Document:

2006 Share Incentive Plan

 Exhibit 10.3 
 TONGJITANG CHINESE MEDICINES COMPANY 
 2006 SHARE INCENTIVE PLAN 
 ARTICLE 1 
 PURPOSE 

The purpose of Tongjitang Chinese Medicines Company 2006 Share Incentive Plan (the “Plan”) is to promote the success and enhance the
value of Tongjitang Chinese Medicines Company, an exempted company formed under the laws of the Cayman Islands (the “Company”) by linking the personal interests of the members of the Board, Employees, and Consultants to those of
Company shareholders and by providing such individuals with an incentive for outstanding performance to generate superior returns to Company shareholders. The Plan is further intended to provide flexibility to the Company in its ability to motivate,
attract, and retain the services of members of the Board, Employees, and Consultants upon whose judgment, interest, and special effort the successful conduct of the Company’s operation is largely dependent. 
 ARTICLE 2 
 DEFINITIONS AND
CONSTRUCTION 
 Wherever the following terms are used in the Plan they shall have the meanings specified below, unless the context
clearly indicates otherwise. The singular pronoun shall include the plural where the context so indicates. 
 2.1 “Applicable
Laws” means the legal requirements relating to the Plan and the Awards under applicable provisions of the corporate and securities laws of the Cayman Islands, the Code, the PRC tax laws, rules, regulations and government orders, the rules
of any applicable Share exchange or national market system, and the laws and the rules of any jurisdiction applicable to Awards granted to residents therein. 
 2.2 “Award” means an Option, a Restricted Share award, a Share Appreciation Right award, a Dividend Equivalents award, a Share Payment award, a Deferred Share award, or a Restricted Share Unit award
granted to a Participant pursuant to the Plan. 
 2.3 “Award Agreement” means any written agreement, contract, or other
instrument or document evidencing an Award, including through electronic medium. 
 2.4 “Board” means the Board of Directors
of the Company. 
 2.5 “Board Adoption Date” shall have the meaning set forth in Section 12.1. 

 2.6 “Change in Control” means a change in ownership or control of the Company after the
Registration Date effected through either of the following transactions: 
 (a) the direct or indirect acquisition by any person or related
group of persons (other than an acquisition from or by the Company or by a Company-sponsored employee benefit plan or by a person that directly or indirectly controls, is controlled by, or is under common control with, the Company) of beneficial
ownership (within the meaning of Rule 13d-3 of the Exchange Act) of securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s outstanding securities pursuant to a tender or exchange offer
made directly to the Company’s shareholders which a majority of the Incumbent Board (as defined below) who are not affiliates or associates of the offeror under Rule 12b-2 promulgated under the Exchange Act do not recommend such
shareholders accept, or 
 (b) the individuals who, as of the Effective Date, are members of the Board (the “Incumbent Board”),
cease for any reason to constitute at least fifty percent (50%) of the Board; provided that if the election, or nomination for election by the Company’s shareholders, of any new member of the Board is approved by a vote of at least fifty
percent (50%) of the Incumbent Board, such new member of the Board shall be considered as a member of the Incumbent Board. 
 2.7
“Code” means the Internal Revenue Code of 1986 of the United States, as amended. 
 2.8 “Committee” means
the committee of the Board described in Article 11. 
 2.9 “Consultant” means any consultant or adviser if: (a) the
consultant or adviser renders bona fide services to a Service Recipient; (b) the services rendered by the consultant or adviser are not in connection with the offer or sale of securities in a capital-raising transaction and do not directly or
indirectly promote or maintain a market for the Company’s securities; and (c) the consultant or adviser is a natural person who has contracted directly with the Service Recipient to render such services. 
 2.10 “Corporate Transaction” means any of the following transactions, provided, however, that the Committee shall determine under
(d) and (e) whether multiple transactions are related, and its determination shall be final, binding and conclusive: 
 (a) an
amalgamation, arrangement or consolidation in which the Company is not the surviving entity, except for a transaction the principal purpose of which is to change the jurisdiction in which the Company is incorporated; 
 (b) the sale, transfer or other disposition of all or substantially all of the assets of the Company; 
 (c) the complete liquidation or dissolution of the Company; 
 (d) any reverse takeover or series of related transactions culminating in a reverse takeover (including, but not limited to, a tender offer followed by a reverse takeover) in which the Company is the surviving entity
but (A) the Ordinary Shares outstanding immediately prior to such takeover are converted or exchanged by virtue of the takeover into other property, whether in the form of securities, cash or otherwise, or (B) in which securities
possessing more than fifty percent (50%) of the total combined voting power of the Company’s outstanding 

  

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securities are transferred to a person or persons different from those who held such securities immediately prior to such takeover or the initial transaction
culminating in such takeover, but excluding any such transaction or series of related transactions that the Committee determines shall not be a Corporate Transaction; or 
 (e) acquisition in a single or series of related transactions by any person or related group of persons (other than the Company or by a Company-sponsored employee benefit plan) of beneficial ownership (within the
meaning of Rule 13d-3 of the Exchange Act) of securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s outstanding securities but excluding any such transaction or series of related
transactions that the Committee determines shall not be a Corporate Transaction. 
 2.11 “Deferred Share” means a right to
receive a specified number of Shares during specified time periods pursuant to Article 8. 
 2.12 “Disability” means that
the Participant qualifies to receive long-term disability payments under the Service Recipient’s long-term disability insurance program, as it may be amended from time to time, to which the Participant provides services regardless of whether
the Participant is covered by such policy. If the Service Recipient to which the Participant provides service does not have a long-term disability plan in place, “Disability” means that a Participant is unable to carry out the
responsibilities and functions of the position held by the Participant by reason of any medically determinable physical or mental impairment for a period of not less than ninety (90) consecutive days. A Participant will not be considered to
have incurred a Disability unless he or she furnishes proof of such impairment sufficient to satisfy the Committee in its discretion. 
 2.13
“Dividend Equivalents” means a right granted to a Participant pursuant to Article 8 to receive the equivalent value (in cash or Share) of dividends paid on Share. 
 2.14 “Effective Date” shall have the meaning set forth in Section 12.1. 
 2.15 “Employee” means any person, including an officer or member of the Board of the Company, any Parent or Subsidiary of the Company,
who is in the employ of a Service Recipient, subject to the control and direction of the Service Recipient as to both the work to be performed and the manner and method of performance. The payment of a director’s fee by a Service Recipient
shall not be sufficient to constitute “employment” by the Service Recipient. 
 2.16 “Exchange Act” means the
Securities Exchange Act of 1934 of the United States, as amended. 
 2.17 “Fair Market Value” means, as of any date, the
value of Shares determined as follows: 
 (a) If the Shares are listed on one or more established Share exchanges or national market systems,
including without limitation, the NASDAQ Global Select Market, the NASDAQ Global Market or the NASDAQ National Market, its Fair Market Value shall be the closing sales price for such shares (or the closing bid, if no sales were reported) as quoted
on the principal exchange or system on which the Shares are listed (as determined by the Committee) 

  

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on the date of determination (or, if no closing sales price or closing bid was reported on that date, as applicable, on the last trading date such closing
sales price or closing bid was reported), as reported in The Wall Street Journal or such other source as the Committee deems reliable; 
 (b)
If the Shares are regularly quoted on an automated quotation system (including the OTC Bulletin Board) or by a recognized securities dealer, its Fair Market Value shall be the closing sales price for such shares as quoted on such system or by such
securities dealer on the date of determination, but if selling prices are not reported, the Fair Market Value of an Ordinary Share shall be the mean between the high bid and low asked prices for the Ordinary Shares on the date of determination (or,
if no such prices were reported on that date, on the last date such prices were reported), as reported in The Wall Street Journal or such other source as the Committee deems reliable; or 
 (c) In the absence of an established market for the Shares of the type described in (i) and (ii), above, the Fair Market Value thereof shall be
determined by the Committee in good faith by reference to the placing price of the latest private placement of the Shares and the development of the Company’s business operations and the general economic and market conditions since such latest
private placement. 
 2.18 “Incentive Share Option” means an Option that is intended to meet the requirements of
Section 422 of the Code or any successor provision thereto. 
 2.19 “Independent Director” means a member of the Board
who is not an Employee of the Company. 
 2.20 “Non-Employee Director” means a member of the Board who qualifies as a
“Non-Employee Director” as defined in Rule 16b-3(b)(3) of the Exchange Act, or any successor definition adopted by the Board. 
 2.21 “Non-Qualified Share Option” means an Option that is not intended to be an Incentive Share Option. 
 2.22
“Option” means a right granted to a Participant pursuant to Article 5 of the Plan to purchase a specified number of Shares at a specified price during specified time periods. An Option may be either an Incentive Share Option or a
Non-Qualified Share Option. 
 2.23 “Participant” means a person who, as a member of the Board, Consultant or Employee, has
been granted an Award pursuant to the Plan. 
 2.24 “Parent” means a parent corporation under Section 424(e) of the
Code. 
 2.25 “Plan” means this Tongjitang Chinese Medicines Company 2006 Share Incentive Plan, as amended from time to
time. 
 2.26 “PRC” means the People’s Republic of China 
 2.27 “Related Entity” means any business, corporation, partnership, limited liability company or other entity which is not a Subsidiary
but is consolidated in the Company’s consolidated financial statements prepared under the United States generally accepted accounting principles. 
  

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 2.28 “Restricted Share” means a Share awarded to a Participant pursuant to Article 6
that is subject to certain restrictions and may be subject to risk of forfeiture. 
 2.29 “Restricted Share Unit” means an
Award granted pursuant to Section 8.6. 
 2.30 “Securities Act” means the Securities Act of 1933 of the United States,
as amended. 
 2.31 “Service Recipient” means the Company, any Parent or Subsidiary of the Company and any Related Entity to
which a Participant provides services as an Employee, Consultant or as a Director. 
 2.32 “Share” means the ordinary share
of the Company, par value $0.001 per share, and such other securities that may be substituted for Shares pursuant to Article 10. 
 2.33
“Share Appreciation Right” or “SAR” means a right granted pursuant to Article 7 to receive a payment equal to the excess of the Fair Market Value of a specified number of Shares on the date the SAR is exercised over
the Fair Market Value on the date the SAR was granted as set forth in the applicable Award Agreement. 
 2.34 “Share
Payment” means (a) a payment in the form of Shares, or (b) an option or other right to purchase Shares, as part of any bonus, deferred compensation or other arrangement, made in lieu of all or any portion of the compensation,
granted pursuant to Article 8. 
 2.35 “Subsidiary” means any corporation or other entity of which a majority of the
outstanding voting shares or voting power is beneficially owned directly or indirectly by the Company. 
 2.36 “Trading
Date” means the closing of the first sale to the general public of the Shares pursuant to a registration statement filed with and declared effective by the U.S. Securities and Exchange Commission under the Securities Act. 
 ARTICLE 3 
 SHARES SUBJECT TO THE
PLAN 
 3.1 Number of Shares. 
 (a) Subject to the provisions of Article 10 and Section 3.1(b), the maximum aggregate number of Shares which may be issued pursuant to all Awards (including Incentive Share Options) is 50,000,000 Shares. 
 (b) To the extent that an Award terminates, expires, or lapses for any reason, any Shares subject to the Award shall again be available for the grant of
an Award pursuant to 

  

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the Plan. To the extent permitted by Applicable Law or any exchange rule, Shares issued in assumption of, or in substitution for, any outstanding awards of
any entity acquired in any form or combination by the Company or any Parent or Subsidiary of the Company shall not be counted against Shares available for grant pursuant to the Plan. Shares delivered by the Participant or withheld by the Company
upon the exercise of any Award under the Plan, in payment of the exercise price thereof or tax withholding thereon, may again be optioned, granted or awarded hereunder, subject to the limitations of Section 3.1(a), If any Restricted Shares are
forfeited by the Participant or repurchased by the Company, such Shares may again be optioned, granted or awarded hereunder, subject to the limitations of Section 3.1(a). Notwithstanding the provisions of this Section 3.1(b), no Shares may
again be optioned, granted or awarded if such action would cause an Incentive Share Option to fail to qualify as an incentive Share option under Section 422 of the Code. 
 3.2 Shares Distributed. Any Shares distributed pursuant to an Award may consist, in whole or in part, of authorized and unissued Shares, treasury
or Shares purchased on the open market. Additionally, in the discretion of the Committee, American Depository Shares in an amount equal to the number of Shares which otherwise would be distributed pursuant to an Award may be distributed in lieu of
Shares in settlement of any Award. If the number of Shares represented by an American Depository Share is other than on a one-to-one basis, the limitations of Section 3.1 shall be adjusted to reflect the distribution of American Depository Shares in
lieu of Shares. 
 ARTICLE 4 
 ELIGIBILITY AND PARTICIPATION 
 4.1 Eligibility. Persons eligible to participate in this Plan include Employees,
Consultants, and all members of the Board, as determined by the Committee. 
 4.2 Participation. Subject to the provisions of the
Plan, the Committee may, from time to time, select from among all eligible individuals, those to whom Awards shall be granted and shall determine the nature and amount of each Award. No individual shall have any right to be granted an Award pursuant
to this Plan. 
 4.3 Jurisdictions. In order to assure the viability of Awards granted to Participants employed in various
jurisdictions, the Committee may provide for such special terms as it may consider necessary or appropriate to accommodate differences in local law, tax policy, or custom applicable in the jurisdiction in which the Participant resides or is
employed. Moreover, the Committee may approve such supplements to, or amendments, restatements, or alternative versions of, the Plan as it may consider necessary or appropriate for such purposes without thereby affecting the terms of the Plan as in
effect for any other purpose; provided, however, that no such supplements, amendments, restatements, or alternative versions shall increase the share limitations contained in Section 3.1 of the Plan. Notwithstanding the foregoing, the
Committee may not take any actions hereunder, and no Awards shall be granted, that would violate any Applicable Laws. 
  

