exv10w84






EXHIBIT 10.84




[FTI Palladium Partners Letterhead]




March 25, 2008




James Li

CEO

Syntax-Brillian Corporation

20480 E Business Parkway

City of Industry, CA 91789




Dear Board:




1. Introduction





This letter confirms the engagement of FTI Consulting, Inc (“FTI”) by Syntax-Brillian
Corporation (“you,” “your” or “SBC” or the “Company”) to provide certain employees to the
Company to assist it with the services described below (the “Engagement”). This letter of
engagement and the related supporting schedules constitute the engagement contract (the
“Engagement Contract”) pursuant to which the Services will be provided.



2. Scope of Services





To the extent requested by you, FTI will provide the following individuals to work with you
and your team in connection with the services (the “Services”) outlined below:




	 	•	 	Provide the services of Greg Rayburn (“Rayburn”) to serve as the interim chief
operating officer (the “COO”) of the Company, reporting directly to the Board of
Directors and to the Chief Executive Officer. Rayburn will lead and direct an
operational turnaround of the Company. In the capacity of interim COO Rayburn will
enjoy the same full and free access to the Board of Directors and its Committees as
other members of the senior management of SBC as specified in the Corporate
Governance Guidelines of the Board of Directors and, to the extent determined by the
Board of Directors from time to time, will be granted the right to attend and
participate (but not vote) in the meetings of the Company’s Board of Directors, or
its Committees, as an observer (it being understood that the Board of Directors of
the Company may from time to time meet in “executive session” or otherwise ask that
certain or all non-directors not attend such meeting or a portion thereof) (such role
referred to as “Board Observer”). The COO shall be considered to stand within the
attorney client privilege among or between the Company and its counsel.
	 
	 	•	 	Provide the services of Kyle Boyle (“Boyle”) and Michael Tucker (“Tucker”) to
serve as the temporary employees (the “Temporary Employees”) of the Company,




 









 












	 	 	 	with Boyle reporting directly to Rayburn and with Tucker reporting directly to the
Chief Financial Officer; The Temporary Employees shall be considered to stand within
the attorney client privilege among or between the Company and its counsel; and
	 
	 	•	 	To the extent determined by mutual agreement of you and Rayburn, provide the
services of other Temporary Employees to support Rayburn in his role and in the
accomplishment of the following specific aspects of the Services in coordination with
the Company’s senior management and assigned permanent employees:






	 	1.	 	Work with management to further identify and implement both
short-term and long-term process improvement and control initiatives within the
organization; and
	 
	 	2.	 	Assist management, if required, in the development of and
implementation of cash management strategies, tactics and processes; and
	 
	 	3.	 	Assist in the communication and/or negotiation with outside
constituents including lenders, customers and suppliers; and
	 
	 	4.	 	Assist in any re-financing of senior debt; and
	 
	 	5.	 	Assist in any sale or purchase of significant assets or business
segments; and
	 
	 	6.	 	Assist in the preparation and analysis of operating and financial
budgets if required; and
	 
	 	7.	 	Assist management, if required, with the development of a business
plan, and such other related forecasts to be utilized during negotiations with
outside constituencies or by the Company for other corporate purposes; and
	 
	 	8.	 	Have responsibility for managing the Credit Parties’ restructuring
process including, without limitation, assisting in (a) developing possible
restructuring plans or strategic alternatives for maximizing enterprise value and
(b) negotiating with the Credit Parties’ lenders, vendors, suppliers, and other
stakeholders in connection with any restructuring, including with respect to
interim, permanent, bridge or other refinancing, and any restructuring or
reorganization.
	 
	 	9.	 	Provide such other similar services as may be requested by the
Board of Directors.






We will keep you informed as to our staffing and will not add additional Temporary Employees
to the assignment beyond our current staffing levels without first obtaining your consent
that such additional resources are required and do not duplicate the



 









 






activities of other employees or professionals. Moreover, we will attempt to utilize Company
personnel to fulfill such roles and will take such steps as may be necessary to avoid
duplication with the Company’s other professionals. Furthermore, we will obtain your consent
as to the areas of responsibility being filled by all Temporary Employees and will adjust
the staffing level upwards or downwards as you direct.




