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尽职调查文件清单
Documentation Request List for Legal Due Diligence
Instructions
This Documents Request List (the “Request”) has been prepared for the purpose of conducting legal due diligence on [X] (the “Company”).
Subsidiaries of the Company with an independent legal person status are not included in the Request. If necessary, a separate request for the subsidiary may be provided. Branches, departments, offices and other entities of the Company without an independent legal person status are included in the Request.
Documents asked for implies copies of such documents, unless otherwise specified. For each item below, it should be assumed that all documents that satisfy the criteria stated are requested, even though “all” may not be explicitly stated.
For each item below, if all relevant documents have been provided, please check the box to the right to indicate that the item of request has been satisfied.
If information or materials asked for is: (i) not applicable to the Company, (ii) applicable, but not expected to be available, or (iii) will be provided at a later date, please provide a separate response or explanation as appropriate.
If, prior to the closing of the transaction, any event occurs or you obtain any additional facts that have a material effect on the information provided in response to the Request, please inform us immediately.
“Official documents” refers to approvals, certificates, licenses, contracts, formal applications, etc.
A government authority includes its local or subordinate organs.
“Recent” or “recent years” means the past [X] years, unless otherwise specified.
“Material amount” refers to [¥X].
“Affiliate” refers to:
1) The parent company of the Company;
2) The subsidiaries of the Company;
3) Other companies under the control of a same parent company of the Company;
4) The investors having joint control over the Company;
5) The investors having significant influence on the Company;
6) The joint ventures of the Company;
7) The associated companies of the Company;
8) The principal individual investors and the close family members of such individuals. “Principal individual investors” refers to an individual investor who can control or jointly control a company, or has significant influence on a company;
9) The key managers of the Company or of its parent company and their close family members. “Key managers” refer to the managers who have the authority and responsibility for planning, directing and controlling the activities of the Company. The close family members of a principal individual investor or of a key manager refer to the family members who may influence, or be influenced by, that individual in dealing with transactions with the Company.
10) Other companies which are controlled or jointly controlled by the principal individual investors, or key managers, or the close family members of such individuals, or on which the principal individual investors, or key managers, or the close family members of such individuals have significant influence .
Practitioner’s Notes
This document request list is adapted for privately-owned limited companies in the PRC. However, appropriate revisions should be made for each target company.
For example, it should not be used without substantial revisions for state-owned companies, agricultural enterprises, listed companies or companies that issue securities.
PLEASE PROVIDE THE FOLLOWING:
1. Basic Information
Practitioner’s Notes
Give an introduction to the Company.
1.1Current business license, showing latest annual inspection
1.2 If the Company is part of a group, the shareholding structure of such group in a chart showing all important relationships and connections between the group companies (including holding of shares in trust), as well as each company’s country of incorporation
1.3Internal organization chart and other information showing departments and authority of officers
1.4A list of cities and countries where the Company’s assets (tangible and intangible) and employees are located
1.5List of current directors, supervisors and senior officers of the Company and their letters of appointment
1.6Authorizations given by the board or by directors to specially-appointed agents to deal with some particular matter
1.7 Reports recently prepared by the Company regarding business and important matters facing the Company
2. Historical Changes
Practitioner’s Notes
Show that the Company was duly established and lawfully exists.
Highlight major historical changes to the Company.
