AMENDMENT NO.1 TO SUBSCRIPTION AGREEMENT

EX-10.1 2 f8k0511ex10i_chinagrowth.htm AMENDMENT NO.1 TO SUBSCRIPTION AGREEMENT f8k0511ex10i_chinagrowth.htm

Exhibit 10.1

AMENDMENT NO.1 TO

SUBSCRIPTION AGREEMENT

This AMENDMENT NO.1 TO SUBSCRIPTION AGREEMENT (this “Amendment”) dated as of May 20, 2011 (the “Effective Date”) is entered into by and among China Growth Corporation, a Cayman Island corporation (the “Company”), and American Access Fund, LP hereto (the “Majority Holder”).

Recitals

WHEREAS, pursuant to an offering by the Company of its securities (the “Offering”), to the Majority Holder and certain other investors (the “Investors”), the Company and the Investors entered into a Subscription Agreement, dated December 2010 (the “Original Agreement”), pursuant to which the Company sold to the Investors an aggregate of 222,402 units (the “Units”) for an aggregate purchase price of $6,672,031. Each Unit consisted of (i) two (2) shares of the Company’s Class A 6% convertible preference share (the “Preference Shares”) and (ii) a warrant to purchase five (5) of the Company’s ordinary shares at an exercise price of $4.50 per share;

WHEREAS, Section 5.5 of the Original Agreement provides that subject, to the terms and provisions of the Holdback Escrow Agreement, as soon as possible, but no later than three (3) months after the Share Exchange, the Company shall employ a English-speaking Chief Financial Officer who shall have experience with financial reporting companies under Sarbanes-Oxley and other federal or state securities laws and shall also meet the approval and requirements of the Lead Investor, $1,500,000 of the Offering proceeds (the “Chief Financial Officer Holdback”) shall be held in escrow until such Chief Financial Officer is duly appointed;

WHEREAS, in recognition of the Company’s efforts in seeking a qualified Chief Financial Officer, and in light of the Company’s having made significant strides towards hiring a financial advisor, the Majority Holder desires that $750,000 of Chief Financial Officer Holdback be released to the Company;

WHEREAS, an amendment of the Original Agreement requires the approval of the Company and the holders of at least 50.1% of the Preference Shares then outstanding; and

WHEREAS, the Majority Holder is the holder of 233,334 Preference Shares, representing approximately 52.5% of the Preference Shares outstanding as of the Effective Date.

NOW, THEREFORE, in consideration of the foregoing, and of the mutual representations, warranties, covenants, and agreements herein contained, the parties hereto agree as follows:

Agreement

Section 1. Defined Terms. Unless otherwise indicated herein, all terms which are capitalized but are not otherwise defined herein shall have the meaning ascribed to them in the Original Agreement.

Section 2. Amendment to Original Agreement. Section 5.5 of the Original Agreement is hereby amended and restated in its entirety as follows:

“5.5 Chief Financial Officer. As soon as practicable after the Share Exchange, the Company shall employ an English-speaking Chief Financial Officer who shall have experience with financial reporting companies under Sarbanes-Oxley and other federal or state securities laws and shall also meet the approval and requirements of the Lead Investor, which such approval shall not be unreasonably withheld (a “Qualified CFO”). To secure the Company’s employment of a Qualified CFO, $1,500,000 (the “Chief Financial Officer Holdback”) of the Offering proceeds shall be held in escrow and subject to the terms and provisions of the Holdback Escrow Agreement. Notwithstanding the foregoing, the Lead Investor may in its sole discretion authorize, in writing, the escrow agent appointed pursuant to the Holdback Escrow Agreement to disburse a portion of the Chief Financial Officer Holdback, such portion not to exceed $750,000 in the aggregate, to the Company (a “Good Faith Disbursement”). Any portion of the Chief Financial Officer Holdback not disbursed pursuant to a Good Faith Disbursement shall continue to be held in escrow in accordance with the terms and provisions of the Holdback Escrow Agreement.”

Section 3. Ratifications; Inconsistent Provisions. Except as otherwise expressly provided herein, the Original Agreement, is, and shall continue to be, in full force and effect and is hereby ratified and confirmed in all respects, except that on and after the Effective Date: (i) all references in the Original Agreement to “this Agreement”, “hereto”, “hereof”, “hereunder” or words of like import referring to the Original Agreement shall mean the Original Agreement as amended by this Amendment and (ii) all references in the other Transaction Documents, to “the Subscription Agreement”, “the Subscription Agreement”, “thereto”, “thereof”, “thereunder” or words of like import referring to the Original Agreement shall mean the Original Agreement as amended by this Amendment. Notwithstanding the foregoing to the contrary, to the extent that there is any inconsistency between the provisions of the Original Agreement and this Amendment, the provisions of this Amendment shall control and be binding.

Section 4. Counterparts. This Amendment may be executed in any number of counterparts, all of which will constitute one and the same instrument and shall become effective when one or more counterparts have been signed by each of the parties and delivered to the other party. Facsimile or other electronic transmission of any signed original document shall be deemed the same as delivery of an original.

[Signatures follow on next page]

IN WITNESS WHEREOF, the Majority Holder and the Company have caused this Amendment to be duly executed as of the date first written above.

	Company:

	CHINA GROWTH CORPORATION

	By:	/s/ Mingzhuo Tan
		Name: Mingzhuo Tan
		Title: President and Chief Executive Officer

	Majority Holder:

	AMERICAN ACCESS FUND, LP

	By:	/s/ Christopher Efird
		Name: Christopher Efird
		Title: Managing Partner