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Strictly Private & Confidential




  Discussion Paper
Due Diligence Process




              M&A
   Strategic Advisory Division                       April 2009
Strictly Private & Confidential
Disclaimer




               The information and opinions in this document were
                prepared by Daiwa Securities Capital Markets Co. Ltd.
                (“Daiwa “) and/or its affiliates.

               The information herein and the sources of the information
                are believed by Daiwa to be reliable, but Daiwa makes
                no representation and/or warranty as to the accuracy or
                completeness of such information.

               Any use, disclosure, distribution, dissemination, copying,
                or reproduction of this document without prior written
                consent or approval from Daiwa is strictly prohibited.




        The information provided in this document is for your reference only and the accuracy and completeness of this information cannot be guaranteed or assured. The contents herein are therefore relied upon at
        your company’s own risk. This document has not been prepared for the purpose of investment solicitation, and Daiwa Securities Capital Markets Co. Ltd. (“Daiwa”) does not solicit any investment in securities
        from your company at the time of submitting this document. In determining a transaction, such as an investment in share certificates or other securities, your company should make such determination at your
        company’s own responsibility based upon a deliberation of relevant materials conducted by your company and the results of due diligence, etc.
        All rights in connection with the contents of this document shall belong to Daiwa, and no part of this document shall be disclosed to the public or transmitted to any third party without Daiwa SMBC’s consent;
        accordingly, please treat this document as strictly for your company’s own use.
Strictly Private & Confidential
Process Flow for the Transaction
    Implementation of                                   Detailed due diligence of the Target by the Investor
      Due Diligence                                            Business plan, Management resources
                                                               Assets (including receivables etc)
                                                               Liabilities (debt covenants, contingent liabilities)
                                                               Key documents
                                                               Brands, intangible assets
                                                               Environmental issues etc

    Submission of Final                                 Seller will prepare a Process Letter to the Investor
        Proposal                                        In response to the Process Letter, the Investor will submit a final proposal based on
                                                         the findings from the due diligence (including offer price etc)
                                                        Either the Seller or Investor will prepare the drafts of Share Purchase Agreement
                                                         and/or Joint Venture Agreement.
   Negotiation of Share                                 The counterparty will provide the markup of the Agreements.
 Purchase Agreement and                                 Based on the markups, both parties will enter into a negotiation (eg price, key
 Joint Venture Agreement                                 provisions such as conditions precedent, warranties, indemnification, closing
                                                         conditions, governing law etc)

                                                        Board approvals
 Signing of the Agreements                              Signing of Agreements



                                                        Prior to Closing, the Investor will verify that (1) the representations and warranties are
         Closing
                                                         true and accurate; (2) conditions precedent and pre-closing obligations are fulfilled;
                                                         (3) closing conditions are satisfied.
              The information provided in this document is for your reference only and the accuracy and completeness of this information cannot be guaranteed or assured. The contents herein are therefore relied upon at
              your company’s own risk. This document has not been prepared for the purpose of investment solicitation, and Daiwa Securities Capital Markets Co. Ltd. (“Daiwa”) does not solicit any investment in securities
              from your company at the time of submitting this document. In determining a transaction, such as an investment in share certificates or other securities, your company should make such determination at your
              company’s own responsibility based upon a deliberation of relevant materials conducted by your company and the results of due diligence, etc.
              All rights in connection with the contents of this document shall belong to Daiwa, and no part of this document shall be disclosed to the public or transmitted to any third party without Daiwa SMBC’s consent;
                                                                                                                                                                                                                                 2
              accordingly, please treat this document as strictly for your company’s own use.
Strictly Private & Confidential
Due Diligence

     The due diligence in M&A is a process whereby investors/buyers and their advisors conduct a comprehensive investigation
      and analysis of their target companies, in aspects such as business, financial, legal, operation, technology and
      environment.
                                             Due                               Business DD  Business DD                                                          Tax DD
                                             Diligence                         Financial DD  Environment DD                                                      HR DD etc



      Tasks of the Investor                                                        Flow M&A (in general)                                                                                 Tasks of the Seller
         Kick-off Meeting                                                        Formulation of M&A Strategy                                                                                   Kick-off Meeting


    Determination of DD Scope                                          Execution of confidentiality agreement                                                                Preparation of the Target Company
                                                                           Disclosure of preliminary info
     Analysis data-room info                                                                                                                                                     Preparation of Process Letter
    Q&A/ Additional info request                                                     Execution of LOI or MOU                                                                     (instructions to the Investor)
      Interview/ Investigation                                                                                                                                                          and data-room

                                                                               Implementation of DD
          Reports from                                                                                                                                                              Set-up of data-room
      Legal Advisors/Auditors                                                       Valuation and Negotiation                                                                     Preparation for interview
                                                                                                                                                                               Preparation of Agreement drafts

      Finalization of Proposal                                               Signing of Definitive Agreements
                                                                                                                                                                                          Replies to additional
                                                                                                                                                                                          queries and requests
                                                                                      Closing
                                                                         (Settlement and Transfer of shares)


                      The information provided in this document is for your reference only and the accuracy and completeness of this information cannot be guaranteed or assured. The contents herein are therefore relied upon at
                      your company’s own risk. This document has not been prepared for the purpose of investment solicitation, and Daiwa Securities Capital Markets Co. Ltd. (“Daiwa”) does not solicit any investment in securities
                      from your company at the time of submitting this document. In determining a transaction, such as an investment in share certificates or other securities, your company should make such determination at your
                      company’s own responsibility based upon a deliberation of relevant materials conducted by your company and the results of due diligence, etc.
                      All rights in connection with the contents of this document shall belong to Daiwa, and no part of this document shall be disclosed to the public or transmitted to any third party without Daiwa SMBC’s consent;
                                                                                                                                                                                                                                         3
                      accordingly, please treat this document as strictly for your company’s own use.
Strictly Private & Confidential
Due Diligence, Valuation and Negotiation of Agreements
         The DD process allows the Investor to assess the risks involved in the Transaction and understand the
          business of the Target for the valuation.
         Negotiation of the pricing and the definitive agreements will be based on the DD.


