Exhibit 10.1


 


SHARE PURCHASE AGREEMENT


 


THIS SHARE PURCHASE
AGREEMENT (the “Agreement”) is dated as of November 20, 2017, by and between Recon Technology, Ltd, a Cayman
Islands corporation, (the “Company”), and Yongquan Bi, a citizen of People’s Republic of China (the
“Buyer” and, together with the Company, the “Parties” and each, a “Party”).


 


WHEREAS:


 


A.       The
Company and the Buyer are executing and delivering this Agreement in reliance upon the exemption from securities registration afforded
by (i) Section 4(a)(2) of the Securities Act of 1933, as amended (the “1933 Act”) and (ii) (a) Rule 506 of Regulation
D (“Regulation D”) and (b) Rule 903 of Regulation S (“Regulation S”), both as promulgated
by the U.S. Securities and Exchange Commission (the “SEC”) under the 1933 Act.


 


B.       The
Buyer wishes to purchase, and the Company wishes to sell, upon the terms and conditions stated in this Agreement, 3,000,000 ordinary
shares of the Company, par value $0.0185 per share (the “Ordinary Shares”), which will constitute approximately
20.28 percent (20.28%) of all of the Company’s outstanding Ordinary Shares at the time of the Closing on a fully diluted
basis (the “Shares”).


 


C.       The
Parties intend for all of the promises and obligations discussed herein to be subject to and contingent upon compliance with NASDAQ
Stock Market Rules, and neither party intends for any issuance to occur in the absence of such compliance.


 


D.       The
board of directors of the Buyer has (i) approved the execution, delivery and performance by the Buyer of this Agreement and
consummation of the transactions contemplated hereby and (ii) declared it advisable for the Buyer to enter into this Agreement.


 


E.       The
board of directors of the Company (the “Board of Directors”), acting upon the unanimous recommendation of a
special committee of independent directors of the Board of Directors, has (i) determined that it is in the best interest of the
Company and its shareholders, and declared it advisable, to enter into this Agreement, and (ii) approved the execution, delivery
and performance by the Company of this Agreement and consummation of the transactions contemplated hereby.


 


NOW, THEREFORE,
the Company and the Buyer hereby agree as follows:


 


1.                 
PURCHASE AND SALE OF SHARES.


 


(a)              
Sale of Shares. Subject to the satisfaction (or waiver) of the conditions set forth in Sections 5 and 6 below, the
Company shall issue and allot to the Buyer, and the Buyer agrees to subscribe from the Company, on the Closing Date (as defined
below), the Shares (the “Closing”).


 






    	 	 	 



     


    

 


(b)              
Closing. The date and time of the Closing (the “Closing Date”) shall be 10:00 a.m., Eastern Standard
Time, within five (5) days after the later of the (i) receipt of payment in full for the Shares by the Company and (ii) the satisfaction
(or waiver) of the conditions to the Closing set forth in Sections 5 and 6 below, or any such other time and date as is mutually
agreed to by the Company and the Buyer, at the offices of the Company at Recon Technology, Ltd, Room 1902, Building C, King Long
International Mansion, No. 9 Fulin Road, Beijing, 100107, People’s Republic of China. In the event the Closing Date has not
occurred on or before January 20, 2018, this Agreement will terminate automatically and be of no further effect unless otherwise
extended by agreement of the parties; provided, however, that if the only failure for the closing to occur is the Buyer’s
failure to pay the second installment (as described in Section 1(d) hereof), then the Closing shall occur as to such Shares for
which payment has been made.


 


(c)              
Purchase Price. The purchase price for the Shares to be purchased by Buyer at the Closing shall be approximately
equal to US$1.60 per Share, with the aggregate purchase price equal to US$4,800,000 (the “Purchase Price”).


 


(d)              
Form of Payment. On or prior to the Closing Date, the Buyer shall make payment in full for the Purchase Price of
the Shares to be issued and allotted to the Buyer at Closing, by wire transfer of immediately available funds in accordance with
the Company’s written wire instructions, which written instructions shall be delivered by the Company to the Buyer no later
than three (3) days prior to the anticipated Closing Date. The Purchase Price shall be made in two installments: (i) the first
installment of US$2,400,000 shall be made on the date hereof; and (2) the second installment of US$2,400,000 shall be made on or
before January 20, 2018.


 


(e)              
Closing Deliverables. On the Closing Date, the Company shall deliver, or cause to be delivered, to the Buyer the
following closing deliverables:


 


(i)               
a share certificate in customary form in respect of the 3,000,000 duly authorized and validly issued Shares to be issued
and allotted to the Buyer at the Closing; and


 


(ii)             
a copy of the register of members of the Company, as certified by the registered agent of the Company and updated to reflect
the subscription by the Buyer of the Shares as provided herein.


 


2.                 
BUYER’S REPRESENTATIONS AND WARRANTIES. The Buyer represents and warrants to the Company, as of the date hereof
and as of the Closing, that:


 


(a)              
No Sale or Distribution. The Buyer is acquiring the Shares for its own account and not with a view towards, or for
resale in connection with, the public sale or distribution thereof, except pursuant to sales registered or exempted 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 Shares.


 


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


 






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(c)              
Reliance on Exemptions. The Buyer understands that the Shares 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 Shares.


 


(d)              
Information. The Buyer has 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 Shares that have been reasonably requested by the Buyer. The Buyer
has been afforded the opportunity to ask questions of the Company. Neither such inquiries nor any other due diligence investigations
conducted by the Buyer or its representatives shall modify, amend or affect such Buyer’s right to rely on the Company’s
representations and warranties contained herein. The Buyer understands that its investment in the Shares involves a high degree
of risk and is able to afford a complete loss of such investment. The 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 Shares.


 


(e)              
No Governmental Review. The 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 Shares or the fairness or suitability of
the investment in the Shares nor have such authorities passed upon or endorsed the merits of the offering of the Shares.


 


(f)               
Transfer or Resale. The Buyer understands that (i) the Shares have not been and are not being registered under the
1933 Act, and may not be offered for sale, sold, assigned or transferred unless (A) subsequently registered thereunder or (B) the
Buyer shall have delivered to the Company an opinion of counsel, in a form reasonably acceptable to the Company, to the effect
that such Shares to be sold, assigned or transferred may be sold, assigned or transferred pursuant to an exemption from such registration;
(ii) neither the Company nor any other person is under any obligation to register the Shares under the 1933 Act or any state securities
laws or to comply with the terms and conditions of any exemption thereunder; and (iii) the Buyer has agreed that, in addition to
restrictions on resale that apply under Rule 144, Buyer will not be permitted to sell or transfer the Shares for two (2) years
following the Closing Date.


