EXHIBIT 10.7
MANAGEMENT AND CONSULTING AGREEMENT
MANAGEMENT AND CONSULTING AGREEMENT, dated as of February 23, 1999
(this "Agreement"), among XXXXXX AUTOMOTIVE ARKANSAS L.L.C., a Delaware
limited liability company (the "Company"), XxXXXXX COMPANIES, INC., an
Arkansas corporation (the "Consulting Firm"), XXXXXX AUTOMOTIVE GROUP L.L.C.,
a Delaware limited liability company ("Xxxxxx Group") and Xxxxxx X. XxXxxxx,
III ("Consultant").
W I T N E S S E T H :
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WHEREAS, the Company owns and operates certain retail motor vehicle
dealerships located in the State of Arkansas (the "Business");
WHEREAS, the Company desires to retain the management and consulting
services of Consultant, and Consultant desires to provide such services, in
each case on the terms and conditions set forth in this Agreement;
WHEREAS, Xxxxxx Group desires to retain the consulting services of
Consultant, and Consultant desires to provide such services, in each case on
the terms and conditions set forth in this Agreement; and
WHEREAS, the Consultant, as an employee of the Consulting Firm,
desires to provide its services as aforesaid as an employee of the Consulting
Firm, and the Consulting Firm desires to provide to the Company and Xxxxxx
Group the services of the Consultant;
NOW, THEREFORE, in consideration of the premises and mutual
covenants and agreements contained herein and for other good and valuable
consideration, the parties hereto hereby agree as follows:
1. Agreements to Retain. (a) Upon the terms and subject to the
conditions of this Agreement, the Company hereby retains the Consulting Firm
for the purpose of causing Consultant to provide management and consulting
services to the Company, and Consultant and the Consulting Firm hereby each
accepts the terms of retainer herein by the Company.
(b) Upon the terms and subject to the conditions of this Agreement,
Xxxxxx Group hereby retains the Consulting Firm for the purpose of causing
Consultant to provide consulting services to Xxxxxx Group, and Consultant and
the Consulting Firm each hereby accepts the terms of retainer herein by Xxxxxx
Group.
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2. Term; Services to be Provided. (a) Term of Agreement. The term of
this Agreement shall commence on the date of this Agreement (the "Effective
Date"), and shall remain in effect for an initial term expiring on the third
anniversary of the Effective Date (the "Initial Term"); provided, that this
Agreement may be sooner terminated with respect to the consulting and
management arrangements among the Company, the Consulting Firm and Consultant
(the "Company Arrangements"), or with respect to the consulting arrangements
among Xxxxxx Group, the Consulting Firm and Consultant (the "Xxxxxx
Arrangements") (or both), pursuant, in each case, to the applicable provisions
of Section 6 hereof. After the Initial Term, this Agreement may be renewed for
additional one-year terms (each, an "Extended Term") upon the mutual written
consent, in the case of the Company Arrangements, of the Company, the
Consulting Firm and Consultant, and in the case of the Xxxxxx Arrangements, of
Xxxxxx Group, the Consulting Firm and Consultant. The period of time between
the Effective Date and the termination of this Agreement pursuant to its terms
is herein referred to, with respect to the Company Arrangements, as the
"Company Term," and with respect to the Xxxxxx Arrangements, as the "Xxxxxx
Term."
(b) Services to be Provided. (i) During the Company Term, the
Consulting Firm will cause the Consultant to provide, and Consultant agrees to
provide, to the Company, and, at the Company's request, to any direct or
indirect subsidiary of the Company, consulting and management services
equivalent to those services that would be provided by a chief executive
officer of a corporation under the Delaware General Corporation Law
(including, without limitation, those services described in Sections 3.3(b)
and 3.4(d) of the First Amended and Restated Limited Liability Company (the
"LLC Agreement"), dated as of the date hereof), and in addition, such other
services as may be determined from time to time by or under the authority of
the Board of Directors of the Company (the "Company Board"). All such services
will be referred to as the "Company Services." The Consulting Firm will cause
Consultant, and Consultant agrees, to devote his skill, knowledge and working
time sufficient to conscientiously perform the Company Services to his best
ability, subject to the arrangements described in the following sentence. The
Company acknowledges that Consultant is engaged in various business and other
interests that require his time, effort and attention and that Consultant will
continue to participate in these interests and others which require his time,
effort and attention.
