Exhibit 10.110
REAL ESTATE MANAGEMENT AND LEASING AGREEMENT
by and between
DIHC Properties I, Inc.
"Owner"
and
CK Atlanta Office Management, Inc.
"Property Manager"
REAL ESTATE MANAGEMENT AND LEASING AGREEMENT
TABLE OF CONTENTS
Page
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ARTICLE I Engagement and Authority of Property Manager..................1
1.1 Engagement....................................................1
ARTICLE II Property and Manager's Agreements.............................1
2.1(a) Contracts.....................................................2
2.1(b) Employees.....................................................2
2.1(c) Maintenance and repairs, building improvements................2
2.1(d) Tenant complaints and requests................................3
2.1(e) Notices.......................................................3
2.1(f) General liability insurance requirements......................3
2.1(g) Tenant indemnification........................................3
2.1(h) Bank accounts and fund disbursements..........................4
2.1(i) Collection of rent and legal action...........................4
2.1(j) Bonding.......................................................4
2.1(k) Notifications.................................................4
2.1(l) Tax bills and assessments.....................................4
2.1(m) Energy Conservation...........................................4
2.2 Reporting and transfer of funds...............................5
2.3 Required Software.............................................5
2.4 Control over accounting and financial transactions............6
2.5 Property budgets..............................................6
2.6 Leasing Responsibilities......................................6
2.7 Non-disclosure................................................7
2.8 Indemnification...............................................7
2.9 Materialmen and mechanics' liens..............................7
2.10 Parking Operations............................................7
ARTICLE III Owner's Agreements............................................8
3.1 Owner Payments................................................8
3.2 Insurance.....................................................8
3.3 Indemnity.....................................................8
ARTICLE IV Property Manager's Fees and Commissions; Reimbursements.......9
4.1 Management fees...............................................9
4.2 Leasing commissions...........................................9
4.3 Property Manager expenses....................................10
ARTICLE V Duration, Termination, Default...............................11
5.1 Effective date...............................................11
5.2 Termination..................................................11
5.3 Leasing Commissions after termination........................12
ARTICLE VI Assignment; Change in Control................................12
6.1 Assignment...................................................12
6.2 Change in control............................................13
ARTICLE VII Miscellaneous................................................13
7.1 Notices......................................................13
7.2 Licenses.....................................................13
7.3 Severable provisions.........................................13
7.4 Payment of expenses in the event of dispute..................13
7.5 Consent or waiver............................................14
7.6 Jurisdiction.................................................14
7.7 Competitive Ventures.........................................14
EXHIBITS:
A. Miscellaneous Provisions
B. Property Description
C. List of Reports
REAL ESTATE MANAGEMENT AND LEASING AGREEMENT
Premises: 000 Xxxxxxxx
Xxxxxxx, Xxxxxxx
THIS AGREEMENT ("Agreement") made as of the 2nd day of July, 1995 between
DIHC Properties I, Inc. ("Owner") and CK Atlanta Office Management, Inc.
("Property Manager"),
WITNESSETH:
WHEREAS, Owner is the owner of the above described premises, and Owner
wishes to avail itself of the ability and experience of Property Manager in the
on-site management of said premises; and
WHEREAS, Property Manager is willing to provide such management services
to said premises on the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the covenants herein contained, the
parties hereby agree as follows:
ARTICLE I
ENGAGEMENT AND AUTHORITY OF PROPERTY MANAGER
1.1 Owner hereby engages Property Manager as an independent contractor in the
management, leasing and operation of the above described property (the
"Premises"), and subject to the limitations set forth herein, hereby authorizes
Property Manager to exercise such powers with respect to the Premises as may be
necessary for the performance of Property Manager's obligations under Article II
hereof, and Property Manager accepts such engagement on the terms and conditions
hereinafter set forth. Property Manager shall have no right or authority,
express or implied, to commit or otherwise obligate Owner in any manner
whatsoever except to the extent specifically provided herein.
ARTICLE II
PROPERTY AND MANAGER'S AGREEMENTS
2.1 Property Manager shall conduct the ordinary and usual business affairs of
Owner relating to the management, leasing and operation of the Premises and
shall implement, or cause to be implemented, the policies of Owner for the
conduct of such business affairs in accordance with the guidelines provided in
this Agreement. The scope of Property Manager's authority shall be limited to
said guidelines. Property Manager agrees to use its best efforts in the
management, leasing and operation of the Premises, and agrees to comply with
Owner's instructions, and in connection therewith.
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(a) To contract, for periods limited to Owner's possession of the Premises, but
not in excess of one year without prior written approval of Owner, in the name
and at the expense of Owner, for gas, electricity, water, and such other
services as are necessary or convenient for the proper operation of the
Premises. Service contracts should be written to include a right of the Owner to
terminate the agreement upon thirty (30) days notice wherever possible.