2.1Prior to the establishment of the Company:
(1) resolutions & minutes of meeting of promoters
(2) agreements entered into by the promoters
2.2 At the Company’s establishment or during major change to the Company:
(1) feasibility study reports, project proposals and other applications submitted to government authorities for the purpose of approving the intended business activities of the Company
(2) official documents from or to government authorities relating to the above, including if applicable approvals from government regulators for certain industries or classes of companies (such as approval from MIIT for telecommunications companies, or for a project encouraged by the state, a certificate to that effect)
(3) SASAC approval if state-owned assets are involved
2.3 Since the establishment of the Company until the present
(1) business licenses, including any amendments and showing all annual inspection passed
(2) amendments to information registered with AIC
(3) AOA, including any amendments
(4) JV contracts (if applicable), including any amendments
(5) capital verification reports; asset appraisal reports for in-kind contributions
(6) MOFCOM approvals for FIE establishment, including any amendments and showing all annual inspection passed
(7) organizational code certificates, including any amendments and showing all annual inspection passed
2.4 For all changes to the AIC registered information (such as amendment of AOA, amendment of JV contracts, increase of capital, change of directors, change of business scope, acquisition, merger, divestiture, restructuring, etc.)
(1) shareholder and board resolutions of the Company
(2) contracts relating to such change or transaction
(3) shareholder and board resolutions of other parties to such transaction
3. Shareholders
Practitioner’s Notes
Allow a potential investor to assess other shareholders and their potential impact on the value or activities of the Company.
3.1 General information regarding the shareholders (including whether any are state-owned enterprises or FIE) and historical dealings / interactions among them
3.2 Business license or personal identification card of shareholders
3.3 Any agreements among some or all shareholders regarding the Company
4. Financing
Practitioner’s Notes
Provide information on the extent of the Company’s debt obligations (including guarantees of debts).
Assess whether such debts are in compliance with the law, such as foreign exchange laws.
Discover anything that may cause default on the debts.
4.1SAFE official documents, such as foreign exchange registration certificate, foreign debt registration certificate and foreign debt repayment approvals, including any amendments and showing all annual inspection passed
4.2 MOF official documents, such as the financial registration certificate, including any amendments and showing all annual inspection passed
4.3Contracts relating to all debt, financing or guarantees, including those relating to security interests (mortgages, pledges, liens, etc.) and credit facilities
4.4 Information and documents relating to the performance of the above contracts, including:
(1) whether all reporting and registration requirements have been complied with
(2) whether all material covenants including financial covenants/ratios have been complied with
(3) whether any event of default has occurred
(4) whether any notice or demand has been served on the Company in relation to default or non-compliance with any of the provisions of loan or security documentation
(5) any further action taken by lenders to enforce any security interests (e.g. appointment of receivers, commencement of winding up proceedings etc.)
4.5Receipts or documents from the bank showing payments made on debt
4.6Information and documents relating to bank accounts (of all types) of the Company
4.7Information and documents relating to other financial arrangement other than banking loan with the Company, including cash advances, financial lease, deferred payment arrangements, sale and leaseback, swaps, hedges and similar risk management arrangements, debentures, bonds, notes or similar debt instrument issued by the Company
4.8Potential factors that may cause the Company to default on its debts or other payables
4.9Audited annual financial reports for recent years, semi-annual reports and quarterly financial reports for year-to-date
4.10 Current and future financial plans and budgets
5. Investments, Loans and Security Interests
Practitioner’s Notes
Provide information on the equity and debt relationships between the Company and its affiliates.
Assess whether such investments, loans and security interests are in compliance with the law.
Assess the value and risk of such investments, loans and security interests.
5.1 Information on shares of other companies owned by the Company, including:
(1) share certificates
(2) AIC registration of the subsidiary showing the Company as a shareholder
(3) contracts entered into in relation to the purchase or establishment of such companies, such as share purchase agreement or JV contract
(4) shareholder and board resolutions relating to the purchase or establishment of such companies
(5) documents indicating any pledge on the shares
(6) if any government approval is required for the Company to hold such shares (such as an offshore investment), the relevant approva
5.2 Information on debts owing to the Company (directly or indirectly), including:
(1) contracts with the Company as the lender, including those relating to mortgages and security interests
(2) shareholder and board resolutions relating to provision of such loans
(3) receipts or documents from the bank showing payments made on such loans
(4) anything that may indicate the debt is difficult to collect
(5) contracts relating to a security interest in favor of a third party on debt owing to the Company
5.3 Information on security interests owned by the Company (e.g. mortgages, pledges, liens, etc.), including:
(1) contracts
(2) registration documents from government authorities
(3) documents indicating the seniority of such security interests
(4) information on the value of the underlying collateral
6. Tax
Practitioner’s Notes
Assess whether the Company has any outstanding tax obligations.