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 ARTICLE 5 
 OPTIONS 
 5.1 General. The Committee is authorized to grant Options to Participants on the
following terms and conditions: 
 (a) Exercise Price. The exercise price per Share subject to an Option shall be determined by the
Committee and set forth in the Award Agreement which may be a fixed or variable price related to the Fair Market Value of the Shares. 
 (b)
Time and Conditions of Exercise. The Committee shall determine the time or times at which an Option may be exercised in whole or in part, including exercise prior to vesting; provided that the term of any Option granted under the Plan
shall not exceed ten years, except as provided in Section 11.2. The Committee shall also determine any conditions, if any, that must be satisfied before all or part of an Option may be exercised. 
 (c) Payment. The Committee shall determine the methods by which the exercise price of an Option may be paid, the form of payment, including,
without limitation (i) cash or check denominated in U.S. Dollars, (ii) Shares held for such period of time as may be required by the Committee in order to avoid adverse financial accounting consequences and having a Fair Market Value on
the date of delivery equal to the aggregate exercise price of the Option or exercised portion thereof, (iii) after the Trading Date the delivery of a notice that the Participant has placed a market sell order with a broker with respect to
Shares then issuable upon exercise of the Option, and that the broker has been directed to pay a sufficient portion of the net proceeds of the sale to the Company in satisfaction of the Option exercise price; provided that payment of such
proceeds is then made to the Company upon settlement of such sale), and the methods by which Shares shall be delivered or deemed to be delivered to Participants, (iv) other property acceptable to the Committee with a Fair Market Value equal to
the exercise price, or (v) any combination of the foregoing. Notwithstanding any other provision of the Plan to the contrary, no Participant who is a member of the Board or an “executive officer” of the Company within the meaning of
Section 13(k) of the Exchange Act shall be permitted to pay the exercise price of an Option in any method which would violate Section 13(k) of the Exchange Act. 
 (d) Evidence of Grant. All Options shall be evidenced by an Award Agreement between the Company and the Participant. The Award Agreement shall include such additional provisions as may be specified by the
Committee. 
 5.2 Incentive Share Options. Incentive Share Options shall be granted only to Employees of the Company, a Parent or
Subsidiary of the Company. Incentive Share Options may not be granted to Employees of a Related Entity. The terms of any Incentive Share Options granted pursuant to the Plan, in addition to the requirements of Section 5.1, must comply with the
following additional provisions of this Section 5.2: 
 (a) Expiration of Option. An Incentive Share Option may not be exercised to any
extent by anyone after the first to occur of the following events: 
 (i) Ten years from the date it is granted, unless an earlier time is
set in the Award Agreement; 
  

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 (ii) One month after the Participant’s termination of employment as an Employee; and 
 (iii) One year after the date of the Participant’s termination of employment or service on account of Disability or death. Upon the
Participant’s Disability or death, any Incentive Share Options exercisable at the Participant’s Disability or death may be exercised by the Participant’s legal representative or representatives, by the person or persons entitled to do
so pursuant to the Participant’s last will and testament, or, if the Participant fails to make testamentary disposition of such Incentive Share Option or dies intestate, by the person or persons entitled to receive the Incentive Share Option
pursuant to the applicable laws of descent and distribution. 
 (b) Individual Dollar Limitation. The aggregate Fair Market Value
(determined as of the time the Option is granted) of all Shares with respect to which Incentive Share Options are first exercisable by a Participant in any calendar year may not exceed $100,000 or such other limitation as imposed by
Section 422(d) of the Code, or any successor provision. To the extent that Incentive Share Options are first exercisable by a Participant in excess of such limitation, the excess shall be considered Non-Qualified Share Options. 
 (c) Ten Percent Owners. An Incentive Share Option shall be granted to any individual who, at the date of grant, owns Shares possessing more than
ten percent of the total combined voting power of all classes of shares of the Company only if such Option is granted at a price that is not less than 110% of Fair Market Value on the date of grant and the Option is exercisable for no more than five
years from the date of grant. 
 (d) Transfer Restriction. The Participant shall give the Company prompt notice of any disposition of
Shares acquired by exercise of an Incentive Share Option within (i) two years from the date of grant of such Incentive Share Option or (ii) one year after the transfer of such Shares to the Participant. 
 (e) Expiration of Incentive Share Options. No Award of an Incentive Share Option may be made pursuant to this Plan after the tenth anniversary of
the Effective Date. 
 (f) Right to Exercise. During a Participant’s lifetime, an Incentive Share Option may be exercised only by
the Participant. 
 5.3 Substitution of Share Appreciation Rights. The Committee may provide in the Award Agreement evidencing the
grant of an Option that the Committee, in its sole discretion, shall have to right to substitute a Share Appreciation Right for such Option at any time prior to or upon exercise of such Option, provided that such Share Appreciation Right shall be
exercisable for the same number of shares of Share as such substituted Option would have been exercisable for. 
  

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 ARTICLE 6 
 RESTRICTED SHARES 
 6.1 Grant of Restricted Shares. The Committee is authorized to make Awards
of Restricted Shares to any Participant selected by the Committee in such amounts and subject to such terms and conditions as determined by the Committee. All Awards of Restricted Shares shall be evidenced by an Award Agreement. 
 6.2 Issuance and Restrictions. Restricted Shares shall be subject to such restrictions on transferability and other restrictions as the Committee
may impose (including, without limitation, limitations on the right to vote Restricted Shares or the right to receive dividends on the Restricted Share). These restrictions may lapse separately or in combination at such times, pursuant to such
circumstances, in such installments, or otherwise, as the Committee determines at the time of the grant of the Award or thereafter. 
 6.3
Forfeiture. Except as otherwise determined by the Committee at the time of the grant of the Award or thereafter, upon termination of employment or service during the applicable restriction period, Restricted Shares that are at that time
subject to restrictions shall be forfeited; provided, however, that the Committee may (a) provide in any Restricted Share Award Agreement that restrictions or forfeiture conditions relating to Restricted Shares will be waived in whole or in
part in the event of terminations resulting from specified causes, and (b) in other cases waive in whole or in part restrictions or forfeiture conditions relating to Restricted Shares. 
 6.4 Certificates for Restricted Shares. Restricted Shares granted pursuant to the Plan may be evidenced in such manner as the Committee shall
determine. If certificates representing Restricted Shares are registered in the name of the Participant, certificates must bear an appropriate legend referring to the terms, conditions, and restrictions applicable to such Restricted Shares, and the
Company may, at its discretion, retain physical possession of the certificate until such time as all applicable restrictions lapse. 
 ARTICLE 7 
 SHARE APPRECIATION RIGHTS 
 7.1 Grant of Share Appreciation Rights. 
 (a) A Share Appreciation Right may be granted to any
Participant selected by the Committee. A Share Appreciation Right shall be subject to such terms and conditions not inconsistent with the Plan as the Committee shall impose and shall be evidenced by an Award Agreement. 
 (b) A Share Appreciation Right shall entitle the Participant (or other person entitled to exercise the Share Appreciation Right pursuant to the Plan) to
exercise all or a specified portion of the Share Appreciation Right (to the extent then exercisable pursuant to its terms) and to receive from the Company an amount determined by multiplying the difference obtained by subtracting the exercise price
per share of the Share Appreciation Right from the Fair Market Value of a Share on the date of exercise of the Share Appreciation Right by the number of Shares with respect to which the Share Appreciation Right shall have been exercised, subject to
any limitations the Committee may impose. 
  

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 7.2 Payment and Limitations on Exercise. 
 (a) Payment of the amounts determined under Section 7.1(b) above shall be in cash, in Shares (based on its Fair Market Value as of the date the Share
Appreciation Right is exercised) or a combination of both, as determined by the Committee in the Award Agreement. 
 (b) To the extent
payment for a Share Appreciation Right is to be made in cash the Award Agreements shall to the extent necessary to comply with the requirements to Section 409A of the Code, specify the date of payment which may be different than the date of
exercise of the Share Appreciation right. If the date of payment for a Share Appreciation Right is later than the date of exercise, the Award Agreement may specify that the Participant be entitled to earnings on such amount until paid. 

(c) To the extent any payment under Section 7.1(b) is effected in Shares it shall be made subject to satisfaction of all provisions of Article 5
above pertaining to Options. 
 ARTICLE 8 
 OTHER TYPES OF AWARDS 
 8.1 Dividend Equivalents. Any Participant selected by the Committee
may be granted Dividend Equivalents based on the dividends declared on the Shares that are subject to any Award, to be credited as of dividend payment dates, during the period between the date the Award is granted and the date the Award is
exercised, vests or expires, as determined by the Committee. Such Dividend Equivalents shall be converted to cash or additional Shares by such formula and at such time and subject to such limitations as may be determined by the Committee.

 8.2 Share Payments. Any Participant selected by the Committee may receive Share Payments in the manner determined from time to time
by the Committee; provided, that unless otherwise determined by the Committee such Share Payments shall be made in lieu of base salary, bonus, or other cash compensation otherwise payable to such Participant. The number of shares shall be
determined by the Committee and may be based upon the Performance Criteria or other specific criteria determined appropriate by the Committee, determined on the date such Share Payment is made or on any date thereafter. 
 8.3 Deferred Shares. Any Participant selected by the Committee may be granted an award of Deferred Shares in the manner determined from time to
time by the Committee. The number of shares of Deferred Shares shall be determined by the Committee and may be linked to such specific criteria determined to be appropriate by the Committee, in each case on a specified date or dates or over any
period or periods determined by the Committee. Shares underlying a Deferred Share award will not be issued until the Deferred Share award has vested, pursuant to a vesting schedule or criteria set by the Committee. Unless otherwise provided by the
Committee, a Participant awarded Deferred Shares shall have no rights as a Company shareholder with respect to such Deferred Shares until such time as the Deferred Share Award has vested and the Shares underlying the Deferred Share Award has been
issued. 
  

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 8.4 Restricted Share Units. The Committee is authorized to make Awards of Restricted Share Units
to any Participant selected by the Committee in such amounts and subject to such terms and conditions as determined by the Committee. At the time of grant, the Committee shall specify the date or dates on which the Restricted Share Units shall
become fully vested and nonforfeitable, and may specify such conditions to vesting as it deems appropriate. At the time of grant, the Committee shall specify the maturity date applicable to each grant of Restricted Share Units which shall be no
earlier than the vesting date or dates of the Award and may be determined at the election of the grantee. On the maturity date, the Company shall transfer to the Participant one unrestricted, fully transferable Share for each Restricted Share Unit
scheduled to be paid out on such date and not previously forfeited. The Committee shall specify the purchase price, if any, to be paid by the grantee to the Company for such Shares. 
 8.5 Term. Except as otherwise provided herein, the term of any Award of Dividend Equivalents, Share Payments, Deferred Share, or Restricted Share
Units shall be set by the Committee in its discretion. 
 8.6 Exercise or Purchase Price. The Committee may establish the exercise or
purchase price, if any, of any Award of Deferred Share, Share Payments or Restricted Share Units; provided, however, that such price shall not be less than the par value of a Share, unless otherwise permitted by Applicable Law. 
 8.7 Exercise Upon Termination of Employment or Service. An Award of Dividend Equivalents, Deferred Share, Share Payments, and Restricted Share
Units shall only be exercisable or payable while the Participant is an Employee, Consultant or a member of the Board, as applicable; provided, however, that the Committee in its sole and absolute discretion may provide that an Award of
Dividend Equivalents, Share Payments, Deferred Share, or Restricted Share Units may be exercised or paid subsequent to a termination of employment or service, as applicable, or following a Change of Control of the Company, or because of the
Participant’s retirement, death or Disability, or otherwise. 
 8.8 Form of Payment. Payments with respect to any Awards granted
under this Article 8 shall be made in cash, in Shares or a combination of both, as determined by the Committee. 
 8.9 Award
Agreement. All Awards under this Article 8 shall be subject to such additional terms and conditions as determined by the Committee and shall be evidenced by an Award Agreement. 
 ARTICLE 9 
 PROVISIONS APPLICABLE TO AWARDS 
 9.1 Stand-Alone and Tandem Awards. Awards granted pursuant to the Plan may, in the discretion of the Committee, be granted either alone, in
addition to, or in tandem with, any other Award granted pursuant to the Plan. Awards granted in addition to or in tandem with other Awards may be granted either at the same time as or at a different time from the grant of such other Awards.