(b) To select, employ, pay, supervise, direct and discharge all employees
necessary for the operation and maintenance of the Premises, in number and at
wages not in excess of those provided for in the Approved Budget or as approved
by the Owner in writing and to use reasonable care in the selection and
supervision of such employees, as reviewed and approved by Owner. Property
Manager shall be responsible for complying with all laws and regulations and
collective bargaining agreements, if any, affecting such employment, including
without limitation laws and regulations governing worker's compensation
insurance and compulsory non-occupational disability insurance. Property Manager
is and will continue throughout the term of this Agreement to be an Equal
Opportunity Employer. All persons employed or utilized in connection with the
operation and maintenance of the Premises shall be employees of Property
Manager, or of such contractors as may be retained by Property Manager pursuant
to the Agreement, and not employees of Owner, but all costs associated with the
operations of the Premises that have been included in the Approved Budget or
that have otherwise been approved by Owner, shall be reimbursed to Property
Manager by Owner. Unless included in the Approved Budget or allowed elsewhere in
this Agreement all leasing and marketing expenses win be at the Property
Manager's cost.
(c) To keep the Premises in a clean and sightly condition and to make (or cause
to be made by contractors retained by Property Manager pursuant to contracts in
the name of the Owner) all repairs, alterations, replacements, and
installations, do all decorating and landscaping, and purchase all supplies
necessary for the proper operation of the Premises or the fulfillment of Owner's
obligations under any lease or other agreement of which Property Manager has
notice, or compliance with all known governmental and insurance requirements,
provided that Property Manager shall not make any non-budgeted purchase or do
any non-budgeted work, the cost of which shall exceed the amount set forth in
Exhibit A, paragraph 3, without obtaining in each instance, the prior approval
of Owner, except in circumstances which Property Manager shall deem to
constitute an emergency requiring immediate action for the protection of the
Premises or of tenants or other persons or to avoid the suspension of necessary
services. Property Manager shall notify Owner immediately of the necessity for,
the nature of, and the cost of, any such emergency repairs or compliance. If
Owner shall require, Property Manager shall submit a list of contractors and
subcontractors performing tenant work, repairs, alterations or services at the
Premises under Property Manager's direction.
Property Manager shall supervise all tenant improvements within the
Premises as a part of its duties including the supervision of any reconstruction
of the Premises or capital improvements. Notwithstanding the foregoing, Property
Manager acknowledges that Owner may, from time to time, enter into separate
agreements with third party consultants (including affiliates
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and/or subsidiaries of Property Manager) to manage and supervise construction
work at the Premises. Property Manager shall assist Owner in facilitating the
efforts of such third party consultants. Manager shall obtain the necessary
receipts, releases, waivers, discharges and assurances to keep the Premises free
from mechanics' and materialmen's liens and other claims.
Owner shall receive the benefit of all discounts and rebates obtainable by
Property Manager in its operation of the Premises. Property Manager agrees to
take advantage of such discounts and rebates wherever available and reasonable.
If Property Manager desires to contract for repair, construction, or any
other service described in this paragraph (2.1c) with a party with respect to
which any partner or shareholder of Property Manager holds a beneficial
interest, such interest shall be disclosed to, and approved in writing by Owner
before such services are procured. The cost of any such services shall likewise
be at competitive rates, notwithstanding that tenants of the Premises may be
required to pay such costs.
Property Manager, or a general contractor working under the supervision of
Property Manager, is authorized to make and perform work at a tenant's request
and at such tenant's sole expense ("Tenant Work"), and Property Manager may
collect from tenants requesting such work or from general contractors performing
Tenant Work for the benefit of Owner, a charge for overhead on all such Tenant
Work. Property Manager, however, shall not require any tenant to use Property
Manager, its subsidiary, affiliate or related corporation to perform Tenant
Work.
(d) To handle promptly complaints and requests from tenants and notify Owner
promptly of any major complaint made by a tenant.
(e) To notify Owner promptly (together with copies of supporting documentation)
of any notice of violation of any governmental requirements; any known defect in
the Premises; any fire or other damage to the Premises; and, in the case of any
serious fire or other serious damage to the Premises, to also immediately
provide telephone notice thereof to the insurance carrier, so that an insurance
adjuster can view the damage before repairs are started and complete customary
loss reports in connection with fire or other damage to the Premises.
(f) To notify the general liability insurance carrier for the Premises and Owner
promptly of any personal injury or property damage occurring to or claimed by
any tenant or third party on or with respect to the Premises and to promptly
forward to the carrier, with copies to Owner, any summons, subpoena, or other
like legal document served upon Property Manager relating to actual or alleged
potential liability of Owner, Property Manager, or the Premises.
(g) To advise Owner of pertinent covenants in leases in which the tenants agree
to hold Owner harmless with respect to liability from any accidents and/or to
replace broken glass, and to secure from such tenants and forward to Owner any
certificates of insurance, and renewals thereof, required to be furnished by the
terms of such leases.
