LETTER AGREEMENT WITH H. DAVID SHERMAN
Exhibit
10.9
LETTER
AGREEMENT WITH ▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇
[____________],
2008
Room
409,
4/F Aetna Tower
▇▇▇
▇▇▇▇▇
▇▇▇▇
Shanghai,
200051, China
▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇, Incorporated
▇▇▇
▇▇▇▇▇
▇▇▇▇▇▇
Baltimore,
Maryland 21202
Re:
Initial
Public Offering
Gentlemen:
The
undersigned director and shareholder of China Growth Alliance Ltd.
(“Company”),
in
consideration of ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Incorporated (“FBW”)
agreeing to underwrite an initial public offering of the securities of the
Company (“IPO”)
and
embarking on the IPO process, hereby agrees as follows (certain capitalized
terms used herein are defined in paragraph 11 hereof):
1. If
the
Company solicits approval of its stockholders of a Business Combination, the
undersigned will vote all shares of Ordinary Shares of the Company
(“Ordinary
Shares”),
including the Insider Shares and IPO Shares, owned by him in accordance with
the
majority of the votes cast by the holders of the IPO Shares.
2.
The
undersigned will escrow his Insider Shares, if any, until the earlier of: (i)
one year after the Company’s consummation of a Business Combination, (ii) three
years from the effective date of the Company’s prospectus (“Prospectus”),
or
(iii) the consummation of a liquidation, share reconstruction and amalgamation,
stock exchange or other similar transaction which results in all of the
Company’s shareholders having the right to exchange their Ordinary Shares for
cash, securities or other property subsequent to the Company’s consummating a
Business Combination with a target acquisition, at which time such Insider
Shares will be released from escrow, unless the Company were to engage in a
transaction after the consummation of its initial Business Combination that
results in all of the shareholders of the combined entity having the right
to
exchange their ordinary shares for cash, securities or other property; but
in
each case subject to the terms of a Securities Escrow Agreement which the
Company will enter into with the undersigned and an escrow agent acceptable
to
the Company.
3. In
the
event that the Company fails to consummate a Business Combination within
24 months from the effective date (“Effective
Date”)
of the
registration statement relating to the IPO (the “Termination
Date”),
the
undersigned will take all reasonable actions within his power as soon as
reasonably practicable following the Termination Date to cause the Company
to
distribute to all of the public shareholders in the manner and subject to the
deductions set forth in the Prospectus. The undersigned hereby waives any and
all right, title, interest or claim of any kind (“Claim”)
in or
to any distribution of the Company’s trust account described in the Prospectus
(the “Trust
Account”)
with
respect to his Insider Shares and waives any Claim the undersigned may have
in
the future as a result of, or arising out of, any contracts or agreements with
the Company and will not seek recourse against the Trust Account for any reason
whatsoever, except for valid claims for indemnification and expense
reimbursement. Notwithstanding the foregoing, the undersigned may receive
distributions from the Trust Account in respect of its IPO Shares and/or any
Ordinary Shares acquired in the aftermarket.
4. In
order
to minimize potential conflicts of interest which may arise from multiple
affiliations, the undersigned agrees to present to the Company for its
consideration, prior to presentation to any other person or entity, any suitable
opportunity to acquire an operating business, until the earlier of the
consummation by the Company of a Business Combination, the liquidation of the
Company or until such time as the undersigned ceases to be an director of the
Company, but taking into account, in each case, any pre-existing fiduciary
obligations the undersigned might have, which fiduciary obligations are
disclosed to the Company’s board of directors prior to the Effective Date or
which are disclosed in the Prospectus,
together with new
fiduciary obligations related to or affiliated with entities to whom the
undersigned has pre-existing fiduciary obligations, including, but not limited
to, fiduciary obligations to next generation, follow-on or successor entities
to
any entities to which the undersigned has pre-existing
obligations.
5. Other
than as set forth in this letter agreement, the undersigned acknowledges and
agrees that the Company will not consummate any Business Combination which
involves a company which is affiliated with any of the Insiders unless the
Company obtains an opinion from an independent investment banking firm
reasonably acceptable to FBW that the business combination is fair to the
Company’s stockholders from a financial perspective.
