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EXHIBIT 10.168
HOTEL MAISON XXXXXX XXXXXXX, LTD. OWNERS ASSOCIATION, INC.
MANAGEMENT AGREEMENT
THIS AGREEMENT ("Agreement"), is entered into as of the ____ day of
May, 1999 by and between HOTEL MAISON XXXXXX XXXXXXX LTD. OWNERS ASSOCIATION,
INC., a Louisiana nonprofit corporation (the "Association") and PREFERRED
EQUITIES CORPORATION, a Nevada corporation ("Manager"). For valuable
consideration, the parties hereto agree as follows.
RECITALS
A. The Hotel Maison Xxxxxx Xxxxxxx, Ltd. - A Condominium (the
"Property") has been created pursuant to that certain Condominium Declaration
And Timeshare Program for Hotel Maison Xxxxxx Xxxxxxx Hotel (the "Declaration"),
recorded on June 20, 1996 in Book NA 96-29442, Instrument Number 124103 in the
real property records of Orleans Parish, Louisiana.
B. Pursuant to the provisions of the Declaration, the Association is
responsible for maintenance, control, operation, management and general care of
the Property. The Association is authorized to retain a professional management
organization and to delegate to such organization certain of the Association's
powers and responsibilities.
C. The Board of the Association ("Board") desires to engage Manager to
manage and operate the Property, and Manager desires to accept such engagement,
all on the terms and conditions set forth below.
TERMS AND CONDITIONS
1. ENGAGEMENT. Association hereby engages Manager subject to Manager's
right to terminate during the Transition Period (as hereinafter defined),
commencing on the date of this Agreement as the exclusive managing agent of the
Property contemplated by the Declaration to manage the Property and Association
under the name "Ramada Vacation Suites" (the cost of all signage including
installation, using the name Ramada Vacation Suites, shall be paid for by the
Association), and Manager hereby accepts said appointment and undertakes to
perform all of the services and responsibilities set forth herein in such
capacity and to comply with all the provisions of this Agreement.
2. DEFINITIONS. In addition to other definitions provided for herein,
the terms used herein shall have the same meaning as the meanings attributed
thereto in the Declaration. As used herein, the term "Transition Period" shall
mean the ninety (90) days following the date of this Agreement (or such other
time as may be necessary for Manager to obtain any and all federal, state and/or
local licenses or permits required of the Manager to perform the obligations
stated herein). In the event Manager determines for any or no reason that it
cannot fulfill its duties as Manager as stated herein, Manager shall have the
right to terminate the Agreement, at its sole option, by delivering a written
notice of termination to Association on or before the end of the Transition
Period.
3. TERM.
3.1 INITIAL TERM. Unless terminated earlier pursuant to ss.
3.2 below, the term of this Agreement shall expire at the end of three (3) years
from the date of this Agreement or upon the resignation of the Manager,
whichever occurs first.
3.2 TERMINATION. This Agreement may be terminated by the Board
at any time during the term as a result of a breach or default by Manager;
provided that Manager shall not be in breach or default under this Agreement
unless Manager has been given written notice of said breach or
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default by the Board and has not cured said breach or default within sixty (60)
days of said notice. In the event that Manager shall dispute a termination by
the Association pursuant to the provisions of this ss. 3.2, the dispute shall be
addressed pursuant to Section 14. of this Agreement. In the event Manager loses
or terminates its right to use the Ramada Vacation Suites name, the Board may
terminate this Agreement upon giving Manager ninety (90) days written notice of
its intent to terminate.
3.3 RESIGNATION. Manager may resign only upon condition that
Manager shall have given at least ninety (90) days, or such lesser time as may
be agreed by the Association, prior written notice to the Association. On or
before the effective date of Manager's resignation, Manager shall turn over all
books and records relating to the management and operation of the Property to
the Association or successor managing agent.
3.4 RENOVATIONS. Notwithstanding the foregoing, in the event
renovations ("the Renovations") to the Property as agreed by and among Manager
and the Association are not completed, at Association's sole cost and expense,
to the reasonable satisfaction of Manager, on or before six (6) months from the
date of this Agreement, Manager may resign upon the giving of thirty (30) days
written notice. A schedule, defining the Renovations and signed by both parties,
shall be attached hereto as an Addendum, prior to the termination of the
Transition Period.
