SUBSCRIPTION AGREEMENT
10.6
This
SUBSCRIPTION
AGREEMENT
(this
“Agreement”)
made
as of this 26th day of December, 2007 for the benefit of Infinity I-China
Acquisition Corporation, a company formed under the laws of the Cayman Islands
(the “Company”),
having its principal place of business at Xxxx 0000, Xxx Xxxxxx, 00 Xxxxx’x Xxxx
Xxxxxxx, Xxxx Xxxx by the persons or entities listed on the signature page
hereto under the heading “Subscriber” (each, a “Subscriber”
and
collectively, the “Subscribers”).
WHEREAS,
the Company desires to sell an aggregate of 1,500,000 warrants (the
“Warrants”)
each
exercisable for one ordinary share of the Company for a purchase price of $1.00
per Warrant (i.e., an aggregate purchase price of $1,500,000); and
WHEREAS,
the
offer and sale of the Warrants (the “Offering”)
is
being made in reliance upon the provisions of Regulation S (“Regulation
S”)
promulgated by the Securities and Exchange Commission (the “SEC”)
under
the Securities Act of 1933, as amended (the “Securities
Act”);
WHEREAS,
Subscribers wish to purchase the Warrants and the Company wishes to accept
such
subscription.
NOW,
THEREFORE, in consideration of the premises and the mutual covenants hereinafter
set forth and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Company and Subscribers hereby agree
as
follows
1. Agreement
to Subscribe
1.1 Purchase
and Issuance of the Warrants.
Upon
the terms and subject to the conditions of this Agreement, Subscribers hereby
agree to purchase from the Company, and the Company hereby agrees to sell to
the
Subscriber, on the date of the Closing (as defined below), the number of
Warrants indicated on the signature page hereto by the caption, “Number of
Warrants Being Subscribed” which Warrants will be issued to the Subscribers, or
their affiliates or designees. The aggregate purchase price for each
Subscriber’s Warrants (the “Purchase
Price”)
is
indicated on the signature page hereto by the caption, “Purchase
Price.”
1.2 Delivery
of the Purchase Price.
Upon
execution of this Agreement each Subscriber is hereby bound to fulfill its
obligations hereunder and hereby irrevocably commits to deliver to the Company
on the date of Closing (as hereinafter defined) the Purchase Price by bank
check, wire transfer or such other form of payment as shall be acceptable to
the
Company, in its sole and absolute discretion, at the Closing. Any such check
delivered to the Company shall be made payable to the order of “Infinity I-China
Acquisition Corporation.” The Company irrevocably commits to deliver the
Purchase Price into a trust account (the “Trust
Account”)
maintained by American Stock Transfer & Trust Company.
1.3 Closing.
The
date of the Closing of the Offering (the “Closing”),
shall
take place at the offices of the Company immediately prior to the effective
date
of the registration statement pursuant to which the Company proposes to register
its initial public offering (the “IPO”)
of
4,500,000 units consisting of Ordinary Shares and Warrants. The proceeds of
the
Offering shall be deposited in the Company’s Trust Account as described in the
registration statement for the Company’s IPO. Upon Closing, each Subscriber’s
Warrants and ordinary shares underlying the Warrants (the “Warrant
Shares”)
shall
be deemed to be held in escrow until deposited with the escrow agent as
described in the registration statement for the Company’s IPO.
2. Representations
and Warranties of the Subscriber
Each
Subscriber represents and warrants to the Company that:
2.1 No
Government Recommendation or Approval.
Subscriber understands that no United States federal or state agency or similar
agency of any other country has passed upon or made any recommendation or
endorsement of the Company or the Offering of the Warrants or Warrant
Shares.
2.2 Not
a
“U.S. Person”.
Subscriber is not a “U.S. Person” as defined in Rule 902 of Regulation S
promulgated under the Securities Act, was not organized under the laws of any
United States jurisdiction, and was not formed for the purpose of investing
in
securities not registered under the Securities Act. At the time the purchase
order for this transaction was originated, the Subscriber was outside the United
States.
