Document:

EX-10.30

 Exhibit 10.30 

SHEN PENG 
 NEPTUNE MAX HOLDINGS
LIMITED 
 IMAGE FRAME INVESTMENT (HK) LIMITED
(意像架構投資(香港)有限公司) 

WATERDROP GROUP HK LIMITED (水滴集團(香港)有限公司
) 
 BEIJING ABSOLUTE HEALTH LTD. (北京健康之家科技有限公司) 

BEIJING ZONGQING XIANGQIAN TECHNOLOGY CO., LTD.
(北京纵情向前科技有限公司) 

BEIJING SHUIDI HULIAN TECHNOLOGY CO., LTD
(北京水滴互联科技有限公司) 

BEIJING SHUIDI HUBAO TECHNOLOGY CO., LTD.
(北京水滴互保科技有限公司) 

BEIJING ZHUIQIU JIZHI TECHNOLOGY CO., LTD.
(北京追求极致科技有限公司) 

AND 
 WATERDROP INC. 

 
  

SERIES D SUBSCRIPTION AGREEMENT 
  

 
  

							
	 CONTENTS
  
	  
 

		
	Clause	  	Page	 
			
	1.	 	 Interpretation
	  	 	2	 
			
	2.	 	 Sale and Purchase
	  	 	8	 
			
	3.	 	 Conditions
	  	 	8	 
			
	4.	 	 Completion
	  	 	9	 
			
	5.	 	 Warranties
	  	 	11	 
			
	6.	 	 Undertakings by the Company, the Founder and the Founder Entity
	  	 	11	 
			
	7.	 	 Termination
	  	 	12	 
			
	8.	 	 Indemnities
	  	 	13	 
			
	9.	 	 Confidential Information
	  	 	14	 
			
	10.	 	 Announcements
	  	 	15	 
			
	11.	 	 Costs and Taxes
	  	 	15	 
			
	12.	 	 General
	  	 	15	 
			
	13.	 	 Entire Agreement
	  	 	16	 
			
	14.	 	 Assignment
	  	 	16	 
			
	15.	 	 Notices
	  	 	16	 
			
	16.	 	 Governing Law and Jurisdiction
	  	 	17	 
			
	17.	 	 Governing Language
	  	 	17	 
		
	Schedule 1 Investment	  	 	19	 
		
	Schedule 2 Share Capitalisation	  	 	20	 
		
	Schedule 3 Warranties	  	 	21	 
		
	Schedule 4 Notice Details	  	 	22	 
		
	Exhibit 1 Form of Shareholders Agreement	  	 	23	 
		
	Exhibit 2 Form of Articles of Association	  	 	24	 

  

 THIS SERIES D SUBSCRIPTION AGREEMENT (this “Agreement”) is made on
November 20, 2020 
 BETWEEN: 
  

	(1)	 SHEN Peng, a citizen and resident of the PRC (identity card number: [***]) (“Founder”);

  

	(2)	 Neptune Max Holdings Limited, a company established under the laws of the British Virgin Islands, whose
registered office is at Sertus Chambers, P.O. Box 905, Quastisky Building, Road Town, Tortola, British Virgin Islands (the “Founder Entity”); 

 

	(3)	 Waterdrop Inc., an exempted company incorporated with limited liability in the Cayman Islands (with
registered number [***]), whose registered office is at Sertus Chambers, Governors Square, Suite # 5-204, 23 Lime Tree Bay Avenue, P.O. Box 2547, Grand Cayman, KY1-1104,
Cayman Islands (the “Company”); 

  

	(4)	 Waterdrop Group HK Limited
(水滴集團(香港)有限公司), a company incorporated with limited liability in the Hong Kong, whose registered office is at Room 1907, 19/F, Lee Garden One, 33 Hysan Avenue, Gauseway
Bay, Hong Kong (the “Waterdrop HK”); 

  

	(5)	 Beijing Absolute Health Ltd.
(北京健康之家科技有限公司),a company
incorporated with limited liability in the PRC (with registered number [***]), whose registered office is at Room 4103, 101, 1st Floor, Building 2, No. 208, Lize Middle Park, Chaoyang District, Beijing (the “WFOE”);

  

	(6)	 Beijing Zongqing Xiangqian Technology Co., Ltd. (北京纵情向前科技有限公司), a company incorporated with limited liability in the PRC (with registered number [***]),
whose registered office is at Room 4301, 3rd Floor, Building 2, No. 208, Lize Middle Park, Chaoyang District, Beijing (“Zongqing Xiangqian”); 

 

	(7)	 Beijing Shuidi Hulian Technology Co., Ltd
(北京水滴互联科技有限公司), a company incorporated with limited liability in the PRC (with registered
number [***]), whose registered office is at Room 4306, 3rd Floor, Building 2, No. 208, Lize Middle Park, Chaoyang District, Beijing室 (“Shuidi Hulian “);

  

	(8)	 Beijing Shuidi Hubao Technology Co., Ltd.
(北京水滴互保科技有限公司),a
company incorporated with limited liability in the PRC (with registered number [***]), whose registered office is atRoom 4203, 201, 2nd Floor, Building 2, No. 208, Lize Middle Park, Chaoyang District, Beijing (“Shuidi Hubao”);

  

	(9)	 Beijing Zhuiqiu Jizhi Technology Co., Ltd.
(北京追求极致科技有限公司), a company incorporated with limited liability in the PRC (with registered
number [***]), whose registered office is at 822, 8th Floor, Building 3, Courtyard 12, Qingnian Road, Chaoyang District, Beijing (“Zhuiqiu Jizhi”, together with Zongqing Xiangqian, Shuidi Hulian and Shuidi Hubao, collectively the
“Targets” and each a “Target”); and 

  

	(10)	 The person listed in Part A (the Investor) of Schedule 1 (Investment) (the
“Investor”). 

  
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 RECITALS: 
  

	(A)	 As at the date of this Agreement, the Company owns 100 per cent of the issued share capital of the
Waterdrop HK, which in turn owns all of the equity interests of the WFOE. The WFOE has entered into the Structured Contracts (as defined in the Shareholders Agreement) with each of the Targets to exercise effective control over and obtain all
economic benefits of the Target Group (as defined below). The Company, together with its direct and indirect, current and future subsidiaries (including but not limited to Waterdrop HK, WFOE and each of the companies in the Target Group)
shall together be referred to as the “Group” or the “Group Companies”, and each a “Group Company”. 

  

	(B)	 The Investor agrees to subscribe for, and the Company agrees to issue and allot, the Series D Shares on the
terms and subject to the conditions in this Agreement. 

 THE PARTIES AGREE as follows: 

 

	1.	 INTERPRETATION 

 

	1.1	 Definitions 

In this Agreement: 

“Accounts” means the audited consolidated balance sheet of the Target Group as at the Last Accounting Date and the audited
consolidated profit and loss statement and cash flow statement of the Target Group for the 12 month period ended on the Last Accounting Date, and all notes, reports and other documents annexed to those accounts. 

“Affiliate” means, in relation to a person, any other person which, directly or indirectly, controls, is controlled by or is
under the common control of the first mentioned person, and without limiting the generality of the foregoing, in the case of a natural person, which shall include, without limitation, such person’s spouse, parents, children, siblings, mother-in-law and father-in-law and brothers and sisters-in-law. For the purposes of this Agreement, “control” means, in relation to any person, having the power to direct the management or policies of such person, whether through the
ownership of more than 50 per cent of the voting power of such person, through the power to appoint a majority of the members of the board of directors or similar governing body of such person, or through contractual arrangements or otherwise,
and references to “controlled” or “controlling” shall be construed accordingly. 
 “Applicable
Laws” means, with respect to a person, any laws, regulations, rules, measures, guidelines, treaties, judgments, determination, orders or notices of any Government Authority or stock exchange that is applicable to such person. 

“Approved Budget” has the meaning given to it in the Shareholders Agreement. 

“Articles of Association” means the sixth amended and restated memorandum and articles of association of the Company in the
form set out in Exhibit 2 (Form of Articles of Association), as the same may be amended, restated or replaced from time to time. 

“Board” means the board of directors of the Company. 

  
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 “Business” means the business the Group Companies currently engages in and
purports to engage in in the future, including but not limited to the Principle Business. 
 “Business Day” means any day
other than a Saturday or Sunday or public holiday in the PRC or Hong Kong. 
 “Company’s Bank Account” means the bank
account of the Company as shall have been notified by the Company to the Investor at least seven (7) Business Days before the Completion Date. 

