Exhibit 10.28
SUPPLEMENTAL AGREEMENT TO
GENERAL MOTORS CORPORATION
DEALER SALES AND SERVICE AGREEMENT
This Supplemental Agreement to General Motors Corporation Dealer Sales and
Service Agreement is entered into between Hometown Auto Retailers, Inc. and
General Motors Corporation.
WHEREAS Hometown Auto Retailers, Inc. is interested in acquiring ownership of
one or more GM Dealerships in selected areas of the United States;
WHEREAS, die parties desire to enter into a positive end productive business
relationship which will accomplish our mutual goals and promote sales of GM
products consistent with GM's brand strategy for its products and focus on total
customer enthusiasm;
WHEREAS, the organization and ownership structure of Hometown Auto Retailers,
Inc. and its retail operating systems are such that the terms of the Dealer
Agreement are not wholly adequate to address the legitimate business needs and
concerns of Hometown Auto Retailers, Inc. and GM;
NOW, THEREFORE, the parties agree as follows:
1. Purpose of Agreement
1.1 Purpose of Agreement
The parties acknowledge that Hometown Auto Retailers, Inc. desires
to purchase the stock or assets of one or more current GM
Dealerships and to be appointed as the replacement Dealer by the
appropriate Divisions. The parties further acknowledge that the
ownership arrangements of Hometown Auto Retailers, Inc. and the
operating processes and procedures of Hometown Auto Retailers, Inc.
require that the parties supplement the standard terms and
provisions of the Dealer Agreement to assure that the legitimate
business needs of GM in regard to the representation of its
products are satisfied. The parties have agreed to enter into this
Agreement for that purpose. This agreement shall not apply in any
respect to Saturn Dealers or dealerships, and Hometown Auto
Retailers, Inc. agrees that it will not acquire or attempt to
acquire any Saturn Dealers or dealerships.
1.2 Definitions.
For purposes of this Agreement, the following terms shall have the
meaning indicated:
1.2.1 "Agreement" means this Supplemental Agreement to General
Motors Corporation Dealer Sales and Service Agreement.
1.2.2 "Hometown Auto Retailers, Inc." or "Hometown" means Hometown
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Auto Retailers, Inc.. and its subsidiary Dealer Companies.
1.2.3 "Dealer Agreement" means a General Motors Corporation Dealer
Sales and Service Agreement, a copy of which is attached
hereto as Exhibit A and is incorporated herein by reference.
It also includes my superseding Dealer Agreements.
1.2.4 "Dealer Company" or "Dealer" means the business entity owned
or controlled by Hometown Auto Retailer, Inc. that is a party
to a Dealer Agreement and is defined as the "Dealer" for
purposes of the Dealer Agreement.
1.2.5 "Division" or "Divisions" means one or more of the marketing
divisions of GM; Chevrolet, Pontiac-GMC, Oldsmobile, Buick,
Cadillac.
1.2.6 "GM" means General Motors Corporation.
1.2.7 "GM Dealerships" means a specific, physical location from
which Dealership Operations are conducted by a Dealer pursuant
to the terms of one or more Dealer Agreements. It does not
include Saturn Dealerships.
1.2.8 "Voting stock" means any stock of Hometown Auto Retailers,
Inc. that has voting rights as well as any debt or equity
security of Hometown Auto Retailers, Inc. that is convertible
into stock of Hometown Auto Retailers, Inc. that has voting
rights.
2. Hometown Auto Retailers, Inc. Ownership
2.1 Ownership Structure.
Each Dealer will be a separate company, distinct from Hometown Auto
Retailers, Inc. in the form of either a corporation, partnership or
other business enterprise form acceptable to GM, which is
capitalized in accordance with the "GM Owned Working Capital
Agreement". Each of the Dealer Companies will be owned by Hometown
Auto Retailers, Inc. or may have minority interests held by
employees of that Dealer Company subject to GM approval.
2.2 Hometown Auto Retailers, Inc. hereby warrants that the
representations and assurances contained in this Agreement are
within its authority to make and do not contravene any directive,
policy or procedure of Hometown Auto Retailers, Inc.
