UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO
RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of December 2024
Commission file number: 001-38307
RETO ECO-SOLUTIONS, INC.
(Registrant’s name)
c/o Beijing REIT Technology Development Co.,
Ltd.
X-702, 60 Anli Road, Chaoyang District, Beijing
People’s Republic of China 100101
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual
reports under cover of Form 20-F or Form 40-F.
Form 20-F ☒ Form 40-F ☐
INFORMATION CONTAINED IN THIS REPORT ON FORM
6-K
On December 30, 2024, ReTo
Eco-Solutions, Inc., a British Virgin Islands business company (the “Company”), entered into a Share Sale Agreement (the
“Agreement”) with Zhao Duan Wen (the “Buyer”), pursuant to which the Company agreed to sell all of its shares
in REIT Holdings (China) Limited, a Hong Kong limited company and a wholly-owned subsidiary of the Company (“REIT Holdings”),
to the Buyer for a purchase price of US$80,000 (the “Divestiture”). REIT Holdings is the holding company of multiple indirect
subsidiaries of the Company, which are engaged in in the business of manufacture and distribution of eco-friendly construction materials,
ecological restoration projects and software development services and solutions utilizing Internet of Things technologies. The board
of directors of the Company approved the Divestures based on considerations that these lines of business had experienced significant
losses over the years and that the Company plans to focus on existing and new businesses that are more profitable and promising. The
terms of the Agreement, including the purchase price, were negotiated based on an valuation report of a third-party appraisal firm.
Pursuant to the Agreement,
the Buyer shall bear any debts, claims and liabilities of REIT Holdings existing or potentially contingent prior to the closing of the
Divestiture (the “Closing”), or any default liabilities arising out of the management of the business. The Buyer may not make
any claim under the Agreement, including for a breach of warranty, unless full details of the claim have been notified to the Company
within 12 months from the Closing. The Agreement contains customary representations, warranties and covenants by the parties. The Company’s
total liability for any claims, subject to exclusions, under the Agreement is limited to US$100,000.
The Divestiture closed on December 31, 2024. Following the Divestiture,
the Company will no longer be engaged in the business of manufacture and distribution of eco-friendly construction materials, ecological
restoration projects and software development services and solutions utilizing Internet of Things technologies and will focus on research
and production of environmental protection technologies and equipment, application of new energy technologies, research and development
of artificial intelligence (AI) technology, as well as development of products and solutions of general health and wellness.
The foregoing description
of the Agreement does not purport to be complete and is qualified in its entirety by the full text of that agreement, a copy of which
is attached hereto as Exhibit 4.1.
INCORPORATION BY REFERENCE
This Report on Form 6-K and
the exhibits thereto, including any amendment and report filed for the purpose of updating such documents, shall be deemed to be incorporated
by reference into each of (i) the registration statement on Form F-3, as amended (File No. 333-267101), of the Company, (ii) the
registration statement on Form S-8, as amended (File No. 333-270355), of the Company, and (iii) the registration statement on Form S-8 (File No. 333-280119), of the Company and to be a part thereof from the date on which this Report on Form 6-K is furnished, to
the extent not superseded by documents or reports subsequently filed or furnished.
EXHIBIT INDEX
| + |
Certain portions of this exhibit are omitted pursuant to Item 601(b)(10)(iv) of Regulation S-K because they are not material and are the type that the Company treats as private or confidential. The Company hereby agrees to furnish a copy of any omitted portion to the SEC upon request. |
| ^ |
Certain portions of the exhibit have been omitted pursuant to Item 601(a)(6) of Regulation S-K. The Company hereby agrees to furnish a copy of any omitted portion to the SEC upon request. |
SIGNATURE
Pursuant to the requirements
of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.
| Date: January 6, 2025 |
RETO ECO-SOLUTIONS, INC. |
| |
|
| |
By: |
/s/ Hengfang Li |
| |
Name: |
Hengfang Li |
| |
Title: |
Chief Executive Officer |
2
Exhibit 4.1
CERTAIN IDENTIFIED INFORMATION HAS BEEN EXCLUDED
FROM THE EXHIBIT BECAUSE IT (i) IS NOT MATERIAL, (ii) IS THE TYPE THAT THE REGISTRANT TREATS AS PRIVATE OR CONFIDENTIAL, OR DISCLOSURE
OF SUCH INFORMATION WOULD CONSTITUTE A CLEARLY UNWARRANTED INVASION OF PERSONAL PRIVACY OR (iii) WOULD LIKELY CAUSE COMPETITIVE HARM TO
THE REGISTRANT IF PUBLICLY DISCLOSED. REDACTED INFORMATION IS MARKED WITH A [***].
Share
Sale Agreement
Dated December 30, 2024
ReTo Eco-Solutions, Inc. (“Seller”)
Zhao Duan Wen (“Buyer”)
Share Sale Agreement
Contents
| Details |
|
1 |
| General terms |
|
2 |
| 1 Interpretation |
|
2 |
| 1.1 Definitions |
|
2 |
| 1.2 References to certain general terms |
|
7 |
| 1.3 Next Business Day |
|
8 |
| 1.4 Headings |
|
8 |
| 2 Sale and purchase of Shares |
|
9 |
| 2.1 Sale and purchase |
|
9 |
| 3 Conditions Precedent |
|
9 |
| 3.1 Conditions Precedent |
|
9 |
| 3.2 Reasonable endeavours |
|
9 |
| 3.3 Termination by either party |
|
9 |
| 3.4 Effect of termination |
|
9 |
| 4 Completion |
|
9 |
| 4.1 Time and place of Completion |
|
9 |
| 4.2 Seller’s obligations |
|
10 |
| 4.3 Buyer’s obligations |
|
10 |
| 4.4 Simultaneous actions at Completion |
|
10 |
| 4.5 Post-Completion notices |
|
10 |
| 5 Payment of the Purchase Price |
|
11 |
| 5.1 Payment on Completion |
|
11 |
| 5.2 Method of payment |
|
11 |
| 5.3 Assumption of Debts and Claims |
|
11 |
| 6 Representations and warranties of Seller |
|
11 |
| 6.1 Warranties |
|
11 |
| 7 Limitations of Liability |
|
11 |
| 7.1 Notice of Claims |
|
11 |
| 7.2 Third party Claims |
|
12 |
| 7.3 Seller to consider Claims |
|
12 |
| 7.4 Seller to defend Claim |
|
12 |
| 7.5 Seller not liable |
|
13 |
| 7.6 Recovery |
|
13 |
| 7.7 Reduction in Purchase Price |
|
13 |
| 7.8 Time limit on Claim |
|
13 |
| 7.9 Minimum amount of Claim |
|
14 |
| 7.10 Maximum Liability |
|
14 |
| 7.11 Exclusion of consequential liability |
|
14 |
| 7.12 Insured Claim or loss |
|
14 |
| 7.13 Act or omission after Completion |
|
14 |
| 7.14 Later recoveries |
|
14 |
| 7.15 Obligation to mitigate |
|
15 |
| 7.16 Tax benefit |
|
15 |
| 8 Buyer’s warranties |
|
15 |
| 9 Confidential Information and privacy |
|
15 |
| 9.1 Confidential Information |
|
15 |
| 9.2 Disclosure of Confidential Information |
|
16 |
| 9.3 Use of Confidential Information |
|
16 |
| 9.4 Excluded Information |
|
