PROPERTY MANAGEMENT AGREEMENT

(Tennessee)

[// GUIDANCE: Replace all bracketed text before execution. Defined terms appear in Initial Caps and are cross-referenced throughout.]

TABLE OF CONTENTS

I. Document Header
II. Definitions
III. Operative Provisions
IV. Representations & Warranties
V. Covenants & Restrictions
VI. Default & Remedies
VII. Risk Allocation
VIII. Dispute Resolution
IX. General Provisions
X. Execution Block

I. DOCUMENT HEADER

1. Parties. This Property Management Agreement (“Agreement”) is entered into as of [EFFECTIVE DATE] (the “Effective Date”) by and between:
   (a) [FULL LEGAL NAME OF PROPERTY OWNER], a [STATE & TYPE OF ENTITY] (“Owner”); and
   (b) [FULL LEGAL NAME OF PROPERTY MANAGER], a Tennessee-licensed real estate [broker | firm] holding License No. [LICENSE NUMBER] issued by the Tennessee Real Estate Commission (“TREC”) (“Manager”).

2. Recitals.
   A. Owner is the legal owner of the real property located at [PROPERTY ADDRESS] (the “Property”).
   B. Owner desires to engage Manager and Manager desires to accept such engagement to operate, manage, lease, and maintain the Property in accordance with the terms and conditions set forth herein.
   C. The parties intend for this Agreement to comply with the Tennessee Real Estate Broker License Act of 1973, Tenn. Code Ann. § 62-13-101 et seq., all applicable TREC Rules, and other applicable federal, state, and local laws.

3. Consideration. In consideration of the mutual covenants and promises herein, the sufficiency of which is acknowledged, the parties agree as follows.

II. DEFINITIONS

For purposes of this Agreement, the following terms shall have the meanings set forth below; terms defined in the singular include the plural and vice versa.

“Affiliate” – any entity or person directly or indirectly controlling, controlled by, or under common control with the referenced party.

“Applicable Law” – all present and future statutes, laws, ordinances, regulations, and lawful orders of governmental authorities with jurisdiction over the Property or the parties, including, without limitation, the Tennessee Real Estate Broker License Act, TREC Rules, the Tennessee Uniform Residential Landlord and Tenant Act, the Fair Housing Act, and all disclosure regulations.

“Gross Receipts” – all rents, fees, late charges, pet fees, parking fees, and other monies collected from tenants or others in connection with the Property, excluding (i) security deposits until applied, and (ii) insurance proceeds.

“Management Fees” – the fees payable to Manager under Section 3.3.

“Service Contracts” – third-party contracts for utilities, repairs, maintenance, and other services relating to the Property.

“Trust Account” – a bank account established and maintained by Manager in accordance with Tenn. Code Ann. § 62-13-321 and TREC Rule 1260-02-.09 for the deposit and disbursement of client funds.

III. OPERATIVE PROVISIONS

3.1 Engagement & Scope of Services

(a) Owner hereby appoints Manager as exclusive agent to manage, operate, and lease the Property.
(b) Services include, without limitation: marketing, tenant screening, lease execution, rent collection, accounting, maintenance coordination, compliance with Applicable Law, and other customary property management duties.
[// GUIDANCE: Optional schedules may be attached for detailed service matrices.]

3.2 Term

Initial Term: [NUMBER] years commencing on the Effective Date (the “Initial Term”).
Automatic Renewal: Unless either party delivers written notice of non-renewal at least 60 days before the end of the then-current term, the Agreement shall automatically renew for successive one-year periods (each a “Renewal Term”).

3.3 Compensation

(a) Management Fee. Manager shall receive a monthly management fee equal to [PERCENTAGE]% of Gross Receipts, payable on or before the 10th day of each calendar month.
(b) Leasing Fee. For each new lease, Manager shall receive [AMOUNT OR PERCENTAGE] of the first full month’s rent.
(c) Other Fees. [DESCRIBE—e.g., renewal fees, maintenance oversight fees, etc.]

3.4 Budgets & Expenditures

(a) Annual Budget. Manager shall prepare and submit to Owner for approval an annual operating budget at least 30 days prior to the start of each calendar year.
(b) Expenditure Limits. Manager shall not incur any single expense exceeding US $[THRESHOLD] without Owner’s prior written consent, except for emergency repairs to protect life, safety, or Property integrity.