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(h) At the option of Owner, to receive and collect rent and all other monies
payable to Owner by all tenants and licensees in the Premises and to deposit the
same promptly in the bank named in Exhibit A (the "Bank") in an account approved
by Owner and in the name of Owner (the "Bank Account"), which Bank Account shall
be used exclusively for such funds which shall in no event be commingled with
funds of Property Manager and to disburse such funds from said Bank Account
solely in payment for, or to reimburse Property Manager for payment of,
authorized expenses incurred in connection with the operation of the Premises in
accordance with the then current budgets approved by Owner pursuant to section
2.5 of this Agreement and otherwise in accordance with the terms and provisions
of this Agreement. Property Manager shall obtain Owner's written approval on all
payments in excess of $10,000 with the exception of utility payments. In the
event state law requires that tenant security deposits be held in a separate
account, such account shall be established by Property Manager in the name of
Owner as approved in writing by Owner. If requested, Owner's designated
representative will be a signatory on all bank accounts maintained by Property
Manager.
(i) Upon the prior approval of Owner, to institute all necessary legal actions
or proceedings for the collection of rent or other income from the Premises, or
the ousting or dispossessing of tenants or other persons therefrom, and all
other matters requiring legal attention. Property Manager agrees to use its best
efforts to collect rent and other charges from tenants in a timely manner and to
pursue Owner's legal remedies for non-payment of same. Owner reserves the right
to designate or approve counsel and to control litigation of any character
affecting or arising out of the operation of the Premises.
(j) To bond Property Manager and/or all of Property Manager's employees who may
handle or be responsible for monies or property of Owner with a "comprehensive
3-D" or "Commercial Blanket" bond, in an amount of $2,000,000.
(k) To notify Owner immediately of any fire, accident or other casualty,
condemnation proceedings, rezoning or other governmental order, lawsuit or
threat thereof involving the Premises; and any material violations relative to
the leasing, use, repair and maintenance of the Premises under governmental
laws, rules, regulations, ordinances, or like provisions. Property Manager will
not bear responsibility for noncompliance, unless such noncompliance is due to
the gross negligence or willful misconduct of Property Manager or its employees.
(l) To assist in Owner's ad valorem tax review program and to cooperate with
Owner, when so requested, in efforts to reduce such taxes. Property Manager
shall promptly furnish Owner with copies of all assessment notices and receipted
tax bills.
(m) As is reasonable and customary, to promptly comply with all laws,
ordinances, orders, rules, regulations and requirements of all Federal, State
and municipal or other governmental authorities, courts, departments,
commissions, boards and offices, any national or local Board of Fire
Underwriters or Insurance Services Office having jurisdiction, or any other body
exercising functions similar to those of any of the foregoing which may be
applicable to the Premises or any
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part thereof or to the leasing, use, repair operation and management thereof. In
the event such compliance is undertaken in the name and on behalf of Owner, such
compliance shall be at Owner's expense, unless such compliance is solely of an
administrative nature. Property Manager shall give prompt notice to Owner of any
known violation or notice of alleged violation of such laws, rules, regulations
and requirements of which Property Manager has knowledge and Property Manager
shall not bear responsibility for failure of the Premises or the operation
thereof to comply with such laws, rules, regulations and requirements unless
Property Manager has committed gross negligence or a willful act or omission in
the performance of its obligations under this Agreement or in the performance of
any other duties owed to Owner or third parties by Property Manager.
2.2 Property Manager agrees to prepare and submit to Owner initial monthly
reports relating to the management and operation of the Premises for the
preceding calendar month, on or before the tenth (10th) day of each month with
all additional reports due on or before the twentieth (20th) day of the month,
in a form satisfactory to Owner, such form to be subject to change from time to
time, as Owner shall reasonably require. Property Manager shall remit to Owner
the net receipts from the Premises as directed by Owner. Property Manager agrees
that Owner shall have the right to require the transfer to Owner at any time of
any funds in the Bank Account considered by Owner to be in excess of an amount
reasonably required by Property Manager for disbursement purposes in connection
with the Premises. Property Manager agrees to prepare and submit reports
relating to the leasing of the Premises in form satisfactory to Owner as
requested by Owner.
Property Manager agrees to keep records with respect to the leasing, management
and operation of the Premises, including records of receipts and disbursements,
and to retain those records until the termination of this Agreement at which
time Property Manager shall turn over all such records to Owner. Owner shall
have the right to inspect such records and audit the reports required by this
Section during business hours until such time as all such records have been
delivered over to Owner following the termination of this Agreement in
accordance with Section 5.2 hereof.
