Exhibit 10.01
DEVELOPMENT CONSULTING AGREEMENT
This Development Consulting Agreement ("Agreement") is entered into
effective this 1st day of August, 2003, by and between Diversified Investment &
Management Corporation, a California corporation ("DIMC") and Xxxxxxxxxx Realty
Group, Inc., a Nevada corporation, and is based upon the following facts and
representations:
A. On or about July 17, 2003, a written Purchase and Sale Agreement was
entered into by and between Xx. Xxxxxx Xxxxxx, an individual ("Xxxxxx")
and Xxxxxxxxxx Realty Group, Inc., a Nevada corporation ("Xxxxxxxxxx")
whereby Xxxxxxxxxx agreed to purchase from Xxxxxx that certain real
property located at 000-000 Xxxxx Xxxxxx, Xxx Xxxxxxxxx, Xxxxxxxxxx
(the "Property") for a purchase price of 4,485,000.
B. The Property consists of a four-story office building, which is vacant,
except that the first floor and basement is leased to Xxxxxxxxx'x
Restaurant pursuant to a 10 year lease.
C. In order for the remainder of the Property to become income producing,
development of the Property will be required and the Purchase and Sale
Agreement provided that Xxxxxxxxxx was purchasing not only the
Property, but also all development rights and other intangibles.
D. Paragraph 2(b) of the Purchase and Sale Agreement further provided that
Xxxxxxxxxx and DIMC could enter into an agreement whereby DIMC would
act as a fee based consultant to assist Xxxxxxxxxx with the permit,
entitlement and development process.
E. The Board of Directors of Xxxxxxxxxx approved the transaction on July
16, 2003 at a Special Meeting of the Directors and the sale closed on
July 30, 2003.
F. DIMC is a California corporation wholly owned by Xxxxxx and is the
property management company employed by Xxxxxxxxxx to manage all of its
real estate assets. DIMC was also the company managing the Property and
working on its development process prior to the date of the Purchase
and Sale Agreement and the officers of DIMC have experience in real
estate development.
NOW THEREFORE the parties hereto agree as follows:
1. DIMC agrees to provide consulting services to Xxxxxxxxxx with
respect to all architectural services, environmental services, soils and ground
testing services, structural engineers, construction contracts and contractors,
construction estimation and bidding, planning and building permit application
services, together with any and all related services to be performed in
connection with the rehabilitation and development of the Property, including,
but not limited to the specific services enumerated above.
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2. Xxxxxxxxxx agrees to pay to DIMC a consulting fee of not less than
Twenty Five Thousand Dollars ($25,000) per month, payable at the end of each
month, during the first three (3) months following the effective date of this
Agreement, or until Entitlements are obtained, whichever is longer.. Xxxxxxxxxx
further agrees to reimburse DIMC for all architectural fees, consultant fees,
engineering fees and related fees and expenses, including all design and
planning department approval and review fees, together with all other normal and
customary costs associated with the renovation of a San Francisco office
building into a modern, rentable and income producing property.
3. Xxxxxxxxxx agrees to pay to DIMC a consulting fee for development
itself, following this issuance of Entitlements, in an amount to be agreed upon
between Xxxxxxxxxx and DIMC, and based upon the estimated development costs to
be expended during the renovation itself.
4. DIMC may ask Xxxxxxxxxx for reasonable retainers, from time to time,
based upon the average expenses incurred in the preceding quarter, or such other
amount as DIMC intends to spend in the upcoming quarter, with DIMC to provide to
Xxxxxxxxxx such reasonable budget estimates and similar matters as Xxxxxxxxxx
may from time to time request.
5. This Agreement shall terminate upon the earlier of (A) three (3)
years from the effective date hereof; (B) upon cessation of plans by Xxxxxxxxxx
to develop the Property as an office building and giving at least thirty (30)
days notice; or (C) upon either party giving the other party at least ninety
(90) days written notice of intent to terminate this Agreement.
6. Miscellaneous Provisions
A. Agreement Binding on Successors. The terms, covenants and agreements
herein contained shall bind and inure to the benefit of Xxxxxxxxxx and DIMC, and
each of their heirs, personal representatives, successors and assigns, subject
to the provisions of this Lease. No rights, however, shall inure to the benefit
of any assignee of DIMC unless the assignment to such assignee has been approved
by Xxxxxxxxxx.
B. Attorneys' Fees.
If either party to this Agreement becomes a party to any litigation
concerning this Agreement, or any matter that is the subject matter of this
Agreement, the prevailing party shall be liable to that party for reasonable
attorneys' fees and court costs incurred by it in the litigation.
C. Sale of Premises. The term "Xxxxxxxxxx" as used in this Lease shall
mean the owner of Xxxxxxxxxx'x estate in and to the Leased Premises. If the
Xxxxxxxxxx'x interest and estate in and to the Leased Premises is sold or
assigned by Xxxxxxxxxx, the seller shall be entirely freed, relieved and
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discharged of all covenants, agreements and obligations under this Lease, except
those occurring prior to the date of such sale by Xxxxxxxxxx, and attributable
to Xxxxxxxxxx'x period of ownership of such interest and estate.