Assess whether the Company is in compliance with tax regulations.
6.1 Official documents from or to the state tax authority, local tax authority and customs of recent years, including:
(1) state and local tax registration certificate, including any amendments and showing all annual inspection passed
(2) tax filings provided to and payment verification issued by all tax authorities, including for income tax, value-added tax, business tax, etc.
(3) approval letters regarding exemptions, preferential treatment, tax holidays, etc.
(4) those relating to expected, ongoing or recent audits, investigations or duty disputes (include any statements from the Company)
(5) levy and exemption certificate for import / export
6.2 A statement of taxes currently payable and its calculation
7. Employment
Practitioner’s Notes
Give information on the Company’s human resources system.
Assess the risk of non-compliance with employment, immigration or social insurance laws.
7.1 Information regarding the human resources of the Company
(1) total number of personnel in each department or grade (management, labor, etc.)
(2) employee’s handbook and other internal rules & regulations, including a description of how they are formulated, revised and publicized
(3) overtime policy, including whether the Company arranges for alternative rest periods or for overtime payment and whether such policy is adhered to
(4) actual numbers of overtime hours worked by each employee
(5) stock options for employees and other benefits
7.2 Relevant contracts, such as:
(1) Employment contracts and contracts for training, confidentiality, non-disclosure and non-competition between the Company and senior management and key technical personnel
(2) Employment form contract(s) used by the Company, including full-time, part-time and foreign employees
(3) Form contracts for training, confidentiality, non-disclosure and non-competition
(4) Form contracts with independent contractors, such as interns and retirees
(5) Labor dispatch agreement and service outsourcing agreement
7.3 Work permits and residence permits for foreign employees
7.4 Documents relating to social insurance and housing fund compliance:
(1) social insurance registration certificate and housing fund account establishment certificate
(2) proof that the Company has fully paid social insurance and housing fund for all its employees
(3) proof of payment for unions and workplace health compensation
7.5 Proof of employee’s income tax withholding during the last 3 months
7.6 Information and documents relating to labor unions that the Company’s workers belong to
7.7 Information and documents relating to any potential, ongoing or recent employment / labor disputes
8. Environment
Practitioner’s Notes
Provide information about activities of the Company that may be regulated under environmental laws.
Assess any risk of non-compliance with environmental laws.
8.1 Official documents from or to environmental authorities or those having some jurisdiction over environmental matters, including:
(1) environmental licenses, registrations, assessments
(2) permits and approvals relating to urban planning, water, air quality, solid waste disposal, oil and gas transport and storage
8.2 Information about environmentally sensitive activities that are or may be regulated, including:
(1)information and documents regarding hazardous, contaminating or polluting materials owned, used, deposited or otherwise handled by the Company
(2) internal environmental policy and whether such policy is adhered to; for example, the permitted amount of waste water to be discharged, the discharge standards and the penalty rate for excess discharge
(3) any major policy changes or physical additions / changes made in recent years to comply with environmental laws and those expected to be made in the near future
8.3 Information and documents relating to any potential, ongoing or recent investigations, penalties or disputes with the government or third party regarding environmental issues
9.Material Contracts
Practitioner’s Notes
Obtain disclosure of contracts whose performance is vital to the survival or success of the Company or contain terms or have counterparties that may create risk for the Company.
The practitioner should define and explain the technical terms below to the Company so that they can provide the proper documents.
