Exhibit
10.1


 


SECURITIES
PURCHASE AGREEMENT


 


This
SECURITIES PURCHASE AGREEMENT (this “Agreement”), dated as of July 15, 2021, is by and among Dogness (International)
Corporation, a British Virgin Islands company with headquarters located at No. 16, N. Dongke Rd., Tongsha Industrial Zone, Dongguan,
Guangdong 523000, People’s Republic of 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 desire to enter into this transaction to purchase the Securities (as defined below) pursuant to a currently
effective shelf registration statement on Form F-3, which has at least $80.5 million of unallocated securities (Registration Number 333-229505)
(the “Registration Statement”), which Registration Statement has been declared effective in accordance with the Securities
Act of 1933, as amended (the “1933 Act”), by the United States Securities and Exchange Commission (the “SEC”).


 


B.
Each Buyer wishes to purchase, and the Company wishes to sell, upon the terms and conditions stated in this Agreement, such aggregate
number of Common Shares as set forth opposite such Buyer’s name in column (3) on the Schedule of Buyers (which aggregate amount
for all Buyers shall be 2,178,120 Common Shares and shall collectively be 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 COMMON SHARES.


 


(a)
Purchase of Securities. 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) such aggregate number of Securities as is set forth opposite such Buyer’s name in column (3) on the Schedule
of Buyers.


 


(b)
Closing. The closing (the “Closing”) of the purchase of the Securities by the Buyers shall occur at the offices
of Kelley Drye & Warren LLP, 3 World Trade Center, 175 Greenwich Street, New York, NY 10007. 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 (as defined below) 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 Saturday, Sunday or other day
on which commercial banks in The City of New York are authorized or required by law to remain closed; provided, however,
for clarification, commercial banks shall not be deemed to be authorized or required by law to remain closed due to “stay at home”,
“shelter-in-place”, “non-essential employee” or any other similar orders or restrictions or the closure of any
physical branch locations at the direction of any governmental authority so long as the electronic funds transfer systems (including
for wire transfers) of commercial banks in The City of New York generally are open for use by customers on such day.


 




    	 



     


    

 


(c)
Purchase Price. The aggregate purchase price for the Securities to be purchased by each Buyer (the “Purchase Price”)
shall be the amount set forth opposite such Buyer’s name in column (4) on the Schedule of Buyers.


 


(d)
Form of Payment; Deliveries. On the Closing Date, (i) each Buyer shall pay its respective Purchase Price to the Company for the
Securities 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) (less, in the case of the lead Buyer, the amounts withheld pursuant to Section 4(j)) and (ii)
the Company shall cause Transhare Corporation (together with any subsequent transfer agent, the “Transfer Agent”)
through the Depository Trust Company (“DTC”) Fast Automated Securities Transfer Program, to credit such aggregate
number of Securities that each Buyer is purchasing as is set forth opposite such Buyer’s name in column (3) of the Schedule of
Buyers to such Buyer’s or its designee’s balance account with DTC through its Deposit/Withdrawal at Custodian system, duly
executed on behalf of the Company and registered in the name of such Buyer or its designee.


 


(e)
Sales During Pre-Settlement Period. Notwithstanding anything herein to the contrary, if at any time on or after the time of execution
of this Agreement by the Company and an applicable Buyer, through, and including the time immediately prior to the Closing (the “Pre-Settlement
Period”), such Buyer sells (excluding “short sales” as defined in Rule 200 of Regulation SHO) to any Person all,
or any portion, of any Securities to be issued hereunder to such Buyer at the Closing (collectively, the “Pre-Settlement Securities”),
such Buyer shall, automatically hereunder (without any additional required actions by such Buyer or the Company), be deemed to be unconditionally
bound to purchase, and the Company shall be deemed unconditionally bound to sell, such Pre-Settlement Securities to such Buyer at the
Closing; provided, that the Company shall not be required to deliver any Pre-Settlement Securities to such Buyer prior to the Company’s
receipt of the purchase price of such Pre-Settlement Securities hereunder; and provided further that the Company hereby acknowledges
and agrees that the foregoing shall not constitute a representation or covenant by such Buyer as to whether or not during the Pre-Settlement
Period such Buyer shall sell any Securities to any Person and that any such decision to sell any Securities by such Buyer shall be made,
in the sole discretion of such Buyer, at the time such Buyer elects to effect any such sale, if any.


 




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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.


 


(b)
Validity; Enforcement. This Agreement has 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 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.


 


(c)
No Conflicts. The execution, delivery and performance by such Buyer of this Agreement and the consummation by such Buyer of the
transactions contemplated hereby will not (i) result in a violation of the organizational documents of such 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 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.