4. DUTIES AND OBLIGATIONS OF MANAGER.
4.1 GENERAL. Manager shall at all times, in a manner
consistent with the provisions of the Declaration and the Bylaws of Hotel Maison
Xxxxxx Xxxxxxx, Ltd. Owners' Association, Inc. ("Bylaws") and subject to the
terms and conditions set forth herein, provide or cause to be provided all
services and personnel required to administer the affairs of the Association.
Manager, to the extent necessary to perform its duties and obligations
hereunder, shall have all the powers that the Association has pursuant to the
Declaration and Bylaws. Subject to the provisions of ss. 4.5 below, Manager may
delegate its authority and responsibilities to one or more subagents for such
periods and upon such terms as Manager deems appropriate.
4.2 ADMINISTRATIVE SERVICES. Manager shall, in addition to the
duties in ss. 4.1, provide the following services of an administrative nature.
(A) ASSOCIATION MEETINGS. Manager shall organize the
meetings of the Board and of the Association, including the preparation and
delivery of notices of meetings, in accordance with the provisions of the
Bylaws. Manager shall prepare the agenda for all meetings, assist in the conduct
of the meetings and oversee the election of directors. Manager shall circulate
minutes of any such meeting as prepared by the secretary of the Association; or,
as prepared by a person designated as secretary for a particular meeting(s) by
Manager. All meetings, except the Association's annual meeting, may be conducted
by telephone.
(B) ASSOCIATION RECORDS. Manager shall keep all
records of the affairs of the Association, including but not limited to, minutes
of meetings, correspondence, Bylaws, Rules and Regulations, the Declaration and
any modification of any of the foregoing, from the date of expiration of the
Transition Period throughout the term of this Agreement.
(C) RULES AND REGULATIONS. Manager shall, from time
to time as necessary, recommend to the Association that it amend, modify or
supplement the Rules and Regulations.
(D) ROSTER OF OWNERS. Manager shall annually compile
a complete and accurate roster of owners of Units ("Owners") setting forth the
name of each Owner. Manager shall also maintain a record of the mailing address
of each Owner as provided in the Bylaws.
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(E) EXCHANGE SERVICES. The Manager shall have no
authority with respect to the administration of any external exchange programs
operated by independent corporations, other than to communicate with
representatives of such exchange programs regarding the reservations processed
at the Property by or for such exchange programs.
4.3 FISCAL SERVICES. Manager shall, in addition to the duties
in ss. 4.1, subject to the supervision of the Association, provide the following
services of a fiscal nature:
(A) BUDGETS. Manager shall, prior to the beginning of
each calendar year, prepare and submit to the Board for approval, a budget
meeting the requirements of the Declaration. Each budget approved by the Board
is called the "Budget." Manager shall distribute or cause to be distributed a
copy of the approved Budget to all Owners.
(B) SPECIAL ASSESSMENTS. Manager shall determine
whether or not a Special Assessment may be required from time to time and shall
submit a recommendation to the Board that a Special Assessment be levied.
(C) COLLECTION OF ASSESSMENTS. Manager shall collect
the Assessments on behalf of the Association and enforce payment of Assessments
as follows:
(i) Manager shall cause to be prepared and
mailed to all Owners periodic statements setting forth the amount of all
Assessments then due from each Owner;
(ii) Manager shall cause to be prepared and
mailed to any delinquent Owner a notice of delinquency and shall use its best
efforts lawfully to collect delinquent Assessments as provided in the
Declaration. The Board on behalf of the Association hereby assigns to Manager,
subject to Manager agreeing to accept such assignment at its sole option and
paying any amount in default at the sole option of Manager, any lien placed by
the Association against an Owner's interest for non-payment of dues or fees owed
by the Association. The Manager shall have the right, but not the duty, to pay
said lien out of its own funds and to foreclose the lien or accept a deed in
lieu thereof and thereby acquire ownership of said defaulting owner(s) interest
in the Unit.
(D) BANK ACCOUNTS. Manager shall establish and
maintain the bank accounts provided for in the Declaration or Bylaws and shall
deposit funds collected from Owners and all other amounts collected by Manager
in connection with the performance of its duties hereunder in the accounts
designated for such purpose as set forth in the Declaration or Bylaws. The Board
shall authorize one or more of Manager's officers to have full signatory
authority on said bank accounts. In addition, the Manager shall keep accurate
books and records reflecting the amount of such accounts.
(E) DISBURSEMENTS. Manager shall disburse from the
bank accounts of the Association any and all amounts required for the payment of
all Association expenses incurred consistent with the applicable Budget and as
otherwise permitted by the Declaration or Bylaws.