(ii) During the Xxxxxx Term, the Consulting Firm will cause the
Consultant to provide, and Consultant agrees to provide, to Xxxxxx Group,
consulting services as may be determined from time to time by or under the
authority of the Board of Directors of Xxxxxx Group (the "Xxxxxx Board"),
which shall include, without limitation, acting as an ongoing intermediary
between Xxxxxx Group and automobile manufacturers. All such services will be
referred to as the "Xxxxxx Services". The Consulting Firm will cause
Consultant, and Consultant agrees, to devote his skill, knowledge and working
time
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sufficient to conscientiously perform the Xxxxxx Services to his best ability,
subject to the arrangements described in the last sentence of Section 2(b)(i),
provided that in the event there is a conflict between the Xxxxxx Services and
the Company Services, the Company Services shall take precedence.
(iii) Each of the Consulting Firm and Consultant hereby represents
that this Agreement and compliance by Consultant with the terms and conditions
of this Agreement will not conflict with or result in the breach of any
agreement to which either Consultant or the Consulting Firm is a party or by
which he or it may be bound.
(iv) Authority of Consultant. Each of the relationships of each of
the Consulting Firm and Consultant to the Company and Xxxxxx Group (and to
their respective affiliates) is that of an independent contractor, and nothing
contained in this Agreement shall be construed as creating a joint venture,
partnership or employment arrangement. The Consulting Firm will cause
Consultant, and Consultant agrees, to discharge all obligations under federal,
state, local or foreign law, regulation or order now or hereafter in force
arising out of its or his provision of services hereunder. Consultant (but not
the Consulting Firm) shall have the power and authority to enter into
contracts in the name of, and on behalf of, the Company or any of its
subsidiaries as if he were an authorized officer of the Company. Neither the
Consulting Firm nor Consultant shall have the power or authority to enter into
contracts in the name of, or on behalf of, Xxxxxx Group or any of its
affiliates, except as may be expressly stated in a written delegation of such
power or authority from Xxxxxx Group.
3. Consulting Fees. (a) In consideration for all Company Services to
be rendered by Consultant to the Company, the Company shall pay to the
Consulting Firm during the Company Term the fees provided in this Section
3(a).
(i) Cash Compensation. The Company shall pay the Consulting Firm an
annual consulting fee of $125,000 ("Company Consulting Fee"), payable in
arrears in equal monthly installments.
(ii) Incentive Compensation. The Company shall pay the Consulting
Firm an additional annual consulting fee, based on the performance of
Consultant for any calendar year, in an amount that the Company Board
shall in its sole discretion determine has been earned by Consultant on
behalf of the Consulting Firm during such year. In addition, Consultant
shall be entitled to participate in any stock option or similar program
of the Company, if adopted, provided that applicable law would permit the
participation of Consultant in such stock option or similar program.
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(b) In consideration for all Xxxxxx Services to be rendered by
Consultant to Xxxxxx Group, Xxxxxx Group shall pay to the Consulting Firm
during the Xxxxxx Term an annual fee of $50,000 ("Xxxxxx Fee"), payable in
arrears in equal monthly installments.
4. Benefits. During the Company Term and the Xxxxxx Term,
Consultant, as an independent contractor, will not be permitted to participate
in any of the life insurance, medical insurance, disability insurance and
other benefits that may be provided to employees of the Company or Xxxxxx
Group from time to time.
5. Expenses. (a) The Company shall reimburse the Consulting Firm for
reasonable travel, lodging and meal expenses incurred by Consultant in
connection with his performance of the Company Services upon submission of
evidence, satisfactory to the Company Board, of the incurrence and purpose of
each such expense.
(b) Xxxxxx Group shall reimburse the Consulting Firm for reasonable
travel, lodging and meal expenses incurred by Consultant in connection with
his performance of the Xxxxxx Services upon submission of evidence,
satisfactory to the Xxxxxx Board, of the incurrence and purpose of each such
expense.
6. Termination of Agreement. (a) Termination Due to Death or
Disability. Consultant's provision of Company Services and Xxxxxx Services
shall automatically terminate upon his death or Disability. For purposes of
this Agreement, "Disability" shall mean a physical or mental disability or
infirmity that prevents the performance by Consultant of his duties hereunder
lasting (or likely to last, based on competent medical evidence presented to
the Company Board and the Xxxxxx Board) for a continuous period of six months
or longer. The reasoned and good faith judgment of the Company Board as to
Disability shall be final and shall be based on such competent medical
evidence as shall be presented to it by Consultant or by any physician or
group of physicians or other competent medical experts employed by Consultant
or the Company to advise the Company Board.
(b) Termination for Cause. (i) Consultant's provision of Company
Services may be terminated for "Cause" by the Company Board.
