Exhibit
10.13


 


EXECUTION
VERSION


 


MANAGEMENT
AGREEMENT


 


MANAGEMENT AGREEMENT,
dated as of September 1, 2005, by and among Gary L. Wilson (“GW”), Alfred
D. Boyer (“AB”), Robert Day (“RD” and, together with GW and AB, the
“Manager”), One Equity Partners LLC (“OEP”) and Progress Rail
Services Parent Corp., a Delaware corporation (“Parent”).


 


WHEREAS,
OEP entered into a Management Agreement, dated as of March 24, 2005 (as
such agreement may be amended, modified or restated from time to time, the “OEP Management Agreement”),
whereby OEP agreed to provide Parent and the direct or indirect
subsidiaries of Parent (individually, a “Subsidiary” and, collectively,
the “Subsidiaries”; and, together with Parent, the “Company”) with certain services as forth therein and whereby
such services may be provided by OEP arranging for and coordinating
services of other professionals, experts and consultants (the “Subcontract
Right”); and


 


WHEREAS, in accordance
with OEP’s Subcontract Right, OEP and Parent desire that the Manager provide
Parent with certain services as set forth herein (the “Services”), and
the Manager desires to render such services to Parent in consideration of a
management fee as specified herein.


 


NOW, THEREFORE, in
consideration of the mutual covenants and agreements set forth herein and for
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties hereto agree as follows:


 


1.             SERVICES.


 


1.1           Services. At OEP’s
request, the Manager shall provide Services to the Company. Such Services shall
consist of, assisting OEP in (a) identifying other companies for potential
acquisitions (the “Target Companies”), (b) reviewing and evaluating
potential investments in Target Companies, and (c) structuring and
negotiating the terms of investments in Target Companies; provided, however,
that in no event shall the Manager be deemed to be managing the investments of
the Company or OEP or an investment advisor to the Company or OEP and the
Manager shall not be required to take any action inconsistent with this
proviso.


 


1.2           Independent
Contractor. Notwithstanding the Services requested,
provided or to be provided hereunder, the Manager shall be deemed to be an
independent contractor and, unless otherwise expressly authorized or provided,
shall not be authorized to manage the affairs of, act in the name of, or bind OEP
or the Company pursuant to this Agreement. The Manager is not, and shall not be
considered, a partner of OEP or the Company and the parties do not intend that
this Agreement, separately or in conjunction with any other document, create
any joint venture or partnership. Neither OEP nor the Company shall not be
obligated to follow or accept any recommendation made by the Manager. The
management, policies and operations of the Company and OEP shall be the
responsibility of the Company and OEP, respectively.


 


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2.             COMPENSATION FOR SERVICES; REIMBURSEMENT.


 


2.1           Service Fee. Parent
shall pay directly to BDW Management LLC, on behalf of the Manager, a service
fee in United States dollars (the “Service Fee”) equal to the Manager’s “pro
rata” portion of any service fee paid by Parent to OEP pursuant to Section 3.1
of the OEP Management Agreement without giving effect to Section 2.3 hereof (the
“OEP Service Fee”) for each 12-month period during the term of this
Agreement, payable in advance and in equal quarterly installments during the
term of this Agreement, on the first day of each February, May, August and
November (each such date, a “Payment Date”) commencing May 1, 2005. For
purposes of this Agreement with respect to any Payment Date, the Manager’s “pro
rata” portion of the OEP Service Fee means such OEP Service Fee multiplied
by a fraction, the numerator of which is the number of shares of common
stock, par value $0.01 per share (“Common Stock”), of Parent owned in
the aggregate by the Manager and their respective Permitted Transferees (as
defined in the Amended and Restated Stockholders’ Agreement, dated as of September
1, 2005 (the “Stockholders’ Agreement”) as of the date three business
days prior to such Payment Date and the denominator of which is the number of
Shares owned in the aggregate by the OEP Stockholders (as defined in the
Stockholders’ Agreement) and their respective Permitted Transferees as of the
date three business days prior to such Payment Date plus the number of
Shares owned in the aggregate by the Manager and their respective Permitted
Transferees as of the date three business days prior to such Payment Date. To
the extent any Service Fee is not paid it will accrue until paid. If on any day
on which the Service Fee is due is not a business day, the Service Fee shall be
due on the next succeeding business day.


