**Exhibit 10.110**

 

*Michael W. Reschke*

*Chairman of the Board*

*ChiefExecutive Officer*

 

 

June 11, 2003

 

 

Gary J. Skoien

 

 

 
| RE: |   | **Amendment  to Net Profits Interest In Huntley Development Limited Partnership and  Huntley Meadows Residential Venture** |
|-----|--------|----------------------------------------------------------------------------------------------------------------------------|

 

Dear Gary:

 

Reference is hereby made to that certain letteragreement, dated October 29, 2001 (the “10/29/01 Letter”), assubsequently amended, between you and The Prime Group, Inc.  Capitalized terms used in this letter thatare no specifically defined in this letter, but that are defined in the10/29/01 Letter, shall have the meanings given such term in the 10/29/01Letter.

 

The 10/29/01 Letter, in part, provides that you areentitled to a certain percent of the net proceeds received by Prime from HDLPand HMRV (the “GJS Huntley Net Profits Interest”).  The purpose of this letter is to amend andrestate the portion of the 10/29/01 Letter to clarify terms of the 10/20/01Letter relating to the GJS Huntley Net Profits Interest.  Attached hereto is the amended and restated provisionsrelating to the GJS Huntley Net Profits Interest.

 

Please execute and return to me one copy of thisletter indicating your agreement to and acceptance of the amended and restatedprovisions relating to of the GJS Huntley Net Profits Interest.

 

Sincerely,

 
| /s/ Michael W. Reschke                              |
|-----------------------------------------------------|
|                                                |
| Michael W. Reschke                                  |
| Chairman                                            |
|                                                |
| Accepted and Agreed to this 11th day of June, 2003. |
|                                                |
| /s/ Gary J. Skoien                                  |   |
| Gary J. Skoien                                      |

** **

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**Net Profits Agreement**

 

As provided in that certain letter agreement, datedOctober 29, 2001 (the “10/29/01 Letter”) Gary J. Skoien, between (“Skoien”)and The Prime Group, Inc. (“PGI”), Skoien was granted an interest (the “GJSHuntley Net Profits Interest”) in the net proceeds generated by HuntleyDevelopment Limited Partnership (“HDLP”) and Huntley Meadows ResidentialVenture (“HMRV”; HDLP and HMRV are sometimes referred to herein,together, as the “Partnerships”) upon and subject to the terms andconditions set forth in the 10/29/01 Letter. PGI and Skoien have agreed to clarify the provisions set forth in the10/29/01 Letter concerning the GJS Huntley Net Profits Interest so that the GJSHuntley Net Profits Interest is determined as follows:

 

(a)           TheGJS Huntley Net Profits Interest shall consist of a participation in the NetCash Flow (as defined below) distributed to the equity partners in thePartnerships (the “Equity Partners”) equal to nine and six hundredseventy five one thousandths percent (9.675%) of the cash distributed to theEquity Partners from either of the Partnerships (excluding distributions  paid to the Equity Partners in the aggregateamount of all Approved Contributions (as hereinafter defined) contributed oradvanced by any Equity Partner to either of the Partnerships after June 13, 2003,plus a return on such amount calculated at the greater of (A) the Prime Rate ofInterest (as hereinafter defined) plus 1% or (B) eight percent (8%) per annum,compounded annually, from the date such amount is contributed or advanced, asthe case may be, until such amount is repaid).

 

(b)           Forpurpose hereof, the term “Prime Rate of Interest” shall mean the annualrate of interest as indicated on the Bloomberg web site(http://www.bloomberg.com/markets/rates/index.html) under the heading “PrimeRate”.  Such rate shall be adjustedquarterly on the first day of each calendar quarter.

 

(c)           The Partnerships shall distribute anyamounts due in respect to the GJS Huntley Net Profits Interest on a semi-annualbasis.

 

(d)           Noportion of the real property owned by either Partnership (the “Real Property”),the Tax Increment Alternative Revenue Bonds (Huntley Redevelopment Project),Series C-1995 (the “Series C TIF Bonds”), owned by HDLP or other assetsor interests of either Partnership shall be sold, assigned, conveyed orotherwise transferred to any person or entity affiliated directly or indirectlywith any Equity Partner unless the Partnership receives at the time of suchsale, assignment, conveyance or other transfer an amount in cash equal to thefair market value of such property.