 


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, (A) owns any of the outstanding share capital or holds any equity or similar
interest of such Person or (B) 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.
The execution and delivery of this Agreement and the other Transaction Documents by the Company and the consummation by the Company of
the transactions contemplated hereby and thereby (including, without limitation, the issuance of the Securities) have been duly authorized
by the Company’s board of directors and (other than the filing with the SEC of the prospectus supplement required by the Registration
Statement pursuant to Rule 424(b) under the 1933 Act (the “Prospectus Supplement”) supplementing the base prospectus
forming part of the Registration Statement (the “Prospectus”) 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 board of directors or its shareholders
or other governing body. This Agreement has been, and the other Transaction Documents 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. “Transaction Documents” means, collectively, this Agreement, the Securities, 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; Registration Statement. The issuance of the Securities is duly authorized and, upon issuance and payment
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. The issuance by the Company of
the Securities has been registered under the 1933 Act, the Securities are being issued pursuant to the Registration Statement and all
of the Securities are freely transferable and freely tradable by each of the Buyers without restriction, whether by way of registration
or some exemption therefrom. The Registration Statement is effective and available for the issuance of the Securities thereunder and
the Company has not received any notice that the SEC has issued or intends to issue a stop-order with respect to the Registration Statement
or that the SEC otherwise has suspended or withdrawn the effectiveness of the Registration Statement, either temporarily or permanently,
or intends or has threatened in writing to do so. The “Plan of Distribution” section under the Registration Statement permits
the issuance and sale of the Securities hereunder and as contemplated by the other Transaction Documents. Upon receipt of the Securities,
each of the Buyers will have good and marketable title to the Securities. The Registration Statement and any prospectus included therein,
including the Prospectus and the Prospectus Supplement, complied in all material respects with the requirements of the 1933 Act and the
Securities Exchange Act of 1934, as amended (the “1934 Act”) and the rules and regulations of the SEC promulgated
thereunder and all other applicable laws and regulations. At the time the Registration Statement and any amendments thereto became effective,
at the date of this Agreement and at each deemed effective date thereof pursuant to Rule 430B(f)(2) of the 1933 Act, the Registration
Statement and any amendments thereto complied and will comply in all material respects with the requirements of the 1933 Act and did
not and will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading. The Prospectus and any amendments or supplements thereto (including, without
limitation the Prospectus Supplement), at the time the Prospectus or any amendment or supplement thereto was issued and at the Closing
Date, complied, and will comply, in all material respects with the requirements of the 1933 Act and did not, and will not, contain
any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light
of the circumstances under which they were made, not misleading. The Company meets all of the requirements for the use of Form F-3 under
the 1933 Act for the offering and sale of the Securities contemplated by this Agreement and the other Transaction Documents, and the
SEC has not notified the Company of any objection to the use of the form of the Registration Statement pursuant to Rule 401(g)(1) under
the 1933 Act. The Registration Statement meets the requirements set forth in Rule 415(a)(1)(x) under the 1933 Act. At the earliest time
after the filing of the Registration Statement that the Company or another offering participant made a bona fide offer (within the meaning
of Rule 164(h)(2) under the 1933 Act) relating to any of the Securities, the Company was not and is not an “Ineligible Issuer”
(as defined in Rule 405 under the 1933 Act). The Company (i) has not distributed any offering material in connection with the offer or
sale of any of the Securities and (ii) until no Buyer holds any of the Securities, shall not distribute any offering material in connection
with the offer or sale of any of the Securities to, or by, any of the Buyers (if required), in each case, other than the Registration
Statement, the Prospectus or the Prospectus Supplement.


 


(d)
No Conflicts. The execution, delivery and performance of the Transaction Documents by the Company and the consummation by the
Company of the transactions contemplated hereby and thereby (including, without limitation, the issuance of the Securities) will not
(i) result in a violation of the Articles of Association (as defined below) (including, without limitation, any certificate of designation
contained therein), Memorandum of Association (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 Global Market (the “Principal Market”) and including all applicable foreign,
federal and state laws, rules and regulations) 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 the Prospectus Supplement, the filing of Form LAS with the Nasdaq
Global Market 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 Common Shares in the next twelve (12) months after the date of this Agreement; provided, however, that the Company’s most recent
annual report on Form 20-F contains a going concern limitation. “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 promulgated under the 1933 Act (or a successor rule thereto) (collectively, “Rule 144”)) of
the Company or any of its Subsidiaries or (iii) to its knowledge, a “beneficial owner” of more than 10% of the Common Shares
(as defined for purposes of Rule 13d-3 of 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 decision to enter into the Transaction Documents
has been based solely on the independent evaluation by the Company and its representatives.


 


(g)
Placement Agent’s Fees. 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 cause this offering of the Securities to require approval of shareholders of the Company 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 cause the offering of any of the Securities to be integrated
with other offerings of securities of the Company.


 


(i)
[Reserved].


 


(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 Common Shares or a change in control of the Company or any of its Subsidiaries.


