Exhibit 10.1


 


EXECUTION COPY


 


SECURITIES
PURCHASE AGREEMENT


 


This SECURITIES
PURCHASE AGREEMENT (the “Agreement”), dated as of April 16, 2019, is by and among China SXT Pharmaceuticals,
Inc., a company organized under the laws of the British Virgin Islands with offices located at 178 Taidong Rd North, Taizhou, Jiangsu,
China (the “Company”), and each of the investors listed on the Schedule of Buyers attached hereto (individually,
a “Buyer” and collectively, the “Buyers”).


 


RECITALS


 


A. The
Company and each Buyer is executing and delivering this Agreement in reliance upon the exemption from securities registration afforded
by Section 4(a)(2) of the Securities Act of 1933, as amended (the “1933 Act”), and Rule 506(b) of Regulation
D (“Regulation D”) as promulgated by the United States Securities and Exchange Commission (the “SEC”)
under the 1933 Act.


 


B. The
Company has authorized two new series’ of convertible notes with an aggregate principal amount of $15,000,000 as follows:
(i) a new series of senior convertible notes of the Company, in the aggregate original principal amount of $10,000,000, substantially
in the form attached hereto as Exhibit A-1 (the “Series A Notes”), which Series A Notes shall
be convertible into Ordinary Shares (as defined below) (the Ordinary Shares issuable pursuant to the terms of the Series A Notes,
including, without limitation, upon conversion of any principal, interest, late charges or additional amount or otherwise thereunder,
collectively, the “Series A Conversion Shares”), in accordance with the terms of the Series A Notes; and (ii)
a new series of senior secured convertible notes of the Company, in the aggregate original principal amount of $5,000,000, substantially
in the form attached hereto as Exhibit A-2 (the “Series B Notes”, and together with the Series
A Notes, the “Notes”), which Series B Notes shall be convertible into Ordinary Shares (as defined below) (the
Ordinary Shares issuable pursuant to the terms of the Series B Notes, including, without limitation, upon conversion of any principal,
interest, late charges or additional amount or otherwise thereunder, collectively, the “Series B Conversion Shares”,
and together with the Series A Conversion Shares, the “Conversion Shares”), in accordance with the terms of
the Series B Notes.


 


C. Each
Buyer wishes to purchase, and the Company wishes to sell, upon the terms and conditions stated in this Agreement, (i) a Series
A Note in the aggregate original principal amount set forth opposite such Buyer’s name in column (3) on the Schedule of Buyers,
(ii) a Series B Note in the aggregate original principal amount set forth opposite such Buyer’s name in column (4) on the
Schedule of Buyers, and (iii) (x) a warrant to initially acquire up to that aggregate number of additional Ordinary Shares set
forth opposite such Buyer’s name in column (5) on the Schedule of Buyers, substantially in the form attached hereto as Exhibit
B-1 (the “Series A Warrants”) (as exercised, collectively, the “Series A Warrant Shares”)
and (y) a warrant to initially acquire up to that aggregate number of additional Ordinary Shares set forth opposite such Buyer’s
name in column (6) on the Schedule of Buyers, substantially in the form attached hereto as Exhibit B-2 (the “Series
B Warrants”, and together with the Series A Warrants, the “Warrants”) (as exercised, collectively,
the “Series A Warrant Shares”, and together with the Series B Warrant Shares, the “Warrant Shares”).


 






     


     


    

 


D. At
the Closing, the parties hereto shall execute and deliver a Registration Rights Agreement, in the form attached hereto as Exhibit
C (the “Registration Rights Agreement”), pursuant to which the Company has agreed to provide certain
registration rights with respect to the Registrable Securities (as defined in the Registration Rights Agreement), under the 1933
Act and the rules and regulations promulgated thereunder, and applicable state securities laws.


 


E. Concurrently
herewith the Company and each Buyer, separately, have entered into a Note Securities Purchase Agreement in the form attached hereto
as Exhibit D (each as amended, modified, supplemented, extended, renewed, restated or replaced from time to time,
collectively, the “Note Purchase Agreements”) pursuant to which the Company shall acquire a secured promissory
note issued by the applicable Buyer (each, an “Investor Note”, and collectively, the “Investor Notes”)
as payment of the Series B Purchase Price (as defined below) hereunder.


 


F. Concurrently
herewith, the Company and each Buyer, separately, are entering into that certain Master Netting Agreement, in substantially the
form attached hereto as Exhibit E (the “Master Netting Agreement”), to provide further clarification
of their rights (but not, in the case of each such Buyer only, its obligation) to Net (as defined below) certain Obligations (as
defined in the Master Netting Agreement) arising under and across this Agreement, the Investor Note, the Series B Notes and the
Note Purchase Agreement (collectively, the “Underlying Agreements”) and to treat the Master Netting Agreement,
this Agreement and the other Underlying Agreements as a single agreement for the purposes set forth herein and to treat this Agreement
and the Note Purchase Agreement each as a “securities contract” (11 U.S.C. § 741) or other similar agreements.


 


G. Except
as may be otherwise limited hereby, the Notes will rank senior to all outstanding and future indebtedness of the Company, and its
Subsidiaries (as defined below) the Notes will be secured by a first priority, perfected security interest in certain of the Ordinary
Shares held by Feng Zhou Management Limited, a British Virgin Islands company wholly owned by Feng Zhou with the address at Sertus
Chambers, PO Box 905, Quisticky Building Road Town, Tortola, British Virgin Islands (collectively, the “Principal Shareholder”),
as evidenced by the pledge agreement attached hereto as Exhibit F (the “Pledge Agreement”, and
together with any ancillary documents with respect thereto, collectively, the “Security Documents”)


 


H. The
Notes, the Conversion Shares, the Warrants and the Warrant Shares are collectively referred to herein as the “Securities.”


 


AGREEMENT


 


NOW, THEREFORE, in
consideration of the premises and the mutual covenants contained herein and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the Company and each Buyer hereby agree as follows:


 


1. PURCHASE
AND SALE OF NOTES AND WARRANTS.


 


(a) Purchase
of Notes and Warrants. Subject to the satisfaction (or waiver) of the conditions
set forth in Sections 6 and 7 below, the Company shall issue and sell to each Buyer, and each Buyer severally, but not jointly,
agrees to purchase from the Company on the Closing Date (as defined below) (a) a Series A Note in the original principal amount
as is set forth opposite such Buyer’s name in column (3) on the Schedule of Buyers, (b) a Series B Note in the aggregate
original principal amount as is set forth opposite such Buyer’s name in column (4) on the Schedule of Buyers, (c) Series
A Warrants to initially acquire up to that aggregate number of Series A Warrant Shares as is set forth opposite such Buyer’s
name in column (5) on the Schedule of Buyers and (d) Series B Warrants to initially acquire up to that aggregate number of Series
B Warrant Shares as is set forth opposite such Buyer’s name in column (6) on the Schedule of Buyers.


 






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(b) Closing.
The closing (the “Closing”) of the purchase of the Notes and the Warrants by the Buyers shall occur at the
offices of Kelley Drye & Warren LLP, 101 Park Avenue, New York, NY 10178. The date and time of the Closing (the “Closing
Date”) shall be 10:00 a.m., New York time, on the first (1st) Business Day on which the conditions to the Closing set
forth in Sections 6 and 7 below are satisfied or waived (or such other date as is mutually agreed to by the Company and each Buyer).
As used herein “Business Day” means any day other than a Saturday, Sunday or other day on which commercial
banks in New York, New York are authorized or required by law to remain closed.


 


(c) Purchase
Price. The aggregate purchase price for the Notes and Warrants to be purchased
by each Buyer (the “Purchase Price”) shall be the aggregate amount as set forth opposite such Buyer’s
name in column (7) on the Schedule of Buyers, consisting of (A) a payment in cash of such aggregate amount as set forth opposite
such Buyer’s name in column (8) on the Schedule of Buyers (the “Series A Cash Purchase Price”) (less,
in the case of any Buyer, the amounts withheld pursuant to Section 4(g)) to the Company for the Series A Notes and the Warrants
to be issued and sold to such Buyer at the Closing, by wire transfer of immediately available funds in accordance with the Flow
of Funds Letter (as defined below) and (B) the aggregate amount as set forth opposite such Buyer’s name in column (9) on
the Schedule of Buyers (the “Series B Purchase Price”) for the Series B Notes to be satisfied, in full, by
the issuance by such Buyer of an Investor Note pursuant to the Note Purchase Agreement in the aggregate original principal amount
equal to the Series B Purchase Price. In addition, at the Closing, an authorized person of such Buyer shall certify in a written
certificate in the form attached hereto as Exhibit G (the “Investor Collateral Certificate”)
that as of the Closing Date the bank account described on Schedule I to such Investor Note, which secures such Investor Note in
accordance therewith, contains at least the Series B Purchase Price of Eligible Assets (as defined in the Investor Note) as of
the Closing Date. For the avoidance of doubt, each Buyer shall pay (x) approximately $1,000 for each $1,000 of principal amount
of Series A Notes and related Warrants to be purchased by such Buyer at the Closing and (y) approximately $1,000 for each $1,000
of principal amount of Series B Notes to be purchased by such Buyer at the Closing. Each Buyer and the Company agree that the
Notes and the Warrants constitute an “investment unit” for purposes of Section 1273(c)(2) of the Internal Revenue
Code of 1986, as amended (the “Code”). The Buyers and the Company mutually agree that the allocation of the
issue price of such investment unit between the Notes and the Warrants in accordance with Section 1273(c)(2) of the Code and Treasury
Regulation Section 1.1273-2(h) shall be as mutually agreed by the Company and the Required Holders, and neither the Buyers nor
the Company shall take any position inconsistent with such allocation in any tax return or in any judicial or administrative proceeding
in respect of taxes.


 






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(d) Form of
Payment. On the Closing Date, (i) each Buyer shall (x) pay its respective Series
A Cash Purchase Price (less, in the case of any Buyer, the amounts withheld pursuant to Section 4(g)) to the Company for
the Series A Notes and the Warrants to be issued and sold to such Buyer at the Closing, by wire transfer of immediately available
funds in accordance with the Flow of Funds Letter (as defined below) and (y) in accordance with the instructions of the Company
in the Flow of Funds Letter, maintain physical possession of a duly executed Investor Note of such Buyer, in such original principal
amount as is set forth across from such Buyer’s name in column (9) of the Schedule of Buyers, issued pursuant to the Note
Purchase Agreement of such Buyer, both as payment for, and as Collateral (as defined in such Buyer’s Series B Note) securing,
such Buyer’s Series B Note to be issued and sold to such Buyer at the Closing and (ii) the Company shall deliver to
each Buyer (A) a Series A Note in the aggregate original principal amount as is set forth opposite such Buyer’s name in
column (3) of the Schedule of Buyers, and (B) a Series B Note in the aggregate original principal amount as is set forth opposite
such Buyer’s name in column (4) on the Schedule of Buyers, (C) a Series A Warrant pursuant to which such Buyer shall have
the right to initially acquire up to such aggregate number of Series A Warrant Shares as is set forth opposite such Buyer’s
name in column (5) of the Schedule of Buyers and (D) a Series B Warrant pursuant to which such Buyer shall have the right to initially
acquire up to such aggregate number of Series B Warrant Shares as is set forth opposite such Buyer’s name in column (6)
of the Schedule of Buyers, in each case, duly executed on behalf of the Company and registered in the name of such Buyer or its
designee..


 


(e) Securities
Contract; Netting Safe Harbor. The Company hereby acknowledges and agrees that the rights and obligations of each Buyer under
the Note Purchase Agreement of such Buyer, under the Investor Note of such Buyer, under the Series B Note to be issued hereunder
to such Buyer and the rights and obligations of the Company hereunder, under each such Investor Note, under each such Series B
Note and under each such Note Purchase Agreement, respectively, arise in a single integrated transaction and constitute related
and interdependent obligations within such transaction. The Company and each Buyer, severally, hereby acknowledge and agree that
this Agreement and the Note Purchase Agreement each are a “securities contract” as defined in 11 U.S.C. § 741
and that each such Buyer shall have all rights in respect of the Master Netting Agreement, this Agreement and the other Underlying
Agreements as are set forth in 11 U.S.C. § 555 and 11 U.S.C. § 362(b)(6), including, without limitation, all rights of
credit, deduction, setoff, offset, recoupment, and netting (each, a “Net”, and collectively, “Netting”)
as are available under the Master Netting Agreement, this Agreement and the other Underlying Agreements, and all Netting provisions
of the Master Netting Agreement, each Series B Note and each Investor Note, including without limitation the provisions set forth
in Section 7 of each Investor Note, are hereby incorporated in this Agreement and made a part hereof as if such provisions were
set forth herein.


 


2. BUYER’S
REPRESENTATIONS AND WARRANTIES.


 


Each Buyer, severally
and not jointly, represents and warrants to the Company with respect to only itself that, as of the date hereof and as of the Closing
Date:


 


(a) Organization;
Authority. Such Buyer is an entity duly organized, validly existing and in good standing under the laws of the jurisdiction
of its organization with the requisite power and authority to enter into and to consummate the transactions contemplated by the
Transaction Documents (as defined below) to which it is a party and otherwise to carry out its obligations hereunder and thereunder.


 






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(b) No Public
Sale or Distribution. Such Buyer (i) is acquiring its Note and Warrants, (ii) upon
conversion of its Note will acquire the Conversion Shares issuable upon conversion thereof, and (iii) upon exercise of its
Warrants (other than pursuant to a Cashless Exercise (as defined in the Warrants)) will acquire the Warrant Shares issuable upon
exercise thereof, in each case, for its own account and not with a view towards, or for resale in connection with, the public
sale or distribution thereof in violation of applicable securities laws, except pursuant to sales registered or exempted under
the 1933 Act; provided, however, by making the representations herein, such Buyer does not agree, or make any representation or
warranty, to hold any of the Securities for any minimum or other specific term and reserves the right to dispose of the Securities
at any time in accordance with or pursuant to a registration statement or an exemption from registration under the 1933 Act. Such
Buyer does not presently have any agreement or understanding, directly or indirectly, with any Person to distribute any of the
Securities in violation of applicable securities laws. For purposes of this Agreement, “Person” means an individual,
a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization, any other
entity and any Governmental Entity or any department or agency thereof


 


(c) Accredited
Investor Status. Such Buyer is an “accredited investor” as that term
is defined in Rule 501(a) of Regulation D.


 


(d) Reliance
on Exemptions. Such Buyer understands that the Securities are being offered and
sold to it in reliance on specific exemptions from the registration requirements of United States federal and state securities
laws and that the Company is relying in part upon the truth and accuracy of, and such Buyer’s compliance with, the representations,
warranties, agreements, acknowledgments and understandings of such Buyer set forth herein in order to determine the availability
of such exemptions and the eligibility of such Buyer to acquire the Securities.


 


(e) Information.
Such Buyer and its advisors, if any, have been furnished with all materials relating to the business, finances and operations
of the Company and materials relating to the offer and sale of the Securities that have been requested by such Buyer. Such Buyer
and its advisors, if any, have been afforded the opportunity to ask questions of the Company and receive answers from the Company
concerning the terms and conditions of the offering of the Notes and the merits and risks of investing in the Notes; and (ii)
access to information about the Company and its financial condition, results of operations, business, properties, management and
prospects sufficient to enable it to evaluate its investment and receive answers from the Company concerning the terms and conditions
of the offering of the Notes and the merits and risks of investing in the Notes; and (ii) access to information about the Company
and its financial condition, results of operations, business, properties, management and prospects sufficient to enable it to
evaluate its investment.. Neither such inquiries nor any other due diligence investigations conducted by such Buyer or its advisors,
if any, or its representatives shall modify, amend or affect such Buyer's right to rely on the Company's representations and warranties
contained herein. Such Buyer understands that its investment in the Securities involves a high degree of risk. Such Buyer has
sought such accounting, legal and tax advice as it has considered necessary to make an informed investment decision with respect
to its acquisition of the Securities. Such Buyer hereby acknowledges and agrees that it has independently evaluated the merits
of its decision to purchase the Securities, and that (i) the Placement Agent is acting solely as placement agent in connection
with the execution, delivery and performance of the Transaction Documents and is not acting as underwriter or in any other capacity
and is not and shall not be construed as a fiduciary for such Buyer, the Company or any other Person in connection with the execution,
delivery and performance of the Transaction Documents, and (ii) such Buyer has not relied on the Placement Agent or its officers,
directors, employees, attorneys or affiliates with respect to the negotiation, execution or performance of the Transaction Documents
or any representation or warranty made in, in connection with, or as an inducement to the Transaction Documents.


 






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(f) No Governmental
Review. Such Buyer understands that no United States federal or state agency or
any other government or governmental agency has passed on or made any recommendation or endorsement of the Securities or the fairness
or suitability of the investment in the Securities nor have such authorities passed upon or endorsed the merits of the offering
of the Securities.


 


(g) Transfer
or Resale. Such Buyer understands that except as provided in the Registration Rights
Agreement and Section 4(h) hereof: (i) the Securities have not been and are not being registered under the 1933 Act or any state
securities laws, and may not be offered for sale, sold, assigned or transferred unless (A) subsequently registered thereunder,
(B) such Buyer shall have delivered to the Company (if requested by the Company) an opinion of counsel, in a form reasonably acceptable
to the Company, to the effect that such Securities to be sold, assigned or transferred may be sold, assigned or transferred pursuant
to an exemption from such registration, or (C) such Buyer provides the Company with reasonable assurance that such Securities
can be sold, assigned or transferred pursuant to Rule 144 or Rule 144A promulgated under the 1933 Act (or a successor rule thereto)
(collectively, “Rule 144”); (ii) any sale of the Securities made in reliance on Rule 144 may be made only in
accordance with the terms of Rule 144, and further, if Rule 144 is not applicable, any resale of the Securities under circumstances
in which the seller (or the Person through whom the sale is made) may be deemed to be an underwriter (as that term is defined
in the 1933 Act) may require compliance with some other exemption under the 1933 Act or the rules and regulations of the SEC promulgated
thereunder; and (iii) neither the Company nor any other Person is under any obligation to register the Securities under the 1933
Act or any state securities laws or to comply with the terms and conditions of any exemption thereunder. Notwithstanding the foregoing,
the Securities may be pledged in connection with a bona fide margin account or other loan or financing arrangement secured by
the Securities and such pledge of Securities shall not be deemed to be a transfer, sale or assignment of the Securities hereunder,
and no Buyer effecting a pledge of Securities shall be required to provide the Company with any notice thereof or otherwise make
any delivery to the Company pursuant to this Agreement or any other Transaction Document (as defined in Section 3(b)), including,
without limitation, this Section 2(g).


 


(h) Validity;
Enforcement. This Agreement and the Registration Rights Agreement have been duly
and validly authorized, executed and delivered on behalf of such Buyer and shall constitute the legal, valid and binding obligations
of such Buyer enforceable against such Buyer in accordance with their respective terms, except as such enforceability may be limited
by general principles of equity or to applicable bankruptcy, insolvency, reorganization, moratorium, liquidation and other similar
laws relating to, or affecting generally, the enforcement of applicable creditors’ rights and remedies.


 






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(i) No Conflicts.
The execution, delivery and performance by such Buyer of this Agreement and the Registration Rights Agreement and the consummation
by such Buyer of the transactions contemplated hereby and thereby will not (i) result in a violation of the organizational documents
of such Buyer, or (ii) conflict with, or constitute a default (or an event which with notice or lapse of time or both would become
a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture
or instrument to which such Buyer is a party, or (iii) result in a violation of any law, rule, regulation, order, judgment or
decree (including federal and state securities laws) applicable to such Buyer, except in the case of clauses (ii) and (iii) above,
for such conflicts, defaults, rights or violations which could not, individually or in the aggregate, reasonably be expected to
have a material adverse effect on the ability of such Buyer to perform its obligations hereunder.


 


(j) Certain
Trading Activities. Such Buyer has not directly or indirectly, nor has any Person acting on behalf of or pursuant to any understanding
with such Buyer, engaged in any purchases and sales in the securities of the Company (including, without limitation, any Short
Sales (as defined below) involving the Company’s securities) during the period commencing as of the time that such Buyer
was first contacted by the Placement Agent (as defined below) regarding the specific investment in the Company contemplated by
this Agreement and ending immediately prior to the execution of this Agreement by such Buyer. “Short Sales” means all
“short sales” as defined in Rule 200 promulgated under Regulation SHO under the 1934 Act (as defined below) (but shall
not be deemed to include the location and/or reservation of borrowable Common Shares). Such Buyer is aware that Short Sales and
other hedging activities may be subject to applicable federal and state securities laws, rules and regulations and such Buyer acknowledges
that the responsibility of compliance with any such federal or state securities laws, rules and regulations is solely the responsibility
of such Buyer.