 


(g)              
Lock-Up. The Buyer will not register, offer, sell, contract to sell or grant any Shares or any securities convertible
into or exercisable or exchangeable for the Shares or any warrants to purchase the Shares (including, without limitation, securities
of the Company which may be deemed to be beneficially owned by the undersigned in accordance with the rules and regulations of
the Securities and Exchange Commission and securities which may be issued upon the exercise of a stock option or warrant) for a
period of two (2) years following the Closing Date.


 


(h)              
Legends. The Buyer understands that the stock certificates for the Shares, unless and until registered, shall bear
a restrictive legend in substantially the following form (and a stop-transfer order may be placed against transfer of such stock
certificates):


 






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“THE SECURITIES EVIDENCED
BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE ‘SECURITIES ACT’), OR
THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. THE SECURITIES MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED
(A) AT ALL BEFORE JANUARY 20, 2020 OR (B) AFTER JANUARY 20, 2020, EXCEPT (1) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT OR (2) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH
ALL APPLICABLE STATE SECURITIES LAWS AND THE SECURITIES LAWS OF OTHER JURISDICTIONS, AND IN THE CASE OF A TRANSACTION EXEMPT FROM
REGISTRATION, UNLESS THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO IT THAT SUCH TRANSACTION DOES NOT
REQUIRE REGISTRATION UNDER THE SECURITIES ACT AND SUCH OTHER APPLICABLE LAWS.”


 


The legend set forth above shall be removed
and the Company shall issue a certificate without such legend to the holder of the Shares upon which it is stamped, if, unless
otherwise required by state securities laws, (i) such Shares are registered for resale under the 1933 Act or (ii) in connection
with a sale, assignment or other transfer, such holder provides the Company with a legal opinion reasonably acceptable to the Company,
to the effect that such sale, assignment or transfer of the Shares may be made without registration under the applicable requirements
of the 1933 Act.


 


(i)                
Validity; Enforcement. This Agreement has been duly and validly authorized, executed and delivered on behalf of the
Buyer and shall constitute the legal, valid and binding obligations of the Buyer enforceable against the Buyer in accordance with
its 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.


 


(j)                
No Conflicts. The execution, delivery and performance by the Buyer of this Agreement and the consummation by the
Buyer of the transactions contemplated hereby will not (i) result in a violation of the organizational documents of the Buyer,
(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 the 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 the Buyer, except in the case of clauses (ii) and (iii) above, for such conflicts,
defaults, rights or violations which would not, individually or in the aggregate, reasonably be expected to have material impact
upon the ability of the Buyer to perform its obligations hereunder.  


 






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(k)              
Residency. The Buyer is a citizen of People’s Republic of China (“China”). The offer and
sale of the Shares has been made in an offshore transaction and did not involve any directed selling efforts in the United States.
The term “offshore transaction” shall have the meaning assigned to it by Regulation S.


 


(l)                
Certain Trading Activities. Other than with respect to the transactions contemplated herein, since the time that
the Buyer was first contacted by the Company or any other person regarding the investment in the Company set forth herein, neither
the Buyer nor any Affiliate (as defined in Rule 12b-2 of the SEC Rules promulgated under the 1934 Act) of the Buyer which (x) had
knowledge of the transactions contemplated hereby, (y) has or shares discretion relating to the Buyer’s investments or trading
or information concerning the Buyer’s investments and (z) is subject to the Buyer’s review or input concerning such
Affiliate’s investments or trading (collectively, “Trading Affiliates”) has directly or indirectly, nor
has any person acting on behalf of or pursuant to any understanding with such Buyer or Trading Affiliate, (i) effected or agreed
to effect any purchase or sale of the Shares, (ii) taken, directly or indirectly, any action designed to cause or to result, or
that could reasonably be expected to cause or result, in the stabilization or manipulation of the price of any security of the
Company, or (iii) paid or agreed to pay to any person any compensation for soliciting another to purchase or sell any securities
of the Company.


 


(m)            
No Consideration. The Buyer has not paid any consideration, directly or indirectly, to any officer, director or employee
of the Company or any Subsidiary (as defined in Section 3(a) hereof).


 


3.                 
REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company represents and warrants to the Buyer, as of the date hereof
and as of the Closing, that:


 


(a)              
Organization and Qualification. The Company and its “Subsidiaries” (which for purposes of this
Agreement includes any joint venture or any entity in which the Company, directly or indirectly, owns any of the capital stock
or holds an equity, contractual or other interest) are entities duly organized and validly existing and, to the extent legally
applicable, in good standing under the laws of the jurisdiction in which they are formed, and have the requisite power and authorization
to own their properties and to carry on their business as now being conducted. Each of the Company and its Subsidiaries is duly
qualified as a foreign entity to do business and, to the extent legally applicable, 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 used in this Agreement, “Material Adverse Effect” means any material adverse effect on the business, properties,
assets, operations, results of operations, condition (financial or otherwise) or prospects of the Company and its Subsidiaries,
individually or taken as a whole, or on the transactions contemplated hereby or by the agreements and instruments to be entered
into in connection herewith, or on the authority or ability of such party or Subsidiaries to perform its obligations under this
Agreement.


 






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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 to issue and allot the Shares to the Buyer in accordance with the terms hereof. The execution
and delivery of the Agreement by the Company and the consummation by the Company of the transactions contemplated hereby, including,
without limitation, the reservation for issuance and the issuance of the Shares, have been duly authorized by the Company’s
Board of Directors and no further filing, consent, or authorization is required by the Company, its Board of Directors or its shareholders
other than notification of the NASDAQ Capital Market (the “Principal Market”), which consent to the transactions
contemplated hereby has been received by the Company as of the date hereof. This Agreement has been duly executed and delivered
by the Company, and constitutes the legal, valid and binding obligations of the Company, enforceable against the Company in accordance
with its 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.


