ADVISORY AGREEMENT
THIS ADVISORY AGREEMENT (this “Agreement”) is made and entered into as of [DATE] by and between [COMPANY NAME] (“Company”), a company organized and existing under the laws of [JURISDICTION], with its principal place of business at [ADDRESS], and [ADVISOR NAME] (“Advisor”), with its principal place of business at [ADDRESS].
WHEREAS, Company is considering a sale of all or substantially all of its assets or equity (the “Transaction”); and
WHEREAS, Advisor is a [DESCRIBE ADVISOR’S BUSINESS, E.G., investment bank, M&A advisory firm] with experience in advising companies on M&A transactions; and
WHEREAS, Company desires to engage Advisor to provide certain advisory services in connection with the Transaction (the “Services”), and Advisor is willing to provide such Services upon the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, the parties agree as follows:
1. Services.
Advisor agrees to provide the following services to Company in connection with the Transaction:
[LIST SPECIFIC SERVICES, E.G., preparation of information memorandum, identification and contacting of potential buyers, negotiation of transaction terms, due diligence coordination]
2. Fees.
2.1 Fee Amount.
Company agrees to pay Advisor a fee for the Services (the “Fee”) as follows:
[SPECIFY FEE STRUCTURE, E.G., success fee based on transaction value, hourly rate, retainer fee]
Retainer Fee: Upon the effective date of this Agreement, Company shall pay Advisor a non-refundable retainer fee of [Amount] (the "Retainer Fee").
Application of Retainer Fee: The Retainer Fee shall be applied towards the total Fee payable to Advisor under this Agreement.
Success Fee (Optional): In addition to the Retainer Fee, Advisor shall be entitled to a success fee (the "Success Fee") upon the successful closing of the Transaction. The Success Fee shall be calculated as a percentage of the total consideration received by the Company in connection with the Transaction (the "Transaction Consideration").
Success Fee Percentage: The Success Fee percentage shall be as follows:
[Percentage] of the Transaction Consideration for transactions valued at [Amount] or less.
[Percentage] of the Transaction Consideration for transactions valued between [Amount] and [Amount].
[Percentage] of the Transaction Consideration for transactions valued in excess of [Amount].
Transaction Consideration: For purposes of this Agreement, "Transaction Consideration" shall mean the aggregate amount of cash, securities, and other valuable consideration received by the Company and its shareholders in connection with the Transaction, as determined in good faith by Advisor.
Hourly Rate: Advisor shall be entitled to an hourly rate for all time reasonably and necessarily expended by Advisor’s personnel in the performance of the Services.
Hourly Rates: The applicable hourly rates for Advisor’s personnel shall be as follows:
[Partner/Managing Director]: [Amount] per hour
[Vice President/Director]: [Amount] per hour
[Associate]: [Amount] per hour
[Analyst/Associate Analyst]: [Amount] per hour
Billing Statements: Advisor shall submit detailed billing statements to Company on a [weekly/monthly] basis, which shall include a description of the services performed, the time spent by each individual, and the applicable hourly rate.
2.2 Fee Payment.
The Fee shall be payable as follows:
[SPECIFY PAYMENT TERMS, E.G., upon closing of the Transaction, with a portion payable upon signing of this Agreement]
3. Expenses.
Company shall be responsible for all reasonable and documented out-of-pocket expenses incurred by Advisor in connection with the Services (the “Expenses”).
4. Representations and Warranties.
4.1 Company Representations.
Company represents and warrants to Advisor that:
It has the full right, power, and authority to enter into and perform this Agreement;
This Agreement constitutes a valid and binding obligation of Company enforceable against it in accordance with its terms;
It has not previously entered into any agreement with any other party for services substantially similar to the Services; and
It will provide Advisor with all information and assistance reasonably necessary for Advisor to perform the Services.
4.2 Advisor Representations.
Advisor represents and warrants to Company that:
It has the full right, power, and authority to enter into and perform this Agreement;
This Agreement constitutes a valid and binding obligation of Advisor enforceable against it in accordance with its terms; and
It will use its best efforts to perform the Services in a professional and diligent manner.
5. Confidentiality.
5.1 Confidential Information.
For purposes of this Agreement, “Confidential Information” means any and all information disclosed by one party to the other party, whether orally or in writing, that is designated as confidential or that, under the circumstances surrounding its disclosure, ought reasonably to be regarded as confidential. Confidential Information shall include, but not be limited to, financial information, business plans, customer lists, and marketing strategies.
5.2 Obligations.
Each party agrees to hold the other party’s Confidential Information in strict confidence and not to disclose it to any third party without the prior written consent of the disclosing party, except as may be required by law or by order of a court of competent jurisdiction.
