EXHIBIT 10.2
MANAGEMENT SERVICES AGREEMENT
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THIS MANAGEMENT SERVICES AGREEMENT ("Agreement") is made as of January
1, 2005, by and among ISP Management Company, Inc., a Delaware corporation
("ISP") Xxxxxx Properties, LLC, a Connecticut limited liability company and
Xxxxxx Investment Associates Limited Partnership, a Connecticut limited
partnership (collectively, the "Xxxxxx Entities").
WHEREAS, the Xxxxxx Entities desire to have ISP provide certain
management services to each of them and certain of their affiliates; and
WHEREAS, ISP desires to have the Xxxxxx Entities provide certain
advising services to it and certain of its affiliates; and
WHEREAS, ISP and the Xxxxxx Entities are willing to provide such
services to each other, but will incur certain costs and expenses relating to
those services; and
WHEREAS, the Xxxxxx Entities desire to establish management fees
payable to ISP in order to more appropriately reflect the usage of such
management services provided by ISP and the costs to ISP of providing such
management services, and
WHEREAS, ISP desires to establish advising fees payable to each of the
Xxxxxx Entities in order to more appropriately reflect the usage of such
services provided by the Xxxxxx Entities and the costs to the Xxxxxx Entities of
providing such services;
NOW, THEREFORE, in consideration of the mutual promises contained
herein, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, and subject to the conditions
contained herein, the parties hereby agree as follows:
1. Term. The term of this Agreement shall commence as of January 1, 2005 and
shall continue up to and including December 31, 2005 (the "Initial Term").
This Agreement may be renewed for additional terms of one (1) year (each a
"Renewal Term") unless terminated in writing by the parties hereto by
giving such notice not less than thirty (30) days prior to the expiration
of the Intitial Term or any Renewal Term.
2. Provision of Services. (a) ISP, or one of its affiliates, agrees to provide
to the Xxxxxx Entities, or an affiliate, to the extent required, the
management services listed on Exhibit A attached hereto and made a part
hereof, wherever rendered, which shall be provided on a continuous basis
without specific request.
The management services listed on Exhibit A shall not be deemed
exhaustive and may be changed according to the changing business needs of
the parties hereto from time to time upon mutual agreement among such
parties (all services provided by ISP pursuant to this Agreement are
hereinafter collectively referred to as the "ISP Services").
(b) Each of the Xxxxxx Entities agrees to provide to ISP, and from
time to time at ISP's request, the other parties to that certain Amended
and Restated Management Agreement dated as of January 1, 1999 as amended,
either through ISP or directly to the parties, and to the extent required,
the advisory services listed on Exhibit B attached hereto and made a part
hereof, wherever rendered, which shall be provided on a continuous basis
without specific request.
The services listed on Exhibit B shall not be deemed exhaustive
and may be changed according to the changing business needs of the parties
hereto from time to time upon mutual agreement among such parties (all
services provided by Xxxxxx Entities pursuant to this Agreement are
hereinafter collectively referred to as the "Xxxxxx Entities Services").
3. Fees. In consideration of ISP providing the ISP Services hereunder, the
Xxxxxx Entities shall pay to ISP a management fee (the "Management Fee") as
set forth on Exhibit C attached hereto and made a part hereof. In
consideration of the Xxxxxx Entities providing the Xxxxxx Entities Services
hereunder, ISP shall pay to the Xxxxxx Entities an advisory fee (the
"Advisory Fee") as set forth on Exhibit C attached hereto and made a part
hereof. The parties may replace Exhibit C from time to time to reflect
adjustments to the Management Fee and/or the Advisory Fee. The Management
Fee and/or the Advisory Fee shall be payable quarterly in arrears.
4. Reimbursement of Expenses.
(i) To the extent ISP or the Xxxxxx Entities pays any expense attributable
to the other party for reasons of administrative convenience (a
"Reimbursable Expense"), ISP or the Xxxxxx Entities shall promptly
xxxx the other party for the amount thereof, and the other party shall
promptly pay such invoice. If a Reimbursable Expense is part of a
combined or consolidated expense billed or otherwise charged to ISP or
the Xxxxxx Entities though incurred for the benefit of both parties,
the party for whose benefit such expense was incurred shall endeavor
to arrange for direct billing or charging to them of their respective
portions of such expense.
(ii) If ISP or the Xxxxxx Entities bills the other party for Reimbursable
Expenses during a calendar quarter, it shall provide to the other
party, following the completion of such quarter, a statement
indicating all amounts invoiced during such quarter and whether such
amounts have been paid.