                                                                                                               DD, Valuation and Negotiation
       Flow M&A (in general)                                                                                     Business Plan                        Info from DD                                 The         Seller
                                                                                                                                                                                                   discloses      the
     Formulation of M&A Strategy                                                                                                                                                                   business plan and
                                                                                                                     Business DD                      Audit / Tax DD                             financial
                                                                                                                     Technology




                                                                                                  DD
                                                                                                                                                       Legal DD                                   statements of the
 Execution of confidentiality agreement                                                                               DD etc                           Environment                                Target.
     Disclosure of preliminary info                                                                                                                      DD etc
                                                                                                                                                                                                   The         Investor
                                                                                                                                                                                                   scrutinizes      the
       Execution of LOI or MOU                                                                                     Revised
                                                                                                                                                                                                   business plan and
                                                                                                                 Business Plan                   Normalized P/L, B/S                               normalizes       the
                                                                                                                                                                                                   financials.
    Implementation of DD
                                                                                                 Valuation
                                                                                                                   DCF                                                                            The Investor relies
                                                                                                                   Comparables                                                                    on the revised
       Valuation and Negotiation                                                                                   Net Tangible                                                                   business plan and
                                                                                                                    Assets                                                                         normalized
                                                                                                                                                        Issues    uncovered                       financials       to
    Signing of Definitive Agreements                                                                                                                      during the DD to                         conduct valuation
                                                                                                                                                          be reflected in the                      of Target.
                                                                                                                      Valuation                           definitive
               Closing                                                                                                                                                                             The        Investor
                                                                                                 Negotiation




                                                                                                                                                          agreements                               reflects the risks
  (Settlement and Transfer of shares)
                                                                                                                                                                                                   uncovered during
                                                                                                                                                                                                   the DD in the
                                                                                                                       Negotiation of the DA                                                       definitive
                                                                                                                                                                                                   agreements      for
                                                                                                                                                                                                   negotiation.
                 The information provided in this document is for your reference only and the accuracy and completeness of this information cannot be guaranteed or assured. The contents herein are therefore relied upon at
                 your company’s own risk. This document has not been prepared for the purpose of investment solicitation, and Daiwa Securities Capital Markets Co. Ltd. (“Daiwa”) does not solicit any investment in securities
                 from your company at the time of submitting this document. In determining a transaction, such as an investment in share certificates or other securities, your company should make such determination at your
                 company’s own responsibility based upon a deliberation of relevant materials conducted by your company and the results of due diligence, etc.
                 All rights in connection with the contents of this document shall belong to Daiwa, and no part of this document shall be disclosed to the public or transmitted to any third party without Daiwa SMBC’s consent;
                                                                                                                                                                                                                                    4
                 accordingly, please treat this document as strictly for your company’s own use.
Strictly Private & Confidential
Business Due Diligence

Business Due Diligence

         The Investor will investigate and analysis the Target, particularly in areas such as business model, market
          conditions, product characteristics and quality, customer base (distribution networks, bargaining power etc),
          competition, threats from substitutes and new entrants, production capabilities (technology, R&D strengths),
          past financials, future business plan etc. Based on these findings, the Investor will perform a SWOT
          analysis and assessment of the future profitability of the business.




         Objectives of Business Due Diligence
          (i) Examine the feasibility of the business plan and perform valuation of the Target based on this business
              plan
          (ii) Formulate a revised business plan of the merged entity, taking into consideration the synergies arising
               from the M&A. Perform valuation of the Target based on the revised business plan.
                         External climate: Industry analysis (Five Forces Analysis)
                         Analysis of the Target and its management strategy, business model, internal capabilities
                          (Analysis of value chain, SWOT etc)
                         Analysis of profitability (budgeted and actual, fixed and variable costs, working capital etc)
         Business Due Diligence is closely associated with Financial Due Diligence. Financial Due Diligence allows
          the Investor to verify the past business of the Target, while Business Due Diligence helps the Investor to
          authenticate the Target’s future business plan (based on the Financial Due Diligence).


                 The information provided in this document is for your reference only and the accuracy and completeness of this information cannot be guaranteed or assured. The contents herein are therefore relied upon at
                 your company’s own risk. This document has not been prepared for the purpose of investment solicitation, and Daiwa Securities Capital Markets Co. Ltd. (“Daiwa”) does not solicit any investment in securities
                 from your company at the time of submitting this document. In determining a transaction, such as an investment in share certificates or other securities, your company should make such determination at your
                 company’s own responsibility based upon a deliberation of relevant materials conducted by your company and the results of due diligence, etc.
                 All rights in connection with the contents of this document shall belong to Daiwa, and no part of this document shall be disclosed to the public or transmitted to any third party without Daiwa SMBC’s consent;
                                                                                                                                                                                                                                    5
                 accordingly, please treat this document as strictly for your company’s own use.
Strictly Private & Confidential
Legal Due Diligence

Legal Due Diligence

    The Investor will investigate aspects associated with the legal risks involved in the Transaction.
    Legal Due Diligence will involve the review of various documents and contracts. This will allow the Investor not only to
     ascertain the authenticity of the documents, but also assess the impact of long-term or unusual contracts on the
     business, or any contingent liabilities on the financials of the Target.
    Legal risks and their impact on the Transaction will be assessed. The Investor will normally propose schemes or add
     provisions in the acquisition agreement to minimize or eliminate such risks.
    Examples of legal firms with partners in Indonesia: Norton Rose, Baker & McKenzie, Milbank, Allen & Gledhill, Khattar
     Wong, Letham & Watkins



    Impact on approvals and material contracts
           It is important to ascertain the impact of the Transaction on approvals and material contracts. For example, a
            change of control will sometimes lead to cancellation of regulatory approvals and licenses and termination of
            contracts.

    Impact on valuation of the Target
           While Legal Due Diligence is not directly associated with the valuation of the Target, there are instances
            whereby adjustments are made to the valuation based on the Legal Due Diligence findings, e.g. the Target
            would be involved in a litigation and there is a strong likelihood that the Target would be liable for any damages.




                  The information provided in this document is for your reference only and the accuracy and completeness of this information cannot be guaranteed or assured. The contents herein are therefore relied upon at
                  your company’s own risk. This document has not been prepared for the purpose of investment solicitation, and Daiwa Securities Capital Markets Co. Ltd. (“Daiwa”) does not solicit any investment in securities
                  from your company at the time of submitting this document. In determining a transaction, such as an investment in share certificates or other securities, your company should make such determination at your
                  company’s own responsibility based upon a deliberation of relevant materials conducted by your company and the results of due diligence, etc.
                  All rights in connection with the contents of this document shall belong to Daiwa, and no part of this document shall be disclosed to the public or transmitted to any third party without Daiwa SMBC’s consent;
                                                                                                                                                                                                                                     6
                  accordingly, please treat this document as strictly for your company’s own use.
Strictly Private & Confidential
  Financial and Tax Due Diligence
Financial and Tax Due Diligence

       Verification of past financial performance and profitability of the Target
       Assessment of current financial and cash position, which will form the basis for the Target’s future projections.




