Exhibit 10.22
BEAR XXXXXXX 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 ICST Acquisition Corp., a Delaware corporation
("Bear Xxxxxxx"). 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 Bear Xxxxxxx and Bear Xxxxxxx
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 Bear Xxxxxxx
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 this Agreement shall terminate upon the termination of the Xxxx
Capital Advisory Agreement as in existence on the date hereof and as amended,
modified or replaced (the "Bain Advisory Agreement"), dated as of the date
hereof, by and between the Company and Xxxx Capital Partners VI, L.P. (together
with its successors, assigns and designees, "Bain"). No termination of this
Agreement, whether pursuant to this paragraph or otherwise, shall effect the
Company's obligations with respect to the fees, costs and expenses incurred by
Bear Xxxxxxx in rendering services hereunder and not reimbursed by the Company
as of the effective date of such termination.
2. Services. Bear Xxxxxxx 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 Bear Xxxxxxx agree.
3. Advisory Fee. Payment for services rendered by Bear Xxxxxxx and/or its
affiliates incurred in connection with the performance of services pursuant to
this Agreement shall be in an amount equal to one-third of the payments made by
the Company to Bain and its permitted assignees pursuant to the terms of the
Bain Advisory Agreement during the same period of time, plus reasonable
out-of-pocket expenses of Bear Xxxxxxx and/or its affiliates, payable by the
Company to Bear Xxxxxxx or its designees on a quarterly basis in advance
commencing as of the date hereof (such that, pursuant to the Bain Advisory
Agreement in effect as of the date hereof (and assuming no amendment,
modification or waiver thereof), Bain would be entitled to $750,000 per annum
and Bear Xxxxxxx would be entitled to $250,000 per annum, in each case plus
reasonable out-of-pocket expenses).
4. Transaction Fees.
(a) The Company hereby agrees to pay to Bear Xxxxxxx 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 Bear Xxxxxxx or its designees by wire transfer in an amount not
to exceed 40% of the aggregate value of the closing fees paid to Bain and
its designees pursuant to clause 4(a) of the Bain Advisory Agreement, plus
reasonable out-of-pocket expenses.
(b) In addition, during the term of this Agreement, the Company shall
pay to Bear Xxxxxxx or its designees, for any transaction in which Bain
receives 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 25% of the aggregate value of transaction fees paid to
Bain and its designees pursuant to clause 4(b) of the Bain Advisory
Agreement for such transaction, plus reasonable out-of-pocket expenses.
5. Personnel. Bear Xxxxxxx shall provide and devote to the performance of
this Agreement such partners, employees and agents of Bear Xxxxxxx as Bear
Xxxxxxx shall xxxx appropriate to the furnishing of the services required.
6. Liability. Neither Bear Xxxxxxx 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
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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 gross negligence, willful misconduct or
bad faith on the part of an Indemnitee acting within the scope of such person's
employment or authority. Bear Xxxxxxx makes no representations or warranties,
express or implied, in respect of the services to be provided by Bear Xxxxxxx or
any of the other Indemnitees. Except as Bear Xxxxxxx may otherwise agree in
writing after the date hereof: (i) Bear Xxxxxxx 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 Bear Xxxxxxx 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 Bear Xxxxxxx
acquires knowledge of a potential transaction or matter that may be a corporate
opportunity for both the Company and Bear Xxxxxxx or any other person, Bear
Xxxxxxx 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 Bear Xxxxxxx 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 Bear Xxxxxxx
hereunder.
7. Indemnity. The Company and its subsidiaries shall defend, indemnify and
hold harmless each of Bear Xxxxxxx, 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 Bear Xxxxxxx
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 Bear Xxxxxxx:
ICST Acquisition Corp.
c/o Bear, Xxxxxxx & Co. Inc.
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Attn: Xxxx X. Xxxxxx
Xxxxx X. Xxxxxxxx
With a copy to:
Xxxxxxxx & Xxxxx
000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000
Attn: Xxxxxxx X. Xxxxxx
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
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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 Bear Xxxxxxx may, without
consent of the Company, assign its rights and obligations under this Agreement
to any of its affiliates, provided that such affiliate is a person or entity
directly or indirectly controlled by or under common control with The Bear
Xxxxxxx Companies Inc. The assignor shall remain liable for the performance of
any assignee.
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 and by Bain. All issues concerning this agreement shall be governed by and
construed in accordance with the laws of the State of New York, without giving
effect to any choice of law or conflict of law provision or rule (whether of the
State of New York or any other jurisdiction) that would cause the application of
the law of any jurisdiction other than the State of New York.
13. Construction. References herein to this Agreement, the Bain 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
----------------------------------
By: Xxxx X. Xxx
Its: Chief Executive Officer
ICST ACQUISITION CORP.
By: /s/ Xxxxx Xxxxxxxx
----------------------------------
Name: Xxxxx Xxxxxxxx
Its: Vice President
Acknowledged and accepted:
XXXX CAPITAL, PARTNERS VI, LP. INC.
By: XXXX CAPITAL INVESTORS VI, INC.
Its: General Partner
By: ________________________
Name: ________________________
Its: ________________________
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
----------------------------------
By: Xxxx X. Xxx
Its: Chief Executive Officer
ICST ACQUISITION CORP.
By: /s/ Xxxxx Xxxxxxxx
---------------------------
Name: Xxxxx Xxxxxxxx
Its: Vice President
Acknowledged and accepted:
XXXX CAPITAL, PARTNERS VI, LP. INC.
By: XXXX CAPITAL INVESTORS VI, INC.
Its: General Partner
By:____________________________
Name:__________________________
Its:___________________________
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
-------------------------------
By: Xxxx X.Xxx
Its: Chief Executive Officer
ICST ACQUISITION CORP.
By: /s/ Xxxx X. Xxx
--------------------------
Name:
Its:
Acknowledged and accepted:
XXXX CAPITAL, PARTNERS VI, LP. INC.
By: XXXX CAPITAL INVESTORS VI, INC.
Its: General Partner
By: /s/ [ILLEGIBLE]
--------------------
Name: ___________________
Its: ___________________
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
--------------------------------
By: Xxxx X. Xxx
Its: Chief Executive Officer
ICST ACQUISITION CORP.
By: /s/ Xxxxx Xxxxxxxx
------------------------
Name: Xxxxx Xxxxxxxx
Its: Vice President
Acknowledged and accepted:
XXXX CAPITAL, INC.
By: ____________________
Name: ____________________
Its: ____________________
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
--------------------------------
By: Xxxx X. Xxx
Its: Chief Executive Officer
ICST ACQUISITION CORP.
By: /s/ Xxxxx Xxxxxxxx
------------------------
Name: Xxxxx Xxxxxxxx
Its: Vice President
Acknowledged and accepted:
XXXX CAPITAL, INC.
By: ____________________
Name: ____________________
Its: ____________________
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
--------------------------------
By: Xxxx X. Xxx
Its: Chief Executive Officer
ICST ACQUISITION CORP.
By: /s/ Xxxxx Xxxxxxxx
------------------------
Name: Xxxxx Xxxxxxxx
Its: Vice President
Acknowledged and accepted:
XXXX CAPITAL, INC.
By: ____________________
Name: ____________________
Its: ____________________
