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P ACHULSKI S TANG Z IEHL & J ONES LLP
Richard M. Pachulski (CA Bar No. 90073) James I. Stang (CA Bar No. 94435) Dean A. Ziehl (CA Bar No. 84529) Linda F. Cantor (CA Bar No. 153762) Debra I. Grassgreen (CA Bar No. 169978) PACHULSKI STANG ZIEHL & JONES LLP 10100 Santa Monica Blvd., Suite 1300 Los Angeles, CA 90067-4114 Telephone: 310/277-6910 Facsimile: 310/201-0760 E-mail: rpachulski@pszjlaw.com jstang@pszjlaw.com dziehl@pszjlaw.com lcantor@pszjlaw.com dgrassgreen@pszjlaw.com Proposed Attorneys for Debtor and Debtor in Possession UNITED STATES BANKRUPTCY COURT CENTRAL DISTRICT OF CALIFORNIA SANTA ANA DIVISION In re: American Suzuki Motor Corporation,1 Debtor. Case No.: 12-_____ ( ) Chapter 11 NOTICE OF DEBTORS APPLICATION FOR AN ORDER, PURSUANT TO 11 U.S.C. 327(a) AND 328(a), AUTHORIZING THE EMPLOYMENT AND RETENTION OF IMPERIAL CAPITAL, LLC AS INVESTMENT BANKER, NUNC PRO TUNC TO THE PETITION DATE [NO HEARING REQUIRED UNLESS REQUESTED PER L.B.R. 2014-1(b)] TO: (A) THE UNITED STATES TRUSTEE; (B) COUNSEL FOR THE DEBTORS PREPETITION AND POSTPETION LENDER; (C) THE CREDITORS APPEARING ON THE LIST FILED IN ACCORDANCE WITH RULE 1007(D) OF THE FEDERAL RULES OF BANKRUPTCY PROCEDURE; AND (D) THOSE PARTIES WHO HAVE REQUESTED NOTICE PURSUANT TO BANKRUPTCY RULE 2002. PLEASE TAKE NOTICE that on the date hereof (the Petition Date), the above-captioned debtor and debtor in possession (the Debtor) filed a voluntary petition for relief under chapter 11
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The last four digits of the Debtors federal tax identification number are (8739). The Debtors address is: 3251 East Imperial Highway, Brea, CA 92821.
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of title 11 of the United States Code (the Bankruptcy Code) with the Clerk of the United States Bankruptcy Court for the Central District of California (the Bankruptcy Court). PLEASE TAKE FURTHER NOTICE that on the date hereof the Debtor filed the Debtors Application for an Order, Pursuant to 11 U.S.C. 327(a) and 328(a), Authorizing the Employment and Retention of Imperial Capital, LLC as Investment Banker, Nunc Pro Tunc to the Petition Date (the Application) with the Bankruptcy Court. PLEASE TAKE FURTHER NOTICE that, pursuant to Local Rule 2014-1(b)(3)(E), any response or objection to the Application must be filed with the Bankruptcy Court on or before November 20, 2012 at 4:00 p.m. (Pacific time). PLEASE TAKE FURTHER NOTICE that, at the same time, you must also serve a copy of the response or objection upon: (i) proposed attorneys for the Debtor: Pachulski Stang Ziehl & Jones LLP, 10100 Santa Monica Boulevard, 13th Floor, Los Angeles, California 90067-4100, Attention: Debra I. Grassgreen (dgrassgreen@pszjlaw.com) and John W. Lucas (jlucas@pszjlaw.com) and (ii) the U.S. Trustee, 411 West Fourth Street, Suite 9041, Santa Ana, CA 92701, and shall be filed with the Clerk of the United States Bankruptcy Court, Central District of California. PLEASE TAKE FURTHER NOTICE THAT IF YOU FAIL TO RESPOND IN ACCORDANCE WITH THIS NOTICE, THE COURT MAY GRANT THE RELIEF DEMANDED BY THE APPLICATION WITHOUT FURTHER NOTICE OR HEARING. PLEASE TAKE FURTHER NOTICE that if a timely objection is filed, that a hearing will be scheduled and the Debtor will provide separate notice therefor. Dated: November 5, 2012 PACHULSKI STANG ZIEHL & JONES LLP By /s/ Debra I. Grassgreen Richard M. Pachulski James I. Stang Dean A. Ziehl Linda F. Cantor Debra I. Grassgreen Proposed Attorneys for Debtor and Debtor in Possession
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Richard M. Pachulski (CA Bar No. 90073) James I. Stang (CA Bar No. 94435) Dean A. Ziehl (CA Bar No. 84529) Linda F. Cantor (CA Bar No. 153762) Debra I. Grassgreen (CA Bar No. 169978) PACHULSKI STANG ZIEHL & JONES LLP 10100 Santa Monica Blvd., Suite 1300 Los Angeles, CA 90067-4114 Telephone: 310/277-6910 Facsimile: 310/201-0760 E-mail: rpachulski@pszjlaw.com jstang@pszjlaw.com dziehl@pszjlaw.com lcantor@pszjlaw.com dgrassgreen@pszjlaw.com Proposed Attorneys for Debtor and Debtor in Possession UNITED STATES BANKRUPTCY COURT CENTRAL DISTRICT OF CALIFORNIA SANTA ANA DIVISION In re: American Suzuki Motor Corporation,1 Debtor. Case No.: 12-_____ ( ) Chapter 11 DEBTORS APPLICATION FOR AN ORDER, PURSUANT TO 11 U.S.C. 327(a) AND 328(a), AUTHORIZING THE EMPLOYMENT AND RETENTION OF IMPERIAL CAPITAL, LLC AS INVESTMENT BANKER, NUNC PRO TUNC TO THE PETITION DATE [NO HEARING REQUIRED UNLESS REQUESTED PER L.B.R. 2014-1(B)]
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The above-captioned debtor and debtor in possession (the Debtor) hereby seeks entry of an order pursuant to sections 327(a) and 328(a) of title 11 of the United States Code (the Bankruptcy Code), Rules 2014(a) and 2016 of the Federal Rules of Bankruptcy Procedure (the Bankruptcy Rules) and Rule 2014-1 of the Local Rules of the United States Bankruptcy Court for the Central
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District of California (the Local Rules) authorizing the Debtors retention and employment of Imperial Capital, LLC (Imperial or the Firm) as its investment banker for purposes of marketing the sale of assets nunc pro tunc to the Petition Date (the Application). The facts and circumstances supporting this Application are set forth in the Declaration of Marc Bilbao (the Bilbao Declaration), attached hereto as Exhibit A. In further support of this Application, the Debtors respectfully represent as follows: I. JURISDICTION This Court has jurisdiction over this Motion pursuant to 28 U.S.C. 157 and 1334. This is a core proceeding pursuant to 28 U.S.C. 157(b)(2). Venue is proper before this Court pursuant to 28 U.S.C. 1408 and 1409. The statutory bases for the relief sought herein are sections 327(a) and 328(a) of the Bankruptcy Code and Bankruptcy Rule 2014(a). II. STATEMENT OF FACTS A. General Background On the date hereof (the Petition Date), the Debtor filed a voluntary petition for relief under chapter 11 of title 11 of the United States Code (the Bankruptcy Code). The Debtor continues to operate and manage its affairs as a debtor in possession pursuant to sections 1107(a) and 1108 of the Bankruptcy Code. No trustee, examiner, or committee has been appointed in this chapter 11 case. The Debtor was established in 1986 as the sole distributor in the continental United States of Suzuki automobiles, motorcycles, all-terrain vehicles, and marine outboard engines (the Suzuki Products). Suzuki Motor Corporation (SMC), the 100% interest holder in the Debtor, manufacturers substantially all of the Suzuki Products2 and is not a debtor in this or any other insolvency proceeding. As of the Petition Date, the Debtor has approximately 295 employees across three divisions: automotive (the Automotive Division), motorcycles and all-terrain vehicles (the
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The ATVs are manufactured by an 80% owned affiliate of the Debtor. An overview of the Suzuki Products manufactured by SMC, its affiliates, and certain unaffiliated entities is included in the Declaration of M. Freddie Reiss, Proposed Chief Restructuring Officer, in Support of Emergency First Day Motions.
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Motorcycles/ATV Division), and outboard marine motors and related products (the Marine Division). In the operation of its business, the Debtor purchases Suzuki Products from SMC and certain other non-debtor affiliates. In turn, the Debtor wholesales virtually its entire inventory through a network of independently owned and unaffiliated dealerships located throughout the continental United States. The dealers then market and sell the Suzuki Products to retail customers. As of the Petition Date, there are approximately 220 automotive dealerships, over 900 motorcycle/ATV dealerships, and over 780 outboard marine dealerships. Through dealers, the Debtor also sells a portion of its automotive inventory (less than 10%) to car rental companies and others (less than 2%) that lease the vehicles to retail customers. The Debtor also purchases the majority of its automotive parts from SMC and certain unaffiliated companies and resells them to the automotive dealers and authorized warranty service providers. The Debtor determined that its Automotive Division is facing and will continue to face a number of serious challenges in the highly regulated and competitive automotive industry in the continental U.S. market. The challenges include unfavorable foreign exchange rates, disproportionally high and increasing costs associated with meeting more stringent state and federal automotive regulatory requirements unique to the continental U.S. market, low sales volumes, a limited number of models in its line-up, and existing and potential litigation costs. The Debtor has exhausted all available means to reduce the cost of operating the Automotive Division for it to operate profitably. Accordingly, the Debtor determined that the best way to preserve and enhance the value of its overall business is to wind down new sales of the Automotive Division in the continental U.S. and realign its business focus on the long-term growth of its Motorcycles/ATV and Marine Divisions. Contemporaneous with the filing of this case, the Debtor filed a plan of reorganization (the Plan). Under the proposed Plan, the Motorcycles/ATV and Marine Divisions will remain largely unaffected including the warranties associated with such products. As part of its restructuring, NounCo, Inc., a wholly owned subsidiary of SMC, will purchase the Motorcycles/ATV and Marine Divisions and the parts and service components of the Automotive Division. The restructured
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Automotive Division intends to honor automotive warranties and authorize the sale of genuine Suzuki automotive parts and services to retail customers through a network of parts and service only dealerships that will provide warranty services. The Debtors Motorcycles/ATV Division is strong and competitively positioned in its market, allowing for long-term growth as economic conditions improve. Similarly, the Marine Division has remained competitive during the recent challenging economic times and the Debtor is working to further build its market share in the marine industry through continued investment in new product development and resuming large-scale marketing events focused on attracting new marine customers. The strategy embodied in the proposed Plan returns the business to its roots in the U.S. market, which began with motorcycles, and is intended to position the overall business for success in the continental U.S. for the benefit of all parties in interest. The Suzuki name is recognized around the world as a brand of quality products that offer reliability and originality. SMC has informed the Debtor that it continues to invest in its operations, improve its overall performance worldwide, and remains committed to manufacturing Suzuki Products for customers around the world. SMCs manufacturing and world-wide distribution of Suzuki automobiles will continue despite the Debtors wind down of the continental U.S. Automotive Division. Additional factual background regarding the Debtor, including its current and historical business operations and the events precipitating its chapter 11 filing, is set forth in detail in the Declaration of M. Freddie Reiss, Proposed Chief Restructuring Officer, in Support of Emergency First Day Motions (the Reiss Declaration) filed contemporaneously with this Motion and incorporated herein by reference. III. RELIEF REQUESTED By this Application, the Debtor seeks to employ and retain Imperial as its investment banker, for purposes of marketing the Debtors assets nunc pro tunc to the Petition Date, pursuant to the terms of an Engagement Agreement, dated as of November 1, 2012 (the Engagement Agreement),
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a copy of which is attached to the Bilbao Declaration as Exhibit 1 and is incorporated herein by reference. Imperial is a full-service investment bank offering sophisticated institutional sales and trading, a wide range of investment banking advisory, capital markets and restructuring services, and institutional research. Imperials institutional sales and trading professionals service over 1,200 institutional accounts. Imperials investment banking professionals provide advisory services to middle market corporations, institutional investors, and private equity funds. In particular, Imperial and its professionals have extensive experience working with financially troubled companies in complex financial restructurings both in chapter 11 cases and in out-of-court situations. Imperial is highly qualified to advise on strategic alternatives and its professionals have extensive experience in deals involving complex financial and operational restructurings. As an active bankruptcy and restructuring advisor with significant experience in a variety of industries, Imperial is well-qualified to serve as investment banker and financial advisor to the Debtor. Imperial specializes in assisting and advising debtors, creditors, creditors committees, shareholders, bondholders and other parties involved with financially distressed companies, both during and outside of bankruptcy cases, and has served as investment bankers, financial and strategic advisors for debtors, creditors, and other constituents in numerous chapter 11 cases. See, e.g., In re Specialty Trust, Inc., et al., No. 10-51432 (GWZ) (Bankr. D. Nev. July 23, 2010) [Dkt No. 293], In re Mesa Air Group, et al., No. 10-10018 (MG) (Bankr. S.D.N.Y. March 1, 2010) [Dkt. No. 372], In re MagnaChip Semiconductor Finance Co., No. 09-12008 (PJW) (Bankr. D. Del. Sept. 10, 2009) [Dkt No. 274], In re Monaco Coach Corp., No. 09-10750 (KJC) (Bankr. D. Del. April 9, 2009) [Dkt No. 132], In re Qimonda Richmond LLC, No. 09-10589 (MFW) (Bankr. D. Del. May 18, 2009) [Dkt No. 370], In re Landsource Communities Development LLC, No. 08-11111 (KJC) (Bankr. D. Del. Aug. 27, 2008) [Dkt No. 504], In re Aloha Airlines Inc., No. 08-00337 (LK) (Bankr. D. Haw. April 8, 2008) [Dkt No. 203], In re Movie Galley Inc., No. 07-33849 (DOT) (Bankr. E.D. Va. Nov. 27, 2007) [Dkt No. 1016], In re Custom Food Products, Inc., No. 07-10495 (PJW) (Bankr. D. Del. June
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14, 2007) [Dkt No. 307], and In re Mesaba Aviation, Inc., No. 05-39258 (GFK) (Bankr. D. Minn. June 8, 2005) [Dkt No. 641]. In light of the size and complexity of this chapter 11 case, the Debtor requires the service of a seasoned and experienced investment banker, and one that is familiar with the chapter 11 process. Additionally, the Debtor believes that by having an investment banker provide these services in this chapter 11 case, other professionals in this case and company officers who might otherwise handle complex financial and financing matters will be able to focus better on their respective competencies and their core tasks and efficiently and effectively advise in the management of the Debtors business and operations and to facilitate a successful chapter 11 process. Imperial is wellqualified to provide the services being sought by the Debtor, and the employment of Imperial under the terms contained in the Engagement Agreement will benefit the Debtors estate and its reorganization efforts. SERVICES TO BE PROVIDED Pursuant to the terms of the Engagement Agreement, Imperial will provide such consulting and advisory services as Imperial and the Debtor deems appropriate and feasible to advise the Debtor in the course of this chapter 11 case. Specifically, Imperial will render various services to the Debtor including, but not limited to, the following:3 (a) analysis of the Debtors business, operations, properties, financial condition, competition, forecast, prospects and management; (b) advising the Debtor on a proposed purchase price and form of consideration for the Transaction; (c) assisting the Debtor in developing, evaluating, structuring and negotiating the terms and conditions of a potential Transaction; (d) assisting the Debtor in the preparation of solicitation materials with respect to the Transaction and the Debtor (the Transaction Offering Materials) (e) identification of and contacting selected qualified buyers (Buyers) for the Transaction and furnishing them, on behalf of the Debtor, with copies of Offering Materials;
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To the extent any summary of the Engagement Agreement in this Application and the terms of the Engagement Agreement are inconsistent, the terms of the Engagement Agreement (as the same may be modified by the Order approving this Application) shall control. Capitalized terms that are used but not defined in this Application shall have the meanings ascribed to them in the Engagement Agreement.
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(f) assisting the Debtor in arranging for potential Buyers to conduct due diligence investigations; and (g) providing such other financial advisory services with respect to the Debtors financial issues as may from time to time be agreed upon between the Debtor and Imperial. In order to maximize the chance of a successful reorganization and the enhancement of the
5 value of the estate, the Debtor requires the services of a capable and experienced investment banker 6 and financial advisor in this chapter 11 case. As noted above, Imperial has substantial expertise in 7 these areas, and, as a result, Imperial is well qualified to perform these services and represent the 8 Debtors interest in this case. 9 PROFESSIONAL COMPENSATION 10 Imperials willingness to advise and assist the Debtor is contingent upon its ability to be
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without limitation, the indemnification provision contained in Schedule 1 to the Engagement 13 Agreement. 14 The proposed overall compensation structure is comparable to compensation generally 15 charged by investment bankers of similar stature for comparable engagements, both in and out of 16 court and reflects a balance between a fixed monthly fee and fees contingent on the consummation 17 and closing of the transactions contemplated by the Engagement Agreement. 18 Except as described below, Imperial intends to apply for compensation for professional 19 services rendered and reimbursement of expenses incurred in connection with this chapter 11 case, 20 subject to the Courts approval and in compliance with applicable provisions of the Bankruptcy 21 Code, the Bankruptcy Rules, the Local Bankruptcy Rules for the Central District of California (the 22 Local Rules), any applicable guidelines (the Guidelines) established by the United States 23 Trustee for the Central District of California, and any other applicable procedures and orders of the 24 Court and consistent with the proposed compensation set forth in the Engagement Agreement (the 25 Compensation Structure). Further because the Debtor is seeking to compensate Imperial pursuant 26 to section 328(a) of the Bankruptcy Code, the Debtor believes that Imperials compensation should 27 not be subject to any additional standard of review under section 330 of the Bankruptcy Code. 28
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As compensation for the services rendered pursuant to the Engagement Agreement, the Debtor has agreed to pay Imperial the following fees (the Fee Structure) in cash, which are presented here in summary form: (a) A monthly financial advisory fee of $100,000 for a minimum of five months (the Monthly Advisory Fee), payable in advance, beginning as of the date of the Engagement Agreement and continuing until the Debtors emergence from chapter 11 proceedings or until the Engagement Agreement is earlier terminated pursuant to its terms. (b) In the event an auction is conducted where at least one party other than Suzuki Motor Corporation submits a competing bid, a transaction fee of $2,000,000 (the M&A Transaction Fee), payable upon consummation of the Transaction. A Transaction shall be deemed to have been consummated upon the earliest of any of the following events to occur: (i) the acquisition of a majority of the outstanding common stock of the Company by the Buyer; (ii) a merger or consolidation of the Company with or into the Buyer; (iii) the acquisition by the Buyer of substantially all of the Companys assets; or (iv) in the case of any other Transaction, the consummation thereof. (c) In addition, without regard to whether the Transaction is consummated or this Agreement expires or is terminated, all fees, disbursements and out-of-pocket expenses (the Expenses) incurred by Imperial in connection with the services to be rendered hereunder (including, without limitation, reasonable attorneys fees, travel and lodging expenses (including business class for any international travel), word processing charges, messenger services, duplicating services, facsimile expenses and other customary expenditures) shall be reimbursed to Imperial, or paid on behalf of Imperial, promptly as billed. Imperial shall be paid a cash deposit of $20,000 (the Deposit) against Expenses upon the execution of this Agreement. Any unused amounts of the Deposit will be returned to the Debtor upon demand. Further, the Debtor shall be responsible for all other expenses associated with the Transaction including, without limitation, its own accounting and attorneys fees, travel and lodging expenses, word processing charges, messenger services, duplicating services, facsimile expenses, printing costs and other expenditures. The Debtor acknowledges that it is customary for the Debtor to reimburse the potential Buyers for all out-of-pocket expenses (including, without limitation, reasonable attorneys fees) associated with pursuing and completing the Transaction. (d) As further consideration, the Debtor has agreed to the indemnification and other obligations set forth in Schedule I attached to the Engagement Agreement, which such Schedule is an integral part of the Engagement Agreement and is incorporated therein by reference. None of the fees payable to Imperial pursuant to the Engagement Agreement shall constitute a bonus or fee enhancement under applicable law.
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In connection with the execution of the Engagement Letter, Imperial received $120,000 on account of the Monthly Advisory Fee for November 2012 and the Deposit. Imperial does not customarily maintain detailed time records similar to those customarily maintained by attorneys, and Imperials services would not be compensated by reference to the number of hours and the Engagement Agreement provides that Imperial shall receive, among other things, certain fixed fees as described above. Further, given the nature of their work (among other things, their focus on beneficial transactions and their incentive to implement such transactions), financial advisors, investment bankers, and similar professionals do not customarily bill on an hourly basis (or other increment thereof). The Debtor, therefore, requests that Imperial be relieved of the obligation to record its time on an hourly basis or in other increments thereof. The Debtor believes the Fee Structure appropriately reflects the nature of the services to be provided by Imperial, is reasonable and comparable to compensation generally charged by investment banking firms of similar stature to Imperial and for comparable engagement, both in and out of bankruptcy proceedings, and reflects a balance between a fixed, monthly fee, and a deferred amount which is tied to the consummation and closing of the transactions and services contemplated by the Debtor and Imperial in the Engagement Agreement. The hours worked, the results achieved, and the ultimate benefit to the Debtor for the work performed by Imperial in connection with its engagement may vary and the Debtor and Imperial have taken this into account in setting the above fees. The Compensation Structure is consistent with Imperials normal and customary billing practices for cases of this size and complexity both in and out of bankruptcy proceedings which require the level of services to be provided. Imperials restructuring capabilities, mergers and acquisitions expertise as well as its capital raising experience, some or all of which may be required by the Debtor during the term of Imperials engagement hereunder, were important factors to the Debtor in determining the Compensation Structure. The Debtor believes that the ultimate benefit of Imperials services hereunder cannot be measured by reference to the number of hours expended by Imperials professionals in the performance of such services.
