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CM-08-07-192BLUE SHEET FORMAT DATE: July 9, 2008 SUBJECT: City Manager Approval - July 18, 2008 ITEM: Consider executing Supplemental Agreement No. 1 to "Texas Association of Realtors Commercial Property Management Agreement" with D. Quick Commercial Management, Inc. Department: Finance Staff Person: Howard Baker Justification: Commercial Property Management Agreement for 231 East Main Street Building Funding: Cost: $700 a Month Management Fee. Source of funds: Monthly fee is deducted from rent collected. Outside Resources: Background Information: Public Comment: N/A Blue Sheet Format Updated 01/20/04 SUPPLEMENTAL AGREEMENT NO. 1 TO "TEXAS ASSOCIATION OF REALTORS® COMMERCIAL PROPERTY MANAGEMENT AGREEMENT" WITH D. QUICK COMMERCIAL MANAGEMENT, INC. By signature hereon, both parties expressly accept and agree that this "Supplemental Agreement No. 1" shall amend and supplement "Texas Association of Realtors® Commercial Property Management Agreement", and any other documents which are made a part of the Agreement by reference or incorporation. Additionally, both parties expressly accept and agree that all such contract documents are complementary, and what is required by one shall be as binding as if required by all. Additionally, both parties expressly accept and agree that, in the event of disagreement, the following order of precedence of documents shall govern interpretation: (a) this signed Supplemental Agreement No. 1 shall have top priority; and (b) the signed Agreement shall have second priority. For good and sufficient consideration, which the parties hereby affirm, the parties contractually agree as follows: (1) Under 4. "Authority of Broker," section A. entitled "Management Authority" shall be struck through as written, and shall be replaced with the following: A. Management Authority: Owner grants to Broker the following authority: (2) Under 4. "Authority of Broker," section A. subsection (1) shall be struck through as written, and shall be replaced with the following: (1) collect and deposit for Owner rents and other charges (including but not limited to returned check charges, late charges, and deposits from tenants) in the name of the Broker for the benefit of Owner; and thereafter remit such collections to Owner in one monthly check, together with a report itemizing tenants' names and amounts paid by each. (3) Under 4. "Authority of Broker," section A. subsection (2) and its subsections (2)(a) and 2(b) shaIl all be struck through in their entirety. (4) Under 4. "Authority of Broker," section A. subsection (3) shall be struck through in its entirety. (5) Under 4. "Authority of Broker," section A. subsection (4) shall be struck through in its entirety. (6) Under 4. "Authority of Broker," section A. subsection (6) shall be struck through as written, and shall be replaced with the following: (7) (6) institute and prosecute, at Owner's direction, actions to: (a) evict tenants in the Property; or (b) recover possession of the Property; Under 4. "Authority of Broker," section A. subsection (8) shall be struck through in its entirety. 137805/jkg C�- -o'l9a Under 4. "Authority of Broker," section A. subsection (10) shall be struck through in its entirety. A subsection shall be added as section A. subsection (14), and shall read as follows: (14) invoice Owner on a monthly basis for the any fees due as delineated herein under 12. "Broker's Fees;" (10) A subsection shall be added as section A. subsection (15), and shall read as follows: (15) initiate and/or receive requests for maintenance, repairs, entrance to equipment rooms, and the like on a "24 hour per day, seven days per week" basis; and thereafter immediately refer all such requests to Owner's Facility Maintenance Departments at the following: email FaciiityMaintWorkOrders@,round-rock.tx.us with a cc to howardb(round-rock.tx.us; and/or via emergency pager at 512-204- 8601. (11) Under 4. "Authority of Broker," section B. entitled "Leasing Authority" shall be struck through as written, and shall be replaced with the following: B. Leasing Authority: This Paragraph 4B applies only if Broker has the authority to lease the Property under Paragraph 1C. Owner grants to Broker the following authority, which Broker may exercise when and to the extent directed by Owner after Owner has determined same to be in Owner's best interest: (12) Under 4. "Authority of Broker," section B. subsection (6) shall be struck through in its entirety. (13) Under 4. "Authority of Broker," section B. subsection (9) shall be struck through as written, and shall be replaced with the following: (9) negotiate leases on Owner's behalf for the Property at market rates and on competitively reasonable terms for initial terms to be determined as to length by Owner based upon lease/rental space becoming available; (14) Under 4. "Authority of Broker," section C. subsection (2) shall be struck through in its entirety. (15) Under 4. "Authority of Broker," section C. subsection (4) shall be struck through as written, and shall be replaced with the following: (4) remit to Owner the funds collected by Broker for Owner under this agreement: (16) Under 4. "Authority of Broker," section D. entitled "Security Deposits," including its subsections (1), (2), and (3) and any of their subsections, shall be struck through as written, and shall be replaced with the following: 2 (1) Broker will promptly forward all security deposits to Owner, together with a report itemizing tenants' names and deposit amounts paid by each. (17) Under 4. "Authority of Broker," section F., including its subsections (1), (2), and (3), shall be struck through in its entirety. (18) Under 7. "Reserves," the entire paragraph shall be struck through in its entirety. (19) Under 8. "Advances," the entire paragraph shall be struck through in its entirety. (20) Under 10. "Owner's Cooperation," section A. subsection (7) shall be struck through in its entirety. (21) Under 10. "Owner's Cooperation," section B. subsection (2) shall be struck through as written, and shall be replaced with the following: (2) not rent or lease the Property to anyone without Broker's prior written approval; however, this provision does not apply to Owner's own use; (22) Under 11. "Insurance," section C., including its subsections (1) and (2), shall be struck through in its entirety. (23) Under 12. "Broker's Fees," section A. entitled "Management Fees" shall be struck through as written, and shall be replaced with the following: A. Management Fees: Each month Owner