SMARTHEATINC・SUBSCRIPTIONAGREEMENTSMARTHEATINC•公司【票认购协议ThisSubscriptionAgreementpertainstotheofferingbySmartHeatInc.(the''Company^)ofuptoTwoMillionTwoHundredEightyFiveThousandSevenHundredFourteen(2,285,714)units(the“Units，)witheachUnitconsistingofone(1)shareoftheCompany'scommonstock(the"Shares”)andwarrantstopurchasefifteenpercent(15%)ofone(1)shareoftheCompany，scommonstockatanexercisepriceofSixDollars($6.00)pershare(the"Warrants^),atapurchasepriceofThreeDollarsFiftyCents($3.50)perUnitforanaggregateofferingofaminimumofFiveMillionDollars($5,000,000)anduptoamaximumofEightMillionDollars($8,000,000)(the“Offering")describedinthePrivatePlacementOfferingMemorandumfortheUnitsdatedMay23,2008,asthesameheretomaybeamended(the"OfferingMemorandum”)・TheminimumsubscriptionthattheCompanywillacceptfromanyinvestorisTenThousand(10,000)UnitsforapurchasepriceofThirtyFiveThousandDollars($35,000).TheCompanyismakingthisofferingsolelytoaccreditedinvestors(asdefinedunderRule501(a)ofRegulationDpromulgatedundertheSecuritiesActof1933,asamended(the"SecuritiesAcf)).本协议旨在对SmartHeatInc.公司(以下简称“公司”)发行共计2,285,714单位有价证券(以下简称“发行单位”)的相关事宜进行约定。按照约定，每一发行单位包括一股公司普通股股票(以下简称“发行股票”)及一份权证(该权证的持有人所持有的每一份权证可以6美元的行权价格购买公司15%股的公司普通股股票，以下简称“发行权证”)；此次发行总的融资金额将按照2008年5月23日所签订的《私募发行协议》及其修订协议(以下简称“《发行协议》”)确定，为500万美元至800万美元Z间；此次发行每一投资人应至少认购10000发行单位，相应的最低投资金额为35000美元。Theundersigned,intendingtobelegallybound,herebyofferstopurchasefromtheCompanythenumberofUnitsfortheaggregatepurchasepricesetforthonthesignaturepagehereto・TheCompanywillbedeemedtohaveacceptedthisofferuponexecutionbyitoftheReceiptandAcceptanceattachedtothisSubscriptionAgreement.ThissubscriptionissubmittedtotheCompanysubjecttoitsacceptanceandinaccordancewith,andsubjectto,thetermsandconditionsdescribedin,thisSubscriptionAgreement.1.Definitions.InadditiontothetermsdefinedelsewhereinthisSubscriptionAgreemeforallpurposesofthisSubscriptionAgreement,thefollowingtermsshallhavethemeaningsindicatedinthisSection1:
"Affiliate"meansanyPersonthat,directlyorindirectlythroughoneormoreintermediaries,controlsoriscontrolledbyorisundercommoncontrolwithaPerson,assuchtermsareusedinandconstruedunderRule144."Commission”meanstheSecuritiesandExchangeCommission.“ExchangeAct”meanstheSecuritiesExchangeActof1934,asamended・“GAAP”meansU.S.generallyacceptedaccountingprinciples."Person"meansanindividualorcorporation,partnership,trust,incorporatedorunincorporatedassociation,jointventure,limitedliabilitycompany,jointstockcompany,government(oranagencyorsubdivisionthereof)orotherentityofanykind・"SecuritiesAct"meanstheSecuritiesActof1933,asamended.^TransactionDocuments”meansthisSubscriptionAgreement,theWarrants,theRegistrationRightsAgreementandanyotherdocumentsoragreementsexecutedinconnectionwiththetransactionscontemplatedhereunder.^WarrantShares"meansthesharesofCommonStockissuableuponexerciseoftheWarrants.SuchpurchaseswillbeincludedindeterminingwhethertheminimumamountofthisOfferinghasbeensold.三、认购金额及支付方式此次发行每一认购单位的发行价格为3.5美元，支付方式为支票或者电汇。4.AcceptanceofSubscription.四、认购的接受(a)TheundersignedunderstandsandagreesthattheCompany,initssolediscretion,reservestherighttoacceptorrejectthisoranyothersubscriptionforUnitsinwholeorinpartatanytimepriortotheClosing(asdefinedbelow).(-)投资人知悉并同意，在此次发行完成前，公司有权自行决定接受或拒绝投资人的认购；(b)Intheeventthatthissubscriptionisrejectedinwholeorinpart,theCompanyshallpromptlyreturnallortheapplicableportionofthePurchasePricewithoutinteresttotheundersigned,asthecasemaybe,andthisSubscriptionAgreementshallthereafterhavenoforceoreffectexceptwithrespecttotheportion,ifany,ofthissubscriptionthatisacceptedbythe
Company.(%1)在拒绝投资人认购的情况下，公司应当立即将己经收到认购款返还给投资人。4.RegistrationRights.五、股票注册权ConcurrentlywiththeexecutionofthisSubscriptionAgreementtheCompanyandtheundersignedhaveenteredintoaRegistrationRightsAgreementregardingtheSharesandtheWarrantShares.在签订木协议的同时，公司应当与投资人一并签署一份《股票注册权协议》O5.RestrictionsonResaleorTransfer.六二次出售或转让的限制
