| Related-Party Transactions | 11. Related-Party
Transactions
FUR Advisors -
Base Asset Management Fee –
In connection with the adoption of the plan of liquidation, the
Trust accrues costs it expects to incur through the end of the
liquidation. In this regard, at June 30, 2016 the Trust has
accrued, based on its estimates of the timing and amounts of
liquidating distributions to be paid to Common Shareholders, base
management fees of $4,103,000, exclusive of the $1,298,000 included
in related party fees payable. The amount is included in
liabilities for estimated costs in excess of estimated receipts
during liquidation. Actual fees incurred may differ significantly
from these estimates due to inherent uncertainty in estimating
future events.
Incentive Fee / Termination Fee -
With respect to the termination fee, it is only payable if there is
(i) a termination of the Advisory Agreement for any reason
other than for cause (as defined) by the Trust or with cause by the
Trust’s Advisor, (ii) a disposition of all or
substantially all of the Trust’s assets, or (iii) an
election by the Trust to orderly liquidate the Trust’s
assets. The termination fee, if payable, is equal to the lesser of
(i) the base management fee paid to the Trust’s Advisor
for the prior twelve month period or (ii) either (x) in
the case of a termination of the Advisory Agreement, 20% of the
positive difference, if any between (A) the appraised net
asset value of the Trust’s assets at the date of termination
and (B) the threshold amount less $104,980,000, or (y) in
the case of a disposition or liquidation, 20% of any dividends paid
on account of the Trust’s Common Shares at such time as the
threshold amount is reduced to $104,980,000, which, as of
June 30, 2016, will be achieved at such time as aggregate
distributions of approximately $7.24 per Common Share in excess of
the Growth Factor have been paid. For example, if the Trust had
been liquidated at June 30, 2016, the termination fee would
only have been payable if total dividends of approximately $7.24
per Common Share had been paid, and then only until the total
termination fee paid would have equaled $9,496,000 (the base
management fee for the twelve months prior to the approved plan of
liquidation), which amount would be achieved when total dividends
paid per Common Share equaled approximately $8.29. At June 30,
2016 it is estimated that the Advisor will be entitled to a
termination fee of $9,496,000 in connection with the liquidation.
This amount has been accrued and is included in liabilities for
estimated costs in excess of estimated receipts during
liquidation.
Property Management and Construction Management -
The following table sets forth the fees and reimbursements paid by
the Trust for the six months ended June 30, 2016 and 2015 to
FUR Advisors and Winthrop Management (in thousands):
For the Three Months Ended
For the Six Months Ended
June 30, 2016 June 30, 2015 June 30, 2016 June 30, 2015
Base Asset Management Fee (1) $ 1,298 $ 1,635 $ 2,718 $ 3,319
Property Management Fee 174 261 358 545
Construction Management Fee 3 66 3 97
$ 1,475 $ 1,962 $ 3,079 $ 3,961
(1) Includes fees on third party
contributions of $3 and $7 for the three months ended June 30,
2016 and 2015, respectively, and of $10 and $14 for the six months
ended June 30, 2016 and 2015, respectively.
At June 30, 2016 $1,298,000 payable to FUR Advisors and
$96,000 payable to Winthrop Management were included in related
party fees payable. |
