Exhibit 10.2


 


AGREEMENT


 


between


 


HPFM (BECKET HOUSE) LIMITED


 


and


 


HUNTER PROPERTY FUND MANAGEMENT LIMITED


 


Re: Asset Management of Becket House, London


 

















 


AGREEMENT


 


between


 


HPFM
(BECKET HOUSE) LIMITED, a company incorporated in Guernsey under The Companies
(Guernsey) Laws 1994 and 1996 and having its registered office in Guernsey at
PO Box 141, La Tonelle House, Les Banques, St Sampson, Guernsey, GY1 3HS (the “Company”)


 


and


 


HUNTER PROPERTY FUND
MANAGEMENT LIMITED, a company incorporated in Scotland under the Companies Acts
(company number SC 199327) and having its registered office at 17 Rutland
Street, Edinburgh EH1 2AE (the “Asset Manager”)


 


WHEREAS


 


(A) The Company is the
proprietor of the leasehold interest in Becket House, 81-90 Cheapside / 36-37
Old Jewry, London, EC2.


 


(B) The Company wishes to
appoint the Asset Manager to provide, and the Asset Manager has agreed to
provide, the Services (as hereinafter defined) to the Company on the terms and
conditions set out in this Agreement.


 


NOW THEREFORE IT IS HEREBY
AGREED as follows:-


 


1              Interpretation


 


1.1           In this Agreement, unless the context
otherwise requires, the following words and expressions shall have the
following meanings ascribed to them:


 


“Accounting Period” shall mean the accounting period of the Company ending on 30 September
and each subsequent date or such other date as the Company may determine and
notify the Asset Manager;


 


“Board” means the board of directors of the Company;


 


“Commencement Date” shall be 3 October 2007 notwithstanding the date of this Agreement;


 


“First Hurdle Rate” an IRR of 20% per annum;


 

















 


“Force Majeure” means any cause affecting the performance of this Agreement arising
from or attributable to acts, events, non-happenings, omissions or accidents
beyond the reasonable control of the Asset Manager and, in particular, but
without limitation, shall include strikes, lock-outs or other industrial
action, civil commotion, riot, invasion, war, threat of or preparations for
war, fire, explosion, storm, flood, earthquake, subsidence, epidemic of other
natural physical disaster, acts and regulations of local government and
parliamentary authority, communication line failures and power failures or
shortages;


 


“Investor” means a shareholder in the Company;


 


“IRR” means,
as to the Company, the actual internal rate of return on the investment in the
Property made by the Company, as calculated by the Company on a compounded
annual basis taking into consideration the timing and amount of the investments
made by the Company in the Property, as well as the timing and amount of all
distributions received by the Company as a result of such investment;


 


“Property” means the leasehold interest and other interests owned by the Company
in Becket House, 81-90 Cheapside/

36-37 Old Jewry, London, EC2;


 


“Return” means the return or distribution to shareholders of the Company of the
gross sum or sums actually received in respect of the Property before tax and
after deducting amounts of debt repaid in respect of the Property and any other
liability of the Company (excluding the Asset Managers Performance Fee (as
defined in clause 6)


 


“Second Hurdle Rate” an IRR of 25% per annum;


 


“Services” means the provision of the strategic
property consultancy services and advice set out in Clause 4 and such additional
services and advice as may be agreed between the Company and the Asset Manager from
time to time; and


 


“Third Hurdle Rate” an IRR of 30% per annum;


 


“Working Day” means a day on which clearing banks are open for business in Scotland.


 


1.2           Unless the context otherwise requires, words
and expressions defined in the Companies Act 1985 and the Companies Act 2006
(as amended) shall have the same meanings herein as therein.


 


1.3           References herein to the parties and to
Clauses and Schedule are respectively to the parties and to the Clauses of, and
the Schedule to, this Agreement.


 

















 


1.4           Except where the context otherwise requires
the singular herein shall include the plural and reference to any gender shall
include all other genders.


 


1.5           The headings to this Agreement are for ease
of reference only and shall not affect the interpretation or construction of
this Agreement.