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The Debtor believes that the fee arrangements in the Engagement Agreement are reasonable under the standards set forth in section 328(a) of the Bankruptcy Code, given (i) the numerous issues Imperial may be required to address in the performance of its services under the Engagement Agreement, (ii) Imperials commitment to the variable level of time and effort necessary to address all such issues as they arise and (iii) the market prices for Imperials services for engagements of this nature in both out-of-court and chapter 11 contexts. Accordingly, Imperial and the Debtor believe the Compensation structure is both reasonable and market-based and should be approved under section 328(a) of the Bankruptcy Code. Imperial will not share or agree to share any compensation to be paid by the Debtor, in connection with services to be performed after the Petition Date, with any other person, other than other principals and employees of Imperial, in accordance with section 504 of the Bankruptcy Code. INDEMNIFICATION PROVISION As stated previously, as part of the overall compensation payable to Imperial under the terms of the Engagement Agreement, the Debtor has agreed, among other things, to indemnify, and provide contribution and reimbursement to, Imperial and certain related parties in accordance with the provisions of the Indemnification Provision attached as Schedule 1 to the Engagement Agreement. The Debtor believes such provision is customary and reasonable for Imperials engagement. Unlike the market for other professionals that the Debtor may retain, such provisions are standard terms of the market for investment bankers. Imperial and the Debtor believe that such provisions are comparable to those generally obtained by investment banking and financial advisory firms of similar stature to Imperial and for comparable engagements, both in and out of court. Accordingly, as part of this Application, the Debtor requests that the Court approve the Indemnification Provision. DISINTERESTEDNESS Imperial has informed the Debtor that, except as may be set forth in the Bilbao Declaration and Exhibit 3 thereto, it (i) has no connection with the Debtor, its creditors or other parties in interest in this case; (ii) does not hold or represent any interest adverse to the Debtors estate; and (iii) believes it is a disinterested person as defined within Bankruptcy Code section 101(14).
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Imperial has further informed the Debtor that it will conduct an ongoing review of its files to ensure that no conflicts or other disqualifying circumstances exist or arise. If any new material facts, connections or relationships are discovered or arise, Imperial will supplement its disclosure to the Court. As described in the Bilbao Declaration, Imperial and its affiliates may have and may continue to have investment banking and other relationships with parties other than the Debtor pursuant to which Imperial may acquire information of interest to the Debtor. Imperial shall have no obligation to disclose such information to the Debtor, or to use such information in connection with the matters set forth in Section 1 of the Engagement Agreement. BASIS FOR RELIEF Under sections 327 and 328 of the Bankruptcy Code, a trustee, debtor in possession and committee appointed under section 1102 of the Bankruptcy Code may employ one or more professionals that do not hold or represent an interest adverse to the estates and that are disinterested persons to assist such parties in carrying out their duties under the Bankruptcy Code. Specifically, section 327(a) of the Bankruptcy Code provides that a debtor, subject to Court approval: may employ one or more attorneys, accountants, appraisers, auctioneers, or other professional persons, that do not hold or represent an interest adverse to the estates, and that are disinterested persons, to represent or assist the [debtor] in carrying out the [debtors] duties under this title. 11 U.S.C. 327(a). Section 328(a) provides, in relevant part, that a debtor: with the courts approval, may employ or authorize the employment of a professional person under section 327 . . . on any reasonable terms and conditions of employment, including on a retainer, on an hourly basis, or on a contingent fee basis. 11 U.S.C. 328(a).
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Bankruptcy Rule 2014 requires that an application for retention include: [S]pecific facts showing the necessity for the employment, the name of the [firm] to be employed, the reasons for the selection, the professional services to be rendered, any proposed arrangement for compensation, and, to the best of the applicants knowledge, all of the [firms] connections with the debtor, creditors, any other party in interest, their respective attorneys and accountants, the United States Trustee, or any person employed in the office of the United States Trustee.
Fed. R. Bankr. Proc. 2014. B. Approval Pursuant to Section 328 of the Bankruptcy Code By this Application, the Debtor requests that the Court approve the employment and retention of Imperial, as investment banker for the Debtor, pursuant to the terms of the Engagement Agreement, including, but not limited to the compensation arrangements described above and in the Engagement Agreement pursuant to sections 327(a) and 328(a) of the Bankruptcy Code. The compensation arrangements contained therein are highly beneficial to the Debtors estate as they provide certainty and proper inducement for Imperial to act expeditiously and prudently with respect to the matters for which it will be employed. Section 328 of the Bankruptcy Code permits the compensation of professionals, including investment bankers such as Imperial, on flexible terms that reflect the nature of their services and market conditions. Section 328(a), together with other provisions of the Bankruptcy Code, represent a rejection of the previously-existing standards of conservation of the estate and economy of administration, as Congress determined that those standards discouraged practitioners from entering the bankruptcy field and that estates were ill-served by less able bankruptcy specialists. See, e.g., In re Benassi, 72 B.R. 44, 47 (D. Minn. 1987). As one court explained it in affirming the approval of a professionals retention under section 328(a), [i]f the most competent professionals are to be available for complicated capital restructuring and the development of successful corporate reorganization, they must know what they will receive for their expertise and commitment. In re National Gypsum Co., 123 F.3d 861, 862-63 (5th Cir. 1997). Various bankruptcy courts have recognized the paramount importance of this pre-approval under section 328(a) and have approved the retention of investment bankers and similar
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professionals thereunder. See, e.g., In re Aloha Airlines, Inc., Case No. 08-00337 (LK) (Bankr. D. Haw. Apr. 7, 2008 (authorizing debtors to retain and employ Imperial on similar terms, including indemnification protection with exclusions in the case of bad faith, self-dealing, gross negligence or willful misconduct); In re Metabolife Intl, Inc., Case No. 05-06040 (JJH) (Bankr. S.D. Cal. Aug. 5, 2005) (authorizing debtors to employ financial advisor under sections 327 and 328 pursuant to retention agreement, which included broad indemnification protection except in the cases of gross negligence and willful misconduct; In re Flying J Inc., Case No. 08-13384 (MFW) (Bankr. D. Del. Apr. 3, 2009 (authorizing retention of a financial advisor on similar terms); In re Tronox Inc., Case No. 09-10156 (ALG) (Bankr. S.D.N.Y. Apr. 7, 2009 (same)]. Courts have examined section 328(a) retentions under a non-exclusive list of factors that may be considered depending on the circumstances, including, for example, (1) whether the terms of an engagement agreement reflect normal business terms in the marketplace; (2) the relationship between the Debtors and the professionals, i.e., whether the parties involved are sophisticated business entities with equal bargaining power who engage in an arms length negotiation; (3) whether the retention, as proposed, is in the best interests of the estate; (4) whether there is creditor opposition to the retention and retainer provisions; and (5) whether, given the size, circumstances and posture of the case, the amount of the retainer is itself reasonable, including whether the retainer provides the appropriate level of risk minimization, especially in light of the existence of any other risk-minimizing devices, such as an administrative order and/or a carve-out. In re Insilco Techs., Inc., 291 B.R. 628, 633 (Bankr. D. Del. 2003) (such list is not exclusive and not every factor will necessarily be of equal weight). Viewed in more general terms, [i]n deciding whether the terms of the professionals employment is reasonable, the court must consider whether the terms are fair to the professional, the debtor, and the creditors who must bear the expense. In re LTV Steel Company, Inc., 2001 U.S. Dist. Lexis 25338 (N.D. Ohio 2001). The Debtor and Imperial negotiated the terms of the Engagement Agreement in good faith and at arms length. Both the Debtor and Imperial are sophisticated business entities represented by counsel. The Debtor has previously engaged financial advisors before selecting Imperial, and , based on these experiences, the Debtor believes that the terms of the Engagement Agreement reflect
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normal business terms in the marketplace, are reasonable, and provides the appropriate level of risk minimization. As previously expressed, the Debtor believes the retention of an investment banker is necessary and appropriate in this chapter 11 case in order to enhance the value of the estate for the benefit of the creditors and equity security holders. C. Approval of Indemnification Provisions The Engagement Agreement provides for certain indemnification and related protections for Imperial (the Indemnification Provision). The Indemnification Provision is a customary and reasonable term of consideration for investment bankers such as Imperial for proceedings both out of court and in chapter 11 cases. The terms of the Engagement Agreement, including the Indemnification Provision, were fully negotiated between the Debtor and Imperial at arms length. Courts considering whether indemnification and similar provisions are reasonable under section 328(a) have concluded that, under the appropriate circumstances, such provisions may be approved; that is, there is not any categorical prohibition against such provisions.4 United Artists Theatre Company, 315 F.3d 217, 234 (3rd Cir. 2003), LTV Steel, 2001 U.S. Dist. Lexis 25338, at *8 (The Court finds that provisions for indemnification of professionals in bankruptcy cases are not prohibited if the terms are favorable or reasonable.); In re Joan and David Halpern Inc., 248 B.R. 43 (Bankr. S.D.N.Y. 2000); In re Baltimore Emergency Service II, LLC et al., 291 B.R. 382 (Bank. D. Md. 2003) (The indemnification of a financial advisor to a Chapter 11 debtor is not, per se, an unreasonable term of employment under 11 U.S.C. Section 328(a).); In re Comdisco, Inc., 2002 U.S. Dist. LEXIS 17994, *7 (N.D. Ill. Sept. 25, 2002) (Most of the courts addressing indemnity clauses for financial advisors have expressed reservations about them but have almost uniformly declined to impose a blanket prohibition against their use); In re Metricom, 275 B.R. 364, 371 (Bankr. N.D. Cal. 2002) (However, Houlihan is correct that the Code does not prohibit
Many of the reported cases do not distinguish between indemnification provisions and exculpation and similar or related provisions in their opinions. The Metricom court noted that indemnity or contribution and exculpation are different methods of reaching similar, but not identical results. 275 B.R. at 368 n.4. In general: indemnity means that if a third party sues a professional based on the professionals services to the client, the client will pay to defend the professional and will pay any judgment against the professional; contribution means that, if a third party sues both a professional and the professionals client based on the professionals services to the client, the client will contribute some or all of the professionals costs to defend and to satisfy any judgment against the professional; exculpation means that the client agrees not to sue the professional based on the professionals services to the client. Under each of these arrangements, the client bears some or all of the financial consequences for the professionals actions.
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indemnity/contribution or exculpation provisions, and that there is no statutory or binding bankruptcy case law basis upon which to establish a per se rule against such protections for professionals in bankruptcy cases.); In re Aloha Airgroup, Inc., 2005 Bankr. LEXIS 883, at *4-*5 (Bankr. D. Haw. Feb. 24, 2005). See also In re Protocol Srvcs., Inc., Case No. 05-06782 (JWM) (Bankr. S.D. Cal. Sept. 9, 2005) (approving debtors retention of financial advisors, which retention agreement included broad indemnification protection ( 6.1), excluding only cases of gross negligence or willful misconduct by financial advisors); In re American Restaurant Group, Inc., Case No. 04-30732 (TD) (Bankr. C.D. Cal. Nov. 19, 2004) (authorizing employment and indemnification of financial advisors other than for willful misconduct, fraud, bad faith or gross negligence ( 21 of agreement)); In re Bugle Boy Industries, Inc., Case No. 01-10834 (GM) (Bankr. C.D. Cal. March 7, 2001) (similar); In re Liberate Technologies, Case No. 04-31394 (TEC) (Bankr. N.D. Cal. June 28. 2004) (similar); In re RFB Cellular, Inc., Case No. 03-12187 (RR) (Bankr. C.D. Cal. Oct. 28, 2003) (similar); In re Aloha Airlines, Inc., Case No. 08-00337 (LK) (Bankr. D. Haw. Apr. 7, 2008) (authorizing debtors to indemnify Imperial, with exclusions only bad faith, selfdealing, gross negligence or willful misconduct). The court in Joan and David Halpern Inc. noted that the reluctance of several reported decisions to approve indemnification agreements stemmed from the presumed inability of a fiduciary to limit his liability for ordinary negligence. 248 B.R. at 45. The court noted, however, that [t]his principle is contrary to the common law of trusts to which we may look for guidance. (citations omitted). Id. The court went on to describe how a fiduciary5 may, in fact, be indemnified against its negligence under the common law of trusts and statutory provisions governing the indemnification of corporate officers. In concluding, the court reasoned: While the reaction of the courts in the few reported decisions are understandable, they are also visceral. They overlook the common law principles permitting indemnity of fiduciaries, and the idea that a fiduciary cannot be indemnified for negligence, or that such indemnification is contrary to public policy, is just plain wrong. The common law has carved out clear exceptions to indemnity, such as bad faith, breach of trust, dishonesty, self-dealing, and willful, reckless, or grossly negligent
The Debtor notes that some courts have held that financial advisors like Imperial are not fiduciaries to the debtor. See, e.g., United Artists, 315 F.3d at 230 n. 14.
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misconduct, leaving the rest to the parties agreement. In the context of this case, therefore, the appropriate inquiry is whether taken as a whole, the terms of the retention are fair and reasonable, and the retention is in the best interests of the estate. Id. at 47. The Northern District of Ohios decision in LTV Steel is also instructive. In LTV Steel, the debtors sought to retain Jay Alix and Associates (JA&A) as their financial advisors pursuant to an agreement which contained indemnification provisions. The bankruptcy court overruled the U.S. Trustees objection to the indemnification provisions and approved the debtors employment of JA&A. The District Court affirmed. In determining that the indemnification provisions were reasonable under section 328(a) the court reasoned: The record shows that JA&A always seeks indemnification provisions in its engagements. The engagements are high risk and complex and JA&A chooses not to accept the risk, Trans. Pg. 38-39. Twenty-six engagements were listed on a hearing exhibit, indemnification was not included in five of them. Trans. Pg. 41-42. JA&A refused to waive the indemnification provision in this case. Trans. Pg. 42. Mr. Bonsell, a JA&A official, testified that similar indemnification provisions are typically used by other turnaround professionals. Trans. Pg. 40. Without the indemnity provision the Debtors could not retain JA&A or would have to pay JA&As larger professional insurance premiums through higher fees. JA&A is a highly experienced turnaround professional familiar with the Debtors operations and whose employment would be beneficial. The indemnification provision in the Letter Agreement is fair and reasonable and retention of JA&A is in the best interest of the estate. 2001 U.S. Dist. Lexis 25338 at *10-11. See also Aloha Airgroup, 2005 Bankr. LEXIS 883, at *4-*5 ([T]he Waiver [eliminating the financial advisors potential liability to debtors other than for claims arising primarily from its gross negligence or willful misconduct] is a reasonable term of GCAs retention. GCA and the Debtors have established that such provisions are standard in the market for financial advisors in restructuring situations, that GCA ordinarily insists on including such provisions in its retention agreements that GCA would not accept the Debtors engagement without such provisions, that the Debtors probably could not retain a financial advisor without
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agreeing to terms like the Waiver, and that the Debtors absolutely require the assistance of a competent and experienced financial advisory firm such as GCA.). The Debtor submits that indemnifications provisions such as the ones included in the Engagement Agreement are standard in the market for financial advisors in restructuring situations. The Debtor does not believe that it could retain a competent and experienced investment banker without including such a provision in the Engagement Agreement. Imperial has advised the Debtor that such provisions are standard in the industry and that it would not accept the engagement without such a provision in the Engagement Agreement. The Debtor believes that the value of the estate will be substantially enhanced and it could not successfully move forward with its reorganization without the assistance of a skilled, highly respected national full-service investment bank such as Imperial. The Debtor submits, therefore, that the fee structure and other terms and conditions in the Engagement Agreement, including the indemnification related provisions, are fair and reasonable and satisfy the salient factors, and should accordingly be approved under section 328(a) of the Bankruptcy Code. IV. NOTICE Notice of this Application has been given to the following parties or, in lieu thereof, to their counsel, if known: (i) the Office of the United States Trustee; (ii) the Debtors prepetition and postpetition lender; (iii) the creditors appearing on the list filed in accordance with Rule 1007(d) of the Federal Rules of Bankruptcy Procedure; and (iv) those persons who have requested notice pursuant to Rule 2002 of the Federal Rules of Bankruptcy Procedure. The Debtor submits that, in light of the nature of the relief requested, no other or further notice need be given. V. NO PRIOR REQUEST No prior request for the relief sought in this Motion has been made to this Court or any other court. WHEREFORE, the Debtor respectfully requests that the Court enter an Order, substantially in the form annexed hereto as Exhibit B, (a) authorizing the Debtor to retain Imperial as their
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investment banker nunc pro tunc to the Petition Date, pursuant to the terms of the Engagement Agreement, and (b) granting such other and further relief as the Court deems just and proper. Dated: November 5, 2012 AMERICAN SUZUKI MOTOR CORPORATION
By: Name: Takashi Iwatsuki Title: Chairman of the Board
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Exhibit A Declaration of Marc A. Bilbao
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Richard M. Pachulski (CA Bar No. 90073) James I. Stang (CA Bar No. 94435) Dean A. Ziehl (CA Bar No. 84529) Linda F. Cantor (CA Bar No. 153762) Debra I. Grassgreen (CA Bar No. 169978) PACHULSKI STANG ZIEHL & JONES LLP 10100 Santa Monica Blvd., Suite 1300 Los Angeles, CA 90067-4114 Telephone: 310/277-6910 Facsimile: 310/201-0760 E-mail: rpachulski@pszjlaw.com jstang@pszjlaw.com dziehl@pszjlaw.com lcantor@pszjlaw.com dgrassgreen@pszjlaw.com Proposed Attorneys for Debtor and Debtor in Possession UNITED STATES BANKRUPTCY COURT CENTRAL DISTRICT OF CALIFORNIA SANTA ANA DIVISION In re: American Suzuki Motor Corporation,1 Debtor. Case No.: 12-_____ ( ) Chapter 11 DECLARATION OF MARC A. BILBAO IN SUPPORT OF THE DEBTORS APPLICATION FOR ORDER AUTHORIZING THE EMPLOYMENT AND RETENTION OF IMPERIAL CAPITAL, LLC, AS INVESTMENT BANKER TO THE DEBTOR, NUNC PRO TUNC TO THE PETITION DATE [NO HEARING REQUIRED UNLESS REQUESTED PER L.B.R. 2014-1(B)] I, Marc A. Bilbao, do state and declare as follows: 1. I am a managing director of Imperial Capital, LLC (Imperial) which maintains its
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principal offices at 2000 Avenue of the Stars, 9th Floor South, Los Angeles, California 90067. I am authorized to execute this declaration (the Declaration) on behalf of Imperial. Unless otherwise stated in this declaration, I have personal knowledge of the facts set forth herein. If I were called to
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testify as a witness in this matter, I could and would competently testify to each of the facts set forth 1 herein. 2 2. 3 an Order, Pursuant to 11 U.S.C. 327(a) and 328(a), Authorizing the Employment and Retention of 4 Imperial Capital, LLC as Investment Banker, Nunc Pro Tunc to the Petition Date (the 5 Application). I submit this Declaration in compliance with sections 105, 327, 328 and 1107(a) of 6 title 11 of the United States Code (the Bankruptcy Code) and to provide the disclosure required 7 under Rules 2014(a), 2016 and 5002 of the Federal Rules of Bankruptcy Procedure (the Bankruptcy 8 Rules). 9 3. 10 modification as additional information becomes available to Imperial, I intend to submit, or cause to
This declaration is being submitted in connection with the Debtors Application for
To the extent that any information disclosed herein requires amendment or
11 be submitted, a supplemental Declaration to the Court reflecting the same. 12

