1
EXHIBIT 10.11
SERVICES AGREEMENT
This Services Agreement is made as of the 1st day of July, 2000 by and
among INLAND REAL ESTATE CORPORATION, a Maryland corporation (the "REIT") and
INLAND REAL ESTATE INVESTMENT CORPORATION ("IREIC"), INLAND PAYROLL SERVICES,
INC. ("IPS"), INLAND COMPUTER SERVICES, INC. ("ICS"), INLAND RISK AND INSURANCE
MANAGEMENT SERVICES, INC. ("IRIM"), INLAND COMMUNICATIONS, INC. ("ICOM"),
INVESTORS PROPERTY TAX SERVICES, INC. ("IPTS") and INLAND OFFICE MANAGEMENT,
INC. ("IOM"). (IREIC, IPS, ICS, IRIM, ICOM, IPTS and IOM are referred to herein
collectively as "Service Providers").
RECITALS
A. The REIT is in the business of the ownership, operation and development
of commercial real estate. Concurrently herewith, the REIT has acquired, through
its subsidiaries and pursuant to an Agreement and Plan of Merger (the "Merger
Agreement"), all of the stock of Inland Real Estate Advisory Services, Inc. (the
"Advisor") and Inland Commercial Property Management, Inc. ("ICPM"), which were
affiliates of the Service Providers. Pursuant to the Merger Agreement, the
parents of the Advisor and ICPM agreed to make available to the REIT the
services of the Service Providers on the general terms as described herein.
B. IREIC has in the past provided investor relations services to the REIT,
and certain of IREIC's personnel have also provided general administrative and
advisory services to the REIT, and IREIC is willing to continue to provide such
services to the REIT on the terms as contained herein.
C. IPS has in the past provided to the REIT payroll preparation and
management services, employee benefits management services, and human resources
management services; and IPS is willing to continue to provide such services to
the REIT on the terms as contained herein.
D. ICS has in the past provided to the REIT data processing, computer
equipment and support services; and ICS is willing to continue to provide such
services to the REIT on the terms contained herein.
E. IRIM has in the past provided to the REIT insurance consultation and
insurance coverage placement services; and IRIM is willing to continue to
provide such services to the REIT on the terms contained herein.
F. ICOM has in the past provided to the REIT marketing communications
services; and ICOM is willing to continue to provide such services to the REIT
on the terms contained herein.
G. IPTS has in the past provided to the REIT property tax payment and
processing services; and IPTS is willing to continue to provide such services to
the REIT on the terms contained herein.
2
H. IOM has in the past provided to the REIT office management, including
mail processing services; and IOM is willing to continue to provide such
services to the REIT on the terms contained herein.
THEREFORE, in consideration of the mutual promises and agreements contained
herein, and pursuant to the Merger Agreement, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, it
is agreed as follows:
1. IREIC Services
A. IREIC agrees to provide to the REIT all of the services which it
provided to the REIT prior to the closing under the Merger Agreement, including
but not limited to maintenance of investor books and records, issuance of stock
certificates, processing ownership transfers, handling investor communications,
preparation of tax information and property status reports. Such services shall
be provided by IREIC to the REIT only when requested by the REIT, and IREIC
shall have no responsibility for such matters unless and to the extent
specifically requested by the REIT.
B. IREIC shall xxxx the REIT for the services it provides to the REIT on
the basis of its cost for such services, such cost to be determined as follows:
Each employee of IREIC shall be assigned a "CPH" number, which shall
represent the cost to IREIC on an hourly basis for having such person as an
employee of IREIC. Included in the calculation of the CPH of any employee shall
be such employee's salary, plus a pro-rata allocation of IREIC's overhead
including but not limited to employee benefits, rent, materials, fees, taxes and
any other operating expenses incurred by IREIC in the operation of its business.