In addition to these specific services, we understand that at your request and to the extent
appropriate, such Temporary Employees may be asked to participate in meetings and
discussions with the Company, its lenders, other constituencies and their respective
professionals.




The Services of the Temporary Employees may be performed by FTI or by any subsidiary of FTI,
as FTI shall determine in consultation with the Company. FTI may also provide, with the
prior approval of the Company, non-officer Services through agents or independent
contractors. References herein to FTI and its employees shall be deemed to apply also,
unless the context shall otherwise indicate, to employees of each such subsidiary and to any
such agents or independent contractors and their employees. Additionally, each Temporary
Employee and FTI or FTI Subsidiary employee, agent, or independent contractor assigned to
the Services for the Company shall also agree to abide by the terms and conditions of all
policies and procedures of the Company, including without limitation the Company’s Business
Conduct Policy, Corporate Governance Guidelines, Code of Ethics and Whistleblower Policy.



3. No Assurance on Financial Data





Because of the time and scope limitations implicit in this Engagement, the depth of our
analyses and verification of the data is significantly limited. We understand that our
Temporary Employees are not being requested to perform an audit or to apply generally
accepted auditing standards or procedures. We further understand that all of our
professionals are entitled, except in the event that it is unreasonable to do so, to rely on
the accuracy and validity of the data disclosed to us or supplied to us by the Company’s
officers, directors, employees and agents. We will not be under any obligation to update
data submitted to us or extend our activities beyond the scope set forth herein, unless we
agree to do so upon your specific request. Further, due to the factors referenced in this
paragraph, any periodic oral and/or written reports provided by us will not provide
assurances concerning the integrity of the information used in our analyses and on which our
findings and advice to you may be based.



4. Privileged and Confidential Information and Work Product





The Company acknowledges that all advice (written or oral) given by the Temporary Employees
to the Company in connection with the Engagement is, intended solely for the benefit and use
of the Company (limited to the Board of Directors and management) and we understand that the
Company has agreed to treat any ‘advice received from us, whether orally or in writing,
confidential and, except as provided in this Engagement



 









 






Contract, will not publish, distribute or disclose in any manner any advice developed by or
received from us without our prior written approval (except to the Company’s respective
officers, directors, employees, agents, attorneys, advisors lenders, or prospective lenders
and persons who have a need to know such information in order to perform services under this
Engagement Contract). Such approval shall not be unreasonably withheld. Our approval is not
needed if (a) the advice sought is required to be disclosed by law or by an order binding on
the Company or us, issued by a court having competent jurisdiction over the Company or us,
as applicable (unless such order specifies that the advice to be disclosed is to be placed
under seal) provided however that the Company shall provide FTI with prompt written notice
of such requirement, (b) such information is otherwise publicly available, (c) the
disclosure is of information in the possession of the Company prior to this Engagement or is
independently developed by the Company, or (d) the disclosure is of information acquired
from a third party who, to the Company’s knowledge owes no obligation of confidence with
respect to such information.



5. Fees





Our agreed upon compensation for services will be based on the time incurred by FTI
personnel multiplied by our standard hourly rates, summarized as follows



	 	 	 	 	 
	Senior Managing Directors
	 	$	525-715	 
	Directors/Managing Directors
	 	 	425-620	 
	Associates/Consultants
	 	 	235-440	 
	Administrative/Paraprofessionals
	 	 	100-180	 







Hourly rates are generally revised periodically. We will notify you of any such changes to
our rates. Note that we do not provide assurance regarding the outcome of our work and our
fees will not be contingent on the results of such work.




It is understood that if employees of FTI are required to testify at any administrative or
judicial proceeding relating to this matter (whether during the term of this letter
agreement or after termination), FTI will be compensated by the Company at the regular
hourly rates for each such employee, in effect at the time.