4. 13 14
The Debtor desires to retain and employ Imperial as investment banker for the
purposes of marketing the Debtors assets, nunc pro tunc to the Petition Date, pursuant to the terms of an Engagement Agreement, dated as of November 1, 2012 (the Engagement Agreement). A 15 true and correct copy of the Engagement Agreement is attached hereto as Exhibit 1. 16 IMPERIALS QUALIFICATIONS 17 5. 18 trading, a wide range of investment banking advisory, capital markets and restructuring services, and 19 institutional research. Imperials institutional sales and trading professionals service over 1,200 20 institutional accounts. Imperials investment banking professionals provide advisory services to 21 middle market corporations, institutional investors, and private equity funds. 22 6. 23 financially troubled companies in complex financial restructurings both in chapter 11 cases and in 24 out-of-court situations. Imperial is highly qualified to advise on strategic alternatives and its 25 professionals have extensive experience in deals involving complex financial and operational 26 restructurings. 27 28
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Imperial is a full-service investment bank offering sophisticated institutional sales and
In particular, Imperial and its professionals have extensive experience working with
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As an active bankruptcy and restructuring advisor with significant experience in a
variety of industries, Imperial is well-qualified to serve as investment banker to the Debtor. Imperial specializes in assisting and advising debtors, creditors, creditors committees, shareholders, 3 bondholders and other parties involved with financially distressed companies, both during and 4 outside of bankruptcy cases, and has served as investment bankers, financial and strategic advisors 5 for debtors, creditors, and other constituents in numerous chapter 11 cases. See, e.g., In re Specialty 6 Trust, Inc., et al., No. 10-51432 (GWZ) (Bankr. D. Nev. July 23, 2010) [Dkt No. 293], In re Mesa 7 Air Group, et al., No. 10-10018 (MG) (Bankr. S.D.N.Y. March 1, 2010) [Dkt. No. 372], In re 8 MagnaChip Semiconductor Finance Co., No. 09-12008 (PJW) (Bankr. D. Del. Sept. 10, 2009) [Dkt 9 No. 274], In re Monaco Coach Corp., No. 09-10750 (KJC) (Bankr. D. Del. April 9, 2009) [Dkt No. 10 132], In re Qimonda Richmond LLC, No. 09-10589 (MFW) (Bankr. D. Del. May 18, 2009) [Dkt No.
11 370], In re Landsource Communities Development LLC, No. 08-11111 (KJC) (Bankr. D. Del. Aug. 12
27, 2008) [Dkt No. 504], In re Aloha Airlines Inc., No. 08-00337 (LK) (Bankr. D. Haw. April 8, 13 2008) [Dkt No. 203], In re Movie Galley Inc., No. 07-33849 (DOT) (Bankr. E.D. Va. Nov. 27, 2007) 14 [Dkt No. 1016], In re Custom Food Products, Inc., No. 07-10495 (PJW) (Bankr. D. Del. June 14, 15 2007) [Dkt No. 307], and In re Mesaba Aviation, Inc., No. 05-39258 (GFK) (Bankr. D. Minn. June 16 8, 2005) [Dkt No. 641]. 17 8. 18 upon my experience working with companies in chapter 11 cases, that the Debtor requires the 19 service of a seasoned and experienced investment banker, and one that is familiar with the chapter 20 11 process. Additionally, by having an investment banker provide the services to be provided by 21 Imperial in this chapter 11 case, other professionals in this case and company officers who might 22 otherwise handle complex financial and financing matters will be able to focus better on their 23 respective competencies and their core tasks and efficiently and effectively advise in the 24 management of the Debtors business and operations and to facilitate a successful chapter 11 25 process. Imperial is well-qualified to provide the services being sought by the Debtor, and the 26 employment of Imperial under the terms contained in the Engagement Agreement will benefit the 27 Debtors estate and its reorganization efforts. 28
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In light of the size and complexity of this chapter 11 case, it is my opinion, based
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1 9. 2 consulting and advisory services as Imperial and the Debtor deem appropriate and feasible to advise 3 the Debtor in the course of this chapter 11 case. Specifically, Imperial will render various services 4 to the Debtor including, but not limited to, the following: 5 6 7 8 9 10
Pursuant to the terms of the Engagement Agreement, Imperial will provide such
(a) analysis of the Debtors business, operations, properties, financial condition, competition, forecast, prospects and management; (b) advising the Debtor on a proposed purchase price and form of consideration for the Transaction; (c) assisting the Debtor in developing, evaluating, structuring and negotiating the terms and conditions of a potential Transaction; (d) assisting the Debtor in the preparation of solicitation materials with respect to the Transaction and the Debtor (the Transaction Offering Materials) (e) identification of and contacting selected qualified buyers (Buyers) for the Transaction and furnishing them, on behalf of the Debtor, with copies of Offering Materials; (f) assisting the Debtor in arranging for potential Buyers to conduct due diligence investigations; and (g) providing such other financial advisory services with respect to the Debtors financial issues as may from time to time be agreed upon between the Debtor and Imperial. Compensation of Imperial for Services Rendered
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Imperials willingness to advise and assist the Debtor is contingent upon its ability to
be retained in accordance with the terms and conditions of the Engagement Agreement, including, without limitation, the indemnification provision contained in Schedule I to the Engagement 20 Agreement. 21 11. 22 generally charged by financial advisors of similar stature for comparable engagements, both in and 23 out of court and reflects a balance between a fixed fee, monthly fee and fees contingent on the 24 consummation and closing of the transactions contemplated by the Engagement Agreement. 25 12. 26 professional services rendered and reimbursement of expenses incurred in connection with this 27 chapter 11 case, subject to the Courts approval and in compliance with applicable provisions of the 28
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The proposed overall compensation structure is comparable to compensation
Except as described below, Imperial intends to apply for compensation for
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Bankruptcy Code, the Bankruptcy Rules, the Local Bankruptcy Rules for the Central District of 1 California (the Local Rules), any applicable guidelines (the Guidelines) established by the 2 United States Trustee for the Central District of California, and any other applicable procedures and 3 orders of the Court and consistent with the proposed compensation set forth in the Engagement 4 Agreement (the Compensation Structure), provided that Imperial and its professionals shall only 5 be required to provide a summary of the services rendered. 6 13. 7 the Debtor has agreed to pay Imperial the fees set forth in the Engagement Agreement (the Fee 8 Structure) in cash. The Fee Structure is summarized below: 9 10
As compensation for the services rendered pursuant to the Engagement Agreement,
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(a) A monthly financial advisory fee of $100,000 for a minimum of five months (the Monthly Advisory Fee), payable in advance, beginning as of the date of the Engagement Agreement and continuing until the Debtors emergence from chapter 11 proceedings or until the Engagement Agreement is earlier terminated pursuant to its terms. (b) In the event an auction is conducted where at least one party other than Suzuki Motor Corporation submits a competing bid, a transaction fee of $2,000,000 (the M&A Transaction Fee), payable upon consummation of the Transaction. A Transaction shall be deemed to have been consummated upon the earliest of any of the following events to occur: (i) the acquisition of a majority of the outstanding common stock of the Company by the Buyer; (ii) a merger or consolidation of the Company with or into the Buyer; (iii) the acquisition by the Buyer of substantially all of the Companys assets; or (iv) in the case of any other Transaction, the consummation thereof. (c) In addition, without regard to whether the Transaction is consummated or this Agreement expires or is terminated, all fees, disbursements and out-of-pocket expenses (the Expenses) incurred by Imperial in connection with the services to be rendered hereunder (including, without limitation, reasonable attorneys fees, travel and lodging expenses (including business class for any international travel), word processing charges, messenger services, duplicating services, facsimile expenses and other customary expenditures) shall be reimbursed to Imperial, or paid on behalf of Imperial, promptly as billed. Imperial shall be paid a cash deposit of $20,000 (the Deposit) against Expenses upon the execution of this Agreement. Any unused amounts of the Deposit will be returned to the Debtor upon demand. Further, the Debtor shall be responsible for all other expenses associated with the Transaction including, without limitation, its own accounting and attorneys fees, travel and lodging expenses, word processing charges, messenger services, duplicating services, facsimile expenses, printing costs and other expenditures. The Debtor acknowledges that it is customary for the Debtor to reimburse the potential Buyers for all out-of-pocket expenses (including, without limitation, reasonable attorneys fees) associated with pursuing and
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completing the Transaction. (d) As further consideration, the Debtor has agreed to the indemnification and other obligations set forth in Schedule I attached to the Engagement Agreement, which such Schedule is an integral part of the Engagement Agreement and is incorporated therein by reference. 14. None of the fees payable to Imperial pursuant to the Engagement Agreement
constitute a bonus or fee enhancement. 15. In connection with the execution of the Engagement Letter, Imperial received
$120,000 on account of the Monthly Advisory Fee for November 2012 and the Deposit. 16. Imperial does not customarily maintain detailed time records similar to those
customarily maintained by attorneys, and Imperials services would not be compensated by reference to the number of hours and the Engagement Agreement provides that Imperial shall receive, among other things, certain fixed fees as described above. 17. Further, given the nature of our work (among other things, our focus on beneficial
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transactions and their incentive to implement such transactions), financial advisors, investment bankers, and similar professionals do not customarily bill on an hourly basis (or other increment thereof). 18. In my opinion, based on my experience working in this industry, the Fee Structure
appropriately reflects the nature of the services to be provided by Imperial, is reasonable and comparable to compensation generally charged by financial advisors and investment banking firms of similar stature to Imperial and for comparable engagements, both in and out of bankruptcy proceedings, and reflects a balance between a fixed, monthly fee, and a deferred amount which is tied to the consummation and closing of the transactions and services contemplated by the Debtor and Imperial in the Engagement Agreement. 19. The hours worked, the results achieved, and the ultimate benefit to the Debtor for the
work performed by Imperial in connection with its engagement may vary and the Debtor and Imperial have taken this into account in setting the above fees. The Compensation Structure is consistent with Imperials normal and customary billing practices for cases of this size and complexity both in and out of bankruptcy proceedings which require the level of services to be provided. Imperials restructuring capabilities, mergers and acquisitions expertise as well as its
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capital raising experience, some or all of which may be required by the Debtor during the term of 1 Imperials engagement hereunder, were important factors to the Debtor in determining the 2 Compensation Structure. In my opinion based upon my experience in this industry, the ultimate 3 benefit of Imperials services to the Debtor cannot be measured by reference to the number of hours 4 expended by Imperials professionals in the performance of such services. 5 20. 6 Engagement Agreement are reasonable under the standards set forth in section 328(a) of the 7 Bankruptcy Code, given (i) the numerous issues Imperial may be required to address in the 8 performance of its services under the Engagement Agreement, (ii) Imperials commitment to the 9 variable level of time and effort necessary to address all such issues as they arise and (iii) the market 10 prices for Imperials services for engagements of this nature in both out-of-court and chapter 11
In my opinion, based upon my experience in this industry, the fee arrangements in the
11 contexts. Accordingly, Imperial and, upon information and belief, the Debtor believes the 12
Compensation structure is both reasonable and market-based and should be approved under section 13 328(a) of the Bankruptcy Code. 14 21. 15 in connection with services to be performed after the Petition Date, with any other person, other than 16 other principals and employees of Imperial, in accordance with section 504 of the Bankruptcy Code. 17 22. 18 the terms of the Engagement Agreement, the Debtor has agreed, among other things, to indemnify, 19 and provide contribution and reimbursement to, Imperial and certain related parties in accordance 20 with the provisions of the Indemnification Provision attached as Schedule I to the Engagement 21 Agreement. Such a provision is customary and reasonable for Imperials engagement. Unlike the 22 market for other professionals that the Debtor may retain, such provisions are standard terms of the 23 market for financial advisors and investment bankers. Imperial and, on information and belief, the 24 Debtor, believes that such provisions are comparable to those generally obtained by investment 25 banking and financial advisory firms of similar stature to Imperial and for comparable engagements, 26 both in and out of court. 27 28
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Imperial will not share or agree to share any compensation to be paid by the Debtor,
As stated previously, as part of the overall compensation payable to Imperial under
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1 23. 2 potential parties in interest that Imperial received from the Debtor (the Parties in Interest). 3 24. 4 Parties in Interest in connection with matters relating to the Debtor, its estate, assets or businesses 5 and will not represent other entities which are creditors of, or have other relationships to, the Debtor 6 in matters relating to the Debtor, its estate, assets or businesses. 7 25. 8 clients in the areas of restructuring and distressed debt, as well as non-distressed mergers and 9 acquisitions and capital raising situations. As a result, Imperial has represented, and may in the 10 future represent, certain Parties in Interest in matters unrelated to this chapter 11 case, either
In connection with the preparation of this Declaration, Imperial reviewed the list of
To the best of my knowledge and belief, Imperial has not represented any of the
Imperial provides financial advisory and investment banking services to an array of
11 individually or as part of representation of a committee of creditors or interest holders. 12