2.3 In connection with its management of the Property, Manager shall acquire and
utilize such computer software as Owner may require. Property Manager shall keep
such software current and install all upgrades, enhancements and new versions of
the software which may be from time to time released by the vendor and/or
required by Owner (collectively, the "Required Software"). Property Manager
shall cause all personnel who use the Required Software to attend and complete
basic system training programs offered by the vendor and licensor of the
Required Software. Property Manager shall also be responsible for obtaining and
maintaining any equipment required proper operation of the Required Software,
including but not limited to, the communications equipment required or
transmission of data to Owner. Owner may from time to time require additional or
substitute software to be included among the Required Software and shall provide
not less than sixty (60) days' advance notice to Property Manager of such
additions or substitutions. Owner shall not be unreasonable with respect to the
frequency of changes in the Required Software. Property Manager shall use the
Required Software to enter, process, store and transmit data to Owner as Owner
may from time to time require and shall comply with any data reporting standards
as Owner may establish.
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2.4 Property Manager shall ensure such control over accounting and financial
transactions as is reasonably required to protect Owner's assets from loss or
diminution due to error, gross negligence or willful misconduct on the part of
Property Manager's associates or employees. Losses caused by such error, gross
negligence or willful misconduct shall be borne by Property Manager. Owner shall
have the right to review control procedures and within reason may require
changes to the existing procedures.
2.5 Property Manager shall prepare and submit to Owner proposed operating and
capital budgets for the promotion, leasing, operation, repair, and maintenance
of the Premises. Preliminary versions of the budget ("Initial Budget") will be
due August 1 of each calendar year, or as otherwise stipulated by Owner.
Property Manager shall prepare updates of the Initial Budget ("Updated Budget")
during each calendar year reflecting any changes that have occurred since the
submission of the Initial Budget and incorporating Owner's comments. All budgets
will be prepared on an accrual basis showing a month by month projection of
income and expense and capital expenditures for the forthcoming calendar year
and proposed leasing guidelines, together with an annual Business Plan for the
property. The Initial Budget and Updated Budget shall also contain any other
reports or data which the Owner in its reasonable discretion deems to be
relevant to the management and/or leasing of the Premises. Property Manager will
also provide Owner with additional reports, as listed on Exhibit C, according to
a mutually determined schedule.
After receiving Owner's approval of the Updated Budget, Property Manager shall
implement such budget and shall be authorized to make the expenditures and incur
the obligations provided for in the budget ("Approved Budget"). Property Manager
shall obtain Owner's specific approval prior to contracting for any capital
expenditures, even if already included in the Approved Budget. Property Manager
agrees to use diligence and to employ all reasonable efforts to ensure that the
actual costs of operating the Premises shall not exceed said Approved Budget.
Property Manager shall not spend any non-budgeted amount in excess of that
specified on Exhibit A, Paragraph 3, without Owner's prior written approval.
Property Manager shall operate the Premises according to the previous year's
approved Budget until current budget is fully approved. Property Manager shall
furnish to Owner within seventy five (75) days of the end of each calendar year
an unaudited statement of income and disbursements reflecting the operation of
the Premises for the previous calendar year on an accrual basis and a schedule
of the accrual accounting adjustments which were made to convert the cash year
end statement to an accrual year end statement.
2.6 Property Manager agrees to use its best efforts to cause the Premises to be
rented and kept rented to desirable tenants, satisfactory to Owner, and in
connection therewith.
(a) To negotiate leases and renewals of leases at appropriate times on an
exclusive basis, it being understood that all inquiries to Owner with respect to
leasing any portion of the Premises shall be referred to Property Manager. All
leases and renewals must be prepared by Owner's counsel and reviewed by Property
Manager in accordance with Owner's leasing guidelines and on Owner's approved
form of lease agreement and be submitted to the Owner's designated
representative for execution by Owner. Unless agreed to and directed otherwise,
Property
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manager agrees it will strictly observe the specific leasing guidelines provided
by Owner and agrees to hold Owner harmless from any damages sustained by Owner,
including the cost of defending any litigation arising out of Property Manager's
failure to observe such guidelines. References of prospective tenants, as well
as their varying use requirements, shall be investigated carefully by Property
Manager, however, all decisions concerning creditworthiness and suitability of
tenant shall be solely that of Owner, and Property Manager shall not be required
to warrant or guarantee tenant's performance.
(b) With Owner's prior written approval and at Owner's expense, to advertise the
Premises or portions thereof for rent by means of periodicals, plans, brochures
and other means appropriate to the Premises. No sign shall be placed on the
Premises by the Property Manager without the Owner's prior written approval.
2.7 Property Manager agrees, for itself and all persons retained or employed by
Property Manager in performing its services, during the term of this Agreement
and thereafter, to use best efforts to hold in confidence and not to use or
disclose to others any confidential or proprietary information of Owner
heretofore or hereafter disclosed to Property Manager, including but not limited
to any data, information, plans, programs, processes, costs, operations, or
tenants which may come within the knowledge of Property Manager in the
performance of, or as a result of, its services, except where Owner specifically
authorizes Property Manager to disclose any of the foregoing to others or such
disclosure reasonably results from the performance of Property Manager's duties
hereunder.