(ii) Consultants provision of Xxxxxx Services may be terminated for
"Cause" by the Xxxxxx Board.
(iii) "Cause", with respect to the termination of the Company
Services or the Xxxxxx Services, shall mean (A) the willful failure by
Consultant to substantially perform his duties with respect to the Company or
Xxxxxx Group, as the case may be, and continuance of such failure for more
than 20 days after the Company or Xxxxxx Group, as
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applicable, notifies Consultant and the Consulting Firm in writing that
Consultant is failing to substantially perform his duties, which writing shall
specify in reasonable detail sufficient to inform Consultant and the
Consulting Firm of the duties that Consultant is alleged to have failed to
substantially perform and the actions required to cure such failure, (B)
Consultant's engaging in serious misconduct (including, without limitation,
any criminal, fraudulent or dishonest conduct) that is injurious to the
Company or Xxxxxx Group, as applicable, or any of their respective affiliates
or subsidiaries, (C) Consultant's conviction of, or entering a plea of nolo
contendere to, any crime that constitutes a felony or involves moral
turpitude, or (D) the breach by Consultant of any written covenant or
agreement with the Company or Xxxxxx Group, as applicable, or any of their
respective affiliates not to disclose any information pertaining to the
Company or Xxxxxx Group, as applicable, or any of their respective affiliates
or not to compete or interfere with the Company or Xxxxxx Group, as
applicable, or any of their respective affiliates, including without
limitation the covenants set forth in Sections 7, 8, 9 and 10 hereof.
(c) Termination Without Cause. (i) Consultant's provision of Company
Services may be terminated "Without Cause" by the Company Board.
(ii) Consultant's provision of Xxxxxx Services may be terminated
"Without Cause" by the Xxxxxx Board.
(iii) A termination "Without Cause" shall mean, with respect to the
termination of the Company Services of the Xxxxxx Services, a termination of
Company Services or Xxxxxx Services by the Company Board or the Xxxxxx Board,
as applicable, other than due to death or Disability as described in Section
6(a) or Cause as defined in Section 6(b).
(d) Termination by Consultant. (i) Consultant may terminate his
provision of Company Services for "Good Reason".
(ii) Consultant may terminate his provision of Xxxxxx Services for
"Good Reason".
(iii) "Good Reason" shall mean, with respect to the termination of
the Company Services or the Xxxxxx Services, a termination by Consultant of
his provision of Company Services or Xxxxxx Services, as applicable, within 30
days following (A) any material diminution by the Company Board or the Xxxxxx
Board, as applicable, in Consultant's duties, except in connection with
termination of Consultant's provision of services for Cause as provided in
Section 6(b) or death or Disability as provided in Section 6(a), (B) any
requirement by the Company Board or the Xxxxxx Board, as applicable, that
Consultant be based outside of the State of Arkansas or (C) the failure of the
Company or Xxxxxx Group, as applicable, timely to pay Consultant's or the
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Consulting Firm's fees or benefits, provided that (x) Consultant shall have
given the Company or Xxxxxx Group, as applicable, written notice of the
circumstances constituting Good Reason and the Company or Xxxxxx Group, as
applicable, shall have failed to cure such circumstances within 20 days, and
(y) Consultant shall not have caused the occurrence constituting Good Reason
through the exercise of his authority as a consultant to the Company or Xxxxxx
Group, as applicable.
(e) Notice and Effect of Termination. Any termination of
Consultant's provision of Company Services or Xxxxxx Services, as applicable,
by the Company Board or the Xxxxxx Board, as applicable, pursuant to Section
6(a) (in the case of Disability), 6(b) or 6(c), or by Consultant pursuant to
Section 6(d), shall be communicated by a written "Notice of Termination"
addressed to Consultant and the Consulting Firm, the Company or Xxxxxx Group,
as appropriate. A "Notice of Termination" shall mean, with respect to the
Company or Xxxxxx Group, as applicable, a notice stating that Consultant's
provision of Company Services or Xxxxxx Services, as applicable, has been or
will be terminated, indicating the specific termination provisions in this
Agreement relied upon and setting forth in reasonable detail the facts and
circumstances claimed to provide a basis for the termination of the provision
of such services. At any time that the Consultant's provision of Company
Services or Xxxxxx Services is terminated, the Consulting Firm's obligation
with respect to such services shall also be terminated.
(f) Payments Upon Certain Terminations of the Provision of Company
Services.