 9.2 Award Agreement. Awards under the Plan shall be evidenced by Award 

  

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Agreements that set forth the terms, conditions and limitations for each Award which may include the term of an Award, the provisions applicable in the event
the Participant’s employment or service terminates, and the Company’s authority to unilaterally or bilaterally amend, modify, suspend, cancel or rescind an Award. 
 9.3 Limits on Transfer. No right or interest of a Participant in any Award may be pledged, encumbered, or hypothecated to or in favor of any party
other than the Company or a Subsidiary, or shall be subject to any lien, obligation, or liability of such Participant to any other party other than the Company or a Subsidiary. Except as otherwise provided by the Committee, no Award shall be
assigned, transferred, or otherwise disposed of by a Participant other than by will or the laws of descent and distribution. The Committee by express provision in the Award or an amendment thereto may permit an Award (other than an Incentive Share
Option) to be transferred to, exercised by and paid to certain persons or entities related to the Participant, including but not limited to members of the Participant’s family, charitable institutions, or trusts or other entities whose
beneficiaries or beneficial owners are members of the Participant’s family and/or charitable institutions, or to such other persons or entities as may be expressly approved by the Committee, pursuant to such conditions and procedures as the
Committee may establish. Any permitted transfer shall be subject to the condition that the Committee receive evidence satisfactory to it that the transfer is being made for estate and/or tax planning purposes (or to a “blind trust” in
connection with the Participant’s termination of employment or service with the Company or a Subsidiary to assume a position with a governmental, charitable, educational or similar non-profit institution) and on a basis consistent with the
Company’s lawful issue of securities. 
 9.4 Beneficiaries. Notwithstanding Section 10.3, a Participant may, in the manner
determined by the Committee, designate a beneficiary to exercise the rights of the Participant and to receive any distribution with respect to any Award upon the Participant’s death. A beneficiary, legal guardian, legal representative, or other
person claiming any rights pursuant to the Plan is subject to all terms and conditions of the Plan and any Award Agreement applicable to the Participant, except to the extent the Plan and Award Agreement otherwise provide, and to any additional
restrictions deemed necessary or appropriate by the Committee. If the Participant is married and resides in a community property state, a designation of a person other than the Participant’s spouse as his or her beneficiary with respect to more
than 50% of the Participant’s interest in the Award shall not be effective without the prior written consent of the Participant’s spouse. If no beneficiary has been designated or survives the Participant, payment shall be made to the
person entitled thereto pursuant to the Participant’s will or the laws of descent and distribution. Subject to the foregoing, a beneficiary designation may be changed or revoked by a Participant at any time provided the change or revocation is
filed with the Committee. 
 9.5 Share Certificates. Notwithstanding anything herein to the contrary, the Company shall not be
required to issue or deliver any certificates evidencing shares of Share pursuant to the exercise of any Award, unless and until the Board has determined, with advice of counsel, that the issuance and delivery of such certificates is in compliance
with all Applicable Laws, regulations of governmental authorities and, if applicable, the requirements of any exchange on which the Shares are listed or traded. All Share certificates delivered pursuant to the Plan are subject to any stop-transfer
orders and other restrictions as the Committee deems necessary or advisable to comply with federal, state, or foreign jurisdiction, securities or other laws, rules and 

  

 12 

 
regulations and the rules of any national securities exchange or automated quotation system on which the Shares are listed, quoted, or traded. The Committee
may place legends on any Share certificate to reference restrictions applicable to the Share. In addition to the terms and conditions provided herein, the Board may require that a Participant make such reasonable covenants, agreements, and
representations as the Board, in its discretion, deems advisable in order to comply with any such laws, regulations, or requirements. The Committee shall have the right to require any Participant to comply with any timing or other restrictions with
respect to the settlement or exercise of any Award, including a window-period limitation, as may be imposed in the discretion of the Committee. 
 9.6 Paperless Administration. Subject to Applicable Laws, the Committee may make Awards, provide applicable disclosure and procedures for exercise of Awards by an internet website or interactive voice response system for the
paperless administration of Awards. 
 9.7 Foreign Currency. A Participant may be required to provide evidence that any U.S. dollars
used to pay the exercise price of any Award were acquired and taken out of the jurisdiction in which the Participant resides in accordance with Applicable Laws, including foreign exchange control laws and regulations. 
 ARTICLE 10 
 CHANGES IN CAPITAL
STRUCTURE 
 10.1 Adjustments. In the event of any dividend, share split, combination or exchange of Shares, amalgamation,
arrangement or consolidation, spin-off, recapitalization or other distribution (other than normal cash dividends) of Company assets to its shareholders, or any other change affecting the shares of Shares or the share price of a Share, the Committee
shall make such proportionate adjustments, if any, as the Committee in its discretion may deem appropriate to reflect such change with respect to (a) the aggregate number and type of shares that may be issued under the Plan (including, but not
limited to, adjustments of the limitations in Section 3.1); (b) the terms and conditions of any outstanding Awards (including, without limitation, any applicable performance targets or criteria with respect thereto); and (c) the grant
or exercise price per share for any outstanding Awards under the Plan. 
 10.2 Acceleration upon a Change of Control. Except as may
otherwise be provided in any Award Agreement or any other written agreement entered into by and between the Company and a Participant, if a Change of Control occurs and a Participant’s Options, Restricted Share or Share Appreciation Rights
settled in Shares are not converted, assumed, or replaced by a successor, such Awards shall become fully exercisable and all forfeiture restrictions on such Awards shall lapse; and provided such Change of Control is a change in the ownership or
effective control of the Company or in the ownership of or a substantial portion of the assets of the Company within the meaning of Section 409A of the Code, then all Restricted Share Units, Deferred Share and Performance Share shall become
deliverable upon the Change of Control. Upon, or in anticipation of, a Change of Control, the Committee may in its sole discretion provide for (i) any and all Awards outstanding hereunder to terminate at a specific time in the future and shall
give each Participant the right to exercise such Awards during a period of time as the Committee shall determine, (ii) either the purchase of any Award for an amount of cash 

  

 13 

 
equal to the amount that could have been attained upon the exercise of such Award or realization of the Participant’s rights had such Award been
currently exercisable or payable or fully vested (and, for the avoidance of doubt, if as of such date the Committee determines in good faith that no amount would have been attained upon the exercise of such Award or realization of the
Participant’ s rights, then such Award may be terminated by the Company without payment), (iii) the replacement of such Award with other rights or property selected by the Committee in its sole discretion the assumption of or substitution
of such Award by the successor or surviving corporation, or a parent or subsidiary thereof, with appropriate adjustments as to the number and kind of Shares and prices, or (iv) provide for payment of Awards in cash based on the value of Shares
on the date of the Change of Control plus reasonable interest on the Award through the date such Award would otherwise be vested or have been paid in accordance with its original terms, if necessary to comply with Section 409A of the Code.

 10.3 Outstanding Awards – Corporate Transactions. In the event of a Corporate Transaction, each Award will terminate upon the
consummation of the Corporate Transaction, unless the Award is assumed by the successor entity or Parent thereof in connection with the Corporate Transaction. Except as provided otherwise in an individual Award Agreement, in the event of a
Corporate Transaction and: 
 (a) the Award either is (x) assumed by the successor entity or Parent thereof or replaced with a comparable
Award (as determined by the Committee) with respect to shares of the capital stock of the successor entity or Parent thereof or (y) replaced with a cash incentive program of the successor entity which preserves the compensation element of such
Award existing at the time of the Corporate Transaction and provides for subsequent payout in accordance with the same vesting schedule applicable to such Award, then such Award (if assumed), the replacement Award (if replaced), or the cash
incentive program automatically shall become fully vested, exercisable and payable and be released from any restrictions on transfer (other than transfer restrictions applicable to Options) and repurchase or forfeiture rights, immediately upon
termination of the Participant’s employment or service with all Service Recipient within twelve (12) months of the Corporate Transaction without cause; and 
 (b) For each Award that is neither assumed nor replaced, such portion of the Award shall automatically become fully vested and exercisable and be released from any repurchase or forfeiture rights (other than
repurchase rights exercisable at Fair Market Value) for all of the Shares at the time represented by such portion of the Award, immediately prior to the specified effective date of such Corporate Transaction, provided that the Participant remains an
Employee, Consultant or Director on the effective date of the Corporate Transaction. 
 10.4 Outstanding Awards – Other Changes.
In the event of any other change in the capitalization of the Company or corporate change other than those specifically referred to in this Article 10, the Committee may, in its absolute discretion, make such adjustments in the number and class of
shares subject to Awards outstanding on the date on which such change occurs and in the per share grant or exercise price of each Award as the Committee may consider appropriate to prevent dilution or enlargement of rights. 
 10.5 No Other Rights. Except as expressly provided in the Plan, no Participant shall have any rights by reason of any subdivision or consolidation
of Shares of any class, the payment 

  

 14 

 
of any dividend, any increase or decrease in the number of shares of any class or any dissolution, liquidation, merger, or consolidation of the Company or
any other corporation. Except as expressly provided in the Plan or pursuant to action of the Committee under the Plan, no issuance by the Company of shares of any class, or securities convertible into shares of any class, shall affect, and no
adjustment by reason thereof shall be made with respect to, the number of shares subject to an Award or the grant or exercise price of any Award. 
 ARTICLE 11 
 ADMINISTRATION 
 11.1 Committee. The Plan shall be administered by the Compensation Committee of the Board; provided, however that the Compensation Committee may delegate to a committee the authority to grant or amend
Awards to Participants other than Independent Directors and executive officers of the Company (such committee being the “Committee”). The Committee shall consist of two or more individuals who are officers and/or directors of the Company.
Reference to the Committee shall refer to the Board if the Compensation Committee ceases to exist and the Board does not appoint a successor Committee. Notwithstanding the foregoing, the full Board, acting by majority of its members in office shall
conduct the general administration of the Plan if required by Applicable Law, and with respect to Awards granted to Independent Directors and executive officers of the Company and for purposes of such Awards the term “Committee” as used in
the Plan shall be deemed to refer to the Board. 
 11.2 Action by the Committee. A majority of the Committee shall constitute a
quorum. The acts of a majority of the members present at any meeting at which a quorum is present, and acts approved in writing by a majority of the Committee in lieu of a meeting, shall be deemed the acts of the Committee. Each member of the
Committee is entitled to, in good faith, rely or act upon any report or other information furnished to that member by any officer or other employee of the Company or any Subsidiary, the Company’s independent certified public accountants, or any
executive compensation consultant or other professional retained by the Company to assist in the administration of the Plan. 
 11.3
Authority of Committee. Subject to any specific designation in the Plan, the Committee has the exclusive power, authority and discretion to: 
 (a) Designate Participants to receive Awards; 
 (b) Determine the type or types of Awards to be granted to each Participant;

 (c) Determine the number of Awards to be granted and the number of Shares to which an Award will relate; 
 (d) Determine the terms and conditions of any Award granted pursuant to the Plan, including, but not limited to, the exercise price, grant price, or
purchase price, any restrictions or limitations on the Award, any schedule for lapse of forfeiture restrictions or restrictions on the exercisability of an Award, and accelerations or waivers thereof, any provisions related to non-competition and
recapture of gain on an Award, based in each case on such considerations as the Committee in its sole discretion determines; 
  

 15 

 (e) Determine whether, to what extent, and pursuant to what circumstances an Award may be settled in, or
the exercise price of an Award may be paid in, cash, Shares, other Awards, or other property, or an Award may be canceled, forfeited, or surrendered; 
 (f) Prescribe the form of each Award Agreement, which need not be identical for each Participant; 
 (g)
Decide all other matters that must be determined in connection with an Award; 
 (h) Establish, adopt, or revise any rules and regulations as
it may deem necessary or advisable to administer the Plan; 
 (i) Interpret the terms of, and any matter arising pursuant to, the Plan or any
Award Agreement; and 
 (j) Make all other decisions and determinations that may be required pursuant to the Plan or as the Committee deems
necessary or advisable to administer the Plan. 
 11.4 Decisions Binding. The Committee’s interpretation of the Plan, any Awards
granted pursuant to the Plan, any Award Agreement and all decisions and determinations by the Committee with respect to the Plan are final, binding, and conclusive on all parties. 
 ARTICLE 12 
 EFFECTIVE AND EXPIRATION DATE 
 12.1 Effective Date. The Plan is effective as of the date the Plan is approved by the Company’s shareholders (the “Effective
Date”). The Plan will be deemed to be approved by the shareholders if it receives the affirmative vote of the holders of a majority of the share capital of the Company present or represented and entitled to vote at a meeting duly held in
accordance with the applicable provisions of the Company’s Memorandum of Association and Articles of Association. Notwithstanding the foregoing, the Effective Date shall not be later than the first anniversary of the date on which the Board
adopts the Plan (the “Board Adoption Date”). Between the Board Adoption Date and the Effective Date, the Committee may grant Options to any persons pursuant to the terms of the Plan, provided that none of such persons shall be allowed to
exercise the Options prior to the Effective Date. 
 12.2 Expiration Date. The Plan will expire on, and no Award may be granted
pursuant to the Plan after, the tenth anniversary of the Effective Date. Any Awards that are outstanding on the tenth anniversary of the Effective Date shall remain in force according to the terms of the Plan and the applicable Award Agreement.