2.8 Property Manager shall indemnify and save harmless Owner from and against
all liability, suits, claims, and demands (including, without limitation, all
costs and attorney's fees and expenses incurred in connection therewith) by or
on behalf of any person, firm, corporation or other entity due to or arising out
of any gross negligence or willful misconduct on the part of the Property
Manager, its employees, contractors or subcontractors in connections with
Property Manager's performance of its obligations under this Agreement.
2.9 Property Manager shall use its best efforts to insure that no third party
files or suffers to be filed, any materialman's or mechanic's lien against the
Premises arising out of material incorporated therein or work performed therein
or thereon upon the request or order of Property Manager.
2.10 Property Manager agrees, at all times, to maintain an organization
sufficient to enable it to perform all of its obligations and functions under
this Agreement.
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ARTICLE III
OWNER'S AGREEMENTS
3.1 Owner, at its option, may pay directly all of the following charges relating
to the Premises: taxes, special assessments, ground rents, insurance premiums
(other than premiums arising out of Section 2.1(b) for which Property Manager is
responsible) and mortgage payments.
3.2 Owner shall self-insure or, at its option, require Property Manager to
coordinate the placement of insurance upon the Premises including both liability
and all risk insurance and shall look solely to such insurance or self-insurance
for indemnity against any loss or damage to the Premises, except in the case of
Property Manager's gross negligence or willful misconduct. To the extent that
policies shall be procured, Owner shall obtain waivers of subrogation against
Property Manager under such policies. Property Manager shall be an insured as
real estate manager on Owner's liability policy.
3.3 With respect to liabilities arising out of the use and operation of the
Premises and arising under this Agreement except for liabilities arising out of
section 2.1(b), Owner shall indemnify and save harmless Property Manager from
and against all claims, losses and liabilities (including, without limitation,
all costs and attorney's fees and expenses incurred in connection therewith)
resulting from damage to property or injury to, or death of, persons, defamation
and false arrest (including, but not limited to, the property and persons of the
parties hereto and their agents, contractors, subcontractors and employees),
occasioned by or arising out of acts or omissions, (other than criminal acts),
of (i) Property Manager (except in cases of willful misconduct or gross
negligence), (ii) the employees, contractors or subcontractors of Property
Manager (except in cases of willful misconduct or gross negligence), or (iii)
Owner or Owner's agents, employees, contractors and subcontractors. Nothing
contained in this Section 3.3 shall be construed as creating or evidencing an
employment relationship between Owner and any or all persons employed or
utilized by Property Manager pursuant to Section 2.1(b) for the operation and
maintenance of the Premises.
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ARTICLE IV
PROPERTY MANAGER'S FEES
AND COMMISSIONS; REIMBURSEMENTS
4.1 As management fees for the services performed pursuant to Article II, Owner
agrees to pay Property Manager on the basis specified in Exhibit A. Said fee
shall be payable monthly and shall be based on receipts from the previous
calendar month. Property Manager shall withdraw said fee from the operating
account for the Premises and shall account for same as provided for in Section
2.2 hereof. If fees are based on rent or income, it is understood that they
shall be applicable to rent or income actually collected, and that there shall
be excluded therefrom: direct charges for taxes, insurance, fuel, electricity,
water, labor or any other expense in connection with the operation and
maintenance of the Premises which are paid directly by a tenant to any taxing
authority, utility or service company; fire loss proceeds, capital improvements,
remodeling and tenant change costs (including any overhead factor payable by
tenants); amortization for tenant work; security deposits; however, tax, utility
service charges and operating expense escalation charges required to be
calculated, billed and collected from individual tenants by Property Manager
will be included in collected income for the purpose of calculating management
fee.
4.2 As leasing commissions, if any, for new leases secured pursuant to Section
2.6, including renewals, expansions or extensions exercised during the term of
this Agreement, Owner agrees to pay Property Manager a cash-out commission at
the rate specified in Exhibit A. A commission will be paid on direct leases
signed with subtenants for the period following the expiration date of the
original tenant's master lease. If a new lease contains a cancellation option
exercisable by the tenant, a leasing commission will be paid through the
termination date, with the commission for the balance of the lease term payable
when and if such Tenant does not terminate the lease on or before such date.