(i) Termination Without Cause or for Good Reason. (A) In the event
of a termination of Consultant's provision of Company Services by the
Company Board Without Cause or a termination by Consultant of the
provision of Company Services for Good Reason, in either case, prior to
the last day of the Company Term, the Company shall pay to the Consulting
Firm (x) a lump sum in an amount equal to the Company Board's good faith
determination of the present values of the Remaining Fee Amounts (as
defined below), as of the date of such lump sum payment, calculated using
a discount rate equal to the then prevailing interest rate payable on
senior indebtedness of an issuer rated "B" by Xxxxx'x Investors Service
or Standard & Poor's (or the then-equivalent rating) having a term as
close as practicable to the period from the date of termination of the
provision of Company Services through the last day of the Company Term,
plus (y) any additional performance-based fee for the portion of the
calendar year preceding Consultant's Date of Termination (as defined in
Section 6(h)) as the Company Board in its discretion determines to have
been earned by Consultant. "Remaining Fee Amounts" means the Company
Consulting Fees that would have been payable, monthly in arrears, between
the date on which Notice of Termination is
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given as contemplated by Section 6(e) or, if no such Notice is given, the
date of termination of the provision of Company Services (the "Notice
Date"), and the last day of the Company Term, assuming no increase in the
Company Consulting Fee from the rate in effect immediately prior to the
Date of Termination.
(ii) Termination Upon Death or Disability. If Consultant's provision
of Company Services shall terminate upon his death or Disability, the
Company shall pay the Consulting Firm two times the full Company
Consulting Fee at the annual rate in effect immediately prior to the Date
of Termination, plus any additional performance-based fee for the portion
of the calendar year preceding the Date of Termination as the Company
Board in its discretion determines to have been earned by Consultant.
(iii) Termination for Cause or Voluntary Termination by Consultant.
If the Company Board shall terminate Consultant's provision of Company
Services for Cause or if Consultant shall voluntarily terminate his
provision of Company Services for other than Good Reason, the Consulting
Firm shall be paid the Company Consulting Fee through the Date of
Termination at the annual rate in effect immediately prior to the Date of
Termination, provided that the Consulting Firm shall not be paid any
additional performance-based fees for the portion of the calendar year
preceding the Date of Termination.
(g) Payments Upon Certain Terminations of the Provision of Xxxxxx
Services.
(i) Termination Without Cause or for Good Reason. In the event of a
termination of Consultant's provision of Xxxxxx Services by the Xxxxxx Board
Without Cause, or upon Consultant's death or Disability, or in the event of a
termination by Consultant of the provision of Xxxxxx Services for Good Reason,
in any case prior to the last day of the Xxxxxx Term, no later than twenty
(20) days following the Date of Termination, Xxxxxx Group shall pay to the
Consulting Firm in a single lump sum, the full Xxxxxx Fee as set forth in
Section 3(b) for the year in which such termination occurred.
(ii) Termination for Cause or Voluntary Termination by Consultant.
In the event of a termination of Consultant's provision of Xxxxxx Services by
the Xxxxxx Board for Cause or in the event of a voluntary termination by
Consultant of the Xxxxxx Services other than for Good Reason, in any case
prior to the last day of the Xxxxxx Term, no later than twenty (20) days
following the Date of Termination, Xxxxxx Group shall pay to the Consulting
Firm in a single lump sum, a pro rated portion of the Xxxxxx Fee as set forth
in Section 3(b) for the year in which such termination occurred.
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(h) Date of Termination. As used in this Agreement, the term "Date
of Termination" with respect to the Company or Xxxxxx Group, as applicable,
shall mean (i) if Consultant's provision of Company Services or Xxxxxx
Services is terminated by his death, the date of his death, (ii) if
Consultant's provision of Company Services or Xxxxxx Services is terminated by
the Company Board or Xxxxxx Board, as applicable, for Cause or by Consultant
for Good Reason, the later of the date on which (x) the Notice of Termination
is given as contemplated by Section 6(e) and (y) the lapsing of the cure
period described in Section 6(b) or 6(d), as applicable, and (iii) if
Consultant's provision of Company Services or Xxxxxx Services is terminated by
the Company Board or Xxxxxx Board, as applicable, Without Cause, due to
Consultant's Disability or otherwise, whether or not Notice of Termination is
given, 30 days after the date of termination of such services.