 


2              Appointment and duration


 


2.1           The Company hereby appoints the Asset Manager
to provide the Services and the Asset Manager agrees to provide the Services to
the Company on the terms and conditions set out in this Agreement.


 


2.2           The Asset Manager shall provide the Services
as from the Commencement Date and the appointment shall continue until the
appointment is terminated pursuant to the provisions of Clause 9.


 


2.3           The Company undertakes to the Asset Manager
that it shall co-operate with the Asset Manager to enable the Asset Manager to
provide the Services in accordance with this Agreement.


 


3              Attention to business


 


3.1           The Asset Manager agrees to procure that its
personnel shall devote as much of their time and attention to the performance
of its responsibilities and duties hereunder as shall reasonably be required
for the proper provision of the Services.


 


3.2           In providing the Services, the Asset Manager
shall procure that its personnel shall exercise that degree of skill and care
as could reasonably be expected of a person skilled in the provision of the
Services, provided that neither the Asset Manager nor its directors, employees
or other personnel shall, in the absence of fraud, negligence, wilful
misconduct or bad faith, be liable for any act or omission in the course of, or
in connection with, the provision of the Services.


 


3.3           The Asset Manager shall perform or cause to
be performed such services and actions customarily performed or taken by asset
managers for properties of similar type, location and character as the
Property, and shall, in addition to and without limiting the foregoing, perform
its responsibilities and functions hereunder to a standard not less than that
which the Asset Manager itself, and in any event a prudent person with
substantial experience in professional real estate asset management of
properties similar to the Property, would conduct the asset management of its
own real estate investments in similar properties.


 


4              The Services


 


4.1           The
Asset Manager shall provide the following services as and when reasonably
required by the Company:-


 

















 


4.1.1        assisting with the preparation of Board
papers, and such other papers as may be necessary for the Board from time to time;


 


4.1.2        preparing applicable property investment
market reports for the Board’s agenda papers;


 


4.1.3        advising on refurbishment and redevelopment
works and re-negotiations of lease terms in order to maximise the performance
of the Company’s investment;


 


4.1.4        negotiating all purchases and sales and
co-ordinating and supervising the due diligence reports of the appropriate advisers,
the preparation of their reports and the preparation of summary reports of
recommendation to the Board;


 


4.1.5        co-ordinating, supervising and reporting to
the Board, in a format and at such intervals as are approved by the Company from
time to time, on the strategic and day to day property management of the
Company’s investment in the Property, and providing the Board with asset
management reports regarding the financial performance of the Property in a format
and at such intervals as requested by the Company;


 


4.1.6        co-ordinating
on behalf of the Company appropriate insurance coverages and all replacements
thereof, which insurance shall contain such policy provisions acceptable to the
Company and shall be placed in companies approved by the Company;


 


4.1.7        assisting the Company in preparing and
analysing a budget in respect of the Property;


 


4.1.8        submitting copies of all material
correspondence, memoranda, or other documents relating to the Company or the
Property, to the extent created or received, within twenty (20) business days
of creation or receipt;


 


4.1.9        providing such assistance as the Company may
reasonably require in connection with the Company’s bank finance arrangements;
and


 


4.1.10      arranging independent valuations of the
Company’s investment.


 


4.2           The Asset Manager may delegate (at the cost
of the Asset Manager) the performance of all or some of the rights and
obligations on its part contained in this Agreement to the extent only as
permitted by the terms of this Agreement with the approval of the Company. For
the avoidance of doubt, the Company shall not be liable in any respect for
payment of the fees or costs of or expenses incurred by such delegates. The
Asset


 

















 


Manager
shall remain liable in respect of the obligations of the Asset Manager under
this Agreement notwithstanding any such delegation.


 


4.3           For the
avoidance of doubt, the cost of valuers, solicitors, property management agents
or other professional advisers appointed by the Company or the Asset Manager to
carry out tasks other than those of the Asset Manager detailed in this
Agreement shall be borne by the Company.


