Exhibit 10.26


 


SERVICES AGREEMENT


 


THIS SERVICES AGREEMENT (this “Agreement”) is
entered into as of November 29, 2005 by and among REPUBLIC PROPERTIES
CORPORATION, a District of Columbia corporation (“RPC”),
RICHARD L. KRAMER (“Kramer”),
STEVEN A. GRIGG (“Grigg”,
together with Kramer and RPC, the “General Partners”)
and REPUBLIC PROPERTY LIMITED PARTNERSHIP, a Delaware limited partnership (the “Operating Partnership”).


 


WHEREAS, in connection with the initial public offering (the “IPO”) of the common shares of beneficial interest, par value
$.01 per share, of Republic Property Trust, a Maryland real estate investment
trust (“Republic”), Republic and the Operating
Partnership and their affiliates will complete a series of related transactions
(collectively with the IPO, the “IPO Transactions”);


 


WHEREAS, pursuant to the Agreement of Limited Partnership of Portals
Development Associates Limited Partnership (the “Partnership
Agreement”), a District of Columbia limited partnership (“PDA”), the General Partners, in connection with their
positions as general partners of PDA, provide certain asset management services
to PDA, including, but not limited to, the arrangement of financing and the
administration of loans, the oversight of PDA’s partnership books and records,
the preparation of quarterly distributions to be made by PDA to its partners,
certain accounting, bookkeeping and other administrative services with respect
to those certain real estate properties located in the District of Columbia
known as The Portals I, The Portals II, The Portals III, The Portals IV and The
Portals V and in which PDA, directly or indirectly through one or more
intermediary entities, owns an ownership interest, and the preparation of
documents in connection with the annual audit and tax return of PDA
(collectively, the “Services”);


 


WHEREAS, in connection with
the IPO Transactions, each General Partner desires to engage the Operating
Partnership to provide the Services to PDA in return for the payment set forth
herein; and


 


NOW THEREFORE, in consideration of the foregoing and
the mutual covenants and conditions set forth herein and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:


 


ARTICLE I:  ENGAGEMENT; PAYMENT OF FEES


 


1.1           Engagement.  Subject to the terms and conditions
hereof, the General Partners hereby engage the Operating Partnership to provide
to PDA the Services pursuant to the Partnership Agreement (the “Services Duties”) from and after the
Closing (as defined in Article V below).


 





















 


1.2           Payment for Services.  In consideration of the performance of
the Services by the Operating Partnership (or its affiliates), the General
Partners shall pay or cause to be paid to the Operating Partnership (or its
affiliates) an amount equal to the “Services
Payment.”  The Services
Payment shall be an amount equal to $91,667 per calendar month from and after
the Closing, payable on the 15th day of each month; provided,
however, that commencing on the first anniversary of the Closing, the parties
hereto may revise the amount of such Services Payment on an annual basis so
long as the “independent” members of the Board of Trustees of Republic (as
defined in Republic’s bylaws) approve such revised Services Payment amount.


 


1.3           Prohibition on Funding/Fee Disputes


 


(a)           Republic
acknowledges that it and its subsidiaries (including the Operating Partnership)
shall be prohibited from providing any funding, payments, credit, equity
investments or any other financial assistance to PDA, and that Republic shall
undertake all commercially reasonable efforts to promptly collect all monies
due pursuant to the terms hereof.


 


(b)           In the event that
any material fee dispute arises between the General Partners and Republic with
respect to any of the services to be provided to PDA pursuant to the terms
hereof, the “independent” members of the Board of Trustees of Republic (as
defined in Republic’s bylaws) shall undertake all commercially reasonable
efforts to promptly resolve any such fee dispute with the General Partners.


 


1.4           Term.   The term of this Agreement shall continue
until the one year anniversary date of the Closing (as defined in Section 5.1
below) (the “Initial Term”), and, after the
expiration of the Initial Term, this Agreement shall be renewed automatically
for successive additional terms of one (1) year each (the “Subsequent Term”), in each case unless sooner terminated in
the manner provided in Section 6.9 hereof.