Commissions will be based on base rents and pre-determined fixed escalations
payable to Owner only and will exclude: percentage rent; variable escalations;
operating expense escalations; real estate tax escalations; any portion of said
base rent attributable to free rent. In the event a lease provides that the
tenant is to pay directly for some or all of the operating expenses and/or real
estate taxes associated with its space, then for purpose of calculating the
commissions listed in Exhibit A, the tenant's annual base rents shall be
increased by an amount equivalent to the estimated annual expenses that will be
paid by tenant during the first year of its lease. No commission will be due for
any portion of a lease term that exceeds ten (10) years. Leasing commissions for
new leases and expansions shall be paid fifty percent (50%) within thirty (30)
days after lease execution by all parties and fifty percent (50%) within thirty
(30) days after rent commencement. In the event of a renewal or extension, any
commission payment due shall be paid within thirty (30) days of the execution of
the renewal or extension documentation. When leases are negotiated by outside
brokers, Property Manager shall cooperate with such brokers, Property Manager
shall be responsible for paying all commissions to such outside brokers, and all
commissions to such outside broker shall be subject to the written approval of
Owner. The cost of all approved commissions will be borne by Owner. Property
Manager will assist Owner in negotiating the terms of fees to outside brokers,
and will submit
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recommendations to Owner regarding the percentage rate for outside brokerage
commissions in conjunction with the budget submissions provided for in Section
2.5.
4.3 As expressly identified in the Approved Budget or otherwise provided herein,
Owner will be responsible to reimburse Property Manager for the following
expenses or costs incurred by or on behalf of Property Manager in connection
with the management and leasing of the Premises. A schedule of approved
reimbursable expenses for the balance of 1995 is attached as Exhibit E.
(a) Cost of gross salary, wages, bonuses, payroll taxes, insurance, worker's
compensation, pension benefits and any other benefits of property manager,
property management clerical support, engineering personnel, and engineering
clerical support.
(b) General accounting and reporting services, as allocated to the Premises.
(c) Cost of forms, stationary, ledgers, supplies and equipment and other
property-specific expenses used in Property Manager's office, as allocated to
the Premises for property management purposes.
(d) Cost of continuing education for personnel allocated to the Premises.
(e) Cost of telecommunications, couriers, and postage allocated to the Premises.
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ARTICLE V
DURATION, TERMINATION, DEFAULT
5.1 This Agreement shall become effective, on the date specified in Exhibit A
and will continue in full force and effect for an initial term of one (1) year.
Upon the expiration of the initial one (1) year term and each subsequent renewal
period, unless terminated, as is hereinafter addressed, this Agreement will
automatically renew for one (1) year renewal periods.
5.2 This Agreement may be terminated by Owner or Property Manager at any time
(a) without cause by giving the other party written notice of the election to
terminate no less than sixty (60) days prior to the date for termination or (b)
automatically and without notice if the Premises are sold to a bonafide third
party purchaser or the Premises are acquired through foreclosure of a mortgage
or deed in lieu of foreclosure.
This Agreement may also be terminated for cause by the non-defaulting party, at
its option, upon the happening of any of the following events of default:
(i) If the Property Manager makes a general assignment for the benefit of
creditors; files in the courts a petition in bankruptcy, or insolvency, or for a
reorganization, or for the appointment of a receiver or trustee of all or a
substantial part of its property; voluntarily takes any advantage of any
bankruptcy or insolvency law; an involuntary petition or any answer is filed
against the other proposing the adjudication as a bankrupt which is not
discharged or denied within sixty (60) days thereafter, or if the Property
Manager is insolvent by reason of being unable to pay debts as they mature or
otherwise is adjudicated bankrupt.
(ii) Upon the occurrence of a breach, default, or non-compliance by Property
Manager of any of the obligations, agreements or covenants to be performed by
Property Manager hereunder contained in this Agreement, and the failure of
Property Manager to cure such breach, default or non-compliance within thirty
(30) days following receipt of written notice from the Owner specifying such
breach, default or non-compliance, provided that if the breach, default or
non-compliance is not curable within said thirty (30) day period, then upon
Property Manager's failure to commence the curing of such breach, default or
non-compliance within said thirty (30) day period and thereafter diligently and
continuously pursue such cure to completion.
(iii) Failure of Owner to reimburse Manager any sums stipulated in this
Agreement; said termination to become effective upon Manager's having served
Owner written notice of the failure and Owner's continued failure to remedy or
correct such non-compliance within thirty (30) days after receipt of such
notice.
(iv) If the Premises are damaged by fire or any other casualty or are taken
through the exercise of the power of eminent domain or sale in lieu thereof and,
in Owner's reasonable opinion, such damage or taking materially affects the
operation of the Premises for their intended purpose and the Premises cease to
be operated for such purpose.
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Upon termination of this Agreement for any reason, Property Manager shall
deliver the following to Owner or Owner's duly appointed representative on or
before thirty (30) days following the termination date:
(a) A final accounting, reflecting the balance of income and expenses for the
Premises as of the date of termination;
(b) Any balance or monies due to Owner or tenant security deposits, or both,
held by Property Manager with respect to the Premises, and
(c) All records, contracts, drawings, leases, correspondence, receipts for
deposits, unpaid bills, summary of all leases in existence at the time of
termination, and all other papers or documents which pertain to the Premises.
Such data and information and all such documents shall at all times be the
property of Owner.
