CORPORATE DEVELOPMENT AND
ADMINISTRATIVE SERVICES AGREEMENT
This Corporate Development and Administrative Services Agreement,
dated as of May 29, 1998, is entered into between Brentwood Private Equity LLC,
a Delaware limited liability company ("BPE") and City Truck and Trailer Parts,
Inc., an Alabama corporation (the "Company"). For and in consideration of the
covenants and agreements contained herein, the parties hereto hereby agree as
follows:
1. SERVICES AND RESOURCES.
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(a) BPE will assist materially in the corporate development activities of
the Company and contribute to the administration of the business growth efforts
of Company by providing the following services to Company:
(i) assistance in analyzing, structuring and negotiating the terms of
investments and acquisitions;
(ii) researching, identifying, contacting, meeting and negotiating with
prospective sources of debt and equity financing;
(iii) preparing, coordinating and conducting presentations to prospective
sources of debt and equity financing;
(iv) assistance in structuring and establishing the terms of debt and
equity financing; and
(v) assistance and advice in connection with the preparation of Company's
financial and operating plans.
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(b) In rendering the services described above, BPE may do, or cause others
to do, all things that in the good faith judgment of BPE are necessary, proper
or desirable to discharge the aforementioned duties and responsibilities,
including, without limitation, employing the services of any other person or
persons (including administrative and support services personnel of other
entities associated with BPE) and paying to any such other person or persons
such amounts as BPE may deem reasonable and appropriate in the circumstances and
as may be approved by Company from time to time.
2. REIMBURSEMENT AND COMPENSATION.
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(a) Reimbursement. As partial consideration for the services to be
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provided pursuant to Section 1 hereof, Company agrees that it shall pay to BPE
or another party designated by BPE, in reimbursement of fees and expenses
incurred or advanced by or on behalf of BPE or any persons or entities
associated with BPE (collectively, the "Brentwood Entities"), the following:
(i) all travel and reasonable fees and expenses incurred from time to time
in performing the services described in Section 1 hereof;
(ii) all reasonable fees and costs of legal counsel and accountants and all
reasonable out-of-pocket expenses incurred in connection with the Brentwood
Entities' investment in Company, including, without limitation, all reasonable
fees and expenses incurred with respect to (A) the formation, organization and
initial capitalization of the Company and (B) the negotiation, documentation and
consummation of those matters described in clause (A) of this paragraph (ii),
including the negotiation and preparation of this Agreement;
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(iii) all reasonable fees and expenses (recurring and nonrecurring)
incurred hereinafter in connection with all investments of the Brentwood
Entities in the Company, including, without limitation, all reasonable fees and
expenses incurred with respect to (A) requested waivers of any rights of any
Brentwood Entity or Brentwood Entities' investors (collectively, the " Brentwood
Investors") relating to, or the consent of any Brentwood Investor to,
contemplated acts of Company (whether or not granted or obtained), (B)
preparation and distribution to Brentwood Investors of financial statements, tax
returns and other information or reports relating to such Brentwood Investors'
interests in the Company (including the reasonable fees and costs of accountants
and other experts incurred in connection therewith) and (C) customary
maintenance and monitoring activities associated with the Brentwood Investors'
interests in Company; and
(iv) all reasonable fees and expenses (recurring and nonrecurring)
incurred hereafter in connection with (A) any direct or indirect contribution of
capital to, investment in or financing of Company by any Brentwood Investor, (B)
any sale, distribution or other transfer of, or any alteration of, any direct or
indirect Company interest of any Brentwood Investor, including, without
limitation, the sale of all or a part of the business or assets of Company or
the merger, consolidation or recapitalization of Company, and (C) compliance
with all applicable Federal, state and local laws, rules and regulations with
respect to the matters described in paragraphs (i) through (iii) above and in
this paragraph (iv).
Company shall reimburse to BPE all amounts pursuant to this Section
2.1 in cash promptly upon receipt of a written statement setting forth in
reasonable detail the fees and expenses for which BPE is seeking reimbursement.
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(b) Compensation. As partial consideration for the services to be provided
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pursuant to Section 1 hereof, Company shall pay to BPE, or another party
designated by BPE, a monitoring fee (the "Monitoring Fee") from the "Monitoring
Fee Commencement Date" through the last day of the term of this Agreement. The
"Monitoring Fee Commencement Date" will be the earlier of (i) the date on which
95% of the aggregate amount committed to be invested by the partners of
Brentwood Associates Buyout Fund II, L.P. (the "Fund") has been invested by the
Fund or (ii) January 3, 2001. The amount of the Monitoring Fee shall be an
amount equal to one percent (1%) per annum of the aggregate amount of debt and
equity investment of or by Brentwood Investors in Company. The Monitoring Fee
shall be payable semiannually in advance (i) on or before January 10 of each
year with respect to the half year beginning on January 1 of such year and (ii)
on or before July 10 of each year with respect to the half year beginning on
July 1 of such year. The Monitoring Fee for any partial period shall be
prorated on the basis of the ratio that the total number of days in the half
year during which the obligation to pay the Monitoring Fee is effective under
this Agreement bears to 182. To the extent that any portion of the Monitoring
Fee for the final half year has been prepaid but has not been earned, BPE shall
cause the unearned portion (determined by the method set forth in the
immediately preceding sentence) of such payment to be refunded to Company.