 


3. REPRESENTATIONS
AND WARRANTIES OF THE COMPANY.


 


The Company represents
and warrants to each of the Buyers that, as of the date hereof and as of the Closing Date:


 


(a) Organization
and Qualification. Each of the Company and each of its Subsidiaries are entities
duly organized and validly existing and in good standing under the laws of the jurisdiction in which they are formed, and have
the requisite power and authority to own their properties and to carry on their business as now being conducted and as presently
proposed to be conducted. Each of the Company and each of its Subsidiaries is duly qualified as a foreign entity to do business
and is in good standing in every jurisdiction in which its ownership of property or the nature of the business conducted by it
makes such qualification necessary, except to the extent that the failure to be so qualified or be in good standing would not
reasonably be expected to have a Material Adverse Effect (as defined below). As used in this Agreement, “Material Adverse
Effect” means any material adverse effect on (i) the business, properties, assets, liabilities, operations (including
results thereof), condition (financial or otherwise) or prospects of the Company or any Subsidiary, individually or taken as a
whole, (ii) the transactions contemplated hereby or in any of the other Transaction Documents or any other agreements or instruments
to be entered into in connection herewith or therewith or (iii) the authority or ability of the Company or any of its Subsidiaries
to perform any of their respective obligations under any of the Transaction Documents (as defined below). Other than the Persons
(as defined below) set forth on Schedule 3(a), the Company has no Subsidiaries. “Subsidiaries” means any
Person in which the Company, directly or indirectly, (I) owns any of the outstanding share capital or holds any equity or similar
interest of such Person or (II) controls or operates all or any part of the business, operations or administration of such Person,
and each of the foregoing, is individually referred to herein as a “Subsidiary.”


 






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(b) Authorization;
Enforcement; Validity. The Company has the requisite power and authority to enter
into and perform its obligations under this Agreement and the other Transaction Documents and to issue the Securities in accordance
with the terms hereof and thereof. Each Subsidiary has the requisite power and authority to enter into and perform its obligations
under the Transaction Documents to which it is a party. The execution and delivery of this Agreement and the other Transaction
Documents by the Company and its Subsidiaries, and the consummation by the Company and its Subsidiaries of the transactions contemplated
hereby and thereby (including, without limitation, the issuance of the Notes and the reservation for issuance and issuance of
the Conversion Shares issuable upon conversion of the Notes and the issuance of the Warrants and the reservation for issuance
and issuance of the Warrant Shares issuable upon exercise of the Warrants) have been duly authorized by the Company’s board
of directors and each of its Subsidiaries’ board of directors or other governing body, as applicable, and (other than the
filing with the SEC of one or more Registration Statements in accordance with the requirements of the Registration Rights Agreement,
a Form D with the SEC and any other filings as may be required by any state securities agencies) no further filing, consent or
authorization is required by the Company, its Subsidiaries, their respective boards of directors or their shareholders or other
governing body. This Agreement has been, and the other Transaction Documents to which it is a party will be prior to the Closing,
duly executed and delivered by the Company, and each constitutes the legal, valid and binding obligations of the Company, enforceable
against the Company in accordance with its respective terms, except as such enforceability may be limited by general principles
of equity or applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or similar laws relating to, or affecting
generally, the enforcement of applicable creditors’ rights and remedies and except as rights to indemnification and to contribution
may be limited by federal or state securities law. Prior to the Closing, the Transaction Documents to which each Subsidiary is
a party will be duly executed and delivered by each such Subsidiary, and shall constitute the legal, valid and binding obligations
of each such Subsidiary, enforceable against each such Subsidiary in accordance with their respective terms, except as such enforceability
may be limited by general principles of equity or applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or
similar laws relating to, or affecting generally, the enforcement of applicable creditors’ rights and remedies and except
as rights to indemnification and to contribution may be limited by federal or state securities law. “Transaction Documents”
means, collectively, this Agreement, the Notes, the Warrants, the Note Purchase Agreements, the Master Netting Agreement, the
Registration Rights Agreement, the Investor Note, the Pledge Agreement, the Security Documents, the Irrevocable Transfer Agent
Instructions (as defined below) and each of the other agreements and instruments entered into or delivered by any of the parties
hereto in connection with the transactions contemplated hereby and thereby, as may be amended from time to time.


 






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(c) Issuance
of Securities. The issuance of the Notes and the Warrants are duly authorized and upon issuance in accordance with the terms
of the Transaction Documents shall be validly issued, fully paid and non-assessable and free from all preemptive or similar rights,
mortgages, defects, claims, liens, pledges, charges, taxes, rights of first refusal, encumbrances, security interests and other
encumbrances (collectively “Liens”) with respect to the issuance thereof. As of the Closing, the Company shall
have reserved from its duly authorized share capital not less than 200% of the sum of (i) the maximum number of Conversion Shares
issuable upon conversion of the Notes (assuming for purposes hereof that (x) the Notes are convertible at the Alternate Conversion
Price (as defined in the Notes) assuming an Alternate Conversion Date (as defined in the Note) as of the date hereof, (y) interest
on the Notes shall accrue through October 2, 2020 and will be converted in Ordinary Shares at a conversion price equal to the Alternate
Conversion Price assuming an Alternate Conversion Date as of the date hereof and (z) any such conversion shall not take into account
any limitations on the conversion of the Notes set forth in the Notes), and (ii) the maximum number of Warrant Shares initially
issuable upon exercise of the Warrants (without taking into account any limitations on the exercise of the Warrants set forth therein).
Upon issuance or conversion in accordance with the Notes or exercise in accordance with the Warrants (as the case may be), the
Conversion Shares and the Warrant Shares, respectively, when issued, will be validly issued, fully paid and nonassessable and free
from all preemptive or similar rights or Liens with respect to the issue thereof, with the holders being entitled to all rights
accorded to a holder of Ordinary Shares. Subject to the accuracy of the representations and warranties of the Buyers in this Agreement,
the offer and issuance by the Company of the Securities is exempt from registration under the 1933 Act.


 


(d) No Conflicts.
The execution, delivery and performance of the Transaction Documents by the Company and its Subsidiaries and the consummation
by the Company and its Subsidiaries of the transactions contemplated hereby and thereby (including, without limitation, the issuance
of the Notes, the Warrants, the Conversion Shares and the Warrant Shares and the reservation for issuance of the Conversion Shares
and the Warrant Shares) will not (i) result in a violation of the Articles of Association (as defined below) (including, without
limitation, any certificate of designation contained therein), By-Laws (as defined below), certificate of formation, memorandum
of association, articles of association, bylaws or other organizational documents of the Company or any of its Subsidiaries, or
any share capital or other securities of the Company or any of its Subsidiaries, (ii) conflict with, or constitute a default (or
an event which with notice or lapse of time or both would become a default) in any respect under, or give to others any rights
of termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument to which the Company or any
of its Subsidiaries is a party, or (iii) result in a violation of any law, rule, regulation, order, judgment or decree (including,
without limitation, foreign, federal and state securities laws and regulations and the rules and regulations of the Nasdaq Capital
Market (the “Principal Market”) and including all applicable foreign, federal and state laws, rules and regulations,
including, without limitation, the laws, rules and regulations of British Virgin Islands and People’s Republic of China)
applicable to the Company or any of its Subsidiaries or by which any property or asset of the Company or any of its Subsidiaries
is bound or affected.


 






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(e) Consents.
Neither the Company nor any Subsidiary is required to obtain any consent from, authorization or order of, or make any filing or
registration with (other than the filing with the SEC of one or more Registration Statements in accordance with the requirements
of the Registration Rights Agreement, a Form D with the SEC and any other filings as may be required by any state securities agencies),
any Governmental Entity (as defined below) or any regulatory or self-regulatory agency or any other Person in order for it to
execute, deliver or perform any of its respective obligations under or contemplated by the Transaction Documents, in each case,
in accordance with the terms hereof or thereof. All consents, authorizations, orders, filings and registrations which the Company
or any Subsidiary is required to obtain pursuant to the preceding sentence have been or will be obtained or effected on or prior
to the Closing Date, and neither the Company nor any of its Subsidiaries are aware of any facts or circumstances which might prevent
the Company or any of its Subsidiaries from obtaining or effecting any of the registration, application or filings contemplated
by the Transaction Documents. The Company is not in violation of the requirements of the Principal Market and has no knowledge
of any facts or circumstances which could reasonably lead to delisting or suspension of the Ordinary Shares in the foreseeable
future. “Governmental Entity” means any nation, state, county, city, town, village, district, or other political
jurisdiction of any nature, federal, state, local, municipal, foreign, or other government, governmental or quasi-governmental
authority of any nature (including any governmental agency, branch, department, official, or entity and any court or other tribunal),
multi-national organization or body; or body exercising, or entitled to exercise, any administrative, executive, judicial, legislative,
police, regulatory, or taxing authority or power of any nature or instrumentality of any of the foregoing, including any entity
or enterprise owned or controlled by a government or a public international organization or any of the foregoing.


 


(f) Acknowledgment
Regarding Buyer’s Purchase of Securities. The Company acknowledges and agrees
that each Buyer is acting solely in the capacity of an arm’s length purchaser with respect to the Transaction Documents
and the transactions contemplated hereby and thereby and that no Buyer is (i) an officer or director of the Company or any of
its Subsidiaries, (ii) an “affiliate” (as defined in Rule 144) of the Company or any of its Subsidiaries or (iii)
to its knowledge, a “beneficial owner” of more than 10% of the Ordinary Shares (as defined for purposes of Rule 13d-3
of the Securities Exchange Act of 1934, as amended (the “1934 Act”)). The Company further acknowledges that
no Buyer is acting as a financial advisor or fiduciary of the Company or any of its Subsidiaries (or in any similar capacity)
with respect to the Transaction Documents and the transactions contemplated hereby and thereby, and any advice given by a Buyer
or any of its representatives or agents in connection with the Transaction Documents and the transactions contemplated hereby
and thereby is merely incidental to such Buyer’s purchase of the Securities. The Company further represents to each Buyer
that the Company’s and each Subsidiary’s decision to enter into the Transaction Documents to which it is a party has
been based solely on the independent evaluation by the Company, each Subsidiary and their respective representatives.


 


(g) No General
Solicitation; Placement Agent’s Fees. Neither the Company, nor any of its
Subsidiaries or affiliates, nor any Person acting on its or their behalf, has engaged in any form of general solicitation or general
advertising (within the meaning of Regulation D) in connection with the offer or sale of the Securities. The Company shall be
responsible for the payment of any placement agent’s fees, financial advisory fees, or brokers’ commissions (other
than for Persons engaged by any Buyer or its investment advisor) relating to or arising out of the transactions contemplated hereby,
including, without limitation, placement agent fees payable to FT Global Capital, Inc., as placement agent (the “Placement
Agent”) in connection with the sale of the Securities. The fees and expenses of the Placement Agent to be paid by the
Company or any of its Subsidiaries are as set forth on Schedule 3(g) attached hereto. The Company shall pay, and hold each Buyer
harmless against, any liability, loss or expense (including, without limitation, attorney's fees and out-of-pocket expenses) arising
in connection with any such claim. The Company acknowledges that it has engaged the Placement Agent in connection with the sale
of the Securities. Other than the Placement Agent, neither the Company nor any of its Subsidiaries has engaged any placement agent
or other agent in connection with the offer or sale of the Securities.


 






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(h) No Integrated
Offering. None of the Company, its Subsidiaries or any of their affiliates, nor
any Person acting on their behalf has, directly or indirectly, made any offers or sales of any security or solicited any offers
to buy any security, under circumstances that would require registration of the issuance of any of the Securities under the 1933
Act, whether through integration with prior offerings or otherwise, or cause this offering of the Securities to require approval
of shareholders of the Company for purposes of the 1933 Act or under any applicable shareholder approval provisions, including,
without limitation, under the rules and regulations of any exchange or automated quotation system on which any of the securities
of the Company are listed or designated for quotation. None of the Company, its Subsidiaries, their affiliates nor any Person
acting on their behalf will take any action or steps that would require registration of the issuance of any of the Securities
under the 1933 Act or cause the offering of any of the Securities to be integrated with other offerings of securities of the Company.


 


(i) Dilutive
Effect. The Company understands and acknowledges that the number of Conversion
Shares and Warrant Shares will increase in certain circumstances. The Company further acknowledges that its obligation to issue
the Conversion Shares pursuant to the terms of the Notes in accordance with this Agreement and the Notes and the Warrant Shares
upon exercise of the Warrants in accordance with this Agreement, the Notes and the Warrants is, in each case, absolute and unconditional
regardless of the dilutive effect that such issuance may have on the ownership interests of other shareholders of the Company.


 


(j) Application
of Takeover Protections; Rights Agreement. The Company and its board of directors
have taken all necessary action, if any, in order to render inapplicable any control share acquisition, interested shareholder,
business combination, poison pill (including, without limitation, any distribution under a rights agreement), shareholder rights
plan or other similar anti-takeover provision under the Articles of Association, Memorandum of Association or other organizational
documents or the laws of the jurisdiction of its incorporation or otherwise which is or could become applicable to any Buyer as
a result of the transactions contemplated by this Agreement, including, without limitation, the Company’s issuance of the
Securities and any Buyer’s ownership of the Securities. The Company and its board of directors have taken all necessary
action, if any, in order to render inapplicable any shareholder rights plan or similar arrangement relating to accumulations of
beneficial ownership of Ordinary Shares or a change in control of the Company or any of its Subsidiaries.


 






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(k) SEC Documents;
Financial Statements. Since the Company became subject to the reporting requirements
of 1934 Act to the date hereof, the Company has timely filed all reports, schedules, forms, proxy statements, statements and other
documents required to be filed by it with the SEC pursuant to the reporting requirements of the 1934 Act (all of the foregoing
filed prior to the date hereof and all exhibits and appendices included therein and financial statements, notes and schedules
thereto and documents incorporated by reference therein being hereinafter referred to as the “SEC Documents”).
The Company has delivered or has made available to the Buyers or their respective representatives true, correct and complete copies
of each of the SEC Documents not available on the EDGAR system. As of their respective dates, the SEC Documents complied in all
material respects with the requirements of the 1934 Act and the rules and regulations of the SEC promulgated thereunder applicable
to the SEC Documents, and none of the SEC Documents, at the time they were filed with the SEC, contained any untrue statement
of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not misleading. As of their respective dates, the financial
statements of the Company included in the SEC Documents complied in all material respects with applicable accounting requirements
and the published rules and regulations of the SEC with respect thereto as in effect as of the time of filing. Such financial
statements have been prepared in accordance with generally accepted accounting principles (“GAAP”), consistently
applied, during the periods involved (except (i) as may be otherwise indicated in such financial statements or the notes thereto,
or (ii) in the case of unaudited interim statements, to the extent they may exclude footnotes or may be condensed or summary statements)
and fairly present in all material respects the financial position of the Company as of the dates thereof and the results of its
operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal year-end audit adjustments
which will not be material, either individually or in the aggregate). The reserves, if any, established by the Company or the
lack of reserves, if applicable, are reasonable based upon facts and circumstances known by the Company on the date hereof and
there are no loss contingencies that are required to be accrued by the Statement of Financial Accounting Standard No. 5 of the
Financial Accounting Standards Board which are not provided for by the Company in its financial statements or otherwise. No other
information provided by or on behalf of the Company to any of the Buyers which is not included in the SEC Documents (including,
without limitation, information referred to in Section 2(e) of this Agreement or in the disclosure schedules to this Agreement)
contains any untrue statement of a material fact or omits to state any material fact necessary in order to make the statements
therein not misleading, in the light of the circumstance under which they are or were made. The Company is not currently contemplating
to amend or restate any of the financial statements (including, without limitation, any notes or any letter of the independent
accountants of the Company with respect thereto) included in the SEC Documents (the “Financial Statements”),
nor is the Company currently aware of facts or circumstances which would require the Company to amend or restate any of the Financial
Statements, in each case, in order for any of the Financials Statements to be in compliance with GAAP and the rules and regulations
of the SEC. The Company has not been informed by its independent accountants that they recommend that the Company amend or restate
any of the Financial Statements or that there is any need for the Company to amend or restate any of the Financial Statements.


 






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(l) Absence
of Certain Changes. Since the date of the Company’s most recent audited financial
statements contained in a the final prospectus and its supplement on Form 424B filed on October 3, 2018 (“Final Prospectus”),
there has been no material adverse change and no material adverse development in the business, assets, liabilities, properties,
operations (including results thereof), condition (financial or otherwise) or prospects of the Company or any of its Subsidiaries.
Since the date of the Company’s most recent audited financial statements contained in the Final Prospectus, neither the
Company nor any of its Subsidiaries has (i) declared or paid any dividends, (ii) Except as disclosed otherwise in the SEC Documents
sold any assets, individually or in the aggregate, outside of the ordinary course of business or (iii) made any capital expenditures,
individually or in the aggregate, outside of the ordinary course of business. Neither the Company nor any of its Subsidiaries
has taken any steps to seek protection pursuant to any law or statute relating to bankruptcy, insolvency, reorganization, receivership,
liquidation or winding up, nor does the Company or any Subsidiary have any knowledge or reason to believe that any of their respective
creditors intend to initiate involuntary bankruptcy proceedings or any actual knowledge of any fact which would reasonably lead
a creditor to do so. The Company and its Subsidiaries, individually and on a consolidated basis, are not as of the date hereof,
and after giving effect to the transactions contemplated hereby to occur at the Closing, will not be Insolvent (as defined below).
For purposes of this Section 3(l), “Insolvent” means, (i) with respect to the Company and its Subsidiaries,
on a consolidated basis, (A) the present fair saleable value of the Company’s and its Subsidiaries’ assets is less
than the amount required to pay the Company’s and its Subsidiaries’ total Indebtedness (as defined below), (B) the
Company and its Subsidiaries are unable to pay their debts and liabilities, subordinated, contingent or otherwise, as such debts
and liabilities become absolute and matured or (C) the Company and its Subsidiaries intend to incur or believe that they will
incur debts that would be beyond their ability to pay as such debts mature; and (ii) with respect to the Company and each Subsidiary,
individually, (A) the present fair saleable value of the Company’s or such Subsidiary’s (as the case may be) assets
is less than the amount required to pay its respective total Indebtedness, (B) the Company or such Subsidiary (as the case may
be) is unable to pay its respective debts and liabilities, subordinated, contingent or otherwise, as such debts and liabilities
become absolute and matured or (C) the Company or such Subsidiary (as the case may be) intends to incur or believes that it will
incur debts that would be beyond its respective ability to pay as such debts mature. Neither the Company nor any of its Subsidiaries
has engaged in any business or in any transaction, and is not about to engage in any business or in any transaction, for which
the Company’s or such Subsidiary’s remaining assets constitute unreasonably small capital with which to conduct the
business in which it is engaged as such business is now conducted and is proposed to be conducted.


 


(m) No Undisclosed
Events, Liabilities, Developments or Circumstances. No event, liability, development
or circumstance has occurred or exists, or is reasonably expected to exist or occur with respect to the Company, any of its Subsidiaries
or any of their respective businesses, properties, liabilities, prospects, operations (including results thereof) or condition
(financial or otherwise), that (i) would be required to be disclosed by the Company under applicable securities laws on a registration
statement on Form F-1 filed with the SEC relating to an issuance and sale by the Company of its Ordinary Shares and which has
not been publicly announced, (ii) could have a material adverse effect on any Buyer’s investment hereunder or (iii) could
have a Material Adverse Effect.


 






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(n) Conduct
of Business; Regulatory Permits. Neither the Company nor any of its Subsidiaries
is in violation of any term of or in default under its Articles of Association, any certificate of designation, preferences or
rights of any other outstanding series of preferred shares of the Company or any of its Subsidiaries or Memorandum of Association
or their organizational charter, certificate of formation, memorandum of association, articles of association, Articles of Association
or certificate of incorporation or bylaws, respectively. Neither the Company nor any of its Subsidiaries is in violation of any
judgment, decree or order or any statute, ordinance, rule or regulation applicable to the Company or any of its Subsidiaries,
and neither the Company nor any of its Subsidiaries will conduct its business in violation of any of the foregoing, except in
all cases for possible violations which could not, individually or in the aggregate, have a Material Adverse Effect. Without limiting
the generality of the foregoing, the Company is not in violation of any of the rules, regulations or requirements of the Principal
Market and has no knowledge of any facts or circumstances that could reasonably lead to delisting or suspension of the Ordinary
Shares by the Principal Market in the foreseeable future. Since January 4, 2019, (i) the Ordinary Shares has been listed or designated
for quotation on the Principal Market, (ii) trading in the Ordinary Shares has not been suspended by the SEC or the Principal
Market and (iii) the Company has received no communication, written or oral, from the SEC or the Principal Market regarding the
suspension or delisting of the Ordinary Shares from the Principal Market. Except as disclosed in the SEC Documents, the Company
and each of its Subsidiaries possess all certificates, authorizations and permits issued by the appropriate regulatory authorities
necessary to conduct their respective businesses, except where the failure to possess such certificates, authorizations or permits
would not have, individually or in the aggregate, a Material Adverse Effect, and neither the Company nor any such Subsidiary has
received any notice of proceedings relating to the revocation or modification of any such certificate, authorization or permit.
Except as disclosed in the SEC Documents, there is no agreement, commitment, judgment, injunction, order or decree binding upon
the Company or any of its Subsidiaries or to which the Company or any of its Subsidiaries is a party which has or would reasonably
be expected to have the effect of prohibiting or materially impairing any business practice of the Company or any of its Subsidiaries,
any acquisition of property by the Company or any of its Subsidiaries or the conduct of business by the Company or any of its
Subsidiaries as currently conducted other than such effects, individually or in the aggregate, which have not had and would not
reasonably be expected to have a Material Adverse Effect on the Company or any of its Subsidiaries.