“Completion” means completion of the Subscription in accordance with this Agreement. 

“Completion Date” means the date on which the last of the Conditions is satisfied or waived, or such other date as the
Investor and the Company may agree in writing. 
 “Condition” means a condition set out in Clause 3.1 (Conditions).

 “Confidential Information” means: 
  

	 	(a)	 all information which relates to the business and affairs of any Group Company or of any party; and

  

	 	(b)	 all information which relates to the provisions or subject matter of this Agreement or any document referred to
herein or the negotiations relating to this Agreement, 

 but does not include information: 

 

	 	(i)	 to the extent that it is generally known to the public not as a result of any breach of duty of
confidentiality; 

  

	 	(ii)	 that was lawfully in the possession of the receiving party prior to its disclosure by the disclosing party; or

  

	 	(iii)	 that is or becomes available to the receiving party other than as a result of a disclosure by a person which
the receiving party knows is in breach of a duty of confidentiality owed to the disclosing party; or 

  

	 	(iv)	 relating solely to the shareholding of any of the Investor in the Company which is provided on a confidential
basis by the Investor to a Governmental Authority in connection with the regulatory supervision of the Investor or its Affiliates. 

“Encumbrance” means a mortgage, charge, pledge, lien, option, restriction, right of first refusal, right of pre-emption, third-party right or interest, other encumbrance or security interest of any kind, or another type of preferential arrangement (including, without limitation, a title transfer or retention arrangement)
having similar effect. 

  
 3 

 “ESOP” means the WATERDROP INC. 2018 SHARE INCENTIVE PLAN adopted by the
Company on February 1, 2019 (as amended from time to time), or other employees’ share scheme or employee trust or share ownership plan or other profit sharing, bonus or incentive scheme as adopted by the Company from time to time. 

“ESOP Shares” means any Ordinary Shares (or options representing any Ordinary Shares) issuable to employees, officers or
directors of the Company pursuant to the ESOP. 
 “Government Authorities” means any national, provincial, municipal or
local government, administrative or regulatory body or department, court, tribunal, arbitrator or any body that exercises the function of a regulator. 

“Group” has the meaning given in Recital (A). 

“Group Company” has the meaning given in Recital (A). 

“HKIAC” has the meaning given in Clause 16.2 (Arbitration). 

“Waterdrop HK” has the meaning given in Preamble. 

“Hong Kong” means the Hong Kong Special Administrative Region of the PRC. 

“Investor” means the persons set out in Schedule 1Part A (The Investor) of Schedule 1 (Investment). 

“Last Accounting Date” means June 30, 2020. 

“Long Stop Date” means November 30, 2020 or such other date as the Investor and the Company may agree in writing. 

“Material Adverse Change” means any event, matter or circumstance (or series thereof) arising or occurring after the date of
this Agreement which (on its own or in aggregate) is, or is reasonably likely to be, materially adverse to (i) the existence, Business, operations, intellectual property rights, assets, liabilities (including contingent liabilities), condition
(financial, trading or otherwise), financial results or prospects of the Group, the Founder and/or the Founder Entity, (ii) the ability of the Target Group to carry out its Business (including Permits) or (iii) the ability of any party to
perform its respective obligation under this Agreement or any Transaction Document. 

“Non-PRC Group Company” means any Group Company which is incorporated under the laws
of a jurisdiction other than the PRC. 
 “Notice” has the meaning given in Clause 15.1 (Format of notice). 

“Ordinary Shares” means the ordinary shares of par value USD 0.000005 each in the share capital of the Company. 

“Permit” means: 
  

	 	(a)	 any permit, licence, consent, approval, certificate, qualification or other authorisation; or

  
 4 

	 	(b)	 any filing, notification, or registration, 

in each case necessary for the effective operation of any Group Company’s business or its ownership, possession, occupation or use of any
asset. 
 “PRC” means the People’s Republic of China excluding, for the purposes of this Agreement, the Special
Administrative Regions of Hong Kong and Macao and the territory of Taiwan. 
 “PRC Accounting Standards” means the China
Accounting Standards (CAS 2006) issued by the Ministry of Finance on 15 February 2006, as supplemented by relevant rules and guidelines issued from time to time, and other applicable PRC accounting regulations. 

“PRC Group Company” means any Group Company which is established under the laws of the PRC. 

“Preferred Shares” means Series Pre-A Shares, Series A Shares, Series A+ Shares,
Series B Shares, Series C Shares, Series C+ Shares, Series C++ Shares and Series D Shares. 
 “Principal Business” means the
businesses in Internet mutual-aid society, critical illness fund-raising and insurance. 

“Relevant Claim” means a Warranty Claim or any claim by the Investor for indemnification or pursuant to any other provision of
this Agreement. 
 “Renminbi” or “RMB” means the lawful currency of the PRC. 

“Rules” has the meaning given in Clause 16.2 (Arbitration). 

“Series A Shares” means the series A preferred shares of par value USD 0.000005 each in the share capital of the Company
having the rights, powers and preferences set out in the Articles of Association. 
 “Series A+ Shares” means the series A+
preferred shares of par value USD 0.000005 each in the share capital of the Company having the rights, powers and preferences set out in the Articles of Association. 

“Series B Shares” means the series B redeemable convertible preferred shares of par value USD 0.000005 each in the share
capital of the Company having the rights, powers and preferences set out in the Articles of Association. 
 “Series C
Shares” means the series C redeemable convertible preferred shares of par value USD 0.000005 each in the share capital of the Company having the rights, powers and preferences set out in the Articles of Association. 

“Series C+ Shares” means the series C+ redeemable convertible preferred shares of par value USD 0.000005 each in the share
capital of the Company having the rights, powers and preferences set out in the Articles of Association. 

  
 5 

 “Series C++ Shares” means the series C++ redeemable convertible preferred
shares of par value USD 0.000005 each in the share capital of the Company having the rights, powers and preferences set out in the Articles of Association. 

“Series D Shares” means the series D redeemable convertible preferred shares of par value USD 0.000005 each in the share
capital of the Company having the rights, powers and preferences set out in the Articles of Association. 
 “Series Pre-A Shares” means the series pre-A preferred shares of par value USD 0.000005 each in the share capital of the Company having the rights, powers and preferences set
out in the Articles of Association. 
 “Share” means any of the issued shares of the Company. 

“Shareholders” means the holder of any Share of the Company. 

“Shareholders Agreement” means the fourth amended and restated shareholders agreement to be entered into between the
Shareholders in the form set out in Exhibit 1 (Form of Shareholders Agreement). 
 “Subscription” means the
subscription by the Investor of the Subscription Shares set out opposite its own name in accordance with this Agreement. 

“Subscription Price” means the subscription price set out in the column headed Subscription Price of Schedule 1Part B
(Investment Particulars) of Schedule 1 (Investment). 
 “Subscription Shares” means the subscription shares
set out in the column headed Subscription Shares of Schedule 1Part B (Investment Particulars) of Schedule 1 (Investment). 

“Target” has the meaning given in Preamble; 

“Target Group” means the group of companies comprising the Targets and each of their direct and indirect subsidiaries; 

“Tax” means any form of taxation, levy, duty, charge, contribution, or withholding of whatever nature (including any related
fine, penalty, surcharge or interest) imposed, collected or assessed by, or payable to, any national, provincial, municipal or local government or other authority, body or official anywhere in the world exercising a fiscal, revenue, customs or
excise function. 
 “Transaction Documents” means this Agreement, the Shareholders Agreement, the Articles of Association,
and any other related document necessary for or in connection with the Subscription. 
 “US Dollar” or
“USD” means the lawful currency of the United States of America. 
 “Warrantor” means any of the Founder,
the Founder Entity, and the Group Companies. 
 “Warranty” means a statement contained in Schedule 3 (Warranties).

  
 6 

 “Warranty Claim” means a claim by the Investor under or pursuant to the
provisions of Clause 5.1 (Warranties). 
 “WFOE” has the meaning given in Preamble. 

