PART III
EXHIBIT 6.6
ADMINISTRATIVE SERVICES AGREEMENT
ADMINISTRATIVE SERVICES AGREEMENT
THIS ADMINISTRATIVE SERVICES AGREEMENT (the "Agreement")
is made and entered into to be effective the 1st day of
January, 1998, by and among FULL TILT SPORTS, INC., a Colorado
corporation (the "Company") and MCM CAPITAL MANAGEMENT, INC., a
Colorado corporation (the "Manager").
RECITALS
WHEREAS, the Company is engaged in the business of
manufacturing and distribution of sportswear and apparel, and
is in need of office facilities and support services to
facilitate its business; and
WHEREAS, the Manager is engaged in the business of
managing and administering the day to day operations of
businesses such as the Company, and the Company desires to
retain the Manager for such services;
NOW THEREFORE, in consideration of the Recitals that shall
be deemed to be a substantive part of this Agreement and the
mutual covenants, promises, agreements, representations and
warranties contained in this Agreement, the parties hereto do
hereby covenant, promise, agree, represent and warrant as
follows:
1. Management Services.
(a) The Company hereby engages the Manager to provide
administrative and support services reasonably required in the
ordinary course of the Company's business, including for the day
to day operations of the Company and such further services for
the benefit of the Company as described herein. The management
services (the "Management Services") provided by the Manager
herein shall include, but not be limited to:
(i) Office Services. Telephone
answering and receptionist services,
secretarial services including typing,
document and report preparation, record and
bookkeeping, personnel services, and other
support functions normally and reasonably
required in the ordinary course of the
Company's business;
(ii) Consulting Services. Manager shall
interface and provide Company information to
outside professionals and consultants, such
as attorneys and accountants, for purposes
such as Securities Exchange Commission
compliance filings and Internal Revenue
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Service tax reporting;
(iii) Facilities. Company shall have
access to, and may use as needed on a non-
exclusive basis, the Managers's office
facility consisting of approximately 3,000
square feet of office space located at the
Manager's principal business location at 0000
Xxxxxxxx Xxxxx, Xxxxx 000, Xxxxxxxx Xxxxxxx,
Xxxxxxxx 00000, with furniture, fixtures and
equipment located therein (the "Facilities").
The Company may use the Facilities for client
reception, conference rooms for meetings,
delivery of mail and packages, and as
executive and administrative offices. The
Company shall inform the Manager in advance
when use of the Facilities is requested for
the abovementioned purposes, which use shall
be subject to the Facilities' availability.
The Facilities shall be available subject to
the use and needs of the Facilities by the
Manager, which shall take precedence over the
Company's request and needs. The Company
shall have access to the Facilities during
normal business hours, Monday to Friday, 8 AM
to 5 PM or as otherwise arranged with the
Manager;
(iv) Warehouse and Storage. Company
shall also be afforded non-exclusive use of
the storage areas at the Manager's office for
delivery, warehousing and storage of the
Company's merchandise so as not to interfere
with the normal business operation of the
Manager. The Company shall have access to
the facilities for warehousing and storage
during normal business hours, Monday to
Friday, 8 AM to 5 PM or as otherwise arranged
with the Manager.
(b) The Manager hereby accepts such engagement and shall,
subject to the direction of the Board of Directors of the
Company, at all times faithfully, with diligence and to the best
of its ability, experience and talents, perform all the duties
required by the terms of this Agreement to the reasonable
satisfaction of the Company.
(c) The Manager shall devote as much of the Manager's time
and attention as is reasonably necessary to fulfill the Manager's
responsibilities herein. The Manager shall determine when and
where the Manager shall provide the Management Services. The
number and hours of service of the Manager's personnel assigned
to perform the Management Services shall be determined by the
Manager in its discretion.
2. Term. The term of this Agreement shall commence on
the date first written above, and shall continue for twelve (12)
consecutive months from the date of commencement, unless
terminated earlier in accordance with provisions hereinafter set
forth. At the expiration of the term of this Agreement, the
parties may upon written agreement, renew this Agreement for an
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additional twelve (12) month term.
3. Fees. The Company shall pay to the Manager a fee of
two thousand five hundred dollars ($2,500) per month gross plus
certain expenses itemized herein, payable on the first day of
each month.
4. Expenses. The Manager is authorized to incur reasonable
expenses for performing the Management Services. Such expenses
shall include costs for photocopies, long distance telephone,
overnight delivery, courier services, postage and other ordinary
office expenses incurred on behalf of the Company and not
included as Management Services. The Company shall reimburse the
Manager for all such expenses on the presentation by the Manager
of an itemized account of such expenditures. The Manager shall
prepare and deliver to the Company a written statement detailing
all expenses for the previous month.
