MANAGEMENT SERVICES AGREEMENT
Management Services Agreement dated as of March 11, 1998 ("Agreement")
by and between Bolle Inc., a Delaware corporation ("Bolle"), and BEC Group,
Inc., a Delaware corporation ("BEC").
W I T N E S S E T H
WHEREAS, BEC is experienced in the overall management and direction of
corporations which design, develop, manufacture and distribute products for
specialized markets throughout the world; and;
WHEREAS, Bolle, a manufacturer of sunglasses, eyeglasses and goggles,
desires to engage BEC to provide managerial and other advisory services to
Bolle and its subsidiaries, and BEC desires to accept such engagement;
NOW THEREFORE, in consideration of the premises and mutual covenants
and agreements hereinafter set forth, the parties hereto, desiring to be
legally bound, do hereby agree as follows:
1. ENGAGEMENT OF BEC. Bolle hereby engages BEC, and BEC hereby accepts
such engagement, to provide managerial and other advisory services on a
continuing basis to Bolle and its subsidiaries, upon the terms and conditions
hereinafter set forth.
2. SERVICES.
2.1 SCOPE OF SERVICES. Subject to the terms and conditions hereof, BEC
shall provide on a continuing basis to Bolle and its subsidiaries such
managerial and advisory services relating to Bolle and its subsidiaries, as are
specified in Section 2.2 hereof and as Bolle may reasonably request from time
to time having regard to BEC's experience and expertise, personnel and the
remuneration payable to BEC under this Agreement. Under no circumstances shall
BEC be required to provide the services of outside professionals or consultants
in fulfilling its obligations hereunder, except on such terms and conditions as
may be agreed between the parties from time to time.
2.2 SPECIFIC SERVICES. The services BEC shall provide to Bolle and its
subsidiaries hereunder shall include, but not be limited to, the following:
(a) advice and assistance as to the general and corporate policies and
strategic planning and direction of Bolle and its subsidiaries and, in
connection therewith, make available the services of Xxxxxx X. Xxxxxxxx and Xxx
X.X. Xxxxxx;
(b) making available personnel of BEC to serve as directors on the
boards of directors of Bolle and its subsidiaries and on committees of such
board of directors as Bolle and its subsidiaries may reasonably request;
(c) advice and assistance in dealing with regulators, including,
without limitation, public hearings involving Bolle or any of its subsidiaries
before governmental and regulatory bodies;
(d) advice and assistance involving investor relations for Bolle,
including without limitation, communication with Bolle's investors, analysts
and securities regulators and the preparation and filing by Bolle of disclosure
documents and reports required to be filed by it in accordance with applicable
securities laws, rules and regulations;
(e) advice and assistance with respect to the financial affairs of
Bolle and its subsidiaries, including, without limitation, the evaluation of
budgets, business plans, capital expenditure proposals and financial
projections for Bolle and its subsidiaries, monitoring of Bolle's operational
results (including those of its subsidiaries) and consultation with management
of Bolle with respect to those results;
(f) advice and assistance in connection with the raising by Bolle or
any of its subsidiaries of external debt or equity capital and dealings by
Bolle and its subsidiaries with their respective bankers and other sources of
financial assistance;
(g) advice and assistance in connection with interest rate risk
management, foreign exchange management and excess cash investment;
(h) advice and assistance in connection with the acquisition and
divestiture of related operations;
(i) advice and assistance with regard to community relations and
public relations programs;
(j) advice, assistance and coordination in pension planning matters;
(k) advice, assistance and coordination involving insurance matters,
including, without limitations, risk management, planning, disaster advice and
coordination of insurance programs with affiliated companies;
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(l) advice and assistance in connection with Bolle's relationship with
external auditors and internal audits conducted to review the
corporate operations and affairs of Bolle and its subsidiaries,
(including, without limitation, assistance in identifying areas in
which operational improvements can be made);
(m) advice and assistance in further developing policies and
procedures for Bolle and its subsidiaries relating to financial,
accounting, human resource and benefits matters;
(n) monitoring international developments and new business
opportunities and consulting with management of Bolle regarding same.
