AMENDMENT NO. 1 TO AMENDED AND RESTATED STOCK PURCHASE AGREEMENT
Exhibit
10.1
AMENDMENT
NO. 1 TO
AMENDED
AND RESTATED STOCK PURCHASE AGREEMENT
This
Amendment No. 1 (this “Amendment”) is made
and entered into as of the 28th day of
November, 2008 by and between InterAmerican Acquisition Group, Inc., Sing Kung
Ltd., ▇▇▇ ▇▇▇▇ and certain other stockholders named
therein. Capitalized terms used but not defined herein have the
meanings assigned to them in the Purchase Agreement (as defined
below).
WHEREAS,
the parties to this Amendment entered into an Amended and Restated Stock
Purchase Agreement (the “Purchase Agreement”)
dated as of May 15, 2008.
WHEREAS,
the parties hereto desire to amend the Purchase Agreement.
NOW,
THEREFORE, in consideration of the mutual agreements herein contained, the
parties agree as follows:
1. Section
1.2(i) of the Purchase Agreement is hereby amended by deleting such provision in
its entirety and replacing in lieu thereof the following:
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“(i)
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certificates
representing 19,834,417 of CNC’s ordinary shares, par value $0.0001 per
share (“CNC
Stock”), to be delivered to the Stockholders, of which 4,010,904
shares (allocated pro rata among the Stockholders) shall be held in escrow
and subject to a right of repurchase by CNC, as described in Section 1.4
below (the “Stockholders
Adjustment Shares”).”
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2. The
first paragraph and following two tables contained in Section 1.3 of the
Purchase Agreement are hereby amended by deleting such paragraph and tables in
their entirety and replacing in lieu thereof the following:
“Earn-Out
Agreement. So long as the Net Income of CNC, on a consolidated
basis, achieves or exceeds the Threshold Net Income (as defined below) targets
(as set forth below) calculated for the period of January 1 to the
succeeding December 31, ending on December 31 in each of 2009, 2010,
2011 and 2012, the Stockholders shall receive the number of shares of CNC Stock
set forth below with respect to such year (the “Incentive
Shares”). The payment of these additional shares is in
exchange for the Sing Kung Stock and is not contingent upon the continued
employment or other relationships of the Stockholders with any
entity. If the respective target is achieved or exceeded, such
additional shares shall be issued 15 days following the issuance of the audit
report for CNC for such fiscal year. The value of shares payable
under this Section 1.1 shall also be available for indemnification pursuant to
ARTICLE X.
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Threshold
Net Income Targets for 12 Months Ending
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December
31
2008
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December
31
2009
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December
31
2010
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December
31
2011
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December
31
2012
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$38,000,000
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$56,000,000
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$80,000,000
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$112,000,000
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$151,200,000
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Shares
Issuable Upon Achieving or Exceeding the Respective Threshold Net Income
Targets
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December
31
2009
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December
31
2010
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December
31
2011
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December
31
2012
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3,100,000
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3,100,000
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3,100,000
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3,100,000
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3. Section
1.4(i)b. and Section 1.4(ii) of the Purchase Agreement are hereby amended by
deleting such provisions in their entirety and replacing in lieu thereof the
following:
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“b
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Partial
Distribution. If the Net Income of CNC for 2008 (calculated
in accordance with Section 1.3) is less than the Threshold Net Income
Target, then a number of EPS Adjustment Shares shall be distributed to the
Stockholders and CC respectively (a "Partial
Distribution") that would result in CNC achieving the same Net
Income per CNC share as it would have achieved if it had met the Threshold
Net Income Target for 2008 (the "Reference
EPS"). For purposes of this paragraph: (i) Reference
EPS shall be calculated by dividing the Threshold Net Income
($38,000,000) by the fully diluted shares issued as of year-end 2008,
or calculated as if the Closing had occurred prior to December 31, 2008
(the "Y-E
Shares"); (ii) subject to required adjustments for fundamental
changes or changes in conversion ratios, the Y-E Shares will equal
37,411,111 shares, the calculation of which is intended to include all
issued and outstanding shares plus all shares issuable upon conversion of
outstanding preferred shares of Sing Kung or CNC and exercise of all of
the outstanding IAG (or CNC) warrants and options; (iii) based on the
foregoing, the Reference EPS is $1.016 per share. If a Partial
Distribution is required in accordance with this paragraph, then the
calculation of the number of EPS Adjustment Shares that is to be
withheld from a Partial Distribution (the "Escrowed
Shares") shall be made as follows: (Step 1) Actual Net
Income shall be divided by the Reference EPS; (Step 2) the
resulting number of shares from Step 1 shall be subtracted from the
Y-E Share amount and the difference shall be the Escrowed Shares.
