Document:

Exhibit 10.6

 

June 2, 2008

 

Mr. Kenneth J. Swanson

c/o Pliant Corporation

1475 Woodfield Road

Schaumburg, Illinois 60173

 

Dear Ken:

 

This letter revises and
supersedes as of January 1, 2008, the severance benefit provisions in the
Company’s letter to you of August 17, 2004, in light of the tax
regulations under Section 409A of the Internal Revenue Code.

 

You are eligible for one
year of salary continuance (payable over the 12-month period beginning with
your separation from service) and outplacement support in the event your
employment is involuntarily terminated, except if you are terminated for cause
(as determined exclusively by the Company’s Board of Directors).   In the event that upon your separation you
are a “specified employee” of a “public company” (as those terms are defined in
those regulations) and the total salary continuance exceeds the maximum
involuntary separation pay amount (currently $460,000) permitted by the Section 409A
regulations, the excess will be paid no earlier than the date that is six
months after your separation from service. 
The foregoing is not, however, intended to modify your status of an “at
will” employee of the Company.

 

If you agree that this
correctly restates the terms of your severance benefit, please sign one copy of
this letter below and return the signed copy to me.

 

	
   

  	
   

  	
  Pliant Corporation

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Harold C. Bevis

  
	
   

  	
   

  	
  Harold C. Bevis

  
	
   

  	
   

  	
  President and Chief
  Executive Officer

  

 

Agreed:

 

	
   /s/ Kenneth J. Swanson

  	
   

  
	
  Kenneth J. SwansonExhibit 10.1

 

THIRD
AMENDMENT TO LEASE AGREEMENT

( BUD JONES CHIPS AREA )

 

THIS THIRD AMENDMENT ( THE “THIRD AMENDMENT” ) TO THE LEASE AGREEMENT (“THE
AGREEMENT”) DATED JANUARY 11, 2008 BETWEEN “COPROPIEDAD ARTE Y DISEÑO” (THE “LESSOR”)
REPRESENTED BY MR. FRANCISCO JAVIER MORENO SANCHEZ AND “PAUL-SON MEXICANA S.A.
DE C.V. (THE “LESSEE”) REPRESENTED BY MR. GERARD P. CHARLIER, IS NOW ENTERED BY
AND  BETWEEN THE LESSOR AND LESSEE
PURSUANT TO THE FOLLOWING RECITALS AND CLAUSES:

 

RECITALS

 

The
LESSOR and LESSEE represent:

 

(a)          Effective January 12,
2005, the LESSEE changed its name to GPI MEXICANA S.A. DE C.V.

 

(b)         Effective April 1, 2008
LESSOR agrees to lease to LESSEE, who agrees to lease from LESSOR, an addition
14,000 square feet in the BUILDING as set forth in Paragraph 1.3 of the
AGREEMENT pursuant to the terms of paragraphs 1.4 and 1.5 thereof  concerning RENT and TERM. Blueprints of the
current portions of the BUILDING leased by LESSOR to LESSEE pursuant to this
THIRD AMENDEMENT are attached to this THIRD AMENDMENT as Exhibit “E”.

 

(c)          All other terms and
conditions of the AGREEMENT remain unchanged and in full force and effect.

 

IN
WITNESS WHEREOF, parties and witness execute this THIRD AMENDMENT in the city of  Las Vegas as of April 1, 2008.

 

	
  LESSOR

  	
   

  	
  LESSEE

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Copropiedad Arte y Diseño

  	
   

  	
  GPI Mexicana S.A. de C.V.

  
	
   

  	
   

  	
  Formerly
  Paul-Son Mexicana SA de CV

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Represented
  by:

  	
   

  	
  Represented
  by:

  
	
  Francisco
  Javier Moreno Sanchez

  	
   

  	
  Gerard
  P. Charlier

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  WITNESS

  	
   

  	
  WITNESSExhibit 10.1

 

FIRST AMENDMENT

TO

ADVISORY MANAGEMENT
AGREEMENT

 

This FIRST AMENDMENT TO THE ADVISORY MANAGEMENT
AGREEMENT (the “Amendment”)
is made and entered into as of this 13th day of August, 2008 by and between
BEHRINGER HARVARD OPPORTUNITY REIT II, INC., a Maryland corporation (the “Company”),
and BEHRINGER HARVARD OPPORTUNITY ADVISORS II LP, a Texas limited partnership
(the “Advisor”).

 

WHEREAS, the Company and the Advisor previously
entered into that certain Advisory Management Agreement dated January 4,
2008 (the “Agreement”); and

 

WHEREAS, the Company and the Advisor desire to amend
the Agreement to revise the method of determining how acquisition expenses are
paid effective as of January 1, 2008 and to prohibit the Company from
soliciting the employees of the Advisor during the term of the Agreement and
for the one-year period following the termination thereof.

 

NOW, THEREFORE, in consideration of the premises and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto, intending to be legally bound hereby,
do hereby agree, as follows:

 

1.                                       Defined
Terms. Any term used herein that is not otherwise defined herein shall have
the meaning ascribed to such term as provided in the Agreement.

 

2.                                       Amendment
to Article I.  Article I of
the Agreement is hereby amended by deleting the definition of “Acquisition
Expenses” it in its entirety and replacing it with the following:

 

Acquisition Expenses.  A
non-accountable acquisition expense reimbursement in the amount of: (i) 0.25%
of the funds paid for purchasing an Asset, including any debt attributable to
the Asset, plus 0.25% of the funds budgeted for development, construction or
improvement in the case of Assets that we acquire and intend to develop,
construct or improve or (ii) 0.25% of the funds advanced in respect of a
loan or other investment.   Acquisition
Expenses also include any investment-related expenses due to third parties in
the case of a completed investment, including, but not limited to legal fees
and expenses, travel and communications expenses, costs of appraisals,
accounting fees and expenses, third-party brokerage or finder’s fees, title
insurance, premium expenses and other closing costs.

 

3.                                       Amendment
to Section 3.02(a)(ii) of Article III.  Section 3.02(a)(ii) of Article III
is hereby amended by deleting it in its entirety and replacing it with the
following:

 

(ii)                                  Acquisition Fees and Acquisition Expenses;

 

 

4.                                       Amendment
to Section 3.02 of Article III. 
Section 3.02 of Article III is hereby amended by adding Section
3.02(c) as follows:

 

                                                (c)                                  Notwithstanding anything to the contrary in
this Section 3.02, the Advisor will be responsible for paying all of the
investment-related expenses that the Company or the Advisor incurs that are due
to third parties with respect to investments the Company does not make.

 

5.                                       Amendment
to Article VI.  Article VI
of the Agreement is hereby amended by adding Section 6.15 as follows:

 

6.15                           Non-Solicitation.  During the period commencing on the date on
which this Agreement is entered into and ending one year following the
termination of this Agreement, the Company shall not, without the Advisor’s
prior written consent, directly or indirectly, (i) solicit or encourage
any person to leave the employment or other service of the Advisor or its
affiliates or (ii) hire, on behalf of the Company or any other person or
entity, any person who has left the employment within the one year period
following the termination of that person’s employment the Advisor or its
affiliates.  During the period commencing
on the date hereof through and ending one year following the termination of
this Agreement, the Company shall not, whether for its own account or for the
account of any other person, firm, corporation or other business organization,
intentionally interfere with the relationship of the Advisor or it affiliates
with, or endeavor to entice away from the Advisor or its affiliates, any person
who during the term of the Agreement is, or during the preceding one-year period
was, a customer of the Advisor or its affiliates.

 

6.                                       Continuing
Effect.  Except as otherwise set
forth in this Amendment, the terms of the Agreement shall continue in full
force and effect and shall not be deemed to have otherwise been amended, modified,
revised or altered.

 

7.                                       Counterparts.  The parties agree that this Amendment has
been or may be executed in several counterparts, each of which shall be deemed
an original, and all counterparts shall together constitute one and the same
instrument.

 

[Signature
page follows.]

 

2

 

IN WITNESS WHEREOF, the parties hereto have duly
executed this Amendment as of the date first written above.

 

	
   

  	
  BEHRINGER
  HARVARD OPPORTUNITY

  REIT II, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
       /s/
  Gerald J. Reihsen, III

  
	
   

  	
  Gerald J. Reihsen, III

  
	
   

  	
  Executive Vice President –

  
	
   

  	
  Corporate Development & Legal

  
	
   

  	
   

  
	
   

  	
  BEHRINGER HARVARD OPPORTUNITY

  
	
   

  	
  ADVISORS
  II LP

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Harvard Property
  Trust, LLC,

  
	
   

  	
  its General
  Partner

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
          /s/
  Gerald J. Reihsen, III

  
	
   

  	
   

  	
  Gerald J.
  Reihsen, III

  
	
   

  	
   

  	
  Executive Vice President –

  
	
   

  	
   

  	
  Corporate Development & Legal

  

 

3EXHIBIT 10.2

 

AMENDED AND RESTATED PROPERTY MANAGEMENT AND LEASING
AGREEMENT

 

This
AMENDED AND RESTATED PROPERTY MANAGEMENT AND LEASING AGREEMENT (this “Management
Agreement”) is made and entered into as of the 13th day of August, 2008, by and
among BEHRINGER HARVARD OPPORTUNITY REIT II, INC., a Maryland corporation
(“BH OPPORTUNITY REIT II”), BEHRINGER HARVARD OPPORTUNITY OP II LP, a Texas
limited partnership (“BH OPPORTUNITY II LP”), and BEHRINGER HARVARD OPPORTUNITY
II MANAGEMENT SERVICES, LLC, a Texas limited liability company (the “Manager”).

 

WHEREAS, BH OPPORTUNITY II LP was organized to
acquire, own, operate, lease and manage real estate properties on behalf of BH
OPPORTUNITY REIT II; and

 

WHEREAS,
BH OPPORTUNITY II LP and BH OPPORTUNITY REIT II and Manager previously entered into that
certain Property Management and Leasing Agreement dated January 4, 2008
(the “Original Management Agreement”); and

 

WHEREAS,
BH OPPORTUNITY REIT II intends to continue to raise money from the sale of its
common stock to be used, net of payment of certain offering costs and expenses,
for investment in the acquisition or construction of income-producing real
estate and other real estate-related investments (including the making or
purchase of mortgage, bridge or mezzanine loans), some or all of which are to
be acquired and held by Owner (as hereinafter defined) on behalf of BH
OPPORTUNITY REIT II; and

 

WHEREAS,
Owner desires to continue retaining Manager to manage and coordinate the
leasing of certain of the real estate properties acquired by Owner under the
terms and conditions set forth in this Management Agreement; and

 

WHEREAS, the parties desire to amend and restate the
Original Management Agreement in its entirety in accordance with the terms and
provisions hereof;

 

NOW,
THEREFORE, in consideration of the premises and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto, intending to be legally bound hereby, do hereby agree, as
follows:

 

ARTICLE
I

 

DEFINITIONS

 

Except
as otherwise specified or as the context may otherwise require, the following
terms have the respective meanings set forth below for all purposes of this
Management Agreement, and the definitions of such terms are equally applicable
both to the singular and plural forms thereof:

 

1.1                                 “Advisor”
means Behringer Harvard Opportunity Advisors II LP, a Texas limited
partnership, or its successor as advisor of BH OPPORTUNITY REIT II.

 

1.2                                 “Affiliate”
means, with respect to any Person, (i) any
Person directly or indirectly owning, controlling or holding, with the power to
vote, 10% or more of the outstanding voting securities of such other Person; (ii) any
Person 10% or more of whose outstanding voting securities are directly or
indirectly owned, controlled or held, with the power to vote, by such other
Person; (iii) any Person directly or indirectly controlling, controlled by
or under common control with such other Person; (iv) any

 

1

 

executive officer, director, trustee or general partner of such other
Person; or (v) any legal entity for which such Person acts as an executive
officer, director, trustee or general partner.

 

1.3                                 “Construction
Work” has the meaning set forth in Section 5.2 hereof.

 

1.4                                 “Economic
Interest Percentage” means the percentage of capital contributed directly or
indirectly to the Joint Venture as compared with the total capital contributed
to the Joint Venture by all of the owners of the Joint Venture as the
percentage shall be calculated in good faith by the Owner.  Any in-kind contribution shall be considered
in the calculation of the Economic Interest Percentage and valued at the fair
market value of the contribution on the date of contribution as determined by
the Owner.

 

1.5                                 “Gross Revenues” means all amounts actually
collected as rents or other charges for the use and occupancy of the
Properties, but excluding interest and other investment income of Owner and
proceeds received by Owner from a sale, exchange, condemnation, eminent domain
taking, casualty or other disposition of assets of Owner.

 

1.6                                 “Improvements” means any buildings,
structures and equipment from time to time located on the Properties and all
parking and public common areas located on the Properties.

 

1.7                                 “Intellectual Property Rights” means all
right, title and interest, whether foreign or domestic, in and to any and all
trade secrets, confidential information, patents, inventions, copyrights,
service marks, trademarks, know-how, or similar intellectual property rights
and all applications and rights to apply for these rights, as well as any and
all similar rights and license rights of any type under the laws or regulations
of any governmental, regulatory, or judicial authority, foreign or domestic and
all renewals and extensions thereof.

 

1.8                                 “Joint
Venture” means an investment in a legal organization formed to provide for the
sharing of the risks and rewards in an enterprise co-owned and operated for
mutual benefit by two or more business partners and established to acquire or
hold Properties.

 

1.9                                 “Lease” means, unless the context otherwise
requires, any lease or sublease made by Owner as landlord or by its
predecessor.

 

1.10                           “Management Fee” has the meaning set forth in Section 5.1 hereof.

 

1.11                           “Original Effective Date” means January 4, 2008.

 

1.12                           “Oversight
Fee” has the meaning set forth in Section 5.1 hereof.

 

1.13                           “Owner” means BH OPPORTUNITY REIT II, BH OPPORTUNITY II LP or any joint
venture, limited liability company or other Affiliate of BH OPPORTUNITY REIT II
or BH OPPORTUNITY II LP that owns, in whole or in part, on behalf of BH
OPPORTUNITY REIT II, any Property or Properties.

 

1.14                           “Person” means an individual, corporation, association, business trust,
estate, trust, partnership, limited liability company or other legal entity.

 

1.15                           “Properties” means all interests in real estate owned by Owner and all
tracts to be acquired by Owner containing income-producing improvements or on
which Owner will construct income-producing improvements.

 

1.16                           “Property Amendment” means an amendment to this Management Agreement
describing a Property and the Owner thereof and any variations to the basic
terms and conditions of this Management Agreement with respect to the Property
related thereto.

 

2

 

1.17                           “Proprietary Property” means all modeling algorithms, tools,
computer programs, know-how, methodologies, processes, technologies, ideas,
concepts, skills, routines, subroutines, operating instructions and other
materials and aides used in performing the duties set forth in Article II
that relate to management advice, services and techniques regarding current and
potential Properties, and all modifications, enhancements and derivative works
of the foregoing.

 

1.18                           “Texas
Tax Code” means the Texas Tax Code as amended by Texas H.B. 3, 79th Leg., 3rd
C.S. (2006), and reference to any provision of the Texas Tax Code Act shall
mean such provision as in effect from time to time, as the same may be amended,
and any successor provision thereto, as interpreted by any applicable
administrative rules as in effect from time to time.

 

ARTICLE
II

 

APPOINTMENT
AND STATUS OF MANAGER; SERVICES TO BE PERFORMED

 

2.1                                 Appointment of Manager. 
Owner hereby engages and retains Manager as the manager and as tenant
coordinating agent of the Properties, and Manager hereby accepts such
appointment on the terms and conditions hereinafter set forth; it being
understood that this Management Agreement shall cause Manager to be, at law,
Owner’s agent upon the terms contained herein. 
Owner and Manager shall execute a Property Amendment for each Property
setting forth a description of the Property, the individual legal Owner with
respect to the Property, and any variations from the terms and conditions set
forth in this Management Agreement with respect to the management and leasing
of the Property.

 

2.2                                 Treatment Under Texas Margin Tax.  For
purposes of the Texas margin tax, Manager’s performance of the services
specified in this Management Agreement will cause Manager to conduct part of
the active trade or business of Owner, and Manager’s compensation includes both
the payment of management fees and the reimbursement of specified costs
incurred in Manager’s conduct of the active trade or business of Owner.  Therefore, Owner and Manager intend Manager
to be, and shall treat Manager as, a “management company” within the meaning of
Section 171.0001(11) of the Texas Tax Code.  Owner and Manager will apply Sections
171.1011(m-1) and 171.1013(f)-(g) of the Texas Tax Code to Owner’s
reimbursements paid to Manager pursuant to this Management Agreement of
specified costs and allocable wages and compensation.  Owner and Manager further recognize and
intend that as a result of the relationship created by this Management Agreement,
reimbursements paid to Manager pursuant to this Management Agreement include (i) “flow-though
funds” that Manager is mandated by law or fiduciary duty to distribute, within
the meaning of Section 171.1011(f) of the Texas Tax Code, and (ii) “flow-through
funds” that Manager is mandated by contract to distribute, within the meaning
of Section 171.1011(g).  The terms
of this Management Agreement shall be interpreted in a manner consistent with
the characterization of the Manager as a “management company” as defined in Section 171.0001(11),
and with the characterization of the reimbursements as “flow-though funds”
within the meaning of Section 171.1011(f)-(g) of the Texas Tax Code.

 

2.3                                 General Duties. 
Manager shall devote its reasonable best efforts to performing its
duties hereunder to manage, operate, maintain and lease the Properties in a
diligent, careful and vigilant manner. 
The services of Manager are to be of scope and quality not less than
those generally performed by professional property managers of other similar
properties in that geographic area. 
Manager shall make available to Owner the full benefit of the judgment,
experience and advice of the members of Manager’s organization and staff with
respect to the policies to be pursued by Owner relating to the operation and
leasing of the Properties.

 

2.4                                 Specific Duties.  In
addition to the specific authority granted to Manager by Owner pursuant to Article III
of this Management Agreement.  Manager’s
duties include the following:

 

3

 

(a)                                  Lease
Obligations.  Manager shall perform
all duties of the landlord under all Leases insofar as such duties relate to
operation, maintenance, and day-to-day management.  Manager shall also provide or cause to be provided,
at Owner’s expense, all services normally provided to tenants of like premises,
including where applicable and without limitation, gas, electricity or other
utilities required to be furnished to commercial tenants, repairs and
maintenance necessary to preserve the Properties in its present condition and
for the operating efficiency thereof, and cleaning and janitorial service.  Manager shall arrange for and supervise the
performance of all installations and improvements in space leased to any tenant
that are either expressly required under the terms of the Lease of such space
or that are customarily provided to commercial tenants.

 

(b)                                 Maintenance.  Manager shall cause the Properties to be
maintained in a manner consistent with, or substantially similar to, the manner
in which similar rental properties in that geographic region are
maintained.  Manager’s duties and
supervision in this respect shall include, without limitation, cleaning the
interior and the exterior of the Improvements and making or supervising the
repair, alterations, and decoration of the Improvements, subject to and in
strict compliance with this Management Agreement and the Leases.  Construction activities undertaken by
Manager, if any, shall be limited to activities related to the management,
operation, maintenance, and leasing of the Properties (e.g., repairs,
renovations, and leasehold improvements) including planning and coordinating
the construction of any tenant-paid improvements.

 

(c)                                  Leasing
Functions.  Manager shall coordinate
the leasing of the Properties and shall negotiate and use its reasonable best
efforts to secure executed Leases from what Manager believes are qualified
tenants, and to execute same on behalf of Owner, if requested, for available
space in the Properties, such Leases to be in form and on terms approved by
Owner and Manager.  Manager shall be
responsible for hiring all duly qualified and licensed leasing agents, as
necessary for the leasing of the Properties, and for otherwise overseeing and
managing the leasing process on behalf of Owner.

 

(d)                                 Notice
of Violations.  Manager shall forward
to Owner promptly upon receipt all notices of violation or other notices from
any governmental authority, and board of fire underwriters or any insurance
company, and shall make such recommendations regarding compliance with any
notice as Manager believes is appropriate.

 

(e)                                  Controlling
Agreements.  Manager has received
copies of (and will be provided with copies of future) articles of
incorporation, agreements of limited partnership, joint venture agreements,
operating agreements, loan agreements, deeds of trust or mortgages, each as may
be amended from time to time, of Owner, as applicable (the “Controlling
Agreements”) and is and will be familiar with the terms thereof.  Manager shall use reasonable care to avoid
any act or omission that, in the performance of its duties hereunder, shall in
any way conflict with the terms of Controlling Agreements.

 

(f)                                    Branding.  Manager shall maintain and administer for
Owner the standards of branding established by Behringer Harvard Holdings, LLC
with respect to all billboards, signage and uniforms.

 

(g)                                 Risk
Management.  Manager shall provide to
Owner risk management services, including, but not limited to, the following:
assisting and providing ways to mitigate, minimize, control, and transfer risk
through the prudent use of risk management, insurance programs and
recommendations of safety and loss control techniques; selecting and managing
insurance brokers and service products; preparing underwriting data for use in
marketing insurance programs; negotiating and placing insurance and related
services; serving as liaison for insurance brokers 

 

4

 

and monitoring insurance premium invoices for accuracy; managing and
settling loss control and insurance claims; consulting and coordinating  insurance requirements for financing
Properties; reviewing and monitoring sub-contractor certificates of insurance;
and consulting regarding insurance verbiage requirements for leases and
contracts.

 

(h)                                 Real
Estate Tax Management.  Manager shall
provide to Owner tax management services with respect to the Properties,
including, but not limited to, the following: coordinating payment of real
estate taxes; contesting real estate taxes, as Manager deems appropriate;
accounting for all bills to be processed at any given installment, and
following up on missing bills; data entry of tax amounts and equalized values
when available; providing copies of documents as requested (including following
up on cancelled checks, monitoring payment by third parties, communicating with
interested parties and forwarding tax bills to purchasers and other parties as
necessary).

 

(i)                                     Technology
Use and Support.  Manager shall utilize
the software and technology platforms that it believes are appropriate in
connection with fulfilling its duties under this Management Agreement.  In addition, Manager shall provide technical
support and maintenance with respect to any technology used in the maintenance,
operation, management and leasing of the Properties.

 

2.5                                 The Account. 
Manager shall establish and maintain a separate checking account (the “Account”)
into which all rent and other monies collected from tenants shall be
deposited.  All monies deposited from
time to time in the Account shall be deemed to be trust funds and shall be and
remain the property of Owner and shall be withdrawn and disbursed by Manager
for the account of Owner only as expressly permitted by this Management Agreement.  No monies collected by Manager on Owner’s
behalf shall be commingled with funds of Manager.  The Account shall be maintained, and monies
shall be deposited therein and withdrawn therefrom, in accordance with the
following:

 

(a)                                  All sums received from rents and other income
from the Properties shall be promptly deposited by Manager in the Account.  Manager may endorse any and all checks
received in connection with the operation of any Property and drawn to the order
of Owner, and Owner shall, upon request by Manager, furnish Manager’s
depository with an appropriate authorization for Manager to make such
endorsement.  Manager shall have the
right to designate two or more persons who shall be authorized to draw against
the Account, but only for purposes authorized by this Management Agreement.

 

(b)                                 All sums due to Manager hereunder, whether
for compensation, reimbursement for expenditures, or otherwise, as herein
provided, shall be a charge against the operating revenues of the Properties
and shall be paid or withdrawn by Manager from the Account prior to the making
of any other disbursements therefrom.

 

(c)                                  By the 15th day after the end of each month,
Manager shall forward to Owner all monies contained in the Account other than a
reasonable reserve and any other amounts otherwise provided in the budget for
the relevant property which shall remain in the Account.  Manager shall maintain such other accounts as
shall be deemed appropriate by Owner, including any account in respect of a
particular Property or as is requirement under any loan agreement.

 

2.6                                 Accounting, Records and Reports.

 

(a)                                  Records.  Manager shall maintain all office records and
books of account and shall record therein, and keep copies of, each invoice
received from services, work and supplies ordered in connection with the
maintenance and operation of the Properties. 
Such records shall be maintained on a double entry basis.  Owner and persons designated by Owner shall
at all

 

5

 

reasonable time have access to and the right to audit and make
independent examinations of such records, books and accounts and all vouchers,
files and all other material pertaining to the Properties and this Management
Agreement, all of which Manager agrees to keep safe, available and separate
from any records not pertaining to the Properties, at a place recommended by
Manager and approved by Owner.