 


ARTICLE II:  REPRESENTATIONS AND WARRANTIES 

OF GENERAL PARTNERS


 


As a material inducement to
the Operating Partnership to enter into this Agreement and to consummate the
transactions contemplated hereby, each of the General Partners hereby makes to
the Operating Partnership each of the representations, warranties and covenants
set forth in this Article II (other than any specific representations,
warranties or covenants relating solely to RPC).  The representations and warranties set forth
in this Article II are true and correct as of the date hereof.


 


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2.1           Organization and Standing.  RPC is a corporation duly organized, validly
existing and in good standing under the laws of the District of Columbia, is in
good standing and is duly qualified and authorized to transact the business
which it presently conducts, in all jurisdictions in which such qualification
is required.


 


2.2           Authority. 
The General Partners have full right, authority, power and/or capacity (a) to
enter into this Agreement and each agreement, document and instrument to be
executed and delivered pursuant to this Agreement; (b) to carry out the
transactions contemplated hereby and thereby; and (c) to engage the
Operating Partnership to perform the Services Duties in accordance with this
Agreement.  This Agreement and each
agreement, document and instrument executed and delivered by or on behalf of
each General Partner pursuant to this Agreement constitutes, or when executed
and delivered will constitute, the legal, valid and binding obligation of such
General Partner, each enforceable in accordance with its respective terms.


 


2.3           Noncontravention.  Neither the entry into nor the performance
of, or compliance with, this Agreement by any General Partner has resulted, or
will result, in any violation of, or default under, or result in the
acceleration of, any obligation under its charter or any material mortgage,
indenture, lien agreement, note, contract, permit, judgment, decree, order,
restrictive covenant, statute, rule, or regulation applicable to such General
Partner.


 


2.4           Litigation. 
There is no litigation or proceeding, either judicial or administrative,
pending or, to the General Partners’ knowledge, threatened, affecting all or
any portion of the Services Duties or the General Partners’ ability to
consummate the transactions contemplated hereby.  There is no outstanding order, writ,
injunction or decree of any court, government, governmental entity or authority
or arbitration against or affecting all or any portion of the Services Duties,
which in any such case would impair the General Partners’ ability to enter into
and perform all of such General Partner’s obligations under this Agreement.


 


2.5           No Insolvency Proceedings.  No attachments, execution proceedings,
assignments for the benefit of creditors, insolvency, bankruptcy,
reorganization or other proceedings are pending or, to the knowledge of RPC,
threatened against RPC, nor are any such proceedings contemplated by any
General Partner.


 


2.6           No Brokers. 
No General Partner has entered into, and each General Partner covenants
that it will not enter into, any agreement, arrangement or understanding with
any person or firm which will result in the obligation of the Operating
Partnership to pay any finder’s fee, brokerage commission or similar payment in
connection with the transactions contemplated hereby (other than underwriting
fees paid in connection with the IPO).


 


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2.7           Consents.  Except as may otherwise be set
forth in this Agreement, each consent, approval, authorization, order, license,
certificate, permit, registration, designation, or filing by or with any governmental
agency or third party necessary for the execution, delivery, and performance of
this Agreement or the transactions contemplated hereby by the General Partners
has been obtained or will be obtained on or before the Closing.


 


2.8           Reliance. 
Each General Partner acknowledges that the Operating Partnership may
rely upon the representations and warranties in this Article II in determining
whether to enter into this Agreement. 
Each General Partner agrees, severally and not jointly, to indemnify,
defend and hold harmless the Operating Partnership and the officers, directors
and affiliates thereof, and any employees or agents of any of the foregoing,
against any and all loss, liability, claim, damage or expense whatsoever
(including, but not limited to, any and all expenses, including attorneys’
fees, reasonably incurred in investigating, preparing or defending against any
claim or litigation commenced or threatened) due to or arising out of a breach
by such General Partner of any such representations or warranties (other than
with respect to any representation, warranty or covenant relating solely to
RPC).


 


2.9           Partnership Agreement.  The Partnership Agreement is in full force and
effect and none of the General Partners are in default thereunder.


