Exhibit
10.1


 


ADVISORY AGREEMENT


 


This Advisory Agreement (this “Agreement”) is
made and entered into as of April 1, 2004, by and between Samsonite
Corporation, a Delaware corporation (the “Company”) and ACOF Operating
Manager, L.P., a Delaware limited partnership
(the “Advisor”).


 


WHEREAS, the Company, ACOF Management, L.P., a
Delaware limited partnership (“Ares”), an affiliate of the Advisor, Bain
Capital (Europe) LLC, a Delaware limited liability company (“Bain”) and Ontario
Teachers’ Pension Plan Board (together with Ares and Bain, the “Investors”) are
parties to a Recapitalization Agreement dated May 1, 2003 (the “Recapitalization
Agreement”);


 


WHEREAS, prior to completion of the negotiation of the
transactions contemplated by the Recapitalization Agreement, the Investors
notified the Company that following completion of such transactions they would
be requesting, subject to approval of the Company’s board of directors (the
“Board”), that the Company enter into advisory agreements with each of the Investors
or its designee (the “Agreements”);


 


WHEREAS, the shareholders of Samsonite Corporation, in
the proxy statement mailed to the shareholders of the Company seeking approval
of the transactions contemplated by the Recapitalization Agreement, were
informed of the Investors’ intentions;


 


WHEREAS, the management of the Company has availed
itself of the services of certain of the Investors since July 31, 2003, subject
to the subsequent ratification by the Board and its approval of the Agreements;


 


WHEREAS, the Board desires to ratify management’s use
of the services of certain of the Investors prior to the date hereof and to
retain the Advisors with respect to the services described herein;


 


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NOW, THEREFORE, in consideration of the premises and
the mutual covenants contained herein, the parties agree as follows:


 


1.             Term.  Subject to the provisions for termination
set forth herein, this Agreement shall be in effect for a maximum five-year
term commencing as of July 31, 2003 (the “Effective Date”) and ending on
the fifth anniversary of the Effective Date (the “Term”); provided,
however, the Term shall terminate at such time as the Advisor and its
affiliates no longer hold at least 33% of the capital stock of the Company that
they owned as of the date of the closing of the transactions under the
Recapitalization Agreement.  If the
Advisor has acted with willful misconduct or gross negligence in the
performance of material services for the Company hereunder or if the Advisor
has materially breached its obligations hereunder, the Board may terminate this
Agreement; provided, however, that such misconduct, gross negligence or
material breach shall not have been cured and shall be continuing for more than
30 days after receipt by the Advisor from the Board of written notice detailing
such misconduct or gross negligence.


 


2.             Services.  Commencing on the Effective Date, the
Advisor shall perform or cause to be performed such services for the Company
and its subsidiaries as mutually agreed by the Advisor and the Company (the “Services”),
which may include, without limitation, the following:


 


(a)           general executive and management
services;


 


(b)           services in obtaining and arranging
equity, debt and lease financing and support, identification, negotiation and
analysis of financing alternatives, including, without limitation, in
connection with mergers, acquisitions, divestitures, capital expenditures and
refinancing of existing indebtedness;


 


(c)           finance functions, including assistance
in the preparation of financial projections, and monitoring of compliance with
financing agreements;


 


(d)           marketing functions, including
monitoring of marketing plans and strategies;


 


(e)           human resource functions, including
searching and hiring of executives; and


 


(f)            other services for the Company and
its subsidiaries upon which the Board and the Advisor may agree from time to
time.


 


3.             Advisory Fee.


 


(a)           During the Term, the Advisor and/or
its designees shall receive an aggregate sum of $500,000 per annum (prorated
for partial years), plus VAT where applicable, payable by the Company on a
quarterly basis in advance (each an “Advisory Fee” and collectively the
“Advisory Fees”) (except for the first two quarterly payments which
shall be paid within 30 days of presentation of an invoice for the Advisory
Fees from the Advisor to the Company); provided that the parties to this
Agreement agree to work in good faith to structure the transactions
contemplated by this Agreement in a manner tax-efficient for all parties to the


 


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extent
reasonably practicable.  The Advisory Fees are intended to be a
flat fee and, as such, shall be payable by the Company to the Advisor
irrespective of the actual level of services provided.  In addition, the Company shall reimburse the
reasonable out-of-pocket expenses (“Expenses”) of the Advisor and/or their
affiliates incurred in connection with the Services subject to the receipt of
reasonable supporting documentation satisfactory to the Company in its
reasonable discretion.  An amount equal
to VAT paid by the Advisor on Expenses shall be reimbursed by the Company in
addition to such Expenses to the extent that VAT on such Expenses is irrecoverable
for the Advisor (by credit, set off, reimbursement or otherwise).


