Unassociated Document


     

     

    THE
SECURITIES BEING SUBSCRIBED TO HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR WITH ANY
SECURITIES REGULATORY AUTHORITY OF ANY JURISDICTION.  THESE SECURITIES
ARE OFFERED PURSUANT TO A CLAIM OF EXEMPTION FROM THE REGISTRATION REQUIREMENTS
OF FEDERAL AND STATE SECURITIES LAWS.

    


    THE
SECURITIES BEING SUBSCRIBED TO MAY NOT BE SOLD, OFFERED, OR OTHERWISE
TRANSFERRED IN THE UNITED STATES OR TO A "U.S. PERSON" UNLESS THE SECURITIES ARE
REGISTERED UNDER THE SECURITIES ACT OR AN EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT IS AVAILABLE.

    


    CHINA
ADVANCED CONSTRUCTION MATERIALS GROUP, INC.

    


    REGULATION
S SUBSCRIPTION AGREEMENT

    (Foreign
Subscribers)

    


    


    Dated:
____________                                                      

    


    
      	
              Name
      and Address of Subscriber

               

              _______________________________

               

              _______________________________

               

              _______________________________

               

            	
              Amount
      of Investment

               

              Aggregate
      Price $___________

               

              Per
      Share Price $2.30    

               

              Number
      of Shares Purchased

               

              _______________________________

               

            


    

    


    


    REGULATION
S SUBSCRIPTION AGREEMENT, dated as of the date specified above, by and between
China Advanced Construction Materials Group, Inc., a Delaware corporation (the
"Company"), and the
undersigned subscriber (the "Subscriber").

    


    BACKGROUND

    


    The
Company is seeking to raise capital through an offering (the “Offering”) to non-U.S. Persons
of shares of the Company’s Common Stock, $0.001 par value per share (“Common Stock”).  The
Subscriber desires to subscribe for the number of shares of Common Stock
specified in the box above (the “Shares”).

    


    NOW, THEREFORE, in consideration of the
premises and the respective promises hereinafter set forth, the parties hereto
hereby agree as follows:

    


    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    1.           SALE AND PURCHASE OF
SECURITIES.  Subject to compliance with applicable U.S and
foreign securities laws, the Subscriber hereby is granted the right to subscribe
for all, but not less than all, of the Shares at a price per Share equal to
$2.30 (the “Per Share
Price”) or an aggregate of the Aggregate Price specified above (the
“Aggregate
Price”).  The payment of the Aggregate Price shall be made to
the Company by delivery of a certified check or through other means acceptable
to the Company not later than 5:00 p.m. United States Eastern Time on the date
hereof or on such other date as is acceptable to the Company.

     

    


    2.           REPRESENTATIONS AND
WARRANTIES OF THE SUBSCRIBER. The Subscriber by his signature below
hereby represents, warrants and certifies to the Company as
follows:

     

    (a)           Access to
Information.  The Subscriber, in making the decision to
purchase the Shares, has relied upon its independent investigations made by it
and/or its representatives, if any.  Except as set forth in this
Agreement, no representations, assurances or warranties have been made to the
Subscriber or its advisers, by the Company or by any of its respective officers,
directors, agents, employees, or affiliates, nor anyone else on their behalf,
concerning, among other things, the future profitability of the Company or the
Subscriber’s investment in it.  The Subscriber and/or its
representatives during the course of this transaction, and prior to the purchase
of any Shares, has had the opportunity to ask questions of and receive answers
from the management of the Company concerning the business of the Company and to
receive any additional information, documents, records and books relative to the
business, assets, financial condition, results of operations and liabilities
(contingent or otherwise) of the Company.  The Subscriber has obtained
copies of the reports filed by the Company with the Securities and Exchange
Commission (the “SEC”)
since the filing of the Company’s last annual report on Form 10-K (the “SEC Filings”), including the
Company’s most recently filed quarterly and current reports filed with the SEC
and has carefully reviewed all of the information contained in the SEC Filings,
including the risk factors contained in such reports and fully understands all
of the disclosure contained therein.  The Subscriber recognizes that
the Shares as an investment involve significant risks.

     

    (b)           Sophistication and
Knowledge.  The Subscriber and/or its representatives has such
knowledge and experience in financial and business matters that it can represent
itself and is capable of evaluating the merits and risks of the purchase of the
Shares.  The Subscriber is not relying on the Company with respect to
the tax and other economic considerations of an investment in the Shares, and
the Subscriber has relied on the advice of, or has consulted with, only the
Subscriber's own advisor(s).  The Subscriber represents that it has
not been organized for the purpose of acquiring the Shares.