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To the best of my knowledge and belief, neither Imperial nor I, nor any other
employee of Imperial that will work on the Debtors engagement has any connection with or holds any interest adverse to the Debtor, its estate or the Parties in Interest in the matters on which 15 Imperial is proposed to be retained, except as otherwise set forth below: 16 17 18 19 20 21 22 23 24 25 26 27 28
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(a) Various departments within Imperial have numerous clients, past and present, which are located throughout the world, in a variety of industries. Such clients may include certain of the equity holders of the Debtor and certain of the persons or entities that are identified as creditors of the Debtor. Imperial or its affiliates may have investments in certain of the Debtors creditors and Imperials research department may have issued research covering some of the Debtors creditors, and may in the future issue research on additional creditors. The management of these investments and the direction of any Imperial research are not within my purview or the purview of Imperials corporate finance department. Nevertheless, insofar as I have been able to ascertain based on the results of the foregoing, to the best of my knowledge, Imperial has not advised any party in interest in connection with this chapter 11 case. (b) Imperial is a full service investment bank and has likely provided services unrelated to the Debtor for companies and individuals that have conducted business in the past and/or currently conduct business with the Debtor, and who may be creditors of the Debtor. To the best of my knowledge, information and belief, Imperials services to these parties were and are wholly unrelated to the Debtor, its estate or this chapter 11 case. (c) Imperial has current or prior banking or trading relationships with various entities, however, no current or prior relationship with any entity in this case involves activity related to the Debtor or their affiliated companies.
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(d) As part of its practice, Imperial appears in numerous cases, proceedings, and transactions involving many different professionals, some of which may represent claimants and parties in interest in the Debtors chapter 11 case. Furthermore, Imperial has in the past and will likely in the future be working with or against other professionals involved in this case in matters unrelated to this case. Based on my current knowledge of the professionals involved, and to the best of my knowledge and information, none of these business relationships represents an interest materially adverse to the Debtor herein in matters upon which Imperial is to be engaged. 27. If the Court approves Imperials retention, Imperial will not accept any engagement
or perform any service for any entity or person other than the Debtor in this chapter 11 case. Imperial will, however, continue to provide professional services to entities or persons that may be creditors or equity security holders of the Debtor or Parties in Interest in this chapter 11 case; provided that such services do not relate to, or have any direct connection with, this chapter 11 case or the Debtor. 28. Imperial and its affiliates may have and may continue to have investment banking and
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other relationships with parties other than the Debtor pursuant to which Imperial may acquire information of interest to the Debtor. Imperial shall have no obligation to disclose such information to the Debtor, or to use such information in connection with the matters set forth in Section 1 of the Engagement Agreement. 29. If any new relevant facts or relationships are discovered or arise during the pendency
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of this chapter 11 case, Imperial will use reasonable efforts to identify such further developments and will promptly file a supplemental affidavit as required by Bankruptcy Rule 2014. 30. Accordingly, except as otherwise set forth herein and Exhibit 2, insofar as I have
been able to determine, none of Imperial, I, nor any employee of Imperial who will work on the engagement holds or represents any interest adverse to the Debtor or its estate, and Imperial is a disinterested person as that term is defined in section 101(14) of the Bankruptcy Code, as modified by section 1107(b) of the Bankruptcy Code, in that Imperial, and its professionals and employees who will work on the engagement: (a) (b) (c) are not creditors, equity security holders, or insiders of the Debtor; were not, within two years before the date of filing of the Debtors chapter 11 petitions, a director, officer, or employee of the Debtor; and do not have an interest materially adverse to the interest of the Debtors estate or any class of creditors or equity security holders, by 9
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1 2 3 4 5 6 7 8 9 10
reason of any direct or indirect rela a ationship to, connection with or interest in the Debtor, o for any ot t or ther reason. I declare under penalt of perjury that the fore u ty y egoing is tru and correc to the bes of my ue ct, st know wledge. Dated this 5th day of Novem d mber, 2012.
I IMPERIAL CAPITAL, LLC B _______ By: __________ _________ Marc A. Bilbao, Title: M Managing Dir rector
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Exhibit 1 Engagement Agreement
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2000 Avenue of the Stars, 9th Floor South
Los Angeles, California 90067
TEL 310 246 3700
800 929 2299
FAX 310 246 3714
November 1, 2012
American Suzuki Motor Corporation 3251 East Imperial Highway Brea, CA 92821 Attention: Takashi Iwatsuki Chairman
Dear Mr. Iwatsuki: Pursuant to this letter agreement (this Agreement) American Suzuki Motor Corporation (together with its subsidiaries and affiliates, the Company) hereby engages Imperial Capital, LLC (Imperial Capital) as the exclusive financial advisor to the Company in connection with a potential transaction, which transaction may include a merger, consolidation, or any other business combination, in one or a series of transactions, or a purchase involving all or a substantial amount of the business, securities or assets of the Company, or one or more subsidiaries or divisions of the Company, or any transaction structured to substantially achieve the same result (each a Transaction). Section 1. Services to be Rendered. As advisor to the Company, Imperial Capital may perform the following services as may be requested by the Company: (i) analysis of the Companys business, operations, properties, financial condition, competition, forecast, prospects and management; (ii) advising the Company on a proposed purchase price and form of consideration for the Transaction; (iii) assisting the Company in developing, evaluating, structuring and negotiating the terms and conditions of a potential Transaction; (iv) assisting the Company in the preparation of solicitation materials with respect to the Transaction and the Company (the Transaction Offering Materials) (v) identification of and contacting selected qualified buyers (Buyers) for the Transaction and furnishing them, on behalf of the Company, with copies of Offering Materials; and (vi) assisting the Company in arranging for potential Buyers to conduct due diligence investigations; and (vii) providing such other financial advisory services with respect to the Companys financial issues as may from time to time be agreed upon between the Company and Imperial Capital. Section 2. Compensation. In consideration for the services to be provided under this Agreement, Imperial Capital shall be paid: (i) A financial advisory fee of $100,000 per month for a minimum of five months (the Monthly Advisory Fee), payable monthly in advance during the term of this Agreement. The first Monthly Advisory Fee shall be payable upon execution of this Agreement and each subsequent Monthly Advisory Fee shall be payable in advance on the first day of each month. If the first Monthly Advisory Fee is payable for a partial month, such first Monthly Advisory Fee shall be pro rated from the date hereof to the end of the month. (ii) In the event an auction is conducted where at least one party other than Suzuki Motor Corporation submits a competing bid, Imperial Capital will be due a transaction fee of $2,000,000 (the M&A Transaction Fee), payable in cash by wire directly from the financing source at closing. The M&A Transaction Fee shall be payable upon consummation of the Transaction. A Transaction shall be deemed to have been consummated upon the earliest of any of the following events to occur: (a) the acquisition of a majority of the outstanding common stock of the Company by the Buyer; (b) a merger or consolidation of the Company with or into the Buyer; (c) the acquisition by the Buyer of substantially all of the Companys assets; or (d) in the case of any other Transaction, the consummation thereof.
Imperial Capital, LLC
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American Suzuki Motor Corporation November 1, 2012 Page 2 of 7
If during the term of this Agreement, the scope of the engagement changes, for example, a financing engagement becomes a mergers and acquisitions engagement, if the compensation for the new engagement has not been agreed upon prior to closing, then the Company agrees to pay Imperial Capital the reasonable and customary fee for the type of engagement involved based upon market conditions and market rates at the time of the engagement. In addition, without regard to whether the Transaction is consummated or this Agreement expires or is terminated, all fees, disbursements and out-of-pocket expenses (the Expenses) incurred by Imperial Capital in connection with the services to be rendered hereunder (including, without limitation, reasonable attorneys fees, travel and lodging expenses (including business class for any international travel), word processing charges, messenger services, duplicating services, facsimile expenses and other customary expenditures) shall be reimbursed to Imperial Capital, or paid on behalf of Imperial Capital, promptly as billed. Imperial Capital shall be paid a cash deposit of $20,000 (the Deposit) against Expenses upon the execution of this Agreement. Any unused amounts of the Deposit will be returned to the Company upon demand. Further, the Company shall be responsible for all other expenses associated with the Transaction including, without limitation, its own accounting and attorneys fees, travel and lodging expenses, word processing charges, messenger services, duplicating services, facsimile expenses, printing costs and other expenditures. The Company acknowledges that it is customary for the Company to reimburse the potential Buyers for all out-of-pocket expenses (including, without limitation, reasonable attorneys fees) associated with pursuing and completing the Transaction. As further consideration, the Company agrees to the indemnification and other obligations set forth in Schedule I attached hereto, which such schedule is an integral part hereof and incorporated herein by reference. All fees and expenses payable to Imperial Capital pursuant to this Section 2 shall be payable in cash via wire transfer to an account designated by Imperial Capital. No fee paid or payable to Imperial Capital or any of its affiliates shall be credited against any other fee paid or payable to Imperial Capital or any of its affiliates. If the Company becomes a debtor under Chapter 11 (Chapter 11), Title 11 of the United States Code (the Bankruptcy Code) the Company shall promptly apply to the bankruptcy court having jurisdiction over the Chapter 11 bankruptcy case or cases of the Company (the Bankruptcy Court) for the approval of this Agreement and Imperial Capitals retention hereunder pursuant to sections 327 and 328 of the Bankruptcy Code and not subject to any other standard of review under Section 330 of the Bankruptcy Code. The Company shall supply Imperial Capital with a draft of such application and any proposed order authorizing Imperial Capitals retention that is proposed to be submitted to the Bankruptcy Court sufficiently in advance of its filing, to provide Imperial Capital with a reasonable opportunity to review and comment thereon. Imperial Capital shall have no obligation to provide any services under this Agreement if the Company becomes a debtor under the Bankruptcy Code unless Imperial Capitals retention is approved under Section 328(a) of the Bankruptcy Code, by a final order of the Bankruptcy Court no longer subject to appeal, rehearing, reconsideration or petition for certiorari, and which is acceptable to Imperial Capital. If the Company becomes a debtor under the Bankruptcy Code and Imperial Capitals engagement hereunder is approved by the Bankruptcy Court, the Company shall pay all fees and expenses of Imperial Capital hereunder as promptly as practicable in accordance with the terms hereof. Prior to commencing a Chapter 11 case, the Company shall pay all undisputed amounts theretofore due and payable to Imperial Capital in cash. Imperial Capital shall invoice the Company for fees and expenses under this Agreement in accordance with the fee procedures order entered by the Bankruptcy Court in the Chapter 11 bankruptcy cases of the Company. If the Company fails to pay Imperial Capital within thirty (30) days after receipt of any of Imperial Capitals invoices, in addition to other remedies that may be available at law or equity, Imperial Capital may stop work. All fees and expenses payable to Imperial Capital pursuant to this Section 2 shall be payable in cash via wire transfer to an account designated by Imperial Capital. No fee paid or payable to Imperial Capital or any of its affiliates shall be credited against any other fee paid or payable to Imperial Capital or any of its affiliates Section 3. Term and Scope of Engagement. The advisory services and compensation arrangements set forth herein do not encompass other investment banking services such as the raising of capital, the issuance of fairness opinions, or any other specific services not set forth in Section 1 hereof. The compensation arrangements pursuant to Section 2(i) hereof shall commence effective as of the date hereof and shall continue thereafter on a month-to-month basis pursuant to the terms hereof until the consummation of the Transaction. This Agreement may be terminated by either the Company or Imperial Capital
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upon thirty (30) days prior written notice. Upon any termination or expiration of this Agreement, Imperial Capital shall be entitled to receive prompt payment of all unpaid fees and expenses accrued pursuant to Section 2 hereof up to and including the date of such termination or expiration. Sections 2, 3, 5, 6, 9, 10 and 11 of this Agreement and the indemnity and other provisions contained in Schedule I shall remain operative and in full force and effect regardless of any termination or expiration of this Agreement. Notwithstanding the foregoing paragraph, if at any time prior to 24 months after the termination or expiration of this Agreement for any reason, the Company enters into any transaction or transactions similar to the Transaction contemplated by this Agreement (or any formal or informal agreement to consummate such transaction or transactions) and the Company consummates any such transaction or transactions, or any understanding, statement or letter of intent or agreement, whether binding or non-binding, and whether explicit or implicit, is entered into during such period which subsequently results in a consummated transaction, whether or not such consummated transaction occurs within such 24 month period, Imperial Capital shall, in each case, in addition to any expense reimbursement due, be entitled to payment in full of the compensation described in Section 2 of this Agreement with respect to such transaction or transactions. Section 4. Cooperation. To the extent possible, the Company shall: (i) furnish Imperial Capital with all current and historical financial and other information and data regarding the business and financial condition of the Company (Information) as Imperial Capital reasonably believes appropriate in connection with its services hereunder; (ii) provide Imperial Capital with access to the officers, directors, employees and professional advisors of the Company as Imperial Capital reasonably believes appropriate in connection with its services hereunder; and (iii) as applicable, furnish Imperial Capital with the Transaction Offering Materials. The Company agrees that it and its counsel will be solely responsible for ensuring that any Transaction Offering Materials comply in all respects with applicable law. The Company agrees that neither the Information nor Transaction Offering Materials will contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein not misleading in light of the circumstances under which they were made. The Company will promptly notify Imperial Capital if it learns of any material inaccuracy or misstatement in, or material omission from, any Information or Transaction Offering Materials theretofore delivered to Imperial Capital. The Company will also cause to be furnished to Imperial Capital at any closing of the Transaction, copies of such agreements, opinions, certificates and other documents delivered at the closing as Imperial Capital may reasonably request. The Company recognizes and confirms that Imperial Capital, in connection with performing its services hereunder: (i) will be relying without investigation upon information that is available from public sources and upon the Information and Transaction Offering Materials supplied to it by or on behalf of the Company; (ii) shall not in any respect be responsible for the accuracy or completeness of such public information, Information or and Transaction Offering Materials or have any obligation to verify the same; (iii) shall not conduct any appraisal of any assets of the Company; and (iv) may require that any and Transaction Offering Materials contain appropriate disclaimers consistent with the foregoing. Section 5. Confidentiality. The Company agrees that any reference to Imperial Capital in any release, communication, or other material is subject to Imperial Capitals prior written consent, which may be given or withheld in Imperial Capitals sole discretion. Any advice, written or oral, provided by Imperial Capital pursuant to this Agreement shall be treated by the Company as confidential, shall be solely for the information and assistance of the Company in connection with its consideration of the matters set forth in Section 1 hereof and shall not be used, circulated, quoted or otherwise referred to for any other purpose, nor shall it be filed with, included in or referred to, in whole or in part, in any registration statement, proxy statement, offering materials or other communication, whether written or oral, prepared, issued or transmitted by the Company or any of their affiliates, directors, officers, employees, agents or representatives, without, in each instance, Imperial Capitals prior written consent, which may be given or withheld in Imperial Capitals sole discretion; provided, however, that the foregoing shall not apply to any information which becomes publicly available other than as a result of the breach by the Company of the undertakings hereunder, or that which the Company is required to disclose by judicial or administrative process in connection with any action, suit, proceeding or claim. Section 6. Conflicts. The Company acknowledges that Imperial Capital and its affiliates may have and may continue to have investment banking and other relationships with parties other than the Company pursuant to which Imperial Capital may acquire information of interest to the Company. Imperial Capital shall have no obligation to disclose such information to the Company, or to use such information in connection with the matters set forth in Section 1 hereof. Notwithstanding the