 




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(k)
SEC Documents; Financial Statements. During the two (2) years prior 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 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.


 


(l)
Absence of Certain Changes. Since the date of the Company’s most recent audited financial statements contained in a Form
20-F, 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 a Form 20-F, neither the Company nor any of its
Subsidiaries has (i) declared or paid any dividends, (ii) 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, 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.


 




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(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 Common 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.


 


(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 Common Shares by the Principal Market in the foreseeable future. During the two years prior to the date hereof, (i)
the Common Shares have been listed or designated for quotation on the Principal Market, (ii) trading in the Common Shares have 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 Common Shares from the Principal Market. 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. 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.


 




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(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.


 


(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. Other than as disclosed on Schedule 3(q) attached hereto, 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 stock or Common Shares, as applicable,
of a company whose securities are traded on or quoted through an Eligible Market (as defined below)), 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. Other than as disclosed in the SEC Reports, 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).


 




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(r)
Equity Capitalization.


 


(i)
Definitions:


 


(A)
“Common Shares” means (x) the Company’s Class A common shares, $0.002 par value per share, and (y) any share
capital into which such Common Shares shall have been changed or any share capital resulting from a reclassification of such Common Shares.


 


(B)
“Class B Common Shares” means (x) the Company’s Class B Common shares, $0.002 par value per share, the terms
of which may be designated by the board of directors of the Company in a certificate of designations and (y) any share capital into which
such preferred shares shall have been changed or any share capital resulting from a reclassification of such preferred shares (other
than a conversion of such preferred shares into Common Shares in accordance with the terms of such certificate of designations).


 


(ii)
Authorized and Outstanding Share Capital. As of the date hereof, the authorized share capital of the Company consists of (A) 90,931,000
shares of Common Shares, of which, 20,299,761 are issued and outstanding and 2,003,975 shares are reserved for issuance pursuant to Convertible
Securities (as defined below) (other than the Securities) exercisable or exchangeable for, or convertible into, Common Shares, and (b)
9,069,000 Class B Common Shares, all of which are issued and outstanding.


 


(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 Common Shares that are
(A) reserved for issuance pursuant to Convertible Securities (as defined below) 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 Common 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.
Other than as stated on Schedule 3(r)(iii), to the Company’s knowledge, no Person owns 10% or more of the Company’s issued
and outstanding Common 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 Schedule 3(r)(iv): (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 this 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
bylaws, 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 set forth in the SEC Documents,
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; (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; and (z) “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.


 


(t)
Litigation. Except as disclosed on Schedule 3(t) attached hereto, 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 Common
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, which is outside of the ordinary course of business or individually or in the aggregate material to the
Company or any of its Subsidiaries. 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, including, without limitation, the Registration Statement. 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. 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, (b) zoning laws and other land use restrictions that do not impair the present or anticipated use of the
property subject thereto and (c) mortgages securing certain of the Company’s debt. 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.


 




    	14



     


    

 


(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, (b) zoning laws and other land use restrictions that do not impair the present or anticipated use of the property
subject thereto and (c) Liens securing certain of the Company’s debt.


 


(x)
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. Except as set forth in Schedule 3(x)(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.


 


(y)
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.


 




    	15



     


    

 


(ii)
No Hazardous Materials:


 


(A)
have been disposed of or otherwise released into any Real Property (as defined below) in violation of any Environmental Laws; or


 


(B)
are present on, over, beneath, in or upon any 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 any Hazardous Materials on any Real Property, including, without limitation, such substances as asbestos and
polychlorinated biphenyls.


 


(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.


 


(z)
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.


 


(aa)
Tax Status. Except as disclosed in the SEC Reports, 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 U.S. Internal Revenue Code of 1986, as amended (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.


 




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(bb)
Internal Accounting and Disclosure Controls. Except as disclosed on Schedule 3(bb), 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.
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. 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.


 


(cc)
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.


 


(dd)
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.


 


(ee)
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 Common 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 Common Shares upon exercise or exchange, as applicable, of the Securities
as and when required pursuant to the Transaction Documents for purposes of effecting trading in the Common 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 Common Shares) at various times during the period that the Securities
are outstanding and such hedging and/or trading activities (including, without limitation, the location and/or reservation of borrowable
Common 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 or any other Transaction Document or any of the documents executed in connection
herewith or therewith.


 




    	17



     


    

 


(ff)
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) other than as set forth in Schedule 3(ff) hereto, paid or agreed to pay any Person for research
services with respect to any securities of the Company or any of its Subsidiaries.


 


(gg)
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.


 


(hh)
Registration Eligibility. The Company is eligible to register the issuance of the Securities by the Company using Form F-3 promulgated
under the 1933 Act.


 


(ii)
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.


 


(jj)
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.


 


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


 




    	18



     


    

 


(ll)
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.