16 |
| 9.5 Delivery of materials |
|
16 |
| 9.6 Privacy |
|
16 |
| 9.7 Application of clause 9.6 |
|
17 |
| 9.8 Use of Personal Information by Seller after Completion |
|
17 |
| 9.9 Survival of termination |
|
17 |
| 10 Announcements |
|
17 |
| 10.1 Public announcements |
|
17 |
| 10.2 Public announcements required by Law |
|
17 |
| 11 Costs and stamp duty |
|
18 |
| 11.1 Legal costs |
|
18 |
| 11.2 Stamp duty |
|
18 |
| 12 Notices and other communications |
|
18 |
| 12.1 Form - all communications |
|
18 |
| 12.2 Delivery |
|
18 |
| 12.3 When effective |
|
19 |
| 12.4 When taken to be received |
|
19 |
| 12.5 Receipt outside business hours |
|
19 |
| 13 Dispute Resolution |
|
19 |
| 13.1 Injunctive or interim relief |
|
19 |
| 13.2 Meeting |
|
19 |
| 13.3 Submission to arbitration |
|
19 |
| 13.4 Arbitration |
|
19 |
| 14 Miscellaneous |
|
20 |
| 14.1 No assignment |
|
20 |
| 14.2 Discretion in exercising rights |
|
20 |
| 14.3 Partial exercising of rights |
|
20 |
| 14.4 Approvals and consents |
|
20 |
| 14.5 Conflict of interest |
|
20 |
| 14.6 Remedies cumulative |
|
20 |
| 14.7 Rights and obligations are unaffected |
|
20 |
| 14.8 Variation and waiver |
|
20 |
| 14.9 No merger |
|
20 |
| 14.10 Indemnities |
|
20 |
| 14.11 Further steps |
|
21 |
| 14.12 Time of the essence |
|
21 |
| 14.13 Entire agreement |
|
21 |
| 14.14 Construction |
|
21 |
| 14.15 Counterparts |
|
21 |
| 14.16 Knowledge and belief |
|
21 |
| 14.17 No Recourse |
|
21 |
| 15 Governing Law, jurisdiction and service of process |
|
21 |
| 15.1 Governing Law |
|
21 |
| 15.2 Jurisdiction |
|
21 |
| 15.3 Serving documents |
|
21 |
| Schedule 1 - Shares |
|
22 |
| Schedule 2 – Warranties |
|
22 |
| Signing page |
|
25 |
| Annexure A - Final Evaluation Report |
|
26 |
Share
Sale Agreement
Details
THIS AGREEMENT is made on December 30, 2024
BETWEEN:
| (1) | ReTo Eco-Solutions, Inc., a business company incorporated in the British Virgin Islands with its registered address at Vistra Corporate
Service Centre, Wickhams Cay II, Road Town, Tortola, VG1110, British Virgin Islands (“Seller”); and |
| (2) | Zhao Duan Wen, a Chinese citizen of Macao (Macao ID number: [***]) (“Buyer”). |
RECITALS
| A | The Seller is the beneficial owner of the Shares in the capital of the Company as set out in schedule 1 , which Company owns equity
interests in the companies set out in schedule 1. The Company is, as at the date of this agreement, wholly owned by the Seller, and the
details of the equity interests of the companies held by the Company are as set out in schedule 1. |
| B | The Seller has agreed to sell, and the Buyer has agreed to buy, all of the Shares on the terms of this agreement. |
General
terms
These meanings apply unless the contrary intention appears.
Accounting Standards means the
International Financial Reporting Standards and interpretations approved by International Accounting Standards Board and currently in
use.
Action means an action, dispute,
Claim, demand, investigation, inquiry, prosecution, litigation, proceeding, arbitration, mediation, or dispute resolution.
Authorised Officer means, in respect
of a party, a director or secretary of the party or any other person appointed by a party to act as an Authorised Officer under this agreement.
Authority means any Government
Agency responsible for Tax in Hong Kong.
Board means the board of directors
of the Company.
Business means business of the
Company as it is presently being conducted at the date of this agreement.
Business Day means a day, other
than a Saturday or a general holiday (as defined in the General Holidays Ordinance (Cap 149 of the Laws of Hong Kong)) or, in in relation
to a day on which any payment is due under this Agreement only, a day on which a tropical cyclone No. 8 or above or a “black”
rainstorm warning is hoisted in Hong Kong at any time between 9:00am and 5:00pm, on which banks are open for the transaction of general
banking business in Hong Kong.
Claim includes any allegation,
debt, cause of action, Liability, claim, proceeding, suit or demand of any nature howsoever arising and whether present or future, fixed
or unascertained, actual or contingent, whether at law, in equity, under statute or otherwise, arising out of a breach or default of a
party’s Warranties, obligations or covenants under this agreement.
Company means REIT Holdings (China)
Limited, company number 740270, a company incorporated under the laws of Hong Kong:
Completion means completion of
the sale and purchase of the Shares in accordance with clause 4 (“Completion”) and Complete has a corresponding
meaning.
Completion Date means December
31, 2024, or any other date agreed by the Seller and the Buyer.
Conditions Precedent means the
conditions precedent set out in clause 3 (“Conditions Precedent”).
Confidential Information means
all Information disclosed to the Receiving Party or any Related Body Corporate or Representative of the Receiving Party, under or in connection
with this agreement or the transactions contemplated in this agreement, including:
| (a) | information which, either orally or in writing, is designated or indicated as being the proprietary or confidential information of
the Disclosing Party or any of its Related Bodies Corporate; and |
| (b) | information derived or produced partly or wholly from the Information including any calculation, conclusion, summary or computer modelling;
and |
| (c) | trade secrets or information which is capable of protection at law or equity as confidential information, |
whether the Information was disclosed:
| (d) | orally, in writing or in electronic or machine readable form; |
| (e) | before, on or after the date of this agreement; |
| (f) | as a result of discussions between the parties concerning or arising out of the acquisition of the Shares; or |
| (g) | by the Disclosing Party or any of its Representatives, any of its Related Bodies Corporate, any Representatives of its Related Bodies
Corporate or by any third person. |
Control of a corporation includes
the direct or indirect power to directly or indirectly:
| (a) | direct the management or policies of the corporation; or |
| (b) | control the membership of the board of directors, |
whether or not the power has statutory,
legal or equitable force or is based on statutory, legal or equitable rights and whether or not it arises by means of trusts, agreements,
arrangements, understandings, practices, the ownership of any interest in shares or stock of the corporation or otherwise.
Costs includes charges and expenses,
including those incurred in connection with advisers.
Disclosing Party means the party
disclosing Confidential Information.
Dispute includes any dispute,
controversy, difference or claim arising out of or in connection with this agreement or the subject matter of this agreement, including
any question concerning its formation, validity, interpretation, performance, breach and termination.
