7.2 Association Insurance. Association will maintain at its sole expense a policy of comprehensive general liability, Directors and Officers, worker’s compensation , computer fraud and funds transfer fraud (if not included in the fidelity or liability policy) and property insurance (as necessary) in accordance with the Association's Governing Documents and applicable California State codes. 7.3 Additional Insured. Association shall name Agent as an additional named insured on the Association's policies of comprehensive general liability and directors ’ and officers’ insurance and said insurance policies will cover Agent for any and all claims and losses indemnified by Association pursuant to Section 7.5. Agent will be provided with insurance certificates identifying Agent as additional named insured showing the amount of coverage to be furnished to the Agent. 7.4 Fidelity Insurance. In the mutual interest of Association and Agent, both Parties agree that fidelity insurance coverage protecting Association funds shall be placed with the Agent’s Master Fidelity Program, so long as such coverage is available. The limits of the Master Fidelity shall be no less than three (3) months total assessment income. 7.5 Insurance Responsibilities. Agent will maintain reasonable communication with Association's insurance agent and will assist the Board in reviewing and renewing insurance coverage, including solicitation of bids for such coverage. The Board of Directors is solely responsible for maintaining insurance coverage for the Association, and for ensuring the adequacy of coverage. 7.6 Indemnification by Association. Association shall indemnify, defend at its sole cost, and hold harmless Agent and its employees, agents, officers and directors from and against any and all claims, demands, losses, costs, expenses, obligations, liabilities, judgments, orders and damages, including interest, penalties and attorney's fees, that Agent shall incur or suffer which arise, result from, or relate to the performance by Agent of its duties under this Agreement, except for the willful misconduct or negligence of Agent. This provision shall survive any termination of this Agreement. 7.7 Indemnification by Agent. Agent will be responsible only for any willful misconduct, gross negligence where such liability is due to the sole conduct of Agent and/or its employees in the performance of its duties/Services under this Agreement.
8. COMPENSATION
8.1 Scope of Fee. In consideration of Agent's acceptance of its appointment hereunder and the performance of Services as set forth herein, the compensation to which the Agent will be entitled will consist of fees for basic Services ( the “ Base Fee ” ) which are considered due upon the Commencement Date of this Agreement, but are paid monthly, along with those fees and costs for special or extraordinary services as set forth in Exhibit A.
A. Agent shall be paid in advance on the first day of each month without prior Association approval, upon the first close of escrow in the Association. Agent's base monthly will be $4,950.
B. The Base Fee, as defined, shall be net to Agent and is exclusive of the Association's operating expenses and costs. The Base Fee shall be superseded by the adoption of a new annual association budget indicating an adjusted Base Fee for management Services. Adoption of the annual budget by the Association's Board of Directors shall constitute an approval of a Base Fee change under this Agreement, but in no event shall the Base Fee for any year be less than the amount stated in A of this section.
8.2 Agent’s Fees and Costs. Any Base Fees and costs due the Agent by Association pursuant to the terms of this Agreement will be paid promptly each month on the first of each month unless such Base Fee or other cost is contested in writing by the Association. Any uncontested monies due and billed and not paid to Agent by the fifteenth (15th) of each month will carry a one percent (1%) per month late fee which will be added to the balance due and will be subject to further late charges until paid. Interest at five percent (5%) to be charged thirty (30) days after any amounts are delinquent.
Professional Management Agreement Village Racquet Club Association and Prime Association Services, Inc. Page 8 of 14
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