 


(mm)
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, but not limited to, the laws,
regulations and Executive Orders and sanctions programs administered by the U.S. Office of Foreign Assets Control, including, without
limitation, (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.


 


(nn)
Management. Except as set forth in Schedule 3(nn) 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;


 




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(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;


 


(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.


 


(oo)
Shares Option Plans. Except as disclosed in Schedule 3(oo), 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 Common 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.


 


(pp)
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.


 


(qq)
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.


 




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(rr)
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.


 


(ss)
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.


 


(tt)
Registration Rights. No holder of securities of the Company has rights to the registration of any securities of the Company because
of the filing of the Registration Statement or the issuance of the Securities hereunder that could expose the Company to material liability
or any Buyer to any liability or that could impair the Company’s ability to consummate the issuance and sale of the Securities
in the manner, and at the times, contemplated hereby, which rights have not been waived by the holder thereof as of the date hereof.


 


(uu)
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. 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. All financial projections and forecasts that have been prepared
by or on behalf of the Company or any of its Subsidiaries and made available to you have been prepared in good faith based upon reasonable
assumptions and represented, at the time each such financial projection or forecast was delivered to each Buyer, the Company’s
best estimate of future financial performance (it being recognized that such financial projections or forecasts are not to be viewed
as facts and that the actual results during the period or periods covered by any such financial projections or forecasts may differ from
the projected or forecasted results). 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)
Amendments to the Registration Statement; Prospectus Supplements; Free Writing Prospectuses.


 


(i)
Amendments to the Registration Statement; Prospectus Supplements; Free Writing Prospectuses. Except as provided in this Agreement
and other than periodic reports required to be filed pursuant to the 1934 Act, the Company shall not file with the SEC any amendment
to the Registration Statement that relates to the Buyer, this Agreement or the transactions contemplated hereby or thereby or file with
the SEC any Prospectus Supplement that relates to the Buyer, this Agreement or the transactions contemplated hereby or thereby with respect
to which (a) the Buyer shall not previously have been advised, (b) the Company shall not have given due consideration to any comments
thereon received from the Buyer or its counsel, or (c) the Buyer shall reasonably object after being so advised, unless the Company reasonably
has determined that it is necessary to amend the Registration Statement or make any supplement to the Prospectus to comply with the 1933
Act or any other applicable law or regulation, in which case the Company shall promptly (but in no event later than 24 hours) so inform
the Buyer, the Buyer shall be provided with a reasonable opportunity to review and comment upon any disclosure relating to the Buyer
and the Company shall expeditiously furnish to the Buyer an electronic copy thereof. In addition, for so long as, in the reasonable opinion
of counsel for the Buyer, the Prospectus (or in lieu thereof, the notice referred to in Rule 173(a) under the 1933 Act) is required to
be delivered in connection with any acquisition or sale of Securities by the Buyer, the Company shall not file any Prospectus Supplement
with respect to the Securities without delivering or making available a copy of such Prospectus Supplement, together with the Prospectus,
to the Buyer promptly.


 


(ii)
The Company has not made, and agrees that unless it obtains the prior written consent of the Buyer it will not make, an offer relating
to the Securities that would constitute an “issuer free writing prospectus” as defined in Rule 433 promulgated under the
1933 Act (an “Issuer Free Writing Prospectus”) or that would otherwise constitute a “free writing prospectus”
as defined in Rule 405 promulgated under the 1933 Act (a “Free Writing Prospectus”) required to be filed by the Company
or the Buyer with the SEC or retained by the Company or the Buyer under Rule 433 under the 1933 Act. The Buyer has not made, and agrees
that unless it obtains the prior written consent of the Company it will not make, an offer relating to the Securities that would constitute
a Free Writing Prospectus required to be filed by the Company with the SEC or retained by the Company under Rule 433 under the 1933 Act.
Any such Issuer Free Writing Prospectus or other Free Writing Prospectus consented to by the Buyer or the Company is referred to in this
Agreement as a “Permitted Free Writing Prospectus.” The Company agrees that (x) it has treated and will treat, as
the case may be, each Permitted Free Writing Prospectus as an Issuer Free Writing Prospectus and (y) it has complied and will comply,
as the case may be, with the requirements of Rules 164 and 433 under the 1933 Act applicable to any Permitted Free Writing Prospectus,
including in respect of timely filing with the SEC, legending and record keeping.


