Developer Compensation Clause Samples
The Developer Compensation clause defines how and when a developer will be paid for their work under an agreement. It typically outlines the payment structure, such as hourly rates, fixed fees, or milestone-based payments, and may specify the timing of payments and any conditions for receiving them, like completion of deliverables or approval by the client. This clause ensures both parties have a clear understanding of financial expectations, reducing the risk of disputes over payment and providing security for the developer's remuneration.
Developer Compensation a. As compensation for the services to be rendered by Developer pursuant to the terms of this Agreement, Owner shall pay to Developer a development fee equal to NINE HUNDRED FORTY EIGHT THOUSAND AND NO/100 DOLLARS ($948,000.00) (the “Development Fee”), which shall be payable by wire transfer or other immediately available funds as follows:
1. An amount equal to 25% of the Development Fee (TWO HUNDRED THIRTY THOUSAND AND NO/100 DOLLARS $237,000.00) shall be paid to Developer upon commencement of construction of the Project;
2. Following the commencement of construction of the Project, an amount equal to 50% of the Development Fee (FOUR HUNDRED SEVENTY FOUR THOUSAND AND NO/100 DOLLARS $474,000.00) shall be paid to Developer in equal monthly installments over a seventeen (17) month period; and
3. An amount equal to 25% of the Development Fee (TWO HUNDRED THIRTY THOUSAND AND NO/100 DOLLARS $237,000.00) shall be paid to Developer upon completion of the Project (as determined by the certified document of the architect or design professional) and the Project achieving, through lease-up, a Debt Service Coverage Ratio (as that term is defined in that certain Construction Loan Agreement by and between Fifth Third Bank and the Owner) of 1.20 to 1.00 (collectively, the “Stabilization”). Notwithstanding anything to the contrary contained herein, (a) if the Owner's construction lender does not permit the aforesaid fees to be paid as draws under the construction loan, then such amounts shall accrue as provided in the JV's Operating Agreement, or (b) if the Owner causes the Property to undergo a Capital Event prior to Stabilization, or any other termination event under Paragraph 4, the Owner shall, within thirty (30) days after such Capital Event, or other termination event, pay, pro-rata to the amount of development constructed as of the date of the Capital Event or other termination event, any outstanding, unpaid portion of the Development Fee which has not been paid to Developer.
b. Owner shall also reimburse Developer for commercially reasonable out-of-pocket costs and expenses incurred by Developer for travel, administration, meals, etc., according to the approved Total Project Budget, subject to the draw schedule imposed and/or approved by the Owner and its construction lender. fu the event any amounts payable hereunder to Developer are not delivered to Developer when due and payable, interest shall accrue on such outstanding amount at eight percent (8%) per annum f...
Developer Compensation. Developer will be reimbursed by the City an aggregate amount of $140,000 for initial costs associated with the expenses incurred for the due diligence period as described in Section 4, in four installments on the following performance milestone schedule: --First payment of $25,000 upon execution of this Development Agreement. --Second payment of $40,000 upon completion of two community meetings and submission of the application for first re-zoning of an initial phase. --Third payment of $25,000 upon first progress report submitted to the City. --Fourth payment of $50,000 upon first letter of intent from a prospective tenant/buyer/business is submitted to the City. The City shall be reimbursed this $140,000 amount from increment generated from the project pursuant to the approved tax increment finance plan. Both parties recognize the Developer will also incur additional expenses including but not limited to: site and development marketing activities, legal and other due diligence expenses, design development fees and expenses, and developer fees. Said amount shall be an eligible reimbursement from tax increment proceeds under the approved tax increment finance plan to the extent permitted by law; and will be remitted to the Developer commensurate with other tax increment proceeds associated with financing the development of the subject parcel pursuant to the approved tax increment finance plan.
Developer Compensation a. DEVELOPER shall charge Customer for Deliverables and shall be paid by Customer in accordance with the Plug-N-Run package and fee schedule.
Developer Compensation