 


ARTICLE III: 
REPRESENTATIONS AND WARRANTIES

OF THE OPERATING PARTNERSHIP


 


As a material inducement to
the General Partners to enter into this Agreement and to consummate the
transactions contemplated hereby, the Operating Partnership hereby makes to the
General Partners each of the representations, warranties and covenants set
forth in this Article III.  The
representations and warranties set forth in this Article III are true and
correct as of the date hereof.


 


3.1           Organization and Standing.  The
Operating Partnership is a limited partnership duly organized, validly existing
and in good standing under Delaware law, and has the requisite partnership
power and authority to own and operate its assets, to carry on its business as
currently conducted, to execute and deliver this Agreement and to carry out the
transactions contemplated hereby.  The
Operating Partnership is duly qualified to conduct business as a foreign
partnership where necessary and is in good standing in the states in which it
is so qualified.


 


3.2           Authority. 
The Operating Partnership has full right, authority, power and capacity (a) to
enter into this Agreement and each agreement, document and instrument to be
executed and delivered by or on behalf of the Operating


 


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Partnership pursuant to this
Agreement; and (b) to carry out the transactions contemplated hereby and
thereby.  This Agreement and each
agreement, document and instrument executed and delivered by or on behalf of
the Operating Partnership pursuant to this Agreement constitutes, or when
executed and delivered will constitute, the legal, valid and binding obligation
of the Operating Partnership, each enforceable in accordance with its
respective terms.


 


3.3           Noncontravention.  Neither the entry into nor the performance
of, or compliance with, this Agreement by the Operating Partnership has
resulted, or will result, in any violation of, or default under, or result in
the acceleration of, any obligation under its agreement of limited partnership
or any material mortgage, indenture, lien agreement, note, contract, permit,
judgment, decree, order, restrictive covenant, statute, rule, or regulation
applicable to the Operating Partnership.


 


3.4.          Litigation.  There is no litigation or proceeding, either
judicial or administrative, pending or, to the Operating Partnership’s
knowledge, threatened, affecting the Operating Partnership’s ability
to consummate the transactions contemplated hereby.  There is no outstanding order, writ,
injunction or decree of any court, government, governmental entity or authority
or arbitration which would materially impair the Operating Partnership’s ability
to enter into and perform all of the Operating Partnership’s obligations
under this Agreement.


 


3.5           No Brokers. 
The Operating Partnership has not entered into, and covenants that it
will not enter into, any agreement, arrangement or understanding with any
person or firm which will result in the obligation of the General Partners to
pay any finder’s fee, brokerage commission or similar payment in connection
with the transactions contemplated hereby.


 


3.6           Consents.
Except as may otherwise be set forth in this Agreement, each consent, approval,
authorization, order, license, certificate, permit, registration, designation,
or filing by or with any governmental agency or body necessary for the
execution, delivery, and performance of this Agreement or the transactions
contemplated hereby by the Operating Partnership has been obtained or will be
obtained on or before the Closing.


 


3.7           Reliance.  The Operating Partnership acknowledges that
the General Partners may rely upon the representations and warranties in this Article III
in determining whether to enter into this Agreement.  The Operating Partnership agrees to
indemnify, defend and hold harmless the General Partners and the officers,
directors and affiliates thereof, and any employees or agents of any of the
foregoing, against any and all loss, liability, claim, damage or expense
whatsoever (including, but not limited to, any and all expenses, including
attorneys’ fees, reasonably incurred in investigating, preparing or defending
against any claim


 


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or
litigation commenced or threatened) due to or arising out of a breach of any
such representations or warranties.


 


ARTICLE IV:  CONDITIONS TO
CLOSING


 


4.1           Conditions to the Operating Partnership’s Obligation to
Close.  The obligation of the
Operating Partnership to consummate the Closing is subject to the fulfillment,
at or prior to the Closing, of the following conditions (unless such conditions
are waived in writing by the Operating Partnership):


 


(a)           IPO Transactions. 
The IPO Transactions shall have occurred (or shall be occurring
simultaneously with the Closing).


