[ ] CO., LTD
Propod RTO and Financing on Over the Counter Bulletin Board
Legal Due Diligence Report
[ ](the “Company”).
the Company’s offshore holding company with an OTCBB shell company and financing (the “Project”).
This Legal Due Diligence Report (this “Report”) is prented on the following bas:
1. The information contained in this Report is primarily bad on:
(i) information and documentation supplied by the Company in respon to the information
sought in the due diligence questionnaire and our further requests for supplemental information and documentation;
(ii) discussions with the directors, management and staff of the Company;
(iii) a arch of the public records of the Company available for inspection at relevant PRC authorities in charge of administration for industry and commerce1;
2. In reviewing the documentation supplied to, or obtained by, us we have assumed that:
(i) all copies made from original documents are true and complete and that such original
documents are authentic and complete;
(ii) all documents supplied to, or obtained by, us as originals are authentic and complete;
(iii) all signatures appearing on documents supplied to, or obtained by, us as originals or copies of originals are genuine;
(iv) the Company has the requisite corporate power to enter into all contractual arrangements to which it is a party and to perform its obligations thereunder;
(v) all contractual documents have been duly authorid, executed and delivered by the parties thereto and constitute legally enforceable obligations of the parties under the laws of relevant jurisdictions;
(vi) the Company has not pasd a voluntary winding up resolution and that no petition has been prented to or order made by any court for the winding up or administration of the Company and that no receiver has been appointed in relation to the Company or any of its asts or revenue;
(vii)the Company has drawn to our attention all matters relevant to our information requests.
3. This Report is subject to the following qualifications:
(i) we have not attempted independently to verify the authenticity and completeness of any
original documents by contacting third parties;
(ii)this Report does not of itlf constitute a verification exerci;
1 Such public records were provided to us by the Company.
(iii) we are qualified to practice law only in the People’s Republic of China and we express no opinion as to any other laws;
(iv) we have not investigated and have not attempted to comment on the commercial, financial ,technical or accounting implications of documents which have been supplied to, or obtained by, us or make any asssment of the current financial condition of the Company;
(v) we have not investigated and make no comment on the adequacy of the Company’s insurance cover;
(vi) this Report is by its nature a factual analysis and a legal review of the information supplied to us and should not be regarded as, or relied upon as being, a comprehensive or formal legal opinion concerning any matter referred to in it;
(vii) we accept no responsibility whatsoever to update this Report for events or circumstances occurring after the date of this Report and cannot accept responsibility for information supplied to us by, or obtained by us from, third parties which may have become out of date at the date of this Report;
(viii) this Report is not to be construed as advice on whether or not to proceed with the Project.
Instead, regard should be had to a variety of other factors, commercial, financial, technical, accounting and otherwi, which come or should come, to the notice of the addres of this Report by means other than legal due diligence;
(ix) there can be no assurance that the information supplied to, or obtained by, us is complete or accurate in all respects or that there is no material information in relation to the Company of which we have not been made aware.
The addres of this Report should be aware that circumstances such as laws which are applicable in an insolvency, receivership, administration or creditors rights generally may affect the enforceability, performance or validity of agreements summarid in this Report.
This Report makes fair disclosure of the legal matters which are referred to in it. However, we accept no responsibility whatsoever for any inaccuracy or incompleteness in this Report to the extent that any inaccuracy or incompleteness of the information and/or documentation on which we report would not be apparent from a careful and thorough appraisal of such information and documentation as it has been supplied to, or obtained by, us and reviewed and after appropriate enquiry arising therefrom.
This Report is limited to the effect of the laws of the People’s Republic of China as they, and the facts bearing upon this Report, existed on the date of this Report. We expressly disclaim any obligation or undertaking to update or modify this Report as a conquence of any future changes in such laws or in any facts bearing upon this Report. Additionally, we have not investigated, and we do not express or imply any view or opinion on, or in respect of, the laws of any country other than the PRC, and we have assumed that no such other laws would affect the contents contained in this Report.
This Report is addresd solely to you for your benefit and for the purpo of the Placing and Project. It should not be shown, communicated or disclod to any other person nor relied upon by any other person or for any other purpo. It must not be quoted or referred to in any public document or filed with any person without our prior express written connt.
Yours faithfully
CONTENTS
1.Corporate matters 7
2.Licens, approvals and regulation 12
3.Banking arrangements and borrowings 16
4.Contracts 18
5.Real Property 19
6.Directors, nior executives and other employees 20
7.Intellectual property 21
8.Litigation 22
9.Insurances 23
10.Environmental 24
11.Prize and Honour 25
Definitions
The following definitions are ud in this Report:
In this Report, the phra “we are informed” means we are informed by directors, management and staff of the Company, either verbally or in writing.
References to Sections and Paragraphs are to ctions and paragraphs of this Report.