 

	1.2	 References 

In this Agreement, a reference to: 
  

	 	1.2.1	 a “subsidiary” means, with respect to any given person, any person of which the given person,
directly or indirectly owns more than 50 per cent of the issued and outstanding share capital, voting interests, registered capital or other equity interest; 

 

	 	1.2.2	 a “holding company” means, with respect to a company, any other company which directly or
indirectly owns more than 50 per cent of the voting shares, registered capital or other equity interest in the first mentioned company; 

  

	 	1.2.3	 a “party” or “parties”, unless the context otherwise requires, is a reference
to a party or parties to this Agreement and includes a reference to that party’s legal personal representatives, successors and permitted assigns; 

  

	 	1.2.4	 an agreement or a document is a reference to such agreement or document as amended, restated or supplemented
from time to time, unless otherwise expressed to the contrary; 

  

	 	1.2.5	 a clause, paragraph or schedule, unless the context otherwise requires, is a reference to a clause or paragraph
of, or schedule to, this Agreement; 

  

	 	1.2.6	 a time of the day is a reference to the time in PRC; 

 

	 	1.2.7	 the singular includes the plural and vice versa unless the context otherwise requires; and

  

	 	1.2.8	 in calculations of share numbers, (i) references to a “fully-diluted basis” mean that the
calculation is to be made assuming that all outstanding options, warrants and other equity securities convertible into or exercisable or exchangeable for Ordinary Shares (whether or not by their terms then currently convertible, exercisable or
exchangeable) have been so converted, exercised or exchanged; and (ii) references to an “as-converted basis” mean that the calculation is to be made assuming that all Preferred Shares in
issue have been converted into Ordinary Shares. 

  

	1.3	 Schedules and Exhibits 

The Schedules and Exhibits to this Agreement form part of this Agreement. 

 

	1.4	 Headings 

The headings in this Agreement do not affect its interpretation. 

  
 7 

	2.	 SALE AND PURCHASE 

 

	2.1	 Subscription of Series D Shares 

 

	 	2.1.1	 The Investor agrees to subscribe for, and the Company agrees to issue and allot the number of Series D Shares
set out opposite its name in Schedule 1Part B (Investment Particulars) of Schedule 1 (Investment) (the “Subscription Shares”) free from any Encumbrances, at the respective subscription price set out opposite its name
in Schedule 1Part B (Investment Particulars) of Schedule 1 (Investment) (the “Subscription Price”). 

  

	 	2.1.2	 The Subscription Shares, when issued at Completion, will comprise 7.3783 per cent (7.3783%) of the
Company’s allotted share capital on a fully-diluted and as-converted basis immediately after the Completion. 

  

	2.2	 Status of Subscription Shares 

The Company undertakes to the Investor that the Subscription Shares will, when issued, have such rights, powers and preferences as set out in
Exhibit 2 (Form of Articles of Association). 
  

	2.3	 Use of proceeds 

From Completion, the Company and the Targets shall, and shall procure the Group Companies to, apply the proceeds from the issue of the
Subscription Shares in accordance with the Approved Budget for the expansion of and capital expenditure relating to the Principal Business. Unless otherwise approved in accordance with the terms and provisions of the Shareholders Agreement, the
proceeds shall not be used in the payment of any debts or obligations of the Group Companies or in the repurchase or cancellation of securities held by any shareholders of the Group Companies. It is further agreed that, from Completion, the Company
shall use its commercially reasonable efforts to contribute the proceeds from the issue of the Subscription Shares directly into the WFOE as investment capital. 
  

	3.	 CONDITIONS 

 

	3.1	 Conditions 

Completion is conditional on each of the following Conditions being satisfied (or waived by the Investor in accordance with Clause 3.3
(Waiver of Conditions)) on or before the Long Stop Date: 
  

	 	3.1.1	 there has been no material breach of any of the Warranties as given on the date of this Agreement and as at
Completion as if made on that date; 

  

	 	3.1.2	 there has been no material breach by the Group, the Founder or the Founder Entity of any provision contained in
this Agreement; 

  

	 	3.1.3	 the due execution of the Transaction Documents that are required to be executed by each of the relevant parties
thereto (other than the Investor); 

  
 8 

	 	3.1.4	 the passing of written resolutions of the Company, in the form and substance to the satisfaction of the
Investor, (i) approving the issue of the Subscription Shares upon Completion; (ii) adopting the Articles of Association containing the rights, powers and preferences of the Shares; and (iii) Shareholders other than the Investor
waiving their respective pre-emption right in connection with the issuance of Series D Shares; 

  

	 	3.1.5	 the passing of written resolutions of the Group Companies (as applicable) approving the transactions
contemplated by the Transaction Documents, in the form and substance to the satisfaction of the Investor; 

  

	 	3.1.6	 no Governmental Authority of competent jurisdiction shall have enacted, issued or promulgated any Law or
granted any order that is in effect and has the effect of making the transactions contemplated by the Transaction Documents illegal in any jurisdiction in which the Group Companies have material business or operations or in which a Group Company is
incorporated or which has the effect of prohibiting or otherwise preventing the consummation of any of such transactions in any jurisdiction in which the Group Companies have material business or operations, and each Group Company shall have
obtained any and all Approvals and waivers necessary for the consummation of the transactions contemplated hereby, each of which shall be in full force and effect as of the Completion; and 

 

	 	3.1.7	 the Company delivering a certificate dates as of the Completion Date signed by a director of the Warrantors
evidencing the Conditions set out in Section 3 have been satisfied. 

  

	3.2	 Responsibility for satisfaction of Conditions 

 

	 	3.2.1	 Each of the Company, the Group Companies, the Founder and the Founder Entity shall use its best efforts to
achieve satisfaction of each Condition set out in Clause 3.1 (Conditions) as soon as practicable after the date of this Agreement and in any event by not later than the Long Stop Date. 

 

	 	3.2.2	 If, at any time, any of the parties becomes aware of the satisfaction of any Condition that it is responsible
for the satisfaction or becomes aware of any fact or circumstance that might prevent any Condition from being satisfied, it shall immediately inform the other parties in writing. 

 

	3.3	 Waiver of Conditions 

At any time on or before the Long Stop Date, the Investor may waive a Condition set out in Clause 3.1 (Conditions) by notice to the
Company and the Founder on any terms the Investor decides. 
  

	4.	 COMPLETION 

  

	4.1	 Date and place 

Completion shall take place on the Completion Date remotely via electronic exchange of documents and signatures. 

  
 9 

	4.2	 Actions to be taken at Completion 

 

	 	4.2.1	 At Completion, the Company shall: 

 

	 	(a)	 issue and allot to the Investor the number and class of Subscription Shares as set forth in Schedule 1Part B
(Investment Particulars) of Schedule 1 (Investment), as fully paid and free from any Encumbrances; 

  

	 	(b)	 register the Investor as the holder of the relevant Subscription Shares in the register of members of the
Company and deliver to the Investor the register of members of the Company evidencing the registration of the Investor or its nominee(s) as a shareholder of the Company and its legal ownership of the Subscription Shares or a copy certified to be a
true copy by the Company’s registered agent; and 

  

	 	(c)	 deliver to the Investor a copy of duly executed share certificate in the name of the Investor reflecting the
Investor as the holder of the Subscription Shares, with the original duly executed share certificate delivered to the Investor within ten (10) Business Days after the Completion Date. 

 

	 	4.2.2	 Within fifteen (15) Business Days after the Completion, the Investor shall make the payment of the
Subscription Price by initiation of wire transfer of immediately available funds to the Company’s Bank Account. 

  

	4.3	 Investor’ obligation to complete 

The Investor is not obliged to purchase the Subscription Shares at the Completion Date unless the Company complies with all its obligations
under this Clause 4 and Clause 6. 
  

	4.4	 Right to postpone or terminate 

If Completion does not take place on the Completion Date, or the Company fails to comply with any of its obligations under this Clause 4
(whether such failure by the Company amounts to a repudiatory breach or not), the Investor may by notice to the Company within ten (10) days after the Completion Date: 
  

	 	4.4.1	 proceed to Completion to the extent reasonably practicable; 

 

	 	4.4.2	 postpone Completion to a date not later than the Long Stop Date; or 

 

	 	4.4.3	 terminate this Agreement. 

 

	4.5	 Postponement of Completion 

If the Investor postpones Completion to another date in accordance with sub-clause 4.4.2 of Clause
4.2 (Actions to be taken at Completion), the provisions of this Agreement apply as if that other date is the Completion Date. 

