1
EXHIBIT 10.1
ST GROUP MANAGEMENT & SUPPORT SERVICES AGREEMENT
THIS AGREEMENT is made the 27th day of December 1999
BETWEEN:
(1) SINGAPORE TECHNOLOGIES PTE LTD, a company incorporated in Singapore and
having its registered office at 00 Xxxxxxx Xxxx, #00-00 XxxxXxx Xxxxxx,
Xxxxxxxxx 229 469 ("STPL"); and
(2) ST ASSEMBLY TEST SERVICES LTD, a company incorporated in Singapore and
having its registered office at 0 Xxxxxx Xxxxxx 00 Xxxxxxxxx 000000 ("the
Company").
WHEREAS:
(A) STPL is a majority shareholder of the Company, and the corporate
headquarters for the Singapore Technologies group of companies and provides
administrative and support services to its related companies within and
outside Singapore.
(B) STPL 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.
STPL is also able to offer the Company the benefits of a global network.
Further, the "Singapore Technologies" name, affiliation to STPL and STPL's
wide spectrum of industries provide the Company with operational and
financial leverages (such as improved credit rating, easier access to
funding and lower cost of borrowing) in its dealings with external parties
("STPL Franchise").
(C) STPL and the Company acknowledge that the centralisation of support staff
in STPL enables them to share the cost of business services, enhance
communication and eliminate duplication of efforts.
- 1 -
2
NOW IT IS HEREBY AGREED as follows:
1. CORPORATE SERVICES & SUPPORT
1.1 STPL shall maintain throughout the duration of this Agreement a staff of
personnel with acknowledged proficiency in their respective fields who
shall render the Services, as defined in Clause 1.2 below and according to
the headcounts allocated, to the Company. STPL 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 Appendix
attached.
1.3 In addition to the Services mentioned in Clause 1.1 above, the Company may
request STPL to render additional specific services relating to specific
projects, or require personnel from STPL 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 Services provided by STPL hereunder, the Company
agrees to pay ST such amount (the "Consideration") to be determined at the
beginning of each year in accordance with the Appendix. The method and
basis of determination of the Consideration shall be reviewed by the
parties every 3 years. STPL and the Company may upon mutual agreement,
delete any of the Services specified in the Appendix or add new Services
to the Appendix, in which event that Consideration shall be adjusted
accordingly by mutual agreement. Any variation shall be subject to the
written agreement of both parties.
2.2 The Company shall pay to STPL the Consideration in four equal advance
instalments upon presentation by STPL of its invoices at the beginning of
each financial quarter.
2.3 All payments by the Company to STPL 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 kind or
description. The Company shall bear all goods and services tax payable on
the supply of the Services.
3. TERM AND TERMINATION
3.1 This Agreement shall take effect from the date hereof and shall remain
valid until terminated pursuant to Clauses 3.2 and 3.3 below.
- 2 -
3
3.2 If the Company fails to effect payment of the Consideration 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 STPL to the Company, then at any time after the expiration
of such period of fourteen (14) days, STPL 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 STPL.
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.
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 of 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.
- 3 -
4
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.
- 4 -
5
IN WITNESS WHEREOF the parties have caused their duly authorised
representatives to set their hands.
Signed by }
for and on behalf of }
SINGAPORE TECHNOLOGIES PTE LTD }
in the presence of:- } /s/ GAN CHEE YEN
} ---------------------------------------
} Name: Gan Chee Yen
} Designation: Group Financial Controller
}
/s/ ISOO TAN
----------------------
Name:
Signed by }
for and on behalf of }
ST ASSEMBLY TEST SERVICES LTD }
in the presence of:- } /s/ XXXX XXX KIT
} --------------------------------------
} Name: Xxxx Xxx Kit
} Designation: Chief Financial Officer
}
/s/ XXXXXXX XXXX
---------------------
Name: Xxxxxxx Xxxx
- 5 -
6
APPENDIX
COMPUTATION OF CONSIDERATION
The Consideration payable to STPL shall be calculated on the following basis:
----------------------------------------------------------------------------------------
DESCRIPTION OF SERVICES FEE BASIS AMOUNT (S$'000)
----------------------------------------------------------------------------------------
1 Corporate Secretarial Work
Comprising corporate secretarial Co Secretary + 1 150
support for STATS. equivalent headcount
cost
----------------------------------------------------------------------------------------
2 Executive Resource Support
Comprising support provided to STATS 1 equivalent 150
Executive Resource and Compensation headcount cost
Committee ("ERCC") in the design and
implementation (including
benchmarking) of compensation
structure for executives; and together
with STATS, support to STATS ERCC
in the implementation of decisions and
support for administration of
compensation of executives under
STATS ERCC
----------------------------------------------------------------------------------------
3 Internal Audit
Comprising continuing audit plans, 1 1/2 equivalent 150
monitoring statutory compliance and headcount cost
compliance with relevant procedures
and policies.
----------------------------------------------------------------------------------------
4 Finance
Comprising treasury related activities, 1 equivalent 200
risk management, and accounting headcount cost
systems, policies, guidelines and
procedures
----------------------------------------------------------------------------------------
- 6 -
7
----------------------------------------------------------------------------------------
5 Information Technology Based on
reimbursement of its 200
share of group wide
licences and IT
infrastructure (eg
Lotus Notes,
Hyperion).
----------------------------------------------------------------------------------------
6 STPL Franchise
Comprising benefits derived from the Based on 0.25% of 3,650
STPL global network and affiliation to Group Sales or
STPL, and S$5mil, whichever is
lower.
Financial leverage such as bank Based on 0.5% of ST
guarantee support, provision of standby Financial Support or
credit facilities, improved credit rating, S$5mil, whichever is
easier access to funding and lower cost lower.
of borrowing.
GRAND TOTAL 4,500
----------------------------------------------------------------------------------------
- 7 -
8
Where:
STATS means the Company.
Group Sales means the Company and its subsidiaries' worldwide actual sales. As
the Consideration is payable in advance, the Consideration for this Service
shall be determined based on the Company and its subsidiaries' worldwide
planned sales at the beginning of the year, and at the end of the year, the
final Consideration payable for such Service shall be determined based on the
actual sales. STPL shall refund to the Company any excess payment and the
Company shall make payment to STPL of any shortfall in payment within fourteen
(14) days after the determination of the final Consideration payable for such
Service.
ST Financial Support means the projected annual average outstanding amount of
(a) standby credit facilities provided by STPL to the Company and (b) guarantee
facilities provided by the STPL to third parties to secure loans granted by
such third parties to the Company.
For the avoidance of doubt, the headcount cost allocated in the Appendix above
shall be applicable for the first year from the date hereof and shall be
adjusted every year thereafter based on mutual agreement.
- 8 -