 




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(c)
Prospectus Delivery. Immediately prior to execution of this Agreement, the Company shall have delivered to the Buyer, and as soon
as practicable after execution of this Agreement the Company shall file, Prospectus Supplements with respect to the Securities to be
issued on the Closing Date, as required under, and in conformity with, the 1933 Act, including Rule 424(b) thereunder. The Company shall
provide the Buyer a reasonable opportunity to comment on a draft of each Prospectus Supplement and any Issuer Free Writing Prospectus,
shall give due consideration to all such comments and, subject to the provisions of Section 4(b) hereof, shall deliver or make available
to the Buyer, without charge, an electronic copy of each form of Prospectus Supplement, together with the Prospectus, and any Permitted
Free Writing Prospectus on the Closing Date. The Company consents to the use of the Prospectus (and of any Prospectus Supplements thereto)
in accordance with the provisions of the 1933 Act and with the securities or “blue sky” laws of the jurisdictions in which
the Securities may be sold by the Buyer, in connection with the offering and sale of the Securities and for such period of time thereafter
as the Prospectus (or in lieu thereof, the notice referred to in Rule 173(a) under the 1933 Act) is required by the 1933 Act to be delivered
in connection with sales of the Securities. If during such period of time any event shall occur that in the judgment of the Company and
its counsel is required to be set forth in the Registration Statement or the Prospectus or any Permitted Free Writing Prospectus or should
be set forth therein in order to make the statements made therein (in the case of the Prospectus, in light of the circumstances under
which they were made) not misleading, or if it is necessary to amend the Registration Statement or supplement or amend the Prospectus
or any Permitted Free Writing Prospectus to comply with the 1933 Act or any other applicable law or regulation, the Company shall forthwith
prepare and, subject to Section 4(b) above, file with the SEC an appropriate amendment to the Registration Statement or Prospectus Supplement
to the Prospectus (or supplement to the Permitted Free Writing Prospectus) and shall expeditiously furnish or make available to the Buyer
an electronic copy thereof.


 


(d)
Stop Orders. The Company shall advise the Buyer promptly (but in no event later than 24 hours) and shall confirm such advice in
writing: (i) of the Company’s receipt of notice of any request by the SEC for amendment of or a supplement to the Registration
Statement, the Prospectus, any Permitted Free Writing Prospectus or for any additional information; (ii) of the Company’s receipt
of notice of the issuance by the SEC of any stop order suspending the effectiveness of the Registration Statement or prohibiting or suspending
the use of the Prospectus or any Prospectus Supplement, or of the suspension of qualification of the Securities for offering or sale
in any jurisdiction, or the initiation or contemplated initiation of any proceeding for such purpose; (iii) of the Company becoming aware
of the happening of any event, which makes any statement of a material fact made in the Registration Statement, the Prospectus or any
Permitted Free Writing Prospectus untrue or which requires the making of any additions to or changes to the statements then made in the
Registration Statement, the Prospectus or any Permitted Free Writing Prospectus in order to state a material fact required by the 1933
Act to be stated therein or necessary in order to make the statements then made therein (in the case of the Prospectus, in light of the
circumstances under which they were made) not misleading, or of the necessity to amend the Registration Statement or supplement the Prospectus
or any Permitted Free Writing Prospectus to comply with the 1933 Act or any other law or (iv) if at any time following the date hereof
the Registration Statement is not effective or is not otherwise available for the issuance of the Securities or any Prospectus contained
therein is not available for use for any other reason. Thereafter, the Company shall promptly notify such holders when the Registration
Statement, the Prospectus, any Permitted Free Writing Prospectus and/or any amendment or supplement thereto, as applicable, is effective
and available for the issuance of the Securities. If at any time the SEC shall issue any stop order suspending the effectiveness of the
Registration Statement or prohibiting or suspending the use of the Prospectus or any Prospectus Supplement, the Company shall use best
efforts to obtain the withdrawal of such order at the earliest possible time.


 




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(e)
Blue Sky. 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.


 


(f)
Reporting Status. Until the date on which the Buyers shall have sold all of the 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.


 


(g)
Use of Proceeds. The Company will use the proceeds from the sale of the Securities as described in the Prospectus Supplement,
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.


 


(h)
[Reserved.]


 


(i)
Listing. The Company shall promptly secure the listing or designation for quotation (as the case may be) of all of the Underlying
Securities (as defined below) upon each national securities exchange and automated quotation system, if any, upon which the Common 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 Underlying 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 Common 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 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 Common Shares on
an Eligible Market, unless such action will simultaneously maintain the listing of the Common Shares on another Eligible Market. The
Company shall pay all fees and expenses in connection with satisfying its obligations under this Section 4(i). “Underlying Securities”
means (i) the Securities, and (ii) any share capital of the Company issued or issuable with respect to the Securities, including, without
limitation, (1) as a result of any share split, share dividend, recapitalization, exchange or similar event or otherwise and (2) shares
of share capital of the Company (or any successor) into which the Common Shares are converted or exchanged.