2.3 Intent.
Subscriber is purchasing the Warrants solely for investment purposes, for
Subscriber’s own account and not for the account or benefit of any U.S. person,
and not with a view towards the distribution or dissemination thereof and
Subscriber has no present arrangement to sell the Warrants to or through any
person or entity. Subscriber understands the Warrants must be held indefinitely
unless such Warrants are resold in accordance with the provisions of Regulation
S, are subsequently registered under the Securities Act or an exemption from
registration is available.
2.4 Restrictions
on Transfer.
Subscriber understands the Warrants are being offered in a transaction not
involving a public offering in the United States within the meaning of the
Securities Act. The Warrants have not been registered under the Securities
Act,
and, if in the future the Subscriber decides to offer, resell, pledge or
otherwise transfer the Warrants, such Warrants may be offered, resold, pledged
or otherwise transferred only: (A) pursuant to an effective registration
statement filed under the Securities Act, (B) to a non-U.S. person in an
offshore transaction in accordance with Rule 903 or Rule 904 of Regulation
S of
the Securities Act, (C) pursuant to the resale limitations set forth in Rule
905
of Regulation S, (D) pursuant to an exemption from registration under the
Securities Act provided by Rule 144 thereunder (if available) or (E) pursuant
to
any other exemption from the registration requirements of the Securities Act,
and in each case in accordance with any applicable securities laws of any state
of the United States or any other jurisdiction. Subscriber acknowledges, agrees
and covenants it will not engage in hedging transactions with regard to the
Warrants prior to the expiration of the distribution compliance period specified
in Rule 903 of Regulation S promulgated under the Securities Act, unless in
compliance with the Securities Act. Subscriber agrees that if any transfer
of
its Warrants or any interest therein is proposed to be made, as a condition
precedent to any such transfer, the Subscriber may be required to deliver to
the
Company an opinion of counsel satisfactory to the Company. Absent registration
or another exemption from registration, the Subscriber agrees it will not resell
the securities constituting the Subscriber's Warrants to U.S. Persons or within
the United States.
2.5 Sophisticated
Investor.
(i) Subscriber
is sophisticated in financial matters and is able to evaluate the risks and
benefits of the investment in the Warrants.
(ii) Subscriber
is able to bear the economic risk of his investment in the Warrants for an
indefinite period of time because none of the Warrants have been registered
under the Securities Act and therefore cannot be sold unless subsequently
registered under the Securities Act or an exemption from such registration
is
available.
2
2.6 Independent
Investigation.
Subscriber, in making the decision to purchase the Warrants, has relied upon
an
independent investigation of the Company and has not relied upon any information
or representations made by any third parties or upon any oral or written
representations or assurances from the Company, its officers, directors or
employees or any other representatives or agents of the Company, other than
as
set forth in this Agreement and the Warrants. Subscriber is familiar with the
business, operations and financial condition of the Company and has had an
opportunity to ask questions of, and receive answers from, the Company’s
officers and directors concerning the Company and the terms and conditions
of
the offering of the Warrants and has had full access to such other information
concerning the Company as the Subscriber has requested.
2.7 Authority.
This
Agreement has been validly authorized, executed and delivered by the Subscriber
and is a valid and binding agreement enforceable in accordance with its terms,
subject to the general principles of equity and to bankruptcy or other laws
affecting the enforcement of creditors' rights generally. The execution,
delivery and performance of this Agreement by the Subscriber does not and will
not conflict with, violate or cause a breach of any agreement, contract or
instrument to which the Subscriber is a party.
2.8 No
Legal Advice from Company.
