普华永道——Chrysanthemum EL181102

1、singapore technologies kinetics ltd18 november 2002page 10 of 10private & confidentialsingapore technologies kinetics ltd (“stk”)249 jalan boon laysingapore 619523 attn:mr laurence ong18 november 2002dear sirs,proposed joint venture with beijing heavy duty truck plant (“bhdtp”)thank you for appointi

2、ng pricewaterhousecoopers to assist you with your market research and financial projection review in connection with your proposed joint venture with beijing heavy duty truck plant (“the target”) (the “transaction”). this engagement letter sets out the services that we have agreed to provide and the

3、 terms of our engagement.1.the services to be provided1.1 market research 1.1.1 we will prepare a market research report (the “report”) on the market conditions of the products to be manufactured and sold by the target. the areas our work will cover and the main procedures we will carry out are set

4、out in attachment a to this letter. 1.1.2 we will not provide a copy of our report to the management of the target or ask them to comment on a draft of our report. 1.2 financial forecast review1.2.1 with the benefit of the knowledge derived from the market research, we will perform a review of the f

5、inancial forecast prepared by stk. the areas our work will cover are set out in attachment a to this letter.2. timetable2.1we will be able to commence our work on 25 november 2002 and we expect our report to be completed by within 15 to 20 working days.3. the team3.1we currently envisage that our te

6、am will be led by xie tao, who will be the engagement partner responsible for the services we are to provide to you.4. fees4.1our fees are based upon the degree of responsibility and skill involved and the time necessarily occupied on the assignment. we estimate that our fees for this engagement wil

7、l be usd 45,000, or equivalent rmb translated at payment date. out-of-pocket expenses will include mainly transportation, accommodation, telecommunications, postage, copying and printing expenses which will be charged on an actual basis. our fees do not include business tax which will also be charge

8、d to you on total billings (including business tax) at a rate of 5.263%, together with the expenses referred to above. 4.2 fee and expenses will be invoiced as follows, and will be payable on receipt of invoice.estimated feesus$000on acceptance of these toe4.5on issue of the draft report27on issue o

9、f final report13.55. terms of business5.1this letter should be read in conjunction with the enclosed terms of business. the enclosed terms of business have been superseded by the following:clause 2.2- shall be deleted and replaced as follows:-you agree to treat, for the duration of this contract and

10、 for a further period of 3 years thereafter, all written information which is clearly marked confidential provided to you in connection with the services (reports) as confidential and except to the extent permitted by clause 2.3, you will not make the benefit of the services available to any third p

11、arty.clause 2.3. shall be amended as follows:-copies of our reports may be made available to directors and investment committee of singapore technologies engineering ltd (the parent company of singapore technologies kinetics ltd), your directors and officers, legal advisors and those employees invol

12、ved in the management of the transaction, provided that in each case you take reasonable steps to ensure that they understand:-(i)our reports are confidential;(ii)they may use our reports only for the purposes of the transaction; (iii)we accept no duty of care to them in respect of any use they may

13、make of our reports.we shall be allowed to include an appropriate legend in our reports to inform all third parties of the above understanding as set out in 2.3(iii).clause 3.1.1 shall be deleted and replaced as follows:-we shall be governed by the confidential agreement executed on the 11th october

14、 2002.clause 3.1.2 shall be deleted and replaced as follows:-we may disclose confidential information to our insurers, legal advisers and if required so by law or professional regulation.clause 3.1.3 shall be deleted and replaced as follows:-subject to 3.1.1 above, and once the transaction is no lon

15、ger confidential, we may cite the performance of the services to our clients and prospective clients as an indication of our experience subject to us obtaining your prior written consent.clause 3.2.1 shall be amended as follows:-(i) we may be in a position where we are providing services to other cl

16、ients who may be in competition with you or whose interest may conflict with your own. we will not be prevented or restricted by virtue of our relationship with you under this contract, from providing services to other clients, but(a)we will not use confidential information for the advantage of such

17、 clients and we will promptly inform you in writing of the possibility of such an engagement where it is to be carried out by pwcs beijing office transaction services department prior to the completion of the services hereunder; and(b)pwcs beijing office transaction services department will not repr