6. Termination.
This Agreement may be terminated by either party upon [NUMBER] days’ prior written notice to the other party for any of the following reasons:
Material breach by the other party of any of its material obligations under this Agreement; or
The other party becomes insolvent or bankrupt.
7. Indemnification.
Advisor agrees to indemnify and hold harmless Company from and against any and all losses, damages, liabilities, costs, and expenses (including reasonable attorneys’ fees) arising out of or resulting from any claim, action, or proceeding brought by any third party against Company based on Advisor’s negligence or willful misconduct in the performance of the Services.
8. Governing Law.
This Agreement shall be governed by and construed in accordance with the laws of the Republic of Singapore.
9. Entire Agreement.
This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior or contemporaneous communications, representations, or agreements, whether oral or written.
10. Severability.
If any provision of this Agreement is held to be invalid or unenforceable, such provision shall be struck and the remaining provisions shall remain in full force and effect.
11. Notices.
All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given when delivered personally, sent by certified or registered mail, return receipt requested, postage prepaid, or upon the first business day following transmission by facsimile or electronic mail, to the following addresses:
If to Company:
[COMPANY NAME]
[ADDRESS]
[ATTENTION]
If to Advisor:
[ADVISOR NAME]
[ADDRESS]
[ATTENTION]
or to such other address as either party may designate in writing from time to time.
12. Counterparts.
This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but all such counterparts shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.
[COMPANY NAME]
By: [NAME]
Title: [TITLE]
[ADVISOR NAME]
By: [NAME]
Title: [TITLE]
Key Enhancements to the M&A Sell-Side Advisory Agreement (Singapore)
The provided sample agreement serves as a basic framework. Here's a breakdown of key enhancements to consider for a more comprehensive and robust agreement:
1. Detailed Service Scope:
Specificity: Clearly define each service, including:
Information Memorandum Preparation: Level of detail, market research, competitive analysis, financial projections.
Buyer Identification & Contact: Target industries, specific companies, networking efforts.
Negotiation Support: Drafting term sheets, legal and financial due diligence coordination, valuation analysis, and assistance in closing negotiations.
Confidentiality Agreements (CAs): Drafting and management of CAs with potential buyers.
Marketing Materials: Preparation of presentations, teasers, and other marketing collateral.
Exclusivity (Optional): If desired, include clauses granting the advisor exclusive rights to market the company for a specified period.
2. Fee Structure & Payment Terms:
Tiered Fees: Consider a tiered fee structure based on transaction value to incentivize higher deal outcomes.
Success Fees: Structure success fees to align advisor incentives with the company's goals.
Payment Schedule: Include milestones for partial payments upon achieving specific deliverables.
Expense Reimbursement: Clearly define reimbursable expenses and establish a process for expense tracking and approval.
3. Representations & Warranties:
Company Warranties: Expand on warranties to include:
Accuracy of financial statements and other information provided.
Authority to enter into binding agreements.
No undisclosed material liabilities or legal proceedings.
Compliance with all applicable laws and regulations.
Advisor Warranties: Include warranties regarding:
Professional licenses and qualifications.
Adequate insurance coverage (e.g., professional liability).
Compliance with relevant industry regulations.
4. Confidentiality:
Definition of Confidential Information: Broaden the definition to include non-public information, trade secrets, and know-how.
Exceptions to Confidentiality: Clearly define permitted disclosures (e.g., legal advice, regulatory filings).
Return or Destruction of Confidential Information: Include provisions for the return or destruction of confidential materials upon termination of the agreement.
5. Termination & Dispute Resolution:
Termination Events: Include additional grounds for termination, such as:
Change of control of the company.
Material adverse change in the company's business.
Failure to obtain necessary regulatory approvals.
Dispute Resolution: Consider incorporating a dispute resolution mechanism, such as mediation or arbitration, to resolve disagreements efficiently.
6. Indemnification:
Mutual Indemnification: Include provisions for mutual indemnification for breaches of representations and warranties.
Limitations of Liability: Consider reasonable limitations of liability for both parties, such as caps on liability for indirect or consequential damages.
7. Governing Law & Jurisdiction:
Choice of Law: Explicitly state the governing law (e.g., Singapore law).
Jurisdiction: Specify the jurisdiction for the resolution of disputes.
8. Insurance:
Advisor's Insurance: Require the advisor to maintain adequate professional liability insurance.
9. Entire Agreement & Severability:
Entire Agreement: Reiterate that the agreement constitutes the entire understanding between the parties.
Severability: Include a severability clause to ensure the enforceability of the remaining provisions if any part of the agreement is deemed invalid.
By incorporating these enhancements, you can create a more comprehensive and robust M&A sell-side advisory agreement that protects the interests of both the company and the advisor.