 


2.2           Other
Transaction Fees. In connection with any acquisition of any business
(whether by merger, stock acquisition, asset acquisition or otherwise) by
Parent or any Subsidiary (an “Acquisition Transaction”) or any sale of
Parent or any Subsidiary or any business thereof (whether by merger, stock
acquisition, asset acquisition or otherwise) (a “Sale Transaction”),
Parent shall pay a transaction fee in United States dollars (the “Transaction
Fee”) to BDW Management LLC, on behalf of the Manager, equal to the Manager’s
“pro rata” portion of any such transaction fee payable by Parent to OEP
pursuant to Section 4.2 of the OEP Management Agreement without giving effect
to Section 2.3 hereof (the “OEP Transaction Fee”) payable in full to Boyer
Capital Management, on behalf of the Manager, upon the closing of each such
Acquisition Transaction or Sale Transaction. For purposes of this Agreement,
the Manager’s “pro rata” portion of the OEP Transaction Fee means such OEP Transaction
Fee multiplied by a fraction, the numerator of which is the number of
shares of Common Stock of Parent owned in the aggregate by the Manager and their
respective Permitted Transferees as of the date three business days prior to
the closing of such Acquisition Transaction or Sale Transaction and the
denominator of which is the number of Shares owned in the aggregate by the OEP
Stockholders and their respective Permitted Transferees as of the date three
business days prior to the closing of such Acquisition Transaction or Sale
Transaction plus the number of Shares owned in the aggregate by the
Manager and their respective Permitted Transferees as of the date three
business days prior to the closing of such Acquisition Transaction or Sale
Transaction.


 


2.3           Reduction
of Fees to OEP. The OEP Service Fees and OEP Transaction Fees payable shall
be reduced by the amount of Service Fees and Transaction Fees payable
hereunder, respectively.


 


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2.4           Reimbursement.
In addition to the fees payable pursuant to Sections 2.1 and 2.2, Parent shall
reimburse the Manager promptly on demand for any reasonable expenses incurred
by the Manager in connection with providing any Services specifically requested
to be performed hereunder.


 


3.             LIABILITY AND INDEMNIFICATION.


 


3.1           Liability
of Indemnified Persons. Neither the Manager nor any of its affiliates nor
any stockholder, member, director, partner, officer, employee, agent,
representative or affiliate of any of the foregoing (collectively, “Indemnified
Persons”) shall be liable to the Company, any subsidiary of the Company,
any Target Company or any of their respective affiliates for any claims,
damages, losses, expenses or liabilities of any nature whatsoever, including,
but not limited to, legal fees and expenses (collectively, “Losses”), to
which such Indemnified Person may become subject in connection with or arising
out of or related to this Agreement, including, without limitation, by reason
of any act or omission in connection with Services, unless and to the extent it
is determined by a final decision (after all appeals and the expiration of time
to appeal) of a court of competent jurisdiction that such Losses resulted from
the fraud or gross negligence of such Indemnified Person. Each Indemnified
Person shall be entitled to rely in good faith on the advice of counsel, public
accountants or other independent persons experienced in the matter at issue,
and any act or omission of any Indemnified Person in reasonable reliance on
such advice shall in no event subject any of them to liability to the Company
or any Target Company, or any of their respective affiliates.


