EXHIBIT 10.41
MANAGEMENT CONSULTING AGREEMENT
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THIS MANAGEMENT CONSULTING AGREEMENT (the "Agreement"), dated as of
January 30, 1997, by and between Petro Stopping Centers, L.P., a Delaware
limited liability partnership (the "Company"), and Chartwell Investments Inc., a
Delaware corporation (the "Consultant").
WHEREAS, the Company desires to avail itself of the expertise
possessed by the Consultant and consequently has requested that the Consultant
provide it, from time to time, with certain management consultant and advisory
services related to the business, strategy, administration and affairs of the
Company and the review and analysis of certain financial and other transactions;
and
WHEREAS, the Consultant and the Company agree that it is in their
respective interests to enter into a management consulting agreement whereby,
for the consideration specified herein, the Consultant shall provide such
services as an independent consultant to the Company.
NOW THEREFORE, in consideration of the mutual premises and covenants
contained herein, the Company and the Consultant agree as follows:
1. Retention of Consultant. The Company hereby retains the
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Consultant, and the Consultant hereby accepts such retention, upon the terms and
conditions set forth in this Agreement.
2. Effective Date/Term. This Agreement shall commence as of the
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Closing Date (as such term is defined in the Omnibus Agreement (the "Omnibus
Agreement") dated as of October 18, 1996, by and among Xxxxx X. Xxxxxxxx, Xx.
("Xxxxxxxx, Sr."), Xxxxx X. Xxxxxxxx, Xx. ("Xxxxxxxx, Jr.") JAJCO II, Inc., a
Delaware corporation ("JAJCO"), Petro, Inc., a Texas corporation ("Petro" and
together with Xxxxxxxx, Sr., Xxxxxxxx, Jr., and JAJCO, collectively, the
"Xxxxxxxx Group"), Mobil Long Haul, Inc., a Delaware corporation ("Mobil"),
Petro Holdings GP Corp., a Delaware corporation ("Chartwell GP"), Petro Holdings
LP Corp., a Delaware corporation ("Chartwell LP", and together with Chartwell
GP, "Chartwell") and the Company, and shall continue through the period ending
on the tenth anniversary of such date, subject to renewal pursuant to paragraph
5 below (such period, including any renewal hereinafter referred to as the
"Term").
3. Management Consulting Services.
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(a) The Consultant shall advise the Company concerning such
management matters relating to the Company's personnel, business and acquisition
strategy, administration and proposed
financial transactions, and other senior management matters relating to the
Company as the Company shall reasonably and specifically request. The
Consultant shall not be required to devote any specified amount of time to any
such request, and shall be required to devote only so much time to any such
request as the Consultant shall, in its reasonable discretion, deem necessary to
complete such services. Such consulting services shall, in the Consultant's
reasonable discretion, be rendered in person or by telephone or other
communication. The Consultant shall (i) use its reasonable efforts to deal
effectively with all subjects submitted to it hereunder and (ii) endeavor to
further, by performance of its services hereunder, the policies and objectives
of the Company.
(b) The Consultant shall perform all such services as an
independent contractor to the Company. The Consultant is not an agent or
representative of the Company and has no authority to act for or to bind the
Company without its prior written consent.
(c) Subject to the provisions of the Amended and Restated
Partnership Agreement of the Company (the "Partnership Agreement"), this
Agreement shall in no way prohibit the Consultant from engaging in other
activities, whether or not competitive with any business of the Company. The
parties hereto agree that, in the event additional services not contemplated
hereby are requested of the Consultant, the parties hereto shall negotiate the
scope of, and appropriate compensation for, such additional services.
4. Compensation.
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(a) As compensation for the services provided by the Consultant
hereunder, the Company shall pay to the Consultant, as provided herein, an
annual fee (the "Management Fee") of $600,000 for each fiscal year, of the
Company commencing with the Closing Date during the Term. The Management Fee
shall be payable semi-annually, in advance on the first day of the first and
third quarters of each fiscal year of the Company during the Term (except as
provided in Section 4(e) below), or, if such date is not a business day, on the
next succeeding business day. The Company shall pay the Consultant on the date
hereof fee for the first half of 1997.
(b) Beginning with the fiscal year commencing January 1, 1997,
the Company shall pay to the Consultant an additional annual fee of $100,000
(the "Incentive Management Fee") for each fiscal year that the Company's and its
subsidiaries' and affiliates' EBITDA (as used in the Partnership Agreement)
derived from the numbers reported in the audited consolidated financial
statements of the Company and its subsidiaries for such fiscal year equals or
exceeds $45,000,000. The Incentive Management Fee, if any, shall be payable
within ten business days after delivery to the Company of the audited financial
statements for the fiscal year for which the Company is obligated to pay such
Incentive Management Fee.
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Notwithstanding that this Agreement expires if not renewed pursuant to Section 5
thereof and subject to the provisions of Section 14, if the EBITDA for the
fiscal year in which expiration occurs exceeds the amount which would
necessitate payment of an Incentive Management Fee had the agreement not
expired, then the Consultant shall be eligible to receive, and the Company shall
be obligated to pay, the Incentive Management Fee that would otherwise have been
payable if the Agreement remained in effect for the fiscal year in which the
expiration occurred. This Section 4 shall survive the expiration or termination
of this Agreement.
(c) In addition to the payment of the Management Fee and the
Incentive Management Fee, the Company shall reimburse the Consultant for all
out-of-pocket costs and expenses reasonably incurred by the Consultant in
connection with the provision of services hereunder, including legal,
accounting, temporary and overtime secretarial, travel and entertainment fees
and expenses, within 30 days after receipt of a statement of such expense from
the Consultant.