Comprehensive M&A Sell-Side Advisory Agreement (Singapore)
[DATE]
THIS ADVISORY AGREEMENT (this “Agreement”) is made and entered into as of [DATE] by and between [COMPANY NAME] (“Company”), a company organized and existing under the laws of [JURISDICTION], with its principal place of business at [ADDRESS], and [ADVISOR NAME] (“Advisor”), with its principal place of business at [ADDRESS].
WHEREAS, Company is considering a sale of all or substantially all of its assets or equity (the “Transaction”); and
WHEREAS, Advisor is a [DESCRIBE ADVISOR’S BUSINESS, E.G., investment bank, M&A advisory firm] with experience in advising companies on M&A transactions; and
WHEREAS, Company desires to engage Advisor to provide certain advisory services in connection with the Transaction (the “Services”), and Advisor is willing to provide such Services upon the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, the parties agree as follows:
1. Services.
Advisor agrees to provide the following services to Company in connection with the Transaction:
Preparation of Information Memorandum:
Develop a comprehensive Information Memorandum (“IM”) including:
Company overview, industry analysis, financial performance, management team, key assets, competitive advantages, growth strategy, and risk factors.
Conduct market research and competitive analysis to support the IM.
Assist in preparing financial projections and valuations.
Buyer Identification & Contact:
Identify and target potential buyers, including strategic and financial buyers.
Leverage Advisor’s network and industry relationships to reach potential acquirers.
Conduct preliminary outreach to potential buyers and gauge their interest.
Negotiation Support:
Assist in drafting and reviewing transaction documents, including term sheets, NDAs, and definitive agreements.
Advise on and negotiate key deal terms, such as price, structure, and closing conditions.
Coordinate and manage the due diligence process, including responding to buyer requests and addressing due diligence issues.
Confidentiality Agreements (CAs):
Draft and manage CAs with potential buyers to protect confidential information.
Ensure compliance with confidentiality obligations throughout the transaction process.
Marketing Materials:
Prepare marketing materials, such as presentations and teasers, to showcase the Company to potential buyers.
Coordinate marketing efforts with Company management.
2. Fees.
2.1 Fee Amount.
Company agrees to pay Advisor a fee for the Services (the “Fee”) as follows:
[SPECIFY FEE STRUCTURE, E.G., success fee based on transaction value, hourly rate, retainer fee]
2.2 Fee Payment.
The Fee shall be payable as follows:
[SPECIFY PAYMENT TERMS, E.G., upon closing of the Transaction, with a portion payable upon signing of this Agreement]
3. Expenses.
Company shall be responsible for all reasonable and documented out-of-pocket expenses incurred by Advisor in connection with the Services (the “Expenses”).
4. Representations and Warranties.
4.1 Company Representations.
Company represents and warrants to Advisor that:
It has the full right, power, and authority to enter into and perform this Agreement.
This Agreement constitutes a valid and binding obligation of Company enforceable against it in accordance with its terms.
It has not previously entered into any agreement with any other party for services substantially similar to the Services.
It will provide Advisor with all information and assistance reasonably necessary for Advisor to perform the Services.
The financial statements and other information provided to Advisor are true, accurate, and complete in all material respects.
It is in compliance with all applicable laws and regulations.
There are no undisclosed material liabilities or legal proceedings.
It has the authority to enter into binding agreements with potential buyers.
4.2 Advisor Representations.
Advisor represents and warrants to Company that:
It has the full right, power, and authority to enter into and perform this Agreement.
This Agreement constitutes a valid and binding obligation of Advisor enforceable against it in accordance with its terms.
It will use its best efforts to perform the Services in a professional and diligent manner.
It has the necessary licenses and qualifications to provide M&A advisory services.
It maintains adequate professional liability insurance.
5. Confidentiality.
5.1 Confidential Information.
For purposes of this Agreement, “Confidential Information” means any and all information disclosed by one party to the other party, whether orally or in writing, that is designated as confidential or that, under the circumstances surrounding its disclosure, ought reasonably to be regarded as confidential. Confidential Information shall include, but not be limited to:
Financial information, including financial statements, projections, and budgets.
Business plans, strategies, and forecasts.
Customer lists, pricing information, and marketing materials.
Proprietary technologies, trade secrets, and know-how.
Any other information that is not generally known to the public.
5.2 Obligations.
Each party agrees to hold the other party’s Confidential Information in strict confidence and not to disclose it to any third party without the prior written consent of the disclosing party, except as may be required by law or by order of a court of competent jurisdiction.
5.3 Return or Destruction.
Upon termination of this Agreement, the receiving party shall return all Confidential Information to the disclosing party or, at the disclosing party’s option, destroy all copies of such Confidential Information in its possession or control.
