Exhibit 10.4
MANAGEMENT AGREEMENT
THIS MANAGEMENT AGREEMENT (this "Agreement") made this 31st day of October, 2005
by and between PARK AVE. ASSOC. MANAGEMENT LLC (the "XXX"), a Delaware limited
liability company with a principal place of business at 000 X. Xxxx Xx.
Xxxxxxxxxx, XX 00000, (hereinafter "XXX") and PARK AVE. ASSOC. LLC, a Delaware
limited liability company with a principal place of business at 000 X. Xxxx Xx.
Xxxxxxxxxx, XX 00000, hereinafter ("PAA");
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS XXX desires to provide real estate management services to PAA; and
WHEREAS PAA desires to retain the services of XXX;
WHEREAS both parties desire to set forth their rights and responsibilities by
and between each other;
WHEREAS, capitalized terms used but not otherwise defined herein shall have the
meanings ascribed to them in the Operating Agreement of PAA of even date
herewith, as the same may be amended, restated, supplemented or otherwise
modified from time to time (the "Operating Agreement").
NOW, therefore, based upon the mutual representations and promises set forth
herein, the parties agree as follows:
1. Projects. PAA will be purchasing and developing various real estate
properties, the first three of which will be located in New Jersey and
New York--The Willows; Eagleswood and Route 111 Hauppauge
(collectively, the "Initial Projects") to be developed by PAA.
2. Services. PAA will retain the services of XXX to manage the Projects
(including each of the Initial Projects), including but not limited to
the managing of the construction of the Projects during all phases of
construction and, thereafter, operating, managing, maintaining,
administering, leasing, renting and/or selling of the units developed
in the Projects. XXX will prepare and disseminate regular reports
(including financial information, costs, expenses and sales
information) to the board of directors of the PAA regarding the status
of each Project. (Notwithstanding the foregoing, without the written
approval of the board of directors of the PAA, XXX shall not commit, or
enter into any agreement on behalf of PAA, with respect to (i) the
incurrence by of any indebtedness for borrowed money by PAA; or (ii)
any investment of cash by PAA.
3. Compensation. In consideration for the services to be provided
hereunder, PAA will pay XXX management fees as follows:
(a) the greater of 0.5% of the Total Assets of PAA and $62,500, payable
on each of May 15, August 15, November 15 and March 31, based on the
financial statements of PAA at the end of the fiscal quarter
immediately preceding the payment date;
(b) an amount of the Net Profits of PAA for any Project equal to the
Preferred Return, if and to the extent and in the priority provided in
Section 5.3.3(a) of the Operating Agreement; and
(c) after the payment of the amount contemplated by Section 3(b) above
and any other amounts with priority over the payments hereunder
pursuant to the terms of the Operating Agreement, if any, an amount
equal to 20% of the Net Profits of the Company for any Project, if and
to the extent and in the priority provided in Section 5.3.3(a) of the
Operating Agreement.
As used herein, "Total Assets" means the amount of gross assets of the
Company as set forth on the applicable financial statements of the
Company at the end of the fiscal quarter immediately preceding the
payment date, as determined in accordance with generally accepted
accounting principles, consistently applied.
4. Termination. This Agreement shall commence on the date hereof and shall
continue until the "Closing of the books" (as such term is defined in
the Operating Agreement) on each of the Initial Projects (the
"Completion Date"), and shall automatically renew for successive one
year periods thereafter unless terminated by either party upon written
notice to the other at least thirty (30) days prior to the expiration
of the applicable anniversary of the Completion Date. Notwithstanding
the foregoing, Either PAA or XXX may terminate this Agreement as a
result of a material breach by the other party of the terms and
conditions of this Agreement by providing written notice to the
breaching party setting forth in reasonable detail the material breach
(a "Notice of Breach"). Upon receipt of a Notice of Breach, the
recipient shall have (i) ten days to cure such material breach if such
material breach relates to the failure to pay amounts due to the
non-breaching party pursuant to this Agreement (a "Payment Default");
or (ii) thirty days to cure such material breach if such material
breach relates to any material breach of this Agreement other than a
Payment Default. In addition, PAA may terminate this Agreement at any
time if Xxxx Xxxxxx withdraws as a member from XXX.
