MANAGEMENT AGREEMENT



         This Management Agreement (this "Agreement") is entered into as of the

27th day of September, 1999, by and between ICON Health & Fitness, Inc., a

Delaware corporation ("ICON"), HF Holdings, Inc., a Delaware corporation

("Holdings" and, together with ICON and each of its other direct and indirect

subsidiaries signatory hereto or hereafter becoming party hereto by executing a

counterpart signature page hereof, the "Company") and Scott R. Watterson

("Watterson").



         WHEREAS, Holdings was formed for the purpose of effecting an overall

plan to restructure the capitalization of ICON (the "Restructuring"), and

becoming a direct parent of ICON on terms and subject to the conditions of (a)

the Exchange Offer and Consent Solicitation Statement, dated July 30, 1999, as

supplemented, for all outstanding 13% Senior Subordinated Notes due 2002 of

ICON, 15% Senior Secured Discount Notes due 2004 of IHF Holdings, Inc., a

Delaware corporation, and 14% Senior Discount Notes due 2006 of ICON Fitness

Corporation, a Delaware corporation, and (b) the Agreement and Plan of Merger,

dated as of September 27, 1999, among Holdings, HF Acquisition, Inc., a Delaware

corporation, and ICON.



         WHEREAS, Watterson has provided advisory and other services, and is

providing equity financing (the "Equity Investment"), in connection with the

Restructuring; and



         WHEREAS, subject to the terms and conditions of this Agreement, the

Company desires to retain Watterson to be available to provide certain

management and advisory services to the Company as requested, and Watterson

desires to provide such services;



         NOW, THEREFORE, in consideration of the mutual covenants contained

herein, the making of the Equity Investment, and for other good and valuable

consideration, the receipt and sufficiency of which are hereby acknowledged, the

parties hereto, intending to be legally bound, hereby agree as follows:



1.       Services. Watterson agrees that, during the term of this Agreement (the

"Term"), and separate and apart from any employment arrangement with the Company

or any continuation of such employment, he will:



         (a)  provide the Company, at its request, with advice in connection

              with the negotiation and consummation of agreements, contracts,

              documents and instruments necessary to provide the Company with

              financing from banks or other financial institutions or other

              entities on terms and conditions satisfactory to the Company; and



         (b   provide ICON, at its request, with financial, managerial and

              operational advice in connection with its day-to-day operations,

              including, without limitation, advice with respect to the

              development and implementation of strategies for improving the

              operating, marketing and financial performance of ICON.



2.       Payment of Fees. The Company hereby agrees to:



         (a)  pay to Watterson a fee in the amount of $208,500 in connection

              with the Restructuring, together with reimbursement of the fees

              and disbursements of Hutchins, Wheeler & Dittmar, P.C., counsel to

              Watterson incurred by Watterson in connection with the

              Restructuring through the Closing Date (as defined in the Merger

              Agreement) in connection with the Restructuring, such fees and

              expenses being payable by ICON at the closing of the Restructuring

              or, if the Restructuring is not consummated, promptly after the

              time the Company has abandoned the Restructuring; and



         (b)  subject to the terms of the credit agreement from time to time in

              effect providing for working capital financing to ICON, during the

              Term, pay to Watterson a management fee in an amount not to exceed

              $33,500 per annum, such fee being payable by ICON quarterly in

              arrears, with each payment being made sixty (60) days after the

              end of each fiscal quarter of the Company.



         Each payment made pursuant to this Section 2 shall, at the request of

         Watterson, be paid by wire transfer of immediately available federal

         funds to such account(s) as Watterson may specify to the Company in

         writing prior to such payment.



3.       Term. This Agreement shall commence on the Closing Date and continue in

full force and effect, unless and until terminated by mutual consent of the

parties, for so long as Watterson remains available and willing to carry on the

business of providing services of the type described in Section 1, regardless of

his continued employment by the Company or any affiliate thereof; provided,

however, that (a) either party may terminate this Agreement following a material

Home        Intelligence        Services        Subscriptions        News        About Us

Contact Us       Terms of Use       Resend Documents       Shopping Cart

Copyright © 2008 The Consus Group LLC