9.1 Information and documents relating to contracts (not otherwise disclosed):
(1) where the contract sum is over the material amount
(2) entered into between the Company and at least one affiliate or between at least two affiliates
(3) not entered into on arm’s length terms
(4) that are confidentiality or non-disclosure contracts
(5) with a performance period expected to be in excess of 6 months
(6) with terms that are particularly onerous to the Company or, conversely, particularly valuable to the Company
(7)thought by the Company to be invalid or unenforceable
(8)where the counterparty is believed to be insolvent or incapable of meeting its obligations
(9) which require government approval for it to be valid (also provide such approval)
9.2 Information and documents relating to execution of the above contracts, including:
(1) whether all reporting and registration requirements in respect of the above transactions have been complied with
(2) whether all material covenants have been complied with
(3) whether any event of default has occurred
(4) whether any notice or demand has been served on the Company in relation to default or non-compliance with any of the provisions of the above contracts or transactions
(5) any further action taken by other parties to the above contracts or transactions to enforce any security interests (e.g. appointment of receivers, commencement of winding up proceedings etc.)
10. Disputes
Practitioner’s Notes
Obtain disclosure of disputes that may materially affect or create risk for the Company.
10.1 Information and documents relating to potential, ongoing or recent claims, investigations, disputes, administrative penalties, arbitrations and court proceeding involving the Company or its shareholders, subsidiaries, senior officers and directors, including their status and resolution, where:
(1) more than the material amount is in dispute
(2) it is otherwise material to the affairs of the Company
11.Government Authorizations Pertaining to the Company’s Business
Practitioner’s Notes
Items in this section must be adapted to the particular line of business of the Company.
For regulated industries, certain activities require the explicit authorization of the regulator.
Some business activities also involve other government authorities, such as customs.
11.1【X】
12. Land and Buildings
Practitioner’s Notes
Give information about the Company’s land and building title.
Give information about the Company’s ongoing construction projects.
Assess any non-compliance or risks relating to such land, building and ongoing construction projects.
12.1 Basic information regarding land, buildings and construction projects owned by the Company, including:
(1) location
(2) land area and gross floor area
(3) intended use
(4) value / amount invested
(5) whether there is any joint ownership, profit division, “dian rights,” easement, leaseholds or other third-party involvement in the property
12.2 Information regarding premises leased by the Company, including:
(1) lease contract and associated documents
(2) lease registration documents
(3) information regarding the lessors showing they have the right to the premises
(4) receipts showing status of rent payment
12.3 Information and documents regarding ongoing construction projects, including:
(1) time when project was submitted to the construction authorities, when construction commenced, construction progress and expected completion date
(2) timing requirements stipulated by the authorities
(3) contractors, construction supervisors
(4) status of payments (including receipts)
12.4 In relation to each land, building and construction project owned by the Company, all official documents from or to construction, environment, land, planning and other authorities, including:
(1) land grant contract, land transfer contract or land allocation approval
(2) documents relating to completion of land requisition and relocation and payment of all fees for land requisition and relocation
(3) receipt showing full payment of consideration for the land and all taxes (including deed tax, stamp tax, value-added tax)
(4)land use certificate, and documents showing any security interest on the land
(5) environmental assessment report (and its approval)
(6) geological disaster assessment report (and its approval)
(7) construction engineering planning permit
(8) construction land use planning permit
(9) construction commencement approval
(10) acceptance inspection
(11) building title certificate, and documents showing any security interest on the building
(12)fire fighting permit
(13) sanitation permit
(14) civilian air defense permit
12.5 Information and official documents regarding any factors that may affect the intended purpose of the buildings or land, including:
(1)material damage to or deterioration of the building or land
(2)the surrounding natural and man-made environment, such as public utilities, roads and use of nearby buildings
13.Intellectual Property
Practitioner’s Notess
Assess whether the Company infringes any IP of other companies.
Assess whether the Company’s IP is protected and not infringed upon.