  
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	5.	 WARRANTIES 

  

	5.1	 Warranties 

Each of the Warrantors jointly and severally represents and warrants to the Investor that each Warranty in Schedule 3 is true, accurate and not
misleading at the date of this Agreement. Immediately before Completion, each of the Warrantors is deemed to jointly and severally represent and warrant to the Investor that each Warranty is true, accurate and not misleading by reference to the
facts and circumstances as at Completion. For this purpose only, where there is an express or implied reference in a Warranty to the “date of this Agreement”, that reference is to be construed as a reference to Completion. 

 

	5.2	 Reliance on Warranties 

Each of the Warrantors acknowledges that the Investor is entering into this Agreement in reliance on each Warranty which has also been given as
a representation and with the intention of inducing the Investor to enter into this Agreement. 
  

	5.3	 No claims against directors and employees 

Each of the Warrantors undertakes not to make any claim against a director, manager or employee of any Group Company which it may have in
respect of a misrepresentation, inaccuracy or omission in or from information or advice provided by such person for the purpose of assisting such Warrantor to make any representation, give any Warranty. 

 

	5.4	 Independence of Warranties 

Each Warranty is to be construed independently and (except where this Agreement provides otherwise) is not limited by a provision of this
Agreement or another Warranty. 
  

	6.	 UNDERTAKINGS BY THE COMPANY, THE FOUNDER AND THE FOUNDER ENTITY 

 

	6.1	 Between the execution of this Agreement and the Completion Date, each of the Warrantors jointly and severally
undertakes to the Investor to procure that, between the date of this Agreement and the Completion Date, each Group Company shall conduct its business in the ordinary and usual course as it is carried on as at the date of this Agreement.

  

	6.2	 Each of the Warrantors jointly and severally undertakes to the Investor to procure the following:

  

	 	6.2.1	 The Group shall, and the Founder and the Founder Entity shall procure that the Group shall, use the proceeds
from the Subscription in accordance with Clause 2.3. 

  

	 	6.2.2	 The Company shall file the Articles of Association with the Registrar of Companies of the Cayman Islands within
three (3) days after the Closing. 

  
 11 

	7.	 TERMINATION 

  

	7.1	 Right to terminate or proceed 

 

	 	7.1.1	 If, at any time before Completion: 

 

	 	(a)	 there is a Material Adverse Change to the Group taken as a whole; 

 

	 	(b)	 any Government Authority issues, promulgates or enforces any law, regulation, rule, policy, order or notice
that prohibits the completion of the transactions contemplated by this Agreement; 

  

	 	(c)	 there is a material breach of any of the Warranties as given on the date of this Agreement, or any event occurs
which would constitute a material breach of any of the Warranties as if the Warranties were repeated on each day before the Completion Date by reference to the facts and circumstances then existing, and for this purpose only any references in the
Warranties to the “date of this Agreement” shall be construed as references to the relevant date; or 

  

	 	(d)	 any Warrantor is in material breach of any provision of this Agreement. 

The Investor may by notice in writing to the Warrantors elect to proceed to Completion or terminate this Agreement, solely in respect of its
own investment. 
  

	 	7.1.2	 If any Condition has neither been waived in accordance with Clause 3.3 (Waiver of Conditions) nor
satisfied by the Long Stop Date, or Completion has not taken place by the Long Stop Date, the Investor shall have the right to terminate this Agreement with immediate effect by giving written notice to the Company and the Founder, solely in respect
of its own Subscription. 

  

	 	7.1.3	 If the Investor fails to pay its Subscription Price within fifteen (15) Business Days after Completion in
accordance with Clause 4.2.2, the Warrantors shall have the right to terminate this Agreement with immediate effect by giving written notice to the Investor and the Company shall have the right to cancel the Subscription Shares issued to the
Investor. 

  

	 	7.1.4	 This Agreement may be terminated prior to the Completion by mutual written consent of the parties.

  

	7.2	 Obligation to notify 

Each of the Warrantors jointly and severally undertakes to notify the Investor in writing immediately if it becomes aware of a matter, breach,
event, fact or circumstance that may give rise to a right of termination under Clause 7.1 (Right to Terminate) (and, in any event, within three (3) Business Days of the occurrence of such matter, breach, event, fact or circumstance).

  
 12 

	7.3	 Effect of termination 

Each party’s further rights and obligations cease immediately on termination, except that Clauses 8 (Indemnities), Clauses 9
(Confidential Information), 10 (Announcements), 11 (Costs and Taxes), 12 (General), 13 (Entire Agreement), 15 (Notices), 16 (Governing Law and Jurisdiction) and 17 (Governing Language) shall
survive the termination of this Agreement and shall continue in full force and effect. Termination does not affect a party’s accrued rights and obligations as at the date of termination and shall not release any Party from any liability that
has already accrued as of the date of such termination, or constitute a waiver or release of, or otherwise be deemed to prejudice or adversely affect, any rights, remedies or claims, whether for damages or otherwise, which a Party may have under
this Agreement or applicable Laws or which may arise out of or in connection with such termination. 
  

	8.	 INDEMNITIES 

  

	8.1	 Indemnities 

Each of the Warrantors shall jointly and severally indemnify the Investor, and keep the Investor indemnified, on demand against each loss,
liability and cost suffered or incurred (directly or indirectly) by the Investor (including, without limitation, loss of profit) as a result of or which arises out of or in connection with any inaccuracy in or breach or non-performance of any of the representations, warranties, covenants or agreements made by any Warrantor in or pursuant to this Agreement. 
  

	8.2	 Indemnification of costs of resolving a Relevant Claim 

Each of the Warrantors shall jointly and severally indemnify the Investor, and keep the Investor indemnified, on demand against each loss,
liability and cost (including, without limitation, fees and costs of legal counsel and other professionals) which the Investor incurs arising (directly or indirectly) out of: 
  

	 	8.2.1	 the settlement of any Relevant Claim against the Warrantors or the enforcement of a settlement; and

  

	 	8.2.2	 legal proceedings against the Warrantors in respect of a Relevant Claim in which judgment is given for the
Investor or the enforcement of the judgment. 

  

	8.3	 Limitations 

Notwithstanding any other provisions of this Agreement: 
  

	 	8.3.1	 the maximum aggregate liability of the Warrantors to the Investor in respect of all claims under Clause 8.1 and
all liability and costs under Clause 8.2 shall be limited to the Subscription Price for the Investor set out opposite its name in Part B (Investment Particulars) of Schedule 1 (Investment); 

 

	 	8.3.2	 the maximum aggregate liability of the Founder in respect of all claims under Clause 8.1 and all liability and
costs under Clause 8.2 shall be limited to the aggregate fair value of all of the shares in the Group Companies held by the Founder as at the date of the Relevant Claim; and 

 

	 	8.3.3	 the Warrantors shall have no liability to the Investor unless and until the aggregate amount of the losses
suffered or incurred by the Investor exceeds RMB2,000,000, in which case the Warrantors shall only be liable to the Investor for any amount in excess of such threshold.  

  
 13 

	9.	 CONFIDENTIAL INFORMATION 

 

	9.1	 Confidentiality obligations 

Each of the parties undertakes to the other parties that before and after Completion it shall: 

 

	 	9.1.1	 not use or disclose to any person Confidential Information it has or acquires; 

 

	 	9.1.2	 make every effort to prevent the use or disclosure of Confidential Information; and 

 

	 	9.1.3	 procure that each of its Affiliates complies with sub-clauses 9.1.1 and
9.1.2 of this Clause 9.1. 

  

	9.2	 Exceptions 

Clause 9.1 (Confidentiality obligations) does not apply to disclosure of Confidential Information: 

 

	 	9.2.1	 to any director, officer or employee of any party whose function requires him to have the Confidential
Information on an as-need-to-know basis, in each case only where such persons are under appropriate nondisclosure obligations;

  

	 	9.2.2	 to the extent that it is required to be disclosed by Applicable Laws, by any rule of a listing authority or
stock exchange on which any party’s shares are listed or traded, or by any Government Authority with relevant powers to which any party is subject or submits, provided that the disclosure shall, so far as is practicable, be made after
consultation with the other parties and after taking into account the other parties’ reasonable requirements as to its timing, content and manner of making or despatch, and shall furnish only that portion of the information that is legally
required; 

  

	 	9.2.3	 to any adviser (including legal counsel or auditor) for the purpose of advising any party in connection with
the transactions contemplated by this Agreement provided that such disclosure is essential for these purposes and that such party procures that such adviser complies with Clause 9.1 (Confidentiality obligations); 

 

	 	9.2.4	 by the Investor (a) to its Affiliates, and (b) in connection with a proposed exit, to potential
purchasers, investment banks, other intermediaries or and advisers in connection with such purpose; or 

  

	 	9.2.5	 to the extent that the disclosing party has given prior written consent to such disclosure.