     

    (c)           Lack of
Liquidity.  The Subscriber acknowledges that the purchase of
the Shares involves a high degree of risk and further acknowledges that it can
bear the economic risk of the purchase of the Shares, including the total loss
of its investment.  The Subscriber acknowledges and understands that
the Shares may not be sold to a U.S. Person (as hereinafter defined) or into the
United States for a period of six (6) months from the date of purchase and that
Subscriber has no present need for liquidity in connection with its purchase of
the Shares.

     

    (d)           No Public
Solicitation.  The Subscriber is not subscribing for the Shares
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, or any
solicitation of a subscription by a person not previously known to the
Subscriber in connection with investments in securities
generally.  Neither the Company nor the Subscriber has engaged in any
‘Directed Selling Efforts in the U.S.’ as defined in Regulation S promulgated by
the SEC pursuant to The Securities Act of 1933, as amended (the “Securities Act”).

     

    
      
         

      

      
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    (e)           Authority.  The
Subscriber has full right and power to enter into and perform pursuant to this
Agreement and make an investment in the Company, and this Agreement constitutes
the Subscriber’s valid and legally binding obligation, enforceable in accordance
with its terms.  The Subscriber is authorized and otherwise duly
qualified to purchase and hold the Shares and to enter into this
Agreement.

     

    (f)           Brokers or
Finders.  No person has or will have, as a result of the
transactions contemplated by this Agreement, any right, interest or valid claim
against or upon the Company for any commission, fee or other compensation as a
finder or broker because of any act or omission by such Subscriber or its
respective agents.

     

    (g)           Compliance with Local
Laws.  Any resale of the Shares during the ‘distribution
compliance period’ as defined in Rule 902(f) to Regulation S shall only be made
in compliance with exemptions from registration afforded by Regulation
S.  Further, any such sale of the Shares in any jurisdiction outside
of the United States will be made in compliance with the securities laws of such
jurisdiction.  Subscriber will not offer to sell or sell the Shares in
any jurisdiction unless the Subscriber obtains all required consents, if
any.

     

    (h)           Regulation S
Exemption.  The Subscriber understands, acknowledges and agrees
that the offering and sale of the Shares to the Subscriber has not been
registered under the Securities Act or under any state securities laws or
regulations and that the Shares are being offered and sold to it in reliance on
an exemption from the registration requirements of United States federal and
state securities laws under Regulation S promulgated under the Securities Act
and that the Company is relying upon the truth and accuracy of the
representations, warranties, agreements, acknowledgments and understandings of
the Subscriber set forth herein in order to determine the applicability of such
exemptions and the suitability of the Subscriber to acquire the
Shares.  In this regard, the Subscriber represents, warrants and
agrees that:

     

    (i)           The
Subscriber is not a U.S. Person (as defined below) and is not an affiliate (as
defined in Rule 501(b) under the Securities Act) of the Company.  A
U.S. Person means any one of the following:

     

    1)           any
natural person resident in the United States of America;

     

    2)           any
partnership or corporation organized or incorporated under the laws of the
United States of America;

     

    3)           any
estate of which any executor or administrator is a U.S. person;

     

    4)           any
trust of which any trustee is a U.S. person;

     

    5)           any
agency or branch of a foreign entity located in the United States of
America;

     

    
      
         

      

      
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    6)           any
non-discretionary account or similar account (other than an estate or trust)
held by a dealer or other fiduciary for the benefit or account of a U.S.
person;

     

    7)           any
discretionary account or similar account (other than an estate or trust) held by
a dealer or other fiduciary organized, incorporated or (if an individual)
resident in the United States of America; and

     

    8)           any
partnership or corporation if:

     

    a.           organized
or incorporated under the laws of any foreign jurisdiction; and

     

    b.           formed
by a U.S. person principally for the purpose of investing in securities not
registered under the Securities Act, unless it is organized or incorporated, and
owned, by accredited investors (as
defined in Rule 501(a) under the Securities Act) who are not natural persons,
estates or trusts.

     

    (ii)           At
the time of the origination of contact concerning this Agreement and the date of
the execution and delivery of this Agreement, the Subscriber was outside of the
United States.

