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EXHIBIT 10.14
CSK AUTO, INC.
000 Xxxx Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
October 30, 1996
Investcorp International, Inc.
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
This will confirm the understanding and agreement (the "Agreement")
between Investcorp International, Inc. ("III") and CSK Auto, Inc. ("CSK Auto").
l. CSK Auto hereby engages III to render financial advisory services
concerning the acquisition of fifty-one percent of the stock
(the "Stock") of CSK Group, Ltd., the parent of CSK Auto, by the
parties listed on the attached schedule 1 (the "Purchasers").
2. XXX hereby accepts the engagement and, in that connection, agrees
to:
(a) conduct such financial review of CSK Group, Ltd. and its
business and operations as III shall deem appropriate and
feasible, which review shall be limited to an analysis of
(i) publicly available information with respect to CSK
Group, Ltd. and (ii) such other information as shall be
supplied to III by CSK Group, Ltd.;
(b) assist in negotiations and related acquisition strategy;
and
(c) advise with respect to executive compensation matters
regarding the executives of CSK Group, Ltd.
3. For purposes of this Agreement, "acquisition" shall mean any
transaction or series or combination of transactions, other than
in the ordinary course of trade or business, whereby, directly or
indirectly, control of or a material interest in CSK Group. Ltd.
or any of its businesses or assets is transferred to CSK Auto for
consideration, including, without limitation, a sale or exchange
of capital stock or assets, a lease of assets with or without a
purchase option, a merger or consolidation, a tender or exchange
offer, a leveraged buy-out, the formation of a joint venture or
partnership, or any similar transaction.
4. The term of III's engagement hereunder shall extend from the date
hereof through the later of June 25, 1997 or the closing of the
acquisition of the Stock. Subject to
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the provisions of paragraphs 5 through 10 hereof, which shall
survive any termination of this Agreement (including by operation
of the preceding sentence), CSK Auto may terminate III's
engagement hereunder at any time by giving III at least 10 days
prior written notice.
5. If an acquisition (as defined in paragraph 3 above) of CSK Group,
Ltd. occurs during the term of III's engagement hereunder, or at
any time during a period of 12 months following the effective
date of termination of III's engagement hereunder, regardless of
whether or not III rendered advice concerning the acquisition,
then CSK Auto shall pay the sum of $1.275 million to III at the
closing of the acquisition (which amount is equal to .6 percent
of the approximately $205 million total transaction amount).
6. CSK Auto shall reimburse III for its reasonable out-of-pocket
expenses incurred during the period of its engagement hereunder
with respect to the services to be rendered by it. Out-of-pocket
expenses shall include, but not be limited to, professional fees
and disbursements incurred by III.
7. CSK Auto shall:
(a) indemnify III and hold it harmless against any losses,
claims, damages or liabilities to which III may become
subject arising in any manner out of or in connection with
the rendering of services by III hereunder, unless it is
finally judicially determined that such losses, claims,
damages or liabilities arose primarily out of the gross
negligence or bad faith of III; and
(b) reimburse III immediately for any legal or other expenses
reasonably incurred by it in connection with
investigating, preparing to defend or defending any
lawsuits or other proceedings arising in any manner out of
or in connection with the rendering of services by III
hereunder; provided, however, that in the event a final
judicial determination is made to the effect specified in
subparagraph 7(a) above, III will remit to CSK Auto any
amounts reimbursed under this subparagraph 7(b). CSK Auto
agrees that (i) the indemnification and reimbursement
commitments set forth in this paragraph shall apply
whether or not III is a formal party to any such lawsuits,
claims or other proceedings, and (ii) III is entitled to
retain separate counsel of its choice in connection with
any of the matters to which such commitments relate, and
(iii) such commitments shall extend upon the terms set
forth in this paragraph to any controlling person,
director, officer, employee or agent of III; provided,
however, that to the extent that III retains separate
counsel in connection with any matter set forth in this
subparagraph 7(b), such counsel shall coordinate its
efforts with counsel to CSK Auto.
8. Except as contemplated by the terms hereof or as required by
applicable law, III shall keep confidential all material non-
public information provided to it by CSK
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Auto and shall not disclose such information to any third party,
other than such of its employees and advisors as III determines
to have a need to know.
9. Except as required (i) by applicable law or (ii) under the terms
of any agreement relating to the acquisition, any advice to be
provided by III under this Agreement shall not be disclosed
publicly or made available to third parties without the prior
approval of III, which approval shall not be unreasonably
withheld or delayed.
10. Subject to the terms of the Shareholders' Agreement among CSK
Auto and the purchasers named therein, to be entered into on the
date hereof, CSK Auto agrees that III has the right to place
advertisements in financial and other newspapers and journals at
its own expense describing its services to CSK Auto hereunder,
provided that III will submit a copy of any such advertisement to
CSK Auto for its approval, which approval shall not be
unreasonably withheld or delayed.
11. CSK Auto and III acknowledge and agree that there are no brokers,
representatives or other persons which have an interest in
compensation due to III from any transaction contemplated herein.
12. No amendment or waiver of any provision of this Agreement, or
consent to any departure by either party from any such provision,
shall in any event be effective unless the same shall be in
writing and signed by the parties to this Agreement and then such
amendment, waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given.
13. Any and all notices hereunder shall, in the absence of receipted
hand delivery, be deemed duly given when mailed, if the same
shall be sent by registered or certified mail, return receipt
requested, and the mailing date shall be deemed the date from
which all time periods pertaining to a date of notice shall run.
Notices shall be addressed to the parties at the following
addresses:
If to III, to:
Investcorp International, Inc.
000 Xxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxxxxx X. X'Xxxxx
with a copy to:
Xxxxxx, Xxxx & Xxxxxxxx
0000 Xxxxxxxxxxx Xxxxxx, X.X.
Suite 900
Washington, D.C. 20036
Attention: Xxxxx X. Xxxxxxxxx, Esq.
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If to CSK Auto, to:
CSK Auto, Inc..
000 Xxxx Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
Attn: President
with a copy to:
Xxxxxx, Xxxx & Xxxxxxxx LLP
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxx X. Xxxxxxx, Esq.
14. This letter agreement may be signed in one or more counterparts,
each of which shall constitute an original and which together
shall constitute one and the same agreement.
15. This letter agreement shall constitute the entire agreement
between the parties with respect to the subject matter hereof and
shall supersede all previous oral and written (and all
contemporaneous oral) negotiations, commitments, agreements and
understandings relating thereto.
16. This Agreement shall be construed and enforced in accordance with
the laws of New York and shall inure to the benefit of, and be
binding upon, III and CSK Auto, and their respective successors
and assigns.
17. The waiver by any party of any breach of this Agreement shall not
operate or be construed to be a waiver of any subsequent breach.
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If the foregoing correctly sets forth the Agreement between III and CSK
Auto, please so indicate in the space provided for that purpose below,
whereupon this letter shall constitute a binding agreement as of the date first
above written.
CSK AUTO, INC.
By: /s/ Xxxxx X. Xxxxxx
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Name: Xxxxx Xxxxxx
Title: President
AGREED:
INVESTCORP INTERNATIONAL, INC.
By: /s/ Xxxxx X. Xxxx
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Name
Title:
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