       Analysis of Income Statement
              Understanding the revenue and cost model associated to the operating performance of the Target’s business
              Normalization of the earnings of the company

       Analysis of Cash Flows
              Analysis of EBITDA projections, working capital, monthly and annual cash flows, capital expenditure etc

       Analysis of Business Plan
              Assessment of the consistency and compatibility of the model (based on actual and projected performance)
              Validation of the assumptions used in the model

       Analysis of Balance Sheet
              Assessment of the potential risk involved in the Transaction




                      The information provided in this document is for your reference only and the accuracy and completeness of this information cannot be guaranteed or assured. The contents herein are therefore relied upon at
                      your company’s own risk. This document has not been prepared for the purpose of investment solicitation, and Daiwa Securities Capital Markets Co. Ltd. (“Daiwa”) does not solicit any investment in securities
                      from your company at the time of submitting this document. In determining a transaction, such as an investment in share certificates or other securities, your company should make such determination at your
                      company’s own responsibility based upon a deliberation of relevant materials conducted by your company and the results of due diligence, etc.
                      All rights in connection with the contents of this document shall belong to Daiwa, and no part of this document shall be disclosed to the public or transmitted to any third party without Daiwa SMBC’s consent;
                                                                                                                                                                                                                                         7
                      accordingly, please treat this document as strictly for your company’s own use.
Strictly Private & Confidential
 Key Points

1 Period for the DD                                                                                                4 Scope for the DD
      The period for the DD varies from companies to                                                                              The Investor would request for information in
       companies, but normally spans from 3 weeks to 2                                                                              connection to risks involved in the transaction (such
       months.                                                                                                                      as contingent liabilities etc). The Seller shall disclose
                                                                                                                                    sufficient and necessary information for the
2 Venue for the DD (Data-room)                                                                                                      transaction.
      Physical data-room or Virtual data-room (“VDR”).                                                                            Scope for the DD will have to be considered together
       Examples of VDR providers: Bowne; Intralinks.                                                                                with the period of the DD and budget constraints.
      For many cross-border transactions (and for those                                                           5 Coordination with the Investor on Data Request
       which potentially involve several bidders), virtual
       data-room is often used as it is more cost-effective                                                                        A system must be put in place to allow queries (such
       and efficient.                                                                                                               as those related to business, financial, accounting,
                                                                                                                                    legal, environment, human resource) by the Investor
3 Team Structure                                                                                                                    t o b e a n s we r e d in a co o r d i n a t e d m a n n e r.
      It is recommended that the Seller engages a financial
       advisor, legal advisor and if necessary auditors, tax
       consultants etc for the team.
      While international audit firms have their
       counterparts in Indonesia, we do not recommend to
       change auditors at this point as it will take time for
       newly appointed auditors to come up to speed




                    The information provided in this document is for your reference only and the accuracy and completeness of this information cannot be guaranteed or assured. The contents herein are therefore relied upon at
                    your company’s own risk. This document has not been prepared for the purpose of investment solicitation, and Daiwa Securities Capital Markets Co. Ltd. (“Daiwa”) does not solicit any investment in securities
                    from your company at the time of submitting this document. In determining a transaction, such as an investment in share certificates or other securities, your company should make such determination at your
                    company’s own responsibility based upon a deliberation of relevant materials conducted by your company and the results of due diligence, etc.
                    All rights in connection with the contents of this document shall belong to Daiwa, and no part of this document shall be disclosed to the public or transmitted to any third party without Daiwa SMBC’s consent;
                                                                                                                                                                                                                                       8
                    accordingly, please treat this document as strictly for your company’s own use.
Strictly Private & Confidential
Information Flow during Due Diligence
   The Financial Advisor should take up the role of the point of contact with the Investor in order to facilitate the flow of the information
    during the DD.
   A DD, if not properly executed, will result in bad faith between the parties and negatively impact the negotiation over pricing, terms
    and conditions.


                                                                Investor                                                                                                      Seller
    Timeline
                                                                             Investor                                                             Seller’s FA
                                                                             Queries/
               Information Inflow




                                     Preparation                           Data request                                                        Receives
                                                                                list                            Queries/                       Requests                     FA
                                                                                                                  Data
                                                                                                 FA             Request/                        Decides
                                       Investor                                                                 Interview                        where
                                                                                                                Request                        to channel
                                       Advisors
                                                                                                                                              the queries


                                                                                                                                                                                         Formulation
                                       Advisors
               Information Outflow




                                                                                                                                                                                         of responses
                                                                          Responses to                                                        Receives
                                     Formulation                             queries
                                      of reports                                                                                              Responses

                                                                                                                                                                                                                      Seller
                                                                          Responses to                                                         Receives
                                     Formulation                             queries                                                                                                                          Other Advisors
                                      of reports                                                                                              Responses



                                     The information provided in this document is for your reference only and the accuracy and completeness of this information cannot be guaranteed or assured. The contents herein are therefore relied upon at
                                     your company’s own risk. This document has not been prepared for the purpose of investment solicitation, and Daiwa Securities Capital Markets Co. Ltd. (“Daiwa”) does not solicit any investment in securities
                                     from your company at the time of submitting this document. In determining a transaction, such as an investment in share certificates or other securities, your company should make such determination at your
                                     company’s own responsibility based upon a deliberation of relevant materials conducted by your company and the results of due diligence, etc.
                                     All rights in connection with the contents of this document shall belong to Daiwa, and no part of this document shall be disclosed to the public or transmitted to any third party without Daiwa SMBC’s consent;
                                                                                                                                                                                                                                                        9
                                     accordingly, please treat this document as strictly for your company’s own use.
Strictly Private & Confidential
Virtual Data Room
   Virtual Data Room (“VDR”) is an online platform which hosts the documents required for the due diligence for a period of
    time. It is designed such that only the staff designated by the Investor and its advisors are granted access to these
    documents.
   Some of the VDR service providers include Intralinks and Bowne.
   Normally, the Investor will inform the Seller the names, designation and the email addresses of the staff accessing the
    VDR. Once the Seller has registered these accounts, the Investor and its advisors would be given access to the VDR
    with login usernames and passwords.




                                                                                                                                                                    Some Features of the VDR

                                                                                                                                          The Seller can monitor the access trails of the Investor
                                                                                                                                          and its advisors.

                                                                                                                                          For sensitive documents, print (and print-screen)
                                                                                                                                          restrictions may be set.

                                                                                                                                          Every time new materials are uploaded, the Investors
                                                                                                                                          and its advisors would be notified.

                                                                                                                                          The Seller can also keep track of documents printed out
                                                                                                                                          or downloaded.




