Exhibit 10.3
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NEW ADMINISTRATIVE SERVICES AGREEMENT
ADMINISTRATIVE SERVICES AGREEMENT made effective as of the 1st day of
January, 2002, by and between XXXXXXXX HOSPITALITY LIMITED PARTNERSHIP and E&P
FINANCING LIMITED PARTNERSHIP (each, a "Partnership" and collectively, the
"Partnerships"), XXXXXXXX HOSPITALITY TRUST, INC. (the "Company") and XXXXXXXX
HOSPITALITY MANAGEMENT, INC., a Maryland corporation (the "Provider").
1. Administrative Services. During the term of this Agreement, the
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Provider shall, on behalf of the Company and the Partnerships: (i) provide
accounting services, including the preparation and submittal of all reports
required by the United States Securities and Exchange Commission and NASDAQ;
(ii) prepare and tally proxy statements; (iii) prepare the Company's monthly
income statements; (iv) prepare and disclose all obligations, bills and checks
of the Company; (v) provide administrative services, including preparing and
announcing press releases and handling investor relation services, such as
meetings with analysts and reporters; (vi) provide tax work papers and audit
work papers to the preparer of the tax returns and financial audit; (vii)
provide for the services of a portfolio manager to review hotel operations;
provide short-term and long-term forecasts to determine which hotels should
remain part of the Partnerships' portfolios and which hotels should be divested
from the portfolios, including analysis of physical, operational, marketing and
financial requirements necessary to maintain a hotel in the portfolio; and
provide portfolio analysis for prospective hotel purchases to determine if
prospective hotels should be added to one of the portfolios; (viii) provide
investor relations services including the review and comment on the format of
reports to be provided by the Company and the Partnerships to their investors;
determine methods for providing efficient communications and favorable
relationships among the Partnerships, the Company and their investors; and
develop systems to provide useful, timely and appropriate information to the
investors of the Company and the Partnerships and (ix) assist in providing
information and making presentations to lenders (the foregoing being referred to
herein as "Administrative Services").
2. Administrative Fee. As a fee for the services described in Section 1
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hereof ("Administrative Fee"), the Company will pay the Provider a monthly fee,
retroactive to November 1, 2001, in the amount of $70,833 payable by the tenth
day of the month following the month in which the services are performed. The
Company may discontinue the Administrative Services and terminate the
Administrative Fee at any time upon at least 30 days notice to the Provider.
3. Construction Services. During the term of this Agreement, at the
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direction of the Partnerships, the Provider will provide all services necessary
for the planning, bidding, procurement, oversight and coordination of any
development, construction, alteration, or capital improvement projects resulting
in capitalized additions to fixed assets ("Construction Projects") undertaken
with respect to the hotels owned by the Partnerships and managed by the Provider
or its affiliates. Construction Projects may be carried out under the
Partnership's supervision, without prejudice to the Provider's right to receive
the Construction Management Fee hereunder.
4. Construction Management Fee. As a fee for the services described in
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Section 3 hereof (the "Construction Management Fee"), the Partnership which owns
the hotel shall pay the Provider an amount equal to nine percent (9%) of the
actual documented third party costs for the Construction Project which have been
approved by the Partnership in writing in advance. The Construction Management
Fee shall be payable upon receipt by the Partnership of satisfactory
documentation as to the amount and timing of payments of the third party costs
for the Construction Project. Notwithstanding the foregoing, pursuant to the
Management Agreements between the Provider and its affiliate and subsidiaries of
the Partnership, the Provider and its affiliate will make or cause to be made
all repairs and maintenance items as shall be required in the normal and
ordinary course of operation of the Hotel and as shall be required to comply
with applicable law and franchisor standards, lender requirements and the
requirements of any insurance policies, without payment of a Construction
Management Fee hereunder. In addition, the Partnerships will reimburse the
Provider for the actual documented salary, benefits and travel expenses of the
Provider's employees directly related to providing the construction services
described in Section 3 above but in no event to exceed $150,000 in any Fiscal
Year (pro rated for any partial Fiscal Year). Notwithstanding the foregoing, the
fees for the current ongoing Construction Projects described on Exhibit A hereto
shall be as set forth in the Financial and Administrative Services Agreement
dated as of January 1, 2001, as amended, by and between the Company, the
Partnerships and the Provider.
5. Term. The term of this Agreement shall commence on the date hereof
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and terminate on September 30, 2003.
6. Assignment. The covenants and agreements contained herein shall be
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binding upon and inure to the benefit of the successors and assigns of the
respective parties hereto. Neither party may assign this Agreement without the
consent of the other party.
7. Severability. Each provision of this Agreement shall be considered
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severable, and if for any reason any provision that is not essential to the
effectuation of the basic purposes of the Agreement is determined to be invalid
and contrary to any existing or future law, such invalidity shall not impair the
operation of or affect those provisions of this Agreement that are valid.
8. Waivers. The waiver of either party of any breach of this Agreement
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shall not operate or be construed to be a waiver of any subsequent breach.
9. Governing Law. This Agreement shall be construed and enforced in
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accordance with the laws of the Commonwealth of Virginia, without regard to
principles of conflicts of law.
10. Termination. This Agreement shall terminate with respect to
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Construction Projects at any hotel owned by the Partnerships at such time as the
Management Agreement between the Provider and TRS Leasing, Inc. with respect to
such hotel terminates or is terminated.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.
PARTNERSHIPS:
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XXXXXXXX HOSPITALITY LIMITED
PARTNERSHIP
By: Xxxxxxxx Hospitality REIT Trust,
General Partner
By: /s/ Xxxxxx X. Xxxxxxxxxx
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Name: Xxxxxx X. Xxxxxxxxxx
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Title: President
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E&P FINANCING LIMITED PARTNERSHIP
By: E&P REIT Trust, General Partner
By: /s/ Xxxxxx X. Xxxxxxxxxx
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Name: Xxxxxx X. Xxxxxxxxxx
Title: President
PROVIDER:
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XXXXXXXX HOSPITALITY MANAGEMENT, INC.
By: /s/ Xxxxx X. Xxxxxxxx, Xx.
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Name: Xxxxx X. Xxxxxxxx, Xx.
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Title: Chairman
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COMPANY:
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XXXXXXXX HOSPITALITY TRUST, INC.
By: /s/ Xxxxxx X. Xxxxxxxxxx
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Name: Xxxxxx X. Xxxxxxxxxx
Title: President
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