 


(b)           Representations and Warranties.  The representations and warranties made by
the General Partners pursuant to this Agreement shall be true and correct in
all material respects when made, and on and as of the Closing, as though such
representations and warranties were made on the Closing.


 


(c)           Performance. 
The General Partners shall have performed and complied with all
agreements and covenants that each of them is required to perform or comply
with pursuant to this Agreement prior to the Closing in all material respects.


 


(d)           Legal Proceedings. 
No order, statute, rule, regulation, executive order, injunction, stay,
decree, or restraining order shall have been enacted, entered, promulgated or
enforced by any court of competent jurisdiction or governmental entity that
prohibits the consummation of the transactions contemplated hereby, and no
litigation or governmental proceeding seeking such an order shall be pending or
threatened.


 


(e)           Consents and Approvals.  All necessary consents of governmental and
private parties to effect the transactions contemplated by this Agreement shall
have been obtained.


 


(f)            Partnership Agreement.  The Partnership Agreement is in full force
and effect and none of the General Partners are in default thereunder.


 


4.2           Conditions to the General Partners’ Obligation to Close.  The obligation of the General Partners to
consummate the Closing is subject to the fulfillment, at or prior to the
Closing, of the following conditions (unless such conditions are waived in
writing by the General Partners):


 


(a)           Representation and Warranties.  The representations, warranties and covenants
of the Operating Partnership contained in this Agreement shall be true and
correct as of the Closing.


 


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(b)           Performance. 
The Operating Partnership shall have performed and complied with all
agreements and covenants that it is required to perform or comply with pursuant
to this Agreement prior to the Closing in all material respects.


 


(c)           Legal Proceedings. 
No order, statute, rule, regulation, executive order, injunction, stay,
decree, or restraining order shall have been enacted, entered, promulgated or enforced
by any court of competent jurisdiction or governmental entity that prohibits
the consummation of the transactions contemplated hereby, and no litigation or
governmental proceeding seeking such an order shall be pending or threatened.


 


(d)           Consents and Approvals.  All necessary consents of governmental and
private parties to effect the transactions contemplated by this Agreement shall
have been obtained.


 


4.3           Further Assurances. 
Each of the parties herein shall execute and deliver all such other and
further instruments and documents and take or cause to be taken all such other
and further actions that any other party may reasonably request in order to
effect the transactions contemplated by this Agreement.


 


ARTICLE V:  CLOSING


 


5.1           Closing.  The
closing hereunder (the “Closing”) shall
occur on the same day as the closing of the IPO, as close in time to the
closing of the IPO as is reasonably practicable under the circumstances.


 


ARTICLE VI:  MISCELLANEOUS


 


6.1           Term of
Agreement.  This Agreement may be terminated by the
mutual consent of the parties at any time before the Closing.  If the Closing does not occur by September 30,
2006, this Agreement shall be deemed terminated and shall be of no further
force and effect and neither the Operating Partnership nor the General Partners
shall have any further obligations pursuant to this Agreement except as
specifically set forth in this Agreement.


 


6.2           Amendment; Consent of Independent Trustees; Waiver.  Any amendment hereto shall be effective only if
signed by all parties hereto.  Any
amendment hereto after the date of Closing is subject to the
pre-approval of a majority of the “independent” members of the Board of
Trustees of Republic (as defined in Republic’s bylaws), as general partner of
the Operating Partnership, and no amendment may occur without such
pre-approval.  No waiver of any provisions of this Agreement
shall be valid unless in writing and signed by the party against whom
enforcement is sought.


 


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6.3           Entire Agreement; Counterparts; Applicable Law.  This Agreement (a) shall, together with
the Partnership Agreement, constitute the entire agreement and supersedes all
prior agreements and understandings, both written and oral, among the parties
with respect to the subject matter hereof, (b) may be executed in one or
more counterparts, each of which will be deemed an original and all of which
shall constitute one and the same instrument, and (c) shall be governed in
all respects, including validity, interpretation and effect, by the laws of the
State of Delaware without giving effect to the conflict of law provisions
thereof.


