Exhibit 10.3
Execution
Copy
_______________________________
Management Services
Agreement
_______________________________
RICHLAND, GORDON & COMPANY
9330 Sears Tower
233 South Wacker Drive
Chicago, IL 60093
April 29, 2009
Atlantica, Inc.
c/o Richland, Gordon &
Company
9330 Sears Tower
233 South Wacker Drive
Chicago, IL 60093
Ladies and Gentlemen:
This letter agreement sets forth the
terms and conditions on which Richland, Gordon & Company (the
“Manager” ) will provide Atlantica, Inc. (the
“Company” ) with certain financial and
management consulting services.
Accordingly, we have agreed as
follows:
1.
Definitions .
(a)
“Claims”
is defined in Section 9.
(b)
“Company”
is defined in the first paragraph of this
agreement.
(c)
“Consulting
Event” is defined in
Section 3.
(d)
“EBITDA”
means, for any period, the sum of the
amounts for such period of (i) the net income (or loss) after taxes
of the Company and its direct and indirect subsidiaries on a
consolidated basis, plus (ii) interest expense which has
been deducted in the determination of the net income (or loss)
after taxes of the Company and its direct and indirect subsidiaries
on a consolidated basis, plus (iii) federal, state and local
taxes which have been deducted in determining the net income (or
loss) after taxes of the Company and its direct and indirect
subsidiaries on a consolidated basis, plus (iv) depreciation
and amortization expenses which have been deducted in determining
the net income (or loss) after taxes of the Company and its direct
and indirect subsidiaries on a consolidated basis, plus
(v) extraordinary losses which have been deducted in the
determination of the net income (or loss) after taxes of the
Company and its direct and indirect subsidiaries on a consolidated
basis, plus (vi) all other non-cash charges, minus
(viii) extraordinary gains which have been included in the
determination of the net income
(or loss) after taxes of the Company and
its direct and indirect subsidiaries on a consolidated basis.
Each item used in calculating EBITDA shall be determined in
accordance with generally accepted accounting principles,
consistent with that used in prior periods.
(e)
“Initial
Acquisition” means the
consummation by the Company of its initial acquisition (whether
directly or indirectly, in any form, including through any of its
subsidiaries) of, or other business combination with, any company
or business occurring following the date hereof.
(f)
“Initial
Financing” means the
consummation by the Company of its initial debt or equity financing
(whether directly or indirectly, in any form, including through any
of its subsidiaries) occurring following the date hereof, but shall
not include any loan made by Mirabella Holdings, LLC to the Company
pursuant to the Demand Promissory Note issued on the date
hereof.
(g)
“Initial
Transaction” means the
first to occur following the date hereof of the Initial Acquisition
or the Initial Financing.
(h)
“Liabilities”
is defined in Section 8.
(i)
“Management
Fee” is defined in
Section 3.
(j)
“Manager”
is defined in the first paragraph of this
agreement.
(k)
“Manager
Indemnitees” is defined
in Section 8.
2.
Services . The Manager will provide the Company and its
direct and indirect subsidiaries with management and consulting
services regarding the business of the Company and its direct and
indirect subsidiaries and such other services relating to the
Company and its direct and indirect subsidiaries as may from time
to time be reasonably requested by the Board of Directors or
executive officers of the Company. Without limiting the
generality of the foregoing, the parties currently contemplate that
these services shall include advice regarding improvements to the
Company’s financial reporting, accounting and management
information systems and staffing, advice regarding the
Company’s general preparation for any Initial Transaction,
and advice regarding the Company’s execution of an Initial
Transaction, if any. The Manager shall devote only so much
time, and shall consult with and advise the officers and managers
of the Company only to such extent and at such times and places as
may be mutually convenient to the Company and the
Manager.
3.
Compensation and Expenses
.
(a)
For the services to be rendered by the
Manager hereunder, the Manager shall receive an annual fee (the
“Management Fee” ) equal to the greater of (i)
$120,000 and (ii) 5% of EBITDA, computed without taking into
consideration the fees payable under this Section 3, as determined
by the Company’s regular auditors, or in the absence thereof,
by the Company’s Board of Directors, with respect to each
fiscal year. The Company shall pay the Management Fee in
quarterly installments in arrears, on April 15, July 15, October 15
and January 15 of each year with respect to the immediately
preceding calendar quarter, equal to the greater of (i)
-2-
$30,000 and (ii) 5% of EBITDA for the
immediately preceding calendar quarter, commencing with respect to
the calendar quarter ended March 31, 2008 (it being acknowledged
and agreed by the parties that the Manager has been providing to
the Company the services to be rendered hereunder since January 1,
2008), computed without taking into consideration the fees payable
under this Section 3; provided , however , that all
Management Fees earned by the Manager prior to the Initial
Transaction shall accrue and not be paid to the Manager until the
consummation of the Initial Transaction. For purposes of
determining the amount of the Management Fee payable to the Manager
with respect to any calendar quarter, the Company’s Board of
Directors may, at the time, make a reasonable good faith estimate
of EBITDA with respect to such calendar quarter. Without
limiting the foregoing, at the end of each fiscal year during the
term of this agreement, the parties shall make appropriate
adjustment to the aggregate amount of the Management Fee paid to
date to the Manager with respect to such prior fiscal year based on
any adjustments made to the calculation of EBITDA with respect to
such prior fiscal year as a result of the audit of