     

    (iii)           The
Subscriber will not, during the period commencing on the date of issuance of the
Shares and ending on the first anniversary of such date, or such shorter period
as may be permitted by Regulation S or other applicable securities law (the
“Restricted Period”),
offer, sell, pledge or otherwise transfer the Shares in the United States, or to
a U.S. Person for the account or for the benefit of a U.S. Person, or otherwise
in a manner that is not in compliance with Regulation S.  At no time
shall the Subscriber offer or sell the Shares unless they are registered under
the Securities Act or are exempt from the registration requirements of the
Securities Act and any applicable state or foreign securities laws or
regulations.

     

    (iv)           The
Subscriber will, after expiration of the Restricted Period, offer, sell, pledge
or otherwise transfer the Shares only pursuant to registration under the
Securities Act or an available exemption therein and, in accordance with all
applicable state and foreign securities laws.

     

    (v)           The
Subscriber has not in the United States, engaged in, and prior to the expiration
of the Restricted Period will not directly or indirectly engage in, any short
selling of or any hedging or similar transaction with respect to the Shares,
including without limitation, any put, call or other option transaction, option
writing or equity swap.

     

    (vi)           Neither
the Subscriber nor or any person acting on its behalf has engaged, nor will
engage, in any directed selling efforts to a U.S. Person with respect to the
Shares and the Subscriber and any person acting on its behalf have complied and
will comply with the “offering restrictions” requirements of Regulation S under
the Securities Act.

     

    (vii)           The
transactions contemplated by this Agreement have not been pre-arranged with a
buyer located in the United States or with a U.S. Person, and are not part of a
plan or scheme to evade the registration requirements of the Securities
Act.

     

    
      
         

      

      
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    (viii)           Neither
the Subscriber nor any person acting on its behalf has undertaken or carried out
any activity for the purpose of, or that could reasonably be expected to have
the effect of, conditioning the market in the United States, its territories or
possessions, for any of the Shares.  The Subscriber agrees not to
cause any advertisement of the Shares to be published in any newspaper or
periodical or posted in any public place and not to issue any circular relating
to the Shares, except such advertisements that include the statements required
by Regulation S under the Securities Act, and only offshore and not in the U.S.
or its territories, and only in compliance with any local applicable securities
laws.

     

    (i)           Legends.  Each
certificate representing the Shares shall be endorsed with the following
legends, in addition to any other legend required to be placed thereon by
applicable federal or state securities laws:

     

    (i)           “THESE
SECURITIES ARE BEING OFFERED TO INVESTORS WHO ARE NOT U.S. PERSONS (AS DEFINED
IN REGULATION S UNDER THE SECURITIES ACT OF 1933, AS AMENDED (“THE SECURITIES
ACT”)) AND WITHOUT REGISTRATION WITH THE UNITED STATES SECURITIES AND EXCHANGE
COMMISSION UNDER THE SECURITIES ACT IN RELIANCE UPON REGULATION S PROMULGATED
UNDER THE SECURITIES ACT.”

     

    (ii)           “TRANSFER
OF THESE SECURITIES IS PROHIBITED, EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF
REGULATION S, PURSUANT TO REGISTRATION UNDER THE SECURITIES ACT, OR PURSUANT TO
AVAILABLE EXEMPTION FROM REGISTRATION.  HEDGING TRANSACTIONS MAY NOT
BE CONDUCTED UNLESS IN COMPLIANCE WITH THE SECURITIES ACT.”

     

    (j)           Stop Transfer
Orders.  The Subscriber consents to the Company making a
notation on its records or giving instructions to any transfer agent of the
Company in order to implement the restrictions on transfer of the Shares set
forth in this agreement and as required by Regulation S.

     

    (k)           USA PATRIOT
Act.  The Subscriber is not, nor is it acting as an agent,
representative, intermediary or nominee for, a person identified on the list of
blocked persons maintained by the Office of Foreign Assets Control, U.S.
Department of Treasury.  In addition, the Subscriber has complied with
all applicable U.S. laws, regulations, directives, and executive orders relating
to anti-money laundering, including but not limited to the following laws: (1)
the Uniting and Strengthening America by Providing Appropriate Tools Required to
Intercept and Obstruct Terrorism Act of 2001, Public Law 107-56; and (2)
Executive Order 13224 (Blocking Property and Prohibiting Transactions with
Persons Who Commit, Threaten to Commit, or Support Terrorism) of September 23,
2001.  The Subscriber shall ensure that it obtains a representation
similar to the foregoing from any transferee of the Shares of the Company’s
Common Stock purchased by the Subscriber pursuant to this
Agreement.  Further, this transaction and any resale of Shares by the
Subscriber to transferees shall not violate the statutes mentioned in this
representation.