 ARTICLE 13 
 AMENDMENT, MODIFICATION, AND TERMINATION 
 13.1 Amendment, Modification, And Termination. With the approval of the
Board, at 

  

 16 

 
any time and from time to time, the Committee may terminate, amend or modify the Plan; provided, however, that (a) to the extent necessary and
desirable to comply with any applicable law, regulation, or stock exchange rule, the Company shall obtain shareholder approval of any Plan amendment in such a manner and to such a degree as required, and (b) shareholder approval is required for
any amendment to the Plan that (i) increases the number of Shares available under the Plan (other than any adjustment as provided by Article 10), (ii) permits the Committee to grant Options with an exercise price that is below Fair Market
Value on the date of grant, (iii) permits the Committee to extend the exercise period for an Option beyond ten years from the date of grant, or (iv) results in a material increase in benefits or a change in eligibility requirements.

 13.2 Awards Previously Granted. Except with respect to amendments made pursuant to Section 14.14, no termination, amendment,
or modification of the Plan shall adversely affect in any material way any Award previously granted pursuant to the Plan without the prior written consent of the Participant. 
 ARTICLE 14 
 GENERAL PROVISIONS 
 14.1 No Rights to Awards. No Participant, employee, or other person shall have any claim to be granted any Award pursuant to the Plan, and neither
the Company nor the Committee is obligated to treat Participants, employees, and other persons uniformly. 
 14.2 No Shareholders
Rights. No Award gives the Participant any of the rights of a Shareholder of the Company unless and until Shares are in fact issued to such person in connection with such Award. 
 14.3 Taxes. No Shares shall be delivered under the Plan to any Participant until such Participant has made arrangements acceptable to the
Committee for the satisfaction of any income and employment tax withholding obligations under Applicable Laws, including without limitation the PRC tax laws, rules, regulations and government orders or the U.S. Federal, state or local tax laws, as
applicable. The Company or any Subsidiary shall have the authority and the right to deduct or withhold, or require a Participant to remit to the Company, an amount sufficient to satisfy federal, state, local and foreign taxes (including the
Participant’s payroll tax obligations) required by law to be withheld with respect to any taxable event concerning a Participant arising as a result of this Plan. The Committee may in its discretion and in satisfaction of the foregoing
requirement allow a Participant to elect to have the Company withhold Shares otherwise issuable under an Award (or allow the return of Shares) having a Fair Market Value equal to the sums required to be withheld. Notwithstanding any other provision
of the Plan, the number of Shares which may be withheld with respect to the issuance, vesting, exercise or payment of any Award (or which may be repurchased from the Participant of such Award after such Shares were acquired by the Participant from
the Company) in order to satisfy the Participant’s federal, state, local and foreign income and payroll tax liabilities with respect to the issuance, vesting, exercise or payment of the Award shall, unless specifically approved by the
Committee, be limited to the number of Shares which have a Fair Market Value on the date of withholding or repurchase equal to the aggregate amount of such liabilities based on the minimum statutory withholding rates for federal, state, local and
foreign income tax and payroll tax purposes that are applicable to such supplemental taxable income. 
  

 17 

 14.4 No Right to Employment or Services. Nothing in the Plan or any Award Agreement shall
interfere with or limit in any way the right of the Service Recipient to terminate any Participant’s employment or services at any time, nor confer upon any Participant any right to continue in the employ or service of any Service Recipient.

 14.5 Unfunded Status of Awards. The Plan is intended to be an “unfunded” plan for incentive compensation. With respect to
any payments not yet made to a Participant pursuant to an Award, nothing contained in the Plan or any Award Agreement shall give the Participant any rights that are greater than those of a general creditor of the Company or any Subsidiary.

 14.6 Indemnification. To the extent allowable pursuant to applicable law, each member of the Committee or of the Board shall be
indemnified and held harmless by the Company from any loss, cost, liability, or expense that may be imposed upon or reasonably incurred by such member in connection with or resulting from any claim, action, suit, or proceeding to which he or she may
be a party or in which he or she may be involved by reason of any action or failure to act pursuant to the Plan and against and from any and all amounts paid by him or her in satisfaction of judgment in such action, suit, or proceeding against him
or her; provided he or she gives the Company an opportunity, at its own expense, to handle and defend the same before he or she undertakes to handle and defend it on his or her own behalf. The foregoing right of indemnification shall not be
exclusive of any other rights of indemnification to which such persons may be entitled pursuant to the Company’s Memorandum of Association and Articles of Association,, as a matter of law, or otherwise, or any power that the Company may have to
indemnify them or hold them harmless. 
 14.7 Relationship to other Benefits. No payment pursuant to the Plan shall be taken into
account in determining any benefits pursuant to any pension, retirement, savings, profit sharing, group insurance, welfare or other benefit plan of the Company or any Subsidiary except to the extent otherwise expressly provided in writing in such
other plan or an agreement thereunder. 
 14.8 Expenses. The expenses of administering the Plan shall be borne by the Company and its
Subsidiaries. 
 14.9 Titles and Headings. The titles and headings of the Sections in the Plan are for convenience of reference only
and, in the event of any conflict, the text of the Plan, rather than such titles or headings, shall control. 
 14.10 Fractional
Shares. No fractional shares of Share shall be issued and the Committee shall determine, in its discretion, whether cash shall be given in lieu of fractional shares or whether such fractional shares shall be eliminated by rounding up or down as
appropriate. 
 14.11 Government and Other Regulations. The obligation of the Company to make payment of awards in Share or otherwise
shall be subject to all Applicable Laws, rules, and regulations, and to such approvals by government agencies as may be required. The Company 

  

 18 

 
shall be under no obligation to register any of the Shares paid pursuant to the Plan under the Securities Act or any other similar law in any applicable
jurisdiction. If the Shares paid pursuant to the Plan may in certain circumstances be exempt from registration pursuant to the Securities Act or other Applicable Laws the Company may restrict the transfer of such shares in such manner as it deems
advisable to ensure the availability of any such exemption. 
 14.12 Governing Law. The Plan and all Award Agreements shall be
construed in accordance with and governed by the laws of the Cayman Islands. 
 14.13 Section 409A. To the extent that the
Committee determines that any Award granted under the Plan is or may become subject to Section 409A of the Code, the Award Agreement evidencing such Award shall incorporate the terms and conditions required by Section 409A of the Code. To
the extent applicable, the Plan and the Award Agreements shall be interpreted in accordance with Section 409A of the Code and the U.S. Department of Treasury regulations and other interpretative guidance issued thereunder, including without
limitation any such regulation or other guidance that may be issued after the Effective Date. Notwithstanding any provision of the Plan to the contrary, in the event that following the Effective Date the Committee determines that any Award may be
subject to Section 409A of the Code and related Department of Treasury guidance (including such Department of Treasury guidance as may be issued after the Effective Date), the Committee may adopt such amendments to the Plan and the applicable
Award agreement or adopt other policies and procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, that the Committee determines is necessary or appropriate to (a) exempt the Award from
Section 409A of the Code and /or preserve the intended tax treatment of the benefits provided with respect to the Award, or (b) comply with the requirements of Section 409A of the Code and related U.S. Department of Treasury guidance.

 14.14 Appendices. The Committee may approve such supplements, amendments or appendices to the Plan as it may consider necessary or
appropriate for purposes of compliance with applicable laws or otherwise and such supplements, amendments or appendices shall be considered a part of the Plan; provided, however, that no such supplements shall increase the share limitations
contained in Sections 3.1 and 3.3 of the Plan. 
 * * * * * 
 I hereby certify that the foregoing Plan was duly adopted by the Board of Directors of Tongjitang Chinese Medicines Company on October 9, 2006. 
 * * * * * 
 I hereby certify that the foregoing Plan was approved by the shareholders
of Tongjitang Chinese Medicines Company on                         , 2006. 
 Executed on this      day of
                    , 2006. 
  

	
	  
 Corporate
Secretary

  

 19Subscription Agreement dated December 21, 2005

 Exhibit 10.4 
 Dated the 21st day of December, 2005 
 UNISOURCES ENTERPRISES LIMITED 
 and

 THOSE PERSONS WHOSE NAMES AND ADDRESSES ARE SET OUT IN 
 COLUMNS (1) AND (2) OF SCHEDULE 1 HERETO 
 and 
 SAMTUNG INVESTMENT LIMITED 
  

 SUBSCRIPTION AGREEMENT 
 relating to ordinary shares in 
 UNISOURCES ENTERPRISES LIMITED 
  

 David Lo & Partners

 Suite 2502 
 Nine Queen’s
Road Central 
 Hong Kong 
 25/01299/TTC 

 TABLE OF CONTENTS 
  

					
	 CLAUSE
	 	 HEADING
	  	PAGE
	 1.
	 	INTERPRETATION	  	3
			
	 2.
	 	CONDITIONS PRECEDENT	  	9
			
	 3.
	 	SUBSCRIPTION	  	10
			
	 4.
	 	MATTERS TO BE TRANSACTED IMMEDIATELY AND FORTHWITH AFTER SIGNING	  	10
			
	 5.
	 	DUE DILIGENCE	  	12
			
	 6.
	 	COMPLETION	  	12
			
	 7.
	 	REPRESENTATIONS, WARRANTIES, UNDERTAKINGS AND INDEMNITIES	  	14
			
	 8.
	 	USE OF FUNDS	  	16
			
	 9.
	 	CONDUCT OF BUSINESS	  	16
			
	 10.
	 	TERMINATION	  	17
			
	 11.
	 	GUARANTEE BY THE COMPANY’S GUARANTORS	  	18
			
	 12.
	 	COSTS AND EXPENSES	  	19
			
	 13.
	 	ANNOUNCEMENTS	  	19

  

 - 1 - 

					
			
	 14.
	    	NOTICES	  	19
			
	 15.
	    	MISCELLANEOUS	  	20
			
	 16.
	    	EXECUTION AND COUNTERPARTS	  	21
			
	 17.
	    	GOVERNING LAW AND JURISDICTION	  	21
		
	 EXECUTION PAGE
	  	23
		
	 SCHEDULE 1 PARTICULARS OF THE COMPANY’S GUARANTORS
	  	24
		
	 SCHEDULE 2 PART A THE COMPANY
	  	25
		
	 SCHEDULE 2 PART B TONG JI TANG
	  	26
		
	 SCHEDULE 3 THE WARRANTIES
	  	27
		
	 SCHEDULE 4 BVI CHARGE
	  	31
		
	 SCHEDULE 5 SHARE TRANSFER AGREEMENT
	  	32
		
	 SCHEDULE 6 ESCROW LETTER
	  	33

  

 - 2 - 

 THIS AGREEMENT              is made the
             day of December, 2005. 
 AMONG:- 
  

	(1)	UNISOURCES ENTERPRISES LIMITED, a company incorporated in the British Virgin Islands with limited liability and having its registered office at Pasea Estate, Road Town,
Tortola, British Virgin Islands (the “Company”); 

  

	(2)	THOSE PERSONS whose names and addresses are set out in columns (1) and (2) of Schedule 1 hereto (together the “Guarantors” or
“Company’s Guarantors” and each of them, a “Guarantor” or “Company’s Guarantor”); and 

  

	(3)	SAMTUNG INVESTMENT LIMITED, a company incorporated in the British Virgin Islands with limited liability and having its registered office at Pasea Estate, Road Town, Tortola,
British Virgin Islands (the “Subscriber”). 

 WHEREAS:- 
  

	(A)	The Company was incorporated on 22 November, 2004 as an exempted company under the Company Law of British Virgin Islands. As at the date of this Agreement, the entire issued
share capital of the Company is held as to approximately 76.93% by Hanmax Investment Limited, approximately 4.28% by Tanagram Investment Limited, approximately 6.79% by Paraway Investment Limited, approximately 11% by S-Yangtse Holdings Limited and
approximately 1% by Lodway Investment Limited. Particulars of the Company are set out in Part A of Schedule 2. 

