Property Management Agreement
Exhibit 10.25
Monday, December 31, 2018
Generation Income Properties Inc.
Attn: Xxxxx Xxxxxxxx
000 X. Xxxxxxx Xx.
Xxxxx 0000
Xxxxx, XX 00000
Xx. Xxxxx Xxxxxxxx:
We are pleased to confirm the arrangements (this “Agreement”) under which 3 Properties LLC, (“Agent”) will act as the property manager for Generation Income Properties Inc., and its affiliates listed in Exhibit B (“Owner”) and the properties listed in Exhibit B (attached hereto) and their corresponding entities (each a “Property” and together the “Properties”) as of January 01, 2019 (the “Effective Date”) upon the terms and in consideration of the mutual covenants herein set forth:
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a) | This Agreement is for a minimum of one (1) year commencing on the Effective Date and thereafter this Agreement shall automatically renew on each anniversary of the Effective Date, unless terminated in writing delivered by either party hereto to the other party hereto at least 60 days in advance of the applicable anniversary of the Effective Date (the “Term”). |
b) | Either party may terminate this Agreement upon 90 days written notice to the other party with or without “cause;” upon termination of this Agreement the Owner shall pay to the Agent any amounts earned but unpaid for Services performed on or before the date of such termination. For purposes of this Agreement “cause” shall mean: (i) the Agent’s conviction, pleading guilty or no contest with respect to a felony; (ii) the Agent’s engagement in misconduct that is materially detrimental to the Owner’s reputation or business; or (iii) the Agent’s material breach of this Agreement, in each case, as determined by a final, non-appealable judicial decision. |
c) | In the event of termination of this Agreement, the parties shall account to each other with respect to all matters outstanding as of the date of termination. The Owner shall furnish the Agent with a release of liability or a hold harmless agreement for and against any outstanding obligations or liabilities which the Agent may have incurred on behalf of the Owner under this Agreement |
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2. | Compensation: During the Term, Agent shall receive from Owner the following compensation: |
a) | The asset management fee shall be 1.75% of gross monthly rents received from the Properties listed in Exhibit B (the “Management Fee”). Properties listed in Exhibit B may be amended from time to time in the event of a sale of Property or purchase of new property. Management Fee and any additional amounts based upon fees and reimbursements shall be payable monthly in arrears, within five (5) calendar days following the last day of each calendar month. The Management Fee will be based on the gross rent received (excluding reimbursements for direct expenses) on the date billed. Agent shall be responsible for the management of projects for the improvement, repair, legal compliance and alteration of the Properties and Agent shall charge $125.00 per hour for work performed (i) outside Agents scope of “Services” including overseeing work performed by Agent’s outside agents and building technicians; or (ii) where the cost of a project is greater than $5,000.00 (to cover additional time and effort by Agent engaging or supervising vendors and coordinating repair schedules with tenant schedules). |
b) | Final payment of third party expenses by Owner shall relieve Agent of responsibility for faulty, defective, or recalled materials or workmanship, provided that Agent’s vendors hold commercial insurance at a sufficient amount to protect both Agent and Owner. If requested by Owner, Agent shall furnish in connection with each request or invoice for payment statutory unconditional lien waiver and release forms executed and notarized by vendors performing such work and all other individuals and entities which may have lien rights. Any payment made under this Agreement shall not be construed as evidence of acceptance of any part of the Services. |
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a) | Agent acknowledges and agrees that the terms and conditions of this Agreement will govern in all respects the Services provided by Agent, regardless of any contrary or competing terms or conditions contained in any proposal or other form provided by Agent, any subcontractor, or any other party relating to the Services to the extent they are inconsistent with any provision of this Agreement or limit the scope of any indemnity or other liability of Agent. The inclusion by reference in this Agreement of any proposal, order, invoice, request for proposal, or other document provided or prepared by Agent or any subcontractor is merely for convenience of identification of the scope of services or materials provided and any and all other such terms and conditions are expressly not incorporated nor valid for any purpose to the extent they contradict this Agreement. Without limiting the foregoing, this provision shall not pertain to any insurance policy, certificate, or other document required in connection with Agent’s indemnity obligations herein. |
b) | The Agent, in accepting the management of the Properties, will perform his/her/its duties as herein provided, using his/her/its commercially reasonable judgment, efforts and ability relative to the following and/or the Services described in Exhibit A, for and on behalf of the Owner and at Owner’s sole expense. Owner acknowledges that the “Services” do not include collection of rent or payment of invoices relating to the Properties or the actual providing of physical maintenance and repair work at the Properties. |