18、esent the target, any shareholder of the target, asia paradigm holdings inc., or any company which is interested in the target in any matter whatsoever whilst we are engaged by you under this contract.”clause 7.2 shall be deleted and replaced as follows:-any legal proceedings (whether in contract, t

19、ort or otherwise) arising out of or in connection with the services must be commenced within 6 years after the date on which the due diligence report was signed.clause 8.2.2 shall be deleted and replaced as follows:-notwithstanding the prohibition on the further distribution of the report covered by

20、 this engagement letter to third parties by singapore technologies kinetics ltd, singapore technologies kinetics ltd agrees to indemnify us, other pricewaterhousecoopers firms and our respective personnel and hold each of us harmless against any liabilities, losses, expenses and other costs we may r

21、easonably incur in connection with any third party claim (whether in contract, tort (including negligence) or otherwise) arising out of or in connection with the services that results from distribution of our reports to a third party that has not executed a release letter in a form acceptable to us

22、(see attachment c). this indemnity will not apply to the extent that the third party claim is finally determined to have resulted from the fraud or dishonesty of the firm or person indemnified.clause 9.4 shall be amended by inserting the following at the end of the clause:-.save for the confidential

23、ity agreement entered between the parties on 11th october 2002.clause 11.5 shall be deleted and replaced as follows:- confidential information: has the same meaning as defined in the confidential agreement dated 11th october 2002.6. acknowledgement and acceptance6.1this engagement letter (including

24、its attachment), the enclosed terms of business and the amended clauses in section 5.1 together form the contract between us.6.2please record your agreement to the terms of this contract by signing the enclosed copy of this letter in the space provided and returning it to us.yours faithfullypricewat

25、erhousecoopersconfirmation of the contracti have read the contract terms set out in the engagement letter dated 18 november 2002 (including its attachments) and the terms of business provided with that letter. i accept those contract terms on behalf of singapore technologies kinetics ltd and represe

26、nt that i am authorised by singapore technologies kinetics ltd to do so.signed: name and position: .on behalf of singapore technologies kinetics ltddate: .attachment apart 1 matters to be covered our work will cover the matters set out below, but our report will not necessarily include comments on a

27、ll of those matters because, in the interests of clearer reporting, we will not report on matters that we do not believe to be significant.imarket researchi.1objectivesto assist stk in assessing more clearly the chinese market conditions for the targets (jv with bhtdp) products by providing an updat

28、e analysis; and to provide supporting market data to assist in the review of the financial forecast.i.2key products bulk cement tanker concrete mixer articulated truck dump trucki.3key issues market potentials for the target- sales volume & prices forecast by key product- specific focus market size

29、by region (beijing and shanghai) by key product- total focus market size by key product- key market drivers and trends by key product regulatory environments- the actual impacts of the forthcoming laws (especially the laws banning on-site concrete mixing and packing of cement in conventional paper b

30、ag)- the impact of current tax system (local protection)- the impact of local unwritten rules (especially beijing) products evaluation- product plans of key competitors by key product- pricing strategies of key competitors by key product- products from new comers by key product customer assessment-

31、product preference (imported / jvs / local, quality / costs, etc.)- technology preference- services evaluation- brands assessment- satisfaction & dissatisfaction- trends of demand structure in the near future others- costs trends of top 5 raw materials- assessment on the impacts of distribution netw

32、orks - competition arena in the targeted cities- macro environments factors and trends i.4study approachthe research methodologies to be applied by us will involve desktop and primary research in the selective target regions (mainly in beijing and shanghai). the related data will be crosschecked and

33、 verified from many sources.main secondary research tools will include: 3rd parties sources: 2 to 3 out sources will be retained media sources: 4 to 6 main related medias internet research: 5 to 6 key competitors web, industrial associations web, and related government web, etc. others: 1 to 2 relat

34、ed research reports from security companies & funds, etc.key primary research methods include: 8 to10 interviews with key competitors 4 to 5 interviews with industrial experts 15 to 20 interviews with key customers 4 to 6 interviews with government agencies 6 to 8 interviews with key dealers 4 to 5

35、interviews with importersthe identity of these interview subjects could be communicated to you and agreed with you prior to interview.regional & target cities research: our primary research will mainly cover the cities of beijing and shanghai, and reach out to other areas as necessary with the objective of achieving at coast a 25% coverag