D. Notices. Any notice or demand required or permitted by law or by any
of the provisions of this Lease shall be in writing. All notices or demands by
Xxxxxxxxxx to DIMC shall be deemed to have been properly given when served
personally on an executive officer of DIMC or when sent by certified mail,
return receipt requested, postage prepaid, and addressed to DIMC at the address
set forth below. All notices or demands by DIMC to Xxxxxxxxxx shall be deemed to
have been properly given if served personally on an executive officer of
Xxxxxxxxxx, or when sent by certified mail, return receipt requested, postage
prepaid, addressed to Xxxxxxxxxx at the address set forth below. Either party
hereto may change the place to which notices are to be given by advising the
other party in writing. If any notice or other document is sent by mail, as
aforesaid, the same shall be deemed served or delivered forty-eight (48) hours
after the mailing thereof, provided there is regular service by mail, at the
time of such mailing, between the place of mailing and the place to which such
notice or other document is mailed. In lieu of personal service or certified or
registered mail, a notice or demand may be delivered by courier service which
obtains receipt for delivery and the notice or demand shall be deemed delivered
upon the date shown upon such receipt. If more than one individual or entity is
collectively the DIMC under this Lease, service of any notice upon any of said
individuals or entities shall be deemed as serviced upon all of said individuals
and entities which collectively are the DIMC under this Lease.
E. Section Headings. The headings or captions of sections in this Lease
are for convenience and reference only, and they in no way define, limit or
describe the scope or intent of this Lease or the provisions of such sections.
F. Gender and Interpretation of Terms and Provisions. As used in this
Lease and whenever required by the context thereof, each number, both singular
or plural, shall include all numbers, and each gender shall include all genders.
"Xxxxxxxxxx" and "DIMC" as used in this Lease or in any other instrument
referred to in or made a part of this Lease shall likewise include both the
singular and the plural, a corporation, co-partnership, individual or person
acting in any fiduciary capacity as executor, administrator, trustee or in any
other representative capacity. All covenants herein contained on the part of
DIMC shall be joint and several.
G. Time of Essence. Time is hereby expressly declared to be of the
essence of this Lease and of each and every covenant, term, condition and
provision hereof.
H. Impartial Construction. The language in all parts of this Lease
shall be in all cases construed as a whole according to its fair meaning and not
strictly for nor against either Xxxxxxxxxx or DIMC.
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I. Waiver. No waiver of any breach of the terms, covenants, agreements,
restrictions or conditions of this Lease shall be construed as a waiver of any
succeeding breach of the same or other covenants, agreements, restrictions or
conditions of this Lease, nor shall consent to any assignment or sublease be
deemed to waive any requirement of consent of Xxxxxxxxxx to any other assignment
or sublease. The consent or approval of either party to or of any act or matter
requiring consent or approval shall not be deemed to waive or render unnecessary
consent to or approval of any subsequent or similar act or matter.
J. Partial Invalidity. If any term, covenant or condition of this Lease
or the application thereof to any person or circumstance shall, to any extent,
be invalid or unenforceable, the remainder of this Lease, or the application of
such term, covenant or condition to persons or circumstances other than those as
to which it is held invalid or unenforceable shall not be affected thereby and
each term, covenant or condition of this Lease shall be valid and be enforced to
the fullest extent permitted by law.
L. Remainder of Managed Properties. Both DIMC and Xxxxxxxxxx
acknowledge and agree that that nothing contained herein shall be construed to
modify any other written agreement between the parties hereto.
N. Quarterly Reports. Not more than thirty (30) days after the end of
each quarter, DIMC shall submit to Xxxxxxxxxx its expense report, and a
statement indicating any retainers taken to defer anticipated expenses.
O. Limitation on Liability. Anything in this Agreement to the contrary
notwithstanding, DIMC agrees that it shall look solely to Xxxxxxxxxx as a
corporation and shall not seek any damages from any officer or director of
Xxxxxxxxxx.
P. Waiver of Jury Trial. The parties hereto shall and they hereby do
waive trial by jury in any action, proceeding or counterclaim brought by either
of the parties hereto against the other on any matters whatsoever arising out of
or in any way connected with this Lease, the relationship of Xxxxxxxxxx and
DIMC, DIMC's use or occupancy of the Leased Premises, and/or any claim or injury
or damage.
Q. Law Governing. The laws of the state wherein the Leased Premises are
located shall govern the validity, performance and enforcement of this Lease.
R. Amendment. No provision of this Lease may be amended or added to
except by an agreement in writing signed by the parties hereto or their
respective successors-in-interest.
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S. Notices: All notices shall be sent to the following parties:
Xxxxxxxxxx Realty Group, Inc.
Attn: Xxxxxx Xxxxxx
000 Xxxxxx Xxxxx Xxxx.
Xxxxx 000
Xx. Xxx Xxxxxxxxx, XX 00000
Diversified Investment & Management Corporation
Attn: Xx. Xxxxx X. Xxxxxxx
000 Xxxxxx Xxxxx Xxxx.
Xxxxx 000
Xx. Xxx Xxxxxxxxx, XX 00000
Or such other address as the party may designate pursuant to subparagraph D
above.
IN WITNESS WHEREOF the parties hereto have executed this Agreement at
South San Francisco effective the date first written above.
Xxxxxxxxxx Realty Group, Inc., a
Nevada corporation
/s/ Xxxxxx Xxxxxx
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By: Xx. Xxxxxx Xxxxxx
Its: President
Diversified Investment & Management
Corporation, a California corporation
/s/ Xxxxx X. Xxxxxxx
------------------------------
By: Xx. Xxxxx X. Xxxxxxx
Its: Vice President
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