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2.3 Change in Ownership. Any material change in ownership of any Dealer
company and any material change in Hometown Auto Retailers, Inc. or
any event described in section 2.4.2(b) shall be considered a change
in ownership of the Dealer Company under the terms of the dealer
agreements and all applicable terms of the Dealer Agreement as
supplemented by this Agreement will apply to any such change.
2.4 Acquisition of Ownership Interests by Third Party. Given the
ultimate control Hometown Auto Retailers, Inc. will have over the
Dealer Companies, and the Divisions' strong interest in assuring
that those who own and control their Dealers have interests
consistent with those of the Divisions, Hometown Auto Retailers,
Inc. agrees to the following;
2.4.1 Hometown Auto Retailers, Inc. will deliver to GM copies of all
Schedules 13D and 13G, and all amendments thereto and termination's
thereof, received by Hometown Auto Retailers, Inc., within five (5)
days of receipt of such Schedules. If Hometown Auto Retailers, Inc.
is aware of any ownership of its stock that should have been
reported to it on Schedule 13D but that is not reported in a timely
manner, it will promptly give GM written notice of such ownership,
with any relevant information about the owner that Hometown Auto
Retailers, Inc. possesses.
2.4.2 If Hometown Auto Retailers, Inc. through its Board of
Directors or through shareholder action proposes or if any person,
entity or group sends Hometown Auto Retailers, Inc. a schedule 13D,
or any amendment thereto, disclosing (a) a binding agreement to
acquire or the acquisition of aggregate ownership of more than
twenty percent (20%) of the voting stock of Hometown Auto Retailers,
Inc. and (b) Hometown Auto Retailers, Inc. through its Board of
Directors or through shareholder action proposes or if any plans or
proposals which relate to or would result in the following: (i) the
acquisition by any person of more than 20% of the voting stock of
Hometown Auto Retailers, Inc. other than for the purposes of
ordinary passive investment (ii) an extraordinary corporate
transaction, such as a material merger, reorganization or
liquidation, involving Hometown Auto Retailers, Inc. or a sale Or
transfer of a material amount of assets of Hometown Auto Retailers,
Inc. and its subsidiaries; or (iii) any change which together with
any changes made to the Board of Directors within the preceding
year, would result in a change in control of the then current board
of directors of Hometown Auto Retailers, Inc. or (iv) in the case of
an entity that produces or controls or is controlled by or is under
common control with an entity that either produces motor vehicles or
is a motor vehicle franchisor, the acquisition by any person entity
or group of more than 20% of the voting stock of Hometown Auto
Retailers, Inc. and any proposal by any such person, entity or group
through the Hometown Auto Retailers, Inc. Board of Directors or
shareholders action to change the
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board of directors of Hometown Auto Retailers, Inc., then if such
actions in GM's business judgment could have a material or adverse
effect on its image or reputation in the GM dealerships or be
materially incompatible with GM's interests (and upon notice of GM's
reasons for such judgment, Hometown Auto Retailers, Inc. agree that
it will take one of the remedial actions set forth in Section 2.4.3
below within ninety (90) days of receiving such Schedule 13D or such
amendment.
2.4.3 If Hometown Auto Retailers, Inc. is obligated under Section
2.4.2 above to take remedial action, it will (a) transfer to GM or
its designee, and GM or its designee will acquire the assets,
properties or business associated with any Dealer Company at fair
market value as determined in accordance with Section 8 below, or
(b) provide evidence to the Divisions (reasonably acceptable to GM)
that such person entity or group no longer has such threshold level
of ownership interest in Hometown Auto Retailers, Inc. or that the
actions described in Section 2.4.2(b) will not occur.
2.4.4 Should Hometown Auto Retailers, Inc. or Dealer Company enter
into an agreement to transfer the assets of a Dealer Company to a
third party, the right of first refusal described in Article 12.3 of
the Dealer Agreement shall apply to any such transfer.
