8.	Commitments, Contingencies and Related parties

Commitments and Contingencies

Presidential is not a party to any material legal proceedings. The Company may from time to time be a party to routine litigation incidental to the ordinary course of its business.

In the opinion of management, the Company’s Mapletree property is adequately covered by insurance in accordance with normal insurance practices.

A judgment of foreclosure was granted against PDL, Inc. & Associates, Limited Co-Partnership against the Hato Rey property in Puerto Rico. On September 23, 2013, U.S. Bank National Association, as trustee, as successor-in-interest to Bank of America, National Association, as trustee for the Registered Holders of GS Mortgage Securities Corporation II, Commercial Mortgage Pass-Through Certificates, Series 1998-C1, acting by and through Berkadia Commercial Mortgage LLC in its capacity as special servicer pursuant to the pooling and servicing agreement dated October 11, 1998 took possession of the Hato Rey property pursuant to the foreclosure judgment. We have been advised that the foreclosure sale price was less than the amount of the judgment. We have reported the Hato Rey property since March 31, 2012 as a discontinued operation.

On December 18, 2013, GS II SERIES 1998 C-1 HOME MORTGAGE PLAZA HATO REY LLC, (hereinafter “GS II”), a Delaware corporation, represented herein by U.S. Bank National Association, as Successor Trustee, successor-in-interest to Bank of America, N.A. (successor-by-merger to LaSalle National Bank Association, f/k/a LaSalle National Bank), as Trustee for the Registered Certificate-holders of GS Mortgage Securities Corporation II, Commercial Mortgage Pass-Through Certificates, Series 1998-C1, its Sole Member, represented in turn by Key Bank National Association, and Presidential Realty Corporation, entered into a Settlement and Release Agreement. Pursuant to the Settlement Agreement, GS II, the owner of the claims in the litigation and under the guarantees, PDL, Inc. and Presidential released each other and their respective officers, directors and affiliates from any claims each may have against the other, including any liability under the litigation and the guarantees. GS II also agreed to release the other guarantors from any claims GS II may have against those guarantors, including any liability under the litigation and the guarantees. GS II agreed to terminate the action against the guarantors, with prejudice, and in turn, Presidential Realty Corporation made a one-time payment of $200,000 to GS II.

Related Parties

Executive Employment Agreements

Nickolas W. Jekogian –On January 8, 2014, the Company and Mr. Nicholas W. Jekogian, Chairman and Chief Executive Officer of the Company, entered into an amendment to Mr. Jekogian’s employment agreement dated November 8, 2011. The amendment provides for (i) the extension of the employment term from May 3, 2013 to December 31, 2015, (ii) continuation of Mr. Jekogian’s base salary through the balance of the term at the rate of $225,000 per annum (subject to the continued deferral of the payment of the base salary until a Capital Event), (iii) removal of the $200,000 cap on the amount of any annual bonus that might be awarded Mr. Jekogian, (iv) the issuance to Mr. Jekogian of a “Warrant” to purchase 1,700,000 shares of the Company’s Class B Common Stock in exchange for the complete cancellation of $425,000 of the deferred compensation accrued under Mr. Jekogian’s employment agreement.

Alexander Ludwig –On January 8, 2014, the Company and Mr. Alexander Ludwig, a Director, President, Chief Operating Officer and Principal Financial Officer of the Company entered into an amendment to Mr. Ludwig’s employment agreement dated November 8, 2011. The amendment provides for (i) the extension of the employment term from May 3, 2013 to December 31, 2015, (ii) continuation of Mr. Ludwig’s base salary through the balance of the term at the rate of $225,000 per annum, (iii) removal of the $200,000 cap on the amount of any annual bonus that might be awarded Mr. Ludwig.

Deferred Compensation

In March 2015 the Company and the three former officer’s agreed in principal that if the Company were to refinance the Palmer Mapletree property, then they would accept, in lieu of the deferred compensation owed to them in the amount of $563,750 a cash payment of $50,000 each for a total of $150,000 from the proceeds of the refinancing and the right to receive restricted stock upon a registered public offering of the Company’s Class B Common Stock. The amount of restricted stock to be issued to each former officer would be the number of shares valued at the public offering price equal to the difference between the cash paid to them and the amount owed to them. While the Company is seeking to refinance the Palmer Mapletree property, the Company cannot guarantee that it will be able to obtain such refinancing.

During 2014 we paid the former officers of the Company $10,000 each or $30,000 in total to extend the due date of the payment from November 8, 2014 to November 8, 2016. The balance owed at December 31, 2014 and 2013 was $563,750 and $593,750, respectively and is included in other liabilities.

Property Management Agreement

On November 8, 2011, the Company and Signature Community Management (“Signature”, An entity owned by our CEO) entered into a Property Management Agreement pursuant to which the Company retained Signature as the exclusive, managing and leasing agent for the Company’s Mapletree Industrial Center property in Palmer, Massachusetts (the “Mapletree Property”). Signature receives compensation of 5% of monthly rental income actually received from tenants at the Mapletree Property. The property Management Agreement renewed for a one year term on November 8, 2014 and will be automatically renewable for one year terms until it is terminated by either party upon written notice. The Company incurred management fees of approximately $38,000 and $27,000 for the years ended December 31, 2014 and 2013, respectively.

Asset Management Agreement

On November 8, 2011, the Company entered into an Asset Management Agreement with Signature pursuant to which the Company engaged Signature to oversee the Mapletree property and our Hato Rey center in Hato Rey, Puerto Rico. Signature will receive an asset management fee of 1.5% of the monthly gross rental revenues collected for the properties. The Asset Management Agreement renewed for a one year term on November 8, 2014 and will be automatically renewable for one year terms until it is terminated by either party upon written notice. On September 8, 2013 the Asset Management fee associated with the Hato Rey Center was terminated due to the foreclosure and loss of the property. No additional fees are due for the Hato Rey Center. The Company incurred and owed asset management fees of approximately $11,000 and $51,000 for the years ended December 31, 2014 and 2013, respectively.

Sublease

The Company subleases their executive office space under a month to month lease with Signature. Either party may terminate the sublease upon 30 days prior written notice. On July 1, 2013 the Company moved their executive offices and amended its lease agreement with Signature for a monthly rental payment of $1,100 or $13,200 per year. All other terms of the sublease remained the same. For the years ended December 31, 2014 and 2013 the Company incurred approximately $13,200 and $9,099, respectively, in rent expense