3. FEES AND EXPENSES.
3.1 MANAGEMENT FEE. In consideration of the services to be rendered by
BEC hereunder, Bolle shall pay to BEC a monthly fee of $60,000 (the
"Management Fee"), together with any relevant sales taxes during each
year that this Agreement remains in effect. The Management Fee shall
be paid in arrears within five (5) days after the end of each month
included within the term of this Agreement.
3.2 EXPENSES. If, during the term of this Agreement, BEC incurs any
identifiable, reasonable out-of-pocket expenses (including, without
limitation, travel and living expenses) in respect of the services
rendered by BEC hereunder, BEC shall be entitled to obtain
reimbursement from Bolle of such expenses upon providing Bolle with an
invoice setting forth the particulars of the expenses for which BEC is
claiming reimbursement hereunder. Notwithstanding the foregoing, BEC
shall not be entitled to reimbursement for any known single item of
expense in excess of $10,000 unless such expense shall have been
pre-approved by the President of Bolle. Any amount due BEC under this
Section 3.2 shall be paid by Bolle within five (5) days after the end
of the month in which the invoice covering such amount was delivered
to Bolle.
3.3 LATE PAYMENTS. Notwithstanding any provision contained herein to
the contrary, if and to the extent that payment of any of the amounts
described in Section 3.1 or 3.2 hereof would result in Bolle or any of
its subsidiaries being in default under any agreement with a bank or
similar lending institution, Bolle may defer payment thereof until
such time, but only until such time, as the payment would not result
in Bolle being in default under such agreement, provided that if such
default continues for more than three (3) months BEC shall not be
obligated to provide any services pursuant to this Agreement until
such time as all outstanding amounts have been paid in accordance with
this Agreement. Any
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payment to be made to BEC pursuant to this Agreement that is not paid
when due (including, without limitation, pursuant to the deferment
contemplated in the preceding sentence) shall bear interest from the
date such payment is due until the date such payment is made at a rate
per annum equal to the prime rate of the New York City branch of
NationsBank, N.A. during such period, adjusted on a daily basis for
changes in that rate, plus 2% per annum.
4. LIMITATION OF LIABILITY. BEC assumes no responsibility to Bolle
hereunder other than as expressly set forth herein. BEC shall not be liable to
Bolle hereunder except for actual damages where BEC has acted in bad faith or
has been grossly negligent in the performance of its obligations hereunder.
Bolle agrees to indemnify and hold harmless BEC from and against any and all
losses, damages, claims, liabilities, deficiencies, costs and expenses
(including reasonable attorney's fees) ("Losses") incurred or suffered by BEC
or any of its subsidiaries, arising from or in connection with the services
provided by BEC or any of its subsidiaries pursuant to this Agreement other
than Losses suffered or incurred as a result of BEC's bad faith or gross
negligence in the performance of its obligations hereunder.
5. INDEPENDENT CONTRACTOR. BEC shall act as the independent contractor of
Bolle. BEC shall not be the legal agent of Bolle for any purpose whatsoever and
therefore has no right or authority to make or underwrite any promise, warranty
or representation, to execute any contract or otherwise to assume any
obligation or responsibility in the name of or on behalf of Bolle, except to
the extent hereafter specifically authorized in writing by Bolle. BEC shall
advise all third parties with whom it deals in the performance of services
hereunder of such lack of authority. Bolle shall not be bound by or liable to
any third party for any act or for any obligation or debt incurred by BEC
toward such third party, except to the extent hereafter specifically agreed to
in writing by Bolle.