  

	(B)	The Company and the Subscriber have agreed that the Company shall issue and the Subscriber shall subscribe for the Subscription Shares (as hereinafter defined) upon and subject to
the terms and conditions hereinafter appearing. 

  

	(C)	The Company’s Guarantors have agreed to guarantee the performance of the obligation for repayment of the Deposit (as defined below) under this Agreement.

 IT IS AGREED as follows:- 
  

	1.	INTERPRETATION 

  

	 	(A)	In this Agreement unless specifically provided otherwise or the context otherwise requires:- 

  

	 	(i)	the following expressions shall have the following meanings:- 

  

			
	 “Additional Warranties”            
	  	means those additional representations, warranties and undertakes to be given by the Company to the Subscriber upon such terms and conditions to be agreed between the

  

 - 3 - 

			
		
		    	Company and the Subscriber and “Additional Warranty” shall be construed accordingly;
		
	 “Agreement”
	    	means this Agreement (including its Schedules, annexure and exhibits) as may be supplemented or amended from time to time;
		
	 “Articles of Association”            
	    	means the articles of association of the Company;
		
	 “Auditors”
	    	means Deloitte Touche Tohmatsu;
		
	 “Business”
	    	 means:
 (a) the manufacture, sales and distribution of
medicine and other medical products by Tong Ji Tang; and
 (b) any other activities which the Board decides from time to time will be carried on by the
Company;

		
	 “Business Day”
	    	means a day (other than a Saturday or days on which a typhoon signal No. 8 or black rainstorm signal is hoisted in Hong Kong on or after 10:00 a.m.) on which banks are generally open for
business in Hong Kong;
		
	 “BVI Charge”
	    	means the first fixed charge granted by the Existing Majority Shareholders in favour of the Subscriber in respect of approximately 87.93% of the total issued shares of Company to secure the
Company’s obligations under Clause 2(C),or substantially in, the form attached hereto as Schedule 4;
		
	 “Completion”
	    	means completion of the allotment and issue of the Subscription Shares under this Agreement;
		
	 “Completion Date”
	    	means a date falling on the third Business Days after fulfilment (or waiver) of the Conditions or such other date as may be agreed between the Company and the Subscriber in
writing;
		
	 “Conditions”
	    	means the conditions precedent set out in Clause 2;

  

 - 4 - 

			
		
	 “Consent(s)”
	  	includes any license, consent, approval, authorization, permission, waiver, order or exemption;
		
	 “Consideration”
	  	means the consideration payable by the Subscriber to the Company for the Subscription Shares as referred to in Clause 3(B);
		
	 “Deed of Release”
	  	means the deed of release to be executed by the Subscriber in favour of the Existing Majority Shareholders to discharge and release the BVI Change upon such terms and conditions to be agreed
between the Existing Shareholders and the Subscriber;
		
	 “Deposit”
	  	means Hong Kong dollar equivalent of the sum of RMB43,000,000 being the deposit and part payment of the Consideration pursuant to Clause 3(B);
		
	 “Disclosed”
	  	means fairly disclosed in this Agreement;
		
	 “Encumbrance”
	  	any mortgage, charge, pledge, lien (otherwise than arising by statute or operation of law), hypothecation or other encumbrance, priority or security interest whatsoever over or in any property,
assets or rights of whatsoever nature and includes any agreement for any of the same;
		
	 “Escrow Agent”
	  	means David Lo & Partners, the escrow agent with which the documents referred to in Clause 2.02 of the BVI Charge are to be placed pursuant to the terms of this Agreement and the BVI
Charge;
		
	 “Escrow Letter”
	  	means the letter to be signed by the Company, the Subscriber and the Escrow Agent governing the terms and conditions of the escrow arrangement relating to the documents referred to in Clause
2.02 of the BVI Charge, a copy of which is attached to as Schedule 6;
		
	 “Existing Majority Shareholders”            
	  	means Hanmax Investment Limited and S-Yangtse Holdings Limited holding in aggregate approximately 87.93% of the issued share capital of the Company;

  

 - 5 - 

			
		
	 “Existing Shareholders”
	  	means Hanmax Investment Limited, Tanagram Investment Limited, Paraway Investment Limited, S-Yangtse Holdings Limited and Lodway Investment Limited being all the beneficial shareholders of the
Company;
		
	 “Group” or “Group Companies”            
	  	means the Company and the Subsidiaries; and each of them, a “Group Company” or a “Group Member”;
		
	 “Hanmax”
	  	means Hanmax Investment Limited;
		
	 “Hong Kong”
	  	means the Hong Kong Special Administrative Region of the PRC;
		
	 “Liabilities”
	  	means the aggregate of all consolidated liabilities (whether actual or contingent) and provisions including but not limited to any guarantee for any third parties liabilities and/or obligations,
shareholders loans, provisions for taxation, bad and doubtful debts, accounts payable, dividends or other distributions payable and all other liabilities including any depreciation and amortization;
		
	 “Long Stop Date”
	  	means 30 June 2006;
		
	 “Ordinary Shares”
	  	means ordinary shares of US$1.00 each in the issued share capital of the Company;
		
	 “PRC”
	  	means the People’s Republic of China (excluding Hong Kong);
		
	 “S-Yangtse”
	  	means S-Yangtse Holdings Limited;
		
	 “Shares”
	  	means shares in the capital of the Company (including, inter alia, Ordinary Shares);
		
	 “Share Transfer Agreement”
	  	means the share transfer agreement dated 6 June, 2005 between the Company, 

,

 whereby the Company agreed to acquire the entire registered capital of Tong Ji Tang from 

  

 - 6 - 

			
		
		  	

 and 

 for the consideration of Rmb41,000,000, a copy of which is attached hereto as Schedule 5;
		
	 “Shareholders’ Agreement”
	  	means the shareholders’ agreement to be entered into at Completion to regulate the rights and obligators of the Shareholders after Completion upon such terms and conditions to be agreed
between the Existing Shareholders and the Subscriber;
		
	 “Shareholders”
	  	means holders of Shares;
		
	 “Subscriber’s Solicitors”
	  	means David Lo and Partners of Suite 2502, 9 Queens Road Central, Hong Kong;
		
	 “Subscription Shares”
	  	means those Ordinary Shares to be subscribed by the Subscriber hereunder representing 12% of the enlarged issued share capital of the Company immediately after the allotment and issue of the
Subscription Shares at Completion provided based on the 39,760 Ordinary Shares in issue as at the date hereof, the Subscription Shares will be 5,422 Ordinary Shares;
		
	 “Subsidiaries”
	  	means subsidiaries of the Company as set out in Part B of Schedule 2 hereto;
		
	 “Supplemental Agreement”            
	  	means the supplemental agreement to be entered into at Completion provide for, inter alia, the Additional Warranties in favour of the Subscriber upon such terms and conditions to be agreed
between the parties hereto;
		
	 “Tong Ji Tang”
	  	means 

 (Guizhou Tong Ji Tang Medicine Manufacturing Company Limited), a company incorporated in the PRC;
		
	 “TJT Acquisition”
	  	means the acquisition of the entire registered capital of Tong Ji Tang by the Company from 

 and

;
		
	 “Warranties”
	  	means the representations, warranties and undertakings set out in this Agreement

  

 - 7 - 

			
		  	including without limitation to Clause 7 and Schedule 3 given by the Company and “Warranty” shall be construed accordingly;
		
	 “HK$”                    
	  	means Hong Kong dollars;
		
	 “RMB”
	  	means Renminbi;

  

	 	(ii)	words and expressions defined in the Companies Ordinance (Chapter 32 of the Laws of Hong Kong) shall bear the same respective meanings when used in this Agreement;

  

	 	(iii)	a body corporate shall be deemed to be associated with another body corporate if it is a holding company or a subsidiary of that other body corporate or a subsidiary of a holding
company of that body corporate; 

  

	 	(iv)	references herein to statutory provisions shall be construed as references to those provisions as amended or re-enacted or as their applications are modified by other provisions
(whether before or after the date hereof) from time to time and shall include any provisions of which they are re-enactments (whether with or without modification); 

  

	 	(v)	references herein to “Clauses” and “Schedules” are to clauses of and schedules to this Agreement unless the context requires otherwise and the Schedules to this
Agreement form an integral part of this Agreement; 

  

	 	(vi)	the Clause headings are inserted for convenience only and shall not affect the construction or interpretation of this Agreement; 

  

	 	(vii)	words importing the singular include the plural and vice versa, words importing a gender include every gender and references to persons include bodies corporate or unincorporate;

  

	 	(viii)	any statement qualified by the expression “to the best knowledge and belief of the Company” or “so far as the Company is aware” or any similar expression shall
be deemed to include an additional statement that it has been made after careful enquiry and shall be deemed also to include the knowledge of each Group Company; 

  

	 	(ix)	the expressions the “Company”, “Subscriber” and “Company’s Guarantors” shall, where the context permits, include their respective successors,
personal representatives and permitted assigns; and 

  

	 	(x)	the expression “written” or “writing” includes faxes but not email 

  

 - 8 - 

	2.	CONDITIONS PRECEDENT 

  

	 	(A)	Completion shall be subject to and conditional upon the satisfaction in full or (at the sole and absolute discretion of the Subscriber) the waiver of the following conditions:-

  

	 	(i)	the Subscriber notifying the Company in writing that it is satisfied with the results of the Due Diligence Review (as defined in Clause 5 below), including but not limited to the
satisfaction of the legal, financial and business position and prospects of the Group together with legal opinions from a PRC law firm and a legal counsel as to BVI laws respectively (both in forms and contents satisfactory to the Subscriber in its
absolute discretion); 

  

	 	(ii)	the terms of the Supplemental Agreement having been agreed by the parties hereto (in form and contents satisfactory to the Subscriber in its absolute discretion);

  

	 	(iii)	the terms of the Shareholders Agreement having been agreed by the parties hereto (in form and substance satisfactory to the Subscriber in its absolute discretion);

  

	 	(iv)	it has not come to the attention of the Subscriber that any material adverse changes in the Group or the Business or the financial position of any member of the Group have occurred
prior to the Completion Date or are likely to occur whether before the Completion Date. 

  

	 	(B)	The parties hereto acknowledge and agree that the conditions as set out in Clause 2(A) shall be deemed not to have been fulfilled upon occurrence of the following:

  

	 	(i)	in case of Condition 2(A)(i), the Subscriber notifying the Company at any time prior to Completion that it is not satisfied with the results of the Due Diligence Review whether or
not any explanations or reasons have been given and/or stated in such notification; 

  

	 	(ii)	in case of Condition 2(A)(ii), the Subscriber notifying the Company at any time prior to Completion that it is not satisfied with the proposed terms of the Supplemental Agreement
whether or not any explanations or reasons have been given and/or stated in such notification; 

  

	 	(iii)	in case of Condition 2(A)(iii), the Subscriber notifying the Company at any time prior to Completion that it is not satisfied with the proposed terms of the Shareholders Agreement
whether or not any explanations or reasons have been given and/or stated in such notification; and 

  

	 	(iv)	in case of Condition 2(A)(iv), the Subscriber notifying the Company at any time prior to Completion that the Subscriber has knowledge of some facts which will constitute or are
likely to constitute material adverse changes as referred to in Condition 2(A)(iv), whether or not any explanations or reasons have been given and/or stated in such notification. 

  

 - 9 - 

	 	(C)	In the event that any of the Conditions are deemed not to have been fulfilled under Clause 2(B) or are not fulfilled, in each case, at or before 5:00 pm on the Long Stop Date or
such later date as the parties hereto may from time to time agree in writing, the Deposit paid to the Company under Clause 3(B) below shall be returned and paid to the Subscriber by the Company within one month from the date of notification by the
Subscriber under Clause 2(B) above or from the Long Stop Date, as the case may be, and upon such payment to the Subscriber, the Subscriber shall (i) deliver to the Existing Majority Shareholders, the Deed of Release duly executed by the
Subscriber in favour of the Existing Majority Shareholders to release the BVI Charge; and (ii) give written instruction to the Escrow Agent to release the documents referred to in Clause 2.02 of the BVI Charge; and thereafter this Agreement and
everything contained in it shall terminate and be null and void and of no further effect and no party to this Agreement shall have any liability to any other party, save in respect of Clauses 12-17 and of any prior breaches of Clause 11 of this
Agreement. 

  

	3.	SUBSCRIPTION 

  

	 	(A)	Subject to the terms and conditions as set out herein, the Subscriber shall subscribe for and the Company shall allot and issue to the Subscriber the Subscription Shares credited as
fully paid. 

  

	 	(B)	The aggregate Consideration payable by the Subscriber to the Company for the subscription of the Subscription Shares shall be the Hong Kong dollar equivalent of a sum of
RMB100,000,000. 