7. Covenant Not to Compete. (a) So long as Consultant's provision of
Company Services or Xxxxxx Services hereunder shall continue, or as otherwise
expressly consented to, approved or otherwise permitted by the Company in
writing, and to the fullest extent permitted under applicable law, Consultant
shall not, directly or indirectly engage in, participate in, represent in any
way or be connected with, as an officer, director, partner, owner, employee,
agent, independent contractor, consultant, proprietor or stockholder (except
for the ownership of a less than 5% stock interest in a publicly traded
corporation) or otherwise, any business similar to the Business (as defined in
the Exchange Agreement, dated as of August 4, 1998 (as amended by Amendment
No. 1, dated as of February 23, 1999, the "Exchange Agreement"), among
Consultant, the Company and the other persons named therein) within the State
of Arkansas or within 80 miles of any business owned or controlled by the
Company, Xxxxxx Group or any of their respective affiliates; or
(b) If the Consultant's provision of Company Services and Xxxxxx
Services hereunder is terminated, the following provisions shall apply:
(i) The provisions of Section 7(a) shall continue in effect for the
longer of five years after the Effective Date and two years after the
final Date of Termination;
(ii) During the period described under Section 7(b)(i), Consultant
shall disclose in writing to the Company the name, address and type of
business conducted by any proposed employer or contractor of Consultant
within ten business days of commencing employment (or independent
contract work) with such new employer or contractor. In addition, during
the period described under Section 7(b)(i), but only to the extent that
Consultant is entitled to and requests a payment under clause (iii) of
this Section 7(b), Consultant shall promptly inform the Company in
writing of receipt of any amount, up to an
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amount equal to one hundred percent (100%) of the sum of the Company
Consulting Fee and the Xxxxxx Fee (the "Consulting Fees") per annum,
described in subclause (iii)(y) below; and
(iii) In the event of a termination of Consultant's provision of
Company Services and Xxxxxx Services (A) pursuant to Section 6(b) or (B)
voluntarily by Consultant for any reason other than Good Reason or (C)
due to expiration of both the Company Term and the Xxxxxx Term and any
extensions thereof, so long as this Section 7(b) shall apply, the Company
shall pay Consultant on an annual basis the excess of (x) an amount equal
to one hundred percent (100%) of the Consulting Fees over (y) the total
compensation (whether received as salary, consulting fee or otherwise and
calculated on a pre-tax basis) accrued, earned or received by Consultant
from any new employer, client or contractor during such period, provided
that such excess shall be payable monthly in arrears, provided further,
that the Company shall consider the amount described in clause (iii)(y)
above to be at least one hundred percent (100%) of the Consulting Fees
unless and until Consultant otherwise notifies the Company in writing;
provided, however, that the Company may at any time, in its sole discretion,
terminate all obligations imposed on the Company and Consultant under this
Section 7 by written notice to Consultant, provided further, however, that any
such termination shall not terminate any other non-competition agreement
between the Company or its affiliates (including Xxxxxx Group) and Consultant,
provided further, that notwithstanding such termination the Company shall
continue to make any and all payments required by Section 6(f) hereunder.
Consultant shall be under no obligation to accept any employment during the
period for which Consultant receives continued payments pursuant to Section
7(b)(iii) or to otherwise attempt to mitigate the payment of such amounts by
the Company and the Company waives any right to allege that Consultant has any
duty to mitigate the payment of such amounts.
8. Unauthorized Disclosure. (a) During and after the Company Term
and the Xxxxxx Term, without the written consent of the Company Board or the
Xxxxxx Board, as applicable, or a person authorized thereby, (i) Consultant
shall not disclose to any person (other than an employee or director of the
Company or Xxxxxx Group, as applicable, or their respective affiliates, or a
person to whom disclosure is reasonably necessary or appropriate in connection
with the performance by Consultant of his duties under this Agreement) or use
to compete with the Company or Xxxxxx Group, as applicable, or any of their
respective affiliates any confidential or proprietary information, knowledge
or data that is not theretofore publicly known and in the public domain
obtained by him while providing Company Services or Xxxxxx Services, as
applicable, with respect to the Company or Xxxxxx Group, as applicable, or any
of their respective affiliates or with respect to any products, improvements,
customers, methods of
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distribution, sales, prices, profits, costs, contracts (including, without
limitation the terms and provisions of this Agreement), suppliers, business
prospects, business methods, techniques, research, trade secrets or know-how
of the Company or Xxxxxx Group or any of their respective affiliates
(collectively, "Proprietary Information" of the Company or Xxxxxx Group, as
applicable), and (ii) Consultant shall use best efforts to keep confidential
any such Proprietary Information and to refrain from making any such
disclosure, in each case except as may be required by law or as may be
required in connection with any judicial or administrative proceedings or
inquiry.