 


3.2           Indemnification.
Parent shall, to the fullest extent permitted by applicable laws, indemnify and
hold harmless each of the Indemnified Persons from and against any and all
Losses to which such Indemnified Person may become subject in connection with
or arising out of or related to this Agreement, including, without limitation,
in connection with providing or failing to provide Services (or any act or
omission in connection therewith); provided, however, that the
foregoing indemnification shall not include or apply to the extent that any
Losses are determined by a final decision (after all appeals and the expiration
of time to appeal) of a court of competent jurisdiction to have resulted from
the fraud or gross negligence of such Indemnified Person. In the event that any
Indemnified Person becomes involved in any capacity in any action, proceeding
or investigation in connection with any matter arising out of or in connection
with this Agreement, Parent will periodically advance to or reimburse such
Indemnified Person for its legal and other expenses (including the cost of any
investigation and preparation) as incurred in connection therewith; provided,
however, that such Indemnified Person shall promptly repay to Parent the
amount of any such advanced or reimbursed expenses paid to it to the extent it
shall ultimately be determined by a final decision (after all appeals and the
expiration of time to appeal) of a court of competent jurisdiction that such Indemnified
Person is not entitled to such advance or reimbursement by Parent as herein
provided in connection with such action, proceeding or investigation. The
rights of indemnification provided in this Section 3.2 will be in addition to
any rights to which an Indemnified Person may otherwise be entitled by contract
or as a matter of law, including pursuant to the bylaws of the Company, and
shall extend to each of its or his heirs, successors and assigns.


 


4.             TERM.


 


4.1           The
term of this Agreement shall commence on the date hereof and shall terminate on
the earlier of (a) the date on which GW and his Permitted Transferees cease to
own


 


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all of the Shares so owned as of the date hereof (other
than Shares sold by such persons in accordance with Sections 2.4 and 2.5 of the
Stockholders’ Agreement), and (b) the termination of the OEP Management
Agreement.


 


4.2           In
the event of a Sale of the Company (as defined in the Stockholders’ Agreement),
Parent shall have the right to terminate this Agreement by providing prior
written notice of termination to the Manager.


 


4.3           Notwithstanding
anything in this Section 4 to the contrary, the Manager shall have the right to
terminate this Agreement at any time by providing prior written notice of
termination to Parent and OEP.


 


5.             NOTICES.


 


5.1           All
notices, requests, demands and other communications provided for by this
Agreement shall be in writing and shall be deemed to have been given at the
time when received by registered or certified mail, return receipt requested,
or by a nationally recognized overnight courier service or given in person, to
the following addresses of the parties hereto or to such changed address as
such party may have specified for notice:


 


	
   

  	
  Manager:

  
	
   

  	
   

  
	
   

  	
  c/o Alfred D. Boyer

  
	
   

  	
  542
  The Strand

  
	
   

  	
  Hermosa
  Beach, California 90254

  
	
   

  	
  Facsimile:  (310)
  937-6149

  
	
   

  	
   

  
	
  Parent:

  	
  Progress Rail Services
  Parent Corp.

  
	
   

  	
  1600 Progress Drive

  
	
   

  	
  P.O. Box 1037

  
	
   

  	
  Albertville, Alabama
  35950

  
	
   

  	
  Facsimile:  (256)
  840-2782

  
	
   

  	
  Attention: Chief
  Executive Officer

  
	
   

  	
   

  
	
   

  	
  with a copy to:

  
	
   

  	
   

  
	
   

  	
  Morgan, Lewis &
  Bockius LLP

  
	
   

  	
  101 Park Avenue

  
	
   

  	
  New York, New York
  10178-0060

  
	
   

  	
  Facsimile:  (212)
  309-6273

  
	
   

  	
  Attention:  Ira
  White, Esq.

  
	
   

  	
   

  
	
  OEP:

  	
  One Equity Partners LLC

  
	
   

  	
  One Bank One Plaza,
  14th Floor

  
	
   

  	
  Chicago, Illinois
  60670-0610

  
	
   

  	
  Facsimile: (312)
  732-7495

  
	
   

  	
  Attention: Thomas J.
  Kichler

  



 


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  with a copy to:

  
	
   

  	
   

  
	
   

  	
  Morgan, Lewis &
  Bockius LLP

  
	
   

  	
  101 Park Avenue

  
	
   

  	
  New York, New York
  10178-0060

  
	
   

  	
  Facsimile:  (212)
  309-6273

  
	
   

  	
  Attention:  Ira
  White, Esq.

