Term Sheet For Series A Preference Shares In Page 12

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Non-Solicitation:
non-competition and non-solicitation clause.
Non-Disclosure and IP
Each current
and former
Founder, employee and consultant will enter
Assignment:
into a non-disclosure and IP assignment agreement in a form
reasonably acceptable to the
Lead
Investors.
Default rights
The Definitive Agreements (as defined below) will provide for
standard default rights of the Investor, upon occurrence of default,
including drag rights, redemption, and/or control over the board
composition.
th
Exit rights / Redemption
[If the Company has not achieved an IPO or trade sale by the [7
]
anniversary of Closing standard exit rights shall apply, including
rights to require repurchase of Investors’ shares, or finding of a third
party buyer, thereafter.]
[Unless prohibited by applicable law, the Series A Preference Shares
shall be redeemable at the option of holders of at least [__]% of the
Series A Preference Shareholders commencing any time after
[______] years at a price equal to the Original Purchase Price plus all
accrued but unpaid dividends.]
CONDITIONS TO CLOSING
Due Diligence:
Immediately after the execution of this Term Sheet, the Founders
shall procure that the Company provides the Lead Investor with all
information reasonably required for the purposes of financial,
business, tax, legal, regulatory, technical and compliance due
diligence.
The Founders shall also procure that the Company provides
reasonable access and necessary support to the professional advisors
and operational experts of the Lead Investor for the purpose of the
Due Diligence process.
Definitive Agreements:
The investment shall be made pursuant to definitive agreements
drafted by the counsel for the Lead Investor (“Definitive
Agreements”) which shall include at a minimum:
a subscription agreement (“Subscription Agreement”);
(i)
shareholders’ agreement between the Company, the
(ii)
existing shareholders of the Company and the Investors
(“Shareholders’ Agreement”); and
(iii) a new constitution of the Company setting out, amongst
other things, the preferential rights attaching to the Series A
12

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