FORM OF SERIES A TERM SHEETEN.docx

1、FORM OF SERIES A TERM SHEETENFORM OF SERIES A TERM SHEET-ENOffering TermsCompanyInvestor and/or its affiliates.FoundersInvestmentAmountUS$ in totalInvestmentStructure;SecuritiesThe Investor will purchase certain number of Series A Preferred Shares newly issued by the Company that represent % of the

2、share capital of the Company on a fully-diluted and as-converted basis immediately following the consummation of the transaction contemplated hereby.ValuationA fully-diluted pre-money valuation of US$ (including any and all shares reserved under the Companys employee stock option plan) and a fully-d

3、iluted post-money valuation of $ . The capitalization table of the Company is set forth on Schedule II attached hereto.Bridge LoanLoan AmountThe Investor will purchase certain convertible promissory note (the “Note”) with an aggregate principal amount of US$ .Terms of NoteThe key terms of each Note

4、are as follows:1.Maturity date: months after the closing of the Note financing (the “Note Closing”);2.Interest: simple interest of % per annum (zero interest if the Note is converted into Series A Preferred Shares); interest increased to % per annum upon occurrence of an event of default;3.No prepay

5、ment is allowed;4.Security: pledge of no less than % equity interest held by the Founders in the Company and the Domestic Company; Founders and the Company shall be jointly and severally liable for the obligations under the Note;5.Conversion: Each holder of the Note shall have the right (but not the

6、 obligation) to convert all (or any part of) of the outstanding principal amount of the Note (and, if so elected by such holder, any interest accrued thereon) into Series A Preferred Shares upon the Closing at a per share conversion price equal to (i) % of the per share purchase price for the Series

7、 A Preferred Shares (the “Per Share Price”) if the Closing is consummated within days of the Note Closing, or (ii) % of the Per Share Price if the Closing is consummated upon or after days of the Note Closing;6.Customary events of default including customary cross default provisions.Shares Purchase

8、AgreementRepresentation and WarrantieThe Group Companies and the Founders will make customary representations, warranties, covenants and indemnifications on a joint and several basis.Use ofProceedsThe proceeds will be used for product research and development, business expansion, and working capital

9、 and other purposes as agreed by the Investor.ClosingConditions1.Establishment of an appropriate legal and business structure acceptable to the Investor for the Companys operations, including (i) the execution of a set of customary Control Documents (as defined below) and (ii) the designation of an

10、Investor nominee to hold up to % equity interest in the Domestic Company;2.Execution of labor contract, invention assignment, confidentiality, non-compete and non-solicitation agreement by the Founders and Key Employees as agreed by the Investor with the applicable Group Company;3.Execution of direc

11、tor indemnification agreement between the Company and the director appointed by the Investor (the “Investor Director”);4.Execution of a customary management rights letter in favour of the Investor;5.Approval of transaction by the Investors investment committee;6.Completion of business, finance, and

12、legal due diligence by the Investor and its advisors to their satisfaction;7.All necessary approvals and consents having been obtained from existing shareholders, parties and relevant government authorities;8.Issuance of relevant legal opinions;9.No material adverse effect;10.Submission of a detaile

13、d business plan and budget for the twelve months following the Closing which is acceptable to the Investor;11.Execution of relevant transaction documents (including without limitation Shareholders Agreement, Memorandum and Articles and Share Restriction Agreement etc.) and satisfaction of conditions

14、 precedent contained therein;12.Representations and warranties of the Group Companies and the Founders being true, accurate and complete as of the Closing;13.Other closing conditions identified in the Investors due diligence or otherwise generally applicable to similar transactions.CovenantsThe Comp

15、any will provide ongoing covenants to (i) comply with the US Foreign Corrupt Practices Act, (ii) use of commercially reasonable efforts to avoid PFIC status and minimize the effects of CFC and PFIC status to the extent either occurs, (iii) comply with PRC law in all material respects, including, withoutlimitation, SAFE Circular 37 and SAFE Circular 7, (iv) file and r gister any equity pledge as contemplated by the transaction documents with the competent governmental authorities, and (v) take such other actions as may reasonab