3.5 Banking & Trust Accounts

(a) Trust Account. All tenant security deposits, advance rents, and other client funds shall be deposited into a Trust Account titled “[OWNER NAME] – Trust,” maintained at a federally insured financial institution located in Tennessee.
(b) Segregation & Records. Manager shall not commingle Trust Account funds with Manager’s operating funds and shall maintain complete and accurate records in compliance with Tenn. Code Ann. § 62-13-321 and TREC Rule 1260-02-.09.
(c) Monthly Statements. On or before the 15th day of each month, Manager shall furnish Owner with a detailed statement of receipts, disbursements, and Trust Account balances.

3.6 Authority of Manager

Manager is authorized, on behalf of Owner, to:
(i) sign and deliver leases on TREC-approved forms for terms not exceeding [MAX LEASE TERM] months;
(ii) institute and pursue legal actions (including detainer actions) in Owner’s name;
(iii) contract for utilities and Service Contracts; and
(iv) perform all acts reasonably necessary to fulfill Manager’s duties under this Agreement.

[// GUIDANCE: Local counsel may adjust authority limits to match Owner’s risk profile.]

3.7 Owner’s Responsibilities

Owner shall:
(a) maintain adequate property and liability insurance (see Section 7.3);
(b) provide funds necessary to meet Property obligations when Gross Receipts are insufficient;
(c) timely review and approve budgets and major expenditures; and
(d) disclose all known material defects and environmental hazards.

IV. REPRESENTATIONS & WARRANTIES

4.1 By Manager

(a) Licensing. Manager is duly licensed by TREC and is in good standing.
(b) Compliance. Manager has not been cited for, and is not under investigation for, any violation of the Tennessee Real Estate Broker License Act or TREC Rules.
(c) Authority. Manager has full power and authority to enter into and perform this Agreement.

4.2 By Owner

(a) Title & Authority. Owner holds marketable title to the Property and has full authority to engage Manager.
(b) Compliance. The Property is, to Owner’s knowledge, in material compliance with Applicable Law.
(c) Accuracy of Information. All information provided by Owner to Manager is true, correct, and complete in all material respects.

4.3 Survival

All representations and warranties shall survive termination of this Agreement for a period of [SURVIVAL PERIOD] years.

V. COVENANTS & RESTRICTIONS

5.1 Licensing & Regulatory Compliance. Manager shall maintain all required licenses and strictly observe all trust-accounting, signage, record-keeping, disclosure, and advertising rules promulgated by TREC.

5.2 Fair Housing. Manager shall comply with federal, state, and local fair housing laws and shall implement nondiscriminatory policies.

5.3 Disclosure Obligations.
(a) Lead-Based Paint. Manager shall provide federally required lead-based paint disclosures for properties built prior to 1978.
(b) Agency Disclosure. Manager shall deliver TREC Form RF201 or its successor to prospective tenants as required.
(c) Other Disclosures. Manager shall timely make all disclosures mandated by Applicable Law (e.g., radon, flood, methamphetamine, or sex offender registry where applicable).

5.4 Books & Records. Manager shall maintain books, records, and supporting documentation for at least five (5) years and shall make them available for inspection by Owner on reasonable notice.

5.5 Audits. Owner may, at Owner’s expense, audit Manager’s books and records relating to the Property upon ten (10) business days’ notice no more than twice per calendar year.

VI. DEFAULT & REMEDIES

6.1 Events of Default
(a) Failure to Perform. Material breach of any covenant, obligation, representation, or warranty that remains uncured for ten (10) business days after written notice (or such longer period as may be reasonably required if the breach is not reasonably curable within ten days and the breaching party diligently pursues cure).
(b) Insolvency. Appointment of a receiver, assignment for the benefit of creditors, or commencement of bankruptcy proceedings by or against a party.
(c) License Action. Suspension, revocation, or expiration without renewal of Manager’s real estate license.

6.2 Remedies
Upon an Event of Default, the non-defaulting party may, in addition to any other rights under this Agreement or at law:
(i) terminate this Agreement immediately on written notice;
(ii) pursue all damages, including consequential damages except as limited by Section 7.2;
(iii) seek injunctive relief; and
(iv) recover reasonable attorneys’ fees and costs.

6.3 Cumulative Remedies
All remedies are cumulative and may be exercised concurrently or separately.

VII. RISK ALLOCATION

7.1 Indemnification by Manager

Manager shall indemnify, defend, and hold harmless Owner, its Affiliates, and their respective agents, employees, officers, and directors (collectively, “Owner Indemnitees”) from and against any and all claims, damages, losses, liabilities, penalties, fines, costs, and expenses (including reasonable attorneys’ fees) arising out of or related to:
(i) Manager’s gross negligence, willful misconduct, or breach of this Agreement;
(ii) violations of Applicable Law by Manager; and
(iii) misapplication of Trust Account funds.