 


(b)           Notwithstanding the forgoing three
sentences, if the Company is prohibited from paying any portion of the Advisory
Fees pursuant to the Credit Agreement dated July 31, 2003 between the Company,
Samsonite Europe N.V., General Electric Capital Corporation, KBC Bank N.V.,
GECC Capital Markets Group, Inc., and certain other parties thereto, or any
subsequent credit agreement(s) to which the Company is a party (the “Credit
Agreements”), or pursuant to the Indenture, dated as of June 24, 1998,
governing the Company’s 103⁄4% Senior Subordinated Notes due 2008 and any
indenture governing any future issuance of debt instruments issued by the
Company (the “Bond Indentures”), the non-payment of such portion shall
not constitute a default and such portion shall be paid to the Advisor
immediately upon such dates as such payment is no longer prohibited pursuant to
the Credit Agreements or the Bond Indentures and such unpaid portion of the
Advisory Fees shall accrue interests at a rate of 8% per annum (the “Accrued
Advisory Fees”);


 


4.             Personnel.  The Advisor shall provide and devote to the
performance of this Agreement such partners, employees and agents of the
Advisor as the Advisor shall deem appropriate to the furnishing of the Services.


 


5.             Liability.  Neither the Advisor nor any of its
affiliates, partners, members, employees or agents (collectively, the “Advisor
Group”) shall be liable to the Company or its subsidiaries or any of their
affiliates for any loss, liability, damage or expense (including attorney’s
fees and expenses) (collectively, a “Loss”) arising out of or in
connection with the performance of services contemplated by this Agreement,
except to the extent any such Loss results from the gross negligence, willful
misconduct or bad faith of any member of the Advisor Group as determined in a
final, non-appealable order by a court of competent jurisdiction.  The Advisor makes no representations or
warranties, express or implied, in respect of the Services to be provided by the
Advisor Group.  Except as the Advisor
may otherwise agree in writing after the date hereof and subject to Section 7
hereof: (i) each member of the Advisor Group shall have the right to, and shall
have no duty (contractual or otherwise) not to, directly or indirectly: (A)
engage in the same or similar business activities or lines of business as the
Company or its subsidiaries or any of their affiliates and (B) do business with
any client or customer of the Company or its subsidiaries or any of their affiliates;
(ii) no member of the Advisor Group shall be liable to the Company or its
subsidiaries or affiliates for breach of any duty (contractual or otherwise) by
reason of any such activities or of such person’s participation therein; and
(iii) in the event that any member of the Advisor Group acquires knowledge of a
potential transaction or matter (but only to the extent such Advisor acquires
such knowledge outside his capacity as such an Advisor under this Agreement)
that may be a corporate opportunity for both the Company or any of its
subsidiaries or any of their


 


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affiliates, on the
one hand, and the Advisor, on the other hand, or any other person, no member of
the Advisor Group shall have any duty (contractual or otherwise) to communicate
or present such corporate opportunity to the Company or its subsidiaries or any
of their affiliates and, notwithstanding any provision of this Agreement to the
contrary, shall not be liable to the Company, its subsidiaries or any of their
affiliates for breach of any duty (contractual or otherwise) by reasons of the
fact that any member of the Advisor Group directly or indirectly pursues or
acquires such opportunity for itself, directs such opportunity to another person,
or does not present such opportunity to the Company, its subsidiaries or any of
their affiliates.  In no event will any
of the parties hereto be liable to any other party hereto for any indirect,
special, incidental or consequential damages, including lost profits or
savings, whether or not such damages are foreseeable, or in respect of any
liabilities relating to any third party claims (whether based in contract, tort
or otherwise) other than for the Claims (as defined in Section 6 below)
relating to the Services which may be provided by the Advisor hereunder.


 


6.             Indemnity.  The Company and its subsidiaries shall
defend, indemnify and hold harmless each member of the Advisor Group from and
against any and all Losses (including, without limitation, attorneys’ fees)
arising from any claim by any person with respect to, or in any way related to,
this Agreement (collectively, “Claims”) resulting from any act or
omission of any member of the Advisor Group, except to the extent such Claims
are the result of gross negligence, bad faith or willful misconduct by any
member of the Advisor Group as determined in a final, non-appealable order by a
court of competent jurisdiction.  The
Company and its subsidiaries shall defend at its own cost and expense any and
all suits or actions (just or unjust) which may be brought against the Company
or its subsidiaries and any member of the Advisor Group or in which any member
of the Advisor Group may be impleaded with others upon any Claims, or upon any
matter, directly or indirectly, related to or arising out of this Agreement or
the performance hereof by the Advisor Group, except to the extent such damage
shall be proven to be the direct result of gross negligence, bad faith or
willful misconduct by any member of the Advisor Group as determined in a final,
non-appealable order by a court of competent jurisdiction, to which extent the
Advisor shall reimburse the Company for the costs of defense and other costs
incurred by the Company associated therewith. 
The Company shall be liable for reasonable fees and expenses of no more
than one counsel (in addition to local counsel) in connection with the defense
of indemnifiable damages hereunder, except that the Company shall be liable for
the fees and expenses of additional separate counsel to the extent the member
of the Advisor Group concludes reasonably, based upon advice of counsel, that
(a) a conflict of interest exists between the member of the Advisor Group and
the Company or another member of the Advisor Group or (b) the named parties to
such action include both the Company and the member of the Advisor Group and
there may be one or more legal defenses available to such member of the Advisor
Group which are not available to the Company, or available to the Company, but
the assertion of which would be adverse to the interests of the Company.