Due Diligence means the enquiries and investigations
into the Company carried out by the Buyer or Representatives of the Buyer.
Due Diligence Material means any information or
material provided by the Seller or a Related Body Corporate of the Seller or any of their respective Representatives or provided on behalf
of the Seller to the Buyer, a Related Body Corporate of the Buyer or Representatives of the Buyer.
Duty means any stamp, transaction
or registration duty or similar charge which is imposed by any Governmental Agency and includes but is not limited to, any interest, fine,
penalty, charge or other amount which is imposed in that regard.
Encumbrance means any:
| (a) | security for the payment of money or performance of obligations, including a mortgage, charge, lien, pledge, trust, power, title retention
or flawed deposit arrangement; or |
| (b) | right, interest or arrangement which has the effect of giving another person a preference, priority or advantage over creditors including
any right of set-off; or |
| (c) | right that a person (other than the owner) has to remove something from land (known as a profit à pendre), easement, public
right of way, restrictive or positive covenant, lease, or licence to use or occupy; or |
| (d) | third party right or interest or any right arising as a consequence of the enforcement of a judgment, |
or any agreement to create any of them or allow them to
exist.
Excluded Information means Confidential
Information which:
| (a) | is in or becomes part of the public domain other than through breach of this agreement or an obligation of confidence owed to the
Disclosing Party or any Related Body Corporate of the Disclosing Party; |
| (b) | the Receiving Party can prove by contemporaneous written documentation was already known to it at the time of disclosure by the Disclosing
Party or its Related Bodies Corporate or Representatives (unless such knowledge arose from disclosure of information in breach of an obligation
of confidentiality); or |
| (c) | the Receiving Party acquires from a source other than the Disclosing Party or any Related Body Corporate or Representative of the
Disclosing Party where such source is entitled to disclose it. |
Government Agency means any government,
governmental, semi-governmental, administrative, fiscal or judicial body, department, commission, authority, tribunal, agency or entity.
Hong Kong or HK means the
Hong Kong Special Administrative Region of the People’s Republic of China.
Incoming Directors means the persons
nominated by the Buyer to be directors of the Company from Completion.
Information means all information,
regardless of its Material Form, relating to or developed in connection with:
| (a) | the business, technology or other affairs of the Disclosing Party or any Related Body Corporate of the Disclosing Party or, in the
case of the Seller only, the Company; or |
| (b) | any systems, technology, ideas, concepts, know-how, techniques, designs, specifications, blueprints, tracings, diagrams, models, functions,
capabilities and designs (including computer software, manufacturing processes or other information embodied in drawings or specifications),
intellectual property or any other information which is marked “confidential” or is otherwise indicated to be subject to an
obligation of confidence owned or used by or licensed to the Disclosing Party or a Related Body Corporate of the Disclosing Party or,
in the case of the Seller only, the Company. |
A person is Insolvent if:
| (a) | an order is made or an effective resolution has been passed for it to be wound up or dissolved without winding up (other than to carry
out a reconstruction or amalgamation while solvent on terms approved by the other parties to this agreement); |
| (b) | a receiver, receiver and manager, administrative receiver, judicial manager, liquidator, provisional liquidator, liquidation committee,
official manager, administrator, trustee or other like official has been appointed (whether by a court or privately) over the whole or
any material part of its undertaking or property; |
| (c) | any distress, execution, sequestration or other similar process has been levied or enforced upon or sued out against the whole or
any material part of its property and has remained undischarged for a continuous period of more than 30 days; |
| (d) | it is subject to any arrangement, assignment, moratorium or composition, protected from creditors under any statute or dissolved (in
each case, other than to carry out a reconstruction or amalgamation while solvent on terms approved by the other parties to this agreement); |
| (e) | an application or order has been made (and in the case of an application, it is not stayed, withdrawn or dismissed within 30 days),
any notice given, resolution passed, proposal put forward, or any other action taken, which is preparatory to or could result in any of
(a), (b), (c) or (d) above; |
| (f) | it has made an assignment for the benefit of its creditors (including a class of creditors) generally; |
| (g) | it is unable or admits inability to pay its debts when they fall due, suspends making payments on any of its debts or, by reason of
actual or anticipated financial difficulties, commences negotiations with a creditor or any of its creditors generally to reschedule any
or all of its indebtedness; or |
| (h) | a situation substantially similar to any of those in (a) to (g) occurs in connection with that person under the Law of any jurisdiction. |
Final Valuation Report means the
valuation report on the fair value of 100% equity interests of the Company as of the Valuation Date, copies of which are attached as annexure
A (“Final Valuation Report”).
Valuation Date means October 31,
2024.
Law includes:
| (a) | any law, regulation, authorisation, ruling, judgment, order or decree of any Government Agency; and |
| (b) | any statute, regulation, proclamation, ordinance or by-law in: |
| (ii) | any other jurisdiction. |
Liability means any liability
or obligation (whether actual, contingent or prospective), including any Loss irrespective of when the acts, events or things giving rise
to the liability occurred.
Loss means all damage, loss, cost
and expense (including legal costs and expenses of whatsoever nature or description).
Material Form includes any form
(whether visible or not) of storage from which reproductions can be made.
Payment Account Details means,
in relation to any payment to be made under or pursuant to this agreement, the name, account number, sort code, account location and other
details specified by the payee and necessary to effect payment (whether by cheque, bankers’ draft, telegraphic or other electronic
means of transfer) to the payee.
Personal Information means information
or an opinion (including information or an opinion forming part of a database), whether true or not, and whether recorded in a Material
Form or not, about an individual whose identity is apparent, or can reasonably be ascertained, from the information or opinion.
Privacy Laws means any laws, industry
codes, policies or statements relating to the handling of Personal Information in Hong Kong in which the Company is incorporated.
Purchase Price means the aggregate
consideration payable for the Shares calculated in accordance with this agreement.
Receiving Party means the recipient
of Confidential Information.
Records means:
| (a) | minute books, statutory books and registers, books
of account and copies of taxation returns; and |
| (b) | financial and accounting records, |
in any Material Form relating to the
Company.
Recovered Sum means any amount
recovered by the Buyer under clause 7.6 (“Recovery”).
Related Body Corporate means in relation to a body
corporate:
| (a) | a holding company of that body corporate; |
| (b) | a subsidiary of that body corporate; or |
| (c) | a subsidiary of a holding company of that body corporate. |
Representative of a party includes
an employee, agent, officer, director, auditor, adviser, partner, consultant, joint venturer or sub-contractor of that party.
Retiring Directors means the existing
directors nominated to retire from the board of directors of the Company.
Securities means shares, debentures,
stocks, bonds, notes, interests in a managed investment scheme, units, warrants, options, derivative instruments or any other securities.
Shares means the issued shares
in the capital of the Company agreed to be sold under this agreement.
Tax means any income, turnover
or withholding taxes, which is assessed, levied, imposed or collected by any Authority and includes, but is not limited to any interest,
fine, penalty, charge, fee or any other amount imposed on, or in respect of any of the above.