                   The information provided in this document is for your reference only and the accuracy and completeness of this information cannot be guaranteed or assured. The contents herein are therefore relied upon at
                   your company’s own risk. This document has not been prepared for the purpose of investment solicitation, and Daiwa Securities Capital Markets Co. Ltd. (“Daiwa”) does not solicit any investment in securities
                   from your company at the time of submitting this document. In determining a transaction, such as an investment in share certificates or other securities, your company should make such determination at your
                   company’s own responsibility based upon a deliberation of relevant materials conducted by your company and the results of due diligence, etc.
                   All rights in connection with the contents of this document shall belong to Daiwa, and no part of this document shall be disclosed to the public or transmitted to any third party without Daiwa SMBC’s consent;
                                                                                                                                                                                                                                      10
                   accordingly, please treat this document as strictly for your company’s own use.
Strictly Private & Confidential
        Q&A/Information Requests
           The Investor would normally seek clarification or request for information in addition to that already disclosed in the VDR.
           The Q&A correspondence may be done using a spreadsheet prepared by the Seller.
           This spreadsheet will have columns for the Seller’s responses.


  Illustration of the Q&A spreadsheet

Project            Q&A List                    as of 2009/05/01                                                                                                                                                                      Confidential
                                                       Questions by
  No.   Category     New?   Date of Question                                        Priority     Reference                  Question               Date of ResponseResponded by         Response                 Check                     Remarks
                                                Company              Name

  1
  2

  3

  4

  5

  6

  7

  8

  9

  10

  11




                                                      Questions by the                                                                                                                        Responses by
                                                         Investor                                                                                                                               the Seller
  Note:

           In addition to the Q&A list above, the Seller may also provide the responses to the Investor over interviews or Q&A
            sessions etc.


                                      The information provided in this document is for your reference only and the accuracy and completeness of this information cannot be guaranteed or assured. The contents herein are therefore relied upon at
                                      your company’s own risk. This document has not been prepared for the purpose of investment solicitation, and Daiwa Securities Capital Markets Co. Ltd. (“Daiwa”) does not solicit any investment in securities
                                      from your company at the time of submitting this document. In determining a transaction, such as an investment in share certificates or other securities, your company should make such determination at your
                                      company’s own responsibility based upon a deliberation of relevant materials conducted by your company and the results of due diligence, etc.
                                      All rights in connection with the contents of this document shall belong to Daiwa, and no part of this document shall be disclosed to the public or transmitted to any third party without Daiwa SMBC’s consent;
                                                                                                                                                                                                                                                         11
                                      accordingly, please treat this document as strictly for your company’s own use.
Strictly Private & Confidential
Some Rules for Due Diligence

 Due Diligence Period
   Period for the Data Room
   Deadline for questions and information request by the Investor

 Q&A/Information Request
   Timing for submission of questions and information request (e.g. 17:00 every Tuesday and Friday during the due
     diligence period)
   Timing for submission of responses (e.g. 17:00 every Monday and Thursday during the due diligence period)
   The Investor must collate all questions (whether legal, financial or others) in the spreadsheet and send to the
     Seller for each submission
   The Investor must organize the questions such that there are no duplicated questions

 Q&A Sessions
   The Q&A sessions must be appropriately represented e.g. CEO for business sessions, legal counsel for legal and
     regulatory sessions, CFO for accounting sessions.
   Ground rules for decision of the Q&A sessions and the dates

 Site Visits
   Normally local staff are not notified of the Transaction. For confidentiality reasons, the site visits are positioned as
     audit sessions by clients etc.
   Conversations with local staff should be restricted, and no name cards should be exchanged.
   The attire for the site visits and the logistics etc.

                  The information provided in this document is for your reference only and the accuracy and completeness of this information cannot be guaranteed or assured. The contents herein are therefore relied upon at
                  your company’s own risk. This document has not been prepared for the purpose of investment solicitation, and Daiwa Securities Capital Markets Co. Ltd. (“Daiwa”) does not solicit any investment in securities
                  from your company at the time of submitting this document. In determining a transaction, such as an investment in share certificates or other securities, your company should make such determination at your
                  company’s own responsibility based upon a deliberation of relevant materials conducted by your company and the results of due diligence, etc.
                  All rights in connection with the contents of this document shall belong to Daiwa, and no part of this document shall be disclosed to the public or transmitted to any third party without Daiwa SMBC’s consent;
                                                                                                                                                                                                                                     12
                  accordingly, please treat this document as strictly for your company’s own use.
Data room rules

1.    A’s due diligence of B is subject to the Rules of the Data room below.
         ■ TBC
2.    Familiarity with Rules of the Data room - A is to ensure all its staff and advisors (“A parties”) are familiar with the
      rules below prior to commencement of the due diligence.
3.    Opening Hours:              Strictly 8am – 5pm from xx to xx xx 2011
4.    Venue:                      [                     ]
5.    Permitted Persons – A list of A parties that will be accessing the Data room, with company name, corporate title
      and contact telephone numbers, is to be provided by A to B through D two business days before
      commencement of the due diligence. Any change to the list of permitted persons must be informed by writing
      two business days beforehand. B reserves the right to decide if any change is allowed.
6.    Signoff on Data room files provided - A is required to sign off that they have received all the files as listed in the
      Data room index which will be provided at the start of the Due diligence.
7.    Signing in/Signing out - A parties are to sign in their particulars and time of entry on the Registry maintained by
      K staff and to sign out their time of exit daily.
8.    Designated Name tags of permitted persons are to be worn at all times while in the data room, and to be
      returned to K staff upon leaving the data room. Non-removal of Data room materials - A is to procure that no
      materials in the data room are to be removed by A parties at any time as these are strictly confidential and
      belong to the property of B.
9.    No copying or printing of any of the materials is allowed.
10.   Electronic access - Internet access and landline access would only be provided on an available basis.
11.   Decorum – A parties are to be suitably dressed in office attire and to maintain good behaviour as guests of B.
12.   Smoking – No smoking is allowed in the data room. A parties may smoke in the designated smoking area only.