 


7.             Confidentiality.  All material non-public information
concerning the Company which is given to the Advisor in its capacity as
such,  or to its directors, officers,
employees, agents, advisors (including, without limitation, attorneys,
accountants, consultants, bankers and financial advisors) or other person
associated with or acting on behalf of any such person in such person’s
capacity as such (collectively, “Representatives”), by the Company or
its Representatives from time to time will be used solely in the course of the
performance of the Advisor’s services hereunder or, in


 


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the case of any of
such person who is also an officer and/or director of the Company, in such
person’s capacity as an officer and/or director of the Company.  Except as contemplated by this Agreement or
as otherwise required by applicable law or judicial, regulatory or securities
exchange process, the Advisor will not disclose any material non-public
information so provided to it to a third party without the Company’s consent,
which shall not be unreasonably withheld or delayed.


 


8.             Severability.  Should any provision of this Agreement be or
become invalid in whole or in part or should this Agreement or any provision
thereof be or become incomplete, this shall not affect the validity of the
remaining provisions hereof. In lieu of the invalid provision or in order to
cure any incompleteness, a provision shall apply which, to the extent legally
permissible, comes as close as possible to what the parties had intended or
would have agreed upon, if they had been aware of the invalidity or
incompleteness.


 


9.             Notices.  All notices hereunder shall be in writing
and shall be delivered personally or mailed by first class mail, postage
prepaid, addressed to the parties as follows:


 


To the Company:


 


Samsonite Corporation


11200 East 45th Street


Denver, Colorado 80239


Facsimile: (303) 373-6606


Attn: General Counsel


 


To the Advisor:


 


Ares Corporate Opportunity Fund, L.P.


C/o Ares Management, LLC


1999 Avenue of the Stars, Suite 1900


Los Angeles, CA 90067


UNITED STATES OF AMERICA


Facsimile: +1-310-201-4157


Att:         Eric
Beckman


Jennifer Hirsch


 


10.           Assignment.  Neither party may assign any obligations
hereunder to any other party without the prior written consent of the other
party (which consent shall not be unreasonably withheld); provided that the
Advisor may, without consent of the Company, assign its rights and obligations
under this Agreement to any of its affiliates, including without limitation
affiliated investment funds.  The
assignor shall remain liable for the performance of any assignee.


 


11.           Successors.  This Agreement and all the obligations and
benefits hereunder shall inure to the successors and assigns of the parties.


 


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12.           Counterparts.  This Agreement may be executed and delivered
by each party hereto in separate counterparts, each of which when so executed
and delivered shall be deemed an original and all of which taken together shall
constitute but one and the same agreement.


 


13.           Entire Agreement; Modification;
Governing Law, Dispute Resolution. 
The terms and conditions hereof constitute the entire agreement between
the parties hereto with respect to the subject matter of this Agreement and
supersede all previous communications, either oral or written, representations
or warranties of any kind whatsoever, except as expressly set forth herein.  The parties to this Agreement may amend its
terms and conditions, however, no modifications of this Agreement nor waiver of
the terms or conditions thereof shall be binding upon either party unless
approved in writing by an authorized representative of such party.  All issues concerning this agreement shall
be governed by and construed in accordance with the laws of the State of New
York, without giving effect to any choice of law or conflict of law provision
or rule (whether of New York or any other jurisdiction) that would cause the application
of the law of any jurisdiction other than the State of New York.


 


14.           Joint and Several Liability.  Each obligation described herein of the
Company shall be a joint and several obligation of the Company and its
subsidiaries.  If requested by the Advisor,
then the Company shall cause any of its respective subsidiaries to sign a
counterpart signature page to this Agreement to evidence such joint and several
liability.


 


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IN WITNESS WHEREOF, the parties have executed this
Agreement as of the date first written above.


 


 


	
   

  	
  SAMSONITE
  CORPORATION

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  ACOF
  OPERATING MANAGER, L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Ares Management, Inc., its general partner

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title: