EXHIBIT 10.2
BROKERAGE AGREEMENT
BETWEEN
CONTINENTAL MORTGAGE AND EQUITY TRUST
AND
CARMEL REALTY, INC.
THIS BROKERAGE AGREEMENT dated as of February 11, 1997, between Continental
Mortgage and Equity Trust, a California business trust (the "Trust"), and Carmel
Realty, Inc. (the "Broker"), a Texas corporation.
WITNESSETH:
WHEREAS:
1. The Trust is an active real estate investment trust with funds
available for investment primarily in the acquisition of real estate.
2. The Trust owns a diversified portfolio of real estate which includes
properties which by reason of their size, location and quality, require special
efforts to sell and the Trust desires to sell certain of such property and
acquire additional property from time to time.
3. The Broker and its principal officers have extensive experience in the
sale and purchase of real estate assets.
4. The Broker is duly registered as a real estate broker, and is duly
qualified to procure the listing of real estate for
sale, lease or rental, and prospective purchasers, lessees, and
renters therefor, and has the good will of, and a reputation for dealing with,
the public, and also maintains an office, properly equipped and staffed,
suitable to serving as a real estate broker.
5. In consideration for the non-exclusive opportunity offered hereby, the
Broker is willing to make an effort to sell any of the Trust's properties,
regardless of the size, quality or location of such properties.
NOW THEREFORE, in consideration of the premises and of the mutual covenants
herein contained, the parties agree as follows:
1. PROPERTY SALES. The Trust shall make available to the Broker on a non-
exclusive basis information on real estate assets the Trust desires to sell and
Broker shall work diligently and with its best efforts to sell such real estate.
2. PROPERTY ACQUISITIONS. Broker shall attempt to locate real estate
assets suitable for purchase by the Trust within the parameters set forth by the
Trust from time to time.
3. NO PARTNERSHIP OR JOINT VENTURE. The Trust and the Broker are not
partners or joint venturers with each other, and nothing herein shall be
construed so as to make them such partners or joint venturers or impose any
liability as such on either of them.
4. INDEPENDENT CONTRACTOR. The Broker will be performing professional
services for the Trust as an independent contractor and the Broker will not be
subject to the will and control of the Trust nor will the Trust have the right
to control either the method and the result of the services so performed. The
Trust will not be held responsible for the collection and payment of taxes or
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contributions of any nature on behalf of the Broker including, but not by way of
limitation, contributions on behalf of the Broker for Federal Social Security
(F.I.C.A.) for Federal and State Unemployment Compensation, for State ▇▇▇▇▇▇▇'▇
Compensation Insurance, for State Real Estate Commission Registration, for
State, County and Municipal Occupational Licensing or for insurance, annuity, or
retirement program in which the Broker may participate.
5. BROKERAGE SERVICES. The Broker will perform professional services as a
Registered Real Estate Broker, and the Broker will devote sufficient time and
services on behalf of the Trust to accomplish the mutual purposes of the
parties.
6. HOLD HARMLESS. The Broker will hold the Trust harmless against all
suits, claims, and obligations which the Broker may incur in performing services
as an independent contractor, and the Broker shall have no right to bind,
contract, or obligate the Trust in the performance of services.
7. LEGAL COMPLIANCE. It is understood that the Broker will abide by all
laws, ethical practices and regulations promulgated by the applicable state real
estate commissions or other regulatory bodies.
8. PURCHASE COMMISSION. For locating and negotiating the lease or purchase
of any real property by the Trust, the Broker is to receive a purchase
commission in accordance with the fee schedule attached as Exhibit A to this
Agreement. The aggregate of each purchase price of each property (including the
purchase commission
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paid to the Broker and the Trust's advisor) may not exceed such property's
appraised value at acquisition. Any commission which is paid to the Broker by
the seller shall be credited against the commission to be paid by the Trust
hereunder.
9. REAL ESTATE SALES COMMISSION. For the sale of each property, the Broker
is to receive a real estate sales commission in accordance with the fee schedule
attached as Exhibit A to this Agreement.
10. EXPENSES OF THE BROKER. Without regard to the amount of compensation
received hereunder by the Broker, the Broker shall bear the following expenses:
(a) employment expenses of the personnel employed by the Broker,
including, but not limited to, fees, salaries, wages, payroll taxes, travel
expenses, and the cost of employee benefit plans and temporary help expenses;
(b) advertising and promotional expenses incurred in seeking
investment opportunities for the Trust;
(c) rent, telephone, utilities, office furniture and furnishings, and
other office expenses of the Broker; and
(d) miscellaneous administrative expenses relating to performance by
the Broker of its functions hereunder.
11. OTHER ACTIVITIES OF BROKER. Nothing herein contained shall prevent the
Broker or any of its officers, directors, or employees or any of its affiliates
from engaging in other business activities related to real estate investments or
from acting as broker to any other person or entity (including another real
estate investment
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trust), even though having investment policies similar to the Trust, and the
Broker and its officers, directors, or employees. The Broker shall have a duty
to present to the Trust any investment opportunity that comes to the Broker or
any of its affiliates if such opportunity is within the Trust's investment
policies.
12. TERM; TERMINATION OF AGREEMENT. This Agreement shall continue in force
for a period of twelve months, and thereafter it may be renewed from year to
year, subject to the approval of a majority of the Trustees of the Trust who are
not affiliated with the Broker. Notice of renewal shall be given in writing by
the Trustees to the Broker not less than 60 days before the expiration of this
Agreement or of any extension thereof. Notwithstanding any other provision to
the contrary, this Agreement may be terminated for any reason without penalty
upon written notice by the Trust to the Broker or written notice by the Broker
to the Trust, in the former case by the vote of a majority of the Trustees who
are not affiliates of the Broker.