                                                 This document has been prepared by Daiwa Securities SMBC Singapore Limited. (“Daiwa SMBC”) based on information, the sources of which are believed by Daiwa SMBC to            13
                                                 be reliable, but Daiwa SMBC makes no representation nor warranty as to the accuracy or completeness of such information. Recipients of this document must make their own
                                                 decisions on whether or not to adopt the recommendations discussed in this document, based upon their specific situations and objectives. Any use, disclosure, distribution,
                                                 dissemination, copying, or reproduction of this document without prior written consent from Daiwa SMBC is prohibited.
Data room rules (cont’d)
13.   Quiet – A parties are to be maintain quietness at all times. Where there is a need for verbal communication,
      this is to be kept at a minimum and at low volumes, to avoid disturbance to surrounding area and to avoid
       ■ disclosure of information and activities performed in the data room.
      any TBC
14.   Non-Communication to B staff - A parties are to abide by the sensitivity of the transaction and are not
      permitted to question, or talk to, or request information from K staff in the building or outside the data room at
      any time except to the persons appointed by K Management to communicate with A in the operation of the
      Due diligence.
15.   No chatting is permitted outside the data room among A parties.
16.   Non-Disclosure to outside parties - A parties are strictly not permitted to disclose any information from the
      data room to outsiders. All A parties accept and acknowledge that they are bound by the Non-disclosure
      agreement signed by A with B dated [               ].
17.   All queries/request for information by A to B are to be submitted on prescribed form which are available in the
      dataroom (Form 1). As B Management are busy running the day-to-day operations of the company, A is to
      vet through any requests/queries by B parties before submitting them to B. A is to determine among other
      factors, the relevance, materiality and usefulness of the information being requested and to avoid submitting
      duplicate or similar questions to B
18.   K is not obligated to answer any or all of the queries/request for information by A parties and will answer
      them as it deems fit.
19.   A’s requests on prescribed Form 1 are to be handed to B staff appointed to collect the forms at 12pm, and at
      the end of the day.
20.   All information provided by B to A parties remain the property of B, and are to be surrendered to B upon
      demand.
21.   A is to ensure A parties abide by all the Rules above. Non-compliance by A parties to any of the Rules above
      can seriously jeopardize B’s position. Consequently, B reserve the right to seek damages, redress and
      remedial actions including baring any or all A parties from further entry into the data room, cancelling the due
      diligence, cancelling the transaction, litigation and any legal or other recourse under its disposal.

                                              This document has been prepared by Daiwa Securities SMBC Singapore Limited. (“Daiwa SMBC”) based on information, the sources of which are believed by Daiwa SMBC to            14
                                              be reliable, but Daiwa SMBC makes no representation nor warranty as to the accuracy or completeness of such information. Recipients of this document must make their own
                                              decisions on whether or not to adopt the recommendations discussed in this document, based upon their specific situations and objectives. Any use, disclosure, distribution,
                                              dissemination, copying, or reproduction of this document without prior written consent from Daiwa SMBC is prohibited.

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Due diligence slides

  • 1. Strictly Private & Confidential Discussion Paper Due Diligence Process M&A Strategic Advisory Division April 2009
  • 2. Strictly Private & Confidential Disclaimer  The information and opinions in this document were prepared by Daiwa Securities Capital Markets Co. Ltd. (“Daiwa “) and/or its affiliates.  The information herein and the sources of the information are believed by Daiwa to be reliable, but Daiwa makes no representation and/or warranty as to the accuracy or completeness of such information.  Any use, disclosure, distribution, dissemination, copying, or reproduction of this document without prior written consent or approval from Daiwa is strictly prohibited. The information provided in this document is for your reference only and the accuracy and completeness of this information cannot be guaranteed or assured. The contents herein are therefore relied upon at your company’s own risk. This document has not been prepared for the purpose of investment solicitation, and Daiwa Securities Capital Markets Co. Ltd. (“Daiwa”) does not solicit any investment in securities from your company at the time of submitting this document. In determining a transaction, such as an investment in share certificates or other securities, your company should make such determination at your company’s own responsibility based upon a deliberation of relevant materials conducted by your company and the results of due diligence, etc. All rights in connection with the contents of this document shall belong to Daiwa, and no part of this document shall be disclosed to the public or transmitted to any third party without Daiwa SMBC’s consent; accordingly, please treat this document as strictly for your company’s own use.
  • 3. Strictly Private & Confidential Process Flow for the Transaction Implementation of  Detailed due diligence of the Target by the Investor Due Diligence  Business plan, Management resources  Assets (including receivables etc)  Liabilities (debt covenants, contingent liabilities)  Key documents  Brands, intangible assets  Environmental issues etc Submission of Final  Seller will prepare a Process Letter to the Investor Proposal  In response to the Process Letter, the Investor will submit a final proposal based on the findings from the due diligence (including offer price etc)  Either the Seller or Investor will prepare the drafts of Share Purchase Agreement and/or Joint Venture Agreement. Negotiation of Share  The counterparty will provide the markup of the Agreements. Purchase Agreement and  Based on the markups, both parties will enter into a negotiation (eg price, key Joint Venture Agreement provisions such as conditions precedent, warranties, indemnification, closing conditions, governing law etc)  Board approvals Signing of the Agreements  Signing of Agreements  Prior to Closing, the Investor will verify that (1) the representations and warranties are Closing true and accurate; (2) conditions precedent and pre-closing obligations are fulfilled; (3) closing conditions are satisfied. The information provided in this document is for your reference only and the accuracy and completeness of this information cannot be guaranteed or assured. The contents herein are therefore relied upon at your company’s own risk. This document has not been prepared for the purpose of investment solicitation, and Daiwa Securities Capital Markets Co. Ltd. (“Daiwa”) does not solicit any investment in securities from your company at the time of submitting this document. In determining a transaction, such as an investment in share certificates or other securities, your company should make such determination at your company’s own responsibility based upon a deliberation of relevant materials conducted by your company and the results of due diligence, etc. All rights in connection with the contents of this document shall belong to Daiwa, and no part of this document shall be disclosed to the public or transmitted to any third party without Daiwa SMBC’s consent; 2 accordingly, please treat this document as strictly for your company’s own use.
  • 4. Strictly Private & Confidential Due Diligence  The due diligence in M&A is a process whereby investors/buyers and their advisors conduct a comprehensive investigation and analysis of their target companies, in aspects such as business, financial, legal, operation, technology and environment. Due  Business DD  Business DD  Tax DD Diligence  Financial DD  Environment DD  HR DD etc Tasks of the Investor Flow M&A (in general) Tasks of the Seller Kick-off Meeting Formulation of M&A Strategy Kick-off Meeting Determination of DD Scope Execution of confidentiality agreement Preparation of the Target Company Disclosure of preliminary info Analysis data-room info Preparation of Process Letter Q&A/ Additional info request Execution of LOI or MOU (instructions to the Investor) Interview/ Investigation and data-room Implementation of DD Reports from Set-up of data-room Legal Advisors/Auditors Valuation and Negotiation Preparation for interview Preparation of Agreement drafts Finalization of Proposal Signing of Definitive Agreements Replies to additional queries and requests Closing (Settlement and Transfer of shares) The information provided in this document is for your reference only and the accuracy and completeness of this information cannot be guaranteed or assured. The contents herein are therefore relied upon at your company’s own risk. This document has not been prepared for the purpose of investment solicitation, and Daiwa Securities Capital Markets Co. Ltd. (“Daiwa”) does not solicit any investment in securities from your company at the time of submitting this document. In determining a transaction, such as an investment in share certificates or other securities, your company should make such determination at your company’s own responsibility based upon a deliberation of relevant materials conducted by your company and the results of due diligence, etc. All rights in connection with the contents of this document shall belong to Daiwa, and no part of this document shall be disclosed to the public or transmitted to any third party without Daiwa SMBC’s consent; 3 accordingly, please treat this document as strictly for your company’s own use.
  • 5. Strictly Private & Confidential Due Diligence, Valuation and Negotiation of Agreements  The DD process allows the Investor to assess the risks involved in the Transaction and understand the business of the Target for the valuation.  Negotiation of the pricing and the definitive agreements will be based on the DD. DD, Valuation and Negotiation Flow M&A (in general) Business Plan Info from DD The Seller discloses the Formulation of M&A Strategy business plan and  Business DD  Audit / Tax DD financial  Technology DD  Legal DD statements of the Execution of confidentiality agreement DD etc  Environment Target. Disclosure of preliminary info DD etc The Investor scrutinizes the Execution of LOI or MOU Revised business plan and Business Plan Normalized P/L, B/S normalizes the financials. Implementation of DD Valuation  DCF The Investor relies  Comparables on the revised Valuation and Negotiation  Net Tangible business plan and Assets normalized  Issues uncovered financials to Signing of Definitive Agreements during the DD to conduct valuation be reflected in the of Target. Valuation definitive Closing The Investor Negotiation agreements reflects the risks (Settlement and Transfer of shares) uncovered during the DD in the Negotiation of the DA definitive agreements for negotiation. The information provided in this document is for your reference only and the accuracy and completeness of this information cannot be guaranteed or assured. The contents herein are therefore relied upon at your company’s own risk. This document has not been prepared for the purpose of investment solicitation, and Daiwa Securities Capital Markets Co. Ltd. (“Daiwa”) does not solicit any investment in securities from your company at the time of submitting this document. In determining a transaction, such as an investment in share certificates or other securities, your company should make such determination at your company’s own responsibility based upon a deliberation of relevant materials conducted by your company and the results of due diligence, etc. All rights in connection with the contents of this document shall belong to Daiwa, and no part of this document shall be disclosed to the public or transmitted to any third party without Daiwa SMBC’s consent; 4 accordingly, please treat this document as strictly for your company’s own use.
  • 6. Strictly Private & Confidential Business Due Diligence Business Due Diligence  The Investor will investigate and analysis the Target, particularly in areas such as business model, market conditions, product characteristics and quality, customer base (distribution networks, bargaining power etc), competition, threats from substitutes and new entrants, production capabilities (technology, R&D strengths), past financials, future business plan etc. Based on these findings, the Investor will perform a SWOT analysis and assessment of the future profitability of the business.  Objectives of Business Due Diligence (i) Examine the feasibility of the business plan and perform valuation of the Target based on this business plan (ii) Formulate a revised business plan of the merged entity, taking into consideration the synergies arising from the M&A. Perform valuation of the Target based on the revised business plan.  External climate: Industry analysis (Five Forces Analysis)  Analysis of the Target and its management strategy, business model, internal capabilities (Analysis of value chain, SWOT etc)  Analysis of profitability (budgeted and actual, fixed and variable costs, working capital etc)  Business Due Diligence is closely associated with Financial Due Diligence. Financial Due Diligence allows the Investor to verify the past business of the Target, while Business Due Diligence helps the Investor to authenticate the Target’s future business plan (based on the Financial Due Diligence). The information provided in this document is for your reference only and the accuracy and completeness of this information cannot be guaranteed or assured. The contents herein are therefore relied upon at your company’s own risk. This document has not been prepared for the purpose of investment solicitation, and Daiwa Securities Capital Markets Co. Ltd. (“Daiwa”) does not solicit any investment in securities from your company at the time of submitting this document. In determining a transaction, such as an investment in share certificates or other securities, your company should make such determination at your company’s own responsibility based upon a deliberation of relevant materials conducted by your company and the results of due diligence, etc. All rights in connection with the contents of this document shall belong to Daiwa, and no part of this document shall be disclosed to the public or transmitted to any third party without Daiwa SMBC’s consent; 5 accordingly, please treat this document as strictly for your company’s own use.
