Document:

exv10w31

 

Exhibit-10.31

Execution Copy

ADVISORY AGREEMENT

     This Advisory Agreement (this “Agreement”) is made and entered into as of December 1,
2005 (the “Effective Date”), by and among Avago Technologies Limited, a Singapore public
limited company (the “Company”), Avago Technologies International Sales Pte. Limited, a
Singapore private limited company (“HQCO”), Kohlberg Kravis Roberts & Co., L.P., a Delaware
limited partnership (“KKR”), and Silver Lake Management Company, L.L.C., a Delaware limited
liability company (“SilverLake” and together with KKR, the “Advisors”). Certain
defined terms are defined in Section 19.

     WHEREAS, the Company and HQCO desire to retain the Advisors with respect to the services
described herein.

     NOW, THEREFORE, the parties to this Agreement agree as follows:

     1. Term. This Agreement shall be in effect for an initial term commencing on the
Effective Date and ending on the twelfth anniversary of the Effective Date (including any
extensions thereof, the “Term”), which Term shall automatically be extended thereafter on a
year to year basis unless the Company or both Advisors provides written notice of its desire to
terminate this Agreement to each of the Advisors and the Company at least 90 days prior to the
expiration of the Term or any extension thereof. In addition, in connection with the consummation
of a Change in Control or the Initial Public Offering, the Company may terminate this Agreement by
delivery of written notice of termination to the Advisors. In the event of a termination of this
Agreement, the Company and HQCO shall pay in cash to each of the Advisors (a) all unpaid Advisory
Fees (as defined in Section 3(a)), all unpaid Subsequent Transaction Fees (as defined in
Section 4(b)) and expenses due under this Agreement with respect to periods prior to the
termination date, plus (b) the net present value (using a discount rate equal to the yield as of
such termination date on U.S. Treasury securities of like maturity based on the times such payments
would have been due) of the Advisory Fees that would have been payable with respect to the period
from the termination date through the twelfth anniversary of the Effective Date or, in the case of
any extension thereof, through the end of such extension period. The provisions of Sections
1, 4(b), 6, 7, 9, and 15 through 19 shall
survive any termination of this Agreement.

     2. Services. The Advisors shall perform or cause to be performed such services for
the Company and/or its subsidiaries as mutually agreed by the Advisors and the Company, which
services 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 and/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) human resources functions, including searching and hiring of executives; and

          (f) other services for the Company and its subsidiaries upon which the Company and the
Advisors agree.

     3. Advisory Fees and Expenses.

          (a) During the Term of this Agreement, the Company and HQCO will pay each Advisor an advisory
fee (such Advisor’s “Advisory Fee”) for each fiscal quarter of the Company equal to the
product of (x) the Quarterly Fee Amount for such fiscal quarter times (y) 50%. Each
Advisor’s Advisory Fee will be payable in advance to such Advisor or its designee by wire transfer
of immediately available funds on the first business day of the first month of each fiscal quarter.
The pro-rated amount of each Advisor’s Advisory Fee for the period commencing on the Effective
Date and ending on the last day of the Company’s fiscal quarter ending on or about January 31, 2006
will be payable by wire transfer of immediately available funds on the Effective Date.

          (b) The Company and HQCO will reimburse each Advisor for such reasonable travel expenses and
other reasonable out-of-pocket fees and expenses (including the reasonable fees and expenses of
attorneys, accountants or other advisors retained by such Advisor) as may be incurred by such
Advisor and its partners, members, employees or agents in connection with the rendering of services
pursuant to this Agreement. Such expenses will be reimbursed by wire transfer of immediately
available funds promptly upon the request of such Advisor (but in any case no later than five
business days following such request) and will be in addition to any other fees or amounts payable
to such Advisor pursuant to this Agreement. Unless requested by the Company, in no event shall any
Advisor submit its expenses to the Company more often than monthly.