 


(c)              
No Conflicts. The execution, delivery and performance of this Agreement by the Company and the consummation by the
Company of the transactions contemplated hereby will not, unless such conflict or default could not reasonably be expected to result
in a Material Adverse Effect, (i) result in a violation of the Company’s Memorandum or Articles of Association (the “Organizational
Documents”) or any certificate of designations or other constituent documents of the Company or any of its Subsidiaries,
any capital stock of the Company or any similar governing documents 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
foreign, federal and state securities laws and regulations and the rules and regulations of the Principal Market and applicable
laws 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.


 


(d)              
Consents. Neither the Company nor any of its Subsidiaries is required to obtain any consent, authorization or order
of, or make any filing or registration with, any court, governmental agency or any regulatory or self-regulatory agency or any
other person in order for it to execute, deliver or perform any of its obligations under or contemplated by this Agreement in accordance
with the terms hereof, except for the following consents, authorizations, orders, filings and registrations (none of which is required
to be filed or obtained before the Closing): (i) the filing of such forms with the Principal Market as may be required regarding
the issuance of the Shares to the Buyer, which shall be done pursuant to the rules of the Principal Market; and (ii) the filing
with the SEC of Form D. The Company and its Subsidiaries are unaware of any facts or circumstances that might prevent the Company
from obtaining any of the application or filings pursuant to the preceding sentence.


 


(e)              
Acknowledgment Regarding Buyer’s Purchase of Shares. The Company acknowledges and agrees that the Buyer is
acting solely in the capacity of an arm’s length purchaser with respect to this Agreement and the transactions contemplated
hereby and that, immediately prior to issuance, and that the Buyer is not, and none of the Buyer's affiliates, directors, officers,
employees or representatives is (i) an officer or director of the Company, (ii) an “affiliate” of the Company or any
of its Subsidiaries (as defined in Rule 144) or (iii) to the knowledge of the Company, a “beneficial owner” of more
than 10% of the ordinary shares of the Company (as defined in Rule 13d-3 of the SEC Rules promulgated under the Securities Exchange
Act of 1934, as amended (the “1934 Act”)).


 






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(f)               
No General Solicitation. 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 Shares.


 


(g)              
No Integrated Offering. None of the Company, its Subsidiaries, any of their affiliates, and 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 any of the Shares under the 1933 Act or cause this offering of the Shares
to be integrated with prior offerings by the Company for purposes of the 1933 Act or 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. None of the Company, its Subsidiaries, their affiliates or any person acting
on their behalf will take any action or steps referred to in the preceding sentence that would require registration of any of the
Shares under the 1933 Act or cause the offering of the Shares to be integrated with other offerings.


 


(h)              
Equity Capitalization. As of the date hereof, the authorized capital stock of the Company consists of 100,000,000
Ordinary Shares. As of the date hereof, 11,787,849 Ordinary Shares are issued and outstanding, 900,000 shares are reserved for
issuance pursuant to the Company’s stock option and purchase plans, 170,000 shares are reserved for issuance pursuant to
the Company’s outstanding warrants, and no other shares are reserved for issuance pursuant to securities exercisable or exchangeable
for, or convertible into, Shares. All of such outstanding shares have been, or upon issuance will be, duly authorized, validly
issued and are fully paid and nonassessable, and issued in compliance with federal and state securities laws and free and clear
of all liens, claims and encumbrances. The Company has furnished to the Buyer true, correct and complete copies of the Company’s
Organizational Documents and the equivalent organizational documents of each of the Company’s Subsidiaries, each as amended
and as in effect on the date hereof, and the terms of all securities convertible into, or exercisable or exchangeable for, Shares
and the material rights of the holders thereof in respect thereto. None of the Company or any of its Subsidiaries is in violation
or breach of any of its organizational documents. The Shares when issued and allotted to the Buyer in accordance with the terms
of this Agreement will be duly and validly issued, and issued in compliance with federal and state securities laws and free of
all liens, claims and encumbrances.


 


(i)                
Manipulation of Price. The Company has not, and to its knowledge no one acting on its behalf has, (i) taken, directly
or indirectly, any action designed to cause or to result, or that could reasonably be expected to cause or result, in the stabilization
or manipulation of the price of any security of the Company, (ii) paid or agreed to pay to any person any compensation for soliciting
another to purchase any other securities of the Company.


 






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(j)                
No Consideration. The Company is not aware of any consideration being paid by any Buyer, directly or indirectly,
to any officer, director or employee of the Company or any Subsidiary.


 


(k)              
Subsidiaries. The Company does not own, or have any interest in any shares or have an ownership interest in any entity
other than as disclosed in its Public Filings. The share capital of each Subsidiary of the Company are duly authorized, validly
issued, fully paid and nonassessable, and is issued in compliance with any applicable securities laws and free and clear of all
liens, claims and encumbrances.


 


(l)                
Financial Statements. The Company has timely filed or furnished, as applicable, all reports, schedules, forms, statements
and other documents required to be filed or furnished by it with the SEC pursuant to the 1933 Act or the 1934 Act (all of the foregoing
documents, together with all exhibits included therein and financial statements, notes, and schedules thereto and documents incorporated
by reference therein, the “Public Filings”). Except to the extent subsequently amended, the Public Filings,
as of the date they were filed or furnished, complied in all material respects with the requirements of the 1933 Act or the 1934
Act, as the case may be, and the rules and regulations of the SEC promulgated thereunder, as applicable, and none of the Public
Filings at such time 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 light of the circumstances under which they were made, not misleading.
There are no outstanding or resolved comments received from the SEC or its staff. The financial statements of the Company included
in the Public Filings (the “Financial Statements”) have been prepared in accordance with U.S. GAAP applied on
a consistent basis throughout the period involved. The Financial Statements are based on the books and records of the Company,
and fairly present in all material respects the financial condition of the Company as of the respective dates they were prepared
and the results of the operations of the Company for the periods indicated. The Company maintains a standard system of accounting
established and administered in accordance with U.S. GAAP.


 


(m)            
Undisclosed Liabilities. The Company has no liabilities, obligations or commitments of any nature whatsoever, asserted
or unasserted, known or unknown, absolute or contingent, accrued or unaccrued, matured or unmatured or otherwise (“Liabilities”),
except (a) those which are adequately reflected or reserved against in the financial statements filed in the Company’s annual
report filed on Form 20-F with the SEC on September 28, 2017, and (b) those which have been incurred in the ordinary course of
business consistent with past practice since the date of the aforementioned financial statements.