2.4.5 Hometown Auto Retailers, Inc. will describe such provisions of
this Section in any prospectus it delivers in connection with the
offer or sale of its stock or any other securities filing as may be
required by any applicable laws or regulations.
2.5 Officers and Key Management. Hometown Auto Retailers, Inc. agrees to
provide to GM a list of the key management of Hometown Auto
Retailers, Inc. responsibilities in regard to the control and
management of Hometown Auto Retailers, Inc. and each Dealer Company.
Each Dealer Company shall agree to propose to GM any material
changes in the key management of the Dealer Company or their
responsibilities. Such proposal should GM in writing prior to such
change to the extent practicable and shall include sufficient
information to permit GM to evaluate the proposed change consistent
with normal policies and procedures. Hometown Auto Retailers, Inc.
will notify GM in writing of any material change in the key
management of Hometown Auto Retailers, Inc. or their
responsibilities. For purposes of this Agreement, the term "key
management" shall mean CEO, President and Vice Presidents or their
functional equivalents with respect to each dealer company and
executive officers, or their functional equivalent with respect to
Hometown Auto Retailers, Inc.
3. Hometown Auto Retailers, Inc. Operating Policies and Procedures
3.1 GM Brand Strategy. Hometown Auto Retailers, Inc. acknowledges that
GM
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has a Brand Strategy and has invested significant capital in the
development of corporate, divisional and brand image. Relevant
information regarding this strategy has been shared with Hometown
Auto Retailers, Inc.. Hometown Auto Retailers, Inc. agrees to
accommodate GM's Brand Strategy in its Hometown Auto Retailers, Inc.
GM dealership Operations. Hometown Auto Retailers, Inc. will
incorporate in each of its GM Dealerships the following as a minimum
in support of the GM Brand Strategy:
3.1.1 GM has developed retail and service operating standards
for each of its Divisions. At each of its GM
Dealerships, Hometown Auto Retailers, Inc. will
implement and use those divisional standards, or higher
standards which it may develop, subject to GM's
approval.
3.1.2 Dealer marketing associations for each of the Divisions
are an integral part of GM's Brand Strategy. Hometown
Auto Retailers, Inc. agrees that its GM advertising and
marketing practices will support and enhance GM and
Divisional brand and marketing practices and goals.
Hometown Auto Retailers, Inc. agrees and each GM Dealer
Company shall agree that the GM Dealer Company will
participate in the appropriate dealer marketing
association or group as provided in Section 11.
3.1.3 Hometown Auto Retailers, Inc. will not, and will not
permit any Dealer Company to jointly advertise or market
any of their non-GM automotive operations in conjunction
with its approved GM Dealership Operations (it being
understood that the advertising example attached hereto
as Exhibit C will be permissible).
4. Acquisition of GM Dealerships
4.1 In consideration for the representations, covenants and commitments
contained herein, and assuming compliance with the normal
requirements of General Motors regarding transfer of assets and
appointment as a dealer, General Motors will permit the acquisition
of up to five (5) General Motors Dealerships during the period
commencing from the date of this Agreement and ending 24 months
thereafter. If GM requests Hometown Auto Retailers, Inc. to consider
purchasing certain GM dealerships, such dealerships are to be
included in the number of acquisitions. If there is a material
dispute between any GM affiliate and Hometown Auto Retailers, Inc.,
then GM may elect not to approve any public companies dealerships
until the dispute is resolved (even if the pre-approved number has
not been met).
4.2 Following the 24 month period, each Dealer company in which
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Hometown Auto Retailers, Inc. has an investment must be in
compliance with the terms of the General Motors Policies for Changes
in GM Dealership Ownership/Management bulletin of September 19, 1994
(a copy of which has already been provided) including any revisions
or replacements of that bulletin, in order to be approved for
additional acquisitions General Motors Dealerships.
4.3 Multiple Dealer Policy. Hometown Auto Retailers, Inc. recognizes
that customers benefit from competition in the marketplace and agree
that any proposal to acquire additional GM dealerships shall be
subject to the terms of General Motors Multiple Dealer
Investor/Multiple Dealer Operator policies as set forth in NAO
Bulletin 94-11, including any revisions of replacements to the
bulletin.