(a)TheUnits,Shares,WarrantsandWarrantShareshavenotbeenregisteredundertheSecuritiesActoranystatesecuritieslaws,andmaynotbesoldortransferredunless(i)suchsaleortransferissubsequentlyregisteredthereunder;(ii)theundersignedshallhavedeliveredtotheCompanyanopinionofcounsel(whichopinionandcounselshallbereasonablyacceptabletotheCompany)totheeffectthatthesecuritiestobesoldortransferredmaybesoldortransferredpursuanttoanexemptionfromsuchregistration;or(iii)thesecuritiesaresoldpursuanttoRule144promulgatedundertheSecuritiesAct(orasuccessorrule).(一)此次发行的发行单位、发行股票、发行权证及行权股票在为按照《1933年证券法》或者其他州一级别的证券法律注册Z前，不得再次出售或者转让，除非：(1)己经办理了上述注册，(2)投资人能够向公司提供一份《法律意见书》，证明有关再次出售或转让依法得到豁免，(3)有关再次出售或转让是按照《1933年证券法》的144规则所进行的。(b)Thecertificate(s)representingtheSharesandtheWarrantSharesandtheWarrantsshalleachbearrestrictivelegendsinsubstantiallythefollowingform(andastop-transferordermaybeplacedagainsttransferofthecertificatesforsuchsecurities):"ThesecuritiesrepresentedbythiscertificatehavenotbeenregisteredundertheSecuritiesActof1933，asamended(the'"SecuritiesAct”)，orapplicablestatesecuritieslaws,andaccordinglymaynotbeofferedforsale,soldorotherwisetransferredintheabsenceofaneffectiveregistrationstatementforthesecuritiesundertheSecuritiesActorinatransactionnotsubjecttotheregistrationrequirementsoftheSecuritiesAct,ineachcaseinaccordancewithapplicablestatesecuritieslawsandinthecaseofatransactionexemptfromregistration,theCompanyhasreceivedanopinionofcounsel,inform,substanceandscopereasonablyacceptabletotheCompany,thatregistrationisnotrequiredundertheSecuritiesActandunderallapplicablestatesecuritieslawsorunlesssoldpursuanttoRule144undertheSecuritiesAct】4.DeliveryoftheStockCertificateandWarrants.TheCompanywillexecuteanddelivercertificate(s)representingtheSharesandWarrantstothesubscriberassoonaspracticableaftertheoccurrenceofeachofthefollowingitems:(i)acceptanceofthesubscriptionbytheCompany;(ii)receiptofthePurchasePriceintotheSegregatedAccount;(iii)aclosingoftheOffering;and(iv)releasetotheCompanyofthenetproceedsoftheOfferingfromtheSegregatedAccount.七、股票及权证凭证的交付公司应当在下述条件满足的情况下向投资人签发并交付股票及权证凭证：(一)收到投资人所交纳的认购款；（二）认购款足额支付至专用帐户;
（三）此次发行顺利完成;(%1)公司从专用帐户取得全部发行融资金额。人、股票及权证凭证的交付4.RepresentationsandWarranties.Theundersignedherebyacknowledges,representsandwarrantsto,andagreeswith,theCompanyasfollows:(a)TheundersignedunderstandsthattheofferingandsaleoftheUnitsbytheCompanytotheundersignedisintendedtobeexemptfromregistrationundertheSecuritiesActbyvirtueofSection4(2)oftheSecuritiesActandtheprovisionsofRule506ofRegulationDpromulgatedthereunderand,inaccordancetherewithandinfurtherancethereof,theundersignedrepresentsandwarrantstoandagreeswiththeCompanyasfollows:(i)TheundersignedhascarefullyreviewedtheOfferingMemorandum,thisSubscriptionAgreementandtheConfidentialPurchaserQuestionnaireattachedhereto,theFormofStockPurchaseWarrant,theRegistrationRightsAgreement,andunderstandstheinformationcontainedineachsuchdocumentincluding,butnotlimitedto,theauditedfinancialstatementsasofDecember31,2006and2007andfortheyearsthenendedforTaiyu(asopposedtotheCompany),andthepro-formacombinedbalancesheetoftheCompanyandTaiyuasofDecember31,2007,thepro-formacombinedstatementsofoperationsoftheCompanyandTaiyufortheyearendedDecember31,2007,andtheunauditedfinancialstatementsasofMarch31,2008andforthethreemonthsthenendedincludedintheOfferingMemorandum.(ii)Alldocuments,recordsandbookspertainingtotheCompanyand/orthisinvestmentthattheundersignedhasrequestedhavebeenmadeavailableforinspectionbyhimand/orhisattorney,accountantandotheradvisor(s);(iii)Theundersignedand/orhisadvisor(s)havehadareasonableopportunitytoaskquestionsofandreceiveinformationandanswersfromapersonorpersonsactingonbehalfoftheCompanyconcerningtheofferingoftheUnitsandallsuchquestionshavebeenansweredandallsuchinformationhasbeenprovidedtothefullsatisfactionoftheundersigned;(iv)Neithertheundersignednortheundersigned'sinvestmentadvisors,ifany,havebeenfurnishedanyofferingliteratureotherthantheOfferingMemorandumandtheexhibitsattachedtheretoandtheundersignedandtheundersignecTsadvisors,ifany,havereliedonlyontheinformationcontainedintheOfferingMemorandumandtheexhibitsattachedtheretoandtheinformation,asdescribedinsubparagraphs(ii)and(iii)above,furnishedormadeavailabletothembytheCompany;(v)Nooralorwrittenrepresentationshavebeenmadeandnooralorwritteninformationhasbeenfurnishedtotheundersignedorhisadvisor(s)in