 


(n)              
No Bankruptcy or Insolvency. Company has not: (a) filed any voluntary or had involuntarily filed against it in any
court or with any governmental body, a petition in bankruptcy or insolvency or seeking to effect any plan or other arrangement
with creditors, or seeking the appointment of a receiver; (b) had a receiver, conservator or liquidating agent or similar person
appointed for all or a substantial portion of its assets, suffered the attachment or other judicial seizure of all, or substantially
all of its assets; (c) given notice to any person or governmental body of insolvency; or (d) made an assignment for the benefit
of its creditors or taken any other similar action for the protection or benefit of its creditors. Company is solvent and will
not be rendered insolvent by the performance of its obligations under this Agreement.


 






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(o)              
Taxes. Each of the Company and its Subsidiaries has timely filed all returns (as hereinafter defined) required to
be filed with taxing authorities prior to the date hereof or has duly obtained extensions of time for the filing thereof, and all
such returns are true, complete and accurate. Each of the Company and its Subsidiaries has paid all taxes (as hereinafter defined)
shown as due on such returns that were filed and has paid all taxes imposed on or assessed against the Company or any of its Subsidiaries.
The provisions for taxes payable, if any, shown on the financial statements filed with or in the Public Filings are sufficient
for all accrued and unpaid taxes, whether or not disputed, and for all periods to and including the dates of such consolidated
financial statements. The Company and each of its Subsidiaries (i) have made available to Buyer true, correct and complete copies
of all agreements or documents relating to tax holidays or tax incentives, as in effect as of the date hereof, and (ii) are in
compliance with all requirements for any applicable tax holidays or tax incentives. Except as disclosed in writing to the Buyer,
(i) no issues have been raised by any taxing authority and there is not currently pending any audit, examination, investigation
or other proceeding in connection with any taxes of the Company or its Subsidiaries, (ii) neither the Company nor any of its Subsidiaries
has received written notice in a jurisdiction where it does not file returns that it is or may be subject to taxation by that jurisdiction,
(iii) no waivers of statutes of limitations with respect to any returns or collection of taxes and no extensions of time with respect
to any tax assessments or deficiencies have been given by or requested from the Company or its Subsidiaries, (iv) there are no
liens for taxes upon the assets of the Company or any of its Subsidiaries (other than liens for taxes not yet due and payable or
for taxes that are being contested in good faith and for which adequate reserves have been established), (v) neither the Company
nor any of its Subsidiaries is a party to any tax allocation, sharing or indemnity agreement (other than any tax indemnification
provisions in commercial agreements or agreements that are not primarily related to taxes and any agreements between or among any
of the Company and its Subsidiaries) and (vi) the Company and each of its Subsidiaries are in compliance with all applicable laws
relating to transfer pricing, including the execution and maintenance of contemporaneous documentation substantiating the transfer
pricing practices and methodology of the Company and its Subsidiaries. The term “taxes” means all federal, state, local,
foreign, and other net income, gross income, gross receipts, sales, use, ad valorem, transfer, franchise, profits, license, lease,
service, service use, withholding, payroll, employment, excise, severance, stamp, occupation, premium, property, windfall profits,
customs, duties or other taxes, fees, assessments, or charges of any kind, whether computed on a separate, consolidated, unitary,
combined or any other basis, and any interest, penalties, fines, or additional amounts attributable to, imposed upon or with respect
to any of the foregoing. The term “returns” means all returns (including information returns), declarations, reports,
statements, and other documents required to be filed in respect to taxes, including any amendments thereof or attachments or supplements
thereto.


 


(p)              
Absence of Certain Changes, Events and Conditions. Since the date of the financial statements filed in the Company’s
annual report filed on Form 20-F with the SEC on September 28, 2017, and other than in the ordinary course of business consistent
with past practice, there has not been, with respect to the Company, any:


 


(i)                
event, occurrence or development that has had, or could reasonably be expected to have, individually or in the aggregate,
a Material Adverse Effect (as defined in Section 3(i));


 






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(ii)             
amendment of the articles or memorandum of association of the Company;


 


(iii)           
split, combination or reclassification of any shares of its capital stock;


 


(iv)            
issuance, sale or other disposition of any of its capital stock, or grant of any options, warrants or other rights to purchase
or obtain (including upon conversion, exchange or exercise) any of its capital stock other than as disclosed to the Buyer;


 


(v)              
declaration or payment of any dividends or distributions on or in respect of any of its capital stock or redemption, purchase
or acquisition of its capital stock;


 


(vi)            
material change in any method of accounting or accounting practice of the Company, except as required by U.S. GAAP or as
disclosed in the notes to the Financial Statements;


 


(vii)         
incurrence, assumption or guarantee of any indebtedness for borrowed money except unsecured current obligations and liabilities
incurred in the ordinary course of business consistent with past practice;


 


(viii)       
capital investment in, or any loan to, any other person;


 


(ix)            
imposition of any encumbrance upon any of the Company properties, capital stock or assets, tangible or intangible;


 


(x)              
loan to (or forgiveness of any loan to), or entry into any other transaction with, any of its stockholders or current or
former directors, officers and employees;


 


(xi)            
entry into an IP Contract; or


 


(xii)         
contract to do any of the foregoing, or any action or omission that would result in any of the foregoing.


 


(q)              
Material Contracts. The Company’s Public Filings fully disclose the Company’s entry into or termination
of any material definitive agreements to which the Company is a party (each, a “Material Contract”). The term
“Material Contract” shall mean an agreement that provides for obligations that are material to and enforceable
against the Company, or rights that are material to the Company and enforceable by the Company against one or more other parties
to the agreement, in each case whether or not subject to conditions. Each Material Contract is valid and binding on the Company
and the counterparties to such Material Contract, in each case in accordance with its terms, and is in full force and effect. None
of the Company or, to the Company’s knowledge, any other party thereto is in breach of or default under (or is alleged to
be in breach of or default under) in any material respect, or has provided or received any notice of any intention to terminate,
any Material Contract. No event or circumstance has occurred that, with notice or lapse of time or both, would constitute an event
of default under any Material Contract or result in a termination thereof or would cause or permit the acceleration or other changes
of any right or obligation or the loss of any benefit thereunder.