will pay Broker the greater of $700.00 (minimum management fee) or: (24) Under 14. "Expense Reimbursement," the entire paragraph shall be struck through in its entirety. (25) The following paragraphs shall be added under 20. "Special Provisions:" A. NON -APPROPRIATION AND FISCAL FUNDING This Agreement is a commitment of City's current revenues only. It is understood and agreed that City shall have the right to terminate this Agreement at the end of any City fiscal year if the governing body of City does not appropriate funds sufficient to purchase the services as determined by City's budget for the fiscal year in question. City may effect such termination by giving Broker a written notice of termination at the end of its then -current fiscal year. B. PROMPT PAYMENT POLICY In accordance with Chapter 2251, V.T.C.A., Texas Government Code, any payment to be made by City to Broker will be made within thirty (30) days of the date City receives goods under this Agreement, the date the performance of the services under this Agreement are completed, or the date City receives a correct invoice for the goods or services, whichever is later. Broker may charge interest on an overdue payment at the "rate in effect" on September 1 of the fiscal year in which the payment becomes overdue, in accordance with V.T.C.A., Texas 3 Government Code, Section 2251.025(b). This Prompt Payment Policy does not apply to payments made by City in the event: (1) There is a bona fide dispute between City and Broker, a contractor, subcontractor, or supplier about the goods delivered or the service performed that cause the payment to be late; or (2) There is a bona fide dispute between Broker and a subcontractor or between a subcontractor and its supplier about the goods delivered or the service performed that causes the payment to be late; or (3) The terms of a federal contract, grant, regulation, or statute prevent City from making a timely payment with federal funds; or (4) The invoice is not mailed to City in strict accordance with any instructions on the purchase order relating to the payment. C. TERIVIINATION This Agreement may be terminated for any of the following conditions: (1) By City for reasons of its own, with or without cause, and not subject to the mutual consent of any other party, such written termination notice to be given to the other party not less than thirty (30) days prior to termination. (2) By mutual agreement and consent of the parties, such agreement to be in writing. (3) By either party for failure by the other party to perform the services set forth herein in a satisfactory manner, such termination notice to be given in writing to the other party. (4) By either party for failure by the other party to fulfill its obligations herein. (5) By satisfactory completion of all services and obligations described herein. Should City terminate this Agreement as herein provided, no fees other than fees due and payable at the time of termination shall thereafter by paid to Broker. City shall pay Broker for all uncontested services performed to date of notice of termination. If either party defaults in performance of this Agreement or if City terminates this Agreement for default on the part of the other party, then City shall give consideration to the actual costs incurred by Broker in performing the work to the date of default. The termination of this Agreement and payment of an amount in settlement as set forth above shall extinguish all rights, duties, and obligations of City and the terminated party to fulfill contractual obligations. Termination under this section shall not relieve the terminated party of any obligations or liabilities which occurred prior to cancellation. 4 D. INDEPENDENT CONTRACTOR STATUS Broker is an independent contractor, and is not City's employee. Broker's employees or subcontractors are not City's employees. This Agreement does not create a partnership, employer-employee, or joint venture relationship. No party has authority to enter into contracts as agent for the other party. Broker and City agree to the following rights consistent with an independent contractor relationship: (1) Broker has the right to perform services for others during the term hereof. (2) Broker has the sole right to control and direct the means, manner and method by which services required by this Agreement will be performed. (3) Broker has the right to hire assistants as subcontractors, or to use employees to provide the services required by this Agreement. (4) Broker or its employees or subcontractors shall perform services required hereunder, and City shall not hire, supervise, or pay assistants to help Broker. (5) Neither Broker nor its employees or subcontractors shall receive training from City in skills necessary to perform services required by this Agreement. (6) City shall not require Broker or its employees or subcontractors to devote full time to performing the services required by this Agreement. (7) Neither Broker nor its employees or subcontractors are eligible to participate in any employee pension, health, vacation pay, sick pay, or other fringe benefit plan of City. E. WARRANTIES Broker warrants that all services performed hereunder shall be performed consistent with generally prevailing professional or industry standards, and shall be performed in a professional and workmanlike manner. Broker shall re -perform any work not in compliance with this warranty. F. INDEMNIFICATION Broker agrees to hold harmless, exempt, and indemnify City, its officers, agents, directors, servants, representatives and employees, from and against any and all suits, actions, legal proceedings, demands, costs, expenses, losses, damages, fines, penalties, liabilities and claims of any character, type, or description, including but not limited to any and all expenses of litigation, court costs, attorneys fees and all other costs and fees incident to any work done as a result hereof. In no event shall either party be liable to the other for special or consequential damages, statutory or otherwise. 