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EXHIBIT 10.19
ST GROUP MANAGEMENT & SUPPORT SERVICES AGREEMENT
THIS AGREEMENT is made the 3rd day of March 1997 between
(1) SINGAPORE TECHNOLOGIES PTE LTD, a company incorporated in Singapore and
having its registered office at 00 Xxxxxxx Xxxx Xxxxx, #00-00/00 Xxx Xxxxx,
Xxxxxxxxx Xxxxxxx Xxxx, Xxxxxxxxx 000000 ("ST"), And
(2) CHARTERED SEMICONDUCTOR MANUFACTURING LTD, a company incorporated in
Singapore and having its registered office at 00 Xxxxxxxxx Xxxxxxxxxx Xxxx
Xxxxxx 0, Xxxxxxxxx 000000 ("the Company").
WHEREAS
(A) ST is the holding company of the Company, and the corporate headquarters
for the Singapore Technologies group of companies and provides headquarters
administrative and support services to its related companies within and
outside Singapore.
(B) ST has invaluable experience in the fields of finance, treasury, investment
risk review, governmental relations, business development, management
information systems, human resources management and development, legal and
corporate secretarial matters and internal audit. ST is also able to offer
the Company the benefits of a global network, Further, the "Singapore
Technologies" name and ST's wide spectrum of industries provide the Company
with operational and financial leverages in its dealings with other
external parties.
(C) ST and the Company acknowledge that the centralisation of support staff in
ST enables them to share the cost of business services, enhance
communication and eliminate duplication of efforts.
NOW IT IS HEREBY AGREED as follows:
1. CORPORATE SERVICES & SUPPORT
1.1 ST shall maintain throughout the duration of this Agreement a staff of
personnel with acknowledged proficiency in their respective fields who
shall render Services (as defined in Clause 1.2 below) to the Company. ST
shall also continue to work on strengthening and improving its global
network and reputation for the benefit of the ST group of companies.
1.2 "Services" shall refer to services in the areas specified in the Recitals
above.
1.3 In addition to the Services mentioned in Clause 1.1 above, the Company may
request ST to render certain additional specific services relating to
specific projects, or require
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personnel from ST to be seconded or assigned to the Company or its
subsidiaries for an agreed period of time. In such events, the said
additional services shall be invoiced on a case by case basis at terms and
conditions to be mutually agreed between the parties.
2. CONSIDERATION
2.1 In consideration of the costs incurred by ST in providing the management
and support services to the ST group of companies, the Company agrees to
pay ST such amount (the "Corporate Cost Recovery") to be computed at the
beginning of each year in accordance with Appendix A. The method and basis
of computation of the Corporate Cost Recovery shall be reviewed by the
parties periodically. Any variation shall be subject to the written
agreement of both parties.
2.2 The Company shall pay to ST the Corporate Cost Recovery in four equal
advance instalments upon presentation by ST of its invoices at the
beginning of each financial quarter.
2.3 All payments by the Company to ST shall be made in full in Singapore
Dollars within thirty (30) days of the date of invoice, without set-off or
deduction of taxes, duties, assessments or other charges of any land or
description. The Company shall bear all goods and services tax payable on
the supply of the Services.
2.4 Where such Corporate Cost Recovery exceeds the cost incurred by ST in
providing such management and support services, ST shall refund to the
Company such excess amounts as soon as practicable.
3. TERM AND TERMINATION
3.1 This Agreement shall take effect on 1 January 1996 and shall, remain valid
until terminated pursuant to Clauses 3.2 and 3.3 below.
3.2 If the Company fails to effect payment of the Corporate Cost Recovery in
accordance with Clause 2, and such default shall not be remedied within
fourteen (14) days after written notice of such default is given by ST to
the Company, then at any time after the expiration of such period of
fourteen (14) days, ST may give written notice to the Company of its desire
to terminate this Agreement, whereupon this Agreement shall terminate on
the date specified in such notice.
3.3 The parties agree that this Agreement shall terminate forthwith in the
event the Company ceases to be a subsidiary of ST.
3.4 The termination of this Agreement howsoever caused shall be without
prejudice to any obligations, rights or remedy which have accrued prior to
such termination and shall not affect any provision of this Agreement which
is expressly or by implication provided to come into effect on or continue
in effect after such termination.