4.4 GM and Hometown Auto Retailers, Inc. agree that Hometown Auto
Retailers, Inc. will not attempt to acquire more than 50% of the GM
dealerships, by franchise line in a GM defined Multiple Dealer Area.
GM will provide upon Hometown Auto Retailers, Inc. request the
number of GM dealerships, by line, in the Multiple Dealer Area and
the maximum number of dealerships Hometown Auto Retailers, Inc. may
acquire in that Multiple Dealer Area.
4.5 Evaluation of Operations. GM will conduct semi annual evaluation
meetings with the management of Hometown Auto Retailers, Inc. and
the Dealer Operators of each GM Dealer Company to review the
performance of each GM Dealer Company. In the event GM advises
Hometown Auto Retailers, Inc. for any two consecutive evaluation
periods that the performance of a GM dealership is not meeting the
sales volume, Customer Satisfaction or Branding requirements of GM,
an addition to other available remedies, GM will have the right to
demand a change in the management of the dealer company not meeting
those requirements. Hometown Auto Retailers, Inc. will make the
management changes at any deficient dealership within not more than
six (6) months after notice of the deficiencies.
5. Dealership Operations
5.1 Dealership Operations. Each Dealer Company shall be a distinct and
complete business entity which shall include complete Dealership
Operations as that term is defined in the Dealer Agreement
including, but not limited to, sales, service, parts, and used car
operations. This requirement will not preclude certain centralized
functions provided that they are consistent with GM's Channel
Strategy, and that such centralized functions are reviewed with and
approved by GM, which approval shall not be unreasonably withheld.
However, no sales, service or parts operations may be combined with
any non-GM representation and all GM Dealerships will have
reasonable used car operations.
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5.2 GM Channel Strategy. Hometown Auto Retailers, Inc. further
stipulates and agrees that if hometown Auto Retailers, Inc., GM, and
the public are to realize the potential benefits that Hometown Auto
Retailers, Inc. represents to be the result of the acquisitions
proposed by Hometown Auto Retailers, Inc., then an integral
component of the participation by Hometown Auto Retailer, Inc. and
Dealer Company is their agreement that all GM Dealerships shall
fully comply with General Motors Channel Strategy including proper
divisional representation alignment and facilities that are properly
located and that are in compliance with appropriate divisional image
programs. The Channel Strategy is set forth in a memorandum dated
October 5, 1995, from Xxxxxx X. Xxxxxxxx to all GM dealers, and in
the written statement of the strategy as it relates to each of
Dealer Company, copies of which will be provided to Hometown Auto
Retailers, Inc. and each Dealer Company. Hometown Auto Retailers,
Inc. agrees and each Dealer Company shall agree that within 12
months of the acquisition of any GM Dealership that is not
consistent with the Channel Strategy, Hometown Auto Retailers, Inc.
and Dealer Company will have complied with the Channel Strategy for
that location. Notwithstanding the above, GM will consider
reasonable requests from Hometown Auto Retailers, Inc. for an
extension if Hometown Auto Retailers, Inc. is making reasonable
progress and is unable to comply with the Channel Strategy for
reasons beyond Hometown Auto Retailers, Inc. control. If Hometown
Auto Retailers, Inc. and Dealer Company fail to do so within the
time provided, then Hometown Auto Retailers, Inc. will cause Dealer
Company and Dealer Company will agree to terminate the
representation of such products as reasonably required by GM to
comply with the Channel Strategy. If such termination is required,
GM will compensate Hometown Auto Retailers, Inc. the of sum $1,000
for each unit of GM retail planning guide for each Dealer Agreement
so terminated.
