This is with regards to our discussion from which you requested us to advise for an M&A case in Vietnam.  Thus, we are pleased to present herewith our Legal Service Proposal for your kind reference.

1.Scope of works

With regards to the M&A case, our scope of work shall be as follows:

Due diligence research

· Conducting legal due diligence reviews in respect of the Assignor and producing a legal due diligence report in English covering specific matters, including due incorporation, historical and existing shareholdings, identity of senior officers, major business licenses, major corporate documents, continued existence of the Assignor (including winding-up)and proper fillings (including all tax fillings),registrations with various authorities in Vietnam, particulars of any actual or threatened litigation, arbitration or administrative proceedings concerning Assignor in Vietnam;

· Preparing a legal opinion in English as to the laws of Vietnam, addressed to and for the benefit of, including but not limited to, Client, covering matters relating to the Assignor for the purposes of acquisition;

· Answering queries from Client related regulators in respect of Vietnamese law issues and matters relating to the Assignor;

Preparation of the frameworks agreements:

  • Collection of necessary information regarding to the targeted transaction;
  • Preparation of frame agreements including Memorandum Of Understanding and Capital Transfer Agreement in order to best protect Client’s right and interest under VietnamLaw;
  • Liaising with Client to discuss first drafted Memorandum Of Understanding and Capital Transfer Agreement, if any; and update it according to Client’s comments
Preparation of the application documents:

  • Notifying application documents required in accordance with Vietnamese law;
  • Drafting application documents required for obtaining approval from Competent Authority;
  • Liaising with Client to discuss the draft application documents;
  • Amending the application documents based on Client’s comments;
  • Obtaining preliminary comments from the licensing authority on the draft application documents;
  • Finalizing the application documents following comments from the licensing authority; and
  • Translating the final version of the application documents into Vietnamese for execution.
Licensing procedures:

  • Submitting the application dossier to the licensing authority on Client behalf;
  • Monitoring and following up with the relevant authorities on the approval process;
  • Keeping Client updated on the developments and additional requirements, if any; and
  • Assisting Client in obtaining the approval letter and updating the Certificate of business registration.

The roadmap for a M&A case can be described in following steps as follows:

Step 1:Due diligence Study

  • The due diligence will be based essentially on results from searches of public records (if available) and documents provided by the Assignor and/or Client, and the relevant parties will cooperate to provide documents requested in full and in a timely manner;
  •  While it may be necessary to work on-site at the Assignor, such field work (if any) will be limited to two or three days;
  • The due diligence documents will be available in Vietnamese or English;
  • Communication will be in English, and will mostly be via email and telephone;
  • For litigation and insolvency searches, there is virtually no public record in Vietnam, nor are court dockets available. SB Law will conduct general searches on public sources (such as the internet, certain online databases of governmental agencies, if any), and the information may be limited;
  • Structure of the transaction based on information known by SB Law, and our experience in similar cases. However, each transaction is different, and the transaction referred to above may develop differently than the parties anticipated, the scope of work may be enlarged to cover aspects not initially covered, and so on. In such case, if our estimated fees are exceeded, SB Law will also be entitled to discuss with Client to revisit our fees.

Step 2: Preparation of Frame Agreements:

  • Based on actual status of Assignor and Vietnam legal policies as described in Due Diligence Report, we shall prepare Frame Agreements to reflect mutual agreements between Client and Assignor;
  • Conference Call or Meeting between Client/Client’s Lawyer with us may be required during the process of preparation of Frame Agreements.
  • Updating and finalizing the Frame Agreements according to Client’s comments.

Step 3: Obtaining approval for acquisition of 100% equity of the Assignor:

  • Collection of required documents: We shall collect necessary information and documents from Client and the Assignor.
  • Preparing the application dossier: We shall collect necessary information and documents from Client. Upon receipt of necessary information and documents from Client. The initial drafted application dossier shall be sent to you for your comments. Then, after updating the application dossier based on Client’s comments, we shall obtain the preliminary comments from the competent authority and send the finalized application dossiers for you to sign and seal.
  • Submission of application dossier:Within 02 working days from receipt of duly signed and sealed application dossier, we shall submit the application dossier to the competent authority. It shall take about 15 working days from submission of application dossier to the competent authority to grant the approval. In practice, it can be longer due to that it takes time for the competent authority to consult relevant Ministries before granting the Approval.

Step 4: Amendment of the Certificate of Business Registration

  • Preparing the application dossier: We shall collect necessary information and documents from Client. Upon receipt of necessary information and documents from Client, we shall translate documents from English into Vietnamese and prepare the application dossier under the standard forms. The initial drafted application dossier shall be sent to Client for comments. Then, after updating the application dossier based on Client’s comments, we shall obtain the preliminary comments from the competent authority and send the finalized application dossiers for Client to sign and seal. We anticipate that this phase shall be completed within 02 working days.
  • Submission of application dossier:Within 02 working days from receipt of duly signed and sealed application dossier, we shall submit the application dossier to the competent authority. It shall take about 05 working days from submission of application dossier for the provincial licensing authority to grant the Amended Certificate of Business Registration.
  • Post licensing:Within 13 working days we shall complete the post licensing procedures.

2.Professional fee

2.1. SB Law professional fees for the scope of work as stipulated at Item 4 shall be based on the actual time our lawyers/consultants work on the services(s) for which we have been retained. Hourly rate of our Lawyers is follow:

Director : 350USD
Partner : 300USD
Senior Associate : 250USD
Associate : 200USD
Paralegal : 80USD

Our Lawyer and Consultations keep track their time in minutes to the nearest 10 minutes and record their time daily. Time record notations are made for any and all work performed, including but not limited to, office conferences, legal research, preparation of legal instruments, telephone and personal trips to and from the offices to relative places or client’s offices.

Where SB Law offers an estimate for services based on hourly rates, such estimate may not adequately reflect the amount ultimately undertaken by SB Law in order to deliver the services. In case the actual amount of work required by SB Law exceeds our initial estimate, SB Law will advise of any possible excess such estimate.

2.2. Services fee shall be paid to SB Law as follows:

  • Within 03 working days from the date of signing the legal service contract, Client will pay for SB Law an advance payment which equivalent to 45% of the total estimated services fee.
  • Client will pay30% of the total estimated services feewithin 03 working days from obtainment of approval from competent authority for acquisition of equity from the Assignee;
  • Client will pay the remained fee and other cost and disbursement incurred on Client’s behalf within 05 working days from obtainment the amended Certificate of Business Registration for Client from SB Law.
  • Client shall immediately notify SB Law of when actual payment(s) will be made on the amount specified in the invoice(s). SB Law will start working only upon receipt of payment of the respective invoice(s). Alternatively, SB Law reserves the right to withdraw the service if payment is not received 10 days after the date of the invoice. Further, in the event payments are not received by the payable date, SB Law reserves the right to suspend services and/or levy and collect a late payment fee of 0.5% per month up to the date of receipt of payment by SB Law.
  • In case the Legal Service Contract is terminated before the expiry date, SB Law shall be entitled to payment of the percentage of services carried out upon the total of the services up to the date of such termination.
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