EXHIBIT 10.9
Expense Allocation Agreement
THIS AGREEMENT is made as of the 19th day of June 1998 (the
"Agreement"), by and between Xxxxxxx Capital Management, Inc., a District of
Columbia corporation ("CCM") and The Xxxxxxx Co., a Maryland corporation
("CCO") to allocate certain business expenses among CCO and CCM.
WHEREAS, CCM and CCO are affiliated entities, each controlled as of the
date of this Agreement by Xxxxxx X. Xxxxxxx, Xx.;
WHEREAS, CCM and CCO have shared and seek to continue to share,
certain administrative, equipment and personnel expenses incurred in
connection with the operation of their respective businesses;
WHEREAS, CCM and CCO desire to enter into this Agreement governing
the future allocation of certain expenses shared between CCM and CCO in
connection with the operation of their respective businesses;
NOW THEREFORE, in consideration of the mutual agreements and terms
herein contained, and for other good and valuable consideration, the receipt
and sufficiency of which is hereby acknowledged, CCM and CCO do hereby agree
as follows:
AGREEMENT
1. CCM hereby agrees to provide for monthly payment to CCO for
shared expenses incurred in connection with the operation of the businesses
of CCM and CCO as detailed and expressly set forth in the column entitled
"Basis of Allocation" on Schedule I to this Agreement (the "Basis of
Allocation").
2. To the extent that the calculation contained in the Basis of
Allocation, does not provide for the payment of a fixed sum each month, the
amount owed by CCM shall be automatically re-valued each month in accordance
with the provisions of the Basis of Allocation and the calculations contained
therein. Such automatic monthly valuations, provided that they do not deviate
from the calculations and provisions of the Basis of Allocation, shall not
constitute an amendment to the Agreement.
3. Payment by CCM, contemplated above, shall be received by CCO by
the tenth (10th) day of each month in which an amount is due. Failure to
provide for payment by this date shall give rise to, at the election of and
upon written notification by CCO, an additional fee at an annualized rate of
five percent (5%) of the late balance outstanding.
4. CCO hereby agrees to make timely payments, on behalf of CCM, to
lessors, vendors, employees, officers or any other party to whom shared
expenses of CCM and CCO are owed, as contemplated by this Agreement.
5. This Agreement may be amended at any time by mutual written
agreement executed by the parties.
6. This Agreement may be terminated by either party upon 30 days
prior written notice.
7. This Agreement shall continue in effect until properly terminated
by either party.
8. This Agreement shall be governed by and shall be construed in
accordance with the laws of the state of Maryland without regard to principles
of conflicts of law.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
as of the date first written above.
XXXXXXX CAPITAL MANAGEMENT, INC.
BY: /s/ Xxxxxx X. Xxxxxxx, Xx.
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Xxxxxx X. Xxxxxxx, Xx.
President
THE XXXXXXX CO.
BY: /s/ Xxxxxx X. Xxxxxxx, Xx.
--------------------------------
Xxxxxx X. Xxxxxxx, Xx.
President
Schedule I
Expense Allocation
Description Basis of Allocation
Administrative Costs CCM shall pay a
fixed sum of $6,000 per
month for various
administrative costs such
as supplies, faxes,
postage and office space
utilized by CCM.
Salaries Expense CCM shall pay 50%
of the base salaries of
its officers. CCM shall
pay a percentage of the
compensation expense of
its other employees in an
amount equal to the
percentage of time
such employees spend on
CCM's business.
Equipment Rental CCM shall pay
monthly equipment rental
fees in an amount equal
to the percentage of
total compensation
expense (excluding bonus)
allocated to CCM pursuant
to the Basis of
Allocation governing
"Salaries Expense" above.
Bonuses CCM shall pay bonuses to
its employees and
officers pursuant to
terms determined and
approved by its Board of
Directors.
