Exhibit 10.3
Page 1 of 11
CONFIDENTIAL TREATMENT REQUEST
[ * ] INDICATES INFORMATION THAT HAS BEEN
OMITTED PURSUANT TO A CONFIDENTIAL TREATMENT
REQUEST AND THIS INFORMATION HAS BEEN FILED
UNDER SEPARATE COVER WITH THE COMMISSION.
AGREEMENT BETWEEN
MIDNIGHT AUTO FRANCHISE CORPORATION
AND
ASSOCIATION OF AUTOMOTIVE AFTERMARKET DISTRIBUTORS
This agreement made
and entered into as of the 5th day of August, 2004, by and
between Midnight Auto Franchise Corporation (hereinafter referred
to as "MAFC"),
a Michigan corporation
with principal
offices at 3872
Rochester Road,
Troy,
Michigan 48083
and ASSOCIATION OF AUTOMOTIVE AFTERMARKET DISTRIBUTORS
(hereinafter referred
to as "AAAD"), an
Illinois corporation
with principal
offices at 5050 POPLAR AVENUE, SUITE 2020, Memphis, Tennessee.
WITNESSETH:
WHEREAS, "MAFC" is
engaged in providing
automotive parts and
services to
the motoring
public at numerous All
Night Auto Service
Centers (hereinafter
referred to as ANAs) located throughout the United States, and
WHEREAS, "MAFC"
desires to obtain a unified principal source of supply for
its ANAs, and
WHEREAS, AAAD is an association of automotive parts warehouse
distributors
(hereinafter referred
to as "AAAD Members")
who are capable and desirous of
supplying to "MAFC" the automotive replacement and repair parts
required by the
ANAs.
NOW,
THEREFORE,
in consideration of
the premises and the mutual covenants
and conditions contained herein, "MAFC" and AAAD agree as
follows:
1. SCOPE AND
COVERAGE.
A.
AAAD and "MFAC" agree that the participating AAAD Members (as
hereinafter defined)
shall be the principal suppliers to the designated ANAS of
at least [*]% of their
automotive inventory
replacement
and repair parts,
as
defined below, on the
terms and conditions set forth herein or as may hereafter
be agreed to by and between AAAD or the AAAD Members and "MAFC".
This Agreement
will apply to all ANAs
in the United
States except as specified herein or
otherwise mutually
agreed. A participating AAAD Member is defined as a
current
member of AAAD in good standing. AAAD will act in behalf of those
participating
AAAD members as their billing and information disseminating agent and will act
to provide general
management and
coordination of the
supply program.
Monies
paid to AAAD by "MAFC" and the accounts receivable for unpaid merchandise are
the property of and are owed to the individual AAAD Members who
sold the goods.
B.
The automotive
inventory replacement and repair parts to be
supplied
hereunder include,
but are not limited to, ignition parts, brake parts,
front-end and other chassis parts, spark plugs, light bulbs and
other electrical
parts, filters,
fan belts,
hoses and hose clamps,
thermostats,
water pumps,
windshield wiper parts, tire repair parts, wheel weights, and
cooling system and
fuel line chemicals.
Products to be
supplied hereunder
shall be obtained from
sources whose quality is acceptable to "MAFC".
* Portions
of this exhibit have been omitted and filed separately pursuant
to
an
application for
confidential
treatment filed with the Securities and
Exchange Commission
pursuant to Rule 24b-2
under the Securities
Exchange
Act
of 1934, as amended.
<PAGE>
Page
2 of 11
C.
AAAD agrees to obtain the separate written agreement of each
participating AAAD Member, which agreement shall specify the
ANAs designated to
be supplied by that
AAAD Member,
shall acknowledge the participating AAAD
Member's
responsibility to AAAD and "MAFC" for its faithful performance of and
compliance with this
Agreement with respect to those ANAs, and shall commit the
participating AAAD
Member to continue its faithful performance and compliance
with the AAAD Agreement with "MAFC" (except for central billing and
coordination) with
respect to those ANAs in the event AAAD ceases to exist as a
business entity or is
legally or financially
unable to operate as a
business.
Thereafter, "MAFC" may
change its designation of ANAs to be supplied by a
participating AAAD
Member with one (1) month's written notice prior to any
change.
D.
Mutually acceptable terms and conditions regarding billings, delivery,
inventory coverage and management, and similar administrative matters will be
set forth in Exhibits
to this Agreement which will be modified by written
agreement of the
parties to permit
changes that may be
required by market and
administrative conditions. Exhibits attached hereto, or any
amendment thereof in
accordance with the terms of this Agreement, is incorporated herein
by reference
and is made a part of this Agreement.
2. TERMINATION
AND MODIFICATION.
A.
This Agreement
shall remain in full force and effect
for [*] from the
signature date hereof unless earlier terminated or cancelled by AAAD or
"MAFC".
This agreement will
automatically renew as
written on each anniversary date of
its inception unless either AAAD or "MAFC" decide otherwise.
B.
In the event of termination by "MAFC", "MAFC" shall provide AAAD
ninety
(90) days prior written notice of intent to terminate and cancel.
As of the date
such notice is
provided to AAAD, all terms in this contract will remain in
effect until thirty (30) days prior to the actual cancellation of the contract.
"MAFC" will take
control of
inventory during the thirty (30) days prior to
actual cancellation of the contract.
C.
"MAFC" shall have the option of terminating this Agreement as it
applies
to an individual AAAD Member with written notice of a probationary
period of 30
days, in event of a
breach, followed by a
termination
notice to AAAD and
the
AAAD Member if the breach is not cured during the probationary
period. The terms
and other provisions of cancellation of the contract will apply to the
individual AAAD Member.
D.
In the event of
termination by AAAD,
AAAD shall provide
"MAFC" 90 day
prior written
notice of intent to
terminate and cancel. "MAFC" may assume
responsibility for
inventory control at
any time it desires
during the 90 day
notice period by giving AAAD written notice of its intention to assume
control
of inventories.
Effective with the month MNA takes control of inventory,
terms
to "MAFC" will be 10th prox.
<PAGE>
Page 3 of 11
E.
This Agreement or any
of the Exhibits made a part hereof may be amended
or modified only by a written agreement executed by AAAD and
"MAFC". The laws of
the State of Illinois
hereunder shall
govern this
Agreement and any dispute
arising. If any
provisions
hereof shall be found to be unenforceable, the
remaining portions of the Agreement shall remain in full force and
effect.
IN WITNESS HEREOF the parties have executed this Agreement.
MIDNIGHT AUTO FRANCHISE CORP.
By /s/ (illegible)
Date 8/12/04
-------------------
-------
President, Nicholas Cocco
Attest /s/ (illegible)
Date 8/12/04
----------------
-------
Title Project Manager
---------------
ASSOCIATION OF AUTOMOTIVE AFTERMARKET DISTRIBUTORS
By /s/ (illegible)
Date 8/10/04
------------------
-------
Alan Bostwick, Executive Vice President
Attest /s/ (illegible)
Date 8/10/04