 


6.4           Assignability. 
This Agreement shall be binding upon, and shall be enforceable by and
inure to the benefit of, the parties hereto and their respective successors and
assigns; provided, however, that this Agreement may not be assigned (except by
operation of law) by any party without the prior written consent of the other
party, and any attempted assignment without such consent shall be void and of
no effect; provided further, that this Agreement may be assigned by the
Operating Partnership, without the prior written of the General Partners, in
whole or in part to Republic Property TRS, LLC, a Delaware limited liability
company and wholly owned subsidiary of the Operating Partnership, or to or
among any other wholly owned subsidiary of the Operating Partnership, Republic
or Republic Property TRS, LLC, and upon such assignment, the assignee shall
have the exclusive right and obligation to provide any services hereunder.


 


6.5           Severability. 
If any provision of this Agreement, or the application thereof, is for
any reason held to any extent to be invalid or unenforceable, the remainder of
this Agreement and application of such provision to other persons or
circumstances will be interpreted so as reasonably to effect the intent of the
parties hereto.


 


6.6           Equitable Remedies. 
The parties hereto agree that irreparable damage would occur if any
provision of this Agreement was not performed in accordance with its specific
terms or was otherwise breached.  It is
accordingly agreed that the parties shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions hereof in any federal or state court located in the
State of Delaware (as to which the parties agree to submit to jurisdiction for
the purposes of such action), this being in addition to any other remedy to
which they are entitled at law or in equity.


 


6.7           Survival.  It
is the express intention and agreement of the parties hereto that the
representations, warranties and covenants of the parties set forth in this
Agreement shall survive the consummation of the transactions contemplated
hereby.


 


6.8           Third Party Beneficiary.  Except as specifically set forth in this
Agreement, no provision of this Agreement is intended, nor shall it be
interpreted, to provide or create any third party beneficiary rights or other
rights of any kind in


 


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any customer, affiliate, stockholder, partner, member, director,
officer, or employee of any party to this Agreement or any other person or
entity.


 


6.9           Termination
of Services Duties.


 


(a)           If
either party materially breaches any provision of this Agreement, the breaching
party shall have the right to cure such breach within thirty (30) days of
receipt of written notice from the non-breaching party specifying the nature of
the alleged breach.  If the non-breaching
party gives the notice set forth in this Section 6.9(a) and the
breach is not cured within such thirty (30) day period, then this Agreement
shall be terminated unless otherwise agreed to in writing by each of the
parties hereto.


 


(b)  Either the General Partners,
together, or the Operating Partnership shall have the right to terminate its
obligations with respect to the Services Duties upon furnishing the other party
with written notice, at least ninety (90) days prior to the expiration of the
Initial Term or any Subsequent Term, of an intent to terminate this Agreement
upon the expiration of such term.


 


 


[Remainder of page intentionally left blank]


 


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IN WITNESS WHEREOF, each of
the parties hereto has executed and delivered this Agreement, or caused the Agreement
to be duly executed and delivered on its behalf, as of the date first set forth
above.


 


	
   

  	
  REPUBLIC PROPERTIES CORPORATION

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Steven A. Grigg

  
	
   

  	
  Name:
   Steven A. Grigg

  
	
   

  	
  Title:
   President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  REPUBLIC PROPERTY LIMITED PARTNERSHIP

  
	
   

  	
   

  
	
   

  	
  By:  Republic Property Trust,
  its General Partner

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Mark R. Keller

  
	
   

  	
  Name:
   Mark R. Keller

  
	
   

  	
  Title:
   Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/
  Richard L. Kramer

  
	
   

  	
  RICHARD L. KRAMER

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Steven A. Grigg

  
	
   

  	
  STEVEN A. GRIGG

  



 


 


[Signature Page to Services
Agreement]


 





















 


	
   

  	
  REPUBLIC PROPERTY TRUST (solely for

  purposes of Section 1.3)

  
	
   

  	
   

  
	
   

  	
  By:
  

  	
  /s/
  Mark R. Keller

  
	
   

  	
  Name:
  Mark R. Keller

  
	
   

  	
  Title:
  Chief Executive Officer

  



 


 


[Signature Page to Services
Agreement]