Exhibit 10.6(a)
BPIA AGREEMENT
This BPIA Agreement (the "Agreement") is entered into by and
between Westminster Holdings, Inc., a California corporation doing
business as BPI Acquisitions ("BPIA") and Bedford Property Investors,
Inc., a Maryland corporation (the "Company") as of January 1, 1995.
RECITALS
A. Since February, 1993 the Company and Xxxxx X. Xxxxxxx, the
Chairman and Chief Executive Officer of the Company, have
been operating pursuant to an arrangement with respect to
the acquisition and financing activities of the Company.
BPIA, formerly an acquisition division of the Company, is
now a corporation wholly owned by Xx. Xxxxxxx. The parties
therefore wish to document the terms of their current and
prospective arrangement in this Agreement.
B. The parties further wish to acknowledge and confirm that as
of December 31, 1994, the amount owed to Xx. Xxxxxxx under
the terms of the arrangement was Seven Hundred Eleven
Thousand Nine Hundred Ninety-Four Dollars ($711,944.00) (a
receivable transferred to and now owing to BPIA) and as of
March 31, 1995, the additional amount owed to BPIA under
the arrangement was Two Hundred Fifty Thousand Seven
Hundred Fifty Dollars ($250,750), all as specifically set
forth in line item detail on Exhibit A attached to this
Agreement (the "Current Obligations").
AGREEMENT
NOW, THEREFORE, the parties agree as follows:
1. Term of Contract. This Agreement will initially be for a
term of one (1) year commencing as of January 1, 1995, and
may be extended for additional one (1) year terms, subject
to a maximum term of three (3) years, at the sole election
of the Company. Unless the Company presents BPIA with
written notice of termination sixty (60) days prior to the
expiration of the then current term, the Agreement shall be
extended automatically for each additional one (1) year
term. The Company shall have the further right to
terminate this Agreement upon sixty (60) days prior notice
at any time, subject to the payment of BPIA's fees as
contemplated in Section 3 below.
2. Services. During the term of this Agreement, BPIA shall
engage solely and exclusively in the provision of services
to the Company with respect to the Company's acquisition
and financing activities (the "Services") including by,
without limitation, the following:
(a) Financing. BPIA shall assist the Company in obtaining
both debt and equity financing ("Financing") for the
Company by, among other things, locating sources of
Financing, negotiating term sheets for Financings,
assisting in the negotiation and drafting of any
documents necessary or appropriate to complete the
Financing and generally providing such additional
services with respect to the Financing as the Company
shall request, subject to the constraints of BPIA's
staff, approved budgets and expertise.
(b) Acquisitions. BPIA shall assist the Company in
acquisition of real properties ("Acquisitions") by,
among other things, locating and identifying potential
properties, negotiating property purchase agreements,
preparing investment analyses in connection with
potential acquisitions, conducting and supervising the
Company's due diligence activities in connection with
potential acquisitions and preparing and submitting to
the Company's Board of Directors term sheets with
respect to potential acquisitions and generally
providing such additional services with respect to
Acquisitions as the Company shall request, subject to
the constraints of BPIA's staff, approved budgets and
expertise.
(c) Discretion of the Company. All of the foregoing
Services shall be conducted subject to the Company's
right to determine at any time and for any reason
whatsoever to commence, cease or modify any Financing
or Acquisition activity. Notwithstanding the
following provisions regarding BPIA's compensation,
the Company shall retain sole and absolute discretion
as to whether and when to conduct or consummate any
Financing or Acquisition and whether and when to
perform any contractual undertaking with a third party
entered into as part of a Financing or Acquisition
activity.
(d) Authority. BPIA shall have no authority to execute on
behalf of the Company any agreement, term sheet or
other undertaking or to represent to any third party
that BPIA has the authority to enter into any
agreement, written or oral, which would bind the
Company.