  



 


6.             MISCELLANEOUS.


 


6.1           Headings
and Captions. All headings and captions contained in this Agreement are for
convenience only and shall not be deemed a part of this Agreement.


 


6.2           Variations
of Pronouns. All pronouns and all variations thereof shall be deemed to
refer to the masculine, feminine or neuter, singular or plural, as the identity
of the person may require.


 


6.3           Counterparts.
This Agreement may be executed in counterparts, each of which shall constitute
an original and all of which, when taken together, shall constitute the same
agreement.


 


6.4           Governing
Law. All questions concerning the construction, validity and interpretation
of this Agreement and the exhibits hereto will be governed by and construed in
accordance with the domestic laws of the State of New York, without giving
effect to any choice of law or conflict of law provision or rule (whether of
the State of New York or any other jurisdiction) that would cause the
application of the laws of any jurisdiction other than the State of New York.


 


6.5           No
Assignment. This Agreement may not be assigned by any party hereto without
the consent of each other party hereto.


 


6.6           Severability.
The parties hereto intend that each provision hereof constitute a separate
agreement among them. Accordingly, the provisions hereof are severable and in
the event that any provision of this Agreement shall be deemed invalid or
unenforceable in any respect by a court of competent jurisdiction, the
remaining provisions hereof shall not be affected, but shall, subject to the
discretion of such court, remain in full force and effect, and any invalid or
unenforceable provision shall be deemed, without further action on the part of
the parties hereto, amended and limited to the extent necessary to render the
same valid and enforceable.


 


6.7           Entire
Agreement; Amendments. This Agreement constitutes the entire agreement of
the parties hereto with respect to the transactions contemplated hereby and
supersedes all prior oral or written agreements and understandings with respect
to the subject matter hereof. This Agreement may be amended, modified or
supplemented only by a written instrument executed by or on behalf of each of
the parties hereto.


 


6.8           No
Third Party Beneficiaries. The terms and provisions of this Agreement are
intended solely for the benefit of each party hereto and their respective
successors and permitted assigns, and it is not the intention of the parties to
confer, and no provision hereof shall confer third party beneficiary rights
upon any other person or entity.


 


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6.9           Effect
of Termination or Non-Renewal. The provisions of Sections 1.2, 5 and 6
hereof shall survive any termination or non-renewal of this Agreement. The fees
paid or payable hereunder prior to any termination or non-renewal of this
Agreement pursuant to Section 2 hereof shall be deemed earned when they become
so payable and shall not be affected by any subsequent termination or
non-renewal of this Agreement.


 


[Signature Page to
Follow]


 


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IN WITNESS WHEREOF, the
parties hereto have caused this Agreement to be executed by their
representatives thereunto duly authorized as of the day and year first above
written.


 


 


	
   

  	
   /s/ Gary L.
  Wilson

  	
   

  
	
   

  	
  Gary L. Wilson

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   /s/ Alfred D.
  Boyer

  	
   

  
	
   

  	
  Alfred D. Boyer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   /s/ Robert Day

  	
   

  
	
   

  	
  Robert Day

  



 

















 


	
   

  	
  PROGRESS RAIL SERVICES
  PARENT CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ William P.
  Ainsworth

  	
   

  
	
   

  	
   

  	
  Name:  William
  P. Ainsworth

  
	
   

  	
   

  	
  Title:  President
  and Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  ONE EQUITY PARTNERS LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Thomas J.
  Kichler

  	
   

  
	
   

  	
   

  	
  Name:  Thomas
  J. Kichler

  
	
   

  	
   

  	
  Title:  Partner