(F) FINANCIAL STATEMENTS. Manager shall, after the
end of each calendar year, prepare and distribute the Annual Report to each
Owner in accordance with the Declaration or Bylaws. Manager shall provide
quarterly reports to the Board.
(G) BOOKS AND RECORDS. Manager shall keep and
maintain or cause to be kept and maintained full and adequate books and records
reflecting the results of operation of the Property in accordance with the
accounting principles utilized by the Association in the preparation of its
federal income tax returns. The books of account and other records relating to
the operation of the
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Property shall be available to the Association and the Members at all reasonable
times for examination and inspection as and to the extent provided in the
Bylaws.
(H) INTERNAL EXCHANGE. Manager shall enter the
Property into Manager's Internal Exchange network. Each Owner exchanged into one
of Manager's resort properties that constitute the Internal Exchange shall be
subject to all Internal Exchange rules, regulations and fees as set forth in
Manager's Timeshare Exchange Disclosure.
4.4 PHYSICAL SERVICES. Manager shall, in addition to the
duties in ss. 4.1, provide the following services of a physical nature:
(A) INSPECTIONS. Manager shall make regular
inspections of the Property and render reports and make recommendations
concerning the Property to the Board.
(B) ASSOCIATION INSURANCE. Manager shall use its best
efforts to procure and keep in force all insurance and/or bonds required. In the
event said insurance and/or bonds are not ascertainable, Manager shall notify
the Board at once. Manager shall administer all such insurance and claims under
such insurance policies. Such insurance shall include, but shall not be limited
to:
(i) A policy of insurance showing the
Association as the named insured, and Manager as an additional insured,
evidencing that the Association is insured under the laws of the State of
Louisiana in accordance with the provisions of the applicable statutes;
(ii) A policy or policies of insurance
showing the Association as the named insured, evidencing that the Association is
insured against loss from embezzlement, misappropriation and misapplication of
funds by the Association's employees retained by Manager, in an amount
satisfactory to the Louisiana Division of Real Estate and to the equivalent
agency of any other state in which Hotel Maison Xxxxxx Xxxxxxx, Ltd., a
Louisiana corporation (the "Developer") registers the Property for sale. Manager
shall use its best efforts to insure that all such policies provide that the
same shall not be canceled except upon thirty (30) days prior written notice to
the Association.
(C) REPAIR AND MAINTENANCE OF PROPERTY AND
FURNISHINGS. Manager shall cause the Property and the Common Furnishings to be
repaired and maintained, in accordance with the provisions of the Declaration.
(D) CHECK IN AND CHECK OUT. Manager shall cause
on-site personnel to be available at all required times in order to check Owners
and/or their Occupants in or out. Manager shall engage Xxxxxx Xxxxxxxx to manage
the Property as Property Manager and operate the front desk and other aspects of
the Property as designated by the Property Manager either directly or by
delegation to other employees of Manager or the Association.
(E) RESERVATIONS. Manager shall establish and operate
a reservation system. The reservation system shall include the books and records
required to reflect reservations made, Units actually used and such other
information as shall be necessary to efficiently coordinate Property operations.
4.5 LIMITATION ON POWERS OF MANAGER. Notwithstanding the
powers of the Manager as set forth in xx.xx. 4.1-4.4 above, Manager shall nOT:
(A) Enter into a contract with a third person or
entity whereby such person or entity will furnish goods or services to the
Property for a term longer than one (1) year unless authorized by a majority of
non-Developer Owners except:
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(i) A contract with a public utility company
if the rates charged for the materials or services are regulated by the State of
Louisiana or an agency thereof; provided, however, that the term of the contract
shall not exceed the shortest term for which the supplier will contract at the
regulated rate.
(ii) Prepaid or partially prepaid
casualty or liability insurance policies not to exceed three (3) years duration
provided that the policy permits short-rate cancellation by the insured.
(iii) One or more agreements providing for
the implementation of exchange programs at the Property; or
(B) Enter into a contract or lease for a period not
exceeding five (5) years without the Board's written consent, except:
(i) Leases of furnishings;
(ii) Leases of the exclusive easement
areas or portion thereof;
(iii) Leases for laundry room fixtures,
equipment and service;
(iv) Agreements for cable television
service or satellite dish equipment and service; and
(v) Agreements for burglar alarm
equipment and service.
Subject to the Board's written consent, Manager may engage a contractor or
lessor in which the Developer or the Manager has a direct or indirect interest
of 10% or more.
