Exhibit 10.21
XXXX CAPITAL ADVISORY AGREEMENT
This ADVISORY AGREEMENT (this "Agreement") is made and entered into as of
May 11, 1999, by and between Integrated Circuit Systems, Inc., a Pennsylvania
corporation (the "Company"), and Xxxx Capital Partners VI, L.P., a Delaware
limited partnership Capitalized terms used but not defined herein shall have the
meanings assigned to such terms in the Agreement and Plan of Merger, dated as of
January 20, 1999, as amended, by and among the Company and ICS Merger Corp., a
Pennsylvania corporation (the "Merger Agreement").
WHEREAS, the Company desires to retain Bain and Bain desires to perform for
the Company and its subsidiaries certain services;
NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein, the parties agree as follows:
1. Term. This Agreement shall be in effect for an initial term of ten (10)
years commencing on the date hereof (the "Term"), and shall be automatically
extended thereafter on a year to year basis unless the Company or Bain provides
written notice of its desire to terminate this Agreement to the other party 90
days prior to the expiration of the Term or any extension thereof provided that
the Term shall terminate after giving effect to such time (if any) that the Bain
Stockholders and their Affiliates no longer hold at least 50% of the Common
Stock of the Company that they own as of the date hereof. No termination of this
Agreement, whether pursuant to this paragraph or otherwise, shall affect the
Company's obligations with respect to the fees, costs and expenses incurred by
Bain in rendering services hereunder and not reimbursed by the Company as of the
effective date of such termination. For purposes hereof, "Bain Stockholders"
shall mean Xxxx Capital Fund VI, L.P., BCIP Trust Associates II, BCIP Trust
Associates II-B, BCIP Associates II-B, BCIP Associates, and BCIP Associates
II-C, PEP Investments PTY Limited., Xxxxxxxx Street Partners II and Xxxxxxxx
Street Partners 1998 DIF, L.L.C.
2. Services. Bain shall perform or cause to be performed such services for
the Company and its subsidiaries as directed by the Company's board of
directors, which may include, without limitation, the following:
(a) general executive and management services;
(b) identification, support, negotiation and analysis of acquisitions
and dispositions by the Company or its subsidiaries;
(c) support, negotiation and analysis of financing alternatives,
including, without limitation, in connection with acquisitions, capital
expenditures and refinancing of existing indebtedness;
(d) finance functions, including assistance in the preparation of
financial projections, and monitoring of compliance with financing
agreements;
(e) marketing functions, including monitoring of marketing plans and
strategies;
(f) human resource functions, including searching and hiring of
executives; and
(g) other services for the Company and its subsidiaries upon which the
Company's board of directors and Bain agree.
3. Advisory Fee. Payment for services rendered by Bain and/or its
affiliates incurred in connection with the performance of services pursuant to
this Agreement shall be $750,000 per annum, plus reasonable out-of-pocket
expenses of Bain and/or its affiliates, payable by the Company to Bain or its
designees on a quarterly basis in advance commencing as of the date hereof.
4. Transaction Fees.
(a) The Company hereby agrees to pay to Bain or its designees on the
Closing Date a fee for services rendered in connection with the structuring
of the financing for the transactions contemplated by the Merger Agreement
and certain other management services. Such fees shall be payable to Bain
or its designees by wire transfer in an amount not to exceed 1.67% of the
aggregate value of the financing for the transactions contemplated by the
Merger Agreement ("Closing Fee") plus reasonable out-of-pocket expenses
(with it being understood that 40% of any Closing Fee actually paid shall
be directed by Bain to be paid by the Company to The Bear Xxxxxxx Companies
Inc. or its Affiliates pursuant to the terms of the Bear Xxxxxxx Advisory
Agreement, dated as of the date hereof).
(b) In addition, during the term of this Agreement, the Company shall
pay to Bain or its designees for any transaction in which Bain is
materially involved in sourcing, evaluating, financing, negotiating or
otherwise managing, a transaction fee in connection with the consummation
of each acquisition, divestiture or financing by the Company or its
subsidiaries in an amount equal to 1% of the aggregate value of such
transaction (the "Transaction Fee") plus reasonable out-of-pocket expenses
(with it being understood that 25% of any Transaction Fee actually paid
shall be directed by Bain to be paid by the Company to The Bear Xxxxxxx
Companies Inc. or its Affiliates pursuant to the terms of the Bear Xxxxxxx
Advisory Agreement, dated as of the date hereof).
5. Personnel. Bain shall provide and devote to the performance of this
Agreement such partners, employees and agents of Bain as Bain shall xxxx
appropriate to the furnishing of the services required.