  
 14 

	10.	 ANNOUNCEMENTS 

None of the parties may make or send a public announcement, communication or circular concerning the transactions referred to in this Agreement
unless it has first obtained the other parties’ written consent, which may not be unreasonably withheld or delayed.. 
  

	11.	 COSTS AND TAXES 

 

	11.1	 Costs 

Except where this Agreement or the relevant document provides otherwise, each party shall pay its own costs relating to the negotiation,
preparation, execution and performance by it of this Agreement and of each document referred to in it. 
  

	11.2	 Taxes 

Except as otherwise provided in this Agreement, each of the parties shall be responsible for its own Tax liabilities arising from the
Subscription under this Agreement. 
  

	12.	 GENERAL 

  

	12.1	 Amendment 

An amendment of this Agreement is valid only if it is in writing and signed by or on behalf of each party. 

 

	12.2	 Waiver 

The failure to exercise or the delay in exercising a right or remedy provided by this Agreement or by law does not impair or constitute a
waiver of such right or remedy. No single or partial exercise of a right or remedy provided by this Agreement or by law prevents further exercise of the right or remedy or the exercise of another right or remedy. 

 

	12.3	 Survival 

Except to the extent that they have been performed and except where this Agreement provides otherwise, the obligations contained in this
Agreement remain in force after Completion. 
  

	12.4	 Severability 

The invalidity, illegality or unenforceability of a provision of this Agreement does not affect or impair the validity of the remainder of this
Agreement, and such invalid or unenforceable provision may be replaced by a valid and enforceable provision closest to the original intentions of the parties. 

  
 15 

	12.5	 Counterparts 

This Agreement may be executed in any number of counterparts, each of which when executed and delivered is an original and all of which
together evidence the same agreement. 
  

	13.	 ENTIRE AGREEMENT 

This Agreement and the other Transaction Documents constitute the entire agreement and supersede any previous agreements between the parties
relating to the subject matter of this Agreement. 
  

	14.	 ASSIGNMENT 

 

	14.1	 Assignment by the Investor 

Prior to Completion, the Investor (and its successors and assigns) may, without the consent of any other party of this Agreement, assign the
benefit of all or any of its rights under this Agreement to its Affiliates. 
  

	14.2	 No assignment by Company and Founder 

None of the Company, the Founder nor the Founder Entity shall assign or in any other way alienate any of its rights under this Agreement
whether in whole or in part. 
  

	15.	 NOTICES 

 

	15.1	 Format of notice 

A notice or other communication under or in connection with this Agreement (a “Notice”) shall be: 

 

	 	15.1.1	 in writing; 

  

	 	15.1.2	 in the Chinese language; and 

 

	 	15.1.3	 delivered personally or sent by a reputable international courier (e.g. FedEx, DHL) or by fax or by email to
the party due to receive the Notice at its address or fax number or email address set out in Clause 15.3 (Notice details) or to such other addressee, address or fax number or email address as the party due to receive the Notice may specify by
giving the other party due to send the Notice not less than five (5) Business Days’ written notice before the Notice was despatched. 

  

	15.2	 Deemed delivery of notice 

Unless there is evidence that it was received earlier, a Notice is deemed to have been duly given if: 

 

	 	15.2.1	 delivered personally, when left at the address set out in Clause 15.3 (Notice details);

  
 16 

	 	15.2.2	 sent by a reputable international courier, three (3) Business Days after posting it;

  

	 	15.2.3	 sent by fax, when confirmation of its transmission has been recorded by the sender’s fax machine; and

  

	 	15.2.4	 sent by email, when confirmation of delivery has been recorded by the sender’s email box.

  

	15.3	 Notice details 

The address, phone number, fax number (if any), the email address and the addressee for the purpose of
sub-clause 15.1.3 of Clause 15.1 are set out in Schedule 4 (Notice Details). 
  

	16.	 GOVERNING LAW AND JURISDICTION 

 

	16.1	 Governing law 

This Agreement and the arbitration agreement contained herein are governed by, and shall be construed in accordance with, the laws of Hong
Kong. 
  

	16.2	 Arbitration 

Any dispute, controversy or claim arising in any way out of or in connection with this Agreement, or the breach, termination or invalidity
thereof (whether contractual, pre-contractual or non-contractual) shall be settled by binding arbitration administered by the Hong Kong International Arbitration Centre
(“HKIAC”) in accordance with the HKIAC Administered Arbitration Rules in force as at the date of this Agreement (“Rules”), which Rules are deemed to be incorporated by reference into this Clause and as may be
amended by the rest of this Clause. The seat of the arbitration shall be Hong Kong. 
  

	16.3	 Appointment of arbitrators 

The arbitration tribunal shall consist of three arbitrators to be appointed in accordance with the Rules. 

 

	16.4	 Arbitration proceedings and award 

The language to be used in the arbitral proceedings shall be English and any arbitral award shall be given in English. Nothing in this Clause
16.4 shall be construed as preventing any party from seeking conservatory or interim relief from any court of competent jurisdiction. Any award shall be final and binding upon the parties from the day it is made. The parties undertake to carry out
each and every arbitral award without delay. 
  

	17.	 GOVERNING LANGUAGE 

This Agreement is written in English. If this Agreement is translated into another language, the English version shall prevail. 

  
 17 

 [Remainder of page intentionally left blank] 

  
 18 

 SCHEDULE 1 

INVESTMENT 

  
 19 

 SCHEDULE 2 

SHARE CAPITALISATION 

  
 20 

 SCHEDULE 3 

WARRANTIES 

  
 21 

 SCHEDULE 4 

NOTICE DETAILS 

  
 22 

 EXHIBIT 1 

FORM OF SHAREHOLDERS AGREEMENT 

  
 23 

 EXHIBIT 2 

FORM OF ARTICLES OF ASSOCIATION 

  
 24 

 EXECUTED by the parties on the date first written above: 

 

			
	Waterdrop Inc.
		
	By:	 	 /s/ SHEN Peng

	Name: SHEN Peng
	Title: Director
	
	SHEN Peng
		
	By:	 	 /s/ SHEN Peng

	
	Neptune Max Holdings Limited
		
	By:	 	 /s/ SHEN Peng

	Name: SHEN Peng
	Title: Director
	
	Waterdrop Group HK Limited
	(水滴集團(香港)有限公司
)
		
	By:	 	 /s/ SHEN Peng

	Name: SHEN Peng
	Title: Director

  
 Waterdrop Inc. 

Signature Page to Series D Subscription Agreement 

 EXECUTED by the parties on the date first written above: 

Beijing Absolute Health Ltd.
(北京健康之家科技有限公司) (seal) 

[Company seal is affixed] 
  

			
	By:	 	 /s/ SHEN Peng

	Name: SHEN Peng
	Title: Legal Representative

 Beijing Zongqing Xiangqian Technology Co., Ltd.
(北京纵情向前科技有限公司)(seal) 

[Company seal is affixed] 
  

			
	By:	 	 /s/ SHEN Peng

	Name: SHEN Peng
	Title: Legal Representative

 Beijing Shuidi Hubao Technology Co., Ltd.
(北京水滴互保科技有限公司)(seal) 

[Company seal is affixed] 
  

			
	By:	 	 /s/ SHEN Peng

	Name: SHEN Peng
	Title: Legal Representative

 Beijing Shuidi Hulian Technology Co., Ltd
(北京水滴互联科技有限公司)(seal) 

[Company seal is affixed] 
  

			
	By:	 	 /s/ SHEN Peng

	Name: SHEN Peng
	Title: Legal Representative

 Beijing Zhuiqiu Jizhi Technology Co., Ltd.
(北京追求极致科技有限公司)(seal) 

[Company seal is affixed] 
  

			
	By:	 	 /s/ SHEN Peng

	Name: SHEN Peng
	Title: Legal Representative

  
 Waterdrop Inc. 

Signature Page to Series D Subscription Agreement 

 EXECUTED by the parties on the date first written above: 

Image Frame Investment (HK) Limited (意像架構投資(香港)有限公司) 
  

			
	By:	 	 /s/ MA Huateng

  
 Waterdrop Inc. 

