China Information Technology Inc.: Exhibit 4.1 - Filed by newsfilecorp.com






STANDSTILL AND WARRANT EXTENSION AGREEMENT 
(NO. B[•])


THIS STANDSTILL AND WARRANT EXTENSION AGREEMENT is dated as of
___________, 2015 (this “Agreement”), by and between CHINA INFORMATION
TECHNOLOGY, INC., a company incorporated under the laws of the British Virgin
Islands (the “Company”), and the Holder set forth on the signature page
hereto (the “Holder”). 

R E C I T A L
S 

A.     The Company and the Holder are
parties to that certain Securities Purchase Agreement dated as of May 20, 2015
(the “Securities Purchase Agreement”), by and among the Company and the
investors party thereto. 

B.     At the Closing of the transactions
contemplated by Securities Purchase Agreement, the Company issued the Securities
to the Holder pursuant to an effective shelf registration statement on Form F-3
(Registration Number 333-196755), including, among others, a Series B Warrant
(the “Series B Warrant”) to purchase an aggregate number of Ordinary
Shares as set forth therein (subject to adjustment as provided therein). Unless
otherwise indicated, all capitalized terms used and not otherwise defined herein
have the respective meanings ascribed to them in the Securities Purchase
Agreement or the Series B Warrant, as applicable. 

C.     At the request of the Company, the
Holder has agreed to restrict the Series B Warrant as set forth below in
exchange for an extension of the Expiration Date and the other terms and
conditions set forth below. 

A G R E E M E
N T 

NOW, THEREFORE, in consideration of the foregoing and the
mutual covenants, conditions and provisions contained herein, and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby agree as follows: 

1.     Warrant Standstill. Subject
to the terms and conditions set forth herein, the Holder agrees that it shall
not, and shall not be permitted to, exercise the Series B Warrant, in whole or
in part, for a period of three (3) months from the date hereof (the
“Suspension Period”); provided, however, that upon the occurrence
of (A) on any single Trading Date, the Price Trigger (as defined below) and the
Volume Trigger (as defined below), (B) the Going Private Trigger (as defined
below) or (C) the Company issues any Ordinary Shares in respect of any exercise
of another Series B Warrant (either in respect of an Exercise Notice that has
been previously delivered, but has not been satisfied prior to the date hereof,
or an Exercise Notice that is delivered subsequent to the date hereof) to any
other Holder who has not executed an agreement substantially identical in form
to this Agreement (a “Series B Exercise”) prior to expiration of the
Suspension Period, the Suspension Period shall be automatically and immediately
terminated and the Holder shall be permitted to exercise the Series B Warrant on
the Trading Day immediately following the applicable trigger date. For purposes
hereof, the “Price Trigger” shall mean the Trading Day during the
Suspension Period that (i) the quotient of (A) the sum of the VWAP of the
Ordinary Shares for each Trading Day of the five (5) lowest Trading Days during any twelve (12) consecutive Trading Day
period, divided by (B) five (5), is greater than $3.00 (as adjusted for share
splits, share distributions, recapitalizations or similar events). For purposes
hereof, the “Volume Trigger” shall mean the Trading Day during the
Suspension Period that (ii) the quotient of (A) the sum of the trading volume of
the Ordinary Shares for each Trading Day of the five (5) highest volume Trading
Days during any twelve (12) consecutive Trading Day period, divided by (B) five
(5) is greater than 300,000 Ordinary Shares (as adjusted for share splits, share
distributions, recapitalizations or similar events). For purposes hereof, the
“Going Private Trigger” means that the Company’s Board of Directors shall
approve any “going private” proposal submitted to the Company or its
shareholders. Notwithstanding the forgoing, the Company agrees that during the
Suspension Period, the Holder is entitled to exercise up to an aggregate of
4,000 Warrant Shares every seven (7) calendar days (the “Weekly Maximum
Amount of Warrant Shares”). The Company shall within one (1) Trading Day
inform the Holder in the event of (i) the issuance and delivery of Ordinary
Shares pursuant to any Exercise Notice in excess of the Weekly Maximum Amount of
Warrant Shares or (ii) any Series B Exercise, each by any other holder of a
Series B Warrant during the Suspension Period. In the event that the Company
does not so inform the Holder of any such exercises, the Expiration Date of the
Holder’s Series B Warrant shall immediately, and without any action by the
Holder or the Company, be extended by an additional one (1) year (the
“Warrant Extension Period”).