Subject only to the immediately preceding sentence, all amounts paid under this
Section 2.2 shall be nonrefundable. The initial semiannual Monitoring Fee to be
paid pursuant to this Section 2.2 shall be calculated based upon the aggregate
amount of debt and equity investment of or by Brentwood Investors outstanding on
the Monitoring Fee Commencement Date, and thereafter such semiannual payments
shall be calculated based upon the average of the aggregate amounts of such debt
and
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equity outstanding during each of the six months of the immediately preceding
half year payment period.
(c) As partial compensation for the financial advisory services to be
provided pursuant to Section 1 hereof, Company shall pay to BPE, or another
party designated by BPE, an advisory fee equal to one and one-half percent (1
1/2%) of the aggregate amount of all capital investments (excluding maintenance
capital investments in existing facilities or equipment of the Company and its
subsidiaries solely for the general upkeep and repair of those facilities and
equipment) made by the Company and of all amounts paid by the Company in
connection with any acquisitions. Such fee shall be payable concurrently with
the making of any such investment or the closing of any such acquisition.
3. GENERAL.
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This Agreement (i) constitutes the entire agreement and supersedes all
other prior and contemporaneous agreements and undertakings both written and
oral, among the parties hereto with regard to the specific subject matter
hereof; (ii) is not intended to confer upon any person any rights or remedies
hereunder or with respect to the subject matter hereof except as specifically
provided in this Agreement; (iii) shall not be assigned by operation of law or
otherwise; (iv) may be executed in two or more counterparts, each of which shall
be deemed to be an original, but all such counterparts shall together constitute
a single agreement; and (v) may be amended only by a written instrument executed
by or on behalf of the parties hereto.
4. CONSTRUCTION.
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All Section and paragraph titles or captions contained in this
Agreement are for convenience of reference only and shall not affect the meaning
or interpretation of any provision
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of this Agreement. All terms used in this Agreement include, where appropriate,
the singular as well as the plural and the masculine, feminine and neuter
genders. The words "herein", "hereof" and "hereunder", and other words of
similar import, refer to this Agreement as a whole and not to any particular
Section, paragraph or other subdivision; and all Section, paragraph and other
subdivision references contained herein refer to Sections, paragraphs and other
subdivisions hereof unless another agreement or instrument is specifically
referenced. Use herein of the term "or" is not intended to be exclusive, unless
the context clearly requires. All provisions hereof apply to successive events
and transactions. Time is of the essence for each and every term and condition
of this Agreement in which time is a factor.
5. SEVERABILITY.
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If any term or provision of this Agreement or the application thereof
to any circumstance shall, in any jurisdiction and to any extent, be invalid or
unenforceable, such term or provision shall be ineffective as to such
jurisdiction to the extent of such invalidity or unenforceability without
invalidating or rendering unenforceable the remaining terms and provisions of
this Agreement or the application of such terms and provisions to circumstances
other than those as to which it is held invalid or enforceable.
6. TERM.
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This Agreement shall terminate upon the first to occur of (i) the date
of termination of this Agreement set forth in a written instrument executed by
the parties hereto expressly terminating this Agreement and (ii) the first to
occur of (A) the closing of an acquisition of Company through an asset purchase,
merger or sale of 80% (in value) or more of
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the outstanding equity securities of Company in which the consideration is all
cash or (B) the final distribution in liquidation of Company following the
dissolution of Company.
7. CHOICE OF LAW.
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This Agreement shall be governed by and construed in accordance with
the internal laws, and not the laws of conflicts of laws, of the State of
Delaware. Each of the parties to this Agreement hereby irrevocably and
unconditionally (i) agrees to be subject to, and hereby consents and submits to,
the jurisdiction of the courts of the State of Delaware and of the federal
courts sitting in the State of Delaware, (ii) to the extent such party is not
otherwise subject to service of process in the State of Delaware, hereby
appoints The Corporation Trust Company, 0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx
00000, as such party's agent in the State of Delaware for acceptance of legal
process and (iii) agrees that service made on such agent shall have the same
legal force and effect as if served upon such party personally within the State
of Delaware.
[Signature Page to Follow]
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IN WITNESS WHEREOF, each of the parties hereto has executed this
Agreement with the intent to be legally bound, all as of the date first above
set forth.
CITY TRUCK AND TRAILER PARTS, INC.
By:/s/ Xxxxxxx X. Xxxxxxx
________________________________
Xxxxxxx X. Xxxxxxx
President
BRENTWOOD PRIVATE EQUITY LLC
By:/s/ Xxxxxxxxxxx X. Xxxxxxxx
________________________________
Xxxxxxxxxxx X. Xxxxxxxx
Managing Member
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