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Companys obligation to pay the fees and expenses of Imperial Capital hereunder, to indemnify Imperial Capital and to provide Imperial Capital with Information, the Company recognizes that Imperial Capital is being engaged hereunder to provide the services described above only to the Company and is not acting as an agent or fiduciary of, and shall have no duties or liability to, the equity holders of the Company or any third party in connection with its engagement hereunder, all of which are hereby expressly waived. No one other than the Company is authorized to rely upon the engagement of Imperial Capital hereunder or any statements, advice or conduct by Imperial Capital. The Company acknowledges that Imperial Capital or its affiliates may, from time to time, quote a market in or make purchases or sales for their own accounts or the accounts of its brokerage customers in debt or equity securities of or claims against the Company and Imperial Capitals research department may express views or opinions with respect thereto. Imperial Capital has, and agrees to maintain, information barriers between Imperial Capitals corporate finance department and its sales and trading department and research department, pursuant to which Imperial Capitals corporate finance employees are prohibited from disclosing confidential information to Imperial Capitals sales and trading or research employees. Section 7. Public Announcements. Imperial Capital shall have the right to place announcements and advertisements in financial and other newspapers and journals, at its own expense, describing its services in connection with the Transaction and other services rendered pursuant to this Agreement. Section 8. Exclusivity. The Company agrees that no other financial advisor is or will be authorized by it during the term of this Agreement to perform the same services on its behalf of the type which Imperial Capital is authorized to perform hereunder. No fee payable to any other financial advisor either by the Company or any other entity shall reduce or otherwise affect the fees payable hereunder to Imperial Capital. Section 9. Entire Agreement; Severability; Amendments; Assignments. This Agreement constitutes the entire agreement among the parties hereto related to the subject matter hereof and supersedes all prior agreements or understandings related to the subject matter hereof. If any provision of this Agreement is determined to be invalid, unlawful or unenforceable in any respect, such determination shall not affect such provision in any other respect or any other provision of this Agreement, which shall remain in full force and effect. This Agreement may not be amended or otherwise modified or waived except by an instrument in writing duly executed by both Imperial Capital and the Company. No waiver by either party of any provision hereof shall be taken or held to be a waiver of any subsequent breach thereof. This Agreement may not be assigned by either party without the prior written consent of the other party. This Agreement shall be binding upon and inure to the benefit of the Company, Imperial Capital, each Indemnified Person (as defined in Schedule I hereto) and their respective permitted successors and assigns, and no other person or persons shall have the right to enforce the provisions hereof. Section 10. Governing Law; Forum. This Agreement shall be construed, interpreted, governed and applied in all respects in accordance with the internal laws of the State of New York, without giving effect to principles of conflicts of laws. Except for Indemnification claims under schedule I any controversy, claim or dispute relating to this Agreement shall be resolved by binding arbitration in accordance with the rules of the American Arbitration Association pursuant to arbitration conducted in New York County, New York. Judgment upon such arbitration may be entered in any court having jurisdiction thereof. With respect to claims for Indemnification under schedule I the parties hereby consent to the jurisdiction of any State or Federal Court located within the New York County, State of New York. The parties further acknowledge that they waive any right they have or may have to a trial by jury with regard to the claims of Indemnification provided under Schedule I. If any litigation or arbitration shall ensue among the parties in connection with this Agreement or arising out of Imperial Capitals engagement hereunder, the prevailing party shall be entitled to recover from the nonprevailing party or parties its reasonable attorneys fees and other costs and expenses in connection therewith. Section 11. Counterparts. This Agreement may be executed in one or more counterparts (including by facsimile), each of which shall constitute an original and all of which, when taken together, shall constitute one and the same instrument.
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Please confirm that the foregoing correctly sets forth our agreement by signing and returning to Imperial Capital the enclosed original copy of this Agreement. Very truly yours, IMPERIAL CAPITAL, LLC
By: _________________________ Name: Marc Bilbao Title: Managing Director Accepted and agreed as of the date first above written: AMERICAN SUZUKI MOTOR CORPORATION
By: Name: Takashi Iwatsuki Title: Chairman
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Schedule I This Schedule I is a part of and is incorporated into that certain letter agreement (the Agreement) dated November 1, 2012 by and among American Suzuki Motor Corporation (together with its subsidiaries and affiliates, the Company) and Imperial Capital, LLC (Imperial Capital). If the Company commences a case under title 11 of the United States Code, any and all obligations and agreements of the Company under this Schedule I shall be equally applicable to, and binding upon, each of the Companys bankruptcy estates and any chapter 7 trustee appointed in the Companys bankruptcy cases, in each such case to the extent applicable. Because Imperial Capital will be acting on behalf of the Company in connection with the services contemplated by the Agreement, and as part of the consideration for the agreement of Imperial Capital to furnish its services pursuant to the Agreement, the Company (the Indemnifying Party) agrees, jointly and severally, to indemnify and hold harmless Imperial Capital and its affiliates, and their respective officers, directors, partners, members, shareholders, employees, representatives, consultants, advisors and agents and each person, if any, who controls Imperial Capital or any of its affiliates within the meaning of the Securities Act of 1933, as amended, (Imperial Capital and each such other person being referred to as an Indemnified Person), to the full extent lawful, from and against all claims, liabilities, losses, damages and expenses, or actions in respect thereof, as incurred, based upon, related to, arising out of, or in connection with (i) actions taken or omitted to be taken by the Company and their affiliates, officers, directors, counsel, employees or agents, (ii) actions taken or omitted to be taken by any Indemnified Person pursuant to the terms of, or in connection with, the services rendered pursuant to the Agreement or in connection with any Transaction, or proposed transaction contemplated thereby or any Indemnified Persons role in connection therewith, and (iii) any untrue statement or alleged untrue statement of a material fact contained in any of the Information or Transaction Offering Materials (each as defined in the Agreement) or omission or alleged omission to state a material fact required to be stated therein to make the statements therein not misleading in light of the circumstances under which they were made, and shall reimburse each Indemnified Person promptly upon demand for any legal or other expenses (including, without limitation, fees and expenses of counsel) reasonably incurred by that Indemnified Person in connection with investigating, preparing to defend, defending against, or appearing as a third party witness, in connection with any such claims, liabilities, losses, damages, expenses or actions; provided, however, that the Indemnifying Party shall not be responsible for any claims, liabilities, losses, damages, expenses or actions of any Indemnified Person to the extent, and only to the extent, that it is determined in a final judgment (not subject to further appeal) by a court of competent jurisdiction that such claims, liabilities, losses, damages, expenses or actions resulted directly from the fraud, willful misconduct or gross negligence of the Indemnified Person. No Indemnified Person shall have any liability to the Company, or any of their respective affiliates, officers, directors, partners, members, shareholders, employees, representatives, consultants, advisors and agents in connection with the services rendered pursuant to the Agreement except to the extent, and only to the extent, that it is determined in a final judgment (not subject to further appeal) by a court of competent jurisdiction that such claims, liabilities, losses, damages, expenses or actions resulted directly from the fraud, willful misconduct or gross negligence of the Indemnified Person. Promptly upon receipt by an Indemnified Person of notice of any claim or the commencement of any action, if an indemnification claim in respect thereof is to be made against the Indemnifying Party, the Indemnified Person shall notify the Indemnifying Party in writing of the claim or commencement of such action; provided, however, that the failure to so notify shall not relieve the Indemnifying Party from any liability which it may have pursuant to this Schedule I except to the extent, and only to the extent, that it has been materially prejudiced by such failure to so notify; and, provided, further, that the failure to so notify shall not relieve the Indemnifying Party from any liability it may have to an Indemnified Person otherwise than pursuant to this Schedule I. If any such claim or action shall be brought against an Indemnified Person, the Indemnifying Party shall be entitled to participate therein and to assume the defense thereof at its expense with counsel reasonably satisfactory to the Indemnified Person. After notice from the Indemnifying Party to the Indemnified Person of its election to assume the defense of such claim or action, the Indemnifying Party shall not be liable to the Indemnified Person under this Schedule I for any legal or other expenses subsequently incurred by the Indemnified Person in connection with the defense thereof other than reasonable costs of investigation; provided, however, that any Indemnified Person shall have the right to employ separate counsel in any such action and to participate in the defense thereof; and, provided, further, that Indemnifying Party shall continue to be liable for the legal or other expenses incurred by the Indemnified Person in connection with the defense of such action if (i) the employment of such separate counsel has been specifically authorized by the Indemnifying Party in writing, (ii) such Indemnified Person shall have been advised by counsel that there may be one or more legal defenses available to it which
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are different from or in addition to those available to the Indemnifying Party and in the reasonable judgment of such counsel it is advisable for the Indemnified Person to employ separate counsel (in which case the Indemnifying Party shall not have the right to assume the defense of such action on behalf of the Indemnified Person), (iii) the use of counsel chosen by the Indemnifying Party to represent the Indemnified Person would, in the reasonable judgment of the Indemnified Person, present such counsel with a conflict of interest, or (iv) the Indemnifying Party has failed to assume the defense of such action and employ counsel reasonably satisfactory to the Indemnified Person, it being understood, however, that the Indemnifying Party shall not, in connection with any one such action or separate but substantially similar or related actions in the same jurisdiction arising out of the same general allegations or circumstances, be liable for the reasonable fees and expenses of more than one separate firm of attorneys at any time for all such Indemnified Persons. The Indemnifying Party shall not settle or compromise or consent to the entry of any judgment in or otherwise seek to terminate any pending or threatened action or claim in which any Indemnified Person is or could be a party and as to which indemnification or contribution has or could have been sought by such Indemnified Person pursuant to this Schedule I, unless such Indemnified Person has given its prior written consent to the settlement, compromise, consent or termination or such settlement, compromise, consent or termination includes an express complete and unconditional release of such Indemnified Person. In order to provide for just and equitable contribution, if any claim for indemnification with respect to claims, liabilities, losses, damages, expenses or actions in respect thereof covered by this Schedule I is found to be unenforceable in a final judgment (not subject to further appeal) by a court of competent jurisdiction or is otherwise unavailable or insufficient to hold harmless an Indemnified Person (except directly due to the fraud, willful misconduct or gross negligence of the Indemnified Person), then the Indemnifying Party shall, in lieu of indemnifying such Indemnified Person, contribute to the amount paid or payable by such Indemnified Person as a result of such claims, liabilities, losses, damages, expenses or actions in respect thereof, in such proportion as shall be appropriate to reflect the relative benefits received and relative fault of the Indemnifying Party on the one hand and the Indemnified Person on the other, as well as any other relevant equitable considerations. The relative fault shall be determined by reference to, among other things, whether any untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Indemnifying Party or by the Indemnified Person and the parties relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The Indemnifying Party agrees that it would not be just and equitable if contributions pursuant to this Schedule I were to be determined by pro rata allocation or by any other method of allocation that does not take into account the equitable considerations referred to herein. No person found liable for a fraudulent misrepresentation or omission shall be entitled to contribution from any person who is not also found liable for such fraudulent misrepresentation or omission. Notwithstanding the foregoing, the aggregate contribution of all Indemnified Persons with respect to such claims, liabilities, losses, damages, expenses or actions in respect thereof shall not exceed the amount of fees actually received by Imperial Capital for its services pursuant to the Agreement. The foregoing indemnity, contribution and expense reimbursement provisions are not exclusive and shall be in addition to any liability which the Indemnifying Party might otherwise have and shall not limit any rights or remedies which may otherwise be available at law or in equity to the Indemnified Persons. These indemnification provisions shall (i) remain operative and in full force and effect regardless of any termination or expiration of the Agreement; (ii) inure to the benefit of any successors, assigns, heirs or personal representative of any Indemnified Person; (iii) shall remain operative and in full force and effect regardless of any investigation made by or on behalf of any Indemnified Person, and (iv) shall be binding on any successor or assign of the Indemnifying Party and each of its successors or assigns.
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Exhibit 2 Parties in Interest
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November 2012 Schedule of Disclosed Matters Party Role
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Disclosure
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Auto Warehousing Company and certain of its affiliates in matters unrelated to the Debtors. No active engagement.
Auto Warehousing Company
300 Major Vendors (Based On Last 12 Months Spend)
Dinsmore & Shohl LLP
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Dinsmore & Shohl LLP and certain of its affiliates in matters unrelated to the Debtors. No active engagement.
FTI Consulting, Inc
Imperial Capital's Corporate Finance Department currently has or previously had relationships with FTI Consulting, Inc and certain of its affiliates in matters unrelated to the Debtors. No active engagement.
Garmin
Imperial Capital's Corporate Finance Department currently has or previously had relationships withGarmin International, which may be affiliated with Garmin, in matters unrelated to the Debtors. No active engagement.
J D Power & Associates
Imperial Capital's Corporate Finance Department currently has or previously had relationships with J D Power & Associates and certain of its affiliates in matters unrelated to the Debtors. No active engagement.
Kenwood USA Corporation
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Kenwood which may be affiliated with Kenwood USA Corporation, in matter unrelated to the Debtors. No active engagement. No active engagement.
Marsh Usa, Inc
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Marsh Usa, Inc and certain of its affiliates in matters unrelated to the Debtors. No active engagement.
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Disclosure
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Nelson Mullins Riley & Scarbor, which may be affiliated with Nelson Mullins Riley & Scarborough in matters unrelated to the Debtors. No active engagement.
Nelson Mullins Riley & Scarborough, LLP
Oracle America, Inc.
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Oracle which may be affiliated with Oracle America, Inc in matters unrelated to the Debtors. No active engagement.
PriceWaterhouseCoopers
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Pricewaterhousecoopers and certain of its affiliates in matters unrelated to the Debtors. No active engagement.
ROI
Imperial Capital's Corporate Finance Department currently has or previously had relationships with ROI which may be affiliated with ROI Acquisition Group in matters unrelated to the Debtors. No active engagement.
Southern California Edison Co.
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Southern California Edison Co. and certain of its affiliates in matters unrelated to the Debtors. No active engagement.
United Parcel Service
Imperial Capital's Corporate Finance Department currently has or previously had relationships with United Parcel Service and certain of its affiliates in matters unrelated to the Debtors. No active engagement.
US Bank
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Us Bank and certain of its affiliates in matters unrelated to the Debtors. No active engagement. US Bank and certain of its affiliates may be clients of the firm's Sales and Trading Department and periodically buy and sell securities through Imperial Capital as their broker dealer.
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Disclosure
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Wachovia Capital Finance, which may be affiliated with Wachovia Management Corporation, in matters unrelated to the Debtors. No active engagement.
Wachovia Management Corporation
Wells Fargo
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Wells Fargo and certain of its affiliates in matters unrelated to the Debtors. No active engagement. Wells Fargo and certain of its affiliates may be clients of the firm's Sales and Trading Department and periodically buy and sell securities through Imperial Capital as their broker dealer.
Winston & Strawn LLP
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Winston & Strawn LLP and certain of its affiliates in matters unrelated to the Debtors. No active engagement.
ALLY Bank
300 Major Vendors (based on last 12mths spend)
Imperial Capital's Research Department has published research on Ally Financial Inc., which may be affiliated with ALLY Bank. Imperial Capital's Sales and Trading Department is a market maker in the securities of Ally Financial Inc., which may be affiliated with ALLY Bank. Imperial Capital's Corporate Finance Department currently has or previously had relationships with Bank of America and certain of its affiliates in matters unrelated to the Debtors. No active engagement. The Firm's Sales and Trading Department has a relationship with Bank of America Merrill Lynch, which may be affiliated with Bank of America, and may periodically buy and sell securities as their broker dealer. Bank of America Merrill Lynch, which may be affiliated with Bank of America, is, or has been, a vendor to Imperial Capital in matters unrelated to the Debtors. Imperial Capital's Corporate Finance Department currently has or previously had relationships with BBVA Compass and certain of its affiliates in matters unrelated to the Debtors. No active engagement. The Firm's Sales and Trading Department has a relationship with BBVA Gestion AM and BBVA ALM Madrid Bank, which may be affiliated with BBVA Compass, and may periodically buy and sell securities as their broker dealer.
Bank of America
BBVA Compass
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Disclosure
Cornerstone USA
The Firm's Sales and Trading Department has a relationship with Cornerstone Investment Partners, which may be affiliated with Cornerstone USA, and may periodically buy and sell securities as their broker dealer.
Federal Express Group
Federal Express and certain of its affiliates are, or have been, a vendor to Imperial Capital in matters unrelated to the Debtors.
FEDEX Freight West
Federal Express, which may be affiliated with Fedex Freight West, currently is, or has been, a vendor to Imperial Capital in matters unrelated to the Debtors.
GE Commercial Distribution Finance
Imperial Capital's Corporate Finance Department currently has or previously had relationships with GE Commercial Finance, which may be affiliated with GE Commercial Distribution Finance, in matters unrelated to the Debtors. No active engagement. The Firm's Sales and Trading Department has a relationship with GE Capital and GE Asset Management, which may be affiliated with GE Commercial Distribution Finance, and may periodically buy and sell securities as their broker dealer.
GE Money Bank
Imperial Capital's Corporate Finance Department currently has or previously had relationships with GE Commercial Finance, which may be affiliated with GE Money Bank, in matters unrelated to the Debtors. No active engagement. The Firm's Sales and Trading Department has a relationship with GE Capital and GE Asset Management, which may be affiliated with GE Money Bank, and may periodically buy and sell securities as their broker dealer.
General Motors LLC
Imperial Capital's Corporate Finance Department currently has or previously had relationships with General Motors LLLC and certain of its affiliates in matters unrelated to the Debtors. No active engagement. General Motors LLC and certain of its affiliates may be clients of the firm's Sales and Trading Department and periodically buy and sell securities through Imperial Capital as their broker dealer.
4 of 13