5 G. ASSIGNMENT AND DELEGATION The parties each hereby bind themselves, their successors, assigns and legal representatives to each other with respect to the terms of this Agreement. Neither party may assign any rights or delegate any duties under this Agreement without the other party's prior written approval. H. LOCAL, STATE AND FEDERAL TAXES Broker shall pay all income taxes, and FICA (Social Security and Medicare taxes) incurred while performing services under this Agreement. City will not do the following: behalf; (1) Withhold FICA from Broker's payments or make FICA payments on its behalf; (2) Make state and/or federal unemployment compensation contributions on Broker's (3) Withhold state or federal income tax from any of Broker's payments. If requested, City shall provide Broker with a certificate from the Texas State Comptroller indicating that City is a non-profit corporation and not subject to State of Texas Sales and Use Tax. I. COMPLIANCE WITH LAWS, CHARTER AND ORDINANCES Broker, its consultants, agents, employees and subcontractors shall use best efforts to comply with all applicable federal and state laws, the Charter and Ordinances of the City of Round Rock, as amended, and with all applicable rules and regulations promulgated by local, state and national boards, bureaus and agencies. Broker shall further obtain all permits, licenses and the like required in the performance of the services contracted for herein, and same shall belong solely to City at the expiration of the term of this Agreement. Jr. FINANCIAL INTEREST PROHIBITED Broker covenants and represents that Broker, its officers, employees, agents, consultants and subcontractors will have no financial interest, direct or indirect, in the purchase or sale of any product, materials or equipment that will be recommended or required under this Agreement. K. GRATUITIES AND BRIBES City may, by written notice to Broker, cancel this Agreement without liability if it is determined by City that gratuities and/or bribes in the form of entertainment, gifts, or otherwise were offered or given by Broker or its agents or representatives to any City officer, employee or elected representative with respect to the performance of this Agreement. In addition, Broker may be subject to penalties stated in Title 8 of the Texas Penal Code. 6 L. RIGHT TO ASSURANCE Whenever either party to this Agreement, in good faith, has reason to question the other party's intent to perform hereunder, then and in that event demand may be made to the other party for written assurance of intent to perform. In the event that no written assurance is given within the reasonable time specified when such demand was made, then and in that event the demanding party may treat such failure as an anticipatory repudiation of this Agreement. M. STANDARD OF CARE Broker represents that it is specially trained, experienced and competent to perforin all of the services, responsibilities and duties specified herein and that such services, responsibilities and duties shall be performed, whether by Broker or designated subconsultants, in a manner according to generally accepted industry practices. N. TAXES City is exempt from Federal Excise and State Sales Tax; therefore, tax shall not be included in Broker's charges. O. APPLICABLE LAW; ENFORCEMENT AND VENUE This Agreement shall be enforceable in Round Rock, Texas, and if legal action is necessary by either party with respect to the enforcement of any or all of the terms or conditions herein, exclusive venue for same shall lie in Williamson County, Texas. This Agreement shall be governed by and construed in accordance with the laws and court decisions of the State of Texas. P. EXCLUSIVE AGREEMENT This document, and all appended documents, constitutes the entire Agreement between Broker and City. This Agreement may only be amended or supplemented by mutual agreement of the parties hereto in writing, duly authorized by action of the City Manager or City Council. Q. DISPUTE RESOLUTION City and Services Provider hereby expressly agree that no claims or disputes between the parties arising out of or relating to this Agreement or a breach thereof shall be decided by any arbitration proceeding, including without limitation, any proceeding under the Federal Arbitration Act (9 USC Section 1-14) or any applicable state arbitration statute. 7 IN WITNESS WHEREOF, the parties have executed this Supplemental Agreement No. 1 as indicated below. ATTEST: Sara L. White, City Secretary R CITY, APPOVED AS TO FORM: an L. Sheets, City Attorney CITY OF ROUND ROCK, TEXAS By: Print Title: Date: 1 j t. VMO (\ 19-$' D. QUICK COMMERCIAL MANAGEMENT, INC. By: Printed Name: ,/0.,42e,v Title: ce ?e# x j - '- Date: G /is/ 8 C080321-1 TEXAS ASSOCIATION OF REALTORS® COMMERCIAL PROPERTY MANAGEMENT AGREEMENT USE OF THIS FORM 81' PERSONS WHO ARE NOT MEMBERS OF THE TEXAS ASSOCIATION OF REALTORS® IS NOT AUTHORIZED. ©Texas Association of REALTORS Inc. 2D05 1. PARTIES: A. The parties to this agreement are: Owner: City of Round Rock Address:221 E. Main Street City, State, Zip: Round Rock, Tx 78664 Phone: Mobile: E -Mail: Fax: Broker: D. Ouick Commercial Management, Inc Address -1000 N. IH -35, Suite A City, State, Zip- Round Rock, Tx 78681 Phone: (512) 255-3000 Mobile - E -Mail: darren@donquick.com Fax: (512) 310-0441 B. If Owner is not an individual, Owner is an: ❑ estate 0 corporation 0 limited liability company (LLC) ❑ trust 0 partnership 0 limited liability partnership (LLP), which entity was charted or created in (State). The individual signing this agreement for the owner represents to Broker that he or she has the authority to bind Owner to this agreement, to act for Owner, and is acting under his capacity as (title) for the Owner. C. Owner appoints Broker as Owner's sole and exclusive agent of the real property described in Paragraph 2 to: ❑ (1) manage the Property, but not lease the Property. O (2) manage and lease the Property. 2. PROPERTY: "Property" means: Address- 231 E. Main, Round Rock, TX 78681 legally described as ROUND ROCK CITY OF, BLOCK 10, LOT 17-19, ACRES .2792 in Williamson County, Texas, together with the following non -real -property items - "Property" also includes any other Property described in any attached Multiple Property Addendum. 