6. Liability. Neither Bain nor any other Indemnitee (as defined in Section
7 below) shall be liable to the Company or its subsidiaries or affiliates for
any loss, liability, damage or expense arising out of or in connection with the
performance of services contemplated by this Agreement, unless such loss,
liability, damage or expense shall be proven to result directly from
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gross negligence, willful misconduct or bad faith on the part of an Indemnitee
acting within the scope of such person's employment or authority. Bain makes no
representations or warranties, express or implied, in respect of the services to
be provided by Bain or any of the other Indemnitees. Except as Bain may
otherwise agree in writing after the date hereof: (i) Bain shall have the right
to and shall have no duty (contractual or otherwise) not to, directly or
indirectly: (A) engage in the same or similar business activities or lines of
business as the Company, including those competing with the Company and (B) do
business with any client or customer of the Company; (ii) neither Bain nor any
officer, director, employee, partner, affiliate or associated entity thereof
shall be liable to the Company or its subsidiaries or affiliates for breach of
any duty (contractual or otherwise) by reason of any such activities of or of
such person's participation therein; and (iii) in the event that Bain acquires
knowledge of a potential transaction or matter that may be a corporate
opportunity for both the Company and Bain or any other person, Bain shall have
no duty (contractual or otherwise) to communicate or present such corporate
opportunity to the Company and, notwithstanding any provision of this Agreement
to the contrary, shall not be liable to the Company or its affiliates for breach
of any duty (contractual or otherwise) by reasons of the fact that Bain directly
or indirectly pursues or acquires such opportunity for itself, directs such
opportunity to another person, or does not present such opportunity to the
Company. In no event will either party hereto be liable to the other for any
indirect, special, incidental or consequential damages, including lost profits
or savings, whether or not such damages are foreseeable, or in respect of any
liabilities relating to any third party claims (whether based in contract, tort
or otherwise) other than the Claims (as defined in Section 7 below) relating to
the service to be provided by Bain hereunder.
7. Indemnity. The Company and its subsidiaries shall defend, indemnify and
hold harmless each of Bain, its affiliates, partners, employees and agents
(collectively, the "Indemnitees") from and against any and all loss, liability,
damage or expenses arising from any claim by any person with respect to, or in
any way related to, the performance of services contemplated by this Agreement
(including attorneys' fees) (collectively, "Claims") resulting from any act or
omission of any of the Indemnitees, other than for Claims which shall be proven
to be the direct result of gross negligence, bad faith or willful misconduct by
an Indemnitee. The Company and its subsidiaries shall defend at its own cost and
expense any and all suits or actions (just or unjust) which may be brought
against the Company, any of its subsidiaries or any of the Indemnitees or in
which any of the Indemnitees may be impleaded with others upon any Claims, or
upon any matter, directly or indirectly, related to or arising out of this
Agreement or the performance hereof by any of the Indemnitees, except that if
such damage shall be proven to be the direct result of gross negligence, bad
faith or willful misconduct by an Indemnitee, then Bain shall reimburse the
Company and its subsidiaries for the costs of defense and other costs incurred
by the Company and its subsidiaries.
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8. Notices. All notices hereunder shall be in writing and shall be
delivered personally or mailed by United States mail, postage prepaid, addressed
to the parties as follows:
To the Company:
Integrated Circuit Systems, Inc.
0000 Xxxxxxxxx xx xxx Xxxxxxxx
Xxxxxx Xxxxx, XX 00000
Attn: Chief Executive Officer
With a copy to:
Xxxxxx Xxxxxxxx LLP
3000 Two Xxxxx Square
00xx xxx Xxxx Xxxxxxx
Xxxxxxxxxxxx, XX 00000
Facsimile: (000) 000-0000
Attn: Xxxxxx X. Xxxxxxx
To Bain:
c/o Bain Capital, Inc.
Two Xxxxxx Xxxxx
Xxxxxx, XX 00000
Facsimile: (000) 000-0000
Attn: Xxxxx Xxxxxxx
Xxxxxxx Xxxxxx
Yoo Xxx Xxx
With a copy to:
Xxxxxxxx & Xxxxx
000 Xxxx Xxxxxxxx Xxxxx
Xxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxx, P.C.
Xxxxxxx Xxxxxxx
9. Assignment. Neither party may assign any obligations hereunder to any
other party without the prior written consent of the other party (which consent
shall not be unreasonably withheld); provided that Bain may, without consent of
the Company, assign its rights and obligations under this Agreement to any of
its affiliates (but only if such affiliate is a person or entity (excluding any
Bain portfolio companies) controlled by Bain, or in the case of an affiliate
which is a partnership, only if Bain is the ultimate general partner of such
partnership). The assignor shall remain liable for the performance of any
assignee.
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10. Successors. This Agreement and all the obligations and benefits
hereunder shall inure to the successors and assigns of the parties.
11. Counterparts. This Agreement may be executed and delivered by each
party hereto in separate counterparts, each of which when so executed and
delivered shall be deemed an original and all of which taken together shall
constitute but one and the same agreement.
12. Entire Agreement; Modification; Governing Law. The terms and conditions
hereof constitute the entire agreement between the parties hereto with respect
to the subject matter of this Agreement and supersede all previous
communications, either oral or written, representations or warranties of any
kind whatsoever, except as expressly set forth herein. No modifications of this
Agreement nor waiver of the terms or conditions thereof shall be binding upon
either party unless approved in writing by an authorized representative of such
party. All issues concerning this agreement shall be governed by and construed
in accordance with the laws of the Commonwealth of Massachusetts, without giving
effect to any choice of law or conflict of law provision or rule (whether of the
Commonwealth of Massachusetts or any other jurisdiction) that would cause the
application of the law of any jurisdiction other than the Commonwealth of
Massachusetts.
13. Construction. References herein to this Agreement, the Bear Xxxxxxx
Advisory Agreement or any other agreement shall be references to such agreement,
as amended, modified, supplemented or waived from time to time.
* * * * *
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IN WITNESS WHEREOF, the parties have executed this Advisory Agreement as of
the date first written above.
INTEGRATED CIRCUIT SYSTEMS, INC.
/s/ Xxxx X. Xxx
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By: Xxxx X. Xxx
Its: Chief Executive Officer
XXXX CAPITAL PARTNERS VI, L.P.
By: XXXX CAPITAL INVESTORS VI, INC.
Its: General Partner
By: /s/ Xxxxxxx Xxxxxx
--------------------------
Name:
Its:
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