Desc
Disclosure
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Insight Investments, LLC and certain of its affiliates in matters unrelated to the Debtors. No active engagement. Insight Investment, LLC and certain of its affiliates may be clients of the firm's Sales and Trading Department and periodically buy and sell securities through Imperial Capital as their broker dealer.
Insight Investment, LLC
JP Morgan Chase
Imperial Capital's Corporate Finance Department currently has or previously had relationships with JP Morgan Chase and certain of its affiliates in matters unrelated to the Debtors. No active engagement. JP Morgan Chase and certain of its affiliates may be clients of the firm's Sales and Trading Department and periodically buy and sell securities through Imperial Capital as their broker dealer.
PNC Bank
Imperial Capital's Corporate Finance Department currently has or previously had relationships with PNC Bank and certain of its affiliates in matters unrelated to the Debtors. No active engagement. PNC Bank and certain of its affiliates may be clients of the firm's Sales and Trading Department and periodically buy and sell securities through Imperial Capital as their broker dealer.
Sovereign Bank
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Sovereign Bankcorp, which may be affiliated with Sovereign Bank, in matters unrelated to the Debtors. No active engagement. The Firm's Sales and Trading Department has a relationship with Sovereign Bankcorp, which may be affiliated with Sovereign Bank, and may periodically buy and sell securities as their broker dealer.
Sun Life Assurance Company of Canada
The Firm's Sales and Trading Department has a relationship with Sun Life Assurance, which may be affiliated with Sun Life Assurance Company of Canada, and may periodically buy and sell securities as their broker dealer.
5 of 13