connectionherewiththatwereinanywayinconsistentwiththeinformationsetforthintheOfferingMemorandumandtheexhibitsattachedthereto;(i)TheundersignedisnotsubscribingfortheUnitsasaresultoforsubsequenttoanyadvertisement,article,noticeorothercommunicationpublishedinanynewspaper,magazineorsimilarmediaorbroadcastovertelevisionorradio,orpresentedatanyseminarormeeting;(ii)TheundersignedacknowledgesthathehasconductedhisownindependentevaluationoftheCompanyandhasanalyzedtherisksassociatedwithaninvestmentintheUnitsandhasbasedhisdecisiontoinvestintheUnitsontheresultsofthisevaluationandanalysis;(viii)Theundersigned^overallcommitmenttoinvestmentsthatarenotreadilymarketableisnotdisproportionatetotheundersigned'snetworthandtheundersigned^sinvestmentintheCompanywillnotcausesuchoverallcommitmenttobecomedisproportionatetotheundersigned^networth;(ix)Iftheundersignedisanaturalperson,theundersignedhasreachedtheageofmajorityinthejurisdictioninwhichtheundersignedresides,hasadequatenetworthandmeansofprovidingfortheundersigned^currentfinancialneedsandpersonalcontingencies,isabletobearthesubstantialeconomicrisksofaninvestmentintheUnitsforanindefiniteperiodoftime,hasnoneedforliquidityinsuchinvestmentand,atthepresenttime,couldaffordacompletelossofsuchinvestment;(x)Theaddresssetforthbelowistheundersigned^trueandcorrectresidence(or,ifnotanindividual,domiciliary)address;(xi)Theundersigned(A)hassuchknowledgeof,andexperiencein,businessandfinancialmatterssoastoenablehimtoutilizetheinformationmadeavailabletohiminconnectionwiththeofferingoftheUnitsinordertoevaluatethemeritsandrisksofaninvestmentintheUnitsandtomakeaninformedinvestmentdecisionwithrespectthereto,(B)theundersignedhascarefullyevaluatedtherisksofinvestingand(C)hasthecapacity,eitheralone,orwithaprofessionaladvisor,toprotecthisowninterestsinconnectionwithapurchaseoftheUnits;(xii)TheundersignedisnotrelyingontheCompanywithrespecttotheeconomicconsiderationsoftheundersignedrelatingtothisinvestment.Inregardtosuchconsiderations,theinvestorhasreliedontheadviceof,orhasconsultedwith,onlyhisownadvisor(s).TheundersignedrecognizesthattheinformationfurnishedbytheCompanydoesnotconstituteinvestment,accounting,legalortaxadvice.Theundersignedisrelyingonprofessionaladvisorsforsuchadvice;(xiii)TheundersignedisacquiringtheUnitssolelyforhisownaccountasprincipal,forinvestmentpurposesonlyandnotwithaviewtotheresaleordistributionthereof,inwholeorinpart,andnootherpersonhasadirectorindirectbeneficialinterestinsuchUnits;
(xiv)Theundersignedunderstandsthatthecertificate(s)evidencingownershipoftheSharesandtheWarrantSharesandtheWarrantswilleachbeararestrictivelegendandhavenotbeenregisteredundertheSecuritiesActoranystatesecuritieslaws,andmaynotbesoldortransferredunless(i)suchsaleortransferissubsequentlyregisteredthereunder;(ii)theundersignedshallhavedeliveredtotheCompanyanopinionofcounsel(whichopinionandcounselshallbereasonablyacceptabletotheCompany)totheeffectthatthesecuritiestobesoldortransferredmaybesoldortransferredpursuanttoanexemptionfromsuchregistration;or(iii)thesecuritiesaresoldpursuanttoRule144promulgatedundertheSecuritiesAct(orasuccessorrule);(xv)TheundersignedunderstandsthatthepriceoftheUnitshasbeendeterminedarbitrarilybytheCompanyandmaynotbeindicativeofthetruevalueoftheUnits.TheundersignedunderstandsthatnoassurancescanbegiventhattheShares,theWarrantsortheWarrantSharescouldberesoldbytheSubscriberforthesubscriptionpriceoranypriceandhe/she/ithasmadeanindependentdeterminationofthefairnessofthesubscriptionprice;and(xvi)TheundersignedacknowledgesthattheinformationfurnishedbytheCompanyorthePlacementAgenttotheundersignedoritsadvisorsinconnectionwiththisOfferingisconfidentialandnonpublicandagreesthatallsuchinformationwhichismaterialandnotyetpubliclydisseminatedbytheCompanyshallbekeptinconfidencebytheundersignedandneitherusedbytheundersignedfortheundersigned^personalbenefit(otherthaninconnectionwiththisSubscription),nordisclosedtoanythirdparty,excepttheundersigned'slegalandotheradvisorswhoshallbeadvisedoftheconfidentialnatureofsuchinformation,foranyreason;provided,thatthisobligationshallnotapplytoanysuchinformationthat(i)ispartofthepublicknowledgeorliteratureandreadilyaccessibleatthedatehereof,(ii)becomesapartofthepublicknowledgeorliteratureandreadilyaccessiblebypublication(exceptasaresultofabreachofthisprovision)or(iii)isreceivedfromthirdparties(exceptforthirdpartieswhodisclosesuchinformationinviolationofanyconfidentialityobligation).(xvii)IftheundersignedisanemployeebenefitplanwithinthemeaningoftheEmployeeRetirementIncomeSecurityActof1974,asamended(“ERISA”)：(a)Theundersignedanditsplanfiduciariesarenotaffiliatedwith,andareindependentof,theCompany,andareinformedofandunderstandtheCompany'sinvestmentobjectives,policiesandstrategies.(b)TheundersignedrepresentsthatthepurchaseoftheUnitswillnotinvolveanytransactionthatissubjecttotheprohibitionofSection406ofERISAorinconnectionwithwhichapenaltycouldbeimposedunderSection502(i)ofERISAorataxcouldbeimposedpursuanttoSection4975oftheInternalRevenueCodeof1986,asamended・