 




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(j)
Fees. The Company shall reimburse the Buyers a non-accountable fee of $43,000 for all 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, $40,000 of legal fees and disbursements of Kelley Drye & Warren, LLP, counsel
to the lead Buyer, and $3,000 of legal fees and disbursements of Ellenoff Grossman & Schole LLP and 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; provided, that the Company shall promptly reimburse Kelley Drye
& Warren, LLP and Ellenoff Grossman & Schole LLP on demand for all Transaction Expenses not so reimbursed through such withholding
at the Closing. In addition to the Transaction Expenses, the Company shall be responsible for the payment of any placement agent’s
fees, financial advisory fees, transfer agent fees, DTC 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.


 


(k)
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 bona fide pledge of Securities by an Investor 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. 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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(l)
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 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) (including all attachments, the “6-K Filing”).
From and after the filing of the Press Release, 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 Press Release,
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(q) 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.


 




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(m)
Additional Issuance of Securities. The Company agrees that for the period commencing on the date hereof and ending on the date
immediately following the 90th calendar day after the Closing Date (the “Restricted Period”), neither the
Company nor any of its Subsidiaries shall directly or indirectly:


 


(i)
file a registration statement under the 1933 Act relating to securities that are not the Underlying Securities (other than a registration
statement on Form S-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));


 


(ii)
amend or modify (whether by an amendment, waiver, exchange of securities, or otherwise) any of the Company’s warrants to purchase
Common Shares that are outstanding as of the date hereof; or


 


(iii)
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(l)(iii) shall not apply in respect of the issuance of (A) Common Shares or standard options
to purchase Common Shares to directors, officers or employees of the Company in their capacity as such pursuant to an Approved Shares
Plan (as defined below), provided that (x) all such issuances (taking into account the Common Shares issuable upon exercise of such options)
after the date hereof pursuant to this clause (A) do not, in the aggregate, exceed more than 10% of the Common Shares issued and outstanding
immediately prior to the date hereof and (y) 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; (B) Common Shares issued upon the conversion or exercise of Convertible
Securities (other than standard options to purchase Common Shares issued pursuant to an Approved Shares Plan that are covered by clause
(A) 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 Common Shares issued pursuant to an Approved
Shares Plan that are covered by clause (A) above) is not lowered, none of such Convertible Securities (other than standard options to
purchase Common Shares issued pursuant to an Approved Shares Plan that are covered by clause (A) 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 Common Shares issued pursuant to an Approved Shares Plan that are covered by clause (A) above) are otherwise materially changed
in any manner that adversely affects any of the Buyers; and (C) the Securities. (Each of the foregoing in clauses (A) through (C), collectively
the “Excluded Securities”). “Approved Shares 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 Common Shares and standard
options to purchase Common 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, Common Shares)
or any of its Subsidiaries.


 




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(n)
[Reserved.]


 


(o)
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.


 


(p)
Variable Securities. Until the first anniversary of the date hereof, 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 Common 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 Common 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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(q)
Participation Right. Until the twelve month anniversary of the date hereof, 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(q). The Company
acknowledges and agrees that the right set forth in this Section 4(q) 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 35% 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(q) shall be (x) based on such Buyer’s pro rata portion of the aggregate number of Securities
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 Current Report on Form 8-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(q)(iii) above), then each Buyer may, at its sole option and in its sole discretion, 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(q)(ii) above multiplied by a fraction, (A) 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(q) prior to such reduction) and (B) 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(q)(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(q)(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(q) 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, 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.


 


(viii)
Notwithstanding anything to the contrary in this Section 4(q) 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(q). 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(q)(ii).


 


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


 


(r)
[Reserved.]


 




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(s)
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.


 


(t)
[Reserved.]


 


(u)
[Reserved.]


 


(v)
[Reserved.]


 


(w)
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.


 


(x)
No Waiver of Lock-Up Agreements. The Company shall not amend, waive or modify any provision of any of the Lock-Up Agreements.
The Company shall take all reasonably necessary actions to enforce the terms and conditions of the Lock-Up Agreements.


 


(y)
Closing Documents. On or prior to fourteen (14) calendar days after the Closing Date, the Company agrees to deliver, or cause
to be delivered, to each Buyer and Kelley Drye & Warren, LLP, and the Placement Agent 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 Securities in which the Company shall record the name and address
of the Person in whose name the Securities have been issued (including the name and address of each transferee) and the number of Securities
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 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 DTC, registered in the name of each Buyer or its respective nominee(s), for the
Securities. The Company represents and warrants that no instruction other than the Irrevocable Transfer Agent Instructions referred to
in this Section 5(b) 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, 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. 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 each legal opinion
referred to in the Irrevocable Transfer Agent Instructions to the Transfer Agent as follows: (i) at the Closing with respect to the Securities
and (ii) on each date a registration statement with respect to the issuance or resale of any of the Securities is declared effective
by the SEC. Any fees (with respect to the Transfer Agent, counsel to the Company or otherwise) associated with the issuance of such opinions
or the removal of any legends on any of the Securities shall be borne by the Company.