Warranties means the warranties
and representations set out in schedule 2 (“Warranties”) and Warranty has a corresponding meaning.
| 1.2 | References to certain general terms |
Unless the contrary intention appears, a reference in this
agreement to:
| (a) | (variations or replacements) a document (including this agreement) includes any variation or replacement of it; |
| (b) | (clauses, annexures and schedules) a clause, annexure or schedule is a reference to a clause in or annexure or schedule to
this agreement; |
| (c) | (reference to statutes) a statute, ordinance, code or other law includes regulations and other instruments under it and consolidations,
amendments, re-enactments or replacements of any of them; |
| (d) | (singular includes plural) the singular includes the plural and vice versa; |
| (e) | (person) the word “person” includes an individual, a firm, a body corporate, a partnership, joint venture, an unincorporated
body or association, or any Government Agency; |
| (f) | (executors, administrators, successors) a particular person includes a reference to the person’s executors, administrators,
successors, substitutes (including persons taking by novation) and assigns; |
| (g) | (two or more persons) an agreement, representation or warranty in favour of two or more persons is for the benefit of them
jointly and each of them individually; |
| (h) | (Hong Kong dollars) HK dollars, HK$ or HKD is a reference to the lawful currency of Hong Kong; |
| (i) | (US dollars) US dollars, US$ or USD is a reference to the lawful currency of United States of America; |
| (j) | (calculation of time) a period of time dating from a given day or the day of an act or event, is to be calculated exclusive
of that day; |
| (k) | (reference to a day) a day is to be interpreted as the period of time commencing at midnight and ending 24 hours later; |
| (l) | (accounting terms) an accounting term is a reference to that term as it is used in Accounting Standards or, if not inconsistent
with those standards, in accounting principles and practices generally accepted in Hong Kong; |
| (m) | (reference to a group of persons) a group of persons or things is a reference to any two or more of them jointly and to each
of them individually; |
| (n) | (reference to subsidiary) a subsidiary in relation to a body corporate (the “Other Body”) is a reference to any
body corporate (the “First Body”) in which: |
| (A) | Controls the composition of the First Body’s board; |
| (B) | is in a position to cast, or Control the casting of, more than one-half of the maximum number of votes that might be cast at a general
meeting of the First Body; or |
| (C) | holds more than one-half of the issued share capital of the First Body (excluding any part of that issued share capital that carries
no right to participate beyond a specified amount in a distribution of either profits or capital); |
| (ii) | the First Body is a subsidiary of a subsidiary of the Other Body; |
| (iii) | the First Body is a subsidiary or otherwise Controlled by the Other Body within the meaning of the Accounting Standards; or |
| (iv) | the First Body is part of the consolidated entity constituted by the Other Body and the entities it is required to include in the
consolidated financial statements it prepares, or would be if the other body was required to prepare consolidated financial statements; |
| (o) | (reference to holding company) in relation to a body corporate, means a body corporate of which the first mentioned body corporate
is a subsidiary; |
| (p) | (meaning not limited) the words “include”, “including”, “for example” or “such as”,
when introducing an example, do not limit the meaning of the words to which the example relates to that example or examples of a similar
kind; |
| (q) | (time of day) time is a reference to Hong Kong time; |
| (r) | (reference to any thing) any thing (including any amount) is a reference to the whole and each part of it; and |
| (s) | (currency exchange) all amounts payable in connection with this agreement are to be settled in US dollars. Where an amount
is expressed to be in any currency other than US dollars, that amount is deemed to have been converted into US dollars at the rate of
exchange which is the USD medium exchange rate as published by People’s Bank of China on the business date immediately preceding
the date of payment. |
If an event under this agreement must occur on a stipulated
day which is not a Business Day then the stipulated day will be taken to be the next Business Day.
Headings (including those in brackets at the beginning
of paragraphs) are for convenience only and do not affect the interpretation of this agreement.
| 2 | Sale and purchase of Shares |
The Seller agrees to sell the Shares to the Buyer and the
Buyer agrees to buy the Shares from the Seller, for the Purchase Price, on the terms and conditions of this agreement.
Completion is conditional on:
| (a) | The sale of the Shares by the Seller in accordance with the terms and conditions of this agreement has been approved by the board
of the Seller; |
| (b) | The agreement has been signed by the Seller and the Buyer, and the Buyer has paid the Purchase Price in accordance with clause 5 under
this agreement. |
Each party must use its reasonable endeavours to obtain
the satisfaction of the Conditions Precedent, including procuring performance by a third party. The parties must keep each other informed
of any circumstances which may result in any Condition Precedent not being satisfied in accordance with its terms.
| 3.3 | Termination by either party |
The Conditions Precedent are inserted for the benefit of
the Buyer and the Seller and if any of the Conditions Precedent are not satisfied by December 31, 2024 or any later date agreed by the
Seller and the Buyer and have not been waived by the Seller and the Buyer, then, if the party who wishes to terminate this agreement has
complied with clause 3.2 (“Reasonable endeavours”) that
party may terminate this agreement at any time before Completion by notice given to the other party.
If this agreement is terminated under clause 3.3
(“Termination by either party”) then, in addition to any other rights, powers or remedies provided by law:
| (a) | each party is released from its obligations under this agreement other than in relation to clauses 9 (“Confidential Information
and privacy”) and 11.1 (“Legal costs”); |
| (b) | each party retains the rights it has against any other party in connection with any breach or Claim that has arisen before termination;
and |
| (c) | the Buyer must, at its own expense, return to the Seller any Records given to it or any other Confidential Information disclosed to
the Buyer or a Related Body Corporate or Representative of the Buyer. |
| 4.1 | Time and place of Completion |
Completion will take place at 3pm on the Completion Date
in Hong Kong or any other time and place agreed between the Seller and the Buyer.
On Completion, the Seller will give to the Buyer:
| (a) | (transfers and Share certificates) duly executed transfers in favour of the Buyer (or as it may direct) of all the Shares,
the share certificates for the Shares and any consents which the Buyer reasonably requires to obtain registration of those transfers; |
| (b) | (Records and common seal) the Records and the common seal (if any) of the Company, except that if the Seller is legally required
to retain any of the documents, the Seller may deliver copies of those documents to the Buyer; |
| (c) | (resignations) written resignations of the Retiring Directors; and |
| (d) | (directors resolution of the Company) a certified copy of a resolution of the Board resolving that: |
| (i) | subject to the payment of stamp duty, if applicable, the transfer of the Shares will be registered; and |
| (ii) | subject to the Memorandum and Articles and subject to them consenting to act, each of the Incoming Directors be appointed to the Board,
and the resignation of the Retiring Directors from the Board be accepted, all with effect from Completion, but so that a properly constituted
Board is in existence at all times. |
On Completion the Buyer must:
| (a) | (pay) pay the Seller in accordance with clauses 5.1 (“Payment on Completion”) and 5.2 (“Method of payment”); |
| (b) | (consent to act) deliver executed consents to act by the Incoming Directors; and |
| (c) | (Conditions Precedent) evidence that the Conditions Precedent set out in clause 3.1(a) (“Conditions Precedent”)
have been satisfied. |
| 4.4 | Simultaneous actions at Completion |
In respect of Completion:
| (a) | the obligations of the parties under this agreement are interdependent; and |
| (b) | unless otherwise stated, all actions required to be performed by a party at Completion are taken to have occurred simultaneously on
the Completion Date. |
| 4.5 | Post-Completion notices |
Each party will immediately give to the other party all
payments, notices, correspondence, information or enquiries in relation to the Company which it receives after Completion and which belong
to the other party.
| 5 | Payment of the Purchase Price |
At Completion, the Buyer will pay to the Seller of the
Purchase Price, in an amount of USD 80,000.
The payment:
| (a) | shall be made by way of telegraphic transfer to the Seller's account by 13:00pm (Hong Kong time) on the Completion Date. |
| 5.3 | Assumption of Debts and Claims |
The parties agree that any debts, claims
and liabilities of the Company existing or potentially contingent prior to the Completion Date, or any default liabilities arising out
of the management of the business, whether such debts, obligations and liabilities arose before or after the Completion Date, shall be
borne by the Buyer from and after the time of completion.
| 6 | Representations and warranties of Seller |
The Seller represents and warrants to the Buyer the statements
set out in schedule 2 (“Warranties”) on the date of this agreement and as at the Completion Date, as if these statements are
made on each of those dates. Except for the Warranties set out in schedule 2, the Seller has not made and does not make any representation
or warranty, whether express or implied, with respect to the Seller, the Shares, the Company or its businesses, operations, assets or
liabilities, or the transactions contemplated by this agreement or any other matter, and the Seller hereby expressly disclaims any other
representations or warranties, whether implied or made by the Seller or any of its Representatives.
| 7 | Limitations of Liability |
If the Buyer becomes aware of any matter or circumstance
that may give rise to a Claim, including a breach of a Warranty:
| (a) | the Buyer must immediately give notice of the Claim to the Seller; and |
| (b) | the notice must contain: |
| (i) | the facts, matters or circumstances that may give rise to the Claim; |
| (ii) | the basis for the allegation that the facts, matters or circumstances referred to in sub-clause (i) constitute a breach of this agreement,
including a breach of a Warranty; and |
| (iii) | an estimate of the amount of the Loss, if any, arising out of or resulting from the Claim or the facts, matters or circumstances that
may give rise to the Claim. |
If the matter or circumstance that may give rise to a Claim
against the Seller, including a breach of a Warranty, is a result of or in connection with a claim by or liability to a third party (a
“Third-Party Claim”) then:
| (a) | the Buyer must immediately give notice of the Third-Party Claim to the Seller; |
| (b) | the notice must contain: |
| (i) | the facts, matters or circumstances that may give rise to the Third-Party Claim; |
| (ii) | the basis for the allegation that the facts, matters or circumstances referred to in sub-clause (i) constitute a breach of this agreement
including a breach of a Warranty; and |
| (iii) | an estimate of the amount of the Loss, if any, arising out of or resulting from the Third-Party Claim or the facts, matters or circumstances
that may give rise to the Third-Party Claim; |
| (c) | at the expense and direction of the Seller, the Buyer must either: |
| (i) | take such Action (including legal proceedings or making claims under any insurance policies) as the Seller may require to avoid, dispute,
resist, defend, appeal, compromise or mitigate the Third-Party Claim; or |
| (ii) | offer the Seller the option to assume defence of the Third-Party Claim; and |
| (d) | the Buyer must not settle, make any admission of liability or compromise any Claim, or any matter which gives or may give rise to
a Claim, without the prior consent of the Seller which consent may be withheld by the Seller at its absolute discretion. |
| 7.3 | Seller to consider Claims |
The Seller must notify the Buyer within 10 Business Days
of receipt of a notice of a Claim under clause 7.1 (“Notice
of Claims”) or clause 7.2 (“Third party Claims”)
indicating whether it admits or denies the Claim (in whole or in part) (or, in the case of third party Claims, whether it exercises the
option in clause 7.2(c)(ii) (“Third party Claims”).
| 7.4 | Seller to defend Claim |
If the Seller exercises the option in clause 7.2(c)(ii)
(“Third Party Claims”), then:
| (a) | the Buyer agrees to co-operate with the Seller and do all things reasonably requested by the Seller in respect of the Third-Party
Claim; |
| (b) | the Seller agrees, at its own expense, to defend the Third-Party Claim; |
| (c) | the Seller may settle or compromise the Third-Party Claim with the consent of the Buyer, such consent not to be unreasonably withheld
or delayed; and |
| (d) | the Seller agrees to consult with the Buyer in relation to the conduct of the Third-Party Claim and not take or persist in any course
that might reasonably be regarded as harmful to the goodwill, reputation, affairs or operation of the Buyer or the Company. |
The Seller is not liable to the Buyer (or any person deriving
title from the Buyer) for any Claim (including a Third-Party Claim) under or in relation to or arising out of this agreement including
a breach of a Warranty:
| (a) | if the Buyer has failed to comply strictly with clause 7.1 (“Notice of Claims”) or clause 7.2 (“Third
party Claims”) as the case may be; |
| (b) | if the Buyer has ceased after Completion to own or Control the Company in respect of which the Claim arises; |
| (c) | if the Claim is as a result of or in consequence of any voluntary act, omission, transaction or arrangement of or on behalf of the
Buyer after Completion; |
| (d) | if the Claim is as a result of or in respect of any legislation not in force at the date of this agreement (including legislation
which takes effect retrospectively); |
| (e) | to the extent that the Claim arises or is increased as a result only of an increase in the rates, method of calculation or scope of
taxation after Completion; |
| (f) | to the extent that the Claim arises or is increased as a result of any change in Accounting Standards after Completion; |
| (g) | if the Claim arises or is increased as a result of action taken or not taken by the Seller after consultation with and the prior written
approval of the Buyer; |
| (h) | to the extent that provision has been made for any fact, matter or circumstance giving rise to a Claim in the Final Valuation Report;
or |
| (i) | if the Buyer was aware on or before the date of this agreement of any fact, matter or circumstance, which gives rise to or forms the
basis of the Claim. |
Where the Buyer is or may be entitled to recover from some
other person any sum in respect of any matter or event which could give rise to a Claim, the Buyer will:
| (a) | use its best endeavours to recover that sum before making the Claim; |
| (b) | keep the Seller at all times fully and promptly informed of the conduct of such recovery; and |
| (c) | reduce the amount of the Claim by the amount of the Recovered Sum. |
If the recovery is delayed until after the Claim has been
paid by the Seller to the Buyer the Recovered Sum will be paid to the Seller.
| 7.7 | Reduction in Purchase Price |
If payment is made for a breach of any Warranty, the payment
is to be treated as an equal reduction in the purchase price of each Share.
The Buyer may not make any Claim under this agreement including
for a breach of Warranty unless full details of the Claim have been notified to the Seller in accordance with clause 7.1
(“Notice of Claims”) or clause 7.2 (“Third party
Claims”) within 12 months from the Completion Date. A Claim will not be enforceable against the Seller and is to be taken for all
purposes to have been withdrawn unless any legal proceedings in connection with the Claim are commenced within three months after written
notice of the Claim is served on the Seller in accordance with clause 7.1
(“Notice of Claims”) or clause 7.2 (“Third party
Claims”).
| 7.9 | Minimum amount of Claim |
The Buyer may not make any Claim under this agreement including
for a breach of Warranty:
| (a) | if the amount of the Claim is less than US$50,000 |
| (b) | unless and until the aggregate amount of all Claims properly made under this agreement exceeds US$100,000, |
in which event the Seller’s liability will be limited
to the amount by which such amount is exceeded.
The Seller’s total liability for loss or damage of
any kind not excluded by clause 7.11 (“Exclusion of consequential
liability”) however caused, in contract, tort, (including negligence), under any statute or otherwise from or relating in any way
to this agreement or its subject matter is limited in aggregate for any and all Claims to US$100,000.
| 7.11 | Exclusion of consequential liability |
The Seller excludes all liability for indirect and consequential
loss or damage (including for loss of profit (whether direct, indirect, anticipated or otherwise), loss of expected savings, opportunity
costs, loss of business (including loss or reduction of goodwill), damage to reputation and loss or corruption of data regardless of whether
any or all of these things are considered to be indirect or consequential losses or damage) in contract, tort (including negligence),
under any statute or otherwise arising from or related in any way to this agreement or its subject matter.
| 7.12 | Insured Claim or loss |
The Seller will not be liable for any Claim under or in
relation to or arising out of this agreement including a breach of a Warranty unless the Buyer has first caused the Company to make a
Claim under any insurance policy held by that Company which may cover that Claim and that Claim has been denied in whole or in part by
the relevant insurer. If the Buyer has still incurred some damage or Loss, that remaining amount will be the amount of the Buyer’s
Loss for the purposes of this agreement.
| 7.13 | Act or omission after Completion |
The Seller’s liability to the Buyer for loss or damage
of any kind in contract, tort (including negligence), under any statute or in relation to or arising out of this agreement including a
breach of a Warranty will be reduced to the extent that the Claim arises as a result of or in connection with any act or omission after
Completion by the Buyer or any Company.
If, after the Seller has made a payment to the Buyer pursuant
to a Claim under or in relation to or arising out of this agreement, including a breach of a Warranty, the Buyer, a Company receives a
payment or benefit in relation to the fact, matter or circumstance to which the Claim related, then the Buyer must repay to the Seller
the amount received from the Seller or, if less, the amount of the payment or benefit which was received by the Buyer, that Company.
| 7.15 | Obligation to mitigate |
Nothing in this clause 7
(“Limitations of Liability”) in any way restricts or limits the general obligation at Law of the Buyer to mitigate any Loss
or damage which it may incur in consequence of any breach by the Seller of the terms of this agreement including a breach of a Warranty.
In calculating the Liability of the Seller for a Claim
arising under, in relation to or arising out of this agreement, including a breach of any Warranty, any tax benefit or reduction received
by the Buyer as a result of the loss or damage arising from that breach must be taken into account.
The Buyer represents and warrants to the Seller the following
statements on the date of this agreement and as at the Completion Date, as if these statements are made on each of those dates:
| (a) | it has the power to enter into and perform this agreement and has obtained all necessary consents and authorisations to enable it
to do so; |
| (b) | the entry into and performance of this agreement by it does not constitute a breach of any obligation (including any statutory, contractual
or fiduciary obligation), or default under any agreement or undertaking by which it is bound; |
| (c) | this agreement constitutes valid and binding obligations upon it enforceable in accordance with its terms by appropriate legal remedy; |
| (d) | this agreement and Completion do not conflict with or result in a breach of or default under any applicable Law, any provision of
its constitution or any material term or provision of its constitution or any material term or provision of any agreement or deed or writ,
order or injunction, judgment, Law, rule or regulation to which it is a party or is subject or by which it is bound; |
| (e) | no voluntary arrangement has been proposed or reached with any creditors of the Buyer; and |
| (f) | the Buyer is able to pay its debts as and when they fall due and is not Insolvent. |
| (g) | the Buyer has sufficient funds readily available to fulfil its obligations under this agreement. |
The Buyer represents and warrants to
the Seller that as at the Completion Date, the Buyer has all relevant permits, consents, licences, authorisations and registrations (or
otherwise has the benefit of an exemption from the requirement to hold such permits, consents, licences, authorisations and registrations)
required under relevant Laws for it to acquire the shares in the Company.
| 9 | Confidential Information and privacy |
| 9.1 | Confidential Information |
Subject to clause 9.6
(“Privacy”), no Confidential Information may be disclosed by the Receiving Party to any person except:
| (a) | to Representatives of the Receiving Party or its Related Bodies Corporate requiring the information for the purposes of this agreement; |
| (b) | with the consent of the Disclosing Party; |
| (c) | if the Receiving Party is required to do so by Law, a stock exchange or any regulatory authority; or |
| (d) | if the Receiving Party is required to do so in connection with legal proceedings relating to this agreement. |
| 9.2 | Disclosure of Confidential Information |
If the Receiving Party discloses information under clause
9.1(a) or (b) (“Confidential Information”) the Receiving
Party must use its reasonable endeavours to ensure that recipients of the Confidential Information do not disclose the Confidential Information
except in the circumstances permitted in clause 9.1 (“Confidential
Information”).
| 9.3 | Use of Confidential Information |
The Buyer must not use any Confidential Information except
for the purpose of performing its obligations under this agreement.
Clauses 9.1
(“Confidential Information”), 9.2 (“Disclosure
of Confidential Information”) and 9.3 (“Use of Confidential
Information”) do not apply to Excluded Information.
The Receiving Party must, on the request of the Disclosing
Party, immediately deliver to the Disclosing Party or otherwise destroy all documents or other materials containing or referring to Confidential
Information of the Disclosing Party which are:
| (a) | in the Receiving Party’s possession, power or control; or |
| (b) | in the possession, power or control of persons who have received Confidential Information under clause 9.1(a) or (b) (“Confidential
Information”). |
The Buyer agrees:
| (a) | to comply with all Privacy Laws; |
| (i) | by which it is bound; and |
| (ii) | by which the Seller is bound and notifies the Buyer, |
in connection with Personal Information
collected, used or disclosed in connection with the Business or this agreement;
| (b) | to notify the Seller immediately after it becomes aware that a disclosure of Personal Information may be required by Law before Completion; |
| (c) | not to do anything with the Personal Information that may cause the Seller to be in breach of a Privacy Law applicable in Hong Kong; |
| (d) | to notify the Seller of any request the Buyer receives before Completion for access to Personal Information which the Seller has disclosed
to the Buyer; |
| (e) | not to give access to, or copies of, Personal Information disclosed by the Seller to the Buyer to anyone without the Seller’s
consent; |
| (f) | to the Seller retaining Personal Information which is part of the Confidential Information to the extent that it is required to be
retained by the Seller pursuant to this agreement or by Law; |
| (g) | to use Personal Information disclosed by the Seller during Due Diligence only for the purpose of carrying out the Due Diligence; |
| (h) | to handle Personal Information disclosed by the Seller during Due Diligence in a manner as directed by the Seller; and |
| (i) | to notify the Seller immediately after the Buyer becomes aware that it has breached these agreements. |
| 9.7 | Application of clause 9.6 |
Clause 9.6
(“Privacy”) prevails over the balance of this clause 9
(“Confidential information and privacy”) to the extent of any inconsistency in respect of Personal Information which is also
Confidential Information.
| 9.8 | Use of Personal Information by Seller after Completion |
If the Seller is required by this agreement or by Law to
retain any Personal Information which is part of the Confidential Information, the Seller may use and disclose that Personal Information
for the purpose for which it is required to be retained under this agreement or as required by that other Law or by any Privacy Laws.
| 9.9 | Survival of termination |
This clause 9
(“Confidential information and privacy”) will survive termination of this agreement.
Subject to clause 10.2
(“Public announcements required by Law”), no party may, before or after Completion, make or send a public announcement, communication
or circular concerning the transactions referred to in this agreement unless it has first obtained the written consent of the other parties
which consent is not to be unreasonably withheld, conditioned or delayed.
| 10.2 | Public announcements required by Law |
Clauses 9.1
(“Confidential Information”) and 10.1 (“Public
announcements”) do not apply to a public announcement, communication, circular, filing or other disclosure made by
| (i) | a party and required by Law, if the party required to make
or send it has: |
| (a) | provided the other party with sufficient notice to enable it to seek a protective order or other remedy; and |
| (b) | provided all assistance and co-operation that the other party considers necessary to prevent or minimise that disclosure. |
| (ii) | Seller and required by United States securities laws or the
requirements of the United States Securities and Exchange Commission or applicable stock exchange, so long as Seller has provided an
opportunity for Seller to review and comment on such public announcement, communication, circular, filing or other disclosure reasonably
in advance of such disclosure. |
The Seller and the Buyer agree to pay their own legal and
other costs and expenses in connection with the negotiation, preparation, execution and completion of this agreement and of other related
documentation, except for stamp duty.
Each party shall pay its own stamp duty (including fines
and penalties) chargeable, payable or assessed in relation to this agreement and the transfer of the Shares to the Buyer.
| 12 | Notices and other communications |
| 12.1 | Form - all communications |
Unless expressly stated otherwise in this agreement, all
notices, certificates, consents, approvals, waivers and other communications in connection with this agreement must be:
| (b) | signed by the sender (if an individual) or an Authorised Officer of the sender; and |
| (c) | marked for the attention of the person identified in clause 12.2 or, if the recipient has notified otherwise, then marked for
attention in the way last notified. |
Communications must be delivered to:
| (a) | in the case of the Buyer: |
Address: [***]
Email Address:
Attention:
| (b) | in the case of the Seller: |
Address: Room 702, Building X, Runfengdeshang, 60 Anli Road, Chaoyang District, Beijing
Email Address: [***]
Attention: Hengfang Li
However, if the intended recipient has notified a changed
address or fax number, then communications must be to that address or fax number.
Communications take effect from the time they are received
or taken to be received under clause 12.4 (“When taken to be
received”) (whichever happens first) unless a later time is specified.
| 12.4 | When taken to be received |
Communications are taken to be received:
| (a) | if sent by post, three days after posting (or seven days after posting if sent from one country to another); or |
| (b) | if sent by fax, at the time shown in the transmission report as the time that the whole fax was sent. |
| 12.5 | Receipt outside business hours |
Despite clauses 12.3
(“When effective”) and 12.4 (“When taken to be
received”), if communications are received or taken to be received under clause 12.4
after 5.00pm in the place of receipt or on a non-Business Day, they are taken to be received at 9.00am on the next Business Day and take
effect from that time unless a later time is specified.
| 13.1 | Injunctive or interim relief |
Nothing in this clause 13
prevents a party seeking urgent injunctive or similar interim relief from a court.
If a party gives the other party a written
notice claiming that a Dispute has arisen and the parties are unable to resolve the Dispute within 15 Business Days of service of that
notice, then each party must:
| (a) | use its best endeavours to ensure that a meeting is held in an effort to resolve the Dispute; and |
| (b) | make available a representative who has authority to settle the Dispute to attend that meeting. |
| 13.3 | Submission to arbitration |
If the meeting referred to in clause 13.2
either:
| (a) | takes place and the parties are unable to resolve the Dispute within 10 Business Days of the meeting taking place; or |
| (b) | does not take place for any reason within 15 Business Days of service of the notice, |
then either party is entitled to refer the Dispute to arbitration
in accordance with the requirements and procedures set out in the remainder of this clause 13.
Subject to clauses 13.1 (“Injunctive or interim
relief”) to 13.3 (“Submission to arbitration”), any Dispute shall be referred to the Hong Kong International Arbitration
Center for final resolution by arbitration in accordance with the Hong Kong International Arbitration Centre Administered Arbitration
Rules (“Rules”). The seat of the arbitration will be Hong Kong. The tribunal is to consist of one arbitrator appointed
in accordance with the Rules. The language of the arbitration is English. All legal and arbitration expenses shall be paid by the losing
party. If it becomes necessary for a party to enforce an arbitral award by legal action of any kind, the defaulting party shall pay all
legal cost and expenses and attorney’s fees, including any cost of additional litigation or arbitration that shall be incurred by
the party seeking to enforce the award.
No party may assign or otherwise deal with its rights under
this agreement or allow any interest in them to arise or be varied, in each case without the written consent of the other party, which
consent must not be unreasonably withheld, conditioned or delayed.
| 14.2 | Discretion in exercising rights |
A party may exercise a right or remedy or give or refuse
its consent in any way it considers appropriate (including by imposing conditions), unless this agreement expressly states otherwise.
| 14.3 | Partial exercising of rights |
Except as otherwise set out in this agreement, if a party
does not exercise a right or remedy fully or at a given time, the party may still exercise it later.
| 14.4 | Approvals and consents |
By giving its approval or consent a party does not make
or give any warranty or representation as to any circumstance relating to the subject matter of the consent or approval.
The parties’ rights and remedies under this agreement
may be exercised even if it involves a conflict of duty or a party has a personal interest in their exercise.
The rights and remedies provided in this agreement are
in addition to other rights and remedies given by law independently of this agreement.
| 14.7 | Rights and obligations are unaffected |
Rights given to the parties under this agreement and the
parties’ liabilities under it are not affected by anything which might otherwise affect them by Law.
A provision of this agreement or a right created under
it, may not be waived or varied except in writing, signed by the party or parties to be bound.
The warranties, undertakings and indemnities in this agreement
do not merge and are not extinguished on Completion and will survive after Completion.
Subject to this agreement, including without limitation
clause 7 hereof, the indemnities in this agreement are continuing obligations, independent from the other obligations of the parties under
this agreement. It is not necessary for a party to incur expense or make payment before enforcing a right of indemnity under this agreement.
Each party agrees, at its own expense, to do anything the
other party asks (such as obtaining consents, signing and producing documents and getting documents completed and signed) as may be necessary
or desirable to give full effect to the provisions of this agreement and the transactions contemplated by it.
Time is of the essence of this agreement in respect of
any date or period determined under this agreement
This agreement constitutes the entire agreement of the
parties about its subject matter and supersedes all previous agreements, understandings and negotiations on that subject matter.
No rule of construction applies to the disadvantage of
a party because that party was responsible for the preparation of, or seeks to rely on, this agreement or any part of it.
This agreement may be executed in counterparts. All counterparts
when taken together are to be taken to constitute one instrument.
| 14.16 | Knowledge and belief |
Any statement made by a party on the basis of its knowledge,
information, belief or awareness, is made on the basis that the party has, in order to establish that the statement is accurate and not
misleading in any material respect, made all reasonable enquiries of its officers, managers and employees who could reasonably be expected
to have information relevant to matters to which the statement relates.
Notwithstanding anything that may be expressed or implied
in this agreement, the parties acknowledge and agree that no recourse under this agreement shall be had against any person or entity that
is not a party to this agreement, including any past, present or future director, manager, officer, agent, employee, equity holder or
other representative or any affiliate or successor or assignee thereof that is not a party to this agreement (collectively, the “Non-Recourse
Parties”), as such, whether by the enforcement of any assessment or by any legal or equitable proceeding, or by virtue of
any statute, regulation or other applicable Law, it being expressly agreed and acknowledged that no liability whatsoever shall attach
to, be imposed on or otherwise be incurred by any Non-Recourse Party, as such, for any obligation or liability of a party under this agreement
for any claim based on, in respect of or by reason of such obligations or liabilities or their creation.
| 15 | Governing Law, jurisdiction and service of process |
This agreement is governed by the Law in force in Hong
Kong.
Each party submits to the non-exclusive jurisdiction of
the courts in Hong Kong and courts of appeal from them to support and assist the arbitration process referred to in clause 13
(“Dispute Resolution”) including if necessary to grant interlocutory relief pending the outcome of that process.
Without preventing any other method of service, any document
in an Action may be served on a party by being delivered to or left at that party’s address in clause 12.2.
EXECUTED as an agreement
Share
Sale Agreement
Schedule 1 - Shares
| Company |
Class of Shares |
Registered shareholder |
Equity Percentage |
Fully paid? |
| REIT Holdings (China) Limited |
Ordinary shares of HK$1 each |
10,000 shares registered in the name of the Seller |
100% |
Yes |
| (2) | Equity
interest in companies held by the Company for sale |
| No. |
Companies held by the Company |
Equity Percentage |
| 1 |
REIT Ecological Technology Co., Ltd. |
100% |
| 2 |
Beijing REIT Technology Development Co., Ltd. |
100% |
| 3 |
REIT Technology Development Co., Ltd. |
100% |
| 4 |
Hainan Fangyuyuan United Logistics Co., Ltd. |
51% |
| 5 |
Hainan Kunneng Direct Supply Chain Management Co., Ltd. |
26.01% |
| 6 |
Guangling REIT Ecological Cultural Tourism Co., Ltd. |
100% |
| 7 |
Datong Ruisheng Environmental Engineering Co., Ltd. |
100% |
| 8 |
Inner Mongolia REIT Ecological Environment Management Co., Ltd. |
80% |
| 9 |
REIT New Materials Xinyi Co., Ltd. |
100% |
| 10 |
Hainan REIT Mingde Investment Holding Co., Ltd. |
100% |
| 11 |
Hainan Yile IoV Technology Research Institute Co., Ltd. |
90% |
| 12 |
Inner Mongolia Guorui Daojing Information Technology Co., Ltd. |
51% |
| 13 |
Hainan Yile IoT Technology Co., Ltd. |
61.55% |
| 14 |
REIT Q GREEN Machines Private Limited |
51% |
Share
Sale Agreement
Schedule
2 – Warranties
The Company is validly incorporated.
| 1.2 | Compliance with constituent documents and applicable Laws |
The Business and affairs of the Company has at all times
been and continue to be conducted in accordance with their respective memorandum and articles of association and all applicable Laws.
The Shares comprise all of the issued capital of the Company
and are fully paid.
The Seller is the registered and beneficial owner of the
Shares.
There is no restriction on the transfer of the Shares to
the Buyer on the terms of this agreement.
The Seller has, or will have by Completion, obtained all
consents necessary to enable it to transfer the Shares to the Buyer.
The transfer of the Shares does not breach any obligation
or agreement binding on the Seller or the Company.
The Seller has taken all action which is necessary to authorise
the entry into and performance of its obligations under this agreement.
The Seller has the power, without any further consent of
any other person, to enter into and perform its obligations under this agreement.
This agreement constitutes legal, valid and binding obligations
of the Seller, enforceable against it in accordance with its terms.
The execution by the Seller of, and the performance by
the Seller of its obligations under, this agreement does not breach any applicable Law or any Encumbrance or document which is binding
on the Seller and does not result in any material breach or material default under any agreement to which the Company is a party.
Schedule 1 (“Shares”) contains complete, accurate
and up-to-date details of the Shares.
All of the issued shares in the capital of the Company
are validly allotted and issued and were not allotted or issued or transferred in breach of any:
| (a) | pre-emptive or similar rights of any person; or |
| (b) | contract which is binding on the Company. |
All shares in the capital of the Company are fully paid.
The Final Evaluation Report:
| (a) | were prepared in accordance with the requirements of any applicable Laws and in accordance with the standards for valuation of assets;
and |
| (b) | give a true and fair value of the equity interests of the Company as of the Valuation Date. |
The Company is not Insolvent.
The Company has settled all due company registration fee
and company secretary fee in the normal course of operation. There is no pending litigation and arbitration. The Company is able to pay
its debts when they are due to be paid.
Share
Sale Agreement
Signing page
DATED: December 30, 2024
Seller
| SIGNED on behalf of ReTo Eco-Solutions, Inc., a company incorporated in the British Virgin Islands, by Hengfang Li being a person who, in accordance with the laws of that territory, is acting under the authority of the company in the presence of: |
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| /s Guangfeng Dai |
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| Signature of witness |
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| GUANGFENG DAI |
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| Name of witness (block letters) |
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| Room 702, Building X, Runfengdeshang, 60 Anli Road, Chaoyang District, Beijing |
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| Address of witness |
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/s/ Hengfeng Li |
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Buyer
| EXECUTED by ZHAO DUAN WEN |
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| /s/ Zhao Duan Wen |
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| Signature |
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| ZHAO DUAN WEN |
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| Name (block letters) |
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Share Sale Agreement
Annexure A - Final
Evaluation Report
[***]
ReTo Eco Solutions (NASDAQ:RETO)
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ReTo Eco Solutions (NASDAQ:RETO)
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