3. Compensation. For the Services rendered under this
Agreement, the Company shall pay to BPIA, simultaneously
with the closing of each Acquisition or Financing, a fee in
an amount equaling the lesser of (i) one and one-half
percent (1 1/2%) of the gross amount of the Financing or
the aggregate purchase price with respect to an
Acquisition, or (ii) an amount equal to (A) the aggregate
amount of Approved Expenses (as defined in Section 4 below)
funded by BPIA through the time of such Acquisition or
Financing minus (B) the aggregate amount of fees (including
fees attributable to Approved Expenses) previously paid to
BPIA under this Agreement. Following the termination of
this Agreement for any reason, the Company shall remain
obligated to and shall pay to BPIA the fee described above
if and when any Financing or Acquisition identified in good
faith by BPIA as a transaction upon which BPIA has worked
prior to the termination closes, provided that in the event
of a termination of this Agreement based on BPIA's default,
such fees shall be reduced by any damages caused directly
by BPIA's default. BPIA's identification of pre-
termination current transactions shall be provided to the
Company in writing within 30 days following the
termination. Notwithstanding the foregoing, at any time
following any date upon which the holders of the Series A
Preferred (as defined in the Company's Charter) elect the
majority of the members of the Board of Directors of the
Company, the Company shall pay to BPIA, in full and final
payment for all services rendered the amount described in
clause (ii) above, within 60 days following the date of any
termination (reduced by any damages caused directly by a
default of BPIA triggering such termination).
4. Expenses. BPIA shall be responsible for the direct payment
of all of the following costs and expenses during the term
of this Agreement:
a. The costs of salary and wages, payroll taxes,
insurance, worker's compensation and other benefits of
BPIA's employees and agents and training and hiring
expenses;
b. The cost of BPIA's overhead including, without
limitation, the cost of forms, papers ledgers and
other office supplies and equipment, telephone,
telecopy, courier, expedited delivery and postage
charges, and miscellaneous expenses;
c. The cost of accounting and reporting services;
d. An amount equal to 40% of the costs of the Company's
officers and directors insurance;
e. The cost of travel by BPIA's employees and agents in
connection with the Performance of the Services;
f. The out-of-pocket costs incurred in connection with
the arrangement, due diligence and negotiation stages
of any Financing or Acquisition, including the costs
of any title services, survey, financial investigating
services, market studies, photographic services,
architectural and engineering services,
accountant/auditing work, legal counsel, environmental
inspections and reports and other due diligence
efforts, all in accordance with the past practices of
the Company and Xxxxx X. Xxxxxxx.
Items a through d above shall be referred to as "Overhead
Costs;" items e and f shall be referred to as "Transaction Costs."
For the purposes of this Agreement, all such costs and expenses shall
be deemed "Approved Expenses" if and to the extent that such expenses
are reasonable in amount and do not exceed the sums budgeted therefore
under the then approved current Overhead Budget or Transaction Budget
(each as defined below). In no event shall costs attributable to
losses arising from gross negligence, willful misconduct or fraud on
the part of BPIA or BPIA's officers, employees, or agents, or arising
from BPIA's breach of this Agreement constitute Approved Expenses.
5. Budgets and Reporting.
(a) BPIA has submitted and the Company has approved the
budget attached to this Agreement as Exhibit B setting
forth its projected Overhead Costs for the balance of
calendar year 1995 (the "Overhead Budget"). BPIA
shall, prior to December 1 of each year during which
this Agreement remains in effect, submit to the
Company for the Company's approval an Overhead Budget
setting forth its projected Overhead Costs for the
next calendar year. The Company's approval of such
budget shall not be unreasonably withheld or delayed.
BPIA and the Company acknowledge, however, that the
Overhead Budget and the Company's approval of the
budget shall be subject to the further approval of AEW
(as defined in that certain Series A Preferred Stock
Purchase Agreement dated as of May 18, 1995, by and
among AEW Partners, L.P., Xxxxx X. Xxxxxxx and the
Company). The foregoing provisions are intended by
the parties to benefit AEW as a third party
beneficiary.
(b) In addition, BPIA shall, as early as reasonably
practicable, submit to the Company for its approval a
budget for each potential Acquisition or Financing
setting forth the estimated timing and amount of all
projected Transaction Costs (each, a "Transaction
Budget").
(c) BPIA shall provide a monthly accounting of all
Overhead Costs or Transaction Costs incurred, which
report shall identify any items inconsistent with the
approved budgets. The Company shall exercise
reasonable efforts following receipt of such report to
review and approve the report and to identify in
writing any expenses which the Company believes are
not reimbursable under the terms of this Agreement,
together with a statement of the basis for any
objection. No failure affirmatively to object upon
receipt of a report of expenses incurred, however,
shall convert Overhead Expenses not contemplated in
the approved Overhead Budget or other expenses not
otherwise properly treated under this Agreement as
Approved Expenses into Approved Expenses.