3. TERM: A. Primary Term: The primary term of this agreement begins and ends as follows: Commencement Date- March 18, 2008 Expiration Date: March 31, 2009 B. Automatic Extension: Unless either party provides written notice of termination to the other party at least 30 days before the Expiration Date, this agreement will automatically extend on a monthly basis until either party terminates by providing at least 30 days written notice to the other party. ^ (TAR -2202) 5-5-05 Initialed for Identification by Broker/Associate J? and Owner Don Quick & Associates 1000 N ( 135 Suite A, Round Rock TX 78681 Phone: 5122553000 Fax: Darren Quick Produced with ZipFoaoT'" by RE FormsNet, LLC 18025 Fifteen Mile Road, Clinton Township, Michigan 48035 www.zInform.com Page 1 of 9 231 E. Main, R 231 E. Main Management Agreement concerning: Round Rock , TX 78 681 4. AUTHORITY OF BROKER: A. Management Authority: Owner grants to Broker the following authority which Broker may exercise when and to the extent Broker determines to be in Owner's interest: (1) collect and deposit for Owner rents and other charges (for example, returned check charges and late charges) from tenants in the Property in a trust account; (2) collect and deposit security deposits from tenants in: 0 (a) a trust account separate from the account described under Paragraph 4A(1); ❑ (b) the same trust account described under Paragraph 4A(1); (3) pay from the account described under Paragraph 4A(1) expenses to operate the Property, including but not limited to, maintenance, taxes, insurance, utilities, repairs, security, management fees, leasing fees, and expenses authorized under this agreement; (4) hire contractors to renovate, remodel, or redecorate the Property provided that Broker does not expend more than $ 250.00 for any single renovation, remodel, or redecoration without Owner's consent; (5) terminate leases for the Property, negotiate lease terminations, and serve notices of termination; (6) institute and prosecute, at Owner's expense, actions to: (a) evict tenants in the Property; or (b) recover possession of the Property; (7) settle, compromise, or withdraw any action described in Paragraph 4A(6); (8) negotiate and make reasonable concessions to tenants or former tenants in the Property; (9) report payment histories of tenants in the Property to consumer reporting agencies; (10) obtain information from any holder of a note secured by a lien on the Property and any insurance company insuring all or part of the Property; (11) authorize inspectors, appraisers, contractors, and other brokers and their associates to access the Property at reasonable times for purposes contemplated by this agreement and to lend keys and disclose security codes to such persons to enter the Property; (12) display or remove signs, as broker determines appropriate, on the Property in accordance with applicable laws, ordinances, and restrictions; and (13) perform other necessary services related to the management of the Property. B. Leasing Authority: This Paragraph 4B applies only if Broker has the authority to lease the Property under Paragraph 1C. Owner grants to Broker the following authority which Broker may exercise when and to the extent Broker determines to be in Owner's interest: (1) advertise the Property for lease by means and methods that Broker determines are reasonably competitive, including but not limited to creating and placing advertisements with interior and exterior photographic and audio-visual images of the Property and related information in any media and the Internet; (2) place "For Lease" signs or other signs on the Property in accordance with applicable laws, regulations, ordinances, restrictions, and owners' association rules; (3) remove all other signs offering the Property for sale or lease; (4) submit the Property as a listing with one or more listing services at any time the Property is marketed for lease and to change or terminate such listings; (5) authorize other brokers, their associates, and their clients to access the Property at reasonable times and to lend keys and disclose security codes to such persons to enter the Property; (6) duplicate keys and access devices to facilitate convenient and efficient showings of the Property and to lease the Property; (7) verify information and references in rental applications from prospective tenants; (8) offer to pay another broker from the compensation Broker receives under this agreement 3-4% % of all rents to be paid under a lease if the other broker procures a tenant who leases the Property; provided that Broker may, at Broker's discretion from time to time, change the amount offered to another broker as long as the amount is competitively reasonable; (TAR -2202) 5-5-05 Initialed for Identification by Broker/Associate ) and Owner Produced with ZipFo.m"' by RE FormsNet, LLC 18025 Fifteen Mile Road, Ctinton Township, Michigan 48035111 PAde2of9 23T E. Main, R 231 E. Main Management Agreement concerning: Round Rock , TX 78681 (9) negotiate and execute leases on Owner's behalf for the Property at market rates and on competitively reasonable terms for initial terms of not Tess than 12 months and not more than 60 months and in accordance with any instructions in Paragraph 20; (10) negotiate and execute any amendments, extensions, or renewals to any leases for the Property on Owner's behalf; (11) collect application fees from prospective tenants; and (12) perform other necessary services related to the leasing of the Property. C. Record Keeping: Broker will: (1) maintain accurate records related to the Property and retain such records for not less than 4 years; (2) file reports with the Internal Revenue Service which Broker may be required to file concerning funds received on behalf of Owner under this agreement (for example, Form 1099); (3) send to Owner each ❑quarter ®month a statement of receipts, disbursements, and charges; and (4) remit to Owner the funds collected by Broker for Owner under this agreement, less authorized deductions: O (a) on a ❑quarterly 0monthly basis; 0 (b) as Owner may instruct from time to time. D. Security Deposits: (1) Broker will: (a) maintain security deposits received from tenants in the trust account described under Paragraph 4A(2); and (b) in accordance with applicable law and the leases for the Property, account to the tenants for the security deposits, make lawful deductions from the security deposits, and return the security deposit balances to the tenants from the trust account. (2) After this agreement ends, Broker will deliver to Owner or the Owner's designee the security deposits held by Broker under leases of the Property, less deductions authorized by this agreement, and will send written notices to the tenants that state: (a) that this agreement has ended; (b) the contact information for the Owner or the Owner's designee; and (c) that Owner is responsible for accounting for and returning the tenant's security deposit. (3) If Broker complies with this Paragraph 4D, Owner will indemnify Broker from any claim or loss from a tenant for the return of a security deposit. This Paragraph 4D survives termination of this agreement. E. Performance Standard: Broker will: (1) use reasonable care when exercising Broker's authority and performing under this agreement; and (2) exercise discretion when