  • 7. Strictly Private & Confidential Legal Due Diligence Legal Due Diligence  The Investor will investigate aspects associated with the legal risks involved in the Transaction.  Legal Due Diligence will involve the review of various documents and contracts. This will allow the Investor not only to ascertain the authenticity of the documents, but also assess the impact of long-term or unusual contracts on the business, or any contingent liabilities on the financials of the Target.  Legal risks and their impact on the Transaction will be assessed. The Investor will normally propose schemes or add provisions in the acquisition agreement to minimize or eliminate such risks.  Examples of legal firms with partners in Indonesia: Norton Rose, Baker & McKenzie, Milbank, Allen & Gledhill, Khattar Wong, Letham & Watkins  Impact on approvals and material contracts  It is important to ascertain the impact of the Transaction on approvals and material contracts. For example, a change of control will sometimes lead to cancellation of regulatory approvals and licenses and termination of contracts.  Impact on valuation of the Target  While Legal Due Diligence is not directly associated with the valuation of the Target, there are instances whereby adjustments are made to the valuation based on the Legal Due Diligence findings, e.g. the Target would be involved in a litigation and there is a strong likelihood that the Target would be liable for any damages. The information provided in this document is for your reference only and the accuracy and completeness of this information cannot be guaranteed or assured. The contents herein are therefore relied upon at your company’s own risk. This document has not been prepared for the purpose of investment solicitation, and Daiwa Securities Capital Markets Co. Ltd. (“Daiwa”) does not solicit any investment in securities from your company at the time of submitting this document. In determining a transaction, such as an investment in share certificates or other securities, your company should make such determination at your company’s own responsibility based upon a deliberation of relevant materials conducted by your company and the results of due diligence, etc. All rights in connection with the contents of this document shall belong to Daiwa, and no part of this document shall be disclosed to the public or transmitted to any third party without Daiwa SMBC’s consent; 6 accordingly, please treat this document as strictly for your company’s own use.
  • 8. Strictly Private & Confidential Financial and Tax Due Diligence Financial and Tax Due Diligence  Verification of past financial performance and profitability of the Target  Assessment of current financial and cash position, which will form the basis for the Target’s future projections.  Analysis of Income Statement  Understanding the revenue and cost model associated to the operating performance of the Target’s business  Normalization of the earnings of the company  Analysis of Cash Flows  Analysis of EBITDA projections, working capital, monthly and annual cash flows, capital expenditure etc  Analysis of Business Plan  Assessment of the consistency and compatibility of the model (based on actual and projected performance)  Validation of the assumptions used in the model  Analysis of Balance Sheet  Assessment of the potential risk involved in the Transaction The information provided in this document is for your reference only and the accuracy and completeness of this information cannot be guaranteed or assured. The contents herein are therefore relied upon at your company’s own risk. This document has not been prepared for the purpose of investment solicitation, and Daiwa Securities Capital Markets Co. Ltd. (“Daiwa”) does not solicit any investment in securities from your company at the time of submitting this document. In determining a transaction, such as an investment in share certificates or other securities, your company should make such determination at your company’s own responsibility based upon a deliberation of relevant materials conducted by your company and the results of due diligence, etc. All rights in connection with the contents of this document shall belong to Daiwa, and no part of this document shall be disclosed to the public or transmitted to any third party without Daiwa SMBC’s consent; 7 accordingly, please treat this document as strictly for your company’s own use.
  • 9. Strictly Private & Confidential Key Points 1 Period for the DD 4 Scope for the DD  The period for the DD varies from companies to  The Investor would request for information in companies, but normally spans from 3 weeks to 2 connection to risks involved in the transaction (such months. as contingent liabilities etc). The Seller shall disclose sufficient and necessary information for the 2 Venue for the DD (Data-room) transaction.  Physical data-room or Virtual data-room (“VDR”).  Scope for the DD will have to be considered together Examples of VDR providers: Bowne; Intralinks. with the period of the DD and budget constraints.  For many cross-border transactions (and for those 5 Coordination with the Investor on Data Request which potentially involve several bidders), virtual data-room is often used as it is more cost-effective  A system must be put in place to allow queries (such and efficient. as those related to business, financial, accounting, legal, environment, human resource) by the Investor 3 Team Structure t o b e a n s we r e d in a co o r d i n a t e d m a n n e r.  It is recommended that the Seller engages a financial advisor, legal advisor and if necessary auditors, tax consultants etc for the team.  While international audit firms have their counterparts in Indonesia, we do not recommend to change auditors at this point as it will take time for newly appointed auditors to come up to speed The information provided in this document is for your reference only and the accuracy and completeness of this information cannot be guaranteed or assured. The contents herein are therefore relied upon at your company’s own risk. This document has not been prepared for the purpose of investment solicitation, and Daiwa Securities Capital Markets Co. Ltd. (“Daiwa”) does not solicit any investment in securities from your company at the time of submitting this document. In determining a transaction, such as an investment in share certificates or other securities, your company should make such determination at your company’s own responsibility based upon a deliberation of relevant materials conducted by your company and the results of due diligence, etc. All rights in connection with the contents of this document shall belong to Daiwa, and no part of this document shall be disclosed to the public or transmitted to any third party without Daiwa SMBC’s consent; 8 accordingly, please treat this document as strictly for your company’s own use.
  • 10. Strictly Private & Confidential Information Flow during Due Diligence  The Financial Advisor should take up the role of the point of contact with the Investor in order to facilitate the flow of the information during the DD.  A DD, if not properly executed, will result in bad faith between the parties and negatively impact the negotiation over pricing, terms and conditions. Investor Seller Timeline Investor Seller’s FA Queries/ Information Inflow Preparation Data request Receives list Queries/ Requests FA Data FA Request/ Decides Investor Interview where Request to channel Advisors the queries Formulation Advisors Information Outflow of responses Responses to Receives Formulation queries of reports Responses Seller Responses to Receives Formulation queries Other Advisors of reports Responses The information provided in this document is for your reference only and the accuracy and completeness of this information cannot be guaranteed or assured. The contents herein are therefore relied upon at your company’s own risk. This document has not been prepared for the purpose of investment solicitation, and Daiwa Securities Capital Markets Co. Ltd. (“Daiwa”) does not solicit any investment in securities from your company at the time of submitting this document. In determining a transaction, such as an investment in share certificates or other securities, your company should make such determination at your company’s own responsibility based upon a deliberation of relevant materials conducted by your company and the results of due diligence, etc. All rights in connection with the contents of this document shall belong to Daiwa, and no part of this document shall be disclosed to the public or transmitted to any third party without Daiwa SMBC’s consent; 9 accordingly, please treat this document as strictly for your company’s own use.