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4. CONFIDENTIALITY
Except as authorised in writing by the respective party, each party shall
keep secret and shall not at any time, whether during or after this
Agreement, use for its own or any other person's advantage or reveal to any
person any of the trade secrets, secret or confidential operations,
processes or dealings, or any secret or confidential information concerning
the organisation, business or undertaking of the other party or any of its
subsidiaries or associated companies.
5. SEVERABILITY
If any provision in this Agreement at any time shall be deemed invalid,
illegal or unenforceable in any respect under Singapore law, such
invalidity, illegality or unenforceability shall not in any way affect or
impair any other provision of this Agreement and this Agreement shall be
construed as if such invalid or illegal or unenforceable provision had been
severed from the Agreement.
6. GENERAL
6.1 This Agreement contains the entire agreement between the parties in respect
to the subject matter hereof and supersedes and cancels any and all
previous negotiations, offers, agreements (whether written or oral) in
respect thereto.
6.2 This Agreement or any rights and liabilities hereunder may not be assigned
or transferred by either party hereto without the prior written consent of
the other party hereto.
6.3 No failure or delay on the part of either party hereto in exercising any
power or right hereunder shall operate as a waiver thereof nor shall any
single or partial exercise of such right or power preclude any other or
further exercise of any right or power hereunder.
7. GOVERNING LAW
7.1 This Agreement shall be governed by and construed in all respects in
accordance with the laws of Singapore.
7.2 Any dispute arising out of or in connection with this Agreement, including
any question regarding its existence, validity or termination, shall be
referred to and finally resolved by arbitration in Singapore in accordance
with the Arbitration Rules of the Singapore International Arbitration
Centre ("SIAC Rules") for the time being in force, which Rules are deemed
to be incorporated by reference into this Clause.
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IN WITNESS WHEREOF the parties have caused their duly authorised representatives
to set their hands.
Signed by XXXXX XXXX )
for and on behalf of )
SINGAPORE TECHNOLOGIES PTE LTD )
in the presence of:- ) /s/ XXXXX XXXX
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/s/ XXXX XXX
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Name:- Xxxx Xxx
Signed by TAN XXXX XXXX )
for and on behalf of )
CHARTERED SEMICONDUCTOR )
MANUFACTURING LTD )
in the presence of:- ) /s/ TAN XXXX XXXX
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/s/ XXXXXX HON
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Name: Xxxxxx Hon
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APPENDIX A
CORPORATE COST RECOVERY COMPUTATION
The Corporate Cost Recovery payable to ST shall be the total of (1) Capital
Employed, (2) Sales; and (3) Manpower calculated on the following basis:
(1) % of Capital Employed
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Tiers Capital Employed
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$0 - $1 bil 0.60%
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> $1 bil - $5 bil 0.30%
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Above $5 bil 0.10%
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(2) % of Sales
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Tiers Sales
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$0 - $1 bil 0.60%
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> $1 bil - $5 bil 0.30%
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Above $5 bil 0.10%
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(3) Manpower
(a) $ per Headcount
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Tiers Per Head
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0 - 1,000 $400
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1,001 - 5,000 $200
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Above 5,000 $100
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(4) % of Payroll
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Tiers Payroll
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$0 - $50M 1.00%
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> $50M - $150M 0.60%
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Above $150M 0.40%
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Where:
Capital Employed = Shareholders equity + minority interest + all loans
as at 31st December of preceding year end;
Sales = The Company and its subsidiaries' worldwide planned
or actual sales, whichever is higher;
Manpower = Headcount plus Payroll
Headcount = all permanent employees as at 31st
December preceding year; and
Payroll = total annual wage cost including overtime,
CPF, Skill Development Fund and Foreign
Workers Levy but excluding bonus for the
preceding year.
* Provided always that in the event that any subsidiary of the Company has
entered into an agreement or arrangement with ST pursuant to which such
subsidiary undertakes to pay any Corporate Cost Recovery or other service fees
directly to ST, then the Capital Employed, Sales and Manpower amounts
attributable to such subsidiary shall be excluded from the computation of the
Corporate Cost Recovery payable by the Company to ST.
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