Exhibit 10.32
HMK ENTERPRISES, INC.
800 SOUTH STREET, SUITE 355
WALTHAM, MA 02154
TELEPHONE: (617) 891-6660
FAX: (617) 891-9712
December 5, 1997
Mr. Robert W. Ackerman
President and Chief Executive Officer
Sheffield Steel Corporation
220 N. Jefferson Street
Sand Springs, OK 74063
Dear Bob:
This letter confirms the agreement under which we will provide management
consulting services to your company from the period commencing December 5, 1997,
and continuing until either of us shall give the other not less than 180 days
prior written notice of termination of this agreement. This agreement supersedes
and amends any and all prior management consulting agreements between us and
your company and/or any of its subsidiaries.
1. SERVICES PROVIDED:
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We shall provide management and business consulting services as you may
reasonably request from time to time including, but not limited to, the
following:
(a) Financial and accounting management services including, for
example: the establishment and monitoring of systems for cash management,
budgeting and internal controls; establishment, "hands-on" involvement
with, and supervision of, relationships with banks and other key financial
institutions;
(b) Marketing services including, for example, development and
monitoring of marketing, advertising and selling programs and strategies;
periodic reviews and analysis of sales results;
(c) Executive personnel services including for example, interviewing
potential employees, staffing recommendations, development of job
descriptions, performance evaluations and compensation analysis and
recommendations;
(d) Analysis and recommendations with respect to data processing
systems and services;
(e) Corporate development services including analysis of contemplated
acquisitions and divestitures and direct involvement in negotiation with
respect to acquisitions and divestitures;
(f) Contract administration, limited legal services, assistance in the
selection of outside counsel and coordination and monitoring of work
performed by outside counsel;
(g) Representation and assistance in the audit process and the
coordination of the general accounting function so as to optimize the
company's position in tax matters, etc.; and
(h) Consultation and assistance in setting up and maintaining deferred
compensation, pension, profit sharing and other human resource related
programs.
In connection with the foregoing, we agree to serve your company faithfully and
to the best of our ability in order to promote the best business interests of
your company.
2. PERFORMANCE OF SERVICES:
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We shall perform the above services using highly-trained personnel who are
either full-time on our payroll or engaged by us as consultants at our expense,
unless otherwise agreed. The extent to which your company will utilize our
services will be subject to your sole discretion and we will devote as much time
and attention to your business needs as your company deems necessary. However,
your company agrees to provide reasonable notice of the services which it may
require outside the normal course of business expectation. It is contemplated
that our personnel will not have a permanent office at your facilities. As part
of our services hereunder, at your request, and without additional charge, our
personnel will serve as officers or directors of your company, provided that
your corporate documents or the law of your state of incorporation contain
indemnification provisions satisfactory to us and that your company provides
acceptable directors and officers liability insurance coverage for such
individuals.
3. COMPENSATION:
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As full compensation for all of our services hereunder, you shall pay us,
on a monthly basis, a fee of one-half of 1% of your company's consolidated
sales..
In addition to the foregoing, you shall pay or promptly reimburse us for
the cost of all travel, entertainment, telephone, and other expenses incurred by
our personnel in the performance of services hereunder, and you shall make
available to us, without charge, at your facilities, suitable office space and
related secretarial and administrative support services as shall reasonably be
required in connection with the performance of services for you hereunder. Also,
as part of our compensation hereunder, you agree that all of the employees and
directors (and their immediate families) of HMK Enterprises, Inc. and its
wholly-owned insurance services subsidiary, Risk Management Solutions, Inc.,
will be covered under your group health insurance plan, and you will be
responsible for administering, adjusting, and paying all claims by such
employees and directors (and their immediate families) under such health
insurance plan, without any cost or charge-back to, or reimbursement from, us.
4. CORPORATE DEVELOPMENT.
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Our staff includes personnel who are engaged in the development,
investigation and
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negotiation of acquisition opportunities. We shall, as part of our services
hereunder, bring to the attention of your company, acquisition opportunities
which we believe would be suitable for your company, and assist your company's
evaluation, negotiation and execution thereof.
5. MISCELLANEOUS.
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This agreement constitutes the entire agreement between us with respect to
the subject matter and cannot be changed except by a writing signed by both of
us. It shall be governed by and construed under that laws of the Commonwealth of
Massachusetts.
If you agree with the foregoing, please sign below whereupon this shall become a
binding agreement between us.
AGREED: Very truly yours,
SHEFFIELD STEEL CORPORATION HMK ENTERPRISES, INC.
By: /s/ Robert W. Ackerman By: /s/ Steven E. Karol
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Robert W. Ackerman Steven E. Karol
President and Chief President and Chief
Executive Officer Executive Officer
Date: December 5, 1997 Date: December 5, 1997
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