The number of EPS Adjustment Shares to be distributed pursuant to a
Partial Distribution shall be calculated by subtracting the Escrowed
Shares from the EPS Adjustment Shares (4,222,004 minus Escrowed
Shares).
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(ii)
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Subsequent
Release. All Escrowed Shares shall be issued within 15
days following the delivery of the final annual consolidated audit report
for the first annual audit subsequent to 2009 in which CNC meets the
Threshold Net Income
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Target
for the year covered by the audit report, as set forth in Section 1.3; the
distribution of the EPS Adjustment Shares shall be to Stockholders of record as
of December 31 of the year of the qualifying audit report, and the issuance
shall be in proportion to such Stockholders’ holdings of Sing Kung Stock on such
record date. The value of shares distributable under Section 1.4(ii) shall also
be available for indemnification pursuant to ARTICLE X to the extent not
previously paid. In any subsequent release, if CC has not made an
election to exchange its Sing Kung shares, then the shares distributed to CC
shall be the applicable number of original CC shares deposited to the escrow and
Stockholders shall receive the applicable number of CNC shares.”
4. A
new Section 6.21 shall be added to the Purchase Agreement as
follows:
“6.21 Amendment
to CC Letter Agreement. Sing Kung shall use its best efforts
to amend that certain letter agreement between IAG and CC dated May 15, 2008 to
provide that the “CC Adjustment Shares” shall be reduced from 500,000 shares of
Sing Kung Stock (or CNC Stock if exchanged pursuant to the election of CC) to
211,100 shares.”
5. A new
Section 7.10 shall be added to the Purchase Agreement as follows:
“7.10 Reduction
in Shares of Common Stock. Prior to the Closing, IAG shall
take such actions as required to reduce the number of shares of its common stock
(including the warrants to purchase 185,000 shares of common stock for an
exercise price of $0.01 per share) by 129,150 shares of common stock to a total
of 7,055,850 shares of common stock.”
6. The
definition of “CC Adjustment Shares” contained in Section 12.1 of the Purchase
Agreement shall be amended by deleting “500,000 shares” and inserting in lieu
thereof “211,100 shares.”
7. A new
Section 13.13 shall be added to the Purchase Agreement as follows:
“13.13 Exchange
Offer. The Parties agree that the exchange offer of IAG
(through CNC) for the remaining ordinary shares of Sing Kung shall be for
1,076,070 ordinary shares of CNC and the exchange offer for the Sing Kung
preferred stock shall be for 2,685,774 ordinary shares of CNC.”
8. Except as
expressly amended by this Amendment, the parties agree that all other provisions
of the Purchase Agreement remain unchanged and that the Purchase Agreement
remains in full force and effect.
9. This
Amendment may be executed in two or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument.
[SIGNATURE
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IN
WITNESS WHEREOF, the Parties have caused this Amendment No. 1 to the Purchase
Agreement to be executed as of November 28, 2008.
Agreed
and accepted by:
SING
KUNG LTD on behalf of itself and STOCKHOLDERS
By: ___________________________
Name:
It’s:
authorized signatory for all Stockholders
Agreed
and accepted by:
INTERAMERICAN
ACQUISITON GROUP INC.
By:
_______________________________
Name:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Its: Chief
Executive Officer
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