     4. Transaction Fees and Expenses.

          (a) The Company will pay each of the Advisors, or their respective designees, a fee in the
amount of $17,500,000 for the services rendered by such Advisor in connection with the acquisition
(the “Acquisition”) of Agilent Technologies, Inc.’s Semiconductor Product Group (the
“Business”) as contemplated by the Asset Purchase Agreement, dated as of August 14, 2005,
as amended, among the Company and Agilent Technologies, Inc., including the evaluation,
negotiation, documentation, financing and closing of the Acquisition. Each Advisor’s fee will be
payable to such Advisor or its designee by wire transfer of immediately available funds on the
Effective Date. In addition, the Company will reimburse each Advisor or its designee, by wire
transfer of immediately available funds on the Effective Date, for its
reasonable travel expenses and other out-of-pocket fees and expenses (including the fees and
expenses of accountants, attorneys, consultants, and other advisors retained by such Advisor)
incurred in connection with the foregoing, and all amounts expended, and obligations and

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liabilities incurred, on behalf of the Company and its subsidiaries in connection with the
Acquisition, including costs, obligations and liabilities incurred in preparing the Company and its
subsidiaries to operate the Business as of the Closing.

          (b) The Company and HQCO, jointly and severally, will pay the Advisors or their designees a
transaction fee (each, a “Subsequent Transaction Fee”) in connection with the consummation
of each transaction that is completed during the Term (or completed after any termination of this
Agreement, if such transaction was contemplated at the time of termination of the Agreement)
resulting in a Change in Control, acquisition, disposition or divestiture, spin-off, split-off, or
financing (whether debt or equity financing) by or involving the Company or its subsidiaries with
an aggregate value in excess of $25,000,000 in an amount equal to 1% of the aggregate value of each
such transaction (in each case, whether such transaction is by way of merger, purchase or sale of
stock, purchase or sale or other disposition of assets, recapitalization, reorganization,
consolidation, tender offer, public or private offering or otherwise, and whether consummated
directly by the Company or its subsidiaries or, in the case of a Change in Control, indirectly by
its shareholders, and determining the value of debt financing without regard to whether such debt
financing is actually drawn upon). Each Advisor shall be entitled to a portion of such Subsequent
Transaction Fee equal to the product of (x) the amount of such Subsequent Transaction Fee,
times (y) 50%. Each Advisor’s allocated portion of a Subsequent Transaction Fee will be
payable to such Advisor or its designee by wire transfer of immediately available funds on the date
on which such transaction resulting in a Subsequent Transaction Fee is consummated.

     5. Personnel. Each Advisor will provide and devote to the performance of this
Agreement such partners, employees and agents of such Advisor as it shall deem appropriate to the
furnishing of the services mutually agreed upon by the Company and the Advisors; it being
understood that no minimum number of hours is required to be devoted by any or all of the
Advisors on a weekly, monthly, annual, or other basis. The fees and other compensation specified
in this Agreement will be payable by the Company and HQCO regardless of the extent of services
requested by the Company pursuant to this Agreement, and regardless of whether or not the Company
requests an Advisor to provide any such services. The Company acknowledges that the services of
each of the Advisors are not exclusive, and that each of the Advisors will render similar services
to other Persons (including with the same partners, employees, and agents thereof as may render
services to the Company).

     6. Liability. None of the Advisors nor any of their respective Affiliates, nor any of
their respective partners, shareholders, directors, officers, members, employees or agents
(collectively, the “Advisor Group”) shall be liable to the Company, its subsidiaries or any
of their Affiliates, employees or shareholders for any loss, liability, damage, cost, settlement,
judgment or expense (including attorneys’ fees and expenses) (collectively, a “Loss”)
arising out of or in connection with the performance of services contemplated by this Agreement or
otherwise provided by any of the Advisors to, or otherwise in connection with the operations of,
the Company or any of its subsidiaries or Affiliates, other than as a result of the willful
misconduct of such Advisor or any member of its Advisor Group. No Advisor makes any
representations or warranties, express or implied, in respect of the services provided by any member of the
Advisor Group. Except as an Advisor may otherwise agree in writing after the date hereof with
respect to itself or its Affiliates: (i) each member of the Advisor Group shall have the right to,
and shall have no duty (contractual or otherwise) not to, directly or indirectly: (A) engage in the
same or