Signature Page to Series D Subscription Agreementex_240682.htm

Exhibit 10.1

 

THIS NOTE IS SUBJECT TO THE TERMS OF THE INTERCREDITOR AND SUBORDINATION AGREEMENT, DATED AS OF APRIL 12, 2021, AMONG FIRST FOUNDATION BANK (THE “SENIOR CREDITOR”) AND SKYWORDS FAMILY FOUNDATION INC. AND THE OTHER PARTIES THERETO, AS THE SAME MAY BE AMENDED, MODIFIED, RESTATED OR SUPPLEMENTED FROM TIME TO TIME (THE “SUBORDINATION AGREEMENT”), TO THE EXTENT, AND IN THE MANNER PROVIDED IN THE SUBORDINATION AGREEMENT. NOTWITHSTANDING ANY STATEMENT TO THE CONTRARY CONTAINED IN THIS NOTE, NO PAYMENT OR PREPAYMENT OF ANY NATURE ON ACCOUNT OF THE OBLIGATIONS HEREUNDER, WHETHER OF PRINCIPAL, INTEREST OR PREMIUM, SHALL BE MADE, PAID, RECEIVED OR ACCEPTED, AND NO REMEDIES SHALL BE PURSUED BY LENDER, EXCEPT IN ACCORDANCE WITH THE TERMS OF SUCH SUBORDINATION AGREEMENT.

 

AMENDED AND RESTATED PROMISSORY NOTE

 

 

This AMENDED AND RESTATED PROMISSORY NOTE (this “Note”) is entered into as of April 12, 2021, between Skywords Family Foundation Inc. (“Lender”), and Cyanotech Corporation, a Nevada corporation (“Borrower”).

 

RECITALS

 

WHEREAS, Borrower issued that certain Promissory Note, dated as of April 12, 2019 (the “Existing Promissory Note” and such date, the “Original Closing Date”) in favor of Lender in connection with Lender advancing to Borrower a principal amount of One Million And Five Hundred Thousand Dollars ($1,500,000.00) on the Original Closing Date;

 

WHEREAS, Borrower and Lender have agreed to amend, restate, replace or otherwise modify without novation, as applicable, the Existing Promissory Note on the date hereof (the date of such amendment and restatement, the “Amendment and Restatement Date”);

 

WHEREAS, on the Amendment and Restatement Date, Borrower and Lender have agreed to so amend, restate, replace or otherwise modify without novation, as applicable, the Existing Promissory Note in order to convert Five Hundred Thousand Dollars ($500,000.00) of the outstanding principal amount thereunder into revolving loans that may be prepaid and reborrowed from time to time in an aggregate principal amount not to exceed Five Hundred Thousand Dollars ($500,000.00) (the “Maximum Revolving Amount”), and concurrently with such conversion, Borrower shall have repaid in cash to Lender principal in an aggregate amount equal to Five Hundred Thousand Dollars ($500,000.00);

 

WHEREAS, Borrower and Lender have further agreed to so amend, restate, replace or otherwise modify without novation, as applicable, the Existing Promissory Note in order to, among other things: (a) extend the Maturity Date to April 12, 2024 and (b) secure all obligations under the Note by the Collateral provided from time to time by Borrower;

 

WHEREAS, Borrower and Lender are willing to take the actions described in the preceding paragraph on the terms and conditions set forth herein.

 

AGREEMENT

 

NOW THEREFORE, for good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the parties hereto amend and restate the Existing Promissory Note and covenant and agree as follows:

 

FOR VALUE RECEIVED, Borrower promises to pay to the order of Lender the principal amount of this Note together with interest at the rate stated hereunder.

 

1

 

 

1.    Amendment and Restatement Date Transactions. On the Original Closing Date, Lender delivered to Borrower, and Borrower promised to pay to the order of Lender under the Existing Promissory Note, the aggregate principal amount of One Million and Five Hundred Thousand Dollars ($1,500,000.00) (the “Existing Outstanding Principal”); which Existing Outstanding Principal Borrower acknowledges and agrees remains outstanding in its entirety as of the date hereof immediately prior to giving effect to the amendment and restatement of the Existing Promissory Note. On the Amendment and Restatement Date, (a) an aggregate principal amount of Five Hundred Thousand Dollars ($500,000.00) of the Existing Outstanding Principal shall be converted into revolving loans (collectively, the “Revolving Loans”) and (b) substantially concurrently with such conversion, Borrower shall have repaid in cash to Lender principal in an aggregate amount equal to Five Hundred Thousand Dollars ($500,000.00) as contemplated in Section 8(d) to reduce the aggregate outstanding principal amount of the Revolving Loans to zero after giving effect to such payment. The remaining outstanding principal amount of One Million Dollars ($1,000,000.00) not converted into Revolving Loans shall be hereby be referred to as “term loans” (collectively the “Term Loans”; and the Term Loans, together with the Revolving Loans, the “Loans”). For the avoidance of doubt, each of Borrower and Lender acknowledge and agree that, as of the Amendment and Restatement Date and after giving application to the conversion of principal into Revolving Loans and the repayment of Five Hundred Thousand Dollars ($500,000.00) of Revolving Loans contemplated in Section 8(d), there shall be Term Loans outstanding in an aggregate principal amount equal to One Million Dollars ($1,000,000.00) and no Revolving Loans outstanding, in each case as of such date. Borrower unconditionally promises to pay all Obligations in U.S. dollars and in immediately available funds in such amounts and on the dates specified herein. As used herein, the term “Lender” includes the successors and assigns of Lender and also includes a holder in due course.

 

2.    Revolving Loan Requests and Advances. After the Amendment and Restatement Date, Borrower may, from time to time during the term of this Note, request in writing an advance of a Revolving Loan, which written request shall be made no later than thirty (30) days to the date of such proposed advance. In no event shall the amount of any requested advance, when added to the aggregate outstanding principal amount of Revolving Loans, exceed the Maximum Revolving Amount. Each written request shall specify the amount and date of the advance; provided that each advance shall be in an amount equal to Two Hundred and Fifty Thousand Dollars ($250,000.00) or a whole multiple of Two Hundred and Fifty Thousand Dollars ($250,000.000) in excess thereof. Lender shall be required to advance the requested funds on the date specified in such written request. The date and amount of each advance shall be noted by Lender on Exhibit A, and Borrower hereby authorizes and instructs Lender to update Exhibit A upon each such advance without any further action by Borrower.

 

3.    Calculation and Payment of Interest. Interest on the unpaid principal balance of the Loans outstanding hereunder shall accrue from the Amendment and Restatement Date at a floating rate per annum equal to the greater of (a) five percent (5%) and (b) a rate equal to the prime rate, as published by the Wall Street Journal, plus 1.00%; provided, however, that said interest rate is subject to increase or decrease on the first day of each calendar quarter based on changes in the prime rate as of such date; provided, further that it is hereby acknowledged and agreed that after giving effect to such payment contemplated in Section 8(d), Borrower shall have paid all accrued and unpaid interest under the Existing Promissory Note for the period beginning on the Original Closing Date through (but not including) the Amendment and Restatement Date.

 

4.    Payments. Interest shall be due and payable on the last day of each calendar quarter ended after the Original Closing Date during the term of this Note. The aggregate outstanding principal of each of the Loans and accrued but unpaid interest shall be due and payable on April 12, 2024 (the “Maturity Date”). Payments shall be made in cash, in U.S. dollars and immediately available funds. Each payment shall be credited first to interest then due and the remainder to principal; and interest shall thereupon cease to accrue with respect to the principal so credited.

 

5.    Prepayment. Borrower may prepay the outstanding Loans, and all unpaid interest accrued thereon, in full or in part at any time during the term of this Note without notice and without premium or penalty. Prepayments of outstanding principal of the Revolving Loans shall be in an amount equal to Two Hundred and Fifty Thousand Dollars ($250,000.00) or a whole multiple of Two Hundred and Fifty Thousand Dollars ($250,000.00) in excess thereof. Borrower shall notify Lender in writing whether such prepayment shall be applied to the Revolving Loans or the Term Loans; provided that prepayments shall be applied first to the accrued interest then due and payable, and the remainder applied to the principal of such Loans.

