Exhibit 10.2

 

EXCLUSIVE EQUITY INTEREST PURCHASE AGREEMENT

  

 

THIS EXCLUSIVE EQUITY INTEREST PURCHASE AGREEMENT（the “Agreement”） is entered
into by and between the following parties on December 1, 2015.

 

Party A: Recon HengdaTechnology (Beijing) Co.,Ltd., a limited liability company
(wholly invested by Taiwan, Hong Kong or Macau investors) duly established and
valid existing under the PRC laws. Registered Address: Room 5771, Floor 5,
Shenchang Building, Courtyard 51, Zhichun Road, Haidian District, Beijing,
China.

 

Party B: HUANG Baokun, SHI Jing, LI Suzhen.

HUANG Baokun ID Num.:

SHI Jing ID Num.:

LI Suzhen ID Num.:

 

Party C: Qinghai Hua You Downhole Technology Co., Ltd., a limited liability
company duly established and valid existing under the PRC laws.

Registered Address: Courtyard 0467, Huancheng Road, Huatugou town, Mangya
District, Qinghai, China.

 

WHEREAS,

 

1.Party B collectively holds 100% equity interest in Party C;

 

2.Party A and Party C have entered into a series of Agreements including the
Exclusive Consulting and Service Agreement.

 

NOW THEREFORE, through mutual negotiations, the Parties hereto agree as follows:

 

 

1.Transfer of Equity Interest

 

1.1Granting Right

 

Under PRC law, Party B hereby irrevocably grants Party A the exclusive right to
purchase, or designate one or more persons (the “Specified Person”) to purchase,
a portion or whole of the Equity Interest of Party C held by Party B at the
price set forth in Article 1.3 hereof in accordance with the procedure
promulgated by Party A at any time in Party A’s discretion.(the “Purchase
Right”). Except for Party A and the Specified Person, Party C shall not sell the
Equity Interest to any third party. Party C hereby agrees that Party B may grant
the Purchase Right to Party A. For the purpose of this Agreement, the “person”
stipulated herein refers to individual, corporation, joint venture, partnership,
enterprise, trust or non-corporation organization.

 

 1 

 

  

1.2Procedure

 

The exercise of the Purchase Right by Party A shall be subject to the laws and
regulations of the PRC. When Party A intends to exercise the Purchase Right, it
shall issue a written notice (the “Purchase Notice”) to Party B which shall
contain the following items: (a) Party A intends to exercise the Purchase Right;
(b) the percentage of the Equity Interest to be purchased therewith (the
“Purchased Equity Interest”); and (c) the effective date or transfer date.

 

1.3Transfer Fee

 

The Transfer Fee (“Transfer Fee”) shall be confirmed by and between Party A and
Party B through negotiation according to the appraisal of the Equity Interest
approved by the competent authority, and it shall be the lowest price allowable
by the PRC laws and regulations. Party B hereby unconditionally and irrevocably
agrees that, in the event that Party A exercises its Purchase Right, Party B
shall unconditionally refund to Party A the Transfer Fee in full.

 

1.4Transfer of the Equity Interest

 

Each time when Party A exercises the Purchase Right:

 

1.4.1Party B shall procure that Party C timely convene a shareholders’ meeting
and shall pass the shareholders’ resolutions that Party B could transfer to
Party A or the Specified Person the Equity Interest.

 

1.4.2Party B shall enter into Equity Transfer Agreement with Party A (or the
Specified Person, if applicable) in accordance with this Agreement and Purchase
Notice.

 

1.4.3Related parties shall execute all other necessary agreements or documents,
and obtain all necessary government approvals and consents, and take all
necessary actions to lawfully transfer the title to the Equity Interests to
Party A or the Specified Person and procure Party A or the Specified Person to
be registered as the holder of the Equity Interest. The Equity Interest should
be free from any Security Interest. For the purpose of this Agreement, Security
Interest shall include guarantee, mortgage, any third party’s right or interest,
any purchase right, pre-emption right, offset right and any other security
arrangements. Notwithstanding the foregoing, the Security Interest shall not
include any security interest accrued in accordance with this Agreement and the
Equity Interest Pledge Agreement which is entered into by and between Party B
and Party A on December 1, 2015 (“Equity Interest Pledge Agreement”). According
to the Equity Interest Pledge Agreement, Party B shall pledge all the equity
possessed by Party B in Party C to Party A as a guarantee to the performance of
the Exclusive Technical Consulting and Service Agreement which is entered into
by and between Party C and Party A on December 1, 2015 (“Exclusive Technical
Consulting and Service Agreement”).