  • 11. Strictly Private & Confidential Virtual Data Room  Virtual Data Room (“VDR”) is an online platform which hosts the documents required for the due diligence for a period of time. It is designed such that only the staff designated by the Investor and its advisors are granted access to these documents.  Some of the VDR service providers include Intralinks and Bowne.  Normally, the Investor will inform the Seller the names, designation and the email addresses of the staff accessing the VDR. Once the Seller has registered these accounts, the Investor and its advisors would be given access to the VDR with login usernames and passwords. Some Features of the VDR The Seller can monitor the access trails of the Investor and its advisors. For sensitive documents, print (and print-screen) restrictions may be set. Every time new materials are uploaded, the Investors and its advisors would be notified. The Seller can also keep track of documents printed out or downloaded. The information provided in this document is for your reference only and the accuracy and completeness of this information cannot be guaranteed or assured. The contents herein are therefore relied upon at your company’s own risk. This document has not been prepared for the purpose of investment solicitation, and Daiwa Securities Capital Markets Co. Ltd. (“Daiwa”) does not solicit any investment in securities from your company at the time of submitting this document. In determining a transaction, such as an investment in share certificates or other securities, your company should make such determination at your company’s own responsibility based upon a deliberation of relevant materials conducted by your company and the results of due diligence, etc. All rights in connection with the contents of this document shall belong to Daiwa, and no part of this document shall be disclosed to the public or transmitted to any third party without Daiwa SMBC’s consent; 10 accordingly, please treat this document as strictly for your company’s own use.
  • 12. Strictly Private & Confidential Q&A/Information Requests  The Investor would normally seek clarification or request for information in addition to that already disclosed in the VDR.  The Q&A correspondence may be done using a spreadsheet prepared by the Seller.  This spreadsheet will have columns for the Seller’s responses. Illustration of the Q&A spreadsheet Project Q&A List as of 2009/05/01 Confidential Questions by No. Category New? Date of Question Priority Reference Question Date of ResponseResponded by Response Check Remarks Company Name 1 2 3 4 5 6 7 8 9 10 11 Questions by the Responses by Investor the Seller Note:  In addition to the Q&A list above, the Seller may also provide the responses to the Investor over interviews or Q&A sessions etc. The information provided in this document is for your reference only and the accuracy and completeness of this information cannot be guaranteed or assured. The contents herein are therefore relied upon at your company’s own risk. This document has not been prepared for the purpose of investment solicitation, and Daiwa Securities Capital Markets Co. Ltd. (“Daiwa”) does not solicit any investment in securities from your company at the time of submitting this document. In determining a transaction, such as an investment in share certificates or other securities, your company should make such determination at your company’s own responsibility based upon a deliberation of relevant materials conducted by your company and the results of due diligence, etc. All rights in connection with the contents of this document shall belong to Daiwa, and no part of this document shall be disclosed to the public or transmitted to any third party without Daiwa SMBC’s consent; 11 accordingly, please treat this document as strictly for your company’s own use.
  • 13. Strictly Private & Confidential Some Rules for Due Diligence Due Diligence Period  Period for the Data Room  Deadline for questions and information request by the Investor Q&A/Information Request  Timing for submission of questions and information request (e.g. 17:00 every Tuesday and Friday during the due diligence period)  Timing for submission of responses (e.g. 17:00 every Monday and Thursday during the due diligence period)  The Investor must collate all questions (whether legal, financial or others) in the spreadsheet and send to the Seller for each submission  The Investor must organize the questions such that there are no duplicated questions Q&A Sessions  The Q&A sessions must be appropriately represented e.g. CEO for business sessions, legal counsel for legal and regulatory sessions, CFO for accounting sessions.  Ground rules for decision of the Q&A sessions and the dates Site Visits  Normally local staff are not notified of the Transaction. For confidentiality reasons, the site visits are positioned as audit sessions by clients etc.  Conversations with local staff should be restricted, and no name cards should be exchanged.  The attire for the site visits and the logistics etc. The information provided in this document is for your reference only and the accuracy and completeness of this information cannot be guaranteed or assured. The contents herein are therefore relied upon at your company’s own risk. This document has not been prepared for the purpose of investment solicitation, and Daiwa Securities Capital Markets Co. Ltd. (“Daiwa”) does not solicit any investment in securities from your company at the time of submitting this document. In determining a transaction, such as an investment in share certificates or other securities, your company should make such determination at your company’s own responsibility based upon a deliberation of relevant materials conducted by your company and the results of due diligence, etc. All rights in connection with the contents of this document shall belong to Daiwa, and no part of this document shall be disclosed to the public or transmitted to any third party without Daiwa SMBC’s consent; 12 accordingly, please treat this document as strictly for your company’s own use.
  • 14. Data room rules 1. A’s due diligence of B is subject to the Rules of the Data room below. ■ TBC 2. Familiarity with Rules of the Data room - A is to ensure all its staff and advisors (“A parties”) are familiar with the rules below prior to commencement of the due diligence. 3. Opening Hours: Strictly 8am – 5pm from xx to xx xx 2011 4. Venue: [ ] 5. Permitted Persons – A list of A parties that will be accessing the Data room, with company name, corporate title and contact telephone numbers, is to be provided by A to B through D two business days before commencement of the due diligence. Any change to the list of permitted persons must be informed by writing two business days beforehand. B reserves the right to decide if any change is allowed. 6. Signoff on Data room files provided - A is required to sign off that they have received all the files as listed in the Data room index which will be provided at the start of the Due diligence. 7. Signing in/Signing out - A parties are to sign in their particulars and time of entry on the Registry maintained by K staff and to sign out their time of exit daily. 8. Designated Name tags of permitted persons are to be worn at all times while in the data room, and to be returned to K staff upon leaving the data room. Non-removal of Data room materials - A is to procure that no materials in the data room are to be removed by A parties at any time as these are strictly confidential and belong to the property of B. 9. No copying or printing of any of the materials is allowed. 10. Electronic access - Internet access and landline access would only be provided on an available basis. 11. Decorum – A parties are to be suitably dressed in office attire and to maintain good behaviour as guests of B. 12. Smoking – No smoking is allowed in the data room. A parties may smoke in the designated smoking area only. This document has been prepared by Daiwa Securities SMBC Singapore Limited. (“Daiwa SMBC”) based on information, the sources of which are believed by Daiwa SMBC to 13 be reliable, but Daiwa SMBC makes no representation nor warranty as to the accuracy or completeness of such information. Recipients of this document must make their own decisions on whether or not to adopt the recommendations discussed in this document, based upon their specific situations and objectives. Any use, disclosure, distribution, dissemination, copying, or reproduction of this document without prior written consent from Daiwa SMBC is prohibited.
  • 15. Data room rules (cont’d) 13. Quiet – A parties are to be maintain quietness at all times. Where there is a need for verbal communication, this is to be kept at a minimum and at low volumes, to avoid disturbance to surrounding area and to avoid ■ disclosure of information and activities performed in the data room. any TBC 14. Non-Communication to B staff - A parties are to abide by the sensitivity of the transaction and are not permitted to question, or talk to, or request information from K staff in the building or outside the data room at any time except to the persons appointed by K Management to communicate with A in the operation of the Due diligence. 15. No chatting is permitted outside the data room among A parties. 16. Non-Disclosure to outside parties - A parties are strictly not permitted to disclose any information from the data room to outsiders. All A parties accept and acknowledge that they are bound by the Non-disclosure agreement signed by A with B dated [ ]. 17. All queries/request for information by A to B are to be submitted on prescribed form which are available in the dataroom (Form 1). As B Management are busy running the day-to-day operations of the company, A is to vet through any requests/queries by B parties before submitting them to B. A is to determine among other factors, the relevance, materiality and usefulness of the information being requested and to avoid submitting duplicate or similar questions to B 18. K is not obligated to answer any or all of the queries/request for information by A parties and will answer them as it deems fit. 19. A’s requests on prescribed Form 1 are to be handed to B staff appointed to collect the forms at 12pm, and at the end of the day. 20. All information provided by B to A parties remain the property of B, and are to be surrendered to B upon demand. 21. A is to ensure A parties abide by all the Rules above. Non-compliance by A parties to any of the Rules above can seriously jeopardize B’s position. Consequently, B reserve the right to seek damages, redress and remedial actions including baring any or all A parties from further entry into the data room, cancelling the due diligence, cancelling the transaction, litigation and any legal or other recourse under its disposal. This document has been prepared by Daiwa Securities SMBC Singapore Limited. (“Daiwa SMBC”) based on information, the sources of which are believed by Daiwa SMBC to 14 be reliable, but Daiwa SMBC makes no representation nor warranty as to the accuracy or completeness of such information. Recipients of this document must make their own decisions on whether or not to adopt the recommendations discussed in this document, based upon their specific situations and objectives. Any use, disclosure, distribution, dissemination, copying, or reproduction of this document without prior written consent from Daiwa SMBC is prohibited.