Each employee of IREIC shall keep records of the amount of time he or she spends
on matters for the REIT. The amount of time spent by each employee of IREIC on
matters for the REIT shall be multiplied by such employee's CPH, and the
resulting amount shall be billed to the REIT by IREIC not less than quarterly.
Notwithstanding the foregoing, the amount of time spent by senior and middle
level management personnel on REIT matters shall not be billed by IREIC to the
REIT for the first twelve months of the term of this Agreement.
2. IPS Services; ICS Services; IRIM Services; ICOM Services; IPTS Services;
and IOM Services
A. IPS, ICS, IRIM, ICOM, IPTS and IOM agree to provide to the REIT all
of the services which they provided to the REIT prior to the closing under the
Merger Agreement, including but not limited to those services described in the
Recitals to this Agreement. Such services shall be provided by the Service
Providers to the REIT only when requested by the REIT, and the Service Providers
shall have no responsibility for such matters unless and to the extent
specifically requested by the REIT.
B. The Service Providers identified in this Section 2 shall xxxx the
REIT for the services they provide to the REIT according to the same formula
that IREIC bills the REIT for IREIC's services as described in Section 1A
hereof, except (i) all time spent by all personnel of the Service Providers
identified in this Section 2 shall be billed to the REIT and there shall be no
exclusion for senior or middle level management; and (ii) the services provided
by ICS shall be billed at the rate of $30.00 per hour.
Page -2-
3
3. Services provided by REIT personnel to the Service Providers or their
affiliates
The parties acknowledge that after the closing under the Merger
Agreement, certain personnel of the REIT may (but shall have no obligation to)
provide services to some or all of the Service Providers or their respective
affiliates. In such event, the Service Providers and their affiliates agree to
reimburse the REIT for the cost to the REIT of such services, to be determined
in the same manner as described in Paragraph 1B hereof for determining the cost
to IREIC of the services performed by its employees for the REIT.
4. All xxxxxxxx made by any of the Service Providers to the REIT or by the
REIT to any of the Service Providers shall be paid within 30 days of receipt.
5. This Agreement shall be for an initial term of twelve months.
Thereafter, this Agreement shall continue in force for as long as the REIT is
leasing space in the same building occupied by the Service Providers and shall
terminate automatically without further action of any of the parties upon
termination of the lease between the REIT and IREIC; provided that in the event
that a party (or group of parties acting in concert), unrelated to the REIT or
any of the Service Providers or their affiliates , acquires twenty five percent
(25%) or more of the outstanding voting securities of the REIT or purchases
substantially all of the assets of the REIT, then any of the Service Providers
shall have the right to terminate this Agreement as it pertains to such party
upon 30 days written notice to the REIT, and also in such event the REIT shall
have the right to terminate this Agreement as it pertains to any of the Service
Providers upon 30 days written notice to such Service Provider.
6. This Agreement may not be assigned by any of the parties hereto without
the prior written consent of the other parties.
7. This Agreement is made at Oak Brook, Illinois and shall be enforced
according to the laws of the State of Illinois.
Page -3-
4
WITNESS, this Agreement is executed by the parties hereto as of the date
first written above.
INLAND REAL ESTATE CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxx
-----------------------------------
INLAND REAL ESTATE INVESTMENT
CORPORATION
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------------
INLAND PAYROLL SERVICES, INC.
By: /s/ X. Xxxxxxx White
-----------------------------------
INLAND COMPUTER SERVICES, INC.
By: /s/ R. Xxxx Xxxxxxxxxx
-----------------------------------
INLAND RISK AND INSURANCE
MANAGEMENT SERVICES, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx
-----------------------------------
INLAND COMMUNICATIONS, INC.
By: /s/ Bella X. Xxxxxxxxx
-----------------------------------
INVESTORS PROPERTY TAX SERVICES, INC.
By: /s/ Xxxx X. Xxxxxx
-----------------------------------
INLAND OFFICE MANAGEMENT, INC.
By: /s/ Xxxxxxxx X. Xxxxx
-----------------------------------
Page -4-