(iii) Any shared third party charges shall be allocated among the parties
hereto on such basis as ISP, in consultation with the Xxxxxx
Entities, shall reasonably determine.
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(iv) If, at the request of the Xxxxxx Entities, ISP performs services
outside of the normal scope of the Services provided hereunder, the
Xxxxxx Entities shall pay ISP such fee therefor as is reasonably
designated by ISP in advance of performing such services.
5. Warranty. The parties hereto warrant that they will employ sufficient and
properly skilled personnel to perform the ISP Services and the Xxxxxx
Entities Services in a professional manner. It is understood that ISP may
enter into contracts with third party suppliers to supply the ISP Services
and shall take into account the best interests of the Xxxxxx Entities in
negotiating the terms and conditions of such contracts. If necessary for
ISP's effective exercise of its responsibilities hereunder, the Xxxxxx
Entities shall designate authorized representatives of ISP as their
officers and employees, subject to all of the other terms of this
Agreement.
6. Records and Audit. A party that bills the other for Reimbursable Expenses
shall make and maintain accurate and complete records of such expenses and
the basis for all invoices therefor, and shall ensure that there is no
duplication in the invoicing of costs to such party. A party that pays any
Reimbursable Expenses invoiced to it shall have the right to audit the
records relating thereto from time to time during normal business hours.
7. Amendments.
(i) The parties acknowledge that the Management Fee and Advisory Fee has
been established to reflect the cost to both parties of providing the
ISP Services and the Xxxxxx Entities Services hereunder on the date
hereof. In the event of a change of circumstances that materially
affects the cost to either party of providing any services hereunder,
including, without limitation, a substantial increase in the services
provided by either party hereunder, the parties shall negotiate in
good faith such amendments to this Agreement as may be appropriate to
take into account the effect of any such changes of circumstances.
Such amendments may include, without limitation, an increase or
decrease of the Management Fee or Advisory Fee.
(ii) Subject to paragraph (iii) of this Section 7, any amendment,
modification or waiver of any provision of this Agreement shall only
be effective if evidenced by a written instrument signed by an
authorized representative of ISP and an authorized representative of
each of the Xxxxxx Entities affected by such amendment, modification
or waiver.
(iii) Notwithstanding anything else to the contrary contained herein, the
list of Services may be revised by mutual agreement of an authorized
representative of each party without the need for a written
instrument.
8. Governing Law. The execution, validity, interpretation and enforcement of
this Agreement shall be governed by the internal laws of the State of New
York without regard to choice of law principles that would lead to the
application of any other state's law.
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IN WITNESS WHEREOF, the parties have executed this Agreement on the date
and year first above written.
ISP MANAGEMENT COMPANY, INC. XXXXXX PROPERTIES, LLC
By: /s/ Xxxxxxxxx X. Xxxxxxxx By: /s/ Xxxxx X. Xxxxxx
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Name: Xxxxxxxxx X. Xxxxxxxx Name: Xxxxx X. Xxxxxx
Title: Senior Vice President and Title: Chief Financial Officer
Chief Financial Officer
XXXXXX INVESTMENT ASSOCIATES
LIMITED PARTNERSHIP
By: /s/ Xxxxxx X. Xxxxxx
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Name: Xxxxxx X. Xxxxxx
Title: General Partner
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EXHIBIT A
Examples of ISP Services
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(i) accounting services;
(ii) computer services;
(iii) legal and corporate secretarial services;
(iv) tax advisory services;
(v) administrative services;
(vi) concierge services, including, but not limited to, travel and
entertainment arrangements and reservations;
(vii) general management services as requested from time to time;
(viii) use of office space located in New York City;
(ix) investment management and advisory services, including, but not limited
to:
(a) portfolio management;
(b) equity management (i.e. Large Cap/Small Cap equities);
(c) bond management (i.e. cash, fixed income);
(d) alternative investments (i.e. hedge funds, swaps, derivatives)
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EXHIBIT B
Examples of Xxxxxx Entities Services
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(i) corporate development;
(ii) strategic acquisitions;
(iii) risk arbitrage;
(iv) all aspects of real estate and property portfolio management
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EXHIBIT C
Fees (annual aggregate amount)
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ENTITY FEE
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Xxxxxx Properties (to ISP) $245,000
Xxxxxx Investment Associates (to ISP) $470,000
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Total fees payable by Xxxxxx Entities to ISP $715,000
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ISP (to Xxxxxx Properties) $230,000
ISP (to Xxxxxx Investment Associates) $200,000
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Total fees payable by ISP to Xxxxxx Entities $430,000
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