In addition to the fees outlined above, FTI will bill for reasonable direct expenses which
are likely to be incurred on your behalf during this engagement. Direct expenses include
reasonable and customary out-of-pocket expenses which are billed directly to the engagement
such as certain telephone, overnight mail, messenger, travel, meals, accommodations and
other expenses specifically related to the engagement.




We will require a retainer of $500,000 to be paid in connection with the execution of this
agreement. We typically hold this retainer and apply it to our final bill for services with
any excess then refunded to the Company. We reserve the right, however, to apply the
retainer to our fees as the engagement proceeds.



 









 






Invoices for fees and expenses incurred in connection with this Engagement may be billed
weekly, and are due upon receipt. If we do not receive payment of the retainer or any
invoice with in 5 days of the invoice date, we shall be entitled, without prejudice to any
other rights that we may have, including the charging of interest at 1.5% per month, to
immediately suspend provision of the Services until all sums due are paid in full.




The Company agrees to promptly notify FTI if it extends (or solicits the possible interest
in receiving) an offer of employment to a principal or employee of FTI involved in this
Engagement and agrees that it will pay FTI a cash fee, upon hiring, equal to 150% of the
aggregate first year’s annualized compensation, including any guaranteed or target bonus, to
be paid to FTI’ s former principal or employee that the Company or any of its subsidiaries
or affiliates hires at any time up to one year subsequent to the date of the final invoice
rendered by FTI with respect to this Engagement.



6. Conflicts of Interest





Based on the list of interested parties (the “Potentially Interested Parties”) provided by
you, we have undertaken a limited review of our records to determine FTI’s professional
relationships with the Company and its significant parties-in-interest (officers, directors,
and various lenders). FTI does work for the lender SilverPoint Finance on unrelated matters
(as well as various law firms) and has in the past worked for SilverPoint Finance in
connection with the Company. From the results of such review, we are not aware of any
conflicts of interest or relationships that would preclude us from performing the above
Services for you.




As you know, however, we are a large consulting firm with numerous offices throughout the
United States. We are regularly engaged by new clients, which may include one or more of the
Potentially Interested Parties. We will not accept an engagement that directly conflicts
with this Engagement without your prior written consent.



7. Limitation of Liability





The Company agrees to indemnify, hold harmless and defend FTI against any and all losses,
claims, damages, liabilities, penalties, judgments, awards, amounts paid in settlement,
reasonable out-of-pocket costs, fees, expenses and disbursements including, without
limitation, the reasonable out-of-pocket costs, fees, expenses and disbursements, as and
when incurred, of investigating, preparing or defending any action, suit, proceeding or
investigation (whether or not in connection with proceedings or litigation in which FTI is a
party), directly or indirectly caused by, relating to, based upon, arising out of or in
connection with the engagement of FTI by the Company or any services rendered pursuant to
such engagement; provided that the Company will not be responsible for payment of
indemnification amounts hereunder (and any indemnified person shall reimburse the Company
for indemnification amounts already paid) that are determined by a final judgment of a court
of competent jurisdiction to have resulted from an indemnified person’s bad faith, self
dealing, gross negligence or willful misconduct.



 









 






These indemnification provisions extend to the officers, directors, principals, members,
managers, stockholders, employees, representatives, agents and counsel of FTI and shall
survive the termination or expiration of the engagement. The contract rights to
indemnification conferred in this paragraph shall not be exclusive of any other right that
any indemnified person may have or hereafter acquire under any statute, agreement, order of
a bankruptcy court or pursuant to any directors and officers liability insurance policy
(including any such policy identified in Schedule I). The Company shall also reimburse any
indemnified person for all reasonable out-of-pocket expenses incurred in connection with
enforcing such indemnified person’s rights under this letter agreement.




In addition to the above indemnification, FTI personnel serving as employees of the Company
will be entitled to the benefit of the most favorable indemnities provided by the Company to
its officers and directors, whether under the Company’s by-laws, certificate of
incorporation, by contract or otherwise.