7.2 Limitation of Liability

Except for (a) Manager’s indemnification obligations under Section 7.1, (b) claims arising from Manager’s fraud, gross negligence, or willful misconduct, and (c) amounts covered by insurance, Manager’s aggregate liability to Owner under this Agreement shall not exceed the total Management Fees actually paid to Manager during the twelve (12) months immediately preceding the event giving rise to liability.

7.3 Insurance

(a) Owner shall maintain, at a minimum, (i) commercial general liability insurance with limits of not less than US $[LIMIT] per occurrence and US $[AGGREGATE] aggregate, and (ii) property insurance on a replacement-cost basis.
(b) Manager shall be named as an additional insured on Owner’s liability policy.
(c) Manager shall maintain professional liability (errors & omissions) insurance with limits of not less than US $[LIMIT] per claim.

7.4 Force Majeure

Neither party shall be liable for failure to perform its obligations (other than payment obligations) when such failure is caused by events beyond its reasonable control, including acts of God, war, terrorism, labor disputes, government action, epidemics, or natural disasters, provided the affected party gives prompt written notice and resumes performance as soon as practicable.

VIII. DISPUTE RESOLUTION

8.1 Governing Law

This Agreement and any dispute arising hereunder shall be governed by and construed in accordance with the laws of the State of Tennessee, without regard to its conflict-of-laws principles.

8.2 Forum Selection

Subject to Section 8.3, the parties consent to exclusive jurisdiction and venue in the state courts located in [COUNTY], Tennessee, and waive any objection to inconvenient forum.

8.3 Arbitration (Optional)

[SELECT ONE:
☐ The parties agree that any dispute shall be resolved exclusively by binding arbitration administered by the American Arbitration Association under its Commercial Arbitration Rules. Judgment on the award may be entered in any court of competent jurisdiction.
☐ The parties decline arbitration.]

[// GUIDANCE: Strike the inapplicable option before execution.]

8.4 Jury Trial Waiver (Optional)

[IF ELECTED] EACH PARTY WAIVES ITS RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING ARISING OUT OF THIS AGREEMENT.

8.5 Injunctive Relief

Nothing in this Section shall limit either party’s right to seek temporary, preliminary, or permanent injunctive relief in a court of competent jurisdiction to prevent irreparable harm.

IX. GENERAL PROVISIONS

9.1 Amendment & Waiver. No amendment or waiver of any provision shall be effective unless in writing and signed by both parties. A waiver of any breach shall not constitute a waiver of any other or subsequent breach.

9.2 Assignment. Neither party may assign this Agreement without the prior written consent of the other, except that Owner may assign to a purchaser of the Property with notice to Manager.

9.3 Successors & Assigns. This Agreement shall bind and benefit the parties and their respective successors and permitted assigns.

9.4 Severability. If any provision is held unenforceable, the remaining provisions shall remain in full force, and the unenforceable provision shall be reformed to the minimum extent necessary to render it enforceable.

9.5 Entire Agreement. This Agreement, together with any exhibits and schedules, constitutes the entire understanding of the parties and supersedes all prior agreements, whether written or oral, relating to the subject matter.

9.6 Counterparts; Electronic Signatures. This Agreement may be executed in multiple counterparts, each of which shall be deemed an original. Signatures transmitted electronically (e.g., PDF, DocuSign) shall be deemed original signatures and fully enforceable.

9.7 Notices. All notices shall be in writing and deemed given (i) when delivered personally, (ii) one (1) business day after deposit with a nationally recognized overnight courier, or (iii) three (3) business days after mailing by certified mail, return receipt requested, to the addresses set forth below or such other address as either party may designate in writing.

X. EXECUTION BLOCK

IN WITNESS WHEREOF, the parties have executed this Property Management Agreement as of the Effective Date.

OWNER:

[FULL LEGAL NAME OF OWNER]
By: _____
Name: ____
Title: _____
Date: _________

MANAGER:

[FULL LEGAL NAME OF PROPERTY MANAGER]
TREC License No. [LICENSE NUMBER]
By: _____
Name: ____
Title: _____
Date: _________

[NOTARY BLOCK IF REQUIRED BY LENDER OR LOCAL CUSTOM]

[// GUIDANCE: Attach the following as applicable:
• Exhibit A – Legal Description of Property
• Exhibit B – Management Services Matrix
• Exhibit C – Approved Annual Budget
• Exhibit D – Insurance Certificates]