6. Neither
the undersigned, any member of the family of the undersigned, or any affiliate
of the undersigned will be entitled to receive or accept a finder’s fee or any
other compensation in the event the undersigned, any member of the family of
the
undersigned or any affiliate of the undersigned originates a Business
Combination.
7. The
undersigned confirms that he is acting as a director of the Company and consents
to being named in the registration statement of which the Prospectus forms
a
part. The undersigned agrees to serve in such capacity and to not resign (or
advise the Company’s board of directors that he declines to seek re-election to
the Board of Directors) from his position as a director of the Company as set
forth in the Prospectus without the prior consent of FBW (such consent not
to be
unreasonably withheld, conditioned or delayed) until the earlier of the
consummation by the Company of a Business Combination and the completion of
the
Company’s winding up, dissolution and liquidation. The undersigned may, however,
and without violating this Paragraph 7, terminate his association with the
Company for Good Reason by giving the Company thirty (30) days written
notice. “Good
Reason”
means:
(i) the occurrence of a physical or mental condition of the undersigned or
his immediate family which prevents the undersigned from acting in his capacity
with the Company for a period of forty-five (45) consecutive days or
(ii) the commission by the Company or its executive officers or directors
(excluding the undersigned) of any material fraud, unlawful act or breach of
fiduciary duty relating to the Company or its operations. The
undersigned’s biographical information furnished to the Company and FBW and
attached hereto as Exhibit A
is true
and accurate in all respects, does not omit any material information with
respect to the undersigned’s background. The undersigned represents and warrants
that:
(a)
he
is not
subject to or a respondent in any legal action for, any injunction
cease-and-desist order or order or stipulation to desist or refrain from any
act
or practice relating to the offering of securities in any
jurisdiction;
(b)
he
has
never been convicted of or pleaded guilty to any crime (i) involving any
fraud or (ii) relating to any financial transaction or handling of funds of
another person, or (iii) pertaining to any dealings in any securities and
he is not currently a defendant in any such criminal proceeding;
and
(c)
he
has
never been suspended or expelled from membership in any securities or
commodities exchange or association or had a securities or commodities license
or registration denied, suspended or revoked.
8. The
undersigned has full right and power, without violating any agreement by which
he is bound, to enter into this letter agreement and to serve as a director
of
the Company.
9. Neither
the undersigned, any member of the family of the undersigned, nor any affiliate
of the undersigned will be entitled to receive and will not accept any
compensation for services rendered to the Company prior to the consummation
of
the Business Combination; provided that the undersigned shall be entitled to
reimbursement from the Company for his out-of-pocket expenses incurred in
connection with seeking and consummating a Business Combination.
10.
The
undersigned authorizes any employer, financial institution, or consumer credit
reporting agency to release to FBW and its legal representatives or agents
(including any investigative search firm retained by FBW) any information they
may have about the undersigned’s background and finances (“Information”),
purely for the purposes of the Company’s IPO (and shall thereafter hold such
information confidential). Neither FBW nor its agents shall be violating the
undersigned’s right of privacy in any manner in requesting and obtaining the
Information and the undersigned hereby releases them from liability for any
damage whatsoever in that connection.
11. As
used
herein: (i) a “Business
Combination”
shall
mean an acquisition by share reconstruction and amalgamation, capital stock
exchange, asset or stock acquisition, reorganization or otherwise, of an
operating business selected by the Company; (ii) “Insiders”
shall
mean all officers, directors and stockholders of the Company immediately prior
to the IPO; (iii) “Insider
Shares”
shall
mean all of the shares of Ordinary Shares and warrants to purchase Ordinary
Shares of the Company owned by an Insider prior to the IPO; and (iv)
“IPO
Shares”
shall
mean the Ordinary Shares included within the subunits issued in the Company’s
IPO.
[Remainder
of page intentionally left blank]
If
the
foregoing terms and conditions are acceptable to you, kindly indicate your
acceptance below, whereupon this letter shall be a binding legal agreement
among
us.
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Name:
▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇
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| ACCEPTED AND AGREED: | |
| China Growth Alliance Ltd. | |
| By: |
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Name:
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Title:
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EXHIBIT
A
BIOGRAPHICAL
INFORMATION