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similar business activities or lines of business as the Company, its subsidiaries or any of
their Affiliates and (B) do business with any client or customer of the Company, its subsidiaries
or any of their Affiliates; (ii) no member of the Advisor Group shall be liable to the Company, its
subsidiaries or any of their Affiliates, employees or shareholders for breach of any duty
(contractual or otherwise) by reason of any such activities or of such Person’s participation
therein; and (iii) in the event that any member of the Advisor Group acquires knowledge of a
potential transaction or matter that may be a corporate opportunity for the Company, its
subsidiaries or any of their Affiliates or shareholders, on the one hand, and any member of the
Advisor Group, on the other hand, or any other Person, no member of the Advisor Group shall have
any duty (contractual or otherwise) to communicate or present such corporate opportunity to the
Company, its subsidiaries or any of their Affiliates or shareholders and, notwithstanding any
provision of this Agreement to the contrary, the Advisor Group shall not be liable to the Company,
its subsidiaries or any of their Affiliates or shareholders for breach of any duty (contractual or
otherwise) by reason of the fact that any member of the Advisor Group 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, its subsidiaries or any of their Affiliates or
shareholders. In no event will any of the parties hereto be liable to any other party hereto for
(i) any indirect, special, incidental or consequential damages, including lost profits or savings,
whether or not such damages are foreseeable, arising out of this Agreement or the performance of
services hereunder, or (ii) in respect of any liabilities relating to any third party claims
(whether based in contract, tort or otherwise) arising out of this Agreement or the performance of
services hereunder, except as set forth in Section 7 below.

     7. Indemnity. The Company and its subsidiaries shall defend, indemnify and hold
harmless each member of the Advisor Group from and against any and all Losses arising from any
claim by any Person with respect to, or in any way related to, this Agreement (collectively,
“Claims”) arising out of or in connection with the performance of services contemplated by
this Agreement or otherwise provided by any member of the Advisor Group to, or otherwise in
connection with the operation of the Company or any of its subsidiaries or Affiliates; provided
that the foregoing indemnity shall not be available to any Advisor if such Advisor’s Loss is a
result of the willful misconduct of such Advisor or any member of its Advisor Group. The Company
and its subsidiaries shall defend at their own cost and expense any and all suits or actions (just
or unjust) which may be brought against the Company, its subsidiaries or any of their Affiliates,
or any member of the Advisor Group or in which any member of the Advisor Group 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 member of the Advisor Group; provided that the
Company and its subsidiaries shall not settle any such Claim without the consent of the Advisors
party thereto. If the indemnification provided for above is unavailable in respect of any Losses,
then the Company and its subsidiaries, in lieu of indemnifying any member of the Advisor Group,
shall contribute to the amount paid or payable by such member of the Advisor Group in such
proportion as is appropriate to reflect the relative fault of the Company and their subsidiaries,
on the one hand, and such member, on the other
hand, in connection with the actions which resulted in such Losses, as well as any other
equitable considerations.

     8. Independent Contractor. Each of the Advisors and the Company agree that each
Advisor shall perform services hereunder as an independent contractor, retaining control over

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and responsibility for its own operations and personnel. No Advisor or any of its partners, members,
employees or agents shall be considered employees or agents of the Company or any of their
subsidiaries as a result of this Agreement nor shall any of them have authority under this
Agreement to contract in the name of or bind the Company or any of their subsidiaries, except as
expressly agreed to in writing by the Company or any of their subsidiaries, respectively.

     9. Notices. Any and all notices or other communications or deliveries required or
permitted to be provided hereunder shall be in writing and shall be deemed given, delivered and
effective on the earliest of (i) the date of transmission, if such notice or communication is
delivered via facsimile at the facsimile telephone number specified in this Section 9 prior to 5:00
p.m. (New York time) on a business day, (ii) the business day after the date of transmission, if
such notice or communication is delivered via facsimile at the facsimile telephone number specified
in this Agreement later than 5:00 p.m. (New York time) on any business day and earlier than 11:59
p.m. (New York time) on the day preceding the next business day, (iii) one (1) business day after
when sent, if sent by nationally recognized overnight courier service (charges prepaid), or (iv)
upon actual receipt by the party to whom such notice is required to be given. The address for such
notices and communications shall be as follows:

To the Company:

Avago Technologies Limited

No. 1 Yishun Avenue 7

Singapore 768923

Attention: Chief Executive Officer

To SilverLake:

Silver Lake Management Company, L.L.C.

2725 Sand Hill Road, Suite 150

Menlo Park, CA 94025

Attention: Kenneth Y. Hao

To KKR:

Kohlberg Kravis Roberts & Co., L.P.

2800 Sand Hill Road, Suite 200

Menlo Park, CA 94025

Attention: Adam H. Clammer

     10. Successors. This Agreement and all the obligations and benefits hereunder shall
inure to the successors and assigns of the parties.

     11. Assignment. No party may assign any obligations hereunder to any other party
without the prior written consent of each of the other parties; provided that any Advisor may,
without consent of the Company or the other Advisors, assign its rights and obligations under this
Agreement to any of its Affiliates.