5.3 Exclusive Representation. Hometown Auto Retailers, Inc. agree, and
each Dealer Company shall agree that all GM Dealerships shall be
used solely for the exclusive representation of GM products and
related services and in no event shall be used for the display, sale
or promotion or warranty service of any new vehicle other than those
of General Motors Corporation (provided that if Hometown Auto
Retailers, Inc. acquires a GM Dealership having a sales and service
agreement with a competitive automobile manufacturer or importer and
related sales and service operations at the same facility, at GM's
request Hometown Auto Retailers, Inc. shall cause the competitive
sales and service operations to be relocated within one year of
acquisition). Hometown Auto Retailers, Inc., agrees and each Dealer
Company shall agree that should a Dealer Company cease to provide
exclusive representation of GM products, based on the proper
franchise alignment as determined by the Channel Strategy, then that
shall constitute
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good cause in and of itself for the termination of the Dealer
Agreement then in effect with such Dealer Company and Hometown Auto
Retailers, Inc. shall cause Dealer Company to and Dealer Company
shall voluntarily terminate the Dealer Agreements then in effect.
5.4 Image Compliance. Any Dealer Company acquired by Hometown Auto
Retailers, Inc. shall be brought into compliance with applicable
Divisional facility image requirements. Any new construction or
significant interior or exterior remodeling of any GM Dealerships
shall incorporate the appropriate divisional image program and
shall be subject to approval by the appropriate Division before such
construction is undertaken.
5.5 Corporate Name and Tradenames. The corporate name, any tradename or
d/b/a of each GM Dealer Company must include the names of those GM
Divisions represented by such Dealer Company.
5.6 Dealer Company Advertising. Hometown Auto Retailers, Inc. agrees
that the advertising of each of the GM Dealer companies will
maintain and support the GM brand strategy. Newspaper, radio,
television and any other form of advertising will not combine GM
brands or non GM brands, unless GM has approved combined operations
and will clearly identify each GM dealership as a separate entity at
its approved location (it being understood that the advertising
example attached hereto as Exhibit C will be permissible).
6. Dealer Operator
6.1 Appointment of Dealer Operator. For purposes of the Dealer
Agreement, including Paragraph Third and Article 2 and for each GM
Dealership, Hometown Auto Retailers, Inc. shall appoint an
individual who shall act as Executive Manager of that GM Dealership
only and who shall be considered as Dealer Operator for purposes of
the Dealer Agreement. The Divisions will rely upon the personal
qualifications and management skills of Dealer Operator. Hometown
Auto Retailers, Inc. hereby represents that Dealer Operator will
have complete managerial authority to make all decisions, and enter
into any and all necessary business commitments required in the
normal course of conducting Dealership Operations on behalf of
Dealer Company and may take all actions normally required of a
Dealer Operator pursuant to Paragraph Third and Article 2 of the
Dealer Agreement. Hometown Auto Retailers, Inc. will not revoke,
modify or amend such authority without the prior written approval of
the applicable Division (except as provided in Section 6.3 below).
Because of the unique structure of Hometown Auto Retailers, Inc.,
the 15% ownership requirement contained in Article 2 shall not apply
to Dealer Operator.
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6.2 Removal of Dealer Operator. Except as provided in Section 6.3 below,
the removal or withdrawal of Dealer Operator without Divisions'
prior written consent shall constitute grounds for termination of
the Dealer Agreements. However, the Divisions recognize that
employment responsibilities of the Dealer Operator with Dealer
Company may change, making it impractical for the Dealer Operator to
continue to fulfill his/her responsibilities as Dealer Operator. In
that case, or in the event Dealer Operator leaves the employ of the
Dealer Company, Dealer Company shall have the opportunity to propose
a replacement Dealer Operator. The Divisions will not unreasonably
withhold approval of any such proposal, provided the proposed
replacement has the skills and qualifications to act as Dealer
Operator pursuant to the standard policies and procedures of GM.
6.3 Replacement Dealer Operator. Dealer Company shall make every effort
to obtain the consent of the Divisions to a proposed replacement
Dealer Operator prior to the removal or withdrawal of the approved
Dealer Operator. if that is not practical, Dealer Company shall
notify Division in writing within 10 days following the removal or
withdrawal of the approved Dealer Operator. Within 30 days of that
removal or withdrawal, Dealer Company will submit to Division a plan
and appropriate applications to replace Dealer Operator with a
qualified replacement acceptable to Division. The replacement Dealer
Operator must assume his/her responsibilities no later than 90 days
following the withdrawal of the approved Dealer Operator. Hometown
Auto Retailers, Inc. shall be permitted to appoint a temporary
general manager to manage the GM Dealership during the interim
period while the Dealer Operator is being replaced.