 

(b)                                 Monthly
Reports.  On or before the 15th
day after the end of each month during the term of this Management Agreement,
Manager shall prepare and submit to Owner the following reports and statements
with respect to each Property:

 

	
  (i)

  	
  rental
  collection record;

  
	
   

  	
   

  
	
  (ii)

  	
  monthly
  operating statement;

  
	
   

  	
   

  
	
  (iii)

  	
  copies
  of cash disbursements ledger entries for such period, if requested by Owner
  upon 15 days’ written notice;

  
	
   

  	
   

  
	
  (iv)

  	
  copies
  of cash receipts ledger entries for such period, if requested by Owner upon
  15 days’ written notice;

  
	
   

  	
   

  
	
  (v)

  	
  the
  original copies of all contracts entered into by Manager on behalf of Owner
  during such period, if requested by Owner upon 15 days’ written notice; and

  
	
   

  	
   

  
	
  (vi)

  	
  copies
  of ledger entries for such period relating to security deposits maintained by
  Manager, if requested by Owner upon 15 days’ written notice.

  

 

(c)                                  Budgets
and Leasing Plans.  Not later than November 15
of each calendar year, Manager shall prepare and submit to Owner for its
approval an operating budget and a marketing and leasing plan on each Property
for the calendar year immediately following such submission (each, an “Annual
Budget”).  In connection with any
acquisition of a Property by Owner, Manager shall prepare an Annual Budget for
the remainder of the calendar year.  Each
Annual Budget shall incorporate financial models and analysis prepared by
Manager with respect to that property. 
Each Annual Budget shall be in the form of the budget and plan approved
by Owner prior to the date thereof.  As
often as reasonably necessary during the period covered by any such budget,
Manager may submit to Owner for its approval an updated Annual Budget
incorporating any changes as shall be necessary to reflect cost over-runs and
the like during that period.  If Owner
does not disapprove any proposed Annual Budget within 30 days after receipt thereof
by Owner, the Annual Budget shall be deemed approved.  If Owner shall disapprove any proposed Annual
Budget, it shall so notify Manager within said 30-day period and explain the
reasons therefor.  If Owner disapproves
of any proposed Annual Budget, Manager shall submit a revised Annual Budget, as
applicable, within 10 days of receipt of the notice of disapproval, and Owner
shall have 10 days to provide notice to Manager if it disapproves of the
revised Annual Budget.  If a proposed
Annual Budget is not approved by December 31 of any calendar year,  Manager shall operate the applicable Property
pursuant to the proposed Annual Budget for the following calendar year with
respect to those portions approved by Owner and in accordance with the prior
year’s Annual Budget with respect to those portions not approved by Owner (with
the exception of (i) non-recurring expenditures and capital expenditures
which shall be deemed removed from the prior year’s Annual Budget and (ii) actual
increases for real estate taxes, which shall be deemed added to the prior year’s
Annual Budget).

 

6

 

(d)                                 Additional
Costs.  Manager will not incur any
costs other than those included in, and only to the extent provided for
(subject to reasonable deviation for changes in market costs), in any Annual
Budget except for:

 

	
  (i)

  	
  tenant
  improvements and real estate commissions required under a Lease;

  
	
   

  	
   

  
	
  (ii)

  	
  maintenance
  or repair costs under $5,000 per Property;

  
	
   

  	
   

  
	
  (iii)

  	
  costs
  incurred in emergency situations in which action is immediately necessary for
  the preservation or safety of a Property, or for the safety of occupants or
  other persons (or to avoid the suspension of any necessary service at a
  Property);

  
	
   

  	
   

  
	
  (iv)

  	
  expenditures
  for real estate taxes and assessment; and

  
	
   

  	
   

  
	
  (v)

  	
  maintenance
  supplies calling for an aggregate purchase price less than $25,000 per annum
  for all Properties.

  

 

Annual Budgets prepared by Manager shall be for planning and
informational purposes only, and Manager shall have no liability to Owner for
any failure to meet any Annual Budget. 
However, Manager will use its best efforts to operate within the
approved Annual Budget.

 

(e)                                  Legal
Requirements.  Manager shall execute
and file when due all forms, reports, and returns required by law relating to
the employment of its personnel.  Manager
shall be responsible for notifying Owner in the event Manager receives notice
that any Improvement on a Property or any equipment therein does not comply
with the requirements of any statute, ordinance, law or regulation of any
governmental body or of any public authority or official thereof having or
claiming to have jurisdiction thereover. 
Manager shall promptly forward to Owner any complaints, warnings,
notices or summonses received by it relating to such matters.  Owner represents that to the best of its
knowledge each of its Properties and any equipment thereon will upon
acquisition by Owner comply with all such requirements.  Owner authorizes Manager to disclose the
ownership of each Property by Owner to any such officials.

 

2.7                                 Dealings
with Advisor.  Unless Owner
specifically informs Manager to the contrary, Advisor may perform any of the
obligations or exercise any of the rights of Owner under this Management
Agreement.

 

ARTICLE
III

 

AUTHORITY
GRANTED TO MANAGER AND CERTAIN OWNER OBLIGATIONS

 

3.1                                 Authority As To Tenants, Etc.  Owner
agrees and does hereby give Manager the following exclusive authority and
powers (all of which shall be exercised either in the name of Manager, as
manager for Owner, or in the name or Owner entered into by Manager as Owner’s
authorized agent, and Owner shall assume all expenses in connection with such
matters):

 

(a)                                  to
advertise each Property or any part thereof and to display signs thereon, as
permitted by law and subject to the terms and conditions of the leases;

 

(b)                                 to
pay all expenses of leasing each Property, including but not limited to,
newspaper and other advertising, signage, banners, brochures, referral
commissions, leasing commissions, finder’s fees and salaries, bonuses and other
compensation of duly qualified and licensed leasing personnel responsible for
the leasing of each Property;

 

7

 

(c)                                  to
cause references of prospective tenants to be investigated, it being understood
and agreed by the parties hereto that Manager does not guarantee the
creditworthiness or collectibility of accounts receivable from tenants, users
or lessees; and to negotiate new Leases and renewals and cancellations of
existing Leases that shall be subject to Manager obtaining Owner’s approval;

 

(d)                                 to
collect from tenants all or any of the following: a late rent administrative
charge, a non-negotiable check charge, credit report fee, a subleasing
administrative charge or broker’s commission;

 

(e)                                  to
terminate tenancies and to sign and serve in the name of Owner of each Property
such notices as are deemed necessary by Manager;

 

(f)                                    to
institute and prosecute actions to evict tenants and to recover possession of
each Property or portions thereof; and

 

(g)                                 with
Owner’s authorization, to sue for and in the name of Owner and recover rent and
other sums due; and to settle, compromise, and release such actions or suits,
or reinstate such tenancies.  All
expenses of litigation including, but not limited to, attorneys’ fees, filing
fees, and court costs that Manager shall incur in connection with the
collecting of rent and other sums, or to recover possession of any Property or
any portion thereof, shall be deemed to be an operational expense of the
Property.  Manager and Owner shall concur
on the selection of the attorneys to handle such litigation.

 

3.2                                 Operational
Authority.  Owner agrees and does
hereby give Manager the following exclusive authority and powers (all of which
shall be exercised either in the name of Manager, as manager for Owner, or in
the name of Owner entered into by Manager as Owner’s authorized agent, and,
unless otherwise provided herein, Owner shall assume all expenses in connection
with such matters):

 

(a)                                  to
hire, supervise, discharge, and pay all labor required for the operation and
maintenance and leasing of each Property including but not limited to on-site
personnel, managers, assistant managers, leasing consultants, engineers,
janitors, maintenance supervisors and other employees required for the
operation and maintenance of each Property, including personnel spending a
portion of their working hours (to be charged on a pro rata basis) at each
Property.  Any personnel hired by Manager to maintain, operate and lease the
Properties shall be the employees or independent contractors of Manager and not
of Owner.  Manager shall use due care in
selecting and supervising these employees or independent contractors.  With respect to these employees, Manager
shall be responsible for maintaining timekeeping records, processing regular
payroll, filing payroll tax reports on a timely basis, ensuring compliance with
wage and tax laws and tracking benefit hours and garnishments and child support
orders.  All expenses of these employees’
employment shall be deemed operational expenses of the Property.