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     12. 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.

     13. Entire Agreement. 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.

     14. Amendments and Waivers. No amendment, modification, extension, termination or
waiver of any term, provision or condition of this Agreement (each, an “Amendment”) shall
be effective unless in writing and executed by the Company and both Advisors.

     Each such Amendment shall be binding upon each party hereto. In addition, each party hereto
may waive any right hereunder, as to itself, by an instrument in writing signed by such party. No
waiver on any one occasion shall extend to or effect or be construed as a waiver of any right or
remedy on any other occasion. No course of dealing of any Person nor any delay or omission in
exercising any right or remedy shall constitute an amendment of this Agreement or a waiver of any
right or remedy of any party hereto.

     15. Governing Law. 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.

     16. Consent to Jurisdiction. Each party to this Agreement, by its execution hereof,
(a) hereby irrevocably submits to the exclusive jurisdiction of the United States District Court
for the Southern District of New York and the state courts sitting in the State of New York, County
of New York for the purpose of any action, claim, cause of action or suit (in contract, tort or
otherwise), inquiry, proceeding or investigation arising out of or based upon this Agreement or
relating to the subject matter hereof, (b) hereby waives to the extent not prohibited by applicable
law, and agrees not to assert, and agrees not to allow any of its subsidiaries to assert, by way of
motion, as a defense or otherwise, in any such action, any claim that it is not subject personally
to the jurisdiction of the above-named courts, that its property is exempt or immune from
attachment or execution, that any such proceeding brought in one of the above-named courts is
improper, or that this Agreement or the subject matter hereof or thereof may not be enforced in or
by such court and (c) hereby agrees not to commence or maintain any action, claim, cause of action
or suit (in contract, tort or otherwise), inquiry, proceeding or investigation arising out of or
based upon this Agreement or relating to the subject matter hereof or thereof other than before one
of the above-named courts nor to make any motion or take any other action seeking or intending to
cause the transfer or removal of any such action, claim, cause of action or suit (in
contract, tort or otherwise), inquiry, proceeding or investigation to any court other than one
of the above-named courts whether on the grounds of inconvenient forum or otherwise.
Notwithstanding the foregoing, to the extent that any party hereto is or becomes a party in any
litigation in connection with which it may assert indemnification rights set forth in this
agreement, the court in which such litigation is being heard shall be deemed to be included in

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clause (a) above. Notwithstanding the foregoing, any party to this Agreement may commence and
maintain an action to enforce a judgment of any of the above-named courts in any court of competent
jurisdiction. Each party hereto hereby consents to service of process in any such proceeding in
any manner permitted by New York law, and agrees that service of process by registered or certified
mail, return receipt requested, at its address specified pursuant to Section 9 hereof is
reasonably calculated to give actual notice.

     17. WAIVER OF JURY TRIAL. TO THE EXTENT NOT PROHIBITED BY APPLICABLE LAW WHICH CANNOT
BE WAIVED, EACH PARTY HERETO HEREBY WAIVES AND COVENANTS THAT IT WILL NOT ASSERT (WHETHER AS
PLAINTIFF, DEFENDANT OR OTHERWISE) ANY RIGHT TO TRIAL BY JURY IN ANY FORUM IN RESPECT OF ANY ISSUE
OR ACTION, CLAIM, CAUSE OF ACTION OR SUIT (IN CONTRACT, TORT OR OTHERWISE), INQUIRY, PROCEEDING OR
INVESTIGATION ARISING OUT OF OR BASED UPON THIS AGREEMENT OR THE SUBJECT MATTER HEREOF OR IN ANY
WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE TRANSACTIONS CONTEMPLATED HEREBY, IN EACH CASE
WHETHER NOW EXISTING OR HEREAFTER ARISING. EACH PARTY HERETO ACKNOWLEDGES THAT IT HAS BEEN
INFORMED BY THE OTHER PARTIES HERETO THAT THIS SECTION 17 CONSTITUTES A MATERIAL INDUCEMENT
UPON WHICH THEY ARE RELYING AND WILL RELY IN ENTERING INTO THIS AGREEMENT. ANY PARTY HERETO MAY
FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION 17 WITH ANY COURT AS WRITTEN
EVIDENCE OF THE CONSENT OF EACH SUCH PARTY TO THE WAIVER OF ITS RIGHT TO TRIAL BY JURY.