6. TERMS. The initial term of this Agreement shall commence as of the date
hereof and shall continue through and include the third anniversary of the date
hereof. Thereafter, the term of this Agreement shall automatically continue in
full force and effect for succeeding one-year periods unless either party
hereto shall give notice of termination to the other no later than ninety (90)
days prior to the expiration of the initial term, or any renewal term then in
effect, as the case may be. The respective rights and obligations of Bolle and
BEC which have accrued hereunder at the time of expiration of this Agreement
shall not be affected by such expiration.
7. MISCELLANEOUS.
7.1 NOTICES. All notices and other communications required or
permitted hereunder shall be in writing. Notices and other communications shall
be delivered personally (including by any reputable overnight courier) or sent
by certified or registered mail, postage prepaid, or by telecopier and shall be
deemed received, in the case of personal delivery, when delivered, in the case
of mailing,
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on the third day after mailing, and in the case of telecopy transmission, upon
transmittal.
All notices and other communications given pursuant to this Agreement
shall be addressed as follows:
(a) If to Bolle, to it at:
Bolle Inc.
0000 Xxx Xxxxxx
Xxxxxx, XX 00000
Telecopier: (000) 000-0000
Attention: Xx. Xxxx Xxxxxxxxx
(b) If to BEC, to it at:
BEC Group, Inc.
000 Xxxxxxxx Xxxxx Xxxxxx
Xxxxx X-000
Xxx, Xxx Xxxx 00000
Telecopier: (000) 000-0000
Attention: Xx. Xxxxxx X. Xxxxxxxx
Either party hereto may change the person to whom or the address or
telecopier number to which notices and other communications are to be given
hereunder, but any such notice or other communication shall be effective only
when actually received by the other party hereto.
7.2 ENTIRE AGREEMENT. This Agreement contains the entire agreement
between the parties hereto with respect to the subject matter hereof and
supersedes any and all prior arrangements, agreements or understandings,
whether written or oral. During the initial term of this Agreement, no
amendment, modification or waiver of any of the terms or provisions of Section
3 hereof shall be valid or binding unless set forth in writing and signed by
Bolle and BEC. No other amendment, modification or waiver of any of the terms
or provisions hereof shall be valid or binding unless set forth in writing and
signed by Bolle and BEC.
7.3 NON-WAIVER. The waiver of, or failure to take action with regard
to, any breach of any term or condition of this Agreement shall not be deemed
to constitute a continuing waiver or a waiver of any other breach of the same
or any other term or condition.
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7.4 HEADINGS. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
7.5 COUNTERPARTS. This Agreement may be executed in more than one
counterpart and if so executed, each of such counterparts shall be deemed to be
an original, and, when executed by both parties hereto, all such counterparts
shall be read together as one agreement.
7.6 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and
inure to the benefit of the parties hereto, their successors and assigns, but
may not be assigned by either party without the prior written consent of the
other.
7.7 SEVERABILITY. If any term or provision of this Agreement shall be
held or determined to be unenforceable, the balance of this Agreement shall
nevertheless be valid and enforceable subject to an equitable revision to be
negotiated by the parties hereto with the objective of maintaining the original
balance between their respective rights and obligations.
7.8 GOVERNING LAW. This Agreement shall be enforced, governed and
construed by and interpreted under the laws of the State of New York applicable
to contracts made and to be performed wholly within such State without giving
effect to the principles of conflict of laws thereof.
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7.9 FURTHER ASSURANCES. Each party hereto shall cooperate, shall take
such further action and shall execute and deliver such further documents as may
be reasonably requested by any other party in order to fulfill the purposes of
this Agreement.
IN WITNESS WHEREOF this Agreement has been executed by the parties hereto
as of the date first above written.
BOLLE INC.
By: /s/ Xxxxxxx XxXxxxxxx
_________________________________
Name: Xxxxxxx XxXxxxxxx
Title: Vice President
BEC GROUP, INC.
By: /s/ Xxxxxx X. Xxxxxxxx
_________________________________
Name: Xxxxxx X. Xxxxxxxx
Title: Chairman of the Board
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