2.     Extension of Expiration Date.
Section 17(r) of the Series B Warrant is hereby amended and restated in its
entirety as follows: 

(r) “Expiration Date” means March 15, 2016, plus the
Warrant Extension Period, if any, or, if such date falls on a day other than a
Business Day or on which trading does not take place on the Principal Market (a
“Holiday”), the next date that is not a Holiday; provided, that
for each Business Day that the Company cannot or does not honor any Exercise
Notice (beyond the Share Delivery Date), the Expiration Date shall be extended
by one Business Day. 

3.     Confirmation; Full Force and
Effect. The amendment set forth in Section 2 amends the Series B Warrant on
and as of the date hereof, and the Series B Warrant shall remain in full force
and effect, as amended thereby, from and after the date hereof in accordance
with its terms. The Company hereby ratifies, approves and affirms in all
respects each of the Securities Purchase Agreement and the Series B Warrants (as
amended) and the other Transaction Documents, the terms and other provisions
hereof and thereof and the obligations hereunder and thereunder. 

4.     Representations and
Warranties. To induce the Holders to enter into this Agreement, the Company
hereby represents and warrants to the Holder that: 

(a)     Due Authorization and
Execution. The execution, delivery and performance of this Agreement have
been duly authorized by all requisite corporate authority or other action on the
part of the Company, this Agreement has been duly executed and delivered by the
Company, and this Agreement constitutes the legal, valid and binding obligations
of the Company, enforceable against the Company in accordance with its terms;


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(b)     No Material Adverse Effect.
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-3 filed with
the SEC relating to an issuance and sale by the Company of its Ordinary Shares
and which has not been publicly announced, or (ii) would reasonably be expected
to have a Material Adverse Effect; and 

(c)     No Defense, Offset or
Counterclaim. No events have taken place and no circumstances exist at the
date hereof which would give the Company a basis to assert a defense, offset or
counterclaim to any claim of any Holder with respect to the obligations of the
Company. 

5.     Waiver of Claims.The Holder,
by signing below, hereby waives and releases the Company and their respective
directors, officers, employees, attorneys, affiliates and subsidiaries from any
and all claims, offsets, defenses and counterclaims (including, without
limitation, any rights, claims, offsets or penalties in connection with a prior
Delivery Failure pursuant to Section 1(c) of the Series B Warrant) of which the
Holder is actually aware that currently exists, such waiver and release being
with full knowledge and understanding of the circumstances and effect thereof
and after having consulted legal counsel with respect thereto.

6.     Release. 

(a)     Company Release. In
consideration of the agreement of the Holder contained herein and for other good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the Company, on behalf of itself and its successors, assigns, and
other legal representatives, hereby absolutely, unconditionally and irrevocably
releases, remises and forever discharges the Holder, and its successors and
assigns, and its present and former shareholders, partners, members, managers,
consultants, affiliates, subsidiaries, divisions, predecessors, directors,
officers, attorneys, employees, agents and other representatives, and all
persons acting by, through, under or in concert with any of them (each Holder
and all such other Persons being hereinafter referred to collectively as the
“Releasees” and individually as a “Releasee”) of and from all demands, actions,
causes of action, suits, covenants, contracts, controversies, agreements,
promises, sums of money, accounts, bills, reckonings, damages and any and all
other claims, counterclaims, defenses, recoupment, rights of setoff, demands and
liabilities whatsoever (individually, a “Claim” and collectively, “Claims”) of
every name and nature, known or unknown, contingent or mature, suspected or
unsuspected, both at law and in equity, which the Company or any of its
respective successors, assigns, or other legal representatives may now or
hereafter own, hold, have or claim to have against the Releasees or any of them
for, upon, or by reason of any circumstance, action, cause or thing whatsoever
which arises at any time on or prior to the day and date of this Agreement,
including, without limitation, for or on account of, or in relation to, or in
any way in connection with the Securities Purchase Agreement, or any of the
other Transaction Documents or transactions thereunder or related thereto. 

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(b)     Full and Complete Defense.
The Company understands, acknowledges and agrees that the release set forth
above may be pleaded as a full and complete defense and may be used as a basis
for an injunction against any action, suit or other proceeding which may be
instituted, prosecuted or attempted in breach of the provisions of such release.


(c)     Release Absolute and
Unconditional. The Company agrees that no fact, event, circumstance,
evidence or transaction which could now be asserted or which may hereafter be
discovered shall affect in any manner the final, absolute and unconditional
nature of the release set forth above. 

(d)     No Reliance. In entering
into this Agreement, the Company has consulted with, and has been represented
by, legal counsel and expressly disclaims any reliance on any representations,
acts or omissions by any of the Releasees and hereby agrees and acknowledges
that the validity and effectiveness of the release set forth above does not
depend in any way on any such representations, acts and/or omissions or the
accuracy, completeness or validity hereof. The provisions of this Section 7
shall survive the termination of this Agreement and the other Transaction
Documents. 

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7.     Disclosure of Transaction.
The Company shall, on or before 8:30 a.m., New York City Time, on the first
business day after the date that it enters into this Agreement, issue a press
release and/or Report on Form 6-K (collectively, the “Press Release”)
disclosing all material terms of the transactions contemplated hereby and
thereby. From and after the issuance of the Press Release, the Holder shall not
be in possession of any material, nonpublic information received from the
Company or any of its respective officers, directors, employees or agents, that
is not disclosed in the Press Release. The Company shall not, and shall cause
its officers, directors, employees and agents, not to, provide the Holder with
any material, nonpublic information regarding the Company from and after the
filing of the Press Release without the express written consent of the Holder.
The Company shall not disclose the name of the Holder in any filing,
announcement, release or otherwise, unless such disclosure is required by law or
regulation. 

8.     Most Favored Nation. The
Company hereby represents and warrants as of the date hereof and covenants and
agrees from and after the date hereof that none of the terms offered to any
other Holder of the Series B Warrants with respect to any amendment, settlement
or waiver (each a “Settlement Document”) relating to the terms,
conditions and transactions contemplated hereby, is or will be more favorable to
such Person than those of the Holder and this Agreement shall be, at the
election of the Holder, without any further action by the Holder or the Company,
deemed amended and modified in an economically and legally equivalent manner
such that the Holder shall receive the benefit of the more favorable terms
contained in such Settlement Document, including, without limitation, any
provision in any Settlement Document for the right to receive a number of
Ordinary Shares in respect of any exercise of another Series B Warrant
subsequent to the date hereof in excess of the Weekly Maximum Amount of Warrant
Shares. Notwithstanding the foregoing, the Company agrees, at its expense, to
take such other actions (such as entering into amendments to the Transaction
Documents) as the Holder may reasonably request to further effectuate the
foregoing. 

9.     Miscellaneous Provisions.


(a)     Entire Agreement; Successors and
Assigns. This Agreement constitutes the entire understanding and agreement
between the parties with respect to the subject matter hereof, and supersedes
any and all other prior oral and written, and all contemporaneous oral,
agreements, negotiations, discussions and understandings with respect thereto.
This Agreement shall inure to the benefit of, and be binding upon, the parties
and their respective successors and permitted assigns. 

(b)     Trial by Jury; Governing Law;
Jurisdiction; Severability. TO THE EXTENT PERMITTED BY APPLICABLE LAW, THE
HOLDER AND THE SELLER HEREBY WAIVE TRIAL BY JURY IN ANY ACTION BROUGHT ON OR
WITH RESPECT TO THIS AGREEMENT. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE INTERNAL SUBSTANTIVE LAWS OF THE STATE OF NEW
YORK WITHOUT REFERENCE TO THE RULES THEREOF RELATING TO CONFLICTS OF LAW OTHER
THAN SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK, AND
THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS. To the extent permitted by applicable
Law, the parties hereto hereby submit to the non-exclusive jurisdiction of the
federal and state courts of competent jurisdiction in the Borough of Manhattan
in The City of New York in any suit or proceeding arising out of or relating to
this Agreement or the transactions contemplated hereby. Any provision of this
Agreement that is prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall (to the full
extent permitted by Law) not invalidate or render unenforceable such provision
in any other jurisdiction. 

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(c)     Headings. The headings of
the Sections of this Agreement have been inserted for convenience of reference
only, are not to be considered a part hereof and shall in no way modify or
restrict any of the terms or provisions hereof. 

(d)     Counterparts. This Agreement
may be executed in any number of counterparts, each of which shall be deemed to
be an original, but all such counterparts shall together constitute one and the
same Agreement. Any counterpart may be executed by facsimile or other electronic
transmission, and such facsimile or other electronic transmission shall be
deemed an original. 

[Signature Page Follows] 

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IN WITNESS WHEREOF, the parties have caused this Agreement to
be executed and delivered by their duly authorized representatives as of the
date first written above. 

COMPANY 

CHINA INFORMATION TECHNOLOGY, INC., a
British Virgin Islands company 


	By: 	
	 	Name: 
	 	Title: 



HOLDER 

[•] 


	By: 	 
	         	Name: 
	         	Title: 



 

[Signature Page to Standstill and Warrant Extension Agreement]