performing under this agreement in a manner that Broker believes to be in Owner's interest, provided that Broker will treat any tenant honestly and fairly. F. Deductions and Offset: Broker may disburse from any funds Broker holds in trust for Owner (1) any compensation due Broker under this agreement; (2) any funds Broker is authorized to expend under this agreement; and (3) any reimbursement Broker is entitled to receive under this agreement. G. Insurance and Attorneys: (1) Broker may not file a claim for a casualty loss with the carrier insuring the Property. communicate with the carrier to facilitate the processing of any claim Owner may matters that Owner instructs Broker to communicate to the carrier. (2) Broker may not directly or indirectly employ or pay a lawyer to represent Owner. communicate with Owner's attomey in accordance with Owner's instructions. (TAR -2202) 5-5-05 Initialed for Identification by Broker/Associate and Owner Produced with ZipFomi'"' by RE FormsNet, LLC 18025 Fifteen Mile Road, Clinton Township, Michigan 48035 Broker may file or other Broker may Fe3of9 231 E. Main, R 231 E. Main Management Agreement concerning. Round Rock. TX 78681 5. RELATIONSHIP OE THE PARTIES: This agreement does not create a partnership or joint venture between the parties. Broker is an independent contractor. 6. LEGAL COMPLIANCE: The parties will comply with all obligations, duties, and responsibilities under the Texas Property Code, fair housing laws, and any other statute, administrative rule, ordinance, or restrictive covenant applicable to the use, leasing, management, or care of the Property. 7. RESERVES: Upon execution of this agreement, Owner will deposit the following amount with Broker to be held in a trust account as a reserve for Owner: $ 300.00 . Broker may, at Broker's discretion, use the reserve to pay any expense related to the management of the Property (including but not limited to Broker's fees). If the balance of the reserve becomes less than the amount stated, Broker may: (a) deduct an amount that will bring the balance to the amount stated from any subsequent rent received on behalf of Owner and deposit the amount into the reserve; or (b) notify Owner that Owner must promptly deposit additional funds with Broker to bring the balance to the amount stated. 8. ADVANCES: Owner will, in advance, provide Broker all funds necessary for the leasing and management of the Property. Broker is not obligated to advance any money to Owner or to any other person. 9. OWNER'S REPRESENTATIONS: A. General: Except as disclosed in Paragraph 20, Owner represents that: (1) Owner has fee simple title to and peaceable possession of the Property and all its improvements and fixtures, unless rented, and the legal capacity to lease the Property; (2) Owner is not bound by another agreement for the management of the Property that is or will be in effect during this agreement; (3) if Broker has the authority to lease the Property under Paragraph 1C, Owner is not bound by: (a) another agreement with another broker for the lease of the Property that will be in effect during this agreement; or (b) any agreement or covenant that prohibits owner from leasing the Property; (4) Owner is not delinquent in the payment of any property taxes, owners' association fees, property insurance, mortgage, or any encumbrance on or affecting the Property; (5) the Property is not subject to the jurisdiction of any court; and (6) all information related to the Property that Owner provides to Broker is true and correct to the best of Owner's knowledge. B. Property Condition: Except as stated below, in this agreement, or in any addendum, Owner is not aware of: (1) any condition affecting the Property that materially affects the health or safety of an ordinary tenant; (2) any environmental hazard on the Property; or (3) any violation of any ordinance, statute, restriction, or law related to the Property. 10. OWNER'S COOPERATION: A. Owner agrees to: (1) cooperate with Broker to facilitate the management of the Property; (2) not deal with or negotiate with any tenant in the Property concerning any matter related to the management of the Property but refer ail such dealings to Broker; (3) not enter into a management agreement with another broker for the management of the Property to become effective during this agreement; (4) provide Broker with copies of any existing leases or rental agreements related to the Property; (5) provide Broker with keys and access devices to the Property; (6) provide Broker with copies of all warranties related to the Property or any item in the Property; (7) tender to Broker any security deposits paid by any existing tenants in the Property; (8) complete any disclosures or notices required by law or a lease of the Property; (TAR -2202) 5-5-05 Initialed for Identification by Broker/Associate Qa and Owner \V'—. FP13e 4 of 9 Produced withZipForm' by RE FormsNet LLC 18025 Fifteen Mile Road, Clinton Township, Michigan 48035 .zi f m1. om 231 E. Main, R 231 E. Main Management Agreement concerning: Round Rock, TX 78681 (9) amend applicable notices and disclosures if a material change occurs during this agreement; and (10) notify Broker if Owner becomes delinquent in the payment of: (a) any mortgage or other encumbrance secured by the Property; (b) property taxes; (c) property insurance; or (d) owners' association fees. B. If Broker has the authority to lease the Property under Paragraph 1C, Owner further agrees to (1) cooperate with Broker to facilitate the showing, marketing, and lease of the Property; (2) not rent or lease the Property to anyone without Broker's prior written approval; (3) not negotiate with any prospective tenant who might contact Owner directly, but refer all prospective tenants to Broker; (4) not deal with or negotiate with any tenant in the Property concerning any matter related to the leasing of the Property but refer all such dealings to Broker; and (5) not enter into a listing agreement with another broker for the rental or leasing of the Property to become effective during this agreement. 