7. Dispute Resolution. Hometown Auto Retailers, Inc. agrees not to join any
legal or administrative action a seller of a General Motors dealership may
take against General Motors in the event General Motors declines to
approve a proposed transfer to Hometown Auto Retailers, Inc.. Hometown
Auto Retailers, Inc. and GM stipulate and agree and each Dealer Company
shall stipulate and agree that the dispute resolution process attached
hereto as Exhibit D, or any replacement process offered to all GM Dealers,
shall be the exclusive source of resolution of any dispute regarding the
Dealer Agreements and this Agreement including, but not limited to,
involuntary termination of the Dealer Agreements and/or approval of
Hometown Auto Retailers, Inc. for additional Investment in or ownership of
GM Dealerships. The parties further agree that the Chevrolet dealer
dispute resolution process will be used for the resolution of the matter,
regardless of the GM Division involved.
8. Right to Purchase or Lease. In the event of any termination of the Dealer
Agreement or any transaction or event that would, in effect, discontinue
Dealership Operations from that GM Dealership, or a transfer of assets,
properties or business to GM or a GM designee pursuant to Section 2.4.3,
Hometown Auto Retailers, Inc. agrees and each Dealer Company shall agree
to provide GM with: (a) the right to
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purchase the dealership assets, properties or business for fair market
value based on automotive use, and (b) an assignment of any existing lease
or lease options that are available, subject in each case to any legal or
contractual obligations existing at such time through the process attached
hereto as Exhibit B, that Hometown Auto Retailers, Inc. shall assure GM or
its delegate of quiet possession of the dealership facilities for a period
of not less than five years if the right to have any existing lease or
lease option assigned as set forth above is exercised with respect to such
facilities within ten years of the execution of this Agreement. If,
however, Hometown Auto Retailers, Inc. enters into a financing arrangement
with respect to GM's option as described in this Section 8 would be
subordinated to the interests of any lender in connection with any default
by Hometown Auto Retailers, Inc. under the terms of the financing
arrangement other than a default due to the discontinuance of dealership
operations from such facilities. The Parties agree that GM may exercise
its rights under this Section 8 with respect to some or all of the
dealership facilities to which it may apply at any given time, and that
failure to exercise such rights as to one facility shall not affect GM's
rights as to other facilities.
9. Electronic Funds Transfer. Hometown Auto Retailers, Inc. agrees that each
Dealer Company will use Electronic Funds Transfer (EFT) for settlement of
the dealership obligations to GM and that GM will have a right of offset
for any unpaid debit balances for any Dealer Company at the time the
indebtedness is due and will have the right to collect those amounts from
the account of the Dealer Company that owes the debt or the account of any
other Dealer Company.
10. Compliance with Policies and Procedures. Each Dealer Company must comply
with all terms of the Dealer Agreement and all GM policies applicable to
Dealer company's Dealership Operations. Those procedures include policies
precluding joint advertising and prohibiting sales of GM auction vehicles
from other than the purchasing GM Dealership. Except as specifically
provided herein, all Dealership Operations shall be conducted consistent
with requirements for other GM dealerships.
11. Membership in Dealer Marketing Group. Each GM Dealer Company will join its
respective dealer marketing group and area marketing group including
membership financial support and will participate as a regular member in
meetings and marketing activities.
12. Capital Standards. Hometown Auto Retailers, Inc. agrees and Dealer Company
shall agree that Dealer Company shall maintain, at all times, sufficient
working capital to meet or exceed the minimum net working capital
standards for the Dealer Company as determined from time to time by GM
consistent with its normal practices and procedures. Hometown Auto
Retailers, Inc. and Dealer Company shall provide such documentation as
reasonably requested by GM to assure compliance with that requirement.