 

(b)                                 to
make or cause to be made all ordinary repairs and replacements necessary to
preserve each Property in its present condition and for the operating
efficiency thereof and all alterations required to comply with lease
requirements;

 

(c)                                  to
prepare, negotiate, enter into and administer any Leases;

 

(d)                                 to
prepare, negotiate and enter into, as Manager of each Property, (i) contracts
for all items on budgets that have been approved by Owner, (ii) any
repairs for items not exceeding $5,000, (iii) any emergency services, (iv) appropriate
service agreements and labor agreements for normal operation of each Property
with duly qualified and licensed Persons, which have terms not to exceed three
years, (v) agreements for all budgeted maintenance, minor alterations, and

 

8

 

utility services, including, but not limited to, electricity, gas,
fuel, water, telephone, window washing, scavenger service, landscaping, snow
removal, pest exterminating, decorating and legal services, in connection with
the Leases and relating to each Property and (vi) any other service
agreements as Manager may consider appropriate (collectively, the “Contracts”);
and

 

(e)                                  to
purchase supplies and pay all bills in accordance with the Annual Budget or as
permitted under Sections 2.6(d)(ii) or 2.6(d)(v).

 

Manager shall use its reasonable commercial best efforts to obtain the
foregoing services and utilities for each Property on terms consistent with, or
substantially similar to, those available to similar rental properties in the
geographic region in which the Property is located.  Owner hereby appoints Manager as Owner’s
authorized Manager for the purpose of executing, as Manager for said Owner, all
Contracts.  Manager shall secure the
approval of, and execution of appropriate Contracts by, Owner for any
non-budgeted and non-emergency/contingency capital items, alterations or other
expenditures in excess of $5,000 for any one item, securing for each item at
least three written bids, if practicable, or providing evidence satisfactory to
Owner that the Contract amount is lower than industry standard pricing in the
geographic region in which the Property is located, from responsible
contractors.  Manager shall have the
right from time to time during the term hereof, to contract with and make
purchases from duly qualified and licensed Affiliates of Manager, provided that
contract rates and prices are no less favorable to Owner than those available
from unaffiliated third parties.  Manager
may at any time and from time to time request and receive the prior written
authorization of Owner of the Property of any one or more purchases or other
expenditures, notwithstanding that Manager may otherwise be authorized
hereunder to make such purchases or expenditures.

 

3.3                                 Rent
and Other Collections.  Owner agrees
and does hereby give Manager the exclusive authority and powers (all of which
shall be exercised either in the name of Manager, as manager for Owner, or in
the name or Owner entered into by Manager as Owner’s authorized agent, and
Owner shall assume all expenses in connection with such matters) to collect
rents, assessments and other items, including but not limited to tenant
payments for real estate taxes, property liability and other insurance, damages
and repairs, common area maintenance, tax reduction fees and all other tenant
reimbursements, administrative charges, proceeds of rental interruption
insurance, parking fees, income from coin operated machines and other miscellaneous
income, due or to become due and give receipts therefor and to deposit all such
Gross Revenue collected hereunder in the Account.  Manager shall also have the exclusive
authority to collect and handle tenants’ security deposits, including the right
to apply such security deposits to unpaid rent, and to comply, on behalf of
Owner of each Property, with applicable state or local laws concerning security
deposits and interest thereon, if any.

 

3.4                                 Advances.  Manager shall not be required to advance any
monies for the care or management of any Property, but Owner agrees to advance
all monies necessary therefor, provided that any advanced amounts have been
budgeted in the Annual Budget.  If
Manager shall elect to advance any money in connection with a Property, Owner
agrees to reimburse Manager within 30 days and hereby authorizes Manager to
deduct such advances from any monies due Owner. 
In connection with any insured losses or damages relating to any
Property, Manager shall have the exclusive authority to handle all steps
necessary regarding any such claim; provided that Manager will not make any
adjustments or settlements in excess of $10,000 without Owner’s prior written
consent.

 

3.5                                 Payment
of Expenses.  Owner agrees and does
hereby give Manager the exclusive authority and power (all of which shall be
exercised either in the name of Manager, as manager for Owner, or in the name
or Owner entered into by Manager as Owner’s authorized agent, and Owner shall
assume all expenses in connection with such matters) to pay all expenses of
each Property, including utility and water charges, secure rent and
assessments, from the Gross Revenue collected in accordance with Section 3.3
above, from the Account.  All bills shall
be paid by Manager within the time required to obtain discounts, if any. Owner
may from time to time request that Manager forward certain bills to

 

9

 

Owner promptly
after receipt, and Manager shall comply with any such request.  All expenses shall be billed at net cost
(i.e., less all rebates, commissions, discounts and allowances, however
designed).

 

It is understood that the Gross Revenue will be used first to pay the
compensation to Manager as contained in Article V below, then operational expenses
and then any mortgage indebtedness, including real estate tax and insurance
impounds, but only as directed by Owner in writing and only if sufficient Gross
Revenue is available for such payments. 
Nothing in this Management Agreement shall be interpreted in such a
manner as to obligate Manager to pay from Gross Revenue, any expenses incurred
by Owner prior to the commencement of this Management Agreement, except to the
extent Owner advances additional funds to pay such expenses.

 

3.6                                 Environmental Matters. 
Owner hereby warrants and represents to Manager that to the best of
Owner’s knowledge, no Property, upon acquisition by Owner, nor any part
thereof, will be used to treat, deposit, store, dispose of or place any
hazardous substance that may subject Manager to liability or claims under the
Comprehensive Environmental Response, Compensation and Liability Act of 1980
(42 U.S.C.A. Section 9607) or any constitutional provision, statute,
ordinance, law, or regulation of any governmental body or of any order or
ruling of any public authority or official thereof, having or claiming to have
jurisdiction thereover.

 

3.7                                 Legal Status of Properties. 
Owner represents that to the best of its knowledge each Property and any
equipment thereon, when acquired by Owner, will comply with all legal
requirements and authorizes Manager to disclose the identity of the owner of
each Property to any such officials.  In
the event it is alleged or charged that any Improvement or any equipment on a
Property or any act or failure to act by Owner with respect to the Property or
the sale, rental, or other disposition thereof fails to comply with, or is in
violation of, any of the requirements of any constitutional provision, statute,
ordinance, law, or regulation of any governmental body or any order or ruling
of any public authority or official thereof having or claiming to have
jurisdiction thereover, and Manager, in its sole and absolute discretion,
considers that the action or position of Owner, with respect thereto may result
in damage or liability to Manager, Manager shall have the right to cancel this
Management Agreement at any time by written notice to Owner of its election so
to do, which cancellation shall be effective upon the service of such notice.  Such cancellation shall not release the
indemnities of Owner set forth in this Management Agreement and shall not
terminate any liability or obligation of Owner to Manager for any payment,
reimbursement, or other sum of money then due and payable to Manager hereunder.

 

3.8                                 Extraordinary Payments. 
Owner agrees to give adequate advance written notice to Manager if Owner
desires that Manager make any extraordinary payment, out of Gross Revenue, to
the extent funds are available after the payment of Manager’s compensation as
provided for herein and all operational expenses, of mortgage indebtedness,
general taxes, special assessments, or insurance premiums.

 

ARTICLE
IV

 

EXPENSES

 

4.1                                 Owner’s Expenses.  Except
as otherwise specifically provided, all costs and expenses incurred hereunder
by Manager in fulfilling its duties to Owner shall be for the account of and on
behalf of Owner.  Such costs and expenses
shall include the wages and salaries and other employee-related expenses of all
on-site and off-site employees of Manager who are engaged in the operation,
management, maintenance and leasing or access control of the Properties,
including taxes, insurance and benefits relating to such employees, costs of
technology related to the Properties, including computers, telephone systems and
property management and accounting software and any upgrades or conversions
thereof, and legal, travel and other out-of-pocket expenses that are directly
related to the management of specific Properties.  All costs and expenses for which Owner is
responsible under this Management 

 

10

 

Agreement shall be
paid by Manager out of the Account.  In
the event the Account does not contain sufficient funds to pay all said
expenses, Owner shall fund all sums necessary to meet such additional costs and
expenses.