(b) The covenant contained in this Section 8 shall survive the
termination of Consultant's provision of Company Services or Xxxxxx Services,
as applicable, and shall be binding upon Consultant's heirs, successors and
legal representatives.
9. Non-Solicitation of Employees. During the period commencing on
the Effective Date and ending on the date that is the later of five years
after the Effective Date and two years after the final Date of Termination
(the "Non-Solicitation Restriction Period"), Consultant shall not, directly or
indirectly, for his own account or the account of any other person or entity
with which he shall become associated in any capacity or in which he shall
have any ownership interest, (a) solicit for employment or employ any person
who, at any time during the preceding 12 months, is or was employed by or
otherwise engaged to perform services for the Company or Xxxxxx Group, or any
of their respective affiliates, regardless of whether such employment or
engagement is direct or through an entity with which such person is employed
or associated, or otherwise intentionally interfere with the relationship of
the Company or Xxxxxx Group, or any of their respective affiliates with any
person or entity who or which is at the time employed by or otherwise engaged
to perform services for the Company or Xxxxxx Group, as applicable, or any
such affiliate or (b) induce any employee of the Company or Xxxxxx Group, or
any of their respective affiliates to engage in any activity which Consultant
is prohibited from engaging in under Sections 7, 8, 9 and 10 hereof or to
terminate his or her employment with the Company or Xxxxxx Group, as
applicable, or such affiliate.
10. Return of Documents. In the event of the termination of
Consultant's provision of Company Services or Xxxxxx Services for any reason,
Consultant will deliver to the Company or Xxxxxx Group, as applicable, all
documents and data of any nature pertaining to his work with the Company or
Xxxxxx Group, as applicable, and their respective affiliates, and he will not
take with him any documents or data of any description or any reproduction
thereof, or any documents containing or pertaining to any Proprietary
Information.
11. Injunctive Relief with Respect to Covenants. Consultant
acknowledges and agrees that the covenants and obligations of Consultant with
respect to
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non-competition, non-disclosure, non-solicitation, confidentiality and the
property of the Company or Xxxxxx Group, as applicable, and their respective
affiliates relate to special, unique and extraordinary matters and that,
notwithstanding any other provision of this Agreement to the contrary, a
violation of any of the terms of such covenants and obligations will cause the
Company or Xxxxxx Group, as applicable, and their respective affiliates
irreparable injury for which adequate remedies are not available at law.
Therefore, Consultant expressly agrees that the Company or Xxxxxx Group, as
applicable, and their respective affiliates (which shall be express
third-party beneficiaries of such covenants and obligations) shall be entitled
to an injunction (whether temporary or permanent), restraining order or such
other equitable relief (including the requirement to post bond) as a court of
competent jurisdiction may deem necessary or appropriate to restrain
Consultant from committing any violation of the covenants and obligations
contained in Sections 7, 8, 9 and 10 hereof. These injunctive remedies are
cumulative and in addition to any other rights and remedies the Company or
Xxxxxx Group or any such affiliate may have at law or in equity. Further,
Consultant represents that his experience and capabilities are such that the
provisions of Sections 7, 8, 9 and 10 hereof will not prevent him from earning
his livelihood.
12. Entire Agreement. Except as otherwise expressly provided herein,
this Agreement, the Exchange Agreement and the LLC Agreement constitute the
entire agreements among the parties hereto with respect to the subject matter
hereof, and all promises, representations, understandings, arrangements and
prior agreements relating to such subject matter (including those made to or
with Consultant or the Consulting Firm by any other person or entity) are
merged herein and superseded hereby.
13. Indemnification. The Company agrees that Consultant shall be an
"indemnified representative" for purpose of Article VII of the LLC Agreement.
14. Miscellaneous. (a) Binding Effect. This Agreement shall be
binding on and inure to the benefit of the Company, Xxxxxx Group and their
respective successors and permitted assigns. This Agreement shall also be
binding on and inure to the benefit of Consultant and his heirs, executors,
administrators and legal representatives. If Consultant's provision of Company
Services or Xxxxxx Services is terminated by reason of his death, all amounts
payable by the Company or Xxxxxx Group pursuant to Section 6(f)(ii) or 6(g)(i)
(or if Consultant shall die after the provision of all service hereunder has
terminated, any remaining amount payable by the Company pursuant to Section
6(f)(i)) shall be paid in accordance with the terms of this Agreement to
Consultant's devisee, legatee, or other designee or, if there be no such
designee, to his estate.