Subscriber acknowledges that he, she or it has had the opportunity to review
this Agreement and the transactions contemplated by this Agreement and the
other
agreements entered into between the parties hereto with the Subscriber's own
legal counsel and investment and tax advisors. Except for any statements or
representations of the Company made in this Agreement and the other agreements
entered into between the parties hereto, the Subscriber is relying solely on
such counsel and advisors and not on any statements or representations of the
Company or any of its representatives or agents for legal, tax or investment
advice with respect to this investment, the transactions contemplated by this
Agreement or the securities laws of any jurisdiction.
2.9 Reliance
on Representations and Warranties.
Subscriber understands the Warrants are being offered and sold to the Subscriber
in reliance on exemptions contained in specific provisions of United States
federal and state securities laws and that the Company is relying upon the
truth
and accuracy of the representations, warranties, agreements, acknowledgments
and
understandings of the Subscriber set forth in this Agreement in order to
determine the applicability of the exemptions contained in such provisions.
2.10 No
Advertisements.
The
undersigned is not subscribing for the Warrants as a result of or subsequent
to
any advertisement, article, notice or other communication published in any
newspaper, magazine, or similar media or broadcast over television or radio,
or
presented at any seminar or meeting.
2.11 Legend.
Subscriber acknowledges and agrees the Warrants, and when issued the Warrant
Shares, shall bear restricted legends (the “Legends”),
in
the form and substance as set forth in Section 4 hereof, prohibiting the offer,
sale, pledge or transfer of the securities, except (i) pursuant to an effective
registration statement filed under the Securities Act, (ii) in accordance with
the applicable provisions of Regulation S, promulgated under the Securities
Act,
(iii) pursuant to an exemption from registration provided by Rule 144 under
the
Securities Act (if available), and (iv) pursuant to any other exemption from
the
registration requirements of the Securities Act.
3. Representations
and Warranties of the Company
The
Company represents and warrants to each Subscriber that:
3.1 Valid
Issuance of Capital Stock.
The
total number of shares of all classes of capital stock which the Company has
authority to issue is 20,000,000 Ordinary Shares and 1,000,000 preferred shares.
As of the date hereof, the Company has 1,293,750 Ordinary Shares issued and
outstanding. All of the issued shares of capital stock of the Company have
been
duly authorized, validly issued, and are fully paid and
non-assessable.
3
3.2 Organization
and Qualification.
The
Company is a corporation duly incorporated and existing in good standing under
the laws of the Cayman Islands and has the requisite corporate power to own
its
properties and assets and to carry on its business as now being
conducted.
3.3 Authorization;
Enforcement.
(i) The
Company has the requisite corporate power and authority to enter into and
perform its obligations under this Agreement and to issue the Warrants in
accordance with the terms hereof, (ii) the execution, delivery and performance
of this Agreement by the Company and the consummation by it of the transactions
contemplated hereby have been duly authorized by all necessary corporate action,
and no further consent or authorization of the Company or its Board of Directors
or shareholders is required, and (iii) this Agreement constitutes valid and
binding obligations of the Company enforceable against the Company in accordance
with its terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, fraudulent conveyance, moratorium, reorganization,
or
similar laws relating to, or affecting generally the enforcement of, creditors'
rights and remedies or by equitable principles of general application and except
as enforcement of rights to indemnity and contribution may be limited by federal
and state securities laws or principles of public policy.
3.4 No
Conflicts.
To the
knowledge of the Company, the execution, delivery and performance of this
Agreement and the consummation by the Company of the transactions contemplated
hereby do not materially (i) result in a violation of the Company's Memorandum
and Articles of Association or (ii) conflict with, or constitute a default
under
any agreement, indenture or instrument to which the Company is a party. Other
than any SEC or state securities filings which may be required to be made by
the
Company subsequent to the Closing, and any registration statement which may
be
filed pursuant thereto, the Company is not required under federal, state or
local law, rule or regulation to obtain any consent, authorization or order
of,
or make any filing or registration with, any court or governmental agency or
self-regulatory entity in order for it to perform any of its obligations under
this Agreement or issue the Ordinary Shares in accordance with the terms
hereof.