 




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(c)
Legends. Certificates and any other instruments evidencing the Securities shall not bear any restrictive or other legend.


 


(d)
[Reserved.]


 


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


 


The
obligation of the Company hereunder to issue and sell the Securities 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:


 


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


 


(b)
Such Buyer and each other Buyer shall have delivered to the Company the Purchase Price for the Securities being purchased by such Buyer
at the Closing by wire transfer of immediately available funds in accordance with the Flow of Funds Letter.


 


(c)
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.


 


The
obligation of each Buyer hereunder to purchase its Securities 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:


 


(a)
The Company shall have duly executed and delivered to such Buyer each of the Transaction Documents and the Company shall have duly executed
and delivered to such Buyer such aggregate number of Securities set forth across from such Buyer’s name in column (3) of the Schedule
of Buyers, as being purchased by such Buyer at the Closing pursuant to this Agreement.


 




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(b)
Such Buyer shall have received the opinions of the Company’s U.S. counsel and the Company’s British Virgin Islands counsel,
dated as of the Closing Date, in the form acceptable to such Buyer.


 


(c)
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.


 


(d)
The Company shall have delivered to such Buyer a certificate evidencing the formation and good standing of the Company and each of its
Subsidiaries in each such entity’s jurisdiction of formation issued by the Secretary of State (or comparable office) of such jurisdiction
of formation as of a date within ten (10) days of the Closing Date.


 


(e)
The Company shall have delivered to such Buyer a certificate evidencing the Company’s qualification as a foreign corporation and
good standing issued by the Secretary of State (or comparable office) of each jurisdiction in which the Company conducts business and
is required to so qualify, as of a date within ten (10) days of the Closing Date.


 


(f)
The Company 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.


 


(g)
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.


 


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


 


(i)
The Common 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.


 




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(j)
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.


 


(k)
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.


 


(l)
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.


 


(m)
The Company shall have obtained approval of the Principal Market to list or designate for quotation (as the case may be) the Securities.


 


(n)
The Company shall have duly executed and delivered to such Buyer lock-up agreements, in a form acceptable to the holder (the “Lock-Up
Agreement”), by and between the Company and any director and/or officer, as applicable, of the Company that beneficially owns
at least 2% of the Common Shares outstanding as of the date hereof (collectively, the “Stockholders”), and each of
the Stockholders shall have duly executed and delivered to such Buyer such Lock-Up Agreements.


 


(o)
Such Buyer shall have received a letter on the letterhead of the Company, 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 (the “Flow of Funds Letter”).


 


(p)
From the date hereof to the Closing Date, (i) trading in the Common Shares shall not have been suspended by the SEC or the Principal
Market (except for any suspension of trading of limited duration agreed to by the Company, which suspension shall be terminated prior
to the Closing), and, (ii) at any time prior to the Closing Date, trading in securities generally as reported by Bloomberg L.P. shall
not have been suspended or limited, or minimum prices shall not have been established on securities whose trades are reported by such
service, or on the Principal Market, nor shall a banking moratorium have been declared either by the United States or New York State
authorities nor shall there have occurred any material outbreak or escalation of hostilities or other national or international calamity
of such magnitude in its effect on, or any material adverse change in, any financial market which, in each case, in the reasonable judgment
of each Buyer, makes it impracticable or inadvisable to purchase the Securities at the Closing


 


(q)
The Registration Statement shall be effective and available for the issuance and sale of the Securities hereunder and the Company shall
have delivered to such Buyer the Prospectus and the Prospectus Supplement as required thereunder.


 


(r)
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.


 




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8.
TERMINATION.


 


In
the event that the Closing shall not have occurred with respect to a Buyer within ten (10) 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 Securities
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(j) 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.


 


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 CT Corporation,
as its agent for service of process in New York. If service of process is effected pursuant to the above sentence, such service will
be deemed sufficient under New York law and the Company shall not assert otherwise. 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 Company
or any of their respective properties, assets or revenues does not have any right of immunity under British Virgin Islands 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, 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 Common 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 Securities. 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, Buyers who have are entitled to purchase all of the Securities
at the Closing and (II) on or after the Closing Date, Buyers who purchased, in the aggregate, at least a majority of the Securities issued
or issuable hereunder.


 




    	38



     


    

 


(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:


 


No.
16, N. Dongke Rd.


Tongsha
Industrial Zone


Dongguan,
Guangdong 523000


People’s
Republic of China


Telephone:
+86-769-88753300


Attention:
Yunhao Chen, Chief Financial Officer


E-Mail:
yunhaochen@dogness.com


 


With
a copy (for informational purposes only) to:


 


Kaufman
& Canoles, P.C.


Two
James Center, 14th Floor


Richmond,
Virginia 23219


Telephone:
+1-804-771-5700


Attention:
Anthony W. Basch, Esq.