(a)Thetrusteeorotherplanfiduciarydirectingtheinvestment:(i)inmakingtheproposedinvestment,isawareofandhastakenintoconsiderationthediversificationrequirementsofSection404(a)(l)(C)ofERISA;and(ii)hasconcludedthattheproposedinvestmentintheCompanyisprudentandisconsistentwiththeotherapplicablefiduciaryresponsibilitiesunderERISA・(b)ThisAgreementhasbeendulyexecutedontheundersigned'sbehalfbyadulydesignatedNamedFiduciary(withinthemeaningofSection402(a)(2)ofERISA).(c)Iftheundersignedisanindividualretirementaccount(IRA)oremployeebenefitplannotsubjecttoTitleIofERISA,suchasagovernmentalorchurchplan,theowneroftheindividualretirementaccountorotherfiduciarydirectingtheinvestmentoftheplanhasconcludedthattheproposedinvestmentintheUnitsisprudentandconsistentwithitsfiduciaryresponsibilities,ifany.(xviii)TheundersignedhascompletedandreturnedtotheCompanyaPurchaserQuestionnaire,intheformattachedashereto.TheinformationprovidedbytheundersignedinthePurchaserQuestionnaireistrueandcorrectandtheundersignedunderstandsthattheCompanyisrelyinguponsuchinformationinconnectionwiththepurchaseoftheUnitsbytheundersigned・(a)TheundersignedrecognizesthataninvestmentintheUnitsinvolvesanumberofsignificantrisksincluding,butnotlimitedto,thoseriskssetforthunderthe"RiskFactors^intheOfferingMemorandum・(b)TheundersignedunderstandsthatnofederalorstateagencyhaspassedupontheUnitsormadeanyfindingordeterminationastothefairnessofthisinvestmentintheUnits.(c)AllinformationthattheundersignedhasheretoforefurnishedandfurnishesherewithtotheCompanyaretrue,correctandcompleteasofthedateofexecutionofthisSubscriptionAgreementand讦thereshouldbeanymaterialchangeinsuchinformationpriortotheclosingofthesaleoftheUnits(the"Closing")，theundersignedwillimmediatelyfurnishsuchrevisedorcorrectedinformationtotheCompany.(d)TheundersignedcertifiesthatitisNOT(1)anon-residentalienor(2)aforeigncorporation,foreignpartnership,foreigntrustorforeignestate(asthosetermsaredefinedintheInternalRevenueCodeof1986,asamended,includingincometaxregulations(the"Code”))forpurposesofU.S.Federalincometaxation.TheundersignedagreestonotifytheCompanywithin60daysofthedateitbecomesaforeignpersonorentity.TheUndersignedfurthercertifiesthatitsname,U.S.taxidentificationnumberhomeaddress(inthecaseofanindividual)andbusinessaddress(inthecaseofanentity),asappearinthisAgreementaretrueandcorrect.Theundersigned
furthercertifiesthatitisNOTsubjecttobackupwithholdingbecauseeither(1)itisexemptfrombackupwithholding,(2)ithasnotbeennotifiedbytheInternalRevenueService(nIRSH)thatitissubjecttobackupwithholdingasaresultofafailuretoreportallinterestordividends,or(3)theIRShasnotifieditthatitisnolongersubjecttobackupwithholding.Theundersignedunderstandsthatthesecertifications,whicharemadeunderpenaltyofpetjury,maybedisclosedtotheIRSbytheCompanyandthatanyfalsestatementscontainedinthisparagraphcouldbepunishedbyfineand/orimprisonmen匚(a)Theundersignedrepresentsthatneitheritnor,toitsknowledge,anypersonorentitycontrolling,controlledbyorundercommoncontrolwiththeundersignednoranypersonorentityhavingabeneficialinterestintheundersignednoranyotherpersonorentityonwhosebehalftheundersignedisacting(1)isapersonorentitylistedintheannextoExecutiveOrderNo.13224(2001)issuedbythePresidentoftheUnitedStates(ExecutiveOrderBlockingPropertyandProhibitingTransactionswithPersonsWhoCommit,ThreatentoCommit,orSupportTerrorism),(2)isnamedontheListofSpeciallyDesignatedNationalsandBlockedPersonsmaintainedbytheU.S.OfficeofForeignAssetsControl(OFAC),(3)isanon-U.S.shellbankorisprovidingbankingservicesindirectlytoanon-U.S.shellbank,(4)isaseniornon-U.S.politicalfigureoranimmediatefamilymemberorcloseassociateofsuchfigure,or(5)isotherwiseprohibitedfrominvestingintheCompanypursuanttoapplicableU.S.anti-moneylaundering,antiterroristandassetcontrollaws,regulations,rulesororders(categories(1)through(5)collectively,aHProhibitedInvestor11)・TheUndersignedagreestoprovidetheCompany,promptlyuponrequest,allinformationthattheCompanyreasonablydeemsnecessaryorappropriatetocomplywithapplicableU.S.anti-moneylaundering,antiterroristandassetcontrollaws,regulations,rulesandorders.TheundersignedconsentstothedisclosuretoU.S.regulatorsandlawenforcementauthoritiesbytheCompanyanditsaffiliatesandagentsofsuchinformationabouttheundersignedastheCompanyreasonablydeemsnecessaryorappropriatetocomplywithapplicableU.S.anti-moneylaundering,antiterroristandassetcontrollaws,regulations,rulesandorders.IftheundersignedisafinancialinstitutionthatissubjecttothePATRIOTAct,PublicLawNo.107-56(Oct.26,2001)(theHPatriotAct”)，theundersignedrepresentsthattheundersignedhasmetallofitsrespectiveobligationsunderthePatriotAct.Theundersignedacknowledgesthatif,followingtheinvestmentintheCompanybytheundersigned,theCompanyreasonablybelievesthattheundersignedisaProhibitedInvestororisotherwiseengagedinsuspiciousactivityorrefusestoprovidepromptlyinformationthattheCompanyrequests,theCompanyhastherightormaybeobligatedtoprohibitadditionalinvestments,segregatetheassetsconstitutingtheinvestmentinaccordancewithapplicableregulationsorimmediatelyrequiretheundersignedtotransfertheShares.TheundersignedfurtheracknowledgesthattheundersignedwillnothaveanyclaimagainsttheCompanyoranyofitsaffiliatesoragentsforanyformofdamagesasaresultofanyoftheforegoingactions.g)公司将按照所受到认购总价的8%向合格经纪人或券商支付交易佣金。(b)TheundersignedacknowledgesandagreesthattheCompanyintendstopaycommissionstoanyregisteredbroker/dealerorfinderdesignatedaselecteddealeronallsalestoqualifiedaccreditedinvestorsthatitreferstotheCompany.Thesecommissionswillconsistofcashequaltoeightpercent(8%)ofthegrossproceedsreceivedbytheCompanyfromsuchsales.h)此协议中的投资人应该按照协议要求，在规定期限内，将木协议、承诺、保证、及付款证明以书面形式告知公司。
(a)Theforegoingrepresentations,warrantiesandagreements,togetherwithallotherrepresentationsandwarrantiesmadeorgivenbytheundersignedtotheCompanyinanyotherwrittenstatementordocumentdeliveredinconnectionwiththetransactionscontemplatedhereby,shallbetrueandcorrectinallrespectsonandasofthedateoftheClosingasifmadeonandasofsuchdateandshallsurvivesuchdate.IfmorethanonepersonissigningthisSubscriptionAgreement,eachrepresentation,warrantyandundertakinghereinshallbethejointandseveralrepresentation,warrantyandundertakingofeachsuchperson.九、公司的承诺和保证4.RepresentationsandWarrantiesoftheCompany.TheCompanyherebyacknowledges,representsandwarrantsto,andagreeswith,theundersignedasfollows:a)组织机构和资格能力本公司的各项组织运营均符合法律要求，并11合法经营，也未涉及任何违法事件。(a)OrganizationandQualification.TheCompanyisdulyincorporatedorotherwiseorganized,validlyexistingandingoodstandingunderthelawsofthejurisdictionofitsincorporationororganization,withtherequisitepowerandauthoritytoownanduseitspropertiesandassetsandtocarryonitsbusinessascurrentlyconducted・TheCompanyisnotinviolationofanyoftheprovisionsofitscertificateorarticlesofincorporation,bylawsorotherorganizationalorcharterdocuments.TheCompanyisdulyqualifiedtoconductitsbusinessandisingoodstandingasaforeigncorporationorotherentityineachjurisdictioninwhichthenatureofthebusinessconductedorpropertyownedbyitmakessuchqualificationnecessary.b)授权与执行本公司有能力及权利完成协议中所述的交易文件。(b)Authorization;Enforcement.TheCompanyhastherequisitecorporatepowerandauthoritytoenterintoandtoconsummatethetransactionscontemplatedbyeachoftheTransactionDocumentsandotherwisetocarryoutitsobligationsthereunder.TheexecutionanddeliveryofeachoftheTransactionDocumentsbytheCompanyandtheconsummationbyitofthetransactionscontemplatedtherebyhavebeendulyauthorizedbyallnecessaryactiononthepartoftheCompanyandnofurtheractionisrequiredbytheCompanyinconnectiontherewith.EachTransactionDocumenthasbeen(orupondeliverywillhavebeen)dulyexecutedbytheCompanyand,whendeliveredinaccordancewiththetermshereof,willconstitutethevalidandbindingobligationoftheCompanyenforceableagainsttheCompanyinaccordancewithitsterms,exceptassuchenforceabilitymaybelimitedbyapplicablebankruptcy,insolvency,reorganization,moratorium,liquidationorsimilarlawsrelatingto,oraffectinggenerallytheenforcementof,creditors'rightsandremediesorbyotherequitableprinciplesofgeneralapplication.c)没有分歧本协议中公司对交易文件的完成、递交、及履行以及对预期交易的完成将不会也不包括1)与公司章程、组织宪章、各项规则不起冲突，也不违背2)导致公司违背任何的法律、法规、规定、要求、判断、或法令，也不会影响到公司的财产或资产。(c)NoConflicts.Theexecution,deliveryandperformanceoftheTransactionDocumentsbytheCompanyandtheconsummationbytheCompanyofthetransactions
contemplatedtherebydonotandwillnot(i)conflictwithorviolateanyprovisionoftheCompany'scertificateorarticlesofincorporation,bylawsorotherorganizationalorcharterdocuments,or(ii)conflictwith,orconstituteadefault(oraneventthatwithnoticeorlapseoftimeorbothwouldbecomeadefault)under,orgivetoothersanyrightsoftermination,amendment,accelerationorcancellation(withorwithoutnotice,lapseoftimeorboth)of,anyagreement,creditfacility,debtorotherinstrument(evidencingaCompanydebtorotherwise)orotherunderstandingtowhichtheCompanyisapartyorbywhichanypropertyorassetoftheCompanyisboundoraffected,or(iii)resultinaviolationofanylaw,rule,regulation,order,judgment,injunction,decreeorotherrestrictionofanycourtorgovernmentalauthoritytowhichtheCompanyissubject(includingfederalandstatesecuritieslawsandregulations),orbywhichanypropertyorassetoftheCompanyisboundoraffected.a)呈报，同意，及批准本公司没有义务就于本协议中交易文件的完成、递交、及履行中涉及到的同意、放弃、授权、通知、呈报、及注册，向任何法院、联邦政府、州政府、地方政府、驻外办、或其他个人进行告知，除非：1)按照州证券法必须呈报2)符合证券交易法条款D内容(a)Filings，ConsentsandApprovals.TheCompanyisnotrequiredtoobtainanyconsent,waiver,authorizationororderof,giveanynoticeto,ormakeanyfilingorregistrationwith,anycourtorotherfederal,state,local,foreignorothergovernmentalauthorityorotherPersoninconnectionwiththeexecution,deliveryandperformancebytheCompanyoftheTransactionDocuments,otherthan(i)thefilingwiththeCommissionofoneormoreRegistrationStatementsinaccordancewiththerequirementsoftheRegistrationRightsAgreement,(ii)filingsrequiredbystatesecuritieslaws,(iii)thefilingofaNoticeofSaleofSecuritiesonFormDwiththeCommissionunderRegulationDoftheSecuritiesAct,and(iv)thosethathavebeenmadeorobtainedpriortothedateofthisSubscriptionAgreement.b)股票发行本公司将按照本协议屮交易文件屮的认股份额向投资人发行股票，所有股票除投资额外免除任何费用，也没有留置权及其他阻碍问题。(b)IssuanceoftheUnits.TheUnitshavebeendulyauthorizedand,whenissuedandpaidforinaccordancewiththeTransactionDocuments,willbedulyandvalidlyissued,fullypaidandnonassessable,freeandclearofallliensandencumbrances.TheCompanyhasreservedfromitsdulyauthorizedcapitalstockthesharesofCommonStockissuablepursuanttothisAgreementandtheWarrantsinordertoissuetheSharesandtheWarrantShares.十、投资人注意事项4.NoticetotheUndersigned.THEUNITSHAVENOTBEENREGISTEREDUNDERTHESECURITIESACTORTHESECURITIESLAWSOFANYSTATEANDAREBEINGOFFEREDANDSOLDINRELIANCEONEXEMPTIONSFROMTHEREGISTRATIONREQUIREMENTSOFTHESECURITIESACTANDSUCHLAWS.THEUNITSHAVENOTBEENAPPROVEDORDISAPPROVEDBYTHECOMMISSION,ANYSTATESECURITIESCOMMISSIONOROTHERREGULATORYAUTHORITY,NORHAVEANYOFTHEFOREGOINGAUTHORITIESPASSEDUPONORENDORSEDTHE
MERITSOFTHISOFFERINGORTHEACCURACYORADEQUACYOFTHEOFFERINGMEMORANDUM.ANYREPRESENTATIONTOTHECONTRARYISUNLAWFUL.THEUNITSARESUBJECTTORESTRICTIONSONTRANSFERABILITYANDRESALEANDMAYNOTBETRANSFERREDORRESOLDEXCEPTASPERMITTEDUNDERTHESECURITIESACT,ANDAPPLICABLESTATESECURITIESLAWS,PURSUANTTOREGISTRATIONOREXEMPTIONTHEREFROM.SUBSCRIBERSSHOULDBEAWARETHATTHEYMAYBEREQUIREDTOBEARTHEFINANCIALRISKSOFTHISINVESTMENTFORANINDEFINITEPERIODOFTIME.THESALEOFTHESECURITIESTHATARETHESUBJECTOFTHISOFFERINGHASNOTBEENQUALIFIEDWITHTHECOMMISSIONEROFCORPORATIONSOFTHESTATEOFCALIFORNIAANDTHEISSUANCEOFSUCHSECURITESORTHEPAYMENTORRECEIPTOFANYPARTOFTHECONSIDERATIONFORSUCHSECURITIESPRIORTOSUCHQUALIFICATIONISUNLAWFUL,UNLESSTHESALEOFTHESECURITIESISEXEMPTFROMQUALIFICATIONBYSECTION25000,25102OR25105OFTHECALIFORNIACORPORATIONSCODE.THERIGHTSOFALLPARTIESAREEXPRESSLYCONDITIONEDUPONSUCHQUALIFICATIONBEINGOBTAINED,UNLESSTHESALEISSOEXEMPT.FORFLORIDARESIDENTSONLY:THEUNITSREFERREDTOHEREINWILLBESOLDTO,ANDACQUIREDBY,THEHOLDERINATRANSACTIONEXEMPTUNDER§517.061OFTHEFLORIDASECURITIESACT.THEUNITSHAVENOTBEENREGISTEREDUNDERSAIDACTINTHESTATEOFFLORIDA.INADDITION,ALLFLORIDARESIDENTSSHALLHAVETHEPRIVILEGEOFVOIDINGTHEPURCHASEWITHINTHREE(3)DAYSAFTERTHEFIRSTTENDEROFCONSIDERATIONISMADEBYSUCHPURCHASERTOTHECOMPANY,ANAGENTOFTHECOMPANY,ORANESCROWAGENTORWITHINTHREEDAYSAFTERTHEAVAILABILITYOFTHATPRIVILEGEISCOMMUNICATEDTOSUCHPURCHASER,WHICHEVEROCCURSLATER.FORCALIFORNIARESIDENTSONLY:THESALEOFTHESECURITIESTHATARETHESUBJECTOFTHISOFFERINGHASNOTBEENQUALIFIEDWITHTHECOMMISSIONEROFCORPORATIONSOFTHESTATEOFCALIFORNIAANDTHEISSUANCEOFSUCHSECURITIESORTHEPAYMENTORRECEIPTOFANYPARTOFTHECONSIDERATIONFORSUCHSECURITIESPRIORTOSUCHQUALIFICATIONISUNLAWFUL,UNLESSTHESALEOFTHESECURITIESISEXEMPTFROMQUALIFICATIONBYSECTION25000,25102OR25105OFTHECALIFORNIACORPORATIONSCODE.THERIGHTSOFALLPARTIESAREEXPRESSLYCONDITIONEDUPONSUCHQUALIFICATIONBEINGOBTAINED,UNLESSTHESALEISSOEXEMPT.FORNEWHAMPSHIRERESIDENTSONLY:NEITHERTHEFACTTHATAREGISTRATIONSTATEMENTORANAPPLICATIONFORALICENSEHASBEENFILEDWITHTHESTATEOFNEWHAMPSHIRENORTHEFACTTHATASECURITYISEFFECTIVELYREGISTEREDORAPERSONISLICENSEDINTHESTATEOFNEWHAMPSHIRECONSTITUTESAFINDINGBYTHENEWHAMPSHIRESECRETARYOF
STATETHATANYDOCUMENTHLEDUNDERNEWHAMPSHIRERSA421-BISTRUE.COMPLETEANDNOTMISLEADING.NEITHERANYSUCHFACTNORTHEFACTTHATANEXEMPTIONOREXCEPTIONISAVAILABLEFORASECURITYORATRANSACTIONMEANSTHATTHENEWHAMPSHIRESECRETARYOFSTATEHASPASSEDINANYWAYUPONTHEMERITSORQUALIFICATIONSOF,ORRECOMMENDEDORGIVENAPPROVALTO,ANYPERSON,SECURITY,ORTRANSACTION.ITISUNLAWFULTOMAKE、ORCAUSETOBEMADE,TOANYPROSPECTIVEPURCHASER,CUSTOMER,ORCLIENTANYREPRESENTATIONINCONSISTENTWITHTHEPROVISIONSOFTHISPARAGRAPH.4.赔偿11.Indemnification.TheundersignedagreestoindemnifyandholdharmlesstheCompanyandtheofficersanddirectorsthereofandeachotherperson,ifany,whocontrolstheCompany,withinthemeaningofSection15oftheSecuritiesAct,againstanyandallloss,liability,claim,damageandexpensewhatsoever(including,butnotlimitedto,anyandallexpensesreasonablyincurredininvestigating,preparingordefendingagainstanylitigationcommencedorthreatenedoranyclaimwhatsoever)arisingoutoforbaseduponanyfalserepresentationsorwarrantyorbreachorfailurebytheundersignedtocomplywithanycovenantoragreementmadebytheundersignedhereinorinanyotherdocumentfurnishedbytheundersignedtotheCompanyinconnectionwiththistransaction.12.附加说明投资人应该知晓并且同意本公司就投资人作为投资人这一事实，在未來的时间对投资人的有关信息进行进一步了解。5.AdditionalInformation.TheundersignedherebyacknowledgesandagreesthattheCompanymaymakeorcausetobemadesuchfurtherinquiryandobtainsuchadditionalinformationasitmaydeemappropriatewithregardtothesuitabilityoftheundersignedasaninvestorintheUnits.6.绑定效应投资人应该知哓并IL同意，除了符合特定的州证券法律，本协议一经签署，无法撤回；同时投资人没有资格取消或终止木协议13.BindingEffect.Theundersignedherebyacknowledgesandagreesthat,exceptasprovidedunderapplicablestatesecuritieslaws,thesubscriptionhereunderisirrevocable,thattheundersignedisnotentitledtocancel,terminateorrevokethisSubscriptionAgreementoranyagreementsoftheundersignedhereunderandthatthisSubscriptionAgreementandsuchotheragreementsshallsurvivethedeathordisabilityoftheundersignedandshallbebindinguponandinuretothebenefitofthepartiesandtheirheirs,executors,administrators,successors,legalrepresentativesandassigns.Iftheundersignedismorethanoneperson,theobligationsoftheundersignedhereundershallbejointandseveralandtheagreements,representations,warrantiesandacknowledgmentshereincontainedshallbedeemedtobemadebyandbebindinguponeachsuchpersonandhis/her/itsheirs,executors,administrators,successors,legalrepresentativesandassigns.ThisSubscriptionAgreementshallspecificallyinuretothebenefitofeachofficeranddirectoroftheCompany,irrespectiveofthefactthatoneormoreofthemarenotpartiestothisSubscriptionAgreement.
11.协议修改除非有特殊要求，本协议中的内容将不做任何修改（包括对条款的放弃、修订、终止）。4.Modification.NeitherthisSubscriptionAgreementnoranyprovisionshereofshallbewaived,modified,dischargedorterminatedexceptbyaninstrumentinwritingsignedbythepartyagainstwhomanysuchwaiver,modification,dischargeorterminationissought.5.通知投资人需要了解的通知、通告将通过下方式得到1）以在美国进内的预付款信件形式送到2）公司派人员亲自送达12.Notices.Anynotice,demandorothercommunicationthatanypartyheretomayberequired,ormayelect,togivetoanyotherpartyhereundershallbesufficientlygivenif（a）deposited,postageprepaid,inaUnitedStatesmailbox,stamped,registeredorcertifiedmail,returnreceiptrequested,addressedtosuchaddressasmaybelistedonthebooksoftheCompany,or（b）deliveredpersonallyatsuchaddress.13.协议副本协议副本（包括传真件）与正本具有相同法律效应。6.Counterparts.ThisSubscriptionAgreementmaybeexecutedthroughtheuseofseparatesignaturepagesorinanynumberofcounterparts,andeachofsuchcounterpartsshall,forallpurposes,constituteoneagreementbindingonallparties,notwithstandingthatallpartiesarenotsignatoriestothesamecounterpart.ThisSubscriptionAgreementmaybeexecutedanddeliveredviaelectronicfacsimiletransmissionwiththesameforceandeffectasifitwereexecutedanddeliveredbythepartiessimultaneouslyinthepresenceofoneanother・7.协议完整性本协议为股票认购协议的完全内容。14.EntireAgreement.ThisSubscriptionAgreementcontainstheentireagreementofthepartieswithrespecttothesubjectmatterhereofandtherearenorepresentations,covenantsorotheragreementsexceptasstatedorreferredtoherein.15.屮止协议本协议的每项条款均可被单独中止，但不影响整个协议的有效性。8.Severability・EachprovisionofthisSubscriptionAgreementisintendedtobeseverablefromeveryotherprovision,andtheinvalidityorillegalityofanyprovisionshallnotaffectthevalidityorlegalityoftheremainingprovisions.9.转让协议投资人无权转让木认购协议。16.Assignability.ThisSubscriptionAgreementisnottransferableorassignablebytheundersigned.17.适用的法律