 






    	 	10	 



     


    

 


(r)               
Property. The Company and each Subsidiary owns or leases all such properties as are necessary to the conduct of its
business as presently operated and as proposed to be operated. The Company and the Subsidiaries have good and marketable title
to all real property and good and marketable title to all personal property owned by them, in each case free and clear of all liens,
claims and encumbrances, except such as disclosed in the Company’s Public Filings or such as do not (individually or in the
aggregate) materially affect the value of such property and do not interfere with the use made or proposed to be made of such property
by the Company or any of the Subsidiaries. Any real property and buildings held under lease or sublease by the Company and the
Subsidiaries are held by them under valid, subsisting and enforceable leases with such exceptions as are not material to, and do
not interfere with, the use made and proposed to be made of such property and buildings by the Company and the Subsidiaries. Neither
the Company nor any Subsidiary has received any written notice of any claim adverse to its ownership of any real or personal property
or of any claim against the continued possession of any real property, whether owned or held under lease or sublease by the Company
or any Subsidiary.


 


(s)               
Intellectual Property.


 


(i)                
The Company and each of its Subsidiaries own or have the valid right to use, free and clear of all encumbrances, all of
the following to the extent owned, used, held for use in, or necessary for the conduct of the business of the Company and its Subsidiaries
as currently conducted and as contemplated to be conducted: (1) inventions, whether or not patentable, reduced to practice or made
the subject of one or more pending patent applications, (2) national and multinational statutory invention registrations, patents
and patent applications (including all reissues, divisions, continuations, continuations-in-part, extensions and reexaminations
thereof) registered or applied for in China, the United States of America and all other nations throughout the world, including
all improvements to the inventions disclosed in each such registration, patent or patent application ((1) and (2) together, “Patents”),
(3) trademarks, service marks, trade dress, logos, domain names, trade names and corporate names and other similar designations
of source or origin, (whether or not registered) in China, the United States and all other nations throughout the world, including
all variations, derivations, combinations, registrations and applications for registration of the foregoing and all goodwill associated
therewith, (4) copyrights (whether or not registered) and registrations and applications for registration thereof in China, the
United States and all other nations throughout the world, including all derivative works, moral rights, renewals, extensions, reversions
or restorations associated with such copyrights, now or hereafter provided by law, regardless of the medium of fixation or means
of expression, (5) computer software (including source code, object code, firmware, operating systems and specifications), (6)
trade secrets and, whether or not confidential, business information (including pricing and cost information, business and marketing
plans and customer and supplier lists) and know-how (including manufacturing and production processes and techniques and research
and development information), (7) industrial designs (whether or not registered), (8) databases and data collections, (9) copies
and tangible embodiments of any of the foregoing, in whatever form or medium, (10) all rights to obtain and rights to apply for
patents, and to register trademarks and copyrights, (11) all rights in all of the foregoing provided by treaties, conventions and
common law and (12) all rights to sue or recover and retain damages and costs and attorneys’ fees for past, present and future
infringement or misappropriation of any of the foregoing (collectively, “Intellectual Property”). Either the
Company or one of its Subsidiaries is the sole and exclusive beneficial and, with respect to applications and registrations, record
owner of any Intellectual Property purported to be owned by the Company or one of its Subsidiaries and material to the conduct
of the business of the Company and its Subsidiaries, all such Intellectual Property is subsisting, valid, and enforceable, and
all such Intellectual Property is sufficient for the conduct of the business as currently conducted and as contemplated to be conducted.


 






    	 	11	 



     


    

 


(ii)             
Other than as disclosed in the Company’s Public Filings, neither the Company nor any of its Subsidiaries is party
to any contract pursuant to which the Company or any of its Subsidiaries (1) is granted or obtains or agrees to obtain any right
to use any Intellectual Property that is material to the business of the Company and its Subsidiaries (other than standard form
contracts granting rights to use readily available shrink wrap or click wrap software, (2) is restricted in its right to use or
register any Intellectual Property that is material to the business of the Company and its Subsidiaries, or (3) permits or agree
to permit any other person to use, enforce, or register any Intellectual Property that is material to the business of the Company
and its Subsidiaries including any license agreements, coexistence agreements, and covenants not to sue (each of the foregoing,
an “IP Contract”). There are no orders, writs, injunctions, or decrees to which the Company or any of its Subsidiaries
is subject with respect to any Intellectual Property that is material to the business of the Company and its Subsidiaries.


 


(iii)           
Other than as disclosed in the Company’s Public Filings, to the knowledge of the Company the conduct of the business
of the Company and its Subsidiaries (including the products and services of the Company and its Subsidiaries) as currently conducted,
and the conduct of such business as conducted in the past three (3) years (or longer time period to the extent there is any current
liability therefore), does not infringe, misappropriate, or otherwise violate, and has not infringed, misappropriated, or otherwise
violated, any person’s Intellectual Property rights. There has been no such claim asserted or threatened (including in the
form of demands or offers or invitations to obtain a license) in the past three (3) years (or longer time period to the extent
there is any current liability therefore) against the Company or any of its Subsidiaries, or, to the knowledge of the Company,
any other person. To the knowledge of the Company, there are no facts, circumstances, or conditions that could reasonably be expected
to form the basis for a claim of infringement, misappropriation, or other violation of Intellectual Property rights against the
Company or any of its Subsidiaries.


 






    	 	12	 



     


    

 


(iv)            
Other than as disclosed in the Company’s Public Filings and to the knowledge of the Company, no person is materially
infringing, misappropriating, or otherwise violating any Intellectual Property owned, used, or held for use by the Company or any
of its Subsidiaries in the conduct of the business of the Company and its Subsidiaries, and no such claims have been asserted or
threatened against any person by the Company.


 


(v)              
Other than as disclosed in the Company’s Public Filings, there has been no claim asserted or threatened challenging
the scope, validity, or enforceability of any applications or registrations for material Patents owned by the Company or any of
its Subsidiaries, and, to the knowledge of the Company, there are no facts, circumstances, or conditions that could reasonably
be expected to form the basis for such a claim. The Company has not granted any person any right to control the prosecution or
registration of any Intellectual Property owned by the Company or any of its Subsidiaries or to commence, defend, or otherwise
control any claim with respect to such Intellectual Property.


 


(vi)            
The Company takes reasonable measures to protect the confidentiality of material trade secrets, including requiring all
persons having access thereto to execute written non-disclosure agreements. To the knowledge of the Company, there has not been
any disclosure of any material trade secret of the Company (including any such information of any other person disclosed in confidence
to the Company) to any person in a manner that has resulted or is likely to result in the loss of trade secret or other rights
in and to such information. Each current and former employee and officer of the Company and its Subsidiaries has executed a proprietary
information and inventions agreement, and no current or former employee or officer of the Company or its Subsidiaries has excluded
works or inventions from his or her assignment of inventions pursuant to such employee’s or officer’s proprietary information
and inventions agreement.


