NEW YORK REIT LIQUIDATING LLC
FORM
10-K
DECEMBER 31, 2018
Advisory Agreement – Advisor
On December 19, 2016 the Predecessor entered into an agreement (the “Advisory Agreement”) with Winthrop Advisor, pursuant to
which Winthrop Advisor served as the Predecessor’s exclusive advisor with respect to all matters primarily related to any plan of liquidation and dissolution of the Company and as a consultant to the Board on certain other matters during the
period from January 3, 2017 through March 7, 2017 and is serving as exclusive advisor to the Company from and after March 8, 2017.
The Predecessor and the Winthrop Advisor entered into a second amendment to the Advisory Agreement on June 8, 2018 and a third amendment
to the Advisory Agreement on August 7, 2018, and the revised terms on the Advisory Agreement following these amendments are described below.
The term of the Advisory Agreement ended on the earlier of the effective date of the conversion of the Predecessor to a liquidating entity
(the “Liquidation Date”), or December 6, 2018, six months from the date of the second amendment. The term of the Advisory Agreement will automatically renew for a
one-month
period on the
expiration of the term or any renewal term, unless terminated by a majority of the Board of Managers or the Winthrop Advisor, upon written notice 45 days before the expiration of the term or any renewal term and will automatically terminate at the
effective time of the final disposition of the assets held by the Liquidating LLC. The Advisory Agreement may be terminated upon 15 days written notice by a majority of the Board of Managers if our chief executive officer resigns or is otherwise
unavailable to serve as the Predecessor’s chief executive officer for any reason and the Winthrop Advisor has not proposed a new chief executive officer acceptable to a majority of the Board of Managers. On July 12, 2018, the
Company’s independent directors voted unanimously to appoint John Garilli as Chief Executive Officer upon the resignation of Wendy Silverstein from the position and accordingly did not exercise the Company’s right to terminate the Advisory
Agreement.
Because the Predecessor converted to the LLC effective at 5:00 p.m. Eastern Time on November 7, 2018, November 7,
2018 is the Liquidation Date, and, accordingly, the current term of the Advisory Agreement expired on November 7, 2018. Since no notice of termination of the Advisory Agreement has been received by the either party, the Advisory Agreement
automatically renewed at the end of the current term for a term ending December 7, 2018 and will thereafter continue to automatically renew for additional
one-month
terms unless otherwise terminated as
described above.
On each of January 3, 2017 and February 1, 2017, the Predecessor paid Winthrop Advisor a fee of $500,000 in
cash as compensation for advisory services and consulting services rendered prior to March 1, 2017.
Beginning on March 1, 2017,
and continuing through the Liquidation Date, the Predecessor paid Winthrop Advisor an asset management fee equal to 0.325% per annum of the cost of assets (as defined in the Advisory Agreement) up to $3.0 billion and 0.25% per annum of the cost
of assets in excess of $3.0 billion.
In determining the Cost of Assets (as defined in the Advisory Agreement) for purposes of
calculating the management fee payable to the Winthrop Advisor, the cost of the Viceroy Hotel was, for each month from and after April 2018, deemed to equal its then-current book value.
Beginning with the fiscal quarter ending September 30, 2018 and ending on the Liquidation Date, the Predecessor paid Winthrop Advisor a
supplemental fee of $25,000 per quarter (prorated for any partial quarter) in addition to the base management fee.
Following the
Liquidation Date, the Company will pay to the Winthrop Advisor a monthly fee of $100,000 and a supplemental fee of $50,000 per quarter (prorated for any partial quarter) for any period that the principal
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