6. Employees. All persons employed by BPIA in connection with
the Services shall be BPIA's employees or independent
contractors, and shall not be the employees or agents of
the Company. BPIA shall fully comply with all applicable
laws and regulations having to do with worker's
compensation, social security, unemployment insurance,
hours of labor, wages, working conditions, and other
employer-employee related subjects. BPIA represents that
it is and will continue to be an equal opportunity
employer.
7. Limited Activity. During the term of this Agreement, BPIA
shall not engage in any activity whatsoever other than the
provision of the Services or enter into any contractual
relationship of any kind, directly or indirectly, as owner,
employee, partner, tenant, option holder, through stock
ownership, investment of capital, lending or borrowing of
money or property, rendering of services or otherwise.
8. Confidentiality. BPIA agrees to maintain the
confidentiality of all information with respect to its
performance of the Services and any property or interests
of the Company. BPIA may, however, disclose any of such
information to its agents, directors, officers, employees,
advisors, attorneys or representatives who require such
information for the purpose of performing or assisting in
the performance of the Services, provided that such parties
shall be informed of the confidential nature of such
information. BPIA may also disclose any such information
to the extent required by law or court order provided that
BPIA shall have first, to the extent reasonably
practicable, advised the Company of the requirement to
disclose such information and shall have afforded the
Company an opportunity to dispute such requirement and seek
relief therefrom by legal process. The provisions of this
Section shall survive the expiration or termination of this
Agreement.
9. Applicable Law. This Agreement and all other documents and
instruments executed and delivered to evidence, complete or
perfect the transactions contemplated hereby and thereby
will be interpreted, construed, applied and enforced in
accordance with the laws of the State of California
(without regard to principles of conflicts of laws
otherwise applicable).
10. Indemnification.
(a) BPIA shall indemnify, defend and hold harmless the
Company for, from and against any cost, loss, damage
or expense (including, but not limited to, reasonable
attorneys' fees and all court costs and other expenses
of litigation, whether or not taxable under local law)
resulting from breach of this Agreement,
discriminatory conduct, willful misconduct or gross
negligence on the part of BPIA or its officers,
employees, agents or representatives or arising out of
BPIA's policies, procedures, acts or omissions
relating to employment matters.
(b) The Company hereby agrees to indemnify, defend and
hold harmless BPIA for, from and against any cost,
loss, damage or expense (including, but not limited
to, reasonable attorneys' fees and all court costs and
other expenses of litigation, whether or not taxable
under local law) resulting from (i) the breach of this
Agreement by the Company, (ii) willful misconduct or
gross negligence of the Company or its partners,
employees, agents or representatives, or (iii) any
action or claim against BPIA arising out of the
performance of BPIA of its duties hereunder, provided
that (x) such action or claim shall not have arisen by
reason of breach of this Agreement by BPIA,
discriminatory conduct or willful misconduct or gross
negligence of BPIA or its officers, employees, agents
or representatives and (y) such action or claim shall
not arise out of BPIA's policies, procedures, acts or
omissions relating to employment matters.
11. Assignment. Neither this Agreement nor any of the
obligations hereunder shall be assignable or delegable by
either party without the prior written consent of the other
party, provided that the rights and obligations of the
Company may be assigned and delegated to any successor by
merger or reorganization of the Company or to any entity
which acquires all or substantially all of the assets of
the Company, provided that following any such succession,
Xxxxx X. Xxxxxxx remains the CEO (or an equivalent
position) in the successor entity.
12. Notices. Any notices required to be given under this
Agreement by one party to the other may be affected by
delivery, in writing, by facsimile, mail, registered or
certified, postage prepaid with return receipt requested.
Notices delivered personally or by facsimile will be deemed
communicated as of the date of actual receipt; mailed
notices will be deemed communicated as of the day of
receipt or the fifth business day after mailing, whichever
occurs first.
13. Titles and Subtitles. The titles and subtitles used in
this Agreement are used for convenience only and are not to
be considered in construing or interpreting this Agreement.
14. Entire Agreement of the Parties. This Agreement supersedes
any and all agreements, either oral or written, between the
parties with respect to the rendering of services by BPIA
to the Company and contains all of the representations,
covenants, and agreements between the parties with respect
to the rendering of those services. Each party to this
Agreement acknowledges that no representations,
inducements, promises, or agreements, orally or otherwise,
have been made by any party, or anyone acting on behalf of
any party, which are not contained in this Agreement, and
that no other agreement, statement, or promise not
contained in this Agreement will be valid or binding. Any
modification of this Agreement will be effective only if it
is in a writing signed by the Party to be charged.