11. INSURANCE: A. At all times during this agreement, Owner must maintain in effect: (1) a public liability insurance policy that names Broker as a co-insured or additional insured and covers losses related to the Property in an amount of not less than $ 1, 000,000.00 on an occurrence basis; and (2) an insurance policy for the Property in an amount equal to the reasonable replacement cost of the Property's improvements and that contains endorsements which contemplate the leasing of the Property with vacancies between lease terms. B. Not later than the 15th day after the Commencement Date, Owner must deliver to Broker copies of certificates of insurance evidencing the coverage required under Paragraph 11A. If the coverage changes at any time during this agreement, Owner must deliver to Broker a copy of the insurance certificate evidencing the change not later than 10 days after the change. C. If Owner fails to comply with Paragraphs 11A or 11B, Broker may: (1) purchase insurance that will provide Broker the same coverage as the required insurance under Paragraph 11A(1) and Owner must promptly reimburse Broker for such expense; or (2) exercise Broker's remedies under Paragraph 17. 12. BROKER'S FEES: All fees to Broker under this agreement are payable in Williamson County, Texas. This Paragraph 12 survives termination of this agreement with regard to fees earned during this agreement which are not payable until after its termination. Broker may deduct any fees under this Paragraph 12 from any funds Broker holds in trust for Owner. If more than one property or unit is made part of and subject to this agreement. each of the provisions below will apply to each property or unit separately. 0 A. Management Fees: Each month Owner will pay Broker the greater of $ 800.00 (minimum management fee) or: (Check one box only) 0 (1) 4.000 % of the gross monthly rents collected that month. 0 (2) A vacancy in the Property or failure by a tenant to pay rent does not excuse payment of the minimum management fee. Management fees under this Paragraph 12A are eamed daily and are payable not later than the last day of each month. 0 B. Leasing Fees for New Tenancies: Each time the Property is leased to a new tenant, Owner will pay Broker a leasing fee equal to: (Check one box only.) 0 (1) 6.000 % of the gross to be paid under the lease. 0 (2) The leasing fees under this Paragraph 12B are earned and payable at the time the lease is executed. (TAR -2202) 5-5-05 Initialed for Identification by Broker/Associate .0/L2 and Owner , Produced with ZipFom by RE ForrnsNet, LLC 18025 Fifteen Mile Road, Clinton Township, Michigan 48035 ,zioform.com UFjage 5 of 9 231 E. Main, R 231 E. Main Management Agreement concerning. Round Rock , TX 78681 ® C. Renewal or Extension Fees: Each time a tenant in the Property renews or extends a lease, Owner will pay Broker a renewal or extension fee equal to: (Check one box only.) O (1) 3.000 % of the gross rents to be paid under the renewal or extension. ❑ (2) The renewal or extension fees under this Paragraph 12C are eamed at the time the renewal or lease is executed by the parties to the lease and are payable at the time the renewal or extension is effective. For the purposes of this paragraph, a new lease for the same Property with the same tenant then occupying the Property is an extension or renewal. This Paragraph 12C does not apply to month-to-month renewals or month-to-month extensions. ❑ D. Service Fees: Each time Broker arranges for the Property to be repaired, maintained, redecorated, or altered as permitted by this agreement, Owner will pay Broker a service fee equal to: (Check one box only.) 0 (1) 0.000 % of the total cost of each repair, maintenance, alteration, or redecoration. ❑ (2) The service fees under this Paragraph 12D are earned at the time the repair, maintenance, redecoration, or alteration is made and are payable upon Owner's receipt of Broker's invoice. ❑ E. Interest on Trust Accounts: Any trust account Broker maintains under this agreement may be an interest-bearing or income producing account. Broker may retain any interest or income from such account as compensation under this agreement. Broker will remove any interest or income payable under this Paragraph 12E from the trust account not later than the 30th day after the interest or income is paid. 0 F. Administrative Fees: If Broker collects administrative charges from tenants or prospective tenants, including butnot limited to, application fees, retumed check fees, or late charges (as authorized under Paragraph 4A), Broker will retain such fees as compensation under this agreement. The administrative fees under this Paragraph 12F are earned and payable at the time Broker collects such fees. 1 G. Fees Related to Legal Proceedings: If Owner requests or instructs Broker to appear in any legal proceeding or deposition related to the Property (including, but not limited to, evictions, tenant disputes, security deposit disputes, and suits for damages), Owner will pay Broker $ 150.00 per hour for Broker's time expended in the such matters and in preparation of such matters. Fees under this Paragraph 12G are earned at the time the services are rendered and payable upon Owner's receipt of Broker's invoice. 0 H. Fees in the Event of a Sale: (1) Fee if a Tenant Purchases Property: If at any time during this agreement or within days after it ends, Owner sells the Property to a tenant who occupied the Property during the term of this agreement, Owner will pay Broker a fee equal to: (Check one box only) ❑ (a) 0.000 % of the sales price. ❑ (b) Fees under this Paragraph 12H(1) are eamed at the time Owner agrees to sell the Property and are payable at the time the sale closes. (2) Fee if Buyer is Procured through Broker: If during this agreement, Owner agrees to sell the Property to a person other than a tenant who occupied the Property and Broker procures the buyer, directly or through another broker, Owner will pay Broker a fee equal to: (Check one box only.) O (a) 0.000 % of the sales price. O (b) Fees under this Paragraph 12H(2) are eamed at the time Owner agrees to sell the Property and are payable at the time the sale closes. (3) Sale Coordination Fees: If at any time during this agreement Owner agrees to sell the Property and Broker is not paid a fee under Paragraph 12H(1) or (2), Owner will pay Broker for Broker's time and service- o coordinate showing, irnsnections, (TAR -2202) 5-5-05 Initialed for Identification by Broker/Associate _"- and Owner of 9 Produced with ZipFormTM by RE FormsNeL LLC 18025, Fifteen Mile Road, Clinton Township, Michigan 48035 .,, ;. oLI _.I Ai E. Main, R 231 E. Main Management Agreement concerning: Round Rock , TX 78681 appraisals, repairs, and other related matters. Fees under this Paragraph 12H(3) are earned at the time such services are rendered and payable upon Owner's receipt of Broker's invoice. (4) Definition: "Self' means to agree to sell, convey, transfer or exchange any interest in the Property whether by oral or written agreement or option. (5) Separate Listing Agreement Controls: If Owner sells the Property and pays Broker the fee under a separate written listing agreement between Owner and Broker this Paragraph 12H will not apply. ❑ I. Other: 13. RESERVED. 