(b) Governing Law. (i)(A) THIS AGREEMENT (EXCEPT AS PROVIDED FOR IN
SECTION 14(b)(i)(B) BELOW) SHALL BE GOVERNED BY
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AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF ARKANSAS WITHOUT
REFERENCE TO PRINCIPLES OF CONFLICT OF LAWS THEREUNDER. SUBJECT TO SECTION
14(b)(i)(B), ANY AND ALL SUITS, LEGAL ACTIONS OR PROCEEDINGS AGAINST ANY PARTY
HERETO ARISING OUT OF THIS AGREEMENT SHALL BE BROUGHT IN ANY UNITED STATES
FEDERAL COURT SITTING IN THE STATE OF ARKANSAS OR ANY OTHER COURT OF
APPROPRIATE JURISDICTION SITTING IN THE STATE OF ARKANSAS, AS THE PARTY
BRINGING SUCH SUIT MAY ELECT IN ITS SOLE DISCRETION, AND EACH PARTY HEREBY
SUBMITS TO AND ACCEPTS THE EXCLUSIVE JURISDICTION OF SUCH COURTS FOR THE
PURPOSE OF SUCH SUIT, LEGAL ACTION OR PROCEEDING, EACH PARTY HERETO WAIVES
PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS AND AGREES THAT
SERVICE THEREOF MAY BE MADE BY CERTIFIED OR REGISTERED MAIL. EACH PARTY HERETO
HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO
THE LAYING OF VENUE OF ANY SUCH SUIT, LEGAL ACTION OR PROCEEDING IN ANY SUCH
COURT AND HEREBY FURTHER WAIVES ANY CLAIM THAT ANY SUCH SUIT, LEGAL ACTION OR
PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT
FORUM.
(B) NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS
AGREEMENT, THE PROVISIONS OF SECTIONS 7, 8, 9, 10 AND 11 SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE WITHOUT
REFERENCE TO PRINCIPLES OF CONFLICT OF LAWS THEREUNDER: ANY AND ALL SUITS,
LEGAL ACTIONS OR PROCEEDINGS AGAINST ANY PARTY HERETO ARISING OUT OF SECTIONS
7, 8, 9, 10 OR 11 HEREOF SHALL BE BROUGHT IN ANY UNITED STATES FEDERAL COURT
SITTING IN THE STATE OF DELAWARE OR ANY OTHER COURT OF APPROPRIATE
JURISDICTION SITTING IN THE STATE OF DELAWARE, AS THE PARTY BRINGING SUCH SUIT
MAY ELECT IN ITS SOLE DISCRETION, AND EACH PARTY HEREBY SUBMITS TO AND ACCEPTS
THE EXCLUSIVE JURISDICTION OF SUCH COURTS FOR THE PURPOSE OF SUCH SUIT, LEGAL
ACTION OR PROCEEDING, EACH PARTY HERETO WAIVES PERSONAL SERVICE OF ANY
SUMMONS, COMPLAINT OR OTHER PROCESS AND AGREES THAT SERVICE THEREOF MAY BE
MADE BY CERTIFIED OR REGISTERED MAIL. EACH PARTY HERETO HEREBY IRREVOCABLY
WAIVES ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE
OF ANY SUCH SUIT, LEGAL ACTION OR PROCEEDING IN ANY SUCH COURT AND HEREBY
FURTHER WAIVES ANY CLAIM THAT ANY SUCH SUIT, LEGAL ACTION OR PROCEEDING
BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
13
(ii) EACH PARTY HERETO ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY
WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND
DIFFICULT ISSUES, AND THEREFORE SUCH PARTY HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN
RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO
THIS AGREEMENT, OR THE BREACH, TERMINATION OR VALIDITY OF THIS AGREEMENT, OR
THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. EACH PARTY CERTIFIES AND
ACKNOWLEDGES THAT (W) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY
HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN
THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (X) EACH SUCH
PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (Y) EACH
SUCH PARTY MAKES THIS WAIVER VOLUNTARILY, AND (Z) EACH SUCH PARTY HAS BEEN
INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL
WAIVERS AND CERTIFICATIONS IN THIS SECTION 14(b).
(c) [RESERVED]
(d) Amendments. No provisions of this Agreement may be modified,
waived or discharged unless such modification, waiver or discharge is approved
by both the Company Board and the Xxxxxx Board or a person authorized thereby
and is agreed to in writing by Consultant, the consulting firm and such
officers or agents of the Company and Xxxxxx Group as may be specifically
designated by the Company Board and the Xxxxxx Board, as applicable. No waiver
by any party hereto at any time of any breach by any other party hereto of, or
compliance with, any condition or provision of this Agreement to be performed
by such other party shall be deemed a waiver of similar or dissimilar
provisions or conditions at the same or at any prior or subsequent time. No
waiver of any provision of this Agreement shall be implied from any course of
dealing between or among the parties hereto or from any failure by any party
hereto to assert its rights hereunder on any occasion or series of occasions.