 


(vii)         
To the knowledge of the Company as of the date hereof, the Company is in compliance with applicable law, as well as its
own policies, relating to privacy, data protection, and the collection and use of personal information collected, used, or held
for use by the Company, and as of the date hereof no claims are pending or threatened in writing against the Company alleging a
violation of any person’s privacy or personal information.


 


(t)                
Legal Proceedings; Governmental Orders. There are no actions pending or, to the Company’s knowledge, threatened
(a) against or by the Company or any of its Subsidiaries affecting any of their respective properties or assets; or (b) against
or by the Company or any of its Subsidiaries that challenges or seeks to prevent, enjoin or otherwise delay the transactions contemplated
by this Agreement. No event has occurred or circumstances exist that may give rise to, or serve as a basis for, any such action.
There are no outstanding governmental orders and no unsatisfied judgments, penalties or awards against or affecting the Company
or any of its properties or assets.


 






    	 	13	 



     


    

 


(u)              
Compliance With Laws; Permits. The Company and each of its Subsidiaries has complied, and is now complying, with
all laws applicable to it or its business, properties or assets. All permits required for the Company or its Subsidiaries to conduct
their businesses have been obtained by it and are valid and in full force and effect. All fees and charges with respect to such
permits as of the date hereof have been paid in full. No event has occurred that, with or without notice or lapse of time or both,
would reasonably be expected to result in the revocation, suspension, lapse or limitation of any permit described herein.


 


(v)              
Labor; Employee Benefit Matters. The Company has disclosed in its Public Filings all pension, benefit, retirement,
compensation, employment, consulting, profit-sharing, deferred compensation, incentive, bonus, performance award, phantom equity,
stock or stock-based, change in control, retention, severance, vacation, paid time off, welfare, fringe-benefit and other similar
agreement, plan, policy, program or arrangement (and any amendments thereto), in each case whether or not reduced to writing and
whether funded or unfunded, which is or has been maintained, sponsored, contributed to, or required to be contributed to by the
Company for the benefit of any current or former employee, officer, director, retiree, independent contractor or consultant of
the Company or any spouse or dependent of such individual, or under which the Company has or may have any liability, contingent
or otherwise (each, a “Benefit Plan”). None of the Company or any of its Subsidiaries is a party to any collective
bargaining, trade union or works council agreement or other labor union contract applicable to persons employed by them, and there
are no organizational campaigns, petitions or other unionization activities seeking recognition of a collective bargaining unit
relating to any employee. None of the Company or any of its Subsidiaries is in material violation of any law pertaining to employment
and employment practices, including all laws respecting terms and conditions of employment, wages, hours, overtime payment, employment
discrimination, worker classification (including the proper classification of workers as independent contractors, consultants,
dispatch labor, outsourced workers, and classification under alternative working hours systems), immigration, work authorization,
occupational health and safety, workers’ compensation, the payment of social security and other employment taxes, disability
rights or benefits, plant closures and layoffs, labor relations, employee leave issues and unemployment insurance. Each of the
Company and its Subsidiaries has, in a timely manner, (i) withheld and paid to the appropriate governmental authority all amounts
required by applicable laws to be withheld from any employee, including the withholding and payment of all individual income taxes
and contributions to social security and housing fund accounts payable by such employee (if any); (ii) paid in full to the appropriate
governmental authority all amounts required by applicable laws to be paid, including the payment of all contributions to social
security and housing fund accounts payable by any of the Company or its Subsidiaries; and (iii) paid in full to each employee all
amounts payable by virtue of applicable employment laws and terms of employment applicable to such employee, including all wages,
overtime payments, bonuses, benefits, severance payments and all compensation due to such employee. To the Company’s knowledge,
no employee or contractor of any of the Company or its Subsidiaries is in any material respect in violation of any term of any
employment agreement, consulting agreement, restrictive covenant, common law nondisclosure obligation, fiduciary duty, or other
obligation to any such entity. No current employee or contractor of any of the Company or its Subsidiaries is entitled to any payment
(including without limitation any severance payment, change of control payment or other bonus payment) tied to the announcement
or consummation of the transactions contemplated by this Agreement.


 






    	 	14	 



     


    

 


(w)            
Brokers. No broker, finder or investment banker is entitled to any brokerage, finder’s or other fee or commission
in connection with the transactions contemplated by this Agreement based upon arrangements made by or on behalf of the Company.


 


(x)              
Related Party Transactions. Except as disclosed in the Company’s Public Filings, there are no business relationships
or related party transactions involving the Company or any other person required to be described in the Public Filings that have
not been described as required.


 


(y)              
Securities Sold Pursuant to this Agreement. The Shares have been duly authorized for issuance and sale and, when
issued and paid for, will be validly issued, fully paid and non-assessable; the holders thereof are not and will not be subject
to personal liability by reason of being such holders; the Shares are not and will not be subject to the preemptive rights of any
holders of any security of the Company or similar contractual rights granted by the Company; and all corporate action required
to be taken for the authorization, issuance and sale of the Securities has been duly and validly taken.


 


(z)              
Internal Controls. Except as described in Public Filings, the Company has at all times maintained and agrees to maintain
books and records that accurately reflect its assets and transactions in reasonable detail, and a system of internal accounting
controls sufficient to provide reasonable assurances that: (i) transactions are executed in accordance with management’s
general or specific authorization; (ii) transactions are recorded as necessary in order to permit preparation of financial statements
in accordance with U.S. GAAP and to maintain accountability for assets; (iii) access to assets is permitted only in accordance
with management’s general or specific authorization; and (iv) the recorded accountability for assets is compared with existing
assets at reasonable intervals and appropriate action is taken with respect to any differences. Neither the Board of Directors
nor the audit committee has been informed, nor is any director of the Company aware, of: (i) any significant deficiencies and material
weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect
the Company’s ability to record, process, summarize and report financial information; or (ii) any fraud, whether or not material,
that involves management or other employees who have a significant role in the Company’s internal control over financial
reporting.