4. Legends;
Denominations
4.1 Legend.
The
Company will issue the Warrants, and when issued the Warrant Shares, purchased
by the Subscriber in the name of the Subscriber and in such denominations to
be
specified by the Subscriber prior to the Closing. The Warrants and Warrant
Shares will bear the following Legends and appropriate “stop transfer”
instructions:
THESE
SECURITIES HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT
OF
1933, AS AMENDED (THE “SECURITIES ACT”),
OR
ANY STATE SECURITIES LAWS
AND
THESE SECURITIES MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED
EXCEPT (A) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT FILED UNDER THE
SECURITIES ACT, (B) TO A NON-U.S. PERSON IN AN OFFSHORE TRANSACTION IN
ACCORDANCE WITH RULE 903 OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT,
(C) PURSUANT TO THE RESALE LIMITATIONS SET FORTH IN RULE 905 OF REGULATIONS
S
UNDER THE SECURITIES ACT, (D) PURSUANT TO AN EXEMPTION FROM REGISTRATION
PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE) OR (E) PURSUANT
TO
ANY OTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT,
IN
EACH CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF
THE
UNITED STATES OR ANY OTHER JURISDICTION. HEDGING TRANSACTIONS INVOLVING THESE
SECURITIES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE SECURITIES
ACT.
4
SECURITIES
EVIDENCED BY THIS CERTIFICATE WILL BE ENTITLED TO REGISTRATION RIGHTS UNDER
A
REGISTRATION RIGHTS AGREEMENT TO BE EXECUTED BY THE COMPANY.
“THE
SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE TERMS AND
CONDITIONS CONTAINED IN A SECURITIES ESCROW
AGREEMENT (THE “AGREEMENT”) AND MAY NOT BE OFFERED, SOLD, TRANSFERRED, PLEDGED
OR OTHERWISE DISPOSED DURING THE TERM OF THE ESCROW PERIOD (AS DEFINED IN THE
AGREEMENT).”
4.2 Subscriber's
Compliance.
Nothing
in this Section 4 shall affect in any way the Subscriber’s obligations and
agreement to comply with all applicable securities laws upon resale of the
Warrants, and the Warrant Shares.
4.3 Company’s
Refusal to Register Transfer of Warrants.
The
Company shall refuse to register any transfer of the Warrants and the Warrant
Shares, not made in accordance with (i) the provisions of Regulation S, (ii)
pursuant to an effective registration statement filed under the Securities
Act,
or (iii) pursuant to an available exemption from the registration requirements
of the Securities Act.
5. Escrow
Upon
consummation of the IPO, the holders of the Warrants shall enter into a
securities escrow agreement with American Stock Transfer & Trust Company,
whereby the Warrants shall be held in escrow until the day after the date of
the
consummation of the initial Business Combination.
6. Waiver
of Liquidation Distributions
In
connection with the Warrants purchased pursuant to this Agreement, the
Subscribers hereby waive any and all right, title, interest or claim of any
kind
in or to the Trust Account and any liquidating distributions by the Company
in
the event of a liquidation of the Company upon the Company's failure to timely
complete a Business Combination. For purposes of clarity, in the event the
Subscribers purchase Ordinary Shares in the IPO or in the aftermarket such
shares shall be eligible to receive any liquidating distributions by the
Company.
7. Governing
Law; Jurisdiction; Waiver of Jury Trial
This
Agreement shall be governed by and construed in accordance with the laws of
the
State of New York. The parties hereto hereby waive any right to a jury trial
in
connection with any litigation pursuant to this Agreement and the transactions
contemplated hereby.
8. Forfeiture
of Warrants.
5
8.1. Failure
to Consummate Business Combination.
The
Warrants shall be forfeited to the Company in the event that the Company does
not consummate a Business Combination within 24 months from the date of the
final prospectus relating to the Company’s IPO, or 36 months in the event the
extended period is approved.