     18. Joint and Several Liability. Each obligation described herein of the Company,
HQCO and/or its subsidiaries, as the case may be, shall be a joint and several obligation of the
Company, HQCO and its subsidiaries. If requested by any of the Advisors, then the Company shall
cause any of its subsidiaries to sign a counterpart signature page to this Agreement to evidence
such joint and several liability. Upon an underwritten registered public offering of capital stock
of any subsidiary of the Company, the Advisors may cause such subsidiary (and its subsidiaries) to
be released from joint and several liability for obligations hereunder arising after the closing of
such offering, but this Agreement shall continue in full force and be binding on the Company and
all of its other subsidiaries.

     19. Certain Definitions. For purposes of this Agreement, the following terms shall
have the following meanings:

     “Affiliate” shall mean, with respect to any Person, (i) any other Person which
directly or indirectly through one or more intermediaries controls, or is controlled by, or is
under common control with, such Person (for the purposes of this definition, “control” (including,
with correlative meanings, the terms “controlling,” “controlled by” and “under common control
with”), as used with respect to any Person, means the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of such Person, whether
through the ownership of voting securities, by agreement or otherwise); provided,
however, that neither the Company nor any of its controlled Affiliates shall be deemed an
Affiliate of any of the Company’s shareholders (and vice versa) and none of the Company’s
shareholders shall be deemed Affiliates of each other solely as a result of their relationship with
respect to the

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Company, or (ii) if such Person is an investment fund, any other investment fund the
primary investment advisor to which is the primary investment advisor to such Person or an
Affiliate thereof.

     “Change in Control” shall have the meaning set forth in the Stockholders Agreement.

     “Initial Public Offering” shall have the meaning set forth in the Stockholders
Agreement.

     “Person” shall mean any individual, partnership, corporation, company, association,
trust, joint venture, limited liability company, unincorporated organization, entity or division,
or any government, governmental department or agency or political subdivision thereof.

     “Quarterly Fee Amount” shall mean (a) $1,250,000 per fiscal quarter for the Company’s
fiscal year 2005; and (b) for each fiscal year thereafter during the Term, an amount per fiscal
quarter equal to 105% of the applicable Quarterly Fee Amount for the immediately preceding fiscal
year.

     “Stockholders Agreement” shall mean that certain shareholders agreement of even date
herewith, by and among investment funds managed by SilverLake (Offshore) AIV GP II, L.P. or its
Affiliates, investment funds managed by KKR Millenium GP LLC, KKR Associates Europe, Limited
Partnership, KKR Associates Europe II, Limited Partnership or its Affiliates, an investment fund
managed jointly by KKR and SLP, Seletar Investment Pte. Ltd. and Geyser Investment Pte. Ltd., as
amended from time to time in accordance with its terms.

* * * * *

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          IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written
above.

	 	 	 	 	 	 	 
	 	 	COMPANY:	 	 
	 
	 	 	 	 	 	 
	 	 	AVAGO TECHNOLOGIES LIMITED	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Kenneth Y. Hao	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Kenneth Y. Hao	 	 
	 

	 	Its:
	 	Director	 	 
	 
	 	 	 	 	 	 
	 	 	AVAGO TECHNOLOGIES INTERNATIONAL

SALES PTE. LIMITED	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Kenneth Y. Hao	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Kenneth Y. Hao	 	 
	 

	 	Its:
	 	Director	 	 

Signature Page to Advisory Agreement

 

 

	 	 	 	 	 	 	 
	 	 	ADVISORS:	 	 
	 
	 	 	 	 	 	 
	 	 	SILVER LAKE MANAGEMENT COMPANY, L.L.C.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Alan K. Austin	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Alan K. Austin	 	 
	 

	 	Its:
	 	Managing Director and Chief Operating Officer	 	 

Signature Page to Advisory Agreement

 

 

	 	 	 	 	 	 	 
	 	 	KOHLBERG KRAVIS ROBERTS & CO., L.P.	 	 
	 
	 	 	 	 	 	 
	 	 	By: KKR & Co., LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ James H. Greene Jr.	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	James H. Greene Jr.	 	 
	 