Hometown Auto Retailers, Inc. shall submit an annual consolidated balance
sheet for the combined GM Dealership operations of Hometown Auto
Retailers, Inc.
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13. Discontinuance of Representation. In the event that Hometown Auto
Retailers, Inc. determines, voluntarily or otherwise to discontinue
representation in any given Multiple Dealer Area, Hometown Auto Retailers,
Inc. shall grant the right to GM to acquire at fair market value as
determined in accordance with Exhibit B the right to representation of the
Divisions previously represented by any Dealer Company in that Multiple
Dealer Area. GM shall also have the option to acquire the fixed assets
and/or the Dealership Facilities in that Multiple Dealer Area in
accordance with section 8. The terms and conditions for the exercise of
such rights shall be set forth in appropriate and customary documents.
Hometown Auto Retailers, Inc. has received GM's standard option agreements
modified for this Agreement.
14. Supplement to Dealer Agreement. The parties agree that each Dealer Company
shall be required to execute an addendum to the Dealer Agreements binding
the Dealer Company to the applicable portions of this Agreement. For each
Dealer Company, this Agreement shall supplement the terms of the Dealer
Agreements in accordance with Article 17.11 of the Dealer Agreements.
15. Further Modifications. In the event that the policies of GM with regard to
Dealerships owned or controlled in whole or in part by public shareholders
should be modified, the parties agree to review such modifications to
determine whether modification to this Agreement is appropriate.
16. No Third Party Rights. Nothing in this Agreement or the Dealer Agreement
shall be construed to confer any rights upon any person not a party hereto
or thereto, nor shall it create in any party an interest as a third party
beneficiary of this Agreement or the Dealer Agreement. Hometown Auto
Retailers, Inc. and Dealer Company hereby agree to indemnify and hold
harmless GM, its directors, officers, employees, subsidiaries, agents and
representatives from and against all claims, actions, damages, expenses,
costs and liability, including attorneys fees, arising from or in
connection with any action by a third-party in its capacity as a
stockholder of Hometown Auto Retailers, Inc. relating to this Agreement
other than through a derivative stockholder suit authorized by the Board
of Hometown Auto Retailers, Inc. provided that Hometown Auto Retailers,
Inc. shall have the right to assume the defense and control any such
actions or suits and that GM shall not settle any such actions or suits
without Hometown Auto Retailers, Inc. consent (such consent not to be
unreasonably withheld). Notwithstanding the above, GM may choose, at its
own expense, to manage and control its own defense in any such action.
17. Modification of Dealer Agreement. This Agreement is intended to modify and
adapt certain provisions of the Dealer Agreement and is intended to be
incorporated as part of the Dealer Agreement for each Dealer Company. In
the event that any provisions of this Agreement are in conflict with other
provisions of the standard Dealer Agreement, the provisions contained in
this Agreement shall govern. Except as expressly provided in this
Agreement the terms of the Dealer Agreements remain unchanged and apply
herein.
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18. Confidentiality. Each party agrees not to disclose the content of this
Agreement to non-affiliated entities and to treat the Agreement with the
same degree of confidentiality as it treats its own confidential documents
of the same nature, except as expressly provided by Article 2.3.5 of this
Agreement or unless authorized by the other party, required by law,
pertinent to judicial or administrative proceedings or to proceedings
under the Dispute Resolution Process.
19. Duration of Agreement. This Agreement remains in effect so long as
Hometown Auto Retailers, Inc. or any successor thereto, directly or
indirectly holds or has an agreement to hold an ownership interest in any
GM Dealer Company.
IN WITNESS WHEREOF, the parties have executed this Agreement this 20th day of
July, 1998.
HOMETOWN AUTO RETAILERS, GENERAL MOTORS CORPORATION
INC.
By: /s/ Xxxxxxx X. Xxxxxx By: /s/ X. X. Xxxxxxxxxx
---------------------- ------------------------------
V. Pres X. X. Xxxxxxxxxx, III
---------------------- General Manager
---------------------- North American Operations
---------------------- Dealer Network Investment and Development
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