(C) Enter into any contract in the name of the
Association for goods or services not contemplated by the Budget or for amounts
in excess of those specified in the Budget, unless the Board shall consent
thereto in writing. This amount approved by the Board cannot be an amount which
would require approval of such assessment by the Majority of Owners.
4.6 LIMITED LIABILITY. Manager shall not be responsible for
the acts, omissions to act or conduct of any of the Owners, other Property
occupants and/or exchange users, or for the breach of any of the obligations of
any of the Owners, occupants and/or exchange users. The Association agrees to
indemnify and hold harmless Manager for all acts of Manager in its performance
of the duties hereunder other than from liability arising as a result of
Manager's gross negligence or unlawful misconduct.
5. COMPENSATION OF MANAGER.
5.1 MONTHLY COMPENSATION. For Manager's full and faithful
performance of the duties and obligations provided for herein, Manager shall,
during the term hereof, be entitled to a monthly compensation (the "Management
Fee") in an amount equal to one-twelfth of fifteen percent (15%) of the total
Budget plus three percent (3%) of all Net Processed Volume on sales of Property
Units derived from any sales source whatsoever. Net Processed Volume means the
sum of sales prices on processed agreements for sales of Units, calculated
monthly by Developer and delivered to Manager on or before the tenth (10th) day
of the following month, along with any funds owed Manager. Manager may audit any
said report(s) at any time. In the event of termination or resignation of this
Agreement, during or after the Transition Period, pursuant to the provisions
stated herein, unless agreed to by
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Manager, the Property and Association will immediately discontinue use of the
Ramada Vacation Suites name. All Manager compensation stated herein is exclusive
of any other Manager compensation.
5.2 ADVANCES AND REIMBURSEMENTS. In addition to the Management
Fee, Manager shall be paid or reimbursed from the bank accounts of the
Association an amount equal to all out-of-pocket expenses incurred by Manager in
connection with this Agreement and/or the performance of the duties or
obligations provided for herein. Manager shall not be required to perform any
act or duty hereunder involving an expenditure of money unless there shall be
sufficient funds therefor in the bank accounts of the Association. If at any
time the funds in the bank accounts of the Association are not sufficient to pay
the obligations, expenses and all charges incident to this Agreement,
Association shall make available such funds. Manager, although not obligated to
do so, may advance such sums as it deems necessary, and in such event, Manager
shall be entitled to reimburse itself from Association funds for the amount of
such advances, together with interest at the rate of fifteen percent (15%) per
annum, or such lesser rate as allowed under the usury laws of Louisiana,
commencing from the date of the advance by Manager.
5.3 PAYMENT OF MANAGEMENT FEE. Manager is hereby authorized to
pay itself the Management Fee of fifteen percent (15%) of the total Budget out
of the Association bank account(s), or other available Association funds. The
three percent (3%) of Net Processed Volume will be paid to Manager on a monthly
basis by Developer. Any shortfall of any funds owed Manager shall be paid by
Developer upon demand.
5.4 DISCOUNTS. All discounts, rebates or commissions or like
items shall inure to the benefit of the Association. Rentals of timeshare weeks
owned by Manager may be rented for the benefit of the Manager.
5.5 EMPLOYEES. Each employee, independent contractor or other
person performing services for the Association in connection with this Agreement
(the "Association Employee") shall, even though retained by Manager, be the
employee, agent or independent contractor of the Association and not of Manager.
The salary and other related expenses (including, without limitation, payroll
taxes and the cost of employee benefits) or other compensations for any
Association employee shall be an expense of the Association even though paid by
Manager, and Manager shall be entitled to reimbursement from funds of the
Association on a monthly basis for such expenditures, which reimbursement shall
be in addition to and separate from the amount paid to Manager pursuant to 5.1
above. Any such sums advanced by Manager and not repaid within thirty (30) days
of such advances, shall earn interest at fifteen percent (15%) per annum, or
such lesser rate as allowed by the laws of the State of Louisiana, from the date
of any such advance.
5.6 SINGLE CONTRACTS. Manager may enter into single contracts
for operation and maintenance services covering the Property and other projects
managed by the Manager.
6. NOTICES. Any notice, request, demand, instruction or other document
to be given hereunder to any party shall be in writing and shall either be
delivered in the manner and to the person at the appropriate address set forth
below:
If to Association: Attention: Xxxxxx X. Xxxxxxxx, President
000 Xxxxxxxxxx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxx 00000
Facsimile: (000) 000-0000
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With a copy to: Hotel Maison Xxxxxx Xxxxxxx, Ltd.