5.3 If leasing commissions are or will become payable under Section 4.2 and if
this Agreement is terminated by Property Manager or Owner under Section 5.2,
Owner shall recognize Property Manager as the broker in any ongoing contact with
a Prospective Tenant (as hereinafter defined) for a lease, renewal, extension or
expansion with respect to any part of the Premises pending at the date of
termination of this Agreement unless mutually agreed to otherwise by Owner and
Property Manager. "Prospective Tenant" shall be defined as a tenant with whom
active negotiations are currently underway or who has both visited the Premises
with Property Manager (or whose leasing broker has visited the Premises with
Property Manager on Prospective Tenant's behalf) or has received a written
proposal from Property Manager or submitted a written proposal to Property
Manager prior to the date of termination of this Agreement. Property Manager
shall provide a list of Prospective Tenants ("Prospect List") to Owner within
thirty (30) business days of the effective date of termination of this
Agreement. The Prospect List will be subject to the review and approval of
Owner, which approval shall not be unreasonably denied. Unless otherwise agreed
to in writing by all parties, in the event of the consummation of a lease with a
Prospective Tenant appearing on the approved Prospect List within six (6) months
of the termination of this Agreement, Owner shall pay to Property Manager a
leasing commission with respect thereto pursuant to Section 4.2; provided,
however, that Property Manager shall not begin negotiations for any new lease or
renewal after giving or receiving a notice of termination, without the prior
written consent of Owner. No commissions shall be paid to Property Manager in
the event of the consummation of a lease more than one year after the
termination of this Agreement.
ARTICLE VI
ASSIGNMENT; CHANGE IN CONTROL
6.1 This Agreement shall be unassignable by either party and can be changed only
by a writing signed by the parties hereto, provided, however, that Owner shall
have the right to assign this Agreement in the event of a bona fide sale by
Owner of the Premises and such assignment, shall
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not constitute a breach of this paragraph 6.1, however, in the event of such an
assignment the term of this Agreement shall expire ninety (90) days after the
date of sale, unless Property Manager consents to the assignment in writing, in
which event the expiration date of the term of this agreement shall remain as
provided in Article V. Nor shall any of the services to be performed by Property
Manager under this Agreement be delegated by Property Manager to any other
person or firm without the prior written consent of Owner, provided that
Property Manager may engage independent subcontractors, at no additional cost to
Owner (except as provided in Section 2.1 hereof) and at Property Manager's sole
risk, without such consent, to provide incidental services usually performed by
independent contractors under good property management practices customary in
the locale of the Premises. Subject to Owner's direction, Property Manager will
cooperate with lawyers or consultants, pursuant to contracts in the name of the
Owner, to perform real estate tax appeals, property audits and its other
standard services required in connection with the operating of the Premises.
6.2 Notwithstanding the foregoing, Property Manager may, upon thirty (30) days
prior written notice to Owner, assign this Agreement to an affiliate provided
that the affiliate is the successor to all or substantially all of Property
Manager's management and leasing business.
ARTICLE VII
MISCELLANEOUS
7.1 Owner's Representative ("Owner's Representative") whose name and address are
set forth on Exhibit A shall be the duly authorized representative of Owner for
the purposes of this Agreement. Any statement, notice, recommendation, request,
demand, consent or approval under this Agreement shall be in writing and shall
be deemed given (a) by Owner when made by Owner's Representative or any officer
of Owner and delivered personally to Property Manager, if an individual, or to
an officer of Property Manager, if a corporation, or when mailed addressed to
Property Manager, at the address set forth in Exhibit A, and (b) by Property
Manager when delivered personally to or when mailed addressed to Owner's
Representative at the address set forth in Exhibit A. Either party may, by
written notice, designate a different address.
7.2 Property Manager shall, at its own expense, qualify to do business in the
local jurisdiction and obtain and maintain such licenses from the appropriate
authorities of said jurisdiction as may be required for the performance by
Property Manager of its services.
7.3 Each provision of this Agreement is intended to be severable. If any term or
provision hereof shall be determined by a court of competent jurisdiction to be
illegal or invalid for any reason whatsoever, such provision shall be severed
from this Agreement and shall not affect the validity of the remainder of this
Agreement.
7.4 In the event either of the parties to this Agreement shall institute any
action or proceeding against the other party relating to this Agreement, the
unsuccessful party in such action or
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proceeding shall reimburse the successful party for its disbursements incurred
in connection therewith and for its reasonable attorney's fees as fixed by the
court.
7.5 No consent or waiver, express or implied, by either party hereto or of any
breach or default by the other party in the performance by the other of its
obligations hereunder shall be valid unless in writing, and no such consent or
waiver shall be deemed or construed to be a consent or waiver to or of any other
breach or default in the performance by such other party of the same or any
other obligations of such party hereunder. Failure on the part of either party
to complain of any act or failure to act of the other party or to declare the
other party in default irrespective of how long such failure continues shall not
constitute a waiver by such party of its rights hereunder. The granting of any
consent or approval in any one instance by or on behalf of Owner shall not be
construed to waive or limit the need for such consent in any other or subsequent
instance.