15. Recovery of Litigation Costs. If any legal action or other
proceeding, or arbitration proceeding, is brought for the
enforcement of this Agreement, or because of an alleged
dispute, breach, default, or misrepresentation in
connection with any of the provisions of this Agreement,
the prevailing party or parties shall be entitled to
recover court costs, arbitration costs, reasonable
attorneys' fees and other costs incurred in that action or
proceeding, in addition to any other relief to which it or
they may be entitled. The prevailing party shall be
determined based upon an assessment of which party's major
arguments made or positions taken in the proceedings fairly
could be said to have prevailed over the other party's
major arguments or positions on major disputed issues in
the decision.
16. Amendments and Waivers. Any term of this Agreement may be
amended and the observance of any term of this Agreement
may be waived (either generally or in a particular instance
and either retroactively or prospectively), only with the
written consent of the parties hereto and AEW. The
foregoing provision is intended by the parties to benefit
AEW as a third-party beneficiary.
17. Severability. If any provision of this Agreement is held
invalid or unenforceable by any court of final
jurisdiction, it is the intent of the parties that all
other provisions of this Agreement be construed to remain
fully valid, enforceable, and binding on the parties,
provided that no such severability shall be effective if it
materially changes the economic benefit of this Agreement
to any party.
18. Confirmation. Xxxxx X. Xxxxxxx'x execution of this
Agreement in the space provided below shall both confirm
the accuracy of the Recitals and express Xx. Xxxxxxx'x
agreement to make the payments of expenses required of BPIA
in Section 4 above should BPIA fail to make any of such
payments in timely fashion, provided that Xx. Xxxxxxx shall
have no such obligation if, when and to the extent that the
outstanding amount described in Section 3 (ii) above
exceeds $1,000,000 or following a termination of BPIA's
obligations based on the expiration or termination of the
term of this Agreement or pursuant to the operation of
Section 11. In furtherance of the foregoing:
(a) Xx. Xxxxxxx acknowledges that the foregoing is an
absolute and unconditional undertaking of payment,
enforceable without the necessity of any suit or
proceedings of any kind or nature whatsoever against
BPIA and without the necessity of any notice of
nonpayment, nonperformance or nonobservance or any
notice of acceptance. Xx. Xxxxxxx hereby expressly
agrees that the validity of this undertaking and the
obligations set forth shall in no way be affected,
diminished, impaired or terminated by reason of the
assertion or the failure to assert by the Company
against BPIA of any of the rights or remedies reserved
to the Company or otherwise by (i) the release or
discharge of BPIA in any creditors' proceedings,
receivership, bankruptcy or other proceedings, (ii)
the impairment, limitation or modification of the
liability of BPIA or the estate of BPIA in bankruptcy
or (iii) the rejection or disaffirmance of this
Agreement in any such proceedings. Xx. Xxxxxxx
further waives any defense based upon any statute or
rule of law which provides that the obligation of a
surety must be neither larger in amount nor in any
other respect more burdensome than that of a
principal.
(b) This undertaking shall be continuing and the liability
of Xx. Xxxxxxx shall in no way be affected, modified
or diminished by reason of any assignment (except as
provided in Section 11 above), renewal pursuant to
Section 1 above (subject to the maximum 3-year term)
or by reason of any modification or waiver of or
change in any of the terms, covenants, conditions or
provisions of the Agreement. Without limiting the
generality of the foregoing, the Company may at any
time and from time to time without the consent of, or
notice to, Xx. Xxxxxxx, without incurring
responsibility to and without impairing or releasing
the obligations of Xx. Xxxxxxx hereunder: (i) exercise
or refrain from exercising any rights against BPIA or
others or otherwise act or refrain from acting, or
(ii) settle or compromise in good faith any
obligations of BPIA under the Agreement.
The parties hereto have executed this Agreement as of the date
first written above.
BEDFORD PROPERTY INVESTORS, INC. WESTMINSTER HOLDINGS, INC.
/s/ Xxxxxx X. Xxxxxx /s/ Xxxxx X. Xxxxxxx
Xxxxxx X. Xxxxxx Xxxxx X. Xxxxxxx
Its: Chief Financial Officer
The undersigned Xxxxx X. Xxxxxxx executes this Agreement solely for
purposes of Section 18 above.
/s/ Xxxxx X. Xxxxxxx
Xxxxx X. Xxxxxxx