  

	 	(C)	The Consideration shall be paid as follows:- 

 (i) upon signing of this Agreement, the Subscriber shall pay a sum of Hong Kong dollar equivalent to RMB43,000,000 to the Company as deposit and part payment of the Consideration for the subscription of the Subscription Shares to the
following account (“Account”) : 
  

					
	Name of Bank	  	:	  	DBS Bank (HK) Limited
	 Name of Account Holder
	  	:	  	Unisources Enterprises Limited
	 Account Number
	  	:	  	7881 135 520

  

	 	(ii)	upon Completion, the Subscriber shall pay the balance of the Consideration to the Company in its Hong Kong dollar equivalent. 

  

	4.	MATTERS TO BE TRANSACTED IMMEDIATELY AND FORTHWITH AFTER SIGNING 

  

	 	(A)	The following matters shall be transacted immediately upon the signing of this Agreement: 

  

 - 10 - 

	 	(i)	the Subscriber shall pay the Deposit to the Company in the manner as set out in Clause 3(C)(i) of this Agreement and shall deliver to the Company and the Company’s Guarantors
(i) certified copy of resolutions of the board of directors of the Subscriber approving this Agreement, the BVI Charge and the transactions contemplated hereunder and thereunder; and (ii) the Escrow Letter duly executed by the Subscriber and
the Escrow Agent; 

  

	 	(ii)	the Company shall appoint, Mr. Chen Yong Cun as director of the Company with effect from the date of this Agreement; 

  

	 	(iii)	the Company shall procure that the bank mandate of all bank accounts of the Company, including the Account, shall be changed with immediate effect such that all such bank accounts
shall be operated by Mr. Wang Xiaochun and Mr. Chen Yong Cun acting jointly; 

  

	 	(iv)	the Company shall deliver to the Subscriber: 

  

	 	(a)	the BVI Charge duly executed by the Existing Majority Shareholders; 

  

	 	(b)	certified copy of resolutions of the board of directors of the Company approving: 

  

	 	(i)	the Agreement and the transactions contemplated hereunder and thereunder; 

  

	 	(ii)	the appointment of Mr. Chen Yong Cun as director of the Company with effect from the date of this Agreement; 

  

	 	(iii)	the change of bank mandates of the Company as referred to in Clause 4(A)(iii) above; and 

  

	 	(iv)	certified copy of resolutions of the board of directors of each of the Existing Majority Shareholders approving the BVI Charge and the transactions contemplated thereunder;

  

	 	(B)	The Company shall procure that Mr. Chen Yong Cun shall forthwith be appointed as a director of Tong Ji Tang forthwith but in any event no later than one month from the date of
this Agreement; 

  

 - 11 - 

	 	(C)	As soon as practicable after the signing of this Agreement, the parties hereto shall negotiable in good faith with a view to agree and finalise (i) the terms of the
Shareholders’ Agreement to regulate the rights and obligations of the Shareholders after Completion and (ii) the terms of the Supplemental Agreement to provide for, inter alia, the Additional Warranties in favour of the Subscriber.

  

	5.	DUE DILIGENCE  

 The Subscriber shall be
entitled (but not obliged) to carry out at its costs and expenses a due diligence review and investigation on each member of the Group including without limitation to their assets, liabilities, contracts, commitments and business and financial and
legal aspects (“Due Diligence Review”). In order to facilitate the Due Diligence Review, the Company shall use its reasonable endeavours to, upon reasonable notice, procure that the Subscriber and/or any persons authorised by any of them
shall be given such information, data and documents relating to the members of the Group and within business hours, such access to the premises and all books, title deeds, records, accounts and other documentation of each member of the Group as the
Subscriber and/or their authorised persons may reasonably request. 
  

	6.	COMPLETION 

  

	 	(A)	Completion shall take place at Suite 2502, Nine Queen’s Road Central, Hong Kong on the Completion Date, or at such other place and time as shall be mutually agreed in writing
by the Subscriber and the Company, when the relevant business set out in Clause 6(B) shall take place, provided that neither the Subscriber nor the Company shall be obliged to perform their relevant obligations under Clause 6(B) if the other does
not simultaneously perform (or has not already performed) its relevant obligations thereunder. 

  

	 	(B)	At Completion:- 

  

	 	(i)	the Company shall allot and issue the Subscription Shares to the Subscriber and shall deliver to the Subscriber:- 

  

	 	(a)	certified copy of resolutions of the board of directors of the Company approving:- 

  

	 	(1)	the Shareholders’ Agreement and the transactions contemplated thereunder; 

  

	 	(2)	the Supplemental Agreement and the transactions contemplated thereunder; and 

  

	 	(3)	the allotment and issue of the Subscription Shares. 

  

 - 12 - 

	 	(b)	share certificate(s) for the Subscription Shares in the name of the Subscriber and/or their nominee as the Subscriber may direct and the Company shall promptly thereafter register
the Subscriber as a holder of the Subscription Shares; 

  

	 	(c)	the counterpart of the Shareholders’ Agreement duly executed by the Company; 

  

	 	(d)	the counterpart of the Supplemental Agreement duly executed by the Company. 

  

	 	(ii)	On or before Completion, the Company shall procure that a board meeting of the Company be held at which it shall be resolved that:- 

  

	 	(a)	the issue and allotment of the Subscription Shares be approved; and 

  

	 	(b)	the Shareholders’ Agreement and the Supplemental Agreement and the transactions contemplated thereunder. 

  

	 	(iii)	The Subscriber shall deliver to the Company:- 

  

	 	(a)	a cheque issued by a licensed bank in Hong Kong in favour of the Company in the sum equal to the balance of the Consideration; 

  

	 	(b)	written application(s) by the Subscriber and/or its nominee to subscribe for the Subscription Shares; 

  

	 	(c)	the counterpart of the Shareholders’ Agreement duly executed by the Subscriber; 

  

	 	(d)	the Deed of Release duly executed by the Subscriber; 

  

	 	(e)	certified copy of resolutions of the board of directors of the Subscriber approving this Agreement and the subscription of the Subscription Shares and the execution and completion
hereof and the execution of the Shareholders’ Agreement and the Deed of Release and of all documents incidental hereto; and 

  

	 	(f)	the instructions signed by the Subscriber to the Escrow Agent to release the documents referred to in Clause 2.02 of the BVI Charge. 

  

	 	(iv)	The Company’s Guarantors shall deliver to the Company and the Subscriber such documents to be agreed by the parties hereto which may include the Shareholders Agreement and/or
the Supplemental Agreement.:- 

  

	 	(C)	 Each of the parties hereto shall not be obliged to complete this Agreement or 

  

 - 13 - 

	 	 
perform any of its obligations under Clause 6(B) hereunder unless the other parties comply fully with the requirements of sub-Clauses 6(B)(i) to
(iv) above. Without prejudice to any other remedies which may be available to the non-defaulting party on the Completion Date, the non-defaulting party may:- 

  

	 	(a)	defer Completion to a date falling not more than 28 days after the original Completion Date (so that the provisions of this Clause 6 shall apply to the deferred Completion) provided
that, time shall be of the essence as regards the deferred Completion and if Completion is not effected on such deferred date, the non-defaulting party may rescind this Agreement and claim damages from the defaulting party; or

  

	 	(b)	proceed to Completion so far as practicable (but without prejudice to the non-defaulting party’s rights hereunder) insofar as the defaulting party shall not have complied with
its obligations hereunder; or 

  

	 	(c)	treat this Agreement as terminated for breach by the defaulting party of a condition of this Agreement. 

  

	 	(D)	As soon as practicable after Completion, and in any event no later than the expiry of two months after Completion, the parties hereto shall procure that the Articles of Association
be amended to reflect the terms of the Shareholders’ Agreement. 

  

	7.	REPRESENTATIONS, WARRANTIES, UNDERTAKINGS AND INDEMNITIES 

  

	 	(A)	Saved as Disclosed, the Company hereby irrevocably and unconditionally represents, warrants and undertakes to the Subscriber in the terms set out in Schedule 3 and that each
of the Warranties is now and will at all times up to Completion, be true, complete and accurate in all material respects on the basis that they were deemed to be repeated at the time of Completion and on the basis that a reference to such time is
substituted for any express or implied reference to the date of this Agreement and such warranties and representations shall be deemed to be given by the Company at such time as well as at Completion accordingly. The Company acknowledges that the
Subscriber have entered into this Agreement in reliance upon the Warranties. Subject to the matter Disclosed, no other information relating to the Group of which the Subscriber has knowledge (actual or constructive) and no investigation by or on
behalf of the Subscriber shall prejudice any claim made by the Subscriber under the Warranties or under the indemnities referred to in paragraph (D) below or operate to reduce any amount recoverable, and liability in respect thereof shall not
be confined to breaches discovered before Completion. 

  

	 	(B)	Each of the Warranties shall be construed as a separate and independent warranty to the intent that the Subscriber shall have a separate claim and right of action in respect of any
breach thereof and (except where expressly provided to the contrary) shall not be limited or restricted by reference to or inference from the terms of any other Warranty or any other term of this Agreement. 

  

 - 14 - 

	 	(C)	Subject to the provisions herein, the Warranties shall not in any respect be extinguished or affected by Completion. 

  

	 	(D)	Without prejudice to any other rights and remedies the Subscriber may have, but in any event subject to this Clause 7, the Company shall indemnify the Subscriber in respect of all
Claims: 

  

	 	(i)	made by any third party in relation to a matter which constitutes, or in circumstances that constitute, a material breach of any of the Warranties or any other representation in
this Agreement; or 

  

	 	(ii)	which the Subscriber suffer or incur by reason of any of the Warranties or any other representation made in this Agreement being untrue or inaccurate in any material respect.

  

	 	(E)	The Company shall forthwith notify the Subscriber upon becoming aware of any event which may cause any of the Warranties to be incorrect, misleading or breached in material respect
or which may have any material adverse effect on the assets or liabilities of the Company. The Company shall not do, allow or procure any act before Completion, which would constitute a material breach of any of the Warranties, if they were given at
Completion or which would make any of the Warranties inaccurate or misleading in any material respects if they were so given. 

  

	 	(F)	The liability of the Company in respect of any breach of Warranties shall be limited to the aggregate amount of the liability of the Company in respect of any claim for breach of
any of the Warranties shall not exceed the aggregate amount of the Consideration payable pursuant to Clause 3(B) (after deducting therefrom all legal and other expenses incurred in connection with this Agreement and any liability thereon).

  

	 	(G)	Notwithstanding anything contained in this Agreement including, but without limitation, Clause 7 and Schedule 3, but subject to the provisions as set out in this Clause 7(G), no
claims may be brought against the Company after the expiry of a period after the Completion Date to be agreed between the Company and the Subscriber (“Cut Off Date”), unless the Company shall have received written notice prior to the
expiry of the said Cut Off Date giving reasonable details of the relevant claim and any such claim shall be deemed (if it has not been previously satisfied, settled or withdrawn) to have been withdrawn after the expiry of 6 months after the
expiration of the said Cut Off Date, unless legal proceedings in respect thereof have been commenced and notice of which has been served on the Company. Notwithstanding that the Cut Off Date has yet to be agreed between the Company and the
Subscriber, nothing herein shall preclude the Subscriber from, and the Subscriber shall not be subject to any limitation in, taking legal actions against the Company at any time prior to the finalisation of the Cut Off Date between the Company and
the Subscriber. 

  

	 	(H)	The Subscriber represents to the Company that:- 

  

 - 15 - 

	 	(i)	the Subscriber has full power and authority to enter into, deliver and perform its obligations under this Agreement and all necessary corporate and other actions have been taken to
authorise the execution, delivery and performance by the Subscriber of this Agreement and the documents herein contemplated; 

  

	 	(ii)	the execution and performance of this Agreement and the documents herein contemplated do not violate any applicable law, rule, regulation or constitutional document to which the
Subscriber is subject; and 

  

	 	(iii)	this Agreement constitutes legal, valid and binding obligations on the Subscriber enforceable in accordance with the terms of this Agreement. 

  

	 	(I)	The Subscriber hereby undertakes to indemnify the Company against any damages, losses, costs, expenses or other liabilities which it may suffer or incur as a result of or in
connection with any breach of the representations and warranties set out in Clause 7(H) or any of the representations and warranties set out in Clause 7(H) being untrue or misleading. 

  

	 	(J)	Mr. Wang Xiaochun, one of the Company’s Guarantors hereby undertakes to the Company and the Subscriber that, save with the prior written consent of the Subscriber, he
shall remain the beneficial owner of more than 50% of the enlarged issued share capital of the Company immediately after the allotment and issue of the Subscription Shares. Mr. Wang Xiaochun further undertakes to the Company that the Company
shall remain the sole registered and beneficial owner of the total registered capital of Tong Ji Tang on or before Completion. 

