Investment Research Associates - Page 597




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          hotel management company, Motor Hotel Management, Inc. (Eulich-             
          Management), to operate the motels.  Eulich-Management was                  
          incorporated on January 1, 1975.                                            
               Eulich asked Robert James (James) who had substantial hotel            
          management experience, to serve as Eulich-Management's president            
          and to manage Eulich-Management's day-to-day operations.  Eulich-           
          Management's three shareholders eventually included Eulich (who             
          was the majority shareholder), James, and another longtime                  
          business associate of Eulich.                                               
               By the end of 1975, Eulich-Management had 17 management                
          contracts that were part of the joint venture in which Prudential           
          was the lender and Eulich's company Vantage, Inc., was the                  
          developer.  By the late 1970's, Eulich-Management had a good                
          reputation in providing hotel management services.  Prudential's            
          real estate department staff generally was satisfied with Eulich-           
          Management's management of a number of hotel properties in which            
          Prudential was involved.  By about the early 1980's, Eulich-                
          Management managed hotel properties nationwide in about 20 to 25            
          States.  At that time, however, Eulich-Management did not manage            
          large hotels.                                                               
          2.   Prudential's Gateway Hotel                                             
               In about 1976, Ballard decided that Prudential's real estate           
          department needed to hire an individual possessing substantial              
          expertise in hotels and hotel operations.  Allen Ostroff                    






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