 

6.    Timeliness of Payment. A payment is timely made if it is actually received by Lender on or before the date on which it is due, or if it is mailed using the U.S. Postal Service and is postmarked at least one day prior to the date on which it is due. If the date a payment is due falls on a Saturday, Sunday, or a day that is a legal holiday under the laws of the United States, that payment shall be due on the next succeeding business day.

 

2

 

 

7.    Collateral.

 

(a)  Borrower hereby grants Lender, to secure the payment and performance in full of the Obligations, a continuing security interest in, and pledges to Lender, the Collateral, wherever located, whether now owned or hereafter acquired or arising, and all proceeds and products thereof. Borrower agrees that it is the intent of Borrower and Lender to have all Obligations secured by a perfected security interest in the Collateral granted herein.

 

(b)  Borrower represents and warrants that the security interest granted herein shall at all times continue to be a perfected security interest in the Collateral prior to all other security interests in the Collateral other than the Senior Lien. Borrower has good title to, rights in, and the power to transfer each item of the Collateral upon which it purports to grant a Lien hereunder.

 

(c)  Borrower hereby authorizes Lender to file financing statements, without notice to Borrower, with all jurisdictions deemed necessary or appropriate by Lender to perfect or protect Lender’s interest or rights hereunder, including a notice that any disposition of the Collateral, by either Borrower or any other Person, shall be deemed to violate the rights of Lender under the Code. Such financing statements may indicate the Collateral as “all assets of the Debtor” or words of similar effect.

 

(d)  Borrower shall execute any further instruments and take such further action as Lender reasonably requests to perfect, protect, ensure the priority of or continue Lender’s Lien on the Collateral or to effect the purposes of this Note.

 

(e)   If this Note is terminated, Lender’s Lien in the Collateral shall continue until the Obligations (other than inchoate indemnity obligations) are repaid in full in cash. Upon payment in full in cash of the Obligations (other than inchoate indemnity obligations), Lender shall, at Borrower’s sole cost and expense, terminate its security interest in the Collateral and all rights therein shall revert to Borrower.

 

8.    Conditions to Amendment and Restatement. The amendment and restatement of the Existing Promissory Note shall become effective and the Amendment and Restatement Date shall occur when each of the conditions set forth in this Section 8 shall have been satisfied:

 

(a)         Lender shall have received a duly executed counterpart hereof bearing the signature of Borrower;

 

(b)         Lender shall have received a duly executed counterpart of the Subordination Agreement bearing the signatures of each party thereto;

 

(c)         Lender shall have received a UCC financing statement naming Borrower as “Debtor” and Lender as “Secured Party”, in proper form for filing, registration or recordation with the Secretary of State of the State of Nevada; and

 

(d)         Borrower shall have repaid in cash to Lender: (a) Revolving Loans under this Note in an aggregate amount equal to Five Hundred Thousand Dollars ($500,000.00) and (b) all accrued but unpaid interest under the Existing Promissory Note.

 

9.    Sale of Borrower. Upon the closing of a Sale of Borrower, the entire outstanding Loans and all accrued and unpaid interest at such time shall become immediately due and payable.

 

10.  Events of Default. The occurrence of any one or more of the following shall constitute an “Event of Default” under this Note:

 

(a)         Failure by Borrower to pay any amount due under this Note, as currently stated or as otherwise adjusted, within thirty (30) days of the date due.

 

3

 

 

(b)         Failure by Borrower to perform or observe any other covenant or agreement contained in this Note.

 

(c)         Determination that any representation or warranty made by Borrower in this Note is false or misleading in any material respect as of the date when made.

 

(d)         Borrower shall default in the repayment of any indebtedness owed to First Foundation Bank or any of its successors and assigns, or any other material indebtedness, and such default shall not be waived or remedied within thirty (30) days after the occurrence thereof or such further time permitted for the remedying of such default under the applicable documents for such indebtedness.

 

(e)         Borrower is (i) the subject of an order for relief by the bankruptcy court or is unable or admits in writing Borrower’s inability to pay Borrower’s debts as they mature or makes an assignment for the benefit of creditors; or (ii) any judgment, writ, warrant of attachment or execution or similar process is issued or levied against all or any part of the property of Borrower and is not released, vacated or fully bonded within thirty (30) calendar days after its issue or levy.

 

(f)         There is a material impairment in the perfection or priority of Lender’s security interest in the Collateral.

 

11.  Remedies. If an Event of Default has occurred, Lender may (a) upon fifteen (15) days’ written notice to Borrower, (a) declare the Obligations (including the entire unpaid principal balance of all Loans and all accrued and unpaid interest) immediately due and payable and declare all commitments to advance any Loans to be terminated forthwith (whereupon all such commitments shall immediately terminate); provided that notwithstanding the foregoing, in the event of any Event of Default under Section 10(e), all Obligations shall automatically and immediately become due and payable and all commitments to advance any Loans shall immediately terminate automatically without any action or notice by any Person and (b) exercise any and all remedies provided under applicable law.

 

12.  Lender’s Rights; No Waiver by Lender. The rights, powers and remedies of Lender under this Note shall be in addition to all rights, powers and remedies available to Lender by virtue of any statute or rule of law, including, but not limited to, the California Civil Code and the Code. All such rights, powers and remedies shall be cumulative and may be exercised successively or concurrently in Lender’s sole discretion without impairing Lender’s rights or available remedies. Any forbearance, failure or delay by Lender in exercising any right, power or remedy shall not preclude further exercise thereof, and every right, power or remedy of Lender shall continue in full force and effect until such right, power or remedy is specifically waived in a writing executed by Lender.

 

13.  Borrower’s Waivers. Borrower and any endorsers of this Note, and each of them, hereby waive diligence, demand, presentment for payment, notice of non-payment, protest and notice of protest, and specifically consent to and waive notice of any renewals or extensions of this Note, whether made to or in favor of Borrower or any other person or persons. Borrower and any endorsers of this Note expressly waive all right to the benefit of any statute of limitations and any moratorium, reinstatement, marshaling, forbearance, extension, redemption or appraisement now or hereafter provided by the Constitution and the laws of the United States of America and of any state thereof, as a defense to any demand against Borrower or any such endorsers, to the fullest extent permitted by law.

 

14.  Transfers. This Note or any interest in this Note may be hypothecated, transferred or assigned by Lender without the prior consent of Borrower. Borrower may not assign or transfer its rights or obligations hereunder without the prior written consent of Lender.

 

15.  Amendment. This Note may be amended or modified only by an instrument in writing which by its express terms refers to this Note and which is duly executed by the party sought to be bound thereby.

 

16.  Successors and Assigns. This Note shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, executors, administrators, personal representatives, successors and permitted assigns.

 

17.  Governing Law. This Note shall be governed by and construed in accordance with the laws of the State of California.

 

18.  Attorneys’ Fees. Borrower agrees to pay all costs, including reasonable attorneys’ fees and expenses, incurred by Lender in enforcing payment or collection of this Note, whether or not suit is filed.

 

4

 

 

19.  Usury. Notwithstanding any provision herein, the total liability for payments in the nature of interest shall not exceed the applicable limits imposed by any applicable state or federal interest rate laws. If any payments in the nature of interest, additional interest and other charges made hereunder are held to be in excess of the applicable limits imposed by any applicable state or federal laws, it is agreed that any such amount held to be in excess shall be considered payment of principal and the principal balance of the Loans shall be reduced by such amount in the inverse order of maturity so that the total liability for payments in the nature of interest, additional interest and other charges shall not exceed the applicable limits imposed by any applicable state or federal interest rate laws in compliance with the desires of Lender and Borrower.

 

20.  Amendment and Restatement. This Note amends and restates and is issued in replacement of the Existing Promissory Note made by Borrower in favor of Lender. This Note is not intended to be, and shall not be construed to be, a novation of any of the obligations owing under or in connection with the Existing Promissory Note, and any obligations outstanding under the Existing Promissory Note will be deemed Obligations in accordance with this Note.