	 	Its:
	 	Director	 	 

Signature Page to Advisory Agreementexv10w33

 

Exhibit-10.33

AMENDMENT

TO

PURCHASE AND SALE AGREEMENT

     This Amendment to the Purchase and Sale Agreement (“Amendment”) is entered
into effective as of March 1, 2006, by and among Avago Technologies Pte. Limited, a company
organized under the laws of Singapore (“Seller Parent”), Avago Technologies Storage Holding
(Labuan) Corporation, a company organized under the laws of Labuan (“Seller”), PMC-Sierra,
Inc., a Delaware corporation (“Purchaser Parent”), and Palau Acquisition Corporation, a
Delaware corporation (“Purchaser”) (each, a “Party” and collectively, the
“Parties”). All capitalized terms used and not otherwise defined herein shall have the
respective meanings assigned to such terms in the Purchase Agreement (as defined below).

Recitals

     A. The Parties entered into an Purchase and Sale Agreement dated as of October 28, 2005 (the
“Purchase Agreement”), pursuant to which (among other things) the Parties have agreed that
Purchaser shall purchase and assume from Seller and the Other Sellers, and Seller and the Other
Sellers shall sell, transfer and Assign to Purchaser, the Purchased Assets and Assumed Liabilities
of the Business, as well as the Purchased Subsidiary Interests, upon the terms and subject to the
conditions specified in the Purchase Agreement

     B. The Parties now wish to amend certain provisions of the Purchase Agreement.

Agreement

     NOW, THEREFORE, in consideration of these premises and of the mutual agreements,
representations, warranties and covenants herein contained, the Parties do hereby agree as follows:

SECTION 1. Amendment of Purchase Agreement

     1.1 Amendment of Section 3.2(a). Section 3.2(a) of the Purchase Agreement is hereby amended
and restated in its entirety to read as follows:

     3.2 Payment of Purchase Price.

     (a) On the Closing Date, Purchaser shall pay to Seller (for its own account and as
agent for any Other Seller unless otherwise provided in any Local Asset Transfer Agreement)
an amount equal to (i) Four Hundred Twenty-Five Million Dollars and no cents ($425,000,000),
(ii) plus or minus, as applicable, the difference between the Estimated Inventory (as
defined in Section 3.2(b)) at the opening of business on the Closing Date (without giving
effect to the Closing) and the Base Inventory, (iii) minus, if

 

 

applicable, the amount of any reduction in the Purchase Price pursuant to Schedule
3.2(a) and (iv) minus $412,000, which amount represents Seller’s estimate as of Closing of
its potential liability for Singapore stamp duties that will be paid by Purchaser in
accordance with Section 6.14(a). Such amount provided for in the immediately preceding
sentence shall be payable in United States dollars in immediately available federal funds to
such bank account or accounts as shall be designated in writing by Seller no later than the
second Business Day prior to the Closing.

     1.2 Amendment of Section 3.2(c). Section 3.2(c) of the Purchase Agreement is hereby amended
and restated in its entirety to read as follows:

     (c) Purchaser and Seller agree that to the extent that the Final Inventory exceeds the
Estimated Inventory, Purchaser shall pay to Seller (on behalf of itself and as agent for any
Other Seller) such excess (the “Inventory Excess Amount”), and to the extent that
the Final Inventory is less than the Estimated Inventory , Seller (on behalf of itself and
as agent for any Other Seller) shall pay to Purchaser such shortfall (the “Inventory
Deficiency Amount”), in each case pursuant to the terms of this Section 3.2. For
purposes of this Agreement, “Final Inventory” shall mean Inventory as of the opening of
business on the Closing Date (without giving any effect to the Closing or any step up or
step down in value for financial reporting purposes as a result of the closing of the
transactions contemplated by the Semiconductor Business Purchase Agreement) prepared on a
basis consistent with past accounting practice of the Business as determined pursuant to
this Section 3.2. As used herein, “Inventory” means the all inventory of the Business as
calculated and prepared in accordance with the past accounting practices of the Business,
but shall not include (i) any in-transit inventory of the Business that Seller has sold
prior to the opening of business on the Closing Date but that has not been shipped as of
such Closing Date, (ii) any SSD amounts accrued by the Seller prior to the Closing Date, and
(iii) any inventory relating to the Fort Collins Supply Agreement.

