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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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