This Joint Venture Agreement ("Agreement") is made and entered into by and between Unconventional REI LLC, a limited liability company ("the Company"), and the undersigned investor
("Investor"). The purpose of this Agreement is to set forth the terms and conditions under which the Investor will provide qualified leads to the Company in exchange for a portion of the net assignment fee.
The purpose of this Agreement is to outline the terms and conditions under which investors who bring qualified leads to the Company will be compensated. This Agreement covers all leads brought to the Company, ensuring that any lead is automatically covered under these terms.
• Simplified Process: Investors have a single focus—finding and qualifying motivated sellers. By honing this one skill, investors can become experts in identifying leads that are
likely to close, avoiding the many pitfalls that new investors typically face.
• Quick Start: New investors can start making money quickly without having to navigate the traditional barriers, such as setting up an LLC, building a team, or making expensive mistakes. The Company handles 90% of the process, allowing investors to focus on the most crucial part of the deal—finding motivated sellers.
• Access to a Functional Team: Investors plug directly into a seasoned team that handles all other aspects of the deal, including underwriting, negotiation, follow-up calls, finding buyers, and closing the deal. This support system reduces the learning curve and helps investors avoid common pitfalls.
• Risk Mitigation: The Company's underwriting ensures that only profitable deals are pursued, protecting investors from getting bad deals under contract. This mitigates the risk for investors and increases the likelihood of successful deal closures.
• Resource Optimization: Investors don’t need to spend time or money on learning complex exit strategies, sales techniques, or networking. The Company provides these resources, allowing investors to focus on what they do best—finding motivated sellers.
a. Net Assignment Fee: The amount remaining after the following costs are deducted: underwriting costs, transaction coordinator fees, disposition fees, and management fees.
b. Qualified Lead: A lead that includes the following information: motivation, timeline, price, and condition.
c. Motivation: Motivation refers to the underlying pain points driving the seller's decision to sell, not merely the surface-level reason.
• Reason: The apparent or stated cause for selling, such as moving cross-country for a new job.
• Pain Points: The deeper emotional and financial distress or challenges uncovered through probing questions. These might include factors like financial hardship, fear of foreclosure, stress from creditor harassment, or strain on family relationships.
• A Qualified Lead must reflect true motivation by identifying these deeper pain points, as they are critical in determining the seller’s urgency and willingness to accept a discounted offer.
a. Lead Qualification: The Investor must provide leads with the four pillars of information (motivation, timeline, price, and condition). Failure to provide complete information could result in deductions from their portion of the assignment fee.
b. Additional Support: If the Investor requires additional coaching, mentoring, or other resources not initially agreed upon, the compensation structure changes to 10% for the first deal, 20% for the second deal, and 30% for subsequent deals.
a. Payment Terms: The Company agrees to pay the Investor 10-30% of the net assignment fee at the close of escrow, depending on the level of support required.
b. Purchase Option: Investors are encouraged to submit requests to purchase any property that the Company has under contract, whether they brought the lead or not. The Company welcomes these requests as they can expedite the disposition process. All such requests will be reviewed and approved at the discretion of the Company’s management.
a. Incomplete Information: If any of the four pillars of information are missing or incomplete, deductions will be made from the Investor's share of $100 per missing piece or inadequate depth of information.
b. Cost Sharing: Essential costs (underwriting, transaction coordination, etc.) are covered before the net assignment fee is calculated.
a. Confidentiality: Both parties agree to keep all deal-related information confidential and not disclose it to any third party without prior written consent. However, the Company reserves the right to disclose necessary information to third-party disposition, marketing companies, or resources if such disclosure is in the interest of closing the deal. The Investor acknowledges and agrees that such disclosures are a regular part of the Company’s business operations.
b. Non-Circumvention and Interference: The Investor is encouraged to maintain and foster positive relationships with sellers, realtors, and other parties involved in the transaction. However, the Investor agrees not to engage in any actions that could interfere with, disrupt, or sabotage the Company’s efforts to close any deal. This includes, but is not limited to, any actions or communications that could cause the seller to back out of the deal or otherwise impede the successful closing of the transaction.
• If the Investor’s actions, whether intentional or negligent, result in the deal failing to close, the Investor shall be held legally liable for all losses, damages, or costs incurred by the Company. This includes, but is not limited to, the full value of the lost assignment fee, re-marketing costs, legal fees, and any additional damages as determined by the court.
a. Transfer of Ownership: Once a lead is submitted to the Company by the Investor, the lead becomes the sole property of the Company. This transfer of ownership allows the Company to invest its full resources, efforts, and strategies into bringing the lead to a successful close.
b. Request for Withdrawal: If, for any reason, the Investor wishes to withdraw the lead and take it elsewhere, such a request must be made in writing and approved by the Company’s management. The Company reserves the right to accept or deny such a request at its sole discretion.
a. Termination Clause: Either party may terminate this Agreement with 7 days written notice. Termination shall not affect any obligations that accrued prior to termination.
b. Survival of Obligations: The confidentiality obligations and any other provisions intended to survive termination shall remain in effect.
Each party hereto hereby agrees that in the event of any dispute arising out of, in connection with, or by reason of this Contract, such dispute shall be resolved by arbitration before the American Arbitration Association located in Phoenix, AZ. Arbitration proceedings may be initiated by any signatory to this Contract by giving the other parties hereto notice thereof. The arbitrator’s award in any such proceeding shall be final and binding, and a judgment upon such award may be enforced by any court of competent jurisdiction. Each signatory hereby agrees to submit to the jurisdiction of any state or federal court sitting in the State Capitol city in the State where the Property resides, in any action or proceeding arising out of or relating to the enforcement of the arbitration provisions in this Contract. Each party shall choose a single arbitrator and the two so chosen shall choose a third arbitrator. Either party may be represented by legal counsel. The decision of the arbitrators shall be final and conclusive and the right to appeal is hereby waived. If either party herein brings an action to enforce the terms hereof or declare rights hereunder, the prevailing party in any such actions, or trial or appeal, shall be entitled to recover from the non-prevailing party all legal costs, reasonable attorney’s fees, expert witness fees, fees paid to investigators, and arbitration costs.
a. Entire Agreement: This Agreement constitutes the entire understanding between the parties concerning the subject matter and supersedes all prior discussions. b. Amendments: Any amendments to this Agreement must be in writing and signed by both parties.
IN WITNESS WHEREOF, the parties hereto have executed this Joint Venture Agreement as of the day and year first above written.
Unconventional REI LLC
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Investor
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