 


(o) Foreign
Corrupt Practices. Neither the Company, the Company’s subsidiary or any director,
officer, agent, employee, nor any other person acting for or on behalf of the foregoing (individually and collectively, a “Company
Affiliate”) have violated the U.S. Foreign Corrupt Practices Act (the “FCPA”) or any other applicable
anti-bribery or anti-corruption laws, nor has any Company Affiliate offered, paid, promised to pay, or authorized the payment
of any money, or offered, given, promised to give, or authorized the giving of anything of value, to any officer, employee or
any other person acting in an official capacity for any Governmental Entity to any political party or official thereof or to any
candidate for political office (individually and collectively, a “Government Official”) or to any person under
circumstances where such Company Affiliate knew or was aware of a high probability that all or a portion of such money or thing
of value would be offered, given or promised, directly or indirectly, to any Government Official, for the purpose of:


 


(i) (A)
influencing any act or decision of such Government Official in his/her official capacity, (B) inducing such Government Official
to do or omit to do any act in violation of his/her lawful duty, (C) securing any improper advantage, or (D) inducing such Government
Official to influence or affect any act or decision of any Governmental Entity, or


 


(ii) assisting
the Company or its Subsidiaries in obtaining or retaining business for or with, or directing business to, the Company or its Subsidiaries.


 






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(p) Sarbanes-Oxley
Act. The Company and each Subsidiary is in compliance with any and all applicable
requirements of the Sarbanes-Oxley Act of 2002, as amended, and any and all applicable rules and regulations promulgated by the
SEC thereunder.


 


(q) Transactions
With Affiliates. Except as disclosed in the SEC Documents, no current or former
employee, partner, director, officer or shareholder (direct or indirect) of the Company or its Subsidiaries, or any associate,
or, to the knowledge of the Company, any affiliate of any thereof, or any relative with a relationship no more remote than first
cousin of any of the foregoing, is presently, or has ever been, (i) a party to any transaction with the Company or its Subsidiaries
(including any contract, agreement or other arrangement providing for the furnishing of services by, or rental of real or personal
property from, or otherwise requiring payments to, any such director, officer or shareholder or such associate or affiliate or
relative Subsidiaries (other than for ordinary course services as employees, officers or directors of the Company or any of its
Subsidiaries)) or (ii) the direct or indirect owner of an interest in any corporation, firm, association or business organization
which is a competitor, supplier or customer of the Company or its Subsidiaries (except for a passive investment (direct or indirect)
in less than 5% of the common equity of a company whose securities are traded on or quoted through an Eligible Market (as defined
in the Notes)), nor does any such Person receive income from any source other than the Company or its Subsidiaries which relates
to the business of the Company or its Subsidiaries or should properly accrue to the Company or its Subsidiaries. No employee,
officer, shareholder or director of the Company or any of its Subsidiaries or member of his or her immediate family is indebted
to the Company or its Subsidiaries, as the case may be, nor is the Company or any of its Subsidiaries indebted (or committed to
make loans or extend or guarantee credit) to any of them, other than (i) for payment of salary for services rendered, (ii) reimbursement
for reasonable expenses incurred on behalf of the Company, and (iii) for other standard employee benefits made generally available
to all employees or executives (including share option agreements outstanding under any share option plan approved by the Board
of Directors of the Company).


 


(r) Equity
Capitalization. 


 


(i) Definitions:
“Ordinary Shares” means (x) the Company’s ordinary shares, $0.001 par value per share, and (y) any
share capital into which such ordinary shares shall have been changed or any share capital resulting from a reclassification of
such ordinary shares.


 


(ii) Authorized
and Outstanding Share Capital. As of the date hereof, the authorized share capital of the Company consists of unlimited amount
of Ordinary Shares, of which, 22,706,701 are issued and outstanding and 3,579,952 shares are reserved for issuance pursuant to
Convertible Securities (as defined below) (other than the Notes and the Warrants) exercisable or exchangeable for, or convertible
into, Ordinary Shares.


 


(iii) Valid
Issuance; Available Shares; Affiliates. All of such outstanding shares are duly authorized and have been, or upon issuance
will be, validly issued and are fully paid and nonassessable. Schedule 3(r)(iii) sets forth the number of Ordinary Shares
that are (A) reserved for issuance pursuant to Convertible Securities (as defined below) (other than the Notes and the Warrants)
and (B) that are, as of the date hereof, owned by Persons who are “affiliates” (as defined in Rule 405 of the 1933
Act and calculated based on the assumption that only officers, directors and holders of at least 10% of the Company’s issued
and outstanding Ordinary Shares are “affiliates” without conceding that any such Persons are “affiliates”
for purposes of federal securities laws) of the Company or any of its Subsidiaries. To the Company’s knowledge, no Person
owns 10% or more of the Company’s issued and outstanding Ordinary Shares (calculated based on the assumption that all Convertible
Securities (as defined below), whether or not presently exercisable or convertible, have been fully exercised or converted (as
the case may be) taking account of any limitations on exercise or conversion (including “blockers”) contained therein
without conceding that such identified Person is a 10% shareholder for purposes of federal securities laws).


 






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(iv) Existing
Securities; Obligations. Except as disclosed in the SEC Documents: (A) none of the Company’s or any Subsidiary’s
shares, interests or share capital is subject to preemptive rights or any other similar rights or Liens suffered or permitted by
the Company or any Subsidiary; (B) there are no outstanding options, warrants, scrip, rights to subscribe to, calls or commitments
of any character whatsoever relating to, or securities or rights convertible into, or exercisable or exchangeable for, any shares,
interests or share capital of the Company or any of its Subsidiaries, or contracts, commitments, understandings or arrangements
by which the Company or any of its Subsidiaries is or may become bound to issue additional shares, interests or share capital of
the Company or any of its Subsidiaries or options, warrants, scrip, rights to subscribe to, calls or commitments of any character
whatsoever relating to, or securities or rights convertible into, or exercisable or exchangeable for, any shares, interests or
share capital of the Company or any of its Subsidiaries; (C) there are no agreements or arrangements under which the Company or
any of its Subsidiaries is obligated to register the sale of any of their securities under the 1933 Act (except pursuant to the
Registration Rights Agreement); (D) there are no outstanding securities or instruments of the Company or any of its Subsidiaries
which contain any redemption or similar provisions, and there are no contracts, commitments, understandings or arrangements by
which the Company or any of its Subsidiaries is or may become bound to redeem a security of the Company or any of its Subsidiaries;
(E) there are no securities or instruments containing anti-dilution or similar provisions that will be triggered by the issuance
of the Securities; and (F) neither the Company nor any Subsidiary has any share appreciation rights or “phantom share”
plans or agreements or any similar plan or agreement.


 


(v) Organizational
Documents. The Company has furnished to the Buyers true, correct and complete copies of the Company’s articles of association,
as amended and as in effect on the date hereof (the “Articles of Association”), and the Company’s memorandum
of association, as amended and as in effect on the date hereof (the “Memorandum of Association”), and the terms
of all Convertible Securities and the material rights of the holders thereof in respect thereto.


 






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(s) Indebtedness
and Other Contracts. Neither the Company nor any of its Subsidiaries, (i) except
as disclosed on Schedule 3(r), has any outstanding debt securities, notes, credit agreements, credit facilities or
other agreements, documents or instruments evidencing Indebtedness of the Company or any of its Subsidiaries or by which the Company
or any of its Subsidiaries is or may become bound, (ii) is a party to any contract, agreement or instrument, the violation of
which, or default under which, by the other party(ies) to such contract, agreement or instrument could reasonably be expected
to result in a Material Adverse Effect, (iii) has any financing statements securing obligations in any amounts filed in connection
with the Company or any of its Subsidiaries; (iv) is in violation of any term of, or in default under, any contract, agreement
or instrument relating to any Indebtedness, except where such violations and defaults would not result, individually or in the
aggregate, in a Material Adverse Effect, or (v) is a party to any contract, agreement or instrument relating to any Indebtedness,
the performance of which, in the judgment of the Company’s officers, has or is expected to have a Material Adverse Effect.
Neither the Company nor any of its Subsidiaries have any liabilities or obligations required to be disclosed in the SEC Documents
which are not so disclosed in the SEC Documents, other than those incurred in the ordinary course of the Company’s or its
Subsidiaries’ respective businesses and which, individually or in the aggregate, do not or could not have a Material Adverse
Effect. For purposes of this Agreement: (x) “Indebtedness” of any Person means, without duplication (A) all
indebtedness for borrowed money, (B) all obligations issued, undertaken or assumed as the deferred purchase price of property
or services (including, without limitation, “capital leases” in accordance with GAAP) (other than trade payables entered
into in the ordinary course of business consistent with past practice), (C) all reimbursement or payment obligations with respect
to letters of credit, surety bonds and other similar instruments, (D) all obligations evidenced by notes, bonds, debentures or
similar instruments, including obligations so evidenced incurred in connection with the acquisition of property, assets or businesses,
(E) all indebtedness created or arising under any conditional sale or other title retention agreement, or incurred as financing,
in either case with respect to any property or assets acquired with the proceeds of such indebtedness (even though the rights
and remedies of the seller or bank under such agreement in the event of default are limited to repossession or sale of such property),
(F) all monetary obligations under any leasing or similar arrangement which, in connection with GAAP, consistently applied for
the periods covered thereby, is classified as a capital lease, (G) all indebtedness referred to in clauses (A) through (F) above
secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any
Lien upon or in any property or assets (including accounts and contract rights) owned by any Person, even though the Person which
owns such assets or property has not assumed or become liable for the payment of such indebtedness, and (H) all Contingent Obligations
in respect of indebtedness or obligations of others of the kinds referred to in clauses (A) through (G) above; and (y) “Contingent
Obligation” means, as to any Person, any direct or indirect liability, contingent or otherwise, of that Person with
respect to any Indebtedness, lease, dividend or other obligation of another Person if the primary purpose or intent of the Person
incurring such liability, or the primary effect thereof, is to provide assurance to the obligee of such liability that such liability
will be paid or discharged, or that any agreements relating thereto will be complied with, or that the holders of such liability
will be protected (in whole or in part) against loss with respect thereto.


 


(t) Litigation.
Except as disclosed in the SEC Documents, there is no action, suit, arbitration, proceeding, inquiry or investigation before or
by the Principal Market, any court, public board, other Governmental Entity, self-regulatory organization or body pending or,
to the knowledge of the Company, threatened against or affecting the Company or any of its Subsidiaries, the Ordinary Shares or
any of the Company’s or its Subsidiaries’ officers or directors , whether of a civil or criminal nature or otherwise,
in their capacities as such, except as set forth in Schedule 3(t). No director, officer or employee of the Company or any
of its subsidiaries has willfully violated 18 U.S.C. §1519 or engaged in spoliation in reasonable anticipation of litigation.
Without limitation of the foregoing, there has not been, and to the knowledge of the Company, there is not pending or contemplated,
any investigation by the SEC involving the Company, any of its Subsidiaries or any current or former director or officer of the
Company or any of its Subsidiaries. The SEC has not issued any stop order or other order suspending the effectiveness of any registration
statement filed by the Company under the 1933 Act or the 1934 Act. After reasonable inquiry of its employees, the Company is not
aware of any fact which might result in or form the basis for any such action, suit, arbitration, investigation, inquiry or other
proceeding. Neither the Company nor any of its Subsidiaries is subject to any order, writ, judgment, injunction, decree, determination
or award of any Governmental Entity.


 






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(u) Insurance.
Except as disclosed in the SEC Documents, the Company and each of its Subsidiaries are insured by insurers of recognized financial
responsibility against such losses and risks and in such amounts as management of the Company believes to be prudent and customary
in the businesses in which the Company and its Subsidiaries are engaged. Neither the Company nor any such Subsidiary has been
refused any insurance coverage sought or applied for, and neither the Company nor any such Subsidiary has any reason to believe
that it will be unable to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage
from similar insurers as may be necessary to continue its business at a cost that would not have a Material Adverse Effect.


 


(v) Employee
Relations. Neither the Company nor any of its Subsidiaries is a party to any collective
bargaining agreement or employs any member of a union. The Company and its Subsidiaries believe that their relations with their
employees are good. No executive officer (as defined in Rule 501(f) promulgated under the 1933 Act) or other key employee of the
Company or any of its Subsidiaries has notified the Company or any such Subsidiary that such officer intends to leave the Company
or any such Subsidiary or otherwise terminate such officer’s employment with the Company or any such Subsidiary. No executive
officer or other key employee of the Company or any of its Subsidiaries is, or is now expected to be, in violation of any material
term of any employment contract, confidentiality, disclosure or proprietary information agreement, non-competition agreement,
or any other contract or agreement or any restrictive covenant, and the continued employment of each such executive officer or
other key employee (as the case may be) does not subject the Company or any of its Subsidiaries to any liability with respect
to any of the foregoing matters. The Company and its Subsidiaries are in compliance with all federal, state, local and foreign
laws and regulations respecting labor, employment and employment practices and benefits, terms and conditions of employment and
wages and hours, except where failure to be in compliance would not, either individually or in the aggregate, reasonably be expected
to result in a Material Adverse Effect.


 


(w) Title.


 


(i) Real
Property. Each of the Company and its Subsidiaries holds good title to all real property, leases in real property, facilities
or other interests in real property owned or held by the Company or any of its Subsidiaries (the “Real Property”)
owned by the Company or any of its Subsidiaries (as applicable). The Real Property is free and clear of all Liens and is not subject
to any rights of way, building use restrictions, exceptions, variances, reservations, or limitations of any nature except for (a)
Liens for current taxes not yet due and (b) zoning laws and other land use restrictions that do not impair the present or anticipated
use of the property subject thereto. Any Real Property held under lease by the Company or any of its Subsidiaries are held by them
under valid, subsisting and enforceable leases with such exceptions as are not material and do not interfere with the use made
and proposed to be made of such property and buildings by the Company or any of its Subsidiaries.


 






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(ii) Fixtures
and Equipment. Each of the Company and its Subsidiaries (as applicable) has good title to, or a valid leasehold interest in,
the tangible personal property, equipment, improvements, fixtures, and other personal property and appurtenances that are used
by the Company or its Subsidiary in connection with the conduct of its business (the “Fixtures and Equipment”).
The Fixtures and Equipment are structurally sound, are in good operating condition and repair, are adequate for the uses to which
they are being put, are not in need of maintenance or repairs except for ordinary, routine maintenance and repairs and are sufficient
for the conduct of the Company’s and/or its Subsidiaries’ businesses (as applicable) in the manner as conducted prior
to the Closing. Each of the Company and its Subsidiaries owns all of its Fixtures and Equipment free and clear of all Liens except
for (a) liens for current taxes not yet due and (b) zoning laws and other land use restrictions that do not impair the present
or anticipated use of the property subject thereto.


 


(x) Potential
Products; CFDA.


 


(i) Except
as described in the SEC Documents, the Company possesses all certificates, authorizations and permits issued by the appropriate
federal, state or foreign regulatory authorities necessary to conduct its business as currently conducted, including without limitation
all such certificates, authorizations and permits required by the Chinese States Food and Drug Administration (the “CFDA”)
or any other Governmental Entity engaged in the regulation of pharmaceuticals, medical devices or biohazardous materials, except
where the failure to so possess such certificates, authorizations and permits, individually or in the aggregate, would not result
in a Material Adverse Effect. Except as described in the SEC Documents, the Company has not received any notice of proceedings
relating to the revocation or modification of any such certificate, authorization or permit which, individually or in the aggregate,
if the subject of an unfavorable decision, ruling or finding, would have a Material Adverse Effect.


 


(ii) Except
to the extent disclosed in the SEC Documents, the Company has not received any written notices or statements from the CFDA or any
other or any other applicable Governmental Entity, and otherwise has no knowledge or reason to believe, that (i) any drug candidate
of the Company described in the SEC Documents (each a “Potential Product”) is reasonably likely to be rejected
or determined to be non-approvable; (ii) a delay in time for review and/or approval of a marketing authorization application or
marketing approval application in any jurisdiction for any Potential Product is reasonably likely to be required, requested or
being implemented; (iii) one or more clinical studies for any Potential Product is reasonably likely to be requested or required
in addition to the clinical studies submitted to the CFDA prior to the date hereof as a precondition to or condition of issuance
or maintenance of a marketing approval for any Potential Product; (iv) any license, approval, permit or authorization to conduct
any clinical trial of or market any product or Potential Product of the Company has been or is reasonably likely to be suspended,
revoked, modified or limited, except in the cases of clauses (i), (ii), (iii) and (iv) where such rejections, determinations, delays,
requests, suspensions, revocations, modifications or limitations would not reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect.


 






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(iii) Except
to the extent disclosed in the SEC Documents, to the Company’s knowledge, the preclinical and clinical testing, application
for marketing approval of, manufacture, distribution, promotion and sale of the products and Potential Products of the Company
is in compliance, in all material respects, with all laws, rules and regulations applicable to such activities, including without
limitation applicable good laboratory practices, good clinical practices and good manufacturing practices, except for such non-compliance
as would not, individually or in the aggregate, be reasonably likely to have a Material Adverse Effect. The descriptions of the
results of such tests and trials contained in the SEC Documents are complete and accurate in all material respects such that there
would be no untrue statement of a material fact or omission of a material fact necessary to make the statements in the SEC Documents,
in light of the circumstances under which they are made, not misleading. The Company is not aware of any studies, tests or trial
the results of which reasonably call into question the results of the tests and trials conducted by or on behalf of the Company
that are described or referred to in the SEC Documents. Except to the extent disclosed in the SEC Documents, the Company has not
received notice of adverse finding, warning letter or clinical hold notice from the CFDA or any applicable counterpart of any of
the foregoing, or any untitled letter or other correspondence or notice from the CFDA or any other governmental authority or agency
or any institutional or ethical review board alleging or asserting noncompliance with any law, rule or regulation applicable in
any jurisdiction, except notices, letters, and correspondences and counterparts thereof alleging or asserting such noncompliance
as would not, individually or in the aggregate, be reasonably likely to have a Material Adverse Effect. Except to the extent disclosed
in the SEC Documents, the Company has not, either voluntarily or involuntarily, initiated, conducted or issued, or caused to be
initiated, conducted or issued, any recall, field correction, market withdrawal or replacement, safety alert, warning, “dear
doctor” letter, investigator notice, or other notice or action relating to an alleged or potential lack of safety or efficacy
of any product or Potential Product of the Company, any alleged product defect of any product or Potential Product of the Company,
or any violation of any material applicable law, rule, regulation or any clinical trial or marketing license, approval, permit
or authorization for any product or Potential Product of the Company, and the Company is not aware of any facts or information
that would cause it to initiate any such notice or action and has no knowledge or reason to believe that the CFDA or any other
Governmental Entity or authority or any institutional or ethical review board or other non-governmental authority intends to impose,
require, request or suggest such notice or action.


 


(y) Intellectual
Property Rights. The Company and its Subsidiaries own or possess adequate rights
or licenses to use all trademarks, trade names, service marks, service mark registrations, service names, original works of authorship,
patents, patent rights, copyrights, inventions, licenses, approvals, governmental authorizations, trade secrets and other intellectual
property rights and all applications and registrations therefor (“Intellectual Property Rights”) necessary
to conduct their respective businesses as now conducted and presently proposed to be conducted. Each of patents owned by the Company
or any of its Subsidiaries is listed on Schedule 3(y)(i). Except as set forth in Schedule 3(y)(ii), none of the Company's Intellectual
Property Rights have expired or terminated or have been abandoned or are expected to expire or terminate or are expected to be
abandoned, within three years from the date of this Agreement. The Company does not have any knowledge of any infringement by
the Company or its Subsidiaries of Intellectual Property Rights of others. There is no claim, action or proceeding being made
or brought, or to the knowledge of the Company or any of its Subsidiaries, being threatened, against the Company or any of its
Subsidiaries regarding its Intellectual Property Rights. Neither the Company nor any of its Subsidiaries is aware of any facts
or circumstances which might give rise to any of the foregoing infringements or claims, actions or proceedings. The Company and
its Subsidiaries have taken reasonable security measures to protect the secrecy, confidentiality and value of all of their Intellectual
Property Rights


 






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(z) Environmental
Laws. (i) The Company and its Subsidiaries (A) are in compliance with any and all Environmental Laws (as defined below),
(B) have received all permits, licenses or other approvals required of them under applicable Environmental Laws to conduct
their respective businesses and (C) are in compliance with all terms and conditions of any such permit, license or approval
where, in each of the foregoing clauses (A), (B) and (C), the failure to so comply could be reasonably expected to have,
individually or in the aggregate, a Material Adverse Effect. The term “Environmental Laws” means all
federal, state, local or foreign laws relating to pollution or protection of human health or the environment (including,
without limitation, ambient air, surface water, groundwater, land surface or subsurface strata), including, without
limitation, laws relating to emissions, discharges, releases or threatened releases of chemicals, pollutants, contaminants,
or toxic or hazardous substances or wastes (collectively, “Hazardous Materials”) into the environment, or
otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of
Hazardous Materials, as well as all authorizations, codes, decrees, demands or demand letters, injunctions, judgments,
licenses, notices or notice letters, orders, permits, plans or regulations issued, entered, promulgated or approved
thereunder.


 


(ii) No
Hazardous Materials:


 


(A) have
been disposed of or otherwise released from any Real Property of the Company or any of its Subsidiaries in violation of any Environmental
Laws; or


 


(B) are
present on, over, beneath, in or upon a Real Property or any portion thereof in quantities that would constitute a violation of
any Environmental Laws. No prior use by the Company or any of its Subsidiaries of any Real Property has occurred that violates
any Environmental Laws, which violation would have a material adverse effect on the business of the Company or any of its Subsidiaries.


 


(iii) Neither
the Company nor any of its Subsidiaries knows of any other person who or entity which has stored, treated, recycled, disposed of
or otherwise located on any Real Property any Hazardous Materials, including, without limitation, such substances as asbestos and
polychlorinated biphenyls.


 






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(iv) None
of the Real Properties are on any federal or state “Superfund” list or Liability Information System (“CERCLIS”)
list or any state environmental agency list of sites under consideration for CERCLIS, nor subject to any environmental related
Liens.


 


(aa)Subsidiary
Rights. The Company or one of its Subsidiaries has the unrestricted right to vote,
and (subject to limitations imposed by applicable law) to receive dividends and distributions on, all capital securities of its
Subsidiaries as owned by the Company or such Subsidiary.


 


(bb)Tax Status.
The Company and each of its Subsidiaries (i) has timely made or filed all foreign, federal and state income and all other tax
returns, reports and declarations required by any jurisdiction to which it is subject, (ii) has timely paid all taxes and other
governmental assessments and charges that are material in amount, shown or determined to be due on such returns, reports and declarations,
except those being contested in good faith and (iii) has set aside on its books provision reasonably adequate for the payment
of all taxes for periods subsequent to the periods to which such returns, reports or declarations apply. There are no unpaid taxes
in any material amount claimed to be due by the taxing authority of any jurisdiction, and the officers of the Company and its
Subsidiaries know of no basis for any such claim. The Company is not operated in such a manner as to qualify as a passive foreign
investment company, as defined in Section 1297 of the Code. The net operating loss carryforwards (“NOLs”) for
United States federal income tax purposes of the consolidated group of which the Company is the common parent, if any, shall not
be adversely effected by the transactions contemplated hereby. The transactions contemplated hereby do not constitute an “ownership
change” within the meaning of Section 382 of the Code, thereby preserving the Company’s ability to utilize such NOLs.


 


(cc)Internal
Accounting and Disclosure Controls. Except as disclosed in Schedule 3(cc), the
Company and each of its Subsidiaries maintains internal control over financial reporting (as such term is defined in Rule 13a-15(f)
under the 1934 Act) that is effective to provide reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with generally accepted accounting principles, including
that (i) transactions are executed in accordance with management’s general or specific authorizations, (ii) transactions
are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain asset and liability
accountability, (iii) access to assets or incurrence of liabilities is permitted only in accordance with management’s general
or specific authorization and (iv) the recorded accountability for assets and liabilities is compared with the existing assets
and liabilities at reasonable intervals and appropriate action is taken with respect to any difference. Except as disclosed in
Schedule 3(cc), the Company maintains disclosure controls and procedures (as such term is defined in Rule 13a-15(e) under the
1934 Act) that are effective in ensuring that information required to be disclosed by the Company in the reports that it files
or submits under the 1934 Act is recorded, processed, summarized and reported, within the time periods specified in the rules
and forms of the SEC, including, without limitation, controls and procedures designed to ensure that information required to be
disclosed by the Company in the reports that it files or submits under the 1934 Act is accumulated and communicated to the Company’s
management, including its principal executive officer or officers and its principal financial officer or officers, as appropriate,
to allow timely decisions regarding required disclosure. Except as disclosed in Schedule 3(cc), neither the Company nor any of
its Subsidiaries has received any notice or correspondence from any accountant, Governmental Entity or other Person relating to
any potential material weakness or significant deficiency in any part of the internal controls over financial reporting of the
Company or any of its Subsidiaries.


 






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(dd)Off Balance
Sheet Arrangements. There is no transaction, arrangement, or other relationship
between the Company or any of its Subsidiaries and an unconsolidated or other off balance sheet entity that is required to be
disclosed by the Company in its 1934 Act filings and is not so disclosed or that otherwise could be reasonably likely to have
a Material Adverse Effect.


 


(ee)Investment
Company Status. The Company is not, and upon consummation of the sale of the Securities
will not be, an “investment company,” an affiliate of an “investment company,” a company controlled by
an “investment company” or an “affiliated person” of, or “promoter” or “principal underwriter”
for, an “investment company” as such terms are defined in the Investment Company Act of 1940, as amended.


 


(ff)Acknowledgement
Regarding Buyers’ Trading Activity. It is understood and acknowledged by
the Company that (i) following the public disclosure of the transactions contemplated by the Transaction Documents, in accordance
with the terms thereof, none of the Buyers have been asked by the Company or any of its Subsidiaries to agree, nor has any Buyer
agreed with the Company or any of its Subsidiaries, to desist from effecting any transactions in or with respect to (including,
without limitation, purchasing or selling, long and/or short) any securities of the Company, or “derivative” securities
based on securities issued by the Company or to hold any of the Securities for any specified term; (ii) any Buyer, and counterparties
in “derivative” transactions to which any such Buyer is a party, directly or indirectly, presently may have a “short”
position in the Ordinary Shares which was established prior to such Buyer’s knowledge of the transactions contemplated by
the Transaction Documents; (iii) each Buyer shall not be deemed to have any affiliation with or control over any arm’s length
counterparty in any “derivative” transaction; and (iv) each Buyer may rely on the Company’s obligation to timely
deliver Ordinary Shares upon conversion, exercise or exchange, as applicable, of the Securities as and when required pursuant
to the Transaction Documents for purposes of effecting trading in the Ordinary Shares of the Company. The Company further understands
and acknowledges that following the public disclosure of the transactions contemplated by the Transaction Documents pursuant to
the Press Release (as defined below) one or more Buyers may engage in hedging and/or trading activities (including, without limitation,
the location and/or reservation of borrowable Ordinary Shares) at various times during the period that the Securities are outstanding,
including, without limitation, during the periods that the value and/or number of the Warrant Shares or Conversion Shares, as
applicable, deliverable with respect to the Securities are being determined and such hedging and/or trading activities (including,
without limitation, the location and/or reservation of borrowable Ordinary Shares), if any, can reduce the value of the existing
shareholders’ equity interest in the Company both at and after the time the hedging and/or trading activities are being
conducted. The Company acknowledges that such aforementioned hedging and/or trading activities do not constitute a breach of this
Agreement, the Notes, the Warrants or any other Transaction Document or any of the documents executed in connection herewith or
therewith.


 






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(gg)Manipulation
of Price. Neither the Company nor any of its Subsidiaries has, and, to the knowledge
of the Company, no Person acting on their behalf has, directly or indirectly, (i) taken any action designed to cause or to result
in the stabilization or manipulation of the price of any security of the Company or any of its Subsidiaries to facilitate the
sale or resale of any of the Securities, (ii) sold, bid for, purchased, or paid any compensation for soliciting purchases of,
any of the Securities (other than the Placement Agent), (iii) paid or agreed to pay to any Person any compensation for soliciting
another to purchase any other securities of the Company or any of its Subsidiaries or (iv) paid or agreed to pay any Person for
research services with respect to any securities of the Company or any of its Subsidiaries.


 


(hh)U.S. Real
Property Holding Corporation. Neither the Company nor any of its Subsidiaries is,
or has ever been, and so long as any of the Securities are held by any of the Buyers, shall become, a U.S. real property holding
corporation within the meaning of Section 897 of the Code, and the Company and each Subsidiary shall so certify upon any
Buyer’s request.


 


(ii) Registration
Eligibility. The Company is eligible to register the Registrable Securities for
resale by the Buyers using Form F-1 promulgated under the 1933 Act.


 


(jj)Transfer
Taxes. On the Closing Date, all share transfer or other taxes (other than income
or similar taxes) which are required to be paid in connection with the issuance, sale and transfer of the Securities to be sold
to each Buyer hereunder will be, or will have been, fully paid or provided for by the Company, and all laws imposing such taxes
will be or will have been complied with.


 


(kk)Bank Holding
Company Act. Neither the Company nor any of its Subsidiaries is subject to the
Bank Holding Company Act of 1956, as amended (the “BHCA”) and to regulation by the Board of Governors of the
Federal Reserve System (the “Federal Reserve”). Neither the Company nor any of its Subsidiaries or affiliates
owns or controls, directly or indirectly, five percent (5%) or more of the outstanding shares of any class of voting securities
or twenty-five percent (25%) or more of the total equity of a bank or any entity that is subject to the BHCA and to regulation
by the Federal Reserve. Neither the Company nor any of its Subsidiaries or affiliates exercises a controlling influence over the
management or policies of a bank or any entity that is subject to the BHCA and to regulation by the Federal Reserve.


 


(ll)Shell Company
Status. The Company is not, and has never been, an issuer identified in, or subject
to, Rule 144(i).


 


(mm)Illegal
or Unauthorized Payments; Political Contributions. Neither the Company nor any
of its Subsidiaries nor, to the best of the Company’s knowledge (after reasonable inquiry of its officers and directors),
any of the officers, directors, employees, agents or other representatives of the Company or any of its Subsidiaries or any other
business entity or enterprise with which the Company or any Subsidiary is or has been affiliated or associated, has, directly
or indirectly, made or authorized any payment, contribution or gift of money, property, or services, whether or not in contravention
of applicable law, (i) as a kickback or bribe to any Person or (ii) to any political organization, or the holder of or any aspirant
to any elective or appointive public office except for personal political contributions not involving the direct or indirect use
of funds of the Company or any of its Subsidiaries.


 






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(nn)Money Laundering.
The Company and its Subsidiaries are in compliance with, and have not previously violated, the USA Patriot Act of 2001 and all
other applicable U.S. and non-U.S. anti-money laundering laws and regulations, including, without limitation, the laws, regulations
and Executive Orders and sanctions programs administered by the U.S. Office of Foreign Assets Control, including, but not limited,
to (i) Executive Order 13224 of September 23, 2001 entitled, “Blocking Property and Prohibiting Transactions With Persons
Who Commit, Threaten to Commit, or Support Terrorism” (66 Fed. Reg. 49079 (2001)); and (ii) any regulations contained in
31 CFR, Subtitle B, Chapter V.


 


(oo) Management.
Except as set forth in Schedule 3(oo) hereto, during the past five year period, no current or former officer or director
or, to the knowledge of the Company, no current ten percent (10%) or greater shareholder of the Company or any of its Subsidiaries
has been the subject of:


 


(i) a
petition under bankruptcy laws or any other insolvency or moratorium law or the appointment by a court of a receiver, fiscal agent
or similar officer for such Person, or any partnership in which such person was a general partner at or within two years before
the filing of such petition or such appointment, or any corporation or business association of which such person was an executive
officer at or within two years before the time of the filing of such petition or such appointment;


 


(ii) a
conviction in a criminal proceeding or a named subject of a pending criminal proceeding (excluding traffic violations that do not
relate to driving while intoxicated or driving under the influence);


 


(iii) any
order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently
or temporarily enjoining any such person from, or otherwise limiting, the following activities:


 


(1) Acting
as a futures commission merchant, introducing broker, commodity trading advisor, commodity pool operator, floor broker, leverage
transaction merchant, any other person regulated by the United States Commodity Futures Trading Commission or an associated person
of any of the foregoing, or as an investment adviser, underwriter, broker or dealer in securities, or as an affiliated person,
director or employee of any investment company, bank, savings and loan association or insurance company, or engaging in or continuing
any conduct or practice in connection with such activity;


 


(2) Engaging
in any particular type of business practice; or


 


(3) Engaging
in any activity in connection with the purchase or sale of any security or commodity or in connection with any violation of securities
laws or commodities laws;


 


(iv) any
order, judgment or decree, not subsequently reversed, suspended or vacated, of any authority barring, suspending or otherwise limiting
for more than sixty (60) days the right of any such person to engage in any activity described in the preceding sub paragraph,
or to be associated with persons engaged in any such activity;


 






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(v) a
finding by a court of competent jurisdiction in a civil action or by the SEC or other authority to have violated any securities
law, regulation or decree and the judgment in such civil action or finding by the SEC or any other authority has not been subsequently
reversed, suspended or vacated; or


 


(vi) a
finding by a court of competent jurisdiction in a civil action or by the Commodity Futures Trading Commission to have violated
any federal commodities law, and the judgment in such civil action or finding has not been subsequently reversed, suspended or
vacated.


 


(pp)Share Option
Plans. Each share option granted by the Company was granted (i) in accordance with
the terms of the applicable share option plan of the Company and (ii) with an exercise price at least equal to the fair market
value of the Ordinary Shares on the date such share option would be considered granted under GAAP and applicable law. No share
option granted under the Company's share option plan has been backdated. The Company has not knowingly granted, and there is no
and has been no policy or practice of the Company to knowingly grant, share options prior to, or otherwise knowingly coordinate
the grant of share options with, the release or other public announcement of material information regarding the Company or its
Subsidiaries or their financial results or prospects.


 


(qq)No Disagreements
with Accountants and Lawyers. There are no material disagreements of any kind presently
existing, or reasonably anticipated by the Company to arise, between the Company and the accountants and lawyers formerly or presently
employed by the Company and the Company is current with respect to any fees owed to its accountants and lawyers which could affect
the Company's ability to perform any of its obligations under any of the Transaction Documents. In addition, on or prior to the
date hereof, the Company had discussions with its accountants about its financial statements previously filed with the SEC. Based
on those discussions, the Company has no reason to believe that it will need to restate any such financial statements or any part
thereof.


 


(rr)No Disqualification
Events. With respect to Securities to be offered and sold hereunder in reliance
on Rule 506(b) under the 1933 Act (“Regulation D Securities”), none of the Company, any of its predecessors,
any affiliated issuer, any director, executive officer, other officer of the Company participating in the offering contemplated
hereby, any beneficial owner of 20% or more of the Company's outstanding voting equity securities, calculated on the basis of
voting power, nor any promoter (as that term is defined in Rule 405 under the 1933 Act) connected with the Company in any capacity
at the time of sale (each, an “Issuer Covered Person” and, together, “Issuer Covered Persons”)
is subject to any of the “Bad Actor” disqualifications described in Rule 506(d)(1)(i) to (viii) under the 1933 Act
(a “Disqualification Event”), except for a Disqualification Event covered by Rule 506(d)(2) or (d)(3). The
Company has exercised reasonable care to determine whether any Issuer Covered Person is subject to a Disqualification Event. The
Company has complied, to the extent applicable, with its disclosure obligations under Rule 506(e), and has furnished to the Buyers
a copy of any disclosures provided thereunder.


 


(ss)Other Covered
Persons. The Company is not aware of any Person (other than the Placement Agent)
that has been or will be paid (directly or indirectly) remuneration for solicitation of Buyers or potential purchasers in connection
with the sale of any Regulation D Securities.


 






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(tt)No Additional
Agreements. The Company does not have any agreement or understanding with any Buyer
with respect to the transactions contemplated by the Transaction Documents other than as specified in the Transaction Documents.


 


(uu)Public
Utility Holding Act. None of the Company nor any of its Subsidiaries is a “holding
company,” or an “affiliate” of a “holding company,” as such terms are defined in the Public Utility
Holding Act of 2005.


 


(vv)Federal
Power Act. None of the Company nor any of its Subsidiaries is subject to regulation
as a “public utility” under the Federal Power Act, as amended.


 


(ww)Ranking
of Notes. No Indebtedness of the Company, at the Closing, will be senior to, or
pari passu with, the Notes in right of payment, whether with respect to payment or redemptions, interest, damages, upon
liquidation or dissolution or otherwise.


 


(xx) Disclosure.
The Company confirms that neither it nor any other Person acting on its behalf has provided any of the Buyers or their agents
or counsel with any information that constitutes or could reasonably be expected to constitute material, non-public information
concerning the Company or any of its Subsidiaries, other than the existence of the transactions contemplated by this Agreement
and the other Transaction Documents. The Company understands and confirms that each of the Buyers will rely on the foregoing representations
in effecting transactions in securities of the Company. All disclosure provided to the Buyers regarding the Company and its Subsidiaries,
their businesses and the transactions contemplated hereby, including the schedules to this Agreement, furnished by or on behalf
of the Company or any of its Subsidiaries is true and correct and does not contain any untrue statement of a material fact or
omit to state any material fact necessary in order to make the statements made therein, in the light of the circumstances under
which they were made, not misleading. All of the written information furnished after the date hereof by or on behalf of the Company
or any of its Subsidiaries to each Buyer pursuant to or in connection with this Agreement and the other Transaction Documents,
taken as a whole, will be true and correct in all material respects as of the date on which such information is so provided and
will not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements
made therein, in the light of the circumstances under which they were made, not misleading. Each press release issued by the Company
or any of its Subsidiaries during the twelve (12) months preceding the date of this Agreement did not at the time of release contain
any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to
make the statements therein, in the light of the circumstances under which they are made, not misleading. To the Company’s
knowledge, no event or circumstance has occurred or information exists with respect to the Company or any of its Subsidiaries
or its or their business, properties, liabilities, prospects, operations (including results thereof) or conditions (financial
or otherwise), which, under applicable law, rule or regulation, requires public disclosure at or before the date hereof or announcement
by the Company but which has not been so publicly disclosed. The Company acknowledges and agrees that no Buyer makes or has made
any representations or warranties with respect to the transactions contemplated hereby other than those specifically set forth
in Section 2.


 






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4. COVENANTS.


 


(a) Best Efforts.
Each Buyer shall use its best efforts to timely satisfy each of the covenants hereunder and conditions to be satisfied by it as
provided in Section 6 of this Agreement. The Company shall use its best efforts to timely satisfy each of the covenants hereunder
and conditions to be satisfied by it as provided in Section 7 of this Agreement.


 


(b) Form D
and Blue Sky. The Company shall file a Form D with respect to the Securities as
required under Regulation D and to provide a copy thereof to each Buyer promptly after such filing. The Company shall, on or before
the Closing Date, take such action as the Company shall reasonably determine is necessary in order to obtain an exemption for,
or to, qualify the Securities for sale to the Buyers at the Closing pursuant to this Agreement under applicable securities or
“Blue Sky” laws of the states of the United States (or to obtain an exemption from such qualification), and shall
provide evidence of any such action so taken to the Buyers on or prior to the Closing Date. Without limiting any other obligation
of the Company under this Agreement, the Company shall timely make all filings and reports relating to the offer and sale of the
Securities required under all applicable securities laws (including, without limitation, all applicable federal securities laws
and all applicable “Blue Sky” laws), and the Company shall comply with all applicable foreign, federal, state and
local laws, statutes, rules, regulations and the like relating to the offering and sale of the Securities to the Buyers.


 


(c) Reporting
Status. Until the date on which the Buyers shall have sold all of the Registrable
Securities (the “Reporting Period”), the Company shall timely file all reports required to be filed with the
SEC pursuant to the 1934 Act, and the Company shall not terminate its status as an issuer required to file reports under the 1934
Act even if the 1934 Act or the rules and regulations thereunder would no longer require or otherwise permit such termination.
From the time Form F-3 is available to the Company for the registration of the Registrable Securities, the Company shall take
all actions necessary to maintain its eligibility to register the Registrable Securities for resale by the Buyers on Form F-3.


 


(d) Use of
Proceeds. The Company will use the proceeds from the sale of the Securities for
general corporate purposes, but not, directly or indirectly, for (i) except as set forth on Schedule 4(d), the satisfaction of
any indebtedness of the Company or any of its Subsidiaries, (ii) the redemption or repurchase of any securities of the Company
or any of its Subsidiaries, or (iii) the settlement of any outstanding litigation.


 


(e) Financial
Information. The Company agrees to send the following to each Investor (as defined
in the Registration Rights Agreement) during the Reporting Period (i) unless the following are filed with the SEC through EDGAR
and are available to the public through the EDGAR system, within one (1) Business Day after the filing thereof with the SEC, a
copy of its Annual Report on Form 20-F, Report of Foreign Issuer on Form 6-K, any other interim reports or any consolidated balance
sheets, income statements, shareholders’ equity statements and/or cash flow statements for any period other than annual,
any Report of Foreign Issuer on Form 6-K and any registration statements (other than on Form F-8) or amendments filed pursuant
to the 1933 Act, (ii) unless the following are either filed with the SEC through EDGAR or are otherwise widely disseminated via
a recognized news release service (such as PR Newswire), on the same day as the release thereof, facsimile copies of all press
releases issued by the Company or any of its Subsidiaries and (iii) unless the following are filed with the SEC through EDGAR,
copies of any notices and other information made available or given to the shareholders of the Company generally, contemporaneously
with the making available or giving thereof to the shareholders.


 






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(f) Listing.
The Company shall promptly secure the listing or designation for quotation (as the case may be) of all of the Registrable Securities
upon each national securities exchange and automated quotation system, if any, upon which the Ordinary Shares is then listed or
designated for quotation (as the case may be) (subject to official notice of issuance) and shall maintain such listing or designation
for quotation (as the case may be) of all Registrable Securities from time to time issuable under the terms of the Transaction
Documents on such national securities exchange or automated quotation system. The Company shall maintain the Ordinary Shares’
listing or authorization for quotation (as the case may be) on the Principal Market, The New York Stock Exchange, the NYSE American,
the Nasdaq Capital Market, the Nasdaq Global Market or the Nasdaq Global Select Market (each, an “Eligible Market”).
Neither the Company nor any of its Subsidiaries shall take any action which could be reasonably expected to result in the delisting
or suspension of the Ordinary Shares on an Eligible Market. The Company shall pay all fees and expenses in connection with satisfying
its obligations under this Section 4(f).


 


(g) Fees.
The Company shall reimburse the lead Buyer for all reasonable costs and expenses incurred by it or its affiliates in connection
with the structuring, documentation, negotiation and closing of the transactions contemplated by the Transaction Documents (including,
without limitation, as applicable, all reasonable legal fees of outside counsel and disbursements of Kelley Drye & Warren
LLP, counsel to the lead Buyer, any other reasonable fees and expenses in connection with the structuring, documentation, negotiation
and closing of the transactions contemplated by the Transaction Documents and due diligence and regulatory filings in connection
therewith) (the “Transaction Expenses”) and shall be withheld by the lead Buyer from its Purchase Price at
the Closing, less $25,000 previously paid by the Company to the lead Buyer; provided, that the aggregate Transaction Expenses
shall not exceed $75,000 and the Company shall promptly reimburse Kelley Drye & Warren LLP on demand for all Transaction Expenses
not so reimbursed through such withholding at the Closing. The Company shall be responsible for the payment of any placement agent’s
fees, financial advisory fees, transfer agent fees, DTC (as defined below) fees or broker’s commissions (other than for
Persons engaged by any Buyer) relating to or arising out of the transactions contemplated hereby (including, without limitation,
any fees or commissions payable to the Placement Agent, who is the Company’s sole placement agent in connection with the
transactions contemplated by this Agreement). The Company shall pay, and hold each Buyer harmless against, any liability, loss
or expense (including, without limitation, reasonable attorneys’ fees and out-of-pocket expenses) arising in connection
with any claim relating to any such payment. Except as otherwise set forth in the Transaction Documents, each party to this Agreement
shall bear its own expenses in connection with the sale of the Securities to the Buyers.


 


(h) Pledge
of Securities. Notwithstanding anything to the contrary contained in this Agreement,
the Company acknowledges and agrees that the Securities may be pledged by an Investor in connection with a bona fide margin agreement
or other loan or financing arrangement that is secured by the Securities. The pledge of Securities shall not be deemed to be a
transfer, sale or assignment of the Securities hereunder, and no Investor effecting a pledge of Securities shall be required to
provide the Company with any notice thereof or otherwise make any delivery to the Company pursuant to this Agreement or any other
Transaction Document, including, without limitation, Section 2(g) hereof; provided that an Investor and its pledgee shall
be required to comply with the provisions of Section 2(g) hereof in order to effect a sale, transfer or assignment of Securities
to such pledgee. The Company hereby agrees to execute and deliver such documentation as a pledgee of the Securities may reasonably
request in connection with a pledge of the Securities to such pledgee by a Buyer.


 






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(i) Disclosure
of Transactions and Other Material Information.


 


(i) Disclosure
of Transaction. The Company shall, on or before 9:30 a.m., New York time, on the first (1st) Business Day after
the date of this Agreement, issue a press release (the “Press Release”) reasonably acceptable to the Buyers
disclosing all the material terms of the transactions contemplated by the Transaction Documents. On or before 9:30 a.m., New York
time, on the first (1st) Business Day after the date of this Agreement, the Company shall file a Report of Foreign Issuer
on Form 6-K describing all the material terms of the transactions contemplated by the Transaction Documents in the form required
by the 1934 Act and attaching all the material Transaction Documents (including, without limitation, this Agreement (and all schedules
to this Agreement), the form of Notes, the form of Investor Note, the form of the Warrants, the form of Pledge Agreement, the form
of Master Netting Agreement and the form of Note Purchase Agreement, the form of Pledge Agreement and the form of the Registration
Rights Agreement) (including all attachments, the “6-K Filing”). From and after the filing of the 6-K Filing,
the Company shall have disclosed all material, non-public information (if any) provided to any of the Buyers by the Company or
any of its Subsidiaries or any of their respective officers, directors, employees or agents in connection with the transactions
contemplated by the Transaction Documents. In addition, effective upon the filing of the 6-K Filing, the Company acknowledges and
agrees that any and all confidentiality or similar obligations under any agreement, whether written or oral, between the Company,
any of its Subsidiaries or any of their respective officers, directors, affiliates, employees or agents, on the one hand, and any
of the Buyers or any of their affiliates, on the other hand, shall terminate.


 


(ii) Limitations
on Disclosure. The Company shall not, and the Company shall cause each of its Subsidiaries and each of its and their respective
officers, directors, employees and agents not to, provide any Buyer with any material, non-public information regarding the Company
or any of its Subsidiaries from and after the date hereof without the express prior written consent of such Buyer (which may be
granted or withheld in such Buyer’s sole discretion). In the event of a breach of any of the foregoing covenants, including,
without limitation, Section 4(o) of this Agreement, or any of the covenants or agreements contained in any other Transaction
Document, by the Company, any of its Subsidiaries, or any of its or their respective officers, directors, employees and agents
(as determined in the reasonable good faith judgment of such Buyer), in addition to any other remedy provided herein or in the
Transaction Documents, such Buyer shall have the right to make a public disclosure, in the form of a press release, public advertisement
or otherwise, of such breach or such material, non-public information, as applicable, without the prior approval by the Company,
any of its Subsidiaries, or any of its or their respective officers, directors, employees or agents. No Buyer shall have any liability
to the Company, any of its Subsidiaries, or any of its or their respective officers, directors, employees, affiliates, shareholders
or agents, for any such disclosure. To the extent that the Company delivers any material, non-public information to a Buyer without
such Buyer's consent, the Company hereby covenants and agrees that such Buyer shall not have any duty of confidentiality with respect
to, or a duty not to trade on the basis of, such material, non-public information. Subject to the foregoing, neither the Company,
its Subsidiaries nor any Buyer shall issue any press releases or any other public statements with respect to the transactions contemplated
hereby; provided, however, the Company shall be entitled, without the prior approval of any Buyer, to make the Press Release and
any press release or other public disclosure with respect to such transactions (i) in substantial conformity with the 6-K Filing
and contemporaneously therewith and (ii) as is required by applicable law and regulations (provided that in the case of clause
(i) each Buyer shall be consulted by the Company in connection with any such press release or other public disclosure prior to
its release). Without the prior written consent of the applicable Buyer (which may be granted or withheld in such Buyer’s
sole discretion), the Company shall not (and shall cause each of its Subsidiaries and affiliates to not) disclose the name of such
Buyer in any filing, announcement, release or otherwise. Notwithstanding anything contained in this Agreement to the contrary and
without implication that the contrary would otherwise be true, the Company expressly acknowledges and agrees that no Buyer shall
have (unless expressly agreed to by a particular Buyer after the date hereof in a written definitive and binding agreement executed
by the Company and such particular Buyer (it being understood and agreed that no Buyer may bind any other Buyer with respect thereto)),
any duty of confidentiality with respect to, or a duty not to trade on the basis of, any material, non-public information regarding
the Company or any of its Subsidiaries. Each Buyer further acknowledges that the Company shall not be deemed to violate this Section
4(i) by disclosing the name of any Buyer that beneficially owns more than 4.99% of the Common Stock of the Company in accordance
with the disclosure made by such Buyer in any Schedule 13D or Schedule 13G filed by such Buyer with the SEC.


 






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(iii) Other
Confidential Information. Disclosure Failures; Disclosure Delay Payments. In addition to other remedies set forth in this Section
4(i), and without limiting anything set forth in any other Transaction Document, at any time after the Closing Date if the Company,
any of its Subsidiaries, or any of their respective officers, directors, employees or agents, provides any Buyer with material
non-public information relating to the Company or any of its Subsidiaries (each, the “Confidential Information”),
the Company shall, on or prior to the applicable Required Disclosure Date (as defined below), publicly disclose such Confidential
Information on a Report of Foreign Issuer on Form 6-K or otherwise (each, a “Disclosure”). From and after such
Disclosure, the Company shall have disclosed all Confidential Information provided to such Buyer by the Company or any of its Subsidiaries
or any of their respective officers, directors, employees or agents in connection with the transactions contemplated by the Transaction
Documents. In addition, effective upon such Disclosure, the Company acknowledges and agrees that any and all confidentiality or
similar obligations under any agreement, whether written or oral, between the Company, any of its Subsidiaries or any of their
respective officers, directors, affiliates, employees or agents, on the one hand, and any of the Buyers or any of their affiliates,
on the other hand, shall terminate. In the event that the Company fails to effect such Disclosure on or prior to the Required Disclosure
Date and such Buyer shall have possessed Confidential Information for at least ten (10) consecutive Trading Days (each, a “Disclosure
Failure”), then, as partial relief for the damages to such Buyer by reason of any such delay in, or reduction of, its
ability to buy or sell Ordinary Shares after such Required Disclosure Date (which remedy shall not be exclusive of any other remedies
available at law or in equity), the Company shall pay to such Buyer an amount in cash equal to the greater of (I) two percent (2%)
of the aggregate Purchase Price and (II) the applicable Disclosure Restitution Amount, on each of the following dates (each, a
“Disclosure Delay Payment Date”): (i) on the date of such Disclosure Failure and (ii) on every thirty (30) day
anniversary such Disclosure Failure until the earlier of (x) the date such Disclosure Failure is cured and (y) such time as all
such non-public information provided to such Buyer shall cease to be Confidential Information (as evidenced by a certificate, duly
executed by an authorized officer of the Company to the foregoing effect) (such earlier date, as applicable, a “Disclosure
Cure Date”). Following the initial Disclosure Delay Payment for any particular Disclosure Failure, without limiting the
foregoing, if a Disclosure Cure Date occurs prior to any thirty (30) day anniversary of such Disclosure Failure, then such Disclosure
Delay Payment (prorated for such partial month) shall be made on the second (2nd) Business Day after such Disclosure Cure Date.
The payments to which an Investor shall be entitled pursuant to this Section 4(l)(iii) are referred to herein as “Disclosure
Delay Payments.” In the event the Company fails to make Disclosure Delay Payments in a timely manner in accordance with
the foregoing, such Disclosure Delay Payments shall bear interest at the rate of two percent (2%) per month (prorated for partial
months) until paid in full.


 






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(iv) For
the purpose of this Agreement the following definitions shall apply:


 


(1) 
“Disclosure Failure Market Price” means, as of any Disclosure Delay Payment Date, the price computed as the
quotient of (I) the sum of the five (5) highest VWAPs (as defined in the Warrants) of the Ordinary Shares during the applicable
Disclosure Restitution Period (as defined below), divided by (II) five (5) (such period, the “Disclosure Failure Measuring
Period”). All such determinations to be appropriately adjusted for any share dividend, share split, share combination,
reclassification or similar transaction that proportionately decreases or increases the Ordinary Shares during such Disclosure
Failure Measuring Period.


 


(2) “Disclosure
Restitution Amount” means, as of any Disclosure Delay Payment Date, the product of (x) difference of (I) the Disclosure
Failure Market Price less (II) the lowest purchase price, per Ordinary Shares, of any Ordinary Shares issued or issuable to such
Buyer pursuant to this Agreement or any other Transaction Documents, multiplied by (y) 10% of the aggregate daily dollar trading
volume (as reported on Bloomberg (as defined in the Warrants)) of the Ordinary Shares on the Principal Market for each Trading
Day (as defined in the Warrants) either (1) with respect to the initial Disclosure Delay Payment Date, during the period commencing
on the applicable Required Disclosure Date through and including the Trading Day immediately prior to the initial Disclosure Delay
Payment Date or (2) with respect to each other Disclosure Delay Payment Date, during the period commencing the immediately preceding
Disclosure Delay Payment Date through and including the Trading Day immediately prior to such applicable Disclosure Delay Payment
Date (such applicable period, the “Disclosure Restitution Period”).


 






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(3) “Required
Disclosure Date” means (x) if such Buyer authorized the delivery of such Confidential Information, either (I) if the
Company and such Buyer have mutually agreed upon a date (as evidenced by an e-mail or other writing) of Disclosure of such Confidential
Information, such agreed upon date or (II) otherwise, the seventh (7th) calendar day after the date such Buyer first
received any Confidential Information or (y) if such Buyer did not authorize the delivery of such Confidential Information, the
first (1st) Business Day after such Buyer’s receipt of such Confidential Information.


 


(j) Additional
Registration Statements. Until the Applicable Date (as defined below) and at any
time thereafter while any Registration Statement is not effective or the prospectus contained therein is not available for use
or any Current Public Information Failure (as defined in the Registration Rights Agreement) exists, the Company shall not file
a registration statement or an offering statement under the 1933 Act relating to securities that are not the Registrable Securities
(other than a registration statement on Form F-8 or such supplements or amendments to registration statements that are outstanding
and have been declared effective by the SEC as of the date hereof (solely to the extent necessary to keep such registration statements
effective and available and not with respect to any Subsequent Placement)). “Applicable Date” means the earlier
of (x) the first date on which the resale by the Buyers of all the Registrable Securities required to be filed on the initial
Registration Statement (as defined in the Registration Rights Agreement) pursuant to the Registration Rights Agreement is declared
effective by the SEC (and each prospectus contained therein is available for use on such date) or (y) the first date on which
all of the Registrable Securities are eligible to be resold by the Buyers pursuant to Rule 144 (or, if a Current Public Information
Failure has occurred and is continuing, such later date after which the Company has cured such Current Public Information Failure).


 






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(k) Additional
Issuance of Securities. So long as any Buyer beneficially owns any Securities,
the Company will not, without the prior written consent of the Required Holders, issue any Notes (other than to the Buyers as
contemplated hereby) and the Company shall not issue any other securities that would cause a breach or default under the Notes
or the Warrants. The Company agrees that for the period commencing on the date hereof and ending on the date immediately following
the 180th calendar day after the Applicable Date (provided that such period shall be extended by the number of calendar
days during such period and any extension thereof contemplated by this proviso on which any Registration Statement is not effective
or any prospectus contained therein is not available for use or any Current Public Information Failure exists) (the “Restricted
Period”), neither the Company nor any of its Subsidiaries shall directly or indirectly issue, offer, sell, grant any
option or right to purchase, or otherwise dispose of (or announce any issuance, offer, sale, grant of any option or right to purchase
or other disposition of) any equity security or any equity-linked or related security (including, without limitation, any “equity
security” (as that term is defined under Rule 405 promulgated under the 1933 Act), any Convertible Securities (as defined
below), any debt, any preferred shares or any purchase rights) (any such issuance, offer, sale, grant, disposition or announcement
(whether occurring during the Restricted Period or at any time thereafter) is referred to as a “Subsequent Placement”).
Notwithstanding the foregoing, this Section 4(k) shall not apply in respect of the issuance of (i) Ordinary Shares or standard
options to purchase Ordinary Shares to directors, officers, employees or advisors of the Company in their capacity as such pursuant
to an Approved Share Plan (as defined below), provided that (1) all such issuances (taking into account the Ordinary Shares issuable
upon exercise of such options) after the date hereof pursuant to this clause (i) do not, in the aggregate, exceed more than 10%
of the Ordinary Shares issued and outstanding immediately prior to the date hereof and (2) the exercise price of any such options
is not lowered, none of such options are amended to increase the number of shares issuable thereunder and none of the terms or
conditions of any such options are otherwise materially changed in any manner that adversely affects any of the Buyers; (ii) Ordinary
Shares issued upon the conversion or exercise of Convertible Securities (other than standard options to purchase Ordinary Shares
issued pursuant to an Approved Share Plan that are covered by clause (i) above) issued prior to the date hereof, provided that
the conversion, exercise or other method of issuance (as the case may be) of any such Convertible Security is made solely pursuant
to the conversion, exercise or other method of issuance (as the case may be) provisions of such Convertible Security that were
in effect on the date immediately prior to the date of this Agreement, the conversion, exercise or issuance price of any such
Convertible Securities (other than standard options to purchase Ordinary Shares issued pursuant to an Approved Share Plan that
are covered by clause (i) above) is not lowered, none of such Convertible Securities (other than standard options to purchase
Ordinary Shares issued pursuant to an Approved Share Plan that are covered by clause (i) above) are amended to increase the number
of shares issuable thereunder and none of the terms or conditions of any such Convertible Securities (other than standard options
to purchase Ordinary Shares issued pursuant to an Approved Share Plan that are covered by clause (i) above) are otherwise materially
changed in any manner that adversely affects any of the Buyers; (iii) the Conversion Shares, (iv) the Warrant Shares and (v) any
shares of Common Stock issued or issuable in connection with any bona fide strategic or commercial alliances, acquisitions, mergers,
licensing arrangements, and strategic partnerships, provided, that (x) the primary purpose of such issuance is not to raise capital
as reasonably determined, and (y) the purchaser or acquirer or recipient of the securities in such issuance solely consists of
either (A) the actual participants in such strategic or commercial alliance, strategic or commercial licensing arrangement or
strategic or commercial partnership, (B) the actual owners of such assets or securities acquired in such acquisition or merger
or (C) the stockholders, partners, employees, consultants, officers, directors or members of the foregoing Persons, in each case,
which is, itself or through its subsidiaries, an operating company or an owner of an asset, in a business synergistic with the
business of the Company and shall provide to the Company additional benefits in addition to the investment of funds, and (z) the
number or amount of securities issued to such Persons by the Company shall not be disproportionate to each such Person’s
actual participation in (or fair market value of the contribution to) such strategic or commercial alliance or strategic or commercial
partnership or ownership of such assets or securities to be acquired by the Company, as applicable (each of the foregoing in clauses
(i) through (iv), collectively the “Excluded Securities”). “Approved Share Plan” means any
employee benefit plan which has been approved by the board of directors of the Company prior to or subsequent to the date hereof
pursuant to which Ordinary Shares and standard options to purchase Ordinary Shares may be issued to any employee, officer or director
for services provided to the Company in their capacity as such. “Convertible Securities” means any share capital
or other security of the Company or any of its Subsidiaries that is at any time and under any circumstances directly or indirectly
convertible into, exercisable or exchangeable for, or which otherwise entitles the holder thereof to acquire, any share capital
or other security of the Company (including, without limitation, Ordinary Shares) or any of its Subsidiaries.


 






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(l) Reservation
of Shares. So long as any of the Notes or Warrants remain outstanding, the Company
shall take all action necessary to at all times have authorized, and reserved for the purpose of issuance, no less than 200% of
(i) the maximum number of Ordinary Shares issuable upon conversion of all the Notes then outstanding (assuming for purposes hereof
that (x) the Notes are convertible at the Alternate Conversion Price assuming an Alternate Conversion Date as of the applicable
date of determination, (y) interest on the Notes shall accrue through October 2, 2020 and will be converted in Ordinary Shares
at a conversion price equal to the Alternate Conversion Price assuming an Alternate Conversion Date as of the applicable date
of determination and (z) any such conversion shall not take into account any limitations on the conversion of the Notes set forth
in the Notes), and (ii) the maximum number of Warrant Shares issuable upon exercise of all the Warrants then outstanding (without
regard to any limitations on the exercise of the Warrants set forth therein) (collectively, the “Required Reserve Amount”);
provided that at no time shall the number of Ordinary Shares reserved pursuant to this Section 4(l) be reduced other than proportionally
in connection with any conversion, exercise and/or redemption, as applicable of Notes and Warrants. If at any time the number
of Ordinary Shares authorized and reserved for issuance is not sufficient to meet the Required Reserve Amount, the Company will
promptly take all corporate action necessary to authorize and reserve a sufficient number of shares, including, without limitation,
calling a special meeting of shareholders to authorize additional shares to meet the Company's obligations pursuant to the Transaction
Documents, in the case of an insufficient number of authorized shares, obtain shareholder approval of an increase in such authorized
number of shares, and voting the management shares of the Company in favor of an increase in the authorized shares of the Company
to ensure that the number of authorized shares is sufficient to meet the Required Reserve Amount.


 


(m) Conduct
of Business. The business of the Company and its Subsidiaries shall not be conducted
in violation of any law, ordinance or regulation of any Governmental Entity, except where such violations would not reasonably
be expected to result, either individually or in the aggregate, in a Material Adverse Effect.


 


(n) Other
Notes; Variable Securities. So long as any Notes or Warrants remain outstanding,
the Company and each Subsidiary shall be prohibited from effecting or entering into an agreement to effect any Subsequent Placement
involving a Variable Rate Transaction. “Variable Rate Transaction” means a transaction in which the Company
or any Subsidiary (i) issues or sells any Convertible Securities either (A) at a conversion, exercise or exchange rate or other
price that is based upon and/or varies with the trading prices of or quotations for the Ordinary Shares at any time after the
initial issuance of such Convertible Securities, or (B) with a conversion, exercise or exchange price that is subject to being
reset at some future date after the initial issuance of such Convertible Securities or upon the occurrence of specified or contingent
events directly or indirectly related to the business of the Company or the market for the Ordinary Shares, other than pursuant
to a customary “weighted average” anti-dilution provision or (ii) enters into any agreement (including, without limitation,
an equity line of credit or an “at-the-market” offering) whereby the Company or any Subsidiary may sell securities
at a future determined price (other than standard and customary “preemptive” or “participation” rights).
Each Buyer shall be entitled to obtain injunctive relief against the Company and its Subsidiaries to preclude any such issuance,
which remedy shall be in addition to any right to collect damages.


 






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(o) Participation
Right. At any time on or prior to the second anniversary of the Closing Date, neither
the Company nor any of its Subsidiaries shall, directly or indirectly, effect any Subsequent Placement unless the Company shall
have first complied with this Section 4(o). The Company acknowledges and agrees that the right set forth in this Section 4(o)
is a right granted by the Company, separately, to each Buyer.


 


(i) At
least five (5) Trading Days prior to any proposed or intended Subsequent Placement, the Company shall deliver to each Buyer a written
notice (each such notice, a “Pre-Notice”), which Pre-Notice shall not contain any information (including, without
limitation, material, non-public information) other than: (A) if the proposed Offer Notice (as defined below) constitutes or contains
material, non-public information, a statement asking whether the Investor is willing to accept material non-public information
or (B) if the proposed Offer Notice does not constitute or contain material, non-public information, (x) a statement that the Company
proposes or intends to effect a Subsequent Placement, (y) a statement that the statement in clause (x) above does not constitute
material, non-public information and (z) a statement informing such Buyer that it is entitled to receive an Offer Notice (as defined
below) with respect to such Subsequent Placement upon its written request. Upon the written request of a Buyer within three (3)
Trading Days after the Company’s delivery to such Buyer of such Pre-Notice, and only upon a written request by such Buyer,
the Company shall promptly, but no later than one (1) Trading Day after such request, deliver to such Buyer an irrevocable written
notice (the “Offer Notice”) of any proposed or intended issuance or sale or exchange (the “Offer”)
of the securities being offered (the “Offered Securities”) in a Subsequent Placement, which Offer Notice shall
(A) identify and describe the Offered Securities, (B) describe the price and other terms upon which they are to be issued, sold
or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (C) identify the Persons (if
known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (D) offer to issue and sell
to or exchange with such Buyer in accordance with the terms of the Offer such Buyer’s pro rata portion of 30% of the Offered
Securities, provided that the number of Offered Securities which such Buyer shall have the right to subscribe for under this Section
4(o) shall be (x) based on such Buyer’s pro rata portion of the aggregate original principal amount of the Notes purchased
hereunder by all Buyers (the “Basic Amount”), and (y) with respect to each Buyer that elects to purchase its
Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Buyers as such Buyer
shall indicate it will purchase or acquire should the other Buyers subscribe for less than their Basic Amounts (the “Undersubscription
Amount”), which process shall be repeated until each Buyer shall have an opportunity to subscribe for any remaining Undersubscription
Amount.


 






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(ii) To
accept an Offer, in whole or in part, such Buyer must deliver a written notice to the Company prior to the end of the fifth (5th)
Business Day after such Buyer’s receipt of the Offer Notice (the “Offer Period”), setting forth the portion
of such Buyer’s Basic Amount that such Buyer elects to purchase and, if such Buyer shall elect to purchase all of its Basic
Amount, the Undersubscription Amount, if any, that such Buyer elects to purchase (in either case, the “Notice of Acceptance”).
If the Basic Amounts subscribed for by all Buyers are less than the total of all of the Basic Amounts, then each Buyer who has
set forth an Undersubscription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts
subscribed for, the Undersubscription Amount it has subscribed for; provided, however, if the Undersubscription Amounts subscribed
for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the “Available
Undersubscription Amount”), each Buyer who has subscribed for any Undersubscription Amount shall be entitled to purchase
only that portion of the Available Undersubscription Amount as the Basic Amount of such Buyer bears to the total Basic Amounts
of all Buyers that have subscribed for Undersubscription Amounts, subject to rounding by the Company to the extent it deems reasonably
necessary. Notwithstanding the foregoing, if the Company desires to modify or amend the terms and conditions of the Offer prior
to the expiration of the Offer Period, the Company may deliver to each Buyer a new Offer Notice and the Offer Period shall expire
on the fifth (5th) Business Day after such Buyer’s receipt of such new Offer Notice.


 


(iii) The
Company shall have five (5) Business Days from the expiration of the Offer Period above (A) to offer, issue, sell or exchange all
or any part of such Offered Securities as to which a Notice of Acceptance has not been given by a Buyer (the “Refused
Securities”) pursuant to a definitive agreement(s) (the “Subsequent Placement Agreement”), but only
to the offerees described in the Offer Notice (if so described therein) and only upon terms and conditions (including, without
limitation, unit prices and interest rates) that are not more favorable to the acquiring Person or Persons or less favorable to
the Company than those set forth in the Offer Notice and (B) to publicly announce (x) the execution of such Subsequent Placement
Agreement, and (y) either (I) the consummation of the transactions contemplated by such Subsequent Placement Agreement or (II)
the termination of such Subsequent Placement Agreement, which shall be filed with the SEC on a Report of Foreign Issuer on Form
6-K with such Subsequent Placement Agreement and any documents contemplated therein filed as exhibits thereto.


 


(iv) In
the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the
terms specified in Section 4(o)(iii) above), then each Buyer may, at its sole option and in its sole discretion, withdraw
its Notice of Acceptance or reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount
that shall be not less than the number or amount of the Offered Securities that such Buyer elected to purchase pursuant to Section 4(o)(ii)
above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually
proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Buyers pursuant to this Section 4(o)
prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event
that any Buyer so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company
may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities
have again been offered to the Buyers in accordance with Section 4(o)(i) above.


 






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(v) Upon
the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, such Buyer shall acquire from
the Company, and the Company shall issue to such Buyer, the number or amount of Offered Securities specified in its Notice of Acceptance,
as reduced pursuant to Section 4(o)(iv) above if such Buyer has so elected, upon the terms and conditions specified in the
Offer. The purchase by such Buyer of any Offered Securities is subject in all cases to the preparation, execution and delivery
by the Company and such Buyer of a separate purchase agreement relating to such Offered Securities reasonably satisfactory in form
and substance to such Buyer and its counsel.


 


(vi) Any
Offered Securities not acquired by a Buyer or other Persons in accordance with this Section 4(o) may not be issued, sold or
exchanged until they are again offered to such Buyer under the procedures specified in this Agreement.


 


(vii) The
Company and each Buyer agree that if any Buyer elects to participate in the Offer, (x) neither the Subsequent Placement Agreement
with respect to such Offer nor any other transaction documents related thereto (collectively, the “Subsequent Placement
Documents”) shall include any term or provision whereby such Buyer shall be required to agree to any restrictions on
trading as to any securities of the Company or be required to consent to any amendment to or termination of, or grant any waiver,
release or the like under or in connection with, any agreement previously entered into with the Company or any instrument received
from the Company, and (y) any registration rights set forth in such Subsequent Placement Documents shall be similar in all material
respects to the registration rights contained in the Registration Rights Agreement.


 


(viii) Notwithstanding
anything to the contrary in this Section 4(o) and unless otherwise agreed to by such Buyer, the Company shall either confirm in
writing to such Buyer that the transaction with respect to the Subsequent Placement has been abandoned or shall publicly disclose
its intention to issue the Offered Securities, in either case, in such a manner such that such Buyer will not be in possession
of any material, non-public information, by the fifth (5th) Business Day following delivery of the Offer Notice. If
by such fifth (5th) Business Day, no public disclosure regarding a transaction with respect to the Offered Securities
has been made, and no notice regarding the abandonment of such transaction has been received by such Buyer, such transaction shall
be deemed to have been abandoned and such Buyer shall not be in possession of any material, non-public information with respect
to the Company or any of its Subsidiaries. Should the Company decide to pursue such transaction with respect to the Offered Securities,
the Company shall provide such Buyer with another Offer Notice and such Buyer will again have the right of participation set forth
in this Section 4(o). The Company shall not be permitted to deliver more than one such Offer Notice to such Buyer in any sixty
(60) day period, except as expressly contemplated by the last sentence of Section 4(o)(ii).


 


(ix) The
restrictions contained in this Section 4(o) shall not apply in connection with the issuance of any Excluded Securities. The Company
shall not circumvent the provisions of this Section 4(o) by providing terms or conditions to one Buyer that are not provided to
all.


 






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(p) Dilutive
Issuances. For so long as any Notes or Warrants remain outstanding, the Company
shall not, in any manner, enter into or affect any Dilutive Issuance (as defined in the Notes) if the effect of such Dilutive
Issuance is to cause the Company to be required to issue upon conversion of any Notes or exercise of any Warrant any Ordinary
Shares in excess of that number of Ordinary Shares which the Company may issue upon conversion of the Notes and exercise of the
Warrants without breaching the Company’s obligations under the rules or regulations of the Principal Market.


 


(q) Passive
Foreign Investment Company. The Company shall conduct its business, and shall cause
its Subsidiaries to conduct their respective businesses, in such a manner as will ensure that the Company will not be deemed to
constitute a passive foreign investment company within the meaning of Section 1297 of the Code.


 


(r) Restriction
on Redemption and Cash Dividends. So long as any Notes are outstanding, the Company
shall not, directly or indirectly, redeem, or declare or pay any cash dividend or distribution on, any securities of the Company
without the prior express written consent of the Buyers.


 


(s) Corporate
Existence. So long as any Buyer beneficially owns any Notes or Warrants, the Company
shall not be party to any Fundamental Transaction (as defined in the Notes) unless the Company is in compliance with the applicable
provisions governing Fundamental Transactions set forth in the Notes and the Warrants.


 


(t) Share
splits. Until the Notes and all notes issued pursuant to the terms thereof are
no longer outstanding, the Company shall not effect any share combination, reverse share split or other similar transaction (or
make any public announcement or disclosure with respect to any of the foregoing) without the prior written consent of the Required
Holders (as defined below).


 


(u) Conversion
and Exercise Procedures. Each of the form of Exercise Notice (as defined in the Warrants) included in the Warrants and the
form of Conversion Notice (as defined in the Notes) included in the Notes set forth the totality of the procedures required of
the Buyers in order to exercise the Warrants or convert the Notes. Except as provided in Section 5(d), no additional legal opinion,
other information or instructions shall be required of the Buyers to exercise their Warrants or convert their Notes. The Company
shall honor exercises of the Warrants and conversions of the Notes and shall deliver the Conversion Shares and Warrant Shares in
accordance with the terms, conditions and time periods set forth in the Notes and Warrants.


 


(v) Regulation
M. The Company will not take any action prohibited by Regulation M under the 1934
Act, in connection with the distribution of the Securities contemplated hereby.


 


(w) General
Solicitation. None of the Company, any of its affiliates (as defined in Rule 501(b) under the 1933 Act) or any person acting
on behalf of the Company or such affiliate will solicit any offer to buy or offer or sell the Securities by means of any form
of general solicitation or general advertising within the meaning of Regulation D, including: (i) any advertisement, article,
notice or other communication published in any newspaper, magazine or similar medium or broadcast over television or radio; and
(ii) any seminar or meeting whose attendees have been invited by any general solicitation or general advertising.


 






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(x) Integration.
None of the Company, any of its affiliates (as defined in Rule 501(b) under the 1933 Act), or any person acting on behalf of the
Company or such affiliate will sell, offer for sale, or solicit offers to buy or otherwise negotiate in respect of any security
(as defined in the 1933 Act) which will be integrated with the sale of the Securities in a manner which would require the registration
of the Securities under the 1933 Act or require shareholder approval under the rules and regulations of the Principal Market and
the Company will take all action that is appropriate or necessary to assure that its offerings of other securities will not be
integrated for purposes of the 1933 Act or the rules and regulations of the Principal Market, with the issuance of Securities
contemplated hereby.


 


(y) Notice
of Disqualification Events. The Company will notify the Buyers in writing, prior
to the Closing Date of (i) any Disqualification Event relating to any Issuer Covered Person and (ii) any event that would, with
the passage of time, become a Disqualification Event relating to any Issuer Covered Person.


 


(z) Closing
Documents. On or prior to thirty (30) calendar days after the Closing Date, the
Company agrees to deliver, or cause to be delivered, to each Buyer and Kelley Drye & Warren LLP a complete closing set of
the executed Transaction Documents, Securities and any other document required to be delivered to any party pursuant to Section 7
hereof or otherwise.


 


5. REGISTER;
TRANSFER AGENT INSTRUCTIONS; LEGEND.


 


(a) Register.
The Company shall maintain at its principal executive offices (or such other office or agency of the Company as it may designate
by notice to each holder of Securities), a register for the Notes and the Warrants in which the Company shall record the name
and address of the Person in whose name the Notes and the Warrants have been issued (including the name and address of each transferee),
the principal amount of the Notes held by such Person, the number of Conversion Shares issuable pursuant to the terms of the Notes
and the number of Warrant Shares issuable upon exercise of the Warrants held by such Person. The Company shall keep the register
open and available at all times during business hours for inspection of any Buyer or its legal representatives.


 


(b) Transfer
Agent Instructions. The Company shall issue irrevocable instructions to its transfer
agent and any subsequent transfer agent (as applicable, the “Transfer Agent”) in a form acceptable to each
of the Buyers (the “Irrevocable Transfer Agent Instructions”) to issue certificates or credit shares to the
applicable balance accounts at The Depository Trust Company (“DTC”), registered in the name of each Buyer or
its respective nominee(s), for the Conversion Shares and the Warrant Shares in such amounts as specified from time to time by
each Buyer to the Company upon conversion of the Notes or the exercise of the Warrants (as the case may be). The Company represents
and warrants that no instruction other than the Irrevocable Transfer Agent Instructions referred to in this Section 5(b),
and stop transfer instructions to give effect to Section 2(g) hereof, will be given by the Company to its transfer agent with
respect to the Securities, and that the Securities shall otherwise be freely transferable on the books and records of the Company,
as applicable, to the extent provided in this Agreement and the other Transaction Documents. If a Buyer effects a sale, assignment
or transfer of the Securities in accordance with Section 2(g), the Company shall permit the transfer and shall promptly instruct
its transfer agent to issue one or more certificates or credit shares to the applicable balance accounts at DTC in such name and
in such denominations as specified by such Buyer to effect such sale, transfer or assignment. In the event that such sale, assignment
or transfer involves Conversion Shares or Warrant Shares sold, assigned or transferred pursuant to an effective registration statement
or in compliance with Rule 144, the transfer agent shall issue such shares to such Buyer, assignee or transferee (as the case
may be) without any restrictive legend in accordance with Section 5(d) below. The Company acknowledges that a breach by it
of its obligations hereunder will cause irreparable harm to a Buyer. Accordingly, the Company acknowledges that the remedy at
law for a breach of its obligations under this Section 5(b) will be inadequate and agrees, in the event of a breach or threatened
breach by the Company of the provisions of this Section 5(b), that a Buyer shall be entitled, in addition to all other available
remedies, to an order and/or injunction restraining any breach and requiring immediate issuance and transfer, without the necessity
of showing economic loss and without any bond or other security being required. The Company shall cause its counsel to issue the
legal opinion referred to in the Irrevocable Transfer Agent Instructions to the Company’s transfer agent on each Effective
Date (as defined in the Registration Rights Agreement). Any fees (with respect to the transfer agent, counsel to the Company or
otherwise) associated with the issuance of such opinion or the removal of any legends on any of the Securities shall be borne
by the Company.


 






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(c) Legends.
Each Buyer understands that the Securities have been issued (or will be issued in the case of the Conversion Shares and the Warrant
Shares) pursuant to an exemption from registration or qualification under the 1933 Act and applicable state securities laws, and
except as set forth below, the Securities shall bear any legend as required by the “blue sky” laws of any state and
a restrictive legend in substantially the following form (and a stop-transfer order may be placed against transfer of such share
certificates):


 


[NEITHER THE ISSUANCE AND SALE OF THE
SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE [CONVERTIBLE] [EXERCISABLE] HAVE
BEEN][THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN] REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE
OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF
COUNSEL TO THE HOLDER (IF REQUESTED BY THE COMPANY), IN A FORM REASONABLY ACCEPTABLE TO THE COMPANY, THAT REGISTRATION IS NOT REQUIRED
UNDER SAID ACT OR (II) UNLESS SOLD OR ELIGIBLE TO BE SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT. NOTWITHSTANDING THE
FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED
BY THE SECURITIES.


 






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(d) Removal
of Legends. Certificates evidencing Securities shall not be required to contain
the legend set forth in Section 5(c) above or any other legend (i) while a registration statement (including a Registration
Statement) covering the resale of such Securities is effective under the 1933 Act, (ii) following any sale of such Securities
pursuant to Rule 144 (assuming the transferor is not an affiliate of the Company), (iii) if such Securities are eligible to be
sold, assigned or transferred under Rule 144 (provided that a Buyer provides the Company with reasonable assurances that such
Securities are eligible for sale, assignment or transfer under Rule 144 which shall not include an opinion of Buyer’s counsel),
(iv) in connection with a sale, assignment or other transfer (other than under Rule 144), provided that such Buyer provides the
Company with an opinion of counsel to such Buyer, in a generally acceptable form, to the effect that such sale, assignment or
transfer of the Securities may be made without registration under the applicable requirements of the 1933 Act or (v) if such legend
is not required under applicable requirements of the 1933 Act (including, without limitation, controlling judicial interpretations
and pronouncements issued by the SEC). If a legend is not required pursuant to the foregoing, the Company shall no later than
two (2) Trading Days (or such earlier date as required pursuant to the 1934 Act or other applicable law, rule or regulation for
the settlement of a trade initiated on the date such Buyer delivers such legended certificate representing such Securities to
the Company) following the delivery by a Buyer to the Company or the transfer agent (with notice to the Company) of a legended
certificate representing such Securities (endorsed or with share powers attached, signatures guaranteed, and otherwise in form
necessary to affect the reissuance and/or transfer, if applicable), together with any other deliveries from such Buyer as may
be required above in this Section 5(d), as directed by such Buyer, either: (A) provided that the Company’s transfer
agent is participating in the DTC Fast Automated Securities Transfer Program and such Securities are Conversion Shares or Warrant
Shares, credit the aggregate number of Ordinary Shares to which such Buyer shall be entitled to such Buyer’s or its designee’s
balance account with DTC through its Deposit/Withdrawal at Custodian system or (B) if the Company’s transfer agent is not
participating in the DTC Fast Automated Securities Transfer Program, issue and deliver (via reputable overnight courier) to such
Buyer, a certificate representing such Securities that is free from all restrictive and other legends, registered in the name
of such Buyer or its designee (the date by which such credit is so required to be made to the balance account of such Buyer’s
or such Buyer’s designee with DTC or such certificate is required to be delivered to such Buyer pursuant to the foregoing
is referred to herein as the “Required Delivery Date”, and the date such Ordinary Shares are actually delivered
without restrictive legend to such Buyer or such Buyer’s designee with DTC, as applicable, the “Share Delivery
Date”). The Company shall be responsible for any transfer agent fees or DTC fees with respect to any issuance of Securities
or the removal of any legends with respect to any Securities in accordance herewith.


 






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(e) Failure
to Timely Deliver; Buy-In. If the Company fails to fail, for any reason or for
no reason, to issue and deliver (or cause to be delivered) to a Buyer (or its designee) by the Required Delivery Date, either
(I) if the Transfer Agent is not participating in the DTC Fast Automated Securities Transfer Program, a certificate for the number
of Conversion Shares or Warrant Shares (as the case may be) to which such Buyer is entitled and register such Conversion Shares
or Warrant Shares (as the case may be) on the Company’s share register or, if the Transfer Agent is participating in the
DTC Fast Automated Securities Transfer Program, to credit the balance account of such Buyer or such Buyer’s designee with
DTC for such number of Conversion Shares or Warrant Shares (as the case may be) submitted for legend removal by such Buyer pursuant
to Section 5(d) above or (II) if the Registration Statement covering the resale of the Conversion Shares or Warrant Shares (as
the case may be) submitted for legend removal by such Buyer pursuant to Section 5(d) above (the “Unavailable Shares”)
is not available for the resale of such Unavailable Shares and the Company fails to promptly, but in no event later than as required
pursuant to the Registration Rights Agreement (x) so notify such Buyer and (y) deliver the Conversion Shares or Warrant Shares,
as applicable, electronically without any restrictive legend by crediting such aggregate number of Conversion Shares or Warrant
Shares (as the case may be) submitted for legend removal by such Buyer pursuant to Section 5(d) above to such Buyer’s or
its designee’s balance account with DTC through its Deposit/Withdrawal At Custodian system (the event described in the immediately
foregoing clause (II) is hereinafter referred as a “Notice Failure” and together with the event described in
clause (I) above, a “Delivery Failure”), then, in addition to all other remedies available to such Buyer, the
Company shall pay in cash to such Buyer on each day after the Share Delivery Date and during such Delivery Failure an amount equal
to 2% of the product of (A) the sum of the number of Ordinary Shares not issued to such Buyer on or prior to the Required Delivery
Date and to which such Buyer is entitled, and (B) any trading price of the Ordinary Shares selected by such Buyer in writing as
in effect at any time during the period beginning on the date of the delivery by such Buyer to the Company of the applicable Conversion
Shares or Warrant Shares (as the case may be) and ending on the applicable Share Delivery Date. In addition to the foregoing,
if on or prior to the Required Delivery Date either (I) if the Transfer Agent is not participating in the DTC Fast Automated Securities
Transfer Program, the Company shall fail to issue and deliver a certificate to a Buyer and register such Ordinary Shares on the
Company's share register or, if the Transfer Agent is participating in the DTC Fast Automated Securities Transfer Program, credit
the balance account of such Buyer or such Buyer’s designee with DTC for the number of Ordinary Shares to which such Buyer
submitted for legend removal by such Buyer pursuant to Section 5(d) above (ii) below or (II) a Notice Failure occurs, and if on
or after such Trading Day such Buyer purchases (in an open market transaction or otherwise) Ordinary Shares to deliver in satisfaction
of a sale by such Buyer of Ordinary Shares submitted for legend removal by such Buyer pursuant to Section 5(d) above that such
Buyer is entitled to receive from the Company (a “Buy-In”), then the Company shall, within two (2) Trading
Days after such Buyer’s request and in such Buyer’s discretion, either (i) pay cash to such Buyer in an amount equal
to such Buyer’s total purchase price (including brokerage commissions and other out-of-pocket expenses, if any, for the
Ordinary Shares so purchased) (the “Buy-In Price”), at which point the Company’s obligation to so deliver
such certificate or credit such Buyer’s balance account shall terminate and such shares shall be cancelled, or (ii) promptly
honor its obligation to so deliver to such Buyer a certificate or certificates or credit the balance account of such Buyer or
such Buyer’s designee with DTC representing such number of Ordinary Shares that would have been so delivered if the Company
timely complied with its obligations hereunder and pay cash to such Buyer in an amount equal to the excess (if any) of the Buy-In
Price over the product of (A) such number of shares of Conversion Shares or Warrant Shares (as the case may be) that the Company
was required to deliver to such Buyer by the Required Delivery Date multiplied by (B) the lowest Closing Sale Price (as defined
in the Warrants) of the Ordinary Shares on any Trading Day during the period commencing on the date of the delivery by such Buyer
to the Company of the applicable Conversion Shares or Warrant Shares (as the case may be) and ending on the date of such delivery
and payment under this clause (ii). Nothing shall limit such Buyer’s right to pursue any other remedies available to it
hereunder, at law or in equity, including, without limitation, a decree of specific performance and/or injunctive relief with
respect to the Company’s failure to timely deliver certificates representing Ordinary Shares (or to electronically deliver
such Ordinary Shares) as required pursuant to the terms hereof. Notwithstanding anything herein to the contrary, with respect
to any given Notice Failure and/or Delivery Failure, this Section 5(e) shall not apply to the applicable Buyer the extent the
Company has already paid such amounts in full to such Buyer with respect to such Notice Failure and/or Delivery Failure, as applicable,
pursuant to the analogous sections of the Note or Warrant, as applicable, held by such Buyer.


 


(f) FAST
Compliance. While any Warrants remain outstanding, the Company shall maintain a transfer agent that participates in the DTC
Fast Automated Securities Transfer Program.


 






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6. 
CONDITIONS TO THE COMPANY’S OBLIGATION TO SELL.


 


(a) 
The obligation of the Company hereunder to issue and sell the Notes and the related Warrants to each Buyer at the Closing
is subject to the satisfaction, at or before the Closing Date, of each of the following conditions, provided that these conditions
are for the Company’s sole benefit and may be waived by the Company at any time in its sole discretion by providing each
Buyer with prior written notice thereof: 


 


(i) 
Such Buyer shall have duly executed and delivered to the Company an Investor Collateral Certificate and, at the Company’s
direction, an Investor Note to such Buyer, in its capacity as the holder of the corresponding Series B Note, in such original principal
amount as is set forth across from such Buyer’s name in column (9) of the Schedule of Buyers.


 


(ii) 
Such Buyer shall have executed each of the other Transaction Documents to which it is a party and delivered the same to
the Company.


 


(iii) 
Such Buyer and each other Buyer shall have delivered to the Company the Purchase Price (less, in the case of any Buyer,
the amounts withheld pursuant to Section 4(g)) for the Note and the related Warrants being purchased by such Buyer at the
Closing by wire transfer of immediately available funds in accordance with the Flow of Funds Letter.


 


(iv) 
The representations and warranties of such Buyer shall be true and correct in all material respects as of the date when
made and as of the Closing Date as though originally made at that time (except for representations and warranties that speak as
of a specific date, which shall be true and correct as of such specific date), and such Buyer shall have performed, satisfied and
complied in all material respects with the covenants, agreements and conditions required by this Agreement to be performed, satisfied
or complied with by such Buyer at or prior to the Closing Date.


 


7. 
CONDITIONS TO EACH BUYER’S OBLIGATION TO PURCHASE.


 


(a) 
The obligation of each Buyer hereunder to purchase its Note and its related Warrants at the Closing is subject to the satisfaction,
at or before the Closing Date, of each of the following conditions, provided that these conditions are for each Buyer’s sole
benefit and may be waived by such Buyer at any time in its sole discretion by providing the Company with prior written notice thereof: 


 


(i) 
The Company and each Subsidiary (as the case may be) shall have duly executed and delivered to such Buyer each of the Transaction
Documents to which it is a party and the Company shall have duly executed and delivered to such Buyer (A) a Series A Note in such
original principal amount as is set forth across from such Buyer’s name in column (3) of the Schedule of Buyers, (B) a Series
B Note in the aggregate original principal amount as is set forth opposite such Buyer’s name in column (4) on the Schedule
of Buyers, (C) a Series A Warrant initially exercisable for such aggregate number of Series A Warrant Shares as is set forth across
from such Buyer’s name in column (5) of the Schedule of Buyers and (D) a Series B Warrant initially exercisable for such
aggregate number of Series B Warrant Shares as is set forth across from such Buyer’s name in column (6) of the Schedule of
Buyers, in each case, as being purchased by such Buyer at the Closing pursuant to this Agreement.


 






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(ii) 
Such Buyer shall have received the opinions of Campbells, the Company’s special British Virgin Islands counsel and
Hunter Taubman Fischer & Li LLC, the Company’s counsel, dated as of the Closing Date, in the form acceptable to such
Buyer.


 


(iii) 
The Company shall have delivered to such Buyer a copy of the Irrevocable Transfer Agent Instructions, in the form acceptable
to such Buyer, which instructions shall have been delivered to and acknowledged in writing by the Company’s transfer agent.


 


(iv) 
The Company shall have delivered to such Buyer a certificate evidencing the formation and good standing of the Company with
the Registry of Corporate Affairs of the British Virgin Islands Financial Services Commission


 


(v) 
 The Company shall have delivered to such Buyer a certified copy of the Articles of Association as certified by the Registry
of Corporate Affairs of the British Virgin Islands Financial Services Commission within ten (10) days of the Closing Date.


 


(vi) 
The Company and each Subsidiary shall have delivered to such Buyer a certificate, in the form acceptable to such Buyer,
executed by the Secretary of the Company and dated as of the Closing Date, as to (i) the resolutions consistent with Section 3(b)
as adopted by the Company’s board of directors in a form reasonably acceptable to such Buyer, (ii) the Articles of Association
of the Company and (iii) the Memorandum of Association of the Company, each as in effect at the Closing.


 


(vii) 
Each and every representation and warranty of the Company shall be true and correct as of the date when made and as of the
Closing Date as though originally made at that time (except for representations and warranties that speak as of a specific date,
which shall be true and correct as of such specific date) and the Company shall have performed, satisfied and complied in all respects
with the covenants, agreements and conditions required to be performed, satisfied or complied with by the Company at or prior to
the Closing Date. Such Buyer shall have received a certificate, duly executed by the Chief Executive Officer of the Company, dated
as of the Closing Date, to the foregoing effect and as to such other matters as may be reasonably requested by such Buyer in the
form acceptable to such Buyer.


 






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(viii) 
The Company shall have delivered to such Buyer a letter from the Company’s transfer agent certifying the number of
Ordinary Shares outstanding on the Closing Date immediately prior to the Closing.


 


(ix) 
The Ordinary Shares (A) shall be designated for quotation or listed (as applicable) on the Principal Market and (B) shall
not have been suspended, as of the Closing Date, by the SEC or the Principal Market from trading on the Principal Market nor shall
suspension by the SEC or the Principal Market have been threatened, as of the Closing Date, either (I) in writing by the SEC or
the Principal Market or (II) by falling below the minimum maintenance requirements of the Principal Market.


 


(x) 
The Company shall have obtained all governmental, regulatory or third party consents and approvals, if any, necessary for
the sale of the Securities, including without limitation, those required by the Principal Market, if any.


 


(xi) 
No statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated
or endorsed by any court or Governmental Entity of competent jurisdiction that prohibits the consummation of any of the transactions
contemplated by the Transaction Documents.


 


(xii) 
Since the date of execution of this Agreement, no event or series of events shall have occurred that reasonably would have
or result in a Material Adverse Effect.


 


(xiii) 
The Company shall have obtained approval of the Principal Market to list or designate for quotation (as the case may be)
the Conversion Shares and the Warrant Shares.


 


(xiv) 
 Within two (2) Business Days prior to the Closing, the Company shall have delivered or caused to be delivered to each Buyer
certified copies of requests for copies of information on Form UCC-11, listing all effective financing statements which name as
debtor the Company and which are filed in the District of Columbia, together with copies of such financing statements, none of
which shall cover any of the Collateral (as defined in the Series B Notes), and the results of searches for any tax Lien and judgment
Lien filed against the Company or its property, which results, except as otherwise agreed to in writing by the Buyers, shall not
show any such Liens.


 


(xv) 
Such Buyer shall have received a letter on the letterhead of the Company (the “Flow of Funds Letter”)
(x) duly executed by the Chief Executive Officer of the Company, setting forth the wire amounts of each Buyer and the wire transfer
instructions of the Company and (y) directing each Buyer (or its designee) to maintain physical possession of a duly executed Investor
Note of such Buyer, in such original principal amount as is set forth across from such Buyer’s name in column (9) of the
Schedule of Buyers, issued pursuant to the Note Purchase Agreement of such Buyer, both as payment for, and as Collateral (as defined
in such Buyer’s Series B Note) securing, such Buyer’s Series B Note to be issued and sold to such Buyer at the Closing.


 


(xvi) 
The Company shall have directed each Buyer to deliver such Buyer’s Investor Note to such Buyer, in its capacity as
a holder of the corresponding Series B Note, and such Buyer, in its capacity as a holder of the corresponding Series B Note, shall
have physical possession of each Investor Note at the Closing.


 






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(xvii) 
The Pledge Agreement shall have been executed and delivered to such Buyer by the Principal Shareholder, the Company and
the other Buyers.


 


(xviii) 
The Company shall deliver, or cause to be delivered, to each Buyer an opinion of a legal counsel licensed to practice law
in the jurisdiction of organization of the Principal Shareholder, with respect to the transfer of the shares pledged pursuant to
the Pledge Agreement to the Buyers which opinion and legal counsel shall be reasonably satisfactory to the Buyers and dated as
of the date of delivery of such legal opinion to the Buyers.


 


(xix) 
The Company shall deliver, or cause to be delivered, to each Buyer a certificate with respect to the Pledged Shares (as
defined in the Pledge Agreement) to be held by each such Buyer duly manually endorsed for transfer on the back of the share certificate
or on a share power to be attached to such share certificate, in each case duly executed in the name that appears on the face of
such certificate, including a Medallion Guarantee stamp placed below the signature on the back of such certificate or below the
signature on any accompanying share power or such other procedures as may be acceptable to the Transfer Agent to effect a transfer
(as verified by the Transfer Agent in writing (which may be an e-mail) to such Buyer prior to the Closing Date).


 


(xx) 
The Principal Stockholder shall have duly executed and delivered an irrevocable Stockholder Consent to the Company, in form
and substance reasonably satisfactory to such Buyer, representing the consent of more than 51% of the Ordinary Shares of all shareholders
of the Company.


 


(xxi) 
The Company and its Subsidiaries shall have delivered to such Buyer such other documents, instruments or certificates relating
to the transactions contemplated by this Agreement as such Buyer or its counsel may reasonably request.


 


8. 
TERMINATION.


 


In the event that the
Closing shall not have occurred with respect to a Buyer within five (5) days of the date hereof, then such Buyer shall have the
right to terminate its obligations under this Agreement with respect to itself at any time on or after the close of business on
such date without liability of such Buyer to any other party; provided, however, (i) the right to terminate this Agreement under
this Section 8 shall not be available to such Buyer if the failure of the transactions contemplated by this Agreement to have
been consummated by such date is the result of such Buyer’s breach of this Agreement and (ii) the abandonment of the sale
and purchase of the Notes and the Warrants shall be applicable only to such Buyer providing such written notice, provided further
that no such termination shall affect any obligation of the Company under this Agreement to reimburse such Buyer for the expenses
described in Section 4(g) above. Nothing contained in this Section 8 shall be deemed to release any party from any liability
for any breach by such party of the terms and provisions of this Agreement or the other Transaction Documents or to impair the
right of any party to compel specific performance by any other party of its obligations under this Agreement or the other Transaction
Documents.


 






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9. 
MISCELLANEOUS.


 


(a) 
Governing Law; Jurisdiction; Jury Trial. All questions concerning the construction, validity, enforcement and interpretation
of this Agreement shall be governed by the internal laws of the State of New York, without giving effect to any choice of law or
conflict of law provision or rule (whether of the State of New York or any other jurisdictions) that would cause the application
of the laws of any jurisdictions other than the State of New York. The Company hereby irrevocably submits to the exclusive jurisdiction
of the state and federal courts sitting in The City of New York, Borough of Manhattan, for the adjudication of any dispute hereunder
or in connection herewith or under any of the other Transaction Documents or with any transaction contemplated hereby or thereby,
and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally
subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an inconvenient forum or that
the venue of such suit, action or proceeding is improper. Each party hereby irrevocably waives personal service of process and
consents to process being served in any such suit, action or proceeding by mailing a copy thereof to such party at the address
for such notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process
and notice thereof. The Company hereby appoints Joan Wu, Esq of Hunter Taubman Fischer & Li LLC as its agent for service of
process in New York. Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted
by law. Nothing contained herein shall be deemed or operate to preclude any Buyer from bringing suit or taking other legal action
against the Company in any other jurisdiction to collect on the Company’s obligations to such Buyer or to enforce a judgment
or other court ruling in favor of such Buyer. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE TO, AND AGREES NOT
TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR UNDER ANY OTHER TRANSACTION DOCUMENT OR IN CONNECTION
WITH OR ARISING OUT OF THIS AGREEMENT, ANY OTHER TRANSACTION DOCUMENT OR ANY TRANSACTION CONTEMPLATED HEREBY OR THEREBY. The
choice of the laws of the State of New York as the governing law of this Agreement is a valid choice of law and would be recognized
and given effect to in any action brought before a court of competent jurisdiction in the British Virgin Islands, except for those
laws (i) which such court considers to be procedural in nature, (ii) which are revenue or penal laws or (iii) the application of
which would be inconsistent with public policy, as such term is interpreted under the laws of the British Virgin Islands. The choice
of laws of the State of New York as the governing law of this Agreement will be honored by competent courts in the People’s
Republic of China, subject to compliance with relevant People’s Republic of China civil procedural requirements. The Company
or any of their respective properties, assets or revenues does not have any right of immunity under British Virgin Islands, the
People’s Republic of China or New York law, from any legal action, suit or proceeding, from the giving of any relief in any
such legal action, suit or proceeding, from set-off or counterclaim, from the jurisdiction of any British Virgin Islands and the
People’s Republic of China, New York or United States federal court, from service of process, attachment upon or prior to
judgment, or attachment in aid of execution of judgment, or from execution of a judgment, or other legal process or proceeding
for the giving of any relief or for the enforcement of a judgment, in any such court, with respect to its obligations, liabilities
or any other matter under or arising out of or in connection with this Agreement; and, to the extent that the Company, or any of
its properties, assets or revenues may have or may hereafter become entitled to any such right of immunity in any such court in
which proceedings may at any time be commenced, the Company hereby waives such right to the extent permitted by law and hereby
consents to such relief and enforcement as provided in this Agreement and the other Transaction Documents.


 






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(b) 
Counterparts. This Agreement may be executed in two or more identical counterparts, all of which shall be considered
one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other
party. In the event that any signature is delivered by facsimile transmission or by an e-mail which contains a portable document
format (.pdf) file of an executed signature page, such signature page shall create a valid and binding obligation of the party
executing (or on whose behalf such signature is executed) with the same force and effect as if such signature page were an original
thereof.


 


(c) 
Headings; Gender. The headings of this Agreement are for convenience of reference and shall not form part of, or
affect the interpretation of, this Agreement. Unless the context clearly indicates otherwise, each pronoun herein shall be deemed
to include the masculine, feminine, neuter, singular and plural forms thereof. The terms “including,” “includes,”
“include” and words of like import shall be construed broadly as if followed by the words “without limitation.”
The terms “herein,” “hereunder,” “hereof” and words of like import refer to this entire Agreement
instead of just the provision in which they are found.


 


(d) 
Severability; Maximum Payment Amounts. If any provision of this Agreement is prohibited by law or otherwise determined
to be invalid or unenforceable by a court of competent jurisdiction, the provision that would otherwise be prohibited, invalid
or unenforceable shall be deemed amended to apply to the broadest extent that it would be valid and enforceable, and the invalidity
or unenforceability of such provision shall not affect the validity of the remaining provisions of this Agreement so long as this
Agreement as so modified continues to express, without material change, the original intentions of the parties as to the subject
matter hereof and the prohibited nature, invalidity or unenforceability of the provision(s) in question does not substantially
impair the respective expectations or reciprocal obligations of the parties or the practical realization of the benefits that would
otherwise be conferred upon the parties. The parties will endeavor in good faith negotiations to replace the prohibited, invalid
or unenforceable provision(s) with a valid provision(s), the effect of which comes as close as possible to that of the prohibited,
invalid or unenforceable provision(s). Notwithstanding anything to the contrary contained in this Agreement or any other Transaction
Document (and without implication that the following is required or applicable), it is the intention of the parties that in no
event shall amounts and value paid by the Company and/or any of its Subsidiaries (as the case may be), or payable to or received
by any of the Buyers, under the Transaction Documents (including without limitation, any amounts that would be characterized as
“interest” under applicable law) exceed amounts permitted under any applicable law. Accordingly, if any obligation
to pay, payment made to any Buyer, or collection by any Buyer pursuant the Transaction Documents is finally judicially determined
to be contrary to any such applicable law, such obligation to pay, payment or collection shall be deemed to have been made by mutual
mistake of such Buyer, the Company and its Subsidiaries and such amount shall be deemed to have been adjusted with retroactive
effect to the maximum amount or rate of interest, as the case may be, as would not be so prohibited by the applicable law. Such
adjustment shall be effected, to the extent necessary, by reducing or refunding, at the option of such Buyer, the amount of interest
or any other amounts which would constitute unlawful amounts required to be paid or actually paid to such Buyer under the Transaction
Documents. For greater certainty, to the extent that any interest, charges, fees, expenses or other amounts required to be paid
to or received by such Buyer under any of the Transaction Documents or related thereto are held to be within the meaning of “interest”
or another applicable term to otherwise be violative of applicable law, such amounts shall be pro-rated over the period of time
to which they relate.


 






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(e) 
Entire Agreement; Amendments. This Agreement, the other Transaction Documents and the schedules and exhibits attached
hereto and thereto and the instruments referenced herein and therein supersede all other prior oral or written agreements between
the Buyers, the Company, its Subsidiaries, their affiliates and Persons acting on their behalf, including, without limitation,
any transactions by any Buyer with respect to Ordinary Shares or the Securities, and the other matters contained herein and therein,
and this Agreement, the other Transaction Documents, the schedules and exhibits attached hereto and thereto and the instruments
referenced herein and therein contain the entire understanding of the parties solely with respect to the matters covered herein
and therein; provided, however, nothing contained in this Agreement or any other Transaction Document shall (or shall be deemed
to) (i) have any effect on any agreements any Buyer has entered into with, or any instruments any Buyer has received from, the
Company or any of its Subsidiaries prior to the date hereof with respect to any prior investment made by such Buyer in the Company
or (ii) waive, alter, modify or amend in any respect any obligations of the Company or any of its Subsidiaries, or any rights of
or benefits to any Buyer or any other Person, in any agreement entered into prior to the date hereof between or among the Company
and/or any of its Subsidiaries and any Buyer, or any instruments any Buyer received from the Company and/or any of its Subsidiaries
prior to the date hereof, and all such agreements and instruments shall continue in full force and effect. Except as specifically
set forth herein or therein, neither the Company nor any Buyer makes any representation, warranty, covenant or undertaking with
respect to such matters. For clarification purposes, the Recitals are part of this Agreement. No provision of this Agreement may
be amended other than by an instrument in writing signed by the Company and the Required Holders (as defined below), and any amendment
to any provision of this Agreement made in conformity with the provisions of this Section 9(e) shall be binding on all Buyers
and holders of Securities, as applicable; provided that no such amendment shall be effective to the extent that it (A) applies
to less than all of the holders of the Securities then outstanding or (B) imposes any obligation or liability on any Buyer without
such Buyer’s prior written consent (which may be granted or withheld in such Buyer’s sole discretion). No waiver shall
be effective unless it is in writing and signed by an authorized representative of the waiving party, provided that the Required
Holders may waive any provision of this Agreement, and any waiver of any provision of this Agreement made in conformity with the
provisions of this Section 9(e) shall be binding on all Buyers and holders of Securities, as applicable, provided that no
such waiver shall be effective to the extent that it (1) applies to less than all of the holders of the Securities then outstanding
(unless a party gives a waiver as to itself only) or (2) imposes any obligation or liability on any Buyer without such Buyer’s
prior written consent (which may be granted or withheld in such Buyer’s sole discretion). No consideration (other than reimbursement
of legal fees) shall be offered or paid to any Person to amend or consent to a waiver or modification of any provision of any of
the Transaction Documents unless the same consideration also is offered to all of the parties to the Transaction Documents, all
holders of the Notes or all holders of the Warrants (as the case may be). From the date hereof and while any Notes or Warrants
are outstanding, the Company shall not be permitted to receive any consideration from a Buyer or a holder of Notes or Warrants
that is not otherwise contemplated by the Transaction Documents in order to, directly or indirectly, induce the Company or any
Subsidiary (i) to treat such Buyer or holder of Notes or Warrants in a manner that is more favorable than to other similarly situated
Buyers or holders of Notes or Warrants, as applicable, or (ii) to treat any Buyer(s) or holder(s) of Notes or Warrants in a manner
that is less favorable than the Buyer or holder of Notes or Warrants that is paying such consideration; provided, however, that
the determination of whether a Buyer has been treated more or less favorably than another Buyer shall disregard any securities
of the Company purchased or sold by any Buyer. The Company has not, directly or indirectly, made any agreements with any Buyers
relating to the terms or conditions of the transactions contemplated by the Transaction Documents except as set forth in the Transaction
Documents. Without limiting the foregoing, the Company confirms that, except as set forth in this Agreement, no Buyer has made
any commitment or promise or has any other obligation to provide any financing to the Company, any Subsidiary or otherwise. As
a material inducement for each Buyer to enter into this Agreement, the Company expressly acknowledges and agrees that (x) no due
diligence or other investigation or inquiry conducted by a Buyer, any of its advisors or any of its representatives shall affect
such Buyer’s right to rely on, or shall modify or qualify in any manner or be an exception to any of, the Company’s
representations and warranties contained in this Agreement or any other Transaction Document and (y) unless a provision of this
Agreement or any other Transaction Document is expressly preceded by the phrase “except as disclosed in the SEC Documents,”
nothing contained in any of the SEC Documents shall affect such Buyer’s right to rely on, or shall modify or qualify in any
manner or be an exception to any of, the Company’s representations and warranties contained in this Agreement or any other
Transaction Document. “Required Holders” means (I) prior to the Closing Date, each Buyer entitled to purchase
Notes at the Closing and (II) on or after the Closing Date, holders of a majority of the Registrable Securities as of such time
(excluding any Registrable Securities held by the Company or any of its Subsidiaries as of such time) issued or issuable hereunder
or pursuant to the Notes and/or the Warrants (or the Buyers, with respect to any waiver or amendment of Section 4(o)); provided,
that such majority must include (x) Alto Opportunity Master Fund, SPC - Segregated Master Portfolio B (“Alto”)
as long as Alto (or any of its affiliates) holds at least $100,000 in aggregate principal amount of Notes and (y) Hudson Bay Master
Fund Ltd (“Hudson Bay”) as long as Hudson Bay (or any of its affiliates) holds at least $100,000 in aggregate
principal amount of Notes..


 






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(f) 
Notices. Any notices, consents, waivers or other communications required or permitted to be given under the terms
of this Agreement must be in writing and will be deemed to have been delivered: (i) upon receipt, when delivered personally; (ii)
upon receipt, when sent by facsimile (provided confirmation of transmission is mechanically or electronically generated and kept
on file by the sending party) or electronic mail (provided that such sent email is kept on file (whether electronically or otherwise)
by the sending party and the sending party does not receive an automatically generated message from the recipient's email server
that such e-mail could not be delivered to such recipient); or (iii) one (1) Business Day after deposit with an overnight courier
service with next day delivery specified, in each case, properly addressed to the party to receive the same. The addresses, facsimile
numbers and e-mail addresses for such communications shall be:


 


If to the Company:


 


China SXT Pharmaceuticals, Inc.

178 Taidong Rd North

Taizhou, Jiangsu

China

Telephone: (___) ___-____

Facsimile: (___) ___-____

Attention: Chief Executive Officer

E-Mail:


 


With a copy (for informational purposes only) to:


 


Hunter Taubman Fischer & Li
LLC


1450 Broadway, 26th Floor


New York, NY 10018


Attn: Joan Wu, Esq.


Telephone: 212 530 2208


Facsimile: 212 202 6380


Email: jwu@htflawyers.com


 


If to the Transfer Agent:


 


TranShare SEcuriteis Transfer
and Registrar


15500 Roosevelt Blvd., Suite 302


Clearwater, FL 33760


Ph.  (303)662-1112


Fax. (727)269-5616


Attn: Jinling Liu


Email: Jliu@Transhare.com


 


If to a Buyer, to its address, e-mail address
and facsimile number set forth on the Schedule of Buyers, with copies to such Buyer’s representatives as set forth on the
Schedule of Buyers,


 


with a copy (for informational purposes only) to:


 


Kelley Drye & Warren LLP

101 Park Avenue

New York, NY 10178

Telephone: (212) 808-7540

Facsimile: (212) 808-7897

Attention: Michael A. Adelstein, Esq.

E-mail: madelstein@kelleydrye.com


 


or to such other address, e-mail address
and/or facsimile number and/or to the attention of such other Person as the recipient party has specified by written notice given
to each other party five (5) days prior to the effectiveness of such change, provided that Kelley Drye & Warren LLP shall only
be provided copies of notices sent to the lead Buyer. Written confirmation of receipt (A) given by the recipient of such notice,
consent, waiver or other communication, (B) mechanically or electronically generated by the sender’s facsimile machine or
e-mail containing the time, date, recipient facsimile number and, with respect to each facsimile transmission, an image of the
first page of such transmission or (C) provided by an overnight courier service shall be rebuttable evidence of personal service,
receipt by facsimile or receipt from an overnight courier service in accordance with clause (i), (ii) or (iii) above, respectively.


 






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(g) 
Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their respective
successors and assigns, including any purchasers of any of the Notes and Warrants. The Company shall not assign this Agreement
or any rights or obligations hereunder without the prior written consent of the Required Holders, including, without limitation,
by way of a Fundamental Transaction (as defined in the Warrants) (unless the Company is in compliance with the applicable provisions
governing Fundamental Transactions set forth in the Warrants) or a Fundamental Transaction (as defined in the Notes) (unless the
Company is in compliance with the applicable provisions governing Fundamental Transactions set forth in the Notes). A Buyer may
assign some or all of its rights hereunder in connection with any transfer of any of its Securities without the consent of the
Company, in which event such assignee shall be deemed to be a Buyer hereunder with respect to such assigned rights.


 


(h) 
No Third Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective
permitted successors and assigns, and is not for the benefit of, nor may any provision hereof be enforced by, any other Person,
other than the Indemnitees referred to in Section 9(k).


 


(i) 
Survival. The representations, warranties, agreements and covenants shall survive the Closing. Each Buyer shall be
responsible only for its own representations, warranties, agreements and covenants hereunder.


 


(j) 
Further Assurances. Each party shall do and perform, or cause to be done and performed, all such further acts and
things, and shall execute and deliver all such other agreements, certificates, instruments and documents, as any other party may
reasonably request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions
contemplated hereby.


 


(k) 
Indemnification. In consideration of each Buyer’s execution and delivery of the Transaction Documents and acquiring
the Securities thereunder and in addition to all of the Company’s other obligations under the Transaction Documents, the
Company shall defend, protect, indemnify and hold harmless each Buyer and each holder of any Securities and all of their shareholders,
partners, members, officers, directors, employees and direct or indirect investors and any of the foregoing Persons’ agents
or other representatives (including, without limitation, those retained in connection with the transactions contemplated by this
Agreement) (collectively, the “Indemnitees”) from and against any and all actions, causes of action, suits,
claims, losses, costs, penalties, fees, liabilities and damages, and expenses in connection therewith (irrespective of whether
any such Indemnitee is a party to the action for which indemnification hereunder is sought), and including reasonable attorneys’
fees and disbursements (the “Indemnified Liabilities”), incurred by any Indemnitee as a result of, or arising
out of, or relating to (i) any misrepresentation or breach of any representation or warranty made by the Company or any Subsidiary
in any of the Transaction Documents, (ii) any breach of any covenant, agreement or obligation of the Company or any Subsidiary
contained in any of the Transaction Documents or (iii) any cause of action, suit, proceeding or claim brought or made against such
Indemnitee by a third party (including for these purposes a derivative action brought on behalf of the Company or any Subsidiary)
or which otherwise involves such Indemnitee that arises out of or results from (A) the execution, delivery, performance or enforcement
of any of the Transaction Documents, (B) any transaction financed or to be financed in whole or in part, directly or indirectly,
with the proceeds of the issuance of the Securities, (C) any disclosure properly made by such Buyer pursuant to Section 4(i),
or (D) the status of such Buyer or holder of the Securities either as an investor in the Company pursuant to the transactions contemplated
by the Transaction Documents or as a party to this Agreement (including, without limitation, as a party in interest or otherwise
in any action or proceeding for injunctive or other equitable relief). To the extent that the foregoing undertaking by the Company
may be unenforceable for any reason, the Company shall make the maximum contribution to the payment and satisfaction of each of
the Indemnified Liabilities which is permissible under applicable law. Except as otherwise set forth herein, the mechanics and
procedures with respect to the rights and obligations under this Section 9(k) shall be the same as those set forth in Section 6
of the Registration Rights Agreement.


 






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(l) 
Construction. The language used in this Agreement will be deemed to be the language chosen by the parties to express
their mutual intent, and no rules of strict construction will be applied against any party. No specific representation or warranty
shall limit the generality or applicability of a more general representation or warranty. Each and every reference to share prices,
Ordinary Shares and any other numbers in this Agreement that relate to the Ordinary Shares shall be automatically adjusted for
any share splits, share dividends, share combinations, recapitalizations or other similar transactions that occur with respect
to the Ordinary Shares after the date of this Agreement. Notwithstanding anything in this Agreement to the contrary, for the avoidance
of doubt, nothing contained herein shall constitute a representation or warranty against, or a prohibition of, any actions with
respect to the borrowing of, arrangement to borrow, identification of the availability of, and/or securing of, securities of the
Company in order for such Buyer (or its broker or other financial representative) to effect short sales or similar transactions
in the future.


 


(m) 
Remedies. Each Buyer and in the event of assignment by Buyer of its rights and obligations hereunder, each holder
of Securities, shall have all rights and remedies set forth in the Transaction Documents and all rights and remedies which such
holders have been granted at any time under any other agreement or contract and all of the rights which such holders have under
any law. Any Person having any rights under any provision of this Agreement shall be entitled to enforce such rights specifically
(without posting a bond or other security), to recover damages by reason of any breach of any provision of this Agreement and to
exercise all other rights granted by law. Furthermore, the Company recognizes that in the event that it or any Subsidiary fails
to perform, observe, or discharge any or all of its or such Subsidiary’s (as the case may be) obligations under the Transaction
Documents, any remedy at law would inadequate relief to the Buyers. The Company therefore agrees that the Buyers shall be entitled
to specific performance and/or temporary, preliminary and permanent injunctive or other equitable relief from any court of competent
jurisdiction in any such case without the necessity of proving actual damages and without posting a bond or other security. The
remedies provided in this Agreement and the other Transaction Documents shall be cumulative and in addition to all other remedies
available under this Agreement and the other Transaction Documents, at law or in equity (including a decree of specific performance
and/or other injunctive relief).


 






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(n) 
Withdrawal Right. Notwithstanding anything to the contrary contained in (and without limiting any similar provisions
of) the Transaction Documents, whenever any Buyer exercises a right, election, demand or option under a Transaction Document and
the Company or any Subsidiary does not timely perform its related obligations within the periods therein provided, then such Buyer
may rescind or withdraw, in its sole discretion from time to time upon written notice to the Company or such Subsidiary (as the
case may be), any relevant notice, demand or election in whole or in part without prejudice to its future actions and rights.


 


(o) 
Payment Set Aside; Currency. To the extent that the Company makes a payment or payments to any Buyer hereunder or
pursuant to any of the other Transaction Documents or any of the Buyers enforce or exercise their rights hereunder or thereunder,
and such payment or payments or the proceeds of such enforcement or exercise or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside, recovered from, disgorged by or are required to be refunded, repaid or otherwise
restored to the Company, a trustee, receiver or any other Person under any law (including, without limitation, any bankruptcy law,
foreign, state or federal law, common law or equitable cause of action), then to the extent of any such restoration the obligation
or part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such payment
had not been made or such enforcement or setoff had not occurred. Unless otherwise expressly indicated, all dollar amounts referred
to in this Agreement and the other Transaction Documents are in United States Dollars (“U.S. Dollars”), and
all amounts owing under this Agreement and all other Transaction Documents shall be paid in U.S. Dollars. All amounts denominated
in other currencies (if any) shall be converted into the U.S. Dollar equivalent amount in accordance with the Exchange Rate on
the date of calculation. “Exchange Rate” means, in relation to any amount of currency to be converted into U.S.
Dollars pursuant to this Agreement, the U.S. Dollar exchange rate as published in the Wall Street Journal on the relevant date
of calculation.


 


(p) 
Judgment Currency.


 


(i) 
If for the purpose of obtaining or enforcing judgment against the Company in connection with this Agreement or any other
Transaction Document in any court in any jurisdiction it becomes necessary to convert into any other currency (such other currency
being hereinafter in this Section 9(p) referred to as the “Judgment Currency”) an amount due in US Dollars
under this Agreement, the conversion shall be made at the Exchange Rate prevailing on the Trading Day immediately preceding:


 


(1) 
the date actual payment of the amount due, in the case of any proceeding in the courts of New York or in the courts of any
other jurisdiction that will give effect to such conversion being made on such date: or


 


(2) 
the date on which the foreign court determines, in the case of any proceeding in the courts of any other jurisdiction (the
date as of which such conversion is made pursuant to this Section 9(p)(i)(2) being hereinafter referred to as the “Judgment
Conversion Date”).


 






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(ii) 
If in the case of any proceeding in the court of any jurisdiction referred to in Section 9(p)(i)(2) above, there is
a change in the Exchange Rate prevailing between the Judgment Conversion Date and the date of actual payment of the amount due,
the applicable party shall pay such adjusted amount as may be necessary to ensure that the amount paid in the Judgment Currency,
when converted at the Exchange Rate prevailing on the date of payment, will produce the amount of US Dollars which could have been
purchased with the amount of Judgment Currency stipulated in the judgment or judicial order at the Exchange Rate prevailing on
the Judgment Conversion Date.


 


(iii) 
Any amount due from the Company under this provision shall be due as a separate debt and shall not be affected by judgment
being obtained for any other amounts due under or in respect of this Agreement or any other Transaction Document.


 


(q) 
Independent Nature of Buyers’ Obligations and Rights. The obligations of each Buyer under the Transaction Documents
are several and not joint with the obligations of any other Buyer, and no Buyer shall be responsible in any way for the performance
of the obligations of any other Buyer under any Transaction Document. Nothing contained herein or in any other Transaction Document,
and no action taken by any Buyer pursuant hereto or thereto, shall be deemed to constitute the Buyers as, and the Company acknowledges
that the Buyers do not so constitute, a partnership, an association, a joint venture or any other kind of group or entity, or create
a presumption that the Buyers are in any way acting in concert or as a group or entity, and the Company shall not assert any such
claim with respect to such obligations or the transactions contemplated by the Transaction Documents or any matters, and the Company
acknowledges that the Buyers are not acting in concert or as a group, and the Company shall not assert any such claim, with respect
to such obligations or the transactions contemplated by the Transaction Documents. The decision of each Buyer to purchase Securities
pursuant to the Transaction Documents has been made by such Buyer independently of any other Buyer. Each Buyer acknowledges that
no other Buyer has acted as agent for such Buyer in connection with such Buyer making its investment hereunder and that no other
Buyer will be acting as agent of such Buyer in connection with monitoring such Buyer’s investment in the Securities or enforcing
its rights under the Transaction Documents. The Company and each Buyer confirms that each Buyer has independently participated
with the Company and its Subsidiaries in the negotiation of the transaction contemplated hereby with the advice of its own counsel
and advisors. Each Buyer shall be entitled to independently protect and enforce its rights, including, without limitation, the
rights arising out of this Agreement or out of any other Transaction Documents, and it shall not be necessary for any other Buyer
to be joined as an additional party in any proceeding for such purpose. The use of a single agreement to effectuate the purchase
and sale of the Securities contemplated hereby was solely in the control of the Company, not the action or decision of any Buyer,
and was done solely for the convenience of the Company and its Subsidiaries and not because it was required or requested to do
so by any Buyer. It is expressly understood and agreed that each provision contained in this Agreement and in each other Transaction
Document is between the Company, each Subsidiary and a Buyer, solely, and not between the Company, its Subsidiaries and the Buyers
collectively and not between and among the Buyers.


 


[signature pages follow]


 




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IN WITNESS WHEREOF,
each Buyer and the Company have caused their respective signature page to this Agreement to be duly executed as of the date first
written above.


 





	 	COMPANY:
	 	 	 
	 	CHINA SXT PHARMACEUTICALS, INC.
	 	 	 
	 	By:	/s/ Feng Zhou
	 	 	Name: Feng Zhou
	 	 	Title:   Chief Executive Officer



 




     


     


    

 


IN WITNESS WHEREOF,
each Buyer and the Company have caused their respective signature page to this Agreement to be duly executed as of the date
first written above.


 


	 	BUYER:
	 	 	 
	 	Alto Opportunity Master Fund, SPC - Segregated Master Portfolio
    B
	 	 	 
	 	By:	/s/ Waqas Khatri
	 	 	Name: Waqas Khatri
	 	 	Title:    Director


 



     


     


    

 


IN WITNESS WHEREOF,
each Buyer and the Company have caused their respective signature page to this Agreement to be duly executed as of the date first
written above.


 


	 	BUYER:
	 	 	 
	 	HUDSON BAY MASTER FUND LTD
	 	 	 
	 	By:	/s/ George Antonopoulos
	 	 	Name: George Antonopoulos
	 	 	Title:   Authorized Signatory