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Financial Advisory Agreement

Consulting Services Agreement

Financial Advisory Agreement | Document Parties: CHARDAN NORTH CHINA ACQUISITION CORP | BEIJING HOLLYSYS CO., LTD | HANGZHOU HOLLYSYS AUTOMATION CO., LTD You are currently viewing:
This Consulting Services Agreement involves

CHARDAN NORTH CHINA ACQUISITION CORP | BEIJING HOLLYSYS CO., LTD | HANGZHOU HOLLYSYS AUTOMATION CO., LTD

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Title: Financial Advisory Agreement
Date: 2/14/2007

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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.

 

BETWEEN :

 

Party A:

(1) BEIJING HOLLYSYS CO., LTD. , HANGZHOU HOLLYSYS AUTOMATION CO., LTD. and their shareholders

 

(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.

 

Party B:

UPPER MIX INVESTMENTS LIMITED, and

TIME KEEP INVESTMENT LIMITED

 

 

WHEREAS:

 

1.

Party A is incorporated and validly existing under the Company Law of the People’s Republic of China ;

 

2.

Party B is an investment advisory and management company incorporated in British Virgin Island with limited liability; and

 

3.

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.

 

NOW THEREFORE , Party A and Party B enter into this Agreement through mutual negotiation based on the following conditions:-

 

1.

COMMITMENT

 

 

1.1

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.

 

 

1.2

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:

 

1


 

 

(1)

Get financials of Party A in readiness for audit and asset evaluation;

 

(2)

Propose sound advices for the Transaction as well as providing feasible business restructuring plans and assisting in the effective implementation of such plan;.

 

 

(3)

Cooperate and communicate between Party A and other parties related to the Transaction, including government agencies and intermediate agencies;

 

(4)

Participate in negotiations with the Target Company as required by Party A;

 

 

(5)

Analyze and solve issues raised from the transaction with other parties;

 

(6)

Conduct any other necessary consulting services related to the Transaction; and

 

 

(7)

Arrange Due Diligence on Target Company and other works related to the Transaction.

 

 

2.

OBJECTIVE

 

Party B, as the Financial Advisor of Party A for the Transaction, shall achieve the following objectives:

 

 

2.1

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);

 

2.2

Party A receiving above 50% interest of equity of Target Company;

 

 

2.3

Party A controlling the Board of Directors of Target Company; and

 

2.4

Listing on Nasdaq upon consummation of the Transaction.

 

3.

PERIOD OF ENTRUSTMENT

 

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.

 

 

4.

RIGHTS AND OBLIGATIONS  

 

4.1

Party A’s Rights and Obligations

 

4.1.1

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;

 

4.1.2

Party A agrees to actively cooperate with Party B to complete entrusted works in time; and

 

2


 

4.1.3

Party A agrees to pay related expenses, including Financial Advisory Fee, etc.

 

4.2

Party B’s Rights and Obligations

 

4.2.1

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;

 

4.2.2

Party B shall complete the entrusted works in time and within the period of this Agreement; and

 

4.2.3

Party B has the right to sub-contract part of the services specified in this Agreement to other Chinese companies designated by Party B.

 

5.

CONSIDERATION AND TERMS OF PAYMENT

 

5.1

Financial Advisory Fee

 

5.1.1

Both Parties agree that the entrance fee payable by the Party A to Party B shall be US$ 50,000;

 

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):

 

5.1.2

Consideration in cash: shall be 5% of the total cash consideration of the Transaction;

 

5.1.3

Consideration in common shares: Common shares received by Party A from Target Company is no less than an aggregate of 16,000,000.

 

(a)

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;

 

(b)

If the sum of common shares received by Party A from the Target Company is abov


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