(d) Subject to Section 14 hereof, if the Agreement is terminated
at the Company's option upon 30 days prior notice to the Consultant (the
"Company's Termination Option"), the Consultant shall, within five business days
of termination, receive a payment equal to the amount of compensation the
Consultant would have received thereunder, absent the exercise of the Company's
Termination Option, if the Agreement had not been terminated until the date on
which the Agreement would next have expired if not renewed. For purposes of
determining the Income Management Fee payable to the Consultant pursuant to this
Section 4(d) for each fiscal year after the fiscal year in which the Agreement
was terminated, EBITDA shall be the EBITDA derived for the audited consolidated
financial statement of the Company and its subsidiaries for the fiscal year
immediately preceding the date of termination.
(e) The Management Fee and the Incentive Management Fee shall be
pro rated in the fiscal year in which this Agreement expires by its terms if not
renewed.
5. Renewal. This Agreement shall automatically be renewed by the
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Board of Directors for additional 1-year periods unless the Board of Directors
of the Company determines not to renew the Agreement and gives written notice to
the Consultant of non-renewal at least 60 business days prior to the date in
which the Agreement would otherwise have been renewed. For purposes of
determining the Incentive Management Fee for fiscal years during any renewal
period, the required levels of EBITDA for the Consultant to earn the Incentive
Management Fee for each fiscal year during any renewal shall remain those set
forth in Section 4(b) hereof.
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6. Indemnification. The Company agrees to indemnify and hold the
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Consultant, its officers, employees and agents (each an "Indemnified Party")
harmless against any liability, claim, loss or expenses (the "Damages") to which
an Indemnified Party may become subject as a result of the performance of the
Consultant's services hereunder, such claims, losses or expenses shall be paid
when and as incurred; provided that the Company shall not be liable to an
Indemnified Party for Damages resulting primarily and directly from the
Indemnified Party's bad faith, gross negligence or willful misconduct and
Consultant shall so indemnify the New Partners and their Affiliates (as each
term is defined in the Omnibus Agreement) for Damages arising from its bad
faith, gross negligence or willful misconduct.
7. Notices. Any notice, request, demand or other communications
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required or permitted to be given under this Agreement shall be in writing and
shall be effective and deemed to have been duly given when delivered personally
or on the earlier to occurs of (a) the date of delivery as shown by the return
receipt; (b) two (2) days after the mailing thereof by registered or certified
mail, return receipt requested, with first class postage prepaid; (c)
confirmation of receipt of telecopy; or (d) the day after shipment by a
nationally recognized overnight delivery service. All notices shall be
addressed to the person at the addresses set forth on the signature page hereto.
Any party hereto may at any time and from time to time change its address for
purpose of receiving notices by giving notice thereof to the other party as
provided in this Section 7. Any notice which is required to be made within a
stated period of time shall be deemed timely if made before midnight of the last
day of such period.
8. Binding Agreement; Benefit. This Agreement shall bind and inure
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to the benefit of any heirs or legal representatives of the Consultant and the
Company.
9. Governing Law. This Agreement shall be subject to and governed
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by the laws of the State of Delaware regardless of applicable conflict of laws
rules or principles or the fact that either or both of the parties now is or may
become a resident of a different state or country.
10. Headings. Section headings are used for convenience only and
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shall in no way affect the construction of this Agreement.
11. Entire Agreement; Additional Agreements; Amendments. This
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Agreement contains the entire understanding of the parties with respect to its
subject matter; provided, however, that nothing contained herein shall be
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construed to prevent the Company from contracting with the Consultant for
additional services pursuant to other, separately documented agreements.
Neither this Agreement nor any part hereof may in any way be altered, amended,
extended,
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waived, discharged or terminated except by a written agreement signed by each of
the parties.
12. Successors and Assigns. The benefits of this Agreement shall
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inure to the respective successors and assigns of the parties hereto and of the
Indemnified Parties hereunder and their successors and assigns and
representatives, and the obligations and liabilities assumed hereunder by the
parties hereto shall be binding upon their respective successors and assigns.
Consultant may not assign its rights and obligations hereunder except to an
entity controlled by or under common control with Consultant.
13. Counterparts. This Agreement may be executed in any number of
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counterparts and by each of the parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which
together shall constitute one and the same agreement.
14. Termination. Notwithstanding any other provision of this
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Agreement, the Company shall have the right to terminate this Agreement on
thirty (30) days prior written notice in the event that neither the Consultant
nor any of its affiliates owns any equity interest in the Company acquired by
them from Roadside, Inc. or Sequoia Ventures, Inc. or issued to them by the
Company or its successors in interest. For purposes hereof Petro Holdings GP
Corp. and Petro Holdings LP Corp. and their affiliates shall be deemed
affiliates of the Consultant. In the event of such a termination, the Company
shall not be obligated to pay any further Management Fee or Incentive Management
Fee or other payments hereunder to Consultant, other than any such fees or
payments accrued but unpaid prior to such termination and Consultant shall not
be required to return to the Company any fees previously paid.
15. Confidentiality. The Consultant shall maintain the
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confidentiality of all proprietary information received by it in the course of
its engagement hereunder relating to the Company or its partners, and shall not
use the same for any purpose other than as contemplated herein.
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IN WITNESS WHEREOF, the parties have duly executed this Consulting
Agreement as of the date first above written.
PETRO STOPPING CENTERS, L.P.
By:/s/ X. X. Xxxxxxxx
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Name: X. X. Xxxxxxxx
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Title: President
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Address: 0000 Xxxxxx Xxxxx
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Xx Xxxx, Xxxxx 00000
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CHARTWELL INVESTMENTS INC.
By:/s/ Xxxx Xxxxxx
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Name: Xxxx X. Xxxxxx
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Title: President
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Address: 000 Xxxxx Xxxxxx
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23rd Floor
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Xxx Xxxx, Xxx Xxxx 00000
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