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Disclosure
Sun Trust Bank
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Sun Trust Bank and certain of its affiliates in matters unrelated to the Debtors. No active engagement. The Firm's Sales and Trading Department has relationships with Sun Trust Private Wealth and Sun Trust Global Bank, which may be affiliated with Sun Trust Bank, and may periodically buy and sell securities as their broker dealer.
U.S. Bank National Association
Imperial Capital's Corporate Finance Department currently has or previously had relationships with U.S. Bank National Association and certain of its affiliates in matters unrelated to the Debtors. No active engagement. U.S. Bank National Association and certain of its affiliates may be clients of the firm's Sales and Trading Department and periodically buy and sell securities through Imperial Capital as their broker dealer. Imperial Capital's Corporate Finance Department currently has or previously had relationships with Bank of America and certain of its affiliates in matters unrelated to the Debtors. No active engagement. The Firm's Sales and Trading Department has a relationship with Bank of America Merrill Lynch, which may be affiliated with Bank of America, and may periodically buy and sell securities as their broker dealer. Bank of America Merrill Lynch, which may be affiliated with Bank of America, is, or has been, a vendor to Imperial Capital in matters unrelated to the Debtors.
Bank of America
Beneficiaries & Issuers of Letters of Credit
Union Bank
Beneficiaries & Issuers of Letters of Credit
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Union Bank and certain of its affiliates in matters unrelated to the Debtors. No active engagement. Union Bank and certain of its affiliates may be clients of the firm's Sales and Trading Department and periodically buy and sell securities through Imperial Capital as their broker dealer.
FedEx Freight - East
Common Carriers & Warehousemen to the Debtors
Federal Express, which may be affiliated with FedEx Freight-East, currently is, or has been, a vendor to Imperial Capital in matters unrelated to the Debtors.
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Disclosure
FedEx Freight - West
Federal Express, which may be affiliated with FedEx Freight-West, currently is, or has been, a vendor to Imperial Capital in matters unrelated to the Debtors.
FedEx Parcel
Federal Express, which may be affiliated with FedEx Parcel, currently is, or has been, a vendor to Imperial Capital in matters unrelated to the Debtors.
FedEx Trade Networks
Federal Express, which may be affiliated with FedEx Trade Networks, currently is, or has been, a vendor to Imperial Capital in matters unrelated to the Debtors.
Dan Williams
Current Officers & Directors
Imperial Capital's Corporate Finance Department currently has or previously had relationships with a Mr. Dan Williams, who, to the best of our knowledge, is affiliated with Verdisys, and certain of its affiliates in matters unrelated to the Debtors. No active engagement.
Ken Bush
Imperial Capital's Corporate Finance Department currently has or previously had relationships a Mr. Ken Bush, who, to the best of our knowledge, is affiliated with Parallel Technology, in matters unrelated to the Debtors. No active engagement.
Kevin Burns
Imperial Capital's Corporate Finance Department currently has or previously had a relationship with a Mr. Kevin Burns, who, to the best of our knowledge, is affiliated with either Lazard Technology Partners and/or TPG Growth, in matters unrelated to the Debtors. No active engagement. Imperial Capital's Corporate Finance Department currently has or previously had relationships with Bank of America and certain of its affiliates in matters unrelated to the Debtors. No active engagement. The Firm's Sales and Trading Department has a relationship with Bank of America Merrill Lynch, which may be affiliated with Bank of America, and may periodically buy and sell securities as their broker dealer. Bank of America Merrill Lynch, which may be affiliated with Bank of America, is, or has been, a vendor to Imperial Capital in matters unrelated to the Debtors.
Bank of America
Debtors Current & Former Depository Inst. Where Debtors Maintain Accts
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Disclosure
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Bank of the West and certain of its affiliates in matters unrelated to the Debtors. No active engagement. Bank of the West and certain of its affiliates may be clients of the firm's Sales and Trading Department and periodically buy and sell securities through Imperial Capital as their broker dealer.
Bank of the West
Mizuho
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Mizuho and certain of its affiliates in matters unrelated to the Debtors. No active engagement. Mizuho Bank and Mizuho Bank London, which may be affiliated with Mizuho, may be clients of the firm's Sales and Trading Department and periodically buy and sell securities through Imperial Capital as their broker dealer.
Union Bank of California
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Union Bank of California and certain of its affiliates in matters unrelated to the Debtors. No active engagement. Union Bank of California and certain of its affiliates may be clients of the firm's Sales and Trading Department and periodically buy and sell securities through Imperial Capital as their broker dealer.
Sumitomo Mitsui Bank
Debtors Current And Former Depository Institutions Where Debtors Maintain Accounts
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Sumitomo Bank of California, which may be affiliated with Sumitomo Mitsui Bank, in matters unrelated to the Debtors. No active engagement.
John Walsh
Former Officer & Directors (1yr)
A Mr. John Walsh who, to the best of our knowledge, is affiliated with Guggenheim Investment Partners, may be a client of the firm's Sales and Trading Department and may periodically buy and sell securities through Imperial Capital as their broker dealer.
Mark S. Wallace
Judges And Court Personnel In Santa Ana
Imperial Capital's Corporate Finance Department currently has or previously had relationships with a Mr. Mark Wallace, who, to the best of our knowledge, is affiliated with Stutman Treister & Glatt, in matters unrelated to the Debtors. No active engagement.
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Disclosure
Imperial Capital's Corporate Finance Department currently has or previously had relationship with a Mr. Scott Clarkson, who, to the best of our knowledge, is affiliated with Clarkson, Gore and Marsella, in matters unrelated to the Debtors. No active engagement.
Scott C. Clarkson
Judges And Court Personnel In Santa Ana
Chubb/Federal Insurance
Major Insurere & Insurance Brokers
Chubb/Federal Insurance and certain of its affiliates are, or have been, a vendor to Imperial Capital in matters unrelated to the Debtors.
Aetna
Major Third Party Administrators
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Aetna and certain of its affiliates in matters unrelated to the Debtors. No active engagement.
Automatic Data Processing, Inc.
Automatic Data Processing, Inc. and certain of its affiliates are, or have been, a vendor to Imperial Capital in matters unrelated to the Debtors.
Kaiser Permanente
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Kaiser Group Holdings, which may be affiliated with Kaiser Permanente in matters unrelated to the Debtors. No active engagement.
Lincoln Financial
The Firm's Sales and Trading Department has a relationship with Lincoln Capital, which may be affiliated with Lincoln Financial, and may periodically buy and sell securities as their broker dealer.
Brian Sullivan
Parties To Litigation Defendants And Defendant Attorneys
Imperial Capital's Corporate Finance Department currently has or previously had a relationship with a Mr. Brian Sullivan, who, to the best of our knowledge, is affiliated with Sterilmed & Bryan, in matters unrelated to the Debtors. No active engagement. A Mr. Brian Sullivan, who, to the best of our knowledge, is affiliated with Lord Abbett, may be a client of the Firm's Sales and Trading Department and may periodically buy and sell securities through Imperial Capital as their broker dealer.
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Disclosure
Principal Financial Group, Inc.
Parties To Litigation Defendants And Defendant Attorneys
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Principal Financial Group, Inc. and certain of its affiliates in matters unrelated to the Debtors. No active engagement. Principal Life Insurance Company, which may be affiliated with Principal Financial Group, Inc., may be clients of the firm's Sales and Trading Department and may periodically buy and sell securities through Imperial Capital as their broker dealer. Principal Life Insurance Company, which may be affiliated with Principal Financial Group, Inc., are, or have been, a vendor to Imperial Capital in matters unrelated to the Debtors.
Jeffrey & Marlys Cook
Parties to Litigation - Plaintiffs & Plaintiff Attorneys
A Mr. Jeffrey Cook who, to the best of our knowledge, is affiliated with Metropolitan West Asset Management, may be a client of the Firm's Sales and Trading Department and may periodically buy and sell securities Imperial Capital as their broker dealer.
James E. Cooper
Parties To Litigation Plaintiffs And Plaintiff Attorneys
Imperial Capital's Corporate Finance Department currently has or previously had relationships with a Mr. James Cooper, who, to the best of our knowledge, is affiliated with either Thompson Street Cap and/or Maxware, in matters unrelated to the Debtors. No active engagement.
Jim Ward
Imperial Capital's Corporate Finance Department currently has or previously had relationships a Mr. Jim Ward, who, to the best of our knowledge, is affiliated with either Merill Lynch and/or Davisco Foods International, in matters unrelated to the Debtors. No active engagement.
Robert A. Lee, Jr.
Imperial Capital's Corporate Finance Department currently has or previously had relationships with a Mr. Robert Lee, who, to the best of our knowledge, is affiliated with New Stream Capital, in matters unrelated to the Debtors. No active engagement. A Mr. Robert Lee, who, to the best of our knowledge, is affiliated with either SAC Capital, Fidelity, Canaccord and/or Diamondback, may be a client of the firm's Sales and Trading Department and periodically buy and sell securities through Imperial Capital as their broker dealer.
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Disclosure
Imperial Capital's Corporate Finance Department currently has or previously had relationships with William Smith, who, to the best of our knowledge, is affiliated with Bracken Operating, in matters unrelated to the Debtors. No active engagement.
William Smith
Young Conaway Stargatt & Taylor, LLP
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Young Conaway Stargatt & Taylor, LLP and certain of its affiliates in matters unrelated to the Debtors. No active engagement.
Baker & Hostetler LLP
Professional Service Providers To The Debtors
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Baker & Hostetler LLP and certain of its affiliates in matters unrelated to the Debtors. No active engagement.
Bracewell & Giuliani LLP
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Bracewell & Giuliani LLP in matters unrelated to the Debtors. No active engagement.
Buchanan, Ingersoll & Rooney,
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Buchanan, Ingersoll & Rooney in matters unrelated to the Debtors. No active engagement.
Dinsmore & Shohl LLP
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Dinsmore & Shohl LLP in matters unrelated to the Debtors. No active engagement.
Kirkland & Ellis
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Kirkland & Ellis in matters unrelated to the Debtors. No active engagement.
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Disclosure
KPMG, LLP
Imperial Capital's Corporate Finance Department currently has or previously had relationships with KPMG, LLP in matters unrelated to the Debtors. No active engagement.
McGuireWoods
Imperial Capital's Corporate Finance Department currently has or previously had relationships with McGuireWoods in matters unrelated to the Debtors. No active engagement.
Nelson Mullins Riley & Scarborough, LLP
Professional Service Providers to the Debtors
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Nelson Mullins Riley & Scarbor, which may be affiliated with Nelson Mullins Riley & Scarborough in matters unrelated to the Debtors. No active engagement.
PriceWaterhouseCoopers
Imperial Capital's Corporate Finance Department currently has or previously had relationships with PriceWaterhouseCoopers in matters unrelated to the Debtors. No active engagement.
Stradling Yocca Carlson & Raut
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Stradling Yocca Carlson & Raut in matters unrelated to the Debtors. No active engagement.
Winston & Strawn LLP
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Winston & Strawn LLP in matters unrelated to the Debtors. No active engagement.
DTE Energy
Significant Utilities
Imperial Capital's Corporate Finance Department currently has or previously had relationships with DTE Energy Trading, which may be affiliated with DTE Energy, in matters unrelated to the Debtors. No active engagement.
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Disclosure
Southern California Edison Co.
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Southern California Edison Co. and certain of its affiliates in matters unrelated to the Debtors. No active engagement.
UGI Utilities, Inc
Imperial Capital's Corporate Finance Department currently has or previously had relationships with UGI, which may be affiliated with UGI Utilities, in matters unrelated to the Debtors. No active engagement.
Akamai Technologies Inc
Top Unsecured Creditors (50 Largest Unpaid As Of 10-16-2012)
Imperial Capital's Corporate Finance Department currently has or previously had relationships with Akamai, which may be affiliated with Akamai Technologies Inc, in matters unrelated to the Debtors. No active engagement. No active engagement.
AT&T
Vendor
AT&T and certain of its affiliates are, or have been, a vendor to Imperial Capital in matters unrelated to the Debtors.
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Case 8:12-bk-22808-CB
Desc
Exhibit B Proposed Order
DOCS_LA:259930.2 12832/001
Case 8:12-bk-22808-CB
Desc
1 2 3 4 5 6 7 8 9 10
Richard M. Pachulski (CA Bar No. 90073) James I. Stang (CA Bar No. 94435) Dean A. Ziehl (CA Bar No. 84529) Linda F. Cantor (CA Bar No. 153762) Debra I. Grassgreen (CA Bar No. 169978) PACHULSKI STANG ZIEHL & JONES LLP 10100 Santa Monica Blvd., Suite 1300 Los Angeles, CA 90067-4114 Telephone: 310/277-6910 Facsimile: 310/201-0760 E-mail: rpachulski@pszjlaw.com jstang@pszjlaw.com dziehl@pszjlaw.com lcantor@pszjlaw.com dgrassgreen@pszjlaw.com Proposed Attorneys for Debtor and Debtor in Possession UNITED STATES BANKRUPTCY COURT CENTRAL DISTRICT OF CALIFORNIA SANTA ANA DIVISION In re: American Suzuki Motor Corporation,1 Debtor. ORDER GRANTING DEBTORS APPLICATION FOR AN ORDER, PURSUANT TO 11 U.S.C. 327(a) AND 328(a), AUTHORIZING EMPLOYMENT AND RETENTION OF IMPERIAL CAPITAL, LLC AS INVESTMENT BANKER, NUNC PRO TUNC TO THE PETITION DATE Case No.: 12-_____ ( ) Chapter 11
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Upon the application (the Application)2 of the above-captioned debtor (the Debtor) for entry of an order (the Order) pursuant to sections 327(a) and 328(a) of the Bankruptcy Code, and Bankruptcy Rule 2014, authorizing the Debtors to employ and retain Imperial Capital, LLC (Imperial) as investment banker for the Debtor nunc pro tunc to the Petition Date on the terms set forth in the Engagement Agreement between the Debtor and Imperial, and attached indemnification
The last four digits of the Debtors federal tax identification number are (8739). The Debtors address is: 3251 East Imperial Highway, Brea, CA 92821. 2 Capitalized terms used but not defined herein shall have the meanings ascribed to such terms in the Application.
DOCS_LA:259930.2 12832/001
1
Case 8:12-bk-22808-CB
Desc
1 2 3 4 5 6 7 8 9 10
provision (the Indemnification Provision); and upon consideration of the Declaration of Marc A. Bilbao in Support of the Application, and the Court being satisfied that the relief requested herein and the employment of Imperial is necessary and in the best interests of the Debtors estate, its creditors, and other parties in interest; and the Court being satisfied that the terms of the Engagement Agreement, are reasonable terms for purposes of section 328(a) of the Bankruptcy Code; and the Court having jurisdiction over this matter pursuant to 28 U.S.C. 1334; and it appearing that this proceeding is a core proceeding pursuant to 28 U.S.C. 157(b)(2); and it appearing that venue of this proceeding is proper pursuant to 28 U.S.C 1408 and 1409; and the Court being satisfied that notice of this Application and opportunity for a hearing on this Application was appropriate under the particular circumstances and that no other or further notice need be given; and the Court being satisfied that Imperial neither holds nor represents any interest adverse to the Debtors estate with respect to the matters upon which it is to be employed; and the Court being satisfied that Imperial is a disinterested person, as that term is defined in section 101(14) of the Bankruptcy Code; and after due deliberation and sufficient cause appearing therefore, it is hereby ORDERED that the Application is granted as provided herein, effective as of the Petition Date; ORDERED that the Debtor is authorized to retain Imperial as their investment banker effective as of the Petition Date, pursuant to sections 327(a) and 328(a) of the Bankruptcy Code and Bankruptcy Rule 2014(a), on the terms set forth in this Order, the Engagement Agreement, and its Indemnification Provisions; ORDERED that the terms of Imperials compensation set forth in the Engagement Agreement, including without limitation, the Monthly Advisory Fee, M&A Transaction Fee and Expenses (all as defined in the Engagement Agreement) are approved pursuant to section 328(a) of the Bankruptcy Code; ORDERED that Imperial shall be compensated in accordance with the terms described in the Engagement Agreement, pursuant to the standard of review under section 328(a) of the Bankruptcy Code and such compensation shall not be subject to review under section 330 of the Bankruptcy Code; provided, however, that such compensation shall be subject to the approval of this
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DOCS_LA:259930.2 12832/001
Case 8:12-bk-22808-CB
Desc
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Court, the Bankruptcy Code, the Bankruptcy Rules, the Local Bankruptcy Rules for the Central District of California, any applicable guidelines established by the U.S. Trustee, and any other applicable procedures and orders of the Court for all services performed and expenses incurred after the Petition Date; provided, further, that Imperial is hereby relieved of the obligation to record its time on an hourly basis or in other increments thereof. None of the fees payable to Imperial pursuant to the Engagement Agreement, as modified hereby, shall constitute a bonus or fee enhancement under applicable law; ORDERED that, pursuant to the terms of the Engagement Agreement, Imperial is entitled to reimbursement periodically and upon request from the Debtor and in accordance with the interim compensation procedures order entered by the Bankruptcy Court in this chapter 11 case, for reasonable expenses incurred in connection with the performance of its engagement under the Engagement Agreement, including, without limitation, the fees, disbursement and other charges of Imperials counsel (which counsel shall not be required to be retained pursuant to section 327 of the Bankruptcy Code or otherwise but whose fees shall be subject to review by the Bankruptcy Court pursuant to section 330 of the Bankruptcy Code); ORDERED that the Debtor shall not seek to avoid, recharacterize, recover or subordinate pursuant to the Bankruptcy Code or any applicable nonbankruptcy law, any portion of any amounts paid by the Debtor pursuant to the Engagement Agreement, as modified hereby, except as otherwise ordered by the Court; ORDERED that the Indemnification Provision attached as Schedule 1 to the Engagement Agreement is approved; ORDERED that the terms and conditions of this Order be immediately effective and enforceable upon its entry; ORDERED that this Order shall be binding on the Debtor and any successor thereto (including, without limitation, any trustee or examiner appointed or elected under chapter 7 or chapter 11 of the Bankruptcy Code in any of the Debtors case) in all circumstances;
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DOCS_LA:259930.2 12832/001
Case 8:12-bk-22808-CB
Desc
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ORDERED that to the extent that there may be any inconsistency between the terms of the Application, the Engagement Agreement, the Indemnification Agreement or this Order, the terms of this Order shall govern; ORDERED that notice of the Application is deemed good and sufficient; ORDERED that the Debtor is authorized, empowered, and directed to take all actions necessary to implement the relief granted pursuant to this Order; and ORDERED that during the pendency of this case, the Court hereby retains jurisdiction to hear and determine all matters arising from or related to the implementation, interpretation and/or enforcement of the Engagement Agreement and this Order. ###
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By: Name: Takashi Iwatsuki Title: Chairman of the Board