5. Non-exclusivity. This Agreement is nonexclusive
and does not preclude the Manager from performing services of any
kind or nature for any other entities or concerns, or from
entering into any other business of any kind or nature.
6. Termination.
a) Termination by the Company With Cause. The Company may
Terminate this Agreement with cause at any time in accordance
with the terms and conditions herein, upon immediate notice to
the Manager. For the purpose of this section, "cause" shall be
defined as meaning conduct by the Manager which constitutes in
fact or law a breach of fiduciary duty or felonious conduct
having the effect, in the opinion of the Company, of materially
adversely affecting the Company or its reputation. In the event
of termination by the Company with cause, the Manager shall be
entitled to receive payment of the monthly fee herein up until
and including the month that such written notice is received.
The Manger shall not be entitled to any other compensation under
this Agreement.
b) Termination by Company Without Cause. The Company may
Terminate this Agreement without cause at any time, in accordance
with the terms and conditions herein, upon sixty (60) written
notice to the Manager. In the event of termination by the
Company without cause, the Manager shall be entitled to receive
the monthly fee herein for two (2) monthly periods, after the
Manager's receipt of such termination notice. The Manger shall
not be entitled to any other compensation under this Agreement.
c) Termination by Manager. The Manager may elect to
terminate this Agreement, with or without cause, for any reason
whatsoever, by providing the Company thirty (30) days written
notice of such election. In the event of such termination by the
Manager, the Manager shall be entitled to receive the monthly fee
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herein up to and including the month that notice of such
termination is received by the Company.
d) Return of Company Records and Material. Immediately upon
termination, the Manager shall return any and all records,
material and tangible things to the Company.
7. Independent Contractor Status. Manager shall be an
independent contractor with respect to all services provided
herein, and shall have no authority to bind the Company in any
manner. The Company shall not be responsible for payment of
FICA/FUTA or for providing workers' compensation insurance for
Manager. The Company shall not withhold any state or federal
income taxes on account of Manager's compensation. The Manager
shall make all arrangements necessary for timely payment of all
the foregoing on the Manager's own account. In the event the
Company is subject to any claim, action or liability in
connection with the aforementioned, including attorneys fees,
costs and expenses in the defense of any such action or claims,
the Manager shall discharge such claims, actions and liabilities
immediately and shall indemnify and hold harmless the Company for
such liabilities and expenses.
8. Confidential Information. Throughout the duration
of the Manager's service, the Manager shall be privy to a
substantial amount of data, information and knowledge which is
the proprietary and confidential property of the Company. For
the purposes of this Agreement, "trade secret or confidential or
proprietary information" means any information concerning the
Company or its business which the Manager learned during the
Manager's services at the Company and which is not generally
known or available outside of the Company; such information
includes, without limitation, information, whether written or
otherwise, regarding the Company's earnings, expenses,
manufacturing processes, material sources, equipment sources,
customers and prospective customers, business plans, strategies,
buying practices and procedures, prospective and executed
contracts and other business arrangements. The Manager
acknowledges that the Manager shall not either directly or
indirectly use, disclose or communicate to any person or entity
any trade secret or confidential or proprietary information of
the Company for any purpose at all whether during or after the
term of this Agreement, except to the extent any such information
becomes generally known to the public through no fault of the
Manager.
9. Indemnification. The Company shall indemnify and
hold harmless the Manager from and against any and all damages,
liabilities, actions, suits, proceedings, claims, threats,
demands, losses, costs and expenses (including attorneys' and
experts' fees) arising out of or in connection with: (a) the
negligent or intentionally wrongful acts or omissions of the
Company, its agents, servants, employees and independent
contractors, other than the Manager, under this Agreement; and
(b) any breach of or default by the Company under any covenant,
promise, agreement, representation or warranty set forth in this
Agreement.
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10. Governing Law. This Agreement shall be governed in
accordance with the laws of the State of Colorado.
IN WITNESS WHEREOF, the parties hereto have executed and
delivered this Agreement, on the date first above written.
COMPANY:
Full Tilt Sport, Inc.
By: /s/ Xxxxx X. Xxxxxxx
___________________________
Xxxxx X. Xxxxxxx, President
MANAGER:
MCM Capital Management, Inc.
By: /s/ Xxxx X. Xxxxxx
__________________________
Xxxx X. Xxxxxx, Vice President
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