the landlord. This template contains practical guidance, drafting notes, and alternate and optional clauses. Rent is the consideration paid by the tenant for the use and occupancy of the leased premises. A retail tenant typically pays the landlord both fixed rent (usually based upon square footage) and percentage rent (meaning a share of its sales). Though the amount of rent paid by the tenant is a negotiated business term, lease provisions addressing the manner and timing of rent payments, as well as the calculation of percentage rent, warrant close scrutiny from counsel to both parties. This clause favors the landlord but contains optional provisions favoring the tenant, as well as drafting notes from both parties' perspectives. Defined terms used in this clause should be conformed to those used in the relevant lease. For a full listing of key content covering retail leasing, see Retail Leasing Resource Kit. For further guidance on rent provisions in retail leases, see Retail Lease Agreements. For additional rent abatement or concession clauses, see Interruption of Services with Rent Abatement Clause (Commercial Lease) (Pro-Tenant), Rent Abatement Clauses (Commercial Lease) (Pro-Landlord), Rent Abatement Clauses (Commercial Lease) (Pro-Tenant), Rent Concession Clause (Commercial Lease) (Pro-Landlord), and Rent Concession Clause (Commercial Lease) (Pro-Tenant).