  

	 	(K)	The rights and remedies of the Subscriber in respect of any breach of the Warranties shall not be affected by the Subscriber rescinding, or failing to rescind, this Agreement or any
other event or matter whatsoever except by way of a specific and duly authorised written waiver or release by the Subscriber. 

  

	8.	USE OF FUNDS 

 The Company undertakes to the
Subscriber that the Deposit shall be applied towards settlement of the consideration under the Share Transfer Agreement and the balance of the Consideration shall be used in such manner as provided in the Shareholders’ Agreement. 
  

	9.	CONDUCT OF BUSINESS 

  

	 	(A)	Until Completion, the Company undertakes to the Subscriber that, on or prior to Completion, the Group will only carry on the Business on a normal basis and in the ordinary and usual
course. 

  

 - 16 - 

	 	(B)	Until Completion, the Company shall ensure that the Subscriber is informed in writing of, and consulted about, any matter which shall or may materially affect the Business.

  

	10.	TERMINATION 

  

	 	(A)	In the event of it being found prior to Completion that any of the said Warranties are untrue, misleading or incorrect in material respect or have not been fully carried out to a
material extent, or in the event of any matter or thing arising or becoming known or being notified to the Subscriber which is materially inconsistent with any such Warranties or any other provision of this Agreement or in the event of the Company
becoming unable or failing to do anything required to be done by it at or before Completion, the Subscriber shall not be bound to complete this Agreement and the Subscriber may by notice rescind this Agreement without liability on its part. Upon
giving notice by the Subscriber to rescind this Agreement, the Company shall return the Deposit paid to the Company under Clause 3(B) of this Agreement within one month from the date of notification by the Subscriber. The right conferred upon the
Subscriber under this Clause is in addition to and without prejudice to any other rights of the Subscriber (including any rights to claim damages or compensation from the Company by reason of any such breach or non-fulfilment) and failure to
exercise it shall not constitute a waiver of any such rights. 

  

	 	(B)	In the event of termination of this Agreement for any reason, each party shall cease, and shall cause its permitted representative(s) and/or adviser(s) to cease, using any know-how,
intellectual property rights including copyright, trade marks, service marks and patents (including in each case application therefore and whether or not registered or registrable), trade secrets, technical processes or other confidential
information (“Confidential Information”) of another party (or in relation to Confidential Information of the Company, includes those relating to its Subsidiaries) and, at the other party’s option: 

  

	 	(a)	return to the other party; 

  

	 	(b)	destroy and certify in writing to the other party the destruction of; or 

  

	 	(c)	destroy and permit a representative of the other party to witness the destruction of, 

 all Confidential Information in its possession or control. 
  

	 	(C)	The parties hereto agree that Clauses 10(B), 12 and 13 shall continue to apply after termination of this Agreement and that termination of this Agreement does not affect any accrued
rights or remedies of a party. 

  

 - 17 - 

	11.	GUARANTEE BY THE COMPANY’S GUARANTORS ON REPAYMENT OF DEPOSIT 

  

	 	(A)	The Company’s Guarantors hereby unconditionally and irrevocably and severally (but not jointly or jointly and severally) guarantee to the Subscriber and its permitted
successors, transferees and assigns the due and punctual performance and observance by the Company of all its obligations to repay the Deposit under this Agreement or arising from any termination of this Agreement and if the Company defaults in
repayment of the Deposit when due of any amount payable to the Subscriber under this Agreement or arising from its termination, the Company’s Guarantors shall immediately on demand by the Subscriber, unconditionally pay that amount to the
Subscriber in the manner presented by this Agreement as if they were the Company and, without prejudice to the foregoing, as an independent and primary obligation of the Company’s Guarantors. The Company’s Guarantors unconditionally and
irrevocably and severally (but not jointly or jointly and severally) agree to indemnify and keep indemnified the Subscriber from and against all losses, damages, costs, claims, liabilities, demands and expenses of whatsoever nature which it may
suffer or incur arising from the failure of the Company to comply with any of its obligations, or discharge any of its liabilities to repay the Deposit under this Agreement or through any of the guaranteed obligations becoming unenforceable,
invalid, or illegal (on any grounds whether known to them or to the Subscriber or not). 

  

	 	(B)	If any of the obligations of the Company that are the subject of the guarantee contained in this Clause 11 (such guarantee being hereinafter referred to as “the Company
Guarantee”) cease to be valid or enforceable (in whole or in part) on any ground whatsoever (including, but not limited to, any defect in or want of powers of the relevant party or irregular exercise thereof or any lack of authority on the part
of any person purporting to act on behalf of the relevant party or any legal or other limitation, disability or incapacity, or any change in the constitution of, or any amalgamation or reconstruction of, or the liquidation receivership or insolvency
of the relevant party), the Company’s Guarantors shall nevertheless be liable to the Subscriber in respect of the purported obligation or liability as if the same were fully valid and enforceable and the Company’s Guarantors were the
principal obligors in respect thereof. 

  

	 	(C)	The liabilities of the Company’s Guarantors under the Company Guarantee shall not be discharged or affected in any way by:- 

  

	 	(a)	the Subscriber compounding or entering into any compromise, settlement or arrangement with the Company or any other person; or 

  

	 	(b)	any variation, extension, increase, renewal, determination, release or replacement of this Agreement whether or not made with the consent or knowledge of the Company’s
Guarantors; or 

  

	 	(c)	 the Subscriber granting any time, indulgence, concession, relief, discharge or release to the Company or any other person realising, giving up, agreeing to any
variation, renewal or replacement of, 

  

 - 18 - 

	 	 
releasing, abstaining from or delaying to taking advantage of or otherwise dealing with any securities from or other rights or remedies which it may have
against the Company or any other person; or 

  

	 	(d)	any other matter or thing which, but for this provision, might exonerate or affect the liabilities of the Company’s Guarantors. 

  

	 	(D)	For the avoidance of doubt, the liability of each Guarantor under the Company Guarantee shall be several and be shared between Wang Xiaochun and Wang Shaolan as to 87.48% and 12.52%
respectively. 

  

	 	(E)	The Subscriber shall not be obliged to take any steps to enforce any rights or remedy against the Company before enforcing the Company Guarantee. The Company Guarantee is in
addition to any other security or right now or hereafter available to the Subscriber. 

  

	12.	COSTS AND EXPENSES 

 Each of the parties
hereto shall bear its own costs and expenses (including legal fees and transaction costs) incurred in relation to the preparation, execution and performance of this Agreement. Any capital duty or other fees payable in relation to the issue of the
Subscription Shares shall be borne by the Company. 
  

	13.	ANNOUNCEMENTS 

 No announcement, press
release or other communication of any kind relating to the negotiations of the parties or the subject matter or terms of this Agreement and the BVI Charge shall be made or authorised by or on behalf of any party without the prior written approval of
each of the other parties unless that announcement, press release or communication is required to be made by law or any order of any court, tribunal, authority or regulatory body or under the rules and regulations of the relevant stock exchange, to
which such party is subject. 
  

	14.	NOTICES 

 Each notice, demand or other
communication given or made under this Agreement shall be in writing and delivered or sent to the relevant party at its address or fax number set out below (or such other address or fax number as the addressee has by two (2) Business Days’
prior written notice specified to the other parties):- 
 To the Company: 
  

					
	Address	  	:    	  	 c/o Suites 2701-2705& 2715-2716, 27/F.,
 Two
International Finance Centre
 8 Finance Street
 Central, Hong
Kong

	Fax Number                	  	:	  	2865 2583
	Attention	  	:	  	Mr. Chen Yan, Justin

  

 - 19 - 

					
	To the Company’s Guarantors:
			
	Address	  	:    	  	 c/o Suites 2701-2705& 2715-2716, 27/F.,
 Two
International Finance Centre
 8 Finance Street
 Central, Hong
Kong

	Fax Number	  	:	  	2865 2583
	Attention	  	:	  	Mr. Chen Yan, Justin
	
	To the Subscriber:
			
	Address	  	:	  	 Suite 4901, 49/F.,
 Office Tower, Convention
Plaza,
 1 Harbour Road, Wanchai,
 Hong Kong

	Fax Number	  	:	  	2802 9506
	Attention	  	:	  	Mr. Chen Yong Cun

 Any such notice or other document shall be deemed to have been duly given upon receipt if
delivered by hand or if sent by facsimile transmission upon the receipt of machine printed confirmation and in the case of a notice sent by post it shall be deemed to have been given on the second Business Day after posting if the address is within
Hong Kong. In providing the giving of a notice it shall be sufficient to prove that the notice was left or that the envelope containing such notice was properly addressed and posted or that the applicable means of telecommunication was properly
received (as the case may be). 
  

	15.	MISCELLANEOUS  

  

	 	(A)	This Agreement constitutes the whole agreement between the parties hereto and shall supersede the terms of any agreement, whether oral or otherwise, made prior to the entering into
of this Agreement. It is expressly declared that no purported variations hereof shall be effective unless made in writing and signed by all the parties hereto. 

  

	 	(B)	The provisions of this Agreement, insofar as the same shall not have been fully performed at Completion, shall remain in full force and effect notwithstanding Completion.

  

	 	(C)	Each of the Subscriber, the Company and the Company’s Guarantors shall at the request of any of the others do and execute or procure to be done and executed all such further
acts, deeds, things and documents as may be necessary to give effect to the terms of this Agreement and the transactions hereby contemplated. 

  

	 	(D)	No waiver by any party to this Agreement of any breach by any other party of any provision hereof shall be deemed to be a waiver of any subsequent breach of that or any other
provision hereof and any forbearance or delay by the relevant party in exercising any of its rights hereunder shall not be constituted as a waiver thereof. 

  

 - 20 - 

	 	(E)	Time shall be of the essence as regards any time, date or period mentioned in this Agreement and any time, date or period substituted for the same by agreement of the parties hereto
or otherwise. 

  

	 	(F)	The illegality, invalidity or unenforceability of any part of this Agreement shall not affect the legality, validity or enforceability of any other part of this Agreement.

  

	 	(G)	The provisions of this Agreement shall be binding on and shall enure for the benefit of the successors and assigns and personal representatives (as the case may be) of each party
provided that none of the parties hereto shall be entitled to transfer or assign any of its rights, benefits or obligations hereunder. 

  

	16.	EXECUTION AND COUNTERPARTS 

 This Agreement
may be executed in one or more counterparts each of which shall be binding on each party by whom or on whose behalf it is so executed, but which together shall constitute a single instrument. For the avoidance of doubt, this Agreement shall not be
binding on any party hereto unless and until it shall have been executed by or on behalf of all persons expressed to be party hereto. 
  

	17.	GOVERNING LAW AND JURISDICTION 

  

	 	(A)	This Agreement shall be governed by and construed in accordance with the laws of Hong Kong. 

  

	 	(B)	Each party hereby irrevocably submits to the non-exclusive jurisdiction of the courts of Hong Kong as regards any claim or matter arising under this Agreement.

  

	 	(C)	The Company hereby irrevocably appoints Woo, Kwan, Lee & Lo of 2718 Jardine House, 1 Connaught Place, Central, Hong Kong (for the attention of Mr. Brian Leung or
Miss Winnie Fung) as its service agent to receive and acknowledge on its behalf service of any notice, writ, summons, order, judgment or communication relation to this Agreement and further agrees that any such legal process or notice shall be
sufficiently served on it if delivered to such agent for service at its address for the time being in Hong Kong. 

  

	 	(D)	The Company’s Guarantors hereby irrevocably appoints Woo, Kwan, Lee & Lo of 2718 Jardine House, 1 Connaught Place, Central, Hong Kong (for the attention of
Mr. Brian Leung or Miss Winnie Fung) as its service agent to receive and acknowledge on its behalf service of any notice, writ, summons, order, judgment or communication relation to this Agreement and further agrees that any such legal
process or notice shall be sufficiently served on it if delivered to such agent for service at its address for the time being in Hong Kong. 

  

 - 21 - 

	 	(E)	The Subscriber hereby irrevocably appoints Silver Grant International Infrastructure Investment Limited of Suite 4901, 49/F., Office Tower, Convention Plaza, 1 Harbour Road,
Wanchai, Hong Kong as its service agent to receive and acknowledge on its behalf service of any notice, writ, summons, order, judgment or communication relation to this Agreement and further agrees that any such legal process or notice shall be
sufficiently served on it if delivered to such agent for service at its address for the time being in Hong Kong. 

  

	 	(F)	If the agent referred to in Clause 17(C) to 17(E) (or any replacement agent appointed pursuant to this sub-Clause) at any time ceases for any reason to act as such, the relevant
party shall appoint a replacement agent to accept service having an address for service in Hong Kong and shall notify the other parties of the name and address of the replacement agent. 

  

 - 22 - 

 EXECUTION PAGE 
 IN WITNESS whereof this Agreement has been entered into the day and year first above written. 
  