 


5              Management Fees


 


5.1           The management fees payable for each
Accounting Period to the Asset Manager by the Company for the provision of the
Services hereunder shall be a sum equivalent to 0.5 per cent of the valuation
of the Company’s property assets.


 


5.2           The management fees shall be due and payable
quarterly in arrears on 31 March, 30 June, 30 September and 31 December and the
Asset Manager shall invoice the Company quarterly for a sum which represents
the amount due under Clause 5.1.


 


5.3           The management fees shall be payable and paid
within 10 Working Days of receipt of the relevant invoice by the Company by way
of telegraphic transfer, made payable to the Asset Manager and transferred to
such bank and such account as the Asset Manager shall direct and intimate in
writing to the Company from time to time.


 


5.4           In the event of default by the Company in
paying any monies due under this Agreement, the Company shall pay interest on
the outstanding sums (and all interest accruing thereon) from the date of
default until the actual date of payment at the rate of 3 per cent per annum
above the base rate for the time being of the Royal Bank of Scotland, whether
before or after judgment.


 


6              Asset Manager’s Performance Fee


 


6.1           Following the Company’s disposal of the
Property there shall be paid or payable if due to the Asset Manager a
performance fee (the “Asset Manager’s
Performance Fee”).


 


6.2           The Asset Manager’s Performance Fee shall be
calculated on the following basis:-


 


6.1.1                        where the Returns to shareholders of the
Company exceed the First Hurdle Rate, the Asset Manager’s Performance Fee shall
equal 20% of the Returns in excess of the First Hurdle Rate;and


 


6.1.2                        where the Returns to shareholders of the
Company exceed the Second Hurdle Rate, the Asset Manager’s Performance Fee
shall equal 25% of the Returns in excess of the Second Hurdle Rate; and


 

















 


6.1.3                        where the Returns to shareholders of the
Company exceed the Third Hurdle Rate, the Asset Manager’s Performance Fee shall
equal 30% of the Returns in excess of the Third Hurdle Rate.


 


6.3           The Asset Manager’s Performance Fee shall be
payable at the same time as any distribution is made to shareholders by the
Company.


 


6.4           Unpaid balances (if any) of the Asset Manager’s
Performance Fee shall be paid on the earlier of the date on which the Company
is dissolved, or the date of resignation or termination of the Asset Manager’s
appointment.


 


6.5           The Asset Manager shall invoice the Company
for all amounts due (including payments on account) in respect of the Asset
Manager’s Performance Fee as and when such amounts become payable hereunder.


 


7              Value Added Tax


 


All
sums referred to in this Agreement shall be deemed to be referred to exclusive
of value added tax and if the supplies in respect of which such sums are
payable shall be subject to the payment of value added tax the amount payable
in respect of those supplies shall be increased by value added tax thereon at
the appropriate rate.


 


8              Expenses


 


The
Company shall reimburse the Asset Manager (against production of vouchers and
receipts) all travel, accommodation and entertaining expenses properly incurred
by the Asset Manager (or its directors or employees or other personnel) in
fulfilling its/their responsibilities and duties under this Agreement (provided
such expenses shall not exceed the annual budget agreed with the Company, save
with the Company’s prior consent).


 


9              Duration and Termination


 


9.1           This Agreement may be terminated at any time
by mutual written agreement of both parties.


 


9.2           Subject to clause 9.5, the Asset Manager may
only terminate this Agreement on the expiry of six (6) months’ written notice
to the Company (or such shorter period as may be agreed with the Company).


 


9.3           The Company may terminate this Agreement on
the expiry of three months’ written notice to the Asset Manager where the Asset
Manager is in material breach of the terms of this Agreement and (if such
breach is remediable) fails to remedy that breach within 30 days of being
notified of the breach by the Company.


 


9.4           In the event of either (a) a bona fide arm’s
length sale and transfer of the Property to a third party (including a sale in
foreclosure or deed in lieu


 

















 


thereof);
or (b) a bona fide sale and transfer of all the shares in the Company to a
third party, this Agreement shall automatically terminate, without penalty,
effective upon the closing of the transfer. Upon any such termination, the
Company shall pay to the Asset Manager any earned but unpaid fees and other
reimbursable expenses incurred by the  Asset Manager and payable by the
Company hereunder through to such termination date.


 


9.4           The Company shall be entitled to terminate
this Agreement immediately by notice in writing to the Asset Manager if:


 


9.4.1                the
Asset Manager is dissolved, terminated or wound-up (otherwise than for the
purpose of reconstruction or amalgamation without insolvency) or becomes
insolvent or is otherwise unable to discharge its debts, liabilities or obligations;
or


 


9.4.2                the
Asset Manager becomes unable to pay its debts for the purposes of section
123(1) (excluding sub-section (1)(a) thereof) of the Insolvency Act 1986; or


 


9.4.3                the
Asset Manager is declared bankrupt, or commits an act of bankruptcy or calls a
meeting of its creditors or makes any arrangement with or compounds with its
creditors; or


 


9.4.4                any
encumbrancer takes possession of, or an administrator, an administrative
receiver, a receiver, a trustee, a liquidator or other similar official is
appointed over the whole or any material part of the undertaking, property or
assets of the Asset Manager from time to time; or


 


9.4.5                there
is a presentation of a petition or the passing of an effective resolution for
the winding-up of the Asset Manager (otherwise than for the purpose of
reconstruction or amalgamation without insolvency); or


 


9.4.6                the
Asset Manager or any of its directors, employees or other personnel commits any
act of wilful misconduct, bad faith, fraud or negligence in the provision of
the Services; or


 


9.4.7                the
Asset Manager that is a shareholder in the Company as of the Commencement Date
ceases to be a shareholder in the Company.


 


9.4.8                the
Asset Manager or any affiliate of the Asset Manager becomes a “Delinquent
member” as such term is defined in the Articles of Association of the Company.


 


9.5           The
Asset Manager shall be entitled to terminate this Agreement immediately by
notice in writing to the Company if:


 

















 


9.5.1                the
Company is dissolved, terminated or wound-up or becomes insolvent or is
otherwise unable to discharge
its debts, liabilities or obligations; or


 


9.5.2                the
Company becomes unable to pay its debts for the purposes of section 123(1)
(excluding sub-section (l)(a) thereof) of the Insolvency Act 1986; or


 


9.5.3                any
encumbrancer takes possession of, or an administrator, an administrative
receiver, a receiver, a trustee, a liquidator or other similar official is
appointed over the whole or any material part of the undertaking, property or
assets of the Company from time to time; or


 


9.5.4                there
is a presentation of a petition or the passing of an effective resolution for
the winding-up of the Company (otherwise than for the purpose of reconstruction
or amalgamation without insolvency).


 


9.6           The termination of this Agreement shall be
without prejudice to any fees then due and payable to the Asset Manager
hereunder.


 


9.7           Upon termination (for any reason) of this
Agreement, the Asset Manager shall immediately deliver to the Company all
records, documents and similar materials maintained by the Asset Manager with
respect to the Property and its duties hereunder. For a period of sixty (60)
days after such termination, the Asset Manager shall make itself available to
consult with and advise the Company or any other person or persons designated by
the Company regarding the operation and maintenance of the Property and to the
extent directed by the Company, continue to manage the Property to ensure an
orderly transition between asset management teams; provided, however, that in
the event the Asset Manager performs management and/or consulting services for
the benefit of the Company, the Asset Manager shall be entitled to reasonable
reimbursement of any direct costs (including salary and travel expenses)
incurred by the Asset Manager in furtherance of its obligations pursuant to
this Clause and for this period Asset Manager shall receive the fee as
determined in Clause 5.1. Upon and following such termination, the Asset
Manager shall cooperate with the Company or its designee in effecting an
orderly transition of the Asset Manager’s responsibilities hereunder.


 


10            Confidential Information; Inspection of
Records


 


10.1         The Asset Manager shall during its
appointment hereunder use all reasonable endeavours to procure that its
directors, employees and other personnel shall not disclose to any person, firm
or corporation or use to the detriment of the Company any confidential
information which may have come to its or their knowledge concerning the
affairs of the Company, unless required to do so by law or by the regulations
of any relevant stock exchange or other regulatory body. The obligations contained
in this Clause 10 shall not apply to information which is in or


 

















 


comes
into the public domain (otherwise than in breach of this Agreement).


 


10.2          The
Asset Manager will keep at its principal office and will make available to
representatives and agents of the Company, for inspection and copying (at the
Company’s expense), at their request and during normal business hours, copies
of all documents and financial records which are relevant to the Property and
which are received or generated by the Asset Manager in connection with the
performance of its duties under this Agreement. If requested by the Company or
any shareholder of the Company, the Asset Manager shall promptly furnish copies
of such documents (at the Company’s sole expense) directly to the Company or
the requesting shareholder, as applicable.


 


11            Force Majeure


 


If
the Asset Manager is totally or partially prevented or delayed in the performance
of any of its obligations under or pursuant to this Agreement by Force Majeure
and gives written notice within ten (10) business days after the occurrence of
the Force Majeure event specifying the matters constituting Force Majeure
together with such evidence as it reasonably can give thereof and specifying
the period for which it is reasonably estimated that such prevention or delay
will continue, the Asset Manager shall be excused such performance (and have no
liability for such non-performance) as from the date of the happening of the
Force Majeure for so long as such Force Majeure shall continue;


 


12            Notices


 


12.1         Any notice or other document required to be
given or served under this Agreement by either party hereto to the other shall
be in writing and shall be deemed to be validly given or served if served by:-


 


12.1.1              prepaid
first class registered letter post addressed as set out in Clause 12.3 or to
such other address as may, from time to time, be notified in writing to the
other party for this purpose;


 


12.1.2              personal
delivery by hand to such address; or


 


12.1.3              by
facsimile to the number of the recipient set out in Clause 12.3 or such other
number as may, from time to time, be notified in writing to all other parties
for this purpose.


 


12.2         Any notice so served shall be deemed to have been served:


 


12.2.1              in
the case of 12.1.1, at 10.00 am on the third Working Day after it was posted;


 


12.2.2              in
the case of 12.1.2, if delivered on a Working Day between the hours of 9.00 am
and 4.00 pm, at the time of delivery and, if not delivered on a Working Day or
out with the hours of


 

















 


9.00
am and 4.00 pm, at 10.00 am on the next following Working Day; and


 


12.2.3              in
the case of 12.1.3, if sent before 3.00 pm on any Working Day, at the time of
transmission, and in any other case at 10.00 am on the Working Day next
following the date of dispatch.


 


In
proving service, it shall be sufficient to prove that the envelope containing
the notice was properly addressed and posted as a prepaid first class
registered letter, or that delivery took place or that the facsimile message
was addressed to the recipient’s facsimile number and was properly transmitted,
a complete transmission report having been received (as the case may be).


 


12.3         Any notice posted, delivered or sent by
facsimile in accordance with Clause 12.1 shall be addressed as follows:-


 


12.3.1              to
the Company:-


Marked
for the attention of Ian Powell


Saffery
Champness Management International Limited


La
Tonelle House


Les
Banques


St
Sampson


Guernsey


GY1
3HS


Facsimile
no: 01481 722046


 


12.3.2              to
the Asset Manager:- 


Marked
for the attention of Andrew Winskell 


Hunter
Property Fund Management Limited 


17
Rutland Street


Edinburgh


EH1
2AE


Facsimile
no: 0131 228 3345


 


13            Entire agreement


 


13.1         This Agreement contains the entire agreement
between the parties relating to the transactions contemplated by this Agreement
and supersedes all previous proposals, statements, agreements and other
communications whether written, oral or otherwise, in relation to these
transactions, save that neither party shall be released from any liability
which at the date of this Agreement has already accrued to the other party.


 


13.2         Each of the parties acknowledges that in
agreeing to enter into this Agreement it has not relied upon any
representation, warranty, undertaking, commitment or other assurance (except
those set out in this Agreement) made by or on behalf of the other party before
the execution of this Agreement and each of the parties waives all rights and
remedies which, but for this Clause 13, might otherwise be available to it in
respect of


 

















 


any
such representation, warranty, undertaking, commitment or other assurance;
provided that nothing in this Clause 13 shall limit or exclude any liability
for fraud.


 


14            Variation


 


No
variation of this Agreement shall be valid unless it is in writing and signed
by or on behalf of the parties hereto.


 


15            Invalidity


 


If
a provision of this Agreement is held to be illegal, invalid or unenforceable
under any enactment or rule of law in any jurisdiction, such provision shall,
to that extent, be deemed not to form part of this Agreement and the legality,
validity and enforceability of the remainder of this Agreement shall not be
affected and shall continue in full force and effect.


 


16            Waiver


 


No
failure to exercise, and no delay in exercising, any right or remedy in connection
with this Agreement shall operate as a waiver of that right or remedy. No
single or partial exercise of any right or remedy under this Agreement shall
preclude any other or further exercise of that right or remedy or the exercise
of any other right or remedy. A waiver of any breach of this Agreement shall
not be deemed to be a waiver of any subsequent breach. No waiver by any party
of any of the requirements hereof or of any of its rights hereunder shall be
effective unless given in writing and signed by or on behalf of that party and
no forbearance, delay or indulgence by any party in enforcing the provisions of
this Agreement shall prejudice or restrict the rights of that party.


 


17            No partnership


 


Nothing
herein shall be taken to constitute a partnership between the parties nor the
appointment of one of the parties as agent for the other.


 


18            Assignment and sub-contracting


 


18.1         Subject to Clause 18.2, neither party shall
transfer, assign, mortgage, charge, sub- contract or part with the whole or any
part of its rights, duties, liabilities or obligations whatsoever under this
Agreement without the prior written consent of the other party such consent not
to be unreasonably withheld.


 


18.2         The Asset Manager shall be entitled to
sub-contract any of its rights, duties, liabilities and obligations under this
Agreement with the prior written consent of the Company, provided that, unless
the Company otherwise agrees in writing, the Asset Manager shall remain
responsible and liable to the Company for any rights, duties, liabilities or
obligations which are so sub-contracted.


 

















 


18.3         The Asset Manager shall not be responsible or liable to the Company for
contractors and advisers appointed by the Company.


 


19              Governing
Law


 


This
Agreement and the rights of the parties hereto shall be governed by and construed
in accordance with the laws of Scotland and each of the parties hereby submits
to the non-exclusive jurisdiction of the Scottish Courts for all purposes relating
to this Agreement.


 


IN WITNESS WHEREOF this
Agreement consisting of this and the preceding 12 pages is executed in
duplicate by the Parties as follows:


 


For and on behalf of HPFM
(Becket House) Limited at St Sampson, Guernsey on the 23rd  day of November 2007 by one of its directors,
in the presence of:


 


	
   

  	
   

  	
  /s/ William Ferry

  	
   

  
	
  /s/ Paul R Pengelley

  	
  (Witness)

  	
  (Director)

  	
   

  
	
   

  	
   

  	
  /s/ Mark W. LeRay

  	
   

  
	
  Paul R Pengelley

  	
  (Name)

  	
  (Director)

  	
   

  
	
   

  	
   

  	
   

  
	
  THE BROOK, RUE DES MARAIS,

  VALE GUERNSEY GY6 8AU

  	
  (Address)

  	
   

  



 


For and on behalf of Hunter
Property Fund Management Limited at Edinburgh on the 27th day of November
2007 by one of its directors, in the presence of:


 


	
   

  	
   

  	
   

  
	
  /s/ Bronagh Fennell

  	
  (Witness)

  	
   

  
	
   

  	
   

  	
  /s/ Andrew Winskell

  	
   

  
	
  Bronagh Fennell

  	
  (Name)

  	
  (Director)

  	
   

  
	
   

  	
   

  	
   

  
	
  c/o 17 Rutland Street

  	
  (Address)