     

    (l)           Transfers Must Comply with
Regulation S.  Notwithstanding anything contained herein to the
contrary, the Company may refuse to register any transfer of the Shares of
common stock of the Company that are not made in accordance with Regulation S,
pursuant to the registration under the Securities Act or pursuant to an
available exemption from registration.

     

    
      
         

      

      
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    (m)           No Registration
Rights.  The Subscriber understands, acknowledges and agrees
that the Company has no obligation to register the Shares for resale, whether
pursuant to the Securities Act or otherwise.

    


    3.           INDEMNITY BY THE
SUBSCRIBER.  The Subscriber understands and acknowledges that
the Company is relying on the representations made by the Subscriber herein,
and, thus, hereby agrees to indemnify the Company, and its respective officers
and directors, agents, attorneys, and employees, and agrees to hold them
harmless from and against any and all loss, damage, liability, or expense,
including reasonable attorney's fees, that it or any of them may suffer,
sustain, or incur by reason of or in connection with any misrepresentation or
breach of warranty or agreement made by the Subscriber under this
Agreement.

     

    4.           MARKET STANDOFF
PROVISION.  The Subscriber hereby agrees that, if so requested
by the Company or any representative of the underwriters (the “Managing Underwriter”) in
connection with any registration of the offering of any securities of the
Company under the Securities Act, the Subscriber shall not sell or
otherwise transfer any Securities or other securities of the Company during the
180-day period (or such other period as may be requested in writing by the
Managing Underwriter and agreed to in writing by the Company) (the “Market Standoff Period”)
following the effective date of a registration statement of the Company filed
under the Securities Act. The Company may impose stop-transfer instructions
with respect to Securities subject to the foregoing restrictions until the end
of such Market Standoff Period.

     

    5.           ADDITIONAL
ACTION.  The Subscriber shall, upon the request of the Company,
from time to time, execute and deliver promptly to the Company all instruments
and documents of further assurances or otherwise and will do any and all such
acts and things as may be reasonably required to carry out the obligations of
the Subscriber hereunder and to consummate the transactions contemplated
hereby.

     

    6.           MISCELLANEOUS.

     

    (a)           This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective legal representatives, heirs, successors and
assigns.  This Agreement shall not be assignable, in whole or in
part.

     

    (b)           This
Agreement and any additional agreements and other documents delivered pursuant
hereto set forth the entire agreement and understanding of the parties in
respect of the subject matter hereof and thereof and supersede all prior
agreements, arrangements and understandings relating to the subject matter
hereof and thereof.  This Agreement may not be contradicted by
evidence of prior, contemporaneous or subsequent oral agreements of the
parties.

     

    (c)           This
Agreement may be executed simultaneously in two or more counterparts, each of
which shall be deemed an original, but all of which shall constitute one and the
same instrument.  Facsimile execution and delivery of this Agreement
is legal, valid and binding for all purposes.

     

    (d)           The
invalidity or unenforceability of any provision of this Agreement shall not
affect any other provisions hereof, and the remainder of the Agreement shall be
construed as if such invalid or unenforceable provision were modified to the
extent necessary to make it valid or enforceable but remain within the spirit of
this Agreement, or if that is not possible, then omitted.

     

    
      
         

      

      
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    (e)           All
notices provided for in this Agreement shall be in writing signed by the party
giving such notice, and delivered personally or sent by overnight courier or
messenger or sent by registered or certified mail, return receipt requested, or
by telex, facsimile transmission, telegram or similar means of communication if
confirmed by mail to the Company at its current address or such other address as
may be specified in the Company’s reports that are filed from time to time with
the SEC and to the Subscriber at its address as it appears on the books and
records of the Company.  Notices shall be deemed to have been received
on the date of personal delivery or facsimile, or if sent by certified or
registered mail, return receipt requested, shall be deemed to be delivered on
the third business day after the date of mailing.  A copy of any
notice shall also be delivered to the Company’s counsel, Pillsbury Winthrop Shaw
Pittman LLP, 50 Fremont Street, San Francisco, CA 94105, Attention: Scott C.
Kline, Esq., Facsimile:  415.983.1523.

     

    
      	
               
      

            	
              (f)

            	
              Governing Law;
      Venue.

            


    

     

    (i)           This
Agreement shall be enforced, governed and construed in accordance with the laws
of the State of New York without giving effect to choice of laws principles or
conflict of laws provisions thereof.