 

21.  Notices. All notices, requests, demands, instructions and other documents required or permitted by this Note shall be personally delivered or couriered, or sent by other means of written telecommunication, or mailed, certified or registered mail, return receipt requested, to the following addresses (or such other address to which a party has been notified in accordance with this provision):

 

	If to Lender:	Skywords Family Foundation Inc.
	 	1621 Juanita Lane
	 	Tiburon, CA 94920
	 	Attn: Michael A. Davis
	 	Email: michael@arlendavis.org
	 	 
	With a copy to:	Morrison & Foerster LLP
	 	425 Market Street
	 	San Francisco, CA 94105
	 	Attn: Jackie Liu; Victor Liang
	 	Email: jliu@mofo.com; vliang@mofo.com
	 	 
	If to Borrower:	Cyanotech Corporation
	 	73-4460 Queen Kaahumanu Hwy., #102
	 	Kailua-Kona, HI 96740
	 	Attn: Felicia Ladin
	 	Email: fladin@cyanotech.com
	 	 
	With a copy to:	Farella Braun + Martel LLP
	 	235 Montgomery Street, 17th Floor
	 	San Francisco, CA 94104
	 	Attn: Jesse Debban
	 	Email: jdebban@fbm.com

 

A personal or courier delivered notice shall be effective on delivery; a notice sent via telex, facsimile, electronic mail or other means of written telecommunications shall be effective one (1) business day after sending; a mailed notice shall be effective upon the date shown on the return receipt or other evidence of delivery, provided, however, that if the recipient refuses to accept delivery, such notice shall be effective three (3) business days after being mailed.

 

22.  Definitions. As used in this Note, (including in the recitals hereof), the following terms shall have the following meanings; provided that all other terms contained in this Note, unless otherwise indicated, shall have the meaning provided by the Code to the extent such terms are defined therein:

 

“Borrower’s Books” means all of Borrower’s books and records including ledgers, federal and state tax returns, records regarding Borrower’s assets or liabilities, the Collateral, business operations or financial condition, and all computer programs or storage or any equipment containing such information.

 

5

 

 

“Code” means the Uniform Commercial Code, as the same may, from time to time, be enacted and in effect in the State of California; provided, that, to the extent that the Code is used to define any term herein and such term is defined differently in different Articles or Divisions of the Code, the definition of such term contained in Article or Division 9 shall govern; provided further, that in the event that, by reason of mandatory provisions of law, any or all of the attachment, perfection, or priority of, or remedies with respect to, Lender’s Lien on any Collateral is governed by the Uniform Commercial Code in effect in a jurisdiction other than the State of California, the term “Code” shall mean the Uniform Commercial Code as enacted and in effect in such other jurisdiction solely for purposes of the provisions thereof relating to such attachment, perfection, priority, or remedies and for purposes of definitions relating to such provisions.

 

“Collateral” means all of Borrower’s right, title and interest in and to the following personal property:

 

(a)         all goods, Accounts, Equipment, Inventory, contract rights or rights to payment of money, leases, license agreements, franchise agreements, General Intangibles, Intellectual Property, commercial tort claims, documents, instruments (including any promissory notes), chattel paper (whether tangible or electronic), cash, deposit accounts, certificates of deposit, fixtures, letters of credit rights (whether or not the letter of credit is evidenced by a writing), securities, securities accounts, securities entitlements and all other investment property, supporting obligations, and financial assets, whether now owned or hereafter acquired, wherever located; and

 

(b)         all Borrower’s Books relating to the foregoing, and any and all claims, rights and interests in any of the above and all substitutions for, additions, attachments, accessories, accessions and improvements to and replacements, products, proceeds and insurance proceeds of any or all of the foregoing;

 

provided that Collateral, the terms of this Note and the security interest granted hereby, shall not include or attach to any lease, license, contract, rights, permit or agreement to which the Borrower is a party or any of its rights or interests thereunder if and for so long as the grant of the security interest granted hereby would constitute or result in (i) the abandonment, invalidation or unenforceability of any material right, title or interest of Borrower therein, or (ii) a breach or termination pursuant to the terms of, or a default under, any such lease, license, contract property rights or agreement (other than to the extent that any such term would be rendered ineffective pursuant to Sections 9-406, 9-407, 9-408 or 9-409 of the UCC (or any successor provision or provisions) of any relevant jurisdiction or any other applicable law or principles of equity), provided, however, that the security interest granted hereby shall attach immediately at such time as the condition causing such abandonment, invalidation, voidness, voidability, terminability, revocability, material breach or default or unenforceability shall be remedied and, to the extent severable, shall attach immediately to any portion of such lease, license, contract, property rights or agreement that does not result in any of the consequences specified in parts (i) through (ii) above, including, without limitation, any proceeds of such lease, license, contract, rights, permit or agreement.

 

“Intellectual Property” means, with respect to any Person, all of such Person’s right, title, and interest in and to the following:

 

(a)         its copyrights, trademarks and patents;

 

(b)         any and all trade secrets and trade secret rights, including, without limitation, any rights to unpatented inventions, know-how and operating manuals;

 

(c)         any and all source code;

 

(d)         any and all design rights which may be available to such Person;

 

(e)         any and all claims for damages by way of past, present and future infringement of any of the foregoing, with the right, but not the obligation, to sue for and collect such damages for said use or infringement of the Intellectual Property rights identified above; and

 

6

 

 

(f)         all amendments, renewals and extensions of any of the copyrights, trademarks or patents.

 

“Lien” means a claim, mortgage, deed of trust, levy, attachment charge, pledge, hypothecation, security interest or other encumbrance of any kind, whether voluntarily incurred or arising by operation of law or otherwise against any property.

 

“Obligations” means Borrower’s obligations to pay when due any debts, principal, Loans, interest, fees, expenses and other amounts Borrower owes Lender now or later, in connection with this Note (including for the avoidance of doubt any such amount arising under the Existing Promissory Note prior to the amendment and restatement pursuant hereto), including, without limitation, all obligations and interest accruing after the beginning of any proceeding by or against Borrower under the United States Bankruptcy Code, or any other bankruptcy or insolvency law.

 

“Person” means any individual, sole proprietorship, partnership, limited liability company, joint venture, company, trust, unincorporated organization, association, corporation, institution, public benefit corporation, firm, joint stock company, estate, entity or government agency.

 

“Sale of Borrower” means (a) a sale of all or substantially all of the assets of Borrower; or (b) any reorganization, stock sale, merger, consolidation or other transaction or series of related transactions in which, directly or indirectly, the holders of the voting securities of Borrower outstanding immediately prior to such transaction or series of related transactions retain less than a majority of the total voting power of Borrower or such other surviving or resulting entity.

 

“Senior Creditor Agreements” means (i) that certain Term Loan Agreement, dated as of August 14, 2012, by and between Senior Creditor (as successor in interest to Pacific Rim Bank), Borrower and Nutrex Hawaii, Inc., a Hawaii corporation (“Nutrex”), (ii) that certain Term Loan Agreement, dated as of July 30, 2015, between Senior Creditor, Borrower and Nutrex and (iii) that certain Revolving Credit Agreement, dated as of June 3, 2016, between Senior Creditor and Borrower.

 

“Senior Debt” means any and all indebtedness and obligations for borrowed money at any time owing by Borrower to Senior Creditor under the Senior Loan Documents.

 

“Senior Lien” means such Lien securing the Senior Debt to the extent provided in, and subject to, the Subordination Agreement.

 

“Senior Loan Documents” means each of the Senior Creditor Agreements and any other agreement, security agreement, document, promissory note, UCC financing statement, or instrument executed by Borrower in favor of Senior Creditor in connection with the Senior Creditor Agreement, as the same may from time to time be amended, modified, supplemented, extended, renewed, restated or replaced.

 

[Signature Page Follows]

 

7

 

 

IN WITNESS WHEREOF, Borrower has executed and delivered this Note effective as of the date first written above.

 

 

	 	BORROWER:	 
	 	 	 	 
	 	Cyanotech Corporation	 
	 	a Nevada corporation	 
	 	 	 	 
	 	 	 	 
	 	By:	/s/Felicia Ladin	 
	 	Name:	Felicia Ladin	 
	 	Title:	CFO	 

 

 

 

	ACCEPTED AND AGREED:	 	 
	 	 	 	 
	LENDER:	 	 
	 	 	 	 
	Skywords Family Foundation Inc.	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	By:	/s/Michael Davis	 	 
	Name:	Michael Davis	 	 
	Title:	President	 	 

 

 

 

 

EXHIBIT A

SCHEDULE OF ADVANCES AND REPAYMENTS

 

	
			DATE

				
			AMOUNT 

			BORROWED

				
			AMOUNT 

			REPAID

				
			OUTSTANDING 

			BALANCE OF 

			ALL REVOLVING 

			LOANS

				
			NOTATION BY

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