c) | Agent shall be free of responsibility for any delays, in the event Owner notifies Agent in writing that it is necessary, in the judgment of Owner, that Agent delays its work in connection to any repair or maintenance of Property being managed by Agent. |
d) | Agent may designate an agent representative for the Property, and may change the identity of the agent representative at any time. Agent representative may assist Agent in coordinating the functions and services of Agent hereunder, and shall perform certain Agent functions and services required to be performed by Agent hereunder. Agent representative shall be an agent of Agent. Notwithstanding the foregoing, all obligations of Agent representative hereunder shall be obligations of Agent hereunder. |
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e) | Any changes or modifications regarding the Services or compensation must be in writing and approved by the Owner in writing before additional items are supplied. |
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a) | Owner shall carry, at its expense, commercial liability insurance and worker’s compensation insurance (if Owner has employees) to protect the interests of Owner and Agent, who shall be named as an additional insured, under this agreement. Owner shall provide Agent with a certificate of insurance evidencing such coverage. The commercial liability insurance coverage shall have minimum limits of $2,000,000 including premises/operations, products/completed operations, independent contractors, advertising liability, personal injury liability and contractual liability. All such insurance shall be primary, except with respect to the Agent’s breach of this Agreement or its gross negligence or willful misconduct, in which event Agent’s insurance shall be primary. |
b) | Agent represents and warrants to Owner that Agent will maintain at all times during the Agreement general liability insurance insuring Agent and Owner in the amount of at least $1,000,000 against any claim or liability from third parties arising out of Agent’s acts or omissions under this Agreement. Agent shall name Owner as additional insured on Agent’s insurance policy and provide Owner annually with a certificate of insurance and a copy of the endorsement showing that Agent’s insurance policy has been modified to add Owner as additional insured in accordance with Appendix A (attached). |
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c) | Agent agrees to indemnify, defend, and hold Owner harmless from and against any and all liability, loss, cost, damage or expense imposed upon or asserted against Owner (except to the extent covered by Agent’s or Owner’s insurance or required to be carried by Owner hereunder) arising from Agent’s willful material breach of this Agreement or its gross negligence or willful misconduct; provided, however, that in no event shall the indemnity provided under this Section extend to any Loss if and to the extent the same is caused by the gross negligence or willful misconduct of Owner or its agents or employees. If any person or entity makes a claim or institutes a suit against Owner on a matter for which Owner claims the benefit of the foregoing indemnification, then: (a) Owner shall give Agent prompt notice (no more than 3 business days) thereof in writing; (b) Agent may defend such claim or action by counsel of its own choosing provided such counsel is reasonably satisfactory to Owner; (c) neither Owner nor Agent shall settle any claim without the other’s written consent; and (d) this subsection shall not be so construed as to release Owner or Agent from any liability to the other for a willful breach of any of the covenants agreed to be performed under the terms of this Agreement. |
d) | Owner agrees to indemnify, defend, and hold Agent harmless from and against any and all liability, loss, cost, damage or expense (except to the extent covered by insurance carried by Agent or Owner or required to be carried by Agent hereunder) imposed upon or asserted against Agent related to or in connection with the Properties, except as may be due to Agent’s breach of this Agreement or its gross negligence or willful misconduct. If any person or entity makes a claim or institutes a suit against Agent on a matter for which Agent claims the benefit of the foregoing indemnification, then: (a) Agent shall give Owner prompt notice thereof in writing; (b) Owner may defend such claim or action by counsel of its own choosing provided such counsel is reasonably satisfactory to Agent; (c) neither Agent nor Owner shall settle any claim without the other’s written consent; and (d) this subsection shall not be so construed as to release Owner or Agent from any liability to the other for a willful breach of any of the covenants agreed to be performed under the terms of this Agreement. |
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13. | Notices: All notices and other communications required by this Agreement must be in writing. |
Notice to the Owner shall be sent to:
Generation Income Properties Inc.
Attn: Xxxxx Xxxxxxxx
000 X. Xxxxxxx Xx.
Xxxxx 0000
Xxxxx, XX 00000
Email: xx@xxxxxxx.xxx
Notice to the Agent shall be sent to:
3 Properties LLC
Attn: Asset Management
000 Xxxx Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxx, XX 00000
Email: xxxxxxxx@0-xxxxxxxxxx.xxx
Notices delivered by hand, facsimile, or electronic mail shall be deemed received on the date delivered; notices delivered by certified or registered mail, return receipt requested, shall be deemed received on the date received.