5. Activities. XXX shall have the exclusive right to provide all such
services as set forth in paragraph 2. as set forth above during the
term of this Agreement; provided, however, that nothing in this
Agreement shall be construed or applied to prevent XXX from engaging in
any other business or property management activities, including those
which may be similar to the business of PAA.
6. Indemnification. To the fullest extent permitted by law and by PAA's
Certificate and the Operating Agreement, PAA shall indemnify and hold
harmless XXX, its current and past members, managers, employees, agents
and assigns and any of their respective Affiliates, from and against
any and all liabilities, claims, damages, actions or proceedings
arising out of the activities of, or relating to, PAA.
7. Merger This Agreement contains the entire understanding of the parties
and there are no representations, warranties, covenants or undertakings
other than those expressly set forth herein.
8. Waivers. The failure of either party to insist in any one or more
instances upon the strict performance of any of the terms of this
Agreement by the other party, shall not be construed as a waiver or
relinquishment of such term or terms in the future, and the same shall
nevertheless continue in full force and effect.
9. Counterparts. This Agreement may be executed in any number of
counterparts, any one of which shall be deemed the original although
the others are not produced.
9. Invalidity. If any provision of this Agreement is held to be invalid or
unenforceable, all of the provisions shall nevertheless continue in
full force and effect.
10. Modifications. No amendment modification will be given force or effect
except if made in writing signed by the party against whom enforcement
is sought.
11. Assignment. This Agreement will not be assigned or transferred by
either party unless consent is given in writing by the other party but
such consent will not be unreasonably withheld.
12. Notices. All notices, consents and demands shall be given in writing by
return receipt requested. Notice shall be deemed given as of receipt or
refusal of registered or certified mail, or in the case of any other
acceptable communication, upon delivery to the addressee. Notices shall
be addressed as set forth below for the respective parties, provided
that if any party gives notice of a change of name or address. Notices
to that party shall thereafter be given as specified in that notice.
PARK AVE. ASSOC. MANAGEMENT LLC 000 X. Xxxx Xx.
Xxxxxxxxxx, XX 00000
With a copy in like manner to: Xxxx Xxxxxx
000 Xxxxxxxxx Xxxx Xxxx
Xxxx Xxxxx, Xxx Xxxx 00000
WQN, Inc.
00 Xxxxxxx Xxxxx,
Xxxxx 000
Xxxxxxxxxx, XX
00000 With a copy
to:
Xxxxx X. Xxxxx, Esq.
0000 Xxxxxxxxxx Xxxxx Xxxxx
Xxxxx 000
Xxxxxxxx, Xxx Xxxx 00000
Xxxxxxx X. Xxxxxx
Xxxxxx Xxxxx LLP
0000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx, XX 00000
PARK AVE. ASSOC. LLC 000 X. Xxxx Xx.
Xxxxxxxxxx, XX 00000
With a copy in like manner to: Xxxx Xxxxxx
000 Xxxxxxxxx Xxxx Xxxx
Xxxx Xxxxx, Xxx Xxxx 00000
WQN, Inc.
00 Xxxxxxx Xxxxx,
Xxxxx 000
Xxxxxxxxxx, XX
00000 With a copy
to:
Xxxxx X. Xxxxx, Esq.
0000 Xxxxxxxxxx Xxxxx Xxxxx
Xxxxx 000
Xxxxxxxx, Xxx Xxxx 00000
Xxxxxxx X. Xxxxxx, Esq.
Xxxxxx Xxxxx LLP
0000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx, XX 00000
13. No Third Party Beneficiaries. The parties hereto do not intend that
there are any third party beneficiaries of this Agreement.
14. Further assurances. Each party hereto shall, from time to time,
execute, acknowledge and deliver such further instruments and perform
such additional acts as the other party may reasonably request to
effectuate the intent of this Agreement.
15. Survival. The provisions of this Agreement will survive until such time
as the parties agree to terminate them in writing.
PARK AVE. ASSOC. MANAGEMENT LLC
By:_________________________________ Dated: October 31, 2005
Name: Xxxx Xxxxxx
Title: Managing Member
PARK AVE. ASSOC. LLC
By:_________________________________ Dated: October 31, 2005
Name: ______________________________
Title: Manager
By:_________________________________
Name: ______________________________
Title: Manager
By:_________________________________
Name: ______________________________
Title: Manager