 


(aa)           
Conduct of Business. Except as described in Public Filings, the Company has all requisite corporate power and authority,
and has all necessary authorizations, approvals, orders, licenses, certificates and permits of and from all governmental regulatory
officials and bodies that it needs as of the date hereof to conduct its business purpose as described in Public Filings, except
where any failures to possess the same, singularly or in the aggregate, would have a Material Adverse Effect. The disclosures in
Public Filings concerning the effects of federal, state, local and foreign regulation on the Company’s business purpose as
currently contemplated are correct in all material respects.


 






    	 	15	 



     


    

 


4.                 
COVENANTS.


 


(a)              
Best Efforts. Each party shall use its best efforts to timely satisfy each of the conditions to be satisfied by it
as provided in Sections 5 and 6 of this Agreement.


 


(b)              
Form D. The Company agrees to timely file a Form D with respect to the Shares as required under Regulation D. The
Company shall also take such action as the Company and the Buyer shall reasonably determine is necessary in order to obtain an
exemption for or to qualify the Shares for sale to the Buyer at the Closing pursuant to this Agreement under applicable securities
laws of the United States (or to obtain an exemption from such qualification). The Company shall make all filings and reports relating
to the offer and sale of the Shares required under applicable securities laws of the United States following the Closing Date.


 


(c)              
Conduct of Business Prior to the Closing. From the date hereof until the Closing, except as otherwise provided in
this Agreement or consented to in writing by Buyer (which consent shall not be unreasonably withheld or delayed), Company shall
(x) conduct its business in the ordinary course of business consistent with past practice; and (y) use reasonable best efforts
to maintain and preserve intact its current organization, business and franchise and to preserve the rights, franchises, goodwill
and relationships of its employees, customers, lenders, suppliers, regulators and others having business relationships with the
Company and shall not, in addition to any other action that does not fall within the Company’s ordinary course of business
consistent with past practice, undertake any of the actions enumerated under Section 3(p). Without limiting the foregoing, the
Company shall not (i) except as necessary within the Company’s ordinary course of business consistent with past practice,
grant or acquire, agree to grant to or acquire from any person, or dispose of or permit to lapse any rights to any material Intellectual
Property, or disclose or agree to disclose to any person, any material trade secret, (ii) compromise, settle or agree to settle,
or consent to judgment in, any one or more actions or institute any action concerning any material Intellectual Property, or (iii)
cause any current employee or contractor of any of the Company or its Subsidiaries to be entitled to any payment (including without
limitation any severance payment, change of control payment or other bonus payment) tied to the announcement or consummation of
the transactions contemplated by this Agreement.


 


(d)              
Access to Information. From the date hereof until the Closing, the Company shall (a) afford Buyer and its representatives
full and free access to and the right to inspect all of the corporate books and records and other documents and data related to
the Company; (b) furnish Buyer and its representatives with such financial, operating and other data and information related to
the Company as Buyer or any of its representatives may reasonably request; and (c) cooperate with Buyer and its representatives
in their investigation of the Company. Any investigation pursuant to this Section 4(d) shall be conducted in such manner as not
to interfere unreasonably with the conduct of the business of the Company.


 


(e)              
Notice of Certain Events. From the date hereof until the Closing, each party shall promptly notify the other party
in writing of:


 






    	 	16	 



     


    

 


(i)                
any fact, circumstance, event or action the existence, occurrence or taking of which (A) has had, or could reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect or materially delay the consummation of the transactions
contemplated by this Agreement, or (B) has resulted in, or could reasonably be expected to result in, any representation or warranty
made by such party hereunder not being true and correct;


 


(ii)             
any notice or other communication from any governmental authority in connection with the transactions contemplated by this
Agreement; and


 


(iii)           
any actions commenced or, to such party’s knowledge, threatened against, relating to or involving or otherwise affecting
the Company or Buyer that, if pending, would have been required to have been disclosed under applicable laws or that relates to
the consummation of the transactions contemplated by this Agreement.


 


(f)               
Public Announcements. Unless otherwise required by applicable law or NASDAQ stock exchange requirements (based upon
the reasonable advice of counsel), no party to this Agreement shall make any public announcements in respect of this Agreement
or the transactions contemplated hereby or otherwise communicate with any news media without the prior written consent of the other
party (which consent shall not be unreasonably withheld or delayed), and the parties shall use commercially reasonable efforts
to cooperate as to the timing and contents of any such announcement.


 


(g)              
Continuity of Company’s Business and Management. The parties intend that, following completion of the sale
of Shares to the Buyer, the Company will continue to operate as currently operated. The parties further agree that the primary
business of the Company will continue for a period of at least five (5) years following Closing unless the conduct of such business
shall become illegal or shall be determined by the Board of Directors to be not in the best interest of the shareholders.


 


(h)              
Dilutive Issuances. From the date of the Agreement through the Closing Date, the Company shall not, and shall cause
its Subsidiaries not to, 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, any debt, preferred shares or any purchase rights),
or accelerate the vesting thereof (except to the extent required under the terms of the award agreement applicable thereto). If
the Company or any of its Subsidiaries shall have issued, offered, sold, or granted any of the foregoing, the number of Shares
to be received by the Buyer at the Closing shall be equitably adjusted such that as of the Closing the Buyer shall own the same
percentage of all outstanding equity interests in the Company and its Subsidiaries as if such dilutive issuance has never occurred.
Notwithstanding the foregoing, this Section 4(i) shall not prohibit the issuance of shares upon exercise of outstanding options
under such plans in the ordinary course of business consistent with past practice; provided, however, that the Company shall not
accelerate the vesting of any Company stock option or Company restricted stock except to the extent required under the terms of
the award agreement applicable thereto.


 






    	 	17	 



     


    

 


5.                 
CONDITIONS TO THE COMPANY’S OBLIGATION TO SELL. The obligation of the Company hereunder to issue and allot
the Shares to the 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 the Buyer with prior written notice thereof:


 


(i)                
Such Buyer shall have delivered to the Company (a) the Agreement, executed by such individuals as are authorized to act
on behalf of the Buyer; and (b) such closing certificates as may be reasonably required by the Company in connection with the Closing.


 


(ii)             
Such Buyer shall have delivered to the Company the Purchase Price for the Shares being purchased by such Buyer at the Closing
by wire transfer of immediately available funds pursuant to the wire instructions provided by the Company.


 


(iii)           
The representations and warranties of such Buyer shall be true and correct in all material respects (except for those representations
and warranties that are qualified by materiality or Material Adverse Effect, which shall be true and correct in all respects) as
of the date when made and as of the Closing Date as though 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 specified 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.


 


6.                 
CONDITIONS TO THE BUYER’S OBLIGATION TO PURCHASE. The obligation of the Buyer hereunder to purchase the Shares
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 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 representations and warranties of the Company shall be true and correct in all material respects (except for those representations
and warranties that are qualified by materiality or Material Adverse Effect, which shall be true and correct in all respects) as
of the date when made and as of the Closing Date as though 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 specified date) and the Company 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 the Company at or prior to the Closing Date.


 






    	 	18	 



     


    

 


(ii)             
The Shares (i) shall be designated for quotation or listed on the Principal Market and (ii) shall not have been suspended,
as of the Closing Date, by the SEC or the Principal Market from trading on the Principal Market.


 


(iii)           
The Company shall have obtained all governmental, regulatory or third party consents and approvals, if any, necessary for
the sale of the Shares.


 


(iv)            
The Company shall have delivered the following to the Buyer: (a) closing deliverables set forth in Section 1(e); (b) the
Agreement, executed by such individuals as are authorized to act on behalf of the Company; and (c) such certificates and other
instruments as may be reasonably required by the Buyer in connection with the Closing.


 


(v)              
No event has occurred with regard to the Company or its Subsidiaries that would have or be reasonably expected to have a
Material Adverse Effect on the business of the Company or such Subsidiaries.


 


7.                 
MISCELLANEOUS.


 


(a)              
Governing Law; Jurisdiction; Jury Trial. All questions concerning the construction, validity, enforcement and interpretation
of this Agreement shall be governed by the laws of the Cayman Islands, without giving effect to any choice of law or conflict of
law provision or rule (whether of Cayman Islands or any other jurisdictions) that would cause the application of the laws of any
jurisdictions other than the Cayman Islands. Each party hereby irrevocably submits to the exclusive jurisdiction of the state and
federal courts sitting in the City of Richmond, Virginia for the adjudication of any dispute hereunder or in connection herewith
or with any transaction contemplated hereby or discussed herein, 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.


 


(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; provided that a facsimile signature shall be considered due execution and shall be binding upon the signatory thereto with
the same force and effect as if the signature were an original, not a facsimile signature.


 


(c)              
Headings. The headings of this Agreement are for convenience of reference and shall not form part of, or affect the
interpretation of, this Agreement.


 


(d)              
Severability. If any provision of this Agreement shall be invalid or unenforceable in any jurisdiction, such invalidity
or unenforceability shall not affect the validity or enforceability of the remainder of this Agreement in that jurisdiction or
the validity or enforceability of any provision of this Agreement in any other jurisdiction.


 






    	 	19	 



     


    

 


(e)              
Entire Agreement; Amendments. This Agreement supersedes all other prior oral or written agreements between the Buyer,
the Company, their affiliates and persons acting on their behalf with respect to the matters discussed herein, and this Agreement
contain the entire understanding of the parties with respect to the matters covered herein and, except as specifically set forth
herein, neither the Company nor any Buyer makes any representation, warranty, covenant or undertaking with respect to such matters.
No provision of this Agreement may be amended other than by an instrument in writing signed by the parties hereto. No provision
hereof may be waived other than by an instrument in writing signed by the party against whom enforcement is sought.


 


(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 (iii) one Business Day after deposit with an overnight courier service, in each case properly
addressed to the party to receive the same. The addresses and facsimile numbers for such communications shall be:


 


If to the Company:


 


Recon Technology, Ltd

Room 1902, Building C, King Long International Mansion

No. 9 Fulin Road

Beijing, 100107

People’s Republic of China

Attention:     Shenping Yin, Chief Executive Officer


 


Copy (for informational purposes only) to:


 


Kaufman & Canoles, P.C.

Two James Center, 14th Floor

1021 East Cary Street

Richmond, Virginia 23219

Telephone:(804) 771-5700

Facsimile:(804) 771-5777

Attention:     Anthony W. Basch, Esq.


 


If to the Buyer, to such 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 the
Company five (5) days prior to the effectiveness of such change. 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 containing the time, date, recipient facsimile number and 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.


 


Any document shall be
deemed to have been duly served if marked for the attention of the agent for service of process at its address (as set forth in
this Section 7(f)) or such other address in the United States as may be notified to the party wishing to serve the document and
delivered in accordance with the notice provisions set forth in this Section 7(f).


 






    	 	20	 



     


    

 


(g)              
Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their respective
successors and assigns.


 


(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.


 


(i)                
Survival. The representations and warranties of the Buyer and the Company contained in Sections 2 and 3 shall survive
for two (2) years following the Closing and the agreements and covenants set forth in Sections 4 shall survive until the Closing
(unless the provision specifically contemplates performance subsequent to the Closing). Notwithstanding anything in this Agreement
to the contrary, for the sole purpose of determining the amount of any liability hereunder, the representations and warranties
contained in Article 3 shall be deemed to have been made without being qualified by “materiality” or “Material
Adverse Effect” or similar qualifications, and for the sole purpose of determining whether any misrepresentation or breach
of representations or warranties have occurred, any qualification contained in such representation or warranty relating to “materiality”
or “Material Adverse Effect” shall be construed to mean an amount in excess of US$50,000. Without limiting the foregoing,
if the Company’s actions or the actions of anyone acting on the Company’s behalf prior to Closing result in the assessment
of fines, penalties, or disgorgement of profits against the Buyer or its Affiliates or representatives for violation of applicable
laws, the Company hereby agrees to indemnify the Buyer and its Affiliates and representatives for same, as well as any costs or
fees incurred in investigating, remediating, responding to government inquiries or investigations, or defending against legal claims
relating to such actions.


 


(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)              
No Strict 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.


 


[Share Purchase Agreement Signature Pages
Follow]


 


 




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[Share Purchase Agreement
Signature Page - Company]


 


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


 


	 	COMPANY:
	 	 
	 	Recon Technology, Ltd
	 	 	 
	 	 	 
	 	By:	
        /s/ Shenping Yin

	 	Name:	Shenping Yin
	 	Its:	Chief Executive Officer


 


 




    	 	22	 



     


    

 


[Share Purchase Agreement
Signature Page – Buyer]


 


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


 


	 	BUYER:
	 	 
	 	Yongquan Bi
	 	 	 
	 	By:	
        /s/ Yongquan Bi



 








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