 

 2 

 

 

1.5Payments for the Equity Interest

 

1.5.1 Party A shall pay the Transfer Fee to Party B in accordance with Article
1.3 hereof.

 

2.Warranties Relating to the Equity Interest

 

2.1Party C hereby guarantees that:

 

2.1.1Absent prior written consent of Party A or the Specified Person, Party C
will not supplement, amend, or modify any provision of the Articles of
Association of the company, and shall not increase or decrease its registered
capital, or alter the equity structure in other methods.

 

2.1.2Party C shall be legally existing, and prudently and efficiently operates
its business and deals with corporate affairs in accordance with commercial
standards and practice.

 

2.1.3Absent prior written consent of Party A or the specific person, Party C
shall not sell, transfer, mortgage or dispose of any asset, business or
beneficial right of Party C, or allow creation of any other Security Interest.

 

2.1.4Absent prior written consent of Party A or the specific person, Party C
shall not incur, inherit, guarantee or bear any debt except for (i) the debt is
incurred during the routine business instead of loan; and (ii) the debt has been
disclosed to Party A and has obtained Party A’s written consent.

 

2.1.5Party C shall operate its routine business to keep the value of its assets,
and shall not result in any material influence on its business operation and the
value of its asset by acts or omissions.

 

2.1.6Absent prior written consent of Party A or the specific person, Party C
shall not enter into any material agreement except for the purpose of routine
business operation. (For the purpose of this provision, an agreement covering an
amount in excess of RMB100,000 shall be deemed as a material agreement).

 

2.1.7Absent prior written consent of Party A or the specific person, Party C
shall not provide any loan or credit to any third party.

 

 3 

 

 

2.1.8Party C shall provide all materials relating to its operation and financial
status to Party A upon Party A’s request.

 

2.1.9Party C shall effect and maintain insurance from the insurance company
acceptable to Party A. The amount and types of such insurance shall be the same
with the alike companies which operate the similar business and possess the
similar assets with Party C in the same distraction.

 

2.1.10Absent prior written consent of Party A or the specific person, Party C
shall not merge with, combine with or purchase any entity or make investments to
any entity.

 

2.1.11Party C shall promptly inform Party A of any existing or potential
litigation, arbitration, or administrative procedure in relation to Party C’s
assets, business and revenue.

 

2.1.12Party C shall make all necessary efforts to maintain the title to its
assets, including but not limited to execute all necessary or proper documents,
commence all necessary or proper claims, or make all necessary or proper
defences to all claims.

 

2.1.13Absent prior written consent of Party A, Party C shall not distribute any
dividend to any shareholder. Nevertheless, Party C shall immediately distribute
all payable dividends to the shareholders upon request of Party A or the
specified person.

 

2.2Party B hereby guarantees that:

 

2.2.1Absent prior written consent of Party A or the specific person, Party B
shall not sell, transfer, mortgage or dispose of any right or interest relating
to the Equity Interest, or allow any creation of other Security Interest on the
Equity Interest. However the Security Interest accrued from this Agreement and
the Equity Interest Pledge Agreement shall be excluded.

 

2.2.2Party B shall promptly inform Party A of any existing or potential
litigation, arbitration, or administrative procedure in relation to the Equity
Interest.

 

2.2.3Party B shall make all necessary efforts to maintain its title to the
equity of Party C, including but not limited to execute all necessary or proper
documents, commence all necessary or proper claims, or make all necessary or
proper defences to all claims.

 

2.2.4Upon the request of Party A, Party B shall immediately transfer its Equity
Interest to Party A or the Specified Person unconditionally at any time.

 

 4 

 

 

2.2.5Party B shall strictly comply with and duly perform this Agreement and any
other agreements entered into by and between Party B, Party C, and Party A
collectively or respectively and shall not affect the validity and
enforceability of such agreements by acts or omissions.