8.2. Termination
of Rights as holder; Escrow.
If the
Warrants are forfeited in accordance with this Section 8, then after such time
the Subscriber (or successor in interest), shall no longer have any rights
as a
holder of such Warrants, and the Company shall take such action as is
appropriate to cancel such Warrants. To effectuate the foregoing, all
certificates representing the Warrants shall be held in escrow as provided
in
Section 5 hereof. In addition, Subscriber hereby irrevocably grants the Company
a limited power of attorney for the purpose of effectuating the
foregoing.
9. Rescission
Right Waiver and Indemnification.
9.1.
Each
Subscriber understands and acknowledges an exemption from the registration
requirements of the Securities Act requires there be no general solicitation
of
purchasers of the Warrants. In this regard, if the IPO were deemed to be a
general solicitation with respect to the Warrants, the offer and sale of such
Warrants may not be exempt from registration and, if not, each Subscriber may
have a right to rescind its purchase of the Warrants. In order to facilitate
the
completion of the Offering and in order to protect the Company, its shareholders
and the Trust Account from claims that may adversely affect the Company or
the
interests of its shareholders, each Subscriber hereby agrees to waive, to the
maximum extent permitted by applicable law, any claims, right to xxx or rights
in law or arbitration, as the case may be, to seek rescission of its purchase
of
the Warrants. Each Subscriber acknowledges and agrees this waiver is being
made
in order to induce the Company to sell the Warrants to such Subscriber. Each
Subscriber agrees the foregoing waiver of rescission rights shall apply to
any
and all known or unknown actions, causes of action, suits, claims or proceedings
(collectively, “Claims”)
and
related losses, costs, penalties, fees, liabilities and damages, whether
compensatory, consequential or exemplary, and expenses in connection therewith,
including reasonable attorneys’ and expert witness fees and disbursements and
all other expenses reasonably incurred in investigating, preparing or defending
against any Claims, whether pending or threatened, in connection with any
present or future actual or asserted right to rescind the purchase of the
Warrants hereunder or relating to the purchase of the Warrants and the
transactions contemplated hereby.
9.2. Each
Subscriber agrees not to seek recourse against the Trust Account for any reason
whatsoever in connection with its purchase of the Warrants or any Claim that
may
arise now or in the future.
9.3. Each
Subscriber acknowledges and agrees the shareholders of the Company, Xxxxxx
Xxxxxx & Co. Inc. and Legend Merchant Group are and shall be third-party
beneficiaries of the foregoing provisions of this Agreement.
9.4.
Each
Subscriber agrees that to the extent any waiver of rights under this Section
9
is ineffective as a matter of law, such Subscriber has offered such waiver
for
the benefit of the Company as an equitable right that shall survive any
statutory disqualification or bar that applies to a legal right. Each Subscriber
acknowledges the receipt and sufficiency of consideration received from the
Company hereunder in this regard.
6
10. Terms
of the Warrant
The
Warrants are substantially identical to the warrants included in the units
offered in the IPO, except: (i) they
will not have a claim to the funds held in the trust account, (ii) they
will be placed in escrow and not released before, except in limited
circumstances, until after the consummation of a Business Combination as more
fully described in Section 5, (iii) they are being purchased in a private
placement pursuant to an exemption from the registration requirements of the
Securities Act and will become freely tradable only after they are registered
pursuant to a registration rights agreement to be entered on or before the
date
of the final prospectus relating to the Company’s IPO, (iv) they will be
non-redeemable so long as they are held by
Subscriber (or any of its permitted assigns),
(v) they are exercisable (a) on a “cashless” basis if
held
by the Subscriber or its permitted assigns
and (b)
may not be sold, assigned or transferred until the consummation of a business
combination, (vi) they will not have rights to any liquidation distribution,
and
(vii) may be exercised in the absence of an effective registration statement
covering the Ordinary Shares underlying the Warrants. In the event the Company
fails to consummate a business combination the Warrants will expire worthless.