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Exhibit A Declaration of Marc A. Bilbao

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To the extent that any information disclosed herein requires amendment or

11 be submitted, a supplemental Declaration to the Court reflecting the same. 12

Imperial is a full-service investment bank offering sophisticated institutional sales and

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As an active bankruptcy and restructuring advisor with significant experience in a

The proposed overall compensation structure is comparable to compensation

Except as described below, Imperial intends to apply for compensation for

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As compensation for the services rendered pursuant to the Engagement Agreement,

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As stated previously, as part of the overall compensation payable to Imperial under

Imperial provides financial advisory and investment banking services to an array of

11 individually or as part of representation of a committee of creditors or interest holders. 12

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Exhibit 1 Engagement Agreement

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2000 Avenue of the Stars, 9th Floor South

Los Angeles, California 90067

TEL 310 246 3700

800 929 2299

FAX 310 246 3714

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American Suzuki Motor Corporation November 1, 2012 Page 2 of 7

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American Suzuki Motor Corporation November 1, 2012 Page 3 of 7

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American Suzuki Motor Corporation November 1, 2012 Page 4 of 7

Imperial Capital, LLC

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American Suzuki Motor Corporation November 1, 2012 Page 5 of 7

By: Name: Takashi Iwatsuki Title: Chairman

Imperial Capital, LLC

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American Suzuki Motor Corporation November 1, 2012 Page 6 of 7