The Company agrees that it will use its commercially reasonable efforts to obtain Directors
and Officers insurance and that should such insurance be obtained, it specifically will
include and cover Rayburn (and any other employee of FTI who, at the request of the Board of
Directors of the Company, FTI agrees will serve as an officer of the Company) under the
Company’s policies for directors’ and officers’ insurance. The Company agrees to also
maintain insurance coverage for Rayburn for a period of not less than two (2) years
following the date of termination of such FTI employee’s services hereunder. The provisions
of this section 7 are in the nature of contractual obligations and no change in applicable
law or the Company’s charter, by-laws or other organizational documents or policies shall
affect any of Rayburn’s rights hereunder. The obligations of the parties as reflected herein
shall survive the termination of the Engagement.




The parties intend that an independent contractor relationship will be created by this
letter agreement. As an independent contractor, FTI will have complete and exclusive charge
of the management and operation of its business, including hiring and paying the wages and
other compensation of all its employees and agents, and paying all bills, expenses and other
charges incurred or payable with respect to the operation of its business. None of FTI’s
employees serving as a Temporary Employee, including Rayburn as COO of the Company, will be
entitled to receive from the Company any salary, bonus, compensation, vacation pay, sick
leave, retirement, pension or social security benefits, workers compensation, disability,
unemployment insurance benefits or any other Company employee benefits. FTI will be
responsible for all employment, withholding, income and other taxes incurred in connection
with the operation and conduct of its business (including those related to the Temporary
Employees).



8. Waiver of Jury Trial/Dispute Resolution





The Company agrees that neither it nor any of its assignees or successors shall (a) seek a
jury trial in any lawsuit, proceeding, counterclaim or any other action based upon or
arising out of or in connection with the engagement of FTI by the Company or any



 









 






services rendered pursuant to such engagement or (b) seek to consolidate any such action
with any other action in which a jury trial cannot be or has not been waived. The provisions
of this paragraph have been fully discussed by the Company and FTI and shall be subject to
no exceptions.



9. Term of Engagement





This letter agreement shall be effective as of the date hereof and shall continue in effect
until termination or completion of our engagement hereunder. Either the Board or Directors
(or duly authorized subcommittees of the Board of Directors) or we may terminate this letter
agreement and our engagement at any time upon the giving of at least ten (10) business days
prior written notice to the other party or immediately by either party for Cause or upon a
material breach of this Agreement by the other party. Termination shall not affect our right
to receive payment for services performed, reimbursement for reasonable out-of-pocket
expenses properly incurred (in accordance with the terms of this letter agreement), except
in the event of a termination by the Company for Cause or due to a material breach by FTI of
this Agreement, or the Company’s obligations under section 7 herein. In the event of
termination, other than by the Company for Cause or material breach by FTI, you agree to pay
us any earned and unpaid amounts through the termination.




For purposes of this Engagement Contract, “Cause” shall mean if (i) any of the officers or
directors of the Company or the officers, directors, principals or other management level
employees of FTI is convicted of, admits guilt in a written document filed with a court of
competent jurisdiction to, or enters a plea of nolo contendere to, an allegation of fraud,
embezzlement, misappropriation or any felony, (ii) any of the officers of the Company
willfully disobeys a lawful direction of the Board of Directors; or (iii) a material breach
of any of FTI’s or the Company’s material obligations under this Engagement Contract which
is not cured within thirty (30) days of the written notice to breaching party describing in
reasonable detail the nature of the alleged breach.




If any provision of this Engagement Contract shall be invalid or unenforceable, in whole or
in part, then such provision shall be deemed to be modified or restricted to the extent and
in the manner necessary to render the same valid and enforceable, or shall be deemed
excluded from this letter agreement, as the case may require, and this letter agreement
shall be construed and enforced to the maximum extent permitted by law as if such provision
had been originally incorporated herein as so modified or as if such provision had not been
originally incorporated herein, as applicable.