 

3.Representations and Warranties

 

3.1Party B and Party C hereby collectively and respectively represent and
warrant to Pary A that on and till the execution date of this Agreement and each
and every transfer day thereafter:

 

3.1.1It has the authority and ability to enter into and duly perform this
Agreement and each and every Equity Transfer Agreement executed thereafter by
Party B or Party C collectively or respectively. Such Agreements shall be
legally and effectively binding on the parties thereof and shall be enforceable
in accordance with the provisions thereof.

 

3.1.2The execution, delivery and performance of this Agreement or any Equity
Transfer Agreement thereafter shall not: (i) violate any PRC laws; (ii) conflict
with its Articles of Association or other organizational documents; (iii) breach
any contract or document of which Party B and/or Party C is a party or which
binds Party B and/or Party C; (iv) violate any acquired permit, approval or any
valid qualification thereof; or (v) result in the ceasing or revocation or
additional conditions to the acquired permit or approval.

 

3.1.3Party B retains full and transferable title to its assets and facilities
and absent any security interest other than the security interest accrued in
this Agreement and the pledge set by the Equity Interests Pledge Agreement.

 

3.1.4Party B or any person designated by Party B shall unconditionally transfer
any funds obtained from Party C in full to Party A (including but not limited to
dividends, bonus, other rights, earnings and so forth distributed by Party C.)

 

3.1.5Prior to Party A’s lawful exercise of Purchase Right, Party B shall not
request Party C to distribute any dividend, bonus and other right and earning
and so forth absent Party A’s permit.

 

3.1.6Party C has no outstanding debt except for (i) the legal debt, which is
incurred during its routine business operation instead of loan; (ii) the debt
has been disclosed to Party A and has obtained Party A’s written permit.

 

3.1.7Party C shall comply with all applicable laws and regulations relating to
equity transfer.

 

 5 

 

 

3.1.8There is no existing, pending or potential litigation, arbitration, or
administrative procedure in relation to the Equity Interest, assets of Party C
and other matters of Party C.

 

3.2Party A hereby represents and warrants to Party B and Party C on the
execution date of this Agreement and each transfer day thereafter:

 

(i)Party A shall be obligated to provide continual financial support to Party C
in the event that Party C requires to obtain funds support for business
operation;

 

(ii)In the event that Party C fails to repay the funds provided by Party A due
to Party C’s operation losses, Party A hereby agrees to forego the right to seek
repayment.

 

 

4.Effective Date

 

This Agreement shall take effect upon execution by the Parties (“Effective
Date”), the term shall be ten (10) years, and it may be extended by another ten
(10) years if Party A so requires.

 

5.Governing Law and Dispute Resolution

 

5.1Governing Law

 

This Agreement shall be governed by and construed in accordance with PRC laws.

 

5.2Dispute Resolution

 

With regards to any dispute in relation to the interpretation or implementation
of this Agreement, the Parties shall negotiate friendly to settle the dispute.
If it can not be settled within thirty (30) days from the date any party issuing
written notice requesting settlement of dispute through negotiation, each party
has the right to submit it to China International Economic and Trade Arbitration
Committee for arbitration according to the valid arbitration rules. The
arbitration shall be held in Beijing. The arbitration award shall be final and
binding on each party.

 

6.Tax and Expenditures

 

Each party shall bear its own tax, costs and expenditures relating to preparing
for and executing this Agreement and Equity Transfer Contract and relating to
completing the contemplated deal.

 

7.Notice

 

Any notice or other communication under this Agreement shall be in Chinese and
be sent to the address listed below or other address as may be designated from
time to time by personal delivery or mail or facsimile. Any notice required or
given hereunder shall be deemed to have been served: (a) the same date if sent
by personal delivery; (b) the tenth date from delivery (subject to the stamp) of
a prepaid air-mail, or the fourth date from delivering to a professional
delivery company acknowledged worldwide if sent by mail; and (c) the receipt
date recorded on the transmission confirmation notice if sent by facsimile.

 

 6 

 

  

Party A: Recon Hengda Technology (Beijing) Co., Ltd.

Address: Room5771, Floor 5, Shenchang Building, Courtyard 51, Zhichun Road,
Haidian District, Beijing, China.

 

Party B: HUANG Baokun, SHI Jing, LI Suzhen.

Address: Courtyard 0467, Huancheng Road, Huatugou Town, Mangya District,
Qinghai, China.

 

Party C: Qinghai Huayou Underground Petroleum Technology Co., Ltd.

Address: Courtyard 0467, Huancheng Road, Huatugou Town, Mangya District,
Qinghai, China.

 

8.Confidentiality

 

8.1The Parties acknowledge and confirm that any oral or written information
relating to this Agreement communicated among the Parties shall be deemed as
confidential information (“Confidential Information”). The Parties shall keep
confidential of such Confidential Information and shall not disclose to any
third party unless having obtained prior written consent from the other parties.
Nevertheless, Confidential Information shall not include information which (a)
was at the date hereof or subsequently becomes public information (otherwise
than disclosed by any party received such Confidential Information); (b) is
disclosed in accordance with applicable laws or regulations; or (c) the party
who discloses any Confidential Information to its attorneys or financial
advisors who need to access such information shall ensure that such attorneys or
financial advisors comply with this provision and keep confidential such
information. The disclosure by the employee or agent of Each Party shall be
deemed as disclosed by the party itself, and the party shall be liable of the
breach. The Parties agree that the provisions of this Article shall survive
notwithstanding the termination of this Agreement.

 

9.Further Assurance

 

9.1The Parties agree that they will, without any hesitation, execute any
necessary documents for the performance of this Agreement or any documents which
are benefit for the purpose of this Agreement, and will take all necessary
actions for the purpose of this Agreement or take actions which are benefit for
the purpose of this Agreement.

 

 7 

 

 

10.Miscellaneous

 

10.1Amendment and supplementation

 

Any revision, amendment and supplementation of this Agreement shall be in
writing and be executed by Each Party.

 

10.2Compliance with laws and regulations

 

The Parties shall comply with all applicable PRC laws and regulations which have
been formally issued and may be publicly acquired.

 

10.3Entire agreement

 

Unless it is otherwise revised, amended or supplemented after execution of this
Agreement, this Agreement constitutes the entire agreement among the parties as
to the subject matter, and supersedes any prior oral or written negotiations,
statements or agreement among the parties relating thereto.

 

10.4Headings

 

Headings in this Agreement are only set out for reading convenience, and shall
not be used to interpret, explain or otherwise influence the meaning of the
provisions of this Agreement.

 

10.5Language

 

This Agreement is made in Chinese and English in three originals. The Chinese
version will prevail in the event of any inconsistency between the English and
any Chinese translations thereof.

 

10.6Severability

 

If any of the terms of this Agreement is declared invalid, illegal or
unenforceable in accordance with any applicable laws or regulations, the
validity and enforceability of the other terms hereof shall nevertheless remain
unaffected, and the Parties hereto agree to, through friendly negotiation, make
valid terms to such invalid, illegal or unenforceable terms, and the economic
results from such valid terms shall be close to, as much as may be possible, the
superseded invalid, illegal or enforceable terms.

 

10.7Successor

 

This Agreement shall bind the successor of each party or the transferee
permitted by the other parties and shall be interpreted for its benefit.

 

 8 

 

  

10.8Continue to be effective

 

10.8.1Any duties occurred in relation to the Agreement before expiration or
early termination of the Agreement shall continue to be effective after
expiration or early termination of the Agreement.

 

10.8.2Articles 5, 7, 8 and 10.8 hereof shall survive notwithstanding the
termination of this Agreement.

 

10.9Waiver

 

Each party may waive the terms and conditions under this Agreement in writing.
Such waiver should be duly signed by the other parties. Any waive relating to
the breach of the other party in certain circumstance shall not be deemed as
that the waiver party has made waiver to the other party for the same breach in
other circumstances.

 

[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]

 

 

 

 

 

 

 9 

 

  

This page is the signing page of this Exclusive Equity Interest Purchase
Agreement. IN WITNESS WHEREOF, the Parties have its authorized representative
executed this Agreement on the date first above written.

 

 

Party A: Recon Hengda Technology (Beijing) Co., Ltd.

 

 

Legal Representative: /s/ Chen Guangqiang

 

 

 

Party B:

 

HUANG Baokun

 

Signature: /s/ Huang Baokun

 

SHI Jing

 

Signature: /s/ Shi Jing

 

LI Suzhen

 

Signature: /s/ Li Suzhen

 

 

 

Party C: Qinghai Hua You Downhole Technology Co., Ltd.

 

 

Legal Representative: /s/ Haung Baokun

 

 10