     1.3 Amendment of Section 6.14(e). Section 6.14(e) of the Purchase Agreement is hereby amended
and restated in its entirety to read as follows:

     (e) Indemnification. The Seller Parties shall indemnify, save and hold the
Purchaser Indemnified Parties harmless from and against any and all Purchaser Losses
incurred in connection with, arising out of, resulting from or incident to (i) any Taxes of
any of the Purchased Seller Subsidiaries or with respect to the Purchased Assets,
Transferred Business Intellectual Property or Transferred Business Intellectual Property
Rights for any Tax year or portion thereof ending on or before the Closing Date (or for any
Straddle Period, to the extent allocable to the portion of such period beginning before and
ending on the Closing Date, determined in accordance with 6.14(b)(iii)) (which, for the
avoidance of doubt, shall include any Taxes, whenever arising, resulting directly or
indirectly from the termination of any Tax holiday or similar incentive or from the
recapture of any Tax benefit that may be claimed by Seller or the Purchased Seller
Subsidiaries for any period or portion of any period ending on or prior to the Closing
Date); (ii) any failure of any representation or warranty of Seller or the Other Sellers set
forth in Section 4.10 to be true and correct; (iii) any Taxes arising out of or attributable
to

 

 

the acquisition of the Business from Angel; (iv) any withholding Taxes (whenever
arising) attributable to the payment of the Purchase Price; and (v) the unpaid Taxes of any
Person (other than either of the Purchased Seller Subsidiaries) under Treasury regulations
Section 1.1502-6 (or any similar provision of state, local or foreign law), as a transferee
or successor, by contract, or otherwise.

     1.4 No Other Amendments. Except as it has been specifically amended pursuant to Section 1,
the Purchase Agreement shall from and after the date hereof continue in full force and effect.

SECTION 2. Additional Provisions

     2.1 Entire Agreement and Modification. The Purchase Agreement (including the exhibits
thereto), as amended by this Amendment, constitutes the entire agreement among the Parties with
respect to the subject matter thereof and hereof and supersedes any prior understandings,
agreements, or representations by or among the Parties, written or oral, to the extent they related
in any way to the subject matter hereof and thereof. The Purchase Agreement, as amended by this
Amendment, may not be further amended except by a written agreement executed by all Parties.

     2.2 Counterparts. This Amendment may be executed in counterparts, each of which shall be
deemed an original but all of which together will constitute one and the same instrument.

     2.3 Headings. The Section headings contained in this Amendment are inserted for convenience
only and shall not affect in any way the meaning or interpretation of this Amendment.

     2.4 Severability. Any term or provision of this Amendment that is invalid or unenforceable in
any situation in any jurisdiction shall not affect the validity or enforceability of the remaining
terms and provisions hereof or the validity or enforceability of the offending term or provision in
any other situation or in any other jurisdiction.

[SIGNATURE PAGES FOLLOW]

 

 

     IN WITNESS WHEREOF, the Parties have caused this Amendment to the Purchase and Sale Agreement
to be duly executed as of the date first above written.

	 	 	 	 	 	 	 
	 	 	AVAGO TECHNOLOGIES PTE. LIMITED	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Adam H. Clammer 	 	 
	 

	 	 	 	 

	 	 
	 

	 	Name:	 	Adam H. Clammer 	 	 
	 
	 	 	 	 	 	 
	 

	 	Title:	 	Director 	 	 
	 
	 	 	 	 	 	 
	 	 	AVAGO TECHNOLOGIES STORAGE HOLDING (LABUAN) CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Adam H. Clammer 	 	 
	 

	 	 	 	 

	 	 
	 

	 	Name:	 	Adam H. Clammer 	 	 
	 
	 	 	 	 	 	 
	 

	 	Title:	 	Director 	 	 

[SIGNATURE PAGE OF SELLER PARENT AND SELLER TO THE AMENDMENT TO

THE PURCHASE AND SALE AGREEMENT – PURCHASER’S SIGNATURE PAGE

FOLLOWS]

 

 

	 	 	 	 	 	 	 
	 	 	PMC-SIERRA, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Alan Krock 	 	 
	 

	 	 	 	 

	 	 
	 	 	Name: Alan Krock	 	 
	 
	 	 	 	 	 	 
	 	 	Title: Vice President, Chief Financial Officer	 	 
	 
	 	 	PALAU ACQUISITION CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Alan Krock 	 	 
	 

	 	 	 	 

	 	 
	 	 	Name: Alan Krock	 	 
	 
	 	 	 	 	 	 
	 	 	Title: Vice President, Chief Financial Officer	 	 

[SIGNATURE PAGE OF PURCHASER PARENT AND PURCHASER TO THE

AMENDMENT TO THE PURCHASE AND SALE AGREEMENT]

-5-

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