14. | Governing Law: This Agreement shall be governed by the laws of the State of Florida. |
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AGENT | OWNER | |||||||
By: | Xxxxx Xxxxxxxx |
By: |
Xxxxx Xxxxxxxx |
Signature: | /s/ Xxxxx Xxxxxxxx |
Signature: | /s/ Xxxxx Xxxxxxxx | |||||
Title: | President | Title: | Owner |
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Exhibit A
Asset Management Services (the “Services”)
1. | Review leases in connection to all Properties and provide Owner with lease abstracts within 30 days following the Effective Date of the Agreement. |
2. | Generate quarterly summary of activities related to each Property. |
3. | Provide tenant relations and maintain a communication system in which representatives from Owner, tenants, representatives of Owner and/or government officials can use to contact Agent on a regular basis and in case of emergencies. Submit invoices for property taxes and insurance to Owner for payment. Submit proof of payment to tenant for reimbursement and perform all reconciliations as necessary. |
4. | Source and solicit as necessary, service providers (attorney’s accountants, lenders, brokers etc.) as well as vendors for maintenance and repairs in connection to Properties. As applicable, submit proposals and bids to Owner for approval. |
5. | Management of work projects for the improvement, repair, legal compliance and alteration of any Property subject to Section 2(b) of this Agreement. |
6. | Annual inspection of building exterior, lighting, signage, refuse enclosure, and common area of Properties. Annual inspection of the roof. Verbal communication with tenants is expected during visits. |
a. | Minimum of 1 visit per annum including (1) Lighting Inspection, (1) HVAC inspection, and (1) roof inspection. |
7. | Submit written property status report with photos of the Properties on an annual basis, including but not limited to, the following issues when applicable: |
a. | Tenant concerns |
b. | Overall Properties condition (i.e. update on recent repairs, assessment of vendor work) |
c. | Recommendations for improvement of facility, landscaping, and/or tenant and vendor relations. |
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Exhibit B
“Properties”
Xxxxxx |
Xxxxxx Xxxxxxx |
Xxxxxxx XXX | Xxxx |
Xxxxx |
Zip Code | |||||||||
7-Eleven |
0000 00xx Xxxxxx XX | $ | 117,999.96 | Xxxxxxxxxx | X.X. | 00000 | ||||||||
Starbucks |
0000 X. Xxxx Xxxxx Xxx. | $ | 182,500.00 | Xxxxx | XX | 00000 | ||||||||
Xxxxx & Whitney |
00000 XX Xxxxxxx 20 | $ | 684,996.00 | Xxxxxxx | XX | 00000 |
“Properties”
Entity Names
7-Eleven—GIPDC 0000 00xx Xx LLC
Starbucks- GIPFL 1300 S Xxxx Xxxxx LLC
Xxxxx & Xxxxxxx – XXXXX XX 00000 XX Xxxxxxx 20 LLC
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Appendix A
SPECIFIC VENDOR INSURANCE REQUIREMENTS
All coverage must be placed with a BEST’S “A” RATED CARRIER, any lower rating will not be accepted
General Liability |
$ | 1,000,000 | Combined Single Limit per occurrence (Contractual Liab., Fire & Water Legal Liab., and Cross Liab. & Severability of Interest clause) Note: may be in combination with umbrella or excess policy. | |||
Workers Compensation |
$ | 1,000,000 | Statutory limits set forth by the law of the State of Florida | |||
Umbrella or Excess Liability |
SPECIFIC ENDORSEMENTS REQUIRED
1) | Additional Insured Endorsement “HARD COPY” must be attached to certificate naming the following Additional Insured as respects to General liability: |
*Additional Insured: 3 Properties, LLC
*Certificate Holder: 3 Properties, LLC
Attn: Asset Management
000 Xxxx Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxx, XX 00000
1. | Primary Wording Clauses stating Additional Insured(s) insurance is non-contributing with any other insurance |
OR
the following statement may be provided: It is further agreed that such insurance as is afforded by this policy for the benefit of the additional insured(s) shown above shall be primary insurance, but only as respects any claims, loss or liability arising out of the operations of the named insured or from occupancy, maintenance or use of the premises by the named insured and any insurance maintained by the additional insured(s) shall be non-contributing.
2. | 30-day Notice of Cancellation: |
3. | Waiver of Subrogation on Workers Compensation AND Waiver of Subrogation on General Liability |
OR
the following statement may be provided: WAIVER OF RIGHTS OF RECOVERY—The carrier will not apply the Recovering Damages from a Third Party rule when a contract specifies that the carrier waive their subrogation rights. The carrier will only waive their subrogation rights PRIOR to the occupancy or the actual loss or damage.
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4. | NOTE to UNDERWRITER: If waiver(s) is not able to be provided immediately, please send a memo stating that waiver will follow upon approval and completion, OR have carrier provide a statement that they cannot comply with this request.) |
_____________________________
A. | PLEASE EMAIL A COPY OF THE CERTIFICATE & ENDORSEMENT TO: |
Xxxx Xxxxxxx
xxxxxxxx@0-xxxxxxxxxx.xxx
B. | PLEASE MAIL THE ORIGINAL CERTIFICATE & ENDORSEMENT TO: |
3 PROPERTIES, LLC
Attn: Asset Management
000 Xxxx Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxx, XX 00000
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INVOICE PROCEDURE
A. | All vendors must submit W-9 and insurance. |
B. | Monthly Service Invoice. Submit your monthly invoice by the 10th day of every month as stated on the vendor agreement “Conditions to Payment”. Payment will be processed before the end of the service month. Please allow up to 2 weeks for payment to arrive after it has been processed. |
C. | Repair and/or Maintenance Invoice. Invoice shall be submitted after the project has been completed. |
D. | Before and After pictures of project should be included with Invoice. |
E. | Xxxx to: |
3 Properties, LLC
Attn: Asset Management
000 Xxxx Xxxxxxx Xxxxxx, Xxxxx 0000
(000) 000-0000 Phone