14. EXPENSE REIMBURSEMENT: Upon Owner's receipt of Broker's invoice, Owner will reimburse Broker the following expenses that are related to the leasing or management of the Property: (a) copy charges; (b) charges for long distance telephone calls or facsimile transmissions; (c) regular, express, or certified mail charges; (d) notary fees; (e) photos and videos; (f) reasonable travel expenses, including but not limited to mileage reimbursement (at the standard mileage rate published by the IRS), parking expenses, and tolls; and (g) any other expenditures Broker is authorized to make under this agreement for Owner or that Owner otherwise authorizes Broker to make for Owner. 15. FUNDS RECEIVED AFTER TERMINATION: If Broker receives any funds on behalf of Owner after this agreement ends (for example, rent, damages, past due amounts, and others), Broker will deposit those funds in Broker's trust account and will: (a) pay 0.000 % of the funds received to Broker as compensation for services (for example, research, accounting, communicating, and processing) rendered at that time; and (b) pay the balance of the funds to Owner. This provision survives termination of this agreement. 16. LIABILITY AND INDEMNIFICATION: A. Broker is not responsible or liable in any manner for personal injury to any person or for Toss or damage to any person's real or personal property resulting from any act or omission not caused by Broker's negligence, including but not limited to injuries or damages caused by: (1) other brokers, their associates, inspectors, appraisers, and contractors who are authorized to access the Property; (2) acts of third parties (for example, vandalism, theft, or other criminal acts); (3) freezing or leaking water pipes; (4) a dangerous condition or environmental condition on the Property; or (5) the Property's non-compliance with any law or ordinance. B. Broker is not responsible or liable in any manner for: (1) any late fees or other charges Owner incurs to any creditor caused by late or Insufficient payments by any tenant in the Property; or (2) damages to Owner caused by a tenant's breach of a lease. C. Owner agrees to protect, defend, indemnify, and hold Broker harmless from any damage, costs, attorney's fees, and expenses that: (1) are caused by Owner, negligently or otherwise; (2) arise from Owner's failure to disclose any material or relevant information about the Property; (3) are caused by Owner giving incorrect information to any person; or (4) are related to the management of the Property and are not caused by Broker, negligently or otherwise. (TAR -2202) 5-5-05 Initialed for Identification by Broker/Associate 10 and Owner Produced with ZipFormTM. by RE FormsNet, LLC 18025 Fifteen Mile Road, Clinton Township, Michigan 48035 Kivje7of9 231 E. Main, R 231 E. Main Management Agreement concerning: Round Rock, TX 78681 D. Owner is responsible and liable for all contracts and obligations related to the Property (for example, maintenance, service, repair and utility agreements) entered into before or during this agreement by Owner or by Broker under Broker's authority under this agreement. Owner agrees to hold Broker harmless from all claims related to any such contracts. 17. DEFAULT: A party is in default of this agreement if the party fails to cure a breach or any violation of this agreement within 10 days after receipt of written demand to cure the breach from the other party. If either party is in default, the non -defaulting party may: (a) terminate this agreement by providing at least 10 days written notice; (b) recover all amounts due to the non -defaulting party under this agreement; (c) recover reasonable collection costs and attorney's fees; and (d) exercise any other remedy available at law. Broker is also entitled to recover any compensation Broker would have been entitled to receive if Owner did not breach this agreement. 18. MEDIATION: The parties agree to negotiate in good faith in an effort to resolve any dispute related to this agreement that may arise between the parties. if the dispute cannot be resolved by negotiation, the dispute will be submitted to mediation. The parties to the dispute will choose a mutually acceptable mediator and will share the cost of mediation equally. 19. ATTORNEY'S FEES: If Owner or Broker is a prevailing party in any legal proceeding brought as a result of a dispute under this agreement or any transaction related to or contemplated by this agreement, such party will be entitled to recover from the non -prevailing party all costs of such proceeding and reasonable attorney's fees. 20. SPECIAL PROVISIONS: 21. ADDENDA: Incorporated into this agreement are the following addenda, exhibits, and other information: 1 A. Information About Brokerage Services 0 B. Multiple Property Addendum 0 C. Addendum for Authorization to Act for Owner before Owners' Association 0 D. Copy of Rules and Regulations of an Owners' Association 0 E. Copy of the Owners' Association Bylaws and Deed Restrictions affecting the Property ❑ F. Note: Complete and deliver to Broker IRS W-9 Form or similar form. (TAR -2202) 5-5-05 initialed for Identification by Broker/Associate and OwnerV Produced with ZpFonflTM by RE FormsNet, LLC 18025 Fifteen Mile Road, Clinton Township, Michigan 480 1112 Page 8of9 231 E. Main, R 231 E. Main Management Agreement concerning: Round Rock, TX 78681 22. AGREEMENT OF PARTIES: A. Entire Agreement: This document contains the entire agreement of the parties and may not be changed except by written agreement. B. Assignments: Neither party may assign this agreement without the written consent of the other party. C. Binding Effect: Owner's obligation to pay Broker an earned fee is binding upon Owner and Owner's heirs, administrators, executors, successors, and permitted assignees. D. Joint and Several: All Owners executing this agreement are jointly and severally liable for the performance of all its terms. Any act or notice to, refund to, or signature of, any one or more of the Owners regarding any term of this agreement, its extension, its renewal, or its termination is binding on all Owners executing this agreement. E. Governing Law: Texas law governs the interpretation, validity, performance, and enforcement of this agreement. F. Severability: If a court finds any clause in this agreement invalid or unenforceable, the remainder of this agreement will not be affected and all other provisions of this agreement will remain valid and enforceable. G. Context: When the context requires, singular nouns and pronouns include the plural. H. Notices: Notices between the parties must be in writing and are effective when sent to the receiving party's address, fax, or e-mail address specified in Paragraph 1. 