13. AMENDMENTS. This Agreement shall not be changed, modified, terminated
or discharged in whole or in part except by an instrument in writing signed by
both parties hereto, or their respective successors or assigns, or otherwise as
provided herein.
14. ASSIGNMENT. This Agreement shall not be assigned by the Broker without
the prior consent of the Trust. The Trust may terminate this Agreement in the
event of its assignment by the Broker without the prior consent of the Trust.
Such an assignment or any other assignment of this Agreement shall bind the
assignee
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hereunder in the same manner as the Broker is bound hereunder. This Agreement
shall not be assignable by the Trust without the consent of the Broker, except
in the case of assignment by the Trust to a corporation, association, trust, or
other organization that is a successor to the Trust. Such successor shall be
bound hereunder and by the terms of said assignment in the same manner as the
Trust is bound hereunder.
15. DEFAULT, BANKRUPTCY, ETC. At the option solely of the Trustees, this
Agreement shall be and become terminated immediately upon written notice of
termination from the Trustees to the Broker if any of the following events shall
occur:
(a) If the Broker shall violate any provision of this Agreement, and
after notice of such violation shall not cure such default within 30 days; or
(b) If the Broker shall be adjudged bankrupt or insolvent by a court of
competent jurisdiction, or an order shall be made by a court of competent
jurisdiction for the appointment of a receiver, liquidator, or trustee of the
Broker or of all or substantially all of its property by reason of the
foregoing, or approving any petition filed against the Broker for its
reorganization, and such adjudication or order shall remain in force or unstayed
for a period of 30 days; or
(c) If the Broker shall institute proceedings for voluntary bankruptcy
or shall file a petition seeking reorganization under the Federal bankruptcy
laws, or for relief under any law for the relief of debtors, or shall consent to
the
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appointment of a receiver of itself or of all or substantially all its property,
or shall make a general assignment for the benefit of its creditors, or shall
admit in writing its inability to pay its debts generally, as they become due.
The Broker agrees that if any of the events specified in subsections (b)
and (c) of this Section shall occur, it will give written notice thereof to the
Trustees within seven days after the occurrence of such event.
16. ACTION UPON TERMINATION. From and after the effective date of
termination of this Agreement, pursuant to Sections 12, 14 or 15 hereof, the
Broker shall not be entitled to compensation for further services hereunder but
shall be paid all compensation earned to the date of termination.
17. MISCELLANEOUS. The Broker assumes no responsibility under this
Agreement other than to render the services called for hereunder in good faith,
and shall not be responsible for any action of the Trust in following or
declining to follow any advice or recommendations of the Broker. Neither the
Broker nor any of its shareholders, directors, officers, or employees shall be
liable to the Trust, the Trustees, the holders of securities of the Trust or to
any successor or assign of the Trust except by reason of acts constituting bad
faith, willful misfeasance, gross negligence, or reckless disregard of their
duties.
18. NOTICES. Any notice, report, or other communication required or
permitted to be given hereunder shall be in writing unless some other method of
giving such notice, report, or other
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communication is accepted by the party to whom it is given, and shall be given
by being delivered at the following addresses of the parties hereto:
The Trust:
Continental Mortgage and Equity Trust
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▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: President
The Broker:
Carmel Realty, Inc.
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▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Executive Officer
Either party may at any time give notice in writing to the other party of a
change of its address for the purpose of this Section.
19. HEADINGS. The section headings hereof have been inserted for
convenience of reference only and shall not be construed to affect the meaning,
construction, or effect of this Agreement.
20. GOVERNING LAW. This Agreement has been prepared, negotiated and
executed in the State of Texas. The provisions of this Agreement shall be
construed and interpreted in accordance with the laws of the State of Texas
applicable to agreements made and to be performed entirely in the State of
Texas.
21. EXECUTION. This instrument is executed and made on behalf of the Trust
by an officer of the Trust, not individually but solely as an officer, and the
obligations under this Agreement are not binding upon, nor shall resort be had
to the private property
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of, any of the Trustees, shareholders, officers, employees, or agents of the
Trust personally, but bind only the Trust property.
IN WITNESS WHEREOF, CONTINENTAL MORTGAGE AND EQUITY TRUST and CARMEL
REALTY, INC., by their duly authorized officers, have signed these presents all
as of the day and year first above written.
CONTINENTAL MORTGAGE AND EQUITY TRUST
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
President
CARMEL REALTY, INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
President
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EXHIBIT A
FEE SCHEDULE
The following fees shall be paid by the Company in accordance with the
Brokerage Agreement with Carmel Realty, Inc.
Maximum fee of 5% on the first $2,000,000 of any purchase or sale
transaction of which no more than 4% would be paid to Carmel Realty,
Inc. or affiliates;
Maximum fee of 4% on transaction amounts between $2,000,000 -
$5,000,000 of which no more than 3% would be paid to Carmel Realty,
Inc. or affiliates;
Maximum fee of 3% on transaction amounts between $5,000,000 -
$10,000,000 of which no more than 2% would be paid to Carmel Realty,
Inc. or affiliates;
Maximum fee of 2% on transaction amounts in excess of $10,000,000 of
which no more than 1-1/2% would be paid to Carmel Realty, Inc. or
affiliates.