7.6 This Agreement shall be governed and construed in accordance with the laws
of Atlanta, Xxxx County, Georgia. The venue of any action or proceeding brought
by either party against the other arising out of this Agreement shall, to the
extent legally permissible, be Atlanta, Xxxx County, Georgia.
7.7 It is understood that the Property Manager is engaged in the development,
management, leasing and sale of real estate similar to the business of Owner,
and may, from time to time, agree to develop, manage, lease and sell other real
estate which may compete with the business of Owner. Owner hereby consents to
the pursuit of such competitive ventures by Property Manager and acknowledges
that such ventures shall not be deemed wrongful or improper, provided that
neither Property Manager nor its affiliates shall solicit any Tenants in the
Premises or attempt to induce such Tenants to relocate out of the Premises and
into a competing property owned, controlled, or managed directly or indirectly
by Property Manager or any affiliate thereof during the term of such Tenant's
lease in the Premises.
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IN WITNESS WHEREOF, the parties have executed and delivered this agreement
as of the date first above written.
DIHC Properties I, Inc.
Owner
Witness:
[signature illegible] By: /s/ Xxx Xxxxxx
------------------------------- -------------------------------------
Name: Xxx Xxxxxx
-----------------------------------
Title: Vice President
----------------------------------
CK-ATLANTA OFFICE MANAGEMENT, INC.
a Texas corporation
Witness: By: /s/ X. Xxxxxx Childress
-------------------------------------
X. Xxxxxx Childress, President
Xxxxxx Xxxxxxxx
-------------------------------
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EXHIBIT A
AGREEMENT dated July 2, 1995 between DIHC Properties I, Inc. ("Owner") and
Childress Xxxxx Properties, Inc. ("Proper Manager").
1. Effective date (5.1):
July 2, 1995
2. Name and address of Owner's and Property Manager's Representatives (7.1):
Owner: DIHC Properties I, Inc.
c/o DIHC Management Corporation
000 Xxxxxxxx Xxxxxxx, X.X., Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Attention: Barrington H. Branch
Manager: Childress Xxxxx Properties
000 Xxxxxxxx Xxxxxxx, X.X., Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attention: X. Xxxxxx Childress
3. Limit of amount authorized for non-budgeted, non-emergency purchases and
repairs (2.1(c)(2.5)):
Two thousand five hundred dollars ($2,500)
4. Name of bank (2.1(g) Trust Company Bank
5. Description of Bank Account (Name of passbook (2.1(h)): DIHC Properties I,
Inc.
6. Management fees (4.1):
Two and three quarters (2.75%) percent of monthly collected gross
receipts, as defined in Section 4.1. For purposes of the calculation, the term
monthly gross receipts, as used in Section 4.1 and above, shall be defined to
include all minimum annual base rents, additional rents, and percentage rents,
as well as, without limitation, all rent escalations and operating expense and
real estate pass throughs actually collected from tenants in the Property in any
calendar month during the term hereof.
In the event the term hereof expires or is terminated on any date other
than the end of a calendar month, the management fee for such period of less
than a full calendar month shall be prorated on a daily basis.
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7. Rate of leasing commissions, if any (4.2):
OFFICE and RETAIL SPACE LEASES
a. New Leases in the Property:
i. Tenants Procured without Outside Broker Participation:
Four Percent (4%) of aggregate base rent to Property
Manager.
ii. Tenants Procured with Outside Broker Participation: Two
Percent (2%) to Property Manager and four percent (4%)
of aggregate base rent to Co-broker. Owner may also pay
a procurement fee equal to one (1) month's rent, if
required by market conditions to Co-broker.
b. Leases After Initial Leases (Including Extension, Renewals,
Expansions):
i. Tenants Procured without Outside Broker Participation:
Two Percent (2%) of aggregate base rent to Property
Manager.
ii. Tenants Procured with Outside Broker Participation: One
Percent (1%) of aggregate base rent to Property Manager
and two percent (2%) of aggregate base rent to Co-broker
c. The parties acknowledge Property Manager is eligible for
annuity commission for leases consummated during the initial
term of the Leasing Agreement (a list is included and made a
part of this Agreement as Exhibit D), and these annuities
shall continue for the remaining term of those leases.
d. Property Manager shall continue to be responsible for any
on-going annuity commissions payable to outside brokers as
future cash-out payments which Property Manager is obligated
to pay under the term of the initial Leasing Agreement.
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EXHIBIT B
AGREEMENT dated July 2, 1995, between DIHC Properties I, Inc. ("Owner") and
Childress Properties, Inc. ("Property Manager").
PROPERTY DESCRIPTION
The land, and all improvements thereon, located on the lot(s) numbered 947 or
the 17th District, 2nd Section, Xxxx County, Georgia
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