23. INFORMATION: A. Broker's fees or the sharing of fees between brokers are not fixed, controlled, recommended, suggested, or maintained by the Association of REALTORS® or any listing service. B. Federal and state law requires the Property to be shown and made available to all persons without regard to race, color, religion, national origin, sex, disability, or familial status. Local ordinances may provide for additional protected classes (for example, creed, status as a student, marital status, sexual orientation, or age). C. Broker cannot give legal advice. READ THIS AGREEMENT CAREFULLY. If you do not understand the effect of this agreement, consult an attorney BEFORE signing. D. Quick Commercial Management, Inc City of Round Rock Broker's Printed Name License No. By: (/ D�/�5/� g Broker's/Associate's Signature Date B P ner Title: IA/vs QS6 (A.Cyr Date Owner By: Date Printed Name: Title: (TAR -2202) 5-5-05 Produced with ZipFormTM by RE FormsNet, LLC 18025 Fifteen Mile Road, Clinton Township, Michigan 48035 www.zioform,com Page 9 of 9 231 E. Main, R Approved by the Texas Real Estate Commission for Voluntary Use Texas law requires all real estate licensees to give the following information about brokerage services to prospective buyers, tenants, sellers and landlords. Information About Brokerage Services C080321-1 Before working with a real estate broker, you should know that the duties of a broker depend on whom the broker represents. If you are a prospective seller or landlord (owner) or a prospective buyer or tenant (buyer), you should know that the broker who lists the property for sale or lease is the owner's agent. A broker who acts as a subagent represents the owner in cooperation with the listing broker. A broker who acts as a buyer's agent represents the buyer. A broker may act as an intermediary between the parties if the parties consent in writing. A broker can assist you in locating a property, preparing a contract or lease, or obtaining financing without representing you. A broker is obligated by law to treat you honestly. IF THE BROKER REPRESENTS THE OWNER: The broker becomes the owner's agent by entering into an agreement with the owner, usually through a written - listing agreement, or by agreeing to act as a subagent by accepting an offer of subagency from the listing broker. A subagent may work in a different real estate office. A listing broker or subagent can assist the buyer but does not represent the buyer and must place the interests of the owner first. The buyer should not tell the owner's agent anything the buyer would not want the owner to know because an owner's agent must disclose to the owner any material information known to the agent. IF THE BROKER REPRESENTS THE BUYER: The broker becomes the buyer's agent by entering into an agreement to represent the buyer, usually through a written buyer representation agreement. A buyer's agent can assist the owner but does not represent the owner and must place the interests of the buyer first. The owner should not tell a buyer's agent anything the owner would not want the buyer to know because a buyer's agent must disclose to the buyer any material information known to the agent. IF THE BROKER ACTS AS AN INTERMEDIARY: A broker may act as an intermediary between the parties if the broker complies with The Texas Real Estate License Act. The broker must obtain the written consent of each party to the transaction to act as an intermediary. The written consent must state who will pay the broker and, in conspicuous bold or underlined print, set forth the broker's obligations as an intermediary. The broker is required to treat each party honestly and fairly and to comply with The Texas Real Estate License Act. A broker who acts as an intermediary in a transaction: (1) shall treat all parties honestly; (2) may not disclose that the owner will accept a price less than the asking price unless authorized in writing to do so by the owner; (3) may not disclose that the buyer will pay a price greater than the price submitted in a written offer unless authorized in writing to do so by the buyer, and (4) may not disclose any confidential information or any information that a party specifically instructs the broker in writing not to disclose unless authorized in writing to disclose the information or required to do so by The Texas Real Estate License Act or a court order or if the information materially relates to the condition of the property. With the parties' consent, a broker acting as an intermediary between the parties may appoint a person who is licensed under The Texas Real Estate License Act and associated with the broker to communicate with and carry out instructions of one party and another person who is licensed under that Act and associated with the broker to communicate with and carry out instructions of the other party. If you choose to have a broker represent you, you should enter into a written agreement with the broker that clearly establishes the broker's obligations and your obligations. The agreement should state how and by whom the broker will be paid. You have the right to choose the type of representation, if any, you wish to receive. Your payment of a fee to a broker does not necessarily establish that the broker represents you. If you have any questions . regarding the duties and responsibilities of the broker, you should resolve those questions before proceeding. Real! estate licensee asks that you acknowledge receipt of this information about brokerage services for the licensee's records. ord or Tenant Date Texas Real Estate Brokers and Salespersons are licensed and regulated by the Texas Real Estate Commission (TREC). If you have a question or complaint regarding a real estate licensee, you should contact TREC at P.O. Box 12188, Austin, Texas 78711-2188 or 512-465-3960. (TAR -2501) 1/1/96 Don Quick & Associates 1000 N IH 35 Suite A, Round Rock TX 78681 Phone: 5122553000 Fax: Daren Quick Produced with ZipFormTM by RE FormsNet, LLC 18025 Fifteen Mile Road, Clinton Township, Michigan 48035 www.zipfomr.com 01A EOM. IOUS= OPPORTunrr TREC No. OP -K Page 1 of 1 231 E. Main, R