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EXHIBIT 10.13
MANAGEMENT CONSULTING AGREEMENT dated
as of January 4, 1996 between CTB, Inc., an
Indiana corporation (the "Company"), and
American Securities Capital Partners, L.P., a
Delaware limited partnership (the
"Consultant")
The Company desires to avail itself of the Consultant's
expertise and consequently has requested the Consultant to provide such
expertise, from time to time, in rendering certain management consulting and
advisory services related to the business and affairs of the Company and its
subsidiaries and the review and analysis of certain financial and other
transactions. The Consultant and the Company agree that it is in their
respective interests to enter into this 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 covenants
hereinafter set forth, the Company and the Consultant agree as follows;
SECTION 1. Retention of Consultant. The Company retains the
Consultant, and the Consultant accepts such retention, upon the terms and
conditions set forth in this Agreement.
SECTION 2. Term. This Agreement shall commence on January 4,
1996 and shall terminate on the earlier of (i) December 31, 2000 (the "Initial
Term") or (ii) the date upon which entities affiliated with the Consultant cease
to control on a fully-diluted basis directly or indirectly at least 20% of the
voting power of the Company. Upon the termination of the Initial Term and each
additional year thereafter, if any, for which this Agreement shall be extended
pursuant to this sentence, this Agreement shall automatically be extended for an
additional year unless notice to the contrary is given by either party at least
30 but no more than 60 days prior to such termination (the Initial Term and all
extensions thereof are collectively referred to as the "Term").
SECTION 3. Management Consulting Services. (a) The Consultant
shall advise the Company and its subsidiaries concerning such management matters
as relate to proposed financial transactions, acquisitions and other senior
management matters related to the Company's and its subsidiaries' business,
administration and policies, in each case as the Company shall reasonably and
specifically request by way of written notice to the Consultant, which notice
shall specify the services required of the Consultant and shall include all
background material necessary for the Consultant to complete such services. The
Consultant shall not be required to devote any specified amount
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of time to any such written request and shall be required to devote only so much
time to any such written 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 be free of domination or
control by the Company over the manner and time of rendering its services
hereunder, and the Company shall have no right to dictate or direct the details
of the services rendered hereunder. The Consultant shall (i) use its reasonable
effects 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 employee, agent
or representative of the Company and has no authority to act for or to bind the
Company without its prior written consent.
(c) This Agreement shall in no way prohibit the Consultant or
any partner or employee thereof from engaging in other activities, whether or
not competitive with any business of the Company.
SECTION 4. Compensation. (a) As consideration for the
Consultant's agreement to render the management consulting services set forth in
Section 3 of this Agreement and as compensation for any such services rendered
by the Consultant, the Company shall pay the Consultant an annual fee of
$300,000 in equal quarterly installments of $75,000 payable in advance on the
first day of each fiscal quarter (January 1, April 1, July 1 and October 1) (or,
if such date is not a business day in New York City, on the next business day in
New York City), with the first such installment to be payable on January 4,
1996.
(b) The Company (or, at the Company's option, any subsidiary
or affiliate thereof) shall, upon presentation by the Consultant to the Company
of such appropriate documentation as may be required by the Company, reimburse
the Consultant for all reasonable and necessary expenses and other disbursements
incurred by any and all partners, directors, officers, employees or agents of
the Consultant in the performance of its obligations hereunder.
(c) Nothing in this Agreement shall have the effect of
prohibiting the Consultant from receiving from the Company or its subsidiaries,
additional incentive or performance based compensation or, on a
transaction-by-transaction basis, a fee for financial advisory and consulting
services rendered by the Consultant to the Company or its subsidiaries in
connection with future acquisitions or dispositions by the Company or its
subsidiaries when so requested by the Company. As long as Xxxxx Xxxxxxx and J.
Xxxxxxxxxxx Xxxxxxx (together, the "Chocolas")
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collectively own at least 20% of the Company's outstanding common stock, the
Company shall not pay such compensation or fee without the Consent of one of the
Chocolas.
SECTION 5. Indemnification. The Company shall indemnify and
hold harmless the Consultant and its partners, directors, officers, employees,
agents and affiliates from and against any and all liabilities, costs, expenses
and disbursements (collectively, "Claims") of any kind with respect to or
arising from this Agreement or the performance by the Consultant of any services
in connection herewith. Notwithstanding the foregoing provision, the Company
shall not be liable for any Claim arising from the gross negligence or willful
misconduct of the Consultant.
SECTION 6. Notices. All notices, requests, consents and other
communications hereunder shall be in writing and shall be deemed sufficient if
personally delivered, or sent by nationally-recognized overnight courier, by
telecopy, or by registered or certified mail, return receipt requested and
postage prepaid, addressed as follows:
if to the Consultant:
American Securities Capital Partners, L.P.
000 Xxxx 00xx Xxxxxx
Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xx. Xxxxxxx X. Xxxxx
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
if to the Company:
CTB, Inc.
State Road 00 Xxxxx
Xxxx Xxxxxx Xxx 0000
Xxxxxxx, Xxxxxxx 00000-0000
Attention: J. Xxxxxxxxxxx Xxxxxxx
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
or to such other address as the party to whom notice is to be given may have
furnished to each other party in writing in accordance herewith. Any such notice
or communication shall be deemed to have been received (a) in the case of
personal delivery, on the date of such delivery, (b) in the case of
nationally-recognized overnight courier, on the next business day after the date
when sent, (c) in the case of telecopy transmission, when received, and (d) in
the case of mailing, on the third business day following that on which the piece
of mail containing such communication is posted.
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SECTION 7. Benefits of Agreement. This Agreement shall bind
and inure to the benefit of any successors to or assigns of the Consultant and
the Company; provided, however, that this Agreement may not be assigned by
either party hereto without the prior written consent of the other party.
SECTION 8. Governing Law. This Agreement shall be governed by
and construed and enforced in accordance with the laws of the State of Indiana
(without giving effect to principles of conflicts of laws).
SECTION 9. Headings. Section headings are used for convenience
only and shall in no way affect the construction of this Agreement.
SECTION 10. Entire Agreement; Amendments. This Agreement
contains the entire understanding of the parties with respect to its subject
matter and neither it nor any part of it may in any way be altered, amended,
extended, waived, discharged or terminated except by a written agreement signed
by each of the parties hereto.
SECTION 11. Counterparts. This Agreement may be executed in
counterparts, and each such counterpart shall be deemed to be an original
instrument, but all such counterparts together shall constitute but one
agreement.
SECTION 12. Waivers. Any party to this Agreement may, by
written notice to the other party, waive any provision of this Agreement. The
waiver by any party of a breach of any provision of this Agreement shall not
operate or be construed as a waiver of any subsequent breach.
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IN WITNESS WHEREOF, the parties have duly executed this
Management Consulting Agreement as of the date first above written.
CTB, INC.
By: /s/ J. Xxxxxxxxxxx Xxxxxxx
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Name: J. Xxxxxxxxxxx Xxxxxxx
Title: President and Chief Executive
Officer
AMERICAN SECURITIES CAPITAL
PARTNERS, L.P.
By its General Partner
AMERICAN SECURITIES CAPITAL
PARTNER GP CORP.
By: /s/ Xxxxxxx X. Xxxxx
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Name: Xxxxxxx X. Xxxxx
Title: President
CTB VENTURES, INC., as holder of all outstanding shares of
Common Stock of the Company, hereby consent to the execution and delivery by the
Company of the foregoing Agreement.
CTB VENTURES, INC.
By: /s/ Xxxxx Xxxxxx
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Name: Xxxxx Xxxxxx
Title: Vice President