E-Mail:
awbasch@kaufcan.com


 


If
to the Transfer Agent:


 


Transhare
Corporation


2849
Executive Drive, Suite 200


Clearwater,
Florida 33762


Telephone:
+1-303-662-1112


Attention:
Kimberly Whiteside, Director of Operations


E-Mail:
kwhiteside@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


3
World Trade Center


175
Greenwich Street


New
York, NY 10007


Telephone:
+1-212-808-7540


Facsimile:
+1-212-808-7897


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.


 




    	39



     


    

 


(g)
Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors
and assigns (but excluding any purchasers of Securities, unless pursuant to a written assignment by such Buyer). The Company shall not
assign this Agreement or any rights or obligations hereunder without the prior written consent of the Required Holders. 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.


 


(i)
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(l), 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.


 




    	40



     


    

 


(ii)
Promptly after receipt by an Indemnitee under this Section 9(k) of notice of the commencement of any action or proceeding (including
any governmental action or proceeding) involving an Indemnified Liability, such Indemnitee shall, if a claim in respect thereof is to
be made against the Company under this Section 9(k), deliver to the Company a written notice of the commencement thereof, and the Company
shall have the right to participate in, and, to the extent the Company so desires, to assume control of the defense thereof with counsel
mutually satisfactory to the Company and the Indemnitee; provided, however, that an Indemnitee shall have the right to retain its own
counsel with the fees and expenses of such counsel to be paid by the Company if: (A) the Company has agreed in writing to pay such fees
and expenses; (B) the Company shall have failed promptly to assume the defense of such Indemnified Liability and to employ counsel reasonably
satisfactory to such Indemnitee in any such Indemnified Liability; or (C) the named parties to any such Indemnified Liability (including
any impleaded parties) include both such Indemnitee and the Company, and such Indemnitee shall have been advised by counsel that a conflict
of interest is likely to exist if the same counsel were to represent such Indemnitee and the Company (in which case, if such Indemnitee
notifies the Company in writing that it elects to employ separate counsel at the expense of the Company, then the Company shall not have
the right to assume the defense thereof and such counsel shall be at the expense of the Company), provided further, that in the case
of clause (C) above the Company shall not be responsible for the reasonable fees and expenses of more than one (1) separate legal counsel
for the Indemnitees. The Indemnitee shall reasonably cooperate with the Company in connection with any negotiation or defense of any
such action or Indemnified Liability by the Company and shall furnish to the Company all information reasonably available to the Indemnitee
which relates to such action or Indemnified Liability. The Company shall keep the Indemnitee reasonably apprised at all times as to the
status of the defense or any settlement negotiations with respect thereto. The Company shall not be liable for any settlement of any
action, claim or proceeding effected without its prior written consent, provided, however, that the Company shall not unreasonably withhold,
delay or condition its consent. The Company shall not, without the prior written consent of the Indemnitee, consent to entry of any judgment
or enter into any settlement or other compromise which does not include as an unconditional term thereof the giving by the claimant or
plaintiff to such Indemnitee of a release from all liability in respect to such Indemnified Liability or litigation, and such settlement
shall not include any admission as to fault on the part of the Indemnitee. Following indemnification as provided for hereunder, the Company
shall be subrogated to all rights of the Indemnitee with respect to all third parties, firms or corporations relating to the matter for
which indemnification has been made. The failure to deliver written notice to the Company within a reasonable time of the commencement
of any such action shall not relieve the Company of any liability to the Indemnitee under this Section 9(k), except to the extent that
the Company is materially and adversely prejudiced in its ability to defend such action.


 




    	41



     


    

 


(iii)
The indemnification required by this Section 9(k) shall be made by periodic payments of the amount thereof during the course of the investigation
or defense, within ten (10) days after bills are received or Indemnified Liabilities are incurred.


 


(iv)
The indemnity agreement contained herein shall be in addition to (A) any cause of action or similar right of the Indemnitee against the
Company or others, and (B) any liabilities the Company may be subject to pursuant to the law.


 


(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, Common Shares and
any other numbers in this Agreement that relate to the Common Shares shall be automatically adjusted for any share splits, share dividends,
share combinations, recapitalizations or other similar transactions that occur with respect to the Common 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).


 




    	42



     


    

 


(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)(1) being hereinafter referred to as the “Judgment Conversion
Date”).


 




    	43



     


    

 


(ii)
If in the case of any proceeding in the court of any jurisdiction referred to in Section 9(p)(i)(1) 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]


 




    	44



     


    

 


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:
	 	 
	 	DOGNESS
    (INTERNATIONAL) CORPORATION
	 	 	 
	 	By:	                             
	 	Name:	 
	 	Title:	 


 




    	 



     


    

 


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:
	 	 	 
	 	By:	                
	 	Name:	 
	 	Title: