ASSET MANAGEMENT AGREEMENTS; PROPERTY MANAGEMENT AGREEMENTS
Each of the Realty Trusts has entered into a separate Asset Management Agreement (the “Asset Management Agreements”) with a separate affiliate of The Molasky Group of Companies (the “Asset Manager”). The terms of the Asset Management Agreements are co-terminus with the terms of the corresponding Government Leases.
Pursuant to the Asset Management Agreements, the Asset Managers perform the following services on behalf of the Realty Trusts:
(i) overseeing income and expenses and funding any cash flow shortfalls, to the extent of the positive cash flow generated by the Properties on an aggregate basis during the immediately preceding twelve month period,
(ii) negotiating an extension of the Government Lease or a new lease at the end of the term of the Government Lease,
(iii) negotiating a refinancing of the mortgage loans at their maturity dates (coterminous with the terms of the Government Leases)
(iv) performing any construction required under the Government Lease. In exchange for these services and the services of the Asset Manager under the Property Management Agreement (defined below), the Asset Manager is compensated by being entitled to retain any positive cash flow from the Property during the term of the Government Lease.
Each of the Realty Trusts has entered into a Property Management Agreement (the “Property Management Agreement”) with the respective Asset Manager for its Property. The terms of the Property Management Agreements are co-terminus with the terms of the corresponding Government Leases. Pursuant to the Property Management Agreements, the Asset Managers perform customary property management services on behalf of the Realty Trusts, including administration, maintenance, lease and loan servicing, reporting, budgeting, managing insurance and similar duties. The Asset Managers do not receive separate compensation for such services, but instead are compensated under the Asset Management Agreements .
Each Asset Manager is an affiliate of PH LLC, a Nevada limited liability company doing business as The Molasky Group of Companies and is an affiliate of most of the sellers which sold the Realty Trusts to the Holding Trust. The Asset Managers were formed for the purpose of this transaction. To assure continuity of management and results of operations, it is anticipated that the Asset Managers will retain the same individuals currently performing the functions of the “Landlords” under the Government Leases. For more information regarding The Molasky Group of Companies, you may access its website at