6. Termination.
This Agreement may be terminated by either party upon [NUMBER] days’ prior written notice to the other party for any of the following reasons:
Material breach by the other party of any of its material obligations under this Agreement.
The other party becomes insolvent or bankrupt.
The Company is acquired by a third party.
The parties mutually agree in writing to terminate this Agreement.
7. Indemnification.
7.1 Advisor Indemnification.
Advisor agrees to indemnify and hold harmless Company from and against any and all losses, damages, liabilities, costs, and expenses (including reasonable attorneys’ fees) arising out of or resulting from any claim, action, or proceeding brought by any third party against Company based on Advisor’s negligence or willful misconduct in the performance of the Services.
7.2 Company Indemnification.
Company agrees to indemnify and hold harmless Advisor from and against any and all losses, damages, liabilities, costs, and expenses (including reasonable attorneys’ fees) arising out of or resulting from any claim, action, or proceeding brought by any third party against Advisor based on any misrepresentation or breach of warranty by Company.
8. Limitations of Liability.
Neither party shall be liable to the other party for any indirect, incidental, special, consequential, or punitive damages, including lost profits, lost revenue, or loss of business opportunity, arising out of or relating to this Agreement, regardless of whether such damages were foreseeable.
9. Governing Law & Jurisdiction.
This Agreement shall be governed by and construed in accordance with the laws of the Republic of Singapore. The parties agree to submit to the exclusive jurisdiction of the courts of Singapore for any dispute arising out of or relating to this Agreement.
10. Entire Agreement.
This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior or contemporaneous communications, representations, or agreements, whether oral or written.
11. Severability.
If any provision of this Agreement is held to be invalid or unenforceable, such provision shall be struck and the remaining provisions shall remain in full force and effect.
12. Notices.
All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given when delivered personally, sent by certified or registered mail, return receipt requested, postage prepaid, or upon the first business day following transmission by facsimile or electronic mail, to the following addresses:
If to Company:
[COMPANY NAME]
[ADDRESS]
[ATTENTION]
If to Advisor:
[ADVISOR NAME]
[ADDRESS]
[ATTENTION]
or to such other address as either party may designate in writing from time to time.
13. Counterparts.
This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but all such counterparts shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.
[COMPANY NAME]
By: [NAME]
Title: [TITLE]
[ADVISOR NAME]
By: [NAME]
Title: [TITLE]
How Gold House M&A can Help
Gold House M&A plays a crucial role in M&A sell-side transactions, providing invaluable expertise and guidance throughout the process. Here's how we can help:
1. Strategic Guidance and Planning:
Structuring the Deal: Gold House M&A advises on the most advantageous legal structure for the transaction, such as asset sale, share sale, or merger.
Regulatory Compliance: We ensure compliance with all applicable laws and regulations, including securities laws, antitrust laws, and foreign investment regulations.
Due Diligence: Gold House M&A conducts legal due diligence to identify and assess potential risks and liabilities, such as litigation, environmental issues, and intellectual property disputes.
2. Drafting and Negotiating Agreements:
Advisory Agreement: Gold House M&A reviews and negotiates the terms of the advisory agreement, ensuring that the company's interests are protected.
Confidentiality Agreements (CAs): We draft and review CAs with potential buyers to safeguard confidential information.
Term Sheets and Purchase Agreements: Gold House M&A drafts, reviews, and negotiates key transaction documents, including term sheets, letters of intent, and definitive purchase agreements.
Representations and Warranties: We advise on and negotiate representations and warranties made by the company to the buyer, ensuring that the company's liability is appropriately limited.
3. Managing the Transaction Process:
Due Diligence Coordination: Gold House M&A coordinates the due diligence process, responding to buyer requests and addressing due diligence issues.
Regulatory Filings: We assist with the preparation and filing of necessary regulatory filings.
Closing Assistance: Gold House M&A provides guidance and support throughout the closing process, ensuring that all necessary documentation is in order and that the transaction is completed smoothly.
4. Post-Closing Matters:
Integration Support: Gold House M&A provides guidance on post-closing integration matters, such as employee transfers, asset transfers, and contract amendments.
Key Benefits of Engaging Gold House M&A:
Minimizing Risk: Gold House M&A helps to identify and mitigate potential risks and liabilities associated with the transaction.
Maximizing Value: Gold House M&A helps to ensure that the company achieves the best possible deal terms and maximizes the value of the transaction.
Ensuring Compliance: Gold House M&A ensures that the transaction is conducted in compliance with all applicable laws and regulations.
Providing Peace of Mind: Having Gold House M&A on your side provides peace of mind and confidence throughout the complex M&A process.
By engaging Gold House M&A, companies can navigate the complexities of M&A transactions with greater confidence and increase their chances of achieving successful outcomes.
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