 

4.2                                 Manager’s Expenses. 
Manager shall, out of its own funds, pay all of its general overhead and
administrative expenses.

 

ARTICLE V

 

MANAGER’S COMPENSATION

 

5.1                                 Management Fees. 
Owner shall pay Manager property management fees in an amount equal to
four and one-half percent (4.5%) of Gross Revenues (the “Management Fee”)
on a monthly basis from the income received from the Properties over the term
of this Management Agreement.  Certain of
these Properties may be owned by Joint Ventures.  When the Manager is not paid by the Joint
Venture directly in respect of its services, the applicable Management Fee or
Oversight Fee (as defined below) to be paid by the Owner will be calculated by
multiplying the Management Fee by the Economic Interest Percentage owned
directly or indirectly by the Owner in that Property.  In the event that Owner contracts directly
with a third-party property manager not affiliated with the Manager in respect
of a Property for which the Owner, in its sole discretion, has the ability to
appoint or hire the Manager, Owner shall pay Manager an oversight fee (“Oversight
Fee”) equal to one-half of one percent (0.5%) of Gross Revenues.  In no event will Owner pay both a Management
Fee and an Oversight Fee to Manager with respect to any Property.  If Manager subcontracts its responsibilities
hereunder to another person or entity, Manager shall be solely responsible for
the payment to the third party.  The
Management Fee includes the reimbursement of the specified cost incurred by the
Manager of engaging another person or entity to perform Manager’s
responsibilities hereunder; provided, however, that Manager shall be
responsible for payment of all amounts to these third parties.  Nothing herein shall prevent Manager from
entering fee-splitting arrangements with third parties with respect to the
Management Fee.

 

5.2                                 Construction
Supervision Fees.  Manager shall
supervise construction performed by or on behalf of Owner with respect to the
Properties, including, but not limited to, capital repairs and improvements,
major building reconstruction and tenant improvements (collectively, “Construction
Work”).  In the event that Manager
supervises the Construction Work with respect to a Property, Owner shall pay
Manager a construction supervision fee equal to an amount not greater than five
percent (5%) of all hard construction costs incurred in connection with the
Construction Work.  Owner shall pay
construction supervision fees at the same time it makes payments to any third
party contractors in respect of any Construction Work at that Property.

 

5.3                                 Leasing Fees.  In
addition to the compensation paid to Manager under Section 5.1 above,
Manager shall be entitled to receive a separate fee for the Leases of new tenants
and renewals of Leases with existing tenants in an amount not to exceed the fee
customarily charged in arm’s length transactions by others rendering similar
services in the same geographic area for similar properties as determined by a
survey of brokers and agents in such area.

 

5.4                                 Audit Adjustment.  If
any audit of the records, books or accounts relating to the Properties
discloses an overpayment or underpayment of Management Fees, Owner or Manager
shall promptly pay to the other party the amount of such overpayment or
underpayment, as the case may be.  If
such audit discloses an overpayment of Management Fees for any fiscal year of
more than the correct Management Fees for such fiscal year, Manager shall bear
the cost of such audit.

 

11

 

ARTICLE
VI

 

INSURANCE
AND INDEMNIFICATION

 

6.1                                 Insurance to be Carried.

 

(a)                                  Manager
shall obtain and keep in full force and effect insurance on the Properties
against such hazards as Owner and Manager shall deem appropriate, but in any
event insurance sufficient to comply with the Leases and Controlling Agreements
shall be maintained. All liability policies shall provide sufficient insurance
satisfactory to both Owner and Manager and shall contain waivers of subrogation
for the benefit of Manager.

 

(b)                                 Manager
shall obtain and keep in full force and effect, in accordance with the laws of
the state in which each Property is located, workers’ compensation and employer’s
liability insurance applicable to and covering all employees of Manager at the
Properties, and Manager shall furnish Owner certificates of insurers evidencing
that such insurance is in effect.  If any
work under this Management Agreement is subcontracted as permitted herein,
Manager shall include in each subcontract a provision that the subcontractor
shall also furnish Owner with  such a
certificate.

 

6.2                                 Insurance Expenses. 
Premiums and other expenses of such insurance, as well as any applicable
payments in respect of deductibles shall be borne by Owner.

 

6.3                                 Cooperation with Insurers. 
Manager shall cooperate with and provide reasonable access to the
Properties to representatives of insurance companies and insurance brokers or
agents with respect to insurance that is in effect or for which application has
been made.  Manager shall use its best
efforts to comply with all requirements of insurers.

 

6.4                                 Accidents and Claims. 
Manager shall promptly investigate and shall report in detail to Owner
all accidents, claims for damage relating to ownership, operation or
maintenance of the Properties, and any damage or destruction to the Properties
and the estimated costs of repair thereof, and shall prepare for approval by
Owner all reports required by an insurance company in connection with any such
accident, claim, damage, or destruction. 
Such reports shall be given to Owner promptly, and any report not so
given within 10 days after the occurrence of any such accident, claim, damage
or destruction shall be noted in the monthly operating statement delivered to
Owner pursuant to Section 2.6(b)(ii). 
Manager is authorized to settle any claim against an insurance company
arising out of any policy and, in connection with such claim, to execute proofs
of loss and adjustments of loss and to collect and receipt for loss proceeds.

 

6.5                                 Indemnification.

 

(a)                                  Indemnification
of Manager. Owner agrees to indemnify, defend, protect, save and hold
harmless Manager and its stockholders, officers, directors, employees,
managers, successors and assigns (collectively, the “Indemnified Parties”) from
any and all claims, causes of action, demands, suits, proceedings, loss,
judgments, damage, awards, liens, fines, costs, attorney’s fees and expenses,
of every kind and nature whatsoever (collectively, “Losses”) in connection with
or in any way related to (i) any Contract, (ii) each Property,
including any past, current or future allegations regarding treatment,
depositing, storage, disposal or placement by any party other than Manager of
hazardous substances on the Property, and from liability for damage to each
Property and injuries to or death of any person whomsoever, and damage to
Property and (iii) the misconduct, negligence or unlawful acts (such
unlawfulness having been adjudicated by a court of proper jurisdiction) of
Owner, or the failure of Owner to correct any present or future violation or
alleged violation of any and all present or future laws, ordinances,

 

12

 

statutes, or regulations of any public authority or official thereof,
having or claiming to have jurisdiction thereover, of which it has actual
notice; provided, however, that the indemnification and exculpation shall not
extend to any such Losses arising out of the misconduct, negligence or unlawful
acts (the unlawfulness having been adjudicated by a court of proper
jurisdiction) of Manager, its agents, servants, or employees; provided,
further, that the indemnification and exculpation shall be limited to the
extent that Manager recovers insurance proceeds with respect to that matter.
Manager shall not be liable for any error of judgment or for any mistake of
fact or law, or for any thing that it may do or refrain from doing, except in
cases of misconduct, negligence or unlawful acts (the unlawfulness having been
adjudicated by a court of proper jurisdiction).

 

(b)                                 Indemnification
of Owner.  Manager agrees to
indemnify, defend, protect, save and hold harmless Owner and its stockholders,
officers, directors, employees, managers, successors and assigns from any and
all claims or liability for any injury or damage to any person or property
whatsoever for which Manager is responsible occurring in, on, or about the
Properties, including, without limitation, the Improvements, when the injury or
damage shall be caused by the misconduct, negligence or unlawful acts (the unlawfulness
having been adjudicated by a court of proper jurisdiction) of Manager, its
agents, servants, or employees, except to the extent that Owner recovers
insurance proceeds with respect to such matter.

 

(c)                                  Limitations.
Notwithstanding anything to the contrary in this Management Agreement, any
indemnification and exculpation by the Owner under this Management Agreement is
subject to any limitations imposed under the Company’s Articles of
Incorporation or any amendments thereto.