In
no
event will the Company be required to net cash settle the Warrant
exercise.
11. Assignment;
Entire Agreement; Amendment
11.1 Assignment.
Neither
this Agreement nor any rights hereunder may be assigned by any party to any
other person other than by Subscriber to a person agreeing to be bound by the
terms hereof.
11.2 Entire
Agreement.
This
Subscription Agreement and the Warrants set forth the entire agreement and
understanding between the parties as to the subject matter thereof and merges
and supersedes all prior discussions, agreements and understandings of any
and
every nature among them.
11.3 Amendment.
Except
as expressly provided in this Agreement, neither this Agreement nor any term
hereof may be amended, waived, discharged or terminated other than by a written
instrument signed by the party against whom enforcement of any such amendment,
waiver, discharge, or termination is sought.
11.4 Binding
Upon Successors.
This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and to their respective heirs, legal representatives, successors and
assigns.
12. Notices;
Indemnity
12.1 Notices.
Unless
otherwise provided herein, any notice or other communication to a party
hereunder shall be sufficiently given if in writing and personally delivered
or
sent by facsimile with copy sent in another manner herein provided or sent
by
courier (which for all purposes of this Agreement shall include Federal Express
or other recognized overnight courier) or mailed to said party by certified
mail, return receipt requested, at its address provided for herein or such
other
address as either may designate for itself in such notice to the other and
communications shall be deemed to have been received when delivered personally,
on the scheduled arrival date when sent by next day or 2-day courier service,
or
if sent by facsimile upon receipt of confirmation of transmittal or, if sent
by
mail, then three days after deposit in the mail. If given by electronic
transmission, such notice shall be deemed to be delivered (a) if by electronic
mail, when directed to an electronic mail address at which the Subscriber has
consented to receive notice; (b) if by a posting on an electronic network
together with separate notice to the Subscriber of such specific posting, upon
the later of (1) such posting and (2) the giving of such separate notice; and
(c) if by any other form of electronic transmission, when directed to the
Subscriber.
12.2 Indemnification.
Each
party shall indemnify the other against any loss, cost or damages (including
reasonable attorney's fees and expenses) incurred as a result of such party's
breach of any representation, warranty, covenant or agreement in this
Agreement.
7
13. Counterparts
This
Agreement may be executed in any number of counterparts, each of which shall
be
enforceable against the parties actually executing such counterparts, and all
of
which together shall constitute one instrument.
14. Survival;
Severability
14.1 Survival.
The
representations, warranties, covenants and agreements of the parties hereto
shall survive the Closing.
14.2 Severability.
In the
event that any provision of this Agreement becomes or is declared by a court
of
competent jurisdiction to be illegal, unenforceable or void, this Agreement
shall continue in full force and effect without said provision; provided that
no
such severability shall be effective if it materially changes the economic
benefit of this Agreement to any party.
15. Titles
and Subtitles
The
titles and subtitles used in this Agreement are used for convenience only and
are not to be considered in construing or interpreting this
Agreement.
[Signature
page follows]
8
This
subscription is accepted by the Company on the 26th
day of
December, 2007.
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By:
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/s/
Amir Gal-Or
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Name:
Amir Gal-Or
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Title:
Co-Chief Executive Officer, Co-President
and
Co-Chairman
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| SUBSCRIBER: | ||
| INFINITY I-CHINA FUND (CAYMAN), L.P. | ||
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| By: | /s/ Amir Gal-Or | |
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Number
of
Warrants: 664,800
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| INFINITY I-CHINA FUND (ISRAEL), L.P. | ||
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| By: | /s/ Amir Gal-Or | |
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Number
of
Warrants: 454200
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| INFINITY I-CHINA FUND (ISRAEL 2), L.P. | ||
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| By: | /s/ Amir Gal-Or | |
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Number
of
Warrants: 381,000
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