					
	SIGNED by	 	)            	 	
	duly authorised for and on behalf of	 	)            	 	
	UNISOURCES ENTERPRISES	 	)            	 	/s/ Wang Xiaochun
	LIMITED	 	)            	 	
	in the presence of :-	 	)            	 	
			
	 /s/ Winnie Wing Yee Fung
	 		 	
	Winnie Wing Yee Fung	 		 	
	Solicitor, Hong Kong SAR	 		 	
	Woo, Kwan, Lee & Lo	 		 	
			
	SIGNED, SEALED and DELIVERED by	 	)            	 	
	WANG XIAOCHUN	 	)            	 	/s/ Wang Xiaochun
	and in the presence of :-	 	)            	 	
			
	 /s/ Winnie Wing Yee Fung
	 		 	
	Winnie Wing Yee Fung	 		 	
	Solicitor, Hong Kong SAR	 		 	
	Woo, Kwan, Lee & Lo	 		 	
			
	SIGNED, SEALED and DELIVERED by	 	)            	 	
	WANG SHAOLAN	 	)            	 	/s/ Wang Shaolan
	and in the presence of :-	 	)            	 	
			
	 /s/ Winnie Wing Yee Fung
	 		 	
	Winnie Wing Yee Fung	 		 	
	Solicitor, Hong Kong SAR	 		 	
	Woo, Kwan, Lee & Lo	 		 	
			
	SIGNED by Chen Yong Cun	 	)            	 	
	duly authorised for and on behalf of	 	)            	 	
	SAMTUNG INVESTMENT LIMITED	 	)            	 	/s/ Chen Yongcun
	in the presence of :-	 	)            	 	
			
	 /s/ Wan Kam Fung
	 		 	
	Wan Kam Fung	 		 	
	Solicitor, Hong Kong SAR	 		 	
	David Lo & Partners	 		 	

  

 - 23 - 

 SCHEDULE 1 
 PARTICULARS OF THE COMPANY’S GUARANTORS 
  

					
	 (1)
	  	(2)	  	(3)
	 NAMES
	  	ADDRESS	  	 SHAREHOLDING
INTERESTS
 IN THE COMPANY

	 Wang Xiaochun
	  	No. 35, Zhengxin Street, Guiyang
City, Guizhou Province, PRC
Post Code 550001	  	Approximately 76.93%
			
	 Wang Shaolan
	  	Suites 2701-2705 & 2715 -2716,
27/F., Two International Finance
Centre, 8 Finance Street, Central,
Hong
Kong	  	Approximately 11%

  

 - 24 - 

 SCHEDULE 2 
 PART A 
 THE COMPANY 
  

					
	1. Name	  	:    	  	Unisources Enterprises Limited
			
	2. Registered office	  	:	  	Pasea Estate, Road Town, Tortola, British Virgin Islands
			
	3. Incorporation Date	  	:	  	22 November, 2004
			
	4. Place of Incorporation	  	:	  	British Virgin Islands
			
	5. Auditors	  	:	  	N/A
			
	6. Authorised share capital	  	:	  	US$50,000 divided into 50,000 ordinary shares of nominal value of US$1.00 each
			
	7. Issued and paid up share capital	  	:	  	as at the date of this Agreement
			
		  		  	US$39,760 divided into 39,760 shares of nominal value of US$1.00 each

 Ordinary shares are held as at the date of this Agreement as follows :- 
  

					
	 Name of Shareholder
	  	 	  	 No. of shares

	 Hanmax Investment Limited
	  		  	30,588
	 Tangram Investment Limited
	  		  	1,700
	 Paraway Investment Limited
	  		  	2,700
	 S-Yangtse Holdings Limited
	  		  	4,374
	 Lodway Investment Limited
	  		  	398
			
	8. Chairman	  	:    	  	N/A
			
	9. Directors	  	:	  	As at the date of this Agreement :-
		  		  	Wang Xiaochun
		  		  	Fang Honglong
		  		  	Lin Yuecai
		  		  	Xu Qian
		  		  	Hu Guangyi

  

 - 25 - 

 SCHEDULE 2 
 PART B 
 TONG JI TANG 
  

			
	1. Name	  	:    

		
	2. Registered office	  	:    

		
	3. Establishment Date	  	:    29 June 2005
		
	4. Place of Incorporation	  	:    the PRC
		
	5. Auditors	  	:    

		
	6. Registered capital	  	:    RMB39,760,000
		
	7. Registered capital is held as follows:	  	
		
	    Name of shareholder	  	    Amount of registered capital held
	    Unisources Enterprises Limited	  	    RMB39,760,000 or equivalent foreign currency
		
	8. Chairman	  	:    

 (Wang Xiaochun)
		
	9. Directors	  	:    

 (Wang Xiaochun)
		
		  	:    

 (Fang Honglong)
		
		  	    

 (Xu Qian)
		
		  	    

 (Lin Yuecai)
		
		  	    

 (Hu Guangyi)
		
		  	    

 (Li Wuying)

  

 - 26 - 

 SCHEDULE 3 
 THE WARRANTIES 
 In this Schedule, unless the context otherwise requires, each reference to the “Company”
shall be construed as a reference to each and every Group Company individually and each representation, warranty or undertaking shall be deemed to have been given in respect of each Group Company. References to the Business of the Company or the
Business of the Group shall be construed as references to the Business of each relevant Group Company. Subject to the matters referred to herein or Disclosed to the Subscriber, the Company represents and warrants and undertakes to the Subscriber
that all representations and statements of the facts set out in this Schedule 3 or otherwise contained in this Agreement are and will be true and accurate in all respects as at the date hereof and at all times up to and as at Completion.

  

	1.	General Information and Group Structure 

  

	1.1	The information in Schedule 2 are true, accurate and complete. 

  

	1.2	The issued capital or other ownership interest having ordinary voting power to elect directors, managers or trustees of the Company is free from any Encumbrances and is held
together with all rights and entitlements attached thereto. No Subsidiary has any type or class of securities or other ownership interest in issue which is different from the type or class of securities or other ownership interest held by a relevant
Group Company (other than as set out in its statutory records). No Group Company has agreed to issue or allot any securities or other ownership interest. 

  

	1.3	The Subsidiaries comprise all subsidiaries (whether direct or indirect) of the Group. No Group Company holds 20% or more shareholding interests or voting rights in any other company
and the Group has no other associated companies. 

  

	1.4	The Company is not and will not at Completion be the owner or the registered holder of any share or interest in or other security of or directly or indirectly interested in any body
corporate, partnership, joint venture or any form of equity wherever incorporated or established except as set out in Schedule 2, Part A and B. 

  

	2.	Subscription Shares 

  

	2.1	As at the date of this Agreement and immediately prior to Completion, the Company shall have sufficient authorised but unissued share capital to issue the Subscription Shares and it
will have full power and authority to allot and issue the Subscription Shares and such Subscription Shares when allotted and issued shall be in accordance with the Memorandum and Articles of Association of the Company and in compliance with all
relevant laws of the British Virgin Islands and rank pari passu in all respects with all other Shares in the issued share capital of the Company. 

  

	2.2	 The Subscription Shares when issued will be free from any liens, charges, 

  

 - 27 - 

	 	 
encumbrances, claims, equities or pre-emptive or third party rights of whatsoever nature and together with all rights and entitlements attaching thereto as
at the date of this Agreement and as at the Completion Date. 

  

	3.	Compliance with Legal Requirements 

  

	 	(a)	The Company has full power to enter into this Agreement and to exercise its rights and perform its obligations thereunder and (where relevant) all corporate and other actions
required to authorise their execution of this Agreement and the performance of their obligations under this Agreement have been duly taken and this Agreement will, when executed, comprise legal, valid and binding obligations on the Company
enforceable in accordance with their terms. 

  

	 	(b)	The execution, delivery and performance of this Agreement and the performance of the obligations by the Company thereunder does not and will not violate in any respect any provision
of: 

  

	 	(i)	any law of or order, writ, injunction or decree of any court in Hong Kong or any jurisdiction in which the Company is incorporated or any part thereof prevailing as at the date of
this Agreement and up to and including Completion; 

  

	 	(ii)	any agreement, commitment or other instrument to which the Company is a party or by which the Company or its assets may be bound or affected; 

  

	 	(iii)	the applicable laws, rules and regulations and documents incorporating and constituting the Company prevailing as at the date of this Agreement and up to and including Completion;
or 

  

	 	(iv)	any mortgage, contract or other undertaking or instrument to which the Company is a party or which is binding, upon them or any of their assets, and does not and will not result in
the creation or imposition of any Encumbrance on any of their assets. 

  

	 	(c)	Other than as set out in this Agreement, no filing or registration with or other requirement of any governmental, regulatory or other competent authority in Hong Kong or any
jurisdiction in which the Company is incorporated is required by the Company in relation to the valid execution, delivery or performance of this Agreement (or to ensure the validity or enforceability thereof) or any other ancillary documents
relating thereto. 

  

 - 28 - 

	4.	Shares and Options 

  

	4.1	The Existing Shareholders are the legal and beneficial owners of the entire issued share capital of the Company. The Company is the legal and beneficial owner of the entire
registered capital of Tong Ji Tang. 

  

	4.2	There is no Encumbrance on, over or affecting any part of the issued or unissued capital or loan capital of the Company and there is no agreement or commitment to give or create any
such Encumbrance and no claim has been made by any person to be entitled to any such Encumbrance which has not been fully waived or satisfied. 

  

	4.3	There is no agreement or commitment outstanding which calls for the allotment or issue or gives any person the right to call for the allotment or issue of any shares in or
securities or debentures of the Company. 

  

	5.	Corporate Matters 

  

	5.1	The Company is duly incorporated or established and validly existing under the laws of its place of incorporation or establishment. 

  

	5.2	The Memorandum and Articles of Association (or equivalent document) of the each member of the Group provided to the Subscriber are true, accurate and complete copies and no
alteration has been or will be made to such document after the date hereof. 

  

	6.	No Joint Venture 

 Save for Tong Ji Tang, the
Company is not and has not agreed to become a member of any joint venture, consortium, partnership or other unincorporated association; and it is not and has not agreed to become a party to any agreement or arrangement for sharing commissions or
other income. 
  

	7.	Tong Ji Tang 

  

	7.1	Tong Ji Tang is duly established and validly existing in the jurisdiction in which it is incorporated or established. 

  

	7.2	The documents for the incorporation of Tong Ji Tang and documents for the TJT Acquisition (including, inter alia, the Share Transfer Agreement) (together the “PRC
Documents”) are legally enforceable by and binding on the parties to the PRC Documents according to its terms (where applicable) under the applicable laws. 

  

	7.3	All necessary corporate actions and legal, regulatory and government actions in relation to the parties to the PRC Documents have been taken to authorise execution and performance
of the PRC Documents (where applicable) in accordance with all the applicable laws and regulations. 

  

 - 29 - 

	7.4	Each of the parties to the PRC Documents has full power, authority and legal right to enter into, execute, adopt, issue, deliver or perform its respective obligations under each of
the PRC Documents and such obligations constitute valid, legal and binding obligations enforceable against each of such parties in accordance with their respective terms. 

  

	7.5	Each of the parties to the PRC Documents has taken all necessary corporate actions and fulfilled and done all conditions and things required by the applicable laws and applicable
regulations (including the obtaining of any necessary approval, authorisation, exemption) for the entering into, execution, adoption, or issue of, or delivery of or the performance of its respective obligations under each of the PRC Documents, and
the representatives of each of the parties who executed each of the PRC Documents (where relevant) have been duly authorised to do so and no such action or authorisation has been revoked or materially amended. 

  

	7.6	All of the registered capital of the Tong Ji Tang have been fully paid up. 

  

	7.7	All governmental, regulatory or other authorisations, approvals and consents required for or in connection with the execution, issue, delivery, performance, legality, validity,
enforceability and admissibility in evidence of the PRC Documents and for the performance of the obligations thereunder and for all other matters and things contemplated thereby have been obtained and are in full force and effect. No further
authorisation or approval or other action by any governmental authority or other regulatory body is required for each of the parties to make, perform or effect the matter or transactions contemplated under all the PRC Documents (where applicable).

  

	7.8	There are no legal, administrative, arbitration or other proceedings pending challenging the effectiveness or the validity of the businesses and operations carried on by Tong Ji
Tang and/or the PRC Documents. 

  

	7.9	All Consents in relation to the TJT Acquisition have been obtained and are valid and subsisting. 

  

 - 30 - 

 SCHEDULE 4 
 BVI CHARGE 
  

 - 31 - 

 SCHEDULE 5 
 SHARE TRANSFER AGREEMENT 
  

 - 32 - 

 SCHEDULE 6 
 ESCROW LETTER 
  

 - 33 - 

 EXHIBIT A 
 Audited Accounts 
  

 - 34 -

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