 

ARTICLE
VII

 

TERM
AND TERMINATION

 

7.1                                 Term.  This Management Agreement
shall commence on the Original Effective Date and shall continue until the
fifth anniversary of such date and thereafter for successive five year renewal
periods, unless on or before one year prior to the date last above mentioned or
on or before one year prior to the expiration of any such renewal period,
Manager shall notify Owner in writing that it elects to terminate this
Management Agreement, in which case this Management Agreement shall be thereby
terminated on said last mentioned date. 
In addition, and notwithstanding the foregoing, Owner may terminate this
Management Agreement at any time upon delivery of written notice to Manager not
less than 30 days prior to the effective date of termination, in the event of
(and only in the event of) a showing by Owner of misconduct, negligence, or
deliberate malfeasance by Manager in the performance of Manager’s duties
hereunder.  In addition, either party may
terminate this Management Agreement immediately upon the occurrence of any of
the following:

 

(a)                                  A
decree or order is rendered by a court having jurisdiction (i) adjudging
Manager as bankrupt or insolvent, or (ii) approving as properly filed a
petition seeking reorganization, readjustment, arrangement, composition or
similar relief for Manager under the federal bankruptcy laws or any similar
applicable law or practice, or (iii) appointing a receiver or liquidator
or trustee or assignee in bankruptcy or insolvency of Manager or a substantial
part of the property of Manager, or for the winding up or liquidation of its
affairs; or

 

(b)                                 Manager
(i) institutes proceedings to be adjudicated a voluntary bankrupt or an
insolvent, (ii) consents to the filing of a bankruptcy proceeding against
it, (iii) files a petition or answer or consent seeking reorganization,
readjustment, arrangement, composition or relief under

 

13

 

any similar applicable law or practice, (iv) consents to the
filing of any such petition, or to the appointment of a receiver or liquidator
or trustee or assignee in bankruptcy or insolvency for it or for a substantial
part of its property, (v) makes an assignment for the benefit of
creditors, (vi) is unable to or admits in writing its inability to pay its
debts generally as they become due unless such inability shall be the fault of
the other party, or (iv) takes corporate or other action in furtherance of
any of the aforesaid purposes.

 

7.2                                 Manager’s Obligations Upon Termination.  Upon
the termination of this Management Agreement, Manager shall cooperate with
Owner and take all reasonable steps requested by Owner to make an orderly
transition of the Manager’s services, including without limitation:

 

(a)                                  Manager
shall deliver to Owner or its designee, all books and records with respect to
the Properties.

 

(b)                                 Manager
shall transfer and assign to Owner, or its designee, all service contracts and
personal property relating to or used in the operation and maintenance of the
Properties, except personal property paid for and owned by Manager.  Manager shall also, for a period of
60 days immediately following the date of such termination, make itself
available to consult with and advise Owner, or its designee, regarding the
operation, maintenance and leasing of the Properties.

 

(c)                                  Manager
shall render to Owner an accounting of all funds of Owner in its possession and
shall deliver to Owner a statement of all Management Fees claimed to be due to
Manager and shall cause funds of Owner held by Manager relating to the
Properties to be paid to Owner or its designee.

 

(d)                                 All provisions of this Management Agreement
that require Manager to have insured, or to protect, defend, save, hold and
indemnify or to reimburse Owner shall survive any expiration or termination of
this Management Agreement and, if Owner is or becomes involved in any claim,
proceeding or litigation by reason of having been Owner, such provisions shall
apply as if this Management Agreement were still in effect.

 

7.3                                 Owner’s Obligations Upon Termination.  Upon
the termination of this Management Agreement, Owner shall cooperate with
Manager and take all reasonable steps to make an orderly transition of the
Manager’s services to Owner, including without limitation:

 

(a)                                  Owner shall pay or reimburse Manager for any
sums of money due it under this Management Agreement for services and expenses
prior to termination of this Management Agreement.  The parties understand and agree that Manager
may withhold funds for 60 days after the end of the month in which this Management
Agreement is terminated to pay bills previously incurred but not yet invoiced
and to close accounts. Should the funds withheld be insufficient to meet the
obligation of Manager to pay bills previously incurred, Owner will, upon
demand, advance sufficient funds to Manager to ensure fulfillment of Manager’s
obligation to do so, within 10 days of receipt of notice and an itemization of
such unpaid bills.

 

(b)                                 Owner shall assume in writing all obligations
under all Contracts entered into by Manager, on behalf of Owner of the
Property, upon the termination of this Management Agreement.

 

(c)                                  All provisions of this Management Agreement
that require Owner to have insured, or to protect, defend, save, hold and
indemnify or to reimburse Manager shall survive any expiration or termination
of this Management Agreement and, if Manager is or becomes

 

14

 

involved in any claim, proceeding or
litigation by reason of having been Manager of Owner, such provisions shall
apply as if this Management Agreement were still in effect.

 

ARTICLE VIII

 

MISCELLANEOUS

 

8.1                                 Notices.  All notices, approvals,
consents and other communications hereunder shall be in writing, and, except
when receipt is required to start the running of a period of time, shall be
deemed given when delivered in person or on the fifth day after its mailing by
either party by registered or certified United States mail, postage prepaid and
return receipt requested, to the other party, at the addresses set forth after
their respect name below or at such different addresses as either party shall
have theretofore advised the other party in writing in accordance with this Section 8.1.

 

	
  Owner:

  	
  BEHRINGER HARVARD OPPORTUNITY
  OP II LP

  
	
   

  	
  c/o Behringer Harvard
  Opportunity REIT II, Inc.

  
	
   

  	
  15601 Dallas Parkway

  
	
   

  	
  Suite 600

  
	
   

  	
  Addison, Texas 75001

  
	
   

  	
  Attention: Chief Legal
  Officer

  
	
   

  	
   

  
	
  Manager:

  	
  BEHRINGER HARVARD OPPORTUNITY
  II MANAGEMENT SERVICES, LLC

  
	
   

  	
  15601 Dallas Parkway

  
	
   

  	
  Suite 600

  
	
   

  	
  Addison, Texas 75001

  
	
   

  	
  Attention: Chief Legal
  Officer

  

 

8.2                                 Governing Law; Venue.  This
Management Agreement shall be governed by and construed in accordance with the
internal laws of the State of Texas, and any action brought to enforce the
agreements made hereunder or any action which arises out of the relationship
created hereunder shall be brought exclusively in Dallas County, Texas.

 

8.3                                 Assignment.  Manager may assign or delegate
partially or in full its duties and rights under this Management Agreement and
the fees and compensation related thereto to a duly qualified and licensed
Affiliate of Manager without the approval of Owner.  Any other assignment or delegation by Manager
of its duties and rights under this Management Agreement may be made only with
the prior written consent of Owner.  Owner
acknowledges and agrees that any or all of the duties of Manager as contained
herein may be assigned or delegated by Manager and performed by a duly
qualified and licensed Person (“Submanager”) with whom Manager contracts for
the purpose of performing such duties. 
Owner specifically grants Manager the authority to enter into such a
contract with a Submanager; provided that, unless Owner otherwise agrees in
writing with such Submanager, Owner shall have no liability or responsibility
to any such Submanager for the payment of the Submanager’s fee or for
reimbursement to the Submanager of its expenses or to indemnify the Submanager
in any manner for any matter; and provided further that Manager shall require
such Submanager to agree, in the written agreement setting forth the duties and
obligations of such Submanager, to indemnify Owner for all Losses incurred by
Owner as a result of the misconduct or negligence of the Submanager, except
that such indemnity shall not be required to the extent that Owner recovers
issuance proceeds with respect to such matter. 
Any contract entered into between Manager and a Submanager pursuant to
this Section 8.3 shall be consistent with the provisions of this
Management Agreement, except to the extent Owner otherwise specifically agrees
in writing.  This Management Agreement
shall be binding upon and shall inure to the benefit of the parties hereto and
their respective successors and permitted assigns.

 

15

 

8.4                                 Third Party Leasing Services. 
Manager acknowledges that from time to time Owner may determine that it
is in the best interests of Owner to retain a third party to provide certain
leasing services with respect to certain Properties and to compensate such
third party for such leasing services. 
Upon the prior written consent of Manager, Owner shall have the
authority to enter into such a contract for leasing services with a duly
qualified and licensed third party (a “Third Party Leasing Agreement”);
provided that Manager shall have no liability or responsibility to Owner for
any of the duties and obligations undertaken by such party, and Owner agrees to
indemnify Manager for all Losses incurred by Manager as a result of acts of
such third party pursuant to the Third Party Leasing Agreement.  To the extent that leasing services are
specifically required to be performed by a third party pursuant to such Third
Party Leasing Agreement, Manager shall have no obligation to perform such leasing
services and Owner shall have no obligation to Manager for leasing fees
pursuant to Section 5.3 hereof.

 

8.5                                 Third Party Management Services. 
Manager acknowledges that from time to time Owner may acquire interests
in Properties in which Owner does not control the determination of the party that
is engaged to provide property management and other services to be provided by
Manager with respect to all Properties acquired by Owner hereunder.  Upon the prior written consent of Manager,
Owner shall have the authority to acquire such interests in Properties for
which a duly qualified and licensed third party provides some or all of the
services otherwise required to be performed by Manager hereunder (a “Third
Party Management Agreement”); provided that Manager shall have no liability or
responsibility to Owner for any of the duties and obligations undertaken by
such third party, and Owner agrees to indemnify Manager for all Losses incurred
by Manager as a result of the acts of such third party pursuant to the Third
Party Management Agreement.  To the
extent that property management and other services are specifically required to
be performed by a third party pursuant to such Third Party Management
Agreement, Manager shall have no obligation to perform such services and Owner
shall have no obligation to Manager for compensation for such services pursuant
to Article V hereof.

 

8.6                                 No Waiver.  The failure of Owner to seek
redress for violation or to insist upon the strict performance of any covenant
or condition of this Management Agreement shall not constitute a waiver thereof
for the future.

 

8.7                                 Amendments.  This Management Agreement may
be amended only by an instrument in writing signed by the party against whom
enforcement of the amendment is sought.

 

8.8                                 Headings.  The headings of the various
subdivisions of this Management Agreement are for reference only and shall not
define or limit any of the terms or provisions hereof.

 

8.9                                 Counterparts.  This
Management Agreement may be executed in two or more counterparts, each of which
shall be deemed an original, and it shall not be necessary in making proof of
this Management Agreement to produce or account for more than one such
counterpart.

 

8.10                           Entire Agreement.  This Management Agreement (including the
Property Amendments) contains the entire understanding and all agreements
between Owner and Manager respecting the management of the Properties.  There are no representations, agreements,
arrangements or understandings, oral or written, between Owner and Manager
relating to the management of the Properties that are not fully expressed
herein.

 

8.11                           Disputes.  If there shall be a dispute between Owner and
Manager relating to this Management Agreement resulting in litigation, the
prevailing party in such litigation shall be entitled to recover from the other
party to such litigation such amount as the court shall fix as reasonable
attorneys’ fees.

 

8.12                           Activities of Manager.  The obligations of Manager pursuant to the
terms and provisions of this Management Agreement shall not be construed to
preclude Manager from engaging in other activities or business ventures,
whether or not such other

 

16

 

activities or ventures are in competition with Owner or the business of
Owner.

 

8.13                           Independent Contractor.  Manager and Owner shall not be construed as
joint venturers or partners of each other pursuant to this Management
Agreement, and neither shall have the power to bind or obligate the other
except as set forth herein.  In all respects,
the status of Manager to Owner under this Management Agreement is that of an
independent contractor.

 

8.14                           No
Third-Party Rights.  Nothing
expressed or referred to in this Management Agreement will be construed to give
any Person other than the parties to this Management Agreement any legal or
equitable right, remedy or claim under or with respect to this Management
Agreement or any provision of this Management Agreement, except such rights as
shall inure to a successor or permitted assignee pursuant to Section 8.3.

 

8.15                           Ownership of Proprietary Property.  The Manager retains ownership
of and reserves all Intellectual Property Rights in the Proprietary
Property.  To the extent that
Owner has or obtains any claim to any right, title or interest in the
Proprietary Property, including without limitation in any suggestions,
enhancements or contributions that Owner may provide regarding the Proprietary
Property, Owner hereby assigns and transfers exclusively to the Manager all
right, title and interest, including without limitation all Intellectual
Property Rights, free and clear of any liens, encumbrances or licenses in favor
of Owner or any other party, in and to the Proprietary Property.  In addition, at the Manager’s expense, Owner
will perform any acts that may be deemed desirable by the Manager to evidence
more fully the transfer of ownership of right, title and interest in the
Proprietary Property to the Manager, including but not limited to the execution
of any instruments or documents now or hereafter requested by the Manager to
perfect, defend or confirm the assignment described herein, in a form
determined by the Manager.

 

8.16                           Non-Solicitation.  During the period commencing on the date on
which this Management Agreement is entered into and ending one year following
the termination of this Management Agreement, BH OPPORTUNITY REIT II and BH
OPPORTUNITY II LP shall not, without the Manager’s prior written consent,
directly or indirectly, (i) solicit or encourage any person to leave the
employment or other service of the Manager or its affiliates, or (ii) hire,
on behalf of BH OPPORTUNITY REIT II or BH OPPORTUNITY II LP or any other person
or entity, any person who has left the employment within the one-year period
following the termination of that person’s employment with the Manager or its
affiliates.  During the period commencing
on the date hereof through and ending one year following the termination of
this Management Agreement, BH OPPORTUNITY REIT II and BH OPPORTUNITY II LP will
not, whether for its or their own account or for the account of any other
person, firm, corporation or other business organization, intentionally
interfere with the relationship of the Manager or its affiliates with, or
endeavor to entice away from the Manager or its affiliates, any person who
during the term of the Management Agreement is, or during the preceding
one-year period, was a tenant, co-investor, co-developer, joint venturer or
other customer of the Manager or its affiliates.

 

[The remainder of this page has been intentionally left blank.]

 

17

 

IN WITNESS WHEREOF, the parties have executed this Amended and
Restated Property Management and Leasing Agreement as of the date first above
written.

 

 

	
   

  	
  BEHRINGER
  HARVARD OPPORTUNITY

  
	
   

  	
    REIT II, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gerald J.
  Reihsen, III

  
	
   

  	
  Gerald J.
  Reihsen, III

  
	
   

  	
  Executive Vice
  President –

  
	
   

  	
  Corporate
  Development & Legal

  
	
   

  	
   

  
	
   

  	
  BEHRINGER
  HARVARD OPPORTUNITY

  
	
   

  	
    OP II LP

  
	
   

  	
   

  
	
   

  	
  By:

  	
  BHO II, Inc.,

  
	
   

  	
  Its General
  Partner

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
    /s/
  Gerald J. Reihsen, III

  
	
   

  	
   

  	
  Gerald J.
  Reihsen, III

  
	
   

  	
   

  	
  Executive Vice
  President –

  
	
   

  	
   

  	
  Corporate
  Development & Legal

  

 

	
   

  	
   

  
	
   

  	
  BEHRINGER
  HARVARD OPPORTUNITY II 

  
	
   

  	
    MANAGEMENT SERVICES,
  LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
    /s/
  Gerald J. Reihsen, III

  
	
   

  	
  Gerald J.
  Reihsen, III

  
	
   

  	
  Executive Vice
  President –

  
	
   

  	
  Corporate Development &
  Legal

  

 

 

[Signature Page to Behringer
Harvard Opportunity REIT II, Inc. 

Amended and Restated Property Management and Leasing Agreement]

 

 

Form of Property Amendment

 

	
  Property Description:

  	
         

  
	
   

  	
   

  
	
           

  
	
   

  	
   

  
	
  Legal Name of Owner:

  	
   

  
	
   

  
	
  Jurisdiction of Organization/Incorporation:

  	
        

  
	
   

  
	
  Services to be Provided (if other than in Management
  Agreement):

  
	
   

  
	
   

  	
         

  
	
   

  	
   

  
	
   

  	
         

  
	
   

  	
   

  
	
   

  	
         

  
	
   

  
	
  Alterations to basic terms and conditions of
  Management Agreement (if any):

  
	
   

  
	
   

  	
         

  
	
   

  	
   

  
	
   

  	
         

  
	
   

  	
   

  
	
   

  	
         

  
					

 

 

	
  Manager:

  	
  BEHRINGER HARVARD OPPORTUNITY II 

  
	
   

  	
   MANAGEMENT
  SERVICES, LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Gerald J.
  Reihsen, III

  
	
   

  	
  Executive Vice President – Corporate 

  
	
   

  	
  Development &
  Legal

  
	
   

  	
   

  
	
  Owner:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

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