No agreements or representations, oral or otherwise, express or implied, with
respect to the subject matter hereof have been made by either party which are
not set forth expressly in this Agreement.
(e) Severability. In the event that any one or more of the
provisions of this Agreement shall be or become invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of the
remaining provisions contained herein shall not be affected thereby.
14
(f) Notices. Any notice or other communication required or permitted
to be delivered under this Agreement shall be (i) in writing, (ii) delivered
personally, by nationally recognized overnight courier service or by certified
or registered mail, first- class postage prepaid and return receipt requested,
(iii) deemed to have been received on the date of delivery or on the third
business day after the mailing thereof, and (iv) addressed as follows (or to
such other address as the party entitled to notice shall hereafter designate
in accordance with the terms hereof):
(A) if to the Company, to it:
c/o Asbury Automotive Group L.L.C.
Xxx Xxxxx Xxxxxx
Xxxxx 0000
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
-and to-
Ripplewood Holdings L.L.C.
Xxx Xxxxxxxxxxx Xxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
(B) if to Consultant or the Consulting Firm, to him or it:
XxXxxxx Companies, Inc.
X.X. Xxx 00000
Xxxxxx Xxxx, XX 00000
Attention: Xxxxxx X. XxXxxxx, III
---------
Telephone:
Fax:
with a copy to:
Xxxxxx, Xxxxxxx & Xxxxxxxx
000 Xxxx Xxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxx Xxxx, XX 00000-0000
15
Attention: Xxxxx X. Xxxxxxx, Esq.
Telephone: (000) 000-0000
Fax: (000) 000-0000
Copies of any notices or other communications given under this Agreement shall
also be given to:
Debevoise & Xxxxxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxxxxxx, Xx., Esq.
Telephone: (000) 000-0000
Fax: (000) 000-0000
(g) Survival. In the event Consultant's provision of Company
Services but not Xxxxxx Services is terminated, Sections 1(b), 2(a), 2(b)(ii),
2(b)(iii), 2(b)(iv), 3(b), 4, 5(b), 6, 7, 8, 9, 10, 11, 12, 13 and 14 shall
survive the termination of the provision by Consultant of the Company
Services. In the event Consultant's provision of Xxxxxx Services but not
Company Services is terminated, Sections 1(a), 2(a), 2(b)(i), 2(b)(iii),
2(b)(iv), 3(a), 4, 5(a), 6, 7, 8, 9, 10, 11, 12, 13 and 14 shall survive the
termination of the provision by Consultant of the Xxxxxx Services. In the
event Consultant's provision of both Company Services and Xxxxxx Services is
terminated, Sections 7, 8, 9, 10, 11, 12, 13, 14 and, if Consultant's
provision of Company Services and Xxxxxx Services terminates in a manner
giving rise to a payment under Section 6(f), Section 6(f) shall survive the
termination of this Agreement and the termination of the provisions of such
services by Consultant.
(h) Counterparts. This Agreement may be executed in counterparts,
each of which shall be deemed an original and all of which together shall
constitute one and the same instrument.
(i) Headings. The section and other headings contained in this
Agreement are for the convenience of the parties only and are not intended to
be a part hereof or to affect the meaning or interpretation hereof.
(j) Consultant's Recusal. Consultant shall recuse himself from all
deliberations of the Company Board and its Managing Member and the Xxxxxx
Board regarding this Agreement, Consultant's provision of services hereunder
or related matters.
16
IN WITNESS WHEREOF, each of the Company, Xxxxxx Group and the
Consulting Firm has duly executed this Agreement by its authorized
representative and Consultant has hereunto set his hand, in each case
effective as of the date first above written.
XXXXXX AUTOMOTIVE ARKANSAS L.L.C.
By:
/s/ Xxxxx X. Xxxxxxxx
---------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: President & Chief Executive
Officer
XXXXXX AUTOMOTIVE GROUP L.L.C.
By:
---------------------------------
Name:
Title:
XxXXXXX COMPANIES, INC.
By:
---------------------------------
Name:
Title:
XXXXXX X. XxXXXXX, III, as Consultant
/s/ XXXXXX X. XxXXXXX, III
-------------------------------------