This Engagement Contract and each related confidentiality agreement constitute the entire
understanding between the parties with respect to the subject matter and supercede all prior
written and oral proposals, understandings, agreements and/or representations, all of which
are merged herein. Any amendment or modification of this letter agreement shall be in
writing and executed by each of the parties hereto.



 









 





10. Governing Law and Jurisdiction





This Engagement Agreement shall be governed by and construed and enforced in accordance with
the laws of the State of New York. The Courts of New York shall have exclusive jurisdiction
in relation of any claim, dispute or difference concerning the Engagement Agreement and any
matter arising from it. The parties hereto irrevocably waive any right they may have to
object to any action being brought in these Courts, to claim that the action has been
brought to an inconvenient forum or to claim that those Courts do not have jurisdiction.



11. Notice





All notices required or permitted to be delivered under this Engagement Contract shall be
sent, if to us, to the address set forth above, to the attention of Greg Rayburn, and if to
you, to the address for you set forth above, to the attention of your General Counsel, or to
such other name or address as may be given in writing to the other party. All notices
required or permitted to be delivered under this Engagement Contract shall also be sent to
the Board of Directors to such addresses that are given in writing. All notices under the
Engagement Contract shall be sufficient if delivered by facsimile or overnight mail. Any
notice shall be deemed to be given only upon actual receipt.



12. All Other Agreements Superseded





This letter supersedes all previous proposals, letters of engagement, undertakings,
agreements, understandings, correspondence and other communications, whether written or
oral, regarding the Services including any and all contracts and relationships that may
exist or have existed to date between FTI and the Company, and specifically including that
certain engagement letter between the Company and FTI dated January 29, 2008.



13. Continuation of Terms





The terms of the Engagement Contract that by their context are intended to be performed
after termination or expiration of this Engagement Contract, including but not limited to,
section 4 and section 7, are intended to survive such termination or expiration and shall
continue to bind all parties.



14. Citation of Engagement





Notwithstanding anything to the contrary contained herein, after the engagement of FTI
becomes a matter of public record, we shall have the right to disclose our retention by the
Company or the successful completion of its services hereunder in marketing or promotional
materials placed by FTI, at its own expense, in financial and other newspapers or otherwise.



 









 





15. Jay Alix & Associates Protocol





FTI and the Company specifically acknowledge the Jay Alix & Associates Protocol (the
“Protocol”) imposed by the United States Trustee and the United States Bankruptcy Court
barring a financial advisory firm from serving in multiple roles on behalf of a debtor in
possession in a Chapter 11 restructuring. FTI and the Company acknowledge that in the event
of a Chapter 11 filing on behalf of the Company, the Protocol will apply such that an
application to retain FTI as COO pursuant to this Engagement Contract and the appropriate 11
U.S.C. Section will likely be made. Thus, the Company engages FTI in a single capacity,
solely as COO, to provide the Services set forth herein, so as to comply (among other
things) with the Protocol.



[Remainder of page left intentionally blank.]




 









 








     We look forward to working with you on this matter. Please sign and return a copy of this
letter signifying your agreement with the terms and provisions herein. If you have any questions,
please contact Greg Rayburn at (212)499-3622.



	 	 	 	 	 
	Very truly yours,	 	 
	 
	 	 	 	 
	FTI Consulting Inc.	 	 
	 
	 	 	 	 
	By

	 	/s/ Greg Rayburn	 	 
	 

	 	 

Greg Rayburn
	 	 
	 

	 	Senior Managing Director	 	 
	 
	 	 	 	 
	Date

	 	4/8/2008	 	 
	 
	 	 	 	 
	Agreed by: Syntax-Brillian Corporation	 	 
	 
	 	 	 	 
	By

	 	/s/ James Li	 	 
	 

	 	 

James Li
	 	 
	 

	 	CEO	 	 
	 
	 	 	 	 
	Date

	 	4/8/2008