本协议的所有内容均符合并1L遵守宾夕法尼亚联邦法。4.ApplicableLaw・ThisSubscriptionAgreementshallbegovernedbyandconstruedinaccordancewiththelawsoftheCommonwealthofPennsylvaniaasappliedtoresidentsofthatjurisdictionexecutingcontractswhollytobeperformedtherein・5.管辖权选择投资人知晓并IL同意就任何直接或间接超出本协议内容的行为、任何违约行为、任何其他行为向宾夕法尼亚联邦政府申请仲裁。11.ChoiceofJurisdiction.TheundersignedagreesthatanyactionorproceedingdirectlyorindirectlyrelatingtoorarisingoutofthisSubscriptionAgreement,anybreachhereof,oranytransactioncoveredherebyshallberesolved,whetherbyarbitrationorotherwise,withintheCommonwealthofPennsylvania・Accordingly,thepartiesconsentandsubmittothejurisdictionofthestatecourtsoftheCommonwealthofPennsylvanialocatedwithinPhiladelphia,PennsylvaniaortheUnitedStatesfederalcourtslocatedintheEasternDistrictofPennsylvania.ThepartiesfurtheragreethatanysuchreliefwhatsoeverinconnectionwiththisSubscriptionAgreementshallbecommencedbysuchpartyexclusivelyinthestatecourtsoftheCommonwealthofPennsylvanialocatedwithinPhiladelphia,PennsylvaniaortheUnitedStatesfederalcourtslocatedintheEasternDistrictofPennsylvania.12.补偿如果本协议中的任何款项在履行途中遇到任何的争辩、违约、或不履行责任，经仲裁后，胜诉的那一方无须支付律师费，及涉及的诉讼费。6.Reimbursement.IfanyactionorotherproceedingisbroughtfortheenforcementofthisSubscriptionAgreementorbecauseofanallegeddispute,breach,defaultormisrepresentationinconnectionwithanyoftheprovisionsofthisSubscriptionAgreement,thesuccessfulorprevailingpartyorpartiesshallbeentitledtorecoverreasonableattorney，sfeesandothercostsincurredinsuchactionorproceedinginadditiontoanyotherrelieftowhichtheymaybeentitled.7.可追就性协议双方需签署本协议中的各项文件，使其生效。13.FurtherAssurances.Eachofthepartiesshallexecutesaiddocumentsandotherinstrumentsandtakesuchfurtheractionsasmaybereasonablyrequiredordesirabletocarryouttheprovisionshereofandthetransactionscontemplatedhereby.
SubscriptionInformation(tobecompletedbyindividualsubscriber):认购方信息(以下内容由认购方填写)UnitsPurchased认0划数量PurchasePriceofUnits(NumberofUnitsPurchasedx$3.50perUnit)认购金额(认购股数乘以每股$3.50的价格)Name(s)inwhichtheUnitsistoberegistered:股栗拥有者HomeAddress家庭住址MailingAddress:邮件地址以下内容由股票共同拥有着签署Formofjointownership(ifapplicable).(Ifoneoftheseitemsischecked,subscriberandco-subscribermustbothsignalldocuments.):Tenants-in-CommonJointTenants以资证明本认购协议在2008年7月26日生效。INWITNESSWHEREOF,theundersignedhascausedthisSubscriptionAgreementtobedulyexecutedonthe_26n,_dayof_June,2008.PleasePrintNameofSubscriber投资人正楷姓名SignatureofSubscriber投资人签名SocialSecurityNumber证件号PleasePrintNameofCo-SubscriberSignatureofCo-SubscriberSocialSecurityNumber[ATTACHCHECKHERE]
THISPORTIONNOTTOBECOMPLETEDBYSUBSCRIBERRECEIPTANDACCEPTANCECASHORCHECKANDSUBSCRIPTIONAGREEMENTRECEIVEDON,2008.By:SUBSCRIPTIONACCEPTEDON,2008.SMARTHEATINC.By:Name:Title:WIRETRANSFERINSTRUCTIONSIfSubscriberwishestowiretransferthepurchasepriceofhisUnits,heorsheshallwiretransferimmediatelyavailablefundsintheamountofthePurchasePricesubscribedforhereunder,asfollows:Bank:CommerceBank,N.A.AccountName:SmartHeatInc.OfferingEscrowAccountAccountNo•:373318732BankRoutingNo.:036001808SwiftCode:(a)CBNAUS332.VerificationofInvestorSuitabilityunderRegulationD.TheundersignedunderstandsthatinordertosubscribefortheUnitsinthisOffering,theundersignedmustbean''accreditedinvestor55asdefinedinSection501ofRegulationDundertheSecuritiesActandtheundersignedherebyrepresentsandwarrantsthatitisan^accreditedinvestor23*****9'assuchitemisdefinedinRule501(a)promulgatedundertheSecuritiesAct.Furthermore,theCompanyunderstandsthat,asaconditiontotheCompany'sacceptanceofthissubscription,theundersignedmustcompleteaPurchaserQuestionnaireintheformattachedhereto.
二合格投资者身份声明3.AmountandMethodofPayment.ThepurchasepricefortheUnitsisThreeDollarsFiftyCents($3.50)perUnitandshallbepaidbytenderofacheckmadepayabletoSmartHeatInc.orwiretransferofimmediatelyavailablefundstothespecialsegregatedaccountsetforthonthelastpagehereof(the^SegregatedAccount”)intheamountofThreeDollarsFiftyCents($3.50)perUnitmultipliedbythenumberofUnitspurchasedbytheundersignedassetforthonthesignaturepagehereof(the“PurchasePrice").AllproceedsofthisOfferingwillbedepositedintheSegregatedAccountandwillnotbereleasedtotheCompanyuntilgrossproceedsofatleastFiveMillionDollars($5,000,000)havebeendepositedintotheSegregatedAccount.IfthisamountisnotreceivedbeforeJuly31,2008,assuchdatemaybeextendedasprovidedintheOfferingMemorandum,thenthePurchasePriceshallbereturnedtotheundersignedinfullwithoutinterestunlesstheCompanydetermines,initssolediscretion,toextendtheofferingperiod・AffiliatesofplacementagentsandtheCompanymaypurchaseUnitsfortheirownaccount.