     

    (ii)           In
the event of any dispute or difference arising out of or relating to this
Agreement (the “Dispute”), the parties hereto
shall use their best efforts to settle such Dispute.  To this end, the
parties shall consult and negotiate with each other, in good faith and
understanding of their mutual interests, to reach a just and equitable solution
satisfactory to both parties.  If they do not reach such a solution
within a period of thirty (30) days, either party may then by written notice to
the other (the “Notice of
Arbitration”) submit the dispute to final and binding arbitration in the
State of New York in accordance with the International Arbitration Rules of the
American Arbitration Association (AAA).  The Company and the
Subscriber expressly consent and agree to arbitration
hereunder.  Within seven (7) days after receipt of the Notice of
Arbitration, the Company shall nominate and appoint an arbitrator (the “First Arbitrator”) and the
Subscriber shall nominate and appoint an arbitrator (the “Second
Arbitrator”).  Within seven (7) days after the appointment of
the First Arbitrator and the Second Arbitrator, the two arbitrators shall
appoint a third arbitrator (the “Third Arbitrator”), or, if the
first two arbitrators cannot agree on the appointment of the third, the Third
Arbitrator shall be selected by the AAA.  If either party fails or
refuses to appoint the First Arbitrator or the Second Arbitrator within the
specified time, the arbitrator appointed by the other party shall be the sole
arbitrator for purposes of resolving the Dispute.  The arbitrators or
the sole arbitrator, as the case may be, shall resolve the Dispute and render an
award within one hundred eighty (180) days after receipt of the Notice of
Arbitration.  Judgment upon the award may be entered, or application
for judicial acceptance or confirmation of the award may be made, in any
competent court having jurisdiction thereof.  In the event of any
Dispute, the parties shall continue to perform their respective obligations
under this Agreement during the pendency of arbitration proceedings unless and
until the arbitration panel otherwise orders.

     

    (iii)           The
parties hereby irrevocably consent and submit to the jurisdiction of the state
and federal courts located in the State of New York for all purposes, including
the enforcement of a judgment of an arbitration award resulting from any
arbitration pursuant hereto.

     

    
      
         

      

      
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    (iv)           Subscriber
hereby waives, and agrees not to assert against the Company, or any successor
assignee thereof, by way of motion, as a defense, or otherwise, in any such
suit, action or proceeding, (i) any claim that the Subscriber is not personally
subject to the jurisdiction of the above-named courts or to an arbitration
proceeding hereunder, and (ii) to the extent permitted by applicable law, any
claim that such arbitration proceeding or proceeding relating to the enforcement
of an arbitration award is in an inconvenient forum or that the venue of any
such proceeding is improper or that this Agreement may not be enforced in or by
arbitration or that judgment upon an arbitration award may not be entered in any
such courts

     

    [signature page follows]

     

    
      
         

      

      
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    SUBSCRIBER
SIGNATURE PAGE

    


    IN WITNESS WHEREOF, the Subscriber has
executed this Regulation S Subscription Agreement as of the date first above
written.

     

    
      	 	 	 
	 	 For
      Individuals:	 
	 	 	 	 
	 	 	 	 
	
               

            	
                 
      

            	 
	 	Print
      Name Above	 
	 	 	 	 
	 	 	    
       	 
	 	    
      	 
	 	Sign
      Name Above	 
	 	 	 	 
	 	 	 	 
	 	For
      Entities:	 
	 	 	 	 
	 	 	 	 
	 	    
      	 
	 	Print
      Name of Entity Above	 
	 	 	 	 
	 	 	 	 
	 	By: 	     
      	 
	 	 	Name:	 
	 	 	Title:	 


    

     

    
      
         

      

      
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    CHINA
ADVANCED CONSTRUCTION MATERIALS GROUP, INC.

    SUBSCRIPTION
ACCEPTANCE

    


    IN WITNESS WHEREOF, the undersigned,
intending to be legally bound, hereby accepts the subscription by _________
to purchase _________ Shares in accordance with the terms of the foregoing
Subscription Agreement as of the date first above written.

     

    
      	 	CHINA
      ADVANCED CONSTRUCTION
MATERIALS
      GROUP, INC.	 
	 	 	 
	 	 	 	 
	
               

            	
              By:
      

            	 	 
	 	 	 	 
	 	Its:	    
      	 
	 	 	 	 


    

     

    
      
         

      

      
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