Exhibit 10.42
MANAGEMENT AGREEMENT
This Management Agreement (the "Agreement") is made and entered into as
of the 17th day of December, 1997, by and between Sahara Imports, Inc., a
Nevada corporation ("Sahara"), and Vinci, Inc., a Nevada corporation (the
"Company").
RECITALS
A. The Company owns a Honda franchised automobile dealership located
at 0000 X. Xxxxxx, Xxx Xxxxx, Xxxxxx 00000 (hereinafter referred to as the
"Dealership").
B. The Company operates the Dealership under the name "Las Vegas
Honda."
C. The Company desires for Sahara to manage the Dealership, and Sahara
desires to manage the Dealership, for the consideration and upon the terms
set forth in this Agreement.
AGREEMENT
For good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, Sahara and the Company agree as follows:
1. MANAGEMENT OF THE DEALERSHIP. The Company hereby engages Sahara
as an independent contractor to manage the Dealership. Sahara shall assume
management responsibilities of the Dealership effective February 1, 1998 (the
"Effective Date"). Sahara shall be responsible for (a) supervising the daily
operations of the Dealership, and (b) making all management and operating
decisions, including (without limitation) decisions concerning sales
practices, inventory management, and personnel matters. Notwithstanding
anything contained in this Agreement to the contrary, the Company shall
retain all authority required under the Company's franchise agreement with
respect to the Dealership until the closing of the transactions contemplated
by that certain Asset Purchase Agreement (the "Purchase Agreement") dated
December 17, 1997, by and among Sahara, the Company, and Xxxxxx X. Xxxxx.
2. TERM. The term of this Agreement shall begin on the Effective
Date and shall terminate (the "Termination Date") upon the earlier of (a) the
closing of the transactions contemplated by the Purchase Agreement, or (b)
the termination of the Purchase Agreement in accordance with the terms and
provisions thereof, including (without limitation) the termination of the
Purchase Agreement for Sahara's failure to timely receive the approval of (i)
American Honda Motor Co., Inc., (ii) the FTC and the Justice Department under
the Xxxx-Xxxxx-Xxxxxx Act, or (iii) the Nevada Department of Motor Vehicles.
3. CONDUCT OF THE BUSINESS OF THE DEALERSHIP. Sahara shall conduct
the Dealership's business according to the ordinary and usual course of the
Dealership's business reasonably
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consistent with past and current practices, and shall not allow the
Dealership to engage in any practice, take any action, or enter into any
transaction outside of the ordinary course of business without the prior
written consent of the Company.
4. MANAGEMENT FEE. As consideration for Sahara managing the
Dealership during the term of this Agreement, the Company shall pay Sahara a
fee in cash (the "Management Fee") in an amount equal to the monthly net
income, before depreciation, amortization, income taxes and other non-cash
charges, resulting from the business and operations of the Dealership. Net
income shall be calculated in accordance with generally accepted accounting
principles. Notwithstanding anything contained in this Agreement to the
contrary, any costs or expenses that are not directly related to the
operation of the Dealership, any deferred costs or expenses of operating the
Dealership that were incurred prior to the Effective Date, and any costs or
expenses of operating the Dealership that are incurred after the Termination
Date, shall be excluded from the calculation of the Management Fee. The
Management Fee for any partial calendar month shall be prorated. The Company
shall pay Sahara the Management Fee for each month or partial month during
the term of this Agreement within fifteen (15) days after the end of such
month or partial month.
5. LICENSES OF THE DEALERSHIP. To the extent permitted under
applicable law, the Company agrees to allow Sahara to use the Dealership's
dealer numbers, dealer licenses, and dealer tags.
6. COOPERATION. The Company shall (a) cause the Dealership to fully
cooperate with Sahara in connection with Sahara's operation of the
Dealership, and (b) name Sahara as an additional insured on all of the
Company's liability insurance policies.
7. CORPORATE EXISTENCE OF THE COMPANY. The Company shall maintain
its corporate existence and good standing in the State of Nevada.
8. INDEMNIFICATION BY SAHARA. Sahara shall indemnify, defend and
hold the Company and its officers, directors, shareholders, employees, agents
and representatives harmless from and against any and all losses, damages,
claims, actions, suits, proceedings, liabilities, obligations, costs and
expenses, including reasonable attorneys' fees, arising out of, in connection
with, or based upon any breach of this Agreement by Sahara which occurred
during the term of this Agreement with respect to the operation of the
Dealership. Sahara's indemnification under this paragraph shall survive the
termination of this Agreement.
9. INDEMNIFICATION BY THE COMPANY. The Company shall indemnify,
defend and hold Sahara and its officers, directors, shareholders, employees,
agents, representatives, parent, and affiliates harmless from and against any
and all losses, damages, claims, actions, suits, proceedings, liabilities,
obligations, costs and expenses, including reasonable attorneys' fees,
arising out of or based upon any act, omission, or event occurring (a) during
the term of this Agreement with respect to the operation of the Dealership if
caused by the negligence or willful misconduct of the Company, (b) during the
term of this Agreement with respect to the Dealership
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other than matters related to the operation of the Dealership, and (c) prior
to and after the Termination Date with respect to the Dealership if the
transactions contemplated by the Stock Purchase Agreement do not close. The
Company shall cause its insurance policies to be modified to name Sahara as
an additional insured. The Company's indemnification under this paragraph
shall survive the termination of this Agreement.
10. AUTHORIZATION AND VALIDITY. The Company has the power and
authority to make, execute, deliver and perform its obligations under this
Agreement and all such action has been duly authorized by all necessary
proceedings on its part. This Agreement has been duly and validly executed
and delivered by the Company and constitutes the valid and legally binding
agreement of the Company enforceable in accordance with its terms.
11. PAYMENT TO THE COMPANY. During the term of this Agreement, Sahara
shall pay the Company $70,000 per month (prorated for any partial month) from
the Effective Date to the Termination Date.
12. MISCELLANEOUS.
(a) GOVERNING LAW. This Agreement shall be governed by, and
construed and enforced in accordance with, the laws of the
State of Nevada.
(b) LITIGATION. If this Agreement or any term or provision
hereof becomes the subject of litigation, the prevailing
party in such litigation shall be entitled to recover from
the non-prevailing party court costs and reasonable
attorneys' fees.
(c) ENTIRE AGREEMENT. This Agreement contains the entire
understanding of the parties hereto with respect to the
subject matter hereof and supersedes all prior agreements,
arrangements and understandings, whether written or oral,
relating to the subject matter hereof.
(d) INVALIDITY. If any provision contained in this Agreement
shall for any reason be held to be invalid, illegal, or
unenforceable in any respect, such provision shall be deemed
modified so as to constitute a provision conforming as
nearly as possible to such invalid, illegal, or
unenforceable provision while still remaining valid and
enforceable; and the remaining terms and provisions
contained herein shall not be affected thereby.
(e) ASSIGNMENT. Sahara shall not assign this Agreement or its
duties hereunder without the prior written consent of the
Company.
(f) AMENDMENT. This Agreement may not be amended by any oral
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agreement or understanding, but only by an amendment in
writing, executed by the parties hereto.
(g) BINDING AGREEMENT. This Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their
respective successors and permitted assigns.
(h) WAIVER. No waiver of any breach or default hereunder shall
be considered valid unless in writing and signed by the
party giving such waiver, and no such waiver shall be deemed
a waiver of any subsequent breach or default of the same or
similar nature.
SAHARA IMPORTS, INC.
By:
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Xxxxxx X. Xxxx, Vice President
VINCI, INC.
By:
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Xxxxxx X. Xxxxx, President
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