Attention: Xxxxxx X. Xxxxxxxx, President
000 Xxxxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxx 00000
Facsimile: (000) 000-0000
and to Xxxxxx X. XxXxxxx at the
address shown below
If to Manager: Preferred Equities Corporation
Attention: Xxxxxx X. XxXxxxx,
Director: Resort Operations
0000 Xxxx Xxxxxxxxx Xxxxxx
Xxx Xxxxx, Xxxxxx 00000
Facsimile: (000) 000-0000
With a copy to: Preferred Equities Corporation
Attention: Xxxxxxx X. Xxxxxx,
Asst. General Counsel
0000 Xxxxxxxx Xxxx
Xxx Xxxxx, Xxxxxx 00000
Facsimile: (000) 000-0000
Any notices required or permitted to be given under this Agreement shall be in
writing and shall be deemed to have been given 48 hours after the deposit of
same in any United States mail post office box in the state to which the notice
is addressed or 72 hours after deposit in any such post office box other than in
the state to which the notice is addressed. Any notices sent shall be delivered
by hand, sent by recognized overnight courier (such as Federal Express), sent by
facsimile transmission, or mailed by certified or registered mail, return
receipt requested, in a postage prepaid envelope, and addressed as set forth
above. The addresses and addressees for the purpose of this paragraph may be
changed by giving notice of such change in the manner herein provided for giving
notice. Unless and until such notice is received, the last address and addressee
stated by notice, or as provided herein if no notice or change has been sent or
received, shall be deemed to continue in effect for all purposes hereunder.
7. WAIVER. The waiver or failure to enforce any provision of this
Agreement shall not operate as a waiver of any future breach of such provision
or of any other provisions hereof.
8. MERGER. All understandings and agreements heretofore had between
the parties respecting the employment contemplated by this Agreement are merged
in this Agreement, which fully and completely expresses the agreement of the
parties. There are no agreements except as specifically set forth in this
Agreement or to be set forth in the instruments or other documents delivered or
to be delivered hereunder.
9. AMENDMENTS. No change in or addition to, or waiver or termination
of, this Agreement or any part thereof shall be valid unless in writing and
signed by or on behalf of each of the parties hereto.
10. PARAGRAPH HEADINGS. The paragraph headings herein contained are for
the purposes of identification only and shall not be considered in construing
this Agreement.
11. SUCCESSORS AND ASSIGNS. All of the terms and provisions of this
Agreement shall be binding upon and inure to the benefit of and be enforceable
by the parties and each of their respective successors and assigns. In no event
shall the obligations or duties of Manager be assigned, except as provided in
ss. 4.1, without the prior written consent of the Association.
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12. SEVERABILITY - Every provision of this Agreement is intended to be
severable. If any term or provision hereof is illegal or invalid for any reason
whatsoever, such illegality shall not affect the validity of the remainder of
the within Agreement.
13. GOVERNING LAW - This Agreement shall be governed and interpreted by
the laws of the State of Nevada.
14. DISPUTE RESOLUTION/ARBITRATION - In the event of any controversy,
claim or dispute between the parties hereto arising out of or relating to this
Agreement or the breach thereof ("Disputed Matter"), the parties to this
Agreement hereby waive their right to litigation proceedings in a court of law
and agree that any such Disputed Matter shall be settled first by mediation and,
if unsuccessful, by binding arbitration, the fee for which shall be advanced by
the party requesting mediation or arbitration. The cost of the proceeding shall
ultimately be borne as determined by the mediator or arbitrator The site of any
such mediation or arbitration proceeding shall be Xxxxx County, Nevada. In the
event any Disputed Matter cannot be resolved by mediation or binding
arbitration, or in the event the parties' waiver of litigation proceedings is
considered invalid for any reason, venue for any litigation proceeding shall be
Xxxxx County, Nevada.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed on the date first above written.
HOTEL MAISON XXXXXX XXXXXXX, LTD.
OWNERS ASSOCIATION
By:
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XXXXXX X. XXXXXXXX
President
PREFERRED EQUITIES CORPORATION,
a Nevada corporation
By:
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XXXXX X. XX XXXXXXX
Executive Vice President
In consideration of this Agreement, Xxxxxx X. Xxxxxxxx hereby
personally guarantees the performance of all Association duties and the payment
of any and all fees owed by the Association and Developer to Manager under this
Agreement or as may be otherwise agreed to between Manager and Developer or
Association.
By:
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XXXXXX X. XXXXXXXX, Individually
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