 

(e)           The Equity Partners shall not causeor permit either Partnership to pay any fees or expenses (including anymanagement, consulting, service, advisory, brokerage or other fee) to anyPerson affiliated directly or indirectly with any Equity Partner except for allcosts of

 

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employees, including bonus, commissions and benefitsand other allocable costs, which shall be charged to the Partnerships in amanner consistent with past practices.

 

(f)            If either Partnership or any EquityPartner grants any further profit, participation or other similar interest inthe profits or cash flows of either Partnership, then for purposes ofcalculating the GJS Huntley Net Profits Interest, the 9.675% interest in thecash distributed by either Partnership to the Equity Partners shall in allevents be calculated prior to factoring in (*i.e.*, prior to giving effect to) anypayments or distributions to be made by either Partnership or any EquityPartner pursuant to such further granted profit, participation or other similarinterest; provided, that Net Cash Flow shall not include proceedsreceived by either Partnership or any Equity Partner for any further profit,participation or other similar interest in the profits or cash flows of eitherPartnership.

 

 (g)          For purposes hereof, the term “Net Cash Flow” means,with respect to either Partnership, the excess, if any, as of such date, (i) ofthe gross cash receipts generated by such Partnership from and after June 13,2003, from all sources whatsoever, including, without limitation, thefollowing:

 

(A)          all rents, revenues, income andproceeds derived by such Partnership from its operations, including, withoutlimitation, distributions received by such Partnership from any entity in whichsuch Partnership has an interest; (B) all proceeds and revenues received bysuch Partnership on account of any sales of property of such Partnership or asa refinancing of or payments of principal, interest, costs, fees, penalties orotherwise on account of any borrowings or loans made by such Partnership orfinancings or refinancings of any property of such Partnership or the sale ofany of the Series C TIF Bonds or sale of any tax increment financing bondshereafter issued with respect to any of the Real Property; (C) the amount ofany insurance proceeds and condemnation awards received by such Partnership;(D) any reduction in the cash amounts previously reserved by the Partnershipand described in subsection (ii)(E) below, if the Equity Partnersdetermine that such amounts are no longer needed; (E) the return of cashcollateral pledged with respect to the Tax Increment Allocation Revenue Bonds(Huntley Redevelopment Project) Series B-1995 (“Series B TIF Bonds”) orthe Series C TIF Bonds; and (F) the proceeds of liquidation of suchPartnership’s property,

 

over (ii) the sum of:

 

(A) all operatingcosts and expenses of such Partnership and capital expenditures paid (withoutdeduction, however, for any capital expenditures, charges for depreciation orother expenses not paid in cash or expenditures from reserves described inclause (E) below); (B) to the extent not included in any other clause of this subparagraph(ii), all costs and expenses expended or paid during such period inconnection with the sale or other disposition, or financing or refinancing, ofproperty of such Partnership or the recovery of insurance or condemnationproceeds; (C) to the extent not included in any other clause of this subparagraph(ii), all debt service, including principal and interest, paid on allindebtedness of such Partnership, including any payments made or cashcollateral pledged pursuant to the terms of any loan made by Beal Bank, S.S.B.to either

 

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one or both of the Partnerships, the Series B TIF Bonds and the SeriesC TIF Bonds; (D) all capital contributions, advances, reimbursements or similarpayments made to any entity in which such Partnership has an interest; (E) anyincreases in mandatory reserves necessary for debt service or other purposesfor such Partnership or any entity in which such Partnership has an interest;and (F) any payments made pursuant to the terms of the interest held by BealBank, S.S.B. in the Partnerships or in the net profits of the Partnerships.

 

(h)           Forpurposes hereof, the terms “Approved Contributions” means any capitalcontributions made by any Equity Partner to the Partnerships that are used tomake or maintain improvements to the Real Property or for any other good faithbusiness purpose directly related to or for the benefit of the Real Property orother assets of either Partnership.

 

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