Financial Advisory Agreement
This
FINANCIAL ADVISORY AGREEMENT (hereinafter referred
to as “ this Agreement ”) is made and
entered into on the 15 th day of October 2006 in Beijing.
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(1)
BEIJING HOLLYSYS CO., LTD. , HANGZHOU
HOLLYSYS AUTOMATION CO., LTD. and their
shareholders
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(2) And
any new companies established by the shareholders
of Beijing HollySys Co., Ltd. and Hangzhou HollySys Automation Co.,
Ltd. for the purpose of reverse merger with
the target company listed on OTCBB in U.S.
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UPPER
MIX INVESTMENTS LIMITED, and
TIME
KEEP INVESTMENT LIMITED
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Party A is
incorporated and validly existing under the Company Law of the
People’s Republic of China ;
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Party B is an
investment advisory and management company incorporated in British
Virgin Island with limited liability; and
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Party A is
aimed at listing on the U.S. OTCBB and switching to Nasdaq through
SPAC model. Party A hence engages Party B as the Financial Advisor
to propose plans and advises on the merger and acquisition
transaction with SPAC listed on OTCBB in U.S.(hereinafter referred
to as “Target Company ”) and the
switch from OTCBB to Nasdaq after the above transaction.
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NOW
THEREFORE , Party A
and Party B enter into this Agreement through mutual negotiation
based on the following conditions:-
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1.1
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Party A has
entrusted Party B with privileges to represent in the capacity of
Party A’s Financial Advisor in the M&A and NASDAQ listing
(hereinafter referred to as “the Transaction
”) related procedures for the Target Company.
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1.2
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Party B, while
representing in the capacity as Party A’s Financial Advisor
in the Transaction related procedures for the Target Company, is
obligated to provide financial advices including but not limited
to:
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(1)
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Get financials
of Party A in readiness for audit and asset evaluation;
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(2)
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Propose sound
advices for the Transaction as well as providing feasible business
restructuring plans and assisting in the effective implementation
of such plan;.
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(3)
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Cooperate and
communicate between Party A and other parties related to the
Transaction, including government agencies and intermediate
agencies;
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(4)
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Participate in
negotiations with the Target Company as required by Party
A;
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(5)
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Analyze and
solve issues raised from the transaction with other
parties;
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(6)
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Conduct any
other necessary consulting services related to the Transaction;
and
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(7)
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Arrange Due
Diligence on Target Company and other works related to the
Transaction.
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Party B, as the
Financial Advisor of Party A for the Transaction, shall achieve the
following objectives:
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Achieving the
minimum pricing in common shares received by Party A from Target
Company is no less than 16,000,000 (including
16,000,000);
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Party A
receiving above 50% interest of equity of Target
Company;
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Party A
controlling the Board of Directors of Target Company;
and
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Listing on
Nasdaq upon consummation of the Transaction.
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This Agreement
shall come into effective upon signature date and expire upon the
consummation of the Transaction. During the period of entrustment,
Party A agrees that if Party A entrusts any other financial
advisory or consulting third parties with any activities related to
the Transaction with the Target Company as the Commitment set forth
in this Agreement, Party B shall have the right to charge Party A
with all the advisory services fee set force in this
Agreement.
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4.
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RIGHTS
AND OBLIGATIONS
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4.1
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Party A’s
Rights and Obligations
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4.1.1
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Party A shall
provide valid and completed information and documents necessary for
Party B to enforce the Agreement, including but not limited to the
documents, accounting information and any information requested by
Party B for fulfilling the obligations as the Financial
Advisor;
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4.1.2
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Party A agrees
to actively cooperate with Party B to complete entrusted works in
time; and
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4.1.3
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Party A agrees
to pay related expenses, including Financial Advisory Fee,
etc.
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4.2
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Party B’s
Rights and Obligations
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4.2.1
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On the need-to
basis, Party B shall rectify the financial activities of Party A
and the affiliated companies of Party A, prepare Business Plan for
the restructuring company, provide reasonable advices on the
organization structure, actively prepare documents (both in English
and Chinese) related to the Transaction, and facilitate the
Transaction for Party A;
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4.2.2
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Party B shall
complete the entrusted works in time and within the period of this
Agreement; and
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4.2.3
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Party B has the
right to sub-contract part of the services specified in this
Agreement to other Chinese companies designated by Party
B.
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5.
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CONSIDERATION AND TERMS OF
PAYMENT
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5.1
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Financial
Advisory Fee
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5.1.1
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Both Parties
agree that the entrance fee payable by the Party A to Party B shall
be US$ 50,000;
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Both Parties
agree that Financial Advisory Fee payable by Party A to Party B
upon the consummation of the Transaction shall consist of the
following three parts (Consideration of the Transaction comprises
of consideration in cash, common shares and contingent incentive
shares):
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5.1.2
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Consideration
in cash: shall be 5% of the total cash consideration of the
Transaction;
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5.1.3
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Consideration
in common shares: Common shares received by Party A from Target
Company is no less than an aggregate of 16,000,000.
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(a)
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If the sum of
common shares received by Party A from Target Company is no less
than an aggregate of 16,000,000 (including 16,000,000) and no more
than an aggregate of 18,000,000 (including 18,000,000), Party B
shall receive 2.222% of the total consideration in common
shares;
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(b)
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If the sum of
common shares received by Party A from the Target Company is
abov
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