13.1 Information and documents relating to foreign and domestic IP owned, currently used or possibly used by the Company or its subsidiaries whether licensed or unlicensed, which for this purpose includes:
(1)trademarks
(2)trade names
(3)logos
(4)trade dresses
(5)internet domain names
(6)patents, inventions, know-how
(7)trade secrets, designs
(8)copyrights, software (including those on office computers), databases
(9)layout designs of integrated circuits
(10)new varieties of plants and other rights of a similar kind owned
13.2 For the IP above that is licensed to the Company or by the Company to another:
(1)licensing agreements
(2)registration certificates
(3)proof that the licensor is the owner of the IP or has the authority to sub-license
(4)receipts showing status of payment of royalties or other license fees
13.3 Patent and trademark applications (if such patent or trademark as not yet been registered) and associated receipts and documents
13.4 Internal policy on protection of secrets and know-how and whether such policy is adhered to
13.5 For technologies used by the Company that are not clearly in the public domain, non-infringement opinions issued by a patent agent, government or other parties
13.6 Information and documents relating to any potential, ongoing or recent claim of infringement or IP disputes involving the Company
14. Other Long-Term Assets
Practitioner’s Notess
Give information about other long-term assets of the Company.
14.1Basic information on long-term assets owned or leased by Company, such as manufacturing equipment, automobiles and office equipment, including whether there are any encumbrances
14.2 For each item worth more than the material amount, provide:
(1)the purchase order, receipts, customs declaration, etc.
(2)lease agreements (regardless of whether the Company is the lessor or the lessee) and receipts showing status of rent payment
15.Insurance
Practitioner’s Notess
Provide information on insurance policies held by the Company (effectiveness, coverage, etc.) and historical claims.
15.1 Information and documents relating to insurance policies held by the Company, including:
(1) contracts
(2) receipts or other proof that insurance premiums have been fully paid
15.2 Information and documents relating to all historical insurance claims over the material amount, including whether they that have been settled and paid
16. Product Liability
Practitioner’s Notess
Assess the potential liability of the Company to its customers for defective goods or services.
16.1 Official documents regarding the quality standard demanded of the Company’s goods and services
16.2 Terms of the warranties and liabilities typically provided by the Company for its goods and services
16.3 Documents regarding all potential, ongoing or recent product liability disputes
17. Antitrust
17.1 General information about the market(s) that the Company does business in:
(1)the type of goods and services that it offers
(2)whether there are any close substitutes for the Company’s products
(3)the geographical scope of its customers
(4)the market share of the Company (in percentage terms)
(5)the number of major competitors in the market and their respective market shares
17.2 Information and documents regarding any arrangement, whether via a formal or informal agreement or by any party’s knowing acquiescence to an implied arrangement:
(1)between the Company and its competitors
(2)between the Company and its buyers that in any way relates to a competitor’s goods or services (such as exclusive dealing)
(3)between the Company and its buyers setting conditions on resale
(4)between the Company and a buyer or supplier that in any way diminishes another buyer or seller’s ability to transact with the Company
17.3 Sales policy of the Company, such as:
(1)whether the firm ties any two or more independent products together to be sold only in a bundle
(2)pricing below its cost of making any product
(3)list of suggested resale prices
17.4 Information regarding any of the following business activity undertaken by the Company, including unilateral moves:
(1)with the objective of becoming or remaining a monopoly in the market
(2)with the objective of sending signals to or collaborating, directly or indirectly, with competitors
(3)with the objective or effect of diminishing its competitor’s ability to communicate or transact with suppliers or buyers
(4)with the objective or effect of forcing a buyer or supplier to choose between either transacting with it or with a competitor (but not both)
18. Other Non-Compliance
18.1 Additional information regarding any activities involving the company that might be irregular, fail to comply with any laws or regulations, or breach any contract
19. Other Relevant Issues
19.1 Any other document or information which, in your judgment, is significant with respect to the business of the Company and its subsidiaries or which should be considered and reviewed in making disclosures regarding the business and financial condition of the Company to prospective investors
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